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Ferrexpo confirms trolley assist scoping studies at Poltava

Ferrexpo, as part of its efforts towards integrating into a ‘Green Steel’ supply chain, is embarking on scoping studies looking at installing trolley assist technology at its Poltava mine in Ukraine.

The iron ore miner produced 11.2 Mt of iron ore pellets in 2020 from its Yeristovo and Poltava mines, up from 10.5 Mt in 2019. With iron ore prices on the rise and costs down during the 12-month period, the company recorded underlying EBITDA of $859 million, 46% higher than 2019.

During 2020, the company achieved material reductions in its carbon footprint per tonne for both Scope 1 (8%) and Scope 2 (21%) emissions, with a similar trajectory expected in 2021, Lucio Genovese, Non-executive Chair of Ferrexpo, said.

In the future growth investment program of its 2020 annual results statement, the company unveiled several projects to boost production, operating efficiency and sustainability.

The first one up was its mining fleet automation project.

In December 2020, the company commenced Phase 1 deployment of autonomous trucks at its Yeristovo iron ore mine, also in Ukraine. This project saw Caterpillar 793 haul trucks retrofitted with autonomous haulage capabilities through an agreement with ASI Mining.

The company said: “Phase 1 deployment of autonomous trucks commenced in December 2020, with an expectation to deploy additional autonomous Cat 793 haul trucks to production areas throughout 2021 (Phase 1), delivering gains in both safety and productivity.”

The autonomous truck deployment represents a significant milestone, with Yeristovo becoming the first mine in Europe to successfully invest in this modern technology, Ferrexpo said.

Deployment of autonomous haul trucks follows Ferrexpo’s investment in semi-autonomous/autonomous drill rigs (with Epiroc) and drone surveys since 2017 and 2018, respectively, which have brought significant safety improvements, it said.

“We expect to see similar benefits throughout our mining department as further automation investments are realised,” the company added.

On the trolley assist project at Poltava, Ferrexpo said scoping studies were underway to install a pantograph network of overhead cables in the group’s mines, which would enable haul trucks to ascend the open pit using electricity rather than diesel. It noted benefits were expected in its C1 cost base and Scope 1 carbon footprint.

In December, Ferrexpo Acting CEO, Jim North, told IM that the company planned to move to electric drive haul trucks in the next few years as a precursor to applying trolley assist at the operation.

Power infrastructure is already available in the pits energising most of its electric-hydraulic shovels and backhoes, and the intention is for these new electric drive trucks to go on trolley line infrastructure to eradicate some of the operation’s diesel use.

“Initially we would still need to rely on diesel engines at the end of ramps and the bottom of pits, but our intention is to utilise some alternative powerpack on these trucks as the technology becomes available,” North said at the time.

He expected that alternative powerpack to be battery-based, but he and the company were keeping their options open during conversations with OEMs about its fleet replacement plans.

With around 15% of the company’s carbon footprint tied to diesel use, this could have a big impact on Ferrexpo’s ‘green’ credentials, yet North said the transition to trolley assist made sense even without this sustainability benefit.

“The advantages in terms of mining productivity are huge,” North said. “You go from 15 km/h on ramp to just under 30 km/h on ramp.”

Another carbon-reduction project the company is pursuing is the development of a 5 MW pilot solar plant positioned at its concentrator. In its 2020 results statement, the company said procurement for this project was expected in the second half of the year.

There was $4 million of capital outstanding associated with this project in 2021, with the pilot looking to investigate the potential for industrial-scale generation of solar power at the company’s operations, commencing with the 5 MW pilot plant.

Ferrexpo said: “Electricity consumption accounted for 55% of the group’s Scope 1 and 2 carbon emissions in 2020, with solar power offering significant potential for cutting the group’s carbon footprint.

“Should this trial be successful, we will look to significantly expand this particular project.”

North sets Ferrexpo on a course for ‘carbon neutrality’

Ferrexpo is used to setting trends. It was the first company to launch a new open-pit iron ore mine in the CIS since Ukraine gained its independence in 1991 and has recently become the first miner in Ukraine to adopt autonomous open-pit drilling and haulage technology.

It plans to keep up this innovative streak if a conversation with Acting CEO Jim North is anything to go by.

North, former Chief Operating Officer of London Mining and Ferrexpo, has seen the technology shift in mining first-hand. A holder of a variety of senior operational management roles in multiple commodities with Rio Tinto and BHP, he witnessed the take-off of autonomous haulage systems (AHS) in the Pilbara, as well as the productivity and operating cost benefits that came with removing operators from blasthole drills.

He says the rationale for adopting autonomous technology at Ferrexpo’s Yeristovo mine is slightly different to the traditional Pilbara investment case.

“This move was not based on reduction in salaries; it was all based on utilisation of capital,” North told IM. While miners receive comparatively good salaries in Ukraine, they cannot compete with the wages of those Pilbara haul truck drivers.

Ferrexpo Acting CEO, Jim North

North provided a bit of background here: “The focus for the last six years since I came into the company was about driving mining efficiencies and getting benchmark performance out of our mining fleet. This is not rocket science; it is all about carrying out good planning and executing to that plan.”

The company used the same philosophy in its process plant – a philosophy that is likely to see it produce close to 12 Mt of high grade (65% Fe) iron ore pellets and concentrate next year.

Using his industry knowledge, North pitted Ferrexpo’s fleet performance against others on the global stage.

“Mining is a highly capital-intensive business and that equipment you buy has got be moving – either loaded or empty – throughout the day,” North said. “24 hours-a-day operation is impossible as you must put fuel in vehicles and you need to change operators, so, in the beginning, we focused on increasing the utilised hours. After a couple of years, I noticed we were getting very close to the benchmark performance globally set by the majors.

“If you are looking at pushing your utilisation further, it inevitably leads you to automation.”

