Canadian Mining Journal April 2020

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MANAGEMENT EVOLVING EXPECTATIONS SPUR NEW IDEAS

DEWATERING TECH FOR TAILINGS CONSIDERING CLIMATE CHANGE

APRIL 2020 | www.canadianminingjournal.com | PM # 40069240

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CANADIANMINING

APRIL 2020 VOL. 141, NO. 3

JOURNAL

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CANADIAN MINING JOURNAL

FEATURES 12 16

PDAC 2020: Investor interest in ESG intensifies.

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An analysis by CostMine details how costs ballooned at Galore Creek between 2004 and 2011.

WATER MANAGEMENT 21 25

How the design of tailings facilities is changing to factor in climate change.

Veolia investigates biological treatment for saline water effluent.

DEWATERING TECHNOLOGY

29 FLSmidth reports on advances towards dewatering large volumes of tailings.

32 Creating value from waste through tailings reprocessing.

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DEPARTMENTS 4 EDITORIAL | COVID-19 plunges miners into uncharted territory.

5 LAW | Ruth Promislow and Matthew Flynn of Bennett Jones on the growing cybersecurity risks facing miners.

6 CSR & MINING | Jane Church and Carolyn Burns of NetPositive discuss the evolution of social performance management systems in mining.

8 UNEARTHING TRENDS | EY’s Iain Thompson outlines trends in exploration, including a search for a wider array of minerals, in British Columbia.

9 FIRST NATIONS | Chad Norman Day, president of the Tahltan Central Government in B.C., discusses the importance of reconciliation in the internal conflict of the Wet’suwet’un Nation.

10 FAST NEWS | Updates from across the mining ecosystem.

www.canadianminingjournal.com APRIL 2020

ABOUT THE COVER

Cover image: BlackJack3D, istockimages.com

Coming in May Canadian Mining Journal looks at mining in the digital age, with feature reports on ventilation and mine and mill safety.

For More Information

Please visit www.canadianminingjournal.com for regular updates on what’s happening with Canadian mining companies and their personnel both here and abroad. A digital version of the magazine is also available at www.digital.canadianminingjournal.com

CANADIAN MINING JOURNAL |

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FROM THE EDITOR APRIL 2020 Vol. 141 – No. 3

CANADIANMINING COVID-19 plunges miners into uncharted territory Alisha Hiyate

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n Sunday, Mar. 1, the first day of this year’s Prospectors and Developers Association of Canada (PDAC) convention in Toronto, a smaller than usual audience sat listening to Paul Robinson, a director at CRU Group, describe how every day life had changed for CRU employees in Beijing because of COVID-19.

At that point, the group’s 35 employees in the city – none of whom had been to Wuhan, the epicentre of the novel coronavirus outbreak in China – had not left their homes for three and a half weeks, working from home, ordering food in, and “selfisolating.”

Little did the audience realize that within weeks, many of us would be facing the same extreme measures to fight the spread of the novel coronavirus.

Although the virus was starting to spread globally at that point, there were only a handful of confirmed cases in Canada – mostly linked to travel either to China or Iran.

Very quickly, however, it became apparent that Canada, the United States and Europe would not be spared.

Now, three weeks later, there have been restrictions on international and domestic travel, the closure of borders, the shutdown of all non-essential businesses, and orders to practice “social distancing.”

As a result of the incredible disruption to the global economy, commodities prices have plunged. Oil is at US$22.50 a barrel; copper is under US$2.10 per lb.; and, after hitting US$1,687 per oz. in early March, then crashing to below US$1,500 per oz., safe-haven gold was back up to US$1,561 at presstime.

Mine after mine has announced a scale down of production or a transition from active mining to care and maintenance, sometimes related to travel restrictions, sometimes related to the protection of remote Indigenous communities.

The only thing spreading faster than the virus, seemingly, is fear. On Mar. 18, unionized mine employees at BHP Billiton’s Escondida copper mine in Chile expressed concern about health and safety measures at the mine surrounding the virus, and said they would ask authorities to shut down the mine if stricter measures were not implemented. A day later, Rankin Inlet residents blockaded a road to Agnico Eagle Mines’ Meliadine mine in Nunavut, fearing that fly-in workers could introduce the virus locally.

The movement of staff to and from remote sites poses a unique challenge for mining operations.

Some mines have announced short-term measures (two to four weeks) of operating on care and maintenance with a skeleton staff, but they are grappling with how or if they can keep their operations staffed and healthy during this pandemic.

While there is no way to know how long this virtual shutdown of the global economy will last, it is certain that when we come out on the other side of this, there will be a violent snapback of demand for just about everything.

Miners who can hold on during these strange times will be essential in helping us all CMJ rebuild a new “normal.”

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MINING JOURNAL

225 Duncan Mill Rd. Suite 320, Toronto, Ontario M3B 3K9 JOURNAL Tel. (416) 510-6789 Fax (416) 510-5138 www.canadianminingjournal.com Editor-in-Chief Alisha Hiyate 416-510-6742 ahiyate@canadianminingjournal.com Twitter: @Cdn_Mining_Jrnl

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News Editor Magda Gardner CANADIAN MINING JOURNAL mgardner@canadianminingjournal.com Production Manager Jessica Jubb jjubb@glacierbizinfo.com Art Director Barbara Burrows Advisory Board David Brown (Golder Associates) Michael Fox (Indigenous Community Engagement) Scott Hayne (Redpath Canada) Anthony Moreau (Iamgold) Gary Poxleitner (SRK) Manager of Product Distribution Jackie Dupuis 403-209-3507 jdupuis@glacierrig.com Publisher & Sales Robert Seagraves 416-510-6891 rseagraves@canadianminingjournal.com Sales, Western Canada George Agelopoulos 416-510-5104 gagelopoulos@northernminer.com Toll Free Canada & U.S.A.: 1-888-502-3456 ext 2 or 43734 Circulation Toll Free Canada & U.S.A.: 1-800-387-2446 ext 3505 Group Publisher Anthony Vaccaro Established 1882

Canadian Mining Journal provides articles and information of practical use to those who work in the technical, administrative

and supervisory aspects of exploration, mining and processing in the Canadian mineral exploration and mining industry.

Canadian Mining Journal (ISSN 0008-4492) is published 10 times a year by Glacier Resource Innovation Group (GRIG).

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We acknowledge the financial support of the Government of Canada.

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LAW

The alarm bell is sounding for cybersecurity in mining

By Ruth Promislow and Matthew Flynn

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ybersecurity is one of the biggest risks for all businesses.

However, the alarm bell has been slow to sound in the mining industry. Cybersecurity risks arise as mining equipment and software increasingly become connected to public and private data networks. Cyber-attacks keep getting more costly – the average annual cost of cybercrime to a Canadian company was over $12 million in 2018, according to Accenture.

Industrial control systems (ICS) are another key vulnerability for mining companies. ICS are now networked and it has become commonplace that production can be controlled from a device. If an intruder takes control of that device, then they also have control of your production. The Canadian Centre for Cyber Security issued 44 ICS advisories in 2019 on cyber threats, vulnerabilities or incidents affecting Canada’s critical infrastructure. 2020 is already on pace to exceed this number.

Here are 10 key things for miners to keep front of mind as they respond to the growing business risks of cybersecurity:

ery at a mining site. Improper testing of the components prior to deployment might then allow the virus to proliferate undetected, resulting in a system crash, disrupting operations.

for cyber-attacks against mining companies can 1downMotives vary. The motive may be financial, where the attacker shuts the mining system until a ransomware payment is made.

to circumvent the organization’s security protocols and steal sensitive data. Insufficient employee training about how to recognize potentially malicious emails could enable an intruder to download malware onto your system.

The motive may be political, where the attacker seeks to interfere with operations. Or the attacker could be driven by competition, aiming to steal IP and proprietary data.

news is NOT good news. Many organizations assume 2goodNo that if they have not been made aware of an incident, that is news. However, an intruder could easily be situated within your network waiting for the appropriate time to strike.

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Risks from cyber-attacks include personal safety, temporary shutdown of business operations, ransomware demands, destruction and theft of data, regulatory investigation and proceedings, regulatory fines, drop in share price, damage to reputation, breach of contract litigation, shareholder litigation and third-party litigation involving personal safety issues.

Managing third-party risks involves more than technologi6consider cal measures. Ensure third-party contracts appropriately and address the risk. For example: in what circum-

stances must the third party alert you to a security incident within their organization? How quickly must they alert you to this security issue? Who bears the cost should a security incident within the third party affect your organization? Do they have insurance to cover the range of realistic risks? Does the insurance address the damages that your organization may suffer as a result of the third-party incident?

Your cybersecurity is only as strong as your weakest link.

