- Kaloti Precious Metals

Transcription

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MAY 2013 • VOL 214 • NUMBER 5
FEATURES
Ministro Hales Approaches Production
Codelco will soon commission the next great Chilean copper mine ..............28
Careful Monitoring: The Key to Pit-wall Safety
As mines get deeper, and economic pressures provide an incentive for
steeper pit walls, the potential for instability increases. E&MJ looks at
some of the systems that can help mine engineers keep an eye out for
signs that all may not be well within the wall. ..............................................32
Mine Water Management: No Simple Recipe
Mining must become more adept at finding acceptable water-source
solutions in an increasingly complex, thirsty world........................................42
Cost-efficient Transport for Open-pit Mines
An innovative technological approach to skip haulage could optimize
costs and energy efficiency in hard rock mines..............................................48
Is Your Business Safe from Metal Accounting Risks?
An automated, systematic approach is required to deliver comprehensive,
timely and validated information ..................................................................54
Vale Creates Super Hubs for Iron Ore Logistics
Using deep-water ports Valemax vessels will lower iron ore shipping
costs for Asian, Middle Eastern and European customers..............................58
Mine Utility Vehicles: Function Dictates Form
From tiny tracked machines no taller than a table to heavy haulers
with light-touch ground pressure, a wide selection of vehicles is
available for moving workers and supplies where they’re needed,
underground or in rough terrain ....................................................................62
Designing Superior Weighing Systems to Improve Safety and Control Costs
What design engineers need to know about measuring weight or force
with load cells, load pins and tension links ..................................................70
Special Report: Mining in Mozambique
Capturing a resource blessing ......................................................................77
A pit-wall failure at Rio Tinto Kennecott Utah Copper’s
Bingham Canyon mine released an estimated 150
million tons of material, filling the pit bottom and
burying a number of trucks and shovels. The company had been aware of and was monitoring ground
slippage long before the slide, and evacuated the
mine in advance. For details of the event and its
aftermath, please turn to p. 4. For a closer look at the
methods used to detect and monitor the slide, turn to
our coverage of slope-stability technology on p. 32.
(Photo courtesy of Rio Tinto Kennecott Utah Copper)
LEADING DEVELOPMENTS
Huge Landslide Halts Ore Production at Rio Tinto’s Bingham Canyon Mine......4
Glencore, Xstrata Merger Set Following Approval..............................................5
Sundance Terminates Agreement with Hanlong................................................5
Troy to Take Over Gold Producer Azimuth ..........................................................6
Coeur Moving its Headquarters to Chicago ......................................................6
AROUND THE WORLD
U.S. & Canada: Vale Commits to Underground Mine at Voisey’s Bay ................8
Latin America: Barrick Suspends Construction on Chilean Side of
Pascua-Lama ................................................................................................14
Australia/Oceania: Newcrest Ramping-up Two Major Projects ......................16
Africa: Ivanplats Secures Power Boost for Kamoa Project ..............................18
Asia: Kaloti Building New Gold and Precious Metals Refinery in Dubai ..........20
Exploration Roundup: Pilot Gold Launches Drill Program in Turkey ..............22
www.e-mj.com
DEPARTMENTS
Calendar ......................................................26
Classified Advertisements ........................118
Equipment Gallery......................................114
From the Editor ..............................................2
Markets ......................................................120
Operating Strategies ....................................98
People ..........................................................12
Processing Solutions ..................................110
Suppliers Report ........................................106
This Month in Coal........................................24
MAY 2013 • E&MJ 1
FROM THE EDITOR
An April for the Archives
During April 2013, the mining business suffered some
setbacks. As can be seen on the cover of this month’s
edition, the miners at Kennecott Utah Copper’s
Bingham Canyon mine now face an uncertain future.
Prices for most metals declined during the month, but
it was the falling price of gold that garnered the most
attention. Many new mining CEOs were preparing first
quarter earnings reports, announcing their plans for
Steve Fiscor/Editor-in-Chief
the future, deciding what paths to pursue, and which
projects to table. Scaling back ambitious plans is
never easy for mining engineers. Sometimes the market or natural forces make
the decision for them.
Bingham Canyon symbolizes the advances the open-pit copper mining and
processing industry has made over the last century. Starting with Daniel C.
Jackling, who was a visionary as far as the approach to mining and processing
a massive low-grade porphyry deposit, the engineers that earned their stripes
at the mine and the Copperton mill revolutionized the copper industry. That’s
why it should come as no surprise that the engineers knew it was going to happen and they were able to prepare for it.
The management team organized a press conference to discuss the situation (See Leading Developments, p. 4). The best news to come of this is that
no loss of life or injuries were sustained. Widely considered the largest manmade excavation, the pit wall failure brought more than 100 years of collective mining expertise to its knees. The recovery plan will have to be equally
ambitious. You can rest assured that the mining engineers at Rio Tinto and
KUC are looking at all available options. One of the recovery options might be
a new approach to haulage (See Open-Pit Skips, p. 48). Pit wall failures are
the sort of things that keep mining engineers awake at night. Many mines have
invested heavily in pit monitoring systems specifically for this reason (See
Careful Monitoring: The Key to Pit-wall Safety, p. 32).
A few days after the events unfolded in Utah, the price of gold fell
dramatically on two consecutive trading days as hedge fund managers began
liquidating gold holdings in exchange traded funds. At the beginning of
April, gold stood at $1,580/oz. It dropped below $1,350/oz, before recovering to $1,460/oz by month’s end (See Markets, p. 120). All of the metal
prices lost ground in April, silver fell to $23.65/oz and copper fell from
$3.45/lb to $3.15/lb. The traders that buy and sell based on daily prices had
an exciting month.
So is it the end of the world? No, not hardly, but it does mean that mining companies will have to be more vigilant about costs. The weakness in
metal prices will have a ripple effect through the ranks from engineers looking at production strategies to CEOs looking at future investments to either
sustain and grow the company’s position. Once again the industry finds itself
in a situation where it has to be prepared to hit the accelerator or apply the
brakes. Hopefully, when we look back a few years from now, the dip in metal
prices will be a blip on an upward path that continues for a long time. What
we will remember about April 2013 will be the landslide at Bingham Canyon.
ENGINEERING AND
MINING JOURNAL
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NEWS-LEADING DEVELOPMENTS
Huge Landslide Halts Ore Production
at Rio Tinto’s Bingham Canyon Mine
Operations at Rio Tinto’s flagship copper
mine, the Kennecott Utah Copper Bingham Canyon complex near Salt Lake City,
Utah, USA, have been severely curtailed by
a massive pit-wall failure that occurred
April 10. Latest estimates from the company indicate the slide, which took place in
the northeast corner of the pit, involved at
least 150 million tons of material and
filled the bottom of the pit to a depth of
300 ft (91 m) in some areas. The landslide
was described by KUC’s president and
CEO, Kelly Sanders, as one of the largest in
mining history.
KUC said it had been aware of increasing ground movement in the area of the
slide and was monitoring the rate of slippage closely for weeks before it occurred.
By the time the slide took place, the mine’s
visitor-center facility had been closed and
removed, employees had been evacuated,
control facilities had been relocated and
mobile equipment had been shifted to
locations considered safe. Even with these
precautions, the unexpected magnitude of
the slide resulted in burial or damage
involving three shovels, 14 haul trucks,
and some ancillary equipment including
drills, bulldozers and graders.
KUC had previously notified the U.S.
Mine Safety and Health Administration
(MSHA) of the impending slide, and said
MSHA personnel were on-site both before
and after the slide occurred. MSHA granted KUC permission for limited access to
the mine after the slide had stabilized, and
the company said its geotechnical specialists were carefully examining the slide
area, using remote-controlled equipment.
Considered the largest excavated hole in
the world, Bingham Canyon is one of the top
producing copper mines in the industry with
2012 output of 163,200 tons of refined
copper, along with 279,000 oz of gold and
9.4 tons of molybdenum. Its annual production accounts for between 1% and 2%
of the world’s mined copper production and
represents about a quarter of annual copper
consumption in the United States.
Although an inevitable production
shortfall from the mine isn’t expected to
significantly affect world copper supply in
2013, the financial impact of reduced
operational levels and possible workforce
4 E&MJ • MAY 2013
Kennecott Utah Copper President and CEO Kelly Sanders, speaking at a news conference following a massive pitwall landslide at the company’s Bingham Canyon copper mine, said he expects KUC’s “employees and organization will rise to the occasion and rewrite history” as the mine recovers from the effects of the slide, estimated to
be one of the largest in mining history. (Photo courtesy Kennecott Utah Copper).
adjustments could quickly reverberate
throughout the northern Utah economy.
The mine employs 2,500 people and spent
more than $1.2 billion in the state in
2011, including $270 million in wages,
benefits and pensions and $765 million in
purchases from Utah firms.
Days after the slide occurred, KUC
asked its 850 mine employees to consider
taking vacation or unpaid time off until it
could assess the situation; it later expanded the request to include the entire KUC
workforce. Workers who chose to report for
work were assigned to jobs, as available,
outside the pit. The event also affected a
number of contractors working at the mine;
for example, Cementation USA Inc., which
was conducting underground work in the
pit as part of the company’s long-term plan
to extend mine life, had to lay off 45 workers after its work area and equipment were
completely buried by the slide.
Sanders, at a press conference held on
April 25 at an observation point on the pit
rim, said early assessments indicated that
90% of the mine’s production equipment
was unaffected by the slide, including the
in-pit crusher and conveyor-system tunnel
that transports 10,000 t/h of crushed ore
through a mountainside to the Copperton
concentrator. He said that within 48 hours
after the slide occurred, workers had
restarted operations to excavate and remove
overburden from the mine’s Cornerstone
layback area, located high on the pit rim
and roughly opposite the area of the slide.
Nevertheless, KUC warned that if geotechnical investigation shows that workers
may re-enter the pit safely to resume operations, 2013 production is estimated to
amount to only 50% of predicted output,
and it will take at least a year for the mine
to again achieve full production.
Emphasizing that KUC was still in the
very early stages of assessing the damage
to the mine and investigating geotechnical
aspects of recovery, Sanders said the operation faces numerous short-term challenges and decisions before it recovers
from the slide. He did not directly address
the possibility of worker layoffs at the press
conference, but said the company would
consult with its unions and hoped to minimize any impact on workers, yet had to
closely control its cost structure against the
backdrop of reduced production.
He outlined a four-month plan that the
company mapped out to return to producwww.e-mj.com
tion. Over the next 30 days, KUC will complete an assessment of pit conditions in
regard to safe return of workers for limited
ore production. In 60 days, it will develop
a strategy for mining-plan recovery and
staffing levels, and over the next 120 days
will develop a long-term plan to increase
mining output from 50% to full production.
(For details of the equipment and technology used by Rio Tinto to monitor ground
movement at Bingham Canyon prior to the
slide, see “Careful Monitoring: The Key to
Pit-Wall Safety,” on p. 32.)
Glencore, Xstrata Merger
Set Following Approval
Glencore International announced on April
16, 2013, that the Ministry of Commerce
of the People’s Republic of China had
approved the merger of Glencore and
Xstrata, originally proposed in February
2012. Regulatory approval from China was
the last obstacle standing in the way of the
merger, and with the approval in hand,
Glencore said it expected the merger to
become effective May 1, 2013, with Xstrata
shares to be delisted on May 2 and “New
Glencore” shares to begin trading May 3.
The approval under China’s anti-monopoly law came with conditions, including
post-merger sale of Xstrata’s Las Bambas
copper project in southern Peru to a buyer
approved by the China Ministry of Commerce and commitments from Glencore
regarding supply of copper, lead and zinc
concentrates to Chinese customers.
The sale of the Las Bambas project
must take place before September 30,
2014 for not less than a pre-determined
price (unless otherwise agreed by
Glencore), with completion of the sale by
June 30, 2015. Glencore will make a public announcement of its offer to sell its
ownership interest in Las Bambas within
three months of April 16, 2013, and will
thereafter keep the Ministry of Commerce
regularly updated regarding its search for
potential purchasers.
If Glencore fails to enter into a binding
sale and purchase agreement for Las
Bambas by September 30, 2014, or fails
to complete the transfer of its ownership
interest by June 30, 2015, then, unless,
otherwise agreed by the Ministry of Commerce, Glencore must appoint a divestiture
trustee to sell by way of auction its ownership interest in one of the following projects: Tampakan in Peru, Frieda River in
Papua New Guinea, or El Pachón or
Alumbrera in Argentina, at no minimum
price, within three months from October 1,
2014, or July 1, 2015, as the case may be.
The Las Bambas project is currently in
full construction mode and is expected to
produce 400,000 mt/y of copper in concentrates, plus significant gold, silver and
molybdenum by-products, for at least its
first five years of operation beginning in
2015. Capital cost to develop the project is
estimated at $5.2 billion.
As of year-end 2012, almost 65% of the
Las Bambas’ construction capital costs had
been committed, including costs for process
plant equipment, bulk materials handling
equipment, mining fleet, EPC/CM services,
and third-party engineering and site construction contracts. All major process plant
equipment was committed and either in
Peru or in transit from global suppliers.
Regarding concentrate sales to Chinese
customers, the Chinese regulatory approval
mandates that for an eight-year period
from January 1, 2013, Glencore will continue to offer to supply Chinese customers
with a minimum of 900,000 dry mt/y of
copper concentrate under long-term con-
tracts. The price for a minimum of
200,000 dry mt/y will in accordance with
the applicable annual benchmark price
agreed between major miners and major
smelters, and the price for the remaining
700,000 dry mt/y of copper concentrate
will have reference to that applicable annual benchmark price.
During the eight-year period and beginning January 1, 2014, if there is an
increase or reduction in Glencore’s forecast
copper concentrate production, the minimum volume of copper concentrate to be
offered for supply to Chinese customers
will be adjusted pro rata.
Also for an eight-year period from
January 1, 2013, Glencore will continue to
offer to supply Chinese customers with
zinc concentrate and lead concentrate
through long-term and spot contracts.
Glencore’s April 16 announcement also
reported that Xstrata CEO Mick Davis had
agreed not to take a six-month role as CEO
and executive director of the combined
company following completion of the merger, as had previously been contemplated.
Instead, Glencore CEO Ivan Glasenberg
will assume the role of CEO of the combined Glencore/Xstrata from the effective
date of the merger.
Sundance Terminates
Agreement with Hanlong
Sundance Resources announced in early
April that it had terminated its Scheme
Implementation Agreement (SIA) with
Hanlong (Africa) Mining Investment Ltd.
under which Hanlong was to have acquired
100% of Sundance. The termination was
based on failure by Hanlong to meet a
funding condition in the SIA and notification from Hanlong that it was unlikely to
meet other required conditions.
As part of an agreement to obtain approval of a pending merger between Glencore and Xstrata, Glencore pledged to sell, post-merger, Xstrata’s Las Bambas copper project
in southern Peru to a buyer approved by the China Ministry of Commerce. Construction and pre-mining activities in the pit are reported to be currently well under way at the
$5.2-billion project. (Photos courtesy of Xstrata)
www.e-mj.com
MAY 2013 • E&MJ 5
Sundance is an Australian junior company based in Perth that is developing the
Mbalam-Nabeba iron ore project, which
spans the border between Cameroon and
Republic of Congo in central-west Africa.
The project includes development of two
mines, construction of a 510-km rail line
dedicated to iron ore transport to the
Cameroon coast, and construction of a
deep-water port capable of servicing bulk
iron ore carriers. Targeted production
capacity is 35 million mt/y.
In the news background of Sundance’s
termination of the Hanlong bid was the
reported detention in late March of
Hanlong CEO Liu Han in connection with a
murder investigation involving his brother
(E&MJ, April 2013, pp. 10 and 14). As of
late April, no further news had developed
with regard to that story.
Hanlong’s takeover bid was first
announced and agreed to by Sundance in
October 2011. With that proposal now
terminated, Sundance will focus its efforts
on discussions with other parties that
have expressed strong interest in the
Mbalam-Nabeba project, Sundance Chairman George Jones said.
The Sundance statement noted that
substantial progress has been made on the
Mbalam-Nabeba project over the past 18
months. Ore reserves and resources have
increased, with probable ore reserves now
totaling 436 million mt at 62.6% iron;
high-grade direct shipping ore indicated
and inferred resources totaling 775.4 million mt at 57.2% iron; and indicated and
inferred itabirite resources totaling 4 billion mt at 36.3% iron.
Troy to Take Over Gold
Producer Azimuth
Troy Resources and Azimuth Resources,
both headquartered in Australia, have
agreed to an all-share takeover of Azimuth
by Troy. Troy has two producing gold operations: the Casposo gold and silver mine in
San Juan province, Argentina and the
Andorinhas mine in Para state, Brazil.
Azimuth has more than 8,700 km2 of gold
exploration permits and licenses in
Guyana, including its advanced West
Omai project.
The Casposo mine produced 70,989 oz
of gold and 937,208 oz of silver during
Troy’s 2011-2012 financial year ending
June 30, 2012. The Andorinhas mine produced 48,632 oz of gold during the year.
Azimuth’s West Omai project has an
inferred gold resource of 1.65 million oz at
6 E&MJ • MAY 2013
Drill rig at the Hick Prospect, West Omai, Guyana project of Azimuth Resources. (Photo courtesy of Azimuth Resources)
an average grade of more than 3 g/mt gold,
and the company expects its engineering
studies of the project to reach the pre-feasibility stage by the end of 2013.
The Troy offer values Azimuth at A$188
million and has been unanimously recommended by the directors and the CEO of
Azimuth. Following implementation of the
offer, current Troy and Azimuth shareholders will hold 55% and 45%, respectively,
of the enlarged Troy. Troy will remain headquartered in Perth, Western Australia and
will maintain its primary listing on the
Australian Stock Exchange and its secondary listing on the Toronto Stock Exchange.
Troy has agreed to provide Azimuth with
bridge funding of up to A$10 million
through a convertible note facility, with the
proceeds to be used by Azimuth to advance
infill drilling and provide working capital to
progress engineering and other studies.
Coeur Moving its
Headquarters to Chicago
Coeur d’Alene Mines announced in March
that it will move its corporate headquarters
from Coeur d’Alene, Idaho, to a location in
downtown Chicago, Illinois, USA. The company expects to complete the move in the
third quarter of 2013 and to hire at least
60 employees at its new Chicago headquarters by the end of 2014.
Coeur also announced that it intends to
change its name to Coeur Mining following
its annual meeting in mid-May.
The city of Coeur d’Alene has been
Coeur’s home since 1985. The company
has 65 employees at its Coeur d’Alene
headquarters. About 20 of these employees
will move to Chicago with the company.
Coeur is the largest U.S.-based primary
silver producer and a growing gold producer. The company produced 18 million
oz of silver in 2012. The bulk of this production came from three wholly owned
mines: The Palmarejo mine in Mexico
(8.2 million oz), the San Bartolomé mine
in Bolivia (5.9 million oz), and the Rochester mine in Nevada (2.8 million oz).
The company also owns the Kensington
gold mine in Alaska and conducts exploration in Mexico, Argentina, Nevada,
Alaska, and Bolivia.
“Relocating our headquarters to Illinois
will improve our access to key stakeholders
and to our operations,” Coeur president
and CEO Mitchell J. Krebs said.
Subsequent to Coeur’s announcement
of its planned move to Chicago, the company announced on April 11, 2013 that it
had agreed to sell its interest in the silver
production and reserves of the Endeavor
mine in Australia and a royalty on production from the Cerro Bayo gold and silver
mine in southern Chile to XDM Royalty
Corp. for up to $67 million in total cash
and XDM equity.
And, on April 16, 2013, Coeur announced completion its acquisition of Orko
Silver Corp. for approximately $350 million in cash and Coeur shares. Orko is
developing one of the world’s largest undeveloped primary silver deposits, La
Preciosa, near the city of Durango, Mexico.
www.e-mj.com
REGIONAL NEWS - U.S. & CANADA
Vale Commits to Underground Mine
at Voisey’s Bay
The government of Newfoundland and
Labrador and Vale have agreed to amendments to Vale’s Voisey’s Bay development
agreement, the centerpiece of the amendments being a commitment by Vale to
develop an underground mine at Voisey’s
Bay. Vale currently operates an open-pit
nickel-copper-cobalt mine and concentrator at Voisey’s Bay near Labrador’s east
coast about 1,200 km north-northwest of
St. John’s, the provincial capital.
The underground mine will have capacity to produce approximately 40,000 mt/y
of nickel in concentrate and will extend
mine life at Voisey’s Bay by at least 15
years. The underground mine will extract
the Reid Brook and Eastern Deeps nickel
deposits adjacent to the current open-pit.
Mine development will begin in 2015, and
ore production will continue beyond 2030.
Newfoundland and Labrador Premier
Kathy Dunderdale said, “The new mine will
provide many hundreds of construction
jobs after sanction in 2015 and even more
operational employment than the current
mine after first ore is achieved in 2019.”
The amendments to Vale’s development
agreement also extended the permitted
construction and start-up schedule for the
company’s hydrometallurgical nickel processing plant at Long Harbour, Newfoundland and Labrador. The deadline for completion of construction had been Febreuary
28, 2013. (See related story on p. 108.)
Current plans are to start operations at
the Long Harbour plant in the second half
of 2013, initially processing imported
nickel matte, with Voisey’s Bay concentrate
being introduced gradually in 2014 once
all of the impurity-removal circuits are fully
operational. The plant will not be ready to
handle all of Voisey’s Bay nickel concentrate production until 2015.
Capital cost for the Long Harbour plant
is estimated at C$4.25 billion. Approximately 5,000 people are currently employed at the site.
Under the amended agreements, the
government also will collect approximately
C$100 million in additional revenue from
Vale over a period of three years.
Regarding the amended agreement, Jeff
McLaughlin, Vice President of Vale’s Newfoundland and Labrador Operations, said,
“Underground mining is the next natural evolution in our operations at Voisey’s Bay, and
this announcement allows us to unlock additional value in this world-class operation.”
Vale, which currently operates an open-pit nickel-copper-cobalt mine and concentrator at Voisey’s Bay, Labrador,
will develop an underground mine adjacent to the open pit and process ore from the new mine at the existing concentrator, shown here. (Photo courtesy of Vale)
8 E&MJ • MAY 2013
Dominion Diamond Acquires
BHP Billiton’s Ekati Interest
Dominion Diamond Corp. (formerly Harry
Winston, Inc.) has completed its acquisition of the interests of BHP Billiton Canada
Inc. and its various affiliates in the Ekati
diamond mine in Canada’s Northwest Territories, as well as the associated diamond
sorting and sales facilities in Yellowknife,
Canada, and Antwerp, Belgium. The Ekati
diamond mine consists of the Core Zone,
which includes the current operating mine
and other permitted kimberlite pipes, as
well as the Buffer Zone, an adjacent area
hosting kimberlite pipes having both development and exploration potential.
On March 26, Dominion Diamond had
announced the sale of its luxury brand diamond jewelry and timepiece division,
Harry Winston, Inc., to The Swatch Group
Ltd. As part of the transaction, the company changed its name to Dominion
Diamond Corp. from Harry Winston Diamond Corp. The sale and name change
completed the transformation of the company into a focused diamond mining company. With the acquisition of BHP
Billiton’s Ekati interest, Dominion Diamond now holds an 80% operating interest in Ekati and a 40% interest in the
Diavik diamond mine, which is also located in the Northwest Territories.
Commenting on the Ekati purchase,
Dominion Diamond Chairman and CEO
Robert A. Gannicott said, “We are very
pleased to be able to bring our northern
mining background and diamond marketing skills to bear on a project that is well
constructed, well-operated and wellendowed with resources that represent a
promising future for shareholders, employees and northern stakeholders.”
The total purchase price for BHP
Billiton’s Ekati interest was $553 million.
Dominion Diamond said it would soon
issue a detailed mine plan for Ekati.
The Ekati diamond mine is located 310
km northeast of Yellowknife and includes
both open-pit and underground operations.
It was Canada’s first diamond mine, having
begun production in 1998, and remains
Canada’s largest diamond mine. The mine
is located near the Diavik diamond mine,
where Rio Tinto is 60% owner.
www.e-mj.com
REGIONAL NEWS - U.S. & CANADA
U.S. Mine Fatalities at
All-time Low in 2012
The U.S. Mine Safety and Health
Administration (MSHA) reported in early
April 2013 that preliminary data indicate
that the mine fatality rate in 2012 was the
lowest in the history of U.S. mining, with
0.0107 deaths per 200,000 hours
worked. The rate of reported injuries was
2.56 per 200,000 hours worked, also the
lowest rate on record.
“While one death is too many, and
there are still improvements needed to
reduce injuries, it is important to take a
moment and acknowledge progress toward
those goals,” the MSHA statement said.
“These improvements are the result of
the work and dedication of all in the mining community, including MSHA, mine
operators, miners and their representatives, and others.”
Although the number of mines in the
United States decreased slightly to 14,058
in 2012 from 14,176 in 2011, the number of miners employed in the industry
increased to 387,671 from 381,209.
Thirty-five miners died on the job in
2012, two fewer than in 2011 and equal
to the record low number of mining deaths
set in 2009. With the increase in employment compared to 2009, this resulted in a
record low fatality rate.
The number of citations and orders
MSHA issued fell 11% from 157,052 in
2011 to 140,007 in 2012. “These decreases in deaths, injuries, and safety and
health violations reflect improved compliance by operators and safer working environments for miners,” MSHA said.
The metal and nonmetal mining industries established a record low fatality rate
of 0.0080 deaths per 200,000 hours
worked in 2012. Sixteen miners died in
on-the-job accidents, equaling the record
low set in 2011. The reported injury rate of
2.19 per 200,000 hours worked was also
a record low.
Metal and nonmetal mines experienced
a continued reduction in citations and
orders, dropping from 63,601 in 2011 to
60,680 in 2012, a 5% reduction.
While the number of metal and nonmetal
mines remained steady in 2012 at 12,193,
the number of miners increased from
237,772 in 2011 to 250,310 in 2012.
In coal mining, 19 miners died in onthe-job accidents, the second fewest ever.
The fatality rate was 0.0151 deaths per
200,000 hours worked, also the second
lowest ever recorded. The rate of reported
injuries was 3.15 per 200,000 hours
worked, the lowest injury rate ever recorded in coal mining.
The number of citations and orders
issued to coal mine operators declined
from 93,451 in 2011 to 79,327 in 2012,
a 15% reduction.
The coal mining industry saw some
decrease in the number of mines, from
1,973 to 1,865, and in coal production,
from 1,095 million to 1,017 million st,
between 2011 and 2012. While the number of coal miners also decreased, from
143,437 in 2011 to 137,361 in 2012,
the number of coal miners was still the
second highest for any year since 1994.
Veris Enters into Two Toll
Milling Agreements
Veris Gold has entered into toll milling
agreements with Atna Resources and
Klondex Mines to process ores from their
The U.S. mining industry’s fatality rate in 2012 was the lowest in history, according to data compiled by MSHA.
10 E&MJ • MAY 2013
nearby operations at Veris’s Jerritt Canyon
mill in Elko county, Nevada. The agreements are structured such that Atna and
Klondex will pay toll milling fees for the
processing of their ores, and all doré produced from the ores will remain the property of the mining companies.
Veris announced its toll milling agreement with Atna on March 27, 2013. The
agreement has a one-year term. Ore produced from Atna’s Pinson mine in
Humboldt county, Nevada, will be delivered to the Jerritt Canyon mill, and Atna
will pay Veris a toll milling fee that will be
adjusted on a quarterly basis to reflect any
changes to input costs associated with processing the ore.
All doré produced will remain the property of Atna throughout the process, and
Veris will treat the associated toll milling
fee charged to each ton as a credit to Jerritt
Canyon operating costs.
James Hesketh, president and CEO of
Atna Resources, said, “This agreement provides additional processing flexibility, with
a smaller lot size for Pinson and an outlet
for our oxide-sulphide transition ores.”
Veris announced its agreement with
Klondex on April 2, 2013. Veris will
process non-refractory gold ore produced
from Klondex’s Fire Creek project in Lander
county, Nevada, with Klondex paying Veris
a toll milling fee of $148.50/st, including
trucking, that will be adjusted on a quarterly basis to reflect any changes to input
costs associated with processing the ore.
The Klondex agreement includes an additional up-front pre-payment, to be deducted from future toll milling charges, to
assist Veris in refurbishing the wet mill circuit at Jerritt Canyon.
