Tag Archives: Jakob Stausholm

Rio Tinto looks to renewably power Gladstone ops with Australia’s largest solar power project

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Rio Tinto says it will drive development of Australia’s largest solar power project near Gladstone, Queensland, after agreeing to buy all electricity from the 1.1 GW Upper Calliope Solar Farm to renewably power its Gladstone operations.

The agreement will bring more renewable power into one of Australia’s most important industrial hubs and marks another step towards Rio Tinto’s climate goal of halving its global Scope 1 & 2 carbon emissions this decade, the mining company said. If combined with more renewable power and suitable firming, transmission and industrial policy, it could also provide the core of a solution to repower Rio Tinto’s three Gladstone production assets – the Boyne aluminium smelter, the Yarwun alumina refinery (pictured) and the Queensland Alumina refinery.

Under a new power purchase agreement (PPA) signed with European Energy Australia, Rio Tinto will buy all power generated from the Upper Calliope solar farm for 25 years. The plant will be built and operated by European Energy, at a site about 50 km south-west of Gladstone, pending development and grid connection approvals.

Once approved and developed, Upper Calliope would have the potential to lower Rio Tinto’s operating carbon emissions by 1.8 Mt/y, the company says.

Rio Tinto Chief Executive, Jakob Stausholm, said: “This agreement is a first important step in our work to repower our Gladstone operations and illustrates our commitment to keeping sustainably powered industry in central Queensland.

“The task remains challenging, but we have a pathway to provide the competitive, firmed power our Gladstone plants need and we are continuing to work hard with all stakeholders, including the Queensland and Australian governments, on getting there.

“Competitive capacity, firming and transmission are critical to developing a modern energy system that can ensure more large-scale renewables development in Queensland and help guarantee the future of Australian industry.”

Once approved, construction of the Upper Calliope plant is targeted to start in 2025 or 2026 and, when complete, it will provide enough electricity to meet about 5% of Queensland’s current demand. The plant, which is expected to take two years to construct, will cover 2,400 ha, employ 1,000 people during construction and support 100 direct and indirect jobs when operating.

European Energy CEO, Erik Andersen, said: “European Energy is proud to be a strategic partner in this project with Rio Tinto. Our commitment to providing renewable and reliable energy aligns perfectly with Rio Tinto’s ambitious climate goals. The Upper Calliope Solar Farm is not just a solar power project; it’s a testament to our shared vision for a greener future.

“By supplying renewable energy to one of Australia’s key industrial hubs, we are setting a new standard for industrial energy consumption. This project underlines our dedication to driving the transition towards renewable energy in Australia and demonstrates the potential of solar power in transforming the energy landscape of the region. We look forward to continuing our collaboration with Rio Tinto and other stakeholders to create a sustainable and energy-efficient future for Australia.”

Upper Calliope is the first successful applicant in a formal Request for Proposals made by Rio Tinto for renewable power and firming projects in central and southern Queensland.

Rio Tinto says it continues to assess other proposals, solutions and partnerships to help competitively meet the energy needs of its three production assets in the Gladstone region. These assets require more than 1 GW of reliable power to operate, which equates to over 4 GW of quality wind or solar power with firming. Potential further electrification of plant processes could increase their electricity demand in the future.

Rio Tinto and Codelco formalise Nuevo Cobre joint venture

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Rio Tinto has today completed the acquisition of Pan American Silver’s stake in Agua de la Falda and entered a joint venture with Corporación Nacional del Cobre de Chile (Codelco) to explore and potentially develop the company’s assets in Chile’s prospective Atacama region.

The acquisition, announced on August 1, 2023, comprises a 57.74% operating stake in Agua de la Falda for $45 million and the grant of net smelter returns royalties. It paves the way for Rio Tinto and Codelco to start its joint exploration project at the asset.

Jakob Stausholm (left), Rio Tinto Chief Executive, and Maximo Pacheco (right), Chairman, Codelco, today met in Tokyo to formalise the new joint venture, which will be known as Nuevo Cobre (New Copper).

Stausholm said: “Chile is one of the most important sources of the copper and other critical minerals the world needs to deliver the energy transition and achieve net zero. With this partnership, we are bringing together our complementary experience and capabilities. Codelco’s local knowledge and expertise is second to none and we have a global track record in exploration. I am very much looking forward to getting our work on the ground started.”

Pacheco said: “This is an unbeatable opportunity for Codelco and Rio Tinto to join our knowledge, experience, strengths and capabilities to accelerate exploration and development of these assets to contribute the copper that the world needs for its energy transition. We are very pleased to formalise this partnership with Rio Tinto and acknowledge our mutual commitment to following the best standards of health, safety, community relations and care for the environment.”

Agua de la Falda has previously been explored for precious metals with minimal modern exploration for copper. Analysis by Rio Tinto Exploration indicates it is prospective for new copper discoveries, which will now be the focus of the joint venture.

The partnership builds on a collaboration agreement between the two companies signed in October 2022, aimed at encouraging innovations and technology to improve safety, productivity and environmental, social and governance outcomes in underground mining.

