CIM Magazine May 2017 by CIM-ICM Publications

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Courtesy of Newmont Mining Corporation

MAY 2017 | MAI 2017

cover story

The carbon conundrum The global strategy for reducing carbon emissions currently hinges on some sort of carbon pricing scheme. But will that really mitigate emissions or just pass the buck? By Peter Braul

60 The power of patience

64 Hard rock revolution on the horizon

Dundee Precious Metalsâ&#x20AC;&#x2122; Krumovgrad mine is a project in building trust

Continuous mining machines on the verge of a breakthrough in hard rock operations

By Eavan Moore

By Alexandra Lopez-Pacheco

May 2017 â&#x20AC;˘ Mai 2017 | 5

CIM MAGAZINE MAY 2017 | MAI 2017

in each issue

8 10 12

Editor’s letter President’s notes Chatter

tools of the trade

The best in new technology Compiled by David Meffe & Kylie Williams

developments

Federal budget includes investments in clean technology, innovation and junior exploration

By Cecilia Keating

Disastrous 1992 Nova Scotia mine explosion spurred legislative changes that critics argue need to be better enforced

mining lore

By David Meffe

University of British Columbia researchers conduct carbon sequestration study at Hard Creek Nickel’s Turnagain property

Before President Nixon unhitched the U.S. dollar from the price of gold, the metal spent 2,000 years at the heart of global monetary systems By Cecilia Keating

By Joel Barde

contenu francophone

columns

By Bill Lewis

Zero harm — It can be done! By Vic Pakalnis

69 70

Don’t get bogged down in the details

Between a rock and a hard place

genomics UBC research aims to remediate problematic oil sands process water By Tom DiNardo

Counting every species at a mine site can give you a true gauge of ecosystem health

Lettre de l’éditeur | Mot du président

article de fond

By Rick Stapenhurst

Table des matières

L’énigme du Co2 Le modèle actuel de tarification du carbone constitue-t-il la meilleure solution pour l’avenir? Par Peter Braul

Le pouvoir de la patience La mine Dundee Precious Metals de Krumovgrad est un projet basé sur la confiance Par Eavan Moore

By Peter Braul

Changes in soil bacteria could help locate mineral deposits By Christopher Pollon

6 | CIM Magazine | Vol. 12, No. 3

La version française intégrale du CIM Magazine est disponible en ligne : magazine.CIM.org/fr-CA

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editor’s letter

The environmental tightrope aught up in a crisis of his administration’s own making, President Ronald Reagan offered William Ruckelshaus, the original head of the Environmental Protection Agency, his old job again in 1983. In the preceding years, the EPA had lost its rudder. The administrator responsible for managing the Superfund for environmental cleanup had been sent to jail, and the public had lost faith in the federal regulator. One of Ruckelshaus’ first meetings after he accepted the job was with members of the chemicals industry. Rather than push him to ease regulations, they urged him to step up enforcement and restore the EPA’s credibility among the public. Such regulation only functions properly in the tension between industry, government and the public. Too much slack from any one direction throws everything off balance. Earlier this spring, lawmakers in El Salvador, where 90 per cent of the surface water is considered contaminated due to agricultural runoff and untreated sewage, voted to make the country a mining-free territory, the only nation in the world to impose such a ban.

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This issue’s cover The Copper Mountain mine in southcentral British Columbia Courtesy of Copper Mountain Mining Corporation

Be st

ia ed

Finalist

While the Salvadoran rallying cry of “No to mining, yes to life” might raise the hackles of proud miners, it speaks more to the lack of good governance there. Thankfully, in this country the challenge has not been reduced to a life or death proposition, and many are invested in ensuring it does not degenerate to that point. After consultations across Canada, the Ministry of Environment and Climate Change’s expert panel released its review of federal environmental assessment processes in early April. “In general,” the panel reported, “we did not hear strident opposition to the development of projects, although in a few cases there were those who held that certain projects should not have gone ahead.” While the details of the process, now christened an “Impact Assessment”, still need to be hammered out, which will no doubt include some measure of frustration, at first blush it seems we have the enviable advantage of a well-balanced first step.

Editor-in-chief Ryan Bergen, rbergen@cim.org Executive editor Angela Hamlyn, ahamlyn@cim.org Managing editor Andrea Nichiporuk, anichiporuk@cim.org Section editors Tom DiNardo, tdinardo@cim.org; Kelsey Rolfe, krolfe@cim.org Copy editor Marilena Lucci, mlucci@cim.org Web content editor Maria Olaguera, molaguera@cim.org Contributing editor Eavan Moore, emoore@cim.org Editorial intern David Meffe Digitization technician Marie-Ève Lapierre, melapierre@cim.org Contributors Joel Barde, Peter Braul, Sahar Fatima, Cecilia Keating, Bill Lewis, Alexandra Lopez-Pacheco, Eavan Moore, Vic Pakalnis, Christopher Pollon, Rick Stapenhurst, Kylie Williams Editorial advisory board Alicia Ferdinand, Mohammad Babaei Khorzhoughi, Vic Pakalnis, Steve Rusk, Nathan Stubina Translations CNW, Karen Rolland Published 8 times a year by: Canadian Institute of Mining, Metallurgy and Petroleum 1250 – 3500 de Maisonneuve Blvd. West Westmount, QC H3Z 3C1 Tel.: 514.939.2710; Fax: 514.939.2714 www.cim.org; magazine@cim.org

Ryan Bergen, Editor-in-chief editor@cim.org @Ryan_CIM_Mag

Advertising sales Dovetail Communications Inc. Tel.: 905.886.6640; Fax: 905.886.6615; www.dvtail.com Senior Account Executives Janet Jeffery, jjeffery@dvtail.com, 905.707.3529 Neal Young, nyoung@dvtail.com, 905.707.3525 Subscriptions Online version included in CIM Membership ($197/yr). Print version for institutions or agencies – Canada: $275/yr (AB, BC, MB, NT, NU, SK, YT add 5% GST; ON add 13% HST; QC add 5% GST + 9.975% PST; NB, NL, NS, PE add 15% HST). Print version for institutions or agencies – USA/International: US$325/yr. Online access to single copy: $50. Layout and design by Clò Communications Inc. www.clocommunications.com Copyright©2017. 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.

adian Busines sM Can in

Printed in Canada 8 | CIM Magazine | Vol. 12, No. 3

Together, we’ll move mountains.

In the mining business, downtime is the enemy. Mobil™ offers three ways to fight it: lubricants that withstand extreme conditions, services that help optimize equipment reliability, and industry expertise that covers decades. Learn more at mobil.ca/industrial. Visit us at the CIM Conference, booth #915.

president’s notes

The future of mining

“Leadership will need to have a well-developed response when they are asked by the workforce, ‘What’s in it for me?’ ”

Speaking to future trends in mining is much like predicting future gold prices: It’s a mug’s game. At a CIM conference in Toronto in 1991, a miner operated an LHD in Sudbury from the Royal York Hotel lobby. Here we are a quarter century later and that technology is only just starting to gain some traction. I can also recall when Inco proclaimed Crean Hill the all-electric mine of the future. I was the last mine manager of that property when miners operating diesel equipment got the final ore at depth, the tethered electric vehicles having been abandoned after proving impractical. The majors of the day, Falconbridge, Noranda and Inco, put lots of money into mining research, but the gains fell short of the lofty predictions. Today, the future mining talk is around ideas such as automation, battery power, continuous mining, microgrid, renewable energy, digitization and big data. It will be interesting to see where the major gains are and where the niches will be. Where will the new leaders come from; big or small mining companies, equipment suppliers, Silicon Valley companies, research organizations, universities, government or startups? Will the technologies that actually get widespread adoption arise from “clusters of excellence” where innovation efforts are made in cooperation? Is Intellectual property dead in the mining industry, as leaders such as Anglo American CEO Mark Cutifani have projected? What is the future for women and other underrepresented groups in mining? Can we expect any social innovation in mining? Such questions have left experts on future-of-mining panels tap dancing for an appropriate response. It strikes me that the mining industry is often tradition-bound in the “drill, blast and muck” phase as the people side of technology implementation is often not well thought through. For new technologies to take root, leadership will need to have a well-developed response when they are asked by the workforce, “What’s in it for me?” Together we have succeeded in answering that question for safety. Our industry has become one of the safest. So there is clear evidence that when our values and efforts are aligned with all stakeholders, the mining industry can accomplish great things!

Michael Winship CIM President @CIMPrez

10 | CIM Magazine | Vol. 12, No. 3

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Visit F LSmid th soluti o n s ex perts at CIM Booth #2118

chatter

RYAN BERGEN @Ryan_CIM_Mag

ANGELA HAMLYN @AngelaH_CIM

RE: SENSOR-BASED ORE SORTING - MCEWEN MINING LUNCH AND LEARN SERIES

Hayley Halsall-Whitney You can definitely see a big difference in mineral processing performance when the variability in head grade is minimized and stable. Would be great to have the ability to reduce variation through the use of ore sorting technology instead of asking your loader operator to go by the weight of the bucket. Glad to see this technology advancing!

ANDREA NICHIPORUK @Andrea_CIM_Mag

TOM DiNARDO @Tom_CIM_Mag

RE: FULLY LOADED (DEC ‘16/JAN ‘17)

Sean McGinn There was a very similar technology developed by Noranda Technology Centre in the late '90s early '00s. It was called Autoloading and patented just ahead of CAT's Autodig technology at the time. Technology was transferred to a commercial partner SIAMTech but never caught on, Atlas Copco was looking to partner the technology but it never came about. I ran a Six Sigma project at the end of development and beginning of commercialisation while working for Noranda to prove the commercial viability and business case which was very successful. Despite all that it still never moved ahead and got dropped off. Great to see that this has come back and will hopefully become an accepted and standard tool for underground mining. The power of technology and acceptance of change has moved much further ahead in twenty years thankfully. Nick Hynd The software upgrade from Atlas Copco may prove valuable for all Atlas Copco LHD owners.

KELSEY ROLFE @kelseyarolfe

MARIA OLAGUERA @Maria_CIM_Mag

WHAT WE’VE BEEN UP TO

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@cim_mag Editor Ryan Bergen rocking the #hololens at the #DisruptMining innovation expo at @the_pdac, where the contest's semifinalists showcased the technologies and processes they hope will change the mining sector.

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@cim_mag Editor @kelseyarolfe took a virtual tour of the new K+S Legacy #potash mine in Saskatchewan. Thanks to the fine folks at @amec_fw for use of the VR headset.

CIM Magazine was at PDAC 2017 in March. Follow us on Instagram @cim_mag to see more from the convention, other field adventures and the mining stories you should be following. 12 | CIM Magazine | Vol. 12, No. 3

YOUTUBE youtube.com/canadianinstituteofmining

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Courtesy of MacLean Engineering

tools of the trade

Here comes the boom It is the great divide of underground mining vehicles: hefty loads or high reach? MacLean Engineering heard the query and asked another: why not both? The company’s new LR3 Boom Lift offers an innovative solution for elevated work platform needs in high-back mines, integrating heavy-load and high-lift capabilities. Though originally designed for Australian high-back mines, this tech from Down Under is making a return to Canada for use in hard rock regions. “In North America, with the introduction of some new 50-, 60- and 65-tonne trucks, heading sizes are getting larger, which puts them out of the traditional range of a scissor lift reach,” said Dan Stern, product manager at MacLean. “This isn’t a replacement for scissor lifts, but this is designed for mines with large heading sizes where the basket might need to be in some awkward positions.” The unit has a lifting capacity of up to four tonnes, a six-metre deck, a boom swing of plus or minus 15 degrees and deck swing ranges of plus or minus 30 degrees, along with interchangeable baskets and quick-change deck configurations to suit the application. This vehicle is versatile enough to perform a wide range of mine support functions while providing coverage from ground level up to a height of eight metres. – David Meffe

From the ground to the cloud The downturn has driven the industry to develop costeffective approaches to collecting, managing and sharing drill and sample data. MX Deposit, a cloud-based drilling data management solution by Minalytix and Geosoft, is designed to track, validate and audit the full range of data types collected on a project. Steve Randall, vice-president of marketing at Geosoft, said the cloud-based model means companies spend less on information technology infrastructure and database administration. “Using the subscription model, MX Deposit is quick to implement and is scalable as projects grow,” he said. “Data can be logged and accessed from anywhere, and a mobile data entry application is available for more efficient data collection in the field.” Launched in January, MX Deposit has built-in additions including an activity feed to centralize communication between team members and encourage collaboration. “A lot of experience leaves the industry during the downturn, so as things start up again, the ability to use technology for collaboration will help companies capture and use their experience where it’s needed,” Randall said. – Kylie Williams

More wear, less tear

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u Co of FL h idt

14 | CIM Magazine | Vol. 12, No. 3

Moving rocks is tough work. Wear liners are designed to absorb shock and take the brunt of abuse caused by ferrying ore from station to station, and every production hour gained from their durability avoids bottlenecks and replacement costs. FLSmith’s new FerroCer Impact wear liners offer a new design that is lighter, easier to replace and promises to increase resistance up to fifteen fold compared to competitors. “There’s a unique matrix design with the FerroCer, and it utilizes the strength and malleability of steel, and the abrasion-resistivity of ceramics. Those three components create a patent-pending product that’s second to none right now,” said Brent Stokes, vice-president for product line management consumables at FLSmith. The design also enables the remaining wear life of the ceramic inserts to be visually assessed and individually replaced.– David Meffe

Convert to Montabert for proven benefits

High-performance Montabert drifters are proven to provide up to 60% overall savings on unit operating costs due to the longer maintenance intervals, lower costs per repair and reduced consumable consumption. Proven benefits include:

• increasing drill bit life by up to 47% • increasing shank life by up to 60% • decreasing noise and vibration levels to enhance the operator environment Montabert drifters are compatible with most OEM applications and conversions are available at any of Joy Global’s service facilities worldwide. Learn more at JoyGlobal.com

Join us April 30–May 3, Booth #1501

Courtesy of iHandover

Courtesy of Wajax

tools of the trade

Fresh wheels hit the dirt Handovers made handy The logistics of coordinating fly-in-fly-out (FIFO) and drive-indrive-out (DIDO) handovers at mine sites, specifically in remote locations, can become messy with large work forces and alternating schedules. iHandover’s Relay software takes manual and written handover timetables and uses smart mobile technology to render them digital and provide updates in realtime, saving hours of wasted time per FIFO swing. This can add up to hundreds of work hours saved per FIFO swing employee per year by addressing handovers between incoming and outgoing employees. “It’s a big step forward in how teams working at these locations communicate and manage tasks in real-time across the business,” said Ross McDowell, founder and CEO of iHandover, noting that a new upgrade launched in May allows for a same-day handover. “This extends Relay’s product offering to users and managers at non-stop operations working on day/night shift working patterns. Our market will no longer be dependent on a remote or mobile place of work as our product will be able to cater for handover at any mine.” The company will also launch an online software for small teams of one manager and six professionals this summer. – David Meffe

The functions and benefits of wheel loaders are application-specific, and vary drastically across regions and industries. Hitachi’s new wheel loader line offers versatile and dependable products supported by Wajax’s coast-tocoast dealer network. “In a marketplace where some manufacturers are cutting structural steel weight to save cost, and adding additional counterweight to maintain bucket capacity standards, Hitachi has stayed true to a manufacturing philosophy that is focused on building a strong loader foundation with heavy duty chassis and center hinge, strong powertrain components, and efficient hydraulic systems,” said David Thompson McKie, product application specialist with Wajax. Features like the traction enhancement system on utility loaders and dig assist on the mid-size and production models address needs to reduce fuel consumption, limit excessive tire and driveline wear when loading, and ensure that the necessary hydraulics are being driven to the loader and bucket functions to support productive fill factors. The new wheel loaders range in capacity from the ZW50 at 0.75 cubic yards to the ZW550-5 at nine cubic yards, supporting a variety of applications in the oil and gas and mining industries. – David Meffe

Courtesy of Boart Longyear

FREEDOM in drilling Surface coring and drilling can be costly and time-consuming without the right equipment. Boart Longyear’s new FL262 FREEDOM Loader allows for hands-free rod handling when used in conjuncture with their LF160 or LF350 surface coring drill rigs. While onboard rod storage is perfect for drilling shallow depth holes, the mechanized system loads new rods from an auxiliary source onto the rig for deeper exploration. “So it cuts out the process of having to manually load a cartridge or move rods onto the machine to be loaded onto the rig. We can do it completely mechanically with the rod arm, directly from a truck, onto the loader, and then onto the machine,” said Zac Strauss, global product manager with Boart Longyear. “Because we’ve optimized the drill rig configuration and the loader around the rod handling process, we’ve removed several steps that are required to make and break joints, and trip rods in and out of the hole.” This allows for increased efficiency and speed, while remote radio controls allow drill operators to maintain a safe distance. – David Meffe 16 | CIM Magazine | Vol. 12, No. 3

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Canadian miners getting squeezed as Mexican royalties regime fails to deliver

Disastrous 1992 Westray mine explosion spurred legislative changes critics argue need to be better enforced

Goldcorp and IBM Canada launch Watson artificial intelligence project at Red Lake

UBC researchers conduct carbon sequestration study at Hard Creek Nickel’s Turnagain project

Developments Turning point Federal budget includes investments in clean technology, innovation and junior exploration

Canada’s leading mining and minerals associations welcomed initiatives outlined in the federal budget, delivered on March 22 by finance minister Bill Morneau. These include a one-year extension of the Mineral Exploration Tax Credit (METC) with its flowthrough share mechanism intact, pledges for infrastructure in remote northern areas, and continued support for skills and employment training for indigenous Canadians. Budget 2017’s policies are a “potential turning point” for an industry marred in recent years by a loss of competitive edge when it comes to mineral investment, according to Brendan Marshall, vice-president for economic and northern affairs at the Mining Association of Canada (MAC). However, he said much depends on “the shape [these programs] take” and hopes the specifics, eligibilities and mechanisms of the funds will be outlined as quickly as possible. In particular, MAC would like to see the government elaborate on infrastructure promises set out in the budget, which include the establishment of a new Canada Infrastructure Bank. MAC is hopeful that the bank, which promises $35 billion over 11 years in transit plans, transportation networks and electricity grids, will specifically address and alleviate the 18 | CIM Magazine | Vol. 12, No. 3

Courtesy of the Office of the Prime Minister of Canada

By Cecilia Keating

Finance Minister Bill Morneau delivered the federal budget on March 22, which included the long-promised Canada Infrastructure Bank to fund transit plans, transportation networks and electricity grids.

challenges mining companies face in remote and northern areas. Prospectors and Developers Association of Canada (PDAC) president Glenn Mullan said he also hopes the infrastructure bank will help “unlock the resource potential” of remote areas. PDAC’s figures show that the costs to develop and explore in northern and remote Canada are, on average, 227 per cent higher than non-remote projects, sometimes soaring to 600 per cent more.

A key victory for exploration companies across the country is the extension of the METC for another year. Gavin Dirom, outgoing president of Association for Mineral Exploration British Columbia (AME BC), said the decision to extend the tax credit shows “a level of support and understanding” for the mineral exploration sector. He said he is hopeful it will help “restore Canada’s place as the top destination for investment and mineral exploration.”

