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March 2013

FULL THROTTLE Fortescue’s Nev Power talks production targets


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61 Managing Editor: Michael Cairnduff Editor: thomas Smith Contributing Editor: tim treadgold Journalists: alison Middleton, Vetti Kakulas Production Manager: Mata henry Senior Layout Designer: Diane thornley Layout Designer: Catherine hogan Chief Sub-Editor: Gerald Bradley Sub-Editors: Melanie Jenkins, Maxine Brown Contributors: Robin Bromby, Michael pascoe, John Mcilwraith, Stephen Bell National Sales Manager: angela Smith Advertising Sales: Richa Fuller, nigel D’Silva, Vanessa Monastra, paul Morgan Advertising Production: isaac Burrows ( Subscriptions: ph: (08) 6263 9100 email: 12 issues per annum – australia $a156.00 (GSt included); Regional (pnG, nZ, Se asia) $a252.00; international $a300.00 Executive: Colm O’Brien – Chief executive Officer trish Seeney – General Manager John Detwiler – Chief Financial Officer Head Office: australia’s Mining Monthly, 613-619 wellington Street, perth, western australia 6000; pO Box 78, leederville wa 6902 ph: (08) 6263 9100 Fax: (08) 6263 9148 email:,, website:, COpYRiGht waRninG all editorial copy and some advertisements in this publication are subject to copyright and cannot be reproduced in any form without the written authorisation of the managing editor. Offenders will be prosecuted. Australia’s Mining Monthly average audited monthly circulation: 8,269

Cover Story


Man with the plan in an interview with Australia’s Mining Monthly, Fortescue Metals Group chief executive nev power outlines his plans to get the company back on track.


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21st century mining From the humble pick and shovel to GPS-guided, autonomous vehicles. Welcome to mining 2013.


y grandfather was a coal miner. For more than 50 years he worked alongside brothers, uncles and friends in every type of pit and coal mine imaginable. When he retired in the 1970s he brought home the pick axe he used during his last ever shift. In fact, to this day my father still has that simple tool. He still uses it, occasionally, to shift a stubborn tree root or paving slab. If my grandfather was alive today, he wouldn’t recognise the industry that accounted for his entire career, boy and man. I remember him telling me about the pit ponies that spent their entire working life underground, only to finally emerge into the daylight upon retirement, blind. Today? We have GPS-guided, autonomous

vehicles. Machines that use laser guidance for pinpoint accuracy. That’s quite a contrast. I was reminded of this when I reviewed the March edition of Australia’s Mining Monthly. This month we launch a new feature – Mining Recruitment. We have also recently expanded the regular Mining Software feature. The skills and technology in operation today couldn’t be more different from those employed by the first Australian miners in the 1800s. As the need for labour lessens, thanks to improving technology, the focus on sourcing specific skills intensifies. These two features – Mining Recruitment and Software – tackle

Tools of the trade: Pick and shovel.

these key issues which so massively affect modern mining. As for mining from my grandfather’s era and beyond, more on that in our April issue ... Enjoy the March edition of Australia’s Mining Monthly.

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Cover Story

Next stop: Recovery

Happy second anniversary to Fortescue Metals Group CEO Nev Power. The FMG chief talks to Australia’s Mining Monthly about hitting the planned 155Mtpa production target and plans to re-hire 1000 sacked workers. By Stephen Bell


ower struggles don’t come much bigger. Six months ago, Fortescue Metals Group chief executive Nev Power was in the fight of his life as iron ore prices fell out of bed. Battling to keep the wolves at bay, Power had to urgently refinance the miner’s debts and sack 1000 workers in the space of a few dramatic weeks in September. So drastic was the cost cutting that FMG even told workers at its Anderson Point facility at Port Hedland it would no longer fund staff barbeques. Now, as Power heads toward his second anniversary in June, the CEO is on a firmer footing. He faces a less stressful dilemma: how to deliver promised cost savings and a $US9 billion expansion as the resurgent iron ore price eases concerns about Fortescue’s stretched balance sheet. At the time of writing, spot iron ore prices


had rebounded roughly 70% from their nadir of $US86 a tonne hit during last year’s crisis. The volatility was a trifle disconcerting. Not that Power was complaining, as he targeted completion of the company’s long-promised expansion to 155 million tonnes per annum by year end. In fact, the former engineer who grew up on a Queensland cattle ranch was almost in celebratory mode, stating that he was in for the long haul. “I’m having a ball, so I haven’t made any other plans beyond Fortescue,” Power told Australia’s Mining Monthly. It was a bold statement of intent, particularly in light of the chopping and changing at other Pilbara miners, with former Rio Tinto Iron Ore chief Sam Walsh recently moving to London to take on the company’s top job. This followed BHP Billiton Iron Ore’s changing of the guard last year that saw Jimmy Wilson take up the Pilbara reins for the global miner.

Unlike the Big Two, however, Fortescue doesn’t enjoy the comfort of bottom quartile operating costs. “My focus is on delivering the 155Mt expansion, starting a debt-reduction program once we’ve got our production up, and paring away at those costs,” Power said. With the benefit of hindsight, Fortescue probably could have done things differently in the lead-up to the crisis. Its decision in June 2011 – when Power replaced Andrew Forrest as CEO – to bring forward the expansion timetable by 12 months exacerbated the group’s debt crisis when iron ore prices collapsed 14 months later. But Power points out that nobody foresaw the drastic plunge. “None of the analysts, none of the forecasters and, importantly, the Chinese didn’t forecast it,” he said. “So that gave us concern at the time as to how long it would take to recover from that.”


Fortescue Metals Group: Won’t stop till it hits 155Mtpa.

Fortescue used the downturn as an opportunity to ensure it had the “absolute resilience” to see through further volatility, Power said. Critically, it bought breathing space by winning a $4.5 billion debt refinancing package, while seeking $1.6 million in cost savings by reining back the Solomon expansion, cutting overheads and selling assets – including a power station and a minority stake in the Nullagine joint venture. Even a fleet of 40 caravans at Port Hedland was put on the block. A decision on Fortescue’s planned sale of a minority stake in its port and rail assets was due late March. “It was a pretty comprehensive review of the organisation triggered by the iron ore price, but nevertheless a process we would have progressively gone through in any case,” he said. Power had just passed his first anniversary as CEO when he started wielding the axe to deal with the perilous price fall that had pushed FMG’s operations close to loss-making territory. Now he’s cast in a more saintly role, hiring workers for the reinvigorated expansion work. By mid-year, when mining is due to start at the Kings project, FMG estimates it will have taken on


KEY FACTS • Fortescue CEO Nev Power approaching second anniversary • Pilbara miner aiming for long-promised 155Mtpa production rate • US$9 billion expansion gathers steam with Kings project restart • Kings and nearby Firetail projects drive planned operating cost cuts • Iron ore price rebound gives Fortescue relief as asset sales continue

1000 contractors, roughly the same number of workers cut in September. The new staff will man expansion projects at Christmas Creek (courtesy of Macmahon), Firetail (the new Solomon mine operated by Leighton) and Kings (the second Solomon mine). Kings was put on hold for three months but revived just after Christmas in light of the price rebound. Its restart should allow a ramp-up to full capacity by the end of this year, enabling the overall expansion project to be completed on budget, Fortescue said. The Kings re-launch also allowed a smooth

transition of construction workers from nearby Firetail, which is ramping up to 20Mtpa in the March quarter. Power may not be the Prince of the Pilbara just yet, but he certainly has a lot riding on Kings, which at a forecast 40Mtpa rate will be the biggest contributor to the new Solomon hub. At the time of writing, Fortescue was sifting through contractor submissions with an eye on starting overburden removal at Kings “circa May or June”, Power said. Around 80Mt of waste and 40Mt of ore needs to be shifted each year, and the contractor will be under plenty of scrutiny given FMG’s focus on slashing operating costs. A Yandi-look-alike channel iron deposit, Kings is a vital cog in the CEO’s efforts to reshape Fortescue from marginal producer into one that can tough out future downturns. The project is roughly two parts waste to every tonne of ore, a much more favourable stripping ratio than Fortescue’s original Chichester mines at Christmas Creek and Cloudbreak. Power pointed out that Fortescue had already spent much of its budgeted $US9 billion on infrastructure, including rail, much of the port, and Kings-specific


Cover Story kit such as crushing stations and conveyors. “We’ve spent a lot of the money for Kings without getting the benefit of the production from it, so we’re very keen to complete that.” The new tonnes from Kings and Firetail will help drive down long-term operating expenses. Both projects are designed to have sub-$30 per tonne cash costs, compared with the roughly $50/t costs at the Chichester mines. Thus FMG’s overall cash costs will tumble to less than $40/t if the new Solomon mines perform as expected.

“I’m having a ball, so I haven’t made any other plans beyond Fortescue.” – Nev Power Along with more favourable waste-to-ore ratios, the CEO is banking on technology to save him a few dollars at Solomon, as Kings will become an effective testing laboratory for Caterpillar’s new automated trucking technology. A fleet of 45 automated Cat units should be ready to roll come the start of overburden removal mid-year, Power said. This would see FMG join other Pilbara miners – Rio Tinto is ramping up its Komatsu automated fleet – in trying to capture the supposed productivity benefits of using driverless trucks. Rio’s Komatsu fleet includes 10 driverless 930-E trucks. The miner plans to take delivery of 150 more automated units in the next three years. BHP Billiton, meanwhile, is trialling autonomous Caterpillar haul trucks at its operations in Navajo, New Mexico, in the US. Power is hoping for increased efficiency from the Cat experiment. “You get a much more consistent run – the trucks go exactly to the right dumps and

Flying the flag for Australia: the first train from Solomon on the Fortescue Hamersley Line, December 2012.

ore ROM pads, so the productivity should be significantly higher than a conventional truck,” he said. And doing without a human driver has a pay-off in terms of reduced downtime. “The only time they stop is for refuelling or maintenance,” said Power. “You don’t need to stop them to clean windscreens, have smoko breaks, toilet stops or anything else,” Power said. But what about those surface miners, the heavy machines launched with quite a bit of fanfare when Fortescue opened up its Chichesters deposits four years ago? Both

Big step towards 155Mt: Nev Power at Herb Elliott Port.


Firetail and Kings will avoid surface mining, instead opting for conventional drill, blast, load and haul methods. Power attributed this to geological differences at Solomon, which contains deeper, bulk-style orebodies compared with the flat, thin-seamed Chichester deposits amenable to surface stripping. The Solomon deposits, in contrast, have a compact surface “footprint” and extend to depths of 100m. “It does allow us to use very conventional bulk mining methods,” Power said. Bringing Kings on line with no hiccups would cap the rehabilitation of Fortescue, which lost face with investors last year after its expand-at-all-cost mentality left it too exposed to falling prices. The price rebound has made Power’s job easier this year, but the market probably won’t get too excited until it sees the outcome of further asset sales and the Solomon ramp-up. Given those urgent priorities, don’t expect to see Fortescue devote much time to second-tier hobbies such as copper hunting in South Australia. Last year, FMG revealed it had applied for more than of tenements in the broader Olympic Dam region, with an eye on diversifying into the metals business. But the leases are still going through works approval processes, so any copper drill hits are a long way off. “It’s something that we’ll get to once we’ve bedded down our 155Mt and paid down our debt,” Power added.

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Mining Brief

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FIFO ‘cancer’ A hard-hitting federal government report has described fly-in, fly-out practices as “a cancer” to communities. By Alison Middleton

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ly-in, fly-out practices are “a cancer” to traditional resource communities, according to a federal government report. The report, tabled by the House of Representatives Standing Committee on Regional Australia following a parliamentary inquiry, said that some mining companies appeared to be oblivious to the damage FIFO caused. The report was titled Cancer of the Bush or Salvation for Our Cities? Fly-in, fly-out and drive-in, drive-out workforce practices in Regional Australia. The inquiry heard extensive arguments from both sides of the debate. It considered the benefits high wages and time at home brought to FIFO/DIDO workers and their families. Included in the report were Kalgoorlie-Boulder mayor Ron Yuryevich’s views that FIFO was the “cancer of the bush”. Mayor Yurevich also said that the practice was eroding the way of life in traditional mining communities like Kalgoorlie, Karratha, Mt Isa, Broken Hill and Moranbah. Subsidisation of FIFO/DIDO work practices through taxation concessions to mining corporations also distorted the capacity of workers to make the choice to live and work in regional communities, the report stated. And a lack of empirical evidence meant that state and federal governments had no capacity to respond to the FIFO phenomenon in a way that would support regional communities. Health services, skills shortages, economic impact and social cohesion were among the issues tackled in the report. Committee chairman MP Tony Windsor said: “The committee commenced this inquiry not knowing what it would find. What the inquiry found was a dearth of empirical evidence. “This means that the state and federal governments have no capacity to respond to this phenomenon in a way that will support regional communities. “Corporate employment choices became the regional Australia policy of many governments, this is unacceptable. “There are simple and practical measures that can be put in place to provide more incentive for FIFO/DIDO workers to become residential workers. “Foremost, governments at all levels must acknowledge that, for some communities – particularly those traditional resource communities – FIFO/DIDO is a cancer. “But for operational positions located near existing regional communities every effort should be made to make FIFO/DIDO the exception rather than the rule. A total of 21 recommendations were made. These included strategies and targets for achieving fair access to health services for people living in regional and remote areas. The committee recommended the commonwealth government review the Zone Tax Offset arrangements to ensure they were only claimable by permanent residents. The review should also remove the exempt status of travel to and from the workplace for operational phases of regional mining projects, the report said.

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Le largest The world’s largest surface wheel loader has been released to the Australian mining industry. By Vetti Kakulas


S wheel loader specialist LeTourneau Technologies has launched its latest L2350 generation 2 wheel loader. The larger and more economically advanced wheel loader was showcased at an event in Perth, Western Australia. Australia’s Mining Monthly attended the exclusive event, along with more than 130 mining personnel at LeTourneau’s Perth headquarters. It’s not until you stand right on top of the world’s largest loader that you can really appreciate its size. The L2350 is 20.27m long, 6.73m high and 7.58m wide and it can lift a massive 72 tonnes every payload for 400t trucks. According to mining equipment manufacturer Joy Global regional loader


“The loader has evolved because miners wanted to move more material at a lower cost per tonne and this is the biggest loader in the world that can do that.” – John Coughlan

sales manager John Coughlan, the loader’s SR Technology was a pivotal part of the generation 2 machine. “It holds energy and turns off the engine so the energy caption can be used without the engine working, resulting in cheap fuel consumption,” Coughlan said. “The loader has evolved because miners wanted to move more material at a lower cost per tonne and this is the biggest loader in the world that can do that.” Joy Global acquired LeTourneau Technologies in May 2011. The generation 2 has improved safety

features, including payload inhibitors which stop the machine from tipping and are said to keep operators safe. Additionally, the cab has five monitors to notify the operator of any safety risks and to provide location specifics and a reverse camera. “We’ve carried out risk assessments on the loader, covering everything as far as safety goes,” Coughlan said. Joy Global’s headquarter is in Wisconsin, US and the firm has support facilities throughout Australia.


Inside the L2350 generation 2 chassis. The world’s biggest wheel loader, LeTourneau’s L2350 generation 2.



Mining Brief

Wealthy valley A recent report says the mining industry has had a positive impact on the Hunter Valley. By Vetti Kakulas


ore people own homes in the Hunter Valley region of New South Wales than in any other Australian mining region.

Coal mining in the Hunter Valley has created economic benefits for the region.

A report released by professional services firm KPMG has revealed that 70% of residents in the coal-rich Hunter Valley are homeowners.

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In Queensland’s Galilee Basin, home ownership stands at 66% and in Western Australia’s Pilbara region the figure stands at just 28%. NSW Minerals Council chief executive officer Stephen Galilee said KPMG’s report, Analysis of the Changing Resident Demographic Profile of Australia’s Mining Communities, proved that responsible mining had helped the Hunter economy “outperform” other NSW regions. “The KPMG report is further evidence of the positive role mining is playing in the ongoing development of the Hunter Valley,” Galilee said. “One of the most positive impacts of the Hunter mining industry is that more people in the region own their own home than in any other surveyed mining region in Australia.” Nationally, mining in the Hunter Valley has helped create jobs and improved individual income growth. According to the report, 7% of the Hunter Valley population was earning more than $2000 a week - a 3% increase from 2006 – which is higher than the average for regional Australia. The Australian Bureau of Statistics (ABS) has confirmed that household income growth in the Upper Hunter Shire grew 21.7% between 2006 and 2011, while Newcastle incomes grew by 31.4%. Additionally, Cessnock household incomes have grown by 31.9% and Singleton by 33.6%. The report revealed that the Hunter Valley experienced the largest decline in unemployment rates compared to all major Australian mining regions between 2006 and 2012. “This latest analysis shows that mining not only delivers direct jobs to workers in the Hunter, but also supports job growth in other sectors right across the regional economy,” Galilee said. The ABS said mining produced more than 20,500 jobs in the Hunter Valley, and generated an estimated 71,000 indirect jobs. “The majority of our mining workforce live and raise their families in the region and are an integral part of their local communities,” Galilee said. KPMG is one of the world’s four biggest auditors and has 13 offices throughout Australia.


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Mining Equipment & Finance

Leasecorp provides mining companies funding for transport, excavation, drilling, accommodation blocks and information technology equipment.

The whole package A finance expert is urging mining companies to implement a purchase strategy when purchasing mining equipment is critical. By Vetti Kakulas


rocuring heavy equipment for mining projects is a major challenge for companies. Established in 1985, Sydneybased Leasecorp has offices in New South Wales and Victoria. The firm provides vehicle and equipment finance to mining companies throughout Australia. Leasecorp Motor Vehicle and Equipment Finance managing director David Heenan warned that once funding was confirmed,

there was often not enough capital to support the acquisition of heavy transport and excavation machinery. “Securing funding has become difficult, as bankers tighten lending criteria for the mining industry,” Heenan said. “Lenders don’t understand the real value of a new and well-researched project, so in some cases they prefer to reject the opportunity to fund the equipment required. Among the benefits of equipment funding

is that it allows companies to access the latest machinery without outlaying major capital. Cash is then able to be directed towards other obligations, such as research and development, operational expenses or future acquisitions. Heenan added: “As the project grows, financiers may want to have additional security. In most cases Leasecorp will be able to fund the equipment itself with only the machinery as security.”

Safety first A RECENT survey has shown that workforce safety is the No.1 priority for mining companies. And 25% of those surveyed placed management of capital projects next in the order of importance. The survey was released by industrial software supplier Ventyx. Based in Brisbane, Queensland, Ventyx develops software for the energy, mining and public infrastructure industries. The Mining Executive Insight survey showed that 31 per cent of executives listed workplace safety as their No.1 priority. Ventyx said the finidings demonstrate how closely mining executives correlate worker safety and mine productivity. Approximately 64% of respondents identified their primary safety initiatives as development of skills, best work practices and situation-based decision making. “Mining companies have shifted their focus from finding qualified workers anywhere


An information graphic from the survey results.

at any cost to ensuring their workforce is efficient, well-informed and safe,” Ventyx’s senior vice-president of mining industry solutions, Bas Mutsaers, said. Ventyx surveyed 374 mining companies worldwide. The majority of respondents came from coal, gold, copper, iron ore, zinc and

nickel companies. “There is an opportunity for mining organisations to transform how they educate and empower their workers, to reduce safety incidents and improve efficiency,” added Mutsaers.