7phishing Insufficient employee training on how to recognize spear and social engineering attempts enables a competitor

addition to outside intruders, hostile insiders may be a 8 Inthreat.

What systems are in place to manage these threats? and officers may have personal exposure as a result 9ariseDirectors of cyber-attacks against their organization. Exposure could in circumstances where it is alleged that they failed to exer-

cise due diligence in ensuring there was proper governance, policies and procedures in place.

Invest the resources and time to understand the risks that 10 are particular to your organization. Undertake a risk and vulnerability assessment that examines your operations and

practices by your third-party contractor can put 4ticesSecurity your organization at risk. For example, poor security pracby a third-party contractor could allow a virus to migrate

identifies the gaps in protection. Doing so not only manages the risk of attack, but can also help to minimize exposure in litigation arising from an attack.

Canadian mining companies need to be proactive as they respond to the alarm of cybersecurity risks, rather than simply reacting to incidents. It makes good business sense and can reduce the costs of responding to an inevitable attack.

CMJ

within the supply chain could allow ICS equip5 Weaknesses ment to be intercepted and malware installed prior to deliv-

RUTH PROMISLOW and MATTHEW FLYNN are both partners at Bennett Jones LLP, based in Toronto.

into the production environment, shutting down critical systems and creating unsafe working conditions.

APRIL 2020

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CSR & MINING

TAKING STOCK: Are social performance management systems delivering better outcomes?

By Carolyn Burns and Jane Church

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or many decades, social performance and community relations in the mining sector were managed off the side of someone’s desk. Companies typically did not have dedicated resources for dealing with “social issues.” At the same time, there were limited requirements of companies and any community relations work that took place was often inspired by management or employees having an interest in philanthropy and community development. Community relations was seen as a soft skill and there were few best practices, trainings or guidance available.

In the early 2000’s leading companies began to professionalize and systematize their efforts. Fast forward almost 20 years and social performance is now seen as business critical. It is a professional discipline similar to health and safety and environmental management. The professionalization of social performance has been influenced by increased regulatory and financing requirements as well as greater societal expectations about corporate behaviour.

The industry has recognized the inherent business risk that social issues can present. ‘Licence to Operate’ is the top business risk facing mining and metals for the second year in a row, as reported by EY. EY notes that the landscape is shifting “beyond the narrow focus on social and environmental issues” and that “applying just the social and environmental lenses, seeing it as a soft issue or allocating it to one section of the business will directly threaten your ability to operate,” (Top 10 Business Risks and Opportunities – 2020, EY).

Management systems are a key part of the professionalization of social performance and the push to increase the rigour of company approaches. By the early 2010’s every major mining company had developed a social performance management system. Social performance learned from other disciplines and built management systems around the same core processes and fundamentals used by other functions such as following a plan-docheck-act/adapt cycle.

Elements of a good social performance management system w Fit for Purpose. An effective management system meets corporate and community requirements without being too prescriptive. Importantly, it is adaptable and scalable to the local context, which when dealing with social issues, will always be different.

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w Integrated. Social performance management systems must align and integrate with other company management systems and the core business – social performance is everyone’s business in the same way that safety performance is everyone’s business. w Comprehensive. Social performance management systems should cover impact mitigation, stakeholder engagement, and benefit sharing and be aligned with enterprise risk management systems. w Include assurance. Social performance gets a bad rap for not being ‘measurable’ yet when there is a system in place, there is now something to measure against and defining KPIs should be part of the process. Third-party assurance is increasingly common, often driven by investors, financiers, governments, or other external organizations. w Inclusive of internal and external stakeholders. Information and major strategic decisions should be inclusive of external stakeholders, especially local communities. w Adaptive to external requirements. Top companies are feeling pressure from standards and expectations frameworks, and companies should ensure their management system helps them respond to those expectations.

Does having a social performance management system guarantee better outcomes?

The emphasis on management systems is based on the idea that if a company has the right process in place, the right outcomes will follow. In part this is in response to the challenge the industry has faced in terms of measuring and demonstrating good social performance outcomes. It also is in response to the pressure from external requirements and from shareholders, lenders, and financing bodies who want to feel confident in a company’s approach to managing licence-to-operate risks.

While the good practices noted above can certainly help a company improve its management system and approach, ultimately there is no guarantee that social challenges will be avoided – particularly when social risks can be so cross-cutting (e.g. the risk of a tailings dam collapse will have massive social implications). However, management systems will help the www.canadianminingjournal.com

company become more consistent, avoid making predictable mistakes, and make social performance everyone’s responsibility.

This supports an internal paradigm shift that tends to deliver better social outcomes.

What’s next?

We see two big trends when it comes to social performance management systems. First, they will continue to be the core foundation of a company’s social performance approach as expectations and external assurance requirements grow.

Companies have responded by increasing the rigour of their approach, which in some ways has created more space for external organizations to expect even more.

As a result, we see a proliferation of standards and frameworks to measure and demonstrate companies’ social performance: from indices like the Dow Jones Sustainability Index to multi-stakeholder efforts like the Initiative for Responsible Mining Assurance. This is on top of industry-led initiatives like the Mining Association of Canada’s Towards Sustainable Mining, ICMM’s Performance Expectations, and the Responsible Gold Mining Principles from the World Gold Council. It’s unclear if the proliferation of standards and frameworks improve outcomes, but it doesn’t seem to be changing anytime soon.

Secondly, just as the mining industry has professionalized its approach to social performance, community, local government, and civil society stakeholders are also improving their approach to tackling the social issues that come along with mining development. The benefits of a management system are not unique to the mining industry and stakeholders dealing with social issues around mining are recognizing they need an equally systematic approach.

Communities are developing internal community protocols for responding to mining projects and NGOs are developing standards and guidance for their operations in mining-affected areas to tackle mining-related risks and opportunities relating to their activities. Communities and NGOs can learn from industry’s experience to improve the processes they employ.

In this ever-changing landscape of growing social risks and expectations, well-integrated and effective management systems can help drive a paradigm shift among all involved stakeholders across the industry, from companies to local partners, that responds to these social changes and prioritizes positive social outcomes.

CMJ CAROLYN BURNS is director of operations at NetPositive, a non-profit that works with diverse stakeholders to help local communities see sustained positive outcomes from mining.

JANE CHURCH is a co-founder and director of collaboration with NetPositive.

Projects that hold water Water – you can’t operate without it. As your partner, we enable you to secure, manage and utilize every single drop. That’s an approach that holds water.

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APRIL 2020

CANADIAN MINING JOURNAL |

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UNEARTHING TRENDS

BC exploration expenditures reaching more diversified portfolios

By Iain Thompson

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he prospects for new discoveries leading to new mines in British Columbia were bleak just a few short years ago. Investment in early-stage exploration was nowhere near where it should have been to replenish reserves for the future. That began to turnaround in 2017 with improved macroeconomic conditions and financial markets further opening to the junior sector. In 2019, more projects started to progress through the latter stages of the exploration cycle bringing forward the possibility of new developments in the near future.

The 2019 British Columbia Mineral and Coal Exploration Survey shows that while positive momentum gained from spending in 2016-2018 flattened last year (down 1%), there was a 10% jump in the number of projects.

Companies are making shifts across the province and into more diversified portfolios, driving a number of new and continuing trends.

BC poised for a future of diversified metals Growing demand for electric vehicles and green energy led to a global uptick in demand for base metals. The 2019 survey identified exploration targeting approximately 32 metals, industrial minerals and coal. And base metals now comprise of 39% of total exploration activity in B.C. Gold still attracts the largest exploration spending for the region, but data shows investors are moving more investments towards copper, silver and nickel deposits.

Meanwhile, coal exploration continues to face downward pressure. Aside from a brief uptick, investment decreased last year – extending a trend that began in 2012.

Northwest region catching eyes Copper and nickel exploration in the Northwest region – which saw the highest growth last year, owning 55% of the province’s total exploration expenditure – is, in part, responsible for the increase in diverse investment. This region continues to attract exploration activity as investors capitalize on high-grade discoveries supported by investment from major firms, partnerships with Indigenous groups and ongoing infrastructure development. This, coupled with possibility for M&A activity and new infrastructure, continues to drive development in the region.

Recent examples include: 8 | CANADIAN

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w Steady increases in investment from majors driving M&A activity, such as purchases from Newmont and Newcrest Mining, and a focus on junior mining opportunities like GT Gold, Garibaldi Resources and Ascot Resources. w Continued investment in new infrastructure, including the paving of the Stewart-Cassiar Highway, the opening of ocean port facilities for export of concentrate and the completion of a high-voltage transmission line. w Government funding and commitment to the continuation and expansion of the BC Regional Mining Alliance.

