mthombo csdp presentation to rythmic meeting may 10

The Petroleum Oil and Gas Corporation of South Africa (Pty) Ltd Reg. No. 1970/008130/07The Petroleum Oil and Gas Corporation of South Africa (Pty) Ltd Reg. No. 1970/008130/07

MTHOMBO Competitive Supplier

Development Programme

Prepared by: Sesakho Magadla

Date: 20 - 05 - 2010

The Petroleum Oil and Gas Corporation of South Africa (Pty) Ltd Reg. No. 1970/008130/07

PRESENTATION OUTLINE

• CSDP Objectives

• CSDP/BBBEE

• Mthombo Programme Objectives

• PetroSA CSDP Plans

• Main Programme Constraints

• Mthombo CSDP Opportunities

• Early Intervention Opportunities

• Programme Milestone Schedule

• Funding Options


CSDP OBJECTIVES

To develop local suppliers to be able to procure goods

and services in such a way as to increase the

competitiveness, capacity and capability of the local supply

base

To ensure that these local suppliers are locally and globally

competitive

To contribute to the Government’s initiatives ( e.g.,

ASGISA, JIPSA, etc.) of increasing economic growth,

employment creation, skills development, and

implementation of BBBEE


Mthombo Project BACKGROUND

• Building of 360 000 barrels per day crude refinery identified for

Coega.

• Conceptual stage is complete.

• Feasibility is complete

• Project undergoing approval process for continuation to the next

stage


Mthombo Programme Objectives

• To ascertain the preparedness of the South African Industry readiness

to participate in Umthombo Construction.

• To facilitate industry readiness through Competitive Supplier

Development Programme.

• To secure funding for Umthombo CSDP initiatives

• To ensure that a minimum of 30% expenditure for CSDP is achievable

• To mentor and coach CSDP participants

• To monitor and control the CSDP initiatives against Umthombo

objectives


Main Programme Constraints

• Time

All initiatives must not be in conflict with the project schedules.

The minimum requirement is that the benefits for the initiatives

must be realised in Engineering Procurement and Construction

(EPC) phase of Umthombo

• Enterprise Development Funding

Collaboration with relevant stakeholders will be critical in ensuring

that funding is secured

• Market Assessment of Existing Suppliers

Access to relevant and accurate information about supplier

capabilities and capacity.

• Market Analysis for New Entrants

Facilitate collaboration with Original Equipment Manufacturer


Mthombo CSDP Opportunities

1 Equipment Furnaces 5.48%

2 Equipment Exchangers 5.04%

3 Equipment Pressure Vessels 11.42%

4 Equipment Rotating - Pumps 3.56%

5 Equipment Roating - Compre/Turbine 4.70%

6 Equipment - special 4.15%

7 Equipment - Solid processing 1.82%

8 Equipment - Utility 2.22%

9 Piping System 13.14%

10 Structural Steel 8.85%

11 Electrical 15.60%

12 Instrumentation & Control System 9.20%

13 Cons Fire proofing 0.43%

14 Cons Coating 4.54%

15 Cons Chemical & Catalyst 0.00%

16 Cons Mobile Equipment 1.29%

17 Cons Subcontractor civil 8.58%

ItemCost Element

Cost element

Contribution


Early Intervention Opportunities

• Bulk materials needed for site development

• Opportunities for strategic early purchase of components (e. g. Tank plate) from RSA manufacturers

• Maintenance support local to Refinery

• Crude loading / storage and product loading / storage.

• Facilities outside the Refinery fence - Opportunity for Equity BOO/BOT Partners – both foreign and RSA/BBBEE

• Transportation of Material and Equipment - Logistics

• Medical, Security and Accommodation services

• Power, Water & Fuels supply

• Waste removal

• Batch plant for concrete

• Formwork

• Scaffolding

• Construction yard / stores administration

• Communications


Programme Milestones Schedule

Preparatory Actions

CSDP Team

Key Stakeholder Engagement

MOU Agreements Draft

Road shows

Rules of Engagement

Early Initiatives

OEM (Initiative Specific Business Plan)

Technical Assessment

Fund Establishment

Developmental Agreements

Developmental initiatives Roll Out

Successful CSDP participants benefit from Umthombo

Pre-Feed Feed

Engineering Procurement & Construction

Project Close-Out


Who can Benefit from Mthombo CSDP?

• Any legally registered existing South African Supplier that is offering

services/materials that may be required by the project.

• Existing suppliers with required capacity and capability but are not

compliant to BBBEE and that requires support in structuring a

BBBEE deal.

• Existing suppliers that intend to expand capability/capacity to match

project requirements and future demand.

• New global suppliers that intend to establish a South African

presence and also be compliant to BBBEE


How can you support Mthombo?

• Sharing of supplier databases

• Sharing lessons learnt from other similar programmes

• Governance (Conflict of interest disclosure)

• Funding

• Collaboration with Industry Association

• Collaboration with with industry communication

mthombo csdp presentation to rythmic meeting may 10

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