Ferrexpo was up for pushing it further and, four years ago, started the process of going autonomous, with its Yeristovo iron ore mine, opened in 2011, the first candidate for an operational shakeup.

“Yeristovo is a far simpler configuration from a mining point of view,” North explained. “It is basically just a large box cut. Poltava, on the other hand (its other iron ore producing mine currently), has been around for 50 years; it is a very deep and complex operation.

“We thought the place to dip our toe into the water and get good at autonomy was Yeristovo.”

This started off in 2017 with deployment of teleremote operation on its Epiroc Pit Viper 275 blasthole drill rigs. The company has gradually increased the level of autonomy, progressing to remotely operating these rigs from a central control room. In 2021-2022, these rigs will move to fully-autonomous mode, North says.

Ferrexpo has also been leveraging remotely-operated technology for mine site surveying, employing drones to speed up and improve the accuracy of the process. The miner has invested in three of these drones to carry out not only site surveys, but stockpile mapping and – perhaps next year – engineering inspections.

“The productivity benefits from these drones are huge,” North said. “In just two days of drone operation, you can carry out the same amount of work it would take three or four surveyors to do in one or two weeks!”

OEM-agnostic solution

It is the haul truck segment of the mine automation project at Yeristovo that has caught the most industry attention, with Ferrexpo one of the first to choose an OEM-agnostic solution from a company outside of the big four open-pit mining haul truck manufacturers.

The company settled on a solution from ASI Mining, owned 34% by Epiroc, after the completion of a trial of the Mobius® Haulage A.I. system on a Cat 793D last year.

The first phase of the commercial project is already kicking off, with the first of six Cat 793s converted to autonomous mode now up and running at Yeristovo. On completion of this first phase of six trucks, consideration will be given to timing of further deployment for the remainder of the Yeristovo truck fleet.

This trial and rollout may appear fairly routine, but behind the scenes was an 18-month process to settle on ASI’s solution.

“For us, as a business, we have about 86 trucks deployed on site,” North said. “We simply couldn’t take the same route BHP or Rio took three or four years ago in acquiring an entirely new autonomous fleet. At that point, Cat and Komatsu were the only major OEMs offering these solutions and they were offering limited numbers of trucks models with no fleet integration possibilities.

“If you had a mixed fleet – which we do – then you were looking at a multi-hundred-million-dollar decision to change out your mining fleet. That is prohibitive for a business like ours.”

Ferrexpo personnel visited ASI Mining’s facility in Utah, USA, several times, hearing all about the parent company’s work with NASA on robotics. “We knew they had the technical capability to work in tough environments,” North remarked.

“We also saw work they had been doing with Ford and Toyota for a number of years on their unmanned vehicles, and we witnessed the object detect and collision avoidance solutions in action on a test track.”

Convinced by these demonstrations and with an eye to the future of its operations, Ferrexpo committed to an OEM-agnostic autonomous future.

“If we want to get to a fully autonomous fleet at some stage in the future, we will need to pick a provider that could turn any unit into an autonomous vehicle,” North said. It found that in ASI Mining’s Mobius platform.

Such due diligence is representative not only of the team’s thorough approach to this project, it also reflects the realities of deploying such a solution in Ukraine.

“It is all about building capability,” North said. “This is new technology in Ukraine – it’s not like you can go down the road and find somebody that has worked on this type of technology before. As a result, it’s all about training and building up the capacity in our workforce.”

After this expertise has been established, the automation rollout will inevitably accelerate.

“Once we have Yeristovo fully autonomous, we intend to move the autonomy program to Belanovo, which we started excavating a couple of years ago,” North said. “The last pit we would automate would be Poltava, purely due to complexity.”

Belanovo, which has a JORC Mineral Resource of 1,700 Mt, is currently mining overburden with 30-40 t ADTs shifting this material. While ASI Mining said it would be able to automate such machines, North decided the automation program will only begin when large fleet is deployed.

“When we deploy large fleet at Belanovo and start to move significant volumes, we intend for it to become a fully-autonomous operation,” he said.

Poltava, which is a single pit covering a 7 km long by 2 km wide area (pictured below), has a five-decade-long history and a more diverse mining fleet than Yeristovo. In this respect, it was always going to be harder to automate from a loading and haulage point of view.

“If you think about the fleet numbers deployed when Belanovo is running, we will probably have 50% of our fleet running autonomously,” North said. “The level of capability to run that level of technology would be high, so it makes sense to take on the more complex operation at Poltava at that point in time.”

Consolidation and decarbonisation

This autonomy transition has also given North and his team the chance to re-evaluate its fleet needs for now and in the future.

This is not as simple as it may sound to those thinking of a typical Pilbara AHS fleet deployment, with the Yeristovo and Poltava mines containing different ore types that require blending at the processing plant in order to sustain a cost-effective operation able to produce circa-12 Mt/y of high-grade (65%-plus Fe) iron ore pellets and concentrate.

“That limits our ability in terms of fleet size for ore mining because we want to match the capacity of the fleet to the different ore streams we feed into the plant,” North said.

This has seen the company standardise on circa-220 t trucks for ore movement and 300-320 t trucks for waste haulage.

On the latter, North explained: “That is about shovel utilisation, not necessarily about trucks. If you go much larger than that 320-t truck, you are talking about the need to use large rope shovels and we don’t have enough consistent stripping requirements for that. We think the 800 t-class electric hydraulic excavator is a suitable match for the circa-320 t truck.”

This standardisation process at Poltava has seen BELAZ 40 t trucks previously working in the pit re-assigned for auxiliary work, with the smallest in-pit Cat 777 trucks acting as fuel, water and lubrication service vehicles at Poltava.

