CIM Magazine August 2009 by CIM-ICM Publications

CONTENTS CIM MAGAZINE | AUGUST 2009 | AOÛT 2009

NEWS 9

Celebrating excellence in mine safety Competition simulates real-life mine emergencies to encourage team building and problem solving by M. Eisner

Industry surveys report increased inequality in Canadian mining The recession affects

individual mining and exploration companies in different ways by P. Caulfield A climate that fosters innovation Presidentelect Chris Twigge-Molecey lays out his broad vision for CIM by M. Kerawala

Un climat qui encourage l’innovation Le prési-

dent-élu Chris Twigge-Molecey explique sa vision globale pour l’ICM Mining above and beyond The mining and space sectors gather for their sixth annual symposium by M. Paduada

Retombées de l’industrie minière : beaucoup plus que des redevances Une lettre d’opinion par l’ancien président du conseil AMQ par Y. Harvey

Benefits of the mining industry An opinion letter by former president of the QMA

Students master mine rescues Mining engineering students get hands-on safety training by J. Drake

26 UPFRONT 20

Agility through simplicity Sometimes the most adaptable solutions are often the simplest ones by B. Sundararajan

The making of good agreements The Wahgoshig First Nation helps Apollo Gold understand the power of Aboriginal engagement by M. Eisner

Who you gonna call? The importance of differentiating between process control, instrumentation and control systems expertise by J. Bouchard and M. Émond

Teaching the business of the mineral resources industry Queen’s University equips future mining industry professionals with sound financial knowledge by J. Martin

A conversation with Canada’s CFO of the Year Agnico-Eagle’s David Garofalo shares his thoughts on a range of topics by M. Paduada

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COLUMNS 52 53 54 55 56 58 59 60 61 62 82

THE POWER OF PEOPLE

CIM NEWS 64

LA FORCE DES GENS 31

Can it be done? Can it be done better? Consultants and

specialists provide the expertise needed to extract the most from human and natural resources by R. Bergen Building leadership from the inside out Diavik blends cutting-edge management education with time-honoured traditional approaches by M. Eisner

Tirer le meilleur des ressources humaines et des ressources minières Les consultants et les spécialistes ont l’expertise

nécessaire pour le faire 40

Bâtir le leadership de l’intérieur Diavik jumèle une gestion de pointe à des approches traditionnelles consacrées par l’usage

FEATURED MINES MINES EN VEDETTE 42

Going for gold Agnico-Eagle’s Kittilä gold mine in Finland is drawing admiring attention from all quarters by M. Paduada

The Midas touch Agnico-Eagle’s LaRonde mine extension by P. Diekmeyer

La mine Kittilä d’Agnico-Eagle Une

Supply Side by J. Baird Eye on Business by M. Bourassa with C. Todd MAC Economic Commentary by P. Stothart First Nations by J.-C. Reyes Innovation by L. Mottola Standards by D. McCombe and J. Postle Student Life by A. Giles and M.-A. Simard HR Outlook by S. Polowin Engineering Exchange by M. Eisner Mining Lore by R. Bergen Voices by K. Lendsay

Sleuthing, cruising and teeing off CIM’s Northern Gateway Branch uses a range of activities to rally support by R. Slack Des élans de bon temps La Section Harricana de l’ICM organise son tournoi de golf annuel par J.-F. Lagueux A swinging good time CIM’s Harricana Branch holds its annual golf tournament Exploring the scene CIM’s Red Lake Branch reviews latest industry developments by C. Storey From the ground up The winner of the Order of Sancta Barbara is reshaping the public’s perception of mining by R. Pillo

Something to sink your teeth into CIM reveals its new lineup for the 2009-2010 Distinguished Lecturer season by R. Pillo United we stand CIM’s new One Membership initiative promises streamlining, solidarity and synergy by M. Kerawala L’union fait la force Le nouveau membership à guichet unique de l’ICM

HISTORY 73 76

Butte, Montana (Part 4) by R.J. Cathro The gold rush in Tierra del Fuego by F. Habashi

TECHNICAL SECTION nouvelle mine d’or en Finlande attire beaucoup d’attention 51

L’expansion de la mine LaRonde d’Agnico-Eagle

This month’s contents

IN EVERY ISSUE 6 8 63 72 81

Editor’s Letter President’s Notes / Mot du président Welcoming new members Calendar Professional Directory

August 2009 | 5

editor’s letter The ties that bind pon discovering that I originally hailed from “the Rock,” a colleague recently recounted a saying that “the only people homesick in Heaven are the Newfoundlanders.” The special kinship that we Newfies feel is undeniable; it is also quite indescribable. How does one go about explaining the force behind a connection to a place renowned for its isolation, cantankerous weather and, until recently, “have-not” status? I bring this up because a similarly strong and equally unshakable bond exists among those who work in the mining and minerals industry. This familiar feeling of kinship grasped me in its embrace almost from the get-go when I joined CIM Magazine. Even though the people and the tasks they perform in this industry are as vast and diverse as the territory they mine, the prevailing feeling of affinity and solidarity is indisputable. Perhaps this shared kinship stems from a common reliance not only on the fortunes of nature but also upon one another. Mining is definitely a team sport and, like any team, there are good seasons and bad, the players sometimes change and we do have our differences from time to time, but in the end we stand tall and proud. This “Power of People” issue looks at some of the stories behind the incredible individuals who propel this industry. The Upfront section features an account of the cooperative efforts between the Wahgoshig First Nation and Apollo Gold in the development of mutually beneficial and sustainable impact benefit agreements at the Black Fox mine in northern Ontario. This inspiring case study illustrates how two groups with little initial understanding of each other collaborated to create the type of win-win scenario that can make our sector stronger. In our feature section, we examine the human resources contribution made by the numerous contractors, consultants and suppliers and their efforts to align ideologies, skills and products to the shifting requirements of an often volatile industry. Our special focus on Agnico-Eagle is especially timely, as we discover that the “people factor” is definitely an important ingredient for this flourishing company’s recipe for success. It includes profiles of their newly opened Kittilä mine in Finland and the LaRonde extension in the Abitibi region of northern Quebec, as well as an interview with David Garofalo, who was recently named Canada’s CFO of the Year. Of course, an important component of CIM Magazine’s evolution comes from the feedback we get from our readers. So please try to take a few moments to weigh in on some of the issues we address. Also, let us know what topics you would like to see covered in future editions by dropping us an email at editor@cim.org.

Regards,

Angela Gordon Editor-in-chief

Editor-in-chief Angela Gordon editor@cim.org Section Editors News, Upfront and Features: Angela Gordon agordon@cim.org Columns and CIM News: Joan Tomiuk jtomiuk@cim.org Histories and Technical Section: Minaz Kerawala mkerawala@cim.org Technical Editor Joan Tomiuk Publisher CIM Contributors Jon Baird, Ryan Bergen, Louise BlaisLeroux, Jocelyn Bouchard, Michael Bourassa, Lorraine Brown, R.J. Cathro, Peter Caulfield, Peter Diekmeyer, Jeff Drake, Marlene Eisner, Martin Émond, Alex Giles, Fathi Habashi, Yves Harvey, Jean-François Lagueux, Kelly Lendsay, Jim Martin, Deborah McCombe, Laura Mottola, Mike Paduada, Robbie Pillo, Sheldon Polowin, John Postle, Juan Carlos Reyes, Marc-André Simard, Roy Slack, Carmen Storey, Paul Stothart, Binod Sundararajan, Charles Todd Published 8 times a year by CIM 855 - 3400 de Maisonneuve Blvd. West Montreal, QC, H3Z 3B8 Tel.: 514.939.2710; Fax: 514.939.2714 www.cim.org; Email: magazine@cim.org Subscriptions Included in CIM membership ($150.00); Non-members (Canada), $168.00/yr (GST included; Quebec residents add $12.60 PST; NB, NF and NS residents add $20.80 HST); U.S. and other countries, US$180.00/yr; Single copies, $25.00. Advertising Sales Dovetail Communications Inc. 30 East Beaver Creek Rd., Ste. 202 Richmond Hill, Ontario L4B 1J2 Tel.: 905.886.6640; Fax: 905.886.6615 www.dvtail.com National Account Executives 905.886.6641 Joe Crofts jcrofts@dvtail.com ext. 310 Janet Jeffery jjeffery@dvtail.com ext. 329

This month’s cover Dumas Contracting shaft miners at Agnico-Eagle’s Goldex project in Val-d’Or, Quebec. Photo by Mike Dupont Layout and design by Clò Communications. Copyright©2009. All rights reserved. ISSN 1718-4177. Publications Mail No. 09786. Postage paid at CPA Saint-Laurent, QC. Dépôt légal: Bibliothèque nationale du Québec. The Institute, as a body, is not responsible for statements made or opinions advanced either in articles or in any discussion appearing in its publications.

Printed in Canada

6 | CIM Magazine | Vol. 4, No. 5

president’s notes The future is in your hands Over the past few years, we have heard and read a great deal about the anticipated shortage of people entering the Canadian mining industry. This deficit has been widely attributed to both the commodities boom and our aging demographics. While the current recession might have temporarily dampened the demand for human resources in many sectors, the demographics of our industry (and CIM) have not changed. We still face a great many staffing challenges in the next few years as the baby boomers retire. It also bears remembering that when the widely predicted economic upswing occurs, we will once again be in competition with other industries fishing from the ever-shrinking labour pool. The attraction, retention and development of our workforce have always been important issues faced by mining companies wishing to remain sustainable. Many companies have developed specific programs to address this situation, including engineer-in-training programs, leadership development and specific trades and apprenticeship education. This issue of CIM Magazine highlights some of these best practices currently being employed throughout the industry. From Diavik Diamond Mine’s Aboriginal Leadership Development Program to MiHR’s labour market and information forecasting, you’ll read about how organizations are investing in our most valuable assets — our people.

What can we do as CIM members to help with the human resources situation? As some of us get to the latter half of our careers, it is incumbent on us to share our experiences and mentor the next generation of young professionals as they begin their professional journeys. The mining industry is going to lose a lot of know-how in the next few years and it’s up to the more “seasoned” members to pass that expertise on. With its extensive and active networks, CIM can provide the channels and the context to do this, through its conferences, meetings and CIM Magazine (now available in an online version). I encourage every CIM member to invite a younger colleague to the next CIM meeting you attend. Better yet, invite them to join CIM if they are not already a member. The very future of our industry depends on it!

Michael J. Allan CIM President

L’avenir est entre vos mains Au cours des quelques dernières années nous avons beaucoup lu et entendu concernant le manque anticipé de personnel pour l’industrie minière canadienne. Ce déficit a été largement attribué à la fois à la grande demande pour des produits de base et au vieillissement de la population. Cependant, bien que la récession actuelle puisse avoir diminué temporairement la demande pour des ressources humaines dans de nombreux secteurs, l’évolution des effectifs dans notre industrie (et à l’ICM) n’a pas changé. Les prochaines années nous amèneront encore le défi de trouver du personnel alors que les baby-boomers prennent leur retraite. Il est aussi bon de se rappeler que lorsqu’arrivera la phase économique ascendante prédite, nous serons de nouveau en compétition avec les autres industries qui s’alimenteront dans le même bassin que nous, un bassin qui diminue de jour en jour. L’attraction, la rétention et le développement de notre main-d’oeuvre ont toujours constitué des enjeux importants confrontant les compagnies minières qui veulent demeurer durables. De nombreuses compagnies ont développé des programmes spécifiques pour traiter de cette situation dont des programmes de formation d’ingénieurs et de développement du leadership en plus de formation dans des métiers spécifiques et d’apprentissages. La présente édition du CIM Magazine met l’accent sur quelques-unes des meilleures pratiques utilisées dans l’industrie. Du Programme de 8 | CIM Magazine | Vol. 4, No. 5

formation de dirigeants autochtones des mines d’or Diavik au système de prévisions des besoins du marché du travail du RHiM, vous pourrez lire comment les organismes investissent dans notre actif le plus important — nos gens. Que pouvons-nous faire en tant que membres de l’ICM pour aider à résoudre cette question des ressources humaines? À mesure que certains d’entre nous entrons dans la seconde moitié de notre carrière, nous avons l’obligation de partager nos expériences et de servir de mentors à la prochaine génération de jeunes professionnels alors qu’ils entament leur cheminement de carrière. L’industrie minière perdra beaucoup de savoir-faire dans les prochaines années et il est le devoir des membres « plus expérimentés » de transmettre cette expertise. Grâce à ses réseaux extensifs et actifs, l’ICM peut fournir les moyens et le contexte pour ce faire : par ses congrès, ses rencontres et le CIM Magazine (maintenant disponible en ligne). Je vous encourage, vous et chaque membre de l’ICM, à inviter un jeune collègue à la prochaine rencontre à laquelle vous assisterez. Mieux encore, invitez-le à se joindre à l’ICM s’il n’est pas déjà membre. L’avenir même de notre industrie en dépend!

Michael J. Allan Président de l’ICM

news Celebrating excellence in mine safety Competition simulates real-life mine emergencies to encourage team building and problem solving By Marlene Eisner Photo by of Mark Teasdale

through a simulated mine environment similar to what they would face in an actual mine rescue situation. In its 54th year, the annual competition, which takes place at the BC Museum of Mining and is hosted by the Ministry of Energy, Mines and Petroleum Resources, is designed to simulate real-life situations and test skills in first aid, extrication, fire fighting, rope work and general mine rescue. Established in 1917 to reduce fatality rates in BC’s mines, the event is also an exercise in team building, since participants may one day be involved in mutual aid collaboration with workers in other sectors in the industry. For example, Highland Valley Copper, winner of last year’s surface mine rescue event, recently assisted in the rescue of a man buried for 14 hours at Pavilion in Cache Creek. At the end of the day, 10 trophies were awarded to the best in three categories, chosen from six surface teams, four underground teams and six threeperson miners’ first aid teams. Later in the evening, mining industry representatives from across BC attended the 47th Annual Mine Safety Awards ceremony, which honoured 14 mines and quarries that had accumulated 15,000 or more worker or contractor hours and had no fatalities in the calendar year of 2008.

Mine rescue participants

This year’s Provincial Mine Rescue and First Aid Competition, held on June 6 at Britannia Beach, British Columbia, brought together teams from across the province to compete in a day-long series of challenges geared towards rescue and safety in BC mines. The 2009 competition, which was open to the public, consisted of an underground mine rescue, a surface mine rescue and a three-person first aid scenario that was scored based on standard St. John Ambulance training. Mining experts evaluated each challenge as teams worked

“Being a part of the Mine Rescue Competition is in line with our commitment to educate, inspire and entertain,” explained BC Museum of Mining executive director Kirstin Clausen. “We commend the ministry staff for offering this program, not only as a spectator experience to the public, but for the potentially life-saving experience the competition brings to anyone involved with emergency response.” CIM www.bcmuseumofmining.org

This year’s winners of the Provincial Mine Rescue and First Aid Competition were: Three-person miners’ first aid competition • Highland Valley Copper, Teck: three-person miners’ first aid • Highland Valley Copper, Teck: Kathy Lofstrom Memorial (best coach for three-person first aid) Surface mine rescue • Highland Valley Copper, Teck: Maurice Boisse Memorial (best bench for surface team) • Greenhills Operations, Teck Coal: HVC highest non-aggregate points • Greenhills Operations, Teck Coal: Overall surface mine rescue trophy Underground mine rescue • Quinsam Coal Corporation: USWA MineMill Award (best underground coordinator) • Quinsam Coal Corporation: Sullivan Cup (best first aid by underground team) • Quinsam Coal Corporation: Barry Abbott Memorial (best bench for underground team) • New Afton, Newgold Inc: Keith Bracewell Memorial Award (best obstacle and recovery) • Quinsam Coal Corporation: Overall Underground Mine Rescue Trophy August 2009 | 9

news Industry surveys report increased inequality in Canadian mining Recession affects individual mining and exploration companies in different ways By Peter Caulfield According to the authors of two recent business surveys that included the Canadian mining industry, the sector is down but not out. The reports, by Ernst and Young and PricewaterhouseCoopers (PwC), detail the dramatic fall in prices and market capitalization, the ways in which the industry has been affected and how it is dealing with the downturn. Cash is king, nowadays. Those who have it are more likely to get through the tough times than those who do not. Little of that money is being spent on exploration, however, which is likely to mean tighter supplies and soaring prices when the global economy gets back on its feet. The Canadian mining industry, on the whole, is looking ahead with a mix of cautious optimism and patient acceptance.

PwC: To have and have not (cash) The PwC survey is an annual compilation of the financial trends of the top 40 mining companies in the world. In the most recent survey, which covered the 2008 calendar year, eight of those companies were Canadian. According to the report, the global mining industry has been in a spectacular decline. In 2008, the total net profit of the top 40 was $57 billion, a decrease of 28 per cent from 2007. The year 2008 was a bad one for investors, too. Only three of the 40 companies had a positive oneyear total shareholder return (TSR), and the lowest four showed a decline of 75 percent or more. In 2007, 14 of the top 40 achieved a TSR of more than 100 per cent, and four 10 | CIM Magazine | Vol. 4, No. 5

companies reported a TSR of more than 400 percent. The rapid fall in market capitalization and increased debt levels for some of the top 40 has created two distinct groups of “haves” and “have-nots,” said Paul Murphy, leader of PwC’s Canadian mining practice. At the moment, cash is the most valuable asset for miners and explorers. For companies with cash, opportunities abound as asset values fall.

After the industry has caught its breath, prices will start to go back up again.” — B. Bosshard

One of the most striking findings of the survey was the magnitude and swiftness of the correction, Murphy told CIM Magazine. “But since last fall liquidity has returned to the marketplace,” he said. Murphy’s colleague Bob Bosshard, who is a mining partner in PwC’s Toronto office, is also confident about the future. “The fundamentals for base metals haven’t changed,” he said. “China and India are still hungry for them. We’re going through a temporary hiccup in pricing. After the industry has caught its breath, prices will start to go back up again.”

Ernst and Young on opportunists, innovators and survivors Ernst and Young surveyed 337 companies around the world to examine implications of the financial crisis on different industries, including the Canadian mining sector. According to the report, mining in this country has become divided into three camps: opportunists, innovators and survivors. Most of the opportunists are majors. Armed with strong balance sheets, they’re looking for acquisitions. But, because many buyers are looking ahead to present and future valuations, while sellers are looking to the past, many potential deals have been left unmade. “The opportunists and the survivors aren’t connecting,” said Ernst and Young Canadian mining and metals practice leader, Tom Whelan. “The survivors are holding on, hoping they can survive, and the opportunists aren’t willing to shoulder additional risk at the prices survivors want for their assets.” Most of the innovators are midtier players, many of which are highcost producers seeking creative survival strategies, including being acquired by better-capitalized companies. Not surprisingly, the survivors are dominated by juniors that have made conserving cash their number one priority. Many of them have suspended exploration altogether, or as much as they dare without losing mineral rights. “It’s striking how quickly expenditures on exploration have turned off, even on good projects,” Whelan said. He went on to say that there is a general unwillingness in the

news industry to take on additional risk. Although that makes sense in the short run, reluctance to invest in exploration today will inevitably lead to a scramble for scarce resources when the economy starts to recover. “Previous recessions have shown that metal supply exceeded demand for only a short time,” Whelan said. Looking ahead, he commented: “We’re living in uncertain times. Things are looking up, but nobody knows yet when the recovery will be on a solid footing. The turning point might be the massive fiscal stimulus packages underway, or the vast infrastructure programs that are planned.”

And now, a word from the mining industry Like the authors of the reports, four representatives of the Canadian mining and exploration industry say the worst of the downturn is behind us. “There have been a lot of layoffs in the Ontario mining sector and many mines have been placed on care and maintenance,” observed Chris Hodgson, president of the Ontario Mining Association. “On the other hand, gold is still in good shape and the operating mines have good cash flow. And the last three months have seen a noticeable improvement in most commodity prices. So we’re optimistic in Ontario.” Pierre Gratton, president and CEO of the Mining Association of British Columbia, summed up the mood in his province saying: “There are about 20 producing mines in British Columbia and that number has remained stable through the downturn. We expected the downturn to be worse on the mining side than it actually turned out. The prices of some minerals and metals have stayed pretty healthy.” Reporting the state of affairs on the exploration side, Gavin Dirom, president and CEO of the Association for Mineral Exploration BC said: “Exploration budgets are down from last year, but they’re

starting to creep back up again. In 2009, we expect a total of about $300 million will be spent on exploration by juniors and majors combined. If we can hit $300 million every year, we’ll find the deposits we need to keep mining flourishing in BC. We’re cautiously optimistic.”

Doug Horswill, senior vice-president sustainability and external affairs, Teck Resources Limited, reported: “Last year, we made a substantial addition to our resource base with the purchase of Fording Canadian Coal Trust’s assets, which put Teck in a strong position to grow.” CIM

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August 2009 | 11

news A climate that fosters innovation President-elect Chris Twigge-Molecey lays out his broad vision for CIM By Minaz Kerawala In his day job, CIM’s president-elect (2010-2011), Chris Twigge-Molecey is the chief knowledge officer and board member of Hatch Inc. globally. As the title suggests, this is a role that requires a grasp not only of the latest technologies, but also of the way knowledge flows through the company, the industry and the economy. Given the broad scope of his leadership at Hatch, it is not surprising that TwiggeMolecey’s vision for CIM is deep and expansive. A CIM member since the early 1980s, Twigge-Molecey came to Canada from England in the 1960s as a graduate student. A veteran of many CIM Chris Twigge-Molecey conferences and committees, this country. I believe I can conTwigge-Molecey said he has tribute to its growth in several mean“worked with and met many great individuals and developed strong ingful ways,” he said. “As part of our personal friendships.” He added, evolving strategic plan, we are looking to grow substantially and sus“Whether it is to organize a confertainably and develop a wide range of ence, rustle up a paper, put together international linkages.” a task force or even just to find some Being on the more sagacious side of information, the network I have 60, the president-elect is conscious of built through CIM has been hugely the need for attracting youth to the useful. It has contributed greatly to industry, an area he is keen to focus my effectiveness.” Twigge-Molecey on. Coming from a strong technnical strongly encourages his colleagues background himself, he will also be at Hatch and elsewhere to join the “looking to enhance our technical CIM technical societies that are relimpact through alliances with leadevant to their work. Speaking with ing-edge scientific organizations such his Hatch hat on, he said: “CIM furas the Canadian Space Agency and the ther offers us a great avenue to meet Canada Mining Innovation Council.” our clients in a social context.” On these not inconsiderable tasks, His conviction in CIM’s ethos of Twigge-Molecey will bring to bear knowledge sharing and relationship building led Twigge-Molecey to the full weight of his diverse skills, international experience and what he accept the responsibility of serving calls his “passion for innovation and as its president. “CIM is a vital mentoring.” As CIM president, he organization in an industry that is a would like to further the creation of key part of the life and economy of 12 | CIM Magazine | Vol. 4, No. 5

tools and resources that help members grow professionally. He is also interested in broadening CIM’s geographical base and sphere of influence, “so that we can pull in professionals on a global basis.” He would like to leave in his wake a broadened and highly relevant range of services. Above all, he would like to contribute to the creation of “a climate within the country that fosters innovation.” Conscious of the fact that his vision is ambitious, TwiggeMolecey is thankful for the platform provided by the work of his predecessors, “including Jim Gowans, Jim Popowich and the many giants whose shoulders they stood on.” He is aware also that current president Mike Allan is finalizing and launching into the first phases of CIM’s new strategic plan, and is watching carefully to position himself well for when Allan passes on the baton to him. Surveying emerging trends around the industry Twigge-Molecey stated optimistically: “Wherever there’s change, there’s opportunity. The current economic crisis creates opportunities for us to support our members, primarily in upskilling, job searching and perhaps in the formation of new enterprises by introducing the more scientific individuals to the more entrepreneurial ones.” From attracting youth and international talent to helping members tide over the crisis and grow professionally, it seems that Chris Twigge-Molecey will leave few stones unturned as CIM’s next president. He will need this broad-spectrum approach given that his “vision for CIM is for it to be the intellectual engine of our sector.” CIM

news Un climat qui encourage l’innovation Le président-élu Chris Twigge-Molecey explique sa vision globale pour l’ICM

Le jour, à son travail, le présidentélu de l’ICM (2010-2011), Chris Twigge-Molecey, est le principal gestionnaire de savoirs et membre du conseil chez Hatch Inc. Comme le suggère son titre, il s’agit d’un rôle qui demande de saisir non seulement les plus récentes technologies mais aussi la manière dont les connaissances circulent dans la compagnie, l’industrie et l’économie. En raison de la grande portée de son leadership chez Hatch, il n’est pas surprenant que la vision de M. Twigge-Molecey pour l’ICM soit profonde et expansive. Membre de l’ICM depuis le début des années 1980, M. Twigge-Molecey est venu au Canada depuis l’Angleterre dans les années 1960 en tant qu’étudiant diplômé. Un vétéran de nombreux congrès et comités de l’ICM, il dit qu’il a « rencontré et travaillé avec plusieurs grands individus et a développé de très grandes amitiés personnelles. » Il ajoute : « Qu’il s’agisse d’organiser un congrès, écrire un article, rassembler un groupe de travail ou simplement trouver de l’information, le réseau que j’ai établi grâce à l’ICM m’a été d’une grande utilité. Il a grandement contribué à mon efficacité. » M. Twigge-Molecey encourage fortement ses collègues chez Hatch et ailleurs à se joindre aux sociétés techniques de l’ICM qui sont pertinentes à leur travail. Mettant son chapeau Hatch, il dit : « L’ICM nous offre un grand recours pour rencontrer nos clients dans un contexte social. » Sa conviction en l’ethos de l’ICM de partager des connaissances et d’édifier des relations a poussé M. Twigge-Molecey à accepter la responsabilité de servir en tant que président. « L’ICM est une organisation vitale dans une industrie qui joue un rôle clé dans la vie et l’économie de ce pays. Je crois que je

peux contribuer à sa croissance de plusieurs manières significatives », dit-il. « Dans le cadre de l’évolution de notre cadre stratégique, nous cherchons à croître de façon significative et durable, tout en développant diverses liens internationaux. » Du côté sage de la soixantaine, le président-élu est conscient du besoin d’attirer des jeunes dans l’industrie, un domaine qu’il entend cibler. Étant luimême un maître technicien, il « cherchera à rehausser notre impact technologique par des alliances avec des organismes à la fine pointe de la science, tels que l’Agence spatiale canadienne et le Conseil canadien de l’innovation minière. » À ces tâches non négligeables, M. Twigge-Molecey apportera le plein poids de ses diverses habiletés, de son expérience internationale et de ce qu’il qualifie de sa « passion pour l’innovation et le mentorat. » En tant que président de l’ICM, il aimerait faire progresser la création d’outils et de ressources qui aident les membres à croître dans leur profession. Il est aussi intéressé à élargir la base géographique et la sphère d'influence de l’ICM « afin que nous puissions attirer des professionnels sur une base mondiale. » Il aimerait laisser un legs de services élargis et de qualité supérieure. Par-dessus tout, il aimerait contribuer à la création au pays d’un « climat qui encourage l’innovation. »

