CIM Magazine November 2009 by CIM-ICM Publications

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CONTENTS CIM MAGAZINE | NOVEMBER/NOVEMBRE 2009

NEWS 11

Inspection blitz Ontario focused on improving

A meeting of mines Investors meet to

electrical safety in the mining industry by J. Borsato

survey the mining market at the Toronto Resources Investment Conference by J. Borsato Building capacity Sudbury technology and innovation centre NORCAT continues to grow by R. Bergen

Grande succès pour la grande seduction Le Nord-du-Québec est parti à la conquête

Resounding success for “la grande seduction” Hundreds of applicants attracted by

de 1 000 travailleurs par R. Pillo

Quebec campaign to meet the labour demand in James Bay

Cost containment a rising risk for mining companies A report by Ernst & Young offers new appraisal of mining sector risks to match the new economic reality by P. Diekmeyer

24 UPFRONT 20

“I Am Responsible” IAMGOLD Corporation cultivates its own sustainability framework

Turning a liability into an asset

by D. Zlotnikov

Vancouver environmental firm BioteQ the source of innovative water treatment for waste water and acid mine drainage by R. Bergen Ecology and economics The emerging technical, environmental and economic challenges confronting the nickel and base metal industries by A.D. Dalvi Building on a strong foundation Q & A with Ontario Mining Association president Chris Hodgson by P. Diekmeyer

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COLUMNS 55 56 58 59 60 61 62 65 66 68 70 71 72 73 98

Supply Side by J. Baird Eye on Business by N. Smitheman and T. Pratt MAC Economic Commentary by P. Stothart Women in Mining by R. Andrews HR Outlook by S. Polowin First Nations by J.C. Reyes Innovation by A. Blancarte Parlons-en par R. Giguère Safety by R. Bergen Engineering Exchange by H. Ednie Standards by D. McCombe and C. Waldie Student Life by M. Condra Canadians Abroad by R. Bergen Mining Lore by R. Bergen Voices from Industry by M. Gravelle

CIM NEWS 76

Friendly fire in Fort McMurray Paintball tournament marks the end of students’ summer in Alberta’s oil patch by C. West

76 77

32 MINING IN ONTARIO

L’INDUSTRIE MINIÈRE EN ONTARIO 32 38 40 42 46

The school of hard rocks Operators and insiders discuss lessons learned and future prospects for Northern Ontario by R. Bergen Looking north for prosperity A century on, the gold fields of Northern Ontario continue to fuel growth by B. O’Hara Taking diamonds from mine to market Ontario Diamond Sector Unit aims to extend the province’s reach within the industry by M. Eisner Keeping the engine going Fine-tuning the key to the specialized players of Sudbury’s service and supply sector by M. Eisner

79 80

Mentoring the next generation of industry leadersThe Sudbury Branch keeps its eyes on the

Deep-sea voice CIM Distinguished Lecturer Steven

42nd Annual Canadian Mineral Processors Operators’ Conference preliminary program

horizon, supporting today’s students by A. Tonnos

L’expérience est la clé de la croissance dans le Nord de l’Ontario

Scott discusses seafloor massive sulphide deposits by R. Pillo

42e Conférence annuelle des minéralurgistes du Canada programme préliminaire

MINE EN VEDETTE Cooperation key Pressing on through crests and troughs, Xstrata’s Nickel Rim South project approaches completion by D. Zlotnikov

par L. Blais-Leroux

Another successful Géogolf tournament Keeping spirits high Samantha Espley earns CIM Distinguished Service Medal with leadership and pioneer spirit by R. Pillo From point B to point B Art and Science attract New Brunswick members to annual convention in Beresford and Bathurst by B. Rose Northern branch back in action The Yellowknife Branch celebrates its renaissance by J. Heimbach Golf anyone? The Northern Gateway Branch members hit the links by R. Slack Developing excellence Maintenance engineers and mine operators converge on Sudbury to share best practices and good times by M. Moore

FEATURED MINE 48

Géogolf 2009 un success

HISTORY

La cooperation constitue la clé Le projet Nickel Rim South de Xstrata presque prêt

88 91

Porphyry Deposits (Part 2) by R.J. Cathro The beginnings of mineral processing research in Canada (Part 1) by F. Habashi

TECHNICAL SECTION 93

This month’s contents

IN EVERY ISSUE 6 8 10 74 77 83 97

Editor’s Letter President’s Notes | Mot du président Letters Welcoming new members Obituaries Calendar Professional Directory November 2009 | 5

editor’s letter The many facets of Ontario mining “Learn the past, watch the present, and create the future.” ~ anonymous ntario has been one of the world’s foremost mineral producers for over a century. And yet, as far as editorial themes go, “Mining in Ontario” is a challenging one. The geographical area may be clearly defined, but the nature of the mining industry in the vast province defies any neat summary. Ontario is the repository for more than 30 different metal and nonmetal mineral products, including gold, nickel, copper, zinc, platinum, palladium, cobalt, silver and diamonds. Each of these commodities represents an industry in its own right, with unique challenges and market sensitivities. Despite these many different threads, as the stories were filed and the editorial unfolded, it became apparent that there were indeed some common patterns shared by these industries that help explain mining’s longevity and success in the province. Among these templates is a strong connection to the past and its hard-won lessons. This firm footing is balanced by the imperative to remain sharp-eyed and agile, aware of the opportunities afforded by innovation and ingenuity. Base metals were hit particularly hard by the recession. However, operators and suppliers in the Nickel Belt have responded by channelling the resilience born of a mining legacy that spans more than 100 years. Shafts are being sunk deeper, mills and refineries are becoming more efficient and equipment is being adapted and improved, all in an effort to weather the latest in a long history of market fluctuations. The luster of gold — an industry “old-timer” — is as bright as ever. However, a century later, Ontario gold miners and developers continue to polish how they extract it, utilizing revolutionary drilling methods to increase current and future gold production. Even the relative new kid on the commodity block, the province’s flourishing diamond industry, is drawing upon the experiences of industry counterparts in the Northwest Territories to find creative new ways to reap more rewards from the global diamond pipeline. Despite the many and disparate stories in the chronicle of Ontario mining, the bedrock of this stalwart industry endures: show respect for those who came before, learn from one another now for the benefit of all, and always keep that prospector’s eye trained on the possibilities of tomorrow.

Angela Hamlyn Editor-in-chief We’d love to hear from you! Send your feedback and suggestions to

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Editor-in-chief Angela Hamlyn editor@cim.org Section Editors News, Upfront and Features: Ryan Bergen rbergen@cim.org Columns, CIM News, Histories and Technical Section: Andrea Nichiporuk anichiporuk@cim.org Technical Editor Joan Tomiuk jtomiuk@cim.org Publisher CIM Contributors Richard Andrews, Jon Baird, Louise BlaisLeroux, Alicia Blancarte, Jeff Borsato, R.J. Cathro, Michan Condra, Ashok Dalvi, Peter Diekmeyer, Heather Ednie, Marlene Eisner, Robert Giguère, Michael Gravelle, Fathi Habashi, Joe Heimbach, Deborah McCombe, Marlene Moore, Brian O'Hara, Robbie Pillo, Sheldon Polowin, Tracy Pratt, Juan Carlos Reyes, Barbara Rose, Roy Slack, Neal Smitheman, Paul Stothart, Adam Tonnos, Craig Waldie, Christian West, 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 ($150.00); Non-members (Canada), $168.00/yr (GST included; Quebec residents add $12.60 PST; NB, NF and NS residents add $20.80 HST); U.S. and other countries, US$180.00/yr; Single copies, $25.00. Advertising Sales Dovetail Communications Inc. 30 East Beaver Creek Rd., Ste. 202 Richmond Hill, Ontario L4B 1J2 Tel.: 905.886.6640; Fax: 905.886.6615 www.dvtail.com National Account Executives 905.886.6641 Joe Crofts jcrofts@dvtail.com ext. 310 Janet Jeffery jjeffery@dvtail.com ext. 329

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

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president’s notes Students – the future of our industry and our Institute This month, I want to talk about a subject that is near and dear to me: what CIM is doing — or not doing — for students in Canada’s mining industry. You may have heard me before, in this space or elsewhere, discussing the necessity of bringing new and younger members into the CIM fraternity. My own involvement with CIM began in university when one of my professors showed up with a handful of application forms and said: “Everybody fill one of these out; you’re all joining CIM.” Although this approach might have lacked some subtlety, I do believe that every geology, mining, mineral processing and metallurgy student across Canada should be a CIM student member as a matter of course. Mining students need to feel a part of the industry in which they will work, and CIM provides the ideal means for fostering that connection. Most CIM branches that are in close proximity to a university or college do their best to involve students in their activities by inviting them to branch meetings, hosting student mixers and offering scholarships. In spite of these efforts, I feel that we are still not connecting with them adequately. To encourage student involvement, about a year ago Council changed the fee structure so that CIM membership is free to students registered in a full-time program in mining,

geology, mineral processing or metallurgical studies. In spite of this, a majority of students in these disciplines have still not signed up. In an effort to change this, CIM Council recently authorized the hiring of a new membership liaison coordinator, Teresa Barrett. One of Teresa's first priorities will be contacting every university to discuss the benefits of CIM membership, informing students about how they can become members, and helping to establish student branches. I call on all of our members to support and encourage Teresa in her endeavours. Students represent the future of CIM and of our industry. Let’s all do our part to make it happen.

Michael J. Allan CIM President

Les étudiants – l’avenir de notre institut et de l’industrie Ce mois-ci, j’aimerais vous parler d’un sujet qui me tient à cœur : ce que l’ICM fait — ou ne fait pas — pour les étudiants de l’industrie minière au Canada. Vous m’avez peutêtre déjà entendu, ici ou ailleurs, parler de la nécessité d’attirer de nouveaux membres, plus jeunes, dans l’association de l’ICM. J’ai moi-même commencé à participer à l’ICM alors que j’étais à l’université, lorsque l’un de nos professeurs est arrivé avec une poignée de formulaires de demande d’adhésion et nous a déclaré : « Chacun d’entre vous remplit un formulaire; vous adhérez tous à l’ICM. » Cette approche manquait peutêtre de subtilité, mais je crois en fait que chaque étudiant en géologie, en exploitation minière, en traitement du minerai et en métallurgie du Canada devrait être un étudiant membre de l’ICM. Les étudiants en exploitation minière ont besoin de sentir qu’ils appartiennent à l’industrie dans laquelle ils travailleront. L’ICM leur offre le moyen idéal de renforcer ce lien. La plupart des bureaux de l’ICM qui se trouvent à proximité d’une université ou d’un collège font de leur mieux pour faire participer les étudiants à leurs activités en les invitant à leurs réunions, en organisant des rencontres d’étudiants et en proposant des bourses d’études. Malgré ces efforts, je pense que nous n’établissons pas de liens suffisants avec eux.

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Il y a un an, dans le but d’encourager la participation des étudiants, le conseil a modifié le barème des cotisations d’adhésion à l’ICM afin que celle-ci soit gratuite pour les étudiants inscrits à temps plein dans un programme d’études en exploitation minière, en géologie, en traitement du minerai ou en métallurgie. Pourtant, la plupart des étudiants inscrits dans ces disciplines n’ont pas encore adhéré à l’ICM. Dans le cadre des efforts déployés pour changer cette situation, le conseil de l’ICM a récemment autorisé l’embauche d’une coordonnatrice chargée des relations avec les nouveaux membres, Teresa Barrett. L’une des priorités de Mme Barrett consistera à prendre contact avec chaque université pour discuter des avantages d’adhérer à l’ICM, informer les étudiants sur la façon de devenir membre et les aider à établir de nouveaux bureaux d’étudiants. Je demande à tous nos membres d’appuyer et d’encourager Mme Barrett dans cette entreprise. Les étudiants représentent l’avenir de l’ICM et de notre industrie. Faisons tous en sorte de réussir.

Michael J. Allan Président de l’ICM

letters The â&#x20AC;&#x153;writeâ&#x20AC;? stuff On behalf of RioTinto, I would like to express our gratitude for the wonderful job done by Ms. Marlene Eisner reporting on the Diavik Aboriginal Leadership Development Program in the August issue of your magazine (CIM Magazine, August 2009, p. 35). The writing was very well done, accurately portraying the program and, in our view, represents some of the best writing we have seen in some time on the topic of the Diavik Leadership Development Program. This article has been circulated around to all of our grads and has generated some great discussion from other companies and governments which, I am confident, will help to bring this story and the development of Aboriginal employees forward. Regards, John Tees Advisor, Community Affairs Diavik Diamond Mines Inc.

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news

Inspection blitz Electrical safety in the mining industry By Jeff Borsato The “Safe at Work Ontario” strategy is a new approach to workplace health and safety that builds on the Ontario Ministry of Labour’s “targeted intervention” strategy which, since 2004, has addressed safety issues for the province’s employers and workers. Launched in 2008, Safe at Work Ontario seeks to foster a strong health and safety culture in workplaces through a mix of education, training and enforcement of provincial legislation. It carries out sector and hazard-specific inspection blitzes throughout the year in the hopes of reducing lost time injury claims and occupational hazards. In September 2009, the Ontario Ministry of Labour dispatched teams of inspectors to ensure electrical safety within the mining industry, targeting employers known for poor regulatory compliance or that possess the most potentially hazardous equipment and processing facilities. As Canada’s largest mineral producer, Ontario must remain a model of efficient and safe mining practice. Ontario Minister of Labour Peter Fonseca was on hand at the Sifto Salt Mine in Goderich, Ontario, to announce the safety blitz this past summer. Because of its exemplary safety record, Sifto Salt was chosen by the Ministry as the location to announce the new spotlight on electrical safety in mining operations. Last year, Ontario’s 430 full-time occupational health and safety inspectors focused on other areas during

similar blitzes, including construction as well new and young workers. Since 2004, the Ministry of Labour has claimed to have lowered lost time injuries in all industries by 20 per cent. Since 2000, over 70 workplace fatalities were the result of electrocution. During the month of September, inspectors were tasked with examining electrical equipment and safety practices at underground mines, surface plants and mixed-use aggregate operations across Ontario. The Electrical Safety Authority, a Sudburybased mining safety group, notes that electrical systems have evolved rapidly as the backbone of mining operations, but that electrical risk management has failed to keep pace. Many problems stem from poor safety awareness and injury procedures on the part of

personnel. What is required, they say, are qualified engineering and electrical staff who possess a working understanding of applicable standards and regulations, equipment, and possible deficiencies that might exist in mining operations. Contraventions found under the Occupational Health and Safety Act and its regulations could result in a fine of up to $500,000 to corporations and $25,000 or incarceration for up to 12 months for individuals. Mine safety is a critical part of the industry, and such safety blitzes are part of ongoing efforts to ensure Ontario mines and mining operators remain at the forefront in injury prevention. CIM For more information go to www.news.ontario.ca.

mac facts

According to Natural Resources Canada, the value of mineral production in Ontario was approximately $9.6 million in 2008.

November 2009 | 11

news A meeting of mines The Toronto Resources Investment Conference By Jeff Borsato While deflation and inflation assume top billing in the financial media, it is easy to overlook the broader issues that affect precious and base metal mining; namely the financing and labour expertise required to fuel an ever-growing demand for new discoveries. With mining at the forefront of environmental efforts to manage large-scale projects while respecting local ecology, it is increasingly important to evaluate the business of mineral exploration and production as more than just a reflection of the price of the underlying asset. The 2009 Toronto Resource Investment Conference (TRIC) that took place at the end of September

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brought together an extensive lineup of junior mining and exploration outfits representing the broad spectrum of precious, base and rare earth metals. Held at the Toronto Convention Centre, it was hosted by resources investment conference organizer Cambridge House. Over 150 companies were on display alongside an assembly of industry analysts and mining experts of all stripes who gathered to discuss the fundamentals of mining-related investments over the course of the weekend. Paul van Eeden of Cranberry Capital imparted his thoughts on some of the biggest challenges facing junior exploration and mining. “Raising capital will be their

biggest hurdle going forward,” said Van Eeden. “In the event of another round of risk aversion in capital markets, mining companies — particularly those with smaller market capitalization — will find themselves in a difficult climate.” According to van Eeden, the role of China in metals markets was balanced against popular media claims of stockpiling. “China is interested in purchasing resources, but they are not ‘stockpiling’ as has been suggested, nor would they be able to divest over two trillion in U.S. debt into the relatively small metals markets even if they wanted to,” he said. Asked if he felt speculation was fueling much of the run up in metal prices as of late, van

news Eeden was quick to agree and added that while he was bearish on metals and markets in general, value could still be found in specific equities. Lawrence Roulston, a long-time mining commentator and analyst, attracted a hefty crowd to his Saturday afternoon presentation. Stressing the big picture of mining markets and not the day-to-day gyrations in metals prices, Roulston pointed to the recovery of precious and base metal shares as a demand-driven reality in a globalized economy. Agreeing with van Eeden that Chinese stockpiling is largely a myth, he acknowledged their dominant presence in a host of markets. Citing the rise of domestic demand via increased infrastructure spending and automobile purchases, Roulston pegged China as the single biggest contributor to rising metals prices. Jay Taylor, the author of J Taylor’s Gold, Energy & Tech Stocks newsletter, was available to offer a macro-

economic perspective of gold. Citing the rise of the yellow metal’s purchasing power relative to virtually all other commodities, Taylor pointed to greater prospects of returns in mining stocks than the metals themselves during the current upswing in prices. While gold and silver mining companies took centre stage for much of the talks at TRIC, there were some welcome additions of the lesser known metal miners. With over 90 per cent of laptop batteries featuring lithium ion batteries and an explosion in battery-powered automobiles, the exploration and mining of lithium and other rare earth elements (REE) are critical to future technological innovation and environmental conservation. The largest supplies in the central and southern United States have given way to China as the dominant source for REE discoveries.

Rodinia Minerals is one such supplier of REE, with lithium and uranium projects in Arizona and Utah. With interests in the only active lithium mine in the United States, its Nevada-based Clayton Valley project is of particular interest to those that envision an energy-independent U.S. Energy policy in the United States has emphasized greater independence from Middle East oil. With China considering limiting REE exports, domestic production is all the more critical. There was no shortage of Africanbased exploration and mining companies at this year’s TRIC. Hosting approximately 30 per cent of the planet’s mineral reserves of precious metals, Africa also continues to be a major producer of a wide variety of base metals. Much of the mineral exploration within Africa has focused on gold and diamonds, but the rise in base-metal prices has

November 2009 | 13

news allowed for an increase in new projects across the continent. A host of new mines and exploration projects have been fueling a mining boom in spite of regional instability and geopolitical concerns. Richard Buzbuzian of Zimbabwebased New Dawn Mining Corp. was on hand at the conference to highlight the benefits of mining in a nation known more for its runaway inflation than for its geo-strategic gold mines. New Dawn’s main projects are its Turk and Angelus mines in the resource-rich Bulawayo-Bubi Greenstone Belt. Providing at times up to 50 per cent of Zimbabwe’s earnings, gold mining languished for over a decade before the Zimbabwe Mines and Minerals Act (MMA) and deregulation of exchange control policies began, allowing producers to sell gold directly to foreign buyers in the currency of their choice. Buzbuzian highlighted that currency risks were among the chief concerns to most

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investors and, in spite of domestic inflation, currency risk has been effectively removed by sales of gold in U.S. dollars. While South Africa, Tanzania and the Democratic Republic of Congo dominate the African mining industry, other states have begun to attract the attention and funding needed to explore new opportunities. One such mining company was Riverstone Resources. Based in Burkina Faso, Riverstone has exploration projects in a lesser known mining nation on the western edge of the African continent. The standout Karma project consists of four contiguous permits in the Birimian Greenstone Belts that cover large swaths of Burkina Faso’s resource-rich regions. In the early part of the decade, TRIC was smaller and hosted a variety of small cap tech companies alongside exploration and mining names. The run up in metals prices, even in spite of last years credit

crisis, has seen a return to the core components of resource investments: precious and base metals, REE and a host of exploration projects around the globe. The all too familiar “perma-bull” outlook that once pervaded the floor of many mining conferences was replaced by a range of opinions offering bull and bear scenarios for the metals. Labour, energy costs, environmental impacts and displacement of local inhabitants require more than just picks and shovels to succeed. Canada is a leader in the mining world and possesses a rich history of innovation. As we continue to leverage our strengths in the field, we are reminded of the complexities of creating wealth from hard assets. The TRIC was an exciting reminder of Canada’s pivotal place in the mining world, but also of the magnitude of ongoing efforts to explore and extract mineral wealth around the globe. CIM

news Building capacity Growth spurt for Sudbury tech centre By Ryan Bergen The Northern Centre for Advanced Technology (NORCAT) added a little icing to its cake this fall. Even before the centre had the chance to celebrate the grand opening of its new 60,000-square-foot Innovation and Commercialization Centre, it had its coffers topped up another million dollars by the Northern Ontario Heritage Fund Corporation (NOHFC) to expand even further. With its modern industrial labs and office space, NORCAT’s Innovation and Commercialization Centre is designed to enable businesses and entrepreneurs to develop technology and try out new ideas. Also housed under its roof are services and facilities for environmental and occupational health and safety training and consulting, contractor orientation, industrial shops, and a media production house. Offsite, the organization has an operating mine where innovations can be demonstrated and applied. The $10.6 million cost of the expansion was covered by the federal regional development organization in Ontario (FedNor), Vale Inco, NOHFC, Xstrata, Cambrian College, FNX Mining, Greater Sudbury Utilities and the City of Greater Sudbury. The latest funds from the province will go towards adding more space to house companies that require private, secured space in which to work on bringing new technologies to market, says the company’s CEO Darryl Lake. He started NORCAT in 1995 in the basement of Cambrian College where he was the Dean of Health Sciences, Trades and Technology. “Our prime focus is to create jobs for young people,” explains Lake, who says he watched too many of them leave the area looking for opportunity elsewhere. The label of

“young” is applied generously, he concedes, but he credits NORCAT with creating over a thousand jobs in the Sudbury area. “There have been 41 companies that we have helped get started,” Lake says, adding that the demand for space has always outpaced supply. “That shows you how vibrant the industry is even in the toughest of tough times.” Though the collection of enterprises that use the resources at NORCAT has diversified since its founding, the core focus for most residents renting space is mining. “Out of the 14 occupants here, we have a couple of startups, the others are companies that want to innovate or are changing or improving their product lines to take them global, for example.” The next phase of expansion will provide another three businesses with shop space. NORCAT helps alleviate some of the financial risk from new project development by providing the launch pad for those who need to rent additional space dedicated to innovation,

but who do not want to get locked into long-term leases. One aim, explains Lake, is to ease the entry of companies from outside of Sudbury that want to penetrate the local markets. Early on, Lake says he made sure local real estate brokers and owners understood that the model created a win-win situation. “We explained that what we are trying to do is get companies to innovate and remain stable so they can rent more space. The minute our residents are ready to get into manufacturing we have to part ways.” That moment can be bittersweet, admits Lake. Of the roughly 100 people working at NORCAT, half are permanent employees and half temporary residents. “It’s a family effort here so when one of our residents ‘grows up’ and wants to leave, we all feel terrible.” The difference now, though, is that the young talent is simply moving out, not moving away. CIM www.norcat.org

November 2009 | 15

news Grand succès pour la grande séduction Le Nord-du-Québec est parti à la conquête de 1 000 travailleurs Par Robbie Pillo

Resounding success for “la grande séduction” 1,000 workers needed in James Bay

Le 7 octobre dernier marquait la fin d’une vaste campagne de recrutement visant à contrer la pénurie de la main d’œuvre dans le secteur minier de la région de la Baie James au nord du Québec. Du 15 septembre, la caravane « La ruée vers le nord », mise sur pied par le Comité action mines (CAM), a parcouru une quinzaine de municipalités à travers le Québec afin d’attirer plus de 1 000 travailleurs d’ici 5 ans dans la région de la Jamésie. Au cours de leur voyage, les animateurs de la caravane ont rencontrés plus de 2 000 visiteurs, offrant de l’information sur la région et les possibilités de carrières dans le secteur minier. « Les besoins se situent à tous les niveaux », précise Alain Poirier, président du CAM. En plus de la caravane, le CAM a également développé un site internet où on peut retrouver de l’information sur les attraits de la région, une image de l’industrie et les emplois disponibles dans ce secteur. Plus de 15 000 visites ont été recensées sur le site et près de 600 personnes ont déposées leur candidature dans l’outil Placement en ligne d’Emploi Québec. L’industrie minière dans cette région est en pleine expansion. « Nous comptons actuellement six mines en activité, une dizaine de projets de mise en valeur, près de 250 projets d’exploration. Le Nord-du-Québec vit aussi une vraie ruée vers l’or depuis la découverte du gisement Éléonore en 2001 développé aujourd’hui par les Mines Opinaca ltée (Goldcorp) », explique M. Poirier. M. Poirier s’enthousiasme devant le succès de la campagne. « Tous ces efforts ont déjà porté fruit car des sociétés minières ont déjà eu la chance de recruter des employés de grande qualité, pour des postes de technicien minier.» ICM

A vast recruiting campaign aimed at offsetting the mining industry’s lack of manpower in the James Bay Region in northern Quebec successfully attracted nearly 600 applicants. The “Lure of the North” campaign caravan, organized by the Comité action mines (CAM), travelled to 15 municipalities throughout Quebec over three weeks in September and October in an effort to attract more than 1,000 workers to the James Bay region in the next five years. “Skilled trade workers and professionals are needed in every sphere of activity,” says Alain Poirier, president of CAM. Throughout their journey, CAM representatives met with more than 2,000 visitors and provided information about the region as well as career opportunities available in the industry. In addition to the campaign caravan, CAM also created a website informing the public about the region’s attractions, including an overview of the mining industry and its employment possibilities. The website recorded more than 15,000 visits. As well, visitors were able to post their applications through Emploi Quebec’s online placement tool. The campaign’s resounding success has left Poirier feeling confident. “Our efforts have started to bear fruit,” he says. “Mining companies were able to recruit high-quality employees for technician positions.” This is good news because the region’s mining industry is expanding. “We currently have six active mines, about ten projects in development and almost 250 exploration projects,” says Poirier. “Northern Quebec is experiencing a real ‘gold rush’ since the discovery of Éléonore in 2001, which is now being developed by Goldcorp.” CIM

www.larueeverslenord.com

De gauche à droite : Alain Poirier, président du Comité action mines, François Gadbois, comédien et porteparole et Luc Letendre, coordonnateur de la tournée. From left to right: Alain Poirier, President, Comité Action Mines, François Gadbois, actor and spokesperson, and Luc Letendre, tour coordinator

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news Cost containment a rising risk for mining companies A report by Ernst & Young says that the financial crisis and global recession have changed the environment that Canadian players face By Peter Diekmeyer The global financial crisis created or exacerbated risks that threatened the near-term survival of a number of mining and metal companies. However, opportunities have also emerged for well-capitalized companies to position themselves for the upturn. Those are key conclusions of Ernst & Young’s Strategic Business Risk Report 2009 released in August. The report notes some of the major changes that have beset the industry. It also highlights risks that mining sector players face and assesses how those risks have evolved during the past 12 months. Not surprisingly, the 40 per cent drop in the London Metal Exchange Index that occurred between July 1, 2008 and July 1, 2009, has made things much tougher says Tom Whelan, Ernst & Young’s Canadian leader for the mining and metal industry. “Access to capital has been choked off for most companies, with the rare exception of those in the gold sector and maybe a few others,” he says.

The Ernst & Young report recommends several steps that mining and metals companies can take to respond to cost containment risks. These include focusing on areas that

Tightening the purse strings The upshot is that producers are now increasingly focused on cost containment, which the Ernst & Young report lists as the biggest risk that the sector faces. “We went through a period during which commodity prices rose rapidly to unprecedented levels,” says Whelan. The desire by operators to produce and sell as much product as possible while the prices were so good led to bottlenecks in the supply chain for basic inputs ranging from skilled labour to energy and delivery infrastructure. “This ‘produce at all costs’ mentality led to sloppiness and cost overruns, which are totally unsustainable at current price levels,” says Whelan. Many mines responded to the drop in commodity prices by shutting down production. However, others that continue to produce will need to get their costs back into line. The key, says Whelan, is that cost reduction activities need to be implemented in a way that does not lead to value erosion. November 2009 | 17

news provide maximum value, embedding cost optimization to make sure that the savings achieved are sustainable, and ensuring that company leadership is visibly committed to achieving a single definition of success.

The top 10

Some risks have decreased… temporarily

that mining sector players face

Of course not all risks have increased. In fact, slowdowns or shutdowns at many mines, sparked by shrinking demand, have given companies slack in several areas once judged far more critical. For example, skills shortages, once a major threat due to the rising average age of workers in several key job categories, are not as prevalent as they once were. In a similar vein, reduced or halted production by many operators has meant that a lot of those mines will be around longer. That means that pipeline shrinkage is less of a concern. Getting access to scarce infrastructure is also easier now. Reduced demand has also weakened the hand of many countries and regions that were seeking to attract investors willing to develop local deposits. As a result, resource nationalism and the ability of miners to obtain or maintain social licenses to operate no longer provide the same “bargaining chip” incentives they once did. “The discussion of risks as required in the management discussion and analysis (MD&A) tends to be generic and typically does not provide a detailed description of the likelihood of the risk occurring or the magnitude of the impact,” says Whelan.

(according to Ernst & Young):

strategic risks • • • •

Cost containment Industry consolidation Access to capital Maintaining a social license to operate • Climate change concerns

He counsels clients not to succumb to the pressure to cut spending on initiatives to build bridges with local communities where mines operate.

