Tag Archives: Swick Mining Services

Swick to start testing prototype fully-electric mobile diamond drill rig in October

A prototype of Swick Mining Services’ Gen3 E-Rig, the first fully-electric mobile diamond drill rig in the global market Swick says, will soon start testing at a mine site in Western Australia, the ASX-listed contractor reported in its financial year 2021 results.

The company recently established the Future of Drilling ‘Futures’ department to provide clients with “significant ESG (environmental, social and governance) solutions to lower the carbon footprint of drilling and improve safety through automation”.

As part of the division, the company has been building its Gen3 E-Rig, set to reduce the carbon footprint of underground core drilling by around 50% per metre drilled, Swick says.

Swick says the first prototype is set to be tested at a client’s site in Western Australia in October, with the fully proven electric rig set to be available for Swick’s engineering department to “construct in volumes” by the start of its 2023 financial year.

Swick’s Futures department is also developing a remote control drilling (RCD) system to allow drillers to operate rigs remotely through video-linked controls from surface effectively and safely for up to “24 hours a day of productive time”.

The key inputs of the RCD program are automation, surface to underground high speed communication and semi-autonomous rod handling.

The automation software developed in-house has been delivered and optimised during the company’s 2021 financial year and is now ready for application, it says. “Communication architecture” is now available from third parties, leaving the semi-autonomous rod handling as the last key system design to work on.

“Although the benefits of RCD are evident, Swick expects the implementation of RCD to ramp up over time as the mines get deeper and non-productive time increases and the working environments get more challenging for personnel due to temperature gradients at depth,” it said.

Orexplore and St Barbara agree on GeoCore X10 core scanning contract deferral

Swick Mining Services says its Mineral Technology Business, Orexplore, is pushing back the delivery of its first in-field commercial agreement with St Barbara Ltd at the Gwalia mine in Leonora, Western Australia, following discussions with the gold miner.

The contractor announced back in August that it would scan some 1,500 m/mth of core over a six-month period at the Gwalia mine, conducting technical assessment over a number of potential benefits of the detailed core analysis and a high volume of quality data generated by the GeoCore X10 instrument. It was expecting to mobilise the GeoCore X10 shortly after a formal contract was signed.

In an update on Friday, the company said: “Following discussions with the client, and due to their operational priorities, it has been agreed that the contract will be deferred to financial year 2022.”

This decision has also had an impact on Swick’s planned demerger of the Orexplore business, with the ASX-listed company now saying it will defer the transaction “to allow greater time to seed the commercialisation pathway with initial commercial projects”.

It added: “Swick considers securing commercial projects is a key step in developing a clear pathway for the commercialisation of Orexplore’s technology, and therefore for a successful demerger.”

As a result of the deferral of the demerger, Jason Marinko has resigned from the recently created Managing Director role. Marinko will leave the business effective mid-February and Kent Swick, Managing Director of Swick Mining, will lead Orexplore as it works towards a demerger.

Swick Mining Services goes all-in on underground drilling

Swick Mining Services has decided to sell its surface drilling business and concentrate on underground mining in a move Managing Director, Kent Swick, says is a logical step for the company “aligned with our strategy”.

The Surface Reverse Circulation (RC) Drilling business is being sold to K-Drill Pty Ltd and K-Drill Equipment Pty Ltd.

The sale includes six surface RC rigs, associated equipment, inventory, personnel and contracts, with the transaction expected to complete in the March quarter of 2021.

Including the recent sale of a number of residual RC assets to other parties, Swick will receive total proceeds for its RC business and assets of around A$6.4 million ($4.8 million) in cash and will report a profit on sale of some A$1.2 million before tax, it said.

K-Drill is a new RC drilling company that will be specialising in providing high quality, safe and productive drilling solutions to the Australian mining industry, Swick said. It will be building on the foundations set by Swick and will be led by Managing Director, Brendan O’Shea, who is Swick’s current Business Development Manager.

The Surface RC Drilling business provides reserve definition and exploration drilling to clients and its sale enables Swick to focus on its core Underground Diamond (UD) Drilling business; a 70-rig fleet providing reserve definition and grade control drilling at producing mines. This business represents 96% of annual revenue, Swick says.

