Tag Archives: Worley

Worley acquires Minera Mining Technologies, expands automation and decarbonisation offering

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Worley says it has acquired Minera Mining Technologies, a global technical solutions provider to the mining, minerals and metals industry, furthering its ability to automate and decarbonise mining operations.

Adding Minera to its existing Technology and Expert Solutions team will strengthen the company’s role in the energy transition and bring greater depth to the roadmaps needed to achieve sustainable mining solutions, according to Worley.

“The acquisition of Minera aligns with Worley’s purpose of delivering a more sustainable world, and its aspiration to achieve 75% of its revenue from sustainability-related business within five years,” Nick Bell, Global Sector Lead, Resources, said.

Headquartered in Western Australia, Minera’s mining, geological and technical consultants work with mine owners to automate and decarbonise by determining the best-fit technology solutions and strategies for their assets. The pairing provides enhanced front-end solutions covering automation, fleet decarbonisation/electrification and operational benefits realisation, Worley noted.

Bell added: “The world needs more mining. But performance and production improvements are required as the energy transition and ESG pressure calls for sustainable materials delivered at pace. To meet these demands, the industry needs the right partner to identify and adopt new and emerging technologies, often within an operating environment. The acquisition of Minera means we can do just that for our customers all over the world.”

Martin Boulton, Director of Minera, added: “Automation will remain a puzzle unless miners develop horizons that plan the practical application across their assets. With the introduction of Minera, Worley can create autonomous business plans to help our customers define their target technology landscape, along with the delivery capabilities to achieve this operational state. We will also continue development of our autonomous skills training to grow industry capability and ensure solutions are implemented safely and on time.”

Miners need flexible solutions to meet decarbonisation goals, Worley’s Russell says

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The unique challenges the mining industry will face over its 30-year journey to decarbonisation are still being unpacked as it decides how to use enabling technologies and solutions, according to Nicholas Russell, Senior Mechanical & Mining Engineer at Worley.

“The journey to net-zero requires flexibility,” he said. “And we need to incorporate that flexibility from the very beginning.”

This, according to Russell, has seen an increased focus on collaborative solutions across the mining value chain, including the re-emergence of 70-year-old technology.

In-pit crushing and conveying (IPCC) works by crushing ore and waste material in an open-pit and using conveyors to transport the material to the process plant and waste dumps respectively.

While IPCC is not new, miners often associate it with rigid, inflexible mine plans that struggle to meet changing market demands, he said. “However, an IPCC system is no longer just a fixed asset. Flexibility and sustainability in operations is possible through design innovation, tailored equipment specification and automation.”

One of the new ways that IPCC can be implemented is by using a combination of relocatable and mobile conveyors in tandem with a mobile, truckless system. This sees a shovel dumps material into a moveable sizing rig that loads the automated conveyor fleet.

“Much like irrigation sprinkler machines, the system operates in parallel, or pivot, and a combination of different length hoses and pipes connect it back to a fixed point, which in this case is the process plant,” Russell said. “By increasing the reach of the system, multiple combinations of bench level, mine direction and pass widths can be considered and optimised.”

In one study, an overburden truck fleet that moved material from the mine face to the top of the in-pit dump was replaced with an IPCC system. The haulage energy was reduced by 63% and 3.5 Olympic swimming pools of diesel each year could be replaced with renewables for each shovel swapped over, according to Russell.

Providing flexibility for minimum viable projects

Alternatively, as the mine face moves, a relocatable IPCC system can move with it.

“Trucks powered by renewables complete small distances to a crusher which is moved periodically, with conveyors used for the rest of the journey to the plant,” Russell explained. “While both options give the flexibility to change mining locations, this option provides the energy efficiency and cost-effectiveness of conveyors while benefiting from the flexibility of a truck system.”

Flexibility is especially useful for miners establishing sites with “minimum viable capital”, according to Russell.

“Miners can start with a small truck fleet and minimum fixed plant, relocating the crusher and conveyor as and when required,” he explained. “This is a key advantage because it helps achieve project specific goals through different mine sequences to enhance an operation’s sustainability.”

Powering mines with renewable energy

Powered by electricity ‘from the grid’, IPCC can be an energy efficient option for miners. It gives miners the flexibility to choose renewables to power their site, including the energy used for the mass material movement from the mine face to the process plant and waste dump.