All doré produced from Klondex ore
remains the property of Klondex throughout the process, and, as with the Atna
agreement, Veris will treat the associated
toll milling fee as a credit to Jerritt Canyon
operating costs. Veris expects to begin processing ore from Fire Creek in the third
quarter of 2013.
“This second toll milling agreement
adds to our third-party ore processing revenue stream and provides an excellent
additional source of ore as the Klondex
team ramps up their Fire Creek mining
operations into 2014,” Reichert said.
Veris also reports that it has begun production at its Starvation Canyon underground gold mine on its Jerritt Canyon
property. The mine will ramp up to 600
st/d averaging 0.24 oz/st by the end June.
www.e-mj.com
NEWS - PEOPLE IN THE NEWS
BHP Billiton recently announced its new senior management team. The Group Management Committee (GMC)
will comprise: CEO, Andrew Mackenzie; President,
Copper, Peter Beaven; President, Petroleum and Potash,
Tim Cutt; President, Coal, Dean Dalla Valle; Chief Legal
Counsel, Geoff Healy; President, HSEC, Marketing and
Technology, Mike Henry; CFO, Graham Kerr; President,
Aluminum, Manganese and Nickel, Daniel Malchuk;
Andrew Mackenzie
President, Governance and Group Company Secretary,
Jane McAloon; President, Iron Ore, Jimmy Wilson; and President, People and
Public Affairs, Karen Wood. Mike Yeager will retire from the GMC and the
company on July 1. Cutt will join the GMC as president, petroleum and potash
and will retain responsibility for the potash development option. Alberto
Calderon, previously chief executive, aluminum, nickel and corporate development will leave the GMC but remain as an adviser to the CEO. Marcus
Randolph, previously chief executive ferrous and coal, is currently on sick
leave and is not expected to return to the company until the middle of this calendar year. Wilson will retain his responsibilities for the Iron Ore business;
Beaven’s role as president, copper, will include all of his current responsibilities for the assets under the former Base Metals business; Valle, formerly president, energy coal, will assume responsibility for the whole of BHP Billiton’s
coal assets with the consolidation of the metallurgical and energy coal businesses; Malchuk, formerly president, minerals exploration, will assume
responsibility for the assets that form part of the aluminum, manganese and
nickel businesses; Cutt, currently president, diamonds and specialty products
will re-join the petroleum business as president following Yeager’s retirement.
Geoff Healy will join the GMC as chief legal counsel and Jane McAloon will
join the GMC as president, governance and will retain her responsibilities as
group company secretary. Tom Schutte, currently president, manganese and
Glenn Kellow, currently president, aluminum and nickel will work with
Malchuk on the consolidation of these businesses. Hubie van Dalsen currently president, metallurgical coal will retire from the company.
Damian D’Aguiar
Serge Clement
Damian D’Aguiar has been
appointed director, safety, health
and environment of AECOM’s North
American minerals and metals
business. AECOM also announced
that Serge Clement has been
appointed director, sustaining capital services, Northern Ontario.
New Millennium Iron Corp. has appointed Gino Lévesque senior vice president of Tata Steel Minerals Canada Ltd.
Allied Nevada Gold Corp. announced Bob Buchan, the company’s current
executive chairman, will assume the additional positions of president and
CEO, replacing Scott Caldwell as president and CEO.
Jonathan Price, former director of the Nevada Bureau of
Mines and Geology at the University of Nevada, Reno and
state geologist emeritus, recently received a Gold Medal
from the Mining and Metallurgical Society of America
(MMSA). The highest honor awarded by the society, the
Gold Medal is presented to individuals who have made
significant contributions to the mineral industry. Price
retired from his position in the University of Nevada,
Jonathan Price
Reno’s College of Science in July and is now an independent mining consultant. He earned his bachelor’s degree in geology and German
at Lehigh University and worked at the Mineralogisch-Petrographisches institute at the University of Heidelberg in Germany before getting his master’s and
doctorate degrees in geology at the University of California, Berkeley.
Cleveland Mining Co. Ltd. has appointed Rod Campbell an adviser to assist
with the company’s acquisitions program.
Lonmin Plc has appointed Ben Magara CEO and a director.
Teck Resources Ltd. has appointed Dr. Mark Edwards
vice president of community and government relations.
Codelco recently approved a new management scheme
for its divisions following the resignation of Francisco
Carvajal general manager of Radomiro Tomic last
March. Juan Medel, currently general manager of the
Ben Magara
Ministro Hales Division, has been appointed to the same
post at the Radomiro Tomic Division; Claudio Olguin, currently general manager of the Gabriela Mistral Division, has been appointed general manager
of Ministro Hales; and Oscar Jimenez Medina has been appointed general
manager of the Gabriela Mistral Division.
The Mosaic Company has promoted Karen Swager to
vice president of phosphate mining operations.
Zinco do Brasil Inc. has appointed Fernando Croccoa
geologist.
PMI Gold Corp. has appointed James Askew chairman
and non-executive director. Executive Director Thomas
Ennison will not be seeking re-election at the 2013
Karen Swager
annual general meeting, but will continue as the company’s Ghanaian legal counsel.
Lucara Diamond Corp. has appointed Paul Day COO.
Tonogold Resources, Inc. has appointed Mark Ashley CEO.
Goldrock Mines
Corp. has appointed Michael Hoffman, Dean Mussatti and David
Guerrero to its
recently established a Technical
Michael Hoffman
Dean Mussatti
David Guerrero
Advisory Committee that will assist in advancing the development of its 100% owned Lindero
heap leach gold project, located in northwestern Argentina. The company also
announced that Bassam Moubarak has been appointed CFO.
DeZURIK, Inc. has appointed Bryan Burns president and COO.
12 E&MJ • MAY 2013
Corolla (Cori) Hoag
Mark Baker
William H. Dresher
Robert Metz
The Mining Foundation of the Southwest educates the public on the importance of mineral resources in everyday life. The officers for 2013 were elected at the foundations recent Annual Meeting. Corolla (Cori) Hoag has been
elected president; Mark Baker has been elected vice president and Hall of
Fame chair; William H. Dresher has been elected treasurer; and Robert Metz
has been elected secretary.
Jackson Kelly PLLC recently expanded its legal services capabilities with the
hiring of attorneys Robert D. Comer, Michael T. Jewell, Susan V. Anderson
and Steven M. Nagy.
The Nickel Institute has appointed Nigel Ward director of promotion and
market development.
TRIO Engineered Products, Inc. has appointed Alberto Lopez regional sales
manager for Mexico.
The Wits School of Mining Engineering announced that
late Professor Danie Krige recently passed away. His work
was recognized by such varied sources as Moscow State
Mining University, which awarded him an honorary doctorate, and the United States National Academy of
Engineering, where he was the first South African ever to
be elected a Foreign Associate in Earth Resources
Engineering. As recently as last year, he received the
Danie Krige
Order of the Baobab (Silver) from the South African
President, for exceptional and distinguished contributions in business and the
economy, science, medicine and technological innovation and community service. In a seminal 1951 paper published in the Journal of the Chemical,
Metallurgical and Mining Society of South Africa, he pursued a statistical
explanation of the conditional biases in ore block valuations—the basis for the
practice of kriging. He retired from the private sector in 1981, taking up the
post of Professor of Mineral Economics at the School of Mining Engineering at
Wits University until 1991. His research continued unabated—especially into
practical applications of geostatistics in ore evaluation—leading to his publication of some 90 technical papers world-wide over the course of his career.
www.e-mj.com
REGIONAL NEWS - LATIN AMERICA
Barrick Suspends Construction
on Chilean Side of Pascua-Lama
Barrick has ceased construction work on facilities located on the Chilean side of its Pascua-Lama project, shown
here, pending resolution of environmental and other regulatory issues with the Chilean government. (Photo courtesy of Barrick Gold)
Barrick Gold announced on April 10, 2013,
that construction work on the Chilean side
of its cross-border Chile/Argentina PascuaLama gold-silver project had been suspended while the company worked to address
environmental and other regulatory requirements to the satisfaction of Chilean authorities. In the interim, activities deemed necessary for environmental protection were
continuing as authorized.
Construction activities were not affected
in Argentina, where the majority of PascuaLama’s critical infrastructure is located,
including the processing plant and tailings
storage facility. Barrick said it was too early
to assess the impact, if any, on the project’s
overall capital budget and schedule.
Prior to the announcement, Barrick
was targeting first gold production from
the Pascua-Lama project in the second
half of 2014.
Suspension of construction on the
Chilean side of the project was based on a
court order calling for the suspension. The
court was responding to claims of indigenous
communities and environmental groups that
the project was causing environmental damage to glaciers and water supplies.
News reports from a number of sources,
including Reuters, suggested the suspension could last for several months, and possibly up to a year.
In its year-end 2012 Pascua-Lama
project update, dated February 14, 2013,
14 E&MJ • MAY 2013
Barrick noted that the project is based on
resource of nearly 18 million oz of proven
and probable gold reserves, with 676 million oz of silver contained within the gold
reserves. Mine life is estimated at 25
years. The project is expected to produce
an average of 800,000 to 850,000 oz/y of
gold and 35 million oz/y of silver during its
first five full years of operation at all-in sustaining cash costs of $50 to $200/oz of
gold and total cash costs of $0 to negative
$150/oz, including by-product credits.
Total capital cost to develop the
Pascua-Lama project was estimated to be
in the range of $8 billion to $8.5 billion.
As of December 31, 2012, approximately $4.2 billion had been spent on
Pascua-Lama project development, and
construction was approximately 40% complete. The 4-km-long tunnel that will convey ore from Chile to Argentina was approximately 70% complete. In Argentina, construction of the processing plant was
advancing, with 60% of structural steel
erected; and in Chile, construction of the
primary crusher began in January 2013.
Project Development
Resumes at Antucoya
Antofagasta plc announced on March 27,
2013, that Minera Antucoya, owned 70%
by Antofagasta and 30% by Marubeni, will
resume development of its Antucoya copper
project in Chile’s Antofagasta region. The
decision followed completion of a full review
of the project announced in December
2012, when project development was temporarily suspended. The review included
renegotiation of principal construction contracts, additional detailed engineering, and
an updated resource model following further
drilling of the deposit.
Development costs for the Antucoya
project now are expected to total $1.9 billion, of which $0.5 billion had been spent
when development was suspended in
December. Operations are expected to
begin during 2015, with production forecast to average 85,000 mt/y of copper
cathodes over the first 10 years of the
mine’s life.
Centaurus Secures License
for Jambreiro Project
Centaurus Metals, an Australian company
headquartered in West Perth, Australia,
secured the installation license for its
Jambreiro iron ore project in Minas Gerais
state, Brazil, in early April 2013, clearing
the way for on-site construction to proceed.
The license includes all water permits and
vegetation clearing authorizations required
for project development. The license allows
Centaurus to operate at a production rate
of 3 million mt/y of final iron ore concentrate product; however, current plans are to
produce 2 million mt/y at startup.
Total measured, indicated, and inferred
resources at Jambreiro currently stand at
116.5 million mt grading 26.8% iron,
including both near-surface friable mineralization (67 million mt) and underlying compact mineralization (49.5 million mt).
Based on the friable component of the
resource base, Centaurus has established a
proven and probable ore reserve for the project of 49 million mt grading 28.2% iron.
Initial mine life is planned at 8.5 years
at a strip ratio of 0.94:1. A 66%-iron concentrate will be produced by a wet magnetic separation process. Pre-production
capital cost is estimated at A$132 million.
Centaurus will market Jambreiro concentrate production to Brazilian steel mills.
The project is located approximately 130
km from the steel-making region of
Ipatinga, where Usiminas has a 4.5-million-mt/y steel mill.
www.e-mj.com
REGIONAL NEWS - AUSTRALIA/OCEANIA
Newcrest Ramping-up Two
Major Projects
Newcrest says its Lihir mine's Million Ounce Plant Upgrade (MOPU) is now operational and meeting or exceeding
expectations. (Photo courtesy of Newcrest Mining)
Newcrest Mining reported in late March
2013 that production ramp-ups of both its
Cadia East panel cave mine in New South
Wales and its Lihir Million Ounce Plant
Upgrade (MOPU) on Niolam island, New
Ireland province, Papua New Guinea were
progressing in line with expectations.
The Cadia East panel cave mine began
commercial production on January 1,
2013, and ongoing drawbell development
was ahead of schedule. As of the date of
the announcement, 58 drawbells had been
fired, and a further 24 had been drilled
and were ready to fire, which was ahead of
the 75 drawbells planned to be opened by
the end of June 2013.
The primary underground crusher for
panel cave 1 at Cadia East had operated at
rates exceeding 1,000 mt/hr and had been
handed over to operations in March,
enabling increased material movement
from Cadia East and higher-grade feed to
the Cadia plant. Development of panel
cave 2 continued according to plan, with
the excavation of transfer stations and
development of extraction drives currently
the major activities.
Newcrest’s board of directors approved
development of the Cadia East panel cave
mine in April 2010 as the next major ore
source for its Cadia Valley operations. The
construction schedule included under16 E&MJ • MAY 2013
ground mine development, modifications to
the existing processing plant to increase
capacity from 24 million mt/y to 26 million
mt/y, and further development of bulk underground mining technologies, including the
application of automated remote loaders.
The Cadia East orebody is one of the
world’s largest gold deposits, with an ore
reserve at the start of construction of 961
million mt grading 0.61 g/mt gold and
0.33% copper and containing 18.7 million
oz of gold and 3.16 million mt of copper.
Indicated and inferred resources total 2.3
billion mt grading 0.44 oz/mt gold and
0.28% copper for 33 million oz of gold and
6.59 million mt of copper.
The panel cave mine is expected to
underpin Newcrest’s Cadia Valley production
for at least the next 30 years. The provisional mine schedule calls for production of
about 4 million mt/y by year three of operations and buildup to a design production rate
of 27 million mt/y in year nine of operations.
In Newcrest’s financial year ending
June 30, 2012, its Cadia Valley operations
produced 473,195 oz of gold and 44,778
mt of copper. The company has a mediumterm objective of increasing Cadia Valley
production to 800,000 oz/y of gold and
90,000 mt/y of copper.
At Lihir, the new MOPU plant was
handed over to operations in February. All
aspects of the planned ramp-up were
meeting or exceeding expectations.
In Newcrest’s financial year ending June
30, 2012, Lihir produced 604,336 oz of
gold. With the MOPU in production, Newcrest
has a medium-term objective of increasing
Lihir production to 1.2 million oz/y.
The MOPU project was a complex,
multi-system expansion of the existing
Lihir processing facility. The major components of the new system (a 450-mt/hr
autoclave and a 70-mt/hr oxygen plant)
have performed well and operated at full
design capability. All other major systems,
including crushing, conveying and grinding
circuits, were also in full operation.
The gold deposit at Lihir is located
within the Luise Caldera, an extinct volcanic crater that is geothermally active,
and is one of the largest known gold
deposits in the world. Most of the ore is
refractory and is treated using pressure oxidation before the gold is recovered by a
conventional leach process, followed by
production of gold doré.
Newcrest also reported that one of the
four autoclaves in the existing Lihir plant
would be shut down for five to seven weeks
to repair damaged internal brickwork. The
other three autoclaves and the rest of the
processing plant were continuing to operate to capacity.
Koniambo Produces First
Nickel Metal
Xstrata Nickel’s Koniambo laterite nickel
project in the North Province of New
Caledonia tapped its first nickel metal
in early April 2013. The start of production marked a key milestone for the complex, $5-billion greenfield project, which
has been under construction for the past
six years.
Xstrata Nickel holds a 49% interest in
the Koniambo project. Société Minière du
Sud Pacifique, the development arm of the
North Province of New Caledonia, is its
51% joint venture partner.
Ian Pearce, chief executive of Xstrata
Nickel, said, “All components of the mining and smelting process have now been
successfully tested, leading to production
(Continued on p. 26)
www.e-mj.com
REGIONAL NEWS - AFRICA
Ivanplats Secures Power Boost
for Kamoa Project
Ivanplats has signed a memorandum of
understanding with the Democratic
Republic of Congo’s state-owned power
company, La Société Nationale d’Electricité
(SNEL), to upgrade a third hydroelectric
power plant, Nzilo 1, to secure an additional supply of sustainable electricity for
Ivanplats’ underground Kamoa copper project in Katanga province. The proposed
Nzilo 1 upgrade is in addition to planned
upgrades by Ivanplats of the Mwadingusha
and Koni hydroelectric plants. The three
plants could produce a combined 200 MW
of long-term, clean electricity for the grid,
which would be more than sufficient to
launch production at Kamoa.
The Nzilo 1 plant is on the Lualaba River
approximately 40 km from the Kamoa project. The plant was commissioned in 1952
to supply power to nearby copper mines in
the Kolwezi region, but now it is only partly
operational due to the age of the installed
generating equipment. Ivanplats and SNEL
plan to conduct a feasibility study to assess
the scope of work and cost of restoring Nzilo
1 to its design capacity of 111 MW.
Ivanplats is currently working on an
update to the Kamoa preliminary economic
assessment (PEA) released in September
2012. The PEA was for the construction and
operation of a long-term underground mine,
concentrator, smelter and associated infrastructure. Initial capital cost to develop the
project was estimated at approximately $2
billion. The mining rate and concentrator
feed capacity were established at 5 million
mt/y, producing an average of 143,000 mt/y
of payable copper during the first 10 years
of operation at an estimated cash cost, net
of by-product credits, of 95 cents/lb. The
production scenario scheduled 299 million
mt of material over 61 years, producing 7.8
million mt of blister copper.
Ivanplats intends to issue the updated PEA around the end of second quarter of 2013.
The Kamoa project is located approximately 25 km west of the town of Kolwezi
and about 270 km west of Katanga’s
provincial capital of Lubumbashi. The project contains indicated mineral resources
of 739 million mt grading 2.67% copper,
containing 43.5 billion lb of copper, and
inferred mineral resources of 227 million
mt grading 1.96% copper, containing 9.8
billion lb of copper. Both estimates use a
1% copper cut-off grade and a minimum
vertical mining thickness of 3 m.
GWMG Reports Positive
PEA for Steenkampskraal
Great Western Minerals Group (GWMG) has
reported positive results from a preliminary
economic assessment (PEA) of its Steenkampskraal rare earth element (REE) project in Western Cape province, South Africa.
The project includes an underground mine
and future reprocessing of tailings, a rare
earth chloride plant that produces mixed
rare earth chloride, and a solvent extraction
separation plant that produces separated
rare earth oxides (REOs). Thereafter,
GWMG’s business model includes installation of metal-making capacity and expansion of current alloy production capacity at
Less Common Metals Ltd., a GWMG subsidiary in the United Kingdom.
GWMG is a Canadian company headquartered in Saskatoon, Saskatchewan,
and is listed on the TSX Venture Exchange.
Drilling at Ivanplats Ltd.’s Kamoa copper project in Katanga province, Democratic Republic of Congo. Kamoa is
planned as an underground mine, concentrator and smelter. (Photo courtesy of Ivanplats)
18 E&MJ • MAY 2013
www.e-mj.com
REGIONAL NEWS - ASIA
Kaloti Building New Gold and
Precious Metals Refinery in Dubai
Kaloti Jewellery Group, one of the world’s
largest gold and precious metals refiners
and trading houses, has begun construction
of one of world’s largest gold and precious
metal refineries in the Jumeirah Lakes
Towers Free Zone, Dubai. The refinery is
expected to be completed in late 2014.
The new refinery will cost $60 million;
will cover an area of about 15,000 m2; will
have capacity to produce up to 1,400 mt/y
of gold and 600 mt/y of silver and other precious metals; and will include a mint department to produce gold ingots and coins.
The new plant will triple the size of
Kaloti’s current refinery capacity and will
employ the latest gold electrolysis technology from Italy and Switzerland, as well as the
aqua regia process for gold refining. It will
have two assaying laboratories for fire and
ICP (inductively coupled plasma) assaying.
Kaloti Group Chairman Munir Kaloti
said, “This represents a major investment in
expanding and upgrading our refining facilities. This will be a state-of-the-art refinery to
rival the best in the world.”
China Gold International is headquartered in Vancouver, British Columbia, and
is listed on the Toronto and Hong Kong
stock exchanges. State-owned China
National Gold Group, China’s largest gold
producer, is its largest shareholder, with an
approximate interest of 39%. About 40%
of the shares are publicly held.
The Jiama mine is a surface coppermolybdenum-gold-silver-lead-zinc mine
with current processing capacity of about
6,000 mt/d. Commercial production began in September 2010. A prefeasibility
study completed in October 2012 proposes an expansion to 40,000 mt/d, with ore
drawn from both surface and underground
mining operations.
Landslide Buries Workers’
Camp in Tibet
Early in the morning of March 29, 2013, a
major landslide engulfed a worker’s camp of
China Gold International’s Jiama copper-gold
mine 68 km northeast of Lhasa, Tibet. A total
of 83 workers were buried under the rubble,
and 66 bodies were recovered within a week
of the disaster. No survivors were found. The
mineworkers buried in the landslide were
employed by four external independent contractors engaged by Tibet Huatailong Mining
Development Ltd., a wholly-owned subsidiary of China Gold International.
The workers were housed in tents in a
camp located about 10 km from the Jiama
mine site. The slide originated at the top of
a valley above the camp. The crown of the
slide was 5,359 m above sea level, and the
toe was at 4,535 m, a drop of 824 m.
Investigators attributed the slide to complicated local geological structures and meltwater seepage that weakened the geotechnical competence of the mountain side.
The mine site was not impacted by the
slide, and there was no evidence that mining operations had directly contributed to
the initiation of the slide.
20 E&MJ • MAY 2013
billion. The mining companies affected by
the law are PT Vale Indonesia, a subsidiary
of Brazilian iron ore giant Vale; PT Freeport
Indonesia, a unit of Freeport McMoRan;
and Newmont Nusa Tenggara.
Regarding the rule itself, however,
Jakarta remains steadfast. “One thing is for
sure, contract holders must build their
smelters soon,” said Hidayat. “They have
to follow our rules and regulations—no
exception.”
Indonesia is enjoying one of the world’s
biggest mining-driven economic booms, in
no small part from massive industrial
growth on mainland China, the largest consumer of its thermal coal and other metals.
Indonesian government officials now say
they want a bigger slice of the profits.
But Jakarta’s 2009 mining law, and its
lack of clarity, has led to confusion and disappointment among mining companies
that have already invested billions, while
scaring off many others. In April, Indonesia
was ranked the world’s least attractive
place for mining by the Fraser Institute, a
Canadian think tank.
Frontier Mining to Expand
Benkala SX-EW Plant
Indonesia May Ease Smelter
Requirements for Major
Producers
In another twist to the controversy surrounding Indonesia’s ban on raw mineral
exports, officials are allowing major miners
extensions to build their own smelters—or
sign pacts with smelters already under construction—before the 2014 regulation
takes effect.
Acknowledging the strong objections
the law has received from foreign investors
and Indonesians alike, Mining Minister
Mohamad S. Hidayat said, “We can give
them extra time, and if at the end of 2014
the smelters are not ready, we can talk
about them later.”
Most foreign miners say next year is far
too soon to develop smelters in ASEAN’s
largest economy. Indonesian mining industry groups also object to the measure, citing potential annual export losses at $10
Officials at Frontier Mining Ltd., a private
copper producer in Kazakhstan, announced
further $17.9 million in financing from
Sberbank Kazakhstan, allowing for expansion at its Benkala solvent extraction/electro-winning (SX-EW) plant. A further $6
million in capital expenditures will bring
capacity to 10,000 metric tons per year.
In 2013, work will bring Benkala’s
exploration activities to Baitemir, a possible copper gold porphyry deposit with associated molybdenum in the northeast of
Kazakhstan, a former Soviet Republic.
Frontier has a 100% stake in Baitemir via
its 100%-owned subsidiary FML.
Frontier Mining is a copper company
with production, development and exploration operations in Kazakhstan and primary
activity at Benkala, an open-pit mine and
SX-EW production facility in the Urals copper gold ore belt in northwest Kazakhstan.
With a technical office in Almaty, the former
Kazakh capital city, it also maintains offices
in Aktyubinsk and Semipalatinsk, near
Benkala and Baitemir operations.
www.e-mj.com
REGIONAL NEWS - EXPLORATION ROUNDUP
Pilot Gold Launches Drill Program
in Turkey
Pilot Gold has initiated a 30,000-m drilling
campaign at the TV Tower property on the
Biga peninsula in northwestern Turkey. The
campaign includes 15,000 m of drilling on
the property’s KCD target and 7,500 m
each on the Kayali and Columbaz targets.
Three diamond core drills are now in operation, and an additional reverse circulation
drill may be activated later in the season.
TV Tower is a joint venture between Pilot
Gold (40%) and Teck Madencilik Sanayi
Ticaret A.S. (60%), a Turkish subsidiary of
Teck Resources. Pilot Gold is the project
operator and can increase its interest in the
project to 60% through sole funding of
exploration over a three-year period.
TV Tower drilling in 2012 and early
2013 focused entirely on testing the highgrade KCD target. Drilling confirmed the
presence of a 250-m by 400-m gold zone
that remains open down-dip to the north
and established the presence of a 400-m
by 600-m stratabound silver zone that
overlies the gold zone and is open to the
west and northwest.
The 2013 KCD drill program includes
down-dip holes on the gold zone within the
footprint of previously drilled mineralization
and aggressive step-out drilling to the north
and west, primarily on the silver zone. A
permit application has been submitted to
allow for drill access to areas up to 1.5 km
west of the presently defined KCD target,
with plans for intensive drilling over an area
extending up to 500 m to the west.
(www.pilotgold.com)
Exploration Briefs
Alacer Gold has budgeted A$36 million for
exploration during 2013 on tenements in
the areas of its Higginsville and South
Kalgoorlie gold operations in Western
Australia. Alacer produced 136,687 oz of
gold at its Higginsville operations 125 km
south of Kalgoorlie during 2012. Exploration in the region during 2013 is budgeted
at A$16 million and is targeting discoveries that will extend the currently planned
gold production of more than 150,000 oz/y
beyond 2016. Work during 2013 is focusing on targets generated by Alacer’s
Higginsville 2012 exploration, which
included an extensive anomaly generation
program across the Higginsville tenure.
22 E&MJ • MAY 2013
Alacer’s South Kalgoorlie operations 15
km south of Kalgoorlie produced 40,406
oz of gold during 2012. Exploration on
these tenements during 2013 is budgeted
at A$20 million. In late 2012, Alacer
began drilling high-potential conceptual
targets identified by an in-depth targeting
exercise based on extensive exploration
data for the tenements. Three key areas
with the highest probability of delivering a
large gold discovery were identified—
Location 48, the Mt. Marion Complex, and
the SBS28 Complex—and these areas are
being targeted by exploration during 2013.
(www.alacergold.com)
New Gold announced in early April that it
increased the measured and indicated gold
resources at it Blackwater gold project 160
km southwest of Prince George, British
Columbia, to 8.6 million oz at a grade of
0.88 g/mt from the previous total of 8 million oz at a grade of 0.85 g/mt reported at
year-end 2012.
The Blackwater mineral resource estimate now draws on data from 1,002 holes
totaling 309,509 m. The updated resource
estimate will be used for the Blackwater
project’s feasibility study.
New Gold will now shift its exploration
focus to the broader Blackwater land package, where multiple targets were identified
during 2012 through a systematic surface
sampling program. The company currently
has four drills active on the property. During
the second and third quarters of 2013, it
plans to move the drills to the Capoose
exploration prospect on the property and to
new prospective areas identified within its
greater 1,000 km2 of mineral claims.
(www.newgold.com)
Stornoway Diamond Corp. reported the
results of an independent valuation of
bulk-sample diamonds recovered from the
Renard 65 kimberlite pipe on its Renard
diamond project in north-central Quebec.
The sample was undertaken with a view to
the potential conversion of material currently classified as inferred mineral
resource to indicated mineral resource
and, if warranted, to mineral reserve. The
valuation has confirmed a high-quality diamond population at Renard 65 that
Stornoway anticipates will allow the addition of a substantial quantity of new, openpit resources to the project’s mine plan.
The Renard mine plan currently contemplates mining a 17.9-million-carat
mineral reserve from the Renard 2, 3 and
4 pipes from a combined open-pit and
underground operation at a processing rate
of 6,000 mt/d. The mine plan does not
include any inferred mineral resources.
