Tag Archives: Quellaveco

Anglo American and ENGIE agree on ‘green’ electricity supply for Quellaveco

Anglo American and ENGIE’s Peru-based subsidiary have signed an agreement to convert the current contracted energy supply for the Quellaveco copper project to 100% renewable sources, in addition to agreeing on another eight years of energy supply for the mine, starting in 2029, from “green energy” inputs.

The agreement will see Quellaveco, a copper project being developed by Anglo and Mitsubishi Corp, become the first mining operation to promote the construction of a non-conventional renewable energy plant, according to ENGIE.

As part of the pact, ENGIE Energía Perú has agreed to convert the total electricity supply for Quellaveco (187 MW) to 100% green energy, with 150 MW of supply over eight years from 2029 also coming from green energy sources.

ENGIE Energía Perú will source the renewable energy from its Punta Lomitas wind power plant, an in-development wind farm with a joint nominal capacity of 260 MW located in Ocucaje-Ica and a 60 km transmission line connecting the plant with the National Interconnected Electric System. The project has been granted a generation and transmission concession by the Ministry of Energy and Mines, and construction is expected to start in the second half of 2021, the company says.

Tom McCulley, CEO of Anglo American in Peru, said: “We are working from different areas to contribute to a healthy environment. Our goal is to transform the very nature of the industry to ensure a safer, cleaner and more sustainable future.

“By resorting to the use of higher precision technologies, such as those that Quellaveco will have, as well as by focusing on consuming less energy and less water, we will reduce our environmental footprint for every kilogram of copper that we produce, starting in 2022.”

Rik De Buyserie, CEO of ENGIE Energía Peru, added: “Thanks to the renewable energy certificates delivered by the Punta Lomitas Power Plant to supply the demand for the Quellaveco project, we are proud and committed to accompany our client Anglo American and mining in Peru, on their path to carbon neutrality.”

Quellaveco, owned 60% by Anglo and 40% by Mitsubishi Corp, comes with a production blueprint of 300,000 t/y of copper over the first 10 years of the mine, with first production expected in 2022.

Anglo’s Quellaveco to receive the coarse particle recovery treatment

Anglo American has approved the construction of a coarse particle recovery (CPR) plant at its in-development Quellaveco copper project in Peru.

The announcement came within the company’s 2020 financial results, which showed Anglo generated underlying EBITDA of $9.8 billion and a profit attributable to equity shareholders of $2.1 billion for the year.

CPR, Anglo says, is one of many significant breakthrough technology initiatives that has the potential to increase throughput and productivity, while simultaneously reducing environmental footprint, through rejection of coarse gangue (near-worthless waste material), dry stacking of sand waste, minimising the production of traditional tailings and reducing overall water consumption.

The CPR plant signoff at Quellaveco follows a full-scale demo plant installation at the company’s El Soldado mine in Chile – which is ramping up to full capacity by mid-2021 – and the decision to construct a full-scale system at the Mogalakwena North PGM concentrator in South Africa.

The El Soldado plant used the HydroFloat™ CPR technology from Eriez’s Flotation Division. Here, a single 5 m diameter HydroFloat cell, the largest in the world, treats 100% of mill throughput, with the objective of proving the waste rejection process at full scale.

Anglo said of the Quellaveco CPR plant: “This breakthrough technology will initially allow retreatment of coarse particles from flotation tailings to improve recoveries by circa-3% on average over the life of the mine. This investment will also enable future throughput expansion which will bring a reduction in energy and water consumption per unit of production.”

The capital expenditure of the CPR project is around $130 million, with commissioning of the new plant expected in 2022. DRA Global previously carried out a feasibility study for the CPR plant at Quellaveco.

In terms of Quellaveco project progress, Anglo said today that, despite the COVID-19-related slowdown, first production was still expected in 2022. This was, in part, due to the excellent progress achieved prior to the national lockdown, and based on optimised construction and commissioning plans, Anglo said.

Key activities in 2021 include the start of pre-stripping, which will see the first greenfield use of automated hauling technology in Peru; progressing construction of the primary crusher and ore transport conveyor tunnel to the plant; completion of the 95 km freshwater pipeline that will deliver water from the water source area to the Quellaveco site; completing installation of the shells and motors for both milling lines; and completion of the tailings starter dam.

