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Over the past several years, copper prices have surged from under a dollar to over three dollars a pound. However, the long-run trend in real copper prices since at least the early 1970s has been sharply downward. While many now contend that the long-run trend in real copper prices is now upward, the result of structural changes in this market, others are sceptical. Nor is copper unique; the prices for a number of other metals, including aluminium, iron ore, lead, nickel and zinc, have followed similar patterns. This paper examines the forces behind short-run and long-run trends in metal prices. It first focuses on the short run, where it argues that shifts in demand are largely behind changes in prices. It then turns to the long run, where it concludes that production costs and supply largely govern price trends. Finally, it explores several implications of these findings, including those for diversification and market risk, for forecasting mineral prices, for assessing the growth of metal demand in China and elsewhere on metal prices, and for changes in the long-run price trends.

Jan 1, 2006

By M L. van Kampen

The recent (2005) amendments to the Resource Management Act 1991 have made it clear that there is no obligation on an applicant to consult. However the importance and value in consulting with the community, particularly before commencing a major project, cannot be understated.   This paper looks at the provisions of the Resource Management Act as they relate to consultation and public participation in the process, and will discuss the benefits of consultation both before an application is filed and following the filing of the application. Engaging with the local community can help shape a project to better fit the community, engender support and address opposition. In short, taking the extra step to what is legally required, can help smooth what is potentially a bumpy road. Examples in practice of the value of consultation are given.

Jan 1, 2006

The main asset of a mining company is the mineral resource; without resources there is no mining business and the infrastructure is useless. In this context the role of the mining geologist is to always keep the resource inventory to an optimum level for the mining business and to maximise the transformation of the resources into reserves in a multi- disciplinary work environment. In short, a ægood mining geologist has to always provide the best ore to the millÆ.To do his/her work properly, several technical skills are needed: to know how to observe and describe nature in order to optimise the data acquisition process, particularly when mapping; to have a good understanding of natural variability in order to develop proper sampling strategies and sample preparation protocols to minimise all the errors generated by the sampling process; to have a good understanding of assaying practices: their limitations as well as their assaying errors; to carefully and properly store the geological data and information and to preserve the geological patrimony; to fully understand ore forming processes to generate the best possible geoscientific models, which are fundamental for the mining business; to fully understand the consequences of the geoscientific models along the value chain from rock to cathodes; and to continuously validate and improve geological practices and models by continuous data collection and observation of geo- mining-metallurgy processes. Some very important behavioural competencies are also needed:long-term vision, passion for excellence and value generation, strategic influence, systemic and innovative thinking, and knowledge and experience transfer. Last but not least, it is important to point out that a deep knowledge of the mining business is essential to add value by using geology best practices.

Jan 1, 2006

By C J. Moran

The Gladstone region, as one of the most industrially intense regions in Australia, uses significant quantities of fresh water. Awoonga Dam, situated on the Boyne River, is the only major source of water in the region. The current typical annual usage is 53 GL (Porteous, 2006) and approximately 80 per cent of the water is used by heavy industry (Gladstone Area Water Board, 2004). Until relatively recently, there has been ready and easy access to raw water for industrial use. The recent drought, which resulted in severe water restrictions in 2002 and 2003, emphasised the importance of water for a dominant industrial region like Gladstone. Although now in the process of changing, the typical contractual arrangements in the past have provided little financial incentive for efficient water use. From research undertaken on potential water reuse opportunities, several key questions have emerged related to water management in an industrial region such as Gladstone. This paper highlights these key questions, presents findings from recent regional strategies and assesses the potential for water reuse. Even though there is no clear-cut financial incentive for reusing water, there could be stronger regional and risk mitigation drivers for doing so. Initiatives to incorporate adaptive capacity through collaborative industrial synergies would allow for robustness and resilience in water security, leading to long-term sustainable water management across the Gladstone region.

