Tag Archives: Tom McCulley

Anglo American produces first copper concentrate from Quellaveco

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Anglo American plc has announced first production of copper concentrate from its Quellaveco project in Peru – a major milestone as Quellaveco nears completion ahead of receiving final regulatory clearance for commercial operations to begin.

Tom McCulley, who has led Anglo American’s development of Quellaveco, said: “First copper production at Quellaveco is a key milestone in our delivery of this world-class asset, on time and on budget. The fact that we are today producing copper less than four years after project approval, including through two years of considerable pandemic-related disruption, is testament to the strength of our commitment to our workforce, local communities, the Moquegua region and government stakeholders in Peru. This first production of copper concentrate marks the beginning of the normal period of testing the processing plant with ore and the ramping up of mining activities to demonstrate readiness for operations.”

Adolfo Heeren, CEO of Anglo American in Peru, added: “Quellaveco is a project for all of Peru and especially for the Moquegua region. Once in full operation, Quellaveco alone will increase Peru’s copper production by around 10%, and deliver sustainable benefits for decades to come, including 2,500 direct jobs, the incorporation of local suppliers into our supply chain, the increase of water sources for human consumption and irrigation, digital connectivity, the expansion of agricultural areas and tax revenues. By working together in partnership, we will deliver enduring positive outcomes for all our stakeholders.”

Quellaveco is an open-pit copper mine located in the Moquegua region in the south of Peru. Construction started in 2018, with estimated total capex of $5.5 billion, which includes the $600 million additional cost of managing the impacts of the COVID-19 pandemic since 2020. In 2021, Anglo American also approved the construction of a Coarse Particle Recovery plant to allow retreatment of coarse particles from flotation tailings to further enhance copper recovery rates. Other technology innovations include the use of autonomous haulage operations – with a fleet of Caterpillar 794 ACs – and autonomous drilling operations – with Epiroc Pit Viper 351s. These are being overseen by an Integrated Operations Centre which recently started up.

Quellaveco is expected to produce 300,000 t/y of copper-equivalent on average over the first 10 years of operation, at a highly competitive C1 unit cost of circa $0.95/lb over the first five years once the operation reaches full production capacity.

Quellaveco has an estimated 1,700 Mt of reserves, 8.9 Mt of contained copper at 0.53% TCu, and a 36-year reserve life, with potential for further expansion given its estimated additional resources at 1,600 Mt, containing 6.1 Mt copper (at 0.38% TCu).

Anglo American expects that Quellaveco will reach design production capacity in 12 months. Production guidance for 2022 is 100,000–150,000 t of copper at a C1 unit cost of circa $1.35/lb. Production guidance for 2023 and 2024 is 320,000–370,000 t.

Quellaveco is owned 60:40 between Anglo American and Mitsubishi Corporation.

Anglo American kicks off commissioning at Quellaveco copper project

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Anglo American has unloaded the first ore to the primary crusher at the Quellaveco copper project in Peru, marking a crucial milestone in commissioning tests prior to the start of operations.

Autonomous truck No. 19 – a Caterpillar 794 AC whose hopper sports the colours of diversity – was chosen to unload the ore at the $5.5 billion operation.

The ore entered Line 1 of the primary crusher where it was reduced to a size of 6.5 in (165.1 mm). Subsequently, it was taken from the mine area through a system of conveyor belts that extend more than 6 km to the coarse ore stockpile in the Papujune concentrator plant. Here, some 30,000 t of crushed ore was deposited. From there, it moved to the grinding area, where commissioning tests for the Line 1 SAG and ball mill began.

Tom McCulley, former CEO of Anglo American in Peru, was present at this important milestone for the upcoming start of operations. “Today, Quellaveco reached its most significant milestone with the shipment of the first ore to the processing plant. I want to thank all the 30,000 Peruvians who were with us during the construction stage.”

The commissioning tests are designed to ensure the optimal operation of the equipment and to verify the proper transfer of the ore from the time it is extracted in the pit to the processing plant, where the copper concentrate will soon be produced.

