CIM Magazine September/October 2008

Publications Mail No. 40062547

Sept/Oct • sept/oct 2008

www.cim.org

CONTENTS CIM MAGAZINE | SEPTEMBER/OCTOBER 2008 SEPTEMBRE/OCTOBRE

NEWS 10

Looking to the future: the Kearl oil sands project Imperial Oil and ExxonMobil

20

outlay will deepen the mine to 9,500 feet, adding a year to its life by M. Kerawala

implement the first of three phases at Kearl

by M. Eisner

12

Saskatchewan – the new frontier

22

Alloyed adornment, unalloyed valour NRCan leads the development of Canada’s very own Victoria Cross by M. Kerawala

18

24

Providing mine scheduling solutions The XPAC AutoScheduler helps Petro-Canada meet targets at the Fort Hills mining project

New neighbourhoods of opportunity The Government of Alberta and the Wood Buffalo Regional Municipality to develop two new communities in Fort McMurray.

The stingiest project in the West?

GE Water and Process Technologies enable the Algar Oil Sands project to recycle and conserve water by M. Kerawala

Oilsands Quest spearheads the province’s sunrise oil sands industry by M. Kerawala 16

Xstrata Copper to extend Kidd mine with fresh investment A $121 million

by M. Sabourin

27

20

Carbon dioxide… R.I.P. An interview with Jim Carter, president of the Alberta Carbon Capture and Storage Development Council

by B. Sundararajan

61 COAL AND OIL SANDS CHARBON ET SABLES BITUMINEUX 30 37

41

Burning desires An overview of Canada’s sizzling coal industry by D. Zlotnikov The strongest links From hinterland to coast and beyond, Canada’s coal chain is a marvel of coordination and partnership by E. Moore Greening coal Canada’s coal industry is rising to the challenge of sustainability aided by cuttingedge technology by B. Sundararajan

45 51

54

2020 Vision A look into the future of Canadian oil sands by D. Zlotnikov Wells to Wheels Petro-Canada’s integrated approach means that it is involved in the entire oil sands value chain by P. Symons One, two, three… green light The Athabasca River gets a hand from some innovative water management strategies

by B. Berzins and B. Irvine

4 | CIM Magazine | Vol. 3, No. 6

58

Partners in growth A look at the challenges and opportunities for third-party contractors in the oil sands industry by R. Ruston

62

64

Le charbon canadien, c’est « hot » Une étude de l’industrie houillère dynamique du Canada Une vision 2020 Un regard sur l'avenir de l'industrie des sables bitumineux du Canada

COLUMNS 66 68 70 72 74 75 76 77 78 80 81 126

83

Innovation Page by M. Parsons Eye on Business by J. Vercoe Student Life by R. Ritter HR Outlook by M. Sturk Standards by W.E. Roscoe and D. McCombe The Supply Side by J. Baird First Nations by J.C. Reyes MAC Economic Commentary by P. Stothart Safety by C. Hersey Parlons-en par S. Perrault Mining Lore by D. Zlotnikov Voices from Industry by B. Payne

CIM NEWS 99

FEATURED MINES

learning

MINES EN VEDETTE 83

100

From guts to glory How Chris Ryan and his

101

Rendezvous by the lake The Mining Society

team revitalized CIM’s Crowsnest Branch by R. Pillo

Full steam ahead Suncor pushes the envelope at the Firebag in situ project for projected production of 370,000 barrels per day

of Nova Scotia holds its 121st AGM on the shores of the Bras d’Or lakes in Cape Breton

by D. Zlotnikov

87

Feeding a fierce demand Western

91

Canadian Coal Corporation expands and innovates to ambitiously boost production at its Wolverine mine by D. Zlotnikov Answering a towering need The Athabasca Oil Sands Project Expansion 1 is among the largest oil and gas construction projects in North America by M. Sabourin

CIM Environmental Society web meetings Fostering sustainability through online

103

First annual meeting a huge success The newly reconvened CIM North Central BC Branch hosts its first AGM in over five years

by R. Pillo

106

87

Symposium 2008 sur l’environnement et les mines du 2 au 5 novembre 2008 / The Symposium 2008 on Mines and the Environment November 2 to 5, 2008.

Rouyn-Noranda, Québec

95

À pleine vapeur Suncor utilise des méthodes

96

novatrices de technologie et de recrutement pour son projet Firebag Agrandissement de Wolverine L'expansion et l'innovation permettent à Western Canadian Coal Corporation d’accroître la production à sa mine de Wolverine

97

HISTORY 113

Homestake, South Dakota (Part 2)

by R.J. Cathro

116

Migration and movement of scholars (Part 6) by F. Habashi

Répondre à un besoin pressant Le Projet 1 d'expansion dans les sables bitumineux de l'Athabasca

TECHNICAL SECTION 119

91

IN EVERY ISSUE

Programme préliminaire | Preliminary program

6 8 98 105 123 124

Hôtel Gouverneur Noranda, Rouyn-Noranda, Québec du 2 au 5 novembre 2008 | November 2 to 5, 2008

This month’s contents

106

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

Editor-in-chief Heather Ednie hednie@cim.org Section Editors News and Features: Angie 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

Resounding examples of ingenuity his year’s special Coal and Oil Sands issue of CIM Magazine is the best one yet, with major involvement of people throughout those thriving industries. There’s no doubt about it — the soaring times for Canadian coal and oil sands production haven’t even begun to touch their brakes. Reading through the numerous articles in this issue, covering many different companies and their people, one point is clear: these industries are resounding examples of ingenuity and forward thinking.

It seems that no matter what is thrown at them, the people driving these industries find innovative solutions to their challenges. There’s no bowing down to adversity; rather a steely will to determine the best course of action shapes their progress. Take the continuing human resources challenges — throughout this issue there is example after example of companies pursuing out-of-the-box ideas to meet their needs.

Cleverness isn’t relegated to coal and oil sands alone — our minerals industry is chock full of it, as we tackle technology, environmental and social issues to meet our production requirements. This issue highlights a number of prime examples of resourceful efforts, from clean coal technologies to new developments for in situ mining. And the abundant examples of innovation amidst the booming times make the coal and oil sands industries highly exciting — so enjoy this issue as you learn about some of the hottest projects and developments underway.

T

Contributors Jon Baird, Bill Berzins, R.J. Cathro, Marlene Eisner, Fathi Habashi, Carolyn Hersey, Bill Irvine, Deborah McCombe, Eavan Moore, Mike Parsons, Boyd Payne, Serge Perrault, Robbie Pillo, J.C. Reyes, Robert Ritter, William E. Roscoe, Rodney Ruston, Michelle Sabourin, Paul Stothart, Melanie Sturk, Binod Sundararajan, Peter Symons, John Vercoe, Dan Zlotnikov 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 ($140.00); 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

Heather Ednie Editor-in-chief This month’s cover A heavy hauler at work in the oil sands.

Photo courtesy of North American Construction Group.

Layout and design by Clò Communications.

Copyright©2008. 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. 3, No. 6

president’s notes Feel the energy!

This issue is all about energy and the associated participation of the mining industry towards driving strategic and meaningful efficiencies. Canada is the world’s leader in oil sands development and production, and a significant producer of coal. With the many challenges facing our society regarding energy requirements, the mining industry is stepping up — and in a sustainable manner!

Where does CIM fit in? The organization is front and centre, providing the opportunities for our members to network and share the knowledge that will help us to meet these challenges head-on.

Another type of energy that is of great importance to the industry is people power. The growing shortage of skilled labourers remains one of the most significant challenges facing not only the coal and oil sands industries, but the mining sector as a whole. CIM is focused on proactively addressing this issue by providing opportunities that attract young people to our industry. This is being accomplished by means of our student memberships, branch activities and the scholarship programs offered through the CIM Foundation, as well as from the various branches and societies.

Calling all students! I encourage you to contact our CIM national office and inquire about how to take advantage of the financial resources the organization has to offer.

Calling all members! CIM is also working with MiHR to provide mentors for young people in our industry.

Members, I also encourage those of you who are interested to get in touch with the national office for more information about this positive program.

Let’s keep that critical flow of energy going that can only be provided by young people entering our industry.

Best regards, Jim Gowans CIM President

Que d’énergies!

Chers membres, Cette édition du Magazine est entièrement consacrée à l’énergie et à la participation de l’industrie minière dans l’établissement de stratégies et de compétences concrètes.

Le Canada est le leader mondial dans le développement des sables bitumineux et il est un important producteur de charbon. Avec les nombreux défis auxquels notre société est confrontée en ce qui concerne les besoins énergétiques, l’industrie minière se surpasse – et ce, de manière durable!

Quel est le rôle de l’ICM dans tout cela? L’organisation est à l’avant-plan, fournissant des occasions pour permettre à nos membres d’établir des contacts et de partager les connaissances qui nous aideront à faire face à ces défis.

L’industrie reconnaît aussi l’importance de l’énergie représentée par le pouvoir des employés. La pénurie croissante de travailleurs qualifiés demeure l’un des défis les plus considérables non seulement des industries du pétrole et des sables bitumineux mais aussi du secteur minier dans son ensemble. L’ICM veut adresser cette question de manière proactive en établissant des possibilités pour attirer les jeunes gens dans notre industrie. Pour ce faire, nous avons les mem-

8 | CIM Magazine | Vol. 3, No. 6

bres étudiants, les activités des sections et les programmes de bourses offertes par la Fondation de l’ICM ainsi que par diverses sections et sociétés.

Appel à tous les étudiants! Je vous encourage à contacter le bureau national de l’ICM et à vous informer comment bénéficier des ressources financières offertes par l’organisation.

Appel à tous les membres! L’ICM travaille aussi de concert avec le Conseil des ressources humaines de l’industrie minière (RHiM) afin de fournir des mentors pour les jeunes gens dans notre industrie. J’encourage aussi les membres intéressés à contacter le bureau national pour plus d’information sur ce programme très positif.

Conservons ce flux d’énergie cruciale que seuls les jeunes qui entrent dans notre industrie peuvent fournir.

Meilleures salutations, Jim Gowans Président de l’ICM

Photo taken by Gary Mulcahy

Dear Members,

news Looking to the future: the Kearl oil sands project Kearl is a potential oil sands mining and extraction project located in Alberta, proposed by Imperial Oil Resources Ventures Limited (Imperial Oil) and ExxonMobil Canada Properties (ExxonMobil Canada). Its overall design will be similar to existing oil sands mines in the Fort McMurray region.

At the CIM Conference and Exhibition held in Edmonton last May, the Kearl project was showcased during the technical program. Coauthor of the presentation, Gord Winkel, oil sands technology manager on the project, provided some highlights of the project. Winkel said the company is currently at the frontend of engineering and design for the first phase of this three-phase development that is projecting about 100,000 barrels per day for each of the three phases. The target over the life of the project is approximately four billion barrels.

Winkel described Kearl as a highquality mine. “The oil sands have an average oil sand grade of greater than 12 per cent bitumen, with ore thickness of 40 metres and overburdened thickness of 21 metres on average,” he explained. “This makes it a highquality ore body for mining.”

According to the company’s regulatory application, filed in 2005, the open-pit mine will likely involve an initial mine development of about 100,000 barrels a day, with two additional phases in later years. Work is curby Marlene Eisner rently underway at Imperial to gather information that will help with a final decision on whether or not to proceed with the project. That decision is expected later this year or early in 2009. The company has committed to providing a revised cost and schedule estimate once that decision has been made.

“The base mine will be developed in a staged approach,” said Winkel.

10 | CIM Magazine | Vol. 3, No. 6

“The initial mine development — the first train — will involve clearing and draining the surface area, removing muskeg and overburden to expose the oil sands for mining, and stockpiling the muskeg for use in future reclamation.”

On the mining side, the technology will be truck-and-shovel-based, including electric cable and dieselpowered hydraulic shovels. There will be a delivery of up to 100 tonnes per pass every dig cycle using the ultra class trucks with 400-tonne capacity. It will employ a double truck dump receiving hopper, double-roll crusher and surge bin, for steady delivery of oil sands to a slurry preparation plant.

The slurry prep plant employs a mix-box technology, vibrating screens and secondary reject crushing and processing. It will also employ hydrotransport technology that delivers oils sands slurry to extraction and prepares the slurry for the separation process. The project uses current oil sands mining experience, as well as a number of design modifications for improved performance. It also uses a low-energy extraction process for improved environmental performance and a hightemperature paraffinic froth treatment process that will produce a clean, dry bitumen product that will meet pipeline specification and marketability requirements without the need for additional upgrading.

The process tailings will be stored in interim containment facilities and transferred back into the mining pit in the form of consolidated tailings when space becomes available, which facilitates progressive reclamation of disturbed areas.

While the potential of the mine is exciting, Winkel said one of the most important aspects of this oil sands project is ensuring the health and safety of its employees, the local community and the general public in an environmentally responsible manner.

“We’re also trying to reward superior performance and promote a culture of learning and innovation,” said Winkel. “We encourage teamwork and collaboration. We work to remove barriers to productivity by providing clear expectations, respect for individuals and an adherence to the highest standards of ethics and integrity.”

Winkel cited a specific platform and planning base that supports a philosophy for a successful project, one that respects the environment and culture, through the execution of priorities, safety and environmental protection. The goal is to deliver the project on budget, remain on schedule for the construction and commissioning of facilities, and ramping up to targeted production levels as per plan.

“So now you have a bit of a flavour of what the resource is, what it looks like, the project goals and underpinnings,” concluded Winkel. “There it is, from pipe to endpoint.” CIM

Achievements This past June, Wesdome Gold Mines achieved an important milestone, pouring its millionth ounce of bullion. Directors, officers, investors and local dignitaries celebrated the event with a ceremony, site visit and underground tour at the company’s Eagle River mine near Wawa. Since it began in 1987, Wesdome has put five gold mines into production and assembled strategic property and mining infrastructure in Val-d’Or, Quebec, and Wawa, Ontario.

Currently, Wesdome operates three gold mines – Eagle River, the Mishi mine and the Kiena mine in Val-d’Or.

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news Saskatchewan — the new frontier Oilsands Quest spearheads the province’s sunrise oil sands industry What is Saskatchewan known for?

Pioneering public healthcare? Yes, but hardly a concern of this magazine. Wheat? True, but again, of little interest here. Potash and uranium?

Bingo. How about oil sands? If your answer was no, you might just want to reserve judgment. Because while neighbouring Alberta is the oil sands capital of Canada, things are also stirring in the Land of Living Skies. An oil sands boom is dawning in Saskatchewan and one company is quickly taking on the role of modernday frontiersman, opening up new vistas of development.

A new frontiersman This pioneering company is Oilsands Quest Inc. Founded with a belief in the prospects of oil sands in Saskatchewan, the company, since late 2004, has focused on extending the known boundaries of viable deposits in the Athabasca area and is conducting the first major oil sands exploration in the province’s history.

Oilsands Quest’s strategic advantage comes from its possession of Canada’s largest contiguous oil sands holdings, including 730,598 acres of permits and licenses in the Athabasca region. The company also holds a 22,773-acre oil sands lease northwest of Fort McMurray, Alberta, and over 489,000 acres of oil shale permits in Saskatchewan’s Pasquia Hills.

by Minaz Kerawala

Thinking outside the lines

The simple idea that provincial borders cannot constrain geology underpins Oilsands Quest’s success.

CEO Christopher Hopkins and his team were convinced that Saskatchewan held a basin edge play.

Launched in December 2005 and led

by Errin Kimball, vice president of exploration, and Simon Raven, chief geologist, Oilsands Quest’s first 12 | CIM Magazine | Vol. 3, No. 6

Well drilling and completion operations at test site No. 1.

drilling program was modest — just 25 holes. In January 2006, the first hole intersected 18 metres of McMurray formation at 16 per cent bitumen saturation. Within a year, the area was designated the Axe Lake Discovery. The sun had risen on Saskatchewan’s oil sands industry.

Kimball conceded that Oilsands Quest can’t take credit for the discovery. “We had reviewed Saskatchewan Energy Resources records from legacy drilling by Shell and Gulf in the early 1970s that noted bitumen intercepts,” he recollected. “We applied that information to our geological framework and developed a depositional model that was consistent with other viable oil sands deposits in the area,” he continued, explaining the masterstroke. Effectively, the company simply took its existing expertise to new grounds. “As Hopkins likes to say,

‘when you’re in the bitumen, stay in the bitumen,’” Raven added with a chuckle.

However, it was not all chuckles from the outset. “It took us three years to gather the data to prove what we knew all along,” recalled Kimball. By the end of the winter 2007-08 drilling season, Oilsands Quest had drilled 324 holes in Saskatchewan, including 264 at Axe Lake and another 25 on contiguous lands on the Alberta side of the border. This drilling resulted in the Raven Ridge Discovery, which is on trend with Axe Lake and a number of projects in Alberta.

Their sheer doggedness paid off. According to independent estimates by McDaniel & Associates Consultants Ltd. in June 2008, Axe Lake holds a high estimate (P10) of 2.3 billion barrels of discovered bitu-

news the Alberta side — at Raven Ridge and Wallace Creek — hold the possibility of more. Discovered and undiscovered bitumen resources at Axe Lake and Raven Ridge are independently estimated at 6.5 billion barrels (high estimate). As the first major discovery, Axe Lake is likely to become Saskatchewan’s first oil sands project.

Exciting times ahead

Open year-round, Oilsands Quest's base camp includes an airstrip and has housed over 400 workers at the peak of explorations.

men resources. Kimball and his colleagues are confident the resource numbers will keep growing. “We

believe Axe Lake has the potential for multiple projects,” said Kimball, adding that contiguous holdings on

The Axe Lake deposits contain homogenous, continuous, coarsegrained bitumen-rich oil sands, with good porosity and permeability and excellent bitumen saturation. They are located in the McMurray oil sands formation with average pay zones of over 20 metres at depths suitable for in situ recovery. To determine the most effective methods of in situ recovery, Oilsands Quest will commence a program of reservoir field tests this fall at one of three test

September/October 2008 | 13

news sites, confident that testing will result in a formal declaration of commercialization.

The company is currently assessing a fast-track approach to a potential commercial project, and in June 2008 announced the initiation of engineering plans for its first 30,000 barrel per day production facility. It is projected that Saskatchewan’s first oil sands project could be completed in 2012 or 2013. Meanwhile, exploration continues apace on the huge contiguous holding, over 95 per cent of which remains to be drilled.

While year one was spent proving the existence of bitumen deposits and year two was spent scouring the border to determine where to go next, Axe Lake was the focus in year three. “In years four and five, we will continue with delineation of Axe Lake and with exploration on the rest of our contiguous holdings,” Kimball declared.

Meeting the challenges Too experienced to rest on early laurels, Kimball and Raven are fully cognizant of challenges, the greatest of which is posed by the remoteness of the holdings.

Infrastructure is thin in northwestern Saskatchewan.

From Oilsands Quest’s base camp, the nearest large community is the northern village of La Loche, 185 kilometres away. “We started building site infrastructure, With over 40 years of engineering experience, IEM offers a complete range of Bulk Materials Handling Equipment for the Mining Industry Apron Feeders -- Belt Feeders -- Belt Conveyors -- Belt Trippers -- Ball Handling Systems -- High Angle Conveyors

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including our main access road, in November 2005 and, since then, we’ve built an airstrip,” Raven recounted.

“There’s no power to our site, so our camps are totally self-sufficient.”

Another challenge arose because, unlike in Alberta, the oil sands industry is a new development in Saskatchewan.

Kimball recalled, “At first, the regulatory approval process was a little slow.” However, he added, “the process and timelines have improved considerably. The provincial government is easy to work with and everyone is following our progress with interest.”

Additionally, Oilsands Quest faces the scrutiny of Saskatchewan’s people, who have no prior experience of sharing social, cultural and economic space with an oil sands operator. But the company sees this as an opportunity. The company has conducted province-wide public information campaigns, primarily by advertising in dailies, community newspapers and trade publications. Senior personnel have also addressed organizations like chambers of commerce and rotary clubs in several cities and participated in regional economic development conferences and workshops.

The company has regularly held open houses and participated in high school career fairs. Oilsands Quest has been realistic about the prospects and responsible about managing public expectations. At career fairs, company personnel explain the lead times and the types of careers and encourage students to follow educational routes that can help secure industry jobs. Two dedicated community liaison personnel are stationed at La Loche.

Beyond building infrastructure, securing regulatory approval and forging community ties, Oilsands Quest ultimately relies on its people. “Our colleagues have significant experience with other oil sands exploration projects,” noted Kimball, explaining that members of the core management team were part of the original operations group for Synenco’s Northern Lights Project. “Now, as the company moves into development, we are adding people with extensive experience in reservoir engineering and production.

With this influx of new talent and continued progress on development plans, Saskatchewan is all set to take its place next to Alberta as a significant oil sands producer in Canada. CIM

Movin’ on up 109-19433 96th Avenue, Surrey, BC V4N 4C4, Canada Tel: 604-513-9930 Fax: 604-513-9905 E-mail: conveyors @ iem.ca Visit our website www.iem.ca for more information

14 | CIM Magazine | Vol. 3, No. 6

Golder Associates Ltd. recently expanded its leadership team to include three prairie mining leaders. Leon C. Botham and Laurent F. Gareau were honoured with the distinction of principal, and Eric Hinton with the distinction of associate, as a reflection of their accomplishments in mine engineering and in driving Golder’s mining industry services across the prairies and around the world.

How well do you know your heavy oil reservoir?

Make heavy oil more predictable.

Improve your inputs to understand the full picture.

Challenge conventional views—join the debate.

Visit us at Booth 2400 at the Oil Sands Trade Show and Conference, Edmonton, September 23–24, 2008.

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© 2008 Schlumberger. 08-OF-155

news Alloyed adornment, unalloyed valour From dreaded damascene swords and storied samurai blades to the marvels of modern military technology, metals have played a frontline role in warfare. And then there is another, quieter role for metals, as the material for medals and decorations bestowed upon soldiers. The highest honour that Canadian soldiers can aspire to is the Victoria Cross.

Introduced in 1856 by Queen Victoria, the Victoria Cross was reputedly cast from a Russian cannon captured during the Crimean War. Since it was extended to colonial troops in 1867, 94 Canadians have received the medal. In 1993, Her Majesty Queen Elizabeth II approved a Canadian version of the Victoria Cross.

Since then, much thought went into making the new Canadian medal distinct from the British original without straying too far from its rich heritage. After years of research, discussion, consultation and redesigning, the Canadian Victoria Cross was finally unveiled in Ottawa on May 16, 2008

by Michaëlle Jean, Governor General of Canada.

“It was one of those beautiful projects,” recalled John Udd, principal scientist, Minerals and Metals Sector at Natural Resources Canada (NRCan).

“It involved Canadian Heritage, the Department of National Defence, Veteran Affairs Canada, the Canadian War Museum and the Royal Canadian Mint,

by Minaz Kerawala among others.”

To celebrate the shared linguistic heritage of Canada’s two official languages, the motto on the insignia in the new medal was changed from the English “For Valour” to the Latin “Pro Valore.” Fleurs-de-lis were also added at either end of the scroll bearing the motto.

However, it is its substance that makes the medal truly Canadian. “A 16 | CIM Magazine | Vol. 3, No. 6

Photo by David Ashe, Natural Resources Canada

Canada’s Victoria Cross is the product of modern metallurgical ingenuity and centuries-old tradition

Canada's new Victoria Cross

recipe was decided upon that was different than anything that had been done before,” reported John Dutrizac, a research scientist at CANMET, who headed the team researching the alloy for the medal. “We then set out to acquire the metals, including metal from a cannon captured by the British during the Crimean War and a Canadian Confederation medal from 1867. We obtained copper native to Canada from a variety of sources in every region: the Arctic, Northwest Territories, Yukon, British Columbia,

the Prairies, Ontario, Quebec and Atlantic Canada.”

Peter Newcombe, senior research technologist at NRCan said: “Our main role was to ensure the consistent production of a highly detailed medal that would react well with the applied patina and last over time.” In the interest of relief and detail, the medal was to be cast and not diestruck. The Experimental Casting Laboratory made wax replicas of the cross and suspender bars and poured a ceramic mixture around them to form moulds. Molten alloy was poured into the de-waxed and fired moulds to produce castings that were then trimmed by precision wire electrical discharge machining. The medals were then hand-chased by the Royal Canadian Mint and given a patina to protect and colour the surface. Finished medals were sent to the Department of National Defence for final mounting.

Speaking at the unveiling of the new Victoria Cross, Prime Minister Stephen Harper said, “The medal will be a proud reminder of our unity and our heritage and of the sacrifices that have helped keep our True North strong and free. It will serve as an inspiration to future generations.” CIM

Giving Back Caring for kids In the spirit of community service, Elk Valley Coal’s employees raised $225,000 during the month-long Caring for Kids 2008 campaign. To bolster their contribution, the company matched the amount raised dollar-for-dollar, bringing the total to $450,000. Since it began in 1996, Caring for Kids, the company’s primary corporate fundraising program, has raised over $1.6 million to help finance world-class child health services, the purchase of specialized equipment and advanced paediatric research. This year, the campaign helped fund the purchase of specialized pediatric surgery equipment at the Alberta Children’s Hospital.

Your diamond in the rough – the new force in dewatering from Flygt Tough conditions call for tough solutions. And that’s Flygt’s 2600 dewatering pump series in a nutshell.

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To find out more go to www.ittwww.ca

news New neighbourhoods of opportunity

Moving on up

As part of its long-term strategic plan for the oil sands, the government of Alberta is partnering with the Wood Buffalo Regional Municipality and various local groups to develop two new communities in Fort McMurray. The new townships at Parsons Creek and Saline Creek Plateau will house 40,000 people on 4,000 acres of land. The holistically planned developments will include schools, health clinics, recreational facilities, parks and other community services. “A project of this magnitude is a significant undertaking, with the end result creating neighbourhoods where people will have homes to raise their families and opportunities to contribute to their community and the province,� noted Lloyd Snelgrove, Treasury Board president.

For Saline Creek Plateau, the government is seeking Expressions of Interest for a world-scale public-private

Mervyn Walker has been appointed group head of human resources at Anglo American.

Currently group Human Resources and Legal Director at Mondi, Walker worked for 19 years with British Airways in senior managerial capacities.

partnership to provide a “master planned� community with comprehensive services, eco-friendly design and reasonably priced housing. The Parsons Creek project will be managed by a community development board with representatives from the Government of Alberta, the Regional Municipality of Wood Buffalo and various local stakeholders. Revenue from the development will be used to support social needs such as affordable housing.

Remarking that the development would help create spaces that Albertans could call home, Housing and Urban Affairs Minister Yvonne Fritz added: “I especially look forward to the affordable housing that will be built here, and all of the services and amenities that will form part of a vibrant Fort McMurray.� Construction will be completed in phases and the first housing will become available in 2010. CIM

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European metals major, Boliden, has appointed Eva Kaijser, currently vice president, investor relations and group communications, to the new position of senior vice president, strategy and business development.

EnCana announced its split into GasCo, a pure-play natural gas company, and IOCo, a fully integrated oil company. David O’Brien will chair GasCo’s board, while Michael Grandin will chair IOCo. Gerry Protti will serve as executive advisor to IOCo. David Buckle and Neil S. Seldon have joined the board of Geodex Minerals Ltd. Buckle is currently executive chairman of PMI Goldcorp. Seldon currently heads Neil S. Seldon and Associates.

Geodex also announced the appointment of Blaine Bailey as CFO. Lukas Marthinus Maree has been appointed a director at Goldsource Mines. Maree has over 20 years’ experience as a mergers and acquisitions lawyer and an investment banker. He is also a director of the River Group.

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Xstrata Copper to extend Kidd mine with fresh investment

Darryl Booth conducts an underground survey at Kidd mine.

Xstrata Copper, the world’s fourth largest copper producer, announced that it will invest $121 million to extend production at the Kidd mine in northern Ontario. The new investment will deepen what is already the world’s deepest zinc and copper mine to 9,500 feet from its current depth of 9,100 feet. It is expected that this will add 3.4 million tonnes of ore to the mine plan and extend the mine life by one year to 2017.

“The investment approval reflects Xstrata Copper’s commitment to the sustainability of Kidd mine and the Timmins community and its business strategy to continually implement improvements to enhance the value of its operations,” said Xstrata Copper Canada’s COO Claude Ferron. He added that the company’s safety record in deep mining and the confidence of employees and the community were instrumental in obtaining approvals.

Construction has begun and will culminate by mid-2010, creating about 75 new full-time jobs for the duration. This is not the first time Kidd mine has received a new lease on life. In 2007 and June 2008, the mining zone was extended to 9,100 feet

by Minaz Kerawala and 9,500 feet, respectively, with additional investments of $148 million.

Kidd mine, near Timmins, Ontario, became operational in 1966. It is part of Xstrata Copper Canada, one of five operating divisions of Xstrata Copper. Together with the Kidd Metallurgical Complex, it employs close to 2,200 employees and contractors. In addition to copper, the new expansion will provide access to fresh deposits of 6.22 per cent zinc, 0.28 per cent lead and 80 grams per tonne of silver. CIM 20 | CIM Magazine | Vol. 3, No. 6

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news The stingiest project in the West?

Ordinarily, no modern industrial operation wants to be known for stinginess. But the

by Minaz Kerawala Algar Oil Sands

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Project operator Great Divide Oil Sands Partnership, an affiliate of Connacher Oil and Gas Ltd., has selected GE Water and Process Technologies’ water evaporator and zero liquid discharge (ZLD) system to dramatically cut water usage and protect regional water resources.

The new two-stage evaporation process deployed at the Algar project uses successive evaporation, crystallization and drying processes to separate clean water from impurities. The clean water is then reused to make high-purity steam for bitumen extraction, while impurities are reduced to dry solids. The system recycles up to 98 per cent of the water recovered from the steam-assisted gravity drainage (SAGD) bitumen extraction process and eliminates all wastewater discharge to the environment. It also allows the use of lower quality, brackish water sources for makeup water.

The process is expected to reduce electricity demand by as much as 25 per cent and significantly decrease plant size, compared to previous configurations. The use of standard drum boilers to produce steam also cuts natural gas consumption by five per cent over conventional oncethrough steam generators.

The system will treat up to 1,000 gallons of produced water per minute at the Algar site, and will decrease makeup water requirements by more than 200,000 gallons per day. Because nearly all of the water recovered from the extraction process is reused, wastewater discharge to the environment will be eliminated by an equivalent amount.

Annual water savings of up to 73 million gallons will go a long way towards helping to diminish the project’s carbon and water footprints. CIM

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news Providing mine scheduling solutions The Fort Hills lease, located on the east side of the Athabasca River, is one of the largest undeveloped oil sands leases left in northern Alberta.

The Fort Hills mining project, which is a partnership between Petro-Canada (60 per cent), UTS Energy Corporation (20 per cent) and Teck Cominco Limited (20 per cent), is anticipated to produce 165,000 barrels of recovered bitumen a day, with a mine life expectancy of about 80 years.

In 2006, Petro-Canada Oil Sands Inc., which is responsible for the lead development as well as the operation of the project, drafted

by Michelle Sabourin some plans for the mine. At that time, only three major mining scenarios could be

generated due to existing time limits and the lengthy process that is inherent to manual scheduling.

Consequently, Petro-Canada began to review some software packages in order to optimize their future mine planning and scheduling.

After careful consideration, they chose the XPAC AutoScheduler software application, which was developed by the international mining consultancy company Runge Mining Ltd.

Manual scheduling versus the XPAC AutoScheduler When manually producing a schedule for a mine, the user personally selects the order in which blocks of material will be extracted. Once this schedule is

complete, results are analyzed to see if corporate objectives for the mine are met. If not, the user goes back and adjusts the order in which the blocks are mined and tries again. The process is iterative and very time-consuming. In the case of the Fort Hills project, approximately one to three weeks were required to manually generate each new schedule.

Comparatively, Runge Mining’s XPAC AutoScheduler software enables multiple planning and scheduling scenarios to be created in a very short period of time — mere minutes, in fact. The scheduling process is not completely automatic, as some manual input is still required from the user, but the procedure is far simpler.

Auto-scheduling in an oil sands deposit Option 1 - Maximize Grade Option

Option 2 - Minimize Grade Option

Two autoscheduling scenerios in a generic oil sands deposit using the XPAC AutoScheduler software.

24 | CIM Magazine | Vol. 3, No. 6

news order for the blocks to be mined • First the user imports geological that will aim to meet the targets quantities and qualities into and objectives, while respecting XPAC. the rules and constraints that were • Next they identify the “rules” and previously defined. “constraints” of the mining operAs explained by Fraser Rowe, ation and enter them into the manager of North American program. These can include, but Operations at Runge Mining Ltd., it are not limited to: general relais not a situation where you can simtionships about how blocks are ply push a button and obtain your mined (for example, no undersolution.

“But what it does enable ground mining); the exclusion of you to do,” said Rowe, “is look at a blocks outside geological boundlot of scenarios very quickly, which aries; and restriction of mined you would never be able to do with quantities in certain scheduling manual scheduling, and then you periods. can determine the two or three • Next, the user enters the targets and/or corporate objectives for the schedules that you wish to pursue in mine. These can include financial more detail.”

In addition to being able to quickly targets, objectives to preferentially mine ore of a certain grade, as well run multiple schedule scenarios, the XPAC AutoScheduler is particularly as other priorities.

• Finally, the XPAC AutoScheduler useful in the planning of mines where 8/26/08 for 3:18:33 PM product blending or complex stockquicklyEmecoCanadanew.pdf produces a schedule the mining operations. It selects an piling is required, or for mines that

have very large data sets. “The software is also applicable to a number of different styles of mining, including underground mining,” added Rowe.

So far, Runge Mining’s XPAC AutoScheduler has had great application — and success — in oil sands projects such as Fort Hills.

Planning and scheduling extractions In May 2007, in order to complete Phase I of their conceptual mine planning, Petro-Canada Oil Sands Inc. requested Runge Mining’s services to help construct and carry out a very specific XPAC AutoScheduler model for the Fort Hills mining project. The goal was to quickly produce as many schedules as possible for the extraction of the material within the Fort Hills deposit and then to choose one that would best suit the corporate objec-

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September/October 2008 | 25

news tives. Multiple scenarios were looked at, such as maximizing or minimizing bitumen grade as a priority in the extraction sequence.