The METC is a 15 per cent nonrefundable tax credit which incentivizes investment in junior exploration companies. Its flow-through shares mechanism allows companies to transfer expenses associated with exploration activities to investors, who can deduct the expenses in calculating their own taxable income. Major discoveries at the Ekati and Diavik diamond mines in the Northwest Territories, the Voisey’s Bay nickel mine in Labrador, and the Éleonore gold mine in James Bay were all made with flow-through-shares financing. The budget has a heavy focus on innovation, including the establishment of a new platform called ‘Innovation Canada,’ which will co-ordinate and simplify support available to Canadian entrepreneurs and review current innovation programs, including those at Natural Resources Canada (NRCan). The scheme will benefit from $950 million over five years.

Over four years $200 million will be allocated to NRCan and the departments of Agriculture and Fisheries and Oceans to invest in clean technologies being developed by industry, academia and federal labs. NRCan spokesperson Roxanna Coulon said that investments in the mining sector will focus on innovations and clean technologies that will ensure “mineral resources are developed sustainably while strengthening our competitive advantage.” According to MAC, the mining industry has historically felt under-represented in the Canadian innovation, research and development (R&D) ecosystem relative to its economic contribution. The association therefore hopes that the Canadian Mining Innovation Council (CMIC) will be a recipient of the proposed funding for innovation and R&D. CMIC is a collaboration between industry leaders, including MAC members, government and academics which aims to stimulate

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technological innovation that will transform mining into a zero-waste industry over 10 to 20 years. Mining is Canada’s leading private sector employer of indigenous people and MAC, PDAC and AME BC were in agreement that the budget’s $50 million investment into the Aboriginal Skills and Employment Training Strategy (ASETS) program bodes well for the sector. PDAC’s Mullan added the boost may also enhance indigenous participation by “breaking down some of the barriers that inhibit more active participation.” The $50 million figure designated for ASETS is in part recycled from preexisting funds. It incorporates $15 million earmarked for the same program over two years in Budget 2016, plus funds re-allocated from other skillstraining programs. The government also outlined its intent to have carbon pricing in place across the country by 2018. Provinces and territories will choose between a

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developments direct price on carbon pollution and a cap-and-trade system. While Marshall said that MAC supports the move “in principle,” he thinks the government should ensure that emissions-intensive industries are “protected” and do not bear the carbon price in a “punitive way.” Other areas of note for miners in the budget include funding for work-

integrated learning programs for post-secondary students enrolled in science, technology, engineering, mathematics and business programs, a $50-million commitment to establish a Canadian Centre on Transportation Data and an associated open data portal which will serve as an authoritative source of transportation data designed to move goods more efficiently across

supply and distribution chains. A National Trade Corridors Fund will address congestion in the transportation supply chain and is aimed to unlock economic development in the territories and improve the flow of supplies to their most northern communities. The government also earmarked $30 million for remediating orphaned oil and gas wells in Alberta. CIM

CIM MAGAZINE EXCLUSIVE

Risk factor Canadian miners getting squeezed as Mexican royalties regime fails to deliver

Tensions continue to simmer on the part of Canadian mining companies operating in Mexico, largely over the reallocation of special taxes levied on the extractive sector in 2014 by President Enrique Peña Nieto’s government. Mexico’s Mining Fund was established in January 2014 with the aim of improving the living standards of communities near mine sites, financing a range of infrastructure projects including construction of schools and roads, and the preservation of drinking water and natural areas. The Special Mining Tax applies a 7.5 per cent royalty or tax rate to profits generated by the sales of extractive activities, while the Extraordinary Mining Tax tacks on an additional 0.5 per cent on gross earnings obtained from the sale of gold, silver and platinum. From these new taxes, certain amounts are supposed to be earmarked for reinvestment back into local communities, with 40 per cent going to the mining municipality, 40 per cent to the state government, and 20 per cent to the federal government. According to Natural Resources Canada, the fund collected MXN$2.1 billion in 2014 and MXN$2.2 billion in 2015 (latest statistics available). Yet, there is little evidence this sum has reached local mining communities, causing anxiety and tensions between Canadian firms and the locals living near their operations.

Courtesy of Goldcorp

By David Meffe

The funds from Mexico’s Special Mining Tax and Extraordinary Mining Tax have been “extremely slow” reaching local communities, Harvey said, reducing local employment and limiting miners’ community investment.

“So far, none of that money collected, and we’re talking about millions of dollars, has made its way back to the community. And this is creating problems for the companies, in that these communities are anxious and angry,” said Pierre Gratton, president and CEO of the Mining Association of Canada. “Some Canadian companies have been facing protests from communities

demanding their royalties, which have already been paid. They protest in the region to try and use these companies to leverage the government. Often, to bring the blockades down, companies are being told locals have to be paid. So in a sense, companies are being told to pay twice.” Minister of Natural Resources Jim Carr led a large trade delegation to May 2017 • Mai 2017 | 21

Mexico in January where a memorandum of understanding was signed to address concerns over trade growth, sustainability and taxation in the mining industry where Canadian firms account for 70 per cent of foreign direct investment in that sector of the Mexican economy. Gratton confirmed the tax issues encompassed a large portion of the trade talks, which he attended. With the long-term corporate tax rate in Mexico expected to remain at 30 per cent, companies like McEwen Mining have labeled the additional taxes as “Risk Factors” in financial reports, citing them as something that “significantly and adversely affects the mining industry.” “The mining taxes have been a strong negative factor affecting Mexico’s competitiveness over the past years, affecting investment and jobs,” said Michael Harvey, chairman of the Canadian Chamber of Commerce’s mining

22 | CIM Magazine | Vol. 12, No. 3

task force in Mexico. “The funds have unfortunately been extremely slow in reaching local communities, creating the double negative effect of reduced local employment and limited community investment.” CIM

Trump takes aim at environmental regulations President Donald Trump began dismantling several Obama-era initiatives aimed at tackling climate change, proclaiming an end to over-regulation and a “new era in American energy.” On March 28, Trump signed an executive order mandating the Environmental Protection Agency (EPA) to undo a number of policies included in the ‘Clean Power Plan,’ a 2015 initiative which capped carbon dioxide emissions for states as per the Paris

Agreements on climate change. The order “also directs the EPA and the Secretary of the Interior to review and, if necessary, revise or rescind, several regulations that may place unnecessary, costly burdens on coal-fired electric utilities, coal miners, and oil and gas producers,” according to an EPA statement released on the same day. Other eco-policies on the chopping block include clean water protection legislation, greenhouse gas restrictions and a moratorium on new coal mining on federal lands. “This is what this is all about: bringing back our jobs, bringing back our dreams and making America wealthy again,” Trump declared, flanked by coal miners, in a speech to the EPA on the day he signed the executive order. Trump’s presidential campaign heavily courted the U.S. coal sector, promising to bring back jobs to the beleaguered industry in coaldependent states like Wyoming, West

developments Virginia, Kentucky, Illinois, and Pennsylvania, who collectively represented 71 per cent of the country’s coal production in 2015. He often donned a hard hat during rallies, standing by signs that read “Trump Digs Coal,” declaring at a Louisville rally on March 20 that “a lot of coal miners are going back to work.” Coal production for energy in the U.S. dropped roughly 20 per cent from 2005 to 2016, with natural gas, nuclear and renewable energy increasingly picking up the slack, according to the U.S. Energy Information Administration. Data from the Department of Labour shows the industry lost some 60,000 jobs from 2011 to 2016. Many economists and even some industry voices argue that coal’s downturn has more to do with automation, a reduced global demand and increased competition from natural gas than increased regulations.

“Trump has talked about revitalizing the industry, but we haven’t seen any concrete evidence of that,” said Coal Association of Canada president Robin Campbell. “He can repeal laws from the former administration, but natural gas remains the main competitor on the thermal side.” – David Meffe

Freeport, BHP Billiton experience prolonged disruptions at flagship operations It has been a turbulent year so far for copper miners, with labour unrest and government restrictions causing significant disruptions at the world’s largest sites. In what is now the longest mining strike in Chilean history, 2,500 workers at BHP Billiton’s Escondida mine in the Atacama Desert halted operations

for 43 days when they walked out from Feb. 9 to March 24 to protest a new contract that would see their working conditions and benefits change. The latest round of negotiations, on March 22, ended unsuccessfully, and the union chose to invoke a legal provision enabling it to extend the old contract by 18 months. Escondida is the world’s largest copper mine and produced five per cent of the world’s copper in 2016. Erik Heimlich, copper consultant at CRU Group, estimates that “100,000 tonnes of production will be lost [at Escondida] this year,” providing that the situation is resolved, as he expects, by the end of March. While BHP did not comment, the union estimated BHP’s production losses to be worth around US$1 billion. Meanwhile, copper production at the world’s second largest operation, Freeport-McMoRan’s Grasberg mine in Papua, Indonesia, is resuming in

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FROM THE WIRE Gahcho Kué, the world’s largest new diamond mine in 13 years, began commercial production on March 2. The joint venture between De Beers (51 per cent) and Mountain Province Diamonds (49 per cent) is expected to produce some 54 million carats of rough diamonds and contribute $5 billion to the Northwest Territories’ economy over its lifetime. Sandvik Mining and Rock Technology announced on March 3 an agreement with IBM to develop data-driven advanced analytics solutions to improve safety, maintenance, productivity and operational services of mining and rock excavation equipment. The first wave of work will be done on loaders and trucks, and will integrate live data from multiple systems. Iamgold has partnered with EREN Renewable Energy and AEMP to develop a 15-megawatt peak (MWp) solar power plant in 2017 for its Essakane mine in Burkina Faso, the company announced on March 6. The mine is located 330 kilometres northeast of Ouagadougou and produces more than 400,000 ounces of gold per year. The Mining Association of British Columbia announced the departure of its president and CEO Karina Briño, who will be taking on a new industry assignment in her native Chile in early May. In 2016, Briño was named one of Canada’s Most Powerful Women with a Top 100 Award presented by the Women’s Executive Network. Goldcorp purchased a 25 per cent interest in Barrick’s Cerro Casale project in Chile. The sale, coupled with Goldcorp’s concurrent purchase of Kinross Gold’s 25-per-cent interest in the same project, has created a 50/50 joint venture. Goldcorp will fund Barrick’s first US$260 million of expenditures and will spend an equivalent amount on its own behalf for a total commitment of US$520 million.

24 | CIM Magazine | Vol. 12, No. 3

Operations at BHP’s Escondida mine halted for 43 days when 2,500 workers walked off the job to protest a new contract.

stages, according to a March 20 Reuters report. Production stopped on Feb. 11 after Freeport’s only domestic buyer halted operations due to a strike and the Indonesian government applied an export ban to copper concentrate. The government also wants Freeport to convert its current mining license to a different type of contract. Freeport has resisted the change, arguing that the new contract will not support the company’s long-term investment plans in the area. Given its continued dispute with the government over its contract and the export ban, Freeport plans to suspend investments in Papua and reduce production at the mine by 60 per cent. In a statement on March 20, Freeport president and CEO Richard C. Adkerson said the company has not reached an agreement with the government despite “extensive efforts.” According to his estimates, each month of delay awaiting approval to export results in a loss of 32,000 tonnes of production. Added to Freeport’s problems was a worker strike at its Cerro Verde copper mine. The Peruvian government declared the strike, which began March 10 and involved 1,300 workers, illegal, and granted Freeport the right to fire striking workers on March 24. But the

union, to skirt the ruling, immediately ended its strike and began another. The union ended the three-week strike on March 30 and accepted Freeport’s offer of improved family benefits. Given the government ruling, Heimlich does not believe the situation at Cerro Verde will impact global supply. However, he estimates that the combined effect of the stoppages at Grasberg and Escondida – which together account for eight per cent of global copper production – will reduce global production of copper by 250,000 tonnes this year. While he forecasts an oversupply of copper for 2017, it will now be “much smaller” than his original estimate of 320,000 tonnes. Heimlich pointed out that the recent wave of labour unrest is tied to market conditions. “Labour disruptions related to strike and labour negotiations usually become livelier when prices and market conditions are improving,” he said. “Now that the situation has improved a bit, workers are more confident to increase their demands.” According to him, governments, too, are often emboldened by positive market conditions to make higher demands on mining companies. – Cecilia Keating

developments

Remembering Westray Disastrous 1992 Nova Scotia mine explosion spurred legislative changes that critics argue need to be better enforced

Courtesy of the United Steelworkers Canada

By David Meffe

A woman lays flowers in front of the Westray Monument in Pictou County, Nova Scotia, during the United Steelworkers Canada’s 2012 march commemorating the 20th anniversary of the disaster.

May marks the 25-year anniversary of the disaster that killed 26 workers at the Westray coal mine in Pictou County, Nova Scotia. While it remains Canada’s worst workplace disaster in recent memory and a tragic milestone for the industry, it also ushered in a new era in how both industry and government approach safety and corporate responsibility across the country. In the early hours of May 9, 1992, as underground workers were finishing a four-day shift, methane escaped from the Foord coal seam, erupted into flames, igniting coal dust and creating a blast that could be felt for kilometres. Media from around the country descended on the small hamlet of Plymouth and the nation watched for days as it became clear that dragermen would find no survivors in the wreckage – 11 bodies were never recovered. The public inquiry that followed was marred by accusations of gross negligence and an unwillingness to testify on behalf of the mine’s owners and

managers at Curragh Resources. It also revealed that the unsafe conditions in the mine were known to both workers and overseers long before the explosion. “The Westray story is a complex mosaic of actions, omissions, mistakes, incompetence, apathy, cynicism, stupidity and neglect,” wrote Justice Peter Richard in his final report, released in 1997, which excoriated the mine’s management, provincial regulators and politicians. The explosion and its aftermath prompted a wave of provincial and federal legislation reform that sought to address serious concerns surrounding workplace safety and accountability in the mining industry. The Nova Scotia Underground Mining Regulations were completely rewritten with significant involvement from mine operators, labour groups, federal and provincial regulators, and industry associations. “These regulations came into effect in 2008 and

FROM THE WIRE Newmont Mining announced in early March that it will explore a gold district in Yukon through a private placement Goldstrike miner junior with Resources. The agreement gives Newmont an 80 per cent stake in the Plateau property through exploration investment. High grade gold mineralization has been identified over a 50 kilometre strike length in the property. Newmont plans to increase exploration and advanced project spending by 22 per cent in 2017. Barrick Gold also took an interest in Yukon, signing an earn-in agreement with Atac Resources on April 10 and committing an initial $8.3 million to the junior’s exploration program at its Rackla Gold Property. Dominion Diamond responded to what it described as an “unsolicited, conditional and non-binding expression of interest” from the Washington Companies for US$1.1 billion, stating that the company had no experience in the diamond mining and marketing industry, nor a unique plan for the business. Dominion, which has stakes in the Ekati and Diavik mines, instead announced in late March that it would launch a formal sales process. Reported interest from Rio Tinto and Anglo American’s De Beers unit boosted Dominion’s share price by 3.4 per cent in late March. Vale CEO Murilo Ferreira will not renew his contract after his term ends on May 26, the company announced in late February. Fabio Schvartsman, the CEO of Klabin, Brazil’s biggest paper was producer, cardboard and announced as Ferreira’s successor on March 28. Champion Iron Mines announced it had filed a feasibility study demonstrating financial viability and competitiveness for its Bloom Lake iron ore mine in northeastern Quebec. The study estimates the operation can restart with a total capital investment of $326.8 million, which includes mine upgrade costs of $157.2 million. The operation is expected to produce concentrate at an average rate of 7.4 million tonnes a year.

Compiled by David Meffe

May 2017 • Mai 2017 | 25

include specific provisions, as well as strict approval requirements, for underground coal mines. They incorporated the majority of recommendations from Justice Richard,” said Lisa Jarrett, a spokesperson for the government of Nova Scotia. Federal Bill C45, often referred to simply as the Westray Bill, came into effect in 2004 and opened the door for criminal liability of organizations, corporations and their representatives, allowing the law to hold employers criminally responsible for negligence in the event of fatalities or serious injuries on the job. Yet, none of Curragh’s top brass were ever held criminally responsible for the disaster. Now, after a quarter century, groups like the Canadian Labour Congress (CLC), who were instrumental in drafting Westrayrelated legislation, argue that not enough is being done to enforce criminal prosecution to protect workers, despite new laws. “After the federal government made the change, they did absolutely nothing to promote compliance. They didn’t bring the provinces and territories together to talk about the significance. They didn’t train frontline law enforcement to look at workplace accidents as a criminal matter, or put

enough resources to train crown attorneys to prosecute,” said CLC president Hassan Yussuf, likening the issue to drunk driving. “Health and safety laws are good, but the problem is that making companies simply pay a fine is just a slap on the wrist. There hasn’t been much deterrent in preventing accidents wholescale across the country. We feel that the code sends a clear message. If people know they may be held criminally responsible and go to jail, they might take this a little more seriously.” Legislation in the wake of tragedy can only go so far – the ultimate goal is to permanently alter workplace safety culture to reflect realities and the dangers inherent in the extractive sector. “It’s important to have good regulations and safety laws in place. But if they’re not enforced, they don’t mean anything,” said Coal Association of Canada president Robin Campbell. “I think we’ve come a long way, especially since the turn of the century, but it’s still a dangerous occupation with its risks. That’s why it’s important to make sure that people follow the safety regulations in place.” Sean Kirby, executive director of the Mining Association of Nova Scotia, said the provincial mining industry has reduced its injury rate by 90 per cent

in the past two decades. “You can’t bring back the miners who were lost that day, but our focus is on trying to learn from that terrible experience and honouring those miners by always doing a better job in terms of safety,” he said. Several memorials will be held around the anniversary of the tragedy. The United Steelworkers (USW), who chartered the Westray miners after the accident, will be holding a morning vigil at the monument and several other commemorative events along with family members of victims. “We made a commitment to them, all those years ago, that we would never forget them, and that their light would always shine. We will continue this work until we get justice for the miners and their families,” said Nancy Hutchison, health, safety and environment department leader with USW. “Now it’s about enforcement.” CIM

Goldcorp and IBM Canada launch Watson artificial intelligence project at Red Lake IBM Canada is working with Goldcorp to bring its Watson cognitive

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corp. “It could organize it in a fashion that’s a lot easier to understand and access. So, that’s a huge win right there.” After that, the hope is that Watson will learn to “think like a geologist and find patterns that we didn’t find before,” Canepari said. It could, for example, be trained to look out for specific variables that are high predictors of gold. Goldcorp is in the process of collecting and uploading the data into Watson and Canepari said the first results likely will not come for another year or more. The partnership was announced in March, when IBM showed off how its technology can support exploration at Goldcorp and Integra Gold’s Disrupt Mining event at this year’s Prospectors and Developers Association of Canada conference in Toronto. Watson technology first debuted on the game show Jeopardy! and has since been successful in the health-care field, by helping cancer patients find the latest available treatments and clinical trials, said IBM Global Business Services partner Mark Fawcett. But IBM has broadened its focus, branching out into the automotive, finance and now mining sectors. “For the areas of gold exploration or other tough business problems that mining companies are facing, IBM probably wouldn’t have been a company that came to mind with regards to helping to solve the problem,” Fawcett said. “We believe that through this partnership, that perception will change.” As exploration becomes tougher and gold deposits increasingly harder to find, Fawcett said miners need groups like IBM to improve results. He said IBM is working with “a fair number” of other mining companies to see how Watson could help them, not just in exploration but also on the operational side, finding efficiencies and ways to reduce costs. He said the companies are choosing not to be named for now. For Canepari, Goldcorp’s dive into Watson’s technology is a no-brainer.

