Tag Archives: contract mining

Barloworld Equipment offers Exxaro mine contractors a helping hand

Coal technology, Mining equipment, Mining finance, Mining services, Steel and iron ore, , , , ,

Exxaro Resources and Barloworld Equipment (BWE) have signed a memorandum of understanding that could see the mining company’s contractors gain access to the required mining operations equipment at competitive rates and terms, as well as additional post-acquisition support to enable the contractors to execute operational projects.

The three-year, non-exclusive partnership aims to assist Exxaro’s contractors working on the projects including drilling, blasting, loading, hauling and coal handling. Previously Exxaro noted that contractors awarded work lacked the means to purchase or lease the equipment required to enable them to execute said projects.

Mxolisi Mgojo, Exxaro CEO, said: “Exxaro has committed to an enterprise and supplier development program to grow the South African economy within the sector and bolster efficiencies in areas we operate. This partnership enables us to empower and support appointed contractors to produce the best quality work.”

The partnership also looks to capacitate Exxaro contractors to build an effective equipment management capability to support the efficient delivery of projects; and find ways to minimise the capital and operating costs of equipment for contractors by dealing directly with BWE as the authorised distributor and reseller of equipment, Exxaro said.

Emmy Leeka, BWE Southern Africa CEO, said: “This partnership with Exxaro will allow emerging contractors to better participate in major projects. As the exclusive dealer for Cat earthmoving machines and power systems in Southern Africa, we will give Exxaro’s contractors greater access to equipment, financing and training.”

Exxaro looks to enter into similar partnerships with Komatsu, Volvo, Bell and other companies alike.

MACA to help FQM with Ravensthorpe nickel mine restart

Base metals, Mine operation news, Mineral project development, Mining services, , , , , , ,

MACA says it has received a letter of award from First Quantum Minerals related to carrying out open-pit mining services at the Ravensthorpe nickel project in Western Australia.

On care and maintenance since October 1, 2017, due to the persistently low nickel price, Ravensthorpe involves open-pit mining and beneficiation of nickel laterite ore, pressure acid leaching, atmospheric leaching, counter current decantation, precipitation and filtration to produce a mixed hydroxide precipitate product, containing approximately 40% nickel and 1.4% cobalt on a dry basis.

First Quantum hinted earlier this year that a restart could be on the cards following a sustained nickel price run. Restart costs, should favourable conditions prevail, are estimated at $10 million, the company has previously said.

The final contract award with MACA is subject to finalisation of documentation with all major terms having been agreed, the ASX-listed contractor said.

Mobilisation to site is expected to commence in December with operations commencing from January.

The project will consist of open-pit mining services including drilling and blasting, and loading and hauling, and is expected to generate around A$480 million ($327 million) in revenue for MACA over the initial five-year term.

MACA said its total work in hand position now stands at A$2.5 billion and its financial year 2020 revenue is expected to be around A$770 million.

MACA Operations Director, Geoff Baker, said: “We are very pleased to have been selected preferred contractor and look forward to developing a long-term working relationship with the First Quantum team at the Ravensthorpe nickel project.”

Mitchell Services ups pureplay drilling ante with Deepcore Drilling acquisition

Explosives and blasting, Mining equipment, Mining mergers and acquisitions, Mining services, , , ,

Mitchell Services has agreed to acquire Deepcore Drilling for A$32 million ($22 million) in cash and shares, turning the ASX-listed company into, it says, one of the largest and most diversified pureplay drilling services companies in Australia.

The acquisition is expected to be 38.5% earnings per share accretive based on pro-forma financials and the agreed A$15 million cash and A$17 million shares deal.

Deepcore is a privately-owned company providing services to the mining and infrastructure sectors. It specialises in highly technical underground mobile drilling, including specialty acoustic drilling that Mitchell does not currently provide and deep hole directional diamond core drilling, the company said.

Mitchell has increasingly been expanding into new segments of the drilling market in order to capture market share and, in July, entered the drill and blast production drilling market with the award of a new contract at Adaman Resources’ Kirklalocka gold project in Western Australia.

Mitchell said Deepcore, which also carries out surface drilling, is primarily gold and copper focused, balancing the company’s existing commodity mix. It has 32 drill rigs and is involved with work primarily in Victoria and New South Wales, where Mitchell already has a small presence.

Deepcore is majority owned by founder Scott Tumbridge, who will be invited to join the Mitchell board as an Executive Director after the transaction is completed; expected to be by end-2019. Deepcore had 2019 financial revenues of A$46.5 million and EBITDA of $6.3 million.

