By IAN ROSS
A North Bay mining supplier and fabricator has landed a $3 million contract to supply Barrick Gold with rotary bits at its Veladero gold mine in Argentina.
Activity is brisk at J. N. Precise, a fast-growing company which began manufacturing their own line of rotary blast hole bits to the exploration market only two years ago.
Customer demand for their highly engineered bit has picked up so much, J.N. Precise spun off that successful chunk of business last January into a separate Rotacan company, with eyes on expanding their footholds into Western Canada, the U.S., Argentina and Chile.
They’ve established a South American sales and distribution arm, Rotacan Sudamericana S.A. in Santiago, Chile with plans in the works to establish a distributor in Peru.
The company’s aggressive exporting strategy was enough to win them an Ontario Global Traders Award this past spring.
Established by president Joe Guido in 1989, the CNC (computer numerical control) machine shop serves primarily the mineral exploration industry, as well as the pulp and paper, and construction sectors.
Since late 2004, they’ve also grown the workforce from 72 positions to 95 today, including 22 employees at Rotacan.
Steve Boesche, who is part owner in the new company with Guido, joined J.N. Precise in January 2005 after working for a major mining supply company in North Bay. He speaks German, Spanish and Portuguese.
“We’ve fought every competitor on the planet for that (Barrick) project site and we were awarded 50 per cent of the business based on our past service and performance,” says Boesche, the sales and marketing manager.
Guido was instrumental in pushing hard to land the Barrick contract since mid-2004 when his company secured an initial order for 240 bits. The Veladero mine consumes about 100 bits per month.
Currently, Rotacan produces 150 bits monthly but expects to boost production to 400 units over the next two years.
For Barrick, they’ll be shipping out 50 bits per month and about 1,000 over the year and half of the contract’s life.
When Guido acquired this proprietary technology, it was originally designed for drilling blast holes in open pit mining.
The product had been in development for several years by a bankrupt North Bay start-up company, where Guido was a minor investor.
J.N. Precise spent the past few years fine-tuning the Rotacan for use in soft rock formations starting with coal clients in southeastern British Columbia.
Since then, Boesche says they’ve improved the product for use into harder materials to serve a broader range of rock formations.
“We’ve introduced new models to meet customers’ needs,” says Boesche, who adds his company’s advantage is being more focused and flexible in dedicating themselves to one core product.
They’ll be concentrating primarily on the domestic market in branding themselves as the only Canadian manufacturer of rotary blast hole bits. With so much consolidation in the intensively competitive mining supply market, Boesche says the company wants to offer customers a choice, “and they’re welcoming that.”
J.N. Precise operations manager Ken Perrin says the market has changed quite dramatically since they introduced the Rotacan two years ago. The company posted $4 million in sales in the last fiscal year ending June 30, and already has more than $5 million booked for the next year.
“Basically we’ve tripled our (bit) sales in the last 12 months,” adds Boesche, with steady growth on all fronts in Western Canada, Nevada, Arizona, and now Argentina and Chile.
“We’re starting (in September) in Peru and working on getting in the door at an iron ore mine in Labrador City.”
After cutting the ribbon on a new 25,000-square-foot expansion in late 2004, J. N. Precise is set to expand their 75,000-square-foot plant on Kirkpatrick Street yet again.
The new addition will include a heat-treatment process, which should extending the working life of the rotary bit’s bearings. Previously a partner company in southern Ontario did that work.
“It’s going to streamline the flow of product through the plant, rather than ship out can do it right here,” says Boesche.
The company also maintains a strategic partnership with Earle M. Jorgensen, considered one of Canada’s largest suppliers of tubing and bar stock. The Mississauga-based company occupies 10,000-square-feet of shop space on the J. N. Precise site.
