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CONTENTS|CONTENU CIM MAGAZINE | DECEMBER 2011 / JANUARY 2012 | DÉCEMBRE 2011 / JANVIER 2012

NEWS 14

Millions in the balance Environmental class action against

The safer, greener China New regulations and help from

Vale may go to Supreme Court by G. Lanktree Western companies like Sparton and CAT are reforming the industry by M. Eisner

18 20 22

Russia adopts international reporting standards World moving towards CRIRSCO benchmark by V. Heffernan Joined at the hip Safety and reliability symposium hosted by CIM and SME cements ties between key ideas by W. Gleason Is resource nationalism the new normal? Finding ways to address a shifting reality at CRU Strategies’ mining risks conference by B. Campbell

À Québec Explo 2011 De grands moyens sont requis pour

On the scene at Quebec Exploration 2011 Investors like

Ontario blitzes target safety Ministry works with Workplace

valoriser le potentiel minéral par A. Castonguay

SIDEX seek to make connections with up-and-coming projects Safety North and mining partners to ensure compliance by K. Lagowski

UPFRONT 30

Winning electrowinning Barrick’s Zaldivar refinery puts Optibar technology through its paces by G. Lanktree

32 34

Vale hauling in a new direction The ups, downs and upside-downs of the new Rail-Veyor transportation system at Copper Cliff by P. Diekmeyer Gas stations in space Shackleton Energy plans to convert the Moon’s water supply to rocket fuel by A. Lopez-Pacheco

36 38

The return of roasting? Refractory ores entice operators to consider new tech by P. Diekmeyer A global community organizer Jean Vavrek leads CIM into a new era of opportunity, at home and abroad by P. Braul

COMMODITY REVIEW The economic engine

51 52 54 55 57 58

Iron ore by E. Moore Gold by D. Zlotnikov Copper by D. Zlotnikov Nickel by E. Moore Zinc by C. Baldwin Uranium by D. Zlotnikov

60 61 62

Potash by E. Moore Diamonds by D Zlotnikov Cement, stone and aggregates by P. Diekmeyer

64 65

Oil sands by C. Baldwin Coal by E. Moore

COLUMNS 75 76 78 80 81 82

Supply Side by J. Baird MAC Economic Commentary by P. Stothart HR Outlook by R. Montpellier Eye on Business by R. B. Phiri and D. Cavvadas Student Life by R. Tottle Standards by D. Fragomeni, L. Urbanoski, T. Lipiec and C. Fleming

83 84 86 87 88 90 91 93 114

Canadians Abroad by H. Ednie Canadians Abroad by R. Andrews Safety by H. Ednie Aboriginal Perspectives by A. Lopez-Pacheco Innovation by T. Hynes Metals Monitor by the staff of Metals Economics Group Women in Mining by H. Ednie Mining Lore by C. Baldwin Voices from industry by F. McMahon and J.-F. Minardi

CIM NEWS

96 From believing to seeing How David Copeland’s instincts and vision brought mining projects to fruition by C. Baldwin

97 Mining and the silver screen Five films make a splash at the second mining film festival in Montreal by H. B. George

FEATURE | ARTICLE VEDETTE 40

L’industrie minière et le grand écran La 98 Understanding the greater picture Hamid

by R. Andrews

deuxième édition du Festival du film minier

Outlook for 2012 A cross-section of the industry reveals core issues for the coming year Perspectives 2012 Des points de vue variés révèlent certains des principaux enjeux pour l’année suivante

Mumin shares insights on iron oxide copper-gold deposits by A. Lopez-Pacheco 99 When preparation meets opportunity Scholarship winner Ella Goldberg is not taking anything for granted by I. Rapoport

100 CIM Calendar of Events 2012 104 CIM National Office staff and CIM Council / Le bureau national de l’ICM et le Conseil de l’ICM

FEATURED PROJECT | PROJET EN VEDETTE 67

Lithium mine is recharged Canada Lithium Corp. looks to reopen their Val-d’Or mine towards the end of 2012 by E. Moore

Remise en exploitation d’une mine de lithium Canada Lithium Corp. prévoit mettre leur mine au Québec en production vers la fin de 2012

TECHNICAL SECTION 108 CIM Journal 109 Canadian Metallurgical Quarterly

IN EVERY ISSUE 6 8 10 12 99 112

Editor’s message President’s note / Mot du president Letters LinkedIn comments Obituaries Professional directory

CIM MEMBERSHIP DIRECTORY / RÉPERTOIRE DES MEMBRES DE L’ICM Available to CIM members only / Disponible aux membres de l’ICM seulement

editor’s letter To everything there is a season Continuity gives us roots; change gives us branches, letting us stretch and grow and reach new heights. ~Pauline R. Kezer

Editor-in-chief Angela Hamlyn, editor@cim.org Managing Editor Joan Tomiuk, jtomiuk@cim.org Senior Editor Ryan Bergen, rbergen@cim.org Section Editors Features:

Ryan Bergen, rbergen@cim.org News and Upfront:

Peter Braul, pbraul@cim.org Columns, CIM News, Histories and Technical Section:

he CIM Magazine editorial team recently stepped back and took a few days to re-examine the magazine. We wanted to ask ourselves whether we were doing things well or “because, well, we have always done them that way.” The result will be a refreshed look for the publication with our coming February issue. The CIM editorial team will also be undergoing some changes in 2012. Both the print and web teams will be growing as we put down new roots and extend new branches. At the same time, one of our section editors, Andrea Nichiporuk, will be going on maternity leave for the next 12 months. Andrea, we hope that you enjoy your time off with your family. As well, our managing editor, Joan Tomiuk, will be retiring this winter after working in the CIM editorial department for the past 14 years. Joan’s professionalism, sharp editing skills, eagle eye for detail and comprehensive knowledge of CIM will be greatly missed. Nevertheless, the legacy of her character and quality work will be the roots that ground us as we continue to grow and evolve. I would like to thank Joan for all that Joan Tomiuk she has taught me, and for her generosity of time and spirit. Thanks for staying the course and maintaining your sense of humour, often into the wee hours of the morning, when we had to meet crazy press deadlines or find creative ways to ensure magazines reached obscure destinations. On behalf of the entire CIM organization, I want to thank you and wish you a joy-filled and meaningful retirement.

Andrea Nichiporuk, anichiporuk@cim.org Hartley Butler George, hbgeorge@cim.org Web Editor Nathan Hall, nhall@cim.org Publisher CIM Contributors Richard Andrews, Jon Baird, Correy Baldwin, Peter Braul, Barbara Campbell, Alain Castonguay, Dimitri Cavvadas, Peter Diekmeyer, Heather Ednie, Marlene Eisner, Chris Fleming, Dominic Fragomeni, Hartley Butler George, William Gleason, Virginia Heffernan, Tom Hynes, Krystyna Lagowski, Graham Lanktree, Tony Lipiec, Alexandra Lopez-Pacheco, Fred McMahon, Jean-Francois Minardi, Ryan Montpellier, Eavan Moore, Reitumetse Benedict Phiri, Irwin Rapoport, Paul Stothart, Rebecca Tottle, Larry Urbanoski, Dan Zlotnikov. Published 8 times a year by CIM 1250 – 3500 de Maisonneuve Blvd. West Westmount, QC, H3Z 3C1 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, NL 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 Janet Jeffery, jjeffery@dvtail.com, ext. 329 Neal Young, nyoung@dvtail.com, ext. 325 Michael Hackett-Pedler, mhackett-pedler@dvtail.com, ext. 317

Angela Hamlyn, Editor-in-chief

Clockwise from left: Andrea Nichiporuk, Peter Braul, Ryan Bergen, Nathan Hall, Angela Hamlyn, Hartley Bulter George This month’s cover Cover design by Clò Communications Inc. Layout and design by Clò Communications Inc. www.clocommunications.com Copyright©2011. 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.

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

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president’s notes Growing beyond Canadian borders CIM members benefit substantially from our Institute’s growing international presence, contacts, activities and membership. Of our current 14,300 members, approximately 2,400 (more than 270 of them students) reside outside of Canada, with close to 900 in the United States. Also, more than 40 per cent of the peer-reviewed papers we have published in the first seven issues of CIM Journal have been authored or co-authored by peers from countries such as Italy, the United Kingdom, the United States, Germany, Australia, India, Russia, Egypt, Jordan, Chile, France and South Africa. Internationally, CIM has a well-earned reputation for high-quality, wellrun and relatively inexpensive conferences and symposia. An impressive 56 countries were represented at the 2011 CIM Conference & Exhibition held in Montreal – this demonstrates the drawing power of our events. Also, the large international presence at our Canadian Mineral Processors Operators’ Conference, Conference of Metallurgists, and Maintenance Engineering/Mine Operators Conference is further proof of our good reputation. In recent years, CIM has worked diligently towards establishing partnership agreements with sister societies on co-hosting international conferences. The first SME-CIM Safety & Reliability Conference was held in Calgary last November; the site for this annual conference will

alternate between the United States and Canada. We will also rotate hosting duties with AusIMM on the biennial International Mine Management Conference kicking off in 2012 in Melbourne; the conference will come to Canada in 2014, possibly in Toronto. Also in 2012, CIM will host the 6th International Conference & Exhibition on Mass Mining (MassMin 2012) in Sudbury. And, in 2016, we will host the International Mineral Processing Conference (IMPC 2016) in Quebec City. Last October, a CIM contingent flew to London, England, for a meeting with the presidents and chief executives of several sister organizations to discuss how we can collaborate globally without stepping on one another’s toes. Organizations in attendance were the Institute of Materials, Minerals and Mining (IOM3, UK), the Australasian Institute of Mining and Metallurgy (AusIMM), the Southern African Institute of Mining and Metallurgy (SAIMM), and the Society for Mining, Metallurgy & Exploration (SME, USA). Discussions will resume in January 2012, led by Bob Schafer, CIM’s incoming president-elect. CIM will continue its efforts to increase its international presence by building the Institute’s international membership, drawing international attendees to our conferences and hosting international conferences. Our goal is to enhance our members’ already considerable technical expertise and provide them with more new and exciting opportunities for knowledge sharing, fellowship, networking and professional development.

Chuck Edwards CIM President

Renforcer notre présence au-delà des frontières canadiennes Les membres de l’ICM tirent d’importants avantages de la présence internationale croissante de notre organisation, ainsi que de ces contacts, de ses activités et adhérents. Des 14 300 membres que notre organisation compte actuellement, environ 2 400 (plus de 270 d’entre eux sont des étudiants) résident à l’extérieur du Canada, dont près de 900 aux États-Unis. Par ailleurs, plus de 40 % des articles évalués par des pairs que nous avons publiés dans les sept premiers numéros de CIM Journal ont été rédigés, seul ou collaboration, par des collègues de divers pays, comme l’Italie, le Royaume-Uni, les États-Unis, l’Allemagne, l’Australie, l’Inde, la Russie, l’Égypte, la Jordanie, le Chili, la France et l’Afrique du Sud. Sur la scène internationale, l’ICM a acquis une réputation bien méritée pour la grande qualité, la bonne organisation et le coût relativement peu élevé de ses conférences et de ses symposiums. Cinquante-six pays étaient représentés au Congrès et Salon commercial 2011 de l’ICM à Montréal, un nombre impressionnant qui montre bien le pouvoir d’attraction de nos activités. L’importante représentation internationale à plusieurs de nos événements, tels le congrès de la Société canadienne du traitement des minerais, le congrès de la Société de la métallurgie et le colloque sur l’ingénierie de maintenance et l’exploitation minière, constitue une preuve supplémentaire de notre bonne réputation. Au cours des dernières années, l’ICM n’a ménagé aucun effort pour établir avec des sociétés sœurs des ententes de partenariats portant sur l’organisation conjointe de congrès internationaux. Le premier événement organisé avec la SME, le Congrès sur la sécurité et la fiabilité, a eu lieu à Calgary en novembre dernier. Ce congrès annuel se déroulera alternativement aux États-Unis et au Canada. De plus, nous organiserons, à tour de rôle avec 8 | CIM Magazine | Vol. 6, No. 8

l’AusIMM, l’International Mine Management Conference, une biennale qui prendra son envol en 2012 à Melbourne. Ce congrès se déroulera au Canada en 2014, possiblement à Toronto. Également en 2012, l’ICM organisera la 6e International Conference & Exhibition on Mass Mining (MassMin 2012) à Sudbury. Enfin, en 2016, nous tiendrons l’International Mineral Processing Conference (IMPC 2016) dans la ville de Québec. En octobre dernier, une délégation de l’ICM s’est envolée à destination de Londres, en Angleterre, afin de participer à une rencontre avec les présidents et les chefs de la direction de plusieurs organisations sœurs visant à déterminer comment nous pouvons collaborer à l’échelle mondiale sans nous marcher sur les pieds. Parmi les organisations présentes, il y avait l’Institute of Materials, Minerals and Mining (IOM3, Royaume-Uni), l’Australasian Institute of Mining and Metallurgy (AusIMM), le Southern African Institute of Mining and Metallurgy (SAIMM) et la Society for Mining, Metallurgy & Exploration (SME, États-Unis). Les pourparlers reprendront en janvier 2012 sous la direction de Bob Schafer, prochain président désigné de l’ICM. L’ICM continuera de s’efforcer de renforcer sa présence internationale en augmentant le nombre de ses adhérents dans le monde, en attirant des participants de partout dans le monde à ses conférences et en organisant des congrès internationaux. Notre but est de rehausser l’expertise technique déjà considérable de nos membres et de leur offrir encore plus de possibilités nouvelles et intéressantes en matière de partage des connaissances, de bourse de recherche, de réseautage et de perfectionnement professionnel. Chuck Edwards Président de l’ICM

letters

A certifiable success

Slipform savoir-faire

SNC-Lavalin Construction Division was granted OHSAS 18001:2007 and ISO 14001:2005 certification by BSI Group, a global leader in business certification for system standards. The company was recognized for its integrated environment and occupational health and safety management system, following audits carried out on a sampling of projects in several countries. The certification acknowledges SNC-Lavalin Construction’s outstanding performance in the completion of major infrastructure projects.

Dear Editor, I read with great interest your article titled “Deep Freeze” (Sept./Oct. 2011, p. 34). I am very familiar with the project as our company, FWS Industrial Projects Ltd, was contracted by AMC to build the concrete pile caps, collar walls (concrete beams) and concrete head frame. We erected the headframe structure utilizing the slipform method of concrete placement. The slipform portion of the new shaft was challenging due to the demanding timelines set for the project. FWS met the challenges of this interesting and innovative project with an excellent safety record. Your readers may find the time lapse video of the slipform headframe erection, which can be viewed at our website, www.fwsgroup.com/mines, both interesting and informative. All of the contractors involved with the project were required to work closely together to ensure that this unique and innovative project was completed successfully.

! u o Y k n

Sc en harf M ri, in so Jill T ing s nA olin F T a he ores F Min s, t i L n r g yO an ak on ada e Sho ntario I r C n P en nc. E e Go ld xpl os tre or nik f off or Ex ation C.J celle nc . St affo e rd &

st a su rata Copper Z b i ltin n dg g Inc aroly G i .C L e dT y ran Mining Compan entu rt ro XV Mo salta De rek Cooper TS ent G t r r t eld anco rison T m co e he Mining Recruit n S ven e nt t Ont ur Tec d ro an k Coa a As l Daniel Parker, Br af Geo rio M rs P and u me ining y s H ta alda logis so a Association Lesley r t Re Ja Ari

ch a so ry Mayer r Ch n m n Xs trata Nickel ki r ite r e Ex d Josh Wo Sal cha u a Ba i l ey u lipe de n Te p L g a e Sally Gillies UBC Fe t c d Le Co ry s ti Re k Me . Andr fine ce e so serv tals In w Pollard The Re esour pora i e c R c. r x s or rs M i M c a A r k R e iat ichards Teme S ie er C ne s M es M licia Fer Silv nanc Inc. SL dina af a i D old & n G r a e d a S F n i a b E Je jivre k Tho lda Arias ices fomin ga C Ray r n Mi r Serv . e n e c i l h n i I K a e v l e C h c a Centu pe Iamg nson lbert S g In iree old C rio A Van t Wilki o n e s A r n p i a R o J r n a t i o t EV stone n Miner ining onsul g, De A als M ,M ury M t i n c R C e e h e C l l n e h H l o g kin eso an R tiona n Hoc o u a w r o r c t h C e a racle Creek Intern s Ala Cana illiton da Peter Wollenberg BHP B

ist i g ne Petch d W a o n r ds ce rs a, Ste en s h ve s awr I y p rp ip P UBS L Th affa es on . Kare artner is Gh s Steev I n e i c s . o R ch , Equ n Rees eB san Has uelin and TetraTe m el C ity E ch Wardrop q s c x h c i o e a p e r Lt n Ho valier loration Consultants Ltd. J t, Min Le C d u im s en Q . He lding Ministr y, T eer ls lopm u i e e y v o e n f I D N n o r r r e t h on O em env nry S Pen e De B an W ya ill re al rian a C y o R k e o m t p a c n y of Canada B Clar ld Br tler, h, , Terr mon-De y G urtis -F Go r i r e Bu a d e b e rg Coffey Mining C g G Loney terr obin n C e a a C r u d n e l r d o t, R R , e s ources Guy Gilro M axine szus ndi O Wiber, N icole McLaren, Ra

Tha

ACHIEVEMENTS

Jim MacDonald Business Development, FWS Industrial Projects Ltd.

n Co ri llb Wa lwar o e Wo Rob F Brett , d a sJ Bro ille ndf G Peter ts o ltan ne B side n Consu a o Re tM m J vey, eber S r Progra u H en S l ical Pau Gold MI) Geolog C y A E ss M Murph (C Brian Bu n s e co l Char ovatio ame Division n C n I n ing tso in Min k Hu c i R es Associat

Dear Mr. MacDonald, Thanks you for the note and the added insight into the project. The video is a good graphic summary of the impressive coordination required to execute this project. I wish you a prosperous 2012. Regards, Ryan Bergen, Senior editor, CIM Magazine

Erratum Foreign Exchange

We would like to thank our volunteer Speakers and Virtual MineMentors for your continued support and engagement in the Explore for More Career Outreach initiative. We’d also like to extend a special thank you to BHP Billiton, official sponsor of the Virtual MineMentor Program.

Visit www.acareerinmining.ca to learn more about becoming a Speaker or Virtual MineMentor.

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

The image in the article “Deep freeze” (CIM Magazine, Sept./Oct. 2011, p. 34) was not shaft-sinking work at PotashCorp’s Scissors Creek site, as described in the caption. In fact, the photo represented a shaft-sinking crew for Redpath Mining at the Oyu Tolgoi site in Mongolia. We regret the error. Ryan Bergen, Senior editor, CIM Magazine

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CIM’s LinkedIn group provides enlightening feedback CIM currently boasts over 3,000 members on LinkedIn. Join us today and get involved in the compelling dialogue. Below are a few of the myriad LinkedIn comments received daily in response to CIM Magazine’s editorial topics.

What practical ways can mining companies improve community relations? Doing it right the first time: November 2011, Vol. 6, No. 7, p. 68 wow, where to start? The key word here is “practical.” So many firms spend significant community relations/investment funds on developing their approach to engaging with stakeholder communities. Sadly, this planning seems to develop only a limited series of projects or process of engagement that reflects “outsider” impressions of impacted communities, not the real needs and interest of locals. In many cases, dedicating some funds to identifying local concerns, interests and expectations around mining will go a long way towards making meaningful community investments and improving company/community relations. Taking the time to fully understand local issues and concerns will enable mining firms to engage in practical local solutions and initiatives that may actually cost less, and be more meaningful to community members than the projects that upper-management within the firm might conceive of. For example, one community that I’ve worked with requested back-haul privileges on surveying/exploration helicopters that were very well received. In another case, a community requested a couple of minivans to serve as local taxis for the First Nation – not a large investment, but one that was very meaningful to local elders who are less mobile during the winter months. Practical, in this sense, doesn’t mean that a mining firm needs to fund/construct an arena or community centre everywhere they operate; but it does mean that they should take the time to identify how their community investment budget, or IBA terms, could make a substantial contribution to local quality of life. These are the sorts of things that will help build relationships with stakeholder communities, but the process by which these are identified, delivered and/or maintained must also build these relationships. Delivering 100 boats/motors to local fishermen will be a wasted effort if the local First Nation develops the perception that they had to “wrangle those benefits from the mining company.” Managing expectations is a key part of any relationship, and this must be a priority in any attempt to build relationships with stakeholder communities. Peter Siebenmorgen, Lead Research Consultant – Ring of Fire Community well-Being Studies, Toronto, Ontario, Canada

Here are my recommendations: Drop the arrogance. Stop thinking you are always right or are any better than the people that live in the community. Get the right people for your team. Beware of the people

that tell you what you want to hear; size up their competencies, listening ability, managerial courage, and their ability to manage through systems. Get a genuine interest in the people and their communal needs. Research their needs face to face and on the ground, and always “walk the talk” (under-promise and over-deliver). Use just as rigorous a process for your CSR as you would use for your core mining processes. Start early in your development. Deploy your CSR people early in the exploration phase, building goodwill right at the beginning of your presence in the area. Benchmark and learn from the best companies. Finally, be patient. There has been a lot of damage done in the past. The process of mending things and becoming sustainable is long-term, and we in mining may have the pressure of doing things for yesterday. It is like planting trees, the best time to do it was 20 years ago, but the second best time is now! Bertrand De Windt, Senior Executive Business Consultant, Peru

I think the biggest challenge that mining companies face in underdeveloped countries like mine (Guinea) is community relations. I have seen communities block trains and plant entrances for days due to a lack of good community relations. There are no structured communication channels between companies and communities. This is changing now in Guinea because of the involvement of some NGOs and some slight local governmental restructuring towards a more decentralized state. Companies should try to understand expectations and find sustainable approaches to community projects. Saada Baila Ly, Managing Director, National Society of Mining Infrastructures

Taking it into a more global perspective, things are beginning to change given that many of the top companies carrying out mining around the world are from Canada. The lessons learned here are starting to impact the way business is done abroad. Having visited and analyzed the situation in many countries around the world, but particularly in my native area (Central America), I truly do wish that Bill C-300 had not been defeated. Things in the south have the volatility to turn quickly into large-scale campaigns and movements. Two years ago when I landed in Guatemala to chat with a few organizations, there were 8,000 people marching in front of the Canadian embassy denouncing ill treatment from Goldcorp. Most recently, the Newmont nightmare of a $4.8 billion investment having the potential of derailment over environmental concerns and community unease will send out an alarm bell to the rest of the industry with a message of the importance that CSR and environmental protection play in the success of the project.

SCAN THE QR CODE wITH yOUR SMART PHONE TO BE TAkEN DIRECTLy TO CIM’S LINkEDIN PAGE. 12 | CIM Magazine | Vol. 6, No. 8

Juan Carlos Reyes, Lead Consultant, efficiency.ca, London, Ontario

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news Millions in the balance Vale class action case may go to Supreme Court

A landmark environmental class action lawsuit brought by the residents of Port Colborne, Ontario, against Brazilian mining giant Vale S.A. may be headed to the Supreme Court of Canada, said the plaintiff’s lawyer, Eric K. Gillespie. In 2010, his clients had been awarded $36 million, but that was overturned by the Ontario Court of appeal in October 2011. In early December, Gillespie asked Canada’s top court for leave to appeal that decision. “The Court of Appeal’s decision has raised a number of concerns for people in the legal profession,” Gillespie said. “They think it will have a significant effect in reducing people’s ability to bring environmental class actions.” The case against Vale, known as Smith v. Inco Ltd., involves 7,000 people who have owned residential property in Port Colborne since 2000. They argue that property values have been impacted by contamination from the Inco nickel refinery that Vale’s nickel refinery in Port Colborne operated between 1918 and 1984, when it was owned operated in their city between 1918 and 1984, and by Inco. negative press in 2000 that followed broad public disclosure of the contamination. They sought compensation The Court of Appeal’s decision to overturn the ruling from Vale after it bought Inco in 2006. hinged on the conclusion that the standard of strict liability, As the case stands now, industrial companies can take established in an 1868 English case, did not apply. The stancomfort that a claim of nuisance would have to be substan- dard weighs whether a company is legally responsible for tial in order for the plaintiffs to be awarded damages. “In the damage and loss resulting from its actions or omissions. In case of Smith v. Inco Ltd., the simple fact that nickel emis- the English case, a landowner was found in the wrong after a sions changed the chemical composition of the soil wasn’t water reservoir built over a neighbour’s mine flooded the pit. enough,” said Steven F. Rosenhek, a partner in the legal firm But whereas the reservoir failed catastrophically, Inco’s Fasken Martineau DuMoulin LLP, who often handles class refinery had impacts on its surroundings from normal use. action cases. The words from the original case considered the reservoir a “Many of the concerns that people have about environ- “non-natural” use of the land because it brought quantities mental damage are not about physical damage or physical of water to the property that weren’t originally found there. injury,” Rosenhek added. In making their case, the plaintiffs “Yet the Court of Appeal appears to have focused on did not claim that nickel contamination had affected their whether the use by Inco was a licensed or appropriate use,” health, nor the use of their properties. “If the Court of said Gillespie. “This decision appears to have opened up a Appeal’s ruling stands, you can’t just say you have a concern; debate about how those original words should be correctly you actually have to show there was some kind of damage,” interpreted.” In the eyes of the Court of Appeal, the Inco he explained. “It would eliminate a lot of complaints.” facility was not a “non-natural” use of the property, as it After an application for leave to appeal is filed, it can be complied with all the relevant environmental laws. six to nine months before the Supreme Court reaches a deciIf the original trial judgment were restored in the Port sion on whether to hear the case. But Gillespie believes Colborne case, the mining industry would have to worry there’s a good argument for it to go through. “The court is about effects that did not amount to physical harm, said going to be determining if there are matters or issues of Rosenhek. “Parties could complain about their concerns national importance that go beyond the concerns of the about health rather than having to prove tangible health individual parties,” he said. “The law around private nui- impacts or a realistic risk of such impacts,” he pointed sance that appeared to be well settled has now become out. As such, the case could have a wide impact on operuncertain. The Court of Appeal’s standard of having to prove ations such as Alberta’s oil sands and other extraction or significant health risks, if not actual harm, changes the law.” refining projects. CIM 14 | CIM Magazine | Vol. 6, No. 8

Courtesy of Vale

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news The safer, greener China Tough new regulations have closed thousands of mines – and created opportunity

The numbers seem astounding: of the more than 100,000 mines in China, close to a third of them are slated to be closed within the next 10 years. The closures are evidence of the continuing struggle by the Chinese government to reform its antiquated mining industry. And, it is a trend that promises opportunity to those who establish themselves within the growing industrial powerhouse. “A lot of these mines are very small,” explained Lee Barker, president and CEO of Sparton Resources, which has been active in China for the last nine years Workers at Sparton Resources’ Huajun coal and germanium operation in Yunnan, China. The Huajun Coal Mining Company, which is controlled by Sparton, was formed by the consolidation of three smaller mines. – the company operates a joint-venture germanium mine and is also developing a vana“Here, those small mines are mining modern operations has mining equipdium deposit. “When we think of a five or 10 tonnes a day, that’s all.” ment manufacturers working hard to mine in the West, we think of 500 to The move to shut down small mines stake their claims in this rich territory. 500,000 tonnes a day,” said Barker. or to consolidate them into larger scale, In November, Caterpillar purchased

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

Marko Moudrak

By Marlene Eisner

news ERA Mining Machinery, which was a major supplier to the Chinese coal mining sector. Earlier in the year, Joy Global increased its stake in a manufacturer of longwall coal mining equipment. “The China coal market is large and diverse, and must be accessed with a multi-dimensional strategy,” explained Mike Sutherlin, the company’s president and CEO, when the acquisition was announced. “While the major mines generally use globally sourced equipment, a larger number of mines rely on local Chinese mining equipment manufacturers. Leadership in the China market requires strong positions specific to each segment.” David Feickert, a New Zealandbased mine safety adviser, works with coal mines in China to identify and resolve safety issues, where, he said, the situation has improved significantly in the last few years. “Since 2007 it has become clear that the government’s determination to really deal with the small private mine issue meant the closure of thousands of mines, or their merger into large state-owned mines nearby,” he explained. “This was a clear safety-based decision, as the largest percentage of miners was being killed in these mines.” Feickert added that the number of deaths due to mining accidents is expected to be 2,400 this year, less than a third of the number reported in 2002. “China’s coal industry has moved rapidly forward from 10 years ago, when disasters were usually large scale,” he said. The safety of workers is not the only target of China’s sweeping policy changes. The environmental impact of mining operations is also a major focus. Geologists Jeffery Zhou of the China University of Geosciences and Dirk van Zyl of the University of British Columbia have studied and written about the Chinese government’s “Twelfth Five-Year Plan” (2011-2015) to “green” the industry and galvanize environmental protection. They have drawn attention to a

2005 government survey, which chronicled 12,379 mining geologic hazards that caused 4,251 deaths or injuries, and also to a continuous rainfall last July that resulted in a breach in the clay liner of a tailings pond at a copper mine, killing 1,890 tonnes of fish. While these tragedies haunt the industry, growing attention to the environment has been a boon for BioteQ Environmental Technologies of Vancouver. The water treatment firm has been developing their project portfolio in China since 2006 when it formed a joint venture with the Jiangxi Copper Company. The treatment plant installed at the Dexing copper mine removes heavy metals from the water discharged from the mine, waste dumps and ore stockpiles, and allows the water to be reused at the mine. The company has since identified six potential sites for their water treatment plants and is in the process of building a

second treatment circuit at the Dexing Mine. “China has been very committed to improving its environmental regulations and, more importantly, enforcing those environmental regulations,” said Tanja McQueen, vicepresident of corporate development at BioteQ. China’s push to move forward was the catalyst for BioteQ getting involved. “What we saw was a change in regulation that encouraged mining companies to think differently about how mining impacted water,” she said. McQueen noted that when BioteQ first arrived, the copper mine lagged not just in environmental procedure, but in safety standards as well, which turned out to be another opportunity for the company. “We introduced our safety standards there,” she said, “and they were embraced and became part of the standard operating procedure at that site.” CIM

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news Russia adopts international reporting standards Common code designed to boost investor confidence

Courtesy of CRIRSCO

By Virginia Heffernan

Grigoriy Malukhin (left), the Russian representative at CRIRSCO, applauds as Deborah McCombe shakes hands with Yuri Podturkin, chairman of the managing committee at NAEN.

Russia has adopted international reporting standards that will smooth the way for its mining companies to list on international stock exchanges. The country joins Canada, the United States, South Africa, Australasia, Europe and Chile as a member of the Committee for Mineral Reserves International Reporting Standards (CRIRSCO), the international authority for reporting exploration results and mineral resources and reserves.

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

Use of the Russian code (or NAEN code) will allow Russian professional geologists to integrate with the international geological community. “Russian specialists will be able to act as Competent Persons and prepare reports on exploration results and mineral resources and reserves for raising capital and listing on major trading floors both in Russia and worldwide,” said Grigoriy Malukhin, the Russian representative for CRIRSCO.

“If you’re classifying a resource according to the Russian code, then that would be similar if not identical to a resource that is prepared under National Instrument 43-101,” said Toronto-based Deborah McCombe, CRIRSCO’s chairperson, who added that the new code will likely encourage Russian listings on the London and perhaps Toronto stock exchanges. “It gives investors confidence in Russian technical reports because the reports are prepared to a standard they are familiar with.” CRIRSCO was established in 1994 as an informal group that evolved into a more rigorous organization as mineral exploration increasingly crossed borders. The committee’s international reporting template, which forms the basis of the Russian code, was first published in 2006. The template provides a way for countries to adopt standards that are recognized worldwide for market-related reporting and financial investment, while allowing room for country-specific regulations. Current CRIRSCO members represent about 80 per cent of the listed capital of the global mining industry. Prospective new members include Mongolia, the Philippines and Turkey. CIM

news Joined at the hip Safety and reliability at the forefront of CIM/SME symposium

Without safety, nothing else matters. This message was told and retold by representatives from some of the world’s top mining and petroleum companies who had gathered for the inaugural Safety and Reliability in the Mining and Resources Industries symposium. Hosted by CIM and the Society for Mining, Metallurgy and Exploration (SME), the symposium broke new ground in both fields. More than 180 people attended the two-day conference at the Westin Calgary, in which the message of reliability was linked tightly with that of safety. During the plenary address, Gary Goldberg, then-president and CEO of Rio Tinto Minerals (currently executive vice-pres- Trucks are emblazoned with safety reminders as part of Teck’s Courageous Safety Leadership initiative. Robin Sheremeta, the company’s vice-president of health and safety leadership, presented at the safety and reliability symposium. ident and COO with Newmont Mining Corporation), and Robin Sheremeta, vice-president of lead to a culture of just getting by, and engage in discussions around the chalhealth and safety leadership at Teck lenges within our organization, such as you will never be able to achieve safety Resources, spoke about the efforts that excellence in that culture,” said Judy normalization of deviance, complaAgnew, author of Safe by Accident? and have been made by their respective cency, communication and maintaincompanies to improve not only the ing a sense of vulnerability.” Sheremeta safety session keynote presenter. “You safety statistics at their operations, but went on to say that because of these need to focus on hazard mitigation also to create a working culture in efforts, Teck is “having fewer serious and behaviour change.” Agnew spoke passionately about which the safety of every person on site incidents than ever before and our the need to use behavioural science to company is more engaged in safety is of utmost importance. improve safety through a better under“Safety is the most important job I than it has ever been.” standing of the true root of at-risk John Rhind, Shell Canada’s vicehave,” said Goldberg, who at the time behaviour. When an accident occurs, oversaw 1,500 employees for Rio president of heavy oil industries, and rather than attempting to find who is Tinto. He went on to explain how Rio Raymond Floyd, Suncor Energy’s senaccountable and punishing them, she ior vice-president of maintenance, set Tinto is working to identify strong said, companies need to figure out leaders and systems to create a safer the tone of the reliability track during who needs to do what to prevent it their plenary addresses by illustrating workforce that will, in turn, create a from ever happening again. Once this how a reliable, well-maintained workmore productive workforce. has been established, those responsisite not only leads to increased producSheremeta spoke of Teck Resources’ ble for implementing preventive meastivity, but to increased safety as well. Courageous Safety Leadership (CSL) ures must be held accountable for As risk continues to grow for mine initiative, which began in 2009. “CSL doing so. Agnew called this “forwardoperators, the push is on for a parais a full day of training where we digm shift in mining culture that prior- looking accountability,” and maintains explore the values of our company, the that simple, backward-looking disciitizes safety in order to ensure reliable beliefs of our culture, the attitudes and plinary action will not solve problems. operations. “Negative consequences behaviours of all of us,” he said. “We 20 | CIM Magazine | Vol. 6, No. 8

Courtesy of Teck

By William Gleason

news Keynote presenter, Jim ReyesPicknell, president of Conscious Asset Management, kicked off the reliability session with a discussion about reliability-centred maintenance. He pointed out that in the right environment, reliability-centred maintenance can be extended to minimize capital expenses and operational expenses and risks, and can even be part of the broader field of asset management. And while many of the advancements in safety and reliability have come from behavioural and cultural changes, the role of technology cannot be overlooked. A group of mining companies established the Earth Moving Equipment Safety Roundtable (EMESRT) in 2006 in order to influence equipment design by engaging manufacturers. Newmont Mining Corp.’s principal mine engineer, Ben Scholz, said EMESRT hopes to identify safety risks and other problems in

the design phase, rather than afterwards when remedies can be very costly. By integrating an evaluation of safety in equipment design as a part of purchasing specifications, those involved with EMESRT hope the global mining industry will reward original equipment manufacturers with safer designs by having a procurement strategy that always selects the safest equipment. In the conference’s closing session, Greg Baiden, a professor of engineering at Laurentian University and CEO of Penguin Automated Systems Inc., high-

lighted the important role that automation will play as the industry goes beyond the bounds of the Earth and moves to mining operations on the Moon. According to Baiden, whose presentation was called “Mines of the future – safety and reliability will drive robotics and automation,” an increasing number of factors are pushing the industry towards safe automation and away from human danger. Next year’s safety and reliability symposium will be held in Minneapolis, Minnesota, USA, November 13-15. CIM

ACHIEVEMENTS Cheers for De Beers De Beers Canada was recognized at the Mining Association of Canada’s (MAC) annual Mining Day on the Hill. MAC presented its 2010 Towards Sustainable Mining awards, recognizing Canadian mining facilities that have demonstrated excellence in corporate social responsibility. De Beers Canada’s corporate office was acknowledged with an award in crisis management planning.

