Procurement Becomes Bee Tool [opinion]

Figures obtained from the Chamber of Mines of Namibia Annual Review indicate that for 2013, mining companies spent in excess of N$12 billion on the procurement of goods and services from Namibian suppliers. In excess of N$2 billion in goods and services were procured from previously disaantaged Namibian suppliers. Weatherly PLC’s procurement spend on previously disaantaged Namibian suppliers in proportion to its spend on previously aantaged Namibian suppliers is the highest of all the mining houses in the country, amounting to approximately 66% of its total spend. Roumlssing Uranium spent in excess of N$1.4 billion on previously disaantaged Namibian suppliers out of a total N$2.2 billion earmarked for procurement spending, making it the highest spender on previously disaantaged suppliers of all the mining houses in the country.

Anglo Gold’s Namibian procurement spend at its Navachab operation was the highest of all the mining operators in the country. 75% of its total spend was absorbed locally, amounting to approximately N$424.6 million. Worryingly however was that only 3% of its total spend was geared towards aancing previously disaantaged suppliers.Roumlssing Uranium’s local procurement spending will undoubtedly increase once it starts taking delivery of sulphuric acid from Dundee Precious Metals. Dundee Precious Metals recently held a ground breaking ceremony of its N$2.5 billion plant. Roumlssing Uranium signed a five year off-take agreement with Dundee Precious Metals for 225,000 tonnes of sulphuric acid.Swakop Uranium leads the pack with its total spending on goods and services totalling approximately N$3.5 billion for 2013. No indication was given about its proportion of spend targeted at previously disaantaged Namibians. The N$3.5 billion constitutes only 45%of its total spend on procurement. Namdeb Holdings are the third biggest spenders for the year 2013. Its total spending for the period under review amounted to approximately N$1.6 billion. 23% or approximately N$388 million of its total spend was targeted towards previously disaantaged suppliers.Vedanta Resources plc’s Skorpion Zinc procurement amounted to approximately N$1.03 billion for 2013. An indications of procurement spend on previously disaantaged Namibian suppliers was not given. Dundee Precious Metals’ procurement bill for 2013 stood at approximately N$736 million. N$140 million or 19% of its total spend was targeted to previously disaantaged Namibian suppliers. Procurement spending at Paladin Energy’s Langer Heinrich operation stood at approximately N$613.5 million with only a small proportion targeted to previously disaantaged suppliers, about N$26.7 million. Debmarine’s local procurement spend stood at approximately N$576 million for the year under review. This constitutes 20% of its total procurement spend with no indication of its spend to aancing previously disaantaged Namibians.A feasibility study has been initiated by Debmarine earlier this year to determine the impact using Luumlderitz as a supply base for its five mining vessels off the coast of Namibia.

Source : Namibia Economist