Jan 1, 2006

By P Davidson

For many years, in numerous settings, the need for a language-fair and culture-fair assessment test has been identified as a significant issue for employment and selection for training of remote indigenous community members. Pivotal to the successful implementation and application of such a test is for it to gain the acceptance and trust of the local indigenous communities as a fair assessment and for it to provide organisations with an accurate predictive tool. However, when western tests have been used with indigenous groups, inherent language and cultural bias have had a significant negative impact in terms of community acceptance. These have also affected the accuracy of performance predictability. The Queensland Test was developed to overcome these problems. Originally developed for use in Papua New Guinea, it reduced training failures by 20 per cent. Later refinements were made and it was used with Aboriginal Australians. Since 2002, assessment tests have been used by the Freeport mine in West Papua to support their recruitment, selection and training processes for the local indigenous community, the Seven Suku Tribes. The initial process included the application of standard æwesternÆ assessment tests, which did not provide valid selection predictions, with community members and elders describing these tests as unfair and the organisation being concerned that the results were not accurate. A trial of the Queensland Test was conducted and a high correlation was established between the performance of FreeportÆs current Seven Suku employees as assessed by their managers and their Queensland Test results. Based on the results of this pilot the Queensland Test was successfully implemented as the primary selection tool for potential employees from these local indigenous groups. The testing materials and method gained community trust and support, with tribal elders describing the Queensland Test as a fair and suitable selection tool for their community members. Such results have sparked an interest within the Australian Mining industry, with similar results being reported from a recent trial. The Queensland Test has been implemented at a major site in Queensland and is being investigated for use elsewhere.

Jan 1, 2006

By F Jullian, L Jofre

Many maintenance managers find it difficult to justify investments in maintenance improvement initiatives. In part, this is due to a tendency by mine managers to regard maintenance purely as a cost centre, and not as a process able to influence productive capacity and profit. It is also hindered by a lack of alignment between commonly used maintenance performance measures and key business drivers, and the lack of formal business training amongst maintenance professionals. With this in mind, a model to assist maintenance managers in evaluating the benefits of maintenance improvement projects was recently formulated. The model considers four cost saving dimensions. These are: 1. reduction in the cost of unplanned repairs and maintenance,2. increased or accelerated production and/or sales,3. spares inventory reduction, and4. reduction in over-investment in physical assets and operating costs. This paper discusses the application of this model and a number of numerical examples are given to justify investments in maintenance improvement projects having varying objectives.

Jan 1, 2006

By M Wortley, J McKay, D La Rosa, O Guyo

It has been a generally held concept that crushing operations were, by their nature, too simple to benefit from the implementation of advanced process control. The commissioning of an OCS¬ expert control system and image-based oversize detection system, VisioRock, at the Pilbara Iron Tom Price facility are dispelling these notions. A constraint-based OCS¬ expert control system has been designed and commissioned on the high-grade crushing and screening plant along with a vision-based oversize detection system functioning on six product conveyor belts. To date, the expert control has demonstrated the ability to increase production by maximising dynamic constraint utilisation. Dynamic constraint utilisation is a concept developed by Rio Tinto Technical Services for effectively evaluating constraint-based control logic performance. The VisioRock system has been installed and configured and has been operating for a period of several months. Currently, Tom Price and Metso personnel are working to define correct oversize detection thresholds. Details of the plant implementation are discussed.

Jan 1, 2006

By T Muri

The drying operation of materials from particulate solids, through slurries and suspensions, to continuous sheets represents an important part of several processes in the chemical and mineral industries. The increasing demand of high productivity at low cost and minimal environmental impact makes it complex to evaluate and choose the best available drying technology for each industrial application. The drying technologies are mainly characterised on the basis of how the wet product is related to the drying medium, namely: direct and indirect drying. In the direct drying method (convection drying), the product is brought into direct contact with the drying medium, which may be hot gas or air. Large quantities of gas are necessary for transfer of the required energy. A special case of the direct dryer is the fluid bed dryer, in which the product floats on a cushion of air or gas. The process air is supplied to the bed through a perforated distributor plate and flows through the bed of solids at a velocity sufficient to support the weight of particles. Very high heat and mass transfer values are obtained as a result of the intimate contact with the solids and the relative velocities between individual particles and the fluidising gas. In the indirect drying method (conduction or contact drying), the wet product is separated from the drying medium. The drying unit can consist of a rotor forming the indirect contact heating surface mounted in a stationary or rotating shell. The indirect method uses saturated or superheated steam resulting in low energy consumption and minimal environmental impact. In this paper, a review is given of the technologies available on the market based on different drying methods. The advantages and the disadvantages are summarised with respect to issues such as investment and operating cost, maintenance, product capacity, product handling and environmental impact.

