WINTER 2015
Risks and rewards BRM Developments making progress at Lake Ianthe
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Winter, 2015
Contents
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10 Risks and rewards BRM Developments says there were risks attached to developing it’s mine at Lake Ianthe on the West Coast. 14 New eyes on old data A $4 million, government funded gold research initiative lead by GNS Science is starting to gain momentum. 16 Strength in adversity In the 1870’s the ‘Seven Irishmen of Tinkers’ developed the Undaunted Mine in Central Otago in the face of extreme odds.
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21 A lasting legacy Holcim Westport has been recognised for its efforts in undertaking a major rehabilitation of its Tauranga Bay quarry site at Cape Foulwind.
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Changes may impact on Golden Bay exploration Jo Bailey Mining and exploration activities in Golden Bay could be severely impacted if the region becomes protected under a proposed Tasman District Council Plan Change. A report, prepared by a community-led ‘Small Group’ of eight stakeholders, has recommended that most of Golden Bay and the Northwest Coast be identified as ‘Outstanding Natural Landscapes’ (ONL), and ‘Outstanding Natural Features’ (ONF), which could restrict mining and minerals activity. Chris Baker of Straterra says MOD Resources, with a gold exploration target at Sam’s Creek, and Strategic Elements, which has a prospecting permit over the former gold mining area of Tai Tapu, are directly affected and actively engaged in the consultation process. “Hardie Resources is also potentially affected. Straterra has been working with all three companies on this issue.” After engaging with Straterra and affected minerals interest, Tasman District Council has arranged for public submissions to the draft report, and for the Small Group to reflect the concerns of the minerals sector (which were not previously considered), in producing its final report. This report has now been written, and presented to the council. Certain criteria under clause 6(b) of the 1991 Resource Management Act must be met in order for a feature or landscape to achieve ONL or ONF classification. They must be considered remarkable for a combination of reasons – physical presence and qualities, beauty, and meaning for those who live and visit there.
Chris Baker Once identified, the Council is then required to protect any outstanding natural features and landscapes from inappropriate subdivision, use and development. “At issue is where the ONLs are designated, and what rules would apply within ONLs. “Our view is that if the entire region is to be classified as outstanding, it cannot be outstanding, by definition. “Arguably, all of New Zealand is outstanding under this interpretation.” Baker says Straterra is also of the view that every mining project presents unique issues, and, therefore, should be considered case by case.
“Each project needs to be considered based on what’s proposed, the likely environmental effects, and how they would be managed to meet the tests in legislation, that is, sustainable management under the RMA, and the protection of conservation values under the Conservation Act 1987.” Tasman District Council intends to carry out a workshop with the report writers in September, ahead of finalising draft district plan provisions on outstanding natural landscapes, for public submission in October. That step would begin the formal RMA planning process. Baker says providing stronger national or central government direction to councils has been identified as a major component of the Government’s proposed RMA reforms. “We have come to the view that stronger national direction is required for issues such as outstanding landscapes, as well as air quality, and providing appropriately in RMA policy statements and plans for minerals exploration and mining.” “The reforms have taken longer than expected to come to fruition; however, a Bill is expected later this year.” Straterra has been engaging with the national direction team at the Ministry for the Environment on this and other issues. It has also been working with the Rules Reduction Task Force, set up in the Department of Internal Affairs (following work done by the Productivity Commission last year). Straterra will continue to advocate on behalf of the minerals companies affected by the proposed classification changes at Golden Bay. “We foresee a busy period ahead with this planning process one of a number occupying Straterra’s attention in New Zealand.”
Newmont sale still in waiting game Karen Phelps Newmont Mining Corporation is still in the process of selling its Waihi mining operations to OceanaGold Corporation. Omar Jabara, group executive corporate communications for Newmont Mining Corporation in Denver, confirmed that the company is continuing toward securing the necessary approvals to close the transaction. “We don’t have a firm date, at this point, as some of the approvals are not within our control. We continue to expect the transaction to close this quarter,” says Jabara Newmont has entered into a non-binding letter of intent with OceanaGold, which intends to acquire the business by purchasing Waihi Gold Mining Company Limited, the New Zealand holding company for Newmont’s Waihi operations. All of the company’s current existing New Zealand contracts will be transferred directly to the new owners of the company. All consent conditions will remain the same and closure bonds and conditions set by local regulators will remain in place. The sale is subject to approval under the Overseas Investment Act 2005. OceanaGold Corporation has indicated that factors,which influenced the company to purchase the Waihi mining operations include the fact that the proposed acquisition is accretive to shareholders, grows OceanaGold Corporation’s production profile and will further reduce the company’s All-In Sustaining Costs. There are also synergies with OceanaGold Corporation’s existing operations in New Zealand including the mine life extension to the Frasers Underground Mine.
Chatham Rock seeking further funds from farmers Hugh de Lacy Confident of the eventual success of its marine consent application to mine phosphate nodules off the Canterbury coast, locally listed company Chatham Rock Phosphate (CRP) is tapping farmers for fresh finance. The company has recently advertised in rural papers seeking $766,000 from farmers for a stake in the local supply of a key farm fertiliser product that otherwise has to be imported from the Middle East.
CRP chief executive Chris Castle said the farmer inquiries were beginning to flow in, and he’s confident the company will eventually get the consent it was denied in a hearing at the end of last year. Castle said that no date has yet been set for the new application, “but we’re working with the Environmental Protection Authority [EPA] at the moment on how things will happen next time – we’re developing a collaborative relationship with them”. Presently the parties are sorting out the process that will surround the second application
after CRP became the second of two marine ventures – the other was Trans Tasman Resources’ ironsands extraction project off the West Coast of the North Island – that were unexpectedly declined by the EPA within months of each other. Castle said his confidence in the success of the next application is based in part on the fact that the first one was “turned down on quite limited grounds anyway”” He believed many of the outstanding issues could be dealt with “just by communicating better” with the authority.
Chris Castle
Winter, 2015 » Mining NZ 5
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The past gives an eye to the future Jo Bailey The heritage theme at this year’s Minerals West Coast conference saw around 170 delegates looking at the past, as well as the present and future of the mining industry in New Zealand. Minerals West Coast chair Hugh Grey opened the forum, held at Shantytown in late July by asking, “if you don’t know how you got here, how do you know where you are going?”. Keynote speaker Kit Wilson also touched on mining heritage, summarising it as what the industry “leaves behind” which is ultimately, what it will be judged on in the future, he said. Chris Baker, of Straterra, event organisers alongside Minerals West Coast said the theme was chosen to tie in with the 150th Anniversary celebrations on the West Coast. “One of the highlights of the forum was the presentation of the Environment (heritage) award to the Waihi Heritage Vision, WWI New Zealand Tunnelling Company Project. “The group is more than half-way through an extraordinary 10-year project to remember the New Zealand tunnellers who enlisted in the First World War, using their skills as miners, engineers, surveyors and Public Works officials to mine under enemy lines on the Western Front.” Representatives of the major mining companies kept delegates up to speed with their current operations, and although the industry is facing challenging times, Baker says the mood at the forum was still positive. “There was a mixture of current market discussion, optimism and good stories such as Evolution Mining and Newcrest; the consolidation of OceanaGold and Newmont; and the current interest in garnet, ironsands and Barrytown ilmenite on the horizon.” He says the popular AustMine “speed dating” session was another great success; with a conclusion reached at the end of the Women in Mining New Zealand session that more
Shantytown was an appropriate venue for this year’s Minerals West Coast forum which had the theme of mining heritage. opportunities need to be provided for leadership mentoring, and to attract more women to the industry. Ilana Miller, new National Minerals Manager (NZP&M) spoke about the new operational
guidelines being developed in collaboration with industry including Straterra and Minerals West Coast, which should be released in September. Bernie Napp of Straterra ran through some of the RMA and other policy work the organisation is
MWC chief moves on to School of Mines West Coast minerals industry identity Peter O’Sullivan has just been named as the new director of Tai Poutini Polytechnic’s (TPP) School of Mines. TPP chief executive Allan Sargison says it is a “real coup” for the Polytechnic to secure O’Sullivan in the role, after he left TPP five years ago to work for Minerals West Coast. “We are incredibly pleased to welcome Peter back to the Polytechnic, where we know he will have a significant impact on the training programmes we provide. He is highly regarded by industry and has excellent contacts within the New Zealand minerals sector. We look forward to having him on board.” O’Sullivan says he is looking forward to the role and utilising his extensive networks to develop the mining training programmes on offer at TPP so it becomes the mining trainer of choice across New Zealand.
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Exploration programme management Geological mapping and 3D modelling Resource evaluation and certification Mine drainage consulting, research, sampling and testing - Gas content testing of coal
6 Mining NZ » Winter, 2015
Peter O’Sullivan The West Coaster is enthusiastic about the future of the industry, and sees higher-level training as a potential growth area for the Polytechnic.
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“Previously there have been opportunities on the Coast for people to secure a well-paid operational job in the mines, but if you were interested in a management or specialised role you would have to go to Australia to get the training. ‘I’m keen to investigate some cadet-style programmes that lead to higher-level training for those who wish to progress.” O’Sullivan says the quarrying and aggregate sector is particularly buoyant and there is scope for TPP to become more involved in health and safety training as the industry comes to grip with new and emerging mining regulations and guidance. “I’m really looking forward to getting started and making a positive contribution. TPP has been working in this area for some time and is doing a superb job. “I am starting from a good, solid platform and am looking forward to building on that.”
