Volume 9 Edition 5 2012 - The ASIA Miner

September/October 2012 | Volume 9 | Issue 5 | Industry Technical Information | 矿业技术信息 

MONGOLIA TRANSFORMS 蒙古的转变 

Australian mining technology goes global • Focus on iron ore 澳大利亚采矿技术走向全球 • 聚焦铁矿石

FEATURES 

Australian technology Mining technology developed by Australian companies is ensuring that the global 

mining industry is meeting the challenges of a world that needs more and more resources but which is also 

demanding more in terms of environmental protection, safety, employment opportunities and accountability. 

Leading the charge with technology development is the Commonwealth Scientific and Industrial Research 

Organization (CSIRO) backed by government, industry groups and industry itself. This special feature looks 

at how Australian technology is changing the face of mining. ..............................................From page 74 

Electric Shovels A case study by P&H Mining Equipment compares the performance of a P&H AC-powered 

rope shovel against its DC-powered shovel with the results providing interesting reading. .............................91 

Screen Systems W.S. Tyler’s large vibrating screen handles high production demands ........................94 

LEADING DEVELOPMENTS 

Asian Intelligence With Myanmar’s economy starting to open up after years of isolation fr om the West, foreign 

investment in mining is actively being encouraged by the new democratically elected government .......6 

Mongolia Metallurgical test results have confirmed the quality of the magnetite ore at Haranga Resources’ 

Selenge Iron Ore Project and represent a substantial progression of the project....................................10 

Exploration Drilling is progressing well in the Tenge/Ruoni area of Baobab Resources’ Tete pig iron, 

vanadium and titanium project in Mozambique. ..................................................................................104 

AROUND THE REGION 

Mongolia Prophecy Coal is consolidating its holdings in Chandgana Basin of central Mongolia. .............8 

China Chinese copper demand is expected to be stronger in the second half of 2012. ........................38 

Indonesia Padang Resources is turning its full attention to the Paser Coal Project in East Kalimantan. ......49 

Philippines A Chinese company intends to purchase 600,000 tonnes of iron ore from Astra Resources. .....56 

Vietnam Asian Mineral Resources will conduct a detailed study for smelter at its Ban Phuc project. .....57 

Malaysia Lynas Corporation is focusing on the phase two expansion at its rare earths process plant........58 

South Pacific Glass Earth Gold has commissioned a second gold recovery unit at Hecklers Mine.........6 

Central Asia Copper production at Central Asia Metals’ Kounrad plant is exceeding expectations. ......62 

Australia Centrex Metals is on track to complete a DFS at its Fusion Magnetite Project by early 2013. .....64 

India NSL Consolidated has received multiple purchase orders from Indian steel producers............... 68 

Papua New Guinea The feasibility study for Marengo Mining’s Yandera project is nearing completion. ......70 

The Oyu Tolgoi Copper-Gold Project (OT) in Mongolia’s 

South Gobi is transforming the North Asian 

country into a strong mining and manufacturing 

centre sandwiched between the major markets of 

China and Russia. The project is operated by Oyu 

Tolgoi LLC, a Mongolian company owned by Rio 

Tinto, Turquoise Hill Resources (formerly Ivanhoe 

Mines) and the Mongolian Government. OT is more 

than 94% complete and initial output of concentrate 

is set to begin by the end of 2012. 

Photo Turquoise Hill Resources. 

DEPARTMENTS 

Advertisers’ Index ....................................102 

Calendar of Events ....................................72 

From the Editor ............................................2 

Product News ............................................95 

Subscription Form ....................................102 

Supplier News ............................................98 

Sharyn Gol gains approval ................................ 34 Battery grade is achieved..................................40 First gold from Martabe.................................... 52 

September/October 2012 | ASIA Miner | 1

From The Editor 

Uncertain times for mining in Mongolia 

THE very nature of the coalition government formed after Mongolia’s parliamentary 

election seems certain to result in an increase in politization, polarization, 

confrontation and divisiveness in the r esource-rich North Asian 

nation. In terms of mineral resources, the coalition will be under substantial 

pressure to be more populist with policies and, therefore, resource nationalism 

will be a greater risk, investors will be a lot less willing to part with funds 

to support Mongolian mining pr ojects and there will be elevated levels of 

volatility for the country’s resource equities. The impending election created 

much uncertainty in the first half of 2012 and ther e has been little change 

By John Miller /Editor 

since the late June election. This has not been beneficial to the nation’ s mining 

industry, which has also not been aided by a period of global economic softening and reduced 

demand for Mongolia’s main resource, coal, from its biggest customer, China. 

Pre-election murmurs of reviewing the investment agreement for the Oyu Tolgoi Copper-Gold 

Project of Rio Tinto and Turquoise Hill Resources (formerly Ivanhoe) have intensified as has the 

possibility of the 7.5 billion tonne Tavan Tolgoi (TT) Coal Project remaining entirely in Mongolian 

hands. Few major Mongolian projects are progressing smoothly with Aluminum Corp of China 

Ltd’s (Chalco) attempted takeover of SouthGobi Resour ces a prime example. The announcement 

earlier this year prompted Parliament to pass legislation capping foreign investment purchases 

to below 50% unless gover nment approval is attained. Mongolia has also dragged its 

feet over renewing some of SouthGobi’s licences, scaring away customers, squashing production 

and causing SouthGobi’s share price to plummet. 

This uncertainty is being exacerbated by continuing problems with issuing new exploration licences 

and renewals while there is also considerable ambiguity surrounding the term ‘strategic 

importance’ in relation to certain mineral deposits. 

Regarding the Oyu Tolgoi agreement, private Mongolian investment company Frontier Securities 

states that 12 MPs from the original 20 who signed a petition this year seeking to r evise 

the agreement were elected to the new Parliament, and as such the pr obability of a revival of 

this call cannot be ruled out. Regarding TT, Frontier says that with new Prime Minister Norov Altanhuyag’s 

extensive experience in the project, it believes TT will advance, broadly speaking, as 

planned and that new Government will aim to make it a success. However, again due to populist 

and resource nationalist pressures, Frontier believes that there is likelihood of some concessions 

of certain degree in one way or another to these pressures. 

These issues need to be resolved if Mongolians are to receive full benefits of the country’s mineral 

wealth and the coalition’s major player, the Mongolian Democratic Party, is well placed to do that as 

indicated by the level-headed and generally fair mining sector policies outlined in its pre-election platform. 

Its overall policies are characterized by low taxes and support of production and industry with 

the goal of establishing a comfortable middle class and an emphasis on cr eating jobs and income 

for Mongolians, universal residential programs, paying attention to their health, education, safe environment, 

freedom and liberties. At the same time, policies popular with voters such as incr eases 

in salaries and pensions are likely to continue as well as much needed targeted social programs. 

It will have to ensure it works closely with the other coalition partners and ther e will be mistakes 

made while walking this tightr ope, but such is the str ength and potential of Mongolia’s 

mining sector that the country’s economy is still certain to be led in an upward direction by the 

industry for years to come. It will not be an easy task for the new Prime Minister whose coalition’s 

priority is sustainable development of Mongolia’s tiny but fast-growing economy while also 

trying to please its impatient citizens as well as its two giant neighbours Russia and China. 

Since essentially voters have empowered the new Parliament with a strong resource nationalist 

mandate, the coalition is likely to stick to the pre-election stance of complying with the law 

on regulation of foreign investment into enterprises of strategic significance but it is of utmost 

importance that the new government also sends the right signals to foreign investors. 

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2 | ASIA Miner | September/October 2012

Asian Intelligence 

Top iron-ore miner still confident in China 

VALE, the world’s number two mining company 

by market capitalization and the world’s 

number one iron-ore producer, remains confident 

that the Chinese economy will continue 

to expand strongly, despite recent deceleration 

of the growth rate to 7.6% in the second 

quarter of this year. Between 1999 and 2009, 

China’s economy grew at an annual average 

real rate of 10.3%, while between 1989 and 

1999 the equivalent figure was 9.9%. 

Vale executive director iron-ore and strategy 

José Carlos Martins told Brazilian media 

recently. “China is going through a process of 

structural change, which will mean a r eduction 

in the rate of investment and an increase 

in consumption. The exter nal sector is also 

Iron ore miner Vale expects China to continue to play the leading role in determining to strength of the global iron ore industry. 

reducing its dynamism but the economy will 

still grow between 7% and 8% this year , a 

number that is still enviable.” In coming years, 

he expects the use of steel to manufactur e 

vehicles, whitegoods and homes in China to 

increase while the use in infrastructure, capital 

equipment, other machinery and equipment 

and export products will decline. 

Vale expects Chinese iron-ore demand to 

rise by 5% this year. Iron-ore prices have fallen 

from about $170/tonne in 2011 to around 

$140/tonne this year, but Vale says this is the 

result of increasing competition in the market, 

not a fall in demand. José Carlos Martins 

says the company's shipments to China continue 

to grow. “We do not have problems placing 

our volumes in China. It is a question of 

availability, competitiveness, quality and price. 

“The price will remain volatile, in a band of 

$120 to $180 delivered to China, but probably 

below $150 in the next few months. The 

Western economy is in recession and China 

is passing through a structural adjustment. 

We are no longer going to see the exuberance 

of the past few years, however, we see 

very healthy growth.” 

For the past decade, ir on-ore prices have 

been driven by a demand growth that continually 

outstripped supply but in the next few 

years new mines will enter operation and, 

with a reduced rate of growth in demand, the 

price will be more influenced by the supply. 

Vale is not concerned about its level of dependence 

on China. “Companies sell where 

there is a market and the market is China. 

Vale is less dependent on China than our direct 

competitors as we also sell in Brazil, 

the Americas, Eur ope, the Middle East, 

Japan, Korea, as well as in China. What 

many see as a problem, we see as a solution. 

If we wanted to r educe our dependence 

on China, we would have to r educe 

production, because the other markets 

don’t have the capacity to absorb this volume,” 

José Carlos Martins adds. 

China’s building bolsters zinc market 

ASIA-PACIFIC is the largest zinc producing region 

in the world, and upcoming zinc mining 

projects in Australia, China and India are set to 

push production even higher, states a report 

by mining experts GBI Research. ‘Zinc Mining 

Market in Asia-Pacific to 2020’ states that demand 

from galvanized steel makers is rising in 

the region, as populations expand and housing 

projects are announced, keeping investor interest 

alive and the zinc industry buoyant. 

Substantial reserves in China, Australia and 

Kazakhstan support Asia’s zinc mining industry. 

According to the US Geological Survey, 

Asia-Pacific had the largest zinc r eserves in 

the world at the end of 2010 with 122 million 

tonnes, with Australia and China accounting 

for around 78%. Most zinc r eserves in Australia 

are in Queensland, New South Wales, 

Western Australia and V ictoria, while Hubei 

and Guangdong Sheng provinces accounted 

for the majority of reserves in China. 

Planned and upcoming zinc pr ojects in 

Australia, China and India will incr ease the 

region’s production levels in the next few 

years. This anticipated boost in activity is 

driven by a surging demand for galvanized 

steel used in construction. China’s domestic 

consumption is expected to incr ease from 

around 5.229 million tonnes in 2010 to 

roughly 6.506 million tonnes by 2020, due 

to its plan to build 36 million units of affordable 

housing by 2015. 

Overall zinc metal consumption in the Asia- 

Pacific stood at an estimated 6.4 million tonnes 

in 2011, with China accounting for 

almost 90% of this. Regional consumption 

this decade is expected to gr ow at a compound 

annual growth rate (CAGR) of around 

1.6% to reach about 7.8 million tonnes by 

2020, due to galvanized steel demand. 

However, the skilled labor shortage in Australia 

could pose a threat to the Asia-Pacific 

zinc industry, as the second largest zinc 

company in the region has been experiencing 

a skilled labor shortage. Beginning in 

2004, the situation worsened as the global 

financial crisis forced the resources sector 

to lay off around 28,300 personnel in 2008- 

2009. Since then, as the industry has gradually 

recovered, the shortage has become 

more apparent and is soon expected to become 

a major concern. 

Asia-Pacific zinc ore production was about 

6.6 million tonnes in 2011 and during the period 

2012-2020, production in Asia-Pacific is 

estimated to increase at a CAGR of about 

4% to 9.6 million tonnes. China was the 

major contributor to r egional production in 

2011 with 58.3% and is expected to r emain 

the leading source in the future. 



Myanmar is open to mining investment 

WITH Myanmar’s economy starting to open up 

after years of isolation fr om the West, foreign 

investment in mining is being actively encouraged 

by the new government. Indicative of the 

interest now being shown in the country’s relatively 

unexploited r esources was the attendance 

of more than 300 participants fr om 25 

countries at the inaugural Myanmar Mining 

Summit in the capital Yangon during July. 

The event was organized by Singapor e- 

based CMT (Centre for Management Technology) 

along with the country’ s mines 

ministry. CMT’s event manager Fu Huiyan 

said: “The response was really positive as mining 

companies and investors are really keen 

to explore the opportunities in Myanmar’s mining 

sector.” It was so positive that CMT is already 

planning the country’s second mining 

summit for January 2013. 

With a wealth of minerals and natural r e- 

sources, from oil and coal to copper , gold 

and zinc, mining companies around the world 

are keen to invest in Myanmar but ther e are 

still challenges to overcome, including overhauling 

laws to ensure investors are protected 

when putting up their funds, development 

of infrastructure and overhauling the banking 

system. Myanmar ranks 180th, a spot shared 

with Afghanistan, on Transparency International’s 

list of the world’ s most graft-ridden 

countries, which ranks 183 nations. 

A Ministry of Mines of ficial, Win Htein, told 

delegates: “For investors who would like to do 

exploration to confirm the reserve of a deposit 

or to start with the grassroots exploration operations 

in a virgin land, they may apply accordingly 

clearly stating their intentions. Funds 

required to conduct the prospecting, exploration 

and feasibility study are borne by the investor 

100% at their own risk.” He said that as 

the export of ores is not allowed, the gover n- 

ment is encouraging firms to set up mineral 

processing plants and export the product. 

The conference was told that seven for eign 

companies from Australia, China, Russia, Thailand 

and Vietnam already have mining operations, 

in zinc, ir on, gold and other metals. 

Global Resources Corp’s chairman Stephen 

Everett says smaller Australian exploration and 

mining firms are well placed to enter Myanmar. 

“Australian entrepreneurial junior companies 

are often the first movers going into remote 

areas,” Stephen Everett says pointing 

to examples in South America, Africa and 

parts of Asia. “We have a significant track 

record in terms of being ahead of the game 

in terms of exploration processing.” He says 

Australia’s strong reputation in environmental 

and social responsibility will work in favour 

of new investors. 

A Canadian company has already applied for 

a licence to explore for gold deposits in remote 

central Burma. Northquest’ s president and 

CEO Jon North, a geologist by trade, says he 

as optimistic that his company will win an exploration 

permit from the government. 

Antimony technical collaboration in Myanmar 

INTEGRATED antimony exploration and development 

company Tri-Star has entered into an 

agreement with RDP Singapore (RDPS) under 

which Tri-Star will provide technical collaboration 

and advice to RDPS in r elation to its Myanmar 

antimony pr ojects, which include 

exploration rights surrounding two existing producing 

deposits and any additional antimony 

projects identified there by Tri-Star or RDPS. 

The first stage of the agr eement will involve 

Tri-Star providing technical expertise to RDPS 

and performing a series of geological and metallurgical 

assessments at the antimony pr o- 

: A sample of antimony mineralization. Myanmar is a rich source of antimony ore material. 

jects. Following the completion of the initial assessment 

work, the board of directors of Tri- 

Star will make a decision regarding any further 

collaboration with RDPS. The Boar d expects 

this initial work to be completed within 6 to 12 

months and subject to the r esults of the assessments 

the Board will consider further investment 

in the projects and seek to negotiate 

an exclusive offtake arrangement with RDPS. 

RDPS, a subsidiary of Resour ce Development 

Partners, the London-based mining finance 

house specializing in natural resource 

investments. RDPS is a private holding company 

incorporated in Singapore which invests 

in the Myanmar mining industry, in addition to 

other sectors. The principals, James Hyndes 

and Christian West, have regional investment 

and mining experience, and are supported by 

a strong board with members based in South 

East Asia and Myanmar. 

RDPS has identified two operating antimony 

mines in Myanmar and will focus on expanding 

the surrounding prospective areas 

over which it owns the exploration rights. 

RDPS is engaged in seeking other projects of 

merit and its strategy is to develop str ong 

local relationships in key commodity sectors. 

Tri-Star’s managing director Emin Eyi says, 

“The experience RDPS has, together with the 

strength of its relationships locally, means the 

company is very well positioned to develop opportunities 

in Myanmar and we look forward to 

utilizing our geological and metallurgical skills 

in assisting them, and in turn the Myanmar resource 

industry, to improve standards and enhance 

exploration and pr oduction potential. 

Importantly, we are encouraged by the possible 

sourcing of raw materials which can potentially 

be processed at Tri-Star’s proposed UAE 

roaster facilities in the future.” 




Mongolia 

Positive magnetite test results from Selenge 

METALLURGICAL test results have confirmed 

the quality of the magnetite ore at Haranga Resources’ 

Selenge Iron Ore Project and represent 

a substantial progression of the project. 

All three prospects tested produced a consistent, 

premium quality magnetite concentrate 

with an average grade of more than 65% iron 

and very low average silica content. 

Coarse grind Davis Tube Recovery (DTR) 

tests were completed on 469 composite 

samples representing the entirety of the iron 

mineralization drilled thus far at Bayantsogt 

deposit while DTR tests were completed on 

all zones of mineralization drilled at the Dund 

Bulag and Huiten Gol prospects. 

The tests showed that on the whole contaminant 

levels are low, apart from sulphur at 

Bayantsogt. This can be floated, as it is primarily 

in pyrite, or blended with the nearby 

lower sulphur material. The concentrates produced 

are of excellent quality and would 

achieve a significant price premium. 

Selenge’s higher grade zones may be upgradable 

using simple ‘crush and screen’ followed 

by dry magnetic separation. This is the process 

used at the neighbouring Eruu Gol mine, Mongolia’s 

largest iron ore export mine. Beneficiating 

the higher grade zones close to surface at Selenge 

in this manner would allow for earlier commercial 

production and Haranga plans further 

test work to examine this potential outcome. 

Selenge is in the heart of Mongolia’ s premier 

iron ore development region with excellent 

access to the main Trans-Mongolian rail 

liner and nearby rail spurs. Ir on mineralization 

has been identified at four primary exploration 

targets, all within 10km of each 

other. All four targets ar e associated with 

large magnetic skarn hills and lie within a 

well-defined structural corridor than contains 

the major iron ore deposits in the region. 

The 2011 drill program was concentrated at 

Bayantsogt, the northernmost of the targets 

but first pass drilling was also conducted at 

Dund Bulag and Huiten Gol. The Bayantsogt 

program yielded an initial inferr ed resource of 

32.8 million tonnes at an average 

grade of 24.4% iron and 

included some higher grade 

zones. It was based on the 

first 35 holes drilled and mineralization 

remains open in all 

directions and at depth. Further 

extension and infill drilling 

is expected to expand the resource 

and convert most of it 

to the JORC measur ed and 

indicated categories. 

Dund Bulag is the largest 

of the magnetite skar n hills 

at Selenge, coincident with 

a magnetic anomaly mor e 

than twice as large as Bayantsogt in ar ea. 

Five holes were drilled along one cross section 

in 2011 with four containing very wide 

iron intersections. An exploration target of 

120-250 million tonne has been set. Huiten 

Gol was the third target to be drilled but no 

exploration target has yet been set. The drilling 

intersected thinner, higher-grade lodes 

of iron from surface. 

Another magnetite skarn hill at Undur Ukhaa 

looks to be an adjunct of nearby Dund Bulag 

and will be drilled this year along with a number 

of other similar anomalies at Selenge that ar e 

yet to be ground checked. The 2012 Selenge 

drilling program has recently begun. 

Drilling by Haranga Resources at the Haranga Iron Ore Project in northern Mongolia. 

Voyager to seek KM mining licence 

VOYAGER Resources has started work to 

convert existing exploration licences at the 

KM Copper Project in southern Mongolia into 

mining licences and expects this pr ocess to 

be completed later this year. This follows the 

successful completion of a study aimed at reviewing 

the extensive drilling, geology and 

geophysical database generated at KM in the 

last 12 months. This study has identified a 

number of high priority drill targets. 

The KM project is in the Erdene Island Arc Terrain, 

which is one of a number of tectonic ter - 

rains that extend across the Gobi and southern 

regions of Mongolia that have been pr oven to 

host a number of mineralized copper porphyry 

systems, including the giant Oyu Tolgoi deposit. 

Results generated by Voyager at KM have 

been highly encouraging. More than 50,000 

metres of drilling has highlighted some of the 

most promising copper results in Mongolia 

since the discovery of Oyu Tolgoi. These results 

and the r ecent study, supports Voyager’s 

belief that KM has the potential to host 

a significant copper porphyry system. 

The company’s primary focus is now targeting 

the larger copper porphyry and it will undertake 

a more comprehensive and targeted 

drill program in the latter half of this year . The 

company may also look to utilize deeper induced 

polarization (IP) technology in the coming 

months as this has pr oven to be highly successful 

in targeting drill holes at Oyu Tolgoi. 

Although little work has been completed on 

the Daltiin Ovor Copper -Gold Project in the 

past 12 months, Voyager has recently undertaken 

ground magnetics and it has now commenced 

soil geochemistry across the project. 

Daltiin Ovor is northeast of KM in south central 

Mongolia and 600km southwest of Ulaanbaatar. 

The project, which is within the Bayankhongor 

Gold Belt, The project has been previously 

trenched and drilled with high grade gold, silver 

and copper mineralization being identified in 

three separate exposures located over a strike 

length of about 900 metres. 

No further activity has been undertaken by 

Voyager at the Khongor Copper-Gold Project 

in southern Mongolia and the company is assessing 

a number of options to further advance 

the project. 

Voyager has raised about $4.464 million in 

an option entitlement issue with the funds to 

be primarily used to focus on additional drilling 

and the application for a mining licence at KM. 


Mongolia 

Oyu Tolgoi ahead of schedule for production 

THE massive Oyu Tolgoi Copper-Gold Project of Rio T into and Turquoise 

Hill Resources, formerly Ivanhoe Mines, is nearing completion 

and remains on track for commer cial production in the first half of 

2013. At the end of July construction work was 94% complete and 

initial output of copper and gold concentrate is set to begin befor e 

the end of this year, six months ahead of schedule. 

nstalling a ball mill at the Oyu Tolgoi project of Oyu Tolgoi LLC. 

Construction of an overland conveyor at the Oyu Tolgoi Copper-Gold Project. 

Rio Tinto is managing the development of Oyu Tolgoi and owns a 51% 

stake in Turquoise Hill, which in turn holds a 66% stake in the project to 

the Mongolian government’s 34% interest. The Mongolian operating 

company for the project is Oyu Tolgoi LLC. The cost for the first phase 

of development is not expected to exceed the forecast US$6.2 billion. 

In addition to bringing forwar d the completion date by finishing 

an extraordinary amount of construction in 27 months instead of 

33, the progress has also enabled pr oduct marketing while the 

price of copper is stable, which is of great significance to the financial 

vitality of Mongolia. 

Oyu Tolgoi, Mongolian words that in English mean ‘turquoise hill’, is 

one of the world’s largest undeveloped copper and gold assets, with a 

measured and indicated resource estimated at 41 billion pounds of 

copper and 21 million ounces of gold. The project employs more than 

9600 Mongolians in development and nearly 1700 domestic entities 

and organizations have supplied the pr oject since its inception. Additionally, 

more than 1000 domestic suppliers provided goods and services 

valued at US$1.3 billion to the project in 2011 alone. 

Oyu Tolgoi LLC is committed to contributing to a sustainable future 

for Mongolia. At least 9 out of 10 employees will be Mongolian once 

the mine is in pr oduction and Oyu Tolgoi is investing US$58 million 

dollars in training and education, and an additional US$27 million in 

the Workforce Employment Project designed to help address the general 

skills shortage in Mongolia. 

Additional diesel-powered electrical generating capacity has been 

installed at the South Gobi Desert site to meet power needs during 

construction, and electrical transmission lines running from neighbouring 

China are in place but the project is still waiting for a supply agreement 

to be signed between the two countries befor e power can be 

imported. Turquoise Hill Resources says transmission lines in Mongolia 

and China have been tested with full power loads and ar e ready for 

commissioning, and the venture is pushing on with arrangements to 

ensure power from China is available in the second half of the year. 

Commercial discussions on a power deal between the countries 

continue, it said, adding that if negotiations aren’t successful a dedicated 

power plant will be r equired which will set back the start of 

commercial output. 

