South Africa’s up-and-coming coal king is an amiable MBA graduate from the University of Massachusetts and is never really satisfied with himself, his company and the industry he operates in.
Sipho Nkosi, CEO of Eyesizwe Coal, is passionate about creating a world-class company underpinned by profitability, without ignoring worker safety and transformation.
This week one of his company’s mines, the Arnot Colliery in Middleburg, Mpumalanga, suffered an accident when a roof collapsed and killed a worker. Shaken by the fatality, Nkosi seems resolute in his determination to learn from the experience.
”We still have a lot to do,” he says of his industry’s challenge to addressing safety. He cites the Australian mining industry as an example worth emulating. In three years it has reported two fatalities. In South Africa there were 21 deaths last year alone.
The Arnot Colliery is one of four mines Eyesizwe operates in Mpumalanga, producing six million of the company’s 25-million tonnes a year. Eyesizwe’s biggest mine is Matla Colliery, which produces 15-million tonnes a year and, like Arnot, primarily supplies Eskom power stations. Then there is Glisa in Belfast, which services the domestic market. The New Clydesdale mine in Witbank is Eyesizwe’s source of supply for the 1,1-million tonnes it will export this year and would like to see this grow in the next 10 years to five million tonnes a year.
But the desire to grow export will have to be put on hold. Eyesizwe owns a paltry 1,2% of the Richards Bay Coal Terminal, a crucial determinant of volumes to export. Also, at the current commodity price boom, it would be difficult to find someone willing to sell or give up market share.
”It would not be prudent to buy now,” Nkosi says. The strength of the company lies in untapped reserves. The company has about five billion tonnes in reserves, the bulk of which lies in Waterberg, near Elisrus in Limpopo, an area that Nkosi describes as ”the next wave” in coal mining.
Eyesizwe is Sasol’s empowerment partner of choice. At Eyesizwe’s recent results, Sasol CEO Peter Cox paid tribute to its dynamic management team. Cox was impressed with the company’s ”capital, skill and foresight to develop” — ingredients he deems important if one is sincere about building a long-term empowerment relationship. The company also has a joint venture with Anglo to run the R1,6-billion Mafube Colliery near Arnot.
Nkosi frequently points out that the company ”has a long way to go” in all areas, including transformation. Senior management at the mines is 38% black or female. Nkosi does not include head office in Johannesburg in the ratio, which would lift it above 40%. He is encouraged by youngsters currently at junior level and sees them as a long-term strength since the company’s senior level is ageing.
Nkosi wants to see empowerment as more than just targets. ”If you want to play the numbers game, everyone will meet targets,” he says, adding that empowerment players need to focus on how to grow beyond the prescribed 26% set by the mining charter and become operationally involved.
The challenge for Eyesizwe is also to introduce itself properly. Many white people pronounce it ”I-Sizwe”. It is actually ”Eh-yeh- sizwe”, Zulu for ”The Nation’s”.