World Mining Magazine by World Mining Magazine

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Barrick Gold

Responsible, modern mining

March 2015 Issue 3

World Mining

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Editor

The

Martin Ashcroft

Responsible or responsive Although mankind has mined metals and minerals for centuries, I’m sure readers will forgive me for saying that until relatively recently, the mining industry has not had a great reputation. Mining has always been dirty and dangerous, but it’s a very different story today, as sustainability and social responsibility have become the norm.

regulations and commitments have on the flow of resources we need to supply our consumer industries and build our homes, offices, factories and cars. Manufacturers and service providers across the world pride themselves on their response to customer demand, but there are few industries with longer lead times than mining, so short term peaks and troughs in demand can make for volatile prices in individual metals and minerals.

All of the world’s major miners are now committed to initiatives we have come to know collectively as corporate social responsibility, which include all kinds of environmental issues from flora and fauna to water and air quality, the welfare of native populations, and equal opportunity in the workplace, to mention only a few.

It’s impossible for supply to turn itself on and off that quickly, so the markets are something we have to live with on a daily basis, but the mining industry can only grow in the long term because human beings need new resources as much as we need food.

This is obviously the right thing to do, and the internet and social media are important tools in monitoring corporate compliance, but I think sometimes the rest of the world fails to appreciate the effect that all the

It’s still about the survival of the fittest, but our perception of the fittest is now about producing resources as responsibly as possible, to ensure we all have a future to enjoy them.

Contents COVER STORY

Barrick Gold: Responsible, modern mining

03 06 20 23 23 24

Editors notes: Responsible or responsive Barrick Gold: Responsible, modern mining Monthly news and features Mining news in brief Atlas Copco and Anglo American to test FutureSmart machine Major production milestone reached in Ambatovy

27 28 36 50 52

ly Month news & s feature

Saskatchewan tax changes could cost Potash Corp C$100 million Newcrest Mining: Delivering the future Process Plants International Thinking about economics: Metal mining outlook Aquamate: Water-tight technology

ADVERTISERS Page 2 Page 3 Page 10 Page 14 Page 17 Page 17 Page 18 Page 22 Page 26 Page 37 Page 48 Page 49 Page 54 Page 55 Page 56

Atlas Copco AMM Congress IsaMill, Glencore Monaflex Vulcanising Systems Chemithon Hatch Speaker Engineered Lighting Solutions Dok-Ing Polar Mobility Research Process Plants International GEA Barr-Rosin Seeing Machines IDS Corporation TerraMar Networks Canary Systems

World Mining Magazine

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NEWCREST MINING

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Delivering the future

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World Mining Magazine 2015

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Barrick Gold Responsible, modern mining The worldâ&#x20AC;&#x2122;s largest producer of gold is also a top performer in sustainable mining www.ogsmag.com

Barrick was first listed on

the Toronto Stock Exchange on 2 May 1983 and by 1985 it was one of North America’s top gold producers. A year later, the purchase of the Goldstrike Mine in Nevada set the company on a trajectory to international expansion, acquiring mines in South America, Africa and the Australia Pacific region to become the world’s largest gold producer. Gold has always played an important role in the international 8

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monetary system. Gold coins were first struck on the order of King Croesus of Lydia (an area that is now part of Turkey), around 550 BC. They circulated as currency in many countries before the introduction of paper money. Once paper money was introduced, currencies still maintained an explicit link to gold. By the late 19th century, many of the world’s major currencies were fixed to gold at a set price per ounce, under the

‘Gold Standard’. Barrick is a senior gold producer focused on growing free cash flow through disciplined capital allocation and operational excellence. Its vision is to be the world’s best gold mining company by operating in a safe, profitable and responsible manner. Barrick operates five cornerstone mines — Cortez and Goldstrike in Nevada, Pueblo Viejo in the Dominican Republic, Lagunas Norte in Peru and

Barrick Gold

Veladero in Argentina. Barrick continues to be recognized for its strong corporate responsibility culture. The corporation has been listed on the Dow Jones Sustainability World Index for seven consecutive years, ranked most recently as the top performer in the mining industry category. Barrick Goldâ&#x20AC;&#x2122;s breadth of operations spans the globe. Its key sites include Puerto Viejo in the Dominican Republic,

Kalgoorlie in Western Australia, The Cortez District in Nevada, Jabal Sayid in Saudi Arabia, Pascua-Lama on the Chile/ Argentina border and Kabanga in Tanzania.

Pueblo Viejo Pueblo Viejo is located in the Dominican Republic, approximately 100 kilometers northwest of the capital city of Santo Domingo, and is operated by the Pueblo Viejo Dominicana Corporation (PVDC), a joint

venture between Barrick (60%) and Goldcorp (40%). The mine completed its ramp up in 2014, and is now the only mine in the world with annual production of more than one million ounces of gold. Barrickâ&#x20AC;&#x2122;s technical experts have identified multiple opportunities to further optimise operations and increase cash flow at Pueblo Viejo. These include: increasing plant throughput by optimising ore blending and autoclave www.ogsmag.com

When KCGM needed to increase the grinding throughput at their Gidji Operation, the obvious choice was an IsaMill.

IsaMill, meeting the needs of the mining industry for over 20 years. Initially developed as the enabling technology for fine grained zinclead orebodies of McArthur River and Mount Isa deposits it was soon realised that this compact, highly energy efficient grinding machine could be equally applicable to a variety of other mineral applications and duties. In 20 years since technology development the IsaMill is now used in a range of metalliferous applications including base metals (copper, lead, zinc and nickel), PGMs, iron ore, industrial minerals, coal and gold processing, and is

the optimum choice for regrinding, fine and ultrafine grinding and mainstream grinding duties. IsaMills were first installed at Mount Isa in 1994 – now over 125 IsaMills are installed and supported across six continents. With a full product range to suit the smallest applications (75 kW) to the largest (8 MW) backed up by a world class, global contingent of process and mechanical support staff, there is an IsaMill to suit your needs.