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December 2011 / January 2012 | 21

news Is resource nationalism the new normal? Summit explores opportunities in an increasingly risky environment

Fiscal intervention is here to stay, according to Luis Mualim, vice-president of risk and audit at Antofagasta Minerals. He spoke at the 2011 Mining Business Risks Summit held in Toronto on October 25 and 26, and was not alone in his concern that resource nationalism is set to change the face of the mining industry. There were 115 delegates this year – about 20 more than last year’s inaugural event in Vancouver. “We have a new guest at the table,” said Mualim, who hails from Chile, where Antofagasta has four copper mines, as well as a railway. “We have to learn to live with a new normal,” he said. Mualim reminded delegates attending the event that resource nationalism now claims the number one risk spot for mining and metals companies as governments worldwide seek a greater share of the profits through measures like taxes, royalties and increased local participation in projects. Risk is indeed on the rise worldwide. “Three-quarters of the mining jurisdictions have demonstrated

Oil Sands

& Heavy Oil

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

Courtesy of Presidencia Peru

By Barbara L. Campbell

Peruvian president Ollanta Humala was elected in 2011 on a platform that promised to distribute the wealth from the country's natural resources. Immediately following his election, the Lima stock exchange plummeted 12 per cent on fears that resource nationalism would inhibit foreign mining companies.

increased relative risk over the past year,” said Robin Adams, managing consultant at CRU Strategies, citing key countries such as Australia, Brazil, India and South Africa. Mualim made reference to Ernst & Young’s report, “Business Risks Facing Mining and Metals 2011-2012,” which

showed resource nationalism jumping from fourth place in the past year to first. According to the report, the rise of this particular risk flows from the mining sector’s relatively speedy rebound after the global financial crisis of 2008. As a result of booming business, some countries struggling to

generate revenue have begun to see profitable mining companies operating within their borders as potential solutions to their financial woes. The topic of resource nationalism was never far beneath the surface throughout the summit, which offered insights and tips to help delegates tackle risks effectively and proactively. And although risk was under the microscope, the overall message was far from negative. Fiscal intervention generates instability and uncertainty, according to Mualim, but companies that acknowledge, anticipate and mitigate risks – and forge transparent relationships with host governments – can look forward to novel and exciting opportunities. “Countries with copper potential should be on the radar,” said Mualim, who sees sustained growth for mining over the next decade. “Urbanization in China, India and Africa is of an unprecedented scale and will drive demand for infrastructure and consumer minerals.” In today’s economy, no jurisdiction is insulated from change, and mining risk is in flux at home as well as abroad. Jean Masson, a partner at Fasken Martineau DuMoulin, outlined what he sees coming in Quebec in light of the province’s Plan Nord. “The mining industry will be the driving force behind this development,” he said, describing opportunities throughout the province. However, Masson also expressed concern about whether permits can be issued within reasonable timeframes and that “the Ministry of Sustainable Development, Environment and Parks lacks the resources to diligently examine the projects that have been submitted for review.” There were other bright spots as well, as mining companies have made great strides in mitigating environmental risk. John Gardner, director of environment and sustainability at Alcoa, delivered an inspiring account of the advances his company has made to meet sustainability challenges in Western Australia. “We have taken a very scientific-based approach to developing a restoration program,” said Gardner, a biologist himself. Alcoa has rehabilitated three-quarters of the area where it began mining bauxite in 1962, and returned close to 100 per cent of the native plants, animals, birds and reptiles. The company has also addressed pollution, with continual monitoring of water quality through to mitigating the effects of noise, even issuing text messages alerting local dairy farmers when blasting is imminent. Such activities can certainly boost the mining industry’s reputation among NGOs like World Wildlife Fund Canada, whose vice-president of strategic partnerships, Hadley Archer, gave a bird’s-eye view of his organization’s perspective. Archer was quick to pinpoint relationships his organization is building with companies such as De Beers Canada and, most recently, Goldcorp. But much more work is needed, he warned. If biodiversity decline continues as it has since the organization was formed in the 1960s, he said, “by 2030, we will need two planets to sustain us.” CIM

Making your world secure

Draw on our expertise

Contact me for more information: Cy King Email: cking@garda.ca T: 780.791.7087

For 2012, the summit will again be in Toronto. For more information, visit www.miningrisks.com December 2011 / January 2012 | 23

news À Québec Explo 2011 De grands moyens sont requis pour valoriser le potentiel minéral

Une foule record de 2100 personnes et 130 exposants a participé à Québec Exploration 2011, qui se déroulait du 22 au 24 novembre au château Frontenac, à Québec, sous le thème « De la connaissance à la découverte ». La frénésie qui s’est emparée du secteur minier depuis le lancement du Plan Nord par le gouvernement du Québec était perceptible. Géologie Québec a d’ailleurs dévoilé pas moins de 62 nouvelles cibles d’exploration, tandis que l’Institut de la statistique a annoncé que les investissements en exploration minière avaient atteint 639 millions $ en 2010. Et au grand plaisir des participants, c’est le premier ministre Jean Charest lui-même qui clôturait l’événement. Certes, si le Plan Nord est encore tout chaud, les gisements auxquels il donnera accès sont quant à eux documentés depuis des décennies, a d’abord tenu à rappeler Michel Gauthier, président d’honneur de Québec Explo 2011 et professeur de géologie à l’UQÀM. Par exemple, l’exploitation de nouvelles mines dans la fosse du Labrador, qui s’étend de Schefferville jusqu’à la baie d’Ungava, sera menée dans des gisements connus depuis les années 1950. Bien sûr, en améliorant l’accès à certains secteurs, le Plan Nord du gouvernement Charest crée un climat favorable, reconnaît M. Gauthier. Mais le contexte de l’exploration changera peu, selon lui. Ghislain Poirier, président sortant de l’AEMQ, a quant à lui déploré les impacts possibles du projet de loi 14, qui révise la Loi sur les mines, et plus particulièrement de l’amendement qui obligera les entreprises à demander des permis aux municipalités ou aux MRC avant d’explorer. La rareté du financement figurait également au cœur des préoccupations de 24 | CIM Magazine | Vol. 6, No. 8

Courtoisie de GéoMéga

Par Alain Castonguay

Le camp de la propriété Montviel de GéoMéga dans le nord du Québec. SIDEX a investie 800 000 $ dans la compagnie pour financer les travaux d’exploration de terre rare en juillet 2011.

M. Poirier. « En temps normal, quand le prix des commodités est élevé, le financement est facile. Quand ça baisse, c’est la même chose. Nous sommes dans un sommet pour les prix, mais le financement est rare », at-il déclaré. M. Poirier n’était visiblement pas le seul à s’en inquiéter. Des entrepreneurs et des dirigeants de sociétés d’investissement ont traité plus spécifiquement du financement public, soulignant une conjoncture défavorable pour les sociétés émergentes. Si les actions accréditives ont permis de relancer l’exploration au Québec depuis 2004, leurs détenteurs exigent des résultats rapides, jugent-ils. Du côté des investisseurs, Michel Champagne, de la Société d’investissement dans la diversification de l’exploration (SIDEX), a tenu à réitérer l’importance de la confiance à l’égard des entrepreneurs. « Nous avons intérêt à bien nous entendre avec eux, à bien les comprendre, car

nous devrons ensuite convaincre d’autres investisseurs lorsque leur projet exigera de nouveaux fonds », a-t-il dit. La sous-représentation des sociétés québécoises à la bourse a elle aussi été évoquée. Au 30 juin dernier, 1592 sociétés minières étaient inscrites au TSX-Croissance, ce qui classe la bourse de Toronto au premier rang mondial des places boursières du secteur minier. Mais selon les chiffres fournis par Louis Doyle, du Groupe TSX, le nombre de nouvelles inscriptions en bourse en provenance du Québec est ridiculement bas. En trois ans, seulement 17 sociétés minières québécoises se sont inscrites en bourse. Pour remédier à cette anomalie, le gouvernement a d’ailleurs annoncé, le 14 novembre dernier, la création d’une nouvelle chaire universitaire sur l’entrepreneuriat minier, codirigée par Suzanne Durand, professeure en sciences de la gestion à l’UQAT, et

news aux requis pour la purification à chaleur élevée et la chimie des solutions. Il y a toute une science à

Roch Théroux, MRNF

Michel Jébrak, professeur de géologie à l’UQÀM. Finalement, le manque d’expertise a lui aussi été abordé, notamment par Normand Grégoire, directeur de projets, économie et développement stratégique, à Génivar, qui y voit l’un des principaux défis de l’industrie québécoise en ce qui a trait aux minéraux et métaux critiques, stratégiques et de haute technologie. Car si plusieurs nouvelles substances primaires suscitent la convoitise, tel le lithium, les procédés de valorisation sont encore méconnus. Certains gisements miniers comportent aussi des substances secondaires qui gagneraient à être mises en valeur. Mais on a besoin de résultats en laboratoire pour passer à l’étude de faisabilité, et les chercheurs sont déjà débordés, estime-t-il. « Nous apprenons sur le tas les recettes, les procédures et les matéri-

Des exposants qui discutent des nouveaux développements à Québec Exploration 2011.

redécouvrir et à mettre au point pour que les projets fonctionnent », a-t-il affirmé. Même dans les usines de transformation, ce besoin de nouvelles ressources humaines se fera sentir. « Dans bien des cas, l’ingénieur minier spécialiste des minerais sera remplacé par un chimiste qui devra faire fonctionner l’usine. L’analyse de ces procédés non éprouvés ou sans comparatifs ailleurs aura des conséquences sur nos études de faisabilité, en plus de modifier le travail des fabricants d’équipements », a conclu M. Grégoire. Quelque peu victime de son succès, Géologie Québec, qui organise l’événement avec l’Association de l’exploration minière du Québec (AEMQ), a annoncé que l’édition 2012 se tiendra au Centre des congrès de Québec, où les participants seront moins à l’étroit que dans le vénérable hôtel du Vieux-Québec. ICM

December 2011 / January 2012 | 25

news On the scene at Quebec Exploration 2011 A big push is needed to promote mining potential A record crowd of 2,100 delegates and 130 exhibitors participated in the 2011 Quebec Exploration conference at Quebec City’s Château Frontenac Hotel in November. The frenzy created by the Government of Quebec’s Plan Nord was clearly in the air. Géologie Québec revealed 62 new targets for exploration, while the Quebec Institute of Statistics announced that mining exploration investments reached $639 million in 2010. And Premier Jean Charest himself was on hand to close the event. Nevertheless, scarcity of financing remains a subject of great concern in La Belle Province. “Under normal circumstances, when commodity prices are high, financing is easy,” said Ghis-

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

lain Poirier, outgoing president of the Quebec Mineral Exploration Association (AEMQ). “We are reaching a summit for prices, but financing is scarce.” And Poirier is not alone in his apprehension. Several entrepreneurs and heads of investment companies spoke about public financing, stressing the unfavourable conditions for emerging companies. Although flowthrough shares have enabled a resurgence in mining exploration in Quebec since 2004, they explained, shareholders expect swift results. From the investors’ perspective, Michel Champagne, from the Diversification of Exploration Investment Partnership (SIDEX), reiterated the importance of their relationship with entrepreneurs. “It is in our best

interest to get along well with them and to understand them because we will need to draw in new investors once their projects require new funds,” he said. Under-representation of Quebec companies on the stock market was another subject of heated discussion. As of June 30, 1,592 mining companies were registered on the TSX Venture Exchange, making the Toronto Exchange the premier marketplace for the exploration and development sector. However, according to numbers provided by Louis Doyle from the TSX Group, the number of new registrations on the Venture Exchange from Quebec is extremely low. In three years, only 17 mining companies from Quebec have

registered on the market. By comparison, 31 Ontarioheadquartered companies were listed on the TSX Venture in 2010 alone. In the hopes of correcting this anomaly, on November 14, the Quebec government announced the formation of a new university research chair in mining entrepreneurship, co-directed by Suzanne Durand, professor of business administration at the Université du Québec en Abitibi-Témiscamingue (UQAT), and Michel Jébrak, professor of geology at the Université du Québec à Montréal (UQÀM). Lack of expertise was highlighted as a major issue in the province, notably by Normand Grégoire, director of projects, economy and development strategy at Genivar. Although many new resources, such as lithium, are attracting attention in Quebec, the processes for refining them have yet to be perfected. Certain mineral deposits also have secondary substances that would be worth promoting, but more laboratory tests are necessary before moving towards feasibility studies, and Grégoire thinks researchers are already overloaded. “We are learning about the procedures required for purification at high temperatures and the chemistry of solutions as we go,” he said. “There is a whole science to rediscover and to perfect so that projects may succeed.” Even in processing plants, the need for new human resources will be felt. “In many cases, a mining engineer who specializes in ores will be replaced by a chemist who will have to make the plant run,” Grégoire explained. “Analyzing these new processes, which have yet to be tested or which have no outside equivalents, will have an impact on our feasibility studies, and will modify the work of equipment manufacturers.” Although the exploration potential of Plan Nord remains a hot topic, the deposits that will most immediately benefit from infrastructure development have been well documented for decades, noted Michel Gauthier, honorary president of Quebec Exploration 2011 and a geology professor at UQÀM. For example, the development of new mines in the Labrador Trough, which stretches from Schefferville to Ungava Bay, would exploit deposits that have been identified since the 1950s. By improving access to certain sectors, the Charest government’s plan will help to create more favourable conditions, Gauthier recognizes. But he also doubts that the context for mining exploration will change significantly, except for improving access to certain areas. Mention the extension of Highway 167 towards the Matoush and Renard projects and he’ll crack a smile. “Building 240 kilometres of roads is great,” he said. “But we were a lot more ambitious in the 1950s, when we built 700 kilometres of railway between Schefferville and Sept-Îles.” Due to the success of this year’s event, organizers Géologie Québec and AEMQ announced that the 2012 conference will be held at the Quebec City Convention Centre, where participants will enjoy more space. CIM

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December 2011 / January 2012 | 27

news Ontario blitzes target safety Ministry works with mining partners to ensure compliance By Krystyna Lagowski

Courtesy of Workplace Safety North

Workplace Safety North ventilation specialist Philip Dirige uses a velometer to measure air velocity in an underground airway, during a workshop in Sudbury in February 2011.

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Last summer, 61 site visits yielded 63 stop work orders at Ontario diamond drilling operations. Another 13 were handed out following 123 workplace visits to pits and quarries as a part of the ongoing safety inspection blitz program by the province's Ministry of Labour (MOL). The objective of the program, which covers the construction, health care, industrial and mining sectors, is not to punish, but to proactively zero in on specific hazards that commonly affect industry. And despite the name, safety blitzes are not catching mine operators off guard. “A lot of planning goes into the blitzes,” said Bob Barclay, provincial coordinator of mining, health and safety for MOL. “We make a great deal of effort to publicize what we’ll be looking for. The priorities of each blitz are announced on our website. Mining operators know about it in advance and shouldn’t be surprised.” The planning starts with MOL staff examining the statistics of injuries, fatalities, work orders and Workplace Safety and Insurance Board data. They identify specific high-risk areas to target; in the recent pit and quarry blitzes, these included conveyer belts, rock crushers and vibrating screens. Finally, hazards are quantified and ranked using pre-existing data collected from MOL field inspectors.

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“The blitz criteria include input from the safe work associations, Ministry staff, and mining health and safety program specialists who provide direction for selecting workplaces for inclusion in the blitz,” said MOL spokesperson William Lin, Workplaces are targeted if they have poor injury records, a history of noncompliance with the Occupational Health and Safety Act and, in some cases, the presence of new or vulnerable workers. While the overall blitz program is well publicized, individual locations are not given prior warning that an inspector will be coming. There are three types of orders inspectors can issue as they see fit: a time order, a stop work order and a forthwith order. At diamond drilling sites, for example, the stop work orders accounted for just less than a third of the 191 orders inspectors issued. “A time order is issued when there is an issue of compliance but no imminent danger to employees,” said Barclay. “The mine operator may have to provide a compliance plan detailing what measures will be taken to comply with the order. These measures may include an engineer’s report or new equipment, which may take months to complete.” A stop work order is issued when there is imminent danger. “Work is literally stopped until the problem is rectified,” said Barclay. “Only the inspector can lift the order.” When there is an immediate danger if that must be corrected, for example, a hole in the ground is not barricaded, the inspector issues a forthwith order. The problem must be corrected before the inspector leaves. Usually, inspectors must make four visits as part of a blitz to ensure the job is done thoroughly and all criteria are met. To better comply with regulations, operators have gotten help from Workplace Safety North (WSN) to prepare for visits. Before October and

November’s blitz on ventilation hazards, WSN, together with MOL, offered an hour-long webinar. “The Ministry offered a brief presentation on what the blitz entailed, what sections of the regulations they would be covering, and what procedures they would be following,” said Dwayne Plamondon, WSN vice-president northeast and mine rescue. “We gave an overview of products and services that could help companies cope with the blitz.” Approximately 35 people attended the webinar, including ventilation engineers, operators and people who work in the mines that would be directly affected by the blitz. WSN also held a workshop where individuals did hands-on exercises in a NORCAT underground training facility: they measured airflow underground on duct ventilation and learned the proper way to take measurements, using a WSN 165-page auxiliary mine ventilation manual. Webinars and workshops are held regularly to help mining companies to get ready for blitzes. “They don’t want to find anything out of compliance,” said Plamondon. Ontario has 22 inspectors assigned to the blitzes, spread across the

province in specific regions. Glen Skaskus, a MOL mining program specialist, said that “although one inspector is assigned per workplace, he may take a trained professional with him” to help with the work. During the October and November mine ventilation blitz, engineers and industrial hygienists accompanied the inspectors. The engineers checked the design of the equipment and the hygienists ensured the ventilation systems were well maintained and that proper ventilation rates were being provided. They audited the ventilation reports and used equipment such as an anemometer, which measures wind speed, to measure airflow, and a multi-gas instrument to measure various levels of gases like carbon dioxide, carbon monoxide, nitrogen dioxide and oxygen. “According to regulations, the mine operator must provide 0.6 cubic metres of air per second for each kilowatt of diesel-powered equipment,” explained Skaskus. Barclay and his team feel the campaigns are working. “The industry is telling us it’s effective, and the feedback from stakeholders is positive – they like that it’s proactive,” he said. CIM

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December 2011 / January 2012 | 29

upfront PROCESSING by Graham Lanktree

Winning electrowinning Barrick’s Zaldivar refinery puts Optibar technology through its paces Wiechmann, Optibar’s general manager and the principal researcher of the experimental technology. “They also impact production, energy consumption and the quality of cathode sheets.

Even current yields higher quality copper

Courtesy of Optibar Inc.

During the electrowinning process used to refine high-grade copper, copper ions dissolved in an electrolyte and charged with a direct electrical current attach to cathode surfaces. Traditional Walker intercell bars, which run the length of the many cathode-anode pairs that make a cell, disperse the electrical current unevenly throughout the refining cell array. This results in significant An Optibar intercell bar installed on one of Compañia Minera Zaldivar's refining cells in northern Chile weight differences between finished cathode sheets and favours the creation of ore than 40,000 tonnes of copper have been short circuits, reducing the copper’s quality and leading to refined in a year-long test run of Optibar Inc.’s frequent replacement of parts. Optibar’s segmented bars new technology at Barrick Gold’s Zaldivar copper force the current to be balanced between all cathode-anode plant in northern Chile. The new segmented pairs throughout the circuit and to use preferred electrical intercell bars being used in the Compañia Minera Zaldivar paths. Because the current is distributed evenly, current denrefinery have slashed energy costs, reduced short circuits sities can be increased and harvest times extended, which during refining and allowed the production of heftier, purer produces larger, higher quality sheets of copper. “The new bars were installed progressively during regular sheets of copper – gains that all promise to boost the plant’s maintenance of the copper refining cells starting in October margins. 2010,” says Wiechmann. The modifications made to one of A copper refining tank house containing the cell circuits four 92-cell circuits in the plant’s refining tank house did not typically consumes 2,000 kWh of electricity to produce a disrupt production, he explains, because Optibar simply single tonne of grade-A copper. Yet, monitoring the energy modified the original Walker intercell bars connecting cathefficiency of the Optibar technology after increasing the odes and anodes. “Not even a single modification to cells, weight of harvested copper sheets, the project’s engineers electrodes, cranes, lifting devices, short circuit frames or recorded a 92 kWh-per-tonne cut in energy consumption, a other equipment was required,” he wrote in a paper describsavings of 4.6 per cent. “Today, with the power prices we have, Optibar technology represents a potential savings for ing the technology. the whole plant of US$1.5 million per year,” says Robert Working at full capacity, the Zaldivar refinery proMayne-Nicholls, executive general manager of Barrick duces 140,000 tonnes of copper cathode sheets each year. Gold’s Chilean operations. To power production, the plant uses 280 GWh of electricThe savings generated by a single circuit weighs in at ity generated by coal power plants at an annual cost of US$375,000 per year. Installing one will cost US$650,000, US$42 million. Mayne-Nicholls says, but that investment is paid back in Testing demonstrated that the optimal harvest cycle for less than three years. There are other savings to be made as Walker bars is 110 hours, with a final cathode sheet weight well, he adds. “We think that Optibar will also extend the of 39 kilograms. With the same current density, Optibar prolife of cathodes, anodes and capping boards.” The technol- duced 42-kilogram cathodes in 116 hours. “Short-circuit ogy promises to do this by reducing metallurgical short cir- occurrences are down one-third and their intensity also to cuits during the refining process. one-third,” says Wiechmann. “Therefore, their overall “High-intensity short circuits cause deterioration of impact on the process is only one-ninth of what it was with anodes, copper contacts and capping boards,” says Eduardo Walker bars.”

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upfront

Courtesy of Optibar Inc.

PROCESSING

Partial view of an electrowinning tankhouse: a) Walker intercell system; b) Optibar intercell system.

New technology is no replacement for routine maintenance Optibar’s technology is not the only way that refineries can achieve better performance. “We started measuring our operational practices during the tests,” says MayneNicholls, who notes improved housekeeping, such as the regular maintenance and cleaning of intercell bars, anodecathode hanger bars, cell structures and electrode contacts, can have a large impact. When these routines were applied to Walker intercell bars, engineers measured a reduction in energy consumption from 1,985 to 1,965 kWh per tonne and saw fewer short circuits occur throughout the cells. Even with these results in hand, Mayne-Nicholls says the Zaldivar plant will postpone installation of Optibar in its remaining circuits. “We have learned that the main savings with Optibar are generated with higher current densities,” he explains. “The original goal was to reach a reduction in power consumption from two to five per cent. At the beginning, we almost reached five per cent but since then, we have consistently applied a two per cent savings.” Next year, the plant will continue to use the same current density. With that in mind, further installation of Optibar will be delayed until the plant’s current density is increased. “Despite this,” Mayne-Nicholls says, “we strongly recommend that all new electrowinning facilities be fitted with Optibar from the beginning.”

system offers uniform distribution of an electrical current, while Optibar’s is much more uneven. And in a 2010 paper, researchers Anthony Blackett and Michael Nicol of Australia’s Murdoch University had success replicating Optibar’s current distribution, but found that during simulated short circuits, the technology passed the short circuit effect to adjacent copper cathodes. Laitinen, Blackett and Nicol’s research had one flaw that prevented them from predicting realistic results, says Wiechmann. “Their mathematical models did not include a compensating bar used to interconnect both ends of the intercell bar,” an element that he says is crucial. Until now, mathematical models were all that Optibar had, but with the positive results from Barrick Gold’s Zaldivar copper works, Wiechmann says that Optibar is close to a deal to test the technology at BHP Billiton’s Spence plant nearby. He believes this is just the beginning, because the technology can also be applied to zinc refineries and, he explains, his team is working to further increase energy efficiency by an additional eight per cent. However, to get the most out of this new technology, Wiechmann says plant designers need to consider its use from the very beginning, “Full advantage of Optibar technology requires more freedom during the design stage of a new project.” CIM

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Refining the science The positive results at Zaldivar contrast with some previous modelling that had been done. Two research papers, which were published before the device was installed in the Zaldivar plant, challenged the work done by Optibar’s Wiechmann and his team at the University of Concepción. In a 2009 paper, Finnish researcher Ilkka Laitinen, of the Tampere University of Technology, found that the Walker

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upfront TECHNOLOGY by Peter Diekmeyer

Vale hauling in a new direction Rail-Veyor transportation system to be tested at Copper Cliff demonstration plant Courtesy of Vale

interconnected two-wheel cars that run on light rail tracks. The system is powered by several stationary, variable-frequency drive stations that are positioned at intervals along the track. Sensors identify the cars as they approach the drive stations, which then power up horizontal tires that turn against drive plates that run along the sides. To save energy, the drive station shuts down as the last cart passes through. Individual carts are connected in a way that allows them to navigate curves and to dump cargo when their destination is reached. Gaps between the carts are sealed with flexible flaps, which prevent leakage as well as form a chute to ease product discharges. The Rail-Veyor hauling system can turn tight corners, climb steep grades, and even operate fully inverted. The system’s track and drive systems were designed so that the cars can be ale is pouring $3.4 billion worth of investments into its operated regardless of whether they are inverted or upright. Sudbury operations, and Alex Henderson, Vale’s That means that the cars can be unloaded by travelling Atlantic region general manager of mines and mill around a “roller-coaster” type loop over the final dumping technology, is expecting big changes. “Imagine a mine area where they are emptied as they move into an upsidewith no shaft or head frame, no loading pockets, no under- down position. Rail-Veyor’s technology combines the benefits of rail and ground crushers, no conveyors and no diesel haulage trucks,” conveyor haulage systems: it currently runs at speeds of up he says. “New technology is making a lot of this possible.” to six metres per second and can complete complex turns in One of those technologies is a hybrid light-rail/conveyor a tight 30-metre radius. Most importantly, for the current hauling system created by Rail-Veyor Technologies, which Vale will be testing in its Copper Cliff Mine 114 Orebody Vale testing facility, which will be Rail-Veyor’s first underDemonstration Plant. The company is investing $49 million ground installation outside of Africa, carts can ascend or in the system, which will include 760 metres of track, a sur- descend track at a 20 per cent angle, which keeps down the face dump loop and a control room. Installation is expected length required. to be completed and testing started by the first quarter of The Rail-Veyor system is powered by electricity, which is 2012. Once installed, the system is anticipated to help especially important in underground mining operations develop the mine at a fairly aggressive 12-metre-per-week where diesel engine emissions put higher demands on the pace, due in part to the fact that the Rail-Veyor system ventilation system. “The Rail-Veyor technology is part of a requires smaller development headings. series of initiatives at the demonstration plant that could “It’s a safe, lean, green, mining machine,” says Henderson, reduce energy requirements by at least 50 per cent per tonne with a chuckle. One of the system’s early boosters, Hender- of ore over current practices,” says Henderson. son was introduced to Rail-Veyor by the company’s business development staff, who had come to visit him at his office. Home-grown success He was immediately impressed with the technology and soon Mike Romaniuk, Rail-Veyor’s president and CEO, and a jumped on a plane to South Africa to check out a similar sys- group of Sudbury-based partners bought the technology tem that was already operating there. from its initial developers in 2010, improved it, and sought out a test client. They did not have far to look, because Vale An imaginative approach sites are located just a short distance from Rail-Veyor’s head The Rail-Veyor system combines the benefits of several office. “I tried retirement for about four weeks but found major competitive technologies. It consists of a series of that is was not for me,” says the past vice-president of

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Xstrata Nickel’s Sudbury operations. “I’d much rather be active, and starting a new business is a good way to do that.” But Romaniuk is doing much more than just keep active: he has set an ambitious agenda for the company. If all goes well, he hopes they can use the site to showcase the technology to other clients around the world. Because the RailVeyor is scalable and can economically move materials over distances ranging from a few hundred metres to hundreds of kilometres, the range of potential clients is vast, particularly among surface mining facilities. “It’s a major opportunity,” says Romaniuk. “Although the Vale installation is underground, 16 billion tonnes of the world’s mineable reserves are in surface sites, compared to just 850 million tonnes underground.” If demand for his products increases, Romaniuk is sure that supply issues will not be a problem. Track for the system is widely available commercially, and two key components, the cars and drive stations, are manufactured in Sudbury by Bristol Machine and B&D Manufacturing. Despite the Rail-Veyor system’s early promise, Henderson is not jumping the gun on any major extension of the technology. Once the initial installation gets up and running and the bugs are worked out, prefeasibility studies will be conducted to assess the degree to which similar solutions can be applied at other Vale sites. CIM

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Very big. From the world’s largest haul road arch GIVING BACK Pierre Lassonde has a history of making multimillion-dollar gifts, but he recently gave what will easily be his largest: a $25-million donation to York University. Lassonde hopes to help groom a generation of “renaissance engineers” and push York to a position where it may become a leader in interdisciplinary learning and industry partnerships.

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York has wanted a full-scale engineering school since 1963, yet still has only about 300 students in specialized programs such as geomatics engineering. Now it is spending $100 million, including Lassonde’s money and $50 million from the province, on a new faculty and building that is expected to hold 2,000 students by 2020. “Canada’s natural resource is not our oil, it’s not our minerals, it’s not our forests; it’s our young people,” Lassonde said. “If you try to compete against China on wages, you’re going to be a poor country. You’ve got to compete on brains.”

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December 2011 / January 2012 | 33

upfront NEW FRONTIERS by Alexandra Lopez-Pacheco

Gas stations in space Shackleton Energy plans to convert the Moon’s water supply to rocket fuel

Courtesy of SEC

using power from the sun beamed from the crater rims. “We’ll take the water, load it into transport vehicles and fly it to low Earth orbit (LEO), where the water will be loaded onto a fuel processing facility, turned into gaseous hydrogen and oxygen, and then into liquid hydrogen and oxygen,” says Tietz. “These rocket propellants then will be stored in very large cryogenic containers to fuel customers’ space vehicles. The beauty of this process is that it’s ultra clean, with no pollutants, involving minimal processing complexity. After water extraction, we’ll return the leftover rock debris to the craters, so there’s virtually no environmental impact to the crater as a result of the mining.”

Shackleton Energy proposes to mine water on the moon, convert it to rocket fuel, and sell it to spacecraft in low Earth orbit.

t first, the idea of mining lunar ice to manufacture rocket propellant seems a bit out of this world. It is as improbable, perhaps, as walking on the Moon might have seemed to the average person a decade before Neil Armstrong did so with the Apollo 11 mission in 1969. From the perspective of Shackleton Energy Company (SEC), the Texas-based company that plans to begin mining lunar ice by 2020, the only real impediment to launching its lunar mining operations is finding enough forward-thinking investors to make it possible. The company argues that lunar explorations by international space programs, including NASA’s 2009 LRO/LCROSS probes, have confirmed there is water ice in the Moon’s craters – and plenty of it. “From a physics standpoint, everything is in place for us to do the mission,” says Dale Tietz, SEC’s president and CEO. “The technology for turning water into rocket propellant has been around for decades, although we have to space qualify this technology so that it will operate in orbit and on the Moon’s surface, especially in very hostile, dark, cold conditions. But that’s all a relatively straightforward engineering challenge.” While the specifics of how the water will be mined will depend on the findings of SEC’s manned and unmanned exploration activities on the Moon, the most likely scenario will be that automated equipment will strip mine the iceladen top layer of dirt and rocks in the lunar craters. The water will then be extracted by heating the crushed rock

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Earth’s rising fuel costs affect space as well

The company has a profitable business model, says Tietz, because it is built on a solution to a common problem. One of space travel’s greatest challenges has always been its astronomical cost, much of which is due to the Earth’s gravity and punishing atmosphere. To escape our planet’s pull, rockets use a tremendous amount of expensive propellants and tankage. SEC’s models indicate that their business will not only open up space travel by making it dramatically more affordable, but also eventually provide investors with a significant return on investment. “One litre of water in orbit is worth something in the order of $10,000,” says Greg Baiden, a professor of engineering at Laurentian University and CEO of Penguin Automated Systems, which will work with SEC to develop the automated equipment to mine the lunar water. “To understand the cost of getting from Earth to orbit, think of the size of the NASA Saturn V rockets compared to what the astronauts returned to Earth in.” In contrast to launching from the Earth, it takes very little fuel to lift off the Moon. With SEC service stations in LEO, rockets leaving this planet would only need enough fuel to reach the stations, where they would “gas up” for the rest of their journey. “With our concept, there is at least a 20 to one potential cost savings of propellant mined from lunar ice and sold in LEO compared to launching a rocket with propellant from Earth,” says Tietz. “We won’t sell it at 20 to one, but it shows you how much profitability is possible, especially if

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international demand for the fuels grows exponentially. Our concept is to become the major enabler of growing the new space economy in ways we can hardly imagine,” he adds. Such a dramatic cut to fuel costs, says Baiden, will open up opportunities not just for scientific space exploration, but also for ventures by other mining companies and industries. Scientists believe the Moon is rich with resources, including platinum group metals, mercury, gold, silver and Helium-3, which is rare on Earth, but is essential for yet-tobe-developed nuclear fusion reactors. “There’s also the potential for solar power stations being built on the Moon,” says Baiden. “The future of our terrestrial energy systems on Earth may well depend on the Moon.”

Industry needs to get things moving “In Columbus’ day, the government – the Queen of Spain – built the sailing ships to explore the New World,” says Baiden. “But once the Queen had financed the first exploration missions, an explosion of commerce followed, which provided a great ROI.” Development in space, Baiden believes, will need to go through the same process. “NASA built ships, too; but in this case, the mining industry could be the one that plays the pivotal role in financing space exploration, and it’s a role the industry has played all along in human exploration,” he adds. And it is a role not many others are rushing to fill. “We don’t believe there are any competitors right now on the scale we’re suggesting,” says Tietz. “Most companies looking at mining on the Moon depend on collaboration with government organizations like NASA. They talk about mining, but right now it’s all on a very small scale. We made a decision years ago that the only way to do business is privately, as an industrial venture, not sponsored or funded by government. Instead, it will be sponsored by very wealthy individuals or syndications. We think we can accomplish our goals and be open for business for about $25 billion.” And they think they can do it by 2020, depending on whether or not they raise initial funds for their program within the next year. “If you don’t set a target date, then you’re like everyone else and you study things to death and never produce a product,” says Tietz. Baiden says alternative investors may offer more than traditional banks would for projects like SEC’s. “I’m not sure how enamored institutional investors would be with this, but I’ve seen institutional investors not get excited about good mining projects as well,” he says. For now, SEC is looking to billionaires and pioneers, as well as companies in the energy and mining sectors, which are more familiar with a culture of long-term investments. “It’s like a giant flywheel: a whole lot of people have to put their shoulders in just to get it to turn a fraction of an inch, but after a while, when enough people get in, it starts to move,” explains Baiden. “Eventually, it takes on a life of its own. If I can get that flywheel moving, then I’m pretty interested in that.” CIM

If Shackleton Energy Company is successful in establishing its water mine on the Moon, it will not need a mining permit, nor will it own any land. That is because all lunar mining operations fall under The Outer Space Treaty of 1967, which provides the basic framework for international space law. But that’s all it is, a very basic framework. One of the principles of the treaty is that the exploration and use of outer space, including the Moon, must be carried out for the benefit and in the interests of all countries and mankind. “How you do that has never been tested before or defined to a very specific degree, which is actually very good for a commercial enterprise such as ours,” says Tietz. “It will all have to be worked out in the future, but we are convinced, along with others, including space law experts on our team we’ve been working with for years, that there’s nothing that prohibits us from going forward and launching from the Earth to the Moon and beginning operations. The path forward is very clear and industry must lead the way responsibly. This is possibly the world’s next major mining and energy play off Earth.” As exploration and development on the Moon begins and grows, however, most, including Tietz, expect the world will return to the table to begin negotiating more detailed guidelines and laws to support subsequent scaling of the space-based economy.

