From Stake­holder En­gage­ment to Strate­gic Part­ner­ship: RAL and Rakhoma Sign Over­ture MoA


Mmileng - - Contents -

Roads Agency Limpopo (RAL) and Rakhoma Min­ing Re­sources re­cently en­tered into a Mem­o­ran­dum of Agree­ment (MoA) for a road in­fra­struc­ture pro­ject in Ga-Mo­gashoa, a vil­lage in the Sekhukhune Dis­trict Mu­nic­i­pal­ity of Limpopo Prov­ince.

The pro­ject is for the de­sign and con­struc­tion of an in­ter­sec­tion at Ga-Mo­gashoa and re­ha­bil­i­ta­tion of a por­tion of Road D2219. The stretch of D2219 to be re­ha­bil­i­tated is at Ga-Masha to Mag­neets Hoogte (Mag­net Heights) to Ga-Mo­gashoa near Steelpoort in the Fe­tak­gomo Tu­batse Lo­cal Mu­nic­i­pal­ity.

Rakhoma, hosted on the Geluk Mine prop­erty in Ga-Mo­gashoa, is partly owned by Vanchem Vana­dium Prod­ucts (a com­pany of Duferco Group). Vanchem are the pro­duc­ers of vana­dium, which is con­tained in a spe­cial type of ore used in the steel, aero­space and chem­i­cal in­dus­tries.

Ac­cord­ing to Rick Reato, the Chief Ex­ec­u­tive Of­fi­cer of Vanchem, this re­source was iden­ti­fied in Ga-Mo­gashoa in 2012. The Sekhukhune dis­trict, par­tic­u­larly the Fe­tak­gomo Tu­batse Lo­cal Mu­nic­i­pal­ity, is a bona fide min­ing area.

“From 2013, we were al­ready ac­tive de­ter­min­ing and quan­ti­fy­ing the re­source, go­ing through prospect­ing rights etc,” says Mr Reato.

Mr Reato con­tin­ued, “We wanted to de­velop the re­source. We needed ac­cess to the re­source. When we were in­vited to RAL Stake­holder En­gage­ment in Fe­bru­ary 2018, it was an ideal op­por­tu­nity, it came at an op­por­tune time and we were able to put our pro­ject for­ward, for the in­ter­sec­tion and road.”

In Fe­bru­ary 2018, af­ter a suc­cess­ful par­tic­i­pa­tion at the 2018 In­vest­ing in African Min­ing Ind­aba, Roads Agency Limpopo hosted a pro­duc­tive Stake­holder En­gage­ment and Fundrais­ing Ses­sion with the lo­cal busi­ness and min­ing sec­tor in the Sekhukhune Dis­trict Mu­nic­i­pal­ity. [The story was cov­ered in Mmileng First Quar­ter Edi­tion 2018]

RAL in­ten­si­fied its in­ter­ac­tion with the min­ing sec­tor by iden­ti­fy­ing four op­por­tu­ni­ties for po­ten­tial or fu­ture strate­gic part­ner­ships, es­ti­mated at just over R1,12 bil­lion based on pre­lim­i­nary tech­ni­cal assess­ment, as it steams ahead to ad­dress 1 173km of back­log in the Sekhukhune dis­trict.

RAL CEO Mase­la­ganye Matji says the MoA with Rakhoma is one of the prod­ucts of the ses­sion that the Agency had at Lapeng Guest Lodge on the Wilde­beestkraal Farm on the out­skirts of Burg­ers­fort, where it en­gaged dif­fer­ent mines to share with them RAL’s plans and what it in­tends do­ing in the area.

At the ses­sion, em­pha­sis­ing on the suc­cess of the Agency’s Strate­gic Part­ner­ship Ap­proach, Mr Matji said: “Ev­ery lit­tle amount con­trib­utes; we want you to be part of the so­lu­tion to our coun­try, our prov­ince and to our lo­cal mu­nic­i­pal­ity.”

The venue it­self was do­nated by lo­cal busi­ness­man Werner Smul­ders.

“There are those who com­mit­ted on the same day that they want to fo­cus on spe­cific pro­jects within the Sekhukhune dis­trict. Rakhoma Mine was one of them. And when we started the dis­cus­sions with them we agreed that we will break our agree­ment, for ex­am­ple, into two. The first part of the agree­ment will fo­cus on the in­ter­sec­tion on D2219 which goes to the site where they will be min­ing, at the Geluk Mine,” said Mr Matji at the MoA sign­ing.