“... our clients get more than just a mill, they become part of a technology partnership.” – Greg Anderson, IsaMill Technology Manager, Glencore Application of the IsaMill technology in gold processing started 15 years ago with the installation of 1.1 MW mills into KCGM’s Gidji and Fimiston operations. The current installation of the 3 MW IsaMill complements these first commercial installations.

Barrick Gold ability; and reducing costs by optimizing maintenance programs. Long-term, Pueblo Viejo has significant reserves and resources with potential to extend the life of the mine. As of 31 December 2014, Pueblo Viejo had proven and probable gold reserves of 9.3 million ounces.

Cortez District The Goldrush discovery is located approximately six kilometers from Barrick’s Cortez mine in Nevada. The project is progressing through a prefeasibility study, on schedule for completion in mid-2015. Barrick is evaluating a number of development options, including underground mining or a combination of both underground and open pit mining. Infill drilling is confirming continuity of high-grade mineralization and supporting an underground mining scenario. In 2014, Barrick submitted a permit application for twin exploration declines, which will help to better define the existing resource and allow them to test for additional

mineralization beyond the northern end of the deposit. The Cortez District continues to yield promising exploration opportunities beyond Goldrush. Barrick has earned a 70% interest in the Spring Valley project — approximately 60 miles west of Cortez — by conducting exploration drilling and scoping activities. The project is advancing through a prefeasibility study, which is on track for completion in late 2015. This is a low capital cost, heap leach project with the potential to become a standalone mine. The company also has the option to attain a 75% interest in the Gold Ridge project, located just north of Cortez, by completing a scoping study. This is an earlier stage opportunity in a key district, which has encouraging geological characteristics. During 2014, an Environmental Impact Assessment and Plan of Operations were approved for the 60%-owned South Arturo project, another near-mine discovery,

which is located approximately eight kilometers northwest of Goldstrike. Barrick plans to start development in late 2015 and mine the high grade, high return portion of the resource in 2016 and 2017. The bulk of the ore will be processed through Goldstrike’s refractory facilities. Due to its high grade, near surface nature, the project is expected to have lower capital development and operating costs than Goldstrike.

KCGM – Kalgoorlie, WA The Kalgoorlie operation consists primarily of the Super Pit openpit mine, located along the Golden Mile ore bodies which were previously mined from underground. The mine is located adjacent to the town of Kalgoorlie approximately 550 kilometers east of Perth, Western Australia. The pit is oblong in shape and is approximately 3.5 kilometres long, 1.5 kilometres wide and 570 metres deep. At these dimensions, it is large enough to be seen from space. The mine produces 850,000 ounces (28

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“The Super Pit at Kalgoorlie is large enough to be seen from space”

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Barrick Gold tonnes) of gold per year, and employs around 550 employees directly on site. Barrick holds a 50% interest with Newmont Mining Corporation holding the remaining 50% interest. Kalgoorlie is an openpit, truck-and-loader operation. Ore is treated at the Fimiston mill, with the resulting sulphide concentrates then roasted and leached at the Gidji roaster, approximately 20 kilometers north of the main Kalgoorlie operations. Gold-laden carbon from the Gidji roaster is also processed at the Fimiston mill. Concentrates that cannot be processed by the roaster are treated by two ultra-fine grinding mills. The Super Pit is the biggest gold open pit mine in the country and the companyâ&#x20AC;&#x2122;s operations ensure Australia holds its place, behind South Africa and the USA, as the third biggest gold producer in the world.

Jabal Sayid In July 2014, Barrick reached an agreement to form a 50/50 joint venture with Saudi Arabian Mining Company (Maâ&#x20AC;&#x2122;aden) for the Jabal Sayid copper mine in Saudi Arabia, and finalised the deal in December 2014. First shipments of low-cost concentrate are expected in early 2016. When fully operational, the mine is expected to produce 100 million pounds of copper in concentrate per year in its first full five years, with the potential to increase to 130 million pounds per year. At the end of 2013, Jabal Sayidâ&#x20AC;&#x2122;s copper reserves were 1.4 billion pounds. Further exploration work will be carried out within the mining license area and the exploration license area surrounding the mine with the aim of extending the mine life.

Pascua-Lama The Pascua-Lama project is situated on the border of Chile and Argentina, in the Frontera district at an elevation of 3,800 to 5,200 meters, approximately 10 www.ogsmag.com

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Barrick Gold

kilometers from Barrick’s Veladero mine. It has 15.4 million ounces of gold reserves and more than 674 million ounces of contained silver. Late in 2013, Barrick announced the temporary suspension of construction at Pascua-Lama, except for activities required for environmental and regulatory compliance. The ramp-down process has been completed on schedule and budget and the project is now on care and maintenance. Pascua-Lama’s new executive project director, Sergio Fuentes, has nearly three decades of successfully managing the construction of complex mining projects in Chile, including high-altitude operations in the Andes. He and the team he is assembling are working hard to assess Pascua-Lama’s economics going forward. To do so, they will address the project’s

outstanding legal and regulatory hurdles, and will complete a new execution plan to optimise remaining construction activities. If that plan aligns with Barrick’s capital allocation objectives and demonstrates an acceptable return on invested capital of at least 15%, the company will be able to consider resuming development of Pascua-Lama. In the meantime, Barrick is working to minimize the costs of holding the asset.

