Tag Archives: power

Aggreko to help power up Colluli potash project

Aggreko has been appointed as the preferred power supply contractor for the 12 MW heavy fuel oil (HFO) power plant at the Colluli potash project in Eritrea, Danakali has reported.

The power company will provide a full scope of support services for the supply, commissioning, and maintenance of the power plant, then transfer to the jointly-owned Colluli Mining Share Company (CMSC), under a five-year buy-own-operate-transfer (BOOT) contract. Aggreko will also provide the funding for the power solution, which provides certainty over delivery of this preferred solution, Danakali said.

The choice of the BOOT agreement is due to the equipment being available now and not needing to be built, Danakali, a 50:50 owner of CMSC along with the Eritrea government, said. This will also de-risk the development schedule, it added.

The costs of the power solution provided by Aggreko over the five-year contract period is lower than the front-end engineering design study results, according to Danakali.

Aggreko is funding the capital expenditure required for the power plant and all equipment will be transferred to CMSC at no extra cost at the end of the contract period, Danakali explained. This power solution is scalable and can increase/decrease according to CMSC’s needs, it added.

The agreement between Aggreko and CMSC is subject to the conclusion of ongoing negotiations to optimise the scope of works, contract pricing and execution; and board approval of the final investment decision for Colluli.

In July, the Eritrean Ministry of Energy & Mines paved the way for construction to start at the project after accepting the Colluli Notice of Commencement of Mine Development.

Niels Wage, CEO of Danakali, said: “We are very pleased to announce the appointment of Aggreko as our single power provider. With 55 years of experience in delivering high-quality, reliable service to a large number of projects, we are confident they have the capabilities to provide our power needs for Colluli.

“At the early stages of the project development, the HFO solution will provide us with flexibility and reliability, and as confirmed by social and environmental impact assessment, Colluli will have a relatively small impact on the environment. Going forward, once project development is in more of a steady state, we will look to diversify our energy sources towards renewables available in the Danakil region, as per our commitment to sustainable and environmentally friendly solutions.”

John Lewis, Managing Director, Africa – Aggreko, added: “Our extensive experience in Eritrea and knowledge of the local market means that we are ideally placed to provide a solution which meets the specific needs of Danakali and deliver a reliable power supply for this project.”

Colluli has a JORC-2012 compliant measured, indicated and inferred resource of 1,289 Mt at 11% K20 equivalent and 7% kieserite.

Pacific Equity Partners to power up Zenith Energy

Off-grid power generation specialist Zenith Energy looks like going into private hands after an entity owner by Pacific Equity Partners (PEP) made a bid to acquire the ASX-listed company.

The bid from Elemental Infrastructure BidCo, which has been unanimously recommended by Zenith’s board of directors, values Zenith’s equity at around A$150 million ($98 million) and enterprise value at some $250 million.

It would see all Zenith shareholders receive A$1.01/share in cash, which represents a 45.3% premium to the last closing price of Zenith shares on March 6 of $0.695/share.

Zenith has gained in prominence since becoming a public entity in May 2018. This has seen it deploy several hybrid power solutions including solar and diesel power at gold and base metal operations in remote parts of Australia. Some of its standout work includes a diesel installation at Newmont’s Tanami gold operation in the Northern Territory and a solar project at Independence Group’s Nova nickel-copper-cobalt mine in Western Australia.

Peter Torre, Chairman of Zenith’s Independent Board Committee, said: “Zenith has regularly reviewed opportunities that align with its strategy to maximise shareholder returns. The Zenith Board believes the proposal from Elemental represents an opportunity for shareholders to receive compelling and certain value. The proposal delivers a significant premium and recognises the success of Zenith as a leading provider of reliable energy solutions in the Asia Pacific region.”

Pacific Equity Partners Managing Director, Andrew Charlier, said: “PEP has a strong history in backing management teams in the remote power sector and with the additional capital firepower PEP can bring to Zenith, we are highly optimistic about the company’s future growth.”

Subject to shareholder approval being obtained by Zenith shareholders and the other conditions of the scheme being satisfied, the scheme is expected to be implemented in June 2020.

Suncor to cut GHG emissions by 25% with natural gas project

Suncor has made the decision to replace its coke-fired boilers with two cogeneration units at its Oil Sands Base Plant, in Alberta, Canada, as it looks to lower its carbon footprint within the province.

The cogeneration units will provide reliable steam generation required for Suncor’s extraction and upgrading operations and generate 800 MW of power, the company said.