As well as providing a major boost to Mongolia’s economy, the project 

is also contributing to development of infrastructure. A new international 

standard airport is being constructed with a runway mor e 

than 3km-long and capable of r eceiving Boeing 737 and C130 air - 

craft. The Khanbumbat airport site will boast the single largest piece 

of concrete to be poured in the Gobi, if not Mongolia. Using three separate 

machines in a ‘Paving Train’ which paves just under a metr e 

of concrete with 44cm thickness in a minute, the concrete will be laid 

in months, not years. The airport development pr oject is scheduled 

to be completed by October 2012. 

The new name for Ivanhoe Mines was approved by shareholders 

at the annual meeting on June 28. Turquoise Hill’s chief executive 

officer Kay Priestly says, “Changing our name to Turquoise Hill Resources 

marks another milestone in our corporate history. Our new 

name more closely aligns the company with our world-class Oyu 

Tolgoi project and will have added significance as we rapidly approach 

the start of production.” 


Mongolia 


Mongolia 

A coal seam at Prophecy Coal’s Chandgana project in central Mongolia. 

Prophecy to acquire Tugalgatai licences 

PROPHECY Coal is consolidating its coal 

holdings in the Chandgana Basin of central 

Mongolia by agreeing to purchase assets 

relating to certain Tugalgatai coal exploration 

licences from Tethys Mining LLC. The 

Tugalgatai licences are contiguous to Prophecy’s 

Chandgana licences which host a 

measured resource of 650 million tonnes 

and an indicated r esource of 540 million 

tonnes of thermal coal. 

According to records reviewed by Prophecy 

Tethys applied to register a resource estimate 

of 2.33 billion tonnes of thermal coal for the Tugalgatai 

licences with the Minerals Resour ce 

Council of Mongolia. The resources registered 

by Tethys are not NI 43-101 compliant. Pr o- 

phecy expects to conduct work in due course 

with a view of preparing an NI 43-101 estimate 

of the contained resource at Tugalgatai. 

Since announcing the proposed acquisition, 

Prophecy has arranged a US$10 million 

secured debt facility with W aterton 

Global Value with these funds to be used to 

complete the purchase of the Tugalgatai licences. 

Waterton Global’s portfolio manager 

Cheryl Brandon says, “We look forward 

to working with Prophecy Coal to finance 

the company as they continue to expand in 

the Chandgana Basin. The Waterton Global 

facility provides the required capital to complete 

the $10 million coal licence acquisition 

and implement the company’s production 

growth strategy in the region.” 

Since 2005, Tethys has performed detailed 

exploration on the Tugalgatai licences 

including drilling and geophysical methods, 

and conducted geotechnical, hydrogeological, 

environmental and topographic studies. 

Exploration results indicate a large 

and geologically simple coal occurr ence 

within these licences that is similar to Prophecy’s 

Chandgana licences. The coal 

seam is continuous acr oss the Nyalga 

Basin and outcrops to the northwest, with 

the main coal seam measuring up to 30 

metres in thickness. 

Prophecy’s chairman and CEO John Lee 

says, “By consolidating the Chandgana coal 

basin of about 300sqkm, Prophecy is looking 

for greater economies of scale to potentially 

produce low-cost electricity at the Chandgana 

mine mouth power plant, and further 

develop coal to chemicals and coal gasification 

projects. It’s also possible to further increase 

the resource through exploration in 

this highly prospective basin.” 

Meanwhile, Prophecy has recently temporarily 

suspended mining operations at its 

Ulaan Ovoo pr oject in the country’ s north 

owing to the fact that its stockpile of 187,000 

tonnes is sufficient to meet contractual supply 

obligations through the balance of 2012. 

About 80 mining staff were laid-off and paid 

aggregate severance of about $100,000 to 

comply with local employment laws. Some 

15 staff members remain on site for equipment 

and site maintenance, shipping and security 

operations during the shutdown. 

The shutdown is expected to run for around 

6 months but could end sooner if any significant 

new coal sale agr eements are entered 

into. Start-up can be implemented in a matter 

of weeks. Management is using the downtime 

to work with Mongolian of ficials to seek road 

and bridge improvements, and to open Zeltura 

border to facilitate Russia export sales. 

Prophecy debuts power division 

PROPHECY Coal has debuted 

Prophecy Power Corp, the company’ s 

wholly-owned Mongolian subsidiary focused 

on the power sector in Mongolia. 

Prophecy Power, formerly known as 

East Energy Corp, was incorporated in 

2010 with the specific business objective 

of supplying power to Mongolia through 

construction of the Chandgana Thermal 

Power Plant. Another Pr ophecy subsidiary 

Chandgana LLC will develop the 

Chandgana Coal Pr oject in parallel to 

ensure fuel supply to Prophecy Power. 

Prophecy Power’s proposed 600MW 

mine mouth power plant complex will be 

built next to Prophecy Coal’s Chandgana 

coal deposit in central Mongolia, next to a 

paved highway, just 60km fr om Undurkhann 

for the east electricity grid connection 

leading to Choibalsan and 120km 

from Baganuur for the west electricity grid 

connection leading to Ulaanbaatar. 

Prophecy Power obtained approval of 

its Environmental Impact Assessment 

(EIA) from the Ministry of Natur e and 

Tourism in November 2010. In November 

2011, the Ministry of Natural Resour ces 

and Energy granted a construction licence-the 

first of its kind in Mongolia.. 

Since obtaining this licence, the company 

has been in discussions with the 

Mongolian government to finalize a power 

purchase agreement (PPA) to secur e 

Mongolia’s long-term energy supply, and 

enable project financing and construction 

to move forwar d. In parallel, Pr ophecy 

Power has been in discussions with several 

private Mongolia companies r egarding 

bi-lateral power purchase agreements. 

A coal supply agr eement is in place 

whereby Chandgana LLC will supply 3 

million tonnes of coal annually. 

In December 2011, Prophecy Power distributed 

a request for proposal to six engineering, 

procurement and construction 

(EPC) contractors. After site visits and technical 

sessions were conducted Prophecy 

received proposals from all six contractors 

and in July shortlisted three based on construction 

capability, equipment quality, time 

to deployment and price. Pr ophecy is in 

discussions with candidates to formulate 

final quotes, and expects to finalize EPC 

selection by October 1. 


Mongolia 

Joint venture finds coking coal projects 

THE Ekhgoviin Chuluu LLC joint ventur e 

company of Xanadu Mines and Noble Group 

has signed an agreement to earn an 80% interest 

in the Khus Coking Coal Pr oject and 

has also signed an option agreement for the 

Khar Servegen Coking Coal Pr oject, both in 

the South Gobi region of Mongolia. Exploration 

drilling began at the former in July while 

due diligence began on the latter also in July. 

Ekhgoviin Chuluu (EC) was formed in early 

2011 with Noble Group to be the vehicle to 

acquire and explore for quality hard coking 

coal targets in Mongolia. EC maintains its 

own technical team with the head coal geologist 

having prior in country experience with 

a large US group. Noble and Xanadu’s Ulaanbaatar 

office provides high level oversight to 

EC in both technical and commercial matters. 

EC has over the past 12 months acquir ed a 

number of early stage licence ar eas which are 

prospective for coking coal and of a pr oduct 

quality sufficient to withstand softer end mar - 

kets. EC has recently acquired two licence areas 

in the south which will be subject to initial exploration 

programs during the current quarter. EC 

will continue to develop its existing and potential 

asset base over the balance of this year. 

The Khus pr oject is strategically located 

490km south-southeast of Ulaanbaatar and 

140km north of Khangi-Mandula port at the 

Chinese border. Reconnaissance reverse circulation 

drilling has started with 10 widely spaced 

drill holes planned for about 3000 metres. 

It is about 25km northeast and along-strike 

from the recently discovered Ail Bayan Bituminous 

Coal Mine. No physical exploration 

has been carried out to date, however EC 

geologists believe this greenfield project may 

potentially represent the basin extension from 

the Ail Bayan coal deposit. 

The highly prospective Khar Servegen project 

is about 620km southwest of Ulaanbaatar, 

125km northeast of Ceke-Shiveekhur en 

port at the Chinese border and 70km east of 

Ovoot Tolgoi/Nariin Sukhait Bituminous coking 

coal mines. Due diligence drilling and 

coal quality analysis is under way. 

Xanadu is progressing with divestment of 

its two thermal coal assets, Khar T arvaga 

and Galshar, to focus its attention on its EC 

coking coal joint venture and its copper and 

gold portfolio. A number of parties have 

held discussions with Xanadu on the assets 

and Macquarie Capital (Hong Kong) Ltd is 

advising on this process. 

Xanadu also has the Nuurstei Coking Coal 

Project in the south central part of the Khuvsgul 

Province. The two contiguous licences lie 

about 13km south-southwest of the provincial 

centre of Moron and are only 8km fr om the 

proposed Northern Mongolian rail line that will 

link Moron with the rail spur at Erdenet. 

Xanadu Mines has a number of prospects throughout Mongolia. The coal prospects are indicated by the black 

stars, the metal prospects by the red stars and the joint venture coking coal prospects by yellow stars. 

Xanadu to begin Elgen-Zost drilling 

XANADU Mines will this month begin a 

10,000 metre reverse circulation drill program 

at the Elgen-Zost Gold Pr oject in southern 

Mongolia following the award of a contract to 

Major Drilling. The project consists of three 

low to intermediate sulphidation epithermal 

prospects - Elgen Uul, Suug and Zost Uul - 

within a 35km-long east-west orientated corridor 

of alteration and mineralization with the 

main exploration target being high-grade gold 

in quartz-aldularia veins at depth. 

The precious metal exploration project is in 

Dornogovi Province, about 680km southsoutheast 

of Ulaanbaatar . It is just 30km 

north of the Mongolian-Chinese bor der and 

the international border crossing at Mandal. 

Exploration drilling has been carried out at 

the Sharchuluut Uul (Yellow Mountain) porphyry 

copper pr oject with four holes for 

3197.8 metres. All holes reached their target 

depths and were completed without incident. 

Drilling has shown that the Sharchuluut alteration 

system is impressive in size and vector 

IP suggests it may extend east-west with 

at least 2km strike length, and be up to 400 

metres thick in multiple advanced argillic 

zones. The general interpretation of the lithocap 

and geological structur e suggests the 

porphyry source for the advanced argillic alteration 

zones lies to the south, or possibly 

along strike of the lithocap. Assay results are 

expected shortly but Xanadu believes Shar - 

chuluut has the hallmarks of a porphyry system 

with very large-scale potential. 

The Amgalant copper-gold porphyry project 

is in Omnogovi Province of southern Mongolia, 

about 480km south-southeast of Ulaanbaatar. 

It is in the central part of the highly prospective 

South Gobi Porphyry belt, about 

110km northeast of the Oyu T olgoi coppergold 

deposit and less than 40km west of the 

Tsagaan Suvarga copper-molybdenum deposit. 

Reconnaissance exploration and geophysics 

have commenced at the pr oject with a 

total of 200 grab samples were taken. 

Meanwhile, Xanadu continues to pr ogress 

activities to meet certain conditions pr ecedent 

related to the acquisition of the Oyut 

Ulaan porphyry copper project (OU) from Temuujin 

Mining Corp. OU is about 275km 

northeast of Oyu Tolgoi and 60km west of the 

industrial centre of Sainshand and the main 

Trans Mongolian Railway. Limited exploration 

has been completed on the project. 


Mongolia 

SouthGobi curtails coal operations 

A COMBINATION of external factors has 

seen SouthGobi Resources curtail operations 

at its Mongolian pr ojects with little 

change expected this quarter. Uncertainty 

created by the proposed proportional takeover 

of the company by the Aluminum 

Corporation of China Limited (Chalco) 

which resulted in a Mineral Resources Authority 

of Mongolia move to suspend exploration 

and mining activity on certain 

licences and the gover nment unveiling a 

new law to cap foreign investment in strategic 

sectors, various infrastructur e constraints 

in Mongolia and the softening of 

inland China coking coal markets ar e primary 

factors behind the decision. 

During the second quarter operations 

were wound back but by the end of June 

they had been fully curtailed with the company 

also suspending uncommitted capital 

expenditures and exploration expenditures. 

For the thr ee months to June 30 

SouthGobi produced 270,000 tonnes of 

raw coal compared to 870,000 tonnes for 

the same period in 2011. 

In the same period the company sold 

160,000 tonnes at an average realized selling 

price of US$62.56 per tonne compar ed to 

sales of 1.05 million tonnes at an average 

price of US$54.06 per tonne in the second 

quarter of 2011. Customers were reluctant to 

enter into significant sales contracts during 

this period owing to the uncertainty facing the 

company as well as the softening of China’s 

markets closest to SouthGobi’s operations. 

Other factors centred on constraints at Shivee 

Khuren border crossing during the first 

half of the year . The opening of expanded 

border crossing infrastructure was delayed; 

the crossing was closed for extended periods 

during the Chinese New Year and Mongolian 

Tsagaan Sar public holidays; and the existing 

gravel road used to transport coal fr om 

SouthGobi’s Ovoot T olgoi mine and 

neighbouring mines to the crossing was closed 

for more than four weeks. 

On May 28, the expanded bor der crossing 

infrastructure, consisting of eight new 

border gates exclusively for coal transportation, 

opened at Shivee Khur en. The expanded 

border crossing infrastructure will 

eliminate the existing bottleneck and is expected 

to incr ease annual capacity to 

about 20 million tonnes or mor e. In June, 

due to the expanded infrastructure, South- 

Gobi’s customers exported 580,000 tonnes 

of Ovoot T olgoi coal, mostly fr om 

customer inventories, to China, r epresenting 

a monthly export record from the mine. 

Due to the uncertainty surrounding South- 

Gobi’s business, the company anticipates its 

operations will remain fully curtailed in the 

third quarter. Further, it cautions that production 

volumes, sales volumes and pricing for 

the full year of 2012 cannot be estimated. 

Its largest shar eholder Ivanhoe Mines 

and Chalco have agreed to an additional 

30-day extension to the pr oportional takeover 

bid. Chalco has agr eed to make a 

takeover bid on or before September 4 and 

thereafter the bid must be taken up after 

36 days at the earliest if conditions ar e all 

met. Ivanhoe has enter ed into a lock-up 

agreement and has agreed to tender all its 

SouthGobi shares to Chalco. 


Mongolia 

ONGOING drilling by Kincora Copper has intersected 

significant high-grade copper at the 

Bronze Fox project and gold at the Tourmaline 

Hills project. Of particular significance is 

a 180 metre intersection of continuous copper 

mineralization at the West Kasulu zone of 

Bronze Fox in southeast Mongolia. 

The West Kasulu discovery is at the centre 

of Kincora’s group of exploration licences and 

at the west border of licence 15000X. This licence 

is 140km northeast of Oyu Tolgoi and 

sits in the same metallogenic belt. 

Partial drill core from a recent hole intersected 

the 180 metre interval. The average 

copper grade acr oss the 180 metr es is 

0.5% copper and 0.1 grams/tonne gold 

with associated molybdenum mineralization 

up to 0.33%. This included 37 metres averaging 

0.829% copper, 0.14 grams/tonne 

gold, and 0.04% molybdenum fr om 573 

metres or 1.11% copper equivalent. This, in 

turn, included 13 metres from 595 metres 

averaging 1.14% copper, 0.17 grams/tonne 

gold and 694ppm molybdenum, equating 

to a copper equivalent of 1.57%. 

High-grade copper intersected at Bronze Fox 

The mineralization begins from surface and 

remains open at depth. Further cor e cutting 

and sampling is ongoing with the hole continuing 

below 1000 metres. The results confirm 

the potential for a deep high grade 

porphyry-style copper deposit and incr ease 

management’s confidence that the exploration 

program could be reaching the edge of 

Copper mineralization in a core sample from the West 

Kasulu zone of Kincora’s Bronze Fox project. 

a large, high-grade copper and gold r e- 

source. Further drilling will test the extent of 

the mineralization and will track the halo east 

and west which runs for 2km. 

Kincora’s president and CEO John Rickus 

says, “These exciting results confirm that higher 

grade zones exist within this exceptionally 

large system. For the r emainder of the year 

our team will continue to explore a number of 

high priority targets to establish the extent of 

the copper and gold mineralization on the 

Bronze Fox properties.” 

Partial assays have also been r eturned for 

the Tourmaline Hills pr oject, one of the licences 

acquired from Forbes and Manhattan 

through an exchange of shares in April 2012. 

Further core cutting and sampling is ongoing. 

The best results are: 1 metre from 39 metres 

@ 2.74 grams/tonne gold and 5 metr es 

from 60 metres @ 2.65 grams/tonne; 6 metres 

from 39 metres @ 0.67 grams/tonne with 

up to 1.18 grams/tonne and 1 metr e from 

154 metres @ 0.8 grams/tonne; 14 metr es 

from 273 metres @ 0.39 grams/tonne with up 

to 1.49 grams/tonne. 

Kincora has recently closed a non-brokered 

private placement of convertible notes with 

Origo Partners PLC valued at up to US$2.5 

million. Origo is the largest shar eholder of 

Kincora with 29.28%. Proceeds of the placement 

will be used for further development on 

Kincora’s properties in Mongolia. 


Mongolia 

Maiden coal resource for Teeg licence 

DRAIG Resources has announced a maiden 

JORC-compliant ivresource of 75 million tonnes 

for its Teeg licence in central southern Mongolia 

plus an additional exploration target of between 

25 million and 1200 million tonnes. The JORC 

report adds that there is compelling evidence for 

a significant deposit of high-grade coal with metallurgical 

potential in a coal seam with a true 

average coal thickness of 24.12 metres. 

The 22.2sqkm Teeg licence is in the Bayanteeg 

district of Ovorhangay province and is 

one of eight licences owned by Draig across 

the Ovorhangay and South Gobi regions. The 

Ovorhangay licences are about 130km from 

the provincial capital Aryayheer and about 

520km southwest of Ulaanbaatar. 

The resource estimate was determined using 

the results of geological mapping, trenching, induces 

polarization and resistivity surveys, 6784 

metres of drilling and coal sample analysis. Draig 

believes the results confirm the highly prospective 

nature of Teeg and the wider Bayanteeg 

area. Logging of the drill data has encouraged 

the company. Coal was intercepted in 18 holes 

of the phase 1 drill program over 6000 metres. 

A series of steeply-dipping coal seam intersections 

were logged at shallow open-pit mineable 

depths along a north-westerly strike. 

The first phase drill pr ogram was focused 

Draig Resources’ coal licences are in the Ovorhangay and South Gobi provinces of southern Mongolia. 

on confirming one of the potential sequences 

identified in a 2011 due diligence pr ogram, 

which intersected black coal seams of up to 

40 metres. Two drill rigs worked ar ound the 

clock to achieve up to 300 metr es per day, 

with one rig diamond drilling to cor e the representative 

coal intervals for quality and petrographic 

analysis. The best coal seams 

intercepted were those with an appar ent 

thickness of between 36 and 86 metres. 

The company’s managing director Mark 

Earley says, “All the coal we intercepted was 

relatively shallow and definitely at open pit 

mineable levels. The T eeg licence shows 

great promise, based on the drilling we have 

done to date. Our aim is to complement 

these results with the drilling to be undertaken 

in our phase 2 pr ogram which will include 

our South Gobi licences. 

“Defining a 75 million tonnes coal r esource 

plus the exploration target is an excellent achievement, 

particular after only one exploration 

drilling campaign on Teeg. We now have a significant 

coal resource, our resources are at 

open pit mineable levels and we have identified 

large drill target areas to pursue.” 

Altan Rio starts Chandman-Yol drilling 

DRILLING has started at the Chandman-Y ol 

copper-gold porphyry project in western Mongolia 

after Altan Rio Minerals secur ed a contractor 

for the work. The 3000 metre diamond 

drill program is targeting two high-priority tar - 

gets identified during the company’s field work 

in 2011 and have not been drilled before. 

The Ovoot target was discovered by reconnaissance 

profiling and is the str ongest anomaly 

identified at Chandman. It is near 

surface and of substantial size, with dimensions 

of more than 2km-long, 1km-wide, and 

up to 800 metres thick. Copper staining is visible 

in vertical fractur es at surface dir ectly 

above the IP feature, which provides strong 

evidence of geochemical leakage from depth. 

Ovoot represents a compelling target for potentially 

large tonnage resources. 

The Takhilt target hosts outcropping coppergold 

porphyry intrusion with disseminated copper 

oxide staining. Follow-up soil geochemical 

sampling has delineated a r obust copper soil 

anomaly about 600 metres in diameter. Rock 

chip sampling locally assayed up to 30 

grams/tonne gold and +1% copper . Takhilt 

also represents a compelling target for shallow, 

but potentially large-scale, resources. 

Altan Rio has also announced that its ear n- 

in for 90% of one of the Onon epithermal gold 

tenements in northeast Mongolia is expected 

to be completed this quarter. “The company 

will complete the final stage of the ear n-in by 

issuing private Mongolian company Er denyn 

Erel LLC 240,000 common shares in the capital 

of Altan Rio. The remaining two Onon tenements 

are already owned by the company ,” 

says Altan Rio’s president Evan Jones. 

Onon is an early stage gold exploration project 

where previous work has identified numerous 

gold and arsenic anomalies associated 

with epithermal-style mineralization. The three 

tenements cover an area of 137sqkm. 

Meanwhile, results from the inaugural 1902 

metre drilling campaign at Altan Rio’ s Khavchuu 

gold project in northern Mongolia have 

confirmed significant gold anomalies. Seven 

wide-spaced reconnaissance core holes were 

drilled at the 71sqkm pr oject between March 

and May this year, with five holes intersecting 

major gold and/or arsenic anomalies which are 

known to indicate orogenic gold deposits in the 

region. One hole intersected high grade gold 

of 11.49 grams/tonne over 1 metre in an area 

on the edge of a large Boroo granitoid. 

Evan Jones says, “I am pleased to shar e 

this discovery of high grade gold mineralization 

in a Boroo-style geological setting with 

potential large tonnage possibilities. Our exploration 

team has successfully demonstrated 

its ability to target and explor e the large 

Khavchuu gold system, only 10km from Centerra 

Gold’s Boroo mine and mill complex. 

We are encouraged by these results.” 


Company Profile 

Techenomics: Analyzing oil for better efficiency 

TECHENOMICS is an independent laboratory with more than 15 

years’ experience in oil analysis in Indonesia. Techenomics uses 

an internationally recognized ASTM method tailored to work the 

oil analysis to provide maximum benefits to customers. The company 

operates in South East Asia through PT Tekenomiks Indonesia 

(PTTI) as well as in Australia, Madagascar and Mongolia. 

PTTI’s laboratory has also been accredited according to 

ISO 17025. A special feature is that customers are free to 

discuss and consult directly with engineers so that they not 

only get accurate analysis results but also can get solutions 

to the problems encountered in their respective units. 

PTTI is able to analyze oil from a wide range of products 

but has also developed other more specialist lubricant tests, 

including hydraulic foaming testing and engine coolant tests. 

Oil analysis is the analytical examination of a lubricant’s 

property, suspended contaminants and wear debris. It is performed 

during routine preventative maintenance to provide 

meaningful and accurate information on lubricants and the 

machine’s condition. Oil analysis is the best tool to penetrate 

into the working heart of the equipment to reveal vital information 

about its condition and performance. 

Techenomics laboratories are capable of analyzing many 

different types of lubricants in both petrol and diesel engines 

from mining companies, power stations, agricultural machinery, 

paper mills, offshore, marine, road and rail freight companies. 

Techenomics can test wear metal, viscosity, TBN, tan, 

cleanliness and the lubricant viscosity. All this is done in accordance 

with updated ASTM standards. To ensure the accuracy 

of results, the company is also registered for ASTM 

International’s Interlaboratory Cross Check Program. 

Hydraulic foaming testing 

With hydraulic foaming testing an 

analysis is done in accordance with 

ASTM D 892 where the foaming 

tendency and foaming stability are 

assessed. Foam tendency describes 

the amount of foam generated immediately 

after the fluid is agitated 

and aerated, while foam stability 

quantifies the amount of foam remaining 

10 minutes after cessation 

of aeration. This work is supported 

by other analyses such as cleanliness, 

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content. This enables customers to 

Members of the team from PT Tekenomiks Indonesia. 

better determine the cause of the 

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Coolant testing 

As the automotive industry grows 

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build-up of contamination. Engine 

coolant testing at Techenomics 

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shown that a majority of engine 

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problems like pitting, cavitation, 

corrosion, electrolysis and erosion; 

improper maintenance of 

the fluid can create a negative 

impact on the engine system and 

engine coolant testing can identify 

these problems. 

Fuel testing 

Diesel fuel analysis can identify potential 

causes for fuel filter plugging, 

smoking, loss of power, poor injector 

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position sensors and sticking valves. 

Testing also confirms a diesel fuel’s 

sulphur content, biodiesel content 

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warranty requirements. 

Transformer oil analysis 

Transformer oil analysis is an essential 

part of a cost-efficient 

maintenance program. It is well 

known that regular oil analysis is 

useful in monitoring the condition 

of engines, turbines and other oil 

lubricated equipment. The same 

can be said for transformer oils 

used to insulate many transformers 

and other electrical distribution 

equipment. The analysis of insulating 

oils provides information 

about the oil, but also enables the 

detection of other possible problems, 

including contact arcing 

and aging insulating paper. 