“The Cat 785s are the smallest operating primary fleet we have at Poltava,” North said. “We also have the Hitachi EH3500s and Cat 789s and Cat 793s, tending to keep the bigger fleet towards Yeristovo and the smaller fleet at Poltava.”

In carrying out this evaluation, the company has also plotted its next electrification steps.

“Given we have got to the point where we know we want 220 t for ore and 300-320 t nominally for waste at Yeristovo, we have a very clear understanding of where we are going in our efforts to support our climate action,” North said.

Electrification of the company’s entire operation – both the power generation and pelletising segment, and the mobile fleet – forms a significant part of its carbon reduction plans.

A 5 MW solar farm is being built to trial the efficacy of photovoltaic generation in the region, while, in the pelletiser, the company is blending sunflower husks with natural gas to power the process. Fine tuning over the past few years has seen the company settle on a 30:70 sunflower husk:natural gas energy ratio, allowing the company to make the most of a waste product in plentiful supply in Ukraine.

On top of this, the company is recuperating heat from the pelletisation process where possible and reusing it for other processes.

With a significant amount of ‘blue’ (nuclear) or ‘green’ (renewable) power available through the grid and plans to incorporate renewables on site, Ferrexpo looks to have the input part of the decarbonisation equation covered.

In the pellet lines, North says green hydrogen is believed to be the partial or full displacement solution for gas firing, with the company keenly watching developments such as the HYBRIT project in Sweden.

On the diesel side of things, Ferrexpo is also charting its decarbonisation course. This will start with a move to electric drive haul trucks in the next few years.

Power infrastructure is already available in the pits energising most of its electric-hydraulic shovels and backhoes, and the intention is for these new electric drive trucks to go on trolley line infrastructure to eradicate some of the operation’s diesel use.

“Initially we would still need to rely on diesel engines at the end of ramps and the bottom of pits, but our intention is to utilise some alternative powerpack on these trucks as the technology becomes available,” North said.

He expects that alternative powerpack to be battery-based, but he and the company are keeping their options open during conversations with OEMs about the fleet replacement plans.

“We know we are going to have to buy a fleet in the next couple of years, but the problem is when you make that sort of purchase, you are committing to using those machines for the next 20 years,” North said. “During all our conversations with OEMs we are recognising that we will need to buy a fleet before they have probably finalised their ‘decarbonised’ solutions, so all the contracts are based on the OEM providing that fully carbon-free solution when it becomes available.”

With around 15% of the company’s carbon footprint tied to diesel use, this could have a big impact on Ferrexpo’s ‘green’ credentials, yet the transition to trolley assist makes sense even without this sustainability benefit.

“The advantages in terms of mining productivity are huge,” North said. “You go from 15 km/h on ramp to just under 30 km/h on ramp.”

This is not all North offered up on the company’s carbon reduction plans.

At both of Ferrexpo’s operations, the company moves a lot of ore internally with shuttle trains, some of which are powered by diesel engines. A more environmentally friendly alternative is being sought for these locomotives.

“We are working with rail consultants that are delivering solutions for others to ‘fast follow’ that sector,” North said referencing the project already underway with Vale at its operations in Brazil. “We are investigating at the moment how we could design and deploy the solution at our operations for a lithium-ion battery loco.”

Not all the company’s decarbonisation and energy-efficiency initiatives started as recently as the last few years.

When examining a plan to reach 12 Mt/y of iron ore pellet production, North and his team looked at the whole ‘mine to mill’ approach.

“The cheapest place to optimise your comminution of rock is within the mine itself,” North said. “If you can optimise your blasting and get better fragmentation in the pit, you are saving energy, wear on materials, etc and you are doing some of the job of the concentrator and comminution process in the mine.”

A transition to a full emulsion blasting product came out of this study, and a move from NONEL detonators to electronic detonators could follow in the forthcoming years.

“That also led us into thinking about the future crusher – where we want to put it, what materials to feed into the expanded plant in the future, and what blending ratio we want to have from the pits,” North said. “The problem with pit development in a business that is moving 150-200 Mt of material a year is the crusher location needs to change as the mining horizons change.”

It ended up becoming a tradeoff between placing a new crusher in the pit on an assigned bench or putting it on top of the bench and hauling ore to that location.

The favoured location looks like being within the pit, according to North.

“It will be a substantial distance away from where our existing facility at Poltava is and we will convey the material into the plant,” he said. “We did the tradeoff study between hauling with trains/trucks, or conveying and, particularly for Belanovo, we need to take that ore to the crusher from the train network we already have in place.”

These internal ‘green’ initiatives are representative of the products Ferrexpo is supplying the steel industry.

Having shifted away from lower grade pellets to a higher-grade product in the past five years and started to introduce direct reduced iron pellet products to the market with trial shipments, Ferrexpo is looking to be a major player in the ‘green steel’ value chain.

North says as much.

“We are getting very close to understanding our path forward and our journey to carbon neutrality.”

Epiroc surprises with positive Q3 financials and automation, electrification advances

It is fair to say Epiroc’s September quarter results surprised on the upside.

Amid the COVID-19 pandemic, orders received held up, dropping just 2% to SEK9.37 billion ($1.07 billion) compared with orders in the September quarter of 2019. In fact, on an “organic basis”, orders received were up 10% year-on-year.

At the same time, operating profit remained stable, only decreasing by a little over 5% year-on-year to SEK1.82 billion.

The Epiroc management team took the view that this performance was no exception, issuing a plan to propose a second dividend of SEK1.20/share at the Extraordinary General Meeting on November 27.

Investors viewed these numbers positively: its Stockholm-listed shares closed 8% higher.

While the revenue numbers were dominated by the company’s aftermarket business, which generated 69% of the SEK8.7 billion, it was on the equipment side where some very interesting developments were observed.