December 2011 / January 2012 | 35

upfront ENGINEERING EXCHANGE by Peter Diekmeyer

The return of roasting? Difficult gold ores are enticing operators to take another look at this technology

Bernd Reeb

about unstable arsenic-containing effluent generated by roasting at the Giant Mine in Yellowknife, which started operations in 1948, contributed to an abandonment of the process in North America. The problems were very real: at the beginning of the 1950s, emissions of arsenic trioxide dust at the Giant Mine were as high as 7,400 kilograms per day. But today’s roasters are not much like their old, badly polluting predecessors. Fluidized bed technology, which has been evolving for decades, uses hightemperature gas jets to heat ground ore. Under the right conditions, the ore begins to act as a liquid, making the process more efficient than when simply heating one layer. The classical fluidized bed technology is called “bubbling,” since the top of the ore layer can be seen to bubble like it is boiling inside the reactor. Newer, circulating fluidized bed roasters, on the other hand, have gas entering the reactor at such a velocity that particles are picked up and brought to the top of the reactor. Then, the particles are separated with a cyclone and returned to the mix, creating a very controllable, homogenous temperature. But even though fluidized bed technology has continually improved, the demand for it has dropped off. “During the 1950s and 1960s, Outotec installed about five metallurgical fluidized bed roasting plants each year,” says Marcus Runkel, a senior process engineer at the company. “This doubled to ten per year during the 1970s and 1980s before falling off to about two per year in the 1990s, and then to just one plant a year now.” Runkel feels that demand for fluidized bed roasting installations could be poised for a comeback in North America. While the number of plants being built has decreased, plant sizes and throughput have increased. “The average plant capacity from the early years increased by a factor of about 15 to plant sizes today,” he says. According to Barnes, “newer technologies, such as second-stage after-burners and oxidizers, are available to address environmental concerns.” He says that “as a result, much of the current reluctance to use roasting in North America is probably due to institutional inertia.” Runkel agrees. “Environmental standards around the world have been increasing,” he says. “It is almost mandatory

Hindustan Zinc Ltd.’s 170,000 TPA zinc roaster in Chanderiya, India

iners who need to process refractory ores should be giving roasting a second chance, according to some at the forefront of the technology. During the last few decades, North American mining companies have shied away from the process, which involves heating refractory ores to release the valuables inside. Roasting lost much of its lustre following implementation of tougher emissions standards, but with new technology available to curtail environmental problems and the move towards increasingly low-grade refractory ores, a resurgence is now possible. “The new ore bodies that companies are looking to bring on stream in coming years will require considerably more effort to make them profitable,” explains Arthur Barnes, principal extractive metallurgy consultant at Xstrata Process Support (XPS). The main contributors to refractoriness are sulphides and carbons, and with increasing need to remove these from the ores, Barnes believes that in many cases, roasting can be cheaper and easier to implement than alternative techniques.

Myths and realities The concept of roasting is relatively simple. At high temperatures, gases react with the ore and carry away unwanted elements, leaving a more refined material behind for further processing. At the turn of the 20th century, the heating process was conducted out in the open, which, as one might imagine, led to substantial emissions. Additionally, concerns 36 | CIM Magazine | Vol. 6, No. 8

upfront ENGINEERING EXCHANGE

to always use the best technology that is available. Heat recovery and gas cleaning are integral parts of a roasting plant. Heat recovery, specifically, gives roasting an advantage over the hydrometallurgical processes,” he explains. “Technical solutions for roasting are available to meet all environmental regulations.”

Old habits die hard Right now, most North American mine operators rely on pressure oxidation processes to treat ores that contain pyrite, arsenopyrite and carbonaceous material for domestic operations. However, pressure oxidation, which requires autoclaves, necessitates major capital investments in equipment and operating costs to get running, as well as lengthy permitting processes. “There is no easy way to treat these complex or low-grade ores,” says Runkel, so many operators are considering alternative procedures like fluidized bed roasting, which, while also expensive and time-consuming, have the potential to be very efficient. XPS operates three fluid-bed reactors that it uses to test whether roasting can be used to treat highly refractory ore samples. While their facilities are near Sudbury, their clients are primarily companies that want to conduct preliminary mineralogical modelling outside of North America. XPS looks at both the physical and chemical aspects of the roasting process from samples drawn from ore bodies in places where roasting is more widespread, says Barnes. The facility operates under conditions of strict confidentiality, so Barnes cannot disclose specifics, other than to say that a large variety of samples have been tested and that the process has been “encouraging.” The flexible range of reactor units at XPS, which can operate in a variety of modes (such as “bubbling bed,” circulating bed, two-stage, sub-stoichiometric and combinations of these) gives XPS the ability to accommodate a variety of sample sizes ranging from a few kilograms to a few tonnes. “The facilities are busy,” Barnes says. Running small-scale roasting tests can be challenging. Assembling the 10 kilograms of concentrate to use as test material is difficult because the samples available from mine sites prior to commercial drilling are generally just drill cores. To process 10 kilograms of concentrate for testing purposes could require close to a tonne of core material, says Barnes. Once the testing is completed, he generally recommends that the mine developer start talking with a commercial roasting facility developer.

Research can help overcome hurdles Barnes admits that there are considerable challenges in getting roasting technology accepted again. For example, feeds are far finer these days than they were decades ago, as mineral processing operations seek to maximize gold recovery from supply batches. When processing finer feeds, operators need to take more care to limit the maximum velocity of the fluidizing gases. For example, if the velocity is too high, it is difficult to maintain a stable bed,

with a distinct “fluid” boundary, and the bed becomes much more diffuse. Ensuring correct operating conditions is particularly important when processing highly refractory gold ores, and especially ones containing arsenic. As a result, Barnes notes that “all roasting predictions and calculations need to be confirmed or modified by carefully controlled and monitored testing” at facilities such as XPS’s and Outotec’s. CIM

MOVING ON UP Erdene Resource Development Corp. appointed Michael MacDonald to its management team as director of exploration – Mongolia. He will be responsible for the design and implementation of Mongolia programs dealing with exploration, development and management, including working with various government agencies in Mongolia as they relate to Erdene’s land holdings and future interests. *** Greg Dawson joined Colorado Resources Ltd. as the company’s vice-president of exploration. Dawson, who has over 25 years of experience in the exploration sector, was most recently the president of Redtail Metals Corp. *** With the creation of two business units – Manitoba and South America – HudBay Minerals announced the appointments of Brad Lantz as vice-president, Manitoba Business Unit; Cashel Meagher as vice-president, South America Business Unit; Hernan Soza as vice-president exploration; Victor Loayza as president, HudBay Peru; and Terry Linde as director of projects, HudBay Peru. *** North Atlantic Potash appointed David Waugh as its CEO. Waugh will lead the company’s ongoing exploration and development of its 2.7 million acres of permitted land in Saskatchewan’s potash belt. He has over 30 years of progressively senior experience in the potash sector in exploration, development, and mine construction and operations. *** Diamond Discoveries International Corp., a U.S company focusing on chromium, platinum group elements and gold exploration on its 100 per cent-owned Caribou property in Thetford Mines, Quebec, appointed Christopher Ecclestone as vice-president of business development. Ecclestone is a principal and mining strategist at Hallgarten & Company in New York and the CEO/director of Mediterranean Resources.

December 2011 / January 2012 | 37

upfront Q&A by Peter Braul

A global community organizer Jean Vavrek leads CIM into a new era of opportunity, at home and abroad CIM: What is the biggest surprise that you have encountered in your travels? Vavrek: I’d say my business in Africa, where I have been testing the waters over the last 12 months or so. Many people have been saying, “Africa is just not there. They’re 15 or 20 or more years down the road from being a market worth considering.” Those people are just lumping all 50 or so countries in that continent into one. There are plenty of people there that are smart, passionate and that care about their people. They want to see change. I think we shouldn’t underestimate how fast Africa can develop and what kind of opportunities it can provide. That, to me, has been the biggest revelation.

fter eight years as CIM’s executive director, Jean Vavrek has touched down in board rooms, conference centres and halls of power around the world. Whether he is meeting government officials or cultivating relationships with CIM’s sister organizations in this and other countries, Vavrek is the face of CIM and an enduring presence on the leading edge of the global mining industry. Recently returned from a trip to West Africa, Vavrek sat down with CIM Magazine to talk about the big moments of the last year and his vision for CIM’s future.

CIM: You’ve met with legions of people over the last 12 months. Was there a discussion you had that stands out as CIM: What is your goal in meeting our especially memorable? sister associations around the world? How Vavrek: What comes to mind is my does this bring value to CIM? We could easily reach meeting with the president of the Vavrek: Our first goal is to help dissemiand mobilize from Republic of Senegal in late October. It nate and develop knowledge. All of these was very open and somewhat freeorganizations have information and pracfour to 10 million of the wheeling. The comments he made tices that we may not be aware of. Recipworld’s top scientests about Africa not quite being ready for rocally, we can share with them some of and engineers. democracy as we know it were very the amazing work we have been doing in candid. He recognizes they have the areas of resources and reserves definimajor gaps in terms of how they take tions, safety and corporate social responcharge of their own business. I see a parallel here in Quebec. sibility. Currently, we probably learn the most from the Thirty to 40 years ago, Quebecers recognized they had to Australians because we’ve developed the strongest relationtake charge of their own destiny – and they have. Now, after ship with them, but I think we’ll be accessing more infora lot of hard work, they have built amazing companies that mation from our American counterparts because we are are global in scope. The Senegalese are in a similar situation; looking to engage more closely with them as well. There is they’ve got to step up and match the entrepreneurship and a whole world out there that needs access to what we do – business models presently deployed by the Europeans and collectively. some of the people from the Middle East. We are all struggling with how to develop a global institute; the world needs it. Our industries are global – our CIM: What are potential members in developing countries suppliers as well as our operators – and I think Canada has asking for from CIM? a leadership role to play. We want to be one of the powerVavrek: They see how we run our industry and how our peo- houses of development. There’s always going to be compeple perform; they aspire to something similar but they don’t tition but, really, we should all be part of the tide that raises know what steps to take to get where we are. Developing all boats. countries are looking to establish a kind of road map for the next 10 to 15 years. CIM is one of few organizations with the CIM: The global industry is a competitive field. Is there mechanisms that can help develop that knowledge, and anything about the “Canadian” brand that needs to improve if that’s starting to happen through our work with the Centre CIM is to be a strong and relevant international organization? for Excellence in CSR and the Canada Mining Innovation Vavrek: In terms of innovation, Canada is seriously lagging. Council (CMIC). That’s not just in our sector – we really need to get our act

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

together. There are too many internal scuffles between provinces and institutions, and unlike countries where more resources are invested in the development of export markets and commercialization, Canada’s brand hasn’t been present out there. People have taken a lot of notice of the innovations coming from Australia and Brazil, but less so from Canada. We’re just not pushing the envelope enough. CIM: By choosing Vancouver and Montreal as the alternating host cities for the annual conference and exhibition, CIM will be able to streamline the event planning process and save an estimated $1 million over the next decade. This, of course, has left other cities out. How is CIM going to serve these other locations? Vavrek: We’ll do a number of things. The event is going to become more geographically diverse in scope. CIM Council has mandated the creation of an international advisory committee for the annual conference, so we’ll make sure that it appeals to a wide audience. We’ve also already identified other events that are well-suited for some of the Canadian cities that are not hosting the annual conference. For example, the Maintenance Engineering/Mine Operators’ Conference is an ideal fit for Edmonton. Through a partnership with AusIMM, we’ve also succeeded in bringing the International Mine Management Conference to Canada for the first time in 2014, which Toronto will host. CIM: What is the most significant change you are expecting in your work for 2012? Vavrek: CIM has been growing incredibly fast – we’ve doubled our staff at the national office over the last two years – but we always seem to be playing catch-up with the opportunities. They’re right at our fingertips, but we haven’t been able to mobilize quite fast enough to take advantage. I’m aiming to get to a stage where we’ve got more time to put ideas into motion. I personally aim to be making real, hard contacts with key people on the ground so that we can see concrete results from all the work we’ve done. CIM: Professionally speaking, who would be your “dream date” to spend a day with in 2012? Vavrek: It would probably be Bill Gates. That guy has put aside his corporation to help run his foundation; he’s looking to help change the world. I think he could do things for us, and we could do things for him – especially with our connection to the Council of Engineering and Scientific Society Executives (CESSE). Collectively, we could easily reach and mobilize from four to 10 million of the world’s top scientists and engineers. We’re having those discussions about what our role is in society. We have an obligation because we are in the best position to do something. If we don’t, who’s going to step up? CIM: What about a place – where would you like to go? Vavrek: Even though my travels have taken me around the globe, I’d really like to see and experience a place like Attawapiskat in northern Ontario. I engage more and more with our First Nations, but I can’t really speak from experience when it comes to their communities. I have the sense that we all have to get our boots on the ground and engage with the people who have such an enormous stake in future mining development in this country. CIM

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outlook 2012 Developing new markets

everything else is getting bigger and creEconomist Pedro Antunes, from the ating a critical mass. This is generating Conference Board of Canada, says a strong demand for products that will conboost in prices for resources in general tinue to boost raw material prices and contributed to a turnaround in 2010increase profits for the mining industry.” 2011. “Increased commodity prices have Antunes cautions, however, that a helped generate income in Canada that financial meltdown in Europe could cause has trickled down to all levels,” he says. serious damage to this rosy outlook. “The “The terms of trade over the past decade risks are real for another crisis with dire have steadily improved because we’re short-term impacts on commodity prices getting paid more for what we’ve always and the U.S. economy, which in turn would produced.” affect hiring and investment in Canada,” As director of the Conference he explains. Resource Board’s National and Provincial ForeAccording to Antunes, private-sector nationalism is cast, Antunes believes commodity prices forecasters agree the EU will be able to will continue to rise above inflation and backstop the problems to avoid a financial a media term maintain Canada’s terms of trade and crisis. Nevertheless, prospects for ecothat gets everyone nomic growth in Europe and the United income. He anticipates the 2011 raw material price index will show an overall States are now reduced by about half. into a tizzy. increase of 12 to 15 per cent, but this “Contributions to world economic growth ~ D. Horswill will vary for individual sectors. by the developing world and the develChina, along with India, will contribute oped world are now running around significantly to world economic growth in 2012, predicts 50/50,” he estimates. Canada has opportunities to expand Antunes. “In 2000, they were five per cent of the global and diversify markets in the emerging economies, but we economy, and this doubled to 10 per cent by 2010,” he need to be more aggressive in our trade, especially with notes. “The growth and size of those economies relative to Asia.

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The revenue and regulation dance

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

Kevin Loughrey, CEO of molybdenum miner Thompson Creek Metals Company, is not so sure about China. He’s disappointed with the 2011 economy and says his company, which produces molybdenum at operations in British Columbia and Idaho, did not meet its potential. Loughrey says sales of Thompson Creek’s primary commodity were affected by uncertainty in some quarters about China’s ability to maintain its recent economic growth. This uncertainty was also fuelled by concerns about the possible domino effects of problems in the Eurozone. “Molybdenum trades on the sentiment of the day,” Loughrey adds, “and uncertainty provides negative sentiment in the market. No long-term view is built into molybdenum’s pricing mechanism. A lot of our customers who are not doing too badly are still unwilling to commit beyond today’s needs because they lack the confidence in the future that they would have in other times.” Loughrey says Thompson Creek Metals will not spend as much in 2012 on exploration, development or acquisition as it would in a “normal” year. Nevertheless, he believes metal prices are on a “good path” and the com-

outlook 2012

targeting the mining industry? Because that’s one “Why are ofgovernments the few places in the world where there’s money. ” ~ G. Ives

pany is following through on its significant commitment to a mill expansion project at its Endako operation and the Mt. Milligan copper and gold development, both in BC. However, the challenge for next year and beyond is one Loughrey has in common with many other Canadian mining companies – regulatory hurdles. “They all cost money and add time and complication to our efforts,” he says. Loughrey stresses that the mining industry acknowledges the necessity of environmental controls, community protection, disclosure and compliance regulations. He argues, however, that government bureaucracies are not particularly good at cost-benefit analysis. “Every hour of every day sees tension in government between regulatory control and the desire to raise revenue, create jobs, increase exports and national development,” he says. “But at what point does the cost go beyond the bounds of reason?”

is extra-territorial in its reach. “It applies not only if a company has performed illegal acts,” he explains, “but also if the organization is associated with a person or supplier who has broken the law.” According to Lachcik, another regulatory trend towards corporate social responsibility was the recent ISO 26000 initiative. “It was the first attempt at a common framework to regulate various areas covering the environment, safety, human rights and fair dealings,” he says. Elsewhere in 2011, the UN Human Rights Council endorsed the so-called Ruggie Principles on fair grievance procedures. The principles were adopted less than a year after U.S. President Barack Obama signed into law The Dodd–Frank Wall Street Reform and Consumer Protection

Enduring scrutiny International corporate lawyer Richard Lachcik, from Macleod Dixon, says miners and other companies that want to prosper in 2012 will need to adapt to tighter regulations around the world. “Corporate social responsibility and anticorruption legislation are now on everyone’s mind,” he says. “And 2011 was a watershed year. That’s when the UK anti-bribery legislation came into effect and forced companies to take the issue more seriously.” Lachcik says the legislation indicates governments’ stricter attitudes towards bribery because the act not only increases penalties but December 2011 / January 2012 | 43

outlook 2012 Act. Passed in response to the country’s recession, the Act has been described as the most sweeping change to financial regulation in the United States since the Great Depression. Lachcik says it all means that practicing transparency and diligence, and having policies and procedures in place in conducting audit reviews to ensure compliance with the new policies will be critical. “Those that do,” he argues, “will find themselves able to access capital better than those that don’t, because investors and other stakeholders are going to be asking questions.” Lachcik dismisses fears about this scrutiny. “I don’t think it will decrease the level of investment,” he says. “I think it will steer it towards the companies that are taking all of this seriously.”

Powerful forces at work Glenn Ives of Deloitte Canada endorses the idea that mining companies will need to work harder in 2012 to manage their reputations. As chairman of a professional services firm, he finds that that mining companies are now in the news every day and believes this greater visibility requires greater engagement. “People from outside the industry often assume that stories from 30 or 40 years ago represent what’s happening today,” says Ives. The industry needs to develop a new frame of reference. He cites the example of the wind

farm Barrick recently inaugurated in Chile as a story that ought to be told. Beyond the public relations front, Ives predicts that the skills shortage is another challenge mining companies will face in 2012 as more experienced workers retire. “A lot of people who entered mining in the 1960s and 1970s are coming to the end of their careers,” he says. “At the same time, young people are often not interested in going to a remote mine site.” According to Ives, more technology investment is needed in workforce planning. He points to Rio Tinto’s automation efforts in Western Australia as a good model. “Companies also need to hire people that they can move around to all their mines rather than just basing them in the one place,” he says. “Such movement reduces numbers while making the job more interesting.” “These days, it’s important to build a culture that encourages people to stay in your organization,” Ives adds. “Another solution to the loss of talent is to build skilled regional labour forces from the ground up.” Resource nationalism is another global trend Ives underscores. As emerging economies around the world continue their rapid industrialization, demand for commodities is skyrocketing. At the same time, various countries are curbing the export of natural resources, shutting down some traditional supply markets, or demanding the repatriation of profits. A Deloitte report says this trend is affecting commodity prices and changing the way mining companies do business. “Why are governments targeting the mining industry? Because that’s one of the few places in the world where there’s money,” says Ives. He says companies will have to cope with the struggle for export dollars by countries in South America, Africa and elsewhere. “You can’t move resources; you have to work with local government,” he says. “My hope is that these governments realize their approach means that the more marginal and difficult deposits will not be developed, and these are the real loss to a developing country.”

A world of opportunity Doug Horswill, senior vice-president, sustainability and external affairs at Teck Resources, is less concerned about resource nationalism. “It is a 44 | CIM Magazine | Vol. 6, No. 8

outlook 2012 Every hour of every day sees tension in government “ between regulatory control and the desire to raise revenue, create jobs, increase exports and national development. ” ~ K. Loughrey

media term that gets everyone into a tizzy,” he says. “There are very few cases of countries taking away rights that they granted to companies, at least not without compensation.” As the value of resources rises, Horswill argues that citizens in developing countries are justified to expect an increased share of the return from those resources. “The fact that taxes change looking forward is a legitimate public interest as long as operations that are already in place retain the rules that existed when the original investment was made,” he says. “We’ve seen governments talk about increased taxes but then respect the original agreements, because they realize that to do otherwise would impair their ability to attract foreign investment in the future.” Teck’s diversified interests include copper, metallurgical coal, zinc and energy in Canada and South America. Despite market volatility in 2011, Horswill says the company fared well. “Our buyers continued to buy and our prices have continued to stay strong,” he says. “Coal prices peaked in the first quarter and copper is still strong, despite the economic slowdown. Teck saw record revenue and profits in the third quarter and now has over $4.5 billion in the bank.” Teck has a portfolio of projects ahead of it in Canada that could well exceed $10 billion or more for the company over the next 10 years. And recent compilations by the Mining Association of Canada list some $130

billion dollars of investment projects over that same period. There is a very bright future ahead for the Canadian resource sector, driven in large part by the growth of demand in China and India. Clearly, Asia will be the economic powerhouse for the coming decade or more. The biggest potential downside risk ahead could be the challenges China faces in managing its environmental issues. If it fails to take effective measures to reduce pollution, it could face serious social repercussions. The Chinese government seems to realize this and the country is taking steps in the right direction. Here, Horswill sees a big opportunity for Canadian companies. “Any entity contributing to China solving its environmental problems will be well-positioned.” CIM

December 2011 / January 2012 | 45

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Perspectives 2012 Afin d’évaluer les défis qui devront être relevés au cours de la prochaine année, les rédacteurs de CIM Magazine sont allés interviewer de nombreux spécialistes. Ces points de vue variés provenant de producteurs de taille intermédiaire et de premier plan, ainsi que de spécialistes du droit et de l’économie, révèlent certains des principaux enjeux pour 2012 (risques macroéconomiques, changements réglementaires, pressions sociales) qui contribuent à définir les perspectives pour l’année prochaine et les années suivantes.

De nouveaux marchés en développement

edro Antunes, directeur des prévisions nationales et provinciales du Conference Board du Canada, croit que les prix des produits de base continueront d’augmenter plus vite que l’inflation, ce qui permettra au Canada de maintenir ses termes de l’échange et ses revenus. Il prévoit que l’indice des prix des matières premières affichera une progression globale de 12 à 15 pour cent pour 2011, mais l’augmentation réelle variera d’un secteur à l’autre. La Chine et l’Inde joueront un rôle considérable dans la croissance économique mondiale en 2012, prédit M. Antunes. « En 2000, ces deux pays représentaient 5 pour cent de l’économie mondiale et, en 2010, cette proportion avait doublé et atteignait 10 pour cent. La croissance et l’importance de ces économies par rapport à toutes les autres ne cessent de s’accélérer, ce qui crée une masse critique. Il en découle une forte demande en produits qui continuera de stimuler les prix des matières premières et de faire augmenter les profits pour l’industrie minière. » M. Antunes nous met cependant en garde contre la possibilité d’une grave crise financière en Europe, laquelle viendrait assombrir beaucoup ces perspectives optimistes. « Les risques d’une autre crise sont réels, et celle-ci aurait à court terme des conséquences désastreuses sur les prix des produits de base et sur l’économie des ÉtatsUnis, ce qui se répercuterait sur les activités d’embauche et d’investissement au Canada. » Selon M. Antunes, les prévisionnistes du secteur privé s’entendent pour dire que l’UE réussira à résoudre ses problèmes et à éviter une crise financière. Néanmoins, les perspectives de croissance économique pour l’Europe et les États-Unis sont désormais réduites de moitié environ. « Actuellement, les pays en développement et les pays développés contribuent presque à parts égales à la crois-

sance économique mondiale », estime M. Antunes. Diverses possibilités d’expansion et de diversification des marchés s’offrent au Canada dans les économies émergentes, mais nous devons faire preuve de plus de dynamisme dans nos échanges, particulièrement en Asie.

La valse des revenus et de la réglementation Kevin Loughrey, chef de la direction du producteur de molybdène Thompson Creek Metals Company, a déclaré que les ventes du produit primaire de sa société ont subi les contrecoups de l’incertitude qui a duré pendant quelques trimestres au sujet de la capacité de la Chine à maintenir sa croissance économique au rythme observé dernièrement. Cette incertitude a également été alimentée par les craintes concernant un éventuel effet d’entraînement des problèmes rencontrés dans la zone euro. « Le molybdène se négocie en fonction de l’état d’esprit actuel des marchés, et l’incertitude les rend pessimistes », explique-t-il. « Les mécanismes de fixation des prix du molybdène ne tiennent pas compte des perspectives à long terme. » « Beaucoup de nos clients dont les affaires vont assez bien sont encore réticents à s’engager autrement qu’en fonction de leurs besoins actuels parce qu’ils ne sont pas aussi confiants dans l’avenir qu’ils auraient pu l’être à une autre époque. » Selon M. Loughrey, Thompson Creek Metals ne dépensera pas autant d’argent dans des projets d’exploration, de mise en valeur et d’acquisition en 2012 qu’elle ne l’aurait fait au cours d’une année « normale ». Il croit cependant que les prix des métaux suivent une « bonne tendance », et son entreprise va de l’avant avec son important engagement concernant le projet d’agrandissement de ses installations de concentration d’Endako et la mise en valeur des gisements de cuivre et d’or de Mt. Milligan, deux sites situés en Colombie-Britannique. December 2011 / January 2012 | 47

perspectives 2012 Une surveillance qui n’est pas près de disparaître Selon l’avocat spécialisé en droit international des sociétés, Richard Lachcik du cabinet Macleod Dixon, les sociétés minières et les autres entreprises qui souhaitent prospérer en 2012 devront s’adapter à une réglementation plus stricte dans le monde. « Tout le monde ne parle plus que de responsabilité sociale des entreprises et de lois anticorruption », affirme-t-il. « L’année 2011 a représenté un tournant à cet égard, le RoyaumeUni ayant mis en vigueur une loi anticorruption qui a obligé les entreprises à accorder plus d’importance à cet enjeu. » Ailleurs en 2011, le Conseil des droits de l’homme des Nations Unies a apporté son soutien aux principes de Ruggie en matière de procédures équitables pour le règlement des griefs. Ces principes ont été adoptés moins d’un an après que le président des États-Unis, Barack Obama, a promulgué la loi Dodd-Frank de réforme de Wall Street et de protection du consommateur (Dodd-Frank Wall Street Reform and Consumer Protection Act). Adoptée à la suite de la récession dans laquelle le pays a été plongé, cette loi a été décrite comme le changement le plus fondamental en matière de réglementation du secteur financier aux États-Unis depuis la grande dépression. Selon M. Lachcik, l’adoption de cette loi conférera une importance capitale à la transparence et à la diligence des pratiques ainsi qu’à la mise en place de politiques et de procédures qui permettent d’effectuer des évaluations et des vérifications de la conformité aux nouvelles politiques.

Des forces puissantes à l’œuvre Glenn Ives, de Deloitte Canada, fait sienne l’idée selon laquelle les sociétés minières devront redoubler d’effort pour gérer leur réputation en 2012. En tant que président du conseil d’administration de cette société de services professionnels, M. Ives estime que les minières font désormais partie de l’actualité quotidienne et, selon lui, cette visibilité accrue nécessite une plus grande participation. « Les gens qui ne font pas partie de l’industrie tiennent souvent pour acquis que ce qui se passait il y a 30 ou 40 ans est encore vrai aujourd’hui », explique M. Ives. L’industrie doit élaborer un nouveau cadre de référence. Dans un autre domaine que celui des relations publiques, M. Ives prédit que la pénurie de main-d’œuvre représentera un autre défi pour les sociétés minières en 2012, car de plus en plus de travailleurs expérimentés prennent leur retraite. « Beaucoup de personnes qui sont arrivées dans le secteur minier dans les années 1960 et 1970 arrivent au terme de leur carrière », souligne-t-il. « Parallèlement à ce phénomène, les jeunes n’ont souvent pas envie d’aller travailler dans un site minier éloigné. » Selon M. Ives, la planification de la main-d’œuvre requiert un plus grand investissement dans la technologie. « Les entreprises doivent également embaucher des employés qu’elles peuvent affecter dans toutes leurs mines plutôt qu’à un seul endroit », déclare-t-il. « Une telle 48 | CIM Magazine | Vol. 6, No. 8

mobilité permet de réduire les effectifs et de rendre le travail plus intéressant. » Le nationalisme des ressources constitue une autre tendance mondiale mise en lumière par Glenn Ives. La demande en produits de base explose à mesure que les économies émergentes s’industrialisent. En même temps, divers pays imposent des restrictions en matière d’exportation des ressources naturelles, paralysant ainsi certains marchés qui s’approvisionnent habituellement auprès d’eux, ou exigent le rapatriement des profits. On peut lire dans un rapport de Deloitte que cette tendance a une incidence sur les prix des produits de base et sur la façon dont les sociétés minières exercent leurs activités. « On ne peut pas déplacer les ressources. La collaboration avec les gouvernements locaux est essentielle. J’espère que ces gouvernements comprendront que leur stratégie fait en sorte que les gisements plus petits et moins accessibles ne seront pas exploités, et c’est ce qui est vraiment préjudiciable pour un pays en développement. »

Un monde de possibilités Doug Horswill, vice-président principal, durabilité et affaires extérieures, Teck Resources, est moins préoccupé par le nationalisme des ressources. « C’est un concept véhiculé par les médias qui affole tout le monde », prétendil. « Il y a très peu de pays qui ont retiré aux entreprises des droits qu’ils leur avaient accordés, du moins pas sans les dédommager. » La valeur des ressources augmentant, M. Horswill soutient qu’il est légitime pour les citoyens des pays en développement d’espérer obtenir une plus grande part du rendement généré par ces ressources. « Les futures modifications du régime fiscal servant l’intérêt public sont légitimes pour autant que les activités déjà établies continuent d’être régies par les mêmes règles qui existaient au moment de l’investissement initial », précise-t-il. Teck détient des participations diversifiées, notamment dans le cuivre, le charbon à coke métallurgique, le zinc et l’énergie, au Canada et en Amérique du Sud. Malgré la volatilité des marchés en 2011, M. Horswill affirme que la société s’en est bien sortie. « Nos acheteurs ont continué d’acheter, et nos prix sont demeurés élevés », souligne-t-il. « Teck a enregistré des produits d’exploitation et des profits record au troisième trimestre, et ses liquidités dépassent maintenant 4,5 milliards de dollars. » Il ne fait aucun doute que l’Asie sera la locomotive économique des dix prochaines années, voire plus. Ce qui pourrait de plus compromettre la situation enviable dans laquelle la Chine se trouve actuellement, ce sont les défis qu’elle doit relever sur le plan de la gestion environnementale. Si elle ne prend pas de mesures efficaces pour réduire la pollution, les répercussions sociales pourraient être graves. C’est dans ce domaine que M. Horswill entrevoit d’excellentes possibilités pour les sociétés canadiennes. « Toute entité qui aidera la Chine à résoudre ses problèmes environnementaux se placera dans une position avantageuse. » ICM

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commodity review IRON

WORKHORSE OF THE NORTH

Courtesy of Baffinland Iron Mines Corp.

Company of Canada operate four open pit mines there. Combined, they shipped 33 million tonnes of processed iron ore in 2009. The southern Fermont area of the Trough contains the sinter-quality hematite sought by 80 per cent of the global fines market. Consolidated Thompson, acquired this year by Cliffs Natural Resources, defined the exploration possibilities of this locale with its two-year-old Bloom Lake project. In 2013, Bloom Lake will ramp up to a yearly 16 million tonnes of iron ore concentrate, with at least a 17year mine life. More than one explorer would love to develop the next Bloom Lake. Alderon hopes to contribute another 16 million tonnes from its Kami property, now in the prefeasibility stage, with Indicated A haul truck unloads near Baffilnland Iron Mines’ DSO property on Baffin Island, Nunavut. Resources of 490 million tonnes grading a typical 30 per cent iron. Champion Minerals’ flagship property, Fire Lake North, hina’s tighter monetary policies and the Eurozone which is adjacent to ArcelorMittal’s Fire Lake Mine, contains debt crisis sent iron ore spot prices from a record a coarse-grained hematite. Its current Measured and Indihigh of US$192 per tonne in February to a low of cated Resources of 400 million tonnes, grading 30.6 per US$128 in October. The sudden gap between spot and cent Total iron, with 661.2 million tonnes of Inferred quarterly contracts led to contract renegotiations and Resources grading 27.7 per cent Total iron, will be further quickly propelled the market towards short-term pricing. defined in a feasibility study due to be completed in the secBut such is the strength of the value of iron that a 33 per cent drop leaves mine operating margins healthy. “We still ond half of 2012. In November, the company released a Presee that there is margin in the operations that exist today,” liminary Economic Assessment for the Fire Lake North propsays Geordie Mark, research analyst at Haywood Securities. erty that established a net present value of $4 billion at a dis“We think ultimately the support for long-term prices is counted cash flow rate of eight per cent. around the marginal cost of production in the largest iron Further north, near Schefferville, Quebec, massive ore producing nation – China. That’s looktaconite projects balance lower quality ing at around US$120 a tonne.” with larger size. Adriana Resources is IRON ORE As existing iron producers proceed defining resources at its Lac Otelnuk projwith their large-scale expansions, explorect, last estimated at 4.89 billion Measers continue adding to the resource pool. ured and Indicated tonnes. According to “The softening in the price hasn’t their prefeasibility study, New Millennium changed our plans,” says Konstantine Iron Corp.’s LabMag and KéMag deposits Tsakumis, manager of investor relations at contain a combined 5.7 billion tonnes. Alderon Iron Ore Corp. New Millennium also holds 100 per cent interest in several direct shipping CANADIAN PRODUCTION 2010 ore (DSO) deposits near Schefferville Rising from the trough (kilotonnes) Alderon holds property in Canada’s that have been revived: its DSO project Newfoundland & Labrador 19,907 Labrador Trough, a varied region of with Tata Steel is slated to begin producQuebec 17,000 Labrador and northern Quebec that tion in 2012, close on the heels of British Columbia 94 accounts for 99.8 per cent of Canadian Labrador Iron Mines’ 2011 startup. Value = $4.9 billion iron ore production. ArcelorMittal, Cliffs Together, they will add up to 10 million Source: NRCan (preliminary estimate) Natural Resources and the Iron Ore tonnes a year.

December 2011 / January 2012 | 51

commodity review Plan ore The existing infrastructure in the Trough is part of what makes new projects economical, but to meet planned production increases, it will need to improve. Mining companies have discussed potential enhancements to rail, road and power lines with the government of Quebec, whose economic initiative, Plan Nord, is planning to invest a total of $80 billion over 25 years, via private and public investment, in the northern part of the province. The port of Sept-Îles is undertaking a major expansion to accommodate new shipments. The new multi-user facility at Pointe-Noire will accommodate 50 million tonnes starting in 2014, but could eventually handle twice that. Tsakumis says there will be a joint private/public partnership to fund the project. “The production expansion planned by a number of the

companies currently mining in the Trough, including 16 million tonnes a year from our Kami property, have highlighted the need for increased capacity at Pointe-Noire,” he says. With the Quebec government’s port expansion plans currently scheduled for completion in early 2014 and Kami coming on-line in 2015, the timing could not be any better for Alderon. Quebec’s transport plans pale in comparison to what will be needed by Baffinland Iron Mines. Jointly owned by ArcelorMittal and Nunavut Iron Ore Acquisition, the company is developing a $4 billlion DSO project on Baffin Island. After an environmental assessment comes out in 2012, the speediest scenario would see construction in 2013, and production three or four years later. For now, the Labrador Trough has no domestic rivals, but perhaps in the by E. MOORE future that will change. CIM

GOLD

Courtesy of Tyhee Gold Corp.

GILDED THRILL RIDE

Val Pratico, chief geologist for the Tyhee Gold Corp., stands on the outcropping quartz vein from Area 52.

hile the story for so many commodity minerals is all about China, the gold market is focused on Europe. As worries of sovereign debt in the Eurozone remain, investors seeking a way to preserve their wealth are continuing to push up demand for the precious metal. In these times of financial uncertainty, gold has become a de facto currency, says Patricia Mohr, vice-president, economics, and commodity market specialist at Scotiabank. “In recent years, gold has been monetized because of the weakness of the world’s two key reserve currencies – the U.S. dollar and the Euro – and so investors have lost faith in paper currencies and turned to

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

gold as an asset to maintain and store value,” she says. But turn the heat up too far, adds Mohr, and investors start turning away from the metal. “In times of extreme risk aversion, as we had in early October,” she explains, “investors still tend to shift into the security of U.S. Treasury securities — a very big, liquid market that is backed by the government.” According to Mohr, much depends on a lessening of broader credit concerns in Europe. If the more solvent Eurozone countries convince the markets of the Euro’s stability, she expects gold to remain relatively flat through 2012. Of course, if the markets are unconvinced, gold may go higher still. She also points out that the gold price remains highly volatile, as speculators sell off the metal after each price jump, which causes it to drop again – although few expect gold to drop significantly in the short term.