Refurbishment of waste oil 

PTTI has developed a system for 

processing used oil that can be 

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blasting process. Use of used oil is 

proven to reduce diesel fuel consumption 

and can deliver cost reductions 

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benefits. 

One customer is Kitadin Tandung 

Mayang, part of the Banpu 

Group, which has a used oil processing 

unit with an hourly capacity 

of 600 litres. With daily oil 

consumption in blasting averaging 

3000-4000 litres, the use of used 

oil has resulted in annual savings 

of about $1.5 million. 


LPT Tekenomiks Indonesia laboratories have been accredited according to ISO 17025. 

Oil analysis and condition 

monitoring software 

Mining companies spend hundreds 

of thousands, even millions, 

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equipment, but what if you 

could prevent a lot of these costs, 

extend the life of your equipment, 

lower unscheduled downtime and 

save your company money 

Techenomics can help do this with 

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equipment maintenance, including 

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lubricant and fuel usage, and 

monitor the wear on magnetic 

plugs and trays. 

Results for each sample are reviewed, 

interpreted and managed 

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and recommendations given by 

trained technicians with a background 

in equipment maintenance 

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Oceans also manages the results 

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With this software package, users 

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their past and present oil monitoring 

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monitoring, and oil and fuel 

analysis. Blue Oceans software 

also offers a flexible reporting format 

that can be modified to suit 

the specific needs of customers. 

Techenomics’ Blue Oceans customized 

maintenance software, 

provides the ability to monitor 

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usage, oil analysis, data 

trending, magnetic plug inspections, 

static wear tray monitoring 

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Importing and exporting 

historical data 

Techenomics has multiple options 

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condition monitoring data from 

the existing company or from the 

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Historical data is owned by the 

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Historical data importing times 

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Strong customer base 

Established since 1996 in Indonesia, 

PTTI has developed a strong 

customer base because it offers a 

total service, beginning with a standard 

lubricant analysis. From the initial 

customer of Thiess Indonesia, 

PTTI has grown to have three laboratory 

OA and a fuel lab in Indonesia 

as well as a lab OA in Bangkok, 

Thailand. PTTI is committed to developing 

and improving its service capabilities 

with additional test 

parameters tailored to customer 

needs and quality-based commitment. 

ISO 17025 is evidence that 

PTTI always ensures that its services 

are globally accepted and accredited. 

The company is at present averaging 

20,000 samples each 

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that to 25,000 in the near future. 

PTTI has a customer base that includes 

the owner, dealer OEM and 

contractor company in a number of 

mining operations, including KPC 

Sangatta Coal Mine, Indonesia 

Hexindo Dealer Hitachi, Liebherr Indonesia, 

SIS, Madhani, Adaro Indonesia, 

Banpu Group, Thiess 

Indonesia, Laos Pan Aust, Aggreko, 

Komatsu Reman, Volvo Inta, etc. 

Techenomics brings its expertise to Mongolia 

Tuul Tomorok is Techenomics 

brand ambassador. 

LUBRICATION and condition monitoring specialist 

Techenomics International has set up a 

new laboratory in Ulaanbaatar, Mongolia, 

to cater for the country’s growing mining industry. 

Techenomics is an independent company 

that provides oil analysis, fuel analysis, 

coolant analysis, and lubrication and filtration 

solutions for fixed and mobile plants as 

well as expert testing of all petroleum fluids 

across Australia, Madagascar and Asia. 

In Mongolia, Techenomics will operate 

as it does throughout Australia, Asia and 

Madagascar, and help companies reduce 

maintenance costs, extend the life of their equipment, lower 

unscheduled downtime and save mining companies millions by 

providing preventative maintenance tools. 

Initially the laboratory in Mongolia is providing services for a full 

range of oil analysis tests for engine oil, all other lubricated compartments 

and hydraulic oil. The laboratory will also provide on line vibration 

analysis for fixed plant and selected specialty lubricants such as 

wire rope lubes and drill pipe greases. 

A team from Techenomics recently attended the Future Mongolia exhibition 

to introduce the service to Mongolia and received more than 

100 serious visitors out of which has developed many opportunities. 

As well as setting up the laboratory Techenomics has signed Mongolian 

model Tuul Tomorok as the company’s brand ambassador after Tuul 

represented it at Future Mongolia. In this role Tuul will work with Techenomics 

to help raise awareness of the company’s progression and development 

in oil analysis, condition monitoring and lubrication in the 

Mongolian market. Techenomics has also appointed other staff members 

in Mongolia including Anuu (Bazar Mandy) who will assist with 

establishment of the laboratory and customer relations. 


Mongolia 

Meritus makes Gutain Davaa progress 

THE high grade gold resource at the Toordogiin 

Shil prospect on Meritus Minerals’ Gutain 

Davaa project has been accepted for r egistration 

by the Mongolian Mineral Resources 

Council after review and approval by a number 

of experts. Under the Mongolian system, 

which is required to be used for registration, 

the resource is classified as a B+C Resource 

of 3.17415 tonnes of gold at an average 

grade of 5.73 grams/tonne gold. 

Due to methodology used this r esource is 

not compliant with NI 43-101 or JORC Code 

reporting standards. The resource can be expressed 

in conventionally-used language as 

Meritus Minerals’ Gutain Davaa Gold Project is in Mongolia’s northeast. 

approximately 550,000 tonnes grading 5.73 

grams/tonne gold for 102,000 ounces of contained 

gold. The resource has been assessed 

on the basis that it only includes mineralization 

that could be available for underground mining. 

Meritus is also pleased that its new partners 

are making good pr ogress with advancing 

the project. An Environmental Impact Assessment 

(EIA) has been completed and presented 

to the Ministry of Natur e Environment 

Tourism and the local soum (district) administration 

for their evaluation. Other activity of 

significance that benefits the pr oject has 

been the extensive repairs carried out to the 

only bridge in this district acr oss the Onon 

River to allow better access to the site. 

The partners are also making considerable 

effort in explaining the project and its potential 

benefits to the local community and ar e reviewing 

with the local authorities methods by 

which the local community will benefit and 

can be involved in the project. Preliminary discussions 

with the Mineral Resource Authority 

of Mongolia are under way with the objective 

of entering into a pre-mining agreement. 

Subsequent to the issue of a default notice 

and termination of the Gutain Davaa Option 

Agreement, Meritus has successfully renegotiated 

the terms of the agr eement with the 

non- defaulting party, Asmos Co Ltd. The altered 

terms see Asmos r equired to make a 

non-refundable subscription of US$350,000 

on or before August 31 and on payment it will 

be issued with 12.75% of the shar es in 

Gutain Davaa LLC and be entitled to a seat 

on the boar d of that company . Total payments 

to complete subscription for 51% of 

the shares in Gutain Davaa LLC have been 

reduced from US$4 million to US$3.5 million 

which must be contributed within 12 months 

of the start of production. The incoming party 

is now entitled to write of f their pre-production 

development costs against futur e revenue 

from the pr oject after making the 

contributions due to Gutain Davaa LLC. 

High-grade gold confirmed at Argo Zone 

TRENCHING and sampling on the near-surface 

Argo Zone at Entrée Gold’s Shivee West project 

has confirmed the presence of high-grade gold. 

One of the tr ench samples r eturned 81.4 

grams/tonne gold over 3 metr es with the area 

of gold mineralization being extended 140 metres 

further north from that defined by a reverse 

circulation (RC) drilling program in 2011. 

The area now measures about 400 metr es 

long by up to 130 metres wide and is part of a 

larger mineralized area that includes the Zone III 

gold target. The entire area of known gold mineralization 

has now been traced more than 700 

metres along strike and r emains open. Nearsurface 

gold mineralization at Argo is hosted by 

quartz veined felsic volcanic r ocks associated 

with a 2.5km-long magnetic low. Work in 2011, 

which included 23 vertical RC holes for 2470 

metres) and 1120 linear metr es of excavator 

trenching and surface sampling, helped define 

two distinct zones of shallow gold mineralization 

- Zone III and Argo Zone. 

Twelve excavator trenches totalling 1240 linear 

metres were recently completed for 

sampling, geological mapping and to aid in 

interpretation of the zone. Apart fr om the 3 

metres @ 81.4 grams/tonne, other results include 

6 metres @ 2.24 grams/tonne, 3 metres 

@ 3.10 grams/tonne and 6 metr es @ 

3.76 grams/tonne. 

Entrée’s president and CEO Gr eg Crowe 

says, “The expansion in size of the near -surface 

Argo Zone is extremely encouraging. The 

presence of very high grade gold values, occurring 

within a much larger gold system, attests 

to the potential of this new discovery . 

This zone has geological similarities to some 

of the volcanic- hosted gold deposits of Nevada 

and Mexico. The Argo Zone will continue 

to be a priority focus for further exploration. 

“Our wholly-owned Shivee West property is 

distinct from our joint venture ground, which 

hosts the Hugo North Extension and Heruga 

deposits adjacent to the Oyu Tolgoi project of 

Rio Tinto and Turquoise Hill Resources (formerly 

Ivanhoe Mines). The first phases of Oyu 

Tolgoi mine development are advancing on 

schedule, including development of Lift 1 of 

the Hugo North Extension deposit. First development 

production from the joint venture 

ground is expected in 2015.” 

Entrée’s JV partner, Oyu Tolgoi LLC, continues 

to explor e various targets on the JV 

ground. Diamond drilling of a Cretaceous covered 

area, 7km north of Hugo North Extension 

and to the west of Ulaan Khud, began 

on June 25 with 29 initial holes planned. 


Mongolia 

Ovoot Mongolia’s third largest coking coal reserve 

ASPIRE Mining has announced a maiden 

JORC-compliant resource at its Ovoot pr o- 

ject of 178 million tonnes, making it Mongolia’s 

third largest coking coal r eserve. The 

consultants who completed the estimate 

have also noted that a further 8 million tonnes 

of inferred resources may be mined at the 

open pit. This additional tonnage has been 

included in the mine plan as ‘Run of Mine’ but 

is not included in the reserve estimate. 

The company delayed completion of its prefeasibility 

study (PFS) in April to allow for inclusion 

of quality data for r esource and reserve 

remodelling. The Ovoot PFS will therefore show 

a mine and production plan for 185 million tonnes 

of coal mined producing 153 million tonnes 

of coking coal. The pr oject covers 509sqkm 

across three separate licences, with much exploration 

work focusing on the Ovoot licence 

area. The Hurimt and Zuun Del licences will be 

more actively explored this year. 

Aspire’s managing director David Paull says, 

“The confirmation of a significant initial open pit 

coal reserve of 178 million tonnes and clear 

scope to increase this to more than 200 million 

tonnes means Ovoot is comparable with the 

largest coking coal reserves in Mongolia outside 

of the government-owned Tavan Tolgoi. 

“Aspire will work through 2012 to increase 

Ovoot’s coal reserves and resources, however, 

we are also strongly focusing on the project’s 

infrastructure requirements, including 

establishment of a multi-user rail line facility . 

Part of that process will be gaining necessary 

government and financial support to progress 

Aspire’s subsidiary, Northern Railways LLC 

and the Erdenet to Moron rail extension.” 

An independent review of the rail PFS has 

highlighted that an alter native direct rail 

alignment connecting Ovoot to Er denet (bypassing 

Moron) could result in capital savings 

of about US$188 million. The review by Calibre 

Rail has also identified the potential to significantly 

reduce operating costs over the life of 

the project that will be further explored in a second 

iteration of the rail PFS. Possible changes 

to some of the operational parameters could 

lead to an additional availability of about 8 million 

tonnes for other users to access. 

Calibre reviewed the 406km multi-user rail 

alignment from Erdenet to Mor on and the 

222km spur line connecting to Ovoot, and tested 

a number of alternatives that showed potential 

to reduce capital and operating expenditures. 

The r eview essentially confirmed the 

alignment from Erdenet to Moron as being the 

most efficient with some minor modifications 

that will need to be confirmed by detailed 

ground surveys. However, Calibre addressed 

the question of what is the most ef ficient path 

for Ovoot coking coal. The study suggests an 

alternative alignment 50km south of Mor on, 

connecting Ovoot directly to Erdenet. 

This alignment reduces the distance by 47km 

and reduces capital expenditure by about $188 

million due to more agreeable terrain. A 57km 

spur line would be r equired to connect to 

Moron should this be justified or sealed r oad 

access to the main line could handle the for e- 

cast volume of freight and passengers. 

A mine site plan and indicative pit design for Aspire Mining’s Ovoot Coking Coal Project. 

Centerra resumes drilling at ATO 

CENTERRA Gold has resumed drilling at the 

Altan Tsagaan Ovoo (ATO) project after the 

Mineral Reserve Authority of Mongolia 

(MRAM) formally accepted the ATO reserves 

and resources as calculated by Centerra 

Gold Mongolia. The initial estimate for A TO 

shows a measured and indicated resource of 

824,000 ounces of contained gold together 

with significant silver, lead and zinc and an inferred 

resource of 26,000 ounces of contained 

gold together with silver, lead and zinc. 

Drilling is targeting extensions and feeders 

to the pipe-like bodies hosting the current resource 

and possible strike extensions to the 

nearby Mungu prospect. Infill soil sampling, 

IP and trenching have outlined the surface 

expression of Mungu over some 600 metres 

of strike length. Drilling will continue at Mungu 

and ATO through the third quarter of 2012. 

Metallurgical test work is ongoing, and hydrological 

and environmental programs are 

progressing according to plan. The ATO General 

Environmental Impact Assessment 

(GEIA) has been officially approved by the Ministry 

of Nature, Environment and Tourism. 

Authorities also outlined watershed areas within 

the boundaries of the exploration licence. 

Centerra has increased planned exploration 

expenditures in Mongolia to US$9 million for 

2012 to fund exploration and advanced project 

studies on the A TO project and to advance 

exploration on other projects along the 

Onon Trend in eastern Mongolia. 

At Centerra’s Boroo project, after accounting 

for processing of about 84,000 

ounces of contained gold in 2011, proven 

and probable reserves total 298,000 ounces 

of contained gold. At the reserve gold 

price assumption, the Bor oo operation 

could potentially continue to feed the mill 

for more than two years utilizing existing 

low-grade stockpiles. 


Mongolia 

Modun resumes drilling at Nuurst 

MODUN Resources has resumed drilling at 

the Nuurst Thermal Coal Pr oject in central 

Mongolia to assist in its application for a mining 

licence. The focus of the pr ogram is to 

complete some infill drilling in the south-eastern 

corner of the current JORC-compliant 

coal resource, which sits at 489 million tonnes 

and comprises 4117 million indicated 

tonnes and 72 million inferred tonnes. 

The work will be used to increase the level of 

confidence in the resource and provide important 

hydrological, geotechnical and structural 

information for a scoping study . Modun expects 

that the mining licence will be granted 

later this year. In addition to the infill drilling, a 

reconnaissance exploration drilling program will 

be carried out 6km north of the existing r e- 

source area to identify the potential for coal 

seam development on the remainder of the licence 

area. Nuurst is 120km south of Ulaanbaatar 

and 6km from existing rail infrastructure. 

Exploration plans have been lodged with 

The Nuurst Thermal Coal Project of Modun Resources is in central Mongolia while the Tsagaan Tolgoi project, which is 

the subject of a proposed acquisition from SouthGobi Resources, is in the country’s south. 

government authorities and subsequently approved 

to allow exploration activities to r e- 

sume during the curr ent quarter. 

Paleontological and archaeological surveys 

have been completed with neither finding any 

sites of significance on the project area. 

A focus for Modun earlier this year was the 

proposed acquisition of the T sagaan Tolgoi 

coal deposit and Ajlyn Talbai exploration licence 

from SouthGobi Resources. On April 16 the 

Mineral Resources Authority of Mongolia 

(MRAM) requested SouthGobi to suspend exploration 

and mining activity on certain licences 

owned its wholly-owned division SouthGobi 

Sands LLC. As a result Modun and SouthGobi 

agreed to extend the time to complete the proposed 

acquisition to December 31, 2012. 

It remains unclear as to whether the actions 

of MRAM will impact the pr oposed acquisition 

and Modun continues to work with SouthGobi 

to seek clarification regarding its ability to obtain 

the necessary approvals to transfer the mining 

licence. As a result Modun is undertaking a review 

of the commercial and regulatory aspects 

of the proposed transaction to ensure it acts in 

the interests of existing shareholders. Modun’s 

Board says the recent few months have been 

challenging in Mongolia with significant uncer - 

tainty created by the introduction of new foreign 

investment laws and a general election. 

Erdene to fully focus on Mongolia 

ERDENE Resource Development Corp is separating 

its North American interests into a different 

company in or der to focus fully on its 

Mongolian assets. This follows Erdene entering 

into an agreement with Advanced Primary Minerals 

Corporation (APM) to exchange all of Erdene’s 

North American pr operty interests, 

comprised primarily of its interest in the Donkin 

Coal Project in Nova Scotia for shares of APM. 

Morien Resources has been selected as the 

new name for the merged company between 

Erdene subsidiary ERI and APM, subject to receiving 

all requisite approvals. John Budreski, 

who was appointed to Er dene’s Board in January 

2012, is the new CEO designate. 

Erdene’s CEO Peter Akerley says, “As we 

move towards restructuring our company to 

allow for a more focused approach to development 

of the Donkin pr oject and to our 

Mongolian exploration efforts, it was an important 

initial step to ensure we identified an 

individual who possesses the management 

expertise and broad experience to lead the 

North American business. We are very pleased 

that we have been able to secur e as 

CEO someone of John’ s calibre. The new 

name was selected to reflect the rich mining 

history of the ar ea. Port Morien, the village 

adjacent to Donkin, was the site of the first 

commercial coal mining in North America and 

the first mineral exports from Canada.” 

Meanwhile, drilling and surface prospecting 

at Erdene’s Altan Nar (Golden Sun) pr operty 

in southwest Mongolia continues to expand 

the gold discovery. A 9-hole, 2029-metr e, 

core drilling program was carried out earlier 

this year to follow-up pr evious drilling completed 

late last year. 

Drilling has confirmed lateral and vertical 

continuity of gold-silver mineralization within 

the Discovery Zone. All holes intersected mineralized 

zones with gr eater than 1 

grams/tonne gold, and anomalous silver, lead 

and zinc thus confirming the widespread nature 

of the mineralized epithermal system. 

The zone was extended to the north with 

an intersection of 27 metr es @ 1.78 

grams/tonne gold, including 8 metres @ 4.5 

grams/tonne gold and 25.4 grams/tonne silver. 

High-grade gold mineralized zones were 

intersected at depth at the north end with 4 

metres @ 10.5 grams/tonne gold and 56 

grams/tonne silver. Mineralization has been 

extended to depth greater than 180 metres 

within the zone, over a 300 metre strike. 

Discovery Zone is characterized by br oad 

zones of gold mineralization, including 74 

metres of 0.61 grams/tonne gold. A new 

gold-silver mineralized zone was also discovered 

about 1km northwest. 


Mongolia 

New wing at UHG process plant 

MONGOLIAN Mining Corporation (MMC) has opened a second wing of 

the processing plant at its Ukhaa Khudag (UHG) Coal Pr oject. The wing 

has capacity to process 850 tonnes of coal each hour, or 5 million tonnes 

a year, and will increase annual processing at the plant to 15 million tonnes. 

The first wing opened more than 12 months ago, shortly after the government 

approved construction of the second wing. Total costs for construction 

and installation of the latest UHG wing amounted to US$91 million. 

Energy Resources’ chief executive officer Battsengel Gotov says the company, 

the Mongolian subsidiary of MMC, plans a third wing which will allow 

Energy Resources to become an exporter of processed coal. 

Current and proposed transport infrastructure servicing MMC’s UHG and Baruun 

Naran coal projects. 

MMC is one of the country’ s largest coking coal exporters. It mines 

the UHG project which is part of the large T avan Tolgoi deposit in the 

South Gobi, and has recently acquired and started production of Baruun 

Naran, another coking coal deposit nearby. Independent Mongolian investment 

banking firm Monet LLC says MMR r emains, in its view, the 

most successful and stable coal mining operation in Mongolia. Located 

250km from China and 5km fr om the West Tsankhi of Erdenes Tavan 

Tolgoi, UHG deposit is one of 6 deposits in the Tavan Tolgoi coal structure. 

It has resources of 700 million tonnes. MMC began production in 

April 2009 and UHG is now the country’ s biggest coal exporter. It has 

13 seams with coking and thermal coal resources mixed. 

While export coal is transported on private road to China, the Mongolian 

Government has approved construction of a railway from UHG 

to the Gashuun Sukhait border crossing. The railway will have initial 

annual capacity of 15 million tonnes by running 6 trains per day, which 

will be further doubled in the future to 12 trains. 

Monet says in a research report that construction of the 240km railway 

allows MMC to further cut the cost of transportation. “The big elephant 

in the room for the project is the rail gauge, which the government has 

set to match the Russian standard (1520mm). This can possibly create 

a logistics bottleneck at the border where coal has to be transferred to 

Chinese trains as the Chinese use the standard (1435 mm) gauge.” 

MMC has cut its 2013-14 overall coal output target by more than 13% 

due to coking and thermal coal price dif ferentials, logistical issues and 

weaker demand. It has delayed plans to start pr oducing thermal coal, 

and now won’t do so until the railway to China comes into service in 

2015, although it will boost coking coal output next year. 

It is targeting 2013-14 coking coal output of 12-13 million tonnes, 

up from 10 million planned earlier, but now won’t produce an anticipated 

5 million tonnes of thermal coal. “We revised the production 

plan as the profit margin of coking coal is higher thermal coal,” Battsengel 

Gotov says. “Once the railway is in place, transportation 

costs will be lower and the economic benefit of selling thermal coal 

will become appealing.” 

Two Central Asia Metals projects for sale 

CENTRAL Asia Metals has two of its thr ee Mongolian assets up for 

sale and hopes to gain between 6 million and 10 million UK pounds 

from the process. The company is seeking buyers for the Handgait 

molybdenum exploration project in northern Mongolia and the Ereen 

gold project 130km north of Ulaanbaatar. 

It still holds a third project, Alag Bayan, which is prospective for copper/gold 

and is in the middle of Mongolia’s prolific copper-gold porphyry 

mineralization trend in the south, 100km from the world-class Oyu Tolgoi 

copper gold deposit. While the company does not have further funds 

to contribute at present, initial drilling has pr oved promising and more 

work is expected to take place over the next year or so. 

The 80%-owned Handgait project has a JORC classified resource 

estimate of about 41,000 tonnes of metal. This molybdenum resource 

is adjacent to the Russian border, near the large Pervomaisky molybdenum 

deposit (35 million tonnes @ 0.11%). The ar ea is suitable for 

open-pit mining with conventional flotation infrastructure estimated to 

deliver an 82% recovery. In September 2011, Central Asia completed 

a 1500-metre drilling campaign on the identified geochemical anomaly 

to follow-up an extensive exploration and aggressive core-drilling program 

completed in 2008 of 78 holes for 12,241 metres. 

The 85%-owned Ereen gold project, in the centre of Mongolia’s historic 

mining district, has a JORC-classified resource estimate of 773,000 

ounces. The target area consists of a continuous gold mineralization 

trend of 1500 metres long, 400 metres wide, and 20 to 30 metres thick. 

Suitable for open-pit mining, the project is close to Centerra’s Gatsuurt 

(1.2 million ounce) and Boroo (1.2 million ounce) operations. 

There is a total r esource of 19.94 million tonnes @ 1.206 

grams/tonne gold for 773,600 ounces, which includes 19.73 million 

inferred tonnes @ 1.211 grams/tonne for 768,000 ounces. Exploration 

drilling has been targeting a +1 million ounce resource. 

At the 40sqkm Alag Bayan licence exploration has identified large 

anomalies similar to the footprints shown at Oyu Tolgoi. 


Mongolia 

Sharyn Gol receives Shaazgait approvals 

MONGOLIA’S Ministry of Nature, Environment 

and Tourism has accepted the Environmental 

Impact Assessment Report for 

Sharyn Gol’s planned new open pit mine at 

the Shaazgait thermal coal deposit. Following 

the r ecent approval of its feasibility 

study by the Mineral Resources Authority of 

Mongolia, Sharyn Gol has now received all 

government approvals necessary to launch 

operations at Shaazgait. 

Mining at the Sharyn Gol coal operations in northern Mongolia. 

The new open cast mine will enable Sharyn 

Gol to retain its role as a supplier of low ash, 

low sulphur, and high calorific value pr oduct 

to the local market. Additionally, the company 

is well positioned to utilize its existing infrastructure 

to expand into both regional and international 

thermal coal markets. 

Recent coal washability test work, performed 

by the Stewart Laboratory in Ulaanbaatar , indicated 

that a product with 6500 kcal/kg heat 

value, less than 10% ash and 0.5% sulphur (all 

air dried basis) can be produced with high plant 

yields. These results are consistent with Sharyn 

Gol being able to pr oduce a premium export 

quality thermal coal. 