The mine, owned 60% by Anglo and 40% by Mitsubishi Corp, comes with a production blueprint of 300,000 t/y over the first 10 years of the mine.

Cat revamps 6060 hydraulic mining shovel

Caterpillar has launched its next generation 6060 hydraulic mining shovel, which, it says, features multiple design enhancements and new components that advance machine performance, durability, serviceability, and operator comfort.

The new 6060, which replaces the 6060B in the hydraulic mining shovel lineup, features updated engines, optimised hydraulics, heavy-duty structures and undercarriage, Cat electronics and a state-of-the-art cab, according to the company. It is also fully integrated into Caterpillar product support systems for efficient Cat dealer services.

One of these new-generation shovels is set to operate at Anglo American’s in-development Quellaveco mine, in Peru, as part of a fleet that includes autonomous 794 AC trucks.

The 600-t class mining shovel has a bucket payload of about 61 t/pass in both face shovel and backhoe configurations. This makes it an efficient four-pass match with the 231-t payload Cat 793 mining truck and five-pass match with the 291-t payload Cat 794 AC mining truck.

Twin Cat 3512E engines are optimised for high performance, fuel efficient operation and increased durability, according to the company.

For North America, the engines are equipped with a maintenance-free diesel oxidation catalyst emissions control system, do not use diesel exhaust fluid and comply with US EPA Tier 4 Final regulations, Cat says. The updated engine design boosts reliability and extends time between overhauls by 10%.

The combination of this updated engine and optimised hydraulics enables 10-15% percent better fuel efficiency compared with the previous face shovel model, with 3-5% greater efficiency for the backhoe configuration, Cat says. For reduced maintenance, engine oil and filter change intervals are doubled to 1,000 hours.

Structural, undercarriage and slew ring upgrades help maximise uptime and productivity and lower cost per tonne, according to Cat. To boost longevity, the Cat undercarriage features heavy-duty rollers, idlers and tracks, along with a revised track tensioning system. The superstructure frame, face shovel and backhoe attachment structures, meanwhile, have been redesigned to reduce structural repair and extend service life via increased plate thicknesses and geometrical improvements. The slew ring design extends component life with a triple-race roller bearing and sealed internal gearing.

“The 6060 features a new, state-of-the-art cab and operator station with industry-leading visibility provided by the large floor window and expansive windshield and side windows,” Cat said. “Unrestricted lines of sight to the crawler tracks and pit floor aid the operator when repositioning the shovel and when loading trucks.”

A pneumatically cushioned operator seat can be heated and ventilated. It also has integrated joysticks and is multi-adjustable to offer optimal ergonomics.

This cab also includes two additional seats: a full-size seat and laptop desk for a trainer and a fold-up seat for an observer. The three-seat cab design is the first in this size class of shovels, Cat says.

Improved sound suppression on the power module keeps spectator sound levels low, while the sound suppressed cab provides a quiet working environment for the operator, according to the company.

The first of several features within the available Operator Assist suite, Enhanced Motion Control is standard on the shovel. This improves machine controllability and loading efficiency while reducing linkage and cylinder mechanical contact, according to Cat.

The machine’s five-circuit hydraulics design allows simultaneous control over two cylinder motions, two travel motions and swing to boost digging and loading efficiency, the company added.

The next-generation design helps improve service and maintenance efficiency by offering more room inside the service compartment and easy ground-level accessibility to the service station, Cat says.

Integration of Cat hoses in the design allows for local hose sourcing, while improved hose and component organisation further reduces machine downtime.

Sensors located throughout the 6060 monitor operating data, record faults and give audible and visual notifications of issues to the operator. Product Link™ Elite, which is standard for the first time on the 6060, enables data communication for remote machine health monitoring.

The 6060 comes ready to accept Cat MineStar™ Solutions, a suite of mining technologies geared to enhance mine safety, improve efficiency and reduce operating costs.