The company recorded a 25% year-on-year organic increase in equipment orders in the period, reinforced by a few large orders such as those from Norilsk Nickel. The majority of orders were small- to medium-sized contracts of, say, one or two pieces of equipment, according to Helena Hedblom, President and CEO.

“More customers have taken the decision to invest,” she told IM, adding that this development followed two quarters where mining companies were hesitant to commit.

Within these new orders were several automation agreements, the company said, alongside new battery-electric equipment and digital bookings.

Epiroc has continually committed to advancing technology related to digitalisation, automation and electrification, and it appears the fallout from COVID-19 and the sector’s sustainability drive are strengthening demand for these products.

“I see clearly the interest and demand for automation and tele-remote solutions is increasing in light of the pandemic,” Hedblom said of how COVID-19 had impacted the company’s product focus.

“The key to success for us is we have built up these regional application centres that have given us the capability to deploy automation and teleremote systems without international travel.”

Still on the topic of automation, Epiroc revealed even more today.

The first snippet of news, which Hedblom snuck in during the webcast, was that the company had secured an order for an autonomous fleet of surface drill rigs from an unnamed customer in southern Africa.

The second, which she teed up in the official results release, built on in the webcast, and expanded on for IM, was the successful deployment of “unique solutions” for OEM-mixed fleet automation.

In surface mining, the company, in tandem with ASI Mining, has retrofitted automation on Caterpillar haul trucks running at Ferrexpo’s Yeristovo iron ore mine, in Ukraine. The market had already been told about this.

Solutions for OEM-mixed fleet automation underground was very much representative of ‘news’.

“For underground, we have deployed very advance traffic management solutions for mixed fleet automation where we have automated our loaders and then machines from another OEM,” she said. “That is a breakthrough.”

While Hedblom was not able to say too much more about the project, she did acknowledge the solution was a few years in the making and had been advanced with an existing customer.

“The traffic management solution is based on the partnership we have with Combitech,” she explained. “It is a traffic management system being used in airports and subways in the big cities of the world, so is a highly advanced solution.”

Such a partnership dates back to 2017 when Atlas Copco (the Epiroc predecessor) signed an agreement with the Saab subsidiary to advance its digitalisation and automation initiatives.

There was also some news on the battery-electric front, too.

Back in November 2018 at the company’s Power Change Days event in Örebro, Sweden, Erik Svedlund, Global Marketing Manager – Electrification, mentioned the potential for retrofitting battery-electric technology on Epiroc diesel equipment. He said there was also the potential for such a solution being employed on other OEMs’ machines.

IM asked Hedblom about this.

“We have developed the first retrofit kit for a ST1030,” she replied, explaining that the company was “coming close” to releasing such a solution to the market.

While the company has electrified its Scooptram ST7 and its Scooptram ST14, the 10 t payload LHD has been, to this point, only available in diesel-powered form.

She added: “We have also partnered up with a couple of other OEMs that will use our battery system.”

This could be similar to how Railcare, a Swedish manufacturer of machines that keep railways safe and clean, will use Epiroc’s modular and scalable battery-electric technology platform (including batteries supplied by Northvolt) to power its Multi-Purpose Vehicle for rail maintenance applications.

“It goes very much hand-in-hand with the OEM-agnostic approach that we strongly believe in,” Hedblom said.

Those words are backed up by some substantial actions.

Barrick trialling autonomous and battery-electric tech at North America mines

Barrick Gold’s automation and electrification efforts look to be gaining pace, with the leading gold miner revealing it has been testing out new technology at some of its operations in the US and Canada.

In its recently released annual report, Barrick said the first stage of a project designed to retrofit an autonomous system at its Carlin gold mine, in Nevada, had been completed successfully.

Matthew Majors, Open Pit Operations Superintendent at Carlin Surface, said in a presentation last month that multiple underground evaluation deployments, surface drilling OEM evaluation, and non-OEM surface production haulage options had been evaluated across the Barrick and Newmont jointly-owned Nevada Gold Mines business.

While the company didn’t provide any more details on the project, Barrick has previously leveraged ASI Mining’s OEM-agnostic autonomous solution at its jointly-owned South Arturo gold operation, also in Nevada. This saw the completion of a proof of concept (POC) using five haulage units “that have delivered over 5.5 Mt faster than any other similar POC in the industry”, Barrick said last year.

At Kibali, in the Democratic Republic of the Congo, which remains a world leader in underground automation with multiple autonomous machines operating on the same haulage level, the company recently completed a trial to use this technology on the mine’s production levels. This means a single operator can now control up to three machines acting semi-autonomously in different zones, Barrick said.

It added: “An additional system, which will provide real-time visibility of the underground operations, including personnel and equipment tracking, is currently being commissioned.”

And, lastly, on the electric vehicle front, the company said its Hemlo gold mine, in Ontario, Canada, has introduced a battery-powered development drill “as a first step towards establishing the potential of this new technology”.

Hemlo recently moved from a combined open-pit and underground owner-operated mine to an underground-only contract mining model as part of a plan to transition Hemlo into a Tier Two asset with a life of mine well into the future.

Barrick’s Turquoise Ridge gold operation is also evaluating new battery-electric technology, with the company confirming a battery-powered underground haul truck is being trialled at the mine.

MTU and ASI Mining to offer ‘integrated future-oriented autonomous solutions’

Rolls-Royce and Autonomous Solutions Incorporated (ASI) have signed a memorandum of understanding enabling Rolls-Royce to offer autonomous-compatible, Mobius-ready MTU engine solutions for equipment in a wide range of mining applications.

As part of the agreement, ASI Mining, a subsidiary of ASI, has agreed to ensure compatibility of MTU engines and ASI’s Mobius command and control software for autonomous vehicles.