Kabanga The 50%-owned Kabanga nickel project in Tanzania has an estimated measured and indicated resource of 37.2 million tonnes grading 2.63% nickel and an inferred resource of 21 million tonnes grading 2.6% nickel. The project is located in northwestern Tanzania, approximately 385 kilometres west of the Bulyanhulu gold mine and 100 kilometres

northwest of the Tulawaka gold project, which is currently under construction.

Future potential Cerro Casale is one of the world’s largest undeveloped gold-copper deposits. Approval of the Environmental Impact Assessment was received in January 2013 from the Servicio de Evaluacion Ambiental, the environmental authority of northern Chile. Cerro Casale has total proven and probable gold and copper mineral reserves of 23 million ounces of gold and 5.8 billion pounds of copper contained within reported gold reserves. Barrick continues to explore alternative development options for this project, which is located in a high potential district, as well as continuing the process of obtaining necessary rights of way. The Donlin Gold project in Alaska www.ogsmag.com

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Barrick Gold is a joint venture between Barrick (50%) and Novagold (50%). Although the Donlin Gold project contains large, long life mineral resources, with significant leverage to the price of gold, it is uncertain when or if it will be able to meet the company’s investment criteria given the required large initial capital investment.

Responsible, modern mining Barrick Gold Corporation has been named to the Dow Jones Sustainability World Index for the seventh consecutive year and has been ranked as the top performer in the mining industry category. “We are honored to be included in this highly-respected index once again this year. Our goal is to be a responsible partner in resource development, ensuring our operations generate positive and sustainable benefits for all of our stakeholders, including governments, communities and investors,” said copresident Kelvin Dushnisky. “Achieving industry-leading social and environmental performance is a critical element of how we define operational excellence at Barrick,” said co-president Jim Gowans. “This recognition is a testament to our people around the world, who make responsible mining a focus of what they do every day.” Barrick was also included on the

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Barrick Gold

â&#x20AC;&#x153;Our people around the world make responsible mining a focus of what they do every dayâ&#x20AC;?

Dow Jones Sustainability North America Index for the eighth year in a row. In 2013, Barrick contributed $15.2 billion in economic valueadd to its host countries and communities through wages and benefits, royalties and taxes, local purchasing of goods and services and community investments. This included $7.1 billion in developing and emerging countries. The Dow Jones Sustainability

Index evaluates more than 3,000 companies annually using rigorous sustainability criteria to identify top performers. Companies are evaluated on a range of sustainability metrics, including governance, social performance, environment and economic contributions â&#x20AC;&#x201D; taking into account both industry-specific trends, as well as sustainability issues facing multiple sectors.

In 2015 Barrick will be the exclusive provider of gold, silver and bronze for the athlete medals at the Toronto Pan Am and Parapan Am Games.

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Monthly news & features

Mining news in brief: Platts, a leading provider of information for the metals, energy and petrochemical industries, has acquired Munich-based Minerals Value Service GmbH (MVS), a privately held company specialising in determining value-in-use for miners, mills and traders in the iron ore and steelmaking industries. The purchase extends a partnership launched in October 2013 under which Platts took an equity stake in MVS. * * * Global Summit Organiser IRN is launching the inaugural Europe Mining 2015 Summit on 17-18 June in Amsterdam. The event will offer the opportunity to meet the regulatory authorities, investment bodies, mining companies, service and equipment providers responsible for all major mining projects in Europe to discuss current and upcoming business opportunities in the European countries.

Atlas Copco and Anglo American to test FutureSmart machine

* * * Auryn Resources and North Country Gold Corp have announced a joint exploration agreement under which Auryn can earn a 51% interest in North Country’s Committee Bay Project in Nunavut, Canada by spending C$6,000,000 over a 30-month period, at which time the parties will share costs pro-rata in a customary joint venture. Auryn will have ultimate discretion over the nature and manner of exploration undertaken during the earn-in period and will become the operator of the ensuing joint venture, while North Country will provide staff, equipment and consumables as the contractor to implement programs. * * * Lemur Resources has agreed with Brent Trust to purchase a 99.1% stake in Zaaiplaats Mining for R2.5 million, giving it access to the Zaaiplaats tin mining project in Limpopo Province, once the second largest tin mining operation in South Africa, which it believes has “significant extractable tin” in its tailings. Lemur is a curious animal: majority-owned by South African Bushvelt Minerals but listed on the Australian Stock Exchange, its main activity to date has been coal exploration projects in Madagascar. Bushvelt, interestingly, has its own tin mining interests in Limpopo and was close to purchasing Zaaiplaats itself last year.

Two of the mining industry’s flagship companies are working together towards a potential milestone in mining technology. Leading mining and construction equipment manufacturer Atlas Copco and global mining corporation Anglo American are set to test a new type of mining machine that is expected to transform the extraction process of ore from underground hard rock mines. The two companies have been cooperating in a research and development partnership known as FutureSmart since 2012 and their combined efforts, centering on mechanical excavation technology, are now in an advanced stage with proof-of-concept testing scheduled to start in the fall of 2015. “The mining industry needs to be more cost efficient and predictable in its ore production systems,” said Mikael Ramstrom, manager of global strategic projects and alliances who heads up the project team at Atlas Copco. “One way to achieve this is to move towards continuous mining systems based on mechanical rock cutting. If Atlas Copco and Anglo American together prove that this is possible – and we are confident that we will – we can expect it to be a gamechanger for the industry.” The new technology focuses on rapid mine development and on making hard rock mining faster and safer. Underground Rock Excavation is a division within Atlas Copco’s Mining and Rock Excavation Technique business area. Its divisional headquarters and main production center is in Örebro, Sweden. www.ogsmag.com