Much discussed, not always fully reported Reports like the Ernst & Young document provide particularly useful information for mining sector stakeholders. The long life cycles inherent in almost all mining projects means that correct risk profile assessments of current and planned initiatives are crucial. “At the end of the day, the mining industry is full of risks,” says Whelan. “[As a result] risk management is one the top topics of conversation at board levels.” Despite this, Whelan points out that risk reporting is not formally mandated under current accounting guidelines. “The MD&A sections of company financial statements do include a risk section. But the information there is kept fairly generic,” says Whelan. The upshot is that to fully assess the risk that the mining industry operates under, stakeholders will generally have to do research of their own. Whelan also made interesting observations regarding the effects that consolidation has had on the industry. “Our research shows that companies that are emerging out of the crisis fall into three categories. They are either opportunists, innovators or survivors,” says Whelan. The key, says the mining sector expert, is to stay focused on the big picture. “Tougher access to financing means that the short-term investment picture may indeed look grim,” says Whelan. “The IPO market has essentially been closed down. As a result, we are telling our clients that if they have a chance to get a hold of capital, they should seize it.” The tough times, however, are not expected to last forever. “The demand for resources will rebound,” says Whelan. “Lack of available financing has created fabulous opportunities for those who have a longer term horizon such as the Chinese companies who recently took positions in Consolidated Thompson Iron and Teck Resources.” CIM www.ey.com/ca

18 | CIM Magazine | Vol. 4, No. 7

• Skills shortages • Infrastructure access • Access to secure energy • Resource nationalism • Pipeline shrinkage

upfront SUSTAINABILIT Y by Dan Zlotnikov

“I Am Responsible” Photo courtesy of IAMGOLD Corporation

IAMGOLD Corporation creates a tailor-made sustainability framework

In Suriname, Rosebel’s mining team is proud of its excellent safety performance record.

hen Ross Gallinger joined IAMGOLD in May of 2006, the company was in the midst of a massive transformation. Until that year, it was involved in the gold mining industry exclusively as an investing partner. But in March 2006, the company finalized the acquisition of Gallery Gold, along with the latter’s producing Mupane gold mine, near Francistown in eastern Botswana. Moving from investment concern to mine operator would necessitate significant strategic and planning changes, which the IAMGOLD management team recognized. One of the major areas in need of attention was going to be the trifecta of health, safety and sustainability. It is with these changes in mind that the company hired Gallinger, who had most recently held the position of vicepresident of sustainability with Placer Dome. But Mupane was only the beginning. In early November of the same year, IAMGOLD acquired a second producer, Cambior. This gave the company control over two more operating mines, Doyon and Mouska — both located in gold-rich Val-d’Or in northwestern Quebec.

20 | CIM Magazine | Vol. 4, No. 7

“Suddenly the company became a full-on mid-tier production company,” explains Gallinger, who was tasked with developing a comprehensive set of policies and plans covering sustainability. “We went from being a very small joint venture to being the tenth largest gold company.” The organization’s rapid growth presented an opportunity to evaluate its entire setup and develop a structure that would be an optimal fit for the company’s long-term goals, without being excessively constrained by existing, and potentially insufficient, frameworks. “What management had was desires, especially our president and CEO, Joe Conway,” Gallinger recalls. “Joe said, ‘we really need to chart a course; I have some experience around it but we need to get somebody who has the expertise to do this, so we’re not reinventing the wheel. Let’s go find someone who could help us on that part.’” Gallinger is quick to point out, however, that safety and sustainability practices were certainly not lacking when he came on board. “IAMGOLD has always traditionally been heavy on the exploration side,” he explains. “Visiting the sites, I was very pleased to see that positive practices regarding community and the environment were well embedded. The Quimsacocha project was a great example of that. They had a community team in place and a great environmental program for reclaiming drill pads. I’ve never seen an exploration site run so well from an environmental sustainability point of view.” What was needed, Gallinger explains, was a support system for the practitioners already implementing these initiatives on the ground. With both practitioners and management receptive to the need for a coherent policy, Gallinger and his team were able to draw extensively on the expertise of both groups. To start the process, the team looked at existing

upfront SUSTAINABILIT Y

sustainability frameworks, but none fit the bill. â&#x20AC;&#x153;So we looked at developing our own framework that would include all the things that we see as necessary in sustainability,â&#x20AC;? says Gallinger. It includes six elements: leadership and accountability; stakeholder engagement; change management, risk management and emergency preparedness; environmental stewardship; social stewardship; and governance. The company also incorporated successful practices from its newly acquired assets. For example, Cambior was ISO 14001-certified and so IAMGOLD incorporated it into the framework; it is now the method used to fulfil the environmental stewardship component.

How do you eat an elephant?

SPECIALIZING IN

According to an oft-quoted African proverb, you eat an elephant one bite at a time. This is one of the reasons that the IAMGOLD sustainability framework is not a set of fixed rules. Tackling all of the areas that need improvement at once, says Gallinger, would be far less fruitful than focusing on a single area, bringing it up to the desired level, and then maintaining it while shifting focus to the next one. â&#x20AC;&#x153;To start off with, you canâ&#x20AC;&#x2122;t do 50 things really well; you have to do the ones that are most important to you,â&#x20AC;?

he says. â&#x20AC;&#x153;We donâ&#x20AC;&#x2122;t expect that people go for the low hanging fruit. We want them to work on the things that are really going to manage the risk and provide valuable outcomes at the sites. Everything is equally important, but you have to really look at what the needs are in the area and go that route.â&#x20AC;? One challenge in developing the framework was finding the right metric by which to measure success. The development of this metric, against which IAMGOLD evaluates all its sustainability efforts, is an achievement in and of itself, and one Gallinger is very happy with. â&#x20AC;&#x153;For example, last year we challenged our executives to come up with a core vision describing where we want to be on health, safety and sustainability going forward,â&#x20AC;? he explains. â&#x20AC;&#x153;You can actually put some numbers on the safety side, but when you start talking about the environment and community, it gets bogged down in technical aspects.â&#x20AC;? To address this, the company turned to the concept of â&#x20AC;&#x153;zero harmâ&#x20AC;? â&#x20AC;&#x201D; one that Gallinger acknowledges is not unique to IAMGOLD. â&#x20AC;&#x153;A lot of people utilize zero harm, including Petro-Canada and BHP Billiton, and I have had some experience with it in the past as well. I am really amazed at how people here are grasping the concept and

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November 2009 | 21

really running with it. It’s something that our employees take a lot of pride in discussing.”

Taking responsibility The slogan centres around the concept of “I Am.” The one Gallinger highlights in particular is “I Am Responsible.” In fact, this particular slogan has been accepted to such a degree that workers at one processing plant painted the slogan on the side of a cyanide leach storage tank as a constant reminder to themselves and anyone who visits the site. “We’ve just completed a week-long session at the Rosebel operation. It was very gratifying to get out in front of over 1,200 employees and for me to ask them: ‘So who at Rosebel is responsible for health, safety and sustainability?’ and to hear them respond ‘I am,’ instead of ‘well, it’s the safety guy’s responsibility,’ or, ‘it’s the sustainability guy’s responsibility.’ Instead, they all bought in that ‘I am the guy that’s responsible for these aspects.’” The same concept of personal responsibility is evident in the community initiatives the company funds and supports. One such project was a series of water wells IAMGOLD drilled for villages in Tanzania. Before the first well was drilled, the villagers had to collect 100,000 Tanzanian shillings — roughly $100. Given that Gallinger reveals that the region’s average income is less than a dollar a day, this may make the amount appear unreasonably large. Why would a wealthy multinational company demand payment in the first place for what should have been part of its corporate social responsibility obligation? The reason is simple, explains Gallinger — to give the community a sense of ownership over the well. “It’s basically a commitment,” he explains. “And if raising the hundred dollars was going to be a problem, then we would definitely have helped them. But generally nobody has had any problems raising funds for what they wanted to do.” The villagers also have to pay a fee for use of the well. These are collected in a fund used to maintain the well itself, and the responsibility for maintaining it goes to the villagers. “It was actually a very cool way of setting it up, because it became the communities’ project, not ours,” Gallinger explains. “We didn’t just go out and drill them a well. Then, when it broke, they would have come to us and say, ‘fix your well.’” The personal responsibility approach appears to be working. To date, IAMGOLD has put in nine wells, all of which are still in operation. What’s more, the maintenance funds created with the original 100,000 shillings have since been used to pay for other community initiatives. Gallinger says that the project was very empowering for the villagers. But IAMGOLD is not resting on its laurels. The next stage Gallinger describes involves a long, hard look at the operations — from the outside. The company is in talks 22 | CIM Magazine | Vol. 4, No. 7

upfront Photo courtesy of IAMGOLD Corporation

SUSTAINABILIT Y

with numerous major nongovernmental organizations, which would be able to provide that different point of view. “I can look in the mirror and say that I am a thin guy with a full head of hair, but that’s not exactly what I look like,” says Gallinger. “If you keep looking at yourself in the mirror long enough you can convince yourself of a lot of things. It’s not until somebody looks at you and says ‘no, you’re fat and bald,’ that you’re going to take a step back and say, ‘yes, I think you’re right’; we need to get over ourselves.” There is little doubt that with its focus on personal responsibility and commitment to sustainable principles, IAMGOLD will benefit and grow from these partnerships, and help the local communities grow in turn. And in a few years’ time, someone might look at the community initiatives, or the environmental stewardship projects, and ask “who is responsible for this?” Then Ross Gallinger will be among the over 4,000 employees of IAMGOLD to stand up and say, “I am.” CIM www.iamgold.com

The “Zero Harm” logo has a place throughout the Rosebel operation, from the offices to the mill tanks, as a visual reminder of the ultimate safety objective.

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November 2009 | 23

upfront TECHNOLOGY by Ryan Bergen

Turning a liability into an asset Photo courtesy of BioTeQ Environmental Technologies

Vancouver environmental firm at the source of water treatment advances The ChemSulphide™ Process BioteQ applies its proprietary ChemSulphide™ water treatment technology to recover saleable metals that are otherwise lost through acid mine drainage or during processing. To extract the metals, sulphide is mixed into a tank containing mine drainage or waste from metallurgical processing. The chemical conditions of the sulphide reagent are tuned to target a specific metal in a contactor tank. The soluble metal precipitates, forming solid metal particles. The metal and water are then sent to a clarifying tank where the The Wellington Oro treatment plant behind heaps of dredge rock: a reminder of Breckenridge`s mining past solid is filtered out and condensed. This process, put into operation last year at Jiangxi Copper Company’s Dexing ince last November, a water treatment facility Mine, yielded 120,000 tonnes of copper processed from designed by BioteQ Environmental Technologies and waste and low-grade stockpile drainage. The treatment operated by the Town of Breckenridge in Colorado plant, owned in a joint venture with Jiangxi Copper and has been treating up to 35 cubic metres of contamioperated by BioteQ, sells the recovered copper back to the nated water per hour from the former Wellington Oro mine. company for refining. At a similar operation in Queensland, During that time, the stockpiles of zinc-cadmium concentrate — a byproduct of the treatment process (along with Australia, a series of contactor tanks — each adjusted for a clean water) — has been growing at the treatment plant. Far specific metal — and clarifying tanks together allows the from a nuisance to be rid of, however, creation of the con- reclamation of copper, nickel and cobalt. centrate had been a valuable feature of BioteQ’s design. In Traditionally, lime treatment has been the most widely fact, it had been instrumental in helping the company beat applied approach to cleaning up acid mine drainage. out international competitors for the Environmental Relatively cheap, lime made into slurry, then added to the Protection Agency-vetted contract to provide the technology drainage raises the pH of the water to the point where metto treat the drainage from an old mine a few miles upstream als in it become insoluble, form particles and sink. Over from the mountain resort town. time, innovation has made lime treatment more efficient, This past summer, the Colorado Department of Public but the process inevitably generates metal-heavy sludge that Health and Environment confirmed what BioteQ had always remains an environmental and financial liability. Added is maintained: the contents in the collection of pallets filled the problem that, as the standards for effluent rise, limewith zinc-cadmium sulphide, collecting in the bay of the treated water may not always meet them. The BioteQ plant, was not waste. The high-grade concentrate can, process smooths out both of these wrinkles. instead, be sold to a metal refiner and trucked away to be “Our technology can’t solve all water treatment probturned into anything from batteries to paint. This not only lems,” explains BioteQ CEO Brad Marchant. “We can’t do eliminates the need for sludge-filled catchment ponds and desalination. In some cases a simple lime plant can work the disposal cost when that sludge has to be removed, but just fine.” Those cases, however, will likely become fewer mines value from what once was simply waste. as regulations tighten. For Breckenridge, the mining

24 | CIM Magazine | Vol. 4, No. 7

upfront TECHNOLOGY

Diagram courtesy of BioteQ Environmental Technologies

a host of metals, we’re also taking care of zinc and other trace metals.”

A smoother flow

ChemSulphide™ Process

town-turned-recreational tourism destination, BioteQ’s chemical sulphide plant was the right fit. Breckenridge’s water department operates the plant with the help of BioteQ, whose technical team can monitor all stages of the operating process from its company headquarters in Vancouver. “Putting a lime plant in there would have been a bad idea. It would have created a tremendous amount of sludge with nowhere for it to go,” says Marchant. There is, he says, no typical site where BioteQ simply “cuts and pastes” its technology. Each operation is designed to fit the needs of their customers and settings. “We work at both old and operational sites — base metal mines, gold mines, coal mines, and different geographical and geological settings.”

Xstrata Nickel currently hosts a BioteQ plant at its Raglan Mine in Nunavik to meet the challenge of treating waste water in the Subarctic. Before connecting with BioteQ in 2003, the mine operator, then Falconbridge, used a low-density sludge lime treatment plant to extract nickel solute. The mine now uses both lime treatment and the chemical sulphide process. “The main advantage of the BioteQ process,” says Martin Beausejour, an engineer at the Xstrata mine, “is that it is a continuous treatment and not by batch. We can treat a lot more volume and a lot later into the year. With a batch treatment you have to mix the products in the open pit. Once the recipe is okay, you can treat again, but as soon as you have ice in the pit, there are complications.” With a feeder pipe drawing a constant flow of water, he continues, “you can treat longer because ice doesn’t really interfere with the treatment.” According to Beausejour, the BioteQ plant currently treats the bulk of the mine drainage. The operating agreement between the client and BioteQ is also tailored. For example, at Raglan, BioteQ constructed the plant with its own capital and operates it with its own personnel. On top of a monthly fee for water treatment based on volume, Xstrata will also pay a monthly capital fee for five years and guarantees a minimum amount of water volume to be treated each year. BioteQ sells the recovered nickel back to Xstrata, where it is smelted along with the conventional output of the mine.

Poised to react This past fall, BioteQ agreed to build a water treatment plant in the Yukon at Minto Exploration’s copper mine north of Whitehorse. The challenge was to capture the suspended solids and subsequent metals swept up by spring run-off and autumn rains, says Anne Labelle, manager of sustainability and legal affairs for Minto’s parent company, Capstone Mining. “Metal effluent regulations and our licence require low total suspended solids (TSS) in our discharge,” says Colleen Roche, environment manager for the Minto mine. “Because of our topography, those limits are tough to meet.” BioteQ’s track record, familiarity with the industry — such as its regulations and time constraints — and commitment to have the plant installed for next year’s spring runoff were critical in earning the contract, according to Roche. The first step of the process will entail coagulating the fine sediment until it becomes heavy enough to sink. “If we can knock down those TSS amounts, we automatically take care of the bulk of the metal concentration in the water,” explains Roche. The “polishing step,” she continues, will be the chemical sulphide treatment of the residual material to reclaim the metals. “Copper is our primary metal of concern, but because sulphide chemistry goes after

Biological solution For a relatively small operation like the Wellington Oro plant, utilizing bags of chemical sulphide serve the BioteQ process. Large-scale operations that consume enough sulphide to make cost an issue are designed to include a bioreactor, an oxygen-free tank containing sulphur-reducing bacteria, which produces hydrogen sulphide gas. The gas can then be injected into the contactor tank to get the precipitation process underway. Using sulphur in the biological process rather than sulphate to produce sulphide requires significantly less electron donor, which cuts down on the space and costs needed to produce the compound. Last year, a mining firm using BioteQ’s anaerobic bioreactor in Arizona recovered 590,000 kilograms of copper from acid mine drainage of a low-grade stockpile at an out-of-service mine — drainage that, in the past, had only yielded environmental damage. Compared to blunt tools used in the past, it is an elegant solution — one that Marchant says more are willing to take a chance on. “Now that we have more operations we are starting to get cold calls.” CIM www.bioteq.ca November 2009 | 25

upfront PROCESSING by Ashok D. Dalvi

Ecology and economics Emerging technical, environmental and economic challenges confronting the nickel and base metal industries Reproduced from a diagram courtesy of Ashok D. Dalvi

financial, social, geopolitical and environmental….” Figure 1 contains a schematic representation of a project or an operation from a systems or holistic point of view. Input includes all materials, energy, land and labour, while the output includes all products, emissions, byproducts and external social, ecological and economic impacts. The entire system can be optimized by dividing the various factors into three categories: those affecting eco-efficiency; socio-economic factors; and markets. The term “eco-efficiency” has emerged to capture the idea that economic and environmental efficiencies can be achieved simultaneously, as confirmed by a number of recent studies. Emphasizing systems analysis, eco-efficiency seeks parallel ecological and economic gains, without sacrificing one for the other. It can be achieved by enhancing material and energy efficiency, reducing environmental and human health-related risks, designing products to fit into ecological cycles, and making products more recyclable or durable. To optimize any mining system, one needs to know the desired end product and the project location. Without this knowledge, most project impacts cannot be determined. For most greenfield projects, the process plant battery limits represent only about 30 per cent of cost. The remainder is related to auxiliary systems and infrastructure, including social infrastructure. Therefore, these merit particular attention. The objective of the engineer and project manager should be to design a project that has the smallest possible footprint and the lowest cost, consistent with the social, marketing and production objectives. These objectives need to be defined at the outset. A project thus optimized would yield maximal returns. Porter and van der Linde2 contend that a firm’s sustainability performance can also be a measure of operational efficiency. They argue that, ultimately, the enhanced resource productivity makes companies more competitive.

Figure 1. A holistic project view

he demand for nickel and other base metals has fallen significantly and it will take a number of years to recover fully. Meanwhile, the metals industry is facing growing challenges due to diminishing ore grades, inaccessibility and complexity of deposits, mounting capital and operating costs, and external socioeconomic and environmental pressures. To cope with them, in what Thomas Friedman1 calls the “EnergyClimate Era,” we will be forced to take a broader view and develop solutions that are not merely technical. In designing solutions, metallurgists, engineers and project managers will require more holistic strategic approaches.

The challenges of the future In the near future, nickel producers must aim to match demand and reduce costs. Traditionally, project evaluation methodology has been serial, with process definition, infrastructure definition, engineering, environmental impact assessment, economic evaluation, etc. following one after another. The industry needs to follow an integrated and systems approach instead. This approach is consistent with emerging thought regarding energy and climate change. In his book, “Hot, Flat and Crowded,” Thomas Friedman1 argues that societies will demand that “your company and your country pay the total cost of ownership for whatever you…produce or consume. The total cost of ownership will include the costs that are near term and long term, direct and indirect, seen and hidden, 26 | CIM Magazine | Vol. 4, No. 7

Applying the holistic model to the nickel industry Figure 2 shows the relative global warming potentials for nickel and other key metals. While its collective contribution

upfront Reproduced from a diagram courtesy of Nickel Institute

PROCESSING

This is not only a global warming issue for laterite producers, but also a cost issue (related to high energy consumption). Reducing energy consumption is important for FeNi producers. Companies have done a great deal over the last 50 years to enhance energy reuse and recuperation. However, as energy and global warming issues assume ever greater prominence, much more emphasis needs to be placed on energy efficiency.

The nature of nickel

Figure 2. Comparison of greenhouse gas emissions

is relatively low (due to lower overall production), nickel’s per tonne greenhouse gas (GHG) intensity is high. The GHG intensity of nickel is not uniform by country. It varies from 7.5 tonnes of CO2 per tonne of nickel to over 100 tonnes, with most operations being below 50. Canadian and Russian levels (~10) are typical for sulphide deposits, while those of Columbia, Japan and New Caledonia (20 to 45) are typical for ferronickel (FeNi) production from laterites. The GHG intensity of Cuba’s high-pressure acid leaching (HPAL) and Caron processes is reasonably representative of hydro and pyro-hydro processes. This indicates that hydrometallurgical processes are not necessarily less GHG-intensive than FeNi processes. If excess PGM credits are excluded, GHG intensity approximates the nickel cost curve. Low GHG intensity is a good indicator of low-cost operation, a relationship confirmed by Strategic Asset Management’s finding of a strong correlation between sustainability and financial returns.3 It is worth noting that GHG intensity, generally expressed per unit weight of nickel produced, distorts the results for ferronickel (FeNi), which contains nickel and iron. This distortion is even more pronounced for nickel pig iron (NPI) whose iron and chromium contents far exceed its nickel content. While the average GHG intensity for FeNi is about 32 per tonne of nickel, it is about 10 if both nickel and iron are considered. This is similar to the GHG intensity of sulphidesource nickel.

Nickel occurs in two main forms — as a part of sulphide deposits or as a laterite (oxide) deposit. Large massive sulphide deposits relatively near the surface, such as those of Norilsk in Russia and Sudbury in Canada, are now depleted or nearing depletion. The probability of finding more such deposits is low. Future sulphide deposits will likely be found at depths of over a kilometre and/or will be lower grade disseminated deposits. Mine development and operations costs, and technical and economic risks will therefore increase significantly. Safe and viable deep-mining technologies that address issues such as rock burst, ventilation and heat removal will have to be developed. Robotics and remote mining technologies will

November 2009 | 27

upfront PROCESSING

also become increasingly necessary. In the case of lower grade, highly disseminated deposits, effective large-scale mining and material handling methods will have to be implemented. With sulphide deposits, the major costs are associated with mining. Underground mining costs are about US$50 to $125 per tonne of ore, while open pit mining costs are about US$10 to $40 per tonne of ore. Unit costs rise as deposit depths increase and ore grades decrease. Fortunately, processing costs are substantially reduced by effectively upgrading the ore. Mineral processing will therefore become increasingly critical in the future. Some of the challenges in mineral processing are: • Increasing concentrate grades while maintaining valuable metal recoveries at high levels for disseminated low-grade deposits containing <1%Ni. • Using gravity separation and sorting to minimize cost and maximize recovery. This must be carried out in situ where possible. • Dealing with ore impurities. • Effectively separating nickel from other metals. “Wet” and “dry” laterite deposits occur in tropical and subtropical areas, respectively. Laterite ores are rocky saprolites (low iron, high MgO) or fine limonites (high iron, low MgO). Dry laterites tend to be intermediate (medium iron and MgO). Saprolites usually have the highest nickel content (1.5 to 3%). Limonitic ores have relatively low nickel content (1 to 1.5%). Dry laterites are also relatively low in nickel (0.8 to 1.2%). Some upgrading can be carried out, but feed to the processing plant remains in the 1 to 3% Ni range for all laterite processing facilities, even after upgrading. Laterite ores are also high in free (10 to 30%) and combined (8 to 12%) water content. Nickel laterite mining is generally low-cost (~US$10 to $35 per tonne ore) open pit or strip mining. However, due

28 | CIM Magazine | Vol. 4, No. 7

to low feed grades and high moisture content, its energy requirements are high. Controlling ecological impacts, containing mine runoff and rehabilitating mined-out areas also pose major challenges to laterite-sourced nickel production.

Environmental considerations In Canada, air emissions are controlled by the Canadian Environmental Protection Act of 1999 (CEPA 99). Releases from base metal smelters and refineries were declared toxic under the CEPA 99 in September 2002. It required that a risk management strategy and instrument be developed to address these toxins and be finalized within two years of the declaration of toxicity. The risk management instrument applicable to base metals is pollution prevention (P2) planning. Factors to consider in preparing P2 plans were to include: • Specific annual emissions limits for 2008 and 2015 • Environmental codes of practice In April 2006, the government issued a notice4 requiring the preparation and implementation of P2 plans for toxins released from base metal smelters and refineries by December 31, 2015. Bill C-30, currently before Parliament, proposes to amend CEPA 1999, the Energy Efficiency and the Motor Vehicle Fuel Consumption Standards Acts and to merge them into what is to be called Canada’s Clean Air Act. Additionally, water-borne emissions are regulated federally under the Fisheries Act. Emissions are also regulated under health acts and by various provincial regulations. Similar regulations or guidelines are produced by the World Bank, the United States, the European Union and various other countries. With increasing NGO and community activism on ecological issues, regulations are becoming more specific and stringent, posing significant technical and economic challenges to the base metals industry. The closure of Noranda’s Gaspé copper smelter in April 2002 and the slated closure of the HBMS copper smelter in Flin Flon as a result of tighter regulations are illustrative of these challenges. CEPA 99 will require new nickel smelters and refineries to capture over 96 per cent of their SO2 emissions. Regulatory requirements already necessitate the provision of facilities at every project to control emissions. The scope of such facilities could often equal that of the processing facilities themselves. Therefore, in the future, metallurgists and engineers need to consider processes that inherently minimize the need for such facilities and incorporate these considerations into overall flowsheet development and project engineering.

upfront PROCESSING

The requirements of the market Historically, nickel demand growth has outstripped GDP growth. Averaged from 1950 to 2004, nickel consumption increased four per cent annually, driven largely by stainless steel. Stainless steel’s share of overall nickel demand rose from about 33 per cent in 1960 to around 70 per cent currently and is expected to reach 73 per cent by 2013. Furthermore, because stainless steel can use lower purity nickel, an increasing proportion of nickel demand will be for lower purity forms. Production data from 2007 show that about 63 per cent of nickel produced was Class I nickel, about eight per cent was nickel oxide and the remaining 28 per cent was ferronickel and NPI. Thus, the industry continues to produce nickel of excessive purity, to great cost and environmental consequences. Additionally, the stainless steel industry has not paid adequately for the iron content of ferronickel and the iron and chrome contents of NPI. A market mechanism has not been found to address this issue. The traditional market, based on LME deliverable (Class I) nickel, distorts both valuation and optimum processing, lowers industry efficiency and increases the cost to the consumer (the stainless steel industry). Metallurgists and engineers should start process design with the known market requirements of nickel purity in mind. The traditional practice is to often design a process and accept its products.

A mindset shift As discussed above, resources, markets, and operational and project impacts (environmental, social, economic) impose external requirements on projects and operations. These externalities demand improved technology, innovation and a mindset shift towards a systems approach. This includes novel methods of exploration, mining and processing that can maximize resource delineation and utilization, reduce costs, increase productivity, reduce energy consumption, maximize asset utilization and reduce environmental and negative social impacts. This mindset shift entails the integration, combined evaluation and optimization of all elements of a project. Corporate approaches to sustainability remain piecemeal and disconnected from business strategy. Sustainability should be built in, not bolted on. It needs to be embedded in operations, systems and culture. With given environmental and social requirements, processes and projects should be reconfigured to minimize energy use and environmental footprints. As noted earlier, this would also lead to greater cost-effectiveness. In their recent survey of 10 corporations noted for their sustainability practices, McEwen and Schmidt5 describe five “gears” of sustainability engagement: comply, volunteer, partner, integrate and redesign. The last two entail more complex high-level activity. Even the best companies consistently achieve only the first three stages. None achieved the fourth level (integrated action across the value chain) con-

sistently or even attempted the fifth level (redesigning for large-scale systems change). This indicates that there is much room for a mindset shift among scientists, engineers, managers and industry leaders.

Conclusions Sulphide-based nickel producers face challenges in mining to reduce costs and in mineral beneficiation to maximize processing feed value. Processing facilities need to devise processes that remove toxic emissions at reasonable cost while minimizing energy requirements and producing nickel optimized for the stainless steel industry. From a capital and operating cost perspective, the simpler the process the better. Significant research needs to be done to conclusively establish whether the HPAL process has environmental and cost advantages over traditional smelting processes. Ferronickel and NPI, with clearly defined product quality, are good fits for stainless steel producers. Ferronickel smelters and NPI producers face the challenge of minimizing their carbon footprints. Laterite smelters must work to control dust and particulate emissions. The cost of complying with increasingly stringent environmental regulations and more social demand is mounting. Operations that fail to manage them face losses of profits or even of social licence. The challenge for process and project engineers is to design processes and facilities that meet social, environmental and energy objectives, minimize capital and operating costs, and meet market requirements. How this challenge is met will determine the fate of the nickel and base metals industries. CIM This article is condensed from the paper “Challenges facing nickel and base metal industries,” published in Green Technologies for Mining and Metallurgical Industries, 2009 COM Proceedings of the Conference of Metallurgists, pp. 231–248. http://www.metsoc.org/estore/index.asp

About the author Ashok Dalvi is president of Dalvi Associates Inc., an independent company based in Ontario, consulting in base metals strategies. He obtained his B.Tech (Hon) in metallurgical engineering from the Indian Institute of Technology in Mumbai and PhD in metallurgy and materials science from McMaster University. He has worked internationally in the fields of process R&D, project management and strategic studies. References 1 Friedman, T.

(2008). Hot, Flat and Crowded. New York: Ferrar, Straus and Giroux.

2 Porter,

M. & van der Linde, C. (1999). Green and Competitive - Ending the Stalemate. Harvard Business Review, Reprint 95507 (September 1995) Reprinted in Harvard Business Review of Profiting from Green Business, HBS Press (Product No. 2336), pp. 131-168.

3 The

Sustainability Yearbook 2009. Strategic Asset Management. Zurich, Switzerland.

4 Canadian

Gazette, Vol. 140, No. 17, April 29, 2006.

5 McEwen,

C.A. & Schmidt, J.D. Leadership and the Corporate Sustainability Challenge: Mindsets in Action (December 10, 2007). Available at SSRN: http://ssrn.com/abstract=1118071

November 2009 | 29

upfront Q & A by Peter Diekmeyer

Building on a strong foundation Interview with OMA president, Chris Hodgson he Ontario mining industry was certainly not immune to the series of curveballs that hit during the past year. Wildly fluctuating raw material demand and prices, labour troubles and the advent of new legislation are all changing the way the industry there operates. To get a sense of how companies are handling the challenges, CIM Magazine recently spoke with Ontario Mining Association (OMA) president Chris Hodgson.

Mining Association of Canada. We have also worked to build on the industry’s social license to operate, improved our outreach to First Nations, promoted employment opportunities in the industry and helped foster education about the industry. We also worked to improve our internal and external communications, including the development of a new logo and upgrading our website with a “members only” section, the distribution of timely e-news items and the posting of relevant economic, environmental and educational information.

