Tag Archives: LNG

Strandline, Woodside and EDL to work on ‘world-first’ power project for Coburn

Strandline Resources has selected Woodside and EDL to provide a fully integrated energy solution for its Coburn mineral sands project, in Western Australia.

The parties have signed a non-binding proposal for the development of a 27 MW integrated trucked LNG, storage and power station facility, comprising gas and diesel back-up generators combined with state-of-the-art solar and battery technology, it said.

The Woodside and EDL joint venture (WEJV) was formed to provide clean, reliable and affordable LNG to market, according to Strandline.

“This world-first trucked LNG to hybrid renewable microgrid project will see EDL bring its turnkey expertise to the project’s power station and LNG storage and re-gasification facilities, with LNG supplied from Woodside’s Pluto LNG truck loading facility near Karratha, Western Australia,” Strandline said.

It is expected that contract documentation, in the form of a 15-year power purchase agreement, will be finalised over the coming months in readiness for the commencement of construction, Strandline said.

The WEJV solution provides Strandline with a long-term safe, reliable and highly efficient energy solution for Coburn, according to the developer.

EDL was recently involved in the start up of phase one of a hybrid power project at Gold Fields’ Agnew gold mine, also in Western Australia (pictured).

Coburn, meanwhile, is a mineral sands deposit hosting “exceptional” zircon and titanium mineral sands products, Strandline says. The project benefits from being situated in the well-established mining jurisdiction of Western Australia, close to key road, port and services infrastructure.

The company recently completed a definitive feasibility study on Coburn, which showed the project could generate a pre-tax net present value of A$551 million ($377 million) using a US$:A$ of 0.72, an 8% discount rate, and development capital of A$207 million for the heavy mineral concentrate produce case, with an additional A$50 million required for the final products case (including mineral separation plant infrastructure).

BHP looks to LNG for lower iron ore shipping emissions

BHP, as part of its goal to reduce greenhouse gas emissions across its operations, has released the world’s first bulk carrier tender for LNG-fuelled transport for up to 27 Mt of its iron ore.

The company said: “Introducing LNG-fuelled ships into BHP’s maritime supply chain will eliminate nitrogen oxide (NOx) and sulphur oxide (SOx) emissions and significantly reduce CO2 emissions along the busiest bulk transport route globally.”

BHP, as part of its greenhouse gas emission reduction plans, recently signed a memorandum of understanding with Mitsubishi Development to work together in the pursuit of emissions reductions, including from the life-cycle use of marketed products.

Rashpal Bhatti, Vice President, Maritime and Supply Chain Excellence, BHP, said emissions resulting from the transportation and distribution of the company’s products represented a material source of its value chain emissions (Scope 3).

“We recognise we have a stewardship role, working with our customers, suppliers and others to influence emissions reductions across the full life cycle of our products,” Bhatti said. “Through this tender, we are seeking potential partners who share our ambition of lowering emissions to the maritime supply chain.”

The tender is open to a select group of industry leaders, from ship owners, banks and LNG fuel network providers, BHP said. “As well as LNG-fuelled transport for up to 10% of its iron ore, the tender seeks other innovative solutions that can lower greenhouse gas emissions and increase productivity from BHP’s freight requirements.”

Bhatti added: “We are fully supportive of the International Maritime Organisation’s (IMO) decision to impose lower limits on sulphur levels in marine fuels.

“While LNG may not be the sustainable homogenous fuel of choice for a zero carbon future, we are not prepared to wait for a 100% compliant solution if we know that, together with our partners, we can make significant progress now.

“This new tender adds to the work BHP is doing with customers, suppliers and parties along our value chain to influence emissions reductions from the transport and use of our products.”

The IMO ruled from January 1, 2020, that the marine sector will have to reduce sulphur emissions by over 80% by switching to lower sulphur fuels, with the current maximum fuel oil sulphur limit of 3.5 weight percent (wt%) falling to 0.5 wt%.

As well as investments in emerging technologies, BHP sets greenhouse gas emissions reduction targets for its operations, builds the resilience of its operations and communities to the physical impacts of climate change, and works across sectors to strengthen the global policy and market response, the company said.

Adaman’s Kirklalocka gold project to be powered by LNG

Adaman Resources’ owned Kirkalocka gold project, in Western Australia, is set to be powered by LNG after the asset owner and EVOL LNG signed a agreement.

The long-term arrangement, between EVOL and Adaman Resources’ wholly-owned subsidiary Kirkalocka Gold SPV Pty Ltd, will see EVOL LNG fuel Zenith Energy’s 14.5 MW power station, with supply planned to commence from September 2019.

The gold mine, around 70 km south of Mt Magnet in the mid-west region of Western Australia, is set to restart operation after more than a decade, with the mine’s new owners refurbishing the processing plant and increasing its capacity to over 2.2 Mt/y.

