Tag Archives: mine contractor

Mastermyne gets three more years at Moranbah North, Grosvenor

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

Mastermyne Group has had its Moranbah Region Umbrella contract with Anglo American’s Metallurgical Coal division renewed for a three-year term, it said.

The contract extends the existing contract at Moranbah North and Grosvenor mines, in Queensland, Australia, and commences from November 15.

Mastermyne said the pact includes an option to extend for an additional two years at Anglo American’s discretion, with work under this contract estimated to contribute revenues of around A$250-$300 million ($170-204 million) over the three-year term.

The scope of work includes design, supply and installation, recovery and maintenance of ventilation structures and devices; installation of secondary support; outbye support and maintenance activities; conveyor belt installations and recovery; and development services.

Moranbah North is an underground longwall coking coal mine that began operating in 1998, while Grosvenor, also a longwall coking coal mine, produced its first longwall coal in May 2016.
Mastermyne said the revenue and earnings from the contract extension have been included in the company’s current 2020 financial year guidance.

Mastermyne CEO, Tony Caruso, said: “The company is very pleased to see the continuation of this long-term relationship, built with Anglo American over the past 17 years. Moranbah North and Grosvenor mines supply high-grade metallurgical coal to the international market for steel production, and we are pleased to support their successful operation.”

Aus Tin chooses different tack at Taronga Stage 1 project

Comminution of minerals, Mine operation news, Mineral processing, Mineral project development, Mining equipment, Mining services, Precious metals, , , , , , , ,

There are changes afoot at Aus Tin Mining’s Taronga Stage 1 project, in Australia, after the ASX-listed company appointed a contractor for an initial program of mining, crushing and civil works, and made the decision to acquire its own crushing plant.

The company said it had appointed Townes Contracting, a firm with experience in quarrying and crushing operations, to undertake the initial mining, crushing and civil works associated with Taronga Stage 1. Expected to last three months, this contract should provide for site establishment, initial mining of some 50,000 t of ore and waste, crushing of ore and construction of a water dam, Aus Tin said.

Aus Tin’s decision to acquire its own crushing plant, meanwhile, follows a crushing trial completed with a preferred contractor in May. Aus Tin explained: “The company was unable to secure their services in a timeframe consistent with operational requirements.”

The Taronga tin project is the world’s fifth largest undeveloped tin reserve, based on a JORC resource of 57,200 t of contained tin, plus 26,400 t of contained copper and 4.4 Moz of silver, Aus Tin says.

The company completed a prefeasibility study in 2014 that outlined a project treating 2.5 Mt/y of ore, producing an average 2,800 t/y of contained tin over nine years. Following this, in 2015, the company commenced the approvals process to undertake trial mining and pilot processing of 340,000 t of ore to evaluate several areas of potential upside. This project – Taronga Stage 1 – is now fully permitted.

Peter Williams, CEO of Aus Tin, said: “Now that we are no longer constrained in any way by contractors at Granville, we have decided to take a different approach to the operation and believe this will provide the optimal means to exploit this small, but high grade tin deposit.”

Back in March, Aus Tin Mining 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.

Aus Tin said the initial programme of work to be carried out by Townes Contracting will provide “several important outcomes”. Included within this is a provisional metal reconciliation, with the average grade of ore mined compared with the respective mining blocks estimated in the 2014 probable reserve; productivity and cost data to optimise pricing for the remainder of Stage 1, and; material for additional metallurgical test work planned prior to the commencement of Stage 1 pilot plant operations.

The remainder of the Stage 1 project, including the expanded mine and pilot plant operations are expected to commence in late 2019.

In terms of the crusher Aus Tin is due to acquire, the company said it had made an initial payment on a second-hand mobile crushing plant, located in Tasmania, and refurbishment of the unit – expected to take three to four weeks – had commenced.

“The key benefits of owner crushing will be a lower operating cost and ability to crush ore on an ongoing basis rather than the campaign basis required for contractors,” Aus Tin said.

