This strategic move aligns with our recently announced strategy, to streamline operations and focus on our core competencies, ensuring continuous growth and value creation for our stakeholders. Nutreco is recognised worldwide for its commitment to excellence and innovation, making it the right home for the Animal Health business and our people.

Holger Riemensperger, Group CEO of AECI, commented, "We are pleased to have found a partner that shares our vision and values in Nutreco. This transaction represents a significant milestone in our journey, and we are confident that the Animal Health business will thrive under Nutreco's leadership."

The transaction is subject to customary closing conditions, including regulatory approvals and the satisfaction of other agreed-upon terms. We anticipate the transaction to close in four to six months.

We remain focused on the successful execution of our strategy. This transaction affords us the opportunity to concentrate our efforts and resources to achieve our ambition to double profitability of the core business (Mining and Chemicals) by 2026 and attain a global market position in Mining of number 3 by 2030.

We extend our sincere thanks to all employees, customers, suppliers and partners for their dedication and support. We look forward to a seamless transition and continued collaboration with Nutreco in the future.

For more information, please contact:

Zanele Salman

VP: Investor Relations zanele.salman@aeciworld.com

groupcommunications@aeciworld.com

AECIInvestorRelations@aeciworld.com

About AECI

AECI is a diversified chemicals solutions company employing 7 168 people at more than 100 sites. We have a presence in 22 countries on six continents. Founded in 1896 to service South Africa’s burgeoning gold and diamond mining industries, the company was formally established in 1924. AECI was listed on the Johannesburg Stock Exchange in 1966. A mainstay of the economy in South Africa, over the years we have expanded our presence and evolved our product and service offering to a broad base of customers. Our products and services include, mine-to-mineral solutions, water treatment solutions, chemical raw materials and related services, asphalt and bitumen for road construction, food and beverage ingredients and commodities, vitamin and mineral animal feed premixes, crop protection products and plant nutrients as well as property leasing and provision of utilities. Our operating businesses are structured into four key operating business segments – AECI Mining, AECI Water, AECI Agri Health and AECI Chemicals.

Forward-Looking Statements

This media release contains forward-looking statements, including but not limited to statements regarding the anticipated closing of the transaction and future performance of AECI. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from those anticipated due to various factors.

AECI website: www.aeciworld.com

Nutreco website: www.nutreco.com

1. Earnings before interest and taxation is defined as profit before interest, taxation and share of profit of equity-accounted investees, net of taxation

1. Earnings before interest, taxation, depreciation and amortisation calculated as profit from operations and equity-accounted investees plus depreciation, amortisation and impairments.

EBITDA is unaudited.

The main highlight in the year was the excellent safety performance, reflected in a Total Recordable Incident Rate (TRIR) of 0.15. This is the lowest TRIR since AECI commenced measuring this metric. The Group is also on track to reach all its published 2025 sustainability targets.

The upward strong performance was made possible by delivery in line with a solid growth strategy across the Group’s businesses.

AECI Mining achieved a record performance by growing revenue by 51%, attributed to strong market share gains, export growth in mining chemicals and increased chemical commodity prices. 67% of the businesses’ total revenue was generated outside of South Africa.

AECI Chemicals, AECI Water and AECI Agri Health grew revenue by 32%, 31% and 17% respectively. Similarly, the increased revenue performance was directly attributed to delivery against a more focused strategy and improved sales volumes.

Proactive actions taken by the Group to ensure security of supply to the market, following supply chain challenges, and high raw material prices during the period resulted in elevated levels of working capital. Inventory increased to R6 780 million (2021: R4880 million), matched by an increase of R1 985 million (2021: R446 million) in short-term debt.

The AECI Schirm Germany business recorded an operating loss of R228 million which triggered a right-of-use asset and PPE impairment of R445 million. The Board-approved comprehensive turnaround project is expected to deliver commercial recovery including clearly defined milestones as well as details associated with the required once off costs. Notably, high priority actions have been taken and we expect once-off costs to impact 2023 earnings. The Board expects positive earnings contribution within 20 to 36 months.

AECI Much Asphalt delivered a markedly better performance, increasing revenue by 37% and EBIT by 21% from 2021’s result.

The initial vesting period of the AECI Employees Share Trust (EST) was extended by 12 months by the Board to 9 February 2023. An additional dividend of 50.5 cents per share was paid to beneficiaries on 28 September 2022. As at the extended vesting date, the share scheme was not value accretive to beneficiaries and will therefore be wound up. The Group remains committed to driving the Group’s B-BBEE ownership goals.

Following the appointment of the new Group Chief Executive, Holger Riemensperger who will join AECI on 1 May 2023 the Group’s leadership remains highly energised and focused on optimising existing operations in 2023 and beyond.

AECI Schirm USA is a leading contract manufacturer for the crop protection industry. A well-established site in Ennis, Texas logistically services the Southwest and a newly acquired site in Benton, Illinois logistically services the Midwest, which is widely regarded as “America’s breadbasket” because of the large volumes of corn, soybeans and wheat that are farmed there. After repeated enquiries from customers who sell globally (including the USA as a whole), AECI Schirm USA acquired the site in Benton, Illinois as an existing industrial facility from Bio Fuels by American Farmers & Veterans for US$2,3 million in 2021.

The two strategic growth projects, which are scheduled for completion before the end of 2022, are:

1.  ENNIS – PRODUCTION CAPACITY EXPANSION

Four new plants will be constructed, including one herbicide Suspension Concentrate (SC) plant, one insecticide Emulsifier Concentrate (EC) plant and two insecticide SC plants. (An EC plant produces liquid crop protection products where a liquid or solid active ingredient is dissolved in solvent with emulsifiers, whereas an SC plant produces liquid crop protection products where a solid active ingredient is dissolved in water. ECs are one of the most common formulation types for crop protection products worldwide and SCs are growing in popularity due to benefits such as absence of dust, ease of use and effectiveness.)