New Brisbane joint venture - CB3 Ltd Spontaneous combustion testing Combustion analysis and testing Gasification and carbonisation research Advanced nano-materials research and development Coal and minerals processing research
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involved with; and Brett Cummings from the Gold Miners Association also spoke on the ‘working together’ theme. Baker says that health and safety was, as always, another key focus of the forum, with presentations from Les McCracken of MinEx, and Tony Forster, the Chief Mines Inspector at WorkSafe NZ on the ongoing changes and what they mean for industry. West Coast mining identity Glenys Perkins spoke about the topic on behalf of industry. “There has been a high level of concern, particularly from alluvial gold miners about how they would manage under the new regime,” says Baker. “However, the progress made over the last few months, and discussions at the forum have helped to reduce these fears considerably.” Peter O’Sullivan, the chief executve of MWC announced his resignation at the Forum, to take up a position with Tai Poutini that will see him continue his positive contribution to the minerals sector on the Coast and around the country . O’Sullivan was thanked for his work as MWC chief executive officer, and will continue as a Board member. Overall, Baker says the forum was “another good event”, with the words respect, and collaboration, coming to the fore. “We also got a sense of our history as an industry on the West Coast, and a feel for the current mood of the sector, which is still one of dynamism.” • Waihi Heritage win - page 20
Coal and combustion testing Chemical analysis on fuels Water analysis - domestic to industrial Magnetic and density mineral separations X-ray diffraction and X-ray fluorescence (XRF & XRD) Acid base accounting and kinetic testing
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New tool aims to improve reports Jo Bailey Geological consulting and contracting firm RSC is launching a “game changing” new tool for managing the quality of public reporting of exploration results, mineral resources and reserves. Just released on RSC’s new website is RSC Mineral Intelligence (RSC-MI), an interactive online map which shows all the activity on the global mineral resource development stage since October 2014, when the firm started monitoring (www. rscmme.com/mineral -resource-map). The map data is updated daily by the company’s resource consultants and includes all public reports for CRIRSCO affiliated codes such as JORC and NI 43-101, which can be downloaded for free. RSC director, Rene Sterk says in the past, these code compliant reports had been difficult to source from one place. “We used to spend hours googling and searching, as there was no one (free) site where you could access the reports all at once. That’s why we decided to create RSC-MI.” Since the new website and interactive map was developed, RSC has developed opportunities to extend the initiative, which is where the “game changing” aspect of the project comes in. RSC is enlisting industry experts to provide independent, open-peer reviews of the reports, and rate them, in similar fashion to sites such as the travel site Tripadvisor. But unlike Tripadvisor where anyone can post a review, the RSC-MI reviewers must qualify as a competent person with five years minimum experience in a certain commodity, says Sterk. “Other professionals are telling us the openpeer reviews could improve the overall standard of public-code compliant reporting in the global mining industry.”
Rene Sterk Responsibility for the quality of a public report currently lies with its author, and although existing review systems catch some important occurrences of non-compliance, this only happens if contraventions of the code are reported. “Even then the lengthy process of making and investigating a complaint obstructs the capture of many breaches,” he says. “Similarly, the system has ineffective control on the general quality of reports.” Using a five-star rating system, each report will be assessed by reviewers for transparency, materiality, competence, compliance, and technical quality. Customised outputs are made publically available to all users and include overall rankings of report quality (based on review averages) with options to filter for location, name of consultants,
commodities, dates, and various quality designators. “It will become evident who are the top-quality reporters, and conversely, which reporters have compliance and quality problems”, says Sterk. RSC has had 50 people registering to be reviewers before the initiative is going live later this month, and is looking for more suitably qualified people from all around the world who are keen to be involved. “It’s a novel approach to an issue that has been around for a number of years but hasn’t yet been resolved. Ultimately we hope the reviews will also lead to an overall reduction of code breaches which would be a big win. It is important to note that we’re not intending to just expose, but aim to improve by establishing direct contact with authors of reports.” The project has been a labour for love for Sterk, costing “tens and thousands of dollars and many sleepless nights”. It will continue to take a considerable amount of his time as the system is updated daily and includes drilling updates, resource
estimates, scoping studies, feasibility studies and optimisations, as well as all public reporting and soon valuation reports. Despite this, he is happy to give away the information for free, at least in the short term. “As the first movers and industry leaders of this initative we hope it will bring some recognition to the company. We could easily spend the same amount on conventional advertising, so it’s another way of getting our name out there.” He believes there could be similar spin-offs for the site’s registered reviewers. “I’m hopeful the reviewers’ profiles on the site could lead to work for them, and they will also be able to pick up professional development points from their involvement.” RSC has also started a Seabed Mining and Exploration page on its website, a portal for the latest information from the sector in which RSC has developed expertise. “We’re getting positive feedback from around the world for this project too, with people saying it’s great to have a daily pick-up of seabed mining news in one spot.”
TTR eyes West Coast sands Hugh de Lacy Never mind the knock-back from the Environmental Protection Authority (EPA) late last year, listed company Trans Tasman Resources (TTR) has bounced back into the game, exuding confidence over the future of both of its marine mining projects. TTR suffered a severe blow when the EPA turned down its marine resource consent application to mine ironsands off the west coast of the North Island, to the degree that it was forced to let go all but four of its 30 staff. But while it was exploring its further options on the ironsands project, it also took its marine mining model and expertise to the West Coast of the South Island, targeting heavy mineral sands close in-shore between Ross and Karamea. Earlier this year the company applied to NZ Petroleum and Minerals for a prospecting permit covering 4436sqkm of seabed. Since the entire prospect is within the 12-mile limit, it does not require a marine resource consent from the EPA under the Exclusive Economic Zone Act, but a standard resource consent under the Resource Management Act from the Westland District Council.
Meanwhile, the ironsands project is back on track with a second application to be lodged with the EPA before the end of the year, the company’s executive chairman, Alan Eggers, said. In the wake of the declining of the application last year, TTR first tried to appeal, only to find that the road back to EPA’s decision-making panel was blocked by the EPA’s inability to reassemble it within a reasonable timeframe. Eggers said the company had further addressed the science behind the EPA panel’s concerns, and he was confident the second application would be able to dispel them. The South Island heavy mineral sands prospect was a natural fit with the ironsands project, he said, since both anticipated operating in a water depths of 50 metres. More importantly, at 14% the West Coast’s sands held a high proportion of heavy metals – particularly ilmenite, garnet, gold and zircon – compared to similar sands in South and West Australia which typically yielded in the 4-5% range. The area for which TTR is seeking the heavy minerals prospecting permit has previously been explored by both the global giant Rio Tinto and the since-liquidated Toronto-based Seafield Resources, but neither took the project any further.
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Waiuta remediation work awaits new information Jo Bailey Work on remediation of the contaminated Prohibition and Alexander mine sites at Waiuta on the West Coast has been put on hold to allow for further detailed design work. Roy Grose, the Department of Conservation’s acting Conservations Services Manager, North and Western South Island says DOC is getting additional engineering advice on the design of the encapsulation pit for containment of the contaminated arsenic material, after the project was found to be more complex and challenging than anticipated. “Together with the Ministry for the Environment we have decided it is more efficient to put site work on hold and review the project, in order to preempt and prepare for any unexpected issues and additional work requirements associated with the remediation work”. The materials the pit was to be built from have been found to be unsuitable for the area’s wet weather conditions. In addition, Grose says it had been originally intended to contain contaminated material from both the Prohibition and Alexander mine sites in one encapsulation pit at the Prohibition site. “It is now considered more practicable and less of a risk to have a separate encapsulation pit at the Alexander mine site for its contaminated material if a suitable site can be found for it.” This solution would avoid transportation of contaminated material from the Alexander site to the Prohibition site. “We want to get this right, and taking a step back to re-evaluate the work required is the way to do that.” In July 2013 the Government announced a plan
The old Waiuta mine sites have been described as New Zealand’s most toxic. to remediate the old Waiuta mine sites, which have been described as New Zealand’s most toxic. The Prohibition Mine site was contaminated from the operation of a roasting plant which was used in the extraction of gold from the ore, which was used from 1935 until the mine collapsed in 1951. The entire town was later deserted. When the Government announced plans to carry out the site remediation, costs were estimated at $600,000 and work was expected to begin later that year. The project costs have since blown out to over
$3 million, which Grose says is due to detailed project scoping and planning started a couple of years ago. “The cost of the project rose as the complexity was better understood.” The project review is expected to take approximately two to three months and will make recommendations about the next steps for the remediation project. “We’re planning to have the remediation back underway for the dry summer spell that typically occurs from January,” says Grose.
China move lifts gold price Hugh de Lacy China threw a declining international gold market a lifeline when it surprised markets by devaluing its currency 2% in mid-August. A devaluation of the yuan has been on the cards since the Shanghai stockmarket began its 25% slump earlier in the year, at a time when China was also experiencing a sharp drop in its exports. The immediate effect of the devaluation was to knock a few more chips off the gold price, dropping it to around $US1093/ ounce ($NZ1656/oz), but that quickly reversed as investors realised the implications for the US dollar which is on track for a Federal Reserve rate hike in September. That now looks much less certain, the increasing strength of the US economy notwithstanding, and gold benefited by clambering to a four-weeks high of around $US1108/oz ($NZ1679/oz). However, two other factors in the Chinese gold market make the immediate future of global gold demand a little more murky. The China Gold Association revealed this month that consumption had fallen only 1.4% in the first half of 2015 – the Hong Kong market had suggested a greater drop – which may mean China will have to replenish its bullion stocks over the second half of the year. Offsetting that is the growth of China’s domestic gold-mining output in the first half of this year. Already the world’s biggest gold producer – since 2007 – China grew its production a robust 8.4%, enough to absorb 40% of industrial, private jewellery and investment demand. All eyes will now be on the US Federal Reserve, presses ahead with its rate hike.