The addition of new open-pit resources at
Renard 65 is expected to allow an increase
in processing capacity to 7,000 mt/d and
the extension of the project’s reserve life.
Within the larger Renard resource inventory, Renard 65 contains an inferred resource
of 3.7 million carats in 12.9 million mt at an
average grade of 29 carats/100 mt to a
depth of 290 m. Exploration potential for the
pipe is estimated at between 6.8 million and
13.7 million carats in 29.5 million to 41.6
million mt at between 23 and 33 carats/100
mt from 290 m to 775 m in depth.
(www.stornowaydiamonds.com)
Lara Exploration signed a Letter of Intent
with Antofagasta Minerals for an option
and joint-venture agreement on Lara’s
Sami gold-copper project in Ayacucho and
Huancavelica departments in southern
Peru. Under the terms of the letter of
intent, Antofagasta can invest $6 million in
exploration over four years to earn an initial
55% interest in the project, of which the
first-year expenditures of $500,000 would
be a firm commitment.
Thereafter, Antofagasta can elect to
earn an additional 5% interest over two
years by completing a preliminary economic assessment and a further 15%, for a
total of 75%, by completing a feasibility
study within nine years. Antofagasta will be
the project operator, and Lara will provide
continuity and support in community relations and permitting.
The Sami project has approximately
50,000 ha of mineral rights. Lara has completed exploration work that has outlined
20 gold-copper targets associated with
high- and low-sulphidation epithermal and
porphyry style alteration assemblages, with
quartz veining, siliceous bodies, hydrothermal breccias, and oxidized vein stockworks.
(www.laraexploration.com)
www.e-mj.com
NEWS-THIS MONTH IN COAL
Morien Wants to Move Forward with
Donkin Coal Project
progress,” MacDonald said. “Our timetable
is as soon as possible but, unfortunately,
we’re at [Xstrata’s] mercy.”
Most likely, Morien would look to sell
Donkin’s coking coal overseas, probably in
Europe. The steam coal would be marketed domestically, possibly to NB Power, formerly New Brunswick Power, or Nova
Scotia Power.
Once a major coal producer, most mining in Nova Scotia these days is done by
Pioneer Coal, with headquarters in Antigonish, about 30 miles from Cape Breton.
Donkin would change that, in a big way.
D.C. Appellate Court Rules in
Favor of Permit Revocation
Morien Resources, which already controls a 25% interest in the Donkin coal project, is looking to buy the remaining 75% from Xstrata Coal and bring coal mining back to Nova Scotia.
Morien Resources Corp. is determined to
bring big time coal mining back to Nova
Scotia even if it has to do much of the
heavy lifting itself. The company, spun off
from Erdene Resource Development Corp.
late last year, was negotiating this spring to
buy Xstrata Coal Donkin’s 75% ownership
stake in the $500 million Donkin coal project proposed for Cape Breton on the
Canadian province’s northeast coast.
Morien already controls a 25% interest
in Donkin that it acquired from Erdene,
based in Dartmouth, Nova Scotia, just
across a bay from Halifax, the largest city in
Atlantic Canada. Purchasing Xstrata’s share
would give Morien full control over the fate
of Donkin, an underground mine that would
produce about 3.6 million tons of highquality steam and coking coal annually after
it begins commercial operation in 2015.
Xstrata announced plans about a year
ago to sell its portion of Donkin, saying, in
essence, that the project was not large
enough to suit its business strategy. At the
time, Xstrata said it expected to announce
a transaction by the end of 2012. But last
year came and went with no Donkin sale.
Now, more than a quarter of the way
through 2013, Morien, eager to move the
coal mine project along, has decided to
step up and fill any sales void Xstrata may
be encountering.
“Morien continues to stand ready to take
on a more active role with its potential part24 E&MJ • MAY 2013
ners should the Xstrata sale process fail to
proceed in a favorable conclusion,” Morien
CEO John Budreski said in late March.
That “active role” includes negotiations
with Xstrata to buy Donkin, according to
Kenneth MacDonald, vice president of
business strategy and CFO for Erdene and
a Morien executive. “From the beginning,
we have been looking at a strategy to cover
all options, including acting on our own or
acquiring the interest” of Xstrata.
Morien is not going in totally alone,
however. Sources close to the project said
Morien is working with a number of coal
purchasers and financiers to assemble a
group that would actually enter into a sale
agreement with Xstrata. Whether that is
Morien’s first preference is uncertain. But
clearly Morien is getting impatient while
waiting on Xstrata to find a buyer.
After unofficially launching the sale
process in April 2012, Xstrata is believed
to have talked to several potential purchasers. Still, no deal had been reached by
late March. “Somebody could come back
in,” a source said. “Any sale process
always leaves the door open.”
So far, Xstrata’s lingering sale process
has not affected Donkin’s timetable,
MacDonald said. “No, I don’t think anything is insurmountable yet,” he said. “You
can always expedite things later on.”
Morien is anxious to have a final answer
on Donkin. “Right now, it’s a work in
The National Mining Association has condemned a ruling by the U.S. Court of
Appeals for the D.C. Circuit allowing the
U.S. Environmental Protection Agency officials to “clearly and unambiguously”
revoke Clean Water Act 404 (c) permits
after prior issuance by the U.S. Army Corps
of Engineers. The move reversed a lower
court ruling annulling the EPA’s authority
to void the Spruce No. 1 permit held by the
Mingo Logan Coal Co., an Arch Coal subsidiary in West Virginia.
Arch Coal and the NMA expressed
sound disapproval. “As a result, uncertainty now hangs over any project and
companies will no longer have the assurance to encourage investments, grow
our economy and create U.S. jobs,”
NMA President and CEO Hal Quinn said
in a statement.
The court did not determine whether
the EPA’s action in the particular case
was permissible, however, and it has been
remanded to the district court. Mingo
Logan, for its part, may also pursue an
“en banc” review of the latest decision,
or petition for certiorari to the U.S.
Supreme Court on the issue of the EPA’s
Sec. 404 authority.
The NMA represents more than 325
businesses in all aspects of coal and solid
minerals production including metal and
industrial mineral producers, processors,
manufacturers, state associations, engineering firms, financial institutions and
other companies that supply goods and
services to the mining industry.
www.e-mj.com
NEWS-CONTINUED
(Regional News - Australia/Oceania - from p. 16)
of metal from Line 1. The production of
first nickel metal at Koniambo after six
years of complex design and construction
is a huge achievement and a source of
great pride for all of our employees. We are
on track to deliver the full production
rate of 60,000 mt/y by the end of 2014
as scheduled.”
Once construction is complete, the
Koniambo project will include a mine, a
pyrometallurgical nickel smelting plant, a
(Regional News - Africa - from p. 18)
The planned Steenkampskraal mine
and rare earth chloride plant are located
about 350 km north of Cape Town, South
Africa. The project is based on a highgrade, narrow-vein underground mine that
was successfully operated by Anglo
American to recover thorium between
1952 and 1963. The planned mine is estimated to hoist approximately 165 mt/d of
run-of-mine material.
power plant, and other complementary
infrastructure, including a deep-water private port and an 11-km overland conveyor.
Toro Energy has received Australian federal government environmental approval for
its Wiluna uranium project in central
Western Australia. Announced on April 2,
2013, the federal environmental approval
was the last major approval required to
clear the way for the proposed A$269-million Wiluna mine to become Australia’s
sixth uranium producer and the first in
Western Australia.
The Wiluna mine plan calls for surface
mining of two deposits. The conventional
alkaline tank leach processing plant is
designed to process 1.3 million mt/y of ore
and to produce 780 mt/y of U3 O8 concentrate over a 14-year mine life. Head
grade to the plant is estimated at 716
ppm. Cash operating costs are estimated
at $37/lb U3 O8.
The PEA is based 278,000 mt of inferred mineral resources at an average grade
of 15.2% total REOs and 176,000 mt of
indicated mineral resources at an average
grade of 18.2% total REOs, each using a
1% total REOs cut-off grade. The resource
estimates included the historic mine area
and exploration areas to the east and west of
the mine, as well as historic tailings.
Capital costs are estimated at
C$175.55 million, including pre-production and post-production capital costs for
the mine and rare earth chloride plant, capital costs for the separation plant, sustaining capital, and a contingency.
Production is projected to start within
24 months of the completion of required
project financing at a design capacity of
5,000 mt/y of contained REOs. Production
of separated REOs is projected to start
within 12 months of the commencement
of rare earth chloride production at a design capacity of approximately 5,000 mt/y
of separated REOs.
Toro’s Wiluna Uranium Project
Receives Environmental
Approval
NEWS-CALENDAR OF EVENTS
MAY 11–12, 2013: Geominetech 13th Annual Symposium on
New Equipment New Technology Management and Safety,
Bhubaneswar, India. Contact: JK Hota, editor and organizing secretary;
Email: [email protected] or [email protected]; Web:
www.geominetech.webs.com.
MAY 19–22, 2013: Haulage & Loading, Litchfield Park, Arizona, USA.
Contact: Tanna Holzer; Tel: 303-283-0640; Email: [email protected]; Web: www.mining-media.com.
MAY 25–JUNE 1, 2013: ALTA 2013 Nickel-Cobalt-Copper, Uranium & Gold
Conference and Exhibition, Perth, Western Australia. Contact: Alan Taylor,
ALTA Metallurgical Services; Tel: 61 (0)418 126 284; Fax: 61 (0)3 9686 3008;
Email: [email protected]; Web: www.altamet.com.au.
JUNE 11–13, 2013: Longwall USA Exhibition & Conference, Pittsburgh,
Pennsylvania, USA. Contact: Tanna Holzer; Tel: 303-283-0640;
Email: [email protected]; Web: www.mining-media.com.
JUNE 17–21, 2013: Exponor, Antofagasta, Chile. Contact: Antofagasta
Industrial Association; Tel: 55-454300; Web: www.exponor.cl.
JULY 28–AUGUST 2, 2013: Mercury 2013, Edinburgh, Scotland.
Contact: Marcus Pattison; Tel: 44 (0) 1727 858840; Fax: 44 (0) 1727
840310; Email: [email protected]; Web: www.mercury2013.com.
AUGUST 11–15, 2013: 23rd World Mining Congress, Montreal, Canada.
Contact: Canadian Institute of Mining, Metallurgy and Petroleum; Tel:
514-939-2710, ext. 1309; Email: [email protected];
Web: www.cim.org.
AUGUST 20–23, 2013: AIMEX 2013 Asia-Pacific’s International
Mining Exhibition, Sydney, Australia. Contact: Reed Exhibitions
Australia; Tel: 61 2 9211 7544; Email: [email protected];
Web: www.aimex.com.au.
SEPTEMBER 4–6, 2013: China International Mining Expo 2013, Beijing,
China. Contact: Beijing Hiven Exhibition Co. Ltd.; Tel: 86-10-6863 8450;
Email: [email protected]; Web: www.bjminexpo.com.
26 E&MJ • MAY 2013
SEPTEMBER 11–12, 2013: EuroMining 2013, Tampere, Finland.
Contact: Tampere Trade Fairs/Mikael Wänskä; Tel: 358 207 701 230;
Email: [email protected]; Web: www.euromining.fi.
SEPTEMBER 16–20, 2013: Extemin, Lima, Peru. Contact: El Instituto
de Ingenieros de Minas del Perú; Tel: (51 -1) 349 4262, ext 352; Email:
[email protected]; Web: www.iimp.org.pe.
SEPTEMBER 16–20, 2013: XV International Congress for Mine
Surveying, Aachen, Germany. Contact: RWTH Aachen, Institute for
Mine Surveying; Tel: 49 241 80 95687; Fax: 49 241 80 92150; Web:
www.ism-germany-2013.de.
SEPTEMBER 23–26, 2013: Exposibram, Belo Horizonte, Brazil.
Contact: Kallman Worldwide Inc.; Tel: 201-251-2600 ext. 127 or
56 2 843 3300 ext.3303; Web: www.kallman.com.
SEPTEMBER 25–27, 2013: IX Colombia Minera-Feria Internacional
Minera 2013, Medellín, Colombia. Contact: Carmen Henríquez Brugés;
Asociación Nacional de Empresarios de Colombia–ANDI; Tel: 57 4
3265100 ext. 1154; Email: [email protected].
OCTOBER 1–3, 2013: Minex Russia 2013, Moscow, Russia. Contact:
Irina Yukhtina; Tel: 44 (0)207 520 9341; Fax: 44 (0)207 520 9342;
Email: [email protected]; Web: www.minexrussia.com.
OCTOBER 31–NOVEMBER 2, 2013: Mining 2013 Myanmar, Yangon,
Myanmar. Contact: Shaun White, Allworld Exhibitions; Tel: 44 2078402130;
Email: [email protected]; Web: www.miningmyanmar.com.
NOVEMBER 27–29, 2013: IX International Heavy Minerals Conference 2013, Vishakapatanam, Andhra Pradesh, India. Contact:
Mining Engineer’s Association of India; Tel: 08942-283755; Email:
[email protected]; Web: www.meai.org.
AUGUST 2–8, 2014: 10th Mine Ventilation Congress, Sun City, South
Africa. Contact: IMVC 2014 Congress Secretariat; Tel: 27 (0)21 683
2934; Fax: 27 (0)21 683 0816; Email: [email protected]; Web:
www.imvc2014.org.
www.e-mj.com
EMJ_pg28-31_EMJ_pg28-31 5/2/13 11:18 AM Page 28
MINISTRO HALES
Ministro Hales Approaches Production
Codelco will soon commission the next great Chilean copper mine
By Oscar Martinez Bruna, Latin American Editor
The world’s largest copper miner, Corpración Nacional del Cobre (Codelco),
has committed to building another world
class mine: Ministro Hales. The Chilean
state-owned copper company is investing a total of $3.1 billion—its largest
mining investment ever. The project will
extract copper from an orebody that contains more than 1.3 billion metric tons
(mt) of ore with an average grade of
0.96% copper. When División Ministro
Hales is commissioned later this year, it
will yield an average annual production
for the first five years (2014-2018) of
200,000 mt of fine copper and 350 mt
of silver.
Construction on División Ministro
Hales began in September 2010 and
the orebody is still under development.
The ore deposit was formerly known as
Mansa Mina. It is located roughly 5 km
north of Calama in the Antofagasta
region. The project is named for
Alejandro Hales, a former Chilean minister of mines. The investment and
development strategy was based on a
36-month timeframe, followed by a
start-up stage, scheduled to take place
during the third quarter of 2013.
Although the operation begins as a
traditional open-pit development over a
period of 14 years, the business model
applied by División Ministro Hales forecast a mine life of more than 50 years.
And, if developed according to plan,
the mine would also begin underground
mining in year 50. Codelco is one of
only a few mining companies that has
such a long-term vision.
When it comes online, Ministro
Hales will allow Codelco to maintain its
production levels in the medium term.
The mining and mineral processing
techniques will yield a nice return on
investment for Codelco as well as
improving the company’s competitive
position in the copper market.
When E&MJ visited the operation
(February 2013), Paulo Delgado,
Codelco communications specialist,
said the overall progress of the entire
project, both pre-stripping and plant
construction, currently stood at 82%.
“The pre-stripping involves mobilizing
288 million mt of overburden, and
since April 2011, we have completed
76%. Today, the mine is moving around
240,000 mt per day.
“This progress is a result of unified
work between División Ministro Hales
and the project vice presidency of
Codelco, the latter being in charge of
building the plant facilities of the division,” Delgado said.
Community Involvement
The infrastructure at the south end of the
open pit covers an area of approximately
126 hectares. The facilities will provide
truck maintenance services, machine
shop, lubrication pits, equipment washing bays, tire yard and warehouses, as
well as management and engineering
facilities: warehouses, contractor facilities, staff services and light vehicle petrol
station. The design includes a neighborhood development close to the site.
“División Ministro Hales represents
a joint effort of managers, employees
and the neighboring community aimed
to develop a world-class project, with
new management models, the best
practices in the market, state-of-the-art
technology, and respect to life and environment as a first priority,” Delgado
said. “This professional, collaborative
and concentrated work will be done
pursuing the respect for the life and
dignity of everyone involved in the operation, which are considered essential
values set by Codelco.”
División Ministro Hales tried to hire
local manpower to complete every task.
Calama is a copper mining community
of about 150,000. Nearly 60% of
Ministro Hales workforce has been
hired from Calama and the surrounding
A panoramic view of the pit shows a mammoth earth-moving project.
28 E&MJ • MAY 2013
www.e-mj.com
MINISTRO HALES
Electric shovels load haul trucks in what is believed to be Chile’s largest pre-stripping operation.
areas, and around 70% come from the
Antofagasta region. About 12% of the
miners are women.
“The división has stated its strong
commitment of growing together with
the community and making this operation and business a great opportunity
for the social and economic growth and
development of Calama,” Delgado said.
For that purpose, the company has
defined its relationship with the community as a shared, collaborative and communicated work that provides consistency
and sustainability to the Community
Development Plan set by the división.
This plan embraces work streams associated with active participation of the community, education and culture, creation of
new job skills development, wealth generation, profitability and social investment.
is expected to be 50,000 mt/d, with the
output material being fed to a primary
crushing line and a SAG milling line,
selective flotation through the use of
oversized cells, a roasting process, acid
plant and arsenic abatement. The concentrate and/or calcine will be tollsmelted to produce high purity copper
cathodes. It also features an oxide processing line rated at 20,000 mt/d, and
the solutions will be treated by conventional electrowinning in Chuquicamata.
The mining equipment itself will be a
combination of Cat electric shovels and
Komatsu PC8000 hydraulic shovels with
dipper capacity of 100 mt and bucket
capacity of 80 mt, respectively, loading
360-mt-capacity Cat 797F haul trucks,
all utilizing the latest mining technology.
“By the end of the construction
phase there will be six mining shovels
and one supporting shovel (four shovels
are currently operating), and 35 haul
trucks, and we have 19 operating now.
The mine will also employ four blasthole drill rigs, which are expected to
drill 12.25-in. holes. Three of the drills
have been erected. Along with the mining fleet there will be a supporting fleet
of seven bulldozers, four wheel loaders,
three motor graders and three watering
trucks,” said Delgado.
Developing a World-class
Deposit
Ministro Hales will be the largest prestripping operation in the history of
Chilean mining, moving more than 238
million mt of waste rock to construct
the open-pit mine. Pre-stripping commenced in April 2011 and continues
today. The open-pit mine plan calls for
370,000 mt/d of material to be moved
by truck-shovel mining techniques. The
ore will be processed in a stand-alone
concentrator, whose design production
www.e-mj.com
A 58,000-mt stockpile facility will feed a new concentrator.
MAY 2013 • E&MJ 29
MINISTRO HALES
A 5-km-long conveyor moves ore from primary crushing installations to a stockpile facility.
The primary crusher, a 63 x 89-in.
(1,600 x 2,260-mm), 1,341-hp ThyssenKrupp machine, will allow the mine to
crush ore at a rate of 4,400 mt/h. The
haul trucks discharge directly into the
primary crusher and the dump zone area,
which has been engineered as a confined
facility to control dust emissions. The
facility has a fairly sophisticated dust
suppression system.
“It is important to mention that
since Ministro Hales is located near
Calama, it will be necessary to maximize our dust suppression efforts in the
crushing process due to sustainability
aspects such as quality of life, which
must be present in every phase of our
operation,” Delgado said. “We are convinced that we are constructing mining
for the 21st century.”
The heap leaching project for
Ministro Hales includes a waterproof
base static pile where nearly 600,000
mt of ROM ore grading 0.22% total
copper and 0.13% soluble copper will
be contained in three heap modules.
After passing through these ROM
modules some in situ oxide (OIS) will
also be placed in heaps. The grades
identified for this OIS are 0.6% total
copper and 0.3% soluble copper. The
ore will be previously crushed in primary and secondary crushers to obtain
a grain size between 0.75 to 1 in. (19
to 25 mm), and an acid curing should
generate a 65%+ copper recovery.
The life expectancy for this heap is
three years and the mine hopes to
recover around 70,000 mt of fine copper coming from 21 million mt of ore
heaped on four 8-m lifts. The solution
obtained from this process will contain
4 to 5 grams per liter copper concentrations, and they will be transferred to
a solution recovery plant at the neighboring Chuquicamata mine, to further
join the SX-EW process and then obtain
copper cathodes.
Copper concentrate, which contains
arsenic, will be processed at a new
roaster and will produce a calcine with
a low arsenic content and high copper
concentration. It will be processed to
obtain a high-purity cathode in the
smelter and refinery.
Mineral Processing
Ore passing the primary crusher reports
to an 80-m long, 2.8-m wide conveyor,
an ST 1800. It transfers ore to a 3- to 5km-long, 54-in. wide (1,372-mm) wide
overland conveyor, which dumps onto a
58,000-mt stockpile. The capacity for
the entire material handling system is
rated at 50,000 mt/d. To control the
dust emissions, the overland conveyors
feeding the stockpile will be enclosed.
Adding breakthrough technology in
the mining processes and the overall
operation is one of the concepts highlighted by División Ministro Hales in
each one of its areas. This particular
mine applies the latest technology
available in the market for both the
crushing circuit and the overland conveyor, and it is also remarkable in the
control of dust emissions. All of the
truck loading zones are confined and
enclosed, with water nebulizer systems
to abate dust particles.
30 E&MJ • MAY 2013
Today, the miners at Ministro Hales are moving about 240,000 mt/d.
www.e-mj.com
S LO P E M O N I T O R I N G
Careful Monitoring:
The Key to Pit-wall Safety
As mines get deeper, and economic
pressures provide an incentive for
steeper pit walls, the potential for
instability increases. E&MJ looks at some
of the systems that can help mine engineers
keep an eye out for signs that all may not be
well within the wall.
By Simon Walker, European Editor
An SSR radar scanning system installed at one of PT Adaro’s surface coal operations in Indonesia. (Photo courtesy of GroundProbe)
On Friday, April 11, Rio Tinto issued a
press release that read: “At 9:30 p.m.
local time on April 10, 2013, Kennecott
Utah Copper’s Bingham Canyon mine
experienced a slide along a geotechnical
fault line of its northeastern wall.
Movement on the northeastern wall had
accelerated in recent weeks and preemptive measures were taken to relocate
facilities and roads prior to the slide. All
employees are safe and accounted for.”
Speaking a few days later when presenting the company’s first-quarter operational review, CEO Sam Walsh expanded
a little on the effect that this may have
on Rio Tinto’s copper production for the
rest of this year. “At Bingham Canyon,
last week’s pit-wall slide will have a significant impact on our copper production
this year,” he said. “A recovery plan is
being implemented to minimize the economic impact.
“Based on an early assessment of
information currently available, it is esti32 E&MJ • MAY 2013
mated that 2013 refined copper production at Kennecott Utah Copper will be
approximately 100,000 metric tons (mt)
less than previously anticipated,” he
said. To put this into context, during
2012 Bingham Canyon contributed
163,200 mt to the company’s total of
548,800 mt of mined copper, and
162,700 mt of refined copper.
Early estimates suggested that around
150 million mt of material slid into the
pit. The most important outcome of the
incident, of course, was that no one was
injured. The material damage, however,
was significant, with the principal access
ramp out of the pit now unusable in the
area of the slide. In addition, three of the
mine’s 13 shovels were damaged, as
were 14 of its 100-truck haulage fleet
and some ancillary equipment.
Imagine, though, the impact had
there been no monitoring procedures in
place, and the company was unaware of
the increasing instability in this section
of the mine. The consequences could
indeed have been catastrophic.
And, to be fair, today’s sophisticated
monitoring systems are a relatively new
addition to the mine engineer’s toolkit.
Until high-sensitivity radar, surveying and
laser systems became available for this
market sector only a few years ago, pitwall inspection was essentially a visual
exercise, requiring personnel access into
potentially hazardous wall areas to enable
detailed assessment to be carried out.
Radar Systems Provide
Long-range Accuracy
After the slide, Rio Tinto was quick to
issue a fact sheet that explained in some
detail the various systems used at
Bingham Canyon to monitor the walls of
the 1,200-m-deep pit. “Our monitoring
system includes the trained eyes of more
than 800 employees, regular documented inspections of all areas of mining
activity by geotechnical engineers, and
www.e-mj.com
state-of-the-art equipment,” the company noted.
Bingham Canyon uses GroundProbe
and IBIS slope-stability radars, extensometers, robotic theodolites, time-domain
reflectometry and microseismic monitoring, all of which feed data to the mine’s
geotechnical department to help improve
understanding of how the pit walls are
reacting to continuing excavation of ore
and waste rock.
According to Australia-based GroundProbe, the concept of using radar to measure pit-wall movements began as a
University of Queensland research project in 1997. The company launched its
Slope Stability Radar (SSR) system in
2001, and more than 150 units have
since been put to work in 20 countries,
with more than 500 wall failures detected.
Mounted on a four-wheel trailer, an
SSR unit monitors a pit wall from the
opposite side of the mine, scanning the
entire face in repeated cycles. With a
900-mm-diameter dish, the system has
a range of between 30 and 1,400 m,
while using a 1,800-mm dish increases
this to 3,500 m. At this range, the company said, a unit can detect a failure
measuring 30.5 m (100 ft) square, even
in operations where there is high humidity or rainfall.
GroundProbe said its advanced analysis tools allow for long-term trending and
hazard identification, while photographs
of the scan area allow user-friendly identification and interpretation of slope
movements. The system will also recall
previously stored data if a unit has to be
moved temporarily and, most importantly, it will raise an alarm if it detects
accelerated slope movement that can be
a precursor to wall failure.
While SSR is designed to operate as a
broad area monitoring system, continuously collecting data over time and providing high-precision data, sophisticated
trending information and advanced alarm
capabilities, GroundProbe’s Work Area
Monitor (WAM) is used to warn work
crews of wall movement using visual and
audible alerts. Its range and slope coverage make it ideal for applications close to
the wall, the company claims, noting that
the two systems have distinct, but highly
complementary applications and that for
the ultimate solution in slope stability
monitoring, its clients use both.
As well as being able to monitor pit
walls for purely safety reasons, the comwww.e-mj.com
pany pointed out that its systems can
also help producers to optimize their
resource utilization. In one example, it
said that Indonesia’s PT Bayan was able
to recover coal worth perhaps up to
$8 million by monitoring potentially
unstable pit wall and floor areas, relying
on real-time movement data to schedule
its mining sequence.
A division of Reutech Radar Systems,
the South African company that develops
and manufactures ground and naval
radar systems, Reutech Mining services
the open-pit mining industry with its
MSR movement and surveying radar. The
company offers three versions of its system, the MSR 200, 300 and 060.
Reutech has reported on the use of
one of its MSR200 units at Codelco’s
Andina operation in 2008. During the
first 15 days of monitoring a suspect area
of pit wall at a distance of 575 m, very
Using laser scanners and limited visual observation, Rio Tinto’s initial estimate was that some 150 million mt of
material slid into the Bingham Canyon pit on April 10. (Photo courtesy of Rio Tinto)
MAY 2013 • E&MJ 33
Two SSR radar units providing comprehensive coverage of the opposite pit wall. (Photo courtesy of GroundProbe)
little movement was noted. However, a
sudden increase in movement was then
identified, with subsequent acceleration
leading to the final wall slide some 30
minutes later. The ability to use the system to provide a warning of the impending collapse allowed the mine to withdraw personnel and equipment in time.
Last year, E&MJ cited another application of Reutech’s system at Eldorado
Gold’s Kişladağ mine in Turkey (May
2012, pp. 28-32). Localized failures had
occurred along sections of the pit wall, so
the MSR system provides close monitoring, taking between 5 and 10 minutes to
complete a scanning cycle across the
entire opposite wall.
According to Reutech, the MSR provides real-time, all-weather surveying and
slope movement measurements using
state-of-the-art radar and surveying technology. Real-time capabilities are given by
its ability to carry out stability and surveying measurements simultaneously, with
data being exported via high-speed links.
The system uses not only radar but also
an integrated Leica Geosystems total station. Maximum distances for the units are
1,200 m for the MSR200 and 2,500 m
for the 1,200-mm-dish MSR300, with
the company claiming that the MSR 300
is the only slope radar system currently
available that can resolve a 15 m bench
failure at 2,500 m.
Meanwhile, the MSR060 is a modular
version of the equipment that can be fitted into the back of a pickup for greater
maneuverability. In each case, the systems are capable of detecting sub-millimetric movements on the slopes being
monitored, with measurements being
fully geo-referenced to an accuracy that
34 E&MJ • MAY 2013
allows for seamless integration with standard digital terrain mapping tools.