Consequently, Sharyn Gol’s management is 

reviewing strategic options for washing and exporting 

coal to maximize potential revenue streams 

in coming years. Sharyn Gol is in a strong 

financial position, with a US dollar equivalent 

cash balance of $10 million and no debt. 

Sharyn Gol’s chairman Batkhuu Batmunkh 

says, “We are pleased that the development 

of the new mining area at Shaazgait remains 

on schedule, and are excited by the prospect 

of realizing our vision of launching moder n 

commercial operations before the year-end.” 

Originally a state-run enterprise developed 

to supply local utilities, Sharyn Gol was privatized 

and listed on the Mongolian Stock Exchange 

in 2003. It has been mining coal at 

the Sharyn Gol mine in the country’s north for 

more than 45 years, supplying both domestic 

and export customers pr edominantly for 

power generation, but also for specialized 

uses, such as semi-coking end users. 

The release of a new JORC r esource estimate 

over the property in February 2011 indicated 

the presence of a significant thermal coal 

deposit (374 million tonnes), with the possibility 

of further additional exploration upside from several 

identified areas. Stage 1 of a pr oduction 

expansion program is under way, aimed at increasing 

annual output from 500,000 tonnes 

to 1 million. Stage 2 will see pr oduction increase 

further to 2.5 million tonnes, lengthening 

the expected mine life by decades. 

A dedicated 65km rail spur links the mine 

to the T rans-Mongolian Railroad, offering 

Sharyn Gol dir ect access to Russia and 

China, and beyond to the markets of Japan, 

Taiwan and South Korea. 

ADEN Services Remote Site growing in Mongolia 

ADEN Services Remote Site has formed a joint 

venture partnership to pr ovide international 

standard camp management services in Mongolia. 

Together with its partners New Age Mongolia 

LLC, a fast gr owing Mongolian service 

company, and Xillion LLC, an investment consulting 

firm for oil and gas companies, the 

company celebrated the creation of ADEN Services 

Mongolia LLC joint venture, at the beginning 

of July 2012 in Ulaanbaatar, Mongolia. 

ADEN Services came to Mongolia in 2002 

confident about the potential of the country 

and the huge challenge it represents in terms 

of size, temperature variations and the little 

developed infrastructure. The lack of qualified 

and experienced personnel in many sectors 

and a need for high quality camp management 

services were factors that drove ADEN 

Services to form the partnership which represents 

a combination of local experience and 

international expertise and as a majority Mongolian-owned 

entity, offers clients an international 

standard camp management services 

from a Mongolian company. 

Through this JV partnership and the network 

of local contacts in complimentary sectors 

ADEN Services is able to of fer a wide 

range of services including pr ocurement 

(camps & equipment - fr om individual items 

through to 100% tur n-key projects), camp 

construction (in conjunction with our local 

EPCM partner), camp management services 

including catering, cleaning, laundry, maintenance 

and camp management. 

The partnership commenced services on its 

first project earlier this year with a significant procurement 

contract followed by camp management 

services for Hunnu Resources LLC project 

in South Gobi desert. More success quickly followed 

this year when the JV signed a second 

contract for full camp management services for 

a 200 man camp also in the South Gobi. 

But beside the traditional job, ADEN Services 

also cares about ethical standar ds 

and the responsibility toward local communities. 

The company has adapted CSR 

(Corporate Social Responsibility) programs 

to the specifics of the region and cooperates 

with several NGOs in Mongolia. 

Through the training and mentoring pr o- 

grams and with the inter national trainers 

ADEN Services is ensuring that all staf are 

empowered with skills and knowledge that 

will allow them car eer development long 

after the mines have gone. 

Driven by this fast development in the 

country, the joint venture has recently opened 

a new office in Ulaanbaatar. This move 

demonstrates the strategic importance of 

Mongolia to the ADEN Services network 

and ADEN believes that its unique positioning 

in the market will ensur e healthy 

growth of its business in the coming years. 


Company Profile 

Mera provides total blasting and explosives service 

This is an exciting new and historic time for the mining industry in Mongolia. Mining is developing rapidly and is broadening 

from just exploration, mining and transporting out of the country with many new mineral output channels beginning to open 

up. In this interview, Mera LLC chairman Mr Gantumur T, focuses on the explosives and blasting sectors. Mera is a 100% 

nationally-invested company that provides drill-blast services and manufactures explosives. 

What are the changes 

taking place in the 

blasting sector 

in Mongolia 

First of all, it is an honour for me to 

address dear clients and customers 

of Mera LLC as well as all readers 

through your magazine on this special 

year of the 90th anniversary of 

formation of Mongolia’s mining sector. 

The sector has been steadily developing 

for 90 years and today, 

there are 13 foreign and nationallyinvested 

plants of ANFO and emulsion 

explosives as well as more than 

100 companies specially authorized 

to hold blasting operation for mining 

production in Mongolia. 

The market for explosives this 

year in Mongolia is forecast at 

80,000 tonnes and the capacity 

of the explosives plants of foreign 

and nationally-invested companies 

is already more than 100,000 

tonnes. The international companies 

which open branches in Mongolia 

are competing with the 

existing foreign and local companies 

in the Mongolian market. 

What are the differences 

in quality of production, 

services provided, 

capacity of human 

resources and techniques, 

and technologies 

between international 

companies and 

Mongolian companies 

The level of development of companies 

providing blasting operations 

and manufacturing explosives 

varies. There are national companies 

praised by their customers for 

providing products and services better 

than those provided by international 

companies, but at the same 

time there are companies weak in 

human resources, techniques and 

technologies, and their own experiences, 

and some with poor financial 

management. 

Introducing the best techniques 

and technologies to the blasting 

sector must always be emphasized. 

About 70% of the explosives plants 

in Mongolia manufacture products 

with Chinese and Russian technologies, 

and about 30% manufacture 

explosives with modern technologies 

by developed countries such 

as USA and Australia. 

Could you give us a brief 

introduction of your 

business and what 

advantages it has over 

its competitors 

Mera LLC is the only national company 

which provides complex drillblasting 

service and manufacture 

explosives in Mongolia. In 2006, 

we established a 100% nationallyinvested 

ANFO plant with US technologies 

and started producing, and 

selling three kinds of ANFOs, such 

as ‘Ayanga’, ‘Ayanga-powered’ 

and ‘Ayanga-water resistant’, in accordance 

with international standards. 

With this achievement we 

were named ‘The Domestic Investor- 

Entrepreneur’ of Mongolia in 2006. 

We then established and opened an 

emulsion non-blasting ingredients 

plant using ‘T12’ Australian techniques 

and equipment as well as 

Australian-Russian joint technology. 

This enabled us to produce Nitronit 

brand emulsion explosives which 

have been used in blasting operations 

at Tavan Tolgoi coking coal deposit. 

Our company was named as 

‘The best Technology-Know How Entrepreneur’ 

of Mongolia in 2011. 

Mera completes all blasting operations 

on its own. 

Mera is the leading 

company in this sector in 

Mongolia. Is this because 

the sector itself requires 

a lot of wealth, 

knowledge and skills 

I agree with that. In order to do this 

business well, you have to pay 

plenty of costs and expenses. Those 

who have enough finance always 

win many advantages than others in 

any sector. Mera carries out its activities 

with no loan to any financial 

organization, which gives us the 

chance to introduce the best techniques 

and technologies before 

other companies are able to do so. 

How many customers and 

clients does MERA LLC 

cooperate with today 

Currently, we provide drill-blasting 

services for Ukhaa Hudag mine of 

Energy Resource LLC, Erdenes Tavan 

Tolgoi mine of Erdenes Tavan Tolgoi 

JV, Baruun Naran coal mine of 

Hangad Exploration LLC, Zasag 

Chandmani iron ore surface/open 

pit mine of Zasag Chandmani 

Mines LLC and Olon Ovoot gold 

mine of Olon Ovoot Gold LLC. We 

do the blast hole charging service at 

the coal mine of Baganuur JS company, 

and supply explosives and 

blasting accessories to companies 

such as Tavan Tolgoi JSC, Erdenet 

Mining Corporation, Mogoin Gol 

JSC and Boldtumur Eruu Gol LLC as 

well as at industries and companies 

that have special licences for blasting 

operations. We have just won a 

contract with the Terra Energy LLC to 

provide drill-blasting services. 

What advantages do you 

gain by implementing 

international standards 

Our company started implementing 

Quality Management System 

ISO 9001:2008 in all our operating 

processes and manufacturing, 

and received the certificate in 

2010. This testifies to our clients 

that Mera has a system that confirms 

its products and services 

meet the requirements of international 

standard quality. At the 

same time Mera is proven as a national 

level pioneer company in 

the manufacturing of explosives 

and in blasting services by demonstrating 

the possibilities to provide 

services to a worldwide company’s 

standard. Mera LLC is 

proud of being an example to 

many companies. 

What will Mera LLC do 

to expand market share, 

enhance its reputation 

and improve customer 

satisfaction 

Our customers are the core of our 

business. The focus of our further 

work will be: improving and expanding 

services and production; 

introducing new services based on 

the requirements; enhancing sales 

channels; introducing the international 

standard OHSAS; producing 

raw materials for explosives in 

our country; and to enter the 

worldwide market. 


China 

China’s copper demand set for revival 

China is still the driving force behind the world’s copper industry. Photo Vismedia. 

A REVIVAL of Chinese copper demand in the 

second half of 2012 is expected to help 

boost the global market when the outlook for 

European demand is less pr omising due to 

the Euro zone crisis, according to Europe’s 

biggest copper smelter, Aurubis. “There is 

talk on the copper market that the second 

half of 2012 could develop better than the 

first,” Aurubis said in a r eport. “The primary 

reason for this assumption is the expectation 

of higher copper demand in China based first 

and foremost on the Chinese gover nment’s 

economic support measures, which could be 

reflected in better copper demand.” 

Two of the most important copper demand 

drivers in China are continued urbanization 

and measures to improve the energy supply 

and energy efficiency, it said. “Momentum for 

the recovery of demand is also expected 

from additional infrastructure projects, the automotive 

sector and the energy cable sector. 

“In contrast, Eur ope looks less pr omising,” 

it said. “Southern Europe in particular 

is influenced by the eur o crisis. While demand 

on the Eur opean spot market has 

been revived recently and the pr emiums 

have therefore climbed above the levels of 

the annual contracts, this is most likely due 

to delayed shipments and extr emely low 

copper inventories of about 13,500 tonnes 

in the European LME warehouses.” 

The spot market for copper copper tr eatment 

and refining charges (TC/RCs) is quiet 

and traders are offering volumes of copper 

concentrates for refining at short notice, it 

said. TC/RCs are paid by miners to smelters 

to refine concentrate into metal and are a key 

part of the global copper industry's income. 

Chinese smelters do not want to buy spot 

concentrate supplies for refining at under a 

TC/RC of $50 a tonne and 5.00 cents a 

pound, Aurubis said. 

Chinese state-run metals r esearch company 

Beijing Antaike says China’s 2012 domestic 

output of copper pr oducts is 

expected to grow 10-15% from 2011, less 

than the 18% growth seen last year. It attributes 

the slower output to weak demand expected 

from key downstr eam consuming 

sectors. In 2011, China produced 10.28 million 

tonnes of copper products, up 18% from 

2010, data from China Nonferrous Metals Fabrication 

Industrial Association (CNF A) 

showed. This year over January-May, China 

produced 4.33 million tonnes of copper products 

up 10% year on year , CNFA figures 

showed. Zhejiang, Jiangsu, Anhui and Jiangxi 

provinces accounted for the bulk of the January-May 

output. 

“Demand growth in the electronic, machinery, 

as well as transport sectors this year 

may be limited, but we see the power sector 

to be the principal demand driver ,” Antaike 

commodity analyst He Xiaohui said. “Judging 

from the association’s recent figures, we see 

this year China’s copper products output to 

be 10-15% higher than last year’s levels.” 

As of end-2011, China’s domestic copper 

products annual processing capacity was 12 

million tonnes, figures from CNFA showed. In 

May this year, CNFA had said China could 

face a copper pr oducts supply surplus by 

2015 as more than 3 million tonnes/year of 

new capacity was set to come online during 

the 2011-15 period. CNFA, however, did not 

elaborate on details on the ongoing projects. 

中国铜需求回升 

欧洲最大的铜冶炼商 Aurubis 公司称 , 估计 

2012 年下半年 , 中国铜需求回升将为全球 

铜市提供支撑 , 但受欧债危机忧虑拖累 , 欧 

洲的铜需求前景不理想。Aurubis 在一份报 

告中称 ,“ 人们在谈论 2012 年下半年的铜需 

求将会好于上半年 ”。“ 其中主要的原因在于 

预计中国的铜需求会因政府的经济刺激措施 

而增加。” 

报告称 , 目前推动中国铜需求的两个最重 

要的因素就是持续的城市化和能源供应改善 

以及能源使用效率提升。“ 中国的基础设施 

建设、汽车制造业和能源线缆业也为铜需求 

回升提供支撑。” 

报告指出 ,“ 但欧洲的铜需求则不那么乐 

观。”“ 欧债危机对南欧地区的影响更大些。 

尽管近期有迹象显示欧洲现货铜需求有所改 

善 , 目前的铜升水已经高于年度合约水平 , 

但这主要是受发运推迟和欧洲的 LME( 伦敦 

金属交易所 ) 铜库存处于极低的水平 , 约 

1.35 万吨。” 

报道称 , 现货铜精矿的加工精炼费 

(TC/RCs) 较为稳定 , 贸易商在短期内供应大 

量铜精矿用于精炼。TC/RCs 是开采商支付 

给冶炼商用于将精矿加工成金属的费用 , 是 

全球铜业收入的一个主要来源。中国铜冶炼 

商不愿意在 TC/RCs 低于每吨 50 美元和每磅 

5 美分的水平采购铜精矿。 

中国国营金属研究机构北京安泰科表示 , 

预计 2012 年中国铜产品产量比 2011 年增长 

10%-15%, 低于 2011 年 18% 的增长幅度。 

产量增长放缓的原因在于来自下游主要消费 

领域的需求疲软。 

中国有色金属加工工业协会 (CNFA) 的数据 

显示 ,2011 年中国铜产品产量为 1028 万 

吨 , 比 2010 年增长 18%。今年 1-5 月 , 中国 

铜产品产量为 433 万吨 , 同比增长 10%。1- 

5 月份的产量主要来自浙江、江苏、安徽和 

江西这几个省份。 

“ 今年电子、机械以及运输行业的需求增 

长或许有限 , 但是我们看到电力行业需求将 

是主要推动力量 ,” 安泰科的商品分析师何 

晓辉说道。“ 从最近的数据看 , 估计今年中 

国铜产品产量将比去年增长 10%-15%。” 

CNFA 的数据显示 , 截止到 2011 年年末 , 

我国铜产品加工能力为 1200 万吨 / 年。今 

年 5 月份 ,CNFA 曾表示 , 2011 年 -15 年期间 

将有增加超过 300 万吨的新产能上线 , 到 

2015 年中国将会面临铜产品供应过剩。但 

是 ,CNFA 对这个正在进行的项目没有进行 

详细说明。 


China 

Jiangsu plant achieves battery grade quality 

LITHIUM carbonate pr oduct from Galaxy 

Resources’ wholly-owned Jiangsu Lithium 

Carbonate Plant has achieved battery grade 

quality across all specifications, meeting the 

plant’s design. This means that as well as 

adhering to the 99.5% purity criteria, the 

production now meets the prescribed tolerances 

for impurities required by its cathode 

producing customers. Battery grade lithium 

carbonate must meet stringent specifications, 

with allowances for only certain levels 

of impurities such as calcium, magnesium, 

iron, sulphate and sodium. 

Sample material is being deliver ed to Galaxy’s 

existing clients, 13 major battery cathode 

producers in China and Mitsubishi Corporation 

of Japan, under of ftake framework agr eements 

for qualification testing and confirmation. 

In the meantime, Galaxy continues to sell 

final product to technical grade customers at 

strong pricing levels. Battery grade lithium carbonate 

commands a significant pricing pr e- 

mium over mor e common technical and 

industrial grade material. The achievement of 

battery grade product is an important milestone 

in the ramp-up of the Jiangsu plant. 

Galaxy’s managing director Iggy Tan says the 

company is pleased to have achieved the design 

battery grade specifications so early in the 

life of the Jiangsu plant. “Achieving pr oduct 

quality design at a complex chemical plant 

often takes considerable time and the Jiangsu 

team has worked hard to meet all of the lithium 

carbonate battery grade specifications so early 

in the ramp-up cycle. Only a few Chinese lithium 

carbonate plants are achieving battery 

grade specifications for lithium carbonate, notwithstanding 

the many years of development 

it took to achieve this quality. 

“The company is extremely pleased with the 

quality and operational performance of Jiangsu 

to date. Sample battery grade material is now 

being prepared for our major cathode of ftake 

customers, with technical grade demand and 

sales continuing. Revenue flows from Jiangsu 

will continue to increase as ramp-up in output 

progresses,” says Iggy Tan. 

Galaxy Resources’ new lithium carbonate plant at Jiangsu. Photo Galaxy Resources. 

The calciner (front end of the plant) feed 

rate is operating at 15 tonnes/hour compared 

with a design instantaneous rate of 18 tonnes/hour. 

The calcination and sulphation kilns 

are performing to expectation, with scope to 

further increase the feed rate. The leach section 

of the plant is operating according to design, 

recording strong rates of impurity 

removal (slag, iron, calcium and magnesium). 

The slag filtration and washing units appear 

to have sufficient capacity. The ion-exchange 

plant has successfully reduced calcium levels 

in the lithium sulphate mother liquor to meet 

battery grade specifications. 

The purification plant has been fully operational 

and is successfully pr oducing the low 

impurity final product required by the battery 

industry. The Jiangsu team is working to get 

improved back end stability and incr easing 

recovery as part of the ramp-up plan. 

The company has been able to sell all lithium 

carbonate product produced from the 

Jiangsu plant to date, with general acceptance 

of the product by customers. Production 

and r evenue flows will continue to 

increase as the ramp-up phase continues. 

Production commenced at the Aus$100 

million plant in April 2012, with ramp-up expected 

to take up to 12 months. The plant’s 

annual design capacity is 17,000 tonnes of 

battery grade (99.5%) lithium carbonate. 

江苏工厂生产电池级碳酸锂 

银河资源有限公司的全资子公司江苏碳酸锂 

工厂已经产出电池级碳酸锂 , 符合工厂设计 

目标。这意味着其产品不仅达到了 99.5% 的 

纯度 , 而且符合阴极制造商客户要求的杂质 

含量限值。电池级碳酸锂产品规格要求十分 

严格 , 如钙、镁、铁、硫酸盐和钠等杂质含 

量必须控制在一定水平。 

根据承销框架协议 , 为了进行质量测试 

与确认 , 样品材料已经递送给银河现有的客 

户 - 中国的 13 个主要电池阴极生产商和日本 

三菱公司。同时银河继续以坚挺的价格向技 

术级客户销售最终产品。 

电池级碳酸锂要求在更常见的技术级和工 

业级材料上存在显著的价格溢价。产品达到 

电池级是江苏工厂初期重要的里程碑。 

银河公司董事总经理 Iggy Tan 称 , 公司对 

江苏工厂可以在那么短的时间内生产出电池 

级产品表示非常高兴。“ 对于一个综合化工 

厂来说 , 要达到产品设计标准通常是十分耗 

时的 , 江苏团队为了在发展初期尽早产出电 

池级碳酸锂做出了大量的努力。尽管经过了 

多年的发展 , 目前仅有几家中国碳酸锂工厂 

能生产电池级碳酸锂。” 

Iggy Tan 称 ,“ 公司对于江苏工厂目前的品 

质和运营情况都十分满意。电池级材料样品 

已经为我们主要的阴极销售客户备好 , 技术 

级需求和销售仍在持续。江苏工厂的收益将 

继续增加我们初期的产量。” 

煅烧炉 ( 工厂前端 ) 给矿率为 15 吨 / 时 , 

设计的瞬时给矿率为 18 吨 / 时。煅烧炉和硫 

化炉性能正逐步达到预期 , 以便进一步提升 

给矿率。工厂的浸出部分也按照设计要求处 

在运行中 , 且杂质去除率较高 ( 炉渣、铁、 

钙和镁 )。炉渣过滤和清洗部分具有充足的 

处理能力。离子交换厂成功的去除了硫酸锂 

母液中的钙含量 , 达到电池级要求。 

提纯厂已经全面运营 , 并成功产出符合电 

池业要求的低杂质最终产品。作为发展初期 

计划的一部分 , 江苏团队正努力提高后端稳 

定性并提高回收率。 

江苏工厂目前生产的所有碳酸锂产品都不 

存在滞销问题。随着初期发展的延续 , 产量 

和收入都会继续提高。 

工厂产量在 2012 年 4 月已经达到 1 亿澳 

元 , 初期阶段预计共 12 个月。工厂的年设 

计产能是 1.7 万吨电池级碳酸锂 ( 纯度 

99.95%)。 


China 

SGX zones extended at depth and along strike 

DRILLING by Silvercorp Metals at the SGX 

mine in the Ying Mining District of Henan Province 

has significantly extended the mineralized 

zones to depth and along strike. It is 

expected that these results will expand the 

mineral resource reported in the r ecently 

completed NI 43-101 Technical Report for 

the Ying district. 

The underground drilling in the first 

half of 2012 at SGX has been focused 

on expanding the known r esource of 

major production veins S2, S7, S7-1 

and S8. Limited drilling was also conducted 

on veins S14, S14-1, S16W 

and their branch veins. 

In the six months to June 30 Silvercorp 

completed 22,121 metres in 62 holes 

using six underground drill rigs. Assay results 

for 66 holes, including 18 drilled in 

December 2011, were received with assays 

for the 14 holes ar e pending. Of 

these 66 holes, 31 had high-grade silverlead-zinc 

zones while the r emaining 

holes intersected vein structures. 

Drilling on the major production vein S2 was 

conducted primarily as infill drilling to upgrade 

the previously delineated resource blocks and 

has further defined the mineralized zones between 

the 100 metre and the zero metre elevations 

of the vein. Drilling on the other major 

production veins, S7, S7-1 and S8, was intended 

to test the downdip extension under the 

current production sections to expand the 

known resource of these veins. 

Six of the eight holes drilled on S7 intersected 

significant mineralization and have extended 

the mineralization zone to the -50 metr e 

elevation. Six of eight holes drilled on S8 defined 

the downdip extension of the mineralization 

which is now extended to the -50m 

Silvercorp Metals’ SGX mine is in the Ying Mining District in Henan Province. 

elevation in the north portion of the vein. Five 

of nine holes drilled on the vein S7-1 intersected 

high-grade mineralization and successfully 

extended the previously delineated high grade 

and wide mineralization zone fr om the 300 

metre elevation to the 100 metr e elevation 

over 300 metres along strike. All newly defined 

high-grade mineralization zones of these veins 

will be easily accessible via the ramp under 

construction at SGX and existing shafts. 

Limited drilling on veins S6, S14, S14-1 and 

S16W also showed that the mineralization of 

those veins further extends to depth. 

Drilling highlights: 2.20 metres of Vein S2 

@ 411 grams/tonne silver, 1.28% lead and 

6.02% zinc at the 76.81 metre elevation, including 

1.36 metres @ 639 grams/tonne silver, 

1.91% lead and 7.69% zinc; 1.28 

metres of Vein S6 @ 423 grams/tonne 

silver, 1.11% lead and 9.07% zinc at 

the 78.47 metre elevation, including 

0.5 metres @ 1014 grams/tonne silver, 

2.47% lead and 20.81% zinc; 

5.61 metres of V ein S28 @ 121 

grams/tonne silver, 2.03% lead and 

2.36% zinc at the 418.96 metr e elevation, 

including 0.67 metres @ 927 

grams/tonne silver, 12.45% lead and 

13.90% zinc; 3.70 metres of Vein S6 

@ 234 grams/tonne silver, 2.37% lead 

and 1.25% zinc at the 137.33 metr e 

elevation, including 0.56 metr es @ 

1387 grams/tonne silver, 13.91% lead 

and 6.23% zinc; 2.29 metr es of Vein S7 @ 

1043 grams/tonne silver, 3.35% lead and 

0.10% zinc at the 46.81 metre elevation, including 

1.25 metres @ 1551 grams/tonne 

silver, 5.27% lead and 0.11% zinc; and 

10.87 metres of V ein S7-1 @ 715 

grams/tonne silver, 6.85% lead and 1.52% 

zinc at the 209.58 metre elevation, including 

2.84 metres @ 1347 grams/tonne silver , 

13.52% lead and 2.16% zinc. 