Mining and space sectors collaborate to solve the biggest challenges

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A quiet revolution is underway in the mining sector as innovations and knowledge gleaned from space exploration help improve productivity, reduce emissions and create better outcomes for workers and communities, AROSE* Program Director, Michelle Keegan, explains.

The extreme demands of Space exploration and the drive for efficiency in the mining industry is creating new forms of cross-sector collaboration not seen before. The transfer of expertise and technology between these two sectors is also delivering solutions to some of humanity’s greatest challenges.

There are many commonalities between modern resource businesses and space exploration. Both require a focus on a smaller footprint, the delivery of zero-carbon emission operations and a reliance on substantial amounts of data to support decision making. They both operate in sensitive and challenging geographic environments and need to work in a way that reduces risks to their employees and the environments in which they operate.

The space industry provides a rich learning platform for the resources sector, for new approaches to increasingly difficult challenges. But the benefits of collaboration are not all one way. The space sector too is benefitting from the technological innovations and experience of miners here on Earth.

Technology developments in exploration precision, resource planning, advanced mineral detection sensors, in-situ extraction methodologies and advanced safety systems, present opportunities for insights and application in space.

Deep thinking around regulatory frameworks for responsible and sustainable space exploration and development will be enhanced through the experiences, both positive and negative, in terrestrial resource development.

Diversity of thinking

The opportunity to transfer technology and drive diversity of thinking from the space sector into mining will accelerate in the years ahead. Global demand for the critical minerals required to meet the world’s ambitious decarbonisation goals illustrates the need to leapfrog current approaches across the mining project lifecycle, from exploration through to production.

Rio Tinto CEO, Jakob Stausholm, recently described the global mining giant as a “technology company”.¹ In saying this he recognises Rio’s success in tackling the big challenges will rely on the miner’s ability to integrate new technologies and novel approaches to problem solving.

In a world where mining is becoming more complex, more difficult and more expensive, the ability to reduce costs (and emissions) and win the support of governments and local communities will rely on the ability to deploy technology to mine and process ore more efficiently and more safely, both for people and the environment.

Many post-carbon technologies, such as solar energy and battery storage systems, have been advanced through space exploration. Also, it is the systems engineering approach to project design, pioneered for space exploration, that increasingly is being adopted by terrestrial resources, technology and services companies.

Australia’s leading mining and oil and gas operators, as well as their major service companies, are aligning themselves with space-focussed businesses, researchers and industry organisations because they recognise the value of cross-sector collaboration. This new collaboration model is leading to greater technology and expertise transfer between space and resources. Miners also recognise the benefits of their best people being exposed to new knowledge and new ways of problem solving.

Trailblazer Lunar Rover project

The AROSE consortium was created for exactly this type of collaboration – to drive the growth of Australia’s space industry and bring together companies from resources and other industries, to leverage their collective capabilities and go after the toughest challenges in new ways. The Trailblazer Lunar Rover project is a first significant focal point for our space capable businesses and like-minded resources companies to pursue shared technology opportunities.

The AROSE Resources Advisory Board, established in 2022, creates an ongoing opportunity for the most innovative mining company leaders to provide input into the rover project, while taking learnings back to their businesses at the same time.

NASA understands well the benefits of this type of collaboration. Earlier this year AROSE participated in the first of a series of workshops with NASA and the United States Geological Service to look specifically at the areas of intersect between the resources and space sectors.

The mining industry is at a turning point in its decarbonisation journey. It has a once-in-a-generation opportunity to build new capabilities that will lay the foundations for long-term, sustainably driven growth. With an aggressive timeline to zero emissions, a great opportunity for the mining industry to solve this tough challenge is the successful building of relationships with uncommon partners like those in the space sector.

However, a broader partnership opportunity exists between mining and space. The domains we see as offering the best collaboration opportunities between space and mining include:

  • Automation and robotics;
  • Remote operations and control;
  • Geoscience;
  • Satellite communications and imagery;
  • Artificial intelligence;
  • Systems engineering;
  • Waste minimisation;
  • Digital design, including user experience and user interface; and
  • Data analytics.

It is evident space and mining projects are approached very differently. The design of a resources project is most typically achieved by bringing together the experiences of past projects, with a focus on budget and schedule. Operating concept or operating philosophy often takes second priority and does not drive the project design. As a result, an integrated systems design is never achieved. And while available technology enables some level of electrification, automation and digital decision making, the value that could be derived is never fully realised.

Andrew Dempster, Director at Australian Centre for Space Engineering Research at the University of NSW, says, “the high-level difference between the approaches of the two industries is that the mining (and oil and gas) decision points are all and always commercial, whereas the agency-driven space projects have more technical ‘system engineering’ decision criteria.”²

Dempster states “a fundamental observation about the difference between mining engineering and the space engineering disciplines (electrical, electronic, software, mechanical) is that the latter designs a product…while the former designs a business. It appears this is the fundamental disconnect”.