Conscient du fait que sa vision est ambitieuse, M. Twigge-Molecey est reconnaissant de la plate-forme que lui ont laissé ses prédécesseurs, « incluant Jim Gowans, Jim Popowich et les épaules des nombreux géants sur lesquels ils ont pu se tenir. » Il sait bien aussi que le président actuel Mike Allan inaugure les premières phases du nouveau plan stratégique de l’ICM et il surveille attentivement afin d’être bien positionné lorsqu’on lui passera le bâton. Analysant les tendances émergeantes dans l’industrie, M. TwiggeMolecey affirme de manière optimiste : « Là où il y a du changement, il y a aussi des opportunités. La présente crise économique nous crée des occasions de soutenir nos membres, surtout dans la recherche d’emplois, le perfectionnement et possiblement dans la formation de nouvelles entreprises en présentant des individus à pensée scientifique à d’autres plus portés vers l’entrepreneuriat. » Entre attirer des jeunes et des talents internationaux et aider les membres à passer à travers la crise et à croître dans leur profession, il semble que M. Twigge-Molecey ne négligera aucun détail en tant que prochain président de l’ICM. Il aura besoin de cette approche à grande portée puisque sa « vision pour l’ICM est d’être le moteur intellectuel de notre secteur. » ICM

Moving on up Mark Fields is the new president and CEO of Geodex Minerals Ltd. He has played key roles in the sale of La Teko Resources Ltd. to Kinross Gold Corporation, and the acquisition and development of the Diavik Diamond Mine for the Rio Tinto Group. As executive vice-president of Pine Valley Mining Corp., Fields provided leadership for the development of the Willow Creek coal mine up to the commercial production stage. August 2009 | 13

news Mining above and beyond Mining and space sectors gather for sixth annual symposium

Rovers on demonstration at PTMSS

Professionals and researchers from across the aerospace and mining sectors gathered in Toronto recently for the sixth annual Planetary and Terrestrial Mining Sciences Symposium (PTMSS). The purpose of the conference is to promote closer relationships between space-related and mining-related sectors through networking, knowledge sharing and collaboration. Based on the lineup of presentations and the delegates’ reactions, it seems that the two multi-billion-dollar industries, both behemoth institutions unto themselves, are forging the connections that will propel the future of joint technology developments. The opening remarks of conference chair Dale Boucher echoed the remarkable similarities between the two sectors, already familiar to many of the returning conference delegates. Both sectors drive immense projects involving large capital costs, with long-term time horizons, requiring integrated interdisciplinary activities. “Those similarities are really the 14 | CIM Magazine | Vol. 4, No. 5

Photo by Richard Fabic, http://fabic.ca

By Mike Paduada

purpose behind this conference,” asserted Boucher, who is the director of innovation at the Sudbury-based Northern Centre for Advanced Technology (NORCAT). There are yet more similarities in the actual research, activities and objectives when considering space exploration’s push for in situ resource utilization (ISRU). “ISRU involves a complete suite of activities, which are very similar to the mining cycle,” said Boucher. Indeed, as was reiterated in several of the conference sessions, ISRU involves such familiar mining tasks as drilling, exploration, prospecting, excavation, ground control, processing, surface preparation, logistics, materials transport and communication, to name a few. Chris Twigge-Molecey, CIM president-elect, addressed the symposium about the opportunity for mutually beneficial exchange and the prospect for developing new technologies that can serve both sectors. “If you’re going to mine and process in space, our CIM members bring to the table global

leadership in mining, exploration, metallurgical processing and material sciences,” said Twigge-Molecey. But technology transfer is only one side of the exchange. Frankly, if the mining industry is going to meet its human resource demand in the coming decades, it would greatly benefit from seizing the awe and fascination of bright, young minds in the way space always has. As the chief knowledge officer at Hatch, Chris TwiggeMolecey knows very well the strategic value of making that connection. “This is capturing Canadians’ attention,” he said. “We need public attention to attract young people to our business and our industry. We also need public support to get the necessary R&D. So, the mining and space industries have at least two strong strategic reasons to work together.” If the broad set of topics covered in the conference presentations is any indication, the technologies that could be developed from collaboration will offer clear benefits to both sectors. Through collaboration, presenters foresee advances in the science and technologies of excavation, mining, intelligent real-time drilling measurement, remote geology, stressed communication and autonomous operation. Conference presenters and delegates alike came from across the board, including NASA, the Canadian Space Agency, NORCAT, Pacific International Space Center for Exploration Systems, Electric Vehicle Controllers, Ontario Drive and Gear, Honeybee Robotics, Xiphos Technologies, Odyssey Moon, Watts, Griffis & McOuat, TNO Science & Industry, the University of Toronto, Laurentian University, McGill University, Carnegie Mellon University and Case Western Reserve University. CIM www.ptmss.com

news Retombées de l’industrie minière : beaucoup plus que des redevances Lettre d’opinion par Yves Harvey, l’ancien président du conseil AMQ Le rapport du Vérificateur général du Québec questionne certaines activités du ministère des Ressources naturelles et de la Faune du Québec et, par ricochet, celles d’entreprises minières. À la veille de tenir son Assemblée générale annuelle en juin, l’Association minière du Québec (AMQ), dont les sociétés membres représentent la très grande part de la production québécoise de métaux et de minéraux industriels, souhaite réagir à certains éléments de ce rapport et surtout, aux propos de politiciens et de groupes de pression largement repris par les médias qui laissent croire, à tort, que les retombées de l’industrie minière seraient à peu près inexistantes pour le Québec et ses régions. De tels propos démontrent une très grande méconnaissance de l’industrie minière.

Le rapport du Vérificateur Les recommandations du Vérificateur portent essentiellement sur cinq aspects: (1) le suivi et l’inspection des exigences relatives aux plans de restauration des sites miniers; (2) l’acquisition et la diffusion de l’information et des connaissances sur le secteur minier; (3) l’élaboration d’une stratégie minérale qui respecte les principes du développement durable; (4) les garanties financières pour la restauration des sites; (5) la question des droits miniers. Les carences identifiées pour le suivi et l’inspection des exigences (1), ainsi que pour l’acquisition et la diffusion de l’information sur le secteur minier (2) sont les conséquences d’une politique de compressions graduelles des budgets et du personnel qu’on peut observer depuis plus de 12 ans au ministère des Ressources naturelles et de la Faune limitant ainsi la réalisation de son mandat de premier gestionnaire des ressources naturelles de l’État. L’AMQ

est d’avis qu’il faudrait revoir à la hausse les budgets et les effectifs consacrés à ce ministère. À propos d’une stratégie minérale pour le Québec (3), l’Association a déjà présenté au gouvernement un certain nombre de mesures pour le soutien à long terme du développement de l’industrie minière au Québec, la protection de l’environnement et l’assurance d’une intégration harmonieuse des activités minières dans le milieu. Sur les garanties financières pour assurer le niveau de la couverture des coûts de restauration (4), l’AMQ a déjà fait savoir aux autorités qu’elle est favorable à une augmentation à 100 % du niveau de cette couverture, à l’élargissement de la portée des garanties, à la révision de la période qui devrait permettre de constituer une telle garantie, ainsi qu’à l’examen avec grande vigilance de la situation financière de l’acquéreur lors d’un transfert de la responsabilité environnementale d’une propriété minière.

La question des redevances : des précisions s’imposent Le rapport du Vérificateur du Québec mentionne que pour la période de 2002 à 2008 (6 ans), 14 sociétés minières ont cumulé une valeur brute de production annuelle de 4,2 milliards dollars sans payer de redevances. À ce sujet, certaines précisions s’imposent. D’abord, la structure de redevances actuelles légiférée par le gouvernement est reliée à la notion de profit, et non à celle de la valeur de production que retient pourtant le rapport. Une maladresse de cette nature est d’importance puisqu’elle peut suggérer au lecteur, à tort, que l’industrie minière n’engendre que peu de retombées dans le milieu où elle exerce ses activités. De plus, certains propos contenus dans le rapport du Vérificateur portent

à confusion. Celui-ci laisse entendre que 14 entreprises pendant 6 ans n’ont pas payé de redevances; en réalité, ce sont 14 entreprises qui n’ont pas eu à payer de redevances, à un moment ou à un autre, pendant cette période. Ce qui est très différent et qui trouve aussi son explication. Ainsi une entreprise doit investir des sommes considérables pour développer un gisement non renouvelable. Cette capitalisation élevée des entreprises (ex.700 M$ pour la mine Raglan d’Xstrata, 1 milliard $ pour la Corporation minière Osisko), ainsi que les coûts majeurs d’opérations, doivent être amortis sur la durée de vie de la mine, ce qui a un impact sur les revenus, les déductions annuelles auxquelles celle-ci a droit, les profits de cette entreprise et, conséquemment, sur les redevances qu’elle doit aussi payer en fonction de ces profits au cours de chacune de ces années. Un exemple pour vulgariser. Dix personnes vivent dans le quartier d’une ville avec un revenu annuel chacun de 40 000 $. Comme ils ont des obligations ayant chacun aussi plusieurs enfants à charge, ceux-ci ont droit à des déductions fiscales. Ainsi, sur une période de 10 ans, même s’ils ont cumulé ensemble un revenu de 4 M$, ceux-ci pourraient ne pas payer d’impôt en raison de déductions annuelles auxquelles ils ont droit. Cette analogie veut simplement mieux faire comprendre qu’il se peut très bien qu’une entreprise, à un moment ou à un autre pendant une période donnée, ne paie pas de redevances. Il faut voir la question des impôts et des redevances pour une entreprise minière sur un horizon de plusieurs années. Et surtout, il faut bien savoir que les retombées de l’industrie minière, c’est beaucoup plus que des redevances. August 2009 | 15

news Beaucoup plus que des redevances Le Vérificateur lui-même aborde, il est vrai, à un seul endroit dans son rapport et sans les chiffrer, la question des retombées positives de l’industrie pour la société québécoise (article 2.35) Ces retombées peuvent prendre différentes formes : créations d’emplois, ouverture sur les relations internationales par le commerce, revenus fiscaux, droits et taxes, structuration communautaire, etc. Dans les faits cependant, le rapport se restreint uniquement aux seules redevances. Certains politiciens et groupes de pression ont grandement utilisé l’aspect des redevances pour vilipender les activités de l’industrie minière. Leurs propos, largement repris par les médias, cherchent à laisser croire, à tort, que les retombées de l’industrie minière sont à peu près inexistantes pour le Québec et ses régions. Des miettes pouvait-on lire ou entendre, moins qu’un pourboire de restaurant. Des propos qui démontrent une très grande méconnaissance du secteur minier. L’industrie minière est créatrice d’emplois et de richesses pour le Québec et ses régions. Cette industrie représente plus de 50 000 emplois dans cette province dont 18 000 sont reliés directement à la phase d’extraction, des emplois tous très bien rémunérés. En plus de concrétiser son rôle de moteur de l’économie régionale par sa contribution au marché de l’emploi, le secteur minier génère aussi annuellement d’importantes retombées qu’il est certes utile de rappeler. Ainsi, pour la seule année 2006, la contribution des membres de l’Association minière du Québec aura été de 2 milliards de dollars en achat de biens et de services, dont 66 % ont été investis localement et régionalement; 307 millions ont été consacrés au transport; 68 millions à la qualité de l’environnement; 836 millions en salaires; 278 millions en taxes; 215 millions en impôts; 239 millions en programmes et avantages sociaux; en plus de 18 millions de dollars en différents dons et activités de soutien à des communautés, à des milieux de formation, centres hospitaliers ou activités 16 | CIM Magazine | Vol. 4, No. 5

communautaires. Le secteur minier offre aussi des possibilités considérables aux populations autochtones avec la signature d’accords contribuant à la prospérité économique et au bien-être de ces communautés. Quoiqu’en disent ses détracteurs, l’industrie minière n’est pas du tout gênée, bien au contraire, des retombées de ses activités et de ses interventions en régions. Il est aussi bien connu que la présence de l’industrie minière, en plus de représenter un impact palpable sur la consommation régionale, permet le développement continu d’une expertise de sous-traitance, de transformation, de manufacturiers et de fournisseurs de services spécialisés, en plus de favoriser l’enrichissement des infrastructures, tant municipales que commerciales. L’industrie minière génère également des retombées considérables dans des régions qui ne sont pas traditionnellement associées au secteur minier. À Montréal, Québec, Valleyfield, SorelTracy et ailleurs, on trouve des institutions de recherche et développement, de formation, de services financiers, en plus de grandes entreprises de transformation dans les secteurs du cuivre, du zinc, du fer et du titane. Ainsi, l’industrie minière a des retombées pour l’ensemble des régions du Québec.

Au coeur de notre quotidien Enfin, si on développe des gisements, c’est que l’industrie minière travaille à extraire les métaux et les minéraux dont notre société moderne a besoin, notamment pour l’agriculture, l’habitation, les transports, la musique, les télécommunications, l’industrie environnementale, la construction, l’exploration spatiale, la médecine et aussi pour nos loisirs. Ainsi, à votre prochaine soirée musicale, en écoutant les guitares ou les violons, vous n’imaginerez probablement pas que les cordes de ces instruments sont élaborées à partir d’une gamme de métaux de cuivre, de zinc, de fer et d’acier; pourtant au cœur de notre quotidien, l’industrie minière se retrouve aussi au cœur de l’orchestre! ICM

Benefits of the mining industry An opinion letter by former QMA chairman The report of the Vérificateur général du Québec, the province’s auditor general, questions certain activities of the ministère des Ressources naturelles et de la Faune du Québec (Quebec’s ministry of natural resources) and, thereby, the activities of mining companies. On the eve of its annual general meeting in June, the Quebec Mining Association (QMA), whose member societies represent a majority of Quebec’s metal and industrial mineral producers, would like to respond to certain elements of the report, and especially to the comments of politicians and lobby groups who would have people wrongly believe that the mining industry offers virtually no benefits to Quebec and its regions. Such comments betray a great lack of knowledge of the mining industry. The recommendations of the Vérificateur essentially cover five aspects: (1) the followup and examination of requirements pertaining to mine site rehabilitation plans; (2) the acquisition and diffusion of information on the mining sector; (3) the development of a mineral strategy that respects the principles of sustainable development; (4) financial guarantees for mine site rehabilitation; and (5) the mining rights issue. The deficiencies identified in the examination of requirements and in the acquisition and diffusion of mining sector information are the consequences of a policy of gradual budget and personnel constraints at the ministère des Ressources naturelles et de la Faune that date back more than 12 years. The QMA believes that the budgets and the manpower of this ministry should be augmented. Regarding a mineral strategy for Quebec, the association has already proposed a number of measures to the government to support the long-term

news development of Quebec’s mining industry, the protection of the environment and the harmonious integration of mining activities in the community. On the question of financial guarantees to ensure the full coverage of rehabilitation costs, the QMA has already informed the authorities that it is in favour of a 100 per cent increase in the level of this coverage, a broadening of the scope of the guarantees, a revision of the time period of such a guarantee, and the close scrutiny of the financial condition of the purchaser when the transfer of environmental responsibility for a mining property occurs.

The royalty issue The report of the Vérificateur du Québec mentions that for the six-year period from 2002 to 2008, cumulatively, 14 mining companies amassed a gross annual production of $4.2 billion without paying royalties. In this regard, certain clarifications are in order. First of all, the current royalties’ structure legislated by the government is based on the notion of profit and not on production value, as stated in the report. Such a blunder is significant, as it incorrectly suggests to the reader that the mining industry creates few benefits wherever it operates. Moreover, certain statements in the report are confusing. They suggest that 14 companies paid no royalties over six years. In reality, there were 14 companies that were not required to pay royalties at one time or another during this period, which is very different and entirely explicable. A company must invest a great deal of money to develop a nonrenewable resource. This high capitalization cost ($700 million for Xstrata’s Raglan mine and $1 billion spent by Osisko Mining Corporation) and the high operating costs must be amortized over the life of the mine. This impacts the revenues, the annual deductions permitted, the profits and, consequently, the royalties it must pay on these profits each year. As an illustrative example, consider any 10 people, each with an annual

income of $40,000, living in a given neighbourhood. Because they have dependant children, they are entitled to tax deductions. Thus, over a period of 10 years, even if they have a combined income of $4 million, they may not always pay income tax, given their allowable annual deductions. This analogy can explain how a company, at a given time during a given period, does not pay royalties. For a mining company, the tax and royalty issue must therefore be examined over a period of several years. Above all, it must be understood that the benefits of the mining industry go well beyond royalties. In all honesty, it must be said that at one juncture in the report (Article 2.35), the Auditor General touches upon the benefits of mining for Quebec society. Without quantifying them, the report notes that these benefits can take many forms — job creation, commercial international relationships, fiscal revenues, duties and taxes, community organization, etc. In reality, though, the report is restricted only to royalties. Some politicians and pressure groups have widely used the royalty issue to vilify the activities of the mining industry. Their comments, largely echoed by the media, leave the incorrect impression that the benefits of the mining industry have been practically nil for Quebec and its regions. Sections of the media have described the industry’s royalty contributions as “scraps,” and as being “less than a restaurant tip” — statements that reveal poor knowledge of the mining sector. The mining industry creates jobs and wealth for Quebec and its regions. It represents more than 50,000 jobs in the province, 18,000 of which are very highly paid jobs directly related to the extraction phase. In addition to solidly establishing its role as a driver of the regional economy through job creation, the mining sector also generates significant annual benefits that are worth bearing in mind. In 2006 alone, QMA members invested $2 billion in purchasing goods and services, 66 per cent of which was spent locally and regionally. $307

million was spent on transport; $69 million on environmental quality initiatives; $836 million in salaries; $278 million on levies; $215 million on income taxes; and $239 million on social benefit programs. In addition, $18 million was disbursed through various donations to community activities, training centres, hospitals and community centres. The mining sector also opens up considerable opportunities for Aboriginal Peoples through agreements that contribute to the economic prosperity and the well-being of their communities. Regardless of what its detractors say, the mining industry is not at all embarrassed. It is also well known that in addition to having a tangible impact on regional consumption, the presence of the mining industry fosters the ongoing development of expertise in sub-contracting, processing, manufacturing and specialized services, in addition to encouraging the development of better municipal and commercial infrastructure. The mining industry also has positive impacts on regions not generally associated with mining. In Montreal, Quebec, Valleyfield, Sorel-Tracy and elsewhere, there are research and development establishments, training institutions, financial service organizations and large copper, zinc, iron and titanium processing facilities. The mining industry thus benefits all of Quebec’s regions.

At the heart of our daily activities Finally, if deposits are developed and mined, it is because the mining industry works to extract the metals and minerals that our society needs for agriculture, housing, music, telecommunications, the environmental industry, construction, space exploration, medicine, and leisure. The next time you attend a concert and listen to the guitars or violins, you probably won’t think that the strings of these instruments are made from a gamut of metals such as copper, zinc, iron and steel. At the heart of our daily activities, the mining industry is also at the heart of an orchestra. CIM August 2009 | 17

news Students master mine rescues Mining engineering students get hands-on safety training

There’s a fire in a mine a mile below the earth’s surface, it’s filling with smoke, visibility is zero and three people are missing. Thankfully, a group of Queen’s University students now know what to do. A new course on mine safety, offered on campus for the first time at the end of April, attracted mining engineering graduate students to such an extent that they stayed a week after term just to complete the valuable course. “Some schools offer downloadable safety courses that you work on from your computer,” said James Archibald, professor of mining engineering at Queen’s, “but this kind of hands-on, field training simply cannot be duplicated on a screen. It is an absolute necessity for these students.” During the first part of the week, students trained in a classroom. They learned how to detect different mine gases, assess cave-ins, operate complex breathing apparatus, work as a team and rescue trapped miners. Their final test took place in the basement of Goodwin Hall where a mock mine accident was constructed. They geared up, checked their instruments and headed into the smoke-filled, simulated shaft to find, evaluate and rescue three victims” who were quietly lying in the pitch-black conditions. “We had ten third- and fourth-year students taking this specialized class,”

Photo courtesy of Queen’s University

By Jeff Drake

Students participating in mine safety course

said Vic Pakalnis, professor of mining engineering, “and these students are now better equipped to deal with their own safety and the safety of others in this very important industry.” The Mines and Aggregates Safety and Health Association (MASHA) hosted the course. They provide mine safety training and support for the Mine Rescue Organization in Ontario. Students who pass the course receive a certificate from MASHA and join a force of about 800 volunteers that fights underground fires and rescues

Moving on up James Gill has been appointed chairman of the board at Denison Mines Corp. Gill has 40 years of experience in exploration, feasibility studies, mine development and operations, and metal and concentrate marketing. He incorporated Aur Resources and served at its president and CEO for 26 years, until its takeover by Teck two years ago. Denison also named Ron Hochstein as president and CEO. Hochstein, who has been with Denison for about ten years, was previously the company’s president and COO. 18 | CIM Magazine | Vol. 4, No. 5

trapped or injured workers. The mining industry in Canada is among the safest in the world and the Queen’s Mining Department is the largest in the country. The organizers of this year’s event hope to place Queen’s graduates as safety advocates at every mine in Canada. “These mining engineering students will go on to be managers,” commented Oscar Rielo, chief technologist, mining engineering. “This is important because they can enforce safety from the top levels. They will make the decisions on what happens inside the mines.” This first safety course was such a success that the Department of Mining Engineering hopes to soon offer it twice a year, with sessions in the spring and fall. CIM Reproduced with permission from the Queen’s Gazette. www.queensu.ca www.masha.on.ca

upfront PROCESSING by Binod Sundararajan

Agility through simplicity Sometimes the most adaptable solutions are often the simplest ones Photo courtesy of Met-Chem

survey stage, engineers on the ground must determine all possible situations likely to arise, assess the risks and success factors of alternative courses of action, put in place controls to mitigate those risks and, most importantly, constantly evaluate and monitor progress in order to agilely and adaptively take corrective measures to keep the project on track. The story behind one exemplar of the natural agility of Canadian mining engineers was recounted by Daniel Houde, senior project manager at Met-Chem. Houde described a scenario at MetChem’s recently concluded Cerro de Maimon project in the Dominican Republic. Met-Chem’s client, GlobeStar Mining Corporation, runs a precious metals mine there. The orebody, containing both sulphide and oxide ores, was expected to mainly yield copper, but also minable quantities of gold and silver. Coming on board around the project’s midway mark, Houde, along with other Met-Chem and local engineers, quickly determined that in order to finish the project on time, they would need to procure equipment for the milling and crushing plants in double-quick time. Simultaneously, after assessing the quality and grade of the ore, Met-Chem designers and planners also determined that it would be best to go with the tried and tested methods of milling, crushing, grinding and metal recovery. This decided, the team determined that it would be feasible, fast and cost-effective to procure high-quality used equipment for the plant, given that this was a relatively small mine operation. Met-Chem engineers carefully evaluated the Montreal-based manufacturers of much of the required equipment and figured out an innovative way to ship it to the island mine site. Since considerable quantities of silver were present in the ore, the process engineers opted to use the MerrillCrowe process and counter-current decantation (CCD) as opposed to traditional carbon leaching or carbon-in-pulp processes. This design decision immediately impacted the nature of the rest of the plant and tailings pond design, and the type of equipment to procure.

Cerro de Maimon project in the Dominican Republic

he last couple of decades have seen a move by manufacturing and marketing companies towards operational methods described as “agile.” Simply stated, agility indicates the deployment of processes and tools to respond quickly to customer needs and market changes without compromising budget, time, quality and profitability targets. While the catalysts for this move include recent technological advances and the increased availability of Six Sigma and Lean Process experts, the most important drivers are the attitudes of people and organizations who have imbibed agility into their work ethics and organizational cultures. The world-leading Canadian mining industry comprises many such organizations and experts who have incorporated agile practices into everything that they do, be it plant design, mineral processing, material handling or procurement. The challenges that mining engineers routinely face require agility and adaptability not in just how they do things, but also in where they have to do them.

Mid-term results Because mining is a complex, multi-process business, mining engineers and project managers, first and foremost, have to establish a trust-based working relationship with their clients or employers. Right from the initial 20 | CIM Magazine | Vol. 4, No. 5

upfront PROCESSING

Simply the best The Cerro de Maimon project required constant adaptation on many fronts on Met-Chem’s part. The site was located in rough terrain in the middle of an island. This created major transportation issues not just for the people, but also for the equipment. Additional challenges were posed by the weather (this is hurricane country) and the language (knowledge of Spanish, though not an absolute necessity, was nevertheless quite advantageous). Despite these hurdles, Rocio Ramirez, marketing manager at Met-Chem, reported that they “finished the job on time, within budget and to the enormous delight of their client.” The engineers and project managers of MetChem demonstrated agility and adaptability in their approach, their thinking and their execution.

The beauty and elegance of the solutions they devised lay in their simplicity. First, it confirmed that the tried and tested can, at times, work just as effectively as the state-ofthe-art. Perhaps more importantly, it confirmed that relationships with the client are paramount. This, perhaps, is the secret of agile mining — keep it simple, make it quick and do it right. CIM www.met-chem.com

Achievements IOC CEO among the best in the region The Atlantic Business Magazine has named Terrence Bowles, president and CEO of the Iron Ore Company of Canada (IOC), one of the Top 50 CEOs in Atlantic Canada. The award has, over the past 11 years, recognized and honoured the achievements of the region’s most capable business leaders. This year’s Top 50 list was compiled by a panel of judges that included prominent regional executives from among hundreds of entries sent in by the magazine’s readers. The panel made its selections based on the nominees’ corporate, community and industry involvement and contribution to their respective companies’ performance. Bowles, with his made-for-mining combination of credentials in engineering and management, began his mining career with QIT-Fer et Titane in 1971, becoming president in 1996. In 2001, he became the president and CEO of IOC. Speaking at the awards ceremony, Bowles said: “We have all been working hard every single day to get to the level we are operating at today. It is the dedication of the employees that makes success possible.”

The Power of Collaboration The Mining Industry Human Resources Council Your source for Human Resource solutions and information to build strength, competitiveness and sustainability throughout the Canadian mining industry.

Visit www.MiHR.ca for valuable resources

August 2009 | 21

upfront SUSTAINABILIT Y by Marlene Eisner

The making of good agreements A three-step approach “There were certainly challenges for us as a mining company,” admitted Lougheed. “It was explained to us that we were conducting work on the traditional lands of the Wahgoshig First Nation, but when we asked for the territory to be explained to us — what it meant, where it was and how it was defined — there were few answers. It was understanding the meaning of these things that was difficult.”

Step two: Learning together

Paul McKenzie, Wahgoshig First Nation councillor (left), and Dave Russell, president of Apollo Gold, at the grand opening of the Black Fox Mine.

ou don’t have to be a giant to have impact. The Wahgoshig First Nation is, by any standards, a small community. Only about 160 of the 278 people registered with the First Nation live on the 30-square-mile reserve located approximately 50 kilometres east of Matheson, Ontario. The Wahgoshigs’ traditional territory, however, is very large — the Wahgoshig people currently occupy a large part of land that is now known as Northeastearn Ontario and Northwestern Quebec. The Abitibi Reserve #70 (Wahgoshig) is adjacent to the Black Fox gold mine site, owned and operated by Apollo Gold, a Yukon-based company with head offices in Denver, Colorado. In September 2002, equipped with the proper government permits, Apollo Gold began exploration on land the company purchased in 2002 from Exall Resources.