2.  BENTON – PRODUCTION CAPACITY EXPANSION

Two new herbicide plants will be constructed, including one EC plant and one SC plant.

According to research by Fortune Business Insights and Grandview Research respectively, the global crop protection chemicals market is projected to grow from US$59,41 billion in 2021 to US$81,74 billion in 2028 at a compound annual growth rate (CAGR) of 4,66% and the US crop protection chemicals market is projected to grow at a CAGR of 3,8% for the next five years, with herbicides being the main contributor. There is also an increase in the number of farmers who are choosing cost-effective generics, and growth in this category is likely to surpass the market averages. AECI Schirm USA is a trusted supplier of generics and well-positioned to grow from this emerging trend.

“The USA is a major player in the global agriculture industry with over 913 million acres of cultivable land and natural farmland,” says Mark Dytor, AECI’s Chief Executive. “To ensure project success and reduce risk, we are investing in partnership with AECI Schirm USA’s strategic customers who are committed to shared growth in the long-term, which is the essence of AECI’s customer-centricity approach globally.

“These two strategic projects will strengthen AECI’s infrastructure base in the USA, particularly in terms of manufacturing and warehousing as well as managerial capacity, and support diversification of the geographical footprint for other Group businesses. Already in the USA, AECI Plant Health has 31 product registrations and AECI Specialty Chemicals has Henry® Company approval for bitumen emulsifiers. All this is in line with the Group’s strategy to continue expanding its global footprint and grow hard currency earnings.”

AECI is not new to the USA. The Group has wholly-owned AECI SANS Fibers, a leading producer of fibres and yarns for nylon and polyester sewing threads, in Stoneville, North Carolina since 2007. In addition, AECI has been a strategic investor in Origin Materials, the world’s leading carbon-negative materials company, in West Sacramento, California since 2017. In terms of the joint development agreement between the two companies, which was broadened in 2021, Origin Materials will supply AECI SANS Fibers with carbon-negative PET and next-generation polymers to be used in a wide range of end products in the future. This will increase the opportunity for new business from sustainable resources in the USA and beyond.

Issued by:

Lauren Winchester
T 010 823 2209 | C 083 421 9683
E lauren@epiphanybrandagency.co.za

For and on behalf of:

Fulvia Putero
T 011 806 8797 | C 082 800 3703
E fulvia.putero@aeciworld.com

“In the same way that it takes a village to raise a child, it takes a village to raise a business.”

Mishack Mthethwa 

Group Manager: Strategic Sourcing and Enterprise and Supplier Development, AECI 

“This is why we go beyond B-BBEE compliance, box-ticking and point-scoring to create a dynamic ecosystem that includes external partners and internal specialists committed to growing Small, Medium and Micro Enterprises (SMMEs) with the potential to grow our business and South Africa’s economy in the future. Since research clearly shows that SMMEs require finance, market access, marketing and new business development, our ESD programmes are powered by sector-specific enabling ecosystems through the R30 million AECI ‘Good Chemistry’ Fund. A case in point is the work we are doing in the agricultural sector where we have a long, proud history.” 

AECI Agri Health generated 25% of the Group’s total revenue in 2020. It is a key strategic growth pillar and it has played a pivotal role in a three-year pilot project.  This project provided the catalyst and framework to embark on an Emerging Farmers Support and Development Programme. The enabling ecosystem includes: 

AECI Agri Health 

Agricultural skills development and 

advisory services 

AECI ‘Good Chemistry’ Fund

Finance 

IDF Capital

Fund managers

Khula! App

Market access

LEAP

Sustainable business development and growth enablement 

Since the inception of the pilot project and programme, some of the lessons learnt are the need for financial reporting, fortnightly monitoring of the expected harvest output, technical assistance and technology. 

AECI and IDF Capital work closely together to:

• Assess the commercial viability of projects 

• Design transaction structures 

• Evaluate funding instruments and their pricing 

• Facilitate due diligence investigations 

• Negotiate terms on behalf of farmers with funders and off-takers 

• Prepare and review legal agreements 

At the same time, AECI partners with LEAP, an organisation with extensive experience and know-how in growing SMMEs, and the Khula! app in which AECI recently acquired an equity investment. 

On the Khula! Fresh Produce Marketplace App, emerging farmers sell their produce in bulk; and on the Khula! Inputs App, emerging farmers buy products and services. 

Today, three emerging farmers are on the programme, namely Farmers Hope, HempVest and Ithuba. Together, they employ at least 21 permanent employees and 110 seasonal workers across 3 042 hectares (Ha) in Gauteng, Mpumalanga and North West. 

Agriculture is critically important to growing the economy. 

The Africa Institute for Policy Analysis (AIPA) says that the agricultural sector is an engine for development and growth because of the downstream and upstream linkages between agriculture and the secondary and tertiary sectors. Agriculture supplies these sectors with raw materials and, in turn, provides a market for goods and services. AIPA estimates that a 1% contribution by agriculture to GDP produces a 2% increase in the country’s growth, and an investment of R1 million in agriculture generates twice as many jobs as an equivalent investment in the manufacturing sector. 

According to Statistics South Africa, agriculture was the only positive contributor to the economy in Q2 2020, growing by 15,1%. In Q3 2020, it grew by 18,5% representing a value of R79,4 billion. 

The South African government believes that the key to food security lies in investing in emerging farmers and has committed R1,2 billion to support 150 000 smallholder and subsistence farmers. 

“In AECI’s 2020 Sustainability Report, we detailed the alignment of our strategy to carefully selected United Nations Sustainable Development Goals (SDGs), most notably in the ESD context “Decent work and economic growth” and “Partnerships for the goals”. Our Emerging Farmers Programme emboldens our commitment to “Zero hunger” and “Responsible consumption and production”,” explains Mishack. 

