Bill Millman, AVX

Transcription

Bill Millman, AVX

Achieving a truly conflict free tantalum supply
Global Conflict Minerals Compliance and
Supply Chain Due Diligence
Washington DC, 10th June 2014
W A Millman, Technical and Quality Director
AVX Corporation, Fountain Inn, SC
6/12/2014
AVX CONFIDENTIAL
AVX CONFIDENTIAL
1 ©2012©2012
Challenges
Where is AVX in the supply chain?
2
©2012 AVX CONFIDENTIAL
Challenges
What’s your biggest question, concern,
or hesitation about sourcing from a
conflict-affected or high-risk area?
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EICC Approach to Conflict-Free Sourcing
Finished
Product
MINE
SMELTER / REFINERY
OEMS
In-Region Schemes
Conflict Free Smelter Program
Company Assurance
4
Finished
Product
MINE
SMELTER / REFINERY
OEMS
In-Region Schemes
Conflict Free Smelter Program
Company Assurance
5
Solutions for Hope
Achieving a truly conflict free tantalum
supply chain for the electronics industry
6/12/2014
AVX CONFIDENTIAL
AVX CONFIDENTIAL
6 ©2012©2012
Solutions for Hope
Scope: A pilot initiative to allow
conflict-free tantalum from
the DRC to be used in AVX,
Motorola Solutions, HP and other
participating company products.
Issue: Tens of thousands of
People and their livelihoods have
been threatened by the de facto
ban.
Solution: We worked with a
defined set of suppliers to create a
closed-pipe supply line.
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The ‘Comptoir’ Supply Chain Model
Creuseur
preneurs
Typical Artisanal Mining Supply Chain
Creuseur
preneurs
NEGOTIANT
NEGOTIANT
Creuseur
preneurs
Creuseur
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Creuseur
OEM
COMPTOIR
Creuseur
MAUNFACTURES
NEGOTIANT
SMELTERS
preneurs
INT TRADERS
COMPTOIR
Creuseur
‘Closed Pipe’ Supply Chain
Solutions for Hope: ‘Closed Pipe’ Supply Chain
The “closed pipe” Solutions For Hope pilot provides a
secure chain of custody that meets OECD Guidance
and encourages responsible sourcing from the GLR
MINE*
MMR**
Mining conducted
under concession
from MMR
AVX/SMELTER
AVX take ownership
of material directly
from MMR
* The diggers sell through their cooperative CDMC
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** Mining Mineral Resources
AVX
Motorola
Solutions
Customer has
traceable,
transparent
supply chain
‘Closed Pipe’ Supply Chain
AVX buys the ore at world market prices –
• Secure chain of custody, traceability, monitoring, independent
audit
• More value remaining in region, governmental taxes paid
• Reinvestment – safety, mining equipment & technology, facilities
• Social beneficiation built-in by partner contract
• Building technical capacity on the ground
• Engagement by the end consumers from the start
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Solutions for Hope
AVX Corporation, (July 7th 2011) in partnership with Motorola Solutions, has
developed the "Solutions for Hope Project," a pilot program established to
demonstrate a process to deliver conflict-free tantalum material from the
Democratic Republic of the Congo (DRC) under the Organisation for
Economic Cooperation and Development (OECD) guidelines. The process'
basis is a "closed pipe" principle in which tantalite ore mined from single
sites within the Katanga Province of the DRC is traced along its secure
closed supply chain to the end customer's equipment in the form of
tantalum capacitors supplied by AVX.
Customers as end user participants accepting delivery of parts expanding
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Selecting Conflict Free Mines
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Solutions for Hope
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Independent Third Party Assessment
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Independent Third Party Monitor
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Independent Third Party Monitor
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Solutions for Hope
Central Africa
DRC and 10
Bordering
Countries
Democratic
Republic of
Congo
Republic of Congo, Central African Republic, Sudan
Uganda, Rwanda, Burundi, Tanzania, Zambia, Angola
and Kenya as a transport route
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Material location for AVX
“Closed Pipe Supply”
Katanga Mine Sites
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Solutions for Hope Team Members
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Solutions for Hope Review Team Travel
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EICC/GeSI Co-Chair
Extractives Work Group
Provincial Minister
of Mines Katanga
BGR
AVX
PACT/iTSCi
UN Panel of
Experts Chair
Man with AK-47
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Solutions for Hope – Multi Stakeholder Mine Visits
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Solutions for Hope
•
Shipments processed at the F&X Smelter in
China, converted to tantalum powder
•
Further shipments have been released from
the MMR warehouse in Kalemie, DRC
•
End users visited the AVX facility and F&X to
review material control systems,
•
Media coverage continues to be supportive.
•
Working with Communications to enhance
transparency of the project. Web page has
been developed.
http://www.resolv.org/site-solutionsforhope/
•
Intel, HP, Nokia, Blackberry, Motorola
Mobility, Bosch and two ODMs have signed
up for the program, more are evaluating
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Solutions for Hope