Major production milestone reached at Ambatovy Sherritt International Corporation has successfully reached a production rate at its Ambatovy mine in Madagascar equivalent to 54,000 tonnes of nickel on an annualized basis (approximately 90% of nameplate capacity), measured over 90 days in a 100-day continuous period. Under the terms of Ambatovy’s financing, ten certificates must be delivered to the lenders to achieve financial completion. Subject to verification by an independent engineer, this achievement delivers the sixth of the ten certificates. Sherritt expects the remaining four certificates (efficiency, environmental, financial, and legal and other conditions) to be delivered by 30 September 2015. “This is a significant milestone in the ramp-up at Ambatovy,” said David Pathe, president and CEO. “We have been determined in our pursuit of this goal and achieving this milestone ahead of schedule is a testament to the expertise and talent of the people across our organization that have contributed to this accomplishment. “Ambatovy is a long-life asset and an essential part of Sherritt’s strategy as a low-cost nickel producer.” Ambatovy is a vertically integrated nickel and cobalt mining, processing, refining and marketing joint venture between subsidiaries of Sherritt (40%), Sumitomo (27.5%), Korea Resources (27.5%) and SNC-Lavalin (5%). Sherritt is the operator of the facilities.

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Monthly news & features

Saskatchewan tax changes could cost PotashCorp C$100 million Changes to potash taxation announced in the Government of Saskatchewan’s 201516 provincial budget are expected to hit the pre-tax earnings of Potash Corporation of Saskatchewan by C$75 to C$100 million. The provincial government is changing the timescale for the annual deductions for capital expenditure on expansion and maintenance, just as PotashCorp winds down its capital expansion projects and incurs higher maintenance capital spending as a result of its expansion. The company has not minced its words in condemning the change. “PotashCorp is disappointed in the announcement today,” said president and CEO Jochen Tilk. “While we understand the difficult revenue situation facing the Government, we are nearing completion of a $6 billion investment in Saskatchewan which was based on the existing tax structure remaining in place. Changing the rules midstream impacts the ability of our shareholders to earn a fair return on their capital and undermines Saskatchewan’s relative competitiveness.” A potash taxation review was also announced as part of the budget release. Responding to that Jochen Tilk said: “A stable, predictable and fair potash taxation system is important for both the province and the industry. Under the current regime, PotashCorp’s operations and investments have created thousands of jobs and continue to support numerous suppliers throughout the province. “We are focused on ensuring that any changes to the existing system continue providing benefits to the people of Saskatchewan, while also protecting the competitiveness of the industry and the long-term interests of our investors, employees and customers. A constructive and consultative review process is an important part of ensuring such an outcome, and it is our hope that the Government will pursue this avenue.” PotashCorp is the world’s largest producer of potash by capacity, and one of the largest producers of nitrogen and phosphate. www.ogsmag.com

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Newcrest Mining

Delivering the future Newcrest Mining Limited, headquartered in Melbourne, WA, is the largest gold producer listed on the Australian Stock Exchange and one of the worldâ&#x20AC;&#x2122;s largest gold mining companies.

Newcrest Mining Limited, headquartered in Melbourne, WA, is the largest gold producer listed on the Australian Stock Exchange and one of the worldâ&#x20AC;&#x2122;s largest gold mining companies. Newcrest dates back to 1966, when Newmont Mining Limited established an Australian subsidiary, Newmont Holdings Limited (which subsequently changed its name to Newmont Australia Limited), to find and develop gold prospects in Australia. In 1990, Newmont Australia Limited acquired Australmin Holdings Limited and merged with BHP Gold Limited (a wholly-owned subsidiary of BHP Limited). The merged entity changed its name to Newcrest Mining Limited. Newcrest owns and operates a portfolio of predominantly low cost, long life mines and a strong pipeline of brownfield and greenfield exploration projects. Its reserve and resource base is strong, with gold reserves representing more than 25 years of production at current rates.

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Newcrest Mining

Newcrest’s asset portfolio includes operating mines that use a variety of efficient mining methods for large ore bodies, together with selective underground mining methods to optimise high-grade epithermal deposits. Discovery of new ore bodies is an important element in Newcrest’s strategy and the company has a strong and successful exploration track record. A key objective of Newcrest’s exploration activities is to secure large mineral districts, or provinces, in order to establish longterm mining operations, while enhancing the potential for further discoveries.

Current operations Cadia Valley Operations (CVO), located in central west New South Wales is one of Australia’s largest gold mining operations and is 100 percent owned by Newcrest. CVO comprises three mines - the Cadia Hill open pit mine, and the Cadia East and Ridgeway underground mines. These are all large-scale mining operations using either block and panel caving or open pit mining methods. The new Cadia East underground mine, constructed at a cost of over $2 billion commenced commercial production on 1 January 2013. At CVO, Newcrest produces gold doré from a gravity circuit and gold-rich copper concentrates from a flotation circuit. Gold doré from CVO is refined at the Perth Mint and concentrates are piped to a dewatering plant at nearby Blayney and sent by rail to Port Kembla in New South Wales for export mainly to Eastern Asia. Over 8 million ounces of gold has been produced from CVO since commercial production commenced in 1999. Newcrest continues to explore areas around existing mines to expand reserves that will support the development of additional production capacity in this large mineral district. CVO undertakes a range of environmental reporting and monitoring activities, to ensure that the mine maintains a safe environment for employees, operating and developing mines in line with good environmental practices and embracing a strong sense of commitment to local communities. The Telfer gold-copper mines in the Great Sandy Desert in the East Pilbara region of Western Australia are 100 per cent owned by Newcrest. Telfer is a remote location, 400 kilometres east-south-east of Port Hedland and approximately 1,300 kilometres by air or 1,900 kilometres by road north-east of the state’s capital,