For many years the mining industry value chain has been unchallenged. Valuable resources are mined, processed then moved to a distribution point via rail or road and then shipped to a customer. However, there are several collaboration opportunities that could lead to mining companies rethinking value chain design, and these opportunities have the potential to alter the mining flowchart.

Perhaps the ideal approach we can use in mining is an integration of both approaches, and in this way adopt systems engineering thinking at the outset.

AI and data analytics

With an increasing need to build in automation, sensing and electrification, underpinned by digital platforms, the concept of operations needs an integrated approach more than ever. The growth in the application of AI and data analytics techniques to quickly interpret geological and physical properties of rock in mining has been exponential. As data streams become more complex and decision pressures more acute the demand for more sophisticated approaches to AI will only increase.

The space industry has had an even greater need to manage and interpret a plethora of complex data in real time to support mission critical decisions and there are obvious crossover opportunities to be explored in this arena.

With the hunt underway to locate resources on the moon or other planets to extend human life into outer space, the opportunity exists for mining technology companies to assist with rock knowledge acquisition and mineralogical interpretation of data required for successful space exploration.

Robotics and automation

The application of robotics and automation is expanding in the resources sector with the drive to remove people from harm and increase efficiency and precision in the mining process. Mining technology company IMDEX was motivated to partner with AROSE as a way of bringing space insights to the development of its BLAST DOG technology (pictured below), an automated logging system that collects detailed geoscience data from blast holes.

Major challenges IMDEX faced during the BLAST DOG development phase included: autonomous navigation over rough terrain; locating and positioning accurately over a blast hole; lowering and retrieving a sensitive, high-tech probe down the hole; and managing the transfer of high volumes of data through remote communication systems. IMDEX is refining its approach based on insights gleaned from companies involved in addressing these same challenges in space.

The recent affiliate agreement between AROSE and the Robotics Australia Group will increase this application across the industry.

Autonomous vehicles

In mining, the scale of operation has been linear until recently. If you wanted to increase mining output, you purchased more large equipment. Then came the introduction of fleet automation technologies, developed first by Caterpillar in 1996 and refined in partnership with Rio Tinto and other early adopters in the early 2000s.

Of the 1.5 million vehicles in use across heavy industry globally, only 1,200 vehicles are autonomous.³ Australia has the largest fleet of autonomous haul trucks in the world, with more than 700 in operation across 25 mines.4 Clearly the market potential is enormous.

These remotely operated technologies are challenging the need for ever larger truck sizes. The largest autonomous truck today might be the last of its kind as mining organisations consider what the ‘right size’ truck is for the future.

Smaller size trucks would allow miners to fully electrify their operations much sooner. In addition to the environmental benefits, there are operational and cost benefits that support this approach. The large autonomous trucks currently in use need enormous bi-directional roads. Reducing the size of mining vehicles can have a direct impact on strip ratios, and with a mine that can be up to 1 km deep, the roads that service the mine contribute significantly to the overall footprint.

While every mine design is different, there is a growing body of evidence that smaller autonomous vehicles can lower mine development costs (narrower benches, steeper pits, etc), speed operations and boost overall fleet utilisation.

The space industry has similar challenges with its autonomous vehicles. Where the mining industry is an expert at moving billions of tonnes of material by operating hundreds of autonomous vehicles all year round, the space industry today has only operated 11 semi-autonomous vehicles on a planetary body. This observation isn’t to diminish the significant achievement, as space exploration is extremely difficult, but to highlight the convergence of terrestrial and space objectives. For the space industry to perform in-situ resource utilisation activities anywhere off-earth, there is an opportunity to adopt learnings from the mining industry.

Likewise, the mining industry is moving towards smaller more specific/targeted mining practices and can learn from space industry experience in developing small-scale highly efficient and robust robotic solutions.

The space industry also provides a rich learning platform for the resources sector for new approaches to minimise and utilise the waste stream, with the ultimate goal of zero waste mining operations.

The companies which provide technology and services to the mining majors also realise they need to diversify their offering to include space. This ‘full stack’ approach may be a matter of business survival in a competitive future.

Remote operations specialist Fugro is a leader in this area. Fugro’s new SpAARC (Space Automation, Artificial Intelligence and Robotics Control) remote operations centre in Perth, Western Australia, has been specifically designed to share facilities between its established oil and gas and mining business and its fledgling space offering.

Fugro’s new SpAARC remote operations centre in Perth, Western Australia, has been specifically designed to share facilities between its established oil and gas and mining business and its fledgling space offering

Fugro and Nova Systems are leading the AROSE consortium’s Trailblazer Lunar Rover design team. Woodside Energy and Rio Tinto are also supporting the AROSE Trailblazer effort by providing knowledge transfer of their terrestrial robotic and automation capabilities.