CIM: How does the Ontario mining industry fit into all of this? Hodgson: Ontario has an extremely favourable geology, which makes it a great place to do mining. Resources are quite abundant, ranging from base metals, such as nickel, copper and zinc, to precious metals, such as gold, silver, diamonds, platinum and salt. We even have industrial minerals. But geology alone does not automatically ensure success. Companies need to feel comfortable in the jurisdictions in which they operate. Fortunately, unlike some economies, Canada and Ontario have strong traditions of respecting the “rule of law.” Certainty of ownership, which is extremely important to investors, is well-protected here and tenure rules — the right to bring a mine into production — are applied fairly.

CIM: Before joining the OMA, your career included stints as Ontario’s Minister of Northern Development and Minister of Natural Resources. What are some of the key government relations initiatives that the industry is now working on and how has your background helped you to lead in these areas? Hodgson: Before entering politics, I had also worked as a real estate developer. That meant that by the time I joined the OMA, I had already worked both sides of the table. So I know how important effective cooperation is. The other thing I learned is that to influence the decision-making process, you first need to be at the table and to understand what your counterpart is thinking. That said, this may surprise you, but there are lots of similarities between government officials and business people. Both groups have a real desire to do what is right. Right now, on the Ontario legislative front, there are two key pieces that affect our industry. The first is Bill 173, the Mining Amendment Act, which deals with mining explorers more than it does with operators, though we are pleased with its scope. Bill 191, the Far North Act, which is before the House right now, is more challenging. We agree with the goal and certainly want to protect the environment; however, the act is vague and we would like clarification in some areas. If not, the act will not be helpful in making mining here competitive in a global sense. Not all we do involves contributing to the legislative process though. We also provide input into a lot of less visible initiatives, in areas such as human resources, energy, safety and training, and the environment.

CIM: October marks the fifth anniversary of your becoming president of the OMA. What are some of the organization’s main accomplishments since you took office? Hodgson: I was a bit lucky because I took over the helm of a strong association that my predecessor, Patrick Reid, had led for more than 20 years. Much of my efforts have been devoted towards pursuing the OMA’s primary goal, which is to improve the competitiveness of Ontario’s mining industry. For example, we have continued to represent the industry at Queen’s Park. On federal issues, we make our positions heard though the

CIM: Environmental concerns are on the rise around the world. How do you see the industry’s role in all of this? Hodgson: Ontario has a strategy for toxic reduction and we have informed legislators that we want to be part of the solution, not part of the problem. That said, we also want balance so that the industry can stay competitive. We need to make sure that compliance is practical and cost-effective. For example, Regulation 419 is expected to set emissions standards based on health criteria, while other jurisdictions use a “best available technology” approach. Speaking more broadly though, maintaining our

CIM: The world economy has gone through a fairly turbulent time. How has this affected your members? Hodgson: The biggest challenge was the freezing up of credit markets, which contributed to the huge drop in global commodity prices. This caused exploration activity to decline drastically, which in turn led to some downsizing and mine closures. Lately, things are starting to look up. Some of those closures have come back onstream. Prices have bounced back too. Over the longer term, continued urbanization and development around the world means that raw materials demand, particularly from emerging economies, will increase significantly.

30 | CIM Magazine | Vol. 4, No. 7

upfront Q & A

social license to operate is a major challenge. Remember that any new ecological initiative, such as the widespread manufacture of solar panels, is going to require the use of minerals to produce. For example, one of the key ingredients in catalytic converters is platinum, and wind turbines and solar panels cannot be produced without nickel. CIM: One of the industry’s key challenges has been its ability to partner with First Nations. How is that going? Hodgson: Our members have always worked well with the province’s First Nations and we want to continue to build on those successes. For example, there have already been well over 40 Impact Benefit Agreements (IBAs) negotiated in Ontario with First Nations, including ones with De Beers Canada regarding the Victor diamond mine and Goldcorp regarding the Musselwhite Mine. But we want to do more. Everybody has an interest in it. Ontario needs more mines, and mining is already the number one employer of First Nations peoples. CIM: Are there any other key challenges facing the industry going forward and if so, what is your association doing to help deal with them? Hodgson: Our work with Ontario’s Worker Safety and Insurance Board (WSIB) is also very important. As I mentioned before, the safety record of Ontario’s mining

industry is the envy of the world. However, we need to make sure that the insurance rates that our members are charged reflect that fact. Also, keeping the public informed about what we are doing and how society benefits from this is crucial. We conduct regular macro-economic analyses about the contributions that the industry provides, and we make available many of the key findings online. We continue to fine-tune those efforts. We also recently did a micro-economic study as well and were quite surprised by the extent of the downstream economic activity the industry generates. Education is another big issue. The association has produced videos to inform the public about the industry, including the virtual mine tour animation, NickelQuest. We also started a competition among high school students called “So You Think You Know Mining,” to see who could produce the best video about the benefits that mining provides. We have also undertaken initiatives to increase the interest among students in mining as a career. This is important because the supply of skilled labour to the industry could come under pressure in coming years. We have to make sure that we have enough people coming into the industry to replace those who are retiring. CIM www.oma.on.ca

November 2009 | 31

Photo courtesy of Dumas Contracting Ltd.

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The school of hard rocks Depth of experience key to future growth in Northern Ontario by Ryan Bergen

n daily life it is ubiquitous. It jingles in our pockets and powers our toys; it has a place at our dinner tables and then helps with the clean-up. For industry it is indispensable. It makes steel more durable, flexible and stronger against the elements. It is fortunate that nickel weathers well, because the value of the ore, as well as those dedicated to its extraction, are being tested by what some have called the “perfect storm.” After a spike in 2007 to over $20 per pound, the price of the metal tumbled

along with other commodities. Since then, tight credit markets, labour conflict, high production costs, slack demand and an abundance of supply have fueled the tempest further. When nickel prices bottomed out late last year at four dollars per pound, operations in Northern Ontario were forced to drastically cut costs to conserve money. Spotting a break in the clouds may take time. It might also require a dramatic change in perspective and what we mean when we talk about the “Nickel Belt.”

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Silicon Valley of mining Ore bodies in the hard rock were the foundation for the communities in Northern Ontario. The challenge, however, of driving deeper shafts, building better equipment and making mills and refineries more efficient has erected on that bedrock an infrastructure of expertise that reaches around the world. And it ought to, says Dick DeStefano. As executive director of the Sudbury Area Mining Supply and Service Association, he is convinced that the Nickel Belt has the capacity to challenge others for the title of the “Silicon Valley of mining” because of its capacity to apply local knowledge across industries and markets. The movement is already underway, he insists. “We are beginning to see a lot of mining software applications emanate out of here because of the research base and the partnerships that exist between universities and colleges and the private sector.” DeStefano admits that the effort is still a work-in-progress, though. Keeping service and supply shops in a century-old mining camp like Sudbury can be a mixed blessing; complacency, he says, can turn a niche into a rut. He estimates that there are 500 firms in Northern Ontario serving the mining industry and suggests that they should start throwing their weight around. “The Australians have convinced the world that they are better than us at deep mining, but if you really go and analyze it, they aren’t,” he asserts. “They have just created the impression that they are.” He thinks that the time has come for the local supply and service industry to take a look in the mirror and appraise its own impression. “We are trying to make people understand that these 500 companies are a critical mass,” explains DeStefano. “And then if you add 11 research institutes at the university level, and the fact that together our companies have a presence in 48 countries with their software, this is huge.” A glimpse at exactly how huge will come next year when the Ontario North Economic Development Corporation completes its study of the supply and services sector. Once finished, it should provide a snapshot of the prospects for the sector, the extent of its global reach and the potential for it to extend further. In the meantime, DeStefano is bent on broadening the horizons of the suppliers in the region. He invites speakers to share news of projects in the wider world. The events, he says, have born fruit. “We brought PotashCorp in a year and a half ago and since that time, 17 of our companies are working for them that weren’t before.”

Holding firm Those anchored to their operations have braced themselves to ride out the storm. “Our company remains solid and that is key,” says Gerry Bilodeau, vicepresident of operations at First Nickel Inc. “We made a decision to suspend operations at our Lockerby Mine in October of 2008 due to the poor economic environment and extremely low metal prices. Engineering work continues on the Lockerby Depth Project and we feel very strongly that the mine expansion project can take place, providing the right elements fall in line — reasonable metal prices sustained over time and adequate financing. With that, we can begin developing a plan to operate.” November 2009 | 33

Once funding is in place, the company will begin development of its Lockerby Depth Project, which will include a year of pre-production and yield in the neighborhood of 280,000 tonnes of ore per year for more than five years. “The company believes that metal prices will settle at levels which will permit Lockerby Mine to operate successfully,” Bilodeau says. “We have a strong management team and the experience required to weather the storm and get back on track.” “The number one strategy until this summer has been survival,” says David Constable, FNX Mining’s vice-president of investor relations. “Basically what mining companies have been trying to do is survive and not burn up their cash, because they couldn’t get access to more of it. We made the very tough decision last Aerial view of FNX Mining’s Levack operation December to preserve cash.” That meant laying with some nickel by-products deposits in the same area,” off nearly half of the workforce. The unique aspect of the local geology has let the com- explains Constable. “This means we can go into one of our pany maintain some momentum. “In Sudbury, we have the underground mines and, in the same infrastructure, turn advantage that we have separate nickel, copper and cobalt, right and mine nickel or go left and mine copper and preas well as separate footwall copper and precious metals, cious metals instead. So we elected to go left.” This past summer, after weathering the storm, the company “began to look at its future growth strategy, rather than simply survival,” says Constable. “While FNX had a strong balance sheet and zero debt going into the downturn, we decided the time was right to raise an additional $144 million in September 2009 to take advantage of potential opportunities, which always occur in challenging times.” For the near future, Constable expects its nickel resources will stay in the ground. “When we shut down production of primary nickel last year, we said we would not restart until we saw very clear signs of a sustained nickel market recovery,” he says. “And we don’t see that right now. We don’t see increased stainless steel production and we don’t see the Chinese demand increasing. There is probably some movement in their internal and working inventories of nickel, copper and some other commodities, but not long-term demand. The London Metals Exchange inventories have ramped up to 120,000 metric tons of nickel.” The recent pricing of nickel at around eight dollars per pound does not inspire confidence. “We don’t see any sustained signs that this is anything more than an unsupported spike in the price — probably influenced somewhat by the strike at Vale Inco,” claims Constable. Undeterred, Liberty Mines, with operations near Timmins, is heading into the wind. The company’s president, Gary Nash, argues there is cause for optimism and attributes some of the high inventory of nickel with influencing large stainless steelmakers to leave their stock in metal exchange warehouses, keeping prices low. “Once that inventory comes out of the warehouses, where is that nickel going to come from?” he asks. Some will come from the company’s 34 | CIM Magazine | Vol. 4, No. 7

Photo courtesy of FNX Mining

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Timmins nickel mines, which went back into production this past August after nine months of care and maintenance. The adjacent concentrator began work shortly thereafter with shipments of nickel in concentrate to Xstrata Nickel in Sudbury. “It’s good to see it run again,” says Nash. The renaissance springs from the relationship Liberty Mines has developed with China-based Jilin Jien Nickel Industry Co., Ltd. “We are the first guys in the mining business in Canada to do an off-take agreement with a Chinese company,” explains Nash. “We put that together in 2005 and started to deliver concentrate to them in 2006. They did four financings for us since then, one of which we have paid back; the other three we plan to have substantially paid by the end of 2010. They saw what we could do very efficiently and that’s why they did the financings with us.” This included a recent credit facility for $4.5 million to continue development at Liberty’s McWatters Mine. The outlook for future nickel consumption is good, Nash contends, because its applications span from home essentials to cutting-edge technology. “With the growing economies in the world, just think of the simple kitchen sinks that everyone will want to have the use of.” At the other end of the spectrum, he says, “nickel is going to be very widely used in the hybrid car industry,” pointing to the

recent decision by Toyota to limit the use of lithium-ion batteries in favour of the proven nickel metal hydride type. Then, there are the opportunities presented by the nuclear industry. “There are many dozens of nuclear power plants starting up,” Nash adds. “These facilities contain very high alloys of nickel in the containment vessels, some of them pure nickel. There are a lot of — let’s call them ‘futuristic’ — uses for nickel that most people don’t even realize.”

Tighter operations Production may not be roaring along at the frenzied pace of a couple of years ago, but that is not to say that experienced miners are idling as the new year approaches. Investment has freshened, and so has a good measure of work, despite the lingering gloom of the recession. “We are slowly coming out of it,” says Pat Rocca, general manager of North America Drilling Services for Boart Longyear. “The industry has been slow to realize it, but the business level is where it was before the super cycle came through. Demand for exploration rigs and crews went crazy and the industry couldn’t keep up, but now we are back to a normal and sustainable level. We’re looking forward to where we can find growth opportunities to start growing the business at a manageable pace.”

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November 2009 | 35

Photo courtesy of Nickel Institute

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Nickel alloys are essential in energy technology such as this concentrating solar power facility.

Photo courtesy of Dumas Contracting Ltd.

Strong gold prices and a steady demand for copper have bolstered companies with a long history and solid presence in the region. Dumas Contracting has been able to maintain its 1,000-strong workforce. Many of those are hard at work in the gold mining camps of Ontario and Quebec. The Timmins-based engineering and contracting firm has also been on the job deep inside Xstrata Copper’s Kidd Mine, extending the ramp from 9,100 to 9,500 feet.

Antoine Vézina, a member of Dumas’s corporate development team, feels that the opportunity to get out in front of a hiring wave allows Dumas to skim from the top of the skilled labour pool. When working at a producing mine at depths where the heat and humidity test miners and equipment, securing experienced and conscientious miners is invaluable. “We have to maintain a very precise schedule,” says Vézina. “We can’t afford any downtime.” Rocca said Boart Longyear has enjoyed a similar advantage. “In the last few years, many drilling contractors struggled to keep experienced people and were forced to bring in less experienced ones, which created inefficiencies and drove costs up. That has been brought under control.” Though equipment costs are still relatively high, Rocca says the overall economics are sound. “As business has slowed down, there has been an opportunity to work with a more experienced group of people, so some of those costs can be made up through increased productivity.”

Less perspiration, more innovation

Dumas Contracting miners Denis Carrière (left) and Patrick Hurtubise using a stoper for rehabilitation work at depths in the Kidd Creek Mine. 36 | CIM Magazine | Vol. 4, No. 7

Today’s tight finances are helping to usher in changes. First Nickel’s Gerry Bilodeau says they are anxious to apply the lessons learned at their Lockerby Mine once the operation resumes extraction. “By having a better understanding of manpower and equipment performances, training requirements, and by setting realistic and reasonable expectations and exercising the required follow-up to ensure expectations were met, we were able to substantially lower operating costs,” he claims. The added scrutiny, he says, will fire up change in the market. “It helps mining operations track performance and costs, but it also helps the supplier recognize what directions to take in the long term to deliver better equipment and services for the mining operations.”

Photo courtesy of Dumas Contracting Ltd.

Photo courtesy of First Nickel Inc.

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A two-boom jumbo drilling rig works a rock face.

John Pike, Canadian sales director for Boart Longyear, has been watching the drive to cut costs add momentum to the adoption of new technology. He points to the company’s new Stage™3, a diamond drill bit with a 25 mm crown. “It allows you to drill longer,” he explains, “enabling you to put more core in the box faster because you don’t have to pull your rods as frequently to change your bit.” The time and cost savings, he adds, are further amplified when drilling deep. Boart Longyear’s in-house drilling services organization helped refine the technology and inspire confidence in many who were wary of trading the well-proven standard 12 mm bit for the promise of something more.

Looking ahead Whether the recovery of nickel is imminent or still beyond the horizon, those who have made their notches in the Nickel Belt remain convinced the skies will clear. “I think when demand turns, nickel is going to be well positioned simply because the supply side is so restricted,” says FNX’s David Constable. “And the incremental supply is going to come from nickel laterites, which are very, very expensive. People talk about nickel pig iron in China, but it has limited applications. It’s an environmental nightmare, and if energy prices go up, it will become very costly because it is so energy-intensive to produce.” After a century of mining, the region’s identity as a mining giant remains unchallenged, but its character is still being built. “I’m watching these guys survive,” says DeStefano, of the area’s suppliers. “They are very agile, and some of them have been around for 40 or 50 years; they’ve been through five or six major strikes, seven or eight major downturns and they are still here.” He adds that as he talks to more and more people, he is finding many have quietly headed out into new frontiers. He has a

First Nickel’s Lockerby Mine near Sudbury

message for others in the Sudbury area who haven’t made such a move yet: “Stop looking out the window at the smokestack; there are other horizons.” CIM

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November 2009 | 37

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Looking north for prosperity Photo courtesy of Northgate Minerals Corporation

by Brian O’Hara

The Midas touch Ontario is the number one provincial gold producer in Canada, mining over half of the country’s gold in 2008. According to Natural Resources Canada (NRCan), Ontario produced 27.6 million grams of the total Canadian production of 52.6 million grams. In addition, Ontario is the leading provincial gold explorer, accounting for $260 million of the $579 million in precious metals (primarily gold) exploration and deposit appraisal expenditures in Canada for 2008, according to statistics released in March 2009. “Ontario ranks among the top 10 jurisdictions for exploration Exploration drillling at Northgate’s Young Davidson project spending in the world because of the quality of its infrastructure, the diverse and unexplored geology, accessible and reliable ccording to the town’s mayor, Bill Enouy, “Kirkland geoscience information, stable regulatory environment and Lake is back on the map.” Families are moving to the favourable tax policies, including a permanent flow-through area and he estimates that the town population has share program for exploration,” says Ontario Minister of increased from 8,300 to about 9,000. He adds that in the Northern Development and Mines Michael Gravelle. “We past year, housing prices have increased from the $80,000 are looking forward to continued growth in the mining secrange to around $110,000 for a standard three bedroom tor, particularly in Northern Ontario, where numerous new dwelling. Enouy’s optimism is certainly warranted. and exciting mineral development projects are being Northgate Minerals recently raised $100 million in equity advanced.” to help finance the development of its Young-Davidson Ontario gold miners and developers are utilizing innovative Project. They began ramp development and shaft dewater- ideas and methods to increase current and future gold proing in October and plan to commission the mine in 2010. duction. Goldcorp is going deeper at its Red Lake complex in Meanwhile, Timmins is celebrating a series of 100-year order to develop the High Grade Zone below the 57 level and milestones over the next four years, beginning this year developing the deep DC ore at the Campbell complex. with the anniversary of the discovery of the Hollinger, Aggressive drilling campaigns by Kirkland Lake Gold McIntyre and Dome mines. In a sign of the times, the are exploring new targets quite a distance away from wellregion faces mine closures as it welcomes new known historic gold production zones. Detour Gold is projects. The area’s miners and suppliers are busy with the developing a low-grade, high-tonnage open pit operation development of the Apollo Gold-owned Timmins West and near the workings of a closed underground mine. Closed Black Fox operations, the St. Andrew Goldfields’ (SAS) mines are also being redeveloped, as is the case with Holloway, Hislop and Holt projects, as well as numerous SAS’s Holloway, Hislop and Holt gold projects and junior exploration ventures in the region. Goldcorp’s Cochenor project.

Gold exploration and mining in Northern Ontario

38 | CIM Magazine | Vol. 4, No. 7

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Photo courtesy of Northgate Minerals Corporation

production from the Hislop Project for gross proceeds of US$4 million. “Junior gold miners such as SAS must be flexible and use innovative financing techniques,” advises Au. “Project financing for developmentstage mining companies is actually dominated by foreign banks that have a greater appetite for this type of credit risk,” says Paul Martin, CFO of Detour Gold. “It is somewhat disappointing that the major Canadian banks do not take a more prominent role in this area.” According to Jon A. Douglas, senior vice-president and CFO of Northgate Minerals, the conventional bank project finance market, which last year was effectively closed, is now showing signs of life. However, he does say that fewer players are interested in financing resource companies, and banks are being much more selective regarding the type of project, the corporate sponsor Tractor entering portal at Northgate's Young-Davidson project in Matachewan, northern Ontario. and the size of facility they will consider. Certain Canadian banks, as well as other Flexibility on the financing front smaller international banks, who have traditionally been After a difficult year in the markets, Canadian mine equity involved in financing small- to medium-size resource comfinancing has returned, rising 33 per cent to $11 billion in the panies, have already expressed interest in Northgate’s first seven months of 2009, compared to the $8.3 billion Young-Davidson Project. raised in all of 2008. These impressive capital numbers did “Fortunately, we are in a robust gold market at this not include the recent US$4 billion blockbuster equity raised time, which certainly helps,” states Martin. “As well, to by Barrick Gold Corporation this past September. Two days date, we have not seen any vendor financing that earlier, the company had announced they would be requires hedging. Given the size of our project ($844 buying back three million ounces of fixed-price hedges and million capital as per recent pre-feasibility study) we 6.5 million ounces of gold in floating gold contracts. This deci- plan to evaluate a full scope of financing alternatives sion will provide Barrick with full leverage to the gold price. and conclude on the best alternative.” “Mine development capital is currently being financed Neither the Ontario Mining Association nor mining comby a large component of equity augmented by debt,” panies are calling for government support such as loan according to Catherine Gignac, managing director, mining guarantees for mining projects. Rather, the general expecresearch of Sandfire Securities. “Canada has the highest tation seems to be for the government to supply infrastrucdiversity of mining companies, the largest variety of invest- ture for mining projects that will, in turn, benefit the whole ment opportunities and is the primary location for mining province. industry financing.” “We have not asked for anything from the government, It is “very difficult” for a junior gold miner to obtain con- nor have we been offered anything, and that is the way it ventional bank project financing this year, according to Ben should be,” says Kirkland Lake Gold chairman Harry Au, CFO and vice-president, finance and administration of Dobson. “However, not every company is blessed with the St. Andrew Goldfields Ltd., which is developing the existing municipal services and infrastructure that we are Holloway Mine and the Hislop Project. SAS closed a mez- fortunate to have.” zanine financing of senior gold notes in April 2009 for Weighing in on the topic, Martins adds that, “governmenUS$16.2 million, of which $1 million was purchased by a tal support should follow in the area of infrastructure grants director and family members. to support the development of projects and the related benAu explains this deal was structured for sale to high net efits of employment and taxation. A specific case for Detour worth private investors and private fund managers by agree- Gold is that we need to connect to the hydro power station, ing to deliver 32,400 ounces of physical gold (about 10 per which is over 100 kilometres from the site.” cent of production for the first three years). SAS also guaranThe ongoing challenge in financing large mining projtees investors a minimum gold price of US$750 per ounce ects will not stop viable mine projects, however it will make and pays no interest. In addition, SAS has granted Franco- it more difficult for junior companies with advanced exploNevada a four per cent NSR royalty interest on future gold ration projects to bring them into production. CIM November 2009 | 39

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Taking diamonds from mine to market Photo courtesy of Crossworks Manufacturing

by Marlene Eisner

Polishers at Crossworks Manufacturing in Sudbury

annual US$73 billion global retail jewelry market using the high-quality rough diamonds coming out of the Victor Mine. “We wanted to see if there were any valueadded opportunities that we could realize, such as jobs and investment with local benefits and empowerments,” explains Gashinski. “We also wanted the Ontario diamonds to be on Ontario jewelry.” With the Victor Mine already producing top-quality diamonds and a process in place to collect royalties, the province then wanted to find a way to take the concept of diamond mining all the way to retail — from mine to market. This included mining (production), sorting, valuation, cutting and polishing, jewelry manufacturing and retail. The first step was to guarantee a minimum yearly supply of rough diamonds that could be cut and polished in Ontario. To do that, the provincial government negotiated with De Beers Canada and the Diamond Trading Company (DTC) to make available up to 10 per cent by value of the rough diamond production mined from Victor. With the Victor Mine forecasting a yearly average production of approximately $250 million in diamonds, it would provide approved cutters and polishers in Ontario an opportunity to purchase up to $25 million worth of rough diamonds each year. For De Beers Canada, the request was not unusual. “This model already exists in Canada at our Snap Lake Mine,” says De Beers Canada president Jim Gowans. “When the government of Ontario wanted to have a similar opportunity, we certainly expected it. And we’re happy to sit down and help, providing the burdens are realistic to all involved.” Once the agreement was inked, the next step was to find an experienced and committed cutting and polishing company that would set up shop in Ontario. The Diamond Sector Unit put out a request for proposals for a global competition looking for such a company. Interested parties needed to meet specific performance requirements in terms of jobs and investments, as well as a plan for how they would help promote Ontario diamonds. “They also had to pass a requirement that the

Ontario Diamond Sector Unit seeks to bring the province value-added opportunities

he Ontario Diamond Sector Unit was established to develop key policies as well as a legislative and regulatory framework for the province’s burgeoning diamond industry. The unit operates the valuation process for the province’s rough diamonds, including administrative processes for verifying and collecting royalties. It is also there to pursue any value-added opportunities, new exploration and investment in Ontario. “We slowly started developing the sector in the summer of 2006,” says Ron Gashinski, director and chief gemmologist at the Diamond Unit Sector. “We knew the De Beers Canada’s Victor diamond mine was opening in 2007-2008 and, as a new commodity for the government, we knew we had to do something similar to what was done in the Northwest Territories [BHP and Rio Tinto mines] and find a framework to value the production of diamonds.” The Diamond Sector Unit borrowed that framework and used it as a template, enhancing it for Ontario’s needs. That included finding ways to put forward the goals and aspirations of Ontario with regards to capturing a piece of the 40 | CIM Magazine | Vol. 4, No. 7

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DTC had for their sightholders,â&#x20AC;? says Gashinski. there will hopefully be another cutting and polishing factory,â&#x20AC;? â&#x20AC;&#x153;Whomever we selected had to have the financial where- says Gashinski. With the official launch in March 2009 of the withal to cut diamonds in Ontario.â&#x20AC;? Diamond Bourse of Canada in Toronto â&#x20AC;&#x201D; where diamond In the final analysis, it was a Canadian company that dealers can trade, sell and buy polished and rough diamonds was chosen; Vancouver-based Crossworks Manufacturing, in a safe and secure environment â&#x20AC;&#x201D; Ontario is well on its way a subsidiary of HRA-SunDiamond Group, whose history to becoming a key player in the global diamond pipeline. goes back to 1950 in Antwerp, Belgium. Crossworks Other ideas are in the works that include collaboraopened as a sales branch in Vancouver in 1982 and, tions with colleges and aboriginal artisans. â&#x20AC;&#x153;We also according to global marketing manager Dylan Dix, has want to further our goals and aspirations for the North developed as the largest manufacturer of branded by including the First Nations Peoples in this kind of Canadian diamonds in the word. They have three factories: participation, so that everybody derives benefits from one in Vancouver, one in Yellowknife, and now, one in this terrific opportunity.â&#x20AC;? CIM Sudbury. In mid-August, the company began cutting and polishing in its Ontario location. It employs 30 polishers and had its grand opening on October 14. â&#x20AC;&#x153;I think one of our main features is that we have an extensive Canadian diamond brand campaign where we guarantee the pedigree of each diamond and the mine that it comes from,â&#x20AC;? says Dix. He says Crossworks was a good choice for the Ontario government because even in a global downturn, the company has been successful and profitable in their Vancouver and Yellowknife locations. â&#x20AC;&#x153;Therefore we would be a company that would be feasible in a long-term process,â&#x20AC;? adds Dix. With all these variables now in place, the diamond industry in Ontario is starting to sparkle. Gashinski says his unit is working on a certification of origin proRoll Crusher High Capacity for Potash s Adjustable Size Control gram so that customers can be assured of where the diamonds they purchase are mined, cut and polished. â&#x20AC;&#x153;Ontario has been blessed in a big way,â&#x20AC;? says When precise product size with fewer fines and maximized yield is important, Gundlach Roll Crushers get it right. Every time. Every Gashinski. â&#x20AC;&#x153;The diamonds are probably day. Day after day. And with its Adjustment System, Gundlach the best in the world for quality. People Roll Crushers even let you produce different sized, precisely sized who are looking for a high-quality, origin product on-the-fly. certified, conflict-free product are Find out why Gundlach Roll Crushers and CAGE-PAKTORÂŽ assured that these diamonds are cage mills are the preferred crushing solutions for Canadian.â&#x20AC;? De Beers Canada estimates potash (ore through flake sizing), coal, the Victor Mine has a production life of salts and lime. approximately 10 years with its current Learn more at www.Gundlach.us/cim known resources. Into its second year, or from PEACOCK, our representative in Canada, the company hopes further exploration at www.peacock.ca will result in new mineable sources. â&#x20AC;&#x153;We have about 16 other kimberlite Precise Product Sized for Maximum Yield pipes in the Victor IBA area,â&#x20AC;? says Gowans. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re working on two quite actively to see if we can prove a resource to add onto Victor. It would be a shame to #253(%23 see the level of activity go for naught.â&#x20AC;? As for the Diamond Sector Unit, itâ&#x20AC;&#x2122;s full Gundlach Equipment Corp., One Freedom Drive, Belleville, Illinois 62226 USA 4/,, &2%% ÂŹ '5.$,!#(ÂŹsÂŹ0HONE ÂŹ ÂŹsÂŹ&AX ÂŹ speed ahead in what seems to be a very %MAIL ÂŹ"ETTER#RUSHERS 'UNDLACH USÂŹsÂŹWWW 'UNDLACH US enriching future. â&#x20AC;&#x153;It is moving at an excellent pace and in another three to five years,

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November 2009 | 41

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Keeping the engine going by Marlene Eisner Photo courtesy of DMC Mining Services

During the last three decades, large mining companies began closing down some of their internal operations, creating a major shift in business practices. This led to the growth and development of a strong supply and service sector. “The supply sector was created in Sudbury when the mine companies started to concentrate on their core competencies,” explains Reid. “They started farming things out and that gave birth to a lot of firms, creating opportunities for other people.” Today, there are more than 300 businesses from the supply and service sectors in the region, making them the city’s largest employer, hiring approximately 8,000 people. Even though that number is down 4,000 from a year ago due to the global economic situation, one of the city’s main business strategies is to continue developing this sector. “We have a very large, diversified supply and service sector here,” says Reid. “We support the local association that promotes the suppliers in town, SAMSSA, and we work with various levels of government on trade and buying missions. The number one economic engine is the mining and supply sector. We work with them to attract them here.” In 2002, DMC Mining Services successfully sank an 18-foot diameter, concrete-lined ventilation shaft 3,370 feet deep at Vale Inco’s Garson Mine in Sudbury.