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Newcrest Mining

Perth; therefore is run as a fly-in-fly-out operation. Telfer comprises the Main Dome and West Dome open pits and the Telfer underground mine. Ore from the mining operations is processed by a large, dual train, communition circuit, followed by flotation and cyanide circuits, which produce gold doré and copper-gold concentrate. The process is complex because of the need to accommodate differing ore types. Copper-gold concentrates produced at Telfer are filtered to produce a dewatered concentrate, which is trucked to Port Hedland and exported to various smelters, primarily in the East Asia region. The gold doré produced at Telfer is refined at the Perth Mint. Approximately six million ounces of gold were produced between 1975 until Telfer’s closure in 2000, with over four million ounces of gold produced since operations recommenced in 2004. The near mine environment contains a number of semi-to-advanced exploration targets, which have the potential to deliver new growth for Telfer. The project also contains a large regional tenement package that extends over 1,000 square kilometers. Application of a new exploration model has identified a number of regional targets. Telfer has a strong relationship with local communities, which consist predominantly of indigenous groups, principally the Martu. All infrastructure development and services are provided through direct consultation with the Martu, their communities and their community management personnel. Its environmental priorities include flora and fauna, land and water, air and noise, waste, rehabilitation and mine closure. A key environmental issue at Telfer is the management of cyanide, which is used as part of the process for recovering gold in the processing plant. Newcrest is a signatory to the ‘International Cyanide Management Code for the Manufacture, Transport and use of Cyanide in the Production of Gold’, and is implementing a program to ensure code compliance at Telfer. The Lihir operation on Niolam Island in the New Ireland Province of Papua New Guinea (PNG), 900 kilometres north-east of Port Moresby, is 100 per cent owned and operated by Lihir Gold Limited (LGL). Newcrest acquired the Lihir operation as a result of the merger with LGL by court-approved scheme of arrangement in August 2010. The gold deposit at Lihir is within the Luise Caldera, an extinct volcanic crater that is geothermally

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Newcrest Mining

active and is one of the largest known gold deposits in the world. Most of the ore is refractory and is treated using pressure oxidation, before the gold is recovered by a conventional leach process. Lihir produces gold doré. Since production commenced in 1997, the site has produced more than 9 million ounces of gold. At the end of January 2013, Newcrest commissioned a major expansion of the Lihir process plant including installation of a new crushing facility, upgrades to the ore processing plant, and additional power generation capacity and water supply. The expansion increases plant capacity and operational flexibility and reduces exposure to single pieces of equipment. Exploration has extended the mineralisation to the East with the discovery at the Kapit North East Exploration target. The mineralisation remains open to the East. Lihir supports PNG-based suppliers and businesses where possible, consistent with our commitments to landowners and the PNG Government. We also contribute to the local economy in accordance with agreements with the government and landowners by providing public infrastructure and services, including access to health services and the provision of electrical power and water to local villages.

Hidden Valley Hidden Valley is located in the highly prospective Morobe province in Papua New Guinea, approximately 300 kilometres north-west of the nation’s capital, Port Moresby, and 90 kilometres south-west of the sea port of Lae. The operation is owned by the Hidden Valley Joint Venture (HVJV), one of three unincorporated joint ventures between subsidiaries of Newcrest (50 per cent) and Harmony Gold Mining Company Limited of South Africa (50 per cent). Hidden Valley is an open pit gold and silver mine, consisting of three main lodes – Hidden Valley, Kaveroi and Hamata. Gold and silver doré produced at Hidden Valley is transported to the Perth Mint in Australia to be refined. Construction of the Hidden Valley mine began in 2007 and commercial production commenced in September 2010. The joint venture is continuing to ramp up operations to target annual production of 250,000 ounces of gold and 2.5 to 3 million ounces of silver. The mine sits within the New Guinea Mobile Belt of Papua New Guinea which is one of the world’s pre-eminent geological terrains for porphyry

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PPi is currently assisting Newcrest at the Lihir operation providing services for autoclave maintenance and process optimisation. This includes specialist process engineers and multidisciplinary trades personnel that are capable of completing field work and returning plant to operations ready for start-up. The level of rigour that PPi enforces is expected to assist with improving the reliability of the Lihir operations, which is a key target for Newcrest. PPi was created to support clients with the arduous duties of operating autoclaves in base metals and pressure metals projects. PPi hand picks the appropriate team to work with clients anywhere in the world. We know the harsh highlands of Porgera PNG, the coastal waters of Lihir PNG, the winters of Macraes NZ and the red dust of Murrin Murrin. And we enjoy a challenge. Current locations of projects that PPi is involved with include Australia, Papua New Guinea and Russia. This multi-discipline approach maximises efficiency and minimises durations. It also provides autonomy to the HPAL team, facilitating the necessary isolations, testing and other general work activities that modern work practices now demand. A successful start-up requires all stages of project development, implementation and operation to be suited for your particular ore deposit. The PPi approach has been developed from our involvement with 11 gold autoclaves and 11 nickel autoclaves. PPiâ&#x20AC;&#x2122;s one-team approach cuts time, saves money PPi eliminates the time-consuming and costly task of having to recruit, assemble and coordinate a diverse number of individuals typically required for project start-up. Our personnel have a range of skills that cover numerous industries. We provide our clients with a seamless, ready-made team of specialists, offering: A one team approach from construction completion, commissioning, start-up to ramp-up and ongoing maintenance A single point solution for new plant start-ups that will transition seamlessly from construction handover, through ramp up, to first maintenance shutdowns Complete integration with client project and operation teams Safety, once and right, with the degree of rigor to ensure success Remote site fly in fly out specialists anywhere in the world Detailed weekly status reports so you know what is happening each step of the way. Each report includes milestone achievements, forecasts, variations, slippage and additional work, issues and concerns, general activities and personnel details. Training of HPAL and POX Personnel We consider the training of our clientsâ&#x20AC;&#x2122; personnel an integral part of our services. 36