O’Shea said: “This opportunity will allow K-Drill to focus completely on surface drilling and we are pleased to provide clients with peace of mind in knowing that we will be bringing all current Swick RC employees and Swick’s existing robust operating systems to K-Drill, ensuring a smooth transition for existing clients.”

After the disposal of the RC division, Swick’s drilling revenue will be generated entirely by the company’s UD Drilling division. This division drills around 100,000 m/mth of core across four countries – Australia, USA, Portugal and Spain. It is on track to deliver a forecasted revenue of A$68-$70 million, with utilisation remaining strong with 13 rigs operating internationally, 25 in Western Australia (including two DeepEX rigs) and 20 across the rest of Australia in December 2020.

On top of the Surface RC drilling business sale, and in response to increased market demand, Swick has agreed to manufacture and sell its “world-class” GenII mobile drill rigs, it said. These rigs are the smallest footprint, but highest-powered mobile drill available on the market, according to Swick, with many unique features including a “world-class automation package”.

Four GenII rigs are currently under construction for two large global drilling contractors for use outside of Australia, Swick said.

In response to increased demand for drill rigs from both Swick’s in-house drilling division and expected interest by external customers, Swick is gearing up its engineering facility at its South Guildford, Western Australia headquarters, to meet this demand, it said.

Swick Engineering has appointed an experienced senior mechanical engineer for the role of Production Manger that will manage the engineering business and oversee the efficient builds and rebuilds of the GenII drills.

Jason Marinko to lead new Orexplore Technologies business

Swick Mining Services has appointed Jason Marinko as Managing Director of Swick’s Mineral Technology Business as a key step along the pathway to demerge Swick’s Drilling Business and Mineral Technology Business, the latter of which will operate under the new company name of Orexplore Technologies Ltd.

Marinko is an experienced public company CEO, Chairman and Company Director, with expertise in the technology and investment banking industries and a proven track record in leading technologies to commercialisation, Swick says. This includes a stint as Executive Chairman of geospatial imagery company Spookfish, where he oversaw its ASX-listing and growth before leading negotiations with North America’s largest aerial imagery and data analytics company, EagleView Technologies Inc, that resulted in a successful takeover of Spookfish.

He also has extensive corporate finance experience as associate director at Perth-based firms Azure Capital and Euroz Securities.

Marinko complements Orexplore’s highly credible management team, which has expert capabilities covering the whole breadth of the business from theoretical physics, manufacturing, software engineering to operations, the company says.

Swick Managing Director, Kent Swick, said: “We are extremely pleased to announce Jason as Managing Director of Orexplore Technologies. I believe the wealth of experience that he brings in managing listed companies, combined with his extensive technology and financial expertise both in Australia and overseas, will provide significant benefits to Orexplore as it moves to demerge from Swick and beyond.

“Swick has made significant progress along the Orexplore journey since our first investment in 2013 initially funding R&D, consolidating the ownership to 100% in 2017 and continuing to support Orexplore to develop the technology it has today. Orexplore is progressing its commercialisation pathway and can now move to address a large potential market for the product. I am confident Jason will be able to navigate the opportunity that lies ahead and look forward to working alongside him.”

Marinko commented: “I am excited to be leading Orexplore’s highly talented team in Australia and Sweden into the next stage of its growth. A decade of pioneering research, development and investment in Orexplore’s unique and disruptive technology that enables fast, accurate, three dimensional non-destructive core analysis has created significant opportunities in the brownfield drilling market that are ready to be realised and I look forward to driving its commercialisation and delivering value to Swick shareholders.”

Commercialisation of Orexplore has gathered momentum with an agreement secured in August 2020 with St Barbara Limited. Under this agreement, approximately 1,500 m/mth of core will be scanned over a six-month period at the Gwalia mine in Leonora, for a total value of approximately A$700,000 ($505,724). The GeoCore X10 instruments will be mobilised to site during this month, with Orexplore Technologies working towards ensuring the value is extracted from the rich 3D data set and adding long-term value beyond the initial six-month period, it said.

Swick Mining working on drilling and technology business demerger

Swick Mining Services says it is working towards a demerger of its drilling and mineral technology businesses following a strategic review.

