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IN THIS ISSUE CIM MAGAZINE OCTOBER | OCTOBRE 2014

REPORT: 55 SPECIAL China cover story

China is the worldâ€™s fastest growing major economy and a powerful player in the natural resources markets. We examine some of the forces at play in this often misunderstood country by Chris Balcom, Lu Jing, Alexandra Lopez-Pacheco, and Kelsey Rolfe

Reverse engineering

Geometallurgy programs are gaining traction as investor scrutiny and increasing complexity push miners to understand their ore bodies better by Eavan Moore

Direct connection

As throughputs at mines have steadily increased, gearless drive systemsâ€™ providers have improved the availability, reliability and energy efficiency of their products to meet operational needs by Eavan Moore

October/Octobre 2014 | 5

contenu francophone

22 8 10

Editor’s letter President’s notes

The best in new technology

tools of the trade compiled by Kelsey Rolfe and Chris Balcom

news 14 22 24

Industry at a glance Raglan mine installs innovative technology to harness the power of hydrogen by Bernard Simon

The Gordon Foundation and the Firelight Group release an updated toolkit for First Nations negotiating IBAs with mining companies by Vivian Danielson

The government of B.C. and First Nations partner to respond to the tailings breach at Imperial Metals’ Mount Polley mine

columns

by Kelsey Rolfe

upfront: copper & zinc 34

by Chris Windeyer

by Alexandra Lopez-Pacheco

30 32

by Carl Weatherell

The business case for open innovation Responsible investment: the reward of managing social risk by Monica Ospina

6 | CIM Magazine | Vol. 9, No. 7

Economist Patricia Mohr says a copper price rebound will take years, but zinc is heating up

travel 66

article de fond

47 L’ingénierie inverse

Ore variability drives crushing capacity at Copper Mountain to extremes

by Virginia Heffernan

10 69

Lincang, China

cim community by Graham Lanktree

CIM news from Canada and beyond

mining lore 74

Have your technical reports timed out? by Laurel Petryk and Greg Gosson

A former jarosite pond and a man-made wetland brought nature back to Glencore’s Kidd Metsite

The Second World War finds its way to iron ore-producing Bell Island, Newfoundland, when German U-boat captain Rolf Ruggeberg starts attacking ships off the island’s coast by Herb Mathisen

70 73

Technical abstracts Innovation showcase & Professional directory

L’examen rigoureux des investisseurs et la complexité croissante des corps minéralisés obligent les sociétés minières à mieux comprendre ce qu'elles extraient, aussi les programmes de géométallurgie gagnent du terrain. Mot du président L’ICM et OneMine font équipe Les membres de l’ICM ont désormais accès à une bibliothèque exhaustive centralisant les travaux de recherche menés dans les domaines des mines et des minéraux par Tom DiNardo

Résumé techniques

La version française intégrale du CIM Magazine est disponible en ligne : magazine.CIM.org/fr-CA

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Editor-in-chief Ryan Bergen, rbergen@cim.org Executive editor Angela Hamlyn, ahamlyn@cim.org Managing editor Andrea Nichiporuk, anichiporuk@cim.org

editor’s letter

Editorial advisory board Alicia Ferdinand, Garth Kirkham, Vic Pakalnis, Steve Rusk, Nathan Stubina Translations Karen Rolland Published 9 times a year by: Canadian Institute of Mining, Metallurgy and Petroleum 1250 – 3500 de Maisonneuve Blvd. West Westmount, QC H3Z 3C1 Tel.: 514.939.2710; Fax: 514.939.2714 www.cim.org; Email: magazine@cim.org Advertising sales Dovetail Communications Inc. 30 East Beaver Creek Rd., Ste. 202 Richmond Hill, Ontario L4B 1J2 Tel.: 905.886.6640; Fax: 905.886.6615; www.dvtail.com Senior Account Executives 905.886.6641 Janet Jeffery, jjeffery@dvtail.com, ext. 329 Neal Young, nyoung@dvtail.com, ext. 325 Account Manager Fiona Persaud, fpersaud@dvtail.com, ext. 326 Subscriptions Included in CIM membership ($177.00); Non-members (Canada), $270.00/yr (PE, MB, SK, AB, NT, NU, YT add $11.00 GST, BC add $26.40 HST, ON, NB, NL add $28.60 HST, QC add $32.95 GST + PST, NS add $33.00 HST) Non-Members USA and International: US$290.00/year. Single copies, $25.00.

eth R. Wilson enn Aw 4K

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20 1

Finalist Bes t in

he passage above belongs to Evan Osnos, who spent the last eight years reporting and writing from China. There are easy ways to explain the cultural and economic identity of the country but, the writer cautions, these explanations that rely on the standard tropes of collectivism, Confucianism and dragons will not be very useful. So, while I encourage you to read our special report on China, be warned that you will not find the key to understanding Chinese society, nor predictions of China’s return to annual growth rates of 14 per cent. There are, however, articles, such as Lu Jing’s account of one mining team’s efforts to modernize its operations and mitigate some of the environmental impacts the mine has made, which together provide some helpful coverage of what Chinese miners, investors and their western partners are currently working through. With the feature story, Reverse engineering (p. 42), Eavan Moore takes a sampling of perspectives from across the industry to analyze the development and impact that geometallurgical programs are having on project planning and investment. Risk aversion, new sampling tools and techniques, and the move from siloed expertise back to interdisciplinary teams, she explains, has miners setting end goals and working back from there. CIM members also have a new tool to use now that CIM has partnered with the online mining research database OneMine. Signing in at CIM.org will give you access to both CIM’s technical paper library as well as more than 100,000 mining and minerals-related documents hosted at OneMine. We at CIM’s national office want to add our voices to the many others who have been paying their respects to long-time CIM volunteer Ray MacDonald who passed away this summer. You will find a tribute to Mr. MacDonald in our CIM Community section (p. 66).

g hin lis

“China is so vast and contradictory – home to one-fifth of humanity, with an income gap wider than that between New York and Ghana — that we are tempted to simplify it by resorting to the archetypes that capture one side or another.”

Section editors Peter Braul, pbraul@cim.org Tom DiNardo, tdinardo@cim.org Copy editor/Communications coordinator Zoë Koulouris, zkoulouris@cim.org Web content editor Maria Olaguera, molaguera@cim.org Editorial interns Chris Balcom, cbalcom@cim.org Kelsey Rolfe Contributors Vivian Danielson, Greg Gosson, Virginia Heffernan, Graham Lanktree, Alexandra Lopez-Pacheco, Amanda Lu Jing, Herb Mathisen, Eavan Moore, Monica Ospina, Laurel Petryk, Bernard Simon, Carl Weatherell, Chris Windeyer

ian Business Pu nad b Ca

Approach with caution

Ryan Bergen, Editor-in-chief editor@cim.org @Ryan_CIM_Mag

ISSN 1718-4177. Publications Mail No. 09786. Postage paid at CPA Saint-Laurent, QC. Dépôt légal: Bibliothèque nationale du Québec. The Institute, as a body, is not responsible for statements made or opinions advanced either in articles or in any discussion appearing in its publications.

Printed in Canada 8 | CIM Magazine | Vol. 9, No. 7

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president’s notes | mot du président

A developing partnership

Sean Waller CIM President Président de l’ICM

Mention in mining circles of non-governmental organizations (NGOs) has traditionally sparked angry condemnation. These strong views on the part of the minerals industry are due to a long history of NGOs opposing mining operations and mining development. This, along with a record of inaccurate reporting, misrepresentation, lack of accountability and the overarching objective to hinder or stop mining has led to a very poor relationship between mining and NGOs. The world is changing, however, and the long-standing adversarial relationship is, too. Mining companies, especially in remote and underdeveloped areas, assume responsibility for a wide range of local community and social needs, and there are social impacts to be managed, but these challenges are complex. There is a large number of NGOs whose mission it is to improve the lives and opportunities for people in underdeveloped communities. Realizing that mines are often located in precisely these areas, and sharing these objectives, several highly respected international NGOs have partnered with mining companies to make this happen. The fact is that in many instances mining companies and NGOs can do so much more by working together. The benefits are numerous. NGOs can be effective in development work and can contribute funding so that more programs are possible. Since some mining companies are already present in many of the areas where NGOs want to be, they can introduce the NGOs to the local communities. The NGOs can strengthen development programs and provide skills that the mining companies may not have. Importantly, local communities often view NGOs as independent of the mining company and therefore develop a more trusting and objective relationship. NGOs and mining companies are reaching out to each other, and the results are good. As so often is the case, working together rather than in opposition achieves so much more and the real winners are the people in the communities where we operate! So next time you meet someone from an NGO, have a discussion, you may be surprised.

Un partenariat en devenir Dans les cercles miniers, la mention d’organisations non gouvernementales (ONG) a de tout temps suscité des commentaires réprobateurs. Ces fortes réactions de la part de l’industrie minière résultent de la longue tradition d’opposition des ONG aux opérations minières et à la mise en valeur de mines. Cette situation, conjuguée à des cas recensés de rapports inexacts, de représentation trompeuse et de déresponsabilisation et à l’objectif général consistant à contrecarrer ou à interrompre les activités d’exploitation minière, explique les piètres relations existant entre le secteur minier et les ONG. Le monde évolue, cependant, tout comme le rapport d’opposition de longue date. Les sociétés minières, en particulier dans les zones éloignées et sous-développées, assument la responsabilité d’un éventail étendu de besoins communautaires et sociaux locaux, et certaines conséquences sociales doivent être gérées, mais ces défis sont complexes. Il existe un grand nombre d’ONG dont la mission consiste à améliorer la vie et les perspectives de personnes habitant dans des collectivités sous-développées. Prenant conscience que les mines sont souvent situées dans ces zones cibles et qu’elles partagent ces mêmes objectifs, plusieurs ONG internationales très respectées ont fait équipe avec des minières afin de les concrétiser. Le fait est que dans de nombreux cas, les sociétés minières et les ONG peuvent accomplir beaucoup plus en collaborant ensemble. Les avantages sont multiples. Les ONG peuvent être utiles durant la phase de mise en valeur et contribuer du financement permettant à davantage de programmes d’être mis en œuvre. Comme certaines sociétés minières sont déjà établies dans un grand nombre des régions où les ONG souhaitent œuvrer, elles sont bien placées pour présenter les ONG aux collectivités locales. Les ONG peuvent renforcer les programmes de mise en valeur et fournir des compétences dont ne disposent peut-être pas les sociétés minières. Qui plus est, les collectivités locales considèrent souvent les ONG comme des entités indépendantes des sociétés minières et, par conséquent, elles développent avec les ONG une relation plus axée sur la confiance et plus objective. Les ONG et les sociétés minières se mettent à l’écoute les unes des autres, et cela donne de bons résultats. Comme c’est souvent le cas, la collaboration – plutôt que l’opposition – est beaucoup plus productive. Au final, ceux qui en profitent le plus sont les gens qui habitent dans les collectivités où nous exerçons nos activités! Alors, la prochaine fois que vous croiserez une personne qui travaille pour une ONG, échangez avec elle, vous pourriez être surpris. 10 | CIM Magazine | Vol. 9, No. 7

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Courtesy of Flexco

Courtesy of Atlas Copco

OF TOOLS THE TRADE

◢ Space chevron brush design

◢ Invisible asset protection During its work conducting investigations for resource and mining companies, Australia-based Chameleon Asset Protection noticed an issue with theft on mine sites. Its solution: an invisible paint for company assets, embedded with a chemical fingerprint unique to each client, and easily seen using an ultraviolet light. The paint, which appears fluorescent under the ultraviolet light, comes in a variety of colours. It can be sprayed or painted onto company equipment like drills or scanners. Once it dries it is nearly impossible to remove. Chameleon keeps a record of each marked asset and its chemical fingerprint in a secure, auditable database. If an asset is recovered by the mining company, a sample of the paint is taken using a scalpel, and Chameleon’s lab will analyze it to determine which client it belongs to. The company also drafts press releases and notices to make employees aware that the mine sites are using the invisible paint, and stresses that clients implement random spot checks on employees exiting the site each day, using special flashlights that reveal the paint. 12 | CIM Magazine | Vol. 9, No. 7

◢ Efficient dump When a traditional underground scoop truck clears the muck from the working face, it has to pull into a niche in the drift wall to dump the rock into a haul truck at a 90-degree angle. The process ends up creating a distance of 100 to 300 metres between loading and dumping. To reduce this distance between rounds to just 10 to 30 metres, Atlas Copco released a new side-dump bucket for its Scooptram loaders in June. Instead of pulling into a cut-out in the wall to dump the muck, the Scooptram, equipped with the side-dump bucket, can pull up alongside the truck in the tunnel to dump its load. “[It reduces] costs because you’re not making these niches or cut-outs in the tunnel,” said Ben Thompson, Atlas Copco’s product manager. “And you don’t have to drive the scoop all the way to the cut out to make the turn. That reduces fuel, tire wear and time.” The side dump bucket is available for the Scooptram ST7, ST1030 and ST14.

Courtesy of Chameleon Asset Protection

Constant cleaning is essential for the smooth functioning of a conveyor belt, and operators of cleated belts often turn to motorized brush cleaners for this task. But the brushes themselves also need attention and maintenance. One particularly common issue in mining operations is the buildup of wet material on the centre of the brush, according to Kevin Fale, a marketing specialist with Flexco. To address this problem, Flexo launched its new Motorized Brush Cleaner. The distinguishing feature of the product, said Fale, is its unique brush profile, what the Flexco team refers to as a “space chevron.” After experimenting with a variety of patterns, including chevron, zig-zags and spirals, Flexco discovered that tightly packed bristles prevented material from passing through as it was being dislodged and caused it to cake on the cleaner. On the new product, which uses a chevron pattern, “the bristles are spaced far enough apart to allow the material to move away from the brush,” Fale said. The cleaner is designed primarily for chevron, cleated, and raised-rib belts, and has been tested in a variety of applications including platinum, chromium and coal mines.

“It might just be the odd scanner or the odd drill, but when […] people are doing that regularly, it soon becomes very expensive to the company,” said Nina Hobson, an executive director at Chameleon. “This is about saying, ‘This isn’t acceptable behaviour and we are doing what we can to stop that from happening.’” Compiled by Kelsey Rolfe and Chris Balcom

news

Seabridge Gold’s KSM project, one of the world’s largest undeveloped gold and copper reserves, received final approval from the government of British Columbia in July for an Environmental Assessment Certificate. Only one other mine in the province has received the certificate in the last five years. Seabridge, whose other principal asset is the Courageous Lake gold project in the Northwest Territories, spent close to seven years and more than $176 million in exploration, engineering and environmental work leading to the approval for KSM in northern B.C. The KSM project has a 52-year mine life and an estimated 38.2 million ounces of gold, 9.9 billion pounds of copper, 191 million ounces of silver and 213 million pounds of molybdenum. “We had more than 30 group sessions with all the aboriginal groups, federal and provincial regulators, and Alaskan regulators,” said Rudi Fronk, the company’s CEO. “We’ve listened to their feedback and pushback and made significant design changes.” These modifications added $500 million and brought the estimated construction cost up to $5.3 billion. They include adding a liner to the centre cell of the tailing management facility to minimize the potential for downstream effects on wildlife and fisheries, redesigning the tailings management facility to have a different discharge point and relocating the mine’s access road to minimize the potential for effects on fisheries and wildlife. The company recently received more good news. While awaiting federal approval of KSM from the Canadian Environmental Assessment Agency, which is the next step in the process, Seabridge confirmed in early September another major new gold and copper occurrence at KSM. It is now intensifying its drilling program in order to collect the data needed to develop an updated resource estimate by January. 14 | CIM Magazine | Vol. 9, No. 7

“We’re doing all the de-risking,” said Fronk. “Our goal now is to have a

joint venture in place by the end of first quarter 2015.” – Alexandra Lopez-Pacheco

Photo by: Jill Thompson, Source : © Office of the Prime Minister, (2014)

Seabridge receives B.C. approval for KSM

Prime Minister Stephen Harper announced in August the launch of the Arctic program that will carry out work on resource development, northern transportation, marine safety and community infrastructure in the Far North.

Feds pledge to improve ice roads Mine operators in the Far North who rely on old man winter for transportation routes have gained a new ally. Prime Minister Stephen Harper announced in August the launch of a federally funded project dedicated to improving the safety and performance of northern ice roads. The project is part of the new Arctic program led by the National Research Council (NRC). The ice road project will focus on how to maximize the use of ice roads often employed by mining companies to transport goods from northern sites. Currently, ice roads are open from one to three months depending on where the road is located, said Arctic program leader Anne Barker. She added that the project could take various forms such as strategic research and development or technical services that provide solutions to specific problems brought forth by mining companies. The Arctic program as a whole will carry out work on resource development, northern transportation, marine safety and community infrastructure. “Overall, the point of the program is to ensure that if there’s resource development in the Arctic, that it occurs in a safe and environmentally responsible manner,” Barker explained. The program will cost the federal government $17 million over eight years. They are looking for a further $65 million in investments from industry partners. Work started on the ice road project in August to figure out users’ needs. “We’ve had conversations with industry partners involved in the area,” said Barker. “We’re working toward an end-user discussion.” “I’m very excited by the program,” she said. “It’s great to have a defined focus.” According to Barker, the ice road project alone is expected to take up to five years. The Arctic program was created in the recent restructuring of the NRC, which involved concentrating the organization’s efforts on industrial research instead of basic science. – Tom DiNardo

news Ring of Fire development corporation announced In late-August, within 60 days of taking office, the Ontario Liberal Party made good on its $1-billion promise to kick-start a development corporation (known as Devco) for the Ring of Fire region in northwestern Ontario. With its headquarters in Thunder Bay, 540 kilometres south of the massive chromite, copper and nickel district worth an estimated $60 billion or more, Devco’s first task will be to develop an agreement between government, industry and local First Nations on how all groups will participate in the organization. In time, Devco could dictate the type and location of infrastructure leading into the remote region. The Ontario Liberals have appointed an interim four-person board of directors to oversee this first stage of Devco. The board currently consists of assistant deputy ministers from Cabinet Office, the Ministry of Transportation and the Ministry of Northern Development and Mines. The executive vice-president of

Infrastructure Ontario also sits on the board, while the assistant deputy minister from the Ministry of Aboriginal Affairs will be added to the roster soon. No formal infrastructure decisions will be made, however, until a larger, “mature” board of directors has been established for Devco with key partners including the federal government, said Julia Bennett, spokesperson for the ministry of northern development and mines. No timeline has been set for when the full board will be in place, but once it is, Devco will begin making investment decisions about “strategic transportation infrastructure,” including how best to spend $1 billion pledged by Premier Kathleen Wynne during the recent election, she said. Mining Minister Michael Gravelle first promised the creation of Devco in November 2013 to set the tone for how the Ring of Fire could be developed in co-operation with all interested stakeholders. Consulting firm Deloitte was brought on board in February to create the new entity’s legal and governance – Andrew Reeves structure.

Investors step up for Imperial Metals Bolstered by a $115-million cash infusion, Imperial Metals is continuing its cleanup efforts of the Mount Polley tailings pond breach and work to complete its Red Chris mine in northwest B.C. The bulk of the funding announced in early September came from Edco Capital Corporation, owned by Imperial’s top shareholder, N. Murray Edwards, and The Fairholme Partnership; each purchased $40 million worth of unsecured convertible debentures. Steve Robertson, Imperial’s vicepresident of corporate affairs, said the money will go towards Mount Polley’s remediation – which analysts have estimated will cost between $50 million and $500 million – and the construction and commissioning of Red Chris, as well as general corporate purposes. “All of our money is going to be put to good use on those projects,” he said. The entrance to the Red Chris gold and copper mine was blockaded by a group of Tahltan First Nations’ members, known as the Klabona Keepers,

Vancouver-based True Gold secured up to $120 million in August to finance its Karma gold project in Burkina Faso. The company announced August 11 it had entered into a US$100-million streaming agreement with FrancoNevada and Sandstorm. True Gold has the option of increasing its funding by as much as $20 million in the next 18 months. Now that True Gold has access to this capital, said Alex Holmes, vice-president of business development, the Karma project is fully funded. “The package with Franco and Sandstorm, together with our equity on hand, gets us fully financed with a contingency built in to the end of the next year,” he said. Holmes said that since September, True Gold has started pouring the concrete for the plant foundation, and equipment continues to arrive. “[We’re] pre-stripping, adding some additional haul roads as well as moving more significant amounts of material around,” he explained. Up to this point, the company had prepared the site for the foundation of the processing plant and the ADR plant. It also improved road access in and around the mine site and built the mine’s water supply. 16 | CIM Magazine | Vol. 9, No. 7

Courtesy of True Gold

True Gold receives funds for Karma project

Construction of the mining and engineering offices at True Gold Mining’s Karma gold project

According to Holmes, construction will be completed by the fourth quarter of 2015 and production will start at the end of that year. The Karma project is an open pit, heap leach gold mine in West Africa. The project, which has an estimated mine life of eight and a half years, is expected to yield 97,000 ounces of gold annually. – T.D.

