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Summer 2012

Drilling time Blackwater Exploration OceanaGold has reported encouraging results from its exploratory drilling programme beneath the historic Blackwater Mine at Reefton.


CRUSHERS

SCREENS

EXCAVATORS

BREAKERS

PARTS

10858

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Contents »

Summer 2012

Contents

5

05 Chatham Rock on the rise

Chatham Rock Phosphate is bullish about its prospects as mining consents are lodged.

10 Glass Earth evolves

Glass Earth Gold is making a successful transition from greenfields explorer to project development.

10

17 Bathurst on track

Bathurst Resources has nearly completed its new coal storage facility at Westport Port.

30 MINExpo proves popular

Thousands flocked to Las Vegas for the world’s largest mining industry trade show.

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Summer 2012

21

Phone 03 983 5500 Email paul@waterfordpress.co.nz www.waterfordpress.co.nz

Drilling time Blackwater Exploration OceanaGold has reported encouraging results from its exploratory drilling programme beneath the historic Blackwater Mine at Reefton.

Cover - drilling at Blackwater. Photo courtesy of OceanaGold

30

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News » PUBLISHER: James Lynch Ph: 03 983 5500 Email: james@waterfordpress.co.nz

EDITOR: Nick Gormack

Pike River report highlights company, system failures

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112 Wrights Road, Addington PO Box 37 346, Christchurch www.waterfordpress.co.nz These conditions are prescribed for the sake of understanding between the Company and its clients. Advertising is charged for on the basis of space taken up using a standard tabloid page. Actual space may be reduced during the printing process but this will effect all advertisers equally so no credit will be given for any reduction in size due to processing. The Company reserves the right to alter, change or omit entirely any advertisement or article that it considers to be objectionable or which may contravene any law. In the event of a failure on the part of the Company to insert advertising as instructed the Company may publish the advertisement at the first available subsequent reasonable date unless the advertisement features date sensitive material. Every care shall be taken to publish the advertisement in accordance with the advertisers instructions as to page and position but the Company reserves the right for whatever reason to place advertising in a different position and in doing so shall incur no liability whatsoever. Advertisers must advise Mining NZ immediately of any error or omission in advertisements and shall work constructively to remedy the situation which in the first instance shall be a rerun of the corrected advertisement in the next available issue of Mining NZ. Where advertisement proofs have been faxed or mailed to the client 48 hours prior to the nominated printing cutoff time acquiesce shall be taken as confirmation and acceptance. Corrections made by telephone shall be accepted but the Company reserves the right to decide whether a further proof should be faxed or mailed to the client. Accounts for advertising are due for payment within seven days of publication of the newspaper. Accounts not paid within this time may incur a penalty of 3% per month until the account is paid. Any debt collection costs incurred by the Company will be added to the account of the debtor. Views and opinions expressed in Mining NZ are not necessarily those of the editors, Waterford Press Ltd or publisher. Mining NZ welcomes contributions from freelance writers & journalists. All articles published at editors discretion. Mining NZ accepts no responsibilty for loss of photos or manuscripts.

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6 Mining NZ » Summer 2012

Jo Bailey Major changes to the health and safety regulatory system must happen immediately to prevent another tragedy on the scale of Pike River. This is a primary recommendation of the Royal Commission’s grim report into the explosion at the mine on November 19, 2010 where 29 miners and contractors lost their lives. The report provides a damning review of the disaster, highlighting the failure of both Pike River Coal and the former Department of Labour to protect the health and safety of the men underground. Cost cutting and the drive towards coal production before the mine was ready to produce coal are at the heart of the coal company’s failure according to the report. Pike River Coal had not completed the systems and infrastructure necessary for safe production and its health and safety systems were inadequate. The mine’s ventilation and methane drainage systems couldn’t cope, yet the mine company continued to press ahead with hydro coal mining, known to produce large amounts of methane. The report says it was this drive to produce coal before the mine was ready in order to pay off debt that “created the circumstance within which the tragedy occured”. The Commission is satisfied the immediate cause of the first explosion was the ignition of a substantial volume of methane gas and agrees with the Chief Coroner that the men probably died at the time of the explosion, or a short time after it. The report states that numerous warnings of a potential catastrophe were ignored.

In the 48 days before the explosion there were 21 reports of methane levels reaching explosive volumes but these warnings were not heeded. Mining should have been stopped until the risks could be properly managed. However the Commision says that mine management “lost sight of the aim to develop a productive and safe mine as its drive for production intensified”. Its report also contains harsh criticism of government and regulators, noting the lessons from past mining tragedies have not been learnt and that the effectiveness of the mining inspectorate has been declining for many years. At the time of the disaster there were just two mines inspectors covering the entire country. The report said that the Department of Labour didn’t have the focus, capacity or strategies to ensure Pike River Coal was meeting its legal responsibilities and instead assumed Pike was complying with the law. Pike was allowed to construct its mine with just one exit and an unsuitable ventilation shaft that could be accessed only by climbing up a vertical ladder. The report says that the mine company should have been prohibited from operating the mine until its health and safety systems were adequate. The Commission has come up with 16 Primary

Recommendations and says fundamental changes are required, and fast. These include a new Crown agent focused solely on health and safety; a new regulatory framework for underground coal mining to be established urgently; the Crown Minerals regime changed to ensure health and safety is an integral part of permit allocation and monitoring; the responsibilities of directors for health and safety to be reviewed; and an approved code of practice be issued by a health and safety regulator to guide directors on good governance practices. The report also calls for worker participation in health and safety in underground coal mines to be improved through legislative and administrative changes; and the immediate review of the incident management system for underground coal mine emergencies, with the activities of the Mine Rescues Service to be supported by legislation. The Pike River families have not given up hope of the recovery of the men’s remains - something the report admits is “very uncertain”. However the families are gathering their own team of experts in a bid to enter the mine. The families also want a charge of corporate manslaughter introduced in New Zealand, as is the case in Britain, Canada and Australia - an issue being considered by the Government in the wake of the disaster.

In the 48 days before the explosion there were 21 reports of methane levels reaching explosive volumes but these warnings were not heeded.

Coasters “resilience” put to the test Jo Bailey Solid Energy’s decision to place its Spring Creek mine into care and maintenance has been a major setback for the West Coast on the back of the Pike River disaster, however it is not all “doom, gloom and despair” on the ground, says Peter O’Sullivan, manager of Minerals West Coast. “Coasters are a pretty resilient bunch. “Although these have been significant blows for the region, I’m confident we can pick ourselves up, dust ourselves off and re-emerge again.” On October 25 Solid Energy announced it was mothballing, rather than closing the mine as part of a wider re-organisation of the company in response to “extremely week” global coal markets. Putting a mine into care and maintenance is a transitional state, when production is stopped for technical, environmental, financial or other reasons, and the owner has not yet decided if or when mine operations will resume. In the short term, the decision means

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redundancy for about 220 staff at Spring Creek Mine and the nearby Rocky Creek coal handling and processing plant. The displaced staff can apply for positions in a team of 16 which will maintain the mine and a team of four at Rocky Creek that will continue to operate processing coal from Solid Energy’s Strongman mining licence area. O’Sullivan says the impacts are being felt hard, by both the mining community and local businesses associated with the sector, particularly engineering firms “who rely on the mine and its workers” for their livelihoods. The Solid Energy decision comes hard on a sector and community that was already reeling from the Pike River disaster in 2010. “Who would have thought within a period of two years we would lose the two major underground coal mining operations on the West Coast? “We just hope that good news comes out of Bathurst’s Escarpment Mine environment court hearing (currently being held in Christchurch), as this project is much-needed to re-engage local

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sector resources and stabilise the West Coast economy.” Some of the displaced miners and contractors, particularly in the construction sector are also planning to get involved in the Christchurch rebuild, he adds. “Hopefully these opportunities will come to something fast enough to make a real difference,” says O’Sullivan. Alluvial gold mining is still progressing “quite well” in the region, with prices holding at a good level. However access to ground remains challenging. O’Sullivan says there has been “great news” around progression of OceanaGold’s Birthday Reef gold project at Reefton, although the company still has to go through a long consenting process before mine development can occur with its associated economic benefits to the community realised. “It has been a tough couple of years but as long as we can get one major project, such as the Escarpment Mine, underway as soon as possible, some of the pressure will start to come off.”


News »

Chatham Rock plans on the rise Jo Bailey Recent forecasts indicate higher profit numbers than previously expected for NZAX-listed Chatham Rock Phosphate (NZX: CRP) that plans to mine phosphate from the sea floor on the Chatham Rise about 450km east of Christchurch. CRP was granted a prospecting licence for the project in February 2010 and filed its mining licence application with New Zealand Petroleum and Minerals in September this year. It will require resource consents either under new Exclusive Economic Zone regulations or the existing Continental Shelf Act and hopes to be mining phosphate from the sea floor at depths of 400 metres by the end of 2014. CRP managing director Chris Castle says the company’s cashflow modelling shows the company will turn profitable in its first year of planned operations (the 2015-16 financial year), with stable annual profitability of around US$92 million before tax, which he says is “at least $US10m higher” than previously estimated. “This will see the value of the company climb to at least half a billion US dollars, around ten times its current value. It’s such a good news story. We’re not having a lot of difficulty attracting investment.” Castle says the new figures are a result of detailed market analysis by CRP’s new senior business development executive, Najib Moutia, who joined the company in June after 30 years with OCP, the world’s largest phosphate producer.

Chatham Rock Phosphate plans to mine phosphate from the sea floor on the Chatham Rise about 450km east of Christchurch. “He has invaluable industry expertise and contacts and an encyclopaedic knowledge of the industry. He is also very familiar with the New Zealand markets and has a close understanding of other potential markets for the product.” CRP’s rock phosphate in its organic state

The remote-operated vehicle, Zeus, on the Dorado Discovery ship at the Chatham Rise site.

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is highly regarded as a product with many environmental benefits. When directly applied to pastures after being crushed and spread it is at least as effective as super phosphate, while significantly reducing run off into waterways. Extraction of the rock phosphate would provide a locally produced alternative to the one million tonnes of this material used annually in New Zealand which is primarily imported from Morocco. The balance of CRP’s production would be sold to export markets. In early October, shares in the listed company reached a high of 46c after starting the year at 17c. “There has been a sharp rise in the share price which is great news for the people who invested at 10 cents last year. We’ve also raised a huge amount of money, with the market value of the company increasing from $8.5 to $52 million,” says Castle. A key milestone came in July when leading global dredging company Royal Boskalis Westminster NZ (Boskalis) took a 20 percent shareholding in the company. “This is a world first for the fledging under-sea mining industry. “It is tremendously positive to have Boskalis’s endorsement and support in the development of the programme.” Castle says an additional US$9m is needed to reach the target of US$25m to complete the project through to production.

