Media releases

Government Ministers support Mpact’s recycled PET plant

10 May 2016

Opening of a new recycled PET plant by Mpact brings SA a step closer to closing the loop in bottle-grade recycling

Johannesburg, 10 May 2016 – Earlier today, Minister of Environmental Affairs Ms. Edna Molewa officially unveiled Mpact Polymers in Wadeville, Germiston. The new bottle-to-bottle facility will produce recycled polyethylene terephthalate (rPET), which is the recycled raw material used for the manufacturing of new PET bottles from previously used PET bottles. rPET is a substitute for virgin PET, which is derived from crude oil.

The R350-million state-of-the-art operation’s recycling process complies with European Union (EU) Food Safety Authority specifications and is the first in Africa to meet The Coca-Cola Company’s full certification for PET bottles to package the company’s soft drinks.

The operation enjoys the backing of the departments of Environmental Affairs (DEA), Trade and Industry (DTI) and Economic Development (EDD) in promoting job creation, reducing waste to landfill and improving rPET production that will ultimately help to reduce the carbon footprint of the food and beverage industry.

This successful venture illustrates what is possible when industry and the public sector collaborate on initiatives with a positive societal impact, in this case, waste reduction,” says Minister of Environmental Affairs, Ms Edna Molewa.

Mpact Polymers will process 29,000 tonnes of post-consumer PET bottles diverted from landfills each year, to produce 21,000 tonnes of rPET for food and beverage packaging. An estimated 186,000m³ of landfill space will be saved annually as a result, while CO2 emissions will be reduced by approximately 53,000 tonnes each year.

The opening of Mpact Polymers comes at a time when collection and recycling of plastic PET bottles is on the rise in South Africa. According to industry body PETCO, post-consumer PET collection and recycling grew from 16% in 2004 to 52% in 2015 (9,840 tonnes to 73,710 tonnes respectively). PETCO targets to collect and recycle a landmark 70% by 2022. Currently, 68% of all PET material (virgin and recycled) is processed into PET bottles and these are primarily used by the beverage industry.

Commenting on behalf of Mpact, Group CEO, Mr Bruce Strong said, “Today is a reflection of partnerships that work in both the public and private sectors. Together with our industry partners, Coca-Cola South Africa, ABI and PETCO, we have spent a lot of time and effort researching the PET recycling industry and developing a PET recycling business that would be sustainable. Mpact Polymers is backed by the required skills, experience, and infrastructure, to take advantage of the prospects in the collection and recycling of PET bottles in South Africa.

Mpact Polymers also reflects the importance of our government’s manufacturing incentive programmes, which we hope will be granted a greater proportion of the national budget in the future, considering the importance of manufacturing in South Africa. The rPET facility has been granted a Section 12i tax allowance incentive through the DTI, while the Industrial Development Corporation (IDC) has supported its development through a minority shareholding and debt funding.”

Echoing Minister Molewa’s remarks, Mzwandile Masina, Deputy Minister of the DTI, noted that the new plant brought important benefits in terms of job creation. “As government, we are proud to have contributed to the sustainability of the project through the approval of Mpact Polymers as a Greenfield project for the Section 12i tax allowance incentive. We further acknowledge that income opportunities will be created through an estimated 1,000 jobs, as there will be greater demand for collectors, small businesses and buy-back centres - which will assist Mpact in reaching their collection targets.

Mpact will create direct permanent jobs here in Wadeville Ekurhuleni and a number of indirect jobs throughout the country.

The Industrial Development Corporation (IDC), which provided a R210m loan facility as well as R30-million for its 21% equity stake in Mpact Polymers, wants to find new ideas to real world problems.Says chief executive,Geoffrey Qhena, “The enhancement of skills transfer as well as the development of entrepreneurship and promotion of growth within the SMME sector fuels further optimism.”

President of Coca-Cola South Africa, Therese Gearhart, applauds the facility as the first on the African continent to meet Coca-Cola’s full certification exacting standards thus achieving approval to use this rPET in their products. “Our partnership with government and Mpact Polymers is another example of our commitment to reduce the carbon footprint of our drink in consumers’ hands, and puts us one step closer towards our goal of zero-waste to landfill sites; sentiments that our partners echo with the opening of this plant. The advancement of world class technology to commercially produce soft-drink bottles for the Coca-Cola system in Southern Africa made from recycled PET, resonates with our mandate to function as an environmentally responsible corporate citizen while ensuring that we never compromise on the quality that our customers expect of us.”

Alan Clark, CEO of SABMiller says that this facility is directly in line with SABMiller’s Prosper sustainability framework to create value by reducing waste and carbon emissions. “This initiative clearly supports and advances our aspiration for a clean world where nothing goes to waste. By dealing decisively with South Africa’s major concern on the collection and recycling of used PET bottles that usually end up in landfill, we are ensuring that we leave a more desirable environmental legacy for generations to come.”