“It is clear that there will be a growing market for AECI in the future. But, the ultimate success of the Emerging Farmers Programme will lie in the contributions and strengths of the entrepreneurs and partners, and the effectiveness of their collaboration.” 

Meet the farmers

Farmers Hope

Founded by Tebogo Nyathela in 2016, the 20Ha farm in North West specialises in crops (cabbages, garlic, peppers and spinach) and poultry (chickens and eggs). There are five permanent employees and seven seasonal workers. Three more seasonal workers are employed in peak seasons. 

With a background in corporate affairs and marketing, Tebogo learnt farming literally from the ground up, completing a number of learning programmes at the Agricultural Research Council in Roodeplaat, Tshwane. She registered and started the business with her own money, taking over the “Permission to Occupy” agreement with the local authority before clearing the area of bush, fencing 5Ha and installing a borehole, an irrigation system and electricity. 

In April 2021, the AECI ‘Good Chemistry’ Fund approved a loan facility of R880 000 including a technical assistance grant of
R80 000 for drilling a second borehole. LEAP provides ongoing business support and mentorship. 

HempVest 

Founded by Zunaid Mayet and Zaid Mohidin in 2019, the 22Ha farm in Gauteng specialises in crops (broccoli, cucumbers, lettuce, peppers and tomatoes) and low/no THC cannabis. (THC is tetrahydrocannabinol, the main psychoactive compound in cannabis.) There are 10 permanent employees and 50 seasonal workers. Thirty more seasonal workers are employed at peak times. 

Cannabis farming is fairly new to South Africa and legislation is changing. The expectation, though, is that the industry will grow to R107 billion by 2025. HempVest’s vision is to become a leading, vertically integrated cannabis business, distributing a range of CBD products in South Africa, the rest of the continent and beyond. (CBD is cannabidiol, the second most prevalent active ingredient in cannabis.) 

Operating under a lease-to-buy agreement, HempVest set up the necessary greenhouse, nursery and security infrastructure as well as the required operating processes and procedures. 

In June 2021, the AECI ‘Good Chemistry’ Fund approved a convertible loan facility of R2,65 million for a processing facility, farming equipment, land preparation and working capital. Also included is a technical assistance grant of R265 000 for Global G.A.P. certification, software licences and training (Global G.A.P. is the most widely accepted private sector food safety certification). 

Ithuba 

This cooperative comprises six members who have worked together for more than 10 years. The 3 000Ha farm is in Mpumalanga. Twenty seasonal workers are employed in peak seasons. 

Ithuba rotates two crops (maize and soya beans) for sale to local grain silos. There is also livestock (cows and sheep) for sale to three feedlots. 

The AECI ‘Good Chemistry’ Fund recently approved a short-term facility of R600 000 for working capital. Further support could be forthcoming depending on the success of the season. 

The requirements to qualify for AECI’s Emerging Farmers Support and Development Programme are: 

• 51% (minimum) Black ownership

• 51% (minimum) Black employees

• Land access/tenure

• Agricultural experience

• Openness to mentorship and other support, such as soil testing

• Commitment to meeting performance targets

The DGPS enables faster blast deployment, greater accuracy and increased efficiency. 

The benefits are fourfold: 

1. Potential human error from incorrect blast hole identification or incorrect delay assignment can be a thing of the past. The timing process is predisposed to human error, with incorrectly marked blast holes resulting in incorrect delay assignment. The process of identifying the location of the unconnected hole is time-consuming, while incorrect timing may compromise fragmentation and therefore downstream operations.  

2. The DGPS is capable of achieving location accuracy within less than a metre. The design mitigates signal degradation for a high level of precision. 

3. Increased safety, through the system’s ability to protect against human error, is also a major value addition. Blast hole coordinates, along with the respective detonator delays, are downloaded onto the tagger to prevent the user from incorrect delay assignments on the bench. The response to blast hole location and fault-finding are made faster, safer and simpler. Additionally, the tagging process does not need to follow a specific tagging path. 

4. Another key value proposition is data availability, allowing for reconciliation of planned versus actual blast holes, enabling continuous improvement. 

The DGPS will assist in bringing large-scale mining into the digital era and supports new blasting techniques and mining methods to increase productivity and reduce blasting costs. Mining customers will reap quantifiable benefits on their surface operations, including better ore recovery, high levels of safety and improved operational flexibility, all of which are necessary parameters in their quest to operate sustainably. 

“Since customer-centricity is a key focus, we decided to bring distribution back in-house,” said Carlo de Candia, Operations Manager: AECI Food & Beverage. “This gives us better control because we can manage and troubleshoot services on a daily basis. It also gives us the opportunity to assist with urgent deliveries and orders. It is a management change that will see customers receive even better levels of service than in the past.”

A stone’s throw away from AECI Food & Beverage’s head office, the facility is in the care of Warehouse Manager, Shalandra Lakhan. A cold room and walk-in freezer will be installed early in 2022 to cater for dairy cultures and 60 mobile freezers which run at -45^oC are also being moved there.

The warehouse is part of the business’ ISO 22000 Food Safety Certification process and has been issued with a R638 Certificate, governing general hygiene requirements for food premises. It is an impressive 5 963m² and has space for 4 800 pallets.

Bitumen is the glue that holds the whole asphalt mix together. It aids in compaction during the paving process and provides durability and stiffness. 

At the heart of the programme is Origin Materials’ patented technology which turns inexpensive, sustainable wood residues into carbon-negative, cost-advantaged materials. It reduces the need for fossil fuels and provides stable pricing largely decoupled from the volatile petroleum supply chain. 