As an alternative to dish-type systems, Italian-domiciled IDS Corp. offers
interferometric mine slope radars. Its
IBIS-FM provides sub-millimetric measurement capabilities at distances of up to
4,000 m, IDS said, with just two-and-ahalf minutes needed to complete a full
resolution scan from 2,000 m. A number
of these units, either fixed or mobile, can
be linked around the perimeter of a pit to
form an FPM360 system—which in turn
can provide complete coverage of all the
pit walls in real time. The company pointed out that each system is customdesigned to meet an operation’s specific
needs, and can be scaled to accommodate future pit expansions.
Speedy Laser Scanning
In the U.K., 3-D Laser Mapping has been
one of the pioneers in the use of Lidar
systems for monitoring open-pit mines.
Development of its SiteMonitor system
was driven by the need for a mapping and
monitoring solution that takes full advantage of the benefits of laser scanning
while remaining easy to use, the company pointed out.
A state-of-the-art laser measurementbased system for monitoring rock faces
and landslips, SiteMonitor was developed
in partnership with mining surveyors to
provide a simple-to-use, reliable and flexible solution. Using non-contact laser hardware, the system makes range measurements on a pre-defined grid on a selected
cycle, with a software suite that incorpo-
A SiteMonitor laser scanning system set up on a pit bench. The system does not need prisms installed on the slope
being monitored. (Photo courtesy of 3-D Laser Mapping)
www.e-mj.com
rates an analysis module for displaying
and analyzing time-series monitoring data.
According to 3-D Laser Mapping, SiteMonitor’s key advantages include the fact
that no prisms have to be placed in the survey area, with the system providing rapid
monitoring of thousands of points rather
than single prism locations. It gives complete coverage of the visible surface, with a
measurement range of up to 6,000 m. It is
also portable, so it can be set up in areas
where access is limited.
Slope stability monitoring is just one
of the tasks now being given to a Riegl VZ
1000 laser scanner that the company
recently supplied to Exxaro Resources for
use at its Grootegeluk coal mine in South
Africa. In addition, the equipment is
being used to survey stockpiles for volume verification, provide height analysis
on earthworks and blasting, and to collect highly accurate measurements for
terrain mapping and modeling.
The mine’s chief surveyor, Thys Smith,
noted that the system “allows us to manage risk, minimizing surveyor contact with
moving equipment and potential falls of
ground. The work we do includes bench
surveying, volume verification, height
analysis, as-built surveys, terrain mapping
and modeling, and ground control and
contouring,” he said.
3-D Laser Mapping describes the
Riegl VZ 1000 as a high-speed laser
scanner with a wide range of view that
utilizes unique echo digitization and
online waveform analysis to achieve
superior performance and accuracies of
measurement, even under adverse weather conditions. Achieving accuracies of
5 mm at ranges of up to 1,400 m, it can
measure up to 122,000 points per second with a 100 × 360° field of view.
Also British-based, Measurement Devices Ltd. (MDL) has been supplying
laser-based, time-of-flight measurement
systems to users in the mining, quarrying
and other industries since 1983. Its
Quarryman Pro mining-industry laser profiling system is now used by most major
surface mining and quarry service companies worldwide, according to the company.
The company recently introduced a
long-range version of the system, the
Quarryman Pro LR, which can measure at
ranges of up to 1,200 m to nonreflective
surfaces and also has a vertical spot size
approximately 10 times smaller than its
predecessor. The increase in range and
smaller spot size allows the operator to
collect more detail at longer ranges, thus
minimizing equipment set-ups and time
on station.
Designed for operation from a standard surveying tripod, the unit weighs
just 8.1 kg (18 lb). It has a 250-pointper-second scan rate in automated mode,
or can be used as a point-and-shoot system in manual mode. Data are recorded
to compact flash cards for later processing using either MDL or other industry
software to give 3-D face profiles that can
be compared over time to identify areas
of potential instability.
Total Stations are
Another Option
Setting up a microseismic monitoring unit at an Australian open pit. (Photo courtesy of ESG Solutions)
36 E&MJ • MAY 2013
Conventional pit-wall monitoring has
relied on visual inspection, often supported by detailed surveying, to generate
a record over time. There is no question
that this approach still has a valuable
role to play, and the development of latest-generation total stations has helped
to maintain its position in this respect.
As an example, Switzerland-based
Leica Geosystems reported that its specialist surveying equipment has been in
use at one of PT Adaro’s coal operations
in Kalimantan, Indonesia, since 2004.
Here, the company said, 11 Leica
Geosystems’ total stations are installed
www.e-mj.com
at the Tutupan mine, with hundreds of
monitoring prisms on the pit slopes providing the means for carrying out slopestability monitoring.
The prisms are installed on the pitwall surfaces at 100–150 m intervals,
with the total stations measuring distances of 800–2,500 m in a nearly continuous cycle. There are also six meteorological sensors within the mine that
automatically measure the atmospheric
conditions. All of the data gathered are
transmitted by radio link to a Leica
GeoMoS control system, with software
used to generate long-term deformation
information. Leica noted that since the
monitoring system has been installed,
the geodetic and geotechnical sensors
controlled by the monitoring software
have been able to detect some slope failures in advance, with other techniques
such as inclinometers, crack-meters and
visual inspections adding to the information resource.
In Poland, meanwhile, a Leica Geosystems’ slope monitoring system has
been in use at the Bełchatów lignite mine
for the past four years. Comprising two
total stations and a global navigational
satellite system (GNSS) reference network to known stable points, and also
controlled by GeoMoS software, the system provides the mine operator with
slope-stability displacement data in a
local coordinate system. One of the total
stations works continuously and is
mounted inside an air-conditioned container, equipped with a hydraulic leveling
system. Both units measure continuously
more than 50 monitoring points located
on the pit walls around them.
Not all stability issues arise in open
pits, of course, and the company has
supplied the Polish copper producer,
KGHM, with a monitoring system for a
section of its huge Zelazny Most tailings
dam near Lubin in the west of the country. Having relied on traditional monitoring techniques for decades, in 2008
KGHM began using a Leica Geosystems
total station and prisms, with data being
sent for processing and interpretation via
LAN and WiFi links. Leica Geosystems
said its monitoring solution, which
includes the SyZeM geological software,
has helped give a major improvement in
generating and analyzing data, with
slope-failure predictions now being done
in real time.
U.S. company Trimble’s 4D Control is
an automated monitoring system used in
real-time slope-stability monitoring. It
processes and stores data from optical,
GNSS, geotechnical sensors and weather
stations, which are then are visualized,
analyzed, alarmed and reported via a
powerful, user-friendly web interface.
Trimble said the heart of the system is
its S8 total station, capable of measuring
up to 2,500 m with a precision of better
than 1 mm in distance and 1 arc second
in bearing. It includes several industryleading technologies that contribute to
meeting the demands of slope stability
monitoring including frictionless MagDrive servo technology for faster measurement and FineLock technology for
flexibility in proximity and density of
prism targets. The network of total stations, reference prisms and monitoring
prisms is augmented with NetR9 GNSS
reference receivers. These receivers may
be used as independent displacement
sensors or may be combined with reference prisms and total stations located in
potentially unstable areas to provide
updated locations during a combined
adjustment process.
The company notes that 4D Control
supports a broad variety of geotechnical
and meteorological sensors. For example,
Trimble REF TEK accelerometers can be
used to monitor the magnitude of blast
shock waves on high walls and surrounding infrastructure, since their effects can
result in vibrational stress fracturing of
the rock mass, ultimately leading to rockfalls or more complex failures.
Data from all instruments and sensors are processed by the server component of the software, and are stored in a
unified monitoring database for subsequent visualization or complex comparative analysis. Velocity and inverse velocity facilities are available for highwall
stability monitoring, addressing the
challenges of both slow and accelerated
movements, which are one of the indicators of a potential failure.
Alarms may be configured on data
from any combination of GNSS, optical,
geotechnical or weather sensors. Various
levels of alarm can be set and the current
status of the system can be viewed on the
web interface in real time.
Trimble states that the combination of
GNSS sensors, prisms and the angular
accuracy of the total station are suitable
for the detection of both toppling and
slumping failures on a highwall. Suitable
placement of prisms across a suspected
fault line, combined with a dedicated computational feature on the 4D Control software, enables the prisms to simulate a wire
extensometer, so differential movement
between adjacent rock masses can be
monitored with a high level of accuracy.
Trimble offers several technologies to
provide terrain mapping and volumetric
measurements, including unmanned aerial systems and spatial imaging systems,
that can be used in slope failure analysis.
Its Gatewing X100 is an unmanned aerial
system used for fast and accurate mapping and analysis of hard-to-reach and
hazardous areas, while the VX spatial station integrates optical surveying, metric
imaging and 3-D-scanning technologies
for precise measurement at ranges up to
5,500 m in long-range mode.
With an Ear to the Ground
Monitoring a slope failure at Anglo Platinum’s Mogalakwena mine in South Africa using a Gatewing X100 UAV.
(Photo courtesy of Gatewing)
38 E&MJ • MAY 2013
Microseismic monitoring is used in openpit mines to monitor the rockmass
behind pit walls in order to detect behavior that may cause slope instability at the
www.e-mj.com
Trimble S8 Total Station observes a network of prisms or suitable reflective surface targets as part of the Trimble
4D Control system. (Photo courtesy of Ian du Toit and Optron Pty Ltd.)
surface. As the Canadian equipment supplier ESG Solutions pointed out, seismicity behind a pit wall may be caused by a
number of factors, but in all cases knowledge of the location of microseismic
events can help operators plan mine
development and mitigate risk.
The primary applications for microseismic slope monitoring include the evaluation of fractures generated during mining
applications, activation of known or
unknown geological structures in the rock
mass, stress changes behind the slopes
and evaluation of vibration thresholds of
the slope structure. A microseismic system
determines the location and magnitude of
seismicity in real time, potentially acting
as an early-warning system by detecting
abnormal seismic activity weeks before
displacements are observed at the surface.
The company explained that as in-situ
stresses change in the rock mass during
open-pit operations, rock failure in the
form of cracks or fractures is common.
Some fractures may propagate to the pit
walls, while the removal of large volumes
of rock during mining may release or
reduce in-situ stresses, enabling movement along natural faults or joints.
Sensitive monitoring equipment is
deployed in an array around the zone of
40 E&MJ • MAY 2013
interest to “listen” to the sounds of rock
as it cracks and fractures. Seismic energy released in the form of waves can be
detected by the sensor array. The origin
or source of the “event” can then be
located and mapped in 4-D (x, y, z +
time). Sensor arrays consisting of uniaxial and triaxial 15 Hz geophones are
designed to provide good coverage of the
monitoring zone, with most open-pit
monitoring systems relying on sensors
deployed from the surface.
Seismic signals picked up by the
array are transmitted to Paladin acquisition units, then on for processing using
ESG’s Hyperion Seismic Software (HSS)
suite to determine the size of each event
as well as its location in 3-D. The software is used to visualize results with
respect to the slope geometry for a
greater understanding of rock-mass
behavior behind the slope wall, with data
from inclinometers and other instruments also being used to detect variations in tilt or surface deformation consistent with slope instability.
ESG said one application for its
equipment involved a 36-channel microseismic array consisting of nine triaxial
and nine uniaxial 15 Hz omni-directional
geophones to investigate slope instability
in a large open-pit mine in South
America. Over a four-month period, close
to 1,000 microseismic events were detected to a positional accuracy of 28 m.
Evaluation of this seismicity revealed
that mining operations had activated
local geological structures, with the
majority of the seismicity occurring along
two trends behind and parallel to the
eastern wall of the pit. The mine operator
was able to integrate this knowledge into
its planning activities to help mitigate
the risk of subsequent instability.
Aerial Imaging:
The UAVs Arrive
As noted in the article on digital solutions for mine mapping in the January
Trimble 4D Control chart shows prism displacement over one month on unstable slope. (Image courtesy of Ian du
Toit and Optron Pty Ltd.)
www.e-mj.com
edition of E&MJ (pp. 40-43), mining
companies are increasingly making use
of unmanned aerial vehicles (UAVs)—or
microdrones—to undertake photographic
surveying that can then form the basis for
highly detailed topographical imagery.
The article cited the Gateway X100 UAV
from Trimble, although this is just one of
many competitive models now available.
The major benefits of this type of equipment is that they are light-weight, simple
to use, and can be programmed to fly a
specific path, at a stipulated elevation,
over areas that would take days to survey
or photograph manually.
Thus far, UAV use has typically been
restricted to tasks such as mine, stockpile or waste dump overviews, rather than
carrying out the high-precision surveys
needed to monitor pit walls. However, as
the CEO of the Swiss software company
Pix4D, Dr. Christoph Strecha, noted,
there is no technical reason why this
should remain the case. “We can already
do oblique 3-D-modeling up to a very
high resolution,” he said.
Dr. Strecha explained that the accuracy achieved depends largely on the
elevation at which the UAV flies above
the surface being scanned. “For a UAV
flying at 50 m, he said, each image pixel
represents about 20 mm. Fly nearer the
surface, and you can reduce this to
about 5 mm. The closer the UAV is to
the surface, the more images are taken
to cover a specific area, the longer it
takes and the better the accuracy—so
it’s a trade-off between the time taken to
do the survey and the number of
images,” he said.
“The technology for processing image
data like this has only been around for
less than 10 years, but already some of
the major mining companies are keen to
make use of it to carry out regular inspections on site while the UAV is controlled remotely from the survey office—
which could be somewhere else completely. What it can’t do yet is provide
real-time data; for that you still need to
have radar or some other similar system,” Dr. Strecha said.
As Andrew Blogg of the British company, Digital Mapping & Survey, pointed
out, stability monitoring is indeed possible using UAVs. The company is currently working on an iron ore development
project in West Africa where, he said, the
operating company is actively evaluating
their use to monitor steep, inaccessible
www.e-mj.com
spoil piles formed during the construction of railway lines.
The bottom line is that pit-wall failures
can be very costly indeed in terms of lost
production, equipment and infrastructure
damage, and in the potential risk to personal safety. Monitoring technology has
come a long way in a relatively short time,
with mining companies realizing real benefits from using combinations of systems to
get a better understanding of what is really
happening out of sight, behind the pit wall.
The Bingham Canyon slide has demonstrated just how effective monitoring has
become, and perhaps one comment on
the operation’s Facebook page summed
up its success on a personal level. “You
guys did a great job,” said Jennifer Loder
Heaps. “My husband was working last
night. Thanks for getting him home safe!”
MAY 2013 • E&MJ 41
EMJ_pg42-47, 70-71_EMJ_pg42-47, 70-71 5/3/13 1:15 PM Page 42
W AT E R M A N A G E M E N T
Mine Water Management: No Simple Recipe
Mining must become more adept at finding
acceptable water-source solutions in an
increasingly complex, thirsty world
By
By Russell
Russell A.
A. Carter,
Carter, Managing
Managing Editor
Editor
Water and gasoline generally don’t get
along well together, but these two commodities have more in common than many
people realize. When used in large volume,
both must be managed carefully to control
costs and ensure adequate supply. In the
future, demand for both is expected to
grow dramatically, driven by expanding
population levels and lifestyle expectations
from new middle-class consumers in rapidly developing countries. Consequently,
both are also expected to become more
expensive, inflated by heightened demand
and limited supply. And, both have incendiary properties that can be useful or
destructive: Gasoline is volatile, yet necessary to power much of the world’s vehicular motion; while water—or more often,
lack of it—has the ability to inflame civil
unrest that can halt an industrial or mining
project in its tracks.
Although the gasoline/water analogy
falters a bit when applied to mining—
which mostly runs on diesel fuel—experts
predict that water issues will generate a lot
of heat for the global mining industry in
the coming years.
Perhaps the most vivid recent example
of water’s ability to incinerate carefully laid
42 E&MJ • MAY 2013
plans is the controversy surrounding the
$4.8-billion Conga gold/copper project in
Peru, a property held by Minera Yanacocha
S.R.L., in which Newmont Mining owns a
51.35% interest. Conga is an important
element for Newmont, which concedes
that failure of the open-pit mining project
to advance to production could have an
adverse effect on its future growth if it were
unable to replace Conga’s anticipated output, which is in the range of 600,000–
700,000 oz/y of gold and 160,000–
240,000 lb/y of copper.
But Conga, located 24 km away from
the joint venture (Newmont/Buenaventura)
Yanacocha gold mine, has been the target
of local political and community ire, leading to suspension of construction activities
at the Conga site in late 2011 at the
request of Peru’s central government following increasing protests by anti-mining
activists led by the regional president.
At the core of the controversy are concerns about water. The initial plan called
for draining of four high mountain lakes,
with one to be used as a slag pit.
Opponents claim the project would harm
the water supply, both in quantity and
quality. Protests led the government to
seek an independent assessment of the
project’s environmental impact study, leading to recommendations that two of the
lakes be left intact and that water storage
capacity of the reservoirs be increased.
However, the local opposition is convinced
that the water supply will be adversely
affected even with that revised approach.
In the wake of the protests and mineconstruction shutdown, Minera Yanacocha
has adopted a “water first” philosophy that
is focused on building water reservoirs prior
to the development of other project facilities. Newmont said the project’s plans for
2013 call for spending about $150 million
in capital expenses, including approximately $110 million on equipment, owners’ costs and engineering support; $20
million to complete reservoir construction;
and another $20 million or so for community costs, roads and water systems.
However, Newmont also warned that
development of Conga is contingent upon
generating acceptable project returns and
getting local community and government
support. Should it be unable to continue
with the current development plan at
Conga, Newmont said it “may in the future
reprioritize and reallocate capital to develwww.e-mj.com
opment alternatives in Nevada, Australia,
Ghana and Indonesia, which may result in
an impairment of the Conga project.”
Fighting the Battles
Newmont also has conducted a running
battle of words against what it sees as misleading or incomplete accounts of the project and its approach to water management
in the world press (see below). And, looking beyond the Conga conflict, it’s quite
clear that industry adversaries will continue their efforts to increase pressure on
public-land stewards to suspend or curtail
mining projects in other areas of the world
as well, based on water concerns.
For example, a report released on May
1 by Earthworks—a Washington, D.C.based nonprofit organization that describes
itself as “dedicated to protecting commu-
nities and the environment from the
impacts of irresponsible mineral and energy development while seeking sustainable
solutions”—claims that existing U.S. hard
rock mines will pollute up to 27 billion gallons of fresh water per year, and cost as
much as $67 billion per year to clean, in
perpetuity. The study, titled Polluting the
Future: How mining companies are polluting our nation's waters in perpetuity, also
claims that four proposed new mines could
annually pollute billions of gallons more.
The study lays blame on acid rock
drainage (ARD), which can occur when sulphide-bearing materials are excavated,
exposed to air and water, and then react
with oxygen and water to create sulphuric
acid. The press release accompanying the
release of the Earthworks study quoted Dr.
Glenn Miller, a professor of environmental
Newmont Completes the Conga Picture
From Newmont Mining Corp.’s website:
On February 13, 2013, Bloomberg Markets magazine published a story about conflicts in South America related to natural
resource development projects. The story featured Newmont’s proposed Conga copper and gold project in Northern Peru, near our
existing operations at Yanacocha.
There were a number of features of the article that neglected
to provide a complete picture. Below, we detail some of those
omissions and provide additional information that was left out of
the story.
Totoracocha Lake—The story prominently featured stark images of
Totoracocha’s drying lakebed, falsely claiming the lake was drying
due to blasting at Yanacocha. What the story neglected to mention
is that drying and shrinking lakes are a natural occurrence at this
elevation and location in Peru during the dry season. The photos
used in the story were taken right at the beginning of the wet season, not enough time for Totoracocha Lake to naturally refill following a six-month dry season.
Four Lagoons, Four Reservoirs—The story discussed the Conga project’s plan to replace four lakes, which contribute minimally to
down gradient stream flows during the six-month dry season, with
four engineered reservoirs. The reservoirs provide two benefits over
the lakes. First, the reservoirs will more than quadruple existing
water storage capacity. Second, the reservoirs will provide yearround water availability to downstream users. The lakes only provide a source of water for downstream users when water overflows
into the receiving streams, which is limited to the rainy season.
During the dry season, the natural geologic materials underneath
the lakes severely restrict the amount of water that seeps into the
ground and re-emerges as water flow available to downstream
users. Hence, the lakes are a very limited source of water during the
dry season when downstream users need it the most. In addition to
increasing the overall water storage capacity, the reservoirs will significantly improve the provisioning of water to communities since
flows from the reservoirs will be regulated by engineered outlets
that provide for the controlled and safe release of water, year-round.
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science at the University of Nevada—“No
hard rock open pit mines exist today that
can demonstrate that acid mine drainage
can be stopped once it occurs on a large
scale”—and went on to state that “because acid mine drainage can’t be
stopped, once started it must be treated
until the acid generating material runs out.
As acknowledged in government mine permitting documents, this can take hundreds
or thousands of years.”
In addition to listing existing U.S. mines
that “are known to generate perpetual
water pollution,” the study also identifies
what it terms “existing mines likely to generate perpetual water pollution,” as well as
four proposed mines at which it says perpetual water pollution is predicted or considered at high risk (see table, p. 44).
These mines, according to the study, could
Mine Water Use—The story stated that Conga will consume 2 million cubic meters of water a year. The vast majority of this amount
will be recycled or treated and tested to meet applicable water quality standards before being released to downstream users. The water
needed for the proposed processing operations will be repeatedly
recycled and reused. The recycled water will be stored separately
from rain water captured by the upper reservoir, which will have a
capacity of 7,600,000 cubic meters. Fresh water in the upper
reservoir will be utilized as “make-up” water for the limited losses
and consumption associated with the processing operations and
will also be used to fulfill community and social development commitments during operations. Water availability shortages in the
Cajamarca region are the result of inadequate water storage facilities to capture and store water during the rainy season for use during the dry season. This is in part why we are pursuing a water-first
approach focused on building reservoirs that will more than quadruple water storage capacity in the area. The first of these reservoirs,
Chailhuagon, is expected to be complete during the second quarter of 2013 and will have a capacity of 2,600,000 cubic meters,
more than double the current capacity of Chailhuagon lake.
—www.newmont.com/south-america/press-releases/newmontsresponse-bloomberg-markets-magazine-story.
In Peru, public protests over water issues associated with a proposed mine resulted
in suspension of construction at the mine, pending a satisfactory resolution of the
local population’s concerns about future water quantity and quality.
MAY 2013 • E&MJ 43
generate an estimated 16 billion gallons of
contaminated water per year.
The 52-page report, downloadable at
http://www.earthworksaction.org/files/publications/PollutingTheFuture-FINAL.pdf,
makes several policy recommendations:
• The U.S. Environmental Protection
Agency (EPA) should use Section 404c
of the Clean Water Act to protect Alaska’s
Bristol Bay, which it identifies as “the
nation’s most productive and valuable
wild salmon fishery,” facing possible
degradation from development of the
proposed Pebble mine.
• Reform federal law to require hardrock
mines to demonstrate, at the outset, that
the mine can meet water quality standards without perpetual treatment.
• Reduce perceived risk by restoring federal regulations to prohibit mine waste disposal in waters of the U.S.
• Hold corporations accountable by putting the cost of AMD cleanup on the industry, not on taxpayers.
Looking at the Problem
The foreword to the International Council
on Mining and Metals’ (ICMM) 2012 report
titled Water Management in Mining: A
Selection of Case Studies, spells out, in
broad terms, the future of the global mining
industry and its relationship to water management: “In mining, water is used within a
broad range of activities including mineral
processing, dust suppression, slurry transport and employee requirements. Over the
last several decades, the industry has made
much progress in developing closed-circuit
approaches that maximize water conservation. At the same time, operations are often
located in areas where there are not only
significant competing municipal, agricultural and industrial demands, but also very
different perspectives on the role of water
culturally and spiritually.
“Together, these characteristics lead to
tough challenges and there is no simple
recipe for water management in mining,
particularly because the local environments of mines range from extremely low
to the highest rainfall areas in the world.
Regardless, responsible management of
water by mining companies is a key ingredient in ensuring their contribution to sustainable development is positive over the
long term.”
Left unsaid is the fact that responsible
management of water by mining companies also is a key ingredient in profitable
production: flooded pits can’t be mined,
processing effectiveness can be reduced
by poor-quality water, and sloppy heap
leach operations may draw regulatory fines
that could affect bottom lines, for example.
Savvy mine operators understand the dual
nature of water’s value. It can be an asset
or a liability, depending on its location and
use: water residing within a managed system can generally be regarded as an asset
or resource; while water leaving the system
can often be considered a liability.
In the U.S., Nevada is the driest state
of all, averaging less than 10 in. (250 mm)
of rain per year. It is also regarded as probably the most extensively mineralized state
based on current geological information,
containing in addition to its gold and silver
deposits other commodities such as copper, lithium, vanadium, molybdenum,
tungsten, niobium and 17 rare earth minerals, among others.
With its robust mining industry, rapidly
expanding population centers, and competition for scarce water supplies by industry,
agriculture and municipalities, Nevada
could serve as a bellwether for the global
industry in recognizing and, hopefully,
finding ways to resolve water management
issues in resource-limited regions. The
annual meeting of the Nevada Water
Resources Association, held January 2931 in Reno, confirmed the state’s mine
operators are cognizant of the challenges
and are actively seeking solutions to slake
the industry’s thirst.
Allan Biaggi, former director of Nevada’s Department of Conservation and
Natural Resources and administrator of the
Nevada Division of Environmental Protection, listed a number of the challenges facing the industry in his presentation at the
NWRA event.
• Water is not going to be any less scarce
or less precious;
• New and existing uses of water will compete with mining for Nevada’s water
resources;
• The cost and value of water will increase;
• Water will become more politicized;
• Mineral extraction/production will increase and concurrently water demand
will increase;
• Litigation over water issues will increase;
• Public land managers will have a greater
say over water within their jurisdictions;
• The environmental impacts of mine dewatering will continue to be of concern;
• Post mining features such as pit lakes will
face increased scrutiny and focus; and
• Bonding and other financial assurances
will play a greater role in the long-term
protection of water resources.
Given these prospects, there are specific
steps that can be taken to accommodate
them and ensure the health of the state’s
mining industry in the coming decades,
Biaggi noted, and suggested a few, including:
• State water policy must be adaptable
and capable of responding to changing
Proposed Mines Predicted to Generate Perpetual Pollution, or at High Risk of Perpetual Pollution
Mine
Location
Annual volume of
water requiring
treatment
Annual treatment
costs (operating
and maintenance)
Status
Land ownership
Resource at risk
Donlin Creek
(Donlin Gold)
Alaska
Estimated: 1.7
billion gallons
Estimated: $1.9
million
Proposed
Native
corporation
Kuskokwim
River watershed
Pebble
(Pebble Partnership)
Alaska
Potential,
estimated: 13.8
billion gallons
Unknown
Proposed
State of Alaska
Bristol Bay
salmon fishery
Northmet Project
(Polymet Mining)
Minnesota
Potential,
estimated: 83
million to 256
million gallons
Unknown
Proposed
National Forest
St. Louis River Basin,
aquatic organisms and
wildlife, wild rice,
wetlands, groundwater
Rock Creek
(Revitt [sic] Silver)
Montana
Estimated: 1.2
billion gallons
Estimated: $1.2
million
Proposed
Forest Service
and private
Clark Fork River
Source: “Polluting the Future: How mining companies are contaminating our nation’s waters in perpetuity,” Earthworks, May 2013.
44 E&MJ • MAY 2013
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•
•
•
•
•
•
•
demands, economics and technologies
for all users.
Mining should undertake an effort of
long-term water planning in conjunction
with other users. The goal: optimize
water use and consumption.
Mining will continue to pursue the reuse
and recycling of process waters.
When possible, low-quality water should
be used for mining production.
Mining will develop technologies to reduce volumes of water extracted as
mines go deeper.
Mining will continue to innovate on the
reinjection/restoration of dewatered
aquifers.
Federal and state agencies must ensure
consistent, fair and predictable water
allocation requirements and permitting
processes.
Renewed policy direction to recognize
mining as being valuable to Nevada.
Taking Steps
If the importance of water management
in the long list of a mine’s typical economic and regulatory issues is accepted,
then how is it defined? According to
Matthew Setty, senior project manager
and global mining client manager for
engineering firm CH2M HILL, it comprises “the sourcing, conveyance, diversion,
storage, reuse, treatment, and/or disposal of all water associated with the mine
and mill operation, regardless of use, and
adapting to flow and quality changes
both seasonally and throughout the mine
life cycle.”