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news

BHP Billiton reverses consolidation BHP Billiton announced in August it would spin off a number of assets that were assembled in the 2001 merger that created the mining giant. The Melbourne, Australia-based company, which currently operates a global portfolio of 41 assets, will split those operations between BHP Billiton and the as-yet-unnamed new company. Company documents list “six major operated assets” it will maintain in the coming demerger. These include Western Australia Iron Ore, Queensland Coal, New South Wales Energy Coal, the Olympic Dam polymetallic mine in Australia, and the Escondida and Pampa Norte copper mines in Chile. The Jansen potash deposit, BHP Billiton’s key Canadian holding, will also remain under the company’s control. The briefing document states that the demerger “would not alter BHP Billiton’s position as the […] developer of the world’s best undeveloped potash resource in Saskatchewan.” Those major operations as well as some select copper, coal and iron projects the company has stakes in but does not operate, represent 95 per cent of its current earnings before interest, depreciation and taxes. The spinoff company that will have its own board and management will include the existing aluminum and manganese businesses as well as various base metal and coal mines in South America, South Africa, and Australia. Things are looking bright for the future of BHP Billiton, according to Darren Sissons, an analyst with Portfolio Management Corp. He noted the improving global economy should 18 | CIM Magazine | Vol. 9, No. 7

boost demand for the company’s key minerals in emerging markets, and the Jansen potash business is expected to become an increasingly important part of the global food value chain. If shareholders and regulators approve the proposal, the company expects the spinoff to be completed by the first half of 2015. – Peter Diekmeyer

Vancouver port approves coal transfer facility Port Metro Vancouver approved a new coal transfer facility at Fraser Sur-

rey Docks on August 21. When completed, up to four million tonnes of coal per year will pass through the locale, which will join other existing coal transfer infrastructures in the area. These include the West Shore Coal terminal in Roberts Bank and the Neptune terminal in North Vancouver. According to John Parker-Jervis, a spokesperson for Port Metro Vancouver, the facility will exclusively handle American thermal coal coming into Canada through Wyoming by train. Once it reaches Fraser Surrey Docks, it will be loaded onto barges and shipped

Growing support for Movember Courtesy of Teck Resources

in response to the Mount Polley tailings breach in mid-August. It ended after Imperial signed an agreement with the Tahltan on August 26, which will see the company pay for an outside engineering firm of the Tahltan’s choosing to evaluate the Red Chris tailings facility. Robertson said the evaluation should not get in the way of the mine’s opening, which is slated for – Kelsey Rolfe later this year.

While the autumn months are known for the change in foliage, November has recently become known for a different annual metamorphosis. Normally clean-shaven men put their razors aside for the month to grow moustaches as part of Movember to raise awareness for men’s health issues such as prostate cancer, testicular cancer and mental health. In 2012, the Canadian mining industry took up the gauntlet of men’s health. “Mo Bros” and “Mo Teck Resources’ haul trucks, in addition to its Sistas,” as the men and women employees, grew moustaches last year on its way to raising more than $56,000 across the company as involved in Movember are known, part of Movember’s Great Canadian Mining Challenge. decided to formalize their involvement in the campaign and established the Great Canadian Mining Challenge. The now annual event is a friendly competition within the industry where men form corporate teams and pledge to grow a moustache while raising money for the cause, competing with teams from other mining companies. One of the leaders of the effort to create the challenge was Matt Rosales, a geologist and GIS analyst at Teck. “He was kind of the one within the industry who championed the effort,” said Jeff Lohnes, business engagement manager at Movember. Last year, 484 members across 36 corporate teams helped raise more than $190,000. Aurico Gold raised $15,800, the most by any single team. Employees at Teck Resources formed 20 separate teams and collectively raised more than $56,000. “[It was an] absolutely amazing effort by employees at both companies,” said Lohnes. He added the importance of Movember goes beyond the challenge, however. “Our real focus is around raising awareness with the campaign,” he explained. “We’re always looking to make sure that more and more men have access to information around men’s health. Some of the successes we’re really seeing are where companies start to adopt better internal health practices and – T.D. internal screens for different issues.”

news to Texada Island. From there it will be transferred to ocean-going liners to be shipped to Asian markets. “One train a day will be coming into the facility,” says Parker-Jervis. “The coal will be then direct transferred, with no stockpiling permitted on site, and extra binding agents will be sprayed at the terminal before it is loaded onto the barge, in order to minimize dust.” Port Metro Vancouver did not provide a timeline for construction of the facility. The $15-million project, which is expected to create 25 direct and another 25 indirect jobs, was subject to a two-year environmental and public impact review prior to approval and no significant risks were identified. The company has stated that the facility has the potential to double in size, though such an expansion – P.D. would trigger further reviews.

Mt. Polley breach raises uranium tailings safety concerns Reverberations from the Mount Polley tailings pond breach in British Columbia continue to spread. In August, the Canadian Nuclear Safety Commission (CNSC) asked licensees of uranium mines and mills with tailings facilities to review safety procedures. In a letter dated August 14, Ramzi Jammal, the CNSC’s chief regulatory operations officer, requested that seven operators look into the causes of the Mount Polley tailings breach and confirm they are complying with existing licensing conditions and introducing measures to mitigate breach accidents. The seven licensees are AREVA, Cameco, Rio Algom, Willet Green Miller, P.J. Bruggar and Associates, EWL Management, and Denison Mines. According to Mark Drolet, a CNSC spokesperson, the organization is unaware of any past uranium tailings breaches. “With the exception of the radiological content and specific measures to limit radiation exposure, production of uranium tailings and their long-term management [involves] similar processes and practices as those [in] 20 | CIM Magazine | Vol. 9, No. 7

other metal mines (i.e. gold, silver, copper),” said Drolet. CNSC staff will also be conducting inspections of the above-ground tailings management facilities of the seven operators, according to Jammal’s letter. If any issues arise during the inspections, the – P.D. CNSC may take further action.

all of its operations this past summer, and Australia’s Cairn Hill mine, owned by Ter– P.D. mite Resources, was also closed.

Asset sales could follow Casablanca’s Cliffs takeover

The approach to First Nations consultation in Alberta became clearer recently, following the provincial government’s July release of the Guidelines on Consultation with First Nations on Land and Natural Resource Management to supplement its policy on consultation with First Nations introduced last year. The new guidelines were created after consulting with industry, First Nations and other stakeholders last October. The guidelines lay out the roles and responsibilities of project proponents, First Nations and various branches of the government including the Alberta Energy Regulator. The document also establishes the process for consultation and gives guidance on the level of consultation required depending on the scale of the project. The 2013 consultation policy includes the establishment of the Aboriginal Consultation Office that now acts as the single government authority and overseer for consultation. The office manages the consultation process, completes pre-consultation assessments and determines consultation adequacy for decisions under the Alberta Energy Regulator and makes recommendations for Alberta government ministries, said Martin Dupuis, spokesperson for Alberta Aboriginal Relations. “The previous guidelines were ministry-specific, and each ministry had different consultation processes as the Aboriginal Consultation Office was not in existence,” explained Dupuis. “[They also] did not contain sector-specific consultation matrices.” Two matrices were included as planning tools for industries. The first is designed to help companies determine whether their activity necessitates consultation. If it does, the second matrix assists in deciding if that consultation should be streamlined, standard or – A. L.-P. extensive.

Casablanca Capital, an activist investment firm, announced in late July that six of its nominees were elected to the 11-member board of Cliffs Natural Resources, giving it effective control of the company. The new board lost no time in putting its stamp on the business. In early August the slate voted in Lourenco Goncalves as chairman of the board. Goncalves, who took over from Jim Kirsch, has vowed to “set Cliffs on a course to improve performance and restore shareholder value.” Initial moves appear focused on financial engineering more than mining. In late August, Cliffs announced a $200-million share repurchase plan that will boost earnings per share and return cash to investors, rather than reinvesting in operations. In a statement announcing the buyback, Goncalves said Cliffs’ new strategy will centre on its core U.S. iron ore business. Asset sales have also been mentioned by analysts as possible future moves. Cliffs’ Canadian properties include the vast but undeveloped chromite deposit in Ontario’s Ring of Fire, as well as the Wabush and Bloom Lake iron ore operations, both in the Labrador Trough. The idled Wabush operation was already being shopped around prior to the change in the board and there is the possibility the Bloom Lake operation will be spun off as well. Recently, other iron ore producers have shed or stalled less-attractive assets. Sweden’s Northland Resources has postponed development of a second processing line at its Kaunisvaara operation and is shopping around its Hannukainen property. Labrador Iron Mines suspended

Alberta releases new guidelines for consultation with First Nations

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Transforming wind into fuel Glencore to install hydrogen fuel-cell storage system at Raglan mine

If all goes according to plan, next spring Glencore’s Raglan nickel-copper mine in northern Quebec will become the first mine in the world to cut its diesel consumption by linking a wind turbine to a hydrogen fuel-cell storage system. At the moment, only part of the project is complete. Raglan mine and its partners finished construction of a single 80-metre-high windmill at the mine on August 7 and connected the turbine to the local power supply in early September. A mine spokeswoman says the first 120-hour run-test, from Sept. 2 to 8, was successful. The windmill was supplied by Germany’s Enercon, one of the world’s biggest wind turbine manufacturers. An Enercon team as well as Raglan employees and Tugliq, a Quebec Citybased energy firm that owns the system, assembled the windmill on site. The next step is energy storage. Four shipping containers with flywheels, a battery system and other components of the storage system are due to arrive at the mine towards the end of the year. But it is unlikely to be installed for several months due to harsh winter conditions at the mine. The project involves connecting the wind turbine to an electrolyzer, which will pass wind-generated electricity through water, splitting the H2O molecules into hydrogen and oxygen. The plan is to store the hydrogen in two six-metre-long compressed-gas reservoirs – similar to horizontal propane storage tanks – and then use it to generate electricity from a fuel cell. The Quebec government has contributed more than a quarter of the project’s $22.6 million cost as part of its plan to spur economic development in the remote northern part of the province. The remaining $16 million has come from the federal government, Glencore and Tugliq. Once in operation, the mine will pay Tugliq for power from the wind system. 22 | CIM Magazine | Vol. 9, No. 7

Courtesy of Tugliq Energy Co.

By Bernard Simon

Glencore’s Raglan mine and its partners finished construction of a single 80-metre-high windmill at the mine on Aug. 7.

Hydrogen fuel cells have long been hailed as a promising source of cheap renewable energy. But researchers have struggled to translate the benefits into commercially viable projects. “There are not that many greenenergy technologies that you can use to store electricity,” said Laurent Abbatiello, principal vice-president and chief financial officer at Tugliq, who has coordinated its construction. Up to now, fuel cells have been viewed mainly as a potential replacement for the internal combustion engine in motor vehicles. For example, California-based Vision Industries has installed fuel cells in its Tyranno heavyduty truck, currently in use at the ports of Los Angeles and Long Beach. The zero-emission truck has a range of 200 miles on a single tank of hydrogen. Kevin Harrison, a research engineer at the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL), noted that fuel cells are an efficient medium for converting hydrogen to electricity, especially when relatively low heat (60-80 C) is required. Other advantages include no moving parts and quick recharging.

But hydrogen also presents some serious challenges. It takes up a lot of space relative to the energy it generates. It is also not necessarily the most efficient option. “Since you have to produce the hydrogen and then make electricity again through a fuel cell, it has a lower round-trip efficiency compared with other storage technologies like batteries and pump hydro,” said Harrison. Even so, he added, “with inexpensive renewable electricity, energy storage can be a very compelling economic possibility.” Raglan is not the first mine in Canada’s North to harness wind as a way of cutting diesel costs. Four turbines at the Diavik diamond mine in the Northwest Territories, a joint venture between Rio Tinto and Dominion Diamond Corp., already generate about 10 per cent of that mine’s power needs. Diavik estimates the wind farm will displace five million litres of diesel fuel this year, which is equal to a savings of $6 million out of an annual $70 million diesel bill. But Diavik has no storage system and uses the wind-generated power as it is being produced.

Raglan’s plans are more ambitious. “The thing with wind is that it’s not stable,” explained Abbatiello. “One day it blows, one day it doesn’t. And sometimes even the way it blows changes within a minute. The storage devices are meant to supply a stable energy level even if there is not wind all the time.” The Raglan mine pilot project has a design capacity of about three megawatts, enough to save the equivalent of about 2.5 million litres of diesel fuel a year, or five per cent of the mine’s consumption. The mine currently uses 60 million litres of diesel a year, with fuel making up one-fifth of its total operating budget. But if all goes well, Abbatiello foresees the day when a fullblown wind farm with multiple turbines will generate nine to 12 megawatts of electricity, equal to nearly half of the mine’s needs. Kristan Straub, Raglan mine’s vice-president, estimates that a wind project of that scale could slash the mine’s diesel consumption and overall energy costs by 40 per cent. The first two hydrogen reservoirs will collectively store electricity for about 20 hours, but the addition of more could considerably extend the storage period. “If results are positive, we hope that our system will serve as a model that could be installed in diesel-dependent communities, and then benefit all of Nunavik (the northern region of Quebec),” said Straub. Abbatiello is confident that the wind-to-hydrogen system will perform well: “We know that the technologies work in other applications. This is the first time that everything has been combined. So the complexity is how to integrate, control and command all those components.” CIM

giving back

A MINE OF SOLUTIONS Technical, economic and feasibility studies NI 43-101 technical reports Mine planning, design and simulation Plant design and simulation EPCM projects Commissioning assistance Power generation and T&D

Atlas Copco celebrates 30 years of Water for All initiative

Automation and industrial IT

Atlas Copco recently celebrated the 30th anniversary of Water for All, an organization created to provide longterm clean and safe water for people in need. More than 1.5 million people have gained access to clean drinking water since the company launched this initiative. The company has also donated more than $500,000 to 15 international projects since 2010. Atlas Copco announced that it will fund a $50,000 project in the Tigray region of Ethiopia; five community-drilled wells will be built to bring clean water to 2,500 residents. Up to 35 countries with around 5,000 regularly donating employees worldwide represent Water for All.

Telecommunications Optimization of drilling and blasting applications Process optimization and control

October/Octobre 2014 | 23

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Fall debut for updated IBA Community Toolkit Whitehorse workshop sheds light on Yukon First Nations’ agreements with mining companies

Yukon First Nations gathered in Whitehorse in mid-August to discuss impact and benefit agreements (IBAs) and add their views to an updated IBA Community Toolkit scheduled for release this fall. The toolkit is intended to help aboriginal communities negotiate IBAs with mining companies looking to start projects on their territory. Ginger Gibson, co-author of the toolkit, said it was important to learn more about past and present IBAs between Yukon First Nations and resource companies before the revised guidebook is offered to aboriginal communities across Canada in October. “We had never held an event in Yukon before and never developed a good feel for Yukon issues,” Gibson said. “It was timely, with many parties interested in Yukon now.” In addition to this crucial background, Gibson said the revised document also captures the evolution of IBAs since the original was released in 2010. Financial arrangements between aboriginal communities and resource companies may now include gross overriding royalties for mines and profit-sharing deals with, or equity stakes in resource companies, rather than simply employment and contracting opportunities, as was typical in the past. As a result, the updated toolkit will place increased emphasis on financial planning and management. Aboriginal communities should prepare for greater transparency of IBAs, Gibson added, as the federal government is drafting legislation to lift the cloak of confidentiality and require disclosure of IBA payments exceeding $100,000. “This [information] was held closest to the chest,” Gibson said. “But some IBAs are public now, so the cat’s out of the bag on financial considerations.” The toolkit is published and distributed by the Walter and Duncan Gordon 24 | CIM Magazine | Vol. 9, No. 7

Courtesy of the Gordon Foundation

By Vivian Danielson

Ginger Gibson (center) at an IBA workshop in Yellowknife, NT in September 2011, after the launch of the original toolkit.

Foundation, a Toronto-based philanthropic organization focused on policy issues in the North. Research and technical support is provided by the Firelight Group, of which Gibson is a director. They also collaborate on IBA workshops, including the recent Whitehorse event. The value in the August workshop, said James MacDonald, natural resources and environment manager for the Council of Yukon First Nations, came from sharing different experiences and perspectives. Unlike B.C., Yukon First Nations have settled most land claims and are largely self-governing, he pointed out. Yukon’s battle for devolution from Ottawa, won in 2003, has further empowered First Nations communities to directly negotiate IBAs. Along with precedent-setting IBA case studies from Yukon, the updated toolkit will reflect and help explain recent legislative changes and aboriginal court decisions from across the country. As examples of this new content, Gibson cited the 2014

Supreme Court ruling on the Tsilhqot’in title claim in British Columbia, and revisions to the Canadian Environmental Assessment Act. “We see the toolkit as a living resource,” Gibson said. “[The updated version] will also address issues such as the Mount Polley tailings dam failure in B.C. We saw the need to reflect on prevention and technical solutions and include suggestions on the terms for [industry] commitments such as compensation.” IBAs vary greatly depending on the type of project, and with no universal blueprint, negotiations are often a challenge for all parties. Aboriginal negotiating teams can range from two to 20 people, noted Gibson, and many lack the resources and capacity of the companies they face across the table. In the past, he said, “Some didn’t know how to build a budget, for example, which is why we developed budget worksheets. The goal was to provide tools and resources, including the basic dos and don’ts of negotiations, to guide them through every stage of the process.”

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Gibson said most IBA workshops of the type held in Whitehorse are requested by communities facing resource activity and/or development proposals. The original IBA Community Toolkit grew out of a 2007 Gordon Foundation northern policy forum in the Northwest Territories and was further developed from input during meetings with aboriginal leaders across Canada (with the now remedied exception of Yukon). The content stresses the need for negotiators to establish the baseline socio-economic, cultural and environmental conditions of their communities and how things might change – for better or worse – if the project goes ahead. The other main sections focus on preparing for and conducting negotiations, reaching and implementing agreements, and maintaining relationships. Allen Edzerza, a Tahltan and veteran negotiator who has attended IBA workshops across Canada, including the

Whitehorse event, said the toolkit provides a common starting point for aboriginal communities, particularly those

with no negotiating experience. “It’s helping,” he said. “The ones that have accessed it are pleased with it.” CIM

giving back Kenya school hall opens with Ausenco Foundation support The Ausenco Foundation announced that the Magaoni Secondary School Multipurpose Hall officially opened in August, a joint project with Base Titanium and the Magaoni community. The Ausenco Foundation partially funded the multi-purpose hall’s construction, aimed at providing better learning services and facilities for the students and the surrounding communities. It is located near the Kwale Mineral Sands mite site, owned and operated by Base Titanium, which is constructing a second school on the site. October/Octobre 2014 | 25

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Collaborative response B.C. government and First Nations team up to tackle the aftermath of the Mt. Polley tailings breach

When the tailings pond dam ruptured at Imperial Metals’ Mount Polley mine on August 4, it sent 10 million cubic metres of water, 13.8 million cubic metres of tailings slurry and 0.6 million cubic metres of construction waste into Hazeltine Creek, an amount the company said in September was 78 per cent higher than original estimates. To address the spill, the government of B.C. announced in August it would partner with two local First Nations’ bands affected by the tailings breach and ordered an independent investigation to determine what caused the breach. The partnership between the provincial government and the Williams Lake and Soda Creek Indian Bands, outlined in a letter of understanding, consists of a principals table and a senior officials committee. The committee, made up of representatives from the Ministries of Environment, Aboriginal Relations and Reconciliation, and Energy and Mines, as well as delegates from the First Nations groups, will oversee cleanup and remediation planning, and assess funding requirements as well as the future of the mine. The ultimate decision-making authority will remain with the province. The committee will report back to the principals table, a group that includes the three ministers and the two First Nations chiefs. There is no deadline for the report as of yet. The letter of understanding also promises $200,000 to each band in the partnership for current and future costs incurred by the breach. The independent investigation is being conducted by a panel of four: Norbert Morgenstern, an Alberta expert in geotechnical engineering; Steven Vick, a Colorado geotechnical engineer; Dirk Van Zyl, a University of British Columbia professor; and Jim Kuipers, a Montana-based mining engineer who will act as a First Nations 26 | CIM Magazine | Vol. 9, No. 7

Flickr/The Province of British Columbia

By Kelsey Rolfe

The government of British Columbia announced in August it would partner with the Williams Lake and Soda Creek Indian Bands to determine what caused the breach.

liaison. The panel has the power to compel evidence and will give its report with recommendations to the province by January 31, 2015. “We tried to find people who had experience in these types of investigations, who had the knowledge and expertise to be able to undertake the work that needs to be done,” said John Rustad, the minister of aboriginal relations and reconciliation. “Our hope is to get to the bottom of what happened and how it happened so that we can, as a province, make sure that this sort of thing never happens again.” In the letter of understanding, the province promises a “dialogue” on existing mining sector laws and regulations. Ann Louie, chief of the Williams Lake band, said she wants to see more than talk come out of the partnership and investigation. “We need stricter rules,” she said. “Right now the [provincial] government wants to push for 30 new mines. Just because there’s potential doesn’t mean that it should be pushed through. The rules have to be stringent, because we don’t want any more disasters like this.”