“I believe mining in general is one of those industries that, because of the downturn of the economy for the past five to 10 years, hasn’t benefitted as much as other industries from technology investments,” Canepari said. “We are ripe for a change, we are behind.” – Sahar Fatima

“Digital revolution” on display at SME 2017 Signs of optimism coupled with emerging new technology had session halls buzzing at the 2017 SME Annual Conference and Expo in Denver, Colorado, under the conference theme “Creating value in a cyclical environment.” The international mining conference attracted roughly 5,000 attendees to the Colorado Convention Center Feb. 19 to 22 to attend more than 120 technical sessions and check out the latest from over 750 exhibiting companies.

The industry is closer to the bottom of the downturn than the top, according to Orion Mine Finance portfolio manager Doug Silver, who delivered the plenary speech. He pointed to the increase in the number of companies being founded today as opposed to those going under, and the uptick in mining investment as positive indicators. Silver also said he believes the next cycle will be driven by supply demands due to shortages in metals. “You want to build a mine at the bottom of a cycle, not at the top of the cycle, so I would argue this is a great time to build a mine,” he said. Technical sessions explored the possibilities of the digital revolution that is slowly catching on in the industry. Heather Dahlman, senior mine engineer in Barrick’s Cortez open pit mining division presented on the technological facelift taking place at the company’s Nevada operations. Among the myriad technologies Bar-

rick is testing company-wide, it has implemented collision avoidance, remote real-time monitoring and regulatory monitoring. It is also simplifying supply chain maintenance by equipping maintenance technicians with tablets. “We’re taking an approach to make it a somewhat Amazon experience for ordering parts and submitting work orders,” she said. Virtual reality was another hot topic on the exhibition floor and among presenters. Clark Haws and Clint Vought of Cementation USA presented a case study of a replacement conveyor system the team designed. Using virtual reality, the team at Cementation was able to intimately examine the design concept before it was built, for example, by viewing components of the machine that are normally inaccessible in real life. As a result of this trial, the team changed the conveyor design, widening the walking path and reducing the hood.

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Next year’s conference – “Vision, innovation and identity: a step change for a sustainable future” – will take place from Feb. 25 to 28, 2018, in Minneapolis, Minnesota. – Tom DiNardo

Got a problem? Ask the crowd At a “Shark-Tank style” event during PDAC 2017, five finalists pitched ideas to industry veterans that they believe could revolutionize the mining industry, from bioremediation to machine learning to injection hoisting. Disrupt Mining, the brain child of Integra Gold and Goldcorp, saw Cementation Canada, Kore Geosystems, Goldspot Discoveries, Bio-Mine Ltd and TradeWind Markets all walk away with at least $50,000 each from judges Rob McEwen, David Harquail, Bernadette Wightman, Robert Herjavec and Todd White. Cementation came

IDLERS

away the big winner with $650,000 in funding and an invite to make a deal with Goldcorp for its injection hoisting technology. The contest, which also had 12 semi-finalists, is an example of mining’s growing reliance on crowdsourcing. The idea behind crowdsourcing is to get as many people as possible from different backgrounds to attack a problem at once, often with cash and bragging rights as the main rewards. The concept has already revolutionized aerospace through the SpaceX Challenge, and had been previously applied to the mining industry with McEwen’s Goldcorp Challenge in the early 2000s. The Australia-based Unearthed organization has inspired more than 1,000 innovators to tackle problems in the global resources sector, and in the process, some 150 promising technologies have been produced.

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In September 2016, software developers, data scientists, engineers and entrepreneurs convened in San Francisco for a 54-hour hackathon hosted by Caterpillar, aimed at bringing together creative problem solvers and industry experts under intense time pressure to propose prototype solutions to industry challenges. “Participants bring a different mindset and a novel approach to solving problems. We call this ‘beginner’s eyes’ to some of these deep technical challenges. A fresh set of eyes can open the highly skilled participants to devise innovative solutions and technologies,” said Roberto Ortega, business development manager at Caterpillar. “We’re excited to put that kind of energy and imagination to work on behalf of our customers.” Ortega said that innovations from these events included novel sensors and analytics for preventing oversize material from blocking the crushers on

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iron ore sites, predictive algorithms that dramatically reduce the need for lab sampling, and wearable devices that improve workplace safety. When Integra Gold acquired the Sigma-Lamaque mill and mine complex in Val-d’Or, Quebec, in 2014, it came with a treasure trove of data on more than 30,000 drill holes, mine plans, details of kilometres of underground workings and countless studies on the properties. Instead of painstakingly analyzing the complex data, the company put it up online and offered $1 million worth of prizes to whoever offered the best ideas on where to make the next gold discovery on the property. It received over 1,300 entries from 90 countries. “Crowdsourcing is unique because it has few barriers to entry. It can attract as big and diverse an audience as possible and it encourages multidisciplinary teaming and pairing,” said Integra Gold executive chairman George Salamis. “It allows those individuals who fly under the radar an opportunity to demonstrate what they are capable of. In return, we get the pleasure of sharing their ideas with the mining industry.” “This is not a fad, innovation is here to stay. For an industry as old as mining, there is always room to grow,” said Salamis. These contests aim to create an environment where entrepreneurship and novel thinking lay the groundwork for innovation, often by participants not currently employed by the mining industry. “There is an ecosystem of hackathon junkies in Toronto who go from event to event, using the opensource opportunity to learn of industry challenges to apply to their own applications,” said Ben Cottrell, a graduate student at the Schulich School of Business who participated in a hackathon sponsored by Barrick in early March. “The key to creating a sustainable crowdsourcing system would be maximising participation and attracting established suppliers – D. Meffe into this space.”

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Pressure cooking carbon University of British Columbia researchers conduct carbon sequestration study at Hard Creek Nickel’s Turnagain property

Pushed by the commodities downturn to return to the drawing board for its expansive property in north-central British Columbia, Hard Creek Nickel is exploring how carbon sequestration might draw the attention of investors. The company is participating in a research program aimed at developing ways to increase the amount of carbon dioxide that is absorbed by tailings from its Turnagain property. The deposit contains significant amounts of nickel and massive amounts of magnesium silicate mineralization. “This is an ideal geological and geographical sweet spot to advance carbon sequestration,” said Dr. About one third of the nickel at Hard Creek’s Turnagain property (pictured) is bound up in olivine lattice and has always been David Dreisinger, a Univer- considered waste. Jarvis said he hopes the study can free up some of that nickel. sity of British Columbia professor in the faculty of materials Dreisinger, who has sat on the advisory capital expenditure it will take to get engineering, who will oversee the the project off the ground. One option, board of Hard Creek, where he advised study. he explained, would be to truck in liqthe company on the selection of uefied natural gas, rather than hook up Fei Wang, a PhD student working hydrometallurgical technology for proto the power grid. The operating cost under Dreisinger’s supervision, will cessing nickel concentrates. would be higher, but would give the run the experiments. Wang will use an Dresinger added that he and Wang company “the flexibility” to operate at autoclave to expose the tailings to pres- also have some ideas on how to alter between 20 and 40 thousand tonnes sure and heat, accelerating how carbon the solution that is used to process the per day. dioxide reacts to the minerals. “We cre- materials, which could accelerate the Increasing carbon sequestration rate of carbon sequestration. ate the conditions for optimal converwould make this plan more financially For Hard Creek CEO Mark Jarvis, sion,” said Dreisinger. “You can think feasible, explained Jarvis, by allowing the efficiencies are promising. In 2011, of it as a pressure cooker.” the company to offset the carbon taxes Hard Creek released a preliminary ecoThe goal of the study, explained that would result from burning the gas. nomic model tailored to the moment Dreisinger, is to “rapidly carbonate the “At the very least, we won’t get hit by involving a major capital expenditure material by creating the right condithe carbon tax,” said Jarvis. B.C.’s carand throughput of 80,000 tonnes per tions in one of the [autoclaves] in order bon tax is $23/tonne. day. The model set aside over $300 to fix the carbon we’re putting into the Like Dreisinger, Jarvis also sees million to connect to existing power system.” potential for increased nickel extracThe reduction in carbon, in turn, grids. The commodity crash, however, tion, though he underlined that it is threw a wrench in the plan, forcing the can be used to offset carbon taxes that “early days” and that they are taking company to “shut down spending.” Hard Creek will face should it go into “baby steps.” And while Jarvis is sanguine about production. Up until now, Hard Creek’s models the outlook for nickel, he is now look“It’s a question of how we make this have focused on processing the nickel ing to start smaller, bringing down the nickel deposit more economic,” said 34 | CIM Magazine | Vol. 12, No. 3

Courtesy of Hard Creek Nickel

By Joel Barde

developments

that is bound up in sulfide form, where approximately two-thirds of the metal resides. A full one third of the nickel is bound up in olivine lattice – and it has always been considered waste. But “if you convert the olivine to carbonate […] theoretically this should free up some nickel,” explained Jarvis. The company has already had significant breakthroughs in the science department. In 2011, Hard Creek assembled a team of metallurgists and developed a more efficient way of processing its ore, with some advice from Dreisinger. By altering its grind size, the company was able to better separate nickel mineralization from the magnesium silicates, resulting in an increase in nickel extraction. “We can now reliably produce an 18 per cent nickel and one per cent cobalt concentrate,” explained Jarvis. For Wang, who has worked with a mining company in the Democratic

Republic of the Congo, the science is relevant to all mining companies. He noted that while carbon sequestration is being studied independently, this study is different – it bridges the worlds of academia and industry. “Once I get the mechanism of the mineral carbonization I can develop a real economic and profitable process,” he said. “This is very important for all mineral companies.” Wang’s enthusiasm was recently given a boost by the Natural Sciences and Engineering Research Council of Canada (NSERC), which awarded the project a $25,000 grant in late February. For Wang, it came as an important vote of confidence. “The grant represents that the government is very interested in this project and believes it’s a good way to combine carbon dioxide sequestration and carbonization. I think that the money is meaningful.” CIM

Students mix it up at the latest Mining Games The University of British Columbia ranked first in the 2017 Canadian Mining Games, beating out nine other teams for the top honours. The games, hosted this year by the University of Toronto from Feb. 23 to 26, are an annual tradition in mining academia that allow students from across the country to network with peers and meet future employers. The University of Toronto placed second while the University of Alberta and Université Laval tied for third. Participating teams competed in 19 different challenges, ranging from drill and blast competitions to crisis management. The challenges were designed to test industry-related skills and provide students with exposure to real mining problems. The winning team was recorded for each event and

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May 2017 • Mai 2017 | 35

Jacob Rumsey, University of Toronto

Isaac Hambrock and Melanie LaRoche-Boisvert from McGill University compete in the mechanical design challenge at the 2017 Canadian Mining Games.

the overall winners were announced at the awards gala in the Fairmont Royal York ballroom on Feb. 26, with each team winning a different bottle of fine liquor for first, second and third place rankings. When students were not competing, they took part in the games’ social calendar, with events like archery tag, private access to the Royal Ontario Museum’s mineral exhibition, networking dinners and pub nights. But, as many of the students can attest, the games are less about the alluring activities, glittering galas and bubbling bar banter, and more about networking opportunities. Oleg Shteyner, one of the organizers and a mining engineering graduate at the University of Toronto, told CIM Magazine the most important part of the games was meeting future colleagues. “It’s a small industry,” he said, “and [here] you’ll certainly meet about 50 per cent of the people you’ll be working with later on.” Behind the scenes, the organizing committee admitted getting sponsors, especially at the beginning of the process, did not come easily. Shteyner speculated that the state of the industry – just starting to recover after a prolonged downturn – had contributed to the scant responses for sponsorship dollars. However, thanks to last-minute commitments from sponsors, the committee was able to earmark around $30,000 from this year’s sponsorship funds for the 2018 games, which will be hosted by Queen’s University in Kingston, Ontario. – Lenie Lucci

Confidence returns to the exploration sector at PDAC 2017 Attendance numbers bounced back, along with a strong sense of optimism in sessions and on the investors and trade show floors at the 2017 PDAC conference in Toronto, as the 36 | CIM Magazine | Vol. 12, No. 3

industry has started to recover from an extended commodities rout. The giant annual conference brought more than 24,100 attendees to the Metro Toronto Convention Centre March 5-8, a notable bump from last year’s 22,000. Numerous consultants and equipment manufacturers mentioned that orders, or at the very least inquiries, were starting to roll in again after an extended slowdown. “There is definitely more optimism about commodities,” said Dave Lawson, president of mining at AMEC Foster Wheeler. “People are looking to move projects forward, and there’s an increased activity of people asking us to come view projects that have been on the shelf.” Analysts generally backed the enthusiasm. “We expect a good year from a price perspective,” said Paul Robinson, a director at CRU Group, in his presentation on the 2017 outlook for commodi-

envisiondigitalphoto.com

developments

At the trade show and investors exchange, and in the conference sessions, PDAC attendees expressed cautious optimism about the industry's recovery from a challenging commodities rout.

ties. Robinson forecasted that 28 of the 36 mining, metal and fertilizer commodities would experience price increases this year, at an average increase

of 12 per cent, and expected cobalt, zinc and copper to be the high performers. With a full session dedicated to analyzing the errors made during the

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downturn, it was clear presenters and attendees were in a reflective mood. Mark Fellows, director of Skarn Associates, criticized companies for making acquisitions specifically under the assumption that commodities would rise further, though he conceded that “CEOs were reacting to shareholder

pressure,” and for developing lowquality deposits, lowering cutoff grades and maximizing the deposit size to get the most out of them. Consultant Lawrence Devon Smith argued that the balance in mining companies has tipped too far to the accounting side, and there is not

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38 | CIM Magazine | Vol. 12, No. 3

enough mining expertise at the highest levels of company management. He credited Barrick Gold’s addition of mining engineer Graham Clow of Roscoe Postle Associates to its board of directors as a step in the right direction, one which more majors should consider following. Delegates were also interested in searching for ideas that would transform a sector that has been historically reluctant to change. “Mining has yet to have any technology that has revolutionized our business,” said Integra Gold executive chairman George Salamis in a session on the future of exploration. He noted that looking at data from the last five to 10 years, “an uptick in exploration dollars did not lead to an uptick in discoveries,” and suggested that adoption of new technology might change that. “We need new inputs into the way we do business.” – Kelsey Rolfe and Ryan Bergen

Oil sands majors sell off assets Four major companies announced significant sales of their oil sands assets, all to Canadian buyers, since December. High costs and low oil prices have made it harder to generate acceptable profits from Alberta’s heavy crude. In mid-December Norwegian Statoil ASA sold its stake in the oil sands to Calgary-based Athabasca Oil Corp in a deal worth up to $832 million. Athabasca acquired the Leismer steamdriven project, which produces 24,000 barrels a day, as well as the undeveloped Corner lease – both are located south of Fort McMurray and employ some 220 people. In early March Royal Dutch Shell sold current and undeveloped assets to Canadian Natural Resources for US$7.3 billion. These are made up of Shell’s 60-per-cent stake in the Athabasca Oil Sands Project which includes the Albian Sands mining operation north of Fort McMurray, the Shell-operated Scotford bitumen upgrader and Quest carbon capture

project northeast of Edmonton. Shell and Canadian Natural also acquired Houston-based Marathon Oil’s 20 per cent stake in Athabasca for US$1.23 billion each. Shell is trying to trim its debt, which totaled US$73 billion last year. Houston-based ConocoPhillips agreed to sell its Canadian oil sands and natural gas assets later in March to Calgarybased Cenovus Energy for $17.7 billion. The deal saw Cenovus acquiring ConocoPhillips’s 50 per cent stake in oil sands assets the two companies previously co-owned, and the latter’s conventional oil and natural gas assets in westcentral Alberta and northeastern B.C.’s Deep Basin. – D. Meffe

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Don’t get bogged down in the details By Bill Lewis

n NI 43-101 Technical Report is an invaluable document for both the reporting issuer and investors. However, these reports often contain too much technical information, which renders them incomprehensible to the untrained reader and less informative to the investing public. According to the guidelines for NI 43-101 technical reporting, the purpose of the document is “to provide a summary of material scientific and technical information concerning mineral exploration, development, and production activities on a mineral property.” The instructions to authors further state that “the qualified person […] should keep in mind that the intended audience is the investing public and their advisors who […] will not be mining experts. Therefore, to the extent possible, technical reports should be simplified and understandable to a reasonable investor. However, the technical report should include sufficient context and cautionary language to allow a reasonable investor to understand the nature, importance, and limitations of the data, interpretations and conclusions summarized in the technical report.” Despite these instructions, there has been a trend towards the inclusion of an overwhelming amount of data and detail that only experts can understand. Since the introduction of the NI 43-101 reporting format, it appears some industry executives, promoters and companies have come to believe that the NI 43-101 Technical Report, prepared for filing purposes, should attempt to describe in detail all the work and data generated for a project. Since the inception of the NI 43-101 reporting format, Micon has seen and examined the gamut of Technical Reports from examples containing barely any useful information to those

40 | CIM Magazine | Vol. 12, No. 3

that make little attempt to summarize the work conducted on a property. The NI 43-101 report is not intended as a data dump at the end of an exploration program, nor does it replace the documentation of a complete or preliminary feasibility study on a property with all its subordinate studies. In general, an NI 43-101 Technical Report should be a good summary of the scientific and technical material concerning exploration, development and production on an issuer’s material property whether it be an initial report on a property or a summary of the feasibility study. In most cases, the details of that work should be documented thoroughly for the company’s internal records, but not in the public disclosure. It should be further noted that the guidelines state: “Since a technical report is a summary document the inclusion and filing of comprehensive appendices is not generally necessary to comply with the requirements of the Form.” For many exploration projects, superfluous detail is presented often to the detriment of clarity. Companies should continue to have their staff or consultants write internal reports on their exploration or operating properties which then can be used as the basis for a publicly-filed NI 43-101 report. Investors do not need to know every nuance of an exploration program, nor should they have to sort through all the details. However, they do need a summary of the significant intersections and key findings of a program or operation based upon information collected using best practices. The preparation of separate allencompassing reports, in addition to an NI 43-101 compliant summary as required for filing, is especially important in the case of pre-feasibility and feasibility studies. Projects at that stage of

development generally involve a number of secondary in-depth investigations of particular aspects and in some cases entire volumes will be devoted to those studies. With advanced projects, in order to trim costs, some companies try to force major studies into a single-volume NI 43-101 report with a multitude of appendices. Too often, this results in inadequate or poorly-organized backup data being available when the project reaches the stage of seeking construction financing. Micon recommends that its clients undertake properly documented prefeasibility and feasibility studies that, once completed, can be summarized into an NI 43-101 report for the purposes of regulatory filing. Thus, the company will have all studies and technical information in one place for the purposes of conducting a due diligence review on the information, while nontechnical investors can use the summary contained in the NI 43-101 to form an opinion regarding a project’s potential value. It is time for everyone in the industry to recognize that NI 43-101 reporting is intended to summarize a company’s exploration work or technical studies related to its properties for the express purposes of relaying this information succinctly to its investors and their advisors. An NI 43-101 report is neither a compendium of every available scrap of information, nor is it a substitute for well-documented pre-feasibility and feasibility studies. CIM This column is an adaptation of an article originally published by Bill Lewis on Micon’s website on Nov. 1, 2016.

Bill Lewis, B.Sc., P.Geo, is a senior geologist at Micon International Limited.