Although growth has been stagnant at a local level, Canada’s national exploration expenditure slid into fourth in global rankings – falling behind South America, Australia and Europe/ Mainland China – for the first time since 2001. As B.C. looks to attract greater national and global investment, there needs to be better collaboration between industry, government and communities to capitalize on similar opportunities demonstrated in the Northwest region to drive investor attention.

A healthy exploration industry is foundational to future investment, job creation and community development – plus fundamental to maintain a flow of new projects and source new mine development opportunities. A shift in investment towards copper and other base metals provides reason for optimism in B.C., but these last few months have proven that many factors can quickly influence exploration activity in the year ahead.

CMJ IAIN THOMPSON is the EY Canada Mining and Metals Advisory Leader. He is based in Vancouver. For more information, visit www.ey.com/ca/mining.

www.canadianminingjournal.com

FIRST NATIONS

Reconciliation comes in many forms

By Chad Norman Day

PHOTO: PATPITCHAY, ISTOCKIMAGES.COM

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pray that all First Nations could organize themselves effectively and validate, amend or replace their pre-contact laws/ practices/institutions and communicate such decisions openly and honestly, with both their own citizens and others, so that everyone can move forward with certainty.

If the Wet’suwet’en Nation as a collective opposes the Coastal GasLink pipeline project, I support them.

If the Wet’suwet’en Nation as a collective supports this project, I support them.

If the Wet’suwet’en Nation has multiple governments arguing over who has authority and does not have decision-making processes in place for their citizens to make nation-based decisions, it’s difficult to support anyone.

People need to remember that “Indigenous Law” or “Indigenous Culture” is like any other culture, society or laws – they continually change as the people, environment and modern-day realities change around them. Adapting to the environment is as human as it gets for all cultures and communities around the world.

Arranged marriage was a common Indigenous practice for many of us in the past, and it changed. Arranged murders or banishments were too, and those changed. Many other practices and laws changed, while others remained through the collective behaviour and decisions of the people.

Oftentimes we see individuals “cherry-pick” a portion of traditional culture to support their argument or view, without acknowledging that the cultural practice in question was utilized in conjunction with many other cultural practices that no longer exist or were replaced. When some laws or practices change permanently, it can impact everything in the society/ community, just as removing some species from an ecosystem can change everything.

It all comes back to internal governance, which takes a lot of effort, commitment, discipline and resources. Many First Nations struggle as they are in a constant balancing act of trying to succeed in modern-day society while attempting to revitalize or maintain culture, often with limited resources. It’s very challenging and complicated.

I have said it many times and will say it again here: Reconciliation comes in many forms. We need to find reconciliation amongst ourselves and become healthy individuals first, followed by pursuing reconciliation internally within our own communities, before we can achieve reconciliation with third parties such as neighbouring First Nations, outside coloAPRIL 2020

If the Wet’suwet’en Nation has multiple governments arguing over who has authority and does not have decision-making processes in place for their citizens to make nation-based decisions, it’s difficult to support anyone. nial governments (municipal, provincial, federal, etc.) or with industry.

This Wet’suwet’en conflict is deeply rooted in their own internal conflicts and uncertainties. The same internal issues thrive with most First Nations in British Columbia and it’s the result of historically forced assimilation and colonization.

What happened in the past was awful and unfair, but we need to overcome it as First Nations people. No one is going to do that work for us; we must create our own laws and institutions again for our communities, children and future.

As someone with four Wet’suwet’en children that I love more than anything in this world, I pray the Wet’suwet’en people come together as one to create respectful and fair decision-making processes amongst themselves that the people can collectively respect, uphold and implement. This way they can be united when faced with opportunities or challenges within their homelands.

I wrote this piece with nothing but the utmost respect and love for the Wet’suwet’en people and all the other Indigenous people out there having similar internal struggles.

CMJ This was originally published as a public Facebook post by Chad Norman Day. He is the father of four Tahltan/Wet’swuet’en children who were born, raised, and still reside in Smithers.

CHAD NORMAN DAY is president of the Tahltan Central Government.

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FAST NEWS

Updates from across the mining ecosytem

• ELECTRIC VEHICLES |

Canada supports mine EVs with accelerated tax write-off

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uring this year’s Prospectors and Developers Association of Canada convention, Canadian Prime Minister Justin Trudeau announced the extension of an accelerated tax write-off to include a number of electric mine vehicles. The write-off will allow companies to expense the full cost of the equipment the year that it is put in use.

Although the government first introduced the ability to immediately expense the cost of clean energy equipment in its 2018 Fall Economic Statement, this did not include most of the electric vehicles used at mines.

The Mining Association of Canada (MAC) expressed support for the accelerated tax shield. “This announcement is welcome news for Canada’s mining sector and responds to one of MAC’s specific budget requests,” Pierre Gratton, MAC’s president and CEO, said in a release.

“Last year, Canada opened its first all-electric mine, and the deployment of electric vehicles across Canada is accelerating. Nonetheless, such equipment has a significant cost premium, so today’s announcement will help de-risk such purchases and accelerate the adoption of

• EQUIPMENT |

Prime Minister Justin Trudeau at this year’s Prospectors and Developers Association of Canada convention.

CREDIT: PRIME MINISTER’S OFFICE

electric vehicles at more mines.”

Benefits of electric vehicles at underground mines include lower ventilation requirements, less mine waste due to smaller excavations and lower greenhouse gas emissions.

“Just as miners know their materials are essential to the transition to a low-carbon economy, we also know we must reduce our own operational footprint,”

MacLean and GHH sign sales and support agreement

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ollingwood, Ont.-based MacLean Engineering has partnered with Germany’s GHH Fahrzeuge to provide mining, tunnelling and contracting companies with mobile equipment.

The two companies signed an agreement for mutual sales and support and announced their partnership at a ribbon-cutting event at MacLean’s first manufacturing plant outside of Canada – a 5,600-sq.-metre facility in Queretaro, Mexico.

The strategic partnership will be focused on the North American, Eastern European and Central Asian markets and will build on MacLean’s field service and sales support platform in Canada, the U.S. and Mexico.

GHH has an extensive branch network in Russia, Kazakhstan, Uzbekistan and India, which will support MacLean’s introduction of mining vehicles into these regions. The MacLean product line will be integrated with GHH’s load and haul offering to support mining and tunnelling operations.

“The combination of the MacLean and GHH product lines is a significant turning point for both companies, but in the context of

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Brendan Marshall, MAC’s VP of economic and northern affairs added. “This announcement underscores the government recognizes this and is committed to a sustainable extractive sector as a key component of Canada’s economy.”

According to the MAC release, Canadian mines supply some of the world’s lowest carbon-intensive nickel, copper and metallurgical coal.

CMJ

MINING JOURNAL

a global industry that is increasingly looking to reduce the complexity of supply chains to achieve better maintenance, total cost of ownership, safety and productivity outcomes, it simply makes good sense,” Kevin MacLean, the company’s president, said in a release.

“Leveraging MacLean’s already well-established network and experience, together with GHH’s years of design, development and application experience, we will provide customers with the total offering solution they require, as well as complete aftermarket support from upfront sale through the life of the machines,” added Jan Petzold, GHH CEO. MacLean Engineering’s mining division builds a comprehensive line of mobile equipment for mining cycle support across all underground mining methods in ground support, ore flow, and utility vehicle product categories.

GHH Group is a total-offering solution provider for the mining Industry. GHH develops and manufactures loaders, dump trucks and scalers.

CMJ

www.canadianminingjournal.com

• DIGITALIZATION |

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Vale selects Mobilaris and Epiroc for digital transformation

ale has selected Mobilaris Mining & Civil Engineering and Epiroc as partners to advance digitalization at its Canadian mines.

The announcement is part of the company’s digital transformation program within the mining area with the digitalization partnership aimed at enabling situational awareness for its workforce, equipment and consumables to ultimately increase safety and operational excellence.

The contract includes an integrated solution based on Mobilaris Mining Intelligence (MMI), a product portfolio that provides tools for enhanced safety, efficiency and productivity of mining operations. MMI enables superior situational and positioning awareness and is designed to visualize and support mining operations in real-time; it includes shift planning, scheduling, task information and reporting functions.

“With Mobilaris Mining Intelligence, we can provide digital solutions for smooth and seamless operations that define safer, more efficient ways of working,” Mikael

Vale’s digitalization team.

CREDIT: EPIROC

Nystrom, CEO of Mobilaris Mining & Civil Engineering said in a release.

With a technology-agnostic approach, the MMI platform is built on top of existing infrastructure through an automated and scalable process. The technology-agnostic feature is important in developing sub-surface network connec-

tivity; Vale recently began implementing an LTE infrastructure underground.