The power will be transmitted to Alberta’s grid, providing reliable, baseload, low-carbon power, equivalent to around 8% of Alberta’s current electricity demand. This project will increase demand for clean natural gas from Western Canada, Suncor said.

Mark Little, President and CEO, said: “This is a great example of how Suncor deploys capital in projects that are economically robust, sustainability minded and technologically progressive.

“This project generates economic value for Suncor shareholders and provides baseload, low-carbon power equivalent to displacing 550,000 cars from the road, approximately 15% of vehicles currently in the province of Alberta.”

The project cost is estimated to be C$1.4 billion ($1.06 billion), delivering a high teens return and projected to be in-service in the second half of 2023.

“This project will substantially contribute to the company’s goal of an increased C$2 billion in free funds flow by 2023,” the company said. “This will be achieved through oil sands operating cost and sustaining capital reductions along with margin improvements. It will also contribute materially to Suncor’s publicly announced greenhouse gas (GHG) goal.”

Replacing the coke-fired boilers with cogeneration will reduce GHG emissions associated with steam production at Base Plant by some 25%. It is also expected to reduce sulphur dioxide and nitrogen oxide emissions by approximately 45% and 15%, respectively, the company says.

The cogeneration units will eliminate the need for a flue gas desulphurisation (FGD) unit, which is currently used to reduce sulphur emissions associated with coke fuel. Decommissioning the FGD unit will reduce the volume of water the company withdraws from the Athabasca River by around 20%.

“By producing both industrial steam and electricity through a single natural gas-fuelled process, cogeneration is the most energy-efficient form of hydrocarbon-based power generation. Suncor believes this project will contribute to both Alberta and Canada’s climate ambitions.”

Primary Power acquisition to expand BESTECH mining and engineering reach

BESTECH says it is building its power services business and mining engineering capacity through the acquisition of Primary Power Group.

The deal, which will also allow the engineering firm to expand into the Greater Toronto Area (GTA), will see the company achieve:

  • Strategic growth objectives in key markets – BESTECH’s multi-disciplinary engineering team serves clients in the GTA and has global clients who will be well-served by this expansion;
  • Continued business from Primary Power Group’s extensive client portfolio, which includes many of BESTECH’s clients, and;
  • Greater opportunities to provide power and mining engineering services, and to recruit talent in southern Ontario.

Primary Power was founded in 1993 and has been a leader in medium and high-voltage power distribution services and panel manufacturing for more than 25 years, according to BESTECH. It has previously worked on projects with Xstrata Nickel (now Glencore) and Vale Inco (now Vale) in Ontario.

BESTECH, meanwhile, recently spun off its technology solutions division and launched a new company, SHYFTinc.

Primary Power Group will integrate into BESTECH’s Power Systems division, led by Dino Titon, Power Systems Engineering Manager.

Alex Kesik, retiring President and GM of Primary Power, said: “It is with great confidence that we take this opportunity for our team members to work with a larger group and to provide even greater service to our valued clients. We anticipate many unique opportunities for continued innovation and advancement. We are very impressed with BESTECH’s vision and commitment to partnership at every level.”

Patrick Fantin, BESTECH’s Engineering Services General Manager, said: “Primary Power Group has developed an outstanding business and has a reputation for service and quality. They are well-regarded by our major clients for local substation designs. As a team, we see this expansion as a partnership among professionals who care about the work we do, and the clients and communities we serve.

“We are excited about what our combined talents and capabilities will mean for our global clients. It enhances our capacity, our presence, and provides a direct and seamless expansion into the GTA.”

B2Gold to soak up solar power at Fekola gold mine

B2Gold, in its June quarter results, has provided an update on its plans to install a solar plant at its Fekola gold mine in Mali.

The company said it completed a preliminary study to evaluate the technical and economic viability of adding a solar plant to the site, during the quarter, with the results indicating it was a very “solid project” and that a plant of around 30 MW of solar generating capacity with a significant battery storage component would provide the best economic result.

A second study has now been completed to establish the detailed capital and operating cost analysis for the project. Results indicated that a solar plant can provide significant operating cost reductions (estimated to reduce processing costs by some 7%), with the project approved by the B2Gold Board in the June quarter.

The company said: “The Fekola Solar Plant will be one of the largest off-grid hybrid solar/heavy fuel oil (HFO) plants in the world.

“It is expected that it will allow for three HFO generators to be shut down during daylight hours, which will save about 13.1 million litres of HFO per year, at a capital cost of approximately $38 million, of which $20 million is expected to be incurred in 2019, with the balance in 2020.”