NRW in the lead for BGC contract mining business

Mining mergers and acquisitions, Mining services, , ,

NRW Holdings, in response to recent media speculation, says it has been selected as the preferred bidder in the sale of BGC Contracting.

The company said it has consistently stated it is pursuing opportunities to “further diversify its revenues and enhance shareholder returns”, with this including discussions with various parties regarding potential acquisitions. This included talks with BGC Contracting.

Earlier this year, BGC Contracting’s owners, BGC Pty Ltd, said it was exploring options for the group’s national contract mining, maintenance and civil construction business.

While NRW confirmed its preferred bidder status for BGC, it said this status was subject to final documentation and a number of conditions considered “customary in this type of transaction”.

“NRW believes there is significant merit in the acquisition of BGC Contracting and would only enter into a transaction applying a similar discipline to previous transactions (Golding Group and RCR Mining Technologies) on terms that deliver appropriate value for NRW shareholders, including a requirement that any transaction be earnings per share accretive,” it said.

NRW said it has multiple funding options available to it and, furthermore, any transaction would include the assumption of outstanding equipment finance obligations of approximately A$190 million ($131 million), “which is well supported by a considerable fleet of major mobile equipment”.

BUMA to tap into tech startup environment with Plug and Play platform

Coal technology, Equipment maintenance, IoT, Mining equipment, Mining maintenance, Mining safety, Mining services, , , , , , , ,

PT Bukit Makmur Mandiri Utama (BUMA), one of Indonesia’s top mining contractors, has partnered with Plug and Play’s global open innovation platform to engage with startups focusing on predictive maintenance, safety and health technology.

Ronald Sutardja, BUMA CEO, said the company was looking to engage with such companies to build “breaking ground technologies” in mining services.

“Technology has always been part of our DNA and we’re striving to be the most technologically advanced company in the business,” he said.

BUMA, currently the second largest independent coal mining contractor in Indonesia according to parent company PT Delta Dunia Makmur Tbk. It carries out a comprehensive scope of work from overburden removal, coal mining, coal hauling as well as reclamation and land rehabilitation.

Plug and Play said: “Having technology in place is not merely about improving worker productivity or acquiring more accurate data, but it is also about improving safety conditions for BUMA’s employees and improving employee’s health.”

Eko Prihadi, Director at BUMA, recently said at Plug and Play’s APAC Summit in Singapore in May 2019: “Safety is one of our biggest priorities in BUMA. As we currently employ more than 13,000 people, we are continuously on the lookout for the latest technologies to improve the well-being and working conditions of our employees.

“As a highly progressive company, innovation is the key to our operations. This partnership will give us access to the global startup ecosystem and allow us to work with the latest cutting-edge technologies to develop innovative business strategies in key focus areas.”

Plug and Play’s Supply Chain platform is, according to the company, the world’s leading innovation consortium with strategic locations in Silicon Valley, Hamburg, Shanghai, and Singapore. Focusing on key areas of relevance, Plug and Play will identify and connect its partners with the latest technologies that will accelerate their innovation efforts.

Wesley Harjono, Managing Partner of GK-Plug and Play Indonesia, said: “We are very excited to have BUMA join us as our newest supply chain partner. Since the inception of the platform out of Silicon Valley in 2016, the vertical has amassed more than 35 industry-leading corporate partners including DHL, ExxonMobil, and ArcelorMittal. Partnering with BUMA will help us drive technological advancements in key areas such as safety, wearables, and IoT in the mining industry.”

Downer receives two-year extension at BMA’s Goonyella Riverside coal mine

Coal technology, Mine operation news, Mining services, Steel and iron ore, , , , , , , ,

Downer EDI says it has been awarded a A$200 million ($134 million) contract extension to provide mining and related services at BHP Billiton Mitsubishi Alliance’s (BMA) Goonyella Riverside coal mine, in Queensland, Australia.

The two-year contract commences today and replaces an existing agreement that commenced in 2016 and expired on September 30, 2019. It also has provisions for it to be extended for up to a further three years.

The scope of work to be carried out by Downer under the contract is pre-strip overburden removal, with Downer intended to use existing capital equipment to carry out this task.

Chief Executive Officer of Downer, Grant Fenn, said: “Downer has been working closely with BMA at a number of mine sites for many years and we look forward to continuing to provide safe and productive services at the Goonyella Riverside coal mine.”

Downer is providing similar services in Queensland at the likes of Blackwater, Goonyella, Commodore and Meandu mines.

Eurafrican Diamond Corp to mine Marsfontein gravels in South Africa

Diamond mining, Mine operation news, Mineral project development, Mining services, , , , , , , ,

Botswana Diamonds and its associate Vutomi have signed an agreement with Eurafrican Diamond Corp to mine and process the diamond-bearing gravels and residual stockpiles on a portion of the Marsfontein farm, in South Africa.