SGX 区域沿走向和纵深方向延伸 

希尔威金属矿业公司位于河南省月亮沟采矿 

区的 SGX 矿区钻探工作已经沿纵深和走向将 

矿化区域显著扩大。这些钻探结成果预计将 

扩大月亮沟区域近期完成的 NI43-101 技术报 

告中的矿产资源量。 

SGX 于 2012 年上半年开展的地下钻探工作 

着重于扩大已知主要产矿脉 S2、S、S7-1 和 

S8。矿脉 S14、S14-1、S16W 及其分支矿 

脉也进行了有限的钻探。 

截至 6 月 30 日的 6 个月 , 希尔威动用 6 台地 

下钻机在 62 个孔位完成了 22,121 米的钻探 

工作。包括 2011 年 12 月的 18 个孔在内的 66 

个孔的分析结果已经收到 , 其余 14 个孔的 

分析结果还在等待中。在这 66 个孔中 , 有 

33 个孔具有高品位的银铅锌区域 , 余下的 

孔则是交叉脉状结构。 

在主产矿脉 S2 进行的钻探工作主要为加密 

钻探 , 用于提高此前勘探的资源矿体 , 并进 

一步确定该脉在 0 到 100m 海拔标高之间的矿 

化区域 ,S7、S7-1 和 S8 的钻探工作则旨在 

检测当前产矿区倾向延伸区域 , 以便提高这 

些矿脉的已知资源量。 

在 S7 实施的 8 个钻孔中有 6 个矿化明显 , 且 

矿化区域延伸至 -50 米海拔标高。S8 的 8 个钻 

孔中有 6 个确定矿化沿倾向的区域延伸至该矿 

脉北部 -50 米海拔标高。S7-1 的 9 个钻孔中有 5 

个发现了高品位矿化 , 并成功的将此前勘探 

的高品位厚矿化区域在 300 米的走向上从 300 

米海拔标高延伸至 100 米海拔标高。利用现有 

的竖井和 SGX 建设中的坡道 , 所有这些矿脉中 

新发现的高品位矿化区都将十分便利。 

在 S6、S14、S14-1 和 S16W 矿脉实施的有 

限的钻探作业也表明这些矿脉的矿化将沿纵 

深继续延伸。 

钻探亮点包括 :S2 矿脉在 76.81 米海拔标 

高有 2.20 米矿段银品位 411 克 / 吨 , 铅品位 

1.28% , 锌品位 6.02%, 其中包括 1.36 米银 

品位 639 克 / 吨 , 铅 1.91%, 锌 7.69% ; S6 

矿脉在 78.47 米海拔标高有 1.28 米矿段银 

品位 423 克 / 吨 , 铅品位 1.11% , 锌品位 

9.07%, 其中包括 0.5 米银品位 1014 克 / 吨 , 

铅 2.47%, 锌 20.81%; S28 矿脉在 418.96 

米海拔标高有 5.61 米矿段银品位 121 克 / 吨 , 

铅品位 2.03%, 锌品位 2.36%, 其中包括 

0.67 米银品位 927 克 / 吨 , 铅 12.45%, 锌 

13.90%;S6 矿脉在 137.33 米海拔标高有 3.70 

米矿段银品位 234 克 / 吨 , 铅品位 2.37%, 锌 

品位 1.25%, 其中包括 0.56 米银品位 1387 克 / 

吨 , 铅 13.91%, 锌 6.23%;S7 矿脉在 46.81 

米海拔标高有 2.29 米矿段银品位 1043 克 / 

吨 , 铅品位 3.35%, 锌品位 0.10%, 其中包 

括 1.25 米银品位 1551 克 / 吨 , 铅 5.27%, 锌 

0.11%; S7-1 矿脉在 209.58 米海拔标高 

有 10.87 米矿段银品位 715 克 / 吨 , 铅品位 

6.85%, 锌品位 1.52%, 其中包括 2.84 米银 

品位 1347 克 / 吨 , 铅 13.52%, 锌 2.16%。 


China 

Nova secures lithium supply agreements 

STRONG demand for lithium from Chinese battery 

manufacturers has resulted in US-based lithium 

supplier Nova Mining signing three supply 

agreements in one week during a recent visit to 

China. Nova’s CEO James Dilger secured deals 

with three major battery manufacturers - Shirui 

Battery Company, Asia Power International and 

Quiangquiang Battery Company. 

Nova has secured the lithium production of 

three mining licences in Mongolia and also has 

concessions in the South American country of 

Guyana and in the Canadian province of Saskatchewan. 

The operations in Mongolia, a 

major known exporter of lithium, are in Bayankhongor, 

Dornogobi and Dundgobi. 

Demand for lithium, which is used to make 

lithium batteries, seems destined to rise in 

China as the country moves forward on plans 

Lithium is in strong demand as sales of iPads, smartphones and tablets surge. 

Nova has a suite of lithium projects in Mongolia. 

to accelerate developments in energy storage. 

China has just 4% of the world’s installed 

advanced energy storage capacity but is 

making great strides to catch up. Lithium is a 

key factor in this endeavour. 

In January Hong Kong-listed BYD Company 

installed one of the world’ s largest 

battery storage systems in Hebei Province. 

The 36-megawatt-hour lithium-ion battery 

system, known as the Zhangbei pr oject, 

marks China’s first big move into the 

energy storage market. James Dilger describes 

efforts by Chinese companies to secure 

lithium supplies as ‘very aggr essive’ 

and says there is an ‘active seller’s market 

for lithium in China. 

After experiencing the active seller’s market, 

James Dilger made the decision to pursue 

multiple lithium supply arrangements. 

To provide maximum shareholder value, the 

focus has been to leverage the best possible 

positions for Nova, while taking advantage 

of the lithium supply crunch. 

He says, “Phenomenal Apple iPad sales, 

exploding smartphone manufacturing and 

multiple tablet brand manufacturing 

are openly credited with sparking 

this lithium shortage and prices 

have already tripled. 

It is no secr et that 

Chinese manufacturers 

would want 

to do everything in 

their power to support 

those manufacturing 

efforts by not running out of the 

main ingredient for long-life batteries for their 

electronics production industry.” 

The first supply agr eement secured in 

China was with Shenzhen-based Asia 

Power International, a major inter national 

manufacturer and supplier of lithium-ion 

batteries for the computing and 

smartphone industry. The second was with 

another Shenzhen-based operation, Shirui 

Battery Company, a major inter national 

manufacturer and supplier of lithium-ion 

batteries for electric vehicles, smartphones, 

computing tablets and cameras. The 

third agreement was with Quiangquiang 

Battery Company, also from Shenzhen, a 

manufacturer of lithium-ion batteries for 

smartphones, cameras, electric vehicles, 

and computing tablets. 

James Dilger’s negotiations in China also 

extended to include companies in Beijing. 

Nova seeks out the most potentially lucrative 

mining projects, supplies and sales of 

strategic high-demand minerals, such as lithium, 

as part of its aggr essive economic 

business model. 

Nova 矿业签订锂供应协议 

得益于中国电池制造商对锂的大量需求 , 位 

于美国的锂供应商 Nova 矿业在其近期对中 

国访问的一周内签署了三份供应协议。 

Nova 的首席执行官 James Delger 与三大电池 

制造商达成协议 , 包括时瑞电池有限公司、 

亚洲能源国际公司和强强电池公司。 

Nova 获得了蒙古的三个锂采矿权 , 并在 

南美洲圭亚那和加拿大萨斯喀彻温省也拥 

有矿权。位于蒙古的三个运营矿区分别位 

于巴彦洪戈尔省、东戈壁省和中戈壁省 , 

蒙古是一个重要的锂产国。 

中国在其计划加速能源储备的发展过程 

中对作为生产锂电池的主要原料 - 锂的需 

求似乎注定是要增长的。尽管中国仅有世 

界 4% 的能源储备量 , 但其正在大步赶 

上。而锂是这项工作中的关键因素。 

香港上市的比亚迪公司于 1 月份在河北 

省装配了世界上最大的电池储备系统。这 

个 36 兆瓦 / 时的锂离子电池系统 , 被称为 

张北项目 , 标志着中国步入能源储备市场 

的第一大步。James Dilger 认为中国公司 

对加强锂供应所做的努力 “ 非常激进 ”, 并 

称在中国锂具有 “ 活跃的卖方 ” 市场。 

在经历了活跃的卖方市场之后 ,James 

Dilger 决定寻求多份锂供应协议。为了最 

大程度的为股东创造价值 , 目前重点已经 

放在为 Nova 做出最有利的定位 , 并同时 

利用锂供应紧缩优势。 

他说 ,“ 苹果 iPad 的骄人销售业绩炒热了智 

能手机制造业 , 多家平板电脑厂家公开表示 

锂短缺现象会进一步出现 , 价格已经翻了三 

倍。毫无疑问 , 中国制造商会在保证电子制 

造业所使用的长寿命电池主要原料不短缺的 

情况下 , 全力支持这些制造业成果。” 

第一份在中国签订的供应协议是与深圳 

的亚洲能源国际公司达成的 , 这是一家国 

际级制造商 , 主要向计算机和智能手机业 

供应锂离子电池。第二份协议是与深圳的 

时瑞电池公司达成的 , 这是一家大型的国 

际制造企业 , 主要为电子交通设备、智能 

手机、电脑平板和相机提供锂离子电池。 

第三份协议是与同样位于深圳的强强电池 

公司达成的 , 这是一家为智能手机、相 

机、电子交通设备和计算机平板提供锂离 

电池的供应商。 

James Dilger 在中国还与北京的一些公 

司进行了商谈。Nova 寻求最具有潜在价 

值的矿产项目以及具有战略性的高需求矿 

物例如锂的供应和销售作为其激进型经济 

商业模型的组成部分。 


China 

New partnership to supply fluorite powder 

A SUBSIDIARY of China Shen Zhou Mining & 

Resources has formed a strategic partnership 

to supply processed fluorite powder to Ningxia 

Jinhe Chemical Co. Wuchuan Dongsheng Mining 

Company will supply Ningxia Jinhe with 

no less than 30,000 tonnes of processed fluorite 

powder annually. 

Ningxia Jinhe is one of the lar - 

gest dry process manufacturers of 

aluminum fluoride (AlF3) and Anhydrous 

Hydrogen Fluoride (AHF) 

in China with an annual production 

capacity of 110,000 tonnes of aluminum 

fluoride and 24,000 tonnes 

of AHF. Ningxia Jinhe’s high-quality 

aluminum fluoride pr oducts 

meet international standards. 

Based in Zunyi City, Guizhou Province, 

Wuchuan Mining is the largest 

fluorite mining processing company 

in southeast China. Within the mine 

in Zunyi, there are also by-product 

deposits of barite. China Shen Zhou 

acquired 60% of the equity inter 

ests of 

Wuchuan Dongsheng Mining in January 2012. 

China Shen Zhou’s chairperson and chief 

executive officer Xiaojing Y u says, “W e are 

pleased with this strategic new business win 

for our Wuchuan subsidiary. Ningxia Jinhe’s 

aluminum fluoride products have an excellent 

reputation in China for high quality . Securing 

such a reputable customer like Jinhe will pr o- 

vide an ongoing stable supply channel for 

Wuchuan’s fluorite products and pave the way 

for further development of its barite resources. 

“Our long term plan is to expand Wuchuan’s 

capabilities in the highly pr ofitable barite market, 

capitalizing on proprietary processes already 

developed. As we continue to work with 

China Shen Zhou Mining has various fluorite, barite and non-ferrous 

metal projects throughout China. 

more downstream fluoride manufacturers, we 

will establish Wuchuan as the largest fluoritebarite 

deep processing centre,” she says. 

Barium sulphate precipitate is a nearly 100% 

pure barium sulphate product resulting from a 

barite separation and purification process. Barium 

sulphate precipitate is widely used in many 

applications including paints and coatings, plastics, 

rubber, fibre and ink, among others. 

China Shen Zhou Mining & Resour ces, 

through its subsidiaries, is engaged in the exploration, 

development, mining, and processing 

of fluorite, barite and nonferrous metals 

such as zinc, lead and copper in China. The 

company has the following principal areas of 

interest: fluorite extraction and processing in 

the Sumochaganaobao region of Inner 

Mongolia; fluorite and barite extraction 

and processing in Wuchuan County of 

Guizhou province; fluorite and barite extraction 

and processing in Yanhe County 

of Guizhou province; fluorite extraction 

and processing in Jingde County, Anhui 

Province; zinc/copper/lead processing 

in Wulatehouqi of Inner Mongolia; and 

zinc/copper exploration, mining and 

processing in Xinjiang. 

Meanwhile, the company’s subsidiary, 

Xinyi Fluorite Company, is among the 

first group of fluorite companies whose 

production lines meet government standards. 

Based in Anhui Pr ovince, Xinyi’s 

production line was one of the 10 pr o- 

duction lines meeting standards established 

by the Ministry of Industry and Information 

Technology (MIIT) of China. 

Xiaojing Yu says, “Fluorite’s importance as 

a key industrial raw material has been recognized 

by the highest gover nment authorities 

in China including the State Council. MITT 

began its public inspection of fluorite companies 

early this year. We welcome government 

initiatives in consolidating the industry.” 

建立供应萤石粉的新合作关系 

中国神舟矿业资源股份有限公司的子公司已 

经与宁夏金和化工公司建立战略合作关系来 

向后者提供加工萤石粉。务川东升矿业公司 

每年将向宁夏金和提供至少 3 万吨加工萤石 

粉。 

宁夏金和是中国最大的氟化铝 (AlF3) 

和无水氟化氢 (AHF) 干法加工厂之一 , 其 

年产能为 11 万吨氟化铝和 2.4 万吨无水氟化 

氢。宁夏金和的高品质氟化铝产品达到了国 

际标准。 

位于贵州遵义市的务川矿业公司是中国东 

南部最大的萤石开采加工公司。在其位于遵 

义的矿区中还存在伴生重晶石矿床。中国神 

州在 2012 年 1 月收购了务川东升矿业 60% 的 

股权。 

中国神舟的董事长兼首席执行官于晓静 

说 ,“ 我们很高兴能为务川分公司赢得新的 

战略业务。宁夏金和的氟化铝产品因其较高 

的品质而享誉全中国。能够保留像金和这样 

有声望的客户将会为务川的萤石产品提供持 

续稳定的供应渠道 , 并为今后重晶石资源的 

发展铺平道路。” 

她表示 ,“ 我们的长期计划是利用专有 

工艺 , 提高务川在高收益的重晶石市场的产 

能。在我们继续与下游萤石生产商合作的过 

程中 , 我们将把务川建立成最大的萤石 - 重 

晶石深度加工中心。” 

重晶石分离和提纯过程中得到的硫酸钡沉 

淀近乎是 100% 纯度的硫酸钡产品。硫酸钡 

沉淀被广泛的用于涂料、塑料、橡胶、纤维 

和油墨等领域。 

中国神州矿业资源公司 , 通过其子公司在 

中国涉足萤石、重晶石和有色金属如锌、铅 

和铜的勘探、开发、开采及加工产业。该公 

司主要的权益地区范围包括 : 内蒙古苏莫查 

干敖包地区萤石提取与加工 ; 贵州省务川县 

萤石和重晶石提取与加工 ; 贵州省沿河县萤 

石和重晶石提取与加工 ; 安徽省旌德县萤石 

提取与加工 ; 内蒙古乌拉特后旗锌 / 铜 / 铅加 

工 ; 以及新疆的锌 / 铜勘探、开采与加工。 

同时 , 该公司的分公司 - 新义萤石矿有限 

公司是第一批生产线达到政府标准的萤石 

公司。新义位于安徽省旌德县 , 其生产线 

是满足中国工业和信息化部 (MIIT) 制定 

的标准的十条生产线之一。中国神州及其 

萤石相关的子公司将为将来的检查工作与 

相关政府机关全面合作。 

于晓静称 ,“ 萤石作为关键工业原材料的 

重要性已经得到包括国务院在内的中国最 

高政府机关的认可。工业与信息化部于今 

年早些时候开始公开检查萤石企业。我们 

对政府开始对该产业进行整顿表示非常支 

持 , 我们也很有信心我们的分公司将会通 

过未来的审查。随着门槛不断提高 , 我们 

将定位于引领萤石产业 , 并利用未来发展 

机会。” 


Indonesia 

Uncertainty for Indonesia’s mining services industry 

Contributed by Holman Fenwick Willan LLP (hfw) 

THE deadline of September 30 for mining 

companies to adjust existing mining contracts 

and to self-conduct the activity of exploitation 

is looming large. However, it is still 

unclear whether the Indonesian Government 

will change its standpoint or, if it does not, 

how it will respond to any non-compliance. 

This has led to great uncertainty in the future 

of Indonesia’s mining services industry. 

Overview 

Indonesia’s Law No 4 of 2009 on Minerals 

and Coal Mining dated January 12, 2009 (the 

Mining Law) has made significant changes to 

the mining industry, one of which is the pr o- 

vision of mining services in Indonesia. The 

Regulation of the Minister of Energy and Mineral 

Resources No 28 of 2009 regarding the 

Conduct of Mineral and Coal Mining Services 

Business and the Regulation of the Dir ector 

General of Mineral, Coal and Geothermal No 

376.K/30/DJB/2010 were issued to further 

implement the mining services pr ovision 

under the Mining Law. 

In a nutshell: 

• The scope of work that can be contracted 

out by the holder of a Mining Business 

Permit (IUP) is now limited, where the core 

mining activities (exploitation, processing 

and refining) have been excluded. 

• The IUP holder must conduct a pr oper 

tender process and prioritize local or national 

mining services providers. It can engage 

foreign-owned mining services 

providers only if there are no suitable local 

or national providers. 

• The IUP holder must satisfy certain processes 

and conditions before the Minister 

of Energy and Mineral Resour ces 

will grant approval for the engagement 

of its affiliate. 

• Even though both the IUP holders and mining 

services providers are facing a potential 

sanction of licence revocation if they fail to 

comply with the requirements when the September 

30 deadline arrives, at this stage it is 

still unclear how the Indonesian Government 

will react and what the ramifications will be. 

What services can be contracted out 

The Mining Law and Minister Regulation No 

28 of 2009 provide that mining services providers 

can provide: 

• Consultation, planning and testing of 

equipment in the fields of mining or pr o- 

cessing and refining; 

• Consultation, planning, execution and testing 

of equipment in the fields of general 

survey, exploration, feasibility studies, mining 

construction, transportation, mining 

environment, post-mining, r eclamations 

and occupational health and safety; 

• Limited exploitation activity as follows: 

(i) Stripping of overburden – which includes 

stripping, loading and r emoval of 

overburden and managing explosives for 

this purpose; and 

(ii) Transportation of minerals or coal, 

This is provided that the IUP holder will remain 

to assume the r esponsibility for mining 

services performed by mining 

services providers. This means that the 

IUP holder must self-conduct the activities 

of exploitation (with limited exceptions as 

mentioned above), processing and refining 

itself (it cannot contract them out). 

Who can provide mining services 

The IUP holder is required to conduct a tender 

process by making a mass media announcement 

at local or national level. The IUP holder 

must prioritize local or national mining services 

providers (ie wholly Indonesian owned) and is 

allowed to engage foreign-owned mining services 

providers only if the tender result shows 

that no local or national mining services providers 

are financially and technically capable to 

perform the required services. 

Additionally, under Director General Regulation 

No 376 of 2010, an IUP holder cannot engage 

its subsidiary or af filiates in the field of 

mining services within the mining ar eas that it 

commercializes, unless it has obtained an approval 

from the Minister. The Minister will grant 

its approval on the following conditions: 

• The plan to procure mining services has 

been made twice in a mass media announcement 

at local and/or national level 

and the tender process fails as either: 

(i) No similar mining services pr ovider is 

available within the relevant areas; or 

(ii) No mining services provider satisfies the 

requirements to have suf ficient working 

capital, investment and competent workforce; 

and 

• The IUP holder submits an application to 

obtain the approval from the Minister to engage 

its affiliate in mining services, together 

with the required supporting documents. 

What about existing mining services arrangements 

Minister Regulation No 28 of 2009 grandfathers 

existing mining services arrangements in 

place at the time of issuance (September 30, 

2009) for three years. This means that holders 

of IUPs (and Contracts of W ork) must 

adjust their existing arrangements by September 

30, 2012. In addition, Minister Regulation 

No 28 of 2009 also r equires mining 

services providers to carry out their activities 

within the allowed scope of work. These demonstrate 

that the obligations to adjust the 

existing arrangements and comply with the 

Mining Law and Minister Regulation No 28 of 

2009 are imposed equally on both the holders 

of IUPs and mining services providers. 

Minister Regulation No 28 of 2009 pr ovides 

administrative sanctions (which also include revocation 

of mining services licence) for mining 

services providers that carry out their activities 

not in accordance with their mining services licence 

and outside the allowed scope of work. 

There is no clear cut sanction under Minister 

Regulation No 28 of 2009 on the IUP holders 

for failing to adjust their existing arrangements. 

However, the Mining Law provides that the issuer 

of an IUP can revoke an IUP if the holder 

does not comply with the obligations set forth 

under the laws and regulations (which include 

Minister Regulation No 28 of 2009). 

What to do 

If the Indonesian Government’s point of view 

does not change when the deadline arrives, 

one or more of the following may be worth 

considering: 

• Amendment of the existing mining ser - 

vices contract; 

• Acquisition of company holding IUP. 

• Spin-off and transfer of heavy equipment 

used for exploitation activity; 

• Lease arrangement; or 

• Financing arrangement. 

hfw recommends obtaining a pr oper tax 

advice on the implication on each structur e 

before making any decision. 

Contact Brian Gordon, Partner (+65 6305 9533 or 

brian.gordon@hfw.com) or James Donoghue, Partner 

(+61 8 9422 4705 or james.donoghue@hfw.com ) 


Indonesia 

Padang to focus on Paser project 

PADANG Resources has completed its due diligence program on the 

Paser Coal Project in East Kalimantan and is now pr oceeding with 

design and implementation of a drilling program to define a mineable 

resource. The successful due diligence has prompted Padang to fully 

focus on Paser and not to pr oceed with the West Papua and West 

Sumatra (Lumpo) coal projects. 

The due diligence was undertaken after securing drill core and data 

from a 20 borehole program. Data from previous exploration included 

independent coal quality analysis which assisted in determining the 

vertical and lateral distribution of the coal seams and coal quality. This 

data was combined with data from a resistivity survey. 

Padang Resources’ Paser Coal Project is in South Kalimantan, just 130km from Balikpapan. 

The company has also verified a number of permits necessary to 

commence mining coal from the Paser project. The company’s incountry 

manager made significant progress in validating permits and 

environmental approvals required, including the UKL/UPL permit from 

the Environmental Impact Control Agency. The permit area has been 

confirmed by the Forestry Services Department of Mining and Energy 

to be within an ‘Other Utilities Area’ and not in a ‘Production Forest’ 

or ‘Protected Forest’ zone. Coal mining from the permit area is therefore 

approved from the permit area. 

The IUP holder has also confirmed a valid agr eement with the 

owners of the network of r oads within the permit and dir ectly from 

the permit area to the jetty. It has confirmed possession of a permit 

awarded by the Bupati Pasir to use the jetty on the Apar River about 

14km from the permit for the purpose of loading coal onto barges. 

In April Padang acquired a 70% stake in Paser Pty Ltd which had 

entered into an MoU with PT Gunung Mentari Mining for a 100% joint 

venture interest in Paser. The 43 hectare project is in the Batu Engau 

district near Petangis village in Paser Regency, about 130km southwest 

of Balikpapan. There are good quality haul roads and jetty locations 

within the area while a deep water harbour is 14km away. Coal 

analysis data from nine samples indicate an average calorific value of 

6841 kcal/kg with overall ash, moistur e and sulphur contents comparable 

with typical Indonesian bituminous coal. 

An independent report for Padang on the interpretation of the geological 

data from the project identifies 3 potential coal seams with a relative 

north-south pattern of strike and thicknesses varying fr om 0.4 to 3.4 

metres. Seam 1 has a potential thickness of 1.1 metr es with the strike 

direction of 840 metres, seam 2 has a potential thickness of 0.5 metres 

with the strike direction of 1160 metres, and seam 3 has a potential 

thickness of 3.4 metres with the strike direction of 940 metres. 


Indonesia 

Exalt to enter coal industry 

EXALT Resources has signed an agreement 

to acquire Odni Holdings, a Singapore incorporated 

coal investment company with an interest 

in a number of coal pr ospects in 

Indonesia. ASX-listed Exalt aims to build a 

substantial and diverse portfolio of Indonesian 

coal assets encompassing a variety of 

projects from early stage exploration to pr o- 

ducing coal assets with a range of coal types, 

spread across multiple Indonesian geographies, 

and close to potential transport routes 

and existing or planned infrastructure. 

Completion of the sale and pur chase 

agreement is conditional upon due diligence, 

shareholder approval, capital raising of at 

least $10 million and receipt of all approvals. 

The acquisition will provide Exalt with the 

ability to investigate and, if initial exploratory 

results are satisfactory, to acquire all of, or an 

equity interest in, a number of pr ospective 

coal mining projects in the Kalimantan, Sumatra 

and West Papua regions of Indonesia. 

Exalt Resources proposed purchase will include the Sugico project of about 250,000 hectares in South Sumatra. 