•
Second, western CFS GAM joins SfH pilot
•
SfH Review Team – On the ground assessment
•
Ta mine site is first BGR Green Flag site in Katanga
•
165mT of ore shipped through the closed pipe
•
Web page updated to include summary reports, time lines
and photographs from the SfH Review Team.
http://www.resolv.org/site-solutionsforhope/
•
Investigation into potential expansion into Kivu’s
•
AVX announces exclusive use of CFS in support
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Solutions for Hope
The pilot project supports and is
supported by several implementing
Initiatives:
‒
‒
‒
‒
‒
‒
ICGLR Regional Certification;
Traceability program by iTSCi;
Certification of mines by BGR
‒ Certified Trading Chain;
Due diligence guidance and implementation by the OECD and the UN
Group of Experts;
Conflict-Free Smelter (CFS) program; and
Conflict-Free Reporting Template
Creates an initial flow of tantalum that helps enable miners to work and
conflict-free systems to be developed in the DRC.
New business model leveraging vertical integration and community reinvestment that creates an initial flow of tantalum that helps enable miners
to work and conflict-free systems to be developed in the DRC.
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Results and Participants
Results
• Over 165 metric tonnes shipped
• DRC Green Mine Site - MaiBaridi/Luba
• Targeted for first ICGLR Certificate
• Pilot demonstrated Credible,
Sustainable and Expandable Program
Participating Companies
•
•
•
•
•
•
•
AVX
Coopérative Des Artisanaux Miniers
du Congo (CDMC)
F&X
Flextronics
Foxconn
Global Advanced Mining (GAM)
HP
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•
•
•
•
•
•
•
Intel
Mining Minerals Resources (MMR)
Motorola Mobility
Motorola Solutions
Nokia
Blackberry (RIM)
Robert Bosch GmbH
Solutions for Hope
Well received by Media,
Governments and NGOs.
Coverage includes: Bloomberg, New
York Times, Business Week, GreenBizz,
Mission Critical Communications,
TMCnet, Asia Metals, Afrique
Expansion, Radio France, Bloomberg
Business Week, MMTA and the Enough
Project, GAO Reports
Tweets include: Senator Durbin,
RAISE Hope for Congo
Speech by Ambassador Barrie
Walkley, Apr 12 2012 Philadelphia,
EICC/GeSI Work Shop
Highlighted in U.S. Department of
Labor’s Bureau of International Labor
Affairs (ILAB) has released a new
online tool to help businesses reduce
the use of child and forced labor in
their operations and supply chains.
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29
BLOOMBERG
BUSINESS WEEK
Ta Da!
Your cell phone
is conflict-free
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Freeing Your Cell
Phone from
African Warlords
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Finished
Product
MINE
SMELTER/REFINERY
OEMS
In-Region Schemes
Conflict Free Smelter Program (CFSP)
Company Assurance
32
Solutions for Hope
Next Steps:
•
Continue to solicit participation of other actors
•
Expand the program to include other mines and minerals.
•
Share lessons learned through a formal Solutions for Hope program.
33
Solutions for Hope
Mine location for Solutions for Hope
Kivu “Closed Pipe Supply”
Central Africa
DRC and 10
Bordering
Countries
Democratic
Republic of
Congo
Republic of Congo, Central African Republic, Sudan
Uganda, Rwanda, Burundi, Tanzania, Zambia ,Angola
and Kenya as a transport route
34
Material location for AVX
“Closed Pipe Supply”
Solutions for Hope – North Kivu
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40
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Motorola Solutions and AVX Expand Solutions for Hope in
Democratic Republic of the Congo
Expansion enables sourcing of key mineral from North Kivu without
involvement of illegal armed groups
SCHAUMBURG, Ill. and FOUNTAIN INN, S.C. – March 13, 2014 – Motorola
Solutions, Inc. (NYSE: MSI) and AVX Corporation (NYSE: AVX) today
announced expansion of Solutions for Hope to the Province of North Kivu, the
conflict-prone area of the Democratic Republic of the Congo (DRC). The
innovative Solutions for Hope platform allows tantalum from the DRC to be
used in Motorola Solutions and AVX products without the involvement of
illegal armed groups, or “conflict free.” Tantalum is a material used to
manufacture certain capacitors that enable electronic products and is derived
from the mineral coltan, which is in rich supply in the DRC.
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SfH – Closed Pipe North Kivu
Mine
TYPICAL ARTISINAL MINING SUPPLY CHAIN
NEGOTIANT
Mine
OEM
COMPTOIR
Mine
MAUNFACTURES
NEGOTIANT
SMELTERS
Mine
INT TRADERS
COMPTOIR
Mine
NEGOTIANT
THE “CLOSED PIPE” SOLUTION FOR TRACABILITY IN THE DRC
GIVES A SECURE CHAIN OF CUSTODY THAT MEETS OECD GUIDANCE
MINE*
MHI**
MINING IS CONDUCTED UNDER
LICENCE FROM MMR.
AVX/SMELTER
AVX TAKE OWNERSHIP OF MATERIAL
DIRECTLY FROM MMR
* The miners sell through their cooperative Cooperama
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AVX
CUSTOMER
CUSTOMER HAS A TRANSPARENT
TRACABLE SUPPLY CHAIN
** Mining Company
Solutions for Hope
May 2014
51
SMD TANTALUM CAPACITORS
AVX SMD Capacitor
Series: TLJ
Case: K
Capacitance:100uF
Voltage: 6.3V
Tantalum Powder made from Conflict Free Tantalum as
part of AVX participation in the Solution for Hope Pilot
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www.fairphone.com
http://solutions-network.org/site-solutionsforhope
Solutions for Hope