Quartile One helping Emeco improve equipment fleet reliability

Coal technology, Equipment maintenance, IoT, Mining consumables, Mining equipment, Mining maintenance, Mining services, Steel and iron ore, , , , , ,

In its 2019 financial year update presentation, contractor Emeco Holdings flagged up a partnership with Quartile One that has seen the company improve the component life and reliability of its expanding equipment fleet.

The contractor has grown in recent years, adding, in 2018, rental specialist Matilda Equipment to the portfolio. It also recently bolstered its fleet with “strategic core assets” comprising mainly 240-t haul trucks and Cat D10/D11 dozers.

This has seen the company’s focus on Australia coking coal operations increase to around two-thirds of the overall business, with the remainder coming from Australia thermal coal.

The reliability of its fleet, which it characterises as young compared with the average across the industry, is crucial to its overall success in winning and retaining mining business.

During the update today, Emeco said it maximises component life within its fleet through centralised planning and a reliability engineering ability to rebuild components in house. Much of this is enabled by an asset management solution from Quartile One.

Quartile One, which is expected to be acquired by Aurecon next month after a deal was announced in April, is a key player in the data analytics space, helping companies manage physical and other infrastructure assets to meet “the performance and pricing challenges of the commodity markets”, Aurecon said.

According to Emeco, the Quartile One industry database contains 85,000 years of mobile equipment industry comparisons with assets on 150 sites globally. This enables benchmarking with best practice owners globally to drive improved performance alongside a valuable reference for optimised decision making.

Emeco said Quartile One’s “reliability engineers” monitor the performance of all components on its equipment fleet for signs of distress or abuse, while advanced financial and engineering analytics ensure data-driven decisions. This is backed up by asset telemetry, which provides real-time data on components.

Meanwhile, a central planning function accounts for component change out 12 months in advance, enabling the company to streamline maintenance ahead of time. Artificial intelligence tools are also in the mix, which support inventory optimisation, according to Emeco.

All of this adds up to a reduction in downtime, improvement in availability and reliability, visibility on major expenditure forecasts and plans, security of parts supply & lowest life cycle cost position, according to Emeco.

Clough to provide key infrastructure at Rio’s Koodaideri iron ore project

Automation, Mineral project development, Mining equipment, Mining services, Steel and iron ore, , , , , , , , , , ,

Clough, as part as the Acciona Clough joint venture, has been awarded a civil works contract for the construction of the northern rail formation for the Rio Tinto Koodaideri iron ore project, in Western Australia.

Clough CEO and Managing Director, Peter Bennett, said: “We are excited with the opportunity to work with Rio Tinto Iron Ore to deliver its vision for the Koodaideri project as we continue to grow our presence in Western Australia’s iron ore developments.”

Bennett said the execution of the contract would create more than 200 new jobs, with the scope including 100 km of rail formation earthworks, culverts, bridge construction, access roads and level crossings.

“Clough is a proudly Western Australian engineering and construction company with a proven history of delivering world-class projects with outstanding safety and quality results in Australia and overseas,” he added.

The engineering and construction company is celebrating its 100th year of operation.

The Koodaideri project is a greenfield mine development for Rio Tinto Iron Ore, in the East Pilbara mining region. The mine will initially be developed with an annual capacity of 43 Mt. To allow the transportation of iron ore product to either Dampier or Cape Lambert, the project requires a 170 km rail spur to connect the Koodaideri mine to the existing Rio Tinto Iron Ore rail network, just south of Lyre Siding at Numbat.

WorleyParsons is carrying out the EPCM contract for the project, while FLSmidth said this week that it will bring the latest 3D smart design to the development.

The project has been designed to use an increased level of automation and digitisation, helping to deliver a safer and more productive mine, which is expected to be Rio Tinto’s lowest cost contributor to its industry benchmark Pilbara Blend product.

Exxaro cuts Group Five ties as contractor goes into business rescue proceedings

Coal technology, Mine operation news, Mining services, Power supply for mines, , , , , , , ,

Exxaro has taken the decision to terminate its agreement with Group Five Construction subsidiary, Group Five Projects, following Group 5’s announcement that it has embarked on business rescue proceedings.