With a 90-year history in the area, Terex supplies underground and surface drilling equipment and shaft jumbos, and manufactures jumbo drills. They service mining companies as well as the contracting, engineering and construction companies that support them. Regional sales manager, Jim Laroche, says being located in Sudbury brings his company into the heart of the industry. “We have worked with everyone from Vale Inco to Xstrata, as well as companies such as Castonguay, Cementation and J.S. Redpath,” says Laroche. In an industry that is constantly shifting and changing, Laroche says one of the challenges he faces as a supplier is answering the specific needs of his clients and providing up-to-date machinery equipped with the latest technology. “We find that over the years we have increasingly been customizing equipment for our clients.” As companies expand their exploration opportunities, their equipment needs change. Whether it’s going deeper

Synergy key to Sudbury suppliers’ success Greater Sudbury is a city redefined. With a population of just under 160,000 and a successful reclamation program underway, this “mining town” is an example of a workable symbiotic relationship between mining operators, their suppliers and the community in which they live. Paul Reid, a business development officer with the city of Greater Sudbury, has lived in the area his whole life. In the last 30 years, he has witnessed a series of changes, from the greening of the city, to the growth and expansion of a globally placed supply industry. “Sudbury is a great place to live,” says Reid. “It’s a modern city with all the amenities in a great setting. There are about 300 lakes within the boundaries of the city and you would be hardpressed to find land that hasn’t been reclaimed.” 42 | CIM Magazine | Vol. 4, No. 7

Making it work

Photo courtesy of Cementation Canada Inc.

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Nickel Rim conveyor

Photo courtesy of Terex Mining

into a mine where the ore zones are smaller, or the desire to expand cooling systems, take larger bulk samples or increase rod carousels, Laroche says the industry is becoming more sophisticated. Mine operators are requiring “extreme” data collection. Suppliers are answering that need by offering computerized equipment and developing machinery that takes into account the safety of the operator. “We developed a new product, the MK7 jumbo, based on the participation of 173 mines in North America,” says Laroche. “Some of that development came out of two key areas; maintenance and the health and safety of the operator.” That means a design that allows the maintenance person to service the equipment from ground-level without having to climb on the machine. It also means designing the cab ergonomics to put the operator into a climate-controlled environment with sound reduction, on a machine with an anti-vibration suspension. Laroche states that there have also been accommodations in relation to cash flow. “We’re doing more leasing business,” he says. “Instead of companies having to put up the cash out front, they are able to lease. We’re also being asked to support equipment more, whereas in the past, mining companies were having their staff to support it.”

Establishing long-term relationships Cementation, an underground mine contracting and engineering company, started their Canadian operations in 1998, with their first contract for Falconbridge’s Fraser Mine. “Sudbury has been very key to our growth,” says Roy Slack, president of Cementation Canada Inc. “Our head office is in North Bay but we have our field office in Sudbury.” Slack says the way for businesses to stay healthy is to establish long-term relationships with clients. The industry understands this and works together to develop best practices in all sectors. He says the focus on safety has never changed, regardless of the economy, and has always been a numberone priority. Where he does see a change is that different clients have different requirements. “Some of it is capital, some of it is operating,” Slack says. “We sit down with our clients and we help out wherever we can. Our suppliers do the same with us. When times are a little tight we work it out. The whole supply chain is coming together to do what they can in this economy.” Slack says it is hard to say what future projects will be, although Xstrata’s Nickel Rim project is set to go into production soon, and Vale Inco’s Totten project is also moving ahead. “Even though the mine operators have trimmed down their operations, they are still looking to produce in the area,” he says. Recently, Cementation has been expanding their horizons and for the last two years has been laying the groundwork for operations in South America and Chile. Slack says that working with sister companies in these countries aids them “in terms of trading ideas and ideologies. We work with the group to review mining and international operations. We certainly look for global best practices.”

Working together in a competitive market Terex MK7 Jumbo

The market price of nickel has slowed business somewhat, but James Clark, area manager for DMC Mining Services, is taking it all in stride. The key, he says, is working November 2009 | 43

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together closely with the clients. “There’s enough doom and gloom,” he says. “Only together are we going to get through this. Ultimately, this is a buyer’s market. When work comes up, the clients are going to want the individual company to have a safe, cost-efficient method. With the amount of competition out there, especially in the Sudbury area, you have to be innovative and keep your cost down to a minimum to be successful on the project. We rely on outside suppliers as well. We’re going to remain competitive and they are going to remain competitive.” Perhaps the greatest challenge, he says, is being able to identify key individuals for upcoming projects. Unlike a few years ago, Clark says the market is now flooded with well-trained individuals. “How do you capture the individual best suited for the job?” he asks. “How do you get through that and how do you get the right person for that job?”

It’s all about the people Levert Personnel Resources Inc. has been providing temporary and full-time personnel to the mining industry for 27 years, identifying appropriate candidates to suit mining jobs that range from a payroll clerks and administrative assistants to engineers and mine managers. “We deal with large and junior mining companies,” says general manager, Terry Zuk.

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44 | CIM Magazine | Vol. 4, No. 7

“We know what being a millwright entails as well as the requirements for different positions underground; we can find those people.” Safety is a big factor in mining, and Zuk says it is vital to make sure workers are properly trained for the job. Mining companies are taking extraordinary measures to ensure the safety of their employees, and as a human resources agency, Zuk makes sure the candidates he recommends know what they are doing. “We have to ensure that when we send someone to a work site, they have the right training, the right certification and the right credentials. Hiring has become complicated; there’s a huge check list to go through. It’s not just about hiring a warm body.” The job market has always been a dynamic one, he says, moving up and down with the local and global mineral markets. “It’s a fluid market. Some of the suppliers are a little quieter, but there’s always maintenance to do at a facility. You always have to look down the road and realize that nothing is permanent. A soft market is not forever.”

Finding the right niche Tega Industries, a multinational company operating out of India for more than 35 years, set up its Canadian office in Sudbury in 2003 after previously establishing themselves in Australia, Sweden and Africa. “We chose to come to Canada after building an international customer base because most of the mining companies in Canada are operating in various other countries,” explains Vinay Grover, general manager for Canadian and South American operations. “A global reference base was very important before we could start selling here.” A chance meeting in 2001 with Sudbury representatives at a mining show in the Middle East was the impetus for Tega’s decision that Northern Ontario was a good place to open up shop. “From there, we have access to the main mining markets of Northern Ontario and northwestern Quebec,” says Grover. The company manufactures a host of engineered rubber products in India that include grinding mill liners, rubber and polyurethane screening media and various conveyer components. Orders are sent to India and, once manufactured, the products are shipped and distributed to various mining companies across Canada. “Despite being a global company, our philosophy is to act locally,” explains Grover. “The product is very service-oriented, so we have to be close to the customer.” Grover acknowledges that there have been some setbacks because of the economy but he is optimistic. “In every challenge we saw an opportunity. We are one of the few companies who are hiring. We are going out to find more of the business that is there. We are very excited about the future.” This optimism appears to be a common characteristic of Sudbury-area suppliers. This, of course, is not surprising given the sector’s long history of resilience. If there is a lesson to be learned from the longevity, it is that cooperation and dialogue remain key to facing both the challenges and opportunities in an ever-changing global landscape. CIM

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Photo courtoisie de Dumas Contracting Ltd.

Un ouvrier sécurise le toit avec un grillage.

L’expérience est la clé de la croissance dans le Nord de l’Ontario

e nickel : nous en avons tous dans nos poches, il fait marcher les jouets et siège à notre table. Il est indispensable dans l’industrie car il durcit l’acier et le protège contre les éléments. Il est heureux que le nickel résiste bien aux difficultés, météoriques et financières, car la valeur du minerai est « en pleine tempête. » Après une hausse à plus de 20 $/lb en 2007, le prix du métal a chuté pour atteindre un creux de 4 $/lb. Les marchés serrés du crédit, les conflits de travail, les coûts accrus de production, la faible demande et l’abondance de l’offre ont contribué à la tempête. Les gisements ont permis l’établissement de nombreuses communautés dans le Nord de l’Ontario. Les défis de creuser des puits toujours plus profonds et de rendre les usines plus efficaces ont conduit à une infrastructure d’expertise reconnue à travers le monde. Dick DeStefano, directeur exécutif de la Sudbury Area Mining Supply and Service Association, est convaincu que la Ceinture de Nickel pourrait devenir la « Silicon Valley » de l’exploitation minière. Ce mouvement est déjà enclenché. « Nous voyons beaucoup d’applications 46 | CIM Magazine | Vol. 4, No. 7

diversifiées de logiciels miniers en raison de la recherche et des partenariats entre les universités et les collèges et le secteur privé. » M. DeStefano estime que le Nord de l’Ontario a environ 500 entreprises desservant l’industrie minière et il croit qu’elles pourraient être plus agressives. « Nous essayons de faire comprendre aux gens que ces 500 compagnies constituent une masse critique. Ajoutez 11 instituts de recherche de niveau universitaire et la présence de nos compagnies dans 48 pays, vous conclurez que c’est énorme. » Un aperçu de l’ampleur sera dévoilé lorsque la Ontario North Economic Development Corporation terminera son étude des biens et services disponibles. En attendant, M. DeStefano veut élargir la portée des fournisseurs de biens et de services dans la région en invitant des conférenciers à partager les nouvelles de projets à travers le monde. « Nous avons invité PotashCorp il y a un an et demi et, depuis ce temps, 17 de nos compagnies travaillent pour eux. »

Tenir bon

Photo courtesy of Dumas Mining

Photo courtoisie de Liberty Mines

Gerry Bilodeau, vice-président aux opérations, First dans les technologies de pointe. « Pensons juste à la Nickel Inc. : « Nous avons décidé d’arrêter l’exploitation à la demande pour des éviers de cuisine dans des économies en mine Lockerby en octobre 2008 en raison du mauvais cli- développement et, à l’autre bout de la gamme d’applications, mat économique et des prix extrêmement bas des métaux. pensons à la décision récente de Toyota de limiter l’utilisation Les travaux d’ingénierie continuent à la mine et, avec un des piles lithium-ion en faveur des piles à hydrure métallique financement et des bons prix, nous la développerons en de nickel », dit-il. D’autres utilisations « futuristes » du nickel profondeur pour produire environ 280 000 tonnes par concernent les enveloppes de confinement dans les cenannée durant plus de cinq ans. » trales nucléaires; ces enveloppes sont fabriquées en alliages « Jusqu’à cet été, la stratégie était de survivre », dit à haute teneur en nickel, voire en nickel pur. David Constable, vice-président aux relations avec les De forts prix pour l’or et une demande constante pour investisseurs, FNX Mining. « Les compagnies devaient le cuivre aident les compagnies solidement ancrées épargner le comptant; pour nous cela a signifié la mise à dans la région. L’entrepreneur Dumas Contracting Ltd. a pied de près de la moitié des travailleurs. » L’aspect unique pu conserver sa main-d’œuvre de 1 000 travailleurs. Selon de la géologie a cependant permis à la Antoine Vézina, un membre de l’équipe compagnie de garder un certain Dumas, la possibilité de recruter les momentum. « À Sudbury, nous avons meilleurs travailleurs spécialisés joue en l’avantage d’avoir des gisements disfaveur de la compagnie. Lors de travaux en tincts de cuivre, de nickel, de cobalt et grande profondeur, où règnent humidité et de métaux précieux », explique chaleur, il est indispensable d’avoir des M. Constable. « Dans une de nos mines mineurs consciencieux et expérimentés. souterraines, nous pouvions aller à Selon M. Rocca, directeur général des droite extraire du nickel ou aller à services de forage chez Boart Longyear, gauche extraire du cuivre et des métaux la compagnie jouit d’avantages semprécieux, nous avons choisi la gauche. » blables. « Nous avons déjà embauché « Au cours de l’été dernier, la comdes gens sans expérience, cela a causé pagnie a examiné sa stratégie de croisdes mauvais rendements et a augmenté sance », poursuit M. Constable. « Nous les coûts. En travaillant avec des gens avons levé 144 M$ en septembre pour d’expérience, vous pouvez récupérer une profiter des occasions qui surviennent partie des coûts élevés des équipements souvent en temps difficiles. Cependant, par une productivité accrue. » à court terme, nous avions décidé de ne Des finances serrées aident parfois à pas repartir la production de nickel prieffectuer des changements. Selon maire avant de voir des signes très M. Bilodeau, la compagnie a hâte de clairs d’une reprise des marchés. Nous Minerai à haute teneur en nickel - mine Redstone mettre en application les leçons ne percevons pas cette reprise, nous ne de Liberty apprises à la mine Lockerby. « En comvoyons pas une production accrue prenant mieux le rendement des d’acier inoxydable ni une augmentation de la demande de équipements et les exigences de formation et en établisla Chine. La Bourse des métaux de Londres a des inven- sant des buts réalistes, nous avons pu abaisser nos coûts taires de 120 000 tonnes métriques de nickel. » Les prix d’exploitation. » D’autres tels que John Pike, directeur des récents d’environ huit dollars la livre de nickel n’inspirent ventes chez Boart Longyear, perçoit les coupures de coûts pas confiance. comme une occasion d’adopter de nouvelles technologies. La compagnie Liberty Mines a décidé de foncer; son président Gary Nash soutient qu’il y a de la place pour de L’avenir « Je crois que le nickel sera bien positionné lors du l’optimisme. « Une fois que l’inventaire sera sorti des entrepôts, d’où proviendra le nickel? » demande-t-il, espérant retour de la demande », dit M. Constable. « L’offre additionqu’il viendra de la mine de la compagnie à Timmins. Cette nelle proviendra des gisements latéritiques de nickel qui mine a redémarré après un arrêt de dix mois. Cette renais- sont très chers à exploiter. La fonte brute de la Chine consance découle des relations entre Liberty Mines et la Jilin stitue un cauchemar environnemental et demande beauJien Nickel Industry Corporation basée en Chine. « Nous coup d’énergie à produire. » Après un siècle d’exploitation minière, l’identité de la sommes les premiers au Canada à avoir une entente d’exploitation avec une compagnie chinoise », explique région en tant que géant minier demeure incontestée. « Je M. Nash. L’entente de 4,5 M$ vise à poursuivre le regarde survivre les gens; certains sont en place depuis 40 ou 50 ans. Ils ont connu des grèves majeures et plusieurs développement de la mine McWatters. Selon M. Nash, l’avenir du nickel est bon; en effet, il se baisses économiques. Plusieurs se sont tournés vers retrouve autant dans des outils domestiques essentiels que d’autres horizons; c’est la solution. » ICM November 2009 | 47

Photo courtesy of Xstrata Nickel

featured mine

Ventilation surface fans at Nickel Rim South. Nine kilometres north of Sudbury, the mine is expected to provide high value ore to Xstrata Nickel’s nearby smelter for at least 15 years.

Cooperation key Xstrata’s Nickel Rim South project approaches completion by | Dan Zlotnikov

A decision to employ an approach utilizing engineering, procurement and construction management (EPCM) was deemed vital to the success of the Nickel Rim South project, which is expected to be completed on schedule, within budget and, most importantly, safely.

With more than 80 active mines and processing facilities across five continents, Xstrata does not lack experience at starting up new mines. But no matter how experienced the company, each new mine is an enormous undertaking, with unique challenges and demands. Now, with Xstrata’s Nickel Rim South Mine in Sudbury approaching completion, it’s an excellent time to take a closer look at the newcomer’s progress and promise. According to the International Nickel Study Group, North and South America together produced 312,900 tonnes of nickel 48 | CIM Magazine | Vol. 4, No. 7

in 2008. Nickel Rim South has already changed the picture for 2009, contributing 8,640 tonnes, or just under three per cent of that amount. The mine’s impact will increase significantly when it begins commercial production. In 2011, once output reaches the target of 1.25 million tonnes per year, Nickel Rim South will account for an impressive 20,800 tonnes of nickel, approximately 6.5 per cent of the Americas’ total. Once the deposit, located north of Sudbury, was discovered in 2001, at depths between 1,100 and 1,800 metres,

featured mine Xstrata Nickel spent the next couple of years on additional surface drilling in an effort to further delineate and define the resource. The company went ahead with the prefeasibility study in early 2003, followed shortly after by a full-scale feasibility study. Based on the promising results from this work, Xstrata made the decision to begin construction, with execution commencing in early March 2004. Rick Collins, the new mine project manager, joined the project in May 2003. He has been there to witness and guide the project through its construction and development to date. “A new greenfields underground mine project goes through some fairly distinct phases,” says Collins. “You have about a year of shaft sinking setup, during which time you establish the site and shaft sinking infrastructure, (including the hoists, headframes and hoisting plant) the shaft sinking stages, the shaft collars, electrical supply services, and so forth.” This phase lasts approximately one year, according to Collins. Once the setup is complete, the shaft sinking itself is ready to begin. At Nickel Rim South, the sinking phase began in early 2005, some 11 months after the go-ahead.

Going vertical “We sank two shafts – a 7.6-metre diameter production shaft and a ventilation/secondary egress shaft at 6.1-metre diameter,” Collins continues, “both of which were completed safely and on schedule. This stage lasted approximately two and a half years, and was completed in the third quarter of 2007.” The main shaft descended to a depth of 1,735 metres, with the secondary shaft not far behind, at 1,685 metres, typical depths for the Sudbury Basin, according to Collins. But with the completion of the shafts, Nickel Rim South also hit another significant milestone. “Health and safety in heavy construction and shaft sinking is always a challenge,” explains Collins. “If you ask me which factor the team would point at as being most proud of, I’d say it’s that we’ve completed two deep shafts, for a total of 3,400 metres of shaft sinking, without sustaining a lost-time incident. I don’t believe that’s been done in the industry before.” In fact, he adds, development and construction continued for five years, totalling over 5.6 million work hours, without a single lost-time incident.

price fluctuations, the mine is due to be completed on schedule and within the original budget. This is especially due to Xstrata’s decision to use an EPCM company to handle the project. “The approach we took — of EPCM control of the project — was critical,” says Collins of the relationship. “It allows you to bring in one organization that specializes in project delivery and one group that applies the same standards, systems and level of control across all your engineering, procurement, construction management, commissioning and delivery. This way, all of the contractors assimilate the project standards, expectations and annual objectives. Project KPIs are planned very carefully so individuals and corporations have the same definition of success and strive for the same targets and objectives, which are measurable and fine-tuned annually.” This harmonization of expectations was especially important in light of the commodity boom. With demand for skilled contract labour far outstripping supply around the world, the project team had to take steps to ensure construction continued apace, and without excessive cost increases. “To achieve this,” says Collins, “prior to engineering completion of certain elements, we locked in contractors for the initial portions of those elements. With construction contracts, your normal procedure is to develop 100 per cent engineering, then place a tender for the whole scope of work, and

Teamwork Collins places the credit for the success of the shaft sinking stage with the team of what he terms “best-for-project” people: a combination of employees of Xstrata Nickel itself, EPCM provider Hatch-McIntosh, and underground construction and shaft sinking contractor Cementation Canada. In fact, Collins believes that the contractors used by Xstrata for the Nickel Rim South execution were vital to the project’s overall success. Despite sharp commodity, equipment and labour November 2009 | 49

featured mine select the best bid based on your adjudication criteria. As the market heated up, we decided to tender and lock in some contractors on early portions of the scope, with advice that further portions would be tendered subsequently as engineering was completed. In this way, we avoided getting into a position of insufficient responses to competitive bids." This innovative approach allowed the project to remain on schedule, but there was also a more direct monetary benefit. “If we would have given a large chunk of the work to a general contractor, we would have paid delay costs, mark-ups and administration fees to cover their selection of subcontractors and we wouldn’t have achieved the lower costs that we did,” Collins explains. Collins highlights the case of the mine backfill plant. “We were able to separate out discrete portions of the work for foundations and early pieces of the structure, in order to attract interest from the marketplace,” he explains. “This way, we would advise the contractors in the bidding pool that larger portions were still under engineering and would be coming out onto the street in a few months’ time.” Overall, Collins says, EPCM contracting and engineering services amounted to roughly 12 per cent of the total installation costs. “But EPCM gives you vastly improved certainty on safe work, timely delivery and cost control,” he adds of the benefits provided by Hatch-McIntosh. The joint venture handled everything from engineering design, logistics, procurement, construction management and commissioning duties, to safe execution procedures and environmental monitoring. Even equipment – from Howden ventilation systems to Brutus mucking jaws used in the shaft sinking – was procured by the contractors. However, Xstrata, as the project owner, signed off on major purchases and equipment. The Hatch-McIntosh partnership itself is another advantage that Collins says sprung from choosing to go with an EPCM provider. Hatch is a full-scale EPCM contractor but, as he explains, there were some skills the company felt were best provided by the owner and by specialists. “At the time Hatch commenced on Nickel Rim South in 2003, it was decided we’d go into a joint venture with McIntosh, which had some areas of expertise in terms of underground design and a specific understanding of the Sudbury Basin mining conditions,” Collins explains. “Combined with Hatch’s project management skills and systems, there seemed like a good fit of skill sets. And indeed, Hatch-McIntosh proved to be a great support for us.” The final stage of the project is expected to be completed in March 2010, and entails two and a half years of lateral and vertical development, underground and surface infrastructure, such as mine support and ore/waste handling systems, backfill plant, administration and dry facilities. Systems commissioning and production ramp-up are also included in the final 10 months of the project, which culminates in the hand-off of an operational mine, fully transitioned to the mine operations team. 50 | CIM Magazine | Vol. 4, No. 7

On schedule and budget It’s worth noting that the mine is already producing ore, and has been doing so for five months. The original schedule, drafted during the prefeasibility study stage, expected the first stope to be brought in January 2010. “When we went to feasibility, we realized we could tighten that up and deliver the first stope in the second quarter of 2009, and six years later we did just that,” says Collins. Eight months ahead of the original schedule, the first stope was brought in during May of 2009. The mine has been ramping up production ever since, reaching 70,000 tonnes in September. The production goal for the 2009 calendar year is 540,000 tonnes, after only eight months of operation. Projections for 2010 have the operation producing some 1.1 million tonnes of ore, at 90 per cent capacity. The following year will see final interconnection of ramps completed and the third stage of the underground ore waste handling facility come online, bringing the operation to optimal operational capacity and annual production of 1.25 million tonnes of ore.

The future is here “When the mine goes into full-scale production, it will be one of the most automated mines in the world,” says Collins. Virtually all aspects of the operation will be monitored and controlled from the mine operating centre, with automated equipment keeping tabs on rock breakers, hoisting, ventilation on demand, ore/waste handling, dewatering, communications, backfill, fuel, energy, water, shotcrete, substations, remote production scoops, truck loading and weigh-scale systems. The mine-wide fibre network will enable ventilation on demand, asset tracking, condition monitoring, voice-overInternet protocol (VoIP) and automated hoisting. Access to real-time data from underground mobile equipment is one of the benefits of Nickel Rim South’s fibre network. Instead of manually logging information about equipment performance, data will be transmitted wirelessly through the network to surface. Collins does not dismiss the possibility of greater automation being introduced in the future. “It gives you greater efficiency and more ability to track your operation in detail,” he says. “Safety is a factor as well – we’re taking people out of the more hazardous situations.” With 18.2 million tonnes of ore resource containing an average of 1.5 per cent nickel, 2.7 per cent copper, and 4.1 grams per tonne of platinum group metals, the mine life is projected at 15 years, says Collins. There are no existing plans to extend that for the moment, but if the opportunity arises, Xstrata will no doubt be happy to keep the mine in profitable operation. CIM www.xstrata.com

La mine Nickel Rim South, située à neuf kilomètres au nord de Sudbury devrait fournir Xstrata en minerai de fer de haute teneur pour une période d’au moins 15 ans.

La coopération constitue la clé Le projet Nickel Rim South de Xstrata presque prêt La décision d’utiliser une approche EPCM a grandement contribué au succès du projet Nickel Rim South; ce projet devancera l’échéancier, coûtera moins que prévu au budget et, encore plus important, sera construit de manière sécuritaire.

Détenant plus de 80 mines et usines de transformation actives dans cinq continents, Xstrata ne manque pas d’expérience pour démarrer de nouvelles mines. Cependant, chaque nouvelle mine comporte ses propres défis uniques. Maintenant qu’elle est presque prête, jetons un coup d’œil sur la mine Nickel Rim South à Sudbury. Selon le International Nickel Study Group, l’Amérique du Nord et l’Amérique du Sud ont ensemble produit plus de 312 900 tonnes de nickel en 2008. En 2009, Nickel Rim South a déjà contribué 8 640 tonnes. L’impact de la mine augmentera de manière significative lorsqu’elle commencera sa production commerciale. En 2011, une fois que l’extraction aura atteint la cible de 1,39 Mt/a, Nickel Rim South produira 20 800 tonnes de nickel, soit environ 6,5 % de la production totale des Amériques. 52 | CIM Magazine | Vol. 4, No. 7

Le gisement, situé au nord de Sudbury, a été découvert en 2001 à des profondeurs entre 1 100 et 1 800 mètres. Il contient 18,2 Mt de réserves prouvées et probables à une teneur de 1,5 % Ni, 2,7 % Cu et 4,1 g/t de métaux du groupe du platine. Au cours de 2002, Xstrata Nickel a effectué une campagne de forage au diamant pour délimiter la ressource. L’étude de pré-faisabilité et une étude complète de faisabilité ont suivi. En s’appuyant sur les résultats de ces travaux, la compagnie a décidé de commencer à construire en mars 2004. Rick Collins, le directeur du projet minier, s’est joint à Xstrata en mai 2003. « Une nouvelle mine souterraine doit franchir des phases passablement distinctes », dit-il. « La préparation au fonçage du puits et toute l’infrastructure reliée, treuils, chevalet, services électriques et autres, prend environ un an. »

Photo courtoisie de Xstrata Nickel

mine en vedette

« Nous avons deux puits : un puits de production dont le diamètre est de 7,6 m et qui descend à 1 735 m et un autre de ventilation/sortie de secours dont le diamètre est de 6,1 m; ce dernier descend à 1 665 m », poursuit M. Collins. « Cette étape est maintenant terminée après deux ans et demi. » « La santé et la sécurité dans le domaine de la construction lourde et du fonçage de puits pose toujours des défis. Si vous me demandiez le facteur dont je suis le plus fier, je vous dirais que c’est d’avoir foncé deux puits sans incident avec perte de temps. Je crois que c’est une première dans l’industrie », explique M. Collins. Il ajoute que le développement et la construction se poursuivent depuis cinq ans, avec plus de 5,6 millions d’heures travaillées sans un seul incident avec perte de temps. M. Collins crédite la réussite du fonçage du puits à l’équipe formée d’employés de Xstrata Nickel, de Hatch-McIntosh, le fournisseur ingénierie, approvisionnement construction et gestion (EPCM), et de Cementation Canada. Il dit que la mine sera prête à temps et les coûts sont trois pour cent inférieurs au budget original. « L’approche que nous avons prise, basée sur le contrôle EPCM du projet, a été critique », dit-il. « Cela permet d’embaucher une organisation spécialisée, de n’avoir qu’un seul groupe qui applique des normes et niveaux de contrôle identiques à tous les aspects du projet. Tous ont les mêmes attentes et objectifs. » Pour s’assurer d’avoir de la main-d’œuvre malgré la pénurie mondiale, nous avons retenu certains entrepreneurs travaillant sur des parties du projet en leur expliquant qu’ils seraient invités à soumissionner sur des travaux ultérieurs. Cette approche a permis de respecter l’échéancier et comportait un avantage monétaire direct. « En donnant une grande partie du travail à un entrepreneur général, nous aurions défrayé les majorations de coûts et des frais d’administration pour les sous-traitants; nous n’aurions pas eu un prix aussi avantageux », explique M. Collins. « Par exemple, pour l’usine de remblai souterrain, nous avons accordé des contrats séparés pour les fondations et les premières structures afin d’intéresser les entrepreneurs », explique-t-il. « Nous avisions ensuite les entrepreneurs que d’autres travaux feraient bientôt l’objet de soumissions. » De manière générale, les services d’entrepreneurs et d’ingénierie obtenus selon la formule EPCM comptent pour environ 12 % des coûts d’installation. Cette formule améliore cependant grandement la sécurité, la livraison des biens en temps opportun et le contrôle des coûts. Le partenariat Hatch-McIntosh constitue un autre avantage découlant de la décision d’engager un fournisseur EPCM. Hatch est un entrepreneur EPCM à grande échelle mais cette compagnie jugeait qu’il serait mieux de confier certains services à un spécialiste. Lorsqu’elle a commencé à Nickel Rim South en 2003, cette compagnie a décidé de former une co-entreprise avec McIntosh, laquelle avait une certaine expertise de conception de mines souterraines et comprenait bien les mines du Bassin de Sudbury. Il faut noter que la mine produit déjà du minerai. À l’étape de l’étude de pré-faisabilité, l’échéancier prévoyait l’ouverture du premier chantier d’abattage au début de 2010. « C’est au moment de l’étude de faisabilité que nous avons réalisé que nous pouvions resserrer l’échéancier et ouvrir le premier chantier au deuxième trimestre de 2009 », dit M. Collins. La production avait atteint 90 000 tonnes en septembre. Les prévisions pour 2010 sont de produire 1,25 Mt de minerai à une capacité d’usine de 90 %. Par la suite, les rampes d’interconnexion seront terminées et l’installation souterraine de traitement du minerai/stérile sera prête; la production annuelle serait alors de 1,39 Mt de minerai. La durée de vie prévue est de 15 ans. « Lorsque la mine produira à pleine capacité, ce sera l’une des mines les plus automatisées au monde », dit M. Collins. Presque toutes les opérations seront contrôlées à distance : les brise-roches, les treuils, la ventilation, les communications, le remblayage, les balances, et de nombreuses autres activités d’exploitation. M. Collins cite aussi l’aspect sécurité : « Nous sortons ainsi les gens des situations dangereuses. » ICM

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supply side Do you have the strategy to maintain your sales margins?