Another variable that was considered when running potential mining schedules through the XPAC AutoScheduler model was the strip ratio. The strip ratio pertains to the amount of overburden that has to be removed in order to attain bitumen deposits below. “Ideally you want to minimize [the stripping ratio],” pointed out Rebecca Jones, mining consultant at Runge Mining Ltd. “But at the end of the day you will still have to move that overburden to get to some of the bitumen deposits; therefore, you want to try and plan for it — that is, when and how you’re going to move it.”

Jones, who has been working closely with Petro-Canada, went on to explain how keeping the strip ratio

fixed during mining operations will, in turn, keep the equipment requirement (the number of loaders needed) fixed.

By taking the strip ratio into consideration when planning an extraction sequence, the need to buy new equipment can be foreseen, which helps meet corporate objectives.

It took the Runge Mining and Petro-Canada team four weeks to set up the XPAC model. Thereafter, the model could successfully produce various scheduling scenarios in mere minutes. Nevertheless, they were faced with a few problems. “Initially, it was a challenge to get the reserve — the material quantity — out of [PetroCanada’s] design package to enter it into XPAC,” explained Jones. “We overcame that problem with the help of the company that was looking after the design package. They worked with us to get the information that we needed for the model.”

Integrating a dump schedule into the existing schedule Currently, as part of Phase II, the Runge Mining and Petro-Canada team are working hard to incorporate dump scheduling into the extraction schedule that was produced during Phase I at Fort Hills. “It’s an order of magnitude higher,” stated Rowe.

“That’s what we do with all our clients — we do the easy bit first, and once we’ve got that right, we get progressively more complex.”

In addition to scheduling and planning the placement of the dump material, the characterization of the haulage requirement is also an integral part of Phase II of the project. Potential uses for the XPAC AutoScheduler model in the future, within the scope of the Fort Hills mining project, could include more complex in-pit/ex-pit dump scheduling as well as tailings dyke construction scheduling. CIM

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news Carbon dioxide... R.I.P. A tête-à-tête with Jim Carter, president of the Alberta Carbon Capture and Storage Development Council tonnes [of captured carbon dioxide] by 2015. This is in support of Alberta’s climate change strategy to reduce emissions by 50 per cent of projected levels by 2050. This translates to a reduction of about 200 megatonnes. It is expected that about 30 per cent of that will come from energy conservation and renewables, and the remaining 70 per cent will come from carbon capture and sequestration.

Jim Carter

With the threat of climate change looming large, two developments have received much attention — clean coal technology and carbon capture and sequestration (CCS). One byproduct of burning coal is carbon dioxide, which can be captured and stored in the vast natural geology of Alberta.

Recognizing the potential of these technologies, the Government of Alberta constituted the Alberta Carbon Capture and Storage Development Council as part of its 2008 climate change strategy. Environment Minister Rob Renner said that the council will match ideas with people who have proven experience in translating ideas into action. One such individual, Jim Carter, the former president and COO of Syncrude, was invited to head the council. CIM Magazine recently spoke to Carter about the council’s mandates, objectives and likely recommenby Binod Sundararajan dations as well as his own ideas and motivations.

CIM: Can we start with the council’s mandate and objectives?

Carter: The mandate is to take action immediately and begin to capture and store carbon in Alberta. What we are trying to do is establish several commercial-level pilot projects that would successfully store about five mega-

CIM: Because this is a goal that needs to be achieved relatively quickly, are there specific actions on the council’s to-do list?

Carter: Well, some of this has already begun. We started meeting as a council, which is comprised of energy industry CEOs, federal and provincial ministers of the environment and members of the

academic community. The Government of Alberta announced on July 9 [2008] that they are going to set aside $2 billion to help fund the council’s projects and get them moving. We intend to make our recommendations by the end of November this year. By the end of the first quarter of next year, the projects will go ahead. The attempt will be to have three to five projects implemented by 2015 and to be capturing five megatonnes [of carbon dioxide], which would then set us on the path to the long-term objective of halving emissions by 2050.

CIM: This is a really quick timeframe. I am sure there are several challenges in the short and long terms.

Carter: We have very energy-intensive industries in Alberta. A lot of our elec-

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news tricity is coal-fired and we have carbon dioxide that results from that.

The objective is to have these industries lend a hand in reducing the carbon footprint by capturing and sequestering carbon dioxide. Alberta in particular is able to do this because we have large sources of carbon that

lend themselves to capturing. As well, we know how to capture and compress gases because we do that a lot here with the natural gas industry. We also know how to pipeline products because we do it all the time. More importantly, we have the geological formation for the storage.

CIM: Are you referring to the Western Sedimentary Basin?

Carter: Yes. The saline aquifers 1.5 to 2 kilometres under the surface of the earth lend themselves to the storage of liquid carbon dioxide. We also have an opportunity, on the revenue generation side, to use the carbon dioxide for oil recovery by injecting it into oil reservoirs. That is a big part of the project. Our intent, where possible, would be to use the captured carbon dioxide for enhanced oil recovery so that we can generate a benefit as well.

CIM: Are there challenges to storing carbon in these aquifers? Has it been done before?

Carter: There is a very large body of knowledge on carbon capture and sequestration around the world. It has been promoted by the inter-governmental panel on the environment, which consists of about 3,000 scientists worldwide. They recognize this as a global opportunity to help reduce the carbon dioxide emissions. We’ve been doing it in Canada for quite some time. The Weyburn Field in southern Saskatchewan has been storing carbon since about 2000. There are approximately seven megatonnes stored there.

A large project has been going on for quite a while in Norway. We understand the conditions under which the storage initiatives have operated and can transfer that knowledge to other aquifers, and the space is available in the geology of Alberta. So, it is not like we are starting out with something completely unknown. It hasn’t really happened in huge volumes; but the idea is to progress to the next level of development, hoping, as we gain experience, that we will get better at it.

CIM: Is that where your experience comes into play?

Carter: Yes. When we started making oil from the oil sands about 30 years ago, there wasn’t a lot of knowledge about that either. We have come a tremendously long way since then in terms of improving the processes, making them more reliable, getting the

28 | CIM Magazine | Vol. 3, No. 6

news costs down and creating a body of knowledge around it. And that same sort of ‘build, analyze, improve’ mentality will eventually lead to better and more cost-effective developments in carbon capture and storage.

CIM: Can you tell us about some of the efforts underway and what we can expect from the council?

Carter: We have structured our council such that we have three working subcommittees. The first examines technological, the second, regulatory and the third, fiscal aspects. The intent is to capture knowledge and make sure that we are guided by it. A lot of the work has been done by the Alberta Energy Research Institute and the Integrated CO2 Network that was established a few years ago in Alberta to look into carbon capture and storage. The objective is to not become technical experts, but rather to look at how we can streamline the process so that action can be taken. The last thing we need is another study that will likely collect dust. What we really need is a bias for action and that’s what you are going to see coming out of this work.

billion — money that’s going to support this challenging issue. There were and are many such national efforts that required this kind of support to get them underway. For example, the drawing of the railroad across the country in the early 1900s, the development of the oil sands initially

and the exploration and drilling for off-shore oil in eastern Canada all required public support. But once they got off the ground, they became items of national importance to the overall Canadian economy and I expect that this [CCS] could very well be one such effort. CIM

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CIM: What were your personal motivations in becoming involved?

Carter: I’d like to see Alberta, and indeed Canada, continue to be able to develop our energy resources. I think this is a key component in enabling that to happen. The broader society and the markets that we produce our energy for have expectations around reducing the environmental impact [of the energy industry]. This is an effort towards doing that. I think it really draws upon a lot of strength in Alberta and the strength of technology to solve these problems. This is true technological development and an effort to make a concrete difference to a challenging issue.

CIM: Do you have any thoughts that you would like to leave our readers with, as they follow the progress of the projects?

Carter: [The Government of] Alberta has announced a commitment of $2 September/October 2008 | 29

Photo courtesy of Canadian National

coal and oil sands

Stockpile shovel and tank cars at Neptune Coal

Canadian coal is hot

by Dan Zlotnikov hen it comes to metallurgical coal, Canada is among the world’s top producers, and it’s not hard to see why. Aside from the country’s extensive coal resources, stable political climate and excellent infrastructure, Canadian miners have the training and experience needed to keep producing coal in a cost-effective fashion while meeting (and frequently surpassing) environmental guidelines. While this has all been true for a number of years, a few additional factors have recently come into play.

Foremost, of course, is the continuing demand for both thermal and metallurgical coal. Met coal has experienced a particularly significant boost in prices, largely due to increased demand for steel from the rapidly developing BRIC countries. Canada’s fortune is also in part due to Australia’s

W

30 | CIM Magazine | Vol. 3, No. 6

misfortune. Recent logistical problems, exacerbated by extreme weather in early 2008, have hampered the Australian coal supply. The result was a sharp leap in coal prices — from under $100 per tonne for coking coal last year to recent highs of over $300 per tonne. The thermal side of the business has also seen an increase — a doubling of prices from around the $50 mark to over $100 per tonne.

Shared challenges Even as the demand for coal burgeons, familiar challenges remain: high costs, long permitting times and tightening environmental regulations. Allen Wright, CEO of the Canadian Coal Association, pointed out that no new coal mines are projected to come online until next year or the year after. Although a number are currently in the permitting

coal and oil sands process, no assumptions can be made about production until approval is granted. Risks and pitfalls can dog a project even after successful permitting. Pierre Gratton, CEO of the Mining Association of British Columbia, identified two recent examples from the BC metals mining world that underscore the issue.

“One major project last year — Northgate Minerals’ Kemess North proposal — did not proceed, in part due to objections raised by the First Nations communities in the area,” said Gratton. The second project Gratton referenced was the Galore Creek mine being developed by NovaGold Resources. Despite successful permitting, the project was put on hold due to rising costs.

Both circumstances are all too familiar to coal producers not only in Canada but the world over, as projects become more difficult, costly and time-consuming to permit and develop.

Permitting: According to Wright, things may be improving on the permitting side in Canada. “The federal government has formed a major projects management office,” he said. The goal, he emphasized, is not to sidestep or change the permitting process, but to make it more straightforward and avoid the duplication of efforts by provincial and federal regulators.

“Currently, the province might go through the process and then the federal government comes in and wants to go through that same process again,”Wright explained. His hope is that streamlining this procedure will allow more projects to receive their permits sooner and take advantage of the coalhungry market — a boon not just for the coal industry but for the Canadian economy as a whole.

Costs: The effect of higher energy prices on most aspects of mining is felt by both producing projects and those under construction. “The price of diesel, natural gas and, to a lesser extent, electricity — those you just have to handle,” said Robert Stan, president and CEO of Grande Cache Coal Corporation.“It’s an added cost, but you just grin and bear it; there’s just not much you can do about it.”

Fortunately, the coal production process is not overly reliant on raw energy inputs, and the high price of the product has successfully offset any added expenses on that front; no coal mine in Canada is likely to be forced to shut down because of the price of diesel. But energy is just one variable affecting operating expense, and the pressure is continuing to build from another indispensible kind of energy — people power.

Staffing: Worldwide, mining operations’ need for more qualified workers is old news. Still, the scale of the problem is not always apparent, and the competition is not limited to mining — many of the skills required are common to various heavy industries. A human resources taskforce created by the MABC has put the province’s need at 15,000 skilled labourers by 2010. The situation is especially dire in Alberta, where the mass of oil sands projects is targeting the same dwindling labour pool and offering salaries that few can match.

Given these pressures, finding qualified staff means using innovative recruitment approaches. In response, a number of coal companies have moved beyond the traditional strategies, with promising results.

“We’ve been actively recruiting in Central and Eastern Canada,” said Stan of Grande Cache’s new hiring practices.

The company has also not been limited by national borders. “We’ve had some success in bringing people in from South Africa, and also just brought in an engineer from New Zealand,” explained Stan, who said that they have also been recruiting in Australia and the United States. Of course the decision to hire professionals from farther afield is not unique to Grande Cache. Stan mentioned that while recruiting in South Africa, company representatives frequently encounter their Australian counterparts trying to do the same.

Western Canadian Coal Corporation used a different approach to address staffing requirements. When production began at its Wolverine operation, the company opted to bring in a contractor to readily supply the necessary staff.

With the staffing pressures somewhat abated, Western was able to train workers who were new to the industry, including those transitioning from BC’s declining forestry sector. The plan, according to Wolverine general manager Bob Bays, is to eventually phase out the contractor’s involvement and staff all of the Wolverine project and the upcoming expansion with Western employees.

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coal and oil sands Most coal companies are also actively seeking to establish closer ties with educational institutions at all levels — from awareness programs for the K-12 group and offering work-study positions to university students in related fields to training programs for adults wishing to enter the industry.

Gratton said that an HR taskforce put together by the MABC has been working on attracting more under-represented segments of Canada’s population to mining. The groups targeted include women, new Canadians and First Nations communities.“We’ve identified a need for a $40 million investment over

the next five years,” said Gratton. “Of that, $10 million is expected to come from the industry.” The taskforce has also been lobbying the BC government to make adjustments to the 2009 provincial budget to further this cause. It remains to be seen whether the government agrees with the taskforce’s strategy, but the feedback from the various ministries and the strong support of the BC Ministry of Energy and Mines has been encouraging.“We’ve really done our homework and can back up our data, which always gives you credibility.”

Equipment: Who could have predicted that one of the Achilles’ heels of operation expansion would be the availability of tires?

However, shortages of these machinery basics have become a huge issue, and with good reason — lose one tire too many, and you’ve just lost the use of one of your trucks. And Murphy’s Law dictates it will likely be the largest, most expensive one in the fleet.

“We manage our tires like they’re made out of gold,”said Boyd Payne, president and CEO of Elk Valley Coal Corporation, the world’s second-largest exporter of metallurgical coal. According to Payne, the greatest constraint is in availability of the 63-inch tires, used on 320-tonne and larger trucks.

The mercury is falling Environmental concerns continue to be front and centre on the coal industry’s “to do” list. One recent development that has garnered a lot of attention on this front is the construction of Canada’s first activated carbon plant by Prairie Mines & Royalty, Ltd. (PMRL) and Norit Canada, which will address the challenges of removing mercury from coalfired utility emissions.

PMRL and Norit Canada are subsidiaries of Sherritt International Corp. and the Dutch activated carbon manufacturer Norit N.V., respectively. PMRL will operate the plant, and the company’s Bienfait mine will provide the raw feedstock for the $200 million project, while Norit will supply the technology and expertise. The company is the world’s largest manufacturer of activated carbon and has been selling the product for over 80 years. While historically, there hasn’t been a significant demand for activated carbon in Canada, a Sherritt representative explained that new provincial regulations expected to come into effect in 2010 are driving the demand.

32 | CIM Magazine | Vol. 3, No. 6

Photo courtesy of Elk Valley Coal Corporation

coal and oil sands

Co-op student with supervisor at Coal Mountain Operations, B.C.

Mercury has long been known as a by-product of coal-fired power generation. The two main reasons it is being targeted are its high toxicity and its persistence in the environment. For example, it is known to concentrate in the muscles of fish and shellfish. Because mercury occurs naturally in coal in very low concentrations, it would be prohibitively expensive to remove it before use. As well, the metal’s concentration in flue gas is very low, also posing a challenge.

The technology being used to achieve the capture of mercury is simple in its application. Powdered activated carbon (PAC) is injected into the gas stream and then the carbon particles that have bonded to the mercury in existing particulate matter (PM) filters are captured. The challenge has been in developing the proper mix to achieve the rapid rate of adsorption needed. Norit’s product lineup lists 150 different types of activated carbon, each with different pore size, particle size and structure. The particular types to be manufactured at the new plant are DARCO Hg and DARCO Hg-LH, aimed at plants burning low-halogen coal.

Sherritt’s interest in the technology can be considered enlightened self-interest — the company is by far the largest producer of thermal coal in Canada, accounting for roughly 94 per cent of the total volume sold. Also important is that 90 per cent of Sherritt’s coal is sold to mine-mouth power plant operations.The economics are such that if one of these plants were unable to meet the new emissions regulations, the corresponding mine would likely have to cease operations.

Norwest Corporation has announced the appointment of JOE AIELLO to the new position of Managing Director, responsible for all of Norwest’s operations.

CRAIG ACOTT replaces Joe as President of Norwest’s Canadian operations. The presidents of Norwest’s four business units (Calgary/Vancouver, Denver, Golden, and Salt Lake City) report to Joe. BOB EVANS, President of Norwest’s US-based mining consultancy group in Salt Lake, was elected Chairman of the Board of Directors during the February 2008 Director’s meeting.

Norwest is an employee-owned company that provides engineering and geoscience consulting services to the energy and minerals sector.

September/October 2008 | 33 NorwestCorp.indd 1

8/26/08 3:04:02 PM

Photo courtesy of Westshore Terminals

coal and oil sands

Stockpiling coal at Westshore Terminals

Looking under every stone A relatively unique issue faced by the coal market is the fact that few new deposits are being discovered, as “most of the major deposits are known,” explained Wright. Therefore, the challenge is not so much finding more coal, as finding coal that’s cost-effective to extract or finding new, more efficient ways to extract it.“We all take the easy stuff out first,”said Stan.

With its relatively new developments, Grande Cache is viewed by its steelmaker clients as a viable alternative to U.S.sourced coking coal.“We’re seeing a resource depletion issue in the United States,”said Stan.“They’ve been mining the stuff there for a long time, and there is just not as much left. This is especially true for low-volatile, high-quality coking coal.”

After over 100 years of production, Stan explained that the remaining U.S. resource is still of high quality, but is more difficult and more expensive to extract. But in the near term, the production costs are being dwarfed by the desperate demand for more met coal.

“If you look at a market where the price triples, the market is saying more product is needed now,” said Payne.“Anybody who is able to produce in this market does. You’re seeing things being put into production in the U.S. that weren’t even being considered as a possibility a year ago. Every rock is being turned to find more met coal.”

Another change we’re likely to see, added Payne, is a repurposing of some thermal coal into low-grade met coal.Though not the ideal choice, the shift will help offset steelmakers’ overall needs and let the much-needed higher quality met coal last a bit longer.

34 | CIM Magazine | Vol. 3, No. 6

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Shift change at Greenhills Operation B.C.

Supply-side pressures were further worsened by the flooding experienced in Australia’s main coal-producing region, said Payne. “That had the effect of removing something like 15 million tonnes from the supply, turning a tight situation into a desperate one,” he explained.

But the mining business is still a cyclical one and there is an expectation that Australia will resolve its logistical problems, though not for a while yet.

“Expectations are for another strong year for producers in 2009,” said Mike Plaster, an equity analyst with Salman Partners. “The market might ease off after that, but most likely we won’t see a significant improvement in Australian infrastructure until 2011 or 2012.” At that point, Plaster said, Australian production will likely drive the prices down a certain degree, but no one anticipates a return to the lows of recent years.

“You have these ‘marginal operations’starting up because of the high coal price, and they have a higher production cost,” Plaster explained. “They wouldn’t be coming online without an expectation that the price will remain high long enough to justify their economics.” If the price were to drop too low for these projects to make a profit, they would shut down and decrease supply once more.

The big picture? While emerging economies will continue to drive the demand for coal, supply will be constrained by infrastructural and technical problems. The outlook? The agile, the innovative and the strong will thrive — which puts Canadian coal companies on very strong footing indeed. CIM

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Photo courtesy of Elk Valley Coal Corporation

coal and oil sands

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Photo courtesy of CN

coal and oil sands

Coal chain in scenic Windy Point, Alberta

The Canadian coal chain

by Eavan Moore orldwide, industries big and small rely on the highquality coal found in Canadian seams to power their industries. However, getting this relatively basic product to them is often a very complex process. For domestic power plants, transportation is usually simple enough, as generally mine and plant sit side-by-side. For example, the average haul distance between Sherritt International’s Genesee mine in Alberta and its partnered EPCOR plant is only about four kilometres. All of the coal is moved on 150-ton trucks via private roads, in amounts tailored to the needs of the power plant. According to Sherritt’s manager of mine operations, Chris Barclay, the biggest transportation problem they face might be an industry-wide difficulty in acquiring tires to outfit the trucks.

However, unlike their competitors in Australia, whose operations generally lie close to water, coal mines in Alberta and eastern British Columbia must often transport their products over 1,000 kilometres west to Pacific ports for export to the coal-hungry, steel-producing countries in Asia and Eastern Europe, or east to serve power plants in Ontario. For these

W

companies, the effectiveness of their supply chain depends on delicate logistics between mine, rail, terminal and ship.

Meeting the customer halfway When producer and consumer coordinate an order, the coal customer is typically responsible for hiring a shipping company and nominating specific vessels bound for the terminal with which the coal company has a contract. The coal shipping facilities in British Columbia are located at Ridley Terminals in Prince Rupert, and Westshore and Neptune terminals in Vancouver. Another coal terminal at Thunder Bay handles shipments to Ontario.

Eugene Nagai, vice president of marketing and transportation at Grande Cache Coal Corporation, said that the company’s choices were limited to Vancouver when it started up four years ago.“We chose to go with Westshore because that’s where the bulk coal moves out of,” he explained.“For our limited production at the time — which was less than a million tonnes — we could take part cargoes on vessels that went to Japan and Korea.”

September/October 2008 | 37

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38 | CIM Magazine | Vol. 3, No. 6

To get the coal to port, the typical mine depends on the railway whose line happens to run closest to its operations — either Canadian Pacific or Canadian National. Bill Black, manager of processing at Western Canadian Coal’s Wolverine mine, explained that trains frequently run through to pick up a new load. Each month, the mine lets the railway know how many trains will be needed. The coal is reclaimed and loaded onto cars located on the rail siding, and then a CN locomotive picks up the train. “It’s pretty near a train a day,” said Black. Between 25 and 30 trains arrive for Wolverine and a neighbouring operation every month, each leaving with at least 10,000 tonnes of freight.

Efficiency on the railway Over the last several decades, railways have been increasing the amount of coal they can carry.Traditionally, coal was transported in steel-unit trains comprised of about 100 to 105 cars. But an ongoing trend of replacing steel cars with those made of aluminum means that more coal can be shipped on each train,as these cars are about five feet (or 10 per cent) shorter, so that the number of cars per train has increased to between 115 and 124.

Aluminum cars are also approximately six tonnes lighter than steel ones, enabling them to carry six additional tonnes of coal (roughly a six per cent increase, to about 106 or 110 tonnes per car).

“The biggest change I feel that’s happening right now is the introduction of these aluminum train sets,” observed Black. Currently, two of the three CN train sets dedicated to Western are aluminum.

By fall 2008, Black anticipates they will all be made of the lighter, more efficient material.

Jean Jacques Ruest, CN’s senior vice president of marketing, also explained that further efficiencies can be realized as new techniques of distributing power make it possible to run longer trains without compromising handling and braking capacity. Instead of the traditional method of leading with only one locomotive, the industry-wide trend is to now place multiple locomotives throughout the train for improved control over the cars that carry coal, grain and other commodities.

coal and oil sands Ruest reported that CN was able to run 150 grain cars with an additional locomotive placed at the back of the train and intends to reach 150 cars with the transportation of coal as well. In the future, the numbers may rise further. “The whole concept of distributed power has a lot of potential advantages for any major commodity that moves in unit trains,” Ruest said. He added that some fine-tuning is still needed to determine the best use of distributed power. “We’ve done experiments where we put the locomotive in different positions in the train,” he said. Currently, the additional locomotives are placed at the back of the train. To add an engine in the precise middle poses difficulties, as cars rotate when they reach a loop track; however, it may prove effective to add them in other positions.

“All this to try to mitigate the fact that Canadian coal mines are quite a long way from the water,” observed Ruest. “We have a natural distance disadvantage, which costs money.

Somebody’s going to be paying for that cost, but we try to offset everything we can through efficiency and innovation.”

Linking up the chain Innovations in one section of the supply chain take time to demonstrate their full effect, as each player decides whether to commit to equipment upgrades. Nagai explained that Grande Cache uses both aluminum and steel cars, because not all terminals have been equipped for the new, shorter cars. “Typically that’s why steel cars are still being used,

because the rotary dumpers at the terminals at Prince Rupert and Thunder Bay can only handle a certain size car with any efficiency,” he said. “Otherwise, if you used aluminum, sometimes they don’t fit the barrel of the dumper, or possibly, they’d have to uncouple each car as they dumped them.”The benefit of such a capital investment, and the question of who should be responsible for making it, has to be weighed carefully by all of the interested parties.

The transportation chain operates year-round, thanks in part to the mild BC climate, where ports never ice over. But every player in the chain expects some weather-related delays and has learned to cope with them.“Transportation is totally an outdoor sport,” commented Ruest. “The weather impacts different people at different times — fortunately seldom all at the same time, but often one after the other.”

According to Black, spring rains can soften the roads and flood open pit operations faster than they can be pumped clear. In the ports, late fall and spring windstorms can keep the terminal from functioning safely and cause delays from a few hours to half a day, which can create a backlog. “We shut down at 40 miles an hour,” said Denis Horgan, vice president and general manager at Westshore Terminals. He estimated that, altogether, wind causes a loss of five days of operation in a typical year; however, when the coast was pounded by a succession of windstorms in November and December 2006, Westshore lost 11 operating days.

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Photo courtesy of CN

coal and oil sands

Coal train snaking through mountains of British Columbia

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tion rates. When that happens, the delayed cargo can incur ship demurrage costs as its vessel waits in port.

Sharing the risk Any link in the chain experiences delays at some point, and not only for weather reasons. Coal production rises and falls cyclically. Railways may have experienced delays last winter; however, by spring and summer of this year, it was the coal operations that were producing below capacity. That left two train sets out of the railway’s 14-set coal fleet sitting idle. To help share the risk of overcapacity with the railway, some coal producers have begun to buy or lease their own sets.The railway is then less likely to have unused equipment on its hands in times of low production.

Whether this is indeed a good strategy depends on the mine. While Elk Valley Coal Corporation does lease a train set, other mines like Grande Cache Coal have found that their current production does not warrant it. They might find themselves paying storage costs for an unused train set. Further, as Black explained, “the power or the engines still belong to CN. They only allot so much power for the Northeast, and we share it with Peace River Coal and the Brule mine.They can only move so many trains in and out. So I don’t believe it would be a big advantage for us to have our own train sets.”

Pushback and negotiation on contract terms, and perhaps occasional impatience over delays, is an inevitable part of the system. What is perhaps most integral to keeping efficiency high and costs low is making sure that the physical systems in place function at their best. Ultimately, the success of the Canadian coal industry rests on its ability to move massive quantities of product across many miles without breakdowns.

“It’s all maintenance related, whether it’s at the mine or the terminal,”said Nagai.Each chain in the link depends on those that precede and follow it. Ruest concluded:“We all need to work together to make sure that despite the long distance between the Rockies and the water, the Canadian coal industry is able to maintain its strength.” CIM

Photo courtesy EPCOR Utilities Inc.

coal and oil sands

Keephills 3 turbine hall and plant

Clean coal and carbon capture and storage projects

by Binod Sundararajan anada’s Clean Coal Technology Roadmap has helped to draw much-needed attention and support from the coal industry, its supply-chain, academic and research groups as well as various government agencies to the issues of clean coal technology and carbon capture and storage (CCS). CCS involves capturing carbon dioxide from large industrial sources before it is emitted into the atmosphere, where it can contribute to climate change. The captured gas can be safely stored in mature oil and gas reservoirs or certain deep geological saline formations.

It is obvious from the significant clean coal and CCS projects underway that Canadian companies are very serious about reaching the important energy-related targets that have been set. They have evidently picked up the gauntlet and are prepared to tackle these tough issues head-on.

C

Impressive implementations EPCOR Utilities Inc. raised the bar for Canadian power production with its Genesee 3 unit, deploying supercritical com-

bustion methods and a $90 million voluntary investment in clean air technologies. The company has several new initiatives underway including the construction of water and wastewater systems, the replacement of aging infrastructure, the expansion of Canada’s renewable energy capacity and environmental remediation. Some of these projects include Keephills 3 and the E L Smith Upgrade.

In 2007, construction began on Keephills 3, a 450megawatt, supercritical, coal-fired unit west of Edmonton, in partnership with TransAlta Corporation. The Keephills 3 plant, built on the success of the Genesee 3 facility, is an important step towards meeting Alberta’s future power needs in a reliable, cost-effective and environmentally responsible manner. Keephills 3 will use supercritical boiler technology that features higher boiler temperatures and pressures and a high-efficiency steam turbine. Because less fuel is used, carbon dioxide emissions per megawatt are lower than in conventional coal plants.The plant will emit 24 per cent less carbon dioxide in producing the same amount September/October 2008 | 41

Courtesy of Alberta Geological Survey

coal and oil sands

CO2 storage detail

of power as the four obsolete Wabamun units being retired

by TransAlta by 2010.

In addition to these clean coal projects, EPCOR is also involved in all four CCS initiatives that are currently underway in Alberta – the Alberta Saline Aquifer Project, the ICO2N plan, the Heartland Area Redwater Project and the Wabamun Area Storage Project. Then there is the Boundary Dam 3 clean coal/carbon capture project in Saskatchewan.

Alberta Saline Aquifer Project ASAP is a broad-based, industry-supported carbon dioxide sequestration initiative that participants will roll out in three phases. Phase one, expected to be completed by the end of 2008, will involve identifying suitable locations for long-term sequestration in deep saline aquifers. Phase two will see the implementation of a pilot project during which sequestration sites will be designed to receive injected carbon dioxide. The third and subsequent phases will involve expanding the project to a large-scale, long-term commercial sequestration operation.The first project of its kind in Canada, ASAP will play a major role in advancing knowledge of CCS technology.

Canada-based Enbridge Inc., a leading oil and gas pipeline and distribution company, is heading a group of 19 energy industry participants like EPCOR, ConocoPhillips, Chevron Canada Resources, BP Canada Energy Company and others.

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The ICO2N brings together a broad cross-section of Canadian companies committed to helping this country

42 | CIM Magazine | Vol. 3, No. 6

meet its climate change objectives while supporting economic growth through CCS. The CCS system proposed by ICO2N will pipe carbon dioxide from multiple industrial locations to storage sites deep underground.

Studies indicate that the ICO2N proposal has the potential to reduce Canada’s carbon dioxide emissions by 20 million tonnes – the equivalent of taking four million cars off the road annually. This initiative represents Canada’s single largest greenhouse gas reduction opportunity and a bold response to the global climate change challenge. It provides a framework for the efficient and environmentally sensitive capture, transport, long-term storage and, potentially, even the use to enhance hydrocarbon recovery of carbon dioxide.

Heartland Area Redwater Project The Alberta Research Council (ARC) and ARC Energy Trust of Calgary have teamed up to create HARP, an advanced initiative for capturing and storing greenhouse gas emissions in what early indicators show to be an ideal underground formation nearby. HARP brings together government, industry and research scientists. It hopes to prove that the Redwater Leduc Reef complex can provide a long-term solution for greenhouse gas emissions from Alberta’s industrial heartland by housing as much as 1,000 megatonnes of carbon dioxide.

Phase one of HARP will evaluate in detail the size and suitability of the site for sequestration. Phase two will involve the drilling of a well to collect more detailed data, while phase three is planned to demonstrate actual carbon dioxide injec-

coal and oil sands tion and storage. The $1.8 million first phase, scheduled to be completed in the spring of 2009, is being funded by ARC Energy Trust, the Alberta Energy Research Institute and Natural Resources Canada.

The Wabamun Lake area southwest of Edmonton was selected by Alberta Geological Survey because various favourable conditions identify it as a potential site for future, largescale carbon dioxide injection. Several sizeable, industrial carbon dioxide sources are located in the vicinity, resulting in short transportation distances for the captured gas. Ideal deepsaline formations with suffi- Boundary Dam cient capacity to accept and store large volumes of carbon dioxide in supercritical phase exist at the appropriate depth. The Alberta Geological Survey has presented a test case for comparative modelling of carbon dioxide injection, migration and possible leakage in the Wabamun Lake Area of Alberta.

Boundary Dam Integrated Carbon Capture and Sequestration Demonstration

2008 budget,the federal government committed $240 million in trust in support of the demonstration project.

While its threat will not go away any time soon, it is reassuring to note that government, industry and academia are in the vanguard of the battle against climate change. Their combined efforts will highlight the focus on environmental remediation in the expansion of Canada’s renewable energy sources in the next five to ten years and the decades to come. CIM

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SaskPower is leading the development of one of the first and largest integrated carbon capture/sequestration demonstration projects in the world at Boundary Dam Power Station in Estevan, Saskatchewan. Max Ball, manager, said the SaskPower Clean Coal™ project entails rebuilding Boundary Dam Unit #3 into a 100-megawatt unit, with carbon capture technology, extending its life by approximately 30 years.It will fully integrate a coalfired generation unit with carbon capture, enhanced oil recovery and ultimately sequestration, resulting in low-emission electricity and increased oil extraction through CO2 Enhanced Recovery. Phase 1 of the demonstration will be operational by 2013, capturing half a million tonnes of carbon dioxide annually. Once fully operational in 2015, the demonstration is expected to capture about a million tonnes of carbon dioxide annually. In the

Photo courtesy SaskPower

Wabamun Lake Area Storage Project

d Re w ar

September/October 2008 | 43

Photo courtesy of Syncrude Canada Ltd.

coal and oil sands

Syncrude’s expansion facilities

A look at the future of the Canadian oil sands

by Dan Zlotnikov

t 2.7 million barrels per day, Canada accounts for about three per cent of the world’s total oil production. Even as conventional oil supplies continue to decline, one region in particular is continuing to grow in significance — the Alberta oil sands.

Representing over 95 per cent of all oil and gas producers in the country, the Canadian Association of Petroleum Producers (CAPP) endeavours to inform its members and assist them in making market-related decisions. To this end, the association produces an annual report from information derived from surveys of its members, as well as those involved in potential and existing markets and pipeline projects. The most recent report has projections extending until 2020 and the news is both good and bad.

“Our moderate growth scenario, which we use as a sort of baseline case, has Canada’s oil production grow dramatically through 2020,”said Greg Stringham, vice president of markets

A

and fiscal policy at the CAPP. “The oil sands alone will go from 1.2 million barrels per day in 2007 up to 3.5 million.”

Growing pains However, because of the sheer volume of growth in such a concentrated area, Stringham said there will be great challenges in meeting labour demands during the construction phase of the projects. “Operationally, the oil sands require a fairly small number of people,” he explained. However, the Construction Owners’ Association of Alberta estimates that the greatest peak in demand will occur in the second half of 2010, requiring a staggering 44,000 people. Stringham listed a number of initiatives geared to meeting this need that are underway in the oil sands industry.

