Transforming Richards Bay Minerals

More than five years ago, the management of Richards Bay Minerals (RBM) (50 per cent owned by Rio Tinto) began a transformation of the company to meet the requirements of new mining legislation in the reformed South Africa.

RBM is a leading global producer of titanium slag, pig iron, rutile and zircon based in Richards Bay, KwaZulu Natal. In June 2008, the company will submit a conversion application to the South African government, in advance of the April 2009 deadline by which time all the country's mining companies must have made these submissions.

The application will outline a plan for the sale of a 26 per cent stake in the company to Historically Disadvantaged South Africans, as required under the new legislation, in addition to further proposals concerned with social development, employment equity, and local beneficiation.

In 2002, South Africa's government passed the Minerals and Petroleum Resources Development Act (MPRDA), giving ownership of all mineral rights to the state. The MRPDA gave rise to the Mining Charter - a comprehensive roadmap for broad based economic empowerment within the mining industry.

The Mining Charter is based on a set of seven 'pillars' for transformation, each dealing with a distinct facet of the process, requiring a scored adjustment from all mining companies. The pillars include requirements for ownership, preferential procurement status, human resource development, housing and living conditions, and community and rural development.

Each application will be scored according to how well its transformation plan adheres to the Mining Charter's criteria, and a company will only be considered to hold 'New Order Mineral Rights' once the government's Department of Minerals and Energy (DME) has accepted its application.

RBM has long been a national leader in terms of corporate social responsibility and Black Economic Empowerment. In some areas, the company is already in compliance with, and exceeding, the requirements of the Mining Charter. It already provides its employees with a housing and meal subsidy, and has never accommodated staff in single sex hostels, which dominate some other operations.

RBM is already focused on the development of skills for its employees and the local community, and is presently investigating the possibility of establishing a Faculty of Engineering and Technology at the University of KwaZulu Natal, to address critical skills shortages.