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column

Zero harm – It can be done! By Vic Pakalnis

he accident rates for Ontario mines for 2016 are in. Minister of Labour Kevin Flynn announced in early January that the province achieved zero fatalities! This is an amazing accomplishment. The lost time injury (LTI) rate in 2015 was 0.63 per 100 workers. At the 2016 CIM Conference, the John T. Ryan Award was given to 10 mining companies with zero fatalities and zero LTIs. Is this just dumb luck or does it reflect the mining industry’s commitment to safety? I would argue the latter. In Ontario in 1976, there were 19 fatalities, 12.5 LTIs per 100 workers, and accident rates were at 10.4 per 100 workers. Over the next 40 years, the mining industry undertook a massive change to its culture, technology and regulations. The Royal Commission on Health and Safety in Mines and Mining Plants, headed by Dr. James Ham, rewrote Ontario’s Occupational Health and Safety Act on October 1, 1979. The Act introduced the concept of the Internal Responsibility System, which formed the basis of the Act and the safety management systems still in place today. It outlines clear roles and accountabilities for workplace parties with direct and contributory responsibilities for health and safety. Some might credit improvements in technology. For example, increased mechanization and remote-controlled equipment have removed workers from dangerous locations within a mine site while proximity detection sensors have helped to prevent collisions, accidents and fatalities. In addition, mining methods, which are indeed considered technology, have evolved

from square set mining to vertical retreat mining, which is far safer. Another possible explanation is mandatory training for workers and supervisors in the province. In fact, Ontario was the first jurisdiction in Canada to require it through the Common Core program. Most jurisdictions around the world do not, and even those that do often only require work-

“The global industry must commit to improved training, technology and management systems that will not only work today, but for years to come.”

ers and not supervisors to participate. Perhaps, it could also stem from the unique safety culture established in the mining industry that has every meeting start with a “safety share.” In the past, the industry took a fatalistic approach to safety. The mentality was that mining is a dangerous industry and accidents are just part of the job. This attitude has flipped 180 degrees to the point where some safety associations no longer even use the word “accident” as part of their vocabulary, as it implies that no preventative measures could have been taken to avoid such an event. Instead they prefer the terms “reportable occurrence” or “incident.” Whatever the reason, there has been a markedly positive trend over the past several decades. Where are we going next? At the Zero-Harm German/Canadian Occupational Health and Safety Symposium in Sudbury in June, Germany’s InterSend comments to editor@cim.org

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national Social Security Association mining division will present its Vision ZERO safety strategy in one of the mining capitals of the world. Furthermore, at the World Congress on Safety and Health at Work 2017 in Singapore in September, experts will search for sustainable systems to get us to zeroharm globally and to keep us there. The safety stream at this year’s CIM

Convention includes industry experts from around the world who will share their experiences to this end. The industry has good years and bad years, and some jurisdictions perform better than others, but while a certain amount of risk is always present, a risk that kills is unacceptable. Therefore, the global industry must commit to improved training, technology and management systems that will not only work today, but for years to come. In the future, there will no doubt be setbacks, but Ontario’s zero fatalities reported in 2016 deserves celebration. Plus it answers the question, why did the chicken cross the road? To show the skunks it can be done! CIM

Vic Pakalnis is the President and CEO and MIRARCO as well as the acting vice-president of Laurentian University’s Laurentian Mining Innovation and Technology group.

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Between a rock and a hard place By Rick Stapenhurst

any Canadian mining companies that operate internationally find themselves between a rock and a hard place. On the one hand, the mining industry has been ranked by Transparency International as the fifth most corrupt industry globally, and many developing countries with mineral resources have high levels of corruption. On the other, the 1999 Corruption of Foreign Public Officials Act makes it illegal for Canadian companies and their officers to bribe foreign officials and reports indicate that the RCMP is ramping up investigations into alleged international bribery by Canadian companies. Ongoing research funded by Canada’s Social Sciences and Humanities Research Council and carried out by professors at McGill University and the University of East Anglia in the U.K., together with researchers at the African Centre for Parliamentary Affairs in Ghana is looking at the “supply” and “demand” sides of corruption (i.e. the bribe givers and the bribe takers) in the mining sector in Africa. Preliminary results, after field research in Canada and West Africa, have identified ten “tensions” regarding corruption in the mining industry and suggest possible steps that can be taken by mining companies to reduce their exposure to corruption risk. 1. There is no standardized definition of corruption. Generally, host country civil society representatives and, to a lesser degree, government officials and legislators, defined corruption broadly as “the abuse of public trust for personal gain.” In contrast, corporate officials typically defined it more narrowly as “an illegal payment to a public official for corporate or personal benefit.” 2. A related issue is the costs of corruption. Host country informants in Africa tended to describe the costs of corruption in socio-economic and development terms; one said: “Through

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corruption the state is losing effectiveness, efficiency and resources in general.” By contrast, corporate respondents referred to the additional cost of the bribe itself. Typical was one respondent who stated that, “the time spent by management in attending to investigations, press inquiries or regulatory processes can distract management from the business of developing or operating a mineral property,” not to mention management time spent with corrupt bureaucrats. 3. There is often a discrepancy between official corporate policy against corruption and the necessity to give bribes at the local level, in order to do business in Africa. 4. While most Canadian mining companies recognize the need to assess corruption risk, few are actually doing so. 5. There is a substantial difference between the large and integrated mining companies and the junior exploration and development companies in terms of corporate policies and practice regarding corruption. But the data suggested that corruption is a problem for both large and small companies. 6. There is a gap between law and practice in host countries. Virtually all African countries have laws against corruption, but most fail to implement these laws. 7. Mining companies often see corporate social responsibility as a means to fight corruption and/or to promote local good will, while many African officials and civil society representatives see it as self-serving or even contributing to corruption. 8. Mining companies often do not know how to deal with local chiefs and governments and may not fully appreciate local customs and traditions, especially the traditional concept of paying (modest) tributes to tribal chiefs as a token of respect. 9. There is a problem with smallscale or artisanal mining. Early com-

mentators, such as the World Bank, saw such mining as creating a social safety net and cash-generating alternative for local people in times of economic or environmental stress and as providing livelihoods for retrenched civil servants, teachers and others. In most countries, such mining is illegal and, in recent years has expanded greatly, with adverse environmental and safety concerns. 10. There is a multitude of stakeholders for every project yet a piecemeal approach to the problem. There are clearly two sides to corruption – the supply side and the demand side – and any serious attempt to tackle corruption must include a coalition of all the stakeholders involved (host and home governments, parliaments, civil society organizations and corporations) working to reduce the problem. Mining companies need to take a more proactive stance against corruption. The incentive for many to develop anti-corruption compliance programs is the threat of investigation by the RCMP. Perhaps a better understanding of why corruption is, in the words of former World Bank President James Wolfensohn, “a cancer,” and how it distorts public policy making in host countries, weakens governance and democracy, and ultimately impacts adversely on the poor would be an additional incentive to reduce the supply of corruption. Many major mining companies already have relatively sophisticated compliance and ethics regimes but these need to be applied within their global operations. Juniors generally do not have such in-company anti-corruption programs. Hopefully the final results of this research will provide guidance on building anti-corruption policies and programs as well as assistance in developing detailed assessment frameworks and outlines for corporate compliance regimes. CIM Rick Stapenhurst is a consultant/advisor to the World Bank, a professor of practice at the Desautels School of Management at McGill University and an invited professor at Laval University.

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Courtesy of Metabolik Technologies

A suicidal solution UBC research aims to remediate problematic oil sands process water By Tom DiNardo

Dr. Vikram Yadav and his team of researchers at UBC are bioengineering a strain of E. coli to oxidize naphthenic acids in oil sands process waters.

rocess affected water is somewhat of a sticky thorn in the side of oil sands miners. Oil sands process water (OSPW) generated from mining bitumen in Canada’s oil sands contains suspended and dissolved solids, salts and organic pollutants. “Essentially, it is a very gunky, gooey mixture of sand, oil, ice and problematic organics,” said Vikram Yadav, a researcher at the University of British Columbia. And while much of this water is recycled, it eventually needs to be treated and released back into the environment. According to Yadav, one oil sands miner estimates it will generate between 50 million and 100 million cubic metres of OSPW between now and 2045. For most of these compounds, separation purification processes have been developed to reduce their concentration to acceptable limits. The problem area, however, are organic pollutants known as naphthenic acids (NAs). As it stands, there is no scalable, cost-effective solution to remove NAs. As a result, once the other pollutants have been

eliminated, the remaining OSPW contains a concentration in the range of 25-50 milligrams per litre (mg/l) of NA, which has shown chronic and acute toxicity to local fauna. Yadav and his research team at UBC are now working on a solution to use a bio-engineered strain of E. coli to oxidize the NAs in oil sands miners’ OSPW. They have teamed up with Metabolik Technologies – a start-up funded by Evok Innovation and founded to deliver this solution to industry – and recently received $100,000 in funding through Genome BC’s User Partnership Program to develop the microbial strain. “This project provides a very concrete application and solution to a problem in the mining sector,” said Catalina Lopez-Correa, chief science officer and vice-president of sector development at Genome BC.

This bacteria will self-destruct in 3… 2… Alberta is a challenging environment in which to develop a passive water treatment solution as cold temperatures limit the

Improved safety Low operating costs Reduction of operational personnel Simple maintenance

46 | CIM Magazine | Vol. 12, No. 3

genomics amount of time a bacteria could passively degrade NAs. “Things are frozen for most of the year so you’re looking at about a five- to six-month window during the summer where the [bacteria] has to degrade nearly all of the NAs that are coming in,” said Yadav. In this environment, there already exist unique strains of microbes that are able to consume NAs, using them as a source of carbon for their own cellular metabolic activities. The only problem is that the native strains degrade NAs at a slow rate. “They are able to break down NA by as much as 90 to 95 per cent but it takes about 40 to 50 days for them to do it on a small shaker flask scale,” said Yadav. And although his team tried to manipulate the metabolism of these native strains to get the degradation rate of NAs up, they were unsuccessful. “So then we said, ‘Let’s look at the other side of the coin and study the degradation in these native strains, then use those insights to engineer a new degradation pathway into a strain such as E. coli, which is the workhorse of industrial biotechnology,’” said Yadav. To make things trickier, E. coli is not native to OSPW and a bio-engineered solution must adhere to strict specifications due to the nature of the project. “It has to a) survive those conditions [in Alberta], b) degrade the NAs in a timely fashion, and c) once the treatment objective reaches the appropriate level, these E. coli must self-terminate,” said James Wells, director of Metabolik Technologies. This last step is a key aspect of the project, and one of the main reasons it caught the eye of Genome BC. Yadav referred to it as bio-containment, or engineering a “kill switch.” The idea is that once the E. coli has performed its function of neutralizing the toxin, it destroys itself. “There is no chance of damaging [living organisms] in the natural environment or causing any contamination issues,” said Rahul Singh, project manager for this initiative at Genome BC. At this point in the research, Yadav’s team has already constructed several variants of that kill switch. They are now investigating how native strains of microbes are able to survive in this particular environment. They plan to use this information to engineer E. coli strains that rely on signals unique to OSPW. “If it were to leave these environments, the signals that it would normally receive in the tailings pond are not going to be available and therefore the strain will then essentially start producing suicide genes,” said Yadav. The solution is designed to be the penultimate step in OSPW remediation. Once the water is remediated with the engineered E. coli, it would then be released into an engineered wetland. According to Yadav, industry “has an extensive, very aggressive research program on [wetland] construction and design.” The plant material in the wetland would eliminate any lingering toxins. Research for the project started last July and industry began providing water samples at the beginning of this year. Metabolik is targeting the end of the year to deliver a microbe that shows progress on its three main objectives of survivability, degradation and bio-containment.

The team hopes to conduct a pilot project in a small reservoir known as a “mesocosm” by 2018. Industry could pilot the technology as early as 2019 and begin implementation of the solution thereafter.

Biology in the bigger picture Using biology for mining applications is still pretty new. Due to mining’s inherent conservatism, companies are reluctant to take biological processes and deploy them at full scale. But there are several pilot projects taking place, according to Yadav. “What we’ve seen with mining companies is they’ve been very encouraging from the perspective of supporting some of the research and development in these technologies,” he said, pointing to research being done at UBC in collaboration with Teck Resources and First Point Minerals. “There is a desire to go the biology route.” In terms of using engineered organisms that self-destruct, however, Yadav said he was not aware of other examples. For the moment, the research on this project is specifically focused on developing a strain of E. coli that can degenerate NA. Nevertheless, Metabolik is investigating other areas within the mining industry where this approach could be valuable. “We’re learning what you can and can’t do with this particular strain,” said Metabolik’s Wells, “and are investigating other applications for other industries.” CIM

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Chrystal Simon

New Gold set up Malaise traps at two sets of sites in wetlands and grasslands on the New Afton property to collect insects as part of its plan to monitor biodiversity onsite.

Bugs in the backyard Counting every species at a mine site can give a true gauge of ecosystem health By Peter Braul

hen mines close, mining companies often rehabilitate them at a significant cost. But how healthy is the ecosystem after the company has left, and is the money well spent? Is counting large animals, such as birds or deer, a good enough indicator of the environment’s wellbeing? These were the questions Scott Davidson, manager of environment, social responsibility and tailings at New Gold’s New Afton mine, had as he attended an ecology and evolution conference in Kelowna, British Columbia, in 2013. Paul Hebert, the director of the Centre for Biodiversity Genomics at the University of Guelph happened to have the answers. “The fact that you see a bird fly through a reforested habitat doesn’t tell you a whole lot,” said Hebert, who has spent his life collecting and identifying insects. Tiny bugs have a special place in the food web, because larger organisms constantly eat them and could not live without them. At New Afton, the number and diversity of insects could be a good indicator of how healthy a particular ecosystem is at any moment in time. As part of his Barcode of Life project, Hebert has developed a major research facility to scan a small section of DNA, a so-called barcode, to identify species. “What I talked about at the conference was that here was a fast way,

48 | CIM Magazine | Vol. 12, No. 3

for the first time, to get a handle on terrestrial biodiversity as opposed to focusing on a handful of rapidly moving big organisms like birds and mammals,” he said. Insects on the ground and in the soil, he said, “are immensely more diverse.” But that diversity is not necessarily obvious to the naked eye. Identifying each arthropod species accurately “simply wasn’t possible before. It would have cost a phenomenal amount of money and you would have to find a hundred taxonomists,” Hebert said.

What is there at New Afton anyway? Hebert and Davidson began working together almost immediately after the conference. Later that same year, Davidson sent Chrystal Simon, an environmental technician, to set up Malaise traps at two sets of sites in wetlands and grasslands on the New Afton property. Each set included a control site at an undisturbed area of the mine, and an area that had previously been reclaimed. The traps look like small tents with a large opening at the bottom that allows insects to enter, after which they are funneled upwards towards a collection bottle full of ethanol, where they are preserved. Every week, from spring to fall of 2013, Simon collected the samples and sent them away to the University of Guelph for analysis. The results were remarkable: the sites

genomics

Jordann Foster

averaged roughly 1,300 specimens marked differences between species. each per week. That compares to 106 The right section happens to code for specimens collected each week at cytochrome c oxidase, a gene region Pacific Rim National Park on Vancouthat codes for an enzyme in the mitover Island and 317 specimens per chondria that helps with electron week at Banff National Park. Furthertransport. This gene shows so little more, while both wetland sites capvariation within a species that once tured a similar number of specimens Hebert’s lab sequences a single indieach week, the reclaimed grassland vidual of a species, they can be sure it site collected roughly 45 per cent represents the entire group. fewer specimens, perhaps indicating a The team is presently waiting on heightened sensitivity to the mine’s more numbers from a follow-up study activities. Five species of spiders that they did in 2016. “We’ve added pitfall had never been identified in British traps, focusing more on millipedes and Columbia before were found to exist other ‘creepy crawlies,’” said Davidson. on the New Afton site. They also expanded the scope of “I was pleasantly surprised,” said research to include grasslands off the Davidson. “We had no preconceived New Gold property in collaboration notions of what we would see. We figwith Thompson Rivers University and ured we’d let the numbers speak for New Gold collected an average of 1,300 specimens per the Nature Conservancy of Canada. week from its Malaise traps between spring and fall 2013. themselves.” Lauchlan Fraser, a community and To accurately determine if a speciecosystem ecologist at Thompson men belongs to a certain species, Hebert had to find a sec- Rivers, was the organizer of the 2013 conference, and has tion of DNA that exists in every animal species, shows little worked with New Gold to monitor a number of grassland variation in individuals of the same species and possesses sites in the Kamloops area outside of the mine property. He

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has been involved with the company for the past eight years. His specialty is “assembly rules,” which determine how an ecosystem comes together after a disturbance, and said mine closure gives a unique opportunity to scientists to study environments in a before-and-after context. He also said the technology Hebert has developed “has definitely changed the direction” of his research, and will only grow in importance in his work.

Major infrastructure investment The technology surrounding genetics has gotten much better, but there is still a very hands-on element to the analysis at Hebert’s lab, which represents a $100-million investment in staff, buildings and research infrastructure. “We have about $10 million worth of hardware: sequencers and robots to handle DNA extraction,” he said. “We also have about 100 people working here who are specialized in different parts of the work flow.” Once a vial full of bugs is sent to Guelph, a technician removes one of the legs from each specimen to have its DNA sequenced and preserves the rest. It is a process that takes time, but the other option is classifying 4,000 bugs by eye. “The beautiful thing from the mine’s perspective is that it’s pretty easy,” said Hebert. The cost of the analysis at New Afton in 2013 was between $30,000 and $40,000, esti-

mated Davidson. That did not cover the sampling time or equipment they needed, but Davidson said he feels it was a worthwhile investment. “We see genomics and the application of this type of technology as growing in the next few years.” That is something Hebert is preparing for by driving analytical costs down at his facility in an effort to be the “Kodak film processing lab” for ecosystem assessment through DNA barcoding. The first years of operation have been more costly because work has focused on building the DNA barcode reference library. Once species are entered in the catalogue, new analytical approaches can be employed that will simply match newly collected specimens to their DNA on file. As mines continue to spend major money on reclamation, Davidson said, DNA barcoding will only become more important. “To me it’s always been one of those questions about restoration and reclamation: we can grow stuff, but are we truly achieving that objective of a healthy ecosystem?” The metrics provided by this kind of sampling program, he said, have the potential to inform stakeholder discussions, though he hesitates to say what role DNA barcoding will play in the future. “We need more sites doing it to understand the value of it,” he said. “Genomics in general has a tremendous upside in mining.” CIM

Geostatistical Mineral Resource Estimation and Meeting the New Regulatory Environment: Step by Step from Sampling to Grade Control This course is designed according to the latest regulations on public reporting of Mineral Resources. It aims at showing how state-of-the-art statistical and geostatistical techniques help answer the requirements of those regulations in an objective and reproducible manner. A particular emphasis is put on understanding sampling and estimation errors and how to assign levels estimation confidence through the application of resource classification fundamentals. In addition to a solid introduction to mining geostatistics this course provides a comprehensive overview of industry’s best practices in the broader field of Mineral Resource estimation.

INSTRUCTORS Marcelo Godoy, Newmont Mining Corp., Denver; Roussos Dimitrakopoulos, McGill University, Canada; and Guy Desharnais, SGS Canada Inc., Canada • DATE October 10-13, 2017 • LOCATION Montreal, Quebec, Canada

Strategic Mine Planning with New Digital Technologies, Risk Management and Mineral Value Chains At the time of a continuing rebound of metal markets, learn how the application of new digital technologies that can add substantial value to strategic mine planning and asset valuation. The new technologies and related tools integrate technical risk management while capitalizing on the synergies amongst the elements of mineral value chains through their simultaneous optimization – from mines to products to markets.