Louie said she hopes to see bonds increased to between $15 million and $100 million for companies looking to open a new mine. “Right now, like with Mount Polley’s disaster, the bond that was there is next to nothing compared to what it’s going to cost to deal with this situation,” she said. Louie also called on the provincial government to take the recommendations of First Nations members of the partnership seriously: “I think it’s critical for the British Columbia government to listen now, because they have not listened in the past.” Imperial Metals is not involved in the partnership, but Steve Robertson, the company’s vice-president of corporate affairs, said Imperial has escalated its monthly meeting with the Williams Lake and Soda Creek bands to convene almost weekly so that the three parties have a “good, full understanding about what each other is doing.” He also said the company is conducting its own cleanup and constructing a dyke inside the tailings impoundment. Robertson said Imperial Metals is not looking to reopen Mount Polley

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giving back Philippi-Hagenbuch targets cancer research

Courtesy of Phlippi-Hagenbuch

until the company has completed its three-part initial response plan, helped to rehabilitate Hazeltine Creek and repaired the tailings pond. He said he sympathized with community members and First Nations who found the footage of the spill disturbing but added that the tailings pond has non acid-generating tailings, so the “level of deleterious elements in the tailings is very low.” “It’s a shocking experience for everybody to have something like this happen, and it will take some time for these wounds to heal,” he said. “One of the best ways to ensure that we move beyond this though is to have a continual and open dialogue with the community members.” CIM

U.S.-based group PhilippiHagenbuch, Inc. and the Susan G. Komen Memorial are working together to raise awareness about breast cancer prevention and to raise research funds aimed at finding a cure. For each pink PHIL Autogate® Tailgate purchased through the Pink Tailgate Initiative, the company will give five per cent of the proceeds to the Memorial. All tailgates are pink and decorated with a ribbon. This initiative runs through December 2014.

October/Octobre 2014 | 27

S TA N D A R D S

Have your technical reports timed out? BY LAUREL PETRYK AND GREG GOSSON

n today’s economic climate, with many mining companies in survival mode and expenditures down, the last thing companies want to worry about is technical reports on their material mineral properties, and whether those reports are still current. It is easy to think that, because exploration programs are limited and there are no new material results to disclose on a property, the technical report on the property is still up to date. However, this is not necessarily the case. Mining companies are generally only legally required to file a technical report on a material property when they hit a trigger under National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101). Technical report triggers can be events related to activities on the mineral property like a first-time disclosure of, or material change to, a mineral resource, reserve or preliminary economic assessment (PEA). When a mining company does file a technical report on the System for Electronic Document Analysis and Retrieval

(SEDAR), the report must be complete, current and contain all material information about the property. But what happens when things change? Perhaps metal prices used in mineral resource estimates a few years ago are now considered too high, permits expire, or there is a significant change in the project boundary? What about when obligations to maintain the project have changed? Or recommendations in the technical report are no longer valid or plans for the property have changed for various reasons including a change to the jurisdiction’s tax or royalty regime. Is the technical report still considered current? Some of the triggers to file a technical report under NI 43101 are events related to documents filed by the company, such as annual information form (AIF), and do not necessarily apply at the project level. A company can rely on a previously filed technical report to satisfy the AIF trigger; however, it can do so only if there is no new material scientific or technical

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columns information about the project. If the technical report is no longer current, and the AIF has new scientific or technical information about the project, including information about potential economics, an updated technical report containing all the new project information must be filed on SEDAR to support the information in the AIF. How can a mining company determine if an existing technical report it has on file on SEDAR is complete and current? If there are no new exploration or mining study results and the site visit is still current, a company should look at the scientific and technical information as presented in the existing technical report, including the validity of economic assumptions used, and determine whether such information is still current and not misleading in todayâ€™s economic conditions. For instance, some assumptions used in mineral resource estimates or economic analyses in relation to metal prices and exchange rates may now be considered out of date. If a table showing sensitivity of the mineral resource estimates to cut-off grade was included, the shelf life of the technical report can be extended since it would support a wider range of long-term metal prices. For more advanced properties that include an economic analysis, the technical report should contain the appropriate sensitivity analyses of key economic variables to show how changes, for example, to commodity prices, costs, exchange rates and other factors can affect project economics.

We have often seen regulators ask companies to file updated technical reports when they consider the current ones misleading to investors. If a company is relying on an existing technical report filed on SEDAR that is no longer current to form the basis of its continuous disclosure, the company should at the very least provide an appropriate context for the information and cautionary language that clearly explains any possible risks to investors of relying on that existing report so that the disclosure is not misleading. Since market windows open and close quickly, a mining company could pay the price further down the line if it does not keep its technical reports up to date. When equity markets become available to raise finance again, non-current technical reports could deter an investment bank and hold up the filing of a prospectus, rights offering, or offering memorandum, causing a company to lose out on a valuable financial opportunity. CIM Laurel Petryk is a partner in McMillanâ€™s Vancouver office in the mining and securities department. SheÂ has extensive experience advising on NI 43-101 issues and reviewing technical reports and feasibility studies for mining companies in all stages of development. laurel.petryk@mcmillan.ca Greg Gosson is technical director, resource estimation and compliance at AMEC. He is a recognized expert and frequent speaker on NI 43-101 and other international mining disclosure standards. He is currently a member of the Mining Technical Advisory and Monitoring Committee for NI 43-101, an industry advisory committee to the Canadian Securities Regulators. greg.gosson@amec.com

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October/Octobre 2014 | 29

I N N O VAT I O N

The business case for open innovation BY CARL WEATHERELL

n March 2000, Goldcorp published 45 years of proprietary data on its Red Lake mine in northwestern Ontario and its surroundings on the Internet. The company invited the world at large to use the data to submit prospecting methods and received 1,400 proposals. From these, Goldcorp selected a total of 25 semi-finalists and three finalists who identified 110 exploration targets. Half of those were previously unknown to the mineâ€™s geologists and 80 per cent of them have since netted significant deposits. The end-result was the identification of eight million ounces of gold, and the companyâ€™s valuation moving from around $100 million to $9 billion. Goldcorpâ€™s success is also one of the few case studies of open innovation by mining companies. Many companies struggle with the notion of innovation (never mind open innovation) because they equate it with R&D. This could not be further from the truth. Innovation, in the context of the minerals industry, is about bringing

30 | CIM Magazine | Vol. 9, No. 7

something new to the business such as ideas, technology, processes or research that provides measurable, economic value. Without a direct and tangible link to the economic drivers of the business, activities labelled innovation are simply activities and not innovation. Open innovation takes this a step further. It is about bringing new ideas, technologies, processes or research from both inside and outside a single company or the minerals sector. This could be from collaboration with other companies, suppliers, original equipment manufacturers (OEMs), colleges and universities to improve results. As the Goldcorp example shows, openness can provide solutions with less risk and a higher success rate and enrich the culture of innovation in the process. Another benefit of open innovation is cost reduction. In 2010, AngloGold Ashanti created the Technology Innovation Consortium (TIC), an open innovation organization in South Africa that includes OEMs, suppliers and research institutions.

columns With TIC, AngloGold hopes to develop a solution to the challenges of safe and sustainable mining at depth by repurposing currently available safe technologies for the mining industry to replace drill and blast techniques. Although it is still a work in progress, AngloGold has been able to reduce its all-in sustaining costs by 22 per cent using the outputs of the open innovation approach. Theyâ€™ve achieved this by increasing the sources of ideas and sharing solutions to specific challenges while mitigating development costs. Open innovation may be rare in mining but it is not a new concept, as many companies in other sectors of our economy practise this approach. BMW, Proctor and Gamble, Tesla, PricewaterhouseCoopers, IBM and Google are a few examples of companies that, in recent decades, have employed this strategy and enjoyed healthy profits. Of course there are many myths surrounding open innovation. The first is the perceived value of intellectual property (IP) developed in-house. With todayâ€™s rapid pace of change in the global economy, companies in all sectors are looking to quickly develop and execute projects. In the minerals industry, companies are focused on bringing new mining projects online faster with less capital expenditure. In this climate, companies would do well to forgo the time and expense of patenting their IP in exchange for rapid development. One mining company executive we spoke to recently explained their company had generated a large amount of IP but was increasingly convinced it would be more valuable to open up and let external parties access and build upon it rather than protect it. Related to the IP challenge is the notion that companies can collaborate while competing at the same time. Open innovation employs collaboration and co-creation, sometimes with competitors of a core piece of technology, process or IP. In this case, the value of open innovation to these businesses comes from the profit gained individually or collectively through the co-created assets. For example, two companies co-develop patents for an inexpensive and effective baseline emission control technology that is beneficial to both companies in different markets. Neither of the partners, however, is a product company, so they both contribute IP to a start-up manufacturing company funded by outside investors to produce their technology. The company is jointly marketed by the partners and complements current service offerings to each of their customers. It is important for mining companies to address major technical challenges in order to increase shareholder value. What if you could find new deposits faster at a greatly reduced cost? What if you could reduce operational expenditures by five per cent annually through energy efficiency? Imagine that you could eliminate grab sampling of receiving waters or tailings altogether. These are some of the greatest technical challenges the industry faces, yet has not been able to solve. Only through an open innovation approach can we even think about addressing them, let alone achieving success. CIM Carl Weatherell is the executive director and CEO of the Canada Mining Innovation Council. Carl is a change agent known for discovering new ways of doing things and taking ideas to execution. He is a natural connector, often bringing together disparate and seemingly unrelated people, groups and organizations to create new partnerships.

October/Octobre 2014 | 31

C O M M U N I T Y R E L AT I O N S

Responsible investment: the reward of managing social risk BY MONICA OSPINA

t may be tempting, at a time of low commodity prices and incessant demands for low-cost production, to focus on short-term costs rather than long-term issues like building a collaborative relationship with communities in a mineâ€™s area of influence. But smart mining companies consider the trends around investor demands. Since the 2008 financial crisis, institutional investors have become more aware of the need to have healthy short- and long-term portfolios. They cannot afford to carry companies exposed to social conflict or without risk mitigation programs customized to their operation. This comes in part with the rapid growth of the Principles of Responsible Investment (PRI). This independent initiative was convened by the United Nations in 2005 and officially launched by UN Secretary-General Kofi Annan in 2006. It looks to encourage investors to integrate environmental,

social and governance (ESG) factors in their decision making when buying or investing in companies. PRI motivates companies to incorporate good practices such as sustainability and corporate social responsibility (CSR). This heightened focus on responsible investment means that mining companies must demonstrate that they have implemented sustainability practices around ESG to secure long-term funding. Shareholders are committed to their investments on a scale of 10 to 20 years and want to know that the companies they invest in have developed procedures to keep those assets healthy. This means managing social risk. Unrest among people impacted by a mining project will lead to conflict and disrupt operations, possibly through protests, road blocks or vandalism. These can result in anything from short-term production slowdowns to the governmentâ€™s permanent shutdown of the mine.

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Consider a hypothetical town in South America where a truck from a nearby mine hits and kills two chickens owned by a local farmer. If the company has implemented good practices in community relations and opened communication channels through ongoing dialogue or grievance mechanisms, the chickens’ owner knows where to go and what to do to present his or her case, and trusts the company to provide compensation for the loss. But if the mining company has not acknowledged its stakeholders, is disrespectful toward the community, and is too distant to communicate with locals, those two chickens might cause the community to explode in anger, leading to social conflict. It is difficult to quantify the costs of such a conflict, but ignoring the risk exposes the company to millions of dollars in losses if roadblocks cause a production stoppage, negative headlines and a tarnished reputation. In building good relations with stakeholders and ensuring CSR is done right, a company needs to consider elements other than philanthropy. Too many in the mining industry rely on this approach. However, donations to local churches or NGOs do not do the job of community engagement and risk management. Effective community relations should involve building partnerships, often around creating socio-economic opportunities for local people. This includes a commitment to local procurement and planning the development of the project around the capacity of local economies and education. Management at a mining company also must incorporate community relations into their overall operation. From the start, mining companies should have a professional approach to communities in their direct and indirect area of influence. That is the time at which the mining company should begin to engage with the community, finding ways to understand the socio-economic environment and build long-term relations. Like the operation, this is an ongoing process and part of daily activities. Additionally, companies need to know how to manage accidents when they happen. What is important is whether there is an effective plan for dealing with problems. If the company has already forged a solid relationship with the community and has communication channels, problems can be discussed and resolved more easily and respectfully. It is important to understand how expensive it could be to ignore sustainability and CSR, especially when the growth of PRI indicates that investors agree on the need for well-managed companies that are able to mitigate social risk, avoid social conflict and ensure a healthy environment for a long-term mining operation. CIM

2015 CIM AWARDS Prix d’excellence de l’ICM

CIM DELIVERS RECOGNITION L’ICM RECONNAÎT L’EXCELLENCE

TAKE THE TIME to nominate a company or an individual who has made an impact within our industry. DEADLINE: DECEMBER 1ST, 2014 CIM.ORG/AWARDS

PRENEZ LE TEMPS de soumettre une candidature pour le prix d’excellence de l’ICM. DATE LIMITE : 1ER DÉCEMBRE 2014 CIM.ORG/PRIX

Monica Ospina is founder and director of the social economic development consultancy OTrade, with a focus on the extractive industries (otrade.ca).

October/Octobre 2014 | 33

Courtesy of Glencore Canada

Reclamation on solid ground How a former jarosite pond and a man-made wetland brought nature back to Glencore’s Kidd Metsite The jarosite pond area after reclamation

By Chris Windeyer

he jarosite pond and the area around it at Glencore’s Kidd Metallurgical site (Kidd Metsite) in Timmins, Ontario was an eyesore three and a half years ago. More than 800,000 tonnes of jarosite, an iron sulphate byproduct of refining zinc ore from the nearby Kidd copperzinc mine, covered 30 hectares, an area the size of 56 football fields, with brown and red water and sludge. Flash forward to 2014, and today the area resembles what it used to look like in the days before industry: an open green meadow. For its work reclaiming the pond and the area around it, Glencore Canada Corporation won the 2014 Tom Peters Memorial Mine Reclamation Award, handed out every year by the Canadian Land Reclamation Association and the Ontario Mining Association in recognition of the best mine cleanup work in Ontario. Kidd Metsite was mostly shut down when zinc and copper smelting ceased in May 2010 and the bulk of its buildings were dismantled. However, the concentrator at the site continues to process ore from the Kidd mine, 27 kilometres away. The pond was built in 1971 and, during the very early years, some seepage from the containment area into nearby Three Nations Creek was detected and quickly contained. Over the life of the site, there was continuous monitoring and additional upgrades were made including the construction of seepage collection ditches, pump-back systems, and stabilization berms. “When closure of the jarosite pond began in 2010, the pond had been stable for the majority of its years in use,” says David Yaschyshyn, Kidd Operations’ environment manager.

Building on mud The closure of the jarosite pond, including the dewatering of the sludge and the covering of the remaining material, posed a challenge as this waste had the consistency of mud, making it difficult to build on or over. “Part of the challenge for our project design partner, AMEC Environment & Infrastructure, was to establish a surface upon which we could install the final covering,” explains John Stroiazzo, Glencore 34 | CIM Magazine | Vol. 9, No. 7

Canada’s manager of reclamation and projects. “To create this stable platform across the pond area, we used waste rock obtained from a nearby gold mine.” Next, the team installed a massive liner out of thousands of sheets of 60-millimetre-thick black high-density polyethylene welded together to create what Yaschyshyn describes as a massive quilt. Wind was a constant nemesis, however. On breezy days, a crew of 12 to 15 workers would use sandbags to hold down the sheets as they were welded together. On very windy days, work on the liner stopped completely. The team checked every weld for integrity, Yaschyshyn says. Finally, the crew added a layer of soil almost one metre thick. The soil itself was augmented with municipal biosolids – dehydrated human waste culled from sewage treatment plants in Toronto and Ottawa. “The nutrients in the biosolids were readily available,” Yaschyshyn says. “It’s like putting Miracle Gro on your garden.” Though the idea of using biosolids may make some squeamish, they are safe and nontoxic by the time they are applied, and pose no danger to the environment according to Glencore. The approach of using biosolids as fertilizer in farming and reclamation work is one being promoted by the Ontario government, says Stroiazzo. He adds that using biosolids has an added benefit: “It comes at a very good price: it’s free. The vegetation over the former pond grew quickly and flourishes to this day.” The result is a lush green meadow and the return of an industrial waste site to something approaching a natural state. Even so, Yaschyshyn says the site will still be monitored for ongoing care and maintenance of the vegetation, which cannot include trees because root systems could damage the liner. “Financial provision has been made for this long-term monitoring and maintenance,” he adds.

A thriving ecosystem Although not so impacted by the nearby industrial activity that it required full remediation, Glencore Canada still included Three Nations Creek, located slightly downhill from

upfront

the jarosite pond, in the multi-million dollar remediation project. The concentration of metals in the creek’s water would rise and fall seasonally as soil and sediment containing some metals, particularly zinc, would dry out then wash into the creek during heavier rains. “Prior to the project, the creek was already relatively healthy with all kinds of fish and invertebrates living in it,” says Yaschyshyn. Stroiazzo says the company considered a range of options, from leaving the relatively healthy creek untouched to completely removing the creek bed. The final remediation plan consisted of a series of dams and ditches that raised the water level in the creek to ensure the water cover was maintained to keep the soil and sediments from drying out. This was accomplished by creating a 10-hectare wetland as part of Three Nations Creek. As a result, the presence of zinc in the water no longer spikes after a dry season and has declined yet another order of magnitude, now regularly below provincial water quality objectives. “Creating this wetland provided for a more sustainable way to manage the nearby ecosystem, says Yaschyshyn. “Not only does this wetland help prevent the drying of the soil in summer and its washing away into the creek during the rainy season, but it also includes a network of passageways designed to allow fish to move up and downstream unencumbered.” “Three Nations Creek is a thriving ecosystem,” concurs Stroiazzo. The complete project, which employed as many as 50 workers, cost more than $50 million and was deemed a success as attested by Glencore Canada’s recent win of the Tom Peters Memorial Mine Reclamation Award. “Although we are still in active operation with a mine, concentrator and tailings area, this project is an example of how we will undertake future closures at our site,” says Yaschyshyn. “We have set the bar high and are committed to the same level of effort to minimize our impact on the environment while in operation and to remediate our site as we approach closure.” For Stroiazzo, the project is an example of good planning and use of easily available local materials, whether it be waste rock or fertilizer made from human excrement. “It established a methodology of using what you have, where you have it to minimize your impact to the environment in other ways,” he says. “There was a lot of clever thinking to bring this together at a reasonable cost.” With closure plans and remediation deposits mandatory just

Courtesy of Glencore Canada

COPPER & ZINC

The jarosite pond area before reclamation

about everywhere these days, Stroiazzo says the best practices learned at Kidd Metsite are valuable for Glencore Canada. And of course, there is the simple pride of being recognized for a job well done. With 32 years of experience in mine cleanup, Stroiazzo is used to working behind the scenes, although his cleanup project for another decommissioned Glencore site, the Gaspé copper mine in Murdochville, Quebec, also won an award in 2011. Still, he says, “These are big jobs. They take a lot of time and energy. They’re not always visible and to get recognition for projects like this is very satisfying.” CIM

October/Octobre 2014 | 35

Courtesy of Copper Mountain

Copper Mountain’s mission impossible Ore variability drives crushing capacity to extremes By Alexandra Lopez-Pacheco

Copper Mountain’s new primary crusher arrived in four main components totalling 260 tonnes.

n the summer of 2011, after four and a half years of meticulous planning and construction, Copper Mountain Corporation’s flagship mine near the town of Princeton, B.C. commenced production and began extracting ore from its five billion pounds of copper resource on its 18,000-acre site. Almost everything worked as projected with one daunting exception: the mill’s designed throughput rates were not being consistently met and were lower than anticipated. The missed target threw engineers for a loop. “We’d had a feasibility study and design done,” says the company’s president and CEO, Jim O’Rourke. “The grinding mill suppliers had been involved in it and given us a warranty of capacity, which was never met, and we had an independent consultant and a consulting firm working with us as well. We had a lot of people working on the design. It’s just that the rock didn’t react the way it was supposed to.” Based on the design and feasibility studies using samples from the site, the rock was supposed to go through the primary crusher, coming out of it in 5.5-inch chunks that would then go into the mine’s 34-foot diameter x 20-foot, 17,000 horsepower SAG Mill, producing a throughput rate of 35,000 tonnes per day. Instead, in the first quarter of 2013, the average throughput rate was 24,900 tonnes per day. Rather than rely on more rock samples, Copper Mountain installed cameras on the SAG mill feed conveyor to monitor the ore size as well as provide a 3D image of the ore entering the mill. The information provided by these cameras was very important because it demonstrated the inverse relationship between feed size and throughput. “It was very clear that when we had five percent or less of plus four-inch ore entering the mill, we were getting good tonnage, in fact, over design. But when the ratio of plus four-inch ore came up to about 30 per cent or so of the mill feed, the tonnage would drop way back,” recalls O’Rourke. The deposit has some very hard rock that instead of being crushed in the SAG mill was simply being worn down in size. Not willing to accept lower than predicted output, the mine’s team leaped into action and introduced several

36 | CIM Magazine | Vol. 9, No. 7

temporary measures to increase throughput. First, they implemented high-energy blasting in early 2013 to improve ore fragmentation and create more fines in the feed. But they also continued looking for a more effective and long-term solution. In March 2013, they tried something new: they ran a full-scale production test whereby 70,000 tonnes of ore was crushed to minus two inches in size using a contractor’s portable crusher to feed the SAG mill. “We achieved and surpassed design capacity,” says O’Rourke. “We then knew that finer crushing was the solution.” In early 2013, the mine contracted a temporary crushing unit to crush up to 7,500 tonnes per day of minus two-inch material. In August of that year, the mine purchased its own portable crusher and in December added a third crusher from a contractor. About 30 per cent of the feed going into the SAG mill was at that point crushed down to minus two inches in size with the portable crushers, resulting in its throughput rate increasing to 30,450 tonnes per day by the second quarter of 2014. However, there were two setbacks with these temporary measures: one was they could not handle 100 per cent of the total mill feed; the second was that the extra crushers cost $1.3 million a month. To achieve the targeted SAG mill throughput rate, Copper Mountain needed to install a permanent secondary crusher that could crush 100 per cent of the ore to minus two inches in size. It had to be a high-performance, massive crusher, capable of handling high tonnage. After completing an engineering study that confirmed viability of the secondary crusher, Copper Mountain chose the FL Smidth Raptor 2000, the largest cone crusher on the market, with technology that has been proven to be capable of handling applications like theirs. At the time, there were only two other such crushers installed in the world and the one at Copper Mountain would be the third.