It’s an important part of any sustainability program, said Setty, noting that a
company’s mine water management must
be structured to deal with the harsh realities of today’s operating environment; i.e.:
• “No water, no mine.”
• Lower grade ores increase water consumption.
• Climate change and population growth
are increasing competition for water.
Gauging the Value of Water
• Water and environmental issues must be
addressed to obtain or maintain a social
license to operate.
Setty said close attention to water management will be necessary to comply with
increasingly stringent water-discharge
requirements coming from a variety of regulatory sources, such as conductivity limits
proposed by the U.S. EPA, new water quality criteria (e.g., selenium, sulfate, nitrates)
proposed by the EPA and Canadian authorities, and whole effluent toxicity (WET)
requirements from both the EPA and
Canadian agencies.
Water issues change at each stage of
the mining life cycle, and the water management plan must adapt accordingly, he
explained, and starting out with a comprehensive plan is necessary for success. A
plan would typically involve:
• An accounting of all water inputs and
outputs and changes in storage.
• Attention to evaporation and transpiration factors.
• Initial development as part of the Environmental Impact Assessment.
• Realization that corporate reporting of
company-wide water balance is becoming more common.
The plan would ideally be subject to
ongoing refinement and redefinition, and
used throughout the life cycle of the mine.
Marek Mierzejewski, CH2M HILL’s
Water in Mining sector lead and co-presenter with Setty of the NWRA paper,
wrote in the company’s Access Water blog
last year said, “As sustainability and environmental concerns have escalated, the
mining industry faces increasing public,
media, and regulatory scrutiny regarding
how it sources, treats, and manages water.
To comply with more stringent regulations
and maximize efficiency, mining companies now face the need for greater technological and strategic approaches to water
maintenance, treatment and reuse. Concerns of how water is used, recycled,
waste is disposed of and residuals are
Engineering firm CH2M HILL released the report The Changing
Value of Water to the U.S. Economy: Implications from Five
Industrial Sectors in 2012, compiled for the U.S. Environmental
Protection Agency as part of its initiative titled “The Importance of
Water to the United States Economy.” The report, authored by
Mike Matichich, Marek Mierzejewski, Bill Byers, Dan Pitzler and
Sartaz Ahmed of CH2M HILL, examines the critical role water
plays in industrial production and how the value of water is changing in certain major industrial sectors. The information pertaining
to the mining industry is excerpted here.
46 E&MJ • MAY 2013
managed, are boardroom issues for mining
companies these days.
“So water, once considered a readily
available and manageable resource, is now
a major business concern, and frequently a
deciding factor as to whether or not a mine
is developed. This is particularly challenging as mining often takes place in arid and
semi-arid regions, like Chile and Peru,
where water is a limiting factor for the
development and continuation of mining
operations. Many of the papers and presentations at [a recent] conference provided solid data on the benefits of desalination in these areas to increase water supply—important because a remarkable 40%
of global mining projects over the next five
years will be located in Chile and Peru.”
Mierzejewsk, along with four other
staffers at CH2M HILL, authored a report in
2012 that examined the changing value of
water in five industrial sectors: semiconductor manufacturing, thermal power generation, mining, chemicals, and oil and gas.
The mining section focuses on the approach
taken by two mining divisions within Rio
Tinto to adopt water management strategies.
The examples presented in the paper
illustrate what seems to be an emerging
willingness among major mining companies to step outside the confines of their
various operations, look around and engage
with organizations, regulators, other stakeholders and even competing companies to
identify and resolve water-related concerns.
It’s a strategy endorsed by a growing number of mining advisory groups; the ICMM
report referenced above, for example,
states that “engagement with stakeholders
is essential tor each consensus and agreement on the many water issues that affect
the mining sector and the communities in
which it operates.
“The industry’s engagement needs to
be undertaken at global, regional and operational levels, to ensure that it is a constructive voice in the emerging policy
debate,” it concludes.
—Mining companies in the United States, and globally, are exploring proactive approaches to water that consider how to demonstrate the value of water, taking into account not only economics,
but also considering social and environmental factors as well.
At many sites, the operations make use of non-potable water,
thereby avoiding the use of high-quality (potable) water and helping to conserve local water supplies. Although the minerals and
metals industry is a small user of water on a national scale, it can
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OPEN-PIT SKIP SYSTEMS
Cost-efficient Transport for
Open-pit Mines
An innovative technological approach to skip haulage could optimize costs
and energy efficiency in hard rock mines
By Dr. Franz Wolpers
Open-pit metal mines are often shaped
like an inverted cone, with the ore and
overburden being drilled and blasted,
then loaded and transported by shoveland-truck systems. Mine trucks that
weigh between 106 and 260 tons, and
carry payloads from 136 to as much as
400 tons, transport these materials from
the pit bottom along unpaved, slowly rising, winding haul roads to dumping areas
outside the pit, or to a primary crusher
station several hundred meters from the
pit rim. Having run through the primary
crusher, in larger operations the ore is
then often transported via overland conveyors to the concentrator at rates of
10,000 mt/h and more.
The German company ThyssenKrupp
Fördertechnik (TKF)—which supplies mining, crushing, processing and materialshandling systems to operations around the
world—is now in the process of developing
a system that allows hard rock ore and
Figure 1—The steep, circuitous path traveled by haul trucks at Freeport McMoRan Copper & Gold’s Grasberg mine
in Indonesia is typical of open-pit operations in its layout with high walls and winding haul roads. Grasberg mines
and processes around 220,000 mt/d of ore in a shovel-and-truck operation. (All photos courtesy of TKF)
overburden to be transported more efficiently and with significantly lower environmental impact. Already being patented,
it centers on an integrated conveying and
Figure 2—As shown in this illustration, TKF’s innovative transport system consists of a dump station at the
foot of the pit wall; two skips running in opposite directions on a ropeway system, each with an average payload
of 136 mt of ore or overburden; and a track system for the two skips.
48 E&MJ • MAY 2013
processing system that does away with the
need for heavy truck transport in this type
of open-pit mine, which is where much of
the world’s copper, iron ore, gold and other
commodities is produced today.
In overview, a rope-driven conveyor
system is used to transport complete
truckloads of material in track-mounted
skips that run from a loading station in
the pit bottom to the primary crusher on
the pit rim. Inclined at up to 75°, it takes
the shortest route possible up the pit
wall. Like a freight elevator, as one
loaded skip moves upward, an empty skip
moves in parallel downward to the pit
bottom. The two skips are connected via
a rope system, pulleys and a tractionsheave drive system at the pit rim, such
that the dead weight of the skips is fully
balanced at all times and no unnecessary
lifting power is needed.
This article describes the new system, and provides technical and cost
comparisons with conventional heavytruck transport. It highlights the system’s
major advantages with a concrete example, with the aim of giving open-pit operators food for thought when they are planning or redesigning mines in the future.
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Figure 3—Overhead-view schematic of the skip loading and transport system.
The Conventional Approach
to Open-pit Transport
Freeport McMoRan Copper & Gold’s
Grasberg mine in Indonesia is typical in
its layout with steep walls and winding
haul roads. One of the world’s largest
copper-gold mines, Grasberg mines and
processes around 220,000 mt/d of ore in
a shovel-and-truck operation. In Figure 1,
it can be seen that the heavily laden
trucks move up and out of the mine in a
train-like formation on ramped haul
roads, traveling at average speeds of
around 15–20 km/h.
Carrying ore from the pit bottom to the
primary crusher, as well as overburden to
dumping areas outside the mine, the line
of trucks works its way upward on largely
unpaved roads with gradients of up to
9%, until it reaches the top of the pit.
After dumping at the crusher or in a waste
area, the empty trucks drive back down
into the pit by a separate route, with one
truck cycle in an average pit typically taking between 20 and 40 minutes.
Grasberg runs six crusher lines in parallel, with TKF having supplied the operation with three of the world’s largest (63
× 114 in.) gyratory crushers. The mine
uses a fleet of up to 220 trucks to transport its ore and overburden, with the
trucks’ individual payload capacity ranging between 240 and 400 tons. For a
maximum payload of, say, 240 tons, the
dead weight of the truck will be around
160 tons, although the precise figure
depends on the specific truck manufacturer. In essence, however, 160 tons of
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dead weight has to be moved in order to
carry 240 tons of payload.
Across the world, open-pit mines are
getting deeper and haul distances ever
longer, so operators are using larger
trucks with payloads of up to 400 tons
to reduce the size of their truck fleets
and the associated investment, labor
and operating costs. Trucks of this
capacity typically have a dead weight
of some 260 tons, with an installed
diesel-engine output of up to 3,000 kW
(4,000 hp).
TKF’s Alternative
With rising fuel prices and increasingly
stringent environmental constraints likely
to have a long-term impact on traditional
open-pit mine operations, TKF has developed its new system for quasi-direct ore
transport of ore and waste from the pit
bottom or an intermediate level to a pitrim crusher station. This system can then
link in with overland conveyors for onward
transport of both the ore and overburden.
To make a technical and financial
comparison, the pit wall is assumed to
have a 45°–55° slope, with a 200-m vertical rise for transporting the overburden
or ore from the pit bottom (or an intermediate level) to the crusher station at
the top.
The conveying and processing system
consists of an HLT (Heavy Load Truck)
tipping station at the bottom of the pit
wall, two skips running in opposite directions on a ropeway system, each with an
average payload of 136 tons of ore or
overburden, and a track system for the
two skips (See Figure 2). The crusher station, with a headframe and discharge
equipment for the crushed material, is
situated at the top of the pit wall. The
electro-mechanical rope-drive system is
arranged separately from the skip emptying and crushing stations.
In this scenario, trucks shuttle to and
fro over short distances between the
loading points in the pit and the skipconveyor feed station, where loaded
trucks reverse alternately into the tip via
an access ramp. The skips are designed
to take a full truck load, plus a 10%
weight tolerance. Dynamic loads caused
by rock impacts and other factors are
absorbed by the skip being suspended by
the rope system, while impacts on the
skip discharge flap are cushioned safely
by stationary pneumatic-tired buffers.
During skip loading, the rope sag over the
transport distance decreases and the
ropes undergo additional extension. The
Figure 4—The skip headframe, together with the rope sheaves and steel structure, is an integral part of a semimobile or stationary gyratory crusher station, with a feed bin, crusher and discharge conveyor.
MAY 2013 • E&MJ 49
Figure 5—The rope leading from the hoist in the headframe runs over a diverter sheave in the drive station and
is led over two double-groove traction sheaves and a further diverter sheave to the second skip hoist.
resultant positional change of the skip, of
up to 900 mm, is limited by a stop and
is accommodated by the size of the opening of the feed chute.
Figure 3 shows a schematic of the skip
loading and transport system, as seen
from above. Once a skip has been filled
by a truck dumping directly into it, it is
pulled up the track to the crusher station
by a rope hoist, over the 200-m vertical
rise. As one loaded skip moves upward,
the empty skip moves in parallel, downward to the loading station. The two skips
are connected though the rope system,
the rope sheaves and a traction-sheave
drive system, such that their dead weight
is fully balanced all the time.
Once it arrives at the pit rim, the
loaded skip moves into the crusher-station emptying position with a predefined
time lag. At the same time, the empty
skip is positioned in the loading station
below. The skip headframe, together with
the rope sheaves and steel structure, is
an integral part of a semi-mobile or stationary gyratory crusher station, with a
feed bin, crusher and discharge conveyor
(See Figure 4).
When the skip moves into the highest
conveying point above the crusher feed
bin, the discharge flap opens automatically or under remote control, with the
full load being discharged into the bin
over a period of roughly 25 seconds.
Loading of the empty skip takes place
simultaneously.
The crusher station also has an emergency or redundant truck-loading system,
a crane for maintenance work and a
50 E&MJ • MAY 2013
hydraulic breaker for breaking up oversize,
with a discharge conveyor below the gyratory crusher continuously feeding a conventional overland conveyor with crushed
ore or overburden for onward transport.
The Rope-drive System
The rope-drive system is anchored in a
separate station roughly 30 m away from
the crusher and the pit rim. The overall
height of the crusher station, with the
headframe, is roughly 50 m—which is fairly tall but not unusually so. For comparison, the three 10,000-mt/h TKF crusher
units at Grasberg stand 47 m high, which
is nearly the same as the height of the
crusher/skip system described.
To reduce the rope load and limit the
drive moments, each skip is suspended in
a hoist. In this example, the rope has a
diameter of 54 mm and runs over six,
4,320-mm-diameter sheaves on each
skip. The two rope ends are firmly anchored in the headframe by means of an
adjustable length-compensation system.
The rope leading from the hoist in the
headframe runs over a diverter sheave in
the drive station and is led over two double-groove traction sheaves and a further
diverter sheave to the second skip hoist
(See Figure 5). The drive moments of
the two 1,300-kW-rated motors are transmitted with virtually no slip through a
total loop of 540° by the two yellow traction sheaves.
A top view of the two identical drive
units is shown in Figure 6. Each drive
train consists of a variable-frequency
asynchronous motor, a disc service brake,
a helical gear unit, a flexible coupling
and a double-groove rope sheave that is
clamped to the drive shaft.
The diameter of the rope and traction
sheaves is determined, among other
things, by the German TAS mining standard, which covers technical requirements for shaft and inclined haulage systems. This requires the ratio of the
sheave diameter to the rope diameter to
be greater than or equal to 80, so TKF
has chosen a sheave diameter of 4,320
mm for a 54-mm rope. The rope safety
factor is greater than seven. In addition
to the service brakes in the drive train,
each traction sheave is fitted with safety
or holding brakes.
The two-sheave drive system described here is not new, of course, and it
has proved successful in numerous
Figure 6—Layout and major components of the system’s two identical drive units.
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Figure 7—TKF’s two-sheave drive system is not new, having proved successful in numerous heavy-duty elevator
and ropeway systems. This photo shows a typical rope drive system from an installation in Switzerland.
heavy-duty elevators and ropeway systems. A typical rope drive system from an
installation in Switzerland, for which the
drive power is 2 × 1,150 kW, the rope
diameter is 58 mm and the sheave diameter is 4.6 m is shown in Figure 7.
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The Skip Design
In this example, the skip for a 136-ton
truck-load of ore—equivalent to 75 m3—
is 4 m wide, roughly 13 m long and has
a fill height of 5 m. The skip has a design
capacity of 90 m3 and needs a dead
weight of around 90 mt to guarantee
power transmission in the rope drive system. The number and size of the bogies
are determined by the steepness of the
track, the rail profile and the allowable
wheel-contact pressure. In this case, a
two-wheel bogie with 710-mm wheels is
mounted at each skip corner, matching
the A100 rail. Side guide rollers are also
fitted on each bogie.
Ore is fed into the skip through an
opening below the rope sheave system.
When the skip moves into the dump station, the discharge flap opens automatically. The skips have a locking mechanism on either side for unlocking and
locking the discharge flap. Once a skip
reaches the topmost conveying position,
the flap is unlocked by an external mechanism and is then opened in a controlled
manner by a hydraulically operated support carriage with thrust rollers. Once the
skip is empty and the trip down has
begun, the flap is closed by the support
carriage and is safely locked.
In a typical work cycle from skip
loading to unloading, for a rise of 200 m
on an incline of 45°–55°, the skips
have to cover a total distance of 285 m.
With a maximum rope speed of around
MAY 2013 • E&MJ 51
11 m/s and six-part reeving, the skip
speed is 1.9 m/s (around 6.9 km/h).
Skip loading takes 25 seconds, as does
emptying at the top station, while skip
acceleration and deceleration each
require 5 seconds.
A complete conveying cycle, from
loading to unloading, therefore takes 180
seconds or 3 minutes, so trucks with 136
tons of payload can drive into the tipping
station at the bottom of the mine every 3
to 5 minutes.
Economic Comparison
As a way of illustrating the advantages of
TKF’s system over conventional truck
haulage, a number of assumptions have
been made to provide the basic parameters for the comparison. In this case, the
system handles ore with an average density of 1.8 mt/m3, trucks with an average
payload of 136 mt are used to load the
skips, and the vertical rise is 200 m over
a 45°–55° incline.
Using 2 × 1,300-kW drive power, the
rope and drive systems are designed for
20 cycles per hour and a handling capacity of 2,720 mt/h. It can be assumed that
this design will be capable of handling
more than 2,000 mt/h of ore or overburden on average. Table 1 compares typical
parameters of the skip-conveying and
truck haulage systems.
For an average handling rate of 2,000
mt/h of ore, seven trucks, each with a
payload of 136 mt, must travel 2 ×
2,500 m on a haul road with an 8%
(4.6°) incline to overcome a vertical rise
of 200 m. If the payload being moved is
set in relation to the dead weight of a
truck, which must be multiplied by two
because of the empty trip back into the
pit, the transport efficiency for the trucks
is just 37%. The ratio of payload to truck
weight is a very unfavorable 1.2:1.
With the skip system, by contrast, the
dead weight of the skips is balanced completely, so the drive system does not have
to expend additional energy to transport
the empty skip. A comparison of the
installed power shows 7 × 1,082 kW
(7,574 kW) for the truck fleet but just
2,600 kW for the skip system, giving an
installed power ratio, in this case, of nearly 3:1. Ratios are typically between 2:1
and 3:1, according to TKF’s calculations.
If we compare the use of manpower—
excluding crusher and maintenance personnel—20 to 25 truck drivers per day will be
needed for multi-shift mine operation, plus
one driver each for a water-spray truck and a
grader for road upkeep. Being fully automatic, the skip system has no labor requirement,
thereby saving the cost of up to 27 operators.
Another significant advantage for the
skip conveyor is its lower CO2 footprint. If
a skip conveyor is used instead of trucks
to handle 2,000 mt/h of ore, TKF has
calculated that CO2 emissions can be
reduced by up to 29 mt/d.
The Financial Advantage
With its combination of tested technologies, a skip conveyor system offers significant advantages compared with a
truck haulage system, including:
• In-mine transport cost savings of up
to 50%;
• The shortest transport distance by
using a steeply inclined system;
• Energy savings, since energy only
needs to be expended for transporting
the payload. The dead weight in the
system is completely counterbalanced;
• The crusher station can be positioned at
the pit rim or at an intermediate level; and
System
Transport Distance
Transport Efficiency
(moved payload/moved power-effective total load)
Ratio of Payload to Truck Weight
Total Installed Power
• The mine’s CO2 footprint can be cut significantly through reduced truck traffic.
TKF’s skip-conveyor system represents environmentally friendly technology
with minimal noise and dust emissions.
It also has the potential to provide higher transport availability, since it remains
fully operational in conditions such as
snow, fog or rain.
In addition, mines can cut their costs
for haul-road upkeep, and for the maintenance of the fewer trucks that are needed
to move the ore from the pit shovels to the
skip-loading system. Having fewer trucks
also means lower operating and personnel
costs. Last but not least, mines will be
looking at lower investment costs because
truck fleets can be cut significantly.
TKF is now developing this innovative
skip-conveying system with integrated
ore and overburden crushing. The company is studying the design of the drive
and conveying components, as well as
investigating technical implementation
at a suitable mine. A system like this will,
of course, have to be adapted to actual
mine conditions, and the technical and
financial aspects of using the system will
have to be clarified in advance, working
together with the mine-operating company involved.
TKF believes that many open-pit mine
operators who are faced with rapidly rising production costs while using conventional transport concepts now have a genuine, cost-effective alternative.
Dr. Franz Wolpers is the executive vice
president for TKF’s materials-handling
business unit, and head of the company’s central R&D division. He can be
reached at +49 6894 599 434 or at
[email protected].
Skip Conveying System
Truck Fleet
2 skips, 136 tons each
7 trucks, 136 tons each
0.29 km, 55° slope
2×2.5 km, 4.6° (8%) slope
100%
37% (136/(2×113.5+136)
-
1.2 (136/113.5)
2×1,300 = 2,600 kW
7×1,082 = 7,574 kW
Installed Power Ratio (truck traffic : skip system)
1
2-3
Manpower
(without crusher operations and maintenance staff)
0
20–25 truck drivers per day, plus 1
water truck driver and 1 motor grader
driver for haul road maintenance
29,000 kg CO2 per day
—
CO2 Reduction (compared with truck system)
Assumptions: 2,000 mt/h ore handling; 200 m vertical rise
Table 1—Comparison between conventional truck traffic and the new skip-conveying system in an open-pit mine.
52 E&MJ • MAY 2013
www.e-mj.com
M E TA L A C C O U N T I N G
Is Your Business Safe from Metal
Accounting Risks?
An automated, systematic approach is required to deliver comprehensive,
timely and validated information
By Kate Lothian
Rigorous corporate governance requirements and turbulent
economic conditions have put intense pressure on mining
organizations to improve their metal accounting practices.
Inaccurate estimates of metals inventory and processing
plant performance pose huge risks including undetected losses, lack of market responsiveness, and ultimately lost profits.
Times are tough for mining companies. The global economic outlook is bleak, and even China is no longer immune
from the slowdown. With several recent reports of profit
slumps, the world’s largest mining companies are starting to
struggle in this environment. In addition, Sarbanes-Oxley and
other similar regulations make senior management personally responsible for accounting figures, while any whiff of
potential wrong-doing will result in a severely damaged reputation. Organizations must have efficient business processes
to maximize production and exemplary financial accounts
that can stand up to intense scrutiny.
54 E&MJ • MAY 2013
The importance of spotless metal accounting was underlined when a group of six companies including BHP Billiton
and Anglo American developed a set of rigorous yet practical
metal accounting guidelines (AMIRA P754 code). These
guidelines stress the importance of “mine to product” stateof-the-art metal accounting solutions, which improve the
credibility and transparency of the reporting process.
Accounting for the transformation of raw materials into
concentrates and finished metals is a very unique, complex
and time consuming undertaking. Without a “mine to product” solution providing an accurate, single view of metal
content, product grade and production data, how can companies truly know the financial health of their business, and
be sure they are safe from metal accounting risks?
Nevertheless, many mining organizations continue to rely on
inadequate manual and rudimentary solutions to manage
metal accounting.
www.e-mj.com
By adhering to the following 10 Best Practices of
Metallurgical Accounting and implementing a powerful enterprise metal accounting software solution, organizations can
reduce risk, maximize profitability and ensure compliance
with the AMIRA code.
10 Best Practices of
Metallurgical Accounting
1. Straight-Through Processing: Completeness and Integration
Best practice metal accounting requires Straight-Through
Processing (STP)1 of data throughout the entire accounting
cycle to ensure a single, accurate and auditable view of production. There should never be any need for re-keying of
data or manual intervention; all data should be automatically processed in one metal accounting system and integrated
into the business via mine, process, laboratory and enterprise resource planning systems.
2. Measurement Accuracy
The foundation of any metal accounting strategy is the input
of good quality data. Plants must ensure that sampling
equipment is fully functional by performing on-going maintenance tests to identify any source of bias.
3. Data Redundancy and Validation
To increase the accuracy and reliability of data, organizations must ensure sufficient redundancy and adequate reconciliation of their mass balancing data. Without data redundancy mass balances have to be performed on non-validated
data, which means inconsistencies cannot be checked and
rectified. Once redundancy is established, organizations must
be able to reconcile their data by turning inconsistent data
into coherent and reliable mass balances. Effective redundancy and reconciliation can only be achieved by a mass balancing engine that is fully integrated into an enterprise metal
accounting solution, which can take data from multiple sources
to rectify errors and improve data accuracy and reliability.
4. Target Accuracy
Best practice is considered to be setting targets to define
acceptable levels of accuracy for each input and output
stream, assessing whether targets are met, and in cases
where they are not, identifying and correcting the problem.
Attempting to achieve this without a statistical data reconciliation engine is impossible; how can accuracy be measured from non-redundant data? A data reconciliation engine
that is integrated into an enterprise metal accounting solution ensures that all corrections and investigations are recorded and assessable throughout the accounting cycle.
5. Provisional Data
Reporting deadlines often require the use of provisional data
before reconciliation and error detection has been completed. To effectively manage this process, organizations need to
rely on a system that outputs provisional production numbers in a consistent and auditable way, showing how
and when these numbers become finalized.
Straight-Through Processing (STP) is a mechanism that automates the end-toend processing of metal accounting data without the need for re-keying or manual
intervention. It involves use of a single system to process or control all elements of
the accounting workflow from initial raw data to final transformation into official
production figures. The concept originated in the financial industry but its ability to
reduce systemic and operational risk has extended its reach into other sectors
including oil, gas and now mining.
1
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MAY 2013 • E&MJ 55
6. In-process Inventory
In-process inventories can represent a significant amount of
money; their estimation is essential in order to value an
operation. Inventories need to be verified by regular physical
stock-takes with clear procedures for stock adjustments and
ultimately unaccounted losses or gains. A solution is needed that can reconcile differences in measurement results,
ensuring any changes to in-process inventories are both
transparent and auditable.
7. Timeliness
One of the most time-consuming and tedious tasks dedicated to metallurgical engineers is the computation of production numbers. This process must be timely to ensure there
are no gaps in financial records. Organizations need to have
an automatic system of reporting that delivers timely production information for financial reporting cycles.
8. Auditability
Any accounts that do not have a record of exactly how numbers were achieved, who provided them, and how particular
adjustments were arrived at will not satisfy auditors and lead
to serious questions over corporate governance. Effective
metal accounting solutions are those that not only transform
process data into coherent accounting figures but crucially
do so in a fully auditable way.
9. Transparency
Best practice in this area requires users to understand the
entire metal accounting system. What is required is a centralized metal accounting solution that provides full transparency and enables drill down into each accounting figure
to see exactly where the data came from, how calculations
were made, and conclusions reached.
10. Documentation
A fully documented solution is required that clearly describes, with words and diagrams, how the metal accounting
process works. This should be made available to all current
and new users.
Enterprise Metal Accounting Solution
A successful metal accounting strategy must ensure compliance
with the 10 Best Practices of Metallurgical Accounting. The only
way to do this, as recommended by the AMIRA code, is to have
a “mine to product” state-of-the-art metal accounting solution.
Failure to effectively account for the concentration and
extraction of metal poses huge risks. Undetected losses, lack
of market responsiveness, lost profits, and failed corporate
governance will not only be perceived by shareholders and
auditors as irresponsible, but could ultimately lead to organizational collapse.
By putting in place an enterprise metal accounting solution,
companies will enhance decision making to maximize efficiency, drive profits and significantly reduce the risk of non-compliance with corporate governance policies.
Forward thinking organizations that want to survive in
today’s turbulent conditions should follow in the footsteps of
companies like Vale, Xstrata, ArcelorMittal and Rio Tinto, and
install enterprise metal accounting solutions.
Lothian is director of product business development at Triple
Point Technology, a leading global provider of on-premise and
in-cloud commodity management software that delivers
advanced analytics for optimizing end-to-end commodity and
energy value chains.
Effective metal accounting solutions are those that not only transform process data into coherent accounting figures but crucially do so in a fully auditable way.
56 E&MJ • MAY 2013
www.e-mj.com
SUPER HUBS
Vale Creates Super Hubs
for Iron Ore Logistics
Using deep-water ports, Valemax vessels will lower iron ore shipping costs for Asian,
Middle Eastern and European customers
By Dave Gambrel
On December 29, 2012, Vale Sohar, one
of the largest bulk carriers in the world,
was welcomed to Oman by members of
the North Al Batinah community, headed
by H.E. Sheikh Hilal bin Ali Al Habsi,
Wali of Sohar. With the capacity to transport 400,000 mt of mineral cargo, the
vessel docked at Vale’s deep-water jetty
in the Port of Sohar to unload iron ore on
its first voyage from Brazil. In November
2012, Vale Liwa was the first Omaniowned Valemax to call.
First Super Hub: The Port
of Sohar, Oman
In mid-July 2012 three loaded Valemax
vessels were on their way to the Port of
Sohar in Oman. This was one of the first
steps in operating a new super hub for
Vale’s Brazilian iron ore. Before Vale
began ordering the first of its Valemax
fleet in August 2008, they realized there
were only a few deep-water ports in the
world where they could unload them, and
they began taking steps to secure them.
The Port of Sohar in Oman was one of
them. Vale would build super hubs based
on three key elements: ideal location,
iron ore pelletizing plant, and port facilities capable of discharging a Valemax.