Epiroc develops and produces innovative drill rigs, rock excavation and construction equipment, and provides world-class service and consumables. The Mobilaris product portfolio is part of Epiroc’s product and service offering. CMJ

Nokia to deploy LTE network for Norcat • COMMUNICATIONS |

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okia will deploy its private LTE digital automation platform at Norcat’s underground centre in Sudbury, Ont., to establish an underground global mining innovation centre. Nokia is collaborating with Norcat and Canada’s Centre for Excellence in Next Generation Networks (CENGN) to deploy the network connectivity.

Nokia’s automation cloud will enable secure wireless communications between miners and surface personnel, including push-to-talk and push-to-video services.

The platform will also enable future applications, such as underground asset tracking, autonomous vehicles, and drone surveillance.

The Nokia Digital Automation Cloud will provide a high-bandwidth, lowlatency private LTE wireless network that will allow Norcat clients to develop, test and demonstrate emerging technologies.

CMJ APRIL 2020

Preventable.

Prevented. .com

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PDAC 2020

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ESG trends to watch

MINING JOURNAL

www.canadianminingjournal.com

INVESTOR FOCUS ON ESG CONTINUES TO INTENSIFY

By Alisha Hiyate

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ith growing demand from investors for environmental, social and governance (ESG) related data and an ever-increasing number of ESG standards and frameworks, it can be confusing and difficult for miners to figure out what information is important and how to report it. But according to a panel on ESG at this year’s Prospectors and Developers Association of Canada (PDAC) convention in March, it’s worthwhile for companies to make the effort.

Moderated by Erica Coulombe of the advisory firm Millani, here are five takeaways from the expert panel.

1

ESG is here to stay The current attention to ESG is part of a new approach to assessing investment risks and opportunities that looks beyond financial statements, said Ani Markova, a director of SilverCrest Metals and Golden Star Resources.

“There has been a huge investor demand for ESG sustainability related investments, not only in the equities but in the bond markets as well with green bonds and sustainability linked investments,” she said. “We have seen a big shift in the philosophy behind financial analysis from a simple analysis of income statement and balance sheets to a more complex labyrinth of factors, including the ethics of the organization, the competitive advantages and the culture, which are more intangible assets.”

As for why this shift is taking place, Markova noted that investors have the

fiduciary duty to integrate financially material factors, including these ESG factors in their investment decisions.

In fact, investors themselves are being judged on how and whether they are collecting and considering ESG data.

“All these asset owners and asset managers are now required to disclose annually to the UNPRI (UN Principles for Responsible Investment) what are they doing in terms of integrating those ESG factors in their investment process and how are they engaging with the companies,” she explained.

2

Mining has a long history with ESG Although the current intense focus on ESG is a newer trend, in and of itself, it’s not a new thing for miners.

Although the mining industry suffers from the percep-

CONTINUED ON PAGE 14

Left and above: Images from this year’s PDAC conference. CREDIT: CANADIAN MINING JOURNAL Right: At Golden Star Resources’ Prestea mine in Ghana. CREDIT: GOLDEN STAR RESOURCES APRIL 2020

CANADIAN MINING JOURNAL |

13

PDAC 2020 tion of being a laggard in ESG efforts, Nicholas Cotts, senior vice-president, external relations and social responsibility, with Newmont pointed out that the mining industry has actually been foundational to the ESG agenda today.

“Back in the ‘80s when I started working in the mining sector, the ESG morphology was health, safety and loss prevention and environmental management. It was really what were companies doing to protect their people and what were they doing to stay in compliance with the laws and regulations that existed,” he said.

In the 1990s, the concept of social licence emerged.

“Fast forward to today – we have the concept of environmental stewardship, health and safety, transparency, ethics, supply chains, social performance, local procurement, human rights, it goes on and on.”

He added: “What’s changed is how companies are being asked to validate, to measure, to assure that information and that performance on the ground and how we are communicating that information out to an incredibly broad set of stakeholders.”

3

The proliferation of reporting standards The ever-increasing number of ESG reporting frameworks can easily prove overwhelming for miners, especially juniors.

There’s the Global Reporting Initiative (GRI) Standards, CDP

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(formerly Carbon Disclosure Project) questionnaires, the World Gold Council’s Responsible Gold Mining Principles (RGMPs), International Council on Mining & Metals (ICMM) Performance Expectations, the IFC Performance Standards; Dow Jones Sustainability Index (DJSI), and more.

“We all hear all the time how complex it is to navigate through all the standards in existence today. My impression is that we’re starting to see some convergence of those,” said Markova, noting that the World Economic Forum published a paper towards common metrics and consistent reporting and sustainable value creation earlier this year.

“But what I want to emphasize is that it will look overwhelming when you see how and what investors are looking for, but I encourage you to think about what is material to your business.

What has a financial impact, both positive and negative?”

Gus MacFarlane, vice-president of Verisk Maplecroft, said that while investors are often looking at corporate-level data, most of the risk for miners are likely to manifest at site level.

“ESG data tends to be in corporate-level terms, which has the ability to disguise an awful lot of site issues, which can be of an extreme nature,” MacFarlane noted.

There’s a need for companies to disclose both raw data for in-depth analysis and corporate-level data that can be used more broadly to compare businesses across industries.

Newmont’s Cotts noted that while it is a challenge to manage the ever-increasing ESG data requests and reporting requirements, companies can’t become distracted from what’s important – performance at the mine site level.

“We have to find that right balance – while we want sitebased information, we don’t want to burden sites with gathering info. So we have to find the right-sized systems and how we collect that information in a way that’s helpful to the sites.”

Newmont is attempting to accomplish that by designing information data collection systems at the corporate level, and then adjusting them or co-building them with the sites so they can use the information to make better decisions on a day to day basis. “If we can find that happy medium, then we’re creating value for the sites, we’re not just putting more work onto them,” Cotts said.

Jeff Geipel, founder and director of Mining Shared Value said that while companies are concerned about reporting being a burden, the sector’s experience with health and safety proves that reporting can work to drive performance.

“Health and safety performance has improved drastically and to be brutally honest, it’s not because of increasing sanctions on companies for poor performance, it’s more self-performance increments through things like recording and making it omnipresent,” he noted.

“You can’t look at reporting as a burden, you should actually look at it as a value creation opportunity,” Geipel said, adding that the benefits are many, including a lower cost of capital.

4

The need for harmonization One issue that comes with the proliferation of ESG frameworks has been a need for standardization. As is stands, the www.canadianminingjournal.com

same company can rank very well in one set of standards and very badly in another.

MacFarlane detailed several factors that are causing data gaps and divergent assessments as well as wasted effort when it comes to ESG data. First, he explained, there needs to clarity on what you’re trying to measure – is it ESG impacts, or ESG risks? Is it short-term operational issues or long-term strategic issues?

Impacts on specific stakeholders or entire systems, like ecosystems? Second, the proliferation of disclosure frameworks and ESG standards, in addition to surveys and questionnaires coming from the rating agencies, investors, can cause confusion. “This can make for quite a baroque mess of definitely unsound advice that investors are trying to navigate their way through,” MacFarlane said.

And third, while there is a lot of quantitative data when it comes to the environment portion of ESG, the social and governance components are necessarily going to involve qualitative data where definitions will need to be checked and direct comparisons may become difficult.

A lack of context can also make the data less useful, said MacFarlane: Is the operation in the Atacama Desert in Chile or in Ghana where oversupply of water is an issue?

In the end, Newmont’s Cotts recommends doing as the gold major has, which is: “Being purposeful in evaluating and selecting the initiatives that we align with and then ignoring everything else.”

Markova had similar advice.

“There is a big discrepancy in rating agencies’ data and ratings, and this is really a challenge,” Markova noted. “What I want to emphasize is how important it is to pick the right framework and the protocol for your business because that imposes discipline in oversight. Investors and others really want to know the relevant disclosures that will give them the comfort they will achieve their investment returns.”

5

The climate wild card Although the environmental, social and governance data and their challenges are generally well understood, and companies are aware of what improve-

APRIL 2020

ments are necessary, climate change is an exception.

That’s partially because of regulations that are expected to be enacted in the near future, Markova said. “Climate patterns are changing very fast, and we can’t just pick up our mines and move them somewhere else, but also, the regulation that’s coming country by country will

impact us in a very significant way.”

Investors are concluding that the world will not meet the Paris Accord climate targets, and therefore a temperature rise beyond 2 ° Celcius is likely, she added.

“This is why you’re seeing so many investors focus on climate change – because we can’t get those targets in CMJ place,” Markova said.

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COSTING

Exploding costs: AN ANALYSIS OF GALORE CREEK

By Brad Terhune

T

he mining industry is fraught with capital cost overruns. A quick internet search will turn up many examples. The results quickly highlight that as many as two-thirds of mining projects see cost overruns. Moreover, the researcher can see that it is a decadeslong problem. That is, the industry doesn’t seem to be getting better at their cost estimating. We aren’t learning from our mistakes.