As an anchor customer for the rPET products which will be processed by this plant and through our partnership with Mpact, recycled PET has become a reality in ABI’s value chain. We are very proud of this milestone and we are honoured to have been able to share the journey with Mpact, Coca-Cola, PETCO, and our government stakeholders in bringing this project to life," adds ABI MD, Velaphi Ratshefola.

Mpact has a long and proud history. Our oldest manufacturing facility has been in operation for nearly 100 years, while we have been recycling in South Africa for over 40 years. We are committed to growth in South Africa and elsewhere. Our entry into PET recycling demonstrates how, through enduring partnerships and collaboration, we can contribute to inclusive, job-rich growth while enhancing manufacturing competitiveness,” concludes Strong.

Notes to editors:

About Mpact

Mpact is one of the leading paper and plastics packaging businesses in southern Africa, listed on the JSE’s Main Board in the Industrial – Paper and Packaging sector. The Group has leading market positions in southern Africa in recovered paper collection, corrugated packaging, recycled-based cartonboard and containerboard, polyethylene-terephthalate (PET) preforms, recycled PET, styrene trays and plastic jumbo bins. These leading market positions allow Mpact to meet the increasing requirements of its customers, and to achieve economies of scale and cost effectiveness at the various operations.

Mpact has 33 operating sites, of which 23 are manufacturing operations, in South Africa, Namibia, Mozambique, Botswana and Zimbabwe. South African-based customers accounted for approximately 90% of Mpact’s sales for the current year, with the balance of sales predominantly to customers in the rest of Africa.

As at 31 December 2015 Mpact employed 4,467 people.

About ABI Bottling (Pty) Ltd

ABI Bottling (Pty) Ltd is a wholly owned subsidiary of SAB (Pty) Ltd and is a bottling partner of Coca-Cola South Africa. It is the biggest bottler for Coca-Cola South Africa representing just under 60% of Coca-Cola’s volumes in South Africa. ABI Bottling operates in four sales regions, namely: Central, North, South and KwaZulu-Natal (KZN). Its territory extends to Gauteng, North West, parts of the Free State and KZN. It has five manufacturing and distribution plants situated at Midrand, Devland, Pretoria, Phoenix and Premier (KZN). ABI Bottling (Pty) Ltd is a responsible corporate citizen and in this context focuses on education, environmental management, youth development and enterprise development.

Furthermore, ABI Bottling (Pty) Ltd is committed to producing and selling its products in a responsible manner to minimise its impact on the environment.

For more information visit www.abi.co.za

About The Coca-Cola Company

The Coca-Cola Company (NYSE: KO) is the world's largest beverage company, refreshing consumers with more than 500 sparkling and still brands and more than 3,800 beverage choices. Led by Coca-Cola, one of the world's most valuable and recognizable brands, our company’s portfolio features 20 billion-dollar brands, 18 of which are available in reduced-, low- or no-calorie options. Our billion-dollar brands include Diet Coke, Coca-Cola Zero, Fanta, Sprite, Dasani, vitaminwater, Powerade, Minute Maid, Simply, Del Valle, Georgia and Gold Peak. Through the world's largest beverage distribution system, we are the No. 1 provider of both sparkling and still beverages. More than 1.9 billion servings of our beverages are enjoyed by consumers in more than 200 countries each day. With an enduring commitment to building sustainable communities, our company is focused on initiatives that reduce our environmental footprint, create a safe, inclusive work environment for our associates, and enhance the economic development of the communities where we operate. Together with our bottling partners, we rank among the world's top 10 private employers with more than 700,000 system associates. For more information, visit Coca-Cola Journey at www.coca-colacompany.com, follow us on Twitter at twitter.com/CocaColaCo, visit our blog, Coca-Cola Unbottled, at www.coca-colablog.com or find us on LinkedIn at www.linkedin.com/company/the-coca-cola-company.

About PETCO

PETCO (the PET Plastic Recycling Company) represents the South African PET Plastic Industry’s combined effort to self-regulate post-consumer PET (Polyethylene Terephthalate) recycling. Formed in 2004 as an industry-driven and financed environmental solution for PET, PETCO is responsible for managing the PET industry's extended producer responsibility (EPR) in South Africa. The company’s mission is to grow the collection and recycling of PET bottles after consumer use. They are funded by a voluntary recycling levy paid by industry (on PET resin purchased) and grants from brand owners and resin producers.

PETCO is extremely proud to have closed the loop in South Africa, and believe that this is where the future growth potential exists.

Released by: Chantal Riley
PR Worx 011 896 1818
chantal@prworx.co.za

On behalf of: Mpact

Source: MPACT