Advancing to production New and existing gold producers are seeking to capitalize on the opportunity and projects are underway across Canada. Mid-tier producer New Gold Inc. is expecting its New Afton gold-copper project in British Columbia to begin commercial production next summer, with 85,000 ounces of gold produced annually. Among the majors, Goldcorp has just had its position as the country’s premier producer reaffirmed by the Quebec government’s approval of construction plans at the Éléonore project. Slated for completion in 2014, Éléonore

commodity review will yield approximately 600,000 ounces annually. Goldcorp’s other Canadian project – Cochenour in Ontario – is also due to come on stream in 2014, at a production rate of about 275,000 ounces. Nearly half of Goldcorp’s 2.5 million ounces last year came from Canada.

GOLD

expect that to last through mid-2012, but there is no fixed end date – it’s an openended process,” says Webb. He also points out that demand for gold has driven up the cost of cyanide, which has tripled in the last year. Establishing numbers for engineering studies is an industry-wide problem. But, topping the list is the issue of CANADIAN PRODUCTION 2010 regulations, which Webb feels is keepThe exploration conundrum (kilograms) Despite the strong investor interest ing parts of Canada from benefiting Newfoundland & Labrador 166 and Canada’s many advantages as a from their vast mineral wealth. “If you New Brunswick 219 mining and resource powerhouse, the wanted to put a four-person camp on Quebec 25,230 long process of developing a project is the edge of a lake, access it by float Ontario 50,197 challenging, to say the least. Dave Webb, plane and drill a 50-foot hole into a Manitoba 4,443 president and CEO of gold junior Tyhee swamp to test a potential of gold showSaskatchewan 1,408 Gold Corp., says there is an outsized ing, you may have to file a full environAlberta 29 amount of risk in developing projects. ment assessment, which is a multi-milBritish Columbia 5,514 Yukon 2,367 Tyhee is currently in the feasibility study lion dollar undertaking,” he says. “The Nunavut 7,531 stage at its Yellowknife project in the trigger is set far too low.” Northwest Territories. “We initially applied Why push on in the face of such Value = $3.9 billion for our operating permits in 2005 – that challenges, especially when other jurisSource: NRCan was after doing two years of baseline dictions are more welcoming? “We’re studies,” he says. The process was restarted after the project working in an area where we have near exclusive access to changed in scope, in part because of rising gold prices. most of the Northwest Territories and very, very limited comThose changes required that the original application be with- petition by even the majors,” Webb responds. “We’re samdrawn, and a new application was filed in 2008. The company pling on a past-producing gold mine and a new discovery was referred to the environmental assessment review board we call Area 52, because that’s what the assay was – 52 and filed its environmental assessment report in the summer grams per tonne. We’re sitting there in the playground and of 2010. The technical review stage began in May 2011. “We there’s no kids looking in.” CIM by D. ZLOTNIKOV

December 2011 / January 2012 | 53

commodity review COPPER

EYES ON THE HORIZON Securing a supply

Courtesy of CMMC

End users of copper are understandably nervous about the supply shortfall, with some seeking more direct involvement as a way to ensure longterm access to the metal. The case of Copper Mountain Mining Corporation is one example. In order to finance its BC-based Copper Mountain Mine, the company entered into partnership with Mitsubishi Materials Corporation (MMC). Jim O’Rourke, Copper Mountain’s CEO, explains that MMC bought 25 per cent of the project – and the rights to purchase 100 per cent of the mine’s copper output. MMC still pays market price, O’Rourke says, but adds that “this is one way that they can assure long-term availability of concentrate, and I think they’re willing to help out to secure that stream.” No doubt, a guaranteed source of more than 47,700 tonnes (105 million pounds) of copper per year would go a long way towards relieving the Japanese partner’s supply headaches.

Flotation at the Copper Mountain Mine

n February 14, the LME settlement price for copper hit an unprecedented $4.60 per pound. Heading into December, uncertainty about both the fate of the Eurozone and demand from China had shaved more than 25 per cent from that early-year high. For producers, the Growing pains recent volatility is a distraction from long-term fundamentals. The surging copper price brought with it renewed attenOne Canadian company counting on continuing Chi- tion from juniors and majors alike, and with that attention nese demand is Capstone Mining Corporation. Capstone’s return familiar problems. Both Pylot and O’Rourke mention Minto Mine, located in the Yukon, is expected to produce skilled labour shortages as an area of serious concern, but over 18,000 tonnes (40 million pounds) of copper this year, Pylot adds that in Capstone’s experience, the problem is with the company’s Cozamin Mine in Mexico producing a less acute in some countries.“In Mexico and Chile, mining similar amount. Darren Pylot, Capstone’s president and is a larger part of their economies, so training has been CEO, says that while the company’s marketer is free to sell going on throughout; we don’t perceive that gap to be there the concentrate anywhere in the world, in the medium and short term,” he says. since the company first started production Another challenge, O’Rourke adds, COPPER in 2006, all of the copper has gone to lies in sourcing supplies and equipment. clients in Asia. “A lot of people are trying to get mines “We’re bullish on these economies coninto production, and so we are in a bit of tinuing to expand,” he adds. How bullish is an inflationary period in terms of fuel evident from Capstone’s growth targets: prices, steel prices – a lot of our consumthe company has an advanced developables,” he explains. ment-stage project in British Columbia and Analysts predict the market stabilizanother in Chile. If all goes according to ing around 2013, but with so much of CANADIAN PRODUCTION 2010 plan, both will enter production in 2015, the market depending on China, there is (tonnes) taking the company from 36,300 tonnes an inherent risk. Even a slight slowdown Newfoundland & Labrador 46,536 (80 million pounds) per year to more than in China’s growth rate could have seriNew Brunswick 8,481 136,300 tonnes (300 million pounds). ous repercussions for the world copper Quebec 23,935 A recent report by BNP Paribas estimarkets. But Pylot points out another Ontario 149,361 point in favour of copper. “On the supply mates the supply shortfall for copper this Manitoba 53,225 side it’s the most liquid commodity. You year to total 300,000 tonnes (approxiBritish Columbia 193,878 Yukon 23,034 can hedge copper if you want to offset mately 661 million pounds). For next year, your risk over as much as 10 years,” the global banking group predicts a Value = $3.8 billion CIM he says. “barely balanced” market. by D. ZLOTNIKOV Source: NRCan Courtesy of ECI

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

commodity review NICKEL

AWAITING THE REVOLUTION new processing methods for the more challenging, yet plentiful, laterite ores that will account for the majority of future production. More than twothirds of the world’s nickel ores are laterites, but they only account for 40 per cent of current production, thanks to their comparatively high processing cost. New demand has changed financial reckoning, but the technical kinks still need ironing out.

The Canadian equation

Courtesy of Royal Nickel

Canadian nickel operations, both existing and planned, have a technical advantage in that they exclusively mine sulphide ores. Expansions here also adhere more closely to schedule. Xstrata Nickel’s Raglan Mine in northern Quebec will be expanded from an annual production rate of 26,000 to Core testing at Royal Nickel’s Dumont property in Quebec 32,000 tonnes by 2014; its Fraser Morgan project in Sudbury will add nalysts generally agree on the future of the nickel another 6,000 tonnes per year of nickel starting in 2013; market, but the timeframe is difficult to judge. A and its new Nickel Rim South project is expected to proglobal oversupply of the metal has been on the duce 18,000 tonnes in 2011. Quadra FNX Mining Ltd.’s Levhorizon for years. But anticipated new major nickel proj- ack Complex is also expanding by an additional 16,000 ects have been slow to start up, confounding forecasts tonnes by 2012. A new mine, Ursa Major Minerals’ Shakeeach year. speare project near Sudbury, began commercial producThere is reason to boost production. Asia’s current tion in 2010, producing about 596 tonnes. Canadian operations have not been free of difficulty, hunger for raw materials extends to nickel, primarily used in making alloys. RBC Capital Markets predicts a growth in however. In August 2009, Vale halted its Voisey’s Bay operglobal nickel demand of 8.6 per cent in 2011 and 10.1 per ations during a workers’ strike, just as another strike at the cent in 2012. Most will be used in the procompany’s Sudbury operations was concluding. Voisey’s Bay did not resume full duction of stainless steel (65 per cent of NICKEL production until April 2011. Other smaller nickel consumption in 2010) or other mines also suspended operations due to alloys. China, as with other commodities, operational problems. is a driving force in the demand’s growth. The country accounted for 33 per cent of global nickel consumption in 2010, and A precarious balance looks to generate a comparatively high Because an oversupply seems immi19.4 per cent yearly demand growth in nent, investors have not been kind to 2011 and 2012. nickel. RBC’s 2011 average price forecast For now, nickel operators have not for the metal is only US$8.50 per pound, CANADIAN PRODUCTION 2010 (tonnes) matched that demand. However, by 2015, compared with $12 earlier this year. At RBC expects worldwide nickel production prices in the $8 range, some producers Newfoundland & Labrador 40,355 to increase by 574,000 tonnes – more will go out of business. Quebec 28,070 Ontario 50,701 than a third of the 1.55 million tonnes estiMark Selby, senior vice-president, busiManitoba 29,904 mated by the U.S. Geological Survey in ness development, of Toronto-based 2010. The delay has chiefly technical oriRoyal Nickel Corporation, takes the comValue = $3.3 billion gins: a number of planned projects rely on mon view that high-cost producers in Source: NRCan Courtesy of Royal Nickel

December 2011 / January 2012 | 55

commodity review China will bear the brunt of low nickel prices. These producers make a steel feedstock called nickel pig iron. “Even if you got in a surplus generated by this new capacity online, it would be largely offset by price drops that mean a certain amount of nickel pig iron capacity is shut down,” Selby says. “There’s already talk of nickel pig iron starting to curb production in China, which will balance the market more quickly than many people expect.” Royal Nickel recently completed a prefeasibility study on its $1.1 billion Dumont nickel project in Quebec. Beginning in 2015, the project would produce 44,000 tonnes per year over a 19-year mine life, followed by 12 years of processing lower grade stockpiles. Selby believes it will be one of few new supply sources after the currently planned projects finally come online. “Most of these projects that have been under construction for the last four or five years have been around on the drawing board for 30 or 40 years,” he says. “They’ve basically cleaned out the cupboard for projects that have been sitting on the shelf.” CaNickel Mining Limited, formerly Crowflight Minerals Inc., is in the process of ramping up its operation at the Bucko Lake Mine in Manitoba to 1,000 tonnes per day by the end of 2011. The company, which put the mine back into production last April, is also pursuing a winter drilling by E. MOORE program near the mine. CIM

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

commodity review ZINC

A BALANCING ACT mined out. The world’s largest mine, Teck Resources’ Red Dog Mine in Alaska, will be depleted in 2012, and both Minmetals’ Century Mine in Australia (the world’s second largest zinc mine at 500,000 tonnes per year [t/y]) and Vedanta Resources Plc’s Skorpion Mine in Namibia (145,000 t/y) are set for closure in 2015.

Scaling down Courtesy of Xstrata Nickel

Although the ease in oversupply may be welcomed by producers, there is concern about the lack of large mines set to replace these closures. The historic imbalance has kept interest in developing Xstrata’s Bracemac-McLeod Mine near Matagami, Quebec new projects low, so currently there are few large-scale projhe zinc industry’s story for the last decade has been ects in development. There has been little exploration one of oversupply, but that is changing. Global sur- either, with Hindustan Zinc in India being something of an plus has begun to fall – from 317,000 tonnes in 2011 exception. to an expected 135,000 tonnes in 2012, with a possible balSeveral operators are developing nearby projects, anced market by 2014. This trend may also put zinc prices although few rival the original mines. Red Dog is in the on the rise, if modestly. While some foreprocess of being replaced by the ZINC casts see the metal’s price plateauing, Aqqaluk Mine, which will extend operations until 2030; and Century is being others expect it to reach US$1,966.75 per tonne in 2012, after ending 2011 around replaced by the 200,000 t/y Dugald River $1,924 per tonne. Mine, which will come online in 2014. Global demand for refined zinc is up, In Canada, Xstrata will be closing its growing 2.2 per cent to 12.85 million Brunswick and Perseverance mines, which together produce 300,000 t/y. The tonnes in 2011 and heading to a growth Perseverance Mine will be replaced by of 3.9 per cent to 13.35 million tonnes in the 80,000 t/y Bracemac-McLeod Mine, 2012. At the same time, global mine prowhich has a current mine life of four duction increased 4.3 per cent to 12.77 years. Nyrstar will also be restarting its million tonnes in 2011 and a further Langlois Mine in northern Quebec in increase of 4.8 per cent to 13.37 million 2012 after putting it on hold for care and tonnes is expected in 2012. Global CANADIAN PRODUCTION 2010 (tonnes) refined zinc output increased 2.7 per cent maintenance following the economic to 13.16 million tonnes in 2011 and downturn in 2008. Newfoundland & Labrador 18,767 should increase by an additional 2.4 per One of the few greenfield operations in New Brunswick 186,812 cent to 13.48 million tonnes in 2012. development is Xstrata’s Lady Loretta Quebec 201,627 Ontario 82,333 This upswing is largely due to the Mine in Queensland, Australia. Slated to Manitoba 76,245 growing supply from China. But elsebegin operations at the end of 2013, the British Columbia 32,917 where, zinc output is diminishing. What is mine is expected to produce 126,000 Value = $1.3 billion driving the decrease in oversupply is a tonnes of zinc concentrate annually over Source: NRCan number of large zinc mines that are being a mine life of 10 years.

December 2011 / January 2012 | 57

commodity review By far the largest market factor is China, which is both the world’s largest zinc producer and consumer. The country produces about 30 per cent of the global supply, and Chinese demand is expected to grow 5.7 per cent in 2012. Chinese smelters are also pushing up global output of refined zinc, as China seeks to maintain its self-sufficiency in zinc production. Elsewhere, smelters are coming off a period of voluntary production cutbacks in the face of zinc stock accumulation, although production costs are also on the rise.

New markets Half of the world’s zinc is used in galvanization, the corrosion-resistant zinc plating of steel. Another 17 per cent is used in the production of brass and bronze, and 17 per cent in die casting. The construction and manufacturing industries consume a great deal of zinc, and rising automobile production is a boon to the industry.

New uses for zinc are being found in green technology as well, particularly in light-weight batteries. Current applications for zinc-air batteries (in which a chemical reaction between zinc and oxygen creates an electrical current) include hearing aids and various medical applications. They are also being tested for use in electric vehicles. ReVolt Technology has developed a rechargeable zinc flow air battery (ZFAB) to be used in hybrid electric vehicles and other consumer electronics. As well, China and India’s testing of the use of zinc with fertilizer has yielded positive results that could brighten the outlook for the metal: the addition of one per cent zinc to fertilizer has increased crop productivity by up to 10 per cent. If adopted, in China alone, said Teck Resources CEO Don Lindsay in a recent conference call, the added demand for zinc could reach as much as by C. BALDWIN 500,000 t/y. CIM

URANIUM

SHORT-TERM UNCERTAINTY

Courtesy of Cameco Corp.

mid-March, following a major earthquake and consequent tsunami, the Fukushima Dai-ichi nuclear power plant in Japan failed catastrophically, with three of its six reactors suffering partial meltdowns. Although the full scope of the accident’s effects has yet to be discovered, in the short term, the nearly 100,000 residents that evacuated the 20 kilometre exclusion zone are still displaced and will remain so until early 2012. As the extent of the accident became clear, more and more countries moved to review their own nuclear safety measures – or, as is the case of Germany, to completely end their reliance on nuclear power. This led to a sharp decline in uranium spot prices – Miners step off the cage at surface at McArthur River in the Athabasca Basin, the world’s leading uranium mine. from US$72.63 per pound to $52.25 by the end of April. Yet, ranium, like most commodities, saw prices despite these developments, uranium producers are feelplunge when the 2008 financial crisis hit. But, by ing fairly confident. Tim Gitzel, president and CEO of early this year, it showed significant signs of Cameco Corporation, told analysts in a November conferrecovery, with spot prices exceeding $72 per pound in ence call that the company was still on track both in terms January, up more than $30 from a year prior. Unfortu- of its 2011 sales and its long-term goal of doubling producnately, uranium took another big hit shortly thereafter. In tion by 2018.

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

commodity review Unwanted inventory

does not help exploration-stage compaURANIUM to Gitzel, the current fluctuaAccording nies that see their stock price and fundraising ability heavily impacted by the tions, which he expects will continue in spot price. “The short-term effect the short and medium term, are driven by Fukushima had on uranium company uncertainty over fuel already purchased stock prices makes it tough to raise capital by utilities in Japan and Germany. While in a depressed market,” Randhawa says. Japan is expected to restart some of its The experience of Vancouver-based reactors, Gitzel says that only 11 of the country’s 54 reactors are currently runHathor Exploration, with its Athabasca ning, and it is still unclear how many more Basin Roughrider deposit, is an excellent will be approved for restart and by when, example of these short- and long-term CANADIAN PRODUCTION 2010 putting future Japanese uranium buying forces at work. In the four days after the (tonnes) in question. The situation is even less cerFukushima incident, Hathor saw its share McArthur River/ 7,653 tain in Germany. As more power plants price plunge from $2.86 to $1.54. In Key Lake - Cameco are shut down, they may seek to sell off August, Cameco offered $520 million for Rabbit Lake - Cameco 1,462 their fuel stockpiles. Until the exact timing the junior, whose property is near the McClean Lake - Areva 666 and amount of such sales becomes clear, producer’s Rabbit Lake Mine. This was Source: Government of Saskatchewan uranium traders will remain concerned. the first offer in what became a bidding In contrast, Gitzel points to the developing nations as battle between the world’s premier uranium miner and Rio drivers of future demand. China, which slowed down its Tinto, who eventually prevailed with an offer of $654 milgrowth plans somewhat in the wake of Fukushima, is still lion ($4.70/share). expected to reach 60 to 70 gigawatts of nuclear generating It still remains to be seen what the long-term effects of the capacity by 2020, up from the current level of 12 gigawatts. Fukushima crisis will be. But, given the expansion plans of In its third-quarter MD&A report, Cameco calls China the many of the world’s existing nuclear consumers and uralargest example of a trend. Most of the world’s nuclear nium producers, and the competition for Hathor, demand nations are either maintaining their reliance on nuclear or for the development of quality uranium deposits seems by D. ZLOTNIKOV are actively expanding their nuclear generation capacity, secure. CIM and more non-nuclear countries are turning to nuclear to meet their energy demands.

The Athabascan advantage Given the projected growth in demand, established operators are looking to expand their production, and Saskatchewan’s Athabasca region is a prime target. Devinder Randhawa, chairman and CEO of Fission Energy, an exploration firm with 11 of their 13 properties located in the Athabasca Basin, explains that the ore found there offers grades 10 to 20 times the world average. Randhawa also points to existing mill capacity in the area, which could offset the need for significant capital outlay for new projects. But it is important to recognize that there are two, sometimes very different, uranium prices: the spot and the longterm contract. Utilities wish to minimize uncertainty and seek to secure their fuel supplies early on. As a result, most of the world’s uranium is sold under long-term contracts, which offers greater stability to producers, but it December 2011 / January 2012 | 59

commodity review POTASH

Courtesy of The Mosaic Company.

PLENTY OF THOUGHT FOR FOOD expansion plans. PotashCorp read the signs in 2003 and planned a $7.5 billion series of expansions that will nearly double operational capability between 2005 and 2015, reaching 17.1 million tonnes. Mosaic intends to add an average of 300,000 to 500,000 tonnes a year between 2010 and 2020. Agrium's one producing site, the Vanscoy Mine in Saskatchewan, will be up by 750,000, reaching 2.8 million tonnes in 2015. The majors have chosen to expand existing operations because it is shockingly expensive to build a new potash operation. PotashCorp estimates that it would take $4.1 billion and seven years to bring a two-million-tonne greenfield potash mine and mill into production. "We're doing brownfield expansions because, on a cost per tonne basis, it's about 40 per cent of what bringing on additional tonnes by greenfield would cost," says Bill Johnson, senior director, public affairs at PotashCorp. "We don't think prices as they currently stand would justify us doing a greenfield expansion."

A growing appetite for risk

The Mosaic Companyâ&#x20AC;&#x2122;s Esterhazy operation

hen earth welcomed its seven billionth human in October, the event came as no news to the potash industry. Population growth is one of the fundamental drivers of potash demand. Refined into potassium chloride and other potassium compounds, this mineral provides one of the three critical ingredients of crop-boosting chemical fertilizers. Canada is the world's largest potash producer at around a third of global mining output (according to a 2010 USGS estimate, 9.5 out of 33 million tonnes K20); its resources are concentrated in Saskatchewan and Manitoba. So concentrated, in fact, that explorers do not typically look far afield: PotashCorp's lone New Brunswick project was discovered on a hunt for diamonds. Three companies control Canada's producing mines: PotashCorp, The Mosaic Company and Agrium, and together sell their output through the Canpotex marketing agency. With supply tight, each has been working on

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

For potash hopefuls, the current prices look good enough to take on the risk. BHP Billiton, Rio Tinto and German major K+S have all moved in on properties in Saskatchewan. BHP has thus far spent US$1.2 billion developing its feasibilitystage Jansen project. If approved, the mine is expected to begin operations in 2015 and eventually generate eight million tonnes per year. In late November, K+S approved $3.25 billion in capital expenditures to develop the Legacy project it acquired through its 2010 purchase of Potash One. The solution mine is also expected to start in 2015 and will have a projected output of 2.86 million tonnes per year. While consolidation, POTASH historically, has been the name of the game, several explorers are looking to continue into production themselves. Western Potash Corp. has released a prefeasibility study for its Milestone project, a 2.8-million-tonne operation that would cost only $2.7 bilCANADIAN PRODUCTION 2010 (kilotonnes) lion to build -- including port facilities -- with PotashCorp 8,000 payback in five years. Agrium 1,784 Two juniors, Karnalyte The Mosaic Company* 7,200 *year ending June 2011 Resources and Encanto Potash, also aim to Value = $5.6 billion become producers. Source: Potashcorp, Agrium, The Mosaic Company, NRCan

commodity review "There's been no junior going into production in decades," says Gary Deathe, business development consultant for Encanto. Deathe's explanation goes back to the concentrated nature of potash resources. Large tracts are limited, he says, and often controlled by major producers or speculators. The founders of Encanto turned to First Nations as partners. "Some of these First Nations have big properties, 30,000 to 100,000 acres, and they control their potash rights, says Deathe. “The founders of Encanto said, 'Listen, we think we can help you establish a potash resource and get some significant long-term revenues, educational and employment opportunities.’"

Encanto is now developing its flagship property with the Muskowekwan First Nation. Deathe says the Nation's primary benefits are predicated on the benefits of continued production, making it far less likely to sell to a major, who may not develop it in a timely manner. If the demand for potash will be as strong and sustained as current producers expect, perhaps newcomers to the industry will become similarly resourceful in developing potash deposits. Saskatchewan alone holds more than one billion tonnes. CIM by E. MOORE

DIAMONDS

SELLING DREAMS

Courtesy of Shear Diamonds

The dream is also catching on in new places, says Julie Lassonde, executive chairman and CEO of Shear Diamonds, a junior working on restarting the Jericho Mine in Nunavut. Recently back from Antwerp, Belgium, she says the shift is immediately obvious. “You could see it,” she explains, “just the number of Indian and Chinese purchasers in Antwerp. India is coming on very strongly on the heels of China.” And China alone is making a huge splash in the markets, she adds. “There are some 130 million carats of diamonds produced worldwide. Of these, only 25 million carats are gemstone quality. So for China to be suddenly vastly interested in diamonds, a lot of diamonds will have to be produced to meet that demand.” Lassonde’s position is supported by the price fluctuations in the market – as much as 40 per cent from January to August of this year, she says. “We’ve always known there’d be growth coming from places like China and India, and we’ve seen those be much of the growth catalysts in late 2010 and in 2011,” agrees Ormsby, although he feels that the United States will still remain the top diamond consumer for some years to come. There is no disagreement on the main point, however. There is plenty of demand for the high-quality diamonds for which Canada is becoming known.

Shear Diamonds’ Jericho property in the Northwest Territories

hen it comes to things one digs out of the ground, diamonds are unique. They are not valued for their importance to the growing electric vehicle industry or their usefulness in steel production. People in the market for a diamond are not just buying a diamond – they are shopping for a dream. But do people still shop for dreams in difficult economic times? The answer is both yes and no. According to Tom Ormsby, director of external and corporate affairs at De Beers Canada, diamond sales slowed to a crawl when the financial crisis first hit. Also, the current turmoil in the Eurozone was expected to have a similar effect on the world’s largest diamond market – the United States. “But the pleasant surprise has been that for the diamond industry, the U.S. has shown stronger than expected diamond demand at the retail level as compared to what many thought might have been the outcome based on the 2008 to 2009 example, when the economy started to wobble,” he says.

Expanding sector Ormsby says that while Canadian operations contribute only five per cent of the total carats produced by De Beers, they punch well above their weight in terms of value, due to the quality of the diamonds. “The revenue is more like eight to nine per cent of the De Beers total,” he explains. December 2011 / January 2012 | 61

commodity review DIAMONDS De Beers is aiming to further capitalNo illusions on this premium with aggressive ize The downside of Canadian diaexpansion plans: advanced exploration mond operations is their relative on key diamond-bearing pipes at Victor expense. Lassonde says the Jericho in Ontario, ramping up to full production Mine – with a capacity of 375,000 at the Snap Lake Mine and permitting carats per year – is probably the underway at the Gahcho Kué project, smallest size at which one could both in the Northwest Territories. Victor, operate at a profit. The challenges, which has a life-of-mine average of she explains, stem largely from the 600,000 carats per year, has produced combination of extreme remoteness CANADIAN PRODUCTION 2010 over 800,000 carats each of the last two of most diamond finds and the (carats) years. While at full capacity, Snap Lake is extreme weather conditions in which Victor Mine 826,000 expected to produce 1.5 million carats the mines must operate. De Beers Canada per year. Gahcho Kué, though, is the big Recently, BHP Billiton announced Snap Lake Mine 926,000 deal: If all goes according to plan, says it was considering the sale of its diaDe Beers Canada Ormsby, the project should be producmond portfolio, which includes a Diavik - Rio Tinto 6,500,000 ing up to 4.5 million carats per year, takmine and exploration property in the EKATI - BHP Billiton* 2,793,000 ing De Beers Canada past the six milNorthwest Territories. The company *year ending June 2011 lion-carat mark (and Canada from 10.7 explained in a news release that its Value = $2.3 billion million to over 15 million carats). “strategy is to invest in large, long life, Sources: De Beers Canada, Government of the In November, Stornoway Diamonds upstream and expandable assets Northwest Territories, BHP Billiton moved one step closer to securing its while remaining a simple and scalaplace among Canadian diamond producers with the release ble organization. EKATI is a world-class operation, and of the feasibility study for its Renard project in central Quebec. Chidliak is a promising exploration opportunity, but many The study outlines an open pit and underground operation years of extensive exploration suggest there are few that would average 1.7 million carats over an 11-year mine life. options to develop new diamond mines that are consisby D. ZLOTNIKOV The project has an estimated initial cost of $802 million. tent with this approach.” CIM

CEMENT, STONE & AGGREGATES

HARD TIMES

Courtesy of the Cement Association of Canada

The Confederation Bridge connecting Prince Edward Island to New Brunswick is a monument to cement’s vital role in Canada’s infrastructure.

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

ou would think that aging infrastructure in Canada and the United States, and resulting initiatives to build new roads, bridges and hospitals would signal new hopes for producers of cement, stone, sand and gravel. However, the sectors continue to navigate a variety of challenges and opportunities on the business, economic, domestic and export fronts, and companies are struggling to adapt. “The strengthening dollar and the U.S. recession have considerably dampened demand in the industry’s largest export market,” notes Michael McSweeney, president and CEO of the Cement Association of Canada. “This has been exacerbated by challenges from importers, who are now grabbing an increased share of the domestic market.” Earlier this year, cement production in the United States hit a 28-year low and, with production facilities there idle, it is hard for Canadian companies to get a hearing from clients. Here in Canada the picture is not much better. Production has fallen from 14.4 million tonnes in 2007 to 11.6 million tonnes in 2010, and for 2011 is expected to slip further, to an estimated 11.0 million tonnes. The strong loonie not only makes local goods more expensive in export markets, but also gives

commodity review

Making a better case on the environmental front

CEMENT, STONE & AGGREGATES

Courtesy of Holcim

Canadian cement consumers more purchasing power on international markets, making imports relatively cheaper. Nowhere is this more apparent than in British Columbia where, according to McSweeney, imported cement now accounts for 24 per cent of consumption, up from just three per cent in 2007 – an increase due in no small part to the carbon tax applied by the province to its domestic, but not imported, cement.

CANADIAN PRODUCTION 2010 Cement Sand and gravel Stone

The industry took another big blow with British Columbia enacting a woodfirst policy for construction, and Quebec has been sending signals it may follow BC’s lead. McSweeney challenges these provincial moves, which he characterizes as poorly designed policies. “These types of initiatives serve to push production overseas, into jurisdictions where environmental oversight is less of a priority,” he says. “Furthermore, they are often based on inadequate or incomplete competitiveness assessments.” McSweeney cites government purchase decisions regarding road construction, which tend to specify asphalt in bid documents, despite the fact that concrete roads have a significantly longer service life – which more than compensates for possible initial cost differentials. (Asphalt prices are heavily tied to oil prices, and when these rise above $70 per barrel, concrete roads are cheaper even on a straight-comparison basis).

A part of the neighbourhood

often have multiple alternate uses, ranging from agriculture to residential housing developments. The second is educating environmental activists, who are often unaware of how responsive the mining industry can be to local concerns when developing new resources.

A focus on innovations

In October, the industry announced a new, environmentally friendlier cement named Contempra, which requires less clinker – cement’s energy-intenSource: NRCan sive main ingredient. The cement is comprised of 15 per cent ground limestone compared to only five per cent in regular Portland cement, yet it produces concrete comparable to traditional mixtures. Contempra, which promoters say reduces CO2 emissions by 10 per cent, is recognized under the name Portland Limestone Cement by the Canadian Standards Association, the 2010 National Building Code of Canada and the building regulations of British Columbia, Manitoba, Ontario, Quebec and Nova Scotia. However, according to McSweeney, industry can only do so much, and to reach its full potential it will need help on the public policy front. “If governments can coordinate their efforts on the environment to create a more simplified and level playing field, and bring in fairer tax policies,” he says, “this sector could recover much faster.” CIM

Kilotonnes 11,692 205,804 147,643

Value (billion) $1.518 $1.506 $1.390

by P. DIEKMEYER

“There are many pit and quarry license applications in the works right now, and approvals in process,” says Moreen Miller, president of the Ontario Stone, Sand & Gravel Association. “However, the province continues to grow at a rapid rate, which means demand for aggregates near expanding urban areas continues to be strong.” The challenge, says Miller, is that transportation expenses form a huge percentage of overall aggregate prices. “Half of the product costs consist of moving it from where it is extracted to where it is used,” she says. “That means the pressure to develop resources that are close to where they are used is high.” This presents the industry with two challenges in getting mine approvals. The first is that Ontario’s rapid expansion means that potential resource sites December 2011 / January 2012 | 63

commodity review OIL SANDS

EFFICIENCY GAINS Courtesy of Cenovus Energy

combining steam with solvent at their Algar project, with a corresponding production increase of 23 per cent. Cenovus Energy has achieved an SOR of 2.5 at their Christina Lake operation, and is testing the use of wedge wells to access the unrecovered bitumen between sets of SAGD wells. Cenovus has received approval for major expansions at both its Christina Lake and Foster Creek SAGD projects. Production capacity at Christina Lake will increase from 98,000 to 218,000 barrels per day (bpd), and Foster Creek from 120,000 to 225,000 bpd. The comCenovus Energy’s Foster Creek SAGD operation pany hopes to produce over 400,000 bpd by the end of 2021. lthough bitumen too deep for conventional mining Seven in situ projects are scheduled for startup between accounts for 80 per cent of Alberta’s oil sands 2012 and 2013, notably phase 4 of Cenovus’ Christina reserves, in situ operations only contribute about Lake project and phase 4 of Suncor’s Firebag project. For half of oil sands production. Their share is growing steadily, mining projects, Imperial Oil’s Kearl Mine is scheduled for however, driven by new technology and extraction methods startup in 2012, with a capacity of 110,000 bpd, with two designed to increase recovery rates. In additional phases approved for an addiSYNTHETIC CRUDE AND BITUMEN situ production rates are expected to tional 200,000 bpd. overtake those of mining by 2015 and New projects are taking advantage could reach 1.92 million barrels per day of high oil prices, which have remained (Mbpd) by 2020. steady after leaping to US$100 a barrel in March 2011 off of strong global demand. Oil is expected to remain Steam sippers Nearly all in situ operations are strong in 2012, with forecasts between involved in pilot projects using a variety US$95 and $110. of new methods and technologies, including the addition of solvents and The pipeline pinch polymers, electric submersible pumps, The U.S. is the largest market for vapour extraction, in situ combustion Canadian oil, and Canada its largest CANADIAN PRODUCTION 2010 (toe-to-heel air injection) and carbon supplier, providing over 2 Mbpd. There (thousands of m3) dioxide injection. remains, however, an oversupply of Mining Steam-to-oil ratio (SOR) – barrels of domestic oil in Canada, which is only Synthetic crude 37,656 water used to produce a barrel of oil – able to refine about 1 Mbpd of western Bitumen 6,218 is a key measure of steam-assisted Canadian supply. In situ 40,823 gravity drainage (SAGD) efficiency. The U.S. Gulf Coast, North America’s Oil sands producer sales = $36.6 billion Connacher Oil and Gas Limited has largest refining district, is critical to Source: Canadian Association of Petroleum Producers reduced their SOR by 15 per cent by Canadian production. Its 50 refineries

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

commodity review

have a refining capacity of 8.9 Mbpd, over half of which can process heavy crude oil. These refineries, in turn, are looking to replace declining supplies from foreign and domestic sources. Yet of the 5.3 Mbpd of foreign crude oil refined on the Gulf Coast in 2010, only 119,100 were from Canada. The industry is held back by pipeline capacity limitations. Canadian oil travelling by pipeline to Gulf Coast refineries must eventually pass through Pegasus Pipeline, which has a capacity for Canadian crude of less than 97,000 bpd. The industry’s answer is the proposed TransCanada Keystone XL pipeline, a direct route from Alberta to the Gulf Coast that could carry an additional 700,000 bpd. Together with two completed stages of the Keystone, total Keystone capacity would be 1.29 Mbpd. In November, the U.S. government delayed the approval decision on Keystone XL until 2013. While this was a disappointment to the industry, the effect on oil sands operations will be minimal. The industry remains confident that the

pipeline will be approved, and most projects under development will not be sending supply to the market until after the approval decision. In the meantime, creative steps are being taken to increase supply to refineries. Enbridge is reversing the direction of its Seaway pipeline, sending an additional 150,000 bpd to the Gulf Coast. More attention is now being given to the fast-growing Asian markets, especially as the industry is keen to diversify in its markets beyond the United States. Again, there are hurdles in pipeline capacity – Kinder Morgan’s Trans Mountain pipeline is currently the only option for Alberta crude heading to the West Coast. A proposed Trans Mountain extension could increase capacity from 300,000 to 700,000 bpd, and could be built by 2016 if approved. Enbridge’s proposed Northern Gateway pipeline, with a 2014 startup, would have a capacity of 525,000 bpd. CIM by C. BALDWIN

COAL

BURNING DEMAND

Courtesy of Swan Hills Synfuels

by 2030. A similar need for thermal coal will arise from planned power generation in China and India, which have limited reserves. Teck Resources Limited reports that while its steel customers have been deferring shipments, they continue to produce from existing inventories. Analysts now forecast a softening in the international markets for both coking and thermal coal. Still, the numbers remain high by historical standards, above US$200 per tonne of metallurgical coal and US$100 per tonne of thermal.