Worley and its consulting business, Advisian, has helped a number of mining companies assess and develop green energy supply partnerships, Russell explained.

This has included the analysis, assessment and guided procurement of Gold Fields’ Agnew Hybrid Renewable Energy Microgrid, which included 18 MW wind, 4 MW solar, 13 MW/4 MWh battery and 21 MW gas/diesel. As the largest hybrid renewable energy microgrid in Australia, it has the capacity to provide the mine with up to 85% renewable energy, with reliability in excess of 99.99%, Worley said.

Enhancing an IPCC system with bulk ore sorting technology

Nicholas Russell, Senior Mechanical & Mining Engineer at Worley

“As miners seek to get more from less, IPCC can be enhanced with ore sorting mineral sensing technology supplied by NextOre,” Russell said.

NextOre, a joint venture between the CSIRO, RFC Ambrian and Worley, is a bulk ore sorting technology that allows miners to sort and evaluate ore at high capacity, maximising recovery and delivering higher grade and lower tonnage mill feed, he explained.

“It can be easily retrofitted to IPCC conveyors, and measure everything on the belt,” he added. “The option also exists to increase grade while maintaining throughput on existing systems, maximising metal recovery through the entire system assuming upstream and downstream facilities can be de-bottlenecked.”

By improving sorting efficiency, and processing a better material grade, water and electricity consumption per tonne of ore mined is reduced, while the data from the sorting process can be used to learn more about what is coming out of the ground as it’s mined, with assumptions verified in real time.

IPCC in action

One of the world’s largest iron ore mines in Brazil, S11D (pictured, photo courtesy of Vale), is a notable example of how new IPCC technology is enhancing sustainability and protecting people and the environment.

For this project, Worley proposed a truckless mine – “the first of its kind”, Russell said.

The system uses mobile crushers and conveyor belts to replace traditional trucks, consequently reducing diesel consumption by approximately 70%, according to mine owner Vale. The system also allows the miner to process waste in existing industrial areas, moving it away from environmentally sensitive ones to further reduce the project’s environmental impact.

“In designing the project, the team’s biggest challenge was not only rethinking the mine plan and how the technology could be used on the site, but also re-evaluating the role people play in executing the concept,” Russell said. “It’s critical to re-educate technicians and engineers to equip them with the skills needed to work with these technologies safely.”

Russell believes technologies like IPCC will help miners meet their decarbonisation commitments, however no individual technology can solve the challenge.

“To focus solely on the benefits of the equipment and disregard the mine demands is a short-term solution to a long-term challenge,” he said. “If miners are to meet sustainability goals, they need flexibility, collaboration and a holistic approach to implementing new technology that starts at the mine plan.”

Nick Russell is due to speak at IM Event’s IPCC 2022 event in Mexico, on April 28-29, 2022, presenting a paper titled: ‘Fully mobile IPCC/truckless mining: lessons learnt’. Click here for more information on the event.

Syrah contracts Worley for anode material facility expansion

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Syrah Resources has awarded Worley Group with a contract to provide detailed engineering and procurement services for the initial expansion of production capacity at its “Active Anode Material” (AAM) facility in Vidalia, USA.

Worley, working with the Syrah project team, will undertake the detailed engineering and procurement for the planned 10,000 t/y AAM facility. These services have commenced and are being delivered by Worley’s US Gulf Coast team based in Louisiana.

“Worley is well positioned to maintain continuity through the next phase of Vidalia’s expansion due to its significant knowledge of Vidalia’s processing technologies and key equipment packages and integration with the Syrah project team,” Syrah said.

The two have worked through the previous project phases for the planned expansion of production capacity at Vidalia, including the bankable feasibility study, front-end engineering and design and interim detailed engineering. Worley also carried out engineering, procurement and construction services for the integrated and commercial scale facility at Vidalia.

Syrah plans to award contracts for construction management of the AAM facility prior to making a final investment decision for the expanded plant. This is planned during the second half of 2021.

Syrah operates the Balama graphite mine in Mozambique along with the downstream AAM facility in the US.