In addition to the next generation diesel-powered 6060, Caterpillar continues to offer the electrically powered 6060 AC FS (face shovel) for mines optimised for such machines.

Minas-Rio could feel the effects of coarse particle flotation tech, Anglo says

The coarse particle flotation technology being explored as part of Anglo American’s FutureSmart Mining™ platform is gaining traction after the company announced it was to carry out a prefeasibility study on applying it at the Minas-Rio iron ore mine, in Brazil.

The announcement, made during a “Bulks Seminar & Site Visit” in Brisbane, Australia, comes shortly after DRA Global confirmed it had been awarded a feasibility study contract to build a coarse particle recovery plant at Anglo’s Quellaveco copper project, currently in construction in the Moquegua region of Peru.

During the seminar, Anglo said the application of coarse particle flotation technology could see 20% of feed rejected as silica sand, improving the product quality and consistency at Minas-Rio. It also said it could potentially provide a circa-$500 million net present value uplift at the operation, on top of a 15% water saving and 20-30% mill energy reduction.

The coarse particle flotation technology is expected to play a key role in the company’s aim to ultimately eliminate tailings dams, according to Anglo American Technical Director, Tony O’Neill.

It should allow the company to coarsen grind size while maintaining recoveries – thereby reducing the energy required to grind ore, as well as reducing water intensity by more than 20%. When combined with dry-disposal technology, the company is targeting a reduction in water intensity of more than 50%.

The company previously said it was set for trials of the technology at its Amplats operations in 2020.

The flowsheet at Minas-Rio currently includes crushing, screening, milling, desliming, grinding and flotation, with 38% Fe grade ore upgraded to a 67% Fe pellet feed product.

Anglo American’s FutureSmart Mining on its way to tangible technology results

“It’s clear that the pressures on us are unsustainable, whether it is around our carbon footprint, water footprint, or physical footprint, and we are always looking for different ways to push us in this future direction where our footprint will be very different.”

Tony O’Neill, Anglo American Technical Director, knows the company he works for is up against it when it comes to retaining its reputation as one of the world’s leading sustainable mining companies.

It’s clear from the company’s 2018 sustainability report – which saw it achieve a best-ever performance in terms of injuries, a cut in energy use and an increase in greenhouse gas emission savings – that Anglo is going down multiple paths to reach its goals. O’Neill, who joined the company almost six years ago, believes Anglo’s FutureSmart Mining™ programme will play a major role in confronting and overcoming many of the issues it (and the industry) is facing.

“If you look at FutureSmart Mining, at its absolute essence, it is about footprint; how do you change the footprint of mining? How do you have a mine that draws no fresh water? Mines without tailings dams? Mines that look very different?” he told IM.

“It’s getting people to believe there is a different way for mining in an industry that has, to this point, been quite traditional. It is not going to happen overnight, but I think we have a genuine vision that is, in my view, quite feasible.”

IM spoke with O’Neill and Donovan Waller, Group Head of Technology Development, this week to get to the bottom of how technology is making Anglo ever more sustainable.

IM: Could you explain how the Anglo operating model facilitates and fosters innovation within the context of FutureSmart Mining?

TO: The Anglo American operating model is the chassis that underpins everything, giving us certainty in the delivery of our work. When you have got that stability – and the lack of variability – in your business outputs, it is much easier to overlay new technologies and processes. When you then see a difference in operating or financial results, you can confirm it is down to what you have implemented, rather than the underlying processes.

I look at it a little bit like a three-legged stool: you have the operating model on one leg, the P101 benchmark-setting on another, and technology and data analytics on the third leg. They all co-exist in this system and work off each other. Without one, the stool falls over.

The operating model has given us a drumbeat of delivery, and we get the licence to innovate because of this drumbeat.

IM: Do you think FutureSmart Mining is starting to be understood and valued by investors?

TO: They’re awake to it now. I think it is still in the early stages of the story, but they can see what we are doing and the ambition behind it. Ultimately, it will result in a different investment profile, or more investors because of it, but I am not sure that it’s translated in full up to now. The recognition has been more around the general results of the company.

With all these technologies coming through – much of them driven by higher levels of data and the ability to interrogate that data – the vision we imagined way out into the future, I think, is a lot more tangible than when we started out four years ago.