16 | CANADIAN

MINING JOURNAL

Where does the problem lie?

Our industry’s cost overrun problem is multi-faceted. There isn’t a single reason or error that we can definitively say is the key to the solution. Poor engineering assumptions, a lack of understanding of key risks (either actively choosing to “kick the can” or a simple failure to recognize risks), bias (both intentional and unintentional), aggressive timelines, and other reasons may play a role. These issues can contrib-

ute to cost overruns individually, although they more commonly occur in tandem.

To highlight a single, yet profound example, consider Teck and Newmont’s Galore Creek project in northwest British Columbia. All of the information presented below is publicly available via company or securities websites. It is representative of the company and project information that would be available to investors. www.canadianminingjournal.com

Drill core at a remote exploration project. Credit: Adrian Wojcik, iStockimages.com

Our industry’s cost overrun problem is multi-faceted.

There isn’t a single reason or error that we can definitively say is the key to the solution.

Project example The Galore Creek project is an alkalic porphyry copper-gold-silver system with at least three mineralizing events that deposited bornite, chalcopyrite, gold, silver and other base metals, primarily in association with potassic alteration.

Exploration and development are difficult due to its remote location and helicopter-only access.

The project was originally discovered

by Hudbay Mining in 1955 and has since been explored and partially developed by several companies. NovaGold was the 100% owner immediately prior to June 2007, however it has since divested itself in full, via an initial partnership with Teck Resources in 2007, followed by a more recent agreement with Newmont.

The project is currently being worked by a partnership of Teck and Newmont under the name Galore Creek Mining Corp.

The first assessment of the development potential for the project was completed by Kennecott in 1992, but this example focuses on information from the

last three publicly available studies of the project: • 2004 preliminary economic assessment • 2006 feasibility study • 2011 pre-feasibility study The 2006 study resulted in the first declaration of reserves on the property. Permits were obtained and initial development (pre-construction) activities began based on this study. Then a third-party review of costs and work completed in 2007 (after a new partnership with Teck) showed that the economics of the project were ultimately not favourable. Development activities were halted at that time, with the stated reasoning for the stoppage focused primarily on the complex sequencing related to the construction of the tailings dam and water management features. As we will see shortly, there was a much larger concern that likely played into halting development.

CONTINUED ON PAGE 18

TABLE 1

2004 PEA

2006 FS

2011 PFS

Reserves

–

540.7 Mt @ NSR of CA $3.82/t

528 Mt (see grades below)

M&I Resources

285.9 Mt (0.5% CuEq Cut-off)

749 Mt (0.25% CuEq Cut-off)

286.7 Mt @ NSR cut-off of $10.08/t

Inferred Resources

98.8 Mt (0.5% CuEq Cut-off)

300 Mt (0.25% CuEq Cut-off)

346.6 Mt @ NSR cut-off of $10.08/t

Grade Reserves

–

0.55% Cu, 0.303 g/t Au, 5.32 g/t Ag

0.58% Cu, 0.32 g/t Au, 6.02 g/t Ag

M&I Resources

0.73% Cu, 0.44 g/t Au, 5.7 g/t Ag

0.52% Cu, 0.3 g/t Au, 4.9 g/t Ag

0.33% Cu, 0.27 g/t Au, 3.64 g/t Ag

Inferred Resources

0.54% Cu, 0.37 g/t Au, 4.8 g/t Ag

0.37% Cu, 0.21 g/t Au, 3.7 g/t Ag

0.42% Cu, 0.24 g/t Au, 4.28 g/t Ag

Production

30K tpd

65K tpd

95K tpd

Mine Life

23 years

22 years

17.6 years

Strip Ratio

1.75

1.64

2.16

Processing

Conv. crush, grind and float.

Conv. crush, grind and float.

Conv. crush, grind and float.

Recoveries

90% Cu, 70% Au, and 80% Ag

90% Cu, 72% Au, and 64% Ag

91% Cu, 73% Au, and 64% Ag

Road/Tunnel Km

72/17 or 158/4

135/4.3

69/13.6

APRIL 2020

CANADIAN MINING JOURNAL |

17

COSTING TABLE 2 2004 PEA

2006 FS

2011 PFS

Accuracy

+/- 25%

+15%/-10%

+25%/-20%

Contingency

20%

13.30%

18%

Mine

$153 M

$457 M

$357 M OR $582 OR $939M

Plant

$170 M

$410 M

$835 M

Infrastructure

$236 M

$330 M (w/ tunnel, 2 yrs)

$697 M

Tunnel

$165 M (3 yrs)

Included above

$580 M (4 yrs)

Sum Direct

$560.4 M

$1.44 B

$2.47 B

Sum Indirect

$131 M

$446 M

$1.30 B

Total CAPEX

$828 M

$2.23 B

$5.16 B

After tax NPV

$23M (5% discount)

$599 M (5% discount)

$137 M (7% discount)

After tax payback

4 yrs

4 yrs

7.8 yrs

After tax IRR

5.70%

10.60%

7.40%

CAPEX

Economic Analysis

Note: The 2011 mine capital cost is uncertain due to inconsistencies within the report. The true value may be one of those stated in the report (shown) or a different value altogether. All dollars are Canadian.

The increases in tunnel and infrastructure costs between 2006 and 2011 are substantial and not easily explained.

FIGURE 1

$1.5

n Mine

$1.2

n Plant n Infrasture

$0.9

n Tunnel n Indirects

$0.6

In 2008, the mineral reserves were reclassified back to mineral resources and an optimization study was implemented.

Then, in 2010-2011, Galore Creek Mining Corp. commissioned several consultants to help it with a new pre-feasibility study, which is the last publicly available report on the project.

The following tables highlight the cost inflation at Galore Creek over the seven-year span covered by the latest publicly available reports. Table 1 shows the key project characteristics over time and Table 2 outlines the costs associated with each scenario.

If the costs shown in Table 2 are charted (Figure 1) and we consider the underlying project parameters in Table 1, we can begin to understand the capital cost progression at Galore Creek. The increases in mine development and plant 18 | CANADIAN

MINING JOURNAL

$0.3

$0.0

2004 PEA

2006 FS

costs are expected due to the higher production levels assumed for each subsequent study. (The actual increase in mine costs is uncertain due to reporting inconsistencies.) However, the increases in tunnel and infrastructure costs between 2006 and 2011 are substantial and not as easily explained. These costs were dramatically understated in the earlier reports due to risks and scheduling not being well understood, as they pertain to the tunnel and other infrastructure aspects. With specific regard to the tunnel, the construction period was re-eval-

2011 PFS

uated and time for completion moved from two years to four years. That is a huge oversight. Timelines for the water management features changed as well due to elaborate build sequencing.

These types of oversights, or lack of investigation into the risks of a project earlier in its development, can have significant impacts on the total estimated capital costs associated with project development. In the Galore Creek example, the total estimated capital cost increased a whopping 131% between 2006 and 2011. (Figure 2) www.canadianminingjournal.com

FIGURE 2 TOTAL CAPITAL

TOTAL CAPITAL

TOTAL CAPITAL

0.828

2.23

5.15

2004 PEA

2006 FS

2011 PFS

What needs to happen?

The Galore Creek example highlights that companies should be making efforts to better understand their project risks (technical, market, government, etc.) and the potential effects they may have on costs. Similarly, investors and financing houses should require and/or carry out more intensive due diligence work and conduct more thorough cost estimates earlier in a project’s life. The end game for this additional work is a better project, from both technical and cost perspectives.

What would happen if the industry suddenly shifted to better projects? Industry credibility would improve, projects would advance, and the currently narrowed

The Galore Creek example highlights that companies should be making efforts to better understand their project risks (technical, market, government, etc.) and the potential effects they may have on costs.

financing options would potentially be reinvigorated. Unfortunately, closing the gap between estimated costs at the study level and the actual costs of development is not an easy task. Individuals and companies would need to commit to understanding their project risks with real time and real dollars, while also braving the prospect of having to condemn their own projects.

For the Galore Creek example, the publicly available information paints a bleak picture of its economic feasibility.

However, it is clear that NovaGold was able to drum up interest in the project from two very significant multinational mining companies. Perhaps there is

more privately available information that would help us understand their interest in such a property, but this leads to my final point. What is your typical investor to do if all of the information isn’t at their disposal or if the public reports are of poor quality? If we want to see funds come back to the industry from the marijuana industry, and others, the onus is on us to improve reporting and to regain the confidence of the investor.

CMJ Brad Terhune is a cost analyst and senior geologist with CostMine (www.costmine.com), a division of Glacier Resource Innovation Group. He can be reached at bterhune@glacierrig.com or 509-328-8023.