NextOre’s magnetic resonance tech up and running at First Quantum’s Kansanshi

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Australia-based NextOre is onto another ore sorting assignment with its magnetic resonance (MR) sensing technology, this time in Zambia at First Quantum Minerals’ Kansanshi copper mine.

NextOre was originally formed in 2017 as a joint venture between CSIRO, RFC Ambrian and Worley, with its MR technology representing a leap forward in mineral sensing that provides accurate, whole-of-sample grade measurements, it says.

Demonstrated at mining rates of 4,300 t/h, per conveyor belt, the technology comes with no material preparation requirement and provides grade estimates in seconds, NextOre claims. This helps deliver run of mine grade readings in seconds, providing “complete transparency” for tracking downstream processing and allowing operations to selectively reject waste material.

Having initially successfully tested its magnetic resonance analysers (MRAs) at Newcrest’s Cadia East mine in New South Wales, Australia, the company has gone onto test and trial the innovation across the Americas and Asia.

More recently, it set up camp in Africa at First Quantum Minerals’ Kansanshi copper mine where it is hoping to show off the benefits of the technology in a trial.

The MRA in question was installed in January on the sulphide circuit’s 2,800 t/h primary crushed conveyor at Kansanshi, with the installation carried out with remote assistance due to COVID-19 restrictions on site.

Anthony Mukutuma, General Manager at First Quantum’s Kansanshi Mine in the Northwestern Province of Zambia, said the operation was exploring the use of MRAs for online ore grade analysis and subsequent possible sorting to mitigate the impacts of mining a complex vein-type orebody with highly variating grades.

“The installation on the 2,800 t/h conveyor is a trial to test the efficacy of the technology and consider engineering options for physical sorting of ore prior to milling,” he told IM.

Chris Beal, NextOre CEO, echoed Mukutuma’s words on grade variation, saying daily average grades at Kansanshi were on par with what the company might see in a bulk underground mine, but when NextOre looked at each individual measurement – with each four seconds representing about 2.5 t – it was seeing some “higher grades worthy of further investigation”.

“The local geology gives it excellent characteristics for the application of very fast measurements for bulk ore sorting,” he told IM.

Mukutuma said the initial aim of the trial – to validate the accuracy and precision of the MRA scanner – was progressing to plan.

“The next phase of the project is to determine options for the MRA scanner to add value to the overall front end of processing,” he said.

Beal was keen to point out that the MRA scanner setup at Kansanshi was not that much different to the others NextOre had operating – with the analyser still measuring copper in the chalcopyrite mineral phase – but the remote installation process was very different.

“Despite being carried out remotely, this installation went smoother than even some where we had a significant on-site presence,” he said. “A great deal of that smoothness can be attributed to the high competency of the Kansanshi team. Of course, our own team, including the sensing and sorting team at CSIRO, put in a huge effort to quickly pivot from the standard installation process, and also deserve a great deal of credit.”

Beal said the Kansanshi team were supplied with all the conventional technical details one would expect – mechanical drawings, assembly drawings, comprehensive commissioning instructions and animations showing assembly.

To complement that, the NextOre team made use of both the in-built remote diagnostic systems standard in each MRA and several remote scientific instruments, plus a Trimble XR10 HoloLens “mixed-reality solution” that, according to Trimble, helps workers visualise 3D data on project sites.

“The NextOre and CSIRO teams were on-line on video calls with the Kansanshi teams each day supervising the installation, monitoring the outputs of the analyser and providing supervision in real time,” Beal said. He said the Kansanshi team had the unit installed comfortably within the planned 12-hour shutdown window.

By the second week of February the analyser had more than 90% availability, Beal said in early April.

He concluded on the Kansanshi installation: “There is no question that we will use the remote systems developed during this project in each project going ahead, but, when it is at all possible, we will always have NextOre representatives on site during the installation process. This installation went very smoothly but we cannot always count on that being the case. And there are other benefits to having someone on site that you just cannot get without being there.

“That said, in the future, we expect that a relatively higher proportion of support and supervision can be done through these remote systems. More than anything, this will allow us to more quickly respond to events on site and to keep the equipment working reliably.”

Worley to take Neo Lithium’s 3Q brine project into DFS stage

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Neo Lithium Corp and its Argentinean subsidiary LIEX SA have engaged Worley Chile and Worley Argentina to complete a definitive feasibility study (DFS) of its flagship 3Q lithium brine project in Catamarca, Argentina.