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PPi provides world-leading services to projects reliant on autoclaves. Our skills range from process development through detailed design, construction, commissioning and, most importantly, â&#x20AC;&#x153;making it workâ&#x20AC;?. PPi regularly work with clients beyond the project implementation phase into specialist maintenance and process optimisation. Our personnel train and mentor operating and maintenance personnel to ensure that autoclaves operate reliably. We have developed advanced process control technology that simplifies the operation of autoclaves reducing the reliance upon highly skilled operators. Contact us at: www.processplants.com.au enquiries@processplants.com.au +61 417 965 870

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Newcrest Mining

copper-gold and epithermal gold mineralisation. The belt is host to several world-class deposits. The Hidden Valley - Wau corridor is a world-class historic mining district with exploration upside. Hidden Valley is predominantly a fly-in-fly-out operation, located in a high rainfall area at an altitude of around 2,000 metres. Several permanent streams contribute to significant water run-off from the site, so water quality, soil stabilisation, waste management, and containment of tailings are closely monitored. Water used in the process plant is recycled which reduces the amount of fresh water required from local water sources. The construction of a 4.5 kilometre overhead conveyor to carry ore to the mill further lessens the impact of the mine on the natural environment, by reducing the need for trucks and haul roads.

Bonikro Bonikro in Côte d’Ivoire, West Africa, is owned and operated by LGL Mines CI SA, an Ivorian company 89.89 per cent owned by Newcrest. Bonikro is a conventional truck and excavator open pit mine, producing gold doré. First gold was poured in October 2008. The predominant method of gold recovery is via carbon in leach technology, with some gold recovered via a gravity circuit. At Bonikro the potential exists to increase the mine life by discovering additional satellite deposits that may be processed through the Bonikro facility. Mining at the Hire Deposit (12 kilometers South-East of Bonikro) commenced in late 2014 and further exploration is being undertaken to identify new deposits within a 30 kilometers radius of Bonikro. Newcrest holds three mining licences in the Bonikro near-mine area. In addition to the Bonikro near-mine area, Newcrest has interests in some 3000 square kilometers of regional tenements and tenement applications within Cote d’Ivoire. Recent consolidation of the tenement package has resulted in focused activity on the most prospective tenements, which are all located within highly prospective Birimian greenstone terrains. Newcrest has a committed exploration campaign in Cote d’Ivoire, aimed at discovering a major gold resource. Newcrest has also established a West African generative group, which is currently assessing a range of gold and copper opportunities across the region from greenfield projects right through to producing assets.

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Newcrest Mining

Newcrest aims to leave a positive legacy in Côte d’Ivoire by creating jobs and improving living standards for Ivoirians. An agreement was signed with the United Nation Development Program (UNDP) to develop and implement a sustainable community development program in the Bonikro area through a partnership that will ensure financial leverage from other donors. Implementation of the partnership started in January 2012 with the UNDP agreeing to a local development plan in collaboration with all the stakeholders. Gosowong is owned and operated by PT Nusa Halmahera Minerals (PTNHM), an Indonesian company 75 per cent owned by Newcrest. It is located on Halmahera Island, in the North Maluku Province of the Republic of Indonesia, approximately 2,450 kilometres north east of the national capital, Jakarta. Gosowong produces gold and silver doré. The processing plant at Gosowong, which has a capacity of up to 800,000 tonnes per year, comprises a primary jaw crusher followed by a SAG and ball mill circuit and a recently completed Vertimill circuit. The ore then undergoes a conventional cyanide leaching process. Gold and silver is recovered from the cyanide solution using the Merrill-Crowe zinc precipitation process, and is smelted to produce gold doré. Gold and silver doré produced at Gosowong is refined in Jakarta. Since mine operations commenced in 1999, over four million ounces of gold and three million ounces of silver have been produced. The Gosowong exploration program is focussed on testing a portfolio of priority exploration targets within the vicinity of present operations and advancing a number of targets within the regional Contract of Work. More than 98 per cent of Gosowong’s total workforce, and 75 per cent of managers, are Indonesian. PTNHM invests extensively in community initiatives through its Corporate Social Responsibility program, committing one per cent of annual revenue to the program to share the benefits of mining, support community needs and strengthen socio-economic development in the region. PTNHM’s commitment to the local economy is further demonstrated by implementing a policy of preferring locally based suppliers, where possible.

Future opportunities Wafi-Golpu is an advanced exploration project located in the Morobe Province of Papua New Guinea (PNG),

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Newcrest Mining

approximately 65 kilometres south-west of the port city of Lae, PNGâ&#x20AC;&#x2122;s industrial hub and second largest city. The project is owned by the Wafi-Golpu Joint Venture (WGJV). Deep drilling conducted by the WGJV since 2008 has identified a world class porphyry deposit at Wafi-Golpu (the Golpu deposit) suited to bulk underground mining techniques, similar to those being employed by Newcrest at Cadia Valley Operations. Currently, the Wafi-Golpu project includes the Golpu copper-gold porphyry deposit, the Nambonga coppergold porphyry deposit and the Wafi high sulfidation epithermal gold deposit. Exploration activity to date has shown that the Wafi-Golpu tenements host one of the highest grade porphyry copper systems in southeast Asia (the Golpu deposit). The Golpu deposit is one of several porphyry ore bodies identified along the 25 kilometre long Wafi-Transfer. Newcrest and its joint venture partner are actively exploring this highly prospective terrain for additional deposits. In December 2014 Newcrest and Harmony approved a stage one feasibility study of the Golpu project. Stage one would target the upper higher value portion of the ore body via two block caves with an approximate mine life of 27 years. Ore would be conveyed to a nearby surface process plant which would produce a coppergold concentrate. Annual production would be expected to peak in 2025 at 320,000 ounces of gold and 150,000 tonnes of copper. During 2015 work will continue on updating the 2012 Golpu PFS for stage two of the project. Both the stage one feasibility study and the updated PFS for stage two are scheduled to be complete by December 2015.