Herman Marais, Plant Manager and Technical Director: AECI Much Asphalt, said that this programme is significant due to the vital role of bitumen in asphalt production. “As the binder, it influences the long-term performance of asphalt.

“Bitumen has a high carbon footprint. Turning carbon neutral feedstock into an alternative binder therefore makes environmental sense.” 

AECI Much Asphalt already includes up to 40% reclaimed asphalt in its products. This has resulted in not mining more than a million tonnes of aggregate and not refining approximately 53 500 tonnes of bitumen since 2012. 

“At the same time, the alternative binder is also an opportunity to ensure sustainability in the South African asphalt and bitumen market. With the closing of the Engen refinery and recurrent production challenges experienced by other local refineries, South Africa has become a net importer of bitumen over the past year,” added Herman. 

AECI is a strategic investor in Origin Materials, the world’s leading carbon negative materials company. 

In response to the ongoing bitumen shortage in South Africa, AECI SprayPave is now able to offer the asphalt industry scarce 10/20 penetration grade bitumen. 

10/20 bitumen is commonly used in the production of high modulus asphalt (EME) which is well suited to high trafficked roads likely to suffer significant fatigue and stress. While the demand for EME incorporating 10/20 penetration grade bitumen is growing in South Africa, it is anticipated to increase exponentially when the major N3 freeway contracts are awarded. 

Currently, this grade of bitumen is only supplied by one South African refinery. Other local refineries have been unable to produce 10/20 bitumen due to higher demand for other “normal” grades and difficulty in meeting the required specifications. Unforeseen breakdowns and scheduled shutdowns at refineries add to the problem. 

AECI SprayPave acquired a multistage bitumen converter from Technix Industries in New Zealand, only the second to be commissioned worldwide. The technology enables the business to convert the feedstock bitumen that is available locally to grades that are both lower in penetration and higher in softening point. This can be done predictably and repeatedly. Throughput of 30 tonnes to 60 tonnes per day can be achieved when converting from conventional 70/100 to 10/20. 

A professional society for scientists and other individuals in the cosmetics and allied industries, COSCHEM provides education and training to members. It is based in Johannesburg and is affiliated to the International Federation of Societies of Cosmetic Chemists. A two-year Diploma in Cosmetic Science is available to students across South Africa and is an industry-recognised qualification. 

Charmaine is enthusiastic about her role as the Society’s President. “We are a family that learns together and grows together,” she says. “Since the start of the COVID-19 pandemic in 2020, we have changed the way we do things, connecting virtually for the most part. As an example, we hosted this year’s two-day conference virtually for the first time.” 

Some of the interesting topics covered were:

• 48-hour hydration

• Corn-derived bio polymer in hair-styling

• Fighting digital aging – blue light protection

• Natural ingredients and raw materials

• Next generation green dandruff control

• Reducing eczema using succulents

• Sun care and tanning

Charmaine Du Preez 

Product Manager: Personal Care and Homecare 

An R&D Chemist and Packaging Engineer with Diplomas in Cosmetic Science and Packaging Engineering, she also studied Beauty Technology and Production Management at the Tshwane University of Technology. She has 22 years’ experience in the industry and is a qualified Zumba fitness instructor! 

Jacques Strydom

Technical Manager: Personal Care and Homecare 

Jacques completed his degree in Chemical Engineering at the University of Stellenbosch where he focused on Microbiological Engineering in the field of biofuels, studying microalgae conversion to biodiesel and starch conversion to bio-ethanol. His career took a turn when he started working as an R&D Manager at an FMCG manufacturing company in Cape Town in 2016. Other than his professional aspirations in science, Jacques loves creating art, music, photography and woodwork.

AECI Much Asphalt has supplied several road projects with asphalt mixes containing Ground Tyre Rubber (GTR) in the past year, notably to customers in eMalahleni, Mpumalanga and the Western Cape. The increased attraction of this more sustainable solution has also led AECI SprayPave to manufacture binder containing GTR in-house, using technology that adds significantly to the binder’s shelf life and lowers energy costs. 

GTR enables the use of more binder in the asphalt without the risk of bleeding or excessive deformation due to mix viscosity. Increasing the amount of binder provides longer lifespans for roads and lower rolling noise on the asphalt surface. 

While this technology is not new to South Africa, it is making paving mixes containing waste tyre rubber increasingly popular. 

HOW GTR WORKS IN THE ASPHALT PRODUCTION PROCESS

In the wet process, there is between 18% and 22% GTR in the binder, which constitutes between 5,5% and 7% of the mix. While this does not seem like much, the GTR quantity increases exponentially with the large volumes of asphalt produced for major road surfacing projects. 

In the hot mix process, GTR requires production of the binder on-site as its use is time sensitive. Blenders, digestion and header tanks and feeder pumps are required. 

In the warm mix process, the binder does not have to be mixed on site and can be hauled to the asphalt production plant and utilised without the need for additional equipment. Warm mix asphalt has the added advantage of a lower energy requirement, translating into less environmental impact.  

In 2020, AECI SprayPave commissioned a new mobile blending unit with the capability to produce bitumen at a rate of 25 tonnes per hour, incorporating 25% GTR. It is using between 50 tonnes and 150 tonnes of GTR per month depending on orders for Extended Bitumen Rubber (EBR). EBR blends are produced on a “to order” basis and a significant increase in demand has been noted in the second half of 2021. 

The advantages of EBR are:

• Longer shelf life 

• Long-lasting, maintenance-free and moisture-resistant roads 

• Lower spray temperatures 

• Reduced carbon footprint, energy consumption and emissions

• Reduced viscosity and longer workability (than conventional GTR mixes)

“Knowledge is power and we can only act on what we can measure,” explained Dean Mulqueeny, Group Executive: AECI Water. “We now have the ability to know the exact make-up of discharge wastewater at a speed and level of precision that was previously unobtainable.” 