Feeding blast furnaces

s the 2011 Chinese growth slowdown and European debt crisis ripped into commodity prices, coal held up remarkably well. Australian floods and other supply disruptions pushed up coal prices early in the year; the lingering effect may be prolonged by another season’s rains. But the underlying story is one of demand from emerging markets. Wood Mackenzie predicts that Asia will account for 75 per cent of global metallurgical coal demand

Projects that had been mothballed in leaner times are now coming back into production. The restarted Willow Creek Mine in British Columbia, which Walter Energy took over in its 2010 acquisition of Western Canadian Coal, will eventually produce 1.7 million tonnes a year of steelmaking coal. Teck is running a new feasibility study on its closed Quintette Mine in British Columbia, which it expects will produce three million tonnes. A joint venture between Fortune Minerals Limited and Korean steelmaker POSCO is developing the new Mount Klappan project in northwest British Columbia, which contains 2.8 billion tonnes of anthracite resources. Xstrata Coal is looking at a number of properties in Canada. In addition to its Donkin Exploration project in Nova Scotia, December 2011 / January 2012 | 65

commodity review the company acquired First Coal Corporation in the Peace River area of British Columbia and the adjacent Lossan deposit from Cline Mining Corporation. “The combined licenses have the potential to support the production of a range of export quality metallurgical coals sharing common infrastructure,” says James Rickards, Xstrata’s group manager – media and communications.

COAL

Another approach to Asia

the site has Measured and Indicated Resources of 985.4 million tonnes of low-sulphur bituminous coal – all bound for the Asia-Pacific Rim. Chris Borowski, manager of investor relations for Coalspur, explains that the potential for profits on domestic coal sales within the United States and Canada are much lower than in international markets. “Firstly, the domestic market is much smaller than the international market, and secondly, the prices that end users in Korea, Japan and China are willing to pay are much higher, even when transportation costs are accounted for,” he says.

CANADIAN PRODUCTION 2010 International exports also shape the (kilotonnes) future for Canadian thermal coal proCoking coal 27,000 duction. Domestic coal-fired power genSteam coal 40,000 eration is on a downward trend, as Value = $5.5 billion Ontario phases out its coal plants and Source: NRCan, WCA no new plants are built. The last few Port buildups years of development activity at Sherritt To accommodate a greater amount International Corporation, which produces 94 per cent of of exports, British Columbia’s ports will need to expand. Canadian thermal coal (39 million tonnes in 2010), have tar- Plans are already in the works at Westshore Terminals to geted international markets. increase capacity from 28 to 33 million tonnes per year; and Thermal coal exports have attracted Coalspur Mines Ridley Terminals Inc. in Prince Rupert, the closest to Asian Ltd., which will release a bankable feasibility study in early markets, will double its capacity from 12 to 24 million tonnes 2012, detailing its planned Vista coal project near Hinton, by 2014. If the market scenario allows, Ridley could grow Alberta. Targeted to begin production with 2.5 million even further. “We are engaged with the Prince Rupert Port tonnes in 2015, ramping up to 11.2 million tonnes in 2019, Authority (PRPA) to secure more lands,” says Ridley chairman Bud Smith. “If PRPA grants Ridley Terminals a lease for their development, these lands could be used to build capacity well beyond the 24-million-tonne threshold.”

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

Natural Resources Canada estimates the country’s Proven coal reserves at 8.7 billion tonnes. Proponents of underground coal gasification (UCG) argue that with new technologies, the amount of recoverable coal might be higher. The Alberta Geological Survey estimates that the plains area could contain over three trillion tonnes of coal, most of which is inaccessible through conventional mining methods. Swan Hills Synfuels has operated a UCG demonstration project in Alberta for two years and plans to begin developing a commercial-scale project in 2012, while Laurus Energy has acquired land for a demonstration project. If these projects show commercial and environmental success, they could change the way coal is extracted. CIM by E. MOORE

project profile

Courtesy of Canada Lithium Corp.

Construction superintendent Marco Plourde at the Canada Lithium Corp.’s Quebec lithium project

Lithium mine is recharged by | Eavan Moore

A long-shuttered hard rock lithium mine in western Quebec has become economical again, thanks to growing battery demand.

When the Quebec Lithium Mine in Val-d’Or shut down in 1965 after 10 years of operation, its owners believed they would be back to restore it within months. They were wrong. The U.S. government had kept the lithium trade busy by using the metal in its defense industry research, but after reductions in lithium purchases by the United States, the mine’s operating margin disappeared. Throughout the 1960s and 1970s, researchers in Montreal and Ottawa studied process improvements to lower the costs of extracting lithium, but to little effect. A new company bought the Quebec property in the 1980s, but ultimately gave up the mine to rehabilitation when prices stayed low and its margins failed to improve. Quebec’s story is not unique; of all the lithium producers that opened up shop in North America, only one American company is still producing.

But in the last decade, lithium batteries have gradually begun to see widespread use. The new demand for portable electronics has roughly doubled the price of lithium and with that, the promise of profitable mine production has been renewed. In 2008, the Quebec Lithium project was acquired by Canada Lithium Corp., which plans to restart the operation for a substantial reward. “The fact that there’s been a mine before gives us a huge amount of information,” says Charles Taschereau, chief operating officer of Canada Lithium. The company had 400 historical drill holes and the records of previous processing developments to work with. After further drilling and metallurgical testing, recent figures reported by AMC Mining Consultants in June 2011 show Proven and Probable Reserves of 17.1 million tonnes of spodumene ore at 0.94 per cent lithium, and an updated resource December 2011 / January 2012 | 67

Courtesy of Canada Lithium Corp.

project profile

Although more capital intensive than lithium produced from brine, hard rock deposits (shown above) can be processed and brought to market more quickly.

estimate, released in December, put the Measured and Indicated Resources at 33.2 million tonnes. The ore veins are close to the surface, requiring very little pre-stripping and allowing an open-pit plan for the duration of the currently planned 15-year mine life. Although the properties’ existing documentation has been helpful, the infrastructure of the old mine is gone: grass now grows where structures used to sit. “There’s nothing left for the new mine,” says Taschereau. Even the rail spur had been removed and will now need to be rebuilt. By October, Canada Lithium had assembled about twothirds of its initial US$207 million capital costs. It expects to be in production by late 2012, with first sales and full production in 2013. Site preparation was completed last September and construction on facility buildings is underway. In April 2012, delivery of the major process equipment will begin, and the following month, the main mining fleet will be on site. Contracts for the crushing and flotation circuits, ball mills, kiln and high-voltage switch gear have all been awarded. 68 | CIM Magazine | Vol. 6, No. 8

Good neighbours The advantages of re-establishing a new mine on an old mine go beyond drill cores and documentation. Canada Lithium can see the legacy of past tailings management and reclamation work, and it appears benign. “What’s going into the tailings dam is 99 per cent silica,” explains Taschereau. “There are no sulphides in the ore and the waste is dark granite, a very inert rock. The reagents are consumed at the processing stage. The old tailings impoundments were not built to current standards, but you can see that all around, there are fish in the water and no damage to the environment. And our tailings will be much safer than that.” Canada Lithium worked to avoid surprises in its development of the project. “There are people living in villages nearby and there’s a ski hill just six or seven kilometres away,” says Taschereau. “We started to have meetings with those people two years ago and we integrated their comments into the design. We want to make sure that everybody feels that they’re better off with a mine in the area than without.”

project profile For example, the original locaLithium has its predecessors’ flowsheets to PROJECT SPECS tions for the waste piles and prostudy. Ultimately, the company has made LOCATION: La Corne Township, Quebec cessing plant were altered to allevionly small modifications to the original MINERAL TONNES GRADE ate noise concerns. The company process. “We have much more instrumentaRESOURCES: (M) (LI2O%) Measured 6.91 1.18 also helped the local hotel secure a tion,” he says, “but all the chemical processes Indicated 26.32 1.19 bank loan to build new cottages by and reactions are the same.” MINE LIFE 15 years paying into the construction effort As the project is envisioned in the feasibility study, mined ore will be hauled by truck and committing to use those cotOPERATION Open pit to a processing plant. After a run through the tages to house out-of-town staff. LIFE-OF-MINE STRIPPING RATIO 5.54:1 primary crusher, the ore will go to a photo“It’s a win-win situation,” says metric sorter that measures the light Taschereau. “We help them with a INITIAL PRODUCTION DATE Late 2012 reflected from different chunks, separating project, and for us, it’s very nice to ANNUAL OUTPUT 20,000 tonnes of 99.5% the rock by colour. The dark granite waste tell our people that they’ll be living lithium carbonate rock will be shunted aside, while the palenear a ski hill.” PROJECTED OPERATING COST coloured spodumene will progress to further The mine sits 60 kilometres north US$3164/tonne of lithium carbonate crushing, grinding and flotation. of Val-d’Or, an area with a long minThe result of that first beneficiation is ing history, good infrastructure and LITHIUM PRICE FOR FEASIBILITY STUDY US$5875/tonne expected to be a 6.5 per cent lithium conplenty of available skilled labour – centrate. The company will likely sell some most of the mine employees will live concentrate to glass and ceramic makers, who form 31 per nearby. Taschereau points out that instead of going with one cent of the global market for lithium, but the rest of the conlarge contractor for the preparation work currently underway, centrate will enter a second refining round. Here, the spothe company is using a collection of local contractors. “We dumene is first heated in a kiln to make its structure ready for have over 12 companies that are working on site right now, sulphation. Sulphuric acid is then added and the resulting most of them with one or two pieces of equipment,” he says. lithium sulphate is dissolved with water. Two rounds of “The primary reason was to make sure that economic activity stays as local as possible but I think, overall, it probably also helps us to get better rates and to better control the job.” The area’s relative proximity to Montréal – a five-hour drive away – helps with the larger equipment. “A lot of Metso’s assembly is done here in Montréal,” says Taschereau. “So it’s easy for us to keep contact and work with the engineers.”

Brine versus brawn Globally, hard rock lithium mines are rare. Lithium occurs naturally in brine pools, which can be pumped into evaporation ponds for lower cost and lower energy extraction. The world’s largest lithium producers run brine operations in South America. But when it appears in the hard rock mineral spodumene (a.k.a. lithium aluminum silicate), lithium may be extracted using techniques commonly used for other minerals. Because there are so few examples to follow, Taschereau says, tests to ensure the hydrometallurgy worked had to be run carefully and repeatedly. But Canada December 2011 / January 2012 | 69

MINING AND METALS | ENERGY Conceptual and Feasibility Studies NI 43-101 Technical echnica Reports Mine Planning and Design Plant Design and Simulation Project Management EPCM Projects Commissioning Assistance Process Optimization and Control To join our our team team of ofexperts, ex experts, go to bba.ca/careers or LinkedIn.

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

precipitation raise the pH and remove iron and manganese impurities. Soda ash is then added and a third precipitation creates the end product: white, grainy lithium carbonate. Once bagged, it is ready to sell. All of this takes place in a few hours, according to Taschereau. “You can mine one day and have lithium carbonate the next,” he remarks. In contrast, it can take 18 months to three years to evaporate lithium from brine, depending on the area and conditions. “So they cannot react very quickly to changes in the market.” The downside, of course, is that the processing equipment is expensive. Building and equipping the processing plant contributed more than half of the project’s construction budget. Running it is expected to cost $1,914 per tonne of lithium carbonate, out of a total operating cost of $3,165 per tonne. But Taschereau points out that spodumene operations generate a level of purity that brine operations cannot hope to achieve. “The water contains lots of other things, and only a small part of the lithium makes it to the 99.5 per cent purity level necessary for batteries,” he says. “Our purity is much higher; we reach 99.9 per cent or even 99.96 per cent. That quality, right now, is not on the market, so it’s hard to put a dollar value to it. But all the battery makers we are talking to tell us that the major driver for the longevity of the battery is the quality of the lithium you use. So what we think is when we come to the market, there will be a premium for that higher-grade product.” At typical contract prices, a tonne of 99.5 per cent lithium carbonate fetches about US$6,000, according to Taschereau. The mine will produce 20,000 tonnes per year of lithium carbonate at that purity or better, which could make up as much as 12 per cent of the world market. Canada Lithium predicts average annual revenues of US$117 million and a capital payback time of four years.

Asia-bound Like all producers, Canada Lithium will have to find its own markets: there is no public exchange for lithium. Most of its clientele are anticipated to be battery makers in China, South Korea and Japan, and it has partnered with the Japanese metals trading firm Mitsui and Co. Ltd. to market the product in Asia. There are also two battery manufacturers in Quebec that could be possible customers, says Taschereau – one in production, and one still in construction. Although American auto and electronics manufacturers buy lithium batteries, there is only one major battery maker in the United States: A123 Systems. Most lithium batteries are imported from Asia, and Taschereau believes that will be the case for years to come. If Canada Lithium delivers the high-grade product its models predict, however, it will not need to rely on regional sales. Our collective love for cell phones, laptops, and other batteryoperated gadgets promises to fuel demand at a higher, and more sustainable, level than the Cold War ever did. CIM

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projet en vedette

Courtoisie de Canada Lithium Corp.

Remise en exploitation d’une mine de lithium

La propriété de Canada Lithium Corp. au Québec n’a pas été exploitée depuis presque 50 ans.

Quand la mine de lithium du Québec à Val-d’Or a été fermée en 1965 après 10 années d’exploitation, ses propriétaires croyaient qu’ils seraient de retour quelques mois plus tard pour la remettre en service. Ils se trompaient. Le commerce du lithium était resté actif tant que le gouvernement américain l’utilisait dans ses projets de recherche en matière de défense, mais à la suite de la réduction des achats de lithium par les États-Unis, la marge d’exploitation de la mine a disparu. Cependant, pendant la dernière décennie, on a commencé graduellement à utiliser les piles au lithium sur une grande échelle. En raison de la nouvelle demande d’appareils électroniques portables, le prix du lithium a pratiquement doublé et la production minière promet donc d’être de nouveau rentable. En 2008, le projet de Val-d’Or a été acquis par Canada Lithium Corp. qui projette la reprise de l’exploitation pour en retirer des gains substantiels. « Comme il y a déjà eu une mine dans le passé, nous disposons d’une énorme quantité d’informations », affirme Charles Taschereau, directeur de l’exploitation, Canada Lithium. La société avait 400 trous de forage et les dossiers des précédentes activités de traitement pour travailler. « Des chiffres récents communiqués par AMC Mining Consultants en juin 2011 indiquent des réserves prouvées et probables de 17,1 millions de tonnes de spodumène, contenant 0,94 pour cent de lithium, et des réserves mesurées et indiquées de 29,3 millions de tonnes. Les veines de minerai sont proches de la surface, ce qui nécessite très peu de travaux de prédécapage et permet d’envisager un plan d’exploitation à ciel ouvert pendant la durée de vie de la mine qui serait de 15 ans selon les prévisions actuelles. 72 | CIM Magazine | Vol. 6, No. 8

La documentation dont on dispose sur la propriété a été utile, mais l’infrastructure de l’ancienne mine a disparu. Même l’embranchement ferroviaire a été enlevé et devra être reconstruit. En octobre, Canada Lithium avait rassemblé environ les deux tiers du montant des coûts en immobilisations initiaux de 202 M$ US. La société prévoit mettre la mine en production vers la fin de 2012, la pleine production et les premières ventes devant avoir lieu en 2013. Bien que la construction ne commencera pas vraiment tant que les partenaires ne seront pas tous présents, Canada Lithium effectue des travaux élémentaires de préparation du site : construction d’une route d’accès, installation d’une ligne électrique provisoire et mise en place des structures initiales. La société a commandé à Metso de l’équipement d’usine à long délai de livraison et examine des offres portant sur de l’équipement plus spécialisé.

De bons voisins Les avantages que procure l’implantation d’une nouvelle mine sur le site d’une ancienne mine ne se limitent pas aux carottes de sondage et à la documentation. Canada Lithium peut voir ce qu’ont laissé les travaux de gestion des résidus et de restauration du site, et cela semble bénin. « Ce qui se rend dans les bassins de retenue, c’est 99 pour cent de silice », explique M. Taschereau. Le minerai ne contient pas de sulfure et les résidus sont un granite foncé, une roche très inerte. Les réactifs sont consommés pendant la phase de traitement. Les anciens bassins de stockage des résidus n’ont pas été construits selon les normes actuelles, mais on peut voir que les eaux tout autour sont poissonneuses et qu’aucun dommage n’a été causé à l’environnement. Et nos bassins de résidus seront beaucoup plus sécuritaires que cela. »

projet en vedette La mine est située à 60 kilomètres au nord de Val-d’Or, et M. Taschereau souligne que la société fait appel à des entrepreneurs de la région. « Nous avons plus de 12 entreprises qui travaillent actuellement sur le site, la plupart d’entre elles avec une ou deux pièces d’équipement. La principale raison en est que nous voulions nous assurer que l’activité économique demeure aussi locale que possible, mais je pense que finalement cela nous aide sans doute à obtenir de meilleurs prix et à mieux surveiller le travail. »

Dans le monde, les mines de lithium en roche dure sont rares. Le lithium se forme naturellement dans des bassins de saumure d’où il est extrait, à peu de coûts et en utilisant peu d’énergie, par pompage dans les bassins d’évaporation. Mais quand il apparaît dans la roche dure sous forme de minerai de spodumène (ou silicate d’aluminium et de lithium), le lithium peut être extrait au moyen de techniques utilisées habituellement pour l’extraction d’autres minerais. Selon M. Taschereau, comme on dispose de si peu d’exemples, des essais pour s’assurer que l’extraction par hydrométallurgie fonctionnait ont été réalisés avec soin et à plusieurs reprises. Mais Canada Lithium peut étudier les schémas de traitement de ses prédécesseurs. Finalement, la société n’a apporté que de légères modifications au procédé original. Tel que le projet est envisagé dans l’étude de faisabilité, le minerai, une fois extrait, sera transporté par camion à une usine de traitement. Après le premier broyage, il sera dirigé vers un trieur photométrique qui séparera la roche en fonction de la couleur. La roche stérile de granite foncé sera mise à part, alors que le spodumène de couleur pâle sera soumis à la suite du traitement. Le résultat de cette première valorisation devrait être un concentré de lithium à 6,5 pour cent. La société vendra sans doute une partie du concentré à des fabricants de verre et de céramique, mais le reste sera soumis à un second cycle de raffinage. À ce stade, le spodumène est d’abord chauffé dans un four afin de préparer sa structure pour la sulfatation. On ajoute alors de l’acide sulfurique et le sulfate de lithium qui est produit est dissout avec de l’eau. Deux phases de précipitation augmentent le pH et retirent les impuretés de fer et de manganèse. On ajoute ensuite du carbonate de sodium et une troisième precipitation crée le produit final : du carbonate de lithium granuleux de couleur blanche. Une fois mis en sac, il est prêt à être vendu. Tout ceci se fait en quelques heures, selon M. Taschereau. « Vous pouvez récupérer le carbonate de lithium un jour après avoir extrait le minerai », indique-t-il. En revanche, il faut de 18 mois à 3 ans selon la région et les conditions pour séparer le lithium de la saumure par évaporation. « Dans ce cas, il est impossible de réagir très rapidement aux variations du marché. »

Courtoisie de Canada Lithium Corp.

Saumure contre roche dure

Le projet est situé près de Val-d’Or, une communauté riche en expertise et en services miniers.

L’inconvénient, bien sûr, est que l’équipement de traitement du minerai coûte cher. La construction et l’équipement de l’usine de traitement ont représenté plus de la moitié du budget de construction de Québec Lithium. Son exploitation devrait coûter 1 914 $ par tonne de carbonate de lithium, sur un coût d’exploitation total de 3 165 $ par tonne. Aux prix habituels des contrats, une tonne de carbonate de lithium à 99,5 pour cent va chercher dans les 6 000 $ US, selon M. Taschereau. La mine produira 20 000 tonnes de carbonate de lithium par an présentant le même degré de pureté ou un degré supérieur, ce qui pourrait correspondre à autant que 12 pour cent du marché mondial. Canada Lithium prévoit en moyenne des produits d’exploitation annuels de 117 M$ US et une période de récupération du capital de quatre ans.

Regarder vers l’Asie Canada Lithium devra trouver ses propres marchés : il n’y a pas de marché public du lithium. On s’attend à ce que la clientèle soit constituée principalement de fabricants de piles. La société a établi un partenariat avec la société japonaise Mitsui and Co. Ltd. qui œuvre dans le commerce des métaux pour commercialiser le produit en Asie. Il y a aussi deux fabricants de piles au Québec susceptibles de devenir des clients, selon M. Taschereau. Bien que les constructeurs automobiles et les fabricants de matériel électronique des États-Unis achètent des piles au lithium, il n’existe qu’un seul grand fabricant de piles aux États-Unis : A123 Systems. La plupart des piles au lithium sont importées d’Asie et M. Taschereau croit qu’il en sera encore ainsi dans les années à venir. ICM December 2011 / January 2012 | 73

supply side | COLUMNS

What will 2012 hold for Canadaâ&#x20AC;&#x2122;s mining suppliers?

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

Jon Baird Forecasting is always precarious, particularly given current economic and political volatility. The truth is, no one knows if dark clouds will be rolling in for 2012, but there are subtle indicators as to what mining supply firms might expect in demand for their goods and services. At the time of writing this article, leadership in the United States is deadlocked and it seems difficult to expect much improvement in the market south of the border that takes some 75 per cent of Canadian exports. Even more serious is the situation in the Eurozone where the economic collapse of countries â&#x20AC;&#x201C; if not the Euro currency â&#x20AC;&#x201C; is predicted by some. Meanwhile, there are the high growth economies of India and China, as well as other Asian, Latin American and African countries. Developing countries that are urbanizing and expanding their middle classes are key to the growth in demand for mined commodities. The World Bank says that in 2000, developing countries were home to 56 per cent of the global middle class; by 2030, that figure is expected to reach 93 per cent. According to the International Monetary Fund, the share of emerging and developing economies in world GDP is expected to overtake advanced economies by 2014. More than shifting the flow of capital, this is also shifting in the way in which commodities move over borders. Thus, the mining industry could be sustained by the third world, even if Europe and North America falter.

Commodity prices are the barometer of the mining industry. The past 40 years have shown us that the commodity cycle is six to ten years. When prices rise, exploration is stimulated, discoveries are made, mines are constructed and then go into operation, and existing operations are expanded. This part of the cycle is wonderful for suppliers to the mining industry. However, when commodity prices fall, exploration is curtailed, mines cut production and some close. This part of the cycle is clearly not good for mining suppliers, and much of what will happen to mining suppliers in 2012 will depend on commodity prices. IndexMundi (www.indexmundi.com) offers a Commodity Metals Price Index, with 2005 = 100, which includes a basket of copper, aluminum, iron ore, tin, nickel, zinc, lead and uranium price indices. This index stayed below 100 from 1981 to late 2005. From then it took off, doubling in 2007 and remaining high until mid2008. In the spring of 2009, it crashed, returning to about 100. After that, it rose steadily, hitting 250 in April 2011. From April to September 2011, the index dropped to 225. Gold is another matter. It is a key commodity for companies providing goods and services to the exploration industry, since 50 per cent of world investment in mineral exploration is focused on the yellow metal. From 1980 to 2004, gold remained under US$450 per ounce, after which the

MOVING ON UP Ann Marie Hann became the new president of the Coal Association of Canada. She made the switch after a career in government service and at the Propane Gas Association of Canada.

price soared, rising to nearly US$2,000 before settling back recently. On the supply side, high commodity prices allow mining of lower grades. However, the rock outcrops of the world have been well prospected, so new discoveries will be harder to make as they will be hidden under cover or at depth. Further, the permitting of new mines is becoming more difficult and expensive. It is doubtful, therefore, that major increases in supply will overcome demand increases, thus forcing prices down. So, what is the forecast? Barring a major catastrophe like the credit crisis and recession of 2008 and 2009, we are in a new era of economic expansion, led by the developing world, that will keep mined commodity prices at high levels, which, despite increasing costs, will keep mining companies profitable and continuing their quest for new resources. Thus, based on commodity prices, the forecast is for relative stability over 2012 for the mining industry and its suppliers, even if the economic news in developed countries is disappointing. If, however, the world economy does run into a major crisis, it is to be expected that mined commodity producers may suffer less than other industrial sectors. Even if there is a plunge in commodity prices as there was in 2008, the downturn should be as short-lived as it was then, because prices will be supported by demand from emerging economies. CIM

author

Jon Baird, managing director of CAMESE and the immediate past president of PDAC, is interested in collective approaches to enhancing the Canadian brand in the world of mining. December 2011 / January 2012 | 75

COLUMNS

| MAC economic commentary

The mining industry’s international trade and investment priorities Paul Stothart There are few industry sectors in Canada as internationally active as the mining industry. This can be seen through several measures. Canadian companies are global traders with multibillion dollar exports in many areas. The Canadian mining industry exported $85 billion worth of minerals in 2010, a figure that equates to 21 per cent of all Canadian goods exported. Key products included aluminum, copper, gold, iron ore, nickel, silver, uranium, zinc, diamonds, potash, coal, and iron and steel, which ranged from $1.7 billion to $15 billion each. The industry also has significant imports and, overall, contributes around 50 per cent of the freight revenue of Canada’s railways. The mining industry also accesses new capital, ideas and opportunities through high flows of outward and inward investment. Total Canadian direct investment abroad (CDIA) was valued at $617 billion in 2010. The minerals and metal products sector accounted for $58

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

billion, or 9.4 per cent of this figure; it has held steady at approximately 10 per cent over the past decade. The total stock of foreign direct investment in Canada (FDIC) in the sector grew dramatically in 2007 and remains in the $60 billion range. This represents 10.3 per cent of total FDIC stocks in Canada, up from the five to seven per cent range of previous decades, reflecting the foreign acquisitions that occurred in Canada’s minerals and metals sector in recent years. In the financial services sphere, Canadian stock exchanges have provided 36 per cent of the world’s mining equity and handled 83 per cent of the world’s mining financing transactions over the past five years. There are many Canadian consultants, analysts, accountants and lawyers who have developed global expertise in the mining finance area. Finally, through the existence of supportive public policies, among other variables, Canada has built an impressive global base of expertise in mineral exploration in recent decades. There are an estimated 1,000 Canadian exploration companies active in other countries. Companies listed on the Toronto Stock Exchange have over 5,100 mineral projects in varying stages of development outside Canada and the vast majority of these are exploration projects. While much of this international activity is based upon the principle of comparative advantage, with companies following their relative strengths, there is a role for supportive long-term public policy to help build the most competitive domestic investment regime. There is also a role for Canadian international trade and investment policy, to support Canada’s business involvement and interests in foreign countries. While not drawing upon any detailed input from industry, my sense is that the following three measures rank as the most potentially useful government trade and investment pursuits for the mining industry over the coming years. 1. Canada and India launched negotiations in November 2010 towards establishing a Comprehensive Economic Partnership Agreement and have completed three rounds of talks thus far. The intent is to complete negotiations by 2013. This initiative offers the greatest potential of all for the Canadian mining industry, given the size and projected growth rates of India’s economy. The insular nature of India’s economy further reinforces the value of these negotiations. Of note, only three of the aforementioned 5,100 international projects are in India, which speaks to the highly protective nature of India’s trade and invest-

MAC economic commentary | COLUMNS ment policies. An economic partnership would also bring greater transparency to India’s business processes and, over time, help to reduce corruption. 2. Canada and China began discussions on a foreign investment protection agreement during the Ming Dynasty and have since completed over a dozen rounds of negotiations! While this timetable may be a subject for ridicule, there are signs that closure could be brought to an actual agreement over the coming years. China has become an active foreign investor in recent years and holds $3 trillion in foreign exchange reserves, much of which it seeks to invest in hard assets. The country also requires the products and expertise that Canadian mining firms can offer in mineral processing, safety, efficiency and related areas. Agreeing on investment obligations pertaining to national treatment, transparency, transfers, and expropriation and investor-state provisions would represent a positive development for both countries and enhance business prospects for Canadian mining companies. 3. Canada and the European Union (EU) announced the launch of discussions in May 2009 towards a comprehensive economic agreement and have proceeded on an ambitious timetable. Nine rounds of talks had taken place as of October 2011 and negotiators are aiming for a targeted two-year completion timeframe. A background study estimated that trade liberalization could increase Canada-EU bilateral trade by 20 per cent. While other sectors such as food and agriculture would be more directly affected by an agreement, it is likely that an EU-wide investment protection provision would facilitate Canadian investment in mining opportunities that may exist, particularly in Eastern Europe. Beyond these three priorities, Canada is also in varying phases of negotiation regarding potential or strengthened foreign investment protection agreements with Tanzania, Madagascar, Mali, Mongolia, Indonesia and Vietnam, among others. Moving these to completion would help support Canadian mining investment and expertise, particularly in Africa and Asia. CIM

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

GIVING BACK

The Mining Association of Canada made a $2,500 contribution to the National Aboriginal Achievement Foundation (NAAF) during its annual Mining Day on the Hill event. This builds upon the $25,000 contribution made earlier this year, for a total of $27,500. *** Mining magnate Seymour Schulich has announced a gift of $100 million – the second largest endowment in Canadian academia in history – to create the Schulich Leaders Scholarship program. He hopes it will be the Canadian equivalent of the Rhodes Scholarship. When fully implemented by 2014, the award will grant $60,000 over four years to students enrolling in science, technology, engineering or mathematics programs. *** De Beers Canada and the Hay River Hospital Foundation have unveiled equipment purchased for the Hay River Health and Social Services Authority (HRHSSA), thanks to funds raised at this year’s De Beers Canada Charity Classic Golf Tournament. The fourth annual tournament, held in July, raised a record $50,900, raising the total generated for the Hay River Hospital Foundation and Hay River Golf to about $140,000 over four years.

December 2011 / January 2012 | 77

COLUMNS

| HR outlook

Full steam ahead MiHR Council prepares for the coming year

The past year has marked an exciting time for the Mining Industry Human Resources Council (MiHR) and for Canada’s mining industry. Beginning in January, the Council hosted a series of events to recognize the inaugural group of nationally certified underground miners, surface miners and mineral processing operators through MiHR’s Canadian Mining Credentials Program, culminating in a national event at the CIM Conference & Exhibition in May to celebrate this MiHR’s recent studies on highly qualified people and exploration provide insight into sector-specific occupations and workforce milestone accomplishment segments not previously studied from a mining perspective. for Canadian miners. Unlike the trades, skilled workers in It was an evening of pride, celebra- continue to define the Council’s activities as we look forward to 2012 and these occupations have never before tion and partnership with growing been awarded an industry-recognized excitement for the future expansion the national launch of the program, credential that supports mobility and of the program, which carried making certification a reality for mining workers across Canada. retention within the mining work- throughout the remainder of the year. This milestone accomplishment will force.

An evolving relationship with government

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

The New Year will bring about some changes at MiHR. The results of the federal government’s strategic review of the Sector Council Program will see “core funding” to all sector councils phased out by 2013. In the same announcement, high-level details were given of a new project fund that focuses on labour market information, national occupational standards and certification programs. So what does this mean for MiHR? Although these changes will have an impact on MiHR, the Council has a growing diversified funding base and is strategically positioned to serve the mining industry in addressing its human resources challenges. Over the next six months, in consultation with industry stakeholders, we will continue

MiHR

Ryan Montpellier

HR outlook | COLUMNS

to review our strategic plan to ensure our programs and projects are sustainable and remain relevant and effective. Additionally, the new funding program announced by the federal government aligns with MiHR’s priorities: national occupational standards; Canadian mining certification/accreditation; and the provision of labour market information.

What MiHR will bring to stakeholders in 2012 In addition to the national launch of our worker certification program, MiHR will continue to focus on its Research for Industry Sustainability priority, to provide industry with the most up-to-date labour market information. To this end, MiHR will refine and develop the model used for the forecasts in its annual outlook reports: Canadian Mining Industry Employment and Hiring Forecasts. One of the major additions will be the incorporation of a talent-availability (or labour supply) forecast which will provide a more complete picture of the mining labour market. This will allow MiHR to analyze the gaps in the mining industry’s labour market and highlight approaches that may be taken to address these gaps. The Council has also recently published two sector studies on highly qualified people and mineral exploration that provide valuable insight into sector-specific occupations and workforce segments that have not previously been studied from a mining industry perspective. As a result of these studies, Making the Grade: Human Resources Challenges and Opportunities for Knowledge Workers in Canadian Mining and Unearthing Possibilities: Human Resources Challenges and Opportunities in the Canadian Mineral Exploration Sector, MiHR is exploring the possibility of further research into HR management in micro- and smallenterprises. The organization hopes to better understand HR needs and create a hub to facilitate collaborative

HR management efforts between smaller companies. MiHR will also be focusing on expanding the scope of its research initiatives to offer more custom labour market research to meet the needs of its stakeholders. The Council’s previous custom research publications have included provincial reports for British Columbia, Saskatchewan, Ontario and, most recently, the Saskatchewan Mining Industry Hiring Requirements and Talent Availability Forecasts 2011, which was published in partnership with the Saskatchewan Mining Association. Another exciting development for the Council in 2012 is the launch of Mining Essentials: A Work Readiness Training Program for Aboriginal Peoples. The program, which helps companies and communities meet joint hiring and employment targets, was piloted beginning last fall at Anishinabek Employment and Training Services (AETS) in Thunder Bay, Ontario, Northwest Community College in Hazelton, British Columbia, and Anishinaabeg of Kabapikotawangag Resource Council in Kenora, Ontario.

Mining Essentials teaches industryvalidated essential, non-technical skills and knowledge the mining industry requires for an individual to be considered for an entry-level position. It is currently being delivered at Northern College in Timmins, Ontario, in partnership with the Wabun Tribal Council and Detour Gold. MiHR and the Assembly of First Nations are now looking to identify more qualified training partners and sites to increase opportunities to deliver Mining Essentials across Canada, launching in January 2012. The New Year will bring about new partnerships and challenges for our industry. With increased media attention putting the mining skills shortage in the spotlight, MiHR will continue to mobilize our industry partners across Canada to work collaboratively as we move forward with our new strategic plan. CIM

author

Ryan Montpellier is the executive director of MiHR. Currently, he sits on a number of boards and provincial committees dealing with labour shortages in the mining sector.

