Exxaro reaches out to locals of Lephalale
'Businesses should take advantage of Medupi opportunities'
October 19, 2009
By Lucky Biyase
Diversified resources group Exxaro is establishing relationships with businesses in the Lephalale municipal area in the coal-mining district of Waterberg in Limpopo.
This is ahead of the expansion of its Grootgeluk colliery to serve Eskom's Medupi power plant. There have been increasing concerns from locals, who are agitated about traffic congestion, the influx of foreigners and environmental impacts resulting from the partnership project between one of Africa's largest coal producers and Eskom.
Joe Meyer, Exxaro's general manager of the Grootgeluk Medupi expansion project, told a meeting of the Lephalale Chamber of Business to seek opportunities in the project.
"We should appreciate the fact that we are unique in doing business. But we should participate in the projects that would see ourselves co-existing," Meyer said.
He urged the chamber to participate in the development initiatives and be recipients of procurement programmes.
"There would be business opportunities for all of you to compete in. This would be in packages of R1bn. We are not putting it in small amounts to avoid fragmentation," he said.
This rosy prognosis flies in the face of rising doubts from local communities.
One businessman said: "We are already having problems with the water supply and the sewerage system in the area. How do they intend setting up a huge system worth billions if they fail to address such a simple thing?
Meyer acknowledged that there were challenges to the expansion programme.
"We do have problems, such as accessibility of the mine, local government infrastructure, shortages of skilled people in the area and reaching the mine from the Johannesburg and Pretoria areas. But, if we work together, we can address these issues," he said.
"We are working hand in hand with the premier and the provincial government in addressing some of the problems and we are positive about these initiatives."
"About 1 000 households will be coming to Lephalale in January next year, a move that has been criticised by locals as causing overcrowding of the small town that is already battling with infrastructure development. The move would see the town's size increasing by about 60 percent.
"We are building about 790 housing units for our employees. The first 200 houses are for existing vacancies in our current Grootgeluk and the rest is for the expansion," Meyer said.
The ambitious Grootgeluk Medupi expansion project is estimated to cost a combined R120 billion once implemented.
According to the agreement between the two, Exxaro has to effect its first coal supply to the power station by late 2011.
Exxaro had spent about R9bn in expanding its Grootgeluk mine to supply about 14 million tons of coal a year to the Medupi power plant. Meyer said the area had about 75 billion tons of coal reserves, representing about 40 percent of reserves in the country.
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