As a result of business collaboration
with Vale, the Sultanate of Oman invested
$12 billion on the development of Sohar
Industrial Port, and has built the first super
hub in Sohar. In May 2008, Vale and Sohar
Industrial Port Co. signed a 50:50 joint
venture agreement between the government of the Sultanate of Oman and the
Port of Rotterdam to construct a production facility and distribution center for iron
ore pellets in the Port of Sohar. This was
Vale’s first iron ore venture outside Brazil,
and its total commitment would amount to
$1.356 billion. From this super hub in
Oman, Vale is now poised to reach customers in Saudi Arabia, the UAE and India.
Vale Liwa, the first of four Valemax vessels built for Omani Shipping, was welcomed to the Sultanate by members of the
community in North Al Batinah, led by Sheikh Said bin Humaid al Harthy, Wali of Liwa. The remaining three vessels, Vale
Sohar, Vale Saham and Vale Shinas are a tribute to seafaring coastal cities and Omani leadership’s way of showcasing
Oman to the world. (Photo courtesy of Oman Daily Observer)
58 E&MJ • MAY 2013
With two of the four Valemaxes built
for Oman Shipping Co. now in service,
the world is witnessing the start of a new
logistics era for the region. The first vessel to arrive in Oman was Vale Liwa,
which unloaded its shipment of iron ore
in November. Vale Sohar sails from Brazil
to Oman, carrying the history and pride of
the Omanis to unveil it to the whole
world. It is currently en route to the Port
of Tubarao in Brazil for reloading. The
two remaining vessels, Vale Shinas and
Vale Saham, are currently in the final
stages of construction, and were scheduled to be handed over during the first
quarter of 2013.
Due to the large capacity of Valemax
vessels, the shipments create a virtual
iron ore mine in Oman, ultimately allowing Vale to serve its growing network of
clients in the Middle East, North Africa
and Indian subcontinent faster and more
efficiently. So far nine ports around the
world have received Valemax ships—
Dalian (China), Villanueva (the Philippines), Tubarão and Ponta da Madeira
(Brazil), Taranto (Italy), Rotterdam (the
Netherlands), Sohar (Oman) and Kimitsu
and Oita (Japan)—as well as a floating
ore transfer station in Subic Bay in the
Philippines. China could easily add
another three by mid-2013 if it so
desires. (See China’s Deep Water Ports,
Coal Age, December, 2012). By the end
of 2013, 35 ships each capable of transporting 400,000 metric tons (mt) will be
available to carry iron ore for Vale—19 of
them owned by Vale and 16 chartered by
Vale through long-term contracts.
Vale has achieved full production
capacity of 9 million mt/y of direct-reduction pellets at its industrial complex in
the Port of Sohar. Vale’s Industrial Complex comprises two pelletizing units, each
with a nominal production capacity of 4.5
million mt of direct-reduction pellets per
year, and a distribution center with a
throughput capacity of 40 million mt/y.
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SUPER HUBS
Vale Sohar, the second of four Valemax Vessels to be delivered to Omani Shipping. (Photo courtesy of Rongsheng Heavy Industries)
Vale has also invested $40 million in
technologies to reduce the project’s environmental impact, such as electrostatic
precipitators and a 3,150-m-long wind
fence to control particulate matter emissions. The site has a continuous emissions monitoring system and 100% of the
water used is recycled.
The Second Super Hub:
Teluk Rubiah, Malaysia
Vale has devised a masterful strategic
plan. It was working on the construction
of two super hubs long before most of the
world ever heard of Valemax vessels. The
Sohar pelletizing plant was operational in
March, 2011; the Teluk Rubiah pelletizing plant and terminal are still under
construction.
Vale will set up an iron ore pelletizing
plant in Lumut, Malaysia, after its $1.3
billion maritime terminal in Teluk Rubiah
is completed in the first half of 2014.
Total capital expenditures are expected to
reach $5 billion before the distribution
center is complete. It will serve customers
in the Asia-Pacific. From an initial capacity of 60 million mt, it is expected to increase to 200 million mt when complete.
Vale’s loading docks in Brazil are three
times further away from Asian markets
than its Australian competitors. The
Valemax vessels, costing much less per
ton to operate than smaller vessels, will
even the playing field somewhat. Once the
Teluk Rubiah distribution center begins
operating, iron ore from Brazil will be
transported to Teluk Rubiah in Valemax
vessels. From here, the blended ore will
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be distributed to customers in China,
Japan and Taiwan using smaller vessels.
If we count the two floating transfer
terminals, Ore Fabrica and the under-construction Ore Sessogo, it works out to be
two super hubs and two mini hubs under
direct Vale control. The vessel Ore
Sossego arrived at Chengxi Shipyard just
upriver from Shanghai on November 1,
2012. It is the sister vessel of Ore
Fabrica, which was converted from an ore
carrier to a floating transfer station during
the end of 2011 and beginning of 2012.
Like the Ore Fabrica it will be strategically placed for transferring Valemax iron ore
cargoes to smaller vessels for final delivery to customers in shallow draft ports.
Once Vale’s second floating ore transfer station begins operating, which was
planned for the first quarter of 2013,
Vale will be fully prepared to serve Asian
markets on an equal footing with its competitors based in the region. This entire
logistics solution, encompassing ships,
transfer stations and distribution centers,
is expected to be in place by the start of
2014. Vale is truly changing the world of
iron ore logistics.
The Key to the Strategy:
Valemax Vessels
Perhaps the first time the average iron
ore marketer heard of Valemax vessels,
Vale’s gigantic 400,000-ton iron ore carriers, was in connection with China refusing to unload them in 2012 due to safety concerns. No doubt competitors everywhere silently cheered. The typical reaction among the maritime community was,
“What is Vale going to do now? They
have ordered 35 of these giants, and they
have nowhere to unload them.” In fact, it
was recently reported that “they have
been drifting aimlessly since May last
year.” [SteelGuru.com, December 8,
2012]. Valemax vessels have actually
made more than 31 deliveries and have
experienced none of the safety problems
that are China’s source of concern.
They are slightly longer than the aircraft carrier USS Enterprise. Vale had 20
of the Valemax vessels working by year-end
2012. The 14 Valemax vessels operating
in September had made 31 deliveries: 10
to Sohar (Oman); 10 to Subic Bay
(Philippines); six to Taranto (Italy); two to
Rotterdam; and one each to Oita (Japan);
Villanueva (Philippines); and Dalian
(China). The Port of Tubarão in Vitória,
Brazil, received the Vale Espírito Santo on
October 30th. Named for the state that is
home to the company’s most important
iron ore export port, the ship was to be
loaded with ore before sailing to the Port of
Sohar in Oman. This would be the ship’s
first loading operation and the tenth time
a Valemax vessel has docked at Tubarão.
The Vale Espírito Santo is one of 18
ships already operating, out of a total
order for 35 ships owned or chartered by
Vale, placed with Chinese and South
Korean shipyards, to be delivered by
2013, and to operate exclusively for the
company. In July, five loaded Valemax
vessels were headed for its Ore Fabrica
transloading facility in Subic Bay,
Philippines. All were loaded to the maximum draft of 23-23.2 m at Vale’s Sao
MAY 2013 • E&MJ 59
SUPER HUBS
Luis Terminal in Ponta da Madeira,
Brazil. The 280,000-mt Ore Fabrica,
previously a crude oil tanker, has been
reconfigured to serve as a platform for
unloading the Valemax vessels and loading the ore into smaller vessels that can
unload without question at Chinese iron
ore terminals.
For anyone that might have thought
the Chinese port ban would stop the
Valemax building program in its tracks,
take a look at what is happening now.
Clearly, Vale had mad backup plans to
unload their vessels at deepwater terminals closer to the Middle East and Asia,
and was not totally reliant on China’s
ability to unload them. Vale knew all
along there were a few significant deep-
water terminals outside China, and made
plans to use them. Nevertheless, Vale has
also done everything in its power to make
its logistics system work for the Chinese.
Eventually, the Chinese will permit their
deep water terminals to take the
Valemaxes directly, but in the meantime,
the Valemax vessels will keep working to
minimize shipping costs for Asian,
Middle Eastern and European customers
that do business with them.
Perhaps it is time for China to start
opening a few of its deep-water terminals
to Valemax vessels. Not only has Vale
proven Valemax safety with 18 vessels
making over 31 deliveries to seven different terminals, they have done so at great
expense to the company. The Chinese
Valemax Fleet of Ultra Large Ore Carriers (ULOCs)
Name
Vale Brasil
Vale Rio de Janeiro
Vale Italia
Vale Malaysia
Vale Carajas
Vale Qingdao
Vale China
Vale Dongjiakpou
Vale Dalian
Berge Everest
Berge Aconcagua
Berge Jaya
Berge Neblina
Vale Indonesia
Vale Fujiyama
Vale Minas Gerais
Vale Beijing
Vale Espirito Santo
Vale Hebei
Vale Shandong
Vale Jiaangsu
Vale Caofeidian
Vale Shanghai
Vale Korea
Vale Majishan
Vale Tianjin
Vale Rizhao
Vale Ningbo
Unnamed
Unnamed
Unnamed
Builder
Daewoo
Daewoo
Daewoo
Daewoo
Daewoo
STX
Jiangsu
Jiangsu
Jiangsu
Bohai
Bohai
Bohai
Bohai
STX
Jiangsu
Daewoo
STX
STX
Jiangsu
Jiangsu
Jiangsu
Jiangsu
Jiangsu
Daewoo
Jiangsu
Jiangsu
Jiangsu
Jiangsu
STX
STX
STX
Year Draft, m
2011
23.0
2011
11.5
2011
22.9
2012
15.0
2012
12.5
2012
14.1
2011
19.1
2012
19.4
2012
11.0
2011
18.0
2012
13.5
2012
10.9
2012
2012
19.1
2012
13.5
2012
19.1
2011
22.9
2012
13.5
2012
23.0
2012
11.3
2012
2013
2013
2013
2013
2013
2014
2014
Vale Liwa
Jiangsu
2012
10.3
Vale Sohar
Vale Saham
Vale Shinas
Jiangsu
Jiangsu
Jiangsu
2012
2013
2013
19.4
Load Port
Sao Luis
Sao Luis
Tubarao
Tubarao
Destination
Oita
Sao Luis
Subic Bay
Tubarao
Sao Luis
Sao Luis
Sohar
Tubarao
Rotterdam
Sao Luis
Sao Luis
Tubarao
Sao Luis
Tubarao
Tubarao
Subic Bay
Sao Luis
Rotterdam
Subic Bay
Subic Bay
Subic Bay
Sao Luis
ETA
1/14/13
2/1/13
1/29/13
12/15/12
12/24/12
12/30/12
1/17/13
12/30/12
12/31/12
1/1/13
12/20/12
12/13/12
1/29/13
1/7/13
12/25/12
12/16/12
12/31/12
1/19/13
OMANI SHIPPING VESSELS
Tubarao
12/5/12
Tubarao
Sohar-Oman
12/14/12
ban on unloading Valemax vessels costs
Vale $2/mt to $3/mt of ore, because Vale
has built the transfer vessel Ore Fabrica
to transfer ore to smaller vessels in Subic
Bay, Philippines. Vessels that should be
saving $6/mt in shipping are actually
costing Vale money, all for the sake of
nurturing its best customer, China.
Dave Gambrel is the president of
Logisticon, a transportation consultancy.
He was director of transportation for
Peabody Coal Co., and was in charge of the
company’s global shipping program. He
was a member of the U.S. negotiating team
for the LAXT terminal, and a member of
the DTA management committee. He may
be reached at [email protected].
IMO
9488918
9572329
9572331
9572343
9593919
9575450
9522972
9532513
9532525
9447536
9447548
9447550
9447562
9575474
9575486
9593957
9575448
9575462
9532537
9532549
9532551
9532575
9532587
9593969
9532599
9532604
9532616
9532628
9575498
9575503
9575515
9566514
9565065
9566526
9566538
Comments
Left Singapore 12/27/12
Armed guards onboard
At anchor 1/1/13
Not yet in service
Repaired by STX
Placed in service 10/30/12
Launched, but not in service
Estimated
Estimated
Estimated
Estimated
Estimated
Estimated
Estimated
Delivery-3/13
Delivery-6/13
Delivery-7/13
Delivery-9/13
Delivery-12/13
Delivery-3/14
Delivery-7/14
First Omani vessel to
unload at Sohar
Second Omani Shipping vessel
Estimated delivery 1/13
Estimated delivery 2/13
Italicized vessels were placed in service after mid-July. (Data informatiron as of 1-2-13)
60 E&MJ • MAY 2013
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UTILITY EQUIPMENT
Mine Utility Vehicles: Function
Dictates Form
From tiny tracked machines no taller than a table to heavy haulers with light-touch
ground pressure, a wide selection of vehicles is available for moving workers and
supplies where they’re needed, underground or in rough terrain
MINExpo 2012 offered a rare opportunity
for manufacturers of all types of mining
vehicles to display their product lines to
the global mining industry at one venue.
Interspersed with the heavyweight OEMs
exhibiting at the show, such as Caterpillar, Komatsu, Hitachi and others, were
mid-tier and smaller vendors that specialize in designing and building utility vehicles and equipment—the often-ugly but
tough, no-nonsense machines that perform a wide range of jobs necessary to
keep surface and underground mines supplied with the materials, manpower and
support needed to maintain production at
optimal levels.
E&MJ looks at products recently introduced in this sector—both at MINExpo
and in the months following—ranging from
go-anywhere personnel carriers and carryall transporters to specialized haulers and
handlers designed to accommodate the
oversized components commonly found on
mine production equipment.
Low-Profile Cement
Transporter
Germany-based Putzmeister Group has
been designing, developing and producing
concrete spraying equipment for mining
and tunneling for more than 30 years.
Atlas Copco’s Chargetec UV2 multidirectional ANFO charging truck is the latest in a line of charging trucks originally developed by the underground products division of GIA Industri AB, acquired by Atlas Copco in 2012.
Following the launch of its Mixkret 4 lowprofile concrete mixer, Putzmeister has
further expanded its concrete transport
range by adding a low-profile cement and
dry mix transporter for mine applications,
the Cemkret 8.
According to Putzmeister, the Cemkret
8 is intended to expedite ground-control
Putzmeister’s Cemkret 8 can carry more than 8 tons of cement or dry mix, and offers an optional 120-liter additive
tank. Discharge rate is 50 mt/h.
62 E&MJ • MAY 2013
work processes commonly used in underground mining. The transporter has a drybulk transport capacity of 8.25 metric
tons, and can offer a speedy discharge
rate of 50 mt/h due to its four-electric
vibrator, dual hydraulic auger design. An
optional 120-liter-capacity additive tank
also is available.
It features a 6-cyliner, 130-kW (174hp) turbocharged diesel engine, providing
sufficient power to give the vehicle a 20km/h (12.5 mph) top speed and strong
tractive capacity up to a 30% grade, as
well as the ability to work at high altitudes.
The unit has a hydrostatic transmission
with continuous variation (ICVD), which,
according the company, ensures an ideal
torque-to-speed ratio.
Compact design and state-of-the-art
axles provide mobility and maneuverability
in narrow galleries and tunnels. The cabin,
mounted in-line with machine direction,
along with a night-vision camera at the
rear, give the operator a high level of visibility and control when operating in tight
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UTILITY EQUIPMENT
Normet’s Charmec MF 605 D ANFO truck provides sufficient tank capacity to eliminate the need to refill during most charging operations.
spaces. The Cemkret 8 also features an
automatic speed control system for safe
movement down-ramp while fully loaded at
the maximum secure speed.
Quick-Charging, HighCapacity ANFO Trucks
Among the many items of utility equipment
introduced at MINExpo 2012 were two new
explosives charging trucks for underground
production blasting operations.
Atlas Copco launched its new multidirectional ANFO charging truck, the
Chargetec UV2, designed to offer highspeed charging capacity of 286 lb/min
(130 kg/min) with high density. This model
is the latest generation of charging trucks
originally developed by the underground
products division of GIA Industri AB,
acquired by Atlas Copco in 2012.
The single-boom truck is equipped with
one or two vessels for optimized charging
of a full drill pattern with fixed carrier positioning. The vessels are available in volumes of 300, 500, 750 or 1,000 liters
(537, 895, 1,342 or 1,790 lb).
The heavy-duty carrier has articulated
frame steering and four-wheel drive, giving
it flexibility and high maneuverability in
narrow drifts. It may be equipped with
diesel or electric hydraulics. The operator
is provided with a FOPS-II approved
canopy or cabin, and a comfortable seat
with arm rests. A passenger seat is also
standard, and both seats come with a twopoint safety belt.
Also at MINExpo, Finnish mine equipment manufacturer Normet introduced the
Charmec MF 605 D, powered by a 110kW Tier 3 diesel engine that provides a
maximum speed of 15 mph (25 km/h) on
the flat and 5 mph (8 km/h) up a 1:7
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ramp. The unit features a new layout providing space for ANFO or emulsion units
in the center of the machine, and its modular structure makes it easy to convert an
ANFO charger to emulsion charger and
vice versa if necessary, said Normet. An
operator’s work stand behind the ANFO
vessels makes filling the unit more convenient, while an optional vacuum extractor mechanizes ANFO filling, allowing
prills to be loaded directly from ANFO
bags to the vessels.
According to Normet, the machine’s
standard 2 x 500-liter ANFO vessels provide enough explosive capacity to charge
most tunnel faces without need for refill
during charging. Optional 2 x 250 / 360 /
720-liter vessels are available if desired.
Dedicated storage spaces for stick powder boxes, primers and detonators allow
Oldenburg’s SV-11 small-heading scaler was introduced at MINExpo 2012.
MAY 2013 • E&MJ 63
UTILITY EQUIPMENT
turning radius of 13 ft 3 in. (4 m) and an
outside turning radius of just more than
20 ft 8 in. (6.32 m).
The low-reach scaler combines an articulated chassis and independent boom
swing to achieve optimum setup coverage.
Additional features include a ROPS/
FOPS-certified enclosed cab, bulletproof
Lexguard shield, standard scaling pick that
provides high breakout force, dual joystick
operating, slanted design for optimum
scaling view, standard air filtration, air conditioning and heat. In addition, an optional hydraulic hammer can be added to further enhance scaling abilities.
Heavy Lifting, High
Maneuverability
Featuring high lifting capacity and long reach, Stellar’s TM20165 manipulator can handle the largest OTR tires—
at both inside and outside position on duals—without repositioning.
workers to bring all needed explosives to the
workplace at once and eliminate the need
for an additional explosive service vehicle.
The Charmec MF 605 D is equipped
with a NBB 3XS boom, carrying a two-person-capacity basket and providing a lifting
capacity of 500 kg, that is specially designed for charging work in stopes. The
machine can be fitted with a safety bar or a
hydraulic FOPS-approved safety canopy to
protect the operator. Using the basket boom,
a maximum 28-ft-high by 28-ft-wide (8.5
m) face can be charged from one setup.
Normet points out that a new turntable
design has resulted in a compact boom
structure providing a shorter length in
tramming position and better maneuverability in narrow tunnels. Accordingly, the
Charmec MF 605 D can turn a 90° corner
in 14-ft-wide (4.2-m) tunnels. During
tramming, the basket rests on the rear platform, which protects the basket from collision and damage. With the basket resting
on the platform, there is less load on the
boom cylinders and pins.
Among the many options available is a
compressor that enables self-powered
charging in areas where reticulated air is
not available. An optional enclosed cabin
reduces the noise level to less than 75 dB.
Manual or automatic fire suppression systems, and an automatic lubrication system, are also available.
gate low heading mines with optimum
safety, speed and precision.
“The SV-11 was built in response to a
growing emphasis on mine safety in operations around the world,” said John Howard,
general manager at Oldenburg Mining. “It’s
specifically engineered to improve how operators see and navigate low heading mines,
boosting productivity while putting a keen
emphasis on operator safety and comfort.”
The purpose-built SV-11 scaler features
a slanted design for optimum visibility with
headings as low as 14 ft, and the smallest
minimum heading width in its class at 11
ft 2 in. (3.41 m). A boom extension of 5 ft
10 in. (1.8 m) enables the SV-11 to hit a
maximum scale height of 24 ft 8 in. (7.5
m) and a minimum pick height of 4 ft 1 in.
(1.2 m). At 32 ft 3 in. (9.8 m) long and 6
ft 9.5 in. (2.07 m) wide, it has an inside
Stellar Industries unveiled what it claims is
the industry’s largest truck-mounted OTR
tire manipulator. The TM20165 is capable
of changing the largest OTR tire on the market today, the 59/80R63. The TM20165
can handle tire and rim combinations
weighing up to 20,000 lb (9,100 kg) and
has more than 24 ft (7.3 m) of reach capability. The unit’s capacity rating also allows
it to mount and dismount outside as well as
inside duals without repositioning the tire
manipulator truck. The TM20165 has a
clamping span of 44–165 in. (112–419
cm), with continuous manipulator pad rotation and 315° body rotation. It comes standard with a fully proportional radio remote
control system and also has a low-profile
quad stabilizer package, and a hydraulically
extendable foldover rear stabilizer set that
provides high stability when lifting large
mounted OTR tires.
Badger Equipment’s new CD4415
rough terrain crane is compact—slightly
Safety at a Smaller Scale
U.S.-based Oldenburg Mining unveiled a
small-heading scaler claiming to have the
smallest minimum heading width in its
class, giving operators the ability to navi64 E&MJ • MAY 2013
Badger Equipment’s CD4415 rough-terrain crane has four-wheel drive/steering for high maneuverability.
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UTILITY EQUIPMENT
The Terramac RT9 carrier from Rig Source is shown here outfitted with a dump body. It’s available in both openand closed-cab models.
more than 11 ft (3.35 m) tall—but offers a
number of features including four-wheel
drive/steering for maneuvering in tight
spaces, multiple boom configurations, an
ergonomically engineered two-door cab
with joystick controls and integrated safety
features such as steps and handrails. In
standard configuration, the crane offers a
three-section hydraulic actuated boom
reaching from 24 ft to 62.5 ft (7.3 to 19
m) and boom elevation angle range of
0°–70°. An optional configuration provides
a one-section, 20-ft (6-m) jib giving maximum tip height of 85.5 ft (20 m).
the company, and consequently the RT9
has bolt-on cylinder mounts, front and rear
attachment plates and pivot shaft blocks for
easy replacement. It also features convenient cleanout points to help clear mud and
water from the frame rails.
Core Industrial, based in Alabama,
USA, has served the underground mining,
steel and recycling industries since 2004
by rebuilding, servicing and providing parts
for a wide range of mobile industrial equipment. The company now offers rugged
wheeled vehicles under the Extreme Duty
Vehicles (EDV) label, designed for roughduty utility or personnel-carrier applications. The company’s CoreMax utility vehicle includes a long list of standard external
and internal features for off-road usage,
ranging from special engine and transmission shielding, remote suspension lubrication, and a Lexan windshield; to suspension-equipped seating for driver and front
passenger, stainless steel instrument panel
and convenient handholds and foot braces
for occupants, to name just a few. Optional
equipment includes air conditioning, solidfill tires and a fire suppression system. The
CoreMax is powered by a Cummins
QSB4.5 turbocharged diesel rated at 110
hp, mated to a Dana T20000 power shift
transmission. The vehicle is 204 in. long
with a 144-in. wheelbase, offers more than
12 in. of ground clearance, and weighs
slightly less than 12,000 lb.
EDV’s mining personnel carrier offers
similar features and is equipped with dual
coil over suspension on each wheel.
According to the company, a patent-pending axle mounting system allows it to use
the most durable axles available while freeing customers from maintenance head-
Carriers for All Seasons,
and Surfaces
Illinois, USA-based Rig Source offers the
Terramac RT9 rubber-tracked multipurpose
carrier, featuring 18,000-lb (8,200-kg) carrying capacity, powered by a 230-hp (170kW) Cummins diesel engine, and available
in both open cab and closed cab options.
The unit has rollover protective structure
(ROPS) as well as falling object protective
structure (FOPS) components. The Terramac RT9 is slightly more than 17.5 ft (5.3
m) long, almost 8.5 ft (2.6 m) wide, 9.25 ft
(2.8 m) high and provides 20 in. (500 mm)
of ground clearance. The unit has a 10-ft
turning radius and travel speed is in the
range of 4.7 mph to 7 mph (7.5-11 km/h).
Ground pressure when fully loaded is only
4.9 psi (0.3 bar). Ease of maintenance was
a primary design consideration, according to
66 E&MJ • MAY 2013
Core Industrial’s diesel-powered CoreMax utility vehicle and personnel carrier, shown here, is designed to operate
in rough terrain. Many options are available for customization to meet job requirements.
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UTILITY EQUIPMENT
Prinoth’s Go-Tract line of tracked carriers offers payload capacities up to 46,000 lb (20,865 kg).
aches associated with external braking systems and leaf spring suspensions.
Prinoth AG, based in Italy, builds a comprehensive line of tracked carriers and special-purpose machines. It exhibited its new
68 E&MJ • MAY 2013
Panther T6 carrier at the Prospectors and
Developers Annual Conference held earlier
this year in Toronto, Ontario, Canada.
Prinoth had the T6—the smallest
unit in the Panther line, featuring a pay-
load capacity of 12,000 lb (5,443 kg)—
on display at PDAC fitted with a core drill
to demonstrate how it can be a versatile
and reliable tool in mineral exploration
activities.
The Panther T6 is part of a family that
includes the Go-Tract series of lowground-pressure, tracked vehicles and
Trooper personnel carriers. With a maximum payload of 46,000 lb (20,865 kg),
a Go-Tract can carry drilling rigs up to
171 ft (52 m) in height. Go-Tract vehicles, according to Prinoth, can operate in
the most extreme conditions, including
temperatures as low as 45°C (-49°F) or
as high as 52°C (125°F).
Prinoth also markets the Trooper series
personnel carriers, featuring extremely high
stability and gradeability capacity on both
uphill and side hill terrain. The standard
cabin holds four to five people. An additional six-person cab can be added for larger work crews. The standard cabin is ROPS
(roll-over protective structure) certified and
is climate controlled. Despite a maximum
payload rating of 3,000 lb (1,360 kg), the
Trooper remains lightweight and can be
towed on a trailer by a pickup truck, eliminating the need for tractor-trailers.
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UTILITY EQUIPMENT
On Track, On Balance
Brokk AB, headquartered in Sweden, has
been a leading manufacturer of remotecontrolled carrier-type machines and
attachments for three decades. The company recently introduced its model 100
tool carrier, a tracked unit featuring a
more compact design and 35% greater
breaking power than the model 90.
Although primarily designed for demolition operations, the 100 is a versatile
device adaptable for many uses—including drilling in small stopes. Its low-profile
shape, featuring a three-piece boom
design, is less than 4 ft high and offers a
low center of gravity for stability in many
types of environments. A new load-sensing hydraulic system with improved
hydraulic capacity helps generate superior
breaking power when paired with the
included Atlas Copco SB152 breaker.
Maximum horizontal reach is 12 ft (3.6
m), with vertical reach of 14 ft (4.2 m).
According to Brokk, the new machine is
the first to deliver the flexibility of true
360° working performance, without compromising stability, productivity or reliability. The 100 is powered by a 32-amp, 20hp electric motor and weighs 2,183 lb
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The Brokk model 100 can handle a range of attachments weighing up to 331 lb (150 kg).
(990 kg) excluding attachments. Recommended maximum weight of attachments,
such as breakers or drills, is 331 lb (150
kg). Additional improvements and features
include upgraded cooling capacity, impactresistant steel covers, improved rubber
pads on the outriggers and LED lights with
virtually unbreakable covers.
In addition to the new 100, Brokk
offers eight models, ranging in size from
the 50, at 1,100 lb, up to the 800,
weighing 11 tons. The company also engineers and builds custom machines with
special equipment such as cameras,
extended arms, side-angling devices and
cable drums.
MAY 2013 • E&MJ 69
(Gauging the Value of Water - from p. 46)
be a large user at a local level. Some sites are located in waterscarce locations where mining companies compete with other
water users, including local communities, agriculture and other
industries, while in some locations companies need to manage significant water flows resulting from precipitation or groundwater
sources. Many mining operations recycle significant amounts of
water onsite, and water management, discharge, and use are subject to comprehensive regulatory and legal requirements.
Rio Tinto adopted a water strategy that provides a framework
for managing water and improving business performance across
the social, environmental, and economic aspects of water management. The strategy has three main components: improving performance, accounting for the value of water, and engaging with
others on sustainable water management.