Woodside has also formed a collaboration with NASA on robotics and remote operations. NASA sees Woodside as a great test bed of robotics in harsh environments, as Woodside is doing similar tasks at its operations which NASA envisages doing on the Moon and Mars.5

The largest challenges facing the mining industry are the need to get to zero emissions, the need to get to zero harm and zero waste. There’s urgency in the call to solve all of these. It is now well-recognised that we need more collaboration not just within our sector, but across sectors. With the Moon to Mars program now underway, and the Trailblazer Lunar Rover program in place, this really is a tangible point in time where things are moving forward, a tangible point where people realise that this isn’t a dream, this is a reality.

* AROSE (Australian Remote Operations for Space and Earth) is an industry-led not-for-profit organisation dedicated to ensuring Australia is the trusted leader in Remote Operations science, technology and services on Earth and in Space.

Sources:
1. ‘Solving our largest on earth challenges through the benefit of technology transfer between space and mining,’ Michelle Keegan, Gavin Gillett, Clytie Dangar, World Mining Congress 2023.

References
1. ‘We’re a tech company’: Rio boss draws on lessons of history, Australian Financial Review, 2 August 2023. https://www.afr.com/chanticleer/we-re-a-tech-company-rio-boss-draws-on-lessons-of-history-20230801-p5dt2p
2. Integrating the approaches to space and mining project life cycles, Andrew Dempster, 5th International Future Mining Conference 2021. https://www.ausimm.com/publications/conference-proceedings/fifth-international-future-mining-conference-2021/integrating-the-approaches-to-space-and-mining-project-life-cycles/
3. No swarming yet in trillion-dollar market, Investmets, 4 August 2023. https://www.investmets.com/no-swarming-yet-in-trillion-dollar-market/
4. Global autonomous mining truck population tops thousand mark, to reach 1,800 by 2025, Mining.com, 18 May 2022. https://www.mining.com/global-autonomous-mining-truck-population-tops-thousand-mark-to-reach-1800-by-2025-report/
5. https://cciwa.com/business-toolbox/growth/why-woodsides-partnership-with-nasa-is-a-win-win/

ICMM publishes Scope 3 guidance to help drive value chain emission reduction partnerships

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Today, the ICMM has published its Scope 3 Emissions Accounting and Reporting Guidance that, it says, provides a standardised framework for mining and metals companies to calculate and disclose their value chain emissions.

The guidance aims to improve transparency and accelerate collaborative action with suppliers and customers on reducing these emissions, the ICMM says. It is based on the most widely used standard for accounting and reporting corporate greenhouse gas (GHG) emissions globally – the GHG Protocol Scope 3 Standard from the World Resources Institute and World Business Council for Sustainable Development – and tailored to the unique characteristics of the mining and metals industry.

Scope 3 emissions represent 75% of the emissions profile of a company, on average – which can extend to 95% for mining and metals companies depending on their commodity portfolio, the ICMM says. As minerals and metals are the foundation of so many industries, this creates a particularly complex profile of Scope 3 emissions for the mining and metals sector, with significant variance across commodities and geographies. The guidance, the ICMM says, helps companies to understand their unique emissions profiles and identify ‘hotspots’ where they can target efforts in partnership with suppliers and customers to achieve meaningful emission reductions.

It sets clear parameters for calculating emissions across the 15 categories of Scope 3 emissions in the GHG Protocol, and supports companies in applying the protocol’s principles of Relevance, Completeness, Transparency, Accuracy and Consistency.

Rohitesh Dhawan, CEO of the ICMM, said: “The goals of the Paris Agreement depend on a massive increase in the use of low-carbon technologies and the essential minerals that enable them. But production of these materials is not without its own carbon footprint. Since all action on Scope 3 emissions depends on good quality calculations and reporting, this needs special focus for the mining and metals industry.

“ICMM members – who represent one third of the industry – have embraced their role in supporting customers and suppliers with their own efforts to decarbonise. And, while transparency and action begin with us, the urgent progress required will need collaboration at a scale we’ve never seen before. We hope that ICMM’s Scope 3 Emissions Accounting and Reporting Guidance drives partnerships that can significantly reduce value chain emissions in line with global climate goals.”

The guidance was developed with support from experts on Scope 3 from ICMM’s membership, and in consultation with investors and standard owners.

Jakob Stausholm, Chief Executive, Rio Tinto, and Chair of the ICMM Council’s Climate Change Advisory Group, said: “Climate change is the key challenge of our generation. ICMM’s Scope 3 Emissions Accounting and Reporting Guidance will help to improve the understanding of mining and metals companies’ Scope 3 emissions profiles, as well as provide opportunities to accelerate emissions reduction.

“Each company is on their own Scope 3 journey, and so the guidance recognises that a ‘one-size-fits-all’ approach does not work in the accounting and reporting of Scope 3 emissions, and that there is a need to accommodate different levels of calculation and reporting maturity across the industry. This guidance can be used by any mining operation, regardless of commodity or geography, and so we call on all companies to adopt its use in their own accounting and reporting of Scope 3 emissions to help improve alignment in disclosures across the industry.”