With its brand MTU, Rolls-Royce business unit Power Systems is a leading provider of advanced power solutions for a wide variety of applications, including mining equipment. ASI Mining, meanwhile, is an industry leader in the development and sales of high-tech autonomous solutions for mining equipment and other machinery in a wide range of applications. The companies plan to leverage their experience to offer customers engine solutions that are compatible with ASI’s vehicle automation software to help optimise vehicle power performance and efficiency, thus enabling more environmentally friendly and safer mining operations, the two said.

Scott Woodruff, Global Director for Mining and Oil & Gas at Rolls-Royce Power Systems, said: “We are excited to shape the mining industry’s future together with ASI and further leverage our advanced MTU technologies. Together we will offer our customers integrated future-oriented autonomous solutions. This agreement may help mining operators save big on operational costs and at the same time, reduce their environmental footprint by cutting emissions.”

Drew Larsen, Director of Business Development for ASI Mining, said: “We are excited to start these discussions with Rolls-Royce Power Systems. This is another testament to the interoperability of Mobius and real value it adds to our mining customers.”

One potential benefit to customers of Rolls-Royce and ASI Mining may be the ability to retrofit the power system on existing haul trucks and convert them to autonomous operation, the companies said. The companies are interested in exploring the value customers would receive by modernising their trucks with more efficient MTU engines along with implementation of ASI’s industry-leading autonomous mining solutions. Customers would thus save on operating costs and further benefit from the increased performance of the autonomously optimised MTU engines, they said.

MTU says its diesel engines have been setting the standards for performance and fuel efficiency in mining applications around the globe for decades. “They reliably power vehicles for underground and surface mining, including loading vehicles such as excavators and wheel loaders, transport vehicles such as haul trucks or blasthole drilling rigs, and other mining machines – diesel-mechanic, diesel-electric or diesel-hydraulic,” it said. “For these applications, MTU engines provide high performance, reliability and availability as well as a maintenance-friendly construction. Long service intervals and an efficient use of fuel provide for exceptionally low operating costs of machines powered with MTU engines.”

ASI Mining’s Mobius, meanwhile, leverages advanced multi-vehicle command and control software to set up and manage a coordinated system of haul trucks. The Mobius Haulage Platform manages autonomous traffic, coordinates manned or unmanned vehicles and regulates the haul cycle in the most efficient way possible. By employing Mobius software, mines can improve utilisation, along with increase safety and productivity.

Epiroc and ASI Mining to automate Roy Hill haul truck fleet

Epiroc has signed a contract with Roy Hill to deliver a fully automated haul truck solution for the iron ore mining operation in Western Australia.

In partnership with automation specialist ASI Mining – which Epiroc owns 34% of – Epiroc is to convert Roy Hill’s haul trucks from manned to autonomous use. The two will deliver a safe and interoperable solution for Roy Hill’s mixed truck fleet, with an ability to expand to other mining vehicle types and manufacturers, and capability to integrate with existing Roy Hill systems, Epiroc said.

Epiroc and ASI Mining will also be working closely with Roy Hill and its partners Hitachi and Wenco on truck conversion and integration of the Wenco fleet management system.

The project will see a phased implementation, with testing and production verification of up to eight trucks undertaken in the initial phase prior to the second phase of full fleet expansion from mid-2021.

Helena Hedblom, Epiroc’s Senior Executive Vice President Mining and Infrastructure, said: “Epiroc is proud to collaborate with Roy Hill, ASI Mining and other partners to automate Roy Hill’s haul truck fleet, boosting safety and productivity for a crucial aspect of its mining operation. This is a very strong example of how automation will take a mining company’s operation to the next level.”

Roy Hill CEO, Barry Fitzgerald, said the mining company was well positioned to transition to automation. “Our teams on site and in our Remote Operations Centre (ROC) in Perth have demonstrated a clear capacity to deliver complex projects, sustainable change and operational excellence with the recent success of our autonomous drill program and fleet optimisation initiatives. Now is the right time to bring the combined expertise of Roy Hill, Epiroc, ASI Mining and Wenco together to convert our haul truck fleet.”

Fitzgerald added: “Care is one of our core values, with safety at the heart of everything we do. Roy Hill’s Smart Mine program is driving innovation across our business, and the automation of our haulage fleet is central to delivering safety and production improvements.”

Roy Hill is an iron ore mining project in the Pilbara region of Western Australia. Located 340 km southeast of Port Hedland, it has an integrated mine, rail and port facilities and produces 55 Mt/y of iron ore, with approval to increase to 60 Mt/y. Its ROC in Perth provides end-to-end integration of operations, according to Epiroc.

Epiroc trusting its 6th Sense on mine automation, electrification, digitalisation developments

During an enlightening Capital Markets Day, in Stockholm, Sweden, Epiroc backed up its credentials as a leader in the mine automation, digitalisation and electrification spaces, outlining its progress to date and its medium- and long-term plans to capture more market share.

A few weeks after putting on the investor showcase – but before Helena Hedblom was announced as the incoming President and CEOIM spoke with President and CEO, Per Lindberg, and Senior Vice President of Corporate Communications, Mattias Olsson, to get some detail behind the presentation slides.

IM: Automation featured very widely in the capital markets day (CMD) presentations earlier this month: In general, how would you characterise the mining industry appetite for this new technology? Where is the average customer on your automation scale?

PL: First of all, the appetite is very large; most customers are looking at automation in one way or another.

It is hard to do a mathematical average when it comes to where the industry currently is, but the average miner is probably down on the left-hand side of that scale (pictured below) – somewhere in between tele-remote and single machine automation.

IM: Over the next five years, where do you see most potential growth for autonomous solutions in terms of underground or open-pit mining? What market dynamics are accelerating this uptake?

PL: Most likely it will happen in both surface and underground. The potential for productivity and safety improvements is probably greater in underground, though.

This trend is clearly driven by productivity, cost efficiency and safety. Those would be the key drivers for automation. It is about taking people out of the line of fire, as well as having close to 24/7 production.

