Tag Archives: Rio Tinto

Turquoise Hill and Rio Tinto sign Oyu Tolgoi UG funding HoA, agree to end arbitration

Turquoise Hill Resources and Rio Tinto have entered into a binding Heads of Agreement (HoA) to provide an updated funding plan for the completion of the Oyu Tolgoi underground copper-gold project in Mongolia.

The funding plan is designed to address the estimated remaining funding requirement of around $2.3 billion and replaces the non-binding Memorandum of Understanding that Rio and Turquoise Hill previously entered into on September 9, 2020.

Under the HoA, subject to securing approval by Oyu Tolgoi LLC, the project joint venture, and any required support from the Government of Mongolia, Turquoise Hill and Rio Tinto will:

  • Pursue re-profiling of existing project debt to better align with the revised mine plan, project timing and cash flows to reduce the currently projected funding requirements of OT by up to $1.4 billion; and
  • Seek to raise up to $500 million in senior supplemental debt (SSD) under the existing project financing arrangements from selected international financial institutions.

In addition, Rio Tinto has committed to address any potential shortfalls from the re-profiling and additional SSD of up to $750 million by providing a senior co-lending facility on the same terms as Oyu Tolgoi’s project financing, while Turquoise Hill has committed to complete an equity offering of up to $500 million.

An updated feasibility study on the underground expansion at Oyu Tolgoi from June 2020 included a delay of 21 to 29 months for first sustainable production compared with the original 2016 feasibility study guidance and an increase of $1.3-$1.8 billion from the original $5.3 billion development capital. The process also saw 1.22 Mt of copper, 850,000 oz of gold and 7.01 Moz of silver removed from the Hugo Dummett North reserve base compared with the December 31, 2019 calculation, with some 80,000 t of copper, 70,000 oz of gold and 550,000 oz of silver added to the Hugo Dummett North Extension reserve base.

Since this announcement, Rio, Turquoise Hill and the Government of Mongolia have been trying to agree on a new funding pact for the sustainable development of the underground operation, which, in combination with open-pit mining, could produce around 500,000 t/y of copper at full capacity.

Steve Thibeault, Interim Chief Executive Officer of Turquoise Hill, said: “We are pleased to have reached a constructive and equitable agreement with Rio Tinto to fund the Oyu Tolgoi underground development. With a binding funding agreement now in place that sets out a process along a known timeline, we will be able to move ahead as expeditiously as possible with the development of the underground project at Oyu Tolgoi.

“We remain committed to continue delivering a benefit to all stakeholders, including Mongolia and its citizens, and to delivering significant long-term value for Turquoise Hill as this project progresses.”

Rio Tinto Copper Chief Executive Bold Baatar, added: “This agreement and alignment with Turquoise Hill represents a major milestone in the continued development of Oyu Tolgoi, which is expected to become one of the world’s largest copper mines and a significant contributor to the Mongolian economy for years to come. Commencing the re-profiling whilst concurrently listening, engaging and resolving the concerns of the Government of Mongolia are critical steps to maintaining momentum on the timely delivery of the Oyu Tolgoi Underground project.”

Following the HoA, Turquoise Hill and Rio have agreed to obtain an order dismissing the current arbitration on a “without prejudice basis” and without costs, including an order vacating the interim measures order, the companies said.

Rio Tinto commences lithium production at Boron mine site in California

Rio Tinto says it has commenced production of battery-grade lithium from waste rock at a lithium demonstration plant at the Boron mine site in California, USA.

The demonstration plant is the next step in scaling up a breakthrough lithium production process developed at Boron, to recover the critical mineral and extract additional value out of waste piles from over 90 years of mining at the operation, it said. An initial small-scale trial in 2019 successfully proved the process of roasting and leaching waste rock to recover high grades of lithium.

The demonstration plant has a design capacity of 10 t/y of battery-grade lithium. It will be run throughout 2021 to optimise the process and inform Rio Tinto’s feasibility assessment for progressing to a production-scale plant with an initial capacity of at least 5,000 t/y, or enough to make batteries for around 70,000 electric vehicles.

Rio Tinto Minerals Chief Executive, Sinead Kaufman, said: “This is a valuable next step in scaling up our production of lithium at the Boron site, all from using waste material without the need for further mining. It shows the innovative thinking we are applying across our business to find new ways to meet the demand for emerging commodities like lithium, which are part of the transition to a low-carbon future.”