“We have a large number of apprenticeships underway in trades,” he said. “Alberta is home to 11 per cent of Canada’s population, but offers 25 per cent of the country’s apprenticeships.” Because it takes three to four years to have an apprenSeptember/October 2008 | 45

coal and oil sands

Photo courtesy of EnCana

tice graduate to journeyman, Stringham acknowledged this as more of a long-term effort.

To address the immediate shortfall, Alberta has been outsourcing portions of the assembly and construction work to Ontario and Quebec, where the decline in the automotive industry has created a pool of trained workers. Rather than having these people move into the already overcrowded oil sands communities, smaller parts are sent over for assembly and then shipped back to be installed.

In addition to recruiting workers from other provinces, another initiative has focused on immigration. “We’ve had some success bringing people in on temporary work permits from the Philippines and Mexico,” said Stringham.

Just as there are growing pains on the construction side, there are some challenges anticipated on the demand side, as Canada looks for buyers for all the extra production.

“Of the 2.7 million barrels, Canada exports just over half, primarily to the U.S. Midwest,” said Stringham. As the production grows, CAPP has been looking to the Gulf of Mexico to pick up the extra production. “There are already refineries in Texas that are seeing a decline in oil coming from places like Venezuela and Mexico, which produces very heavy oil,” Stringham explained.“As that supply continues to decline, we can just move in and pick up the slack.”

Stringham suggested that the lighter oil coming out of the upgraders can be sold directly to the Philadelphia and New York markets in the United States or domestically to Eastern Canada. Overseas shipping is also being considered, but pipelines remain the most cost-effective method of moving oil, and so while tankers are an option, they are likely to remain an alternative rather than the first choice.

A rig drilling on a multi-well pad near a plant at EnCana’s Foster Creek operations.

46 | CIM Magazine | Vol. 3, No. 6

Breaking new ground: innovation key at EnCana The oil sands industry is benefiting from a pair of significant process improvements compliments of EnCana, an in situ operator in the Athabasca oil sands. The company operates the 60,000 barrels per day Foster Creek project and the younger, 7,500 barrels per day Christina Lake project. A third development, Borealis, is currently in the works and is expected to start production in 2015.

“Technology people are always looking for a game-changing, ground-breaking idea,” said Mark Bilozir, EnCana’s team leader of technology and diluent strategies. “We’ve recently completed a project that is almost a game-changing one.”

The most common approach to generating steam is what is known as a once-through steam generator (OTSG). “The OTSGs almost universally use natural gas to generate heat,” explained Bilozir. “You run water through the tubes and use the resulting steam in the extraction of your product. The specifications are such that you cannot convert all the water into steam because of the solids in the water.” Projects employing steam-assisted gravity drainage (SAGD) cannot use clean, potable water for their steam needs and use what is known as “brackish water,” which is not even suitable for agricultural use. The result of boiling off the majority of the water is a highly concentrated, black mixture of water and solids, salts and various other contaminants known as “blowdown,” which was traditionally disposed of either by being pumped down into a deep reservoir or treated to turn into a solid, which was then sent to a landfill.

EnCana’s innovation entailed taking the blowdown from four boilers and feeding that mix through a boiler one more time. The blowdown boiler evaporated the mixture at the same rate as the OTSGs, producing 75 barrels of steam for every 100 barrels of feedstock.“Except that now you have 25 barrels of waste from all four boilers, instead of 25 barrels from each,” explained Bilozir. “This pushed the steam generation rate to more than 90 per cent from the more common 75 per cent, and drastically decreased EnCana’s blowdown disposal costs.”

The blowdown boiler is a regular OTSG boiler — though smaller — running off-spec. The concern, Bilozir explained, was that the higher concentration of solids would damage the boiler. EnCana moved the boiler outside the usual specifications range and then ran it to see what would happen.

“We’ve been running this smaller boiler with the blowdown for six months now and have gone through a full inspection and were very happy to see that it hasn’t made a significant difference to its condition,” said Bilozir. The plan is to run the boiler until the end of its life, at which time the company will move to larger ones to be used in the blowdown boiler role.

EnCana’s second innovation concerns the drilling of wells.

Bilozir said that every winter the company drills 200 to 300 wells that are used to further delineate the deposit and identify areas of value. These wells can only be drilled during the winter when the ground is frozen and can take the weight off the drilling equipment. EnCana realized that the company’s growth was being constrained by the number of wells that could be drilled within the winter months.

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coal and oil sands In response, the company built larger pads that were capable of hosting six or seven wells as opposed to just one. This way, the drill rig would not have to be moved between the wells. Bilozir acknowledged that the idea is not new; however, EnCana’s situation presented its own set of challenges. “Our deposit is fairly shallow so there were concerns we would not get the requisite information needed from the wells if they were not spaced further apart,” he explained. Fortunately, the results were quite satisfactory and allowed for more efficient use of the rigs.

Pump jack pads at Imperial Oil's Cold Lake operation.

Huff and puff: Imperial Oil’s Cold Lake improvements With so much recent attention focused on the Athabasca region, one might forget that there is more to Canada’s oil sands industries — quite a bit more, in fact. The Cold Lake in situ project, in particular, bears mention. Owned and operated by Imperial Oil, Cold Lake began commercial production back in 1985.Since that time,the project has grown to incorporate 13 oilproducing phases, each producing between 10,000 and 13,000 barrels per day,making it North America’s largest in situ producer.

“The Cold Lake production in 2007 was 154,000 barrels per day,” said Imperial’s spokesman, Pius Rolheiser, who acknowledged that production can fluctuate significantly from quarter to quarter, due to the cyclical nature of the process. You’d be right to wonder how an SAGD in situ project can experience cyclic production; however, Cold Lake doesn’t use SAGD. A veteran of the oil sands, Imperial first acquired its lease for the Clearwater region in which Cold Lake is situated in 1960, 25 years before it began commercial production. At that time, no commercially viable oil sands extraction technique existed. “We did a lot of research and field pilot tests in the 1960s and 70s,” Rolheiser explained.

Imperial was instrumental in making today’s oil sands a reality and holds a patent on the SAGD extraction method, issued in 1982. The company also holds a patent on a different technology — cyclic steam stimulation (CSS), which it uses at Cold Lake.

48 | CIM Magazine | Vol. 3, No. 6

Rolheiser explained that CSS relies on a single well instead of the well pairs used in SAGD. The well is first injected with steam, left under pressure, and then the condensed water and dissolved bitumen are recovered from the well and the process starts again. This is the reason that the technique is colloquially referred to as “huff and puff.” Where the SAGD operator would see a constant stream of bitumen, CSS has distinct steam-in and production stages, which explains the fluctuations in numbers — as much as 20,000 barrels per day from one quarter to the next in Cold Lake’s case.

The reason Imperial opted to use CSS at Cold Lake was simple — SAGD would not work as well.“SAGD is more effective in a uniform reservoir, where the oil-bearing layer is consistent,” explained Rolheiser.“The reservoir at Cold Lake is less permeable and has more irregularities.”

The other requirement for CSS is an impermeable layer surrounding the reservoir — such as the shale at Cold Lake. This layer is necessary to trap the high-pressure steam inside the reservoir; without it, the process would be much more costly or not possible at all. For these reasons, Rolheiser said, anyone starting up a project in the vicinity of Cold Lake would likely be looking at CSS and not SAGD as the technique of choice. In fact, Canadian Natural Resources, Ltd. is using CSS in its nearby Primrose and Wolf Lake operations.

CSS has also seen a significant technological improvement — a technique Imperial has titled LASER, which stands for liquid addition to steam to enhance recovery.

“In LASER, we inject five to ten per cent light hydrocarbon as a diluent into the steam,” said Rolheiser.

The diluent is usually a natural gas condensate, but Imperial has also used naphtha and, on occasion, light crude oil. The mixture of high-pressure steam and diluent has proven much more effective in extracting the bitumen.

According to Rolheiser, the field test well completed its first full production cycle two and a half years ago, and the results were very significant. As much as 50 per cent more bitumen was recovered. Having received regulatory approval to implement the technology, Imperial has already installed LASER facilities in 10 of its 13 phases and is planning to introduce it in the remaining ones in the near future. The results from large-scale operations have proven consistent with the pilot test, resulting in a 30 to 50 per cent efficiency boost.

Efficiency has been the focus of much work at Cold Lake.

Despite receiving approval for construction of three additional phases, Rolheiser said that the company has not yet made a decision on the expansion plans.

“We looked at overall operation and decided that before we proceeded we wanted to optimize current operation,” Rolheiser explained. “We wanted to see how we could achieve efficiency improvements in the existing process by managing water and steam more effectively and improving interconnects.”

The emphasis on production efficiency, coupled with very gradual, phased expansion, is how Imperial weathered the lows of $12 a barrel of crude a decade ago, and how it will face today’s challenges of rising costs and shortfalls in refining capacity that the industry faces.

Photo courtesy of Syncrude

coal and oil sands

The Gateway Hill trail has become a popular tourist destination.

From mine to tourist attraction: Syncrude’s environmental successes This year has seen a first in the Athabasca oil sands.

Syncrude Canada Ltd., a long-time oil sands operator, is the first in the industry to have received reclamation certification from the government of Alberta.

Gateway Hill, a 104-hectare segment in the southeast corner of the mining lease, has been under reclamation by the company for the last 20 years, said Don Thompson, Syncrude’s general manager of regulatory and external affairs. However, most of that time was spent watching the trees grow to their full size rather than engaging in active reconstruction work.“Keep in mind that trees in this area take up to 80 years to mature,”Thompson explained.“Once you’ve contoured the hill for proper drainage, placed the topsoil and planted the seedlings, 20 years is not such a long time.”

The lease for Gateway Hill is still held by Syncrude, but has now been converted into a recreational lease. As part of the process — and to show the local community the success of the company’s reclamation activities — Syncrude installed various facilities on the trail, including statues, restrooms and sign posts on the hiking trails that identify the maturing vegetation. The result has been very well received and, in the process, Gateway Hill has become quite a tourist attraction.

“That’s not where our reclamation ends,” added Thompson. “To date, we’ve reclaimed something like 4,500 hectares of land — about a quarter of the original mining area.” According to Thompson, in short order, most of that land will be very difficult to differentiate from the original Boreal forest surrounding it.

There are very specific conditions reclaimed land must meet to receive provincial certification. Thompson identified five main requirements: it must be self-sustaining, nonerosive, stable and with productivity equal to or greater than that of the original area before the disturbance. The final requirement, and one of the main reasons so little land has been certified to date, is that once the lease is changed to a recreational one, or once the land reverts back to Crown property, it can no longer be used for mining-related activities.

“Whether it’s a well to monitor groundwater or a road to get to the other side of the mine, that would preclude the area from being certified,” explained Thompson. In the meantime, most of the reclaimed area continues to grow and slowly return to its original forested state.

Like most operators, Syncrude is also pursuing efficiency gains wherever it can find them. An ongoing improvement process can be seen in the extraction of bitumen at the company’s processing plant.“When we started operations back in 1978, we used to process the oil sands at 80° Celcius.We have gradually been able to lower that to 35 to 40° Celcius,” said Thompson. Considering that the company produces some 350,000 barrels per day, the energy savings are significant, to say the least.

According to Thompson, Syncrude has had a history of seeking out efficiency-boosting techniques.“Back many years ago when we built the Aurora mine, we put in a hot water

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September/October 2008 | 49

coal and oil sands loop from the base plant at Mildred Lake,” he recalled. The loop carried waste heat some 40 kilometres to the new mine, cutting down on Aurora’s energy requirements.

Looking forward, the company is planning to build on its recent environmental successes in another area, namely flue gas desulphurization. A recent major expansion project, Upgrader Expansion 1, included the addition of flue gas desulphurization technology, said Thompson.The result was a major boost in production and virtually no increase in the amount of sulphur dioxide gas emissions.“We are now retro-

fitting desulphurization units on the remainder of the plant which, when combined with existing technology, will decrease sulphur dioxide emissions by about 60 per cent,” Thompson added.

Of course, there are still environmental challenges to be addressed. Thompson identified tailings management as one area Syncrude is seeking to improve in the future.“Like all oil sands companies, we’re pursuing better technology to address this issue,” he said. “We’ve had a lot of success, but we will need to do even better in the future.”

Sustainable oil sands development

Every day is about safety. But it’s not every day we win an award for it.

The John T. Ryan award recognizes the mining operation with the lowest accident frequency rate. The Canadian Institute of Mining, Metallurgy and Petroleum awarded the Eastern Canada trophy

in the select mines categoryto IOC, recognizing the impressive

2007 safety record for our Labrador City and Sept Iles Operations. Our Safety

programs and training are among the best in the industry. This prestigious award reinforces our commitment to a safe working environment and the never-ending dedication our employees have to working safely. Every day.

Iorn Ore Company of Canada is an Equal Opportunity Employer www.ironore.ca

50 | CIM Magazine | Vol. 3, No. 6

Last year, Alberta’s government officially recognized the need for coordination of the mass of development focused on such a small region and formed the Oil Sands Sustainable Development Secretariat, with oil industry veteran Heather Kennedy at its head. Most recently, the Treasury Board of Alberta, to which the secretariat was subordinate, released an update on its work, as well as related initiatives in the region.

As part of its mandate to create both short- and long-term action plans, the secretariat has been working with the stakeholders in the oil sands to ensure future coordination. A draft of the strategic plan is to be completed this fall and will be followed by an implementation plan.

The province has also been working on the construction of new housing in the Wood Buffalo Municipality — the region that both benefited the most from the rapid growth and struggled the most with the growing strain on its infrastructure. A new development project in the communities of Parsons Creek and Saline Creek Plateau is expected to construct housing, recreational facilities, health clinics and related infrastructure for 40,000 people, with first homes becoming available in 2010.

With proper communication between all the stakeholders — another need the secretariat is working to address — the continued development can be managed to the benefit of not just the oil sands developers, but also the local residents and First Nations communities, and Canada’s economy as a whole. CIM

coal and oil sands

Petro-Canada's Edmonton refinery

Petro-Canada’s integrated approach in the oil sands

by Peter Symons few years ago, it was hard to imagine a barrel of oil reaching $140 or a Canadian dollar on par with the U.S. greenback. Today, with global energy demand hitting new levels, Alberta’s oil sands represent a critical source of supply and one of the few growth plays left in the global energy sector. It’s an exciting time for companies involved in the development of oil sands. For Petro-Canada, it means taking the expertise of an integrated energy company and putting it behind a strategy to get 10 billion barrels of high-quality contingent bitumen resource out of the ground and into consumers’ gas tanks.

As one of the few established industry players involved in the entire oil sands value chain — from production, including both mining and in situ production, to refining and, finally, marketing in our gas station network — the company is well positioned to develop the “Wells to Wheels” solution, and to do it right.

A

Leading the charge for Petro-Canada’s oil sands business is senior vice president Neil Camarta. As a former executive at Shell Canada, he knows first-hand the challenges with developing large-scale megaprojects. He took Shell’s $6 billion Athabasca Oil Sands Project from concept to startup. “Oil sands is a manufacturing business,” explained Camarta. “We start with a bitumen molecule stuck in the sand. Then we go through many steps to free that molecule from the sand and transform it into high-value petroleum products. Every transaction within the value chain has a profit margin. With Wells to Wheels, all links in the chain are operated by Petro-Canada.

There are no transfers to leak away profit.”

A Canadian approach Petro-Canada has more than 40 years of experience in oil sands development and production including its involvement with Syncrude, in which Petro-Canada maintains a 12 September/October 2008 | 51

Photo courtesy of Petro-Canada

coal and oil sands sion. At mid-year 2008, the plant was producing up to 30,000 barrels per day from four central well pads containing 48 well pairs. Each well pair is drilled vertically more than 100 metres underground before extending horizontally 750 metres into the reservoir. Well pairs can produce up to 1,200 barrels of bitumen daily and have a life of 10 years before they are exhausted and the pads are reclaimed.

In early 2005, Petro-Canada acquired the Dover oil sands lease adjacent to MacKay River and then in 2006 purchased additional acreage from the province of Alberta.The bitumen resources on these lands more than suffice to support a second plant — MRX. This proposed expansion will add up to 40,000 barrels per day of bitumen, with first production tentatively scheduled for late 2011. A final investment decision on MRX is expected in Q1, 2009.

Beyond MacKay River, the Lewis property has a very signifPetro-Canada is involved in the entire oil sands value chain — from wells to wheels. icant high-quality resource base and will be capable of operper cent interest. Other current Petro-Canada oil sands prop- ations even larger than MacKay River. Meadow Creek is also erties include the MacKay River in situ project (100 per cent an attractive development with its proximity to existing infraPetro-Canada) that began production in 2002, and the Fort structure.

At Fort Hills, Petro-Canada is developing a 160,000 barrel Hills oil sands project (60 per cent Petro-Canada), a fully inteper day bitumen mining operation. Production from the projgrated bitumen mining and upgrading project due to start ect is expected to commence in the fourth quarter of 2011. production in 2011. The company also has plans for in situ The mined bitumen will be upgraded at the company’s assets at the MacKay River expansion (MRX); Lewis, which is Sturgeon Upgrader, currently awaiting regulatory approval. approximately 40 kilometres northeast of Fort McMurray; and The light, sweet crude produced will be refined elsewhere.

Meadow Creek, about 45 kilometres south of Fort McMurray.

Petro-Canada’s core in situ resources, including MacKay “The key components of the Wells to Wheels project are River, Lewis and Meadow Creek, amount to about 8.3 billion the company’s MacKay River in situ project and its Edmonton barrels.

When combined with the company’s Syncrude interrefinery,” said Camarta. “The majority of the near-term bituests and the Fort Hills mining project, Petro-Canada’s oil sands men feed stock will Magazine come from MacKay River.”

CIM - September/October 2008 resources total more than 10 billion barrels.

Located 60 kilometres northwest of Fort McMurray, MacKay River is one of the largest commercial SAGD projects in the Athabasca oil sands area. The bitumen resource at Industrial heartland MacKay River totals 2.4 billion barrels, giving a lifespan of 25 to Petro-Canada’s Edmonton refinery, commissioned in 1971, 30 years for the current plant and the planned MRX expan- is located in an industrial area of Strathcona County, just east of Edmonton. It is Petro-Canada’s largest and most efficient refinery, processing about 135,000 barrels per day of crude oil into a wide range of consumer products such as gasoline, diesel and jet fuel.

In December 2003, Petro-Canada EXCELLENCE | INNOVATION | COMMITMENT announced plans to convert the Edmonton refinery to upgrade and refine oil sands feedstock exclusively.

The conversion takes advantage of Western Canada’s increasing supplies of heavy oil as conventional light crude oil production declines.

At the time of writing, the conversion is almost finished, with completion scheduled for the fourth quarter of 2008. Following conversion, the refinery’s output will continue to be 135,000 Specializing in the provision of turnkey camp operation and site support, facilities barrels per day, with approximately management, technical, logistics, and airfield services - to various industries.

85,000 barrels per day of conventional crude oil displaced by oil sands-derived www.atcofrontec.com www.atcofrontec.com bitumen and synthetic crude oil. The 52 | CIM Magazine | Vol. 3, No. 6

conversion includes increasing the capacity of the refinery’s coker, expanding hydrogen production and increasing sulphur handling capability, at an estimated cost of $2.5 billion.

In late 2003, Petro-Canada signed a key strategic agreement with Suncor to create additional value from its respective upgrading and refining facilities.That agreement calls for Petro-Canada to ship 27,000 or more barrels per day of bitumen from the MacKay River facility to the Suncor mining operation north of Fort McMurray. There, the bitumen will be processed into sour synthetic crude oil on a fee-for-service basis. That product will be supplemented with an additional 26,000 barrels per day of sour synthetic crude oil from Suncor’s operations. The combined volume will be sent to the Edmonton refinery for further upgrading and processing into finished product.

At MacKay River, Petro-Canada uses a Zero Liquid Discharge system. That means that essentially all water produced back from the reservoir is treated and turned into steam before being re-injected back into the wells.This process significantly reduces water volumes that are pumped from an underground source unsuitable for human consumption.

“As with all Petro-Canada operations and projects, the environment is a prime concern for us,” said Camarta.

The Edmonton refinery conversion project includes several initiatives to improve the refinery’s excellent environmental track record. By recycling treated municipal wastewater from Edmonton’s Gold Bar facility, Petro-Canada avoids the need for direct withdrawals from the nearby North Saskatchewan River. This creative approach has garnered accolades from all levels of government and several prominent environmental organizations.

Desulphurization projects completed in 2006 enable Petro-Canada to meet federal requirements for low-sulphur fuels.The refinery met the requirement for low-sulphur gasoline well in advance of the 2005 deadline. Diesel desulphurization work and budget met the 2006 deadline. The result will improve tailpipe emissions for all who use these Petro-Canada fuels.

Made in Alberta As well as the obvious advantages for Petro-Canada, Wells to Wheels is a made-in-Alberta project.“By upgrading and refining oil sands feedstock at our Edmonton refinery we’re keeping jobs in Alberta,”explained Camarta.“There’s a trickle-down effect that benefits service firms and equipment manufacturers based in Alberta, as well as royalties and business and personal income taxes that will flow through to the province.”

According to Camarta, the Petro-Canada oil sands game plan will progress through three phases: The “learning” phase included Syncrude and MacKay River. The current phase is a “growth platform” phase that includes the MacKay River expansion, Edmonton refinery conversion and Fort Hills Phase I.This phase should achieve 190,000 barrels a day by 2012. The final phase is the “growing” phase and includes Fort Hills Phase II, Lewis, Meadow Creek and other in situ projects. This final phase should get Petro-Canada to 350,000 barrels a day by 2017.

“Obviously, oil sands form a major part of Petro-Canada’s growth strategy,” said Camarta in conclusion.“We have great dirt and great people.That’s the real key to success.” CIM

About the author Peter Symons joined PetroCanada's oil sands division in 2007, as director of communications. Prior to joining the company, he worked in the U.S. and Canada in the utility and retail energy sectors.

September/October 2008 | 53

Photo courtesy of Fossil Water Corporation

coal and oil sands

Lake Athabasca

Innovative approaches to water quantity management on Athabasca River

by Bill Berzins and Bill Irvine limate change and unprecedented growth are placing new demands on Alberta’s watersheds. The Government of Alberta’s Water for Life Strategy calls for citizens, communities, industry and government to work together, sharing responsibility to improve conditions. The strategy’s collaborative approach has created exciting new opportunities for innovative water management approaches to meet ecological, economic and social needs.

Recognizing this opportunity, a group of scientists and engi-

C

54 | CIM Magazine | Vol. 3, No. 6

neers have been working since 2003 to develop a water management project that offers a unique solution to a growing demand for water on the Athabasca River.

Fossil Water Corporation, a Calgary-based water infrastructure development company, has been leading the development of an off-stream storage reservoir that would support the balancing of flows in the Athabasca River in anticipation of future demands from oil sands mining companies. With site investigations and design well underway,

coal and oil sands the project will help the industry mitigate future impacts on the availability of water in the river.

The Athabasca – unique among Alberta’s rivers At 1,538 kilometres, the Athabasca River is Alberta’s longest and one of the last free-flowing (undammed) rivers in North America. It stretches from the Columbia Ice Fields in the Rocky Mountain headwaters to its mouth in Lake Athabasca. Its delta joins those of the Peace and Birch rivers to form a 6,000 square kilometre complex of wetlands – one of the world’s largest freshwater deltas and one that has supported aboriginal communities for thousands of years. It is also an important staging area for migratory waterfowl, hosting up to 400,000 birds in spring and more than a million each fall.The delta is largely undisturbed by settlements and has been designated as a Ramsar wetland and a UNESCO World Heritage Site.

Athabasca River flows vary considerably with fluctuations in spring runoff, icing conditions and precipitation recharge within the watershed. A maximum daily peak discharge of 4,700 cubic metres per second was observed in 1971, whereas the lowest observed minimum daily flow was 75 cubic metres per second in 2001. Due to icing conditions, winter low flows can persist for a two to four month period.

Growing demand for water The ongoing development of oil sands mining projects in the Athabasca region has drawn more attention than ever on issues of water demand. Annually, 3.6 per cent of the Athabasca’s mean water volume is allocated to all users.

Specifically, the projected oil sands allocation is less than two per cent of annual flow, or 50 per cent of the total allocated.

Despite a relatively low rate of annual diversion, stakeholders remain concerned about instantaneous peak demands during winter lows, when flows can dip below 80 cubic metres per second. In 2008, Golder Associates estimated that licensed demand for water diversion by oil sands operations were at a peak of 18.9 cubic metres per second, with actual withdrawals likely at 85 per cent of licensed amounts, representing a maximum potential withdrawal of 16.1 cubic metres per second.

In response, and in an effort to strike a balance between ecological, economic and social requirements, Alberta Environment and the Department of Fisheries and Oceans established the Water Management Framework (2007). The framework specifies periods during which flow is managed according to potential impacts and assigns a colour code indicating the severity of the conditions as follows: • Green condition: During most years, the flow in the river is sufficient to meet environmental and human needs and withdrawals are allowed up to a maximum of 15 per cent of the flow in the river.

• Yellow condition: Applied when the river is experiencing natural low flows and water withdrawals may increase stress to the aquatic ecosystem. Records indi-

Site location of McMillan Lake off-steam storage reservoir.

•

cate this condition has occurred about 14 per cent of the time. During the yellow condition, water withdrawals proceed with caution and are limited.

Red condition: A designation indicating that the river is experiencing natural low flows. Records show this occurred about four per cent of the time.Total water withdrawal is restricted to ensure fish habitat loss is minimal.

Water management strategies The Water Management Framework establishes more restrictive limits for withdrawals during winter low flows.

These restrictions have had an adverse impact on water supply for oil sands companies, particularly junior companies and those with new or prospective licences. As a result, industry and stakeholders alike are working on a variety of innovative demand-side and supply-side solutions.

Some of the demand-side initiatives include: • recycling and reusing process water; September/October 2008 | 55

coal and oil sands • clean-up and use of brackish water from underground aquifers; • development of non-thermal in situ bitumen recovery methods; • recapture and reuse of water from the mine tailings; • application of alternative extraction and tailings technologies; and • coordination of water withdrawals between companies.

McMillan Lake Off-Stream Storage Reservoir There have also been a number of supply-side solutions proposed, including the potential implementation of onstream and off-stream storage.

The concept of a collaborative regional water storage project was proposed by Golder Associates in 2001. They postulated that water could be diverted from the Athabasca River during high flow periods and released when flows were low to directly offset downstream withdrawals. They later identified several low cost storage options. In 2005, Fossil Water Corporation retained the services of Golder and together they selected McMillan Lake as a preferred storage site for an off-stream storage reservoir (OSR) on the basis of economic, ecological and social criteria.

McMillan Lake is a natural water body situated approximately 170 kilometres upstream from Fort McMurray. It covers 19 square kilometres and has an average depth of 1.5 metres, with a relatively small catchment area of about 49 square kilometres. Given its shallow depth and low dis-

solved oxygen content, it was determined that the lake is unlikely to support a sustainable sport fish population.

The McMillan OSR would supplement flows to the Athabasca River to offset downstream withdrawals. By raising the lake by a nominal three to five metres, 100 million cubic metres of storage can be created with minimal earthworks.This volume would allow for a normal withdrawal rate of 4.5 cubic metres per second during high-flow periods, with a normal release of 10.9 cubic metres per second back to the river during low-flow conditions. The reservoir has been sized to accommodate the full spectrum of successive low-flow years, based on a rigorous analysis of the hydrographic record.

Storage volumes at the proposed McMillan OSR would be allocated to multiple subscribers for release back to the river to augment flows at the point of the subscriber’s intake, as required. The approach generates several benefits including: • zero-net diversion at the subscriber’s intake point; • higher river flows downstream of the McMillan discharge; and • avoidance of harmful alteration, disturbance or destruction of fish habitat downstream of the subscriber’s intakes.

By taking advantage of the existing topography and storage volumes, the aggregate construction cost for storage at the site can be as low as $3.50 per cubic metre, thereby reducing storage costs for new mine projects and simplifying mine-site development.

Collaboration between industry, government and stakeholders is increasingly sought under Alberta’s Water for Life Strategy — a policy framework that promotes partnerships and higher standards for watershed management. The McMillan OSR project demonstrates that innovation and collaboration can result in improved ecological performance at a competitive price. CIM

About the authors Bill Berzins is president of Fossil Water Corporation, and Bill Irvine is the company’s technical director. They each have over 25 years’ experience in environmental and water infrastructure projects for resource and land development.

56 | CIM Magazine | Vol. 3, No. 6

Photo courtesy of North American Energy Partners

coal and oil sands

Heavy hauler on the job at an oil sands operation.

North American Energy Partners’ president and CEO, Rodney Ruston, discusses the challenges and opportunities for third-party contractors involved in the oil sands.

by Rodney Ruston hen North American Energy Partners first began working with customers in Alberta’s oil sands back in the 1960s, nobody predicted the impact it would have on our business. In those days, the process for extracting oil from bitumen was still in its infancy. Costs were high, the technology was unproven and many watching the industry were skeptical about how the oil sands would ever become viable when it cost more to produce a barrel of crude than it could be sold for. Still, early pioneers like Suncor (previously Sun Oil) and Syncrude persevered and they needed third-party construction and mining contractors like us to help them.

Today, the Alberta oil sands have grown to become the dominant part of our business. We now work with virtually every major producer in the region, providing a diverse range

W

58 | CIM Magazine | Vol. 3, No. 6

of mining, construction, piling and pipeline services. As our customers’ pace of development has escalated, we have grown and evolved our own business in response. In the past five years, our employee base has grown from approximately 658 people to over 2,387, and our equipment fleet has experienced similar expansion. We currently operate over 845 pieces of heavy equipment, including some of the world’s largest mining shovels.

All of this growth is exciting and there is no question that it is rewarding. Our revenue neared the $1 billion mark in fiscal 2008 and we achieved record earnings. However, keeping pace with the demand has also presented significant challenges. At the top of the list is the task of attracting and retaining the heavy equipment operators, mechanics, project managers, construction personnel and support staff that we need.

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coal and oil sands This is especially challenging for a contractor. Unlike producers that can predictably plan their human resource requirements based on production targets, our personnel needs are linked to contract wins — typically large-scale projects that can require the addition of hundreds of new employees on short notice.That is a difficult proposition in any market and particularly so in Fort McMurray’s red-hot labour market.

To address the labour shortages, we have extended our recruiting efforts across Canada and beyond, enhancing our programs for those who want to work here but live elsewhere. This includes the implementation of more flexible work schedules that make it possible for employees to spend every third week at home.

We have also positioned North American as a preferred employer with competitive compensation and a strong emphasis on health and safety. We are well aware that safety can become one of the first casualties of rapid growth, especially given the large number of inexperienced people coming to the oil sands. We have no intention of letting that happen at our company. Our evaluation systems help us accurately determine the competency level of new recruits prior to placing them in the field. If

they are weak in certain areas, we ensure they get the appropriate training and are partnered with a more experienced employee. Our training department includes a full

Another major growth-related challenge is securing

the equipment we need when we need it.

60 | CIM Magazine | Vol. 3, No. 6

contingent of trainers, who work with employees both in classrooms and onsite. We also provide computer simulators that let heavy equipment operators train in a virtual environment before heading to the field. In addition to these job-specific programs, we also offer employees a wide range of short- and long-term development programs that encourage people to upgrade their skills and move up in the company.

Unfortunately, one of the signs of the success of our training program is that North American’s employees are particularly attractive to other employers, including many of our own clients. This is a fact of life in a competitive labour market and one that we have turned into a benefit by reminding new recruits that a stint with North American looks very good on their resume.

Another major growth-related challenge is securing the equipment we need when we need it.

Lead times for haul trucks in the 100to 300-ton range have increased by about 50 per cent to 18 months as a result of worldwide demand for mining equipment. Tire shortages have also ramped up our equipment costs and required us to put trucks on blocks at times. To cope, we have had to improve our long-range equipment planning and utilization and put more managers in place to oversee this function. The job of these managers is to help us achieve the optimal balance of owned and rented equipment and to ensure that equipment is allocated as productively as possible.

We have also become much more sophisticated about how we manage the maintenance of equipment. As an example, we have moved away from manual equipment monitoring systems and installed onboard computerized technologies on our trucks. These new systems monitor the health of the truck and indicate when maintenance is required. Through GPS, these systems also tell us where the equipment

Photo courtesy of North American Energy Partners

coal and oil sands

Lead times for acquiring heavy equipment have increased substantially

is located — an important requirement in a large and growing fleet.

Of course, we are not alone in having to manage growthrelated challenges. Virtually all of our oil sands clients are in a rapid development phase and many are outsourcing more significant portions of their operational requirements as part of their own response strategy. For example, in 2005 Canadian Natural Resources Limited contracted its entire overburden mining operation to us under a 10-year contract.

More recently, we took on the role of general contractor on Albian Sands’ aerodrome project, which was built to accommodate direct air service to Albian’s Expansion 1 site. We were responsible for all aspects of the design and construction of the project, which included an airstrip capable of landing an Airbus 319, terminal buildings and other ancillary operations.

For North American, having the capacity and the willingness to take on these larger contracts is essential to our continued success in the oil sands. We either keep pace with our customers’ needs or we make way for those who can.

However, larger and more complex projects present their own challenges, including more complex client and supplier relationships. The larger the project, the more contacts involved. Add in the high rate of oil sands employee turnover and the challenges escalate. It is not at all uncommon to have key client contacts, such as the project manager, safety administrator and contract administrator, change three times during the life of a contract. To keep projects moving smoothly, we have had to greatly improve our communication practices and tools.This includes building and maintaining client matrixes to simply keep track of who’s who.

More complex projects also carry more risk, and this is an even greater challenge for oil sands service providers. To manage, we have had to adopt more stringent reporting requirements, which necessitated enhancing our internal systems and IT capabilities and expanding our management team. The investment has been worthwhile. Not only has our project management improved but we have also protected our access to growth capital. In today’s tight credit environment, only those organizations with excellent systems and the demonstrable capability to perform can secure financing.

Overall, growth in the oil sands has presented some major challenges for us, but it has also transformed North American Energy Partners into a larger, stronger and much better organized company. Above all, it has made us a highly adaptable company that can respond effectively to new challenges and opportunities. Given industry projections for continued oil sands growth, that adaptability could yet prove to be the most important asset we possess. CIM

About the author Rodney Ruston is the president and CEO of North American Energy Partners and a member of the Northern Alberta Institute of Technology’s President’s Advisory Committee. He has spent his entire career in the natural resources industry.