Step one: Getting to know your neighbours In late 2003, Maurice J. Kistabish approached Apollo Gold and introduced himself as a representative of the Wahgoshig First Nation. Since Black Fox was located in traditional Wahgoshig territory, he explained that his community would like to enter into a relationship with the mining company. This came as somewhat of a surprise to Apollo Gold. “This was the first time we had heard of such a thing,” said Ryan Lougheed, general manager of the Black Fox project. Although the company was aware that the Canadian Mining Act states resource companies must consult with First Nations, there were no specific guidelines for Apollo to follow. At first, it all seemed a little confusing. 22 | CIM Magazine | Vol. 4, No. 5

Defining cultural, spiritual and traditional land-related rights is more complex than stating specific terms and conditions. Without any historical reference, the Wahgoshig felt that Apollo was unable to understand the situation and their position. This was impeding the negotiations, conceded Kistabish, who coordinated and was the lead negotiator on the Wahgoshig First Nation-Apollo Gold Impact Benefits Agreement (IBA). “We found that the company knew little about First Nations,” said Kistabish. “We had to explain to them who we were, what a traditional territory and a reserve land base are and what the difference between the two is. There was a lot of education to be done.” What followed was an opening of minds and a learning experience that benefitted both sides. Apollo Gold was welcomed into the Wahgoshig community to meet the people and understand how they viewed the land and their need for education and employment. Apollo Gold invited members of the community to a shareholder meeting in Denver, to experience first-hand how the mining company conducted business. The turning point came in 2007, just after Apollo Gold and the Wahgoshig entered in a memorandum of understanding (MOU). “We attended the Working Together Conference in Timmins with the Wahgoshig representatives where we learned about Treaty 9 issues with respect to the government and the First Nations, and understood the First Nations’ need for education and employment,” explained Lougheed. “It was very enlightening.”

Step three: Defining the needs of both partners Every First Nation community is as unique as every mining project, as Lougheed acknowledged. “First and foremost, as the industry understands, every mine site is like a snowflake, as is every First Nations community,” he commented. “In developing a process and a relationship with a First Nation, it is of utmost importance to understand the community that you are working with, understand the wants, the needs, the difficulties, the background and, most importantly, to have a proactive and productive relationship.”

upfront SUSTAINABILIT Y

For the Wahgoshig, their IBA had to include not only training and education for members of their community, but also a process to develop joint ventures that would give them a competitive edge. “One of the objectives was to look at something long term and consistent,” said Wahgoshig Chief Dave Babins. “We wanted to create an economic base for our community so that we can keep our kids in the community. The government, at one time, kept us in a box. We want to venture out and survive today, and we also want to change with the times and make sure we have the opportunities while they are in our territories.”

Joint ventures

heavy equipment company Leo Allarie come on board to form Wahgoshig Allarie Construction. “These joint ventures mean we are developing a healthy workforce,” said Boyden. “One of things we have discovered is that we have to have people from within the community attached to each major project, otherwise we’re just depending on consultants from outside. When people from the community are attached to a project, they own it mentally.”

Moving in the right direction The results have been immediately rewarding for both sides. Apollo has a ready, skilled and close-at-hand workforce, and the Wahgoshig are becoming a thriving community. With a projected mine life of eight years, Apollo will continue exploration activities surrounding the Black Fox gold mine that will include “working with the First Nations in all those areas,” said Lougheed. For the Wahgoshig, the long-term future is looking bright. “Mining is so exciting because there are so many different career options for people — from managers and healthcare workers to operators and tradesmen,” said Boyden. “We’ve got a very close relationship with Apollo and they have been so willing to be there. That’s what has made this relationship work so well.” CIM

Vi s Au it us g 2 at 3 ~ CO 26 M

Finalizing the IBA is still a few months away, said Lougheed, but to date, everything is moving in a positive direction for everyone. As of June 1, the mine had entered into commercial production. Of its 157 employees, 10 are from Wahgoshig First Nation. Approximately one-third of the contracts are joint ventures, approximately a third of which are with Wahgoshig companies. A unique aspect of this partnership is that although the IBA is not yet finalized, some elements of the agreement have already been implemented. Since construction began last September, the Wahgoshig wanted in on the action right from the get-go. “Implementing at the same time as we are finalizing the IBA is a challenge,” conceded Mary Boyden, Wahgoshig’s mining initiatives development officer. “Apollo www.apollogold.com has been an excellent and willing partner and when it comes to the IBA itself, we couldn’t have asked for a better company recognizing our interests.” After just a few months of implementing joint ventures, the 90 per cent unemAMEC develops some of the most ployment rate of the Wahgoshig has challenging mining projects in the world. shifted dramatically to an employment rate of 85 to 95 percent since January Bring AMEC’s experience to your project in: 2009. With their history of working with geotechnical engineering and front-end studies the forestry industry, the Wahgoshig environmental services metallurgical process development already had a roster of skilled equipment project and construction operators, highway truck drivers and peo facility and plant design management ple with construction experience. The key was to transfer these skills to the mining industry, as well as to offer additional training and educational opportunities. “We also have a very good detail of people who do brush and line cutting,” explained Boyden. “Our first joint venture was for industrial construction and the second one was a pit-stripping project with Apollo.” Other joint ventures are with CMS Mechanico and Wahgoshig Industrial Services, which provide industrial conmining@amec.com struction services throughout the territories. Yet another joint venture has seen the

August 2009 | 23

upfront TECHNOLOGY by Jocelyn Bouchard and Mar tin Émond

Who you gonna call? The difference between process control, instrumentation and control systems expertise Photos courtesy of Xstrata Nickel

• Are the signals used in the PLC, for process control purposes, properly sampled and filtered? Are the PID controller configurations consistent? • Are the control strategies appropriate? Do the controllers require sporadic manual adjustments by the operator? Are the process constraints and interactions properly handled in the PLC? What is the method used for PID tuning? Do existing control strategies take advantage of cascade, feed forward and multivariable configurations? In other words, the root causes of the problems need to be examined. One needs to determine whether the problem is related to instrumentation, control systems or process control. Where to start investigating and who to consult are also important considerations. There is no such thing as an omniscient expert. Instrumentation, control systems and process control are closely interrelated, and expertise in any one of these fields will imply some fundamental knowledge in the others. However, proper design and efficient troubleshooting generally requires more than basic knowledge — this means it will often take more than one expert to tackle the problem. Where does one start? Here are some tips.

The control room at Xstrata Nickel’s Nickel Rim operation

oor little Johnny; he had excitedly assembled his first bicycle all by himself only to discover that it just won’t go, even though it looks fine. Then again, the instructions were not exactly crystal clear. Frustrated, he declares his shiny new bike a lemon and asks his parents to replace it. After a little investigation, Johnny’s father found that his son had made a few mistakes while assembling the kit — the brakes were not tight enough and it was impossible to switch gears. When fixed by a competent shop, the lemon was transformed into the dream bicycle his son had dreamed of. But what does this have to do with process control in mining, you might rightfully ask? However fanciful or seemingly simplistic Johnny’s scenario might sound, it is not dissimilar to the frustrations that process control personnel may encounter at a mill. An technician might spend his days wrestling with a stubborn PLC (programmable logic controller), trying to stabilize the grinding circuit to stop the level of flotation cells from oscillating, only to discover that nothing works. As in the case of Johnny, he may wrongfully think that he has a lemon or that the process is too complex to be handled by the PLC using PID (proportional integral derivative) controllers, and an expert system is required.

Asking the right questions In such process control situations several questions need to be addressed: • What kind of instrumentation is in place? Is the right technology always used? Do the installations always follow best practices? 24 | CIM Magazine | Vol. 4, No. 5

Instrumentation These problems are so common that it is estimated that 30 per cent of control valves exhibit mechanical problems and that 15 per cent of instruments and control systems are not installed properly. To avoid these problems, one should look for multiple references — suppliers, users, consultants, integrators, etc. — with whom to develop a network and share your own experience. It is also useful to carry out trials with new technologies. You can always team up with manufacturers and suppliers to share the risk and even develop your own in-house expertise. Although it seems obvious, it is worth stressing that you must always follow the instrument manufacturer’s installation specifications. Finally, it is highly recommended that you work with recognized integrators — they spend 90 per cent of their time solving issues that you encounter 10 per cent of your time. They could save you a lot of trouble.

Control systems It is vital to make the distinction between the content and the container. A skilled PLC or DCS (distributed control system) programmer is not a process control expert. Developing

upfront TECHNOLOGY

Control room at Falcondo

competent in-house programming resources is easier than developing process control expertise. Always ensure that the PID configuration standards are reviewed by recognized and competent process control experts. Ask for their records and talk to their customers (e.g. to investigate whether the control strategies they commissioned are still in place). Also, do not hesitate to ask for external auditing of the control system. Finally, trust your instincts. If you are not fully satisfied with what you get from your PLC or DCS, or if the operator interface (HMI) does not meet your expectations, it is unlikely that industry best practice standards will be met.

being limited by the control system capabilities. The power, robustness and versatility of PID controllers are generally underestimated. Nonlinearities, interactions and multivariable systems do not preclude their use. Keeping it simple is still the best approach for maximum robustness and reliability. Designing advanced control strategies and implementing them in a PLC or DCS may require external resources. However, when applicable, maximizing the use of the existing control system is by far more cost-effective than buying an external system (expert systems, optimizers, etc.). Optimizing the PID controller tunings and control strategies represents the best possible return on investment because it takes advantage of equipment that has already been paid for and installed. Instrumentation, control system and process control issues can sometimes look burdensome until you ask the right person. Do not accept the status quo and do not be afraid of paradigm shifts. While there are clear links between the three fields, they need to be clearly differentiated. Expecting a single person to wear all three hats at once is unrealistic. Only with a clear understanding of the distinct fields and a full appreciation of each expert’s specific expertise is it possible to ensure optimal control. CIM www.xstrata.com

Process control

About the authors

Process control is the poor cousin of instrumentation and control systems. Unlike with instruments and control systems, where failures are glaring and demand to be fixed as soon as possible, shaky process control is often seen as acceptable. It is not uncommon to encounter default factory PID tunings in operating plants. So pervasive is the lack of attention to this area that a fifth of all control loops are improperly designed and a whopping 85 per cent of them are improperly tuned. In fact, 30 per cent of control loops cannot be operated in “auto” because the tuning parameters do not make any sense. PIDs represent 97 per cent of all controllers encountered on the market. However, only 25 per cent of PID controllers contribute to reducing variability when they operate in automatic. Using the trial-and-error approach to tuning is time-consuming and is unlikely to lead to optimal performance. Only a systematic method can yield robust and sustainable benefits. Closing the loop is the last step, as proper process control relies on proper instrumentation and control systems. Process control experts have a global vision of the situation and are well-equipped to identify where the problem originates. It is important to bear in mind that nowadays, PLCs and DCSs are very powerful. One can go a long way before

Jocelyn Bouchard and Martin Émond are process control engineers at Xstrata Process Support. They have a combined 30 years of experience in fundamental and advanced industrial process control. For any questions and comments: jbouchard@xtrataps.ca.

Giving Back Syncrude steps up to the plate Oil sands giant Syncrude Canada Ltd. has signed a three-year sponsorship agreement with Fort McMurray’s Minor Baseball League. Under the $50,000-a-year agreement, Syncrude will have naming rights to the press box and canteen at the Ron Morgan Baseball Park. Syncrude’s president and CEO Tom Katinas said: “Syncrude is proud to support youth recreation here in this region. Our young people are great ambassadors for the Wood Buffalo region and we feel it is important to help reinforce the many positive attributes of our community.” This sponsorship is part of Syncrude’s community investment program under the aegis of which the company has contributed over $12.5 million to various community ventures since 2006. August 2009 | 25

upfront OUTREACH by Jim Mar tin

Teaching the business of the mineral resources industry Mineral economics at Queen’s University Photo courtesy of Queen’s University

prepares future engineers to understand and calculate the minimum rate of return firms will find acceptable for making project decisions. This is central to the economics of running a mineral resources business. Built on lectures, individual assignments and a group project, the undergraduate course, in which 75 students were enrolled last year, uses examples of current business situations to generate discussion. This past year, students looked at the proposed capital injection by Chinalco into Rio-Tinto (which has since been cancelled). Students have the added benefit of closely studying potential future employers, gaining knowledge that can be very useful when they start their careers. The program covers a range of topics including an introduction to economic evaluation; the concepts of cash flow and its estimation; the time value of money and net smelter return; determining costs; understanding taxation; the effects of inflation; risk and sensitivity analyses; the basics of exploration economics; the equipment replacement decision-making process; financial analysis of mining companies; and the valuation of projects and firms. The group project encourages long-term thinking about operations and finance as a counterbalance against the short-term cyclicality of certain enterprises, commodity markets and the stock market, generally. Teams of four members, comprised of a mix of mining and geological engineers, each choose a mining company and an oil and gas company to review. This past year, the companies reviewed included Barrick Gold Corporation, BHP Billiton, Canadian Natural Resources Ltd., Chevron, EnCana, ExxonMobil, Husky Energy, Kinross Gold Corporation, Nexen Inc., Petro-Canada, PotashCorp, Suncor, Vale Inco and Xstrata. The first part of the project required teams to present a company-wide summary of their subject companies’ operating strategies and results over the 2007 to 2009 YTD period. The second part focused on the financial implications of the operating results and the entity’s financial strategy. Needless to say, in the 2009 winter term, the students

Queen’s University students

eaching mineral economics at the undergraduate level has been a tradition at Queen’s University for many decades. Committed to offering top-ranked mineral economics training to complement its strong mining and geological engineering programs, the university prides itself on having faculty with deep, realworld understanding of the subject, and places the emphasis on the application of economic analysis techniques in the resources industry. Mineral economics is taught as a core undergraduate course within the Faculty of Applied Science to mining and geological engineering students and is also open to geological sciences students from the Faculty of Arts and Sciences. A graduate-level course is also taught within the mining engineering program. Queen’s places the emphasis on the application of economic analysis techniques within geological exploration, mine development and equipment replacement. The undergraduate course imparts important skills to aid students in their engineering design courses and projects. It is also a vital part of preparing them for their careers when, as engineers, many will be involved in project management, enterprise management and strategic planning processes at mineral resources companies. At a business-enterprise level, students are introduced to how capital is raised and used, the various sources of capital and the calculation of associated costs. This

26 | CIM Magazine | Vol. 4, No. 5

upfront OUTREACH

were analyzing companies during a very turbulent period. The point of the project is to observe and understand the interconnection between operating and financial strategies at an enterprise-wide level. A brief report, with backup, is required for each of the operations and financial sections. At the graduate level, the course is more intensive and includes such topics as accounting, economics and financial analysis in geologic and mining situations; economic analysis methods used in the resources industry; considerations of business structure, legal issues and taxation; the financial management of the mining and oil and gas enterprises; comprehensive mineral project and enterprise valuation; and strategic business planning. There is also a group project in which students study a major Canadian mining company (this past year it was Teck) and the class prepares a business plan based on public information, their undergraduate engineering training and the techniques taught in the course. Thus, the Queen’s University program provides students with a deep theoretical and strongly practical understanding of the role of finance and economics in the mineral resources industry. Teaching the practical application of mineral economics remains a key part of Queen’s long-term strategy for its Department of Mining Engineering. We believe that it is vital for our future

engineers and geologists to understand the monetary side of the business as thoroughly as they comprehend its technical and scientific aspects. CIM Queen’s University welcomes enquiries from prospective undergraduate and graduate students, alumni, researchers, government and industry. Please contact us at http://www.mine.queensu.ca/

About the author Jim Martin started teaching mineral economics at Queen’s University recently, bringing with him more than 30 years of industry experience. He holds a B.Sc. Eng. (geological engineering) from Queen’s University, an M.Sc. in mineral engineering from Stanford University, and an MBA from the University of Toronto. He was elected by alumni in 2006 for a sixyear term on the Queen’s University Council.

Course receives high grades udging by student evaluation and feedback, the mineral economics course at Queen’s has been very wellreceived indeed. “I feel that the instructor is speaking from a position of industry experience, and can include real examples from his career,” said one student.

Some students appreciated the “new interesting material” they were provided, while another thought that the “course notes were spectacular. Assignments were topical and relevant. The teacher was very knowledgeable, and able to explain everything.” On the usefulness of the course, too, there is little doubt in the students’ minds. “I did learn a lot because there’s no other course like this,” wrote one student. Another felt that “…economics is important for engineers.” “Interesting material applicable to real life,” is how one student characterized the course. That mineral economics training is an essential part of mining-related education is clearly more than just an opinion held by the Queen’s faculty. The students seem to want more of it too. Their number one suggestion, “more examples in class,” reveals that students are as hungry for practicable economics training as their teachers are eager to impart it.

August 2009 | 27

upfront Q&A by Mike Paduada

A conversation with Canada’s CFO of the Year Agnico-Eagle’s David Garofalo shares his thoughts on a range of topics including working with investors, controlling costs and predicting commodity trends CIM: The opening of the Kittilä mine is very exciting. What are you trying to accomplish during these site visits? Garofalo: It’s very helpful for me to bring investors and credit providers out to the mine site. What jumps out at people is how well-engineered, well-kept, safe and professionally run our mines are, and how cohesive our employee group is. You don’t see that looking at the financial model or speaking to executives at head office. I’ve found that doing site visits has always been a tremendous facilitator for financing, whether it’s banks, equity markets or debt markets.

David Garofalo

n spite of constrained capital availability and riskaverse attitudes, some mining companies, and some people, are keeping busier than others. Perhaps one of the busiest is David Garofalo, senior vicepresident, finance and CFO of Agnico-Eagle Mines Limited. Garofalo has been helping Agnico-Eagle steer through choppy economic waters towards ambitious expansion objectives. He was recently named Canada’s CFO of the Year, an award presented annually by Financial Executives International (FEI) Canada, PricewaterhouseCoopers LLP and The Caldwell Partners International. Given the broad award criteria — vision and leadership, corporate reporting and performance, social responsibility, innovation and business complexity — Garofalo has certainly accomplished quite the balancing act. During an investor and analyst site visit of the Kittilä mine in Finland in June, David shared some thoughts with CIM Magazine. 28 | CIM Magazine | Vol. 4, No. 5

CIM: Do site visits alleviate anxieties about risk better than a financial model would? Garofalo: Absolutely. You get a sense of the scale and scope of operations when you’re on site. You can’t get that on paper in a financial model. Right now it’s a very tight credit market. In fact, I’d characterize it as very bifurcated. Good companies can still get money, though capital cost has gone up. Companies with single or undeveloped assets and companies that don’t have a history of building or operating mines probably can’t get any credit at all. So, having our scale and track record is a big advantage. That jumps out at you when you go out to sites and see what we have here. The cohesive employee group, the skill sets, the hundreds of engineers and geologists that we have on staff are a tremendous advantage that we can leverage to help showcase our operations to credit providers. Right now, we’re actually in the middle of expanding our credit facilities. It’s in syndication and is going well. The credit margins have widened, but we can still get money from banks. CIM: Would you please explain Agnico-Eagle’s policy of not participating in gold forward markets? How does it work for you? Garofalo: That’s a philosophical decision we made a long time ago. We think that investors in gold stock want to be exposed to the gold price — up and down. They want full beta to bullion. Our best hedge against falling gold prices is low-cost operations. We have low-cost operations because we have assets of significant scale. We reap economies of scale at the operational level and have a naturally low-cost structure. Also, because we essentially build our deposits out ourselves, our total costs tend to be lower. We have a much lower cost structure, even when you include recovery of your capital expenditures. That’s our hedge; that’s how we look at it.

upfront Q&A

CIM: One of the considerations for the CFO of the Year award is corporate social responsibility. How is a CFO positioned to deal with issues of corporate social responsibility? Garofalo: It’s pretty fundamental. You really can’t raise capital unless you have a game plan for dealing with environmental reclamation and securing the social licence to operate in various communities. In this market, creditors and investors will not provide capital without ensuring responsibility in that regard. I’m acutely aware of what our corporate social responsibility programs are. Am I directly responsible for those programs? No, but I am responsible for ensuring they are communicated properly to capital providers. CIM: There have been discussions lately, for example, in the Mining Finance and Management Day at the last CIM Conference and Exhibition, about mineral economics and education. In your view, how important are courses like mineral economics and accounting in mining-related university programs? Garofalo: I think it is important because, at the end of the day, it’s not just about digging holes in the ground. It’s about extracting minerals on an economic basis and generating returns on investment. I think that’s been a criticism from investors in the past, because it’s such a capital-intensive business. Sometimes focus is lost on that return on investment. Having that integrated into engineering and technical programs makes a lot of sense. CIM: Do you have any thoughts on real options or other advanced valuation methods? Garofalo: I prefer to keep it simple. I like discounted cash flow and rate of return analysis. Real option valuation and Monte Carlo methodology probably overly complicates what I think should be a relatively simple analysis. Does it generate a rate of return? Does it generate accretion on a per-share basis? Those are fairly simple metrics, and at the end of the day they’re at the level of most value. CIM: How important is investment in innovation for the mining industry? For example, what should companies be spending as a percentage of their revenues? Garofalo: By definition, the mineral exploration business is R&D. We’re a collection of finite life assets, and we have to continually re-invest in the ground or replace what we’re pulling out. R&D is a necessity. But, I don’t know if there’s a fixed percentage or a rule of thumb that makes sense. We have done some R&D, for example, on water treatment. We use a bio-leach process at LaRonde so that we can discharge potable water back into the environment. That is an innovation we’ve developed internally that we can leverage in our existing operations. If you ask me what percentage of revenue to spend on exploration, I’d say probably 10 per cent — to regenerate what you’re pulling out of the ground.

CIM: Among senior management positions, the CFO role is one that probably sees more turnover than others. Do you have any advice to company directors on selecting a CFO? Garofalo: I think you want someone who understands the various sources of capital very well. Given the capital intensity of the business, you need someone who knows how to raise money. Whether it’s something in the development stage, or something that’s mature and needs corporate facilities to sustain operations and maintain liquidity for new opportunities, you need someone who understands and can access various sources of capital at the appropriate time while maintaining a low cost of capital. I think that keeping a company adequately liquid is probably a CFOs most important job. Try to find somebody who fits the stage that a company is in. There isn’t one-size-fits-all for CFOs. Junior level companies that are developing an asset probably need somebody who understands project debt financing very well and can bring in appropriate creditors multilaterally. A more mature company might require somebody who understands the capital markets, corporate lending relationships and trading relationships to ensure there are adequate trading lines to sustain the business on an ongoing basis. Making sure somebody understands the capital needs, at that stage for that company, is probably the most important criterion for a board. CIM: Do you have any advice for bankers to better understand the minerals industry? Garofalo: I think it’s important that bankers understand corporate strategy, above all. Sometimes bankers tend to throw a lot of ideas against a wall to see what sticks, rather than understand what the core strategy of a company really is. Ensuring that they tailor their opportunities for that client so that they’re not wasting time is probably the most important thing they can do. Understanding your client’s business helps you pitch ideas that are most appropriate for their strategy or their capital structure. CIM: Lastly, what are your thoughts on commodity markets, in general, looking forward? Garofalo: I’m bullish on that. I think there’s going to be price inflation across the commodity complex — oil, base metals and certainly gold — because of all the monetary supply that’s been introduced in industrialized nations. Gold is a very accurate barometer of inflation and is doing well now and will continue to do so because inflation is coming. I think there’ll be an economic rebound in the short to medium term because of the stimulus activity that has been introduced. I’m afraid when inflation goes up, however, that interest rates will have to increase and may choke off economic growth. We may enter a period where growth is pretty stagnant because of the need for central banks to deal with inflation. But in the short to medium term, the inflation impact on the commodity complex could be quite significant. CIM www.agnico-eagle.com August 2009 | 29

Daniel Dumas talks with shaft miners in front of sinking buckets at the Lakeshore Gold Timmins project. Photo courtesy of Dumas Contracting Ltd. Photo by Claude G. Gagnon

the power of people

Can it be done? Can it be done better? Mining the specialists to extract the most from human and natural resources by Ryan Bergen

Photo courtesy of Michelin

inerals and metals — impassive, unrefined and hidden by overburden — may make an otherwise unremarkable hinterland outpost interesting. However, it is the readily mined energy and knowledge of experts engaged in developing these resources that puts these places on the map. While they are not the raison d’être of the industry, they are its savoir faire. The “unsung heroes” of the industry — contractors and consultants, researchers and service providers — do not have mines bearing their names, but their identities and character are built into operations around the globe.

Treasures in the trash With each operation, there is value to be unearthed, but also hidden potential in the day-to-day processes to be harnessed. From the earliest studies, through the construction and evolution of the mine and the industry, to shutdown and reclamation, new lessons can be learned and applied, and new tools brought into service. “Nine or ten years ago, we looked at how our earthmoving equipment tires were being used,” recounted Michael Reich, training manager for Michelin. “In the scrap pile of a typical quarry, we’d find that as much as half the tread was left on the tire when it came out of service, no matter what brand it was. This was an asset the company was underutilizing in a dramatic manner. With any product, if you only use 50 per cent of it, you would be disappointed.” In response, the company developed an end-user seminar that brought together operators, dealers and Michelin representatives to work out ways to get more value from the product. Reich said that the constrained supply of the past several years has motivated mining companies to learn how to get the most out of their tires. “In the last three or four years, end-users have been more receptive to change,” he said. “Now we’ve seen people double their tire life and, even though tire supply has gotten better in most sizes, we don’t see a lot of the people going back to their bad habits.”

Worker performing tread measurement

The key to mining value from the seminar, explained Reich, is letting end-users be active in it. “These guys’ jobs are not to use tires, its to move material,” he said. “If we simply dictate to them what they should do, when it is not practical, they won’t do it. So, on the final day of our seminar, we develop a plan with each customer to improve their tire performance. Then, six months later, I follow up to see how they are doing.”

Fitting in No project gets off the ground — or into it — without a solid organizational infrastructure and well-defined working relationship. “If we bring in a contractor, it is absolutely imperative that they comply with our safety, health and environmental requirements and with anything pertaining to the wellbeing of our workforce,” explained Ingrid Hann, vice-president of human resources for De Beers Canada. The answer, according to Greg Oryall, vice-president of business development and strategy for AMEC, is “to have very clear delineation of responsibilities, so that important August 2009 | 31

Photo courtesy of De Beers Canada

the power of people

A tour of the De Beers Canada Snap Lake operation

things like safety don’t fall through the cracks.” Among the global engineering and project management company’s recent work is the development of De Beers’ Snap Lake and Victor mines in the Northwest Territories and Ontario, respectively. With value as the aim, every engagement with the client ought to bear fruit, said Greg Fauquier global managing director of metals and mineral processing for the Hatch Group, which provides engineering, procurement and construction management to mining operations around the world. “We have our own internal safety and health program that can be, in some cases, stronger than our client’s program. We leverage our internal knowledge against that of our client’s business and try to improve upon their perspective on safety and health.” Among Hatch’s many alliances is one with the Mosaic Corporation to help it expand potash production at its facility near Colonsay, Saskatchewan.