Race against time and the odds Staff at Copper Mountain chose to directly manage all of the transportation and logistics themselves rather than outsource the delivery to the equipment supplier. “Freight

upfront COPPER & ZINC

Courtesy of Copper Mountain

forwarding options can The new Raptor 2000 crusher change very quickly as ves(left) supplies minus two-inch feed for the SAG mill. sels are available in different ports, and that window of opportunity is sometimes very short so you have to make very quick decisions,” says Walt Halipchuk, the company’s administration manager who, along with a team of two logistics specialists from Panalpina’s Pan Project group, worked long hours to co-ordinate every step from procurement to delivery. “We were able to reduce the decision-making process, review options and reply back within 24 to 48 hours, which is a huge advantage.” The company ordered the crusher on December 6, 2013. Only 30 days later, and over the Christmas holiday, the four main components; the lower main frame, which weighs over 100 tonnes, the upper main frame, the bowl short head and the adjustment ring – for a total combined weight of 260 tonnes – were trucked from the manufacturing plant in Bucharest, Romania to that country’s Port of Constanta. From there, the cargo was shipped over water to Venice, Italy. Rather than make Vancouver its destination, Halipchuk chose Halifax because the road trip between Vancouver and the mine site includes 35 bridges, all of which would have required bridgeload bearing calculations and engineering, given the cargo’s weight. By contrast, there are only 13 bridges between Kamloops and Princeton. So Halipchuk had the cargo shipped to the Maritimes and contracted CN Rail to handle the crosscountry transportation. All went well when the cargo with the four major components left Venice, but then a hurricane hit the Atlantic and the ship had to be diverted. Still, on Feb. 2, the crusher’s main components arrived safely in Nova Scotia. In late March, the cargo reached Kamloops via specialized rail cars and was put on a massive transport truck with 108 wheels ready to travel a carefully planned trip over four nights so as to minimize traffic disruption. “We had a whole traffic management plan and an engineer personally supervising every bridge crossing,” says Halipchuk. On March 18, during the final stretch, an unexpected hurdle developed: a road tension crack appeared from a slope failure caused by spring runoff on a two-lane section of the Provincial Highway 5A 45 kilometres north of Princeton. Copper Mountain responded rapidly, working with Ministry of Transport engineers, contract surveyors, civil and geo-technical engineers, the local aggregate supplier, trucking firms, road repair crews, traffic control services, and project management – and footing the bill. “It was a little bit like sending in the navy Seals,” Halipchuk says.

The repair work was completed on March 21 and the truck rolled by 15 minutes later, arriving in Princeton at 2:30 a.m., as originally scheduled. Since the crusher was built with parts from Romania, several U.S. states, Germany, China, and Canada, there were a lot more logistics involved. “The major components are all very exciting but you can’t overlook the smallest detail,” says Halipchuk. “So you go from these 260-tonne components to an electrical component that maybe weighs a pound but is equally important to the project. As they say, ‘For want of a nail.’”

Meanwhile, back at the site Between December to late March, construction management company Merit Consultants International Inc. was working to have all the preparation completed before the truck with the major crusher parts arrived. “Once we started receiving more equipment, we rounded up from about 15 people to 60 and worked 24 hours a day, seven days a week,” says Moe Theriault, Merit’s construction manager for the project. They erected the crusher building, installed the crusher using a large crane – no easy feat due to the weight of the parts – and revamped the conveyer system, including inserting a short transfer chute into the kilometre-long section. This was done with precise timing during a planned four-day shutdown of the primary crusher and with no disruption to the mill operations, as there was enough ore stockpiled to keep operating. By the end of July, just seven months after the start of construction, the $40-million secondary crusher was built on time and on budget, with testing and commissioning finalized in August. “There are always hiccups in construction, but when you have a great team, the team gets together and overcomes all the hiccups,” says O’Rourke. As Copper Mountain celebrates the completion of this latest ambitious mission, it has also uncovered another bit of great news: the deposit will support a mine life that is at least two years longer than estimated back in 2011. CIM October/Octobre 2014 | 37

An Introduction to Cutoff Grade: Theory and Practice in Open Pit and Underground Mines (with a new section on blending optimization strategy) Cutoff grades are essential in determining the economic feasibility and mine life of a project. Learn how to solve most cutoff grade estimation problems by developing techniques and graphical analytical methods, about the relationship between cutoff grades and the design of pushbacks in open pit mines, and the optimization of block sizes in caving methods. INSTRUCTOR Jean-Michel Rendu, USA • DATE September 3-5, 2014 • LOCATION Montreal, Quebec, Canada

Geostatistical Mineral Resource Estimation and Meeting the New Regulatory Environment: Step by Step from Sampling to Grade Control Learn about the latest regulations on public reporting of resources/reserves through state-of-the-art statistical and geostatistical techniques; how to apply geostatistics to predict dilution and adapt reserve estimates to that predicted dilution; how geostatistics can help you categorize your resources in an objective manner; and how to understand principles of NI 43-101 and the SME Guide. INSTRUCTORS Marcelo Godoy, Newmont Mining Corp., Denver; Jean-Michel Rendu, JMR Consultants, USA; Roussos Dimitrakopoulos, McGill University, Canada; and Guy Desharnais, SGS Canada Inc., Canada • DATE September 8-12, 2014 • LOCATION Montreal, Quebec, Canada

Strategic Risk Management in Mine Design: From Life-of-Mine to Mining Complexes • Find out how to manage and minimise risks and produce optimal pit designs with strategic mine planning processes and the next generation optimisation methods. • Discover how new developments will help you capture the “upside potential” in mine designs and minimise “downside risks” as well as increase cash flows through the effect of the mining sequence and “risk blending”. • Explore real-world examples and participate in hands-on computer sessions that show how to increase project value by employing new riskbased (stochastic) optimisation models. • Understand and learn about the new stochastic mine planning optimisation framework and its contribution to sustainable utilisation of mineral resources. • Discover new developments in optimizing mining complexes and mineral value chains. INSTRUCTORS Tarrant Elkington, Snowden, Australia; and Roussos Dimitrakopoulos, McGill University, Canada • DATE October 15-17, 2014 • LOCATION Montreal, Quebec, Canada

Quantitative Mineral Resource Assessments: An Integrated Approach to Planning for Exploration Risk Reduction Learn about exploration risk analysis for strategic planning. Understand how to demonstrate how operational mineral deposit models can reduce uncertainties; make estimates of the number of undiscovered deposits; and integrate the information and examine the economic possibilities. INSTRUCTORS Don Singer, USA; and David Menzie, U.S. Geological Survey, USA • DATE Postponed until 2015 • LOCATION Montreal, Quebec, Canada

Channelling the future Economist Patricia Mohr says a copper price rebound will take years but zinc is heating up

Courtesy of Patricia Mohr

By Virginia Heffernan

atricia Mohr, vice-president of economics and commodity market specialist at Scotiabank in Toronto, is known for her precision in predicting commodity prices. She is responsible for developing the Scotiabank Commodity Price Index, the first index designed to measure price trends for Canadian commodities in export markets. In 2013 she won the Metal Bulletin Apex Award for the most accurate gold and precious metal price forecasts of 2012. In mid-September, Mohr shared her views on the markets with CIM Magazine. She expects copper prices to remain stable or drop slightly over the next couple of years, with zinc taking its place as the base metal market darling.

CIM: What is driving the copper price this year? Mohr: Although copper prices are down from the record high in 2011 (US$4.65/lb), they remain quite profitable. I think we are beginning to get a cyclical lift-off in base metal prices, but copper is not going to be in the group that rallies in the next 18 months because there is still a lot of new mine supply coming on stream. At US$3.15 per pound, prices remain lucrative for most copper mining companies, yielding an average profit margin of 28 per cent over full break-even costs, including depreciation and interest on debt. CIM: What can we expect on the supply side for the rest of 2014 and into 2015? Mohr: There is another wave of mine supply that is about to come on stream including three new mines in Chile (Mina Ministro Hales, Caserones and Sierra Gorda), two in Peru (Toromocho and Las Bambas), one in B.C. (Red Chris), and a big mine in Zambia (Sentinel). There is a lot of new supply coming from both Zambia and the Congo, including greenfield projects and the ramping up of brownfield mines. There 40 | CIM Magazine | Vol. 9, No. 7

is a fair amount of brownfield expansion in the United States, and KGHM International plans to re-start the Afton Ajax mine in B.C. around 2019, so all in all, there is quite a lot of new supply coming our way. CIM: What about demand? Mohr: The demand for copper remains quite robust in China with consumption boosted by strong auto production and investments in high-speed rail and social housing. Despite all the negative sentiment about China’s economy, the reality is that they are still likely to get GDP growth of about 7.4 per cent this year. Yes, there is a correction in private sector residential construction, but China is offsetting that by expanding social housing – mostly apartment buildings – a big initiative that rarely gets discussed. In urban areas, the Chinese are tearing down whole shantytowns and replacing them with new housing and they are building new subways and rail lines. All of this activity is very copper intensive. Copper consumption in China will slow from 12 per cent growth last year, but it will still be more than 8.5 per cent. CIM: How much of global copper production is consumed in China? Mohr: China accounts for 46 per cent of world consumption of refined copper and that number is increasing slowly. By 2017, its share should be up to 47 per cent because it controls so much of the world’s manufacturing capability. In

upfront COPPER & ZINC

Europe, economic growth has been disappointing and even reversed in the second quarter. The United States is picking up steam and industrial activity is performing quite well there, but because of the economic shift that occurred over the past decade, the real demand driver remains China. CIM: What direction are copper inventories moving? Mohr: Inventories for refined copper are down about 50 per cent on the LME, COMEX and Shanghai Futures Exchange since late-2013. Demand growth is solid and there is a shortage of copper scrap around the world, so fabricators have had to shift to copper cathode. The prices have not been high enough to encourage a lot of scrap to come into the market. CIM: Labour disruptions have affected copper supply in the past. Do they continue to be a factor? Mohr: There haven’t been any major labour disruptions recently, but the Indonesian ban on the export of unprocessed minerals caused Freeport McMoRan and Newmont to suspend operations at the Grasberg and Batu Hijau mines respectively for a number of months. The Grasberg mine is operating again because Freeport reached a memorandum of understanding with the Indonesian government in July – under which an amended contract of work will be negotiated over the next six months – allowing the company

to export concentrates at a reduced export tax rate, though with higher royalties on copper and gold. Newmont is also working on an agreement, and I would expect it to receive a similar package. However, the Indonesians are quite serious about increasing processing in their country and the export duties are tied to smelter development in Indonesia. CIM: Are there other factors affecting the copper price? Mohr: General market sentiment on the economic outlook for China and global GDP growth are both very important in determining prices. The strength or weakness of the U.S. dollar is also important. Unfortunately, we expect a strengthening of the U.S. dollar in the next 18 months – not usually a positive for dollar-denominated commodity prices. CIM: What are your copper price forecasts for 2014, 2015 and the longer term? Mohr: I’m calling for prices to average US$3.16 per pound this year and to move to a US$3 per pound average next year. In terms of market interest, the baton will shift from copper to zinc in the next couple of years, and I expect very good performance from zinc. Later in the decade, I think copper prices are going to move back up resoundingly, but that will take a while. There is still a lot of new mine supply coming on stream that the market will need to absorb. CIM

October/Octobre 2014 | 41

Reverse engineering By Eavan Moore

Courtesy of Anglo American

The end result gives focus to geometallurgy programs

Core sample house at Pedra Branca do Amapari

HEN ROYAL NICKEL SET OUT TO DESIGN ITS DUMONT NICKEL DEVELOPMENT PROJECT IN QUEBEC, THE TEAM RECOGNIZED IT HAD A COMPLEX ORE BODY. “We knew that we really needed to understand the mineralogy, the alteration, and what was affecting recoverable minerals,” says project geologist Michelle Sciortino. An average recovery rate taken across the ore body could have misrepresented the deposit’s net present value and risked poor returns in the critical early years. So as part of its effort to de-risk the project, Royal Nickel undertook a four-year geometallurgy program to reach a better calculation – one that others in the field now see as an example of high-quality work in an increasingly important field. Geometallurgy has no agreed definition, but for Steve Williams, owner of the GeoMet Tech consultancy, it starts with a basic fact: Any mineral has an innate response to metallurgical processing, and geometallurgy is about understanding that response. Getting to that understanding and making effective use of it involves – at a minimum – having mine planners, geologists and metallurgists sit down and talk about their shared objectives. Typical geometallurgical work relies on numerous metallurgical samples, coupled with their mineralogical data, to build a block model of the ore body where domains are defined by their processing outcomes. The practice has taken on new urgency in the last decade in response to greater variability, complexity and remoteness of ore bodies. It has also acquired greater sophistication, thanks to new technology used to rapidly produce data and build three-dimensional models. More and more mining companies, under pressure from rising costs and newly preoccupied with waste, are working to institutionalize geometallurgy and its role in risk management. In some ways the approach of geometallurgists today is reminiscent of the mid-20th century and the interdisciplinary training of geology; mining and metallurgical teams focused on value before increasing volumes of data and sophistication of analysis encouraged greater specialization, argues Karin Olson Hoal, consultant and research professor at the Colorado School of Mines. Today, with the demands to mine more effectively and sustainably, geometallurgy has become a major research initiative in its own right, with university professorships, programs, students and labs.

Dumont nickel characterization Sciortino attributes the smooth execution of the geometallurgy program for the Dumont project to interdisciplinary work. As a geologist, she spent time not only looking at rocks in the core, but also coordinating the sampling effort for mineralogical characterization and then directly planning the metallurgical program with Royal Nickel’s vicepresident of operations, Johnna Muinonen. The Royal Nickel team focused on three minerals: the sulphides pentlandite and heazelwoodite, and the ferronickel awaruite. After plotting nickel and sulphur against rougher recovery and turning up no meaningful relationship, the Dumont team dug deeper into data generated for them by SGS using FEI’s QEMSCAN (quantitative evaluation of minerals by scanning electron microscopy), one of several commercially available systems that scan samples and automatically characterize their mineralogical properties. October/Octobre 2014 | 43

Successful geometallurgy programs set their goals with the saleable product in mind and work backwards. One QEMSCAN program using 1,420 1.5-metre core samples gave a broad overview of variability across the ore body. A second set of 105 15-to-20-metre samples was subjected both to metallurgical tests and to a more detailed QEMSCAN analysis. The mineralogy showed which sulphide domains were heazelwoodite dominant, pentlandite dominant, or mixed; metallurgical tests showed the nickel recovery rates for each. An electron microprobe – which operates on the same electron bombardment principle included in QEMSCAN but at a higher resolution – identified the nickel tenor within minerals, showing for example the high-nickel versus low-nickel pentlandite, which proved important for understanding the concentrate grade. “The work we’ve done has given us a lot more confidence in understanding the recovery of the ore body and the ability to maximize value from that ore body, by processing the higher-value material first,” says Muinonen. “The Dumont deposit is fairly uniform in nickel grade throughout, but that nickel recovery can vary from 20 per cent to 80 per cent, which leads to very different ore value in different areas. Without knowing where the higher-value material is and trying to process it as early as possible, Dumont may not have gone past the prefeasibility study completed in 2011.”

Risk management for juniors It is all about de-risking, according to Doug Hatfield, technical manager of development at SGS Lakefield. Mine proponents want to accurately predict recoveries, limit capital expenditures and attract investors; operations in later stages want to manage production volumes and maximize profitability. Geomet is “not exactly in its infancy,” comments Hatfield. “It’s in its teenage years.” Not only do mining companies accept it more widely, investors are also becoming more aware. “They’re becoming more risk-averse, they understand risk better, and I think the cowboy days of the California gold rush are over,” says Hatfield. “No one throws money at a project 44 | CIM Magazine | Vol. 9, No. 7

without a reasonable quantified probability of return.” He believes that could put pressure on junior companies that might otherwise hesitate to invest in geometallurgical studies. Inevitably, the added scrutiny will mean some projects are non-starters. That may be bad news for project proponents but a step forward for the industry as a whole. For example, a project SGS worked on showed that the ore would have become so hard after five years of mining that the project was not viable. “To understand how this relates specifically to geomet, it must be compared with the traditional project assessment technique, which is to test a blended bulk composite ore sample,” Hatfield explains. “If an over-blended composite was tested for hardness, it would have shown reasonable performance since the extremely hard material could have been mixed with softer material from the earlier years of the life of mine. The project may have gone ahead based on this approach.” Mike Bandrowski, a base metals analyst at Clarus Securities who covers Royal Nickel, agrees that investors should demand that management teams minimize processing risk to the best of their ability. “But keep in mind that financial constraints often limit junior mining companies,” he cautions. Metallurgical work does not necessarily raise stock prices. Junior miners tend to gather what little money they have to drill more holes instead, which Bandrowski feels can be an expensive mistake if it fails to de-risk the project. Metallurgical work – which at Dumont cost $1,000 to $1,200 for each metallurgical sample and $500 for each mineralogical sample – costs “nothing” in the context of a mine costing hundreds of millions of dollars. Bandrowski lauds the work done at Dumont: “We believe the geometallurgical work is extremely important, and when properly done it can be invaluable to the project at hand.” Dumont’s results, particularly the varying degrees of serpentinization leading to different nickel tenors, gave him greater confidence that the process plant would be able to produce a steady quality of concentrate. However, he warns, “The capital budget, financing risk and commodity prices will truly determine the Dumont’s internal rate of return. Their feasibility study was done at $9 nickel. At the end of the day, if the commodity prices aren’t there, the project doesn’t get built.” In mid-September, nickel was selling at around US$8.28 per pound.

Courtesy of Anglo American

Courtesy of Antofagasta

Left to right:Copper cathodes; copper pour; Flotation

Courtesy of Anglo American

Courtesy of Antofagasta

Left to right: Blasting at El Tesoro; Los Bronces project in Chile; a geologist examines copper in the Chilean Andes

Production management for mines

Faster, cheaper mineralogy Whatever its motivations, Royal Nickel could not have run its geomet program quickly or cost-effectively enough to work before the advent of scanning electron microscopes and faster Graphic courtesy of Aukje Benedictus, and Snezana Bajic, FEI

A junior’s attempt to trim risk from an early-stage of project is just one opportunity for geometallurgical work. Major mining companies are much more likely to do extensive geometallurgical work, since they already have the cash flow to fund it. The most advanced work has occurred in large porphyry copper operations in South America, making copper one of the bestunderstood ores for a geometallurgical program. Iron ore, as another industry characterized by high-volume, well-funded operations, has also received attention. “Gold is still difficult,” says Williams. “Ultimately it’s about gold deportment, and that can be complex. And it’s not readily measured by mineralogy at the moment. You have to do detailed gold deportment studies, which are nowhere near as rapid as a base-metals QEMSCAN study.” Successful geomet programs set their goals with the saleable product in mind and work backwards. For example, one iron ore client of SGS uses hardness data to tune its seasonal output: harder ores are processed when customer demand is low and

softer ores when it is high. Another major producer considered 11 different flowsheets for its copper-molybdenum operation before deciding in favour of a novel circuit designed to retrieve molybdenum from column tails when more difficult ore is processed. Some companies are able to predict variability in production rates on a day-to-day, month-to-month, or year-toyear basis, based on what is understood about the ore coming down the conveyor. Will Goodall, principal consultant at MinAssist in Australia, remarks that the grade engineering work done via the CRCORE project at the University of Queensland has offered a more unusual example of geometallurgical thinking. It finds more sophisticated distinctions between ore and waste – for example, using hardness as a cut-off rather than grade.

The tools exist to collect sufficiently refined data such as the nature of the chalcopyrite losses during rougher flotation. The task is now to apply this data to the fullest to improve metallurgical performance. October/Octobre 2014 | 45

computing speeds. Twenty years ago, the electron microscopy would have been done by hand. Today’s technology – in particular, the small-scale tests of hardness and grindability – has to date favoured comminution applications, but flotation and leaching tests are also improving in cost and effectiveness, according to Olson Hoal. In general, says Goodall, the newer tools include small-sample (and therefore relatively cheap) tests to produce Bond Work Index crushability values. He adds that a number of companies enjoy exclusive use of innovations as sponsors of the research organization AMIRA International’s Geometallurgical Mapping and Mine Modelling (GeM) series of projects. QEMSCAN and other quantitative mineralogy systems generate large datasets with particle size, mineral associations, and so on. The final level of sophistication includes electron microprobes, which revealed nickel tenor at Dumont and also come in handy for identifying sub-micron gold in refractory ores.