In 2021, ICMM members committed to reach net zero Scope 1 and 2 greenhouse gas (GHG) emissions by 2050 or sooner, in line with the ambitions of the Paris Agreement, as well as report on Scope 3 emissions by the end of 2023 and set reduction targets, if not by then, as soon as possible. Important progress has been made towards all aspects of these commitments, and members remain on track to meet their short and medium-term milestones, according to the ICMM.

Rio Tinto breaks new ground with site-by-site water use disclosure data

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Rio Tinto says it has become the first major mining company to publish site-by-site water usage data across its global network of managed sites in 35 countries, through an interactive map on its website.

The company made the announcement on World Water Day 2023.

For each managed site included, the database details permitted surface water allocation volumes, the site’s annual allocation usage and the associated catchment runoff from average annual rainfall estimate. The database includes five-year historic comparative data and will be updated annually, according to the company.

In 2019, Rio Tinto made a commitment to drive good water stewardship and improve disclosure to stakeholders, by publishing site-by-site surface water usage data for all managed sites by the end of 2023.

This commitment is in line with the water reporting guidelines of the International Council on Mining and Metals (ICMM) Water Stewardship Position Statement, which sets out ICMM members’ approach to water stewardship. It includes commitments requiring members to apply strong and transparent water governance, manage water at operations effectively and collaborate to achieve responsible and sustainable water use.

Rio Tinto Chief Executive, Jakob Stausholm, said: “Water is an essential resource, critical to sustaining biodiversity, people and economic prosperity. It is also a resource we share with the communities and nature surrounding our operations, so it is essential that we carefully manage our use and hold ourselves accountable to our stakeholders.

“This interactive database brings a new level of transparency and will enable us to engage more deeply with our stakeholders, seek their feedback on our disclosure and continue to focus our efforts on becoming better water stewards for today and future generations.”

Sharing water with communities and nature surrounding operations means balancing operational needs with those of the local communities and ecosystems, Rio says. The company aims to avoid permanent impacts on water resources by carefully managing the quality and quantity of the water used and returned to the environment.

“We will look to incorporate future water and broader environmental disclosures within this platform,” it said.

Rio Tinto and Mongolian Government ‘open’ Oyu Tolgoi Underground mine

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The Prime Minister of Mongolia, Luvsannamsrain Oyun-Erdene, today joined Rio Tinto Chief Executive, Jakob Stausholm, 1.3 km underground to celebrate the commencement of underground production from the Oyu Tolgoi copper mine in the Gobi Desert.

This was followed by a ceremony with Oyu Tolgoi employees and leaders, Government of Mongolia representatives, Oyu Tolgoi Board members and local suppliers to mark this milestone towards Oyu Tolgoi ramping up to become one of the world’s leading copper suppliers.

Since the agreement between the Government of Mongolia and Rio Tinto in January 2022 to reset the relationship and move the Oyu Tolgoi underground project forward, 30 drawbells have been blasted and copper is now being produced from the underground mine. Oyu Tolgoi is expected to become the fourth-largest copper mine in the world by 2030, operating in the first quartile of the copper equivalent cost curve, Rio Tinto says. Ore is currently being processed from Panel Zero in Hugo North Lift 1 and production will ramp up over the coming years.

A partnership between Rio Tinto and Mongolia, the Oyu Tolgoi open pit and concentrator have been succesfully operating for over a decade. The total workforce of Oyu Tolgoi is currently around 20,000 people, of which 97% are Mongolian. Oyu Tolgoi works with more than 500 national suppliers and has spent around $15 billion in Mongolia since 2010, including $4 billion of taxes, fees and other payments to the state budget, according to the mining company.

Developing the underground mine is an investment of over $7 billion, unlocking the most valuable part of the copper resource for the benefit of all stakeholders. Oyu Tolgoi is expected to produce around 500,000 t/y of copper on average from 2028 to 2036 from the open pit and underground, enough to produce around 6 million electric vehicles annually, and an average of around 290,000 t over the reserve life of around 30 years.

Oyun-Erdene said: “I am proud to celebrate this major milestone with our partner Rio Tinto as we look towards Mongolia becoming one of the world’s key copper producers. The start of underground production at Oyu Tolgoi demonstrates our ability to work together with investors in a sustainable manner and become a trusted partner. The next phase of the partnership will enable the continued successful delivery of Mongolia’s ‘New Recovery Policy’ and Vision 2050 economic diversification strategy. Mongolia stands ready to work actively and mutually beneficially with global investors and partners.”

Stausholm said: “We would like to thank the Government of Mongolia for their commitment as our partner in achieving this remarkable milestone. We are starting underground production 1.3 km beneath the remote Gobi desert from an orebody that will be critical for global copper production and Mongolia’s ongoing economic development. The copper produced in this truly world class, high technology mine will help deliver the electrification needed for a net zero future and grow Rio Tinto’s copper business.”

Rio Tinto now has a 66% interest in Oyu Tolgoi LLC, the mine operating company, following its successful completion of the acquisition of Turquoise Hill Resources Ltd; with the Government of Mongolia retaining 34%.