Jan 1, 2006

By S R. Grano

The selection of the proper frother, specifically for a given ore, is essential in flotation. Traditionally, strong and stable froths are required in the scavengers, where metal recovery needs to be maximised, while selectivity must be achieved in the roughers and cleaners, where grade of concentrates is the main issue. The physical properties of a froth are determined both by frother type, by process water composition and by the amount and nature of the suspended particles. The evaluation of different frothers, in terms of metallurgical performance, is complicated at plant scale, since it may lead to periods of malfunctioning of the process and unacceptable decreases in recovery. On the other hand, evaluation based on frother chemistry only, is often unsatisfactory, because the frothing response is strongly ore dependent. A procedure, and proper tools, was developed at the Wark in order to perform the screening of candidate frothers at batch scale on real pulp samples. The main parameters related to froth stability (half-life time, froth height) are measured after introducing the pulp samples into a foaming column, where different conditions in terms of frother addition, agitation and aeration can be maintained. The approach has been applied to the selection of frothers for the flotation of an Australian sulfide ore. Procedure and results are discussed.

Jan 1, 2006

By H. J. Glass, A J. Cornah

Improving the quality of the variogram helps to improve subsequent estimation and simulation processes. Two strategies for conditioning data prior to construction of the variogram are investigated using data from the Luce iron ore deposit in Canada. One strategy is the classic approach in which the deposit is subdivided into a set of structural domains. The domains are analysed individually and datapairs are recombined to produce a variogram. The second strategy is reconstruction of the deposit at an earlier stage of its history through unfolding. This involves transformation of the Cartesian coordinates into stratigraphic coordinate system. Improvement in the variogram quality, expressed in a decreased weighted deviation from a fitted model, is observed for both types of data conditioning. This indicates that, for the Luce deposit, application of data conditioning could also help to inform the selection of sampling locations.

Jan 1, 2006

By K J. Davey, J T. Woodcock

Australian steelmakers produce up to 30 000 t/yr of electric arc furnace (EAF) dust. Current disposal techniques include sending EAF dust to landfill, stockpiling, and paying zinc smelters or registered waste removalists/processors to take the dust. Many of the complex overseas pyrometallurgical and hydrometallurgical treatment routes cited in the literature are not considered economic. Governmental, environmental and social pressures on producers to consider more sustainable disposal options are mounting, and there is now a strong push to consider recovering potentially valuable or recyclable components, such as zinc and iron units, from EAF dust. As well, there remain strong economic drivers for producers to find lower cost disposal solutions. Characterisation studies undertaken at CSIRO Minerals have revealed important physical differences in the nature of the zinc- and iron-bearing phases contained in domestic EAF dusts. These differences have been exploited using simple and cheap mineral processing techniques such as water washing, wet cycloning and wet magnetic separation. This has allowed a significant upgrade in the zinc content of EAF dust to be achieved, together with a reduction in the levels of key smelter penalty elements, such as chlorides and fluorides. The zinc-rich portion of the dust is now a more attractive smelter feed while the iron-rich part of the dust could potentially be briquetted or pelletised with a reductant and recycled to recover iron, and thus close the loop on dust processing. The basis of the separations tested together with laboratory results from several Australian dust samples are presented and discussed in this paper.

