Harmony Gold Mining Co. Ltd. · JSE:HAR
Harmony Gold Mining — SBGS Mining Conference 2019
31 slides from Harmony Gold Mining's conference presentation, Jun 4, 2019
Slide 1: Electricity Demand Management
ELECTRICITY DEMAND MANAGEMENT SBGS MINING CONFERENCE 4 June 2019 Beyers Nel: COO South African operations
Slide 2: Forward Looking Statements
2 PRIVATE SECURITIES LITIGATION REFORM ACT SAFE HARBOUR STATEMENT FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements within the meaning of the safe harbor provided by Section 21E of the Exchange Act and Section 27A of the Securities Act of 1933, as amended (the “Securit
Slide 3: Agenda
3 AGENDA 1 Who we are 2 Rising electricity costs 3 Harmony’s electricity cost mitigations SBGS Mining Conference: Electricity demand management 4 Harmony’s electricity performance 5 Future electricity saving initiatives
Slide 4: Who We Are
WHO WE ARE
Slide 5: Where We Operate
SBGS Mining Conference: Electricity demand management 5 WHERE WE OPERATE
Slide 6: Harmony's Strategy
6 HARMONY’S STRATEGY Strategy Strategic pillars Progress Risk-based safety approach delivers improvement in safety rates Production guidance achieved for past three consecutive years, on track to achieve Operational SBGS Mining Conference: Electricity demand management excellence annual producti
Slide 7: Rising Electricity Costs
SBGS Mining Conference: Electricity demand management 7 RISING ELECTRICITY COSTS
Slide 8: Electricity Challenge
8 ELECTRICITY CHALLENGE Eskom average tariff vs inflation (CPI) 800 700 2007-2019 SBGS Mining Conference: Electricity demand management Normalised index (2005 = 100) 600 535% 500 400 97% 300 200 100 Electricity crisis - 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Year
Slide 9: Harmony's SA Electricity Cost
9 HARMONY’S SA ELECTRICITY COST Electricity portion of cost (excl. capital) 15% SBGS Mining Conference: Electricity demand management 8% FY2007 FY2018
Slide 10: Harmony's Electricity Cost Mitigation
SBGS Mining Conference: Electricity demand management 10 HARMONY’S ELECTRICITY COST MITIGATION
Slide 11: Challenges Faced by Deep Level Gold Mines
11 CHALLENGES FACED BY DEEP LEVEL GOLD MINES Mining systems are designed for maximum production - current systems are overdesigned for current applications Historically electricity was relatively cheap, thus no real concern Current electricity costs are high SBGS Mining Conference: Electricity
Slide 12: Electricity Cost Breakdown of Deep Level Mines
12 ELECTRICITY COST BREAKDOWN OF DEEP LEVEL MINES Mining 19% Pumping 16% Refrigeration 20% SBGS Mining Conference: Electricity demand management Hoisting Compressed air 7% 16% Surface operations 2% Refinery Ventilation 2% Lighting Hostels & Housing 13% 1% 4%
Slide 13: Eskom's Integrated Demand Management
13 ESKOM’S INTEGRATED DEMAND MANAGEMENT Eskom’s Integrated Demand Management (IDM) started in 2004 Aim: − Eliminate load shedding − Enhance economic growth SBGS Mining Conference: Electricity demand management IDM model: − Eskom provided project funding (initially 100%, later 50:50%) − Project
Slide 14: Harmony's Commitment to Eskom IDM
14 HARMONY’S COMMITMENT TO ESKOM IDM Harmony energy journey started with Eskom IDM Harmony was the first mining company to participate in IDM (2005) IDM funding was utilised to: − Install efficient motors, lights, fans and motors SBGS Mining Conference: Electricity demand management − Automate
Slide 15: Harmony's System Automation
15 HARMONY’S SYSTEM AUTOMATION Automatically System Quantity System automated controlled 1. Compressed air supply Compressed air 40 25 2. Automated underground level demand 3. Stope isolation compressed air control SBGS Mining Conference: Electricity demand management 1. Fridge plant control Fridge
Slide 16: Harmony's Energy Collaboration
16 HARMONY’S ENERGY COLLABORATION ETA/Harmony collaboration aims at improving operational efficiencies Team uses specialised tools and resources to manage electricity costs Scope include: − Maintenance of existing energy cost saving initiatives SBGS Mining Conference: Electricity demand manage