The announcement came at the same time as the ASX-listed METS firm revealed Drilling Business revenue and EBITDA results of A$149.6 million ($111 million) and A$24.6 million, respectively, for its 2020 financial year. A 9% increase in underground metres drilled saw the company beat its 2019 financial revenue total of A$142.9 million, while the impacts of COVID-19 and ramp-up costs at the Pogo mine contract (Northern Star Resources) saw EBITDA drop from A$28.2 million in the previous financial year.

During this period, the company’s deep exploration division launched new DeepEX rigs, which Swick says are the world’s most powerful underground mobile rigs with capacities to drill exploration holes up to 3,000 m of NQ2 core. Two DeepEX hybrid rigs are currently deployed at client sites, it said.

And the company successfully completed on-site trials of its Orexplore technology, the major technology underpinning its mineral technology business.

These site-based trials were undertaken at Sandfire Resources’ DeGrussa copper-gold mine, in Australia, for a three-month pilot project and at Sweden-based mining and smelting company Boliden for a five-month paid pilot project.

“The first trial at the DeGrussa mine resulted in approximately 9,000 m of core scanned in total, generating 20 TB of 3D data – the largest and most continuous dataset of its kind in the world for a single mine site,” Swick said. “With the trial complete, Orexplore has engaged two world-class subject matter experts to assist Sandfire and other potential clients understand the benefits of a comprehensive Orexplore data set.”

Earlier this month, Swick said Orexplore had been awarded its first in-field commercial agreement with St Barbara Ltd at the Gwalia mine in Leonora, Western Australia.

Despite these wins over the last year-and-a-bit, the company said a strategic review had recommended the company carried out a demerger of the Drilling Business and the Mineral Technology Business.

This could be tied to the fact that, at a group level, Swick reported a net loss after tax of A$6 million in the 2020 financial year, which, it said, reflected the lower Drilling Business earnings and ongoing investment in the company’s Mineral Technology Business, Orexplore.

Swick Managing Director, Kent Swick, said: “Financial year 2020 has presented a unique and challenging set of circumstances with the onset of the COVID-19 pandemic. The business has quickly adapted during this difficult period, ensuring we maintained continuity of operations and protected our people on site both internationally and locally.

“I am pleased with the ability of our Drilling Business to deliver robust earnings in this environment and secure new work with existing clients, including our two largest contracts for Northern Star and BHP, which provide a strong platform for the business as we enter the 2021 financial year.

“Meanwhile, our efforts in the Mineral Technology Business are starting to show value, with successful site-based, paid trials in the year for our Orexplore technology and the award of our first ever in-field commercial agreement earlier this month.

“We have a clear strategy for these two businesses and are now progressing with the outcome of our strategic review to demerge the Drilling Business and the Mineral Technology Business to allow them to pursue their respective strategies and ultimately deliver the greatest value to Swick shareholders.

“Meanwhile, Swick is in a strong financial position, with gearing excluding AASB16 lease liabilities reduced to A10.6 per cent in the year. Swick has A$12.7 million cash and A$18.5 million in undrawn facilities, providing the liquidity that has enabled us to win and deliver on new work, invest in new technologies including DeepEX and Orexplore, and continue providing value for shareholders in these uncertain times through dividends and share buybacks.”

Swick signs BHP, MATSA drilling contracts and inks first Orexplore commercial pact

Swick Mining Services Limited has secured new drilling contracts with BHP’s Olympic Dam mine and MATSA’s copper operation in Spain at the same time as confirming the first commercial agreement for its Mineral Technology Business.

In what will be Swick’s second largest project, the company has been awarded a five-year contract to provide underground drilling services at Olympic Dam mine in South Australia.

Swick has been working with up to five rigs at Olympic Dam since 2017 when an initial trial of its underground mobile diamond drills commenced.

The new contract will see Swick increase its rig volume at site, with the first year’s scope requiring an initial eight rigs, with five to be added to the three currently operating at site. Of the five additional rigs, three are at site already and the remainder will be mobilised from Swick’s existing fleet, according to Swick.

Swick has also been awarded a five-year contract from Minas de Aguas Teñidas SAU (MATSA) at its copper operations in Spain, where two rigs are currently deployed.