Mines and Money London looks at Resourcing Tomorrow

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Beacon Events has rebranded the Mines and Money London event and come up with three comprehensive tracks that, it says, covers a spectrum of critical topics around the energy transition, ESG, sustainability, circular economy, technology, services and junior mining investment.

New for 2022, Resourcing Tomorrow, brought to you by Mines and Money, is a global forum for the coming together of decision makers, mining leaders, policymakers, investors, commodity buyers, technical experts, innovators and educators for three days of learning, deal-making and unparalleled networking, the event organisers say.

With an anticipated audience of 2,000 attendees, Resourcing Tomorrow runs from November 29 to December 1, 2022, at the Business Design Exhibition Centre in London.

The three tracks – Resourcing Tomorrow, Reimagining Mining and Mines and Money – will cover 120-plus talks, panel discussions and keynote presentations from 150-plus industry experts. This includes:

  • Jakob Stausholm, Chief Executive, Rio Tinto;
  • Mark Bristow, President & Chief Executive Officer, Barrick;
  • Roy Harvey, Chief Executive Officer, Alcoa;
  • Mikael Staffas, President & Chief Executive Officer, Boliden;
  • Stuart Tonkin, Chief Executive Officer, Northern Star Resources;
  • Rohitesh Dhawan, President and Chief Executive Officer, International Council of Mining and Minerals, ICMM
  • Katy Hebditch, Head of Engagement – Technical and Sustainability, Anglo American;
  • Ellen Lenny-Pessagno, Global Vice President for Government and Community Affairs, Albemarle; and
  • Elaine Dorward-King, Non-executive Director for Sibanye Stillwater, Kenmare Resources and NovaGold.

On the third day, the Mines and Money Outstanding Achievement Awards will take place at the Bloomsbury Big Top to celebrate the very best of the industry through awards from exploration to deal making, from innovation in technology to CEOs who have made a difference, these awards recognise and reward excellence.

International Mining is a media sponsor of the Resourcing Tomorrow event

Rio, TRQ and Mongolia agree on Oyu Tolgoi Underground development path

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Rio Tinto, Turquoise Hill Resources (TRQ) and the Government of Mongolia have reached an agreement that, Rio says, will move the Oyu Tolgoi (OT) project forward, resetting the relationship between the partners and increasing the value the project delivers for Mongolia.

As a result, the OT Board, comprised of representatives of Rio Tinto, TRQ and Erdenes Oyu Tolgoi (EOT), the latter of which is wholly owned by the Government of Mongolia, has unanimously approved commencement of underground operations. This step unlocks the most valuable part of the mine and is expected to begin in the coming days, with first sustainable production expected in the first half of 2023, according to Rio Tinto.

As part of a comprehensive package, TRQ will waive the $2.4 billion EOT carry account loan in full, comprising the amount of common share investments in OT LLC funded by TRQ on behalf of EOT to build the project to date, plus accrued interest.

The Parliament of Mongolia has approved a resolution (Resolution 103) that resolves the outstanding issues that have been subject to negotiations with the Government of Mongolia over the last two years in relation to addressing Parliament Resolution 92 (December 2019).

With this approval, the Parliament of Mongolia has required that certain measures be completed in order for Resolution 92 to be considered formally implemented. Among the measures already addressed are improved cooperation with EOT, implementation of measures to monitor OT underground development financing mechanisms and enhance ESG matters and the approval of the Electricity Supply Agreement.

Rio says it is continuing to work with the Government of Mongolia and TRQ to finalise the remaining outstanding measures of Resolution 92, namely the formal termination of the Oyu Tolgoi Mine Development and Financing Plan (UDP) and resolution of the outstanding OT LLC tax arbitration.

An updated funding plan has been agreed to address TRQ’s current estimated remaining funding requirement for the OT Underground Project. Until sustainable underground production is achieved, OT will be funded by cash on hand and rescheduling of existing debt repayments, together with a pre-paid copper concentrate sales agreement with TRQ. This is in line with restrictions on debt financing contained in Resolution 103, passed on December 30, 2021.

Rio Tinto and TRQ have amended the Heads of Agreement signed in April 2021 to ensure they appropriately fund OT. The capital forecast for the project is $6.925 billion, including $175 million of known COVID-19 impacts to the end of 2021. Forecasted remaining underground capital expenditure is approximately $1.8 billion. A reforecast will be undertaken during the first half of this year to determine a revised cost and schedule estimate that will reflect:

  • Any further COVID-19 impacts;
  • Any additional time-based impacts and market price escalation arising from resequencing due to 2021 budget constraints (as a result of the OT Board not approving the capital budget uplift at the time the Definitive Estimate was finalised); and
  • Updated risk ranging reflecting the latest project execution risks.