IM: Out of all the tailings dam elimination work you are carrying out (around passive resistivity, fibre-optics, micro-seismic monitoring, coarse particle recovery, polymers, and dry stacking), which innovation will have an impact on Anglo’s operations in the next three-to-five years?

TO: All of them. We started out with our tailings programme in 2013; in fact, our group technical standards were re-issued at the beginning of 2014 and they are now one of the main guidelines the ICMM (International Council on Mining and Metals) uses.

Tailings dams have always been at the back end of the mining process and, in a way, the science behind them has never been part of the mainstream operation. Our view, internally for many years, is tailings dams are one of the industry’s greatest risks.

“Our view, internally for many years, is tailings dams are one of the industry’s greatest risks,” Tony O’Neill says

Ultimately our aim is to eliminate tailings dams. Period. Coarse particle flotation – getting that coarser particle size that drains much more freely – is core to that and you can see a development pathway there. For example, with some of these new flotation techniques, we now only need 1% exposure of the mineral for it to be effective. In the past, it was much higher.

When we upgraded the capability of our tailings organisation, it became clear we needed to get a lot more data off these tailings dams. About three years ago, we started putting fibre-optic sensors into the dams. We have since developed, through our exploration arm, passive resistivity seismic monitoring, which basically tells you where your water sits in the dams. And, we’re putting into Quellaveco micro-seismic measuring techniques, which will be more granular again. You can see the day coming really quickly where tailings dams are a real-time data source for mining companies.

We’re also, with our joint venture partner Debswana, building the first polymer plant in Botswana, which could have an impact on dry tailing disposal.

The thing we need to crack – both ourselves and the industry – is how to dry stack at scale. At the moment, that is still a work-in-progress, but it is doable in the long term.

IM: How is the bulk sorter you have operating at El Soldado, which is equipped with a neutron sensor, working? How has it made a difference to recoveries and grades at the operation?

TO: With the bulk sorter, we’re taking packages of tonnes rather than individual rocks to enable us to get both speed and volume. At El Soldado, we are sorting in four tonne packages. You can adapt the sorting profile by the characteristics of the orebody. We’re generally looking to sort tonnages that are less than you would put in a haul truck body or bucket.

If you step right back, in the past, most processing plants wanted to blend to get an average feed. We are going the other way. We want to use the heterogeneity of the orebody to its advantage; the less mixing we can get ahead of these sorting processes, the better it is for recoveries.

Being able to remove an orebody above the cut-off grade alongside waste tonnages and upgrade the latter has led to an effective lift in head grade. It has been enabled by new sensing technology with a particular type of neutron sensor.

What we have seen in early results has surprised us on the upside. We thought we would see a 5% uplift in head grade, but in fact we have seen about 20% – to qualify that, it’s in its early stages.

O’Neill says the bulk sorting trial at El Soldado has seen about a 20% uplift in head grade in its early stages

If you take this to its logical conclusion, you can see the day coming where you would cut the rock – no drilling and blasting – immediately sort the rock behind the machine cutting it and distribute said rock efficiently into its value in use; you don’t have stockpiles, you have plants sensing the material right through and adapting in real time to the change in mineralogy. I think there is another 3-4% increase in recovery in that whole process when we get it right.

Our sweet spot when we created FutureSmart Mining was always the orebody and processing plants, more so than automation (although that is part of the potential mix). That was different to a lot of the other players in the industry. This focus could lead to the development of different types of plants; ones that are flexible, more modular and you can plug and play.

IM: Do you see these type of neutron sensors being applied elsewhere across a mine site?

TO: Yes, through processing plants and conveyors. In fact, we’re preparing for this on conveyors right now.

What we have found with all this new technology is that, when we implement it, quite often another opportunity arrives. They end up playing off each other, and that is the context for the bulk sorting and coarse particle flotation.

IM: How have Anglo’s Open Forums played into these developments?

TO: We have held eight Open Forums on sustainability, processing, mining, exploration (two), future of work, energy and maintenance.