The other major focus is analysing environmental data collected from the Chatham Rise site this year in order to apply for the resource consent. “There is a lot of work involved with that. We currently have NIWA working very hard alongside us on a number of associated projects.” Tests to beneficiate (or raise the level of phosphate) in the rock by scientists at Victoria University under contract for CRP have also been encouraging. They successfully beneficiated the rock from 21.6% to 28.5% P205 which could result in increased sales value, says Castle. “The next step is to establish whether the cost of beneficiation is attractive relative to the increase in the value of the product. If so we will embark on a full feasibility study to build a beneficiation plant.” He says while this is not crucial to the future of the project, it would be the “icing on the cake”. CRP has a “well defined” resource of 25 million tonnes of rock phosphate to extract over the 15 year life of its under-sea mine. However this is only 10% of its overall licence area, so there is potential for much greater ongoing production. The company has also applied for five prospecting licences offshore of Namibia covering about 45sqkm to prospect for undersea phosphates at similar depths to its Chatham Rise prospect. “Part of our strategy is to utilise the technology we’re developing here to other parts of the world to make CRP a true global force in the industry.”

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News »

Bathurst tackles appeal hearings Jo Bailey The Environment Court appeal hearings into the resource consents for Bathurst Resources Escarpment coal mine on the Denniston Plateau will wrap up early next month, although any decision from the court is not expected to be announced until February next year at the earliest. Dual-listed Bathurst Resources was granted resource consent for the proposed opencast mine in August last year but a residents’ association and environmental groups Forest & Bird and the West Coast Environment Network appealed. The residents’ group was later appeased by a plan change that will see Bathurst construct a multimillion dollar aerial conveyor that will transport coal from the Plateau to the stockpile area. This will replace the trucking system that was initially proposed to haul the coal off-site. The appeal on climate change is being heard separately. A hearing in the Environment Court determined that climate change effects need not be taken into consideration when granting consents. This was subsequently appealed to the High Court and again a decision was handed down supporting the earlier ruling. This has been appealed again, however a date for the next hearing has yet to be announced. The remaining appeal is being heard at the four-week hearings (plus a two-week break) that got underway in Christchurch on October 29 when Forest & Bird put its case against the development of the mine. Bathurst Resources has called ecology, planning and policy expert witnesses to the hearing to outline

The Escarpment Mine would be New Zealand’s second largest opencast coal mine.

why they believe the company’s best practice rehabilitation mining methods and returns to the environmental community will mitigate potential environmental damage. Some of the initiatives the company has offered to put in place including biodiversity management for 5620ha in the Heaphy River catchment area to boost protection of great spotted kiwi, South Island kaka and Powelliphanta land snails. Bathurst also proposes to establish predator control programmes on the Denniston Plateau targeting possums, stoats and rats. The Escarpment Mine would be New Zealand’s second largest opencast coal mine. It is expected to inject around $1 billion into the New Zealand economy over the first six years of production, with the creation of more than 400 jobs. Hundreds of additional jobs are expected to be created in the local community to support the project. Bathurst managing director Hamish Bohannan told Mining NZ in July that he was confident of cementing the permits despite the appeals process; and that once the process was completed, mining could be underway “in a matter of months”.

Golden touch: BIll Lind in action at the NZ Gold Panning Championships.

Champs pan out well for Bill Longtime Balclutha gold panner Bill Lind is once again the New Zealand champion. Lind won the 2012 New Zealand Gold Panning Championship, held at Arrowtown at Labour Weekend, the fifth time he has taken the title in the past six years. As well as the trophy, Lind walked away with a sluice machine, a gold medallion coin, and $1200 towards a trip to compete in the Australasian championships which will be held in March next year. Second in the championship was Annie Fitzgerald of Palmerston, while Queenstown’s Amelia Gatwood-Ferguson was third.

Gatwood-Ferguson also won both the Women’s and Open titles, while Marcus Binks of Bendigo won the Men’s and Classic titles. The event, sponsored by OceanaGold, was held in Arrowtown for the first time to coincide with the 150th anniversary celebrations of gold being discovered in the region. Annie Fitzgerald from OceanaGold, said the event not only allowed a new generation of panners to evolve, and techniques to change and develop, but was also an opportunity to recognise and pay contribution to the traditional gold pan and the pioneers of the past.

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8 Mining NZ » Summer 2012

Protecting mining equipment from fire could save companies millions of dollars, says Steve Benseman from Fire Suppression Systems. “If companies have a complete burn-out of one of their key pieces of equipment, it could be out of action for up to a year which would cost them an awful lot of money.” Benseman says the lead time to replace highly specialised mining and construction equipment is currently around 50 weeks from when an order is placed to when it arrives in New Zealand. “That’s why it is imperative companies protect their existing machinery as the combination of large amounts of fuel, hydraulic oil, extremely hot surfaces and electrical components create an operating environment with an inherently high fire risk.” Benseman has 13 years experience in advising, installing and maintaining fire suppression systems at New Zealand mine sites. He says it is important companies deal with a specialist such as Fire Suppression Systems to ensure their systems meet the testing and certified standards required of the industry. “Some of our competitors dabble in fire suppression work outside their core business, but I believe we’re the only company in New Zealand to focus solely on mobile equipment fire suppression.” Fire Suppression Systems offers a full range of systems for the mining, construction, drilling, forestry and mobile equipment industries. Benseman is based in Auckland and employs three mobile technicians who operate from other parts of the country. Between them they visit clients’ often remote sites in fully set-up vehicles that enable them to provide complete equipment install, maintenance and servicing on-site.

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The expert team can also provide clients with advice on preventative measures and maintenance practices they can undertake to further reduce fire risk. Benseman is the New Zealand agent for foam fire suppression system Sandvik NFP 1000. Around 18,000 Sandvik systems are now being used worldwide, he says. The system is fully compliant with the new Australian standard AS5062. A key feature is that it is completely selfcontained so even if there is no electricity or person to operate the system it will still activate in the event of an emergency. Benseman says Fire Suppression Systems recently installed fire suppression systems to 115 machines for the Downer/Solid Energy Stockton Alliance on the West Coast, its biggest single install to date. “We continue to look after every other major mine in the country. “We pride ourselves on delivering reliable, proven products that give our customers peace of mind that their equipment and staff will be protected should a fire incident occur.”


News »

Poll confirms support for minerals industry Jo Bailey An opinion poll shows strong Kiwi support for the minerals industry, but it still has to work harder to improve public understanding, says Chris Baker, CEO of Straterra. “One of the key messages from Pauline Colmar, who undertook the survey and presented the results to the Mining Club following Straterra’s recent board meeting, was that the industry has to ‘come out of the closet’. She’s right - we still have more to do.” The nationwide survey of 1000 New Zealanders in February and March revealed 81 percent believe it is very important or quite important to develop New Zealand’s natural resources for prosperity, with 77 percent being very concerned or quite concerned about New Zealand’s current standard of living. “The results reveal that most New Zealanders support responsible minerals exploration and mining, contrary to what a vocal and persistent minority would have us believe.” While 59% percent of interviewees agreed or agreed strongly with the development of New Zealand’s natural resources, a much higher percentage agreed or agreed strongly if the following statements applied: the environment is protected (79 percent); local people are employed (84 percent); boosts the economy (83 percent); money stays in New Zealand (82 percent); done by New Zealand companies (78 percent). ”The facts are that most of those provisos already happen yet the public are generally unaware. This underpins the need to promote a better understanding of mining activities and how mining occurs,” says Baker.

Chris Baker and Pauline Colmar. There was high level of interest in the survey results from the Straterra board and “an element of pleasant surprise”, he adds. “It’s one thing for us to say the support for the minerals industry is higher than the general perception, but to have the evidence in cold hard facts and see it out there in the public domain is great.” Baker says the column space typically given to opponents of development has tended to skew the debate. “Obviously it is good to have the debate but we also have to ensure the point of view of the minerals and mining sector is clearly and fairly represented so its role in our modern society, and in improving New Zealand’s standard of living is better understood.”

Northland tender due to close The government’s tender process to manage competitive interest in metallic minerals exploration in New Zealand’s Northland region is about to draw to a close. Minerals exploration companies have until December 7, 2012, to evaluate the data - which was collected in a aeromagnetic survey of the region - and submit five-year, staged, exploration work programme bids. Spokesperson for New Zealand Petroleum & Minerals Tracy Dillimore says that the Ministry of Business, Innovation and Employment will not be

releasing information on the response to the tender round until permits are awarded in 2013. “Any announcement before then would be purely speculative and would not be a fair indication of the outcome of the government’s evaluation of those bids and the number of permits that may be awarded,” says Dillimore. The opening of the tender for exploration permits followed the public release in May this year of more than 13,500sqkm of aeromagnetic data gathered in 2011 and supporting interpretations of the data by GNS Science.

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Gold » Glass Earth Gold

GEG’s operations are partially self-funded through production from its Drybread placer mining operations in Central Otago.

Glass Earth moving to next phase Jo Bailey Glass Earth Gold (GEG) is making a successful transition from greenfields explorer to resource delineation, project feasibility and development, says director Simon Henderson. “We have two advanced epithermal projects likely to proceed to development which is exciting news for the company.” The first is a new Hauraki gold/silver project called Neavesville with a historical JORC compliant resource of + 300,000 oz and with ongoing exploration the potential to exceed 1 million ounces from both open pit and underground resources. This project will be under GEG management and developed in partnership with a New Zealand mining group. GEG’s second significant project is WKP, a

gold/silver project in Hauraki in joint venture with Newmont (65 percent) that has similar resource potential. “The latest drilling results at this site have been particularly encouraging because we struck into a new style of epithermal veining and mineralisation. “It is the sort of thing we’ve been looking for - an intercept into the right sort of ground with the signatures and mineralisation that indicate that we’re onto the real thing. It’s a really neat progression.” The WKP project is located 10km of Waihi and around 3km northeast of Golden Cross that was mined successfully in the 1990s. “Our latest drilling results are very much like Golden Cross in style which is more good news. “Drilling will now intensify on the structure to define the resource and hopefully move to feasibility study and mine development.”

That is what people buy into - the possibility that clever science and good exploration will deliver something worth 200 or 300 times their initial investment.”

GEG has also partnered with Newmont Waiahi Gold in the Waihi West Project in the Martha Gold Mine operations where GEG holds key ground holdings adjacent to the Martha, Trio and Correnso deposits. Henderson says the company is making its most significant transition since it was founded in 2005. “It’s a real change to go from being one of New Zealand’s leading gold hard rock greenfield explorers to having projects coming to fruition,” he says. GEG’s operations are partially self-funded through production from its Drybread placer mining operations in Central Otago that it took over in March this year. Production at the two alluvial mines is “building up” to 4000 oz per annum and is anticipated to reach 6000 to 7000 oz within the next 18 months. “The profit from these operations covers our general and administrative expenses and contributes to our exploration costs and acquisition activities.” Henderson has spent a significant amount of time in Alexandra over the last few months to manage the company’s transition to “fully fledged miner” at Drybread.

“We overcame a difficult winter to be operating consistently by September and October thanks to the great 20 staff who make up the Glass Earth Gold mining team.” GEG’s experienced geological team continue their systematic exploration of the Ophir and Garibaldi sites, located within 100km of OceanaGold’s Macraes Gold Mine. Both these sites are likely to provide “higher grade, metallurgically simple ore” for a small scale mine, says Henderson. With positive signs on both the exploration and development front across its New Zealand operations, Henderson’s attention has turned to attracting potential off-shore investors. He recently left on a marketing tour to Canada, North America and Europe to raise funds to develop GEG’s projects, particularly its exciting Neavesville and WKP developments. “I do around three of these trips a year which is a necessity in this business. “It is exciting to approach the market with the prospect of converting one of our discoveries into a major hard rock mine. That is what people buy into - the possibility that clever science and good exploration will deliver something worth 200 or 300 times their initial investment.”

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10 Mining NZ » Summer 2012

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Gold » Glass Earth Gold

Company to take over Neavesville exploration A significant gold and

Jo Bailey Glass Earth Gold has entered into sale and purchase agreement with Eurasian Minerals to uplift the exploration permits for one of the last untested but known gold and silver deposits in the Hauraki goldfield, says director Simon Henderson. “We are very pleased to have signed this agreement that covers a 30sqkm land area 10km SE of Thames and approximately 25km north of Newmont’s Martha Gold Mine. “This project is quite exciting because it has an existing historic JORC compliant resource, og 300,000 oz of gold and one million ounces of silver from both open pit and underground resources.” Henderson is about to go to the international market for funds to progress the advanced eipthermal project, named Neavesville, in a nod to one of the site’s historic mines, one of several that were explored in the 1890s. “The key thing about this project is that it already has a JORC compliance which takes if from a nice discovery with a few good drill holes, to a prescription the market recognises and has a fair degree of confidence in. “A significant gold and silver resource has previously been identified at Neavesville, with the potential to expand considerably.” A low strip open pit at the site has an inferred resource of 289,000oz of silver and 744,000oz gold, with an additional underground resource of 95,760oz silver and 312,000oz gold. The site is on mostly rugged, uninhabited Maori Trust land that has been largely unexplored over the last decade, says Henderson.

silver resource has previously been identified at Neavesville, with potential to expand considerably.” “Several different companies explored the area throughout the 1980s and 1990s, but when the Maori owners took over the permits around 10 years ago they chose not to explore it themselves.” When these permits expired due to the lack of activity, they went out for tender under the Newly Available Acreage tendering system and were picked up by off-shore company Eurasian Minerals Exploration. It recently sold the permits to Glass Earth Gold who has a partner in the project - “a significant New Zealand mining institution” - says Henderson. “This is a very exciting project for Glass Earth, as the area hasn’t really had a lot of modern work done on it. There are multiple new targets to test so we can gain a better understanding of the deposit geology and its potential.” Neavesville will also be explored under Glass Earth Gold’s “control and management” unlike its other major development project at WPK with Newmont where it has a 35 percent share. “To be able to deliver the Neavesville project on a more defined platform than we have in the past is an exciting step forward for the company.”

Glass Earth Gold is excited about the Neavesville potential.

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Summer 2012 » Mining NZ 11


Gold » Newmont Waihi Gold

Newmont Waihi Gold’s proposed Correnso underground mine in Waihi East will replace the existing underground Favona and Trio mines at Waihi.

Waihi businesses back Correnso Karen Phelps The resource consent submission process has ended for Newmont Waihi Gold’s Golden Link proposal and the wait has begun for the result. Around 500 submissions were made, including from Newmont Waihi Gold staff and the public. Golden Link, which could extend gold and silver mining operations to at least 2020, comprises two parts. The Martha Exploration Project is a small underground exploration programme located within the existing Martha mining licence area and the pit rim. This only requires a variation to the existing Martha mining licence. The more contentious part of the proposal, Correnso is a potential underground mine in Waihi East which, if it proceeds, will replace the existing underground Favona and Trio mines. This requires consents under the Resource Management Act to go ahead. Should the Correnso proposal proceed, underground mining would occur at considerable depth below some properties in Waihi East. The mining would occur in blocks starting at

the bottom of the ore body, which is 350 metres below the surface, and working up to the top of the ore body, at approximately 130 metres below the surface. Newmont Waihi Gold spokesperson Kit Wilson says early feedback has indicated that submissions are three to one in favour of the project. The proposal certainly seems to have the support of local businesses with those spoken to overwhelming in favour of the project. Diane Churcher has owned Quartz Café on Waihi’s main street for the past five years and worked there for about the same number of years before that. “We have a lot of regulars that come in every day from the mine. I think the town would become a ghost town [if the mine closed] I really do. A lot of the businesses think the miners don’t come in to their businesses but they do.” Churcher says her house is in the zone but will not be directly mined beneath. “If I was living out there [in the area directly to be affected] I’d probably be gutted,” she admits. “But I chose not to buy out that way. This has been going on for years so everyone knew.”

She says that Newmont Waihi Gold contributes a lot of money to the town. “Without them what would Waihi look like? How can I put this…” she pauses. “People get on a band wagon. It’s a cause to fight. They want something to moan about.” She points to when the Pye Television factory closed (which coincidentally is where Newmont Waihi Gold now has its offices). “When it shut down everyone thought what are we going to do? Then the mine opened.” Churcher is positive: “I think they’ll get approval for the proposal. They have a lot of support. Paul Anderson, owner of Diamonds on Seddon

since 2003 also supports the proposal. “As a business owner I’m for it. But I think this town is strong enough to survive on its own without the mine. “I think the mine is a big part and helps but I don’t think it’s the be all and end all. I think tourism could be huge here and I am a big believer that if one door closes then another opens.” He says Newmont Waihi Gold seems to be more environmentally friendly. “This town is full of holes [under the ground from historic explorations before Newmont Waihi Gold] but now Newmont Waihi Gold backfill everything.”

It is better for all parties if a mutually agreeable solution can be worked out before the hearings start. If this is not possible, then both parties have the opportunity to present their respective case in front of the hearings panel.”

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Gold » Newmont Waihi Gold Graeme Fowler started his business Fowler Surf and Fashion in 1973 well before Newmont Waihi Gold came on the scene. He says that the town has changed from the days when Pye was the main employer and says Newmont Waihi Gold has filled the gap and given continuity to the town in terms of employment and growth. “The whole town would be struggling without the mine.” Kit Wilson says Hauraki District Council staff will now be preparing a report that will be presented to the hearing panel. During the period leading up to the hearing Newmont Waihi Gold staff will also be approaching submitters to see if the issues they have raised in their submissions can be resolved. “This is usual in Resource Management Act applications. The applicant often meets with submitters – if they are willing – to work through the points which have been raised. “It is better for all parties if a mutually agreeable solution can be worked out before the hearings start. If this is not possible, then both parties have the opportunity to present their respective case in front of the hearings panel,” explains Wilson. He says that he anticipates that some points raised by some submitters could be addressed. “For example a number of submitters have expressed concerns about night time blasting. “At Trio we have consent to blast at night and we have a maximum of eight ‘blast windows’ in a 24 hour period. In the Correnso application we have not applied to blast at night (8pm to 7am), and we have reduced the number of ‘windows’ to three and also suggested a reduction the maximum vibration allowed.” Newmont Waihi Gold has already established a Community Forum made up of local body representatives, company representatives and elected locals to oversee and if necessary review the company’s voluntary property and community investment policy. The first job of the Forum will be to appoint an independent review panel which will act like an ombudsman for property matters in the Golden Link Project Area. The Golden Link hearing is scheduled for December 3.

Newmont team does well across Tasman A team of rescue personnel from Newmont gold mines in New Zealand and Australia have won a number of awards at the recent 2012 Mining Emergency Response Competition (MERC) held in Perth. Newmont Waihi Gold mines rescue captain Dave Oliver was the sole Kiwi member of the team and it was the first time he had competed in such a competition. “The emphasis is to knowledge share and gain experience. That’s the reason we turned up and the awards were just a bonus. None of us in the team had really competed before so we didn’t know what to expect so to have done so well was a pleasant surprise,” says Oliver. The Newmont team was comprised of representatives from Newmont sites in the Asia Pacific region. Oliver says one of the biggest challenges was to ‘gel’ together in a short space of time. “We basically had just four days together to prepare for the competition. We had to learn fast which skills we were each good at.” Ten teams from all over Western Australia competed including representation from Anglo Gold Ashanti, Saracen, Birla Nifty, Fortescue Metals Group, Newmont, Premier Coal, Minerals Mining Corporation, BHP Billiton Iron Ore, McMahons and Newcrest. Oliver headed the Newmont team and the competition, which took place over two days, involved a series of intense 45 minute events covering various aspects of mine rescue. The Newmont team gained two firsts, two seconds, and three third places. “To only have been together for a few days and then produce this sort of result is really impressive,” says Newmont Waihi Gold's Emergency Services Advisor Pete Lowe. “From our point of view there's also another

Dave Oliver: “We were rapt to get some recognition....” really important aspect to the way this team worked. It vividly demonstrated that we have standardised procedures across countries and sites and having the same equipment and techniques provides us with the flexibility we need across the industry. “It's comforting to know that we have teams just like ours who are only a plane ride away should we ever need them, and of course we are ready to assist at other sites should the need ever arise.” Oliver says there are few opportunities for mine rescue workers to practise their skills in a competitive environment in New Zealand. He likens it to being trained to play rugby but to rarely get to actually play a game. “It’s not until you compete against other

teams that you know that we have the specific skills needed. “Rescue is about problem solving and decision making. We had the right guys in the right positions on our team. “We were rapt to get some recognition and to do as well as we did.” Newmont's team results: Hazardous Materials and Breathing Apparatus Skills - first Firefighting and Breathing Apparatus Skills - second. First Aid - second Overall Team Safety - third Emergency Response Team Readiness - third Overall Breathing Apparatus Skills - third

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Gold » L&M Mining

Earnscleugh starting to ramp up Jo Bailey L&M Mining’s first year of full-scale gold mining on the Earnscleugh flats, near Alexandra has gone smoothly, says mine manager, Mark Coleman. “There have been no major hiccups and the plant is running well. We’ve reached the point where we’re fine tuning our operating systems and getting production up to where we want it to be.” The Earnscleugh project is one of the largest alluvial gold-mining operations in the country. L&M Mining expects to get about 110,000oz of gold from the 150ha site over the seven-year life of the project. Coleman says production is meeting these targets so far. “It’s working out pretty much as we expected. We’re not far off peak production although there’s always room for small improvements. This is an ongoing process - we’ll still be fine tuning things in a couple of year’s time.” Coleman works for Southern Earthworks that is contracted to operate the mine on behalf of L&M Mining.

He has worked on the project since “day one” when he arrived at the site with just himself and a digger around three years ago. The first stage of the project lasted for about a year and involved recovering gold using a scaleddown version of the current plant. “We used the small plant to test that we had the right systems and technology in place before we moved into full-scale gold mining.” Around $3 million was spent on totally upgrading the larger gold recovery plant before it was moved to the site and started operating in midSeptember 2011. The plant weighs 850 tonnes when loaded, measures 12 metres by 30 meters and floats in three to four metres of water. It is operated by a crew of three, with a digger driver and two staff on the plant rotating jobs every two hours. Around 150 cubic metres of gravel is processed by the plant every hour. The resultant fine gravel is then taken to another location for screening to retrieve the gold. “The plant is moved along as an area of the mine site is completed,” says Coleman.

More then 30 staff currently work across the whole operation, with several new positions recently advertised as production ramps up. Coleman says the company has a policy of employing people from the local district. “Everyone working on site at the moment is local, as are all the contractors we use and engineers who come in for maintenance shutdowns.” The size of the Earnscleugh mine was scaled down to 150ha from L&M Group’s earlier plan to mine 255ha as granted by resource consents in 2001. All appeals against the consents were cleared by mid-2004 but it wasn’t until 2009, with rising gold prices that the company decided to progress the project.

The majority of the area to be mined is farmland on what was a virgin site. It is located not far from the conservation-protected historic area of heaped gravel dredge trailings left by the steam-driven bucket dredges of a century ago. Around 14 million cubic metres of gravel wash and 32 million cubic metres of overburden will be processed over the mine’s life, with the wash containing a higher gold concentration. Phase two of the project is due to be completed in late 2015 or early 2016, with restoration of the site scheduled for completion by the end of 2016. “We are very happy with the progress of the mine to date. Things are going pretty well and we have a great team of people here which makes all the difference,” says Coleman.

We’re not far off peak production although there’s always room for small improvements .... we’ll still be fine tuning things in a couple of year’s time.”

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Gold » L&M Mining

The Earnscleugh alluvial gold mine near Alexandra - around 14 million cubic metres of gravel wash and 32 million cubic metres of overburden will be processed over the mine’s life.

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Gold » Strategic Elements

Geophysical data seen as essential Jo Bailey The discovery of significant sulphide mineralisation at its wholly owned Mandamus project on the east coast of the South Island is “highly encouraging” for Strategic Elements (ASX:SOR) in its quest for rare and precious metals. Charles Murphy, managing director of the listed Australian company that funds projects in the minerals sector, says high sulphide levels are invariably associated with precious metal deposits and can indicate the type of intrusion style deposit the company is looking for. ”Intrusions host some of the world’s largest mineral deposits, but have been largely ignored in New Zealand because of the lack of geophysical data that is often required to discover them. “In Australia there is an enormous amount of geophysical data provided by the government that enables exploration companies to see beneath the surface, however the New Zealand government has only recently started providing this type of assistance. “We believe this will result in a lot more activity around intrusion style deposits going forward.” He says Sam’s Creek, the OceanaGold/MOD Resources joint venture project near Nelson is a

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16 Mining NZ » Summer 2012

recent example of how geophysics can assist in the potential discovery of intrusions. “The company flew its own geophysical survey at Sam’s Creek, revealing a magnetic anomaly that could well be a large buried mineralised intrusion.” At Mandamus, Strategic Elements has already identified several areas where outcropping rocks have been strongly altered by fluids and have risen up through the intrusive complex - which can indicate precious metal concentrations. “We are seeking to develop a first mover advantage by picking up the best intrusion-related projects we can find. “We’re certainly pioneering a bit on the east coast of the South Island, where we have an exploration permit at Mandamus and a prospecting permit application for the nearby Blue Mountain project - both in the Inland Kaikoura mountain range,” says Murphy. The intended exploration programme at Mandamus will include sampling of creeks draining the intrusive, rock chip sampling coverage of the entire intrusive complex, geophysical surveys and drilling where appropriate. Murphy says Strategic Elements is looking forward to the first release of New Zealand government airborne geophysics data over the West Coast, which will include information about the company’s Reefton South project area located 3km along strike (and under cover) from the Reefton goldfield. “The size of our West Coast ground holding increased significantly earlier this year. “We now have prospecting permits covering roughly 1000sqkm on the West Coast, from the southern extension of the Reefton permit which runs from the Snowy River area down to about Bell Hill; with the Hohonu permit continuing from Bell Hill to Mount Bonar.” The Hohonu permit covers over 10 separate intrusions of granite that form a belt of mountains adjacent to the Alpine Fault. The two primary areas of rare metal mineralisation are at Mt Rangitoto (tin,tungsten,tantalum) and Hohonu Range (rare earths, zirconium, hafnium). Murphy says the modern ‘under cover’ exploration approach using geophysics data means the prospectivity of many intrusive areas in New Zealand are “completely wide open”.

Strategic Elements has a prospecting permit for the historic Golden Blocks goldfields.

Intrusions host some of the world’s largest mineral deposits but have been largely ignored in New Zealand because of the lack of geophysics data that is often required to discover them.” Strategic Elements’ other main project in New Zealand is the historic Golden Blocks goldfields, where it has a granted prospecting permit. The 131sqkm project includes five historical mines with “significant potential upside from two separate styles of gold mineralisation, says Murphy. “We’ve secured the Golden Blocks area for two reasons. The first being the occurrence of gold in granite dykes (rock that has intruded through other rock and squeezed up to the surface) that have potential to be sourced from a larger intrusion of granite at depth. “The company that originally discovered the dykes that hold the nearby Sam’s Creek gold deposit reported that occurrences of dykes near Golden Blocks indicate the potential for a similar system. “The second is that the old producing mines that made up the historic Golden Blocks goldfield have never been explored with modern methods.

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”Historical records show the sites were mined down to roughly 100 metres in depth, however mining ceased there in around 1913, largely due to the mining machinery of the time, problems with water and other non-geological reasons. “We believe there is potential to extend beneath where the old mines stopped and plan to aggressively explore the entire area once all permits are granted.” Murphy says the company is pleased with the strategic position it is growing in New Zealand across a number of rare and precious metal projects. “We’ve been very active in the South Island and can see a lot of potential here. “The permitting system is very good, the government is supportive of the industry and we don’t have any issues with corruption. “We’re very pleased to have made the decision to concentrate on New Zealand.”


Gold » Industry News

Rising costs force industry rethink Karen Phelps Mining companies are being forced to cut costs as high costs hit the industry. Production at Newmont Waihi Gold is down 30% this year, which has resulted in a number of redundancies. Newmont Waihi Gold external affairs manager Sefton Darby says there will be approximately five immediate redundancies and around five staff will be moved to other parts of the operation. Darby says the company has looked at cutting costs in several key areas: future projects, exploration and administration budget. “For example there has been a shift in our exploration projects from regionally to closer to Waihi. One notable exploration project we have dropped out of completely,” says Darby although he is quick to note that the company is still actively pursuing the Correnso project. “We have cut a few management positions and beyond that we have to get pretty rigorous about what our priorities are: to maintain our current levels of production and get through the Correnso consenting process.” Paul Whelan, deputy chief financial officer for OceanaGold Corporation says that the increase in the capital costs of equipment has impacted on

Everyone is hopeful things will pick up but when it does it will take a while for us to ramp our business up.”

lease expenditure adversely as with all other cost increases which includes labour, tyres and general costs. But it has not only been costs but lead times which have been impacting the business. “In respect to mining equipment the lead time from order to delivery has been particularly frustrating with lead times in excess of 52 weeks on some items.” Whelan thinks the industry as a whole needs to improve productivity. He says that two ways this is possible is through increased automation or by using larger equipment but acknowledges that both options have a high price tag. He says in response to industry pressures OceanaGold has decided to invest time and resources into a business improvement framework which is call Performance Excellence Program (PEP) to improve productivity and create efficiencies in all aspects of the business. State-owned coal miner Solid Energy has been hit by both high costs as well as falling international prices and has announced plans to axe hundreds of jobs at mines near Greymouth and Huntly. The issue is also having a trickle-down effect to businesses that contract to the industry. Darby from Newmont Waihi Gold estimates that around 20 contractors could be affected by its cut backs. Hugh McMillan, New Zealand business manager of minerals for SGS, says the issue has been the leading cause of a number of redundancies and redeployments to other areas of the business. He is not sure how many people may be affected. “We need to let the dust settle and staff up to appropriate levels that the industry is demanding. “It also means that we are probably not going to invest as much in future technology as we could have if things were more buoyant.” He thinks that there will be a long term effect on the industry.

Production costs are on the rise in the global mining industry. “Everyone is hopeful things will pick up but when it does it will take a while for us to ramp our business up. We are going to lose trained staff and it will take time to get appropriate staff and get them trained.” One supplier to the industry who did not wish to be named said it was just a matter of getting on with things. “It’s a known cycle and you have to plan and be prepared for that. It’s uncomfortable and it does mean that there is suffering and you have to have empathy for that. “But the bottom-line is this is how business works and it’s not a surprise. The real problem is that people think growth is a thing that always happens and have their business based on growth which is ludicrous.”

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Whelan believes costs will continue to trend up, “although perhaps at a slower pace than we have experienced over the past two to three years”. “Companies are also choosing in many cases to not bring production forward but rather are reducing cut off grades which in-turn extends the mine life of projects. “This results in higher unit costs but these can often be offset with the higher commodity price environment we are experiencing.” Darby says it’s almost a case of “self-inflicted wounds” with the entire global mining industry growing at the same time, chasing the same pool of resources and forcing price rises. “On a global level if we start to see a bit of a scaling back of mining projects as we are seeing in Australia prices will drop.”

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Gold » OceanaGold

Celebrations on Birthday Reef project (Jon Gane, Hamish Blakemore and Philip Jones) and a good working relationship with the Titeline drilling crew has led to its success. A “fair degree of technology” was also required to drill 1.6 kilometres below the ground surface and around 680 metres directly below the historical mine workings, he says. “There aren’t many drill rigs capable of drilling hardrock down to these depths. It is quite a technically challenging thing to do. “However we were fortunate to get Titeline Drilling with their 1200 HC Universal Drill Rig, capable of drilling HQ (63mm diameter) down to 2000 metres.” He says the rig on site at Blackwater has been drilling “day and night” for almost a year to assess the high grade potential beneath the old mines. Mustard and his team are now working on the next drill hole (WA25) that is designed to test the northern strike extent to the Birthday Reef well beneath the historical workings. “This hole is now underway and drilling will continue for several months. “Results of this programme are expected early in the second half of 2013.” Mustard, an exploration manager with 20 years industry experience has been based in Dunedin for two years after shifting his family across from Australia. Before the move he spent a year commuting to OceanaGold’s Reefton Exploration operations. He is enjoying leading the exploration team on its successful programme, and looks forward to the results of a technical study into the viability of an underground operation. This will be completed by the company’s project development team using data collected from the drilling programme in the first half of 2013. “We expect to see some results in the second quarter of 2013 which will hopefully lead to future mine development – the ultimate result of any exploration programme.”

Jo Bailey OceanaGold’s successful drilling programme at the historic Blackwater mine is “a great news story” for the small town of Reefton and for the West Coast, says Roger Mustard, the company’s New Zealand exploration manager. The company has announced encouraging second round results from its deep drilling programme at the Blackwater (Birthday Reef) mine. The high-grade gold project is located in the Reefton Goldfield around 15km from its Globe Progress mine, and 37km from Reefton township. Mustard says that they have successfully intersected the Birthday Reef on two occasions in recent months, deep below the previously mined workings of the historic Blackwater mine that was closed in 1951. Blackwater was the largest historical producer in the Reefton Goldfield, producing approximately one third of the two million ounces of gold produced from hard rock sources. In OceanaGold’s latest drilling programme the parent hole WA22C intersected 0.61 metres at 15.65 g/t Au. The daughter hole, WA22D (11 metres from the parent hole) intersected 1.13 metres at 85.2 g/t Au. Mustard says the Birthday Reef is “a simple, relatively planar, steeply dipping quartz vein striking north-north-east for around one kilometre”. “What is unique about this deposit is that it is very consistent in width and high grades along the strike and down plunge; and the good news is that the recent diamond intercepts are within the range. “The results couldn’t be more encouraging.” Mustard says the last previously successful drill hole was made back in 1996. He says OceanaGold’s commitment to investing in the multi-million dollar exploration programme, combined with the dedication and technical skills of the Reefton exploration geologists involved in the

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Gold » OceanaGold

Drilling results a highlight in latest quarter The drilling results from Blackwater were a highlight of OceanaGold’s latest quarter result. OceanaGold chief executive Mick Wilkes said the company was “very pleased” with the continued success of the exploration drilling programme at Blackwater. “Our project development team is now starting to assemble data in preparation for technical study work in the first half of 2013 while we also await results from the current hole testing of the northern extent of the orebody.” This technical study will assess the viability of a narrow vein, underground operation at the Blackwater mine. “With the results from the current drill programme increasing the known extent of mineralisation, the project team will evaluate various mining scenarios with a view of targeting a production rate of circa 50,000-60,000 ounces of gold per annum,” says Wilkes. This study is expected in the second half of 2013. Meanwhile a lift in gold prices helped OceanaGold lift its third quarter earnings, despite a dip in production. In its third quarter result, released on October 30, OceanaGold reported EBITDA of $28.6 million, up 12% on the previous quarter following a 5/.1% lift in revenue over the second quarter to $91.2m.

OceanaGold’s Reefton plant - the company is moving along with its exploration programme in the goldfield. This was due to an increase in gold ounces sold and a higher average price received, with an average of $1665 per ounce. However gold production in the quarter was 49,514 ounces, down from the second quarter of 55,709 ounces.

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Meanwhile Wilkes said the company had made “tremendous progress” at the Didipio Project in the Philippines where construction was nearing completion. “We are pleased to announce the

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Summer 2012 » Mining NZ 19


Coal » Bathurst Resources

Drill results confirm coal resource Most of the semi-soft coking coal produced at Cascade is destined for export to the global steel industry and ferro silicon markets, with around 45,000 tonnes a year supplied to Holcim New Zealand for cement manufacture. “We have a great relationship with Holcim whose needs will increase in coming years to meet demand from the Christchurch rebuild,” he says. Bathurst is awaiting final approval for its flagship Escarpment project on the Denniston plateau, with hearings at the Environment Court due to wind up in early December. The company’s Coalbrookdale mine is already permitted, and Bathurst expects to start the process to permit Whareatea West once the Escarpment mine is licensed. Two drill rigs continue to work across Bathurst’s

Jo Bailey Contrary to reports indicating Bathurst Resources’ Buller Coal Project contains bigger coal reserves than first estimated, managing director Hamish Bohannan says the company’s drilling programme hasn’t revealed “any real surprises”. “The resources haven’t changed much at all. What the drilling programme has achieved is confirmation of the amount and quality of coal across our permits. “We haven’t found any more coal but have confirmed the coal we thought was there.” Since October 2011, Bathurst has conducted a drilling programme of 154 holes across its North and South Buller permits. Changes to classification of the resource status have seen an overall increase in confirmed resources and reserves of 76 percent to 23.8 million tonnes (mt) of product coal in the South Buller area. This is largely due to an additional 9.6mt in reserves across Bathurst’s Whareatea West, Coalbrookdale and Cascade projects. The confirmed reserve for Escarpment has also increased to 3.8mt up from 3.1mt as previously reported. Investors responded positively to the news in early October, with a jump in Bathurst’s shares from 50c to 57c straight after the announcement. By 8 November the share price had settled back to around 51c. The company’s financial report for the year to June 30 revealed plans to increase its Cascade mine to an annualised production of 150,000 tonnes.

Hamish Bohannan “During the port upgrade works we have taken the opportunity to cut-back, or take the rock off the top of the coal at Cascade so that as soon as the new storage shed is finished at the port we can significantly ramp up coal production,” says Bohannan. Cascade miners have already been working in two shifts, around the clock for several weeks – a regime that will continue throughout the summer months. Bohannan says Bathurst recently took on an additional 14 staff at Cascade - former contractors who had worked at Solid Energy’s Stockton mine before being laid off. “The team has all got straight into the new schedule and it’s going without a hiccup. We’re very pleased with progress.”

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20 Mining NZ » Summer 2012

North Buller permit and baseline environmental studies are ongoing there, but it will be some years before this project reaches production, says Bohannan. Bathurst Resources is also continuing to support the local community through a range of initiatives, he adds. “We have just announced next year’s scholarship for a Buller High School graduates going on to university; and have recently started working with the Dingle Youth Foundation that we plan to assist to expand its activities in the South Island and develop a presence on the West Coast where it is not currently represented.” Plans are also underway for an Open Day to be held at Bathurst’s Takitimu mine at Nightcaps in late February.

Bathurst Resources is ramping up production at its Csacde Mine to 150,000 tonnes a year.

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Coal » Bathurst Resources

New wharf building on schedule Jo Bailey The construction of Bathurst Resources $5 million storage building on the Westport wharf is progressing well says the company’s managing director Hamish Bohannan. “The five month project was 74 percent complete in the first week of November which is slightly ahead of plan. We expect it to be finished on schedule in December.” The development is part of Bathurst’s planned $30 million upgrade of the port, and is an important step in the company’s long-term commitment to the Westport community, he says. “There’s been a degree of scepticism in the community about the project because they have been let down by other proposed port upgrades in the past,” says Bohannan. “It is very pleasing that we are able to fulfill our promise and commitment to develop the Port of Westport into a first class bulk handling facility.” Nelson-based firm Brightwater Engineering has designed and is constructing the shed that will replace the existing open storage area. The facility will hold about 9000 tonnes of coal that will initially be received by truck and later, by rail via an overhead conveyor. After storage, the coal will be transferred into a hopper located within the shed which feeds onto the existing ship loader. The new facility will enable Bathurst to load vessels at either the river wharf or, later, at the inner wharf in the Westport floating basin.

Exciting times; from left, Bathurst Resources chief operating officer, Richard Tacon, Eastern Coal general manager, Craig Pilcher, and Buller District Mayor, Pat McManus on site at the Westport wharf. Bathurst has been using the existing port facilities to ship coal from its Cascade operation on the Denniston Plateau. The upgrade will enhance the company’s route to market for production from this mine, and improve port infrastructure in anticipation of production from the adjacent Escarpment Block. Bohannan says the next stage of construction, subject to the necessary approvals being

obtained, will include the installation of an aerial transportation system to largely replace the trucking fleet bringing coal into the facility. “We are in the process of working with consultants and getting the necessary environmental assessments done for this stage of the project before moving on to the full approval process early next year.” The construction of the storage shed is being

undertaken in conjunction with Westport Harbour Limited. The company suffered the unexpected death of Nico Weeda, its port manager/harbourmaster in early November. “Nico was a great guy to work alongside and we were very saddened by his passing,” says Bohannan. “Our condolences go out to his family, friends, and colleagues at Westport Harbour.”

Taking a winning approach Beca offers integrated solutions to mine owners and operators by providing planning and consenting, engineering design, operational efficiency and project management services. An extensive track record, depth of technical capability and commitment to rigorous quality and safety positions Beca as a world class engineering company able to service a wide range of project requirements from front end engineering studies, detailed engineering, procurement and construction management (EPCM) through to shutdown management, site support and commissioning assistance. “Our approach emphasises quality, safety in design, innovation and environmental sustainability,”Beca’s Ross Plumpton. “Our broad engineering capabilities mean we can meet a broader range of on-site and off-site infrastructure design needs. We also offer a toolbox of front end study and planning services including permitting and consenting. “Our experience has been used on projects for nickel, gold, coal, quarried aggregate and iron-sands clients in New Zealand, Australia, New Caledonia, Indonesia, Fiji and Papua New Guinea.” Beca supports the development of a mining and minerals processing projects throughout the full project life-cycle, from investment planning and project definition, design and construction, operations through to closure and decommissioning. With a wide variety of engineering disciplines and staff who regularly work with mining and minerals processing clients, Beca can design on-site infrastructure such as site roads, airstrips and accommodation camps, water distribution and storage facilities, water treatment, wastewater and storm water management systems, site power systems and chemical and fuel storage. Beca also has a track record in successful process improvement projects within the mining and metals sphere.

Beca has been leading a programme with a major New Zealand industrial client for several years to lift performance with respect to maintenance and plant reliability. The project has applied reliability-centred maintenance techniques to develop plant maintenance strategies and shift maintenance practices from reactive to proactive, thereby reducing through-life costs. This has included a campaign of training and mentoring to carry the initiative forward. Beca’s Asset Services assist clients in managing their assets more effectively. These include Lean Six Sigma capability, which helps clients reduce waste and non-value adding processes, and streamline operations. Beca’s approach provides mining companies with tools to survive in a global market that demands higher quality, faster delivery and lower prices. Areas of special competency include: Engineering and design services: Mine concentrate and tailings handling systems Dredging, reclamation and dewatering management and treatment facilities Integrated site water management strategies Design of materials handling solutions including conveying, stacking, reclamation Haul road design, bridges and intersections Mine support infrastructure design including power systems, water supply, waste treatment Co-generation facilities Gas handling solutions including steel plant waste gas, coke-ovens gas and methane, and process off-gas Process and dynamic modelling Complete multi-discipline engineering services covering process, mechanical, civil, geotechnical, structural, electrical, controls and instrumentation Engineering standards and procedures.

Summer 2012 » Mining NZ 21


Porter Equipment

Porter Group stakes claim in South Jo Bailey The South Island mining sector is a key and growing market for Porter Group – New Zealand’s largest supplier of new and used heavy equipment. One example is the strong relationship that has developed between Porter Equipment and Bathurst Resources – with its Dunedin branch providing Bathurst’s Takitimu mine with Hyundai 7 loaders that are the “pivot” of the mine’s operation, says Takitimu’s mine manager, Darren Prentice. “We’ve had a great run with these machines. They are total workhorses and with good operator comfort our guys are happy to operate them.” Prentice says the mine enjoys a good relationship with the Porter Equipment Dunedin team, singling out territory manager Wayne Cunningham; and serviceman, Logan Flowers who provides regular one-site servicing and maintenance. “They are good, approachable guys who deliver not only on pricing, but also excellent back up and service. Everything stacks up which is why we’re looking to purchase a new Hyundai 9 Series loader from them in the near future.” Hyundai is a key brand for Porter Group that has a number of features well suited to the mining and quarrying industries, says Wayne Cunningham, whose territory covers a “vast” area from Oamaru south. “They are robust machines that are really built for the job. Hyundai takes their business in New Zealand very seriously. We are visited by their research and development teams from the Korean factory several times a year to improve the design-ability of the machines and ensure they are adaptable to New Zealand conditions.” Cunningham is excited at the evolution of Hyundai’s Series 9 loader and excavator range, with improved ergonomics in the cabs for operator

22 Mining NZ » Summer 2012

Korean equipment manufacturer Hyundai is a key brand for Porter Group. comfort and the ability to track their performance in live-time through GPS. “Our service guys can effectively look straight into the machine’s brain, or computer, and get the full story of how the machine is operating.” He says there is strong demand from the coal and gold mining sectors for both new and used Hyundai product. “We also supply used equipment right up to Hyundai 120 tonne excavators, and our biggest loader, the 30 tonne HL780-9. With Porter Group being a truly international company we are also

able to source near new, low-houred machines from off-shore for clients to their specifications.” Porter Group established its Dunedin operation three years ago to service the mining and civil sectors in the region. It is part of a concentrated nationwide service network of 26 centres. Porter Equipment is a leader in equipment sales – with the highest sales of new excavators and wheel loaders in New Zealand every year since 2005. This part of the group’s operations are complemented by associated divisions including

Porter Hire, which has the largest rental fleet in the Southern Hemisphere and also services the Takitimu Mine; Porter Access; Porter Cranes; and Porter Haulage. These divisions are backed by additional specialist support divisions Porter Parts and Porter Mechanical. The group supports and sponsors numerous initiatives at both a national and local level, something Takitimu mine manager Darren Prentice has experienced first hand through its sponsorship of a junior rugby team.


Finance »

Changes loom for mining taxation Govt seeking feedback

Don MacKenzie

The Inland Revenue has completed its review of the tax rules which currently apply to specified minerals. The output from this review is the release of a discussion document which proposes to remove certain tax concessions. At the same time the Ministry of Business, Innovation and Employment released a discussion document which proposes to increase royalties payable to the government by mining companies. Specified minerals are defined in the Income Tax Act and currently include 46 minerals – including most metals (such as gold, silver and platinum). The current regime is essentially unchanged since the 1970’s and is very concessionary to taxpayers. The Government’s motivation for the reviews was that not enough revenue is collected from those involved in the industry. The mining industry is an easy target for the Government as it has proven itself to be reasonably recession proof during the recent global financial crisis. One of the key tax benefits of the current regime is that a mining company is able to claim a deduction for all of its exploration and development expenditure in the year it is incurred. A deduction is even available for what would normally be considered capital expenditure. Under the proposed changes a mining company will still be able to claim these deductions for the exploration phase, but exploration deductions will be clawed back once a mine is developed for items which continue to be used to extract minerals. A deduction will also still be allowed for mine development expenditure, but this will be spread over the life of the mine. This is consistent with the approach currently used for the mining of nonspecified minerals. Profits may currently be deferred for up to two years provided the taxpayer intends to reinvest the profits in further exploration or development. There is also the ability to defer the tax impact of insurance receipts and the ability for tax losses to be carried forward after a change in shareholding. Under the proposed changes all of these concessions will be removed.

The Government is eyeing the mining sector to increase tax and royalty revenue. A further proposed change applies to land acquired for prospecting, exploration or mine development. This land will be deemed to be revenue account property, meaning that any gain derived on disposal will be taxable, and any loss incurred on disposal will be deductible. Changes are also proposed for expenditure incurred to restore or make safe land once mining activities have ceased. A deduction will be allowed for this expenditure, and where a company makes payments to the Inland Revenue in earlier years for the tax effect of expected restoration expenditure there will effectively be a mechanism for carrying these deductions back to profitable periods. The Government doesn’t just collect corporate tax from mining; it also collects royalties for the minerals extracted.

The mining industry is an easy target for the Government as it has proven itself to be reasonably recession proof during the recent global financial crisis.”

The royalty discussion paper proposes a number of changes to the current system of mineral royalties. The current system is a mixture of fixed amounts per tonne and a percentage of annual net sales depending on the mineral being mined. The proposed changes will move to the higher of 2% of annual net sales (1% for underground coal gasification) or 10% of accounting profit. The accounting profit will only be used for coal if it exceeds $2m or for gold and silver if it exceeds $5m. These changes would only apply to new permits with the existing rates continuing to apply for existing permits. The discussion document compares the proposed increased royalties and tax rates against those charged in a range of other countries and concludes that New Zealand would still generally have the most competitive mining regime. In addition the analysis concludes that the increased royalties would only prevent new mining activity in the most marginal of sites. If your business is currently covered either by the specified mineral regime or you pay mineral royalties to the Government, you need to act quickly. Submissions on both discussion papers must be made by no later than December 7, 2012. Don MacKenzie - Partner Deloitte

The Government is calling for public feedback on its proposed changes to the taxation of minerals and mining royalties. Two papers – Reviewing the Royalties Regime for Minerals and Taxation of Specified Mineral Mining – have been released for public consultation. The royalties paper focuses on the royalty rates applied to coal, gold, silver, platinum group elements, ironsands, phosphates and seafloor massive sulphides. The taxation paper focuses on the tax rules that apply to miners of specified minerals, including gold, silver and ironsands. The tax paper excludes coal, while both papers exclude oil and gas. Energy and Resources Minister Phil Heatley says there is potential for the industry to contribute more in tax and royalty revenue. “New Zealanders are generally comfortable with mining so long as it’s done safely and responsibly, with a strong regulatory framework. “And they know that the royalties and taxes the Crown gets from mining companies pay for hospitals, school and roads. There is real potential for that contribution to grow.” The royalties review recommends higher royalty rates for large and highly profitable mining operations. However, the new rates would only apply to new permits – existing permits and licences would retain the royalty rate that currently applies. “The suggested rates in the royalty review would ensure that New Zealand receives a fair financial return from future development of its mineral estate,” Heatley said. Revenue Minister Peter Dunne said it was also important mining companies paid an appropriate level of tax. The tax paper suggests more closely aligning the current concessionary tax regime for certain minerals with general tax principles that apply to other forms of investment. Specifically, it suggests removing immediate tax deductions, or in some cases tax deductions in advance, for expenditure that would normally be capitalised and depreciated over the useful life of the asset. “This approach is in line with the Government’s continuing focus on ensuring that everyone pays their fair share of tax.”

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SILODEC »

Accuracy and reliability in weighing We remain committed

Karen Phelps SILODEC is able to provide an electronic weighbridge conveyor belt and an on-board weighing solution regardless of vehicle combination or application. The company offers the finest quality weighbridge solution with standard weighbridge sizes ranging from eight metres through to 25 metres with a maximum capacity of 80 tonnes. “The platforms superior design and construction is comprised of various removable panels and utilises advanced welding techniques which guarantees both a high level of strength and wear resistance with a perfect fit between panels,” says SILODEC company representative Steve Dale. Each panel is constructed of 6mm u-shaped beams topped by 8mm checker plate ensuring the vehicle adheres to the surface perfectly. The weighbridges can be mounted either directly onto an existing hard surface or pit mounted. All weighbridges come with fully hermetically sealed (IP68) stainless steel load cells and offer one of the lowest profiles on the market today, and with electronics backed locally in New Zealand with support available 24/7. “We are able to offer a wide array of packaged options specifically suited to the customer’s site requirements, from a basic display simply offering weight only through to a fully automated unmanned weighbridge complete with numberplate recognition and barrier arms and able to link directly into their invoicing system to streamline their accounts process,” says Dale. “And because we can tailor a solution specifically for our customer’s needs this means they are not paying for features that they don’t require,” he says.

to our customers before and after their purchase. That’s what makes us a leader in electronic on-board weighing.”