September/October 2008 | 61

Photo gracieusement fournie par CN.

charbon et sables bitumineux

Stock de charbon au terminal charbonnier Neptune.

e Canada est l’un des plus grands producteurs de charbon au monde. En plus des ressources houillères, du climat politique stable et des excellentes infrastructures, les mineurs canadiens ont la formation et l’expérience nécessaires pour extraire le charbon de manière efficace tout en rencontrant, et même en dépassant, les lignes directrices environnementales.

La demande est forte pour le charbon thermique et le charbon métallurgique; les prix de ce dernier ont beaucoup grimpé en raison de la demande accrue des pays BRIC (Brésil, Russie, Inde, Chine). Des problèmes logistiques et de température ont nui à l’Australie. Il en a résulté une hausse des prix – de moins de 100 $/tonne pour le charbon cokéfiable l’an dernier – à des sommets récents de plus de 300 $/tonne et, pour le charbon thermique, un doublement des prix, d’environ 50 $ à plus de 100 $/tonne.

Les défis sont toutefois familiers : coûts élevés, longs délais pour l’obtention des permis et réglementations environnementales de plus en plus exigeantes. Allen Wright, président et directeur général de l’Association charbonnière canadienne, signale qu’aucun nouveau projet n’est en cours, bien que plusieurs soient au stage de demande de permis. Cependant, même avec un permis, il peut subsister des risques et des pièges, dit Pierre Gratton, président et directeur général de la Mining Association of British Columbia.

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Par exemple, le projet Galore Creek, développé par NovaGold Resources, a été mis sur la glace en raison des coûts croissants.

Obtention des permis : « Le gouvernement fédéral a créé un bureau de gestion des projets majeurs. Le but est de simplifier le processus de demande de permis et d’éviter les chevauchements entre les organismes de réglementation provinciaux et fédéral », dit M.Wright. Il espère que la rationalisation des procédures permettra l’obtention plus rapide des permis et que l’industrie pourra ainsi profiter des marchés avides de charbon.

Coûts : Les exploitations et les projets en construction ressentent l’effet des coûts élevés de l’énergie.

Heureusement, le processus de production du charbon ne dépend pas trop des entrants énergétiques; une mine ne fermera pas en raison du coût du diesel. Cependant, l’énergie ne constitue qu’une variable touchant les coûts d’exploitation; un autre problème guette l’industrie – la pénurie de main-d’œuvre.

Main-d’œuvre : Ce n’est pas d’hier que les exploitations minières manquent de travailleurs qualifiés. La situation est particulièrement difficile en Alberta où les projets des sables bitumineux ciblent la même main-d’œuvre et proposent des salaires que peu d’autres peuvent offrir.

Le recrutement demande donc des approches innovatrices. « Nous recrutons dans les autres régions du Canada;

Photo gracieusement fournie par Elk Valley Coal Corporation.

charbon et sables bitumineux

Ingénieur géologue examinant un filon de charbon à la mine Fording River, C.-B.

nous avons eu un certain succès en Afrique du Sud et nous avons un ingénieur de la Nouvelle-Zélande », dit Bob Stan, président et directeur général de Grande Cache Coal.

La Western Canadian Coal Corporation passe plutôt par des contracteurs. Western a aussi formé des travailleurs du secteur forestier, lequel décline en Colombie-Britannique.

La plupart des compagnies établissent aussi des liens avec des institutions d’enseignement et offrent des stages à des étudiants universitaires ou des programmes de formation à des adultes qui désirent se joindre à l’industrie.

M. Gratton souligne aussi les efforts effectués auprès des groupes sous-représentés : les femmes, les nouveaux Canadiens et les communautés des Premières Nations. Un groupe de travail de la Mining Association of BC pousse le gouvernement à ajuster le budget provincial de 2009 pour faire avancer cette cause.

Équipements : La pénurie en équipements de base constitue une préoccupation importante. Qui aurait pu prédire que le talon d’Achille serait la disponibilité de pneus? « Nous gérons nos pneus comme s’ils étaient en or », dit Boyd Payne, président et directeur général d’Elk Valley Coal. Selon lui, la plus grande contrainte est la disponibilité des pneus de 63 pouces, pour les camions de 300 tonnes.

Un développement récent pouvant aider les préoccupations environnementales de l’industrie est la construction d’une usine de charbon activité utilisé pour retirer le mercure, un sous-produit des émissions des centrales alimentées au charbon. Le mercure est ciblé en raison de sa grande toxicité et de sa rémanence dans l’environnement.

La technologie utilisée est simple : du charbon activé en poudre est injecté dans le flux gazeux et les particules de charbon qui se sont liées au mercure sont captées dans les filtres. Le défi a été de développer le bon mélange pour rencontrer le taux d’adsorption requis. Norit produit 150 différents types de charbon activé, chacun avec sa propre granulométrie, dimension des pores et structure; par exemple, le type DARCO Hg-LH a été conçu pour les centrales qui brûlent du charbon à faible taux d’halogène.

Sherritt International Corp., le plus grand producteur de charbon thermique au Canada, est très intéressé par cette technologie; la compagnie vend en effet environ 94 % de son charbon directement à des centrales thermiques. Si l’une de ces usines ne rencontre pas les nouvelles réglementations concernant les émissions, la mine correspondante devrait sans doute fermer.

Selon M. Wright, la plupart des grands gisements sont connus. Le défi consiste donc à les exploiter de manière plus efficace. En général, plus le gisement est jeune, plus les coûts d’exploitation sont bas. « Nous commençons par extraire ce qui est facile », dit M. Stan.

Après 100 ans et même 200 ans de production aux États-Unis, la ressource est encore de grande qualité mais elle est plus difficile et coûte plus cher à extraire.

Cependant, à moyen terme, les coûts d’exploitation sont faibles par rapport à la demande désespérée pour le charbon métallurgique. « La pression de l’offre a été aggravée par les inondations dans les régions productrices de charbon en Australie; retirant environ 15 millions de tonnes de l’approvisionnement », explique M. Payne. « L’année 2009 devrait être bonne pour les producteurs », dit Mike Plaster, un analyste boursier chez Salman Partners. « L’attente générale est que nous devrons attendre en 2011 ou 2012 pour que les infrastructures s’améliorent en Australie. La production australienne pourrait alors faire baisser les prix quelque peu mais personne ne s’attend à un retour des faibles prix des dernières années. » ICM September/October 2008 | 63

Photo gracieusement fournie par Encana

charbon et sables bitumineux

Pétrole lourd

Un coup d’œil sur l’avenir des sables bitumineux canadiens 2,7 millions de barils de pétrole par jour, la production du Canada représente environ 3 % de la production mondiale. Selon Greg Stringham, vice-président des marchés et des politiques fiscales à l’Association canadienne des producteurs pétroliers (ACPP), la production conventionnelle diminuera à la faveur des sables bitumineux. La production devrait croître rapidement jusqu’en 2020; celle provenant des sables bitumineux passera de 1,2 millions de barils par jour (2007) à 3,5 millions de barils. » Toutefois, la concentration de la croissance dans une petite région entraînera des pénuries de main-d’œuvre durant la phase de construction des projets. Le sommet de 44 000 emplois devrait survenir dans la seconde moitié de 2010. « Nous avons actuellement beaucoup d’apprentis, l’Alberta détient 11 % de la population canadienne mais 25 % des postes d’apprentissage. » Pour palier ce manque, l’Alberta confie des parties du travail d’assemblage et de construction à l’Ontario et au Québec,

À

64 | CIM Magazine | Vol. 3, No. 6

où le déclin de l’industrie de l’automobile a libéré des travailleurs expérimentés.

L’industrie a aussi recours à l’immigration, surtout des travailleurs en provenance des Philippines et du Mexique. La construction s’avérera difficile, mais il faudra aussi des acheteurs pour cette production accrue.

Selon M. Stringham, le pétrole léger pourrait être vendu directement sur les marchés de l’Est du Canada et des ÉtatsUnis. L’expédition outremer par pétroliers est aussi étudiée mais le transport par pipeline demeure la manière la plus rentable de déplacer le pétrole.

L’innovation chez EnCana L’industrie des sables bitumineux profite des améliorations de procédés d’EnCana, un exploitant des sables bitumineux de l’Athabasca. La compagnie exploite les projets Foster Creek (60 000 b/j) et Christina Lake (7500 b/j); un troisième projet, Borealis, devrait entrer en production en 2015.

charbon et sables bitumineux « Les technologues recherchent toujours des idées novatrices », dit Mark Bilozir, chef d’équipe de la technologie et des stratégies de dilution, EnCana.

L’approche normale consiste à de générer de la vapeur dans une chaudière de type à circulation forcée à une passe (Once-Through Steam Generator). « Le gaz naturel génère de la chaleur; l’eau circule dans des tubes et produit de la vapeur qui sert à extraire le produit », explique M. Bilozir. « L’eau ne peut pas être complètement transformée en vapeur en raison des solides qu’elle contient. » Les projets qui se servent du drainage par gravité au moyen de la vapeur n’utilisent pas de l’eau potable pour la production de la vapeur; l’eau « saumâtre » utilisée ne convient même pas à l’agriculture. Les résidus de l’évaporation forment un mélange noirâtre d’eau, de solides, de sels et autres contaminants dont on disposait par pompage dans un réservoir profond ou par enfouissement une fois traité et solidifié.

EnCana reprend cette eau de purge des quatre chaudières et l’évapore une autre fois. « Il y a maintenant 25 barils de résidus provenant de l’ensemble des quatre chaudières au lieu de 25 barils provenant de chaque chaudière. Le taux de génération de vapeur atteint maintenant 93,75 % (au lieu de 75 %) et cela a grandement réduit les coûts de disposition des produits de la purge.

La seconde préoccupation d’EnCana concerne le forage de puits. Chaque hiver, la compagnie fore de 200 à 300 puits pour délimiter le gisement et trouver des secteurs productifs.

Seul un sol gelé peut soutenir le poids des foreuses. « La compagnie a construit des bases plus grandes d’où il est possible de forer six à sept puits. Nous obtenons l’information requise même avec un faible espacement des puits », poursuit M. Bilozir.

Améliorations à Cold Lake Le projet Cold Lake, propriété d’Imperial Oil, est entré en production en 1985; depuis ce temps, le projet à grandi et il comprend maintenant 13 phases productrices de pétrole, produisant chacune de 10 000 à 13 000 barils par jour. « En 2007, la production de Cold Lake était de 154 000 b/j », dit le porte-parole d’Imperial Oil, Pius Rolheiser.

Imperial Oil a acquis le bail pour la région de Clearwater, où est situé Cold Lake, en 1960, 25 ans avant l’existence d’une technologie rentable d’extraction des sables bitumineux. En 1982, Imperial a obtenu un brevet pour la méthode d’extraction de drainage par gravité au moyen de la vapeur; la compagnie détient aussi un brevet sur une autre technologie : la stimulation cyclique par la vapeur, laquelle consiste en des cycles alternatifs d’injection de vapeur dans le puits de production, puis d’extraction du liquide chauffé par ce même puits.

Cold Lake utilise cette méthode en raison de la perméabilité moindre du réservoir, des nombreuses irrégularités et d’une couche imperméable entourant le réservoir.

Imperial a aussi amélioré cette technique de stimulation cyclique par la vapeur : une technique que la compagnie appelle LASER – Liquid Addition to Steam to Enhance

Recovery [Ajout de liquide à la vapeur pour améliorer la récupération]. « Nous injectons de 5 à 10 % d’hydrocarbure léger, habituellement un condensat du gaz naturel, pour diluer la vapeur », dit M. Rolheiser. Le mélange sous haute pression s’est avéré beaucoup plus efficace pour extraire le bitume; le taux de récupération a été amélioré de 50 %.

Malgré l’obtention de l’approbation pour trois phases additionnelles, la compagnie veut procéder très lentement en mettant l’emphase sur la gestion efficace de l’eau et de la vapeur.

Syncrude – de mine à attraction touristique Syncrude est la première industrie à avoir obtenu un certificat de restauration du Gouvernement de l’Alberta.

La compagnie restaure Gateway Hill, un segment de 104 hectares, depuis 20 ans, dit Don Thompson, directeur général des affaires externes et réglementaires. « Ce n’est pas si long, si on pense que les arbres prennent 80 ans pour atteindre la maturité », dit-il.

Le bail a été converti en un bail récréatif et Gateway Hill est devenu une attraction touristique. « La restauration ne finit pas là », ajout M. Thompson. « À ce jour, nous avons restauré environ 4500 hectares de terrain, soit le quart du secteur minier original. » L’obtention d’une certification exige de rencontrer des conditions très spécifiques, dont l’exigence qu’un terrain à vocation récréative ne doit plus être utilisé pour des activités minières, que ce soit pour un puits d’observation ou une route pour atteindre un autre secteur de la mine.

Syncrude recherche aussi des gains d’efficacité. « Nous avons abaissé notre température de traitement de 80 ºC à 35-40 °C », dit M. Thompson. Étant donné que la compagnie produit quelque 350 000 b/j, cela représente des économies d’énergie importantes.

Pour l’avenir, la compagnie veut désulfurer les gaz des cheminées et améliorer la technologie de gestion des résidus.

Le développement durable des sables bitumineux L’an dernier, le Gouvernement de l’Alberta, a officiellement reconnu le besoin de coordonner le développement considérable d’une si petite région et a crée le Sustainable Oil Sands Development Secretariat, avec Heather Kennedy comme directrice.

Un plan stratégique sera déposé à l’automne, suivi d’un plan d’implantation. La province travaille aussi à la question du logement dans la municipalité de Wood Buffalo – la région qui a le plus bénéficié de la croissance rapide mais qui a connu le plus de problèmes d’infrastructures.

Avec une bonne communication entre toutes les parties, le développement continu pourra être géré pour le plus grand bien non seulement des promoteurs des sables bitumineux mais aussi des résidents locaux, des communautés des Premières Nations et de l’économie canadienne. ICM September/October 2008 | 65

innovation Design changes for today’s haul trucks The origins of today’s rigid frame haul trucks predate the advent of mechanical power. In the horse-and-buggy days, payloads were deposited into a hinged dump box and pulled to the dump area by a beast of burden.

The driver’s job was to guide the animal and cart to and from the load and dump locations and assist in turning the beast and cart around for loading and dumping.

Engines of thousands of horsepower with automatically controlled transmissions have replaced the beast of burden. The development of larger tires, wheels and axles, and the use of camera and sensor systems to see with have all allowed payloads to grow to hundreds of tonnes. A new generation of autonomous haulage vehicles is evolving with design concerns such as the location and mounting of the necessary telemetry and communication antenna arrays.

Today’s haul trucks are still designed around a beast pulling a payload with a driver guiding the way. The haulage cycle these large trucks follow is in part a throw-back to an earlier

by Mike Parsons time. The vehicle backs into its loading position, travels to the dump area, where it turns around and dumps its load, and then travels back to the loading area, where it again turns around and starts over.

Changing the haul cycle is the idea behind the design of the patented Vector Neutral Truck, which is designed around a payload,

Beasts of burden pull payloads to the dump.

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66 | CIM Magazine | Vol. 3, No. 6

productive

innovation

Vector Neutral trucks are insensitive to direction.

Vector Neutral trucks with 400-ton and 60-ton capacities.

not a power plant and driver. Positioning the engine and operator midway between the axles and steering the axles equally and opposite to each other creates a situation where both ends of the truck are the same. From the controls, the driver has an equal view of travel in both directions without having to change orientation. Because vehicle performance is the same in both directions, it is insensitive to direction or, in other words, “vector neutral.”

There is, therefore, no need to turn the truck around for loading or dumping.

There are undisputable advantages, in terms of time and distance, that result from eliminating the turn-around and back-up parts of the haul cycle. This change in the haul cycle results in less steering and brake actuations, less wear on the drive train, less scrub and wear on tires, no need for maintaining turn-around areas, and ease in adapting remote and automatic control of the vehicle.

Vector Neutral trucks with 400-ton and 60-ton capacities have the same power plants as conventional trucks of the same capacity: 2,700 horsepower for the 400-ton truck and 650 horsepower for the 60-ton truck. The engine is mounted mid-ship in the main frame, driving two axles through a mechanical transmission or electric wheel motor. Each axle has four tires, which carry half the total vehicle weight, regardless of whether the truck is loaded or empty.

Conventional suspension members are fixed to an excavator-type slew bearing that allows rotation of the axle and

suspension about a vertical centreline to steer the truck.

The driver sits facing perpendicular to the line of travel and watches a multiple-screen display that is fed by multiple redundant cameras to produce a virtual view of the vehicle’s travel path.

Mining companies today are seriously evaluating their future haul truck options and the Vector Neutral Truck might provide the next technology innovation for more efficient operation. CIM

About the author Mike Parsons is a mechanical design consultant in Sudbury, supplying services since 1994 to customers in the mining, construction, utility and agricultural industries. Mike is now promoting his patented Vector Neutral Truck while enjoying the natural allure of northern Ontario life.

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eye on business New international developments in oil sands projects We often think of oil sands as being synonymous with Canada and Venezuela. The announcement in May

by Eni SPA (ENI) that it had reached agreement with the Republic of Congo for the development of a large oil sands project in the country, linked with investments in biofuels, power and social issues, now puts Africa (Congo) on the oil sands map.

Driven by worldwide competition for oil assets and a deeper understanding of country needs, governments, national oil companies operating outside their own territory and international oil companies are helping to build new policy in oil extraction. Company

by John Vercoe boards are personalizing their oil, gas, liquefied natural gas and oil sands projects with supplementary business and support, such as low-interest loans, construction of transportation, healthcare, biofuel

projects, power plants, new technology and armaments. Recent developments in international policy in terms of Africa may have some influence on how these projects develop.

Africa Energy Commission After many years of discussion, in February 2008 the Africa Energy Commission was inaugurated in Algiers.

It is seen as the African Union’s answer to the Organisation of Petroleum Exporting Countries (OPEC) and was set up with the intent of coordinating policy and to act as a framework of action for Africa in the energy sector.

Education and training Much effort is being made to promote petroleum expertise in Congo by Total, ENI and other oil companies. In new projects, there may be opportunities to further build legal framework and contracts to drive existing training and

human resource policies. The Congo national oil company can continue to focus its attention on training and hiring of experts in different fields. Countries will continue to initiate and implement nascent local content policies. The transfer of technology and international oil company cooperation in research and development is always on the agenda.

National oil companies Since April 2008, the World Bank has been studying national oil companies and value creation. The study will analyze factors that explain the creation of value and test their relative importance on the basis of the experience of a selected group of national oil companies. The dynamics of the oil industry, said the World Bank, involves changing conditions with respect to prices, technology, competition and management techniques, and this requires nimble decision-making processes that might not be compatible with all state-owned enterprises.

Biofuels Congo has joined Brazil in calling for a Pan-African biofuel alliance.

Brazil recently signed two agreements with Congo to provide the African state with training, technology and financing to produce biofuels from sugar cane and palm oil. Brazil is studying a formula that will transform debts into Brazilian investments in Congo.

Last month, Britain and Norway announced a large financial contribution to the launch of a Congo Basin Forest Fund aimed at helping the inhabitants of the Congo rainforests to protect their environment.

Environment and regulations Environmental concerns related to oil sands projects range from the environmental impact assessment before the implementation of such a project to the management of air and water pollution during the life of the project and 68 | CIM Magazine | Vol. 3, No. 6

eye on business rehabilitation of the site. While international environmental agreements promote sustainable development, environmental protection is essentially established by domestic legislation.

Carbon credits market Africa’s carbon credits market lags behind in comparison with India, China and South American countries.

As a member of the Kyoto Protocol on climate change, Congo offers opportunities for foreign companies implementing greenhouse gas emission reduction projects to trade the certified emission credits resulting from such a project, if all the requirements are satisfied. An all-African carbon forum will be held in Senegal in September.

Mine closure The Congo oil sands project allows oil companies, government and banks to identify situations for the new era.

The process of closure of oil sands

operations, the release of company responsibility from the mining side, and the rights of landowners and communities around the mine are driven by applicable contracts and legislation.

Normally, mine closure requirements occur either within the applicable mining law and its associated implementing rules and regulations, or within the specific environmental legislation, which is applicable to the mining sector or both.

Extractive Industries Transparency Initiative

Conclusion There are other African countries such as Nigeria where oil sands development is now a possibility. The world will follow with interest the development of the ENI project in Congo to determine how these multi-faceted oil projects will work in practice. CIM Florence Dagicour (Montreal) and Mutoba Mpinga (Lubumbashi, DRC) of Fasken Martineau DuMoulin LLP assisted in the preparation of this article.

In February 2008, the Congo was accepted as an Extractive Industries Transparency Initiative candidate country and now must go through the process of validation. EITI aims to strengthen governance by improving transparency and accountability in the extractives sector.

About the author John Vercoe is a partner in Fasken Martineau DuMoulin LLP (London). A serious malignant melanoma six years age, duly beaten, has not gotten in the way of John completing nearly 30 years working in law in the oil and gas sector.

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student life The university-industry symbiosis: an international student’s perspective As an international student from Germany attending the University of Alberta on a one-year student exchange program, I have been introduced to the Canadian mining industry and its great potential. One of the things my experience has taught me thus far is that my field of study offers one of the most valuable and competitive degrees available, which bodes quite well for future career opportunities.

Consider the following. In 2006, the mining industry accounted for six per cent of Canada’s economy. In Alberta, production of oil sands reached 1.3

by Robert Ritter million barrels per day in 2007, representing 50 per cent of Canada’s total crude oil production.

Canada exports over 28 million tonnes of coal each year to more than 20 countries,

Robert (right) with fellow student preparing oil sands for cyclic tests.

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70 | CIM Magazine | Vol. 3, No. 6

student life generating an accumulated profit of $5 billion. Currently, Alberta’s oil sands companies invest $75 to $100 million annually in research and development, and these numbers are predicted to rise. It is, therefore, no wonder that the industry targets the University of Alberta’s mining program. The future of the mining industry rests in the hands of the current students.

The mining industry is indeed closely allied with the university. Not only do they seek to hire University of Alberta mining graduates, but they also aim to improve their prospective employees’ learning of the newest techniques in research and technological advances. In supporting the education of students by helping pay for professional laboratory equipment, computer labs and other facilities, the industry actually invests in a future driven by professionally trained, highly capable employees.

Students at the University of Alberta are offered an enriched educational experience. The industry provides outstanding opportunities for employment — summer jobs, co-op and research programs in their fields of study — a critical component of advanced technical education.

Students value and benefit from the opportunities to apply their theoretical knowledge in the field as it enhances their competencies and future employment prospects. At the same time, the educational gains students make eventually flow back to the industry, making its involvement with the faculty a concrete investment.

To quote a fellow student: “Without industry’s involvement with our faculty, our program would fail miserably.”

As the pieces tie together, industry depends on students and faculty for future exceptional employees, and the students and faculty depend on industry for a complete higher education experience.

In this dynamic relationship, industry’s extensive participation is directly visible to students at career fairs, conferences, guest lecturers and industry nights — events that bridge the gap between engineers-in-the-making and “already-made” industries. Industry partners also provide the necessary “in kind” resources that build a foundation for research. These include samples of oil sands, suspensions, dragline ropes, tires and core samples for hands-on undergraduate and graduate studies. The research experience students gain gives them a taste of the real challenges they will encounter as full-fledged professionals.

At the same time, they are able to develop new designs and techniques that could solve some of today’s pressing industry issues.

The University of Alberta offers the degree while the industry provides the practical knowledge and support needed to make the mining program possible. This synergistic partnership, along with the industry’s generous contributions, are what make for an above-average level of education, producing mining engineers who will lead mining’s flourishing future.

University involvement means jobs for U of A students Permanent jobs 100% placement by graduation every year since 1990.

Percentage of U of A students who obtained summer and co-op jobs in the mining industry: 2002 — 93% 2003 — 83% 2004 — 100% 2005 — 100% 2006 — 100% 2007 — 100% 2008 — 90%+* * 100% expected by the end of May

A typical mining student graduates

debt free!

Of course, such opportunities are only possible with strong support and guidance at the program level. I have had the privilege of working under the mentorship of Dr. Tim Joseph, who has had a profound impact on both my current and future career goals. I was fortunate to encounter industry partners while volunteering at the CIM Conference and Exhibition, which allowed me to find out more about myself, my ambitions and dreams for my future. After my year in Canada, I’m excited about heading back to Germany this fall to complete my degree and to the many opportunities that lie ahead. Whether my choice is to continue with innovative post-graduate studies or to go to work in Canada’s vibrant mining industry, I know that options are plentiful and that nothing is impossible! CIM

About the author Robert Ritter is a fourth-year economical engineering exchange student majoring in mining. His program includes an eight-month school term and a four-month work term as a research assistant at the University of Alberta. His hobbies include travelling, soccer and photography.

September/October 2008 | 71

HR outlook The Virtual MineMentor Program Modernizing mentorship to address today’s skills shortage The mining sector is facing critical shortages of skilled workers. One of several factors contributing to this crisis is the dramatic rate of attrition in mining-related programs at Canadian colleges and universities.

The 2005 Prospecting the Future sector study revealed that there was a 28 per cent attrition rate in certificate programs and a

by Melainie Sturk 7.4 per cent attrition rate in undergraduate degree programs.

As identified in the Ontario Ministry of Training, Colleges and Universities Employment Profile: 2000-2001, graduate outcome surveys indicate a significant loss of mining graduates to other sectors of the economy. For example, the Ontario

College Graduate Profile for 2000-01 revealed that only 39 per cent of graduates from mining programs at Cambrian College, Northern College and Sir Sandford Fleming College were working in a field related to their program of study.

Mentoring should be a key component of any comprehensive recruitment and retention strategy.

MiHR, through the Mining Industry Attraction, Recruitment and Retention Strategy (MARS), is developing a unique mentoring program to mitigate this problem.

MiHR’s mentoring program will facilitate relationships between post-secondary students in miningrelated disciplines and outstanding industry employees. Mentors and

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mentees will be matched based on synergies between the career goals, mentorship goals and field of study of the mentee, and the career experience, position and mentorship goals of the mentor. Establishing an early link to the mining industry is critical to improving sector exposure and thereby decreasing mining-related program attrition rates.

Mentors will provide students with general guidance as well as workplace knowledge, thus creating a stronger bridge from school to work.

Traditionally, mentorship requires the matched mentor and protÊgÊ to spend time together, in the same physical space. MiHR’s Virtual MineMentor Program will operate by means of virtual mentoring, which allows participants to communicate over long distances and in real time.

MineMentor will be centralized through an online portal, where communication occurs via web forums, email, community message boards, blogging, etc. Because virtual mentoring requires little to no face-to-face contact, it is the optimal choice when connecting participants in remote areas. This type of mentoring is also beneficial because it increases the frequency and speed of communication.

V-mentors will receive guidance through training developed by MiHR and an industry steering committee to provide professional, quality mentoring to their respective protĂŠgĂŠs. They will have ongoing access to support from the MineMentor coordinator and resources on the MiHR website. The V-mentor will: provide general guidance, support and advice; promote the exploration of career possibilities within the minerals and metals sector; be a first point of

HR outlook contact for networking within the industry; and act as a role model.

Mentors should have excellent communication skills, be open and tolerant and, most importantly, they should possess an infectious love for their work and sector. They must be willing to invest their time to inspire and engage.

Research shows that mentors realize the great value that is intrinsic in guiding their protĂŠgĂŠs. The pride and gratification experienced by the mentor can also result in increased retention and in an improvement in their perception of their employer. They truly make a difference.

According to the Government of Canada: “In organizations with mentoring programs there is a greater sense of belonging, loyalty,

encouragement for all employees to grow and be recognized by someone other than within their working group.�1 MiHR’s program will undergo a pilot phase with engineers from September to December, 2008.

Findings from the pilot will be incorporated before broadening the participant base and making the service available in French. As with all MiHR projects, the Virtual MineMentor Program is being developed under the guidance of a national steering committee that includes signifi-

cant industry representation. The program is thus being created by the industry for the industry. CIM MiHR is looking for outstanding industry employees in the engineering field to help pilot MineMentor. Contact MiHR at minementor@mihr.ca

About the author Melanie Sturk is the project manager for the Mining Attraction, Recruitment and Retention Strategy project at MiHR and Explore for More. Melanie holds a Bachelor of Recreation Management from Acadia University and a certificate in Project Management Essentials training from the University of Toronto.

1 Mentoring

Programs in the Federal Public Service: Government of Canada. Found online at: http://www.psagencyagencefp.gc.ca/hr-rh/hrtr-or/mppssbp-pmespe1_e.asp#28.

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September/October 2008 | 73

standards Canadian Standards for Valuation of Mineral Properties Mineral property valuations are carried out for a variety of reasons, such as mergers and acquisitions, non-arm’s length transactions, initial public offerings of stocks, support of audited financial statements, fairness opinions, determination of vendor considerations, litigation, expropriation, income tax matters and insurance claims.

The CIMVal Committee was formed in 1999 to review and advise on approaches to the valuation of mineral properties. CIMVal is a special committee of CIM formed on the recommendation of the Mining Standards Task Force of the Toronto Stock Exchange and the Ontario Securities Commission.

After solicitation of views and consultation with various interested parties, the CIMVal Draft Standards and Guidelines for Valuation of Mineral Properties were released for comment in February 2002 and were finalized in February 2003. CIMVal’s objective was for the standards to be used by the mining industry in general and to be adopted by Canadian securities regulators and Canadian stock exchanges. To that end, the standards contain many of the definitions and concepts of National Instrument 43-101, Standards of Disclosure for Mineral Projects, which came into force in February 2001.

The intent of the CIMVal Standards and Guidelines is that mineral property valuations be carried out by appropriately qualified individuals and that all relevant information be fully disclosed.

It consists of two parts: stanby William E. Roscoe dards, which are and Deborah McCombe mandatory in the valuation of mineral properties, and guidelines, which elaborate on the standards and provide guidance and recommendations for the valuation process and for reporting.

Key features of the CIMVal Standards and Guidelines are: • They cover the valuation of mineral properties but not of corporations.

74 | CIM Magazine | Vol. 3, No. 6

• They cover metallic and non-metallic mineral properties, both subsurface and surface, and energy fuels. Oil and gas properties are not covered.

• Value refers primarily to fair market value.

• The basic principles are materiality, transparency, independence, competence and reasonableness. Other general valuation principles are outlined in the guidelines.

• A Qualified Valuator (QV) is responsible for the overall valuation and may be assisted by or rely on a Qualified Person (QP) for various aspects. Both the QV and QP must be professionals with at least five years of relevant experience and must belong to a self-regulatory professional organization.

• All technical input to a valuation, including mineral reserves and mineral resources, must be verified by a QP. • The entity commissioning a valuation must reasonably establish that the QV is sufficiently qualified, competent and independent. Similarly, the QV must be satisfied with the credentials of any QPs involved in the valuation.

• The QV has the responsibility of deciding which valuation approaches and methods to use.

The three standard methods of income, market and cost must be considered, and the market and one other approach should be used. Various valuation methods under each approach are discussed in the guidelines, along with comments on their general acceptability.

• The valuation must be reported as a range of values to reflect the uncertainty of the valuation process.

• The valuation must be reported in a valua-

tion report that sets out, among other things, the key risks and assumptions used. The guidelines recommend a table of contents for the valuation report.

• Mineral reserve and mineral resource estimates must be disclosed, and must follow CIM categories and definitions, or other non-Canadian categories as set out in National Instrument 43-101.

• For income approach methods, such as discounted cash flow, it is generally acceptable to use all Proven and Probable Mineral Reserves, and to use mineral resources that a QP states are likely to be economically viable and for which the higher risk is recognized in the valuation by some appropriate means.

• The valuation date must be specified and all valuations within the previous 24 months must be discussed.

• The valuation report must include certificates of qualifications for the QV and any QPs involved, and a statement that the valuation complies with the standards and guidelines.

The CIMVal standards can be found on the CIM website under Standards and Guidelines. CIM

About the authors Bill Roscoe is a consulting geologist and principal with Scott Wilson Roscoe Postle Associates. He is cochair of the CIM Valuation of Mineral Properties Committee and serves on a task force of the International Valuation Standards Committee.

Deborah McCombe, executive vice president of Scott Wilson Roscoe Postle Associates, is a consulting geologist who is strongly involved in Canadian disclosure standards for the mining industry.

the supply side

The challenge of statistics and forecasting for mining equipment sales At CAMESE, we often receive enquiries for statistics that define the size of markets by country, product or service. All marketers want such statistics to plan growth strategies and justify marketing plans and expenses.

And yet, it is difficult to find useful, product- or service-specific statistics for sales to the mining industry, either in Canada or worldwide.

Some information for Canada is available at http://www.ic.gc.ca/epic /site/tdo-dcd.nsf/en/Home where you can search for data by North American Industry Classification System (NAICS) codes. Part of the problem is that information that one would like for the mining industry is bound up with that for other sectors like construction or oil and gas.

Such groupings make the data difficult to use by marketers interested in a specific product.

For example, NAICS code 333130 covers “mining and oil and gas field machinery manufacturing.” A search of this code for Canadian imports from all countries shows that they rose from $698 million in 2003 to about $1.236 billion in 2007.

Manufacturing shipments (the value of goods and services produced in Canada) for the same code rose from $728 million in 2003 to $1.893 billion in 2007.

Another approach to

by Jon Baird data for the Canadian market is information kept by Natural Resources Canada in their Minerals Yearbook. The chapter on “Mineral Exploration, Deposit Appraisal and Mine Complex Development Activity” goes into considerable detail about capital expenditure by mining companies.

For this information, visit http://www. nrcan.gc.ca/ms/cmy/pref_e.htm.

Yet another reference is the Canadian Mining Sourcebook.

Published annually, the sourcebook is a highly detailed and reliable report on the supplies, equipment and mining methods used by active mines and mineral processing plants in Canada. For your copy, go to www.miningsourcebook.com.

World demand for mining equipment is expected to grow by 5.9 per cent annually through 2011, according to a recent report entitled “World Mining Equipment” issued

by The Freedonia Group Inc. Global demand for mined commodities will push the annual spending on mining equipment to US$33.6 billion by 2011.

According to Freedonia, production of heavy mining equipment is dominated by the United States, Western Europe and Japan. Such countries have a long history and extensive expertise in the development of capital equipment industries of all types, many of which have leveraged this expertise to produce mining machinery. China is emerging as a major producer, due in large part to the needs of its own growing industry, but also to becoming a net exporter, shipping products to both developing nations and mature markets such as the United States.