Under pressure These days, the mantra of “added value” that inspires consultants is often met by the industry’s own chant of “cost cutting.” Hann, however, suggested that while operators may be circling new projects a little more warily, the economic slowdown presents opportunities for collaboration. Whether the challenge is within the business structure or in technical aspects of the operation, she said: “You now may be able to afford the time to ensure that the processes are unfolding as they should and whether there are any impediments. Now is the time to iron them out and 32 | CIM Magazine | Vol. 4, No. 5

maybe do some overhaul work that you normally can’t do because you are working at a full pace. The recession allows you to evaluate where you had some snags and to bring a contractor in to help streamline that part of the business.” Naturally, the call for reappraisal and reassessment rings true from the contractor’s perspective as well. “We have reworked our management structures and made them leaner,” said Chris Yellowega, vice-president, operations for North American Construction Group. “This will save us money and make us a lot more competitive in the future. If someone needs to make a decision in the field, there are fewer layers they have to go through.” One positive to be drawn from the current downturn is that it allows more clarity in the framing of projects, explained Yellowega, citing the shifting fortunes in the West. “When the Alberta economy was so hot, there were a lot of add-on components to the cost structure — things like employee retention and living out allowances — that are variable costs that come and go. With the slowdown, a lot of those add-on costs have gone away and we are now bidding a much more traditional cost structure for labour on remote sites.” Nevertheless, when it comes to developing partnerships, the fundamentals endure, said Yellowega. “The key to capturing projects in the recession is not only to be very competitive on your pricing, but also to make sure that when you arrive on the site for a project that you are wellprepared to execute it, properly trained and well-versed in the client’s needs,” he said.

the power of people

Photo courtesy of AMEC

The legacy of this era of tight purse strings and tough decisions canâ&#x20AC;&#x2122;t be known yet, but how resources are allocated now will go a long way to defining it. Over time, the industry has seen increased productivity from its workforce, but that progress is not inevitable. As volatile as the industry is, the educational infrastructure that feeds it requires continuity, said Steve Hall. As CEO of Ontario-based Mining Innovation, Rehabilitation and Applied Research Corporation (MIRARCO), it is Hallâ&#x20AC;&#x2122;s task to align students, researchers and their projects with industry to develop capacity in the next generation of Canadian mining professionals and in the tools that the AMECâ&#x20AC;&#x2122;s training and development group develops skills and training solutions to mitigate risk for clients around the world. industry eventually adopts. Research and development, With each new project, clients have access to the though, take time, which is one of the chief lessons MIRARCO teaches. â&#x20AC;&#x153;There is value in instilling in students expertise of consultantsâ&#x20AC;&#x2122; global networks. â&#x20AC;&#x153;The only thing an understanding of the research process,â&#x20AC;? said Hall. â&#x20AC;&#x153;It is we have to sell is knowledge,â&#x20AC;? said Fauquier. â&#x20AC;&#x153;We will sit important for any country that is going to be based on a down and analyze the lessons learned from our bigger knowledge economy and innovation. You have to be prepared for false starts in research and understand that it is a process, that it can take a number of years to establish capacity and excellence, and that capacity can be easily lost if the supporting infrastructure is fragile.â&#x20AC;?

Long reach, quick feet The global expansion of resource development has sparked projects around the world. Moving across hemispheres, from the tropics to the Subarctic, has forced firms competing for business to be strong, but also wellbalanced and nimble. â&#x20AC;&#x153;If we are working on a project in Asia, we can draw on our office in China to provide local procurement, logistics, construction management, design and so on,â&#x20AC;? explained AMECâ&#x20AC;&#x2122;s Oryall. â&#x20AC;&#x153;If we are doing a project in South America, our mining and metals group has a large office in Santiago, Chile, and an office in Lima and a presence in Brazil. We can work out of those locations, but we can also draw on office locations and resources from any of our divisions of the company,â&#x20AC;? The smooth flow of experience and knowledge also serve as important anchors when working on several continents concurrently. â&#x20AC;&#x153;We drive our global business through our business units almost assuming an absence of regions,â&#x20AC;? said Hatchâ&#x20AC;&#x2122;s Fauquier. â&#x20AC;&#x153;This allows us to transfer resources and knowledge uninhibited by regional constraints. If we operated on a regional basis and each office was rewarded on the basis of profits and productivity, no regional division would be likely to give over its people. They covet those people.â&#x20AC;?

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August 2009 | 33

Photo courtesy of DeBeers Canada

the power of people Oryall. â&#x20AC;&#x153;This often entails teaming with community colleges and other institutions to start building a sustainable capability in the region.â&#x20AC;?

Open marriages

The smooth exchange of expertise between contractor and owner poses a particular challenge to consultants who spend years cultivating the skills of their employees. Sometimes individuals who have done so well at adding value are lured away by other contractors or, conversely, are not always eager to leave the operation at which they have been working. â&#x20AC;&#x153;Sometimes an employee who may have established roots at one of our operations may prefer to come work with us as opposed to living a nomad life with the contractor,â&#x20AC;? said Hann. However, she stressed that such processes are initiated by the individual. â&#x20AC;&#x153;It just Wade Bohnet (electrical apprentice) and Stephanie Smutylo (maintenance halper) at De Beers not good business to be stealing people from the Canadaâ&#x20AC;&#x2122;s Snap Lake operation contractor,â&#x20AC;? she said. projects and convey those lessons through our organizaThe loosening of the labour market in the recent downtion, and specifically to projects that are about to take off.â&#x20AC;? turn, though, has also meant a change in fortunes on the Bringing any operation into production in a new region supply side as operators cut staff. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;ve been picking up inevitably means building the capacity to staff it. â&#x20AC;&#x153;If we are some really great peopleâ&#x20AC;?, said Sandy Woodhouse, human working in a location where there is not a well-established resources director for AMECâ&#x20AC;&#x2122;s Mining and Metals Group. workforce for the owner to tap into, then our in-house â&#x20AC;&#x153;Of course, even in boom times we do have people come training and development group can help develop a skills from the operations side for the opportunity to work with assessment and a training needs analysis in the region and the people who are renowned world experts in their field.â&#x20AC;? help them put together training and recruitment plans,â&#x20AC;? said â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s a catch 22,â&#x20AC;? reflected Fauquier. â&#x20AC;&#x153;We have a strong technical base in our company and place an emphasis on people who Diavik, NT intend to grow their careers with us. Kearl Lake, AB That means they may have more to offer than some of those guys who fly between companies every year or so. As a consequence, that also makes our employees more attractive to our Raglan, QC %XFNVNLQ 0LQLQJ :< clients. On the other hand it can sometimes be an advantage for our employees to move on into operations because, presumably, that Jobs Done Well. means that theyâ&#x20AC;&#x2122;ve had a good career Voiseyâ&#x20AC;&#x2122;s Bay, NL :DOQXW &UHHN 7; For 125 years, Kiewit has always and good opportunities with Hatch. delivered. Weâ&#x20AC;&#x2122;ve evolved into one RI WKH ODUJHVW DQG PRVW UHVSHFWHG When they go with our clients they FRQVWUXFWLRQ DQG PLQLQJ RUJDQL]DWLRQV invite us back.â&#x20AC;? LQ 1RUWK $PHULFD $W .LHZLW ZH EXLOG TXDOLW\ SURMHFWV VDIHO\ RQ WLPH DQG RQ Though the vast reserves of minEXGJHW QR PDWWHU KRZ ODUJH RU VPDOO eral wealth yet to be unearthed PROVEN SUCCESS across Canada and the globe â&#x20AC;&#x201D; and Kiewit specialize in mine management, the money dedicated to extracting it production, maintenance and contract mining â&#x20AC;&#x201D; will always drive the industry, the ventures. Our mining team includes some direction forward will be plotted by Peter Kiewit Sons Co. of the most highly skilled and experienced people. Those piloting the massive 48(%(& 0RQWUHDO 2IÂżFH professionals in the industry. 450 435-5756 - 450 435-6764 fax machines, developing tomorrowâ&#x20AC;&#x2122;s :LWK VWURQJ ÂżQDQFLDO VWDELOLW\ HQGXULQJ 217$5,2 0LOWRQ 2IÂżFH technologies, conceiving the projects (905) 636-5000 - (905) 636-5001 fax ingenuity and evolving technology, Kiewit and grooming the next generation of continues to pursue new mining ventures $/%(57$ (GPRQWRQ 2IÂżFH highly qualified professionals will (780) 447-3509 - (780) 447-3202 fax DQG DFTXLVLWLRQV DQG LV XQLTXHO\ TXDOLÂżHG WR ensure the jobs get done and, where Visit our Website at kiewit.ca handle any size mining operation. possible, done better. CIM 34 | CIM Magazine | Vol. 4, No. 5

the power of people

Photo courtesy of Diavik Diamond Mine

Floyd Abel and Christy Black discuss their role play

Diavik blends cutting-edge management education with time-honoured traditional approaches by Marlene Eisner

n 2005, the Diavik Diamond Mine, located in the North Slave Region of the Northwest Territories, about 300 kilometres north of Yellowknife, created the Aboriginal Leadership Development Program. Built around the Southern Alberta Institute of Technology’s (SAIT) applied management certificate program, the goal was to help increase the number of qualified Aboriginal people at the mine’s supervisory and management levels. By the end of 2009 the program will boast approximately 50 graduates. A mix of Diavik employees and contractors, participants will have attended a series of twoand-a-half day workshops, once a month for a year. They will have received 188 hours of training, including 10 courses addressing 16 leadership competencies; monthly leadership development activities; guest lectures; and a mentoring program by Diavik management. When the

company decided to initiate this employee enhancement program, it invited various educational institutions to submit proposals outlining a pilot program. From among the many options, Diavik chose SAIT’s applied management certificate program. Employees who show leadership potential are nominated by their managers for the program. After the first year, the company hired Sarah Wright, a northern Aboriginal educator with global industry experience, to customize the program to meet its needs better.

Made-to-measure training A good learning environment is not always a one-sizefits-all scenario. Although the SAIT program was fundamentally sound, it needed to be fine-tuned. “There was an existing structure to the program but we did some considerable reworking,” explained Wright. “We added some August 2009 | 35

the power of people academic elements as well as specific northern Aboriginal content.” On the academic side, participants are introduced to 10 courses representing five areas of applied management that meet Diavik’s needs, such as organizational behaviour, finance for non-finance persons and interpersonal skills, to name a few. Flown in from the mine for their workshops, participants receive the full academic course, with the same quality and content as is offered to those who attend the course at SAIT. It is the presentation, rather than the content of the course, that is customized. To give the program a more local, northern focus, Wright incorporates approaches similar to those that Aboriginal teachers and leaders would use in their own communities in the Northwest Territories. Thus, in addition to the practical, the spiritual and cultural elements of the Aboriginal community get woven into the program. One example is how Wright begins and ends each session. With an interesting twist on the traditional sharing circle, she poses a question that is relevant to the topic being learned. “If we’re doing a course called ‘Introduction to Leadership Skills,’ I will ask them to describe someone who inspired them,” said Wright. “I use the principle of a council circle or sharing circle, where they can speak from the heart, listen from the heart, be spontaneous and be lean of expression.” In this way, each participant has the opportunity to speak and listen to others and to be present “in the moment” without thinking of other things or rehearsing their responses. Wright explained that this is an ancient Aboriginal approach to problem solving. Other elements of the customized program deal with personal well-being and conflict resolution. In a course called “Personal Toolkit,” the focus is on recognizing one’s wellness, managing emotions, self-care and taking personal time. “I think that in such a fast-paced work environment there is a tendency to not take that time,” explained Wright. “We decided to revamp that course to incorporate the Aboriginal view that mental, physical and spiritual balance is essential to be an effective leader.” The interactive program relies on experiential activities, as well as guest speakers, to help students integrate and understand the concepts. For the “Personal Toolkit” course, Wright invites a traditional healer to give a half-day workshop. “As an example, we worked with the group on the medicine wheel from a Dene approach to stress why leadership is not just about one person,” she said. “Different people have different talents or gifts. Likewise, people within a community have different leadership skills. We emphasize that there is a leader in each of us. Every one of us has a gift, and this is the opportunity to acknowledge and use them to be healthy contributors to the workplace and the community.” Photos, top to bottom: Establishing trust is part of a team-building course; John Tees and George Unka (drumming), Rob Laviolette, Merle Essau, Alfred Liske, Billy Squirrel, Sah Naji Kwe employee, Brad Ostafichuk (players) participate in a hand-game activity; Instructor Sarah Wright reads to the group participating in a leadership skills course. 36 | CIM Magazine | Vol. 4, No. 5

the power of people Team-building course at Sah Naji Kwe camp

and described how we felt. Hearing how people got through$ some tough times, we got to feel their difficulties. In %that sense, it was a really personally fulfilling " course.” Another plus, said Campbell, was meeting and other people from the company. Now, befriending ! when he & sees them in the hallway, he said, “I know ' their personalities better and it makes it feel like more & ” of a family.

2 / * Wright . said that with economic growth in the North, solutions 5 for sustainable long-term development will have to" integrate local knowledge. With her years of 5 experience working in Asia and Central America, she also understands the power of global experience. / “My 8intention is to move in and out from global to local so 9 we have a consciousness of indigenous issues /around the world,” she explained. She added that her* objective is to empower Aboriginal Peoples to 8 assume charge of their own destinies. “I encourage stu)

Bringing it all home

From the personal to the communal Rob Laviolette graduated from the Aboriginal leadership program in January 2009. The 31-year-old father of three has been a welder in mobile maintenance at Diavik since 2003. He said that despite not knowing what to expect from the program at first, he came away learning a lot about himself and his co-workers. While every course helped him achieve some of his own goals, it was the session on team building that really struck home. “Learning how to coach people and to help them figure out their problems revealed things on a personal level,” he explained. “I didn’t tend to have much patience and I wanted to learn how to deal with people better. I’ve been able to better myself that way. I’ve been able to defuse situations and help people with their problem solving. Even my morale has increased. There have been noticeable changes in my attitude, for sure.” Looking ahead, Laviolette would like to transfer the skills he acquired through the leadership program to areas outside work. “At the community level, I like to think of myself as a leader and I’d like to help in that area.” Aaron Campbell, a mineral processing technician, has been with Diavik for three years. A co-worker who graduated from the leadership program recommended it to him. “I went to my manager and said I would be interested if he could put in a nomination,” said the 24-year-old who is originally from Fort Resolution in the Northwest Territories. After some consultation, Campbell was accepted. “They thought I showed enough leadership on the floor,” he explained. Campbell said the conflict management courses, which involved a lot of group work, equipped him to interact more effectively with diverse people in different work situations. On a practical level, the session on budgeting finances helped him to manage and plan his finances. On a more personal level, he was able to get in touch with his own feelings and experience empathy for others. “We participated in a sharing circle where we passed a rock around

dents to be accountable. When we see the challenges for oppressed people elsewhere and see the power of proac7 tive problem+ solving, we are compelled to shift from feeling sorry for ourselves to asking what we are going to do about it.” CIM 3

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la force des gens Photo courtoisie de De Beers Canada

Sarah Tautuaqjik (aide d'entretien) et Chesley Keeping de Tli Cho Logistics à la mine Snap Lake de De Beers Canada

Tirer le meilleur des ressources humaines et des ressources minières

es minéraux et les métaux cachés sous les morts-terrains peuvent rendre des endroits éloignés attrayants. Cependant, ce qui compte véritablement c’est l’énergie et les connaissances des experts qui développent ces ressources. Ces « héros méconnus » de l’industrie – les entrepreneurs et les consultants, les chercheurs et les fournisseurs de services – n’ont pas de mine qui porte leur nom, mais leur identité et leur caractère font partie intégrante des exploitations à travers le monde. Chaque exploitation comporte des valeurs à exploiter mais aussi des potentiels cachés qui ne demandent qu’à être harnachés. Dès les premières études, en passant par la construction et le développement de la mine et de l’usine, jusqu’à la fermeture et à la réhabilitation, il est possible d’apprendre de nouvelles choses et d’utiliser de nouveaux outils. « Il y a une dizaine d’années, nous avons analysé l’utilisation des pneus sur les équipements de terrassement », dit Michael Reich, directeur de la formation chez Michelin. « À l’examen des pneus déchets, nous avons trouvé qu’il pouvait rester une bonne partie de la semelle, peu importe la marque. » Michelin a donc réuni des exploitants, des 38 | CIM Magazine | Vol. 4, No. 5

détaillants et des représentants de la compagnie pour trouver des façons de tirer plus de valeur du produit. L’effet a été le plus ressenti lorsque les réserves de pneus ont commencé à diminuer. « Au cours des dernières années, les usagers sont devenus plus réceptifs aux changements, ce qui a permis dans certains cas de doubler la durée de vie des pneus. » « Nous avons retenu de la réunion que la tâche des gens n’est pas de soigner des pneus, c’est de déplacer du matériel. Nous avons donc développé un plan avec chaque client pour améliorer le rendement de ses pneus; six mois plus tard, un représentant effectuait un suivi. » Aucun projet ne peut démarrer sans une solide infrastructure organisationnelle et des relations de travail bien définies. « Si nous embauchons un entrepreneur, il est absolument essentiel qu’il se conforme à nos exigences environnementales, de sécurité et de bien-être de notre main-d’œuvre », explique Ingrid Hann, vice-présidente des ressources humaines, De Beers Canada. Selon Greg Oryall, vice-président du développement des entreprises et des stratégies, AMEC : « Il faut une délimitation très claire des responsabilités afin que des

la force des gens Photo courtoisie de Michelin

points importants, comme la sécurité, ne passent entre les mailles du filet. » Selon Greg Fauquier, directeur général du traitement des minéraux et des métaux pour le Groupe Hatch, chaque engagement avec un client devrait porter fruit. Ce groupe gère l’ingénierie, l’approvisionnement et la construction d’exploitations minières à travers le monde. « Nous avons notre propre programme interne de santé et sécurité qui, dans certains cas, peut être plus exigeant que celui de notre client. » Le mantra de « valeur ajoutée » des consultants est souvent confronté à celui de « couper les coûts » de l’industrie. Selon Mme Hann, le ralentissement économique peut présenter des possibilités de collaboration. « Vous pouvez peut-être prendre le temps de vous assurer que vos processus se déroulent correctement. C’est le temps de régler les contraintes et de faire les travaux de restructuration pour lesquels vous manquiez de temps lorsque vous travailliez à plein régime. » Malgré la volatilité de l’industrie, l’infrastructure de formation demande de la continuité, dit Steve Hall, président-directeur général de MIRARCO (Mining Innovation, Rehabilitation and Applied Research Corporation). Celui-ci coordonne étudiants, chercheurs et industrie afin de perfectionner les capacités de la prochaine génération de professionnels miniers canadiens; il développe aussi les outils dont se servira éventuellement l’industrie. « Cependant, la recherche et le développement prennent du temps. Il faut souvent plusieurs Un ouvrier vérifie la pression d’un pneu années pour établir de l’excellence et elle peut être de leurs employés. Certaines personnes peuvent être perdue si l’infrastructure de soutien est fragile. » L’expansion mondiale du développement des ressources attirées par les conditions offertes par d’autres entreprea initié des projets partout à travers le monde, forçant les neurs ou encore ne veulent pas laisser un endroit de compagnies à être fortes mais aussi à être bien équilibrées travail qu’elles aiment pour un autre chantier détenu par leur employeur. « De tels processus sont l’initiative des et souples. « Si nous travaillons sur un projet en Asie nous pouvons employés », dit Mme Hann. Le maraudage ne constitue faire appel à notre bureau en Chine pour des achats pas de bonnes habitudes d’affaires. Le relâchement du marché du travail signifie souvent locaux, la logistique, la gestion et autres », explique des coupures de personnel. « Nous avons pu acquérir M. Oryall. « Il en est de même pour l’Amérique du Sud. » AMEC travaille sur plusieurs continents. « Nous gérons d’excellentes personnes », dit Sandy Woodhouse, direcpar nos unités d’affaires presque sans tenir compte des trice, ressources humaines, Groupe des mines et des régions », dit M. Fauquier. « Cela nous permet de trans- métaux, AMEC. « C’est un peu une situation sans issue », dit férer des ressources et des connaissances. Si nous travaillions sur une base régionale et que chaque bureau était M. Fauquier. « Notre compagnie possède une bonne base récompensé selon ses profits et sa productivité, aucune technique et elle met l’accent sur les gens qui veulent y division ne voudrait prêter des gens. Lorsque nous travail- faire carrière. Par contre, cela rend nos employés très lons dans un endroit qui n’a pas de main-d’œuvre bien attrayants pour nos clients. Il peut aussi être avantageux établie, alors notre groupe de formation et de développe- pour nos employés de progresser dans leur plan de carment analyse les besoins en formation et aide à les régler, rière. Lorsqu’ils sont rendus chez nos clients, ils nous souvent en formant équipe avec des collèges ou d’autres contactent de nouveau. » Ce sont les gens qui forment le cœur de l’industrie institutions locales. » L’échange d’expertise entre un entrepreneur et le pro- minérale, plus que les machines et les technologies futurpriétaire d’un projet constitue un défi particulier pour les istes. L’industrie les tient en grand estime car elle sait consultants qui passent des années à cultiver les habiletés qu’elle ne peut pas fonctionner sans eux. ICM August 2009 | 39

la force des gens

Cours de renforcement de l’esprit d’équipe au camp Sah Naji Kwe

Bâtir le leadership de l’intérieur Diavik jumèle une gestion de pointe à des approches traditionnelles consacrées par l’usage

a mine de diamants Diavik est située dans la région de North Slave des Territoires du Nord-Ouest, à environ 300 kilomètres au nord de Yellowknife. En 2005, la compagnie a créé le Programme de formation de dirigeants autochtones, inspiré du programme de certificat en gestion appliquée de la Southern Alberta Institute of Technology (SAIT). Le but était d’aider à accroître le nombre d’Autochtones qualifiés pour des postes de gestion et de supervision à la mine. Dès la fin de 2009, le Programme de formation de dirigeants autochtones de Diavik aura une cinquantaine de diplômés. Les participants, des employés de Diavik et des entrepreneurs, auront participé à une série d’ateliers de deux jours et demi, une fois par mois durant un an. Ils auront reçu 188 heures de formation, dont des cours de leadership, participé à un programme de mentorat des gestionnaires de Diavik en plus d’avoir écouté des conférenciers invités. Lorsque la compagnie a décidé d’initier ce programme de développement des 40 | CIM Magazine | Vol. 4, No. 5

employés, elle a invité diverses institutions d’enseignement à soumettre des propositions pour un programme pilote. Parmi les nombreuses options, Diavik a choisi le programme de la SAIT. Les employés qui démontrent un potentiel de leadership sont choisis par leur directeur pour participer au programme. À la fin de la première année, la compagnie a embauché Sarah Wright, une éducatrice autochtone du Nord possédant de l’expérience dans l’industrie pour peaufiner le programme afin de mieux satisfaire les besoins.

Une formation sur mesure « Le programme de la SAIT avait une bonne structure mais nous y avons ajouté des éléments académiques et du contenu spécifique pour les Autochtones du Nord », explique Mme Wright. Par exemple, parmi les aspects académiques, les participants suivent 10 cours dans cinq domaines de gestion appliquée qui rencontrent les besoins de Diavik, dont le comportement organisationnel, les

la force des gens finances et les relations interpersonnelles. Transportés par avion de la mine à leurs cours, les participants reçoivent un cours académique de même qualité que ceux qui suivent le cours à la SAIT. C’est la présentation du cours qui a été adaptée, plutôt que le contenu. Afin de donner au programme un aspect plus local, Mme Wright y incorpore des éléments spirituels et culturels utilisés par les enseignants autochtones dans leurs propres communautés des Territoires du Nord-Ouest. Un exemple est la manière de commencer chaque session. Mme Wright pose une question se rapportant au sujet du cours. « Ainsi, lors d’un cours sur les compétences en Activité de développment de confiance leadership, je demande aux participants de décrire quelqu’un qui les a inspirés. J’utilise le principe d’un cercle de conseil ou de gens à résoudre leurs problèmes. Mon attitude a changé, partage; les participants peuvent alors parler spontané- c’est certain. » M. Laviolette voudrait transférer à la comment. Chaque participant s’exprime et écoute les autres. » munauté ses habiletés acquises. Aaron Campbell, un technicien en traitement des Mme Wright explique qu’il s’agit de l’ancienne démarche minéraux de 24 ans, originalement de Fort Resolution, autochtone pour résoudre des problèmes. D’autres éléments du programme personnalisé traitent travaille chez Diavik depuis trois ans. « Je suis allé voir du bien-être personnel et de la résolution de conflits, de mon directeur; je lui ai dit que ce Programme de formal’équilibre affectif et de la nécessité de prendre du temps tion de dirigeants autochtones m’intéressait et il a pour soi. « Nous avons restructuré un des cours pour y accepté que j’y participe. » M. Campbell dit que les cours incorporer le point de vue autochtone que l’équilibre de résolution de conflits l’ont aidé à interagir plus effimental, physique et spirituel est essentiel pour devenir un cacement dans diverses situations de travail. D’autres chef efficace. » Mme Wright invite un guérisseur tradi- cours l’ont aidé à gérer ses finances et à avoir de l’emtionnel pour donner un atelier d’une demi-journée. pathie pour les autres. « Je connais mieux les autres et « Nous avons travaillé avec un cercle d’influences des ce qu’ils ont vécu et je me sens plus membre d’une Dénés pour expliquer que le leadership ne concerne pas grande famille. » qu’une seule personne. Différentes personnes ont différents talents ou dons. Nous faisons valoir qu’il y a un Ramener la formation chez soi Selon Mme Wright, avec la croissance économique leader dans chacun d’entre nous. Chacun de nous a un don et c’est l’occasion de le reconnaître et de s’en servir dans le Nord, les solutions pour le développement durable pour apporter sa contribution sur les lieux de travail et à long terme devront intégrer les connaissances locales. Ses années d’expérience et de travail en Asie et en dans la communauté. » Amérique centrale lui ont fait comprendre la puissance De l’individu à la communauté d’une expérience globale. Rob Laviolette a terminé le Programme de formation « Mon intention est d’alterner entre le local et global de dirigeants autochtones en janvier 2009. Soudeur à afin de prendre conscience des questions indigènes Diavik depuis 2003, il a 31 ans et il est père de trois autour du monde », explique-t-elle. Elle ajoute que son but enfants. Même s’il ne savait pas trop à quoi s’attendre au est d’habiliter les Peuples autochtones à prendre en main début, il a beaucoup appris sur lui-même et ses col- leur propre destinée. « J’encourage les étudiants à être lègues. C’est la session sur la constitution d’équipes qui responsables. Lorsque nous voyons les défis des peuples l’a surtout marqué. opprimés ailleurs et la puissance d’une résolution de prob« Apprendre à guider les gens et à les aider à résoudre lèmes pro-active, nous nous sentons obligés de moins leurs problèmes m’a beaucoup appris sur le plan personnel », nous apitoyer sur nous-mêmes et plutôt de nous demanexplique-t-il. « Je n’avais pas beaucoup de patience et je der ce que nous pouvons faire. » ICM voulais mieux interagir avec les gens. Je me suis amélioré. J’ai été capable de désamorcer des situations et aider des www.diavik.ca August 2009 | 41

featured mines

Aerial view of the Kittilä mine site

Going for gold Agnico-Eagle’s Kittilä mine feels like home by | Mike Paduada

High up in the Arctic region of northern Europe, a Canadian company is building what could become the continent’s largest gold mine. From the terrain and the weather to people’s proclivities, common bonds are uniting the company with its hosts. Together, they are learning as much about one another as about mining under the midnight sun.