The key elements under the amended Heads of Agreement include:

  • Pursuing the rescheduling of principal repayments of existing OT project finance to potentially reduce the OT funding requirement by up to $1.7 billion;
  • Seeking to raise up to $500 million of senior supplemental debt at OT from selected international financial institutions which could be put in place after sustainable underground production is achieved;
  • Rio Tinto providing a co-lending project finance facility to OT of up to $750 million to be made available after sustainable underground production is achieved (with up to $300 million of such amount being available under a short-term secured advance directly to TRQ pending such co-lending); and
  • TRQ agreeing to conduct equity or rights offerings of up to $1.5 billion (with an initial offering of at least $650 million by no later than August 31, 2022).

The re-profiling of the existing OT project finance and any additional senior supplemental debt at OT will be subject to availability and terms and conditions being acceptable to Rio Tinto and TRQ, according to the company.

The OT Board has also approved the signing of an Electricity Supply Agreement to provide OT with a long-term source of power from the Mongolian grid, under terms already agreed with the Government of Mongolia. In meeting OT’s commitment to sourcing power domestically, Rio Tinto will work with the Government to support long-term renewable energy generation in support of the Mongolian grid. The Government of Mongolia and OT are in constructive discussions with the Inner Mongolia Power International Cooperation Company (IMPIC) for an extension of current power import arrangements beyond the current agreement of July 2023. IMPIC has indicated its support for an extension and commercial terms are being finalised.

Luvsannamsrain Oyun-Erdene, the Prime Minister of Mongolia, said: “The commencement of Oyu Tolgoi underground mining operations demonstrates to the world that Mongolia can work together with investors in a sustainable manner and become a trusted partner. As part of our ‘New Recovery Policy’, I am happy to express Mongolia’s readiness to work actively and mutually beneficially with global investors and partners.”

Rio Tinto Chief Executive, Jakob Stausholm, said: “We would like to thank the Government of Mongolia for their commitment to working productively with Rio Tinto and TRQ to reach this crucial agreement that will see one of the world’s largest copper growth projects move forward and firmly establish Mongolia as a global investment destination. This agreement represents a reset of our relationship and resolves historical issues between the OT project partners. We strongly believe in the future of this country and I am personally committed to ensuring that the people of Mongolia benefit strongly from OT along with our shareholders.

“I have visited Mongolia twice in the last few months and I cannot help but be proud of what has been achieved by our workforce, hand-in-hand with communities, suppliers and other partners. I would like to thank the many thousands of people involved for what they have achieved.

“The OT underground development will consolidate Rio Tinto’s position as a leading global supplier of copper at a time when demand is increasing, driven by its role in enabling decarbonisation and electrification in the race to net zero. We will also explore additional opportunities to decarbonise the OT operations, including sourcing renewable power.”

Steve Thibeault, Interim Chief Executive Officer of Turquoise Hill Resources, added: “Today is a landmark day for Turquoise Hill and a major milestone in the development of the Oyu Tolgoi underground development project. We are very excited to be starting work on the undercut, which is critical to unlocking the immense potential of this world-class, high-grade deposit for the benefit of all stakeholders. Following the agreements with the Government of Mongolia and the Amended Heads of Agreement with Rio Tinto being put in place, we now have greater certainty and confidence to complete construction of this once-in-a-generation mine that, when finished, is expected to be one of the largest copper producing mines in the world and a generator of vast economic value and employment in Mongolia and of returns for our shareholders for years to come. I want to thank the Government of Mongolia for its commitment to securing a balanced agreement that helps to advance the project while ensuring that all stakeholders including the people of Mongolia truly benefit from the development of this resource. This agreement says a lot about the positive environment for foreign investment in the country.”

By 2030 OT is expected to be the fourth largest copper mine in the world. It is a complex greenfield project comprising an underground block cave mine and copper concentrator as well as an open-pit mine which has been successfully operating for almost 10 years. It is also one of the most modern, safe, sustainable and water-efficient operations globally, with a workforce which is more than 96% Mongolian. Since 2010, OT has spent a total of $13.4 billion in-country, including $3.6 billion of taxes, fees and other payments to the state budget. The size and quality of this Tier 1 asset provides additional expansion options, which could see production sustained for many decades.

At peak production, OT is expected to produce around 500,000 t/y of copper on average from 2028 to 2036 from the open pit and underground, and an average of around 350,000 t for a further five years, compared with 163,000 t in 2021. The underground Ore Reserve has an average copper grade of 1.52%, which is more than three times higher than the open pit reserve, and contains 0.31 g/t Au.

Rio makes Rincon lithium play as part of portfolio decarbonisation plan

Energy minerals, Mineral exploration, Mineral processing, Mineral project development, Mining mergers and acquisitions, Sustainable mining, Water management, , , , , , ,

Rio Tinto has entered into a binding agreement to acquire the Rincon lithium project in Argentina, an undeveloped brine project that, Rio says, has the potential to have one of the lowest carbon footprints in the industry and can help deliver on the company’s commitment to decarbonise its portfolio.

The agreement has been signed with Rincon Mining, a company owned by funds managed by the private equity group Sentient Equity Partners, for $825 million.