Freedonia says that China is increasing its production of iron ore, bauxite and coal, India is expanding coal production and Australia’s production of bauxite and iron ore is growing. These trends are driving the demand for heavy equipment in

A page for and about the supply side of the Canadian mining industry the Asia-Pacific markets. Africa will post healthy gains, benefiting from rising demand for precious metals and copper. Growth in demand for mining equipment in Latin America will reflect increased investment in nations like Brazil, Peru and Chile.

Eastern Europe will also post gains, benefiting from gains in the large Russian market. Growth in North America will lag behind the industry

World demand for mining equipment is expected to grow by 5.9 per cent annually through 2011 average, reflecting the maturity of these markets.

The Freedonia report presents historical demand data as well as forecasts for six regions and 33 countries. It examines market environment factors, company market share data and profiles 25 global industry competitors. For more information, visit http://www.fredoniagroup.com/world-mining-equipment.html. CIM

About the author Jon Baird is managing director of CAMESE and president of PDAC.

September/October 2008 | 75

first nations Canada’s own Tibet?

During a recent teleconference call with associates in Central America, someone made a comment regarding the imprisonment of aboriginal leaders from Kitchenuhmaykoosib Inninuwug (KI) and how this showed that the government of Canada will go to any length to advance its industrial agenda, even if it means the oppression of aboriginal people. This individual went on to compare the policies of our government to those of China imposed in Tibet. I found that I couldn’t really counter these comments because, although extravagant, they were partially factual.

On March 18, 2008, six KI band members, including the community’s Chief and Deputy Chief, were sentenced to six months in jail over an ongoing dispute between the community and Platinex, an exploration company conducting work in the region. This deciby Juan Carlos Reyes sion did not take place overnight. I have been closely following this case since 2005 when KI First Nation and other communities in the region first declared a moratorium on mining exploration in the Far North.

Around the same time as the moratorium was announced, Platinex made a deal with Inco to acquire a

number of mine leases in the Big Trout Lake region, which is in the traditional territory of KI. Even though there was a moratorium in effect, Platinex carried on with its exploration work, claiming its rights under the Ontario Mining Act, which provided the permission required to carry out this exploration. KI community members and leadership began peaceful protests that escalated to the point where the workers had to leave the exploration site. This continued until Platinex launched a $10 billion lawsuit against the community and an injunction to prevent KI from interfering in the company’s exploration program. Initially, the court sided with the community, noting that the company knew the risks involved in carrying out work in the region and mandated both parties back to the negotiation table.

In October 2007, a court ruling was made that allowed Platinex to begin drilling in the territory without obstruction or protest. The community breached this ruling and, as a result, six band members were sentenced to six months in jail.

This case study exemplifies the need to review and revise the current Ontario Mining Act. The old days of the gold rushes when anybody could stake a land claim on Crown land, buy a license and begin mining are long gone.

The provincial government’s lack of action in this matter has given the mining and exploration industry a black eye.

Some organizations and communities have formally condemned the decision to incarcerate the band members.

Platinex has also issued a statement affirming that they had not sought the incarceration of the KI members.

Today, we need to take into account the often forgotten treaty rights held by aboriginal communities. Now, more than ever before, we need to begin looking at these communities as long-term partners, right from the project development stage. The province of Manitoba is a shining example for Ontario. Its program, championed by the Minister of Science, Technology and Mines, requires every exploration or mining venture to identify if there is aboriginal interest in the region, and, if so, to work with the ministry to engage and accommodate the aboriginal communities.

Gladly, not every mining and First Nations negotiation goes as sour as this one did. CIM

About the author Juan Carlos Reyes is the organizer of the annual Learning Together conference and an aboriginal consultant with Efficiency.ca. He is passionate about human rights and works tirelessly to help improve the lives of Canadian aboriginal people.

76 | CIM Magazine | Vol. 3, No. 5

MAC economic commentary Turbulent times on the international scene Times remain quite good within the global mining industry. There is no shortage of challenges to be sure, ranging from a dearth of workers to mounting social license issues.

Nonetheless, the enduring strength of mineral prices continues to drive the industry. Nickel prices grew from $3 per pound in 2002 to $17 in 2007, and copper from 70 cents to over $3. Gold and silver are at prices not seen in decades. The result is record mineral exploration spending, high capital investment, and buoyant stock prices and mergers and acquisitions activity. Demand from emerging economies will continue to drive strong mineral prices in future years.

In this context, a key challenge for the industry worldwide relates to increased international turbulence as governments of many countries aim to capture a larger share of the overall mining revenue streams. Towards this end, governments in many regions are taking a range of actions and, in some cases, following questionable processes. For example: • Ecuador cancelled 88 per cent of concessions, suspended mining for 180 days and imposed a 70 per cent windfall profit tax. These actions affected hundreds of mining concessions and negatively affected the prospects of companies such as IAMGOLD. • Mongolia has introduced windfall profit

by Paul Stothart taxes on copper and gold and amended its mining law to allow the government to back into strategic mines with a majority stake. This affected the Oyu Tolgoi development and firms such as Rio Tinto and Ivanhoe.

• Zambia is considering increasing its windfall tax on copper exports, in order to generate $400 million in additional government revenue.

The Democratic Republic of Congo is examining 61 mining contracts with the aim of increasing the government share.

• Argentina has imposed a tax increase on exports — an action which may lead to lawsuits from several mining firms.

In Venezuela, spending by the world’s exploration firms has declined by 60 per cent in response to the nationalist Chavez revolution. In turn, neighbouring Bolivia has spoken of a desire for “nationalization without expropriation.”

• The governments of Uzbekistan and Russia have presented numerous tax and equity control challenges to foreign investors in recent years. The Kyrgyz government has proposed new taxes and possible state consolidation affecting many investments, including Cameco’s Kumtor gold project.

Beyond these proposed and enacted government changes, other risks continue to emerge in important mining countries. For example, Chile has mounting concerns over the availability of water and aims to more actively monitor water extraction levels associated with specific mine sites. Concerns also exist regarding the availability of energy in northern Chile, given reduced natural gas imports from Argentina.

South Africa has also encountered significant electricity supply problems — uncertain supply is hindering the ability of mining companies to operate at normal levels of production.

It is critically important for countries that wish to attract business investment to maintain an attractive investment climate — with transparent and stable rules and a modern and efficient

infrastructure. While governments are certainly entitled to their fair share of revenues on behalf of their citizens, it is important that any revenue changes be made with fairness and consistency and in full consideration of the fact that global business costs for capital, labour and equipment have increased sharply in recent years. Mineral prices have climbed — so have the costs associated with accessing and processing those minerals.

As a general principle, members of the Mining Association of Canada support open flows of direct investment — inward and outward — as these enhance access to new technologies, concepts, markets and production chains. Mining companies will continue to invest around the world in order to acquire reserves and landholdings and broaden their technical skills and ability to find more deposits.

The Canadian government can help mitigate the risks associated with these business investments abroad by negotiating bilateral investment treaties, double-taxation agreements and free trade agreements. For their part, global companies must continue to invest in the legal and financial protections that they need to operate successfully in turbulent times. CIM

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.

September/October 2008 | 77

safety Safety is no accident This year’s John T. Ryan Safety Awards have once again proven that the mining industry’s commitment to safety is tried, tested and true. The pursuit of perfect safety has one ultimate goal: zero — zero accidents, zero incidents and zero lost person-hours. Achieving such a goal requires sustained commitment. It does not come by accident.

Nowhere is this more evident than at the Iron Ore Company of Canada (IOC), this month’s featured winner of the John T. Ryan Safety Award in the East Select Mines category.

IOC is Canada’s largest iron ore producer and a leading global supplier of iron ore pellets and concentrates. Their products are often used by steelmakers to improve quality and productivity and reduce greenhouse gas emissions.

The 53-year-old company is headquartered in Montreal, and has over 1,900 employees throughout

by Carolyn Hersey Newfoundland and Labrador and Quebec.

With so many lives directly connected to its work, IOC takes great care and consideration when it comes to their employees’ and contractors’ safety.

78 | CIM Magazine | Vol. 3, No. 6

IOC programs spell safety success.

At IOC, it is both set standards and specific programs r cord ha imp ove ons thatIOC’s have afety spelled safety success. “There hasl been a fundamental culture shift when it comes to safety at IOC that was initiated with the introduction of our Minimum Safety From 2001 2007, IOC s L Tof health, nj Standards,” saidt Michael Tost, educ general imanager safety and environment. is consistently 398Every 25.employee h ’ 94% p ove involved in a wide variety of safety programs. For example, Health, Safety and Environment Interactions focus on behaviour, while the Take-5 program focuses on risk assessment and mitigation. The Hazard, Accident and Incident Review focuses on learning from experience, while planned general inspections, along with weekly tours, focus on work and environmental conditions.

Tost added that the company “has not only placed a high priority on safety interactions, but on overall wellness. Along with health services like a wellness program, which includes clinics to test blood pressure and glucose, and providing free influenza vaccine to all employees, there are also medicals and fitness testing provided.”

Recently, IOC has begun offering a pregnancy awareness program to expectant mothers throughout their pregnancy. The program provides information on workrelated hazards, health counselling, proper lifting techniques, and so on.

IOC’s reach extends far beyond their own walls, out into the community, to promote safety through programs and initiatives.

Isolation Awareness Month: August is Isolation Awareness Month at IOC’s Labrador City operations. In August 2007, one new safety message was delivered three times daily on the local radio station as well as to employees by their leaders. These safety messages focused on personal isolation locks, hazardous energy, parking vehicles and isolation officer training.

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Labrador West Joint Buoy Committee: In 2006, IOC donated $12,000 to the Labrador West Joint Buoy Committee. Their partnership with the local boating assoSafety Interactions ciation continued in 2007. This funding is used for the 2001 to 2007 annual installation of the “Aids to Navigation” buoy 30000 marker system for safe boating, research and monitoring.

25000 Forty-four buoys were purchased to be installed on 20000 Wabush Lake every June and taken out in November.

15000 Safety Snowmobile Campaign: Originally, IOC promoted 10000 safety along the railway as part of its legal obligation. Now, 5000 the obligation has turned into an ongoing safety campaign.

0 Both the Labrador City and Sept-Îles locations organize 2001 2002 2003 2004 2005 2006 2007 safety campaigns that are featured on local TV and radio stations and in newspapers. Posters and ads are created to encourage safe driving and recreation along the railway. In 2008, IOC is adding a new focus to the campaign — allterrain vehicles, fishing, boating, and skiing. In partnerSafety Performance – LTI Trend ship with the Royal Newfoundland Constabulary, IOC also 2001 to 2007 paid the lease on a new snowmobile.

120 117 All this and more are what make up IOC’s approach to 100 adopting new practices and implementing minimum 80 safety standards. Tayfun Eldem, vice president of operations and engineering, believes that its approach helps 60 “address the fundamental safety issues in our industry and 40 35 34 establish a definitive baseline for performance.” IOC 23 22 20 16 strongly encourages employees to speak up about safety.

7 To aid in voicing safety concerns or ideas there are a num0 2001 2002 2003 2004 2005 2006 2007 ber of safety programs that are interactive in nature: safety talks involve facilitated group discussion sessions; Take 5 procedures require ongoing assessment of work conditions; safety interactions provide one-on-one assessIncreased safety interactions improve safety performance. ments of potential hazards and risks; and a new LEAN sysSteps to completing Safety Interactions tem helps to eliminate waste, which in turn assists in safer work activities.

When?

What preparation (i.e..:. Review Standard Procedure) Plan/Prepare Where?

Who With?

All safety initiatives at IOC are designed to What Have some messages, expectations and safer habits that you want highlighted ensure employees are equipped with the knowledge and tools necessary to work safely and to reinforce the minimum safety standards.

Observe Use all senses Look above, below, behind and at the work activity as well as the work process Eldem acknowledges that “establishing these Look for safer as well as less safe behaviours standards as part of our everyday work was not an easy process. It took time and perseverance Gain commitment to work safer Introduce yourself Discuss but ultimately the issue of ‘minimum acceptComment on safer behaviours Discuss other safety issues Discuss (using mostly open-ended questionsThank the person able level of performance’ took hold.” The difconsequences of less safe behaviours ference — application of minimum safety stanSelf reflect on debrief with co-auditor dards in all jobs, in all areas and at all times — Coach subordinates and receive feedback Review/Debrief Review what went well and what could be improved next time is remarkable in terms of what IOC does today compared to what it did in the past. The results show that a little change can go a long way.

From 2001 to 2007, IOC reduced its lost time Record Actions agreed to and key safety behaviours and less safe behaviours noted and recorded injuries from 117 to seven, and medical treatment cases from 398 to 25. That amounts to a 94 per cent improvement rate. It truly is no Ensure work groups use data for improvement Follow up accident that the Iron Ore Company of Canada Ensure key actions are carried out Opportunity to review documented SI’s of subordinates has earned a prestigious laurel for its safety record. CIM Steps to completing safety interactions 1

1

September/October 2008 | 79

parlons-en L’atelier sur les mines de Kuujjuaq : un vif succès pour une première édition L’atelier sur les mines de Kuujjuaq 2008 (Kuujjuaq 2008 Mining Workshop), du 12 au 14 mai 2008, a été un vif succès. L’événement, qui s’est tenu à Kuujjuaq, a permis de réunir environ 70 participants provenant des compagnies minières d’exploration et d’exploitation, des firmes de services et d’ingénierie, du gouvernement du Québec et des milieux administratifs régionaux et municipaux du Nunavik, dont plusieurs maires des villages inuits. L’atelier a été organisé conjointement par Jean-Marc Séguin, directeur technique du Fonds d’exploration minière du Nunavik (FEMN) et Serge Perreault du Ministère des Ressources naturelles et de la Faune du Québec (MRNF). Le but de cet atelier était de réunir tous ces participants afin de créer des liens et des opportunités de partenariat, de fournir une information de qualité et adaptée sur le développement minier par la présentation de conférences et d’offrir une tribune aux Inuits afin qu’ils expriment leurs préoccupations et leurs perceptions de l’activité minière qui se déroule sur le territoire du Nunavik.

L’ouverture de l’atelier a débuté avec une prière récitée par le président d’honneur de l’événement, M. David Okpik, un prospecteur inuit reconnu par ses pairs au Nunavik et très impliqué dans sa communauté. Le maire de Kuujjuaq, M. Larry Watson, et les présidents de la Société Makivik et du Fonds d’exploration par Serge Perreault minière du Nunavik, messieurs Pita Aatami et David Epoo, ont prononcé les allocutions d’usage pour un tel événement.

Dans leurs allocutions, ils ont noté l’effervescence de l’exploration minière qui se déroule actuellement sur le territoire du Nunavik, de l’importance des retombées économiques qu’apporte le développement minier, et des perspectives d’emploi pour les jeunes de ces 80 | CIM Magazine | Vol. 3, No. 6

communautés. Ils ont également mentionné que le développement minier doit se faire en respect de l’environnement, du mode de vie et de la culture inuite.

Onze conférences ont été présentées par des représentants du MRNF (Géologie Québec, Direction des Affaires autochtones et Direction générale du Nord-du-Québec), des compagnies minières (Xstrata Nickel, Anglo American Exploration Canada, Canadian Royalties, Areva-Québec et Azimut Exploration) et d’une firme de génie conseil (GENIVAR). Tous les domaines du développement minier ont été abordés dont le rôle du gouvernement dans le développement minier, les différentes phases du développement minier et de son financement, les activités d’exploration minière et de mise en valeur réalisées sur le territoire du Nunavik, la démystification de l’uranium, et finalement le respect de l’environnement et l’obtention des permis à toute les étapes du développement minier. Les présentations s’adressaient à une audience peu familière avec le domaine minier. Le cycle de conférence s’est terminé par une présentation de Glenn Mullan (Canadian Royalties) sur l’importance d’établir des liens étroits avec les communautés inuites dès le début du processus d’un développement minier.

La première journée s’est terminée par une plénière où plusieurs représentants des communautés inuites ont exprimé certaines craintes, quant au respect de l’environnement et les impacts sur le caribou, liées aux déroulement de travaux d’exploration minière sur le territoire du Nunavik. Les communautés demandent également à l’industrie de poursuivre ses efforts quant à la réhabilitation

des sites abandonnés d’exploration minière par l’entremise du programme du Fonds Restor-Action. Certaines personnes ont également exprimé le souhait de voir les compagnies minières embaucher plus d’inuits et que les communautés bénéficient des retombées économiques de cette activité. Cette première journée s’est conclue par un excellent souper à saveur locale au cours de laquelle une plaque commémorative a été remise au président d’honneur, M. David Okpik.

La deuxième journée était consacrée à un atelier présenté par le MRNF sur l’utilisation de GESTIM et à la visite des kiosques de compagnies d’exploration minière (Mines d’Or Virginia, Ressources Majescor, Canadian Royalties) et d’entreprises de biens et services locales (dont Air Inuit, Administration régionale Kativik, Nuvumiut, Nova EnviroCom).

Le but de cet atelier était de permettre aux représentants des corporations foncières d’utiliser GESTIM afin de localiser et d’identifier les titulaires de droits miniers sur le territoire du Nunavik. Finalement, lors d’une dernière plénière, il a été décidé de mettre à jour et d’ajouter du contenu au guide des lignes directrices sur la réalisation de travaux d’exploration minière au Nunavik. Ce guide, qui sera rédigé et publié par le Fonds d’exploration minière du Nunavik, est destiné aux compagnies minières désirant réaliser des travaux d’exploration et aux représentants régionaux du Nunavik. CIM

L’auteur Serge Perreault est géologue et adjoint au directeur général de Géologie Québec au Ministère des Ressources naturelles et de la Faune. Depuis juillet 2008, il est le vice-président du district 2 (Québec) de l’ICM.

The life and death of the Tough-Oakes mine

by Dan Zlotnikov

The beginning

Oakes and the Tough brothers arrived in the town of Swastika in early 1911. At that time, the brothers were hauling goods for the mining and exploration industry in Cobalt. As the exploration moved north, they moved with it and learned about the mining trade as they went.

Oakes, on the other hand, was an old hand at gold prospecting. By the time he arrived in Swastika, he had

Photo credit: Museum of Northern History

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here are many stories — both of success and failure — linked to the mining boom that engulfed Cobalt, Ontario, and the surrounding area early in the 20th century. But likely the best-known of them is that of Sir Harry Oakes and the Tough brothers and the ToughOakes mine. Despite becoming very successful and prosperous, Oakes’ fame comes not from his achievements as a gold miner but from the mystery of his death — the millionaire’s charred body was found in his Nassau home on July 8, 1943; his murderer was never found. But for Sir Harry Oakes, the millionaire’s journey began when he was merely Harry Oakes the prospector, staking claims with the four Tough brothers.

Most of the written record found today “deals with the Tough-Oakes story as a sidebar to the tale of Harry Oakes’ life and sensational murder,” wrote George Wallace Tough, the grandson and namesake of the youngest of the Tough brothers.

Fortunately, Tough Jr. was able to find much more detailed records of the mine’s financial state, mostly in headlines from the Northern Miner. In these, the turbulent story of the mine is quite evident.

George Tough

been to the Klondike, the Belgian Congo and even Australia. But, like most prospectors of that time, Oakes’ experience and efforts had not yielded the hoped-for riches. The brothers had worked with Oakes to get by, but were mainly biding their time until the claims were to open.

On January 27, 1912, George and Tom Tough met with Oakes and set out to stake their first claims.

“It was 56 degrees below zero that night when we set off on snowshoes to travel the six miles by trail to the claims,” recalled George in a 1934 interview. “I think Oakes had on about five pairs of pants and we had a few pairs too.” In the dark of night, the partners staked three claims in Oakes’ name and two in Tom Tough’s.

The Tough-Oakes mine was born.

The prospecting The partners immediately began prospecting on the site and George

was fortunate enough to find two narrow but rich gold-bearing veins shortly thereafter. The brothers wrote to Oakes, who had gone to Maine to try and sell the claims, on the basis of their location, for $1,200. After Oakes returned, tests showed spectacular values of over $1,200 per ton, at a gold price of $20 per ounce.

The Ontario Department of Mines agreed with the partners’ optimistic view, saying that “no other property in the camp” contained surface showings of such richness and size. This was particularly remarkable given that its extensive deposits had earned the area the name “Mile of Gold.”

Rich as they were, the veins were narrow and hard to follow, tended to dip into neighbouring claims and were often cut off by faulting. This dissuaded many an investor and the mine seemed doomed to financial troubles even before being built.

Nonetheless, the partners persevered and turned down offers to buy the claim, including one as high as $125,000. The first sign of respite was an investment by Clem Foster, whom the Tough brothers had worked with before. Foster was an engineer by trade, an experienced mining entrepreneur and, at the time, the mayor of Haileybury.

Due to the size of Foster’s investment and his expertise, when ToughOakes Gold Mines Limited was formed in 1913, Foster became the largest shareholder and the company president.

The beginning of the end But the geological complexities of the deposit meant that it would take a greater investment before the mine returned a profit. Faced with a lack of September/October 2008 | 81

mining lore

Harry Oakes with the Tough brothers and fellow prospectors. Photo credit: Museum of Northern History

interest from U.S. and Canadian investors, the partners turned to Foster once more. Foster was asked to go to London, England, to find buyers for a large number of the company’s shares.

There is no clear record of what transpired in London, but soon after, Foster found himself named as the defendant in a series of suits brought on by a company he was negotiating with, Kirkland Lake Proprietary Limited. While the suits were pend-

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82 | CIM Magazine | Vol. 3, No. 6

ing, the court forbade Foster from voting in shareholder meetings.

Back in Canada, the London fiasco drew ire from the shareholders, who felt that Foster had underpriced the shares and traded shares belonging to Harry Oakes’ relative. This caused another suit to be filed against Foster and a shareholders meeting to be called in January 1916. At that meeting, the shareholders voted to remove Foster as president and dismiss the

company’s directors. Foster, his shares still frozen by the court, was unable to vote. The Tough brothers did not attend due to a court injunction and were dismissed from the board. Harry Oakes, joining the dissenting shareholders, was elected as the new president.

Despite Foster claiming that the meeting did not achieve quorum and was thus illegal, the Ontario Supreme Court upheld the dismissals and, in a March 1917 decision, confirmed that Foster and the Toughs no longer had any control over the company’s future.

The aftermath Despite the lawsuits, Kirkland Lake Proprietary Ltd. eventually acquired a controlling interest in Tough-Oakes Mines Ltd. But the damage was already done and production at the mine remained sporadic. As the richer veins were exhausted and deeper mining required more investment, the company struggled with the financial burden. In the end, the company closed the mine, defaulted on its recently issued $250,000 in bonds and declared bankruptcy. Having produced nearly $3,000,000 worth of gold and silver, the first of the Mile of Gold mines was no more.

Both the Toughs and Harry Oakes continued staking claims while starting up the first mine. It was that second round of claims that were to become Oakes’ Lake Shore mine and bring Harry untold riches. As luck would have it, the Toughs sold the claims staked during the ToughOakes mine operations for $7,000.

These were later sold back to Oakes for the enormous sum of $30,000 and 50,000 shares in the Lake Shore operation — shares that rose to over $60. Despite missing out on the big payout, the Toughs could not escape the prospecting bug. All four brothers continued working on various projects, bringing their children into the business. Moreover, none of them were murdered. CIM

Photo courtesy of Suncor

featured mines

Firebag in situ operation at sunset

Full steam ahead by | Dan Zlotnikov

Suncor is utilizing innovative technology and recruitment efforts at its Firebag in situ project — part of the company’s $20.6 billion Voyageur expansion.

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Having first entered the game over 40 years ago, Suncor is certainly no newcomer to the oil sands. Over the years, the company has grown through the surges and dips of the oil market. Today, it is well positioned to reap the benefits of the high demand for crude. At an average of 300,000 barrels of bitumen extracted every day, Suncor is the second-largest producer in the oil sands and, thanks to the 35,000 barrels per day (bpd) currently produced at the company’s Firebag project, is also among the largest in situ operators. But Firebag is poised to become an even bigger development, with planning and construction underway on four additional stages.

Centre stage According to Suncor’s vice president of in situ operations Mike MacSween, Firebag, which is part of Suncor’s $20.6 billion Voyageur expansion, is to be brought online in stages.

Firebag stages one and two and a further expansion are currently operational, and the newest, Stage 3, is under construction, with 30 per cent of the work completed so far. In total, $9 billion is earmarked for the Firebag stages 3 to 6, but the returns seem well worth it, with each stage expected to produce 65,500 barrels of bitumen per day. After debottlenecking is complete, it is anticipated that the full six-stage Firebag complex will produce 370,000 barrels of bitumen per day.

The Voyageur upgrader, Suncor’s third such facility, was approved as part of the expansion and will be constructed just west of Suncor’s base plant. Together, Firebag and Voyageur are expected to produce over 200,000 barrels of crude oil per day, 85 per cent of which will be the much-sought sweet crude and diesel.

“The main site for Stage 3 has been cleared and is 1.75 by 0.75 kilometres,” said MacSween. “I was driving to the site today and passed some large modules that were on their way September/October 2008 | 83

“We are remote so we want to create a community — a feeling of home.”

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~ M. MacSween

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Firebag SAGD well pad

here. The undergrounds are complete and we’re busy erecting vessels on the surface.”

Stage 3 is slated to begin producing its first steam towards the end of 2009. Following the steam-in treatment of the wells — a process that takes approximately three months — it will produce its first oil early in 2010. The remaining three stages will begin producing bitumen at staggered intervals, leading up to the full production target of 260,000 barrels per day in the final quarter of 2011. The new upgrader is to follow a matching schedule, slated to come online near the end of 2011.

Waste not, want not An expansion of this size is an exercise in management, not only of the engineering work and supply chain logistics, but also of the complex process of permitting. Suncor is very well aware of the issue; an in situ operation is inherently more energy-intensive than an open pit one. In 2007, when Firebag’s sulphur emissions exceeded the permitted levels, the project’s output was restricted by Alberta regulators to 42,000 barrrels per day — less than half of the potential output of 90,000. But recently introduced waste treatment improvements have lowered the emissions to such a degree that the province removed the cap in July this year.

MacSween does not expect the cap to be an issue even as the new stages come online.

The facility will rely on a set of five gas-powered co-generation units, each producing approximately 85 megawatts of electricity and one of which is currently operating. These are used to power the facilities and generate steam for the in situ process, and to export power to Suncor’s base plant. But the natural gas used to power the generators must be purchased, and it does not come cheaply.

On facing page: 1. Sundog over neighbor drill rig 2. Firebag safety complex 3. Firebag Village recreational centre 4. Firebag Village fitness centre 5. Aerial view of Firebag site 6. Treater vessel.

All photos courtesy of Suncor Energy Inc.

On the flip side, the in situ process results in what is known as “produced vapour,” a combination of water vapour and methane gas. The vapour is cooled to condense the water out and the methane is routed to 80-megawatt, mixed-fuel cogeneration units and other steam generators. In all, MacSween estimated that the gas produced (essentially a byproduct of the in situ and upgrading processes) accounts for between 25 and 30 per cent of Firebag’s fuel requirements.

Another byproduct extracted from the vapour is sulphur, in the form of hydrogen sulphide gas. Hydrogen sulphide is recovered in the amine sweetening and sulphur recovery units installed at the Firebag plant site. The recovered elemental sulphur is then sold on the open market and the condensed and purified water is returned into the steam generation process. MacSween estimated that over 90 per cent of Firebag’s steam generation needs are met through water recycling.

Unique challenges While Suncor has to face the shortage of labour, like other Canadian mining firms, their specific challenges are somewhat unique. “Our business sector is relatively young,” said MacSween. “The in situ organization started at Suncor in this decade. We’ve hired a tremendous number of new people and have a relatively young workforce in our industry segment.”

MacSween explained that in situ extraction is a much newer method than the traditional open pit approach. To meet its labour needs, Suncor has had to be innovative in its recruitment efforts. “We’ve taken a more proactive approach to recruitment with some of the trade schools and universities,” he explained. This meant creating co-op positions and establishing partnerships with institutions such as the Northern Alberta Institute of Technology (NAIT) and Keyano College in Fort McMurray.

In another move to attract workers, Suncor is constructing “Firebag Village” — a permanent camp designed to house 1,500 people. The goal of the camp is to make people feel more comfortable given the fly-in nature of the project. “We are remote,” explained MacSween, “so we want to create a community — a feeling of home.”

Once a new employee is hired, in some cases it can take years for them to become fully qualified for some of the positions, MacSween explained. This is why training and development are such a major focus for Suncor and why the company goes to such lengths to make sure the right person is hired in the first place.

As the expansion process continues, Firebag remains key to Suncor’s goal of a production level of 550,000 barrels per day in 2012. With lots of work, a little bit of luck and an infusion of ingenuity, Firebag is hoping to continue to supply the region’s oil for years to come. CIM September/October 2008 | 85

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Photo courtesy of Western Canadian Coal Corporation

featured mines

A coal pile at Wolverine waits to be loaded on a train.

Feeding a fierce demand by | Dan Zlotnikov

Wolverine n. (1) The largest land-dwelling species of the Mustelidae family.

Like most mustelids, the wolverine is remarkably strong for its size.

(2) A metallurgical coal mining project in northeastern BC, currently in the process of expansion. Quite likely, home to a number of wolverines of the first variety.

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While a discussion of the first definition of a wolverine is best left to zoologists and nature hobbyists, the latter is more likely to capture the attention of mining professionals. Having produced approximately 1.7 million tonnes of export coal in 2007, Wolverine has the two million tonne mark as its goal in 2008 and is aiming for three million by the end of 2010.

Wolverine is owned and operated by Western Canadian Coal Corporation and is the largest and newest of the three

mines the company operates. It accounted for just over half of Western’s volume in 2007. It is also the company’s only operation that produces hard coking coal; the Brule and the Dillon properties produce what is known as PCI, or pulverized coal for injection.

Although the high price for coal — currently at $305 per tonne — was the main driving force behind the expansion, there are indications that it was always in the company’s plans. The processing plant that handles all of Wolverine’s September/October 2008 | 87

featured mines production is capable of processing as much as 770 tonnes of raw coal feed per hour.

More in, more out To reach the three million tonne goal, Wolverine general manager, Bob Bays said Western is developing the EB open pit property, about 17 kilometres from the current mine. The EB pit offers a reserve of eight million tonnes and is expected to begin production in 2010. The plan is to operate EB in parallel with Wolverine until the former’s reserve is exhausted,

tion strategy farther ahead,” said Bays. “Sometimes that means having to go with one supplier over another due to availability.”

The latest additions have been five 150-tonne trucks and a Komatsu PC4000 hydraulic front shovel acquired in November 2007, followed by another three trucks, a Cat® 992G loader and a Sandvik D90K blasthole drill in April and May of this year. With the new equipment in place, Wolverine is moving over 65,000 bank cubic metres (BCM) of rock every day and, according to Bays, is looking to increase that number to just over 70,000 in the near future.

“We’re competing with the diamond mines, the oil sands and other coal companies, so we have to plan our acquisition strategy farther ahead.” around 2018. By that time, other properties will have come online and made up for the supply gap.

Part of the planned production increase has involved augmenting the company fleet. Wolverine operates a mix of Caterpillar and Komatsu machines, which allows for some supply chain flexibility. This has been especially helpful in light of the longer lead times for equipment all mining companies face today.

“We’re competing with the diamond mines, the oil sands and other coal companies, so we have to plan our acquisiAerial view of Wolverine project

Going underground

Developing other properties in addition to EB is another possibility which, according to Bays, is being re-evaluated due to the new market realities. “There is a — B. Bays property adjacent to the existing mine that was originally evaluated for possible development as an underground mine,” Bays explained. “The ratio involved made it uneconomical to develop as a surface mine.” The ratio is the number of BCMs the operator must remove in order to extract one metric tonne of coal.

“Suppose each BCM costs you $6 to remove,” explained Bays.

“That means you’re adding $6 to your operating costs for each ratio point.”

But what might have been dismissed as too costly last year, when met coal prices were under $100 per tonne, is a possibility in the much more lucrative $300+ market. “We

featured mines have to decide on whether we want to go with the potentially cheaper underground approach and possibly miss some of the reserve, or go with the open pit approach, pay more to get the coal out, but get more of it,” explained Bays. One way or another, Bays expects a decision to be made before the end of this year to allow for permitting time — a process which itself can take up to a year despite the deposit lying within the existing lease boundary.

A question of expertise

mented that a relationship of the type Western has with Ledcor is a good way for a smaller company to develop a property.

“We brought Ledcor in when Western was still a young company and engaged them to provide equipment, personnel, systems, everything,” he said.

Hiring and retaining Bays said the biggest challenge the expansion faces is hiring and retaining qualified personnel. While the company has to cope with competition from other mines in the region – most

Another factor affecting the underground versus open pit question is the availability of expertise as, to date, Western has primarily concentrated on surface operations. “We don’t have a team whose focus is underground mining,” said Bays, “so we must determine if we’re going to create one and operate this as a captive mine, or contract out the extraction.”

Western already has an established relationship with a contractor, Ledcor CMI, Ltd., which handles the mining side of Wolverine operations, while Western staff runs the processing plant. Bays explained that while it would have been possible for Western to operate Wolverine as a captive mine, contracting the extraction out to Ledcor allowed for a more efficient capitalization of assets and more rapid startup. Bays com-

September/October 2008 | 89

featured mines

ing, and train them to address the skill gaps between the two fields. Like many other mining firms, the company is quite willing to hire and train people with little or no experience at all, as long as they have a good work ethic.

Expanding markets

Planned production increase involved augmenting the company fleet.

notably the oil sands operations – the problem, as he sees it, is more global in nature. Bays, who has worked in coal mining for almost 35 years, points to the long period of low coal prices and the consequent drop in new hires. “What we have now are a lot of senior people in their 50s and 60s who are ready to retire,” Bays explained.“And then there are very few people until you get to the 20 to 30 age group.”The company must also face the challenge of finding the 80 or so workers needed to run the expanded operation at the mine and processing plant.