Johan Meyer, Executive Head, Projects & Technology, said: “It is indeed a sad day as more than 750 contract workers will be impacted by this decision.”

Exxaro appointed Group 5 Projects on April 3, 2017, to construct a new small coal plant as part of the Grootegeluk Plant 6 (GG6) expansion project at its Grootegeluk mine near Lephalale, in Limpopo, South Africa. Barring unforeseen incidents, the Group 5 Projects scope was due to be completed at the end of May.

“The decision will regrettably now result in a delay to project,” Exxaro said.

“Exxaro has notified Group 5 of its decision and has embarked on discussions to mitigate the business impacts arising from this very sad situation. In the meantime, however, Group 5 Projects workers and subcontractors have moved off-site.”

Exxaro is engaging with its labour support (both legal and human resources) to maintain stability on site.

Grootegeluk is a critical source of A-grade, export-quality coal and power station coal that fuels Eskom’s Medupi and Matimba power stations. The site has an estimated life of mine of 45 years, producing 17 Mt/y.

The ZAR4.8 billion ($332 million) expansion of GG6 will ensure increased throughput and enhanced processing efficiencies to ramp up export coal production at this important site, Exxaro said.

The new GG6 plant will enable an additional 600 t/h of throughput on the run of mine feed, as well as higher, more valuable yields through enhanced operational efficiencies and better beneficiation processes.

Technical alterations at the plant consist of a new small coal beneficiation plant (SCP), enabling the processing of fragments of less than 10 mm, improving fines plant beneficiation processes through the use of reflux classifier technology, a dewatering plant and ancillaries and expansion of the current stockyard.

A new double-stage, dense medium separation plant will be established to process and prepare the export coal. The plant will also include a fines beneficiation Reflux Classifier circuit and dewatering section. The existing GG6 stockyard will be upgraded and expanded to accommodate additional product volumes.

Nordic Gold cuts ties with Tallqvist Oy, puts Laiva on care and maintenance

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

Nordic Gold has terminated its agreement with mining contractor Tallqvist Oy and decided to place the Laiva gold mine, in Finland, on care and maintenance, months after pouring first gold.

The contractor decision follows continued underperformance, resulting in a shortfall in tonnes and grade to the mill, Nordic Gold said. “Despite written warnings, only slight improvements have been made and the contract with the current mining contractor has now been terminated in order to reduce the outflow of cash,” the company said.

To further conserve cash, the Laiva mine will be placed on care and maintenance while an alternative contractor is engaged and additional financing is found, Nordic Gold said. Care and maintenance is expected to last for around three to four months, according to the company.

Nordic Gold said: “The process of engaging another contractor has begun. A scope of work has been issued and several competitively priced proposals have been received.”

Jett Capital Advisors, of New York, has been engaged to help Nordic secure $35 million in debt financing. This money will be used to restart the mine and mill and replace its current lender, according to the company. The company is currently in discussion with several parties interested in providing this capital.

In addition to replacing the current lender, these funds will provide working capital for ongoing operations and provide funds for drilling to expand the resource.

Since the first gold pour on November 30, Laiva has produced 6,920 oz of gold and received $8.8 million from gold sales.

Thiess to help expand operations at Bayan’s Melak coal mine in Indonesia

Bulk handling, Coal technology, Explosives and blasting, Mine operation news, Mining equipment, Mining services, Power supply for mines, , , , , , ,

CIMIC Group subsidiary, Thiess, says it has secured a A$172 million ($121 million) contract extension from Bayan Resources to expand operations at the Melak coal mine in East Kalimantan, Indonesia.

Under the 12-month extension, which takes the contract out to 2023, Thiess will increase coal production and overburden removal and continue to provide additional mining services, including drill and blast, and coal loading to the barge facility, it said.

CIMIC Group Mining and Minerals Executive and Thiess Managing Director, Douglas Thompson, said: “I’m pleased to be continuing our relationship with Bayan Resources and extending our operations at Melak where our team has delivered exceptional technical solutions for almost 10 years.”