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WATER MANAGEMENT

CONSIDERING

Climate change How tailings ponds designs are changing to factor in extreme weather

By Janice Leuschen

Photo: rippinlines, iStockimages.com

T

he unpredictable intense rainfalls that are part of climate change mean people who design tailings facilities must adjust their design plans to ensure that those facilities can handle the increased water.

“Considering weather and climate is not new,” said Charles Dumaresq, vice-president of science and environmental management at the Mining Association of Canada (MAC). “It has been part of best practices around engineering, planning and design for tailings facilities for a long time. The change is that you can no longer rely on the past fifty years of climate to tell you what the next fifty years are going to be.”

The intensity duration frequency (IDF) curves, which are derived from past rainfall events and used as a source of data for designing tailings facilities, are becoming out of date because of APRIL 2020

Unfortunately, the effects of climate change (means) storms are becoming more intense, more frequently.

– KEN BOCKING, GEOTECHICAL ENGINEER, GOLDER ASSOCIATES

climate change and no longer a reliable source of data.

“Unfortunately, the effects of climate change (means) storms are becoming more intense, more frequently,” said Ken Bocking, a geotechnical engineer with Golder Associates that has 32 years of experience in designing tailings facilities. “So clearly the design criteria we use for the spillway needs to be CONTINUED ON PAGE 22

CANADIAN MINING JOURNAL |

21

WATER MANAGEMENT

With new facilities, we’ve increased the amount of water above and beyond the design criteria; typically it’s around a twenty per cent increase.

– LUCIANO PICIACCHIA, DIRECTOR EARTH AND INFRASTRUCTURE AT BBA CONSULTANTS

upgraded and changed.”

Spillways are designed to prevent the overtopping of a tailings facility, but not necessarily to handle a thousand-year return storm.

“Now hydrologists must look at more recent rainfall events and that would tend to shift the IDF curves,” he said. “The climate scientists have to give us guidance on that.”

While climate scientists can predict temperature rises for different scenarios, he added: “It’s not so clear in terms of rainfall.”

Luciano Piciacchia, director earth and infrastructure at BBA Consultants, has developed his own formula for calculating the capacity of new facilities.

“With new facilities, what we’ve taken to doing is we’ve increased the amount of water above and beyond the design criteria,” he said. “Typically, it’s around a twenty per cent increase that gets added to it.”

For example, the capacity for 2 million cubic metres of water is now increased to 2.5 million.

“But there’s not a scientific basis behind that,” Piciacchia said.

“It’s a bit of guess work. There are no exact criteria (outlined) by 22 | CANADIAN

MINING JOURNAL

regulations when we are looking at including climate change.”

Piciacchia believes that getting more accurate weather data from closer to the site is the key to designing new tailings facilities. Currently, meteorological stations could be as far away as 100 km from the site and not be accurate for the proposed mine site.

“There are ways of transposing that data, but every time you do that, it dilutes the accuracy of what you are doing,” Piciacchia said.

Meteorological stations at the site would provide more accurate data for the planning of tailings facilities and reduce the risk of building a facility that can’t handle extreme rainfall.

Piciacchia suggests pointing out at the prefeasibility level that the nearest meteorological station is too far away to get accurate data for designing the best facility. The may result in a new station being erected so that more recent and more accurate data can be collected.

“You can use the most recent data that you have,” Piciacchia said. “Then you come up with a model that says this is what we are going to design to.” www.canadianminingjournal.com

Snowfall and thaws Extreme rainfall is not the only challenge for tailings facilities designers. Increasing rainfall, snowfall and thaws during the winter are also a problem.

“That typically happens in the spring when you have a big snowpack and then it rains on top of it and melts it,” Bocking said. “So, design must consider snow as well.”

Thaws as early as February are now possible.

For existing tailings facilities, upgrades could be completed to accommodate extreme rainfall.

“You can take an existing tailings basin and even one that’s closed, and you can look at its stowing capacity,” Bocking said.

“You could upgrade the stow and make it wider, for example.”

A lack of rainfall can also be problematic, because some tailings facilities require rainfall to keep water on top of the tailings to prevent acid generation.

“A drying effect would be negative in that situation,” Bocking said.

With warming temperatures, mines in northern Canada, which is warming at about twice rate of the planet, have other concerns.

“There are a few dams, typically way up north, that have frozen cores,” Bocking said. “They rely on frozen temperatures to keep the dams impervious. As temperature rises, at some point they will thaw and become pervious.”

According to Bocking, only a few of these exist and they tend to be in the high Arctic, where the mean annual temperature is -12° Celcius.

“The temperatures would have to rise to about -4° Celcius globally before we have a lot of thawing,” Bocking said. “Going forward, I think people will stop designing frozen core dams.”

Reducing tailings One solution to the management of tailings would be to significantly reduce tailings. But both Bocking and Piciacchia agree they can’t be completely eliminated.

“We can reduce tailings, but we can’t get rid of them,” Piciacchia said. “We always look at the opportunities, but the opportunities are going to be few and far between.”

Currently, there’s some emphasis on dry-stacking tailings, in which tailings are dewatered and placed in a tailings management facility.

“It makes for a small footprint facility, which is a good thing,” Piciacchia said. “But it’s not necessarily the best technology for acid-generating tailings.”

Another solution would be to backfill the tailings.

“When you take ore out of the ground and grind it up, you are increasing its volume, so you cannot possibly get all the tailings back underground,” Bocking said.

CONTINUED ON PAGE 24

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WATER MANAGEMENT

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Bocking and Piciacchia both said the best they’d seen done was about 50% of the tailings backfilled.

“To be fair, people don’t do backfilling to reduce the volume on surface, they do it for other economic reasons,” Bocking said.

“It’s very expensive, so they do it to increase ore recovery.”

Industry guidance With funding through Natural Resources Canada, MAC has been working on a guidance document, Guide to Assessing and Incorporating Climate Change into Decision Making for the Mining Sector.

“This document was developed to address a need for more detailed guidance in this area,” Dumaresq said. “Regulators and others are increasingly asking questions about climate change adaptation. Companies recognize the importance of it, but there has been a lack of guidance at this level of detail to help inform site-specific decisions.”

He hopes the document will focus the discussion more constructively around, “How do we do this?”

The goal is to have users understand they can use multiple tools, because each one has its own inherent strengths and weaknesses. Then users can choose the best data set to make informed decisions with climate change in mind.

“Collectively, they are going to give you a picture and an

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MINING JOURNAL

To prevent overtopping of tailings facilities, the people designing tailings facilities must take climate change into account. idea,” Dumaresq said. “If you use multiples, that essentially becomes your crystal ball.”

Working through the suggestions and best practices outlined in the document will help people conduct a risk assessment for each mining site, including many vulnerabilities, as well as climate change. More data collection will help people understand a particular vulnerability.

“We don’t want to put the document out on our website and forget about it,” Dumaresq said. “We need to think about it within our own membership and potentially within the industry more broadly, how do we increase awareness of the document?

How do we actually get people using it?”

As people use the information in the guidance document, Dumaresq foresees the potential for updates down the road as more experience in implementing it is gained and as the broader science continues to evolve.

The guidance document will be available for free download from the MAC website in mid-summer.

The International Council of Mining and Metals (ICMM) also released its own document: Adapting to a Changing Climate – Building Resilience in the Mining and Metals Industry, in November 2019. MAC closely aligned its document with this one. Both address climate change as it relates to tailings facilities, as well as other issues around climate change and its effects on mining operations.

“Nothing out there covers best practices like our document,” Dumaresq said. “It’s more Canadian-specific, but applicable anywhere.”

To prevent overtopping of tailings facilities, the people designing tailings facilities must take climate change into account.

“As tailings engineers, we have to pay attention to climate change,” said Bocking. “It’s real and it has important effects on the rainfall events in particular, and we have to adjust our design CMJ parameters to deal with it.” www.canadianminingjournal.com

WATER MANAGEMENT

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he Canadian regulation for mining effluent discharge mainly focuses on toxicity of the final effluent to the receiving body. One of the main objectives of the regulation was for the water to be non-toxic for the greater daphnia (Daphnia magna) and for the rainbow trout – two surface-water fish species. There was, therefore, no possibility to discharge saline water because salinity is toxic to these two fresh water species. However, this situation changed in June 2018 as the Canadian water management regulation was amended and renamed the Metal and Diamond Mining Effluent Regulation.

Among many changes, the amended regulation allows for discharge of a mine effluent in a marine environment by adding the threespine stickleback (Gasterosteus aculeatus), a brackish APRIL 2020

water fish, to the acute lethality testing protocol. Hence, acute lethality testing may be done either in saline water conditions with the threespine stickleback CREDIT: VEOLIA or in fresh water with the rainbow trout and the greater daphnia.

The amended regulation provides more flexibility with respect to water management for mines that have the opportunity to discharge in saline water.