Govt invests in more aeromagnetic surveys Jo Bailey The government is to spend $6 million on regional aeromagnetic surveys, to provide good quality data for explorers and miners. Minister of Energy and Resources Simon Bridges announced the news at the recent Minerals West Coast Forum, saying high quality data was vital to attracting investment. “Providing comprehensive information to potential investors helps New Zealand compete on the international stage for resources development. Good data can tip the balance of investment decisions in our favour,” he said. The surveys will cover more than 23,000sqkm across Nelson, Marlborough, parts of Otago, and
Southland. An area of more than 3700sqkm will be surveyed over East Nelson and Marlborough, where potential for base metals such as copper, and other metallic minerals including nickel and platinum has been identified. Although there has been some aeromagnetic coverage over Otago in the past, the new surveys, covering nearly 20,000sqkm in Otago and Southland will help build a consistent picture of prospectivity over the whole region, said Bridges. “The Otago survey areas are prospective for gold and tungsten, with the areas around Queenstown and Southland prospective for chrome, nickel and platinum group metals.” The surveys are expected to begin in November, apart from the North Otago regional survey, which should begin in November 2016.
Bridges says the government is working with local councils that may want to contribute so the surveys can be extended to “gain as much as possible” from the endeavour. As well as contributing to the geological understanding of New Zealand, the data can also be used to support geological mapping, forestry, agriculture, horticulture, geological hazard assessment, and engineering and construction investigations. “These surveys, when combined with the other surveys by Government and industry, will mean aeromagnetic data has been gathered over thirty per cent of New Zealand. “That’s a massive leap from where we were five years ago.” The Government has also allocated $400,000
to undertake a series of prospectivity studies to better understand New Zealand’s resources and regional geology. The results of these studies and the aeromagnetic data will be put into a National Minerals Exploration Datapack. This will be available to explorers, allowing them to begin their work at a “more advanced level of exploration,” said Bridges. “This is about supporting companies with information so that they can explore and use their resources more efficiently. “It should allow them to drill sooner, accelerating potential discoveries and mining,” said Bridges-. “This is positive for regions, for the industry, and for New Zealand.”
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Pioneer scientist made his mark Jo Bailey A new book, celebrating the life of pioneer explorer and geologist James Hector, brings some long overdue recognition to one of New Zealand’s pioneering scientists. Being launched in mid-September - ‘James Hector – explorer, scientist, leader’ - has been written by eminent geologist and science historian Simon Nathan, who says the many achievements of Hector, a dominant personality in nineteenth century science in New Zealand, had largely been forgotten. “In 2007 I helped to put together a booklet on Hector to mark the centenary of his death. “During my research I realised most of what was written about him was pretty old and no proper biography had been published.” Hector was a Scottish-born scientist, who was appointed by the government in 1865 to set up the Geological Survey of New Zealand (the forerunner to GNS Science) and to supervise construction of the Colonial Museum (now Te Papa), which was the Survey’s headquarters. As the chief government-appointed scientist of the second half of the nineteenth century, he controlled virtually every aspect of state-funded science and laid the foundation for numerous other scientific bodies, such as the Crown Research Institutes, the Royal Society, and the Meteorological Service. In 1869, Hector produced the first geological map covering the whole of New, Zealand putting this country among only a handful of nations to have full geological mapping at the time. His other achievements include standardising New Zealand time; introducing conifers such as radiata pine and macrocarpa; starting a national earthquake recording system (the forerunner for today’s GeoNet); and being one of the first observers to report on the disastrous 1886 Tawawera explosion.
Hector also had a special interest in whales and dolphins in New Zealand, establishing a collection of skeletons in the Colonial Museum alongside a host of other fascinating artefacts. The Hectors Dolphin is named after him. Although Hector was a well-known public figure of the late 1800s, Nathan says little was known about his private life, an aspect he enjoyed researching for the book. “Hector married well, to Maria Georgiana Monro, daughter of the speaker of the House of Representatives. I found some information about his personal expenditure, which showed he was a canny Scot, who managed his money carefully. He was also very ambitious, so whenever an opportunity came along, he took control.” Nathan says Hector appeared to get on well with most people, although he was “always arguing” with fellow geologist, explorer and curator of the
Author Simon Nathan: “I have enormous regard for James Hector.”
One of James Hector’s many achievements was to produce the first geological map of New Zealand. Hector managed to pull together all the information from his own and other people’s surveys to produce the map, which was completed in 1869. Canterbury Museum, Sir Julius von Haast. “I transcribed a lot of letters Hector wrote to a variety of people including von Haast and Sir Joseph Hooker, who was president of the Royal Society in the UK. They provided a lot of insight into what was going on behind the scenes, including Hector’s disagreements with von Haast.” Nathan says working with the letters was a challenging process, given Hector’s “awful” handwriting. Nathan is a geologist himself, with much of his career spent at GNS Science researching the geology of the West Coast. He was awarded a DSc for his publications on the region and later studied the Kermadec Islands. From 2003 until 2007 Nathan was science editor for Te Ara, the online encyclopedia of New Zealand, and designed the entire section on mining and minerals. Following his retirement from this role, he has continued to write science history. “I’ve always been interested in history, and after working for Te Ara I knew my future was in writing. As a geologist the body starts to wear out as you get older.”
Nathan has also written biographies of Harold Wellman (who discovered the Alpine Fault), and Joseph Divis, a colourful Czech-born miner and photographer, who spent much of his adult life at Waiuta. Many of Divis’ carefully composed images feature in the book, and provide a fascinating record of the mine, town, and its people during the 1920s and 1930s. Nathan was pleased to see James Hector’s legacy finally recognised with the erection of a plaque at the site of the old Colonial Museum, behind the Beehive, in late July. The ceremony was attended by some of Hector’s descendants. “I have enormous regard for James Hector. He got to where he was by being extremely hard working, organised and dedicated to science, as well as being the right man in the right place at the right time.” • AusIMM has partly-funded ‘James Hector – explorer, scientist, leader’, with preview copies to be presented to speakers at the organisation’s upcoming conference. From mid-September it will be available from bookshops nationwide.
Winter, 2015 » Mining NZ 9
Gold » BRM Developments
BRM making inroads at Lake Ianthe Jo Bailey Andrew Birchfield says it was a risk for his company BRM Developments to start mining at Lake Ianthe, where several other gold miners had already tried and failed. “I remember a transport driver telling me he had brought a lot of gear into Lake Ianthe for miners and ended up taking it out again for finance companies,” he says. “It was a bit of a risk but we had some good advice from different people and the gold price of NZ$2100 at the time made it worth a go.” For three months before he made the final decision to establish the mine, Andrew explored the area above Banford Bay himself, digging holes, panning, and opening up roads. “The area was a sluicing plain back in the 1930s and some previous miners in the 1980s and 90s had had some success. “We’d been told there was definitely gold there but no one had gone deep enough. When we did some drill holes we found gold down to 53 metres.” This was enough evidence for Andrew to start developing BRM’s open-cast alluvial mine around two years ago. “We haven’t got down to those depths yet, as we are still widening the hole and making it safe.” BRM’s hardworking team of 13 cover a six day week for up to 11 hours a day. “We have a good team and it’s great to employ local people from the likes of Hokitika, Ross and Hari Hari.” Andrew says production so far has more than met his expectations. “We’re getting plenty of beer money out of it.” The strong production and growth of the company has led BRM to invest in some new gear to get its processing plant up to full production. “We use a Pan-American jig plant instead of conventional tables, with four primary and one secondary jigs. “Although it has cost a bit more to set up, the jig plant has paid for itself pretty quickly.”
Developing the open-cast mine at Lake Ianthe has had its challenges, but progress is being made. Other gear has been bought as needed to help meet the challenges of the mine. “There are a lot of big rocks down there which is why we have to keep upsizing our gear. We started with a 50-tonne excavator, but earlier in the year we purchased a 90-tonne Hitachi 870 excavator.”
“We’d been told there was definitely gold there but no one had gone deep enough. When we did some drill holes we found gold down to 53 metres.” Other recently acquired plant includes two Cat 773E dump trucks, a grader, and a smaller Hitachi 470 excavator which arrived in June. “We’ve only sold one dump truck since we started the mine. GE Finance, Cable Price NZ Ltd and the McSkimming’s at Global Tractors have looked after us really well as far as the new purchases go.” Ianthe Mine is in glacial country, which provides another challenge for the BRM team, says Andrew. “Glacial country can run hot and cold. We haven’t hit any cold spots yet, but they will come as we get close to the front of the glacier.” Andrew is a third generation West Coast miner and a director of BRM Developments alongside his brother Paul who is the firm’s industrial electrician. The company is run from the same offices as Birchfield Mining - which is owned by their parents Evan and Jane. Jane is also a shareholder of BRM. Andrew’s wife Maxine runs the office with Jane
10 Mining NZ » Winter, 2015
Birchfield, and both keep a close eye on the mining operations, he says. “They’re the ones who let us know if we’re spending too much money or need keeping in line.” Andrew says BRM is pleased to have a good relationship with Ngai Tahu, which owns the land at Lake Ianthe. “They are really helpful and good to work with.” BRM has licenses over around 5000ha but is about to drop this back to 1800ha to let others take up the balance. “We also have a separate license on Hitchins Hill, and another being processed by NZPM to mine ancient beach leads. Our drill results for this project have been really positive so far.” Andrew says it is still early days at the Ianthe Mine, which makes it hard to estimate the mine’s life. “If we go to depth, I believe there is the possibility of it being a 10 to 15 year mine, which would be great.”