One boon has been the downturn in the BC forestry industry. Western, which has an extensive training program, has been able to hire workers transitioning from forestry into min-

90 | CIM Magazine | Vol. 3, No. 6

Bays said that the problem with selling Wolverine’s production at first was rooted in the way two other mines – Quintette and Bullmoose – marketed their product. These operations were involved in a long-term, exclusive arrangement with Japanese steel manufacturers. When the Japanese economy took a downturn in the 1990s, the steelmakers went with it, and both the mines were forced to cease operations as a result. According to Bays, Western CEO John Hogg wanted to keep the company from being so closely linked to the fortunes of a specific company or region, and chose to pursue a diverse list of clients. But because of the exclusivity agreement, the steelmakers of the world were unfamiliar with Wolverine’s coal, although it was mined from the same formation. Once introduced to the product, Bays said they have been very welcoming and Western has established a number of successful long-term relationships with clients in China, South Korea, Europe and the recovering Japanese steel industry. CIM

Photo courtesy of Shell Canada Limited

featured mines

Albian Sands Expansion 1 construction site

Answering a towering need by | Michelle Sabourin

The Athabasca Oil Sands Project Expansion 1 (AOSP Expansion 1) is among the largest oil and gas construction projects currently underway in North America.

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When completed around 2010, the AOSP Expansion 1 will assist Shell Canada Ltd. and its joint venture partners, Marathon Oil Sands L.P. and Chevron Canada Limited, help meet the world’s rapidly growing energy needs. It will increase the bitumen capacity of the Albian Sands mining operations and the Shell Scotford Upgrader by 100,000 barrels per day (Shell’s share: 60,000 barrels per day).

The planned expansion includes the construction of Jackpine mine — located on Shell’s lease 13, east of the exist-

ing Muskeg River mine — and the expansion of the froth treatment facilities. As well, Shell is constructing a new upgrader 450 kilometres north of this new mine, beside its existing upgrader and refinery.

Bitumen from the Albian Sands Expansion 1 (future Jackpine mine) will be diluted and transported to the Scotford Upgrader Expansion 1 via the Corridor Pipeline, which is owned and operated by Inter Pipeline Fund.

September\October 2008 | 91

featured mines A strong foundation A construction project of this magnitude requires a massive workforce — no easy mandate given Alberta’s now notorious labour shortage. To recruit and retain the sheer number of workers needed to build the mining and extraction facilities as well as the infrastructure, such as power lines, roads and pipelines, Shell and its engineering procurement construction management companies, Bechtel and AMEC/Colt, offer attractive compensation packages.

“We knew that if we hoped to be successful in hiring the number of skilled workers required, we needed to offer attractive compensation and an infrastructure that helped them feel at home,” said Paul Hagel, senior communications representative for the oils sands project at Shell Canada. “We delivered on both counts, offering great pay with a world-class work camp that resembles a hotel more than a camp,” Completed in July 2007, the “Albian Village” serves as the primary accommodation for the skilled workers building the future Jackpine mine. This 2,500-person work camp features individual dormitory rooms for employees, a full games room with a dozen pool tables and dart boards, as well as an onsite pub. It also has an indoor running track, skating and hockey rink, racquet ball and squash courts, and a full weight-training facility and gymnasium with his and her saunas.

“We even have recreational coordinators onsite who organize all of the activities for workers after hours,” declared Hagel. “They arrange everything from yoga classes to hockey, soccer and basketball games. It’s just a first-class facility that helps the men and women building this project feel at home while they are away from their families.”

Shell also built a new airstrip to get workers to and from the construction site more quickly and safely. The Albian Aerodrome Airstrip, located one kilometre from Jackpine mine, is among the largest private airstrips in Canada and can accommodate the Airbus A320 family and smaller aircraft such as the Boeing 737.

“Completed at the end of October 2007, this airstrip, together with Albian Village, helps us attract and retain skilled workers, positioning us as the project of choice for workers across Canada and beyond,” said Hagel.

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Teamwork is the hallmark of Albian Sands Expansion 1. Workers assist each other in a cement pour for a future utility building.

Construction site, Albian Sands Expansion 1.

featured mines Shell believes another solution to the skilled labour shortage in Alberta is through apprenticeship development.

“By opening our expansion sites for training and development opportunities, we are helping to ensure our company and the industry at large has access to qualified skilled labour for decades to come,” said Hagel.

Shell Canada has also invested heavily in skilled trades training programs in institutions such as the Northern Alberta Institute of Technology, Southern Alberta Institute of Technology and other Canadian colleges and universities.

They also took advantage of existing registered apprenticeship programs offered at some Albertan high schools that allow full-time students to begin their training in a trade as early as Grade 10, while simultaneously earning credits toward a high school diploma.

“Our corporate objectives are to employ a minimum of 20 per cent apprentices on the AOSP Expansion 1 and so far we’re delivering,” said Hagel.

“This means approximately 1,200 to1,500 apprenticed workers may be involved in the construction process at both sites during peak construction.”

Bonnie McCluskey, CX Rep, Albian Sands Expansion 1, ensures 36-inch pipe is clean and covered before it's utilized in the construction project.

The primary separation cell.

Building partnerships Over 6,000 workers are currently helping to construct AOSP Expansion 1 — approximately 3,000 at the Albian Sands Expansion 1 and 3,000 at the Scotford Upgrader Expansion 1. To help manage both the construction sites and the vast roster of employees, Shell Canada has hired two EPCM companies. Bechtel Canada oversees the Scotford Upgrader Expansion 1 and AMEC/Colt looks after Albian Sands Expansion 1 — the future site of the Jackpine mine. Hundreds of other contracting companies, suppliers and vendors are working alongside the EPCMs to complete the project.

Albian Village, the primary accomodation for the skilled craft labour constructing the Jackpine mine.

The crusher and conveyor located at the future site of Jackpine mine.

September\October 2008 | 93

featured mines ESS/Dene West has partnered with Shell Canada Ltd. to manage and run Albian Village, from hotel administration to catering, which includes feeding over 2,500 men and women twice daily. “ESS/Dene West has really delivered for us in their professional management and care of this world-class facility,” said Hagel. “Their staff are hardworking and know how to resolve the issues that arise from having so many people living together in close Megadoor:Layout 1 8/14/08 9:26 PM Page 1 quarters.”

Construction challenges

Winters at the Jackpine mine site can be very harsh and problematic. “The construction schedule sometimes doesn’t work hand-in-hand with the weather we’re dealt here in northern Alberta,” acknowledged Hagel. Temperatures can dip as low as minus 40 degrees Celsius and, depending on the wind chill, can feel as cold as minus 50. In that frigid air, the company is concerned about the safety of its workforce, especially during the early stages of construction when many of the buildings are still incomplete and the lion’s share of the work occurs outdoors.

These cold temperatures can result in delays in the construction schedule.

“Fortunately, we’ve had a great summer here in Alberta,” remarked Hagel. “It has helped us get the construction schedule Coal and oil sands operations = big trucks back to where it needed to be.”

Typically, when it comes to environBig trucks = big doors mental efforts, Hagel said that Shell Big doors = Megadoor Canada Ltd. and its joint venture partners voluntarily strive to go beyond regulaMEGADOOR = proven reliability for consistent tory requirements. For example, as part operation under extreme conditions of the AOSP Expansion 1, they will install sulphur recovery systems that will enable them to reduce sulphur dioxide emissions from the site by at least 10 per cent. At the Muskeg River mine site they will include a high-temperature froth treatment system that will reduce energy consumption by 10 per cent and will prevent 40,000 tonnes of greenhouse gas emissions a year. “We realize the footprints of these large oil sands developments are significant,” said Hagel. “But through close consideration of economic development, social accountability and environmental responsibility, we try our best to mitigate the overall impacts.”

Currently, AOSP Expansion 1 is well underway to its anticipated startup around 2010. Thanks to creative human resources strategies, strong partnerships and a healthy respect for Mother Nature, work at the mine site is progressing apace. Successful compleCall us today to see how well we fit into tion of the new Jackpine mine and your Coal and Oil Sands operations.

Scotford Upgrader will be important building blocks in this significant expansion being undertaken by Shell 1-888-456-1307 • www.glenridge.ca • info@glenridge.ca Canada Ltd. and its joint venture partners. CIM

BIG TRUCKS NEED BIG DOORS

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mines en vedette

Site Firebag au coucher du soleil

À pleine vapeur

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Suncor n’est pas le dernier venu des sables bitumineux. Au cours des années, la compagnie a encaissé les hauts et les bas des marchés pétroliers. Avec ses 300 000 barils de bitume extraits chaque jour, Suncor est le deuxième plus grand exploitant de sables bitumineux et, grâce aux 35 000 barils produits par jour (b/j) au site Firebag, la compagnie est aussi le plus gros exploitant in situ.

Selon Mike MacSween, vice-président des activités de récupération in situ, Firebag commencera à produire par étapes. Les étapes Firebag 1 et 2 sont opérationnelles et l’étape 3 est complétée à 30 % environ. Au total, neuf milliards de dollars sont prévus pour les stages 3 à 6. Le jeu en vaut la chandelle puisque le complexe Firebag produira 370 000 barils de bitume par jour.

L’installation de valorisation Voyageur, la troisième pour Suncor, sera construite tout juste à l’ouest de l’usine de base.

Firebag et Voyageur produiront ensemble plus de 200 000 b/j de pétrole brut, dont 85 % sera transformé en pétrole brut non corrosif et en diesel.

L’étape 3 devrait commencer à produire de la vapeur vers la fin de 2009. Après le traitement des puits avec de vapeur – un processus qui prend habituellement trois mois – la production de pétrole pourra débuter en 2010.

Un agrandissement de cette taille demande de gérer non seulement les travaux d’ingénierie et de logistique mais aussi le processus complexe de demande de permis. Une installation in situ demande plus d’énergie qu’une exploitation à ciel ouvert. En 2007, alors que les émissions de soufre de Firebag ont dépassé les niveaux permis, les autorités albertaines ont plafonné la production à 42 000 b/j. Les améliorations récentes ont permis de lever cette limite en juillet dernier.

L’installation aura cinq unités de cogénération alimentées au gaz, produisant chacune environ 85 mégawatts d’électri-

cité. Elles alimenteront les installations et généreront de la vapeur pour la récupération in situ.

Le procédé in situ produit de la vapeur et du méthane ; la vapeur est refroidie pour condenser l’eau et le méthane est récupéré. L’eau et le méthane sont réacheminés aux unités de génération de vapeur. Le soufre, sous forme d’hydrogène sulfuré, est un autre sous-produit extrait de la vapeur; il est vendu sur les marchés libres.

M. MacSween estime que plus de 90 % de l’eau nécessaire pour la génération de la vapeur est obtenue par recyclage.

Bien que Suncor ait les mêmes problèmes de pénurie de main-d’œuvre que les autres compagnies minières canadiennes, ses défis sont quelque peu uniques. « Notre secteur est relativement jeune, tout comme nos employés, et l’extraction in situ est une technologie nouvelle », explique M. MacSween. « Nous recrutons de manière proactive, en créant des postes de stages coopératifs.

Nous avons établi des partenariats avec le Northern Alberta Institute of Technology et le Keyano College à Fort McMurray.

Suncor construit aussi le village Firebag, un camp permanent pour 1500 personnes. « Nous sommes dans une région éloignée mais nous voulons créer une communauté, un sentiment d’appartenance. » Comme cela peut prendre des années pour former des travailleurs dans certains postes, Suncor ne veut embaucher que les bonnes personnes au départ.

Firebag demeure la clé pour l’atteinte de l’objectif de Suncor de produire 550 000 b/j en 2012. Avec beaucoup de travail, un peu de chance et de l’ingéniosité, Firebag espère pouvoir continuer à fournir du pétrole pour des années à venir. ICM September\October 2008 | 95

mines en vedette

Vue aerienne du site Wolverine

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Agrandissement de Wolverine

Le terme anglais wolverine (carcajou) intéresse non seulement les zoologistes mais maintenant aussi les professionnels miniers. La mine Wolverine a produit 1,7 million de tonnes de charbon en 2007 et vise 3 millions de tonnes pour la fin de 2010.

La mine est la propriété de Western Canadian Coal et c’est la seule qui produit aussi du charbon cokéfiable dur; les mines Brule et Dillon ne produisent que charbon pulvérisé aux fins d’injection (CPI).

Bob Bays, le directeur général de Wolverine explique que le CPI est vaporisé dans le fond des hauts fourneaux pour augmenter la température et ajouter du carbone au produit final.

Avec un prix de vente de 248 $/tonne, il n’est pas trop loin des 305 $/tonne obtenus pour le charbon métallurgique.

Ces prix justifient l’agrandissement mais la compagnie le prévoyait depuis longtemps, car l’usine de traitement peut recevoir 770 tonnes de charbon brut par heure.

Pour atteindre l’objectif de 3 Mt, Western développe la propriété EB; elle a des réserves de 8 Mt et devrait commencer à produire en 2010.

L’augmentation de la production signifie toutefois plus d’équipements. « Nous sommes en compétition avec les mines de diamants, les sables bitumineux et les autres exploitations de charbon; nous devons donc planifier très longtemps à l’avance et parfois même changer de fournisseur », dit M. Bays.

Les derniers ajouts ont été des camions de 150 tonnes et une pelle Komatsu PC4000, une chargeuse CatMD 992G et une foreuse Sandvik D90K. Avec ces nouveaux équipements, Wolverine vise à déplacer plus de 70 000 mètres cubes de roc en place par jour dans un proche avenir.

Une autre propriété, prévue comme mine souterraine, est réévaluée en mine à ciel ouvert. « Le nombre de mètres cubes 96 | CIM Magazine | Vol. 3, No. 6

de roc en place à retirer pour extraire un mètre cube de charbon est un facteur déterminant », explique M. Bays.

Ce qui était considéré trop cher l’an dernier alors que le prix du charbon métallurgique était inférieur à 100 $/t devient possible avec des prix qui dépassent 300 $/t. « Nous devons donc choisir la méthode d’extraction : souterraine sans tout extraire ou à ciel ouvert et obtenir plus de charbon », poursuit M Bays. La décision doit être prise sous peu pour tenir compte du temps d’obtention des permis — un processus qui peut prendre un an malgré que le gisement soit à l’intérieur des limites du bail actuel.

Western exploite cependant surtout des gisements en surface. « Nous n’avons pas d’experts en mine souterraine ; nous devons déterminer si nous formerons une équipe ou si nous embaucherons un entrepreneur », dit M. Bays. La compagnie fait déjà affaires avec Ledcor CMI Ltd qui effectue les activités minières de Wolverine alors que le personnel de Western exploite l’usine de traitement.

Le plus gros défi demeure la main-d’œuvre. Bien que la compagnie doive faire face à la compétition d’autres secteurs, M. Bays voit aussi le problème d’un autre angle. Avec de longues périodes de faibles prix, il y a eu peu d’embauche. « Nous avons beaucoup d’employés qui ont 50 à 60 ans et très peu dans la tranche démographique entre ce groupe et les jeunes de 20-30 ans », explique-t-il.

Le président et directeur général de Western, John Hogg, ne voulait pas lier la compagnie à un acheteur unique ou une région spécifique. Cependant en raison de contrats antérieurs d’exclusivité avec d’autres mines, les aciéristes ne connaissaient pas le charbon Wolverine. Une fois le produit connu, il a été possible d’établir des relations à long terme avec la Chine, la Corée du Sud, l’Europe et le Japon. ICM

mines en vedette

Site de construction du projet d’expansion Albian Sands 1.

Répondre à un besoin pressant

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Le Projet 1 d’expansion dans les sables bitumineux de l’Athabasca compte parmi les plus gros projets de construction dans l’industrie du gaz et du pétrole en Amérique du Nord. Lorsqu’il sera terminé, le Projet 1 d’expansion dans les sables bitumineux de l’Athabasca aidera Shell Canada et ses partenaires de coentreprise, Marathon Oil Sands L.P. et Chevron Canada, à rencontrer les besoins énergétiques mondiaux croissants. Il augmentera la capacité d’extraction de bitume des exploitations Albian Sands et des installations de valorisation de près de 100 000 barils par jour (b/j); la part de Shell sera de 60 000 b/j.

L’expansion comprend la construction de la mine Jackpine, l’agrandissement des installations de traitement des mousses et une nouvelle installation de valorisation.

Le bitume de la future mine Jackpine sera dilué et transporté à l’installation de valorisation par oléoduc.

Pour recruter et maintenir les très nombreux travailleurs requis pour la construction des infrastructures et des installations d’extraction et de traitement, Shell et ses compagnies d’ingénierie-approvisionnement-construction-gestion, Bechtel et AMEC/Colt, offrent une rémunération très intéressante ainsi que des conditions qui aident les employés à se sentir chez eux. « Nous avons bien livré tout cela, une bonne rémunération et un camp de travail qui a plus les allures d’un hôtel que d’un camp », dit Paul Hagel, représentant principal des communications pour le projet des sables bitumineux chez Shell Canada..

Le « Village Albian » loge 2500 ouvriers spécialisés qui construisent la future mine Jackpine. Il comporte des chambres individuelles pour les employés, des salles de récréation, une piste intérieur, une patinoire, des courts de squash et de racquetball ainsi que des salles d’entraînement et des saunas.

Shell a aussi construit une nouvelle piste d’atterrissage à un kilomètre de la mine Jackpine; elle est parmi les plus

grosses pistes privées au Canada, pouvant accueillir un Airbus A320 et des avions Boeing 737.

Selon Shell, une autre solution à la pénurie de maind’œuvre est le développement de stages d’apprentissage. « En effectuant de la formation à nos sites en expansion, nous nous assurons que notre compagnie et l’industrie en général a la main-d’œuvre qualifiée nécessaire pour les prochaines décennies. Nous avons un objectif de 20 % d’apprentis dans le projet d’expansion des sables bitumineux », dit M. Hagel.

De plus, Shell a beaucoup investi dans des programmes de formation dans de nombreuses institutions en Alberta et à travers le Canada.

Plus de 6000 travailleurs s’affairent à construire le Projet 1 d’expansion dans les sables bitumineux de l’Athabasca, environ 3000 au site d’extraction et 3000 à l’installation de valorisation. Bechtel Canada et AMEC/COLT ainsi que des centaines d’autres entrepreneurs et fournisseurs travaillent à compléter le projet, dont ESS et Dene West qui administrent le logement et la nourriture au Village Albian.

Les hivers au site de la mine Jackpine peuvent être très rudes avec des températures de moins 40ºC. La compagnie se préoccupe beaucoup de la sécurité du personnel, surtout dans les premières étapes de la construction où le travail se fait beaucoup à l’extérieur.

Pour l’environnement, Shell et ses partenaires s’imposent des normes plus sévères que les réglementations en cours.

Par exemple, ils installeront des systèmes de récupération du soufre au site d’expansion et, à la mine Muskeg River, un système de traitement des mousses à haute température pour réduire la consommation d’énergie et réduire les gaz à effet de serre. « Nous réalisons que l’empreinte de ces développements est importante », dit M. Hagel. « Par l’étude attentive du développement économique et notre responsabilisation sociale et environnementale, nous nous efforçons de mitiger les impacts. » ICM September\October 2008 | 97

cim news CIM welcomes new members Alksnis, Daniel, Ontario Arel, Jonathon, Québec Audet, Dany, Québec Audet, Dominic D.A., Québec Ayotte, Maegan, Ontario Baker, Mark, Ontario Beaudet, François, Québec Béland, Thomas T.B., Québec Bélanger, Karine, Québec Bertrand, Etienne E.B., Québec Bérubé, Jean-Pierre, Québec Bhaskar, Karanth, Québec Blackburn, Nathalie, Québec Blais, Ronald J., Ontario Bobicki, Erin, Ontario Bodhmage, Abhay, Saskatchewan Bolturukov, Tengiz, Ontario Brooks, Jane, Ontario Bulled, David, Ontario Burchell, John, Ontario Burke, Christopher, Ontario Buttar, Glustaf, Ontario Cafazzo, Dustin, Ontario Caron-Dionne, Alexis, Québec Carrick, Roger, Ontario Cavasin, Chris, Ontario Champagne, Christine, Ontario Charest, Evelyne, Québec Cheng, Terry, Ontario Cockerham, Van, USA Coffin, Julie, Ontario Colden, Jeffrey, Ontario Coley, Daniel, Ontario Connolly, James, Ontario Critch, Patrick, Newfoundland and Labrador Currie, Caraleigh, Saskatchewan Cyr, Jason, Ontario Dallaire, Nicolas, Québec d’Amours, Julien, Québec Dhanjal, Sanjiv, USA Dubois, François, Québec Dugas, Steven, Ontario Dumas, Caroline, Québec Dumois, Simon, Québec Durocher, François, Québec El Jundi, Zeid, Ontario Ellemers, Pamela, Ontario Emmanuel, Joseph, Ontario Entrialgo, Jesus, Québec Ethier, Graham, British Columbia Fisette, Hugo, Québec Foster, Scott, British Columbia French, Monika, Ontario Fulcher, Sean, Québec Furmanic, Rob, Saskatchewan Gagné, Geneviève, Québec Gagnon, Claude, Québec Gilbert, François, Québec Girard, Mike, Québec Goudreau, Simon, Québec Gouin, Henri, Québec Govette, Ghislain, Québec Gronstrand, Sami, Finland 98 | CIM Magazine | Vol. 3, No. 6

Guimont, Pierre, Québec Heinbigner, Carey L., Saskatchewan Henriksson, Brandt, Ontario Hnatiw, Fred, Alberta Hopkins, Katherine, Ontario Howe, J.P., Ontario Hudon, André, Québec Israel, Reix, Québec Jaber, Wael, Québec Jacob, Claude, Québec Janson, Marc, Québec Jayaraman, Vikram, Ontario Johnson, Alan A., Alberta Jordan, James, Ontario Kendall, James, Ontario Krevi, Pasi, Finland Labonté, Jean-Sébastien, Québec Lacasse, Simon, Québec Landriault, Jacob, Ontario Lapointe, Philippe, Québec LeBlanc, Léon G., Québec Lemay, Guy, Québec Lepage, Jean-Felix, Québec Lippencott, Thomas, USA Loiselle, Yanick, Québec Lozano, Carlos, Ontario Mailloux-Kercack, Gabriel Etienne, Québec Makni, Sami, Québec Maldonado, Miguel, Québec Malovine, Sébastien, Québec Marcotte, Julien, Québec Marcoux, Sonia, Québec Marcoux, Benjamin, Québec Mellies, Gabriele, Québec Middleditch, Dave John, Ontario Morin, Dominique, Québec Morin, Véronique, Québec Murphy, Steven, USA Nasery, Hesam, Québec Nernberg, Brandie, Ontario Nicol, Don, Ontario

Nixon, Alicia, British Columbia Olurin, Olujide, Newfoundland O’Neill, Phil, Ontario Ouedraogo, Didier, Burkina Faso Peters, Brad, British Columbia Plante, Isabelle, Québec Quispe, Rolando R.Q., Québec Restrepo, Linda Lucia, Québec Robertson, Campbell, Québec Root, David, USA Roy, Gillian, British Columbia Sasseville, Yanick, Québec Sauvé, Mel, Ontario Schoengen, Scott, Ontario Simons, Erskine, Québec Snyder, Tom, Ontario St-Jacques, Stéphanie, Québec Sturk, Melanie, Ontario Szo, Steve, Alberta Taleghani, Reza, Ontario Tarkyth, Dène J., British Columbia Taylor, Kerina, Ontario Thivierge, Jean-Philippe, Québec Travis, Todd, Ontario Tremblay, Marc-Alexandre, Québec Tshilumbu, Nsaka, Québec Turriff, Glen, Québec Vachon, Sylvie, Québec Villarroel, Nestor A., Chile Wang, David, Ontario Wang, Xinran, Ontario White, Heather, Ontario Wu, Yaokum (Rocky), Ontario Yeo, Bill, Ontario Zhang, Xin, Québec

Corporate Laforest Nova Aqua LEHDER Environmental Services Seneca Westfalia Separator

A look back in time 20 YEARS AGO… • The Maintenance/Engineering Division of The Institute of Mining and Metallurgy organized the International Conference on Hoisting in Toronto from June 12 to 17, 1988.

• A paper in the technical section on open pit mining included a discussion on the new de rigueur technology of computerized truck dispatch systems which, back then, were a noteworthy innovation.

• The newly established Centre for Chemical Process Metallurgy held its inaugural meeting on May 20, 1988. Seven industry founding members and 30 researchers from five Ontario universities participated.

• A historical piece on metallurgy in the Belgian Empire recounted Stanley’s fabled encounter with Dr. Livingstone near Lake Tanganyika.

The above was taken from the September 1988 issue of CIM Bulletin.

CIM Environmental Society web meetings Fostering sustainability through online learning Conscious of their ecological impact, mining companies regularly exceed regulatory requirements and public expectations on the road to sustainability. Committed to this cause, CIM’s Environmental Society has organized a series of web meetings showcasing the industry’s best efforts. From the convenience of your desk, without burning fossil fuel to travel to a presentation, you can learn about sustainable mining at the click of a mouse.

Upcoming live broadcast web meetings include: Mine Water Management Everything you need to know about dealing with flooding and water management facilities, from definitions of key terms to best water management practices.

Presenter: David E. Bleiker, M.A.Sc., P.Eng., Eastern Canada Mining Sector Leader, AMEC Earth & Environmental Date: September 25, 2008 Time: 2:00 p.m. to 3:00 p.m. EST The Shore Road Soil Study – An Assessment of Soils in the Vicinity of a Lead Smelter Separate caution from alarmism and fact from conjecture about the environmental and public health risks associated with lead smelting.

Presenter: Christine Moore, M.Sc., Senior Scientist, Intrinsik Date: October 16, 2008 Time: 2:00 p.m. to 3:00 p.m. EST Aboriginal Outreach Learn all about successfully, fairly, responsibly and legally engaging First Nations communities in the resources industry.

Presenters: Philip Bousquet, Director – Regulatory Affairs, The Prospectors and Developers Association of Canada, Rick Meyers and Maggie Papoulias, Mining Association of Canada Date: November 13, 2008 Time: 2:00 p.m. to 3:00 p.m. EST

Register at www.cim.org

cim news From guts to glory When he was notified of the dwindled support and activity of the CIM Crowsnest Branch, Chris Ryan felt compelled to accept the job of branch chair and take on the task of revitalizing the organization. In just a few years, Chris and his ambitious executive team were able to take the branch to new heights, turning it into a strong and promising element in the CIM network. They were rewarded for their efforts in 2007 when the Crowsnest Branch was presented with the Mel W. Bartley Award for demonstrating the most progress in reaching the aims of CIM. When he is not blazing new trails in the mountains of the Crowsnest Pass for CIM, Chris can be found focusing on operational goals at the Sparwood offices of Elk Valley Coal.

Chris took a break from his busy schedule to speak with CIM on the delicate intricacies and everyday realities of bringing new life to the branch.

CIM: What led you to mining?

C.R.: A stroke of luck really. While attending a CIM student night at the University of Alberta, Dr. Tim Joseph gave a presentation on some of his experiences in mining. One facet that was particularly interesting was his experiences in drilling and blasting.

That was enough to get me hooked.

CIM: Why did you become a CIM member? C.R.: I saw CIM as an opportunity to interact with professionals in the

by Robbie Pillo industry, leading to a broadened spectrum of knowledge and resources.

CIM: What has winning the Mel Bartley award done for the branch as a whole?

C.R.: It was a sign that we were on the right track with how we were rebuilding the branch. It also gave us a boost of confidence and certainly perked up people’s interest.

100 | CIM Magazine | Vol. 3, No. 6

focused to maintain a high level of visibility with both local industry and communities.

Chris Ryan

CIM: What was involved in the Crowsnest Branch’s revival?

C.R.: The Crowsnest Branch started out with four key members in early 2005 — Dale DeClercq, Michael Lukach, Derek Cooper and myself.

Together, we battled through the initial hurdles of setting up the branch financials, developing technical programs and keeping the buzz alive. Today, we stand with a total of nine members on the committee, along with several volunteers who often assist us with the planning and execution of large events. We try to keep the branch

CIM: Would you say that this is a challenge?

C.R.: Most definitely. After all, it is the longevity of the branch that in part measures our success. We must always be looking for ways to build value for our members, as well as for the communities. Of course, there is the ever-lingering issue with busy schedules. It is a constant effort to coordinate with members of the executive committee to get as many as possible together for meetings or discussions CIM: And the benefits?

C.R.: It really allows one to stay in tune with the pulse of the national office as well as divisional activities.

We have a large number of members who travel throughout British Columbia and Alberta, and we like to keep them in the loop as much as possible regarding events abroad. It also provides the opportunity to meet a wide spectrum of individuals involved with the various aspects of the mining business — from suppliers to contractors to manufacturers. CIM

Obituaries CIM expresses its sincere condolences to the families and friends of the following members:

Desmond F. Horan joined CIM in 1949 and became a life member in 1984. He died on March 4, 2008.

Charles M. Campbell Jr. joined CIM in 1939 and became a life member in 1976.

Peter Potapoff had been a member of CIM since 1951 and a life member since 1989.

Kenneth G. Davies was a member of CIM since 1944 and a life member since 1989.

Dexter C. Hatch joined CIM in 1969 and became a life member in 1996.

Alan F. Raney became a member of CIM in 1941 and achieved life member status in 1980. He died on July 17, 2007.

cim news Rendezvous by the lake The Mining Society of Nova Scotia’s 121st Annual General Meeting The Mining Society received the award. of Nova Scotia held its Centennial Scholarship 121st annual general Medals were awarded to meeting from June 12 the university students to 13, 2008 at the Julia King, Adam Inverary Resort on the Ostridge and Kara-Lynn shores of the beautiful Scallion. John Campbell Bras d’Or lakes in Cape won the Mining Society Breton, Nova Scotia.

Medal and Sam Schwartz The theme for the received the President’s meeting was “Atlantic Citation. Other honCanada’s Resources – ourees included William Supporting a SustaMundle and James inable Future,” which Randall. Ross McCurdy, was the focus of a president of the Cape series of presentations Breton Development directed by Bob Corporation, enlightened MacDonald, the techthe gathering on the nical chairman of the Devco Legacy Program. event.

The next day’s technical Prominent speakers program, chaired in parts at the AGM included

by Gordon Dickie and the Honourable David Bob MacDonald, was Morse, Minister of organized under two Natural Resources of themes: “New Operations: the Government of Creating Wealth in Nova Scotia, and CIM Atlantic Canada” and executive director Jean “Engaging the Stakeholders Vavrek. The meeting and Regulators.” Under the was chaired by Dan first theme, overviews of MacDonald, president six significant new projects of the MSNS. After the and developments were Council was appointed presented. The second for the year 2008theme included three sepa2009, secretary-treasrate presentations on the urer George Sigut pre- Top: Outgoing president Dan MacDonald pins President’s Medal on in-coming president challenges of communicaDickie. sented the Annual Gordon tion and community Bottom: President Gordon Dickie pins the Past President’s Medal on Dan MacDonald.

Financial Report and engagement that the indusJohn Amirault try often faces. Closing the reported on the Fletcher Fairbault and ecology of Nova Scotia’s technical presentation, a panel discusMemorial Fund. Before the technical resources industry. Presentation sion that included the Honourable presentations began, a minute’s abstracts were compiled in a booklet David Morse was chaired by David silence was observed in honour of that was given to all participants Forrester. the late Kevin Beaton, a dedicated upon registration.

Closing the event, outgoing presmember who had passed away durThe highlight of the AGM was ident Dan MacDonald pinned the ing the year. the presentation ceremony, conPresident’s Medal on the lapel of his The first day’s technical program ducted at a banquet that evening. successor, Gordon Dickie. The featured five presentations that pro- The CIM Fellowship Award was annual general meeting concluded vided insights into the latest develop- conferred posthumously on Kevin with a final speech and vote of ments in the engineering, economics Beaton, whose wife, Jayne Beaton thanks by Dan MacDonald. CIM September/October 2008 | 101

How to keep abreast of the best The Distinguished Lecturer Program enables CIM societies and local branches to host presentations by peer-nominated industry experts from the minerals industry. Keep abreast of the latest developments and innovations.

Let people know Spread the word. Publicity boosts awareness, membership and sponsorship.

• Submit articles to newsletters and CIM Magazine • Post your event on CIM’s and other websites • Post flyers at work and local mining schools • Contact local media • Involve mining school students

Act now Book your CIM Distinguished Lecturer today. With seven presentations already booked, the 2008-2009 season dates are going fast.

Tenez-vous au courant des nouveautés Le programme des Éminents conférencier fournit aux sociétés et aux sections locales de l’ICM la possibilité de présenter des conférences par des experts reconnus de l’industrie minérale. Tenez-vous au courant des derniers développements et innovations.

Informez la communauté Diffusez la nouvelle. La publicité peut aider à accroître la sensibilisation, vous attirer de nouveaux membres et des commandites.

• Soumettez un article dans les bulletins d’information et au CIM Magazine.

• Affichez votre activité sur le site Web de l’ICM ou sur tout autre site.

• Affichez des avis sur les babillards de travail ou facultés locales de génie minier.

• Contacter les médias locaux • Impliquez les étudiants en génie minier

Agissez dès maintenant Réservez votre conférencier émérite dès maintenant. Avec sept présentations déjà réservées, les dates de disponibilité pour la saison 2008-2009 s’envolent rapidement.

Contact / Contactez :

1.

Select a lecturer Choisissez un conférencier

2.

Act early to ensure availability Réservez-le sans tarder afin d’assurer sa disponibilité.

3.

Complete the online request form. CIM will coordinate travel details with the local branch Complétez le formulaire de demande en ligne.

L’ICM coordonnera les détails de voyage avec la section locale

First annual meeting a huge success

From left: Jim Popowich with NCBC Branch executives Joe Hines, Jamie Hull, Ben Radke, Greg Rasmussen, Jennifer Parry, Robert Piccolo and Paul Kennedy.

The CIM North Central BC Branch hosted their first annual general meeting in over five years, from June 25 to 27, in Prince George. After its revival in November 2007, this event marks the branch’s official comeback.

The event offered technical presentations that tackled timely and pressing issues in the area. The two-day technical program began with a series of presentations focused on knowledge sharing between departments of various operations.

CIM Past President Jim Popowich and Chief Dominic Frederic of the Lheidli T’enneh First Nations Band kicked off the second day of presentations. Chaired by Ed Beswick, past vice president of District 6 and Hard Creek Nickel director, the panel featured some of the most prominent industry leaders in the area: Gord Sebastian, executive director of the Gitxzan First Nations, Bruce Sutherland, chairman of the Northern Trust, and Mayor Jack Tulstra of Terrace, BC. This dynamic group prompted discussions around First Nations in mining and the existing and future projects in British Columbia, such as the Highway 37 Corridor.