Rio Tinto’s lithium pipeline includes the Jadar lithium-borate project in Serbia, for which a feasibility study is expected to complete by the end of 2021.

Development of the lithium project at Boron draws on Rio’s long standing partnership with the US Department of Energy’s Critical Materials Institute (CMI), which is focused on discovering ways to economically recover critical mineral by-products from existing refining and smelting processes. CMI experts worked alongside Rio technical leads to help solve a number of key processing challenges to produce battery grade lithium at Boron, the company said.

CSI to carry out load and haul, drill and blast work at Rio’s Brockman 2 iron ore mine

Mineral Resources Ltd’s CSI Mining Services has been awarded a mining contract by Rio Tinto to carry out work at the Brockman 2 iron ore mine in the Pilbara of Western Australia.

The scope of the contract will see CSI conduct load and haul, drill and blast, and short-term mine planning activities for Rio, the company said.

This will involve scheduling, drilling and blasting and then excavating 27 Mt of waste rock and iron ore over an approximate nine-month period, with a fleet of large-scale mining equipment, developing the Lens A/B pit for Rio.

This contract builds on a 16-year relationship with Rio, dating back to when CSI first commenced crushing services at the Nammuldi mine site. It also follows the completion of a 30 Mt load and haul contract at Rio’s Tom Price mine. CSI remains engaged at another Rio Tinto operation, Paraburdoo, where its team is carrying out 13 Mt of load and haul operations.

The Brockman 2 contract will generate around 150 jobs for CSI’s highly skilled workforce, the company said.

Mineral Resources’ Chief Executive Mining Services, Mike Grey, said: “We are delighted to have been invited by Rio Tinto to assist at another of its world-class iron ore mines. Our relationship with Rio Tinto dates back 16 years. Since then, we have been able to establish a track record of consistent project delivery for Rio Tinto, which we are very proud of.

“CSI is the world’s largest crushing contractor, so it is immensely satisfying that this latest Rio Tinto contract includes other mining activities, such as load and haul and drill and blast, to demonstrate CSI’s diverse skills set. We are confident this Brockman 2 scope of work will become the latest chapter of our ongoing association with Rio Tinto.”

Brockman 2 is one of the 16 mines that make up Rio’s world-class Pilbara iron ore operations.

The CSI team has begun mobilising to site, including delivering a new fleet of Komatsu 830E electric-drive dump trucks and a new Komatsu PC4000-11 excavator.

Rio Tinto Japan joins GVC Network as part of carbon footprint reduction plan

Rio Tinto Japan has joined Japan’s Green Value Chain Platform Network (GVC Network), a collaboration established by the Ministry of the Environment to lead transparent decarbonisation efforts in the country.

Representative Director and Rio Tinto Japan President, Bill Horie, said: “We are honoured to be welcomed into the Ministry of Environment’s GVC Network and look forward to engaging on innovative approaches with customers, government and industry to help reduce Japan’s carbon footprint.”

Formed in 2018, GVC Network member companies work to set science-based targets for emissions reduction that are economically feasible and effective for the achievement of their Scope 1, 2 and 3 targets; and to share solutions related to renewable energy, energy conservation, or energy storage, Rio said.

Rio Tinto aims to reach net zero emissions across its operations by 2050. Its efforts to support decarbonisation through state-of-the-art solutions such as START Responsible Aluminium – a leading traceability program – aligns with the GVC Network intentions, the company added.

The GVC Network collaborates formally through networking and has 141 members representing a variety of industries including: electronics, machinery and equipment, automotive, airline, pharmaceutical, chemical, cosmetics, building and construction, real estate, housing, printing, food and beverage, marine, retailing, publishing and logistics.

To help reach net zero emissions across its operations by 2050, Rio Tinto is targeting a reduction in emissions intensity by 30% and in its absolute emissions by 15%, both by 2030 and from 2018 levels. The company also plans to spend around $1 billion over five years on emissions reduction projects, research and development and activities to enhance the climate resilience of our business.

Rio Tinto has outlined a series of measurable and impactful Scope 3 emissions reduction goals to guide its approach, which features partnerships across China, Japan and South Korea – countries which account for 88% of the company’s value chain emissions (Scope 3).

The company has also committed that its growth over the next decade will be carbon neutral.

Techking custom-made tyres hit the ground at Rio Tinto WA operations

Equipped with Techking custom-made tyres 23.5R25 ETD2S, XCMG XC958 front-end loaders have arrived at Rio Tinto’s operations in Western Australia to begin transporting ore to cargo ships.