The initial projects include a very large exploration 

area in South Sumatra, the Sugico 

project, spread over 11 concessions and covering 

about 250,000 hectares with the potential 

for a large resource. Exalt will acquire 

the rights to purchase two concessions areas 

in East Kalimantan, Project BIG and Project 

MMBP, and one in Central Kalimantan, Pr o- 

ject KARIN, over known coal formations. In 

addition, Exalt has started due diligence on a 

producing asset, Project Damanka in East 

Kalimantan, near one of the world’ s largest 

coal mines. It is also looking at two concessions 

in different areas of West Papua. 

In addition to the initial projects, the proposed 

acquisition of Odni will also provide Exalt 

with a compelling pipeline of gr eenfield, 

brownfield and producing projects with the 

aim of building a substantial diverse portfolio 

of Indonesian coal assets. 

Exalt has engaged Corpac Partners to assist 

with development of in-country relationships, 

the identification and development of an 

asset pipeline, strategic advice and various 

Indonesian-based support services. 

The signing of the agreement follows the recent 

appointment of leading senior coal executive 

Barry T udor as CEO and managing 

director of Exalt. 

Partners to focus on three UCG prospects 

FOLLOWING evaluations over r ecent 

months, Cougar Energy and its Indonesian 

partner PT Medco Energi Mining Inter nasional 

have focused in on three prospective underground 

coal gasification (UCG) pr oject 

areas – two in Kalimantan and one in Sumatra. 

Other opportunities in the country continue 

to be brought to the partners, who are in 

the process of preparing formal agreements 

for progressing the existing opportunities. 

MedcoEnergi, based in Jakarta, is a subsidiary 

of PT Medco Energi Internasional Tbk, a publicly-listed 

company with a range of energy interests 

including domestic and international oil and 

gas operations, power generation and the development 

of downstream industries. Medco- 

Energi shares with Cougar Energy the goal of 

bringing the UCG industry into the mainstream 

of energy supply in Indonesia. 

Both MedcoEnergi and Cougar see an immediate 

need for the provision of cheap and clean 

sources of power in Indonesia using local coal 

resources, which would potentially supplement 

MedcoEnergi affiliate’s current power generation 

capacity of ar ound 200MW. The companies 

have already identified target coal resources and 

plan to progress the MOU goals rapidly. 

The immediate focus for ASX-listed Cougar 

is to bring its UCG project strategy in Asia to 

realization in the target countries of China, 

Mongolia and Indonesia. Negotiations continue 

with local partners in each country to 

gain access to coal leases identified to develop 

potential Underground Coal Gasification 

projects for the generation of electricity. 

Cougar has recently entered into a revised 

agreement with its UCG technical partner Ergo 

Exergy Technologies for the use of Ergo’s UCG 

technology. Ergo, based in Montreal, Canada, 

has a long and proven track record in applying 

its technology to UCG projects across the Western 

world. In addition to operating the first 

successful UCG demonstration pilot plant at 

Chinchilla in Queensland from 1999 to 2002, 

and the ignition at Kingar oy in March 2010, 

Ergo has managed the ignition and expansion 

of the pilot demonstration plant operated since 

January 2007 by Eskom, the South African 

Government utility company. 

More recently Solid Energy, a major New 

Zealand Government-owned energy company, 

announced the successful ignition and 

syngas production from its $22 million UCG 

pilot plant near Huntly on the North Island 

using Ergo’s technology. The purpose of the 

plant is to give Solid Energy the geological, 

process and environmental data to assist in 

commercial UCG plant design. 

Cougar’s Board has recently appointed Rob 

Neill as CEO and managing director. 


Indonesia 

BBM resource up 17 million tonnes 

COKAL has increased the total resource estimate by 17 million tonnes 

at its Bumi Barito Mineral (BBM) coal project in Central Kalimantan. The 

additional estimate consists of an indicated 7 million tonnes and an inferred 

10 million tonnes of coal r ecently discovered in the ‘J’ seam at 

the project. The overall quality is 70% coking coal and 30% PCI. 

“The increase is 100% premium coking coal which confirms our 

view that the coal quality of the BBM project continues to develop as 

a primarily coking coal project as we progress towards the east,” says 

Cokal executive director Pat Hanna. He says drilling is continuing to 

define further coal resources which are generally in areas of low strip 

ratio and with higher percentages of coking coal. 

Cokal’s coal tenements are in Kalimantan with the BBM project being the most advanced. 

The ‘J’ seam is the uppermost of nine seams identified at the 19,920 

hectare project which is adjacent to BHP Billiton’s Juloi tenement along 

the Barito River and has numer ous outcrops of bright coal. This new 

seam overlies three others which were used to estimate the JORC-compliant 

inferred coal resource last year. Cokal’s managing director Jim 

Middleton says the ‘J’ seam exhibits the same remarkable coking features 

as the ‘B’, ‘C’ and ‘D’ seams. “The coal has very attractive attributes 

being very low in impurities while containing the right essential 

metallurgical attributes sought by Asian steel makers. “The low in situ 

ash content indicates there is a reasonable opportunity that a direct ship 

style operation can be developed, avoiding the need to construct a coal 

washing plant which would involve significant time and capital,” he said. 

Cokal has estimated the total exploration target fr om at least 13 

seams at the Eastern block of BBM at between 200-350 million tonnes, 

based on coal occurrences less than 200 metres deep. 

The company is progressing with plans to take BBM into pr oduction 

as soon as possible, with an initial annual start-up target of 1-2 million 

tonnes. Cokal is also advancing its feasibility and environmental studies 

necessary to obtain mining appr ovals. Another Cokal tenement, BBP, 

covering 13,050 hectares, is adjacent to BHP Billiton’ s Maruwai tenement. 

In other news, the company has announced it holds the majority 

share and operational control in five Indonesian projects. Cokal purchased 

its shares in five Indonesian companies which own the projects, then 

applied to have the holding companies converted to Penenaman Modal 

Asing (PMA) companies which can legally have 100% foreign ownership. 


Indonesia 

First gold poured at Martabe project 

G-RESOURCES Group completed its first 

gold pour at the Martabe Gold-Silver Project 

in North Sumatra on Tuesday, July 24. The 

company is now continuing to ramp-up to full 

annual production of 250,000 ounces of gold 

and 2.5 million ounces of silver, and expects 

this to be achieved by the end of 2012. 

The start of pr oduction at G-Resour ces 

core asset marks a significant milestone for 

the Hong Kong-based, Asia-focused mining 

corporation. The company’s employees and 

contractors have worked for 3 years to 

G-Resources creates its first gold and silver dore bar at the 

Martabe mine in North Sumatra on July 24, 2012. 

achieve first gold with the support of the Indonesian 

Government and communities living 

near the mine. 

Commenting on the first gold pour in the 

Martabe mine gold room, G-Resources chief 

executive officer Peter Albert said: “Now that 

we have secured first gold, we ar e on track 

to complete commissioning activities and 

ramp production up to full capacity over the 

coming months. At capacity of 250,000 ounces 

per annum of gold and 2.5 million ounces 

per annum of silver, this will be one of the largest 

gold mines in Indonesia and Asia. And 

we are coming on stream at a time when the 

gold market continues to strengthen. 

“First gold marks a gr eat achievement for 

all of our employees, our contractors and all 

of the people of North Sumatra, especially 

those in the surr ounding communities. We 

thank everybody for their gr eat support,” 

Peter Albert added. G-Resources chairman 

Chiu Tao and vice-chairmen Owen Hegarty 

and Raymond Or wer e also on site for the 

first gold pour. Looking ahead, G-Resources 

highlighted plans to look at expansion 

through adding to existing resources and reserves 

at the present Martabe deposits and 

stepping up exploration efforts on the large 

and highly pr ospective Contract of W ork 

area. Martabe has a r esource base of 7.86 

million ounces of gold and 73.48 million ounces 

of silver with open pit pr oduction beginning 

at the Purnama deposit. 

The production milestone has also coincided 

with the acceleration of mining activities 

with 440,000 tonnes of ore stockpiled at the 

end of the second quarter and plant operators 

beginning to work in shifts in or der to 

provide 24 hours of coverage. 

Exploration continues to show strong gold 

and silver results at both the Tor Uluala and 

Purnama deposits. It is continuing at and adjacent 

to the mining area as well as in nearby 

deposits and at prospects throughout the tenement 

area. Martabe is on the western side 

of the island of Sumatra in the Pr ovince of 

North Sumatra, in the Batangtoru sub-district. 

The project is established under a sixth 

generation Contract of W ork (COW) which 

was signed in April 1997. 


Indonesia 

Western Manganese considers additional tenements 

WESTERN Manganese continues to focus on 

securing additional manganese and coal tenements 

of strategic importance in Indonesia 

in order to expand the land ar ea currently 

held. Several of the manganese tenements 

that were studied previously in West Timor 

are currently being discussed with tenement 

owners while the company has also been actively 

looking at acquisition opportunities in 

coal in Kalimantan and Sumatra. 

Company management feels that the current 

uncertainty in commodity prices and proposed 

amendments to Indonesian mining laws regarding 

mineral exports are creating opportunities 

to acquire quality assets under r easonable 

terms. The company has r e-analyzed all previous 

manganese opportunities and is exploring 

several potential acquisitions. 

In addition to tenements pr eviously studied, 

the team has become particularly inter ested in 

an artisanal mining area covering about 20,000 

hectares in West Timor. Although the area is not 

yet licensed as an exploration ar ea, the local 

land owners have approached the company to 

jointly apply for an exploration licence. This joint 

cooperation between local communities and the 

company is a result of Western Manganese’s 

extensive community awareness and socialization 

programs. It is currently evaluating the best 

course of action to apply for the tenements. 

The company has re-analyzed all previous manganese 

opportunities and is exploring several potential acquisitions. 

The company holds the rights to two promising 

manganese exploration tenements near 

Atembua in West Timor, an area regarded as 

an emerging manganese province. The two tenements 

cover 4258 hectares and both are within 

30km of Atapupu harbour. 

It also holds an option to acquir e 51% of 

the Genesis Manganese Project on Sulawesi 

and is continuing a community relations campaign. 

The company has r ecently received 

confirmation of ‘Clean and Clear’ status from 

the Ministry of Energy and Mineral Resources 

(MEMR). The designation provides assurance 

that the validity of the tenement and production 

licence has been scrutinized by MEMR, 

who have determined that they do not overlap 

other tenements or licences. 

One of the objectives of the company is to 

also acquire interests in non-manganese projects 

and it has been looking at acquisition opportunities 

in coal with management believing 

current market conditions have fostered a highly 

advantageous scenario for acquiring tenements. 

During the second quarter Western Manganese 

was offered 28 coal tenements for r eview and 

has chosen to further review 11 of these. 

Opportunities range fr om greenfields tenements 

to currently producing mines with further 

exploration potential. It is r eviewing five tenements 

in East Kalimantan with potential for high 

calorific value (CV) coal and four with mid CV 

coal potential, and another two tenements in 

Sumatra with high CV coal potential. 


Philippines 

Acoje tank leaching BFS nears completion 

THE bankable feasibility study (BFS) for ENK’s 

Acoje tank leaching nickel pr oject is nearing 

completion. Much of the test work is complete 

and the BFS, which is being undertaken by Jacobs 

Engineering of Perth, Western Australia, 

is in the economic evaluation and write-up 

stage. Following release which is expected in 

September, ENK intends to enter into a strategic 

partnership with an offtake partner to fund 

the project with minimal shareholder dilution. 

The detailed test work and design programs 

on the leaching and solid liquid separation are 

now with Jacobs for final costing and write up, 

as is the comminution cir cuit, continuous ion 

exchange design and infrastructure details. 

ENK plans to run a parallel costing exer cise 

with Chinese engineering firms that will more likely 

and realistically estimate costs for construction 

in the Philippines. Based on its experience 

in dealing with Chinese construction firms at 

Caldag in Turkey and more recently Acoje, the 

company believes there are significant savings 

to be found utilizing Asian-based contractors. 

Offtake discussions are proceeding well and 

are expected to progress to a conclusion as 

key components of the BFS are completed. As 

part of the process the company has sent a 

number of detailed analysis reports on the Nikkel 

Hydroxide Product (NHP) to potential of f- 

DSO nickel stockpiled at port facilities near ENK’s Acoje Nickel 

Project. Mining at Acoje has been discontinued as the site is 

prepared for construction of the tank leach processing plant. 

take partners. The NHP is a significantly more 

advanced product than the Mixed Hydr oxide 

Product (MHP) that was proposed to be produced 

at Caldag and r equires little to no r efining 

for final application. ENK believes NHP will 

be highly sought after by end users. 

Public meetings on the amendments to the 

existing Environmental Clearance Certificate 

(‘ECC’) have been undertaken without any significant 

concerns. The amendment document 

is in final stages and will be submitted to the 

Environment Management Bureau. 

Subject to successful completion of the BFS 

the company intends to pr oceed to financing 

of the construction of the processing plant utilizing 

a combination of bank debt and equity. It 

is proposed to utilize funding fr om a strategic 

offtake partner to minimize the equity funding 

required and reduce dilution for shareholders. 

The Acoje heap leach trial, which started on 

April 16, 2011, has entered the next phase in 

the heap leach cycle, which is the rinsing of 

the heap with water to displace any in-situ 

pregnant leach solution. The heap rinsing is 

expected to take a few months befor e the 

heap outflow meets applicable standar ds. 

Once the heap has been rinsed rehabilitation 

will commence. As was observed with the 

column leach tests, nickel extraction has increased 

after the heap was drained and with 

commencement of rinsing. 


Philippines 

MINDORO Resources has signed an 

agreement with Canadian TSX-listed company 

and Philippines-based mine and processing 

plant operator, TVI Pacific for a 

strategic private placement of Can$3.155 

million in Mindoro as well as proposed joint 

ventures to fund the Agata Nickel Pr oject 

to direct shipping or e (DSO) pr oduction 

and complete a nickel pr ocessing project 

definitive feasibility study (DFS). TVI will 

also have the option to form a joint venture 

over Mindoro’s Pan de Azucar sulphide 

project within 12 months. 

The agreement provides for TVI to advance 

a bridging loan of Can$968,969 to be 

secured by Mindoro’s interests in the Agata 

South nickel laterite mineral pr oject in the 

southern part of the Agata Mineral Production 

Sharing Agreement (MPSA). Subject to 

due diligence, TVI will also subscribe for 

more than 63 million common shar es of 

Mindoro by way of private placement for 

total consideration of Can$3,155,778. 

TVI will have the exclusive right to form 

two joint ventur es relating to Mindor o’s 

TVI agrees to investment in Mindoro 

Agata Nickel Project, comprising the Agata 

MPSA and exploration permits north and 

south of the Agata MPSA but excluding tenements 

at Tapian San Francisco that are 

the subject of another Mindoro transaction 

with Red Mountain Mining. 

With the Agata DSO Joint Venture (ADJV) 

TVI will commit to 100% of expenditure to 

establish a DSO operation with the intention 

of generating early cash flow for the 

DSO JV. Once the pr oject starts a DSO 

operation, TVI will ear n a 60% interest in 

ADJV, subject to TVI having spent at least 

Can$2 million within 12 months and achieving 

DSO operation within thr ee years of 

entering the JV agreement. 

With the Agata Processing Joint Venture 

(APJV) TVI will commit to 100% of expenditure 

to complete a DFS on nickel processing 

for the Stage 2 Agata Nickel Pr oject. 

Upon delivery of the DFS, including pilotscale 

metallurgical testing, third-party engineering 

studies and documentation, TVI 

will earn a 60% interest in the APJV, subject 

to TVI having spent a minimum of 

Can$2 million within 12 months and completing 

the DFS within four years of entering 

the JV agreement. 

TVI also has an exclusive option to form 

a joint venture on Pan de Azucar within 12 

months of the agreement, renewable for a 

further 12 months for payment to Mindoro 

of Can$200,000. Terms and conditions include 

US$2 million to ear n 51% then an 

option to spend another US$3 million to 

earn an additional 9%. In the event a pr o- 

posed sale of Mindoro’s Tapian San Francisco 

Project to Red Mountain Mining does 

not proceed, the agreement provides that 

TVI will have an exclusive option to form a 

joint venture with Mindoro. 

Mindoro’s president and CEO Jon Dugdale 

says, “We are very pleased with the 

planned strategic investment from TVI Pacific, 

and the pr oposed joint ventur es, 

which optimize the opportunity for Mindoro 

to achieve DSO cashflow production in the 

near term, as well as maintain a substantial 

stake in a potential major processing project 

down the track.” 


Philippines 

Astra secures Chinese buyer for iron ore 

ASTRA Resources has signed a letter of intent 

with Kunming Gongxin Trading (KGT) for 

the Chinese company to pur chase 600,000 

tonnes of ir on ore from Astra’s Babuyan 

Channel iron sand project in northeast Luzon. 

An offtake agreement will be signed once 

KGT has received confirmation of the grade 

of iron ore within the project area, and outlines 

KGT’s intent to buy 50,000 tonnes of iron 

ore each month for the next year. 

Astra chief executive of ficer Dr Jaydeep 

Biswas says, “As soon as full operation 

starts, which is slated for the end of 2012, an 

offtake agreement will be pr epared and signed 

between a special purpose vehicle 

owned by Astra and KGT.” 

The Babuyan Channel iron sand lode is in the 

province of Cagayan and is estimated to contain 

more than 31.3 billion tonnes in the Mineral 

Production Sharing Agreement Areas (MPSA). 

Phase 1 of Astra’s mining tenement holds only 

a fraction of the lode. Astra will commence 

works on the first phase of the project once an 

agreement is signed between its joint ventur e 

(JV) entity, Cagayan River Astra Philippines, 

and the Cagayan provincial government. 

Astra’s managing director Silvana De Cianni 

says the agr eement will confirm the 

joint venture’s authority to dredge, mine, extract 

and utilize ‘quarry r esources’, sand 

particles and other materials such as magnetite 

iron sands from the Cagayan River 

Delta. “The authority to dredge the assigned 

area, a 200 metre by 12km strip along the 

mouth of the Cagayan River, is stipulated to 

be for a period of 25 years, with annual production 

expected to r each gross sales of 

about 1 million tonnes by 2014.” 

The initial estimated resource is 135 million 

tonnes, however Astra is negotiating the acquisition 

of additional mining ar eas alongside 

MPSA 1, 2, 3 and 4 to add to the JV. “It is expected 

that this business partnership will significantly 

enhance the Economic Development 

Program of the mining industry sector in the 

Philippines,” Silvana De Cianni says. 

Astra Resources’ global portfolio includes 

gold interests in South East Asia, coal mine 

in Africa, iron ore in India, Norway and the 

Philippines, carbon efficient and commodity 

businesses, the pr oduction of the highstrength 

T-Steel technology in Hungary, clean 

coal technology and the pr ovision of mining 

services housing in Rockhampton, Queensland 

and a large agricultural focus on creating 

Australia as the food bowl for the Asian r e- 

gion through Astra Agricultural Resources. 

Indicated resources up 16% at Co-O 

ONGOING drilling at Medusa Mining’s Co-O 

Gold Project has resulted in a 16% increase in 

indicated resources. As at July 1, 2012, There 

are now 1.89 million indicated tonnes @ 11.8 

grams/tonne gold for 715,000 ounces, up 

from 616,000 ounces @ 12.00 grams/tonne 

gold at June 30, 2011. Co-O now boasts in - 

ferred resources of 4.325 million tonnes @ 9.4 

grams/tonne for 1.304 million ounces. The 

total resource of 2.019 million ounces @ 10.1 

grams/tonne compares to the total of 1.96 million 

ounces at the end of the 2011 financial 

year and takes into account the 60,595 ounces 

of gold produced in the 12 months. 

In line with the mine expansion at Co-O, the 

drilling during the past 12 months has focused 

on infilling to increase confidence levels in key 

mining areas as well as step-out drilling along 

strike and at depth to demonstrate the excellent 

upside of the deposit. While the strike 

length has been increased by 400 metres to 

2000 metres, and is still open in all dir ections 

continuing to demonstrate excellent potential 

to add more resources in future years, many 

drill intersections undertaken in the drilling 

campaign are not incorporated into the r e- 

source model as the spacing of the drilling is 

still too wide along strike and down dip. 

Medusa’s managing director Peter Hepburn- 

Brown says, “This increase in indicated resources 

is pleasing as confidence levels have been 

significantly improved in key 

areas of the mine. The stepout 

drilling str ongly supports 

future resource additions as 

the mineralized system r e- 

mains open in all directions including 

at depth wher e the 

deepest ore grade intersection 

achieved to date is at 1073 

metres below surface. The 

current wide spacing of many 

step-out surface drill holes prevents 

incorporation of their 

corresponding intersections 

into the resource model. 

“Drilling is planned to continue 

with 6 surface and 3 underground 

rigs during the 

next 12 months with the aim 

of raising the resource level to 

about 2.5 million ounces following 

which the ongoing 

drilling programs will be tailored 

to replace at a minimum, 

mined ounces each year to 

maintain the resource base.” 

Construction of the new mill is on schedule 

with the titled tanks back in operation. A new 

leach tank was due to be completed by mid- 

August. The foundations for the detoxification 

unit have been completed and those for 

Gold and copper prospects and projects in the vicinity of Medusa’s Co-O 

project in eastern Mindanao. 

the SAG mill ar e advancing. W ork on the 

Saga Shaft is also advancing with completion 

of sink to level 8 expected by the end of August. 

The winder is in transit to the site while 

the skips and loading pockets have been manufactured. 

The shaft is expected to be completed 

during the fourth quarter. 


Vietnam 

ASIAN Mineral Resources (AMR) has decided 

to proceed with commissioning a detailed engineering 

and feasibility study for a smelting 

operation associated with the Ban Phuc Nikkel 

Project in Son La Province. The decision 

follows a conceptual study which indicated 

that construction of a smelter would produce 

attractive economics for the project. 

The incorporation of a smelting operation is 

also consistent with the Gover nment of the 

Socialist Republic of V ietnam’s desire for 

more in-country processing and its national 

mineral resources strategy to 2020, with a vision 

to 2030, adopted in December 2011, 

where one of the key objectives is the construction 

of a smelter in the Son La Province. 

The Ban Phuc project is 160km northwest 

of Hanoi and is 90% owned by AMR’s subsidiary 

Ban Phuc Nickel Mines LLC. Development 

of the pr oject is in advanced stages, 

with underground and surface infrastructure 

near completion and commercial production 

expected by June 2013. 

Ban Phuc LLC has been granted land use 

rights from the provincial people’s committee 

for areas which will house pump stations and 

pipe lines to the project site and camp areas. 

Ban Phuc has also been granted permission 

by the Muong Khoa Commune to stor e topsoils 

associated with construction of the tailings 

storage facility, which is expected to begin later 

this year. Receipt of land use rights is crucial 

for advancement of the construction and also 

demonstrates local government and community 

continued ongoing support. 

Detailed study for Ban Phuc nickel smelter 

Commercial production is expected at Asian Mineral Resources’ Ban Phuc Nickel Project by June 2013. 

The company has engaged Aur econ (Vietnam) 

Co to assist with power and electrical design 

work for the pr oject site and processing 

plant. In addition, Son La Power Company has 

completed preliminary design work for the 

high-voltage power line and primary substation 

from the national power grid to the site. Discussions 

with this company for installation 

works are in advanced stages, with the works 

expected to start this quarter. With the installation 

of the high-voltage power line, the project 

will benefit from access to low cost hydro-electrical 

power from Vietnam’s power grid. AMR 

intends to continue maximizing the use of local 

content, particularly where it will result in further 

investment within the local community. 

As part of its ongoing corporate social r e- 

sponsibility initiatives AMR has recently completed 

construction of a new community suspension 

bridge which has significantly 

improved the transportation and safety needs 

of the residents around the area. 

Meanwhile, AMR has appointed Simon 

Booth as general manager of operations for 

the project. He will oversee all aspects of the 

operations, including completion of construction, 

commissioning of the processing 

plant, and establishment and management 

of mining operations. He has extensive in - 

ternational experience in construction and 

operating mining operations in the Philippines, 

Australia, New Zealand, Guinea and 

Greenland, and brings more than 30 years 

of experience with major mining groups. 

Phuoc Son focus shifts to North Deposit 

WITH South Deposit reserves expected to be 

depleted by March 2013, Olympus Pacific Minerals 

is shifting its mining focus at the Phuoc 

Son Gold Project to the North Deposit wher e 

underground access began in 2011 and full 

planned production is expected by the end of 

the current quarter. The Bai Dat (South) and Bai 

Go (North) deposits lie about 700 metres apart 

and together occupy a 2km-long section of the 

5km-long Dak Sa shear zone. 

Second quarter gold production of 7839 ounces 

was lower than pr ojected. At Phuoc Son, 

ore is being sourced from two discrete deposits 

and the lower production resulted from diminished 

tonnage output during engineering r emediation 

of the South Deposit, compounded by 

higher than expected grade dilution during initial 

development of the North Deposit. 

