Energold: Social conscience and technology innovations add to competitive edge

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By Marjo Johne

Two decades ago, few mining exploration companies were open to hearing about Energold’s new modular drilling rig concept. Today, the company’s name and drilling technologies are recognized around the world for efficiency and socially- and environmentally minded practices. 

Vancouver-based Energold’s concept is elegant: a modular rig comprised of smaller pieces that can be assembled on site, so mining operators don’t need to clear trees and build roads to haul in equipment.

Regardless, company president and CEO Frederick Davidson says he faced doubters when Energold first introduced its new technology to exploration companies. “They weren’t sure it could do the job,” he says. “They’d tell us it’s a nice drill, but they need to drill 500 metres. I’d have to tell them that, of course, it could drill 500 metres.”

Despite, their compact size, the machines are formidable and versatile. One Energold rig, for example, weighs about a ton-and-a-half when fully assembled, yet its heaviest component is just 400 pounds, says Mr. Davidson, whose company employs about 1,700 people worldwide. “That rig can drill a hole that's taller than the CN Tower.”

Today, more than 240 Energold drilling rigs – including 95 modular units – are active in 25 countries, including Canada, Mexico, Argentina, Brazil and South Africa, tackling projects involving minerals, oil and water.

In addition to expanding its spectrum of smaller-sized drilling rigs to meet multiple purposes Energold has also applied its modular concept to bring greater mobility to its more traditional rigs.

Like most great innovations, Energold’s modular drilling rigs were born out of necessity. About 18 years ago, the company was applying for a mining license in the Dominican Republic. But because previous mining projects had caused so much environmental devastation in the country, the local government wasn’t too keen on handing out permits for new projects.

One of Energold’s geologists suggested bringing in a small drilling rig.

“It was only after we demonstrated that we can work with minimum impact on the environment that we got a license to work on the mine,” recalls Mr. Davidson. “Once we got the go-ahead, we hired a whole bunch of locals and we literally carried the small rig to the site and drilled the target. The drill was pretty small and we produced a small core, but it worked out well.”

Based on that experience, Energold began developing a drill rig that can be transported to a site in small pieces. Beyond its minimal environment impact, the technology also yielded greater productivity thanks to faster project startup and increased mobility. It also meant jobs for people living near mining sites.

“We work in developing countries where there’s no road infrastructure, or which have heavily forested areas,” says Mr. Davidson. “So we wanted to develop a series of smaller tools that can be moved by people or by various means …that can cause a lot of environmental destruction. As a result, we've done jobs where we haven’t taken out a single tree.”

Energold has used helicopters or Cessna aircraft to transport the biggest pieces of equipment. But for the most part, the company hires local residents – about 15 to 25 workers per project – to help with the heavy lifting and other tasks. This delivers immediate economic and social benefit to the communities around Energold project sites.

As a best practice, Energold also tries to recruit managers from the local labour pool, adds Mr. Davidson.

“We export our technology, but we try whenever possible to keep our presence in a country as local as possible,” he says. “The locals know what's happening on the ground, and it helps to leap barriers when you have a local dealing with other locals, such as industry regulators.”

Energold also contributes to local communities by building much-needed infrastructure. In Haiti, the company provided steel, manpower and drilled the main cable anchors for a bridge. In Mexico, Energold donated four water wells to impoverished communities in Chihuahua. The company continues to work on community projects with non-profit organizations around world.

“By innovating with out-the-box technology, we've given ourselves a unique competitive advantage in North America and around the world,” says Mr. Davidson. “We offer the best of both worlds: greater productivity on a project achieved with a socially and environmentally approach.”

“Energold is a key player in a sector where Canada is a leader,” says EDC Account Manager Raul Duque.

EDC provided Energold with financing to buy specialized drill rigs for a project in Peru, Minera Los Quenuales this year, and has worked with them in the past through their Mexican subsidiary.

“Energold is also fully committed to providing a positive social and environmental impact in every community they’re involved in, and that’s very important to EDC,” adds Duque.

Environmentally and socially minded mining innovation

Frederick Davidson, president and CEO of Energold, shares some wisdom on innovating to build a global competitive edge.

Make innovation part of your business strategy. A willingness to think outside the box landed Energold a hard-to-get license in the Dominican Republic and profoundly altered its business. Today, Energold constantly works to improve its technology and tailors solutions to meet unique project needs.

Build a strong case on multiple fronts. While Energold’s innovations began as a response to a demand for a more environmentally friendly way to drill, the company’s technology also delivers significant business benefits for clients. At the same time, Energold helps to meet social needs by hiring local workers and contributing to infrastructure projects in its mining communities.

Protect your IP. During a visit to China, Mr. Davidson saw a knockoff – albeit an inferior one – of his product, complete with the Energold brand. In addition to having the appropriate intellectual property protection in place, he urges companies to maintain a small circle of trust when it comes to their innovations.

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