The es­ti­mated max­i­mum cost of the pro­ject is R6.5 mil­lion, and Rakhoma will con­trib­ute 100% of the pro­ject cost, with RAL as the im­ple­ment­ing agent.

Mr Reato, who is also the in­terim CEO of this small and new min­ing player in the Sekhukhune area, says the MoA is the cul­mi­na­tion of those dis­cus­sions from the Fe­bru­ary 2018 Stake­holder En­gage­ment and Fundrais­ing Ses­sion with RAL.

“We have had a very nice and pleas­ant ex­pe­ri­ence with the Roads Agency Limpopo,” says Mr Reato.

Ac­cord­ing to RAL’s Mr Matji, the sec­ond phase of the pro­ject will tar­get the Steel Bridge at the in­ter­sec­tion of D2219 and R555 at the eval­u­ated cost of R81m.

“For the sec­ond stage, we will be look­ing at the Steel Bridge, in terms of how we are go­ing to ei­ther re­place or re­fur­bish the struc­ture, break­ing it down into two stages. The first stage be­ing the im­me­di­ate one in terms of deal­ing with the bridge, and for the sec­ond stage we will be look­ing at the medium to long-term op­tions of whether we are go­ing to re­place that bridge or what. In that case, we are go­ing to in­vite other mines who made the com­mit­ment in that ses­sion we had at Lapeng Lodge.”

Since 2015, RAL has suc­cess­fully lob­bied the min­ing sec­tor to con­trib­ute to road in­fra­struc­ture around ar­eas where they op­er­ate.

Five mines have al­ready pledged to work with Roads Agency Limpopo on the Steel Bridge pro­ject, eval­u­ated at R81 mil­lion, and two oth­ers will in­clude it in their next So­cial and Labour Plans’ con­sul­ta­tions.

“This is the start of our new re­la­tion­ship in build­ing the dis­trict. And also in con­tribut­ing to the peo­ple in the area in terms of chang­ing their lives through job cre­ation and also build­ing small busi­nesses that will con­trib­ute to the econ­omy of the dis­trict, the prov­ince and the rest of the coun­try,” says Mr Matji.

Dur­ing the con­struc­tion process, sev­eral job op­por­tu­ni­ties will be cre­ated, and Small Medium and Mi­cro En­ter­prises (SMMEs) will ben­e­fit.

In terms of RAL pol­icy, suc­cess­ful con­tract bid­ders are ex­pected to sub-con­tract 30% (on up­grad­ing pro­jects) and 15% (on the main­te­nance or re­ha­bil­i­ta­tion pro­jects) of con­tract value to small busi­nesses in vil­lages ad­ja­cent to the pro­ject sites, and 10% of con­tract value should be used for em­ploy­ment of lo­cal labour­ers in ar­eas where road up­grades and main­te­nance pro­jects are un­der­taken.

As a caveat, the pol­icy fur­ther states that pro­cure­ment of SMMEs should be lim­ited to the lo­cal­ity of Limpopo Prov­ince with pref­er­ence given in the pri­or­ity or­der of, first to the SMMEs from af­fected vil­lages, then to those within the lo­cal mu­nic­i­pal­ity be­fore ex­plor­ing the dis­trict mu­nic­i­pal­ity labour catch­ment area for skills, ex­pe­ri­ence and train­ing op­por­tu­ni­ties.

The pro­ject will also make it eas­ier for Rakhoma to ac­cess the min­ing site, im­prove ac­cess for the com­mu­nity and en­hance flow of traf­fic to and from Ga-Masha to Ga-Phasha and Ga-Mam­puru to Steelpoort. The es­ti­mated con­struc­tion du­ra­tion of this pro­ject is nine months, and con­struc­tion will be­gin sub­ject to other con­di­tions in the MoA be­ing met.


Roads Agency Limpopo Chief Ex­ec­u­tive Of­fi­cer Mase­la­ganye Matji (sec­ond from left) and his coun­ter­part Rick Reato from Vanchem Vana­dium Prod­ucts, shar­ing a joke with their sup­port team. Flank­ing them is RAL’s Head of Com­mu­ni­ca­tions Maropeng Manyathela (left) and Rakhoma Ad­min­is­tra­tive and Le­gal’s Mbavhalelo Ngob­eni.

RAL CEO Mase­la­ganye Matji and Rakhoma in­terim CEO Rick Reato af­ter the sign­ing of a Mem­o­ran­dum of Agree­ment that will give the new mine ac­cess to the min­ing site.

Rakhoma is ready to con­trib­ute to the up­grades around the sin­gle lane Steel Bridge at the in­ter­sec­tion of D2219 and R555 in Sekhukhune.

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