Tag Archives: Spence

BHP commits Escondida, Spence and Olympic Dam ops to reaching Copper Mark

BHP has issued a Letter of Commitment to the Copper Mark Responsible Production Framework that will see its Escondida and Spence operations in Chile, plus its Olympic Dam mine in Australia, fall in line with the voluntary program.

The Copper Mark is a credible assurance framework to demonstrate the copper industry’s responsible production practices and contribution to the United Nations Sustainable Development Goals, BHP said. The program is designed to hold the copper industry accountable to responsible practices in critical areas including environment, community, human rights and governance issues, according to BHP Group Sales and Marketing Officer, Michiel Hovers.

“We know that our long-term sustainability credentials are important to our customers and increasingly important to end consumers of copper products, such as buyers of electric vehicles and copper intensive consumer durables,” Hovers said. “The Copper Mark accreditation is an important step in developing an industry-wide approach to transparency and standards for the copper value chain.”

This year, the Oyu Tolgoi mine, in Mongolia, and the Kennecott operation, in the US, were both awarded the Copper Mark. Freeport McMoRan has also pledged to fall in line with the program at six of its operations.

Hovers added: “The Copper Mark is an independent and credible certification, and will further reinforce the value responsible production of the copper products that we sell to our customers.”

BHP has set targets to reduce its emissions by 30% by 2030, along with a goal of net zero emissions by 2050, Hovers said. In Chile, at Escondida, the company is also aiming to operate using 100% renewable power and 100% desalinated water.

“We know that copper is essential to the energy transition, but equally important to our customers, our investors, our employees, our communities, and our stakeholders across the copper value chain is ethical and sustainable production of copper – where production is in line with the UN’s sustainable development goals,” Hovers said.

BHP’s operated copper assets involved in this transition – Escondida, Spence and Olympic Dam – represented 1.5 Mt of copper production in the miner’s 2020 financial year.

BHP weighs trolley assist and IPCC as part of decarbonisation efforts

BHP has provided an update on its progress on climate action, new climate commitments and how it integrates climate change into corporate strategy and portfolio decisions in a new report.

The company’s climate change approach focuses on reducing operational greenhouse gas emissions, investing in low emissions technologies, promoting product stewardship, managing climate-related risk and opportunity, and partnering with others to enhance the global policy and market response, it says.

“BHP supports the aim of the Paris Agreement to limit global warming to well below 2°C above pre-industrial levels, and pursue efforts to limit warming to 1.5°C,” the company clarified.

It explained: “BHP has been active in addressing climate risks for more than two decades, and has already established its long-term goal of achieving net zero operational (Scope 1 and 2) emissions by 2050 and its short-term target of maintaining operational emissions at or below financial year (FY) 2017 levels by FY2022, using carbon offsets as required.”

In the past year, BHP has made progress on this aim, announcing that the Escondida and Spence copper mines in Chile will move to 100% renewable energy by the mid-2020s, and, last week, awarding new renewable energy contracts for its Queensland coal assets, and the world’s first LNG-fuelled Newcastlemax bulk carrier tender.

BHP’s climate change briefing and 2020 climate change report outline how the company will accelerate its own actions and help others to do the same, it said. Today’s update sets out:

  • A medium-term target to reduce operational greenhouse gas emissions by at least 30% from adjusted FY2020 levels by FY2030;
  • Scope 3 actions to contribute to decarbonisation in its value chain. This includes supporting the steelmaking industry to develop technologies and pathways capable of 30% emissions intensity reduction with widespread adoption expected post-2030 and, in terms of transportation, supporting emissions intensity reduction of 40% in BHP-chartered shipping of products;
  • Strengthened linking of executive remuneration to delivery of BHP’s climate plan; and
  • Insight into the performance of BHP’s portfolio in a transition to a 1.5°C scenario.

The report also outlined some examples of emission reduction projects the miner is considering, which will be weighed as part of the maintenance capital category of its capital allocation framework. This includes solar power installations; alternative material movement technologies such as overland conveyors and in-pit crush and convey solutions; and trolley assist to displace diesel for haul trucks.

The company expanded on this in its report: “The path to electrification of mining equipment will likely include solutions such as trolley assist, in-pit crush and convey, overland conveyors and battery solutions.

“Diesel displacement represents a higher risk, higher capital step towards decarbonisation, so a phased approach to execution is proposed with particular emphasis on Minerals Americas-operated assets that are further advanced on the decarbonisation journey. Taking a transitional approach to electrification provides flexibility to allow for the potential for rapid development of emerging technologies and to resolve the complexities of integrating these technologies into existing operations.

“During FY2021, we will seek to collaborate further with International Council on Mining and Metals members, industry and original equipment manufacturers to progress research and development to reduce costs and assess any potential impacts from electrified mining equipment solutions to replace current diesel options.”

BHP Chief Executive Officer, Mike Henry, said of the report: “I’m pleased today to show how we are accelerating our own actions and helping others to do the same in addressing climate change. We see ourselves as accountable to take action. We recognise that our investors, our people and the communities and nations who host our operations or buy our products have increasing expectations of us – and are responsive to these.