The development strategy for 3Q focuses on production of 20,000 t/y of lithium carbonate with the flexibility to expand production to 40,000 t/y after phase one is completed and operational. The DFS is scheduled for completion in the September quarter of 2021.

Gabriel Pindar, COO of Neo Lithium Corp, said: “On the back of CATL’s investment and involvement, we are very pleased to have engaged and be working with Worley who bring a wealth of lithium knowledge and experience to our 3Q project. Worley is a leading global engineering firm and has been involved in all aspects of lithium brine operations which will be invaluable in executing our DFS.”

Results of the last prefeasibility study (PFS) on 3Q performed by GHD Chile SA and Groundwater Insight Inc outlined a project with 20,000 t/y of lithium carbonate production potential with after-tax net present value (8% discount rate) of $1.143 billion, internal rate of return of 49.9%, and capital expenditure of $318.9 million.

Neo Lithium said the studies carried out by the company in its evaporation pilot plant at the salar site and the lithium carbonate pilot plant in the town of Fiambalá confirm that the general parameters defined in the PFS will be validated in the DFS.

Neo Lithium has been operating pilot evaporation ponds for more than three years, while the pilot lithium carbonate plant has been in operation for nearly two years. This has resulted in a meaningful ramp up in knowledge while improving the process all the way through to validate the PFS and take the project more efficiently into DFS with a view towards future construction, it said.

“As a result of our efforts to maintain steady operations at pilot scale level, we continue to produce our own lithium brine concentrate and lithium carbonate on a regular basis, and believe that we are on track towards our goal of being in production by the later stages of 2023,” the company added.

Rio flying high at technologically advanced Gudai-Darri iron ore project

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Western Australia’s newest airport has opened at Rio Tinto’s $2.6 billion Gudai-Darri (formerly known as Koodaideri) iron ore project in the Pilbara where construction is progressing ahead of expected production ramp-up in early 2022.

The facility can accept a range of different aircraft including Boeing 737s, A320s, F100s and King Airs. The current flight schedule includes four flights a week with additional flights expected to be added to the schedule next year. The airport is expected to handle more than 600 workers in a day at peak operating times, according to Rio.

The airport will deliver significant benefits in terms of minimising employee interaction with vehicles and driving, as well as helping to manage employee fatigue thanks to a significant reduction in travel time from an alternate regional airport, Rio says. The airport will also provide a safer landing option for Rio Tinto’s long-standing partner, the Royal Flying Doctor Service.

Rio Tinto Projects General Manager, Gudai-Darri, Anthony Radici, said: “You get a real sense of the immense size and scale of our Gudai-Darri operation once you fly into this new airport.

“The construction phase of the project is progressing well with a significant amount of infrastructure at the mine now built, millions of cubic metres of material moved, a new access road, a significant amount of the rail formation installed, two new bridges constructed and now a brand new airport.”

Rio Tinto Iron Ore Acting Chief Executive, Ivan Vella, said: “The construction phase of Gudai-Darri, our most technologically advanced mine, has a strong focus on supporting local businesses with contracts valued at more than $2.3 billion awarded to date.

“These contracts have supported approximately 2,000 jobs in the construction phase and the mining operation is expected to support about 600 jobs on an ongoing basis. We are proud to support West Australian businesses as we progress a pipeline of investment opportunities in the Pilbara valued at more than A$10 billion ($7.3 billion) over the three years to 2022.”

Contracts at Gudai-Darri valued at more than $2.3 billion have been awarded to local Pilbara, Pilbara Aboriginal and West Australian Businesses including Primero Group, NRW, DTMT, Pindan, White Springs, Hicks Civil & Mining and Karratha Earthmoving & Sand Supplies.

The full construction and design of the airport will be completed by local partners Primero Group, NRW, Worley and GHD, together with NRW subcontractors Colas, Fulton Hogan, TEC services, Brookdale Contractors, Bennco and Karlka Fencewright.

Gudai-Darri is a greenfield mine development, around 35 km northwest of the Yandicoogina mine in the East Pilbara mining region. The mine will initially be developed as a nominal 43 Mt/y high-grade, dry processing operation.