FLSmidth, “some plants start up which have not had very thorough geomet programs, and they either fail to make throughput or they fail to make final recovery of the metal, or a combination of both.” Even at larger companies, geomet initiatives have tended to take place on a project-by-project basis. Goodall believes that at the current stage, efforts to coordinate across sites and provide useful benchmarking depend on a champion. If that individual leaves, “it falls to pieces.” The latest effort to centralize geometallurgy comes from Anglo American, where John Vann, group head of geosciences since last March, has reorganized the corporate geoscience function to support post-discovery work. He is currently recruiting a three-position geometallurgy team. “We are at the beginning of a journey trying to coordinate geomet at a higher level inside Anglo American,” he comments, noting that geometallurgy is a fundamental business process that affects every aspect of operations from blasting to tailings. The personnel he seeks would be “professional catalysts” who can connect geology, planning, processing and sustainability. Coordinating between diverse disciplines requires a shared Now that the tools exist to collect sufficiently refined data, language – and companies commonly use the indicators most the question becomes: What to do with it? Goodall was tapped closely aligned with dollar signs, avoiding department-specific to develop the next round of AMIRA research looking at lingo. Within Anglo American Copper, mining geology manager answering that question. For example, how are geometallurgical Sergio Spichiger says that instead of talking about variability parameters from different fields of research best reconciled? and uncertainty, the engineers in the plant discuss “understandWhat is the best way to relate them to the block model? But ing of the risks” or “adding value” when they want to commuamid both a downturn and a debate over the value of geomet- nicate across silos. At another South American development allurgy and how to quantify it, companies have hesitated to project that Hatfield worked on, the production forecast was fund GeM III. the key to communication. SGS used the mine plan it was given If geometallurgy has failed to gather momentum within min- to generate a production forecast, which provided feedback to ing companies, it may be due in part to examples of botched the geologists and mine planners and was used to calculate revimplementation. Geometallurgical testwork is an increasingly enue, offering a bridge between the diverse specialties of the common part of feasibility studies, but cash-strapped compa- project team and head office. nies still skimp on it by taking a small number of samples or Consulting and engineering firms with geometallurgical overblending their composites. “As a consequence,” says David expertise play pivotal roles for clients without in-house capaMeadows, vice-president of global process technology for bilities. While in theory this may not be the ideal arrangement, mining companies are hard-pressed to rediscover the holistic mining engineering A tale of two commissionings approach of the previous century. When so few professionals have cross-trained over the last 30 years, finding the right catalysts is a difficult task. “Companies just don’t know where the skills are going to come from,” says Goodall. “We need people who can understand the full system of mining rather than every little silo.” For example, the kinds of management skills needed include retooling the entire operation’s key performance indicators – if a site is newly implementing a geomet program, it is almost certain that their current KPIs will not suit. Rather than grade and tonnage from the mine, recovery from the mill, and so on, the entire operation needs to be working toward an end Months since commissioning period result such as revenue or concentrate quality. The graph shows the outcomes of a pair of copper concentrator projects in Africa. One, which “Those are the soft issues of geometallurgy,” reached design capacity in less than a year, “represents proper sampling geometallurgy and process comments Goodall. “We haven’t started to design,” explains FLSmidth’s David Meadows. The other does not. address them yet.” CIM Per cent of design feedrate

Courtesy of FLSmidth

Implementing geomet programs

46 | CIM Magazine | Vol. 9, No. 7

Avec l’aimable autorisation d’Anglo American

Coulée de cuivre

L’ingénierie inverse Les programmes de géométallurgie suscitent un intérêt grandissant

ORSQUE LA SOCIÉTÉ ROYAL NICKEL S’EST LANCÉE DANS LA CONCEPTION DE SON PROJET DE DÉVELOPPEMENT NICKÉLIFÈRE DUMONT AU QUÉBEC, L’ÉQUIPE A RECONNU QUE LE CORPS MINÉRALISÉ QU’IL CONTENAIT ÉTAIT COMPLEXE. « Nous avons réalisé qu’il nous fallait bien comprendre la minéralogie, l’altération et les éléments qui affectaient les minéraux récupérables », explique Michelle Sciortino, géologue du projet. Le taux moyen de récupération calculé sur l’intégralité du corps minéralisé pourrait avoir donné une fausse impression de la valeur actualisée nette du gisement et aurait pu entraîner des rendements médiocres durant les premières années décisives du développement. Ainsi, dans le but de réduire les risques associés au projet, Royal Nickel a entrepris un programme de géométallurgie sur quatre ans afin de parvenir à des calculs plus précis. Aujourd’hui, ce programme est considéré par d’autres sociétés de l’industrie comme un exemple de travaux de grande qualité dans un domaine qui devient de plus en plus important.

Par Eavan Moore

On ne dispose aujourd’hui d’aucune définition précise de la géométallurgie, mais pour Steve Williams, propriétaire de la société d’experts-conseils GeoMet Tech, tout commence par un fait fondamental : tout minéral réagit naturellement au traitement métallurgique, et la géométallurgie implique de comprendre cette réaction. Pour la comprendre et en faire bon usage, il faudra, au strict minimum, que les planificateurs de la mine, les géologues et les métallurgistes se réunissent et discutent de leurs objectifs communs. Les travaux géométallurgiques classiques consistent à associer plusieurs échantillons métallurgiques à leurs données minéralogiques afin de développer un modèle de blocs du corps minéralisé pour des domaines qui sont définis par leurs résultats en matière de traitement. Ces dix dernières années, cette pratique a revêtu une importance croissante étant donné la variabilité et la complexité grandissantes des corps minéralisés ainsi que l’accès difficile à ces derniers. Elle est aussi devenue plus sophistiquée grâce aux nouvelles technologies permettant de générer des données rapidement et de construire des modèles tridimensionnels. La October/Octobre 2014 | 47

hausse des coûts et les récentes préoccupations concernant les déchets miniers imposent une forte pression sur les sociétés minières, aussi elles œuvrent à institutionnaliser la géométallurgie et son rôle dans la gestion des risques. À certains égards, l’approche qu’adoptent les géométallurgistes aujourd’hui n’est pas sans rappeler le milieu du XXe siècle et l’apprentissage interdisciplinaire de la géologie. Comme l’explique Karin Olson Hoal, conseillère et professeure de recherche à la Colorado School of Mines, les équipes spécialisées dans les mines et la métallurgie se concentraient sur la teneur avant que la masse croissante de données et la complexité des analyses ne les encouragent à se spécialiser davantage. Aujourd’hui, l’extraction du minerai se doit d’être plus efficace et plus durable, aussi la géométallurgie est devenue une importante discipline scientifique à part entière à laquelle ont été dédiés des chaires universitaires, des programmes, des cursus d’études et des laboratoires.

La caractérisation du nickel selon Dumont D’après Mme Sciortino, l’exécution homogène du programme de géométallurgie pour le projet Dumont est attribuable aux travaux interdisciplinaires. En tant que géologue, elle a passé beaucoup de temps non seulement à étudier les roches des carottes de sondage mais aussi à coordonner l’échantillonnage pour la caractérisation minéralogique et à planifier directement le programme métallurgique avec Johnna Muinonen, vice-présidente des opérations de Royal Nickel. L’équipe de Royal Nickel s’est concentrée sur trois minéraux : la pentlandite (ou nicopyrite) et le disulfure de trinickel (ou heazlewoodite), tous deux des sulfures, et l’awaruite, du ferronickel. Le processus de récupération par dégrossissage a permis de détecter du nickel et du soufre, mais l’équipe de Dumont n’est parvenue à établir aucune relation concluante entre les taux de récupération de ces deux minéraux, aussi elle a creusé plus loin dans les données générées à leur intention par SGS à l’aide du système QEMSCAN de FEI (évaluation quantitative des minéraux par microscopie électronique à balayage), l’un des systèmes commercialisés qui scannent les échantillons et caractérisent automatiquement leurs propriétés minéralogiques. L’un des programmes de QEMSCAN s’est basé sur 1 420 carottes de sondage de 1,5 mètre pour fournir une vue d’ensemble générale de la variabilité de l’intégralité du corps minéralisé. Une deuxième série de 105 échantillons de 15 à 20 mètres a été soumise à des essais métallurgiques et à une analyse plus poussée par le système QEMSCAN. Les données minéralogiques ont montré les zones de sulfure contenant une prédominance de disulfure de trinickel, de pentlandite ou des deux combinés ; les essais métallurgiques ont montré les taux de récupération du nickel pour chacun d’eux. Une microsonde électronique, qui fonctionne sur le même principe de bombardement d’électrons qu’utilise le système QEMSCAN mais à une résolution plus élevée, a permis d’identifier la teneur en nickel au sein des minéraux, révélant par exemple la pentlandite à haute teneur et celle à basse teneur en nickel, ce qui a permis de comprendre la teneur du concentré de minerai. « Grâce aux travaux que nous avons menés, nous sommes maintenant capables de mieux comprendre la récupération du 48 | CIM Magazine | Vol. 9, No. 7

corps minéralisé et d’optimiser la teneur à partir de ce corps minéralisé en transformant en premier lieu le matériau affichant la plus haute teneur », explique Mme Muinonen. « L’ensemble du gisement de Dumont est relativement homogène en termes de teneur en nickel, mais la récupération de ce nickel peut varier de 20 à 80 %, ce qui aboutit à des teneurs très différentes dans le minerai extrait dans différentes zones. Si l’équipe de Dumont n’était pas parvenue à déterminer où se trouvait le matériau affichant la plus haute teneur et à le traiter dès que possible, le projet Dumont aurait bien pu ne pas dépasser le stade de l’étude de préfaisabilité réalisée en 2011. »

La gestion des risques pour les petites sociétés minières D’après Doug Hatfield, directeur technique du développement chez SGS Lakefield, il faut avant tout réduire les risques. Les promoteurs miniers désirent prévoir de manière précise les récupérations, limiter les dépenses en capital et attirer des investisseurs ; les exploitations se trouvant à des étapes avancées souhaitent gérer leurs volumes de production et optimiser la rentabilité. La géométallurgie n’en est « pas exactement à ses balbutiements », indique M. Hatfield. « On pourrait dire qu’elle est au stade de l’adolescence. » Non seulement les sociétés minières l’acceptent davantage, mais les investisseurs y deviennent plus sensibles. « Ils deviennent davantage réticents à prendre des risques et les comprennent mieux ; je pense aussi que l’époque des cowboys de la ruée vers l’or en Californie est révolue », indique M. Hatfield. « De nos jours, plus personne n’investit d’argent dans un projet sans avoir obtenu de quantification raisonnable de la probabilité de rendement. » Selon lui, cela pourrait inciter les petites sociétés minières hésitant encore à investir dans des études géométallurgiques à les envisager. Inévitablement, l’examen minutieux auquel sont de plus en plus soumis les projets implique que certains ne pourront aller de l’avant. Il s’agit peut-être d’une mauvaise nouvelle pour les promoteurs de projets, mais c’est un grand pas en avant pour l’industrie dans son ensemble. Par exemple, dans l’un des projets sur lequel a travaillé SGS, le minerai était devenu si dur après cinq années d’exploitation que le projet n’était pas viable. « Pour comprendre comment cela est spécifiquement lié à la géométallurgie, il faudra la comparer à une technique traditionnelle d’évaluation d’un projet, qui consiste à tester un échantillon de matériau composite brut formé par un mélange de minerai », explique M. Hatfield. « Si l’on avait testé un matériau composite formé par un mélange de plusieurs qualités de minerai pour déterminer sa dureté, il aurait affiché une performance raisonnable étant donné que le matériau extrêmement dur aurait pu être mélangé avec un matériau plus meuble des années antérieures de la vie de la mine. Le projet aurait pu se poursuivre sur la base de cette approche. » D’après Mike Bandrowski, analyste des métaux communs chez Clarus Securities, courtier de Royal Nickel, les investisseurs devraient exiger des équipes de direction qu’elles minimisent le risque lié au traitement au mieux qu’elles le peuvent.

« Mais gardez bien à l’esprit que les contraintes financières limitent souvent les petites sociétés minières », prévient-il. Les travaux métallurgiques ne contribuent pas nécessairement à la hausse du cours d’une action. Les petites sociétés minières ont tendance à plutôt rassembler le peu d’argent dont elles disposent pour forer d’autres trous, ce qui, selon M. Bandrowski, peut représenter une erreur coûteuse si cela ne contribue pas à réduire les risques associés au projet. Les travaux métallurgiques qui, pour le projet Dumont, coûtent entre 1 000 et 1 200 $ par échantillon métallurgique et 500 $ par échantillon minéralogique, ne représentent « rien » pour une mine qui coûte des centaines de millions de dollars. M. Bandrowski félicite les travaux réalisés dans le cadre du projet Dumont. « Les travaux géométallurgiques sont extrêmement importants, et lorsqu’ils sont menés dans les règles de l’art, les résultats se révèleront précieux pour le projet concerné. » Les résultats qu’affiche Dumont, et notamment les divers degrés de serpentinisation menant à différentes teneurs en nickel, viennent confirmer que l’usine de traitement pourrait bien être en mesure de produire une qualité régulière de concentré de minerai. Cependant, M. Bandrowski prévient que « le budget d’investissement, le financement des risques et les prix des marchandises détermineront réellement le taux de rentabilité interne (TRI) de Dumont. L’étude de faisabilité du projet avait tablé sur un prix hypothétique du nickel à 9 $ US la livre. Au final, si les prix des marchandises ne suivent pas, le projet ne se poursuivra pas. » Mi-septembre, le nickel se vendait à environ 8,28 $ US la livre.

La gestion de la production pour les mines Les travaux géométallurgiques peuvent se révéler intéressants pour une petite société minière qui tente de réduire les risques dès le début du projet. Les grandes sociétés minières sont bien plus susceptibles de mener des travaux géométallurgiques plus poussés étant donné qu’ils disposent déjà du flux net de trésorerie pour les financer. Les travaux les plus avancés ont eu lieu dans de grandes exploitations de cuivre porphyrique en Amérique du Sud, faisant du cuivre l’un des minerais les mieux compris pour un programme géométallurgique. Le minerai de fer, une autre industrie caractérisée par des exploitations disposant d’un bon financement et gérant de gros volumes, a également suscité un grand intérêt. « L’or présente encore des difficultés », explique M. Williams. « Tout réside dans le comportement de l’or en définitive, et cela peut s’avérer complexe. La minéralogie ne permet pas de le mesurer facilement. Il faut mener des études complètes sur le comportement de l’or, qui sont considérablement plus longues que l’étude QEMSCAN. » Les programmes concluants de géométallurgie sont ceux qui établissent leurs objectifs en gardant à l’esprit le produit vendable, et qui évoluent à partir de ce point. Par exemple, un client de SGS spécialisé dans le minerai de fer utilise des données sur la dureté pour ajuster son rendement saisonnier : les minerais les plus durs sont traités lorsque la demande des clients est faible, et les minerais plus meubles le sont quand les demandes sont plus fortes. Un autre grand producteur a étudié 11 schémas de traitement différents pour son exploitation de cuivre-molyb-

dène avant d’opter pour un circuit innovant permettant de récupérer le molybdène à partir des rejets des colonnes lors du traitement de minerai plus complexe. Certaines sociétés peuvent prévoir la variabilité des taux de production sur une base quotidienne, mensuelle ou annuelle en fonction de leur degré de compréhension du minerai sortant du convoyeur. Will Goodall, conseiller principal chez MinAssist en Australie, fait remarquer que les études techniques menées sur la teneur au titre du projet CRC-ORE à l’université du Queensland ont fourni un exemple moins commun du raisonnement géométallurgique. Ces études établissent des distinctions plus complexes entre le minerai et les déchets, par exemple en utilisant la dureté en tant que teneur de coupure et non pas en tant que teneur de tête.

Une minéralogie plus rapide et moins coûteuse Quelles que soient ses motivations, Royal Nickel n’aurait pu mener son programme de géométallurgie avec la même rapidité et rentabilité avant l’arrivée sur le marché des microscopes électroniques à balayage et sans les vitesses de calcul actuelles. Il y a vingt ans, la microscopie électronique aurait été effectuée manuellement. D’après Mme Olson Hoal, la technologie actuelle, et en particulier les essais à petite échelle sur la dureté et la broyabilité, a jusqu’à présent privilégié les applications de comminution, mais le coût et l’efficacité des essais de flottation et de lixiviation s’améliorent petit à petit. De manière générale, explique M. Goodall, les instruments les plus récents incluent des essais effectués à l’aide de petits échantillons (d’où leur faible coût) pour générer des valeurs de l’indice de broyabilité de Bond. Il ajoute qu’un certain nombre de sociétés bénéficient d’un usage exclusif des innovations en tant que commanditaires de la série de projets Geometallurgical Mapping and Mine Modelling (GeM, projets dédiés à la cartographie géométallurgique et la modélisation des mines) de l’organisme de recherche AMIRA International. QEMSCAN et d’autres systèmes minéralogiques quantitatifs génèrent de vastes ensembles de données portant sur la taille des particules, les associations minérales et ainsi de suite. Le tout dernier niveau de sophistication comprend des microsondes électroniques, qui ont permis de déceler les teneurs en nickel dans le projet Dumont et s’avèrent également très utiles pour l’identification des particules submicroscopiques d’or dans les minerais réfractaires.

La mise en œuvre des programmes de géométallurgie Maintenant que nous disposons des outils nécessaires pour recueillir des données suffisamment pointues, la question est de savoir ce que nous allons en faire. M. Goodall a été chargé de développer la prochaine série de travaux de recherche d’AMIRA dans le but de répondre à cette question. Par exemple, comment concilier au mieux les paramètres géométallurgiques de différents domaines de recherche ? Quel est le meilleur moyen de les rattacher au modèle de blocs ? Cependant, dans le contexte du ralentissement économique et du débat sur la October/Octobre 2014 | 49

valeur de la géométallurgie et la manière de la quantifier, les sociétés ont hésité à financer le projet GeM III. Si la géométallurgie n’a pas gagné de terrain auprès des sociétés minières, cela pourrait en partie s’expliquer par des tentatives bâclées de mise en œuvre. Les essais géométallurgiques deviennent de plus en plus courants dans les études de faisabilité, mais les sociétés à court d’argent lésinent encore et préfèrent prendre de petites quantités d’échantillons ou mélanger plusieurs qualités de minerais pour leurs matériaux composites. « Ainsi », explique David Meadows, vice-président des technologies de système à l’international pour FLSmidth, « certaines usines de traitement se lancent sans avoir bénéficié de programmes complets de géométallurgie et elles ne parviennent pas à atteindre la capacité souhaitée ou à récupérer le métal au final, et parfois ni l’un ni l’autre ». Même dans de plus grandes sociétés, les initiatives de géométallurgie ont tendance à être menées en fonction de chaque projet. Selon M. Goodall, à ce stade, il faudra un champion pour coordonner les efforts menés dans tous les sites et établir des comparaisons utiles. Si ce champion quitte le projet, « tous les efforts seront réduits à néant ». La toute dernière tentative de centraliser la géométallurgie est l’œuvre d’Anglo American, où John Vann, responsable des sciences de la terre depuis mars dernier, a réorganisé la fonction interne de cette discipline pour soutenir les travaux suivant la découverte. Actuellement, il recrute une équipe de trois personnes spécialisées en géométallurgie. « Nous commençons un long périple dans l’espoir de coordonner la géométallurgie à un niveau plus élevé au sein d’Anglo American », explique-t-il, ajoutant que la géométallurgie est un processus opérationnel fondamental qui affecte tous les aspects des activités, de l’abattage à l’explosif aux résidus. Il est à la recherche de personnes qui seraient des « catalyseurs professionnels » capables de mettre en relation la géologie, la planification, le traitement et la durabilité. La coordination entre plusieurs disciplines requiert de parler la même langue ; les sociétés ont la plupart du temps recours aux indicateurs qui se rapprochent le plus de la valeur financière et évitent les jargons spécifiques à chaque discipline. Au sein d’Anglo American - Copper, le responsable de la géologie minière Sergio Spichiger explique que les ingénieurs dans l’usine ne parlent pas de variabilité et d’incertitudes, mais plutôt de « comprendre les risques » et d’« ajouter de la valeur » lorsqu’ils communiquent d’un silo à l’autre. Dans un autre projet de développement en Amérique du Sud sur lequel a travaillé M. Hatfield, les prévisions concernant la production ont été essentielles à la communication. SGS s’est servie du plan de la mine qu’elle a reçu pour générer une prévision de la production. Elle a ainsi pu fournir des renseignements aux géologues et aux planificateurs de la mine qui leur ont permis de calculer les revenus et ainsi de rapprocher les spécialités multiples de l’équipe du projet et le siège social. Les sociétés d’experts-conseils et d’ingénierie ayant de l’expérience en géométallurgie sont indispensables aux clients ne disposant pas des capacités en interne. En théorie, ce n’est pas la meilleure disposition, mais les sociétés minières ont beaucoup de mal à redécouvrir l’approche holistique du génie minier du siècle dernier. Tellement peu de professionnels ont reçu une formation polyvalente ces 30 dernières années qu’il est difficile de trouver les meilleurs catalyseurs. 50 | CIM Magazine | Vol. 9, No. 7

« Les sociétés ne savent tout simplement pas d’où vont venir les compétences », indique M. Goodall. « Nous avons besoin de personnes qui peuvent comprendre l’intégralité du système minier et non pas uniquement chaque petit silo. » Les compétences requises en matière de gestion comprennent par exemple le renouvellement des indicateurs de rendement clé (IRC) de toute l’exploitation. Si un site met en œuvre un programme de géométallurgie pour la première fois, il est pratiquement certain que les IRC qu’il utilise ne seront pas adaptés. Plutôt que se concentrer sur la teneur et le tonnage de la mine, la récupération dans le concentrateur et ainsi de suite, l’exploitation doit être orientée sur un résultat final tel que les revenus ou la qualité du concentré de minerai. « Ce sont les questions annexes de la géométallurgie », explique M. Goodall. « Nous ne les avons pas encore abordées. » ICM

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EQUIPMENT MONITORING

By Eavan Moore

Courtesy of ABB

While few mine sites in Canada have adapted the technology, gearless drives meet the need for efficiency and increasing volume in today’s mines.

