Tag Archives: Newcrest Mining

Newcrest looks to new FMS, haul truck trays for Red Chris improvements

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With gold and copper production dropping and costs increasing, the Red Chris mine, in British Columbia, Canada, is set for a number of improvement initiatives, according to 70% owner Newcrest Mining.

In the company’s September quarter results, Newcrest said Red Chris gold and copper production came in at 12,636 oz and 7,050 t, respectively, during the three-month period. This was down from the 15,440 oz of gold and 8,401 t of copper registered in the June 2020 quarter.

Newcrest said the circa-3,000 oz drop in gold output reflected a higher proportion of lower-grade stockpile material being fed to the mill due to unseasonal rainfall hitting the availability of higher grade ex-pit material.

This lower-grade mill feed adversely impacted recovery rates, partially offset by a 13% increase in mill throughput following process control improvements and a higher proportion of stockpiled material with “characteristics that enabled increased processing rates”, it said.

Red Chris’ all-in sustaining cost of $2,621/oz in the September quarter were significantly up on the $1,536/oz seen in the previous quarter. This was driven by increased sustaining capital expenditure, higher operating costs due to “seasonal benefits allowing increased activities to be scheduled”, together with the impact of a strengthening Canadian dollar against the US dollar and lower copper sales volume, it said. These factors were only partially offset by the benefit of a higher realised copper price.

With one quarter of Newcrest’s 2021 financial year down, the company said it is planning to put in place a number of additional improvements across the site. Included in this is a new fleet management system, the replacement of the conventional Cat 793 truck trays with “high-performance trays” to realise payload benefits, and several throughput and recovery-related projects.

The company has 45,000-55,000 oz of gold and 25,000-30,000 t of copper production slated for Red Chris in its 2021 financial year.

Upon announcing the acquisition of a majority stake in the asset in 2019, Newcrest Managing Director and CEO, Sandeep Biswas, said there was potential to turn the Red Chris orebody into a Tier 1 operation.

It also outlined a two-stage plan to deliver value from the $806.5 million acquisition. This included applying its “Edge transformation approach” to the existing Red Chris open-pit mine and processing plant, and potentially leveraging industry leading mining methods and technology such as block caving, coarse ore flotation and ore sorting.

Capstone considering Eriez HydroFloat tech to boost Pinto Valley performance

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Capstone Mining is continuing to leverage innovative, low-cost technology at its Pinto Valley mine in an attempt to further utilise its existing solvent-extraction and electowinning (SX-EW) plant at the Arizona, USA, operation.

In the December quarter of 2019, Pinto Valley commenced a PV3 Optimization project designed to achieve safer, more reliable and higher capacity operations without major investments in new comminution equipment. A goal was set to achieve increased reliability, and higher throughput at maximised copper recovery with lower costs by leveraging new inexpensive technologies.

In its September quarter results, the company provided an update on this project, saying, to October 27, it had spent $17 million as part of its Phase 1 developments. This included crushing and mill equipment replacements, which are 60% complete with full completion expected by July 2021.

As part of its Phase 2 developments, Capstone spent $10 million in conveyor, mill auto controls, cyclone packs and tailings thickener upgrades. These upgrades are planned to be completed by the end of the September quarter of 2021.

On top of this, the miner completed a blast fragmentation optimisation project to target 30% fines (minus-0.5 in) in run of mine feed in the June quarter. In the same quarter, it completed a $300,000 tele-remote Cat D10 Dozer project to increase worker safety for high-risk applications. Another $6 million was spent on new mine equipment to increase efficiency while lowering diesel consumption, greenhouse gas emissions and other operating costs by $800,000/y. This project was completed in the September quarter.

In terms of its metallurgical innovation, the company continued to use novel catalytic technology developed by Jetti Resources at Pinto Valley, expected to deliver 300-350 MIb of copper cathode over the next 20 years from high-grade mine waste and historic stockpiles at all-in costs under $2/Ib. This technology uses a catalyst on primary sulphide minerals to disrupt the sulphur metal bond of the mineral and allow for a leaching solution to contact the copper. This enables the extraction of the metal to take place unimpeded.