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

❚ Jon Baird Mining is a cost-sensitive industry. This stems from the fact that our sector is a “price-taker” and not a “pricemaker.” That is to say that the value of the industry’s output of commodities is set by international markets and not by the producers. The only way in which producers can improve their bottom line is to reduce costs. Thus, there is always price pressure on suppliers, regardless of where we are in the commodity price cycle. Now that we are in the low part of the cycle, the pressure is high. Suppliers have to ensure that they have practices in place to protect their margins. All mining suppliers have been in the position of dealing with a potential customer demanding a discount. Even though you know that your product or service is worth every cent you are asking for, there is always a competitor who is prepared to cut their prices, just to get the sale. You also know that if you play the price game, you will reduce your margins and risk commoditizing your product or service, and you may never be able to regain a reasonable price level with a client to whom you have discounted. Your best defence is to have a total solution approach so that the perceived value of your offering is undeniable. Here are some suggestions. First, you have to understand the full value of your offering, with specific reference to the customer’s requirement. This is the job of your sales force — to know the customer’s situation thoroughly. Before making a proposal, it is critical to understand the business drivers of all levels of influence and decision. In your analysis phase, ask all of the in-depth questions that your customer

and your competitors may not even have thought of raising. Do not be afraid to expose the risks of your solution. If you do not, someone else will do it for you. Mining companies are interested in working with suppliers who truly understand their business.

profits and capital are slim, senior managers are more actively involved in assessing issues and their options. It is therefore important to understand how your solution affects each level of responsibility within your customer’s organization and to ensure that you effectively communicate it to them. For example, financial executives are playing central roles in setting corporate strategies. Do not leave it to your contacts in operations to translate the technical advantages of your product or service into what they mean in terms of financial impacts. Do it yourself. Lastly, to avoid margin erosion, it is important that sales commissions be linked to profit, not gross revenue. If discounting pays off for a salesperson who is simply interested in landing orders, your margins will suffer. Perhaps now is the time to sit down with your marketing and sales people and ensure that you have a strategy in place to preserve your margins. CIM

First, you have to understand the

full value

of your offering, with specific reference to the customer’s requirement. Second, your sales people have to make the customer understand what it will cost them not to adopt your solution. Often, resistance to change is a major hurdle and sales people have to be able to prove to clients that it may be costly not to change. You have to then prove to the customer that your approach will have a specific financial result, such as cutting costs or raising revenues. Such a quantitative analysis goes far beyond the simple cost of purchase. It requires knowledge of how the customer will use the product so that the total cost of use can be established. In today’s complex business world, and at this time in the mining cycle when

www.camese.org

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

November 2009 | 55

eye on business Modernizing legislation Proposed changes to the Ontario Mining Act and a new land use regime in the Far North ❚ Neal Smitheman and Tracy Pratt The Government of Ontario recently embarked on a strategy to “modernize” the mining legislation in Ontario. Proposed amendments to the Ontario Mining Act arise, in part, from criticism that the Act does not appropriately balance industry interests with those of private land owners and Aboriginal communities. Bill 173, or the Mining Amendment Act, 2009, was introduced to Parliament by The Honourable Michael Gravelle, Minister of Northern Development, Mines and Forestry, on April 30, 2009. Although the amendments are directed at promoting mineral exploration, Minister Gravelle has stated that mining activities are “encouraged” in a manner consistent with the recognition and affirmation of existing Aboriginal and treaty rights. Bill 191, or the Far North Act, 2009, was introduced to Parliament by The Honourable Donna H. Cansfield, Minister of Natural Resources, on June 2, 2009. The stated purpose of this Act is to provide for community-based land use plans (CBLUPs) in the Far North that directly involve First Nations in decision-making. The bill is designed around the concept of CBLUPs and the province’s goal of having 225,000 square kilometres of protected areas in the Far North. Together, Bill 173 and Bill 191 radically change the landscape for mining exploration and investment in Ontario. Industry participants have taken particular note of the amendments respecting Aboriginal rights and interests.

The duty to consult Bill 173 appears to be an attempt to transfer or delegate a component of the Crown’s duty to consult with Aboriginal communities to third-party resource development companies. Aboriginal rights are inherent rights 56 | CIM Magazine | Vol. 4, No. 7

that certain Aboriginal Peoples of Canada hold as a result of their ancestors’ long-standing use and occupancy of the land, including, for example, the right to hunt, trap and fish on ancestral lands. Treaty rights refer to Aboriginal rights set out in a treaty entered into between a First Nation and the Government of Canada. Both of these rights are recognized and affirmed by s. 35 of Canada’s Constitution. The Supreme Court of Canada, in a number of landmark decisions, has established that the federal and provincial Crown have a duty to consult with, and accommodate where appropriate, First Nations where there is knowledge of the potential existence of an Aboriginal or treaty right and where the Crown contemplates conduct that may affect it. Canada’s highest court has attempted to define the principles governing the duty to consult with First Nations. First, the extent of the duty is proportionate to the strength of the claim and the potential impact on it. Although the content of the duty will vary based on the facts of each situation, the duty to consult requires the First Nation also to engage in good faith consultations. The duty does not amount to an Aboriginal “veto” power over development projects. Although the Supreme Court has articulated that third parties, including mining industry participants, are under no duty to consult with First Nations, certain recent clashes in Ontario between First Nation communities and junior resource development companies may be interpreted as eroding this private third-party interest boundary. The recent proposed amendments to the Act appear to take a similar approach.

Proposed legislation Many of the proposed amendments to the Mining Act, and the introduction of the Far North Act, 2009, appear to

be an attempt by the province to legislate a framework for the consultation with First Nations that the Supreme Court of Canada says must occur. For example, the proposed amendments to the Mining Act require that an exploration plan be submitted in accordance with prescribed requirements, including prescribed Aboriginal consultation. The amendments also stipulate that an application must be made to the Director of Exploration (a newly appointed officer that does not currently exist), who will be tasked with deciding whether to issue an exploration permit and upon what terms and conditions. In deciding whether to issue an exploration permit, the Director of Exploration shall consider, among other things, whether Aboriginal consultation has occurred.1 To the extent that the amendments “download” or delegate to industry what is properly the Crown’s duty, the new legislation could be deemed unconstitutional. The proposed structure may be problematic insofar as resource companies with mining claims/leases are mandated to engage in time-consuming and expensive discussions, which could later be rendered moot by Aboriginal communities if the Crown does not fulfill its constitutional obligations. Bill 191 effectively imposes a moratorium on any new mines in the Far North (the northernmost third of Ontario’s landmass and representing an area one and a half times the size of the Canadian Maritimes) and a development moratorium on at least 50 per cent of the Far North’s boreal forests (such 1

Additional layers of regulation usually result in increased administrative costs and greater exploration expenses. The proposed legislation also lacks protective appeal mechanisms for claim holders should they face delays as a result of the new requirements.

eye on business protected areas are not yet defined). Bill 191 also creates an additional regulatory hurdle in the form of a CBLUP. Until a CBLUP is in place, no new mines can be opened in the Far North. The proposed legislation has received negative commentary from industry as being vague or ill defined. The regulations, once drafted and circulated, may provide the necessary clarity, including assurances that the Crown is an equal and committed partner to the consultation process. There also is real concern about investing in a new prospect, or an expansion of an existing project, given the Bill 191 moratorium. Aboriginal groups also have voiced criticism of the bills. First, the process for CBLUP designation requires First Nations to follow the legislative process set out by the Ontario government, a process that, ironically, was created without significant First Nations input. Second, there is concern about the residual power left to the Minister in the form of regulation-making power. Several First Nations see this ministerial discretion as an “entrenchment of

the powers of Ministry of Natural Resources and contrary to the partnership model suggested. In particular, a number of First Nations condemn the arbitrary imposition of a 225,000 square kilometre protected area, which may run contrary to Impact Benefit Agreements (IBAs) these First Nations have negotiated or are in the process of negotiating with industry. The proposed legislation, however, does require industry participants to be proactive in their contact and consultation with Aboriginal communities. This is a positive step for building better relationships between industry and First Nations. Indeed, this type of private consultation, often by way of negotiated memoranda of understanding,

exploration agreements and IBAs, has become a recent voluntary component of many mining project developments in Ontario. CIM Contributions to this article also were made by Michael Bourassa, the coordinator of Fasken’s Global Mining Group, and Richard Butler, an associate in the Dispute Resolution Group. This article is taken, in part, from a paper titled “An Attempt to Legislate the Duty to Consult with Canada’s First Nations? Proposed Amendments to Ontario’s Mining Act” by Neal Smitheman and Tracy Pratt, to be published in a newsletter of the International Bar Association. www.fasken.com

About the authors Neal Smitheman and Tracy Pratt are partners at Fasken Martineau DuMoulin LLP’s Litigation and Dispute Resolution Group, specializing in Aboriginal and mining issues.

November 2009 | 57

MAC economic commentary The results are in The key economic messages of the mining industry ❚ Paul Stothart Late summer and fall are always busy times for the mining industry on the economic policy front. Typically, the Mining Association of Canada releases its annual “Facts & Figures” report in August and also prepares a formal industry submission in advance of the meeting of federal, provincial and territorial energy and mines ministers held each fall. The federal government’s pre-budget process also starts in late summer, launched with a submission deadline set by the Finance Committee. The key messages reflected in MAC’s ministerial comments, pre-budget views and “Facts & Figures 2009” follow.

The mining industry is important to the economy The industry, as defined by Natural Resources Canada, contributes $40 billion to Canada’s GDP, employs 350,000 people, pays approximately $13.5 billion in taxes and royalties, contributes 19 per cent of Canadian exports and generates business for 3,140 supplier companies. It creates value in urban, rural and remote regions and its products are fundamental to modern life and to the emergence of clean energy technologies.

Aboriginal relations are important The mining industry is the largest private sector employer of Aboriginal Canadians. Strong mutually beneficial relationships exist between Aboriginal peoples and mining companies in the diamond, uranium, oil sands and other segments, and there is potential to further broaden these relationships. For their part, governments must invest in skills and education and must be cognizant of the Aboriginal Peoples’ desires for economic development. Government proposals to eliminate large tracts of northern land from resource development work against this desire. 58 | CIM Magazine | Vol. 4, No. 7

Times are turbulent The World Bank forecasts global growth of minus three per cent in 2009 and, like most sectors, the mining industry is experiencing turbulent times. Over the past year, the Canadian mining industry has closed or reduced operations in some 40 mines and reduced operations in 11 smelters in response to a supplydemand imbalance associated with the global economic recession. Industry spending on mineral exploration has been slashed in half — from $3 billion in 2008 to around $1.5 billion in 2009. While positive signals are being seen in the industry, most mineral prices remain well below 2007 levels.

There is a need for some tax improvements On balance, the Canadian mining industry receives fair tax treatment. The flow-through share provisions, ability to deduct capital expenditures and declining corporate income tax rates are attractive features. Beyond these measures, there is a need to encourage greater exploration to increase levels of mineral reserves in Canada. Measures such as an investment tax credit would contribute to the modernization of processing facilities in Canada and help them compete with subsidized and state-owned companies in other countries.

Governments must support economic development in many ways There is a need to streamline the processes and regulations that guide project development. In areas such as greenhouse gas emissions, there should not be federal-provincial duplication of regulatory or reporting requirements. Infrastructure must be modern and efficient and able to serve promising resource areas in northern Canada. Government investment in

geological mapping is of fundamental importance — this spending should be significant and sustained. Underpinning each of these actions is the need for Canada’s natural resource ministers and departments to actively advocate for the industry as part of their core mandate.

The future looks promising for Canadian mining companies Despite impressive growth over the past decade, many indicators suggest that China and India remain relatively undeveloped and offer staggering market opportunities for decades to come. Canada will benefit from the mineral and metal prices associated with this strong global demand. As an investment destination, Canada features low political risk, stable energy supply and a skilled mining workforce. The Canadian mining industry is diversified with strengths in oil sands, potash, uranium, gold, diamonds, nickel and iron ore, among others. This helps provide stability to cyclical commodity-specific movements. For the above reasons, Canada is likely to remain a strong and competitive producer of minerals and metals. The Canadian economy will benefit from this production and from the high prices associated with the growing demand in developing countries and resumed demand in the United States and Europe. CIM www.mining.ca

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

women in mining Blowing a hole in the glass ceiling A mining engineer looking for new ways of doing things ❚ Richard Andrews As one of Canada’s few women employed in mining explosives, Sophie Bergeron, a mining engineer at Xstrata Nickel, is a booming success. “Blasting is fun,” says Bergeron, “especially when you get good results. I was really happy with our last test at Raglan where we blasted a really big stope with 25,000 kilograms of emulsion explosive.” The correct use, placement and choice of explosives is a specialized skill, and during a student internship, Bergeron found she had the right stuff for the job. “We didn’t learn a lot about explosives at university, but I was encouraged by a really good boss at Dyno Nobel and found I was really interested in this aspect of mining.” It’s tempting to speculate on the early origins of such an interest, but Bergeron denies simulating mining explosions in the sand pit. “My childhood games were the usual ones. I played with Barbie dolls as well as Lego, Transformers and GI Joe. I liked many different sports and activities. At school, I was good in math and it became clear that engineering was the way for me.” After graduating from the École Polytechnique de Montréal in 2000, Bergeron joined Xstrata Nickel’s Raglan Mine, in northern Quebec’s Nunavik region, where her skills were put to good use. “There were some issues with production in one open pit and we worked a lot on improving blasting techniques. After a few projects, I became the ‘go-to’ person for explosives.” Bergeron spent seven years on rotation at Raglan, including two years as

an underground supervisor. During that time, she also trained as a mine rescue officer. “I wanted to be able to act if something happened while I was on site. I don’t like to sit around helplessly. There were not many engineers in the mine rescue team and I felt it would be useful to have a member with technical knowledge of the mine. At first, I wasn’t sure if I’d be able to carry heavy equipment such as the BG4 Mine Rescue Rebreather. However, I could, and I got my certificate.”

There’s no doubt Bergeron established her credentials at Raglan, but what was it like at the beginning for a young woman to be flown into a remote, male-dominated mining site? “The people at Raglan were really fair with women. The gender issue came up, but not a lot,” she says. “I had worked a previous summer as an underground scooper and truck operator. Knowing the job from the ground up helps when you’re new. I also knew how to work well with the guys. You don’t have to be friends. So long as you respect each other, it all goes well. However, I’m also aware that if you want to advance your career in a man’s world, you probably have to shine a bit more — not just in mining, but in many industries where there are few women.” Bergeron believes the mining industry is changing, and Xstrata is one of the progressive leaders, having hired many professional women in the past few years. Acknowledging her skills and broad experience, the company has promoted the engineer to be Raglan’s first superintendent of continuous improvement. “It’s a big challenge,” she says. “To keep Raglan competitive in tough economic times, my mission is to find ways to decrease the cost of production by taking greater advantage of opportunities and getting people more involved in the big picture. You could say my job now is to blow apart the cost structures and find new ways of doing things.” CIM November 2009 | 59

HR outlook Training is key Skills development and the Aboriginal community ❚ Sheldon Polowin An insightful 2007 report by the Standing Senate Committee on Aboriginal peoples entitled “Sharing Canada’s Prosperity: a Hand Up, Not a Handout” has attracted much attention from governments, advocacy groups and the general public. It reveals that perhaps more than any other group in society, Aboriginal Canadians require appropriate academic training in order to sustain their economic livelihood. For various cultural, socio-economic, political and other reasons, Aboriginal Canadians have generally found it difficult to take full advantage of the educational opportunities that would enable them to find steady employment. The Senate Committee noted that a deficiency of human capital, particularly in basic skills, has impeded the development of a more adept Aboriginal workforce. Perhaps for this reason, technical and on-thejob training specifically targeted at the Aboriginal population has been the focus of attention in recent years. The Canadian government has recently sponsored new projects in essential skills training through the Aboriginal Skills and Training Strategic Investment Fund (ASTSIF). The initiative finances short-term projects to help Aboriginal workers develop the skills necessary to improve their marketability and potential utility in the workforce. The most important of these at the federal level is the Aboriginal Skills and Employment Partnership (ASEP) program, which uses a holistic approach to provide technical training to those employed in the natural resources sector. The multi-stakeholder partnership includes federal and provincial governments, the private sector and Aboriginal community organizations. A notable feature of the Aboriginal Skills and Employment Partnership 60 | CIM Magazine | Vol. 4, No. 7

(ASEP) program is its requirement that, in return for the training it provides, recipient organizations must guarantee at least 50 long-term, fulltime jobs. Thus far, mining-related ASEP projects have primarily involved the development and production stages of the mining cycle. The exploration sector, which offers many part-time, seasonal employment opportunities, has received less attention. However, ASEP projects may include Aboriginal Human Resources Development Agreement (AHRDA) participants. AHRDAs provide social assistance and other services to Aboriginal trainees through various funding agreements with Human Resources and Skills Development Canada (HRSDC). At present, there are two ASEP projects in northern Ontario — the Whitefeather Forest ASEP (Pikangikum) and the Matachawan Aboriginal Access to Jobs Strategy project (Matachawan). The role that essential skills play in one’s intellectual development and ability to contribute to society cannot be overstated. HRSDC has identified the following nine essential workplace skills: reading, document use, numeracy, writing, oral communication, working with others, thinking, computer use and continuous learning. Although the importance of these skills is indisputable, they are insufficient to enable one to perform well on the job; they must be supplemented with appropriate technical training and on-thejob experience. The mining industry affords Aboriginal youth the opportunity to acquire academic training while working in the field. The industry can encourage greater Aboriginal

employment by offering co-op placements at mine sites. They help those entering the workforce to refine their basic skills and acquire more advanced technical capabilities. This practical, skills-based exposure provides the foundation for long-term career success by giving individuals hands-on experience and providing networking opportunities. Many employers prefer workers who have acquired some experience through internship or work-study programs while in training. Recently, the Canadian Aboriginal Minerals Association (CAMA) hosted its 17th annual conference in Toronto. The participants reflected upon the academic achievements of Aboriginal youth, and questioned whether they will be able to fully participate in the economic recovery expected in 2010. The ASEP and other similar programs are designed to help them achieve this objective. Developing the skills necessary to have a successful career in any industry is a challenging and multi-faceted process. This is particularly true in the mining industry, which requires a diverse set of skills. The ASEP program exemplifies one approach that has assisted members of the Aboriginal community by increasing their marketability and skills in preparation for a career in mining. CIM www.mihr.ca

About the author Sheldon Polowin is program manager, research and labour market information. at MiHR. He is responsible for supporting the development of the national Mining Industry Workforce Intelligence Network system by conducting economic research and analysis and developing labour market forecast models. spolowin@mihr.ca

first nations Online resources for industry and First Nations in Ontario ❚ Juan Carlos Reyes With 127 Indian and Northern Affairs Canada (INAC) recognized First Nations in Ontario, it is almost certain that the need to consult and accommodate will be an important topic to most mining developments or acquisitions. The goal of this month’s column is twofold — I want to share some information and tools that could be useful when you are looking at your property, and I want to emphasize some of the resources that are available to First Nations communities to help them find out who’s digging in their back yard. Keep in mind that there could also be some level of Ontario First Nations map Metis interest in your territory, even though I have only seen strong mend fences years later because they Metis involvement in the Manitoba neglected to engage one of the comregion. In most cases in Ontario, munities in their discussions. Often industry deals with First Nations, there is no easy way to identify which since it is these communities that have community you should be talking to. land treaties. Nevertheless, it is still critical to at Companies with property in least attempt to bridge this gap. Ontario need to quickly identify A useful tool for companies to help whether or not there are any identify First Nations communities in Aboriginal interests in the territory. Do Ontario can be found at http://communot rely on the provincial government nities.knet.ca. This website allows you to determine these interests and initi- to determine which communities are ate discussions, because history shows near your property and to obtain releus that process happens very slowly. If vant contact information. It might be a you have property and are serious good idea after you have identified about its development, then you these communities to arrange a visit should be equally interested in com- with the Chief. From my experience, municating openly with the surround- most Chiefs appreciate this and see it ing communities. as a welcoming opportunity. In some cases, the land in question For exploration or mining to take might be shared by more than one place, a company (or community, and you might at times individual) must file a have to deal with two or three First formal “claim” with the Nations, all of whom hold portions as provincial government. their own traditional territory. It is To aid First Nations important not to take sides by choos- communities to keep ing to deal with one community over track of the activity another. There are indeed cases in going on in their terriwhich companies are still trying to tory, the Ontario

Ministry of Northern Development, Mines and Forestry has created a map that tracks claims (www.claimaps.mndm.gov. on.ca). Although not as userfriendly as Google maps, it does offer a tutorial for new users and has the capability to show any claim in your region. The ministry also tries to provide quarterly claim maps to all First Nation communities with mineral sector activity in their area. The Cree region of Quebec has mapped out its territory using their traditional system of trap lines. If you want to carry out development in their territory, they have a website (www.cmeb.org/geoeco) that not only indicates which communities you need to talk to, but also the owner of the trap lines and their contact information. This site should probably serve as a model for how other grand councils should map out their territory. In a perfect world, all the treaty land entitlement claims would be resolved, and carrying out exploration activities in partnership with First Nations communities throughout Canada would be as easy as it is to work in the Cree region of Quebec. In the meantime, using the above information and resources will get you started on the path to a successful partnership. CIM www.learning-together.ca

About the author Juan Carlos Reyes is an Aboriginal consultant with efficiency.ca and the organizer of Learning Together. He is passionate about human rights and works tirelessly to help improve the lives of Canadian Aboriginal people. November 2009 | 61

Improving long-term sustainability Research in mining and the Canada Mining Innovation Council ❚ Alicia Blancarte Finding mineral resources, mining them and extracting the values within are all technology-intensive endeavours. Innovation supports our industry by developing new technologies that produce efficiency and safety improvements; address current and emerging challenges, including environmental issues; and produce the step changes needed for continuous evolution. As mineral resources are found at increasing depths and at lower grades, as water and energy become limiting in some regions, and as energy costs rise and public demands for environmental protection increase, mining companies need to continuously innovate to remain competitive and to improve their long-term sustainability. The mining industry in Canada has a long tradition of innovation in geology, mining and processing. New and redesigned processes as well as new techniques and equipment have been developed in-house using both public and private research capabilities. Three things are changing that require a new approach — capacity, cost and complexity. Research capabilities in Canada, both in the public and private sectors, have decreased — large industrial research centres have closed, experienced university researchers are retiring, and mining and metallurgy programs are competing with other fields to attract talent. Additionally, the cost of research continues to increase as more extensive installations, equipment and experimental setups are

required. This is directly linked with the increasing complexity of the problems and topics under investigation that require a multi-disciplinary approach. As well, because of cost and complexity, companies’ in-house or self-funded research tends to be more narrowly focused on those areas that are proprietary, or have a direct impact on the companies’ functional expertise and operations. Supporting and enhancing research efforts is needed to ensure Canada continues to innovate, and to develop highly qualified people for the exploration and mining sectors. Pre-competitive research is an area where there is opportunity for collaboration. Some of the most exciting research is taking place in this space. However, collaboration is not a self-starting proposition; rather it requires facilitation, communication and incentives. The Canada Mining Innovation Council (CMIC) has been established as a network of industry, government and academic leaders working collectively to enhance the competitiveness of a responsible mining industry through excellence in research, innovation, commercialization and education. The Pan-Canadian initiative developed by CMIC represents an opportunity to gather support in expanding research and innovation, engaging industry to ensure that research is relevant and applicable, and meeting industry’s needs now and in the future. Incremental improvements and breakthrough innovations require long-term investments, and collaborative efforts

About the author Alicia Blancarte is the executive director of CMIC. As a professional engineer, she has practiced engineering in Canada and overseas in the mining, chemicals, oil and transportation sectors. Her areas of expertise include mining, environment and sustainability, and her interests include intelligent design, change and organization management, knowledge integration and technology transfer.

innovation can ensure resources are applied more effectively to both areas. Moving forward, the goal is to create a Canada-wide system that can serve the interests of industry, academia and government. One would argue that the benefits of innovation are expansive and benefit the country as a whole by creating a more competitive and responsible industry sector and a stronger tax base. Through innovation, the benefits derived from our natural resources are maximized, creating opportunities for exports in technology and innovation, attracting and retaining talent, and strengthening our institutions, to name a few. Clearly, shared and overlapping interests create an opportunity for CMIC to facilitate and catalyze the development of industry-supported projects that advance deserving research ideas and maximize the effectiveness of government funding. This can create a cascading effect of collaboration, talent development and retention, innovation and improved public perception, all leading to a more sustainable mining industry. As an impetus to this potentially positive research effort, CMIC is working on a three-pronged strategy comprised of: • Improved access to funding • Generation of new ideas • Cultivating new research capacity

The next few months will provide an opportunity to meet with key highlevel executives from industry and academic institutions, to inform them on the initiative, elicit their ideas, priorities and support, and invite them to become active members of the network. From discussions and workshops with the academic sector, industry and industry associations, CMIC will work on advancing our

strategy around three priority areas: tailings, energy and deep exploration. Stakeholders will be able to stay up-to-date on CMIC’s activities through a website currently being developed and hosted by CIM and through regular contributions to publications and conferences. CIM For more information, contact cmic@nrcan.gc.ca

Supporting tactical actions include: • Directing existing resources to needs and priorities by streamlining access to existing funding, and working on developing new sources of leveraged funding for industry-supported projects. • Creating opportunities for needs and priorities analyses by engaging industry and academia through workshops and other interactions that generate new research ideas. • Working to catalyze researchers’ partnerships, to create cross-disciplinary think tanks and interactions that can lead to the creation of new project teams, and eventually to the development of virtual or real centres of excellence in processing, mining and exploration. November 2009 | 63

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parlons-en L’acceptabilité sociale des projets : une responsabilité partagée ❚ Robert Giguère De nombreux défis attendent l’industrie minière : défis environnementaux, défis de productivité, défi du renouvellement de la maind’œuvre, défis de découverte de nouveaux gisements. Mais le plus important d’entre tous est sans doute celui du développement durable, dans son sens premier, car il englobe l’ensemble des préoccupations de l’industrie, des gouvernements et de la population. On confond trop souvent développement durable et environnement. Certes l’environnement est une composante très importante du développement durable, mais deux autres piliers du développement durable doivent aussi être pris en considération : le volet économique et le volet social. Les sociétés minières et les instances gouvernementales comprennent ce qu’est le volet économique. Depuis des décennies, en effet, les paramètres économiques sont utilisés pour mesurer le progrès humain, le progrès des compagnies, la rentabilité des investissements. Le volet environnemental répond aux énoncés et aux règles scientifiques de la chimie et de la physique. Au fil des ans, des expertises plus pointues se sont développées et des innovations importantes sont venues modifier notre relation à l’environnement. La prise en compte du volet social, par contre, est relativement nouvelle. Le volet social est un concept qui fluctue : limites floues et impératifs en continuels évolution. Les travaux récents du groupe de travail sur l’acceptabilité sociale des projets, pilotés par la Conférence canadienne des ministres de l’Énergie et des Mines, amènent un éclairage intéressant sur ces questions. Le groupe de travail a identifié trois facteurs qui conditionnent

l’obtention de l’approbation du public. Premièrement, les gouvernements et l’industrie doivent être capables de démontrer les améliorations apportées tant au niveau réglementaire que sur le plan des mesures volontaires. Les gouvernements doivent donc instaurer un régime de mesures efficaces et crédibles dans leurs champs d’interventions. Un tel régime inclut nécessairement un régime où il y a un partage équitable des avantages économiques. Les associations industrielles peuvent concevoir et consolider des programmes volontaires. Par exemple en introduisant des procédures de diffusion publique de renseignements sur les progrès réalisés par les sociétés qui pourraient être vérifiées par des tiers. Deuxièmement, l’établissement de communications crédibles et vérifiables. Le public exige des gouvernements et de l’industrie qu’ils diffusent en temps opportun des renseignements complets et crédibles. Il s’agit donc pour nous, acteurs du développement minier, de mettre sur pied de tels procédés. De plus, nous évoluons dans un contexte où le public accorde de moins en moins sa confiance aux acteurs de la société. Les gouvernements et l’industrie ne peuvent plus présumer que les intervenants accepteront une information produite unilatéralement. Le public sera nettement plus enclin à soutenir les démarches de production de renseignements qui font appel à de multiples intervenants, particulièrement

là où l’information est vérifiée par des tiers indépendants. En dernier lieu, établir de solides relations axées sur la recherche d’avantages mutuels. Afin d’améliorer l’image publique d’une industrie et d’aider cette dernière à obtenir l’approbation publique pour exercer ses activités, les gouvernements et l’industrie doivent tenir compte d’une large gamme d’intérêts, et non simplement de ceux de l’industrie. Les secteurs qui réussissent à contrer les perceptions négatives des citoyens établissent des plateformes à intervenants multiples qui contribuent à promouvoir à la fois le dialogue et la résolution concertée de problèmes. Comme le souligne une grande leçon tirée de l’expérience du secteur forestier, il est capital d’établir en tout temps des relations à la fois avec les partisans et les détracteurs des projets. En effet que la conjoncture soit favorable ou non, le maintien d’un dialogue permanent constitue un impératif de progrès. Le défi demeure donc de savoir conjuguer les trois volets du développement durable dans nos discours, bien sûr, mais d’abord et avant tout dans nos réflexions, nos planifications afin que ces trois volets se traduisent en actions concrètes. L’exercice est toujours périlleux, plein d’embûches et pose des défis importants à relever, mais il est nécessaire afin que tous y trouvent leur compte. ICM www.mrnf.gouv.qc.ca/mines/index.jsp

L’auteur Robert Giguère travaille au Ministère des ressources naturelles et de la Faune depuis 2004. Il a y a occupé, pour le Secteur énergie, la direction des politiques et de la coordination, réalisant entre autres la Stratégie énergétique du Québec. Depuis 2008 il agit comme Directeur des politiques de la coordination et des affaires intergouvernementales au bureau du sous-ministre associé au Secteur des mines ou il a coordonné la réalisation de la Stratégie minérale du Québec. November 2009 | 65

safety One steel-toed step at a time Xstrata Copper’s Kidd Mine steadily improves its safety performance

66 | CIM Magazine | Vol. 4, No. 7

A supervisor reviews a Neil George Safety Card with one of his employees.