In the past, municipalities and water treatment plants relied on static laboratory testing and time-consuming manual data processing. Potentially, this meant that problems could go undetected for hours or even days. Other facilities use portable devices but some sensors are not sensitive enough to collect the precise data needed for effective action in real time. In addition, fragmented data, constant calibration concerns, handheld probes and other manual processes add to frustration and inefficiency. 

“Organisations that embrace online real-time monitoring avoid static laboratory testing, eliminate unnecessary calibration and cleaning, minimise controls, optimise chemical feeds and reduce the cost of raw materials,” said Dean. “At the same time, they support emergency response requirements, reduce the risk of polluting the environment, secure compliance and facilitate adherence to ethical and moral business conduct.” 

The skid is fitted with 14 solar panels to provide 46 hours of back-up power and air conditioning to keep the electronics cool. 

AECI Water and the Zambia Environmental Management Agency are in the process of deploying these skids to monitor effluent discharge streams in the country. This will ensure adherence to discharge wastewater regulations for pH, Total Dissolved Solids, Total Suspended Solids and Turbidity. 

KPC commenced coal production in 1992. Today, it moves approximately 500 million bank cubic metres of overburden per year and produces 60Mt of coal. About 80% of the overburden requires drilling and blasting to enable excavation. (A bank cubic metre is the volume of the original rock in situ prior to blasting and excavation.)

Traditionally, the mine has used conventional non-electric initiation in its CMD area, where AECI Mining Explosives has been contracted as the blasting services provider since 2009. This method required a lead-in-line to be run from the blast location to the firing position. In 2017, this method consumed approximately 650 metres of lead-in-line per blast location. At the same time, high daily production targets set by KPC required multiple locations from where blasts could be initiated safely. This sometimes called for clever footwork, particularly in terms of moving expensive capital equipment, and resulted in the loss of production time.

AECI Mining Explosives suggested IntelliShot^® as an alternative because it has the capability to initiate systems wirelessly (known as remote firing).

The AECI Mining Explosives team in Indonesia embarked on a carefully controlled trial to test the applicability of the system and to ensure that KPC got the full benefits.

Much-needed efficiencies were achieved by using a much shorter length of harness wire (100 metres versus 650 metres). The cost of blast initiation reduced by over 50%. Most importantly, the safety-related benefits were significant:

• An advanced security system

• The possibility to easily initiate the blast from longer and safer distances

• The blaster is able to fire from locations that give greater visual security of the blast area during firing

• “Snap, slap and shoot” is eliminated (“snap, slap and shoot” is possible when signal tube detonator plastic tubing is stretched to snapping point. When the plastic tubing recoils after snapping, it can initiate the thin layer of high explosives contained in the plastic tube and cause the detonator to fire or shoot.) 

Yuli Prihartono, Drill & Blast Manager: KPC said that throughout the trial project, AECI demonstrated its capability to deliver an efficient and safe solution to KPC’s world-class operations. “Remote firing has successfully delivered quantifiable cost benefits among others. We expect to expand this initiative by introducing remote firing to all blast locations at CMD KPC.” 

Digital twin 

A digital twin is a virtual representation that serves as the real-time digital counterpart of a physical object or process. The first practical definition of a digital twin originated from NASA as long ago as 2010. 

At AECI Mining, a digital twin is a digital duplication of a production facility (assets, equipment, structures, whole mining sites etc.). Guided by actual/measured operational conditions or constraints, scenarios are simulated to better understand changes made to the process.   

Blast design

Blast design includes the disparate data generated by multiple capturing software programmes in a single repository. The objective is continuous improvement in business intelligence, field applications and operational transparency.

BlastHub™ is a portal that provides predictive software tools to assist with identifying and eliminating inefficiencies in the design process. The vision is to get a closed Performance and Development Review loop, linking products to performance via the cloud.

Smart MMUs

AECI Mining Explosives’ smart MMU is a standard bulk explosives delivery vehicle capable of wireless data communication, including GPS positioning of blast holes

This MMU technology allows for delivery of explosives in hazardous environments through application of computer controlled and propelled delivery systems. It also offers advanced loading capabilities

VR

Another digital technology gaining prominence is VR, a simulated experience that can be similar to, or completely different from, the real world. In partnership with the University of Pretoria, AECI Mining Explosives established a VR Centre at the Department of Mining Engineering. The Centre provides VR training material through consequence training and instructional design. One of the benefits of VR training is that it can be scaled quickly to improve operational efficiencies.

Digital classroom 

Speaking of training, the digital classroom leverages the power of VR to deliver quality training to front-end employees. An example is IntelliShot^® e-learning and VR training.

Automated supply chain

AECI Mining Explosives’ supply chain focuses on a single web-based exchange portal to facilitate mobile Proof of Delivery solutions, real-time material flow, silo monitoring and transport management to enable the three-way match of purchase orders, delivery notes and invoices. It also includes “track and trace” on a global scale. 

The disposal of waste oil is often difficult and problematic on mines and incorrect disposal can lead to severe ground and water contamination. 

The good news is that AECI Mining Chemicals already has extensive experience in the field of waste oil collection and storage. Once certain steps have been followed and the appropriate quality control checks have been completed, the waste oil can be incorporated safely into the emulsion/fuel phase. 

AECI Mining Chemicals has the capability to design an appropriate emulsifier to work with the quality, quantity and type of waste oil available. 

The outcome is reduced cost in the final emulsion/fuel phase, savings in waste disposal due to the replacement of clean virgin solvents with recycled product, and a reduction in the mine’s environmental footprint. 

The technology is currently undergoing field trials following extensive laboratory testing. 