Capstone also made plans to use new reagents to improve worker safety and improve overall metallurgical performance at its molybdenum plant re-start project. This would involve “minimal capital” and completion was targeted by the March quarter of 2021, it said.

Capstone says it is targeting to reach 60,000-63,000 t average daily throughput at Pinto Valley at an 85-90% recovery by 2022-2023. This is 17-30% higher than 2019 performance and is subject to further test work and studies to be completed in the first half of 2021, including tailings management, the company explained.

Added to this, following positive laboratory results on Pinto Valley flotation circuit samples, Capstone and Eriez are planning to commence pilot plant testing of the HydroFloat technology.

The HydroFloat fluidised bed assisted flotation cell has previously proven effective at floating coarse ore particles, up to two to three times the size limit of conventional flotation cells in commercial applications such as at Newcrest Mining’s Cadia Valley operation in Australia. Newcrest has recently decided to expand the use of this technology at the operation.

Capstone says the lab results at Pinto Valley had led Eriez to report an opportunity to reduce copper losses by up to 50%, thereby boosting overall recovery by up to 6% at Pinto Valley.

“Furthermore, the ability to recover coarse particles could allow for higher mill throughput while achieving high copper recovery,” Capstone said.

Other benefits could be lower grinding costs, lower water and energy consumption and increased tailings stability via coarser tailings.

Pilot testing is due to commence in November with results expected back in the March quarter of 2021.

Lastly, work on PV4 expansion scenarios to take advantage of around one billion tonnes of measured and indicated resources at 0.30% Cu continued during the September quarter.

“Given management’s confidence in PV3 Optimization progress to date, including the successful implementation of the novel catalytic technology from Jetti Resources to enhance leaching performance, Capstone has decided to evaluate expansion scenarios using existing assets rather than building new mill infrastructure,” the company said.

The study is assessing higher mining rates, higher cutoff grades to the mill, and an increased tonnage available for leaching.

While a significant mill expansion is not currently being contemplated, an expansion of Pinto Valley’s SX-EW capacity of 25 MIb/y may be necessary, it said. Extensive column leach test work will be conducted over 2021, with the overall PV4 expansion study expected to be released in 2022, Capstone added.

Anglo American, Glencore, Newcrest and Newmont join coarse particle recovery consortium

Comminution of minerals, Environmental, Metallurgy, Mineral processing, Mineral project development, Mining industry recognition, Mining services, Sustainable mining, , , , , , , , , , , , , , , , ,

Researchers from The University of Queensland’s Sustainable Minerals Institute (SMI) have signed an agreement with industry partners to form a consortium to develop improved energy efficiency for mineral processing operations.

The Collaborative Consortium for Coarse Particle Processing Research will run initially for five years and tackle multidisciplinary aspects of coarse particle processing such as flotation, comminution, classification, and equipment design and process chemistry, SMI says.

It will also contribute towards global challenges such as the reduction of greenhouse gas emissions and mitigation of human-made climate change.

The processing of coarse particles is considered one of the key research areas for developing improved energy efficiency of mineral processing operations, according to SMI.

The consortium includes researchers from SMI’s Julius Kruttschnitt Minerals Research Centre (JKMRC) and representatives from Anglo American, Aeris Resources, Eriez Flotation Division, Glencore, Hudbay Minerals, Newcrest Mining and Newmont.

The program Chair is SMI Director, Professor Neville Plint (far left). JKMRC’s Associate Professor, Kym Runge (right), and Dr Liza Forbes (middle) are the Technical Directors.

Professor Plint said SMI and JKMRC have a long history of successful industry engagement.

“This consortium brings together depth and breadth of expertise and significant technical skill, and it shows the willingness of industry to work closely with university researchers to tackle complex problems and have an impact,” he said.

“The team in JKMRC have worked hard and consulted with all our industry partners to create this important forum.”

