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Gulfstream Energy awarded first of its kind mining contract

23 October 2015

Black Mountain Mining awards contract for total fluid management solution to independent fuel wholesaler

Earlier this year saw Gulfstream Energy, one of South Africa’s larger independent fuel wholesalers, awarded sole supplier of a total fluid management solution to the Gamsberg Project site located close to the Black Mountain Mine in Aggeneys.  Effective as at 1 August 2015, the agreement will see Gulfstream responsible for a fully supported fuel management solution in addition to the supply of all fuel in support of the mine’s operations.

“This is of huge significance to Gulfstream Energy,” says Shane Jegels, CEO. “Not only does it enable us to make inroads into a market sector traditionally the stronghold of the oil majors, but it is also unique with no other mining company to date having awarded a contract of this nature to an independent non-refining player.” 

The Gamsberg Project involves the development, construction and commissioning of a 4 Mtpa (ROM) open-pit zinc mine, concentrator and associated infrastructure. The Project is owned by Black Mountain Mining (Pty) Ltd (“BMM”), a 74% subsidiary of Vedanta Limited (a listed subsidiary of Vedanta Resources plc). The remaining 26% is owned by Exxaro Resources Ltd. BMM comprises the Deeps and Swartberg mines and the Gamsberg Project located near the town of Aggeneys, Northern Cape.

“Fuel is one of the major procurement components required to keep a mine operational,” says Jegels. However, the manner in which mining companies procure fuel is slightly different to other commercial entities. “Mining operations typically require a managed solution,” says Jegels. Response to this market demand has seen Gulfstream launch its ‘Gulfstream Molecule Management Solution’. “What this entails,” continues Jegels, “is that over and above procurement of the actual fuel products, Gulfstream takes full responsibility for both the delivery and management of a number of elements. 

In the case of BMM, this has seen Gulfstream invest in on-site fuel infrastructure (including fuel tanks and pumps), stock on consignment and the placement of Gulfstream staff at the Gamsberg site to co-ordinate and manage its mandate.  “In addition, we have also deployed an automated fuel management system through a third party partner, Gilbarco AFS,” continues Jegels. This allows for the effective management of all on-site fuel storage, dispensing, recording and real-time reporting providing up to the minute accurate information on fuel spend.

Gulfstream on site fuel infrastructure at BMM

“We have also appointed one of the country’s only black female site managers,” continues Jegels.  A qualified electrician with numerous years’ experience across South Africa’s mining industry including the likes of De Beers, Springbok Municipality and Assmang Mine, Saretha Faro hails from the Northern Cape.  “Saretha’s appointment has enabled us to not only make a positive contribution towards job creation and employment within the area, but to continue delivering on our core ethos – that of empowerment within local industry.”

Shane Jegels, Sareth Faro and Faeez Samsodien at the BMM site

Gulfstream first indicated its interest to respond to the Gamsberg site tender towards the end of last year, with discussions beginning in earnest in January this year. “With fuel one of our key procurement components, security of supply was non-negotiable,” says Deshnee Naidoo, CEO, Vedanta Zinc International. “With its diverse supplier network, comprising over 26 depots and refineries around the country, we were confident that Gulfstream Energy would be able to meet our requirements.” In addition, Gulfstream’s track record, capability and experience across the entire supply chain further reinforced its ability to be able to deliver the total fluid management solution required.

“It has also provided us with the opportunity to take an empowerment partner into a market sector previously not available to them,” continues Naidoo. Further, with its 100% black-women owned, Level 2 B-BBEE and empowering supplier status, Gulfstream can guarantee its customers are able to claim 125% of spend in support of their own preferential procurement and B-BBEE rating.

“To be part of the opening of the only greenfield open cast mining operation in South Africa this year, is a source of huge pride for Gulfstream,” continues Jegels.  Over and above the recognition to Gulfstream Energy in the awarding of this contract, the Gamsberg site is set to bring substantial investment to the Northern Cape – an area known to be struggling and in need of economic development. “To be able to play even a small part in this enables us to fulfil one of our key objectives, that of giving back to both industry and the South African economy.”
 

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