PowerBoost™ outperforms the equivalent pentaerythritol tetranirate (PETN), cyclo-trimethylene trinitramine (RDX) and trinitrotoluene (TNT) boosters. While PETN, RDX and TNT remain dominant globally, their chemical make-up means that they require sophisticated manufacturing plants and specialised raw material storage facilities. 

The use of non-explosive raw materials creates the ability to deploy simple mobile modular plants close to strategically placed manufacturing hubs, lowers manufacturing costs and simplifies logistics. AECI Mining is confident that this innovative product will be market-ready in 2022.

All of AECI Mining’s manufacturing facilities continued to operate and there were no unplanned stoppages. Although at times it was necessary to ration the supply of products to cushion against over-ordering and panic buying, no customer’s business was halted on the basis of zero supply. 

To avoid severe disruptions, AECI Mining prepared a business continuity plan that addressed anticipated challenges and risks long before the multiple national lockdowns in several countries.

According to Denvor Govender, Executive: Global Operations and Supply Chain: AECI Mining, established and traditional business models like deep-tiering were particularly challenged in terms of their readiness and resilience to support a dynamic environment in terms of cost, demand, risk and service. 

“On the one hand, suppliers were unable to produce and ship raw materials due to COVID-19 restrictions. On the other hand, demand for goods skyrocketed, causing a serious imbalance in the global market,” explained Denvor.

Initially, logistical infrastructure delays resulted in the cancellation of shipping, causing global disruption in the movement of cargo and the price thereof. On some trade lanes, the cost of shipping increased by as much as 150%. 

When the lockdowns were eased, panic buying increased logistics costs further as a consequence of supply and demand imbalances. Supply lead times also increased significantly due to changes in liner services and high demand for dedicated charter vessels. 

AECI Mining’s business continuity plan sidestepped these issues through the following interventions: 

• Locking up future raw material supply

• Filling the supply pipeline

• Applying nearshoring principles 

• Avoiding shipping delays by identifying suppliers closer to the point of use

• Ensuring that, from an essential services perspective, the supply chain was geared to manufacture and distribute products 

• Aligning inventory strategically

• Maintaining operating cash flow, thus safeguarding the payment of creditors and suppliers as well as day-to-day operating expenses 

Supply chain 101

Nearshoring – where a business moves operations to a nearby country from one at a greater distance. 

OTIF – a measurement of delivery or logistics performance in a supply chain. Usually expressed as a percentage, it measures whether the supply chain was able to deliver the expected product in the quantity ordered by the customer at the place agreed by the customer at the time expected by the customer. 

Tiering – a form of supply base management in which suppliers are organised in such a way that only first tier suppliers deal directly with the buying organisation. Second tier suppliers participate in the same supply chain, but supply first tier suppliers who assemble or integrate before supplying the buying organisation. The practice originated in the automotive industry and allowed car assemblers to reduce their first tier supply base to below 1 000 suppliers. 

“Better Mining” is one of the goals formalised in our Sustainability Framework because we recognise the importance of making the global mining industry safer and more circular. Zero Harm is at the very core of everything we do, everywhere. 

AECI Australia achieved seven years without a Lost-time Incident (LTI) and AECI Mining in Ghana achieved six million hours worked without one! These milestones would not have been possible without the dedication of everyone involved and their relentless commitment to Zero Harm. 

AECI Much Asphalt and AECI SprayPave

The South African Bitumen Association (SABITA) named Melissa-Ann Jew, SHEQ Manager: AECI Much Asphalt and Eddie Jansen van Vuuren, Director: AECI SprayPave as joint recipients of the 2020 CEO Merit Award for Notable Health, Safety and Environment (HSE) Achievement. 

The SABITA HSE Award recognises noteworthy initiatives by member companies or individual employees who have contributed significantly to the enhancement of HSE management. 

The first recipients of the Awards were announced in 2012. Nominations are received from member companies and nominees must provide details on issues such as the economic benefit of HSE performance enhancement, innovation to promote behavioural change, and the applicability of achievements to the wider industry. 

The nomination for Melissa read as follows: 

“Melissa was appointed during the latter part of 2019. With her capable planning, excellent people skills and passion she drove Total Recordable Incident Rate (TRIR) improvements, putting AECI Much Asphalt among the top performers in the AECI Group and global best practice.” 

Eddie was nominated for his work on a waste bitumen recovery project that ensures bituminous waste and steel drums do not end up on landfills. The project facilitates the separation of waste into components that can be reused, followed by safe disposal of those that cannot.

AECI Specialty Chemicals

AECI Specialty Chemicals reached a TRIR of Zero on 11 June. This means that there had not been a single recordable or reportable injury to employees and contractors alike for 12 months, a remarkable achievement given the diversity of the business’ operations. Hugo Basson, Managing Executive: AECI Specialty Chemicals, expressed his sincere appreciation to everyone for taking Zero Harm seriously and living AECI’s BIGGER values, particularly in terms of being Responsible. 

• SDG 2 Zero hunger
• SDG 2 Zero hunger
• SDG 8 Decent work and economic growth
• SDG 12 Responsible production and consumption
• SDG 13 Climate action

The theme for this year’s World Food Day is “Our actions are our future – better production, better nutrition, a better environment and a better life”. According to the UN’s Food and Agriculture Organisation, whose founding in 1945 is the raison d’être for World Food Day, the food we choose and consume has significant consequences for the well-being of our bodies and world.

UN Secretary-General, António Guterres, recently convened the very first Food Systems Summit to launch bold new strategies to change the way we produce and consume food. To show our support, here are just 10 things we are doing to improve access to good quality food for all.