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Communications Technology & Equipment

Globally connected Welcome to 2013, where explorers and miners can access social media in the most remote regions of Australia. By Vetti Kakulas


eophysicists, geologists and mining engineers spend a lot of time exploring new deposits in areas where communications do

not exist. However, satellite services provider Inmarsat vice-president enterprise energy Gerbrand Schalkwijk believes the outlook has improved over the past few years due to technology breaking down the communication barriers in rural areas. “Mobile satellite communication has improved in the past decade, and has become the perfect communications medium for the mining sector,” Schalkwijk said. Inmarsat specialises in global voice, data and IP communications, and operates a fleet of 11 spacecraft in geostationary orbit, providing telecommunications for fixed satellite and wireless technologies worldwide. The technology firm provides voice, machine-to-machine technologies and “high-speed” broadband to the government, military, energy, mining and industrial industries. “Access to communications facilities has a positive effect on morale, as it allows miners to stay in touch with their loved ones,” Schalkwijk said. Field engineers can send emails and make long distance calls to


Inmarsat’s IsatPhone Pro.

friends and family using handheld satellite phones, such as Inmarsat’s IsatPhone. Miners can access the internet, via iPads, laptops and smartphones if they connect to Inmarsat’s satcom terminals.

“Mobile satellite communication has improved in the past decade, and has become the perfect communications medium for the mining sector.” – Gerbrand Schalkwijk “Staying connected is increasingly important for the next generation of miners, who will be armed with social media tools such as Facebook, Twitter and a whole array of contemporary gadgets,” Schalkwijk said. “This is where a satellite phone such as the IsatPhone Pro can be useful in helping the younger generation of miners remain connected to their friends and families,” Schalkwijk said.

“We are more connected today than ever before as a global society and this is also true for the mining sector. “Technological breakthroughs enable communications with mines in remote areas and in extreme conditions, which has positive implications for safety, mining operations and miners’ morale. With satellite communications, there is no need for miners to be as isolated and out-of-touch, as they were previously.” Mobile satcom terminals are used to send test data samples, images and videos in real-time from remote minesites to the lab for analysis. Inmarsat say their portable terminal, the Broadband Global Area Network service, fits easily inside a backpack with a laptop and takes less than five minutes to access an online connection. “With the reliable satellite connectivity that makes all this possible, the rate of exploration is faster and miners and geophysicists are able to complete their tasks quicker and more efficiently,” Schalkwijk added. “Mining professionals will greatly save time and money if they can report the latest mining deposit information with the team onsite.” Based in the UK, Inmarsat has operations throughout Australia.

MARCH 2013 amm

pascoe mIchAeL

Baiting the bears and bulls Sitting comfortably? OK, then we’ll begin. Let me tell you the story about the China bears and the Japan bulls.


trange things, markets. For a fair whack of last year, Adam Smith’s “invisible hand” bought the yarn that China was dramatically slowing, that the China story was not having a happy ending, that it was all hands to the iron ore carriers’ pumps, the commodities boom was bust and Australia was doomed. Talk to the hand indeed, because the brains weren’t thinking. As I’ve whinged before, the level of stupidity was exemplified by all the pet shop parrots not even understanding what the much-reported Chinese purchasing managers indices meant while they were screeching about them. Because of the high base effect, a PMI reading a little below 50 did not mean Chinese industrial production was contracting, just that the rate of growth of production was a little lower than it previously had been, that Chinese production was merely growing very fast instead of extremely fast. Given the greater size of the animal, the growth in the amount of stuff actually made fairly constant. The real story is demonstrated by visiting the Reserve Bank’s website and checking the China output indicators graph in RBA’s chart pack – you won’t find a diving economy. You might think the more outspoken China bears would be feeling a little sheepish with Chinese growth on track, but they are a hardy and unyielding breed most likely to keep forecasting doom until, one of these decades, they might well be right, allowing them to finally say “I told you so”. Watching the iron ore price gyrate over the past year, I was reminded of the wisdom once imparted by an old oil man: prices won’t stay as high as you hope or as low as you fear.

BAITING JAPAN BULLS Heading in the other direction, some of the markets’ January enthusiasm came from buying the idea that yet another recycled Japanese politician was going to make a difference with yet another attempt at reflating the economy by printing yen and building more infrastructure. Something about the definition of insanity comes to mind. Sure, in the short term Prime Minister Shinzo Abe can give a moribund economy a


No bull: Australia’s second largest trading partner, Japan, is facing a financial crisis.

kick along by borrowing even more money from an acquiescent people to spend on building stuff of dubious merit and by leaning on the Bank of Japan to run the printing presses full pelt, but the odds are that the short term will be short indeed. The Japanese government makes the US and Europe look positively thrifty with a debtto-GDP ratio that is beyond understanding. The government simply borrows more each year than it raises in taxes with no sign of meaningful change on the horizon. There are a number of problems with Abe’s stimulus plan. One of the more obvious is the inherent Catch-22 for government debt. While interest rates are zero in a deflationary environment, it’s not too hard for the

government to borrow, but if all the money printing and fiscal stimulus does succeed in creating the declared target of 2% inflation, the punters lending the money will need to be paid for it – which the government won’t be able to afford even before considering the cost of the country’s horrendous demographics. Japan doesn’t so much have an ageing population as a dying one. The nation is shrinking – there will be 25% few Japanese in Japan by 2050. A quarter of the population is already aged 65-plus. And Japan’s xenophobia means the immigration solution can’t be considered. Most politicians don’t like talking about the third arm of government policy –

MARCH 2013 amm

population – but unless fiscal, monetary and population policies are complementary it’s extremely hard to escape the doldrums and stay out of them, or worse. it’s a medium term worry that our second-largest trading partner has made a reservation to be the home of the next major financial crisis. Oh well, just taking its turn after the US and europe have had a go, i suppose.

CHINA AND JAPAN (BAITING EACH OTHER) Before that though, there’s the worry that our two biggest trading partners are baiting each other over a few insignificant rocks in the east China Sea. Please don’t fall for anyone trotting out a cliché about there being potential oil and gas riches at stake in the dispute – it’s all about nationalism and the way a bit of sabre-rattling plays domestically. Given the Orient’s long-view of history, both sides have arguments for ownership of the Diaoya/Senkaku islands, so both sides need a good cup of tea, a lie down and a return to letting sleeping rocks be. Optimists will say Japan PM Abe is more pragmatic than his rightwing rhetoric suggests and that China’s leadership is nothing if not pragmatic despite its left-wing rhetoric, but nationalism is an extremely dangerous beast to stir, especially when America is stirring the Asian pot with its “pivot” – the euphemism for China containment.

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More jobs and houses: will India cope with the influx of 500 million people?

Over to india ... While this column is taking a tour of the regional powers, the latest forecasts for india’s economic growth are nothing to get excited about and nothing has changed to stop it becoming our biggest worry in the longer term. The international Monetary Fund cut its forecast of 2012 indian economic growth to 4.5% from 4.9% and fractionally trimmed its 2013 forecast to 5.9%, but predicted (or expressed the hope that) 2014 would see growth. The Goldilocks view of Australia’s commodities boom was that, as China’s steel intensity levelled off, india was coming along on the same path to pick up the slack and thus Australian miners could live happily ever after. Trouble is, i don’t know that india is capable of the sort of industrial revolution that has characterised the early stages of other nations’ economic miracles. Oh, there will be a relatively well-off middle class of 300-400 million people, more than the populations of the United States or europe, but the fate of the other 1.3-1.4 billion is a concern. Just as Japan is failing to come to terms with one sort of demographic crisis, india is failing to address another: it has another 500,000,000 people arriving by 2050 but refuses to face the reforms necessary for them to be gainfully employed. That can cause more tension than a few rocky islands.

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04.02.13 10:59

Minesite Visit: Omahola, Namibia

Painting Namibia Deep Yellow Uranium hopeful Deep Yellow has reached the point where it’s focusing less on drilling and more on development. Kristie Batten visited the company’s projects in Namibia, Africa.

Drilling at Ongolo.




erth-based Deep Yellow is the largest landholder in Namibia, with 4200sq. km of ground. Deep Yellow’s flagship project is Omahola, in the Namib Desert, and about 45 minutes from the coastal tourist town of Swakopmund, which also serves as the company’s Namibian base. Omahola is in “Alaskite Alley”, which also hosts Rio Tinto’s Rossing mine and Swakop Uranium’s Husab development. Omahola comprises the Ongolo and MS7 alaskite deposits and the Inca uraniferous magnetite deposit. It has a resource of 48.7 million tonnes, at 420 parts per million uranium oxide for 45.1 million pounds of uranium oxide, thanks to a 39% increase in contained resources at Ongolo last week. Ongolo, discovered by the company in 2010, is an extension of Swakop’s Garnet Valley deposit and sits adjacent to it. For the first time, the resource included a resource for Ongolo South, with the maiden figure coming in at 2.5Mlb. The upgrade took Deep Yellow a step closer to its short-term resource target of 50Mlb.

“Strategically, there’s a vast difference to where we were two years ago.” – Greg Cochran “That’s the trigger point for the PFS,” Deep Yellow managing director Greg Cochran said. “We just feel that it’s at a credible size to be about to justify taking it to PFS.” Drilling, which has been aggressive, will slow down as the company focuses on the metallurgical aspects of the project. “It’s a natural hiatus as we look at our geophysics,” Cochran said. The current program at Ongolo is about 5000m with more work to be done at Ongolo South, including further target generation. The deposits also remain open at depth, with little to no drilling completed beyond 250m below surface. Deep Yellow has completed a staggering 700,000m in its life – 200,000m at Ongolo and the MS7 deposits alone – and has rapidly drilled out its discoveries, which also comprise Inca in 2008 and MS7 in 2011. The company has rapidly grown resources from only 19Mlb two years ago when Cochran joined. “So we’ve tripled it in two years,” Cochran said. “Strategically, there’s a vast difference to where we were two years ago.” With as many as seven drill rigs on site last year, that has been cut back to four, with resource drilling to continue with the aim of reaching the allimportant 50Mlb mark by mid-year.



Minesite Visit: Omahola, Namibia

Deep Yellow managing director Greg Cochran at Omahola.

If all goes to plan, the Omahola PFS on a roughly 3Mlb per annum operation will be completed next year, with a DFS to follow in 2015 ahead of first production in 2016. “It’s still a hard ask,” Cochran admitted. “We’ve still got a long way to go to get there.” Cochran said the grade was a huge plus for Omahola at a time of low uranium prices. The average grade for Husab is 480ppm, Rossing’s is 282ppm, nearby Paladin Energy’s Langer Heinrich mine has a healthy average grade of 550ppm, while Bannerman Resources’ Etango project, adjacent to Omahola, looks less economic with a grade of just 201ppm. “Nobody out there has 420ppm and nobody out there has the blue sky potential that we have,” Cochran said.

High-grade core from Omahola.


“It’s a grade game, not a science game. Bannerman’s only upside is price.” Although the focus is firmly on progressing Omahola, Deep Yellow’s leases also contain the Tubas Sand uranium project and the Shiyela iron ore project. Tubas Sand comprises primarily low-grade secondary uranium mineralisation with a resource of 28.4Mlb uranium at 148ppm. There is potential for early cashflow at Tubas Sand. “We’re pursuing sand due to optionality,” Cochran said. There is plenty of work to be done on the resource side and a drill rig is on site, but the company envisages a straightforward truck and shovel operation. Cochran said the final loaded resin product could be sold to either Rossing or Husab at

75-80% of the spot price. Meanwhile, at Shiyela, which was discovered in 2008, the company received a mining licence last week. Cochran said it was a relatively easy process as the Namibian government was seeking to diversify its mining industry. To retain its uranium focus, Deep Yellow is seeking a partner to develop Shiyela after a positive scoping study. The study returned capital costs of $US367 million ($A355.6 million) for a 2Mt per annum operation producing a 68% iron magnetite concentrate at cash costs of $63.20 per tonne free on board Walvis Bay. Cochran said the company would be looking to work closely with the partner, with the potential to share infrastructure. “We want to retain a stake,” he said. “It’s the logical thing to do given it’s in the middle of our tenement.” To meet an aggressive timetable at Shiyela, Deep Yellow is looking to finalise a partner within six months. The company recently signed a joint venture agreement with the Namibian government company Epangelo over the Aussinanis deposit south of Omahola and is also in talks with Rio Tinto over three 65%-owned tenements. Rio is earning an interest in the Dome project, which is near the ground. “We’re almost there,” Cochran said. “We would like to do it all ourselves, but it’s just impractical.” Deep Yellow is also still in talks to divest its Australian projects in Queensland and the Northern Territory, and Cochran said it would walk if it had to. “We cannot afford to waste resources in Australia,” he said. “It’s all about Namibia.” • Kristie Batten is Editor of

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Mining Brief

Explosive warning Mine inspectors in Queensland are investigating a series of incidents and accidents involving explosives. By Alison Middleton


ueensland’s explosives inspectorate is calling for increased safety measures following a spate of incidents involving explosives. Safety alerts have been circulated to mining companies urging managers to review safety management systems, controls and operating procedures. The Department of Natural Resources and Mines’ explosives inspectorate was alerted to each event and issued recommendations to mining companies. One of the incidents involved a drill rig which bored into misfired explosives. An official safety alert issued by the department said an underground production drill rig accidentally bored into explosives which had been left over from a misfire.

Miners in Queensland are urged to review systems and procedures for explosives.

It emerged that the location of the misfired explosives had not been identified by previous post-blast inspectors and were hidden by shotcrete. In another incident, an electric detonator was accidentally initiated during transportation in a cardboard box to the shot location. It was one of six loose detonators and is likely to have been initiated by impact, heat or friction. And in a separate incident, a non-electric detonator was found inside a canvas carry bag on an underground charge vehicle and was recovered during maintenance in the workshop. Fulty padlocks compromised explosives security in another occurrence. Miners were also warned of the dangers

of combustible materials after rags left on an explosive vehicle’s exhaust caused a small fire. And a recent alert focussed on an explosion in an industrial vacuum truck. The truck was working in a mineral processing plant when the vacuum motor caught fire and ignited gases in the interceptor tank which had built up to explosive levels. Material was ejected up to 30m away. Queensland Inspector of Mines Damian Lee said: “All mines should check types of equipment and assess whether additional controls, including an appropriate fire suppression system, are needed.” Chief inspector of explosives Geoff Down urged companies to review security plans and safety management systems.



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Australia-proof One of Australia’s largest gold mining operations was the testing ground for the latest mechanical bucket. By Alison Middleton


system of replacing bucket edges without welding has reduced costs and downtime at an underground gold mine. Steel castings manufacturer Keech Australia has been trialling its mechanical buckets on six underground loaders at Newcrest Mining’s Cadia East gold mine in Orange, New South Wales. Keech said the buckets had reduced the amount of downtime and costs when bucket edges needed to be replaced, as well as increasing the time between replacements. The KMB system was introduced to tackle issues associated with bucket wear, particularly on corners, which is a common issue on mine sites Australia-wide. Welded-style bucket edges can take up

Welded-style bucket edges can take up to 24 hours to replace and can be costly in labour and consumables. to 24 hours to replace and can be costly in labour and consumables, plus the associated costs of machinery downtime. Keech said the KMB had been designed to reduce edge replacement downtime and eliminate underground welding requirements altogether. The bucket features an Armourblade edge, which is fixed to a mechanical attachment that can be replaced within three hours. Because no welding is required with the bolt-on system, the edge can be replaced while the loader is underground, reducing the time

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and inconvenience of bringing the loader to the surface to replace a weld-on edge. Since the trial began in 2011, three edges have been kept for each bucket – one in use, one being maintained and one kept as a spare part in the workshop for when it’s needed. Early results of the trial led Keech to investigate ways to significantly strengthen the bucket edge to suit the demands of hard rock mining. The modification included strengthening the edge cast by using Keech Gold as a more abrasion resistant metal.

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“On average, bucket edges needed replacing every 700 hours,” said Keech Mining Supplies business manager Brad Clark. “However, Cadia East’s loaders are serviced at 250 hours,” he continued. “We looked at ways we could improve the high-wearing bucket edge and targeted 1000 hours prior to replacement, which would fit in with the scheduled service frequency

“At just over 700 hours into the trial, it is proving a success, with only minimal wear on the bucket edge.” – Brad Clark

Keech Australia’s bolt-on system for replacing bucket edges.

“By doing this, the edge can be replaced during scheduled machine maintenance, which is a significant time and cost saving. “Within three weeks our research and development team in Bendigo had a solution. They modified the design and used Keech Gold on the corner castings to prolong bucket life.” While Keech Gold cast steel is already abrasion resistant, the team increased the amount of metal in the edge system.

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Following the modifications, the metal is tougher and the corners now contain 10% more metal than the previous edge design. Weekly visual checks have been conducted to measure wear on the bucket corners throughout the trial. The checks are done by a trained welder from Cadia East with extensive experience in visual wear inspection. Wear is recorded in and logged against the hours of operation to track performance. “At just over 700 hours into the trial, it is proving a success, with only minimal wear on the bucket edge,” Brad said. Local representatives from Keech have been actively involved with the trial since its conception, with site visits every three to six months. Cadia East’s maintenance staff have also visited the Keech foundry at the company’s headquarters in Bendigo, Victoria, to inspect manufacturing operations and see how product developments are refined. Keech said that the mining company chosen for the filed test was so impressed with the early trial results that it would be extending the trial using an Armourblade edge fitted with Keech Gold edges at its nearby underground mine, Ridgeway. “We anticipate that, over the course of the next 12 to 18 months, the opportunity

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will arise where more KMB buckets fitted with Armourblade edges will be rolled out, continuing the push towards lower

cost and higher productivity operations,” Clark added.

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Sole provider Wear resistance specialist reaches distribution agreement with Australian manufacturer.


wear consumables provider with its eye on new markets has begun 2013 with an international distribution agreement. Crushing and Mining Equipment has confirmed its appointment as the sole distributor for ceramic liner materials from Australian Ceramics Engineering. The agreement will build on the range of wear products CME provides to the mining industry. Weld overlay, quenched and tempered wear plates, blocks and steel, rubber and polyurethane grinding mill liners are among the products supplied. Under the agreement, CME will supply ceramic liners directly into Australia, New Zealand, Indonesia, Africa and the Middle East. Parent company H-E Parts International will also market and distribute the products into North and South America. CME said ceramic liners offered an alternative solution to weld overlay, quenched and tempered wear plates, as well as other lining materials used in highly abrasive applications. Ceramic solutions are becoming more common in iron ore and other hard rock applications because they have been proven to provide increased productivity, enhanced wear characteristics, improved flow efficiency, noise reduction and a lower total cost of ownership. CME sales and marketing general manager Gordon Fogwill said CME was able to offer a full suite of wear materials. “With in-house engineering, manufacturing and offsite-onsite service support, CME is capable of recommending and supplying solutions that will extend mean time to repair, improve reliability and reduce cost,” he said. “The addition of ceramic liners to our wear product portfolio further strengthens CME’s position in the mining, quarry and materials handling industries. “It enables us to offer the complete sales and service package.” The range of ceramics includes ACEdurable, ACEdurable+ and ACEimpact varieties to suit site-specific applications. Engineering and installation services are also provided to mining customers by CME’s service division. CME is a subsidiary of H-E Parts International. Based in Perth, the company also has offices in Brisbane, Sydney and Melbourne. It manufactures its own jaw and vertical shaft impact crushers, grizzlies and apron feeders.