Rincon is in the heart of the lithium triangle in the Salta Province of Argentina, an emerging hub for greenfield projects. The project is a long life, scaleable resource capable of producing battery-grade lithium carbonate, according to Rio. The direct lithium extraction technology proposed for the project has the potential to significantly increase lithium recoveries as compared with solar evaporation ponds, according to the company. This process uses a resin to adsorb the lithium, with clean water used to wash off the lithium in desorption, and adsorption and desorption conducted with raw brine and water at ambient temperature to significantly reduce the energy consumption, Rincon says.

A pilot plant is currently running at the site and further work will focus on continuing to optimise the process and recoveries.

Rio Tinto Chief Executive, Jakob Stausholm, said: “This acquisition is strongly aligned with our strategy to prioritise growth capital in commodities that support decarbonisation and to continue to deliver attractive returns to shareholders. The Rincon project holds the potential to deliver a significant new supply of battery-grade lithium carbonate, to capture the opportunity offered by the rising demand driven by the global energy transition. It is expected to be a long life, low-cost asset that will continue to build the strength of our Battery Materials portfolio, with our combined lithium assets spanning the US, Europe and South America.”

Once acquired by Rio Tinto, the Rincon project will be subject to the completion of studies to confirm the resource and define an JORC Code compliant resource statement. Work will be undertaken to determine the development strategy and timing, secure updates to existing Environmental Impact Assessment permits to allow development and production, and undertake ongoing engagement with communities, the province of Salta and the Government of Argentina, the company said.

As the project is currently held through an Argentine branch of an Australian company, completion of the transaction is conditional upon approval by Australia’s Foreign Investment Review Board (FIRB). Subject to this FIRB approval, the transaction is expected to be completed in the first half of 2022.

Rio Tinto investigates Heliogen’s AI-backed solar technology to decarbonise Boron ops

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Rio Tinto and renewable energy technology company, Heliogen, have announced an agreement to explore the deployment of Heliogen’s solar technology at Rio Tinto’s borates mine in Boron, California.

Under a memorandum of understanding, Heliogen will deploy its proprietary, artificial intelligence (AI)-powered technology at the Boron operation, where it will use heat from the sun to generate and store carbon-free energy to power the mine’s industrial processes.

The two companies will begin detailed planning and securing government permits for the project, with the aim of starting operations from 2022. They will also use the Boron installation to begin exploring the potential for deployments of Heliogen’s technology at Rio Tinto’s other operations around the world to supply process heat, which accounted for 14% of Scope 1 & 2 emissions from the group’s managed operations in 2020.

Heliogen’s high-temperature solar technology is designed to cost-effectively replace fossil fuels with sunlight for a range of industrial processes, including those used in mining. At Rio Tinto’s Boron mine, the company’s proprietary technology will use AI to control a network of mirrors that concentrate sunlight to capture energy used to make steam, the companies said. Heliogen’s system will also store the captured energy in the form of heat, allowing it to power night-time operations and provide the same uninterrupted energy stream offered by legacy fuels.

The Boron operation mines and refines borates into products ranging from fertilisers to construction materials and is producing lithium carbonate from a demonstration plant. The site currently generates steam using a natural gas co-generation plant and natural gas fired boilers. Heliogen’s installation will supplement these energy sources by generating up to 35,000 pounds per hour (15.9 t/h) of steam to power operations, with the potential to reduce carbon emissions at the Boron site by around 7% – equivalent to taking more than 5,000 cars off the road. Rio Tinto will also be assessing the potential for larger scale use of the Heliogen technology at Boron to reduce the site’s carbon footprint by up to 24%.

Heliogen’s mission of slashing global carbon emissions by replacing fossil fuels with sunlight, as well as its focus on industrial sectors, made it an ideal partner for Rio Tinto, which is committed to decarbonising its global operations, it said.

Rio Tinto Chief Executive, Jakob Stausholm, said: “This partnership with Heliogen has the potential to significantly reduce our emissions at Boron by using this ground-breaking solar technology, and we look forward to exploring opportunities across our global portfolio.

“Addressing climate change effectively will require businesses, governments and society to work together through partnerships like this one, to explore innovative new solutions throughout the entire value chain. Our work with Heliogen is part of Rio Tinto’s commitment to spend approximately $1 billion on emissions reduction initiatives through to 2025 and our commitment to work with world-leading technology providers to achieve this goal.”

Heliogen CEO and Founder, Bill Gross, said: “Since its founding, Heliogen has been laser-focused on decarbonising industrial sectors, including mining. As a result, this agreement with Rio Tinto is incredibly gratifying.

“We’re pleased to find a partner committed to cutting its contributions to climate change. We’re also pleased that Rio Tinto is exploring our technology to play an important role in helping reach its sustainability goals while dramatically reducing its energy costs. More broadly, we’re excited to take this important step as we pursue Heliogen’s goal of avoiding more than 1 gigaton of CO2 emissions – 5% of the world’s annual total – from the global economy by turning sunlight into an industrial energy source.”