In a gearless mill drive, the stator of the motor wraps directly around the mill.

52 | CIM Magazine | Vol. 9, No. 7

Removing the gearbox

here is one very good reason to install a gearless drive on a belt conveyor or tumbling mill: The size of mining equipment has outstripped the ability of gear systems to deliver enough power. The fragile steel teeth of a complex gearbox system can handle up to about 16 megawatts (MW) on a grinding mill application, but after that a drive system that obviates any need for gears is the only practical choice. The gearless design for drive systems – first used in a mill in 1969 and then a belt conveyor in 1986 – has come into its own since the early 1990s, as an industry that is processing ever greater throughputs has demanded larger and more powerful equipment. Each increase in mill size has necessitated a larger drive design. Moreover, in the last 10 years, ABB and Siemens, the top two producers of gearless drives, have steadily improved their product’s reliability and availability.

The basic principle behind a gearless drive is that it directly connects the motor to the driven equipment. Timo Roesch, senior sales engineer at Siemens, explains that a gearbox is usually needed to reduce the fixed motor speed of a standard electric motor of 1,200 or 1,800 revolutions per minute – when operated at a 60 Hertz frequency network like in Canada – to the equipment speed. On a belt conveyor, for example, the drive pulley usually runs at 50 to 70 revolutions per minute. Siemens and ABB manufacture a type of motor designed to run at the speed of the driven equipment. Each installation is custom engineered and more cost intensive than a conventional motor, but it allows the mine to do away with the gearbox and couplings. Gearless drives are found in a number of equipment types including hoists, excavators, slurry pumps and draglines. Their most well-known use, however, has taken place in tumbling mills and belt conveyors where the designs integrate the motor with the equipment. In a conventional large ore conveyor, the standard motor connects via couplings to the gearbox with several gear stages and then to the drive pulley. But in a gearless conveyor, the motor connects directly to the pulley drive. In a gearless mill drive, the stator of the motor wraps right around the mill. The rotor poles are attached directly to the mill flange, essentially making the mill itself the turning rotor. Gearless systems are universally variable speed, allowing the mill speed to be adjusted to the operation requirements at any time across the full operating range. This makes for smoother starts, stops and changes. Variable-speed controls allow gearless mills to respond flexibly to

The motor of a gearless conveyor connects directly to the pulley drive.

Courtesy of Siemens

changes in throughput and ore hardness, switch rotational direction to get a more even wear on the liner, and run at a speed optimized for energy saving.

Conventional gears have limited strength; overload them and their steel teeth start to break. “For large mills, you already need two motors and two gearboxes arranged on each side in order to bring some 16 MW to the mill,” says Roesch. “All these conventional arrangements get to the limit of their mechanical robustness. That’s why we look at the components that are at the edge of their power and torque limits, which are the gearboxes and pinion and so on, and take them out and just attach the motor directly to the mill.” In a conveyor application, gearless technology means that conveyors can be longer and stronger, with fewer and smaller drive stations. The other top two reasons mines select gearless drives are their relatively high availability and energy efficiency. Because there are fewer fragile moving parts, gearless drives experience less maintenance downtime. A geared drive would need to be lubricated regularly and fixed more frequently. Roesch says Siemens’ gearless drives themselves have an availability of more than 99 per cent. Taking the entire mill into account, a typical gearless-driven mill availability would be minimum 95 per cent, according to Roesch. “Typical conventional drive systems achieve two to 2.5 per cent less,” he says. “So there’s usually at least two per cent of difference in availability, which is more than 160 hours per year. With 160 hours at $100,000 in throughput per hour, you are already at $16 million yearly additional revenue.” Gearless drives also offer an energy-efficiency advantage. The losses to heat incurred by geared drive systems add up to nine per cent, while gearless drives lose only 4.5 to five per cent. Roesch notes that energy efficiency interests miners more than it used to, especially in high-cost South America. Chile, which represents the biggest single market for gearless drives, says Roesch, has experienced an annual 11 per cent climb in energy cost since 2000. That is not the only reason South America is a hotspot for gearless technology. Sachin Jari, group manager for mining at ABB’s Montreal office, notes that once a few operations get started, their neighbours feel more confident in copying them. “People in South America are very comfortable with this technology,” says Jari. “There’s good know-how.” In Canada, by contrast, only two mine sites have installed gearless mill drives so far: the Canadian Malartic site co-owned by Agnico Eagle and Yamana Gold, and the Mt. Milligan mine that Thompson Creek Metals put into production in 2013. “What [Canadian mine operators] haven’t seen yet, they’re usually reluctant to install,” says Roesch. “From our perspective, considering the total costs of ownership, it could be a very good

Courtesy of Siemens

Advantages of going gearless

The availability of

idea for the end customer to think about a typical gearless mill drive is at going gearless.” least 95 per cent. As more mine operators plan for high throughputs in response to lower-grade ores, use of large gearless-driven equipment will likely rise. At least two more sites in Canada plan to use gearless mills in their process plants. Royal Nickel’s Dumont project in northern Quebec, slated to start commissioning in 2016, plans to go gearless with its SAG mill, according to Johnna Muinonen, vice-president of operations at the company. “Our plan contemplates a 21 MW SAG mill,” she says. “To my knowledge, there are no geared drives powering a 21 MW SAG mill currently in operation. Our capital equipment was chosen with a focus on using existing, proven technology at the size we require, which, for our SAG mill, led to the gearless drive decision. We would also get the greater flexibility – for example, speed control range and frozen charge control – as well as the slightly higher energy efficiency of the gearless drive.” Western Copper and Gold Corp. will also use a gearless SAG mill at its polymetallic Casino deposit in Yukon, which October/Octobre 2014 | 53

released a feasibility study in 2013 estimating throughput of 120,000 tonnes per day. Cam Brown, vice-president of engineering, was involved in the first gearless installation in North America in 1989, and he has supported the technology since. He says his company has already selected Siemens to supply a 29 MW drive for the 40-foot SAG mill and two 22 MW drives for the 28-foot ball mills. “At 29 MW, we’re clearly in a power range where the gearless drive offers the only acceptable technical solution,” he explains. “There are people out there that might argue that you can get that kind of power for the ball mills with geared solutions, but to my knowledge there is no running installation that is using geared technology at that power threshold.”

The break-even point

The main drawback is the upfront investment. Gearless drives cost more than conventional ones. For a 16 MW, 26foot ball mill, estimates Roesch, the combined investment of mill and motor is about 10 to 15 per cent higher than a conventional design. “However, you would pay it back in one to three years,” he adds. For higher-power applications, the operational cost savings outweigh the starting cost. Roesch judges that the break-even point for many gearless mill drives would be around 14 to 16 MW of installed power, although recent applications start at 10 to 13 MW.

Other applications, without the complex engineering required to wrap the motor around a mill, have a considerably lower break-even point. A commonly cited calculus for conveyors pins 2.5 MW as the magic number at which gearless becomes worthwhile.

Steady growth

As mines continue to develop in remote regions with high costs and low grades, gearless-drive use seems likely to spread. But when it comes to the less common uses like pumps and draglines, comments Roesch, “I would say there is a lack of interest and information.” Nevertheless, there is theoretically scope for further application of the technology. Within grinding, Jari says it is being explored for use in stirred mills, which agitate material within a stationary shell. The technology is also maturing in predictable ways. The introduction of remote monitoring, for example, has provided more reliable information about drive operation. If miners continue to accumulate vast throughputs, drive manufacturers may find themselves once again cooperating with mill manufacturers to go bigger. The current largest mill on order is a 42-foot, 28 MW SAG mill for Newmont Mining’s Conga project. If there is an interest in pushing past that, says Jari, “It’s not a question of the capability, we can design it. It’s about who’s going to be the first one to do it.” CIM

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54 | CIM Magazine | Vol. 9, No. 7

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Courtesy of Eldorado Gold

CHINA

It is hard to overstate the importance of China to the world’s resource projects. In the capacity for investment, the demand for commodities and the potential for new mining projects on its own soil, most other countries pale in comparison.

INSIDE: MADE-IN-CHINA MINING EQUIPMENT WHAT REALLY DRIVES CHINESE INVESTMENT? UNDERSTANDING THE CHINESE GREEN MINING STANDARD PROJECT PROFILE: ELDORADO GOLD’S JINFENG MINE TRAVEL: LINCANG

Tiptoeing into the big leagues Manufacturing in China is economically competitive but must overcome stigma

Hatch procured modules for the Koniambo Nickel project in Qingdao, China, saving the project approximately four months of time and 50 per cent of the modules’ cost. Once completed, they were shipped to New Caledonia by Dockwise for installation.

ade-in-China pieces make up a small portion of the economic pie for Wajax Equipment’s Prairie region, roughly one per cent of whole good sales, says Lee McMartin, the company’s general manager for the Prairies. But there is a tangible benefit: the pieces cost far less to make and they are the same quality as those manufactured elsewhere. Wajax Equipment’s Prairie region switched to using a Chinese manufacturer to produce smaller accessories in 2013. Clients buy the made-in-China pieces to customize their current machinery for specific applications, for which Wajax Equipment is a Canadian distributor (they represent companies that produce equipment for construction, forestry, material handling and mining). The company’s Prairie region includes Manitoba, Saskatchewan and Alberta, and previously used various manufacturers across Canada and the United States; it is the only one of Wajax Equipment’s four regions to source manufacturing in China at this time. As pleased as he is with the present arrangement, McMartin admits he hesitates to talk publicly about Wajax’s 56 | CIM Magazine | Vol. 9, No. 7

Courtesy of Dockwise

By Kelsey Rolfe

work in China. “I preach it,” he says. “I’ve been there, I see what they do, I believe in what they do.” But “people really aren’t accepting of China yet. I think that the North American manufacturers have done a great job of disconnecting themselves from China although they’re using them in a very large capacity.” McMartin says his is a common concern, and he knows of several other companies that do not like to say they are using Chinese manufacturers because of the perception of inferior quality. “The competitors try to bash them,” he says. “So they tell their customers [that they import from China], but not the general public.” Gordon Houlden, director of the China Institute at the University of Alberta, says western companies like Wajax using Chinese manufacturers is fairly new and he thinks it is a trend that will continue to grow. “I think that the cost factors are significant,” he explains. “[Chinese] manufacturing continues to get more sophisticated every day. If you’re a producer, you may find excellent, serviceable equipment at a very competitive price from exporters in China.”

Mitch Altman/Flickr

October/Octobre 2014 | 57

China

“I would have to say that there is probably trepidation around [using Chinese manufacturers],” says Spencer Ramshaw, director of information and communication at the Canadian Association of Mining Equipment and Services for Export (CAMESE). But, “it’s a situation where you need to produce a safe product that is the best design and best value, and you don’t ignore certain areas of the world simply because you might have heard there’s a problem.” Chris Twigge-Molecey, a senior advisor at Hatch, agrees, saying he would advise those involved in Chinese manufacturers have improved the quality of their work. procuring equipment or parts to overcome their prejudices: “As I often have told people, you fly on McMartin says the only issue the Prairie division faced an Airbus, and at least a third of every Airbus is made in China. So what are you concerned about? You committed when it started work in China was a long lead time. “We’ve had a few back and forths, but otherwise it’s been no differyour life to it already.” Hatch has four lines of business in China, including ent than dealing with any manufacturer that’s 2,000 miles procuring products from Chinese manufacturers for its away.” clients. After 10 years, the company has established a list of pre-approved manufacturers that Twigge-Molecey says runs INTELLECTUAL PROPERTY AN EVOLVING into the hundreds, depending on the item that needs to be UNDERSTANDING China’s insufficient intellectual property laws were produced. A 2013 McKinsey & Company report on China listed named in a 2011 Deloitte report as a factor that worked the “breakneck development” of China’s manufacturing sec- against the growth of the country’s manufacturing industry. tor as something that became a problem for achieving oper- Houlden says this is something Canadian companies enterational excellence: with so many new workers entering the ing joint ventures with Chinese partners should be espemanufacturing industry, they were ill-trained and unable to cially aware of, and gives the example of a Canadian do a thorough job. Hatch got around this problem, Twigge- company working in China that learned its ore treatment Molecey says, by taking the time to train Chinese workers: process had been patented by a Chinese third party. “China’s in the early stages – well, medium stages – of “There’s a lot of turnover in staff in these fabrication shops, developing their own more robust and more effective intelso they’re always training new people.” A large part of Hatch’s procurement group in China is lectual property system,” Houlden says. He also cites the made up of professional inspectors, who evaluate any man- Canada-China foreign investment promotion and protecufacturers that apply to work as a vendor for the company, tion agreement, which came into effect October 1, as an and work with existing vendors to make sure they under- improvement. It would allow for international arbitration of stand Hatch’s specifications, which Twigge-Molecey says disputes in either country, giving Canadian companies a better chance of resolving patent disputes in their favour, allows them to get the best results. And if quality can be controlled, Chinese manufacturing rather than in a Chinese court where they would be at a dismay be the only logical choice in a tough economy. “How advantage. Ramshaw, Houlden and McMartin all suggest compado you compete in a market today when everybody is squeezing every last nickel of profit out of you?” McMartin nies looking to do business in China perform proper due asks. “As a dealer, we buy from the manufacturers, and so diligence, such as getting advice from other western comthe only way we can try to improve our margins is to look panies working in the country and talking to the trade commissioner service, consulates or embassies. “Having at alternative sources for bits and pieces.” nothing to do with China is probably not a winning stratThat level of quality, Twigge-Molecey notes, “has been egy,” Houlden says. “But have your eyes wide open and get steadily improving over the years as they deal more and CIM advice.” more with western folks.”

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RISKS CAN BE WORTH THE REWARD

Exchange rate China insider and mining investment mastermind Keith Spence on how that country went from an investee to investor Courtesy of Keith Spence

By Chris Balcom

hina’s big moves in the mining industry have attracted considerable international attention in recent years. Few understand the country’s development better than Keith Spence, who has been working in China for more than a decade. With a background in geology and investment banking, Spence first came to China as the president of an exploration company working in Xinjiang, and later became an early mover in China’s outbound investment in the mining sector. Today, Spence serves as president and partner of Global Mining Capital Corporation, involved in private equity and partnering with Chinese investors looking to make international acquisitions. Spence is a CIM Distinguished Lecturer and former CIM board member, and is the recipient of several awards, including the Queen Elizabeth II Diamond Jubilee Medal and the Robert Elver Mineral Economics Award.

to allow foreigners to invest in mining. What China needed at that time was money. It sounds like a joke now, but it was really true. They needed money, they needed management expertise and they needed technical help, particularly in exploration. Then, from about 2004 to 2005, China started to change from an importer of capital to an exporter. The seminal event was when China Minmetals made a bid for Noranda. Minmetals was unsuccessful in its bid, but that was the time when we started looking at China as having serious money. Since then we have seen a change in the kind of projects the Chinese have been seeking. The geographies they’re interested in have changed considerably over time, the types of metals have changed over time, and the actors have changed over time.

CIM: Drawing on your first-hand experience, how would you explain China’s rise as a major investor in foreign mining projects? Spence: From 1999 to about 2004, there was a huge influx of investment in China because it had just changed the laws

CIM: Let’s start with the actors. Is it still primarily stateowned enterprises that are investing abroad? Spence: Initially, it was mainly state-owned enterprises because they were the ones that had the resources and the technical depth to go abroad. They were also the ones who

58 | CIM Magazine | Vol. 9, No. 7

CIM: What kind of projects and minerals are of interest to Chinese investors? Spence: There is a strong focus on very late-stage, neardevelopment projects. That is the sweet spot for the Chinese right now. There isn’t a lot of interest in early-stage exploration. In terms of minerals, most of the Chinese forays abroad have been in what I call the “big four”: copper, iron ore, metallurgical coal and to some extent, gold. Now the focus is on gold and to some extent, copper. CIM: How has the ownership structure that Chinese investors seek changed since their first forays abroad? Spence: In the early days there couldn’t be any deal that was structured without majority control. There are still some who insist on majority control but that demand isn’t as strong as before. Now they’re starting to consider strategic investments in the 20 to 30 per cent level and also joint ventures. All of these transactions usually involve some form of mineral off-take agreements. This structure has elements of the Japanese model of the 1970s, where the Japanese took a minority stake in the foreign company but also got access to the mineral output. This has a lot of advantages. You allow the foreign company to run the company and handle all the technical and managerial challenges, but you still have what you really want, which is access to the raw material. CIM: What kind of challenges have the Chinese faced in their pursuit of foreign mining assets? Spence: The labour standards are a lot less rigorous in China than in some other countries, so there have been labour problems in some of the investments in Africa and in Latin America. The other challenge is management of the

CIM: Is securing supply the reason why Chinese firms have been so active abroad? Spence: I would say there are three principal reasons. One is what everybody talks about – securing a source of raw material. Second, China also looks to some of these acquisitions to beef up their technical and managerial skills. By making these acquisitions they’ll learn how to operate overseas and learn some of the capital market skills as well. But probably the most important reason for these investments is to diversify China’s huge foreign reserves. By last count, China had more than $3 trillion in foreign reserves, with most of it in U.S. dollar instruments. It’s another way to manage some of that money by putting it into hard assets, such as in mineral resources, and as a hedge against the U.S. dollar. This is just good portfolio management. CIM: What kinds of lessons are the Chinese learning going forward? Spence: Number one is that they should use foreign advisors in all their acquisitions. That includes technical and financial advisors, but also for corporate social responsibility, environment and political risk management. All of these advisors are integral to making a foreign acquisition successful. CIM: What does the future hold for Chinese investment? Spence: I think the Chinese are now more focused on their international investments and they have liberalized the rules so that not every investment has to be approved by government, only the very large ones. The future augurs well. Mineral prices are at all-time lows. I often tell my Chinese partners this is a time for a buying spree, and the irony is that the Chinese were actually more aggressive in foreign investments during the time when the prices were high. Now they’re a little more cautious because they know more and they’ve had to deal with some challenges. Expect more investments and mergers and acquisitions from China, but from a more sophisticated and astute Chinese investor. CIM October/Octobre 2014 | 59

China

CIM: What about the geographic change? Spence: In the early years, there was more emphasis on Africa, which was a natural fit because China had very strong relationships with a lot of Third World countries. Most of the early investments were in Africa because of diplomatic relations. The African investments, while in mining, were tied to infrastructure developments. There were also a lot of early investments in Latin America. As the boom continued, you started seeing China spread out to Australia, Canada, Central Asia and Southeast Asia. Since the downturn in the market, the Chinese risk appetite has changed and the focus has been on less politically risky places. The countries at the top of the list now are Canada and Australia.

soft issues, which they didn’t pay a lot of attention to. One case in point: one of these companies has a project in Peru, which they haven’t been able to develop because of local opposition. Then in the more developed countries, there’s a sort of backlash, a form of nationalism, like we had in the case of the Chinese national oil company CNOOC’s purchase of Nexen, where people were saying, “Yes, you can invest in our country if the companies are small and insignificant, but when you’re going to take national treasures or national trophies, that’s a problem.” Another issue that the Chinese have faced in their investments abroad is that their due diligence probably wasn’t what we would do in North America. Just on purely economic criteria, they’ve made acquisitions and then have realized that there are a lot of issues they weren’t aware of.

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got permission because in order to go overseas to make acquisitions, you have to get permission from the state. Now there’s more diversification in the kinds of investors. You’re seeing companies in other industries that want to make investments in mining, and you’re also seeing smaller mining companies and private mining companies. So there’s been more of a mix in the last few years.