Newmont’s Director of Processing, Dr Ronel Kappes, said the company had identified coarse particle recovery (CPR) as a key enabling technology to focus on, in order to improve future processing efficiencies.

“The UQ CPR Consortium project is an important step in technology development in order to leverage future CPR applications,” Dr Kappes said.

Eriez Flotation Division’s, Dr Eric Wasmund, said the company was pleased to be a founding sponsor of the consortium.

“This consortium fits EFD’s vision to enable sustainable technology solutions through strong customer partnerships,” he said. “As demonstrated by our leading-edge HydroFloat® technology, coarse particle flotation is a key disruptive technology for improving mineral recoveries, reducing power and water consumption and producing safer tailings.”

The CPR Consortium held its first technical workshop at the end of September.

UQ-led geotechnical project targets open pit mine of the future roadmap

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A A$4-million ($2.8 million) cash injection from industry has marked the beginning of the next phase of research for a large-scale geotechnical project headed up by University of Queensland (UQ) experts.

Professor David Williams (right) and Dr Mehdi Serati (left) have managed the Large Open Pit Project (LOP) from UQ’s civil engineering home base, since 2017, and they recently secured the management of further funding to begin phase three of the project, which will run until 2022.

“The LOP links innovative mining geomechanics and geotechnical engineering research with best practice in open-pit mining,” Professor Williams said. “Australia is a leader in open-pit mining, driven by a forward-thinking industry.

“The LOP has provided a focus for research for the past 15 years and, since 2017, allowed us to collaborate and advance the safety and risk components of open-pit mines.

“The project also ensures that the industry can maintain its immensely valuable contribution to the Australian economy into the future, with mining generating around A$250 billion annually and employing about 15% of the Australian workforce.”

The primary focus for researchers during this three-year term will be to create a roadmap for ‘The Open Pit of the Future’.

Together with international industry partners and research colleagues, the team will bring together cutting-edge knowledge around large open-pit design, operation and closure, supporting future trends, including the interaction with underground mines, and deeper and even more technology-driven unmanned and automated operations.

Dr Serati said the team aimed to produce a new generation of pit slope design guidelines that incorporated everything from the fundamentals of slope design and rock mass characterisation, through to 3D geotechnical modelling, slope monitoring techniques, controlled blasting and open-pit closure.

“In open-pit mining, the design of the slopes is one of the major challenges at every stage of planning, through operation to closure, and requires specialised knowledge of the geology and material geotechnical parameters, which is often complex,” Dr Serati said. “Good open-pit design also requires an understanding of the practical aspects of design implementation, so we need to work collaboratively to cover all of these elements and produce industry-wide best practice guidelines.

“Australia has some of the largest open-pit mines in the world, which are reaching ever greater depths, and the LOP Guidelines are vital in ensuring coverage of all of the important design aspects.”

The LOP is recognised as the premier international research and technology transfer body representing the technical disciplines contributing to large open pits and supporting future trends, UQ says. The LOP fosters close collaboration between industry and researchers, which is essential to meeting industry’s need to continuously innovate.

“A key aim of the LOP is to ensure that the mining industry is a safe, prosperous and environmentally friendly contributor to society,” UQ said.

The industry sponsors for LOP III (third phase) include Anglo American, AngloGold Ashanti, BHP, Debswana, Fortescue Metals Group, McArthur River Mining, Newcrest Mining, Rio Tinto and Vale, with other companies being encouraged to join.

DynaEnergetics and Newcrest Mining devise new blasting initiating system

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DynaEnergetics, a business of DMC Global Inc, has introduced Igneo, an “intrinsically safe initiating system designed for high temperature mining applications”.

The Igneo system is based on DynaEnergetics’ patented IS2™ initiating system, which is used by the oil and gas industry in well perforating operations, it says.

Igneo was developed in collaboration with Newcrest Mining, one of the largest gold mining companies in the world.

The company explained how the collaboration began: “Newcrest approached DynaEnergetics for assistance in developing an initiating system that would perform safely in the extreme conditions of its Lihir mine, located in the crater of the dormant Lihir volcano off the coast of Papua New Guinea. The active geothermal and geochemical environment makes Lihir the hottest open-cut gold mine in the world.”

The core of the Igneo system is the HTD150, an electronic detonator designed to withstand temperatures up to 150°C (302°F) for up to 48 hours. The device is encased in a specially coated copper shell, making it resistant to highly corrosive mining environments, according to the company. Like IS2, the HTD150 is immune to radio frequency interference, stray current and stray voltage, DynaEnergetics said.

The full system consists of the Igneo Digital Firing Panel, the Igneo Programming and Testing Device, and a specially designed Igneo booster charge. The system enables rapid programming, testing and simultaneous initiation of up to 1,000 HTD150 detonators, and also eliminates the need for sensitised booster emulsions, the company said.

Liam McNelis, Vice President of Research and Development for DynaEnergetics, said: “Igneo is the result of three years of close collaboration with the Newcrest team, led by Darren Francis, Principal for Drill and Blast.

“The outcome of our efforts is a highly intuitive and reliable system that has been proven effective under the extremely challenging conditions of the Lihir mine. We look forward to continuing our partnership with Newcrest as the multi-year Lihir project progresses into areas with even higher temperatures.”

Ian Grieves, President of DynaEnergetics, said: “Our development of the Igneo system opens the door to an important new market for DynaEnergetics. There are many large mining operations throughout the Pacific Rim that operate under high-temperature conditions. As we have done in the oil and gas industry, our objective is to work with leading operators to improve the safety, performance and profitability of their projects.”

Newcrest Mining focuses on comminution improvements with CEEC membership

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Newcrest Mining has become the latest member of the not-for-profit Coalition for Energy Efficient Comminution (CEEC).

Headquartered in Melbourne, Newcrest Mining has gold and copper operations in Australia, Papua New Guinea and Canada.

Newcrest Head of Technology and Innovation, Andrew Logan, said the sponsorship of CEEC was a natural fit, as sustainability, technology and innovation, and operating performance were key areas of focus for business transformation.

“We are always seeking ways of adding value to the business, while managing our impacts in a responsible way,” Logan said. “In collaborating with CEEC, we are looking forward to knowledge sharing that can help improve our existing circuits, upskill our people and deliver on our commitments towards more profitable, energy efficient mining.”

Newcrest Head of Metallurgy, John O’Callaghan, said understanding and balancing the energy equation in existing and future operations was critical to success.

“Benchmarking using CEEC’s Energy Curves is very important to us from both a management and operational perspective,” O’Callaghan said. “It’s critical to know where our operations sit compared with each other and with our competitors, especially given the energy intensive nature of comminution.

“The more organisations that get involved in Energy Curves, the more useful and relevant the data becomes, so I’d encourage other miners and their suppliers and partners to contribute to the database.”

CEEC said: “Newcrest joins a growing network of supporters who see the value of knowledge sharing through CEEC to help address common industry challenges. The company has already contributed data to Energy Curves.”

CEEC CEO, Alison Keogh, said she looked forward to collaborating more closely with Newcrest and was excited about the potential flow-on effects to industry that their sponsorship could bring.

“Collaborating with sponsors such as Newcrest and others allows CEEC to be a catalyst for kick-starting more innovative and sustainable approaches to mining and mineral processing,” Keogh said.

“Ultimately, the shared goal of CEEC, our sponsors and everyone who accesses our free and independent resources is to bring benefit to industry, the environment and the communities in which we operate.”

Monadelphous bolsters Pilbara iron ore order book

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Monadelphous Group has added another A$150 million ($101 million) worth of construction and maintenance work in the resources and energy sectors to its portfolio after being awarded contracts from the likes of BHP, Rio Tinto, Fortescue Metals Group and Newcrest Mining.