British Columbia and integrated in Xstrata’s Australian operations, is organized around workforce engagement. With PASS, says Semadeni, “you are constantly trying to promote the positive side of what people do everyday to make their workplace

safer. Workers meet before every shift to talk about what went well the day before and what could be done better.” The same assessment moves up the chain to supervisors, who also meet for similar discussions. “It forces a healthy discussion and self-

Xstrata Copper Kidd Mine Site Stats Total Recordable Injury and Frequency Rate per Million Man Hours (to Sept. 09)

30 27.7

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Earlier this year, Xstrata Copper’s Kidd Mine near Timmins, Ontario, celebrated 3.3 million work hours without a lost-time incident. In 2008, the mine had already won a John T. Ryan award for the best safety record at an eligible Ontario metal mine, with a modified work injury frequency of 0.54 per 200,000 work hours. This latest achievement brings it closer to its target of becoming one of the safest in its class across the country. “Last year was a big story for us,” says mine manager Tom Semadeni. “We had an incredible improvement in safety at a mine that was already pretty safe.” Those charged with safety at Kidd regard their progress as the consequence of steady, conscientious effort. “In 2004, we introduced the zero acceptance program,” explains Rick Farrell, the elected safety representative who advocates for roughly 600 permanent non-unionized workers at the mine. “We all agreed — workers and management — that no one would continue working if a substandard condition or action existed.” Over the next couple of years, worker engagement was encouraged with a “stop-and-correct” initiative. Later, emphasis was placed on which safety issues could be addressed by individual workers and which must be addressed by larger groups. Each of the 39 frontline crews at the mine has a health and safety representative. Twice a year, worker and contractor representatives, supervisors and superintendents meet off-site to spend a day discussing workplace safety. One step up, Farrell is one of three divisional worker representatives who meet each month with a management counterpart to review performance and steward new programs. Two years ago, reinforcing the zero acceptance program, Kidd Mine repatriated the Positive Attitude Safety System. The PASS process, created in

Photo courtesy of Xstrata Copper

❚ Ryan Bergen

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safety evaluation of safety preparedness,” says Semadeni. The success of such programs is largely determined by the entire operation’s commitment to them. Farrell stresses that everyone at the mine has held fast to the principles of PASS. Last fall and this spring, the entire mine took safety pauses, says Semadeni. “We stopped production for four hours and the crews participated in safety workshops. This was a clear demonstration of commitment.” Grassroots engagement is complemented by top-down, corporate-level programs, explains Semadeni. “Xstrata has a strong sustainable development philosophy and that is backed up with a very high level of governance.” Safety, he explains, is one of a broad range of standards meant to ground the philosophy in day-to-day operations. “We get audited on those standards each year with strict criteria and high expectations.” Those expectations carry over to the many contractors whose workforce can at times nearly match Xstrata’s. No contractors begin work at the mine without first presenting their safety systems to the health and safety department to demonstrate

that they have adequate measures in place. Those with large work crews must be prepared twice a year to ensure that they are meeting expectations and to present their safety improvements. This year, says Barry Federchuk, the mine’s safety superintendent, they have focused on training the workforce to recognize risks and hazards and on putting controls in place to address them. The Kidd Mine has long used the Neil George, Five-Point Safety System and recently modified the cards used in the system to include risk assessment. The revamped safety card asks workers to identify hazards associated with their tasks, to list safety controls and to rank the risks they have identified. To ensure the card was well-adapted to the workers’ needs, hundreds of questionnaires were circulated to gather feedback. As a complement to the revised Neil George system, the mine also recently added a full-time risk coordinator to its safety department. With so much going right, it is not surprising that Farrell doesn’t hesitate to go out on a limb. “This year we’re going to win the national trophy.” CIM www.xstrata.com

Moving on up Alberta-based oil junior Action Energy Inc. appointed Maria Elliott to the position of CFO and vice-president, finance. Elliott, who previously held the position of controller at the company, is a certified general accountant with over 10 years of finance, management, and public company reporting in the oil and gas industry. PricewaterhouseCoopers announced that Normand Champigny joined its Mining Centre of Excellence in Canada. Champigny, a geological engineer with 30 years of international mining industry experience, has worked with leading international consulting organizations on a wide range of mining projects. He is a director of the Prospectors and Developers Association of Canada, vice-president of Fonds Restor-Action Nunavik and a member of several provincial professional orders. Graham Dickson has been appointed a director at Monument Mining Ltd. Dickson, who has over 25 years of experience in the gold mining industry, has built numerous gold treatment plants in remote areas of the world. In the past, he served in various senior management capacities with BYG Natural Resources Ltd. and oversaw the development of milling and mining facilities for Cominco Ltd., Bond Gold, Claude Resources and Bema Gold. Dickson currently serves as COO of Yukon-Nevada Gold Corp. November 2009 | 67

engineering exchange Building inside the beehive Communications and training drive Hatch’s success at Escondida Norte

Photo courtesy of Hatch

❚ Heather Ednie

Intermediate ore bin between the primary crusher and overland conveyor

To complete any major construction project on schedule and within budget demands broad expertise and extensive coordination. Hatch, the engineering, procurement and construction manager (EPCM), met that standard when it finished the full ramp up of BHP Billiton’s Escondida Norte and E3 Project east of Antofagasta, Chile, in October 2005 — and along the way, it raised the bar. “The unique challenge was constructing a new project within an existing operation,” says Gerardo Reveco, Escondida Norte project manager for Hatch. The initial project involved the design, construction, and ramp up of a new primary crusher station, seven-kilometre overland conveyor, distribution conveyors, and surge and distribution silos. The new materials handling system was designed to deliver up to 8,800 tonnes per hour to the existing Escondida process facilities from the new pit, located seven kilometres north of the existing one. The scope of the project later grew — added to it was the creation of the E3 conveyor pushback, consisting of the 68 | CIM Magazine | Vol. 4, No. 7

construction of two parallel 1.2-kilometre conveyors, the extension of several existing conveyors and two 10-day tie-ins. Even before ground was broken, Cesare Celle, regional managing director, Latin America, recalls, “Coordination was a real challenge. To start excavation and construction, a lot of permits were required, and a lot of safety requirements had to be addressed. BHP Billiton has very strict safety protocols, so we had to be very diligent working within the operation.” With all the pre-construction preparatory work done, executing the project then depended on attention to the cascade of details and the thorough training of the workforce in everything from traffic control to safety. At the peak of construction, Reveco says the project staff nearly doubled the staff from ongoing operations. And traffic control on site became a major task. “We had a group of people designing and redesigning the traffic flow on a weekly basis.” The key to success, he says, was communication, and the Hatch team became experts at it. “We had to coordinate with two groups: the operators in the concentrator and those in the mine — and they often had different priorities. The logistics to coordinate shutdowns and have all managers in agreement were challenging.” From emailing to door knocking and wielding whistles, they applied whatever tool matched the task to ensure everyone knew what was going to happen. They also learned the value of repetition, especially when it came to the principles of safety. “The messages must be repeated so they remain a priority,” says Celle. The Hatch team got innovative when it came to training. An 11-day shutdown was planned for the relocation and reconnection of the conveyor systems between the mines and distribution centre. In preparation, Hatch

Photo courtesy of Hatch

engineering exchange

Primary crusher station

developed training videos for every contractor onsite. By incorporating 3D models, photos and videos, they simulated the situation that a specific contractor would be dealing with during the move. Driving courses taught workers the special signals that would be used on the road during the project, explains Celle. “The contractors were able to sit down and learn their task, the sequence of events and what to expect. This way, they were much more prepared when it came to the actual shutdown.” The training efforts paid off. In the end, the planned 11-day shutdown was completed within less than half of that time, allowing an extra six days of production — that’s money in the bank. As the EPCM manager, Hatch was committed to creating benefits for their clients. Through value engineering, they enabled the client to save money. The development of a materials distribution centre — including moving the conveyors farther from the pit — accommodated feed from both the original and new Escondida pits. Two silos were erected onsite, and product was brought in by conveyors from the new pit to be redistributed between two concentrator sites. “Through the relocation of the conveyors and creation of the distribution centre, we created a flexibility that allows for better interaction between the two pits and the two concentrator facilities,” Celle says. “That project alone saves the client several millions in operating costs.” Celle highlights that Hatch has enjoyed a long-term relationship with BHP Billiton, which has led to the two groups really understanding each other today. “We enjoy a synergy from repeat business,” he says. “We have a good understanding of their definitions of scope, capital budget and scheduling — we know how to work with the BHP group. And this leads to strong safety, design, budget and

Mine shovel at construction site

scheduling performance — the cornerstones of successful project management.” CIM www.hatch.ca

Postdoctoral Fellowship in Mining Engineering The Mine Design & Numerical Modelling Laboratory at McGill University invites applications from prospective and recent PhD graduates for an NSERC University-Industry Postdoctoral Fellowship. Applicants should hold a degree in mining or closely related field and must have outstanding academic record. Underground mining experience would be considered an asset. The research project offers industrial training in rock mechanics, numerical modeling, underground mining, and risk analysis. Excellent written and oral communication skills are required. The Fellowship is available effective immediately for a period of one year, renewable once. Interested candidates should submit their CV and transcripts to: Professor Hani Mitri (Hani.Mitri@McGill.Ca) McGill University, 3450 University Street Montreal, Quebec, Canada H3A 2A7 November 2009 | 69

standards A progress report Recent amendments to NI 43-101 ❚ Deborah McCombe and Craig Waldie National Instrument 43-101 Standards of Disclosure for Mineral Projects was implemented on February 1, 2001, and amended on December 30, 2005. It is meant to be a living document that is revisited and revised from time to time to reflect changes in the industry. Since its conception, a number of issues and concerns have arisen. In response to these, in January 2009, the Canadian Securities Administrators (CSA) launched a project to revise NI 43-101. The CSA initiated a consultation process in the spring of 2009. Approximately 150 professionals — including issuers, consultants, lawyers, analysts, self regulatory organizations and stock exchanges — participated in focus group sessions in British Columbia, Ontario and Quebec. Feedback from the participants was reasonably consistent on many issues. At the CIM Toronto Branch luncheon last June, Craig Waldie and Jim Whyte of the Ontario Securities Commission summarized the initial results. It was noted that these are only conceptual changes at this time. The revisions to NI 43-101 are expected to be submitted for a 90-day public comment period in the summer of 2010, with a proposed effective date of summer 2011. Areas identified for potential revisions include the following: Updated consent of QPs. Does the rule currently place too much responsibility on the Qualified Person (QP) and not enough on the issuer? Should updated QP consents be required if the existing technical report is still valid, or could this requirement be eliminated? The rule should reflect the fact that the issuer’s management has a responsibility to determine if a technical report is still current, or if a new one is needed. 70 | CIM Magazine | Vol. 4, No. 7

Technical report triggers. Should a production decision trigger a technical report or should there only be a requirement to disclose that the issuer went into production without a study to support the project’s economic viability? Technical report triggers need to be reassessed to make sure they are the right ones. Should the trigger revert back to the original wording of “any written disclosure”? A news release containing initial disclosure of a mineral resource, reserve or preliminary assessment currently triggers a technical report. Historical/previous estimates. Are broader and more flexible rules required for disclosing previous mineral resource and reserve estimates? How is it best to handle previous CIMcompliant estimates or an estimate that conforms to UN, Russian or Chinese systems that may not be “historical”?

mineral estimates using a CIM-style reporting standard, is this a good basis for allowing in-house reports? Also, should technical reports on producing properties be exempt from including an economic analysis section? Technical report form. Should it be possible to incorporate more information in the technical report by referencing previous reports? The technical report form needs to be amended for development and production properties. Should there be a separate form for technical reports on development or production properties? Foreign associates. The list of accepted foreign professional associations and designations should be updated and a mechanism provided to allow for future revisions of the list. CIM http://www.cim.org/committees/CSACIMQuestions_April_14_2008.pdf

Preliminary assessments. Should the rule be more flexible and allow the disclosure of a preliminary assessment on advanced stage projects? NI 43-101 does not allow an issuer to disclose a preliminary assessment on a project after a pre-feasibility study. Reliance on other experts. Could the QP rely on and disclaim responsibility for information by a non-QP expert if the QP explained what was done to verify the information and why the expert should be relied upon? A clarification of the difference between “reliance” and “disclaimer” is required. Producing issuers. Should producing issuers be allowed to file in-house technical reports when they become a reporting issuer? If foreign issuers already trade on a designated exchange and report

About the authors Deborah McCombe, executive vicepresident of Scott Wilson Roscoe Postle Associates, is a consulting geologist strongly involved in Canadian disclosure standards for the mining industry. Craig Waldie, senior geologist with the Ontario Securities Commission, is responsible for technical reviews of mining and exploration companies’ public disclosure and technical reports for compliance with NI 43-101.

student life New to this An Irishman from Germany who is studying in Quebec learns the ropes in Ontario ❚ Michan Condra Many people find it hard to understand why I chose to study mining engineering at McGill University — myself included. An Irishman from Germany, I originally came to Quebec on a high school exchange program and stayed on to complete my CEGEP in Arts and Sciences at Marianopolis College. I cannot honestly claim to have known much about mining at all. On reflection, I think I chose this domain to satisfy my innate sense of adventure and curiosity Geared up for a day of work while opening up a world of opportunities for myself. Being 6’4” like all the other miners, I had to in height, I have often been told that attend daily safety meetings, comply I’m too tall to be a miner. I can guess at with the five-point safety system for why this may be the case, but I can’t underground work, and be responsisay I was sure I knew why height ble for my tasks being executed safely. could be a disadvantage. It would take too long to describe all Fortunately, the representatives that I saw and learned, but if I had to from Goldcorp’s Musselwhite Mine choose some of the most important who came to interview me in the sec- knowledge gained, I would highlight ond week of classes were not outraged the following. to hear that I knew next to nothing First of all, I now have a better about the industry of my future career. idea of the scale of operations in a I like to think that my honesty and mine. It is no easy feat to move so apparent will to learn is what con- much material. I also learned about vinced them to offer me a summer the complexity of working underposition as an underground helper at ground at a remote camp. There are their fly-in/fly-out, 4,000 tonne-per- so many ways in day gold mine in northwestern which any task can Ontario. hit a snag, even if it I had thought that I would not be is only because the trusted to do more than observe and cross-shift did not stay out of the way. However, after a return something week of intense training, with a to the right place. strong focus on safety, I was put to Even the smallest work with the boom truck operator. jobs require planAs my two-week rotations and 12- ning and dialogue hour shifts progressed, I got the with colleagues. opportunity to work with the long- One has to secure hole explosives loader, the service access to the right crew and the crusher operator. Also, supplies in the

right place while not affecting anybody else’s job. Somebody once told me that “the miner is the softest thing underground.” Now, I realize that this is a reminder of the importance of safety — the most important consideration of any mining-related activity. Goldcorp’s take on safety is that they would like to make the workplace “safe enough for our families.” I have a feeling that some miners have a low opinion of engineers because they think that they sit in cozy offices and lack insight into the actual work that is done underground. As far as I am concerned, I believe that this workterm has been an essential part of my education and I am very thankful for the opportunity to experience handson reality at Musselwhite Mine. I could not even imagine how to continue studies as a mining engineer with my previous level of oblivion towards the job and the huge emphasis the mining industry places on safety. I would like to encourage students to search for a practical job as a work term because without it you may just remain “new to this.” CIM

About the author Michan Condra is a second-year mining engineering student at McGill University. He is a recipient of the R.P.D. Graham Scholarship and the Mining Engineering Entrance Scholarship. His first work term was at the Musselwhite Mine in Ontario and he hopes that his subsequent ones will take him all over the world. He wishes to eventually focus on the environment and giving back to the planet. November 2009 | 71

canadians abroad The social chemistry of mineral processing Two Canadian engineers learn that in the Amazon Basin, there’s more to getting it right than just technical know-how ❚ Ryan Bergen As members of a team of engineers from Teck’s subsidiary, CESL Ltd., Jennifer Defreyne and Kevin Murray, were drafted by Vale (formerly CVRD) to go to Brazil because they knew the technical process of refining copper from sulphide concentrates well. Their job was to explain the process to their Brazilian hosts, who would run Vale’s hydrometallurgical facility in Canaã dos Carajás once the plant was operational. However, on the outskirts of the Amazon Basin, hours from any major centre and a couple days from any English-speaking city, they discovered that they had much to learn before their knowledge could bear fruit. In addition to intensive Portuguese classes, recalls project leader Defreyne, “we had a consultant talk to us about some of the differences in culture. To just listen to those differences is one thing; to fully understand what those differences mean in a working environment is totally differ- Back, left to right: Kevin Murray, Anthony Molinaro, Grant Moenting, Al LaRocque, Brian ent.” She made numerous month-long trips to Melo, Robert Bruce, Jacob Russell, John MacIntosh, Paola Zucolli; kneeling: Jennifer Canaã dos Carajás in Brazil’s Pará state during the Defreyne and Norman Hayton commissioning and start-up stages of the project. “You don’t get anything done if you don’t have a good It was one of the many lessons that Murray and his wife, relationship with the people you are working with,” who accompanied him with their two-and-a-half-year-old explains Murray. It may sound like a management consul- son, learned after they went to Brazil on short notice. tant’s pep talk, but he means it literally. Defreyne offers an They felt like pioneers in Canaã, a town of about 15,000 example. “I can think of vendors from other countries, people. Opening a bank account took months. Power outages, who came in and were just expecting to get right to work particularly during the rainy season, happened frequently. A without going out the first couple of nights to have a drink day-long blackout after a big grocery shopping trip quickly and get to know everyone. It can take them a long time to taught them — with servings of melting ice cream and hamlisten to you technically if you are not their friend first.” burgers for breakfast — a different approach to home ecoDefreyne accepted the social challenge happily. Now, she nomics. At the plant, outages were less of a problem but roads counts Brazilians among her closest friends. As well, with- were often washed out, choking off the supply of oxygen out cable TV, movies or other passive entertainment, she has needed to sustain the processing of copper concentrates. rediscovered the pleasure of conversation with her Canadian As CESL’s role in the project is wrapping up, Murray says housemates. “There were times when we would stay up all he has enjoyed his 10 months in Canaã and has come away night just talking. You don’t do that in Canada anymore.” from the experience wiser. Defreyne expects to make a final As a small group of consultants, the CESL team refused trip to Canaã this month and is already trying to line up a to remake their hosts — who seemed to be time-insensitive placement at Teck’s Andacollo copper operation in Chile. — in their own image. They learned to follow the chain of The move from relatively progressive Brazil to Chile, where command to avoid stepping on anyone’s toes, and to negoti- she expects she might confront workplace machismo, will ate what Murray describes as a more “fluid” appreciation of be a challenge, but she’s up to it. “You have to show your time. “It seems that three in the afternoon can mean any- technical knowledge and your experience a little bit more. thing between three and five.” In time, Murray adapted to Sometimes, they are a little surprised that you are actually an the local style of meetings. “You have to socialize a bit, try to engineer and not an administrator, but once they find that find out what the person you want to talk to is doing, and out, they are very respectful.” CIM have somebody come and get you when they eventually www.teck.com www.cesl.com show up for the meeting.” 72 | CIM Magazine | Vol. 4, No. 7

Private company, public resource The Inco Triangle archives are home to a rich collection of historically important documents ❚ Ryan Bergen “I hope my comments won’t seem picayune, but Inco’s history is an integral and important part of our heritage in the Sudbury Basin. As with any locale, I suppose, some local legends have been embellished a little over time.” — Marty McAllister, in a 1989 letter advising a correction in the Inco Triangle

wenty years after his first dispassionate contribution to the Ontario division of Inco’s nowdefunct community news magazine, Marty McAllister no longer bothers to mince words. “If a magazine could be a legend, that one was,” he declares unabashedly, referring to the Inco Triangle from his Barrie, Ontario, home. His attention to the historic record earned him a regular heritage column. As a Greater Sudbury native, lifetime reader and career Inco employee, McAllister understands better than most the unique role of the publication in the hundreds of Sudbury area households that received the Triangle each month. Of course, the operations were often featured in its pages and trumpeted for their forward thinking, but the Triangle was far more than a company mouthpiece. From the 1930s to the 1990s, the paternal influence of the Triangle helped tie together the communities that Inco had built to support its mines. Workers named Salfi, Kanga, Levesque and Rainville, whose birthplaces were scattered across Europe and North America, featured as a fraternity in the Triangle. Marriages, births, deaths, bonspiel winners and expert gardeners were fixtures in the magazine. Sports always featured prominently.

“There’s a lot of foul play going on at the Copper Cliff Club these nights as 36 teams battle it out in the annual bowling tournament for Christmas chickens and turkeys,” a story began in December 1948. Inco built the facilities and wanted them well-used and their workforce athletes celebrated. “An employee wasn’t going to be in the beer parlour then coming to work the next day with a hangover if he was playing sports,” says Jim Fortin, a curator for Greater Sudbury Heritage Museums. “The Triangle was always done with an eye for quality,” says McAllister. “It seemed to be on the mark all the time. It was able to create a rapport between the workforce and the company. Other publications distributed outside the gate would end up in the nearest trash bin. You never saw that with the Triangle. It was read and reread and taken home.” McAllister began at Inco in 1957 as an electrician and over the next 34 years wended his way through various departments of the company. Every month, Inco employees would see their families and their neighbours showcased in the “Family Album.” A generation later, photographers would revisit the families for the “Then and Now” photos, a series that Fortin and McAllister agree was one of the Triangle’s finest. Those featured were invariably dressed in their Sunday best, and the treatment they received matched the occasion. McAllister’s free-ranging column “Heritage Threads” melded personal memories with company history. “The odd time, Jerry Rogers [Inco public affairs manager] would grumble that I

was more interested in personalities than the company history, but I’d say ‘people are the history too, you know.’ He’d grumble a bit more, but he never changed anything I wrote.” Last year, the entire catalogue of Triangle issues was made available online through the cooperation of Vale Inco, the City of Sudbury, its library and museums, and Cambrian College. Fortin was involved in the project and has seen how tightly bound the Triangle is to people in the area. As a feature of the centennial celebration for Garson Mine, the museum had a computer terminal available to access the archives. Family histories lay buried in the Triangle. “All I did for seven hours was type in the names of Inco employees,” he says. The value of the Triangle, Fortin continues, extends beyond the missing roots of the family tree. “If we are doing research on the evolution of first aid and mining safety or on the evolution of re-greening in the area, the Triangle is a great resource.” Between every line of the June 1998 issue of the Triangle — a litany of articles on cost reduction and restructuring — the story of the magazine’s demise was written. It was, after six decades, the last issue published. The unceremonious end is still a raw spot for McAllister who had continued to contribute for a few years after he retired in 1991. That the Triangle thrived long after the era of the company town had ended, however, seems an unembellished testament to its legendary status. CIM www.sudburymuseums.ca November 2009 | 73

cim news CIM welcomes new members Allard, Anthony, Québec Allen, Jonathan, USA Anes, Juan, Ontario Austman, Christine, Saskatchewan Bartolacci, Gianni, Québec Beaulieu, Benoit, Québec Bégin, Jean-Philippe, Québec Béland, Alain, Québec Bensaid, Yahya, Québec Bloin, Michael, Québec Bom, Alice, Ontario Bongiovanni, Mark, Québec Bouchard, Sarah, Québec Bouchard, Marc-Olivier, Québec Boulay, Pierre-André, Québec Bravo, David, Ontario Brown, Ryan, Ontario Buckingham, Tyler, Ontario Cameron, Stephanie, Ontario Campsall, David, Ontario Carfagnini, Nicholas, Ontario Chung, Tseuk Sun J.C., Ontario Comeau, Richard, Québec Crofton, Anthony, Québec Déraspe, Valérie, Québec Dhawan, Nikhil, USA Dick Chakela, Norman Taolana, Ontario Dong, Jie, Ontario Drolet, Marie-Michèle, Québec Duguay Blanchette, Jessie, Québec Dumas, Rene, Québec Elliott, Russell, Ontario Esteban, Ricardo, Québec Faggioni, Peter, Ontario Faucher, Samuel, Québec Fiset, Gilles, Québec Fitzpatrick, Terry, Ontario Fortier, Simon, Québec Frazier, Eric, Ontario Gagné, Julie, Québec Gagnon, Marc-Antoine, Québec Gao, Xiaoxiang, Ontario Gaudet, Michael, British Columbia Gélinas, Simon, Québec Ghasdi Marghostaee, Mohammed, Québec Gingras, Vincent, Québec

Goldreich, Steven, Ontario Groleau, Philippe, Québec Hadi, Moosa, Ontario Heidari, Hamed, Ontario Hundrieser, Michelle, Ontario Infilise, Philipe, Québec Jessop, Casey, Québec Kemane, Rodric Jackson, Ontario Kermani, Mehrdad, Québec Kerr, Andy, Ontario Kolundzija, Dijana, Ontario Kotersi, Oualid, Québec Laflamme, Maxime, Québec Laframboise, François, Québec Lafrenière, Charles, Québec Lamontagne, Vincent, Québec Lang, Jake, Ontario Larivière, Randy, Yukon Territory Lau, Tony, USA Lavoie, François, Québec Lawrence, Stuart, Ontario Légaré-Laganière, Jacinthe, Québec Lennox, Robert, Québec Lessard, Vincent, Québec Leung, David, Ontario Lévesque-Michaud, Maude, Québec Lévesque-Tremblay, Charles, Québec Lister, Jonathan, Ontario Liu, Danruo D.L., Ontario Maihot-Larouche, Vincent, Québec McHugh, Graham, Ontario Meghezi, Sébastien, Québec Moilwa Kenewang, Karen, Ontario

Morin-Bouliann, Alex, Québec Mosweu, Gabotswane, Ontario Nadeau, Patrice, Québec Nguyen, Kim-Quyen, Québec Parry, Matthew, USA Perras, Matthew, Ontario Perron-Drolet, François, Québec Portelance, Michel, Québec Raymond, Gilles, Québec Reix, Isreal, Québec Richard, Katy, Ontario Rivard, Stephane, Québec Rodrogue, Richard, Québec Roy, Matthew, Ontario Roy, Benjamin, Ontario Roy, Nicolas, Québec Saint-Jean, Richard, Québec Savard, Mathieu, Québec Shrestha, Bibek, Saskatchewan Smith, Garry K., Ontario Smith, Pierre-Olivier, Québec Somot, Stéphanie, Québec Spurr, Mackenzie, Ontario Tanguay, Marc-André, Québec Tendijowski, Lisa, Ontario Thivierge, Steve, Québec Thorne, Sierra Devon, Ontario Timmis, Bret, Ontario Tougas, Bernard, Québec Turner, Oliver, Ontario Wythiahlowsky, Alex, Ontario Zwaan, Derek, Ontario

CIM introduces Teresa Barrett as its new membership liaison We are happy to announce that Teresa Barrett has joined CIM as its membership liaison agent. Many industry representatives may know her from the Prospectors and Developers Association of Canada (PDAC) and Sandvik Mining and Construction. She is also an active volunteer with the PDAC’s Human Resources Development Committee. At CIM, Teresa will be heading the drive to recruit and retain students, young leaders, and national and international members. She’ll also be actively supporting branch programs and volunteer activities. For more information on CIM’s membership initiatives, you can contact Teresa by phone at 514.939.2710 or at tbarrett@cim.org. November 2009 | 75

cim news Friendly fire in Fort McMurray CIM and APEGGA join forces in student draw By Christian West

Herman Huang gears up for a day of fun

The CIM Oils Sands Branch, in conjunction with the Association of Professional Engineers, Geologists and Geophysicists of Alberta (APEGGA), hosted their first student paintball and barbeque last August. Twenty-two students braved threatening clouds — and perhaps the after-effects of their final Friday night in Fort McMurray — to come out for an afternoon of paintball. Students met for the event at Thunder Ridge Paintball, north of boomtown, where they were geared up with the appropriate personal protective equipment, a paintball gun and an initial supply of paintballs. They were divided into two teams by the Thunder Ridge staff who then led them through the woods for a series of thrilling games. Within the hour, smiling students were streaming back for additional paintballs with which to settle a score

or two on the field. By the end of the three-hour game, they poured out of the woods covered from head to toe in mud, laughing and regaling each other with “war” stories. With rain clouds threatening to wash out the afternoon barbeque, plans were replaced with a quick order of pizza. Between mouthfuls, energetic students reflected on the thrills of their battles. In an effort to ensure student participation, the branch and APEGGA both subsidized student participation costs. Special thanks are extended to Suncor, who sponsored the registration fee of students within their company. These joint efforts generated substantial student participation from the production sites surrounding Fort McMurray. CIM

About the author Christian West is chairman of the CIM Oil Sands Branch.

Géogolf 2009 un succès Par Louise Blais-Leroux Le tournoi Géogolf de la Section de Québec de l’ICM s’est tenu le 28 août dernier. Les 52 golfeurs ont profité d’une magnifique journée ensoleillée au Club de Golf Lac St-Joseph. Le quatuor gagnant était composé de messieurs Paul Archer, Jacques Bonneau, Steve Larouche et Yvon Trudeau. Le Prix du District no 2 a été remis à Marie Fortin pour son bénévolat de 10 ans en tant que secrétaire à la section. Le tournoi a clôturé en soirée par un excellent repas et la distribution de nombreux prix. ICM Pierre Verpaelst, vice-résident de section, remettant le Prix du Disctrict No. 2 à Mme Marie Fortin.

De gauche à droite / from left to right : Pierre Verpaelst, Steve Larouche, Sylvie Vachon, Yvon Trudeau et Jacques Bonneau

Another successful Géogolf tournament The Quebec Branch Géogolf tournament was held at the Club de Golf Lac St-Joseph on August 28. Of the 52 golfers who participated, the winning foursome was comprised of Paul Archer, Jacques Bonneau, Steve Larouche and Yvon Trudeau. The branch also awarded Marie Fortin the District 2 prize in recognition of her ten years as branch secretary. The day was capped off with an excellent meal, and many prizes were given out. CIM

76 | CIM Magazine | Vol. 4, No. 7

cim news Keeping spirits high CIM Distinguished Service Medal winner builds up enthusiam By Robbie Pillo One of our industry’s most prestigious awards, the CIM Distinguished Service Medal, was awarded this year to Samantha Espley for her tireless dedication to CIM and her strong efforts in promoting the industry through Science North and Women in Science and Engineering (WISE).

