The executive team of FLSmidth in sub-Saharan Africa, Middle East and South Asia, talk us through the company’s pure play mining strategy, MissionZero sustainability programme, and service footprint across the region.
MINING FOR A SUSTAINABLE WORLD
To become a pure play mining company with a sharpened focus on core technologies and services, FLSmidth has kickstarted its transformation journey.
A key element of this journey is to focus the business on core technologies. While still being a full flowsheet technology and service supplier to the global mining and cement industries, some less strategic important technologies were placed in the Non Core Activities (NCA) segment in October last year, to be either wound down or sold off by the end of 2024.
With the latest announcement in June 2023 of an asset purchase and transfer agreement with KOCH Solutions, FLSmidth is accelerating the pace of its exit from NCA.
“We’ve divested our NCA in relation to bulk materials logistics, which means that we can focus on our pure play mining strategy,” outlines Deon de Kock, President for sub-Saharan Africa, Middle East and South Asia (SSAMESA), where FLSmidth has established offices in South Africa (SA), Ghana, Saudi Arabia, and India.
FLSmidth’s pure play mining strategy, CORE’26, is rooted in its purpose of mining for a sustainable world and mission of delivering solutions for tomorrow’s mine. To execute this mission, CORE’26 is driven by four key pillars: sustainability, service, technology, and performance.
CORE’26 thus provides a clear path for FLSmidth to build on its core strengths, become an even stronger player in the market, and improve its profitability in mining, where the company offers the full technology and service portfolio for process plants covering key commodities, including copper, gold, nickel, lithium, zinc, rare earth, and iron ore.
“The key priority for FLSmidth in SSAMESA, but also globally, is the pure play mining strategy. It really focuses on our core offering to become a technology and service provider for our clients, so they can become more successful, mine more responsibly, and drive down their carbon emissions to work towards net zero,” de Kock emphasises.
In addition to selling its material handling technology assets to KOCH Solutions, FLSmidth has also made the bold decision to exit coal and not participate in any greenfield coal projects, demonstrating its commitment to sustainability and developing projects that can drive its MissionZero programme.
With MissionZero, FLSmidth has set a target of providing solutions for zero-emission mining and cement production by 2030, supporting a green transition built upon sustainable materials.
Indeed, cement and mining operations have a significant impact on the environment, accounting for approximately 10 percent of all CO2 emissions combined.
With growing populations, a larger middle class, and a transition to greener energy, the demand for cement and minerals – and thus the environmental impact – will only increase in the next 10 years.
“The coming decade is not going to be easy, as the growing population and green transition has put more pressure on net zero emission activities,” says Venkatesan Punniyamurthy, Head of Capital Sales for SSAMESA.
The company will continue to leverage its ability to innovate, improve, and produce world-class offerings across the full flowsheet in line with the MissionZero sustainability programme.
Through MissionZero, FLSmidth is taking the lead in bringing the mining and cement industries into a sustainable future without compromising quality or its customers’ commercial competitiveness.
FLSmidth’s ambitions moving forward are to deliver solutions that make it possible to manage zero-emission mining processes and operate zero-emission cement plants.
“Achieving this ambition really requires a paradigm shift in terms of collaboration, innovation, and the adoption of various new technologies in both industries,” Punniyamurthy emphasises.
From FLSmidth’s point of view, this starts upstream, where the company connects with suppliers and even ensures they have decarbonisation goals.
Indeed, the company has a tough internal target in which 30 percent of the suppliers it procures components from will have decarbonisation goals by 2025.
Downstream, meanwhile, it comes from FLSmidth’s products, technologies and innovations, which consume less energy in the mining plants.
“In the area that I’m responsible for, we have products that are definitely more efficient compared to our competitors,” shares Stephan Kruger, Head of Pumps, Cyclones and Valves for SSAMESA.
“We’ve seen improvements of around 15 percent; that’s how we really support our customers, by making sure that they’ve got the best technology.”
SAUDI ARABIA FOCUS
Another of FLSmidth’s key focuses in SSAMESA from a growth perspective is Saudi Arabia, whose Vision 2030 blueprint seeks to transform mining into the country’s third economic pillar.
“The fundamentals in Saudi Arabia are sound. They’ve shown the ability to be able to scale up massive petrochemical projects, they’ve got a legal framework that is geared towards investment in mining, and there’s strong financial backing in the industry,” observes Alistair McKay, Head of Site and Service Sales for SSAMESA.
In August 2023, FLSmidth was chosen to supply the key technologies and services for Ma’aden’s phosphate 3 phase 1 mine site in the northern province of Saudi Arabia.
The company has partnered with Ma’aden from the onset of the new phosphate mine operations, starting with the initial laboratory testing of samples retrieved from the ore body in 2019, through to the development of the flowsheet and pilot scale testing.