Conference participants were entertained by a variety of activities. City of Prince George councillor Sherry Sethen welcomed delegates at the Wine and Cheese Reception held on June 25.

by Robbie Pillo The following evening, during the silent auction and dinner, guests placed bids on a variety of items, such as golf clubs, hotel suites and spa packages, while reflecting on the words of Pierre Gratton, president and CEO of the Mining Association of BC, and City of Prince George Mayor Colin Kingsley.

The three-day conference concluded on a high note with the annual golf tournament held at the Aberdeen Glen Golf Course, which was a successful fundraising event. All the proceeds from the golf tournament and dinner auction will go to the Northern BC Friends of Children Society. CIM

CIM Conference and Exhibition Toronto, Ontario May 10–13, 2009

Preliminary Technical Program Sharing Knowledge to Improve Efficiency TIME Management of People Mon PM Tues AM1 Tues AM2 Tues PM Wed AM1 Wed AM2

SESSION

Health and Safety Human Resources: Attraction Human Resources: Retention Community Outreach in Canada and on the International Frontier Diversity Forum Diversity Forum continuation

Mine Cycle Management Mon PM Tues AM1/2 Tues PM Wed AM1/2

Risk Management and Valuation Standards Mine Construction/Development Mine Operation Managing for Closure

Projects Mon PM Tues AM1 Tues AM2 Tues PM Wed AM1 Wed AM2

Ontario Soft Rock Oil Sands Arctic Remote Projects International Projects

Innovation and Technology Mon PM Tues AM1 Tues AM2 Tues PM Wed AM1 Wed AM2

Challenges Driving Innovation Emerging Technologies and Best Practices Solutions to Energy and Fuel Challenges SMART-led Session on R&D New Technology and Processes 1 New Technology and Processes 2

Earth Sciences Mon PM Tues AM1 Tues AM2 Tues PM Wed AM1 Wed AM2

Climate Change Water Management Land and Air Stewardship Beyond Reclamation Geology Geology

Call for Papers 20th Canadian Rock Mechanics Symposium Rock Engineering in Difficult Conditions Parallel program with CIM Conference and Exhibition Toronto – May 9 to 14, 2009 Abstract submission deadline is October 15, 2008. www.rockeng09.com

Last call for papers Submit your abstract online before September 30.

www.cim.org/toronto2009

CIM EVENTS Cobalt Branch Seafood Night September 25 Haileybury, Ontario Contact: Todd Steis Email: todd.steis@mti.ca Conférence technique de la section Thetford Mines 1er octobre Thetford Mines, Québec Contact: Pierre Laroche Tel.: 418.338.7500 Email: lab.plar.cq@bellnet.ca Winnipeg Branch Lunch Guest speaker (TBA) October 16 Winnipeg, Manitoba Contact: Mark Francis Email:sfrancis@mts.net Symposium 2008 sur l’environnement et les mines/ Symposium 2008 on Mines and the Environment 2 au 5 novembre Rouyn-Noranda, Québec Contact: Chantal Murphy, CIM Meetings Coordinator Tel.: 514.939.2710, ext. 1309 Email: cmurphy@cim.org Website: www.cim.org 41st Annual Canadian Mineral Processors Operators’ Conference January 20-22 Ottawa, Ontario Contact: Janice Zinck Tel.: 613.995.4221 Email: jzinck@nrcan.gc.ca Website: www.c-m-p.on.ca Tournoi de Curling et Assemblée générale annuelle de la section de Thetford Mines 30 au 31 octobre Thetford Mines, Québec Contact : Pierre Laroche Tel. : 418.338.7500 Email : lab.plar.cq@bellnet.ca World Gold April 14-19 Cape Town, South Africa Contact: Paul van der Plas Email: vanderplas@cput.ac.za Website: www.worldgold2009.org.za/

AROUND THE WORLD Mining World Uzbekistan October 2-4 Tashkent, Uzbekistan Contact : Anna Aleinikova Tel.: +44.207.596.5186 Email: anna.aleinikova@ite-exhibitions.com Website: www.miningworld-uzbekistan.com Aboriginal Law Emerging Issues and Risk Assessment in Project Development October 2-7 Vancouver, British Columbia Toronto, Ontario Contact: Joseph Sanzo Tel.: 416.298.5141, ext. 2665 Email: register@lexpert.ca Website: www.lexpert.ca/events/eventdetails.aspx?eid=38 Paste and Thickened Tailings October 6-8 Golden, Colorado, USA Contact: Robert Cooke Tel.: 303.273.3321 Email: robert@PatersonCooke.com Website: www.PatersonCooke.com 4th Annual Infrastructure Partnerships for African Development (IPAD) October 7-9 Kinshasa, DRC Contact: Nicole Smith Email: nicole.smith@spintelligent.com Website: www.ipad-africa.com/central MENA Mining Congress 2008 October 13-16 Dubai, UAE Contact: Emma Roborgh Tel.: +971.4.709.4500 Email: emma.roborgh@terrapinn.com Website: www.terrapinn.com/2008/miningme V International Mineral Processing Seminar (PROCEMIN 2008) October 22-24 Santiago, Chile Contact: Fabiola Bustamante Tel.: +56.2.652.1555 Email: info@procemin.cl Website: www.procemin.cl

September/October 2008 | 105

Hôtel Gouverneur Noranda, Rouyn-Noranda, Québec du 2 au 5 novembre 2008 | November 2 to 5, 2008

Programme préliminaire

|

Preliminary program

L’Université du Québec en Abitibi-Témiscamingue (UQAT) et l’Institut canadien des mines, de la métallurgie et du pétrole (ICM) vous invitent à Rouyn-Noranda, Québec, Canada, du 2 au 5 novembre 2008, à l’occasion du Symposium 2008 sur l’environnement et les mines.

The University of Quebec in Abitibi-Témiscamingue (UQAT) and the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) invite you to Rouyn-Noranda, Quebec, Canada, to attend the Symposium 2008 on Mines and the Environment, from November 2 to 5, 2008.

Le symposium est le résultat d’une collaboration entre la Chaire CRSNG Polytechnique-UQAT en environnement et gestion des rejets miniers, l’Unité de recherche et de service en technologie minérale (URSTM), l’Association minière du Québec (AMQ), le Programme de neutralisation des eaux de drainage dans l’environnement minier (NEDEM), le ministère des Ressources naturelles et de la Faune du Québec (MRNF) et l’industrie.

This symposium is the result of collaboration between the Industrial NSERC Polytechnique-UQAT in Environment and Mine Wastes Management, the Unité de recherche et de service en technologie minérale (URSTM), the Mining Association of Quebec (AMQ), the Mine Environment Neutral Drainage (MEND) Program, the Minister of Natural Resources and Wildlife of Quebec (MRNF) and industry.

Les objectifs du Symposium visent à partager les connaissances les plus récentes et à discuter des expériences pratiques afin de « trouver des solutions pour concilier rentabilité et protection de l’environnement ».

The objectives of the symposium are to share recent knowledge and research developments and to discuss common practices to find solutions that reconcile profitability and environmental protection.

Programme technique | Technical program

Lundi | Monday AM 8h15 — Rejets de concentrateur | Tailings Considérations hydrogéochimiques reliées à la disposition des résidus épaissis, incluant les résidus en pâte | Hydrogeochemical considerations related to disposal of thickened tailings, including paste R. Verburg, V. Bertrand, Golder Associates Ltd.

Les effets d’amendements alcalins sur des résidus miniers sulfureux entreposés en surface: cas des dépôts en pâte | Effects of alkaline enrichment on sulphidic tailings disposed in surface facilities: case of paste deposition M. Benzaazoua, T. Deschamps, H. Bouzahzah, B. Bussière, Université du Québec en Abitibi-Témiscamingue, V. Martin, M. Aubertin, École Polytechnique de Montréal

Évaluation d’un mélange de résidus en pâte et de roches stériles (paste rock) pour une gestion améliorée des rejets miniers | Evaluation of paste rock for improved mine waste management G.W. Wilson, NBK Institute of Mining Engineering, University of British Columbia, B. Wickland, Golder Associates Ltd., J. Miskolczi, SRK Consulting

Évaluation de l’applicabilité d’une gestion intégrée des rejets de concentrateur à la mine Doyon | Evaluation of the applicability of integrated tailings management for Doyon mine I. Demers, M. Benzaazoua, B. Bussière, M. Mbonimpa, É. Fried, Université du Québec en Abitibi-Témiscamingue, M. Aubertin, École Polytechnique de Montréal, A. Blier, IAMGOLD, Mine Doyon

10h15 — Remblayage souterrain | Backfill Compréhension du processus de déposition des remblais en pâte cimentés | Understanding the cemented paste backfill deposition process A. Fourie, M. Fahey, University of Western Australia, M. Helinski, Australian Centre for Geomechanics

Rétro-analyse de la performance d’une barricade sous un chantier avec du remblai en pâte | Back-analysis of barricade performance for a paste filled stope M. Grabinsky, W.F. Bawden, B. Thompson, University of Toronto

Évaluation des pressions dans les chantiers remblayés et sur les barricades | Evaluation of pressures in backfilled stopes and barricades M. Aubertin, L. Li , École Polytechnique de Montréal, T. Belem, Université du Québec en Abitibi-Témiscamingue, R. Simon, École Polytechnique de Montréal

La résistivité électrique et la sismique appliquées à l’étude des comportements mécaniques, géotechniques et environnementaux des remblais cimentés en pâte | Electrical resistivity and the seismic techniques used to investigate the mechanical, geotechnical and environmental behaviour of cemented paste backfill S. Ouellet, Genivar, M. Chouteau, École Polytechnique de Montréal

Lundi | Monday PM 13h15 — Roches stériles | Waste Rocks Le programme de recherche sur les roches stériles à la mine Diavik | The Diavik waste rock research program D. Blowes, Department of Earth and Environmental Sciences, University of Waterloo, L. Smith, Department of Earth and Ocean Sciences, University of British Columbia, D. Sego, Department of Civil and Environmental Engineering, University of Alberta, M. Moore, Department of Earth and Environmental Sciences, University of Waterloo, M. Neuner, M. Gupton, Department of Earth and Ocean Sciences, University of British Columbia

Caractérisation du comportement hydrogéologique et géochimique des haldes à roches stériles | Characterization of the hydrogeological and geochemical behaviour of waste rock piles M. Aubertin, O. Fala, J. Molson, M. Chouteau, M.A. Hernandez, O. Anterrieu, R. Chapuis, École Polytechnique de Montréal, B. Bussière, Université du Québec en Abitibi-Témiscamingue

Évaluation du comportement environnemental des stériles miniers de la mine Tio, Havre-St-Pierre, Québec | Evaluation of the environmental behaviour of waste rocks at the Tio mine, Havre-St-Pierre, Québec B. Bussière, B. Plante, G. Pépin, Chaire industrielle CRSNG PolytechniqueUQAT en environnement et gestion des rejets miniers, UQAT, M. Aubertin, G. Zagury, Chaire industrielle CRSNG Polytechnique-UQAT en environnement et gestion des rejets miniers, École Polytechnique, D. Laflamme, QIT Fer et

Traduction simultanée | Simultaneous translation

Titane , M. Benzaazoua, Chaire industrielle CRSNG Polytechnique-UQAT en environnement et gestion des rejets miniers, UQAT

Fermetures des haldes de stériles en climat froid – Processus de sélection et méthodes implantées | Waste rock dump closures in cold climates – selection processes and implemented methods M. Noël, SRK Consulting

15h10 — Politique et réglementation et Mines & société | Policies and Regulations in Mining & Society Mines et développement durable | Mines and sustainable development J. Pagé, Xstrata Nickel, Raglan Mine

NOAMI et le Bon Samaritain – approches préconisées au Canada | NOAMI and the good samaritan – recommended approaches in Canada G. Tremblay, Ressources naturelles Canada

Le défi de la biodiversité pour les opérations minières canadiennes d’Xstrata | The biodiversity challenge at Xstrata Canadian operations R. Prairie, Xstrata Zinc Canada

Nettoyage de sites d’exploration minière abandonnés au Nunavik : historique et ententes | Cleaning of abandoned mining exploration sites in Nunavik: history and agreements D. Blackburn, Ministère des Ressources naturelles du Québec

Mardi | Tuesday AM 8h15 — Qualité des eaux | Contaminated Water Outils pour déterminer les niveaux acceptables de charges en métaux dans l’environnement aquatique – une étude portant sur des rivières du nord-ouest québécois qui reçoivent des effluents miniers | Tools for determining permissible metal loadings to the aquatic environment – a study of rivers in northwestern Quebec that receive mine effluents Y. Couillard, Existing Substances Division, Science and Risk Assessment Directorate, Environment Canada, P.G.C. Campbell, L. Hare, INRS Eau Terre et Environnement, INRS, Université du Québec, A. Hontela, Department of Biological Sciences, University of Lethbridge, L. Martel, Centre d’expertise en analyse environnementale du Québec (CEAEQ), Ministère de l’environnement du Québec, B. Pinel-Alloul, Département des Sciences biologiques, Université de Montréal

Avancées concernant le traitement biologique des effluents de mines d’or | Advances in the biological treatment of gold mine effluents P. Juteau, V. Bougie, INRS-Institut Armand-Frappier, S. Bérubé, Agnico-Eagle Mines Ltd.

Toxicité et spéciation des métaux dans du drainage minier acide traité par bioréacteur passif | Toxicity and metal speciation in acid mine drainage treated by passive bioreactors C.M. Neculita, École Polytechnique de Montréal, B. Vigneault, Metals and the Environment Program, Mining and Mineral Sciences Laboratories, Natural Resources Canada, G.J. Zagury, Department of Civil, Geological, and Mining Engineering, École Polytechnique de Montréal

Le programme national des études de suivi des effets sur l’environnement pour les mines de métaux | The National Metal Mining Environmental Effects Monitoring Program D. Gautron, C. Gaudet, Environment Canada

10h15 — Restauration des sites | Site Restoration Restauration du site minier abandonné Manitou à l’aide des rejets de concentrateur de la mine Goldex : un état de la situation | Reclamation of the Manitou abandoned mine site using the Goldex mine tailings: a status report J. Cyr, Ministère des Ressources naturelles et de la Faune du Québec, R. Émond, Mines Agnico-Eagle Ltd.

Restauration du site minier Lorraine, Latulippe, Québec : résultats de 10 ans de suivi | Reclamation of the Lorraine mine site, Latulippe, Quebec: results from 10 years of monitoring B. Bussière, Université du Québec en Abitibi-Témiscamingue, Chaire industrielle CRSNG Polytechnique-UQAT en environnement et gestion des rejets, M. Aubertin, École Polytechnique de Montréal , Robin Potvin, Université du Québec en Abitibi-Témiscamingue, Chaire industrielle CRSNG Polytechnique-UQAT en environnement et gestion des rejets, C. Poirier, École Polytechnique de Montréal, Chaire industrielle CRSNG Polytechnique-UQAT en environnement et gestion des rejets, J. Cyr, Ministère des Ressources naturelles et de la Faune, A. Maqsoud, Université du Québec en Abitibi-Témiscamingue, Chaire industrielle CRSNG Polytechnique-UQAT en environnement et gestion des rejets , A.-M. Dagenais, Golder Associés ltée.

Évaluation de l’efficacité à long terme d’une couverture d’eau de faible profondeur pour réduire l’oxidation des résidus réactifs à la mine Louvicourt | Assessing the long-term performance of a shallow water cover to limit oxidation of reactive tailings at Louvicourt mine B. Vigneault, J Kwong, CANMET-MMSL, Natural Resources Canada, L. Warren, McMaster University

Performance sur le terrain des géocomposites bentonitiques utilisés comme barrières hydrogéologiques dans les recouvrements | Field performance of GCLs used as hydraulic barriers in caps C.H. Benson, Department of Civil and Environmental Engineering, University of Washington

Mardi | Tuesday PM 13h15 — Nouvelles tendances | New Trends Les impacts du réchauffement climatique sur le pergélisol au Québec nordique | Impact of climate warming on permafrost in northern Québec M. Allard, Centre d’études Nordiques, Université Laval

Les défis posés par les exploitations d’uranium – description de la technologie utilisée et acceptée en Saskatchewan pour la gestion des rejets miniers et description du processus réglementaire particulier pour l’Uranium | Challenges posed by uranium exploitations – description of the technology used and accepted in Saskatchewan for the management of mine wastes and of the regulatory process for uranium R. Barsi, Golder Associates Ltd.

Défis posés à la recherche sur les Analyses de cycles de vie (ACV) pour l’industrie minière | Life cycle analysis (LCA) research challenges for the mining industry L. Deschênes, M. Margni, École Polytechnique de Montréal

14h45 — Séance plénière | Plenary Session Animateur | Moderator : André Delisle, président, Transfert Environnement Interactions : Panel et auditoire | Panel and audience Durant la séance plénière, des questions seront débattues par un panel composé de leaders d’opinions de divers horizons sur la manière de concilier mines et développement durable au Canada; comment satisfaire la demande mondiale en minéraux, tout en tenant compte de l’impact des activités minières sur la société et l’environnement; et comment intégrer le développement durable dans l’exploration, l’extraction et la production des ressources minérales.

During the plenary session, a panel of opinion leaders from various sectors will debate on how to reconcile mining and sustainable development in Canada; how to satisfy the world demand for minerals while taking into account the impact of mining activities on society and the environment; and how to integrate sustainable development in the exploration, extraction and production of mineral resources.

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Cours intensif Restauration des sites d’entreposage de rejets miniers générateurs de DMA Organisé par la Chaire industrielle CRSNG Polytechnique-UQAT en environnement et gestion des rejets miniers, en collaboration avec la Chaire de recherche du Canada sur la restauration des sites miniers abandonnés. Ce cours intensif présentera un survol de la problématique du drainage minier acide (DMA) et différentes techniques disponibles pour le prévenir ou le contrôler lors de la phase de restauration du site.

Contenu • Introduction • Rappel des exigences règlementaires pour la restauration • Formation du DMA : aspects minéralogiques, processus géochimiques, technique d’évaluation et de prédiction • Rappels sur le mouvement des fluides : écoulement de l’eau et de l’air en milieu saturés et non saturés • Utilisation de l’eau pour contrôler le DMA : théorie et exemples d’application – Recouvrement en eau – Couvertures à effets de barrière capillaire (CEBC) – Nappe surélevée et couverture monocouche • Autres techniques – Couvertures imperméables – CEBC pour contrôler l’infiltration – Couverture à consommation d’oxygène

• Traitement passif des effluents – Drains calcaires – Système de traitement à l’aide de BSR • Discussion sur les progrès récents et les travaux en cours Le cours sera donné par les personnes suivantes : Michel Aubertin, École Polytechnique de Montréal Mostafa Benzaazoua, Université du Québec en AbitibiTémiscamingue Bruno Bussière, Université du Québec en AbitibiTémiscamingue Mamert Mbonimpa, Université du Québec en AbitibiTémiscamingue Carmen Neculita, École Polytechnique de Montréal John Molson, École Polytechnique de Montréal Ward Wilson, University of British-Columbia Date : Le dimanche 2 novembre Heure : De 8 h 30 à 17 h 00 Coûts : 375 $ (inclut matériel du cours, lunch, pauses café) Endroit : Université du Québec en Abitibi-Témiscamingue, Campus Rouyn-Noranda, 445, boul. de l’Université Note : Le cours sera offert en français (avec possibilité d’une présentation en anglais).

www.cim.org/rouyn-noranda2008

Session affiches étudiantes Présentez une affiche reliée aux pratiques minières durables et à l’environnement minier, sur n’importe lequel des sujets du Symposium. Les affiches seront vues par tous les délégués et exposants à cet événement. Saisissez la possibilité de démontrer vos talents.

À qui est-ce adressé?

Aux étudiants gradués qui s’intéressent aux pratiques minières durables et à l’environnement minier.

Quand?

La date limite de soumission est le 1er septembre.

Comment?

Soumettez votre résumé en ligne à http://www.cim.org/ rouynnoranda2008/conference/fr/StudentPoster.cfm, sélectionnez « affiche » en tant que votre session. Le résumé devrait contenir un maximum de 200 mots. Les candidats retenus recevront un avis d’acceptation avant le 15 septembre 2008. Les résumés retenus seront reproduits dans le programme des conférences.

Où?

La session affiches étudiantes se teindra du 2 au 4 novembre 2008 sur la passerelle de l’Hôtel Gouverneur Le Noranda à Rouyn-Noranda, Québec.

La session affiches sera ouverte aux heures suivantes : Le dimanche 2 novembre, de 18 h à 21 h Le lundi 3 novembre, de 9 h 30 à 17 h Le mardi 4 novembre, de 9 h 30 à 17 h 108 | CIM Magazine | Vol. 3, No. 6

Lignes directrices • Les affiches devraient être de type portrait : d’une hauteur de 42 po (~110 cm) sur une largeur de 36 po (~90 cm).

• Il n’est pas obligatoire de rester près de votre affiche durant toutes heures d’ouverture de la session; une présence de 2 à 3 heures est cependant recommandée.

Inscription Les frais d’inscription des candidats retenus seront payés; ils comprennent l’accès aux présentations techniques, au salon commercial, à la réception d’ouverture du dimanche soir et aux déjeuners du lundi et du mardi.

Personne-ressource Vous pouvez contacter Louise Labbé au 819.762.0971 (poste 2558) ou par courriel à louise.labbe@uqat.ca pour toute information additionnelle.

Excursion Visite de sites d’entreposage de rejets miniers L’excursion traversera l’Abitibi d’Ouest en Est et permettra de réaliser une visite guidée des sites d’entreposage de rejets miniers des mines Bouchard-Hébert, LaRonde et GoldexManitou.

Les places seront limitées et l’inscription préalable sera nécessaire. Les vêtements et équipements de protection individuelle seront disponibles sur place.

Date : Le mercredi 5 novembre Heure : De 7h30 à 17h Coûts : 75 $ (inclut le transport et le lunch) Endroit : Le départ et le retour se feront de l’Hôtel Gouverneur Le Noranda

Programme social Le dimanche 2 novembre Cocktail de bienvenue Tous les participants sont invités au cocktail de bienvenue dans le salon commercial, salle la Capitale, de 18h à 21h.

Cet événement est offert gratuitement aux congressistes.

Le lundi 3 novembre Dîner dans le salon commercial Tous les congressistes et exposants sont invités à dîner ensemble au salon commercial, salle la Capitale, de midi à 13h. Le dîner est inclus avec les frais d’inscription. Des billets additionnels seront disponibles à l’inscription au coût de 20 $.

Souper spectacle Tous les congressistes et leurs invités sont conviés à un souper mettant en vedette des produits du terroir local suivi d’un spectacle de haute qualité. Cocktail dans le hall à l’étage à 18 h. Souper dans la salle La Grande de 19h à 22h30.

Le coût du billet est de 75 $.

Le mardi 4 novembre Dîner dans le salon commercial Tous les congressistes et exposants sont invités à dîner ensemble au salon commercial, salle la Capitale de midi à 13h. Le dîner est inclus avec les frais d’inscription. Des billets additionnels seront disponibles à l’inscription au coût de 20 $.

Salon commercial Des fournisseurs mettront en vedette leurs produits et leurs services durant le Symposium. Le salon commercial est l’occasion parfaite pour faire de nouveaux contacts et pour renouer des liens avec des fournisseurs, des entrepreneurs et des consultants.

Les heures du salon seront les suivantes : Dimanche, le 2 novembre de 18h00 à 21h00 Lundi, le 3 novembre de 9h30 à 17h00 Mardi, le 4 novembre de 9h30 à 17h00

Comité organisateur | Organizing committee Président | President Denis Bois, Université du Québec en Abitibi-Témiscamingue (URSTM)

Programme technique | Technical program Michel Aubertin, CRSNG Polytechnique-UQAT en environnement et gestion des rejets miniers (École Polytechnique de Montréal) Jean-Claude Belles-Isles, Association minière du Québec (AMQ) Mostafa Benzaazoua, Chaire de recherche du Canada en gestion intégrée des rejets miniers sulfureux par remblayage (UQAT) Jean-François Doyon, Mines Agnico-Eagle – division LaRonde Bruno Bussière, Chaire CRSNG Polytechnique-UQAT en environnement et gestion des rejets miniers et Chaire de recherche du Canada sur la restauration des sites miniers abandonnés, Université du Québec en AbitibiTémiscamingue Johanne Cyr, Ministère des Ressources naturelles et de la Faune (MRNF) Michel Julien, Golder Associés Gilles Tremblay, programme NEDEM

Cours intensif | Short courses Michel Aubertin, CRSNG Polytechnique-UQAT en environnement et gestion des rejets miniers (École Polytechnique de Montréal) Bruno Bussière, Chaire CRSNG Polytechnique-UQAT en environnement et gestion des rejets miniers et Chaire de recherche du Canada sur la restauration des sites miniers abandonnés, Université du Québec en AbitibiTémiscamingue

Excursions | Field trips Jean-François Doyon, Mines Agnico-Eagle – division LaRonde Mostafa Benzaazoua, Chaire de recherche du Canada en gestion intégrée des rejets miniers sulfureux par remblayage, Université du Québec en Abitibi-Témiscamingue

Logistique, inscription, salon commercial | Logistics, registration and trade show Chantal Murphy, Institut canadien des mines, de la métallurgie et du pétrole (ICM) / Canadian Institute of Mining, Metallurgy and Petroleum (CIM)

Secrétariat | Secretary Louise Labbé, Université du Québec en AbitibiTémiscamingue September/October 2008 | 109

Short course Rehabilitation of AMD-generating tailings sites Organized by the Industrial NSERC PolytechniqueUQAT Chair in Environment and Mine Wastes Management, in collaboration with the Canada Research Chair in the Restoration of Abandoned Mine Sites. This short course will present an overview of the acid mine drainage (AMD) problem and the various techniques available to prevent or control it during the site rehabilitation phase.

Contents • Introduction • Overview of the rehabilitation regulation requirements • AMD formation: mineralogical aspects, geochemical processes, assessment and prediction techniques • Overview of fluid mechanics: water and air flow in saturated and unsaturated environments • Use of water to control AMD: theory and application examples – Water covers – Covers with capillary barrier effects (CCBE) – Elevated water table and a single-layer cover • Other techniques – Impervious covers – CCBE to control infiltration – Cover with oxygen consumption layer • Passive treatment of effluents – Limestone drains – Treatment system with sulphate-reducing bacteria (SRB) • Discussions on recent progress and on-going projects Presenters Michel Aubertin, École Polytechnique de Montréal Mostafa Benzaazoua, Université du Québec en AbitibiTémiscamingue Bruno Bussière, Université du Québec en AbitibiTémiscamingue Mamert Mbonimpa, Université du Québec en AbitibiTémiscamingue Carmen Neculita, École Polytechnique de Montréal John Molson, École Polytechnique de Montréal Ward Wilson, University of British Columbia Date: Sunday, November 2 Time: 8:30 to 17:00 Cost: $375 (includes course material, lunch, and coffee breaks) Location: Université du Québec en AbitibiTémiscamingue, Rouyn-Noranda Campus, 445, de l’Université Blvd.

Note: The course will be given in French (with one possible presentation in English).

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Student poster session Present a poster on the full range of symposium topics related to practices in sustainable mining and mining and the environment. Posters will be seen by all delegates and exhibitors at the event. Grab the opportunity to showcase your talents.

Who can submit a poster?

Graduate students interested by sustainable mining practices and mining and the environment.

When?

The submission deadline is September 1, 2008.

How? Submit your abstract online at http://www.cim.org/rouynnoranda2008/conference/StudentPoster.cfm, selecting “poster” as your session. The abstract should not exceed 200 words. Successful candidates will receive notification of acceptance by September 15, 2008. Accepted abstracts will be reproduced as part of the conference program.

Where?

The student poster session will be held on the footbridge of the Hotel Gouverneur le Noranda from November 2 to 4, 2008 in Rouyn-Noranda, Québec. The poster session will follow the exhibit hours.

Guidelines Posters should be of portrait type, 42 inches tall by 36 inches wide. It is not compulsory to attend to your poster full time, however two to three hours’ attendance at the poster display site is recommended.

Registration Successful candidates will have their registration paid.

Registration includes access to the technical presentations, the trade show, the Sunday night opening reception and luncheons on Monday and Tuesday.

Contact For further information, contact Louise Labbé at 819.762.0971 (ext. 2558) or louise.labbe@uqat.ca.

Field trip Visit to Bouchard-Hébert, LaRonde and Goldex-Manitou mines The field trip will cross Abitibi from west to east on a guided tour of the mine waste management facilities of the Bouchard-Hébert, LaRonde and Goldex-Manitou mines.

Places are limited and pre-registration is required.

Individual safety equipment and clothing will be available onsite.

Date: Wednesday, November 5 Time: 7:30 to 17:00 Cost: $75 (includes transportation and lunch) Departure: The trip will depart from and return to the Hôtel Gouverneur Le Noranda

Trade show Suppliers will showcase their products and services at this year’s symposium. The trade show is a great opportunity to drum up some business while reconnecting with suppliers, contractors and consultants.

Trade show opening hours: Sunday, November 2, from 18:00 to 21:00 Monday, November 3, from 9:30 to 17:00 Tuesday, November 4, from 9:30 to 17:00

Social program Sunday, November 2 Welcoming reception All delegates are invited to the Welcoming Reception in the trade show, from 18:00 to 21:00. This event is free for delegates.

Monday, November 3 Lunch in the trade show All delegates and exhibitors are invited to have lunch together in the trade show, from 12:00 to 13:00. The luncheon is included with registration. Additional tickets will be available for $20 at the registration desk.

Banquet All delegates and their guests are invited to a supper featuring local produce, followed by a fantastic show.

Cocktails are at 18:00 in the hall of the upper level.

Dinner follows in the La Grande Room from 19:00 to 22:30. Tickets are $75.

Tuesday, November 4 Lunch in the trade show All delegates and exhibitors are invited to have lunch together in the trade show, from 12:00 to 13:00. The luncheon is included with registration. Additional tickets will be available for $20 at the registration desk.

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2008 PROFESSIONAL DEVELOPMENT SEMINAR SERIES

STRATEGIC RISK QUANTIFICATION AND MANAGEMENT FOR ORE RESERVES AND MINE PLANNING Quantitative mineral resource assessment an integrated approach: Exploration risk analysis for strategic planning October 20-21, Montreal Don Singer, US Geological Survey, USA; David Menzie, US Geological Servey, USA

Learn how to provide decision-makers with unbiased information about the expected value and probabilities of other values of undiscovered mineral resources. Learn how to: • Identify the sources and magnitudes of risk and uncertainty in assessments of undiscovered mineral resources. • Demonstrate how operational mineral deposit models can reduce uncertainties. • Construct internally consistent models.

Theory and practice of sampling particulate materials October 27-29, Part 1, Montreal October 30-31, Part 2 (QA-QC, mine, and project audits), Montreal Dominique François-Bongarçon, AGORATEK, USA

Develop an understanding of the theory of sampling particulate materials, its practice, scope, limitations and appropriate applications. Discover: • Eye-opening facts you may have overlooked or ignored until now about the consequences of bad sampling and the difficulties of good sampling. • The unsuspected amplitude of economic ramifications of poor sampling.

Mineral project evaluation techniques and applications: From conventional methods to real options COSMO Lab Mining Engineering

For registration and information please contact: Deborah Frankland Dept. of Mining and Materials Engineering McGill University Montreal, Quebec

November 10-13, Montreal Michel Bilodeau, McGill University, Canada

.GCTP VJG DCUKEU QH GEQPQOKE ſPCPEKCN GXCNWCVKQP VGEJPKSWGU CU YGNN CU VJG RTCEVKECN KORNGOGPVCVKQP QH VJGUG techniques to mineral project assessments. Learn how to: • Gain a practical understanding of economic/financial evaluation principles. • Develop the skills necessary to apply these to support mineral project decisions. • About the real options approach to valuing mining projects.

Upcoming 2009 Seminar • Applied risk assessment for ore reserves and mine planning: Conditional simulation for the mining industry May, Montreal Roussos Dimitrakopoulos, McGill University, Canada •

Geostatistical mineral resource/ore reserve estimation and meeting the new regulatory environment: Step by step from sampling to grade control September, Montreal Michel Dagbert, Geostat Systems International, Canada; Jean-Michel Rendu, Consultant, USA; and Roussos Dimitrakopoulos, McGill University, Canada

•

Strategic risk management and applied optimization in mine design September, Montreal Cindy Campbell, Gemcom, Australia; and Roussos Dimitrakopoulos, McGill University, Canada

Email: admcrc.mining@mcgill.ca Phone: (514) 398-4755, ext. 089638 Fax: (514) 398-7099

Website: www.cim.org http://cosmo.mcgill.ca

history Homestake, South Dakota (Part 2)*

by R.J. “Bob” Cathro Chemainus, British Columbia

“The stamp-mill as a combined orecrushing and gold-saving device was never put to more successful use than by the Homestake Company. The success was due in large part to the design of the mortar, which combined two excellent features: an opportunity for amalgamation and a rapid discharge of pulp … (which) gives a capacity nearly twice that of the ordinary California battery.”

(RICKARD, 1932))

Erratum The captions accompanying the pictures on page 76 of the June/July 2008 issue (Vol. 3 No. 4) were inadvertently transposed. The picture on the right actually depicts the Severance & Holt No. 1 prospecting drill, while the one on the left is that of the Ingersoll rock drill. The author thanks Ken Pawliuk for his interest in the series and for being such a sharp reader.

* The history in this article is derived mainly from Cash (1973), Fielder (1970) and Watkins (1971). Greever (1963) and Petersen (1991) are useful for background reading.

The Black Hills are situated mainly in western South Dakota but overlap slightly into Wyoming. The gold district occurs within an intensely folded and metamorphosed core of Early Proterozoic and Archean rocks that are exposed in a northwest-trending oval about 100 kilometres long and 40 kilometres wide. The core has been intruded by two stages of igneous rocks: amphibolite bodies derived from Proterozoic gabbroic rocks, and small porphyritic stocks, sills and dykes of Tertiary age that range in composition from rhyolite to syenite. The Proterozoic rocks are surrounded by concentric bands of Palaeozoic and Mesozoic rocks that dip gently away from the core.

The Homestake mine and nearby smaller deposits occur in the northern part of the Proterozoic core and are centred about 35 kilometres east of the Wyoming border. The first rich placer paystreaks, which proved to be small, were found in a creek on the northeast side of a high ridge named Deadwood Gulch. The drainage on the southwest side of the ridge, named Gold Run Gulch, hosts the Homestake mine. (In yet another example of how key place names were carried from one significant mining camp to another, the name Gold Run was also given to one of the main creeks in the Klondike Goldfield, Yukon, in 1896).