Achieving success through support WISE Sudbury, a volunteer-based organization, encourages young women to consider careers in science and engineering and provides a support network for women in these fields. Created in 1998, WISE brought together 10 pioneering female professionals from various technical disciplines. Initially, they simply compared notes on one another’s experiences. “This was a perfect opportunity to bounce different ideas off people dealing with the same issues,” recalls Espley. WISE has now grown to include more than 100 women. “With such a diverse group, we get to see many different sides of a particular topic,” says Espley. “The more you know, the better you will be at making decisions.” WISE meetings cover topics from networking in a male-dominated industry to fine-tuning the juggling act between family and career. Espley, a mother of four, is especially gifted at the latter. She encourages all young women to enter such groups. “My family has always been there to encourage me throughout my career, but having this kind of additional support would have been worthwhile,” she says.

Building success through teamwork WISE has also been instrumental in educating young girls on science and engineering. Their highly successful annual Science and Engineering Olympics draws over 120 female stu-

CIM Past President Jim Gowans presents the CIM Distinguished Service Medal to Samantha Espley.

dents from grades 4 to 7 from the Sudbury region. “They keep coming back each year until they get too old; then they volunteer,” says Espley. Espley attributes WISE’s success to a simple formula. Besides science and engineering, WISE events also teach young girls leadership and teamwork — vital skills needed in both fields. Seeking to tap into WISE’s success, Science North approached Espley to become part of its team. She now chairs its science committee and is part of its board of trustees. “It’s a huge part of the Sudbury community — an icon,” says Espley. “I feel it’s very important and helps keep Sudbury sustainable.”

It’s all in the family Mining was a frequent subject at the dinner table when Espley was growing up. Her father, George Espley, held management positions in mining and finance, while her uncle, Les Dunks, was a mining engineer for Falconbridge in Sudbury. “My uncle would talk of the mines so passionately that I got hooked as a

teenager and flowed right into it,” Espley reminisces. After graduating with a bachelor’s degree in geological engineering from the University of Toronto, Espley went to work for Falconbridge Ltd. before moving on to Inco Ltd., where her work led to a part-time master’s degree in mining engineering from Laurentian University. While completing her master’s, she worked full time and had two children. “I used my maternity leave to write my thesis,” recalls Espley. “It was tiring. I watched my husband carry on with life with my children, while I waved from the window.” It was a sacrifice she does not regret having made. As a manager of mining technical services at Vale Inco in Copper Cliff, Espley leads the team that is providing engineering services for the mining operations and helping to build business strategies for the future.

Reaching success by reaching out Well-known within the CIM community, Espley’s father encouraged her to follow in his footsteps. “He was a role model for me, ever since I was a young child. Right off the bat, he told me to get involved with CIM, and so I did.” She has been a member of the Sudbury Branch Executive Committee for several years and served as chair in 2007. She is now looking forward to collaborating with her colleagues on the technical committee of MEMO 2010. Espley was elated to receive the CIM Distinguished Service Medal. “I was on cloud nine to be celebrated that way. I could not believe that I was the one who was receiving the award. I just wanted to give back to an industry that helped me with so many of my achievements. I am passionate about the mining industry. When you are doing something you love, you just want to put everything you have into it.” CIM November 2009 | 77

cim news From point B to point B The New Brunswick Branch holds its annual convention By Barbara Rose The CIM New Brunswick Branch hosted its 34th Annual Convention at Danny’s Inn and Conference Centre in Beresford, New Brunswick, from September 10 to 12. The increased attendance this year was a testament to the hard work by the organizing committee. For the first time ever, a silent auction was held during the traditional meet-and-greet on Thursday evening. Several items generated friendly competition, including a watercolour by Newfoundland artist John Furey of the No. 3 Head Frame at Brunswick Mine. In his opening address, Greg Ashe, general manager of Xstrata Zinc’s Brunswick Mine, spoke of the relationships he had developed over the years with many of the slated speakers. He emphasized the importance of CIM in helping to create and maintain such professional and personal relationships within the industry. Friday’s technical sessions, organized under the theme of “Economic Challenges/Mining in Uncertain Times,” were opened by Assistant Deputy Minister Cecil Freeman of the Department of Natural Resources. A highlight of the session, CIM Distinguished Lecturer Jan Nesset delivered his presentation “100 Years of Blowing Bubbles for Profit.” His spirited enthusiasm was reminiscent of his presentation at the convention 24 years ago, for which he received the Best Presentation Award. A total of 16 papers were presented on topics such as exploration, petroleum, potash, hard rock mining, milling, smelting and safety. Concurrent sessions on geology and mining/metallurgy were held in the afternoon. Guests were treated to an unforgettable spa experience at the Auberge de la Vallée in Bathurst. They enjoyed back massages and synchronized exercises in the pool, and each guest left with a personalized gift. 78 | CIM Magazine | Vol. 4, No. 7

The organizing committee: (front row, from left to right) Jodi Roberts, Barbara Rose, Marie-Claude Dumont, Tracy White; (back row, from left to right) Robert White, Dustin Ceretti, Tyler Roberts, Sean McClenaghan, Ron Toivanen and Ron Phillips

On Friday evening, delegates and guests savoured the region’s famed seafood and were entertained by local blues band J.P. LeBlanc, which reunited for this one special event. Bright and early on Saturday morning, participants headed to the Gowan Brae Golf and Country Club in

Bathurst for a friendly competition. Prizes were presented over lunch at the Bathurst Marina, where the excellent view helped to inspire plans for next year’s convention. CIM

About the author Barbara Rose is chairman of the CIM New Brunswick Branch.

The CIM New Brunswick Branch would like to thank the following sponsors: Atlas Copco Construction and Mining • Captain’s Cabin • Cementation • Hatheway Limited • Keating Landscaping • Mansour Mining • Mining Technologies International • Spantech Technical Services Ltd. • Xstrata Zinc

Obituaries | Avis de décès William (Bill) Belovay joined CIM in 1994. He passed away in June 2009. Sylvie Brassard est devenue membre de l’ICM en 2002. Rod Samuels joined CIM in 1997. He died on July 14, 2009. Jim Welch joined CIM in 1978 and became a life member in 2001. He died on May 22, 2009.

cim news Northern branch back in action The Yellowknife Branch reinvigorates itself with a barbeque and a golf tournament By Joe Heimbach The CIM Yellowknife Branch has emerged anew after a long hibernation, with a new executive and a fun golf tournament. The winds and the spirits were high at the branch’s first annual golf tournament held last August. About 40 golfers braved cold blustery weather and just a few bugs on nine holes of the all-sand-androck course. Fittingly, the winning round was scored by the tournament’s principal sponsor, Miles Safranovich, COO of Nuna Logistics, who arrived from Edmonton just in time to tee off. The golf was followed by a family barbeque in the clubhouse and a charity putting tournament, sponsored by Atlas Copco. The putting tourney funds were donated to the Yellowknife Women’s Shelter. The event proved to be a great kick-off for the reborn branch, with good representation from industry, government and suppliers. The short-term goal for the Yellowknife Branch is to host two presentations from the Distinguished Lecturer series and to collaborate

with the Northwest Territories and Nunavut Association of Professional Engineers and Geoscientist (NAPEG), the Geological Association of Canada (GAC) and the Mining Association of Canada (MAC). The last event sponsored by the branch was a short course on gold, led by David Lentz and held in conjunction with last November’s Geoscience Forum. “That will be a hard act to follow,” says Shannon Campbell, the branch’s new chairman. “Running an organization like this in a smaller community can be challenging because of the limited membership base. The events have to be high quality and of high interest to be successful. In Yellowknife, we’re up to the challenge with our new executive and new approach — partnerships with like-minded groups who have similar purposes and goals. We need to help each other to be successful.” CIM

About the author Geologist Hendrik Falck, NAPEG vice-president and long-time Yellowknife resident, on the course

Joe Heimbach is the social chair of the Yellowknife Branch.

Golf anyone? By Roy Slack

Beautiful weather awaited players of the fourth annual CIM Northern Gateway Branch golf tournament, held at the Highview Golf Course in Powassan on September 18. The 134 CIM members and supporters who hit the links enjoyed a few laughs and cocktails, and the winning team — Peggy Stewart, Brad Stewart, Lorna O’Brien and Rheal Tremblay (pictured left to right) — shot a 10 under par score of 60. In addition to the “Longest Drive” and “Closest to the Pin” prizes that were awarded, a $10,000 “Hole-in-One” prize was up for grabs — unfortunately, the hole just could not be sunk. Players were later treated to a BBQ steak dinner and a number of door prizes, and a 50/50 draw was held to raise money for local charities. Other proceeds raised support the Northern Gateway Branch bursaries and scholarship program. Many thanks go to the sponsors and attendees — see you all at next year’s tournament on September 17, 2010! CIM

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cim news Developing excellence The MEMO 2010 Conference will bring exceptional learning and networking opportunities to Sudbury By Marlene Moore CIM’s next major international gathering of maintenance engineers and mine operators will be held at Laurentian University in Sudbury, Ontario, from October 24 to 27, 2010. The third Maintenance Engineering/ Mine Operators (MEMO) Conference will be hosted by CIM’s Sudbury Branch, Mining and Metals Society and Maintenance and Engineering Society. The conference theme, “Mining in the New Economy,” was selected to highlight strategies that Canadian mining companies are using to remain competitive, and to emphasize that more than ever before, cooperation is required between operations and maintenance personnel to achieve goals in challenging times. MEMO 2010 is expected to attract several hundred delegates representing mining companies, the supplies and services sector, and research and educational facilities from Canada and around the world. It will be a prime opportunity to network with colleagues, learn about state-of-the-art products and processes, and foster camaraderie. The inaugural joint MEMO conference was held in Sudbury back in 2005. “Our branch is very pleased to host MEMO once again,” says CIM Sudbury Branch chair Adam Tonnos. “Several of our branch members are on the organizing committee, and the executive team is also involved on many levels.” Conference co-chairs Al Akerman (of CIM’s Sudbury Branch) and Roy Slack (of CIM’s Northern Gateway Branch) are quick to point out that it wasn’t at all difficult to find branch members who wanted to join the organizing committee or help out behind the scenes. “The Northern Gateway and Sudbury branches had been discussing ways to work together on various projects,” says Slack. “Our support of the Sudbury branch and 80 | CIM Magazine | Vol. 4, No. 7

The MEMO 2010 organizing committee at one of their monthly meetings

involvement in MEMO is an example of the collaborative effort that we see more and more of in the mining industry.” Slack is particularly keen on developing events that build awareness among the region’s youth. “It is important to convey to the public, and especially to students, a positive image of the mining industry. We have found that students are very interested in learning about mining and the large variety of exciting jobs in a leading-edge industry.” Akerman agrees, adding, “We’re mentoring the leaders of tomorrow. MEMO 2010 will reach a broad range of industry professionals as well as students just embarking on their mining careers.” Industry professionals and students have much to look forward to. The conference’s comprehensive technical program will cover the following key topics: • Management strategies for costeffective operations • New technologies and equipment • Innovative mining methods • Rapid mine development • Risks in cost and safety management • International mining experiences

• Case studies • Economic and technical feasibility studies • Mine maintenance and production • Mining health and safety and the environment • Human resources and partnership development • Energy conservation Abstracts of up to 300 words are being accepted until April 21, 2010. For further information about the technical program, contact Samantha Espley (Samantha.espley@valeinco. com) or John Sagman (john.sagman@valeinco.com). More details about MEMO 2010, including sponsorship and trade show opportunities, will be regularly added to the conference website. To know more about MEMO 2010 and how you can contribute to or gain from it, contact the conference co-chairs at aakerman@miningexcellence.ca or roy.slack@cementation.ca. CIM www.cim.org/memo2010

About the author Marlene Moore is a member of the CIM Sudbury Branch Executive Committee.

cim news Mentoring the next generation of industry leaders The Sudbury Branch has a long tradition of supporting youth By Adam Tonnos

Photo courtesy of Roxanne Kneer

Mining has a strong presMaintenance Engineering/ ence in Northern Ontario — Mine Operators (MEMO) especially in the Sudbury Conference on October 24-27, region. Without a doubt, the 2010. The organizing commitfuture of the industry in our tee is well into planning, and community will remain viable looks forward to a successful for many generations to come. conference and trade show. While no one can dispute the challenges resulting from a Social networking tools weak global economy, CIM’s As CIM National continues Sudbury Branch is optimistic to revitalize its web presence that the mining sector will to better serve the needs of rebound and revitalize. The Adam Tonnos (left) alongside Lauren Flett (Laurentian University) and John members and create a sense of current downswing should Sagman (MEMO 2010 Technical Committee) during Student Oyster night unity within the branch struccertainly not discourage young ture, part of this proactive people from considering a career in the assistance for their mining programs endeavour is the introduction of a industry, because mining will always be at area high schools. The CIM social network platform. The a key economic driver of the North. In Sudbury Branch also regularly sup- Sudbury Branch is particularly interfact, as the market improves, there will plies mining books and activity kits ested in the benefits of this phenomebe a shortage of skilled workers over for school libraries, and purchases non to CIM as a whole. the next decade. alternative fuel combustion engines Raised as a possibility during the for the primary school pre-appren- CIM Conference and Exhibition 2009 Educational support ticeship training program. in Toronto, the idea led to the estabWith a mandate of fostering growth lishment of a working group to invesin the mining industry, the CIM Local membership activities tigate a suitable approach. Social netSudbury Branch is keen on mentoring General membership meetings are working is an opportunity to leverage mining’s future leaders by financially held monthly from September to online sites such as LinkedIn, Twitter supporting local educational initia- April. These events are highlighted by and Facebook to attract new members tives. For example, the branch con- keynote speakers, including CIM and retain the spirit of networking, tributes to the annual regional science Distinguished Lecturers. Local college knowledge sharing and professional fair, which enables the winning stu- and university students look forward development between the CIM annual dents to participate in national compe- to October’s Student Oyster Night, general meetings. Mining professionals, industry and academia, suppliers titions. It is also a longstanding spon- where they have the opportunity to and buyers, students and employers sor of the Sudbury Mining Week rub shoulders with representatives can all connect regularly in this way, annual mining skills competitions for from area mines, suppliers and related creating a means to further strengthen elementary and secondary school stu- businesses and organizations. our industry. As plans unfold, dents. These activities all help to Every June, the branch hosts the enlighten youth at an early age about ever-popular lobster dinner and dance, branches can look forward to being exciting careers in the industry. and the annual Rudolph Kneer invited to participate in CIM social The branch also awards bursaries Memorial Golf Tournament is always networking groups in the future. for higher learning to students at sold out long before the August tourCIM’s Sudbury Branch is proud to Laurentian University, Cambrian ney. Social events like these are the make a difference in the community, as College and Collège Boréal, and sup- perfect opportunity for CIM members well as at the CIM National level, ports Laurentian University’s national to build community awareness, net- through the commitment of the branch Mining Games team. Congratulations work with colleagues and clients, and executive and the dedicated participaagain to LU for earning top prize at the enjoy some serious camaraderie. tion of its active membership. CIM 2009 competition! The Rainbow District School MEMO 2010 Board’s Specialist High Skills Major The CIM Sudbury Branch is partic- About the author Adam Tonnos is chair programs have received financial ularly proud to host the next of the CIM Sudbury Branch. November 2009 | 81

cim news Deep-sea voice CIM Distinguished Lecturer discusses the tipping point of a new era By Robbie Pillo In 1984, CIM Distinguished Lecturer Steven Scott, a pioneer and expert in seafloor massive sulphide (SMS) deposits, boldly predicted that in the future we would be mining sulphide ores on the ocean floor. More than two decades later, in a move that could revolutionize the mining industry, Torontoheadquartered Nautilus Minerals is the first company to commercially explore the seabed for gold and copper ore deposits. Positioning itself to become an ore producer by 2012, Nautilus’ main focus is on Solwara 1, a deposit site Scott co-discovered with Australian Ray Binns in 1996 offshore of Papua New Guinea. Rich seafloor sulphide deposits are produced worldwide in underwater volcanic regions by hydrothermal vents, chimney-like edifices and mounds of precipitated mineral sulphides. Dubbed as “black smokers,” Scott was the first ore geologist and the first Canadian to explore these hightemperature vents. His lecture, “Seafloor massive sulphides – the dawning of a new industry,” takes an in-depth look at the ore deposits this deep sea prospector plans on mining. CIM: How did you come to study SMS? Scott: An article published in National Geographic in 1979 on the discovery of seafloor hydrothermal vents led me to it. I was initially drawn to them as a way of understanding the processes that produced volcanic-hosted massive sulphide deposits that we mine on land. I met Ray Binns during a lecture at Australia’s Commonwealth Scientific and Industrial Research Organisation [CSIRO] in Sydney in 1984. He commented that although they had some ideas on subsea exploration, they didn’t know how to go about it. That same evening, my wife stumbled on an announcement in the Sydney Morning Herald about CSIRO just acquiring a new oceanographic ship. I was on the phone with Binns that same night and we went to sea the next year. CIM: Your first discovery was in 1983 followed by Solwara 1 in 1996. Did you even fathom such fruitful endeavours? Scott: There certainly were some “Eureka!” moments. Prior to the first discovery, our hope was to understand how ores that formed on the deep seabed would help in the search for mineable deposits on land. We towed cameras above the seafloor and dredged rock samples from promising locales. With Solwara 1, we were just trying to find a place to do our 82 | CIM Magazine | Vol. 4, No. 7

research and ended up doing much better than we thought we would — we found a large, rich and potential mineable deposit. All our hard work was paying off. When Nautilus Minerals begins to mine the Solwara 1 deposit, expected in 2012, Binns and I can say that “we found a mine.” Not many research scientists can claim that. CIM: What are the advantages and pitfalls of deep sea mining? Scott: Because of its totally reusable infrastructure, mining SMS deposits has an advantage over mining on land, where the costs of extensive excavations, roads, power lines, accommodations, etc. have to be amortized over the life of a mine. Land deposits have to be large enough to cover the costs of both discovery and development, whereas, much of the discovery of subsea deposits such as Solwara 1 has already been done by scientific researchers like me. Seafloor mining leaves no shaft or other infrastructures behind and little waste rock because the deposits are sitting on the ocean bed and are not covered with rock. There are financial and technological challenges for recovering SMS deposits but these are surmountable. After all, the oil industry has been working in the deep offshore for decades. CIM: There are growing concerns from many environmentalists and marine biologists over the destruction of the ecosystems around the sites. How can they be addressed? Scott: There is interest in mining only dead vents where deposits have been left behind and there are few animals. The water temperature in active vents can reach as high as 400°C, which would severely damage the mining equipment. We do know that the biological communities around these sites are very resilient and they adapt quickly to changing environments. One way to prevent over-exploitation of hydrothermal vents is to designate some sites or some parts of a minesite as marine protected areas. Nautilus Minerals has completed a very detailed environmental impact statement for their Solwara 1 site that addresses the environmental concerns to the satisfaction of the PNG government and their independent advisors. CIM: Why have you become part of 2009-2010 Distinguished Lecturer season? Scott: I was born and raised in northwestern Ontario. After working at sea for 27 years, the program gives me a chance to return to the mining communities where I long ago did my research. A new industry of seafloor sulphide mining, in which I played a significant role as a research scientist, is about to take off thanks to forward-thinking people in industry. It is an exciting time and I want to bring that excitement to our CIM colleagues and to students. CIM

calendar CIM EVENTS

AROUND THE WORLD

Conférence technique de la section de Québec Éminent conférencier de l’ICM : Engin Özberk 23 novembre Québec, Québec Responsable : Jean-Marc Charbonneau

NewGenGold 2009 November 23-24 Sheraton Perth Hotel, Western Australia Contact: Marie Krsticevich Tel.: +61.8.932.1.0355 Email: marie@paydirt.com.au Website: www.newgengold.com

Red Lake Branch Technical Meeting CIM Distinguished Lecturer Don Thompson November 26 Red Lake, Ontario Contact: Carmen Storey Email: carmen.storey@ontario.ca Canadian Mineral Processor’s Society – Yukon and BC Branch Meeting CIM Distinguished Lecturer Jan Nesset December 4 Vancouver, British Columbia Contact: Tad Crowie Email: tadc@gekkos.ca Edmonton Branch Technical Meeting CIM Distinguished Lecturer Kelly Lendsay December 14 Edmonton, Alberta Contact; Clair Mann Email: cmann@nacg.ca Ottawa Branch Technical Meeting CIM Distinguished Lecturer Steve Scott January 14 Ottawa, Ontario Contact; Jean-François Fiset Email: Jean-Francois.Fiset@NRCan-RNCan.gc.ca 42nd Annual Canadian Minerals Processors Operators’ Conference January 19-21 Westin Hotel, Ottawa, Ontario Contact: Janice Zinck Email: Janice.Zinck@NRCan-RNCan.gc.ca Saskatoon Branch Environmental Night January 21 Sheraton Hotel, Saskatoon, SK Contact: Stephanie Oleniuk Email: stephanie.oleniuk@wardrop.com Sudbury General Membership Meeting Dynamic Earth, Sudbury, Ontario January 21 Contact: Gary Poxleitner Tel.: 705-682-5627 Email: Gary.poxleitner@valeinco.com

Procemin 2009-VI International Processing Seminar Santiago, Chile December 2-4 Contact: Fabiola Bustamante Email: info@procemin2009.com Website : www.procemin2009.com American Mining Hall of Fame Banquet December 5 Tucson Marriott University Park, Tucson, Arizona Contact: Jean Austin Tel.: 520.577.7519 Email: admin@miningfoundationsw.org Website: www.miningfoundationsw.org The Canadian Institute’s Aboriginal – Industry Business Partnerships Conference December 7-8 Four Seasons Hotel, Vancouver, British Columbia Contact: Cheryl Robertson Tel.: 1.877.927.7936 Email: publications@canadinainstitute.com Website: www.canadianinstitute.com/Partnerships.htm Mineral Exploration Roundup 2010 January 18-21 The Westin Bayshore, Vancouver, British Columbia Contact: Morgen Andoff Email: roundup@amebc.ca Website: www.amebc.ca/roundup/roundupregistration.aspx Processing of Industrial Minerals’10 February 4-5 The President Hotel, Istanbul, Turkey Contact: Barry Willis Email: bwills@min-eng.com Website: www.min-eng.com/pim10 PDAC 2010 March 7-10 Metro Toronto Convention Centre, Toronto, Ontario Contact: Maya Kwasnycia Tel.: 416.362.1969 Email: convention@pdac.ca Website: www.pdac.ca November 2009 | 83

n behalf of the executive committee, I am delighted to invite you to the 42nd Annual Canadian Mineral Processors Operators’ Conference.

Since 1968, the CMP has facilitated the development of the people and technologies involved in mineral processing by providing a platform for networking and the sharing of best practices. At today’s metal prices and high input costs, metallurgists are more focused than ever on enhancing recovery. At the conference, delegates can learn how their colleagues are achieving ever greater efficiencies to remain competitive. Attracting a growing number of international delegates, the CMP conference is an excellent opportunity to network with suppliers and researchers. Today, with low metal prices, high costs and scarce deposits, networking and innovation are pressing needs. Our student program allows future mineral processors to interact with and learn from established professionals. Our sponsors help two students from each Canadian mineral processing education program to attend the conference; the winners of the André Laplante Scholarship and CMP essay contest attend as well. Do take the time to meet and encourage these 28 promising students. Ottawa boasts many sporting, cultural and gastronomic attractions. Be sure to discover and enjoy some of them during your stay. Don’t miss the hotly contested hockey match that has become a favourite feature of the conference. The CMP has greatly furthered my own professional and technical development. I am sure that you too will benefit from attending. I look forward to seeing you there. Robert Henderson Chairman

Short Course

e la part du comité exécutif, j’ai le plaisir de vous inviter à la 42e Conférence annuelle des minéralurgistes du Canada.

Depuis 1968, les minéralurgistes du Canada ont facilité le perfectionnement des personnes et des technologies dans le domaine de la minéralurgie en offrant un moyen de faire du réseautage et de diffuser les pratiques exemplaires. En raison du coût actuel du métal et des facteurs de production, les métallurgistes s’intéressent plus que jamais à l’amélioration du recouvrement. Au cours de la conférence, les délégués auront la possibilité d’apprendre comment leurs collègues réussissent à accroître leur efficacité de plus en plus afin d’être à la hauteur de la concurrence. Vu le nombre croissant de délégués internationaux qui y viennent, la Conférence des minéralurgistes du Canada est une excellente occasion de faire du réseautage auprès des fournisseurs et des chercheurs. Comme les prix des métaux sont actuellement bas, les coûts élevés et les gisements peu abondants, le réseautage et l’innovation représentent une nécessité des plus impérieuses. Notre programme pour les étudiants permet aux minéralurgistes de l’avenir de faire la connaissance de professionnels expérimentés et de tirer profit de leur savoir. Parmi les participants à la conférence, on peut compter deux étudiants de chaque programme de formation en minéralurgie au Canada, qui y assistent grâce à l’aide de nos commanditaires, ainsi que les lauréats de la bourse commémorative André Laplante et du concours de rédaction des minéralurgistes du Canada. Je vous invite à prendre un moment pour faire la rencontre de ces 28 étudiants prometteurs et à leur offrir un mot d’encouragement. Ottawa jouit de nombreux points d’intérêt sportifs, culturels et gastronomiques. Je vous conseille de ne pas manquer d’en découvrir quelques-uns pendant votre séjour et de profiter de ce qu’ils ont à offrir. Je vous conseille également de ne pas rater le match de hockey, où la lutte acharnée que se livrent les joueurs fait de lui une des activités préférées de la conférence. Les minéralurgistes du Canada ont contribué de manière importante à mon perfectionnement professionnel et technique. Je suis certaine que la conférence s’avérera profitable pour vous aussi et il me tarde de vous y voir. Robert Henderson Président de la conférence

A one-day short course on National Instrument 43-101 standards of disclosure for mineral projects will be held on January 18. This course will go through each of the disclosure requirements under NI 43-101 that are pertinent to metallurgists and other Qualified Persons that prepare technical disclosure on the metallurgy of a mineral project. The requirements to be considered a Qualified Person for metallurgy and process engineering will be reviewed, as well as the obligations of those individuals under NI 43-101 and other securities law. We will briefly outline new civil liabilities legislation in Canada that increase the possible consequences for not complying with the disclosure standards.

Cours abrégé Le CMP tiendra un cours abrégé d’une journée le 18 janvier sur la Norme canadienne 43-101 – Information concernant les projets miniers. Le cours permettra de se pencher sur chaque obligation d’information en vertu de la norme canadienne (NC) 43101 qui concerne les métallurgistes et d’autres personnes qualifiées préparant des documents d’information technique sur la métallurgie d’une entreprise minière. Il s’agit d’examiner les critères auxquels il faut répondre pour avoir droit au titre de personne qualifiée en métallurgie et en génie des procédés opérationnels et d’examiner les obligations des personnes susmentionnées en vertu de la NC 43-101 et d’autres lois sur les valeurs mobilières. On effectuera un bref survol de la nouvelle législation en matière de responsabilité civile au Canada, qui resserre les sanctions pour le non- respect des normes sur la diffusion des documents d’information. November 2009 | 85

Social Program | Programme sociale Tuesday | Mardi

Monday | Lundi 19:00–22:00 20:00–23:00

Early conference registration | Inscription anticipée à la conférence Student mixer | Soirée-rencontre des étudiants

7:00–8:15 7:00–15:15 12:10 20:00 21:00

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Photo courtesy of Xstrata Technology

Plenary Session

New Ideas and Technology

Chairman’s opening remarks and announcements R. Henderson

The right technology in the right place: how Xstrata Nickel Australasia increased throughput at its Cosmos Plant with strategic implementation of technology solutions M. Cooper, D. Curry, T. Shouldice, M. Young and J. Rubenstein

Setting the record straight CIM Distinguished Lecturer Don Thompson

Operations The development and commissioning of Ontario’s first diamond mine — the Victor Diamond Mine A. Hempstock, N. Morrison and R. Welyhorsky Mohawk Garnet B. McCurdy, S. Stewart, J. Sadowski and M. Neven Copper nickel separation — controlling to target in all weather M. Cook, C. Loen, G. Showers and R. Triglavcanin Operational characteristics of the TankCell® 300 at Codelco’s Chuquicamata concentrator A.B. Yanez, S. Gronstad, E. Elgueta and C. Perez Development of a thiosalt treatment system at Xstrata Copper’s Kidd metallurgical site A. Lagace

Process Mineralogy Process diagnosis at Xstrata Process Support L. Kormos, D. Fragomeni, J. Oliveria and L. Whiteman ToF-SIMS surface analyses as a diagnostic and predicative tool for mineral processing: new developments and applications B. Hart and S. Dimov Process mineralogy of silver ores and applications in flowsheet design and plant optimization J. Zhou Stratified sampling of drill core N. Lotter Advances in precious metal trace element analyses for deportment L. Cabris, Y. Choi and M. Nelson A novel geometallurgy framework G. Turner-Saad and C. Dragusanu

Innovative mineral processing technologies — a first decade of R&D at COREM D. Leroux, A. Bouajila and J.F. Wilhelmy Selection of mixed xanthates for Raglan T. Deng and N. Lotter Use of the latest technology to overcome the demands of mill operation T.R. von Ow National Instrument 43-101 standards of disclosure for mineral projects — what metallurgists should know T. Lipiec, G. Gosson and I. Orford Improving mine/mill water network design A.J. Gunson, B. Klein and M. Veiga

Hydrometallurgy The re-emergence of resin in pulp with strong base resins as a low cost, technically viable process for the recovery of uranium J.A. Brown, C.A. Fleming and J.R. Goode Leaching of gold and silver from Kupol composite sample: part II — assessment of the CELP G. Deschênes, J. Rajala, H. Guo and M. Fulton UPP “Python” Operation at the Central Rand Gold Mine in South Africa T. Crowie An economic and environmental case for re-processing gold tailings in South Africa C. Fleming, J.A Brown and M. Botha Engineered Membrane Separation® (EMS®) systems for hydrometallurgical applications L. Lien Biooxidation reactor design considerations A. Carter

Dynamic logistics simulation combined with a process modeling to support capacity expansion studies A. Noiseux and J.-P. Côté Asset optimization through process control at Xstrata Alloys’ Eland Platinum — “optimal doesn’t always rhyme with capital” J. Bouchard, B. Moloto and R. Monapula Kairos Mining — a comprehensive approach to develop copper processing plants automation and sustain its benefits in the long term C. Zamora, L. Castelli and A. Bonomelli Design and implementation of advanced automatic control strategy based on dynamic models for high capacity SAG mill I. Yutronic and R. Toro The importance of efficient mass flow balance in crushing and screening plants F. Romero Experiences with multivariable predictive control strategies on a SAG grinding circuit H. Slater, M.A. Suarez and R. Fuenzalida

Comminution SAG or HPGR — the current dilemma P. Staples and C. Morley Successful design of the Ni-Co grinding circuit for unusually hard ore J. Starkey and M. Samuels The South American experience in adopting twin machine grinding mill relining technologies J. Russell A comparison of energy requirements between HPGR – stirred mill grinding and conventional crushing – ball mill grinding J. Drozdiak, S. Nadolski, B. Klein, A. Bamber and S. Wilson Detection of hydrocyclone malfunction C. Bazin, M. Renaud, A. Faucher, M.M. Manga and S. Caron The benefits and challenges of “split milling” at the Williams Mill T. Buckingham

Wednesday | Mercredi 7:00–8:15 7:30–15:15 11:30 18:00 18:30 19:30

Thursday | Jeudi 7:00–8:15 Authors’ breakfast | Petit déjeuner des auteurs 8:00–15:15 Registration | Inscription

November 2009 | 87

history Porphyry deposits (Part 2) By R.J. “Bob” Cathro, Chemainus, British Columbia The Utah mine is … the biggest thing that men have made. By the end of 1931 there had been moved at Utah 222,000,000 cu. yd. of material, including ore and the waste rock that overlay it. This figure will be increased at an average rate of nearly 20,000,000 yd. per year. Excavations for the Panama Canal are estimated at 232,000,000 cu. yd., but the Canal is 50 miles long …. ~ Parsons, 1933, p. 45

This chapter is derived mainly from a 1997 paper by Ken Krahulec of the Utah Geological Survey. In addition to being the most comprehensive and thorough compilation of the history of the Bingham Canyon camp, it provides invaluable information about the people who played key roles in the discovery and early development of the porphyry deposit. Krahulec also provided photographs, other references and editing help. Some additional background information was also obtained from Parsons (1933) and Rickard (1932).