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SINCE DECEMBER 2011 AVX HAS ONLY SOURCED
TANTALUM POWDER AND WIRE USED IN ITS TANTALUM
CAPACITORS FROM SMELTERS THAT ARE COMPLIANT
WITH THE EICC/GESI CONFLICT-FREE SMELTER
ASSESSMENT PROTOCOL
The AVX closed pipe supply chain allows full traceability of
material from DRC and other Central African countries and
we are able to confirm the material is verified as conflict
free. The material meets the requirements of the DoddFrank legislation and SEC disclosure requirements.
From Jan 2013 AVX incorporated in its products Validated
Conflict-Free Tantalum from verified Sources in the DRC
and surrounding countries.
WW Tantalite Resource Base
Russia & Middle East: 9%
Europe: 1%
North America: 2%
China & SE Asia: 11%
Central Africa: 9%
Rest of Africa: 7%
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Australia:
21%
South America:
41%
Published Metal Pages Ta205 Spot Market Price - $/lb
Largest primary industrial mine shuttered
4 Year Market Trend
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Ore Supply – Mining Mix
Industrial Hard Rock Mines
Large
Scale
Industrial
Hard Rock Mines
Semi
Industrial
High Capital Cost – Inflexible to demand
Long-Term, Take or Pay Contracts
Australia, Canada, Mozambique
Brazil, China, Ethiopia, Russia
Artisanal Mines – (like the DRC)
Lower Capital Cost – Fast response to demand
Up-Front Cash Transactions
Short-Term Agreements
Artisanal
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Africa, South America, Asia
Tantalum Primary Sources
Tanco- Cabot
Closed Mar 2009
Briefly Re-Opened
Closed Jan 2013
Poor Geology
Lovozero
India
Yichun
Nanping
China Other
All major industrial scale mining
entities have
closed or outputs have significantly
fallen
SE Asia
Rocha Sã
Nigeria
Brazil Other
Central Africa
Southern Africa
Marropino - Noventa
Restarted March 2010
Closed March 2013
Debts of $55m
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Kenticha
Closed June 2012
High Radiation
Levels
Wodgina - GAM
Closed Dec 2008
Briefly Re-Opened
Closed Feb 2012
Mibra
5 year
contract
Ta205 Spot Market Price Trend - $/lb
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TAGING
60
Solutions for Hope
Observations:
•
Mine sites with ‘tags’ attracts huge numbers from neighbouring sites
•
Capacity to roll out tagging insufficient to cover ‘green’ sites
•
Creation of a two-tier market, tagged, untagged
•
Much lower prices for untagged minerals
•
Large quantities of untagged minerals over shadow the market
•
Risk of leakage real and present
•
Challenge is to roll out traceability and monitoring programs
•
Move beyond a ‘one size fits all’ solution for traceability?
61

Bill Millman, AVX

Transcription

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