Courtesy of Lu Jing

Inside the Chinese Green Mining standard The Fankou mine has undergone major changes in recent years By Lu Jing

o prevent and reverse the destruction of the environment that has occurred in the past due to mining, the Chinese government came up with a new strategy to help create a more resource-conserving and environmentally-friendly society. The Chinese Ministry of Land and Resources conceived the Green Mining Standard in 2007. The following year, the National Mineral Resource Program was compiled and the Guidance to Implement the National Mineral Resource Program, Develop Green Mining and Construct a Green Mine was issued in 2010, establishing a defined Green Mining Standard. The standard assesses nine aspects of an operation: mining legally, good practices, using all resources efficiently, technological innovation, reducing waste release, environmental protection, reclamation, harmonious community relationship and good enterprise culture. The Fankou mine, owned by Shenzhen Zhongjin Lingnan Nonfemet Co. Ltd., is one of the biggest lead-zincsilver producers in Asia. Fankou began its commercial production in the 1960s and the facility, located in Guangdong Province, earned green mine certification in 2012. 60 | CIM Magazine | Vol. 9, No. 7

In order to satisfy the national standards, as well as its own goals, Fankou has taken numerous actions, all of which are directed by three key drivers: 1. Establishing a good management system, which is the basis of a good operational practice. Fankou continually improves its management system to match its technological and industrial development. 2. Paying increased attention to advanced technology, techniques and facilities. These are the tools needed to make green mining a reality. Green mining is a general concept that implicates almost every area of a mine operation, especially technology and technical improvements. For example, by using vertical crater retreat, and panel mechanized midlonghole mining methods, whole-tailings tilling, and the foamed mortar backfill method for mining, the efficiency of mineral resource exploitation and tailings disposal are increased. In addition the mine saves power by using the electrical frequency conversion in mining and ore processing operations, and by using energy-efficient lighting. Curtain grouting is used as a water management technique, which prevents about 50 per cent of the under-

business at Shenzhen Zhongjin Lingnan Nonfemet Co. Ltd. She has 10 years of experience in the company, previously in HR management, moving to managing overseas investments in 2010. She also has experience working in the company’s subsidiaries in Australia and the Dominican Republic. She holds a PhD in management.

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October/Octobre 2014 | 61

China

LU JING is the deputy general manager of international

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ground water from entering the mine in the first place. Fankou has bought automated equipment from Germany, Finland, the United States and Canada to improve productivity and safety. 3. Persisting in environmental protection. The mine attaches importance to environmental management and uses it as a basic guideline for the whole mining operation. Fankou achieved the ISO 14001 environmental management standard in 2012 and was awarded the Guangdong provincial “Environmental Integrity Green Brand Enterprise.” Because of the environmental protection and mine reclamation initiatives, pollution issues have been improving. Conflicts between the mine and the community, which stem mainly from pollution, are also diminishing. Another subsidiary of Zhongjin Lingnan Nonfement, located in Guangxi Province, is currently working towards the national “Green Mine” certificate. But different mines face unique challenges. For Fankou, the biggest difficulty was waste water recycling and tailings disposal, while for the mine in Guangxi Province, it is mineral recovery rate improvement. The Green Mining certification is voluntary, rather than compulsory, for all mines in China, which means deciding whether or not to become a green mine depends on individual circumstances. But it is clear that in China, mines of a considerable scale are motivated to achieve the new standard; 459 mines have been certified since 2010. Green mining increases an enterprise’s spending. Therefore, it is crucial that companies balance the cost of investment at present with the potential for production in the future, and consider how their individual expenses will correspond with improvements in the environment. Of course, this is related to other concepts, such as corporate cocial responsibility and corporate citizenship. Potential government assistance also plays a very important role in enterprises’ consideration of adopting green mining standards. For example, different provinces in China have issued their own policies to give some financial support (in the form of allowances or awards) to encourage mines to improve their facility, technology in mining or tailings storage. In some places, the local governments also give certain tax deductions when a mine spends on improving its facility or technology. It has been proven here that government financial support is a great stimulus for mining companies in achieving higher environmental performance. CIM

Keep the gold bugs happy All photos courtesy of Eldorado Gold

Eldorado’s Jinfeng operation uses the BIOX process to liberate gold from its refractory ore By Alexandra Lopez-Pacheco

n 2005, Eldorado Gold Corporation first ventured into China through the acquisition of Afcan Mining, which included the Tanjianshan Gold project. The Vancouverbased company subsequently became the leading foreign gold producer in the country through the acquisition of Sino Gold in 2009, which comprised the Jinfeng mine and the smaller White Mountain mine assets. With a currently estimated 13year mine life, Jinfeng, an open pit and underground gold mine located in China’s southern Guizhou Province, is the country’s largest known Carlin-type gold deposit. It is the company’s second-largest gold producer, treating around 1.5 million tonnes of ore per year and producing between 120,000 and 165,000 ounces of gold per year. Jinfeng also happens to have the third-largest of the only seven operating BIOX plants in the world. BIOX is a biotechnology fully commercialized in the 1990s for refractory ores and concentrates in which gold is encapsulated in sulphide minerals such as pyrite, arsenopyrite and pyrrhotite. Without a pretreatment such as BIOX or the more common roasting and pressure-oxidizing processes, 62 | CIM Magazine | Vol. 9, No. 7

cyanidation would only leach some 20 or 30 per cent of the gold. Eldorado had previously used the BIOX process at the Sao Bento mine in Brazil, which the company operated from 1996 until its eventual closure in 2007. According to Paul Skayman, the company’s chief operating officer, Eldorado’s extensive previous experience with BIOX allowed the team to continue to improve upon the process. As a result of the continued improvements, the BIOX plant at Jinfeng is a robust operation and one of the most successful examples of the process in the world today.

BIOX One of the biggest advantages of BIOX is that it can help keep operating labour costs down, according to Jan van Niekerk, managing director, Biomin South Africa Pty Ltd., which owns the patented BIOX process. This is due to its relative ease of operation and minimum staff requirement. “You don’t have to bring in highly trained experts,” he says. “You can rely on a local workforce.”

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China

EQUIPMENT INVENTORY OPEN PIT MINING

3 Atlas Copco ROC L8 drill rigs 1 Atlas Copco CM780D drill rig 20 Komatsu HD605-7 63-t trucks 1 Hitachi 850 excavator 2 Hitachi 870 excavators 1 Komatsu PC400 1.8 m3 excavator 3 Komatsu PC 1250SP-7 6.7 m3 excavators

Because BIOX is a biological process that uses bacteria to break down the sulphide mineral matrix and liberate the gold for cyanidation in a series of very large tanks, most of the work involves making sure the living organisms are well fed and in good health. They need to be “fed” the ore – or more precisely, the sulphide – regularly and evenly. “The bugs are a little particular on temperature,” says Skayman. “So the tanks have significant cooling systems to keep them at the right temperature. But it’s not a super-complicated process. Once the guys have a handle on what works and what doesn’t work, it’s pretty reliable.” It takes about a week for the bacteria to do their job and leave the material ready for cyanidation. Skayman says there have been some pleasant surprises: “There’s a small amount of mercury in the ore at Jinfeng, so when they built the plant, they installed a full mercury management system. But interestingly, with BIOX, the bugs don’t eat the mercury, so it is not liberated. They leave it in the sulphide matrix and as a result, there is no necessity to operate the mercury management system. If it was a roaster or a different circuit, you’d be managing things very differently.” In addition, Jinfeng uses a treatment process that breaks down thiocyanate (SCN-) to ammonia (NH3/NH4), to nitrite (NO2) and then onto nitrates (NO3) that can be safely discharged, he goes on to say. “Our initial experience with the BIOX process at our Sao Bento mine, coupled with our experience at Jinfeng has allowed us to accumulate 20 years of experience in understanding and operating the process,” Skayman explains. “We wouldn’t shy away from a BIOX circuit and we would certainly consider utilizing BIOX again if the conditions were favourable. Gold deposits are becoming more metal-

UNDERGROUND 6 Atlas Copco Boomer 282 jumbos MINING 1 Wagner Wagner MT-439 truck 4 Caterpillar AD45B trucks 1 Wagner ST-7.5Z loader 1 Caterpillar R2900G loader 3 Caterpillar R1700G loaders 1 Jinchuan Machinery JCCY-6 loader

lurgically challenging, including the growing necessity to treat refractory ores, and BIOX represents a proven technology in this successful treatment.”

THE NUTS AND BOLTS Jinfeng, which covers an area of 128.4 hectares with rugged karstic topopgraphy, is well supported by local infrastructure. Although the mine has a 1.2-megawatt diesel genset on site as backup for grid disruptions and to keep the cooling system for the BIOX circuit operating, Jinfeng is connected to the provincial electrical grid. The site is also accessed through sealed access roads. Water is pumped through a three-kilometre pipeline from the Luofan River to the mine’s processing plant. Once the ore is mined from both the open pit and underground operations, it is sorted into numerous stockpiles at the process plant, based primarily on the ore’s gold grade as well as its hardness and sulphur grade. Ore is blended from the different piles to achieve a uniform feed and is put through a primary jaw crusher. The resulting stockpile material is then fed through the SAG mill and two ball mills. Once milled, the ore is fed through a flotation circuit and the resulting concentrate is thickened. Thickened, the material is transferred to two identical trains of tanks where the BIOX process takes place. Five to six days later, the oxidized pulp is pumped into a multiple-stage thickener circuit where the solids are separated from the liquid. The solution overflow is neutralized and discharged to tailings while the underflow material is pumped into a CIL circuit. Carbon is fed through the circuit counter-currently to collect the gold that has been leached into solution. After 24 hours, the October/Octobre 2014 | 63

64 | CIM Magazine | Vol. 9, No. 7

SPECIAL REPORT

BIOX PLANTS IN OPERATION WORLDWIDE

Kokpatas Suzdal

Jinfeng

Bogoso Fairview Fosterville

FAIRVIEW owned by Pan African Resources, South Africa; JINFENG owned by Eldorado Gold, China; ASHANTI owned by AngloGold Ashanti, Ghana; FOSTERVILLE owned by Crocodile Gold, Australia; SUZDAL owned by Severstal, Kazakhstan; BOGOSO owned by Golden Star Resources, Ghana; KOKPATAS owned by Navoi Mining and Metallurgical Combinat, Uzbekistan

carbon is taken from the CIL circuit for gold removal by Zadra methods consisting of stripping, electrowinning and smelting. Jinfeng’s final product is a gold doré bar that is sold to a local refiner at world spot prices.

OPERATING IN CHINA When Doug Jones, Eldorado’s senior vice-president, operations, first took on the role of overseeing Eldorado’s operations in China almost three years ago, he was surprised by the similarities between doing business there and in the West. “Partly that’s because I had set up the expectation that it would be way different,” he says. Still, there are differences. For one, Chinese culture – and its government – tends to have a far longer view when it comes to planning than westerners, often looking 10 to 20 years ahead. Jones says the safety and environmental regulations in China are on par with those of any major western economy, and in fact, the country requires permits not just for safety and the environment but also for extraction. And Captions, left: 1. Jinfeng is transitioning to underground-only operations as open pit reserves are depleted; 2. Eldorado operates by the same standards across all jurisdictions; 3. BIOX and a CIL circuit refine the product; 4. Jinfeng is Eldorado’s second-largest gold producer

from day one, Eldorado’s approach was to take a leadership role in good operating practices. “There’s a standard we’re hammering around the world,” says Jones. This is part of the reason why doing business in China is not very different for Eldorado from operating in any other state. The company operates by the same standards across all jurisdictions. Open pit mining is done by a contractor, China Railway 19 Bureau Group Corporation, and Guizhou Construction Company is the drilling contractor. When it comes to the BIOX process, the experts at Jinfeng are Chinese. “They run a very robust operation with excellent recoveries and they continue to improve recoveries year after year,” Jones says, adding the plant’s gold recovery rate has gone from some 82 per cent in 2009 to 87 per cent today as its operators continue to optimize the conditions for the bacteria.

PLANS FOR THE FUTURE While 13 years of mine life remain, Jinfeng is now in the process of moving operations to become underground-only in 2017. It is a process that began in 2008 when the mine first went underground, with ore production progressively ramping up year after year and expected to reach 800,000 tonnes per year by 2015. Currently, the mine is conducting studies with the hope of increasing production after next year to 1.2 million tonnes of ore annually for the estimated 10 million tonnes of ore underground. That translates to some 175,000 ounces of gold processed by BIOX coming out of Jinfeng each year, if all goes as hoped. CIM October/Octobre 2014 | 65

China

Ashanti

TRAVEL

Lincang By Graham Lanktree

ust north of the Tropic of Cancer, in a temperate highland valley where China’s Hengduan and Nu mountain ranges meet, the city of Lincang is going through a growth spurt. Locals say this modern prefecture city of more than 290,000 people, with its wide, freshly paved central boulevards and new apartment buildings, looks nothing like it did just six years ago. The rugged vegetation of the countryside, tea farms and thatched-roof villages of the ethnic Wa people surrounding it belie a different time and way of life. Industry is spurring the city’s growth and vast mineral wealth lies in the region, with coal, germanium and uranium mined nearby.

DINE

Kris Ariel

Croquant via Wikipedia

WHERE TO

STAY

TIP

It’s easy to see why Lintong Grand Hotel is a popular standby for business travellers to Lincang. Centrally located on Shiji Road, it offers a free wireless network throughout the building. Rooms start at $68 (¥380 CNY) and its large conference and meeting rooms, western restaurant and other amenities – including a tennis court and pool – make it a safe bet. At the intersection of Shiji and Fengxian roads

HOW TO

The months from June to September see 70 per cent of Lincang’s annual rainfall (117 centimetres).

FIT IN

It’s easier to get around in Lincang if you know some basic Mandarin, especially when ordering food, but there are a number of important points of business etiquette to remember too. Confucianism, with its attention to demeanour, harmony, and preservation of “face,” plays a central role. 66 | CIM Magazine | Vol. 9, No. 7

Meetings always begin with a handshake. Give a slight nod and don’t be too vigorous when shaking hands, it could come across as being aggressive. Stay away from physical contact after this, including pats on the arm. If a host is guiding you they may tug your sleeve.

Have business cards translated on one side. It is considered fortuitous if they are printed in gold ink. Be sure to place received cards in a case rather than your pocket. Avoid humour since jokes may not come across as you intend. Gift etiquette and negotiations can be complex, so it’s best to

Zarrin Maani

WHERE TO

The city’s restaurants borrow influences from all over the region, including Vietnam, Laos and Myanmar, all of which border Yunnan Province to the south. Savory noodle and stir-fry dishes packed with chilies are mainstays of this diverse cuisine. Locals eat at the Youli Jinwang Restaurant, near Qishan Mountain, which offers a Dai (descendants of Lao and Thai) take on traditional. The Yishunxiang Muslim Restaurant offers up an exceptional twist on local fare, eschewing the usual pork found in a Chinese diet for Halal options. If you’re hungry for something more western, Salvador’s Coffee House serves pizza, waffles and wraps ($3-$8 or ¥17-¥45 CNY) as well as americanos and cappuccinos starting at $3 (¥17 CNY).

TIP Bugs are a popular snack in Yunnan Province. So be careful about what you order on restaurant menus.

Yunnan Adventure

HOW TO

GET THERE

Both China Eastern and Southern Airlines fly daily to Lincang. Leaving from the major city of Kunming, prices begin at around $300 for round-trip tickets. Connecting flights to Kunming from Beijing arrive regularly on carriers including American Airlines, Qantas, JAL and United Airlines. All-in from Canada the trip will cost about $1,500. Once at Lincang airport, it’s a 22.5kilometre journey north to the city centre. Taxis are available at $22 (¥123 CNY), and an airport shuttle bus is timed to flight arrivals. If the budget is an issue, overnight sleeper buses to Lincang leave from Kunming’s West Bus Station. Depending on which bed you choose, they can cost as little as $32 (¥180 CNY). The trip takes between nine and 12 hours.

PAY

All transactions are made in Chinese Yuan Renminbi (CNY). The currency is used throughout the country and available at any ATM. C$1 is worth about ¥5.6 CNY. Frequently used bank notes are: ¥1, ¥5, ¥10, ¥20, ¥50, ¥100.

Yunnan Adventure

and Theravada Buddhist temples and a Protestant church, nuzzled among Lincang’s large modern buildings. They offer an architectural counterpoint to the present. But if you seek more of the ancient past, visit the Neolithic paintings on the cliffs of Cangyuan County. Eleven painted rocky outcrops are scattered through several villages nearby. Images of animals, trees, boats, the sun, the moon, mountains, and abstract symbols float on the limestone surface and can appear in red, sandy brown or purple hues depending on the time of day and humidity. Check in with local travel agents to schedule a

Yunnan Adventure

you can see the process of preparing tea and experience the local folk customs. A day trip away in the mountainous village of Jinxiu in Fengqing County grows an ancient tea tree said to be 3,200 years old. In mid-April the local Kun people hold a colourful two-weeklong festival honouring it and the crop’s importance. Pick out the beautiful Taoist, Mahayana

visit in advance. A taxi booked at your hotel should cost around $75 (¥420 CNY) to get there. Closer to Lincang is the 3,429-metre tall Big Snow Mountain connected to several other peaks ranging from 3,177 to 1,813 metres. All are easily accessible by a bus that covers the 100-km distance or by taxi for roughly $53 (¥300 CNY).

TIP Update your medications. Some malaria

medicines will not work against strains found near the China-Burma border.

GETTING

China

nection to more than 500 years of Chinese tea culture. To dig deeper, head north and visit the Lincang Tea Culture and Customs Garden where

SPECIAL REPORT

It’s not unusual to see water buffalo lolling along the river that runs near Lincang’s modern main road. It can feel like a small town despite the big city surroundings. If you wander to the hilly south end of town you will find the twisting lanes of Lincang’s oldest streets. Keep wandering and you’ll find hills filled with tea farms and scratch the surface of the area’s con-

Yunnan Adventure

EXPLORE

Karl Baron

WHERE TO

AROUND

Lincang has little traffic relative to its wide roadways, making it fast and easy to get around by bike. You can rent gear in good condition from the Ronghui Bicycle Club and explore some areas of the countryside at your own pace. 711 Shiji Lu, www.ynzxc.com CIM October/Octobre 2014 | 67

CIM community CMP loses a champion: Ray MacDonald (1934-2014)

Ray MacDonald, a long-standing and instrumental member of the CIM community, passed away on August 10, 2014. Ray was deeply involved with the Canadian Mineral Processors (CMP) Society and, at the time of his passing, was the organization’s treasurer. In previous years he served as CMP secretary. The recipient of numerous awards himself, Ray’s tireless dedication to the society was recognized in 2011 when CMP established the annual Ray MacDonald Volunteer Award. “He was an integral part of the Canadian Mineral Processors for over a quarter century,” said Janice Zinck, who worked with Ray for nearly 25 years, and was the first recipient of the award named in his honour. “Ray quietly touched so many lives in both his personal and professional life and leaves behind a community of like-minded volunteers who will continue his efforts.” The CIM community extends its deepest condolences to Ray’s family and friends. CIM

Courtesy of Al Kuiper

By Chris Balcom

Ray MacDonald (right), who was deeply involved in the Canadian Mineral Processors (CMP) Society, poses at CMP’s 2013 student mixer with CIM pastpresident Chuck Edwards (left) and 2013 André Laplante Scholarship winner Cooper Meadows (middle).

Detour Gold wins Frank Grieco Golf Tournament

CIM Toronto Branch and the Canadian Mineral Processors (CMP) Society of CIM hosted the 14th Annual Frank Grieco Memorial Golf Tournament at the Glen Abbey golf course at the end of August. “We spent six hours on the golf course in brilliant sunshine,” said Curtis Clarke, CIM Toronto golf committee chair. “It was a wonderful day of golf followed by good food and great prizes.” The team from Detour Gold, sponsored by Toromont CAT, won the tournament that was played in a best ball scramble format. Teammates Martin Briere, Trevor Krawchyk, Rishi Ghuldu and Pierre Beaudoin scored a 53, 20under par. After finishing on the links, golfers attended a dinner and awards ceremony where $15,000 worth of prizes for various achievements, such as a hole-in-one, was up for grabs. The awards included “stay and play” packages at ClubLink golf resorts in the Muskoka region of Ontario for two nights and two rounds of play. The tournament is organized annually to raise funds for the local Toronto branch’s programs, which include monthly luncheons and various youth events. This year, the tournament welcomed 136 mining industry professionals, suppliers, consultants and financiers as well as CIM executive director Jean Vavrek.

68 | CIM Magazine | Vol. 9, No. 7

Courtesy of Ace Promotions

By Tom DiNardo

Golfers Vivien Clubb, Miranda Werstiuk, Wayne White and Peter Dallas (left to right) teed off at the Frank Grieco Golf Tournament under sunny skies.

The Toronto branch golf tournament was initiated 14 years ago by Frank Grieco, president of PR Engineering in Oshawa, Ontario. Following Grieco’s passing in May 2007, the event was named in his honour. CIM

CIM community

CIM joins OneMine By Tom DiNardo CIM members now have access to OneMine, a global collaborative effort among multiple societies to place a vast collection of mining and minerals-related research in one location. Originally created by the Society for Mining, Metallurgy and Exploration (SME) in 2008, OneMine is a digital database for the mining industry that features full text articles from conference proceedings, technical journals and other publications. Now that CIM is part of OneMine, members have access to the more than 106,000 documents that form OneMine’s extensive library, explained CIM executive director Jean Vavrek. The plan is to add thousands of CIM’s technical papers, currently available at cim.org, to the online database. Under the first phase of the project, 1,000 papers will be available on the OneMine site in early October, with an additional 4,000 estimated to be uploaded over the next several months. “The curation and dissemination of technical knowledge has always been a cornerstone of CIM’s mandate as the community for leading industry expertise,” said Vavrek.