INSTRUCTORS Roussos Dimitrakopoulos, McGill University, Canada and Ryan Goodfellow, McGill University, Canada • DATE September 13-15, 2017 • LOCATION Montreal, Quebec, Canada

50 | CIM Magazine | Vol. 12, No. 3

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The bacteria below Changes in soil bacteria could help locate mineral deposits By Christopher Pollon

xploration geochemistry specialist Peter Winterburn is doing pioneering work to discover how genomics could make the task of mineral exploration easier and more economical. Now working with the Mineral Deposit Research Unit at the University of British Columbia (UBC), Winterburn is drawing on decades of geochemistry experience across Africa, Australasia, and South America (including stints with Anglo American and Vale) to explore how deeply buried mineralization can affect changes in the DNA/RNA of bacteria found in surface soil. The ultimate goal: the creation of a handheld tool to genetically sample soil in the field, providing better intelligence in advance of costly drilling programs.

CIM: What got you interested in a mining career? Winterburn: Like many geologists, for me it started off as a hobby. In South Yorkshire, England, where I’m from, we have Jurassic limestones rich in fossils. By the time I went to university I had the option of either following chemistry or geology. I actually enjoyed chemistry more, but the idea of being out in the open, rather than being stuck in a laboratory really appealed to me, so I did geology instead, though of course never gave up on chemistry.

CIM: What’s the UBC gig like? How is it different from your career spent with big companies? Winterburn: I’m at UBC as a Research Chair in Exploration Geochemistry. [At UBC] I have the opportunity and budget to apply science to problems I always knew existed in the past, but never had the funding to test. Currently I have a solid budget funded through Bureau Veritas, Acme Labs and NSERC, which allows me to set up research programs to actually go out and test concepts in the field, including some of those farfetched ideas about how we can find minerals. In addition I can provide training opportunities for future geochemists, an area where demand is greater than supply.

CIM: Can you explain how genomics could be used for mineral exploration? Winterburn: Bacteria are among the best geochemists in the world, and occupy niche environments. A particular bacteria 52 | CIM Magazine | Vol. 12, No. 3

that is happy living in one environment may well be unhappy somewhere else. They can also rapidly mutate to occupy particular niche environments, so small changes [in the environment] will effectively make one type of bacteria unable to live there, or a mutated version of the same bacteria will occupy that same niche. Sometimes the changes can be as simple as genes in the DNA/RNA being activated within an individual bacteria, which allows it to occupy a particular changing environment. So what we’re doing is looking for the genetic changes which indicate they are surviving in a different environment. The level of change we are looking for is so small it could not be robustly detected using routine geochemical tools.

CIM: Is the study of bacteria to explore for minerals a new area of research? Winterburn: As far as I’m aware, at UBC, in collaboration with Sean Crowe from the Life Sciences Centre, we are pioneering in this using current available technology. Back in the mid-‘60s, ‘70s and ‘80s, researchers in the U.S., Australia, and Canada sampled exposed ore bodies looking at particular bacteria, and they could see that bacteria populations would change. Historically, much of this work was done in Petri dishes, and you would wait many days to see the results from the sampling, which came from exposed ore bodies. What we’re looking at now is exploring environments where ore bodies are buried beneath transported material. With modern sequencing techniques, you don’t have to grow anything in a lab anymore, you can take soil and sequence the genes, identifying those changes that are occurring above the mineralization. Finally you need to verify that those changes are only occurring above mineralization. One of the downsides of genomics is that it produces huge data sets, so you must have the computing and statistical power to analyze the data. In the same way that the price of doing the genomic analysis itself has plummeted over the last decade, the ability to work with these massive data sets and statistically manipulate them has improved at a phenomenal rate. The end point however would be a simple handheld tool looking for very specific genes

genomics CIM: The sampling of bacteria is all happening at the surface, right? You’re not looking at drilling and analyzing the bacteria in cores as well? Winterburn: We are looking primarily at surface sampling. Drilling is expensive, it requires permitting, you have to build access roads, and the [drilling] is environmentally invasive. But with surface sampling, you walk across the ground, digging a shallow hole every 50 metres or so to take a sample.

CIM: What do you need to demonstrate through research before these genomic tools can be reliably used in exploration? Winterburn: We are currently doing a proof of concept exercise. We have samples sitting in freezers at -80 C collected as part of my ongoing research programs. We will run those samples through the sequencing system to understand the types of responses we are getting. We’ll take that proof of concept to industry, with the potential to get more funding, and then take it forward for proper research on a greater variety of deposits. That will allow us to establish whether [the results] are just specific to the deposits we tested, or whether it’s more generally applicable, in terms of an exploration tool. That way we will avoid one of the downsides of much geochemical research done in the past on buried deposits. Often an orientation survey at one deposit produces interesting results, a big song and dance is made about it, and it subsequently turns out that the particular technique only worked at that one deposit.

CIM: And whether they are present or not, this could provide the information needed to advance a more in-depth examination of the site, like with drilling? Winterburn: Yes. The way I like to think of any phase of exploration is, each piece of information you collect adds another layer of evidence to help you make an informed decision. The biggest mistake that companies can make in exploration is to focus on one piece of info and drill it, with variable success. The more layers of evidence you can gather, the greater your level of confidence in the decision to either drill or walk away.

CIM: At what point do you think someone will have a handheld device to do this kind of field testing? Winterburn: To be optimistic, someone could be out in the field doing the extraction and analysis in three to five years, obviously depending on the results of the research. CIM

CIM: The samples waiting to be analyzed, they have been taken from all over the world? Winterburn: We have soil samples from a volcanogenic massive sulfide (VMS) ore deposit on Vancouver Island, Highland Valley and Woodjam copper porphyries, central British Columbia, a kimberlite from the Northwest Territories (which is interesting, as there is permafrost and no trees to assist with element mobility), as well as a very arid, super-saline area in the Atacama desert of northern Chile. All of these areas are concealed by young transported cover.

CIM: So in the future, a mining exploration company would be able to genomically analyze surface samples in the field, in areas they already think are promising? Winterburn: Yes. The concept we are chasing currently is target evaluation. Once you’ve selected an area of interest, perhaps from geophysics or geological observations of outcrops, you would collect a suite of soil samples across the surface. The difference is you wouldn’t send those samples to a lab. Our idea is that you can identify very specific changes or an activated gene in the DNA/RNA, and build a detector that is very specific for those particular genes. It would effectively be a palm-sized device, you would take a soil sample and do a DNA extract. You’ve seen those little diabetes test kits? It would look like that. You would take some of the solution from the DNA/RNA extract, put it on the device, and it would tell you if those particular genes are present in the sample or not. May 2017 • Mai 2017 | 53

Courtesy of Newmont Mining Corporation

The

Carbon Conundrum By Peter Braul

Carbon emissions know no borders and reductions in one area of the world are meaningless if there are increases elsewhere.

Is the current model of carbon pricing the best way forward?

Among all the expenses under the watchful eye of Copper Mountain president and CEO Jim O’Rourke, carbon is one that sticks out as potentially the least useful. He runs a mine with cash costs of $1.54 per pound of copper, so the $2.3 million dispensed to the provincial government every year in the form of a carbon tax represents about 1.5 per cent of his total budget. That cost is set to rise to $3.8 million a year by 2020 under Justin Trudeau’s new pan-Canadian carbon price framework. This is a significant expense that all Canadian miners will soon have to tuck into their annual budgets, but does it have the potential to do good for the industry? “The problem I have with the carbon tax, generally, is that we can’t do anything about it,” said O’Rourke. Copper Mountain, he pointed out, is an open pit, low-grade copper mine that relies on diesel fuel to bring ore to the mill. “We’ve got 22 trucks running around and we burn about 30 million litres a year of diesel. To try and reduce our carbon footprint is not easy.” Copper Mountain does not see those millions invested improving the carbon footprint-reduction technology in the mining industry, meaning the mine sees no upside to carbon reduction for the expense under the current system. And though hauling is going to be diesel-driven for a while to come, there are already ways to make the process more efficient. “To give you a good benchmark, a new engine for a truck is about a half a million dollars,” said O’Rourke. “So if we clawed back that $2 million [carbon tax], we could buy four high-efficiency engines for the trucks.” If new Tier-4 engines could save Copper Mountain five per cent of its diesel budget, the mine would save 1.5 million litres a year in fuel, and an additional $115,000 a year in carbon tax paid on diesel. None of that is happening now. “It’s just another tax, in the true sense,” O’Rourke lamented. And even if Copper Mountain could replace 22 truck motors, then what? With the carbon tax in British Columbia set to grow significantly, there are few ways the miner could feasibly reduce emissions much further. David Greenall, a sustainability and climate resilience strategist at PricewaterhouseCoopers (PwC), said this is why policy decisions have to be made carefully. “I think one of the things is recognizing these inherent limitations, recognizing that these are trade-exposed industries, they’re selling their commodity on a world market, they are price-takers versus price-makers. And that is where the role of active engagement with government is important, around essentially cushioning the transitional effects and risks.” 56 | CIM Magazine | Vol. 12, No. 3

Last April, the Mining Association of Canada (MAC) came out in favour of a carbon price to address climate change, under certain conditions. But, from the point of view of MAC’s president and CEO Pierre Gratton, as the rest of Canada develops its national strategy it would do well to look to British Columbia for what not to do. That is why Gratton wrote in a Vancouver Sun column last autumn that the result of a tax like the one in British Columbia is that, in terms of mining, “Jurisdictions that take action on climate change are punished, while those that do not are rewarded with jobs and investment, and climate action is stymied.”

The global picture Carbon emissions are a truly global phenomenon – gasses know no borders and reductions in one area of the world are meaningless if there are increases elsewhere. But aside from parts of Canada, there are not many mining jurisdictions that currently have any sort of carbon price implemented. Within Canada’s borders, Alberta, Ontario, and Quebec join British Columbia as provinces that currently have some form of carbon pricing in place. Unsurprisingly, the jurisdictions outside Canada that have a price include Sweden and Finland, but other joiners are hard to find. This potentially makes less stringent jurisdictions more attractive for investment and results in something called “carbon leakage,” where instead of reducing emissions, operations are moved to other locations and, in some cases, emissions are increased. “The stakes are high in the sense that, unless [Canada’s] policy addresses this concern, then a) climate change will not be addressed, and will potentially result in a net increase in emissions and b) the policy could harm a significant engine of the Canadian economy,” said Brendan Mar-

Courtesy of Newmont Mining Corporation

Globally unaligned carbon pricing schemes make less stringent jurisdictions more attractive to investment, resulting in “carbon leakage.”

shall, MAC’s vice-president of economic and northern affairs. “That’s a lose-lose situation.” Another side effect of imperfectly applied carbon pricing can be political blowback. Back in 2012, Australia passed the Clean Energy Act. “This was the first major legislation imposing a carbon tax on energy use,” recalled Omar Jabara, corporate communications executive with Newmont. But in 2014 the legislation met its end amid heated debate. The tax was initially set at a rate of A$23 per tonne, a modest amount, but was repealed because of the economic impacts. Carbon emissions in Australia have since risen. But a number of carbon pricing schemes are on the way in, most notably in China, which produces about 23 per cent of the world’s carbon dioxide. “Our biggest market is China and they plan to implement a nation-wide carbon trading scheme,” said Graham Winkelman, climate change practice lead at BHP Billiton. “This significantly increases the amount of global emissions that are covered and we watch with interest to see how it will play out.”

Parts of China have been involved in pilot carbon trading markets since 2013, but the nationwide program will mean

CARBON PRICING IN CANADA Three Canadian provinces that currently have a cost of carbon in place use a variety of schemes and prices. Source: CDP 2016

Quebec uses a cap and trade system with the current price at around

$12.60

Alberta has a carbon tax set at around

British Columbia’s carbon tax is

$15.30

$23

All prices are in USD per tonne. May 2017 • Mai 2017 | 57

SHADOW FIGURES Companies use a range of dollar amounts when calculating a “shadow price” of carbon.

Company

Shadow Cost

Anglo American Platinum South Africa

$3.27-$8.17*

AngloGold Ashanti South Africa

$7.70

Gold Fields Limited South Africa

$3.79; $5

Harmony Gold Mining Co Ltd South Africa $3.27 Kumba Iron Ore South Africa

$3.27-$8.17

Sibanye Gold Ltd South Africa

$2.36

Glencore plc Switzerland

$8.17

Anglo American United Kingdom

$3.27-$8.17

BHP Billiton United Kingdom

$24.00

HudBay Minerals Inc. Canada

$15.32-$38.29

Teck Resources Limited Canada

$11.49-$30.64

*All values in USD per tonne Source: CDP 2016 report

up to US$1.16 billion in carbon trading annually starting this year. That is with a relatively modest price of about 30 yuan per tonne (US$4.35) at the outset, and the market is expected to grow to up to US$58 billion after 2020. Chile is also moving forward with a carbon price in 2018, though with a modest US$5 per tonne initial price. Nevertheless, this price has the potential to affect 30 per cent of the world’s copper production and perhaps offer some market support for Copper Mountain. “The reality is that we are in a low carbon transition,” said PwC’s Greenall. He said carbon pricing will affect mining both at the operational level, with technological solutions, and at the demand level. “The demand question is a much bigger kind of question.” The variation in pricing across the globe is an issue, said BHP Billiton’s Winkelman. “The ideal solution over time is a global price on carbon, but that’s a very challenging thing to get right.” He emphasized that, since miners need to look decades in the future to make their business decisions, it is important that climate regulation be stable and predictable. Because all countries have different strategic objectives, he said, they will go about reducing their carbon footprint in different ways. For example, though the United States has no carbon price in place, the Obama administration had shifted to regulating emissions from coal-fired power stations. Essentially, each nation that signed the Paris Agreement last April needs to find its own path to decreasing emissions. “Gaining alignment in some sort of global view is really challenging.”

Internal pricing BHP Billiton is, according to a 2014 report by the Heinrich Böll Foundation, responsible for the 20th largest carbon bud58 | CIM Magazine | Vol. 12, No. 3

get of any company in the world. With the demerger of South32 in 2015, BHP Billiton operates a smaller portfolio now than it did in 2014, but the company has the incentive and the means to aid in the development of a global carbon price. Internally, Winkelman said the company currently models a price of US$24 per tonne of carbon regardless of the location of the project, though he added, “It’s not just one price that we have in mind – we also think about future pricing scenarios.” Consequently, the company evaluates all of its assets considering carbon prices ranging up to US$80 per tonne. It is a strategy that Greenall believes is going to be more widely adopted in the future. “This is just another what I call ‘risk factor.’ A pretty big risk factor, potentially. But it’s just another risk factor that gets internalized into the kinds of modelling that these companies already do.” Greenall also said that beyond simply modelling a price internally (BHP Billiton applies what he calls a “shadow price”), companies can actually set up internal carbon markets between business units. There are many ways to set this up but, for example, each mine could set emissions reduction targets and if the target emissions are exceeded, each tonne of carbon over the goal would result in a penalty paid by that operation to head office and perhaps cuts to bonus pay for executives at that mine. “That’s a direct cost to that operation’s profitability, which of course then gets tied back into individual performance metrics and bonuses, et cetera.” According to a 2016 report from the Carbon Disclosure Project (CDP), 35 per cent of companies that responded to a survey in the materials sector are already internally pricing carbon, or are planning to. In Canada, those currently pricing carbon include HudBay, Teck Resources and Barrick Gold, with Detour Gold and Yamana Gold planning to price carbon in the next two years. However, the worldwide variance in internal price hints at how difficult it will be to set up a global carbon price. For example, South Africa-based Sibanye Gold prices carbon at US$2.36 per tonne whereas BHP Billiton uses a price more than ten times that, and HudBay uses a range of prices between US$15.32 and US$38.29. The most advanced internal pricing schemes are possibly in the oil and gas sector, where Royal Dutch Shell has been tying executive bonuses to climate-related goals. In the energy sector overall, 52 per cent of respondents to the CDP questionnaire currently price or plan to price carbon, which is topped only by the utilities sector with 63 per cent. “There’s a real appetite for information in the investor community,” said Winkelman, who added that at the time BHP Billiton started reporting carbon emissions and pricing them, there were not many examples to follow in mining. “We looked across everything from how the banking sector through to oil and gas and manufacturing were reacting, along with governments. This is going to be characteristic of the way many large companies communicate going forward. It’s all about opportunity, not just about risk.” Greenall said BHP Billiton is definitely a leader in the field, having had an internal carbon price since about 2004. “They were first out of the gate and so they are kind of a lightning rod for both investors and other companies as they look for examples to try and figure out how the heck they do this.”

Courtesy of Copper Mountain Corporation

With cash costs of $1.54 per pound of copper, Copper Mountain’s $2.3 million in annual taxes to the provincial government represents 1.5 per cent of its yearly budget.

Finance sector on alert In addition to internalizing a price on carbon, BHP Billiton is one of the few mining companies to publish a yearly climate change portfolio analysis. The report is a rational summary of how the company plans to act under a variety of very plausible different global policy, environmental and economic outcomes. Their report provides the kind of information that investors are looking for. “I’m certain as we go forward the richness of information will increase,” said Winkelman. A consistent way to structure these kinds of reports is now beginning to take shape. In December, Michael Bloomberg wrote to Mark Carney: “until now, it has been difficult for investors to know which companies are most vulnerable to climate change, which are best prepared, and which are taking action.” Bloomberg’s letter was the introduction to a list of recommendations by the Task Force on Climate-Related Financial Disclosures, of which he is the founder. And, as Carney is the chair of the Financial Stability Board, these recommendations are likely to have a significant impact worldwide. “The Financial Stability Board is essentially all of the Central Bank governors of the G20,” said Greenall. “I can tell you with absolute certainty that many of Canada’s largest pension funds and banks will be adopting the recommendations of the Task Force and thus requiring the companies in which they invest and do business, either on the public or private equity side of their line, to make this information available.” The actual recommendations are too detailed to list here, but included is specific guidance for mining and other sectors that account for the largest proportion of GHG emissions, energy use and water use. As far as implementation, “I don’t believe we’ve seen a shareholder resolution here in Canada,” said Greenall. “But in the last year there have been a number, principally targeted at oil and gas majors – BP, Total and Royal Dutch Shell – asking them to just prepare a climate risk scenario analysis report.” For Copper Mountain’s O’Rourke, perhaps this can serve as a consolation: it would seem only a matter of time until miners are obligated, whether their operations are in Canada or anywhere else, to disclose how they value carbon in order

to garner investment. What is less certain is how, when carbon moneys are actually collected, they will go towards creating a stronger industry for the future. “I think it’s challenging,” said Winkelman. “But when we think of how a carbon price can potentially steer investment towards lower emissions outcomes, which over time will become cost effective, I think that’s a positive outcome for the industry, while at the same time contributing to addressing climate change. The mining industry has a real role to play in the solution.” CIM

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May 2017 • Mai 2017 | 59

THE POWER OF PATIENCE By Eavan Moore

Despite a long history of mining in the region, the team behind Dundee Precious Metals’ Krumovgrad project in Bulgaria had to work hard to lay a foundation of trust before building the mine

he new Bulgarian gold mine under construction by Dundee Precious Metals looks modest on paper. At an annual throughput of up to 840,000 tonnes over eight years and Proven and Probable gold reserves of 807,000 ounces, the open-pit Krumovgrad project is much smaller than Dundee’s first investment in Bulgaria, the Chelopech Mine (“Underground achiever,” CIM Magazine, September 2014). But reaching this point required persistent effort and creative thinking on the part of Dundee’s management. Krumovgrad is Bulgaria’s first greenfield mine in 40 years, and Dundee responded to the ensuing challenges with innovative solutions and standard-setting practices. “This whole process was a matter of us listening very intently to the community and addressing concerns in a constructive way,” said Paul Proulx, senior vice-president of corporate services at Dundee.