Mining of the South Deposit began in 2009 

and the need for incr eased ground support 

has been identified this year with engineering 

remediation work subsequently slowing production. 

The remediation work is scheduled 

for completion this quarter and will allow r e- 

covery of high-grade pillars from upper sections 

of the mine and extraction of r esidual 

ore blocks from lower sections of the mine. 

At the North Deposit, access to the ore body 

was initially developed thr ough a peripheral 

zone of thin and faulted veining. Recovery of 

ore from this zone was accompanied by higher 

than expected grade dilution. Projected access 

to thick, down-dip vein sections in the current 

quarter is expected to allow an increased rate 

of production through introduction of mechanized 

cut and fill mining method later this year. 

Phuoc Son mill daily thr oughput has r e- 

cently been increased from 500 tonnes to as 

much as 800 tonnes without major issue or 

additional capital cost. Additionally , run of 

mine grade is also expected to rise as pr o- 

duction begins from wide lower vein sections 

of the North Deposit in the fourth quarter . 

Olympus Pacific expects to produce 60,000 

ounces for fiscal year ending June 30, 2013. 


Malaysia 

Lynas focuses on phase 2 at LAMP 

WITH construction of phase one of the Lynas 

Advanced Materials Plant (LAMP) completed 

and commissioning well advanced, L ynas 

Corporation is focusing on the phase 

two expansion pr oject, which is on 

track for completion in early 2013. 

Phase two, which has been termed 

LAMPS Up, will see annual rar e earth 

production increased to 22,000 tonnes 

and involves expansion work at the 

company’s mining operation in W e- 

stern Australia (WA) as well as at the 

LAMP in Malaysia. 

At the start of July the overall cumulative 

progress of LAMPS Up in W A was 

25% with engineering activities 62% 

complete and the project remaining on schedule 

and within budget. In Malaysia overall cumulative 

progress at the same time was 72% 

complete and engineering activities were 98% 

complete. Managing contractor Toyo-Thai Corporation 

is opening up mor e work fronts as 

momentum of site work increases. 

Phase one construction was completed during 

the second quarter and as at June 30 advanced 

completion of the pr e-commissioning 

test packs had enabled 77 out of 85 systems 

to be handed over for commissioning. The 

The foundations of both rotary kilns to be incorporated into the phase 2 

expansion at the Lynas Advanced Materials Plant in Gebeng, Malaysia. 

company’s operational preparedness program, 

Ready For Start Up (RFSU), was mor e than 

97% complete at the end of June. The balance 

of pending projects was not critical for plant 

start-up. Overall commissioning progress was 

64% complete as at the end of June. 

Phase one in Malaysia was completed Lost 

Time Injury (LTI) free. The project involved a total 

of 8,690,000 hours worked without an LTI. 

On June 18, Malaysia’ s Minister of Science, 

Technology and Innovation Datuk Seri 

Panglima Dr Maximus Johnity Ongkili dismissed 

the appeal that was lodged 

under Section 32 of the Atomic 

Energy Licensing Act in r elation to 

the decision of the Malaysian Atomic 

Energy Licensing Boar d (AELB) to 

approve the issuance of a Temporary 

Operating Licence (TOL) for the 

LAMP. The minister confirmed that 

“there was no strong justification or 

scientific or technical basis for him to 

set aside the decision of the Board”. 

Lynas also welcomes the findings of 

the Parliamentary Select Committee 

report on the LAMP which recommended that 

the TOL be issued for the LAMP . The report 

noted that Lynas has complied with the standards 

and laws of Malaysia, which ar e in line 

with international standards. 

Ahead of the start-up of the LAMP , Lynas 

elected to bring forwar d a period of r outine 

maintenance on the Mount W eld Concentration 

Plant in WA. 


Malaysia 

MONUMENT Mining and Phoenix Lake 

Sdn Bhd (PLSB) have agreed to work together 

to harmonize magnetite ir on ore 

operations at the designated ar ea of the 

Mengapur project in Pahang state. The 

parties have agreed that Monument will 

be sole operator of the oxide magnetite 

iron ore operation and ensure that PLSB 

continues to participate in this operation 

as contractor and retain the right to share 

profits; that other metals contained in the 

mined oxide magnetite ir on ore material 

remain with the owner of the Mengapur 

project; and that the environment is safeguarded. 

PLSB was carrying out the oxide magnetite 

operation at a certain designated 

area of the project pursuant to an iron ore 

agreement with the previous owner, which 

was terminated by MMSB, the successor 

of the operator of Mengapur. Subsequent 

to closing of the 70% Mengapur pr oject 

acquisition MMSB advised due to PLSB’s 

fundamental breach of the terms of this 

agreement including, but not limited to, 

Parties to co-operate over Mengapur iron ore 

extracting and r emoving other metals, 

non-compliance with certain environmental 

conditions and defaulting on consideration 

payments in exchanging the 

exclusive rights, such breach caused total 

damages totalling an estimated $312 million 

during a 12 month period up until January 

2012 to CASB, the owner of the 

mining lease, and potentially to Pahang 

state as a royalty recipient. 

Similar losses would have continued if 

PLSB were allowed to continue without a 

change in operating pr ocedure. In r e- 

sponse, PLSB filed legal claim against 

Monument and its subsidiaries, Cermat 

Aman Sdn Bhd (CASB) and Monument 

Mengapur Sdn Bhd (MMSB) for damages 

over $130 million. 

A meeting was called to r econcile the 

dispute with both parties agr eeing to act 

in good faith in harmonizing the operation 

for the best interest of both stakeholders 

with all legal claims to be dr opped after 

the agreement is duly signed. 

Meantime, at Monument’s Selinsing gold 

operations the phase three plant expansion 

to annual capacity of 1 million tonnes 

is nearing completion. Selinsing Gold 

Mine general manager Charlie Northfield 

says, “We expect to continue to ramp up 

throughput in coming months to full capacity 

by quarter 2 of 2013 as we make circuit 

changes to accommodate the 

changing ore characteristics to more sulphidic 

ores.” 

Gold production for the quarter ending 

June 30 was in line with the pr evious 

quarter, however, was reduced from the 

three quarters prior to that due to lower 

average mill feed grade. Production in the 

financial year totalled 44,585 ounces in 

line with fiscal 2011 but was below the 

expectation of 55,000 ounces mainly due 

to lower r ecovery that occurr ed during 

ramp up of tonnage through the new primary 

ball mill, downtime caused by commissioning 

of the phase three expansion, 

and transformation from oxide ore to transition 

(mixed) ore and plant changeover to 

better process sulphide ore. 


South Pacific 

NZ iron sands explorer appoints CEO 

TRANS-TASMAN Resources (TTR) is advancing 

environmental, geotechnical and 

beneficiation studies, and trials on its of f- 

shore iron sands projects off the west coast 

of the North Island of New Zealand. This 

work is bringing TTR closer to completion 

of a definitive feasibility study and seeking 

consents for production of iron ore. 

Trans-Tasman Resources new CEO Tim Crossley. 

The privately-owned New Zealand company 

believes the appointment of Tim Crossley 

as its chief executive oficer will assist it to 

reach its goal of extracting ir on ore from the 

rich iron sands deposits. The new CEO will 

be based in TTR’s Wellington head office and 

will take up the position in early October. 

Tim Crossley comes to TTR from Gloucester 

Coal, an ASX-listed diversified coal company 

with open cut and underground mining operations 

in NSW and Queensland, Australia. Prior 

to this he was a senior executive with Hancock 

Prospecting and was president and chief operating 

officer with BHP Billiton’s West Australian 

iron ore business, which shipped 123 million 

tonnes of high grade or e in FY 2008. Befor e 

working in the iron ore business, he held senior 

positions in BHP Billiton’s manganese and metallurgical 

coal divisions. 

TTR’s executive chairman Bill Bisset says he 

is delighted with the depth and breadth of experience 

that T im Crossley brings with him, 

particularly in the carbon steel raw materials 

sectors. “Tim Crossley is a very experienced 

senior mining executive with an outstanding 

mining sector track record that will bring demonstrated 

skills in managing large complex 

operations with sensitive environmental requirements. 

He understands the supply chain and 

is familiar with broad commercial issues which 

will be crucial for TTR’s future development. 

“This appointment marks a convergence of 

work streams and activities for TTR. It is timely 

to appoint a chief executive to manage this step 

change in an organization which has, until r e- 

cently, operated with small diversified of fices 

with a strong scientific focus. The evolution from 

a conceptual to an operational project is a very 

significant leap, and we look forwar d to Tim’s 

leadership in leading the company through this 

important stage in its development.” 

TTR was established in 2007 to explore, assess 

and develop the potential of the rich of f- 

shore iron ore deposits off the west coast of the 

North Island of New Zealand. Prospecting work 

to date suggests there is a vast world-class mineral 

resource which could supply Asian mar - 

kets with a reliable supply of low-cost iron ore. 

TTR has a JORC-compliant r ecoverable resource 

of 4.638 billion tonnes @ 6.23% iron. 


South Pacific 

GLASS Earth Gold has fully commissioned its 

second Gold Recovery Unit (GRU) at the 

Hecklers Mine in the Manuherikea V alley of 

Central Otago on New Zealand’s South Island. 

Current initial weekly production from 

placer operations at Hecklers and Gunclub 

mines now stands at 42 ounces of gold, with 

improved throughput and operating hours 

planned to further increase production. Glass 

Earth is also commissioning a third operation 

which should become fully operational by the 

end of September. 

“I am very pleased with the new mining team 

that has been set up since we took contr ol of 

placer mining activities. The team has shown 

a strong commitment to meet our pr oduction 

targets,” says Glass Earth’s CEO Simon Henderson. 

“The benefits of running these placer 

gold operations are multi-fold. In addition to 

providing a cashflow stream that supports G&A 

and exploration costs, the small-scale gold 

production supports advancement of the company’s 

projects regardless of market conditions 

and also facilitates the early development of 

additional projects if the opportunity arises.” 

Glass Earth increases placer production 

A Gold Recovery Unit in operation at a Glass Earth Gold 

placer project. 

In 2011, Glass Earth’s then 50% share of the 

placer joint venture contributed Can$752,000 in 

gross revenue and Can$274,000 in net revenue 

based on operating only one GRU. The increase 

in throughput from commissioning two additional 

GRUs and from gaining 100% ownership of 

placer gold operations, should enable the company 

to achieve its previously articulated annual 

production goal of 7500 ounces in 2013 at a 

cost averaging Can$900 an ounce. Glass Earth 

Gold is one of New Zealand’ s largest gold exploration 

companies, with its experienced geological 

team exploring promising gold prospects 

across a land position of about 8800sqkm on 

both the North and South islands. 

On the North Island, exploration ef forts are 

focused on large epithermal gold systems in 

the Hauraki Region, host to the 10 million 

ounce Martha Hill mine of Newmont Mining. In 

this region Glass Earth has identified and developed 

significant ground positions around 

Newmont’s operations at W aihi. The W aihi 

West JV and Hauraki JV, including drilling at the 

WKP discovery, are being explored and managed 

by Newmont in concert with Glass Earth. 

Glass Earth has also defined several significant 

epithermal gold targets to independently 

explore in this region including the Muirs Reef 

project. Containing a historical r esource of 

390,000 ounces (non NI 43-101-compliant @ 

1.5 grams/tonne gold), further drilling is being 

undertaken to prove up the resource. 

Recent drilling at the Massey Reef prospect 

of Muirs Reef has intersected gold bearing 

quartz reef along strike and down plunge of 

previous trenching and old mine workings. 


Central Asia 

Kounrad copper production exceeds expectations 

CENTRAL Asia Metals is confident of meeting 

its 2012 production target of 5000 tonnes of 

copper cathodes from the newly constructed 

SX-EW copper plant at the Kounrad pr oject 

in Kazakhstan. The plant was constructed at 

a capital cost of US$40 million, some 15% 

below budget, and began production on April 

29. As at June 30, a total of 1728 tonnes of 

cathode copper had been produced of which 

Central Asia Metals’ directors and executives at the opening of the Kounrad Copper Project in Kazakhstan this year. 

1386 tonnes was sold and deliver ed to 

Traxys Europe SA. 

Physical production of copper cathodes 

has exceeded management’s expectations 

for this early stage of production as the plant 

is still under commissioning. The plant is 

operating in accordance with the design capacity 

specifications and the assessed quality 

of the cathode copper has consistently met 

LME grade A quality standards. 

Central Asia Metals’ chief executive of ficer 

Nick Clarke says, “The commissioning phase 

of the SX-EW plant is pr ogressing well and 

several areas of the plant have been operating 

to 100% of their design capacity . We 

continue to record higher than expected levels 

of copper in solution fr om the leaching 

process on the dumps albeit this is expected 

to stabilize over time. I am personally delighted 

with the initial performance of both the 

leaching process and the SX-EW plant and 

am confident we will achieve our 2012 pr o- 

duction target of 5000 tonnes. We have been 

developing our r elationship with T raxys 

Europe SA and I am pleased that we have 

sold and deliver ed 80% of our first two 

months’ production.” 

Kounrad is 620km north of Almaty and is 

accessible by paved road. The mine is 18km 

north of the town of Balkhash and was operating 

from 1936 to 2005. CAML has 60% 

ownership of the Solvent Extraction/Electro- 

Winning Copper Recovery Plant with annual 

capacity of 10,000 tonnes and the waste 

dumps from the Kounrad open-pit copper 

mine in south-central Kazakhstan. The company 

is processing ore from waste dumps 

accumulated from 70 years of open-pit mining 

operations. 

Commissioning of the plant began in March 

2012 while on 20 April pr egnant leach solution 

was introduced to the plant. Plating of 

copper began on April 24 and on April 29 

more than 25 tonnes of copper cathodes 

were harvested. On May 24, 504 tonnes of 

copper were sold to Traxys. Central Asia expects 

the project to reach the 10,000 tonne 

annual production level during 2013. 

Not only is Central Asia’s copper purer than 

many other mines are capable of producing 

because of the nature of its ore, the cost of 

production is also among the lowest in the industry. 

This is because the company does 

not have to do any digging for its copper – it 

simply extracts it from the rock lying above 

ground. 

Using cash generated from early production, 

Nick Clarke hopes to build a second 

processing plant over the next couple of 

years, which would double annual production 

to 20,000 tonnes from 2015. 

Chanach licence extended four years 

JOINT venture partners White Cliff Minerals and 

T2Gold have been granted a four year extension 

to the Chanach exploration licence by the 

Government of the Kyrgyz Republic. Further , 

the Department of Natural Resour ces (DNR) 

has commented that Chanach LLC is one of a 

handful of companies that have complied with 

all regulatory requirements and is now a pr e- 

ferred tenderer for new licence applications. 

White Cliff and T2Gold intend developing a closer 

relationship with the DNR and will seek to 

acquire further advanced projects. 

The partners recently commissioned an extensive 

analysis of satellite ASTER spectral 

imagery to assist with targeting futur e exploration. 

ASTER imagery evaluates the wavelengths 

of light reflected from the surface and is used to 

identify alteration minerals exposed at surface. 

The survey has identified widespr ead argillic, 

phyllic and silicic alteration that may indicate the 

centre of the mineralized copper-gold porphyry 

system southeast of the existing drilling. 

Outcropping mineralized diorite dyke 

swarms containing both copper and gold appear 

to radiate from the centres of the ASTER 

phyllic and silicic alteration systems. If confirmed 

by field mapping and sampling this may 

indicate a system of mineralized porphyries 

within a diameter of about 5km. These tar - 

gets occur on and adjacent to outcr opping 

porphyries and importantly coincide with the 

copper mineralization previously identified at 

surface. The strongest targets occur on Silurian 

conglomerates and sandstones suggesting 

that these r ocks are underlain by 

porphyry intrusions. 


Central Asia 

Orsu advances financing for Karchiga 

A site plan for Orsu Metals Karchiga Copper Project in northeast Kazakhstan. 

THE sale of its 40% interest in the Talas Gold- 

Copper-Molybdenum Project in the Kyrgyz 

Republic together with the arranging of a project 

finance facility of up to US$90 million has 

provided Orsu Metals with the impetus to advance 

its Karchiga Copper Project in northeast 

Kazakhstan. The company hopes to start 

construction of the mine and pr ocessing facilities 

at Karchiga before the end of 2012. 

Orsu has completed the sale of its 40% interest 

in the T alas joint ventur e project to a 

wholly-owned subsidiary of Gold Fields for 

US$10 million. In addition, another whollyowned 

subsidiary of Gold Fields has advanced 

into escrow the gross proceeds of Can$10 million 

cash in connection with its subscription for 

25 million units of the company. 

Following the announcement of these arrangements, 

Orsu appointed Barclays Bank 

and UniCredit Bank Austria AG as co-ordinating 

mandated lead arrangers to use commercially 

reasonable efforts to arrange a 

project finance facility of up to US$90 million. 

Orsu’s executive chairman Dr Sergey V 

Kurzin says, “This is a key milestone in arranging 

the senior debt finance which will pr o- 

vide the gr oup with a firm foundation to 

achieve its aim of commencing construction 

in the second half of this year , following on 

from completion of the Kar chiga definitive 

feasibility study (DFS) earlier in the year, and 

the agreements with Gold Fields for the sale 

of the group’s interest in the Talas project and 

subscription for new units.” 

Before the Gold Fields arrangements, it 

held 0.72% of Orsu but following completion 

of the subscription, it will own mor e 

than 26 million shar es, representing a 

14.31% shareholding, as well as 12.5 million 

warrants, which if exercised would result 

in an 18.32% stake. 


Australia 

Centrex Metals’ Fusion DFS on track 

CENTREX Metals will complete a $45 million 

definitive feasibility study at its Fusion Magnetite 

Project by early 2013 to establish the commercial 

potential of a 5-10 million tonne annual production 

schedule. A scoping study for the 499 

million tonne inferred and indicated Eyre Peninsula 

resource was completed with positive 

results during the June 2012 quarter. 

This study incorporated utilizing the nearby 

proposed Port Spencer facilities with the 

Centrex/WISCO (Wuhan Iron and Steel 

Group) joint venture. A formal submission to 

the South Australian government is awaiting 

approval for development of the bulk commodities 

port. Approval from China’s National 

Development and Reform Commission 

(NDRC) is also necessary before the joint venture 

can begin a design feasibility study. 

A maiden 54.5 million tonne indicated mineral 

resource was announced at the Koppio deposit 

within the Fusion project during this quarter. 

The deposit’s inventory has grown by 34% to 

a combined inferred and indicated resource of 

176.3 million tonnes. Further drilling at the site 

this year is expected to convert more of the mineral 

resources to the indicated category. 

There were 23,000 metr es of diamond 

and geotechnical drilling completed at the 

Kapperna deposit within the pr oject area 

during the last quarter, with results expected 

before the end of the year to assist with 

estimation of mineral resources. 

Fusion is about 35km north of Port Lincoln 

in the southern end of the Eyre Peninsula. It 

comprises several prospective magnetite deposits 

spanning a 50km anomalous magnetic 

BIF trend. Centrex wants to establish a centralized 

processing facility to access all deposits 

within the project area and transport ore 

40km northeast via a slurry pipeline to Port 

Spencer for export. The port facility proposal 

includes construction of a 515 metre jetty and 

a ship loader with hourly capacity of 5000 

tonnes, road works and power supply. 

Centrex’s other iron ore projects include the 

Goulburn/Archer tenements in southern New 

South Wales, where access to prospective 

targets is being negotiated with landowners 

to allow for a drill program to commence later 

in the year. The company’s Wilgerup hematite 

iron mine in the Eyre Peninsula has received 

full approval and will be developed in line with 

the development of Port Spencer. 

The Bungalow magnetite joint ventur e, 

also on the Eyre Peninsula, is on schedule 

and budget for completion of its pr e-feasibility 

study by December. The total mineral 

resource at this prospect is 338 million tonnes, 

which could be revised after a pit optimization 

study later this year. Negotiations 

with landowners have begun and assessments 

of the electricity connection options 

at the site have been completed. 

Maiden DSO resource at Telecom Hill 

A MAIDEN inferred direct shipping ore (DSO) 

mineral resource of 11.5 million tonnes @ 

58.55% iron has been declared by Padbury Mining 

at the Telecom Hill deposit of its Peak Hill 

Joint Venture with Aurium Resour ces in Western 

Australia’s Mid-West. As well as enabling 

completion of the estimate, r ecent drilling has 

Outcropping of hematite at the Telecom Hill deposit of Padbury 

Mining’s Peak Hill project in Western Australia’s Mid-West. 

expanded the mineralized zone to the west and 

further emphasized the deposit’s potential. 

A 33-hole, 3007 metre DSO drilling program 

was completed at the T elecom Hill 

East deposit earlier this year with r esults 

supporting the aeromagnetic interpretation 

that suggests more mineralization is likely to 

occur to the east and west. The r e- 

verse circulation percussion program 

was successful at targeting hematite 

and goethite enrichment of the Robinson 

Range Formation. Recent 

drilling has also led to the discovery 

of a new area of hematite warranting 

further exploration. Six r ock chip 

samples from the site have revealed 

highly encouraging results of up to 

62.81% iron and the company says 

there is potential for additional buried 

mineralization at this site. 

This maiden DSO estimate is a 

major milestone for the pr oject which 

is about 120km northwest of Meekatharra 

in the Mur chison region. The 

joint venture partners will continue to 

develop the project and work towards 

a pre-feasibility study to provide a better 

understanding of its economics, 

and will add to the viability of the Mid-W est 

port and rail infrastructure. The partners will 

also continue to look for new DSO assets and 

any additional DSO sources that may be defined 

from identified exploration targets. 

Drilling at the Telecom Hill West magnetite 

target has demonstrated that mineralization 

is continuous and high-quality concentrate is 

achievable. At Telecom Hill East the drilling 

program successfully delineated additional 

magnetite deposits by targeting prospective 

areas recognized in the detailed aeromagnetic 

survey flown in 2011. This new ar ea extends 

over a strike length of 1.6km, is 

120-150 metres thick and extends to depths 

of 240 metres below surface. 

A number of other significant magnetite tar - 

gets have been recognized and will be targeted 

with evaluation programs in the future. Padbury 

has started estimated work to update the Telecom 

Hill West inferred resource and to estimate 

new quantities at Telecom Hill East. 

Padbury has also continued discussions 

with potential domestic and Chinese investors 

to establish a mid-west infrastructur e 

company designed to develop rail and port 

infrastructure for the whole r egion in stages 

and to manage it independently. 


Australia 

WEST Australian-based miner Atlas Ir on 

says a 70% increase in its Pilbara ir on ore 

reserves will underpin its expansion strategy 

in the region. Atlas acquired FerrAus in December 

last year, adding 444.3 million tonnes 

to its ir on inventory. Exploration and 

evaluation drilling programs have also added 

to overall reserves with a net increase of 2.2 

million tonnes announced at Mt Webber following 

infill drilling at three deposits. 

During the June 2012 quarter, Atlas drilled 

739 reverse circulation holes across 77,694 

metres at its Pilbara projects, with three-quarters 

of the holes drilled at McPhee Creek. The 

company’s production during the quarter was 

25% higher than the March quarter, with iron 

ore shipments totalling 5.57 million tonnes for 

the 2011-12 financial year, a 21% increase on 

the 2010-11 period. 

Some projects reported decreases in reserves 

with 2.2 million tonnes wiped off the Abydos 

total, 8.7 million tonnes depleted at the 

Pardoo and Wodgina mining operations and 

43.9 million tonnes taken of f the McPhee 

Creek resource base after infill drilling revealed 

a reduction in ore density. However, a 49.1 million 

tonne increase at the Boolgeeda Formation 

and a maiden inferred resource of 41.2 million 

Atlas boosts Pilbara iron ore reserves 

Mining at Atlas Iron’s Pardoo operations in the Pilbara 

region of Western Australia. 

tonnes at Hickman has further boosted Pilbara 

reserves to a total of 414 million tonnes. 

Atlas’ managing dir ector Ken Brinsden 

says, “This reserve growth represents a key 

step towards establishing the inventory to underpin 

our expansion strategy. We have continued 

to grow our North Pilbara reserves net 

of depletion, McPhee Creek has delivered an 

impressive maiden reserve and the growth in 

South East Pilbara reserves is outstanding. 

Another significant ore reserve and mineral 

resource update, particularly fr om McPhee 

Creek, is expected later in the year. 

“Our exploration and resource development 

priorities in the Pilbara ar e strongly aligned 

with our Horizon 1 and Horizon 2 growth programs 

and we expect to continue to deliver 

further reserve growth to underpin our future 

Pilbara infrastructure objectives.” 

Atlas began exporting direct shipping ore 

(DSO) from its Pardoo project in December 

2008 and its Wodgina project in June 2010. 

It plans to bring the Mt Dove, Abydos and Mt 

Webber mines into pr oduction during the 

next 18 months to achieve its annual export 

goal of 10 million tonnes by June 2013. Ken 

Brinsden says the company will continue to 

increase its DSO exports to reach an annual 

total of 12 million tonnes by December 2013 

and with the addition of McPhee Cr eek and 

its South East Pilbara assets, will target 46 

million tonnes during the 2017 calendar year. 