The city of Deadwood grew into the unofficial ‘capital’ of the new camp, with a population of 10,000 by the spring of 1877.

It has been memorialized in history by such names as Calamity Jane, Deadwood Dick, and Jack McCall and his victim ‘Wild’ Bill Hickok. Although the popular image is of shoot-outs, lynchings, brawls, murders and robberies, mining engineer Louis Janin, an associate of George Hearst, found it quite different when he visited in July 1878. He reported, “All the conveniences and even Map of South Dakota showing the location of the the luxuries of life can be obtained (there) Black Hills and the town of Lead, courtesy of … It is by no means the rough mining camp Mike Cathro. that exists in the imagination of many. On the contrary, it is one of the pleasantest of all mining localities I have visited; and in no other district is justice more ably administered, or greater security afforded to life and property” (Watkins, 1971, p. 114-115).

The Homestake mine was discovered about four kilometres from Deadwood soon after the first placer claim was located in Gold Run Gulch by Thomas E. Carey in February 1876. The entire gulch was soon staked, and overstaked, several times with both placer and lode claims. The town of Lead (a word rhyming with greed that was used by prospectors to describe a vein) was surveyed downstream from the Homestake claim, and cabins were soon built on any lots that were flat enough. Before long, shafts were sunk and adits were driven beside each cabin and on each claim. As a result, the town was built and rebuilt as the distribution of the mineralization became known and it became clear which areas were more valuable for mineral potential than as building lots. By the end of 1880, the population of Lead was about 1,500, much smaller than that of Deadwood.

George Hearst returned to the Homestake property with a small team of managers and lawyers in October 1877, a month before the incorporation of the September/October 2008 | 113

economic geology Homestake Mining Company, to select a mill site straddling below 300 metres and the company had produced over $60 the Homestake and Golden Star claims and ensure a smooth million worth of gold. In 1902, the company owned 350 key startup for the mill. However, he quickly realized that the claims covering an area of about 1,060 hectares, which had mineralization was much more extensive than originally resulted in a substantial increase in ore reserves. The property thought and concluded that the potential for costly and increased to 654 lode claims covering 2,280 hectares by 1931. lengthy legal disputes was extremely high because of apex Although the grade of the Homestake ore was relatively law and overstaking disputes. The legal problems were exac- low for this era, it proved quite profitable because it was erbated by the fact that the earliest staking in the gold dis- mined at such a large scale. Other important reasons for trict had taken place while it was still Indian Territory and success were that the ore proved to be highly amenable to not covered by U.S. law. In addition, he recognized that an simple crushing and grinding, and that the gold grains adequate water supply was critically important if develop- could be easily separated from the sulphide and other ment was not to be impeded. Within a short time, several gangue mineral. George Hearst recognized these advantages neighbouring owners were already building their own mills early and summarized them (in the same May 1878 letter and Hearst appreciated that consolidation of the best claims referred to above) as follows: “You must wake up Tevis [the under a single owner would result in more efficient develop- third partner in the syndicate] to the importance of protectment. These challenges kept ing our interest here, for him at the camp until at least while the quartz is not very May 1878. rich, the amount of quartz His growing optimism for that will pay a profit is truly the economic potential of enormous.” That may have the camp, combined with his been the source of his experience, judgement and favourite toast: “Here’s to strong personality, drove his low-grade ore and plenty of aggressive program of acquiit” (Cash, 1973, p. 112). sition and consolidation of Rickard (1932) divided water rights and key mineral the history of the claims, placer rights and Homestake mine into three building lots. He expressed main stages. The first, this optimism in a letter extending to 1890, conwritten to his partner James sisted of development, Haggin in May 1878, as fol- Aerial view to the northwest of the town of Lead and the ‘Glory Hole’ in 2005, with including road and rail conthe Ross shaft headframe at the lower left, courtesy of Johnny Sundby Photography. lows: “You, nor your chil- Rapid City, South Dakota. struction, shaft sinking, mill dren, will never live to see construction and improvethe end of the time when this property will not be worked ments in stamp-milling. Because of the steep slopes, mining for a profit” (Fielder, 1970, p. 57). Mine developers often was conducted initially with a series of open cuts that gradmake statements like that but, in this case, Hearst wasn’t ually resulted in one large open pit. Difficulty in finding speaking publicly as a promoter trying to raise money, and miners who were experienced in surface mining hastened he was proven right! the introduction of underground mining methods. Because Hearst returned to the project for the last time in March of the large thicknesses of some oreshoots, they were sup1879, in time for the arrival of a second steam-powered mill ported initially with square sets like those used at of 120 stamps. By this time, the company employed 500 Comstock, but the mining method was changed to shrinkmen in ten operating mines and mills using 540 stamps. In age stoping when the ground was found to be quite solid.

April, after a fatal shaft accident, the company began to iniThe second stage, between 1890 and about 1910, was tiate a community medical service and a company hospital, marked by expansion. The mining and milling rate was one of the earliest industrial health services of the era. His gradually increased until there were 1,000 stamps operating efforts were directed mainly to claim and water rights nego- in six mills in 1912. As the mine went deeper and an undertiations as well as evaluating the ore potential of the various ground fire broke out, the upper timbered portions began to properties. When he returned to San Francisco in collapse, ultimately resulting in a huge ‘Glory Hole’ over September, he left the growing operation in the capable 250 metres deep that gradually swallowed part of the origihands of Sam McMaster, an experienced mine operator with nal town. The use of mill tailings for backfill, instituted in a good understanding of the local geology.

1932, brought the problem under control.

Over $500,000 was spent on claim acquisition from 1892 to In addition to better efficiency achieved with large-scale 1894, and even more was invested in 1899 and 1900, taking mining, two other factors contributed to the success of the advantage of slowdowns in gold mining speculation. By 1900, operation. One was the creation of a geology department in the payroll had risen to 1,500, several shafts had been sunk 1920, with Lawrence Wright as the first mine geologist 114 | CIM Magazine | Vol. 3, No. 6

economic geology (Spence, 1970), and a new emphasis on geological research.

Pioneer geologists such as Donald McLaughlin, John Gustafson, James Noble, Clarence Kravig, James Harder and Archie Slaughter made key discoveries that expanded the mine (Caddey, Bachman, Campbell, Reid, & Otto, 1992). The main initiative, however, was a strong effort to improve gold recovery by reducing the losses from the amalgamation process used with the stamp-mills. After experimenting with tables and jigs and obtaining slight gains, Homestake achieved a major advance using a combination of fine grinding and cyanidation of the stamp-mill tailings. This was a major metallurgical breakthrough that had profound impacts on the global gold industry, including an explosion in gold production in South Africa. One of the unintended consequences was the creation of new opportunities for the study of economic geology.

Proterozoic stratigraphy, Homestake district, South Dakota (from http://www.lbl.gov/nsd/homestake/Posters.html).

Carl Wilhelm Scheele (1742-1786), a chemist who was born in Stralsund, Germany, while it was under Swedish rule, discovered hydrocyanic (prussic) acid (HCN) in 1783 and found that it could dissolve gold. This unique quality wasn’t applied to gold mining until 1887, when a process was developed in Glasgow by John Stewart MacArthur, an industrial chemist, with funding by brothers Robert and William Forrest. It consisted of two steps: dissolving the gold from the crushed ore in a weak sodium cyanide solution and then precipitating the gold with zinc chips. The MacArthur-Forrest process was tested extensively worldwide, including at a mine at Deadwood in 1892, where it was not very effective.

Metallurgist Charles W. Merrill patented an improvement to the process in the United States that substituted zinc dust for zinc chips, which had proven inefficient because too much gold was allowed to remain in solution as it passed through. He was given a five-year contract in 1898 to increase gold recovery at Homestake, and a 60-ton per day pilot plant was constructed the next year to treat the tailings from the Amicus mill. When it proved successful, the process was added to all the mill flow sheets in 1901. By experimenting with the oxygen levels and the cyanide content of the solution, adjusting the retention time in the circuit and introducing filtration, gold recovery was increased from 72 per cent, using amalgamation only, to 88 per cent in

1902 and 94 per cent by 1908. After Thomas B. Crowe made additional improvements for the Merrill Company, it became known as the Merrill-Crowe process.

Even after more than a century of use worldwide, the cyanide process remains controversial. It has been found that weak cyanide solutions are not hazardous to human health but are extremely toxic to fish and waterfowl, and several well-publicized spills have resulted in it being totally banned in several jurisdictions. Modern plants typically use a cyanide solution of 0.05% sodium cyanide and are carefully monitored because the solution has to be kept alkaline to prevent the release of hydrogen cyanide, which is very volatile and highly toxic. In 1973, use of the process on crushed ore placed on surface pads, called heap leaching, was pioneered by Placer Development Ltd. at the Cortez mine in Nevada.

The Homestake mine, which reached a depth of 2,485 metres, was incredibly successful, producing over 500,000 ounces of gold annually between 1934 and 1973. In total, 167.6 million tons (151.6 million “The Miner’s Legend,” a plaque dedicated to its tonnes) of ore were employees by Homestake Mining Co. in Lead, South milled until mine Dakota. Photo courtesy of ‘Dutch’ Van Tassell. closure in 2002 to yield approximately 39.61 million ounces (1,100 tonnes) of gold and 9 million ounces (255 tonnes) of silver. The recovered grade was 0.237 oz/ton (8.13 g/t) gold and 0.054 oz/ton (1.85 g/t) silver. Rickard (1932) estimated that the total value of the production for the 42-year period from 1888 to the end of 1930 was approximately $223 million, with gold priced at $20.67/oz. About $59 million was paid as dividends during that period, a remarkable payout rate of 26 per cent. CIM

References Cash, J.H. (1973). Working the Homestake. Ames: The Iowa State University Press.

Caddey, S.W., Bachman, R.L., Campbell, T.J., Reid, R.R., & Otto, R.P. (1992). The Homestake gold mine, an Early Proterozoic iron-formation-hosted gold deposit, Lawrence County, South Dakota, U.S. Geological Survey Bulletin 1857. Washington: United States Government Printing Office, pp. J1-J67.

Fielder, M. (1970). The treasure of Homestake gold. Aberdeen, SD: North Plains Press.

Greever, W.S. (1963). Bonanza west: the story of the western mining rushes 1848-1900.

Moscow: University of Idaho Press.

Peterson, R.H. (1991). The bonanza kings: the social origins and business behaviour of western mining entrepreneurs, 1870-1900. Norman: University of Oklahoma Press.

Rickard, T.A. (1932). A history of American mining. New York: McGraw-Hill Book Company, Inc. Spence, C.C. (1970). Mining engineers & the American West: the lace-boot brigade, 18491933. New Haven: Yale University Press.

Watkins, T.H. (1971). Gold and silver in the West: the illustrated history of an American dream.

Palo Alto: America West Publishing Company.

September/October 2008 | 115

metallurgy Migration and movement of scholars A study in the history of diffusion of knowledge: Part 6

by Fathi Habashi, Department of Mining, Metallurgical, and Materials Engineering, Laval University

The beginning of the chemical and metallurgical industries in Britain

August von Hofmann 116 | CIM Magazine | Vol. 3, No. 6

Because the chemical and metallurgical industries are closely related, the teaching of chemistry deeply impacted the teaching of mining and metallurgy in England. Prince Albert, who in 1840 had married Queen Victoria, actively promoted scientific education in England. He won several British landowners and industrialists over to the cause of a College of Chemistry. The Prince, of German origins himself, wanted to model his college on Justus von Liebig’s laboratory, a famous German chemical education centre. He personally negotiated the hiring of August von Hofmann (1818-1892) with the King of Prussia.

Prince Albert invited Liebig to London and had one of his former students, Lyon Playfair, serve as his guide. Playfair translated Liebig’s work into English and became the first professor of chemistry when the Royal School of Mines was founded in 1863 in London. In 1845, the Royal College of Chemistry was opened, with Hofmann, another Liebig student, as its first director. This was the first English institution to systematically teach chemistry.

Hofmann’s enthusiasm attracted to the college many English youths interested in applied chemistry. Alongside teaching, Hofmann conducted research on coal tar, continuing the four years’ work he had previously done with Liebig. In 1851, Prince Albert sponsored the foundation of the Geological Surveys to develop the mineral riches of Britain and her colonies. This led to the foundation of the Government School of Mining and Science Applied to the Arts. The new school was housed with the Geological Surveys at the Museum of Practical Geology, also opened in 1851.

Prominent Surveys’ officials taught at the school.

In 1853, William Henry Perkin (1838-1907), a student of Hofmann’s at the Royal College of Chemistry, synthesised mauvein, the first artificial dye, initiating the science of synthetic dyes. Another Hofmann student, Peter Griess (1829-1888), left Germany for England in 1858. Studying the action of nitrous acid on amines, he discovered the diazotization process for making azo dyes. Hofmann succeeded Playfair at the Metropolitan School of Science and Industry in 1856, where he stayed until 1863 when he moved to the University of Berlin, becoming one of the founders of the German Chemical Society.

Among the numerous German chemists who moved to England during this period were Carl Schorlemmer (1834-1892), Ivan Levinstein (1845-1916) and Ludwig Mond (1839-1909).

Schorlemmer came to Manchester in 1861 to work with Henry Roscoe, who had studied with him under Bunsen at Heidelberg. Together, they wrote a multi-volume Treatise on Chemistry comprising three volumes on inorganic chemistry and seven on organic chemistry. Levinstein arrived at the age of 19 and in 1865 founded a company in Blackley, near Manchester, for the manufacture of aniline dyes. This later became the British Dyestuff Corporation, the founding Prince Albert

metallurgy company of Imperial Chemical Industries (ICI). Mond came to England in 1862 and founded a company in Manchester which later became part of ICI for the manufacture of soda and other inorganic compounds. He also invented, with Austrian emigrant Carl Langer, the carbonyl process for refining nickel. His son, Robert Mond (18671938), was director of the International Nickel Company (Inco).

There were other German chemists who went to England but later returned to Germany.

Friedrich Accum (1769-1838), a famed author of numer- Ludwig Mond ous books on practical chemistry, went to England in 1793 to teach chemistry and physics at the Surrey Institute. He worked first at Chartered Gaslight and Coke in London, then as a librarian at the Royal Institution before returning to Berlin in 1822 to teach at the newly founded trade school. Auguste Kekulé, who eventually returned to Germany, discovered the structure of benzene in 1860 while in London. In 1863, Wilhelm Meister founded Farbwerke Hoechst and in 1868, Heinrich Caro joined BASF, becoming its first technical director.

In 1863, Hofmann returned home to a professorship at the University of Berlin. This coincided with the beginning of the German dyestuff industry and the founding of Bayer, Hoechst and Kalle in 1863, Badische Anilin- und Sodafabrick (later, BASF) in 1865, and Aktiengesellschaft fur Anilinfabrikationen (later, AGFA) in 1867.

Although the synthetic dye industry began in England, the British Government did little to support it. Britain already had vast natural resources in the colonies and the prospects of synthetic chemicals seemed dim. Also, the fact that many little-trained inventors had driven England’s remarkable Industrial Revolution, had led to the belief that theoretical training was not essential to the development of revolutionary technologies. Consequently, the German industry, with its greater impetus on formal technical education, outpaced its British counterpart.

In 1843, the German engineer Wilhelm Siemens (18251883) built furnaces for the English glass industry and later, in 1862, for steelmaking. He invented the regenerative system for furnaces and, in 1878, pioneered the use of electric arcs for smelting metal in closed hearths. He was later knighted.

England was a popular destination for many German emigrants in Hanover because George Lewis (16601727), great grandson of James I of England, was born in

Hanover. In 1714, on the death of Queen Anne, he became George I, King of England. Consequently, the duchy of Hanover belonged to the kings of England.

George I lived in Hanover, spoke no English, and visited England only once. He was succeeded in 1727 by his son George II, also born in Hanover. It was during his rule that New France was conquered and India became part of the British Empire.

One distinguished Hanover immigrant was Friedrich Wilhelm Herschel (1738-1822) who discovered Uranus.

His son, John Friedrich Herschel (1792-1871), also made important astronomical discoveries and built an observatory near Cape Town. In 1850, he became Master of the Mint in London.

The movement of scientists in recent times Jacobus van’t Hoff (1852-1911) was born in Rotterdam and studied in Germany and France before returning to the University of Utrecht to obtain his doctorate in 1874. In the meantime, he had published an important paper postulating a tetrahedral structure for the carbon atom. In 1878, he was appointed professor of chemistry, mineralogy and geology at the University of Amsterdam, where he wrote the first book on chemical kinetics. In 1896, he moved to the University of Berlin, and in 1901, was awarded the first Nobel Prize in Wilhelm Siemens Chemistry.

Wilhelm Ostwald (1853-1932), born in Riga, Latvia, studied at the University of Dorpat (now Tartu, Estonia).

He obtained his doctorate in chemistry in 1878. He was appointed professor of chemistry at the Riga Polytechnic Institute in 1881 and in 1887 moved to the University of Leipzig. He received the Nobel Prize in Chemistry in 1909 for his contribution to the theory of electrolytic solutions and to thermodynamics.

Svante August Arrhenius (1859-1927) studied at Uppsala in Stockholm, and at Riga with Wilhelm Ostwald. He then worked in Germany and in Amsterdam with van’t Hoff. In 1891, he was appointed lecturer and in 1895, professor of physics at the Technical University in Stockholm. He was director of the Nobel Institute at Stockholm from 1905 until his death. Best known for his ionization theory of solutions, Arrhenius won the Nobel Prize in Chemistry in 1903.

William Henry Bragg (1862-1942), educated at Cambridge, became professor of mathematics at Adelaide in South Australia. In 1909, he returned to September/October 2008 | 117

metallurgy Leeds and in 1915, became professor of physics at Montreal and with Ramsay in London. In 1914, he became London University. His son, William Lawrence Bragg professor of chemistry at Aberdeen and in 1919, at (1890-1971), born in Adelaide, shared the Nobel Prize Oxford. He received the Nobel Prize for Chemistry in with his father in 1915. Ernest 1921 for his work on isotopes. Hans Rutherford (1871-1937), born in New Geiger (1882-1945), born in Zealand, was a research student at Neustadt a.d. Haardt in Germany, Cambridge University and, later, proworked with Rutherford in Manchesfessor of physics at McGill University ter. In 1925, he was appointed at the in Montreal (where he worked on Berlin Technical Institute, where he radioactivity) and the universities of invented the eponymous counter for Manchester and Cambridge. He won measuring radioactivity. the Nobel Prize in Chemistry in 1908.

Otto Hahn (1879-1968) was born Vladimir Ipatieff (1867-1952), born in Frankfurt am Main in Germany. in Moscow, studied at the Artillery He obtained a doctorate in organic Academy in Saint Petersburg, becomchemistry from the University of ing professor there after graduation in Marburg in 1901. He left for England 1892. He emigrated to the United in 1904 to work with William States in 1931 to direct research at Ramsay at University College. There, Ernest Rutherford Universal Oil Products in Chicago. His in 1905, he discovered radiothorium work on the precipitation of metals (an isotope of thorium). Later that from aqueous solutions by hydrogen year, he left to work with Ernest was applied in Canada 50 years later to Rutherford in Montreal, where, in produce metallic nickel and cobalt.

1906, he discovered radioactinium In 1879, the young Joseph Mellor (another thorium isotope). He then (1869-1938) moved with his family returned home to work at the from England to New Zealand. His University of Berlin. In 1907, he disworking-class background ruled out covered mesothorium (a radium isoany thoughts of higher education. tope). That year, Lise Meitner joined Aged 13, he left school to take his laboratory. In 1918, with Meitner, employment in boot manufacturing. he discovered proto-actinium (proVladimir Ipatieff In the evenings, however, he read sectoactinium). In 1933, he was visiting ond-hand or borrowed books. Mellor’s professor at Cornell University. On remarkable efforts at self-education returning to Berlin, he moved to the came to the attention of the director of Kaiser Wilhelm Institute for the local technical school, who Chemistry. arranged for him to attend classes at Between 1935 and 1938, Hahn, the University of Otago in Dunedin. In Meitner and Strassmann repeated 1898, he graduated with first-class Fermi’s experiments (bombarding honours and won a scholarship to uranium with neutrons). They constudy in Manchester, England. Mellor firmed the transuranium element and published five books on inorganic believed they had discovered several chemistry (1912-30) and numerous isotopes of radium. In 1939, Hahn Joseph William Mellor pioneering texts on mathematics for and Strassmann announced the chemists (1902), chemical kinetics “bursting” of uranium atoms. In (1904), quantitative chemical analysis 1945, Hahn was arrested, along with (1914), clay and pottery (1914) and several colleagues, by the allied forces metallography (1916). His major and interned near Cambridge, work, however, is a monumental 16England. He was awarded the 1944 volume, 15,320-page Comprehensive Nobel Prize for Chemistry during his Treatise on Theoretical and Inorganic internment. In 1946, he returned to Chemistry, published between 1927 West Germany to become president and 1937. of the Kaiser Wilhelm Society, which Frederick Soddy (1877-1956) was changed its name in 1948 to the Max born in Eastbourne, England. He Planck Society in honour of the worked with Rutherford at McGill in deceased scientist. CIM Otto Hahn 118 | CIM Magazine | Vol. 3, No. 6

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TO INDUSTRY KNOWLEDGE Peer reviewed by leaders in their fields 120

Exploration and Mining Geology Journal Volume 17, Number 1 and 2

121

Canadian Metallurgy Quarterly Volume 47, Number 1

Complete CIM Bulletin papers are posted in the online Technical Paper Library

www.cim.org September/October 2008 | 119

emg abstracts

Exploration and Mining Geology Journal Volume 17—Numbers 1 and 2 Deformation and Structural Controls on Gold Mineralization in the Clarence Stream Shear Zone, Southwestern New Brunswick, Canada A.F. Park, D.R. Lentz, Department of Geology, University of New Brunswick, Fredericton, New Brunswick, and K.G. Thorne, New Brunswick Department of Natural Resources, Fredericton, New Brunswick The Main zone of the Clarence Stream gold deposit is hosted by a shear zone adjacent to the Saint George batholith in southwestern New Brunswick. The mineralization history relates to progressive deformation in the shear zone and the intrusion of the Magaguadavic granodiorite.

Of three phases of deformation that have affected the area (D1–D3), D1 is not observed in the Clarence Stream shear zone. Two suites of igneous rocks intrude the shear zone: post-D2, pre-D3 gabbro; and granitic dikes, which crosscut the gabbros. Granitic dikes show a diverse range of relationships to D3 features, from pre-syn-D3 mylonitic fabrics in transposed and highly deformed enclaves, to nondeformed and entirely discordant dikes (post-D3).

A variety of veins occur within this shear zone. Zoisite-bearing and later, crosscutting epidotebearing veins are preserved as relics in quartz-mylonites, and predate quartz veins that host gold mineralization. The epidote-bearing veins are associated with pseudotachylitic cataclasite dikes, consistent with transient brittle failure during ductile deformation.

Deformation relates to right-lateral strike-slip motion across the shear zone, and subhorizontal and near-vertical stretching lineations imply transpression. A late (late- or post-D3) dip-slip phase of motion is also apparent, and cooling followed a metamorphic peak early in D2–D3 history. Deformation of the shear zone, and more localized transient brittle failure, provided the permeability for fluid movement and vein emplacement. This scenario is similar to the findings of other studies, in which geochemical, tracer isotopic, and age-dating (U/Pb, 40Ar/39Ar) results suggest that the adjacent Magaguadavic granodiorite provided heat and metals.

Architecture of Gold Mineralization at Anomaly A of the Clarence Stream Deposits, Southern New Brunswick J.-F. Ravenelle, Department of Earth and Planetary Sciences, McGill University, Montréal, Québec, G.G. Lutes, Geological Consultant, Hanwell, New Brunswick and A.J. Hynes, Department of Earth and Planetary Sciences, McGill University, Montréal, Québec The Anomaly A area of the Clarence Stream gold deposits in southwestern New Brunswick contains mineralized structures that bear geometrical relationships to regional folding events. The four mineralized zones of Anomaly A (AD, MW, 93, and Murphy) are hosted by turbiditic graywacke, quartzose wacke, siltstone, and argillite sequences of the Kendall Mountain Formation. A regional scale structural analysis reflects at least four deformational events, three of which appear to control the folded geometry of Anomaly A (D2, D3, and D4). F2 and F3 folds are coaxial and are refolded into a dome and basin geometry by F4 folds. The mineralized zones are subparallel to axial surfaces of F2 folds. Structural analysis of a mineralized zone exposed at surface indicates that gold mineralization is hosted by a quartz-vein system that comprises veins generated during both D2 and D3. Three-dimensional representations Excerpts taken from abstracts in EMG, of Anomaly A created using drill-core data and ®GoCAD sugVol. 17, Numbers 1 and 2. gest that the quartz-vein system was emplaced in fault strucSubscribe—www.cim.org/geosoc/indexEMG.cfm tures during D2 as well as within brecciated dilation zones during D3. Three of the four zones that make up Anomaly A have F2 hinge surfaces that can be linked through a geometry compatible with the style of F3 and F4 folds.

The apparent continuity of these three zones indicates the potential for kilometer-scale mineralized structures at Anomaly A. 120 | CIM Magazine | Vol. 3, No. 6

cmq abstracts

Canadian Metallurgical Quarterly Volume 47—Number 1

Contemporary Analyses in Assessing Residual Stress Topographic Images Enclosing a Cold Expanded Hole A.T. Özdemir, Materials Division, Department of Metallurgy Education, Faculty of Technical Education, Gazi University, Ankara, Turkey, and I. Toktas, Machine Design and Construction Division, Department of Mechanical Education, Faculty of Technical Education, Gazi University, Ankara, Turkey Cold expansion of holes is a complex process; therefore, it is of prime importance to assess the three-dimensional nature of residual stresses surrounding a cold expanded hole. In the present work; the method of step drilling and a novel Fourier series solution were abridged to construct the through thickness residual hoop stress pattern available for any orientation around the hole. Secondly and based on the properties of the experimental data, Artificial Neural Network (ANN) modelling was employed to develop and then train the simulation of complete stress pattern encircling the bore. At a specific orientation at the bore, some results of the step drillingFourier series solution, diffraction methods and ANN modelling were in conformity and similitude was valid only for sections through the thickness at which stress gradient was not changing erratically.

Unified Terminology for Strain-Induced Boundaries H.J. McQueen, Mechanical & Industrial Engineering, Concordia University, Montreal, Quebec, E. Evangelista, M. Cabibbo, CNISM/ Dipartimento di Meccanica, Università Politecnica delle Marche, Ancona, Italy, and G. Avramovic-Cingara, Materials Science Engineering, University of Toronto, Toronto, Ontario The terminology of strain-induced or altered boundaries should reflect the mechanism that created them and the function they perform; both are related to the regions they surround or separate. Dislocation glide under applied stress is the primary mechanism in creep (higher rate) and hot, warm and cold working, being less influenced by dynamic recovery mechanism (DRV) as temperature T falls and strain rate rises. After DRV in hot forming, polygonized walls consist almost entirely of regularly arrayed, low-energy, geometrically-needed dislocations; such subgrain boundaries (SGB) during steady state straining continually rearrange in a stable stress-defined substructure. Original GB are disturbed by lattice dislocations and extended under strain; at high T, they migrate locally to become serrated by SGB. Novel Thermal Processing of Dual Phase Steels: I - Microstructural Design M. Westphal, Materials Science and Engineering, McMaster University, Hamilton, Ontario, J.R. Mcdermid, Mechanical Engineering, McMaster University, Hamilton, Ontario, J.D. Boyd, Mechanical and Materials Engineering, Queen’s University, Kingston, Ontario, and J.D. Embury, Materials Science and Engineering, McMaster University, Hamilton, Ontario The possibility of varying the volume fraction, scale and distribution of the non-ferritic phases (NFP) in the final microstructure of dual phase steels has been investigated. The provision of initial microstructures of various length scales prior to intercritical annealing permits the development of dual phase steels in which both the length scale and distribution of the non-ferritic phase can be varied significantly. This results in significant improvements in the range of mechanical properties relative to conventional processing routes. The use of rapid heating into the austenite range prior to intercritical annealing results in the development of bainitic microstructures with useful combinations of strength and ductility. However, this processing route is insensitive to the initial microstructure. Both thermal paths explored in the present work resulted in improved combinations of strength and ductility and can be represented by development vectors on the standard steel design diagram.

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cmq abstracts

Determination of Ms Temperature in Copper-Bearing Microalloyed Steel by the ANN Technique S.K. Ghosh, Department of Metallurgy and Materials Engineering, Bengal Engineering and Science University, Shibpur, Howrah, India, S. Ganguly, School of Materials Science and Engineering, Bengal Engineering and Science University, Shibpur, Howrah, India, P.P. Chattopadhyay, Department of Metallurgy and Materials Engineering, Bengal Engineering and Science University, Shibpur, Howrah, India, and S. Datta, School of Materials Science and Engineering, Bengal Engineering and Science University, Shibpur, Howrah, India The recent study concerns the prediction of MS temperature in copper-bearing microalloyed steel. An attempt has been made to determine the role of Cu and microalloying elements (Ti and B) on the MS temperature individually as well as in combination. For this purpose, a suitable network has been designed for this particular system from the point of view of its predictive ability. A committee of four models which were found to yield lower training and testing error, has been created. The mean of the prediction of the committee members is used for validation of their prediction from the metallurgical point of view. The effects of different alloying/microalloying elements on the MS temperature as predicted by the ANN model has been interpreted in terms of the available metallurgical knowledge.

Influence of Thermally Grown Oxide Scale on Fatigue Resistance of a Thermal Barrier Coated Superalloy A.K. Ray, National Metallurgical Laboratory (CSIR), Jamshedpur, India, B. Goswami, R.V.S. College of Engineering and Technology, Jamshedpur, India, S.B. Kumar, National Institute of Foundry and Forge Technology, Ranchi., India, D. Das, Metallurgical and Material Engineering Department, Jadavpur University, Kolkata, India, S.K. Das, National Metallurgical Laboratory (CSIR), Jamshedpur, India, A. Sharma, National Metallurgical Laboratory (CSIR), Jamshedpur, India, and D.K. Das, Defence Metallurgical Research Laboratory, Hyderabad, India The life of thermal barrier coating prior to spallation is dominated by micro-cracking in both the thermally grown oxide and the yttria stabilized zirconia top coat. It was observed that the coated materials had higher endurance limits than the bare superalloy and the premature failure for these two materials is possibly due to high stress crack nucleation and growth in the TBC/bond coat layers. Oxidation is also the cause of the reduced life of the bare substrate as compared to the coated substrate while fatigue testing is carried out in an oxidizing environment. Spallation of the ceramic layer was evident at very high fatigue stress and also at low fatigue stress where the TBC composite specimen failed after 5,400,107 cycles during fatigue testing at 800°C in air due to a continuous alumina scale growth (thickness >3 mm) at the bond coat/TBC (top coat) interface.

Excerpts taken from abstracts in CMQ, Vol. 47, No. 1.

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September/October 2008 | 124

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voices from industry

Mining demographics

by Boyd Payne, president and CEO, Elk Valley Coal Corporation

t is no stretch to say that our sector’s prosperity will depend on how we adapt to our country’s changing demographics over the next two decades. It is also not far-reaching to predict that within any sector, it will become increasingly difficult to find skilled workers. Why? Let’s step back a few years.

When I was born in 1949 in Coleman, Alberta, Canada had, on average, 28 births per 1,000 people. Today, that figure has decreased to just 11 births. Quite a significant change.

I am of the baby boom generation – a group of close to nine million Canadians born between 1946 and 1964. Over our lifetimes, we have driven the economy and shaped economic forces such as interest rates, the markets, housing and labour patterns. We have been fortunate to redefine, by the sheer force of our numbers, each phase of our lives, and in the process we have transformed society.

Canada now has the highest percentage of boomers in its total population – even more than Australia, Britain and the United States.

Approximately 15 per cent of Canadian workers are 55 and over and, for the first time, half are over 40 years old. To put this in context, approximately 800 Canadians will retire every day during the next 15 years. And as we approach retirement, it is important to many of us to give back.

In order to give back, it’s important that we boomers in key decision-making positions understand the trends within our industry. Traditionally, the assets of mining companies were thought to be their tangibles, such as trucks and shovels. But today, we know that our people are our most important asset.

In the emerging economies of China, India, Russia and Brazil, the demand for raw materials has grown dramatically, driven primarily by rapid industrialization and economic development. Two developments can help put things in context. The first is that China and India urbanize the equivalent of Canada’s population every year. This means that more than 35 million people leave rural environments for urban settings. Urbanization needs steel, and steel requires our coal.

The second development comes from Russia.

The Moscow Times reported in July 2008 that due to rapid economic expansion, $570 billion dollars

I

126 | CIM Magazine | Vol. 3, No. 6

worth of infrastructure projects are in the works.

This is great news for an economy that for over six decades was centrally planned. However, in its rapid transition to a market economy, Russia has become a magnet for illegal workers, whose services it needs to sustain its growth.

Now, let’s refocus on the employment situation in Canada. What can our industry do to remain competitive and attract the most highly trained, experienced and knowledgeable workers?

A key starting point is the necessity to embrace change, to courageously accept new realities, to think outside the box and to realize that the status quo is a recipe for failure.

Thirty-five years ago when I entered this industry, very little attention was paid to employees. Today, they are our best ambassadors. As such, at Elk Valley Coal we encourage everyone to communicate openly and transparently, fostering a mentoring environment of trust and an atmosphere free from power struggles, politics or organizational divisions. We have embarked on a path to ensure that our employees and those who want to be part of our team in the future understand that they are our most important asset. They are the leaders of tomorrow and need to fully embrace the vision and mission of the company.

Our initiative is called “One Purpose, One Plan, One Team.”

One Purpose signifies creating a meaningful vision that permeates to every employee. In concrete terms, it translates into the capacity to lead and control our own destiny.

One Plan signifies the strength to create an open environment that encourages the flow of ideas and the sharing of knowledge to fulfill our vision.

One Team signifies breaking away from the antiquated notion that good ideas are correlated to hierarchy. We foster a positive and rewarding work environment, giving praise when it is deserved while providing honest, constructive feedback.

These changes are not embraced overnight.

But maintaining the status quo is simply not an option. The world is changing and we must adapt to succeed. Significant opportunities await those ready to keep up with the pace of change. At Elk Valley Coal, we are change agents focused on improving the future of our industry. CIM