Nestled among hills, marshes, lakes and rivers, a new gold mine has opened in Finland and a lot of people are talking about it. The mine is situated in the Central Lapland Greenstone Belt, and geologists are discussing its similarities to the Abitibi. Its Arctic location has mining engineers deliberating 42 | CIM Magazine | Vol. 4, No. 5

about how to deal with frigid winters and months of 24-hour daylight and 24-hour darkness. The refractory nature of the ore has metallurgists conferring about the mill flowsheet and optimizing recovery. The tight credit markets have analysts wondering how it got funded. Still others are

featured mines speaking about the production schedule, reserve conversion, safety, language, the environment, Finnish political views and innumerable other topics. But when Agnico-Eagle brought all of these people together at the official opening of their Kittilä mine, the one topic that everyone was talking about was the people.

The power of people People — specific individuals and local Finnish residents — played key roles in the story of the Kittilä mine. The mine is built on the Suurikuusikko gold deposit, the largest in northern Europe. It was discovered by geologists from the Geological Survey of Finland in 1986. Riddarhyttan Resources’ founders Jaan Kaber and Sven Norfeldt, seeing the potential for a gold mine, acquired the deposits from the Finnish government in 1998. Riddarhyttan’s board and chairman, Pertti Voutilainen, soon realized that they needed to bring in a mining company that had the skills and funding to make it happen. The support from people in the community really encouraged Agnico-Eagle to make a commitment, explained AgnicoEagle CEO and vice-chairman Sean Boyd. “One of the people we first met early on was Seppo Maula [mayor of the municipality of Kittilä], and his enthusiasm was infectious,” said Boyd. “Without Seppo and without the support of the local community, the local government and the government of Finland, this wouldn’t have happened.” Reciprocally, Agnico-Eagle’s own culture helped it find favour among the Finnish people. Dmitry Kushnir, manager of investor relations, who started at Agnico-Eagle in January 2009, noted of its corporate culture: “The way employees are treated makes for a great working environment. I see how the senior management deals with people, how open they are with investors and anybody who is interested. They provide so much transparency. People realize this is something they can put their names and their confidence behind.” Nearly everyone at the official opening who was not from Agnico-Eagle appreciated the company’s palpable attitude, confidence and pride. Making a connection with the local community was crucial to the decision to expand to Finland, according to AgnicoEagle chairman James Nasso. That connection was easy to find, given the obvious similarities between Finnish and Canadian culture. Nasso recalled Senior Canadian Trade Commissioner Stephen Chase remarking of Finland: “It’s just like being home.”

“Truly, that’s the way we all feel here,” Nasso said. “From the landscape to the people, Finland resembles us in many ways. We first look for places where we would feel at home. Then, if we get the right geology and the opportunities to build mines, we want to be there for many decades.” The connection made, it took a dedicated effort from Agnico-Eagle employees to get Kittilä started. Eberhard Scherkus, president and COO, and Alain Blackburn, senior vicepresident, exploration, led many site visits to direct drilling and assess potential. Perrti Voutilainen, who became an independent director of Agnico-Eagle in 2005, and Ingmar Haga, who was appointed Agnico-Eagle’s vice-president, Europe, in 2006, had brought and continue to bring first-hand insight of the Finnish mining industry. David Garofalo, Agnico-Eagle’s CFO and senior vice-president, finance, secured financing for the company’s ambitious expansion, a feat that contributed to his being named Canada’s CFO of the Year for 2009.

We are proud to have supported Agnico Eagle in the Kittila Project

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featured mines 1

44 | CIM Magazine | Vol. 4, No. 5

featured mines If you build it, they will come It takes people to build a mine and ensure that it runs smoothly. Although mining is a crucial part of the economy, Finnish mining experience to date has been primarily underground. Mine superintendent Juha Riikonen explained: “I’m a mining engineer. I’ve worked for 30 years, but mostly in underground mines. I do not have very much open pit experience. It is the same with almost everybody. Over the last six months we hired almost 70 people, some with no open pit experience.” Since the first few years of Kittilä’s production will come from open pit operations, training is critical in getting Kittilä production up to design specifications. “The training here has been fantastic,” said Bruce Schellenberg, a Canadian training advisor who has been flying in and out of Kittilä. “They have come a long way in a short time and have overcome a lot of obstacles dealing with the adverse weather conditions, getting into the working process and understanding what a 24-hour operation involves.” The current mining rate in the 150-metre-deep Suuri pit is approximately 2,500 tonnes of ore per day. It is expected to achieve the design rate of 3,000 tonnes per day by the third quarter of 2009. On-site equipment includes seven Caterpillar 777s, two Ranger 700 drill rigs, one Atlas Copco ROC D9 surface drill rig, three Caterpillar 385 excavators and two Caterpillar D6/8 bulldozers. The mined ore is refractory, containing both sulphides and organic carbon. The majority of the gold is found in the lattices of arsenopyrite (73 per cent) and arsenian-pyrite (23 per cent), while the remaining gold occurs as very fine free grains in the hydrothermally altered rock. Most of the mill circuits, already familiar to Agnico-Eagle from their other operations, are operating at or near design parameters. The flowsheet begins with a jaw crusher which discharges crushed ore to a 3,000-tonne surge bin, which delivers material to the semi-autogenous grinding (SAG) mill. The 9.2-metre-long, 5.5-metre-wide SAG mill, driven by a 4,400 kWh motor, processes 124 tonnes per hour, on average. In the flotation circuit of nine Outotec Tankcell-40 cells, a carbon flotation stage that removes organic carbon is followed by a sulphur flotation stage that produces sulphide concentrate. The addition of sulphuric acid in an acidulation step prepares the concentrate for pressure oxidation in the autoclave. The autoclave is new to Agnico-Eagle, so the Finnish are not the only ones learning things at Kittilä. Pressure oxidation

Photos, opposite page: 1. SAG mill; 2. Kittilä ore being fed to the mill; 3. control room at the mill; 4. excavation at the open pit; 5. leaching tank; 6. first gold pour at Kittilä. All photos courtesy of Angico-Eagle.

Agnico-Eagle CEO Sean Boyd and investors

in the autoclave was the method chosen for dealing with the refractory ore. Two recently identified metallurgical issues are the formation of a gold chloride compound and the activation of organic material in the autoclave. As Agnico-Eagle personnel collaborate to find optimal adjustments such as pre-flotation of organic carbon, autoclave residence time, temperature and acid levels, they are pushing towards design recoveries of 83 per cent and the accumulation of shared expertise. The product from the autoclave is thickened in a threestage counter-current decantation (CCD) circuit. Next, liberated gold is absorbed onto activated carbon in the six-tank carbon-in-leach (CIL) circuit. Finally, the gold is recovered by electrowinning and poured into dore bars in the on-site refinery.

The best is yet to come Kittilä’s 3.2 million ounces of reserves already represent a significant portion of Agnico-Eagle’s 18.1 million ounces of proven and probable gold reserves. An aggressive 67.5-kilometre exploration campaign, along with a study to look at doubling the production rate, may make it even more impressive. When you’re working in a place that feels like home, longterm connections are formed. “With the exception of the language, living in Lapland is much like living in northern Canada,” said Kittilä mine manager, Carol Plummer. “The lakes, trees and climate are very similar to the Abitibi. The people love fishing, hunting and spending time outdoors especially at this time of year with the midnight sun.” Throughout the day, both Canadians and Finns acknowledged their common love for hockey and speculated on a Canada versus Finland final game at the upcoming Vancouver 2010 Winter Olympics. Perhaps mining is just like hockey — if you know your game and you build the right team, you’re going to get the gold. CIM www.agnico-eagle.com August 2009 | 45

Photo courtesy of Agnico-Eagle Mines

featured mines

LaRonde mine Penna shaft headframe

The Midas touch Agnico-Eagle’s LaRonde mine extension by | Peter Diekmeyer

Undertaking a CDN$337 million expansion inside an operating mine poses a few technological challenges. However, with engineering ingenuity, employee commitment and a top-notch supplier network, Agnico-Eagle’s LaRonde mine extension is set to make one of Canada’s largest underground operating gold mines even bigger.

When you have what mining sector veterans call a “company maker” among your holdings, you want to keep it in operation for as long as possible. Agnico-Eagle Mines obtained such a property when it acquired the Dumagami open pit and underground mine in 1988. So it came as no surprise several years ago when the company announced that the LaRonde mine (as the new property was later named) would be expanded. 46 | CIM Magazine | Vol. 4, No. 5

The LaRonde initiative, which will include an upgrade of the mill facilities, is expected to cost CDN$337 million, and represents a major investment for Agnico-Eagle. However, the money being spent is expected to yield significant longterm benefits. Ore extraction from the extension shaft currently being dug is expected to start by 2011. When ancillary facilities are completed, the combined LaRonde operation is expected to yield an average of about 320,000 ounces of

featured mines gold per year and will extend the mine’s useful life through to at least 2022.

LaRonde: a “company maker” “LaRonde is one of Canada’s largest underground operating gold mines,” said Christian Provencher, the site’s general manager. “Extraction has continued at a steady and reliable pace for the last six years at more than 7,000 tonnes per day. Furthermore, the sinking of the extension shaft is almost complete and the project is proceeding both on schedule and on budget.” The LaRonde mine is located in northwestern Quebec, near the villages of Preissac and Cadillac, in the southern portion of the Archaean-age Abitibi volcanic belt, within the Bousquet Formation of the Blake River volcanic group. According to Agnico-Eagle, the geology is east-west trending, steeply southward dipping and generally southward facing. As of the end of 2008, all of the mineral reserves and most of the mineral resources at LaRonde were located near the Penna shaft. These reserves and resources occur as several sulphide-rich lenses, which are found along five different Project5:Layout 1 10/23/08 10:38 AM Page 1 stratigraphic horizons. The company currently uses two main mining methods at the LaRonde site, depending on the thickness of mineralized

zones. The first is longitudinal retreat in 15-metre sections and the second is transverse open stoping. The property has already yielded more than three million ounces of gold and holds approximately another five million ounces of proven and probable reserves. These are comprised of 35.8 million tonnes of ore with an average grade of 4.3 grams per tonne. Much of the production equipment at the site, including 17 load haul dumpers, is supplied by Sandvik Tamrock. The other good news regarding ore from the LaRonde property is that it is fairly inexpensive to extract and process — which makes it an investor’s dream. During the first quarter of 2009, mine site costs were approximately CDN$72 per tonne and total cash costs were US$294 per ounce (net of by products), meaning that LaRonde is likely one of the lowest cost gold mines in the country.

The LaRonde extension According to Provencher, excavation work on the new extension began in 2006. Project design was handled by Agnico-Eagle technical services and detailed engineering by the Genivar group. During the first three months of this year, a further 120 metres were bored onto the new internal shaft that, by the end of the quarter, had been dug down to a depth of 2,630 meters, just 250 meters shy of its planned 2,880

August 2009 | 47

The first station winze at 2570 meters below surface

featured mines meter depth. “What makes the work being done so far particularly challenging, is that it is being done inside a mine that is already operating,” explained Provencher. “Since the mine only has one operating shaft and accessory ramp, this has the potential to create a lot of bottlenecks.” Parallel to the main shaft, workers are excavating a down ramp and building ventilation and other key infrastructure. Three underground hoists are also being installed, with many of their components being supplied by Davy Markham. “When it is completed, we will have access to one of the deepest internal shafts in North America, almost three kilometres below surface” said Provencher. “It’s a construction challenge to build a mine in a mine, as there are technical and logistical issues.”

Photo courtesy of Agnico-Eagle Mines

The human element

48 | CIM Magazine | Vol. 4, No. 5

Although Agnico-Eagle’s properties are what attract attention to the company, its people and the way they are managed are an often-underrated asset, according to Provencher. For example, close to 700 direct employees work at the LaRonde site. Anecdotal evidence (in particular, the long lineup of job-applicants at its doors) coupled with the fact that employees have remained non-unionized, signal that AgnicoEagle’s labour relations are excellent. According to Provencher, one key reason for the high degree of job satisfaction, which dates back to the site’s opening, is a 17-person collaboration committee that he chairs, which deals with employee management issues at the site. The committee — which includes the human resources superintendent, plus operations managers, as well as ten employees — also provides an invaluable forum whereby company personnel can convey candid feedback and suggestions regarding issues ranging from productivity enhancements to safety concerns. The company’s non-union status also provides both Agnico-Eagle and its employees other benefits, claimed Provencher, though not the sort that some would assume. “Our employees’ salaries are at the same level as those in the rest of the mining industry,” he explained. “Where we really gain is from the enhanced flexibility and cooperation we get. For example, we recently offered our employees the option of transferring from LaRonde to our Goldex and Lapa operations, and we will do the same thing for our Meadowbank open pit project in Nunavut. Several employees took us up on the offer.” In the

Photo courtesy of Agnico-Eagle Mines

The production hoist winze

absence of a formal union, annual contract negotiations are handled by an employee committee. According to Provencher, another key benefit that mine workers get is substantial advantages when purchasing company shares. More than 90 per cent of the employees participate in the share purchase plan. Furthermore, unlike many stock sale programs, which require employees to hold onto shares bought at a discount for a minimum period, the LaRonde plan sets no such limits. “Of course, we prefer it when our employees own stock, because that generally makes them more committed stakeholders,” said Provencher. “But they are free to do what they like with their shares.”

A broad and high-level supplier network Another of the LaRonde operation’s big intangible assets is its top-notch supplier network. “Our region includes many mines, so there are a lot of companies around here that have built up a good knowledge of the industry,” declared Provencher. For example Beroma, a Val-d’Or-based company, is supplying much of the steel being used in the current mine expansion, and Fournier et Fils is providing most of the concrete. Dumas Contracting, which is doing the shaft sinking for the extension, has 65 people working on the LaRonde site and C-Mac/Thyssen, which handles excavation for the extension’s ventilation network, has another 40 people working there. In fact, according to Provencher, the almost 150 contract workers of all sorts who are working at the LaRonde site — from drillers to maintenance and supply personnel — deserve a big chunk of the credit for the extension project’s success so far. As if all of the good news surrounding the LaRonde site and its extension project were not enough, Agnico-Eagle is far from done. Exploration at the site continues and is now focused on possible additional potential at deeper levels and in areas east of the present development. CIM www.agnico-eagle.com

mines en vedette Réservoir de lixiviation à la mine Kittilä

La mine Kittilä d’Agnico-Eagle

Une nouvelle mine d’or en Finlande attire beaucoup d’attention. Les géologues parlent de la similitude du gisement avec ceux de l’Abitibi; les ingénieurs miniers pensent aux conditions difficiles et les métallurgistes discutent du minerai réfractaire, du circuit de traitement et de l’optimisation de la récupération. Le gisement aurifère de Suurikuusikko a été découvert en 1986; les fondateurs de Riddarhyttan Resources, Jaan Kaber et Sven Norfeldt, l’ont acquis par la suite et le président de la compagnie, Pertti Voutilainen, a vite réalisé qu’il fallait une compagnie minière d’expérience pour l’exploiter. Le soutien de la communauté a encouragé Agnico-Eagle à s’engager, explique Sean Boyd, président-directeur général, Agnico-Eagle. En retour, la culture organisationnelle de cette compagnie a impressionné les Finlandais. « La façon de traiter les employés conduit à un bon environnement de travail », dit Dmitry Kushnir, directeur des relations avec les investisseurs. Selon James Nasso, président, Agnico-Eagle, les liens étaient faciles à établir en raison des similitudes entre les cultures finlandaise et canadienne. Les employés d’Agnico-Eagle se sont beaucoup impliqués pour démarrer Kittilä. Eberhard Scherkus, président et chef des opérations, et Alain Blackburn, vice-président principal, exploration, ont souvent visité le site pour diriger les forages et évaluer le potentiel. David Garofalo, chef des services financiers et vice-président principal d’Agnico-Eagle, a obtenu le financement pour l’agrandissement de la compagnie, un fait qui lui a mérité le titre de meilleur directeur financier au Canada pour l’année 2009. Bien que l’exploitation minière constitue une part importante de l’économie de la Finlande, l’expérience de ce pays réside surtout dans les mines souterraines; c’est aussi le cas du surintendant de la mine, Juha Riikonen. « Au cours des six derniers mois nous avons embauché près de 70 personnes et peu connaissent les exploitations à ciel ouvert. » La formation sera donc essentielle. Selon Bruce Schellenberg, un conseiller canadien en formation, les gens ont rapidement 50 | CIM Magazine | Vol. 4, No. 5

surmonté de nombreux obstacles dont le climat et le fonctionnement 24/7 d’une exploitation. Le taux actuel d’extraction dans la fosse Suuri est d’environ 2500 t/j et il devrait atteindre 3000 t/j vers la fin de 2009. L’équipement d’extraction comprend des camions Caterpillar, des appareils de forage Ranger 700 et une foreuse Atlas Copco ROC D9 en plus des pelles et des bouteurs. Le circuit de l’usine est semblable à d’autres circuits AgnicoEagle : un concasseur à mâchoires, un réservoir intermédiaire de 3000 tonnes et un broyeur semi-autogène qui peut traiter en moyenne 124 t/h. Dans le circuit de flottation, neuf cellules Outotec Tankcell-40, retirent le carbone; un stage de flottation des sulfures produit un concentré de sulfure. L’ajout d’acide sulfurique prépare le concentré pour une oxydation sous pression dans l’autoclave. Le personnel d’Agnico-Eagle optimise les derniers ajustements : la pré-flottation du carbone organique, le temps de résidence dans l’autoclave, la température et le niveau d’acidité pour une récupération visée de 83 pour cent. Le produit de l’autoclave est épaissi dans un circuit de décantation à circulation inverse à trois étapes, puis l’or est adsorbé sur du charbon activé dans un circuit de lixiviation sur charbon. Finalement, l’or est récupéré par extraction électrolytique et coulé en lingots.

Le meilleur est encore à venir Les 3,2 millions d’onces de réserves, la campagne d’exploration sur 67,5 km2 et une étude pour doubler le taux de production rendent la mine Kittilä encore plus intéressante. « À l’exception de la langue, la vie en Laponie ressemble au Nord du Canada », dit, Carol Plummer, le directeur de la mine. De plus, les Canadiens et les Finlandais partagent un amour du hockey et discutent des chances d’une finale Canada – Finlande lors des Jeux d’hiver de Vancouver. Les mines, c’est un peu comme le hockey, il faut connaître son jeu et avoir la bonne équipe pour rapporter l’or. ICM

mines en vedette

L’expansion de la mine LaRonde d’Agnico-Eagle La compagnie Agnico-Eagle a Les gens et la gestion du personnel obtenu une propriété « gagnante » constituent souvent un actif souslorsqu’elle a acquis la mine Dumagami évalué. Les nombreux postulants pour en 1988, depuis renommée mine les emplois et le fait que les employés LaRonde. ne sont pas syndiqués en disent long L’initiative LaRonde, comprenant un sur les relations de travail chez Agnicoagrandissement de l’usine, devrait Eagle. coûter 337 M$. Lorsque les installaSelon M. Provencher, une raison clé tions secondaires seront terminées, la pour le niveau élevé de satisfaction au mine LaRonde produira une moyenne travail est le comité de collaboration d’environ 320 000 onces d’or par qui traite des questions de gestion du année; sa durée de vie serait aussi personnel. Ce comité, dont il est le prolongée au moins jusqu’en 2022. président, comprend le surintendant Cette mine est située dans le norddes ressources humaines, cinq ouest du Québec, dans la portion sud directeurs d’usine et d’opérations de la ceinture volcanique de l’Abitibi, à souterraines et douze employés; il l’intérieur de la Formation de Bousquet constitue aussi un excellent forum du Groupe de Blake River. La géologie a pour les questions d’amélioration de la une direction est-ouest, à pendage productivité et les enjeux de sécurité. abrupt vers le sud. Les réserves et les Le statut non syndiqué fournit ressources se présentent sous forme de aussi d’autres bénéfices inattendus. Puits borgne de la mine LaRonde lentilles riches en sulfures dans cinq « Les salaires de nos employés sont horizons stratigraphiques différents. semblables à ceux d’employés synSelon l’épaisseur des zones minéralisées, l’extraction se fait diqués. Nous gagnons cependant beaucoup en flexibilité : par retrait longitudinal dans les sections de moins de 15 nous avons offert à nos employés de transférer de LaRonde à mètres ou par chambre vide. La propriété a déjà produit plus Goldex ou Lapa et nous ferons de même pour nos mines à ciel de trois millions d’onces d’or et détient environ cinq millions ouvert au Nunavut. » En l’absence d’un syndicat formel, un d’onces d’or en réserves prouvées et probables. De plus, le comité d’employés est chargé des négociations contractuelles minerai est assez peu cher à extraire et à traiter. Pour le pre- annuelles. mier trimestre de 2009, les coûts au site minier étaient d’enLes travailleurs peuvent aussi acheter des actions de la viron 72 $/t et les coûts effectifs de production étaient de compagnie à rabais; ces achats ne comportent pas de 294 $/once. clause qui les oblige à garder leurs actions pour un temps Les travaux d’excavation pour l’extension, conçue par le minimum déterminé. « Évidemment, nous aimons que nos groupe de génie-conseil Genivar, ont débuté en 2006. À la fin employés conservent leurs actions, car ils deviennent alors du premier trimestre de l’année, le puits interne avait été des intervenants engagés, mais ils sont libres d’en faire ce creusé tout juste à 250 mètres de la profondeur planifiée de qu’ils veulent. » 2 880 mètres. « C’est un peu compliqué puisque le travail se LaRonde possède aussi un réseau de fournisseurs de première fait à l’intérieur d’une mine en exploitation », explique classe. « Notre région comporte plusieurs mines; les compaM. Provencher, le directeur général du site. gnies locales connaissent donc bien l’industrie minière », Les travailleurs excavent aussi une rampe et installent la dit M. Provencher. Par exemple, Beroma fournit une grande ventilation et trois treuils souterrains dont les composantes partie de l’acier utilisé dans l’agrandissement; Fournier et Fils sont fournies par Davy Markham. « Lorsque le tout sera com- fournit le béton; l’entrepreneur Dumas, qui creuse le puits pour plété, nous aurons l’un des puits des plus profonds en l’extension, a 65 personnes sur le site et C-Mac, qui s’occupe de Amérique du Nord. La construction comprend donc de nom- la ventilation, en a 40. ICM breux éléments de sécurité tels que des freins magnétiques et des sorties de secours secondaires », dit M. Provencher. www.agnico-eagle.com August 2009 | 51

supply side The importance of advertising in tough times z Jon Baird

Since 1906, American Business Media — the U.S. association of business information providers — has been delivering business intelligence to industry, Madison Avenue, Wall Street and the Beltway. Its 350plus member companies reach an audience of more than 100 million professionals, and represent nearly 6,000 print and online titles, 1,000 trade shows and well over $33 billion in annual revenues. ABM has recently produced a PowerPoint presentation entitled “The Importance and Value of Advertising During Times of Economic Uncertainty.” The presentation summarizes the wealth of data that has been accumulated over time, clearly demonstrating that companies who either continued or aggressively increased their advertising during tough times experienced overall growth as well as continual growth past the period of economic uncertainty. A survey of 162 business-to-business marketers in October 2008 demonstrated that marketers understand the importance of advertising in hard times. While 30 per cent of respondents expected to decrease

52 | CIM Magazine | Vol. 4, No. 5

their budgets, 40 per cent would retain the same budgets and 30 per cent would increase their spending. Queried on their medium of choice for their largest budget increases, 49 per cent of those planning to increase advertising named online advertising, 17 per cent said direct mail, 14 per cent said events (such as trade shows) and 9 per cent said print. Even in a depressed economy, more than 95 per cent of executives maintain a high interest in learning about and investing in new products or services. Of the same audience, 86 per cent agree that when a company advertises in a troubled economy, they feel more positive about that company’s commitment to its products or services and it keeps those companies top-of-mind when purchases are to be made. One study that analyzed the performance of more than 600 businessto-business firms concluded that those that maintained or increased their advertising expenditures averaged significantly higher sales growth during and for three years following the recession, compared to those that eliminated or decreased advertising.

