De Beers, Dundee Precious Metals, Goldcorp and Tahoe discuss Renewables

Renewable energy is already becoming mainstream for the mining industry but now the key question is: when will high-penetration renewables become business as usual for powering mines? According to Kim Truter, CEO of De Beers Canada, this next step involves thinking about new ways to configure a mine.

Instead of adopting renewable energy piecemeal, The De Beers Group is looking to radically change how they approach the construction of new projects. “For new assets that are coming online, we are looking at radically different ways of configuring mine sites,” says Truter. “We are considering different ways of mining with a much smaller footprint, and we’ve made a lot of progress in that regard.”

“We’ve just acquired an asset up in Baffin Island, which is quite a remote part of northern Canada,” he continues. “Without a shadow of a doubt, that asset will be radically different from the normal mining paradigm in the way we build it and the way it’s eventually run.”

The De Beers group currently has in place Programme Terra, a sustainability target that would see them reduce their overall energy usage by eight percent by 2020. De Beers Canada has already invested in connecting it’s Victor Mine in Ontario to the local hydroelectric gird and using heat capture technology for its Gahcho Kué operation in the Northwest Territories.

As Truter points, the current focus is on new projects and the creation of more energy efficient operations with potential to move to high penetration renewables. “When it comes to remote operations, if you can avoid having to do things like building roads or putting in a whole lot of infrastructure then that’s where the real savings come from,” he adds.

The appetite for higher penetration renewables is being driven by price. “For the mines who are on a grid, the cost of power can be as much as 10 cents a kilowatt hour and that’s probably going to increase by 10 or 12 percent every year,” notes John Lindsay, Senior Vice President of Project Development for Dundee Precious Metals (DPM). “We’re now seeing some solar providers offering less than 5 cents a kilowatt hour, significantly cheaper than the traditional grid cost, and dramatically lower than any off-grid mine using diesel or HFO fuelled generation.”

In order to take advantage of the cost-saving potential of solar power generation, DPM is currently analyzing solar options for its copper smelting installation in Tsumeb, Namibia which is grid-connected.

“If we were able to exploit renewable energy to reduce our power costs by, say, 50 percent, that could result in an 8 to 10 percent reduction in our total operating costs, which is quite significant,” reports Lindsay. “For [off-grid] mines who are generating their own power, the potential cost savings could be quite a bit higher. They might have the potential to cut their overall operating costs by 20 percent or more by introducing solar or wind generation.”

High-penetration renewables provides mines with an opportunity to hedge against volatile and increasing energy costs. “In the last 5 to 10 years, energy has become a top five cost for mines,” points Bruce Armitage, Energy Manager for Tahoe Resources. “It’s usually second only to labor for most mines and milling facility. A 100% renewable powered operation would cause energy costs to fall out of the top five costs and potentially the top 10 in terms of costings for the mining industry.”

Canadian gold mining leader Goldcorp is building Canada’s first fully electric underground mine at its Borden Lake project near Chapleau in Ontario. Borden will save about $9 million annually on diesel, propane and electricity.

In addition to this groundbreaking project, Goldcorp’s Cerro Negro mine in Argentina has recently signed an agreement with the Province of Santa Cruz to build a wind farm. The company intends the wind-diesel hybrid to enable new industrial investment and development in Perito Moreno region. The project is expected to result in significant energy savings and prevent 296,000 tonnes of greenhouse gases (CO2) from entering the atmosphere.

Goldcorp is also conducting feasibility studies on adding solar to its Canadian operations. “We’re studying a battery storage and solar solution at our Coffee Gold Project in the Yukon,” reports John Mullally, Vice President Corporate Affairs and Energy at Goldcorp. “This is very interesting for the power required in the summertime but not a great solution for the winter so it would need to be supplemented by diesel generation.”

LOOKING AHEAD

Mid-tier precious metals company Tahoe Resources is examining the feasibility of using energy storage, in coordination with renewables, to minimize reliance on grid electricity for its Ontario operation during peak time. Tahoe is also considering the use of electric vehicles for future projects.

“The costing for electric vehicles remains three to four times that of their diesel equivalents,” notes Armitage. “That does make it harder for us

to invest in them, particularly in the case of older mines with existing infrastructure. It does not, however, discount the possibility of us investing in electric vehicles for newer mines.”

Pioneering projects such as Goldcorp’s Borden Lake are highlighting the utility of battery-powered vehicles and the maturity of the technology. “The discussions around electrified equipment for mines have been happening for some years,” notes Dale Rakochy, Product Line Manager at Sandvik, supplier of battery-powered vehicles to the Borden Mines. “The fact that Borden Lake has taken the initiative to realize the benefits of an electrified mine has helped other customers start to see diesel alternatives as a viable technology.”

100% RENEWABLE ENERGY MINING

“From a technology perspective, most of the technology needed to run a mine on 100% renewable power is already available today,” notes Caroline Hillegeer, Senior Vice President of Strategy, Marketing and Technology at Engie. “The key questions to be answered are around how scaleable those technologies are and how cost effective it is to deploy them.”

The mining sector’s apprehensiveness to change is another barrier to widespread adoption of high penetration renewables, notes Russell Blades, CEO of E3 Renewables former Director of Energy and Climate Change for Barrick Gold Corporation. “One of the sayings that gets passed around the mining industry is that everyone wants to be first to be second and it’s that kind of mentality that is one of the major barriers to the large-scale adoption of high penetration renewables.”

However, as with the first renewable energy

projects for the mining sector, the next level with high penetration renewables and world-leading energy solutions for mines will be led by individuals with a vision for change. As De Beers’ Canada’s Truter concludes: “The best way to attack the problem is to change the way you set up the mine in the first place, mining companies need to be asking: is there a different way of configuring a mine?”