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Meet the Nemisys Australian miners await the the arrival of ESCO’s first integrated mining lip, shroud and three-piece tooth system.


ining companies which headed to Minexpo in Las Vegas last year would have heard a lot of familiar phrases coming from the ESCO stand. The US-based wear product manufacturer says its Nemisys system maximises productivity, enhances safety and gives longer wear life. And importantly, the company has confirmed the much-anticipated Nemisys will finally arrive in Australia in the third quarter of this year. ESCO’s first mining lip, shroud and threepiece tooth single integrated system offers four sizes to fit large excavators, draglines and cable shovels. The new approach was designed by a team of 12 engineers to create a better fit between the system’s components.

Initial product testing showed Nemisys required less force to penetrate the ground, while the tooth system provides more usable wear metal and the lip weighs less. Hammerless locking devices on the teeth and shrouds were also designed to increase wear life and reliability while enhancing operational safety. The system is suitable for all classes of excavators, ranging from 250 tonnes to the ultra-class 800t units. A spokesman for the company said Nemisys was scheduled to arrive in Australia in the third quarter of 2013. “Our Australian team anticipates significant demand and a successful introduction this year,” he said. “ESCO is working to have the highest demand Nemisys lip assemblies available to customers in Australia.”

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Remember CRA and Western Mining? Exploration doesn’t define the mining industry the way it did 30 years ago.


ews that the majors are slicing and dicing their exploration budgets will have come as a surprise to no one. The fall in some commodity prices, plus several ill-advised big-ticket acquisitions, make that inevitable. But you have to take into account that, while important, exploration spending by the big boys is not what it used to be. Sure, the figures are substantial, but they’re not critical, not in the way they were 20 or 30 years ago when they were the main exploration game in town and when the industry hung on every exploration tidbit from the likes of Western Mining or the old BHP in its “Big Australian“ days. Back in the 1970s and 1980s there wasn’t the profusion of juniors we now have (whether you think that was a good or bad thing), nor were the streets of West Perth teaming with promoters handing out their latest prospectuses. But, of course, the greatest of all in terms of opening up Australia was the old CRA Exploration. As I may have mentioned previously, one junior company executive once remarked that if you want to find something to float, then trawl through CRA’s records looking for something they found, did nothing with and which has possibly been forgotten with the passage of time. Just by way of background for the more recent recruits to the mining sector, CRA Exploration was part of CRA, formed in 1962

as Conzinc Riotinto, a merger of Consolidated Zinc and Rio Tinto A quick Google search turns up many examples of the legacy left by CRA Exploration. Toronto-listed Strata Minerals has the Cardabia phosphate project near

Exmouth. It was drilled between 1989 and 1991 by CRA. Australian Minerals and Mining Group now owns the Green Range coal project near Albany. In the 1980s, a CRA drill team intersected coal there and then further work

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led to the announcement of an exploration target of 500 million tonnes of lignite. Then there’s Australia Zircon, which has had a bumpy ride of late. But it has the WIM150 heavy minerals deposit near Horsham, Victoria. Discovered in 1982 by CRA, a subsidiary of which got as far as setting up a pilot plant, although that was scaled back in 1992 because of poor economics. The cycle has turned since then, though. And the CRA team discovered the huge Kintyre uranium deposit (now owned by Cameco), the Cummins Range uranium and rare earths deposit (which has been shelved again as rare earth prices tanked) and many others. Everyone will have their own CRA example. They operated overseas, too. The huge Sepon copper-gold deposit in Laos was one of the notches in CRA’s corporate belt. MOD Resources now holds the 1 million ounce Sam’s Creek gold deposit in New Zealand, discovered in 1974 and defined by 46 CRA diamond drill holes. Toronto junior Barisan Gold has a large porphyry project in Indonesia’s Aceh province first defined by the Australian-based major. It was another era. Disclosure: The writer holds Rio Tinto shares.

Then and now FROM the good old days to the bad old days. I refer to that grim period in the late 1990s and spilling over into the new century (which began on January 1, 2001, I hasten to remind all of those who celebrated a year too soon). There’s also something here apropos the dominance back then of CRA, Western Mining and BHP. A 2002 report from ABARE is worth thumbing through just to show you how much has changed – or not. It quoted Geoscience Australia data showing that, since 1960, junior explorers accounted for 60% of discoveries. Which meant that 40% were found by the majors. How many have the majors made since 2002? Not many. Interestingly, the survey was based on 105 juniors with a market cap under $200 million. Seems the junior sector has blown out considerably in the 10 years since! Ah, but the financial results of said juniors won’t come as a surprise; 89% of them recorded losses in the year before the report’s publication, 83% had spent less than $2 million on exploring, and the aggregate loss for the group was $196 million against exploration totals of $100 million. (That’s the bit about things not changing much.) The crunch was that between 1997 and 2001, exploration spending in Australia fell 49%. And we’re still playing catch-up.

Happy ending BUT a positive note to end. Mining has its disappointments and dramas, but there’s one area of stress that’s largely absent among the juniors: competition (apart from fighting over tenements). Unlike the retail business, you don’t have the supermarket giants undercutting you and forcing you to close down; unlike in manufacturing, Asian sweatshops can’t take away your markets; unlike newspapers, book publishers and magazines, gold and zircon cannot be delivered by wireless technology. Remember that when the next disappointing assay comes through.

amm MARCH 2013


Geomechanics & Ground Control

Beneath the surface Australian companies looking abroad for mining projects are being urged to seek specialist input for shaft systems. By Alison Middleton


t’s vitally important that mining companies consider the geomechanics of an underground mine prior to development. This is particularly important for the miners working onsite, who will be entering and exiting an underground mine via its tunnels to reach the ore. It is why mining consultant SRK is reminding resources companies of the need to seek expert advice for the design, development and operation of mining shaft systems. South Africa-based principal mining engineer William Joughin said shaft systems were critically important in mining that required specialised technical input. The SRK expert said experience had shown

“Control of ground conditions is a key factor in the design and sinking of shafts.” – William Joughin that the consequences of damage to shaft systems caused by geotechnical factors were both serious and costly. “Control of ground conditions is a key factor in the design and sinking of shafts,” Joughin said. “These conditions may vary considerably throughout the length of a shaft, and require specific technologies to ensure safety and functionality. “Close to the surface, weathered rock and residual soils are common. These materials generally are too weak to carry the high

foundation loads exerted by large headgear structures, winder houses and other surface infrastructure.” Groundwater often affects upper areas of the shaft and must be controlled by grouting to prevent water from entering the shaft, or by drainage systems built into the lining structure. Natural breaks in the rock, such as joints and faults, affect the behaviour of the rock mass at shallow and intermediate depths down to 1000m below surface. Dolerite sills encountered near the surface

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Engineering a Better Solution MARCH 2013 amm

A mine shaft cage housing infrastructure support.

tend to break up into small blocks. And at about 1000m below the surface, stresses that exist naturally in the ground can become large enough to start inducing additional fractures in the rock mass. Joughin said simple support systems such as rock bolts or split sets, wire mesh and shotcrete were adequate to protect the workforce involved in sinking the shaft under these conditions. “A monolithic concrete lining, usually 300500mm thick, gives permanent support and carries the fastening systems for buntons, pipework and electrical cable bundles,” he said. “It also seals the rock, and prevents weathering and deterioration over the planned operating life. “Certain weak geotechnical zones exhibit time-dependant behaviour and can deform excessively – squeezing when the shaft experiences stress changes during its life. “This squeezing can cause severe failure of the lining. SRK has designed and implemented a support system which can accommodate large deformations in the shaft barrel and maintain serviceability of the shaft.” SRK has developed a systematic design process that incorporates the data and experience gained from rehabilitating existing shafts. The design process comprises gathering data from borehole cores and mapping of

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Mine shaft excavation underway in South Africa.

exposed rock, which is analysed to assess the rock mass response to excavations. Possible modes of failure are assessed, and excavation and support designs are analysed through to monitoring the implementation of the design. SRK offers specialist services to mining and exploration companies for the entire life cycle of a project, from exploration through to mine closure. With their Australian head office in Perth, Western Australia, SRK has 45 offices throughout the world. SRK Australia chairman and principal mining consultant Simon Hanrahan, who is based in Perth, said the shaft development process depended on the different ground conditions around the world. “There are companies that will be looking at going deeper over time,” he added.

“It’s all driven by metal prices in terms of what you can economically mine. If the cost was right, then that would push shafts to be deeper. A shaft is a very subjective thing – it really principally depends of rock types. “The advice for Australian companies would be that they need appropriate geotechnical investigations to determine what the near-surface rock type conditions are. “Miners would typically drill geotechnical bore holes and log the core, and make a geotechnical assessment on that basis. “You need to make sure you complete appropriate levels of study over what is normally expected for a feasibility study. If you do that then you effectively manage the risks.” alison.middleton@aspermont,com


Geomechanics & Ground Control

Identifying the stress A seismic and geotechnical product manufacturer has released a three-dimensional sensor for monitoring rock stress.


o remove the fatal risk of underground mines collapsing, it’s critically important that miners monitor the stress levels of the ore’s surrounding rock. Australian manufacturer Environmental Systems & Services (ES&S) has focussed on the criticality of monitoring rocks and subsequently upgraded its HI Cell stress measurement sensor. With headquarters in Melbourne, Victoria, ES&S specialises in meteorological, oceanographic, seismic, environmental and geotechnical products and services. Dubbed the HID Cell, the new sensor has been digitised and is used for in situ monitoring of rock stress. “The HID Cell can identify in situ stresses



to enable mining engineers to design a ground support system for the mine,” ES&S sales manager Chris Coseski said. “Before installing rock bolts or split sets, to prevent the shaft from closing, you need to know what the in situ stress is.” The HID Cell sensor produces a threedimensional or triaxial result, and is used for monitoring rock strains in underground mines. First developed 30 years ago by the Commonwealth Scientific and Industrial Research Organisation, the HI Cell continues to improve, according to Coseski. “We’ve put in some smart electronics which makes it easier to monitor using tablets, loggers and computers,” he said. “Anyone can buy it and hook it up with

their monitoring devices, whether it’s loggers or computers. Miners don’t have to be sensor experts before they use it.” To install the HID Cell, miners must drill a hole in the rock, place the sensor and then glue it inside, it can then be left temporarily or permanently in place to measure stress over time. “If a rock is under stress, you can drill it and by doing so you release it from the remaining rock,” Coseski said. “The rock will then want to spread out – so we measure that using the sensor. “We are able to back-calculate, measure the strain and calculate what the initial stress was.” HID Cell is compatible with any data logger that accepts RS232 communications.

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Seventh symposium

The HID Cell sensor is drilled into place.

Coseski said the HID Cell had higher accuracy, easy data download and analysis tools, and eliminated problems associated with readout drift. The HID Cell is said to be narrow and cheap to use and requires just four conductor cables. Compared to its predecessor, the digital sensor requires lower power and contains strain gauges, with an embedded microcontroller, which monitors the strain and

reports the values via a serial link. “Strain values are digitised directly at the gauges, which removes the common problems of noise and signal degradation due to long cables,” Coseski said. “Power is only applied to the gauges when a value is read, removing any issues associated with long-term heating.” ES&S has operations in Brisbane, Queensland, Perth, Western Australia, and Beijing in China.

THE AUSTRALIAN Centre for Geomechanics (ACG) is hosting the Seventh International Symposium on Ground Support in Mining and Underground Construction. Running from May 13-15, the event will be held in Perth, Western Australia. Local and international mining and civil engineers will exchange experiences and lessons in rock support and reinforcement. The ACG is a mining research centre based at the University of Western Australia, Perth. “We expect the technical program to include more than 70 papers focusing on the latest ground support developments, improvements, innovations and operations around the globe,” ACG director Yves Potvin said. “Ground support in underground mining and civil construction is a rich topic that has fascinated practitioners and scientists for many years. It has seen numerous innovations and adaptations.” The symposium will be chaired by consulting engineer Barry Brady, who has over 40 years’ experience.

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Geomechanics & Ground Control

New Phoenix in town A ground support product specialist has branched out with another facility in Queensland.


estern Australian company Split Set Mining Systems has opened a manufacturing and distribution facility in Townsville, Queensland. The manufacturer is a division of Phoenix Metalform and the facility was developed to meet the increasing demand for ground support products. Its mining products include the popular Split Set stabilisers, resin bolts, bearing plates and cable bolts. According to Split Set east coast ground support manager Trevor Land, millions of Split Set stabilisers have been sold since 1977. “As mines are forced to address the ever changing underground geotechnical environments, Split Set can create and design specialty bolts that may be needed,” Land said.

The Townsville facility offers a range of poly pipes and Minsup fittings, hoses, vent bags and a range of other items required for underground works. “These additional capabilities appeal to a wider range of customers throughout Australia and overseas, as more mining companies support a one-stop shop for ground support needs,” Land said. Another feature of the facility is the Burndy Electrical building. Burndy Electrical is a wholesale supplier of electrical cable support products including cable tray, ladders, ducts, lugs, connectors and grounding equipment. It has other warehouses in Brisbane, Sydney, Melbourne and Perth. “Both Split Set and Burndy Electrical have

formed excellent relationships with a number of freight companies that help move material from manufacturer to customer, quickly and efficiently,” Land said. “The ability to supply on demand on a daily basis is paramount in ensuring client satisfaction continues for both Burndy and Split Set.” Split Set offers customer support for all its products, as well as operator training for miners. “Our Townsville staff are customer-focused and aim to achieve the best possible outcome to keep businesses on schedule in today’s high demand mining and electrical supply market.” Split Set has other operations in Brisbane, western Sydney and Melbourne.

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Focus: Windarra

Australian heritage Emus, tourist trails and fruit trees – just some of the features of a major mine rehabilitation. John McIlwraith takes a look at the project.


n icon in Australian mining history, the Windarra nickel and gold mine is undergoing a rare reversal. Held as an example of mine rehabilitation and environmental virtues, it is in the process of becoming an operating mine again. However, Poseidon Ltd, namesake of the original founder of Windarra, in Western Australia, will retain much of the heritage trail and other facilities, although changes will have to be made. The trail, and other attractions demonstrating at least partially how a nickel project operated, was established by the previous owners, one of the most ambitious projects of this type in the 1990s. Western Mining Corporation (WMC),

then the operators of Windarra, invested $9 million on the rehabilitation project – equivalent to $14 million today.

Emus were soon grazing among the abandoned machinery as if man had never appeared on the landscape. It won international awards for the imagination and care invested in the venture and has attracted thousands of tourists to a site which is hardly on a major tourism track.

The modern Poseidon Ltd has already closed off parts of the tourism area but is working on a new route for the heritage trail, retaining many of the features of the previous layout. David Singleton, managing director of Poseidon, said the company was determined to retain the heritage scheme for the benefit of tourists and the community of Laverton. The heritage trail, which currently runs through the site of a planned treatment plant, will be re-routed. But the trail up to the top of Mt Windarra will be retained so that visitors will be able to see the workings of an operating mine and the remains of a previous one. The lookout will have a similar function to one at the Super Pit, in Kalgoorlie, which

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gives tourists spectacular views of the vast manmade hole. The new heritage trail will give visitors a unique view of a mine of the past and a current operation. Some of the biggest structures in the first Windarra have been retained, and care had been taken to have ample signs and explanations around the site. Poseidon Mark II will be commissioned around the middle of next year at a cost unofficially estimated at $200 million. WMC recruited local people to help in its regeneration program 16 years ago – schoolchildren planted 100 trees around the heritage trail car park and Laverton people helped collect more than 2 tonnes of indigenous seed which was sown to blend in with existing vegetation. The restoration was described at the time as one of the most costly and complex attempted in Australia. One challenge was finding 2200 exploration drill sites and the tracks running to them. They were among the areas reseeded with local plants. The opencut mine was reshaped to make it as near the original contours as possible. Given the harsh climate of the Eastern Goldfields – central Australian deserts begin only a few kilometres to the north and east – the project got off to a spectacular start.

Unusually heavy rain in the following 18 months gave the new plants a strong germination and wildlife returned. Wildflowers, for which the region is famous, bloomed. Emus were soon grazing among the abandoned machinery as if man had never appeared on the landscape. Retired engineer John Willis has a long relationship with the mine – he was in charge of building the project nearly 40 years ago – and came out of retirement to supervise the heritage project for WMC. He points out that the operation required the removal of mine buildings, treatment plants, a power station, swimming pool, tennis court, oval, caravan park and a village for several hundred people. He still takes an interest in the venture, pointing out that even the most arid landscapes can be restored after mining. Other miners are also enthusiastic about environmental projects in the area. The nearby Granny Smith gold mine, operated by Barrick Gold, is carrying out research into whether fruit could be grown at two locations where olive trees were successfully established some years ago. The objective is to get the local community involved and develop olive products.

Emu: Now enjoying mine rehabilitation.

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WA Minerals & Pilbara In Focus

Bright in the west Despite escalating costs and broader market uncertainty, the future for WA’s resources sector remains positive. By Alison Middleton


he Western Australian resources sector clearly isn’t short of challenges. But while concerns over lack of skilled labour, red tape, rising costs and fluctuating commodity prices are ricocheting through the industry, the Chamber of Minerals and Energy (CME) of Western Australia insists the future is positive. In an interview with Australia’s Mining Monthly, CME chief executive Reg HowardSmith said there was still a strong outlook for the state’s resources sector. Howard-Smith said 2012 saw a number of construction projects come to an end and transition into production. “Over the next 12-18 months this trend to the production phase will continue as major resources projects near completion,” he said. “Then we will see a significant tapering off in construction and an increase in production. “As we move into the operational phase, production will ramp up and the full economic effects will be felt by governments and the wider community.” The annual State Growth Outlook report produced by CME said growth remained strong, but highlighted a need for strategic long-term planning and policies which encourage investment. And while there is almost $200 billion of

new or expanding projects either underway or planned, the report said there was a need to improve policy settings to attract new projects to the state. It also noted that establishing appropriate settings for infrastructure investment would support future growth in the resources sector. “Skilling remains an issue,” said HowardSmith. “The skill mix will change – there will be a focus on engineers and professional tradespeople, rather than the construction trades. “At the same time, we sit in a period of escalating costs for the sector and broader market uncertainty.” He said the increasing cost of doing business was a significant issue which could be attributed to factors such as a tight labour market, an increase in red and green tape, push for cost recovery of government services and policy positions that seek to spread the benefits of the resources sector. Howard-Smith also noted there had been fluctuating commodity prices and increasing difficulty in gaining access to capital, which had prompted companies to introduce efficiencies and look closely at costs. “While there may be some troubling signs,


the State Growth Outlook study still paints a positive outlook for the Western Australian resources sector,” he said. “Western Australia definitely has a longterm future in the production of mining, oil and gas. The overall outlook for the sector remains positive, with almost $200 billion of new or expanding contracts either underway or currently under consideration, offering opportunities that will deliver broader economic benefits to the state and nation for years to come. “As the sector moves into a new phase, it becomes even more imperative that government, industry and the community work together to find and construct the projects that will ensure Western Australia’s economic development into the future. “Only then will we continue to experience the prosperity derived from a strong sector.” Howard-Smith said that WA mined in excess of 50 commodities and said CME was keen to see the sector expand. He added: “This sector is not looking for handouts, but it is looking for a competitive environment to work.” The minerals and energy workforce in WA is expected to peak at 125,000 people in 2014.