IM: Following the 34% stake acquisition of ASI Mining last year, would you say the project Epiroc and ASI are working on at Ferrexpo’s Yeristovo mine is representative of how you envisage doing business together in the future?

PL: That is the reason that we initially acquired the 34% stake in ASI Mining; we wanted to go in that direction. In that respect, I think the Ferrexpo example is representative of how we will cooperate with ASI.

Of course, ASI can also offer a standalone solution without Epiroc being present on the automation side, so we are also promoting their offering too.

IM: How does Epiroc, as an OEM, balance its machine building and maintenance service offering? Does the ability to keep machines working longer through sophisticated monitoring systems and better manufacturing somewhat inhibit your ability to sell new machinery?

PL: To a certain extent, we are probably cannibalising our new machine sales with increased service intensity and improved servicing products. That is most likely the consequence. On the other hand, we also feel that it is only right to offer this type of aftercare and servicing.

Yet, you cannot continue to prolong the life of a piece of equipment forever. It needs to be replaced at some point.

Overall, the servicing offering works well for us and, we think, it is good for our customers in terms of increasing the life of their equipment.

IM: Factoring this in, what percentage of revenue is your aftermarket business likely to represent in the next 10 years (from 65% today)?

PL: It’s difficult to say if it is going to be higher, or not, but it is likely that the volume of service will increase. That is based on what we are talking about – the intensified servicing we are offering, the products we have developed and the fact that we are increasing the market share within our own fleet.

Whether it continues to be 65% of the overall business depends on activity in the rest of the group.

IM: Along these lines, how long does the company anticipate its new battery-electric loading fleets lasting compared with, say, the diesel-powered fleets you were selling 10 years ago?

PL: The wear and tear of the actual machine will be the same – that is not going to change because of the drivetrain.

But, having an electric drivetrain is different from diesel; we have to see what the long-term maintenance needs are compared with diesel. The life of the drivetrain also depends very much on the utilisation of the machine.

IM: Of the recent innovations the company has launched (or is about to launch) – 6th Sense, a semi-automated explosives delivery system (with Orica), Scooptram Automation Total, Powerbit, etc – which has the strongest business case in mining?

PL: I think 6th Sense is really a packaging of all of our different offerings within automation. In that regard, it is has the highest potential. Which components of 6th Sense have the highest potential? We’ll have to wait and see.

The semi-automated explosives delivery system with Orica is a very specific innovation, but we very much believe in automating this mining process because of the safety and productivity benefits it brings. But we are only just starting this development compared with 6th Sense, which has already launched.

Powerbit is, again, very specific, but…allows us to deliver a complete offering both in terms of machine and consumables that will enable higher productivity and automation. That should have a high potential in the market.

IM: What does the Epiroc mining roadmap look like for the next 10-30 years? I imagine wider adoption of hard-rock cutting, automation, electrification and digitalisation are in there, but what other technology evolutions are being planned for?

PL: We have to continue to work with all of those three – automation, electrification and digitalisation – as they will deliver significant benefits for the industry. That is where we need to focus over that 10-year timeframe.

These three also have the potential to further integrate the value chain in mining within the future digitalisation space. We need to both continue to work with these technologies and our customers to ensure we have greater market penetration in all these areas.

IM: And, hard-rock cutting? Is this as important as these three?

PL: For specific applications, mechanical cutting and the Mobile Miners have their relevance and work well. But we believe for the foreseeable future, the majority of hard-rock excavation will be carried out by drilling and blasting in the mining and tunnelling sectors.

IM: During the CMD there was mention of “cost per measure” contracts under the digitalisation heading. Could you go into some detail about how the company is offering these and if they are tied in with financing agreements for your equipment?

PL: In terms of cost per measure, one example would be cost per metre contracts in consumables and rock drilling tools.

MO: We also provide finance for equipment and it could be that the equipment is financed and we have a cost per metre contract in place. Those two are not connected or tied, though.

It could be that there is more of this ‘pay-for-performance’ type of contract in the future – where you charge per tonne of ore excavated, for example – but, if it does come, I don’t think it will happen quickly.

IM: Similarly Epiroc talked about “new business models” in 2020 for underground equipment at the CMD. What might these new business models be? What is the need for them?

PL: It could be revenue streams into software, to information management, to advanced service agreements, to Batteries as a Service for battery vehicles.

The reasons for establishing these models is the continuous development of software, new updates for machines, etc that require different models.

When it comes to Batteries as a Service, it is a different model again looking to transfer the energy cost of the battery from capex to opex in order to facilitate the timely decisions for customers and reduce the cost of operation for our customers.

These new models are all based on development of technologies.

Battle for greenfield mining autonomy

The big two global giants in autonomous mining truck solutions continue to battle it out in chasing new contracts, especially for greenfield mines that offer a chance to supply more profitable “new” autonomous fleets as opposed to retrofitting autonomous capability onto existing fleets.

The main battle grounds remain Australian iron ore in Western Australia’s Pilbara region and Canadian oil sands in the Alberta production hub centred on Fort McMurray, though there are also surface haul truck autonomy trials ongoing in other mine types such as iron ore in other parts of the world, gold, coal and copper.

In iron ore the competition has turned traditional norms on their head.

Rio Tinto, traditionally a Komatsu truck user, announced earlier in 2019 that it had agreed to work together with Caterpillar to create an automated mine operation at the Koodaideri iron ore project, in Western Australia. The agreement will see Cat® and dealer WesTrac supply and support mining machines, automation and enterprise technology systems for the new mine. Rio, in a separate release, said this would see the supply of a fleet of 20 new autonomous 793F trucks.