Jan 1, 2006

By N Weatherstone

A consistent and reliable international approach to public reporting of a mining companyÆs main assets, its Mineral Resources and Mineral Reserves, has become of increasing importance in recent years with the rapid globalisation of the mining industry. Through the efforts of the Committee for Mineral Reserves International Reporting Standards (CRIRSCO), a committee representing national resource/reserve reporting committees in Australia, South Africa, UK/Ireland/Western Europe, Canada, USA and Chile, the reporting standards in most æwesternÆ countries use almost identical resource and reserve definitions and are generally around 90 - 95 per cent compatible. New codes based on the CRIRSCO model are being developed or considered in other countries, including Peru and the Philippines. This unified approach has provided the mining industry, regulators and investors with a common framework to report and interpret mineral resource and reserve estimates, thereby facilitating funding to the mining industry through improved investor understanding and confidence. The common reporting standards are reflected in the CRIRSCO International Template, available on CRIRSCOÆs web site, a document that is kept æliveÆ by reflecting the best of the most recently published CRIRSCO-type national standards. In a significant exception to this unified industry approach, the USA Securities and Exchange Commission (SEC) requires adherence to its own standard, only partly compatible with CRIRSCO-type standards, with adverse and costly implications for companies listed in the USA. A major industry submission was presented to SEC in April 2005 which, if accepted, would bring about considerable compatibility of CRIRSCO and SEC standards. The UN Economic Commission for Europe (UN-ECE) has, since 1992, been developing its Framework Classification (UNFC) as a single global system for harmonising all existing national and international resource/reserve reporting systems, covering both government and industry requirements and both the hydrocarbon and solid minerals sectors. While few mining companies report their resources and reserves using the UNFC, the system is accepted or is being examined as a basis for reporting by some governments, including those of Russia, China and India. The UN-ECE agreed in 1999 to incorporate CRIRSCO definitions into the UNFC for those categories of resources and reserves used for market-related reporting, but a more recent edition of the UNFC removed or changed the definitions, requiring re-engagement by CRIRSCO to ensure compatibility. Since 2005, CRIRSCO and the Society of Petroleum Engineers (SPE) have been involved in discussions with the International Accounting Standards Board (IASB), which plans to develop a new Accounting Standard for the Extractive Industries as part of its International Financial Reporting Standards. At the request of the IASB, CRIRSCO and SPE have been examining any potential for convergence of resource/reserve definitions between the mining and hydrocarbon industries. Each of these systems is described in this paper and high level comparisons made.

Jan 1, 2006

By O Dahl, I M. Platten, E J. Sides

Many narrow-vein gold deposits are characterised by a high to extreme nugget effect and the presence of coarse gold. They rank amongst the most difficult of deposits to produce an accurate and precise resource estimate. This contribution presents a case study from the Nalunaq Gold Mine in Southern Greenland. The mine commenced operation in May 2004 and is currently operating at a rate of 400 tonnes per day, to produce about 100 000 oz gold per annum from a total resource base of 1.2 Moz. Mineralisation is characterised by quartz veins that are hosted within a shear zone that is continuous over about 1000 m. The principal orebody is the Main Vein structure, which ranges up to 3 m in width, maintains an average dip of 35¦SE, and contains significant gold grades (1000s g/t Au). Gold particles are often visible, with 25 per cent being greater than 250 microns in size. Variography using underground development samples indicates a nugget effect of about 75 per cent. For the 2005 resource estimate, a 2D metal accumulation ordinary kriged block model was used to produce a global grade for the Target and South Blocks of the Main Vein. Grade control chip-channel samples are collected from æshantyÆ drive footwalls, and used as the basis for both the kriged block model and to determine the grade of individual stope blocks by peripheral weighted averages. Geology plays a key role in mining efficiency, given the locally variable nature of the ore zone.

Jan 1, 2006

By J de Vries

Arthur Page, a past President of AT&T said:All businesses in a democratic society begin with public permission, and exist by public approval. Product stewardship in its most basic form is simply risk management applied to the products we produce. Conceptually it may be considered as a more expansive approach to many existing safety, heath and environmental programs. Key differences include the extension of responsibility beyond the direct control of management, and consideration of the implications your products and processes have on the broader community, as opposed to the confines of an individual mine site or operation. This paper reviews the processes used by Orica Ltd to manage its product stewardship program. OricaÆs product stewardship program is expansive and supports activities and business that range from manufacture and delivery of commercial explosives and sodium cyanide to mines throughout the world, supply and operation of municipal water facilities, and manufacture and distribution of consumer products such as household paints and adhesives. We highlight the development of the program through experience both good and bad, and by use of case studies to illustrate how an active product stewardship program is an effective business risk mitigation strategy.