Atlas has also signed a memorandum of 

understanding with QR National to fast track 

the evaluation of an independent railway in 

the Pilbara region. The proposed Pilbara Independent 

Rail (PIR) project would connect 

iron ore deposits owned by Atlas and other 

companies in the East and South-East Pilbara 

to Port Hedland. The study is expected 

to be completed by the end of 2012 with first 

haulage earmarked for as early as 2015. 

DESPITE losing its proposed major partner due 

to legal challenges in Russia, Flinders Mines will 

hold further negotiations r egarding development 

and construction of infrastructur e at its 

Pilbara iron ore project, as the company finalizes 

sinter test work and product specification. 

MMK (Magnitogorsk Iron and Steel Works) terminated 

its Scheme Implementation Agr eement 

(SIA) with Flinders after lawsuits in Russia 

delayed the agreement’s completion. 

Flinders says it will continue to pursue the 

development and de-risking of the 917 million 

tonne project and is focused on engaging a 

new strategic partner with the ultimate aim of 

fully developing the Pilbara project and achieving 

production and cashflow. A phase four 

metallurgical test work pr ogram has also 

been initiated with five diamond drill holes 

planned over 394 metres to form the basis of 

the processing design to be included in the 

company’s definitive feasibility study (DFS). 

Flinders seeks new Pilbara partner 

Flinders’ managing director Gary Sutherland 

says project work during the June 2012 

quarter focused on the drill program and preparation 

of sinter samples to be analyzed in 

China. The results of the sinter pr ogram will 

form the basis of the final product strategy for 

the project. “Three rounds of China-based 

marketing activities have been completed 

with a total of 32 high potential steel mill customers 

visited. Much of the feedback has 

been overwhelmingly positive with many r e- 

questing results of sinter test work as it becomes 

available. Follow up visits to potential 

customers in China will take place in October 

and November, post sinter test work.” 

The geotechnical study for the pr oject was 

also completed during the last quarter and supports 

PFS-level mine planning assumptions on 

which the current DFS design work is based. 

Mine scheduling work on two different options 

which reflect two product mix scenarios have 

both shown proven consistency. Flinders has 

put mine planning on hold until the sinter test 

work results are available and then a final decision 

on the product mix will be made. 

Both state and federal government approval 

processes have continued during the 

quarter and Flinders expects tenement mining 

approvals to be received by October. A 

draft groundwater study was also submitted 

to the W estern Australian Department of 

Water for consideration, while the envir onmental 

factors are being integrated into the 

DFS mine plan and schedule. 

Work on the geological model has also continued 

with targets generated from field mapping. 

Flinders says the incr eased geological 

confidence in the completed model will allow a 

re-estimation of the resource to upgrade part 

of the indicated resource to a measured category. 

The company has also planned a balanced 

drill program for the remainder of the year. 


Australia 

Venus continues Chinese discussions 

DISCUSSIONS are continuing with Venus 

Metals’ Chinese partners about futur e 

work programs to assist with commercializing 

its Yalgoo Iron Ore Project. Venus signed 

a farm-in and joint venture agreement 

in 2010 with HD Mining and Investment, 

which is a subsidiary of the Chinese-based 

Shandong Provincial Bureau of Geology 

and Mineral Resources. 

Under the agreement, HD can ear n up to 

50% in the iron ore rights at Yalgoo by funding 

an Aus$8 million exploration pr ogram 

during the next two years. Venus will receive 

a 4.5% gross iron ore royalty from any production 

from Yalgoo, even if it elects not to 

contribute further to the project. 

Yalgoo is within Western Australia’s emerging 

Murchison Mid-West iron ore province 

about 80km north of Gindalbie Metals’ 

world-class Karara iron ore project. Earlier 

this year, Venus commissioned geological 

consultants to produce an updated JORCcompliant 

resource estimate for the Bilberatha 

Hill pr ospect, with the new model 

included in the total Yalgoo magnetite mineral 

resource of 698.1 million tonnes, including 

311.2 million indicated tonnes. 

The company’s chief financial officer Patrick 

Tan says a pre-feasibility study at the 

site demonstrates the project is technically 

viable and financially robust. A mining lease 

application has been submitted to Department 

of Mines and Petroleum covering Bilberatha 

Hill and additional magnetite 

mineral resource target areas within the tenement. 

Exploration at the site is continuing 

with the definition of further drill targets 

aimed at expanding the resource base. 

The company is also exploring a number 

of other areas in Western Australia for potential 

Proterozoic-class giant iron oxidecopper-gold 

ore deposits. Venus received 

a state government grant through an incentive 

scheme to evaluate pr ojects with 

high geological merit. The funding will be 

spent to carry out deep drilling at its Radi 

Hills and Citadel pr ojects near its T elfer 

Super site in the Pilbara region. 

Another site under exploration is the Moodini 

tenement at the company’s Gawler Craton 

West super pr oject area, where a 

north-trending Proterozoic basement fault 

has been interpreted as the boundary of the 

South Australian orogenic belt which hosts a 

number of world-class giant or e deposits 

such as Olympic Dam (ir on oxide-coppergold-uranium) 

and Mt Isa (base metals). 

Spinifex Ridge indicated resource up 27% 

MOLY Mines has announced a 27% increase 

in the indicated r esource, net of 

mining depletion, at its Spinifex Ridge 

iron ore mine in Western Australia’s Pilbara 

region. The incr ease has been 

achieved through a combination of additional 

infill drilling and a r eview of the In 

Situ Bulk Density (ISBD) used in the 2010 

resource estimate for the mine, which is 

about 170km east of Port Hedland. 

The operation takes in four prospect 

areas - Auton, Auton North East, Dalek 

and Gallifrey. Drilling acr oss these 

areas has upgraded portions of the resources 

from inferred to indicated categories 

and defined a maiden 

JORC-compliant resource estimate of 

7.3 million tonnes @ 59% iron. 

Optimization studies based on the 

new resource are under way and a r e- 

vised ore reserve estimate and mine 

plan will be announced in coming 

weeks. The company anticipates that 

the resource increase will extend the 

mine life into the second half of 2016, 

subject to port access. 

Moly has mined and shipped mor e 

than 1 million tonnes of iron ore from Spinifex 

Ridge, with 220,824 wet tonnes 

mined during the June 2012 quarter and An aerial view of iron ore operations at Moly Mines Spinifex Ridge project. 

270,995 wet tonnes of or e sold in the 

same period. The sales figure is up 5% 

on the previous quarter. 

The company has an imperative to 

grow via merger and acquisition pr o- 

cesses, as the mine has a r elatively 

short life. It is also hoping to impr ove 

the economics of its neighbouring molybdenum/copper 

project which is currently 

on hold. 

Moly’s secretary Andrew Worland says 

a number of near-term producer opportunities 

are being reviewed with a focus 

on those financed thr ough Chinese 

commercial banks as the company’ s 

major shareholder, Sichuan Hanlong 

Group, has a strategic alliance with the 

China Development Bank. 

“The company has r ecently entered 

into iron ore price and currency hedging 

arrangements with a major global financial 

institution and has commenced placing 

orders under this facility . The 

hedging facility is for up to 900,000 tonnes 

of iron ore with a matching for eign 

exchange facility of up to US$108 million. 

The program is designed to reduce 

the risks associated with significant fluctuations 

in iron ore prices and foreign exchange 

rates,” he says. 


Australia 

IRONCLAD Mining is conducting a resource 

re-estimation after recent drilling at its W ilcherry 

Hill iron ore project provided geological 

model updates and detailed 

interpretations of the ore body earmarked 

for mining. A highlight of the 2000 metre infill 

drill program at the South Australian project 

was the delineation of continuous 

zones of direct shipping ore (DSO) with a 

higher than 60% iron grade. Further closer 

spaced drilling is being planned to confirm 

any additional DSO reserves. 

IronClad’s executive chairman Ian Finch 

says the company’s main activity during the 

last quarter was a r eview of the proposed 

mining schedule to incorporate an initial 

high grade DSO mining stage. “Pit optimization 

work was completed, producing the 

initial DSO mining schedule and various 

scenarios for mining and processing of dry 

magnetic separation (DMS) and gravity separation 

(GS) ores. Other work completed 

includes a full r eview of the mine surface 

layout with the aim of optimizing the location 

of physical assets.” 

Wilcherry Hill DSO prospects strengthened 

Extensive work with the pr eferred mining, 

haulage and crushing contractors is being 

conducted and detailed mobilization, commissioning 

and ramp-up plans are being developed. 

Wilcherry Hill is about 100km west 

of South Australia’s steel industry capital of 

Whyalla, and about 40km north of Kimba in 

the northern Eyre Peninsula. It covers four tenements 

over an area of almost 1000sqkm. 

IronClad, a subsidiary of Trafford Resources, 

produced the first shipment of iron ore 

from the project after mobilizing a crushing 

plant and beginning construction of a DMS 

plant in January. It plans to ramp up pr o- 

duction rapidly, to become a 12 million 

tonne annual operation by 2015, when production 

will be shifted to the nearby Hercules 

deposit. This deposit has a curr ent 

JORC inferred resource of 198 million tonnes, 

which is confirmed in a banded ir on 

formation extending more than 10km. Iron- 

Clad says the current estimate is based on 

drilling from only 2km of the formation, meaning 

there is potential for a total resource of 

up to 2 billion tonnes. 

IronClad has r eceived an exploration licence 

for Hercules with drilling expected to 

begin by October. The receipt of this significant 

approval will ultimately lead to an increase 

in resources and reserves. 

The company has received international recognition 

for its innovative appr oach at Wilcherry 

Hill, particularly for the pr oduction of premium 

grade DSO from crystalline magnetite iron ore 

by crushing and scr eening, and adding magnets 

during processing. Another of the company’s 

unique concepts is the floating harbour 

which cuts road and rail transport distance from 

mine to port by about 350km. IronClad has developed 

a floating port 10km offshore at Lucky 

Bay to be serviced by two self-propelled barges. 

A recent Federal Government grant of $2.2 million 

to the Franklin Harbour District Council will 

assist with expansion of the port facility. 

Meantime, the company has appointed a 

new chief executive officer with Robert Mencel 

accepting the role. His main responsibilities 

will be with all technical matters r elating 

to the implementation of mining, transport 

and processing operations at Wilcherry Hill. 


India 

NSL attracts orders from steel producers 

NSL CONSOLIDATED has received multiple 

purchase orders directly from Indian steel producers 

for trial quantities (100–1000 tonnes) of 

iron ore produced at the Kur nool dry separation 

iron ore plant in the southeast state of 

Andhra Pradesh. The steel producers are purchasing 

material ex-gate and transporting to 

their steel manufacturing plants to determine 

the material’s suitability for each of their steel 

manufacturing processes. Upon successful trialing 

the company expects the pur chased 

quantities to increase substantially. 

Pricing is in line with the pr evailing market 

where 54-58% iron ore can be sold ex-gate 

to domestic steel mills for between INR3400- 

INR4900 per tonne, depending on the final 

grade. Using a six month average exchange 

rate, this r epresents about US$65-93 per 

tonne ex-gate as compar ed to anticipated 

steady state cash costs of production of approximately 

US$18 per tonne. 

Domestic demand and pricing for ir on ore 

remains particularly strong with NSL continuing 

to receive numerous approaches from 

industry players seeking to secur e offtake 

from the Kurnool project. The National Mineral 

Development Corporation (NMDC), India’s 

largest domestic supplier of ir on ore, continues 

to increase pricing. 

After completing the commissioning 

process in early July , 

NSL is expecting a gradual 

ramp-up in pr oduction and 

sales tonnages towards the targeted 

phase 1 annual production 

capacity of 200,000 tonnes 

during the September quarter. 

The ramp-up process includes 

expanding equipment and labour 

at the Mangal mine, starting 

up the Kuja mine and 

recruiting and training additional 

dry plant operators. 

The phase 2 wet beneficiation 

plant for Kur nool, capable 

of producing final product grades 

of between 58-62% iron, is 

anticipated to be brought into 

operation later in 2012 with completion and anticipated 

sales in the first half of 2013. This is 

targeted to increase annual production capacity 

by an additional 200,000 tonnes to a total 

of 400,000 tonnes from Kurnool. 

NSL’s iron ore projects are in the southeast Indian state of Andhra Pradesh. 


Papau New Guinea 

Gold confirmed at new Mt Kare prospect 

VISIBLE gold has been confirmed at intermittent 

locations within a drill cor e from a new 

prospect at Indochine Mining’s Mt Kare project. 

The 33 metre drill core was taken about 

1km south of the curr ent Mt Kare resource. 

Fine grained disseminated visible gold has 

been identified from 170 metres depth, and 

the hole is now being extended. 

Indochine says the style of mineralization 

within a sheared siltstone/sandstone host appears 

to differ from the currently identified resource 

to the north, although it is interpreted 

to occur in the same stratigraphic sequence. 

In July, the company posted high grade results 

from the current drill program including 

53.9 metres @ 8.2 grams/tonne gold, 18 

grams/tonne silver from 30 metres and 35 

metres @ 8.1 grams/tonne gold and 19 

grams/tonne silver from 11 metres. Best results 

from earlier drill holes included 47 metres 

@ 2.5 grams/tonne gold and 20 

grams/tonne silver from 16 metres, including 

15 metres @ 4 grams/tonne gold and 29 

grams/tonne silver from 36 metres. 

Indochine’s chief executive officer Stephen 

Promnitz says these results simply confirm the 

robust nature of the 1.8 million ounce gold/20 

million ounce silver r esource. “Virtually every 

drill hole to date contains high grade gold, 

which shows the consistency of the project. Intervals 

of almost an ounce per tonne gold ar e 

similar to the initial grades at nearby Porgera, 

one of the world’s top 10 gold mines.” 

Results from a further 40 drill holes are expected 

to be r eleased during the coming 

months, which will pr ovide the basis for a 

pre-feasibility study of an operation annually 

producing 125,000-150,000 ounces. The 

study will be released to the public by the end 

of September. In total, 415 diamond drill 

holes over 67,000 metres have been completed 

at the project which has a current JORC 

resource of 28 million tonnes @ 1.9 

grams/tonne, with a higher grade zone of 

700,000 ounces of gold at 3.7 grams/tonne 

gold. Indochine is working to relieve the bottleneck 

in shipping and pr ocessing the drill 

core with assay results scheduled routinely. 

Yandera feasibility study nears completion 

An outline of Marengo’s proposed Yandera Central open pit. 

MARENGO Mining says the feasibility study 

for its flagship Yandera copper-molybdenumgold 

project in central Papua New Guinea is 

nearing completion, in conjunction with an 

environmental impact study (EIS) which will 

be submitted to the country’ s Environment 

and Conservation Department. Both of these 

documents are expected to be sent to the 

government for approval by the end of September, 

for development of one of the Asia- 

Pacific’s largest copper resources. 

The company’s development concept at 

Yandera includes a full open-cut mining operation 

and pr ocessing facility, with copper 

concentrate and by-product magnetite concentrate 

being delivered to a Madang region 

port by pipeline. Smaller volumes of highvalue 

molybdenum concentrate produced at 

the site will be delivered by road transport. 

Marengo wants to construct an integrated 

rock waste and process tailings facility nearby 

as well as a power station to r eticulate electricity 

to the Yandera site. The company has 

raised Can$20 million through a placement 

which boosted cash r eserves to underpin 

completion of the required studies. 

In May, the company substantially updated 

the resource at the project using assay results 

from 465 diamond drill holes, totalling 

145,335 metres, which were drilled in 2011. 

At a 0.25% copper cut-of f grade, the r e- 

source has a measur ed and indicated 362 

million tonnes @ 0.43% copper compared to 

359 million tonnes in the 2011 estimate and 

a further inferred 218 million tonnes @ 0.37% 

copper for 1.778 billion pounds of contained 

copper. There are also confirmed ar eas of 

elevated gold and molybdenum grades, with 

a measured and indicated 199 million tonnes 

@ 0.17 grams/tonne gold and 532 million 

tonnes @ 0.01% molybdenum. 

“The resource update supports the previously 

stated goal of achieving a minimum operating 

life of at least 20 years. The measured 

resource category has incr eased by mor e 

than 100% and substantial additional resources 

have been upgraded from the inferred to 

indicated category, says Marengo’s managing 

director Les Emery. “Furthermore, areas 

of higher grade copper have been identified 

that can potentially be targeted for the initial 

years of possible production.” 


Papau New Guinea 

Maiden resource for Nakru 1 project 

A MAIDEN 38.4 million tonne inferred resource 

has been estimated for Coppermoly’s Nakru 

1 copper-gold-silver project on New Britain Island. 

The estimate uses a 0.2% copper cut-of 

and grading of 0.82% copper equivalent for 

233,400 tonnes of copper, 11 tonnes of gold 

and 69 tonnes of silver. Coppermoly says with 

further drilling, the resource tonnage could significantly 

increase, once parameters of the 

overall mineralization are determined. 

“With the exploration completed by Coppermoly 

and Barrick over the past four and a 

half years, we have achieved r esources at 

Nakru and Simuku with a total copper inventory 

of more than 2 billion pounds of contained 

copper,” says managing director Peter 

Swiridiuk. “We expect further drilling to improve 

the size of the Nakru 1 r esource and 

with Nakru 2 next door r equiring a similar 

amount of drilling, ther e is certainly much 

more copper yet to be found.” 

Additional drill programs will also help define 

the extent of gold and tellurium cr edits 

which may become a significant portion of 

the overall mineralization. 

The Nakru 1 copper -gold system is the 

most advanced pr ospect within this tenement 

with recent drill results from an overlying 

blanket of secondary copper revealing intersections 

of 13.55 metres @ 2.8% copper and 

0.23 grams/tonne gold fr om 74.45 metres 

and 22.23 metres @ 1.47% copper and 0.13 

grams/tonne gold from 98.75 metres. On the 

eastern edge of the prospect, an epithermal 

Coppermoly’s copper and copper/gold prospects on New Britain island. 

gold vein was intersected with 23.5 metres @ 

1.3% copper and 2.38 grams/tonne gold 

from 87.3 metres including 1 metre @ 4.6% 

copper and 42 grams/tonne gold and 2840 

ppm tellurium from 99 metres. 

Coppermoly and its joint venture partner Barrick 

PNG Exploration have spent almost $22 

million on drilling and exploration acr oss the 

Nakru, Simuku and T alelumas tenements 

which are in the island’s central west, about 

50km south of the port of Kimbe. Barrick has 

announced it is selling its 72% stake, however 

it remains responsible for all work programs including 

rates, levies and work commitments. 

The obligations under the original farm-in 

agreement with Coppermoly will stand until 

any divestment of Barrick’s interest occurs. 

This means Barrick will still remobilize a $2.2 

million exploration pr ogram during the r e- 

mainder of 2012 and carry out further drilling 

on the Nakru and Simuku tenements. 

Simuku has an inferred resource of 200 million 

tonnes @ 0.36% copper, 61ppm molybdenum, 

0.06 grams/tonne gold and 2 grams/tonne silver. 

Coppermoly has also been granted an exploration 

licence for the 280sqkm Makmak 

tenement nearby and has applied for two additional 

tenements within the same region. 

INITIAL results from metallurgical test work 

on gold found at Gold Anomaly’ s flagship 

Crater Mountain project show most of the 

gold within the Nevera pr ospect could be 

recovered by grinding and leaching. A preliminary 

assessment of gold mineralization 

at Nevera prospect involved gravity r ecovery, 

cyanide leaching and flotation. The 

copper-gold project in Easter n Highlands 

province has a 790,000 ounce inferred gold 

resource within the Mixing Zone. 

The company’s exploration director Peter 

Macnab says using a grind of 75 micr ons, 

simple gravity separation r ecovered more 

than 50% of contained gold, whilst bottle 

roll agitation cyanide leaching r ecovered 

Promising test work at Crater Mountain 

between 76% and 83%, and flotation a little 

more than 95%. Reprocessing of the Knelson 

gravity concentrate using a hand pan 

indicated final grades of gr eater than 100 

grams/tonne gold should be r eadily achievable. 

During cyanidation testing, most of 

the gold was dissolved into solution within 

8 hours, with gold extraction ranging fr om 

75% to 78.9%. 

A major proportion of the tailings from the 

cyanidation testing were found to be encased 

in sulphide which prevents exposure to 

the cyanide solution at the 75 micron grind 

and Gold Anomaly says it will conduct further 

tests to increase the gold recovery with 

ultra-fine grinding. 

“The test results are pleasing as they indicate 

crushing and grinding characteristics are good, 

and that at a 75 micr on grind more than 75% 

of the Mixing Zone gold can be expected to be 

extracted by agitation leach in 8 hours, with 

moderate lime and cyanide usage. We are confident 

that further metallurgical testing will pr o- 

vide a flowsheet capable of r ecovering more 

than 90% of the gold,” says Peter Macnab. 

During late 2011 and 2012 Gold Anomaly 

carried out detailed geological mapping and 

sampling at Crater Mountain’s Nimi and Awanita 

prospects, and commenced work on the 

Masi prospect. These prospects show similar 

mineralization characteristics to Nevera which 

has been the primary focus since 2010. 



2012 Calendar 

DISCOVER MONGOLIA 2012 

August 30-31, Ulaanbaatar, Mongolia 

www.discovermongoliaforum.com 

FRONTIER SECURITIES ANNUAL CONFERENCE 

September 3-5, Ulaanbaatar, Mongolia 

www.frontier-conference.com 

2ND ANNUAL DRILL AND BLAST ASIA 

September 3-4, Jakarta, Indonesia 

www.drillandblastasia.com/Event.aspxid=731016 

KALIMANTAN COAL 

September 4-5, Balikpapan, Indonesia 

www.immevents.com 

2012 AMEC CONVENTION 

September 4-7, Perth, Western Australia 

www.amec.org.au/events/convention 

MINING MONGOLIA 2012 

September 5-7, Ulaanbaatar, Mongolia 

www.miningandconstructionmongolia.com 

MINE CLOSURE REHABILITATION 

September 10-13, Bali, Indonesia, www.ibc-asia.com/conferences/commodities/mine-closure-and-rehabilitation-conference 

MINING PHILIPPINES 

September 18–20, Manila, Philippines 

www.chamberofmines.com.ph 

SOUTH AMERICAN DIGGERS ’12 

September 19 and 20, Sydney, Australia 

www.southamericandiggers.com.au 

MINEXPO 2012 

September 24-26, Las Vegas, Nevada, USA 

www.minexpo.com 

M&E INDONESIA MINING & ENGINEERING 

October 10-12, Jakarta, Indonesia 

www.miningandengineeringindo.com 

MINES & MONEY AUSTRALIA 

October 15-17, Sydney, Australia 

www.minesandmoney/com/australiac 

GOLD SYMPOSIUM 

October 22-23, Sydney, Australia 

www.gold.symposium.net.au 

ASIAN MINING INDABA 

October 29-31, Singapore 

www.asianminingindaba.com 


Australian Technology 

A pilot plant to test a new nickel laterite 

process is being constructed 

at the Australian Mineral Research 

Centre in Waterford, Western Australia. 

Photo courtesy CSIRO. 

CSIRO helps mining industry work more efficiently 

By John Miller, editor, The ASIA Miner 

WITH the introduction of a carbon tax in 

Australia and gr owing awareness of the 

need for more environmentally friendly exploration 

and mining practices, now mor e 

than ever the mining industry needs to work 

smarter and more efficiently to ensure its future 

viability. Australia’s Commonwealth 

Scientific and Industrial Research Organisation 

(CSIRO) is at the for efront of development 

of a range of technologies that can 

assist the industry impr ove its competitiveness 

and environmental performance. 

The CSIRO’s Minerals Down Under Flagship 

works across the minerals value chain to 

deliver science and technology solutions that 

will help grow Australia’s resource base, increase 

the productivity of the minerals industry 

and reduce its environmental footprint, 

both in Australia and globally. The flagship’s 

director Jonathan Law says the CSIRO is 

working with industry partners to develop 

technologies that assist the industry and also 

deliver positive flow-on effects into other challenging 

areas such as soil salinity, water quality 

and waste utilization. 

Jonathan Law says the work of the 

CSIRO is very important to Australia’s mining 

industry in two ways: 

• It takes a long term view of the mining 

industry in Australia so it looks at the 

challenges in 10 or 15 years rather than 

the short-term challenges of today . It 

has the freedom because of the government 

investment and its r esources to 

take the long-term view and work on 

technologies that will be important but 

that can’t be delivered in a two or three 

year timeframe. 

• Secondly, it has a very str ong engagement 

with industry on a day-to-day 

basis, working on the operations and issues 

faced daily. About 50% of the r e- 

venue comes fr om industry and the 

CSIRO works closely with this sector , 

which makes sure it is aligned with what 

the current challenges are. 

The mining industry is global and the 

CSIRO’s work is also important at a global 

level. “Many of those we work with in Australia 

are global miners looking to deploy 

technologies around the world. