Australian Resources & Investment Vol 15, Number 1 2021

VOLUME 15 NUMBER 1 | 2021

Australian Resources & Investment BATTERY METALS BOUNCE BACK

ELECTRIFYING AUSTRALIA’S FUTURE MINES

NICKEL’S NEXT OPPORTUNITIES TAKE SHAPE

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for Australian mining

IMPROVING HOW COPPER IS RECOVERED

COMMENT

AUSTRALIAN RESOURCES & INVESTMENT

Commodity strengths drive the future of mining BEN CREAGH Ben.Creagh@primecreative.com.au

I

Australian Resources & Investment is set for a new era following its acquisition by Prime Creative Media.

t is with great excitement that Prime Creative Media takes over Australian Resources & Investment (AR&I) from Executive Media with the publication celebrating its 15th anniversary.

The acquisition comes at a time of prosperity for the resources industry, with the mining sector again proving to be the driving force of the Australian economy.

Surging commodity prices have set the foundation for this position. As we go to print, iron ore prices are in record territory and Australia’s producers are taking advantage by increasing production.

The gold sector has also come off a year of record prices in Australian dollar terms, providing producers and explorers of the precious metal with a buoyancy not seen in years.

Following the impact of the COVID-19 pandemic, the industry is also enjoying a resurgence in prices for several base and battery metals.

Copper, for example, has hit all-time highs above $US10,000/tonne as expectations for a spike in demand during the next decade grow. Then there’s lithium, which has recovered significantly over the first half of 2021 following an 18-month slump that heavily affected the industry in Australia.

In each of these commodities, Australia’s mining sector is in an enviable position with its large resources to benefit from the healthy prices that have emerged.

Production of iron ore and gold, in particular, is peaking. Australia, as the world’s leading producer, is expected to export a record $136 billion worth of iron ore in 2020-21, a significant increase on the current record of $103 billion set in 2019-20.

Australia is also on track to become the world’s top producer of gold, with forecasters predicting we will overtake China in the lead as soon as this year.

This move up the rankings was reflected in the record 327 tonnes of gold that Australian miners produced in 2020 despite the challenges of the COVID-19 pandemic.

The dynamic marketplace has also created promising conditions for Australia’s exploration sector across these commodities and others, particular those now classified as critical minerals.

In 2019, exploration expenditure increased by 21 per cent on the previous year to $2.6 billion, its highest point since 2012. More than $1 billion of this figure was spent on gold exploration.

The exploration sector will remain a key focus for AR&I under its new ownership. We intend to support the junior miners that are setting up the future of the industry in Australia by offering them extensive coverage.

AR&I will also continue to deliver expert analysis of the broader mining industry, as well as the latest trends in the commodity markets.

We look forward to taking AR&I into this new era to support the ongoing growth of the Australian resources industry.

CHIEF EXECUTIVE OFFICER JOHN MURPHY PUBLISHER CHRISTINE CLANCY MANAGING EDITOR BEN CREAGH Tel: (03) 9690 8766 Email: ben.creagh@primecreative.com.au CLIENT SUCCESS MANAGER JUSTINE NARDONE Tel: (03) 9690 8766 Email: justine.nardone@primecreative.com.au SALES MANAGER JONATHAN DUCKETT Mob: 0498 091 027 Email: jonathan.duckett@primecreative.com.au BUSINESS DEVELOPMENT MANAGER ROB O’BRYAN Mob: 0411 067 795 Email: rob.obryan@primecreative.com.au SALES ADMINISTRATOR EMMA JAMES Tel: (02) 9439 7227 Mob: 0414 217 190 Email: emma.james@primecreative.com.au DESIGN PRODUCTION MANAGER MICHELLE WESTON michelle.weston@primecreative.com.au ART DIRECTOR BLAKE STOREY blake.storey@primecreative.com.au GRAPHIC DESIGNERS KERRY PERT, MADELINE MCCARTY SUBSCRIPTION RATES Australia (surface mail) $120.00 (incl GST) Overseas A$149.00 For subscriptions enquiries please contact (03) 9690 8766 subscriptions@primecreative.com.au PRIME CREATIVE MEDIA 11-15 Buckhurst St, South Melbourne, VIC 3205, Australia www.primecreative.com.au © Copyright Prime Creative Media, 2016 All rights reserved. No part of the publication may be reproduced or copied in any form or by any means without the written permission of the ­publisher.

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Ben Creagh Managing Editor W W W. A U S T R A L I A N R E S O U R C E S A N D I N V E S T M E N T. C O M . A U

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CONTENTS

I N T H I S I S SU E T H E F E AT H E R S T O N E R E P O R T

6 Resources IPOs are back in fashion in 2021

F E AT U R E D

10 Analysis with Regina Meani 12 M&A deals that build investor trust 14 The ethical considerations of AI in mining

32

GOLD

20 Newcrest answers mining’s challenges

22 Reducing the carbon footprint of gold operations

24 Strong prices lead to a surge in Australian activity

26 Wiluna aims to transform gold site

NICKEL

MINE DE VELOPMENT

44 St George discovery lifts

60 Blockchain platform guides

46 Poseidon to benefit from

62 Why investors are targeting

Mt Alexander outlook

nickel demand

responsible sourcing

a greener mining industry

48 Metal additive manufacturing and nickel

MINING SERVICES

64 Benefits of hot dip galvanizing in the resources industry.

COPPER- GOLD

28 Dart plots Victorian exploration breakthrough

29 Thor builds momentum in

B A S E M E TA L S

50 Project pipeline puts Rumble in position

TUNGSTEN

65 Breathing life into the

SA and WA

Mt Carbine mine

MINERAL SANDS

52 Mozambique opportunity B AT T E R Y M E TA L S

30 Roskill outlines Australia’s

emerges for MRG

SILICA

66 A commodity of the future

new mineral dawn

32 Altech’s game-changing tech for battery market

emerges as demand grows

INDUSTRY TRAINING

54 UQ leads change in resources sector

34 Adrian Griffin highlights a shift in

FOLLOW THE LEADERS

68 The latest executive moves

focus for lithium-ion batteries

38 Market dynamics move in a positive direction

COPPER

56 Securing the future of WA’s copper mining industry

40 Mining collaborates to electrify

EVENT

70 What’s coming up in the

the industry

42 Government builds focus on critical minerals supply

–4–

in the mining sector

D I G I TA L M I N I N G

58 VEGA helps Pilbara mine overcome water level hurdle

resources industry?

Mining engineering is changing. And so are we.

As the resources industry faces new challenges associated with environmental and social governance, as it embraces new technologies, and as it sustains and improves its existing practices, there is an ongoing imperative to recruit graduate engineers with necessary knowledge and skills to support change. UQ is changing how we deliver mining engineering education to meet these needs.

Following an extensive review of the current program in 2018 – 2019 followed by industry consultation through 2020, we are excited to announce our new approach to mining and resources engineering education.

mechmining.uq.edu.au CRICOS Provider 00025B

T H E F E AT H E R S T O N E R E P O R T

THE

Featherstone REPORT

MINING IPOS QUICK OUT OF THE BLOCKS

BY TONY FEATHER STONE

Resource-sector floats begin the year strongly on the back of higher commodity prices and improving global growth.

Tony Featherstone is a former managing editor of BRW, Shares and Personal Investor magazines. The information in this article should not be considered personal advice. It has been prepared without considering your objectives, financial situation or needs. Before acting on information in this article consider its appropriateness and accuracy regarding your objectives, financial situation and needs.

Do further research of your own and/or seek personal financial advice from a licensed adviser before making any financial or investment decisions based on this article. IPO information can change quickly if companies do not raise their minimum subscription or attract enough shareholders to meet ASX Listing Rules.

All prices and analysis at April 29, 2021.

–6–

T

he recovery in mining floats has gone up a gear as more resource companies take advantage of buoyant sharemarket conditions to raise capital and list on the ASX. Fifteen initial public offerings (IPOs) in mining and energy have closed so far this calendar year (to endApril 2021). That’s almost half of all IPOs on the ASX. As Australian Resources & Investment (AR&I) went to press, another 18 resource companies had live IPOs, according to AR&I analysis of ASX admissions data.

This year’s strong start for mining floats follows 24 resource-sector IPOs in 2020 that raised up to a combined $190 million in a difficult funding market.

The median share-price gain (over the issue price) from resource IPOs from 2020 is 23 per cent (at endApril 2021). Remarkably, only six mining IPOs from last year have lost investors money (see table).

Three factors are driving the mining resources recovery. The first is the collective performance of resource shares, underpinned by higher commodity prices and improving global growth.

The S&P/ASX 200 Resources Index, a barometer of 38 materials and energy stocks on the ASX, returned 42 per cent over one year to end-April 2021, outperforming the broader market.

Second, the Australian sharemarket had a stronger recovery after crashing in March 2020 amid COVID-19 fears. The S&P/ASX 200 Accumulation Index is up almost 33 per cent over one year.

A sharemarket rally typically unleashes a wave of IPO activity because cashed-up investors are more likely to back new listings and speculative companies.

That helps mining explorers.

Third, expectation of a strong rebound in global economic growth – and continuing high commodity prices – is an ideal backdrop for mining floats.

In early April, the International Monetary Fund (IMF) upgraded its global economic growth forecast for the second time in three months. The IMF now predicts the world economy will expand by 6 per cent in 2021.

Expectations of higher global growth are boosting commodity prices. The Reserve Bank Index of Commodity Prices was up 28 per cent over the year to end-March 2021 (based on the currencies of five major industrial countries). Higher commodity prices are a boon for mining floats.

If global growth continues to surprise on the upside, and commodities remain elevated, activity in mining IPOs could boom in 2021. There is significant pent-up demand for resource floats after years of low float volumes and a stagnant IPO market.

That does not suggest capital-raising conditions are easy for resource IPO hopefuls or that all floats are achieving their minimum subscription or a sufficient spread of shareholders to meet ASX Listing Rules requirements. But mining IPO conditions are the best in at least five years.

A noticeable feature of resource IPO activity in the past 18 months has been companies raising a larger amount of capital – a sign of improving investor demand for resource-sector offerings.

RESOURCE LISTINGS IN 2021 Torrens Mining kicked off this year’s resource IPO market with its listing in early January. Torrens sought up to $10 million to develop its Mount Piper and Club Terrace projects in its Victorian gold portfolio.

Both projects are in areas with promising historic exploration.

Australian Gold and Copper (AGC), another January listing, sought $7-$10 million. AGC will hold three projects in the Central Lachlan Fold Belt in New South

AUSTRALIAN RESOURCES & INVESTMENT

Resources sector companies have dominated the IPO market on the ASX in 2021.

Wales. The company says its portfolio has multiple near-term discovery opportunites.

Early exploration results have been promising.

OzAurum Resources listed in February after seeking up to $18 million through an IPO. Sponsored by Canaccord Genuity, OzAurum is developing two gold projects in Western Australian-based tenements assembled over three decades.

Among other floats, Auric Mining successfully listed in February after its $6.5 million IPO. Auric had agreements to acquire a portfolio of prospective gold exploration and development projects in the Widgiemooltha and Norseman regions of WA. The company’s share price rallied in late March after promising exploration results.

DDH1 Limited was by far the market’s largest mining IPO with its $150 million listing in March 2021. Launched in 2006, DDH1 says it provides drilling technologies to obtain spatially accurate representative

geological information. DDH1 has a fleet of 961 mineral drilling rigs.

Genmin, another larger mining IPO, sought $20-$30 million and listed on the ASX in March. Genmin is a central West Africanfocused iron ore explorer with projects in the Republic of Gabon. Genmin is also one of few Africa-focused mining IPOs on the ASX in recent years.

Bastion Minerals sought $5-$6 million to identify high-quality precious- and base-metal projects in the mineral-rich mining regions of the Coastal Cordillera in the Atacama region of northern Chile. The Coastal Cordillera region is host to multiple world-class gold projects (including the Maricunga Belt) and copper deposits. Bastion listed on the ASX in March.

Elsewhere, Tulla Resources sought $78 million in its IPO and listed on the ASX in March. Tulla continued the run of mining floats raising larger amounts in 2021.

Tulla’s key asset is a half-interest in the

Central Norseman gold project, a historical gold mine located near the town of Norseman in the Goldfields of WA that has produced over 5.5 million ounces of gold since operations began in 1935. The other halfinterest in the project is held by ASX-listed Pantoro. It acquired that interest from Tulla Resources via a farm in and joint-venture agreement.

Firebird Metals, an April listing, sought up to $5.5 million in its IPO to develop the Oakover project, about 90 kilometres east of Newman in WA’s East Pilbara Manganese Province. Oakover comprises one granted exploration licence and two exploration applications.

In gold exploration, Medallion Metals sought $12.5 million in its April IPO. Medallion’s Ravensthorpe gold project and Jerdacuttup project are in the Southern Goldfields-Esperance region of WA, approximately 550 kilometres southeast of Perth.

–7–

T H E F E AT H E R S T O N E R E P O R T

SELECTED RESOURCE IPOS ON ASX IN 2020* C O M PA N Y

ASX CODE

L I S T I N G DAT E

C A P I TA L SOUGHT ($ M) * *

ISSUE PRICE (C E N T S)

RECENT PRICE (C E N T S) * * *

CHANGE OV E R ISSUE P R I C E (%)

Caspin Resources

CPN

Wed, 25 Nov 2020

6

20

69

245%

Desert Metals

DM1

Fri, 18 Dec 2020

5

20

55

175%

Dynamic Drill and Blast Holdings

DDB

Thu, 6 Aug 2020

5

20

45

125%

Manuka Resources

MKR

Tue, 14 Jul 2020

7

20

43

115%

Native Mineral Resources Holdings

NMR

Mon, 16 Nov 2020

4

20

30

50%

Duke Exploration

DEX

Tue, 10 Nov 2020

8

25

37.5

50%

AKORA Resources

AKO

Tue, 15 Dec 2020

4

25

36.5

46%

Castile Resources

CST

Fri, 14 Feb 2020

20

20

29

45%

Rincon Resources

RCR

Mon, 21 Dec 2020

5

20

27.5

38%

Aurumin

AUN

Wed, 9 Dec 2020

7

20

27.5

38%

Coda Minerals

COD

Wed, 28 Oct 2020

7

30

38.5

28%

Siren Gold

SNG

Wed, 7 Oct 2020

10

25

31.5

26%

Pathfinder Resources

PF1

Wed, 4 Nov 2020

5

20

24

20%

Metal Hawk

MHK

Thu, 19 Nov 2020

6

20

24

20%

Kingfisher Mining

KFM

Fri, 11 Dec 2020

6

20

24

20%

Miramar Resources

M2R

Thu, 22 Oct 2020

5

20

23

15%

BPM Minerals

BPM

Wed, 30 Dec 2020

5

20

22

10%

Westar Resources

WSR

Thu, 17 Dec 2020

5

20

21.5

8%

Megado Gold

MEG

Tue, 27 Oct 2020

5

20

18

-10%

WA Kaolin

WAK

Thu, 26 Nov 2020

22

20

18

-10%

Cobre

CBE

Fri, 31 Jan 2020

10

20

17

-15%

North Stawell Minerals

NSM

Thu, 24 Sep 2020

20

50

37.5

-25%

Pan Asia Metals

PAM

Thu, 8 Oct 2020

6

20

14.5

-28%

Montem Resources

MR1

Tue, 15 Sep 2020

8

25

10.5

-58%

Total capital sought

189.50

Median gain over issue price

23%

* Ranked by change over issue price ** Capital sought is based on maxium offer. Companies may not have achieved this amount. *** Share price at April 29, 2021 Source: ASX (for companies listings). Company prospectus for capital raised, issue price. Morningstar for recent price.

Kincora Copper sought up to $10 million to accelerate its drilling activities in up to three projects within the Lachlan Fold Belt.

High-priority drilling commenced in April 2020 and continues at Kincora’s flagship Trundle project within the Lachlan Fold Belt, yielding promising copper and gold results.

Peregine Gold, this year’s smallest mining IPO by capital raised, had a good start after seeking $2.5 million at 20 cents a share.

Peregine had the right to acquire the Pilbara gold project, an early-stage exploration project in WA’s famed Pilbara region.

BEST PERFORMERS FROM 2020 Caspin Resources topped last year’s resource IPO rankings. After listing in late November 2020, its 20-cent shares raced to 69 cents by end-April 2021.

Caspin sought up to $6 million to develop the Yarawindah Brook and Mount Squires projects in WA. Caspin was spun out of Cassini Resources.

–8–

Desert Metals also starred. After listing a week before Christmas at 20 cents a share, it shot to 74 cents before easing to 55 cents by late April.

Desert Metals sought $5 million to develop its wholly-owned package of exploration licences on the north-west margin of the Yilgarn Craton of WA. Dynamic Drill and Blast Holdings (DDB) was another IPO standout. The company services the civil and mining industries from full-production drilling to specialty blasting.

DDB sought $5 million in an August 2020 IPO and its 20-cent shares raced to 45 cents by end-April 2021. The company announced two new contracts with mining, as well as contract extensions.

Among other floats, Siren Gold, an October listing, rallied from a 25-cent issue price to 31 cents by January 2021. Siren was among the larger resource IPOs in 2020 with a $10 million offer.

Underwritten by Morgans Corporate,

Siren has the Reefton gold project on the South Island of New Zealand, which has been explored and mined for hard-rock and alluvial gold since the discovery of gold there in 1870.

Soon after listing, Siren announced promising exploration results at its Alexander River and Big River tenements, within the Reefton gold project.

Manuka Resources was another top IPO performer by share-price gains since listing.

Its 20-cent shares traded at 43 cents at end-April 2021 after the company sought $7 million at 20 cents a share through a float in July 2020.

Manuka owns the Wonawinta silver and Mt Boppy gold projects in NSW. Wonawinta has a 50.9-million-ounce silver mineral resource that complies with the Joint Ore Reserves Committee Code (JORC). Manuka says it is set to become Australia’s largest primary silver producer, commencing in third-quarter 2021.

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F E AT U R E D

— ANALYSIS — WITH REGINA MEANI The gold defensive

Gold prices have enjoyed strong growth since 2019.

IN TIMES OF GLOBAL economic uncertainty, our focus becomes defensive and what better avenue of defence than gold.

For gold investors and for our Australian gold companies the price for gold in US dollars is important as a benchmark, but for many the price for gold in Australian dollars is more pertinent.

In the supporting graphs, we look at gold in US dollars and then in Australian dollars and the correlation with the Australian/ United States dollar rate (AUDUSD).

The gold price has produced some amazing bull runs. If we look back 100 years, we find that the price boomed from 1920 to 1934 and then from 1970 to 1974, from 1976 to 1980 and more recently from 2001 until 2011.

The price bottomed in 2015 pushing sideways until a new upswing was instigated in 2019; is this part of the next major bull run?

As at the end of April this year, the Comex Spot Gold price, then $US1767, was in a tenuous position.

From the longer-term perspective the price had been in uptrend since 2019, but in reaching towards $US1800 in late April it approached the shorter-term downtrend line drawn from the August 2020 high at $US2074.

The price became wedged between support around $US1750 and resistance at $US1800, and an upper trigger level was set at $US1850.

When the price clears this level, it would mean a break of the

– 10 –

shorter-term downward path and instigate a new influence over the price.

The new influence is not necessarily an immediate upswing but could incorporate more price volatility as momentum is regained.

When the upswing resumes the next main obstacle for the price is located at $US1950 where another rebuff or pause action is likely to occur before the price can break away higher towards the major barrier located at $US2000. The price only stayed above $US2000 for four days in August 2020.

AUSTRALIAN RESOURCES & INVESTMENT

If this is part of the next major bull run for gold then we can expect that the price may experience some significant breathers along the way.

Similarities to the action experienced in August-October 2008 and May-July 2012 suggest that there is likely to be some forward and backward volatility as the trend develops.

Over the short to medium term the penetration of the key support levels around $US1750 would return the price to the downward path with a further fall through $US1670 jeopardising the path to recovery.

Turning our focus to the Australian dollar price for gold of $2284 at the start of May, we find that perhaps buoyed by the downturn in the Australian dollar against the US, the price shot to new heights in August 2020 attaining $2873.

At the time, the US dollar price for gold did not reach new highs. The Australian price became significantly overbought during the peaking process and resembled what happened with the Australian dollar/US dollar turnaround and rally in 2009.

The action saw the Australian dollar gold price declining and developing along similar lines to those from April to May 2009.

Following the peak exhaustion of 2020, the price declined to support in the $2100-$2200 range. The subsequent rally lacked momentum and faltered before reaching the $2340-$2390 resistance area, which coincides with a potential meeting zone for the downward trend line drawn from the August 2020 peak.

For a breakthrough of the barriers to be verified, the price would need to move above $2400. In this case the price would find its next hurdle at $2500 and then closer to $2600.

More insight for the Australian price for gold may be gained by

the outlook for the Australian/US dollar trend path.

When the Australian dollar pushed passed US 70 cents in 2003 it forged a major break in the long-term downtrend and set in motion a new path for the Australian dollar.

Initially, the Australian dollar rose to US 80 cents where it paused and consolidated its new trend in the US 70-80 cents range before breaking higher early in 2007 to reach US 98.50 cents in mid-2008.

Divergent momentum failed to confirm the high point with a top forming to trigger the 2008 plunge to support at 60 cents.

From here, the Australian dollar turned and began to recover into 2009 moving quickly towards and through the previous US 80-cent barrier to push towards the 2008 heights.

The Australian dollar fell short of the high levels in 2010, only achieving US 94 cents before halting, pausing and pulling back to touch close to US 80 cents for a rebound and another drive towards $US1.

Forcing through the barrier to $US1.10 proved unsustainable with the drop beneath the critical $US1 level tipping the Australian dollar into decline.

Support was located in 2015-2016 in the US 68-70 cent range and the Australian dollar recovered to once again tackle the US 80 cent area but failed to progress in late 2017 and early 2018, resuming the downward path to make a pandemic low at US 61 cents in March last year.

A spike and “V” reversal spurred a quick recovery which saw the price rapidly achieve US 70 cents and then US 74 cents, while keeping support around US 70 cents in September and October 2020.

From here, the Australian dollar tracked higher to reach US 80 cents again on February 25 this year. The subsequent pullback and sideways move have some elements of uncertainty, which suggests that the sideways churning action may continue to develop but may have the positive effect of rebuilding momentum.

A further pullback may be required into the US 70-75 cent support range ahead of completion of the sideways phase.

While uncertainty prevails an earlier return to the upswing is possible, but would be contingent on passing the US 80 cent barrier and then overcoming the downward trendline drawn from the $US1.10 peak currently met around US 85 cents.

On our comparison chart of the Australian dollar gold price against the AUDUSD, the similarities to 2009 suggest that if the Australian dollar can resume its uptrend through US 80 cents then the Australian dollar gold price is likely to benefit, but the indications allude to the fact that there may be more time required in preparation to support such a move.

– 11 –

F E AT U R E D

Investors responded positively to the Super Pit consolidation.

Building investor trust through M&A Deloitte partner, corporate finance Nicki Ivory explains how a mergers and acquisitions deal can go a long way towards strengthening investor trust.

A

mergers and acquisitions (M&A) agreement can make or break a mining company’s growth aspirations.

It is no secret that a decline in investor trust can be linked to companies engaging in highly priced M&A that offers little promise for real growth.

In Deloitte’s 2021 Tracking the Trends report, it highlights that mining companies are on a journey to win back investor trust.

One way of achieving this is by engaging in M&A deals that will almost certainly deliver additional value to shareholders.

Deloitte partner, corporate finance, Nicki Ivory, says there needs to be a particular purpose for joining two companies together.

“It shouldn’t be growth for the sake of growth, the kind we’ve seen historically, where there is a huge, inflated price or a big control premium,” Ivory says.

“M&A between big and small companies has historically struggled to provide value.”

What Ivory believes to be an ideal M&A deal is one that involves two companies of a comparable size. This will open up a different narrative on why the transaction takes place.

Such a strategic and deliberate use of M&A implies that an agreement is more of a merger than a takeover, which the deal between Northern Star Resources and Saracen Mineral

– 12 –

Holdings represented when it was finalised earlier this year. Touted as a merger of equals by the measure of their relative share prices, production, reserves and resources, and management team, Ivory says the concept of paying a high premium should slip into the background.

“It is about forming something bigger and better than the individual units,” Ivory says.

“The term collaborative is a really good way to join together benefits for both the sector and shareholding groups. Benefits and synergies are being joined together without having to incur a massive premium.”

A different type of M&A agreement that the mining sector may now witness is a consolidation of different scales, Ivory says.

Companies might make an investment along their supply chain to, for example, secure volumes of critical minerals.

Ivory also pre-empts a disruptive kind of M&A, such as that portrayed by Wesfarmers’ interest in acquiring Lynas Rare Earths in 2019.

“You’ll see people you wouldn’t usually see investing in mining suddenly being in mining. Wesfarmers, for example, owns a chemicals business,” she says.

“But its proposal was about integrating the future-looking minerals (from Lynas) to Wesfarmers’ chemicals business.

“Tesla has also made comments that they

wanted to get closer and closer to critical minerals to ensure it has certainty of supply down the line.”

If there’s one rule of thumb that mining companies need to go by to preserve shareholder trust before conducting M&A, it is to ask themselves whether they are pursuing a deal to build an empire.

To rebuild investor trust through M&A, Deloitte suggests to: Protect value. “Miners should remain focused on preserving value, delivering consistent returns and extracting synergies for investors.”

Leverage scenarios in the M&A planning process. “Today’s altered landscape … (it) is a good moment in which to reimagine the future scenarios on which your planning currently depends. This may involve engaging a broader set of stakeholders to foresee alternative pathways that can inform your portfolio strategy and transactional focus in the years to come.”

Use M&A strategically. “The mining sector seems ripe for a range of disruptive moves, and as mining companies develop their strategies for the next three to five years, there is a real opportunity to consider a range of defensive and offensive moves.”

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F E AT U R E D

An artist’s impression of what mining might look like in the future.

Ethical considerations of artificial intelligence in mining

BY IBM DATA INSIGHTS AND AI PRACTICE LEADER, ABHISHEK KAUL, AND VALE GLOBAL AI PROJECTS LEADER, ALI SOOFASTAEI.

I

n recent years, there has been increased attention on the possible impact of future robotics and artificial intelligence (AI) systems.

Prominent thinkers have publicly warned about the risk of a dystopian future when the complexity of these systems progresses further. These warnings stand in contrast to the current state-of-the-art robotics and AI technology.

Digital transformation and applied automation are growing fast in the mining industry. It is essential to adapt to the mining industry with the related innovations, which play critical roles in the digital revolution.

The core of these innovations is applied machine learning (ML) and AI across the mining value chain.

Many of us would assume that the mining industry would have driven advances in robotics, automation, AI and ML due to the remote

– 14 –

mine sites, the hazardous nature of the work and the high costs of labour and transport.

However, it is the manufacturing sector that has spearheaded most of the technological developments, but it is now the mining sector that is taking advantage of those proven technologies to help boost its recovery after a significant downturn.

In today’s highly efficient mining operations, making the right decisions depends on their 360-degree visibility of the business and the market, combined with accurate demand forecasting.

With huge footprints in remote locations, diverse labour forces, and complex and time-consuming projects, mining companies are using enterprise resource planning (ERP) and advanced analytics systems as the technology backbone to their businesses.

ML and AI are the main part of an advanced data analytics

AUSTRALIAN RESOURCES & INVESTMENT

Many of these techniques depend on ML. For example, the ability to automatically learn from historical patterns in data and improve performance over time.

The difference between AI and ML can be a little confusing. Figure 1 (below) illustrates the general boundaries between these concepts.

AI and ML boundaries.

approach, which is increasingly being relied on to make decisions about people, processes and technologies, be it accessing worker productivity to explore the next mine site or predict to schedule equipment for maintenance.

Although AI and ML-based analytics are delivering results, its recommendations for people-based decisions are subject to ethical considerations. Issues arise if AI and ML models have a bias based on gender, age or ethnicity and is not fair in providing recommendations.

There are multiple AI policy guidelines available from the United States, Europe and Asia to help organisations ensure that they build and use ethical AI. This article discusses AI use cases in the mining industry with ethical considerations, reviews critical challenges and potential bias mitigation strategies.

U N D E R S TA N D I N G E T H I C S I N A I AI is intelligence demonstrated by machines, unlike the natural intelligence displayed by humans. AI refers to systems that display intelligent behaviour by analysing and interpreting the data, learning patterns in data, provide reasoning and recommendations, and optionally take actions with some degree of autonomy to achieve trained goals.

AI systems work very well at use cases where they involve recognising patterns with large quantities of data. AI systems work best together with people, and it is important to understand that AI requires reskilling people, not replacing them.

There are many AI techniques like supervised learning, unsupervised learning, reinforcement learning, transfer learning, knowledge graphs, reasoning systems, and more.

AI IN THE MINING INDUSTRY Mining is a complex and fluctuating industry that is fraught with uncertainty around resource pricing, unpredictable resource fields and major projects that need to be managed right through their lifecycle.

Controlling costs for mineral exploration, construction and operation right through to project completion is a monumental challenge, but if the financial elements are managed well, it can help mining companies to be both competitive and profitable.

The key to increasing profits is knowing the precise time to increase production when there is strong demand using resource planning, improving the reliability of machinery with predictive and conditionbased maintenance monitoring, delivering clarity with precise financial and operational reporting, and at the same time, providing actionable insights using real-time data extracted from every part of the organisation.

There are considerable benefits of using an AI system to improve the quality of work at a mine site and reduce the human failures and hazards.

AI use cases have been applied across the complete mining industry value chain from exploration, mine management, extraction, processing and transportation.

Mining value chain.

Data is fed into the AI systems. The data comes from a variety of sources like equipment, shift log, operator manuals, operator wearable, CCTV cameras, HR systems, shift rosters and more.

Although ML and AI, by their very nature, are always a form of statistical discrimination, the discrimination becomes objectionable when it places certain privileged groups at the systematic advantage and certain unprivileged groups at a systematic disadvantage.

Objectionable discriminations arise due to multiple reasons in the mining industry. The main reasons are:

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F E AT U R E D

Defining the business objective of the machine learning problem – for example, if the business objective is defined as maximum throughput without consideration for maintenance or safety aspects.

Unrepresentative data or data with existing prejudice for training – for example, if the AI model training data has been selected from a mine site where the demographic of the population is from the older age group.

Selecting the attributes or features for the ML model – for example, if in building the AI model, operator ethnicity has been included as a data point mobile mine equipment operator behaviour.

This article focuses on three main use cases of AI in mining: Energy: ethics in reducing fuel consumption Maintenance: ethics in predictive maintenance Safety: ethics in using surveillance video (CCTV) for safety.

POLICY GUIDELINES FOR ETHICAL AI Many countries have published AI policy guidelines. These guidelines provide a broad level objective for the use of AI – to ensure humancentric, safe and trustworthy AI. Most guidelines make the organisation using AI responsible and accountable for their decisions and ask for the same ethical standards in AI-driven decisions as in human-driven decisions.

General key points achieved from global guidelines are: It should be lawful, complying with all applicable laws and regulations.

It should be ethical, ensuring adherence to ethical principles and values.

It should be robust, both from a technical and social perspective since, even with good intentions, AI systems can cause unintentional harm.

To ensure compliance with ethical guidelines, AI models need three capabilities.

1. Explainability – An ability to explain the behaviour of the black box AI model. Multiple algorithms help to explain the model. For example, decision tree rules if A > 50, then stop else continue, are easily understood by people.

2. Fairness – The ability of AI models to report and mitigate discrimination and bias. Depending on the application of the AI model, the appropriate bias metrics should be reported. For example, for hiring, a false-positive (someone unfit for the job is employed) is less harmful than a false negative (someone fit for the job is denied). Further, bias mitigation algorithms can be applied to improve the fairness metrics by modifying the training data, the learning algorithm, the predictions, the optimisation or the making decision models.

3. Transparency – The ability of the model to be transparent on training data, accuracy and performance, bias and fairness metrics so that users can understand how AI was trained and deployed.

A I U S E C A S E S W I T H E T H I C A L C O N S I D E R AT I O N FOR THE MINING INDUSTRY In this section, three use case details are presented with ethical consideration for AI in the areas of energy, maintenance and safety.

It is important to understand that AI is not about replacing people, but reskilling people and deployment of AI applications will improve the quality of work at a mine and reduce the human failures, hazards at the site.

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U S E C A S E 1 : A I A P P L I C AT I O N F O R E N E R GY EFFICIENCY – ETHICS IN REDUCING F U E L C O N S U M P T I O N (C O N S I D E R AT I O N – O P E R AT O R D E M O G R A P H I C S) Fuel is an important cost contributor for haul trucks in surface mining.

Multiple parameters affect fuel consumption like the type of truck, payload, distance, hours, weather and operator behaviour (includes speed, manoeuvring, acceleration and braking).

AI techniques like Artificial Neural Networks (ANNs) are generally applied to data to understand the top factors influencing fuel consumption and recommend changes to controllable factors, thereby reducing fuel consumption per tonne of ore mined by using a genetic algorithm (GA) in the optimisation phase of the project.

Advanced data analytics applied to minimise haul truck fuel consumption.

One of the predictors for haul truck fuel consumption is the operator (driver) behaviour. If demographic data points of a driver are included as attributes or features, then the AI model will identify patterns in demographic data that influence operator behaviour.

Depending on the training data set, for example, country, mine site, or number of operators, this analysis may have bias and may not hold true for the general case. Maybe the model can get biased to predict low fuel consumption for older male workers based on one mine site operation.

In such applications, it is recommended not to include demographic data in the analysis and rely solely on the unique mine equipment operator identifier. Unless essential, if the use of demographic data is needed, de-biasing techniques like reweighing, adversarial de-biasing should be applied with visibility on fairness metrics like statistical parity difference, Thiel index, and more should be enforced.

Ideally, the business objective of the AI model should be finetuned to provide guidelines to an operator to influence their behaviour – like speed, acceleration, etc, and provide a mechanism to monitor for deviations in operator actions to AI recommendations.

U S E C A S E 2 : A I A P P L I C AT I O N I N M A I N T E N A N C E – ETHICS IN PREDICTIVE MAINTENANCE (C O N S I D E R AT I O N – O P E R AT O R S H I F T L O G S / N L P) Equipment downtime significantly affects the productivity and safety of mining operations. The main goal of predictive maintenance is to shift the unplanned breakdowns to planned maintenance activities, increase the equipment lifetime, optimise maintenance schedules and ensure safe operations.

AI techniques in machine learning like cox regression, logistic regression, gradient boosting, neural nets are applied to predict the remaining useful life (RUL) and predict the health score of equipment

AUSTRALIAN RESOURCES & INVESTMENT

using historical maintenance data.

Further, natural language processing (NLP) techniques like Word2Vec, BERT are applied on operator shift logs to gain a deeper understanding of operational events like faults, trips, overriding, noise, resetting observed, actioned and documented by the operator, which are then co-related to maintenance failures to provide deeper insights.

object tracking, and raise proactive alerts in realtime to detect and mitigate any safety or security violations.

Advanced data analytics applied to detect non-compliance behaviour using CCTV footage.

Advanced data analytics applied to predict mine equipment failure using equipment data and operator logs.

One of the data points used in the analysis to discuss further is the operator shift logs.

Operator privacy is one of the considerations for analysing logs. However beyond privacy, when analysing operator logs, if language linguistics analysis is used for deciphering personal traits, personal attributes – like modelling and then to co-relate maintenance failures – inclusion of bias becomes a relevant topic and it is subject to ethical considerations.

In such applications, it is recommended to use the co-relation of events (nouns, verbs) with maintenance failures for providing slack time in operation for operators to do necessary maintenance inspections.

Further, it is recommended to de-bias the NLP models, which may cause some drop-in accuracy points but helps to keep the recommendations fair.

U S E C A S E 3 : A I A P P L I C AT I O N IN SAFET Y – ETHICS IN USING S U R V E I L L A N C E V I D E O (C C T V ) F O R S A F E T Y (C O N S I D E R AT I O N – S U R V E I L L A N C E V I D E O DATA ) Video surveillance data (CCTV cameras) are used in many work areas to ensure the security and safety of the site. Typically, hundreds of cameras feed data to the site security/safety office.

Since it is not possible to review the feed from all cameras in real-time by the human operator, the use case for video surveillance trends towards post-facto video retrieval and analysis for historical incidents, disputes.

With advancements in computer vision technologies, AI models are trained with the surveillance video feed to perform automated analysis for object detection, object classification,

Surveillance is itself an ethically neutral concept. What determines the ethical nature of a particular instance of surveillance will be the considerations which follow, such as justified cause, the means employed and questions of proportionality.

While it can be argued that monitoring remotely via a camera is no different from historical times when security personnel were physically present at the worksite, there are local privacy laws and regulations which must be complied with while using surveillance, face recognition technologies.

AI technologies in computer vision are leapfrogging every few months, like being able to understand the Spatio-temporal relationships of objects, which can be used to monitor people’s behaviour based on the change of posture, time of day, relationship with equipment, movement between areas, and more.

Ethical considerations when employing AI for surveillance monitoring should have a balance between workers privacy-trust-autonomy and workers’ safety-security-behaviour.

CONCLUSION Understanding the implications of ethics in AI is important for mining companies to remain fair to their workforce as they are in human-driven decisions.

Mining companies should adopt and build AI solutions that follow leading policy guidelines and are explainable, transparent and fair. Further, when evaluating the AI solution, they should understand how the solution has built the data used in training the AI models.

In order to enforce ethical considerations for AI, mining companies can appoint an AI ethics officer or committee for the review of each AI application being developed or purchased from vendors and request disclosure on the fairness, explainability and transparency metrics.

References https://en.wikipedia.org/wiki/Ethics_of_ artificial_intelligence#cite_ref-90 https://plato.stanford.edu/entries/ethics-ai/ https://www.pdpc.gov.sg/-/media/files/ pdpc/pdf-files/resource-for-organisation/ai/ sgmodelaigovframework2.pdf https://www.pdpc.gov.sg/Help-andResources/2020/01/Model-AI-GovernanceFramework Soofastaei Ali, and et al. “Reducing Fuel Consumption of Haul Trucks in Surface Mines Using Genetic Algorithm,” Applied Soft Computing Journal, Under Press (2020).

Soofastaei Ali, and et al. “The Effect of Average Truck Speed on Fuel Consumption in Surface Mines,” Mining Journal, Volume 4, Issue 2, (2016), P:92-94.

Everyday Ethics for Artificial Intelligence – IBM https://www.weforum.org/agenda/2016/10/ top-10-ethical-issues-in-artificial-intelligence/ https://wef-ai.s3.amazonaws.com/ WEF_Empowering-AI-Leadership_Ethics_ Appendix-1.pdf https://www.scu.edu/ethics-in-technologypractice/ethical-toolkit/

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australian owned

mackay PO Box 9094, Slade Point QLD 4740 370 Airstrip Road, Nebo QLD 4742 Ph: (07) 4951 4831

GOLD

NEWCREST RIDES A WAVE OF CHANGE Sandeep Biswas discusses a testing time for the mining industry and how Newcrest Mining is responding to the challenge.

N

ewcrest Mining managing director and chief executive Sandeep Biswas has named technological disruption, climate change and changing societal expectations as the key challenges the industry must face up to.

Despite this testing environment, Biswas believes mining is well placed to take on these challenges if everyone in the industry uses a common and progressive approach.

He says that success in the future is now, more than ever, about having a strong purpose, as well as solid commitments and strategies around ESG (environment, social and corporate governance), inclusion and diversity.

“I believe as an industry we have the power to lead that change.

And at Newcrest, we will be doing that by creating a brighter future for people through safe and responsible mining,” Biswas, presenting at the Melbourne Mining Club, says.

With mining under pressure to reduce greenhouse gas emissions from its operations, Biswas says the industry has the ingenuity, technology and capability to meet this challenge.

He points to how the sector is quickly moving to remove diesel-powered vehicles from mines to

eliminate carbon fuels from operations.

“I think this is becoming a real possibility in many instances, with the technical advances we are seeing. And strategic partnerships across sectors can bring forward investment in renewables and help us to get closer to zero carbon emission in our businesses,” Biswas says.

At Newcrest’s Cadia gold mine in New South Wales, for example, the company is currently a large consumer of coal powered electricity in the state.

However, Newcrest is moving towards using renewable sources at Cadia, in this case wind, for 40 per cent of its energy requirements from 2024 once a wind farm has been built.

Biswas says through Newcrest’s efforts and through general decarbonisation of the grid, it is realistic to aspire for Cadia to have minimal to zero power input from carbon sources in the future.

“If we bring in the technology advancements in electric vehicles, battery storage and other technologies, we can see a way to bring on-site emissions to

Newcrest is plotting its path to a golden future.

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AUSTRALIAN RESOURCES & INVESTMENT

If we bring in the technology advancements in electric vehicles, battery storage and other technologies, we can see a way to bring on-site emissions to zero or close to it. zero or close to it,” Biswas says.

“These technologies will also allow us to eliminate diesel particulates underground and reduce energy intensity and the cost of ventilation.”

From a social perspective, Biswas thinks that local community partnering, from a capability and reputation viewpoint, will become a strategic competitive advantage in a company’s ability to acquire and develop an asset in the not-too-distant future.

He says Newcrest’s leadership team spends time in local communities because its members understand that on-the-ground, frontline relationships are the most important the company can have.

Newcrest’s experience at the Lihir gold mine in Papua New Guinea has been a standout example of improving community engagement for the company.

Biswas concedes that Newcrest’s relationship with local landholders and community, as well as the provincial government, at Lihir was difficult when he started with the company.

“Much of the money that had been destined for good works in the community was being wasted due to poor governance and execution.

And the community had little to show for the many millions that had been spent on well-intentioned endeavours over the years,” Biswas explains.

“Over the past seven years, and it has been a long process, we have worked on rebuilding relationships with government and community stakeholders. We have not had a community disruption to the operation for six years.

“We have new compensation, relocation and benefits sharing agreements with the mining lease area landholders. We have a new governance regime for the distribution of funds, and Newcrest and a broader range of community stakeholders have a seat at the table.”

For Newcrest to do the things it wants to do, including delivering these strategies and positively impacting society, Biswas says it needs access to the full suite of talent within its workforce.

Newcrest targets employees from all walks of life: technical and non-technical, creative, numerate, from different ethnic, socioeconomic and cultural backgrounds.

Biswas says Newcrest needs to be able to tap into new perspectives and harness the richness of diversity of thought.

“The bigger view of diversity drives what I like to call ‘uncommon sense’ innovations, by looking at things from different angles and

Newcrest MD and CEO Sandeep Biswas at the Melbourne Mining Club.

talking to people inside and outside the business who do things differently; people who we don’t normally talk or listen to as much as we ought to,” he says.

“Many of our breakthroughs can then just quietly happen through the engine room of bottom-up innovation. From our people.

“A lot is said about diversity – but I have come to the realisation that inclusion is probably more important, insofar as it is only through true inclusion can we get true diversity.

“An inclusive workforce in which people have a sense of belonging and feel able to contribute their best is more likely to be diverse.”

From an operational perspective, Newcrest plans to grow by focusing on traditional methods: exploring, building new mines and expanding existing ones.

The company will also increase its investment in innovation and digital technology to guide this growth.

Biswas says Newcrest continues to apply and extend its competitive capabilities through innovation and technology to capture new value, sustainably.

“For example, today, we have collaboratively developed high temperature explosives and remote handling equipment that can be used in 150-degree temperature environments,” Biswas says.

“We have adapted high precision, underground drilling and blasting techniques that can potentially remove the need for undercut levels in block caving.

“This could materially drop the establishment cost of our future block caves. We have exploration technologies, analysis and big data processes that help target new exploration discoveries under deep cover.

“We have leveraged technology used in other industries such as agriculture and defence to mineral exploration.”

Biswas believes these innovations and digital capabilities have played a big part in how the company looks today. And will continue to do so as the industry decarbonises and the world moves towards a zero carbon future.

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GOLD

Reducing the carbon footprint of gold operations

BY SA M ULR ICH, PR INCIPAL CONSULTANT OF CSA GLOBAL, AN ER M GROUP COMPANY, AND PHD CANDIDATE THE UNIVER SIT Y OF WESTER N AUSTR ALIA

G

old mining is an energy-intensive and greenhouse gas (GHG) emissions-intensive industry. With climate change risks identified as financial risks and the Paris Agreement’s adoption in 2015, far greater scrutiny is being placed on companies’ GHG emissions and actions to mitigate them to become more environmentally sustainable.

Presently, investment funds (e.g., BlackRock) and sovereign wealth funds (e.g. Norway) are reducing their carbon footprints by minimising their exposure to fossil fuels (e.g. thermal coal).

Funds are pressuring lenders they invest in to have greater transparency of their carbon footprints. Additionally, these funds require the companies they invest in to improve their disclosure of climate risks and their mitigation measures.

It is anticipated that the financial community will broaden its lower emissions emphasis from fossil fuels to other energyintensive industries in the future, such as the gold industry.

U N D E R S TA N D I N G G H G E M I S S I O N S I N G O L D M I N I N G The reporting of GHG emissions is subdivided into three scopes: Scope 1 – Direct emissions from sources a company owns or controls (e.g. emissions from on-site electricity generation, mining, processing and smelting to produce gold/dore bars).

Scope 2 – Indirect emissions from the consumption of purchased energy at an operation owned or controlled by a

GHG emissions vs. all-in sustaining costs at Australian gold mines.

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company (e.g. purchase of grid electricity generated by burning coal or natural gas).

Scope 3 – Indirect emissions that occur in the broader economy due to a company’s activities. However, are from sources not owned or controlled by the company, (e.g. emissions from the production of purchased materials and fuels, transportation of goods to the site, flying on commercial planes, and the refining and subsequent use of the gold).

Emissions are reported as a carbon dioxide equivalent (CO2-e), which includes the following greenhouse gases; carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), sulphur hexafluoride (SF6), hydrofluorocarbons (HFCs) and perfluorocarbons (PFCs).

Most large and mid-size gold mining companies report total Scopes 1 and 2 emissions of their company, with the majority also providing a breakdown for their individual mining operations.

Presently very few companies report Scope 3 emissions. Gold mining is different from commodities like iron ore or coal, as most Scope 3 emissions occur upstream from the mine, i.e. emissions from suppliers of goods and services to the mine.

Scope 3 emissions for coal and iron ore are mostly downstream, from combustion and reduction to produce steel, respectively.

Also, generally, a GHG emissions intensity is reported to measure performance year on year. There are two commonly used emissions intensities in gold mining: the GHG emissions per tonne of ore processed; and the GHG emissions per gold ounce produced.

The emissions intensity per ounce of gold produced is best for comparing companies or mines in the form of a GHG emissions intensity curve. The key drivers of the emissions intensity per gold ounce produced are the mines energy source, the type of mine whether open pit or underground, the gold grade of the ore and depth of mine.

The emissions intensity per tonne of ore processed is useful for assessing absolute changes in GHG emissions at a mine with steadystate production. However, it is not useful for comparisons between mines unless they have the same nameplate processing capacity.

R E L AT I O N S H I P S B E T W E E N G H G E M I S S I O N S A N D P H Y S I C A L G O L D M I N I N G PA R A M E T E R S A recent study investigated the relationships between GHG emissions, gold grade, energy source, mine type and production costs (AISC – all-in sustaining costs) in Australian gold mines (Ulrich et al. 2020).

There is a strong relationship between the gold grade of the ore processed and GHG emissions intensity per ounce of gold produced. The higher the gold grade, the lower the GHG emissions intensity (and vice-versa) and the lower the AISC. The data also broadly grouped based on the type of mine whether open pit, underground or was an operation that sourced

AUSTRALIAN RESOURCES & INVESTMENT

GHG and costs of different gold mine types.

ore from both open pit and underground. They had reasonably distinct footprints.

On average, open pit mines have the highest GHG emissions intensity and lowest AISC. Mines that source ore from both open pit and underground sources had the highest costs, but lower GHG emissions intensity.

Underground mines have the lowest GHG emissions intensity and costs lower than mines that source ore from both open pit and underground but higher than open pit mines.

On average underground mines in Australia have an emissions intensity 40 per cent lower than open pit mines. Further research has shown that underground and open pit mines in other countries have these same systematic differences in GHG emissions intensity and production costs.

A challenge within the gold industry is that of declining gold grades. In Australia, gold grades have declined 25 per cent from 2.44 grams a tonne (g/t) gold in 2006 to 1.83 g/t gold in 2017 (Schodde, 2017).

They are predicted to fall a further 44 per cent to 1.02 g/t gold by 2029. A 44 per cent decline in gold grade means a 32-50 per cent increase in GHG emissions intensity, depending on whether a mine is an open pit or underground operation or a combination of the two.

E N E R GY S O U R C E C O M P E T I T I V E A DVA N TAG E Some gold producing countries have a distinct competitive advantage over others due to the energy sources available in that country. For example, most of Canada’s gold mines are located in provinces with predominantly low emission energy sources (e.g., hydroelectricity and nuclear).

However, Australia’s gold mines are reliant on energy from fossil fuels. In Australia, gold mines are either connected to grid electricity

predominantly generated from coal and natural gas or are remote mines generating electricity on site from diesel and gas.

To put this into perspective, Canada’s gold mining industry’s weighted average GHG emissions intensity is 244kg CO2-e/ounce (oz), whereas Australia’s is 637kg CO2-e/oz.

At the upper end is South Africa’s gold industry with a weighted average GHG emissions intensity of 2754kg CO2-e/oz, whose electricity is generated from low-quality coal. Additionally, many of the South African mines are more than two kilometres in depth with considerable energy required to ventilate and cool them.

Gold miners are starting to address society’s concerns over climate change and investors’ concerns of financial risk by increasing disclosure of their climate risks and carbon footprints, while undertaking activities to abate GHG emissions.

Current abatement measures involve either energy substitution or undertaking energy efficiencies. Energy substitution either involves replacing one fossil fuel with less carbon-intensive fossil fuel (e.g. diesel to gas) or replacing it with renewables (e.g. solar and wind).

Recent Australian examples of mines that have undertaken energy substitution include the Agnew, Tanami and Granny Smith mines.

Energy efficiencies can include strategies to minimise fuel use or installing ventilation on-demand in underground mines. The introduction of electric vehicles and mining fleet in underground mines reduces both fossil fuel use and the energy required for ventilation.

Only a few mines in Canada have embarked down this path due to the early technology stage of electrified mining fleet.

We can expect to see more mines in coming years embrace this form of technology to combat climate change and reduce their greenhouse gas emissions successfully.

CSA Global principal consultant Sam Ulrich.

References Schodde, R., 2017. Long-term Forecast of Australia’s Mineral Production and Revenue.

The Outlook for Gold: 2017-2057. MinEx Consulting, 89pp.

Ulrich, S., Trench, A., Hagemann, S., 2020.

Greenhouse gas emissions and production cost footprints in Australian gold mines.

Journal of cleaner production 267, 122118.

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GOLD

Gold miners break new records

BY ANTHONY FENSOM New developments and expansions look set to build on the gold industry’s milestones from 2020.

A

ustralia’s gold miners have broken production records amid record high prices and a surge in investment and exploration activity. Are the good times here to last for the precious metal?

Amid a new gold rush, Australia produced a record high 327 tonnes of gold in 2020, despite the challenges caused by the COVID-19 pandemic, according to Surbiton Associates.

Among last year’s milestones was the “deal of the year,” the sale of the Super Pit from Barrick Gold and Newmont to Saracen Mineral Holdings and Northern Star Resources. The Super Pit’s buyers subsequently merged to become Australia’s second-biggest gold miner.

The Super Pit was the fifth-largest producer of Australian gold in 2020 with around 453,000 ounces, while Newcrest Mining’s Cadia East operation topped the list with 822,478 ounces.

More records may tumble for Australia’s gold sector, with the nation projected to become the world’s top producer in 2021 with 384 tonnes of output, according to the March 2021 Resources and Energy Quarterly produced by the Office of the Chief Economist.

Higher prices are expected to increase the value of Australia’s gold exports to a record $29 billion in fiscal 2021, according to the government forecaster.

Australia’s gold mine production is projected to expand at an average annual rate of 5.7 per cent from fiscal 2021 to 2024, peaking at 410 tonnes in fiscal 2024.

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Growth is expected to be driven by mine expansions and reactivations, together with new mines, including Red River’s Hillgrove mine in New South Wales and NQ Minerals’ Beaconsfield mine in Tasmania.

Expansion projects include St Barbara’s Gwalia Expansion in Western Australia and the Tropicana Expansion project, together with expansions by Newcrest Mining and Newmont.

Platina Resources managing director Corey Nolan.

N E W D I S C OV E R I E S Explorers have been buoyed by new discoveries, such as De Grey Mining’s Hemi discovery in WA, which has spurred a “21st century gold rush” in Australia’s top mining state.

Overall, Australia’s gold exploration expenditure increased by nearly 16 per cent in 2020 to reach $1.3 billion, nearly half the nation’s total exploration spending.

WA’s mines department reported $17 billion of gold sales during 2020, a record high, on the back of a record average gold price of $2500 per ounce.

The state is expected to remain Australia’s largest gold producer, accounting for 68 per cent of total mine output in fiscal 2021, according to the Office of the Chief Economist.

“These are fantastic times to be a gold explorer in Western Australia, home to some of Australia’s biggest discoveries,” Platina Resources managing director Corey Nolan says.

“Investors are backing the sector and with exploration increasing we will undoubtedly see more new discoveries in the Pilbara and elsewhere.”

Platina is building its gold presence in WA, recently signing a term sheet to acquire the Xanada gold project near the multimillion ounce Mt Olympus deposit.

It has also announced the start of drilling at its part-owned Munni Munni project near Karratha, which it described as one of Australia’s largest undeveloped palladium deposits.

Platina also plans a maiden drilling

AUSTRALIAN RESOURCES & INVESTMENT

Kalgoorlie’s historic Super Pit is now under Australian ownership.

program at its wholly owned Challa gold project, located in between the prolific Mt Magnet and Sandstone gold districts.

Other explorers are seeking to follow in De Grey’s footsteps, including Sayona Mining, which has a portfolio of gold and lithium projects in the Pilbara region.

The company is targeting intrusionrelated gold mineralisation similar to the Hemi discovery, with some tenements located in close proximity to Hemi.

In April, Sayona announced a 3900 line kilometre airborne magnetic survey over its Deep Well and Mt Dove projects, as it plans to identify targets for drilling in 2021.

Sayona managing director Brett Lynch says the company is encouraged by the potential of its WA exploration assets.

“The commencement of exploration over our 100 per cent owned Pilbara gold portfolio has identified a number of targets for further exploration and drilling in the 2021 season,” he says.

“It is anticipated the studies and proposed geophysical work will build up targets which will focus exploration and unlock the prospectivity of the large tenement holding that Sayona has close to the Hemi discovery.

“We also remain excited by the potential of our WA lithium assets, located in the world-class Pilgangoora lithium district, which add to our flagship lithium projects in Canada.”

BRIGHT OUTLOOK While rising global growth and higher bond yields have weighed on gold prices in 2021,

Visible gold from Platina’s Challa gold project.

increased inflation and a weaker US dollar should see prices rising again, according to ANZ Research.

“With policymakers still advocating immense policy support, the likelihood of bond yields falling is low. However, we now expect US inflation to hit 2.5 per cent this year,” an ANZ report from February states.

“Combined with further depreciation in the (US dollar), we see gold’s fair value at $US2000 ($2581) per ounce in the second half of the year.”

The bank’s economists note that “gold performs best when inflation is rising, rates are falling and the (US dollar) is weak.”

However, other analysts are less bullish, with Fitch Solutions projecting an average gold price of $US1780 per ounce for 2021 and Capital Economics expecting $US1600.

A Reuters poll of analysts and traders conducted in late April found a median forecast of $US1784 for 2021 and $US1743 for 2022.

On May 12, gold was trading at $US1832 per ounce on COMEX, down from its 2020 high of $US2056.

Other factors influencing the precious metal include the risks of rising geopolitical tensions, with gold seen as a safe haven in times of crisis.

In its April 29 report, the World Gold Council (WGC) notes that strengthening consumer demand is mitigating the impact of outflows from gold exchange-traded funds.

Gold “retains its relevance in wellbalanced portfolios, especially with a risk of inflation looming. Looking ahead to the rest of the year, we see reasons to be optimistic about the gold market as its main drivers remain well supported,” WGC senior markets analyst Louise Street says.

With more records set to be broken by Australia’s gold miners, the local industry sees plenty of reasons for optimism.

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GOLD

The underground portal at the Wiluna gold mine.

Wiluna to transform WA gold site Milan Jerkovic discusses the expansion opportunities that will potentially give Wiluna Mining one of Australia’s largest gold operations.

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iluna Mining is fast approaching a major milestone in the staged transformation of its namesake operation in Western Australia’s northern Goldfields in to one of Australia’s biggest gold mines.

The milestone is the commissioning in October of a new 750,000 tonnes per annum (tpa) flotation concentrator at the historic operation to process refractory sulphide ore, more than doubling annual gold output from the current oxide only operation to as much as 120,000 ounces from May 2022.

Wiluna Mining has an aggressive expansion plan for the gold mine.

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Wiluna is not stopping there. A stage two expansion to an expected annual rate of 250,000 ounces of gold by 2024 (the concentrator will be scaled up to 1.5 million tpa) is the subject of a bankable feasibility study due to be completed by the end of (calendar) 2021.

Wiluna executive chairman Milan Jerkovic is not sure if the 250,000-ounce annual rate will be the end of the story either.

“We continue to work towards bringing Wiluna (it has a gold resource of more than 7 million ounces, the seventh biggest in Australia under single company ownership) to its full potential,” Jerkovic says.

“What size this is we are not sure yet, but it would seem that a minimum of 250,000 ounces annually through the multi-circuit processing facility we plan in stage two is where the feasibility study is taking us.

“And depending on drilling and discovery, particularly at the largely untested depth of below 600 metres, it could be one of the largest gold mines in Australia.”

Jerkovic also highlighted the exploration potential away from the main mining centre, one with a 120-year mining history in which peak production was also based

on the mining and processing of sulphide ores rather than the oxide focus in its recent history.

“When you consider that within our 1600-square-kilometre tenement package we have a potential Wiluna look alike in Regent, as well as two stand-alone potential mining centres in Lakeway and Matilda, the future for Wiluna mining operations looks very attractive,” Jerkovic says.

Jerkovic is the first to acknowledge that Wiluna’s recent history as an oxide gold only producer is chequered. It is why he introduced the transformation plan in 2019, saying at the time it would take three years and would require time, capital and a disciplined approach.

A $39 million capital raising was being wrapped up in May to maintain the momentum in the transformation plan, one that also requires an increase in Wiluna’s underground sulphide ore reserves.

To that end, the feasibility study due for completion at the end of 2021 involves a reserve drilling campaign aiming to add an additional 500,000 ounces to the current underground ore reserve of 661,000 ounces at 4.74 grams of gold a tonne.

WILUNA MINING (ASX:WMX)

Awaking the sleeping giant The restoration of one of Australia’s largest gold mines is underway.

Already with 7 million ounces of Mineral Resources and being the 7th largest gold project in Australia *, Wiluna has significant growth potential (+ 5 million ounces to 7 million ounces), which is underpinned by current and fast growing operating cashflows. This makes Wiluna the best leverage gold investment opportunity on the ASX.

Jim Malone jmalone@wilunamining.com.au +61 419 537 714 Level 3, 1 Altona Street, West Perth WA 6005 PO Box 1412, West Perth WA 6872 www.wilunamining.com.au *based on Mineral Resources under single ownership

COPPER - GOLD

Historic Victorian project on track for golden revival James Chirnside discusses Dart Mining’s plans to make an exploration breakthrough at the Granite Flat project in Victoria.

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art Mining is confident it is on to a significant copper-gold discovery at its project near the town of Mitta Mitta on the Omeo Highway in north-east Victoria.

Drilling by Dart at the historic project – it was a gold producer from 1856 to 1918 – has returned high-grade zones of gold-coppersilver, as well as highlighting the potential for a bulk tonnage porphyry copper-gold system.

“We’ve got high hopes that Granite Flat will shape up as a significant discovery,” Dart managing director James Chirnside says.

Drilling is again underway at the property following up last year’s program in which seven of the 42 drill holes were mineralised throughout, with the mineralisation continuing beyond the depth limit of the drill rig.

While the drilling returned some impressive results, the campaign also confirmed the complex nature of the mineralised system.

“So we’re about to start a geophysical program focusing in on an area three kilometres by two kilometres where we have established some very interesting mineralisation,” Chirnside says.

“The result of the survey will be really interesting and we have got all of the permissions we need to undertake an extensive reverse circulation and diamond drilling program (the company owns its own diamond drilling rig).”

At the company’s Sandy Creek project north-west of Eskdale, drilling at the historically high-grade goldfield confirmed gold mineralisation remains open at depth and along strike at the O’Dell’s, Shamrock and Honeysuckle prospects.

The full extent of the bulk-tonnage potential of the targeted altered and mineralised granite remains to be tested.

More drilling is also planned to follow up the company’s first drilling campaign at the Rushworth project in central Victoria, picked up by Dart outside of its normal north-east focus in response to the rich Swan Zone gold discovery at the nearby high-grade Fosterville mine.

Future drilling at Rushworth will focus

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A quartz rock sample from Granite Flat.

on testing for strike and depth extensions to the multiple gold mineralised structures intersected in the recent drill program.

Dart is also stepping up lithium exploration in the region after a LIDAR survey allowed its geologists to “see through” the heavily vegetated terrain at its project in Victoria’s north-east to identify previously obscured targets.

“Using LIDAR was all about us exposing old gold mine workings, as well as building our lithium story by looking for out-cropping

pegmatites,” Chirnside says.

“It delivered in spades. It showed us significant extensions of a particular pegmatite that we know is fertile with spodumene (a lithium bearing ore) grading up to 1.4 per cent.”

Pegmatite swarms in the region extend from Eskdale down to Glen Wills to the south-east, with Dart planning a drilling program later in the year in response to the LIDAR revelations, and the dramatic recovery in lithium prices in 2021.

AUSTRALIAN RESOURCES & INVESTMENT

Potential builds for Thor ASX and AIM-listed Thor Mining has added potential game-changing South Australian copper and Western Australian gold projects to its portfolio.

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hor’s copper and gold legs are set to become a major focus for the Adelaide-based company in 2021 ahead of market upturns delivering fresh momentum to its existing critical minerals projects across tungsten, uranium and vanadium in Australia and the United States.

The copper push involves a new joint venture farm-in agreement to acquire up to an 80 per cent interest in the Alford East in-situ recovery (ISR) project on SA’s Yorke Peninsula.

Drawing on historic results from more than 500 holes, Thor has been able to establish a maiden mineral resource estimate of 177,000 tonnes of contained copper and 71,500 ounces of contained gold at the project in quick fashion.

Thor executive chairman Mick Billing says previous explorers have “drilled through and around the mineralisation over the years looking for the next Olympic Dam.” “They didn’t find another Olympic Dam, but they did intersect lots of low-grade oxide copper that appears to be suitable for extraction using ISR techniques,” Billing says.

The maiden resource at Alford East is spread over eight domains in a region which produced 300,000 tonnes of copper from conventional mining in the 1800s.

Producing copper from ISR techniques would be a first for SA, but the state has long produced uranium from the low impact and potentially low cost method.

Billing says the maiden resource at Alford East – it comes as copper prices have improved dramatically from the lows seen in 2020 – was of sufficient scale for Thor to plan testwork to confirm the technical feasibility of ISR production.

He believes the maiden resource is likely to be the start of the story as most of the exploration holes drilled by past explorers had bottomed out in mineralisation. “So there is plenty of depth extension possible,” Billing says.

Thor also has an indirect interest in the adjacent Alford West ISR project and the Kapunda ISR project through its 30 per cent equity interest in the private company, EnviroCopper.

Ahead of resource extension drilling and ISR testwork at Alford East, the recently cashed up Thor plans to drill its first exploration holes at the Ragged Range gold prospect in the Pilbara, about 40 kilometres west of Nullagine.

The drilling program is planned for late May/June and has received WA Government co-funding of up to $160,000 The drilling will test a 13-kilometre gold corridor identified by stream sediment sampling and an airborne magnetics survey.

Immediate follow up work will have a focus on the five kilometrelong Sterling prospect.

While SA copper and WA gold is very much the focus in 2021, the company’s critical minerals projects will also receive some attention, most notably its uranium and vanadium project in Colorado which is located within striking distance of a third party processing plant. Drilling is scheduled on these targets in June.

Thor has established a maiden mineral resource at Alford East based on historic results from more than 500 drill holes.

Thor has an exploration program involving its first drill holes scheduled for the Ragged Range gold project this year.

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B AT T E R Y M E TA L S

Roskill expects a challenging transformation to EVs across the value chain.

New ‘mineral dawn’ for Australian mining

BY ROSKILL PR INCIPAL LITHIUM ANALYST ALLAN PEDER SEN

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n the last few decades, Australia has benefited from production and exports of key commodities, such as coal and iron ore. This is a success story which continues to this day and is likely to do so for the foreseeable future, but there is a new “mineral dawn” on the horizon for Australia.

Climate change is moving up on the agenda of governments, as well as consumers throughout the world. Car manufacturers in Europe are facing fines if they do not achieve certain emission thresholds and will therefore increase the rate of introduction of new electric models providing consumers with a greater choice.

Subsidies are also being provided to consumers who purchase low emission vehicles. Chinese consumers have long been provided with incentives to switch to electric vehicles (EV) both in terms of monetary subsidies, as well as regulatory encouragements.

Roskill evaluates the entire EV value chain on a bottom-up approach based on extensive research, which shows the compound annual growth rate for EVs of 21 per cent a year between 2020 and 2030, with the primary growth coming from full EVs as well as plug-in hybrid electric vehicles (PHEV).

The transformation to EVs will be challenging across the value chain. Automotive manufacturers will have to convert existing production to produce EVs which requires billions of dollars of investments across the industry.

Cathode and battery manufacturers will also be required to invest heavily in capacity, both in their own countries as well as new

regions to support this transformation.

Roskill’s evaluation and analysis of the lithium-ion (li-ion) battery market shows that installed li-ion battery capacity will experience a compounded annual growth rate of 23 per cent a year between 2020 and 2030. This is expected to see total battery capacity demand for liion and lithium-based batteries approach 2500 gigawatt hours (GWh) by 2030, compared to ~250GWh in 2020.

T H I S G R O W T H A N D T H E S E E X PA N S I O N S P R OV I D E AU S T R A L I A W I T H A N O P P O R T U N I T Y The need for a large number of metals and minerals used either in battery production or in the production of the motors powering the vehicles are present in Australia. For production of batteries, Australia has significant resources of lithium, cobalt, nickel and manganese, while rare earth products required for the motors are

Figure 2 – Forecast installed Li-ion battery capacity, 2020-2030 (GWh)

Figure 1 – EV forecast by vehicle type, 2020-2030 (000 units)

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present in multiple deposits in operation or under development in Australia.

Roskill forecasts that the need for all key battery raw materials, as well as rare earth minerals will experience strong growth in the years to 2030. The charts on Figure 3 show demand growth for key minerals between 2020 and 2030.

The charts show strong demand growth for six key EV raw materials used in the battery and drivetrains. The strong demand growth necessitates the need for strong supply growth, and this is

AUSTRALIAN RESOURCES & INVESTMENT

Figure 3 – Demand growth for critical raw materials*

where one of the key challenges lies in the lead time and required investment to commission adequate supply of each of these raw materials.

Exploration, permitting, financing, construction, commissioning and product qualification by customers are all challenges shared across raw material supply chains.

The current pricing environment, as well as the price outlook will also be a critical element in the development of sufficient supply. In the lithium market, we saw a temporary oversupply appear in 2018, following additional capacity being brought online ahead of demand growth.

As a result, prices decreased to well below the levels required to incentivise new investments for roughly a two-year period. Demand eventually caught up to supply and prices have risen, but the lack of investments will have a long-term impact on the supply and demand balance.

Furthermore, companies and financial institutions are hesitant to commit capital until prices have stabilised at a level where investment can take place. Continued investment in both brownfield and greenfield projects, as well as new technologies, are needed on a continuous basis.

Australia’s place in the world of lithium is becoming more pronounced. In 2010, Australia mined 21 per cent of the world’s lithium, measured in LCE. This figure increased to 41 per cent in 2020 with additional mines, such as Pilbara Minerals’ Pilgangoora mine and Galaxy Resources’ Mount Cattlin mine, starting production.

Roskill forecasts that in 2030, Australia’s share of mined lithium will increase to 57 per cent in 2030 with the expansion of existing mines, as well as commissioning of new mines, such as the Wodgina mine owned by Albemarle and Mineral Resources, starting production.

While Australia can derive value from mining and initial processing of lithium minerals, additional value can be gained from further value-added processing. Examples of in-sourcing of processing is seen in the construction of a rare earth processing plant by Lynas Corporation in Kalgoorlie and BHP’s nickel sulphate processing plant in Kwinana.

Up until the end of 2020, Australia did not have any lithium conversion facilities operating to value-add to the spodumene concentrate produced in the country.

Figure 4 – Australia’s share of lithium mined

In 2021 this is expected to change. Albemarle and Mineral Resources are scheduled to commission a 50,000 tonnes per year lithium hydroxide plant at Kemerton in Western Australia and Tianqi Lithium will commission the first of two 24,000 tonnes per year of lithium hydroxide production lines in Kwinana. This will be followed

by Covalent Lithium, a joint venture between Wesfarmers and SQM of Chile, commissioning a 50,000 tonnes per year lithium hydroxide plant later this decade.

As a result, Roskill forecasts that by 2030, production of lithium chemicals in Australia will account for 11 per cent of world production.

The significant investments made into these processing facilities will be of huge benefit to the Australian economy and create additional jobs.

The continued success for Australia has strong links to the rest of the world. While Australia can mine and process minerals, it cannot operate in a vacuum. The relationships formed by the Australian Government with the United States, targeting the strategic exploration and sourcing of critical raw materials present opportunities to be highly beneficial to Australian companies.

The foundations for a relationship that extends into other minerals such as rare earth, nickel and cobalt has been formed and can be built upon.

In the future, a close relationship with Europe could provide great mutual advantages. The European Commission has outlined a pathway for an increasing electromobility, but Europe is lacking the raw materials needed to form a fully intra-Europe value chain, materials which are mined and processed in Australia and could be supplied to a fast-growing European market.

Resources mined and processed in Australia will be of increasing interest to the downstream value chain, not only for supply security by also because of sustainability. The ESG (environmental, social and government) credentials of Australian products are very strong.

The social laws and ethics in Australia ensure that workers are treated in humane ways with extensive rights. Government support and regulatory framework for miners are strong across the country. From an environmental point of view the strong credentials continue and will grow stronger as renewable energy increases in the overall energy mix.

Roskill’s team covers the whole supply chain from mine to market, with products looking specifically at the upstream and downstream, as well as detailed reports covering entire commodity chains. Roskill has recently opened offices in Australia with representation in both Perth and Sydney to ensure close collaboration with clients in the region. Roskill consultants and analysts are located across the world with key offices in Australia, Shanghai, London, South Africa, as well as in North and South America. * Lithium, nickel, cobalt and manganese relates to demand from rechargeable batteries only.

Source: Roskill.

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B AT T E R Y M E TA L S

A game-changing technology for battery marketplace Iggy Tan discusses Altech Chemicals’ expansion into the lithium-ion battery industry with an alumina nano layer coating technology it has developed.

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ltech Chemicals is to embed itself in Europe’s booming lithium-ion battery (LIB) industry through a high-tech nano application of its high purity alumina (HPA) technology.

Best known for its HPA production project in Malaysia targeted at the thermal separator LIB market and the more established markets of LED lights, semiconductor wafers and scratch-resistant glass, Altech now has its sights on the battery materials coating market.

Altech’s 75 per cent owned Germany subsidiary has started a prefeasibility study in to the construction of a battery materials HPA coating plant in Saxony.

The PFS is based on a phase one coating plant with the capacity to coat 10,000 tonnes per annum (tpa) of anode graphite, using Altech’s nano alumina coating technology.

Altech managing director Iggy Tan says that the HPA technology to coat graphite or silicon participles in battery anodes is “going to be game-changer for LIBs.’’ “Every new LIB loses 8-10 per cent of its lithium on its first charge. It goes to the anode side and it basically gets deactivated,” Tan says.

“It’s called the first cycle capacity loss and is a problem that the industry has been trying to solve for decades.

“What we have done is coat the graphite or silicon particles with a very thin layer of alumina of about two nanometres. And in our battery tests we have seen an immediate benefit.

“Essentially what we are doing is taking our HPA and going further downstream, using technology to apply straight into battery applications.”

Germany is a natural home for the proposed plant, with Tan saying Europe is the “new’’ lithium story.

“That’s driven by tough regulations on auto emissions. And Europe has said it will not be reliant on Asia for raw materials and battery manufacture,” Tan says.

Forecast graphite demand for anode production in Europe is more than 500,000 tpa, assuming all of the currently proposed LIB plants are built.

In settling on 10,000tpa in the PFS, Altech has taken a conservative approach

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Altech is targeting a high-tech nano application of its high purity alumina technology.

Altech plans to tap into the future demand for batteries used in EVs.

and assumed only half are built. That would mean the proposed Saxony plant will account for 4 per cent of Europe’s demand.

Tan says the coating plant’s HPA feedstock requirement will eventually be satisfied from Altech’s proposed Malaysian HPA plant where initial site preparation work has been completed, with project completion dependent on securing finance.

He says that by self-funding the early stage works, the project’s construction

start-up is significantly de-risked.

“We will have a running start when the financing comes through,” Tan says.

Because the Malaysian project is considered a “climate change project’’ for green bond financing purposes (it is 49 per cent less greenhouse intensive than existing HPA operations as it does not use aluminium metal as its feedstock), Altech is seeking a $US144 million ($186 million) listed green bond raising.

B AT T E R Y M E TA L S

Lithium-ion batteries – back to the future

BY ADR IAN GR IFFIN, M ANAGING DIR ECTOR OF LITHIUM AUSTR ALIA

Market dynamics are changing in the global battery industry as many developers return their focus to a traditional lithium-ion technology.

A modern take on a lithium-ion battery pack.

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AUSTRALIAN RESOURCES & INVESTMENT

T

he ground-breaking work of the 2019 joint Nobel Prize winners – Goodenough, Whittingham and Yoshino – paved the way for the first commercial lithium-ion battery (LIB).

Commercial development began with the founding of Sony-Eveready in 1975.

In February 1990, Sony unveiled the camcorder, which was released to the public in September of that year, along with mobile phones supported by lithium cobalt oxide (LCO) cells.

Since then, the LIB, which in those days was created largely for recreational applications, has morphed, chemically and physically, into an enabler of energy storage on a mighty scale and the global champion for portable power.

The LIB has afforded the planet an opportunity to decarbonise transport and power generation and, long-term, may well supply energy to the 600 million people worldwide who presently lack electricity and cannot connect to a grid.

Let us look at early development options for the LIB, how the technology has altered since its inception and where it is heading in the future.

P R E VA I L I N G L I B T E C H N O L O G I E S Three major research teams dominated LIB development in the 1980s, each focused on a different cathode crystal structure.

The common surviving technologies include the spinel structures – such as nickel cobalt manganese (NCM) and nickel cobalt aluminium (NCA) – and the olivine structures, including lithium ferro phosphate (LFP), patented by Goodenough et al in 1996.

As LIB technologies have matured, what was formerly a plethora of chemistries has been reduced to a handful of massproduced variants, and they too can be separated into the two classes mentioned above: the spinels (the nickel/cobalt – or Ni/Co – variants), and the olivines (LFP and related compounds).

THE LFP EDGE LFP provides a number of distinct advantages over the Ni/Co variants, among them lower cost, greater longevity, improved safety, a wider operatingtemperature range, minimal requirements for heating/cooling and the ability to fully charge and discharge (meaning less requirement for control by battery management systems).

In fact, LFP can be used as a direct replacement for lead-acid batteries with no

battery management system at all.

If that makes LFP sound like the ideal battery chemistry, what is the downside?

The fact that, in its standard form, LFP does have a lower energy density than competing Ni/Co cells.

That said, LFP has long been a staple in energy-storage applications in which the volume of the battery pack is of little consequence.

LFP has also been widely adopted as the LIB of choice for Chinese electric vehicles (EVs) due to its superior safety credentials, whereas in the western world, with its fixation on range anxiety, batteries with Ni/ Co spinel structures have been used in EVs. L F P – C O S T A D VA N TA G E Safety aside, cost considerations are becoming paramount as mass production of LIB cells underlines the financial benefits of LFP production compared to that of Ni/ Co batteries.

LFP is likely to be the first LIB chemistry to break the $US100/kWh (kilowatt hour), making the total cost of ownership of an EV cheaper than one powered by an internal combustion engine.

LFP – CIRCUMVENTING S U P P LY I S S U E S When choosing the type of LIB to use in EV applications, cost and safety are not the only considerations, given that the availability of some critical materials may be constrained by the ethics of supply.

Cobalt, for example, is often sourced from conflict zones – countries in which child labour and human-rights abuses are endemic – and is thus compromised in that regard.

With LFP, containing only one critical material, lithium, supply constraints are

fewer than for competing Ni/Co batteries ... and LFP requires 20 per cent less lithium per unit of stored energy than NCM LIBs. LFP is thus a far more sustainable option in terms of critical materials.

Finally, putting ethical considerations to one side, the pressure of demand for both cobalt and nickel is likely to run those markets into deficit within a decade.

LFP – BACK TO THE FUTUR E? As consumers become aware of the benefits of LFP, demand is rising rapidly. Tesla’s LFP-powered variants are being built in China and sold into the European market, and that company will soon offer its lowrange LFP vehicles globally.

Meanwhile, China’s BYD is going headto-head with Tesla in Europe, tempting buyers with luxury LFP-powered sedans.

VW, too, is embracing LFP, having indicated that all its entry-level EVs will be based on that LIB platform.

As these EV manufacturers move forward, others will follow. But it is not just about EVs. Telsa is going all-LFP for its energy-storage products, including its ‘Megapack’, designed for large-scale backup of renewable energy.

In the past, most LIB cells produced by BYD in China were used in the production of its own vehicles, but that is about to change.

Theoretically, BYD’s ‘Blade’ technology for EVs – a configuration of LFP battery cells that provides high pack density – can be incorporated as a structural component of any EV, thereby reducing that vehicle’s weight and improving its range (BYD cites a staggering 1000 kilometres per charge).

Once made available to original equipment manufacturers (OEMs), the technology will reduce battery-pack

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B AT T E R Y M E TA L S

manufacturing costs by increasing volumes and standardising machining.

No doubt the availability of a generic Blade pack will increase demand for LFP. Chinese-based battery manufacturer CATL is, with its Cell-to-Pack technology, pursuing a strategy similar to that of BYD – that of increasing energy density at pack level by improving battery-cell geometry.

L F P – M A N U FA C T U R I N G V O L U M E

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Last year, BYD announced an eightfold increase in its LFP output and plans to discontinue production of any LIB cells containing nickel and cobalt – in future, all BYD batteries will be LFP-based.

This year has already seen new highs in the volume of LFP produced. Chinese output in the March quarter was close to that of LFP production in 2020 in its entirety.

In fact, in March this year, China

produced more LFP than NCM – a first! Such is the expansion in demand and capacity for LFP that output for calendar 2021 is estimated to be as high as 350,000 tonnes.

The impact of all of this on the lithium chemical industry is clearly being felt, with demand for lithium carbonate rising disproportionately compared to that for lithium hydroxide. This has eroded the traditional hydroxide premium in the Chinese domestic market.

In some instances, prices for carbonate have exceeded those for hydroxide. Such a fundamental shift in battery chemistry demand could have a profound and longlasting effect on future refining capacity and the types of lithium chemicals produced.

It may even be that neither lithium hydroxide nor lithium carbonate become the dominant precursor for LFP. Whatever occurs, it does appear inevitable that LFP will be the LIB chemistry of choice sooner rather than later, and that it is likely to remain so for at least the medium term.

With many jurisdictions now taking a shine to LFP, supply shortages are bound to eventuate, given that less than 2 per cent of current demand is met from LFP production anywhere other than China, which consumes most of what it produces.

Western EV manufacturers must ensure security of supply, so the need for vastly increased LFP production capacity outside of China is obvious.

S H O R T E N I N G T H E S U P P LY C H A I N The production of LFP, as opposed to that of NCM or NCA, has environmental advantages beyond the applications for which it is used.

Current supply chains for NCM/NCA are complex, with most critical materials passing through China on their circuitous route from mine site to end-user.

As the supply chain for nickel-based LIBs matures and cell production decentralises, some shortening of the supply chain will occur; however, the primary sources of nickel and cobalt – that is, the mines themselves – cannot be relocated, so some complexities simply cannot be removed.

Supply chains for Ni/Co battery production therefore remain unavoidably complex and the geological, geographical and geopolitical risks associated with sourcing such critical materials increase the probability of supply chain disruption and price volatility.

LFP requires no nickel or cobalt, only lithium. Reducing the number of critical

AUSTRALIAN RESOURCES & INVESTMENT

the LFP chemistry to produce lithium manganese ferro phosphate (LMFP).

Because LMFP also crystalises in the olivine configuration, the superior attributes of LFP – low cost, safety, longevity, etc – are preserved; however, energy density is increased by around 25 per cent. VSPC-produced LMFP will be available for commercial testing from mid2021.

materials used in battery manufacture from three to one, simplifies the logistics chain and transport required to generate the final product – the LFP LIB. This in turn reduces the emissions profile of the finished goods, a boon for the environment.

Also, because LFP incorporates iron and phosphorous, commodities that are widely available, it is possible to further simplify logistics in a way not possible with NCM/ NCA. If lithium concentrates can be converted to lithium chemicals in refineries located closer to the actual mine sites that produce the lithium, then supply chain efficiencies will render obsolete the current practice of moving spodumene concentrates halfway around the world before converting them to lithium chemicals.

Historically, supply chains for LFP LIBs have been almost monopolistically Chinacentric but still far simpler than those for nickel-based LIBs. Because LFP supply chains experience less price and supply volatility, this battery

chemistry has the potential to be far more compliant from an environment, social and governance (ESG) point of view than any other LIB option.

L I T H I U M AU S T R A L I A P L A N S LFP PRODUCTION Lithium Australia subsidiary VSPC Ltd produces advanced LFP cathode powders at its pilot facility in Brisbane, Queensland.

Recently, VSPC completed a prefeasibility study that demonstrated the viability of LFP production using its proprietary processing technology.

The base case for the production of 10,000 tonnes per annum of LFP has an estimated capital cost of $US113 million, resulting in a net present value (NPV) of $US253 million, an internal rate of return (IRR) of 33 per cent and an annual free cashflow of $US56 million.

VSPC is currently working to improve the energy density of LFP, to bring it more in line with NCM at a cellular level. It is achieving this by adding manganese to

A DIRECT ROUTE FROM SPODUMENE TO C AT H O D E P O W D E R Proprietary technologies developed by Lithium Australia include its LieNA process, designed to recover lithium from the fine or low-grade spodumene (the principal hardrock source of lithium) usually consigned to tailings when lithium concentrates are produced as feed for conventional convertors.

A caustic conversion process, LieNA has no roasting phase and, importantly, provides the option of producing lithium carbonate, lithium hydroxide or lithium phosphate.

Lithium phosphate is ideal feed for the production of LFP, since it delivers the lithium and the phosphorous required in a single reagent.

Together, LieNA and VSPC’s advanced cathode-powder production technology can create a direct route from spodumene to LFP, eliminating the need to produce lithium hydroxide or carbonate. With the length of the battery supply chain further reduced, economic and environmental benefits will ensue.

CONCLUSION One of the longest established variants of the LIB but largely sidelined until now, LFP has avoided extinction thanks to its popularity in China.

Now this battery type is rising like a phoenix from the ashes to take on the world. Indeed, pundits predict that LFP will be the dominant LIB type globally in the very near future.

LFP provides an opportunity to overhaul the battery supply chain by reducing risks and costs, as well as the industry’s environmental footprint.

That said, improving supply chain security requires extensive expansion of LFP production capacity outside of China.

Lithium Australia plans to establish such an alternative supply chain while simultaneously reducing the number of steps from mine gates to the production of energy-efficient passenger vehicles.

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B AT T E R Y M E TA L S

Drilling at Lake Resources’ Kachi lithium project in Argentina.

Powering up: Battery metals get Biden bolt

BY ANTHONY FENSOM

Optimism has been high for battery metals companies so far this year as market conditions have moved in their favour.

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attery metal prices have powered ahead in 2021, energised by the Biden Administration’s electric vehicle (EV) spending plans and global drive towards ‘net zero’ emissions.

With analysts pointing to looming deficits for key battery metals, the sector is enjoying being back in the limelight among investors and policymakers.

On February 24, newly elected United States President Joe Biden signed an executive order aimed at securing America’s “critical” supply chains, including critical minerals and clean energy technology.

Biden’s $US2 trillion ($2.6 trillion) infrastructure plan includes around $US175 billion to stimulate the EV industry, including manufacturing and purchasing, with analysts suggesting it could trigger a “green tidal wave” of investment.

US automakers have backed the policy shift, with General Motors announcing plans to go “all electric” by 2035 and Ford launching $US22 billion worth of EV investments.

The action has not been limited to the United States, however. “Net zero” plans by Canada, the European Union and Asian nations such as China and Japan have put the spotlight on transport emissions, with EVs considered a key part of the solution.

In Europe, Volkswagen announced at its Tesla-style ‘Power Day’ on

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March 15 it would build six battery gigafactories by 2030, with a total production capacity of 240 gigawatt hours (GWh).

Notably, VW’s planned gigafactories would consume around 200,000 tonnes of lithium carbonate equivalent (LCE), or two-thirds of the world’s total production last year.

Its planned production capacity would also exceed the industry’s total output of 215 GWh, according to analysts Benchmark Mineral Intelligence (BMI).

As of March, BMI estimated some 208 battery ‘gigafactories’ were in the pipeline through to 2030, up from 181 last year. Total capacity is expected to reach 3.4 terawatt hours by 2030, up from 755 gigawatt hours in 2020.

The impact on battery metals demand will be significant. BMI expects the gigafactories will consume 3 million tonnes per annum of lithium, 4 million tonnes of graphite anode, 2 million tonnes of nickel and around half a million tonnes of cobalt and manganese. Copper will also benefit, since EVs use around four times as much copper as petrolbased cars.

RECESSION-PROOF EV sales have proven resilient to the economic downturn caused by

AUSTRALIAN RESOURCES & INVESTMENT

COVID-19, according to the International Energy Agency (IEA).

In its Global EV Outlook 2021 report, the Paris-based organisation reported there were 10 million EVs on the world’s roads at the end of 2020. EV registrations rose by 41 per cent last year, particularly in Europe and China, despite global car sales declining by 6 per cent.

Automakers stepped up too, launching 370 EV models in 2020, up 40 per cent from 2019.

Despite being hit by the COVID-induced global recession, consumer spending on EVs reached $US120 billion in 2020, up 50 per cent from the previous year. EV sales have continued to rise in 2021, up 140 per cent in the first quarter.

Under current policy settings, the IEA sees total EV sales reaching 145 million in 2030, accounting for 7 per cent of the world’s road vehicle fleet.

However, should governments take stronger actions to curb emissions, the global EV fleet could reach 230 million by 2030.

PRICE RISES Battery metal prices have surged in 2021 amid growing projections of supply shortages.

In mid-March, BMI reported that technicalgrade lithium carbonate prices had risen by 114 per cent since the start of the year, with battery-grade material up 103 per cent.

Adding to the bullish outlook, Macquarie analysts have projected the overall lithium market will be in deficit from 2022.

Already the world’s biggest exporter of spodumene (lithium), Australia’s battery metals

sector has been buoyed by the upturn. Production is being increased at mines in Western Australia such as Greenbushes and Mt Cattlin, together with new merger and acquisition activity and downstream investments.

On April 19, ASX-listed Orocobre and Galaxy Resources announced a $4 billion “merger of equals,” creating the world’s fifth largest lithium producer with operations in Argentina and WA. In the same month, IGO said work was set to resume on the completion of Australia’s first lithium hydroxide plant at Kwinana, WA. Battery ‘gigafactories’ have also been proposed near Newcastle and Townsville.

Steve Promnitz, managing director of ‘clean lithium’ company Lake Resources, sees the upturn as vindication of the company’s strategy.

“The EV revolution is going global and demand for battery-grade lithium is ramping up exponentially. The timing is perfect for Lake, as we have already demonstrated our ability to produce a high purity product on a sustainable basis through direct extraction technology, with the ability to scale up production to meet demand,” he says.

Brett Lynch, managing director of Quebecfocused Sayona Mining, sees particular benefits in North America’s battery expansion.

In January, the company announced a strategic partnership with Piedmont Lithium, which will see half of Sayona’s output supplied to Piedmont’s base in North Carolina.

“North America is seeking local supply sources of key battery metals and there’s none better than Quebec, which has environmentally sustainable, affordable hydropower, world-class infrastructure and proximity to key battery markets,” Lynch says.

Should Sayona’s proposed acquisition of the North American Lithium mine in Quebec prove successful, the company could join leading producers in North America, with plans to go downstream and produce a ‘clean and green’ lithium hydroxide product.

In addition to lithium miners, other metals could also receive a boost from the electrification trend.

Research by Argentina’s National University of Cordoba has suggested tin could provide a significant boost to silicon performance, confirming its potential for use in lithium-ion batteries.

Elementos chief executive officer Joe David says the new research is just another factor driving increased demand for the silvery metal.

“Tin is already heading for a supply deficit and this research shows there could be additional demand coming from the EV revolution. For emerging producers such as Elementos, it gives us even more motivation to advance our projects into production,” he says.

From copper to lithium, nickel and tin, Australia’s miners are hitting the accelerator as the world’s clean energy drive shifts up a gear.

The effects could be long lasting, whether at home or abroad, for the nation’s innovative resources sector.

Lake Resources MD Steve Promnitz.

Elementos CEO Joe David.

Sayona Mining MD Brett Lynch.

– 39 –

B AT T E R Y M E TA L S

Electrifying operations to close the mining loop The Electric Mine Consortium has been launched, featuring mining companies which plan to mine the battery metals of the future and then use the clean energy mining machines manufactured with these commodities.

D

emand for battery metals is expected to spike significantly during the next decade as the uptake of electric vehicles (EVs) increases.

It is not only on public roads where electrification will be prominent, but also in the mining industry which is moving towards using cleaner energy to decarbonise operations.

Electrification has been hailed for its potential to strengthen the mining sector’s licence to operate and improve project economics in the coming years.

According to a survey of mining executives undertaken by research group State of Play, 87 per cent believe that all existing mine sites will become fully electric within 20 years and 60 per cent believe the next generation of greenfield mines will be fully electric.

Electrification presents an opportunity to completely remove diesel from mines, cut carbon emissions, reduce exposure to volatile oil prices and eliminate worker exposure to diesel particulates.

However, when and how mining companies make investments in batteryelectric equipment remains a work in progress, particularly in Australia.

Uptake of battery-electric equipment in Australian mining has, so far, been slow because of the class of available machinery not being suited to the country’s large-scale

– 40 –

mines and the significant up-front costs that are currently involved.

But the enthusiasm to go electric is evidently there, as demonstrated by the launch of the Electric Mine Consortium in March.

The State of Play-led Consortium involves 14 companies, including South32, OZ Minerals, IGO and Gold Fields, all of which signed a statement of intent to electrify their mines with the goal of accelerating change in the industry.

For these mining companies, electrification means they would not only be mining the commodities that enable this transition, but also using the machines made from the type of products they mine.

IGO is on track to achieve just that at the Nova underground nickel-copper-cobalt mine in Western Australia.

The Perth-based company has aligned itself to become a relevant supplier of metals that are critical to energy storage and renewable energy.

It is also exploring opportunities for battery-electric equipment at Nova, partnering with fellow Consortium member Safescape to trial the Bortana light mining vehicles at the site.

Mining contractor Barminco, another Consortium member, collaborated with IGO at Nova to implement the trial, and found that zero emissions allow more vehicles to be in a

single area at the site, increasing productivity.

IGO chief operating officer Matt Dusci believes light battery vehicles are at a point of maturity where they are set for mass adoption within the industry.

He says a pre-feasibility study on the electrification of Nova also revealed that if IGO commenced development of the operation today, the technology would be “reliable, safe and cost effective enough” to develop an allelectric mine.

“Our study illustrated both a capital and operating savings over the life-of-mine, coupled with the emissions reduction,” Dusci says.

“We are committed to decarbonisation and excited about bringing new technology into our mines of the future.”

Original equipment manufacturers (OEMs) Epiroc and Sandvik, as well as Dassault, Horizon Power, Hahn Electric, Energy Vault and 3ME Technologies are others that have joined the Consortium.

In recent years, Epiroc has focused on designing zero-emission underground loaders, trucks and drill rigs, as well as technologies and packages that will enable the transition.

Epiroc business line manager Shaiful Ali says the company will seek battery-powered options for its full fleet of vehicles in the long-term.

However, he takes note of the status quo

AUSTRALIAN RESOURCES & INVESTMENT

Epiroc’s Scooptram ST14 Battery, Boomer E2 Battery and Minetruck MT42 Battery machines.

in Australian mining when it comes to this transition.

“A lot of the Australian mines are large and suit a bigger class of machines,” he says.

“Short term, I think diesel will be around because the evolution of the battery is not there yet. But in the long term, yes, we will also look at battery options for our full fleet of machines.”

To help overcome the costs involved with moving electric, Epiroc has established the Batteries as a Service solution, which gives the OEM ownership of the batteries being used on its underground machinery.

Investment in battery-electric machines has been known to be around double that of diesel models in the past. With Batteries as a Service, however, the initial capital outlay is reduced significantly as Epiroc oversees the life of the batteries.

“The biggest issue we faced was the cost, but I think with the recent introduction of Batteries as a Service, it gives the confidence that the upfront cost is not as damaging as once thought,” Ali says.

“The Batteries as a Service solution allows control and management of all batteries on site to be put into the hands of Epiroc, including maintenance and upgrades, allowing for a hassle-free approach towards electrifying a mine.”

State of Play report co-founder Graeme

Stanway reinforces the cost and investment challenges that mining faces when it comes to electrification.

He says while the industry understands the benefits of electrification, when it comes to individually implementing them as an organisation, cost becomes a key hurdle.

“Our data shows renewables, all electric systems and batteries will help fuel the change towards a healthier, economically viable future of mining, but uncertainty remains when it comes to which area to invest in first, and how,” Stanway says.

But collaboration through an initiative like the Electric Mine Consortium might just be the answer to sparking change.

The State of Play survey found that the CEOs agree there should be more focus on collaboration to overcome cost barriers and uncertainty in technology choices that may be beyond the capacity of individual companies alone.

Industry growth centre METS Ignited is supporting the Electric Mine Consortium by helping develop deeper industry links between miners and vendors.

METS Ignited chief executive officer Adrian Beer says the Consortium will encourage industry collaboration, allowing for a new marketplace of solutions to address industry challenges.

“By aggregating together with their mine

needs, it creates a meaningful marketplace to attract new and existing vendors, more importantly investors,” Beer says.

“The traditional approach in the mining sector around issues of safety and sustainability is often to work with research to find new ways to do things or try to improve processes, optimise or bring efficiency. They tend to be case-by-case solutions.

“The Consortium has aggregated demands across the sector so that technology companies and investors can access a marketplace for a new set of solutions to address industry challenges.”

With IGO already heavily invested in green energy, the company hopes to promote broader industry change by collaborating with industry through the Consortium.

Dusci says the Electric Mine Consortium will help decarbonisation materialise.

“The Electric Mine Consortium offers IGO the opportunity to collaborate with likeminded companies focused on accelerating this drive to electrification,” he says.

“IGO will continue to have our own individual goals for emissions and electrification; however, the Consortium offers the platform for collaboration and the sharing of learnings and ideas.”

Extracts from this article first appeared in Australian Mining and Safe to Work magazine, both titles at Prime Creative Media.

– 41 –

B AT T E R Y M E TA L S

Australia makes critical moves as mineral supplier A

Is Australia positioned to become a leading global supplier of critical minerals over the next decade?

s the world’s leading developed nations set up their critical minerals supply chains, the Australia Government has established a strategy to fortify the country’s place as a key supplier.

Released in March, The Australian Government’s Resources Technology and Critical Minerals Processing Road Map is broken into two, five and 10-year goals for Australia’s metals industry to achieve this.

As manufacturing of renewable energy technologies ramps up, Australia’s rich critical minerals reserves have elevated the potential the country holds to become a dominant force in the critical minerals supply chain.

For example, Australia is the world’s top producer of lithium, rutile and the second largest producer of zircon and rare earth elements.

The critical minerals fervour is also growing internationally in countries such as the United States, with President Joe Biden signing an executive order in February to deliver a 100-day review of four key areas, including large-capacity batteries and critical minerals supply chains.

Biden has indicated that the US plans to move suppliers out of countries such as China and back onto its home shores or to allied countries, leaving Australia in a position to capitalise.

Federal Minister for Resources, Water and Northern Australia Keith Pitt says Australia has the potential to grow its role in the critical minerals global supply chain.

“There is growing recognition among like-minded countries about the need for more diverse global supply chains,” Pitt says.

“Our world-leading mining expertise, proximity to manufacturing powerhouses such as Japan and Korea, and our position as a trusted trading and strategic partner with rapidly growing markets in the US and Europe positions us well compared to other nations.

“Australia is one of the most technically advanced, innovative and efficient resource producers in the world with a skilled workforce, stable investment climate, supportive government incentives and high environmental standards.”

The Australian Government last year established its Critical Minerals Facilitation Office to grow the sector further.

Resources technology and critical minerals are also listed as the top priority in the Australian Government’s $1.3 billion Modern Manufacturing Initiative and National Manufacturing Priorities.

Pitt says the government recognises that mechanisms such as the Roadmap and the Modern Manufacturing Initiative demonstrate strong support for the critical minerals sector.

“Along with our close engagement with partner countries, these

– 42 –

initiatives position Australia as a reliable and secure international supplier of critical minerals for the world,” Pitt says.

And while the Road Map’s plan is 10 years in the making, Pitt believes Australia’s role in the global critical minerals supply chain could evolve into downstream processing.

He says Australia has world-leading expertise in resource extraction and processing, high-tech engineering and renewables research.

“Drawing on our expertise in minerals processing, there is also an opportunity for Australian industry to move into downstream processing,” Pitt says.

“Developing processing capabilities outside of concentrated supply chains will be a crucial step in diversifying supply and establishing secure supply chains; and increased domestic processing will also help Australia capture more value from its critical minerals resources.”

Lynas Rare Earths is an established Australian producer of rare earths that is kick starting the government’s ambitions outlined in the Road Map. The company is currently the only producer of separated rare earths outside of China and is the second largest worldwide, with its rare earths sourced from the Mt Weld mine in Western Australia.

To strengthen its international presence, Lynas secured an agreement with the United States Department of Defense to build a light rare earths separation plant in Texas to bolster the country’s local rare earths supply chain.

Lynas chief executive officer and managing director Amanda Lacaze says developing cost competitive operations, which will require government support, is a key way to establish Australia’s critical minerals projects in global supply chains.

“Government support, including for the development of costeffective infrastructure will be essential to developing this cost competitive position,” Lacaze says.

“We have an exceptional opportunity for Australia to become a reliable supplier of critical minerals, as Lynas has done in the global rare earths supply chain.”

Rare earths did not suffer the full force of the COVID-19 pandemic like other commodities, with the market remaining well positioned due to increasing EV demand in Europe and Asia.

Lacaze believes COVID-19 sharpened the focus of government and manufacturers around the world on diverse and sustainable supply chains for critical materials.

“While they are used in small quantities, many modern technologies cannot be made without critical minerals such as rare earths and we are seeing more government action on critical minerals

AUSTRALIAN RESOURCES & INVESTMENT

Lynas’ Mt Weld rare earths mine.

than ever before, including tangible actions and significant investment,” Lacaze says.

“The Australian Government’s Modern Manufacturing Initiative highlights the importance of resources technology and critical minerals processing to the development of modern manufacturing capability in Australia and in key allied jurisdictions.”

Cobalt Blue, an aspiring critical minerals producer at the Broken Hill cobalt project in New South Wales, has been recognised by the Australian Government for its potential.

Austrade last year named the Broken Hill project in its Australian Critical Minerals Prospectus 2020, the only cobalt project to make the list.

Cobalt Blue chief executive Joe Kaderavek expects the prospectus to put Broken Hill on the global stage, allowing investors and off-takers to engage with the project.

“Cobalt Blue applauds the proactive approach initiated by the federal government in facilitating investment interest in critical minerals development and processing in Australia,” Kaderavek says.

While cobalt is not publicly traded, Cobalt Blue’s analysis of the critical mineral expects demand to grow by 400,000 tonnes by 2030 compared with 140,000 tonnes in 2021.

“The majority of that growth is driven by electric vehicle and energy storage system battery needs,” Kaderavek explains.

“These numbers also assume a significant ‘thrifting’ or lowering of cobalt content in the battery as technologies progress, nevertheless, the demand growth remains overwhelming.”

While cobalt may not be the most prolific critical mineral in Australia’s arsenal, it remains an aspect

Lynas is the second largest producer of rare earths materials globally.

of the country’s Roadmap towards being a key supplier to the world over the next decade.

As Kaderavek adds, the initial steps taken by the US are a positive sign for the direction Australia has moved with the strategy.

“Building up US supply chains would not mean it is going it alone, but would see global logistics alliances built as part of the efforts to address weaknesses overall,” he continues.

“As we have already seen, the US Government is willing to incentivise supply into its production into its domestic supply chains, and we look forward to such possible outcomes.”

Extracts from this article first appeared in Australian Mining magazine, a Prime Creative Media publication.

– 43 –

NICKEL

Discovery builds Mt Alexander prospects St George Mining has found what it has been looking for at the Mt Alexander project with a major discovery at the site during April.

T

he big-time potential of St George’s Mt Alexander nickel-copper project in Western Australia has been enhanced by the discovery of high-grade mineralisation at depth.

St George reported in mid-April that drill hole MAD199 had returned a 10.96-metre interval of nickel-copper sulphides from a 333.6-metre downhole while testing an electromagnetic (EM) conductor.

The result (assays were pending) was the deepest occurrence of massive nickel-copper sulphides drilled along the Cathedrals Belt at Mt Alexander, and was also the most western occurrence.

St George executive chairman John Prineas says MAD199 has confirmed the prospectivity of the Cathedrals Belt for further high-grade mineralisation, particularly at depth and to the west.

“Hopefully we are getting close to finding the big prize,’’ Prineas tells Australian Resources & Investment.

He explains that previous exploration along the Cathedrals Belt discovered

Diamond drilling at the Mt Alexander site.

– 44 –

Drill core from St George’s discovery at MAD199.

We know this intrusive system goes for at least 5.5 kilometres across the Cathedrals Belt, so we have got a fantastic target horizon to keep chasing and finding more mineralisation. shallow deposits across a strike length of 5.5 kilometres.

“It’s high grade nickel, copper, cobalt and platinum group metals. It is wonderful stuff starting 30 metres below surface,” Prineas says. “But they are relatively small. While we are still confident that we can monetise those because they are shallow and will involve low capital expenditure, the real prize has been to find bigger deposits at depth.

“That’s what we have been doing for the past 12 months. MAD199 was a breakthrough because it hit high-grade nickel and copper at depth.”

Prineas says MAD199 has confirmed the concept that St George has been chasing – high grade mineralisation at depth.

“We know this intrusive system goes for at least 5.5 kilometres across the Cathedrals Belt, so we have got a fantastic target horizon to keep chasing and finding more mineralisation,’’ Prineas says.

The deep conductor tested by hole MAD199 was identified by downhole EM (DHEM) survey work, with DHEM taking drill targeting on the

Cathedrals Belt beyond the 300-metre depth possible with surface-based EM surveys.

“EM is a wonderful tool to find nickel sulphides. But from surface, its effectiveness is limited,” Prineas says.

“Finding the deeper stuff is a bit trickier.

We know that we have pretty much screened the top 300 metres and know what is there, and what’s not there.’’

“But at depth, you really have to drill and conduct DHEM to light up the conductive targets. That is exactly how we found the MAD199 (conductor) section.”

Prineas says the Mt Alexander mineralisation is a rare combination of nickel, copper, cobalt and platinum group metals not seen elsewhere in Australia.

While chasing down the big-time potential of Mt Alexander remains the company’s main focus, St George also has a drilling campaign planned in May/June on tenements it picked up 12 months ago in the Paterson Province of WA – home to the recent copper/gold discoveries at Winu (Rio Tinto) and Havieron (Newcrest/Greatland Gold).

ST GEORGE MINING

is making WA’s next big nickel discoveries

Mt Alexander Project: High Grade Nickel Copper Sulphide Discovery High grade nickel-copper-cobalt-PGE sulphide mineralisation commences 30m from surface

High impact drilling campaign underway Quality exploration team with track record of success in discovery of gold and massive nickel sulphide deposits Strong investor backing supports St George’s exploration model ST GEORGE MINING LIMITED | ACN 139 308 973

stgm.com.au

NICKEL

Black Swan to benefit from future nickel demand Peter Harold highlights how Poseidon Nickel intends to take advantage of a strong nickel market through development of its flagship Western Australian project.

P

oseidon Nickel is itching to capitalise on bumper nickel prices by fast-tracking its highgrade Golden Swan discovery at its Black Swan project into production.

“We are on our way to making a go-ahead decision by the end of this year, which means we could be producing by the middle of next year,’’ Poseidon managing director Peter Harold says.

The push towards development comes as nickel prices have surged 25 per cent from an average of $US6.26/pound in 2020 to $US7.90/pound (as of endApril 2021).

“We’re pretty much back to $US8/pound after having a bit of a pullback on plans in Indonesia to begin nickel matte for the battery materials sector from nickel pig iron,” Harold says.

“But the market has absorbed that and decided that the market is still going to need a lot more nickel for the electric vehicle revolution.

“Nickel matte from pig iron is going to meet some of the demand, but certainly not all of it. So I get the sense that the thematic driving the nickel price has not changed.”

Golden Swan was discovered in 2020. The drilling of an electromagnetic anomaly, adjacent to the neighbouring Silver Swan deposit at Black Swan, was a first drill hole success – 23.1 metres grading 4 per cent nickel and 0.4 per cent copper.

Getting it in to production next year will break a 10-year hiatus in production from the Black Swan project.

Ahead of a go-ahead decision, Poseidon is to

– 46 –

A Webdrill rig conducts resource drilling of Black Swan.

undertaking a resource drill-out of the Golden Swan mineralisation to allow a maiden resource estimate.

“The drilling is going to take about three months, so come the end of July we will give the results to the mining engineers to come up with a mine plan,’’ Harold says.

The resource drilling follows the April completion of a 465-metre drill drive – it can double as a production decline next year – from the existing Silver Swan decline out to Golden Swan.

Harold says two rigs in the drive will drill 13,000 metres in the resource definition program.

The development of the drive, and the drilling program, represents a $10 million commitment, reflecting the company’s confidence that Golden Swan will underpin Black Swan’s return to sulphide nickel production.

Harold says the underground drilling platforms provided by the drive are ideal locations from which to explore the highly prospective Southern Terrace at Black Swan.

Summing up, Harold says Poseidon investors can expect a steady flow of news as 2021 unfolds, leading to a final investment decision by the board on Golden Swan’s development by the end of the year.

“Assuming all goes according to plan, it means we will be generating revenue by mid-2022,” he says.

In addition to what comes from maiden resource estimate at Golden Swan, Poseidon holds a combined nickel resource of 395,000 tonnes across Black Swan, the Lake Johnston project, and the historic Mt Windarra asset.

Poseidon MD Peter Harold.

Western Australia

Black Swan Project Golden Swan High Grade & Southern Terrace Prospectivity

MT WINDARRA

Kalgoorlie Perth

LAKE JOHNSTON Esperance

Golden Swan & Southern Terrace Next Steps

Progressing Toward Production In 2022

Key Deliverables for 2021 Black Swan • • •

Deliver maiden Golden Swan Resource and Reserve, finalise offtake and financing, FID by December 2021 or earlier Continue to drill test the Southern Terrace Convert more Silver Swan Resource into Reserve

Mt Windarra • •

Study option of trucking ore to Black Swan Complete gold tailings BFS and monetise asset

Lake Johnston • •

Review and prioritise all exploration targets Determine optimum pathway for this asset

*Contained Ni metal 1 Refer Mineral Resource Statement attached Table 2 2 Refer ASX Announcement “Robust PFS completed for Windarra Gold tailings Project” dated 22 June 2020 3 Refer ASX Announcement “Poseidon to acquire rights to treat Lancefield gold tailings” dated 17 August 2020

BLACK SWAN SILVER SWAN

NICKEL

INDUSTRY 5.0: METAL ADDITIVE MANUFACTURING AND NICKEL

BY VLADIMIR PASER IN, CONSULTANT TO THE NICKEL INSTITUTE, AND GARY COATES, NICKEL INSTITUTE.

W

hile we are still in the midst of Industry 4.0 (smart manufacturing via integration of artificial intelligence, cloud computing, justin-time manufacturing and the Internet of Things), the term Industry 5.0 or its Japanese variant Society 5.0, is gradually gaining in popularity.

The basic principle behind the fourth industrial revolution recognises that by linking production equipment, intelligent monitoring and control devices, as well as real-time, internet-based connection to customers, manufacturers are creating smart networks throughout the supply and value chains.

In the upcoming stage of this development, the return of direct human involvement is envisioned to provide the next level of sophistication, responsiveness and relevance to meet the evolving human needs – hence the term Society 5.0.

Closer integration of the production systems and participation of humans in their operation and guidance merges the highspeed accuracy of industrial automation with the cognitive, critical and intuitive creative skills of humans.

The concept of Society 5.0 has been promoted by the Japanese Government since about 2015 – an idea which places the society as a whole at the centre of technology development, rather than the industry.

Giving technology the role of a catalyst and a driver, Society 5.0 aims at the general welfare of the members of the society and strives towards building a super-intelligent society-technology ecosystem. Society 5.0 takes Industry 4.0 and places the human being at its centre.

HOW DO THESE DE VELOPMENTS I M PAC T T H E P R O D U C T I O N A N D U S E O F M E TA L S , A N D N I C K E L I N PA R T I C U L A R ?

Let’s look at this topic with a brief overview of the latest trends in manufacturing technology, with particular emphasis on additive manufacturing (AM, or 3D printing) with metals (Metal AM).

Metal AM is a rapidly growing field

– 48 –

Figure 1 – 5cm diameter impeller in stainless steel alloy 17-4PH (UNS S17400).

catalysing a revolution in modern manufacturing. The most common approach involves the use of metal powders as feedstock material and laser sintering to assemble, layer-by-layer, 3D objects.

The laser process involves heating particles to the melting point of the given metal (~1,500 °C for nickel-containing steels) to fuse or ‘weld’ the particles, and careful selection of the laser beam control parameters (power, laser beam spot size, beam scanning pattern among many others) to produce a fully dense object, such as in Figure 1.

Various other approaches involve different energy delivery methods, including electron beam, ultrasound, kinetic energy (cold spray), electric/plasma arc, and extrusion or material jetting of metal-polymer composites (such as metal powder-containing filaments), followed by conventional debinding and sintering processes.

Figure 2 is a high-level, stage-ofdevelopment map (industrialisation vs. technology maturity index), showing that the most advanced deposition processes on both scales are the laser beam powder-bed fusion (LB-PBF), powder laser deposition (also known as powder-fed, or Directed Energy Deposition process), electron beam, electric/ plasma arc and wire-based electron beam deposition processes.

Filament FDM (fused deposition modelling with metal powder-containing filaments) and binder jetting are rapidly approaching the same mature territory.

Figure 3 shows a more detailed list of the

various Metal AM techniques. Judging by the number of players, laser beam powder bed fusion is clearly the dominant approach in Metal AM today.

Forming 3D objects layer-by-layer is not a foreign concept in the nickel industry. This is exactly how carbonyl nickel and ferronickel pellets are made, utilising chemical vapor deposition from iron pentacarbonyl, Fe(CO)5 and nickel tetracarbonyl, Ni(CO)4,

Figure 2 – Technology and industrial maturity index of different Metal AM technologies.

AUSTRALIAN RESOURCES & INVESTMENT

discovered by Ludwig Mond in late 1800s.

Figure 4 shows a cross- section image of a ferronickel pellet, revealing alternating layered structure of Ni- and Fe-rich layers.

The individual layers form a regular pattern.

The pellets are at a uniform temperature and the deposition of each layer takes place on all pellet surfaces simultaneously within the reactor.

Owing to the differences in nickel and iron carbonyl properties, the decomposition of each takes place preferentially within certain reactor space, resulting in the segregation of Ni and Fe-rich layers.

One can easily envision selected area deposition if the energy is supplied by a precise laser beam, writing a 3D nickel object (Figure 5).

The development of such vapor-phase Metal AM techniques is still in a laboratory stage. As of 2020, the dominant metals used in Metal AM are titanium, stainless steel, tool steels, aluminium, and nickel-based superalloys.

In addition to the nickel content in stainless steels, the nickel alloys play an important role in aerospace, tools production and other demanding applications, positioning nickel as an important component of high-value, additively printed metal parts.

While the total volume of metal powders used as feed materials in Metal AM printers is very small compared to the conventional metal forming techniques (~3000 tonnes of all combined metal powders in 2020), the rapid growth of Metal AM is expected to persist and nickel will continue to play a key role in many applications.

3D printing of nickel superalloys is a particularly active area of research, owing to the high potential in application areas such as aerospace and tooling.

The rapid growth of Metal AM continues to evolve and has the potential to become one of the most revolutionary technologies in metalworking.

Aerospace, usually one of the earliest adopters of novel technologies, has been leading the applications development

Figure 3 – Technology overview Metal Additive Manufacturing: Over 18 different metal 3D printing processes are known. Ampower Insights provide an overview and classification of the most important procedures.

3D printing of nickel superalloys is a particularly active area of research, owing to the high potential in application areas such as aerospace and tooling. along with tooling and the medical market segment.

Significant challenges that remain include safety (working with metal particulates) and regulations, limited production volumes due to process inefficiencies, equipment size constraints and long build-times, limited availability of economical metal powders, the need to

develop best practices, specifications, and standards for acceptance by various industry segments.

Nickel is bound to be one of the dominant participants among this new category of metallic feed materials, driving the development of high-performance parts in the next generation products in a variety of industries.

Laser beam

Niseed

E=hv

Precursor FeNi-layers with ring structure

Pyrolytic E=cT

Figure 4 – Layered structure of ferronickel pellets (dark colour=Ni-rich, light colour=iron-rich).

Deposit

Figure 5 – Laser beam guided selective area deposition from vapor phase metal precursor.

Substrate

– 49 –

B A S E M E TA L S

Rumble’s discovery excited the market with its Tier 1 potential.

Project pipeline puts Rumble in position Shane Sikora explains why Rumble Resources is well placed to advance a significant discovery the company made in Western Australia.

R

umble Resources’ strategy of systematically advancing a pipeline of exploration projects considered capable of hosting world-class discoveries has delivered a major zinc-lead discovery north of Wiluna in Western Australia.

The Earaheedy discovery was announced in April and prompted an immediate celebration in Rumble’s share price on the basis that the find has large scale Tier 1 potential – something Rumble has now set out to confirm.

Rumble’s “pipeline of projects’’ strategy involves building an active portfolio of projects with large-scale discovery potential and keeping them under critical review.

Those that do not stack up are rolled out and replaced with fresh opportunities.

Critical to the strategy is the negotiation of low-cost upfront optionality to enter projects, and the fast-track generation of first order drill targets, with the level of drilling success determining whether Rumble stays or goes.

Earaheedy, 110 kilometres north of Wiluna, came through that system, and Rumble has another six in the pipeline at various stages of evaluation across base metals and gold.

Rumble managing director Shane Sikora

– 50 –

says Earaheedy has validated Rumble’s pipeline of projects strategy.

“It is a strategy we follow to give us the best chance of making a major discovery and that’s what we’ve done at Earaheedy. What’s great is that we have got a whole series of other projects coming through the pipeline,” Sikora says.

“Earaheedy has obviously taken off now but the others offer a high chance of success as well.”

Results from two holes fast tracked for assaying from a 26-hole drilling program at the Chinook prospect at Earaheedy included 34 metres grading 4.22 per cent zinc-lead from 66 metres, including 17 metres grading 6.65 per cent zinc-lead from 73 metres in one drill hole, and 21 metres grading 4.31 per cent zinc-lead from 61 metres, including 10 metres grading 5.02 per cent zinc-lead from 67 metres in the second hole.

All 26 holes intersected visual zinclead mineralisation, with assays from the remaining 24 holes to be released on receipt.

The pre-drill “exploration target” at Earaheedy project was for between 40 to 100 million tonnes at a grade ranging between 3.5 per cent and 4.5 per cent zinc-lead at a relatively shallow depth (50-150 metres) along the extensive strike length.

“Our goal is to the upper end of that exploration target,” Sikora says. “To do that we need to invest money in to scoping out this discovery.’’

To that end, Rumble raised $40 million from a placement in late April at 50 cents a share compared with the company’s prediscovery share price of 18 cents.

“We will eventually have four drill rigs out there 24/7 for the next year. And we will also have a full camp out at site because it is a massive area of which we are currently only focused on two kilometres of 45 kilometres of strike,” Sikora says.

“We want to delineate that to the point where we build some real intrinsic value in the company, but also to find more.”

Rumble is rapidly advancing a pipeline of drill targets.

Rumble Resources

Signi�icant High-Grade Gold System and Multiple Tier 1 Projects

Rumble Resources Limited is an Australian-based mineral exploration company with a clear strategy of organic growth via the generation of a pipeline of quality high-grade base and precious metal projects, critical review against stringent criteria, and complete systematic exploration targeting high-grade world class discoveries on multiple projects.

Contact: Shane Sikora Phone: +61 (8) 6555 3980 info@rumbleresources.com.au

ASX: RTR

www.rumbleresources.com.au

MINERAL SANDS

Mozambique mineral sands opportunity emerges Andrew Van Der Zwan reviews the exploration plans MRG Metals has in store at the Corridor Central project in Mozambique.

A

SX junior MRG Metals has emerged as a major player at the world-class Corridor South and Corridor Central mineral sands projects in Mozambique, Africa.

And despite already having established a big resource at the Koko Massava deposit in its Corridor Central project area (1.42 billion tonnes grading 5.2 per cent total heavy minerals), MRG has more exploration to do.

Follow-up infill drilling has identified high-grade zones, which are likely to proceed to mineral resource estimates.

MRG chairman Andrew Van Der Zwan says it is a case of pursuing a double opportunity for shareholders.

“There is the opportunity to participate in what we’ve got at Corridor and how we are going to develop those, but excitingly, we are still an exploration play, and we’ve hundreds of square kilometres to explore with our lowcost exploration method,” he says.

Van Der Zwan says the plan is to outline 100 million tonnes-plus of the best mineral sands across MRG properties to deliver a starter project with a high net present value and with a five- to 10-year mine life (within a larger 100-year mine life resource), making financing for a development easier to secure.

He says 2021 is a busy one for the company, including in-fill drilling at a

MRG’s exploration has returned impressive grades.

number of targets. “By the latter part of the year we will be ready to do scoping/ feasibility study work into a development.

But we should also be seen as an exploration play,” Van Der Zwan says.

“As it is, we have got some good stuff in the bag already, but we have plenty of opportunities to enhance that.”

The scale of the opportunity is unusual for a company the size of MRG with its current modest market capitalisation.

Students of mining company history

Drilling activities at MRG’s Corridor Central project area.

– 52 –

MRG has a busy exploration campaign ahead in 2021.

will recall that the broader Corridor mineral sands province was once a prized project within Western Mining Corporation (WMC).

WMC saw Corridor as a $US2.5 billion ($3.2 billion) development opportunity of a world-class resource. But the project fell off the radar following WMC’s takeover by BHP in 2005. Chinese interests later secured the northern tenement area, while about two years ago, MRG picked up the central and southern tenements, along with the unexplored Marao and Marruca licences, (with Marao exploration underway).

“WMC were really bullish on it. They had the money approved to invest and were working with the government on prefeasibility and environmental studies. They took it a long way only for BHP to let it go after a few years,’’ Van Der Zwan explains.

“It was lucky for us as we’ve got two of the tenements.’’

Importantly for future development planning, regional rail, port and gas pipeline infrastructure is being substantially upgraded as a result of Mozambique’s LNG investment boom.

MRG raised $2.1 million from a share/ option placement in February to expand its exploration effort, including at the Marao and Marruca licences.

“With mineral sands prices on the rise, there has never been a more exciting time to be involved in this space,’’ Van Der Zwan says.

2021

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INDUSTRY TRAINING

The University of Queensland leads change in resources sector Initiatives in engineering education and the research strengths of the University are helping Australian mining transition to a more sustainable world.

T

he University of Queensland (UQ) is reimagining the future of mining engineering through innovation in teaching and research – and a focus on sustainability.

UQ this year launched a reconfigured Bachelor of Engineering (Honours) degree that will put its graduates at the forefront of engineering trends from 2024 and beyond.

More UQ students are expected to pursue a career in resources by undertaking a Major in Mining Engineering and combining it with another engineering specialisation.

UQ plans to further enhance the focus on mining engineering in its combined Bachelor of Engineering (Honours)/Master of Engineering through an on-site project and short-form credentials.

“UQ is creating a new generation of resource engineers,” Professor Ross McAree, head of the School of Mechanical and Mining Engineering, says. “We are developing resource-sector engineers who have broader skill sets and who can address future challenges.”

UQ is ideally positioned to lead change in mining engineering.

The University ranked first in the world for Mining and Mineral Engineering in 2018, according to the Shanghai Ranking. UQ has consistently ranked in the world’s top universities for miningengineering education and is Australia’s largest tertiary provider of engineering education.

“Across UQ, there are exceptional capabilities in the resource sector,” McAree says. “We have extensive skills in engineering education, and in resources research through the Sustainable Minerals Institute, the School of Mechanical and Mining Engineering, and other UQ faculties. The university’s interdisciplinary focus on resources is one of its great strengths.”

I N D U S T R Y C O L L A B O R AT I O N

More mining engineers are needed to drive growth in Australia’s resource sector and to develop and commercialise technologies.

However, enrolments in mining-engineering programs in Australia are in long-term decline.

About one in 10 engineering students at UQ studies mining engineering each year. “Like other universities, UQ is not producing enough mining engineers to meet industry demand,” McAree says.

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UQ consulted with industry and students on the redesign of its mining engineering programs, and McAree says some large mining companies challenged UQ to consider radical reform in mining engineering education.

“They want UQ to produce engineering graduates who can work across the sector in varied roles, have a mindset to drive change, and skills in sustainability,” he says.

Students, McAree says, want to work in industries that drive positive environmental and social change. “Some students overlooked mining engineering because they equated the resource sector with climate change. They don’t yet understand mining engineering’s role in driving environmental outcomes or career opportunities in sustainability in the resource sector,” he says.

Students also wanted greater flexibility in engineering education. Previously, UQ students had to choose to study mining engineering after they completed their first year. Some saw better career options in engineering specialisations that required less remote work.

N E W E R A O F E N G I N E E R I N G E D U C AT I O N

In UQ’s Bachelor of Engineering (Honours), students specialise in mechanical, electrical, chemical, mechatronic, software or civil engineering in years two and three of their four-year program.

In the final year, civil, mechanical and mechatronic engineering students can undertake a Major in Mining Engineer (or spread it over years three and four).

The goal is to develop engineers with a specialisation in civil, mechanical or mechatronic engineering, who also understand mining engineering fundamentals. “There is an industry need for engineering graduates with deeper understanding of mining practices,” McAree says.

The UQ Bachelor of Engineering (Honours)/Master of Engineering will have a fifth year incorporating work-integrated learning and short-form credentials on surface and underground mining, short-cycle control, value-chain optimisation, and sustainability and mine closure.

McAree is excited about workplace learning. “We will integrate graduate programs. Essentially, students will work on site with a potential employer,” McAree says.

AUSTRALIAN RESOURCES & INVESTMENT

UQ is developing resource-sector engineers with broader skill sets.

The School of Mechanical and Mining Engineering also intends to launch a Master of Professional Engineering in Mining Engineering (pending university approval).

McAree believes changes will lift student numbers in the Mining Engineering major to 60100 annually, from 10-15 now.

O U T S TA N D I N G R E S E A R C H

UQ’s new approach to mining-engineering education leverages the research strengths of the school and those of the Sustainable Minerals Institute (SMI). Consisting of six research centres, including a Centre of Excellence in Chile and a technology transfer company (JKTech), the SMI is one of the world’s largest university research hubs in resources.

It has a strong track record in exploration, mining, mineral processing, workplace health and safety, mine rehabilitation, water and energy, social responsibility and governance.

In addition to depth of expertise, UQ also has strategic programs examining key future issues facing the minerals industry -Unlocking Complex Orebodies, Governance and Leadership, Development Minerals, Future Autonomous Systems and Technology, and Transformational Learning UQ and The University of Western Australia are hosting the Cooperative Research Centre for Transformation in Mining Economies (CRC TiME). Launched in 2020, the CRC secured $30 million in federal government funding. Its 74 partners are contributing a further $100 million to the CRC. SMI Director Professor Neville Plint says the Institute continues to evolve its research focus to address sustainability challenges facing the sector.

“As the world moves from carbon-based energy sources to renewables, the SMI is helping Australia’s resource sector achieve a just transition to a low-carbon future,” Plint says.

“We’re developing future resource-sector leaders who can be effective in leading multidisciplinary teams to address global sustainability and social responsibility challenges by creating an environment that encourages rigorous multi-disciplinary challenge led research. Our last 50 years of research has focused on making mining sustainable. We are now also focused on mining contribution to global sustainability through responsible resource development.”

Plint says the SMI collaborated on UQ’s new engineering programs through its transformational learning program.

“UQ researchers are investigating what the future of work in mining looks like. That research helped inform the changes in UQ’s mining engineering programs, which in my view are exceptionally well designed for a fast-changing resource sector,” he says.

The new structure of the curriculum enables broader disciplinary contributions from academics engaged in social responsibility, environmental management, health and safety, leadership and governance to the final year of UQ’s Bachelor of Engineering/Master of Engineering programs.

“Our people take cutting-edge research insights and often deep industry expertise, and apply that in the classroom,” Plint says.

“The resource industry recognises that sustainability is a huge opportunity and threat.

Australia needs more mining leaders who can work across disciplines and solve complex sustainability challenges in a responsible way.”

UQ Engineering student Amy Tran has already secured a graduate position in the resource sector in 2022.

To learn more about engineering at UQ, visit www.uq.edu.au For information on the Sustainable Minerals Institute, visit www.smi.uq.edu.au

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COPPER

Securing the future of WA’s copper sector

BY DR GEOFFR EY BATT, R ESEARCH PORTFOLIO M ANAGER AT THE MINER ALS R ESEARCH INSTITUTE OF WESTER N AUSTR ALIA.

T

he West Australian Government is supporting copper mining research in partnership with industry to deliver benefits to the state.

Copper has been a feature of the mining landscape in Western Australia since its discovery on the Murchison River in 1848, with the scale of mining and processing operations across the state rising and falling in tune with global prices for the metal over the following century and a half.

The state produced 170,000 tonnes of copper metal, generating sales of $1.3 billion in 2019-20. Although this accounted for less than 20 per cent of national production, this figure looks set to increase in coming years.

Recent headline-grabbing copper discoveries in the Paterson mineral province in the north of Western Australia and the Albany-Fraser mineral province in the state’s south-west have demonstrated an exciting untapped potential beneath the surface, driving $223 million in mineral exploration expenditure last year, accounting for over half of the copper exploration expenditure nationally.

This increased exploration interest reflects more than simply a re-evaluation of Western Australia’s mineral endowment – rich though it may be.

Recent pandemic-related production falls from major copper producers in Chile and Peru have seen short-term price spikes for the metal on global markets.

Underlying this volatility, fundamental growth in long-term demand is expected, driven by the key role of copper in electronics – with the metal viewed as critical to the delivery of renewable energy solutions required for a decarbonising economy.

– 56 –

Anchored as it is by the reality of discovering new mineral resources and putting in place the industrial infrastructure to extract and process the metal while protecting the interests of local communities and environments, the production of copper is unlikely to keep pace with this projected demand. Industry analysts are predicting a long-term supply gap of as much as 8.2 million tonnes by 2030.

With the search space for easily accessible copper deposits increasingly exhausted, the cost of exploring for and defining new resources at ever greater depths below the

the Minerals Research Institute of Western Australia (MRIWA), is partnering with the mining sector, as well as some of the best researchers in Australia and around the world to tackle these challenges.

They plan to deliver improvements across the mining value chain to help the state’s mineral industry lead the way in delivering new copper resources to meet projected demand.

As the conceptual search space for copper deposits broadens from the volcanic-hosted systems targeted in conventional exploration, MRIWA is supporting a range of research

This discovery of new deposits – although critical to the future of the industry – is only one of the challenges faced by the copper sector in realising its future potential. surface is increasing dramatically. And even when new deposits are identified the lead time between mineral discovery and the development of a mine can typically be 10 years or more.

To take advantage of this booming interest, the copper industry needs to improve both the rate of discovery success, and the efficiency with which copper resources can safely be developed.

The Western Australia Government, via

projects to deepen understanding of Western Australia’s mineral systems.

Professor Mark Jessell has led work at the University of Western Australia that is enhancing understanding of the conditions under which major copper mineralisation and other associated resources can develop during the evolution of sedimentary basins.

Focusing in particular on the Paterson mineral province in the north of Western Australia, Jessell’s research will enhance

AUSTRALIAN RESOURCES & INVESTMENT

WA is focusing on growing its copper sector as prices boom.

insight into how the major copper discoveries already made in this region were formed, and help future exploration programs predict where new resources may lie buried beneath the surface.

Similar insights are being developed for copper-bearing mineral systems in the AlbanyFraser mineral province in the state’s south by a research team led by Dr Katy Evans at Curtin University.

But here the challenge lies in understanding how the clues to mineralisation are changed and re-shaped by deformation and metamorphism of the region’s geology over time.

Addressing the practical challenges of mineral exploration, Dr Ryan Noble at CSIRO is being supported by MRIWA in his work to develop and test new approaches to sampling and analysis to improve the effectiveness of geochemical exploration using soils and weathered rocks to detect subtle clues to mineralisation buried beneath the surface.

Driving deeper, MRIWA is also committed to supporting the work of the Mineral Exploration Cooperative Research Centre – an Australia-wide initiative to deliver new technologies and insights to lower the cost and enhance the effectiveness of exploration drilling – making it easier for the industry to complete the fundamental work of identifying, sampling and evaluating buried mineralisation to identify viable orebodies.

Carried out in partnership with exploration companies and focusing on delivering innovative insights in ways that can rapidly be adopted and change industry practice, this research will help to reduce exploration risk and encourage industry investment in finding the next generation of orebodies in Western

Australia.

This discovery of new deposits – although critical to the future of the industry – is only one of the challenges faced by the copper sector in realising its future potential.

Making the process of extracting ore safer, reducing its impact on the environment and increasing the value of mined products are all parts of the complex pathway to ensuring maximum economic and social benefit from new mining projects in Western Australia.

Responding to the need to follow mineral systems ever-deeper below the surface to meet demand, technologies to support the engineering systems needed to safely mine complex rock masses are increasingly important.

Work led by the world-acclaimed Australian Centre for Geomechanics (ACG) at the University of Western Australia is developing new and more efficient ways of safely tunnelling and extracting ore deposits underground.

It is delivering understanding of rock properties and dangerous phenomena experienced at the huge pressures encountered in deep mine environments, improving mine safety and productivity.

Other work supported by MRIWA is investigating the potential for reducing the need for deep and complex mining altogether, developing technology for in-situ recovery of copper from mineral deposits using more selective practices with lower environmental impact.

Led by Dr Laura Kuhar at the CSIRO, a series of MRIWA projects is building understanding of the solution chemistry of copper minerals that could allow the valuable

copper – a relatively reactive and soluble metal – to be liberated and recovered from buried ore minerals in solution, leaving the host rocks undisturbed.

This technology offers the potential of reducing both the cost of mining and its impacts on the environment, allowing copper to be extracted from resources too deep or too low in grade to be economically viable using conventional mining practices.

In an exciting addition to this research, more work at the ACG is exploring the use of electric fields to target this in-situ extraction technology.

Professor Andy Fourie and his team have shown that rather than needing cracked and porous rocks that fluids can easily disperse through, electrical currents can rapidly and efficiently move fluids containing metal ions through solid rocks.

By installing electrodes within an orebody, the researchers hope to greatly increase the efficiency of this chemical extraction process – and make it possible to stop the migration of the fluids afterwards by simply turning off the current, further reducing the environmental impact of this extraction technology.

This dynamic portfolio of research represents investment of $5.4 million of state government money in addressing the challenges of the copper industry in Western Australia.

Under the stewardship of MRIWA, this investment ensures that the collective strengths of government, leading research teams and the innovative modern mining industry of Western Australia work together to achieve the future potential of the copper sector, delivering economic and social benefit for the state.

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D I G I TA L M I N I N G

VEGA helps Rio Tinto overcome water level hurdle VEGA’s advanced sensing technologies have abolished a longstanding issue faced by many mining operators: the inaccuracy of water level readings in water carts.

Introducing VEGAPULS C11 and VEGAMET 841 sensors.

M

ining operators have been dealing with the issue of inaccurate water level readings in water carts.

This is recognised by Rio Tinto manager mining, Robe Valley operations, Phil Scott and others as a persistent problem in the sector.

This issue was reported in the water trucks at Rio Tinto’s Mesa A iron ore operation in Western Australia during a pre-start meeting last year.

Rio Tinto approached Current Engineering Solutions senior electrical engineer Paul Smith, who has worked with VEGA radars in fixed plant environments for more than 10 years, to assess the concern.

Smith, recounting a story from a conversation with Scott, says he remarked how it is amazing that mining has trucks that drive themselves, but still hasn’t overcome the issue with the level indicator.

The sensor was very accurate, and to date, we have had no issues at all with reliability or accuracy.

The operators now have an almost exact percentage or level height measurement that they can use to work out how far they can travel before running out.

According to Smith, the problem originates from the use of mechanical switches and moving parts, which are “always a disadvantage”.

“The system they were using comprised of multiple cable float switches that were held together with a plastic wire,” Smith says. “This technology is unreliable due to its moving parts.”

Smith worked with VEGA Australia area manager (Western

– 58 –

Australia) Andrew van de Sande to make sure Rio Tinto received a suitable outcome.

First, they fully tested the VEGAPULS C11 series sensor and VEGAMET 841 controller in both a bathtub and swimming pool before they proceeded with a trial at the Mesa A operation.

The installation of the VEGAPULS C11 and VEGAMET 841 sensors on Mesa A’s water trucks would be the first application of its kind for the products.

VEGAPULS C11 was released last year and is usually used for noncontact level measurement in water treatment, pumping stations and rain overflow basins.

“The new C series radar stood out as a good choice as it was well within the required dynamic range extending up to eight metres,” Smith says.

“And being both contactless without moving parts, this was seen as the perfect choice to replace the existing system that comprised multiple mechanical type float switches.”

The VEGAMET 841 controller is an upgraded series of the VEGAMET model, an already proven sensor at Rio Tinto’s mine operations.

It allows a simple conversion of pump controls and flow measurements on open channels, and weirs and totalisers.

Smith says what makes VEGAMET 841 a standout technology is the controller has a dedicated housing that withstands harsh environments, instead of being integrated to a switchbox or programmable logic controller (PLC).

“We put them through some rigorous testing in the bathtub and swimming pool for the conditions we were expecting them to be put under at the mine site,” van de Sande says.

“We submerged them under water and we made large waves in the pool, but their performance surpassed all expectations. They worked beautifully without any teething issues.”

The private trial confirmed their confidence in the products’ new application, leading them to proceed with a trial at the Mesa A operation in December.

Smith says the Mesa A site team supported the trial by accommodating water cart access and an operator to work with for multiple cycles while on site.

“They were also very proactive in implementing other elements that were required to be completed for a successful deployment, including the management of change for the trial and single point lesson detailing the new system,” he says.

Rio Tinto testifies of the accuracy of the system during the trial, having experienced zero reliability issues.

“The sensor was very accurate, and to date, we have had no issues at all with reliability or accuracy. The operators now have an almost exact percentage or level height measurement that they can use to

AUSTRALIAN RESOURCES & INVESTMENT

The upgraded system at the Pilbara iron ore site.

The accuracy of the system has delighted Rio Tinto.

work out how far they can travel before running out,” Rio Tinto’s Scott says.

“This may not sound like a big deal, but in a very hot and dusty condition, water truck operators are often under immense pressure to keep up with the requirements of mitigating dust levels.”

Smith says it is frustrating to drive down a haul road for 40 minutes thinking there is enough water in the cart, only to run out and then have to drive back to refill the truck.

He explains that it creates more complications for the mine site. The higher movement of trucks means that they are creating more dust, while increasing vehicle interaction on an already busy haul road.

The unreliability of water indicators also translates to wastage when an overfill at the water stand happens, causing wash outs that put others at a safety hazard.

“The system is now being sold as a complete pre-programmed kit with all the necessary installation materials, including the radar, display, mounting adapters, terminal box, terminals, glands and reducers for installation, as the water carts go into the workshop for a scheduled service,” Smith says.

He anticipates that the company’s solution at the Mesa A mine will be a catalyst for mining companies to demand this standard of technology from OEMs. “Knowing there’s a solution out there means that the problem will no longer be accepted,” Smith concludes.

Previous level measurement in a water cart.

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MINE DE VELOPMENT

MMBI BLOCKCHAIN PLATFORM GUIDES RESPONSIBLE SOURCING

BY ANASTASIA KUSKOVA, EUR ASIAN R ESOURCES GROUP, AND SAR AJIT JHA OF TATA STEEL. EDITOR: SUSAN JOSEPH, SUSAN JOSEPH LLC.

T

he mining and metals industry provides materials that are, among other things, the building blocks of technologically enabled products.

As the demand for these products rapidly increases, so does the demand for these materials and for overall supply chains involved to be sustainable, responsible and traceable.

This places the mining and metals supply chains under a microscope. In 2020, climate policy became a prominent topic of every strategy discussion in the mining and metals industry, from the boardroom to the mailroom.

The effects on the mining and metals industry are twofold. First, there is increasing pressure on miners to control, report, manage and reduce their carbon footprint.

This is especially relevant for aluminium and steel, responsible together for 95 per cent of the mining industry climate footprint.

But battery metals are also under scrutiny. With the world going electric, consumers want to be certain their electric vehicles (EVs) are produced in an environmentally friendly and climate-conscious way.

Second, growing climate concerns increase demand on green economy metals. These are, again, aluminium, steel and battery materials such as cobalt, copper etc.

That is why the ecological agenda presents both risks and significant opportunities for mining and metal producers.

As an industry, we find ourselves in a new world where ESG (environmental, social and corporate governance) factors and carbon footprints specifically start to define competitiveness of mining and metal producers. We also find ourselves with the significant opportunity to enable a low carbon society.

We recognise the importance of the ESG factors that we face as a society and the inability for any one company to singlehandedly resolve these environmental and climate issues.

We also recognise the need to tie our sustainability efforts to technological cooperation with the wider industry and across supply chains.

MMBI IS CONVENED With that in mind, MMBI, the global Mining and Metals Blockchain Initiative, was convened through the World Economic Forum (WEF)

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in October 2019.

The founding members of MMBI – Anglo American, Antofagasta Minerals, Eurasian Resources Group (ERG), Glencore, Klöckner & Co, Minsur and Tata Steel specifically joined forces to design and explore blockchain solutions to accelerate responsible sourcing across supply chains through solutions that encourage supply chain visibility and ESG transparency so that we can anticipate and innovate to meet the future.

T E C H N O L O GY M E E T S S U S TA I N A B I L I T Y Imagine a world, where you as a consumer could chose a car or a phone with a known, verified and trusted carbon footprint, including all manufacturing and transportation stages.

This world, not yet in existence, is coming where companies have actionable analytics to optimise the lifecycle emissions on all production steps from the mine to market.

How do we get there? MMBI’s solution is to provide a unifying non-competitive platform that shows transparency to transform this envisioned world into reality.

Today, many companies measure and report greenhouse gas emissions (GHG) Scopes 1 (direct emissions) and 2 (some indirect emissions).

These tracked measurements, while necessary, do not capture the full story. To understand emissions, Scope 3 emissions (indirect GHG emissions of a company’s value chain) should be tracked and reported.

According to CDP, a leading not-for-profit known for running environmental impact global disclosure systems, as quoted by Kermida, advises that on average, about 80 per cent of a reporting organisation’s GHG emissions come from their value chain emissions.

A report published in January this year by the WEF, in collaboration with Boston Consulting Group explains that setting zero targets for Scope 3 emissions and viewing them is one of the major amplifiers for a company’s climate impact.

Yet, Scope 3 emissions are complex to capture and to date, no easy solution exists to directly track, trace and report them.

The data about these emissions is fragmented, and companies often have to rely on industry averages, decreasing accuracy and

AUSTRALIAN RESOURCES & INVESTMENT

Blockchain technology is shaping as an answer for responsible supply chains.

optimisation potential.

Contrast this with the world’s expectation that this type of directly captured information will become available as setting targets and reducing value chain emissions is essential for meeting the Paris Agreement goals and, eventually, reaching zero.

Enter MMBI’s solution which is to create a direct view of companies’ value chain emissions, a sorely needed solution.

To begin, MMBI pioneered capturing embedded carbon in the carbon traceability space with the development of its COT platform.

We selected blockchain technology to enable our vision to collaborate, share information and maintain control over sensitive data in an automated manner. Blockchain technology allows for companies to collaborate and share data by: Leaving the information in a shared state with the availability and integrity guarantees; Sharing sensitive data and maintaining full control over it, benefitting individual players and regulators without harming anyone’s competitive advantage.

The COT platform, which is in proof-ofconcept state, connects the players by means of transactions, and calculates the total GHG emissions over the value chain per tonne of product.

The platform delivers reports, enables data sharing and simplifies the emissions audit.

Additionally, downstream companies have the ability to analyse GHG emission performance data of suppliers, thus, moving from siloed use of the data to a more holistic view across the industry.

While blockchain technology can be viewed as a tool to create the platform, the key to tracking value chain emissions overall is collaborating with

competitors.

MMBI has successfully navigated this complex path by focusing on the solution that can grow and be further developed to account for embedded emissions.

TATA S T E E L S U S TA I N A B I L I T Y PERSPECTIVES “Tata collaborates with many external stakeholders. The collaboration expands from procurement of raw materials to distributor dealer network. Blockchain solutions can help us manage our risk. Some examples include: 1. TubesNxt – Blockchain enabled TSL to protect our customers from counterfeit risk while reducing costs of countermeasures.

2. Inter Company Reconciliation – TSL and its group companies are distinct system entities, that can use blockchain technology to create a common data layer that can be instrumental in regulatory filings.”

EURASIAN REOURCES GROUP “ERG sees an enormous value in the technological collaboration with the industry. We are very active on the WEF platforms and drive several initiatives with one overarching goal: create traceable and responsible supply chains from the mine to the market.

“In parallel to the MMBI collaboration, we are implementing blockchain to trace the origin of the materials and ensure our partners have visibility over our compliance with various ESG standards.

“And this is all supported by our work with the Global Battery Alliance, where we drive the development of a technology-enabled battery passport, to provide visibility over ESG standards linked to battery supply chains.”

1. https://www.weforum.org/press/2019/10/ seven-mining-metals-companies-partner-onresponsible-sourcing-with-world-economicforum/ 2. https://www.keramida.com/blog/whatare-scope-3-carbon-emissions-why-are-theyimportant 3. http://www3.weforum.org/docs/WEF_ Net_Zero_Challenge_The_Supply_Chain_ Opportunity_2021.pdf

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MINE DE VELOPMENT

Greener mining companies are increasingly attractive to modern investors.

Green mining – its importance to investors

A

BY AUSBIL INVESTMENT M ANAGEMENT’S AUSBIL GLOBAL R ESOURCES FUND PORTFOLIO M ANAGER S JA MES STEWART AND LUKE SMITH.

green mine is now possible given the nature of modern technology.

Today, there are many opportunities to reduce emissions within mining operations using technology that is available now, and new technology that is advancing quickly (such as electric mining equipment).

Technologies that can bring about a green revolution in mining include EV (electric vehicles) and battery technology (to displace diesel and increase renewable energy usage); carbon capture and storage that can offset carbon emissions in activities like smelting; chemical treatments and processing for critical resources; and water capture and recycling, for example.

In terms of carbon, the potential for technology to help companies achieve net zero targets is worth exploring, including alternative emerging developments in power generation, open pit mining, underground mining and materials processing.

W H Y G R E E N M I N I N G I S I M P O R TA N T T O I N V E S T O R S Over the past few years, we have witnessed a groundswell towards greater accounting for the environmental impact of mining, both in terms of the physical impact of mining (rehabilitation, tailings, etc) and measuring and reporting on carbon emissions.

The practices used in mining operations, and the environmental impact of an operation, are increasingly becoming

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a core focus for investors.

This trend will continue to gain investor attention in the coming years to the point where those at the forefront of low carbon emissions mining, and limited environmental impact, could attract a significant valuation premium to companies which lag the trend.

Within our investee companies, we like to see an acknowledgement of the trend towards lower carbon mining, and a clear focus on opportunities or plans to reduce the carbon footprint of operations.

For example, Fortescue Metals Group has announced net zero targets for 2030, some 20 years ahead of many mining companies whose net zero target date is 2050.

P O W E R G E N E R AT I O N : C A R B O N REDUCTION OPPORTUNITIES Mining tends to be energy intensive. Some jurisdictions are fortunate to have an abundance of low-cost renewable energy (such as hydro in regions of Canada/South America), whereas more remote operations often need to generate power through on-site generation.

On-site generation has historically been gas generation if infrastructure is available, diesel or HFO (heavy fuel oil) generation – all fossil fuels with different but damaging levels of impact on the environment.

Wood Mackenzie recently estimated that around 70 per cent

AUSTRALIAN RESOURCES & INVESTMENT

We are now starting to see remote operations increasingly add renewables as a supplement to older methods of power generation.

of emissions from copper mine sites come from power generation, while this figure is around 84 per cent for gold mining.

We are now starting to see remote operations increasingly add renewables as a supplement to older methods of power generation. In addition to the environmental benefits, the cost of these renewables is significantly more attractive for mining operators.

The operating costs for renewables are substantially lower than for fossil fuel generation.

However, the initial capital investment costs for renewables are around four times that of the cost of diesel and twice the cost of gas generation, without battery storage.

That said, given the average mine life, it is likely that these upfront capex costs could pay themselves off and begin to generate a positive contribution to the value of a mining project over time.

As battery storage and renewable generation technologies improve, these capex costs will fall, making renewable energy increasingly attractive.

Unfortunately, generation from wind and solar is somewhat unpredictable, meaning either battery storage is required, or backup fossil fuel generation may be required, especially when there is intermittency in alternative power sources.

The trend towards renewable energy generation in the mining sector is gaining a headwind, however, with a number of miners signing power supply agreements with external power providers, whereby the power provider will fund the higher upfront capital and charge it back

through a long-term power supply agreement.

Again, as the cost of batteries falls, the cost of renewables and investor demand for more carbon sensitive mining increases, we expect to see both miners and energy providers improving practices in this area.

CONCLUSION As investors, it is easy to fall behind the rapid and urgent development occurring in mines that are leveraging the available technology to lower costs, and increase the renewability and ESG (environment, social and corporate governance) performance of their assets.

Smart capital in the market is digging deeper with miners to assess how sustainable their resources and operations are in the context of looming net-zero targets, and with a world slowly divesting the idea that fossil fuels are entirely necessary.

Mining is at the forefront of the adoption of electric vehicles and renewable energy in the extraction and processing of minerals and metals that are critical to society, to renewable energy generation and storage, and to the needs of humanity.

There is now a virtuous circle in mining and metals that is improving and becoming increasingly economical such that investors seeking to outperform in this space can no longer ignore the ‘how’ of mineral and metal extraction.

Carbon neutrality offers an edge in understanding the larger ESG picture within natural resources, and we believe creates an opportunity for future outperformance.