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Ira Gershwin wrote the lyrics of the song They All Laughed for the 1937 movie “Shall We Dance,” and the music was composed by his brother George. The Gershwins were sophisticated New Yorkers who probably knew next to nothing about mining. If they had, Ira would probably have added a couple of clever lines about the Bingham Canyon porphyry copper mine into the song. The mine’s history would certainly fit with the theme of the song — the tenacity of those who succeed while faced with intense skepticism. The song goes: In many ways, Bingham Canyon, located 50 kiloThey all laughed at Christopher Columbus metres south of Salt Lake When he said the world was round City, was a typical mining They all laughed when Edison recorded sound camp in the western They all laughed at Wilbur and his brother United States between the When they said that man could fly 1850s and 1890s, a period They told Marconi when new discoveries were Wireless was a phony made almost daily and It’s the same old cry financing was readily available. Bingham was discovThey all laughed at Rockefeller Center ered and initially develNow they’re fighting to get in oped by adventurers flockThey all laughed at Whitney and his cotton gin ing to, or returning from, They all laughed at Fulton and his steamboat the California Gold Rush Hershey and his chocolate bar or the silver discovery at Ford and his misery Comstock, Nevada. The Kept the laughers busy early focus was on placer That’s how people are … gold and on silver and gold veins. Base metals weren’t Now they’re eating humble pie … exploited until the railways Who’s got the last laugh now? arrived in the 1870s. (Gershwin, 1936) Commercial production of copper did not begin for almost 40 years after the camp was discovered, even though as early as 1870 it was recognized that copper was the predominant metal in the camp; the name Bingham is now synonymous with the metal. Bingham Creek flows northeasterly and drains an area of rugged terrain near the northern end of the Oquirrh Mountains, where peaks reach elevations of almost 3,250 metres. Argentiferous galena was found by loggers in 1857 but the first claims weren’t staked until 1863 when Civil War soldiers, many of whom had learned something of gold mining in California, were stationed nearby. The camp passed through several early development phases, starting with an estimated 100,000 ounces of placer gold that were recovered near the mouth of the canyon, and then expanding into stamp milling of gold-quartz veins farther upstream, starting in 1882. After unsuccessful attempts to treat lead sulphides, silver was successfully smelted from lead carbonate ores from the interval between the mouth of the canyon and Carr Fork, a distance of about eight kilometres. Carr Fork enters Bingham Creek from the west and is the principal tributary. The best veins averaged over 1,500 g/t (50 oz/ton) Ag and nearly 35% Pb, but the oxidized

economic geology ores, which only extended down to the water table at a grade” mineralized monzonite was derisively referred to as depth of 10 to 15 metres, were soon exhausted. The “wall-rock.” Wall had submitted his property to many of underlying sulphides proved untreatable because the the important people involved in copper mining in the galena-sphalerite-chalcopyrite mixture was refractive and West, including Benjamin Guggenheim of American produced dirty concentrates. Smelting and Refining, Marcus Daly of By 1874, Bingham Canyon had 53 Anaconda and William Clark of United mines and a population of 800 that was Verde, but they all turned him down. crammed into a one-street town centred Wall was finally able to interest De at the wider junction of Bingham Creek Lamar in his copper property in 1895, and Carr Fork and extended down the when the copper price was low, and again torturously narrow canyon. The in 1898 when it was higher. De Lamar Engineering and Mining Journal referred to sent his general manager Hartwig A. Bingham in 1912 as “a sewer five miles Cohen, his mining engineer, Robert C. long.” Fortunately, copper sulphate in the Gemmell, and his metallurgical and concreek water not only killed the bacteria struction superintendent, Daniel C. but eliminated offensive odours. In 1885, Jackling to make a careful evaluation. It D.B. Huntley noted that the water in involved the collection of 566 channel Bingham Creek between Carr Fork and samples underground and a 69-tonne mill Copper Centre Gulch, the next tributary test in a small stamp mill. They calculated A. Wall (1838-1920) (from Parsons, above Carr Fork, contained copper in Enos an indicated reserve of 13.6 million 1933) solution, and that native copper had been tonnes averaging 2.22% Cu and 0.6 g/t deposited in the organic-rich parts of the creek bed and in (0.018 oz/ton) Au, which Cohen concluded would be iron-cemented gravels (ferricrete). Although most unprofitable because it was covered by a 15 metre-thick prospectors failed to notice its significance, this was a leached cap. clear indication that a large copper sulphide system was In May 1899, Gemmell and Jackling were able to conbeing oxidized and leached upstream. vince Victor M. Clement, Cohen’s successor, to take Enos A. Wall may have been the first person to recog- another look; he was enthused enough to arrange another nize that the disseminated ”low-grade” copper mineraliza- option with Wall. Another $46,000 was spent on addition in Bingham Canyon might have economic potential. tional drifting and sampling and a larger milling test of A successful inventor (of a roll crusher for grinding mills), 520 tonnes. Jackling concluded that a recovery of 71.7 businessman and entrepreneur from Indiana whose min- per cent was achievable to produce a concentrate containing career had taken him to Colorado, Montana and ing 21.75% Cu, 0.05 g/t (0.016 oz/ton) Au and 4.7 g/t Idaho, he arrived in Utah in 1887 and became involved in (0.15 oz/ton) Ag. Clement calculated a proven reserve of the Mercur gold camp, about 30 kilometres southwest of 10.9 million tonnes averaging 2.25% Cu and reported Bingham. When he visited Bingham, he was impressed at that an operating profit of $2.56 per tonne was achievonce by a zone of disseminated chalcocite and bornite that able, assuming open pit mining with steam shovels and a was exposed in monzonite for a distance of 100 metres in 24-kilometre railway to transport the ore to an 1,800 the wall of Bingham Creek just above Carr Fork. It was tonne-per-day mill. also exposed for a length of 30 metres in the abandoned Either because an agreement could not be reached with Soldier Tunnel. Sampling revealed that the average grade “the irascible” Wall or because he was too timid to take was at least 2.4% Cu. Wall was able to re-stake two claims such a big gamble, De Lamar declined to proceed and was that covered the showing because the original claims cov- left with a 25 per cent interest in the property. Clement ering this area had lapsed due to disinterest. and Gemmell left for another project in Mexico and While Wall couldn’t afford to develop the property on Jackling moved on to the Republic Mine in Washington. his own, he did manage to enlarge the property to 72 Wall made repeated but unsuccessful efforts to interest hectares (179 acres) by 1887 and to explore it with 1,065 Benjamin Guggenheim, Marcus Daly, John Hays metres of drifts and crosscuts in several adits by 1896. Hammond, William Clark, General Electric and Tharsis That work was partly financed by the 1894 sale of the Sulphur in his property between 1900 and 1903. Brickyard gold mine at Mercur to Captain Joseph R. De Meanwhile, Samuel Newhouse (1853-1930) had arrived Lamar, a Dutch-born mine operator and a genuine sea in Bingham in 1896 with mining engineer Thomas Weir. captain, who owned the Golden Gate Mine at Mercur, one Newhouse had studied law in Pennsylvania before moving of the largest and most successful cyanide mills in the to Colorado, where he became a wealthy mine developer United States. At this time, selective mining of the better and promoter in Leadville and Ouray. With financial backcopper veins in Bingham Canyon had proven unprofitable ing from England, they formed Utah Consolidated Gold and interest in that metal was very low. In fact, the ”low- Mines, Ltd. and acquired the Highland Boy gold mine near November 2009 | 89

economic geology

Bingham Canyon, circa 1900, showing the future site of the porphyry mine at the junction of Bingham Creek (to the left) and Carr Fork (to the right). The Wall property is on the lower slopes of the hill in the centre of the picture. The Highland Boy Mine is out of sight up Carr Fork. (from Parsons, 1933 without attribution; believed to be a USGS photo)

the headwaters of Carr Fork. However, their attempt at underground mining of oxide ore grading approximately 15 g/t (0.5 oz/ton) was unsuccessful because the high copper content of the ore resulted in a gold recovery of only 50% in their cyanide mill. The same problem had been encountered elsewhere in the camp but was always carefully concealed from investors. While Newhouse attempted to raise more funds, Weir continued underground exploration and unexpectedly intersected a zone of high-grade copper ore about 60 metres thick and 115 metres long that averaged 12% Cu, and over 6 g/t (0.2 oz/ton) Au and 85 g/t (2.8 oz/ton) Ag. It was described by J.M. Boutwell of the United States Geological Survey as “one of the largest single bodies of copper-iron in the world that are known to have been deposited by replacement.” When the first copper sulphide ore was shipped from the Highland Boy mine in May 1897, it marked the beginning of commercial copper production from the camp. By 1901, Utah Consolidated had built a 450-tonne stamp mill at the mine, a 4,160-metre aerial tramway and a 250-tonne reverberatory smelter, a testament to the management and engineering skills of Newhouse and Weir. The mine became one of the leading innovators in the camp for its use of machine drills, electric fuses and muledrawn ore cars. In around 1902, the property was sold for $12 million to the Standard Oil Syndicate’ composed of H.H. Rogers, William Rockefeller and associates, with Newhouse reportedly receiving $3 million. As late as the mid-1890s, Bingham’s largest mines were still dominantly silver-lead producers. However, the success of Highland Boy resulted in copper becoming the dominant metal in the camp. In order to avoid the problems caused by the Apex Law, and create bigger claim blocks needed for large-scale and low-cost mining, a new phase of exploration and claim consolidation ensued. 90 | CIM Magazine | Vol. 4, No. 7

In 1899, several of the silver-lead mines around Galena Gulch were acquired by the United States Mining Company. The Utah-Apex Mining Company consolidated the New York and Copperfield claims in upper Carr Fork below the Highland Boy Mine, added the Dana and Petro groups of the Phoenix Mining Company, and developed a 225,000-tonne reserve of 2.5% Cu with fair gold and silver credits. The Commercial and adjoining claims to the north of the Jordan and Galena silver-lead mines were combined into a property owned by the Bingham Gold and Copper Mining Company (Bingham Mines) in 1901. It contained a sizable mineralized zone grading 2.5 to 3.0% Cu and between 3.1 and 4.6 g/t (0.1 to 0.15 oz/ton) Au. After the property was further enlarged to 120 hectares (300 acres), the name was changed to Bingham Consolidated Mining Company and block-caving mining was introduced. While all this work was underway, a railroad was built from lower Bingham Canyon to the upper part of Carr Fork. After his initial success with a former gold mine, Samuel Newhouse decided to try his luck again. As his next target, he chose the Stewart and Stewart No. 2 claims, which adjoined the south side of the Highland Boy property. He then expanded his land eastward into a 125 hectare (300 acre) property by acquiring all the available adjacent ground uphill from the Wall property. The bedrock in this area was generally regarded as barren monzonite, but the outcrops turned out to be leached cap that was underlain by the extension of the “low-grade” mineralization on the Wall property. The Boston Consolidated Copper and Gold Mining Company, Ltd. was formed in Boston in 1898 to obtain financing in England for the development of this property, and it was that effort which was denigrated so badly by the editor of The Engineering and Mining Journal in 1899 (see the previous article in this series, CIM Magazine, September/October 2009, p. 102). Several years would elapse before it became clear that the mineralized monzonite intrusion was essentially contained within the boundaries of the Newhouse and Wall properties. Samuel Newhouse was either a genius or the luckiest man in Utah. CIM

References Gershwin, I. (1936). They all laughed. (from the movie ‘Shall We Dance’ by RKO Radio Pictures). New York: Gershwin Publishing Corp. Krahulec, K.A. (1997). History and production of the West Mountain (Bingham) mining district, Utah. In D.A. John & G.H. Ballantyne (Eds.) Geology and ore deposits of the Oquirrh and central Wasatch Mountains, Utah. Society of Economic Geologists Guidebook, v. 29, pp. 189-218. Parsons, A.B. (1933). The porphyry coppers. New York: The American Institute of Mining and Metallurgical Engineers. Rickard, T.A. (1932). A history of American mining. New York: McGraw-Hill Book Company, Inc.

metallurgy The beginnings of mineral processing research in Canada (Part 1) By Fathi Habashi, Department of Mining, Metallurgical, and Materials Engineering, Laval University

Introduction The exploration and mining of mineral deposits and physical metallurgy are intimately related to the domains of mineral processing — beneficiation and extractive metallurgy. The metallurgical industry is also similarly closely tied to the chemical industry, for example, the processing of ores in electric furnaces to produce calcium carbide or the production of fertilizers as a co-product of metal production. Today, the mining industry in Canada is worth over $40 billion, and Canada is a world leader in metallurgical research.

The Frobisher expeditions In 1560, Martin Frobisher (c.1535-1594), one of the first English explorers to sail the North American coast looking for the elusive Northwest Passage to the Orient, reached Labrador and Baffin Island. Among the prizes he brought back home to England was a sample of some “black earth,” a substance rumoured to be gold ore. The story of his fabled discovery spread quickly and the next year, Queen Elizabeth I lent Frobisher’s ship aid from the Royal Navy and funds to defray his expenses. A Company of Cathay was established and Frobisher was appointed admiral. On his second voyage in 1577, Frobisher carried 1,500 tons of “black earth” home only to be informed that it was worthless iron pyrite. Undaunted, Frobisher returned to Canada in 1578 and found what he thought was another source of gold. He carted 1,300 tons of material from this new site back and was informed that it, too, was the same worthless substance as his first sample. This second consecutive failure made Frobisher the target of much dissatisfaction among the investors who financed his voyages. He was temporarily discredited and found little employment for several years until 1586, when growing naval hostilities between

Martin Frobisher (c.1535-1594)

England and Spain created the need for a bold sea-captain. His standing restored, Frobisher remained in royal service for the rest of his life.

New France During the French Regime (1534-1763), many scientific observers noted and catalogued the natural resources of New France. In 1635, Jesuit missionaries, the first organized group with both a scientific education and an interest in nature, founded the Collège des Jésuites in Quebec City. As the first teaching institution in what later became Canada, the Collège educated young French immigrants during the rule of Louis XIV. From the mid-17th century, the Collège also began to teach general science. The Jesuit fathers sent back to Europe reports known as Jesuit Relations in which they provided detailed descriptions of the new land. The Collège remained New France’s only institution for classical education until 1759, when it was closed down following the British conquest. A few years later, in 1764, the Jesuit Order was banned in France, and then dissolved by the Pope in 1773. Earlier, the impressive Collège library had been donated to the Séminaire de Québec. This seminary, founded in 1663 by François de Montmorency Laval (16231708), the first bishop of New France, later became known as Séminaire des Missions Étrangères de Paris. Interest in mining and metallurgy in Canada can be traced to the Collège and its library, which contained a copy of the original Latin edition of Agricola’s De Re Metallica (published in 1555) and several other related works. The first true metallurgical operation in Canada was the exploitation of sedimentary iron ore at Saint-Maurice in Quebec. The Saint-Maurice Forges, which were established

A 1759 painting depicting the Collège des Jésuites in Quebec City November 2009 | 91

metallurgy in 1736, ran until 1883. Formal engineering schools that The Geological Survey In 1842, the Province of Canada took the lead by creating taught mining and metallurgy, however, were to come much the Geological Survey of Canada, under the direction of the later, with proper scientific research beginning even later. Montreal-born William E. Logan (1798Following the arrival of the Jesuits 1875). Modelled on its British and in Quebec came the Anglicans, American counterparts, the Geological Presbyterians, Methodists and Baptists, Survey was at first limited to Upper and each of whom established colleges in the Lower Canada. After 1867, it was faced different parts of Canada, mainly to forwith the exploration of virtually all the mally educate and ordain priests. It was territories now comprising Canada. This the founding of the Geological Survey in marked the beginning of the use of scienMontreal in 1842, and the discovery of tific principles to determine the extent of gold in British Columbia in 1858 and of Canada’s mineral wealth. Within the next other mineral resources in different few years, numerous important discoverregions that provided the impetus for ies of mineral deposits were made. The establishing the Mining Section of the collections of the Survey, first housed at Ministry of Interior in 1901. The section Logan’s home, evolved into the National was mandated to help promote the minMuseum of Natural Science by the 1890s. ing and metallurgical industry through Before the Confederation in 1867, each research. William E. Logan (1798-1875) province had its own office for managing its mines. For example, in Quebec the Mining and metallurgical Department of Land of the Crown admineducation istered the issuing of permits for mineral It was only after several decades of exploration and the operation of mines. the country’s early development that In 1881, the Quebec government engaged the need for educating engineers was Joseph Obalski (1852-1915), a Francorealized. Engineers were needed not Polish graduate of the School of Mines in only to exploit natural resources but Paris, as the mining engineer of the also to plan and supervise the construcprovince of Quebec. In 1891, Obalski tion of railways and bridges across became the chief of Quebec’s newly Canada. Sir Edmund W. Head, who from 1854 to 1861 was the Governor founded Bureau of Mines. He is credited General of British North America, as being the first person to systematically played an instrumental role in estabanalyze and evaluate exploration samples. lishing engineering education. In the Nova Scotia had also instituted a early Canadian engineering faculties, Joseph Obalski (1856-1915) Commissioner of Mines before the teaching of mining and metallurgy Confederation, while Ontario set up its was conducted by professors from England or Canadians Bureau of Mines in 1891. By the dawn of the 20th century, who had studied in Europe, mainly at the Royal School of most provinces maintained government bureaus devoted to Mines in London or the Mining Academy in Freiberg. mining. In 1898, the Canadian Institute of Mining and Gradually, as universities were formed by the amalgama- Metallurgy was founded in Montreal by an Act of Parliament tion of small colleges and came under state control, these to serve as an umbrella organization for workers in these engineering faculties expanded. fields. Later, it incorporated petroleum engineers as well. CIM

92 | CIM Magazine | Vol. 4, No. 7

YOUR

GUIDE

TO INDUSTRY KNOWLEDGE

Peer reviewed by leaders in their fields CIM Bulletin abstracts 94

Study of the kinetics of leaching gold from a soft sulphide ore at the Sadiola Mine by G. DeschĂŞnes, T. Mulpeter, H. Guo and M. Fulton

Exploration and Mining Geology Journal Volume 18, Numbers 1 to 4

Canadian Metallurgy Quarterly Volume 48, Number 2

Complete CIM Bulletin papers are posted in the online Technical Paper Library

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executive summaries

M E T A L L U R G Y

Study of the kinetics of leaching gold from a soft sulphide ore at the Sadiola Mine Sadiola Gold Mine is an open pit operation located in Mali and owned by Anglogold Ashanti Ltd., IAMGOLD Corporation and the State of Mali. A conventional cyanidation/carbon-in-pulp (CIP) circuit treats a 15,000 t/d mixture of oxide and sulphide ores at a grade of 3 g/t Au. In 2002, the increasing tonnage of sulphides caused an increase in production costs and a decrease in gold extraction (from 95% to 70-76%). Because of the short retention time of the leach circuit (18 hours) and the refractory nature of the sulphides, gold leaching kinetics are critical. A laboratory investigation was initiated to evaluate actual plant practice and identify a means of improving the gold leaching rate. The study was conducted on a “soft” sulphide gold sample containing 4.96 g/t Au, 0.4 g/t Ag, 2.5% pyrite, 1.2% arsenopyrite and 0.2% pyrrhotite with a P80 of 74 microns. Experiments were conducted under controlled conditions (temperature, dissolved oxygen, cyanide concentration and pH) on a slurry at 30% weight. Straight cyanidation produced a gold extraction of 71.6%. Increasing the dissolved oxygen (DO) to 16 parts per million (ppm) increased the gold extraction to 77.8%. However, the use of oxygen on site is not an option because of prohibitive costs in remote

G. Deschênes, Natural Resources Canada, CANMET, T. Mulpeter, SEMOS, H. Guo, Wardrop Engineering Inc., M. Fulton, Natural Resources Canada, CANMET 94 | CIM Magazine | Vol. 4, No. 7

locations. Using a preleach with 100 g/t lead nitrate prior to cyanidation (plant conditions) produced 76.2% gold extraction. Injection of oxygen into the preleach, in the absence of lead nitrate, proved to be detrimental on gold extraction. Preleaching for more than two hours was detrimental to gold extraction. A two-hour preleach (performed at pH 8, a DO of 8 ppm and with 300 g/t lead nitrate) added at either the start or end, and 450 ppm NaCN produced the preferred conditions, with 79.4% in 20 hours. A decrease of cyanide concentration from 450 to 330 ppm NaCN produced a 2% decrease in gold extraction. A maximum extraction of 81.3% Au was obtained in 20 hours (leach residue at 0.97 g/t Au), using a DO of 16 ppm. Extension of gold leaching beyond 20 hours indicated that all leachable gold had been extracted by that time. Plant modifications were made to allow leaching of oxides and sulphides in separate circuits. Treatment of oxide ores is now performed at a higher rate. Sulphides are processed at a lower throughput, with 300 g/t lead nitrate, to allow a retention time of 22 hours. Combined throughput remains the same and total gold recovery has increased from 76 to 80% for an additional gold production of 454 kg/year.

emg abstracts

Exploration and Mining Geology Journal Volume 18, Numbers 1 to 4 Geology of the Ore Fault Ni-Cu Deposit, Bird River Sill Complex, Manitoba D. Good, Marathon PGM Corp., Toronto, Ontario, C. Mealin, Laurentian University, Department of Earth Sciences, Sudbury, Ontario, and P. Walford, Marathon PGM Corp., Toronto, Ontario The geology of the Ore Fault Ni-Cu deposit has been reinterpreted in light of recent studies of the geology of the Neoarchean Bird River Sill Complex and the occurrence of economic Ni-Cu and Zn-Cu-Ag mineralization. The Ni-Cu sulfides are hosted by the lower of two parallel NNW-trending and moderately W-dipping mafic–ultramafic intrusions related to the Bird River Sill Complex. The bodies intruded a bimodal volcanic suite consisting of weakly deformed mafic flows and felsic pyroclastic rocks. The mafic volcanic rocks are geochemically related to the MORBtype rocks of the Lamprey Falls Formation, and the felsic volcanic rocks are related to arc-type rocks of the Peterson Creek Formation. The original pyroxene- and olivine-dominated mineralogy of the sills has been replaced by variable serpentine-amphibole-talc-carbonate assemblages. The Ni-Cu sulfide assemblage exhibits textures and geochemical signatures typical of orthomagmatic sulfide mineralization. The sulfide minerals are associated with cumulate layers of magnetic ferrochromite that range in thickness from a few to tens of centimeters. A later event of Zn-Cu-Ag sulfide mineralization associated with quartz veining and garnet-chlorite alteration along a fault that strikes north, dips vertically, and cuts all rock types. The mineralized fault is cut by the NE-trending Peterson Creek Shear Zone. Where the Ni-Cu and Zn-Cu-Ag mineralized zones intersect, remnant magmatic features such as amphibolite or cumulate ferrochromite bands occur within quartz veins or local chlorite alteration. The mixed zones contain a very unusual polymetallic assemblage of Ni, Cu, Zn, Ag, and platinum group elements (PGE). Résumé — La géologie du gîte de Ni-Cu Ore Fault a été réinterprété à la lumière d’études géologiques récentes du Complexe de Sills de Bird River d’âge Néoarchéen et de ses minéralisations en Ni-Cu et en Zn-Cu-Ag économiques. Les sulfures de Ni-Cu sont encaissés par la plus basse de deux intrusions mafiques-ultramafiques parallèles de direction NNW à pendage modéré vers l’ouest associées au Complexe de Sills de Bird River. Ces intrusions sont mises en place dans une suite volcanique bimodale qui consiste principalement en coulées mafiques et en roches pyroclastiques felsiques faiblement déformées. Les roches volcaniques mafiques sont géochimiquement apparentées aux roches de type MORB de la Formation de Lamprey Falls, et les roches volcaniques felsiques s’apparentent aux roches de type arc insulaire de la Formation de Peterson Creek. La minéralogie originale des sills, dominée par l’olivine et le pyroxène, a été remplacée par divers assemblages à serpentine-amphibole-talc-carbonate. L’assemblage de sulfures de Ni-Cu présente des textures et des signatures géochimiques typiques d’une minéralisation en sulfures orthomagmatiques. Les minéraux sulfurés sont associés à des niveaux de cumulat de ferrochromite magnétique qui varient en épaisseur de quelques centimètres à plusieurs dizaines de centimètres. La minéralisation en Zn-Cu-Ag est liée à un événement plus tardif associé à des veines de quartz et à une altération en chlorite-grenat le long d’une faille de direction nord à pendage vertical qui recoupe tous les types de roche. Cette faille minéralisée est recoupée par la Zone de Cisaillement de Peterson Creek de direction NE. Là ou les zones minéralisée en Ni-Cu et en Zn-Cu-Ag se recoupent, on note des textures magmatiques à l’état reliqual au sein des veines de quartz ou localement de l’altération en chlorite. Les zones mixtes contiennent un assemblage polymétallique inhabituel de Ni, Cu, Zn, Ag et d’éléments du groupe du platine (EGP).

Excerpt taken from abstracts in EMG, Vol. 18, Nos. 1 to 4. Subscribe—www.cim.org/geosoc/indexEMG.cfm

November 2009 | 95

cmq abstracts

Canadian Metallurgical Quarterly Volume 48—Number 2, April 2009 Sintering Fundamentals of Magnesium Powders P. Burke, G.J. Kipouros, Dalhousie University, Halifax, Nova Scotia; D. Fancelli, and V. Laverdiere, Institut Supérieur de Technologies Midi-Pyrénées, Toulouse, France Magnesium and its alloys are attractive materials for use in automotive and aerospace applications because of the low density and good mechanical properties. However, difficulty in forming magnesium and the limited number of available commercial alloys limit their use. This work reviews the efforts to improve the attractiveness of magnesium through non-traditional processing and presents results of current efforts to produce magnesium alloys via powder metallurgy (P/M). P/M can be used to alleviate the formability problem through near-net-shape processing and also allows unique chemical compositions that can lead to new alloys with novel properties. The feasibility of producing magnesium powder metallurgy products utilizing the industrially dominant process of mixed powder blending and controlled atmosphere sintering was investigated using uniaxial die compaction and cold isostatic pressing to form the compacts. Two types of pure magnesium powder were used: one produced by mechanical grinding and the other by centrifugal atomization. The optimal processing conditions (powder size, compaction pressure, sintering time and temperature) were found to maximize sintered density and mechanical properties. On the Contact of Liquid Nickel with Tungsten Carbide or Boron Carbide K.A. Sandy, H. Henein, University of Alberta, Edmonton, Alberta; and K.M. Jaansalu, Montana Tech of the University of Montana, Butte, Montana Metal matrix composites (MMCs), consisting of a ceramic reinforcing phase combined with a tough metal matrix can be applied to steel substrates as wear coatings. The processing behaviour of two nickel matrix MMC’s is investigated: Ni-WC and Ni-B4C. Experiments were designed and carried out where WC or B4C was added to molten nickel. The temperature range was from 1773 to 1973 K, with times of contact between ceramic and nickel ranging from less than one minute to over 30 minutes. The nominal addition of WC ranged from a molar ratio (Ni:ceramic) of 4.2 to 167.0 while B4C additions varied from about 1 to 94. The melt was sampled following the addition of the ceramic. Analysis techniques included chemical analysis, optical microscopy, electron microprobe microanalysis and X-ray diffraction. In the Ni-WC system, a portion of WC reacted resulting in tungsten dissolution into the nickel. Reactions in the Ni-B4C system produced nickel borides, principally Ni3B in the form of a eutectic with nickel and primary nickel dendrites. No B4C was detected in any of the samples utilizing the aforementioned test methods.

Excerpts taken from abstracts in CMQ, Vol. 48, No. 2. Subscribe — www.cmq-online.ca

96 | CIM Magazine | Vol. 4, No. 7

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