Gold » BRM Developments
BRM Developments director, Andrew Birchfield, left, and Stewart McSkimming, of Global Tractors at the Lake Ianthe mine site.
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www.globaltractors.co.nz Winter, 2015 » Mining NZ 11
Gold » OceanaGold
OceanaGold on acquisition trail Jo Bailey OceanaGold is set to acquire Toronto-listed Romarco Minerals Inc in a cashless purchase, that could boost its gold production to more than 500,000 ounces of gold a year, and position it as the lowest cost gold producer in the world, says chief executive Mick Wilkes. “The combination of the sector low cost profile with significant free cash flow generation, diversified production and a pipeline of organic growth opportunities forms the lowest cost gold producer globally.” Romarco’s principal asset is the Haile Gold Mine in South Carolina, United States, a high grade open pit, currently under construction. Once the mine is operational, around 75 percent of production is expected to come from OceanaGold’s assets in New Zealand and the United States, with annual estimated production of 540,000 ounces of gold by 2017, with an all-in sustaining cost of less than US$600/oz. The acquisition of Romarco is based on issuing new OceanaGold shares in exchange for Romarco shareholders’ shares with no cash component. OceanaGold shares in the market will rise from 303.5 million on issue to 603 million. The deal is subject to it being accepted by 66 percent of Romarco shareholders who will vote in either late September or early October. On completion of the arrangement, existing OceanaGold and Romarco shareholders will own approximately 51 percent and 49 percent of the company respectively. The announcement of the acquisition comes just a few months after OceanaGold entered an agreement to purchase Newmont’s Waihi gold mine for US$101 million. Wilkes says the inclusion of low-cost production from Waihi, and the weaker New Zealand dollar has left the company “well positioned” to continue delivering positive results. In the second quarter the company reported revenue of $125.5 million which was down on the first quarter but expected due to lower outputs at Didipio and Macraes. Trading results announced for the first half of the calendar year, saw OceanaGold produce 176,000 ounces of gold and 12,299 tonnes of copper, making it “well on the way” to achieving its calendar year production guidance of between 295,000oz and 335,000oz of gold, and 23,000 tonnes of copper. In New Zealand, the company’s Globe Progress Mine at Reefton will cease in the third quarter,
OceanaGold’s Didipio operation in the Philippines continues to perform well. with stockpiles supplementing the mill feed for the remainder of the year as the operation transitions to care and maintenance. The mine closure has been flagged for some time, with the end date pushed back several times. Of the 120 employees in the mining department, around six would remain on site once the mine moved into care and maintenance. Encouraging drill results have been reported at the Macraes Goldfield, which have the potential to increase the mine life. The company initiated a targeted brownfield exploration programme at Macraes earlier this year,
R/C High pressure Coalbed methane Geothermal Diamond core Horizontal drainage
focused on four specific areas peripheral to existing and previous open pits. Initial drilling has produced “significant results” that demonstrate the potential for increased reserves, says Wilkes. “We will continue drilling primary targets along the 30km strike length and underground at the Frasers operation to further identify mineral resources that have the potential to increase the mine life at Macraes.” OceanaGold has also committed to advancing the Macraes Gold Tungsten Project to the feasibility stage. The company’s Didipio operation in the
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Philippines continues to perform well with significant annual costs savings expected once the process plant switches to grid power by the fourth quarter. A geophysical survey of OceanaGold’s Paco tenements on the island of Mindanao have identified drilling targets, which should be explored in the third quarter. Looking ahead, Wilkes expects the company to deliver strong results in the second half of the year. “OceanaGold is uniquely position to continue generating significant free cash flows. “We have a strong balance sheet, a suite of high quality assets and organic growth opportunities.”
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Gold » Industry News
Correnso production starts Karen Phelps Production has started at Newmont Waihi Gold’s Correnso mine. Mining commenced in July at the bottom of the ore body and is working upwards starting at around 300 metres deep and finishing at least 130m below the surface. Newmont Waihi Gold has stated that a panel of ore up to 15m deep is being drilled and then blasted. As each layer of ore is removed the void is backfilled with waste rock then 50 tonne mining machines drive over the backfill as they work upwards so that by the time all of the ore is removed the stope has been filled and the ore replaced with tight-filled rock. It was in 2011 that Newmont Waihi Gold applied for consent to construct and operate an underground mine in the Golden Link Project Area. Consents were granted under the Resource Management Act by the hearings committee however these consents were objected to by several appellants and the decision was referred to the Environment Court. Agreement was reached following court assisted mediation between the company and the appellants and Newmont Waihi Gold received consent from the Environment Court to construct and operate an underground mine in an area smaller than the area originally applied for. This reduced area, called the Correnso Extensions Project Area (CEPA), allowed Newmont Waihi Gold to construct and operate an underground mine anywhere within the CEPA area provided that all consent conditions were met. The consent conditions outline the various activities that can be undertaken by Newmont Waihi Gold and require the company as the
Hugh de Lacy
On the way: a drilling jumbo at a depth of 300 metres at Correnso.
consent holder to adhere to limits for noise and vibration, monitor all activities and produce a range of regular reports. The consents also specify activities such as backfilling and blast times. The Correnso exploration development drive, which comes off the Trio mine and heads north underneath residential properties in Waihi East, was completed at the end of April 2014. It was constructed to allow Newmont Waihi Gold to drill into the Correnso ore body to gain a better understanding of the extent and grade of
Fire protection crucial for expensive mine equipment Protecting mining equipment from fire could save companies millions of dollars, says Steve Benseman from Fire Suppression Systems. “If companies have a complete burn-out of one of their key pieces of equipment, it could be out of action for up to a year which would cost them an awful lot of money.” Benseman says the lead time to replace highly specialised mining and construction equipment is currently around 50 weeks from when an order is placed to when it arrives in New Zealand. “That’s why it is imperative companies protect their existing machinery as the combination of large amounts of fuel, hydraulic oil, extremely hot surfaces and electrical components create an operating environment with an inherently high fire risk.” Benseman has 13 years experience in advising, installing and maintaining fire suppression systems at New Zealand mine sites. He says it is important companies deal with a specialist such as Fire Suppression Systems to ensure their systems meet the testing and certified standards required of the industry. “Some of our competitors dabble in fire suppression work outside their core business, but I believe we’re the only company in New Zealand to focus solely on mobile equipment fire suppression.” Fire Suppression Systems offers a full range of systems for the mining, construction, drilling, forestry and mobile equipment industries. Benseman is based in Auckland and employs three mobile technicians who operate from other parts of the country. Between them they visit clients’ often remote sites in fully set-up vehicles that enable them to provide complete equipment install, maintenance and servicing on-site.
New Talisman takes another step forward
We pride ourselves
the ore body and involved Newmont Waihi Gold constructing a tunnel over 200 metres beneath the surface and drilling core samples. It was the first time that such a project had been undertaken in New Zealand by the gold mining industry directly under residential properties. Newmont Waihi Gold has announced that the first phase of Correnso, which involves the mining of the known reserve, will be completed by mid 2017 by which time it will have produced 300,000 ounces of gold.
New Talisman Gold Ltd (NTL) has scored a decisive court victory against opponents of its bulksampling and exploration at its historic mine in the Karangahake Valley near Waihi in Hauraki District. The Protect Karangahake group has discontinued its application for a judicial review of New Talisman’s resource consent, with the company’s chief executive, Matthew Hill, saying the decision was made in the face of “overwhelming” evidence in the High Court that the Hauraki District Council (HDC) had properly processed the consent application. “We are not overly surprised that Protect Karangahake has resolved to withdraw,” Hill said. “Both NTL and the HDC were prepared to vigorously defend the consent process with detailed factual evidence and affidavits.” He congratulated the council on the “robust rebuttal it provided in response to all the matters raised in the application for a judicial review.” The company would now complete its traffic management plan for the underground mining operation for which it has consent to extract up to 20,000m3 of ore. It is currently preparing an offer to shareholders to raise further funds “to expand its operational reach and develop the full suite of activities”. NTL is listed on both the New Zealand and Australian stock exchanges and has about 1800 shareholders. As well as the permit to mine the 100-year-old Talisman JORC-compliant prospect, it holds an adjacent exploration permit along the mine’s strike.
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The expert team can also provide clients with advice on preventative measures and maintenance practices they can undertake to further reduce fire risk. Benseman is the New Zealand agent for foam fire suppression system Sandvik NFP 1000. Around 18,000 Sandvik systems are now being used worldwide, he says. The system is fully compliant with the new Australian standard AS5062. A key feature is that it is completely selfcontained so even if there is no electricity or person to operate the system it will still activate in the event of an emergency. Benseman says Fire Suppression Systems recently installed fire suppression systems to 115 machines for the Downer/Solid Energy Stockton Alliance on the West Coast, its biggest single install to date. “We continue to look after every other major mine in the country. “We pride ourselves on delivering reliable, proven products that give our customers peace of mind that their equipment and staff will be protected should a fire incident occur.”
Fire Suppression Systems P.O. Box 334081 Sunnynook, Auckland Steve Benseman Ph: 021 918 900, E-mail: sbenseman@clear.net.nz
Winter, 2015 » Mining NZ 13
Industry Focus » Research and Development
Research to cast new eyes on data Jo Bailey A $4 million, government funded four-year gold research initiative lead by GNS Science is gaining momentum, says one of the key researchers, GNS Science minerals geologist, Dr Patricia Durance. The aim of the GEM research project is to upgrade the data held on prospective gold deposits, with the initial focus on Macraes in East Otago, Waihi in the North Island, and Sam’s Creek, near Takaka. GNS staff from Lower Hutt, Wairakei and Dunedin are working in collaboration with researchers from the universities of Otago, Waikato and Auckland to achieve this. We’re still within the first year of the programme. However many of the key researchers involved have now presented GEM-related project results at a number of events, both in New Zealand and overseas including the PACRIM 2015 Congress in Hong Kong.” Dr Durance says that the programme budgeted for four PhD and four Masters students to do graduate work alongside the key researchers. “A number of these spots have been allocated and these students will be arriving over the coming weeks and months to begin their programmes. “The students are in the process of locating their offices and being introduced to their projects. “Once they are settled-in they will get to the business end of their research including conducting field and lab work.” The work will include sampling from existing diamond drill cores made available at the mine sites, and collecting structural data, and soil and rock sampling from the regional areas around existing mineralised structures. Dr Durance says although each of the students’ projects will largely focus on a particular gold deposit style, the GNS and university-based researchers will spread their research expertise
Bruce Mc Keown
Scientific inquiry: Dr Patricia Durance, left, at an AusIMM-sponsored Ore Microscopy course held at Waikato University this year. The course was led by Dr. John Lufkin, right, a consulting geologist from Golden Colorado, US. across a number of gold deposit types to increase the collaborative aspect of the programme. “We’re trying to avoid people being stuck in silos and doing their own thing on one deposit type. We are also mindful of exposing the students to all aspects of the programme.” Dr Durance says since returning from PACRIM, the key researchers have run “the first official
Short courses on mineral systems and airborne geophysics were run before and after the workshop and were very well attended. Some of the questions addressed in the series of talks and which are central to the GEM programme included: what controls the location of gold deposits and why do they form where they do? Where might new gold deposits be
Zane Brown
QUALITY FOCUSED RESULTS
14 Mining NZ » Winter, 2015
GEM event called Mineral Deposit Footprints and Exploration Vectors Workshop”, which was sponsored by AusIMM and held in partnership with Australian researchers from CSIRO. This workshop reviewed the current knowledge and provided case studies in geological, structural, geochemical and geophysical footprints of mineral deposits and exploration vectors to mineralisation.
Craig Pledger craig.pledger@orica.com Commercial Lead NZ 021 926 039
Dean Torstonson dean.torstonson@orica.com North Island Business Lead 021 926 317
Trent Morcombe trent.morcombe@orica.com Technical Service Engineer NZ 021 926 024
Industry Focus » Research and Development
The PACRIM field trip included a tour of Yinshan Mine in South China’s Dexing District. found? What are the features that can be picked up early in the exploration phase to indicate the size of a deposit? How do explorers target and find economic mineralisation inside a prospect? “A question we ask ourselves as researchers is how do we help someone with an exploration licence to pick the best places to drill?” The researchers are working alongside exploration and mining companies including OceanaGold, Newmont and New Talisman, and welcome the involvement of other smaller firms. “The companies are not providing any financial support to the research as such, but have been free with their data and employees’ time which is quite valuable in itself. ‘Now we have access to the legacy data, and data collected during their mining processes for all the key deposits of the programme, which was one of the first-year objectives of the programme. We can now start investigating and building on this data to gain a better understanding of the deposits,” Dr Durance says the programme is assisting the companies to tackle fundamental research
“A question we ask ourselves as researchers is how do we help someone .... to pick the best places to drill?” questions and tasks they may not have had the resources or time to do themselves. “It’s good for the mining companies to have another set of eyes on their data and we are able to explore it in the sort of detail their geologists can’t usually afford the time to do.” She says the wider industry will also benefit from the results of the research programme. “The wider mining community will be able to access the publicly available research results with the ultimate goal to increase incentives to explore for gold in New Zealand.”
Winter, 2015 » Mining NZ 15
Mining Pioneers »
This issue we take a step back to the nineteenth century with the story of the Seven Irishmen of Tinkers, whose tenacity in the face of extreme odds saw them develop the Undaunted Mine in Central Otago. Their incredible story, and that of their benefactor Gilbert Sinclair, was documented in the July 1948 issue of the New Zealand School Journal. Jo Bailey reports.
After completing the 21-mile water race, the Irishmen worked the claimed for many years with great success.
Finding strength in adversity T he discovery of gold in New Zealand in the later half of the nineteenth century saw the arrival of many adventurous, energetic, and hard-working men to the country. Among them was a group known as the Seven Irishmen, who in the 1870s, left behind a life of poverty in Ireland to try their luck in the gold fields of Central Otago. The group included Tom and Peter Flannery, whose mother encouraged them to look for opportunities on the other side of the world as there was “little to be got in Tyrone”, where they were subsisting on potatoes, eggs, buttermilk and stirabout (porridge). However life wouldn’t prove much easier in New Zealand in the beginning, so it was perhaps just as well the men were used to working hard and doing without. Although known as the ‘Seven Irishmen’ there were actually eight, the Flannery brothers, John Leamy, Patrick Murphy, Andrew Murphy, Edward Murphy, Patrick McDonald and John Slattery.
They had been told about a claim at Tinkers (now Matakanui) by Felix Donnelly who worked the nearby Blue Duck claim, and could see it had definite potential. However no one else had taken the claim up because of the huge amount of work that would be required to establish it. “When they (the Irishmen) prospected around, they found there was a great deal of overburden, but there was gold underneath they were sure of that. All they had to do was bring water to the claim and wash the gold out,” said the story in the School Journal. “They hunted about for water but of course every miner wanted water and every creek belonged to someone else. The nearest water was at Chatto creek, twenty-one miles away. The labour of building a race would be enormous and they had practically no money, but nothing could daunt those seven Irishmen.” The men called on Gilbert Sinclair, an Englishman who ran a store at Blacks (now Ophir).
The water race was made by building up the outside with stones. Then the stone walls were lined with soil. The illustration is from the New Zealand School Journal.
16 Mining NZ » Winter, 2015
“They looked at the massive grey rocks that barred their way along the hillside. But they were as hard as rocks themselves by now. Nothing could daunt them.”
In those days it was customary for storekeepers to stake miners with food and other necessities, sometimes for months while they prepared their claims. He agreed to stake them, knowing the task ahead of the Irishmen was huge and that he wouldn’t be paid until they started to recover gold, if there was any. The Irishmen set to work building the 21 mile water race, identifying a place well up a hill for the head of the pipeline so they would have enough pressure at the sluicing point. They marked out the line of the water race with a spirit level, sighting from spur to spur along the side of the mountains until they arrived at Chatto creek. Then began the monumental task of constructing the race. “The water race was made by building up the outside with stones. Then the stone walls were lined with soil which soon became waterproof when wetted. “There were millions of stones on the Dunstan mountain sides, but they had to be carried, shaped and fitted in firmly. Some of the walls were built up twenty-five feet where they had to cross cliff faces.” Through the burning summer and freezing winter the hardy Irishmen worked. They lived in tents or sod huts they built themselves. When they couldn’t borrow a horse they carried their food on their backs, cooking their mutton and damper over open fires. Shovels and pick heads were blunted and worn out, and the soles of the mens’ boots were cut to pieces on the sharp schist gravel. There wasn’t an engineer or surveyor among them but the men understood every yard of the race had to slope just enough to let the water run and no more.