“CIM members will have direct access to OneMine via the CIM website through a single sign-on process utilizing their CIM membership information,” explained CIM past-president (2013–14) Robert Schafer. For members, this means that once they log on to the CIM website, they will find a direct link to the OneMine site. “This is a significant move for CIM,” noted CIM president Sean Waller. “The recent strategic outreach exercise confirmed our members’ desire for access to quality technical knowledge, and we are confident that they will find great value in OneMine.” OneMine.org has evolved into a multi-society effort and is not solely associated with a single organization. In addition to SME, it also includes support from the Australasian Institute of Mining and Metallurgy (AusIMM); the South African Institute of Mining and Metallurgy (SAIMM); the Minerals, Metals and Materials Society (TMS); the International Marine Minerals Society (IMMS); and the Deep Foundations Institute (DFI). CIM

L’ICM se joint à OneMine Par Tom DiNardo Les membres de l’ICM ont maintenant accès à OneMine, le fruit de la collaboration de plusieurs sociétés souhaitant centraliser les travaux de recherche les plus exhaustifs au monde dans les domaines des mines et des minéraux. Initialement créée par la Society for Mining, Metallurgy and Exploration (SME, la société des mines, de la métallurgie et de l’exploration) en 2008, OneMine est une base de données numérique destinée à l’industrie minière qui contient des articles complets de comptes rendus de conférences, de revues techniques et d’autres publications. Comme l’expliquait le directeur exécutif de l’ICM Jean Vavrek, l’institut fait désormais partie de cette base de données OneMine, aussi les membres ont maintenant accès aux plus de 106 000 documents qui constituent cette bibliothèque exhaustive. Le projet est d’ajouter à cette base de données en ligne des milliers de documents techniques de l’ICM, actuellement disponibles sur le site Internet cim.org. Au cours de la première phase du projet, 1 000 documents seront mis à disposition sur OneMine début octobre, et il est prévu d’en télécharger environ 4 000 autres au cours des mois à venir. « La conservation et la diffusion des connaissances techniques ont toujours été au cœur du mandat de l’ICM en tant que communauté pour une expertise de premier plan », déclarait Jean Vavrek.

« Les membres de l’ICM auront un accès direct à OneMine par l’intermédiaire du site Internet de l’ICM. Il leur suffira d’ouvrir une session en utilisant leurs coordonnées de membre de l’ICM », expliquait Robert Schafer, ancien président de l’ICM (2013-2014). Après avoir ouvert une session sur le site Internet de l’ICM, les membres n’auront qu’à cliquer sur un lien qui les mènera directement à OneMine. « C’est une étape importante pour l’ICM », indiquait Sean Waller, président de l’ICM. « Notre récente activité stratégique d’information a confirmé le désir de nos membres d’accéder à des connaissances techniques de qualité, et nous sommes persuadés qu’ils trouveront de précieux renseignements dans OneMine. » OneMine.org a évolué et réunit maintenant les efforts de plusieurs sociétés et non plus d’une seule organisation. Outre la SME, OneMine est également soutenue par l’Australasian Institute of Mining and Metallurgy (AusIMM, l’institut australasien des mines et de la métallurgie) ; le Southern Africa Institute of Mining and Metallurgy (SAIMM, l’institut sud-africain des mines et de la métallurgie) ; la Minerals, Metals and Materials Society (TMS, la société des minéraux, des métaux et des matériaux) ; l’International Marine Minerals Society (IMMS, la société internationale des minéraux marins) ; et le Deep Foundations Institute (DFI, l’institut des fondations profondes). ICM October/Octobre 2014 | 69

TECHNICAL ABSTRACTS

CIM

journal

Excerpts taken from abstracts in CIM Journal, Vol. 5, No. 4. To subscribe, to submit a paper or to be a peer reviewer—www.cim.org

Online X-ray fluorescence analysis of potash materials at various stages of processing E. Hasikova, V. Titov, A. Sokolov, and V. Gostilo, Baltic Scientific Instruments, Riga, Latvia

ABSTRACT Introducing online X-ray fluorescence (XRF) analyzers in the mining and processing industries can lower costs and improve the representativeness and speed of analysis. The applicability of the CON-XTM industrial conveyor XRF analyzer for continuous measurement of potassium content in process materials was demonstrated at various stages of potassium muriate (MOP) production. The CON-X analyzer produced reliable and accurate results for sylvinite ore (27–36% KCl), MOP cake after flotation (88–97% KCl), and NaCl residue (1.5–5% KCl). Tests of the analyzer at an MOP-producing plant showed a < 0.5% difference between online and laboratory results.

RÉSUMÉ L’utilisation par les domaines de l’exploitation minière et du traitement des métaux d’appareils d’analyse en ligne par fluorescence à rayons X permet de réduire les coûts et d’améliorer le degré de représentativité et la rapidité d’exécution du processus d’analyse. L’applicabilité de l’analyseur par fluorescence à rayons X CON-XMD pour transporteurs industriels à la production de mesures en continu du contenu en potassium de matières en cours de traitement a été démontrée à différentes étapes de la production de muriate de potassium (MOP). L’analyseur CON-X a donné des résultats fiables et précis dans les cas du minerai de sylvanite (27 à 36 % de KCl), des gâteaux de MOP recueillis après l’étape de flottation (88 à 97 % de KCl) et des résidus de NaCl (1,5 à 5 % de KCl). Des essais de l’analyseur menés dans une usine de production de MOP a permis d’établir une différence de < 0,5 % entre les résultats obtenus en ligne et ceux réalisés en laboratoire.

Industry-scale knowledge management—Introducing the RISKGATE underground strata and explosions body of knowledge P. A. Kirsch, J. Harris, D. Cliff, and M. Shi, Minerals Industry Safety and Health Centre, Sustainable Minerals Institute, University of Queensland, Brisbane, Queensland, Australia; B. Hebblewhite, School of Mining Engineering, University of New South Wales, Sydney, New South Wales, Australia; D. Sprott, Design Solutions Australia Pty Ltd., Buddina, Queensland, Australia; A. Ranjan, S. Sharma, and T. Biswas, Mining Engineering students, Indian School of Mines, Dhanbad, India; and S. Sharma, Mining Engineering student, National Institute of Technology Karnataka, Surathkal, Mangalore, India

ABSTRACT RISKGATE is an interactive online risk management system that compiles and presents current practices from a diverse range of Australian coal mining experts. The system is designed to assist the industry in implementing continual improvement in management of major unwanted events, thus maximizing health and safety performance. This paper presents an overview of the comprehensive body of knowledge developed for management of unwanted strata incidents and explosions in the underground environment. From a broader industry perspective, RISKGATE provides an environment for knowledge capture and exchange to drive innovation and advance current practices in the identification, assessment, and management of risk.

70 | CIM Magazine | Vol. 9, No. 6

RÉSUMÉ RISKGATE est un système interactif en ligne de gestion du risque; il compile et présente les pratiques actuelles de divers experts australiens en extraction du charbon. Le système est conçu de manière à assister l’industrie à mettre en œuvre des améliorations continues dans la gestion d’événements majeurs non désirés, maximisant ainsi le rendement en santé et sécurité. Cet article présente un survol des connaissances développées pour la gestion des incidents non désirés impliquant des strates et des explosions dans l’environnement souterrain. D’un point de vue industriel plus général, RISKGATE fournit un environnement pour la saisie et l’échange des connaissances afin de pousser l’innovation et faire avancer les pratiques actuelles dans l’identification, l’évaluation et la gestion du risque.

TECHNICAL ABSTRACTS

CIM

journal

Excerpts taken from abstracts in CIM Journal, Vol. 5, No. 4. To subscribe, to submit a paper or to be a peer reviewer—www.cim.org

Kinetics of hexavalent chromium reduction in constructed wetland mesocosms A. Rodriguez-Prado, Independent Consultant, Saskatoon, Saskatchewan, Canada; R. L. Legge, Department of Chemical Engineering, University of Waterloo, Waterloo, Ontario, Canada; W. C. Lennox, Department of Civil and Environmental Engineering, University of Waterloo, Waterloo, Ontario, Canada; and P. Kuschk, Department of Environmental Biotechnology, Helmholtz Centre for Environmental Research, Leipzig, Germany

ABSTRACT Using constructed wetlands to chemically reduce hexavalent chromium Cr(VI) to Cr(III) from industrial and mining wastewater has proven to be feasible and efficient. Applying first-order kinetics to describe the process is simple, but in some cases a more accurate model is required to reflect the process. This paper studies the feasibility of using non–first-order kinetics to describe the reduction process. Results indicate that half- and secondorder kinetics adequately described Cr(VI) reduction in laboratory wetland mesocosms. The organic carbon content played a relevant role, whether it was built up by plant growth or spiked into the feed water.

RÉSUMÉ L’utilisation de marais artificiels pour réduire chimiquement le chrome hexavalent Cr(VI) en Cr(III) des eaux usées industrielles et minières a été prouvée faisable et efficiente. L’application de la cinétique de premier ordre pour décrire le processus est simple mais, dans certain cas, il faut un modèle plus précis pour refléter le processus. Cet article étudie la faisabilité d’utiliser la cinétique de non premier ordre pour décrire le processus de réduction. Les résultats indiquent que les cinétiques de demi-ordre et de deuxième ordre décrivent adéquatement la réduction du Cr(VI) dans des mésocosmes de marais en laboratoire. La teneur en carbone organique joue un rôle pertinent, qu’il ait été rehaussé par la croissance des plantes ou qu’il ait été introduit dans l’eau d’alimentation.

Highwall mining technology—A review of current status and design methods C. P. Verma, Central Institute of Mining and Fuel Research, Maharashtra, India; N. R. Thote, Visveswaraya National Institute of Technology, Maharashtra, India; and J. L. Porathur, Central Institute of Mining and Fuel Research, Maharashtra, India

ABSTRACT Highwall mining is a highly mechanized coal mining method associated with several advantages, such as a very high production rate (approximately 3,000 t/d) and low production costs. There is no requirement for underground support, ventilation, or blasting. Production leads to added recovery, which is otherwise lost in the ultimate pit. The use of highwall mining can bridge the gap that exists between supply and demand in the energy sector. This paper presents a brief review of highwall mining technology, including current status, analysis tools, and design techniques. In addition, it identifies important parameters from the analysis of failure case studies.

RÉSUMÉ L’extraction sous paroi haute est une méthode hautement mécanisée d’extraction du charbon; elle comporte plusieurs avantages tels qu’un taux de production élevé (environ 3000 t/j) et de faibles coûts de production. Le support souterrain, la ventilation et le sautage ne sont pas requis. La production conduit à une meilleure récupération du charbon qui serait autrement laissé dans la fosse finale. L’extraction sous paroi haute peut combler le manque entre l’approvisionnement et la demande dans le secteur de l’énergie. Le présent article présente un bref survol de la technologie de l’extraction sous paroi haute, incluant son statut actuel, les outils d’analyse et les techniques de conception. De plus, il identifie des paramètres importants à partir de l’analyse d’études de cas de défaillances.

High-performance synthetic ropes for mine hoisting A. J. Guse, Vale, Sudbury, Ontario, Canada

ABSTRACT The primary limiting factor for hoisting capacity from great depths is the self-weight of steel wire ropes. As hoisting depths increase, the service life of steel wire ropes decreases due to the higher stresses and physical effects on the ropes. The significantly higher strength-to-weight ratio of synthetic ropes offers the advantage of hoisting a larger payload with a similar sized rope and hoisting plant. The beneficial properties of synthetic could be used to improve the overall economics of deep underground mining.

RÉSUMÉ Le principal facteur de limitation de la capacité de hissage des treuils à partir de grandes profondeurs est le poids propre des câbles d’acier. À mesure que la profondeur de hissage augmente, la durée de vie utile des câbles d’acier décroît en raison des plus grandes contraintes et des effets physiques sur les câbles. Le rapport résistance/poids significativement plus élevé des câbles de fibres synthétiques offre l’avantage de soulever une plus grande charge sans modifier les dimensions du câble ou du treuil. Les propriétés bénéfiques d’un câble de fibres synthétiques pourraient être utilisées pour améliorer l’économie générale des mines souterraines profondes. September/Septembre 2014 | 71

TECHNICAL ABSTRACTS

canadian metallurgical quarterly

Excerpts taken from abstracts in CMQ, Vol. 52, No. 4. To subscribe – www.cmq-online.ca

Adsorption behaviour of sodium hexametaphosphate on pyrochlore and calcite X. Ni and Q. Liu, Department of Chemical and Materials Engineering, University of Alberta, Edmonton, Alberta, Canada

ABSTRACT FTIR, XPS and zeta potential measurements were performed on pyrochlore and calcite to study the adsorption mechanisms of sodium hexametaphosphate (NaHMP). While no hexametaphosphate could be detected on the FTIR spectra of NaHMP treated pyrochlore or calcite, the observed chemical shifts of the binding energies of Ca 2p5/2 (0.25 eV) and P 2p (0.20 eV) electrons indicated that the hexametaphosphate groups formed a complex with calcium on calcite. The complex seemed soluble in water leaving a low concentration of its residue on calcite surface after water washing, thus undetectable by FTIR. The binding energy shifts of Nb 3d5/2 (0.13 eV) and Ca 2p5/2 (0.10 eV) electrons on NaHMP-treated pyrochlore were within instrumental resolution, therefore, NaHMP was not strongly bound to pyrochlore. The zeta potentials of pyrochlore and calcite were both lowered in the presence of NaHMP. However, for pyrochlore, the zeta potential drop occurred mainly in the acidic pH range, while the drop for calcite was independent of pH, indicating possible chemisorption of NaHMP on calcite. The work explained the selective depressive function of NaHMP in the hydroxamic acid flotation of carbonatite niobium ores.

RÉSUMÉ On a effectué des mesures de FTIR, de XPS et de potentiel zêta du pyrochlore et de la calcite afin d’étudier les mécanismes d’adsorption de l’hexamétahosphate de sodium (NaHMP). Bien qu’on ne puisse pas détecter d’hexamétaphosphate dans les spectres de FTIR du pyrochlore ou de la calcite traités au NaHMP, les décalages chimiques observés des énergies de liaison des électrons de Ca 2p5/2 (0.25 eV) et de P 2p (0.20 eV) indiquaient que les groupes d’hexamétaphosphate formaient un complexe avec le calcium sur la calcite. Le complexe semblait soluble dans l’eau, laissant une faible concentration de son résidu à la surface de la calcite après lavage à l’eau, donc indétectable par FTIR. Les décalages de l’énergie de liaison des électrons du Nb 3d5/2 (0.13 eV) et du Ca 2p5/2 (0.10 eV) du pyrochlore traité au NaHMP se situaient dans les limites de résolution de l’instrument. Donc, le NaHMP n’était pas fortement lié au pyrochlore. Les potentiels zêta du pyrochlore et de la calcite s’abaissaient tous deux en présence de NaHMP. Cependant, la chute de potentiel zêta du pyrochlore se produisait principalement dans la gamme de pH acide, alors que la chute pour la calcite était indépendante du pH, indiquant la possibilité d’une chemisorption du NaHMP sur la calcite. Ce travail explique la fonction sélective et dépressive du NaHMP lors de la flottation à l’acide hydroxamique des minerais de carbonite de niobium.

Correlation of initiation of corrosion pits and metallurgical features of X100 pipeline steel X. Y. Peng, G. C. Liang, College of Petroleum Engineering, Southwest Petroleum University, Chengdu, Sichuan, China; T. Y. Jin, and Y. Frank Cheng, Department of Mechanical and Manufacturing Engineering, University of Calgary, Calgary, Alberta, Canada

ABSTRACT In this work, corrosion pits initiated on X100 pipeline steel and their correlation with the metallurgical features of the steel were characterised by scanning electron microscopy and energy dispersive X-ray spectroscopy. It was found that pits are always associated with various inclusions. For pits initiating at an MnS inclusion, a preferential dissolution occurs of the steel matrix at the inclusion/steel interface, with the inclusion remaining inside the pit. For duplex inclusions consisting of both MnS and Al2O3, the Al2O3 component is dissolved in the pit solution. Pits initiated at Al2O3 and Ca/Al/Mg/O inclusions are also due to the preferential dissolution of the adjacent steel. However, the Si enriched inclusion is anodic relative to the steel matrix, resulting in dissolution of the inclusion to initiate pits.

72 | CIM Magazine | Vol. 9, No. 6

RÉSUMÉ Dans ce travail, on a caractérisé les piqûres de corrosion initiées sur l’acier X100 pour pipeline et leur corrélation avec la caractéristique métallurgique de l’acier, au moyen de la microscopie électronique à balayage et de la spectroscopie à dispersion d’énergie. On a trouvé que les piqûres étaient toujours associées à diverses inclusions. Pour les piqûres initiées à une inclusion de MnS, une dissolution préférentielle se produit sur la matrice de l’acier à l’interface entre l’inclusion et l’acier, l’inclusion se retrouvant à l’intérieur de la piqûre. Pour les inclusions conjuguées consistant à la fois de MnS et d’Al2O3, la composante d’Al2O3 est dissoute dans la solution de la piqûre. Les piqûres initiées à des inclusions d’Al2O3 et de Ca/Al/Mg/O résultent également de la dissolution préférentielle de l’acier adjacent. Cependant, l’inclusion enrichie de Si est anodique par rapport à la matrice de l’acier, résultant en la dissolution de l’inclusion, ce qui initie des piqûres.

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October/Octobre 2014 | 73

War comes to Bell Island, Newfoundland By Herb Mathisen

Lt. Gerald M. Moses. Canada. Department of National Defence. Library and Archives Canada, PA-188854

n the fall of 1942, the world was at war for the second time to Sydney, loaded with 8,300 tons of iron ore. The ship sunk in 24 years. Having blitzed through western Europe, in three minutes from the two torpedoes that hit in quick sucGermany was engaged in a two-front conflict: in the east cession. Thirty seamen perished, only 14 survived. Witnessing with the entrenched Soviet Union, and in the west with the the attack, the crew aboard the Canadian steamer Lord StrathAllies hanging on to Great Britain. On this front, Germany knew cona pre-emptively took to lifeboats before two torpedoes conif it could choke off supplies nected with their ship 30 arriving from North America, it minutes later. The Lord could weaken and perhaps even Strathcona went down, but conquer the United Kingdom. all 44 crew members were For this reason, the Atlantic spared. The third ship, PLM Ocean became an important 27, escaped unharmed. battleground in the Second Defences and fortificaWorld War. The German navy, tions went up to try to prousing its prized U-boat subtect ships accessing Bell marines, had for the last two Island. Despite those efforts, years besieged the Allies with two more ships met their highly successful “wolfpack” demise at the hands of the tactics in which large groups of German U-boat fleet later German subs would swarm that year. In the early morntransatlantic convoys. The Ger- Bell Island’s Scotia Pier was accidentally hit by a torpedo from a German ing of Nov. 2, the German Umans sunk thousands of sup- submarine in November 1942. This was one of the few attacks on North 518 fired torpedoes at the ply and escort vessels this way. American communities during the Second World War. Canadian steam merchant As technology and strategies Rose Castle, anchored just off evolved, the war found its way to Canada’s doorstep. U-boats the island. Coincidentally, this ship had narrowly avoided mispatrolled the waters off Newfoundland in the autumn of 1942, fortune two weeks prior, when it was hit by a dud U-boat torstalking like sharks around a significant iron ore mining dis- pedo that failed to explode. This time, 23 crew members were trict just west of St. John’s. killed when it sank. Before slipping away, U-518 also destroyed Bell Island, a rugged nine-by-three-kilometre landmass in PLM 27, which had survived the earlier September attack. Newfoundland’s Conception Bay, had been home to continuDuring U-518’s November strike, a torpedo, destined for ous iron ore mining since 1895. Before the war, the island’s the coal ship Anna T, missed and instead hit Bell Island’s Scotia mines shipped most of their product to Germany. But after Pier loading dock, causing more than $30,000 in damages. Canada’s declaration of war in September 1939, the majority This made Bell Island one of the few North American commuof its iron ore was sent to steel mills in Sydney, Nova Scotia, to nities to be directly fired upon during the Second World War. contribute to wartime shipbuilding efforts. All of this made Residents of Bell Island were shaken by these events and tiny Bell Island an important asset for the Allies, but also a the October sinking of the SS Caribou, a passenger ferry en strategic target for the Germans. route from North Sydney, N.S. to Port-aux-Basques, N.L., U-boats started attacking vessels along the East Coast ear- which claimed 137 lives. Yet production at the mines and lier in 1942, picking off mainly ill-prepared American ships at shipments of ore persisted until the end of the war. will after Germany’s official declaration of war against the When the iron ore demand from the war and the subseUnited States in December 1941. Between January and August quent rebuilding of Europe ceased, so did mining on Bell 1942, more than 600 merchant ships were destroyed off the Island. Its operations could not compete with cheaper extracEast Coast, killing thousands. tion methods employed elsewhere. On April 19, 1966, the last Celebrated German “ace” Rolf Ruggeberg, captain of U-513, of Bell Island’s six mines were closed. Over the course of its 71had been hunting Allied ships in the waters around New- year history, more than 79 million tons of iron ore were foundland since August. Observing steamer traffic outside of extracted. Conception Bay, he followed a small ship into the bay on Sept. Today visitors can take guided tours of the Bell Island mine, 4 and came upon three ships anchored outside Bell Island. or dive down to explore the wrecks of the four doomed Allied Ruggeberg waited out the night and then, on Sept. 5, he fired ships, sunk by German U-boats that might even have been on the bulk carrier Saganaga while it was waiting for a convoy built with some of the island’s high-quality iron ore. CIM 74 | CIM Magazine | Vol. 9, No. 7

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