01. Khula! app

AECI acquired an equity investment in the Khula! app which helps approximately 5,500 emerging farmers grow and sell their produce commercially. The app ecosystem includes three functions: 

• Input Marketplace - emerging farmers buy more than 5,000 products from leading national and international suppliers at competitive prices. These products are collected from an AECI Plant Health depot near them or delivered directly to their farms. There is also access to advisory services and spray programmes

• Funder Dashboard - funders allocate grants and/or loans to selected emerging farmers, depositing funds in the Khula! app for drawdown

• Fresh Produce Marketplace - emerging farmers sell their produce to major markets and supply chains such as hotels, restaurants and shops

02. AgroScout 

AgroScout drones collect high-resolution images from the farmer’s fields and the built-in algorithm detects diseases and pests, indicating their intensity and locations. Farmers adjust their spray programmes accordingly, reducing the cost and use of chemicals. This technology was tested on South Africa’s West Coast at the beginning of 2021 and is in the process of being rolled out to the Free State and KwaZulu-Natal. Potato farmers are the primary target for now. 

03. DrapeNet

Developed in Australia 15 years ago, DrapeNet decreases cross-variety pollination, protects against hail, reduces sunburn damage, saves irrigation water and much more! Previously, Southern Cape farmers suffered huge financial losses from fruit damage and now this cost-effective system is protecting their high-value tree crops. 

04. Empty container system 

After receiving the necessary approvals from the Environmental Affairs Department in Malawi, AECI constructed an empty container management facility to treat empty chemical containers. An independent third party certifies that the hazardous effluent/waste is safe for use in recycling processes for non-human use. This is helping our business in the country become “plastics neutral” in the future. 

05. Crop advisors 

A network of 184 AECI-accredited crop advisors serve South Africa’s farmers with advice and product support in the interests of delivering nutritious, safe food all year round. All aspects of farming – from pest control to soil health – are covered. 

06. Reduced sugar drinks 

To improve sensory profiles, lower the risk of metabolic disorders and maintain great tasting products, AECI supplies innovative sweeteners for fruit juices that contribute to consumers’ daily requirements for natural fibre and vitamins. 

07. Fortified, healthier foods and beverages 

Some of our innovative food solutions are: 

• Collagen protein for bone and joint health

• Plant protein as an alternative source of protein 

• Prebiotic fibre for gut health and immunity 

Some of our innovative beverage solutions are: 

• Botanical extracts that boost cognitive performance and natural energy

• Fermented juices for gut health and immunity 

• Fruit and vegetable juices that enhance the nutrient density of beverages for healthy on-the-go meal replacements 

08. Value-for-money nutritional solutions

Through culture technology, AECI offers solutions for the manufacture of low-cost, value-for-money products such as amasi and mageu as well as baked goods and proteins. 

09. Reduced food waste 

AECI initiated bio-preservation bacterial culture technology at key dairy producers in South Africa that benefit consumers in three ways:

• Extended shelf life of dairy products without artificial preservatives 

• Naturally-improved consistency and quality of dairy products 

• Security of quality throughout the value chain 

10. Greener distribution systems

AECI is the first in Africa to offer the eco-friendly, globally patented Mega-Inliner^® supply chain system. Very simply, Mega-Inliner^® includes a bag and a tank container. The bag is placed in the empty tank container for filling with any non-hazardous liquids. The bag is 100% recyclable. Since all the liquid goes in the bag, the tank container stays clean with no wear and tear. The need for cleaning chemicals, facilities and personnel is removed. No cleaning means that there are significant water savings. Without Mega-Inliner^®, approximately 2,000ℓ of water are used to clean a single tank container. With Mega-Inliner^®, up to five billion litres of water could be saved around the world every year. This is enough water for 300,000 people in Africa annually!

For more on how AECI is shaping “a better world”, go to www.aeciworld.com/sustainability

• Explore the development and construction of Clariter’s full scale plants across parts of AECI’s existing geographic footprint, specifically South Africa as well as Germany and the USA

• Research and develop new specialty chemical applications and blends that have a “green” premium   
  

Since the products are decoupled from crude oil and refinery value chains, they ensure business continuity and price stability. Current results show that they meet FDA purity standards and exceed equivalent benchmarks. 

Plastic waste is a global challenge. 370 million tonnes of plastic is produced annually and only 16% is recycled; 25% is burned and 59% is landfilled or discarded in an uncontrolled way. Since demand for plastic is growing by 3% a year and global volumes will reach 515 million tonnes by 2029, the current waste trajectory is unsustainable. By addressing the circularity of the commodity, Clariter will upcycle 2 million tonnes of plastic waste, produce 1,7 million tonnes of industrial products, and reduce CO2 by nearly 1 million tonnes by the end of 2028. 

In order to do so, Clariter utilises a continuous, proprietary and proven chemical upcycling process that overcomes the challenges faced by mechanical recycling. These include being highly sensitive to the types of plastic suitable for processes and limitations on the number of times plastic can be mechanically recycled. Significantly, Clariter’s process treats nearly all types of plastic (including polyethylene, polypropylene and some polystyrene) in mixed colours and quantities and converts plastic back to original form to deliver drop-in ready replacements for product manufacturers.  

The process comprises three steps, namely:

1. Thermal cracking to convert plastic waste into a wide range of liquid hydrocarbons

2. Hydro-refining to remove impurities and to form naphthenic and paraffinic hydrocarbons

3. Distilling and separating to distil fractions into stable products which can be blended into diverse products   
   

AECI Chief Executive, Mark Dytor, said that there are many reasons why the company is well-placed for this type of strategic collaboration such as “our extensive chemical application expertise, industrial experience, market access in key geographies and product development capabilities”. “It’s also part of our internationalisation strategy which includes growing hard currency earnings.” 

“At the same time, we’re shaping ‘a better world’ through a commitment to ‘better chemistry’. As one of the main features of our recently released Sustainability Framework, ‘better chemistry’ focuses on embracing the principles of green science and technology in developing, manufacturing, packaging and transporting industrial products and solutions. Our strategic collaboration with Clariter will play a meaningful role in this regard.” 

