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Send  Share  RSS  Twitter  19 Aug 2008

Business: Multi Billion Rand Russian Contract for Sa Company


Recent Gauteng Business News

Leading South African mining contractor Shaft Sinkers has pulled off a major coup by landing its first multi billion Rand contract in the Russian Federation.

The contract valued at $271-million (over R2-billion) is for the construction of a man and material shaft at one of the world’s biggest potash deposits at Gremyachinskoye mine at Kotel’nikovo, approximately 100 km from the Volgagrad region in Russia and is believed to be one of the largest mining construction contracts entered into between a Russian and South African company.

The contracts were signed by Dmitry Strezhnev, the general director of Russian mineral and chemical company EuroChem OJSC with Shaft Sinkers managing director Rob Schroder.

Says Rob Schroder: “This contact is extremely important to the local region of Kotelnikovo as well as the greater Volgograd Region and is part of our company’s determination and strategy to secure and expand our international shaft sinking operations while also maintaining its solid presence in South Africa.”

Shaft Sinkers, which has been in the shaft sinking business for more than 47 years and is one of the world’s leading contractors in this field, will be sinking the shafts and sealing water by means of cementation and grouting as opposed to the more traditional (in Russia) ground freezing method.

Preliminary drilling for the Project commenced in June 2007 while work on the site is due to begin in November and completion of the shaft is scheduled for January 2012.

The work force will comprise a key group of South African expatriates of up to 50 people who will employ and train local workers.

JJ Durand, manager of METS, the design and EPCM (engineering, Procurement, Construction and Management) arm of the Shaft Sinkers group of companies, said the project was highly challenging because of the extreme ground and weather conditions at Gremyachinskoye. The weather varies from winters where temperatures drop to 22 deg below C to summer where they rocket to 32 deg C. Shaft Sinkers has worked under similar conditions at a potash mine in Boulby in the UK.

The challenges ahead are immense but each phase has been meticulously planned.

Says Durand: “Because of the ground conditions and the squeezing pressures found there we will need to concrete line the shaft and install 350 metres of ‘tubbing’ constructed out of cast iron and geared to withstand squeezing ground pressures.”

Another challenge will be to maintain a safety, accident free record throughout the operation, a cornerstone of the Shaft Sinkers philosophy.

EuroChem has been involved in the development of Gremyachinskoye potash deposit for two years. It has already been proven, that the deposit is unique with regard to the size of its potash resources (it is bigger than 1.2 billion tonnes according to geological data) and by the exceptional quality of ore, the content of KCl (Potassium Chloride) is up to 41%.

The total cost of the project is approximately $2-billion (R 15 billion). This is one of the largest investment projects by a private company in the Russian Federation. After the commissioning of the Gremyachinskoye mine in 2012, EuroChem will become the largest Russian company and the fourth in the world producing the entire range of mineral fertilisers: nitrogen, phosphorus and potassium.

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