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December 2011 / January 2012 | 79

COLUMNS

| eye on business

Protecting the family jewels African governments likely to increase benefits from resources in 2012 R. B. Phiri and D. Cavvadas The resource sector’s relatively quick recovery from the 2008 global financial crisis and the anticipated boom in resources are prompting African governments to find ways to distribute mining profits to the general population. These initiatives reflect the widespread view across the continent that the local people must benefit from any future resource sector activity. The pressure for local gain is particularly strong now that government budgets have been squeezed by the global recession and aid payments have been cut back by cashstrapped Western donors. There are indications that 2012 will bring a shift in attitudes and African governments may look to revise tax regimes, royalty regimes, and joint venture and equity ownership arrangements to restore treasury conditions. A case in point is the government of Guinea, which passed legislation earlier this year allowing the state a free carry interest of 15 per cent in all new mining projects, with a right to purchase a further 20 per cent interest. Newly elected president Alpha Condé has also announced that he wants a 33 per cent “blocking minority” state ownership in all mining projects. These measures are being introduced by the Guinean government in an effort to increase benefits of being the world’s largest supplier of bauxite. Taking a different approach, but with similar aims of increasing economic benefit, lawmakers in Tanzania have approved a US$27.4 billion economic development plan (EDP), which proposes the imposition of a levy on so-called “super profits” from mining to help fund the EDP. However, the government has moved to assure markets that the tax will not be implemented unless it is justified by economic conditions. Tanzania is Africa’s third largest gold producer. If the price of gold remains high, Tanzania looks set to be rewarded handsomely from the imposition of this proposed levy. Nigeria appears ready to dust the cobwebs off its Petroleum Industry Bill (PIB) that has languished in the National Assembly since 2009. The PIB seeks to fundamentally reform the oil and gas sector to benefit Nigerians. It replaces the current standard royalty of 20 per cent for onshore and 18.5 per cent for swamp/shallow water operations, with a 25 to 50 per cent sliding scale. It also contains new taxes, namely a hydrocarbon tax, 30 per cent company income tax, Niger Delta Development Commission levy rent on acreages, education tax and penalty for flared gas. The government of Namibia will be looking to increase the participation of Epangelo Mining, the newly created state-owned mining company, in the sector. The country’s Minister of Mines and Energy, Isak Katali, told Parliament in April that the Namibian government would give Epangelo Mining exclusive rights to all mining and exploration of strategic minerals. These include uranium, gold, diamonds, 80 | CIM Magazine | Vol. 6, No. 8

copper, coal, rare earths and zinc. The minister has, however, indicated that this would not impact existing exploration and mining rights. Namibia is the world’s fourth-largest uranium producer. This is just a short list of the many proposed changes within Africa aimed at giving governments greater access to minerals and the wealth derived from them. Such a list would not be complete without a mention of Africa’s largest economy, South Africa, and its neighbour, Zimbabwe. Over the past few months, the Zimbabwean government has blatantly stepped up the implementation of its indigenization policy that calls for the transfer of 51 per cent of all foreignowned mining properties to indigenous Zimbabweans, including the government, which will likely pursue these measures with greater enthusiasm during 2012. The outcome of negotiations between the government and miners over the coming year is also highly anticipated. In South Africa, the jury is out on the direction the country will take. All eyes will be on the outcome of the ruling political party’s elective conference in 2012, wherein the party is expected to discuss the possible nationalization of strategic sectors of the economy, including the resource sector. There is uncertainty as to the form that this nationalization may take and its potential impact on the resource sector. Still, this trend towards resource nationalism does not suggest a regression by African governments to the rampant nationalization of mines of 20 years ago. It appears that measures will be largely aimed at boosting the state’s share of joint ventures, increasing royalties and reducing fiscal concessions. It also does not appear that many of these measures will be retrospective. Mining companies doing business in Africa and seeking to ease their exposure to resource nationalism should make better use of existing national legislation, development and investment agreements, state agreements and bilateral investment treaties. They should also look more closely at the ambit of clauses dealing with hardship, political force majeure, expropriation, political risk insurance and stability in their arrangements with African governments. CIM

authorS Reitumetse Benedict (Ben) Phiri is an associate with Fasken Martineau in Johannesburg. His practice spans mergers and acquisitions, joint ventures, asset and business acquisitions and disposals, and loans and financings. Dimitri Cavvadas is a partner with Fasken Martineau in Johannesburg. His commercial law practice focuses on mergers and acquisitions and capital market transactions within the resource sector.

COLUMNS

| student life

Students in mining: how to attract the best and brightest As the mining industry evolves, so does the employment rate, calling for a higher demand of summer interns and new graduates. Students are always looking for ways to stand out and get companies to take notice. Countless hours go into filling out resumes and applications in hopes of landing that coveted interview and, ultimately, a job. On the other end of the spectrum, companies are in need of students, so what should they be doing to recruit the best and brightest? Companies must maximize their exposure to Career fairs are an effective way of reaching the next generation of professionals. maximize their reach. One of the most effective means of reaching us is through career fairs – So what do students want to know? sites, such as Facebook and Twitter, is often held at universities and colleges Giving basic, yet thorough, informaalso a great way to fill us in on news – at which companies host seminars tion about the company’s mission, as and important deadlines. promoting the advantages of working Overall, companies and students well as a complete job description, will for them. Typically, students are more share the same need: finding the right attract more serious candidates. Hav“fit.” As many industries are dealing inclined to participate in on-campus ing testimonials on hand from previwith a growing HR crisis, a plethora of events than travel to an off-site venue. ous student interns is also useful when opportunities will become available to Open and honest communication is recruiting; reading about our counterstudents. Mining companies will need a key component when recruiting. parts’ past experiences will help us in to go the extra mile to ensure they are Often, the very thing a company is making informed decisions. Students attracting the best students. I believe it also want to know where a position looking for in a student is what a stucan be achieved by making an effort to may lead, as it helps plan for the long dent is looking for in a company. We understand the needs and preferences term and set personal goals. Explainlike career fairs because they are more ing the benefits of working for your of the next generation of professionals effective than an impersonal pamphlet company is intriguing, especially those and connecting with us through effecor corporate cheat sheet. Being able to related to work-life balance, as this is tive channels. CIM speak one-on-one to a representative something that is important to most gives us students an idea of where we students who are transitioning into the might fit within an organization. We working world. need to see ourselves in a position and What comes after the fair is over? we want to know who we will be Rebecca Tottle is a Staying connected. Sending us news working for. For example, companies second-year mining about the company – such as new using the latest technology are engineering student projects or progress reports of current extremely appealing to us, as are at Queen’s University. projects – keeps us up to date about organizations that operate in an enviwhat is happening at your organizaronmentally, socially and economically tion. Using social networking webresponsible way.

author

December 2011 / January 2012 | 81

Courtesy of the Mining Department at Queen’s University

Rebecca Tottle

COLUMNS

| standards

Best practice guidelines for mineral processing now available D. Fragomeni, L. Urbanoski, T. Lipiec and C. Fleming National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101) is a set of rules and guidelines for reporting and displaying technical information related to mineral projects owned or explored by mining companies that report these results to the Canadian public. This includes foreign mining companies that trade on Canadian stock exchanges and private mining companies that make technical information available to the public. On June 30, 2011, NI 43-101 was updated by the Canadian Securities Administrators (CSA), and this past August, CIM Council approved the final version of the highly anticipated Best Practice Guidelines for Mineral Processing (BPGMP). NI 43-101 has specific rules regarding technical information that requires the consideration of metallurgy and mineral processing. A mineral resource estimator requires input regarding metallurgy for the appropriate assumptions used in determining a mineral resource, and metallurgists or process engineers should always be involved in the technical considerations applied to mineral reserves. In addition, several items in a technical report require particular information and discussion related to metallurgy and mineral processing, including Item 13 (Mineral Processing and Metallurgical Testing) and Item 17 (Recovery Methods). In 2010, during the 42nd Annual National Meeting of the Canadian Mineral Processors Society of CIM (CMP), a motion from the floor was passed requesting that CMP perform a review of the mineral processing components of NI 43-101 and produce recommendations or best practice guidelines. A subcommittee representing the main interest groups â&#x20AC;&#x201C; operations, engineering and testing laboratories â&#x20AC;&#x201C; was formed, which included: Larry Urbanoski, independent consulting 82 | CIM Magazine | Vol. 6, No. 8

metallurgical engineer, LSU Consulting; Tony Lipiec, principal process engineer, AMEC; and Chris Fleming, senior metallurgical consultant, SGS Lakefield Research. The goal of the revision was to produce workable, practical and nonprescriptive best practice guidelines (BPG) by compiling industry best practices. At the same time, it needed to maintain the flexibility for the Qualified Person (QP) to determine what best fits the company and project risk profile while maintaining overall accountability. The subcommittee worked diligently to produce a draft by the fall of 2010. Then-CIM president Michael Allan and CIM president-elect Chuck Edwards were instrumental in soliciting CIM resources currently engaged in the overall review of NI 43-101, including Robert Holland and Neil Gow, to provide support for the process. In addition to the Best Practice Guidelines, an appendix was produced that describes support for the guidelines in tabular form. A summary table indicates the level of support work for the technical report expected from the studies, with specific reference to the project stages: scoping, prefeasibility and feasibility. In addition, a muchneeded glossary of terms was included to define certain mineral processing

jargon. The BPGMP boundary limits are defined from mill feed to concentrate or bullion and tailings. Guidelines on the assessment of smelting or hydrometallurgical processes are not considered. Through a consultative process, the CMP subcommittee met its objectives of a workable, practical and nonprescriptive set of best practice guidelines for the testing and evaluation of mineral resources related to the ore beneficiation process. Guidelines on sample selection, grindability testing, recovery processes and even reference to assessment of environmental consideration from ore to concentrate or bullion have been included. The BPGMP is a reference for process engineers acting as QPs involved in producing NI 43-101 technical reports. It provides an indication of the work required in the design of beneficiation processes at various project stages, in order to support the declaration of resources and reserves. The guidelines also allow for the assessment of risk by the QP and selection of sampling, testing and design requirements based on company and deposit risk profile. The BPGMP, appendix and glossary of terms can be found at www.cim.org/standards. CIM

authorS Dominic Fragomeni is a director of Xstrata Process Support. He is frequently involved in mineral processing flowsheet development in base metals and gold, and has a background in plant operations management and metallurgical support. Larry Urbanoski is an independent consulting metallurgical engineer with a background in mineral processing related to concentrator operations, mineral project evaluation and development programs. Tony Lipiec is a principal process engineer at AMEC with a background in base and precious metals processing. He is frequently involved in the preparation of NI 43-101 technical reports. Chris Fleming is a retired SGS Lakefield Research executive and is now a senior metallurgical consultant with SGS. He is a specialist in hydrometallurgy and gold processing technologies.

canadians abroad | COLUMNS

Treading new territory A Canadian company’s foray onto the international scene Heather Ednie

Carlos Grimaldi (front), general manager - Central America, and Bob Wallis (back), senior vice-president, Kal Tire Mining Tire Group, at the Fresnillo mine site in Mexico. Fresnillo is the world's largest primary silver producer and the second largest gold producer in Mexico.

Kal Tire archive

Creating a hybrid culture has been the foundation of Kal Tire’s successful emergence on the international market. A family-owned company based in Vernon, British Columbia, Kal Tire was formed in 1953 and has since developed a strong reputation in Canada as a solutions supplier of tire services. However, the urge to venture outside Canadian borders grew and, in 1997, the company made the leap onto the international scene, following customer demand all the way to Chile.

Expanding outside the comfort zone Establishing the company as a viable supplier to the Chilean mining industry was a slow process. “We were committed to the venture, but it was very hard work,” says Chris Brothen, international development and sales, Mining Tire Group, Kal Tire. “We had a good reputation in Canada but in Chile, we found out your name doesn’t always precede you.” Kal Tire persevered and found success in Chile. For Brothen, expanding into new territories brought exciting challenges. “Wherever you go, there’s a whole new set of rules to follow – a new culture, language, customs and competition to face,” he says. “You can’t change your core business – that’s why you’re there.”

To Chile, and beyond South America has proven to be a land of great potential for Kal Tire. In 2003, it moved into Argentina and had to adapt and strategize business plans once again. “We were somewhat road-hardened, but again, we faced another complete set of rules and regulations for setting up a business,” says Brothen. “Even though you have a similar language, or what you may assume to be cultural similarities, it is quite different. You have to learn to

migrate through the bureaucracy to get where you want to go.” In 2005, the company purchased a majority position in Multillantas Grimaldi, a seasoned family-owned business operating in Mexico. “We entered that marketplace by buying a Mexican company that was already established and running, and that had a very good reputation,” Brothen explains. “It offered the same services as Kal Tire, so the purchase provided the opportunity to blend corporate cultures, creating a hybrid culture enabling growth.” From there, Kal Tire expanded into Central America – to Panama – and then to Colombia. Hot off the heels of a successful foray into Latin America, Kal Tire shifted its focus across the pond to Nottingham, England, purchasing OTR Tyre in 2009. “Their company was in a position of growth, so we went along with them,” Brothen recalls. “They brought us into England, Africa (Egypt, Ghana, Tansania, South Africa), Norway and Australia – it’s just been tremendous. We grew stronger as a company, due to their knowledge, and then grew even more, due to our ability to share that knowledge and customer base throughout our global network.”

Creating a hybrid Early on, Kal Tire adopted a process of self-evaluation to ensure it was setting best practices and sharing them throughout the company’s global network. Kal Tire also made a crucial – and perhaps its smartest – business decision when it decided to place its international operations in the hands of those who are indigenous to the area. “In Chile, for example, the company may have the name Kal Tire, but it is run by a Chilean, which is as it should be to be a part of the Chilean industry,” Brothen says. “We don’t have a large contingent of expats in our companies around the world. Although we will hopefully add some Canadian concepts to each operation, we’re not out to force our values onto each other.” Those who have merged with Kal Tire have benefited from its access to global expertise, while still maintaining control of local operations. “Our global expansion has been a story of peers coming together,” Brothen adds. “That unity provides tremendous strength that we couldn’t even calculate going in.” Looking back, Brothen has only one regret: “If we could have, we would have gone global a lot sooner.” CIM December 2011 / January 2012 | 83

COLUMNS

| canadians abroad

Adventures in paradise A nickel company’s number cruncher trades his Montreal office for a life in the South Pacific

Life is good for Pierre-André Viens, senior business analyst for Xstrata Nickel’s mining project in New Caledonia. As a Canadian, it is hard not to smile when you wake up on winter mornings to the swaying of palm trees outside your window. The mining industry often requires its workers to relocate to remote and sometimes less attractive areas, but once in a while, you might get lucky like Viens, and find your project situated near turquoise water. “It’s the South Pacific paradise you see in the movies,” he says. “I live in a small house with a beautiful tropical garden where I grow coconuts, bananas and papayas.” Located in the Western Pacific Ocean, 1,500 kilometres east of Australia, New Caledonia has a population of about 250,000; nickel is the economic lifeblood of this French territory. Nicknamed “le caillou” (the rock), the ore there has been mined since the late 19th century and the Melanesian island group sits on an estimated 25 per cent of the world’s nickel resources. Xstrata Nickel has partnered with Société Minière du Sud Pacific (SMSP), New Caledonia’s North Province financial arm, to develop the massive Koniambo ore body on Grande Terre, the main island. The Toronto-based company holds a 49 per cent stake in Koniambo Nickel SAS; the remaining 51 per cent share is owned by SMSP. “Koniambo is a huge, long-life project with an open pit mine, a metallurgical plant and associated infrastructure, including a power station,” says Viens. “I conduct the business analysis and the economic models for the venture.” Viens says his job is challenging, but he feels good about the work he is doing. “What makes Koniambo extra 84 | CIM Magazine | Vol. 6, No. 8

Courtesy of Christian Gangloff

Richard Andrews

Viens takes off for Coeur de Voh from the Koné airport.

special is the support we get from the local populations,” he adds. “The plan to build a nickel processing factory in the North Province has been supported by elected representatives, provincial administrators and the local communities in an effort to support and implement the economic rebalancing written into the Matignon and Nouméa Accords.” In fact, last year alone, about 4,000 people (mostly from the North Province) came to the site to see how it was progressing. “One of the main goals is to distribute the benefits of the project and raise the level of income of the people in the North Province,” he explains. “Enhancing wealth for the indigenous people is considered to be very important.” Despite its attractions, Viens’ move from Montreal to Koné two years ago came with an initial culture shock. It was a far cry from his life of working in a Canadian industrial park, with completely different weather, landscapes and pace of life. But the locals were welcoming, and saying yes to the opportunity to work on an international

operation quickly proved to be the right choice. As well as a significant career move, the posting has changed Viens’ personal life. He makes the most of the island’s recreational opportunities and often jokes that he feels as though he lives in a resort. “I got my scuba diving certificate a while ago and can now explore one of the best coral reefs in the world,” he says. “Then I thought, why stop there? So I got my pilot’s license to fly ultra light aircraft as well. It’s fantastic to soar the skies over lagoons, mountain ranges, atolls and rainforests.” Nevertheless, Viens admits that he sometimes gets homesick and misses his family and friends, so he makes a point of returning to Canada for Christmas. “I’m happy to come home, but I have to say, I’m ready to leave for the tropics again after a couple of weeks of a Quebec winter,” Viens laughs. “I don’t mind the thought of a few more years of white sands and palm trees, without shoveling snow, icy roads and wearing multiple layers of clothing.” CIM

COLUMNS

| safety

Room for improvement Survey targets rough patches on the road to safety performance Heather Ednie

Helicopter slinging operation in northwestern British Columbia

The sixth edition of the Canadian Mineral Exploration Health and Safety Annual Report, to be released this winter, may unlock some of the secrets to creating safer work environments. The report will focus on the Canadian exploration industry and identify key trends and areas for improvement. Born of a partnership between the Association for Mineral Exploration British Columbia (AME BC) and the Prospectors and Developers Association of Canada (PDAC), the report will give companies factual information on which to build workplace guidelines. AME BC has an extensive history of surveying performance and striving for improved safety at exploration sites in British Columbia. “The annual report created from the safety survey complements the other efforts of the AME BC Health and Safety Committee,” says Gavin C. Dirom, president and CEO, of AME BC. “The information and lessons learned that are contained in the report can translate into modifying behaviours and developing new tools for companies to improve their safety records. With the results from the annual safety survey, we have real, factual information to act upon. We can then work with government 86 | CIM Magazine | Vol. 6, No. 8

Slip/fall Drilling machinery related Tool use Improper lifting Object related Improper operation Automobile Falling object Snowmobile ATV Field work Animal Medical Chemical Vehicle – other Weather Helicopter Camp equipment related Airplane

22 19 15 15 9 7 6 6 4 4 4 3 3 3 2 2 1 1

and industry to improve guidelines, modify regulations, promote best practices or even stop activities that are identified as being unsafe.” Lena Brommeland, executive vicepresident, project services, at Hunter Dickinson, sits on the PDAC Health and Safety Committee and says the study report is a helpful resource in her company’s continuous efforts to improve safety performance. With each report, she and her team read through the incidents, seeking out trends and useful information. “We use it as a source to identify areas we can improve, and we act upon it,” she says. According to the results of the survey in the 2009 Annual Report, three main trends continue to be the major safety challenges for the Canadian exploration industry: • Slips, trips and falls are the number one cause of incidents. • Airborne (specifically helicopter) accidents are the primary cause of fatalities. • A high incident rate centres around diamond drilling activities. Information like this helps the industry take action. “For example, we’re working jointly with government agencies and industry to identify

Number of incidents

measures to address the significant issue of helicopter-related fatalities in our sector,” Dirom says. “With concrete information to build upon, we can work with other organizations to determine what can be done.” However, the exploration industry still has a way to go to realize its potential safety record. Not everyone is committed to safety, which is evidenced by the number of respondents to the survey. “Yes, we’ve seen year-onyear growth in our respondents, which is positive,” Brommeland says. “We had 349 last year. But considering that here in Vancouver there are 800 exploration companies operating within a six-block radius and that on the TSX there are over 1,200 exploration companies listed, there are a lot of companies not participating in this survey.” Despite the rate of respondents, there is strong support for creating a culture of safety and encouraging leadership throughout the exploration industry. “Through the sharing of information and addressing the issues head-on, we can make substantial improvements in safety,” Dirom adds. “It is a proactive approach to preventing actual incidents and the near hits of the future from occurring in the first place.” CIM

Source: AME BC/PDAC

Kim Fisher/AME BC

Incidents by cause at mineral exploration sites in Canada in 2009.

aboriginal perspectives | COLUMNS

Banding together for a better future Ring of Fire First Nations sign Unity Declaration Alexandra Lopez-Pacheco

Matawa First Nations Management

The Ring of Fire region in own studies because these projects Ontario has attracted interest can potentially have a long-term from almost 100 mining comimpact on the land.” panies in recent years, many of Twice last year, Matawa First whom are interested in its sigNations requested funding from nificant deposits of chromite, a the Ontario government to help key mineral in the making of them conduct their own studies stainless steel. and prepare for discussions about The area is also home to mining developments. “The First numerous Aboriginal commuNations have a right to conduct nities that are interested in studies so we can engage in enviexploring the potential of their ronmental assessment and negotiland on one condition: that ations, but so far that has not Chief Sonny Gagnon of Aroland First Nation announces the Matawa Chiefs they can be involved in the Judicial Review filing at a joint media conference at the Canadian happened,” says Raymond Ferris, process. Unfortunately, recent Parliamentary Press Gallery in Ottawa, Ontario on November 7, 2011. Matawa First Nations Ring of Fire talks between Chiefs and the coordinator. “The government is Canadian Environmental Assessment sees this as a crucial moment in time basically saying: trust us, we’ll do all the Agency (CEAA) broke down after for the future of his people. “This is the studies and processes, and everything First Nations’ efforts to obtain a Joint biggest opportunity we have had to will be fine. But we don’t want that. We Review Panel Environmental Assessmake our communities prosperous and want consultation protocols, to prepare ment proved to be unsuccessful. self-sufficient,” he says. “I can be for negotiations and have the funding The CEAA elected to conduct what greedy today and sign any contract to conduct our due diligence. The is called a “comprehensive study,” with a mining company, but I’m thinkprovince hasn’t provided anything so which has a one-year timeline and ing about future generations – my peofar other than small, insufficient relies heavily on reports, studies and ple – I want to protect them.” Gagnon’s amounts that are all conditional.” written submissions rather than a Northern Ontario community of some Gagnon believes there is not an adereview panel process, which is open- 600 people has a 99 per cent unemquate level of trust in the government’s ended and involves more community ployment rate. “I want my community environmental studies. “We’re saying: discussion and debate. to be self-sustaining,” he says, “and get come and talk to us, but give us the A group of nine Northern Ontario off this ‘Indian Affairs’ mode we’ve resources so we can talk to you and First Nations are going to Federal been in for so many years.” understand what you’re saying,” he Court in an effort to get the governHe recalls family members who says. “I don’t speak the mining lanment to hear them out. They want a were displaced from their land by two guage – it’s new to me. If we all talked joint review panel to be reconsidered companies back in the 1930s. “We Ojibway to them, do you know how and they are aiming for a beefed up were very nomadic people at the time,” fast they’d get the money to translate? environmental assessment of a prohe says. “The bulldozers came and my We should have been consulted from posed chromite mine near Thunder relatives were forced to move. Then day one. As the Chief of my commuBay, complete with public consultalater, another mine popped up in our nity, I’m saying give us that chance. Listions in affected communities. backyard and two families were forced ten to us. I would have been working The nine First Nations have signed to leave without compensation.” hand in hand with industry and the the Mamow-Wecheekapawetahteewiin Gagnon says that to date, the mining government if that had happened.” (or Unity Declaration), which states companies have not consulted the comFerris echoes Chief Gagnon’s mesthey will stand together to ensure their munities, but he hopes that this will sage. “The companies that have subnation is protected and that their writchange now that they are presenting a mitted their project descriptions realize ten consent will be required before any united front. “Our input could be posinow that in order to get the permits development activity may proceed. tive,” he says. “We want development they require, they have to go through Chief Sonny Gagnon of the Aroland and we want to partner, but this can’t the First Nations. The relationship First Nations – one of the communities happen because we don’t have the building should have started from the that form the Matawa First Nations – proper resources. We need to do our beginning.” CIM December 2011 / January 2012 | 87

COLUMNS

| innovation

Where no man has gone before A new research project on the horizon for CMIC

Muon tomography is a technology using highenergy muons from cosmic rays. The study of its potential application to mining and exploration is fairly new. Since 2005, Douglas Bryman, a professor in the Department of Physics and Astronomy at the University of British Columbia (UBC), has been investigating this application in exploring for high-density mineral deposits deep within the Earth. CMIC is currently reviewing a proposal to further develop this technique for the Cosmic ray muons impinging the Earth’s surface penetrate to various depths depending on the type and amount of material encountered along their path. The number of muons that reach the detectors will be reduced in direction by the high-density mapping of potential mineral- pods. ization. As part of its research program, CMIC’s Exploration Innovation Consortium is considering of muons that pass through the Earth initiated by AAPS. The development taking on a portion of this ongoing with an array of muon detectors of greenfield exploration equipment research project advocated by Bryman placed at underground locations, the and methods is currently in the planand Advanced Applied Physics Soludistribution of underground mineral ning stage and other applications of tions Inc. (AAPS), a research group formations can be explored. cosmic ray muon tomography are affiliated with TRIUMF, Canada’s being explored. National Laboratory for Particle and Applicability to mining Nuclear Physics, located on UBC’s Tomography using cosmic ray Principles of cosmic ray muon campus in Vancouver. muons is a technique that can detertomography mine the density distribution of geoThe cosmic ray muon tomography Muons 101 logical structures at depths of up to exploration technique is similar in Although muon tomography one kilometre. It can potentially be concept to that employed in medical sounds “sci-fi,” it is not. Muons are used to localize, in 3D, valuable minand industrial tomographic imaging, elementary particles similar to elec- eral deposits such as massive sulsuch as computed tomography (CT) trons, but heavier. The cosmic rays phides and uranium ores. Such where differential absorption of X-rays penetrating the Earth’s atmosphere deposits with higher density than suralong various lines of sight is used to produce a downpour of various ele- rounding materials are detectable due construct image slices of a patient or mentary particles – including muons, to higher levels of cosmic ray muon object under study. which are capable of penetrating attenuation. Indirect measurements The figure illustrates the muon several kilometres into the Earth’s demonstrating the potential of this tomography concept in which muon surface. Their energy diminishes technique are well-documented and sensors are placed in a subterranean through a process of ionization as have been published, although none mine and in one or more bore holes. they travel through the Earth. More have been directed at exploration. The underground sensors determine specifically, the attenuation of the Measurement and simulations have the directions of cosmic ray muon muons as they lose their energy is been performed to validate the basic trajectories. After a suitable observarelated to the total amount of material principles of muon geophysical tomogtion period, the data set for each they pass through. Therefore, by raphy, and a program demonstrating detector position shows the intensity monitoring the rate and trajectories the utility of this technology in situ was distribution or number of events 88 | CIM Magazine | Vol. 6, No. 8

Courtesy of Konstantin Sarafis

Tom Hynes

innovation | COLUMNS

observed at various angles. The information obtained from a set of sensors at different locations may then be inverted to obtain a 3D density map of the area above the detectors. The sensitivity of the density image depends on the depth of the survey region, the complexity of the geological environment, the density contrast of the structures being surveyed, and the period of data collection for a given array of sensors. The limiting spatial resolution obtainable for significant density variations where deposits may be located is expected to be, for example, less than a few metres at a distance of 100 metres from the sensors. The technology for constructing appropriate cosmic ray muon sensors exists, but customized designs are required for underground measurements. Sensors may be placed in existing mine sites

and tunnels or in boreholes at various depths.

Stage of development Bryman and AAPS have successfully pursued a proof-of-principle demonstration of muon geotomography at a mine in Strathcona Park in British Columbia. The well-known Myra Falls VMS deposit was imaged, and analysis and imaging techniques were carried out in conjunction with scientists at the Geological Survey of Canada and the University of Bern. Additional muon sensors are currently in development for further validation at advanced mine sites in regions of unknown mineralization. In addition to an infrastructure

Douglas Bryman discussed muon tomographyâ&#x20AC;&#x2122;s application to mining in the March/April 2010 issue of CIM Magazine.

of muon sensors, inversion techniques have been developed to generate 3D models of mineralization zones in collaboration with the Geological Survey of Canada and the UBC Geophysical Inversion Facility. CMIC is considering becoming involved in the portion of the project that relates to the development of borehole muon sensors that can be deployed down drill holes. So, no, it is not science fiction, but only because the fiction of science has been overtaken by its real-world application. CIM

author Tom Hynes has worked in the uranium and base metals industries, and has been a provincial regulator and a federal government research manager. He is the executive director of the Canada Mining Innovation Council.

THE CIM-BEDFORD CANADIAN

Young Mining AWARDS Leaders 2012 Call

for Nominations

DO YOU KNOW A YOUNG INDUSTRY LEADER, INNOVATOR OR OUTSTANDING ACHIEVER? This is your opportunity to honour an inspirational Canadian whose accomplishments consistently raise the bar in areas such as operations, technical services, project management, or any other discipline. Nominees must be either Canadian citizens or landed immigrants, 39 years of age or under, and working for any mining company, engineering or consulting firm, contractor or supplier in the mining industry, anywhere in the world. Nominators must also work in the industry. Nominees will be judged by a panel of industry experts, and winners will be recognized at the CIM Conference & Exhibition Edmonton 2012. Visit www.bedfordgroup.com/awards or www.cim.org/awards/CIM-Bedford.cfm for details. Nominate today! Deadline March 16, 2012.

December 2011 / January 2012 | 89

COLUMNS

| metals monitor

Drilling activity continues to keep MEG’s PAI afloat despite rattled markets The staff of Metals Economics Group

The Metals Economics Group Pipeline Activity Index (PAI) increased for the second consecutive month to reach a four-month high in September, driven by impressive numbers of significant drill results and a jump in initial gold resource announcements. In October, however, the increased number of significant drill results was not enough to outweigh poor financing conditions, dropping the PAI slightly. The industry’s aggregate market cap plummeted during a rough September, falling below $1.8 trillion for the first time since August 2010. Market caps recovered to $1.96 trillion in October – still below 2011’s year-to-date monthly average of $2.23 trillion. Despite softening metals prices, the number of significant drill results increased in the September-October period. The impact of recently fluctuating metals prices and ongoing market turmoil on explorers – especially juniors – will likely play out during the remainder of 2011 and into early 2012. North America, Latin America and Australia-Pacific together accounted for 77 per cent of the significant gold results and 86 per cent of the base metals results in September-October, up from 68 per cent and 72 per cent, respectively, for the corresponding period in 2010. The number of initial resources announced in September matched 2011’s one-month high. Gold led and September’s numbers presented the second-highest one-month total since 2008, which is not surprising given the steady

rise in gold exploration seen throughout most of 2010 and 2011. Latin American projects accounted for four of the top five initial gold resources and two of the top five initial base metals resources, giving the region 57 per cent of the overall in situ value of resources announced in SeptemberOctober. The number of significant financings (US$2 million minimum) completed by junior and intermediate companies slid for the third consecutive month in October, as already volatile markets continued to be hampered by global growth concerns and sovereign debt problems. With $1.07 billion raised, September-October marks the lowest total for gold financings since January-February 2010. In addition, the number of base metals financings marks the lowest total for this group since May-June 2009. CIM

MEG Pipeline Activity Index (PAI), November 2011

Significant junior and intermediate financings completed

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

For more information and to purchase the complete MEG Industry Monitor, visit www.metalseconomics.com.

author Metals Economics Group is a trusted source of global mining information and analysis, drawing on three decades of comprehensive information and analysis, with an unsurpassed level of experience and historical data.

COLUMNS

| women in mining

Hot off the press Miner shines bright light on the industry with a new book series Heather Ednie

“With Joe having set the cadence, I counted down the rest of the way, and at precisely one second past zero, the ground rumbled, dust puffed, and rock crumbled as if Mother Earth had simply made a polite cough. The sequential timing of the explosives was executed perfectly to minimize the ground vibration. The sky was cloudless and windless, which minimized any air blast. The dust settled quickly on top of the heap of limestone – perfectly blasted rock sized at twenty-four inches or less. The excitement I felt swelled into pride as I saw Ronnie rise to his feet with a grin.” ~ Liv Bergen, In the Belly of Jonah

“I love my day job,” says Sandra Brannan, author of the sizzling new Liv Bergen mystery/thriller series. When not at the computer crafting an elaborate plot for her next book, Brannan can be found at Pete Lien and Sons, a family-owned limestone, iron ore and gypsum producer with operations in South Dakota, Wyoming and Colorado, where she is the vice-president of corporate development. Growing up, Brannan spent her summers working at the quarries, during which time her love of the industry grew. “As a teen, all I could think was what other job lets me wear jeans and boots to work, play in the rocks all day with big equipment, hike in the woods looking for limestone, and allow me to enjoy God’s playground each day.” With a specific career path in mind, she earned an industrial engineering degree and an MBA. Then, like the protagonist in her books, she gained five years of experience at the plant where Boeing’s 747 and 767 models are produced, before her official start at Pete Lien and Sons as a shovel operator at the iron ore quarry. From there, she worked her way up through a string of roles in operations, then was mine manager at a number of sites before reaching her current position.

Changing the industry’s image, one book at a time All those years, Brannan was unaware she was gaining inspiration for her career as a writer. Through her passion

for writing and background in mining, she is helping change the negative image that plagues the industry. “At first, I stayed away from mining, but they say ‘write what you know,’” she says. “I thought people would be repelled by a mining protagonist, but the opposite has been true. Following the release of my second book, which is set around a ready mix plant rather than a mine, most of the reader comments I received were requests that I get back to mining with the next book. I’ve been happily surprised by how much enjoyment people get out of the mining content.” The Liv Bergen series will include nine books in all, two of which have already been released: In the Belly of Jonah (September 2010) and Lot’s Return to Sodom (June 2011). The books’ savvy main character runs a limestone quarry and becomes involved in crime solving, which she discovers she possesses a knack for. From the blood-stained front cover through the pages that follow, the series is not for the faint of heart, but the mine manager’s strong character, the illustrative settings and clever storylines make them a highly enjoyable read. In fact, In the belly of Jonah has been so popular that it necessitated a second print run within a month of its release. Although not a common pastime for a mining professional, Brannan thoroughly enjoys shaping the stories around, and sharing her vision of, the modern mining industry with her readers. “There’s so few of us left in the basic industries – ranchers, farmers and miners – but we are responsible for creating new wealth,” she says. “Everyone else does something with it. I’m proud to be at the start of that chain and I’m glad my books help raise people’s opinions about mining to the standards we’re at. They need to know what we’re about. Without us, the economy would screech to a halt.” CIM December 2011 / January 2012 | 91

NEW — Certification in Ore Reserve Risk Upcoming 2011 Seminars and Mine Planning Optimization Spread over a period of four months, this four-week course is designed for busy mining professionals who wish to update their skills and knowledge base in modern modelling techniques for ore bodies and new risk-based optimization methodologies for strategic mine planning. Gain practical experience by applying the following hands-on concepts and technical methods: methods for modelling ore bodies; stochastic simulations, case studies and models of geological uncertainty; and demand-driven production scheduling and geological risk. Instructor: Roussos Dimitrakopoulos, McGill University, Canada • Dates: May 2012 • City: Montreal, Quebec, Canada • Info: www.mcgill.ca/conted/prodep/ore

Strategic Risk Management in Mine Design: From Life-of-Mine to Global Optimization Learn how you can have a significant, positive impact on your company’s bottom line by utilizing strategic mine planning methodologies and software; improve your understanding of strategic mine planning and life-of-mine optimization concepts, as well as your understanding of the relationship of uncertainty and risk, and how to exploit uncertainty in order to maximize profitability. Note: The strategic mine planning software used is Whittle; an optional half-day skills refresher workshop on Whittle may be available. Instructors: Gelson Batista, MPX, Brazil, and Roussos Dimitrakopoulos, McGill University, Canada • Date: March 2012 • City: Toronto, Ontario, Canada

An Introduction to Cutoff Grade Estimation: Theory and Practice in Open Pit and Underground Mines Cutoff grades are essential in determining the economic feasibility and mine life of a project. Learn how to solve most cutoff grade estimation problems by developing tech-

niques and graphical analytical methods, about the relationship between cutoff grades and the design of pushbacks in open pit mines, and the optimization of block sizes in caving methods. Instructor: Jean-Michel Rendu, Newmont Mining Corporation, USA • Date: September 5-7, 2012 • City: Montreal, Quebec, Canada

Geostatistical Mineral Resource/Ore Reserve Estimation and Meeting the New Regulatory Environment: Step by Step from Sampling to Grade Control Learn about the latest regulations on public reporting of resources/reserves through state-of-the-art statistical and geostatistical techniques, how to apply geostatistics to predict dilution and adapt reserve estimates to that predicted dilution, how geostatistics can help you categorize your resources in an objective manner, and how to understand principles of NI 43-101 and the SME Guide. Instructors: Marcelo Godoy, Golder Associates, Chile, Jean-Michel Rendu, Newmont Mining Corporation, USA, and Roussos Dimitrakopoulos, McGill University, Canada • Date: September 10-14, 2012 • City: Montreal, Quebec, Canada

Mineral Project Evaluation Techniques and Applications: From Conventional Methods to Real Options Learn the basics of economic/financial evaluation techniques, as well as the practical implementation of these techniques to mineral project assessments, how to gain a practical understanding of economic/financial evaluation principles, and how to develop the skills necessary to apply these to support mineral project decisions. Instructor: Michel Bilodeau, McGill University, Canada • Date: October 22-25, 2012 • City: Montreal, Quebec, Canada

Sudbury’s early years: the legacy of CPR and CCC Two billion years ago, a massive meteor slammed into the Earth, leaving behind a crater that would later be known as the Sudbury Basin. For over a century, this broad valley has hosted a plethora of mines along its rim, making Sudbury the largest integrated mining complex in the world and famous for its abundance of nickel. The first hint at Sudbury’s rich deposits came in 1856, when land surveyor Albert Salter noted a deflection on his compass needle and, suspecting mineral deposits, contacted Alexander Murray, a geologist with the Geological Survey of Canada (GSC). Murray found copper, iron and nickel, but at the time, the area was too remote to The opening of the Canadian Copper Company's Copper Cliff Mine in 1886. The prospector, Thomas Frood, is in the background, left. warrant much interest. This would change in 1883 when the Canadian Pacific Railway (CPR) came through the area Canadian Copper Company (CCC) and opened the Copper on its long trek across the country. CPR would make its Cliff Mine. It was only after CCC began processing its first mark before even arriving – one of its construction engi- Copper Cliff ore at a smelting plant in New Jersey that they neers named the site “Sudbury” after his wife’s birthplace in realized the extent of nickel in the ore. Nickel was not in England, trumping the name that the Jesuit mission estab- high demand at the time, but that would change with World lished that same year: Sainte-Anne-des-Pins. War I, when it would become an essential part of the war CPR construction camps were full of men who knew a industry. thing or two about prospecting. In the spring of 1883, CPR In 1902, CCC was absorbed into the International Nickel doctor William Howey came across copper-stained rocks Company (Inco). Two years earlier, CCC opened two addiwhile part of a search party. Howey had the samples sent to tional mines: Creighton and Stobie. Both mines had a diffithe director of the GSC, Alfred Selwyn, who pronounced the cult start, but when a larger ore body was found at Creighton samples worthless. in 1914, the company grew. In 1924, Inco discovered an Howey had lost out, but Selwyn would get a chance to additional 90 million tonnes of ore on their Frood property. redeem himself. Later that year, Thomas Flanagan, a blackInco’s nearest competition was the Mond Nickel Comsmith for a CPR construction crew, came across more copper pany, which was operating on a property known as the sulphides on a hillside. Selwyn took samples when CPR cut Frood Extension. In 1926, the two companies discovered through the site in 1884 and this time, accurately assessed that the Frood and Frood Extension ores were one continuthe value of the ore. The land was purchased for a mere dollar ous ore body. This was a serious problem. an acre by the Murray brothers and their partners; the MurThey knew that separately they would only inhibit one ray Mine would eventually be purchased by Inco in 1925. another’s production, with wasted ore left between their two It was yet another CPR employee – Thomas Frood, a operations and wasted resources through duplicated protimekeeper for a CPR construction crew – who made what cessing facilities. The presidents of both companies got was perhaps the area’s most important discovery. In the together and agreed on a merger. On January 1, 1929, Mond spring of 1884, Frood set off into the woods after being was integrated within Inco. Soon after, Inco discovered additipped off by a trapper about a possible mineral outcropping. tional extensions of the Frood ore. Both he and his partner, A. J. Cockburn, staked a claim and It was around this time that Falconbridge began mining then sold their titles. in the area, and the two companies of Inco (now Vale Inco) American entrepreneur Samuel Ritchie eventually took and Falconbridge (now Xstrata Nickel) would lead mining ownership of the Frood land and, in 1886, established the production into the next century. CIM

City of Greater Sudbury Historical Database

Correy Baldwin

December 2011 / January 2012 | 93

cim news | award winner From believing to seeing How a CIM award winner’s instincts and vision brought mining projects to fruition By Correy Baldwin

David Copeland

Great careers often begin with simple wonders. “As a kid I was fascinated by volcanoes,” says David Copeland, director of project development at Hunter Dickinson and the recipient of this year’s A.O. Dufresne Award. “Growing up on the West Coast, I saw a lot of volcanoes and volcanic terrains,” he recalls, “and I thought, ‘I want to study volcanoes and geology.’” Copeland studied economic geology at the University of British Columbia and apprenticed as a professional engineer. “In those days it was easy to get jobs in exploration,” he says. “I worked on drill rigs and in exploration camps, so I had quite a bit of experience by the time I finished school.” After graduating, he worked for International Nickel and later for Kennecott in the South Pacific region, including the Solomon Islands, New Guinea and throughout Australia. During these times, a cadre of people went from project to project and Copeland was constantly being introduced to new things, expanding his experience beyond geology. “It taught

me that these kinds of projects are multi-disciplined and multi-skilled,” he says. “It doesn’t matter what grade the deposit is if you’re not thinking about the process side or infrastructure. You need some perspective on those things early on.” In 1986, BP-Selco’s technical services group concluded that, from a technical and scientific perspective, porphyry copper-gold deposits related to alkaline intrusions did not exist in the North American craton. Mark Rebagliati, currently executive vicepresident, global exploration, Hunter Dickinson, staked the Mt. Milligan property for BP-Selco in 1983 and believed these deposits did exist. He approached Copeland with a proposal to develop Mt. Milligan. Copeland was familiar with these alkaline systems from his work in the

challenges. “A project has to be a catalyst for other things as well,” he says. “Projects are like the anchor store in a shopping development: they provide opportunity and infrastructure for a region. Mines don’t have to be large to benefit a region; even a small boutique gold mine can have a significant effect on a region and on a community. We started understanding and appreciating that philosophy long before buzzwords of sustainability and community social license came along.” This approach also played a role in developing the Kemess project in central British Columbia, another project for which Copeland is recognized. “We realized early on that the key was going to be the infrastructure, upgrading access and providing power,” he says. “The question was,

“Mines don’t have to be large to benefit a region; even a small boutique gold mine can have a significant effect on a region and on a community.”