James Stewart

Luke Smith

James Stewart is the portfolio manager, Ausbil Global Resources Fund and an equities analyst at Ausbil covering natural resources.

Stewart joined Ausbil in 2017, and has been in the industry since 2001, bringing long experience in resources and commodities to the Ausbil team.

Luke Smith is the Portfolio Manager, Ausbil Global Resources Fund and an Equities Analyst at Ausbil covering natural resources.

Luke joined Ausbil in 2014, and has been in the industry since 1998, gaining experience in the resources sector, both at a corporate level and as an equity analyst in financial services.

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MINING SERVICES

Hot dip galvanizing is one of the most sustainable methods for protecting steel.

Hot dip galvanizing in the resources industry The Galvanizers Association of Australia highlights the benefits of hot dip galvanizing for operators in the resources industry.

H

ot dip galvanizing (HDG) is a factoryapplied, metallurgically bonded zinc coating that has been used to protect steel from corrosion for more than 100 years.

It is a tough and abrasion-resistant coating, well suited for use in harsh environments. In Australia, there are around 40 galvanizing plants located close to all major centres and in many rural locations, providing a galvanizing service ranging from bolts to the structural steel requirements of major resources projects.

The benefits of using HDG to increase the durability of steel structures is well understood, and galvanized coatings provide predictable performance, both in atmospheric conditions and when embedded in soil and concrete – performance that is referenced in multiple Australian and international standards.

The relationship between corrosion prevention and durability is obvious, but did you know that there is also a close relationship between corrosion prevention and occupational work health and safety?

Structures, as defined in AS 5104 (ISO 2394) General principles on reliability for structures, are an organised combination of connected parts designed to provide some measure of rigidity.

Properly designed and built structures have minimum safety factors built into the design, which is a requirement of the structural codes (AS 1170). These must not be

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allowed to degrade over time for any reason, as to do so may expose personnel to hazards and breach the company’s duty of care.

The loss in structural integrity can result in structural collapse, which may be sudden and can result in multiple fatalities.

Corrosion is an insidious process and can be a major factor in the degradation of mining structures. Corrosion may be localised and the resulting reduction in structural integrity in that local area may not be readily observable.

In the initial design of mining structures, additional robustness may be required, and adequate controls put into effect, to manage the inevitable misuse and damage that occurs on site.

The use of a galvanized coating may reduce or even eliminate the requirements for maintenance painting, providing a safer and more productive workspace with less downtime.

This is of importance in the mining industry, where the environment is often harsh, and paint coatings are easily damaged.

Corrosion of high-stress areas is commonly overlooked by asset management teams, especially if assessors are not competent in the design of structures.

Structural integrity is not something that can be managed at the lower hierarchy of control levels, and inappropriate corrosion protection specification is a real issue in the mining industry; there is a need to design, build and maintain to ensure that the hazard

corrosion present is addressed.

Durability should be considered in the concept design stage – the later you leave it, the greater the cost to the business.

The Australian HDG industry is a world leader in environmental management, with a strong commitment to recycling. Members of the Galvanizers Association of Australia (GAA) have even developed an independently verified Environmental Product Declaration (EPD), based on the product category rules of EN 15804.

This is a first for the Australian coatings industry, and the first industry-wide HDG EPD produced outside of Europe and North America.

Galvanized structures can be designed to be re-used by using bolted connections, making them modular, demountable and readily transportable. This reduces waste and, with a coating life of over 50 years in many locations and applications, products can be remanufactured for use elsewhere.

And if the structure cannot be re-used, all steel and zinc can be fully recycled for reuse without downcycling. So, in addition to being one of the most effective and versatile protective coatings, HDG is also one of the most sustainable methods for protecting steel in the mining industry.

For more information on durability, sustainability and best practice design for HDG, visit www.gaa.com.au.

AUSTRALIAN RESOURCES & INVESTMENT

TUNGSTEN

Breathing life into the Mt Carbine mine

EQ Resources is on track to ramp up operations at the Mt Carbine mine.

Kevin MacNeill outlines how EQ Resources has rapidly progressed a revival of operations at the Mt Carbine tungsten mine in North Queensland.

P

lanning by EQ Resources to return the historic Mt Carbine tungsten mine to its former glory as a major producer of the strategic metal is fast taking shape.

The plan was buoyed recently when exploration beneath the historic open pit returned thick and high-grade intersections of the tungsten ores wolframite and scheelite.

EQ was aware that historical drilling in the pit area – Mt Carbine was last mined between 1971 and 1986 – was widely spaced, leaving several (150-metre) gaps.

A drilling program was kicked off in late March to test the gaps, with results by end-April confirming “significant” visible wolframite-scheelite mineralisation in the core (assays pending).

Results from the program form part of the feasibility study underway to return Mt Carbine to major tungsten producer status from 2022 from a combination of hard-rock material in the mine, and surface stockpiles/tailings at surface.

As it is, Mt Carbine resumed small scale tungsten production in September last year – making it Australia’s only primary (rather than by-product) tungsten producer.

Based on a mix of tailings and low-grade stockpiles, production is currently running at 15-20 tonnes a month of tungsten concentrate grading 50 per cent.

The production is very much the start of the story for Mt Carbine’s revival, with EQ derisking its return by taking a staged approach.

That approach is reflected in the current

production run, enabling EQ to trial an ore sorting technology (XRT).

EQ chief executive Kevin MacNeill says the ore sorter has been working incredibly well.

“If you put 100 tonnes of 8-30mm material into the sorter you pull out an 8-10 per cent concentrate, and we get 90-95 per cent recovery of the tungsten. So it upgrades the material very cheaply and very quickly,” MacNeill says.

He says that following the company’s recent $6.5 million capital raising, the processing rate at Mt Carbine would be ramped up to 300,000 tonnes per annum this year by debottlenecking the plant and having it ready to accept the stockpiled low-grade material at surface.

The feasibility study is being prepared for release in September/October and will bring together EQ’s production plans based on low-

grade ore stockpiles, high-grade ore from the pit floor, and ore from underground positions accessible from an existing 500-metre decline at the operation.

In the background, Mt Carbine’s broken rock at surface – and material rejected from the XRT sorter – has enabled the company to establish an aggregate business to provide a second cash flow stream at the operation.

The return of Mt Carbine comes as there is heightened concern among end-users of tungsten about China’s 80 per cent-plus grip on global supplies.

While those concerns have been part of the reason behind tungsten’s strong price improvement in recent months, MacNeill says the metal’s price long-term price trend continues to reflect global economic activity levels.

Drill core showing the bright blue of the tungsten ore.

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SILICA

Diatreme exploration drilling at the Galalar silica project.

SILICA SURGE

BY ANTHONY FENSOM

Silica continues to be considered a commodity of the future as demand expectations grow off the back of expansion in the solar panel market.

A

Diatreme Resources CEO Neil McIntyre.

ustralia’s emerging silica sand producers are eyeing a bright future, as the ‘new economy’ mineral benefits from a global economic upturn and solar energy boom.

With new projects under development across the east and west coasts, production is ramping up amid increasing demand and dwindling supply.

“Silica sand is in demand, particularly premium quality silica, as it is an essential ingredient for the fast-growing solar industry and other hightech glass applications,” Diatreme chief executive officer Neil McIntyre says.

“For Australia, this is an enormous opportunity as we create the minerals vital for the clean economy of the 21st century.”

NEX T LITHIUM Just how much of an opportunity is highlighted by the latest data from the International Energy Agency (IEA).

In its World Energy Outlook 2020, the Parisbased organisation described solar as “the new

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king of electricity,” with solar PV (photovoltaic) “consistently cheaper than new coal or gas-fired power plants in most countries.”

Solar is expected to lead a renewable energy boom across the Asia-Pacific, with analysts Fitch predicting solar capacity will overtake wind as early as 2021, growing at an average annual rate of 9.8 per cent.

Top markets for the solar PV surge include China, India, Japan and Taiwan, while Australia ranks first in the world for installed PV capacity per capita.

Solar PV electricity generation is seen rising from 664 terawatt hours (TWh) in 2019 to 4813 TWh through to 2040, and potentially as high as 8135 TWh over the same period should nations pick up the pace on emissions reduction, according to the IEA. Researchers at LUT University of Finland predict solar could become the major energy supplier by the middle of the century, generating as much as 76 per cent of global electricity demand.

AUSTRALIAN RESOURCES & INVESTMENT

With high purity silica a major component of solar panels, demand is booming, together with other applications including smartphone screens and even vials for vaccines.

Lower quality silica is seeing rising demand too, driven by its use in construction, foundries and other industrial uses, particularly as the world emerges from the COVID-19 pandemic.

IMARC estimates the global silica sand market could expand from $US8 billion ($10.27 billion) in 2019 to $US20 billion in 2024, boosted by accelerating growth in the solar panel market, which is projected to reach $US48 billion by 2025. The Asia-Pacific is seen as the fastest growing silica sand market, with the potential to reach $US8 billion by 2026.

The bullish forecasts have prompted analysts to describe silica as the ‘next lithium,’ given its potential to emerge from relative obscurity to become a major force in the clean energy boom.

This is particularly the case due to growing environmental concerns over illegal sand mining in Asia, with Australia offering a more sustainable and regulated product.

NEW PRODUCERS Australia’s listed miners have seized the moment to launch a number of new silica sand projects, including both in Queensland and Western Australia (WA).

In Queensland, Diatreme’s Galalar silica project is picking up speed, with the company planning to produce a high quality, low iron product for the solar PV market. The project is located near Cape Flattery, home to the world’s largest silica sand mine.

In March, Diatreme announced a 30 per cent expansion in the estimated silica resource to more than 61 million tonnes, increasing the prospects for a long-term operation.

The company has also reported positive results from metallurgical testwork, showing the project’s ability to produce a premium product.

Political impetus has also advanced, with federal lawmaker, Warren Entsch, describing Galalar as “transformational for Hope Vale and Cooktown … a great example of how sensible, low impact development can have a profoundly positive impact on local communities.”

With the Galalar project set to create more than 110 local jobs, the economic benefits for the Cooktown and Hopevale region will be significant.

The company aims to secure the necessary environmental and mining lease approvals this year, with potential first production from 2022.

Diatreme is also examining downstream processing opportunities in Townsville, which could potentially host glass manufacturing operations to supply the solar panel market.

“Galalar has enormous potential to deliver benefits for the whole region, supporting its post-pandemic recovery and helping to advance the clean energy revolution,” Diatreme’s McIntyre says.

Similar to Galalar, another Queensland company, Metallica Minerals is planning to develop a project near Cape Flattery. The company has estimated a 38 million tonne silica resource at its project, Cape Flattery Silica, with a scoping study to be released in 2021.

Meanwhile in Western Australia, VRX Silica is developing three projects in the state with a combined estimated resource of more than 1 billion tonnes.

In a May investor presentation, the company outlines that the scale of its projects could provide a long-term opportunity for the

Diatreme water boring activities at the Galalar project.

WA glass manufacturing industry. It aims for first production at its Arrowsmith North project in late 2021, followed by its Muchea and Arrowsmith Central projects.

Also in WA, Perpetual Resources has estimated a 139 million tonne resource at its Beharra silica sand project. A pre-feasibility study (completed in March 2021) says the project has “capability to become an essential low impurity supplier of high-quality silica sand products to the rapidly growing Asia-Pacific glass and foundry sand markets.”

Other WA project proponents include Australian Silica Quartz, which is progressing its Albany White Hill silica sand project and Suvo Strategic Minerals, which is advancing its Nova silica sands project.

W I L L AU S T R A L I A’ S S I L I C A B O O M C O N T I N U E ?

A March 2021 report by CNBC highlighted that an insatiable global appetite for sand could spark a major shortage of this key commodity.

The global rate of sand use, which has tripled over the past two decades due to urbanisation, has eclipsed the natural rate of replenishment.

“Is it time for panicking? Well, that will certainly not help, but it is time to take a look and change our perception about sand,” Pascal Peduzzi, a climate scientist with the United Nations Environment Programme, is quoted saying.

For a long underappreciated commodity, silica has suddenly become very big news.

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FOLLOW THE LE ADERS

FOLLOW THE LEADERS EXECUTIVE APPOINTMENTS IN MINING

Keep up to date with the latest executive movements across the mining sector, including Red River Resources, Cazaly Resources and more.

Red River Resources has welcomed former Newcrest Mining and Orica managing director and chief executive Ian Smith as a non-executive director.

Smith is backed by more than 40 years’ experience in mining engineering, with senior positions in the resources sector, such as chairman of the Minerals Council of Australia.

He was also previously global head of operational and technical excellence at Rio Tinto and managing director of Rio Tinto’s Comalco Aluminium Smelting subsidiary.

Smith is a fellow of the Australasian Institute of Mining and Metallurgy (AusIMM). “(Smith’s) appointment comes as Red River Resources has just commenced production at our Hillgrove gold mine in (New South Wales),” Red River chairman Brett Fletcher said. “(Smith’s) skillset, his extensive experience in the Australian and global mining industry will be invaluable to Red River as we seek to continue to grow and expand our asset base.”

Cazaly Resources has started a new leadership chapter with Tara French as the chief executive and managing director of the company.

French will initially fill the role of chief executive from July before transitioning to

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managing director following a three-month handover period with Nathan McMahon.

She is a geologist with 24 years’ mining and exploration experience, which has mainly been gained in Western Australia.

French was most recently general manager of exploration for Regis Resources where she had worked for 14 years. She was previously employed at Nickel Australia (now Azure Minerals), WMC Resources, Placer Dome and Normandy Mining.

Energy Resources of Australia (ERA) non-executive director Marcia Hanrahan has departed her role at the company following its annual general meeting in April.

Hanrahan joined ERA in mid-2020 after building a 20-year career in the resource industry.

Her experience spans from operating, corporate and major capital projects to working across aluminium, alumina, bauxite, industrial minerals and coal divisions. Hanrahan is also the head of risk at Rio Tinto.

Kingrose Mining has appointed Mark Smith as chief financial officer to succeed Chloe Lam, who steps down from the role after 10 years with the company.

Smith was previously chief financial

officer and group financial controller for Centamin, where he was key to the development, construction and operation of the Sukari gold project in Egypt.

He was also commercial manager for Endeavour Mining and Lihir Gold, both of which operated producing gold assets in West Africa.

Kingrose chief executive Fabian Baker said Smith brought a hands-on approach and a track record that included establishing exploration businesses in new jurisdictions through to building the systems and teams required to successfully deliver projects to production.

“I am delighted to welcome (Smith) to the team as we continue to reshape and advance Kingrose,” Baker said.

Sheffield Resources managing director and chief executive Bruce McFadzean will step down from his role, but remain with the company as a non-executive director, starting July.

McFadzean will also continue to serve as director of the company’s Kimberley mineral sands joint venture in Western Australia.

The change in positions is part of Sheffield’s revised leadership structure as the company enters the execution phase of its Thunderbird mineral sands project in Western Australia.

AUSTRALIAN RESOURCES & INVESTMENT

Sheffield non-executive chair John Richards will also be changing company positions, moving to the newly created role of lead independent director.

Richards acknowledged McFadzean’s role in delivering the Thunderbird project with joint venture partner Yansteel. “(McFadzean) worked tirelessly over a long period to identify and then execute the transaction which provides the equity component of the Thunderbird project development and the board expresses its sincere thanks for those efforts,” he said.

“We look forward to continuing to rely on (McFadzean’s) knowledge of the project and his relationships with key stakeholders as a non-executive director.”

Centrex Metals has named Robert Mencel as its new chief executive officer.

Mencel has over 25 years’ experience in developing and operating mining, minerals processing and engineering operations.

He has previously served as managing director and chief executive of resources companies.

Centrex Metals chairman Graham Chrisp said the board welcomed Mencel as a valuable addition to the company.

“Mr Mencel’s appointment comes at a critical growth phase for the company as it progresses the financing and

development of its flagship asset, the Ardmore rock phosphate project in northern Queensland, with the ultimate aim of transitioning from explorer to developer,” the company stated.

Mencel assumed the role of chief executive in late May. Rincon Resources has appointed Gary Harvey as chief executive, effective May 12.

Harvey previously held project, senior exploration and leadership roles with mining companies such as Viceroy Australia, Lionore Australia, Forrestania Gold and Johnsons Well Mining.

He also held non-technical roles with Fortescue Metals Group, Hetherington Exploration and Mining Title Consultants.

Harvey brings 25 years’ experience in gold and nickel exploration to the role, with his most recent role being exploration manager of Barra Resources.

Rincon executive chairman Geoff McNamara said Harvey would assist the company’s exploration prospects. “(Harvey) is an outstanding addition to the Rincon team,” McNamara said.

“His extensive exploration, tenement and land management experience in Western Australian will be a tremendous asset as the company prepares to commence an aggressive exploration campaign across its South Telfer, Laverton

and Kiwirrkurra projects.

“Having previously worked with (Harvey) I’m delighted that Rincon has been able to attract such a high calibre candidate to explore and develop its assets.”

Atrum Coal has announced the resignation of chairman Chuck Blixt and director George Edwards from the company’s board.

The board shake up sees director Glen Koropchuck appointed as chairman, and two new directors, Jeff Gerard and Anita Perry, join the board.

Gerard has over 40 years of experience in the resources industry, including in Australia, Africa, North and South America, China and Mongolia.

He has completed greenfield and brownfield due diligence and feasibility studies, and worked with governments, joint venture partners and the banking and investment community.

Perry is a senior executive in government relations, stakeholder engagement and regulatory affairs.

She spent 15 years of her career with BP where she held various executive and project management roles.

The NorZinc director was most recently BP vice president, communications and external affairs.

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EVENTS

G O L D C OA S T I N V E S T M E N T S H OWC A S E | G O L D C OA S T | J U N E 2 3 -2 4

Since 2007, the Gold Coast Investment Showcase has built an impressive reputation for providing a unique environment for investors to engage up-front with some of Australia’s most successful and exciting ASX-listed companies.

The diverse range of company presentations provides new investment opportunities, and the relaxed nature of this event also provides popular networking gatherings encouraging interaction between investors and company representatives.

The Gold Coast Investment Showcase aims to significantly increase knowledge of a variety of ASX-listed sectors, as well as potentially enhancing the performance of investment portfolios.

This Investment Forums is open to pre-listed and listed companies from all sectors, including mining and resources.

• goldcoastinvestmentshowcase.com.au DIGGER S & DE A L ER S M IN ING FORUM | K A L G O O R L I E | AU G U S T 2 - 4

Diggers & Dealers is celebrating its 30th year as a leading Australian mining investment event in 2021. Diggers & Dealers combines corporate presentations by listed mining and exploration companies, alongside a large exhibition area housing more than 160 exhibitors from the sector. Delegates include miners, explorers, brokers, bankers, investors, financiers and mining service industries from around the world.

The event provides a unique opportunity for industry professionals to meet and network, visit regional mine sites, engage with media, raise finance, invest in projects and generally engage with the resources sector at an executive level in the mining community setting of Kalgoorlie.

An entertainment program ensures that delegates experience the best of the style and hospitality of Kalgoorlie, the unofficial gold mining capital of Australia.

• diggersndealers.com.au WO M E N I N I N D U S T R Y AWA R D S | M E L B O U R N E | AU G U S T 1 7

Women across typically male-dominated industrial sectors will be honoured once more at the Women in Industry Awards. The event aims to acknowledge the exceptional women who have achieved success through their invaluable leadership, innovation and commitment to their sectors.

These may be women you work with, women whose achievements are inspiring you from afar, or women who are providing you with

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invaluable guidance and support.

Potential sectors for recognition have included quarrying, mining, road transport, manufacturing, engineering, logistics, bulk handling, waste management, rail and infrastructure. Past winner and 2021 ambassador Rachel Ashfield said the awards “give you an opportunity to highlight key aspects and career defining moments of your many years of success and dedication.”

Nominations close June 25.

• womeninindustry.com.au T H E AU S T R A L I A N G O L D C O N F E R E N C E | S Y D N E Y | O C T O B E R 2 1-2 2

The Australian Gold Conference 2021, held in association with The Perth Mint at the Sydney Sofitel Wentworth Hotel, will help attendees learn about the big macro-economic picture from a series of expert keynote speakers.

The conference and exhibition will bring together every aspect of the precious metals investment industry to educate everyday Australians and inform those already invested in the sector.

This is an event not just for the industry but for everyday people to understand the importance of protecting yourself in volatile times.

The event will include presentations from ASX-listed precious metals mining and exploration companies, which will share news so you can make informed investment decisions.

Bullion dealers will also be on hand to help you understand how and when to purchase physical metals.

• goldevents.com.au/australian-gold-conference I N T E R N AT I O N A L M I N I N G A N D R E S O U R C E S C O N F E R E N C E ( I M A R C) | M E L B O U R N E | O C T O B E R 2 5 -2 7

IMARC will be held at the Melbourne Showgrounds for the first time in 2021, providing Australia’s resources industry with opportunities to connect globally and grow.

As Australia’s largest mining event, IMARC creates a global conversation, mobilises the industry for collaboration and attracts some of the greatest leaders in the mining, investment and technology industries.

This year will see the introduction of a new venue to showcase the industry, providing an opportunity to launch a brand-new outdoor exhibition space, allowing IMARC to showcase bigger and better machinery and equipment than ever before.

With the world’s borders still locked down, IMARC in 2021 will be a hybrid event, welcoming Australian attendees to Melbourne and international attendees from more than 100 countries.

• imarcglobal.com

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