A page for and about the supply side of the Canadian mining industry

The presentation concluded by saying: “Advertising aggressively in a recession can not only boost sales and market share, it can also open a lead on the more timid competition. It can skilfully reposition a product to take advantage of new purchasing concerns, give the image of corporate stability within a chaotic business environment, and give an advertiser the chance to dominate the advertising media.” The full presentation is available at www.americanbusinessmedia.com CIM www.camese.org

About the author Jon Baird, managing director of CAMESE and president of PDAC, is interested in collective approaches to enhancing the Canadian brand in the world of mining.

eye on business Bill C-300 threatens Canada’s international extractive sector z Michael Bourassa, with the assistance of Charles Todd Comprising five per cent of our total GDP, Canada’s extractive industries have led the charge during a decade of unprecedented economic growth in Canada. They continue to remain a fundamental component of our output, even through current challenging economic times. Globally, Canada is a recognized leader in exploration, extraction, research and development, and especially financing. Toronto is the world’s leading city for mining finance and Vancouver is home to the world’s largest cluster of exploration companies. As of 2008, over three-quarters of the world’s exploration and mining companies called Canada home. It is not surprising, then, that Canadian companies are developing many lucrative mineral, oil and gas deposits around the world and generating much-needed economic growth in scores of developing countries. But these success stories, along with many still waiting to be told in some of the world’s poorest regions, are now jeopardized by a Private Member’s Bill that has passed second reading in the House of Commons and, as of June 2009, is being considered by the House Standing Committee on Foreign Affairs and International Development. Bill C-300 (An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas Corporations in Developing Countries), sponsored by Scarborough MP John McKay, is based on the false premise that Canadian mining activities abroad are inconsistent with international social and environmental best practices and with Canada’s commitments to human rights. In reality, however, Canada is recognized internationally as a global leader in corporate social responsibility (CSR) and its companies are preferred investors all over the world. In recent years, the Canadian extractive sector has, in collaboration with host countries and other

stakeholders, raised environmental and community standards and shared best practices in a number of important fields. Unfortunately, the numerous serious issues with the Bill may have the absurd effect of stalling or even reversing that progress. Chief among the problems raised by the Bill is Canada’s capacity, expertise or jurisdiction to enforce CSR guidelines abroad or to supersede local authorities, which is why no other country in the world has legislation like C-300 in place. Trust in Canadian industry by host countries and local communities relies upon mutual respect regarding their respective legal systems and social and environmental standards. The Bill’s passage would immediately undermine that trust, severely disadvantaging Canadian companies and creating a strong incentive for them to move jurisdictions. The Bill also effectively pre-empts the Canadian government’s own comprehensive CSR Strategy for the International Extractive Sector. Released in March 2009, the strategy was a response to the Advisory Group Report on the National Roundtables on CSR and the Extractive Industry in Developing Countries. The government’s CSR strategy has three key components: i) social responsibility, ii) environmental stewardship, and iii) health and safety. It begins with the premise that the Canadian mining industry has excelled globally in the area of CSR and its existing advantages should be fostered and strengthened. The government’s CSR strategy represents the culmination of three years of consultations among experts and stakeholders from a variety of fields. These include foreign policy, the environment, industry, human rights and sustainable development. The authors of Bill C-300, however, failed to

undertake any consultation whatsoever with industry, or domestic or foreign government officials. The government’s CSR strategy recognizes that investments in aid of local education, training, health, safety, security, productive development and infrastructure now routinely feature prominently in Canadian companies’ development plans for mines abroad, and it seeks to assist with and expand those initiatives. Conversely, Bill C-300 assumes that the Canadian international extractive industry is harming local communities and seeks to punish it. In a best case scenario, the adoption of Bill C-300 will create a duplication of many aspects of CSR work already performed more competently through existing organizations. In a worst case scenario, it establishes a punitive approach to social responsibility and risks setting the mining industry back by many years in terms of its environmental sustainability, diplomatic, community and social responsibility achievements to date. The fact that Bill C-300 was even introduced should be a wake-up call for all of us involved in the extractive industry. Our communities and our elected officials do not know the whole story about resource extraction, so we need to be vigilant in conveying to them the positive aspects of our work and the successes of our industry. CIM www.fasken.com

About the author Michael Bourassa is the co-ordinator of the Global Mining Group at Fasken Martineau. He provides advice to Canadian and international exploration and mining companies on commercial and regulatory matters. August 2009 | 53

MAC economic commentary Canada’s trade and investment policy priorities z Paul Stothart

The mining industry ranks alongside financial services and oil and gas as the most international of Canada’s industry sectors. To cite a few statistics, the mining industry accounts for 19 per cent of all Canadian goods exports. Some 12 per cent of Canada’s stock of direct investment abroad is accounted for by the mining sector, as is almost nine per cent of inward direct investment. Three-quarters of the world’s mining equity financings are handled through the Toronto Stock Exchange. Some 60 per cent of the world’s mineral exploration companies are Canadian and they have operated in around 100 countries. Billions of dollars worth of annual export revenues are derived from each of iron and steel, aluminum, nickel, copper, gold, uranium, coal, potash, zinc, diamonds and iron ore. This international success reflects our country’s geological strengths and long mining history — evidenced in national institutions such as the Geological Survey of Canada — as well as the entrepreneurial and technological skills of the industry’s workers. However, this success also draws upon an extensive network of government support delivered through Canada’s trade “infrastructure” — comprising the overseas embassies and trade commissioner network, trade finance capacity through Export Development Canada, and an array of free-trade agreements (FTAs) and foreign investment protection agreements (FIPAs), among many other components. Developments and improvements with respect to this trade infrastructure, such as those highlighted in early June during International Trade Day in Ottawa, are important to the industry and worth noting. In recent years, the federal government has adopted a particularly ambitious agenda in modernizing and broadening this infrastructure. In the 54 | CIM Magazine | Vol. 4, No. 5

area of FIPAs, the government aims to double the number of agreements in place, from 23 to 46, over a five-year period. FIPAs are bilateral agreements that place investment-treatment obligations on each country and that provide foreign investors with access to independent rules and arbitrators should disputes arise between the investor and government. These mechanisms can provide Canada’s overseas investors with an added layer of security and, while the actual enforcement components are rarely used, the mere existence of a FIPA helps guide foreign governments with a set of rules and expectations of fairness and transparency. FIPAs with India, Jordan, Madagascar, Kuwait and five new EU states have recently been concluded by the federal government, while negotiations with China, Indonesia, Mongolia, Poland, Tanzania, Vietnam, Bahrain and Tunisia are ongoing. In some of these cases, the mining industry is the main impetus for the launch of negotiations. As well, negotiations with Malaysia, Kazakhstan, Ghana, Rwanda, Nigeria, Mali, Cameroon, Zambia, Botswana, UAE, Saudi Arabia and Cuba are being explored. In the broader area of free trade agreements, the government announced in early May that Canada and the European Union had launched negotiations towards a comprehensive economic agreement. This extensive undertaking will face many challenges in meeting the targeted two-year negotiation timeframe. In terms of ongoing FTA files, a free trade agreement with the four European Free Trade Area countries will come into force in July 2009; a Jordan FTA should be signed later in 2009; agreements with Peru and Colombia have been concluded (the Peru legislation

is moving through Parliament, while the Colombia FTA will likely move more slowly); and negotiations with Panama, the 15 Caribbean members of CARICOM, four Central American countries, Morocco, South Korea and Singapore are in progress, with varying degrees of commitment. Negotiations with India and Japan are being explored, though these require analysis and approval before potentially moving to a more formal stage. Successfully concluded free trade agreements can help mining companies by lowering the cost of imported machinery, minimizing technical barriers to trade, enhancing the security of overseas investments, improving regulatory cooperation and facilitating easier cross-border movement, among other positive impacts. MAC is actively engaged in dialogue with the federal government on a range of international trade and investment issues and will continue to be involved in files such as the Canada-EU negotiations as they evolve over the coming years. Other trade-related items, such as progress in multilateral WTO Doha Round negotiations and the implementation of a policy response on the international corporate social responsibility issue will also be monitored closely by MAC, with interventions being made as appropriate. CIM For more information on this subject, readers may contact the author at pstothart@mining.ca.

About the author Paul Stothart is vice president, economic affairs of the Mining Association of Canada. He is responsible for advancing the industry’s interests regarding federal tax, trade, investment, transport and energy issues.

first nations The HR challenge in Aboriginal territories z Juan Carlos Reyes

Given that Aboriginal communities have the fastest growing youth demographic in Canada and that most new exploration and mining developments are near Aboriginal communities, it makes sense for the shortage of workers in the mining industry to be offset by the recruitment of these youth. But the reality seems to be quite different. Far too few Aboriginal youth are entering the mining industry. Unless we do something about it, this trend will continue and they will continue to be under-represented in the industry. Most of us are familiar with the concept of a ghost town — a community that has been virtually aban- Young protester at rally for new school in Attawapiskat doned by human inhabitants — mainstream employment world is usually because of the failure of ecotherefore very steep. nomic activities that supported the Perhaps the biggest challenge is the town. Due to the cyclical nature of the negligence of the government towards minerals industry and the fact that its duty of providing proper education mining exploits non-renewable to Aboriginal communities. A particuresources, mines are notorious for larly frustrating example of this is the leaving ghost towns in their wake. development (or rather, the nonWhy is this relevant to this article? It is because most First Nations communi- development) of the elementary school in the Attawapiskat First ties would be ghost towns without Nation. Here is a community that has government assistance provided to abundant potential employment for support the membership. their youth as long as they can get eduMost remote First Nations have cated. But they can’t get that education an extraordinarily high unemploybecause they lack appropriate schoolment rate — some even as high as 90 ing facilities. per cent. Although there are many Back in 1979, a large diesel spill candidates for potential work, there contaminated the land under the is no industry to provide the muchneeded employment. Community school in Attawapiskat. Since then, teachers, students and other employmembers are trapped in these virtual ees have chronically ghost towns with no potential or suffered from severe hope for change. But even if an headaches and nau“employment fairy” was to appear in such a community and magically sea. The community has been promised a create opportunity for everyone, this school by the last would not solve the problem. There three Indian Affairs are generations of potential employministers. ees who have not acquired the basic In August 2007, skills that are expected of today’s Minister Jim Prentice workers. For most Aboriginal peoand the community ple, the integration curve into the

approved the final draft of the plans for the new school. Construction was to begin in the spring of 2008. But in December 2007, the new minister, Chuck Strahl, cancelled the plans, stating that “there were other communities that took priority and that there were no health and safety concerns in Attawapiskat.” As far as the integration of Aboriginal youth into the productive workforce is concerned, such delays on the part of the government in discharging its duty only make matters worse. The pieces to form the solution to the problems of Aboriginal unemployment and the mining industry human resources shortage appear to fit together easily. The mining industry and the Aboriginal communities are themselves the solution to one another’s problems. However, when you take a closer look at the challenges that exist, the pieces do not fit quite so easily. The solution requires mutual understanding and collaboration, and, most importantly, a realistic implementation plan. Case studies show that many companies have successfully integrated a high percentage of Aboriginal employment into their operations and have learned how to do it well. In the next article, I plan to take a more in-depth look at one of those success stories to demonstrate how even small exploration companies have had great success with a very limited budget. CIM www.carlosreyes.ca

About the author Juan Carlos Reyes is an aboriginal consultant with efficiency.ca and the organizer of Learning Together. He is passionate about human rights and works tirelessly to help improve the lives of Canadian Aboriginal people. August 2009 | 55

innovation Integrating people, processes and technology for success z Laura Mottola

Innovation is essentially about value creation through either developing new concepts or applying known methods in novel ways. Furthermore, innovation can be incremental or breakthrough. In all cases, people are the source of innovation, and processes provide the means to generate and deploy it. When technology is at the core of innovation, both people and processes are integral parts of its successful development and deployment. This article advocates the need for an integrated approach, which includes three equally important pillars — people, processes, and technology. There is often a tendency to spend a lot of time and effort developing technology components because it offers a tangible way to show progress. After all, we need to demonstrate the viability of a technological solution before we can make a business case for its implementation. However, the highest return on investment can only be achieved if the processes affected are adjusted to take advantage of the enabling technology and the end users actually use it as it was designed. History has shown that without the appropriate business process changes at the site, the simple introduction of technology into an operation does not typically yield the promised productivity gains. There are many examples of troubled system implementations in our industry to illustrate how a failure to carefully consider the people-process side has had a devastating impact on the end result. Enterprise Resource Planning implementations provide numerous examples of technology 56 | CIM Magazine | Vol. 4, No. 5

initiatives that widely missed their schedule and budget due to inadequate understanding about the impact of the roll-out on people and processes. If we consider the automated mine as the breakthrough innovation being pursued, it is paramount to understand the implications for the workforce and the processes that drive the operation. A simple risk assessment will quickly show that without full consideration of both the people and relevant processes, the technology itself poses a significant risk to the safety of both personnel and property. As a mining engineer with a systems background, I have had the privilege of working on two innovative mine automation programs — the first in underground hard-rock mining and the second, more recently, in surface mining. Both initiatives required extensive development and field testing of technology components as well as viable overall system architecture. While in the first case there was no explicit people-process strategy, the second technology program adopted a more balanced approach, with equal emphasis on the three pillars.

The diagram illustrates the three pillars and their high-level components. Because the aim of this article is to discuss the importance of a people and process strategy in a technology program, it will not include an in-depth description of the technology components required for autonomy. The people strategy is a change management plan designed to prepare the organization to transition from manual to autonomous operation in an actual mining operation. It includes a communications plan to appropriately engage stakeholders, whether internal or external to the company. It also addresses the organizational design required to effectively embrace the paradigm shift created by the use of automation. The forward-looking company that wants to adopt autonomous mining must understand that it requires an organizational strategy to develop and retain the skill sets necessary to run it. A competency model must be developed, along with a staffing and recruitment process, training and development, as well as performance management and succession planning. Process mapping is required to fully grasp the changes that must be implemented in the way a mine is managed. With the implementation of mine automation, the mining operation cannot be run the same way as a conventional operation, primarily for safety reasons, but also to ensure the maximum realization of benefits in productivity, reliability and quality. Mapping the current state of processes — such as engineering, operations, and maintenance — ensures that key stakeholders are on

innovation the same page as to how each task is currently performed. A clear understanding of how each affected function is executed in the current manual mode will help define the process changes that are required in the future state, when autonomous mining is implemented. Process mapping is a participatory methodology that promotes cross-functional communication and builds buy-in. Without common understanding and engagement from all levels of management and operations, the final outcome will be jeopardized.

There are significant complexities inherent in the integrated approach that has been presented, but it should be noted that this balanced approach is not a rigid framework; it must be adapted to the particular needs of each organization that seeks to implement a gamechanging technology, such as mine automation. CIM

For more a detailed discussion, please send your comments and questions to: laura@mottola.ca.

About the author Laura Mottola is president and principal consultant of Mottola Consulting. She has a master’s of engineering in mining automation and over 15 years of experience working in industry, mainly in mining and metals, but also in the automotive and aerospace sectors. Her expertise covers program management, process improvement, Lean, systems thinking and change management.

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standards CIM input into NI 43-101 amendments z Deborah McCombe and John Postle

On January 20, 2009, the Canadian Securities Administrators (CSA) launched a project to revise and update National Instrument 43101 Standards of Disclosure for Mineral Projects. The British Columbia Securities Commission will lead the project with participation from other CSA jurisdictions. The project responds to a number of industry and regulatory concerns that have developed since NI 43-101 was implemented in 2001. As part of this project, several provincial securities commissions, including those of British Columbia, Ontario and Quebec, have held focus groups to seek input into potential revisions to the Instrument. In addition to general recommendations on amendments to NI 43-101, the focus groups also raised some issues specific to the CIM Definition Standards of December 11, 2005 and industry best practices. The CIM Standing Committee on Resource and Reserve definitions is seeking input from the mining industry on several of these comments.

Reasonable prospects for economic extraction Several comments pertained to the meaning of the “reasonable prospects for economic extraction” clause in the definition of a Mineral Resource. This clause appears in all the major Resource Definitions systems with little guidance. Not defined in NI 43-101, this term relies on the Qualified Person’s judgment and experience for its determination. Several Qualified Persons have offered interpretations of the clause. However, at this point, there is a wide range of views and little consensus on the matter. It has been suggested that the CIM Definition Standards should provide additional guidance to assist Qualified Persons in dealing with this issue. 58 | CIM Magazine | Vol. 4, No. 5

Inferred Mineral Resources

circumstances at a more advanced Addition of Inferred Resources to stage of a project. other categories of mineral resources. Many other Mineral Resource and Another issue discussed was the CIM Mineral Reserve codes developed Definitions Standards’ prohibition internationally, such as the against adding Inferred Mineral Australasian JORC Code, simply state Resources to other categories of minthat “caution should be used if eral resources. Currently under NI 43Inferred Resources are considered in 101, Indicated Mineral Resources and technical and economic studies.” Measured Mineral Resources can be Some codes provide more guidance on totalled if they are also disclosed sepathe use of Inferred Resources in ecorately. However, because of the low nomic studies. The Pan-European confidence level of Inferred Resources, Reporting Code (PERC 2008) manthey may not be included in the total dates clear disclosure if Inferred resource. Resources are used in economic analyThis exclusion comes from early ses. The South African SAMREC 2007 reviews of Canada’s Mineral Resource Code states that if Inferred Resources and Mineral Reserve definitions by CIM are included in economic studies, a in the 1990s. Back then, there was a comparison of the results with and third class of reserves known as without the Inferred Mineral Possible Reserves (the equivalent of Resources must be shown. Inferred Resource on a McKelvey box The above highlights some of the concept). Considered to be occasion- issues that have arisen from discussions ally abused in National Policy 2A (the on NI 43-101 amendments and CIM pre-2001 securities policy) reports, this Definition Standards. Clearly, more category was eliminated from the min- work needs to be done to arrive at a eral reserve definitions category. This workable consensus. The CIM Reserve was in keeping with international expeDefinition Committee solicits your rience in Mineral Resource and Mineral input on these and any other issues that Reserve definitions at that time. you may have. Please submit your comCurrently, the Australasian JORC ments to jvavrek@cim.org and Code allows the addition of the three john.postle@scottwilson.com. CIM categories of resources. The U.S. Securities Exchange Commission’s Industry Guide 7 does not allow the reporting of resource unless it is required by law in another country (for example, Canada). Thus, internationally, there is still no consensus. Broader use of Inferred Resources in economic studies. About the authors Deborah McCombe, NI 43-101 prohibits the use of executive vice-president of Scott Wilson Roscoe Inferred Mineral Resources in Postle Associates, is a consulting geologist who is economic analyses, except in strongly involved in Canadian disclosure standards preliminary assessments (scopfor the mining industry ing studies) prepared before a prefeasibility study. It is sugJohn Postle is a consulting mining engineer with gested that a scoping study Scott Wilson Mining Group, providing services to using Inferred Resources should international financial institutions, corporations, be permitted in very specific utilities and law firms.

student life Subatomic in Sudbury Students discover link between particle physics and the Canadian mining industry z Alex Giles and Marc-André Simard

Thinking of atom smashers and particle physics might bring to mind images of elderly absent-minded professors at some celebrated Swiss laboratory. You probably would not connect particle physics with a bunch of Canadian high school students and the city of Sudbury. But the three were brought together recently by Sudbury’s Mining Innovation, Rehabilitation and Applied Research Corporation (MIRARCO). MIRARCO, a Sudbury-based notfor-profit mining research company, reaches out to high school students in northern Ontario through the EXTREME Virtual Reality Expo (EXVR). A twist on the traditional science fair, EXVR introduces students to the use of 3D modelling. The project, made possible by the local scientific community and Laurentian University, is supported by the Ontario Ministry of Research and Innovation. As high school students at École secondaire Macdonald-Cartier, we recently participated in this program. The challenge at the Third Annual EXVR was to complete a research

project on a subject related to Sudbury’s mining industry. Participants explored topics that spanned from mine shafts and environmental chemistry, to the topic of our project, particle physics. You may wonder how particle physics relates to the Sudbury mining scene. The answer is that one of the world’s leading neutrino observatories, the Sudbury Neutrino Observatory (SNOLAB), lies deep in Creighton Mine, co-existing with one of Vale Inco’s major mining operations. Our topic chosen, we started reading up on the subject and thinking of preliminary ideas that could be visualized using 3D models. Leading industry experts helped us with the modelling. A past winner of the competition, Julie Mongeau, provided technical support and mentorship. Obviously, we learned a lot. We presented our project to the public and a panel of scientific and mining experts. Their critique of our work greatly furthered our learning. At the end of the night, we were delighted to learn that we had won the competition. This success proved to be the beginning of a bigger journey. More valuable than our victory was the opportunity we had to meet and interact with knowledgeable experts. During a question and answer session, we mentioned that we had never visited the SNOLAB. A week later, MIRARCO invited us for a tour of the underground laboratory. This was fantastic news for particle physics enthusiasts like us. Our windfall taught us that for youth entering the scientific community, it is important to jump on every available opportunity.

During our tour, we saw first-hand how heavily SNOLAB relies on its partnership with the mining industry. Two kilometres underground, miners blasting rock were working side-byside with researchers running experiments that can only be conducted underground. With our hands-on learning, we got answers to questions we could not even conceive of before going underground. Back on the surface, SNOLAB researchers advised us on our topic. Most importantly, we were able to establish personal ties to the scientific community. As first-place EXVR winners, we also won a trip to present our project with MIRARCO at the 7th Annual Canadian E-Learning Conference in Vancouver. This too, was an excellent learning and networking opportunity. This project broadened our horizons and taught us a few key lessons. It is important to work hard to create something unique and not be afraid to reach out to experts. This insight will serve us well as we begin our engineering studies next year. We chose co-op programs for our postsecondary education, as certain skills can only be acquired through fieldwork. Our experience with the EXTREME VR EXPO demanded a lot of work and effort but it was an adventure well-worth taking. CIM http://extremevr.mirarco.org

About the authors Alex Giles and Marc-André Simard are recent graduates from École secondaire MacDonald-Cartier in Sudbury. MarcAndré will enter a co-op program in September at the University of Waterloo to pursue studies in systems design engineering. Alex will begin studies in mechanical engineering at Laurentian University. August 2009 | 59

HR outlook The numbers are telling There is a consensus on the emergence of an HR crunch, but how do we predict its extent? z Sheldon Polowin Accurate labour market expansion or contraction, Ontario Forecast: Cummulative hiring requirements information (LMI) and foregiven the prevailing comMining Workers Required casting are essential for modity price index and occuenabling the mining industry pational coefficients; the Scenario 2010 2013 2018 to proactively plan and manage number of retiring workers; Neutral -3,027 1,277 11,382 its workforce. Encompassing and the number of workers Pessimistic -4,954 -2,220 5,578 data on employment levels, job who leave the industry due to Optimistic -588 4,717 17,004 vacancies, remuneration, voluntary separation. The worker demographics and table shows the cumulative other key parameters, LMI facilitates hiring requirements of Ontario’s minThe volatility of mining employdecision-making by human resources ing sector by 2010, 2013 and 2018, ment makes forecasting labour practitioners, governments, academia under the neutral, pessimistic and optidemand particularly challenging. and other stakeholders, such as youth mistic forecast scenarios, respectively. Forecasts are typically based on expecentering the labour market, transition- tations about economic variables that The Canadian mining industry will ing workers, immigrants and undoubtedly face significant human exhibit fairly stable patterns over time. Aboriginal Peoples. It routinely resources challenges over the next However, employment in the mining informs economic and social policy, decade. The current downturn will industry is more erratic than in other workforce planning and decisions not alter the demographics. Nearly sectors and is characterized by shortregarding investment in training. half of all mining employees are over term fluctuations of greatly varied In Canada, LMI is collected and dis- depth and duration. 45 years old, exceeding the ratio for seminated by Statistics Canada, the entire Canadian workforce. A sizAs revealed by regression analysis, Human Resources and Skills able proportion of these workers will the level of mining employment is Development Canada, Citizenship and highly correlated with metals and min- retire in the upcoming decade. Immigration Canada, Industry Canada, Meanwhile, skills shortages and erals prices. An Ontario study shows all levels of government and various declining enrolment in mining-orithat the commodity price index is the other organizations. Mandated to “best leading indicator” of mining ented academic programs will exaceraddress the mining industry’s HR chalbate the situation. A prudent and employment. MIWIN’s labour demand lenges, MiHR devotes considerable forecast is therefore largely based on well-coordinated strategy involving effort and resources to LMI. industry, governments, academia and commodity price expectations. Our Historically, LMI collection has not other stakeholders must be deployed Ontario forecast comprises three scebeen well-coordinated or consistent to preserve Canada’s leadership in narios — pessimistic, neutral and optiacross jurisdictions in Canada. MiHR, mining. The LMI provided by MiHR, mistic — of future commodity price together with 36 other sector councils, of which MIWIN is a key element, expectations. is changing this by standardizing and To accurately forecast hiring will be instrumental in helping indusstreamlining the acquisition, analysis try stakeholders address these and requirements, analysts require inforand dissemination of LMI. other critical issues going forward. CIM mation about the occupational strucTo forecast future hiring require- ture of the workforce. An “occupaments in the mining industry on tional coefficient” is the number of www.mihr.ca occupation-, region- and commodity- employees in an occuspecific bases, MiHR began develop- pation, as a proportion About the author ing the Mining Industry Workforce of all employees in Sheldon Polowin is program Information Network (MIWIN) in the relevant industry. manager, research and labour 2007. To date, MiHR has developed Hiring requirements market information at MiHR. He is forecasts for the mining sectors of for each year are foreresponsible for supporting the British Columbia, Saskatchewan cast by summing up development of the national and Ontario (freely available at the following: the Mining Industry Workforce www.mihr.ca/en/publications). Soon, change in the number Intelligence Network. we will have pan-Canadian forecast- of jobs required due to spolowin@mihr.ca ing capabilities. sectoral economic 60 | CIM Magazine | Vol. 4, No. 5

engineering exchange Sinking to new depths Close coordination and clever scheduling helped Dumas sink a winze shaft without interrupting production z Marlene Eisner Four years ago, Agnico-Eagle decided to dig deeper at its LaRonde mine. In production since 1988 and currently the largest operating gold mine in Canada in terms of reserves, the site is located in the AbitibiTémiscamingue region of northwestern Quebec, approximately 650 kilometres northwest of Montreal. Of the mine’s three shafts, the 2,250-metre deep shaft #3, the Penna shaft, is believed to be the deepest single-lift shaft in the Western Hemisphere. It is used to hoist LaRonde’s ore production of approximately 7,200 tonnes per day. The mining method is predominantly transverse longhole stoping with delayed cemented backfill. In May 2006, Agnico-Eagle decided to sink a winze shaft close to its Penna shaft in order to reach ore reserves of gold-copper and zinc-silver mineralization that until then had been inaccessible below level 245 (2,450 meters below surface) to a depth of approximately 3,110 metres. They engaged mine shaft specialists Dumas Contracting to sink the new winze. Sinking a shaft below the surface starting at the 2,056-metre level “is a project that even from the beginning has its own unique set of challenges,” said Jos Deschênes, Dumas general manager, Quebec and eastern Canada. One of the very first challenges Dumas faced was bringing the excavation equipment down via the surface ramp to the 215 level. This time-consuming process had to be executed with meticulous care because each bit of equipment had to be dismantled and lowered in the Penna shaft piece by piece and then put together before excavation of the winze could begin. The situation was further complicated by the ongoing production at the

Photo by Frédéric Langevin

The Clam (air-powered mechanical excavator) suspended from the underside of the shaft sinking platform (galloway), during the excavation of the 257 station.

mine. Twenty-four hours a day, seven days a week, ore is being hoisted to the surface via the Penna shaft. The Dumas team needed to find a solution whereby the daily ore needs were met, without delaying their schedule to sink the winze. They collaborated with Agnico-Eagle to coordinate shaft-sinking activities with the production imperatives of the operating mine. The winze is lined with concrete and built to custom size specifications, which presented yet another challenge for Dumas. Plans called for the winze to be large, measuring 5.5 metres in diameter and 835 metres in depth, in order for it to accommodate the needs of the new mine. It had to be roomy enough for two skips, a double-deck cage and an auxiliary cage (sometimes referred to as a Marianne).The broken

muck generated by the sinking of the shaft would be scooped out with a mechanical shovel, dumped into a bucket to bring it up to the 215 level, transferred to the Penna shaft, and then brought to the surface. The design of the winze included the construction of three large stations and approximately 40 metres of lateral development per station. When the winze is completed, the miners will be able to commence production drilling from these workstations. Dumas is currently working on the second station at 2,780 metres. Sinking the winze with ongoing mining activity presented another challenge to Dumas with regard to blasting, a potentially dangerous situation. Meticulous coordination with Agnico-Eagle was again needed so that blasting was done only in between shifts when no one was underground. And finally, ventilation and heat in the shaft were initially a problem, but large fans were installed into ventilation raises to remedy the situation. “Agnico-Eagle put a lot of time in this to make sure there was the right amount of air circulation,” remarked Deschênes. “We began at the 215 level and heat was an issue until they commissioned a 4.6 MW cooling plant on 146 level to ensure that the sinking crew would have comfortable working conditions. It didn’t interfere with us, and we continued to do our work.” With less than a year to go to complete the winze, Deschênes said the project will be finished on time. The shaft depth is now at 2,792 metres, not too far from the planned 2,840 metres. “We don’t expect any slowdowns or any major issues,” he said. “We are on target.” CIM August 2009 | 61

Bright lights, long shadows The curious coal of Albert County z Ryan Bergen Before 1850, no one gave too much thought to the black and glassy “coal” that ran in veins under the ground in New Brunswick’s Albert County. First found in the hollow left by an uprooted tree, locals burned it for heat, though its quality was dubious; it tended to melt at high temperatures, gumming up stoves and making a mess. Only when chemists began to recognize its potential for lighting did interest in the material catch fire. Once albertite, as it was dubbed, was distilled to a waxy oil, it burned cleanly and brightly, and offered a potential source of relatively cheap and efficient lighting for homes and factories. Scientific renown and an assured fortune awaited those who could meet the challenge of practical interior lighting. Not surprisingly, competition was fierce. One booster of the deposit near Hillsborough (believed by some to be Abraham Gesner, who would patent kerosene) wrote: “It has been traced along the surface several miles and the bituminous mineral appears at numerous points along a line of thickly wooded country sixty miles in length, and perhaps ten in breadth.” Gesner may have stoked too much interest in the resource. After his marketing blitz, when he went to purchase the mining rights in the fall of 1850, someone else had beaten him to it. Undeterred, Gesner leased the land where the mining claim was and began extracting the albertite with his own work crew within shouting distance of the mine. When officials at the Albert Mining Company realized their claim was being jumped, they 62 | CIM Magazine | Vol. 4, No. 5

scrambled an armed militia to chase Gesner and his men away. The fight moved to the court where Gesner insisted that the hydrocarbon was his for the taking because the Albert Mining Company only had rights to coal, not albertite. Gesner compiled a team of geologists to support his case. The mining company matched his panel by hiring one of its own. At the time, enterprising geologists had ample opportunities to collect consulting fees from companies within the growing mining industry. One such consultant hired by the mining company was Robert Foulis, a central figure in Saint John’s small scientific community. He testified in court that the glassy, brittle, pitch black material was coal. Though he and Gesner both lectured at the city’s Mechanic’s Institute there was no love lost between them. In a series of handbills, Foulis and Gesner fought a public relations battle over albertite, each trying to undermine the other’s character and claims. Tracts signed by Foulis jeered Gesner and his assertion that he was the first to harness the potential of albertite. Foulis, also deeply involved in the development of illuminating gas, insisted he had made use of the local product first. Gesner responded with venom of his own. Foulis, he wrote, was nothing but a corporate shill. The jury’s verdict came down on the wrong side of science, and Gesner lost access to the ready supply of bitumen he needed for the production of kerosene. In the end, neither man gleaned much profit from the albertite

deposit. Foulis had a stake in the mine but, over time, he alienated his business partners and was cut off from their partnership. Gesner’s opportunities in the British provinces all but exhausted, he moved to New York City in 1853 and for a short time, he enjoyed success as the chief chemist for the North American Kerosene Gas Light Company. Once again, Gesner was a step behind — James Young, a Scot, had patented a similar process that produced what he called paraffin oil from the distillation of torbanite coal. Despite the insistence by Gesner that “the oils produced by Mr. Young’s method are inferior in colour, odour, and illumination,” North American Kersone had to honour Young’s existing patents and pay him royalties. Gesner did not find his fortune in the United States. He returned to the Maritimes in 1861, the year he published “A practical treatise on coal, petroleum and other distilled oils,” which would soon become essential reading for those in the nascent petroleum industry. Nevertheless, the following year he was thrown into debtor’s prison in Saint John. His fortunes turned soon after when the newly established Dalhousie College in Halifax invited him to be professor of natural history. Gesner, unfortunately, died before he had the chance to begin lecturing. The albertite mine in Hillsborough operated from 1849 to the mid-1880s, but, though it was elemental in the development of what Gesner patented as kerosene, its product was little used in its commercial production. CIM

cim news CIM welcomes new members Abdelghani, Farouk Ben, Quebec Amyot, Gail, Quebec Beauvais, Marc, Quebec Bélanger, Emilie, Quebec Bélanger, Mélanie, Quebec Bélanger, Suzie, Quebec Belem, Tikou, Quebec Belles-Isles, Jean-Claude, Quebec Benoit, Dorothée, Quebec Benson, Craig H., USA Bertrand, Valérie, Ontario Bérubé, Sophie, Quebec Blanchard, Felix-Antoine, Quebec Blanchette, Daniel, Quebec Blier, Annie, Quebec Boutin, Patricia, Quebec Bouzahzah, Hassan, Quebec Brisbois, Robert, Quebec Brousseau, Yves, Quebec Buenano, Xavier, Ecuador Camara, Boubacar, Quebec Caron, Denis, Quebec Cassista, Annie, Quebec Chartrand, Francis, Quebec Chatelas, Cécile, Quebec Chen, Xu Eric, British Columbia Chénard, Sylvain, Quebec Cloutier, Vincent, British Columbia Cosset, Geraldine G.C., Quebec Côté, Jacinthe, Quebec Couillard, Yves, Quebec Coussy, Samuel, Quebec Cyr, Johanne, Quebec Dagenais, Anne-Marie, Quebec Dionne, Nicholas, Quebec Donnelly-Laliberté, Katherine, Quebec Doucet, Véronique, Quebec Doyon, Jean-François, Quebec Drouin, Marjolaine, Quebec Duenas, Carmen Gloria, Chile Dumas, Annie, Quebec Dupont, Pierre-Philippe, Quebec El Mustapha, Jaouhar, Quebec Ethier, Marie-Pier, Quebec Fourie, Pierre, British Columbia Gagnon, Frank, Quebec Gagnon, Mario, Quebec Gauthier-Hétu, Karine, Quebec Gautron, Deni, Quebec Gauvin, Michele, Quebec

Gauvreau, Sam, Ontario Gélineau, Martine, Quebec Germain, Caroline, Quebec Gil, Henry, Alberta Godbout, Jovette, Quebec Godbout, Mira, Quebec Gotz, Laszlo, Ontario Goulet, Yves, Quebec Grace, Peter, Nova Scotia Grandmaison, Cathy, Quebec Horvey, Magaly, Quebec Ivey, Douglas, Alberta Jacob, Henri, Quebec Khan, Arnab, USA Koffi, Kouadio, Quebec Labbe, Louise, Quebec Labrecque, Isabelle, Quebec Lacombe, Stéphane, Quebec Lacroix, Robert, Quebec Laflamme, Donald, Quebec Lafond, Jacynthe, Quebec Laliberté, David, Quebec Laliberté, Denis, Quebec Laliberté, Manon, Quebec Lambert, Jean, Quebec Lamontagne, Ann, Quebec Laniece, Vincent, Saskachewan Laperle, Guy, Quebec Lapierre, Daniel, Quebec Laquerre, Simon, Quebec

Lavoie, Jean, Quebec Lavoie-Gagnon, Pascale, Quebec Lebel, Alain, Quebec Leclerc, Jacques, Quebec Légaré, Pierre, Quebec Leonard, Kevin, USA Lépine, Thomas, Quebec Lesage, Pascal, Quebec Lévesque, Isabelle, Quebec Li, Li, Quebec Monette, Nicole, Ontario Monfet, Jean-Philippe, Quebec Morin, Judith, Quebec Morin, André, Quebec Morin, Nicole, Quebec Nault, Pierre, Quebec Neculita, Carmen Mihaela, Korea Noel, Michel, British Columbia Noël, Josée, Quebec Ouellet, Serge, Quebec Ouellette, Jean-Francois, Quebec Pal, Sujoy, Ontario Paquet, Marc, Quebec Pekrul, John, USA Penn, Alan, Quebec Roberts, Dylan N., Ontario Rocca, Pat, Ontario Samuels, Michael, Ontario

August 2009 | 63

cim news Sleuthing, cruising and teeing off CIM’s Northern Gateway Branch uses a range of activities to raise awareness and rally support By Roy Slack

CIM Northern Gateway Branch Executive (from left to right): Bernie Robertson, Tom Palangio, Brenda Patterson-Mack, Marcel Gravel, Moe St.Denis, Roy Slack, Kevin Melong, Rick Evans, Don Winter, Chelsa Mayhew, Sean Lawlor and Robert Gibson

Based in North Bay, Ontario, the CIM Northern Gateway Branch has had a long and active history. Although there is no active mining in North Bay proper, the area has been a hub for mining service organizations since the early 1900’s when it was the marshalling area and supply point for the Cobalt silver rush. Today, North Bay is home to over 60 businesses that provide services to the Canadian and international mining industry.

Going strong Having been quiescent for a few years, the branch was reinvigorated when Peter Balen of Atlas Copco rallied his peers to form a new group. Since that fateful barbeque in the summer of 2005 in Balen’s backyard, the branch has never looked back. In 2008, the group was presented the Mel W. Bartley Award at the CIM Awards Gala in Edmonton. The members of the diverse branch executive come from the whole spectrum of the local industry. Their dedication is exemplary. Alex Speirs, one of the branch’s founding members, even came out of retirement to join the executive team. 64 | CIM Magazine | Vol. 4, No. 5

A positive image The branch is committed to promoting a positive image of the mining industry within the community, especially among students, by working with Nipissing University, Canadore College and local school boards. Our intention is not so much to recruit students into the industry as it is to inform the public of the importance of mining and the opportunities it offers to young people. A number of our initiatives bring the industry to a more accurate light. One of the most effective has been the Mine Scene Investigation (MSI) show. This interactive dinner theatre for secondary students combines video with live acting and audience participation to “solve a mystery.” The audience reviews the “evidence” to determine what mining career a “missing person” has embarked on. Organized in conjunction with the North Bay Mining Association and supported by both Nipissing University and Canadore College, this event also includes campus tours. Each year during mining week, the branch, in conjunction with the North Bay Mining Association, organizes

unique interactive displays and activities for younger students. This year, we have implemented an award and scholarship program to increase awareness of the mining services industry in the area.

Good times The group has hosted numerous popular social events including the annual golf tournament. Held on a workday, it attracts many members and guests who cherish the opportunity to get away from the confines of their office and network in the open air. Proceeds from the tournament support our scholarship programs. The branch also holds an annual Lake Nipissing Cruise, a delightful party on the water that uses the attractions of gourmet food and lively music to raise money for local charities. This year, the cruise’s proceeds will benefit the North Bay food bank. The branch also believes in the power of collaborative endeavours. We recently joined the CIM Sudbury Branch to help it prepare for staging the Maintenance Engineering/ Mine Operators Conference (MEMO 2010), to be held from October 25 to 27, 2010 in Sudbury. CIM

cim news Exploring the scene CIM’s Red Lake Branch conducts its annual review of the latest developments in the industry By Carmen Storey

Gauche à droite / Left to right : Sylvain Hélie, Mélissa Hélie, Jean-François Lagueux, Sylvie Boisvert, Daniel Séguin

Des élans de bon temps par Jean-François Lagueux Le 30 mai 2009 avait lieu la 24e édition du Tournoi de Golf ICM – Section Harricana. Le tournoi s’est déroulé au Club de Golf Belvédère de Val-d’Or et a attiré plus de 200 participants. À noter la clémence de dame nature, qui, pour cette édition, nous a permis de passer la journée les pieds au sec grâce à l’une des premières vraies belles journées depuis l’ouverture de la saison de golf. Nous profitons de cette occasion pour féliciter les gagnants et les invitons à venir défendre leur titre l’année prochaine. Cette équipe, composée de Sylvain Hélie, Mélissa Hélie, Sylvie Boisvert et Daniel Séguin, a inscrit un pointage de -4, devançant de justesse l’équipe de SEMAFO composée de Patrick Moryoussef, Claude Filteau, Claude Carrier et Martin Bourgouin. En effet, les pointages étant égaux, il a fallu retirer le pointage du dernier trou afin de déterminer le vainqueur. Nous tenons à remercier l’ensemble de nos commanditaires pour le support apporté, sans oublier tous ceux et celles qui, par leur présence et leur bonne humeur ont contribué directement au succès de cette activité. ICM

Held on June 3, the Exploration Roundup represented another successful season of technical presentations for CIM’s Red Lake Branch. Over 50 people, primarily exploration personnel, including local prospectors, consulting geologists and students, attended this fullday event. The day kicked off with technical presentations, and later, the show was taken on the road with an afternoon field trip. The technical presentations featured an array of experts who reviewed the latest developments on local projects and exploration and mining activity in the area. A discussion on the Government of Ontario’s amendment of the Mining Act spurred a lively exchange of views on the proposed changes to the Act. With black fly season finally behind them, field trip participants were free to examine stripped outcrops with no pesky distractions. The outcrops showed extensive iron carbonate alteration with gold restricted to late-stage quartz veins. The degree of their complexity was sobering and awe-inspiring, especially for the students who took the trip. All in all, the day proved to be enjoyable and educative in equal measures. CIM Field participants examining stripped outcrops

A swinging good time Held on May 30 at the Belvedere Golf Club in Val-d’Or, the 24th Annual CIM Harricana Branch Golf Tournament drew over 200 participants. Mother Nature kindly provided one of the first great days since the start of the golf season, allowing participants to keep their feet dry the whole day. Competition was so close that the scores were actually tied, making it necessary to subtract the score for the last hole to determine the winner. The team, comprising Sylvain Hélie, Mélissa Hélie, Sylvie Boisvert and Daniel Séguin, finished with an adjusted score of -4, coming out just ahead of the SEMAFO team — Patrick Moryoussef, Claude Filteau, Claude Carrier and Martin Bourgouin. We wish to take this opportunity to congratulate the winners and invite them back to defend their titles next year. We would also like to thank all our sponsors for their support and, of course, everyone who directly contributed to the event’s success through their involvement and good cheer. CIM August 2009 | 65

cim news From the ground up The winner of the Order of Sancta Barbara is reshaping the public’s perception of mining By Robbie Pillo CIM’s Order of Sancta Barbara recognizes the important role played by women in the progressive development of Canadian mining communities. This year’s winner, Sheila Stenzel, has done more than her fair share to cement the bond between school teachers and the Left to right: Jim Gowans, CIM past president; Sheila Stenzel; and Kathleen Gowans industry. Stenzel’s untiring efforts, as director of the CIM: One of the program’s goals is to improve the image of mining among future Mineral Resources Education Program generations. How can this be achieved? of British Columbia (MREPBC), have Stenzel: Our industry must keep a tremendously benefitted both the lead on promoting itself through supindustry and its community. port for education. It is made up of The school program was created such good people, that the more to assist teachers in the development of educational materials to support opportunities they take to engage the public — in our case, school teachers the teaching of minerals science, mining and geoscience from kinder- and students — the more headway they make in ensuring a more curgarten to grade 12. It educates and rent and accurate perception of the informs the public and stimulates industry. young people’s interest in mining careers. Now in its 18th year, MREPBC has assisted more than CIM: What are the challenges you face as 7,300 British Columbia teachers and director of the school program? student teachers with mineral- Stenzel: The resource units are developed in accordance with the British relevant curricula and learning experiences. It is estimated to have Columbia Ministry of Education curriculum. As the curriculum is everreached more than 650,000 students. In an interview with CIM changing, we have to look for new Magazine, Stenzel discussed the scope ways to both encourage teaching of her work, her views on the indus- mineral-relevant topics at different try and the challenges and rewards of grade levels and to provide teachers her career. with the resources they need. Recently, the Ministry transferred CIM: How did you get involved with the the first strong earth sciences curricuschool program? lum from the primary to the grade 7 Stenzel: I first became involved as a level. We have found it difficult to volunteer and it grew from there. I keep primary teachers interested in later became the coordinator, and teaching about rocks — though chilwhen the program’s founder, dren love the topic — when it is not Maureen Lipkewich, retired I was formally in the Ministry’s prescribed hired as director. learning outcomes. 66 | CIM Magazine | Vol. 4, No. 5

CIM: How have you been able to address these changes? Stenzel: We have developed, and will implement this fall, a new grade seven earth sciences resource unit to support teachers at that level. As with our other units, this will be distributed in conjunction with a half-day workshop, and each teacher will be given a kit with a binder, posters, rocks and mineral samples, and images to support their teaching. To keep the program alive at the primary level, we have developed a half-day in-class workshop, also to be implemented this fall, for students to explore the many properties of rocks and minerals. This is great hands-on science exploration for the children. But our other goal is to inspire their teachers to address this more thoroughly in class, to lay down a good foundation in earth science, and to use the high-interest geology themes to build literacy skills, tackle math and to introduce social studies topics and careers. CIM: How do you feel about being awarded the Order of Sancta Barbara? Stenzel: It is a great honour. I have hung the plaque and medal on my office wall. It means a lot to have the industry recognize the school program’s accomplishments, which have been possible only because of our program’s dedicated partner-teachers and the support of our industry. Our success is thanks to the teachers and mining people who have worked together for 18 years to build a better understanding of our industry. CIM www.bcminerals.ca

Plenty to sink your teeth into CIM unveils its new lineup for the 2009-2010 Distinguished Lecturer season By Robbie Pillo The 2009-2010 CIM Distinguished Lecturer Program brings together some of the industry’s most engaging speakers, innovative thinkers and inspiring individuals to help keep branches and societies up to speed on the latest trends and developments. This year’s lineup of speakers (see box) will present a veritable smorgasbord of knowledge on topics ranging from the latest strategies in addressing Aboriginal human resource issues to sub-sea mining.

Currency and cohesion… Delivered by field-leading experts, each Distinguished Lecture is full of the very latest information, helping you ensure that your branch members’ grasp of developments in the industry is current and up-to-date. This is why the Distinguished Lecturer Program has always been so popular with CIM branches. “This program has provided our branch with the opportunity to host consistently outstanding speakers who have delivered presentations on a variety of topics, from geology to safety,” said Mark Smyk, chair/treasurer of CIM’s Thunder Bay Branch. Smyk’s high regard for the program is shared by Thompson Branch chair Inge Robinson, who noted, “The subjects covered have piqued our members’ interests, generating stimulating exchanges that were at the same time significant and fruitful.” Christian West, chair of CIM’s Oil Sands Branch, highlighted another important role the Distinguished Lecturer Program plays at the branch level. “Bringing a Distinguished Lecturer to our branch has provided an opportunity to enrich our technical presentation series and broaden our membership reach,” he remarked. Inviting a Distinguished Lecturer to your next branch meeting could thus help cement your membership’s cohesion in addition to furthering its education. Branch executives across the country have reported that meetings featuring a presentation by a Distinguished Lecturer are better-attended and better-appreciated, helping to potentially attract new members and to sustain the interest and involvement of existing members.

… and convenience too As beneficial and rewarding as it is to run a CIM branch in a remote location, it is not always easy fulfilling members’ need for current knowledge, as access to resources and information may be difficult. The Distinguished Lecturer Program offers the perfect, most convenient solution. Undeterred by distance and difficulty of travel, our lecturers are committed to come to you to offer your members the benefit of their expertise. If you have found it hard to get people with the same interests to come together, rest assured that having Distinguished Lecturer speak at your event will bring more people to the table. As Smyk noted, “The Distinguished Lecturer Program is especially important to smaller and more remote branches, which may not have many local speakers to draw upon.” It is thanks to our generous sponsors, Atlas Copco and the Canadian Mining and Metallurgical Foundation, who support CIM’s quest to provide its members the greatest opportunities for knowledge sharing, networking and professional development, that the branches can enjoy the benefits of the Distinguished Lecturers Program. CIM

cim news United we stand CIM’s new One Membership initiative promises streamlining, solidarity and synergy By Minaz Kerawala It is surely a testament to our vitality that the CIM family has grown so prolifically, spreading across our vast country since its inception over a century ago. However, as with many families, those who were once linked by kinship have come to cluster into different groups, sometimes making communication and united action difficult. The realization that we at CIM are united by common interests and that this unity must be reflected in our organizational structure yielded the One Membership initiative, currently being rolled out to CIM branches across Canada.

Coming together At present, there are two levels of membership — national and branch. National membership also includes societies and other special categories such as retirees. However, numerous branch members are not national CIM members and only participate in local branch activities. Branch-level membership records have been traditionally maintained separately by the branches. Branch members who are not national members, while entitled to participate in many excellent branch activities, are not entitled to important national membership benefits that would give them access to CIM best practices and a better understanding of our industry. In addition to impeding communication with many of our stakeholders, this duality has led to some organizational inefficiencies. To address this situation, the idea of one membership emerged a number of years ago, coalescing in 2006. At a Council meeting in February 2007, under the leadership of Jim Popowich (CIM president 2007-2008), a motion was passed 68 | CIM Magazine | Vol. 4, No. 5

unanimously to adopt the One Membership concept. The One Membership proposition is quite straightforward. For a nominal additional fee of $ 10 at the branch level, all qualified branch members are upgraded to a basic-level national membership. Their records enter CIM’s national database, and they will have full access to the online membership directory. In addition, they receive a copy of the December “outlook issue” of CIM Magazine containing the national membership directory, an official CIM membership card, all CIM official communiqués and the ability to manage their membership accounts online. The infrastructure for these facilities is currently being put in place. The branches retain full autonomy over setting their membership rates and planning and running their activities; however, they pass on the responsibilities of database management and dues invoicing to the CIM national office. Access to the online members’ directory and CIM national office’s advanced online communication tools are some of the other benefits that branch executives enjoy. In addition, CIM’s national office ensures compliance with privacy laws and maintains data securely on the branches’ behalf.

A visionary move Popowich, who together with the then incoming president Jim Gowans and CIM executive director Jean Vavrek, led the nuts-and-bolts development of One Membership, is wellplaced to speak of the rationale behind the initiative. “The concept has been considered for many years,” said Popowich. “It is more than a merging of databases. With One Membership, CIM can better communicate with all those interested in the

minerals industry — locally and at the bigger-picture level. We felt that CIM should address softer issues such as education, safety and corporate social responsibility, and we needed to connect with all in our industry so they could be better advocates of it. The best way to do this was through our branch members — the grassroots and the mainstay of our industry. Under the former system of membership, we had no way of communicating with our significant stakeholder base. Hence the concept of One Membership began to emerge.” Another important strand of the fabric of this idea relates to CIM’s need to attract more and younger members. Michael Allan, the current CIM president, explained: “I believe we need to focus on getting more of our younger members involved in CIM activities. Many of them are active in branches but may not participate in national activities. Although I was always a national member, my involvement with CIM started with branch activities and progressed to being involved with CIM’s national meetings and ultimately to being on Council.” Allan is optimistic that many young branch members will follow a similar path and that CIM will benefit from the fresh ideas of young talent. One more reason for which the branches are vitally important is that, as Jean Vavrek pointed out, “the branches are the key avenue through which our ‘retired’ members stay connected and maintain lifelong friendships, enabling us all to profit from the wealth of their experience.” Significantly, president-elect Chris Twigge-Molecey and his successor, Chuck Edwards, have also thrown their support behind the move, ensuring that the CIM leadership’s commitment to

cim news One Membership is sustained well into the future, long after the tenures of its original architects have been completed.

Economies of scale Big-picture benefits notwithstanding, One Membership just would not take off if it did not offer benefits at the everyday level. “We needed to make the cost reasonable,” explained Popowich. “Many at the branch level, while interested in the bigger picture, did not wish to pay a high fee. We also wanted to reduce the branches’ workloads by maintaining their membership database for them. The branches are operated voluntarily by people who have regular day jobs, so we want to make things easier for them. With our new web-enabled systems, we have better tools to assist the branches with communication through a secure central medium that is constantly updated. Branch membership renewals can also be more effectively handled from a central database. One Membership will significantly reduce the workloads of branch executives at a very low cost.” Elaborating on another important benefit, Allan said: “All membership records are maintained in a secure system. The potential issues with privacy legislation that can plague ‘unregulated’ databases are taken care of by having CIM National look after the data. Also, potential liabilities for which CIM is ultimately responsible, such as those pertaining to taxation, can be better managed.” Finally, Allan added: “We will have the potential to perhaps dramatically increase our national membership.”

Gaining ground The One Membership initiative has already been implemented at 12 branches. Despite a few concerns, the reception has been largely positive. “We decided to be the test market for One Membership for multiple reasons,” said Cameron Rennie of CIM’s Winnipeg Branch. “Firstly, having CIM National manage our database alleviates a large workload. Secondly, the program will provide our branch mem-

bers with numerous benefits, including a member card, access to the CIM membership directory, etc. Thirdly, the program helps to ensure that the member database and communications meet the requirements of privacy laws.” Eric Hinton of the Red Lake Branch had his eyes on the big picture. “We wanted to gain access to possible scholarship funding for high school graduates within the national body of CIM. We had been using the CIM name for many years and had not gained a lot of opportunity, except for that of the Distinguished Lecturer tour. There are other resources available to the branch from the national office, such as potential financial support, advertising space, and marketing and networking opportunities that would otherwise have to be started from the ground up. The Red Lake community can also benefit by finding out what other communities are doing with the resources available for schools, and from the availability of people to answer any number of questions, either technically or socially.” These sentiments are echoed by many branch executives. “When the New Brunswick Branch decided to move to One Membership, it was our understanding that this was part of the consolidation of finances and therefore it made sense,” recalled Paul Rennick. “The greatest benefit for our branch members will be the communication for national issues and events, a facility that previously was not available.” The Vancouver Branch adopted One Membership because it simply made sense from a cost-benefit perspective. “A number of administrative and legal issues provided very compelling reasons to sign on,” explained former branch chair Alex Doll. “By moving all branch members under the national umbrella, insurance and tax issues are allayed. Collecting administrative tasks under the national umbrella is more cost-effective than each branch registering as a non-profit society, buying insurance, remitting GST (for bigger branches) and having the books audited. A branch that is

prepared to do all this probably wouldn’t see much benefit in One Membership. But, they should ask if they would really be saving money, given the nominal cost of One Membership.”

It’s bigger than it seems As more branches come on board, One Membership is destined to grow into much more than an administrative union. The more people that come together, the more expectations they will have. Welcoming this prospect, Vavrek, said: “We need to get to a point where people say, ‘This works for us’. That’s a commitment we’ve made. Right now, it’s the first stage and I know that people have expectations from us. At this early stage, we can only estimate them. I am hoping that the implementation will be an interactive process, and invite feedback from our branches on what they expect and how it is working for them. The sooner we know what they need, the sooner we can work to meet those needs.” Vavrek will not have long to wait. Feedback is already trickling in from the branches. “Our hope is that CIM National can share its abilities to attract new members at the branch level, allowing us to increase our membership and visibility,” declared Rennie. This is also on Hinton’s mind. “We expect more visibility of our branches within the CIM Magazine and more support from national sponsors for our events,” he said. “We also want the leadership to be visible in the community, showing that we are involved both on the mining side and the community side.” With so much to be immediately and potentially gained from One Membership, it is little wonder that Popowich and Allan are so enthusiastic. “We are a strong networking institute and One Membership just allows CIM to be better at this,” said Popowich. Allan, on whose presidential watch the initiative is being implemented, added: “This will be good for the branches and good for CIM overall. We will all benefit.” CIM August 2009 | 69

cim news L’union fait la force Le nouveau Membership à guichet unique de l’ICM promet rationalisation, solidarité et synergie C’est sûrement un témoignage à notre vitalité que la famille ICM a crû de manière si proliférante, se répandant à travers notre vaste pays depuis ses débuts il y a plus d’un siècle. Toutefois, tout comme de nombreuses familles, ceux qui étaient autrefois liés par des liens de parenté se sont regroupés autrement, rendant parfois difficiles les communications et les actions unifiées. La réalisation que nous, de l’ICM, sommes unis par des intérêts communs, et que cette unité doit être reflétée dans notre structure organisationnelle, a conduit à l’initiative du Membership à guichet unique, laquelle est en voie d’être mise en œuvre dans les sections de l’ICM à travers le Canada.

Se rassembler Il y a actuellement deux niveaux d’appartenance à l’ICM — le national et celui de la section. Le membership national comprend aussi les sociétés et d’autres catégories spéciales telles que les retraités. Toutefois, de nombreux membres des sections ne sont pas membres de l’ICM au niveau national et ils ne participent qu’aux activités de leur section locale. Les listes des membres des sections ont traditionnellement été maintenues séparément par les sections. Bien qu’ils puissent participer à de nombreuses excellentes activités de section, les membres, qui ne sont pas membres nationaux, n’ont pas droit aux bénéfices importants de membership national qui leur donneraient accès aux meilleures pratiques de l’ICM et à une meilleure compréhension de notre industrie. En plus de nuire aux communications avec plusieurs de nos intervenants, cette dualité a mené à des inefficiences organisationnelles. Afin de remédier cette situation, l’idée d’un membership unique a été avancée il y a quelques années, aboutissant en 2006. Lors d’une réunion du Conseil en février 2007, sous la gouvernance de Jim Popowich (président de l’ICM 2007-2008), une motion a été 70 | CIM Magazine | Vol. 4, No. 5

unanimement votée d’adopter le concept de membership à guichet unique. Cette proposition de membership à guichet unique est assez claire. Pour une somme nominale additionnelle de 10$ au niveau de la section, tous les membres qualifiés de la section deviennent membres nationaux à un niveau de base. Leur dossier est saisi dans la base de données de l’ICM national et ils ont plein accès au bottin des membres en ligne. De plus, ils recevront la copie du CIM Magazine de décembre offrant un aperçu de l’année à venir et qui contient le bottin des membres nationaux, une carte officielle de membre de l’ICM, tous les communiqués officiels et la possibilité de gérer leur compte de membre en ligne. L’infrastructure pour ces fonctionnalités est actuellement en voie d’être mise en place. Les sections gardent toute leur autonomie sur l’établissement des frais de membership ainsi que la planification et la gestion de leurs activités. Elles cèdent toutefois la gestion de la base de données et de la facturation des cotisations au bureau national de l’ICM. L’accès à la base de données nationale et aux outils de communication perfectionnés de l’ICM national sont quelquesuns des autres avantages dont peuvent bénéficier les dirigeants des sections.

