"When our products, equipment, software and people are used in the correct combination, we are able to meet any customer challenge safely, effectively and efficiently. Optimal blasting is a science and therefore requires a lot of intelligence in the execution thereof."

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Edwin Ludick

MANAGING DIRECTOR, AEL INTELLIGENT BLASTING

November 12, 2018

AEL began in 1896 as an explosives company focused on supporting the newly established mining sector in South Africa following the discovery of gold in the Wits Basin. How has the company evolved to become the international business it is today?

AEL Intelligent Blasting is a proudly South African company, our roots stem from the underground mining sector and, over time, the company evolved and developed technologies and offerings catering to both underground and surface operations across a multitude of commodities and mining methods. AEL’s inherent culture of innovation and our pioneering spirit has enabled the company to continuously meet the ever changing requirements of the mining sector whilst venturing into a number of new countries and territories along with our customers. In order to remain relevant and ensure we continue to serve the industry with game changing technologies that aid our customers in achieving safer and more efficient mining, we have consistently invested a large sum of our revenue over the years into the research and development of explosives and blasting related accessories, equipment and software. Examples of this revolution include the introduction of emulsions into the market in 1978, which offered customers water resistant explosives that enabled more effective blast outcomes in wet conditions.  In the 2000’s, AEL launched the 3G electronic detonator offerings that offered customers the ability to achieve optimal blast outcomes through precision timing that could be customized to meet any site-specific requirement whilst greatly improving the safety aspect of blasting through pre-blast diagnostics and better controlled blasting procedures. Recently, the focus has been on ‘greener technologies’ and how we aid our customers in reducing their mining footprint. This focus has led to the introduction of used oils in our product range that offers a more sustainable way of getting rid of waste oils on-site whilst improving the energy output of our explosives during the blast.

As we grew, AEL expanded across the African continent and today, we are established in a number of African countries where we do in-country manufacturing and ensure security of supply through a well-established logistics network. In terms of recent and future growth plans and opportunities, we have successfully expanded into Indonesia, Australia and more recently ventured into Chile and Brazil. Exciting things are yet to come!

The company recently rebranded from “AEL Mining Services” to “AEL Intelligent Blasting.” Can you highlight the reasoning behind this transition?

Upon reflection, we realized that ‘Mining Services’ did not clearly communicate to the market what our core capability and offering was, we are not merely a company that provides goods and services to a mine. Instead, we are thought leaders who seek ways in which to partner with customers and develop unique offerings consisting of fit-for-purpose products, services and technologies to address each customer’s individual needs. It is about demonstrating the ‘intelligence’ that goes into blasting in order to facilitate cost savings and safety enhancements through blasting outcomes. This required the adoption of a new way of thinking, new exciting technology partnerships and a different approach to working with our customers and stakeholders alike to achieve better blasting outcomes and long-term sustainability improvements at our customer sites.

Our value proposition, Intelliblast, represents the fit-for-purpose products and delivery systems that have been researched and developed to meet industry needs through use of market leading technologies and thought leadership. When our products, equipment, software and people are used in the correct combination, we are able to meet any customer challenge safely, effectively and efficiently. Optimal blasting is a science and therefore requires a lot of intelligence in the execution thereof.

Geographically speaking, where does AEL Intelligent Blasting see the greatest opportunity to expand within the African continent?

60% of our turnover is already outside of South Africa, and we still see a lot of opportunity across the continent. We do a lot of data mining and market studies to develop our expansion strategies, specifically looking at our current areas of operations. We also look at exploration, differentiating between the feasibility, pre-feasibility and construction phases. A key insight gained in this exercise is that the Copperbelt is still a huge focus for us because copper is a metal that will play a significant role in the electrification of vehicles. The lithium battery and the drive towards electrification in general will drive the interest in specific commodities, but we also do still see coal as a fundamental player despite the global move towards renewable energy.

Can you highlight the latest innovations AEL Intelligent Blasting has introduced in terms of safety?

Electronic initiation systems and centralized blasting remain a key focus area for us. The inherent safety features of these systems, coupled with precision flexible timing and self-diagnostic capabilities have contributed significantly towards improving safety standards at mines, before, during and after blasting takes place. Further development is underway to make these offerings even safer and more user-friendly in future whilst increasing their capability in terms of predictability of blast outcomes and monitoring. The recently launched IntelliShot is already positioning delivering on its value proposition by offering an integration platform into the pit management system at blast time further enhancing the safety benefits associated with full scale electronic blasting.

The transportation and management of explosives remains a key focus area for the industry in general. A strong drive by authorities to limit the risk profile associated with the transportation and management of explosives exists, this includes trying to reduce the number of actual products classified as explosives during transportation and storage as well as improving track and trace capabilities. This is therefore a key driver behind our product development strategy. Recently, we have launched and converted a number of underground conventional gold mines from packaged explosives to emulsion explosives thereby reducing the risk around explosives management and storage at these sites where illegal mining is rife and explosives control poses a challenge.  Emulsions only become an explosive when mixed in the hole with a sensitiser solution through the PCU delivery system and therefore removes the risk of theft and makes the logistics around movement of explosives a lot easier for the customer. In the next few years things such as non-explosive printable delays will become a reality, whereby customers print their own delay on initiators only once on site again removing the risk of control during transportation from manufacturer to site.

In line with this strategy, we have launched two new products this year: the DigiDet ST and the IntelliBoost. The DigiDet offers the safety and precision of electronic detonators to conventional pyrotechnic systems, therefore enabling controlled blasting whilst the IntelliBoost, a two component booster, enables the safe transport and storage of boosters because only when these two chemicals are mixed on site does the booster become an explosive.

As a company that has operations around the continent, how does AEL ensure it is responsibly contributing to the communities where it operates?

AEL being a proudly African company values our role in the development of the continent and therefore we actively seek ways to sustainably contribute to the economies in which we operate. Therefore our focus is not just on social initiatives and employing local communities but also through different ownership models and in-country manufacturing that assists in developing other industries within these economies. As an example, in Zambia, 25% of our business is publicly listed and therefore ordinary Zambians earn dividends from our successes in that country. Across Africa, there is a trend towards involving more African shareholders and we are therefore actively seeking ways in which to participate in these initiatives in a responsible and sustainable manner.

How does AEL Intelligent Blasting navigate the challenge of operating in vastly different regulatory environments?

From experience, legislation develops in collaboration between mine owners, government, and the suppliers of services. Due to our large operating footprint, we have been exposed to many such bodies and legislations and through time have been able to adopt or share best practices within new and existing markets. We constantly seek ways in which to do things better and therefore are open to dialogue and collaboration with all stakeholders to ensure this is achieved. Therefore collaboration and a willingness to discuss these issues with stakeholders is key.

What message would you send to international investors about the opportunities you see across Africa and the role AEL Intelligent Blasting will play in the continent’s future?

When investing in Africa, you must go in with your eyes wide open, and it is important to recognize that there are many different countries within the continent that each have their own way of operating. You need to do a proper due diligence to understand those differences. Nonetheless, my message is to be bold because I believe the next big wave of global economic growth will come from Africa. We are here to stay, and while there is talk of explosives disappearing and new methods of reaching the ore being developed, in my view explosives will remain the most cost-efficient, environmentally friendly energy source for many years to come.

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