Jan 1, 2006

By B Hall

The authors have undertaken many independent mine optimisation and operational improvement projects at Australian and international mining operations over the past decade. This work has provided an understanding of the underlying practices responsible for the good long-term performance of some operations, and the failure of others to achieve their objectives. Good long-term performance, and value creation can be achieved through a logical and rigorous process of identifying the optimal mine plan (æThe PlanÆ) that delivers the corporate goals, establishing appropriate performance measures that are aligned with these goals, and ongoing monitoring of compliance with the established targets to ensure the operation reliably achieves The Plan. A number of practical methods have been developed and implemented to assist mining operations deliver their corporate goals. This paper outlines some of these methods, providing some fundamental guidelines that will assist in the establishment, and reliable achievement of The Plan that delivers the corporate goals.

Jan 1, 2006

Technically competent, skilled and efficient people are often promoted into management and leadership positions, climbing through the ranks to senior positions without training or direction in soft skilling. These soft skills are what really motivate teams to achieve business goals. This paper looks at the three key soft skill areas that compel teams to follow leaders, namely manners, mentoring and motivation. Our manners control our behaviour and attitudes and operate at a subconscious level. The manners that æmaketh the manager worth followingÆ are discussed with the express purpose of bringing these to our consciousness. When we recognise those behaviours that alienate or inspire we can consciously behave in ways to lead our teams towards our goals. Our attitude to mentoring and developing people around us speaks of our commitment to our people and our industry. Surprisingly, the more we give the more we get. Mentoring gives us an opportunity to leave a legacy, inspire commitment and build support within the mining community. How do we as managers provide mentoring within our teams? What are the mentoring behaviours that inspire learning and commitment to a managerÆs goals? When managers can identify an individualÆs unique mix of motivational drivers, they can understand how to motivate them. And motivated people are more likely to be retained and work towards the managerÆs goals. The soft skills used to understand and motivate within the three core motivation drivers (competence, expression and treatment) are presented. This paper is designed to share straightforward soft skills for managers who have tread the technical route.

Jan 1, 2006

By K L. Brown

Sampling and analyses of deep waters from Wairakei and Rotokawa geothermal systems indicate a wide range of precious metal concentrations (<0.1 to 23 ppb Au; 6 to 2400 ppb Ag), suggesting that eastern ôandesiticö TVZ geothermal systems (eg Rotokawa) have higher aqueous gold and silver than western ôbasalticö geothermal systems (eg Wairakei); this interpretation is consistent with known occurrences of high grade precipitates in wells from eastern systems. The fact that the deep waters are undersaturated in gold further suggests that the aqueous gold concentrations of deep waters are limited by metal availability. The flux of gold for the two systems ranges from ~1 to 50 kg Au/yr, and the flux of silver ranges from 65 to 6900 kg Ag/yr. At Rotokawa, it only takes ~600 years to flux one million oz of Au and >100 million oz of Ag. The supply of hydrothermal gold and silver is obviously important during genesis of an epithermal deposit, but ore formation also depends on the existence of a suitable ôtrapö that efficiently extracts metal from solution in a small volume of rock. Such traps seem to have been poorly developed until geothermal drilling in the TVZ.

Jan 1, 2006

By C Hedemann, N Silveste, H Davis, C J. Moran

For nearly two decades water scientists have been debating the need to use appropriate models for the questions being asked and the data available. This paper puts forward a rationale for a hierarchical framework for water balance modelling as it applies to mine sites. The hierarchy is based on the complexity of models and their data requirements. Scientific models are the most complex and require the most data; next is engineering models, then systems models and the simplest representations are given by conceptual models. A position is put forward that systems models have a range of uses that the others do not provide. A systems model, called SiteMiser, is described and its calibration illustrated. The model is applied to seven coal mines from the Northern Bowen Basin in Central Queensland. Currently, there is little relationship between total water use and coal production. This relationship is not any stronger when fresh (raw) water is compared to reused water. Leading practice water use levels are simulated for all sites. The simulation results demonstrate that there is considerable opportunity to reduce water consumption and, in particular, to import less fresh (raw) water to the sites.