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

South Pacific and was convinced that Rebagliati was right about the area’s potential. Today, Mt. Milligan is set to become the first major metal mine to open in British Columbia in 15 years after the Kemess South Mine, a previous Copeland-Rebagliati success. It was also the project around which Hunter Dickinson developed, Copeland says, and it set the tone for the company’s business approach. “We look at where people have encountered geological technical challenges and we ask ourselves: How can we solve this?” he explains. “How can we look at these challenges differently and turn them into something positive?” Copeland adds that it goes further than just seeing an opportunity for corporate growth or solving geologic

‘what else could be done with this infrastructure for the region and communities?’ We saw that there were opportunities for fishery enhancement, wildlife protection, wilderness tourism, power for other projects, potential employment and stability for local First Nations communities, and skill training for residents in these remote regions that could be used elsewhere,” Copeland explains. “There were potential partnering opportunities with agencies and groups to ensure protection of natural resources, and sponsorship of longterm studies. All of these are issues and challenges that a mining project and its associated infrastructure can bring positive solutions to.” CIM

cim news

Mining and the silver screen On November 17, an enthusiastic crowd of over 100 people gathered at Montreal’s Cinema du Parc for the second edition of the Mining Film Festival. ArcelorMittal Mines Canada, IDNR-TV and CIM joined forces to bring four short films and one fulllength film to the public. Industry representatives and students came together to celebrate an evening in which mining and natural resource industries could be observed objectively, with the intention of bringing awareness to its developments in Quebec and around the world. The festival’s highlight was the screening of “The Summit of the Depth,” a 115-minute documentary by cinematographer and producer Ivor Barr that looks at daily life in present-day mining communities. The documentary uncovers the realities of the resource industry, in an era where Quebec’s rural economic and social development stands out on a backdrop of Plan Nord. As part of the festival’s Tribute and Recognition Awards, local leaders were presented with honours. Jean Vavrek, CIM’s executive director, presented a special plaque, named for CIM’s Mining 4 Society outreach and education program, to André Lavoie, communications and public relations director of the Quebec Mining Association (QMA). Dan Tolgyesi, the association’s executive director, accepted the plaque on Lavoie’s behalf. “Lavoie has shown relentless commitment in telling the story of mining to the public at large,” said Vavrek. “This award reflects CIM’s commitment to informing and educating the public about the integral role that the mining, minerals, metals and materials [the 4 Ms] industries play in our everyday lives.” CIM

IDNR-TV

By H. B. George

The Mining Film Festival honoured regional leaders that have made major contributions to the industry.

L’industrie minière et le grand écran Le 17 novembre, une foule enthousiaste d’une centaine de personnes s’est réunie au Cinéma du Parc de Montréal pour la 2e édition du Festival du film minier. ArcelorMittal Mines Canada, IDNR-TV et l’ICM ont fait alliance pour présenter quatre courts métrages et un long métrage au public. Des représentants de l’industrie et des étudiants se sont réunis pour célébrer une soirée permettant d’observer objectivement l’industrie minière et l’industrie des ressources naturelles dans le but de sensibiliser la population aux développement de ces industries au Québec et dans le monde entier. Le point saillant du festival fut la projection de « Le Sommet des profondeurs », un documentaire de 115 minutes du cinématographe et réalisateur Ivor Barr qui se penche sur la vie journalière des communautés minières d’aujourd’hui. Le documentaire met à jour les réalités de l’industrie des ressources, dans une ère faisant ressortir le développement économique et social des communautés rurales du Québec sur un arrière-fond de Plan Nord. Des leaders locaux ont reçu des distinctions dans le cadre des Trophées Hommage et Reconnaissance du festival. Jean Vavrek, directeur exécutif de l’ICM, a présenté une plaque spéciale nommée pour le programme de sensibilisation et d’éducation M4M de l’ICM à André Lavoie, directeur des communications et des relations publiques de l’Association minière du Québec (AMQ). Dan Tolgyesi, directeur exécutif de l’association, a accepté la plaque au nom de M. Lavoie. « M. Lavoie a travaillé sans relâche à raconter l’histoire de l’industrie minière au grand public », a déclaré M. Vavrek. « Cette distinction fait état de l’engagement de l’ICM à informer et éduquer le public au sujet du rôle essentiel que jouent les industries des mines, minéraux, métaux et matériaux [les 4 M] dans notre vie quotidienne. » ICM December 2011 / January 2012 | 97

cim news

| distinguished lecturer

Understanding the greater picture Distinguished Lecturer shares insights on iron oxide copper-gold deposits By Alexandra Lopez-Pacheco A pioneer in exploration research, Hamid Mumin was one of the first to look into iron oxide copper-gold deposits in the Great Bear Magmatic Zone in the Northwest Territories. His career as a geologist and researcher spans more than two decades involving resource discoveries and developments around the Hamid Mumin world. As a geology professor at Manitoba’s Brandon University, Mumin has published numerous papers and technical reports on economic geology and is the co-editor of Ore Mineral Atlas, as well as Exploration for Iron Oxide Copper-Gold Deposits: Canada and World Analogues. A former president of Geoscientists Canada, Mumin joins the roster of speakers in this season’s CIM Distinguished Lecturers Series to share his insights on iron oxide coppergold deposits in a genetic context and the significance of these deposits to exploration. CIM: How did you get involved in the study of iron oxide coppergold deposits? Mumin: It started with a request from Fortune Minerals in 1995, which was working in the Great Bear Magmatic Zone in the Northwest Territories. The Geological Survey of Canada had done some preliminary work the previous year that suggested there may be a new mineralization type in that region; namely, iron oxide copper-gold deposits, which had never been explored in Canada. CIM: What was the result of the early research you carried out? Mumin: We made a very promising discovery by applying the exploration model for iron oxide copper-gold deposits, and that discovery is now Fortune Mineral’s NICO Deposit, which is being developed. It became evident that there was great potential for this type of mineralization to occur in the Great Bear Magmatic Zone. CIM: Despite your findings, there remains quite a lot of controversy around the iron oxide copper-gold type mineralization. What is your view on this? Mumin: There are still a number of people who don’t appreciate the fact that many scientists around the world have actually classified and grouped a particular type of deposit under the category of iron oxide copper-gold and associated deposit 98 | CIM Magazine | Vol. 6, No. 8

types. They wonder why they are lumping such a wide range of seemingly disparate deposit types under this classification. So there’s a great need for some clarity as to what we really mean when we refer to iron oxide copper-gold type proper. We’re not actually lumping it all together. There is a very clear and distinct definition for iron oxide copper-gold type proper, and when we look at the genetic context – how these deposits form – it becomes very clear as to why there is a great variety of associated deposit types that can form within the same systems, at the same time, in the same areas, and by similar and related processes. CIM: What is the reason for the variety? Mumin: These deposits generally form in the heart of volcano-plutonic complexes. The fluids and gasses coming off the magma cause mineralization, and when those gasses and fluids react with different rocks in different ways and under different circumstances, they produce a variety of disparate but related types of mineralization. The magmatic-hydrothermal processes produce deposits that can appear very different, even though they’re all related to a single greater event. Going back to the controversy, what’s important is not the classification or whether the mineralization types should be grouped together. What’s important for exploration is the fact that they are genetically related. If you understand those genetic and spatial relationships, then this gives you a very powerful exploration tool. In other words, if you find one type over here, then you know you might be able to find other related mineralization elsewhere, and we know something about where that elsewhere might be, because we understand the relationships between them. CIM: So this represents a very significant discovery for exploration? Mumin: Yes. If you understand the greater picture, you can be more effective in your exploration and you can simultaneously search for a number of deposit types as opposed to one thing only – and we certainly see tremendous evidence of that in parts of the Great Bear Magmatic Zone. Because it’s so far north and the rocks are so well-exposed, it’s a great opportunity for geologists to walk the ground and visually see all these relationships. Very often, you’re speculating as to what’s happening in between outcrops, but in the Great Bear Magmatic Zone, you have huge areas where it’s almost continuous rock exposure. We can map and document very clearly what the relationships between the deposits are. This is probably the greatest contribution that this remote area has made to the field of mineral deposit geology and exploration. CIM

cim news

| scholarship winner

When preparation meets opportunity Scholarship winner is not taking anything for granted

Ella Goldberg, a fourth-year earth sciences student at Dalhousie University in Halifax, has won one of four $1,000 Taking Flight Scholarships. The scholarship is awarded annually by CIM and the Canadian Mining and Metallurgical Foundation (CMMF) to qualified Aboriginal high school and post-secondary students who are aiming to pursue a career in the mining, oil or gas industries. “It was a really good day when I heard the news,” says the Guelph-born student. Goldberg, 20, whose grandmother is a Métis from Western Canada, is an honours student with an interest in petroleum geology. She spent last summer working for Shell, analyzing data for future oil field developments, and had experience in mining from her previous summer job with Beaufield Resources near James Bay, Quebec. “These internships really helped me explore my options,” Goldberg says. Last March, she and her team of undergraduates placed third in the Imperial Barrel Award competition. “This was the first time I had a project of my own to care about,” she says, “and we really excelled in a competition that normally has graduate student participation.” The competition was Goldberg’s first introduction to oil and gas – and it was a seminal moment in her professional life. Starting next September, she will be working in Calgary for Shell Canada with their on-shore gas group. The company has already given her burgeoning career a boost. “I want to go back to school to do a master’s, and Shell wants to help me pursue that,” Goldberg says, “whether I take time off from work or do it simultaneously.” Goldberg’s past volunteer work at Guelph’s Anishnabeg Outreach Centre, a non-profit organization that assists Aboriginal individuals in their search for employment and educa-

Courtesy of Ella Goldberg

By Irwin Rapoport

Ella Goldberg at the Burgess Shale fossil site.

tional opportunities, motivated her to make use of all the possibilities that come her way. “When I went in there, I realized that I was really lucky and had a lot of opportunity, and that a lot of Aboriginal youth have been through hardships,” she says. “I would like to be a role model for other Aboriginals.” Goldberg says she has always been attracted to science. Her father is a toxicologist and her parents urged her to explore the various facets of science.

“I had the same support from my supervisor last summer,” she explains. “He answered all my questions and explained every aspect to me so that it all made sense.” After graduation, Goldberg plans to take the summer off and perhaps do a trip across Canada. She is looking forward to working in Alberta, where she will take advantage of her closeness to the Rockies to ski, hike and be outdoors. CIM

Obituaries John Raymond Banks, a veteran of the Second World War who served with the Royal Canadian Air Force and the Canadian Army, had a life-long professional association with mining. He was knowledgeable about every facet of the industry, from the drafting of mineral exploration projects, to mining the ore, to its ultimate treatment. He joined CIM in 1956 and served the Institute in a variety of capacities, including working as the chairman of the Vancouver Branch. He was made a Life Member of the Institute in 1990 and in 1993 was awarded a Fellowship for his outstanding contributions to the Canadian mining industry – an achievement of which he was immensely proud. He passed away on October 5, 2010. George E. Davies joined CIM in 1961 and became a Life Member in 1993. Peter Andrew Spencer passed away on October 8, 2011. He joined CIM in 2005.

December 2011 / January 2012 | 99

CIM CALENDAR OF EVENTS 2012 CALENDRIER DES ACTIVITÉS DE L’ICM 2012 THE COMMUNITY FOR LEADING INDUSTRY EXPERTISE LA COMMUNAUTÉ POUR UNE EXPERTISE DE PREMIER PLAN

CONFERENCES/CONGRÈS 44th ANNUAL CANADIAN MINERAL PROCESSORS OPERATORS’ CONFERENCE LE 44e CONGRÈS ANNUEL DES MINÉRALLURGISTES DU CANADA (CMP 2012) January 17-19, Ottawa, ON www.cmpsoc.ca

CIM CONFERENCE & EXHIBITION CONGRÈS ET SALON COMMERCIAL DE L’ICM (CIM 2012) May 3-9, Edmonton, AB www.cim.org/edmonton2012

21st CANADIAN ROCK MECHANICS SYMPOSIUM (ROCKENG 2012) May 5-9, Edmonton, AB www.cim.org/rockeng2012

125th ANNIVERSARY OF THE MINING SOCIETY OF NOVA SCOTIA LE 125e ANNIVERSAIRE DE LA SOCIÉTÉ MINIÈRE DE LA NOUVELLE-ÉCOSSE June 6-8, Cape Breton, NS www.miningsocietyns.ca

6th INTERNATIONAL CONFERENCE & EXHIBITION ON MASS MINING (MASSMIN 2012) June 11-13, Sudbury, ON www.cim.org/massmin2012

51st ANNUAL CONFERENCE OF METALLURGISTS LE 51e CONGRÈS ANNUEL DES MÉTALLURGISTES (COM 2012) September 30-October 3, Niagara, ON www.metsoc.org/com2012

www.cim.org

NEWFOUNDLAND AND LABRADOR

Québec Nord-Est

Newfoundland

RESPONSABLE : BERTRAND LESSARD (BERTRAND.LESSARD@CLIFFSNR.COM) VILLE : SEPT-ÎLES, QC

CONTACT: LEN MANDVILLE (LENMANDVILLE@GOV.NL.CA) CITY: ST. JOHN’S, NL

SEPTEMBRE

FEBRUARY 1

SPRING NOVEMBER 1-3

CIM Distinguished Lecturer (TBD) in conjunction with the Alexander Murray Geological Club Winter, Memorial University Mineral concentrate processing site tour with guest speaker John Halfyard Mineral Resources Review 2012, Delta St. John’s Hotel & Conference Centre

NEW BRUNSWICK

New Brunswick

SOIRÉE TECHNIQUE MENSUELLE, AUBERGE DES GOUVERNEURS

3e lundi du mois de janvier, février, mars, avril, mai, octobre, novembre, décembre

Rouyn-Noranda RESPONSABLE : CLAUDE GAGNIER (CLAUDEGAGNIER@HOTMAIL.COM) VILLE : ROUYN-NORANDA, QC PREMIER SEMESTRE 24 JANVIER FÉVRIER 15 FÉVRIER

CONTACT: SEAN MCCLENAGHAN (SEAN.MCCLENAGHAN@GNB.CA) FEBRUARY 2 MARCH 16-17 JUNE 16 SEPTEMBER 20-22 NOVEMBER 5

NOVEMBER 6

CIM Student–Industry Meet and Greet, University of New Brunswick, Fredericton, NB Potash Cup – Curling Bonspiel, Sussex, NB Petroleum Golf Cup Tournament, St. Ignace, NB 37th CIM NB Branch Annual Convention, Bathurst and Beresford, NB Annual General Meeting with CIM Distinguished Lecturer (TBD), Delta Fredericton Hotel, Fredericton, NB CIM Student–Industry Meet and Greet, University of New Brunswick, Fredericton, NB

DÉBUT MARS MARS 15 MARS 18 AVRIL 24 AVRIL FIN AVRIL 15 MAI 26 SEPTEMBRE OCTOBRE

QUÉBEC

Chapais-Chibougamau RESPONSABLE : PATRICK HOULE (PATRICK.HOULE@MRNF.GOUV.QC.CA) VILLE : CHIBOUGAMAU, QC FIN AVRIL

Activités lors de la Semaine minière du Québec 2012

Soirée de présidents

OCTOBRE NOVEMBRE 9 NOVEMBRE DÉCEMBRE

Formation : L’échantillonnage en traitement de minerai Conférence : « Detour Gold », UQAT Formation : Gérer la résistance au changement Éminent conférencier de l’ICM : William Westgate, UQAT Conférence : Strateco, Projet Matoush, UQAT Formation : Introduction aux modèles financiers Éminent conférencier de l’ICM : Klaus Kacy, UQAT (à confirmer) Formation : Geotic log Éminent conférencier de l’ICM : Bernhard Klein, UQAT Semaine minière du Québec 2012 Formation : Gisements météoritiques Conférence : Éric Ducharme, Aurizon, projet Casa Bérardi, UQAT Conférence : Nouvelles règles pour rapports techniques 43-101 par la Commission des valeurs mobilières de Montréal Formation : Géométallurgie Souper dégustation d’huîtres Conférence : Pierre Levesque, mine Mouska, IAMGOLD Éminents Conférenciers de l’ICM : à confirmer, UQAT

Harricana

Saguenay

RESPONSABLE : GÉRALD LEFRANÇOIS (GERALD@CORRIVEAUJL.COM) VILLE : VAL-D’OR, QC

RESPONSABLE : STEVE THIVIERGE (STEVE_THIVIERGE@IAMGOLD.COM) VILLE : CHICOUTIMI, QC

25 JANVIER 15 FÉVRIER 16 MARS 25 AVRIL 2 JUIN

Conférence : (présentateur à venir), Hôtel Forestel Conférence : Critical Element, Hôtel Forestel Vins et Fromages, Hôtel Forestel Conférence : Guy Belliveau (« Le projet Éléonore des Mines Opinaca »), Hôtel Forestel Tournoi de golf, Club de Golf le Belvédère

Montréal RESPONSABLE : MARTIN POIRIER (MPOIRIER@SEMAFO.COM) VILLE : MONTRÉAL, QC 24 JANVIER FÉVRIER MARS 30 AOÛT

Éminent conférencier de l’ICM : Hamid Mumin, McGill Faculty Club Souper conférence Souper conférence Tournoi de golf annuel

25 JANVIER FÉVRIER 16 FÉVRIER AVRIL FIN AVRIL MAI SEPTEMBRE OCTOBRE NOVEMBRE

Thetford Mines RESPONSABLE : NORMAN BOUTET (NORMAND.BOUTET@TM.CGOCABLE.CA) VILLE : THETFORD MINES, QC

Québec

4 FÉVRIER

RESPONSABLE : PIERRE VERPAELST (PIERRE.VERPAELST@MRNF.GOUV.QC.CA) LIEU : UNIVERSITÉ DE LAVAL, QUÉBEC, QC

8 FÉVRIER

23 JANVIER 14 FÉVRIER 26 MARS 23 AVRIL

Éminent conférencier de l’ICM : Hamid Mumin Éminent conférencier de l’ICM : William Westgate Éminent conférencier de l’ICM : Barbara Kirby Éminent conférencier de l’ICM : Bernhard Klein

Éminent conférencier de l’ICM : Hamid Mumin, UQAC « 5 à 7 » et l’assemblée annuelle, UQAC Éminent conférencier de l’ICM : William Westgate, UQAC Visite industrielle, lieu à confirmer, Lac-St-Jean Semaine minière du Québec 2012, Bar des mines et discussion Exposition minérale régionale, UQAC Visite industrielle, lieu à confirmer Oktoberfest de la section locale Saguenay Party d’huîtres

AVRIL MAI AOÛT OCTOBRE NOVEMBRE

Tournoi de curling, assemblée annuelle, élections et remise des bourses pour étudiants Conférence: Dominic Gravel , projet Meadowbank, Mines Agnico-Eagle Limitée Conférence : Jean-François Dorion, mine Niobec Visite industrielle, lieu à confirmer Tournoi de golf, Club de golf et de curling de Thetford Mines Conférence technique Conférence technique

ONTARIO

Cobalt CONTACT: TODD A. STEIS (TODD.STEIS@MTI.CA) CITY: HAILEYBURY, ON

Seafood Night February, March, October, November

JANUARY AND SEPTEMBER MONTHLY MEETINGS

SUMMER MID-JULY SEPTEMBER OCTOBER NOVEMBER

Hamilton CONTACT: SHANNON CLARK (SHANNON.CLARK@ARCELORMITTAL.COM) CITY: HAMILTON, ON

Events still in planning stage

Greater Toronto Area West CONTACT: CATHARINE SHAW (CATHARINE_SHAW@GOLDER.COM) CITY: MISSISSAUGA, ON TECHNICAL LUNCHEON MEETING

CONTACT: BERNIE ROBERTSON (BERNIE.ROBERTSON@KIBL.COM) CITY: NORTH BAY, ON FEBRUARY 23 APRIL 29-MAY 5 AUGUST 6-9 SEPTEMBER

Sudbury CONTACT: CHRISTINE BERTOLI (CBERTOLI@XSTRATANICKEL.CA) CITY: SUDBURY, ON JANUARY 19 FEBRUARY 11 MARCH 22 APRIL 19

Second Tuesday of every month

Northern Gateway 2nd Annual Seafood Mixer, Clarion Resort Pinewood Park Hotel North Bay Mining Week Mining Teachers Tour Golf Tournament, Highview Golf Course

2012 Exploration Round-up, Cochenour Hall Annual Golf Tournament, Red Lake Golf Course Annual Wine and Cheese Night, Campbell Rec Centre-Curling Lounge Annual General Meeting and Seafood Night, Campbell Rec Centre-Curling Lounge Annual Lobsterspiel, Campbell Rec Centre-Curling Lounge

JUNE 15 AUGUST 11 SEPTEMBER 20 OCTOBER 18 NOVEMBER 15

General Membership Meeting: Michael Winship (Quadra FNX), Dynamic Earth Winter Wonderland Dinner & Dance, Caruso Club General Membership Meeting, Dynamic Earth CIM Distinguished Lecturer: Barbara Kirby, Dynamic Earth 15th Annual Lobster Dinner & Dance, Caruso Club 16th Annual Rudolph Kneer Memorial Golf Tournament, Lively Golf Club and Country Club General Membership Meeting, Dynamic Earth Student Oyster Night, Dynamic Earth Social Event, Dynamic Earth

Sudbury Geological Discussion Group

Ottawa

CONTACT: PHIL THURSTON (PTHURSTON@NICKEL.LAURENTIAN.CA) CITY: SUDBURY, ON

CONTACT: JEAN-FRANÇOIS FISET (JEFISET@NRCAN.GC.CA) CITY: OTTAWA, ONTARIO

APRIL 19

Events still in planning stage

CIM Distinguished Lecturer: Hamid Mumin, Willet Green Miller Center

MONTHLY MEETINGS

Porcupine

first Thursday of the months January, February, March, April, May, September, October, November

CONTACT: SHANNON CAMPBELL (RUGGER09@HOTMAIL.COM) CITY: TIMMINS, ON

Toronto

JANUARY 21 FEBRUARY MARCH 4 APRIL MAY AUGUST 25 OCTOBER DECEMBER

CIM Curling Bonspiel Speaker’s Night Speaker’s Night: Vinyl Café with Stuart McLean Spring Break-up Ball, in conjunction with the Porcupine PDAC Speaker’s Night Annual Golf Tournament Steak and Lobster Night Speaker’s Night and Christmas Social

CONTACT: RON SINKIEWICZ (RON.SINKIEWICZ@GOLDCORP.COM) CITY: RED LAKE, ON

WINTER/SPRING

JANUARY 19 FEBRUARY 16 MARCH 7 APRIL 19 MAY 17 JUNE 7 AUGUST 29

Red Lake APRIL 18

CONTACT: RICK HUTSON (RICK@CJSTAFFORD.COM) CITY: TORONTO, ON

CIM Distinguished Lecturer: Barbara Kirby, Lakeview Restaurant Dinner Talk, Lakeview Restaurant

SEPTEMBER 20 OCTOBER 18 NOVEMBER 15 DECEMBER 6

Luncheon & Annual General Meeting, National Club Student–Industry Luncheon, Royal York Hotel Joint PDAC–CIM Luncheon, Convention Centre Branch Luncheon, National Club Joint WIM–CIM Toronto Branch Luncheon, National Club Branch Luncheon, National Club Frank Grieco Memorial Golf Tournament, Glen Abbey Golf Club Joint MES–CIM Toronto Luncheon, National Club Tastes of Toronto, National Club Branch Luncheon, National Club SNC-Lavalin Hamilton Lectures series, National Club

Thunder Bay CONTACT: MARK SMYK (MARK.SMYK@ONTARIO.CA) CITY: THUNDER BAY, ON JANUARY JANUARY FEBRUARY

Steve Williams

APRIL 17 SEPTEMBERDECEMBER

Toronto branch

Mineral Resource Investment Showcase, Valhalla Inn Mineral Exploration Short Course, Masonic Lodge Annual CIM Curling Funspiel, Fort William Curling Club CIM Distinguished Lecturer: Barbara Kirby, Travelodge Airline Hotel CIM Distinguished Lecturer: TBD, Travelodge Airline Hotel

BRITISH COLUMBIA

MANITOBA

Thompson

Crowsnest

CONTACT: INGE ROBINSON (INGE.ROBINSON@VALE.COM) CITY: THOMPSON, MB

CONTACT: JEFF COLDEN (JEFF.COLDEN@TECK.COM) FEBRUARY

Events still in planning stage

Winnipeg CONTACT: ED HUEBERT (EDHUEBERT@MINES.CA) CITY: WINNIPEG, MN

MARCH APRIL 12 JUNE

Events still in planning stage SASKATCHEWAN

Guest speaker: Honourable Christy Clark, Premier of British Columbia (tentative) (Sparwood, BC) Annual Curling Funspiel (Sparwood, BC) CIM Distinguished Lecturer: Jim Utley, Mine Manager’s Night (Fernie, BC) Annual Golf Tournament and Scholarship Fundraiser (Fernie, BC)

North Central BC CONTACT: JOE HINES (JHINES@TCRK.COM)

Saskatoon

FEBRUARY 4

CONTACT: MICHAEL CASTLEBERRY (MICHAEL.CASTLEBERRY@MOSAICCO.COM) CITY: SASKATOON, SK

JUNE 19-21

JANUARY 19 FEBRUARY 16 MARCH 15 APRIL 19 JULY SEPTEMBER OCTOBER NOVEMBER NOVEMBER

Environmental Night, Sheraton Hotel Uranium Night, Sheraton Hotel Student Paper Night, Sheraton Hotel Spring Social, Sheraton Hotel Annual Golf Tourney, The Willows Golf & Country Club General Interest Night Potash Night Mineral Processors Night Annual Ball

Saskatoon Geology Section CONTACT: EKATERINA SAVINOVA (EKATERINA_SAVINOVA@CAMECO.COM) CITY: SASKATOON, SK JANUARY 25 FEBRUARY 21 MARCH 20 APRIL 23 MAY 22

Lecturer: Guoxiang Chi, University of Regina, Travelodge Hotel Saskatoon Lecturer: Peter Wollenberg , AREVA, Travelodge Hotel Saskatoon CIM Distinguished Lecturer: Hamid Mumin, Travelodge Hotel Saskatoon Branch Meeting Branch Meeting

CIM North & South Central BC Branch Curling Bonspiel, Williams Lake, BC CIM North Central BC Branch Annual General Meeting and Golf Tournament, Prince George, BC

South Central BC CONTACT: RICHARD WEYMARK (RICHARD.WEYMARK@TECK.COM) CITY: KAMLOOPS, BC FEBRUARY 4 SEPTEMBER 12-14

CIM North & South Central BC Branch Curling Bonspiel, Williams Lake, BC CIM South Central BC Branch Conference and Annual General Meeting, Kamloops, BC

Trail CONTACT: MARVIN NEUFELD (MARVIN.NEUFELD@TECK.COM) CITY: TRAIL, BC APRIL

Annual General Meeting

TECHNICAL PRESENTATIONS

February, May, September, November

Vancouver CONTACT: TOM BRODDY (TOMB@TKOMINES.COM) CITY: VANCOUVER, BC 3RD WEEK OF NOVEMBER

Vancouver Branch Annual Student Awards Night

ALBERTA

LUNCHEON MEETINGS

Calgary

3rd week of the months February, March, April, May, June, September, October

CONTACT: TERESA LAVENDER (TLAVENDER@NORWESTCORP.COM) PLACE: FAIRMOUNT PALLISER, CALGARY, AB JANUARY FEBRUARY 8

New Iron Ore Development Canada, Lee Nichols Uranium Mining, CIM President Chuck Edwards

TECHNICAL PRESENTATIONS

NORTHWEST TERRITORIES

Yellowknife

second Wednesday of the months March, April, May, June

CONTACT: DAVID WATSON (DAVID_WATSON@GOV.NT.CA) CITY: YELLOWKNIFE, NT

Edmonton

Events still in planning stage

CONTACT: FENNA POELZER (FPOELZER@NACG.CA) PLACE: UNIVERSITY OF ALBERTA FACULTY CLUB, EDMONTON, AB TECHNICAL DINNER MEETINGS

January 9, February 6, March 5, April 16, September 10, October 1, November 19, December 10

Oil Sands - Fort McMurray CONTACT: SANIL SILVARAJAN (SIVARAJAN.SANIL@SYNCRUDE.COM) CITY: FORT MCMURRAY, AB JANUARY 28 JUNE

CIM Fort McMurray Branch Curling Bonspeil, MacDonald Island Park Golf Tournament

INTERNATIONAL

Los Andes-Chile CONTACT: CIMLOSANDES@VTR.NET CITY: SANTIAGO, CHILI

Events still in planning stage

cim news CIM NATIONAL OFFICE | BUREAU NATIONAL DE L’ICM

514.939.2710

Seated, from left to right: Chantal Murphy, Marjolaine Dugas, Joëlle Cyr, Gérard Hamel, Jo-Anne Watier, Martin Doré, Brigitte Farah, Robertina Pillo, Jean-Marc Demers, Angela Hamlyn; standing, from left to right: Magali Gloutnay, Hartley Butler George, Deborah Sauvé, Lucie Vincent, Catherine Thibault, Robert Garcia, Andrea Nichiporuk, Lorent Dione, Laura Foley, Peter Braul, Jean Vavrek, Nathan Hall, Lise Bujold, Nadia Bakka, Martin Bell, Elaine Kinsella, Lamiche Tremblay, Serge Major, Ryan Bergen. Missing: Anne Brosseau, Alexandra Cyr, Mireille Goulet, Ronona Saunders, Joan Tomiuk.