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junior explorer is gearing up for aggressive exploration this year with the discovery of a globally significant mineral sands province in the wilderness of the Kimberley. Sheffield Resources is awaiting metallurgical test results this month. With scoping studies about to get underway, the Thunderbird deposit within the Dampier project is scheduled to have feasibility studies underway by the end of the year. A maiden mineral resource of 1.37 billion tonnes at 6.1% heavy mineral sands has already been announced to investors, and Sheffield has plans to target extensions to the deposit. The resource is the first major mineral sands project to be uncovered in the Canning Basin. Robust targets are also anticipated for the company’s Red Bull nickel-copper project in the Fraser Range, which is within 20km of Sirius Resources’ significant nickel-copper discovery at the Nova deposit. In addition, further exploration success has been confirmed from Sheffield’s recently expanded Pilbara Iron project. Having secured over of prospective tenure within the Canning Basin, Sheffield confirmed it planned to aggressively explore for further large scale deposits. Sheffield Resources managing director Bruce McQuitty said while the iron projects carried significant value, the company’s current priorities were the Dampier mineral sands and the Red Bull nickel projects.

We are grateful to all stakeholders, including the traditional owners, for facilitating heritage and environmental surveys to achieve this outcome. “The Dampier project, which contains Thunderbird, is definitely our flagship project,” he said. “The Thunderbird resource has exceeded expectations. It’s really very large and very high-grade. “Thunderbird is a large tonnage, high-grade resource that is close to the surface – these three qualities position Thunderbird as a globally significant mineral sands deposit. “It is a great achievement by our exploration team and an outstanding result for our shareholders. We are grateful to all stakeholders, including the traditional owners, for facilitating heritage and environmental surveys to achieve this outcome.” “The next key milestone is the results of metallurgical test work, currently being performed on a six-tonne bulk sample from Thunderbird. Results from this work will pave the way for scoping studies to commence.”

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Panning heavy minerals at Thunderbird.

Thunderbird is one of two heavy mineral sands occurrences within Sheffield’s Dampier Project, located on a pastoral lease on the Dampier Peninsula about 60km west of the port at Derby, and 25km north of the sealed Great Northern Highway joining Derby and Broome. The company has confirmed the mineralisation at Thunderbird remained open in all directions, and this year’s drilling campaign would target extensions to the deposit and provide an initial test of the nearby Argo deposit. “The next stage is to demonstrate those minerals can be readily recovered and that they are of saleable quality,” McQuitty added. “We anticipate drilling up there before the end of the second quarter. That will be both infill drilling to increase confidence in the resource and exploration drilling to expand the resource and expand other targets in the region. “Assuming we tick all the boxes and we drill it out this year, we’ll go to feasibility study stage.” McQuitty said the Perth-based company would seek to raise funds to develop the project itself, with a view to production in late 2016. “Our investigations point to Thunderbird being one of the top tier zircon deposits, in terms of contained zircon and the in situ grade,” he said. “It’s a deposit that has a dual value its zircon and titanium minerals. It stands up as being globally significant. “It’s definitely a company-making project. In terms of the required capital, it’s not necessarily beyond the means of a junior company. But we still have a bit of work to do to get to that stage,” he concluded.

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The first drill hole at the Thunderbird deposit.


WA Minerals & Pilbara In Focus

Water works A project to upgrade the West Pilbara water supply is underway.


ork to upgrade the West Pilbara Water Supply Scheme (WPWSS) is underway as part of a project to provide secure supplies to communities in the region. Western Australia Water Minister Bill Marmion said the Water Corporation upgrades would cater for additional flows from Rio Tinto Iron Ore’s new Bungaroo Valley groundwater source. The first stage of the project will cost $42 million and is due to be completed by August. Rio Tinto previously announced plans to build and operate a new borefield with an annual capacity of 10 gigalitres to be located in the lower Bungaroo Valley, 35km southeast of Pannawonica. The project frees up water previously utilised by the company for use by towns in the West Pilbara.


Business and industries in these towns can continue to plan investment projects with water available to meet the demand of a rapidly growing population. Confirming the works were underway, the minister said: “In September 2011 the state government secured an agreement with Rio Tinto to surrender its annual entitlement of water from the Millstream aquifer to develop its own alternative water supply from the Bungaroo Valley. “By developing this new source, Rio Tinto will free-up water from existing sources that can be used to support future development in Pilbara towns,” Marmion said. “Business and industries in these towns can continue to plan investment projects

with water available to meet the demand of a rapidly growing population. “The first stage of the project to upgrade the WPWSS includes replacing and burying 11.3km of pipeline with bigger pipes to accommodate more water through the system, along with new regulating valves to improve efficiency. “The first stage is due to be completed by August this year, to coincide with the availability of Rio Tinto’s new supply from Bungaroo, at a cost of $42 million.” A nine million litre tank along the pipeline will also be replaced in a separate

MARCH 2013 amm

Up and running: Rio Tinto’s Hamersley Agricultural Project was launched last year.

piece of work due to start later this year. The WPWSS already supplies Karratha, Dampier, Roebourne, Wickham and Point Samson. A spokeswoman for Rio Tinto confirmed the project was on track to be completed by the second half of 2013. It follows the successful launch of the

amm MARCH 2013

company’s Hamersley Agricultural Project (HAP) late last year. Water is flowing through irrigation centre pivots, using surplus supplies from below watertable mining at the company’s Marandoo mine. Situated 45km northeast of Tom Price in the Pilbara, HAP was the first project of its kind in the region.

It relies on 35km of mild steel pipe, 22 pumps and large scale associated pumping infrastructure. The project irrigates about 850 hectares of land, using very large centre pivots, each able to cover an area of between 4050 hectares.


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WA Minerals & Pilbara In Focus

The WA guide Gemstone enthusiasts planning to spend their weekends hunting for rare pink diamonds now know where to look. Mines and Petroleum Minister Norman Moore with the book’s authors.


nyone hunting gemstones in Western Australia are being urged to consult a comprehensive publication about the state’s gems and decorative stones. Entitled Gemstones of Western Australia, the 306-page book was produced to assist experienced fossickers and amateur rockhounds, as well as professional geologists and gemmologists. Mines and Petroleum Minister Norman Moore launched the publication, which covers gems ranging from diamonds and pearls to opals and beryl. The book is the first substantial and systematic work on Western Australian gemstones by the Geological Survey of WA (GSWA) and was produced in collaboration with the Gemmological Association of Australia’s WA division. Speaking at the book launch in Perth, Moore congratulated authors Michael Fetherston of GSWA, Gemmological Association WA curator Susan Stocklmayer and consultant geologist Vernon Stocklmayer. “This is a comprehensive resource on gemstones and decorative stones used in jewellery and ornamental sculpture in WA,” Moore told guests. “It outlines geographic locations of known deposits which will assist fossickers searching for gemstones throughout the state. “The book combines geology and gemmology to provide factual information and each chapter has detailed mineralogical information as well as their geological setting and location. “This publication is a much-expanded update of a series of booklets entitled Gemstones in Western Australia, produced by GSWA between 1975 and 1994, including abundant references to earlier work.” The Minister said that while WA had a growing international reputation as a major source for rare fancy pink and other coloured diamonds, far less was known about occurrences of gems such as beryl, topaz, tourmaline, gem-quality quartz and associated siliceous minerals. Moore said the publication also focused on materials particular to the state, including zebra stone, orbicular granite and mookaite, along with pearls, fossil wood and precious metals.


It contains information on the physical properties of gemstones, principal localities, advice on prospecting and covers safety and

survival for those heading to remote areas. The book is available in both digital and print.

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WA Minerals & Pilbara In Focus

Work underway at the Empress decline of Tindals Underground Mine, near Coolgardie.

Focus on the future A review is underway at Focus Minerals, following the departure of its chief executive and a $A27.4 million half-year loss.


n the space of just a few weeks, Focus Minerals has completed a $225 million placement, launched a drilling program and begun a search for a new chief executive officer. Just hours after CEO Campbell Baird announced his

resignation, Focus informed the market of a net loss of $A27.4 million for the six months to the end of December. Chairman Don Taig, who was a founding director of Focus Minerals, is acting as executive chairman and CEO. Just a few weeks ago, an action-based review was launched to restore the business, and a search for a new CEO was underway. Baird’s departure comes in the wake of China’s Shandong Gold International Mining Corporation securing a majority 51% stake in the Australian gold producer after committing to a $225 million investment.

The company said the loss was primarily the result of large expense items, including $26 million in amortisation.

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In the December quarter, Shandong executive chairman Li Zhongyi, general manager Zhang Dahui and deputy general manager Michael Guo were appointed non-executive directors of Focus. The company said the loss was primarily the result of large expense items, including $26 million in amortisation, of which a majority of the cost was for the pre-strip of the Apollo pit complex near Laverton, Western Australia. The company also cited $15 million in royalty payments, including $9.6 million for an inherited royalty obligation with respect to a long-standing agreement on selected tenements in the Laverton region. Taig said profitability for the first half of 2013 had been impacted by a number of one-off costs at its Laverton operations. However, he offered reassurance in an ASX announcement to shareholders. “I am now leading an action-based review with our management team, committed to restoring our business to profitability and, with the valuable support of our major shareholder Shandong Gold, repositioning the company as a low-cost, high-value enterprise,” he said. Gold production in the first half was 90,056 ounces, while revenue totalled $130 million, up from $104 million. At the end of December, Focus had cash and equivalents of $225.8 million following its placement to Shandong Gold.


With the company transitioning between primary ore sources at both Laverton and Coolgardie, production from the second half of the year is expected to be between 60,00070,000oz.

At the end of December, Focus had cash and equivalents of $225.8 million following its placement to Shandong Gold. The company kicked off the year with drilling programs across its Coolgardie and Laverton operations, and more than 40 priority targets have been identified across its tenement package. A key focus of the program is a 4km long anomaly on the eastern zone of the Treasure Island project, which is located on the Boulder Lefroy fault, 35km from the major gold camp of St Ives in Kambalda, WA. Following the announcement that Baird had resigned from the company, Focus said the search for his successor would begin immediately.


Drilling underway at Treasure Island.

A statement released by the company said Taig was being supported in the interim by the business’s senior leadership team, including chief operating officer Mark Hine, chief financial officer Paul Fromson, and head of geology Dean Goodwin. Taig has extensive senior management experience at managing director and CEO level through a number of major Australian

companies, as well as 11 years within CRA’s mining business. “The board would like to thank Campbell for his accomplishments and the establishment of a talented and experienced management team that is well-positioned to lead the company’s future success,” Taig added.


Site Visit: Ausdrill

Gaining purchase From its humble start as an exploration drilling business in the Western Australian Goldfields 25 years ago, Ausdrill has grown into an international mining services company. Alison Middleton takes a tour of the company’s Perth operations, courtesy of DT HiLoad Australia, Best Tractor Parts, Drilling Tools Australia, Remet Engineers and MinAnalytical.

RC exploration at Lake Lefroy in the Goldfields of WA. Courtesy of Ausdrill


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Jumbo operations at the Akwaaba Decline in the Chirano Gold Mine, Ghana, West Africa. Courtesy of photographer Hugh Brown


usdrill started life as a drilling company in Western Australia more than 25 years ago. Today, it is a global giant, employing more than 5000 people and boasting a billion-dollar revenue. It can no longer be considered just a drilling company. Indeed, Ausdrill has diversified into a mining services company made up of 18 separate businesses. The company is led by the same man who founded Ausdrill in his Kalgoorlie garage 25 years ago. With a firm grasp of the company history and evolution, Australia’s Mining Monthly began a tour of Ausdrill’s Perth operations. Chief financial officer José Martins led the tour and wasted no time in clearing up any questions about the business revenue. “When people think about Ausdrill, they think about exploration drilling,” he said. “That’s only about 10% of our business –75% is production related.”


KEY FACTS • 1987 Ausdrill begins with a single drill rig in Kalgoorlie • 1991 the company expands operations to Africa • 1993 Ausdrill adds contract mining to its services • 1994 company floated on Australian Stock Exchange • Employs more than 5000 people in 18 businesses across nine countries

Steering away from contract mining in Australia – and avoiding a clash of interest with key customers such as Theiss, Downer and Leightons - Ausdrill instead chose to focus on diversifying through equipment hire, logistics and manufacturing. First stop on the tour was Best Tractor Parts, which carries a range of second-hand parts for earthmoving equipment.

The practicality of the business is undeniable through the provision of parts ranging from engines and transmissions to hydraulic pumps, wheels and undercarriages. Caterpillar, Komatsu, Hitachi and Liebherr parts are reconditioned by engineering and service teams, and either sold, hired or exchanged. And crucially, following the acquisition last year, Ausdrill is treated like any other client and required to pay a fair price for the service. Haul truck body designer and manufacturer DT Australia was next on the tour. Arriving at the Perth workshop, we were introduced to the team behind the design and manufacture of the Hercules dump truck body. Reaching up to a 300-tonne payload, the Hercules is a lightweight, heavy-duty tray that fits all truck makes and models. Suitable for mining of all commodities, the trays are popular with contractors who often transfer vehicles between mines. Despite the massive size of the trays,


Site Visit: Ausdrill which are designed to maximise the payload, the Hercules can be manufactured to order in just six weeks and has been proven to last more than 80,000 hours. With growing demand for its drill and blast services, Ausdrill spotted another opportunity in its diversifying business, with the creation of a custom-designed laboratory for geochemical and precious metals analyses.

“When people think about Ausdrill they think about exploration drilling. That’s only about 10% of our business –75% is production related.” – Jose Martin

Best Tractor Parts has a large fleet of earthmoving equipment for hire and sale.

Following a $10 million initial investment, MinAnalytical provides the mineral exploration and mining industry with an assay service, analysing minerals including gold, platinum group metals, base metals, and rare earths. Backed by a staff of about 100, the service

You may know us as open pit and underground mining contractors. Or as the exploration and drill and blast specialists. Others know us for our supply and logistics services, mineral assay labs, the drill rigs we build or the drilling consumables we manufacture. The truth is we’re all of these things and more. Together, the mining services businesses you know and trust are all part of the Ausdrill Group. get to know us at

Bringing more to mining 58


has continued to ramp up and just been extended to include iron ore samples. Beginning with an initial service of 1000 samples, MinAnalytical is already anticipating tripling the service to accommodate iron ore miners. Next stop on the Ausdrill tour was Drilling Tools Australia, where a tour of the workshop showcased the high level of expertise and technology utilised by the company. The company is a key part of the Ausdrill Group, thanks to its success in manufacturing and supplying drilling consumables with the benefit of in-house, site-specific customised design and manufacturing capabilities. At full production, the site can produce 4500 drill bits a month. Blast hole and reverse circulation bits, top hammer threaded bits, and hard and soft rock mining bits are all manufactured onsite. With the drill bits taken care of, we only had to walk round the corner to Remet Engineers to find Ausdrill’s source of drill rods and down-hole drilling equipment. Remet prides itself on having a well-earned reputation for providing drillers with the rods they need to work more accurately and for longer. Aside from the close team and extensive manufacturing capabilities, Remet uses friction welding technology to provide the

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Bringing more to mining AMM MARCH 2013


Site Visit: Ausdrill

Ausdrill managing director Ron Sayers and the team that helped restore this 1961 P42 Schramm drill rig. Courtesy of photographer Hugh Brown

best tool joint, giving a rod that is strong and precise. Suitably impressed and with slightly sore feet, the press contingent was invited to round up the visit with a boardroom lunch at Ausdrill’s Perth headquarters – with the man who started it all. Well known for his direct approach but reluctance in talking to the media, managing director Ron Sayers was remarkably frank about what keeps him in the business at the age of 60.

With growing demand for its drill and blast services, Ausdrill spotted another opportunity in its diversifying business. “If you can develop a relationship with a client early in the exploration phase, you can sometimes take that right through to the mining operation as well,” Sayers said. “That’s our philosophy. In Africa in particular, we say ‘from cradle to the grave’.

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Bringing more to mining 60


An exploration driller in the Goldfields. Courtesy of Ausdrill

“We can go to site, set up camps, do the exploration drilling, and we’re now in the position to do the assay sampling as well. And we can do the mining for them.” Sayers, who is due to retire in 2014, said all the equipment in the world would be useless without the right people to operate it. “We’re very big on looking after people,” he added. “We train a lot of apprentices. “My logic is that if I’ve spent four or five years training an apprentice, I want to hang on to them. “We have a great collection of businesses – they are culturally all very similar. And we try and keep it that way.” Sayers described an in-house scheme called The Ausdrill Way that raises more than $300, 000 a year from employee contributions. “We get the employees to put a couple of dollars a week into a fund to assist their workmates, should they run into hard times,” he said. “The company matches it dollar for dollar, and that money is distributed by a committee. “For me, what I get out of this company is pride. I see the way we operate and I think we’re world leaders in everything we do. “We compete on a world stage and against the world’s best – and win. That is because we all learn from each other.”

Drill down and you’ll see the hammers and bits made by DTA, and the rods and subs made by Remet, deliver the best cost per metre. That’s because our consumables are designed and made by drillers for drillers. Our quality is your quality. So if you’re in drill and blast, exploration or water well drilling, talk to both of us. Call 08 9311 5656. get to know us at

Bringing more to DriLLing AMM MARCH 2013


Mining Brief

Farewell to Oakleigh The last open cut coal mine in the Ipswich region has ceased operations. By Alison Middleton


oal producer New Hope has confirmed the end of an era with the closure of the last open cut coal mine in the Ipswich region of Queensland. New Hope Group said the New Oakleigh mine at Rosewood had come to the end of its productive life and ceased mining operations at the end of January. Chief operating officer Bruce Denney said the company, which formed in Ipswich in 1952, would continue its strong links to the local community through its nearby Jeebropilly thermal coal mine. “The people of Rosewood and Ipswich have been very supportive of New Oakleigh, which has been a significant economic spur to the region since its beginnings in the early

part of the last century,” he said. “New Hope’s high proportion of long-term staff members also have very fond memories of this area’s coal mining history and, in particular, the New Oakleigh site.” The company has been working closely with about 30 staff members at the site to find other positions within New Hope. Some staff will be retained at the site following the closure of New Oakleigh’s coal operations to continue rehabilitation work, which is expected to take several years to complete. Ipswich rose to prominence as the railway and manufacturing hub of Queensland in the early 1900s because of its readily accessible coal deposits. The collieries supplied coal for gas

New Oakleigh mine at Rosewood in Queensland has ceased production.

production, the state railway workshops in Ipswich, steamship bunkerage, electricity generation and local industries. By the 1960s the area supplied about 60% of the total state coal production from 51 collieries with 2000 employees. Much of the coal mined in the early days was hand-mined by small groups of miners working outcrops in partnership. Coal was extracted from seams by pick and shovel and conveyed by basket, sledge or tram to the surface by manpower using ropes and chains and later by horses. The original Oakleigh Colliery company began in 1948 when the Rule family acquired the mine near Rosewood, which had started as a pick and shovel operation.




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Focus: Alumina v Nature

Dieback, alumina and forrests Could a disease that affects trees really halt Australia’s aluminium industry? John McIlwraith looks back on a battle between environmentalists and miners.

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t was regarded as an environmental threat of unprecedented proportions, yet it is rarely heard of today. Dieback (Phytophthora cinnamomi), it was predicted by a scientist, would almost wipe out the forests of Western Australia’s Darling Range. Environmentalists at the time pointed to bauxite mining as one way this would occur. The disease was – and is – a serious threat to forests, and other plants, occurring throughout the world. It was brought to Australia with early colonists, but was not identified until nearly a century ago. The bauxite miner Alcoa of Australia, the first of two companies to extract this raw material for aluminium from the Darling Range, came under great pressure from environmental groups. Environmentalists feared that the shallow mining of the mineral would lead to the spread of dieback across the range. There were demonstrations against mining, and well-intentioned scientists joined the call for a mining ban. Governments imposed strict conditions – and, in fact, Alcoa exceeded them in its own policies. But it wasn’t until the new forests began to grow and the quarantine measures could be assessed that the doomsday scenario began to recede. Now, 40 years later, there is a positive environmental outcome to report. Stringent hygiene in the forest and intensive research has meant that the spread of dieback that can be attributed to bauxite mining is marginal. Paradoxically, it has been found that reforested areas on mining pits have less risk of being attacked by dieback than unmined ground (drainage is a factor, as dieback thrives in damp conditions). In 1979, a WA government sponsored committee predicted that mining would spread dieback to a hectare of forest for every hectare it cleared. Detailed monitoring of the spread of dieback was undertaken following the introduction of intensive dieback management procedures, and the actual rate of spread was found to be between 0.0006 and 0.003 ha for every hectare mined. Alcoa has won many awards for its environmental management, particularly developing techniques that have enabled it to reintroduce most of the plant species that existed before mining. In particular, there are stately stands of jarrah, once thought impossible to introduce. Alcoa began planting them 25 years ago and the oldest have grown to a considerable size. The hundreds of hectares of new forest have been a success, but some critics of the scheme suggest that it is not completely natural in

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appearance. Because all of the trees are almost the same size, the forests lack the diversity of a natural one. Alcoa questions this concern. A number of measures have made the restored stands of trees very similar to untouched forest. Alcoa has ambitious goals for the restored areas. Its environmental scientists point out that the rehabilitation is a mosaic of regrowth forest within the unmined areas. The aim is to reintegrate the regrowth forests into the broader forest management so that they would be subject to the same measures, such as prescribed burning and future timber harvesting Alcoa has faced other environmental challenges, particularly complaints from local communities that fumes from its alumina refineries are harmful, a claim the company rejects after independent studies by a number of scientific bodies found no harmful effects. The usual equation of benefits and costs come into play. Alcoa, and the other local alumina producer, Worsley Alumina, are among the

biggest producers in the world, providing a sixth of global output. High electricity costs in Western Australia have always been a barrier to aluminium smelting, but its alumina goes to smelters in other states and is exported to a number of countries.

Environmentalists feared that the shallow mining of the mineral would lead to the spread of dieback across the range. When the industry was launched more than half a century ago, after discoveries of vast bauxite deposits near Perth, there was little mineral processing carried out in Western Australia, with gold a notable exception. Western Mining Corporation, much later absorbed by BHP Billiton, did not have the capital to launch the alumina project, and

successfully approached one of the world’s biggest aluminium producers, Alcoa of the US, to become a major shareholder. The industry grew rapidly, and the two alumina companies in the Darling Range produce about one sixth of the world’s output. The commissioning of a major smelter by Worsley Alumina confirmed the region as the world’s leading producer. But little of this would have been achieved if the well-meaning opposition of environmental groups had been successful. The serendipitous effect that occurs after mining, with the new conditions that occur in the soil, are not favourable for the spread of dieback. It seems that the removal of the naturally occurring caprock during mining, improves drainage, compared with the natural forest, making it a much less favourable environment for dieback. The stringent routines of washing of equipment, and careful shielding of unaffected areas, have also checked the disease. Hopefully, forever.

Battle: Environmental concerns threatened bauxite mining.

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Mining Brief

Pilbara through a lens Leading international photographers have captured the lives of people in the Pilbara. By Alison Middleton


photographic interpretation of people in Western Australia’s Pilbara has been unveiled in a project seeking to celebrate the region’s diverse heritage, individuality and experiences of everyday life. Vogue and New Yorker photographer Bharat Sikka and Magnum photojournalist Martin Parr are among the photographers who took part, along with Annet van der Voort, whose work has been published in Vanity Fair, Le Monde and The Guardian. International award-winning Indian artist Ketaki Sheth and Australian photographer John Elliott joined the photographic and social documentary project to reveal how the region had been shaped by people of 52 nationalities. The resulting exhibition, Pilbara Stories, is hosted by FORM, a Western Australian non-

Robert Brooking, BHP Billiton’s Nelson Point operations, Port Hedland, photographed by Annet van der Voort.

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Amy Jo Ryan, South Hedland, photographed by Annet van der Voort.

Chelsea Churnside, Wickham, photographed by Ketaki Sheth.

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profit organisation which aims to encourage and develop creativity in the state. Regional Development Minister Brendon Grylls opened the exhibition at FORM’s gallery in Perth. With images augmented by taped conversations and written accounts of personal histories, Pilbara Stories features more than 100 portraits that aim to celebrate the diverse heritage, individuality and experiences of everyday life in the Pilbara. Guests invited to the opening heard that BHP Billiton and FORM had been working in partnership for the past nine years to engage and empower Pilbara communities. Speaking at the opening of the Perth exhibition, BHP Billiton head of community and indigenous affairs Richard O’Connell said BHP was very proud of its involvement with FORM. “This project tells an exciting story about what is happening in our state of Western Australia,” he said. “It’s very humbling for BHP Billiton to be involved in this way. “The Pilbara is, of course, the backdrop to the success of the iron ore business. “We are very grateful to be engaged in the area, but we understand that the resource is only one part – the people are another.” Pilbara Stories can be seen at the FORM Gallery in Perth until April 20 and at the Courthouse Gallery in Port Hedland until April 11.


Drill & Blast

The best policy With a $100 million contract underway in Queensland, Action Drill & Blast says partnership and customer service are the keys to success. By Alison Middleton


“best for site” policy has enabled a drill and blast company to meet targets and reduce costs on a $100 million contract. Action Drill & Blast was commissioned by construction contractor John Holland to provide blasting, shot firing and explosives

management services at the Isaac Plains coal mine in central Queensland. More than 23.5 million bank cubic metres have already been blasted at the mine, which is owned by Isaac Plains Coal Management and is currently producing about 2.8 million tonnes of coal per annum.

Isaac Plains coal mine in Queensland.

With work well underway, Action said its commitment to “best for site” meant it had consistently met its project and safety targets and implemented initiatives to reduce costs. The three-year project scope encompasses mark-up blast holes, quality assurance dipping holes, backfilling holes, stemming

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Drill & Blast holes, loading holes, tying in blast holes and fume management. Action, which has its head office in Perth, Western Australia, and a regional office in Rockhampton, Queensland, has 20 staff on site. A drill and blast superintendent, leading hands, trainers, HSE advisor, shot firers, fitters and blast crew make up the team, which is using Volvo trucks, light vehicles and Manitou stemming loaders. Action Drill & Blast Queensland manager Mark Hall said the firm’s experienced team had been critical in both executing difficult jobs and maintaining quality standards. “We pride ourselves on strong customer service,” he said. “Working closely with clients to understand their requirements is a key part of what we do. “It’s not just about the explosive, but the detail and effort that goes into delivering consistent high quality, such as ensuring the drill holes are the right depth or that the direction of firing is correct. “This produces the most consistent outcome for the client by producing better fragmentation, which in turn increases the client’s bulk cubic rate movement and resultant cost efficiencies,” Hall said. Action worked with explosives supplier Dyno Nobel to review the explosive supply

logistics chain and develop ways of getting explosives to site more efficiently. The team also holds daily and weekly client meetings to review forecasts, daily production rates and to go through any issues with key stakeholders.

“This produces the most consistent outcome for the client by producing better fragmentation, which in turn increases the client’s bulk cubic rate movement and resultant cost efficiencies.” – Mark Hall IPCM general manager Jason McCallum said: “Action has demonstrated attention to detail in the pre-loading activities. “This preparation work is paramount in achieving consistent quality results in fragmentation and cast.” “To date, Action’s blasting has exceeded our expectations. “They have a strong leadership team and

constantly engage with the on-site employees to maintain correct practices, which results in consistent delivery, day in and day out. “Action continuously looks at ways to reduce costs.” Action said safety best practice had been upheld with a dedicated trainer on-site for the first six months to ensure that all the team were fully trained on equipment and maintenance procedures. Dedicated health, safety and environment advisors are also onsite full-time with regular inspections taking place, and line managers receive formal training for a nationally accredited diploma of management. In addition, explosives supply, accessories and storage are often a critical part of Action’s drill and blast contracts. John Holland project manager and site senior executive Brendan Pambid said: “There is a willingness from the team to come to the table and assist in the project, either from a financial, production or business improvement perspective. “Working with Action is a partnership, they have a great desire to make things work,” he added. Action’s contract at Isaac Plains runs to 2015, and could be extended to include the planned expansion into Isaac Plains South. Self-proclaimed as the fastest growing drill


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MARCH 2013 amm

Action Drill & Blast’s onsite team.

and blast contractor in Australia, Action has a team of shotfirers and blasting contractor specialists experienced in coal, magnetite, hematite, gold and nickel. Teams are experienced in the use of blast design and management software such as 2D Bench, and trained in restricted blasting in close proximity to existing or working infrastructure and dealing in areas of cultural or environmental sensitivity. Action’s engineers are trained to carry out blast operations ranging in size from contour shots through to large pattern and production blasts.

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“They have a strong leadership team and constantly engage with the on-site employees to maintain correct practices, which results in consistent delivery, day in and day out.” – Jason McCallum Specialising in complete end-to-end drilling and blasting services, Action said it was currently operating more than 30 contracts. Current projects include scope drill and blast services for civil mining contractor NRW Holdings. Action Drill & Blast was commissioned

to establish diversion drains for new roads and new mining areas at Rio Tinto’s Yandi Sustaining Project in the Pilbara. Teams commenced the works in December 2012 and the project is scheduled to be completed next month.


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A shorter charge cycle time may be achieved by pre-assembling detonators prior to arrival at the face and by reducing the process required for packaged products. Compared to blow loaded ANFO, the TITAN 7000 emulsion system provides increased velocity of detonation, shock energy and fragmentation to allow full advance. It also has a lower post-blast fume, allowing for quicker re-entry after firing.

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Drill & Blast

Australian debut The smallest raise drill ever designed has arrived in Australia.


ining contractor Redpath says it has developed the lightest and most compact raise drill ever seen in the Australian

market. Specifically aimed at faster boxhole drilling, the Redbore 30 was designed to improve safety while working in confined underground conditions. With increased mobility and low clearance heights, Redpath said the new drill was much lighter and easier to move between sites using an integrated tool carrier. A new base, called the Octopus, allows the drill to be locked into the side walls, removing the usual need to first pour a concrete slab for the drill to sit on. Designed in Australia in conjunction with Redpath’s Canadian raisebore design


Designed after a group of drillers and mine owners put forward their “wish list” of features for the ideal raise drill, the Redbore 30 can also be remotely operated. engineers, the Redbore 30 has been developed specifically for block-cave operations but can be used on any box holes. Based in Ontario, Canada, Redpath moved into Australia with the acquisition of midsized Australian mining contractor Eroc Pty and established a regional base in Brisbane, Queensland. Designed after a group of drillers and mine owners put forward their “wish list” of features for the ideal raise drill, the Redbore 30 can also be remotely operated. It measures just 3.9m high and 1.4m wide,

with a total weight of 4.1 tonnes for the actual rig. The drill’s hydraulic motor produces 133 kilonewtons of force for pilot hole drilling and 444kN for reaming. Redpath raisebore general manager Allan Brady said: “This is a raisebore built by raiseborers with more than 50 years experience. “We are confident it will be extremely popular with both new and existing clients for its ability to increase productivity and lower the operating cost for the client.


The Redbore 30’s compact design means the rig is easily transported to site.

“Raise drilling is the fastest and safest method of developing raises, provided you have the infrastructure and power in place. At Redpath, we are committed to consistently improving our raise drills to make them safer and more productive at every opportunity.” Another new safety feature of the Redbore 30 is the scissor-styled deflector plate which is stronger and can take more weight. It increases the safety for the drill operator by providing greater protection from falling rubble and folds flat for easy transportation.

financial cost,” Brady continued. “Now our clients can design smaller drives which can be easily accessed by the Redbore 30 because of its compact size and ease of transport on an integrated tool carrier, saving money and removing the need to get more personnel

involved.” The Redbore 30 also features an energy-efficient power pack, which has been combined with the operating console into one unit to make the two-piece compact drill extremely mobile.

The drill can create raises up to 20m in length to a diameter of 1.06m, with a back height of less than 4.5m. The drill can create raises up to 20m in length to a diameter of 1.06m, with a back height of less than 4.5m, which the company said made it an excellent choice in tight conditions. “Previously, when the dimensions of a drive became too small for a drill to enter, the operator would have to resort to handheld rise mining, which can be quite risky, or simply enlarge the space at a greater

amm MARCH 2013

Redpath’s Redbore 30 compact raise drill.



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Drill & Blast

Sandvik design Sandvik are proud of the Alpha 330 drill tool system. And so they should be, if it delivers faster, more accurate drilling.


andvik Mining has announced the release of an advanced alternative to the R32 connection system that has been used by miners since the 1950s. The Alpha 330 drilling tool system was designed to deliver 30-80% longer rod life than the R32. And with exact collaring and straighter holes, the Alpha 330 system brings benefits including further reductions in drifting and tunnelling costs. Sandvik Mining product support manager for tophole and down-the-hole drills Des Leonard welcomed the release. “The Alpha 330 drilling tool system has been developed to match the increased energy output from modern high-power rock drills in drifting and tunnelling applications,” he said. “The Sandvik Alpha 330 drilling tool

system has been designed to effectively control drilling power and, most importantly, ensure that it is transmitted into the rock as efficiently, accurately and economically as possible.” Designed and dimensionally optimised as an alternative to R32 connections, which has been the dominant 45mm system, the drill string rod and bit connection features an entirely new thread design. “A shorter thread on the hexagonal rods in the tool system results in a rigid, integrated power pack drill string with superior resistance to bending stresses, securing perfect energy transfer,” Leonard said. “This sturdy thread design is well guided inside the bit skirt, offering higher precision in collaring – even in complex rock formations and uneven surfaces.

Sandvik Mining’s Alpha 330 drilling tool system.

“More steel for higher fatigue strength ensures a significantly more rigid connection, compared with the R32, resulting in exact collaring and straighter blastholes – and delivering a 30-80% increase in rod life. “This results is in higher rates of advancement, improved profile-control and a further reduction in the overall cost of drifting and tunnelling through Sandvik Mining technology.” Sandvik said the Alpha 330 system took advantage of an inherently stronger and more rigid R33 thread with a significantly larger cross-section than the R32, which made it proportionately stronger. “The thread is guided inside the bit skirt, offering high precision in collaring,” added Leonard.

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• Vertical drilling • Asset maintenance • Underwater drill and blast • Precision/controlled explosive blasting • Earth stakes • Marine construction • Maintenance Services • Barge Hire • Boat Hire • Silt dredging We specialise in precision blasting within close proximity of vibration sensitive structures and pipelines and cable trenches on and offshore. Our drill rigs have the ability to meet all our clients’ needs including development work, drilling and installing earth stakes including the earth enhancing compound, drilling and blasting alongside railway lines and drilling over pipe and railway lines with our Montabert drill rig. We also have the ability to marinise our air-track drill rig for sub sea drilling. Our specialised skills see us working throughout many parts of Australia. With over 25 years of experience, we understand your industry’s needs. We offer a full range of drilling and blasting, commercial diving and maintenance services to the mining, construction, marine and pipeline industries.

Cervan Marine Pty Ltd Ph: 08 9173 2146 Fax: 08 9173 1403 Email:

Drill & Blast

No prime concept Dyno Nobel uses an existing concept to take the sting out of blasting. Dyno Nobel blasting experts preparing for detonation.


lasting without a priming charge could increase reliability and improve safety, according to an industrial explosives and blasting services provider. Dyno Nobel has completed a series of trials that measured the effectiveness of using a detonator centralising device to replace a packaged emulsion priming charge in hard rock development blasting. Current practice is to use either a packaged emulsion or a cast booster priming charge to initiate explosives. While blasting without a priming charge is not a new concept in the Australian mining industry, Dyno said it had not been widely used. Dyno Nobel, based in the United States,

set out to test the feasibility of replacing the priming charges with its Scorpion device, which centralises and protects the detonator to achieve safer working conditions and reduce costs. Initial testing of Scorpion was conducted at Dyno Nobel’s technical centre in Mt Thorley, New South Wales, before onsite tests were carried out in Western Australia. Dyno said the testing was carried out to determine the detonation velocity of the bulk emulsion using Scorpion as the link between detonators and emulsion explosive. Constructed from extruded plastic, the Scorpion device comprises four fins attached to a central spine, which facilitate direct priming in small diameter blast holes, used in tunnelling and underground mine

development. Dyno Nobel underground and hard rock business development manager James Woodgate said successful onsite tests were conducted at the Telfer Mine of Newcrest Mining in the Pilbara. “The scope of the testing was focussed on blast holes on the face of the cut,” he said. “There were no reports of misfires of the tested faces.” Woodgate said testing had showed that the total price for the Scorpion and bulk emulsion per hole was significantly less than for the packaged emulsion primer and bulk emulsion. “Because the Scorpion is not an explosive, it is easier to transport and of less risk to operators,” he added.

Doosan Portable Power Power offer comprehensive national parts and service support for our full range of equipment including:

With over 20 branches Australia wide and an extensive network of authorised agents, Doosan Portable Power provide on-the-ground service support from modern workshops and factory-trained technicians, and a fleet of mobile service vehicles. We’ve also got you covered with part support with over 50,000 line items and an availability rate of over 90%.

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Drill & Blast

The all-rounder Boart Longyear is promising the ideal rig for multi-tasking mining contractors. Boart Longyear’s LX11 multi-purpose drilling rig.


S-based drilling product provider Boart Longyear has launched a multi-purpose rig for exploration drilling. The LX11 was designed as an economical drilling rig for the mineral exploration market. With improved safety mechanisms, track mounting and a smaller footprint, the medium-sized rig joins the LX6 and the LX16 in Boart’s line of multi-purpose rigs. Boart said the rig’s reverse circulation capabilities and diamond core drilling allowed exploration drillers to use one drill rig when encountering varying ground conditions, reducing downtime. Senior global product manager Justin Warren said the LX11 had been tested in South Australia and had proved to be capable

of handling Australian ground conditions. “Boart Longyear expects Australian drilling contractors looking to save on rig space and cost to be interested in the LX11, because of its multi-purpose use,” he said. “The LX11 drilling rig is the culmination of many years of hands-on experience, advanced engineering and field testing. “The versatility of the LX11 allows drilling contractors the ability to supplement the roles of multiple rigs with the simplicity of one, saving on equipment costs.” The LX11 can reach depths of 1450m using NQ rods via diamond drilling and depths of 325m using 4.5-inch rods via RC drilling. A 7.2m mast and a top drive head allow 6m rods to be pulled under the head for increased productivity. A top drive single rotary drill

head features 1200rpm and a maximum torque of 7.8 kilonewton metres at 100rpm. Several safety features are incorporated into the LX11, including a control panel for visibility, a remote control for driving the rig at a safe distance and an interlocked safety cage to protect drillers from the rotating drill string. The LX11 can also be equipped with a rod handler for safe and efficient handling of both RC and diamond coring rods. Designed for easier site access and manoeuvrability, the rig fits into a 12m cube container for shipping to remote locations. Boart said track mounting increased the mobility of the LX11 with the ability to handle steeper grades and lowering environmental impact.

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Dust Management

Settling the debate STOP DUST BEFORE




Understanding nozzle performance is the key to dust suppression For crushing, loading, trans-loading, dumping, washing, shearing, transporting or stockpiling, Spraying Systems Co has the simple or more sophisticated solution for dust suppression – anywhere. Many important factors determining the overall effectiveness of dust suppression. The importance of nozzle selection and correct spray angle is critical in capturing or knocking down dust particles over the designated area. Spraying Systems has the know-how on simple manual or solenoid valves for on-off control, through automated systems, that monitor operating conditions and make the automatic adjustments necessary to control pumps, nozzles and pneumatic devices, without operator intervention. Spraying Systems know the fundamentals in dust control. Our sales engineers are backed by a team of technical experts to guide mining companies on the complexities of the drop size required for a specific application and nozzle performance.

AN AUTO SYSTEM:  delivers a more precise spray  eliminates overspray of water and costly chemicals  minimizes maintenance problems caused by over-wetting

Water or chemicals? The debate over which is the most effective dust supressant continues. But does one company hold the answer? By Alison Middleton


hemical additives are reducing operating costs for mining companies and proving twice as effective in managing dust on mine sites, according to a dust management company. Western Australian-based Rainstorm believes it has the technology available to help mining companies manage dust problems. Based in Maddington, WA, Rainstorm said it provided a holistic service to miners, with products including PDX, a concentrated liquid biochemical used for lowering ore dust extinction moisture. The company already includes Rio Tinto, BHP Billiton, Alcoa and Atlas Iron among its list of mining clients, With demand from iron ore miners growing, Rainstorm said PDX was already proving to be a “game changer” for dust management. Rainstorm technical and sales manager Mason Trouchet said dust was best managed by preventing it from becoming airborne in the first place. “To be effective, dust control products must be able to cover large areas quickly, but must remain cost-efficient compared to applying water,” he said. “As the cost of water and sustainability issues become more prevalent, the gap has narrowed between using additives or just water to a point where it has simply become good business to use additives. “Rainstorm’s service and products are a package that will manage the dust twice as well but, most importantly, can be demonstrated to save money on most old-fashioned water-only approaches to dust control.” Biodegradable and non-toxic, PDX was developed by combining wetting agent formulations with biochemical active ingredients to reduce dust and improve the material handling of ore movements. Typically added at the primary or secondary crusher, PDX also reduces the amount of water necessary for dust management.


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An iron ore fines stacker prior to treatment with PDX.

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PDX overlaying iron ore fines.

“Rainstorm has PDX in use on several major iron mines and is proving to be a game changer in the flow and dust properties,” Trouchet said. “PDX changes the water that’s added to ores to bring up suitable DEM levels.” The company also provides DustMag road dust suppression and compaction agent which attracts and retains moisture from the air on minesite roads. And its Gluon waterborne polymer emulsion can be sprayed onto soil surfaces to form a veneer. This crust is resistant to wind and allows water to pass through. Supplied as a bulk liquid, Gluon is used as a dust control agent in areas where airborne particles cause problems and to prevent wind erosion of granular materials from stockpiles. Many minesite dust reports highlight unsealed roads as the single largest dust generation activity. This is followed by open areas and stock piles subject to wind erosion; and materials handling transfer points, including loading activities. Rainstorm has also introduced cannon application trucks for operation at mine and port operations to apply Gluon.


“That’s the holistic approach,” Trouchet said. “It means you need a suite of products, not just one solution.

“That stops the dust from becoming airborne in the first place.”

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Dust Management

The friendly veneer A dust suppressant specialist is offering mining companies an environmentally friendly solution.

Vital Chemical’s natural polymer being sprayed on a coal stockpile.


he first non-synthetic polymer for dust control has been launched onto the Australian mining market. Vital Chemical said it had developed a varied portfolio of dust and erosion products in response to Queensland

state government’s orders to restrict dust emissions on coal trains. The firm’s non-synthetic, environmentally friendly veneering product is proving to be particularly popular with the state’s mining companies.

Vital Chemical embarked on the research and development of a non-synthetic product, which was designed to have a non-detrimental effect on either ore or the environment. Its Vital Bon-Matt CDS 300 natural polymer is fully biodegradable and lasts for

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up to three months on a stockpile, or can be sprayed on to trains heading to a port. Applied as a concentrated liquid emulsion which is diluted with water, it provides a flexible veneer over the applied surface and rebinds on successive water applications, prolonging effectiveness. Unlike many dust management products, the product does not contain polyacrylamide resins, magnesium chloride, solvents or heavy and trace oils. And with the growth of extended producer responsibility and restrictions for mines to fulfil, Vital Chemical said that demand was growing. Vital Chemical general manager Letiscia Xavier said the company was experiencing increased demand for dust control products and services due to the increase in environmental restrictions and requirements for miners. “We are the only company that provides a completely natural polymer,” she said. “Dust from train wagons transporting coal poses several environmental and health concerns for communities located near the railway line. “We designed our products for environmental and user safety, and they are scrutinised from the concept through to research, development and supply.

Vital Chemical’s products can restrict dust emissions on coal terminal roads.

“Our products are also analytically tested in laboratories and university facilities to ensure they work before they are put to market.” The company quoted a study in the United States which found coal trains lost an average of 100kg per car during a 925km trip when not treated with a dust suppressant. “Vital Bon-Matt is a system which can be put into place really quickly,” Xavier said. “We supply the service, the product and assist with the infrastructure.

“Dust emissions following the use of the product are negligible and our clients are really happy with the results. “When we are looking at train veneering; the natural polymer is designed to withstand the long haul and wind speed, while being environmentally sensitive. “If clients want to use longer-lasting products that are still environmentally safe, they can opt for the synthetic range.”



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Minerals Education

Knowledge is power A Western Australian initiative aims to increase knowledge and awareness of limited rare earth elements. By Vetti Kakulas


hina has dominated the rare earth markets for the past 25 years. The nation produces 90-95% of global supply, and consumes 6570% of global demand. There are 17 rare earth elements, or critical materials, on the periodic table. Rare earths are categorised as critical materials because the forecast for demand will significantly increase between 2013 and 2016. For all countries, besides China, demand will increase from 35 kilotonnes per annum to 55kpta for rare earth oxides. Additionally, rare earths are critical as they are essential for the manufacture of technically advanced products, including computers, hybrid cars, wind turbines,

plasma televisions, mobile telephones and energy efficient lights. For the past three years, China has restricted its supply of rare earths to the rest of the world to maximise jobs within its own country. In 2010, the US Department of Energy released a report, Critical Materials Strategy, which has become the benchmark for defining critical materials. Since the rare earths supply is limited, it threatens the sustainability of the production of these technically advanced products. According to the report, demand for critical materials has grown more rapidly than demand for commodity metals, such as steel. The report states that global material

supply has been slow to respond to the rise in demand for the past decade because of the lack of available capital, long lead times and trade policies. Newly appointed Curtin University Critical Materials Initiative leader Dudley Kingsnorth said rare earths were essential for our modern way of living. Based in Perth, Western Australia, the Critical Materials Initiative aims to combine knowledge from governments, researchers and industry worldwide to determine demand for independent research and advice on critical materials. It will study rare earths, platinum, lithium and tungsten. According to Kingsnorth, there’s recognition worldwide for total supply chain

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Minerals Education Delivering innovations to the global resources industry through world class professional development training Upcoming Professional Development: Curtin University Critical Materials Initiative leader Dudley Kingsnorth is an expert in rare earth materials.

management of critical materials. And it was crucial the Critical Materials Initiative was developed to develop and continue research about the supply of rare earths. Manufacturers have even taken notice and are said to be asking mining companies where they can secure supply. Kingsnorth said there are numerous projects located outside of China that have potential to supply demand. The Critical Materials Initiative will collaborate with other international universities with “complementary expertise” in mining and processing to increase its knowledge on the supply chain of rare earths. “There is a broad range of research that would attract industry and government support, such as the use of high performance magnets in domestic appliances for greenhouse gas abatement,” Kingsnorth said. The world has been dependent on China for rare earths, but Kingsnorth believes that’s about to change as supply will soon come out of Australia, the United States, India and Kazakhstan. What miners and geologists have learned from studying rare earths needs to be applied for rare materials and requires an understanding of the total supply chain. Curtin’s Critical Materials Initiative aims to assist people in understanding that supply chain. “People do not want to be dependent on China,” Kingsnorth said. “I’m talking to mining, automotive and major electrical equipment companies about doing research to identify the economic and technological barriers to produce these rare earths outside of China.” Kingsnorth said he will be working with environmental scientists, mechanical engineers, economists, geologists and process engineers, who can all contribute in understanding the supply chain. Everyone who contributes to the service will get a rare earths quarterly newsletter from the Curtin Materials Initiative. It was Kingsnorth’s idea to establish the Critical Materials Initiative and Curtin appointed him to lead it last December. Kingsnorth has more than 40 years experience in the international mining industry, previously working for Rio Tinto, Shell, Alcoa, Ashton Mining and Bechtel. “We have a broad expertise at Curtin University so I can call upon those people to work with me in the research,” he said. The Critical Materials Initiative will be able to assist manufacturers who may be developing a new car or wind turbine. “Manufactures may require a new material element that may not be in common use at the time,” Kingsnorth added. “We will be able to assist mining and exploration companies identify the resources from all over the globe and the demands for future needs.” The Critical Materials Initiative aims to find minerals that are more likely to be processed more readily and economically, from the minesite to showroom.

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22-23 April 2013

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25-27 June 2013

Australian Mine Rehabilitation

6-8 August 2013

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JKTech Pty Ltd 40 Isles Road, Indooroopilly QLD 4068 AUSTRALIA Tel: +61 7 3365 5842 | Fax: +61 7 3365 5900 Email:


Minerals Education

Choosing the safe option Health and safety qualifications are becoming increasingly important in the resources industry.


ining companies are continually seeking candidates with health and safety qualifications. That’s according to the Industrial Foundation for Accident Prevention (IFAP), which says more mining organisations are seeking individuals qualified in hazard management. “Over the past decade, more attention has been given to the type and level of training provided to employees in order for them to effectively manage hazards in the workplace,” IFAP managing director Martin Ralph said. A Certificate IV in occupational health and safety has been identified as the entrylevel qualification to gain employment in the health and safety sector.

But Ralph said this scenario was changing in light of “national harmonisation” and the need for organisations to employ appropriately qualified health and safety professionals. To be eligible, it’s essential to have both qualifications at a tertiary level and relevant work experience in a health and safety role. It’s also important that the entry level person is able to apply that knowledge gained at the Certificate IV or diploma level in a workplace setting. IFAP specialises in occupational health and safety, workers compensation and injury management, construction and equipment skills, and fire and emergency response. The firm has six training centres in Australia - five in Western Australia and one in Gladstone, Queensland.

“A new entrant into the occupation, health and safety field may wish to complete IFAP’s Conduct Local Risk Control program,” Ralph said. Individuals completing the program are exposed to a simulated work environment, where a range of everyday risks occur. The risks include working at heights, confined space entry, interacting with portable equipment, hazards in a workshop environment, use of danger tags and lockouts, and working in trenches and excavations. “Participants are required to identify the hazards in this simulated working environment, assess the level of risks posed and implement appropriate control mechanisms,” Ralph said. IFAP is a not-for-profit organisation.

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Mining Recruitment

Internationally equipped Key considerations for mining companies cultivating and managing a global workforce. By Alison Middleton


orking to deliver project outcomes while operating across various time zones, languages and cultures is becoming standard procedure for mining companies with global operations. But when it’s not just the language, but the approach to time and tasks which differ, one firm says companies have to start with recruiting the right manager for overseas operations. Beasley Intercultural has gained a reputation as the “go to” company for firms tackling unconscious cultural incompetence, and teaching senior staff to re-learn communications skills. Company founder and managing director Tamerlaine Beasley said it was important to

contextualise cultural effectiveness. “One of the misconceptions about cultural effectiveness is that it’s all about manners and being polite,” she said. “It’s actually about business effectiveness. What we’re talking about here is efficiency, risk management, better due diligence, time and costs – and getting results. The context is very ‘big picture’. “There is a challenge of balancing the need for consistency of process globally, and universal process and practice, with the need to adapt to and respect local culture. “Many companies have learned the importance of this the hard way. If those things aren’t addressed or understood they can cause issues in terms of a company’s licence to operate.”

Beasley said there was a significant investment, particularly from larger mining companies, to “get it right”. “You need to know what you’re dealing with and if you don’t have the external expertise then you need to bring it in.” Miners often operate in areas affected by political uncertainty and different operational processes. So when it comes to finding the right person to lead mining teams in diverse cultures, Beasley said, mining companies should focus on recruiting people with core communication skills. “One of the misconceptions is that you have to know everything about a local culture, and often that’s not the case. Communication skills are critical.

Senior ConSulting engineer - underground unearth your Career Mining Plus is a dynamic, forward thinking, international mining consultancy actively servicing the mining and resources industry. They are progressively expanding their business and are in the process of developing a growing success story. They want you to be a part of it. Mining Plus prides themselves on fostering a fantastic, cooperative and flexible one team working culture. Practicality and innovation is in their DNA and instilled across all facets of their business by their ability to think laterally whilst challenging traditional thinking through innovation. With their ‘A-Plus’ team in place and plans for further expansion, they are committed to recruiting and retaining the best. They offer their employees a challenging yet rewarding career path, providing opportunities to work on interesting diverse projects on a local and international scale. Working in a dynamic team, you will utilise your diverse background in mining engineering across a wide range of projects. Some of your main duties will include mining studies, mine planning and optimization, mine economics, mine scheduling and business improvement. Further on you will be conducting ventilation modelling and general mine services studies including backfill and dewatering. Whatever your mining story, Mining Plus want you to write the next chapter with them as they are constantly on the lookout for ambitious mining professionals to join their growing company on an international scale. For more information, visit or contact Hays Resources & Mining on the details below. Contact Sara erlandsson at or 08 9254 4546.


MARCH 2013 amm

Hunted in the Hunter

Beasley Intercultural managing director Tamerlaine Beasley.

“To work in a culturally different context you need to be a good communicator. That doesn’t mean just speaking, it means knowing how to listen and how to get people to tell you things. “The capacity to adjust and adapt is important and tolerance of ambiguity would be the key things to recruit for. “The challenge of working in really diverse cultures is that you never know everything, and you’re never in control of everything, but you have to be able to perform regardless. “Some people just can’t cope with that. And if you can’t cope with it then you shouldn’t be working in those contexts.”

PoTenTIAL mining employees in the Hunter Valley are being provided with pathways into a career in the industry. The new South wales Minerals Council has been announced as naming rights sponsor for Skills on Show, a recruitment and training event held during this month’s newcastle regional Show. nSw Mining said it had increased its support for Skills on Show to promote jobs in the region and provide potential mining employees with pathways into a career in the industry. As part of the commitment, the council will operate an interactive information hub to provide career information, while industry representatives will be on hand to answer questions. Specialist mining equipment will be on display at the event for the first time, and visitors will be able to hear directly from senior industry and education representatives. nSw Minerals Council chief executive officer Stephen Galilee said the mining industry would continue to provide exciting employment opportunities for the people of the Hunter Valley for decades to come.

“It doesn’t matter whether you’re a student, a young person, or simply seeking a career change, nSw mining is an exciting and challenging industry to be a part of,” he said. “nSw miners have the opportunity to live and work in great communities like newcastle, Cessnock, Maitland, Singleton and Muswellbrook. “It’s a career that can either keep you in the Hunter, or take you around the world. “nSw mining has a range of roles to suit many different interests. “our support for Skills on Show is in addition to our dedicated nSw mining scholarships, which provide a number of eligible students across nSw with a grant for up to three years if they study a minerals-related degree or course.” The event comes on the heels of a report that illustrates the positive impact mining has had on the region’s economic growth. nSw Minerals Council welcomed the report by KPMG on behalf of the Minerals Council of Australia. Skills on Show is a large interactive visual display and event, which takes place during the 2013 newcastle regional Show from March 1–3.

Sponsored by ABB Power and automation company ABB has joined efforts to boost the numbers of engineers in the mining industry. ABB has entered into a five-year, $500,000 sponsorship agreement with the University of Queensland. The agreement includes the creation of an ABB Mechatronics Teaching Laboratory for students at the university’s faculty of engineering, architecture and information technology. More than 120 students will benefit from access to ABB’s IrB 120 industrial robot, System 800xA, and drives packages and automation equipment used for control engineering, mine ventilation and mine management. In addition to the on-site equipment, ABB said it would provide guest lecturers to share first-hand industry experience. ABB has committed to undergraduate scholarships for low socio-economic or indigenous students, and will award at least one three-year scholarship annually. The company will also sponsor a number of full-time research higher degree students with scholarships, as well as offering paid internships over the lifetime of the sponsorship. ABB said interns could expect to work on

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essential solutions such as mine hoists, conveyor systems, control and electrification systems, as well as specialty engineering projects. Variable speed drives and motors will give students an insight into the energy efficiency capabilities of ABB’s devices. Students will also be encouraged to explore how the technology can be used to reduce energy consumption across different mining applications. ABB Australia chief executive Axel Kuhr said: “The interns can expect wide exposure to different process and automation applications during their time with ABB. “our vision for this collaboration is to help the university develop industry-ready, highly skilled and globally focused graduates.” executive director of Mining education Australia and UQ School of Mechanical and Mining Professor Peter Knights welcomed the agreement. “The equipment donation to the laboratory will enable students to gain hands-on experience related to the design, construction and testing of their innovations.” said Knights. with global headquarters in Zurich, Switzerland, ABB has an Australian head office in Sydney.

ABB’s IRB 120 industrial robot.


Mining Recruitment

Keeping your core tight Recruitment firm Hays advises Australian mining companies on how to retain a workforce. By Vetti Kakulas


ne in three Australians will leave their employer in the first one to two years, according to mining recruitment firm Hays after it surveyed more than 2000 candidates about their job habits. The survey found 31% expected to change jobs every one to two years, while 39% considered leaving their employer every two to four years. Just 30% of those polled said they would stay with an employer for five or more years. Mining companies across Australia face a constant battle against an industry skills shortage. Hays resources and mining senior regional director Simon Winfield said a specific strategy for retaining top talent and curbing staff turnover had many positive outcomes for mining companies. “Firstly, it can help to prevent the cost of unexpectedly having to replace good staff,” Winfield said. “As most hiring managers know, the cost of such turnover adds significantly to a company’s expenses. “While it’s difficult to fully calculate the cost of turnover, it can often equate to 25 per cent of the average employee salary and this is a conservative estimate. “When an employee leaves there is the loss of not only valuable industry knowledge but knowledge about your company, customers, current projects and past history, which can take a long time to regain.” Customer and client relations can also affect staff turnover, which can influence an entire organisation due to other staff having to pick up the extra workload. “The rate of turnover can be reduced by implementing a few integral but simple retention strategies – and they don’t always involve money,” Winfield said. Some key retention tips include managing performance, developing leaders and having good relationships with staff. Hays said managers could retain staff by conducting regular employee performance reviews, as performance feedback helped improve employee talent and allowed them to set objectives and deadlines. “Candidates are also looking for good management, clear career paths and challenges, or even perhaps good relationships at work, to


Hays reveals one in three Australians will leave their employer in the first one to two years.

keep them engaged and satisfied with their roles and employers,” Winfield said. “Your managers are at the coal face, they should be good at motivating and inspiring their team members, managing performance – good and bad – and setting useful goals.”

Employees can become bored without proper career development. Hays suggests not just promotions but increased responsibility in the workplace, such as supervising other staff. Training and development is also crucial for retaining staff.

Easy access ONLINE recruitment firm Job Search Group has launched a mobile career website for jobseekers and mining companies. was designed to give candidates looking for a new career easier access to information. Job Search Group marketing director John Roberts said allowing job hunters to find careers “on the move” was a major focus for his team. “We know that more people are utilising mobile devices, which has prompted us to completely overhaul our mobile offerings this year,” Roberts said.

“Whatever the preferred access point, whether it’s desktop PC, tablet or smartphone, we can provide the job search facilities they need.” has had almost 4000 jobs posted by mining companies. Roberts said free applications for iPhone, iPad and android devices were in the pipeline for the company, allowing users to search, review and apply for jobs. Additionally, the website can notify the jobseeker of any job alerts as soon as roles became available.

MARCH 2013 amm


THE Chamber of Minerals and Energy (CME) of Western Australia has announced the appointment of Sarah Hooper to the position of director. She will be responsible for the portfolio areas Sarah Hooper of economics and tax, people strategies and the Resources Industry Training Council. In addition, Hooper will oversee the Eastern, Northeastern, Southwestern and Mid-Western regional operations. She takes over from Nicole Roocke, who will continue to oversee the environment, occupational health and safety, land access, Kimberley and mine security services portfolios, while also assuming responsibility for infrastructure and the Northwest. CME chief executive Reg Howard-Smith said Hooper was an experienced Australian diplomat and foreign policy expert who had worked across a range of high-profile bilateral relationships and multilateral foreign and strategic policy concerns. “Sarah has worked in the Department of Foreign Affairs and Trade, the international division of the Department of Prime Minister and Cabinet and in the Office of National Assessments,” he said. VENTUREX Resources has confirmed the appointment of Jim Mellon as a nonexecutive director. Mellon has more than 20 years’ investment experience in Asia and specialises in Jim Mellon the development and restructuring of international companies. His appointment increases the board’s commercial experience as the company progresses exploration and development options for the Pilbara copper-zinc project. Mellon is the non-executive co-chairman of Regent Pacific Group and co-founded the

Meet the presidents SANDVIK has announced changes to its group executive management and the appointment of new presidents to two of its business areas. President of Sandvik Materials Technology Jonas Gustavsson has been appointed president of Sandvik Machining Solutions. Gustavsson has been with the company since 2008 and previously held senior positions at ABB and Bombardier. Petra Einarsson has been appointed president of Sandvik Materials Technology and member of Sandvik´s group executive management. Einarsson’s career with Sandvik spans 22 years, most recently in the position of head of the tube product area at Sandvik Materials Technology. Sandvik president and chief executive officer Olof Faxander said: “Jonas Gustavsson and Petra Einarsson have a track record of improved profitability from company in 1990. Regent is Venturex’s largest shareholder, holding 31.87% of the issued capital. Venturex chairman Tony Kiernan said: “We are delighted to welcome such an experienced industry professional of Jim’s calibre to the board of Venturex.”

David Hegarty

ROCKWELL Automation has recruited an internal applicant to the role of managing director for Australia and New Zealand. David Hegarty has taken on a dual position and will maintain his previous role of regional sales director for

the region. Rockwell said Herarty brought a wealth of sales and marketing experience to the role,

Petra Einarsson

Jonas Gustavsson

Sandvik Materials Technology. “Petra Einarsson will leverage the positive momentum generated at the business area,” he said. “Sandvik Machining Solutions has developed a solid and successful strategy under his leadership. “Jonas Gustavsson, with his proven background as a successful leader, will focus on further developing Sandvik Machining Solutions and capitalising on its growth potential.” and had a firm focus on customer service. Since joining Rockwell Automation in 1999, Hegarty has managed branches in Sydney and Brisbane, and spent several years based in Singapore. SOUTH Australia’s recently retired senior trade commissioner to India has been recruited by resource developer Centrex Metals. AK Tareen has been appointed the company’s chief advisor AK Tareen for investment in India and South Asia. Tareen has more than 17 years experience in advising Australian government and businesses in India and helped grow South Australian exports to India by almost 800% during his eight-year term.

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Mining Software

Your Eureka Australian software firm Maptek believes its latest product can provide solutions for geologists. By Vetti Kakulas Maptek’s latest software, Eureka, was developed for geologists.


ining software provider Maptek has launched its latest interactive product, offering geologists data analysis on a

“large scale.” Speaking at the North American Maptek Users Conference in Denver, US, recently, Maptek chief executive officer Barry Henderson said the Eureka software was developed to help explorers satisfy global demand for minerals. “In the next 30 to 50 years, the world will consume as much copper that has ever been mined historically,” Henderson said. “The same applies to iron ore and other metals.” The Eureka software allows geologists to analyse exploration data and information on a large scale.

Geologists can view large datasets with millions of points, such as airborne magnetic and radiometric surveys, and imagery to be viewed in a three-dimensional environment. Features include “modern” graphics and tools that can convert seismic time data to depth, in tandem with drillhole information. Maptek said user accessibility was a common driver for its technology development. To complement the Eureka software, Maptek developed the Eureka Field tablet, which allows logged data to be synchronised between the tablet and Eureka desktop application. The sharing of data can then be initiated instantly, using Wi-Fi or 3G connections. For privacy and security, the Eureka Field tablet offers tabular data entry via a drop-

BB-0403 LoosenMaterial.qxd_Layout 1 1/18/13 9:22 AM Page 1

down list, hand-writing recognition or a virtual keyboard. Maptek’s latest product was designed to cater for its growing clientele in the Australian mining industry. “A few years ago, an exploration company asked us for help in viewing seismic sections,” Henderson said. “Our software was three-dimensional, although the sections were two-dimensional and they really needed to see where those sections were in 3D space. Once we solved that problem, we realised that we could bring in other types of data and this was the catalyst for developing Eureka.” Founded 31 years ago in Sydney, Maptek’s products cover exploration to production stages.

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Mining Software

Dial-a-flight A Queensland travel agency has released a mobile application for travelling miners. By Vetti Kakulas


Corporate Travel Management has released a mobile application for fly-in, fly-out miners.

risbane-based Corporate Travel Management (CTM) has released a mobile phone application for the mining industry. The CTM Mobile application is designed to assist miners with flights, accommodation, destination information and emergency communications. Miners using the application can access their itinerary and travel directions on their mobile phones at any time. CTM Mobile is compatible with iPhone, as well Blackberry, Windows and Android devices and can be downloaded for free. According to CTM general manager of marketing and communications Tom Clark the application was developed to provide clients with access to an extensive range of

travel tools in one location. “Whether it’s viewing flights, accommodation and car rental bookings, or finding directions to the local airport, it’s there at their fingertips, controlled by a user-friendly and intuitive interface,” Clark said. Key benefits of CTM Mobile include one-click access to travel details, and flight updates including delays, cancellations and gate changes. As well as allowing flight check-in, the application enables the user to view seat maps. They can select a seat prior to boarding and search for alternate flights on the same or different carriers. Miners going on vacation can use the application to find destination-specific

information, including travel directions and street maps. “CTM Mobile has been designed to ensure complete ease of use, with all travel tools available from one screen and available around the clock, wherever you’re travelling,” Clark said. “Hotel directions, meeting venues, checking your flight status or assigning your seat – all this information and much more can be readily accessed from your mobile device.” To enhance traveller safety, the CTM Mobile application can send SMS messages to the user reminding them of risk notifications and pre-trip advisory risk assessments. Miners can use the application to keep their friends, family and colleagues up-to-

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date with their trip information by sharing their itinerary through online networks such as Facebook, Twitter and LinkedIn. Additionally, Clark said, miners can easily access travel documents such as e-tickets and e-invoices using the application. The application is integrated with CTM’s online booking tool u-book and provides access to real-time itinerary information, eliminating the need to contact airlines or travel agents for flight details and updates. Miners can also view itineraries when their mobile is offline or in flight-mode. CTM said the risk notification and alert services incurred a minimal fee. In 2012, CTM launched its subsidiary Resource Travel Management to cater for its growing mining and resources client list. CTM Mobile is likely to prove interesting for miners working fly in, fly out and drive in, drive out work schedules. Studies have shown that the greatest difficulty facing FIFO and DIDO workers was spending periods away from family and partners. Any hardware or software that connects workers with home is proving increasingly popular. CTM has offices in the Gold Coast, Sydney, Melbourne, Perth and Auckland, New Zealand.


Cloud-based BECKER Mining Systems Australia has adopted web-based content management to manage project information for its mining clients. The German-founded company provides and manufacturers mechanical and electrical products for the mining industry. Becker Mining chief financial officer George Buckley said it was important to manage information flow. “There is much more collaboration needed on any given project,” he said. “We may have a project running at Moss Vale, in New South Wales, that requests heavy involvement of Newcastle staff,” he said. “So there needs to be an excellent information flow.” Becker enlisted help from business process management firm CAYLX Software and Hyland Software’s content management product OnBase. Buckley said he liked the web-based delivery of OnBase and the lower cost of ownership, compared to other alternative systems. “The mobility of the system is fantastic,” added Buckley. Becker Mining is located throughout Australia.

More arriving every week SOUTH African simulator firm 5DT has released a range of simulators for the mining industry. Recent additions to the SimCAB range include the Sandvik DD210 drill, Caterpillar AD55B articulated truck and Caterpillar R2900G load haul dump bogger. “We are literally delivering new simulated machine models every week,” 5DT chief operating officer Mario Schehle said. “We have more than 20 container-mounted simulators on our production line. “In fact, we have actually run out of storage space and have resorted to stacking the containers on top of each other just to keep up.” 5DT said it has received impressive results from its simulators, with most customers noticing a significant decrease in the training time of new operators. Anglo American Platinum human resources coordinator Evert Kleynhans said that after one week of using the training program trainees were usually competent to use the machines.


Mining Software

RPM’s Underground Coal XPAC Solution.

Underground solution African Mining Indaba was the venue for the launch of a new software package, developed exclusively for the underground coal sector. By Alison Middleton


ustralian mining software firm RungePincockMinarco has launched its first software package focusing exclusively on underground coal. The software, called Underground Coal XPAC Solution, was unveiled at the recent Mining Indaba in Cape Town, South Africa. Designed to accelerate the delivery of practical mine plans, the program was purpose built to focus on the planning intricacies exclusive to underground coal mines. The Brisbane-based firm said the software addressed coal-specific requirements that generic mine planning solutions did not take into account. With a single focus on underground coal, RPM said the software provided miners with more accurate, practical and relevant results. Underground Coal adapts to the unique circumstances of each mine, while its interface guides users through the businesscritical stages of mine planning. RPM said it had the industry’s largest installation base in underground coal mines


globally, but the firm was anticipating high demand for the product. RPM regional general manager Mike Evans said: “Our clients face risks from the traditionally complex mine planning solutions available until now, which means reliance on retaining niche technical skills. “With a skills shortage continuing to affect the industry, we’ve addressed these concerns by launching Underground Coal with in-built mining intelligence that removes the need to have these niche skills, opening up mine planning to a wider audience,” he said. “This in-built intelligence was developed from our over four decades of industry expertise. “We’re proud to have the world’s largest installation base in underground coal mines globally.” RPM said the software package was suitable for both advanced as well as novice users, and featured a grid import utility with functionality to accept data from major geological packages. It has a database that allows the user to store, interrogate and analyse large amounts

of mining information. Time usage reports interrogate data at the micro level to quantify actual downtime and utilisation, while standardised calculation methodologies for data are included to ensure consistent outputs. The package has been designed to enable users to perform sensitivity analysis and run multiple scenarios to see how output results will be affected. Evans said Australian coal miners removed the risk of loss of human capital from their business by implementing Underground Coal. The package can be purpose built for specialised commodities and mining methods, and includes a uniform framework for reporting reserves to JORC compliance codes. “With Underground Coal, we’ve eliminated the need to learn scripting, meaning less time getting the hang of the software and more time planning the mine,” he added. “Not only is it easy to become proficient, mastering Underground Coal is extremely high speed.”

MARCH 2013 amm

Online portal launched Mining technology company Maptek has launched an online portal for customers using its 3D mining software solution, Vulcan. The tool allows clients to track and manage their support cases, and search a database of frequently asked questions and solutions. Video demonstrations, tips and tricks are featured in the portal, in addition to a user’s forum to comment and share information with global peers. in addition to personal support cases, customers have access to a repository of more

than 400 solution articles. Vulcan downloads will also be accessible via the portal. The Adelaide-based company said it responded to more than 7000 support cases annually. Access to the portal is available to current Vulcan users, and information about creating accounts will be sent to customers by email, along with a secure login. Maptek global marketing director Stewart Maurer said: “We want customers to be able

to easily access information. “This is something they have asked for, and it will be an essential tool in our Maptek customer service matrix. “Simply making good software or hardware isn’t enough. it is the support we provide that sets us apart. The portal enhances the services we offer and gives customers the tools they expect.” The portal will be extended this year to include users of i-Site products, with BlastLogic and Eureka.

Machine guidance solutions AuStrALiAn distributor Position Partners has signed a deal to offer a uS software provider’s machine guidance and fleet management solutions. Position Partners, based at Campbellfield in Victoria, confirmed it would sell and support Carlson’s Machine Control software products. Carlson’s range of machine guidance solutions for mining operations includes

amm MARCH 2013

the Carlson grade program for dozers, graders, scrapers and other surface-grading machinery. Shovel grade software for excavators and shovels as well as the Drill grade solution for drilling machinery will be offered, along with the truckPro program that monitors position and load information across mining truck fleets. Carlson Machine Control division vice-

president randy noland said: “We are thrilled to be introducing our solutions through Position Partners. “Carlson and Position Partners have worked together for many years to supply the land surveying industry with software solutions, so it was natural to expand our partnership to include Carlson’s machine guidance products.”




30 April - 2 May 2013, Four Points by Sheraton, PERTH Creating opportunities and overcoming risks, for exploration & production in Africa Exploring equity and investment drivers for African mining projects Africa mining – business and operational risk mitigation Social license and community engagement in Africa - realities, pit-falls and opportunities African economic outlooks & prospects for mining Overcoming mining infrastructure limitations and development hurdles Regulatory and legislative regimes examined

Tenement insecurity and obtaining mining titles - practical solutions for explorers and producers Gaining access to geophysical and geological data Overcoming employment issues in development of mining projects in Africa Updates on legislative regimes in various African mining jurisdictions Pathways to Africa for juniors and midcaps

Pre-conference workshops: Tuesday 30 April 2013 A

Dealing with the impacts of sovereign risk in Africa mining operations


Mining infrastructure investment & development in Africa


Business risk mitigation strategies and tax implications for mining in Africa

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Brandon Munro, Namibian In-Country Manager, BANNON LIMITED

Tim Fry, Chairman, CRUCIBLE GOLD

Greg Cochran, Managing Director, DEEP YELLOW

Dr Ivor Roberts, ED, Mine Title Division, DEPARTMENT OF MINES AND PETROLEUM WA

Mark Calderwood, Managing Director, PERSEUS MINING

David Meehan, Chief Operating Officer, SUNDANCE RESOURCES

Charles Siwawa, Chief Executive Officer, BOTSWANA CHAMBER OF MINES

Bheki Sibiya, Chief Executive Officer, CHAMBER OF MINES OF SOUTH AFRICA

Toni Aubynn, Chief Executive Officer, GHANA CHAMBER OF MINES



Heath Lewis, Partner, CLAYTON UTZ

Mark Laing, Principal Mining Engineer, NOBLE MINERAL RESOURCES

Mark Wilson, Managing Director, LEGEND MINING

Gary Berson, Partner, CLAYTON UTZ Jason Brewer, Executive Director, CONTINENTAL COAL Jacques Van Rhyn, Partner, DELOITTE Mark Connelly, Chief Executive Officer, ENDEAVOUR MINING

Paul Roberts, Managing Director, PREDICTIVE DISCOVERY Michael McKevitt, Managing Director, RIFT VALLEY RESOURCES Paul Kehoe, Managing Director, SYRAH RESOURCES

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ASX Update

AMM Mining Services Index

The AMM Mining Services Index has continued to rise during the past month. It opened at 1370 points, slowly rose during the period and ended at 1520. The chart above – developed exclusively for AMM by – illustrates a market-weighted index of 16 ASX-listed mining service companies, with prices adjusted for float and corporate events. The index is based to 1000 on January 1, 2005.


DECEMBER 21, 2012

Coventry Resources Inc

Code: CYY Principal activities: Gold exploration Opening price: 0c


FEBRUARY 28, 2013

Coke Resources Limited

Proposed code: CKE Principal activity: Coal exploration Issue price: 20c Corporate: James Carter (non-executive chairman); Claude Strnadica (executive director); Les Pereira (non-executive director); Rafael Nitiyudo (non-executive director); Simon Penney (company secretary) 08 6336 6400

MARCH 28, 2013

Torque Mining Limited

Proposed code: TQE Principal activity: Gold exploration and development Issue price: 20c Corporate: Peter McNeil (non-executive chairman); Graham Fish (non-executive director); Jay Stevenson (non-executive director); Bob McNeil (managing director); Lisa Hartin (chief financial officer and company secretary) 07 5564 8823


Gossan Hill Gold Limited Kin Mining NL Perpetual Resources Limited SolGold PLC Listings updated as of February 13

amm MARCH 2013


MARKET watch Graphite run

China continues to “tighten its grip” on graphite.


nticipated growth in both traditional and emerging markets is inspiring a number of new exploration and development

projects. This is especially the case for the in-demand flak graphite, in countries like Australia, Brazil, Canada, Sweden and parts of Africa. Metals and minerals researchers Roskill reported last year that world production of natural graphite was increasing as Chinese amorphous mines come back online following government closures and consolidation since late 2010. They reported that China was by far the world’s largest producer of natural graphite, accounting for around 70% of

global production and 60% of exports. However, it is also the largest consumer and is expected to continue to “tighten its grip” on domestic production and exports in order to conserve resources and increase downstream processing. Craig Rugless is executive technical director for Australian exploration firm Lamboo Resources, which has been granted mining rights over the historic abandoned Samcheok graphite mine in South Korea. He said: “The amount of graphite used in lithium batteries is usually between 10-30 times that of the lithium used. So with an increase in the amount of lithium batteries being used, we see an increased availability of graphite.”

Silver follows gold SILVER was BHP Billiton’s saving grace over the past two years, as the company shelved its Olympic Dam expansion in South Australia. Yet silver is less popular to local investors than gold. The irony is that the silver price has historically ridden on the back of gold, and with the gold price where it is and its future projections, silver’s future looks rosy too. Patersons Securities resources analyst Tim McCormack said history has shown there is money to be made in silver, as the margins are there to support a profitable business. There are not many silver producers around – especially pure silver producers. It mostly appears as a by-product from lead-zinc operations. • Anthony Barich is editor of RESOURCESTOCKS magazine



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Mining Brief

PPE in pink It seems like pink is the new yellow for one of BHP Billiton’s mining contractors. By Vetti Kakulas Miners from Cannington mine wearing pink work wear.


ining contractor Redpath Australia has unveiled its first pink excavator and workwear clothing to raise awareness of

breast cancer. Redpath is a Canadian company with Australian operations in Brisbane and Perth. The bright pink additions will be used at BHP Billiton’s Cannington mine, 200km southeast of Mt Isa, in Queensland, to raise funds for researching the disease. Redpath and BHP Billiton have formed a partnership with the National Breast Cancer Foundation. This year, Redpath promises to donate $10 for every hour the pink excavator is operating at the silver mine. BHP Billiton has contributed $10,000 to the

initiative. Cannington mining superintendent Shane Johnson said he saw the initiative as a great way to promote awareness of breast cancer and the importance of researching to find a cure. “It’s initiatives such as this that provide an opportunity to promote health and community-based legacy projects in the local region,” Johnson said. “Hopefully, the initiative will reach far and wide and make a real difference where it’s needed most.” The Cannington miners have been encouraged to support the cause; every worker who donates $50 will be given a pink hard hat and work shirt. Redpath Australia’s marketing manager Rhiannon Vines said she was impressed


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with the response. “Initially, we weren’t sure how enthusiastic our workers would be about wearing bright pink to work, but they have been incredibly supportive, with many getting involved,” Vines said. Around one in eight Australian women will be directly affected by breast cancer and an average of seven die of breast cancer every day. “We believe research is the most effective way to reduce the impact of breast cancer and, eventually, eradicate it altogether,” National Breast Cancer chief executive officer Carole Renouf said. “We’re delighted the mining sector recognises the importance of funding further research.”


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Mining Brief

Handed to Holland Firm lands $186 million contract to deliver Cape Lambert Port B wharf extension. By Hanna Vickers


ohn Holland Group, a wholly owned subsidiary of Leighton Holdings, has been awarded a $A186 million contract to deliver the Cape Lambert Port B – Wharf Extension project for Rio Tinto Iron Ore. The project will extend the wharf currently being constructed to provide an additional two berths at Rio’s Cape Lambert Port B, as part of its announced expansion to 353 million tonnes annual capacity. John Holland is already working on the first phase of the project, with executive general manager of energy and resources Brendan Petersen saying the contract will reinforce the company’s presence on major port expansion projects in Queensland and Western Australia. “Our project team is currently on site

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John Holland says work on the 920m jetty is progressing well.

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“Our project team is currently on site delivering the first stage of the project, so this award builds on the existing work at Cape Lambert and most importantly our ongoing relationship with Rio Tinto.” – Brendan Petersen delivering the first stage of the project, so this award builds on the existing work at Cape Lambert and most importantly our ongoing relationship with Rio Tinto,” he said. Managing director Glenn Palin said the contract recognised the work already done by the company in this field. “We believe that John Holland’s strong track record in the successful delivery of major wharf projects in the resources sector would have been a major contributor to this award,” he said. Palin said the John Holland project team worked closely with Leighton Asia to pull together a smart modularisation, procurement and logistics solution. The company is particularly excited about the success it is having with its local community and indigenous engagement programs in the Pilbara. “There are currently 22 indigenous workforce members working on Cape Lambert, representing 6% of the total workforce, which we aim to increase yet further with this additional scope,” Petersen said.

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John Holland began in October 2010 constructing the marine package of Cape Lambert Port B – a 920m approach jetty and a new wharf about 860m long. Construction time for the total project was reduced by moving several work-fronts for the wharf almost 1km out to sea, more than a year before they could be connected to shore by the approach jetty. Just over a year later, the approach jetty and wharf were connected, a major milestone on the way to completion of the new Port B facility in 2014. The occasion was marked on November 26 with a ribbon-cutting ceremony attended by John Holland’s employees and contractors on the project. The new port is part of Rio Tinto’s $20 billion program to expand mining and exports from its Pilbara iron ore operations by 50% to 360 million tonnes per annum by 2015. • A version of this story first appeared on

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What’s New

Best protection Sandvik Mining promises the fastest tramp iron protection system for cone crushers. By Vetti Kakulas Sandvik Mining’s latest electric dump valve system.


quipment giant Sandvik Mining has released its latest electric dump valve system for the CH800 series crusher range. The mining industry has been promised that the product is the fastest tramp iron protection system for any cone crusher on the market. The dump valve system samples hydraulic pressure 200 times per second, while its hydraulic control system reacts instantly to uncrushable objects in the crushing chamber. Uncrushable objects include tramp iron, drill bits, mill balls, excavator teeth or pieces of steel “Customers who have already installed the electric dump valve have seen significant improvements in the protection efficiency,” A101809 AEL IRON 182x124 fa.pdf



said Sandvik market support manager, crushing and screening, Marcus Benn. “The service life of structural components, bearings and liners has increased significantly due to the reduced exposure to pressure peaks.” Sandvik’s Hydroset system design, incorporating the electric dump valve, promises instant detection and reaction to uncrushable objects and decreases the risk of internal damage to the crusher. Mining companies have been told that the system reduces exposure to damaging pressure peaks by more than 90%. “Judging by customer feedback and firm orders already received, we see that the electric dump valve clearly provides value to our customers and gives them peace of mind,” said Benn.


3:12 PM

Other benefits include an output signal from the programmable control system, which notifies the operator when the crushing chamber is opening. The notification can inform the operator of potential corrective actions to remove unwanted materials from the process. An external dump valve, located on the side of the crusher, is fitted to increase safety and ensure easier access during maintenance. Electric dump valve kits are available for Sandvik crusher models CH870, CH890 and CH895. A retrofit kit is also available for crushers covering the H7800, CH870, H8000, H8000i, H8800 and CH880 models.

MARCH 2013 amm

Safely stored

Huski ladies SAFETY and workwear designer Huski Explorer has introduced its first range of ladies high-visibility jackets for miners. Based in Melbourne, Victoria, Huski specialises in soft-shell, anti-static, flame retardant and arc-rated jackets. Huski spokesman Mark Kessel said his company continues to develop and improve its clothing fabrics. “Huski’s latest ladies garments are designed specifically for miners, including highvisibility, cotton backed polos, through to top-of-the-range waterproof, breathable, multi-function apparel,” Kessel said. Available in sizes 8-20, the range was designed “by women for women”, said Kessel. The collection includes the “lightweight” Nimbus, which is waterproof and seam sealed, the Kimberly soft-shell jacket and the heavy duty waterproof Opal. Described as versatile, the Opal range has zip-off sleeves which transform the jacket into a vest. Huski has developed safety clothing for Australian miners since 1965. All of its designs have the ISO Australian Quality Assurance rating.

Huski Explorer’s Opal jacket.

Help from a Predator POWER transmission belts manufacturer Gates Australia has launched its latest V-belt to the mining industry. Gates produces heavy-duty and light-duty belts, and products for specialty drives. Although thinner than standard V-belts, the Predator V-belt has a greater kilowatt capacity and is half the width and weight.

Predator V-belt.

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It has been designed for use on metric multi-groove sheaves, deep groove sheaves and drives with limited room. Gates said the Predator can minimise overhung load, extend bearing life and reduce downtime and maintenance costs, while using a slimmer pulley. Just like the name suggests, the Predator is designed for tough, dirty and “aggressive” applications and environments. “Predator belts have the highest power density of any V-belt, and stretch dramatically less than standard construction belts,” Gates spokesperson Stephanie Papathanasiou said. “That’s why they’re ideal for use on problem drives requiring high-impact strength and load-carrying power.” Gates promised the Predator could reduce drive costs for mining companies by 35% and said that it had “zero stretch”, eliminating the need for constant belt re-tensioning. Its double fabric cover maximises abrasion resistance, which protects against wear caused by fine airborne dust and prevents rapid belt sidewall wear. Predator V-belts can also be used for construction, manufacturing, agriculture and forestry industries.

INDUSTRIAL workstations and furniture manufacturer Actisafe has released units specifically designed for the mining, resources and engineering industries. The security storage unit uses electric roller shutters to safely store its contents and has heavy-duty lockable drawers for holding ancillary items. Actisafe’s units can be used to safely store miner’s personal belongings or they can be used by companies to store valuable products. Designed with heavy-duty steel, the security storage units have a “tough” powder coated finish, providing a longer lifespan, even under harsh and extreme conditions, such as those found on a minesite. Since the units have a standardised configuration, they can be placed sideby-side for space efficiency. The security storage units can be placed flat on the floor, Actisafe can provide legs or rollers, or the units can be placed on pallets or skids. Actisafe’s security storage units are available in a range of colours for those companies wishing to colour-code their range. Based in Singleton, New South Wales, Actisafe also makes a range of other safety-related products, including emergency showers and eyewashes, flammable or corrosive storage cabinets, and wheel chocks.

Actisafe’s security storage unit.


What’s New

Next stop: Australia MINE scrapers manufactured by Canadian company K-Tec have been launched on to the Australian mining market. The company has revealed a Mine Version 33 cubic yard scraper for removing overburden. K-Tec said the 1233ADT scraper provided the mining sector with a rugged and durable solution for moving materials such as rock and gypsum. The Mine Version scraper was adapted from a construction machine and has thicker, high-tensile plate steel, enabling top-loading of heavier rocks in mining environments. It also benefits from a “gooseneck”, which hooks up to the frame of articulated dump truck power-units to provide higher speeds on haul roads while ensuring precision grading and dumping. The machines are shipped through K-Tec’s authorised Australian dealer, Access Import Services, which is based in Dalby, Queensland. A K-Tec 1453 scraper is already working in a Queensland mine, while Access currently has two 1233ADT scrapers being shipped to Australia. A spokesman for the Manitoba-based firm said K-Tec Earthmovers was already well-established in the construction equipment market. “The natural expansion into the mining sector for K-Tec was spurred on by increasing customer inquiries in rock applications,” he said. “Altering the design of the popular 1233 model was possible with the assistance of 3D computer-aided design and stress testing computer

A K-Tec scraper at a US gypsum mine.

programs to provide the basis for a prototype mining unit. “The scraper design was further refined and “rock-proofed” after a period of onsite research and development testing. “K-Tec recognises the importance of being able to meet and exceed the stringent equipment standards and expectations of the mining industry.” The bolt-together design of the K-Tec 1233ADT Mine Version scraper allows for overseas shipping.

Your vantage point Australia’s Mining Monthly provides you with essential industry news, from high-profile surveys and in-depth reports, to the latest in mining issues and technical trends.


Subscribe online today! For advertising opportunities, call us on +61 8 6263 9100 or email


Companies & organisations in this issue

Explosive app DYNO Nobel has launched an explosives engineers’ mobile application for iPhone or Android devices. The Brisbane-based company designed the app to equip users with a full range of blasting tools that help optimise blasting in the field. The explosives engineers’ mobile app provides seven critical blasting calculators, access to Dyno Nobel’s technical library, and comprehensive product information, including product specs and application uses. Users can also receive real-time updates that feature Dyno Nobel news,

recent innovations and new videos. It also has worldwide remote accessibility to the app to address minesite difficulties connecting to mobile services. Dyno Nobel marketing analyst Dan Housley said: “The explosives engineers’ mobile app is a simple and free solution that gives current and potential customers ‘on-the-go’ access to a broad pool of information, unit conversions and blast design terminology. “It offers the full breadth of blasting knowledge at the tip of their fingers,” he added.



Action Drill & Blast




Australian Centre for Geomechanics 41 Australian Minerals and Mining Group


Beasley Intercultural


Becker Mining Systems Australia BHP Billiton


67, 104, 105

Boart Longyear


Chamber of Minerals and Energy of Western Australia 47, 93 Critical Materials Initiative


Crushing and Mining Equipment


Deep Yellow Dyno Nobel

22 79, 111

Environmental Systems & Services


Focus Minerals


Fortescue Metals Group Gates Australia Dyno’s explosives engineers’ mobile app.

Hays Huski Explorer

89 18 28


14 110

LeTourneau Technologies Maptek

16 12 97, 101

Newcrest Mining


New Hope Group


NSW Minerals Council

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K-Tec Leasecorp

Poseidon Ltd Position Partners Rainstorm

SSAB business development market developer Claes Löwgren said: “The mining industry is an important and expanding market for the thicker grades. “The trend for mining machines is larger, in order to increase efficiency. It is important that there is also Hardox in thicker versions that can keep up with this size development. “Right now, we are developing Hardox with thicknesses up to 160mm.” The Swedish company ships steel from its Scandinavian steelworks to Shanghai in China for processing, before delivery to customers in Australia.

92 109

Inmarsat Keech Australia

STEEL manufacturer SSAB has expanded its range of Hardox wear plates to provide miners with thinner versions of the steel. SSAB said the move to cover thicknesses from 0.7mm to 130mm would provide new opportunities for existing customers to develop their products. Hardox wear-resistant steel is used for the manufacture of liner plates, hammer mills, crushers, feeders and to line conveyor belts in materials handling. Expanding the size of steel means mining truck beds could be made lighter by using thinner sheet with the same lifetime, while equipment could be manufactured lighter and more durable.

6 109

Industrial Foundation for Accident Prevention John Holland Group

Steel yourself



Redpath Australia Rockwell Automation RungePincockMinarco Rio Tinto Sandvik Mining

14, 91 44 101 82 74, 105 93 100 50, 106, 112 77, 93, 108

Sheffield Resources


Split Set Mining Systems






Venturex Resources




Vital Chemical





Another write off?

Sam Walsh has some big decisions ahead of him, as he takes up the reigns of global mining house Rio Tinto.


am Walsh had every reason to smile last month at the hand fate has dealt him, though Dryblower wonders whether the jovial Rio Tinto chief executive will look as happy in the next year or so as he tries to make business sense of the problems he has inherited. A lousy coal deal in Mozambique which cost his predecessor, Tom Albanese, the top job at the world’s second biggest mining house is the first task requiring Walsh’s attention – and perhaps the easiest. All the former head of Rio Tinto’s iron ore division has to do is find a partner for the proposed coal development, strike a deal with other coal miners in the country to build a decent railway to the coast, or he could just cut and run. Abandoning the Benga and Zambeze coal assets which have already been heavily written down would be easy, blaming outgoing management. That’s part of the fun in being the new boy in charge. The problem with a write-off, and the assignment of the blame to people who have left the company, is that you can only do it once, safely. Too many write-offs, and too much blame re-allocation, and investors might start to think that you’re not up to the job. That’s why Walsh might be wise to plug ahead with the Mozambique coal project for a little longer, without trying too hard and without investing too much capital, because he might need to play the “it happened before my time card” with Rio Tinto’s other troubled projects, iron ore in Guinea and copper in Mongolia. Simandou, the big iron ore deposit which has been passed around like a stolen watch in a smoke-filled pub by a series of corrupt governments in Guinea, is showing few signs of ever being more than a remote hill somewhere up-country in that godforsaken west African dump. To give it credit, Rio Tinto was first on the scene almost 20 years ago, only to run afoul of the country’s dictator, Lansa Conte, who hand-balled it to interests associated with an

Leading role: Rio Tinto’s Sam Walsh has his work cut out.

Israeli diamond merchant, Benny Steinmetz, who promptly executed the deal of the decade. Less than two years after getting his hands on Simandou, and after spending about $US160 million on extra field work, Steinmetz sold 51% of Simandou to Brazil’s iron ore giant Vale for an astonishing $US2.5 billion, with $US500 million paid immediately, and the rest to come later. By late 2009, a new dictator took control of Guinea, Moussa Camara, who led a massacre of civilians and was himself shot in the head by his aide-de-camp. The new man in charge of Guinea, Alpha Conde, is said to be trying to clean the Guinean stables, striking a new deal with Rio Tinto (for a cash payment of $US700 million, thank you). Vale has been reduced to sideline observer status and Steinmetz says he’ll sue. Meanwhile, at Simandou itself not much is happening though it is an asset very close to the heart (and career) of Walsh who will be wondering how much more of Rio Tinto’s scarce capital he should send off to Guinea,

if any at all. Mongolia, another third-world country which seems to have been heavily favoured by Rio Tinto over the past decade, is also shaping as a crisis zone, not so much because of the company’s flagship copper project, Oyu Tolgoi, but more because the country has almost bankrupted itself. At first glance the financial troubles of a country might seem far removed from the desk of the Rio Tinto chief executive, until you probe a little deeper to discover that Mongolia might soon be asking Walsh for a helping hand in the form of a tax increase, or an extra slice of Oyu Tolgoi. What’s happened in Mongolia is either a marvellous example of fact being stranger than fiction, or from a management text book titled “Never let the government run a business”. Two years ago the government of Mongolia thought it would be smart politics to issue every citizen 1072 shares in a big coal project called Tavan Tolgoi as part of a campaign to spread the wealth. Last June, as a vote-buying exercise before an election, it offered to buy back the shares at a fixed price of $US760, a whopping price which is the equivalent to 25% of the average Mongolian’s annual income. The problem was that the $US1 billion in cash for the buyback was extracted from Tavan Tolgoi, which now lacks the capital to finish developing the mine, and has broken a contract to deliver coal to its biggest customer in China, Chalco. What now? Well, according to some suggestions, the solution is to change the law governing mineral ownership in Mongolia, transferring 34% of all licences to the government. This proposal might just be the thin-edge of a Mongolian wedge. For 63 year-old Walsh, who is well-trained in handling far simpler problems in the benign jurisdictions of Australia and Canada, the prospect of fighting corporate forest fires in Mozambique, Guinea and Mongolia is hardly a joyful way to see out the final years of his career.

“Always forgive your enemies. Nothing annoys them so much.” – oscar wilde 112

MARCH 2013 amm

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Australia's Mining Monthly - March 2013  

Australia’s Mining Monthly interviews Fortescue Metals Group chief executive Nev Power, Mining and Equipment, communications and technology...

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