The company is set to continue its stay in the Pilbara of Western Australia having secured a contract under its existing BHP Western Australia iron ore (WAIO) asset panel framework agreement associated with the dewatering of surplus water at Mining Area C (Yandi mine, pictured).

Close by, it has received a three-year contract with Rio Tinto for the provision of maintenance services and minor projects on its Pilbara marine infrastructure, and one-year extensions to its two existing fixed plant maintenance and shutdown crane services contracts with Fortescue.

In addition, Monadelphous has been appointed to BHP’s WAIO Site Engineering Panel for a further two-year term, to provide civil, structural, mechanical, piping and marine services at its mine site and port operations in the Pilbara.

In Papua New Guinea, meanwhile, Monadelphous has sealed a new three-year contract to provide minor capital project services, including civil, mechanical, structural, piping, and blast and paint at Newcrest Mining’s gold mining operations on Lihir Island. The company has been providing services at Lihir Island since 2017.

Added to this is a four-year contract to continue providing mechanical and electrical maintenance and turnaround services for a customer’s midstream operations in the Queensland, Australia, coal seam gas market.

Newcrest and Chevron Australia sign natural gas agreement

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Newcrest Mining has signed a domestic gas sale agreement with Chevron Australia that will see the energy company deliver domestic gas from its portfolio across the Wheatstone (pictured), Gorgon and North West Shelf facilities, in Australia.

Some 16 PJ of equity domestic gas will be delivered over the 3.5-year agreement, which will begin soon and end in July 2023, according to Chevron.

Chevron Australia Managing Director, Al Williams, said: “Chevron is a leading and growing domestic gas supplier to Australia and we’re proud to deliver new natural gas supply to Western Australian industries, businesses and households.”

He added: “As a reliable and cost-effective way to generate electricity, natural gas is a vital energy source for current and future energy needs, powering local jobs, industry and communities.”

At full capacity, the Chevron-operated Gorgon and Wheatstone natural gas facilities will produce 500 TJ/d of domestic gas for the Western Australia market – enough to generate electricity for 4.3 million households, according to the company.

As a key and growing participant in the evolving Western Australian market, Chevron is actively marketing domestic gas under long and shorter-term arrangements.

Macmahon moves into “cash flow positive” territory on Newcrest Telfer contract

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Macmahon Holdings says it has come to an agreement with Newcrest Mining over the increased rates for its work at the Telfer gold-copper mine, in Western Australia, with the settlement leading to the contract becoming “cash flow positive” over its remaining term.

In June, Macmahon said it had commenced facilitated negotiations with Newcrest regarding pricing for changes to the mine plan and contract program at Telfer following a disagreement between the two parties.

Macmahon first commenced the Telfer life of mine contract in February 2016 and, “despite previously disclosed risks and difficulties associated with the project, achieved an operational turnaround in 2018”, it said. Without a rate increase being agreed by Newcrest or some other form of contract amendment, the mine plan and program changes had a negative impact on Macmahon’s costs and returns from the project, according to the contractor.

Telfer, some 450 km east-south-east of Port Hedland, comprises the Main Dome and West Dome open pits and the Telfer underground mine.

Macmahon CEO and Managing Director, Michael Finnegan, said: “The resolution of this dispute means we can now focus all of our attention on maximising the performance of our existing business, and capitalising on growth opportunities. We have several opportunities in our tender pipeline that we are pursuing from an exclusive or shortlisted position, and I am optimistic about the prospects of winning additional work in Australia and achieving further growth in our profitable operations offshore.”

Macmahon has reiterated its financial year 2020 guidance, with revenue expected to be between A$1.2-$1.3 billion ($829-898 million), and EBIT between A$80-$90 million.

Gold price rise revealing exploration deficit, Wood Mackenzie says

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Even though the resurgent gold price has garnered a renewed sense of optimism in the gold industry, a lack of exploration spend from miners means it is facing a potential period of secular decline over the long-term, according to Wood Mackenzie’s gold team.

Exploration budgets were slashed following the fall in the gold price from the highs that were reached in 2011/2012 and they have since failed to recover, according to Wood Mackenzie.

