Sandvik Mining yesterday opened its $50 million Hunter Valley Site facility for the manufacture, assembly and support of surface and underground coal equipment.
The site covers over 16 hectares, with a four hectare expansion area for the future, and is one of Sandvik’s largest manufacturing, assembly, and distribution centres in the world.
In launching the project the company said the manufacturing of Australian designed, developed, and built products would lay at the heart of the new centre.
As more and more manufacturers, including mining manufacturers, move overseas, the Australian-based business of the Hunter Valley site will be one of the centre’s key offerings to businesses and the public.
The centre also offers a strong endorsement to claims by the Minerals Council that some services sectors were growing as fast, if not faster, than the mining industry itself.
With the strong Australian dollar and declining market for Australian manufacturing, the Sandvik project marks the benefits to be had from tapping into the mining boom.
The Heatherbrae site will act to integrate a number of Sandvik’s NSW facilities to a single operation, and will employ around 600 workers and contractors.
Added expansions could boost that number to around 750 employees/contractors as the site outsources fabrication of its parts to nearby businesses.
As an integrated site, the Hunter Valley operation will replace six Sandvik facilities at Tomago, Mayfield, Caves Beach, Redhead, and two at Hexham.
The site’s total turnover is expected to reach $200-300 million a year, including manufacturing, repairs and refurbishments, and spare parts.
A large chunk of these earnings, at around $40 million, will be accounted for by the manufacture of Sandvik’s LS range of load, haul, dump vehicles.
It will also manufacture drill bits and assemble other mining machinery.
Flameproof engines will be built at the site, after which they will be shipped around the world to China and South Africa.
As well as the company’s manufacturing staple, the new site will include new facilities to increase energy efficiency and reduce carbon footprint.
Among the environmental improvements will be a compressor system with a heat recovery module that allows waste energy to be used to heat water.
Sandvik said an estimated 420 tonnes of carbon would be saved per annum with the initiative. A 132kW solar panel system, which the company claims is the largest in NSW, will also power the site’s offices, saving 185 tonnes of carbon emissions.
Sandvik Mining Australia-Pacific president Rowan Melrose said the company had decided to base the new site in the Hunter Valley because of the region’s growing importance in the industry.
He said as one of the two largest coal export regions in Australia the Hunter Valley was a strategically important region to Sandvik. Melrose said the region’s new manufacturing facility would be part of the exciting growth in the area.
"We remain very positive about the near-term and long-term future of the coal industry in Australia – and in particular the Hunter region," he said.
"To continue supporting this growth, we have to continue to invest in facilities that will not only support our existing markets, but will also have the capacity and capability to support the growing demand for both our products and our services.
"This site and our investment in it, is testament to our confidence and belief that the region and its people will continue to play a significant role in Sandvik’s future in Australia."
Melrose said as a key manufacturer of a wide array of mining equipment, Sandvik made an important contribution to the businesses of many Hunter Valley mines.
He said from the new site the company would be able to strengthen its position in the market and be able to better supply services and support to its customers.
"Our role in the coal supply chain in the Newcastle/Hunter region is very significant; we are involved from literally the ‘point of the pick’ on the underground equipment that excavates the coal right through to the very last point of contact as the final product is loaded onto a ship for Australia’s export markets," he said.
"From this new facility, not only do we manufacture and supply all these products, we also offer service and support to help ensure our products continue operating effectively and efficiently, and then we repair and overhaul them."
Sandvik earnt approximately $13 billion last year, of which more than $1 billion was generated from the Australian mining industry.
Mining accounts for 80% of its business in the country.