These projects, combined with Swick’s existing work in hand, has expanded Swick’s order book to A$363 million ($260 million), it said.

Swick’s Mineral Technology Business, Orexplore, has also been awarded its first infield commercial agreement, the company said.

Under the agreement with St Barbara Ltd, some 1,500 m of core will be scanned per month over a six-month period at the Gwalia mine in Leonora, Western Australia.

Swick will conduct technical assessment over a number of potential benefits of the detailed core analysis and high volume of quality data generated by the GeoCore X10 instrument, it said. The agreement has a value of around A$700,000 over the six-month period.

“Orexplore will be working with world-class subject matter experts to ensure maximum value for the client is derived from the data obtained to develop a compelling justification for ongoing services beyond the initial six-month period,” it said.

Swick expects a formal contract to be signed in the coming weeks and mobilisation of GeoCore X10 instruments housed in a custom-built mobile laboratory to site in September 2020.

The GeoCore X10 analyses the element concentrations and minerals contained in a drill core, as well as providing a visualisation of the rock’s internal structure in 3D. This speeds up the chemical laboratory analysis process, enabling miners to accelerate their own decision making.

Swick Managing Director, Kent Swick, said the company was delighted to be awarded a long-term contract with BHP at Olympic Dam.

“Credit goes to our operational team who have delivered outstanding safety performance, and high quality and productive drilling that enabled Swick to secure this long term, high volume work,” he said.

“In addition, securing a five-year agreement with a large copper miner MATSA, in Spain, adds to our ongoing work with Somincor in Portugal along the historic Iberian Pyrite Belt. Our local workforce in that region is highly skilled and they are to be commended for converting a trial into a long-term contract in Spain.”

He concluded: “In the Mineral Technology Business, it is very exciting that we have taken a significant step forward with the award of Orexplore’s first infield commercial agreement. We look forward to ensuring the value is extracted from this rich 3D data set and I am confident we can add significant long-term value to the Gwalia mine and the wider brownfield market.”

Swick’s Orexplore mineral scanning tech ready for first mine site trial

In announcing the appointment of John Pizimolas as General Manager of the APAC region for Orexplore, Swick Mining Services has revealed that the first mine site trial of its mineral scanning technology is scheduled for the December quarter.

Since launching in May 2018, 18 different customers have used Orexplore in laboratory trials, according to the company.

Pizimolas, meanwhile, has more than 20 years’ experience as a metallurgical engineer in the resources industry, with senior executive expertise in leading mineral analysis across the full mine project life cycle and in new technology start‐ups, Swick said.

Prior to joining Swick, Pizimolas was Vice President, Minerals South East Asia and Pacific for SGS SA and, before then, General Manager Mine Site Services (Global) for ASX‐listed ALS Limited.

Swick Managing Director, Kent Swick, said Pizimolas’ expert industry knowledge will help drive Orexplore’s growth as it targets revenue generation in its second full year since launch.

Pizimolas said: “I strongly believe in the power of digital core tomographic imaging and the need to progress to more real-time information from drilling than has previously been available. The innovative Orexplore technology certainly delivers real commercial value and I am excited to be leading the business in driving its next phase of growth.”

Swick said the Orexplore business is transitioning towards capturing long term, in‐field digital core tomographic imaging opportunities, with the first mine site trial aimed for the December quarter. To support this field trial, Orexplore has recently taken delivery in Australia of three new specification GeoCore X10 machines (pictured) from its Stockholm facility, capable of imaging 6,000 m/mth of core.

The company said: “Successful completion of this trial is expected to enhance market confidence in the technology and drive revenue growth in Orexplore’s second full year since launch.”

Orexplore was developed over a seven-year period in Sweden and provides real-time, non-destructive assay and tomography results using whole of core data that is an improvement on the multiple weeks delay currently used in destructive chemical testing, according to Swick.

GeoCore X10 core scanning machines use patented attenuation and X-ray fluorescence combined measurement techniques to enhance the identification and understanding of key features within the entire core including:

  • Geochemical composition and mineralogy;
  • 3D structures;
  • Texture, fabric and grain size;
  • Density; and
  • Controls on mineralisation.