A key focus is to identify ways to minimize the amount of
water removed from the environment, reusing it when possible,
and returning it to the environment while meeting, at a minimum,
regulatory limits.
Rio Tinto has decided to invest in water conservation (for example, by making processes more efficient or using poorer-quality
water in place of potable water) because it understands the value
of water. The company looks beyond the cost of water to take into
account nonmonetary aspects such as social and environmental
values. Rio Tinto has observed that perceptions of value may also
change; for example, communities, governments and business
place great importance on water conservation during droughts.
This concern often quickly diminishes when the drought ends. A
longer-term approach that takes the full value of water into account
would support decision-making on sustainable water use. While
these approaches are still being developed and tested, two of Rio
Tinto’s companies are taking creative approaches to valuing water.
Rio Tinto’s Kennecott Utah Copper operations are located near
Salt Lake City, Utah, where its business has been operating for
110 years. Increasing population and other factors are placing
more pressure on water resources within the region, making sustainable water management critical to Kennecott. Greater than
90% of the water used at Kennecott is characterized as poor-(low)
quality water, and an average of 60% of the water withdrawn is
recycled to minimize importing additional water resources.
The largest water user at Kennecott is the concentrator.
However, more than 90% of the water used at that concentrator is
from recycling. To drive water performance improvements,
Kennecott is developing a water management approach that recognizes that different waters have varied benefits and costs that
support using different waters for different purposes. This water
hierarchy approach recognizes the need to balance a number of
considerations including availability of water and water quality; the
location and type of infrastructure required to transport or treat
water; energy use; and regulatory or legal requirements.
Kennecott’s water hierarchy approach aims to do the following:
• Use poorer-quality water first in operations to minimize the
amount of new, clean water required for use.
• Recycle process water where practicable.
• Separate waters of different quality to optimize water use within the process. Maintain direct involvement and support with the
scientific community in advancing technologies and education
in improving best practices and methodologies.
• Educate the workforce in best water management practices.
For example, when a groundwater source used by the concentrator became unavailable, Kennecott applied the water hierarchy
approach to select a replacement source. Kennecott assessed
several possible alternative sources, including: potable quality
groundwater; surface water suitable for irrigation, and recycled
water sources from its operation. The three replacement sources
each carried distinct costs and benefits. No source was adjacent
to the concentrator, so each source carried transportation infrastructure and operational costs, which differed according to relative proximity.
Although recycling required transportation across 13 miles
compared to 3 miles for potable groundwater, existing infrastruc-
By year end 2011, Resolution Copper had delivered nearly 2 billion gallons of treated underground mine water from the closed Magma mine to the New Magma Irrigation and
Drainage District for crop irrigation. The Resolution copper mine will be one of the largest underground copper mines in the world. (Photo courtesy Resolution Copper Project)
70 E&MJ • MAY 2013
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ture was available for recycling. The need for new infrastructure for
the groundwater and surface water sources increased the “costs”
of these water sources. Additionally, using recycled water preserved potable groundwater to meet existing and future culinary
purposes and saved the surface water for agricultural use.
Capital and operational costs, however, were not the only considerations. Poor water quality can impact metals recovery during
the milling process; therefore process changes were also needed to
limit inhibited metal recovery. Kennecott ultimately replaced the
original groundwater source with the lower quality recycled water.
The decision considered tradeoffs among operational needs, energy requirements, new infrastructure, and the economics of each
option. However, the water hierarchy approach was the primary
guide that led to the decision to use the recycled water source.
The Resolution Copper project is located near Superior, Arizona. The large world-class copper resource lies one or more miles
below the surface where a previous mine had been developed and
later closed in the mid-1990s. A proposed underground mine is
projected to produce more than 1 billion lb of copper per year over
approximately 34 years. A 2011 economic and fiscal impact study
estimated that the total economic impact of the Resolution project on the state of Arizona will be over $61.4 billion.
To begin developing the new mine, more than 2 billion gallons
of water that naturally accumulated in the old mine had to be
removed. Resolution constructed a $20-million water treatment
facility to prepare the water for discharge once it is pumped to the
surface. Initial draining of the old mine took nearly three years to
complete. One of the challenges was determining where the
removed groundwater should go once treated, to ensure the water
is fully used and the environment is not negatively affected.
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Resolution worked with the New Magma Irrigation and
Drainage District (NMIDD) to supply the extracted water for agricultural use in Arizona. The project involved constructing a 44-km
pipeline to transport the water from Resolution’s treatment facility in Superior to Magma Junction. NMIDD will combine this water
with Central Arizona Project (CAP) water for irrigation purposes.
CAP delivers water from the Colorado River by canal to central and
southern Arizona so surface water can be used instead of depleting groundwater for agricultural, municipal, and industrial uses.
In parallel with draining the old mine, Resolution has had to
plan for operational needs of up to 20,000 acre feet (approximately 6.5 billion gallons) per year, principally for the flotation
process used to separate the valuable ore from the waste minerals. While groundwater is the most readily available and least
expensive water source for the mine, the company sought alternative, more sustainable resources. In total, Resolution identified 25
potential sources and ranked them according to social, environmental, and economic criteria.
Resolution identified three sources as future supply options
for water:
• Groundwater that was previously affected by mining: this would
only satisfy about 10% to 20% of the new mine’s ultimate need.
• Banked water with the CAP: Resolution is purchasing and
“banking” excess CAP water with the irrigation districts for
future use, minimizing its impact on water supply.
• Treated municipal wastewater effluent: Resolution is working
with the Science Foundation Arizona, the University of Arizona
and Freeport-McMoRan on technology to use treated municipal
effluent in the flotation process, thereby lessening demand on
other sources, such as groundwater.
MAY 2013 • E&MJ 71
LO A D M E A S U R E M E N T
Designing Superior Weighing Systems
to Improve Safety and Control Costs
What design engineers need to know about measuring weight or force with load cells,
load pins and tension links
By Del Williams
In industries from mining and manufacturing to construction, transportation and agriculture the need to
weigh or measure inputs, outputs, and
applied force has grown in recent
decades to improve production safety
and control costs.
“Design engineers are responding as
complex systems, which may have
lacked weight or force sensing capability in the past, are being upgraded
to include load pins, load cells and
tension cells,” said Riley Phillips, a
mechanical designer at Massload, a
Saskatoon, Canada-based manufacturer of quality weighing systems.
72 E&MJ • MAY 2013
“These sophisticated weight and force
sensing devices can help maximize production load efficiency while offering
some of the enhanced safety features
that are increasingly required by regulation, such as automatic shutdown if a
load exceeds capacity.”
What follows is a quick primer
detailing the vital information design
engineers need to know about measuring weight or force with load cells, load
pins and tension links (also known as
tension cells), and why working and
consulting with the right vendor partner can be a critical choice in the
process.
The Basics
A load cell is a transducer that changes
force into a measureable electrical output. There are many varieties of load
cells, of which strain gauge-based varieties are the most common. Load cells
can range from versatile single-ended
shear beam, which can be used in
weighing applications such as blenders,
hoppers and floor scales, to doubleended shear beam that can be used in
applications such as tank weighing and
large capacity platforms.
“Load pins and tension links are
actually subcategories of load cells,”
said Phillips. “Load pins can be substi-
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tuted anywhere there is a structural pin
and there’s a need to know the shear
force on it. Tension links are a type of
load cell that measures force in tension
applications such as cables, chains and
pulleys. These are often used in lifting,
pulling and winching applications such
as for cranes, line wire tension and man
safety cages in mines.”
Standard load cells and tension
links are typically used if the system is
standard or an engineer can adapt the
system to an off-the-shelf item. This
tends to occur in applications where
there’s some design flexibility in the
early stages of design. Most load cells,
load pins, and tension links are custom
when they must be adapted to fit existing systems. Additionally, designers
should consider the benefits of custom
load cell solutions for new designs
where their use enhances the overall
system integrity, safety or performance.
tation,” said Phillips. “A stress concentration in the CAD modeling may look
artificially high in one area, but may be
masking a stress pattern in another
area. You need accurate data on stress
patterns throughout the component.”
Design engineers would benefit from
asking their weighing system vendor to
validate the output of their load cell
component against simulated real world
conditions. This could be done by simply requesting a digital photo of the test
set up, when possible, for enhanced
accountability.
“The design specifications, loading,
testing and application must be
aligned,” said Heppner. It’s critical to
get accurate CAD modeling and test
data to predict how the product will
perform but it must be backed up by
Avoiding Pitfalls
Planning a weighing system or retrofitting an old one on existing equipment
can present challenges to even veteran
design engineers. Bringing in a weighing
system vendor during the planning stage
can allow design engineers to improve
safety and control costs while meeting
any code requirements.
“There are a lot of issues,” said
Nathan Heppner, mechanical engineering team lead at Massload, which has
refined its standard and custom design
process over the past decade. The important thing is to look at the design process
upfront to maximize reliability and manufacturability while minimizing cost.
“For instance, fit is critical on load
pins because they normally have to
interface with tight tolerances,” said
Phillips. “Depending on where the load
is applied, if the supports, loading area,
pin diameter, or other factors are off,
the load pin may not work as expected.”
To avoid pitfalls, engineers should
insist on a regulatory-approved quality
management system that traces the
load cell manufacture at each critical
step from start to finish. Engineers
should also request a design flow
checklist from any weighing system
vendor to ensure that nothing critical or
even desirable is missed.
“CAD modeling is not always
straightforward, and sometimes you
have to think beyond software’s presenwww.e-mj.com
MAY 2013 • E&MJ 73
A load pin measures the forces on this hoisting system.
actual testing. A mistake as simple as
modeling with the wrong supporting
74 E&MJ • MAY 2013
restraints could artificially strengthen
load pin CAD results. If testing doesn’t
catch it, the component may not perform at its stated capacity.”
To ensure output stability, engineers
also need to know how the load cell output may vary depending on material
strain over time, according to Phillips.
Conducting a creep test to determine
how stable the output is over time can
also be important.
Because the accuracy of any load cell
is only as good as its calibration, it is vital
that the reference cells in any testing system be traceable to a trusted standard
such as that of The National Institute of
Standards and Technology (NIST). To
guarantee that a supplier complies with
the Verified Conformity Assessment
Program (VCAP), a program proposed by
the National Conference on Weights and
Measures, it is also a good idea to ask for
a copy of the VCAP auditor’s report.
“When warranted, it’s advisable for a
vendor to cross check their results
against an independent, third-party engineering firm as an added layer of reliability and quality assurance,” said Phillips,
whose company sometimes does this for
more complex components or situations
to ‘bulletproof’ the end product.
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The right vendor partner will also
pay attention to small details that will
streamline manufacture of the weigh
system component, according to
Phillips, such as bonding, grounding,
sealing, and gauge selection to ensure
lasting performance and resistance to
water intrusion.
Phillips points to the importance of
knowing the correct location where load
cells, load pins, or tension links are
supported “because if you over-support
a load cell it won’t have the output
you’d expect.” Placement of internal
electronic components such as bondable or trimmable resisters can also
affect device performance, he said.
Details such as the types of bolts
used should not be overlooked. “The
customer may require a countersunk
bolt arrangement to hold lids on, if during operation bolt heads could be
sheared off because they’re close to
walls or equipment.”
“Even details such as putting scribe
lines on where to place components can
ease manufacturing,” said Phillips.
“When these sorts of details are overlooked, they can require the manufac-
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turer to rebuild a load pin or load cell
before it’s done right.”
According to Phillips, the right
weigh system vendor partner will also
consider finer points that will affect
field performance and maintenance.
“It’s important to include loading
direction arrows because once a product
like a load pin is sealed and symmetrical,
the customer won’t know which way to
place it in their equipment otherwise,”
said Phillips. To enhance field performance, it’s also necessary to specify the
right type of connector, whether hard
wired, wireless, or quick disconnect.”
As design engineers respond to the
growing need to weigh or measure
inputs, outputs, and applied force to
improve production safety and control
costs, working and consulting with the
right vendor partner can be a critical
choice in designing weigh systems with
the optimum load cells, load pins, or
tension links.
Williams is a technical writer based in
Torrance, California. For more information
about Massload’s services, please visit
www.massload.com.
Shear pins measure tension loads.
MAY 2013 • E&MJ 75
O P E R AT I N G S T R AT E G I E S
Gold Mines and Gravestones
How one mining company found the answer to an intractable problem
When an African gold mining operation ran
up against unusual rock formations that,
according to local rumors, might be human
graves, a religious ruling forced expansion
plans to be put on hold. However, Wardell
Armstrong International devised an
approach to help resolve the problem with
a unique combination of geological, geoforensic and legal expertise. The U.K.headquartered company is a well-known
independent engineering consultancy specializing in mineral resource development
and management.
Planned expansions to existing mines
have to be undertaken with the same level of
care as the original development. The environmental impacts of noise and dust caused
by construction and the potential effects on
water and soil all need to be considered
carefully—as do social and cultural issues
and their impact on local communities.
Tailings dams in particular need
detailed design and planning to ensure
they meet best international practice. But
one thing that planners may not expect to
encounter is anthropogenic features on the
ground surface that might be human
graves. This was the situation faced by a
mining company operating in the Sahara
Desert when they planned to build additional dams for cyanide tailings needed for
their rapidly expanding gold production. At
the end of 2008 they hit a major problem.
Six unusual rock formations that could
have been nomadic graves were discovered
by workers within the area of the mine.
Sensitive to local customs and traditions, the mining company asked Christine
Blackmore, principal environmental geologist at Wardell Armstrong International, to
offer an opinion, as Blackmore was carrying out geotechnical and environmental
work for the mining company at the time.
Her initial assessment indicated that some
of the rock formations might prove to be
graves as rumored by the local nomadic
mine workers, who were concerned that the
sites might not be respected.
“There were strong grounds for believing that at least some of the unusual rock
formations were genuine nomadic human
graves,” said Blackmore. “Several had the
distinctive headstone and footstone, and
were clearly orientated toward Mecca.”
98 E&MJ • MAY 2013
A Wardell Armstrong mining client had to proceed cautiously when enigmatic stone arrangements similar to these were
discovered in an area marked for expanded tailings storage. Some were determined to be nomadic-tribe grave markers.
The mining company faced a quandary:
It wanted to maintain the trust of their
workforce and neighbors by respecting
local families and traditions, while advancing their mining program and building new
tailings facilities—without which, production would stop. They made a request to
proceed at national government level,
which was rejected by the Ministry of
Religious Affairs.
In 2010, they turned again to Wardell
Armstrong International for advice, even
though it seemed unlikely that the religious
ruling could be overturned or changed. But
something else had changed in the meantime. Additional piles of stones had been
discovered, possibly prompted by offers of
compensation by the mining company.
Now there were 30 sites that needed to be
investigated—not just the original six.
“It was clearly important to treat all 30
rock formations with the same degree of
care and respect, so we made some logical
first steps,” said Blackmore. “These included a site survey to plot all 30 sites, a
photographic record for each and a study
of their formation and orientation. This was
supported by a petrographic assessment of
the area—looking at the rock strata where
the formations were found in order to
gauge whether the rocks that had been
used were local or had been imported.”
A conceptual geological model for the
graves was developed by Dr. Laurance
Donnelly, a forensic geologist at Wardell
Armstrong, who is experienced in similar
searches for graves and burial artifacts.
This showed primarily a variable amount of
silt, sand and gravel, which may have been
deposited by a combination of geomorpho-
logical processes including aeolian, fluvial
or colluvial desert processes. These covered bedrock comprising fractured igneous
and metamorphic granitic rocks. The depth
of the superficial cover was not known.
The area had for centuries been a fertile
wadi and a busy camel-trading post regularly used by nomads. From talking to local
people and elders, it appeared likely that
any genuine nomadic graves would pre-date
the copper and gold mining operations. In
the 1960s, a smallpox epidemic had caused
many deaths. The shallow graves dug at that
time would have been made with hand tools
and in reasonably soft ground. This knowledge also provided some useful early clues
as to which of the 30 piles might be genuine
sites of human remains.
The conceptual geological model
enabled a methodology to be developed for
each grave. There were basically three
options under consideration by the mining
company: an exhumation of each location,
the development of a full geoforensic
search strategy by Wardell Armstrong, or a
legal approach.
A direct invasive investigation and
exhumation would clearly be the simplest
and most obvious option, using a combination of probing or trenching techniques to
determine the presence of any human
remains such as skeletonized bone, mummified human remains, clothing and other
associated objects or items. It would be
critical, however, to conduct these procedures in compliance with Islamic laws and
cultural traditions.
The forensic geology option would
involve the geological and geomorphological mapping of the alleged grave locations,
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sampling the soils and conducting an
analysis of the volatile organic compounds,
the design and deployment of a geophysical survey and the possible deployment of
specially trained cadaver dogs. Any positive indications or anomalies would then
need to be verified by probing, trenching or
digging. Although this option would deliver
a high assurance search, it was relatively
more expensive, time consuming and
would clearly disturb the graves.
The third option—involving the assessment of legal, religious and cultural issues
relevant to the removal of any human remains—was the one chosen to be taken as
the first step. For this, Wardell Armstrong
called on the highly specialized services of
Professor Mohamed El-Hacen ould Lebatt,
a professor of Islamic law and a specialist
in Islamic culture and traditions.
Professor Lebatt subsequently looked
into Islamic law and holy scriptures. He
also visited scholars and Erudites who had
been involved in similar cases and rulings
in a number of African countries. He
found that in certain limited circumstances involving public interest it can be
permissible to remove graves. He was also
able to determine that it was culturally
possible to move a grave since the body
belongs to Allah after death, rather than to
the family of the person who has died.
These findings proved to be decisive in
changing the governmental ruling, which
had earlier stood in the way of allowing the
mining company to proceed with the construction of new tailings dams. There was
a clear interest in this for the local Islamic
people, since it would enable several hundred to keep their jobs.
With the government ruling changed, a
committee was formed to visit all 30 sites
and make a determination about each of
them. It was made up of seven dignitaries
including local Hakim and Wāli elders, a
scholar, a local Erudite, a representative
from the mining company and a local
national of Islamic faith from Wardell
Armstrong. The committee agreed that six
of the unusual rock piles should be investigated further by exhumation. On the day
of the exhumation, four of the sites were
found to be graves containing the remains
of bodies. Two bodies were carefully
removed under the supervision of the committee, placed in coffins and transported
to a local cemetery where they were
reburied with all due reverence. It was
agreed that the remaining two could
remain in place in undisturbed ground
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with earth bunds around them, safe from
expansion activities.
This case highlighted the complexity of
issues in which technical and cultural
affairs overlap. Although it took time,
patience, multi-disciplinary study and a
great deal of expertise to resolve, the outcome proved to be satisfactory for all the
parties involved. Islamic law was consulted
and followed with attention to correct protocol. The families of those who had been
buried at least 50 years earlier saw the
remains of their ancestors treated with
respect and dignity. The mining company
was able to continue with the construction
of new tailings dams and expand its gold
mining operations, securing the livelihoods
of many local people. The legal case has
also created a significant milestone in
Islamic law, and identified one acceptable
way forward for mining companies facing
similar situations in other countries.
MAY 2013 • E&MJ 99
Mining Industry Embraces Technology as Skilled
Workforce Diminishes, According to BDO Study
International mining executives are bracing
for the negative impact the lack of a skilled
workforce will have on their organizations,
according to new research published by
BDO, an international network of accounting firms. Of the mining executives surveyed, 79% feel the lack of a skilled workforce will have a negative impact on their
business this year. While environmental
policy tops executives’ domestic regulatory
concerns, with 34% citing it as a potential
issue in the year ahead, labor and employment issues are a close second, with 30%
of executives noting it as a major concern.
The survey, part of BDO’s 2013 International Resources Study, sought insight
on regulatory affairs, employment and the
environment from 130 C-Level and senior
financial executives at mining companies
in the United States, South Africa, United
Kingdom, Australia and Canada.
While executives around the globe grapple with labor and employment issues,
63% of South African executives note this
is their primary concern—twice the survey
100 E&MJ • MAY 2013
average—due in large part to high regional
unemployment rates and sustained labor
unrest driven by working conditions related
to wages and social issues.
Mining executives are facing labor shortages head-on with technology. The industry
has an opportunity to be at the forefront of
innovation, improving both production and
prospecting with new technologies that will
increase efficiency and produce greater
returns. In fact, 50% of executives believe
that substituting technology for labor will
have a positive impact on their business in
2013, creating a new intersection in the
industry of old and new techniques.
“We are in the midst of a transition in the
mining industry from a blue collar to a white
collar workforce,” said Charles Dewhurst,
Global National Resources leader, Natural
Resources industry group at BDO. “With
advancements in technology from new software that makes prospecting easier, to
advancements in mineral transportation, the
industry is at a critical juncture. Technology,
and the individuals who are skilled in devel-
oping and utilizing these tools, is now more
important than ever as demands for greater
returns and increased productivity are forcing the industry to innovate.”
Despite their broader concerns surrounding labor and employment, 42% of mining
executives believe their total number of
employees in 2013 will remain about the
same, and 38% feel the size of their workforce will increase throughout the year.
While 34% of international mining
executives are concerned about domestic
environmental policies, where they will
direct their resources to address these concerns varies. Water pollution, including
acid mine drainage and runoff, is the most
funded environmental initiative at 48%.
Australia bucks this trend, with only a
quarter of its executives citing it as a major
project (25%). Instead, 38% of Australian
executives indicate that they are focused
on ecosystem disruption, the second most
prominent area of funding globally (23%).
CO2 emissions round out the top three
environmental concerns for mining execu-
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tives, with one in five citing it as a major
issue. In fact, South Africa recently began
discussions on taxing carbon emissions,
potentially making it one of the largest
sources of tax revenue in the country.
Other key findings from the survey
include:
• Corporate social responsibility programs
focus on employees, local communities.
Forty-six percent of mining executives
surveyed say their corporate social
responsibility plans invest most heavily
in employee health and safety programs.
Community outreach (30%) and environmental stewardship (18%) rank second
and third among investment areas for
the industry.
• The United Kingdom cites anti-bribery/
corruption legislation as a top domestic
regulatory concern. Of executives surveyed in the U.K., 23% cite this legislation as a worry—triple the survey average
of 7%. This reflects the fact that the
U.K. implemented strict new anti-bribery
laws with extra-territorial reach in late
2010. With much of the U.K.’s is mining
operations occurring beyond its borders,
executives are closely monitoring regulatory developments that may impact the
way they do business.
• Resource nationalism impacting mining
companies around the globe. Of executives surveyed, 61% note that resource
nationalism will have an impact on their
businesses in 2013. Their concern also
extends to tax imposition and increases:
67% anticipate an impact on their business this year as Australia’s Super Tax
takes shape and countries like South
Africa plan for similar tax burdens.
Natural Resources Executives’ Top
Environmental Concerns.
Natural Resource Executives’ Preferred
Strategy to Improve Profitability.
102 E&MJ • MAY 2013
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SUPPLIERS REPORT
ABB to Deliver Hoist Systems to
Russian, Canadian Potash Sites
ABB reported in April that it had won two
major hoist-delivery contracts for large
potash operations in Russia and Canada.
ABB said it will provide 12 mine
hoists—nine double and three single drum
systems—as well as related shaft equipment to Uralkali, one of the world’s largest
potash producers. The hoist systems will
be installed at Solikams and Polovodova in
the Perm region of Russia.
ABB’s delivery package includes the
mechanical hoists, skips, cages, four feeding
conveyors for loading the skip hoists, and
electrical equipment such as medium and
low voltage drives, control system and shaft
signal system. The deliveries are scheduled
to take place between 2014 and 2018.
Installation of the new hoists, said ABB,
will reduce energy consumption per ton by
up to 30% compared with the performance
of the older hoists that will be replaced.
ABB had previously installed two mine
hoists for the company, and the customer’s
experience with those systems contributed
to selection of ABB for the recent order, said
the Baden, Switzerland-based company.
ABB also reported it had been selected
by BHP Billiton to supply mine hoisting
systems for the Jansen potash project,
located 130 km east of Saskatoon, in the
province of Saskatchewan, Canada.
The contract includes the overall
design, manufacturing, supply and instal-
lation of four complete mine hoist systems
to be delivered between 2015 and 2018.
This includes mechanical components as
well as the electrical systems including
ACS6000 AC drive systems and the highpower, low-speed synchronous motors.
According to ABB, the 6-m-diameter friction hoists to be supplied for the production
shaft will be the largest mine hoists ever
designed and manufactured, each with a total
connected motor power of almost 14,000
kW. Nearly as impressive are the service shaft
hoists, which are electrically identical to the
production hoists but will carry smaller payloads. The company said the complexity and
ultra-high performance requirements of the
brake systems on these massive hoisting systems required the development of new mine
hoist brake system technology.
“BHP Billiton and ABB agreed to jointly
develop a project safety plan that meets the
high safety standards required by both companies,” said Gabe Azeroual, vice president
of ABB Process Automation in Canada.
Once the four hoisting systems at the
BHP Billiton Jansen mine are installed,
ABB will have an installed base of 11 friction hoisting systems in Saskatchewan
alone. Overall, ABB said it has supplied
more than 700 mine hoist and automation
projects and more than 100 stand-alone
hoist brake system projects in more than
30 countries worldwide.
These 4.88-m double drum hoists installed by ABB at Impala Platinum are similar to those the company will deliver to Russian potash producer Uralkali.
106 E&MJ • MAY 2013
Wenco to Install Systems at
Koniambo and Damtshaa
Wenco International Mining Systems
recently announced it had won a contract
to supply Fleet Management Systems to
the Koniambo mining project in New
Caledonia and Debswana’s Damtshaa diamond mine in northeastern Botswana.
A joint venture of Xstrata Nickel and the
Société Minière du Sud Pacifique (SMSP)
is managing development of the Koniambo
project. The mine covers approximately
745 hectares, has an expected annual
nickel production of 60,000 mt, and a projected life of 50 years.
Wenco said its technology will be
installed on nine shovels and 44 trucks at
the mine site over the next two years.
Situated atop a coastal mountain range,
the Koniambo mine has rugged terrain, a
complex geology and very specific blending
requirements. Koniambo will use Wenco’s
BenchManager high precision GNSS systems on its shovels to further optimize the
mining operations, and the Wenco system
will interface with a custom software package to ensure the most up-to-date grade
and quality information is used by the dispatching algorithms.
Koniambo also will employ Wenco’s
Mobile Supervisor Terminal technology, providing supervisors in the field with real-time
data and the ability to control operations
from their vehicle.
Construction of the main processing
facilities has been completed and production at Koniambo mine is slated to begin
in 2013.
The Damtshaa mine is a joint venture
between De Beers Corp. and the Government of Botswana. Damtshaa opened in
2003 and is expected to produce 5 million
carats of diamonds from 39 million metric
tons of ore over its projected 31-year life.
“The Wenco system is currently utilized
at the larger Orapa and Lethakane operations and the Debswana management team
saw the value of bringing the system to the
smaller Damtshaa mine,” said Wenco
Regional Director Jayson Bebek. “This will
allow consistent operational methodology
for all of their mines in the region and they
can take advantage of the same real-time
tools and reporting.”
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SUPPLIERS REPORT
Installation is expected to be completed within the first half of 2013 and will
involve nine vehicles at the mine.
Firms Seek Improved Driver
Safety—on and off the Site
Utah, U.S.-based inthinc Technology Solutions, a provider of telematics, fleet management and driver safety products,
announced recently that drilling equipment
and services company Boart Longyear had
selected inthinc’s waySmart solution to support the company’s fleet safety initiative.
waySmart, according to inthinc, allows
Boart Longyear to track fuel usage, view
GPS-based trip details and provide its drivers with real-time, in-cab verbal coaching
and alerts for speeding, seat belt use, excessive idling and aggressive driving behaviors.
Boart Longyear selected waySmart following a pilot project conducted at multiple
Boart Longyear sites. After seeing significant improvements in driver safety—including a 92% reduction in speeding, 88%
reduction in aggressive driving events, and
76% increase in seatbelt use, according to
inthinc—Boart Longyear decided to deploy
waySmart throughout its Europe, Middle
East and Africa operations.
With the system in place, Boart
Longyear will have real-time insight into
fleet activity and performance through a
Web portal. Using integrated GPS tracking
and telematics capabilities, fleet managers
can see, for example, where each vehicle is
located, where drivers stopped, the duration of the stop, and how long it takes each
driver to get from one location to another
throughout the entire route. This allows
Boart Longyear to respond quickly to any
emergencies and communicate any potential delays to customer sites in a timely
manner. The portal also shows any safety
alerts during the route such as speeding,
hard braking or other risky driving behavior.