To keep the slope even they used a six foot triangle, fashioned from three boards with a plumb-bob that hung from the apex. It was a simple method of levelling that never failed them. By the end of the first year they had no money left. Everything from their tea, food and tobacco, to matches, tools and clothes came from Gilbert Sinclair who gave it to them without question. They toiled on and in the second summer completed their tenth mile, building up walls around steep faces, cutting through outrops of rock, and constructing small aquaducts of boards to carry the water across creeks. At the beginning of the third year they still had eight miles to go, with some of the hardest sections remaining. “They looked at the cliff in the gully against which they must build up a great wall to carry their race. They looked at the massive grey rocks that barred their way along the hillside. But they were as hard as rocks themselves by now. Nothing could daunt them. They lifted great slabs of schist, they fitted rock after rock to their wall in a frenzy of tireless toil. And they won.” At the end of the third year the water race was finished and the sluicing pipes were ready. But there was no guarantee the claim would give up any gold. They sluiced for ten months and still didn’t know how much gold they would get, or whether they would be able to repay Gilbert Sinclair. As they began the wash up they were delighted to find their hard labour had paid off, as the mine relinquished a decent amount of gold. One of the men rode the eight miles on horseback to Sinclair’s store with the first takings and put the bag on the counter in front of him. Sinclair weighed the gold, and said it would square the Irishmen’s account, but rather than
Mining Pioneers » keep the money himself, told the Irishman to take the money back and put it into developing the mine instead. “I’ve waited four years. I can wait a bit longer,” he said. The Irishmen worked the claim in the years that followed with great success. It was originally called Murphy and Party, but after the first wash the name of the mine was changed to Undaunted, in respect of the men’s tenacity, hard work and belief. They Irishmen later prospected in Southland and Thames and Undaunted Mine was taken over by The Undaunted Gold Mining Company, which was managed by Thomas Donnelly, son of Felix Donnelly, who in 1879 had been killed by a fall of earth while working his Blue Duck claim. Felix Donnelly’s widow took up farming in order to provide for her 11 children (including Thomas) and also ran two hotels, an amazing accomplishment for a woman of the era. In 1882 Gilbert Sinclair also passed away. He had fallen ill, and knew he was dying, so when potential beneficiaries started to circle, he brought a lawyer up from Dunedin to make his will, telling him to gather all his accounts. He was owed thousands of pounds by many miners in the district, some who hadn’t been as lucky as the Irishmen at Undaunted Mine. “Burn the lot,” he told the lawyer, insisting he did the job right there in front of him. “I’m not going to have my friends persecuted for money when I’m gone.” The lawyer did as he was asked. Sinclair’s death was mentioned in the Otago Witness on 27 May ,1882 stating: ‘Although his stock of merchandise never shone brilliant or appeared of much value, still at the time of his death he was possessed of much wealth.’ The generous benefactor was gone, but before his death his assistance had been a key to the success of many early gold mining operations in Central Otago, including the Irishmen of Undaunted. • We would like to express our thanks to Marie Hopkins (granddaughter of Thomas Donnelly, who later managed the Undaunted Mine Company) for passing on the journal, which provides us with such a fascinating glimpse into the past.
A miner all his life....
Thomas Donnelly - became the legal manager of the Undaunted Mine from the 1890s.
In the early 1890s, Thomas Donnelly became legal manager of the Undaunted Mine. This was part of an area of 114 acres mined by The Undaunted Mine Company, Matakanui which was registered in March 1898. Thomas Donnelly wrote in a note in in the New Zealand Mining Handbook of 1906, that, “Matakanui was better known amongst the early diggers as Tinkers, and is so called by many persons to the present day. It is computed that 100,000 ounces of gold has been won by private parties and companies on this rich field from a comparatively small area.” By this time there were four companies, including Undaunted carrying out operations at Matakanui. Between them they held around 300 acres of unworked ground, with an estimated further 1000 acres of auriferous ground in the locality, said Donnelly’s report. It is unclear how long mining operations continued at Undaunted. It was still definitely in production in 1914. Thomas Donnelly was later mentioned in the 1947 book In Search of Central Otago by G. Hugh Sumpter. Donnelly, then aged over 80, was described in the book as a “spectacular figure and grand old man” with a handsome white beard and a dangerous twinkle in his eye, who talked about the boom days at Tinkers (Matakanui) when there had been about fifteen mining companies in the district, two hotels and one “sly grog” shop. By the time a writer for the School Journal visited Tom Donnelly and his wife at Matakanui in 1948, and was given a tour of the old workings, the mine had not operated for some time. “Under our feet were the walls of the old races, built fifty, sixty and seventy years ago, still straight and sound, but dry and no longer used,” said the report. “Wherever you go in this country you find there’s a prospector who’s been there before you. They’ve burrowed into every creek bed and tried every valley. They were the first real explorers. Donnelly was a miner all his life, and a genuine Central Otago character, known for his toughness and tenacity. These traits appear to have been passed through the generations, with at least 10 of his direct descendants representing New Zealand at various sports over the years, including great grandsons Bevan Wilson and Tom Donnelly, both former All Blacks; granddaughters Marie Hopkins and Monica Flannery, and great-granddaughter Donna Flannery who all played hockey for New Zealand; Paula Flannery, who was in a World Cup winning New Zealand Women’s cricket team; and Commonwealth Games cycling gold medallist Nigel Donnelly.
Phone: (+ 64 272) 409 108 Email: info@terrafirma.kiwi.nz PO Box 67, Ngaruawahia 3742, New Zealand Terra Firma Mining
Limited (Terra Firma) is a small consultancy and contracting company that provides professional advice and high quality solutions to the extractive industry and high hazards sectors. Based in the Waikato but with a nationwide focus, Terra Firma can help all operators in the mining and quarrying industry meet industry good practice, comply with regulations and improve safety and productivity performance. Managing Director Lincoln Smith and Mining Executive Craig Smith have extensive operational experience in the underground mining sector and practical application of New Zealand mining and health and safety legislation. Their backgrounds are in a system- based and risk- based approach to safety management, which is the basis of the new mining regulations and Health and Safety Bill. Although a systems approach has not yet been rolled out for the quarrying industry, Lincoln sees it as inevitable and
recommends that all quarries aim to comply with the mining regulations now. “If its systems are well designed and implemented, an operation should not only improve safety performance but also improve its productivity and operational efficiency.” Lincoln is a strong advocate for workable and well- integrated health and safety management system documents. “The regulations are not meant to be onerous or to create masses of documents. If the system and procedures aren’t workable, they’re not doing their job”. An important requirement of any system is to be able to verify what is happening on the job. “If you can’t easily demonstrate that you are complying with your own procedures the chances are you’re not, and there is a gap in your system” says Lincoln. The new mining regulations are more prescriptive than previously, but it is the operator’s responsibility to
ensure worker safety. Craig says, ”there are a lot more rules in the new regulations and codes of practice but the operator must demonstrate that all hazards are properly managed through a risk assessment process”. Some operators may regard this as an unnecessary and time- wasting process. Craig’s response is that “while risk assessments definitely take time, if done well and if the workforce is involved, there are major benefits to the operation and to all the workers.”
assist mining and quarrying operators to review their existing plans and to prepare and monitor site health and safety operating plans. Terra Firma is also able to independently review operating plans to verify that plans are both current and meet good industry practice. Other services offered to assist operators in meeting their statutory requirements include conducting emergency preparedness reviews and training, compliance audits and incident investigations.
Terra Firma has assisted a number of companies undertake risk assessments of their procedures. Lincoln says, “it is important that a company owns the process but it can be helpful to have an independent facilitator or participant to help ensure that the process is efficient and that the objective is achieved.” Terra Firma has a strong belief that all accidents are preventable. Zero Harm is an achievable objective for all operators and not just a statement of commitment to safety. Terra Firma is able to
Winter, 2015 » Mining NZ 17
Minerals » Blue Pacific Minerals
New plant will stimulate growth Karen Phelps Blue Pacific Minerals expects to double production as a result of a $9m investment in a new zeolite processing plant, land and building alongside a substantial upgrade to quarrying equipment. Currently the company produces around 1000 container movements each year of zeolite and perlite. Blue Pacific Minerals managing director Dave Hill predicts this will grow to 2000 container loads over the next 24 months. The company has operated a zeolite plant in Tokoroa since 1998 when it purchased the business from Fernz also inheriting access rights to the Z3 zeolite quarry. It was the company’s first foray into the minerals industry. Blue Pacific Minerals is now New Zealand’s largest processor and distributor zeolite and perlite ore for domestic, commercial, agricultural and industrial applications throughout Australia, Asia and South Pacific regions. Hill says that the new Tokoroa site (called the ‘south site’) including an existing commercial building was purchased in 2009 as a response to future proofing forecast company growth. The company headquarters and packing plant was operated from the site while both zeolite and perlite processing continued at its existing Tokoroa site (dubbed the ‘north site’) nearby. Just two years later increased demand meant that additional production capacity was required. “The existing facility was producing 35,000 dry tonnes per year of zeolite and perlite when operating 24 hours a day six days a week. “We would campaign process zeolite for six to eight weeks, build up stocks then shut the plant down, decontaminate and start processing perlite for a number of weeks before repeating the whole process again. We were bursting at the seams at the north site,” explains Hill. Around 4000 square metres has been added to the building at the south site to form the new zeolite processing facility. The plant includes a TEMA drying system and Rotex finishing screens and was designed in conjunction with Matamata based company Rocktec. Local subcontractors were employed for electrical work and gas reticulation. The new zeolite plant started commercial production mid July and is capable of producing 20 dry tonnes of zeolite per hour.
Dave Hill: “We were bursting at the seams at the north site.” The north site is now a dedicated perlite processing facility with capacity to produce 10 dry tonnes per hour. Total annual production is expected to be 35,000 dry tonnes of perlite and over 100,000 dry tonnes of zeolite. Hill says there are additional pieces of plant, which will be added to the facilities over the coming months including an automated packaging system. Blue Pacific Minerals operates two quarries supplying raw materials to the plant, which will also require additional machinery to service the processing plants. The identification of potential growth opportunities in zeolite markets was a key driver for the investment.
“Our zeolite market growth will come from expanding into our current markets – absorbents, stock feed, turf and carrier markets for agriculture.” Hill expects most growth to come from the export market. Presently around 30% of the company’s zeolite market is offshore. “The unique properties of zeolite, which make it attractive to a number of different markets, include the mineral’s ability to absorb odour and liquid, its low bulk density, high cation exchange and high
internal surface area. Our zeolite market growth will come from expanding into our current markets – absorbents, stock feed, turf and carrier markets for agriculture. Before we simply didn’t have the production capacity to increase our business. Now that the upgrades are complete pursuing these new markets will be the next step.”