The focus of the collaboration all along has been to ensure the integrity of the flowsheet is maintained while ensuring the technology is well integrated into the overall plant design to deliver the best possible performance.
With this new order, FLSmidth will supply all key equipment associated with the phosphate beneficiation plant, as well as technical support services through the design, construction, commissioning, and ramp-up phases.
The order sets another strong standard for FLSmidth’s MissionZero agenda. In particular, the incorporation of paste thickening and dewatering technology at this important mine site plays a key role in reducing emissions and water spend from the beneficiation process.
“We’ve been in Saudi Arabia for many years and were recently awarded the phosphate 3 phase 1 project, where we are the technology partner,” McKay informs us.
“We are looking to continue that partnership into the future and certainly build on that as a key hub not only within Saudi Arabia but expanding into the surrounding region.”
RESPONDING TO CUSTOMERS
As well as expanding into the Middle East, FLSmidth is also looking to build out its service footprint in West Africa to be more responsive to its customer base.
Bringing optimal value to clients is a very important focus for the company as commodity prices cool following a steep rise in recent years, placing pressure on mines to cut costs.
“We’ve seen the inflationary effects starting to come through and weigh quite heavily on our clients in terms of their operating costs, so ultimately, what we do day in, day out must create value,” affirms McKay.
“It’s really about being that partner to our clients in terms of optimising processes, operations, and creating value.”
In order to be more responsive, FLSmidth is looking to add some much-needed operational space to its refurbishment business to shorten lead times and deal with larger volumes. The Chloorkop Service Centre is specifically targeted for expansion.
“We’re going to set ourselves up as a centre of excellence for high-pressure grinding roll (HPGR) refurbishment within our global service centre network, and we’re busy investing into potential service centres in Saudi Arabia and Ghana,” adds Nico Erasmus, Head of Professional Services for SSAMESA.
“To bring that OEM difference to our field service and on-site work, we’re also currently expanding our technician certification programme, and we continue to bring unique solutions in terms of how we execute and bring service to the market.”
When it comes to responding to customers, people are FLSmidth’s biggest resource as brand ambassadors and the face of the company.
In return for increasing profitability, the company provides an environment of equal opportunity that allows them to perform to the best of their ability.
Looking at the SSAMESA region in particular, one of the key elements for FLSmidth is obtaining, training, and retaining talent in the organisation.
“All three of these things are difficult because it’s still tough to attract people to the mining industry, despite the fact we have become more responsible and our image in the market is better,” de Kock acknowledges.
“But to have sustainable operations, you need to have a solid pool of talent. We look at doing business in a financially viable and sustainable manner where we operate in SA, Ghana, Saudi Arabia and India.”
CORE’26 MINING STRATEGY
Sustainability – FLSmidth wants to build a better future for its employees, society, and the planet. It will achieve this by accelerating its MissionZero ambition and achieving its ESG targets.
Service – Through its service offerings, FLSmidth aims to deliver quantifiable value over the life cycle of a mine that advances customers’ sustainability agendas and improves their bottom lines.
Technology – FLSmidth is the complete provider of process and product technology with world-class sustainable offerings across the full flowsheet. The company prioritises R&D that supports its sustainability ambitions and its customers’ green journey.
Performance – The company will accelerate its profitability and build a healthy business by focusing on core business, simplifying its operating model and balancing risk.
In SA, FLSmidth subscribes to broad-based black economic empowerment (B-BBEE) initiatives and is a proud Level 1 B-BBEE contributor.
The company has invested heavily in apprenticeship, learnership, and scholarship programmes to feed the talent pipeline in SA, as well as Ghana and India, and will be doing the same in Saudi Arabia.
Furthermore, as it has done in SA, FLSmidth has made the conscious decision to employ native Ghanaians and Saudi Arabians in their respective countries.
“We believe in being a responsible corporate citizen in the communities that we operate, and exceed our corporate social responsibility (CSR) in terms of projects with doorstep community involvement,” adds de Kock.
Being a global multinational, FLSmidth has very strong values that are aligned with the values of its staff, making the company an employer of choice.
“We’ve got a lot of fantastic people that are critically important and the foundation of our success,” Kruger tells us.
Echoing this sentiment is Bhavesh Parbhoo, Head of Order Handling and Execution for SSAMESA, who takes heart and confidence in the team’s maturity and agility.
“Both the industry and the company are going through significant change, and the one thing that has always kept FLSmidth on top is the level of maturity to navigate this change,” he says.
Likewise, suppliers and partners play an equally critical role in helping the company achieve its strategy and leverage past learnings to increase its effectiveness.
“They assist us with the free flow of communication, feedback and ideas,” Parbhoo concludes.