The agreement gives EDC a contract for the mining and processing of the identified deposits on the Marsfontein Mining Permit, with 25% of the pre-tax revenue from larger or high value ‘Special Stones’ (any stones weighing 10.8 ct or more, or valued at more than $8,000/ct) and 15% from the standard run of mine stones accruing to Vutomi, which is 40% owned by Botswana Diamonds.

Vutomi was recently granted Environmental Authorisation over a substantial portion of the residual diamond-bearing gravels produced from the high grade Marsfontein mine, which is contiguous to Botswana Diamonds’ Thorny River operation. Thorny River has been modelled to contain 1.2-2 Mt of material (to 100 m) with a diamond grade ranging between 46-74 ct/ht and diamond values in the range of $120-$220/ct.

John Teeling, Chairman of Botswana Diamonds, said the partnership with EDC paves the way for commercial production to re-start on Marsfontein and Thorny River.

“EDC has a rich history of successful diamond mining and processing and has excellent technical and financial support,” he said. “Furthermore, EDC and Vutomi projects complement one another, providing a strong project pipeline.”

EDC, established in 1964, has long been a premier diamond miner and processer, and is currently mining and processing the Schuller kimberlite pipe and diamond-bearing gravels around Petra’s Cullinan diamond mine.

The contract mining and processing agreement allows for the continued contractual bulk sampling on the Thorny River project, as well as first refusal rights, between EDC and Vutomi, on all their South African diamond exploration and development projects.

While the Environmental Authorisation was granted for Marsfontein on September 12, Botswana Diamonds said it was expecting the remaining regulatory grants shortly.

BlueRock hopes for Kareevlei diamond mining upgrade with Teichmann contract

Diamond mining, Mine operation news, Mining services, , , , , , ,

BlueRock Diamonds, the owner and operator of the Kareevlei diamond mine, in the Kimberley region of South Africa, has instructed Teichmann South Africa to provide mining services to the company.

BlueRock announced back on May 16 that it was in negotiations with a member of the Teichmann Group to provide the quantity of ore necessary to meet BlueRock’s production plans.

The diamond miner said Teichmann’s extensive experience in mining operations is expected to significantly de-risk the company’s mining activities and allow BlueRock to meet its production targets in a “cost-effective manner”.

The Kareevlei licence area covers 3,000 ha and hosts five known diamondiferous kimberlite pipes. As at November 2018, it was estimated that the remaining inferred resource from the four kimberlitic pipes (KV1, KV2, KV3 and KV5) represents a potential in-ground number of carats of 367,000, BlueRock says.

The contract is for a period of five years commencing with an effective start date of July 1 and includes the extraction of ore and waste, haulage of said material to a stockpile, breaking down ore to the required size when required, and delivering ore to the processing plant.

BlueRock said: “Unlike the agreement with the previous provider of these services which was paid on an hourly basis with a minimum number of hours guaranteed, Teichmann will be paid almost entirely on a cost per tonne basis and, accordingly, the effective cost per tonne is reduced with the planned increased production.”

Based on the lower end of the company’s current production expectations, the estimated cost of Teichmann’s services for the 12 months ending June 30, 2020 will be around ZAR21 million ($1.4 million).

Mike Houston, Executive Chairman, said: “The upgrading of our mining operation is key to the overall success of the business and having an experienced mining contractor is an essential part of this process. I believe that our partnership with the wider Teichmann Group will provide further benefits going forward as we continue to implement our defined growth strategy.”

NRW’s Golding to operate new trucks, excavators at Isaac Plains East coal mine

Coal technology, Mine operation news, Mining equipment, Mining services, Steel and iron ore, , , , , , , , , , , ,

NRW Holdings’ wholly-owned subsidiary, Golding Contractors, has reached agreement with Stanmore Coal to increase overburden removal capacity at its Isaac Plains East mine in Queensland, Australia, with the addition of a third truck and excavator fleet.

During 2019, the mine has continued to increase production and the new contract mine plan is seeking to sustain current coal production volumes of around 3 Mt/y of run of mine (ROM) material.

The two companies, in November, agreed to extended the contract mining services contract for at least another five years.

The third fleet will commence operations in August, with Golding supplying an additional Hitachi EX3600 excavator, five EH3500 Hitachi trucks and the remainder of the ancillary fleet, the majority of which will be mobilised from NRW’s Middlemount project, NRW said, adding that the five EH3500 trucks will be replaced by 5 EH4000 Hitachi trucks as they become available from the Middlemount project.