The BeltWay conveyor belt scale features an easily installed modular design.

The company’s BeltWay conveyor belt scales provide outstanding accuracy in conveyor belt weighing with reliable in-motion weighing and optional connectivity to a printer, PLC or computer. The BeltWay conveyor belt scale features an easily installed modular design. A wide range of products and accessories is also available. Dale says something that sets SILODEC apart is its unparalleled before and after sales support and service. “We remain committed to our customers before and after their purchase.

Outstanding accuracy and reliability in conveyor belt weighing

“That’s what makes us a leader in electronic on-board weighing. “Once our weighbridge or beltway has been installed either by our customer or by one of our factory trained staff we will calibrate the scale specifically for our customer’s requirements and train their operators in its use and functions. “Once this training is complete additional support is available from us 24-hours a day 7 days a week.” SILODEC started more than 20 years ago in New Zealand and since that time has remained

at the forefront of innovative electronic weigh technology. Product is manufactured under strict international standards ISO 9000 and SILODEC provides full warranty on parts. Dale says that SILODEC has always been dedicated to sourcing and manufacturing product of the highest quality to meet its customers’ requirements. “SILODEC is the only company offering a vast array of extra add-ons and features as off-the-shelf solutions,” he says. “We are almost always able to tailor specific requirements to meet our customer’s needs including printers, remote displays and overload warning system. We are able to interface with most of the available GPS and fleet management systems in use today. “At SILODEC we constantly strive to develop and improve on our products. We are continuously coming up with improvements and tailoring solutions for the ever changing requirements in today’s modern transport industry.” www.silodec.co.nz

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On the Job »

Geologist enjoying the challenges You never get bored

Karen Phelps As a child Shannon Richards remembers walking along the riverbeds of Zimbabwe looking for pretty rocks. So it is no surprise that she is now an underground project geologist for Newmont Waihi Gold. Richards grew up in a mining town in her home country and her family sometimes fossicked for gold. She studied arts at school before moving into sciences and completing a degree at Rhodes University in South Africa followed by a master’s degree at Stellenbosch University which saw her mapping rock formations in the deserts of Namibia sponsored by AngloGold Ashanti. Richards arrived in New Zealand seven years ago to visit family, fell in love with the country and never went back home. She ended up in Waihi as her mother was based there and says she was lucky it happened to be a mining town. “I just kept coming to the door of Newmont Waihi Gold reception for a few months asking if they had any positions until finally they said yes,” she says with a smile. She started her career with the company core logging exploration drill cores. A year later she had moved into regional exploration mapping areas of bush and farmland, taking rock and soil samples as well as undertaking geophysical surveys. She then worked underground doing ore control. This involved ensuring the mining was following the gold carrying vein. Richards’ job involved geological mapping and chip sampling the end of each tunnel to ensure the samples contained gold.

as there are lots of jobs going on all the time and information can come in that might change everything we thought would happen, so I have to then quickly make a new plan.

Shannon Richards - project geologist for Newmont Waihi Gold.

Nowadays her role means that she no longer spends much time underground but rather in front of a computer. “We do a lot of diamond drilling to delineate where the veins are before we mine them. My main job is to plan these holes and to make

a three dimensional geological model on the computer defined form the from the diamond drilling,” she explains. The model is used to run statistics to make sure it is economically viable to mine before Newmont Waihi Gold actually start the process.

Richards also mentors the ore control geologists who come to her with any questions regarding the geology they see underground on a daily basis. Richards says she thrives on the fast paced environment of her job. “You never get bored as there are lots of jobs going on all the time and information can come in that might change everything we thought would happen, so I have to then quickly make a new plan. “It’s challenging interpreting what will happen before you mine the veins and I love that challenge. “Geology has so many niches that it is a good career for many different types of people no matter where their talents lie.”

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Summer 2012 » Mining NZ 25


Quarrying » Wharehini Quarries

Premium aggregates in demand Karen Phelps Wharehine Quarries has been involved in some of Auckland’s most significant projects such as New Zealand Transport Agency’s Northern Gateway Toll Road between Orewa and Puhoi. “Premium-grade aggregates from Wharehine Quarries are an integral part of much of our region’s infrastructure and have been for more than 50 years,” says company director Steve Dodd. Dodd’s uncle was one of the founding members of the Wharehine Group, a privately owned civil contracting and primary resources company, which has its roots set back in the early 1950’s when it commenced quarrying and earthmoving operations in the North Auckland region. Since 1997, the company has been owned since 1997 by Dodd and Phillip Schmidt. More recently two new director/ shareholders joined the ranks Rob Gibson and Ant Frith. Wharehine Group operates seven integrated divisions: construction, quarries, Wharehine readymix, transport, landscape, mechanical and land development. Greywacke rock from Wharehine’s Millbrook and Matakana quarries has now paved literally thousands of kilometres of roads throughout the North Auckland Region. During construction of the Northern Gateway Toll Road Wharehine supplied and delivered more than 300,000 tonnes of metal and also supplied more than 8000 cubic metres of special grade coarse aggregate for production of hard-wearing stone mastic asphalt used on the same project. Dodd says that Wharehine Quarries’ flexible production schedules and ability to blend and create specialised products to strict quality standards within relatively short lead-in times means Wharehine is a preferred supplier for a diverse range of premium and virgin quality aggregates. The company is the largest producer of premium quality aggregate within the Rodney District. The two Rodney-based quarries produce sedimentary rock products in premium and standard grades for use in asphalt, concrete, and roading applications. Wharehine Quarries produces a number of different products: general aggregates, road aggregates, concrete aggregates, crushed fines and sands, drainage aggregates and recycled products. The company’s large Millbrook quarry at Whangaripo Valley Road is a 50/50 joint venture with Holcim NZ Ltd. Also known as Wharehine’s Whangaripo Quarry, the Millbrook Quarry site has been part of the Wharehine Group since 1955.

Wharehine’s Millbrook quarry at Whangaripo Valley Road is a 50-50 joint-venture with Holcim NZ. The quarry covers more than 240 hectares and has the potential to be quarried for many centuries to come. Aggregate from the quarry is popular as a concrete chip destined for use in tunnels and bridges, roading projects and diverse concrete structures, driveways, apartment towers, local school playgrounds to the lining of the Johnstone’s Hill Tunnels. The company’s Matakana quarry has been producing aggregates and other quarry products under Wharehine ownership since 1979. The quarry covers more than 24 hectares of land and produces aggregate for the North Auckland Region and beyond. Known for its premium quality roading aggregate the quarry was the source of metal used on the Northern Gateway

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Toll Road. From 2001 onwards due to an increase in demand for products additional crushing plant was put in both of the company’s quarries and consents extended. Dodd says that quality control is a key focus of the business. “Our quarries operate under the highest standards and are qualified to supply all industry specified asphalt, concrete and roading aggregates. The products are continually monitored for top quality by professional, certified quarry managers and laboratory technicians. The products are also routinely tested by accredited laboratories.” He says that Wharehine has been in the construction industry since 1955 because it has built a reputation, on principles of honesty, hard work, reliability and fairness.

“We have contributed to many iconic projects throughout the Auckland/ Northland region for multiple clients including the New Zealand Transport Agency, Rodney, Kaipara, Whangarei, Waitakere, and North Shore District Councils, Ministry of Education, OnTrack (New Zealand Railways) and many other large and small private sector companies. “Honesty and fairness to customers, staff, and the community aligned with securing essential primary resources and production is the key success of the Wharehine Group. “Without any doubt, it is the company’s connection to the north and its communities, along with the unique team of people and genuine enthusiasm that has allowed the company to evolve with the times.”


Quarrying » Horokiwi Quarries

New mobile screener cuts costs Adding a new mobile screening option has improved efficiency and reduced cartage costs at Horokiwi Quarries in Wellington. The company’s purchase of a new Metso ST272 mobile screening plant from Mimico has reduced double handling of waste material. The Metso two screen process produces three products: 600mm down to 110mm for the primary plant and some for sale as decorative rock, 110mm down to 65mm rock for sale or further processing, and 65mm-down to go to waste. Quarry foreman Gary Clouston says by adding the mobile screen, the company needs one less dumptruck carting waste. “Before the ST272 arrived, we were carting rock 700 metres from the new block down to the primary plant, then carting the 65-down material we don’t want back up the hill to the waste area. “The new block is producing a lot of fines, so there was a lot of double handling. The trip from the primary plant up to the waste area is a 15-20 minute round trip. By screening out the 65-down material near the new face and taking it straight to the waste area, we can take one truck off the job. ” Because there is no room to screen at the face, the Metso mobile screening plant is positioned 250 metres away, and 2000-3000 tonnes of rock is stockpiled there for a single operator to ‘walk through’ with a 45-tonne excavator and the Metso screen. The company trialled two screening plants for the job, and settled on the Metso. Clouston says it was the right size for the job, it had superior ground clearance for working on

The Metso ST272 mobile screening plant has reduced double handling of waste material. uneven ground, and the product belts were a lot higher, which allowed bigger stockpiles and more room for loaders to work. Mimico was also prepared to rent the machine to Horokiwi for a month, then take the rental cost off the purchase price. “That made the difference, because we were able to make sure the machine would do everything we wanted before we decided to purchase.

“Mimico’s service staff made some adjustments to the plant to suit the material we are working with. Now the plant is pretty well set up the way we want it,” says Clouston. The plant is processing 250-300 tonne an hour, but he says the operator can’t feed the plant flat out because the new rock is not as clean as other material at the quarry. A 45-tonne excavator has been feeding the

ST272 but Clouston says a 35 tonner would probably be a perfect match for the brown rock being handled. Horokiwi is one of Wellington’s two biggest quarries, producing a full range of roading and concrete chip, basecourse, sand, plus landscaping and decorative materials. The greywacke quarry has three fixed processing plants – primary, sand and basecourse.