Then in September, BHP, traditionally a Caterpillar truck user, turned the tables again by announcing that it will deploy 41 new Komatsu 930E-5 ultra-class autonomous haul trucks at its new South Flank iron ore mine in the Pilbara region of Western Australia, commencing in October 2019.

But OEM battles aside, autonomy comes with its own issues. This includes the mine having sufficient network capacity in place but also other practicalities like how it ties in with haul road design and how it affects OTR tyre performance.

This tyre angle is being delved into in some detail by Tony Cutler, Principal at specialist consultancy OTR Global, at the forthcoming inaugural Truck & Shovel Conference from International Mining Events, running 19-20 September in Singapore at the InterContinental, Middle Road.

His talk, “Factoring tyres into autonomous haulage”, will point out that since 2008, over 400 autonomous haul trucks have entered commercial operation on open-pit mines and, while autonomous haulage offers improved productivity, safety and operating cost, he argues that the main constraint to maximising these benefits is tyres. This presentation identifies the limitations associated with tyres – some inherent to the tyres, others to the autonomous systems and operating environments – and suggests solutions.

Cutler will be joined in an autonomy related session by Drew Larsen, Director of Business Development, ASI Mining, in a presentation titled: ‘Autonomous Mining – more feasible than you might think’.

The company, 34% owned by global mining OEM Epiroc, began work on a project with Barrick Gold to retrofit and automate a fleet of Komatsu 930-E Ultra Class haul trucks at the Arturo joint venture operation in Nevada, last year, and judging from Barrick’s commentary in its June quarter results, the gold miner is happy with how things are going.

Interestingly, Barrick said initially none of the OEMs wanted to engage in the project, “due to the mammoth task of retrofitting an autonomous system to a 20-year-old fleet of ultra-class trucks and the technological limitations that come with that age of machine”.

Barrick found another partner in ASI that specialises in autonomous solutions both inside and outside the mining industry and has now successfully completed a proof of concept (POC) utilising five haulage units “that have delivered over 5.5 Mt faster than any other similar POC in the industry”, it said.

These autonomous solutions require a lot of data to be effective and while there are no shortages of nodes on equipment nowadays, the haulage and loading industry is still coming to terms with how best to leverage this data.

Speakers from Komatsu will be confronting this issue head on at the event, with Jason Knuth, Senior Manager – Data Solutions, and Simon Van Wegen, Product Manager – Data Solutions, presenting a keynote titled, “Data-driven designs for dynamic mining environments”.

The two intend to reveal how OEMs are leveraging the plethora of data nodes on smart equipment to adapt equipment and design solutions for the modern mine environment.

To hear from more speakers like this, register for Truck & Shovel by clicking here.

Truck & Shovel conference gains Singapore Mining Club support

The inaugural Truck & Shovel conference is now just over seven weeks away and the stage is set for an exciting event looking into the future of the global loading and haulage industry.

With topics such as automation, digitalisation, fleet management, and tyre and fuel optimisation on the agenda, there will be much to discuss at the 1.5-day event, taking place at the InterContinental Singapore, Middle Road, on September 19-20.

In addition to gaining the support of Komatsu Mining (Platinum Sponsor), Zyfra Mining (Gold Sponsor) and Mining Industry Professionals (Media Sponsor), IM Events is pleased to announce that the Singapore Mining Club has backed this global event.

Truck & Shovel 2019 will now be held in association with the Singapore Mining Club, an influential group that exists to promote development of Singapore as the pre-eminent regional hub for the management and financing of mining enterprises.

We chose Singapore for this global event for several reasons, including:

  • Many of the big mining companies have procurement and marketing hubs in this Asian metropolis;
  • It acts as a gateway through to key mining hubs such as Australia, India, China and Indonesia, and;
  • It has good transport links and an excellent reputation for event hospitality.

Taking place in Ballroom I and II of the InterContinental Singapore, this event has attracted a number of high-profile speakers that have masses of industry knowledge to share with delegates.

We plan to kick off the day with a keynote from Komatsu Mining’s Jason Knuth (Senior Manager – Data Solutions) and Simon Van Wegen (Product Manager – Data Solutions) on ‘Data-driven designs for dynamic mining environments’.

The duo, who have spoken at many high profile conferences around the world, are set to reveal how advanced mining original equipment manufacturers (OEMs) are leveraging the plethora of data nodes on smart equipment to adapt equipment and design solutions for the modern mine environment.

Mikhail Makeev, Global Business Director, Zyfra Mining, is set to continue this digitalisation theme during his catchily-titled ‘How to make your mine “rock”’ presentation. The company has automation and fleet management expertise that it has applied across many mine sites, with Makeev keen to share details on these experiences.

Automation

For those focused on surface mining automation, Truck & Shovel tackles the concept from three different angles.

Drew Larsen, Director of Business Development, ASI Mining, will provide a business case for haulage automation with a presentation titled: ‘Autonomous Mining – more feasible than you might think’. The company, 34% owned by global mining OEM Epiroc, began work on a project with Barrick Gold to retrofit and automate a fleet of Komatsu 930-E Ultra Class haul trucks at the Arturo joint venture operation in Nevada, last year, and is expecting to issue news on projects with other miners in the near future.

Tony Cutler, Principal Consultant, OTR Global, will be tackling automation from a different stance in his ‘Factoring tyres into autonomous haulage’ presentation. Research from the leading mining OEMs offering autonomous haulage systems (AHS) indicates these systems have the potential to prolong tyre life, a claim Cutler will interrogate up on stage.

And Steve Russell, Director – Mining, Scott Technology Ltd, will be looking at autonomous refuelling in his talk. With a title of ‘Robofuel Robotic Refuelling – A safety and productivity initiative for the 21st Century Mine’, he will highlight case studies that showcase just how effective this process is in an open-pit mining context.

Equipment design and innovation

The look and feel of loading and haulage equipment hasn’t changed dramatically over the past few decades, but with mining companies and OEMs now receiving data in real time about how trucks and excavators are operating and interacting with each other, one would expect these design blueprints to, in the future, be altered in some way – for example Komatsu’s cabless haul truck concept.

Taking on this topic at the event will be Christopher B Althausen, Director of Sales & Marketing for Pioneer Solutions LLC, and Brad Rogers, CEO of Bis Industries.

Althausen’s presentation, ‘Mining truck design and development: challenges, hurdles and solutions’, looks at his and his company’s experiences approaching haul truck design over many decades. Rogers’ talk, meanwhile, focuses on ‘Innovation in minesite haulage’. With Bis Industries now having successful trials of its revolutionary Rexx haul truck in its back pocket, delegates will look forward to hearing all about the proven productivity benefits of using this 20-wheel machine.

Maximising payload

The first day of the event will finish with a packed session on truck bodies and excavator buckets where four speakers will highlight just how effective customised solutions can be in the open-pit mining environment.

Carl Samuelson, Global Business Support Manager, Metso Haul Truck Solutions, will talk about successes the mining OEM has had with its hybrid haul truck tray, the Metso Truck Body, while David Pichanick, Global Manager Market Development & Innovation, Austin Engineering, will reveal how thinking ‘outside the box’ and changing the way the company uses materials in dump bodies and buckets has had an impact on safety and productivity. Tom Smith, Engineering Manager at DT HiLoad, rounds out the truck body talk, presenting, ‘HERCULES: The Strongest Tray in Earth’.

Ian Cornfoot, Managing Director of G&G Mining, has the honour of closing day one with a presentation on the use of customised excavator buckets titled, ‘Moving Rocks Not Steel – “Productive innovations in earthmoving buckets”’.

Fuel efficiency and management

As has been well documented, fuel efficiency is key when it comes to open-pit mining, with optimised fuel selection and management often keeping the cost per tonne down.

This topic kicks off day two of the event, with Kevin Dagenais, CEO of Blutip Technologies, looking at the use of predictive modelling techniques to target mining inefficiencies in this space. Sean Birrell, Group Product Officer, FluidIntel, follows closely behind him on ‘Analytics opportunities in fuel and lubricant management – unseen risks & untapped value in your supply chain & operations’, with Joao Silveirinha, Chief Technology Officer of Banlaw, rounding out the fuel talk with a talk titled, ‘Digital Transformation and Automation as it relates to the management of Hydrocarbons in Mining’.

Safety and training

The last session of the conference is all on safety and training, with two speakers keen to talk up the benefits of these in open-pit mining where accidents can cost lives and machines.

Daniel Bongers, Chief Technology Officer of SmartCap Technologies, will present, ‘Zero fatigue incidents achieved – moving to alertness monitoring’ in his 30-minute slot, with Graham Upton, Director of Business Development at simulator specialist, Doron Precision Systems Inc, following him with ‘Shovel and Truck, side-by-side Coordinated Training’.

For details of how to register for this event, or access the full program, please visit the website: https://im-mining.com/truck-and-shovel/

Please note, all company delegations of two or more people are entitled to a discount. Get in touch with Editorial Director, Paul Moore ([email protected]), or Editor, Dan Gleeson ([email protected]), for more information.

Epiroc M&A likely to continue, Per Lindberg says

The President and CEO of Epiroc, Per Lindberg, says the mining equipment maker is likely to continue making acquisitions as it strives for long-term growth over the latest business cycle.

In the company’s first full year of operation, Epiroc has, among other transactions, acquired a minority stake in mining autonomy major ASI Mining, agreed to buy rock tools manufacturer Fordia, and purchased Sautec.

Lindberg said in the company’s December quarter results that Epiroc is targeting to grow at least 8% per year on average over a business cycle.

“While we grew well beyond that in Q4 and in 2018, we believe we continuously need to make acquisitions to secure long-term growth as well as access to new technologies, markets and geographies,” he said.

On the recent Fordia, New Concept Mining and Sautec buys, Lindberg said Epiroc expected strengthened positions in exploration, rock reinforcement and service, and an additional SEK 1.2 billion ($132 million) in annual revenues.

In the December quarter, Epiroc said its orders received increased 17% to SEK9.47 billion, revenue jumped up 25% to SEK10.56 billion and its operating profit went from SEK1.53 billion to SEK2.16 billion, including costs related to the split from Atlas Copco and change in provision for long-term incentive programmes of net SEK8 million.

Lindberg reflected on this quarterly performance, saying: “We have been able to ramp up our capacity in manufacturing and service to support our customers, and revenues reached a record SEK10.56 billion, up 19% organically.”

He added: “In our first year as Epiroc we achieved strong growth in both top and bottom line, in parallel to a successful split and introduction of the new company. Reported orders and revenues increased 16% and 22%, respectively. Our operating profit increased by 25% and the operating margin, adjusted for split costs and provision for long-term incentive programmes, increased from 19.4% to 20.3%.”

Lindberg said customer demand for Epiroc’s equipment, services and tools remained at a good level during the quarter. “In mining we continue to see that the majority of the equipment orders are for expansion, including also some orders for greenfield projects,” he said, while aftermarket business was supported by high activity among its customers, leading to strong growth.

During the most recent quarter, Epiroc launched the second generation of its battery-operated equipment at an event in Örebro, Sweden.

Lindberg said the event created strong interest from Epiroc’s customers and orders have already started to come in.

In terms of the future technology transition in mining, in general, Lindberg said: “Our customers are ready for a major technology shift towards more automation, digitalisation and battery power.

“While the complete transition will take time, it is exciting to already now see the positive customer reactions.”

Looking into 2019, Lindberg said: “We will continue to focus on improving our customer offerings, our efficiency, agility and resilience. These are, and will continue to be, the strengths of Epiroc.”