The solar plant is scheduled for completion in August 2020 and has a four-year payback, B2Gold said.

At Fekola, the company is currently weighing up an expansion that could see the life of mine could extend into 2030, including significant estimated increases in average annual gold production to over 550,000 oz/y during the five-year period 2020-2024 and over 400,000 oz/y over the life of mine (2019-2030).

Back in May 2018, B2Gold celebrated the official opening of the Otjikoto gold mine solar plant, in Namibia, one of the first fully autonomous hybrid plants in the world.

At the time, B2Gold said it would allow the company to significantly reduce fuel consumption and greenhouse gas emissions from the site’s current 24 MW HFO power plant. The shift to a HFO solar hybrid plant was, at that point, expected to reduce Otjikoto’s HFO consumption by around 2.3 million litres and reduce associated power generation fuel costs by approximately 10% in 2018.

In the company’s 2018 results, B2Gold said the plant was now providing close to 13% of the electricity consumed on site and the plant had achieved its expected HFO consumption and power generation fuel cost results.

Marthinusen & Coutts expertise keeps Africa mine pumping

Marthinusen & Coutts has come to the rescue of one of Africa’s wettest mines by rehabilitating medium voltage pump motors at the operation.

M&C’s Cleveland Engineering Services Division, a division of ACTOM (Pty) Ltd, recently teamed up with the Marthinusen & Coutts Kitwe facility, in Zambia, to carry out the work.

A pump original equipment manufacturer had approached M&C to assess several underground pump motors.

“There was an urgency to the situation due to the risk of flooding should there be any undue interruptions in pumping operations,” M&C, which calls itself the largest after-market service provider of electrical and mechanical rotating machines in Africa, said.

“Investigations revealed the motors driving the pumps were in a poor condition, with this severely affecting the availability and the performance of the pump chambers,” the company said. This required the initiation of a detailed refurbishment program, which involved the procurement of spare parts, the setting up of an on-site bearing store, and taking the lead in returning the motors to full service, according to M&C.

“Where possible, the motors were repaired in-situ – thus avoiding any possible crisis of underground flooding – while others were removed for full refurbishment,” the company said. “The highest level of engineering practices where followed during repairs, re-installation and commissioning.”

Ongoing support is also being provided, including the training of mine maintenance staff, the development of installation and commissioning specifications, conducting of regular site inspections, management of spares, and continual engagement with mine engineering management, according to the company.

Marthinusen & Coutts operates six state-of-the-art repair and manufacturing facilities – in Johannesburg, Benoni, Sasolburg, Rustenburg, Harare and Kitwe – and, supported by a network of technically equipped partners throughout Africa, provides services not only in Africa but globally.

Newmont powers up at Tanami gold mine in Australia

Newmont Mining says it has completed the Tanami power project, in the Northern Territory of Australia, safely and on schedule.

The project included the installation of two power stations, a 66 kV interconnected power line, and a 450 km natural gas pipeline. The pipeline was built and will be maintained by Australian Gas Infrastructure Group, while the power stations were constructed and will be operated by Zenith Energy. Capital costs are estimated at approximately $245 million with annual cash lease payments over a 10-year term beginning in 2019.

The successfully completed project is expected to provide the Tanami gold mine a safe and reliable energy source while lowering power costs and carbon emission by 20%, Newmont said. The project is expected to generate net cash savings of $34/oz from 2019 to 2023, delivering an internal rate of return of greater than 50%.

Newmont Chief Executive Officer, Gary Goldberg, said: “In addition to lowering costs and carbon emissions, the completed Tanami power project will pave the way to further extend the life of the operation.

“Consistent execution and delivery remain the hallmark of our ability to generate free cash flow and create long-term value for our shareholders and other stakeholders. Completion of the project coincides with Tanami pouring its 10 millionth ounce of gold on the back of record production of 500,000 oz last year. This achievement is a testament to the skill of our team as well as our valued partnership with the Walpiri people, the Traditional Owners of the land.”

Tanami is Australia’s second largest underground gold mine and one of the most cost competitive gold producers in the world, according to Newmont. Newmont’s continued exploration work at Tanami has created the potential to extend mine life beyond 2028, with additional upside through a possible second expansion project the company expects to make a full funding decision on in the second half of 2019. Last year, more than 800,000 oz of gold resources were converted into reserves from Tanami’s Auron orebody.