In 2008, Thiess was awarded a contract to develop and operate the Melak greenfield coal mine. The mine is divided into the two different mine concessions, Teguh Sinar Abadi and Firman Ketaun Perkasa.

McKinsey presents ‘mega project’ blowouts and how to avoid them at PDAC

Mineral project development, Mining events, Mining services, , , , , ,

A study presented by McKinsey’s Matthieu Dussud at the Prospectors and Developers Association of Canada’s (PDAC) annual convention has shown one in five “mega projects” completed between 2008-2018 suffered significant cost and schedule overruns.

Out of the 41 projects surveyed – all with a capital expenditure of $500 million or more – 19% suffered a budget overrun of more than 100%. Of these projects, the average schedule delay was 29 months, Dussud said.

Some 44% of the 41 projects were hit by budget overruns of 15-100% – with an average seven-and-a-half month delay – while 17% were “within estimate” coming in less than 15% over the capex budget. Of those projects surveyed, just 20% suffered no cost or time overruns, Dussud said.

The reasons for these problems were multi-faceted, but Dussud, an Associate Partner at McKinsey and Co, said the company’s study had shown a strong correlation between the budget overrun and project size.

For example, 24% of projects with an upfront cost of $500-999 million suffered capex overruns when comparing the feasibility study to the actual cost. At the higher end, 61% of projects with feasibility study capital outlays of more than $2 billion were hit by budget blowouts.

Dussud also said underground mines and higher elevation facilities underperformed against their baselines more consistently in the study, with mining projects built above 3,000 ft (914 m) running overbudget by, on average, 47% and underground mining projects running overbudget by, on average, 55%. Open-pit mines, meanwhile, fared better with 42% of these suffering capital overruns.

McKinsey and Dussud ranked the root causes of mega-capital project cost and schedule overruns in the study, with a difference of opinion seen between owners and contractors.

Both parties agreed that increasing project and site complexities was the biggest problem of eight, but the rankings differed from there on.

From one to eight, mine owners ranked the root causes as follows:

  1. Increasing project and site complexities;
  2. Design processes and investment are inadequate;
  3. Bespoke or sub-optimal owner requirements;
  4. Insufficiently skilled labour at frontline and supervisory level;
  5. Poor project management and execution basics;
  6. Industry underinvests in digitisation, innovation, and capital;
  7. Contractual structures and incentives are misaligned;
  8. Extensive regulation and cyclical nature of public investment.

The contractors, on the other hand, had the ranking as follows:

  1. Increasing project and site complexities;
  2. Poor project management and execution basics;
  3. Contractual structures and incentives are misaligned;
  4. Design processes and investment are inadequate;
  5. Bespoke or sub-optimal owner requirements;
  6. Insufficiently skilled labour at frontline and supervisory level;
  7. Extensive regulation and cyclical nature of public investment;
  8. Industry underinvests in digitisation, innovation, and capital.

Dussud and McKinsey proposed eight key changes for mine owners to increase mining capital project outcome certainty in their feasibility study practices.

This included establishing a prescriptive standard for feasibility studies – part of a broader stage-gate process; building in a systematic and holistic value improvement step to avoid “gold-plating”, and maximising project economics within the owner’s feasibility study approach; leveraging granular benchmarks (including construction productivity metrics) to validate inputs and capex/opex estimates; embedding construction planning, operations readiness and marketing strategy at every step of project study development to de-risk execution and operations; and investing time, effort and management focus on building and optimising an integrated master schedule.

The other three recommendations were:

  • Design an incentive scheme for the feasibility study contractor to enable a “value maximisation, out of the box thinking and transparent mindset” (eg performance bonus based on net present value improvements) and favour “relational contracting”;
  • Setup the foundations of the project’s contracting strategy early during the feasibility study (identify partners, define contract scheme, negotiate terms, etc), and;
  • Build a strong owner’s team with the right capabilities, mindset and behaviours.

