How do you come back from this? You’ve lost the life savings of scores of poor people who trusted you; the company that was the key to your fortune has abandoned you; your dream of building a mining empire is in tatters and you are broke. What do you do? Go back to the office and go to sleep? Surely not. Tim Tebeila was used to hardship. He was born, the third of seven children, to a laborer in the remote village of Sekhukhune, in Limpopo, in the north of South Africa. From an early age, he walked barefoot through the mountains to school—15 kilometers each way.
“It was very tough. In winter you had to wake up at four o’clock andevery day you were still late. I was lashed for being late every day for two years,” says Tebeila. As he grew up, Tebeila hustled a living selling apples on the streets. “I think entrepreneurs are born, they are not made. It is a talent, like being a soccer player, but you have to nurture that talent.” To make his life even more complicated, Tebeila was drawn into politics and became one of the leaders in the South African Youth Congress. At nights, often he would sleep in the mountains near his home to avoid arrest.
At the dawn of democracy in South Africa, in 1994, Tebeila decided to quit his job to chase his dream of becoming a mining magnate and set up a company, Sekoko Resources. In those days there were very few black entrepreneurs in mining. “My dream was always to own a mine. My dream was to build a conglomerate similar to that of Anglo American. My belief was very simple; when the Oppenheimer family startedAnglo American they started the same way I did. Not by buying other companies, but getting their ownrights and developing them.”
Getting these mining rights proved a nightmare a million miles from the dream. Tebeila was turned down 10 times, and every time he rolled onto the couch in his Polokwane office and wept. In 2002, he used his last R100,000 ($13,500) to pay consultants in pursuit of yet another mining right. He found out too late that the money was non-refundable and ended up losing both the rights and the cash.
In 2004, he identified the asset he felt could make his fortune and prayed for better luck. Soutpansberg was an estimated 200 million tons of metallurgical coal, under 11 farms, covering 8,000 hectares, near Mussina on his home soil of Limpopo. On April 19, 2005, the government granted Tebeila a license for the site and he was set to chance his arm with consultants yet again. The bigger problem was that Tebeila did not have any money left to explore and the banks were refusing to lend. He needed R1.5 million ($195,000) for exploration and struck on the idea—as was fashionable in latter years of black economic empowerment—of gathering the money from the people who lived in the villages near where he grew up.
So on a crisp winter’s morning near Bela Bela, in the heart of the country’s northern Waterberg coalfields, hundreds of curious villagers gathered to hear what their brother planned to do in return for their life savings. “I remember it was a very cold day and I had a stomach problem… There were many people there that day, old people, disabled people and even chiefs from the community. I told them I needed their money and could make them all rich,” says Tebeila.
The next day, a blind woman shuffled into Tebeila’s office and handed over R15,000 ($1,950) in cash—her life savings. “This touched me a lot and it showed belief in the project. The chiefs followed and they represented the community. My feeling was at least we have got people who are backing my dreams and people who believe in my dreams. After all the long stress of turned down applications, this was going to be it.” Full of hope, Tebeila paid R600,000 ($78,000) to a firm of geological consultants and R900,000 ($117,250) to drillers to explore for coal at Soutpansberg. Little did Tebeila know that his worst day—like the coal itself—was lurking just beneath the surface.
The alarm bells started ringing when Tebeila spent weeks chasing up the paperwork from the consultants. To his horror, he found out that the consulting firm—which had been riven by strife—had dissolved almost overnight. To make matters worse, the geologist had fled to Australia with the exploration report under his arm. It meant Tebeila was mired in a project without information, money or hope; where he was landed with being the geologist, lawyer, environmentalist and engineer of a “I couldn’t phone a blind person, who had given her last money, to tell her that I had lost everything.”
“I felt I was down and I would notwake up. I felt really bad. This was my second loss. I got that money out of struggle and it had gone. I was very down, but I never thought of quitting. Every time I had hardship, I always went and slept in my office. I went back and slept on my couch. I slept for four hours. I do this because it is both meditation and praying for an answer. I woke up with the solution.”
The answer lay in a laboratory in nearby Witbank. Because Tebeila was hands-on during the exploration he knew the laboratory used by the consultants and the people who worked there. He sped to Witbank, more in hope than expectation.
In Witbank, lady luck at last cracked a smile on the Soutpansberg coal project. The laboratory was able to salvage two pages of exploration data for Tebeila. Luckily, the two pages contained the all-important drilling data. A lifeline for the coal mine; for Tebeila these flimsy pages were manna from heaven.
The struggle was far from over. Tebeila spent five months trying to sell the idea of a coal mine with his two pages in hand. There was a glimmer of hope when the Brazilian resources giant, Vale—the driving force behind Mozambique’s mighty Moatize coal project—showed interest, but there was a language barrier. Vale needed to send the proposals to Brazil for translation into Portuguese, but this was going to take months and Tebeila neither had the time nor the money.
What did he learn?
“I think I have learned the art of perseverance and how it works. I learned to persevere no matter what. I learned to stick to my dreams. I want to build a new Anglo American and I am doing that.”
At last, the sun broke through the clouds for Soutpansberg. Tebeila got a phone call, while he was driving, from Coal of Africa— an established player in the South African industry.
“Coal of Africa made me an offer to purchase 74% of the assets for R70 million ($9.1 million). They also pledged to spending R100 million ($13 million) to take the project to a bankable feasibility study. “It’s the biggest deal I have ever closed on a cellphone while I was driving. The following day, they signed. Two years later, they offered me R20 million ($2.6 million) for the remaining 26% and gave me the capital to finance my present project, Waterburg Colliery, which will mine up to 15 million tons of coal-a-year by 2019.” Sekoko Resources survived it all, diversified into iron ore, and is set to reach turnover of R10 billion a year ($1.3 billion) by 2019. And what of the people who handed over their last bundles of cash way back in 2005? “They got their dividends. They got all their money back and they made 300% back on what they gave. Some built houses out of that money. I felt very proud,” says Tebeila. So, coal’s well that ends well.