Out of those eight, I think we have got around 10,000 ideas from them. These forums have been specifically designed where only about a third of participants are from the mining industry, with the other two thirds coming from the best and brightest analogous industries we can tap into – automobile, oil & gas, food, construction, even Formula 1 racing and NASA.

The reality is that out of those 10,000 ideas, the success rate is about 1:1,000, but the one that makes it is quite often a game changer.

IM: Going back to the bulk sorters, am I right in thinking you plan to put these into Mogalakwena and Barro Alto too?

TO: The aim is to have them across our business. At El Soldado, the copper angle is very important. The technology – the sensing and using the data – is probably a touch more advanced in copper, but we are building one currently in our PGMs business at Mogalakwena and a bit behind that, but ready to be built, is one in nickel, yes.

In terms of our programme, you will see them spread across our business in the next, hopefully, 18 months.

IM: Where does your approach to advanced process control (APC) fit into the FutureSmart Mining platform?

TO: We want to have APC in some form across all our business by the end of this year. We have probably come from a little behind some of the other players in the industry, but we’re pushing it quite aggressively to give us the platform for data analytics. The upside we have seen just by putting the process control in so far has surprised me a bit – in a good way; power reductions, throughput, having this different level of control. All of it has been pleasing.

We spent about 12 months looking at the whole data analytics space to see how we were going to implement our solution. If you look around at the sector, everyone wants to be involved and profit share. If you add it all up, you could end up with not a lot of profitable pieces at the end. We have strategically chosen the pieces we think are important to us and our profit pool and have been happy to be a little looser on some of the non-core areas.

The other key plank to the APC is that we own the data. The reality is, in the new world, data is like a new orebody and we’re not willing to let go of that.

IM: Your Smart Energy project involving a haul truck powered on hydrogen has certainly caught the attention of the market: how did you come up with this innovation?

TO: Initially, we couldn’t make renewables work from an investment criteria perspective – it was always close, but never quite there. Donovan’s team then took an approach where they said, ‘forget the normal investment criteria. All we want to do is, make the business case wash its face.’ In doing so, it enabled them to oversize a renewable or photovoltaic energy source – the power plant – using that extra power to produce hydrogen and putting that hydrogen to use in the haulage fleet. Re-engineering the haulage fleet gave us the business outcomes we were looking for.

DW: These business cases bring you to temporary barriers. When you hit that temporary barrier, people normally stop, but what we said was, ‘OK, just assume it is not there and go forward.’ That brought the whole business case back again by looking at it differently again.

Anglo’s Smart Energy project is aiming to power a 300-t class truck with hydrogen fuel

IM: Where is this project likely to be situated within the group?

TO: We’re still not 100% fixed as the initial work will be done here (the UK). You are talking about quite specialist skills working with hydrogen.

When the system has gone past its initial testing, it will go to a site, probably in South Africa, but we are not 100% locked into that at this point.

IM: On the 12-month timeline you have given, when would you have to be on site?

TO: The infrastructure will be pre-built here in the UK. We’re effectively testing it here. In a way, the physical truck is the easy bit.

It’s going to be using a 300-t class truck. The guys have already done quite a bit of the detailed measuring and the design elements are well under way.

We’ve also taken the approach to use pre-approved technology, which Donovan can talk about.

DW: This minimises the risk on the first go and allows us to, later, tailor it. For example, if you don’t have a right sized fuel cell currently available off-the-shelf, you just use multiple standard-size fuel cells for now. Then, when you get into the final version you could tailor them into something more specific.

IM: On mechanised cutting, you recently mentioned the building of a “production-sized machine” for at least one of your mines in South Africa. Is this a variant of the Epiroc machine – the Rapid Mine Development System – you have been using at Twickenham?

TO: It’s the next generation of machines. It’s fair to say that, in the last 12 months, the technology has come to the point where we are confident it is viable.

What we’re looking for is a fundamental breakthrough where, for example, we can take the development rates up three or four times from what you would usually expect. That is what we’re chasing. It would involve some sort of pre-conditioning of the rock ahead of the cutting, but the cutting, itself, works.

For us, mechanised cutting is a real solution to some of the safety issues we have had on our plate. Regardless of whether it goes into South Africa or another underground mine, we see it as a key part of our future underground design and operation.