Around 4000 square metres has been added to the building at the Tokoroa site to form the new zeolite processing facility.
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Environment » MWC Environment Award
Recognition for Tunnelling Co project “Waihi Heritage
Karen Phelps Waihi Heritage Vision in partnership with Newmont Waihi Gold has won the 2015 Minerals West Coast Environment Award. The award winning entry was for the New Zealand Tunnelling Company project and detailed the long term efforts to tell the Tunnellers’ story, recognise the men who served and ensure they are appropriately honoured. Kit Wilson from Waihi Heritage Vision says that the decision was partly made to enter the awards as a number of the Tunnellers hailed from the West Coast: “It was a great opportunity to take the Tunnellers’ story to the West Coast.” He says that it was a real coup to win, especially considering the calibre of the other two entries the Tunneller’s project was pitted against: a project by OceanaGold Reefton to preserve Albon’s Coal Mine and remnants and Ross Alluvial Gold Miners which had organised a special day to celebrate 150 years of gold mining at the Totara Goldfield. Wilson thinks a deciding factor may have been the international interest the Tunneller’s project has generated. “It’s really grown and captured people’s imaginations,” says Wilson. The New Zealand Tunnelling Company was a group of men who enlisted in the First World War to use their skills as miners, engineers and Public Works employees to mine under enemy lines on the Western Front. The Company left in December 1915 and did not come home until just before ANZAC Day 1919, returning without fanfare to the jobs they had left behind.
Vision will soon begin construction of the memorial wall that is part of the Tunnellers’ Memorial.”
The NZ Tunnelling Company was a group of men who enlisted in World War 1 to use their skills as miners, engineers and Public Works employees to mine under enemy lines on the Western Front.
Waihi Heritage Vision in partnership with a range of funders and in-kind assistance from the mining industry and other partners has embarked on an ambitious 10-year project to remember the Tunnellers. The project is presently in year six and key achievements so far include the establishment of a Miners Reflective Area in Waihi, a military convoy of Tunnellers’ descendants into Newmont Waihi Gold’s Martha open pit mine and the
dedication of a Tunnelling Company memorial foundation stone at a ceremony attended by the Mayor of Arras, Cook Islands Queen’s Representative and the Hauraki District Council Mayor. On January 22 next year the project will reach another significant milestone with the dedication by the Governor General of a memorial to the New Zealand Engineers Tunnelling Company in Waihi.
The Minerals West Coast Environment award recognises excellence and achievement by an individual or organisation that demonstrates innovation and excellence in the minerals and mining industry. The awards, which are held each year in conjunction with the West Coast Minerals Forum, were this year in recognition of 150 years of mining on the West Coast. Organisers requested entries from projects with an environmental heritage theme. Wilson admits there was also an ulterior motive for entering the awards and attending the forum where he was a keynote speaker this year: “Waihi Heritage Vision will soon begin construction of the memorial wall that is part of the Tunnellers’ Memorial. “We are working hard to source a rock from each area that the Tunnellers enlisted from. Being able to talk to people on the West Coast and explain the project face to face has meant that we are now looking forward to rocks from that area featuring on the wall along with those from other mining areas.”
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20 Mining NZ » Winter, 2015
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Environment » MIMICO Environment Awards
The Old Marl quarry overlooking the Steeples - Holcim Westport is undertaking a major rehabilitation of its Tauranga Bay quarry site as it gets set to close operations.
Holcim - leaving on a positive note Karen Phelps Despite the decision to close its Tauranga Bay quarry at Cape Foulwind in the second half of 2016 Holcim Westport remains positive about the future of the site, says Cape Foulwind quarry manager Tony Warren. “We’re excited about the landscape we can achieve and what we can leave behind as a legacy for the community,” he says. The company has just taken out gold in the 2015 MIMICO Environmental Excellence Awards for its work so far on undertaking a major rehabilitation of the quarry, transforming areas into recreation amenities for public use along with restoring nearby land to mature indigenous forest. Areas that are yet to be restored include farmland, the quarry operations area and overburden dumps. As the excavation process leaves a substantial pit after the completion of mining this will be filled naturally to form a lake. Quarrying began at the site in 1958. Situated on an area of 150ha the quarry now has an annual production of one million tonnes of limestone and marl. Recognising that quarrying operations can have a major impact on the surrounding environment and on nearby communities it was in the 1980s the company started investigating options for the rehabilitation of worked out areas of the quarry. In 1990 a relationship was formed with the University of Canterbury School of Forestry, which has seen a native tree nursery established at the site and thousands of trees already planted. Another project already completed is the transformation of the Old Marl stone quarry into a public picnic and recreation area including a walking track. Warren says that Holcim’s concept for the rehabilitation of the quarry is based on four key guiding policies: rehabilitation should mimic natural forest generation; direct human contact is to be minimised; rehabilitation has been concurrent with quarrying operations and cost must be wellmanaged. The strategy is part of Holcim’s Quarry Rehabilitation Directive, a document crafted for worldwide application, which sets a very high standard for such work and would appear to exceed resource consent requirements, as they stand, at the Cape Foulwind site, he says.
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While the original plan was to restore the area by 2040 plans are currently being revised due to Holcim’s decision to close the plant. Warren says that the decision was made for economic reasons, as the factory was at the end of its economic life. Holcim will now source future cement requirements from global sources and distribute to customers through new Terminal facilities at Auckland and Timaru. He says that there have been a range of proposals brought forward to Holcim in regards to the use of the quarry land once the plant has closed including an international race standard cycling track, a viewing and nature walk track, a lake for
“We’re excited about the landscape we can achieve and what we can leave behind as a legacy for the community.” recreational and sporting use, and a geological viewing site. “In the final 18 months of the plant’s operation, these ideas are being more thoroughly considered, while taking into account the community’s interests.” He says that winning was recognition that
Holcim has made a positive impact, particularly heartening for Holcim Westport and its staff given news of the closure: “It’s about positive feedback from the industry that we’re doing it right.” Runners up in the awards were Winstone Aggregates, Belmont Quarry, Lower Hutt (silver) and Fulton Hogan, Gore Crushing, Gore (bronze).
The Old Marl stone quarry has been transformed into a public picnic and recreation area including a walking track.
call 0800 4 ENZED or visit www.enzed.co.nz Winter, 2015 » Mining NZ 21
Quarrying » NZ Quarrying Conference
Industry focus on health and safety Karen Phelps Forging the Path to the Future was the working theme of the 47th combined Institute of Quarrying NZ Inc and Aggregate and Quarry Association conference held in Hamilton from 15-17 July. And it was health and safety that was on the minds of the 300 delegates who attended, says chief executive of the Aggregate and Quarry Association, Roger Parton. Ongoing changes to regulations and codes of practice for the industry from the commencement of WorksafeNZ as a result of the Pike River disaster formed major topics of discussion. Parton says that one of the biggest areas of concern was new training requirements for Quarry Manager A and B Grade Certification. “All quarry managers will now have to sit additional units to achieve certification. “People are trying to understand exactly what is required and how Worksafe NZ will implement this,” he says. With training needing to be completed by the beginning of 2016 Parton says that concerns were also expressed from participants as to how everybody in the industry would be accommodated by this date in order to achieve certification under the new criteria. “With around 1500 people currently holding B Grade Certification how will this volume of people be trained before this due date? “There are administrative issues that need to be worked through and industry has been working with MinEX, MITO and Worksafe NZ to manage the process,” says Parton. The other major topic of discussion at the conference was around new health and safety guidelines.
Industry leaders: from left, new Aggregate and Quarry Association chair, Brian Roche, former chair, Andrea Cave, chi ef executive Roger Parton and MIMICO judge Dr Morgan Williams.
Industry is working with Worksafe NZ to develop guidelines for the operation of quarries and alluvial mines which were not included in the Health and Safety in Employment (Mining Operations and Quarrying Operations) Regulations 2013.
Parton says these are almost complete and there were questions at the conference as to when the regulations would be released and what this would mean for the industry. Parton confirmed the regulations would be released later this year although no specific date has yet been set.
The first address at the conference by Ian Harvey, Golder Associates principal mining engineer, stressed the conference’s focus on safety. Harvey spoke about managing hazards to operate safely and profitably.
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Quarrying » NZ Quarrying Conference
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Because New Zealand legislation and the Health and Safety in Employment (Mining Operations and Quarrying Operations) Regulations 2013 now specify a risk-based approach to health and safety management, Harvey stressed that almost all quarrying operations will require the implementation of a Ground Instability Management Plan as part of the site health and safety management system in order to document and manage risks. Tony Forster, chief inspector extractives WorkSafe New Zealand, also addressed the conference confirming his commitment to engaging with industry to ensure an open dialogue between operator and regulator. “We have to make the deaths of the Pike River men mean something.
A large trade show with 69 trade stands this year helped delegates to get up to date with the latest offerings to the industry.
“We have to stand on their shoulders and reach for a higher standard of safety than they enjoyed. “I am really passionate about what I’m doing and my appetite for this is as voracious as it’s ever been.” MinEx CEO Les McCracken spoke about the focus MinEx’s will take in 2015 shifting from those sectors covered by the 2013 regulations to the quarry and alluvial gold sectors who will
face similar issues to other sectors with the introduction of a new risk based Health and Safety act. The conference was also an opportunity for delegates, speakers and exhibitors to celebrate the past year and learn about trends for the future. The conference included presentations on technical issues ranging from the geological structure of excavation to the use of remotely piloted aerial systems in surveys.
