Xstrata will splash out on BEE projects
Global diversified mining group Xstrata plans on investing R3,2billion in transformation and development in South Africa over the next year, with a focus on BEE procurement, community upliftment, job creation and skills development. The announcement was made at the official opening of its joint ferrochrome expansion project with empowerment partner Merafe Resources in Limpopo yesterday.
Xstrata chief executive Mick Davis said: "Last year 44 percent of Xstrata Alloys and 41 percent of Xstrata Coal or R2,8billion of our total procurement spending went to empowerment companies. This year we are aiming for 50percent.
"In many cases, there is clear evidence that aggressively pursuing BEE procurement has resulted in some real cost savings for our business, while advancing historically disadvantaged South Africans' participation in the economy," said Davis.
He said a further R100million would be spent on community initiatives in the areas of education, enterprise development, job creation and health, and R103million would be used for skills development across Xstrata Coal and Xstrata Alloys.
The Xstrata Merafe Chrome Ventures' Lion Project is the largest single-phase ferrochrome expansion in the world and cost R1,67billion.
The project, which took almost two years to complete, created 2700 jobs during the construction phase and 450 permanent jobs.
"Project Lion has created jobs and provided valuable skills training that will be useful for many years to come. We believe that this should be the kind of outcome all direct capital investments achieve," said Davis.