Summer 2012 » Mining NZ 27


Industry News »

Briquette plant plans on track Peter Owens Despite its recent woes, Solid Energy says its new $29 million pilot lignite briquetting plant south of Mataura is project should be operational before the end of the year. The pilot plant is being constructed at the old Solid Energy lignite mine south of the town. Solid Energy’s general manager of lignite conversion, Greg Visser, says the commissioning activities were progressing well at the plant. “As is the case with commissioning of all new technologies, there is a learning process through commissioning and where required modifications are made. “It is our expectation that the project team will work through the current commissioning process through October and November with product available before the end of the year.” Visser says the structural installation of the main process tower is finished and solid Energy aims to have all installation of major coal processing equipment completed this month. The briquetter and compactor are in place, and the dryer installed on its pedestal, is connected. Utility systems and coal conveyors have been installed and the boiler system is also ready for use and the complex and highly sophisticated electrical systems have been completed. The plant on Craig Rd, using technology developed by GTL Energy, is expected to produce up to 90,000 tonnes of low-moisture, high-energy briquettes a year from about 150,000 tonnes of lignite mined from Solid Energy’s New Vale opencast mine at Waimumu.

GTL Energy, while it has an Australian base, operates mainly out of Colorado in the United States. The company specialises in processes to upgrade the economic value of low-grade coals such as lignite. It conducts a number of such operations worldwide. The company says its process is a robust, economic pre-combustion technology for production of customised high grade fuels for cleaner, more efficient power generation and gasification. GTL Energy has formed a subsidiary company in Australia for the joint venture, GTL Energy (New Zealand) Limited. It is a wholly owned subsidiary of GTL Energy Ltd, an unlisted company headquartered in Adelaide, South Australia. GTL Energy has recently completed a coal beneficiation plant in North Dakota. The briquette plant is the first of several projects planned by Solid Energy for lignite from the Waimumu, Croydon and Mataura areas. Solid Energy has forecast that while the company could covert up to 10,000 tonnes of lignite in its first year of operation, this could be expanded to a conversion of one million tonnes of lignite for anticipated export markets. The other plant Solid Energy has also announced as being built relates to a facility for the conversion of lignite-biomass into crude oil and urea. Lignite deposits are found over large areas of South Otago and Eastern Southland. At present Solid Energy estimates that it owns about three billion tonnes of lignite in Eastern Southland.

SGS expands NZ operations Since securing a contract with OceanaGold a year ago, minerals and mining expert SGS has doubled the size of its New Zealand operation and at the same time invested in the future by building a new commercial facility in Westport. The Westport facility is the flagship among SGS’s six laboratories around the country providing independent analysis and monitoring services for the mining and minerals industry. Taking on an additional 50 staff during the last 12 months, SGS now employs 120 people in its minerals division working in partnership with well established industry leaders and more recent newcomers on the New Zealand mining scene. For other long-term partners such as Solid Energy and Newmont Waihi Gold, SGS laboratories provide accurate and timely analysis and reporting for mining operations in locations across the South and North Islands, among them Ngakawau, Macraes Flat, Reefton, Runanga and Waihi. Solid Energy has partnered with SGS since 1995 to provide quality control information on all aspects of their mining operations from exploration

through to the final pre-shipment stockpile analysis. SGS also provides independent environmental sampling and analysis to ensure compliance with regulatory and internal environmental requirements. A new state of the art XRF spectrometer and upgraded Laboratory Information Management Systems (LIMS) demonstrate the commitment SGS has to keeping its leadership position in New Zealand, says SGS New Zealand Minerals Service business manager, Hugh McMillan, “Being able to provide independent, accurate and timely information and analysis is vital to help our industry partners be competitive.” “SGS is at the forefront of minerals testing and analysis in New Zealand, as we are all around the world. We constantly strive to have the best people, the best tools and the best processes”. SGS has more than 1300 laboratories and around 70,000 employees throughout the world. “We can tap into a worldwide network of expertise and we do have the benefit of being able to work closely with our minerals teams in Australia and even North America”.

L&M also eyeing liginite While there has been considerable interest in Solid Energy’s plans to convert lignite into diesel downstream from its Mataura briquetting plant, this is not the only such operation being considered in the far South. L&M Lignite Ashers-Waituna, a subsidiary of the L&M Group has also been looking at a similar project. At present another L&M subsidiary, L&M Energy has been heavily involved in prolonged coalseam gas exploration and development in Western Southland and Kaitangata in South Otago.

L&M Lignite Ashers-Waituna’s permit to explore and develop likely lignite deposits in the area north of the Waituna Lagoon expired in January this year but the company has applied for an extension. The company has done research on the Waituna area along with a small area of Crown land on the Hawkdun Range in Central Otago. A 2005 report revealed pre-exploratory examination had indicated about 900m tonnes of lignite could be mined from Ashers-Waituna and about 770m tonnes from Hawkdun.

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Global reach brings opportunity One of the impacts of the global recession on Golder Associates’ New Zealand based mining group has been to open up more off-shore opportunities, says Al Tattersall, Golder’s mining team leader and associate. “In New Zealand and across the globe, mining companies are pausing to re-assess their business plans. With our global reach, as one of 180 offices worldwide, we are as busy as ever doing feasibility and due diligence work for a number of large scale international mining developments. “We’re well placed to offer value service internationally, with world class expertise and at New Zealand prices, which are lower than many of our competitors internationally.” Golder is a global consultancy company focused on earth, environment and energy projects. It was established in New Zealand in 2001 and now has branches in Auckland, Tauranga, Hamilton, Christchurch, Dunedin and Nelson, where most of its mining group has been based since 2005. Tattersall says some of the mining group’s current international projects include both open pit and underground coal and gold projects in Australia, Mozambique, Indonesia, Philippines and South America. “For some of these projects we are in the driver’s seat while for others we are providing assistance to other Golder offices, particularly in the US, Canada, Australia and Indonesia.” Tattersall says he can’t be “too specific” about the international clients the New Zealand team is working with given the commercial sensitivity of their early stage projects. “What I can say is that our current work ranges from medium to very large scale new and established projects with multi-national mining companies. “As well, we’re providing critical technical mining know-how to investors from other sectors who are making strategic moves into the mining sector at a time when the general slow-down

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has resulted in some very interesting investment opportunities.” Tattersall says Golder offers a comprehensive suite of integrated consulting, design and construction solutions, assisting clients to meet mining challenges “head on.” “We provide full-service mining consultancy from project inception right through to mine closure, covering exploration, geological resource modeling, mine engineering, resource and reserve reporting, plus mining related cultural and environmental disciplines.” On the environmental side, Golder’s specialist services span hydrogeology, geochemistry and water management, environmental baseline studies and environmental management systems (EMS), plus full support through the consenting processes and preparation and implementation of closure and rehabilitation plans. “Our growing team of mine engineers, geologists, rock mechanics and hydro-geologists provide world class technical and service delivery.” With study work into large scale mining developments continuing around the world, Tattersall says Golder’s global focus is one of its biggest advantages. “We have an in-house global network of expertise at our fingertips, which really strengthens our business. It allows us to either keep up with or lead the rest of the world, which can only be good news for our New Zealand clients when they are ready to advance their projects.” He says Golder’s global approach also extends to national projects outside the mining sector. “We have a large geotechnical group separate from the mining group. We’re engaged in unique geotechnical engineering projects in Christchurch, as critical recovery work and planning proceeds. “In that work also we draw in expertise from across the globe, and this helps tremendously to complement and reinforce the skills and experience we’ve already built in our New Zealand staff.”

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Summer 2012 » Mining NZ 29


Industry News » MINExpo 2012

Huge machines draw huge crowds Jo Bailey MINExpo, the world’s largest trade show dedicated to the mining industry, set new records when it was held at the Las Vegas Convention Center in September. More than 50,000 attendees viewed the largest single assembly of mining equipment and technology in history, held in 12 halls over an incredible 850,000 square feet of exhibit space, up 42 percent from its previous high in 2008. The event, held every four years, is attended by many of the leading executives and professionals in the world mining industry. Among the New Zealand visitors to this year’s MINExpo were Paul Laird, mining product manager of CablePrice “Three days was barely long enough to take in the all the sights,” says Laird. “The sheer scale of it was incredible.” Laird took three CablePrice customers with him on the week-long trip to the United States, five days of which were spent in Las Vegas. The main purpose of their trip was to visit the Hitachi stand to see the new innovations and stateof-the-art technology the brand is launching to the market. “Hitachi had an amazing stand. It was great for our customers to get up close to the massive EX5600-6 560-tonne excavator that was released last year. “Other highlights included the new Hitachi EH 5000 AC3 haul trucks with sky angle cameras that give the driver a bird’s eye view right around the truck and the ability to detect objects within a metre radius of its outside perimeter.” The visitors also spent some time at Scania’s stand viewing its new specialized haul truck. “It was great to see that up close with our customers and talk about its applications in New Zealand.”

Getting up close to the massive Hitachi EX5600-6 excavator. Laird says it is impossible to single out one highlight from the rest of the show, as it was all “spectacular”. “It was great to have the opportunity to view

literally hundreds of products on a level playing field. There were heaps of innovative new products we think will make it to the New Zealand market.” “It was a very well run event, with good

transport options and on-site facilities. “I’ve had nothing but positive feedback from our customers, who like me where blown away by its scale.”

Caterpillar stand impresses GoughCat national mining manager Aaron Smith says visiting Caterpillar’s record-breaking stand was a highlight of MINExpo. “Caterpillar had the largest booth in the show’s history, with an extraordinary 52,000 square feet showcasing its complete range of mining and support equipment, technologies, engines, Cat dealer services and more.” He says Caterpillar’s multi-billion dollar acquisition of Bucyrus just over a year ago “set the platform” for its MINExpo appearance. “It was a great opportunity for Caterpillar to showcase the broadest product line in the mining industry.” Smith hosted Bernie O’Leary and Cliff Webb from OceanaGold and Barry Sarginson from Stevenson’s Mining on the two week trip. Smith, Webb and Sarginson spent the first week visiting several Caterpillar facilities, including Peoria which is Caterpillar’s global headquarters. “One of the things Caterpillar did particularly well was to split its exhibit into two areas – the surface

Caterpillar had an enormous presence at MINExpo.

area featured products for hauling, materials handling and extraction and the underground area featured equipment for hard rock, longwall and room and pillar applications.” A feature of the Caterpillar stand was a 20-foot long display with three 65-inch interactive touch screens, bringing the Cat Global Mining tag-line “Wherever there’s mining” to life through stories, videos, photos and more.” Caterpillar also had real focus on “technology” which included the Cat MineStar System walkway and operations centre on the above-ground side of the exhibit, and an underground operations centre on the below-ground side. Smith says they also had a “good look around” the rest of the expo and enjoyed the opportunity to rekindle old networks and meet new people in similar roles from all over the world. “One of the most valuable things about the trip was the opportunity to spend time with our customers and get to know them on a different level.”

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