“Our approach to climate change is defined by a number of key requirements. Our actions must be of substance. They must be real, tangible actions to drive emissions down. We must focus on what we can control inside our business, and work with others to help them reduce emissions from the things that they control. To create long-term value and returns over generations, we must continue to generate value and returns within the strong portfolio we have today, while shaping our portfolio over time to benefit from the megatrends playing out in the world including decarbonisation and electrification.

“Our portfolio is well positioned to support the transition to a lower carbon world aligned with the Paris Agreement. Our commodities are essential for global economic growth and the world’s ability to transition to and thrive in a low carbon future. Climate change action makes good economic sense for BHP and enables us to create further value.”

Autonomous haulage under review at Escondida, Spence, BHP says

Having approved three more autonomous haulage projects across its iron ore and coal portfolio since late 2019, BHP is now taking aim at its Chile copper operations, with the potential for automated trucks currently being studied at Escondida and Spence, the company says.

Alongside the potential for autonomous trucks, drills are being converted to autonomous operation at Escondida and Spence, according to the company.

The news came within the company’s financial year 2020 results presentation today, which showed BHP generated underlying EBITDA of $22.1 billion and attributable profit of $8 billion over the 12-month period.

Since late 2019, BHP has announced and is implementing three additional autonomous haulage projects at mine sites across its coal and iron ore segments.

At the Daunia coal mine in central Queensland, it announced the introduction of 34 autonomous trucks in July 2020, with the first trucks set to begin operating in February 2021 and the rollout to be completed early in 2022.

At the Newman East (Eastern Ridge) iron ore mine in Western Australia, the first of 20 autonomous trucks began operating in July 2020, with the rollout expected to be completed by the end of this year.

At the Goonyella Riverside mine in Queensland, the first coal site to implement autonomous haul trucks, the deployment of 86 autonomous trucks is expected to be completed early in 2022, it said.

“We will continue to assess the value case for potential expansion of this technology to our other Australian iron ore and coal mine sites,” the company said in the results statement today.

BHP builds its ‘green’ copper credentials at Escondida, Spence

BHP says new renewable energy contracts it has recently signed in Chile will reduce energy prices for its Escondida and Spence copper mines by around 20% and help displace up to 3 Mt/y of CO2 emissions from these operations.

These agreements not only benefit BHP’s business but generate strong environmental and social value, according to Daniel Malchuk, President Operations for BHP’s Minerals Americas business.

BHP operates and own 57.5% of the Escondida mine, a leading producer of copper concentrate and cathodes from a copper porphyry deposit, in the Atacama Desert in northern Chile. Spence, which is 100% owned by BHP, is also in northern Chile.

He said: “Population growth and higher living standards combined with greater electrification are expected to push up demand for copper. This means that copper in products such as electric cars and renewable energy infrastructure, which are vital to the world’s sustainable growth, must be produced to the highest environmental aspirations.”

The new energy contracts, along with BHP’s investment in desalinated water in Chile, demonstrate social value in action and help drive the wider agenda for sustainable green copper, according to Malchuk.

Social value is one strategic pillar the company embeds in all its decision-making and informs the way in which it provides resources and generates long-term, sustainable value. This was the subject of BHP Chief External Affairs Officer, Geoff Healy’s speech in London earlier this month.

Malchuk said the company has negotiated four new power contracts that will meet its energy requirements at Escondida and Spence from 100% renewable energy sources by the mid-2020s.

“When fully operational, these renewable supply arrangements will eliminate virtually all of Escondida and Spence Scope 2 emissions (emissions from purchased energy), effectively displacing up to 3 Mt of CO2 annually compared to the fossil fuel contracts they replace,” he said. “This is the equivalent to annual emissions from about 700,000 combustion engine cars and accounts for around 70% of BHP’s Minerals Americas total greenhouse gas emissions.”

These actions also support Chile’s wider “Energia 2025” power policy target for 20% of all Chilean energy to come from renewable sources by 2025.

Following a competitive tender process, Escondida and Spence agreed separate 15-year contracts for 3 TWh/y and 10-year contracts for 3 TWh/year with ENEL Generación Chile and Colbún respectively. The ENEL contracts will begin in August 2021 and the Colbún contracts in January 2022, BHP said, with power supplied from solar, wind and hydro sources.

Malchuk said: “These contracts are practical examples of our commitment to social value that are linked to a sound business case. We estimate the agreements will reduce energy prices at our Escondida and Spence copper mine operations by around 20%, provide our operations flexibility and security of supply, and strengthen our ability to deliver sustainable copper across our supply chain.”

On top of this, the company has confirmed that its Spence operations will begin using desalinated water as the main source of supply from mid-2020 upon completion of a 1,000 l/s capacity desalination plant. This was part of a plan the company outlined in 2017 to grow the Spence operation.

This is on top of the more than $4 billion, 2,500-l/s desalination plant the company built at Escondida.

Malchuk said: “Water is a precious commodity that is critical to our operations in Chile and to the communities where we operate in the Atacama Desert, one of the driest regions in the world. We recognise our operations have an impact on the environment given the immense amount of water they consume.”

He added: “Our Water Stewardship position statement, launched last month, outlines our vision for a water secure world by 2030. It sets out our actions to improve water management within our operations and contribute to more effective water governance beyond the mine gate.

“We strongly support the UN Sustainable Development Goals on access to clean and affordable water. That’s why we will set public targets and engage industry, communities and governments to improve governance, transparency and collaboration in water management.”

BHP’s Jurgens presents big picture automation plan

Diane Jurgens, BHP’s Chief Technology Officer, used her time on stage at the Bank of America Merrill Lynch SmartMine conference, in London, to highlight the company’s plan to introduce full or partial automation across its entire value chain.

The miner has already introduced automation across many of its operations – from haul trucks at Jimblebar (Western Australia) to drill rigs at Western Australia Iron Ore – but Jurgens said the company has bigger automated plans.

This includes considering opportunities to accelerate truck autonomy across the company’s Australia and Minerals Americas sites – the company previously detailed plans to automate around 500 haul trucks across its Western Australia Iron Ore and Queensland Coal sites – and introducing “Decision Automation” to link autonomous processes and data from different sources together to create “near instantaneous, optimised decision making”, Jurgens said.

While she talked up the use of automation in mining – referencing the experience she has in the automotive and aerospace industries – she admitted full automation across the BHP group was unlikely.

“This is because we automate equipment and processes where it provides the highest value,” she said, explaining that investment in technology competes against all of other projects in the BHP portfolio, “and alternative uses of cash, under BHP’s Capital Allocation Framework”.

To test this, the company has built proving grounds at two active mine sites (Eastern Ridge in Australia and Escondida in Chile) to trial new innovations in geology, extraction and processes, and “develop workforce capability so that our people are equipped for the rapid pace of change that lies ahead”, Jurgens said.

Just some of the new innovations Jurgens mentioned included the use of advanced geophysics modelling to reanalyse existing drilling data. This new approach led, in November last year, to the Oak Dam copper discovery, near its existing Olympic Dam operations in South Australia.

Recently, sensors were installed at the Escondida test grounds to prototype the use of real-time data to analyse the quality and grade of ores and inform, for example, whether to divert unprocessed ore for leaching, to concentrators or waste. Jurgens said: “The key to achieving this is using data collected through the sensors and combining it with proprietary algorithms. We then apply our knowledge of the ore body to optimise the processing methods. Once in production, we expect these to improve throughput performance.”

With access to more detailed data on extracted material, machine algorithms can automate decisions to identify and divert waste, which increases plant performance and reduces processing costs, she added.

New patented leaching technologies have, meanwhile, increased metal recoveries by 10-12% and shortened the processing time by 50%, according to Jurgens. “At Spence in Chile we increased copper recoveries by about 10% and helped offset grade decline through implementing the low-cost Spence Recovery Optimisation project,” she said. “The initiative improved heap leach kinetics which meant we could maximise utilisation of the leach pads and therefore use the full 200,000 t of tankhouse capacity.”

This breakthrough also informed the successful heap leach trial at Olympic Dam, which the company has just completed.

The company’s automation and innovation journey has already resulted in significant wins, according to Jurgens.
Equipment automation is creating more efficient, standardised and safer operations, she said:

  • Autonomous blast hole drills across BHP’s Western Australia Iron Ore assets have increased drill rates by 25%, and reduced monthly drill maintenance costs by over 40%;
  • Haulage automation at the Jimblebar operation, in the Pilbara, has reduced heavy vehicle safety incidents by 80%;
  • Machine learning is being applied to maintenance on trucks in iron ore and coal – to analyse component failure history;
  • At Yandi, haul truck maintenance analytics increased truck availability to above 90% and generated recurrent cost savings. Replicating these strategies to our trucks in energy coal in the Hunter Valley, BHP has also seen an increase in truck availability;
  • Automating key components of BHP’s rail network is supporting increased capacity, more reliable dispatch and improved maintenance outcomes;
  • In Western Australia, material density scanning and laser precision have delivered an additional 2.4 t of iron ore per car while reducing safety risks of overloading;
  • The automated rail network scheduling system, which controls over 10,000 ore cars and transports about 270 Mt/y of iron ore, is becoming more effective through self-learning algorithms, ensuring trains arrive at port, on-time, and;
  • LiDAR technologies are being used to automate the loading of ships that transport BHP’s product to customers around the world.

BHP considering IPCC, autonomous trucks at Spence copper mine

BHP says it is continuing to evaluate materials handling and fleet replenishment options at its Spence copper mine, in Chile, with one possibility being the use of an in-pit crushing and conveying ore system in tandem with autonomous trucks.

In its 2018 annual report, the company said the timing and sequencing of these options was “pertinent” to reducing health and safety risks and operating costs, with “technology-enabled solutions potentially significantly reducing risks associated with crash, collision and rollover, silica exposure, dust and greenhouse gas emissions”.

Spence is a key part of BHP’s copper portfolio in Chile and is due to produce some 185,000-200,000 t of the red metal in the company’s 2019 financial year to end-June.