IM: What type of rock pre-conditioning is this likely to be?

TO: I think around the world, people are looking at electricity, microwave, laser, a whole suite of things. None of them have yet quite landed, but they all have potential.

IM: Where does haul truck automation fit into the pipeline for Anglo American?

TO: All the equipment we buy, going forward, will be autonomous-capable, which means we can run it in either format (manned or unmanned). You are then left with a number of decisions – have you got the design to retrofit automation? Is there a safety issue to be considered? Is there a weather issue to contend with? There are a whole series of gates that we’ll take it (automation projects) through.

It’s good to go back to P101 here. Where P100 is getting all of our key processes to world-class benchmarks, P101 is about establishing a new benchmark. By definition, if you get your operations to that point, the gap between that manned performance and autonomous performance is not that great.

Autonomy is part of our future armoury, but when and where and how, we’ll have to wait and see. For example, we are currently looking at the option of autonomous haulage trucks at one of our open-cut mines in Queensland.

When you look at our portfolio of operations, it’s often a more complex environment than when you are just working in the wide open Pilbara.

GIW pumped with Anglo American Quellaveco copper project order

GIW Industries says it is to deliver four MDX 600 cyclone feed pumps to Anglo American’s Quellaveco copper project in Peru.

GIW, a subsidiary of KSB, won the order based on the reputation of its centrifugal slurry pumps and the firm’s commitment to customer support, it said. “Decades of experience in slurry transport means GIW is in the perfect position to partner with Quellaveco.”

Anglo American plans on first copper production coming out of Quellaveco in 2022, which, with a reserve of 1,300 Mt at 0.58% Cu, is expected to have a 30-year mine life at an average production capacity of 127,500 t/d. This could see the mine produce around 300,000 t/y of copper.

The Quellaveco project marks a significant milestone for GIW as it continues to invest in the region, the company said. In 2018, it expanded its service capabilities in South America to meet the needs of current and future customers.

Local GIW technicians will be on-site to assist Quellaveco for the installation, commissioning, and start-up of the four MDX 600 cyclone feed pumps, according to the company.

“The MDX pump was selected for the Quellaveco project because of its success in copper and gold applications around the world,” GIW said. “The MDX product line has undergone extensive development; in fact, the latest technology features a remotely adjusted mechanical suction liner.

“The pumps for Quellaveco are specially designed to operate in the most extreme duty conditions. Critical wear parts are made of GIW’s proprietary white-iron alloy, Endurasite. This material extends wear life and optimises pump performance.

“These features combined have a direct impact on Quellaveco’s total cost of ownership – proving the MDX is the most reliable pump on the market.”

Hernan Palavecino, South America Region Manager for GIW, said economic stability and continuous growth in the country have facilitated the investment of new mining projects in Peru, with the country, over recent years, becoming a key player in the global market.

“GIW recognises the importance of the Quellaveco mine to the region,” he said. “The greenfield project solidifies Peru’s position as a substantial player in the South American and global mining markets. The award is a result of GIW’s drive for continuous improvements in slurry technologies. We are committed to offering high-quality service while building a long-term partnership with Quellaveco.”

Anglo American selects Epiroc drilling equipment for Quellaveco copper project

Epiroc has been awarded a “significant” order from Anglo American for its new copper mine in Moquegua, Peru, Quellaveco.

The diversified miner has ordered multiple drill rigs and related equipment to be used at the planned open-pit copper mine as it looks to build an operation with optimal safety, productivity and efficiency, Epiroc said.

The order totals about $44 million, with most of the contracted value booked in the December quarter of 2018 and a smaller portion booked in the current quarter, Epiroc said.

Helena Hedblom, Epiroc’s Senior Executive Vice President Mining and Infrastructure, said: “We are proud to once again team up with Anglo American and play a key role in making sure that its new mine in Peru is operated in the most productive, safe and cost-efficient manner possible.”

The order includes Pit Viper 351 and SmartROC D65 drill rigs, BenchREMOTE remote operator stations (pictured), rock drilling tools and HB 10000 hydraulic breakers.