To gather user feedback on these tyres, Techking Australia branch business employee, Steve Coles, made a recent site visit.

The tyre model is specially designed for XCMG XC9 series high-end loaders to undertake ore transportation tasks. By adopting proprietary formula and chevron patterns, these custom-made tyres dramatically improve performance in cut resistance and overall sidewall strength, achieving a longer life cycle under special working conditions.

Allen Zhuo, an XCMG Field Service Engineer, told Coles that the Techking tyres and XCMG loaders had been put into use at Rio Tinto’s operations and were, at present, working well.

The delivery of customised tyres for XCMG loaders marks the second time Techking has rendered tailored tyre services to two international giants.

“This is another milestone made towards Techking’s goal of becoming a leading global tyre solution supplier for large mining machinery,” the China-based company said.

While Coles was visiting Rio Tinto, a test report with satisfactory results was received regarding the 27.00R49 SUPER ROCK tyres. These tyres were customised for Komatsu 785 rigid dump trucks working at a Rio Tinto copper mine in Mongolia.

“It is shown from the tracking data in March that the 27.00R49 SUPER ROCK tyres have reached an average service life of 4,201 hours to date and could go beyond Rio Tinto’s expectation by reaching an estimated service life of 10,406 hours,” the Techking field service engineers’ report read.

Hastings Deering rebuild program pays off for Rio Tinto’s Gove operation

Hastings Deering has been sustain output at Rio Tinto’s Gove bauxite open-pit operation in the Northern Territory of Australia by boosting engine power during the rebuild of dozers.

The Cat D11T dozer is purpose built to move more material and ensure maximum availability through its planned life cycle, the Caterpillar dealer says. For Rio Tinto, Dozer 79, had built up over 37,000 hours ripping and pushing bauxite at its open-pit operation.

Rio Tinto knew it wanted to undergo a Cat Certified Rebuild for its dozer but had to come up with an innovate way to do this while minimising equipment down time, Hastings Deering said.

Brendan Coleing, Superintendent, Mining Maintenance, said the Gove operation has focused heavily on building safe and reliable machinery to meet the targeted life of its assets and maintenance schedules.

“With a 24/7 operation, we need to plan and strategically think about our assets, their maintenance and lifecycle,” he said. “By planning large maintenance projects in advance, at Rio Tinto, we’ve been able to compensate for machinery downtime and achieve some great energy efficiencies.”

One of the key projects that helped to allow for the nine-week Cat Certified Rebuild (CCR) was the D11R repower project.

In early 2020, the Hastings Deering team worked with Rio Tinto on an alternative solution for engine replacement in its D11R fleet that reduced costs, fuel use and emissions while extending lifespans. This incorporated replacing the 3508 engines the machines originally came with, with the newer C32 engines.

“Recent success with repowering our D11 fleet with C32 engines has helped our mining operations move more bauxite due to increased power in the machine,” Coleing states. “This in turn allowed us to remove Dozer 79 out of production, and into the workshop to complete a Cat Certified Rebuild.”

Alongside the increase in machine availability, this project presented a budgeted fuel burn reduction of up to 25%.

“Our like-for-like material movements are now done with significantly less fuel which is a great environmental outcome,” Coleing said. “They’re also quieter, making them a little more comfortable for the operator.”

With Cat equipment built to perform over multiple lifetimes, the CCR was the most efficient way to help get the most economic value out of the original asset investment.

A CCR is a full machine rebuild that provides a like-new machine, inclusive of all Cat updates, to help achieve a full machine life supported by the Caterpillar warranty, Hastings Deering says.

Brad Read, Service Manager at Hastings Deering, said the CCR program is an efficient way for customers to improve the planned lifecycle of their machines.

“Given Dozer 79’s upcoming power train, hydraulic and major component change outs, a CCR was a cost-effective way for us to maintain the asset through to the end of its target life,” he said. “Customers opt for a CCR as it provides the ability to rebuild their machine, including all technological advancements, over purchasing a new machine. This helps to reduce capital expenditure.”

Read said that the CCR offered an extended scope or work over a standard rebuild and took careful planning between the Rio Tinto and Hastings Deering teams.

“The CCR takes up to nine weeks to complete and covers an extended scope of work including power train replacement, hydraulics and electrical components, cab overhaul, work implement overhaul and ET testing and painting,” he said.