EXECUTIVE | EXÉCUTIF

Jean Vavrek

Executive Director/Directeur exécutif

1301 jvavrek@cim.org

Jean-Marc Demers

Deputy Executive Director/Directeur exécutif adjoint

1314 jmdemers@cim.org

Serge Major

Director, Finance and Administration/Directeur, finances et administration

1318 smajor@cim.org

Lise Bujold

Director, Conferences and Exhibitions/Directrice, congrès et salon commerciaux

1308 lbujold@cim.org

Marjolaine Dugas

Director, Membership Services/Directrice, services aux membres

1302 mdugas@cim.org

Gérard Hamel

Director, IS&T/Directeur, TI&S

1325 ghamel@cim.org

Angela Hamlyn

Director, Media and Communications/Directrice, médias et communications

1303 ahamlyn@cim.org

Mireille Goulet

Executive Coordinator & CSR Project Leader/Coordonnatrice exécutive et Chargée de projets RSE

1302 mgoulet@cim.org

EVENTS AND SUPPLY MANAGEMENT | ÉVÉNEMENTS ET GESTION DES FOURNITURES

Nadia Bakka

Coordinator, Registration and Customer Service/Coordonnatrice des inscriptions et soutien à la clientèle

1333 nbakka@cim.org

Martin Bell

Sales Manager, Exhibitions/Directeur des ventes, salons commerciaux

1311

Magali Gloutnay

Meetings Coordinator/Coordonnatrice de congrès

1320 mgloutnay@cim.org

Chantal Murphy

Meetings Coordinator/Coordonnatrice de congrès

1309 cmurphy@cim.org

Lucie Vincent

M4S Project Coordinator/Coordonnatrice des projets M4S

1332 lvincent@cim.org

mbell@cim.org

FINANCE | FINANCES

Anne Brosseau

Accounts Payable and Special Volumes/Comptes payables et volumes spéciaux

313

abrosseau@cim.org

Alexandra Cyr

Cash Receipts Clerk/Commis caisses recettes

328

acyr@cim.org

Elaine Kinsella

Accounts Receivable/Comptes à recevoir

312

ekinsella@cim.org

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

cim news IT | TI

Lorent Dione

Web Developer/Développeur web

1326 ldione@cim.org

Martin Doré

Web Developer/Développeur web

1322 mdore@cim.org

Robert Garcia

IT & Applications Technician / Technicien, Informatique et applicatifs

1335 rgarcia@cim.org

MEMBERSHIP SERVICES | SERVICES AUX MEMBRES

Joëlle Cyr

Assistant, Membership Programs/Assistante aux programmes, services aux membres

1304 jcyr@cim.org

Laura Foley

Coordinator, Membership Services/Coordonnatrice, services aux membres

1307 lfoley@cim.org

Robertina Pillo

Coordinator, Membership Programs/Coordonnatrice aux programmes, services aux membres

1316 rpillo@cim.org

Lamiche Tremblay

Assistant, Membership Services/Assistante, services aux membres

1300 ltremblay@cim.org

Jo-Anne Watier

Coordinator, Retention Programs, Membership Services/ Coordonnatrice, programmes de retention, services aux membres

1315 jwatier@cim.org

MEDIA & COMMUNICATIONS | MÉDIAS ET COMMUNICATIONS

Ryan Bergen

Senior Editor/Rédacteur principal

1324 rbergen@cim.org

Peter Braul

Section Editor/Chef de rubrique

1336 pbraul@cim.org

Hartley Butler George

Section Editor (Interim)/Chef de rubrique (par intérim)

1331 hbgeorge@cim.org

Nathan Hall

Web Editor/Éditeur web

1330 nhall@cim.org

Andrea Nichiporuk

Section Editor (on leave)/Chef de rubrique (En congé de maternité)

1323 anichiporuk@cim.org

Joan Tomiuk

Managing Editor/Directrice de rédaction

1310 jtomiuk@cim.org

METALLURGY AND MATERIALS SOCIETY OF CIM | SOCIÉTÉ DE LA MÉTALLURGIE ET DES MATÉRIAUX DE L’ICM

Brigitte Farah

Manager, Administration and Meeting Planning/Directrice, administration et planification de conférences

1329 bfarah@cim.org

Ronona Saunders

Coordinator, Marketing and Publications/Coordonnatrice, marketing et publications

1327 rsaunders@cim.org

CANADIAN MINING AND METALLURGICAL FOUNDATION | FONDATION CANADIENNE DES MINES ET DE LA MÉTALLURGIE

Deborah Smith-Sauvé

Manager/Directrice

1334 dsauve@cim.org

ADVERTIZING SALES | VENTE DE PUBLICITÉ (DOVETAIL COMMUNICATIONS: 905.886.6641)

Mike Hackett-Pedler

Sales Associate/Associé aux ventes

317

mhackett-pedler@dvtail.com

Janet Jeffery

Senior Account Executive/Directeur de comptes en chef

329

jjeffery@dvtail.com

Neal Young

Senior Account Executive/Directeur de comptes en chef

325

nyoung@dvtail.com

CIM COUNCIL | CONSEIL DE L’ICM 2011-2012

CIM SOCIETIES | SOCIÉTÉS DE L’ICM Janice Zinck Canadian Mineral Processors Society |

EXECUTIVE | EXÉCUTIF

Janice Zinck

President | Président Chuck Edwards President-Elect | Président élu Terence Bowles Incoming President-Elect | Président élu entrant Robert Schaffer Immediate Past President | Président sortant Chris Twigge-Molecey Finance Chair | Président des finances Michael Cinnamond

Garth Kirkham Ted Knight Alicia Ferdinand

Director at Large | Administrateur général Jim Popowich VICE-PRESIDENTS | VICE-PRÉSIDENTS District 1 John Fleming

Greg Richards Ray Reipas

District 2 Daniel Gagnon District 3 Adam Tonnos District 4 Robert Carey District 5 Tim Joseph District 6 Christopher Ryan International Nathan Stubina

Tony George Dan MacLeod John Hadjigeorgiou

Société canadienne du traitement des minerais Environmental & Social Responsibility Society | Société de l’environnement et de la responsibilité sociale Geological Society | Société de la géologie Maintenance and Engineering Society | Société de l’ingénierie et de l’entretien Management and Economics Society | Société de gestion et de l’économie minérale Metallurgy and Materials Society | Société de la métallurgie et des matériaux Surface Mining Society | Société d’exploitation à ciel ouvert Underground Mining Society | Société d’exploitation minière souterraine Mining Society of Nova Scotia | Société minière de la Nouvelle-Écosse Rock Engineering Society | Société de la mécanique des roches December 2011 / January 2012 | 105

Your funds support/ Vos dons appuie : CIM Distinguished Lecturers Series Programme des éminents conférenciers de l’ICM

Thank you! On behalf of the members of the mining industry, we wish to thank you for responding so generously to our Giving Campaign 2010. Your contributions have helped us raise over $40,000 (excluding special gifts such as gifts of securities). All donations received after December 31, 2010, will be published in the spring 2012 CMMF REPORT, unless you request to be listed as anonymous.

M4S: the educational show on Mining, Minerals, Metals and Materials. M4S : le salon éducatif portant sur les Mines, Minéraux, Métaux et Matériaux

PDAC Mining Matters

The Diamonds Exhibition at the Discovery Centre in Halifax L’exposition Diamants qui s’est tenue au Discovery Centre à Halifax

Merci! Au nom de tous les membres de l’industrie minière, nous vous remercions d’avoir répondu en si grand nombre à notre Campagne de financement 2010. Votre générosité a permis d’amasser plus de 40 000 $ (excluant les dons spéciaux tels que les transferts de valeurs mobilières). Tous les dons reçus après le 31 décembre 2010 seront publiés dans le Rapport de FCMM qui paraîtra au printemps 2012, à moins que vous ne préfériez conserver l’anonymat.

Scholarships to attract good students to the industry Des bourses pour attirer des bons étudiants à l’industrie

n addition to the Giving Campaign, CMMF also benefited from the generosity of donors who made special gifts. Thank you to the late Don Winkler Hurd (1926-2003) – a portion of his gift was received in 2010) – and to the late W. Keith Buck (1920-2010). They generously remembered CMMF in their last wills and testaments.

Don Winkler Hurd W. Keith Buck

En plus de la campagne de financement, la FCMM a aussi bénéficié de la générosité de donateurs qui ont effectué un don spécial. Merci beaucoup à feu M. Don Winkler Hurd (1926-2003) ; une portion de son don a été reçue en 2010, ainsi qu’à feu M. W. Keith Buck (19202010). Ils ont généreusement mis la FCMM sur leur testament.

Anonymous/anonyme (1) Breakwater Resources Ltd. Ms. Jennifer A. Clark Mr. Gordon Davis Echo Bay Minerals Company ICM District de Rouyn-Noranda Kinross Gold Corporation Mr. David S. Robertson SNC-Lavalin Inc. Mr. Robert A. Spencer, FCIM M. et Mme Luc Sauvé Teck Resources Limited The Walmley Foundation

Mr. George C. Coupland Mr. Gerald R. Heffernan, FCIM Mr. Allan D. MacTavish Mr. H. E. (Buzz) Neal, FCIM Mr. Emil H. Nenniger Mr. Andrew Rolf-Von-Den-Baumen

Anonymous/anonyme (2) AME BC Mr. William R. Dengler Mrs. Patricia Dillon, FCIM Mr. Raymond N. Dudgeon Mr. John R. Goode Mr. Peter W. Green Mr. Stephen R. Hurlburt Mr. Larry Stanley Urbanoski Mr. Donald J. Worth, FCIM

Anonymous/anonyme (4) Mr. David G. Adam Mr. Joseph Aiello Mr. M. Norman Anderson Mr. A. Frederick Banfield Jr. Mr. Derek John Barratt Mr. William F. Bawden Mr. Anthony Bayduza M. Jean Béliveau Mr. Colin Keith Benner Mr. William Carl Berridge Mr. Paul Marcus Blythe Ms. Anne Marie Briessenden Mr. Malcolm N. Brodie Mr. R. R. Brown Mr. Robert Bryce, FCIM Mr. Alfons Buzas Mr. William A. Case Mr. Edward H. Chown Mr. Donald W. Coates Mr. W. T. Cohan Mr. Edmund W. M. Cokayne Mr. Gerald E. Cooper Mr. Gerry Cooper M. David Corriveau Mr. Michael Culleton

Mr. Tadeuzs L. Dabroswski Mr. Andrew A. Dasys Mr. William G. Deeks Mr. Robert Dickinson M. Cyrille Dufresne M. René Dufour, FCIM Mr. Kenneth P. Dunne Mr. Piers M. Ebsworth, Eng. Mr. David J. Emery Mr. Peter Ferderber Mr. William H. Eatock Mr. Eugene Fabro Sr. Mr. Richard H. T. Garnett Mr. Carlton N. Goddard Mr. Murray A. Green Dr. Gordon Gross, FCIM Mr. Steven W. Harapiak Mr. Leonard Harris Mr. Donald Hattie Mr. J. Lonnart Hedlund Mr. John Frank Hepburn Mr. Daniel Hewitt Mr. Christian A. Hesse Mr. Chin Choi Ho Mr. W. Warren Holmes Mr. Emmett J. Horne Mr. Trevor L. Horsley Dr. Richard W. Hutchinson Mr. Michael J. Humphris Mr. G. Frank Joklik Mr. Leisle T. Jory M. H. Dean Journeaux, FCIM Mr. Johan J. Kalmet Mr. Edmund T. Kimura, FCIM Mr. Earle J. Klohn Mr. Douglas Arthur Knight Mr. George E. Koivu M. Pierre Lalande Mr. Laurence J. Lamb Mr. Richard H. Lloyd Mr. J. David Mason Mr. Geoffrey C. Marlow Mr. Alex McLean Mr. William McNeil, FCIM Mr. Willem J. Bernelot Moens Mr. John R. Morris Mr. John L. Morton Mr. George Moruzi, FCIM Mr. John Mulholland Mr. Jack Mullins Mr. and Mrs. Jack McOuat, FCIM Mr. Leland R. Norton Mr. and Mrs. John Orton Mr. Arthur Palmer Mr. John H. Parker Dr. William Petruk, FCIM Mr. Robert A. Pollock Mr. Barry Price Mr. Gary R. Rice Mr. Laurie E. Reed Mr. Harold E. Rudd Mr. Lionel A. Ryan, P.Eng. Mr. Vernon Brown Schneider Mr. Terence F. Schorn

Mr. Samuel A. Scott Mr. Steven Scott, FCIM Mr. Colin Smith, FCIM Mr. Hugh R. Snyder Spicer Solution Providers Inc. Mr. Terry J. Thiessen Mr. Steele Tomlinson Mr. W. Anthony Triggs Mr. Chris Twigge-Molecey, FCIM Mr. George Vooro Mr. Jack H. Walsh, FCIM Mr. John H. Walsh, FCIM Mr. Alan R. Watt Mr. Phillip Charles Walford Mr. Douglas P. Walli Mr. Manfred Weg Dr. John O. Wheeler Mr. Richard M. Williams Mr. Michael Winship Mr. L. S. D. Winter Mr. David Wortman Mr. D. M. Wyslouzil, FCIM Mr. Edward M. Yates

Anonymous/anonyme (4) Mr. Brian Abraham, FCIM Mr. Volker Henning Ahlborn Mr. Semih Altan Mr. Sergio Alvarado Mr. John M. Anderson, FCIM Mr. Robert Bell Mr. Edward Berdusco M. Jacques Bertrand Mr. John Binns Mme Louise Blais-Leroux Mr. Sean Capstick Mr. T. A. Tim Carnell Mr. David G. C. Clarry Mr. R. Barry Cook M. Richard Côté Mr. Donald A. Craw Mr. Darren Cross Mr. Geraldo da Silva Maia Mr. Askok Dalvi Mr. George E. Davies Mr. Donald O. Downing, FCIM Mr. Kenneth Eade Mr. Ivan C. Edwards Mr. Jean Fortin Mr. Peter L. Fowler Mr. Rock R. Gagnon Mrs. Lilly Goetting Mr. R. Michael Gray Mr. R. John Haflidson Mr. Allan E. Hall Mr. Patrick J. Hannon, FCIM Mr. Wayne Hickey, FCIM Mr. Stanley Hodgson Mr. Lu Verne E. W. Hogg Mr. George E. Holmes Mr. Lionel Hurst Mr. Douglas F. Irving Mr. Kevin T. James Mr. Orest Kalawsky

Mr. George R. Kent Mr. Robert M. Kirkwood Mr. Lean Knox Mr. Sergey Krylov Mr. André Lachapelle M. Real J. Lafleur Mr. Malcolm J. Lake Lakeland Consulting Inc. Mr. Maurice Lauzon Mr. Frank J. Lewis Mr. Arthur L. Liberman Mr. Peter Lind Mr. Michael Joseph Lo Mr. Kee Yan Kelvin Luk Mr. Howard J. Lutley, FCIM Mr. A. Roy MacLean, FCIM Mr. Jan Werner Matousek Mr. Christopher Marmont Mr. John L. Maton Mr. Arthur B. Mawer Mr. Donald McKay MineTech Int’l Limited Mr. Prakash C. Mullick Mr. A. Hamid Mumim Mr. Donald I. Nelson Mr. John K. Nixon Mr. William Norquist Mr. Brian J. Paul Mr. Nicholas Parchewsky Mr. Anthony Petrina Mr. Ernest O. Pitschel Mr. Brian Rausch Mr. John Eric Rudkin Mr. David Mark Richards Rocking Horse Energy Services Inc. Mr. Julio Solano Saez Mr. Michael Samuels Mr. Wolfgang D. Skublak Mr. Kerry A. Shaw Mr. Mayooran Somanathan Mr. Merv H. Spady Mr. Harold R. Steacy Mr. Michael P. Sudbury Mr. Ronald Sweeting Mr. Frederick Sveison M. Francisco Javier Tavera-Miranda Mr. Alan Taylor Mr. Robert E. Van Tassel Town of Labrador City M. Gilles A. Tremblay Mr. W.A. Trythall Mr. Douglas G. VanDerVeer Mr. Dennis H. Waddington Mr. Jack R. O. Walli Mr. R. Lane White Mr. Howard J. Wiggett Mr. J. D. Wilkins Dr. Paul Francis Wilkinson Mr. James Gerald Willan Mr. Helmut H. Wober Mr. Umetaro Yamaguchi

TECHNICAL ABSTRACTS

CIM

journal

In situ monitoring of cemented paste backfill pressure to increase backfilling efficiency B. D. Thompson, M. W. Grabinsky and W. F. Bawden, University of Toronto, Toronto, Ontario

ABSTRACT Use of cemented paste backfill (CPB) offers economic and environmental advantages over other backfill methods. However, many operations have limited knowledge of how their CPB behaves in situ. Therefore, to avoid over-pressuring containment barricades, backfilling strategies necessarily tend to be conservative. In situ monitoring at Barrick Gold Corporation’s Williams mine and Inmet Mining Corporation’s Cayeli mine has been conducted and factors controlling barricade pressures are demonstrated, including rise rates, binder content, stope geometry, and tailings properties. The application of barricade pressure monitoring on a stope-by-stope basis can increase backfilling efficiency and, thus, reduce stope cycle times, while maintaining optimal safety. RÉSUMÉ L’utilisation de remblai en pâte cimenté (RPC) offre des avantages économiques et environnementaux par rapport aux autres méthodes de remblai. Toutefois, de nombreuses exploitations connaissent peu le comportement in situ de leur RPC. Donc, pour éviter de mettre trop de pression sur les barrières de confinement, les stratégies de remblayage tendent à être conservatrices. Un suivi in situ à la mine Williams de la Société aurifère Barrick et à la mine Cayeli de la Corporation minière Inmet a été effectué et les facteurs contrôlant les pressions sur les barrières de confinement sont identifiés, incluant les taux d’édification, la proportion de liant, la géométrie du chantier et les propriétés des résidus utilisés. La mise en œuvre du suivi, chantier par chantier, des pressions sur les barricades peut accroître l’efficacité du remblayage et ainsi, réduire le temps de cycle des chantiers tout en maintenant une sécurité optimale.

Beneficiation of concentrated ultrafine suspensions with a Falcon UF concentrator J.-S. Kroll-Rabotin, University of Alberta, Department of Chemical and Material Engineering, Pipeline Transport Processes Research Group, Edmonton, Alberta, F. Bourgeois, Université de Toulouse, INPT, UPS, Laboratoire de Génie Chimique, France; CNRS, Fédération de recherché Fermat, Toulouse, France, É. Climent, Université de Toulouse, INPT, UPS, Laboratoire de Génie Chimique, France; CNRS, Fédération de recherché Fermat, Toulouse, France

Towards formalizing qualitative operations input into mine planning E. Lampard, Alberta Equipment–Ground Interactions Syndicate (AEGIS), University of Alberta, Edmonton, Alberta

ABSTRACT Falcon concentrators are enhanced gravity separators designed for concentrating fine particles. The Falcon UF model is unique in that it is dedicated to beneficiation of ultrafines, one key feature being that it does not make use of any fluidization water. We investigated the physics of particle transport inside Falcon concentrators, and concluded that separation efficiency is governed by differential settling velocity. We derived and published a predictive model of the partition function under dilute conditions. We intend to extend the initial model to concentrated ultrafine suspensions for application to industrial scenarios, by adding hindered settling to account for solid concentration effects. RÉSUMÉ Les concentrateurs Falcon sont des séparateurs gravimétriques améliorés conçus pour concentrer les particules fines. Le modèle Falcon UF est unique en ce qu’il est dédié à l’enrichissement des ultrafins; une des caractéristiques clés est qu’il n’utilise pas d’eau de fluidisation. Nous avons étudié la physique du transport des particules dans les concentrateurs Falcon et nous avons conclu que l’efficacité de séparation est régie par la vitesse différentielle de sédimentation. Nous avons produit et publié un modèle prédictif de la fonction de partition sous des conditions de dilution. Nous prévoyons étendre le modèle initial à des suspensions concentrées d’ultrafins dans le but de l’appliquer à des scénarios industriels par l’ajout d’une sédimentation entravée pour tenir compte des effets de concentration des solides. ABSTRACT Surface mining operations must manage variability from within their operations, as well as variability imposed upon them by external forces. A framework to manage both internal and external variability through the continuous review and adjustment of a mine plan during active mining lifetime operation is introduced, to minimize lost production and maintain operational safety. The observational approach of “observe, evaluated, interpret, predict and adapt” is employed as the backbone of this approach. Although written with a surface mining operation in mind, the framework outlined in this paper would be equally applicable to any mining or processing operation.

RÉSUMÉ Les exploitations minières à ciel ouvert doivent gérer la variabilité inhérente à leur exploitation ainsi que la variabilité imposée par des forces externes. Un cadre pour gérer les variabilités internes et externes par la révision et l’ajustement continuels d’un plan de mine durant toute la vie active de la mine est présenté dans le but de minimiser la perte de production et maintenir la sécurité opérationnelle. Les étapes d’assertation « observer, évaluer, interpréter, prédire et adapter » constituent la base de cette méthode. Bien qu’écrit en pensant à une exploitation à ciel ouvert, le cadre décrit dans Excerpts taken from abstracts in CIM Journal, Vol. 2, No. 4. cet article pourrait être appliqué à toute exploitation Subscribe—www.cim.org minière ou de traitement.

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

TECHNICAL ABSTRACTS

canadian metallurgical quarterly On the carrying capacity limitation in large flotation cells J. B. Yianatos and F. A. Contreras, CASIM, Automation and Supervision Centre for Mining Industry, Chemical Engineering Department, Santa Maria University, Valparaiso, Chile

ABSTRACT Mineral carrying rates across the pulp-froth interface in the range of 1.43.2 tph/m2 and bubble surface coverage between 7 and 22 per cent, have been determined in large rougher flotation cells (100, 160 and 300 m3). A model for estimating the carrying rate at the pulp-froth interface as a function of bubble surface coverage, bubble surface area flux and Sauter mean particle size of the mineral collected by true flotation was developed. To evaluate these variables, measurements of bubble size distribution, bubble load and size distribution of collected particles were performed at different concentrators. The results of bubble surface coverage were significantly lower than the expected maximum coverage for the collection zone, indicating that for copper rougher flotation cells it is unlikely to achieve maximum carrying rate at the pulp-froth interface level. The main constraints regarding carrying capacity limitations at the concentrate overflow were then related to the froth transport characteristics such as froth recovery. RÉSUMÉ On a déterminé les vitesses de transport de minéral à travers l’interface pulpemousse dans la gamme de 1.4-3.2 tph/m2 et entre 7 et 22 pour cent de couverture de la surface de bulle, dans des cellules de flottation de dégrossissage de grande taille (100, 160 et 300 m3). On a développé un modèle pour estimer la vitesse de transport à l’interface pulpe-mousse en fonction de la couverture de la surface de bulle, du flux de la surface de bulle et de la taille moyenne de Sauter des particules de minéral captées par flottation véritable. Afin d’évaluer ces variables, on a effectué, à différents concentrateurs, des mesures de la distribution de la taille de bulle, de la charge de bulle et de la distribution de taille des particules captées. Les résultats de la couverture de la surface de bulle étaient significativement plus faibles que la couverture maximale attendue pour la zone de captage, indiquant que pour les cellules de flottation de dégrossissage du cuivre, il était peu probable d’obtenir la vitesse maximale de transport au niveau de l’interface pulpe-mousse. On a ensuite relié les contraintes principales ayant trait aux limitations de la capacité de transport au déversement du concentré, aux caractéristiques de transport de la mousse comme la récupération de la mousse.

Water recovery and bubble surface area flux in flotation W. Zhang, J. E. Nesset and J. A. Finch, Department of Mining and Materials Engineering, McGill University, Montreal, Quebec

ABSTRACT Frother influences water recovery through control of bubble size and a possible chemical effect. A set-up is described to give steady state water overflow rate (JWO) for four frothers spanning a range in “strength.” A mass balance on frother leaving the cell is solved to estimate the bubble surface area flux to overflow (SbO). The balance required measurement of frother concentration, performed using TOC analysis and frother adsorption density, calculated from the Gibbs adsorption isotherm using surface tension-concentration data. The SbO generally lay between the Sb estimated from measurements of bubble size into (SbI) and on top of froth (SbT). The relationship between JWO and SbO is argued to reveal the frother chemistry effect, quantified for discussion purposes by an equivalent water layer thickness. RÉSUMÉ Le moussant influence la récupération d’eau par le contrôle de la taille de bulle et par un effet chimique possible. On décrit une installation donnant une vitesse de déversement d’eau (JWO) en régime permanent de quatre moussants couvrant une gamme de « force ». On résout une balance de masse du moussant qui sort de la cellule pour estimer le flux à la surface de la bulle vers le déversement (SbO). La balance nécessitait la mesure de la concentration du moussant, effectuée en utilisant l’analyse TOC et la densité d’adsorption du moussant, calculée à partir de l’isotherme d’adsorption de Gibbs en utilisant les données de tension superficielle-concentration. Le SbO se situe généralement entre le Sb estimé à partir des mesures de la taille de bulle dans (SbI) et au-dessus (SbT) de la mousse. On soutient que la relation entre JWO et SbO révèle l’effet de la chimie du moussant, quantifié pour fin de discussion par une épaisseur équivalente de couche d’eau.

December 2011 / January 2012 | 109

TECHNICAL ABSTRACTS

canadian metallurgical quarterly Effect of dynamic bubble nucleation on bitumen flotation Z. A. Zhou, R. S. Chow, Heavy Oil and Oil Sands, Alberta Innovates – Technology Futures, Edmonton, Alberta, P. Cleyle, Extraction Department, Suncor Energy, Fort McMurray, Alberta, Z. H. Xu and J. H. Masliyah, Department of Chemical and Materials Engineering, University of Alberta, Edmonton, Alberta

ABSTRACT Bubble nucleation in water under dynamic conditions was investigated using an autoclave at an air saturation pressure of 7 atm with different operating conditions. Agitation during air saturation of water was found to be crucial in enhancing tiny bubble formation. Without agitation, virtually no bubbles nucleated on hydrophobic surfaces. More bubbles were found to nucleate on hydrophobic surfaces at a higher agitation rate due to the formation of more cavities by more intense hydrodynamic conditions. The effect of saturation temperature (20-90°C) on bubble nucleation under dynamic conditions was only marginal, which differed from static bubble nucleation where the nucleation event reduced with increasing temperature. Flotation recovery of bitumen from oil sands extraction demonstrated a significant role of tiny bubbles nucleated in water: more than a 50-170 per cent increase in bitumen recovery from different oil sands was obtained by using air supersaturated water rather than regular water. RÉSUMÉ On a étudié la nucléation de bulle dans l’eau, sous des conditions dynamiques, en utilisant un autoclave à une pression de saturation de l’air de 7 atm, à différentes conditions d’opération. On a trouvé que l’agitation lors de la saturation en air de l’eau était cruciale pour améliorer la formation de bulles minuscules. Sans agitation, virtuellement aucune bulle n’était nucléée sur les surfaces hydrophobes. On a trouvé qu’un plus grand nombre de bulles étaient nucléées sur les surfaces hydrophobes à une vitesse d’agitation plus élevée à cause de la formation d’un plus grand nombre de cavités sous l’effet des conditions hydrodynamiques plus intenses. L’effet de la température de saturation (20-90°C) sur la nucléation de bulle sous des conditions dynamiques était marginal, ce qui différait de la nucléation statique de bulle où l’événement de nucléation était réduit avec l’augmentation de la température. La récupération par flottation du bitume par extraction des sables bitumineux a démontré un rôle significatif des bulles nucléées dans l’eau : on a obtenu une augmentation de plus de 50-170 pour cent de la récupération du bitume à partir de différents sables bitumineux en utilisant de l’eau sursaturée à l’air plutôt que de l’eau régulière.

Evaluating the effect of operational changes at the Vale Inco Clarabelle Mill J. Doucet, C. Price, R. Barrette and V. Lawson, Vale Inco Limited, Clarabelle Mill, Copper Cliff, Ontario

ABSTRACT In an industrial setting, operational changes are continually introduced driven by new technologies or changing economics. Because of day-to-day variability, quantifying the impact of these changes based on metallurgical performance requires long trial periods to achieve statistically significant results. Newly developed tools and techniques have allowed for direct measurement of process variables (e.g., bubble size, gas and solid holdup). Two case studies are described where direct measurement techniques were used to evaluate a new rotor-stator mechanism and the introduction of a new frother type. Application of these methods has accelerated the evaluation of process changes and improved confidence in the results. RÉSUMÉ Dans un environnement industriel, on introduit continuellement des changements opérationnels qui sont entraînés par de nouvelles technologies ou par des changements économiques. À cause de la variabilité au jour le jour, quantifier l’impact de ces changements en se basant sur le rendement métallurgique requiert de longues périodes d’essai pour obtenir des résultats statistiquement significatifs. Des outils et des techniques nouvellement développés ont permis la mesure directe des variables de procédé (par exemple, taille de bulle, rétention de gaz et de solide). On décrit deux études de cas où l’on a utilisé des techniques de mesure directe pour évaluer un nouveau mécanisme de rotor-stator et l’introduction d’un nouveau genre de moussant. L’application de ces méthodes a accéléré l’évaluation des changements du procédé et a amélioré la confidence dans les résultats.

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

TECHNICAL ABSTRACTS

canadian metallurgical quarterly Frother analysis in industrial flotation cells A. Zangooi, C. O. Gomez and J. A. Finch, Department of Mining and Materials Engineering, McGill University, Montreal

ABSTRACT Flotation is a separation process based on the collection of particles on the surface of bubbles. Flotation machines disperse air into bubbles using a variety of techniques. A previously developed colorimetric technique was refined to increase analysis rate and reproducibility, particularly for low-solubility frothers. The refined technique has been demonstrated to be robust, reliable and accurate. The refinements are briefly discussed and documented. This paper focuses on applications of the technique in operations such as frother remnant levels in recycle water, reliability of frother delivery and frother dissolution and in support of research interests related to gas dispersion and characterization of frother partitioning. RÉSUMÉ La flottation est un procédé de séparation basé sur la collecte de particules à la surface des bulles. Les appareils de flottation dispersent de l’air sous forme de bulles au moyen de techniques variées. On a raffiné une technique colorimétrique, développée auparavant, pour augmenter la vitesse d’analyse et la reproductibilité, particulièrement pour les moussants à faible solubilité. On a démontré que la technique raffinée était robuste, fiable et précise. On discute brièvement des raffinements et on les documente. Cet article se concentre sur les applications de la technique dans les opérations comme les niveaux du reste de moussant dans l’eau de recyclage, la fiabilité de la livraison du moussant et de sa dissolution et sur le soutien des intérêts de recherche reliés à la dispersion de gaz et à la caractérisation du partitionnement du moussant.

A new approach to classification of flotation collectors J. S. Laskowski, NB Keevil Institute of Mining Engineering, The University of British Columbia, Vancouver, British Columbia

ABSTRACT A collector is needed at the point of particle to bubble attachment and can be brought to this point either on the surface of particles, bubbles or both. The rational classification of flotation collectors based on observations is presented in this paper. The analysis of the accompanying phenomena leads to the conclusion that in all these mechanisms a very important and not always recognized part is played by the surface of bubbles. The role of bubbles in transportation of collectors to the point of particle-to-bubble attachment is especially important for the two types of water-insoluble collectors: oily hydrocarbons and long-chain amphipathic compounds. RÉSUMÉ On a besoin d’un collecteur au point d’attachement entre la particule et la bulle et on peut l’amener à ce point soit à la surface des particules, des bulles ou des deux. Dans cet article, on présente la classification rationnelle des collecteurs de flottation en se basant sur des observations. Grâce à l’analyse des phénomènes d’accompagnement, on peut conclure que, dans tous ces mécanismes, une partie très importante et pas toujours reconnue se joue à la surface des bulles. Le rôle des bulles dans le transport des collecteurs vers le point d’attachement particule à bulle est particulièrement important pour les deux types de collecteurs insolubles dans l’eau : les hydrocarbures huileux et les composés bipolaires à longue chaîne.

Point of zero charge, isoelectric point and aggregation of phyllosilicate minerals M. Alvarez-Silva, M. Mirnezami, Department of Mining and Materials Engineering, McGill University, Quebec, A. Uribe-Salas, Centro de Investigación y de Estudios Avanzados del IPN, Unidad Saltillo, Coah, Mexico, and J. A. Finch, Department of Mining and Materials Engineering, McGill University, Quebec

ABSTRACT Point of zero charge (p.z.c.) and isoelectric point (i.e.p.) values for chlorite (clinochlore) and serpentine (lizardite) were measured using the Mular-Roberts (M-R) titration technique and electrophoretic mobility, respectively. For chlorite and serpentine, respectively, the p.z.c. was pH 4.6 and 4.3, and the i.e.p. was at pH <3 and 3.3. Aggregation was gauged from settling tests adapted to small samples. This showed maximum aggregation for chlorite was around pH 3, i.e., close to the i.e.p., while serpentine did not show a conclusive maximum. Some implications in flotation are discussed.

RÉSUMÉ On a mesuré les valeurs du point de charge nulle (p.z.c.) et du point isoélectrique (i.e.p.) pour le chlorite (clinochlore) et la serpentine (lizardite) en utilisant la technique de titrage de MularRoberts (M-R) et la mobilité électrophorétique, respectivement. Le p.z.c. se trouvait au pH 4.6 et 4.3 respectivement, pour le chlorite et la serpentine et le i.e.p. était au pH <3 et 3.3. On a calibré l’agrégation à partir d’essais de sédimentation adaptés à de petits échantillons. Ceci a montré que l’agrégation maximale pour le chlorite était autour du pH 3, près du i.e.p., alors que la serpentine n’a pas montré Excerpts taken from abstracts in CMQ, Vol. 49, No. 4. de maximum conclusif. On discute de certaines implicaSubscribe—www.cmq-online.ca tions pour la flottation.

December 2011 / January 2012 | 111

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voices from industry

The rise of resource nationalism and its implications for Canada By Fred McMahon, vice-president of international research with the Fraser Institute, and Jean-François Minardi, associate director of the Global Natural Resource Policy Centre with the Fraser Institute

esource nationalism – the tendency of governments to take a bigger slice of the money to be made from their states’ resources – is a global trend that is manifesting itself across the industry, and it may have major repercussions for Canadian mining companies operating at home and abroad. This trend was recently identified in an Ernst & Young Report as the top strategic business risk in the mining and metals sector in 2011. The industrialization and urbanization of China, India and other emerging countries are at the source of a soaring demand for commodities, which suppliers are struggling to meet. This has caused prices to treble in the past decade, according to The Economist’s index of non-oil commodity prices. While high mineral prices are good for the industry, higher profits also raise the covetousness of governments that are trying to increase their share of the windfall generated by their natural resources through higher taxes, royalties or even through nationalization and indigenization. We see this around the globe. In Australia, a pending new mining tax law will be introduced on July 1, 2012. The tax on mining companies’ profits on iron ore and coal is expected to be spent on pensions and tax cuts for small companies. In Peru, the new government of Ollanta Humala has implemented a new tax that will apply to operating profits, rather than revenues, the rate being scaled according to how high the company’s margins are. In Zambia, Africa’s largest copper producer, the recently elected government is going to double royalties from three to six per cent on copper mines. Meanwhile, in Chile, there are expectations that taxes or mining royalties will be raised by a centre-right government under pressure to invest in education. But tax/royalty increases are not the only manifestations of resource nationalism. In some countries, governments are trying to

R Fred McMahon

Jean-François Minardi

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

renegotiate the terms of contracts with mining companies, increase state-owned companies’ participation in mining projects or even nationalize mining. Recently, Vale and Rio Tinto had to cede up to 35 per cent of their iron ore projects to the government of Guinea. In Zimbabwe, the mining sector is threatened by the indigenization law passed in 2007, which states that foreign and white-owned companies must sell 51 per cent of their shares to indigenous Zimbabweans. In Venezuela, Hugo Chávez announced last August that he will nationalize the country’s gold industry. The debate over nationalization of the mining industry in South Africa contributes to a high level of uncertainty that delays investment decisions and scares away investors. Even Canada is not immune to resource nationalism. In Quebec, the Parti Québécois – the official opposition – says that Quebecers must regain control over their natural resources. Citing Australia as a model, they have called for higher royalties, even though they were already increased from 12 per cent of annual profits in 2010 to 15 per cent in 2011, and will reach 16 per cent in 2012. They mention the rising price of minerals as a reason to increase the government’s share of mining revenue. Resource nationalism will also affect Canadian companies operating abroad. The Canadian mining sector already has a strong external investment presence and the high demand for mining products will probably persuade Canadian mining companies to invest more in developing countries where the temptation for resource nationalism is strong. As long as mineral prices remain high, resource nationalism will play an important role in both developing and developed countries. It will create a high level of uncertainty and complexity for investors who will have to live with – or find a way to manage – a higher level of risk. CIM

aboriginal perspectives | COLUMNS

Banding together for a better future Ring of Fire First Nations sign Unity Declaration Alexandra Lopez-Pacheco

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Treading new territory A Canadian company’s foray onto the international scene Heather Ednie

Kal Tire archive

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Adventures in paradise A nickel company’s number cruncher trades his Montreal office for a life in the South Pacific

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| HR outlook

Full steam ahead MiHR Council prepares for the coming year

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author

Ryan Montpellier is the executive director of MiHR. Currently, he sits on a number of boards and provincial committees dealing with labour shortages in the mining sector.

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GIVING BACK

December 2011 / January 2012 | 77

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| metals monitor

Drilling activity continues to keep MEG’s PAI afloat despite rattled markets The staff of Metals Economics Group

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Room for improvement Survey targets rough patches on the road to safety performance Heather Ednie

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Incidents by cause at mineral exploration sites in Canada in 2009.

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December 2011 / January 2012 | 81

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MOVING ON UP Ann Marie Hann became the new president of the Coal Association of Canada. She made the switch after a career in government service and at the Propane Gas Association of Canada.

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| women in mining

Hot off the press Miner shines bright light on the industry with a new book series Heather Ednie

Changing the industry’s image, one book at a time All those years, Brannan was unaware she was gaining inspiration for her career as a writer. Through her passion