Reinvention The project centres on Ada Tepe, a low-sulfidation epithermal gold-silver deposit a few kilometres south of the town of Krumovgrad, close to the Krumovitsa River in the Rhodope Mountains. Mining in Ada Tepe started some 3,500 years ago, but over time subsistence farming and forestry came to dominate local land use. With its 2005 feasibility study, Dundee initially envisioned a carbon-in-leach plant that would produce gold/silver doré bullion. Tailings would be stored in a conventional facility. 60 | CIM Magazine | Vol. 12, No. 3

But the proposed use of cyanide “generated such negative sentiment in the local and regional communities that the project was stalled for several years,” said John Lindsay, senior vice-president of projects at Dundee. The company went back to the drawing board and in 2011 came up with a new design that eliminated that concern and several others. With permits finally secured, construction started in late 2016. Startup is scheduled for the second half of 2018. The biggest change is that the new design uses a flotation process rather than cyanide leaching, at the expense of an eight to 10 per cent reduction in gold recovery. “We gravitated to that as our preferred approach because of the experience and expertise that we had in-house through our Chelopech operation,” said Lindsay. Dundee had successfully introduced Staged Flotation Reactors (SFRs) manufactured by Woodgrove Technologies into its flotation circuit at Chelopech and will do the same at Krumovgrad. SFRs reduce floor space and associated capital costs, while offering potentially better power efficiencies compared with more conventional flotation cells. At Krumovgrad, crushed ore will go through a SAG mill and a vertical mill. After an initial round of flotation, the primary flotation concentrate is reground in another vertical mill, prior to final concentrate upgrading in the cleaner flotation circuit. The gold is very finely distributed, necessitating a grind size of 30 microns. In order to minimize the project

All images courtesy of Dundee Precious Metals

project profile Dundee received the final construction permit for Krumovgrad in August 2016 and site work began soon after.

The overburden at Krumovgrad is non-acid-generating, making it a relatively convenient container. The waste rock will be crushed to a variety of sizes, from soccer-ball-sized down to fines, in order to maintain a homogenous mixture that will stay stable and allow internal drainage. In keeping with the mine’s zero-discharge design, any water reporting to the underdrain will be recycled. “One of the challenges will be coordination of the supply of mine rock to support construction of the integrated mine waste storage facility through the life of the mine,” said Lindsay. “A great deal of detailed planning has been done to optimize the material balance.” The community had many concerns about the Krumovitsa River, which provides water for drinking and agriculture. “The deposit sits on top of a hill, and at the bottom of the hill is the river,” said Lindsay. “In the original project design, which used cyanide, the process facility was located at the bottom in a flat area, but it was very close to the river.” In its redesign, Dundee relocated the plant to the top of the hill. Dundee also committed to treat any water discharged from the site and to run a six-kilometre pipeline from the treatment plant to a discharge point downstream of the community. Locating the plant on a hill resulted in a significant earthworks project to develop level areas. Half of the two-year construction timeline and approximately US$52 million is focused on earthworks. footprint, Dundee decided to produce concentrates for sale to a third party rather than refine the metal further. That was in part a requirement of the European conservation program Natura 2000, which became law in Bulgaria during the permitting process. A compatibility assessment found that the original proposal would have significant impacts on rare flora and fauna; that was mitigated by decisions made to reduce the mine’s footprint. Dundee also worked with a herpetological NGO to fence the site and resettle protected species of tortoise outside it. “Now our standard of practice has been recognized by the European Union parliament as the best available practice working in Natura 2000,” said Iliya Garkov, vice-president and general manager for Bulgaria.

Developing relationships These changes alone did not win over the community of Krumovgrad, where the municipal council was reluctant to move forward with mine development. The project’s operations director, Irena Tsakova, relocated to the community in 2012 to establish closer relationships. Garkov also spent much of 2013 through 2015 in Krumovgrad. “I asked my guys to prepare a list with everybody who was against the project,”

Integrated waste management The redesign also cut out the conventional tailings dam and replaced it with an integrated mine waste storage facility that uses a tenth of the space. Tailings will be thickened to a paste similar to underground backfill, ranging from 56 to 68 per cent solids. Starting at the bottoms of two adjacent small valleys, the tailings will be placed into cells constructed from mine waste rock and progressively rehabilitated with native species as they rise from 300 metres in elevation to 450 metres. Dundee’s general manager for Bulgaria Iliya Garkov has been instrumental in building support for the project within the community. Here he is shown giving a site tour to people from the area. May • Mai 2017 | 61

The processing plant will include staged flotation reactors such as those installed at the company’s Chelopech operation shown here.

Garkov said. “And I started to talk with those guys and asked them for meetings.” Garkov chatted with everybody in Krumovgrad. “I’m from a small community here in the Chelopech region,” he said. “Everybody knows everybody, and they know the history of the families for the last thousand years. You show respect, you show that you recognize their concerns and you address them.” After about a year and a half, Garkov felt that the community had accepted the mine. “I started receiving invitations to go to their houses, to their weddings, and to their celebrations,” he said. Garkov got there by making promises he knew he could deliver on. Residents of Krumovgrad badly needed employment among young people and feared that Dundee would merely send over employees from Chelopech. “When we started to hire local young people and send

The company redesigned the layout of its facilities to move the process plant (right) further from the Krumovitsa River.

62 | CIM Magazine | Vol. 12, No. 3

them to Chelopech for training, they started to see that yes, we actually follow our promises,” he said. Dundee now meets every month with the local mayor and with the chairman of the municipal council to update them on the next few months’ activities and hiring. “Of course we publish all these things, but in the small regions it is very important to show respect to the local leaders as well,” said Garkov. “You have to understand what is important for people. Don’t give them or promise them things which are irrelevant for them.” Dundee committed to hiring 90 per cent of its anticipated 230-person operations workforce from the Krumovgrad region. Since there is little to no mining know-how left there, that meant Dundee would need to train almost all of its employees. The Chelopech operation, 300 kilometres to the northwest, provides a helpful training ground. More than 50 interns have been hired from its university internship program and have progressed as geologists, metallurgists or mechanics. “Two-thirds of our technical services in Chelopech came from this program,” said Garkov. There are now around 12 students from Krumovgrad training in Chelopech for future positions at the Krumovgrad mine. Most of the Krumovgrad workforce will be trained at Chelopech first.

project profile

The site is in Rhodope Mountains of southeastern Bulgaria where the primary industries are tobacco farming and forestry.

Building for a short mine life If ongoing exploration does not extend the life of the mine, Krumovgrad will operate for only eight years. This factored into the way that Dundee constructed the project and made its social commitments. The startup costs had to be kept low, and Dundee has achieved that with an estimated capital cost of $178 million. At current metal prices, the plan is to finance the project partly through free cash flow generated from its other operations and partly through an undrawn committed revolving credit facility, with a small contribution from existing cash on the balance sheet. The on-site electrical rooms and some satellite offices will be modularized – assembled in shipping containers in major urban centres where skilled labour is readily available. The electrical rooms will be assembled, wired and tested off site, reducing the number of skilled tradesmen on-site during construction. With the end of the mine in mind, Dundee made two commitments to its Krumovgrad hires. The first was that they would be qualified when they went to find other jobs. “Everybody everywhere needs good, qualified truck operators or front-loader operators,” said Garkov. “Okay, they will not work in the mine, but they will work on the roads or in civil construction.” The second commitment is that Dundee will offer other types of job training, such as for agriculture, as the project comes to the end of its life. “We’re still thinking about these things,” Garkov said.

Archaeology In order to be cleared for mining rights, Dundee paid for an archaeological study conducted by the Bulgarian National Institute of Archeology and Museum. The dig found 17.5

While modest in size, the mine will be the first new mine to be built in Bulgaria in decades.

tonnes of ceramic artifacts and ancient mining tools amid the stone foundations of buildings from the time. Back then, mining methods were simpler: the miners heated the rock, cracked it by applying cold water, smashing the ore with tools made from rock, and then heated it again in a crude smelting process. But in the last 40 years, said Garkov, “The country forgot what it means to develop a new mine.” For him, the opportunity to open Bulgaria’s first new mine in decades, and its first-ever mine to operate in a Natura 2000 protected area, was the most rewarding part of the process. That entailed challenges – administrative capacity and familiarity with mining had disappeared, while distrust of the mining industry remained. “At the same time,” said Garkov, “that is an opportunity for you to do things the right way in the beginning.” CIM May • Mai 2017 | 63

Hard rock revolution on the horizon Continuous mining machines on the verge of a breakthrough into hard rock operations

Courtesy of Caterpillar

By Alexandra Lopez-Pacheco

Caterpillar’s Rock Straight System uses picks that target the tensile strength of the rock.

64 | CIM Magazine | Vol. 12, No. 3

ontinuous mining systems have been established in coal and soft rock mining for about a century now and the technology to cut through hard rock has been successfully used in civil engineering projects since the late 1950s. One would think that by now, continuous hard rock mining would also be a reality but it is not. The possibility of the technology being applied to hard rock mining has in fact remained stuck between a rock and a hard place for a very long time – until now. Drilling and blasting finally has an emerging competitor. Last September at MINExpo 2016, Caterpillar commercially launched the Cat Rock Straight System, a fully-mechanized longwall system for continuous hard rock mining that features the cutting-edge HRM220 hard rock miner. While Caterpillar is the first to reach commercialization, it is not the only one striving to develop the technology. Atlas Copco, for example, began working on its new generation Mobile Miner continuous hard rock mining technology with Rio Tinto in 2009. It has been working with Anglo American on the development of a continuous hard rock mining system, in a project named Rapid Mine Development System (RMDS), since 2012. Testing of the RMDS at an Anglo American mine began in 2016. Those tests are close to completion and Atlas Copco is planning a formal commercial launch later this year, said Mikael Ramström, Atlas Copco’s director for mechanical rock excavation. As well, Joy Global, now Komatsu Mining, has been testing the prototype for its DynaMiner, which features DynaCut hard-rock cutting technology, since September 2016 with very promising results, according to the company. Sandvik is also developing

| technology

Courtesy of Atlas Copco

UNDERGROUND EQUIPMENT

a continuous hard rock miner called the MX650, but declined the opportunity to discuss its work with CIM Magazine.

The biggest problem with mining hard rock is that it is difficult to break mechanically and that poses challenges in advance rates and energy use, not to mention how quickly it wears down cutting parts. Each manufacturer is using a different approach to increase the wear life of components and reduce the time and energy it takes to break the rock. Caterpillar’s HRM220 has numerous picks mounted on two cutting heads to hit the rock from an angle designed to exploit the rock’s tensile strength, which is 10 to 20 per cent of its compressive strength. “The movement, or activation, of the cutting tool enables each pick to hit the rock with momentum like a hammer,” said Jens Steinberg, commercial manager of hard rock cutting for Caterpillar Global Mining. “The contact is very short and it limits pick heating and wear. The movement is achieved by superimposing rotational movements.” Komatsu Mining’s DynaMiner, on the other hand, employs a DynaCut disc mounted to a smart boom that oscillates. Using an undercutting method, the system chisels the rock with action reminiscent of a heavy, high-speed hammer that exploits the weaker tensile properties of the rock as well. Like the DynaMiner, Atlas Copco’s Mobile Miner uses disc cutters, a technology based on what is used in conventional tunnel boring machines. The company continues to refine the technology. “You have to tune your machine to excavate rock at a certain speed and that speed is very much dependant on the hardness of the rock,” said Ramström. “You can have discs working at a very high speed but that increases the wear on the parts, so you try to tune the machine for that specific rock hardness.” To do this, the Mobile Miner uses sensors in its hydraulic system that monitor how the rock is responding to the pressures and adapts the force accordingly. In fact, modern computer and sensor technologies are being used in all the new hard rock miners for more intelligent and efficient cutting in machines more compact than those used in conventional tunnel boring.

– meaning a smaller, lower-mass, lowerAtlas Copco has been trialling its Rapid Mine cost mining machine,” said Brad NeilSystem at son, president of hard rock mining for Development an Anglo American Komatsu Mining. “Machine size and mine since 2016. mobility is important for our customers, so we have focused on keeping it simple and compact.” Not only do compact hard rock miners reduce energy costs, they also make it far easier to excavate sharp breakaways and cross cuts than it is for a larger conventional machine used in civil engineering. As well, “in civil engineering, when you’re excavating hard rock, you’re only dealing with one tunnel but in mining you have different tunnels,” said Ramström. “So you need to have a technology that is smaller and flexible and can move from place to place.”

Long journey All the technologies have been a long time in the making. Caterpillar first embarked on developing hard rock cutting technology at the beginning of the millennium with underground cutting tests in South Africa and later in Caterpillar’s Luenen, Germany facilities. Once the Rock Straight System was developed, it was tested in a mine in Poland. Komatsu Mining has also traveled a long journey in its research and development, beginning in 2006 when the company first acquired the license for new hard rock cutting technology developed at Australia’s mining research and innovation centre, CRCMining. “Working with industry partners, Komatsu Mining has spent years refinAtlas Copco collaborated with Rio Tinto to develop the Mobile Miner.

Courtesy of Atlas Copco

Different approaches

Smaller, more flexible machines “As we’ve refined the technology, energy in and cut rock out has improved dramatically May 2017 • Mai 2017 | 65

Courtesy of Komatsu Mining

Komatsu Mining’s entry into continuous hard rock mining is the DynaMiner which uses disc cutters.

ing the technology to provide the mining industry a viable alternative to drill and blast,” said Neilson. From validating the cutting technology in a full-scale test rig in South Africa to almost five years of underground testing of its hard rock continuous mining system, the company has verified, studied and improved on everything from the life of the components to material handling, control and automation. Currently, the DynaCut prototype is being tested underground at Newcrest Cadia East Mine in Australia to quantify instantaneous cutting rates in very hard constrained rock to estimate process advance rates and to fine-tune the DynaMiner for commercialization. Meanwhile, Atlas Copco is testing its Mobile Miner and RMDS continuous hard rock mining system at an Anglo American mine. “We are in a situation where we are proving the first machines in a production environment, not in a test environment but in a real mining environment” said Ramström. “We had to be convinced that the whole system could deliver. We knew the technology has been proven in other types of environments but now that we had a new system, we had to prove the system.”

Between the rock’s hardness and the industry’s resistance to change To understand a key obstacle to the development of continuous hard rock mining, one has to go back to 1977, when the Robbins Company – which invented the world’s first hard rock tunnel boring machine two decades earlier – saw the opportunity to adapt its technology for hard rock mining. Within a few years, the company had built the first prototype for the Robbins Mobile Miner, a futuristic machine for its time with sophisticated technology that fractured the rock with steel disc cutters mounted on a rotating wheel. The first Robbins Mobile Miner was commissioned by the Mount Isa mine in northwest Queensland, Australia, in 1983. 66 | CIM Magazine | Vol. 12, No. 3

With an advanced rate of up to 80 metres a month, the miner excavated 1.1 kilometres at the mine. Later, it was purchased by Pasminco’s Broken Hill mine in New South Wales, Australia, where it advanced 1.4 kilometres. In 1993, the year the company’s tunneling division was acquired by Atlas Copco, the Mobile Miner was also used for a civil engineering project in Japan. While the Robbins Mobile Miner had its weaknesses, including short life on wear parts, overall, the technology was proven and successful. Yet no more customers followed. Robbins/Atlas Copco had built the continuous hard rock mining machine and no one came knocking. By 1998, Atlas Copco shelved the technology. “It’s a very conservative industry,” said Ramström. “That was and is the biggest challenge to introducing new technologies. It is the change process that is really tough, not the technology itself in this case.” In the last decade, however, the industry’s resistance to change has softened. Given the challenging and volatile economic environment since the recession, more and more mining companies are prepared to entertain technologies that can improve operations and cut costs. “This time, the interest is coming from the mining companies,” said Ramström.

The benefits Continuous hard rock mining systems offer the potential for easier scheduling, much safer and faster advance rates and greater productivity than conventional drill and blast, which averages about five metres per day. “We are seeing our technology can achieve 10 metres a day,” said Ramström. “With drill and blast you have to stop for blasting and you have to bring in a lot of different machines into the mine. You drill, you blast, you ventilate and you secure the roof with rock bolts and or mesh, you have to bring in loaders and mine trucks and do all this before you can move in another five metres. If one of the machines is not available when you need it, the whole tunnel cycle stops and you can lose a lot of time.” Because continuous mining rock fragmentation is far more consistent compared to drill and blast, continuous hard rock mining machines can also improve milling and eliminate the need for primary crushing, according to Steinberg. Decades’ worth of research and development are making continuous hard rock mining a reality. The technology continues to advance, chipping away at the miners’ resistance to an innovation that could remake the underground mining industry. CIM

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SECTION francophone 70 Lettre de l’éditeur | Mot du président article de fond

71 L’énigme du Co2

Le modèle actuel de tarification du carbone constitue-t-il la meilleure solution pour l’avenir?

75 Le pouvoir de la patience Par Peter Braul

La mine Dundee Precious Metals de Krumovgrad est un projet basé sur la confiance

Par Eavan Moore

La version française intégrale du CIM Magazine est disponible en ligne : magazine.CIM.org/fr-CA

lettre de l’éditeur

mot du président

La corde raide environnementale

L’avenir de l’industrie minière

Aux prises avec la crise que sa propre administration avait créée, le président Ronald Reagan a offert à William Ruckelshaus, le chef initial de l’Environmental Protection Agency (EPA), de reprendre son ancien poste en 1983. Au cours des années précédentes, l’EPA avait perdu son gouvernail. L’administrateur responsable de la gestion du Superfund, destiné à la dépollution environnementale, avait été incarcéré et le public avait perdu confiance en cet organisme de réglementation fédéral. L’une des premières rencontres de M. Ruckelshaus, après avoir accepté le poste, s’est tenue avec les membres de l’industrie des produits chimiques. Plutôt que de l’inciter à assouplir les règlements, ils l’ont exhorté à en rendre l’application plus stricte et à restaurer la crédibilité de l’EPA auprès du public. Un tel règlement ne fonctionne adéquatement qu’en présence de tension entre l’industrie, le gouvernement et le public. Une trop grande mollesse de la part de l’une ou l’autre des parties vient bouleverser l’équilibre. Au début du printemps, les législateurs du Salvador, où 90 pour cent des eaux de surface sont considérées comme étant contaminées en raison du lessivage des terres cultivées et des eaux usées non traitées, ont voté pour faire de ce pays un territoire exempt de mines. Il s’agit du seul pays au monde à avoir imposé une telle interdiction. Bien que le cri de ralliement salvadorien, « Non aux mines, oui à la vie », puisse attiser la colère des fiers mineurs, il témoigne plutôt des problèmes de gouvernance qui sévissent là-bas. Heureusement, dans notre pays, le défi ne se limite pas à une question de vie ou de mort et plusieurs veillent à ce que la situation ne dégénère pas à ce point. Au début d’avril, à la suite de consultations menées partout au Canada, le comité d’experts du ministère de l’Environnement et du Changement climatique a rendu public son examen des processus d’évaluation environnementale fédérale. « En général », a indiqué le panel, « personne ne s’est opposé avec véhémence à la réalisation de projets, même si quelques-uns étaient d’avis que certains projets n’auraient pas dû aller de l’avant. » Les détails de ce processus, maintenant appelé « évaluation des impacts », ne sont pas encore définis, ce qui occasionnera sans doute certains élans de frustration mais, à première vue, il semble que cette première étape bien équilibrée nous procure un avantage enviable.