NRW looks forward to further growth as iron ore focus pays off

Mine operation news, Mineral project development, Mining equipment, Mining finance, Mining services, Steel and iron ore, , , , , , , , , ,

NRW Holdings has reported year-on-year increases in revenue and earnings in the six months to December 31, 2018, and says its focus on securing work in the iron ore sector has started to pay off.

Revenue came in at A$521.1 million ($370 million) for the six-month period, up 50.9% year-on-year, while earnings before interest, depreciation and amortisation rose from A$40.3 million in the six months to December 31, 2017, to A$74.3 million in the most recent half year.

The company’s order intake in the six months totalled A$1 billion, increasing total work in hand to A$2.4 billion, it said.

Jules Pemberton, NRW’s CEO and MD, said “Not only have we delivered incremental earnings growth, but we have been able to maintain strong cash flows through the period to reduce net debt to A$12.8 million and gearing to 4.3% despite an increase in capital expenditure driven by the purchase of key mining assets.

“All businesses performed on or above plan and it is worth noting that the Golding business has now generated cash equal to its acquisition cost within the first 14 months of ownership.”

The company, in previous outlook commentaries, mentioned NRW was looking to secure work on iron ore sustaining projects in Western Australia; a target that the company is starting to deliver on. Pemberton said: “Progress to date has been extremely positive following the awards of South Flank for BHP, in July 2018, the Koodaideri Plant site for Rio Tinto, announced in January 2019, and the award of Fortescue Metals Group’s Stage 1 Eliwana rail package, in February 2019.”

On top of this, NRW Holdings also announced the acquisition of the RCR Mining Technologies (RCRMT) business last month. On this transaction, Pemberton said: “The RCRMT business has developed a wealth of intellectual property across a range of products and processes and are recognised as leaders by global resource clients The acquisition will allow the company to provide incremental services, in line with our strategic objectives, to a number of core clients common to both NRW and RCR MT and is a very strong foundation on which to build a broader maintenance services business.”

Primero, Qube and Lucas TCS named contractors at Core’s Finniss lithium project

Energy minerals, Industrial minerals, Mineral exploration, Mineral project development, Mining services, , , , , , , , , , , , ,

Australia-based Core Lithium has awarded preferred contractor status for three key components of its 100%-owned Finniss lithium project, near Darwin in the Northern Territory.

The three contractors are key participants in the development team Core is assembling following the granting of the first mining licence earlier this month, it said.

Primero Group has been named the preferred engineering procurement and construction (EPC), and front-end engineering and design (FEED) contractor. Primero has worked on several Australia hard-rock lithium projects including Pilbara Minerals’ Pilgangoora operation and Tawana/Alliance’s Bald Hill mine.

Meanwhile, Qube Bulk Pty has received the status of preferred provider of haulage and transport solutions for Finniss, with Lucas Total Contract Solutions selected as preferred mining services contractor.

Core said it would work with all three companies to finalise contract terms that “reflect the most cost-effective and time-efficient solution for Finniss”.

The FEED study by Primero is underway to improve the accuracy of the EPC estimate on the 1 Mt/y processing plant and associated infrastructure at Finniss, the company said.

In line with its construction schedule, Core is targeting first production of spodumene concentrate from Finniss by the end of 2019.

Core’s Managing Director, Stephen Biggins, said: “These key contract roles are crucial for the success of the Finniss lithium project, so we did not make our decisions on who should be awarded these packages of work lightly. We believe we have selected the best contractors for the respective contracts out a field of worthy contractors, and look forward to working with Primero, Lucas TCS and Qube once the contracts have been finalised and the next phases of work at Finniss get underway.”

He added that final award of the contracts would follow the completion and release of a definitive feasibility study on Finniss, in addition to financing of the project.

Core’s development of Finniss is initially centred on production from the high-grade Grants deposit as an open-pit mining operation and construction of a 1 Mt/y dense media separation process plant to produce a 5% Li2O spodumene concentrate for export.

The prefeasibility study on the project envisaged a total capex of A$53.55 million ($38 million) and A$168 million (pre-tax) in free cash generation over a period of 26 months based on a price of $649/t for its concentrate.