Stanmore Coal has also entered into binding agreements to acquire a 600-t Caterpillar 6060 excavator for the Isaac Plains East mine from Cat dealer Hasting Deering. This will be commissioned later in the year, NRW said, with Golding operating and maintaining the machine. It will either move prime overburden in front of the dragline or overburden in dedicated excavator and truck pits uncovering coal, according to Stanmore Coal.

Stanmore said: “Once the environmental approvals are granted for the Isaac Downs project, it is planned that the excavator will transfer to Isaac Downs to commence the box-cut operation to establish the mine. Operations at Isaac Plains East will continue in parallel with the development of the Isaac Downs project.”

The total investment is expected to be A$13 million, which includes additional workshop facilities and associated equipment expenditure at Isaac Plains to support efficient maintenance practices, the company said.

The value of the increase in scope of the contract adds approximately A$450 million ($315 million) to the existing five-year contract Stanmore and Golding have in place, NRW said. The total contract sum is estimated to be around A$950 million at the current mine production levels.

NRW CEO and Managing Director, Jules Pemberton, said: “This amendment is built on the back of a productive relationship and a positive transition for both Stanmore and Golding to the Isaac Plains East operations. We expect our capital commitment to be very low at around A$10 million as we are able to utilise fleet secured through an agreed early release from the Middlemount Coal contract.

“The Middlemount contract is not formally due for completion until the end of the 2020 financial year, however we will be able to release certain fleet prior to that date and some fleet will also likely remain on site beyond the formal contract end date. As the Middlemount project is a maintained dry hire contract, the release of our fleet will enable us to re commit these assets to existing and new full-service contract mining opportunities in line with our mining divisions delivery model.”

Consultant Measured Group updated the Isaac Plains reserve in August 2018 with current estimates supporting over 10 years of open-pit mining at planned mining rates of 1.2-1.8 Mt/y of product coal. Total open-pit reserves as at August 2018 were 14.9 Mt (run of mine).

The contract amendment is tied to Stanmore Coal’s decision to defer the Isaac Plains Underground project and prioritise its Isaac Downs project, which has higher margin ROM coal to feed the coal handling preparation plant, Stanmore Coal says.

Stanmore Coal said the Isaac Plains Underground bankable feasibility study had been completed and confirmed a positive business case for the new underground mine with potential production ramping up to an average of 1.2 Mt/y of saleable coal from year two of the production plan.

“The quantum of product tonnes forecast for the underground combined with the open-cut sources exceeds the current CHPP and contracted port capacity. Stanmore Coal is prioritising its highest margin ROM coal at Isaac Plains East and Isaac Downs project, to maximise returns to shareholders. Accordingly, the Isaac Plains Underground project will be deferred until additional port and CHPP capacity are secured or until mining at the Isaac Downs project is largely complete, subject to prevailing business conditions.”

AusTin transitions to owner mining at Granville East mine in Tasmania

Mine operation news, Mining equipment, Mining services, Precious metals, , , , ,

AusTin Mining has commenced owner mining at the Granville East tin mine in Australia, just over a week after liquidators were named to its previously appointed mining contractors, Jemrok Pty Ltd.

The decision to adopt owner mining as opposed to appointing another contractor was based on minimising disruption to the project by using existing equipment at site and employment of ex-Jemrok employees, the ASX-listed company said.

The company commenced tin mining at the Tasmania operation just last month.

AusTin Mining said: “The company considers owner mining will deliver greater control and improvement in mine productivity following a decline in productivity in early 2019.

“Under the owner mining model, waste mining operations have resumed following a period of lost production attributable to the collapse of Jemrok, and ore mining is expected to resume in the coming fortnight.”

Owner mining operating costs for Granville are estimated at A$100,000-A$130,000 ($70,655-$91,851) per month depending on blasting requirements and are inclusive of equipment rental, fuel and labour. “Owner mining should deliver a lower mining cost based on the removal of the contractor’s margin,” the company said.

Jemrok was previously contracted to also provide crushing and ore-haulage services but the company is now progressing discussions with a third party for these services. In the interim, AusTin has transported the relatively friable hangingwall ore that doesn’t require crushing to the processing plant for treatment.

This has, initially, led to an increase in plant feed grade but has necessitated a change in operating strategy to accommodate the increased level of sulphides associated with this material in order to achieve the targeted concentrate grade of 60% Sn.

“Upon implementation of contract crushing, the company will be able to increase the proportion of competent skarn ore that contains lower sulphide level and historically has been the predominant ore source for the project,” AusTin said.