“Effective planning is critical to the success of a large-scale project like a CCR. The team needs to ensure all stages of the rebuild have been planned, scheduled and are on time to guarantee machine delivery back to the customer.”

“It is essential to support our customers in their operation.”

By successfully planning the CCR after the success of the C32 repower project, Rio Tinto and Hastings Deering were able to improve the performance of its equipment and compensate for the removal of Dozer 79, Hastings Deering said.

Coleing said: “By undertaking work in this manner, we’ve removed a massive amount of forward log of work that not only gave us immediate availability but provided us with an improved asset through to the end of the machine life.”

Rio Tinto investigates Heliogen’s AI-backed solar technology to decarbonise Boron ops

Rio Tinto and renewable energy technology company, Heliogen, have announced an agreement to explore the deployment of Heliogen’s solar technology at Rio Tinto’s borates mine in Boron, California.

Under a memorandum of understanding, Heliogen will deploy its proprietary, artificial intelligence (AI)-powered technology at the Boron operation, where it will use heat from the sun to generate and store carbon-free energy to power the mine’s industrial processes.

The two companies will begin detailed planning and securing government permits for the project, with the aim of starting operations from 2022. They will also use the Boron installation to begin exploring the potential for deployments of Heliogen’s technology at Rio Tinto’s other operations around the world to supply process heat, which accounted for 14% of Scope 1 & 2 emissions from the group’s managed operations in 2020.

Heliogen’s high-temperature solar technology is designed to cost-effectively replace fossil fuels with sunlight for a range of industrial processes, including those used in mining. At Rio Tinto’s Boron mine, the company’s proprietary technology will use AI to control a network of mirrors that concentrate sunlight to capture energy used to make steam, the companies said. Heliogen’s system will also store the captured energy in the form of heat, allowing it to power night-time operations and provide the same uninterrupted energy stream offered by legacy fuels.

The Boron operation mines and refines borates into products ranging from fertilisers to construction materials and is producing lithium carbonate from a demonstration plant. The site currently generates steam using a natural gas co-generation plant and natural gas fired boilers. Heliogen’s installation will supplement these energy sources by generating up to 35,000 pounds per hour (15.9 t/h) of steam to power operations, with the potential to reduce carbon emissions at the Boron site by around 7% – equivalent to taking more than 5,000 cars off the road. Rio Tinto will also be assessing the potential for larger scale use of the Heliogen technology at Boron to reduce the site’s carbon footprint by up to 24%.

Heliogen’s mission of slashing global carbon emissions by replacing fossil fuels with sunlight, as well as its focus on industrial sectors, made it an ideal partner for Rio Tinto, which is committed to decarbonising its global operations, it said.

Rio Tinto Chief Executive, Jakob Stausholm, said: “This partnership with Heliogen has the potential to significantly reduce our emissions at Boron by using this ground-breaking solar technology, and we look forward to exploring opportunities across our global portfolio.

“Addressing climate change effectively will require businesses, governments and society to work together through partnerships like this one, to explore innovative new solutions throughout the entire value chain. Our work with Heliogen is part of Rio Tinto’s commitment to spend approximately $1 billion on emissions reduction initiatives through to 2025 and our commitment to work with world-leading technology providers to achieve this goal.”

Heliogen CEO and Founder, Bill Gross, said: “Since its founding, Heliogen has been laser-focused on decarbonising industrial sectors, including mining. As a result, this agreement with Rio Tinto is incredibly gratifying.

“We’re pleased to find a partner committed to cutting its contributions to climate change. We’re also pleased that Rio Tinto is exploring our technology to play an important role in helping reach its sustainability goals while dramatically reducing its energy costs. More broadly, we’re excited to take this important step as we pursue Heliogen’s goal of avoiding more than 1 gigaton of CO2 emissions – 5% of the world’s annual total – from the global economy by turning sunlight into an industrial energy source.”

Vuzix Smart Glasses keep Rio global teams connected at Oyu Tolgoi Underground

Rio Tinto has deployed Vuzix Smart Glasses at the Oyu Tolgoi copper-gold mine in Mongolia to continue progressing the development of the underground project in the face of travel restrictions tied to COVID-19.

Vuzik, a supplier of smart glasses and augmented reality technology and products, says the company is using its smart glasses to enable technical experts from all over the world to work with local teams on the underground project.

Rio, in its 2020 Annual Report, said it had been increasing its use of drones and mine pit cameras, and introduced video headsets (including smart glasses) to conduct visual inspections of tailings facilities and equipment while complying with travel restrictions and physical distance requirements.