Worley’s Langridge urges miners to start small with next crop of projects

Mineral project development, Mining industry recognition, Mining services, ,

With favourable movements in most commodity prices against a backdrop of uncertainty from COVID-19, the minimum viable project model is appealing for small and large miners alike, according to Alan Langridge, Technology and Expert Solutions Regional Director, APAC at Worley.

“Large-scale complex ventures can take many years to develop, even longer to achieve payback and usually involve significant upfront capital expenditure,” he said.

“While these projects provide big capital returns, the patience needed to get to that point translates into higher risk, especially when orebodies are complex or difficult to assess from the surface. Some orebodies are big enough to warrant a project seeking to maximise net present value, but they often come with significant development challenges.”

This is why the industry needs an option between developing a mega project with all the associated risk and leaving the product in the ground, according to Langridge.

“There is growing recognition that a staged approach can facilitate earlier cash flow from operations, reduce risk and still achieve good financial returns based on a lower cost of entry,” he said. “A mine that is initially developed with the minimum viable features can be a big success, but it needs different thinking.”

By thinking small and minimising a starter project, companies can reduce initial costs, de-risk the project and still enable a pathway to build a bigger mine in the future, explains Langridge.

“Miners are no longer racing to get the highest overall return, or the absolute maximum net present value, or at least not right away,” he said. “They’re looking for an outcome that is acceptable from a corporate, social, financial and operational perspective, one that is sustainable and presents a lower development risk at the outset. This is particularly valid for orebodies that are large and deep because they often require high capital expenditure before the orebody is completely understood.”

Langridge says that when the amount of upfront capital costs on a project can be minimised, it is possible to get a mine up and running sooner and more economically. With less initial sunk capital, market fluctuations and uncertainties that exist in mining projects can also be better managed, he argues.

Establishing the minimum viable point for a project is an art form in itself, he says.

“We need to consider the limitations of each input; from energy supply to orebody knowledge, mining plans, off-take requirements, procurement and logistics through to construction, commissioning operations and closure,” he says.

“We also investigate alternative development approaches, such as shared infrastructure, different commercial strategies and partnering with other companies and operations. It’s worth considering every option to bring the investment down at the outset.”

Once the pieces of a minimum viable project fit together, the second driver is to determine the minimum size of the project while still being economically viable, he says.

“Finding the minimum viable capital cost is a two-fold approach,” explains Langridge. “We first establish the minimum from a technical perspective, and then the minimum from a financial perspective. As you go further down in scale, you naturally compromise economies of scale. Eventually you’ll reach a point where a project simply isn’t feasible. It’s a trade-off between how small things can be depending on project components.

“This becomes a model where small-scale operations pay for most of the costs that were initially delayed, although a margin is needed because there are upfront capital costs. There is a trade-off on how much is spent versus how much is owned, and how small the project can be while still being operable.”

Langridge says minimum viable projects afford the flexibility to get a mine up and running and to learn lessons from the first stage before committing to anything larger. However, when conditions warrant an increase in production, and the initial mine and plant have been designed well, then it is possible to scale it.

“Should market forecasts remain positive, then other parts of the project can expand in whatever manner makes sense,” Langridge says. “With the groundwork already in place, we can base this on actual market needs and financial and operational drivers, and not a set of assumed financial and operational drivers in the future.

“Getting proven technology into the base design allows our customers to identify where they want to carry heightened risk, or alternatively, to get the project entry point up and running and then evolve and innovate.”

It also delays some of the decisions around investment in technologies to a point where hopefully the price is 20% or 30% cheaper because of advancements in manufacturing, he says. “And, if what is implemented is a value enhancement, then it will create a return immediately because it’s on an operating site – it’s not just a theoretical evaluation,” he added.

Langridge says a smaller investment to get a minimum viable project started provides the flexibility to respond to the next movements in markets. “With this approach, we’re helping our customers realise solutions that facilitate cash flow sooner, minimise entry capital cost and allow a project to pay its own way,” he says. “It’s basically taking the mindset of a junior and select mid-tier mining company and applying this to a much larger project.

“Minimum viable projects are an easier investment decision at a time like this, and they’re proof that thinking small is a good way to get big projects right.”