According to inthinc, waySmart is wellsuited for global mining or drilling corporations because of its Iridium-based satellite
communications connectivity, available for
workers in remote areas. inthinc technology also allows these companies to create smartZones—customized geo-fences—
around mining sites, blast zones or drill
rigs alerting drivers when they approach a
hazardous area.
“Global organizations like Boart Longyear
need a solution that fits the unique needs of
their industry in terms of fleet accessibility
and driver performance,” said Skip Kinford,
executive vice president, inthinc.
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Earlier this year, Tucson, Arizona, U.S.based Guardvant said it had capped off
significant sales growth in 2012 with several orders awarded by Codelco (Corporación Nacional del Cobre de Chile) for operator fatigue and alertness monitoring systems and proximity awareness systems.
According to the company, more than 500
of its OpGuard and ProxGuard systems will
be in operation once installation is completed at two Codelco mines in Chile. The
Codelco orders will add to Guardvant’s
global install base in Africa, South
America, North America and Australia.
Guardvant said it also will implement its
Mobile Server (GMS) as part of the Codelco
projects. GMS allows multiple on-board
applications to run on a common hardware
platform. Guardvant’s development of GMS
has been driven by customers’ desire to
reduce the in-cab clutter of multiple monitors
and hardware needed to run various systems.
Guardvant’s OpGuard and ProxGuard
systems monitor operator behavior for signs
MAY 2013 • E&MJ 107
SUPPLIERS REPORT
of fatigue and distraction and improve
equipment operator’s visibility to see
objects in blind spots. The systems are
designed to alert the operator and supervisor before an accident occurs.
Flowserve Receives Valve
Order for Hydromet Plant
Flowserve Corp. has received orders totaling more than $9 million for a range of
valves installed in a new nickel ore processing facility located in Long Harbour,
Newfoundland, Canada.
At Long Harbour, Vale NL is constructing a large plant to process nickel-cobaltcopper concentrate using an innovative
hydrometallurgical process. The plant is an
integral part of the company’s Voisey’s Bay
project development, which also includes a
mine and concentrator in Labrador, as well
as the Long Harbour facilities.
In the hydromet process developed by
Vale for sulphide concentrate, a finely
ground nickel-cobalt-copper concentrate
will be processed in a pressurized vessel
where it will react with oxygen and sulphuric acid to produce an impure solution
of nickel, cobalt and copper. This solution
will pass through a number of chemical
purification steps ending with removal of
108 E&MJ • MAY 2013
A nighttime view of Vale’s $2.8-billion Long Harbour, Newfoundland, nickel hydrometallurgical plant.
impurities and separation of nickel, copper
and cobalt. The copper and cobalt will be
recovered as by-products. The nickel will
be recovered by electrolysis as high-quality
electronickel product suitable for market.
The waste solids from the process will be
neutralized with lime and will be deposited
in a specially designed disposal facility.
Vale expects the $2.8-billion Long
Harbour plant to begin production by the
end of this year. Interestingly, it will not
initially process Voisey’s Bay material;
instead, the company will process nickel
feed sourced from Indonesia in the early
stages of plant startup because that ore
has less impurities. It anticipates transitioning to Voisey’s Bay ore in 2014.
Booked in 2012, the Flowserve products included in the Long Harbour order
include Worcester 44 series ball valves,
Durco T4E lined plug valves, Atomac lined
ball valves and McCanna top-entry ball
valves. In addition, Flowserve provided a
number of valves with customized designs
and specialized materials.
South African Conveyor
Training Program
A recent report from South Africa’s Conveyor Manufacturers Association (CMA)
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SUPPLIERS REPORT
said the organization, recognizing a lack of
suitably trained conveyor and belting technicians and engineers in that country, has
placed increasing emphasis on providing
skills training and education to the materials handling industry by offering a number
of workshops and courses to remedy the
situation. These include a six-day diploma
course on the design and operation of belt
conveyors; the CMA Beltsman certificate
course; the CMA conveyor certificate
course; the conveyor belt splicing certificate course; and an intensive belt splicing
accreditation course, all running from one
to five days each.
According to CMA, the effect that these
courses have had on the South African
conveyor industry has drawn international
attention, with a Turkish mine being the
first foreign operator to request the CMA
run training courses at its site. A second
request has been received from Botswana
for training later this year.
Kişladağ is part of the Tüprag Group,
owned by Canada-based Eldorado Gold,
which has interests in Turkey, China, Greece,
Brazil and Romania. It is situated in an isolated area of Uşak Province in western Turkey, and is expected to become the largest
gold mine in Turkey in the near future.
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Eldorado Gold’s Kişladağ mine, shown here, relies on a complex conveyor system. It recently arranged for its employees to receive conveyor operation and maintenance training from personnel provided by South Africa’s Conveyor Manufacturers Association.
The mine is an open-pit operation producing low-grade bulk tonnage and using
heap leaching for gold recovery. It has
undergone constant expansion since 2003,
and recently added considerable capacity
to the crushing and conveying circuits.
The mining and beneficiation process
relies heavily on a complex conveyor system, with minimal downtime a high priority. It was essential that all personnel involved with the conveyors and ancillary systems be adequately trained. Alan Exton,
CMA member and conveying engineer, presented two three-day CMA conveyor certificate courses and two one-day CMA Beltsman’s certificate courses over a period of
eight working days at the end of 2012 in
Turkey. A total of 52 students participated.
Training notes for the students were
translated into Turkish after a confidentiality agreement with the mine had been
signed. For some courses, a great deal of
interpretation was necessary as many students had no command of the English language; consequently, the mine’s material
control engineer, Erkan Annak, was appointed as interpreter and translator and worked
closely with Exton to facilitate the transfer
of information. According to CMA, training
results were excellent, with a 100% pass
rate for the three-day course and an 84%
pass rate for the one-day course.
MAY 2013 • E&MJ 109
P R O C E S S I N G S O LU T I O N S
Comparing the Cost of Dust Collector Bags
vs. Cartridge Filters for Mining Applications
By David Stock
Cartridge dust collection system used for a fine ore crushing application.
There are two primary types of dry dust
collection systems used to control dust at
mine sites, mill transfer points and similar locations: baghouse collectors that use
rows of large filter bags and cartridgestyle collectors that use much smaller
pleated filter elements. Though baghouses have been the traditional choice, cartridge collectors have gained popularity
over the past decade because they offer
several advantages over baghouses.
A cartridge collector has a much
smaller footprint than a conventional
(i.e., nonpleated) baghouse and operates
at lower pressure drop. It can also
achieve significantly higher filtration efficiencies—a potentially important advantage since, if emissions are too high, regulators may curtail production.
An important difference between baghouses and cartridge collectors is filter
cost. There are many factors beyond initial price that must be considered in formulating a true cost comparison between
the two types of filters. By understanding
how to make that evaluation, mining
engineers and mine managers looking to
upgrade dust collection equipment will
110 E&MJ • MAY 2013
be in a better position to make informed
equipment buying decisions.
The first step in a bag vs. cartridge
comparison is to match filters by air flow
or cubic feet per minute (cfm) of through
the system. It is important to base the
comparison on cfm and not on the cost of
an individual bag vs. an individual cartridge. Why? Because it typically takes
somewhere between eight and 20 bags to
achieve the same cfm as a single cartridge. The exact number will depend on
the length and diameter of the bag.
Another consideration is how much
time it will take to replace the filters. In
some mining processes, the government
has imposed regulations through permitting which state that any time a dust col-
lector is shut down, the process that the
dust collector serves shall be shut down
concurrently.
Also, to make an evaluation, we need
to consider the production run rate at
the time of the filter change-out; the
average head grade of the mining ore;
the selling cost of the product at the
time of the downtime; and the cost to
produce 1 lb (or in some instances, 1 oz)
of the product.
As an example, a large mining company was looking at upgrading the dust
collector used to serve a fine ore crushing and screening plant. The existing
equipment was a 47,000-cfm baghouse.
The following analysis compares the
change-out costs for the existing filter
bags with projected costs for the same
application substituting high efficiency
cartridge filters.
The existing bags were 5.75 in. in
diameter by 10 ft in length with a polyester filter media with efficiencies ranging
from 99% to 99.9% on particles larger
than 1 to 3 microns. Typically, small particles below this size range are not effectively captured with bag filters. The cartridges used in the comparison were highefficiency pleated filters with an openpleat design that allows better utilization
of the media surface for longer filter life
and more energy-efficient performance.
The cartridge filter media is pleated moisture resistant paper with a maximum of
seven pleats per inch and a double gasket
for leak protection. The filters are vertically mounted and do not require an
external wire or expanded metal cage. The
cartridge filters are 99.99% efficiency on
0.5 micron or larger particles by weight,
and are guaranteed to produce collector
Figure 1: Bag vs. cartridge cost comparison for a 47,000-cfm dust collector.
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Figure 2: Costs of one hour lost production.
outlet emissions of 0.005 g/ft3 or less.
The air to cloth ratio on the dust collectors is below 2:1.
The 47,000-cfm dust collector used
544 bags, while a cartridge collector
serving the same process would only
require 72 cartridges as shown in Figure
1. At the time of this evaluation, the cost
per bag was $32, compared to an individual cartridge cost of $234. The total
cost of filtration using bags is therefore
$17,408 (544 x $32), in comparison to
total cartridge cost of $16,848 (72 x
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Figure 3: Filter change-out downtime cost comparison.
$234). That amounts to a savings of
$560 in initial filter cost—while achieving significantly higher filtration efficiency with the cartridges as an added bonus.
Even more important in this evaluation is that mine maintenance personnel
had to schedule two 10-hour “down”
days to replace the 544 bags inside the
unit, or 20 hours of lost production. With
a cartridge dust collector sized for the
same cfm, change-out of the 72 cartridges would only take an estimated four
hours, recouping 80% of the lost production time.
MAY 2013 • E&MJ 111
The costs of one hour of lost production are shown in Figure 2. If the potential production run rate is 3,500 dry tons
per hour (dtph), the average head grade
of the ore is 0.45%/ton, and the ultimate
recovery of the product is 80%, the mine
would lose 25,200 lb of copper. If copper is selling on the market for $3.65/lb
and the production cost to produce 1 lb
of copper is $2.50, the lost revenue due
to that shutdown would be $28,980.
As mentioned previously, change-out
of the baghouse filters required two 10hour down days or 20 hours of lost production. Applying the hourly cost parameters from Figure 2, over 20 hours the
mine would lose 504,000 lb of copper,
equaling $579,600 in lost revenue during bag filter changeout compared to only
four hours of downtime with cartridge filters, totaling a loss of 100,800 lb of copper for $115,920 in lost revenue (See
High efficiency cartridge filter.
Figure 3). There is a difference of
$463,680 between changing out bags
and cartridges when factoring in the
costs of lost production.
Energy cost is another important area
of concern. The next step in the analysis
is to compare the operating horsepower
requirements of the 47,000-cfm baghouse with a 47,000-cfm cartridge collector. This analysis is based on a local
utility rate of $0.8/kWh and an operating
schedule of 24 hours a day, 313 days
out of the year or 7,512 hours (allowing
for scheduled downtime). The results
can be found in Figure 4. The existing
baghouse used a 200-hp motor, resulting in an annual operating cost of
$89,663.23/year. In comparison, the
cartridge collector could run with a 150hp motor for the same 47,000 cfm, at
an annual cost of $67,247.42. That’s a
difference of $22,415.81/year in savings on electrical costs.
In some areas of the world where it is
difficult to get electrical power to a mine
site, there may be another important benefit of using cartridge filtration. The
resulting savings in horsepower and electrical consumption might allow a mine to
Bag filters for mining applications.
112 E&MJ • MAY 2013
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The total annual savings (downtime
plus electrical) achieved by using cartridges in place of bags amount to
$486,096—a significant difference.
Adding in the initial filter cost differential of $560, the grand total comes to
$486,656 saved with cartridge filters.
It is not the cost of one bag vs. one
cartridge that matters when evaluating
dust collector filter costs: It is all of the
other factors that come into play during
dust collector operation and change-out.
One could take the exercise even further
by analyzing savings in manpower costs
and filter shipping, storage and disposal
costs. Whatever factors one chooses to
evaluate, a dust collection supplier can
help you use this data to compare the
real costs of operating baghouse and cartridge dust collectors. It will prove well
worth the time it takes to prepare a cost
analysis that can save time, money and
energy for years to come.
Figure 4: Energy cost and savings comparison for a 47,000-cfm baghouse and cartridge motor.
install another piece of processing equipment, e.g. a larger crusher or additional
crusher or screen, depending on the
www.e-mj.com
number of dust collectors used and total
horsepower saved. This in turn may generate more revenue for the company.
David Stock is mining market manager for
Camfil Air Pollution Control. For more
information, call 800-479-6801 or 870933-8048; Email: [email protected];
Web: www.camfilapc.com/mining.
MAY 2013 • E&MJ 113
E Q U I P M E N T G A L L E RY
Coring Rig Monitors Itself for
Efficiency and Safety
Boart Longyear has released its next generation exploration drill, the LF120A surface coring rig. The semi-automated rig
features a hands-free operating system
and self-monitoring technology, with critical information displayed on a large LCD
screen that leads operators through startup, drilling and troubleshooting procedures. According to the company, common mistakes are avoided when the system alerts operators whenever defined
parameters are exceeded. The LF120A
also features a “hands-free” rod handling
system comprising a rod handler, an autoadjusting breakout tool an innovative hoist
plug spinner, and a wireless remote that
allows the operator to control the process
from a safe position. The rod handler provides 270° pick-up capability, 2-m height
adjustment, 180° rollover and 100°
slew—a level of flexibility that allows the
handler to access the rod supply regardless of where rods are located around the
drill. The LF120A also introduces an
open-face mast design, which encloses
rotating parts and applies unified guarding
at the operator’s level. Rig depth capacity
is 1,200 m NQ with a pullback capacity of
16,000 kg (35,872 lb) and a hoist capac114 E&MJ • MAY 2013
ity of 9,071 kg (20,000 lb). The rig can
be jack, skid, truck or crawler mounted to
match the portability needs of the user.
www.boartlongyear.com
Production Management
Software Update
GEOVIA has released the latest version of
InSite mine production management and
reconciliation software. InSite 4.3, according to the company, provides users with
more operational visibility through new and
improved tools for data analysis and
advanced tools to reconcile production outputs and activities against what was
planned. Identifying variances and the
causes behind them is now made easier
with a new Variance Analysis module;
future variances can be reduced by providing the justification required to update
models, plans and schedules. Users will
also benefit from the ability to see production activities as they happen, to ensure
they are performing efficiently at all times.
Users may quickly drill down into the different recorded details of an activity to
investigate the impact of compounding
variance on different contributors such as
employees, equipment, material types and
others. Activity information in InSite coming from real-time-data integration from
external applications such as fleet management, or InSite’s Data Entry module,
can be monitored as soon as data is captured by the system. GEMS users who
import vector maps into InSite’s Central
Monitoring module now have automated
functionality for location allocation.
www.3ds.com/products/geovia
Excavator is Stronger and
more Fuel Efficient
Hyundai Construction Equipment Americas’ newest crawler excavator, the
R260LC-9A, offers a certified Interim Tier
4 engine upgrade, improved hydraulics,
increased operator comfort and more durability, according to the company. The
R260LC-9A, part of Hyundai’s new line of
9A series excavators, has an operating
weight of 56,880 lb, a bucket digging
www.e-mj.com
force of 38,290 lb/ft and maximum digdepth of more than 22 ft. The 178-hp
Cummins QSB6.7 engine powering the
R260LC-9A features the Cummins Direct
Flow air filter, and the new model carries
other innovations such as variable speed
fan clutch, two-stage auto decel system,
and a new economy mode to conserve
fuel and reduce environmental impact.
Operators can choose between three
engine modes—power, standard and economy—which enable the machine to switch
between full power and reduced fuel consumption according to the user’s preference. Hyundai says it has improved the
structure strength of the 9A series cabs
with stronger, slimmer tubing for optimum
safety and visibility. High-strength steel
forms a more durable upper and lower
frame. In addition, the enlarged cab comes
with a see-through upper skylight; a larger
one-piece right-side glass; safety glass windows on all sides that won’t scratch or
fade; a closeable sunshade; and a reduced
front window seam—features that work
together to improve visibility.
www.hcamericas.com
ity. It comes standard with a high-definition, 14-in. LCD display and can be configured with either an Intel Core i5-3360M
or Core i7-3520M processor. It also offers
a choice of mobile Intel Express chipsets,
either of which provides integrated USB
3.0 protocol on a single-chip architecture.
Wireless connectivity options include an
Tough, Versatile Notebook
Computer
GammaTech Computer Corp. is set to introduce the model SA14 Durabook rugged
notebook, offering a choice of Intel Core
processors, battery life of up to 11 hours,
and flexible options for wireless connectivwww.e-mj.com
MAY 2013 • E&MJ 115
integrated Bluetooth 4.0 and WiFi Link 6235 series combo, as
well as Intel mini-express Wireless LAN 802.1. Other options
include GPS support and WWAN module. The SA14 comes standard with a 9-cell lithium ion Smart Battery pack. When combined
with the optional 6-cell battery pack, the unit can function for up
to 11 hours. It offers security features such as TPM 1.2 data security technology, a Kensington lock connector, Computrace asset
management and data protection, and a fingerprint scanner. A
SmartCard reader is also available. The non-glare HD LCD display
has an optional touch panel and a sunlight-readable touch panel
with high-brightness enhancement.
www.GammaTechUSA.com
Flowmeter Family Expands
to Include DP Technology
ABB Measurement Products’ business has extended its line of compact flowmeters to include four DP technologies: orifice, wedge,
averaging pitot and integral orifice. The FPD500 OriMaster has now
been extended in size range to cover pipe sizes from ½ in. to 12 in.
NB (15 to 300 mm). The new FPD550 PitoMaster brings the Torbar
averaging pitot tube into the compact DP family, offering simple
one-hole installation in many cases, making its use in existing
pipework both simple and low-cost. The FPD570 WedgeMaster is
an updated compact Wedge flowmeter for pipe lines from 1 in. to
6 in. NB (25 to 150 mm). The FPD510 IOMaster is suited for low
flowrates in small pipelines. Compact construction of these units
enhances both performance and safety by offering only a minimal
number of leakage points compared with many potential sources of
leaks found in conventional DP flow installation. The compact family close-couples the transmitter and the primary measurement
116 E&MJ • MAY 2013
device, which eliminates the requirement for long lengths of smallbore impulse piping and reduces the risk of installation errors. The
units come fully assembled and tested, and are delivered with a factory acceptance test certificate at no extra charge. This document
provides key data concerning the meter, including visual inspection
and critical dimension inspection results, a material traceability
record, pressure test results and more.
www.abb.com/measurement
Tophammer Rig is Safe and Stable
in Rough Terrain
Atlas Copco’s new FlexiROC T30 R radio remote control tophammer drill rig—designed for quarry or specialized, light-duty mine
applications—can be equipped with either a COP 1240 or COP
1640 drill for 2- to 3.5-in.-diameter holes. The standard hydraulic
carousel-type rod handling system uses 12-ft rods and can handle
up to four rods for a maximum drilling depth of 57 ft. The
www.e-mj.com
FlexiROC T30 R comes with an interim Tier
4 Cummins QSB4.5 turbo charged engine
providing improved diesel consumption
over its predecessor, the ROC D3 RRC. A
low center of gravity and high ground clearance provide mobility when working in
challenging terrain. The FlexiROC T30 R
can handle specialized tasks such as
installing self-drilling anchors, drilling
blastholes in hard rock and dimensional
stone quarrying. According to the company,
the rig’s extended boom coverage of 14 ft
through an 80° radius was designed to
save time and money by delivering more
holes from fewer set-ups. Radio remote
control comes standard, allowing the operator full control of drilling, tramming and
boom controls from a safe working distance
on confined sites or unstable terrain.
Automatic RPM reduction, adjustable fan
speeds and interim Tier 4 emissions offer
savings and improved efficiency.
www.atlascopco.com
Metal Detectors
Available in seven models to handle a wide
range of applications, Eriez Model 1200
metal detectors detect both ferrous and
nonferrous tramp metal—even when con-
www.e-mj.com
veyed on steel-cord belts. The system is
capable of detecting medium and larger
ferrous and nonferrous particles traveling
at speeds up to 1,200 fpm (363 m/min).
It operates by measuring the change in
received electromagnetic signal of material
being conveyed through the sensor area.
Since the magnetic properties of a material are completely independent of conductivity, both magnetic and nonmagnetic
tramp metals are consistently detected.
www.eriez.com
LED Fixture Requires Less
Maintenance
Dialight, a manufacturer of LED lighting
technology, unveiled its new stainless steel
linear LED fitting that is designed specifically to reduce maintenance needs in hazardous areas as a replacement for conventional fluorescent fittings. Available in both
32W and 64W versions (2 x 18W and 2 x
36W fluorescent equivalents) and carrying
IECEx/ATEX Zone 1 certification, the 316
grade stainless steel linear LED fitting is D
Shock compliant to MOD specification
BR8470 to Grades C and D. Durable and
resistant to shock, vibration and corrosion,
the fitting incorporates a replaceable inte-
grated power supply that is guaranteed to
give maintenance-free performance for at
least five years and, unlike the fluorescents
it replaces, will not suffer from end of life
failures. According to the company, its
glare-free advanced lens design allows the
new linear LED to replicate fluorescent
light distribution pattern while simultaneously improving light output and dramatically reducing the impact area of the traditional polycarbonate diffuser. The SafeSite
LED Linear is T4 temperature rated for reliable performance from -20°C to 60°C and
L70 lumen maintenance at 25°C for
100,000 hours. The units are IP66/67
(pending) rated for superior ingress protection and are sealed at the end caps, limiting the surface area compared to conventional fluorescents.
www.dialight.com
MAY 2013 • E&MJ 117
PROFESSIONAL SERVICES
C O N S U LTA N T S & S E R V I C E S
FOR SALE
HELP WANTED
118 E&MJ • MAY 2013
www.e-mj.com
ADVERTISING INDEX
ABB ..................................................................21
Agru America ..................................................117
Agua Terra ........................................................95
AIMEX................................................................67
ALL Erection & Crane Rental Corp ..................102
Andritz Separation Inc ......................................71
Applied Industrial Technologies ........................15
Atlas Copco ......................................................47
Baobab Resources Plc ......................................83
Barclays............................................................97
BCI....................................................................79
BDM ..................................................................82
Bearing Man Group (BMG) ................................89
Bell ..................................................................92
Boart Longyear ................................................BC
Camfil APC..........................................................9
China Coal & Mining Expo 2013 ......................76
Cummins Inc ....................................................17
DRA ..................................................................78
Ferry Capitain ..................................................57
FLSmidth MAAG Gear ........................................37
GE Oil & Gas - SPS ..........................................31
Geometrica........................................................23
Global Business Reports (GBR) ........................88
Gondwana ........................................................87
Hannay Reels ....................................................55
Hilliard Corp....................................................108
Hitachi Construction Machinery Co, Ltd ..........IFC
IDS - Ingegneria Dei Sistemi ............................74
Impacto ............................................................81
Intec Video Systems, Inc ................................113
J.D. Neuhaus ....................................................25
Joy Global..........................................................45
Kal Tire............................................................100
Komatsu............................................................61
Longwall USA 2013 ................................103-105
Lubriplate Lubricants......................................107
VISIT WWW.E-MJ.COM
FOR
FOR MORE
MORE INFORMATION
INFORMATION
www.e-mj.com
Metso ..............................................................IBC
MineSight (Mintec, Inc) ....................................68
Mining Media Int’l ............................................72
Mining Media Int’l - Social Media ..................112
Minopex ............................................................84
Nidec Motor Corp ..............................................19
Norco ................................................................82
Normet ............................................................109
Park Inn by Radisson ........................................96
Pathway Polymers ............................................75
Perumin (Extemin) ............................................65
Putzmeister ......................................................51
Reutech Mining ................................................13
Robit Rocktools ..............................................111
Rockmore Int’l ................................................116
Röhlig-Grindrod Logistics ................................90
Sal & Caldeira ..................................................81
Sandvik Mining ..................................................3
SEL....................................................................41
Siemens Energy & Automation..........................11
Soclima ............................................................86
Spinner II (T.F. Hudgins Inc) ............................115
Sprung ..............................................................73
SRK Consulting ................................................85
Stellar Industries Inc ........................................27
Sulzer Pumps ....................................................53
Target Logistics ................................................39
Tayanna ............................................................93
TerraSource Global ..........................................117
Trak Auto (Komatsu) ........................................94
ThyssenKrupp Resource Technologies ..............69
United Rentals ..................................................35
UTi ....................................................................91
Vazal Logistics..................................................89
Weir Minerals ......................................................7
World Mining Equipment (WME)......................101
Xylem ................................................................99
WANTED
WWW.E-MJ.COM
MAY 2013 • E&MJ 119
EMJ_pg120_EMJ_pg120 5/3/13 9:43 AM Page 120
MARKETS
Gold Market Regains Footing after
Being Routed in April
By Steve Fiscor, Editor-in-Chief
There is an old expression that says “sell
in May and go away.” Gold investors either
got a head start in April or the worst is yet
to come. Gold did manage to claw back
half of its April losses by the end of the
month. On May 1, gold prices closed at
$1,458.10/oz. As a point of reference,
E&MJ’s Price Index in the April edition
listed the gold price as $1,595.80/oz
(March 28, 2013). Month-to-month, that
was a $137.70/oz loss (or 8.6%), but
there is much more to the story.
Looking at the market from a half-full
perspective, gold prices are up 7.8% from
the 26-month low the markets witnessed
during mid-April. On April 15, gold closed
at $1,352.60. On both April 12 and April
15, gold prices fell 13%.
Analysts have credited the partial
bounce back to bullion and jewelry purchases in India and China. Similar to
many religious cultures in the northern
hemisphere, May is also the peak for
Hindu weddings, where gold is often purchased for brides. Physical gold buying
has been high during this period of soft
prices, but it hasn’t been high enough to
offset investor selling exchange traded
funds (ETFs).
The gold held by ETFs declined sharply
as investors sold shares. Similarly, indicators with sales activities regarding futures
contracts are signaling that investor interest is cooling. With all of the ETF gold
coming onto the market, gold investors are
worried about an overhung market. As of
April 26, ETFs held 73.4 million oz of
gold, which was down more than 5% since
the two-day mid-month plunge in prices
and more than 13% since the beginning
of the year.
Meanwhile, treasuries are reporting
record gold coin sales in the U.S., Canada,
Great Britain and Australia. Analysts
attribute this divergent demand trend to
the difference between individual investors who buy and hold gold as opposed to
large hedge funds that are liquidating
positions in the gold ETFs.
(May 1, 2013)
Precious Metals ($/oz)
Gold
$1,458.10
Silver
Platinum
Palladium
Rhodium
Ruthenium
$23.65
$1,482.00
$688.00
$1,150.00
$85.00
Base Metals ($/mt)
Minor Metals ($/mt)
Exchange Rates (U.S.$ Equivalent)
Aluminum
$1,788.50
Molybdenum
$25,000
Euro (€)
1.3186
Copper
$6,875.00
Cobalt
$27,600
U.K. (£)
1.5557
Lead
$1,970.00
Canada ($)
0.9930
Nickel
$14,975.00
Australia ($)
1.0338
Tin
$19,775.00
South Africa (Rand)
0.1112
Zinc
$1,803.50
China (¥)
0.1611
Iron Ore ($/dmt)
Fe CFR China
$133.75
Gold and silver prices provided by KITCO Bullion dealers (http://www.kitco.com). Platinum group metals prices provided by Johnson Matthey (http://www.platinum.matthey.com).
Non-ferrous base and minor metal prices provided by London Metal Exchange (http://www.lme.co.uk). Iron ore prices provided by Platts Iron Ore Index. Currency exchange rates
were provided by the GoCurrency.com.
120 E&MJ • MAY 2013
www.e-mj.com
EMJ_IBC 993_EMJ_IBC 993 4/19/13 10:42 AM Page IBC1
EMJ_BC 994_EMJ_BC 994 4/17/13 2:45 PM Page BC1

- Kaloti Precious Metals

Transcription

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