“Vuzix Smart Glasses usage continues to expand across an ever-widening array of industry verticals,” Paul Travers, Vuzix President and Chief Executive Officer, said. “Companies like Rio Tinto, which is a global leader in its field, continue to provide validation of the value and effectiveness of our products in real world situations.”

XCMG custom graders get to work at Rio Tinto Western Australia mines

XCMG says it has delivered six customised GR2605 graders to Rio Tinto, which have recently been put into operation at the company’s mines in Western Australia.

The model, specifically customised for Rio Tinto, is a super-horsepower grader with enhancements in terms of safety, functionality and design to meet Rio’s given needs and cope with local working conditions, the manufacturer said.

XCMG set up an elite project team to take charge of the R&D, manufacturing and quality control of the customisation project, and devoted a year to survey and analyse construction conditions and the client’s demands.

“The project team has made breakthroughs in a series of core technologies such as double-handle electronic control, regional environmental monitoring, machinery status electronic monitoring and more,” Wang Min, Chairman of XCMG, said. “Our comprehensive customisation service not only provides the ideal products to our clients, but also put XCMG on a firmer footing in the global market.”

From setting up the project to final delivery, XCMG conducted nearly 100 upgrades and optimisations in accordance with Rio’s requirements and the working conditions along the railways in Western Australia where they will be used. Much of this focused on improving the safety designs and operator friendliness, including:

  • A mechanical blade safety lock system;
  • Trimark locking system to prevent accidental opening of the engine hood;
  • Adjusted filter and storage battery position for easy troubleshooting and maintenance;
  • New pin bolt system to eliminate suspension loading risks;
  • Spare parts safety system featuring wheeled platform for bucket tooth for safety checkup; and
  • More ergonomic, quick refuelling design.

Prior to the delivery, XCMG provided comprehensive product use and maintenance training to ensure a smooth transitioning to operating the equipment, it said.

Wang Min added: “Taking this collaboration as an opportunity, XCMG will continue to strengthen our independent innovation and move steadily into the high-end markets. We thrive to meet the customers’ needs and create more possibilities by improving the product quality and perfecting the services.”

Back in September, a ceremony marking an XCMG Grader GR2605 fleet delivery and GR5505 Mining Grader Project Commencement Ceremony for Rio Tinto was held at XCMG’s intelligent grader manufacturing base in Xuzhou.

DDH1 drilling contractor debuts on ASX after stellar IPO

DDH1 Ltd has officially commenced trading on the Australian Securities Exchange following an initial public offering last week that saw the drilling contractor secure gross proceeds of A$150 million ($115 million) through the issue of around 40% of its shares.

The IPO proceeds were used to allow existing shareholders to realise part of their investment in the company and to repay company borrowings, the company said. The IPO was one of the largest by a Western Australia-based business in the past decade, according to DDH1.

“The ASX listing marks a significant milestone in the evolution of DDH1, which was established in Perth in 2006 with the vision to create Australia’s premier mineral drilling contractor,” the company said. “Over time, DDH1 has earned the custom of Australia’s premier mining companies through its repeated and meticulous service offering of gathering the critical geological data that supports the decision making in respect of all mining activity through the complete cycle of a mine’s life.”

DDH1 has a portfolio of approximately 102 clients, with a financial year 2020 pro-forma revenue of A$249.8 million. Its earnings are diversified across multiple commodities and geographies, with a client base that includes Newcrest Mining, BHP, Evolution Mining, Gold Fields, Independence Group, Kalgoorlie Consolidated Gold Mines, Newmont Corp, Ramelius Resources, Rio Tinto, Roy Hill Iron Ore and St Barbara.

It offers both surface and underground drilling services, with diamond coring and reverse circulation rigs on offer.

Sy Van Dyk, DDH1’s Managing Director and CEO, said: “The growth and success of DDH1 to date is testament to the commitment of the whole team, which strives to ensure the safety of all stakeholders while delivering exceptional service to our clients.

“Our long-term client relationships are built on the provision of quality drilling services and a deep understanding of our client’s business needs. The company’s significant market position reinforces the strong levels of industry recognition.”

He concluded: “There is growing demand in the Australian mineral drilling sector for DDH1’s services because of increased exploration, development and production spending by minerals exploration and mining companies. As an ASX-listed company with a strong balance sheet, a committed shareholder base, a disciplined approach to growth and access to capital markets, DDH1 is well positioned to pursue its growth strategy.”