Slide 17: ETA/Harmony Energy Team - Scope of Work
17 ETA/HARMONY ENERGY TEAM - SCOPE OF WORK Auditing and measurements Data integration and centralisation Energy data analytics Identify risks and opportunities SBGS Mining Conference: Electricity demand management Project identification, simulations and feasibility Project implementation
Slide 18: Energy Management Tools
18 ENERGY MANAGEMENT TOOLS Specialised energy management tools utilised − Analyse 14-million data points daily − + 220 systems monitored − + 2 500 graphs available for detailed analytics SBGS Mining Conference: Electricity demand management Notifications: − Exceptions, daily, weekly and monthly
Slide 19: Energy Management Tools
19 ENERGY MANAGEMENT TOOLS ACTIVE MONITORING ANALYSE EXCEPTION SBGS Mining Conference: Electricity demand management REPORT FAULT FINDING AND ACTION
Slide 20: Energy Awareness – Technology and People
20 ENERGY AWARENESS – TECHNOLOGY AND PEOPLE Co-operation of employees essential for energy management performance Continual training / assistance given to control room operators Stakeholders updated regarding energy performance Monthly newsletters distributed to share success SBGS Mining Con
Slide 21: Importance of Maintenance
21 IMPORTANCE OF MAINTENANCE Maintenance essential due to dynamic mine operation Non-maintained operational energy projects loses 53% of savings in year 1* Performance of electricity cost initiatives over time 140 SBGS Mining Conference: Electricity demand management 120 Performance of initiativ
Slide 22: Harmony's Electricity Performance
SBGS Mining Conference: Electricity demand management 22 HARMONY’S ELECTRICITY PERFORMANCE
Slide 23: Our Energy Reduction
23 OUR ENERGY REDUCTION Harmony RSA electricity consumption 3 400 3 200 Annual energy consumption GWh SBGS Mining Conference: Electricity demand management 3 000 2 800 2 600 2 400 2 200 2 000 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 * Moab Operations and discontinued operations
Slide 24: Energy Management Sees Results
24 ENERGY MANAGEMENT SEES RESULTS Harmony underground mine intensity 370 365 SBGS Mining Conference: Electricity demand management 360 kWh / tonne milled 355 350 345 340 FY2015 FY2016 FY2017 FY2018 * Moab Operations and discontinued operations excluded
Slide 25: Reduction in Our Energy Costs
25 REDUCTION IN OUR ENERGY COSTS Harmony RSA electricity cost increase since 2010 Cumulative annual costs (R-million) SBGS Mining Conference: Electricity demand management Actual electricity bill Cost savings * Moab Operations and discontinued operations excluded
Slide 26: Harmony's Usage Relative to RSA Mines
26 HARMONY’S USAGE RELATIVE TO RSA MINES 100% Electricity intensity (MWh / tonne milled) 90% SBGS Mining Conference: Electricity demand management 80% RSA deep gold Harmony intensity mine predicted (deep mines) average 70% 60% 50% * Derived from 2017 and 2018 annual integrated gold mining company re
Slide 27: Line-of-Sight and Digital Twinning
27 LINE-OF-SIGHT AND DIGITAL TWINNING Line of sight to active workplaces (water, ventilation, cooling, compressed air, production, electricity) Data analytics, automated reporting, simulations, etc. Workplace Escalate Transparency Notifications One platform: multiple data sources & logic into
Slide 28: Future Electricity Saving Initiatives
SBGS Mining Conference: Electricity demand management 28 FUTURE ELECTRICITY SAVING INITIATIVES
Slide 29: Future Initiatives and Possibilities
29 FUTURE INITIATIVES AND POSSIBILITIES Capital projects with quick payback (less than 12 months) − Automation of outstanding equipment and processes − Variable speed drive technologies SBGS Mining Conference: Electricity demand management − Hydro-drilling “Line-of sight” and digital twinning in
Slide 30: Our Electricity Forecast
30 OUR ELECTRICITY FORECAST Aim: 2% year-on-year consumption reduction Target initiatives with return on investment (ROI) less than 9 months Usually total ROIs not more than 12 months SBGS Mining Conference: Electricity demand management
Slide 31: Contact Us
CONTACT US HarmonyIR@harmony.co.za +27 (11) 411 2314 / +27 (82) 759 1775