Fiji The Namosi Joint Venture (NJV) is exploring for mineral resources in the Namosi and Naitasiri provinces in Fiji, approximately 30 kilometres west of Suva. The project covers an area of approximately 724 square kilometres. Namosi is owned by the Namosi Joint Venture (NJV), an unincorporated joint venture between Nittetsu Mining Co Ltd (Nittetsu), Materials Investments (Fiji) Ltd and Newcrest (Fiji) Limited (Newcrest). The Waisoi Project is a copper and gold project in the pre-feasibility phase. An environmental impact assessment is underway to assess the potential social and environmental impacts of a mine at Waisoi. The EIA process will help

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Newcrest Mining

the Government decide if a mine at Waisoi can be built in an environmentally acceptable manner. A key component of the EIA is the social impact assessment, which will consider potential impacts, mitigations and opportunities. Following the Government’s decision, the NJV will determine if the Waisoi mine can be operated safely and economically and in an environmentally sustainable way. Exploration activities at Namosi are currently focused on the large Waisoi copper-gold deposit, the mineralised Waivaka Corridor and a portfolio of early stage exploration targets. Waisoi consists of two deposits, Waisoi East and Waisoi West.

Exploration opportunities Discovery of new ore bodies is an important element in Newcrest’s business strategy. Through exploration, Newcrest seeks to identify and secure large mineral districts, or provinces, in order to establish long-term mining operations, while enhancing the potential for further discoveries. Exploration at Newcrest comprises organic greenfield and brownfield exploration activities, augmented by identifying and securing exploration prospects at various stages of maturity through joint ventures with exploration juniors, together with targeted mergers and acquisitions activity. Newcrest has a strong track record of discovering major deposits over the past 15 years, including the discovery of deposits at Cadia Hill, Cadia East and Ridgeway (all part of Cadia Valley Operations, in New South Wales, Australia), the Gosowong deposits in Indonesia, O’Callaghans at Telfer and in more recent times the Golpu discovery in Paupa New Guinea. Newcrest today has ongoing brownfield exploration programs in and around our operating mines and continues to search for and explore new greenfield regions that have the potential to deliver the next generation of discoveries. Exploration success requires skilled and capable people supported by industry leading systems, processes and governance. Newcrest has a strong exploration team with established experience in the successful discovery of porphyry and epithermal deposits. These are well suited to Newcrest’s experience in bulk underground mining.

Use of Technology Increasingly, gold deposits are becoming more difficult

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Newcrest Mining

to find. They are lower grade, of challenging metallurgy, deeper underground, more difficult to develop and located in geographies that present logistical, development and operating challenges. In competition to these trends, Newcrest has a strong history of growth over the past 20 years, obtaining value from previously marginal, difficult ore bodies. It has developed mining and ore processing technology for the efficient extraction of copper as concentrate, gold as bullion and gold in copper concentrate. Examples include Cadia Hill, Ridgeway, Telfer, Cadia East and Wafi-Golpu. An important element of Newcrest’s strategy is thus the adoption, adaption and development of innovative underground mining techniques and metallurgical processes, including: innovative geo-metallurgy knowledge approaches, adapting more continuous underground and pit systems, technology to facilitate early waste rejection to avoid high energy processing downstream, technology to lower energy required for mineral processing. Newcrest’s ‘Future mine’ vision is to utilise technology, along with continuous improvement techniques and step change methodology, to significantly reduce operating costs across its portfolio and increase production reliability. Newcrest’s vision is to be the miner of choice for all stakeholders including its workforce, the communities in which it operates and its shareholders. Social responsibility, safety and sustainability are fundamental guideposts to the Newcrest vision.

World Mining Magazine

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Thinking about economics: Metal mining outlook

By Dr. David L. Blond, President, QuERIInternational 50

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Thinking about economics In today’s uncertain world economy, the future, logically, looks bright. Country after country during the past two decades has moved from marginally developed to a new category of emerging markets. As middle class wealth has increased, so too has the demand for goods, services, and infrastructure investments to meet the growing needs for raw materials, the building blocks of these life styles. The result has been a strong demand for raw materials. This boom has led to rapid, and sometimes impossible, spikes in prices of raw material. The financial disaster of 2008-2009 led to a rapid drop in prices, followed by a quick recovery, and the forecast developed by the Economist Intelligence Unit has a trend growth of around 2% starting in 2015, after the negative growth of the last two years. This extreme volatility in prices is due in part to the long lead time between investment in new capacity (mines) and the delivery of the ores to the market. The question then in everyone’s mind is – when will the boom turn into bust, and when will the bust turn into a boom? In truth, it is a wonder that any new investments are made to meet the growing demand of world industry. The QuERI baseline suggests that demand for raw materials including primary ores and metals will continue to grow at rates exceeding the overall growth in world output once this period of

Source: Economist Intelligence Unit, Index of Metal Manufactures Prices

uncertainty ends. In the table below, developed using a global modeling system that integrates the requirements of companies for intermediate inputs in the manufacturing process, and international trade, we can see that the expected, real growth in demand should continue. The likely path of future global growth was set in the development of thriving middle classes in many parts of the world long dominated by a narrow concentration of wealth. The advent of global supply chains has meant that more distant markets have been developed. To support these new manufacturing centers, infrastructure has had

to be developed as well. As wages have risen in these countries, other services have been required, and this virtuous system of self-supporting growth has meant that less developed economies have made the leap into the globalized world trading system. All this has meant that demand for minerals, as measured by market demand, has increased at a rapid rate.

