Advanced Braking Technology, formerly known as Safe Effect Technologies and the developer of the patented Sealed Integrated Braking System (SIBS), has undertaken a $4.6 million capital raising to fund the establishment of several service centres in key mining regions.
As well as Queensland, Advanced Braking Technology will establish service centres and parts inventories in Kalgoorlie, the Pilbara, New South Wales and South Africa, better equipping mines with the ability to quickly install and service SIBS systems on their vehicles.
Australian Braking Technology chief executive Ken Johnsen told MiningNewsPremium.net the initial priority will be to use the funds to set up service centres in Mount Isa and the Bowen Basin, followed by Broken Hill, Kalgoorlie and South Africa.
“In round figures, it will be just over $1 million into South Africa to set up branches there, there’s about $1.2 million allocated to set up branches on the East Coast, and first and foremost will be Mount Isa.
“Then in the West, there will be $600,000 for the goldfields and the Pilbara,” Johnsen told MNP.
The remainder of the $4.6 million has been allocated towards working capital and the anticipated expenses of the 1 for 2 renounceable rights issue, which will be coordinated by Patersons Securities.
“We want to increase our holdings of stock close to the minesites,” Johnsen said. “We’ll also have technicians there to install [SIBS systems on] vehicles, and to help our customers with the servicing of them.
“The Mount Isa region has got the highest concentration of [SIBS-fitted] vehicles between McMahon’s vehicles at Mount Isa, Xstrata’s vehicles at Mount Isa and BHP Billiton’s vehicles at Cannington.”
Johnsen said currently Advanced Braking Technology had agents in Mount Isa and the Bowen Basin, which sell parts on consignment, and there were third-party workshops to help in servicing existing customers.
“The mining companies that use the systems do a lot of their own servicing as well,” he said. “It’s fragmented and we’ve recognised that we need to do that better. At the end of the day we know our product and we want to control the roll out of it in an approved fashion.
“Historically, we’ve had a reasonable presence in underground coal mines, but the reason we’re looking at the Bowen Basin now is actually [related to] opencut mines.
“The reason the interest is there is that those rains up in the Bowen caused so much trouble with vehicle brakes, it actually spurred a lot of interest in our products,” Johnsen told MNP.
“They get this wet slurry of overburden and coal dusts, and they just chop out the brakes really quickly, so the cost of maintaining their vehicles in the slush is very high.
“Sure, the rains were a one-off, but it’s an ongoing issue when you’re doing conveyor inspections. We’ve still got quite a number of vehicles underground in that region, in Mooranbah North and other colleries.
“One of the things we’re doing up there is we’re working with a company called Innovative Underground Transport, and they’re actually building up a vehicle to meet the underground coal mine specifications.”
Emerald is located in the Bowen Basin, approximately 194km southwest of Mackay.
“We’ve not yet penetrated New South Wales [underground coal mines] because they tend to use purpose-built drift runners and things like that. Now, on the strength of this vehicle they’re building, we’re hoping to also penetrate the New South Wales underground mines because the vehicle will be fully compliant with the Australian standard.”
Key drivers for the take-up of the company’s products are the cost savings generated by reduced maintenance requirements for the fully enclosed brakes, combined with a fail-safe mechanism which is becoming an integral part of many mining companies’ health and safety requirements.
The record date for the Rights Issue is 29 May, with the issue scheduled to close on 20 June 2008.
Advanced Braking Technology says its SIBS braking system is the most significant development in braking technology since the invention of disc brakes 100 years ago.
The system utilises wet friction, with the moving and non-moving brake parts immersed in oil that dissipates heat and reduces wear through lubrication. As a result, the brakes are virtually wear- and maintenance-free and Advanced Braking Technology has said they have the capability to outlast the vehicles they are fitted to.