“The machines incorporate state-of-the-art technology features,” Epiroc said, adding that operators are, for example, able to run rigs remotely from a safe distance.

Delivery of the machines will start in early 2020 and continue through 2021, in line with Anglo American’s plan of first copper production during 2022.

Fluor is carrying out the project build at Quellaveco as part of an EPCM contract. With a reserve of 1,300 Mt at 0.58% Cu, Quellaveco is expected to have a 30-year mine life at an average production capacity of 127,500 t/d. This could see the mine produce around 300,000 t/y of copper.

Innovation and integration unlocking doors for Fluor’s mining and metals business

With mining companies looking to replenish spent resources in many commodities, EPC and EPCM contractors’ pipelines are starting to fill up.

IM Editor Dan Gleeson spoke with Tony Morgan, President, Mining and Metals, Fluor, to find out how the contractor is continuing to win business and differentiate its offering from the rest of its peers.

International Mining: How important is securing early-stage involvement in mining projects in terms of eventually winning the major EPC/EPCM contract?

Tony Morgan: It is very important and there are some good reasons for that. If you get a contractor that is used to building significant projects and can apply the right tools in the earlier phase of the project, you will receive an aligned project in terms of the technology used, execution strategy and the techniques, such as modularisation. All of these plans will be built in at the front-end of the project and, when you go into the execution phase, the personnel executing the project will be well-versed in the strategy.

Quellaveco in Peru (pictured), South Flank in Australia, a bauxite mine in Guinea and Peñasquito in Mexico are good examples of projects where we were engaged in the early stages and helped set the projects up for success.

This isn’t to say that if one contractor starts a project, another contractor cannot come in. We have taken over and succeeded in the execution of several projects in this way. This typically occurs when the client deems that the previous contractor will be unable to perform the project’s execution phase because of the project’s size or the contractor has failed to perform in the current phase.

IM: Has the talk from mining companies of more EPC/EPCM contracts being offered with incentives/penalties that effectively share execution risk become a major trend in the industry?

TM: There’s always been a desire to include penalties and incentives in contracts. The extent to which these can be evenly applied really depends on the market, whether contractors are willing to take them on and then the client’s desire to have control over the project.

The best way to execute a project is to allocate the risk to the party that can best control the risk. If you step away from that principle, it can create inequalities in the contract.

Fluor is willing to take incentives and penalties where we have full control of the project, i.e., where we have been engaged from the start, we understand the project and have control over the execution phases. In a lot of our projects, we do that, especially using our engineering, procurement, fabrication and construction model.

In projects where we don’t have full control, there are other contractor arrangements that can be used successfully. For example, we are carrying out a project at the moment where we have an integrated project management team that combines the best personnel from both our client’s team and our team. On this project, there are significant performance incentives at the end of the project.

IM: How has the proliferation of automation, electrification and digitalisation impacted your work as an EPC/EPCM provider?

TM: It’s fair to say nobody – our clients especially – want mines coming into service in the 2020s and beyond that use the technology of 10 to 15 years ago. Automation, electrification and digitalisation are all critical to the success of these future projects.

At Fluor, we are investing a great deal in developing our automation and digitalisation expertise. We are working with IBM on several efforts around predictive analytics. We also have a section of the company focused purely on innovation. We are bringing innovative and automated solutions to projects, including some active and passive sensing technologies used to help safeguard personnel in the field and track equipment and materials.

One of the solutions we have developed is Safety Pin, which allows us to know where every worker is and to notify workers of areas that are not safe to enter.

Innovation is a differentiator for us as we have been adopting various innovations on a number of projects. We know what works and what doesn’t. Others talk about innovation without having applied innovations to large-scale projects.

IM: Where is Fluor seeing most demand for its services on a regional and commodity basis?

TM: We have projects globally, including bauxite and diamond projects in Africa, iron ore projects in Australia and gold projects in Mexico. Copper projects in South America are extremely active right now. We are executing a number of projects in South America – Quellaveco and Spence being two of the largest – and are also engaged on a number of other ones.

This article is part of a larger Q&A to be featured in the December print issue of International Mining