Une démarche visionnaire M. Popowich qui, avec le présidentélu d’alors Jim Gowans, et le directeur exécutif de l’ICM, Jean Vavrek, a mené le développement des rouages du membership à guichet unique, est bien placé pour parler des raisons d’être de l’initiative. « Le concept avait été considéré depuis plusieurs années », dit M. Popowich. « C’est beaucoup plus que la fusion de bases de données. Avec le membership à guichet unique, l’ICM pourra mieux communiquer avec tous ceux qui sont intéressés par l’industrie minérale – à l’échelle locale et à un niveau d’ensemble plus élevé. Selon nous, l’ICM devait aussi traiter des questions auxiliaires telles que l’éducation, la

sécurité et la responsabilité sociale des entreprises, nous devions aussi nous relier à tous les intervenants de notre industrie afin que tous y prennent part. La meilleure façon de ce faire était par nos membres des sections – la base et les piliers de notre industrie. Sous l’ancien système d’adhésion, nous n’avions aucun moyen de communiquer avec notre importante base d’intervenants. » Un autre important but de cette idée est le besoin pour l’ICM d’attirer plus de membres et plus jeunes. Michael Allan, le président actuel de l’ICM, explique : « Je crois que nous devrions cibler l’implication des plus jeunes membres dans les activités de l’ICM. Plusieurs sont actifs au niveau des sections mais ne participent pas aux activités nationales. Bien que j’ai toujours été un membre national, mon implication dans l’ICM a débuté par des activités de section pour ensuite progresser vers une implication dans les congrès nationaux et finalement siéger au Conseil d’administration. » M. Allan est confiant que les jeunes membres des sections auront un cheminement semblable et que l’ICM pourra bénéficier des nouvelles idées des jeunes talents. Une autre raison pour laquelle les sections sont si importantes est que, comme le dit Jean Varvek, le directeur exécutif de l’ICM « Les sections sont la principale voie par laquelle les membres ‘retraités’ demeurent en contact et entretiennent des amitiés de toute une vie, nous permettant tous de profiter de leur vaste expérience. » De manière significative, le président-élu Chris Twigge-Molecey et son successeur, Chuck Edwards, supportent aussi ces démarches, assurant ainsi que l’engagement des dirigeants de l’ICM envers le membership à guichet unique est bien ancré dans le futur.

Économies d’échelle Nonobstant les bénéfices évidents, le membership à guichet unique ne pourrait devenir réalité s’il n’offrait pas des bénéfices tangibles au jour le jour.

cim news « Le coût doit être raisonnable », explique M. Popowich. « Au niveau des sections, plusieurs étaient intéressés par le concept mais ne voulaient pas payer une cotisation élevée. Nous voulions aussi réduire le fardeau de travail des sections en maintenant leurs bases de données. Les sections sont gérées par des bénévoles qui ont des emplois réguliers, nous voulions donc leur faciliter la tâche. Avec notre nouveau système sur le Web, nous avons de meilleurs outils pour aider les sections avec leurs communications grâce à un environnement sécurisé qui est constamment mis à jour. Le renouvellement des adhésions des membres des sections peut aussi être géré plus efficacement à partir d’une base de données centralisée. Le membership à guichet unique réduira la charge de travail des exécutifs des sections, et ce, à très faible coût. » Pour expliquer un autre bénéfice important, M. Allan dit : « Tous les dossiers des membres sont conservés dans un système sécurisé. Les questions potentielles de législation relative à la protection de la vie privée qui peuvent être un fléau pour les bases de données ‘non réglementées’ sont réglées par le fait que c’est l’ICM national qui gère les données. Les obligations légales, telles que la taxation, pour lesquelles l’ICM est responsable en bout de compte, peuvent être mieux gérées. »

Gagner du terrain L’initiative de membership à guichet unique est déjà implantée dans 12 sections. Malgré quelques préoccupations, l’initiative a été reçue de manière positive. « Nous avons décidé de servir de marché témoin pour de nombreuses raisons » dit Cameron Rennie, de la section Winnipeg. « Premièrement, le fait que l’ICM national gère notre base de données nous enlève une grande charge de travail. Deuxièmement, le programme donnera de nombreux avantages à nos membres de la section, entre autres par une carte de membre et l’accès au bottin des membres de l’ICM. Troisièmement, le programme aide à assurer que la base des données et les

communications sont conformes aux exigences des lois sur la protection des renseignements personnels. » Eric Hinton de la section Red Lake visait haut. « Nous voulions avoir accès, auprès de l’ICM national, à du financement possible pour des bourses attribuées à des diplômés du secondaire. D’autres ressources sont aussi disponibles pour les sections à partir du bureau national, par exemple, un soutien financier potentiel, de l’espace publicitaire et des possibilités de marketing et de réseautage qu’il aurait sinon fallu tout mettre en place. La communauté de Red Lake y trouvera son bénéfice en découvrant ce que font les autres communautés avec les ressources disponibles pour les écoles et de la disponibilité des gens pour répondre à presque n’importe quelle question, qu’elle soit technique ou sociale. » Les dirigeants de nombreuses autres sections partagent ces sentiments. « Lorsque la section Nouveau-Brunswick a décidé d’adopter le membership à guichet unique, nous avions compris qu’il s’agissait de la consolidation des finances et que l’idée était bonne », dit Paul Rennick. « Le plus grand bénéfice pour les membres de notre section sera la communication des activités et des enjeux nationaux, un mécanisme qui n’était pas disponible antérieurement. » La section Vancouver a adopté le membership à guichet unique simplement parce que c’était logique d’un point de vue coûts-avantages. « Plusieurs questions administratives et légales nous ont convaincu d’y adhérer », explique l’ancien président de la section, Alex Doll. « En transférant tous les membres de la section dans le cadre national, les questions d’assurances et fiscales sont réglées. Regrouper les tâches administratives dans un cadre national est plus rentable qu’avoir chaque section s’enregistrer en tant que société à but non lucratif, acheter de l’assurance, remettre la TPS (pour les grosses sections) et faire vérifier ses livres. Une section qui est prête à faire tout cela ne verra probablement pas grand bénéfice au membership à guiche unique. Ces sections devraient cependant se deman-

der si elles sauvent de l’argent étant donné le faible coût du membership à guiche unique. »

C’est bien plus gros qu’il ne le semble À mesure que de plus en plus de sections y adhèrent, le membership à guichet unique devrait croître pour devenir beaucoup plus qu’une simple union administrative. Lorsqu’un grand nombre de personnes se rassemblent, les attentes croissent. Heureux de cette perspective, le directeur exécutif de l’ICM, Jean Vavrek, dit : « Dans le moment, il s’agit d’une première étape et je sais que les gens ont des attentes. À ce stade précoce, nous ne pouvons que les estimer. J’espère que la mise en œuvre sera un processus interactif et j’invite les sections à nous dire ce qu’elles attendent et ce qui fonctionne bien dans le moment. Plus vite nous connaîtrons les besoins, plus vite nous pourrons les satisfaire. » M. Vavrek n’aura pas à attendre longtemps. Des réactions entrent déjà des sections. « Nous espérons que l’ICM national pourra partager ses capacités d’attirer de nouveaux membres au niveau local, nous permettant ainsi d’accroître notre membership et notre visibilité », a déclaré M. Rennie. C’est aussi ce que pense M. Hinton. « Nous nous attendons à plus de visibilité pour les sections dans le CIM Magazine et à plus de soutien des commanditaires nationaux pour nos événements », dit-il. « Nous voulons aussi que le leadership soit visible dans la communauté, démontrant que nous sommes impliqués à la fois du côté minier et du côté communautaire. » Avec tant à gagner immédiatement et potentiellement avec le membership à guichet unique, il n’est pas surprenant que MM. Popowich et Allan soient si enthousiastes. « Nous sommes un institut avec un fort réseau et le membership à guichet unique permet tout simplement à l’ICM de s’améliorer sur ce point », dit M. Popowich. M. Allan, le président de l’ICM durant la mise en œuvre de cette initiative, ajoute : « Ce sera bon pour les sections et bon pour l’ICM en général. Nous en bénéficierons tous. » ICM August 2009 | 71

calendar CIM EVENTS

AROUND THE WORLD

Sudbury Branch Rudolph Kneer Memorial Golf Tournament Lively Golf and Country Club August 8 Lively, Ontario Contact: George Darling Tel.: 705.691.1812 Email: george.darling@stantec.com

SIMIN 2009 August 21-24 Santiago, Chile Contact: Osvaldo Gonzalez Gallardo Email: osvaldo.gonzalez.g@gmail.com Website: www.simin.cl

Red Lake Branch Technical Branch Meeting Guest speaker: Robert Adams August 19 Red Lake, Ontario Contact: Dar Woods Tel.: 807.727.0444 Email: jwoods2100@aol.com Conference of Metallurgists, COM 2009 ConfĂŠrence des metallurgists, COM 2009 August 23-25 Sudbury, Ontario Contact: Brigitte Farah Tel: 514.939.2710, ext. 1329 Email: bfarah@cim.org Website: www.metsoc.org New Brunswick Branch 34th Annual Convention September 10-12 Bathurst, New Brunswick Contact: Paul Rennick Email: paul.rennick@gnb.ca Toronto Branch, Frank Grieco Golf Day September 16 Toronto, Ontario Contact: Nancy Mcnab Tel.: 416.352.1989 Email: cim_toronto@rogers.com Northern Gateway 4th Annual Golf Tournament Highview Golf Course September 18 North Bay, Ontario Contact: Bernie Robertson Tel.: 705.474.4400 Email: bernie.robertson@kibl.com South Central BC Branch Annual Meeting September 23-25 Kamloops, British Columbia Contact: Peter Witt Email: Peter.Witt@teck.com

72 | CIM Magazine | Vol. 4, No. 5

IFRS: Key Concerns for the Mining Industry August 25-26 Vancouver, British Columbia Contact: Tim McCubbin Email: tmccubbin@infonex.ca Website: www.infonex.ca 4th International Conference on Mine Closure September 9-12 Perth, Western Australia, Australia Contact: Jill Hollinshead Tel.: +61.8.6488.3300 Email: acginfo@acg.uwa.edu.au Website: www.mineclosure2009.com PERUMIN 2009 September 14-19 Arequipa, Peru Contact: Tatiana Castro Tel.: +511.349.4262 Email: tcastro@iimp.org Website: www.convencionminera.com Economic Evaluation and Investment Decision Methods September 14-18 Golden, Colorado, USA Contact: John Stermole Toll Free: 800.446.9488 Website: space@mines.edu Heavy Metals Conference 2009 September 20-23 Drakensbourg, South Africa Contact: Julie Dixon Tel.: +27.11.834.1273 Email: julie@saimm.co.za Website: www.saimm.co.za

history Butte, Montana (Part 4)* By R.J. “Bob” Cathro, Chemainus, British Columbia “Reno Sales insisted that every mine operator, geologist, and even prospector appraises the future of mining properties on the basis of a theory of ore deposition whether he realizes the fact or not, and wherever the ultimate value of a mine or prospect is dependant on undeveloped ore, any estimate by an engineer or a geologist necessarily involves a theory of the origin of the deposit. Thus, the importance of a theory of the genesis of ore deposits cannot be overestimated” ~ Perry and Meyer, 1968

* Except where noted, information on Reno Sales and the Anaconda geological department has been derived from Perry and Meyer (1968) and McLaughlin and Sales (1993). The production data comes mainly from Long et al. (2000), and from personal communications from John Dilles and Richard Berg.

Mine mapping Because of its economic importance, the litigation problems caused by the Apex Law, and its extensive underground development (1,600 kilometres of drifts and 67 kilometres of shafts), Butte received more intensive study than almost any other mineral deposit, which is why it ranks as one of the most important sites of mineral deposit research. According to Graton (1947), Anaconda’s Butte mines hosted “the first geological department of any importance established by a mining company — and perhaps the earliest on any scale.” He described its origins as follows: “Systematic study of the Butte deposits by the U.S. Geological Survey had begun in 1896 under the direction of S.F. Emmons and continued for several years. … D.W. Brunton, as consulting engineer for Anaconda, advocated geological study (to resolve boundary disputes arising from the Apex Law) in 1900 and engaged for that purpose H.V. Winchell, who organized a staff and began systematic underground mapping. … In 1901, R.H. Sales, who had earlier worked (in other Butte mines and with the Federal geologists), joined the company’s geological department. In 1906, Sales became chief geologist.” Reno Sales was born in Iowa in 1876 and moved to Bozeman, Montana, in 1881 where his father became a rancher. After receiving a science degree from Montana State College and a graduate degree (Engineer of Mines) from Columbia School of Mines in 1900, he returned to Montana to become an engineer-surveyor at Butte. Sales, Winchell and Brunton began to standardize and compile the geology throughout the camp and, in the process, they established the principals for systematic surface and underground mapping that eventually became the model used worldwide. This was the same Brunton who had received a patent in 1894 for the compass that is named Reno Sales (1876-1969) after him, and which is still in use. Sales served as chief geologist until 1948, another 14 years as a consulting geologist, and died in Bozeman in 1969 at the age of 92. In its early years, Anaconda’s geological work remained closely concerned with boundary rights and litigation. The underground mapping was, therefore, carried out with unprecedented care and detail to make the maps, sections and models express the exact conditions underground and to ensure that they would be difficult to challenge in court. Since Butte is characterized by numerous strong, through-going veins of various attitudes and by several sets of strong fault displacements, and because Apex litigation primarily involved geometrical considerations, the geological work of those early years was concerned chiefly with the interpretation and solution of structural problems. After the ownership of the mines was consolidated and the litigation period ended, the geological department began to focus more on geological features on a districtwide basis. Initially, priority was accorded to mine operation and production. In particular, great efficiency was achieved in projecting the known pattern of intersecting veins and faults into contiguous unopened ground. In addition, the nature and geometry of the mineralization received consistent attention, and variations in mineral character and texture and in the type and intensity of wall-rock alteration gradually evolved into the well-known zonal pattern. In 1913, Sales published a classic paper August 2009 | 73

economic geology on mineral zoning at Butte that tonnes (2.9 million stands as one of the great geologounces) of gold, 1.7 milical contributions made directly lion tonnes of manganese, by a mining company. 400,000 tonnes of lead, In 1919, the geological 87,000 tonnes of molybdedepartment took over the direcnum, small amounts of tion of mine sampling; it was cadmium, bismuth, selenium, and tellurium, and combined with the mining department in 1928 to form a over eight million dry group that employed 15 geolotonnes of sulphuric acid. gists, 44 engineers, 67 samplers Subsequent production of and 11 draftsmen. At the same copper, molybdenum, siltime, a new program was implever and gold from the mented to develop a new tonne Continental Pit is unavailof ore reserves to replace each able, but is insignificant in tonne mined (Linforth, 1933). relation to the 1996 total. The Butte geological departManganese production ment was the largest and started in 1917 and peaked strongest of its kind for many during both World Wars. years and was credited with In 1944, Butte was respontraining a large number of geolsible for 98 per cent of the ogists in standardized and effectotal U.S. production. tive methods of underground An example of how systematic underground mapping was used on the 1400 foot Level Detailed information the Mountain View mine at Butte to recognize a structural problem and discover more mapping (the Anaconda of about average ore grades ore. A drift following segments 1426, 1424 and 1427 of the No. 8 vein passed through school). One unique policy was a fault and intersected 1429, which had a reverse dip (see the inset in the upper right mined at Butte is scanty. that responsibility for under- corner). The mapping showed that 1429 was part of a different, parallel vein (No.10) The best estimates are that led to the discovery of segment 1435, which was the continuation of No.8 vein ground exploration was steadily and about 23 million tonnes (from Linforth, 1933). delegated to the geological averaging 6% Cu were department, rather than to the production department as at mined during the first 20 years (1881-1901); about 143 million tonnes of 4% Cu ore were mined from veins most mines. That policy is still resisted at some mines today. between 1902 and 1962; 30 million tonnes of porphyry ore The three basic contributions of Reno Sales to mining grading about 1% Cu was mined underground between geology were described as follows: 1) he provided a superb 1952 and 1962; 306 million tonnes of milling ore at an standard of technical competence and intellectual integrity at average grade of 0.60% Cu and 345 million tonnes of leacha time when others were confusing observations and ‘authoring ore grading about 0.25% Cu was mined from the ity’; 2) few men, within the universities or outside, directly Berkeley pit between 1954 and 1982; 85 million tonnes and personally influenced as many students of mining geolaveraging 0.40% Cu and 0.04% Mo came from the ogy (nearly 100); and 3) he left us with a basic philosophy, Continental pit between 1973 and 1991; and 46 million endeavouring throughout his life to minimize the distinction tonnes averaging 0.60% Cu was derived from so-called ‘Znbetween pure and applied geology (Perry & Meyer, 1968). Pb ore’ between 1905 and 1967. Butte production history A large part of the deposit that extends beneath the bottom The mined portion of the Butte deposit is contained of the abandoned mine is estimated to contain over 25 million within an area of about six kilometres by three kilometres tonnes of copper (almost twice as much as was produced), 2.3 and extends to a depth of over 1.5 kilometres. In 1955, the million tonnes of zinc, 1 million tonnes of molybdenum, and value of its cumulative production was only exceeded 80 tonnes of silver. This represents the largest unmined worldwide by the South African Rand gold production. resource of copper and silver and the third largest resource of Over 1.1 billion tonnes of ore and waste had been mined zinc in the United States. Although that resource is unlikely by the end of 1996 to produce approximately 14.6 million to be mined in the foreseeable future, it helps to demonstrate tonnes of copper, making it the second largest producer in the gigantic size of the Butte mineral deposit. the United States, after Bingham Canyon. Copper producIn the early years, the rich near-surface lodes were mined tion peaked in 1917. It was also the second largest producer by at least 45 companies. Because of generally good ground of silver (22,400 tonnes = 720 million ounces), exceeded conditions, open-stoping methods were used for the first 70 only by the Coeur d’Alene district in Idaho, and the sixth years. As the price of copper weakened after the end of largest producer of zinc (2.2 million tonnes). In addition to World War II in 1945, and the average grade declined as the the main metals discussed above, Butte also produced 90.1 richest parts of the orebody were depleted, Anaconda was 74 | CIM Magazine | Vol. 4, No. 5

economic geology forced to change its mining methdesignated a 300-square-mile (483ods in order to lower production square-kilometre) area surrounding costs. A block caving mining the smelter as a federal Superfund method was introduced in the site, the largest in the country. A horsetail area, on the east side of the Superfund site is defined as an abanmine, between 1952 and 1962. It doned place containing hazardous produced 29.5 million tonnes averwaste that might affect local ecosysaging about 1.0% Cu. tems or people. Reclamation and The next significant change was cleanup within the site are managed the Berkeley open pit, which was under an agreement between the started in 1955, when the price of EPA, the Montana Department of copper reached the highest level Environmental Quality and ARCO since 1918, and operated until (EPA Superfund information, 2009). 1982. The average grade was 0.75% Miners lighting fuses to blast ore in a stope 900 feet under the Mine drainage is covered under a Cu at the start. By 1964, the pit was Butte Post Office, Steward Mine, ca 1897 (courtesy of World 1994 sub-agreement between the three providing 56 per cent of the total Museum of Mining, Butte, Montana) parties, as well as Montana Resources, production. The smaller that defines how the mine water will Continental pit, on the east edge of the deposit, was started be managed to prevent contamination. Throughout the life of in 1980; when it closed in 1983, production by Anaconda the mine, pumps were used to dewater the underground workand its successors ended. ings and, later, the Berkeley and Continental pits. When minIn 1971, Anaconda suffered a crippling blow when Chile ing ceased in 1983, the underground workings began to fill nationalized its great Chuquicamata mine, its primary with acidic, metal-rich water. The Berkeley pit now serves as a source of income. When copper prices weakened again, the surface sump, where all the mine water and surface runoff in Butte operation was gradually forced to shrink. By 1976, the vicinity is collected. Between 1982 and March 2008, the Anaconda had become so financially weak that Atlantic water level had risen about 1,000 metres from the deepest part Richfield Oil Ltd. (ARCO) bought it for $162 million, partly of the mine, to an elevation of about 1,730 metres above sea for its tax-loss credits. level. It continues to rise at a rate of about 1.5 centimetres per At the end of 1985, Washington Corp., a construction month and is expected to reach a maximum height of 1,770 company based in Missoula, purchased the entire operation metres around the year 2021. A water treatment plant now from ARCO for $17 million and reopened the Continental pit handles some overflow and it will be enlarged as the pit fills in mid-1986 under a new name, Montana Resources. In 1989, up. The plant will strip out copper and perhaps other metals ASARCO purchased a 49 per cent interest. The pit operated that can be marketed to help defray the costs, return sludge until 2000 and again from 2003 until 2008. It is a private containing contaminants to the abandoned mine, and release company and production information is not available. clean water into the drainage system (Pitwatch, 2008; The Butte, which was once the largest city between Seattle Berkeley Pit Public Education Committee, 2008). CIM and Minneapolis with a peak population of 115,000 in References 1917, has now stabilized at about 30,000. In 1966, it was designated a National Landmark District, including the EPA Superfund Information. (2009). Retrieved May 17, from http://www.anacondadeerlodge.mt.gov/super/info.aspx and http://www.epa.gov/region8/superfund/mt/anaconda/ headframes, waste dumps and its historic buildings. It is index.html home to Montana Tech of the University of Montana and Graton, L.C. (1947). Seventy-five years of progress in mining geology. In A.B. Parsons (Ed.), the World Museum of Mining. Until 1994, Montana Tech, Seventy-five years of progress in the mineral industry: 1871-1946 (pp. 14-16). New York: The American Institute of Mining and Metallurgical Engineers. founded in 1893, was known as Montana School of Mines.

Reclamation Throughout the first 75 years of the Butte operation, terms such as “acid mine drainage,” “environmental hazard’” or even “reclamation” had not been invented or applied to mining. As a result, the damage associated with the crude treatment facilities and the world’s tallest freestanding brick chimney (192 metres), which distributed contamination from metals such as arsenic, lead, cadmium, copper and zinc over a vast area and for a long distance downstream, suddenly became a serious environmental concern. As the operation neared closure in 1983, the U.S. Environmental Protection Agency (EPA)

Linforth, F.A. (1933). Application of geology to mining in the ore deposits at Butte, Montana. In W. Lindgren (Ed.), Ore deposits of the Western States (pp. 695-701). New York: The American Institute of Mining and Metallurgical Engineers. Long, K.R., DeYoung, J.H. Jr., & Ludington, S. (2000). Significant deposits of gold, silver, copper, lead, and zinc. Economic Geology, 95, 629-644. McLaughlin, D.H. & Sales, R.H. (1933). Utilization of geology by mining companies. In W. Lindgren (Ed.), Ore deposits of the Western States (pp. 683-694). New York: The American Institute of Mining and Metallurgical Engineers. Perry, V.D. & Meyer, C. (1968). Reno H. Sales. In Ridge, J.D. (Ed.), Ore deposits of the United States: 1933-1967: the Graton-Sales Volume (pp. xx-xxiii). New York: The American Institute of Mining, Metallurgical, and Petroleum Engineers Inc. The Berkeley Pit Public Education Committee. 25 years since pumps stopped. (2008). Retrieved July 6, 2008, from http://www.pitwatch.org Sales, R. (1913). Ore deposits at Butte, Montana. American Institute of Mining and Metallurgical Engineers, Transactions, 46, 1523-1626.

August 2009 | 75

metallurgy The gold rush in Tierra del Fuego By Fathi Habashi, Department of Mining, Metallurgical, and Materials Engineering, Laval University

The land of fire The name of the Tierra del Fuego Giacomo Bove had mounted preparaarchipelago, located near the southtory expedition aimed at drawing up ern tip of South America, means plans for a later Italian Antarctic expe“Land of Fire” in Spanish. The name dition. One of his men gathered a dates back to when the Portuguese curious “black sand” from a beach in explorer, Ferdinand Magellan, the region. Later, in 1885, the goverbecame the first European to visit nor of Ushuaia learned about the sand these lands in 1520. He believed he and was so intrigued by its description was seeing many fires (fuego in that he sent a ship in search of more Spanish) that the Amerindians had lit of the material. When the news spread for protection against the low temperthat the black sand contained gold, a atures in the area. torrent of people poured into the area. The territory of Tierra del Fuego is A short-lived gold baron divided between Argentina and Chile. In 1885, the Romanian-born Julius Located on the Magellan Strait, Punta Arenas (literally in Spanish, “Sandy Popper (1857-1893), who had studied Point”), is the capital of the Chilean in Paris, arrived in Argentina. In 1886, province, while Ushuaia is the capital Julius Popper (1857-1893) he settled down in Rio Grande with a number of workers and a small miliof the Argentinean province. Until the opening of the Panama Canal in 1914, Punta Arenas tia. There, he launched a campaign of extermination enjoyed economic prosperity as a ship supply facility serv- against the area’s indigenous peoples. Over the course of his three-year campaign, Popper was able to extract 173 icing vessels that had to go around Cape Horn. kilograms of gold. An eminent visitor A dynamic and well-connected man with excellent relaCharles Darwin (1809-1882), who was hired as a natu- tions in Buenos Aires, Popper minted his own gold coins in ralist for the British Navy research ship HMS Beagle, the Casa de la Moneda of Buenos Aires and even issued his stayed at Tierra del Fuego from March 1832 to February own stamps for use in his fiefdom, Colonia Popper. 1833 and again from January to June 1834. Incidentally, it Popper’s 1887 lecture at the Argentine Geographical was during this period, in 1833, that the Institute in Buenos Aires, that revealed Falkland Islands were claimed by the the depth of his scholarship, was British Crown. Darwin spent his time printed and widely circulated. It is on land exploring and taking notes for now available on the intent his 1839 book, The Voyage of the (http://tinyurl.com/ksjxle). After his Beagle. This detailed scientific journal sudden death in Buenos Aires at the covered topics as diverse as biology, age of 35, his empire collapsed. It is geology and anthropology. believed that he was assassinated in Darwin’s contact with Fuegians his hotel room. A five-gram gold coin minted by Popper had a tremendous influence on the The history and heritage of Fuegian development of his later ideas on evoculture, including the region’s tryst lution, which were elaborated in his famed volumes, On with gold, are now conserved at the Museo del Fin del the Origin of Species by Means of Natural Selection and The Mundo which was founded in Ushuaia in 1979. CIM Descent of Man, and Selection in Relation to Sex, in 1859 and 1871, respectively.