Parler des tendances futures de l’industrie minière, c’est presque comme prédire le futur prix de l’or : c’est un jeu de dupes. À la conférence de l’ICM à Toronto en 1991, un mineur avait conduit un chargeur-transporteur à Sudbury depuis le hall de l’hôtel Royal York. Nous voici 25 ans plus tard, et cette technologie commence tout juste à gagner du terrain. Je me rappelle également lorsqu’Inco avait désigné Crean Hill comme la mine entièrement électrique de l’avenir. J’ai été le dernier superviseur minier de cette mine lorsque l’équipement d’exploitation minière au diesel a extrait les derniers minerais en profondeur, les véhicules électriques ancrés ayant été abandonnés après s’être révélés peu pratiques d’utilisation. Les grandes sociétés minières d’aujourd’hui, Falconbridge, Noranda et Inco, ont investi de grosses sommes dans la recherche minière, mais les retombées n’ont pas été à la hauteur des larges prévisions. Aujourd’hui, les discussions autour de l’avenir de l’industrie minière tournent autour de concepts comme l’automatisation, l’alimentation par batterie, l’extraction minière continue, les miniréseaux, l’énergie renouvelable, la numérisation et les mégadonnées. Il sera intéressant de voir où les gains principaux se situent et où les niches seront. D’où viendront les nouveaux leaders? Des grandes ou petites sociétés minières, des fournisseurs de matériel d’exploitation minière, des sociétés de la Sillicon Valley, des organismes de recherche, des universités, du gouvernement ou des jeunes entreprises? Les nouvelles technologies qui sont réellement adoptées par la grande majorité naîtront-elles des « pôles d’excellence » où les efforts d’innovation se font de manière coopérative? Est-ce que la propriété intellectuelle s’est éteinte dans l’industrie minière, comme des leaders tels que Mark Cutifani, président et chef de la direction d’Anglo American, l’avaient prédit? Quel est l’avenir des femmes et des autres groupes sous-représentés au sein de l’industrie minière? Peut-on s’attendre à voir des innovations sociales dans l’industrie minière? De telles questions ont laissé les experts des groupes de discussions sur l’avenir de l’industrie minière sans réponse appropriée. Il m’apparaît comme une évidence que l’industrie minière est souvent traditionnellement ancrée dans une phase de « forage, explosion et matériaux de déblai », car le côté humain de la mise en œuvre des technologies n’est souvent pas bien pensé. Pour que les nouvelles technologies s’implantent, le leadership doit pouvoir fournir des réponses bien étayées lorsque la main d’œuvre lui demande ce qu’elle a à y gagner. Ensemble, nous avons été en mesure de répondre avec succès à cette question pour la sécurité. Notre industrie est devenue l’une des plus sécuritaires. Il y a donc une preuve tangible montrant que lorsque nos valeurs et nos efforts et celles et ceux de toutes les parties prenantes sont alignés, l’industrie minière est en mesure de réaliser de grandes choses!

Ryan Bergen, Rédacteur en chef editor@cim.org @Ryan_CIM_Mag

70 | CIM Magazine | Vol. 12, No. 3

Michael Winship, Président de l’ICM @CIMPrez

Les émissions de dioxyde de carbone ne s’arrêtent pas aux frontières, et leurs réductions dans une région du monde sont insignifiantes si elles augmentent ailleurs.

Avec l’aimable authorisation de Copper Mountain Corporation

L’ÉNIGME DU CO

Le modèle actuel de tarification du carbone constitue-t-il la meilleure solution pour l’avenir ? Par Peter Braul

Parmi toutes les dépenses que surveille attentivement Jim O’Rourke, président et chef de la direction de Copper Mountain, celle liée aux émissions de gaz à effet de serre (GES) se distingue comme étant potentiellement la moins utile. M. O’Rourke dirige une mine dont les coûts déboursés s’élèvent à 1,54 $ par livre de cuivre. Les 2,3 millions de dollars versés au gouvernement provincial chaque année à titre de taxe sur le carbone représentent par conséquent environ 1,5 % de son budget total. Ce coût devrait en outre augmenter pour atteindre 3,8 millions de dollars par an d’ici 2020, selon le nouveau cadre pancanadien de tarification du carbone de Justin Trudeau. Il s’agit là d’une dépense substantielle que toutes les sociétés minières du Canada devront bientôt intégrer à leur budget annuel. Pourtant cette approche représente-t-elle un réel potentiel d’amélioration pour l’industrie ? « La raison pour laquelle la taxe sur le carbone me pose problème, en général, c’est que nous ne pouvons rien y faire », commente M. O’Rourke. Copper Mountain, soulignet-il, est une mine de cuivre à faible teneur à ciel ouvert, qui s’appuie sur le gazole pour transporter le minerai vers l’usine de traitement. « Nous disposons de 22 camions de transport

qui consomment environ 30 millions de litres de gazole par an. Ce n’est pas facile d’essayer de réduire notre bilan carbone. » Selon Copper Mountain, ces millions ne sont pas réinvestis pour améliorer la technologie de réduction du bilan carbone du secteur minier. La mine ne voit par conséquent aucun avantage à cette dépense en matière de réduction des émissions de GES dans le cadre du système actuel. Même si le transport devrait dépendre du gazole pendant un certain temps encore, il existe déjà des façons de rendre le processus plus efficace. « Pour vous donner une idée, un moteur neuf de camion coûte environ un demi-million de dollars », précise M. O’Rourke. « Si nous récupérions ces deux millions de dollars [de taxe sur le carbone], nous pourrions acheter quatre moteurs de camion à haut rendement. » Si des moteurs neufs respectant les normes du groupe 4 pouvaient permettre à Copper Mountain d’économiser 5 % sur son budget de gazole, la mine économiserait 1,5 million de litres de carburant par an, et ainsi 115 000 dollars supplémentaires par an de taxe sur le carbone relative au gazole. Aucun de ces scénarios ne se réalise dans la situation actuelle. « Il s’agit juste d’une autre taxe, dans le vrai sens du terme », regrette M. O’Rourke. May 2017 • Mai 2017 | 71

Avec l’aimable authorisation de Copper Mountain Corporation

Avec des coûts décaissés de 1,54 $ par livre de cuivre, les 2,3 millions $ d'impôts que Copper Mountain verse chaque année au gouvernement représentent 1,5 % de son budget annuel.

Imaginons cependant que Copper Mountain puisse remplacer ses 22 moteurs de camion. Que se passerait-il alors? La taxe sur le carbone en Colombie-Britannique devrait augmenter de manière significative, alors que les sociétés minières ne peuvent pas vraiment réduire leurs émissions bien davantage. Selon David Greenall, stratège en développement durable et en résistance aux changements climatiques chez PricewaterhouseCoopers (PwC), c’est la raison pour laquelle les décisions politiques doivent être prises avec précaution. « Je pense qu’il est important de reconnaître ces limites intrinsèques, de reconnaître qu’il s’agit de secteurs exposés à la concurrence, qui vendent leurs marchandises sur le marché mondial et qu’il existe des preneurs de prix et des décideurs de prix. C’est pourquoi il est essentiel de jouer un rôle actif auprès du gouvernement, essentiellement pour amortir les effets et les risques de la transition. » En avril dernier, l’Association minière du Canada (AMC) s’est positionnée en faveur d’une tarification du carbone pour faire face aux changements climatiques, sous certaines conditions. Toutefois, selon Pierre Gratton, président et chef de la direction de l’AMC, alors que le reste du Canada élabore sa stratégie nationale, il serait bénéfique d’étudier la situation de la Colombie-Britannique pour ne pas reproduire la même erreur. M. Gratton a ainsi rédigé un article dans le Vancouver Sun l’automne dernier expliquant que le résultat d’une taxe comme celle de la Colombie-Britannique mène, dans le contexte minier, à ce que des « autorités qui prennent des mesures en matière de changements climatiques se retrouvent punies, alors que celles qui n’en prennent pas sont 72 | CIM Magazine | Vol. 12, No. 3

récompensées par des emplois et des investissements ; et des mesures pour lutter contre les changements climatiques se retrouvent dans l’impasse. »

La situation mondiale Les émissions de GES sont réellement un phénomène mondial ; les gaz ne connaissent pas de frontières et les réductions dans une région du monde sont vaines, si les émissions augmentent dans une autre. Hormis certaines régions du Canada, il existe peu d’autorités minières ayant mis en place une quelconque tarification du carbone. Au Canada, l’Alberta, l’Ontario et le Québec rejoignent la Colombie-Britannique dans le groupe des provinces appliquant actuellement un système de tarification du carbone. En dehors du Canada, les pays qui possèdent un système de tarification comprennent, sans surprise, la Suède et la Finlande, mais il est difficile d’en trouver d’autres. De tels systèmes rendent en effet les régions moins strictes potentiellement plus attrayantes pour les investissements et créent le phénomène de « transfert des émissions » de GES, selon lequel, au lieu de réduire les émissions, les sites d’exploitation sont déplacés dans d’autres régions, ce qui, dans certains cas, accroît les émissions. « Les enjeux sont importants, car, si la politique [du Canada] ne fait pas face à ce problème, a) nous ne contribuerons pas à la lutte contre les changements climatiques, mais à une éventuelle augmentation nette des émissions, et b) cette politique pourrait nuire à un moteur important de l’économie canadienne », explique Brendan Marshall, vice-président des Affaires économiques

et du Nord de l’AMC. « Il s’agirait alors d’une situation où tout le monde serait perdant. » L’autre effet secondaire de l’application imparfaite d’une tarification du carbone pourrait être la récupération politique. En 2012, l’Australie a voté la Loi sur les énergies propres. « Il s’agissait de la première loi importante imposant une taxe sur le carbone en matière de consommation énergétique », se souvient Omar Jabara, cadre des Communications d’entreprise de Newmont. En 2014, cette loi a été révoquée au milieu d’un débat passionné. La taxe avait été fixée à un taux de 23 AUD par tonne, montant modeste, mais qui a été supprimé du fait de ses répercussions économiques. Les émissions de GES en Australie ont depuis augmenté. Plusieurs systèmes de tarification du carbone sont cependant à l’ordre du jour, particulièrement en Chine, qui produit environ 23 % des émissions mondiales de dioxyde de carbone. « Notre plus gros marché est la Chine, qui projette de mettre en place un mécanisme national d’échange de droits d’émissions de GES », précise Graham Winkelman, chef des pratiques de lutte contre les changements climatiques de BHP Billiton. « Cette décision accroît considérablement le volume des émissions mondiales couvertes et nous allons en observer avec intérêt les conséquences. » Certaines régions chinoises participent déjà à des marchés pilotes d’échange de droits d’émissions depuis 2013, mais ce programme national représente des échanges annuels d’émissions pouvant atteindre 1,16 milliard de dollars américains à compter de cette année. Le prix de départ est relativement modeste, environ 30 yuans par tonne (4,35 USD), mais le

marché devrait s’élever à 58 milliards de dollars américains après 2020. Le Chili a également décidé d’adopter une tarification du carbone en 2018, même si c’est à un tarif initial modeste de 5 USD par tonne. Ce prix risque néanmoins d’influer sur 30 % de la production mondiale du cuivre et, peut-être, d’offrir un soutien du marché à Copper Mountain. « Le fait est que nous sommes en pleine transition vers une économie à faibles émissions », confie M. Greenall de PwC. Il prédit que la tarification du carbone aura des répercussions sur les exploitations minières aussi bien au niveau opérationnel qu’au niveau des solutions technologiques et de la demande. « L’aspect de la demande représente une question bien plus importante. » « La variation du prix du carbone dans le monde est problématique », ajoute M. Winkelman de BHP Billiton. « À long terme, la solution idéale serait d’avoir un tarif mondial, mais il s’avère très difficile de fixer un tarif adéquat. » Il souligne que, comme les sociétés minières doivent tenir compte de plusieurs décennies à l’avance pour prendre leurs décisions d’affaires, il est important de disposer d’une réglementation stable et prévisible en matière de climat. Étant donné que les pays ont tous des objectifs stratégiques différents, ajoute-til, ils adopteront donc des mesures différentes pour réduire leur bilan carbone. Même si les États-Unis n’ont pas mis en place de tarification du carbone, l’administration Obama a par exemple entrepris de réglementer les émissions des centrales au charbon. En fait, chaque nation signataire de l’Accord de Paris sur le climat en avril dernier doit élaborer sa propre stratégie de réduction des émissions. « Il sera extrêmement ardu de parvenir à une quelconque harmonie mondiale en la matière. »

Une tarification interne Selon un rapport de 2014 de la fondation Heinrich Böll, BHP Billiton représente le 20e bilan carbone d’entreprise le plus important du monde. Depuis la scission de South32 en 2015, BHP Billiton exploite un portefeuille plus réduit qu’en 2014, mais l’entreprise possède la motivation et les moyens de participer à l’élaboration d’un tarif mondial du carbone. Sur le plan interne, M. Winkelman précise que l’entreprise applique actuellement un tarif de 24 USD par tonne de carbone, quel que soit l’emplacement du projet. Il ajoute cependant : « Nous ne nous concentrons pas seulement sur ce tarif; nous réfléchissons également à des scénarios de tarification futurs. » Ainsi, l’entreprise évalue tous ces actifs en fonction de tarifs de carbone pouvant atteindre 80 USD la tonne. M. Greenall est convaincu qu’il s’agit d’une stratégie qui sera plus largement adoptée à l’avenir. « C’est simplement un autre exemple de ce que j’appelle un “facteur de risque”. Même s’il est éventuellement très important, il ne s’agit que d’un autre facteur de risque à intégrer aux modélisations que ces entreprises appliquent déjà. » M. Greenall précise en outre qu’au-delà de la modélisation interne d’un tarif (BHP Billiton applique ce qu’il appelle un May 2017 • Mai 2017 | 73

« coût implicite »), les entreprises peuvent en fait établir des marchés internes d’émissions de GES entre leurs unités d’exploitation. Il existe de nombreuses manières de le faire. Chaque mine peut, par exemple, définir des cibles de réduction des émissions. Si une unité dépasse cette cible, chaque tonne de carbone dépassant la cible entraîne une pénalité que l’unité doit payer au siège social, ou des réductions sont appliquées aux primes versées aux cadres de cette mine. « Il s’agit alors d’un coût direct pour la rentabilité de l’unité, qui, bien sûr, se répercute sur les mesures du rendement individuel et sur les bonus, etc. » Selon un rapport de 2016 du projet Carbon Disclosure (CDP), 35 % des entreprises ayant participé à une enquête dans le secteur des matériaux disposaient déjà d’une tarification interne du carbone ou projetaient d’en mettre une en place. Au Canada, les entreprises ayant déjà adopté une tarification du carbone comprennent HudBay, Teck Resources et Barrick Gold ; Detour Gold et Yamana Gold prévoient d’appliquer une telle tarification dans les deux prochaines années. L’écart budgétaire mondial des prix internes souligne toutefois la difficulté d’établir un tarif mondial du carbone. Par exemple, le tarif du carbone de l’entreprise Sibanye Gold basée en Afrique du Sud est de 2,36 USD par tonne, alors que BHP Billiton utilise un tarif plus de 10 fois supérieur et HudBay a recours à une fourchette se situant entre 15,32 USD et 38,29 USD. Les systèmes de tarification interne les plus élaborés sont sans doute ceux du secteur pétrolier et gazier. Royal Dutch Shell a ainsi lié les bonus de ses cadres aux objectifs en matière de changements climatiques. Dans le secteur énergétique en général, 52 % des entreprises ayant répondu au questionnaire du CDP appliquent actuellement ou projettent d’appliquer une tarification du carbone ; chiffre que seul le secteur des services publics dépasse avec 63 %. « Les investisseurs ont vraiment soif de renseignements », appuie M. Winkelman. Il ajoute que lorsque BHP Billiton a commencé à déclarer ses émissions de GES et à appliquer une tarification, il existait peu d’exemples à suivre dans le secteur minier. « Nous avons examiné les réactions de tous les secteurs, des banques jusqu’au secteur pétrolier et gazier en passant par le secteur manufacturier et les administrations publiques. Cette approche sera caractéristique de la façon de communiquer de nombreuses grandes entreprises à l’avenir. Tout est une question de possibilités et pas seulement de risques. » M. Greenall confirme que BHP Billiton est effectivement chef de file dans le domaine, ayant adopté une tarification interne du carbone depuis environ 2004. « Ils étaient les premiers à le faire et servent un peu de paratonnerre à la fois pour les investisseurs et pour les autres entreprises, lorsque ces derniers cherchent des exemples pour savoir comment procéder. »

Le secteur financier sur le qui-vive Outre l’internalisation d’une tarification du carbone, BHP Billiton est l’une des rares sociétés minières à publier une analyse annuelle de son portefeuille relatif aux changements 74 | CIM Magazine | Vol. 12, No. 3

climatiques. Ce rapport est un résumé rationnel de la façon dont l’entreprise projette d’agir dans le cadre de différentes politiques et conjonctures économiques et environnementales mondiales très plausibles. Ce rapport fournit le type de renseignements que les investisseurs recherchent. « Je suis certain qu’à l’avenir le volume de ces informations augmentera », confie M. Winkelman. On commence à voir poindre une manière cohérente de structurer ce type de rapport. En décembre, Michael Bloomberg a écrit à Mark Carney : « Jusqu’à présent, il était difficile pour les investisseurs de savoir quelles entreprises étaient les plus vulnérables aux changements climatiques, lesquelles étaient les mieux préparées et lesquelles prenaient des mesures. » Cette lettre de M. Bloomberg servait d’introduction à une liste de recommandations du Groupe de travail sur l’information financière relative aux changements climatiques, dont il est le fondateur. Étant donné que M. Carney est président du Conseil de stabilité financière, ces recommandations auront probablement une incidence notable à l’échelle mondiale. « Le Conseil de stabilité financière est essentiellement constitué de tous les gouverneurs des banques centrales des pays du G20 », précise M. Greenall. Je peux vous dire en toute certitude que bon nombre des plus importantes caisses de retraite et banques du Canada adopteront les recommandations de ce groupe de travail et exigeront par conséquent des entreprises auprès desquelles elles investissent et avec lesquelles elles font affaire (qu’il s’agisse de placements privés ou d’entreprises cotées), qu’elles mettent ces renseignements à disposition. » Ces recommandations sont trop détaillées pour les énumérer ici, mais elles incluent des conseils précis pour le secteur minier et d’autres représentant la part la plus élevée des émissions de GES ainsi que de la consommation d’énergie et d’eau. En matière de mise en œuvre : « Je ne pense pas qu’il existe une résolution des actionnaires ici au Canada », commente M. Greenall. Cependant, l’an passé, un certain nombre d’actionnaires, qui ciblaient particulièrement les grandes sociétés pétrolières et gazières (BP, Total et Royal Dutch Shell), leur ont demandé de préparer un rapport d’analyse de scénarios relatifs aux risques climatiques. » Cela servira peut-être de consolation à M. O’Rourke de Copper Mountain. Il semble en effet que cela ne soit qu’une question de temps avant que les sociétés minières ne soient obligées (que leurs sites d’exploitation se trouvent au Canada ou ailleurs) de divulguer la façon dont elles évaluent les coûts liés aux émissions de GES, afin d’obtenir des investissements. La manière dont ces entreprises parviendront à renforcer leur industrie à l’avenir, lorsque ces montants seront réellement collectés, est cependant moins évidente. « C’est un vrai défi », avoue M. Winkelman, « mais si nous réfléchissons à la façon dont une tarification du carbone peut guider les investissements vers une réduction des émissions, ce qui finira par devenir rentable, je pense qu’il s’agit d’un résultat positif pour le secteur, qui contribue en même temps à la lutte contre les changements climatiques. Le secteur minier a un rôle indéniable à jouer dans cette solution. » ICM

LE POUVOIR DE LA PATIENCE Par Eavan Moore

Dundee a obtenu le dernier permis de construire pour Krumovgrad en août 2016 et les travaux préliminaires de la mise en chantier ont commencé peu après.

algré une industrie minière établie depuis longtemps dans la région, l’équipe soutenant le projet Dundee Precious Metals de Krumovgrad en Bulgarie a dû travailler dur pour établir un climat de confiance avant la construction de la mine.