EVOL LNG and Wholesale Manager, Nick Rea, said the use of LNG as an alternative to diesel will help minimise the mine’s carbon emissions.

“LNG produces 25% less CO2 emissions than diesel, and during the initial six years of operation, the mine will avoid 50,000 t of greenhouse gas emissions by fuelling its power station with LNG instead of diesel. This is the equivalent of keeping around 3,000 cars off the road,” Rea said.

EVOL, part of Wesfarmers Chemicals, Energy & Fertilisers, will build, own, operate and maintain the on-site LNG storage and vaporisation facility at the mine, it said. “The facility will use EVOL LNG’s modular design which allows for fast installation and expandability to suit the mine’s growing energy requirements,” the company added.

Adaman Resources’ Chief Executive Officer, Craig Bradshaw, said EVOL LNG will provide environmental, financial and economic benefits for the company.

“Utilising LNG as an alternative to diesel-fired generation will significantly reduce our energy costs and exposure to volatile diesel prices. Based on the current diesel price, we estimate our energy costs to be reduced by more than A$13 million ($9 million) during the first six years of operation,” he said.

EVOL’s Rea said Kirkalocka was the company’s third major contract in the mid-west in recent years; he sees huge potential for growth in this region.

“The scarcity of gas pipelines and absence of grid power would otherwise force off-grid mines to use diesel for power generation, but we are able to provide a much better solution with LNG. It’s clean, safe, reliable and lower cost than diesel.

“We have proven ourselves to the mining industry over the last decade, with seven mine sites now powered by EVOL LNG,” he said.

Cat’s DGB dual-fuel technology cuts costs, emissions at La Herradura gold mine

Caterpillar has been showing one of Mexico’s biggest gold mining operations that its Dynamic Gas Blending™ (DGB) technology can provide savings on fuel costs and emissions while maintaining the same performance, payload and productivity of its diesel haul trucks.

The mining OEM and its Mexico-based dealer, Matco Cat, have been working with Fresnillo’s Penmont division to convert its entire fleet of large mining trucks at the La Herradura open-pit mine, in Sonora.

Caterpillar’s dual-fuel DGB technology, which has accumulated 10 million hours in the oil and gas industry since 2013, works by blending lower cost liquefied natural gas (LNG) with diesel fuel, according to Cat.

The resultant improvements in fuel, emissions and maintenance can add up to millions of dollars each year in cost savings, Cat said.

La Herradura, since 2016, has acted as a great case study for the technology given it has more than 250 Cat trucks and the operation hauls at least 25 Mt of volume per quarter (based on Fresnillo’s most recent Q4 production results).

In addition, the company has been looking for ways to “produce (gold) in a sustainable manner”, Fresnillo’s Abel Villa said in a recent Cat customer story.

According to Steve Igoe, Commercial Manager for Caterpillar’s Gas Engine Business, the benefits of DGB technology include, primarily, a lower cost per tonne, realised through a lower fuel cost. “DGB truck operation with LNG has proven very beneficial to La Herradura, and this is why they have decided to convert their entire fleet,” he said.

“Typically, LNG is 30% lower than the price of diesel. And, on a typical fleet at a mine, that adds up to millions of dollars a year,” he said. “And the trucks maintain the ability to operate 100% on diesel.”

Cat estimates a fleet of 100 trucks spends approximately $60-70 million/y on diesel fuel. With 65% displacement to LNG using DGB, that fleet could save $13 million/y on fuel alone.

DGB can also bring about a 30% cut in emissions compared with diesel-only operation – another important saving for mining companies looking at sustainability.

Trials during 2016 and 2017 of the technology at a gold mine in Turkey and a phosphate mine in the US have proven these claims.

For instance, the Turkey gold mine has retrofitted DGB technology on Cat 150-ton (136-t) 785C haul trucks and, since installation, has reached an average 70% average fuel displacement in addition to an operating cost reduction of $30/h.

Fresnillo’s Villa said La Herradura had gone further than this in terms of displacement.

“Initially when we started the project, the substitution rate was 70:30. We evaluated the results and changed the substitution to 85:15,” he said. This is close to the peak substitution rate Cat typically recommends.

Villa continued: “We have an average reduction of 70% in diesel consumption. We also considerably reduced the amount of emissions. When we compare both diesel and gas, the operation is the same.”

Cat said it observed a less than 1% difference in speed, payload and gear shifting, plus a 30% reduction in fuel cost, during one customer’s 5,000-h DGB trial.

La Herradura has also seen no unexpected maintenance issues during the trials, according to Fresnillo’s Enrique Leal. This is in keeping with Cat’s focus on reliability and productivity, with the company saying it has tallied zero hours of unplanned downtime.

So far, La Herradura has retrofitted 31 of its 785C haul trucks and a significant number of 240-ton (218-t) 793D trucks with the DGB technology.

