"Normet is focused on bringing battery electric vehicles to the Brazilian market, as we believe there will be a high demand for battery-powered equipment due to companies prioritizing decarbonization."

Odilon Mendes

MANAGING DIRECTOR, NORMET BRAZIL

September 15, 2023

How has Normet positioned itself in the Brazilian market in recent years?

Normet has been operating in Brazil since 2009 and currently has 25 employees in Brazil and supplies equipment, spare parts, services, rock reinforcement products and construction chemicals such as resins and polypropylene fibers to most of underground mining and some tunneling companies.

Normet specializes in underground mining, and we have experienced significant growth in the last years despite the challenges we faced. We expect the sales in Brazil to exceed our initial projections for the year.

What have been Normet's key activities in the last 12 months?

Most of our businesses in the past 12 months are related to current customers, which are purchasing new equipment and other solutions, we have also acquired news customers among the different product lines – Equipment, Services and Construction Chemicals. While some companies are considering switching from open pit to underground mining, this is relatively uncommon yet as it can be a lengthy process.

A portion of our company's growth can be attributed to the supply agreements we have established with all our customers and the next step will be opening new warehouses in Brazil to support our growth in Brazil.

Normet is launching its new line of battery electric equipment Normet SmartDrive® in the Brazilian market, and we will start conducting tests in the mines in the coming months. There is a remarkable shift towards electrification in the mining industry, and we are actively monitoring this trend. Additionally, automation is becoming increasingly popular in the market, and Normet is already working on developing technologies to meet this demand.

Normet has already implemented other technologies such as SmartScan, which is already being used with some Brazilian customers, and SmartSpray which will enable a completely automated concrete spraying process.

What factors impact the demand for electrical equipment in Brazil?

Normet Group has been developing Normet SmartDrive®, a modular battery electric vehicle (BEV) architecture product line in the last two years and we are planning to introduce this equipment range to the Brazilian market at the end of 2023. The use of electric equipment has significant safety benefits for workers, as it reduces carbon dioxide emissions in mines, which is particularly important in underground operations that have limited ventilation.

Using electric equipment in mines will demand investments in connectivity and electrical infrastructure but the benefits will surpass those investments in a short period of time. To ensure that electric vehicles can operate according to the available supply and mine profile, we conduct studies to estimate the potential cost reductions and requirements such as charging station locations. At this moment it is still challenging to imagine an all-electric fleet in underground mines but that will soon become a reality as the industry understands the benefit of this technology.

What is your perspective on the development of underground mining in Brazil?

Typically, when we think of mining in Brazil, we think of open-pit mining, which accounts for about 90 to 95% of the country's mines. However, there is a potential for underground mining to grow in the future. We are currently in talks with companies that are starting underground operations in Minas Gerais and we believe some open pit mines will be transitioning to underground. We are optimistic about our future growth in Brazil.

One of the main advantages of underground mining is the widespread perception that it is a more sustainable way of mining, as it has less impact on the environment.

What are Normet's top priorities for the coming months?

Our company is focused on bringing battery electric vehicles to the Brazilian market, as we believe there will be a high demand for battery-powered equipment due to companies prioritizing decarbonization. Additionally, we aim to expand our rental equipment fleet to meet the growing interest in this type of service. Furthermore, we will bring to Brazil our Variomec XS, which is an equipment for underground logistics, that will leverage the safety and comfort in the transportation of personnel and material in underground mines.

Regarding the construction chemicals product line, we are currently investing in the implementation of resin solutions that are already approved by some customers. Additionally, we have observed a rise in the demand for polypropylene macrofibres and we see a substantial potential to expand our market presence in Brazil within this area.

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