Quellaveco is in the Moquegua region and, at full capacity, will process 127,500 t/d of material. It will, Anglo American says, be the first 100% digital mine in the country, introducing new technology and processes to the national mining industry, such as autonomous mine haulage, that will improve performance in safety, production and sustainability.

Anglo American signals design changes at Woodsmith polyhalite project

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Anglo American has outlined plans to change elements of the design at its Woodsmith polyhalite project in the UK, which will have a bearing on both the sinking of the two main shafts and development of the underground mining area at the project.

The company has been running a detailed technical review on Woodsmith since mid-2020 to ensure the technical and commercial integrity of the full scope of its design. This followed the acquisition of the asset as part of a takeover of Sirius Minerals earlier that year.

“Now largely complete, the review has confirmed the findings of Anglo American’s due diligence that a number of elements of the project’s design would benefit from modification to bring it up to Anglo American’s safety and operating integrity standards and to optimise the value of the asset for the long term,” the company said.

Anglo is also making a change to the leadership at Woodsmith following its integration into Anglo American and ahead of the full project execution phase. Tom McCulley, who has led the development of the Quellaveco copper project in Peru, will take over from Chris Fraser as CEO of Crop Nutrients. This will see Fraser step aside and take on a strategic projects role for Anglo.

“The Woodsmith team is further developing the engineering to optimise the configuration of the project, recognising the multi-decade life of the mine,” Anglo said.

Particular attention is on the aspects identified at the outset of Anglo American’s ownership – namely, the sinking of the two main shafts, the development of the underground mining area, and the changes required to accommodate both increased production capacity and the more efficient and scalable mining method of using only continuous miners, it said.

The sinking of the two main shafts is due to be carried out using Herrenknecht’s Shaft Boring Roadheader (SBR) technology. DMC Mining, a company familiar with the technology thanks to its work sinking shafts at Jansen in Saskatchewan, Canada, was previously tasked with sinking the production and service shaft, each around 1,500 m deep, and two smaller shafts associated with the materials transport system, each approximately 350 m deep. Its contract was ended in 2020.

These improvements will, the company said, require the installation of additional ventilation earlier in the development of the underground mining area.

“Anglo American expects that these changes to the design of the mine infrastructure – which will result in a different, enhanced configuration and therefore a different construction and production ramp-up schedule – will ensure that its exacting standards are met and the full commercial value of the asset is realised,” the company said.

Mark Cutifani, Chief Executive of Anglo American, said: “We are very happy with the high quality and exciting potential of Woodsmith, with the scale and quality of the polyhalite orebody pointing to a quartile one operating cost position and strong margins. This is a very long-life asset and we are going to take the necessary time to get every aspect of the design right to match our long-term vision and value aspirations.

“We have said from the outset that we expect to make improvements and that we will execute certain elements of the construction differently and with a more conservative schedule. We expect to have completed our design engineering, capital budget and schedule at the end of 2022, with a fully optimised value case that recognises the upside potential we see in Woodsmith, and we will then submit the full project to the board.”

In the meantime, construction of the major critical path elements of the project, principally the two main shafts and the mineral transport tunnel, is progressing, with approximately $700 million of capital expected to be invested in 2022, Anglo said.

The plan at Woodsmith under previous owners Sirius was to extract polyhalite via two mine shafts and transport this outside of the National Park to Teesside on a conveyer belt system in an underground tunnel. It would then be granulated at a materials handling facility, with the majority being exported to overseas markets. The company was previously aiming to achieve first product from the mine by the end of 2021, ramping up to an initial production capacity of 10 Mt/y and then full production of 20 Mt/y.

The changes to McCulley’s and Fraser’s roles are effective January 1, 2022. Anglo American has appointed Adolfo Heeren as CEO of Anglo American in Peru, effective from the same date. Heeren will work together with McCulley during the first half of 2022 to ensure a smooth transition from the construction and commissioning phase of Quellaveco into operations, expecting first copper production in mid-2022.

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

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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.