Worley out to help miners on their open pit to underground mining transition

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As open-pit mines reach their economic end of life, mine owners are considering the viability of transitioning their open-pit operations to underground.

Drawing on its deep level mining expertise in South Africa, Worley helps mine owners around the world to explore the feasibility of underground life of mine extensions and identify the most efficient and safe underground mining methods.

Among the driving factors in the transition to underground mining are declining ore grades, deeper ore deposits, and an increase in demand for minerals required for the global energy transition, such as copper, lithium, manganese and nickel, Worley says.

“Worley’s centre of excellence for copper in Chile has been supporting open-pit copper mine customers for nearly three decades,” the company said. “The company is gearing up its underground capability as these mines shift their operations to below surface to access deeper ore reserves.”

Going deep in South Africa

Worley’s South Africa operations is one of the company’s mining centres of excellence with niche experience in deep level mining.

Mining has been the mainstay of South Africa’s economy for well over a century, and a major source of employment as well as foreign investment. Consequently, Worley has grown its South Africa mining team in one of the best mining environments in the world, with a collective experience of over 120 years in deep level mining and process expertise.

Robert Hull, Vice President for Mining, Minerals & Metals in Africa, says Worley’s South African operation is recognised for its deep level shaft experience, and the company also has experience across most commodities including base metals, coal, platinum, gold, diamonds and ferrous metals.

Hull says Worley has a strong global workshare philosophy and culture of collaboration. The specialist skills in South Africa gained from working on some of the biggest underground projects in the world are an integral part of Worley’s mining, minerals and metals global project delivery offering.

Deep level mine skills

Some of South Africa’s specialist deep underground skills include shaft design, ventilation and refrigeration shafts, high pressure pumping, and deep level hoisting.

Worley says it is one of the few companies in the world that has the expertise to design hoisting systems for mass hoisting, such as at the Venetia Underground Project, which will hoist approximately 6 Mt/y of rock.

The De Beers Venetia Mine in South Africa is the biggest source of rough diamonds in the country, according to Worley. The mine is in the process of transitioning from open pit to underground, to extend its life by some 25 years.

As engineering procurement and construction management contractor for South Africa’s largest mining execution project, Worley is using 3D designs for the project infrastructure to provide 3D models for the entire project’s surface and underground infrastructure, it said.

Intelligent mines

Hull says Worley is leading the way in developing digital solutions for the planning, design and execution of mining projects, with the South Africa office having played a key role in the design and development of much of the group’s digital technology in mining and minerals processing.

Hull (pictured) cites the Wafi-Golpu (owned by Harmony Gold Mining and Newcrest Mining) feasibility study update, in Papua New Guinea, where the South Africa team drew on SmartPlant design technology, which uses rapid prototyping and Building Information Modelling. The technology allowed the entire project team to visualise project objectives as never before, greatly improving operational efficiency in a dynamic time and cost-saving environment, according to Worley.

The Wafi-Golpu project is ranked as a world-class deposit in terms of its size and the grade of gold and copper within it. If developed, it will be the largest, deepest and most complex underground mine in Papua New Guinea, with a mine life of 28 years, Worley says.

Integrated project delivery teams

Worley’s South Africa team is also supporting its Australia counterparts to project manage the delivery of the deepening and expansion of an underground gold mine. This includes construction of a 1,460 m shaft, additional capacity in the processing plant, and supporting infrastructure to enable profitable recovery of ore at depth to 2 140m below surface. IM understands the project in question is the Newmont-owned Tanami Expansion 2 project, in the Northern Territory of Australia.

Mega machines for mega mines

Hull says every underground project Worley has executed has drawn on the company’s large material handling capabilities.

“In South Africa, we have a dedicated materials handling department that has the latest tools including discrete element modelling and finite element analysis, and advanced simulation tools for conveyer design,” he said.

Coenie Mynhardt, Winder Engineering at Worley, adds that mine payloads have increased dramatically in the last two decades in pursuit of higher productivity rates. Mines such as Impala and Phalaborwa, in South Africa, with an approximate 12-t per skipload, were considered ‘mega mines’ in their day. The mines of the future are more than double that size.

“The mega mines of the future need mega machines to be able to handle such big payloads,” Mynhardt says. “Materials handling technology for such deep, high tonnage operations will test current technology for capacity and reliability to bring the ore from the production levels to surface. We have the skills and expertise to find the solutions to these challenges.”