Clariter’s President and CEO, Ran Sharon, added that circular, green processes and products have a meaningful role to play towards sustainability and ultimately a net-zero-carbon future. “A collaborative-driven approach is the essence of Clariter’s strategy. This happens on many levels from building plants to securing offtake agreements. AECI coming on board is a win-win for everyone involved and we’re looking forward to the future!”

Founded in 2003, Clariter is privately-owned, headquartered in Luxembourg and has operations in Israel, the Netherlands, Poland and South Africa. The company has international patents in key geographies, 100 employees of 15 nationalities and a strong management team with extensive expertise in the chemicals industry. 

The technology has been proven at Clariter’s R&D pilot plant in Gliwice, Poland since 2006 and an industrial scale plant in East London, South Africa since 2018. During this time, detailed information has been gathered and there are lessons in areas such as core technology, debottlenecking, feedstock variability, mass energy balances, process flows, scaled engineering parameters and total carbon emissions. The target is to roll out the first full scale plants in Israel, the Netherlands and Poland. 

Clariter won Frost & Sullivan’s 2021 Technology Innovation Leadership Award in the European chemical upcycling of plastic waste industry. Frost & Sullivan’s report indicated that Clariter’s upcycling process shows significant benefits like a net negative carbon footprint. 

This consolidates AECI’s base business in that country and strengthens further the relationship between the two companies which began in 2014 when AECI entered Australia to support this major mining customer.  The two also have long-standing partnerships in Indonesia and in a number of countries on the African continent.

The Australian contract, utilising AECI’s existing in-country capabilities and infrastructure, includes:

• supply of bulk emulsion explosives formulations produced at AECI’s site in Bajool, Queensland, as well as gassing technology for down-the-hole delivery by Thiess

• supply of ammonium nitrate

• supply of the Intellishot® electronic initiating system and booster

Commenting on the contract extension, Mark Dytor, AECI Chief Executive said: “Our relationship with Thiess, as our foundation partner in Australia, exemplifies how we live our AECI BIGGER values of being Bold and Innovative, of Going Green, and of being Engaged and Responsible.  It is built on mutual trust and honesty to the benefit not only of our two businesses but also the global mining sector as a whole. 

“AECI Australia is celebrating the achievement of seven years worked without a lost-time injury.  We are proud to deliver a safer, innovative and cost-effective product offering that enables ‘One AECI, for a better world’.  Better Mining is one of our sustainability goals because we recognise the importance of making global mining safer and more circular.  Significant opportunities exist and we look forward to realising more of these in collaboration with customers such as Thiess.”

Hand sanitisers

Developed in accordance with the World Health Organisation (WHO) guidelines for alcohol-based hand sanitisers, AECI Specialty Chemicals’ hand sanitisers were awarded the South African National Standard (SANS) 490 by the South African Bureau of Standards (SABS).  

Updated and published in October 2020, SANS 490 is a specific standard for alcohol-based hand sanitisers. The changes follow a significant rise in the number of fake test reports and SABS permits as well as incorrect “SABS Approved” logos in the wake of the COVID-19 pandemic. 

The “SABS Approved” hand sanitisers bear the “SABS Approved” logo and the SANS 490 mark. They have undergone the following: 

• Quality management system to ensure that the product is consistent throughout the production process

• Regular audits with samples – from the factory and retailers – to ensure that the product is consistent, fit-for-purpose and safe for use

• Vigorous tests to ensure that the product is compliant with SANS requirements

Current pack sizes are 1000ℓ, 25ℓ, 5ℓ and 500ml.  

Surface disinfectants 

The two surface disinfectants that are available, namely Concentrate and Ready-To-Use (RTU), were tested by SGS, the world’s leading testing, inspection and certification company, in the United Arab Emirates (UAE). A report, proving that the products are effective against SARS-CoV-2, was received. 

Locally, work has also been done on their efficacy against bacterial and spore-forming mould pathogens and a sales permit for the supply of chemical disinfectant from the National Regulator for Compulsory Specifications (NRCS) is in place. The responsibility of the Department of Trade & Industry, the NRCS’s mandate includes promoting public health and safety. This is achieved through the development and administration of technical regulations and compulsory specifications as well as market surveillance to ensure compliance. 

The concentrate is available in 25ℓ and 5ℓ and RTU is available in 5ℓ and 1ℓ spray bottles. 

As the impact of the COVID-19 pandemic led to the shutdown of some of our customers’ operations in the first half of 2020, some of our businesses also slowed down or suspended their activities. This unplanned interruption gave us the opportunity to test our capability to respond innovatively and swiftly to an unforeseen challenge. We sought new adaptive opportunities and found good potential in the production and supply of sanitiser to aid in the response to the global pandemic. 

AECI Specialty Chemicals took ethical responsibility to source pharmaceutical-grade ingredients, secure all required permits and permissions, and set up the necessary laboratory infrastructure for in-house product testing. Further, we worked with the WHO protocols to address any misinformation and ensure our hand sanitiser met credible criteria for efficacy and quality. The task was significant, but we were able to draw on our R&D capability, our network of employees, suppliers and buyers, and our relationships with industry authorities and bodies. 

We launched our product publicly and made use of digital marketing channels to source new customers, sell products in bulk and donate to our employees, contractors and communities.

For its part, AECI Schirm in Germany, also rapidly deployed the manufacture of hand sanitiser and disinfectant to address the need to control the spread of COVID-19 in-country. Initially, a contract for the supply of 1,9 million litres was concluded with the German Department of Interior and executed in full. Thereafter, the business launched its own product range for the German market. Sales in other Eurozone countries could follow.