The scan results are made available to the client for viewing and analysis through Orexplore’s Insight software. This enables interactive 3D manipulation of the tomography data which can lead to accurate definition of geological structures, the ability to define lithological contacts and the true boundaries of mineralisation. It also provides element concentration data for further analysis.

Swick lays groundwork for growth with A$15 million financing

Australia-based drilling and mineral analysis service contractor Swick Mining Services is planning to raise A$15 million ($10.2 million) to provide it with the flexibility to pursue future organic and inorganic growth opportunities for the business, Managing Director Kent Swick says.

The ASX-listed company plans to issue shares to new and existing shareholders to raise this cash and has also provided existing shareholders with an opportunity to raise an additional A$2 million as part of its share purchase plan.

Kent Swick said: “By delivering on our strategy Swick is well placed for growth in financial year 2020, underpinned by our strong order book. We are also seeing additional opportunities to increase our rig fleet utilisation both in Australia and abroad, with a target of 70 FTE (full-time equivalent) underground rigs in work by financial year end, up from an average of 53.6 in FY19.

“This additional funding ensures Swick has the financial flexibility to pursue future organic and inorganic growth opportunities for the business. We are grateful for the strong support received from our existing institutional shareholders and are pleased to welcome several new institutional holders on to our share register.”

In June, Swick said it had recently won drilling contracts with the Barrick Gold and Newmont Goldcorp-owned Nevada Gold Mines JV, Silver Lake Resources and Northern Star Resources.

Swick Mining to drill deeper with new exploration division

Buoyed by a strong set of financial results for the September quarter, mineral drilling contractor Swick Mining Services is making plans to launch a deep exploration division.

The company’s Managing Director Kent Swick said the creation of this unit would “further strengthen the company’s market-leading position” in underground diamond coring.

The announcement came at the same time as the company revealed its September quarter financial results, which included revenue of A$36.7 million ($26 million, up 1% year-on-year), EBITDA of A$6.8 million (up 93% year-on-year), total metres drilled of 297,904 m and an average fleet utilisation of 75% across the quarter.

Kent Swick said: “During the quarter, we ordered some specialised deep-hole drilling kits that will be the most powerful rigs available in the Australian market.

“We expect our specialist team, with its purpose‐built equipment, to deliver great outcomes for our clients who in general are requesting more deep exploration holes to be drilled from underground.”

The company added in its results that demand for underground mobile rigs continues to remain high, while its surface RC drilling division had experienced a rebound.

Orexplore

A first for Swick’s Orexplore scanning tech

Swick Mining Services has signed the first commercial agreement for its Orexplore mineral scanning technology.

The agreement, between Swick’s fully-owned subsidiary Orexplore Australia and exploration company Saturn Metals, has already led to the first batch of 30m of core from Saturn’s Apollo Hill gold project in Western Australia being processed by the patented GeoCore X10 scanning machine and technology.

The Apollo Hill gold project is made up of nearly 1,000km² of ground near Leonora in the Goldfields region.

Swick Managing Director Kent Swick said, although small in value, the agreement was a major milestone for the Orexplore technology.

“This deal comes barely two months after Swick officially launched the Orexplore mineral analysis technology in Australia and is a major step towards commercialisation of this world-first technology.”

Orexplore was developed over a seven-year period in Sweden and provides real-time, non-destructive assay and tomography results using whole of core data that is an improvement on the multiple weeks delay currently used in destructive chemical testing, according to Swick.

GeoCore X10 core scanning machines use patented attenuation and x-ray fluorescence combined measurement techniques to enhance the identification and understanding of key features within the entire core including:

• Geochemical composition and mineralogy
• 3D structures
• Texture, fabric and grain size
• Density
• Controls on mineralisation.

The scan results are made available to the client for viewing and analysis through Orexplore’s Insight software. This enables interactive 3D manipulation of the tomography data which can lead to accurate definition of geological structures, the ability to define lithological contacts and the true boundaries of mineralisation. It also provides element concentration data for further analysis.

Kent Swick said: “We have seen good levels of interest across a wide spectrum of potential clients who have been trialling the product since it was introduced. Many of those are now deciding how to use the technology in their current work flows and we are confident a number of proposals will be converted into laboratory scanning agreements soon.”