“The slight rebound in exploration spend we have seen over the past couple of years has largely been focused on brownfield projects and near-mine development,” the analysts said. “This has not been sufficient to replenish mined ounces and, as such, peak gold supply is now a very real possibility.”

Over the past couple of months, with gold breaking through $1,500/oz, it seems that exploration activity may be turning a bit of a corner.

The analysts provided evidence:

  • In late June, Agnico Eagle Mines started an exploration drilling program at its Amaruq site in an effort to convert underground indicated resources;
  • On September 4, Polyus announced the completion of an exploration drill program at its Sukhoi Log project (pictured) that totalled 203,647 m and is planning 30,000 m of infill drilling in 2020; and
  • On September 10, Newcrest reported that its exploration program on the Havieron project, located 45 km east of Telfer in Australia, has four operating drill rigs, which have cut 6,166 m and a fifth drill will begin in September.

It will be some time, however, before this activity translates into reserves and ultimately into production.

Proposed exploration budgets for the largest producers in 2019 remain fairly conservative compared with the levels reached in 2012, according to the analysts. It would therefore seem unlikely that the trend in declining reserves will be abated this year.

Producers have been very vocal in reaffirming their strategy of cost control, portfolio management and capital discipline, particularly since the run up in the gold price, ensuring they do not get criticised for the same type of costly M&A and marginal project spend they carried out in the previous gold price highs.

“How steadfast miners will be to this strategy into 2020 and beyond, if prices continue to remain well supported, remains to be seen,” the analysts said.

Due to insufficient exploration spend, gold reserves have depleted significantly with the global average mine life falling from 16 years in 2012, to an estimated 11 years in 2018, they said. However, the largest producers are not facing quite such an acute situation, with their collective average mine life still over 16 years. “It is perhaps therefore not so surprising that they can afford a more calculated approach to replenishing reserves.”

To secure their longevity as pillars of the gold industry, Wood Mackenzie said it has seen heightened M&A activity and miners focusing on their core assets. While this may help to bolster balance sheets through improved operational performance and realised ‘synergies’, it seemingly does little to address the problem the industry is facing with regards to how to sustain current production levels.

“We have, as of late, noticed an uptick in some majors opting to increase their footholds in a select few juniors with promising exploration opportunities,” the analysts said.

Agnico Eagle, AngloGold Ashanti, Kinross and Newcrest are actively investing in, or entering into joint-ventures with junior gold companies to create long-term value.

Agnico Eagle announced a proposal on June 24, 2019 for an all-share acquisition of Alexandria Minerals Corporation at a $0.05 per share premium to the Chantrell Ventures Corp offer; however, O3 Mining acquired Alexandria on August 1, 2019.

AngloGold Ashanti upped its stake in Pure Gold Mining to 14.3% on July 16, 2019, which owns the Madsen gold project in Red Lake, Ontario.

Kinross purchased the near-surface, early-stage Chulbatkan project in Russia from N-Mining Limited for a total consideration of $283 million on July 31, 2019.

And, Newcrest entered into a 70-30 joint venture with Imperial Metals on August 16, 2019, where Newcrest will be the operators of the Red Chris mine, a potential ‘Tier One’ asset in British Columbia, Canada, the gold miner has said.

The analysts said: “We expect to see this trend of increased M&A activity to continue, particularly amongst the more mid-tier gold producers as they look to solidify their own positions in the industry. This will likely encompass mergers with peers to unlock shareholder value and the acquisition of assets that majors have determined to be non-core.

“This may help to progress some later stage projects into production that have been sitting on the shelf for a number of years, but we are not anticipating a knee jerk reaction to current prices. Smaller projects which have a short payback period, in a low sovereign risk jurisdiction, are an attractive proposition and we could see a number of these projects being fast tracked into production.”

And, going forward, to address the predicament of declining reserves, if prices remain elevated miners may be inclined to review their reserve and resource price assumptions, the analysts said.