Construction due to start on R350m manufacturing facility in Coega IDZ
It has been eight years in the making, but when the latest investor in the Coega Industrial Development Zone (IDZ), MM Engineering, reaches its full production capacity, the firm will be producing a whopping 3 200 metal gas cylinders a day.
This is according to firebrand entrepreneur and MM Engineering chief executive Manana Bogatsu, 42, who was speaking at the vegetation-cleared site where construction of the new R350-million plant will begin in the next three to four weeks.
Johannesburg-based MM Engineering, along with a concrete and a cement company, were recently announced as the three newest entrants into the IDZ, with a collective investment of more than R1-billion in the zone.
“This project started eight years ago and is now coming to fruition,” Bogatsu said.
“On the basis that gas cylinders for LPG are imported into South Africa, an opportunity was identified to establish a cylinder manufacturing plant in the country.
“We have secured Turkish technology company Repkon as our partner, while the establishment of the facility and operations will be funded by the Industrial Development Corporation.”
She said the new facility, which would create 71 jobs, had a production target of 500 000 cylinders during its first phase and year of operation, after which, at full capacity, the plant would produce 1.5 million units a year, or 3 200 cylinders a day.
“We will be sourcing locally, as far as possible, for our operational and production needs. This includes steel,” Bogatsu said.
“In terms of the employment we are creating, we have targets of between 50% and 60% women employees, while every effort will also be made to employ disabled people. In addition, we will be skilling our workforce from scratch.
“The cylinders will initially be marketed and distributed across South Africa.
“After that, we will begin looking at establishing a footprint in the Southern African Development Community states.”
Bogatsu said while operations would be labour-intensive, the plant would be highly automated and able to produce cylinders of various sizes, with production-critical equipment to include a furnace.
“We certainly see huge potential for growth in the general gas sector. Just 3% of overall energy use is derived from gas in South Africa,” she said.
“The cylinders will not carry any branding and, although they will be manufactured for both domestic and commercial use, we plan to market them to companies which already distribute gas products.”
Coega IDZ senior project manager for infrastructure development, Bruno Ponzo, said construction at the site was expected to be completed in about eight months.
“We are hoping to have it completed by December. This will then allow processes and product testing to be done before the proper start of operations in January ,” he said.
Coega Development Corporation’s business development manager for the metals and manufacturing sector, Sadick Davids, said a target of 36.25% had been set for SMME participation in construction.