“The advent of global supply chains has meant that more distant markets have been developed” The global demand for metal mining products was around $700 billion dollars in 2010, increased to an estimated $900 billion by 2015 and is forecast to reach $1.7 trillion dollars in 2020. The real growth in demand is fastest in Asia with a compound annual growth forecast of 11.5% in volume (eliminating price and exchange rates changes), almost double the earlier growth of 6.2% for the region. This is despite a likely slowing down in the China investment boom. The question then for the industry – should we believe these rosy results or question if these kinds of growth are possible? What we do know is that without additional investments in new mines, mills and transportation infrastructure, this potential boom will not be met, and that the result will be rising prices and the increased use of other materials in finished products.

QuERIdata.com Market Size and Performance Reports Global Market Demand & International Trade Summary Regional Market Edition, Base Year 2015 Product Name ISIC3 Code MetalOreMining C2122 ISIC2 Name Broad Code Name Mining & Extractive Mining and Quarrying Concept World North America Europe Asia South America Middle East Africa Market Size (Billions 2015 US$) 896.5 65.7 120.2 568.9 50.7 76.2 14.7 Share of World (2015) 100 7.33 13.41 63.46 5.65 8.5 1.64 Import Share of Market Demand (%) 28.12 10.24 26 36.65 3.84 4.15 3.31 Market Size (Billions 2010 US$) 630 63.08 117.76 336.75 39.66 57.39 15.38 Share of World (2010) 100 10.01 18.69 53.45 6.29 9.11 2.44 Market Size (Billions 2020 US$) 1743.48 112.88 201.37 1164.31 92.34 143.87 28.73 Share of World (2020) 100 6.47 11.55 66.78 5.3 8.25 1.65 Past 5 yr Vol.CAGR(%) 4.74 1.46 1.51 6.26 2.92 3.13 5.19 Next 5 yr Vol.CAGR(%) 9.29 3.71 3.19 11.53 6.98 7.98 10.31 Last Years Vol.GR(%) 4.56 0.52 -0.13 7.34 -0.4 2.82 4.92 Next Years Vol.GR(%) 4.81 1.04 1.54 6.93 1.19 2.6 5.17

Source: www.QuERIData.com, a global data base of industry and trade data. January, 2015 baseline.

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Aquamate: Water-tight technology An audacious gamble backed by a quest for perfection and commitment to adaptability is now paying huge dividends for a water tank maker in South Australia. 52

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Aquamate

In 2011, managing director Danny Di Iorio and his team at Aquamate risked everything in a pitch to mining giant Santos, which could have left the manufacturer high and dry. “In 2011 we approached Santos and proposed that if our tanks were to leak more than 10 litres, we would call them non-conforming – we would go away and you would never hear from us again,” explains Di Iorio. A bold statement by any measure, especially when the tanks in question hold a staggering 16 million litres combined. Aquamate’s focus is on quality of product, and Di Iorio is in full control with the company’s South Australian warehouse manufacturing its product from start to finish. The 6000-metre-square warehouse features the longest fabrication facility in the country with a 120-metre-long section specifically for the production of the geomembrane linings that hold the water in the tanks. In 2001, Danny and his wife bought the business as sole operators, just months after their second child was born. “Back then we were servicing the farming industry and housing market,” says Di Iorio. “We then carefully evolved our business by adding specialised sectors to meet demand.” In 2004 they added a steel fabrication facility to assist with quality control and in 2008 they created a liner fabrication process which helped to manufacture critical components of the tanks’ structure. Aquamate first aligned its strategic objectives to the resources sector in 2010 and within two years their first 1-million-litre tank was on the ground in the Cooper Basin in the north of South Australia. In 2013 an ongoing operation was in place and 2014 saw Aquamate employ full time workers in the Cooper, with its own warehouse and training facilities for the geomembrane installation. Now 95 percent of each tank is made

in South Australia, and much of it is made on site. “It’s something we are very proud of. We try, as much as possible, to take the factory into the field; that way we can do a large percentage of the work in a controlled environment leaving just the install of the tanks on site,” says Di Iorio. Another important part of the Aquamate model is its zero leaks culture. “We saw an opportunity in the industry to raise the bar and do things better than were previously being done. In the early stages of our operations we took a no tolerance approach to leaks in our tanks. It’s something we still hold in high esteem today.” Another evolving practice has been the employment of skilled people. Between 2001 and 2008 Aquamate employed between six and twelve people depending on seasonal demand. Since targeting the resources sector in 2010, Aquamate’s workforce has increased to 40 full time employees, including those based in the Cooper Basin. “It’s no secret the resources sector is a key component to our business. We have come a long way since 2001, bringing in varying roles and diversifying our approach for new skills within our organisation,” says Di Iorio. Last year expansion was created through the installation and lining of a 40-million-litre pond in the Cooper Basin to address the lack of water storage there. Applying the same technology used on their tanks, Aquamate was able to prepare the linings while the civil work was completed to line the ponds, immediately saving valuable time. “It worked really well for us. While Santos was laying the civil work we were able to do all of the manufacturing at our warehouse in Adelaide and could then begin laying the lining at a rate of 10,000m2 a day.” The persistence, quality of product and pride of workmanship credits Aquamate with their portfolio of work in the resources sector throughout South Australia. Our thanks to The Lead South Australia, for permission to publish this article. www.ogsmag.com

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