Jorge Aguirre
COO
Proyectos y Construcciones Virgo
/
View from the Top

Construction Expertise Dovetails with Sustainability Needs

By Pedro Alcalá | Thu, 05/14/2020 - 11:54

Q: What are the defining aspects of Proyectos y Construcciones Virgo’s work in the mining industry?

A: We are a company with over 30 years of experience. When we began, our focus was rural and agricultural development, in particular the building and dismantling of dams. Since then, we have grown and evolved into a larger construction company that can serve a variety of sectors, including industrial, energy, infrastructure and, of course, mining. In the mining industry, we have rehabilitated roads and causeways, reclaimed land and cleared out yards. We have also been involved in the opposite processes, such as reforestation and the repositioning of original flora and fauna after a yard or facility has reached the end of its operational life cycle. We have been heavily involved in the opposite sides of a project’s lifespan, meaning initial development and decommissioning. There are also additional development phases in a mining project that sometimes happen right in the middle of its production phase, such as the expansion of yards, that we have also been involved in.

We are now trying to further expand our service portfolio to get involved in the actual mining activity itself, in particular the building of processing sites and the operation of heavy machinery, such as 777 and 996 trucks. Although we have yet to be awarded a tender in this category, we remain financially and technically prepared to take on these types of tasks by ourselves. We almost exclusively use Caterpillar equipment, so we have a great relationship with them. We also have an internal rule barring us from using assets over three years old. This allows us to deliver a better service and develop a better reputation with all clients, thanks to the resulting lack of deficiencies in our equipment’s operation.

We begin each project with a financial study that informs our choice of equipment to be acquired for that specific project, which we are able to pay for throughout its execution thanks to our previously obtained lines of credit with Caterpillar and also with banks and other financial institutions. This is in addition to our own fleet, which is composed of over 100 vehicles and machines. We do not rent or lease any unit or subcontract any service. Everything is done by our own trained in-house personnel.

Q: What are your most important competitive advantages when compared to other construction companies in the mining sector?

A: For us, the top priority is safety and security, which for mining projects can sometimes be even more important than execution capacity or production increases. The quality and timeliness of our work are also important competitive advantages. Our integrated management system includes controls and standards for quality, environmental performance, safety and security certified by the latest 2018 ISO. We do this to secure our internal processes and our interactions and contracts with all suppliers and clients. We have never had a contract rescinded or canceled, nor have we had clients charge us additional items due to any deficiencies in our delivery. This speaks greatly to clients of our operational muscle and our general capability to deliver high-quality projects on time. I would also have to add social responsibility and community engagement, which has provided a positive environment for our employees.

When it comes to quality, our processes are detailed, starting with the evaluation of the technical profiles of the equipment. Norms, regulations and best practices have to be met when it comes to the characteristics of these units, all the way to the finalization of construction. This applies to all intermediary construction phases, such as concrete placing and steel structure soldering. These standards are linked to environmental effects and safety as well. Our construction work needs to be evaluated through global comparisons established in our risk analysis processes. Clients need to sign off on anything we detect after these analyses have been finalized. Risk must be measured several times throughout a project’s duration, so these approvals must take place periodically. At the time of final delivery, the client must provide extensive feedback, which includes details to be corrected before our contract can be concluded. After that, the contract contemplates a “hidden vices” period, in which we guarantee repair of particular issues with our delivered construction that might show up after we leave.

Q: What role does the mining industry’s overriding concern with sustainability play in your operations and projects?

A: We are very careful to communicate to our clients what their permitting needs are in terms of environmental regulation and best practices. We do not accept contracts without verifying that whoever we are working with is up to speed on the latest requirements from the authorities and regulators, such as SEMARNAT and state-level institutions. We consider ourselves a green enterprise. What that means is that we implement internal procedures, culture and philosophies within our company and teams. We donate trees and other reforestation activities, such as the adoption of median strips. These tasks are an important expression of the larger part we believe that sustainability must play in the mining industry’s agenda. We also focus on waste recycling at all levels, particularly the correct disposal of different types of construction waste and materials.

Maintenance is also an important aspect of sustainability. Frequent maintenance using standard materials is important for safety but can generate more waste, consume more raw materials and in general be less sustainable. This is why we came up with a way of upgrading our materials and using certain types of oils and additives so that we only have to maintain our equipment every 250 work hours instead of every 200. These types of measures were proposed and implemented by our own personnel, which is in a way an expression of the way sustainability is ingrained in our company culture.

Q: What logistical measures do you take to ensure your delivery deadline for your clients, especially given the remote locations of mining work sites?

A: This is an important area of focus for us as well. The supervisory role of operators over contractors and subcontractors like us plays an important part in this matter. Unfortunately, in Mexico this sometimes results in many subcontractors failing to act in a timely fashion unless they are constantly pressured to do so by operators. This also sometimes has to do with how these contractors structure their finances. Many of them bring themselves to points where they can no longer continue working unless they get paid immediately. This is one area in which we have specialized: the administration of our own resources for the duration of a project. These calculations are made on a project-specific basis, taking the project’s length into particular consideration. In this way, we can also measure any delays accurately so that they can be correctly accounted for and compensated for by doubling our personnel and machinery so as to still deliver on time. With that being said, we have not experienced any significant delays. We want long-term relationships with our clients who should see us as strategic partners. That is impossible to accomplish without reliability. In the end, the mining industry runs on financial deadlines. Construction delays have visceral impacts on an operator’s bottom line.

Proyectos y Construcciones Virgo is a Mexican contractor operating in a number of sectors for which it focuses on projects that guarantee safe road access and facility space in addition to decommissioning services, such as land rehabilitation.

 

Pedro Alcalá Pedro Alcalá Journalist and Industry Analyst