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CANADIAN MINING JOURNAL |

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WATER MANAGEMENT ters, most notably metals and ammonia. Metals removal is achieved by physico-chemical processes.

However, ammonia is a complex toxicity source to address with standard physico-chemical methods. Ammonia treatment remains a challenge and few technologies are available as chemical and physical processes (e.g. the break point chlorination, stripping). In many applications, biological treatment is known to be a good solution to address ammonia toxicity. However, little reference could be found for ammonia removal in saline water effluents.

Biological treatment for ammonia removal Biological treatment was intensively investigated in fresh water effluent. In surface water, ammonia removal can be addressed using a biological treatment such as a moving bed bioreactor (MBBR). Supported by more than 35 years of continuous research, development and process expertise, Veolia’s trademarked AnoxKaldnes MBBR Veolia’s AnoxKaldnes moving bed bioreactor (MBBR) technology provides a resilient solution for biological is a compact fixed-film technology degradation of ammonia. CREDIT: VEOLIA that provides a resilient solution for biological degradation of ammonia.

It also offers a better resistance to toxic shocks and adapts to g/L using tap water, with a composition similar to surface water various operating conditions (moderate loading variations, cold composition available on site. The biological treatment was fed water operation). An added benefit of applying the AnoxKaldnes with a mining effluent at 30 g/L of salinity.

MBBR for ammonia removal is that it has proven to require limA six-month biological treatment trial was conducted on the ited chemical dosages and maintenance. The MBBR has proven saline water effluent, with ammonia concentration up to 50 mg to be an interesting solution for Canadian wintery conditions in N/L (after dilution). The behaviour of the biomass growth in many mining applications. saline conditions as well as start-up strategies were the main Veolia conducted a laboratory study in collaboration with a focus of the development of this new MBBR application. The northern mining site in order to determine if the MBBR tech- mining effluent was poor in bacteria, so a municipal sludge was nology could be applied in a saline water effluent. The objec- used to seed the biological treatment. While this is probably tive of the laboratory study was to determine the possibility of not mandatory, this helped speed up the process start-up. In operating a biological treatment in saline water conditions and order to help the development of an adapted biomass, the mine to determine the influence of the water salinity on the biomass. effluent was diluted to brackish water conditions to start the The study mainly focused on the establishment of the complete biological treatment. nitrification of ammonia (from ammonia to nitrate) in saline water and to achieve a non-toxic effluent to the threespine Key features of the saline biological treatment operation stickleback.

Ammonia oxidation to nitrite was quick to establish itself in brackish water conditions, as is often observed in surface water Methodology applications. However, when salinity was increased too quickly, The mining effluent used for the laboratory study contained it resulted in the loss of ammonia removal and the detachment both high salinity and ammonia concentrations due to the use of all the biomass on the MBBR carriers. A gradual increase of explosives in underground mine operations. The salinity of in salinity to the biological system was required to prevent losthe mine effluent was higher than the salinity expected in the ing ammonia oxidation efficiency. After an appropriate rate sea. As such, the mining effluent was diluted to a salinity of 30 of salinity increase, the AnoxKaldnes MBBR achieved stable 26 | CANADIAN

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www.canadianminingjournal.com

ammonia removal efficiency at 30 g/L of salinity.

The salinity was shown to have a greater impact on the bacteria responsible for the nitrite oxidation; complete nitrite oxidation to nitrate was achieved after six months of operation.

During acclimation of the nitrite oxidizing bacteria, ammonia loading was slowly increased. At the end of seven months of operation, final ammonia loading was similar to the ammonia loading usually applied to a newly commissioned AnoxKaldnes MBBR system in a surface water application.

Once the biological process was fully acclimated, the biologically treated mine effluent was subjected to a toxicity test.

The result has shown the effluent not to be acutely lethal to threespine stickleback (0% mortality). The final ammonia and nitrite concentrations were below 1 mg N/L. New leads to explore In the coming years, reduction of nitrate concentration in the mine effluent will also become an important part of pollution reduction. Nitrate is indeed known to be an important source of eutrophication in natural surface water, thus leading to more stringent regulations to limit the impact of industrial activities on the environment. During acclimation of the nitrite oxidation bacteria, a side test was conducted to determine the efficiency of denitrification (biological reduction of nitrate to nitrite and

Veolia conducted a lab study in collaboration with a northern mining site to determine if the MBBR technology could be applied in a saline water effluent. of nitrite to nitrogen gas). The side test was run for a limited period (two months). Through these two months, nitrate reduction to nitrite was observed but reduction of the nitrite concentration was only partial. Since an extended acclimation period was required for nitrite oxidation in the nitrification reactor, Veolia is expecting a similar conclusion for the denitrification success in saline water effluent.

Conclusion The testing completed in Veolia’s laboratory has shown great promise for ammonia removal in a saline water mine effluent and highlights the possibility to provide a complete nitrogen removal biological system (nitrification + denitrification) in saline water effluent. Once the start-up of the process was well understood, the efficiency of the MBBR system proved to be as efficient as surface-water applications. Thus, the AnoxKaldnes MBBR technology can provide a robust and low-maintenance solution for nitrogen removal in saline water mining application. CMJ

The Coronavirus (COVID-19) pandemic is a great concern for you and your families. At this time Glacier Resource Innovation Group wants you to know that the well being of our valued customers, business partners and employees is of the deepest concern to us. With this in mind we have already and will continue to take measures to protect all parties we are in contact with. We value your business and our goal is to ensure that we continue to provide you with a high level of service during this uncertain time.

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APRIL 2020

CANADIAN MINING JOURNAL |

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DEWATERING technology › P29 High-volume dewatering solutions value from waste › P32 Creating through tailings reprocessing

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www.canadianminingjournal.com

By Todd Wisdom

| DEWATERING TECHOLOGY

Tracked conveyor bridge, versatile mobile stacking technology, mobile conveyors and advance and retreat stacking. CREDIT: FLSMIDTH

Advances in tailings tech

FLSMIDTH TALKS HIGH-VOLUME DEWATERING SOLUTIONS

E

conomic growth, urbanization and growing populations are fuelling demand for new urban infrastructure, technology and modern conveniences. These factors, especially in developing economies, are lifting more and more people out of poverty and into a swelling middle class. This demographic change means hundreds of millions more people with disposable income, which in turn is fuelling consumption and placing more and more demand on the mining industry to deliver material to the market.

With a concurrent move towards energy efficiency, green technology and a low-carbon future, we are seeing stronger

APRIL 2020

demand for electric cars, wind and solar energy and energy storage. Meeting these demands requires minerals, which places the mining industry at the centre of a complex conundrum.

Declining ore grades, increasing environmental footprint The difficulty in delivering the minerals demanded by society while decreasing the environmental footprint is being compounded by declining ore grades. This has direct implications for the amounts of water and energy needed for production, increasing the environmental footprint of the mine. It is a challenge, but CONTINUED ON PAGE 30

CANADIAN MINING JOURNAL |

29

DEWATERING TECHOLOGY it also creates opportunities for us to be part of the solution.

Processing more ore to recover needed metals directly increases the amount of tailings produced from a mine. Tailings management facility (TMF) failures are perhaps the most significant environmental liability for a mining project. In fact, tailings management was listed as the only direct flowsheet risk in KPMG’s 2020 Global Mining Survey Report of top 10 risks facing the mining industry.

High-profile dam failures in Brazil in recent years have highlighted the consequence of TMF failures, including human, economic, and environmental impact and cost, reparations and liabilities running into the billions of dollars, reputational damage and market capitalization devaluation. On average, over the last 30 years, TMFs have experienced around 20 dam failures per decade and a third of them caused serious safety and environmental liabilities, including deaths.

Add to this the fact that access to water is becoming increasingly difficult and mining operations have seen water costs steadily rise. In short, water availability and water contamination are challenges miners have faced for some time, and this trend will only grow in the years ahead, creating huge financial and operational risks.

Two FLSmidth workers examine a large filter cake during a customer demonstration in 2019.

CREDIT: FLSMIDTH

Dewatering tailings using pressure filters has been around for a while, but traditional filtered tailings costs are currently too high for high-throughput, low value per tonne ore deposits.

Change is in the water Techniques for dewatering large tonnages of tailings, with minimal operational costs and making use of economies of scale, through larger equipment are continuously being sought. A safe and cost-effective solution for tailings management facilities capable of accommodating 150,000 t/d is needed.

Dewatering tailings using pressure filters has been around for a while, but traditional filtered tailings costs are currently too high for high-throughput, low value per tonne ore deposits. Typical filtered tailings using smaller pressure filters and air drying the filter cake to an optimum cake moisture content, and then using trucks for tailings transport and placement has an in-place cost of over US$4 per tonne. For large-scale, low-grade open pit mines, this cost is too high.