Global project delivery

“Countries such as Chile have immense potential for transitioning from open pit to underground if the geology supports it,” commented Hull. “With the wealth of experience across locations and over 4,000 staff in our mining, minerals and metals business line, we can safely and successfully deliver our customers’ underground mine assets through collaborative development of the mine and associated infrastructure anywhere in the world.”

Worley to help sustain Alcoa of Australia’s mines, refineries and smelter

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Worley says it has been awarded a three‐year services contract with Alcoa of Australia for the company’s integrated mining, refining and smelting operations.

Under the contract, Worley will provide engineering and project delivery services for Alcoa’s site‐based sustaining capital program of works.

The contract continues the existing relationship between Alcoa and Worley, and establishes Worley as the preferred engineering services provider for baseload works across the Wagerup, Pinjarra and Kwinana alumina refineries, Bunbury port terminal and the Willowdale and Huntly (pictured) bauxite mining operations in Western Australia, it said. Worley will also support Alcoa’s Portland aluminium smelter in Victoria, Australia.

The services will be executed by Worley’s Australian teams in Perth and Geelong and supported by its global integrated delivery team, the company added.

Chris Ashton, Chief Executive Officer of Worley, said: “As Australia’s leading energy services company, we are pleased to continue supporting Alcoa’s Australian operations. This portfolio is one of the largest in our mining, minerals and metals business and includes our specialist alumina, bauxite and aluminium teams.”

Worley cuts 5% of staff on COVID-19-related uncertainty

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Engineering firm Worley has decided to cut 5% of its staff as it continues to deal with the fallout from the COVID-19 pandemic.

The company said it had seen a contraction in the business from customers’ delays, deferrals and cancellations, particularly in field-based work and, more specifically, in lower margin construction-related activities.

This has seen headcount drop to 56,000 as at March 31, 2020, down 5% from 59,000 as at January 31, 2020.

Worley explained: “The current economic circumstances have led to a rapidly changing environment for Worley’s business. To date, the impact of these changes has been limited.”

As a result of the acquisitions of AFW UK in 2017 and Jacobs ECR in 2019, Worley says it is a “more diversified business” in the energy, chemicals and resources sectors, with reduced exposure to both oil and gas and general capital expenditure.

Despite the economic outlook and customers’ responses being difficult to predict, the company said it was preparing for a range of scenarios.

“Worley is delivering projects and providing services to support our customers with most of our office-based people working from home,” it said. “Worley also continues to provide field-based services to build, improve, maintain and operate critical infrastructure in Australia and around the world.”

In response to the current economic circumstances, and recognising it is still early, Worley says it has and will continue to implement measures to adjust both operational and support cost structures; postpone all non-essential capital expenditure; protect cash, manage receivables and minimise discretionary spend; optimise staffing levels and costs while retaining capability; and maintain productivity on projects and operational support services.

“Worley is closely monitoring developments and opportunities in each of the regions in which we operate and will consider additional initiatives as appropriate, recognising the current economic circumstances present opportunities to work smarter and more cost effectively in the future business environment,” it said.

On top of having a strong financial position, Worley said it was better prepared to face any potential fallout from COVID-19 following the strategic acquisitions of AFW UK in 2017 and Jacobs ECR in 2019.

Around 20% of Worley’s revenue is derived from exposure to customers’ upstream and midstream oil and gas capital expenditures, down from 65% prior to the acquisitions. Meanwhile, 45% of Worley’s revenue is derived from customers’ operating expenditures, up from 10-15%, it said. “Operating expenditure contracts tend to be longer term, multi-year contracts,” the company noted. Lastly, 37% of Worley’s revenue is derived from the chemicals sector, up from less than 10%. The chemicals sector has shown in previous cycles to be less cyclical than others, Worley said.

Chris Ashton, Chief Executive Officer of Worley, said, “We are responding with agility to the rapidly changing environment. We are ensuring the safety and wellbeing of our people, we have increased our liquidity position and we continue to review and adjust the business operationally.

“I am proud of our people as they demonstrate resilience and harness their ingenuity and expertise supporting customers, colleagues and communities.”