Fresnillo’s Villa said the operation also plans to partner with a third party to build an LNG plant near the mine to ensure a sustainable supply.

MES off to fast start with dual fuel haul truck engine conversion tech

Mine Energy Solutions (MES) is building on the recent dual fuel hybrid truck trial it ran with project partners New Hope Group and Hastings Deering at the New Acland coal mine in Queensland, Australia, and hopes to roll out its first commercial fleet at an operation in the state’s Bowen Basin late next year.

The trial on a Cat 789C haul truck took place over the past two years at New Acland and involved the conversion of high horse powered diesel engines from 100% diesel to dual fuel operation, using natural gas as the dominant fuel through sequential gas injection.

MES’ Graham Box provided IM with some more insight into the High Density Compressed Natural Gas (HDCNG®) technology, owned and developed by MES shareholder Intelligas, and the company’s business model.

Mr Box said MES, which doesn’t sell a product or a kit but a “fully-funded energy proposition”, uses bespoke designs for each truck model conversion it works on.

The incorporation of Type 4 carbon fibre cylinders to store the gas – which is compressed and stored at 350 bar (5,000 psi) using patented technology – is one of the ways the company has got around the weight and space constraints that previously limited technology using compressed natural gas and LNG on truck engines.

A lightweight non-invasive engine augmentation and on-board control system also help alleviate this issue, according to Mr Box.

“Remember, our gas remains in a gaseous state and is not liquefied,” he added.

The haul truck fuel conversion packs use HDCNG® proprietary gas cylinder filling technology to achieve energy densities approximately double that of conventional compressed natural gas storage systems and approaching two thirds of the density of LNG without the operational complexity and cost of LNG cryogenic storage and handling, according to MES.

“This enables mine trucks to achieve high levels of diesel displacement whilst carrying sufficient fuel on board for a full work shift and not adversely affecting payload,” the company said.

The system has been developed to achieve sufficient fuel storage quantities on board the machine for a full work shift of up to 12 hours. In mine haul trucks, a slim-line diesel fuel tank (and if required a slim-line hydraulic oil tank) replaces the existing tanks allowing for the introduction of HDCNG® fuel packs for the storage of gas on the machine.

The trial at New Acland took place on a Cat 3516B engine, yet Mr Box said the company is “well advanced” or has “completed development work” on a number of other OEMs and models.

“Our first commercial conversions will be on either a Liebherr or Komatsu mine haul truck,” he said. “We are targeting large trucks/engines, with the 789C, or equivalent, the smallest we will do.”

In addition to preparing for its first commercial fleet agreement late next year, Mr Box said deliveries are expected in the US and Western Australia’s Pilbara region in the following two years.

This is just for starters, with qualified opportunities in Canada, South America, India, Russia, South Africa, Ghana, Tanzania, Indonesia and Mexico, according to Mr Box.

“The best testament for us is feedback from mining companies who have been searching for the type of technology we have developed,” he said.

“We have been told by some of the world’s largest miners that there is clear daylight between our technology and anything else out there, including from the OEMs. It has been MES’ choice to position our commercial pathway in a targeted and controlled fashion and we are working closely and collaboratively with our pathfinder customers and these other mining companies.”

Newmont Mining still weighing up LNG/diesel dual-fuel options

The use of LNG in the engines of mining haul trucks has been gaining serious traction of late with OEMs and mining companies, alike, considering dual-fuel options.

Newmont Mining stated in its 2017 sustainability report, released back in April, that it and Caterpillar were looking at such a project as part of the US-based mining company’s attempt to decrease its greenhouse gas (GHG) emissions.

The company believes the advancement of dual-fuel engines on haul trucks could displace, on average, 65% of diesel fuel with LNG.

A Newmont spokesman told IM this week that the company is still in the process of evaluating an LNG option and, at some point, it may “take the next step towards a meaningful pilot project”.

Teck Resources carried out such a trial at its Fording River coal operations in British Columbia, Canada.

The pilot test, which used a hybrid LNG/diesel fuel system in six haul trucks and concluded in December 2016, provided many valuable learnings to Teck, including “utilising LNG safely and integrating new technologies at our operations”, Greg Brouwer, General Manager, Technology and Innovation, recently told IM.

“While the particular LNG technology used in this pilot did not achieve the targeted emission reduction benefits, we remain committed to exploring the use of LNG as a haul truck fuel source to reduce GHG emissions and costs and we are currently assessing other technologies,” he said. (You can read more about Teck’s latest innovations in the upcoming IM October issue)

Just last month, GFS Corp reported increased interest in its EVO-MT® System for off-highway machinery. Much of this renewed interest is coming from the mining sector where the company’s products allow haul trucks, wheel loaders and drill rigs to operate on a combination of diesel and LNG or NG+D® as the company refers to it, GFS said.