Delegates also took a field trip to the Hamilton Expressway where they learned how the quarry industry had been a valuable contributor to the project. A large trade show with 69 trade stands this year helped delegates to get up to date with the latest offerings to the industry. The next Institute of Quarrying NZ Inc and Aggregate and Quarry Association conference is set to be held in Blenheim at the Marlborough Conference Centre in July 2016.
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Quarrying » Industry News
Southland Serpentine seeks consent Peter Owens One of the signs of a revival in livestock farming is the application by Southland Serpentine to the Southland District Council for a consent to mine up to 250,000 cubic metres of serpentine rock from its quarry. This is situated at Mossburn in Northern Southland, a region where there is considerable quarrying of various minerals. This is not a new quarry at Mossburn and in fact various interests have been mining serpentine since the early 1940s. The rock is high in magnesium content and makes a very effective type of superphosphate. There was strong demand for that product by farmers and from other sources, as well as the Mossburn miners during World War II saw the Japanese invade other Pacific sources of superphosphate. The quarry is owned by the Hamilton family, which has licensed the current operator Southland Serpentine Limited. Southland Serpentine was formed in 2006 for the express purpose of re-opening the works, which had been closed down after it lost the use of the railway line between Mossburn and the railhead at Lumsden. At present, Southland Serpentine’s quarry at Mossburn is the only one processing the mineral in the South Island. At present the product from the Mossburn quarry is mined with a 20 tonne digger for storage until it is trucked to McGregors’ Concrete in nearby Te Anau. There, the serpentine is crushed and screened. The final crushing at the Te Anau plant includes closed circuit crushing and screening through a BARMAC crusher until minus 3mm serpentine fines are produced.
24 Mining NZ » Winter, 2015
Southland Serpentine’s quarry at Mossburn is the only one processing the mineral in the South Island. There are still significant reserves of serpentine in the Mossburn quarry. The application to the Southland District Council has been filed by Bonisch Environmental of the Crescent Invercargill. Serpentine occurs naturally and the mineral at
Mossburn contains high levels of magnesium and cobalt. The mined and processed product is sold in bulk by the company or blended to the purchasers’ specifications for use as a natural agricultural fertiliser. Shares in Southland Serpentine Limited are
owned by Duncan and Lachlan McGregor, who operate McGregors’ Concrete Limited at Te Anau and Robert and Lyn Pearson of Mossburn. Bob Pearson, who has considerable experience as an industrial chemist, is plant manager and Lyn is office manager and administrator.
Industry » Speight Drilling
Speight Drilling has bases in Reefton and Christchurch and works throughout the South Island.
‘Amazing drill’ breaks new ground Jo Bailey A new sonic wire-line drilling method, believed to be the only one of its type in New Zealand, has increased the capability of South Island drilling specialists, Speight Drilling. Kevin Speight, who owns the firm with his wife Deanna, says they took possession of the rig last year, and spent around six months fine tuning it before releasing its services to the market. “It’s a pretty amazing drill and we’re working on some great projects with it now. “The drill has a really good recovery rate, with excellent presentation of ground formation so is particularly well suited to alluvial gravel drilling for gold sampling, or geotechnical projects.” In addition to retrieving accurate sub-surface data, the rig’s wire-line system produces costeffective holes, saving clients time and money, he says. “With conventional equipment the entire drill string has to be pulled out every one-and-a-half metres, but with the wire-line system an inner tube of core can be removed from the bottom of the hole
without removing the drill rod string assembly. Once you get down in depth it becomes a twominute exercise, rather than a 10 to 20 minute one.” Speight Drilling was set up by the couple in Reefton, and for the last two years they have also run a yard at Harewood, in Christchurch, where the firm has completed a lot of geotechnical drilling since the earthquakes. “We work all over the South Island and are also finalising a couple of jobs in Auckland at the moment,” he says. “You’ve got to be prepared to travel and we enjoy working in the different geology in different regions. There is always something to learn.” Diversifying outside the mining sector has been critical to maintaining a “comfortable” workflow for the company. “We’re well kitted out, with gear to cover all sorts of exploration and geotechnical sampling and drilling. “A lot of the features on our equipment have been custom designed for our operation, so it can do a bit more than off-the-shelf drilling equipment.” The company’s large fleet of rigs have the capacity to drill up to 1200 metres NQ, with
heli-portable skid or crawler mounted drilling rigs enabling it to work in remote areas when required. It also has a wide range of ancillary equipment including the Tibban Mud Puppy mud recycler system which is used to eliminate spills and sludge on its work sites; and a high quality safety communication system. “We take safety seriously and believe the expense is well worth it. We are CPNZ/Impac Prequal safety approved contractors, take part in the ACC discount safety scheme, and are also active members of Site Safe NZ.” The Speight Drilling team regularly attends training seminars, and all drillers are working to complete their Level 3 National Certificate in Drilling.
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working in the different geology in different regions. There is always something to learn.”
Speight says that the firm is continually innovating and looking at new initiatives, with a potential new market drilling and installing horizontal and vertical links for ground source heat pumps. “The technology utllises the natural ground temperature to maintain a more ambient heat inside a home, saving a lot of energy. “It has been available in Europe for years but is starting to take off here, particularly in Canterbury.” The company’s diversity means there is “never a boring day”, he says. “We have the opportunity to work in some of the most beautiful places in New Zealand. “The geology of the ground has always fascinated me and it’s pretty special to see a piece of history come up from the ground.”
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Winter, 2015 » Mining NZ 25
Industry News »
Awards recognition for ARANZ Geo ARANZ Geo Limited, a world leader in the interpretation and visualisation of geological data for the mining, environmental, renewable energy and other geologically dependent industries, has been named as a finalist in the 2015 Champion Canterbury Business Awards in the Global Operator category. ARANZ Geo chief executive, Shaun Maloney, said the recognition was “ great acknowledgement for our truly world-class team around the globe”. Maloney said it had been “a significant year” for the company. “Not only have we continued to grow quickly and open up and build new markets such as Russia, Brasil, Turkey and Mexico, we also bought back our distributor network in Chile, Peru, Denmark, and Canada. “On top of that we’ve developed new products that are set for launch.” ARANZ Geo has built a global reputation in the mining industry in particular as the developers of Leapfrog® 3D geological modelling solutions for the mining, exploration, groundwater contamination, and geothermal energy industries. The very first geological modelling tool of its kind, Leapfrog now sets the standard and is an indispensable tool to reduce risk associated with geological modelling and is relied on by the top ten mining and exploration firms to enable better decision making. Subsidiary company QG serves the mining consultancy market. “The company has achieved extraordinary growth over the past few years in large part to increasing demand for our Leapfrog software”, says Maloney. “Our fast growing team has responded fantastically to this demand and continues to
Full steam ahead: ARANZ Geo chief executive, Shaun Maloney, above left, and, at right, digital marketing manager, Nathan Moher, and marketing co-ordinator, Hannah Pearce.
really push the boundaries to deliver outstanding products that our clients can trust. “Each day millions of dollars of investment decisions based on geology are made using our software.” ARANZ Geo’s global footprint includes a Christchurch-based HQ and R&D centre and offices in Asia/Pacific, Africa, South America, North America and Europe. Maloney says the company is also gearing up to open up more new markets this year. 48 businesses were chosen as finalists for the
Awards at a special function last night. A record number of 196 entries were received for this year’s Awards, a jump of 34percent from 2014 and up 21% on the previous record year in 2012. “The record number of entries this year was very pleasing, but the consistently high quality of the entries is an even better indicator of how our business community is performing at present” said Peter Townsend, Chief Executive of the Canterbury Employers’ Chamber of Commerce, and Chairman of Champion Canterbury Ltd.
“The company has achieved extraordinary growth over the past few years in large part to increasing demand for our Leapfrog software.”
Z7 - maximising performance MIMICO, the New Zealand distributor of leading brand equipment for the quarrying, mining, contracting, construction, recycling and forestry industries, was recently appointed as the New Zealand distributor of Kawasaki’s new range of Z7 wheel loaders. The new Kawasaki Z7 made its debut at the 2015 NZ National Agricultural Fieldays. MIMICO says Kawasaki pioneered the Z-Link design to provide unmatched utility, high breakout force and efficiency in its loaders. “The Z7 generation implements brandnew patented technology, industry exclusive innovation, and input from owners and operators all over the world. “The Z7 series is engineered from the ground up and is truly EPIC. Efficient: Quick Cycle functions and PowerTrain Efficiencies work together through the IntelliTech Operating System to improve
26 Mining NZ » Winter, 2015
the machine operating efficiency and reduce operating costs. Powerful: Custom Operating Power Modes, made available through the IntelliTech Operating System, maximize a High Engine Power Rating to provide power on demand. Intelligent: The Kawasaki IntelliTech Operating System uses logic and intelligence to adjust the operating characteristics of the loader. This intuitive system captures every aspect of working conditions and operating demands to adjust the powertrain and hydraulics for best application requirements. All of the IntelliTech features are designed to maximize performance. Comfortable: The new Z7 operator compartment features a low-profile dash, fulllength glass doors, panoramic front window, standard rear-view camera and well-organised storage areas.
Big lift: a new kiln drier is lifted into Blue Pacific Minerals’ new zeolite processing plant at Tokoroa. BPM expects to double production as a result of its $9m investment in the new plant, land and building alongside a substantial upgrade to quarrying equipment. Story page 18.
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