To reduce costs associated with dewatering tailings using pressure filters technology, three main problems need to be solved. The first is low filter press volume per filter. Filter presses are a batch process and low volumes per batch mean low production rates per filter. Second relates to maintenance and availability, and lastly, you have slow cycle times, which reduces batches per hour.

Low filter press volume per filter The solution to low filter press volumes is to increase the plate size and increase the number of filter chambers in the filter press.

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Larger filter volumes have many benefits, such as a need for fewer filters, fewer support components, reduced number of filter cloths to change and handle.

Resolving this was the main driver, for instance, in FLSmidth’s design of a filter that includes a filter plate with dimensions of 5 metres high by 3 metres wide and 160 chambers, that meant a filter volume of over 90 cubic metres and over 4,000 sq. metres of filtration area.

Intensive maintenance and low availability Most maintenance on a filter press is associated with the filter cloth and filter plates. Filter cloth has a typical lifetime of around 3,000 cycles on most mineral flotation tailings. This leads to changing the filter cloth on the filter approximately twice per month, depending on how often the filter is operated.

High availability, however, can be achieved by performing the cloth and plate maintenance outside of the filter press.

Current filter presses can achieve over 90% availability utilizing this method. It is envisioned for the 5 by 3-metre filter that plate cassettes of 10 will be removed and maintained outside of the filter. As soon as the dirty filter plates are put into the maintenance rack, new clean plates are lifted into the filter allowing the filter to operate while the dirty plates are maintained. As the cloth and plate maintenance is performed outside the filter, while the filter is operating, high availability of the filter is maintained. The total downtime to remove a set of plates and reinstall a set of plates has been measured in an operating filter to be 10 minutes. www.canadianminingjournal.com

Top: Mobile stacking technology for dry stack tailings: tracked conveyors and a mobile bridge conveyor transfer to stacker. Below: An FLSmidth worker takes a sample of filter cake. CREDIT: FLSMIDTH

Slow cycle times For most flotation tailings, total cycle times of less than eight minutes can be achieved if both the process and mechanical times are minimized. Mechanical times can be minimized by opening the complete plate stack all at once, maximizing the speed of the opening and closing, performing valve openings and closings in a parallel method when possible and optimizing cloth washing and cloth shaking times when possible.

Process times can be minimized by four actions: Fill the filter at high pressures, eliminating the use of membranes for squeezing the cake, reduce or eliminate cake air blow and optimize feed pumping control to take full advantage of pump flow and pressure capacities.

The fast cycle times and a rapid filtering process is referred to as “Fast Filtering” and allows more batches per hour and higher unit filter capacities. However, if the cake airblow time is reduced, it may also reduce the volume of water removed from the filter cake produced. The resulting higher cake moisture content, typically between 18 – 20 wt% moisture, introduces potential geotechnical issues within the TMF. To give the TMF the required strength needed when APRIL 2020

the higher cake moisture tailings are deposited, FLSmidth came up with the EcoTails process, which co-mingles waste rock with the tailings. Mixing the low moisture waste rock with the higher moisture tailings gives a product with an average moisture that is acceptable for stacking.

The coarser rock particles also add shear strength and provide a higher density to the pile the tailings are fast filtered with, with the blending taking place during conveying transportation. To get the waste rock on a conveyor, in-pit crushing and conveying (IPCC) can be used which will further improve mine economics and reduce truck emissions for additional sustainability advantages. EcoTails mix ratios are designed for individual mine site requirements, producing a material that is geotechnically and geochemically stable.

Calmer waters ahead?

With the traditional technical challenges faced by large-scale filtration and dewatering gradually melting away through innovation and ambition, the mining industry need not see more sustainable water usage as an insurmountable challenge.

Cost analyses, considered over the full lifetime of a mine, are also likely to show that new solutions like EcoTails are actually cost competitive compared to wet tailings dams under many conditions, leaving the main challenge as the industry’s willingness to adopt these methods.

CMJ Todd Wisdom is director of Tailings with FLSmidth.

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DEWATERING TECHNOLOGY

Creating value from waste

Metso discusses why tailings reprocessing is key to the mining sector’s future

By Niclas Hällevall

F

or some time already, ore reserves have been depleting with mines going deeper. Huge volumes of waste, or tailings, are being generated with the growing need to process more and more ore. And recent devastating tailings dam failures have brought safety and environment concerns to the forefront, thereby increasing the pressure to search for alternatives. There have also been stronger regulatory compliances affecting the social licence to operate in many regions.

Though the industry has been taking positive steps to become more responsible towards local community welfare with optimum utilization of natural resources, many significant challenges still remain.

Metso has launched a new tailings

Metso believes the mining industry will move away from tailings ponds towards dry tailings in the future.

CREDIT: METSO/SHUTTERSTOCK

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management concept catering to these needs. It offers miners a sustainable way to handle tailings and a new value-creation model through the easy reprocessing of tailings.

Need for a future ready solution There are millions of tons of tailings being discharged today and billions lying in legacy dams. In fact, a lot of operational and closed tailings facilities have residual mineral values, or secondary metals that might not have been of interest in earlier times.

As their orebodies are continuously shrinking, mining companies are looking for viable opportunities to reprocess existing waste. With the advent of novel technologies, mining companies are now figuring out ways to extract valuable metals from tailings.

It is well known by the mining indus-

try that the cost of tailings management and reclamation are also becoming increasingly significant factors for sustainable and economically viable mining and long-term survival.

While water scarcity has been a driver towards considering dry tailings technology in the past, the question now is around responsible use of resources.

“At Metso, we are challenging the conventional way of thinking, while changing the industry view around tailings management in mining. Our emphasis is to include reprocessing of tailings as part of the overall solution,” says Rodrigo Gouveia, vice-president, Tailings Management Systems at Metso.

In practice, it is about making the right choice. Mining companies do not just want the most technically suitable equipment to dewater tailings, they want a future ready solution that is able www.canadianminingjournal.com

While water scarcity has been a driver towards considering dry tailings technology in the past, the question now is around responsible use of resources. to transform legacy practices and takes the end-of-mine strategy to a new level.

Maximizing value from waste With progressive technology and a more environment friendly vision, mining companies have been exploring effective waste management methods to handle mine tailings. Driven by both stored mineral value and reclamation, reprocessing offers an interesting proposition for long-term tailings management.

“In some gold, copper, iron and coal mines, it’s impressive how rich those tailings are,” Gouveia says. “We have conducted studies recently that tell us that in some cases reprocessing one unit of tailings to collect the valuable material can be up to three times more cost-effective than processing virgin material.”

Metso believes that this in a way helps mining companies to reduce possible water losses as well as clean up the existing tailings dams or eliminate them completely, while providing an opportunity to convert mine waste to value.

“Reprocessing is not only a means to sustainability, it’s a huge business opportunity at the same time,” Gouveia says.

With reprocessing, the mining industry can set the agenda to transform tailings ponds from a liability into an asset.

APRIL 2020

Metso offers complete solution for reprocessing of tailings dams through its expertise in comminution and beneficiation solutions. A standard method of reprocessing involves dragging tailings from an existing dam back to the concentrator and using required mineral processing solutions to liberate the valuable metals. The discarded tailings are then dewatered and dry stacked, and the water recycled within the plant or properly disposed back to nature.

Gouveia adds: “Sustainable and productive mining solutions like reprocessing helps in creating a shared value for mining companies, local communities and the entire ecosystem.”

Metso firmly believes that within a few years, dry tailings will be the new standard in the mining industry. And a disruptive practice like reprocessing can virtually eliminate the need for tailings ponds in the coming years, as well as lowering the risk of dam failures and groundwater contamination.

efficiency as well as on the ecology.

Designing and commissioning a future-proof tailings management system requires a totally new mindset.

“As futuristic organizations, we should embrace competitive and viable solutions that not only enhance productivity but create a positive difference to the environment and natural resources,” Gouveia says.

Treating tailings ponds as a potential source for converting “waste to value” would surely help in changing the way the mining industry has been perceived all these years. “It is time to replace the old and negative risk-avoidance position with a new value creation model,” Gouveia says.

With reprocessing technology, Metso commits to bring a step change in managing large volume of tailings, while ensuring efficient, sustainable and economical operations.

CMJ

Making the right choice A conventional view is still dominating the discussion around smarter and efficient management of mine tailings. The way tailings are handled can have a longterm impact on the mines’ economic

Top left: Metso’s dewatering technology, including its VPX filter, which can recover up to 90% of water from tailings. CREDIT: METSO Top and bottom right: Tailings images, including dry-stacking of coal tailings at bottom right.

Niclas Hällevall is vice-president, Processing Systems, at Metso.

CREDIT: METSO/SHUTTERSTOCK

CANADIAN MINING JOURNAL |

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