Jan 1, 2006

By R van Berkel, J Lay, D van Beers

The development of regional resource synergies in intensive areas with concentrations of minerals processing industries provides a significant avenue towards sustainable resource processing. Gladstone (Queensland) and Kwinana (Western Australia) are two of AustraliaÆs major heavy industrial areas. There are a number of successful regional synergies in both areas. In addition to the existing regional synergies in both areas, more potential synergy opportunities appear to exist which, upon implementation, could benefit industry, the environment and the community. To further enhance the development of such potential regional synergies, the Centre for Sustainable Resource Processing (http://www.csrp.com.au) commissioned research projects to facilitate the identification of potential synergies and assist with their implementation in both regions. This paper presents a selection of specific examples from both regions to illustrate the sustainability benefits from regional synergy developments. Although the composition of industries in the Gladstone and Kwinana regions is different both in terms of geography and industry diversity, similarities in synergy developments for both regions are apparent. Consequently, the examples discussed in this paper are organised around the key themes of water, energy and inorganic by-products. Comparison on a theme basis highlights success factors of successful synergies and demonstrates the range of benefits resulting from their implementation.

Jan 1, 2006

By R C. Schodde

The future of any mining company depends on maintaining and growing its access to high-quality mineral resources. Often the true size of a given resource is not fully recognised until after mining has commenced. Also, the strong desire to increase production puts pressure to expand the resource base of the mine to get maximum value out of the capital employed. This, plus diminishing M&A opportunities and declining world-class greenfield discovery rates, makes brownfields exploration a high priority activity in any operating company. For the success and long-term survival of the company it is critical that this is done well. The primary aim of brownfields exploration is to find or acquire new deposits within economic transport distance of an existing mine that will add materially to shareholder value through: mine or capacity expansion, displacement of lower-margin ore from the mine plan, preserving and extending the mine life, and ensuring potential value is understood in order to maximise potential future mine development or exit. A number of strategic principles are important in any program designed to achieve these aims: understanding the life of mine (LOM) production profile and the related key drivers for exploration, understanding the dynamic nature of the brownfields search space, understanding and measuring depletion of the brownfields search space, understanding the potential of the near-mine region, investing in exploration technology to expand the search space, and investing in a basic geological understanding of the ore-environment. Examination of the LOM profile will highlight critical issues facing development plans for the mine including future grade and throughput issues, key technology requirements or innovations and scenarios for increased production. Exploration targets in the brownfields program should address these key issues. Often it is as æsimpleÆ as keeping mine development sufficiently far ahead of extraction to allow time for the various phases of exploration and resource assessment drilling. Because of the low additional capital costs required, expansion of the brownfields search space is strongly leveraged to: metal prices, development of new markets, incremental operating cost reductions, strategic changes in downstream requirements in integrated businesses, depletion of higher unit-value ores, and new technologies (both extraction and exploration). Therefore the brownfields search space is likely to incrementally expand through time and must be regularly reviewed. This is also important as any given search space will be progressively exhausted, resulting in smaller and higher cost discoveries. It is therefore important to monitor and critically review sustained trends of increasing brownfields discovery cost. The first wave of discoveries in any camp are usually empirically driven and do not need a strong geological understanding. However, an improved geological understanding is critical to making the next generation of hidden discoveries. To illustrate these points, a case study was carried out on the exploration and development history of the Kambalda nickel camp. Over a period of 40 years, more than 40 deposits were found containing over 1.7 million tonnes of nickel metal. Efficient mines need to maintain reserves for operating flexibility. Consequently, the company needs to clearly understand the global resource in order to maximise its full potential. In addition, understanding the full brownfields potential earlier in the development of a deposit rather than later, creates optionality through the flexibility that this understanding brings to future development choices. To ensure best practice in attaining this aim, the roles and responsibilities of the exploration team and the mine operation should be clearly understood. It is important for the explorers and the operators to have shared views about what needs to be done. Typically, mine operators would be accountable for identifying future resource requirements to support the life-of-mine production schedule whilst explorers would be accountable to ensure best-practice assessment of brownfields exploration opportunities. This would include an assessment of the global undiscovered endowment in the regional near-mine area. The balance between brownfield exploration drilling and resources to reserve conversion will need to be decided to ensure efficient operations are maintained. Both need to agree the optimum level of brownfields funding taking into account: urgency to replace or grow reserves, and quality of opportunities (relative to those elsewhere). The ultimate cost of ignoring the full brownfields potential of an operating asset can be significant, ranging from inefficient and poorly planned operations, lost opportunity cost and resultant value through under-utilised resources and, in the worst case, early exit from the asset at the bottom of the commodity cycle û leaving behind huge amounts of shareholder value.

Jan 1, 2006