La nouvelle mine d’or bulgare en cours de construction par Dundee Precious Metals semble modeste sur papier. Avec une production annuelle pouvant atteindre 840 000 t sur huit ans et 807 000 onces de réserves d’or prouvées et probables, le projet de mine à ciel ouvert de Krumovgrad est beaucoup plus petit que le premier investissement de Dundee en Bulgarie, la mine de Chelopech. Cependant, pour atteindre ce résultat, il a fallu des efforts soutenus et beaucoup de créativité de la part de la direction de Dundee. Krumovgrad est la première mine entièrement nouvelle en Bulgarie depuis 40 ans, et Dundee a répondu aux défis rencontrés par des solutions novatrices et des pratiques normatives. « Tout le processus se limitait à écouter très attentivement la communauté et à répondre à ses préoccupations de façon constructive », a déclaré Paul Proulx, premier vice-président des services généraux chez Dundee.

Réinvention Le centre du projet est situé à Ada Tepe, un gisement orargent épithermal à faible degré de sulfuration, à quelques kilomètres au sud de la ville de Krumovgrad, près de la rivière Krumovitsa dans les montagnes Rhodope. Dans la région d’Ada Tepe, l’industrie minière a commencé il y a environ

3 500 ans, mais avec le temps l’agriculture de subsistance et l’industrie forestière ont dominé l’utilisation locale des terres. Dans son étude de faisabilité de 2005, Dundee a d’abord envisagé une usine de lixiviation au carbone produisant de l’argent aurifère. Les résidus auraient été stockés dans une installation conventionnelle. Mais l’utilisation prévue de cyanure « a créé un tel sentiment négatif dans les communautés locales et régionales que le projet a été suspendu pendant plusieurs années, » a déclaré John Lindsay, premier vice-président des projets chez Dundee. La compagnie a refait ses devoirs et est revenue en 2011 avec un nouveau concept qui éliminait ce problème et plusieurs autres. Une fois les permis finalement obtenus, la construction a commencé fin 2016. Le démarrage est prévu pour la deuxième moitié de 2018. Le plus grand changement est que le nouveau concept utilise un processus de flottation plutôt qu’une lixiviation au cyanure, ce qui réduira de 8 à 10 % la récupération d’or. « Nous avons finalement privilégié cette méthode à cause de l’expérience et des compétences que nous avions parmi notre personnel grâce à notre exploitation de Chelopech », a continué M. Lindsay. Dundee a lancé avec succès des réacteurs de flottation étagée (SFR, pour Staged Flotation Reactor) fabriqués par Woodgrove Technologies dans son circuit de flottation de Chelopech, et fera la même chose à Krumovgrad. Les SFR réduisent l’espace au sol et les coûts en capital associés, tout en offrant des rendements énergétiques potentiellement meilleurs par rapport aux cellules de flottation conventionnelles. À Krumovgrad, le minerai concassé passera à travers un broyeur semi-autogène et un broyeur vertical. Après une preLes photos sont aimablement fournies par Dundee Precious Metals

May • Mai 2017 | 75

mière flottation, le concentré de flottation primaire est rebroyé dans un autre broyeur vertical, avant la valorisation finale du concentré dans le circuit de flottation plus propre. L’or est très finement réparti, ce qui nécessite une taille maximale des particules de 30 microns. Afin de minimiser l’empreinte du projet, Dundee a décidé de produire des concentrés qui seront vendus à une entreprise tierce, plutôt que de continuer de raffiner le métal. Cela faisait partie des exigences du programme européen de conservation de la nature Natura 2000, qui est entré en vigueur en Bulgarie pendant le processus d’octroi de permis. Une évaluation de compatibilité a conclu que la proposition d’origine aurait eu des effets importants sur une flore et une faune rares, qui furent atténués par les décisions de réduction de l’empreinte de la mine. Dundee a également collaboré avec une ONG herpétologique pour clôturer le site et réinstaller à l’extérieur des espèces protégées de tortues. « Notre norme de pratique a maintenant été reconnue par le Parlement européen comme meilleure pratique de travail sur les sites Natura 2000, » a confirmé Iliya Garkov, viceprésident directeur général pour la Bulgarie.

sur une zone plate, mais était très proche de la rivière. » Dans le projet modifié, Dundee a déménagé l’usine en haut de la colline. Dundee a également pris l’engagement de traiter toute l’eau rejetée par le site et de construire un pipeline de 6 km entre l’usine de traitement et un point de rejet en aval de la communauté. Le fait de placer l’usine sur une colline a entraîné d’importants travaux de terrassement pour obtenir des surfaces de niveau. La moitié du calendrier de construction de deux ans et environ 52 millions de dollars américains sont consacrés aux travaux de terrassement.

« Vous leur montrez que vous les respectez, que vous comprenez leurs inquiétudes et que vous vous en occupez. »

Gestion intégrée des déchets La nouvelle conception a également supprimé la digue à stériles conventionnelle, qui a été remplacée par une installation intégrée de stockage des déchets miniers utilisant un dixième de l’espace. Les résidus miniers seront épaissis pour former une pâte similaire au remblayage souterrain, composée de 56 à 68 % de matières solides. En partant du fond des deux petites vallées adjacentes, les résidus seront placés dans des cellules construites avec des roches stériles de la mine et progressivement réhabilités avec des espèces indigènes au fur et à mesure qu’ils s’élèveront de 300 à 450 mètres de hauteur. Les morts-terrains de Krumovgrad ne génèrent pas d’acide, ce qui en fait un contenant relativement pratique. Les roches stériles seront concassées en diverses grosseurs allant de la taille d’un ballon de soccer jusqu’aux fines, afin de maintenir un mélange homogène qui restera stable et permettra un drainage interne. En respectant le principe d’interdiction de tout rejet, l’eau provenant du drainage souterrain sera recyclée. « Un de nos défis sera de coordonner la fourniture de roches stériles de la mine pour soutenir la construction de l’installation intégrée de stockage de déchets miniers pendant la durée de vie de la mine, » a dit M. Lindsay. « On a consacré beaucoup de temps à une planification détaillée afin d’optimiser l’équilibre des matériaux. » La communauté était inquiète pour la rivière Krumovitsa, utilisée pour l’eau potable et l’agriculture. « Le gisement est situé en haut d’une colline, et la rivière coule en bas de la colline », a poursuivi M. Lindsay. Dans le projet d’origine, qui utilisait du cyanure, l’installation de traitement était située en bas, 76 | CIM Magazine | Vol. 12, No. 3

Créer des relations

Ces seuls changements n’ont pas suffi à conquérir la communauté de Krumovgrad, dont le conseil municipal était réticent à aller de l’avant avec le développement de la mine. La directrice des opérations du projet, Irena Tsakova, a déménagé dans la communauté en 2012 pour établir des relations plus étroites. Iliya Garkov a également passé beaucoup de temps à Krumovgrad de 2013 à 2015. Il a déclaré : « J’ai demandé à mon personnel une liste de tous ceux qui étaient opposés au projet. J’ai commencé par parler à ces personnes et j’ai demandé de les rencontrer. » M. Garkov a bavardé avec tous les habitants de Krumovgrad. « Je suis originaire d’une petite communauté de la région de Chelopech », a-t-il continué. « Tout le monde connaît tout le monde, ainsi que l’histoire des familles depuis quelques milliers d’années. Vous leur montrez que vous les respectez, que vous comprenez leurs inquiétudes et que vous vous en occupez. » Au bout d’environ un an et demi, M. Garkov s’est rendu compte que la communauté avait accepté la mine. « J’ai commencé à être invité chez eux, aux mariages et autres célébrations », a-t-il déclaré. M. Garkov a obtenu ce résultat en faisant des promesses qu’il savait pouvoir tenir. Les résidents avaient vraiment besoin d’emplois pour les jeunes et avaient peur que Dundee vienne avec ses employés de Chelopech. « Quand nous avons commencé à embaucher des jeunes et à les envoyer à Chelopech pour leur formation, ils se sont rendu compte que nous tenions nos promesses », s’est-il réjoui. Dundee rencontre maintenant chaque mois le maire local et le président du conseil municipal afin de les informer des activités et des embauches des prochains mois. « Nous publions bien sûr tout cela, mais dans ces régions il est très important de faire également preuve de respect pour les dirigeants locaux », a continué M. Garkov. « Vous devez comprendre ce qui est important pour les gens. Ne leur donnez pas ou ne leur promettez pas des choses qui ne les concernent pas. » Dundee a pris l’engagement d’embaucher dans la région de Krumovgrad 90 % des 230 personnes prévues comme person– I. Garkov

project profile

L’usine de traitement comprendra des réacteurs de flottation étagés tels que ceux installés dans l’exploitation de Chelopech de la société, en photo ci-dessus.

nel d’exploitation. Étant donné qu’il ne reste à peu près aucun savoir-faire minier dans la région, cela signifie que Dundee devra former presque tous ses employés. L’exploitation de Chelopech, à 300 km au nord-ouest, offre un centre de formation efficace. Plus de 50 stagiaires ont été embauchés grâce à son programme de stages universitaires et sont devenus géologues, métallurgistes ou mécaniciens. « Deux tiers de nos services techniques de Chelopech proviennent de ce programme, » a confirmé M. Garkov. Il y a actuellement 12 étudiants de Krumovgrad en formation à Chelopech pour de futurs postes à la mine de Krumovgrad. La plus grande partie du personnel de Krumovgrad sera d’abord formée à Chelopech.

En tenant compte de la durée de vie de la mine, Dundee a pris deux engagements en ce qui concerne les personnes embauchées à Krumovgrad. Le premier était que ces personnes seraient qualifiées pour chercher un autre travail. « Partout, tout le monde a besoin de bons chauffeurs de camions ou conducteurs de chargeur frontal, » a dit M. Garkov. « Même s’ils ne travaillent plus à la mine, il travailleront sur des routes ou des chantiers de construction. » Le second engagement consiste pour Dundee à offrir d’autres types de formation professionnelle, pour l’agriculture par exemple, à la fin de la vie du projet. « Nous continuons de réfléchir à ces options, » a déclaré M. Garkov.

Une mine à courte durée de vie

De façon à pouvoir obtenir les droits miniers, Dundee a financé une étude archéologique effectuée par l’institut et musée national d’archéologie bulgare. Les fouilles ont permis de découvrir 17,5 tonnes d’artéfacts en céramique et d’outils miniers anciens parmi les fondations en pierre des anciens bâtiments. À cette époque, les méthodes d’exploitation minière étaient plus simples : les mineurs chauffaient la roche, la fissuraient en l’arrosant d’eau froide, brisaient le minerai avec des outils en pierre et le chauffaient de nouveau dans un processus de fusion rudimentaire. Selon M. Garkov, depuis 40 ans : « le pays a oublié ce qu’était le développement d’une nouvelle mine. » Pour lui, la possibilité d’ouvrir la première mine nouvelle en Bulgarie depuis des décennies et la toute première mine exploitée dans une zone protégée Natura 2000, était la partie la plus gratifiante du processus. Cela impliquait quelques défis – la capacité administrative et la connaissance de la mine avaient disparu, alors que la méfiance vis-à-vis de l’industrie minière demeurait. M. Garkov a conclu : « Par contre, nous avons eu la possibilité de faire les choses correctement dès le départ. » ICM

Si l’exploration en cours ne prolonge pas la durée de vie de la mine, Krumovgrad ne sera exploitée que pendant huit ans. Cela a été pris en compte dans la façon dont Dundee a établi le projet et pris ses engagements sociaux. Les coûts de démarrage devaient être maintenus bas et Dundee a atteint son but avec un coût en capital estimé à 178 millions $. Aux prix actuels du métal, il est prévu de financer le projet partiellement par l’intermédiaire des flux de trésorerie disponibles grâce aux autres exploitations et partiellement par l’intermédiaire d’une facilité de crédit renouvelable engagée non utilisée, avec une petite contribution du solde existant à la date de clôture du bilan. Les locaux électriques et quelques bureaux satellites sur place seront modularisés – assemblés dans des conteneurs d’expédition dans des centres urbains importants, où il est facile de trouver de la main-d’œuvre qualifiée. Les locaux électriques seront montés, câblés et testés hors site, ce qui permettra de réduire le nombre de professionnels qualifiés présents sur le site pendant la construction.

Archéologie

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technical abstracts

CIM Journal Abstracts from CIM Journal, Vol. 8, No. 2

Determining milling parameters of a pear-shaped ball mill for grinding high-talc oxidized copper-cobalt ore M. B. Kime, University of Johannesburg, Johannesburg, South Africa; and A. T. Kaniki, University of Lubumbashi, Lubumbashi, Democratic Republic of Congo

Grinding tests were conducted on an oxidized copper-cobalt ore using a pear-shaped ball mill. Twelve mono-sized ore fractions were prepared and wet ground batchwise. The mill was run for 0.5 to 30 min intervals. The shortest interval provided data more closely related to the breakage function (B) because less secondary breakage was hypothesized. Some selection function (S) and B parameters were determined. Remaining parameters were estimated using a population balance model simulator. To evaluate the kinetics model, an unsized ore sample was also milled. Predicted and measured particle size distributions (PSDs) agreed well, suggesting that S and B parameters can be used for continuous operation mass balances.

Pilot evaluation of an engineering control to reduce airborne exposure to particulates inside drilling cabs K. Morin and G. Lachapelle, Agnico Eagle Mines Limited, Toronto, Ontario, Canada; and C.-Y. Hon, School of Occupational and Public Health, Ryerson University, Toronto, Ontario, Canada

Air-sampling results suggest drill operators working inside environmental drilling cabs at an open-pit gold mine in Nunavut, Canada, are at risk of exposure to asbestos and silica (quartz). The authors installed RESPAÂŽ CF Vortex HyperFLOWÂŽ units, which showed promising results under laboratory conditions. The goal was to evaluate the effectiveness of these units under actual working conditions. Personal and area air sampling was conducted in drilling cabs with and without the unit and a Wilcoxon rank-sum test was performed to compare the results. Particulate concentrations were significantly lower in drill cabs with a unit installed than in those without.

Communicating geological engineering results to manage slope instability M. Foster and R. Yost, Teck Coal Ltd., Sparwood, British Columbia, Canada

This paper describes a case study that illustrates how detailed geological engineering results were communicated to address a range of stability challenges in a producing mining environment. Instead of using standard geological engineering terminology, findings and recommendations were communicated as mine design options and mining responses to accommodate possible slope instabilities and associated risk. The resulting medium- to long-range mine plan integrated the potential slope instabilities and associated mining responses to provide a higher probability of planned resource extraction. It also reduced the potential for long-lasting production and processing delays.

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MINING LORE The rise and fall of the gold standard By Cecilia Keating

hen President Richard Nixon unhitched the U.S. system for another 200 years. The ensuing tension between dollar from the price of gold in 1971, he ousted the paper money and gold and bullion led to the introduction of metal from its 2,000-year position at the heart of a gold standard. global monetary systems. Its history dates back to around 700 In its purest form, a gold standard is a system where counBC, when King Croesus of Lydia struck the first gold coins. tries fix the value of units of currency to a specified amount of Of the metals on the periodic table, gold is a logical con- gold or link their currency to a country that in turn backs its tender for currency. It is dense, relatively easy to mine and dis- own currency to gold. In theory, paper money could be persed fairly evenly throughout the world. Its eye-catching exchanged for gold at a bank. colour makes it difficult to fake. It Britain was the first to adopt a fordoes not rust or tarnish and, while mal gold standard in 1821 and was unreactive, it has a low melting joined by the United Province of point and can therefore be Canada in 1853, Newfoundland in processed and divided easily. 1865, Germany in 1871, and Though it is scarce enough to the United States in 1879. remain valuable, gold is not so rare By 1900 all countries apart from to be an impractical choice. China and a select few in Central Lydia, now western Turkey, was an America were subscribed to the interimportant and affluent trading hub, The Romans inherited the Greek monetary system and national gold standard. Exchange with trade routes stretching to Persia, introduced the Roman gold aureus coin in 50 BC. The aureus rates were fixed, as everything was Courtesy of CNG Coins Egypt, Greece, and Assyria. Gold coins above are from AD 50-54. pegged to the price of gold. In theory, coins quickly became used throughcountries were supposed to have the out the region as a fixed unit of exchange. The Romans inherited gold reserves to back bank deposits and bank notes in circulathe Greek monetary system and gold buttressed the sprawling tion, but this was often not the case. Roman Empire. New territorial conquests were often motivated The system collapsed after the economic turmoil wrought by the acquisition of sources of essential raw materials including by World War One and the Great Depression. Countries abangold. The Roman gold aureus coin was introduced in 50 BC. doned the standard in order to re-inflate their economies by The Romans finessed the science of gold-mining, perfecting printing more paper money. ‘hushing,’ which used powerful water torrents to loosen gold Yet gold still played a supporting role. In 1944’s Bretton veins from mineral deposits. They diverted streams of water Woods agreement, leading Western powers pegged the rate of using aqueducts and used ground sluices to exploit placer exchange of all foreign currency to the U.S. dollar, which in deposits. turn was backed by the States’ expansive gold reserves. The Roman gold was scattered across Europe after the fall of the dollar was the logical choice, given that the U.S. held 75 per empire in the fourth century. While gold coins continued to be cent of the world’s gold reserves and did not have as much used for trade in the Byzantine Empire (the eastern half of the debt as war-torn Europe. Roman Empire, which lasted for a thousand years after the The 1971 “Nixon Shock” signalled the death of gold conWestern Roman Empire disintegrated), Europe was awash vertibility. The U.S. simply did not have the gold to back all the with silver, which dominated the European economic scene dollars in circulation. For the first time, the market would throughout the Middle Ages. determine the price of gold – and it skyrocketed. It was meant But gold had not been forgotten, and was struck again in to be a temporary move but the U.S. government made it pervarious locations in Europe in the 14th century. Far-flung colo- manent in 1976. nial conquests in the centuries that followed were often driven While banks still hold extensive gold reserves, the last by the quest for gold. major currency to be backed in part by gold was the Swiss Spain looted 164 tonnes of gold from Central and South Franc, which had a 40 per cent gold-currency ratio until 2000. America between 1500 and 1650, raising Europe’s supply fiveThe gold standard continues to have its fair share of supfold. Spanish money became the world’s currency of reserve. porters, in particular among U.S. Republicans. In a 2016 inter(North America, South Africa, and Australia would all be plun- view with The Scene, then-presumptive Republican dered for their metal in due course.) presidential nominee Donald Trump said “bringing back the Europe introduced paper money in the 16th century but gold standard would be very hard to do, but boy would it be gold coins and bullion continued to dominate the monetary wonderful.” CIM 82 | CIM Magazine | Vol. 12, No. 3

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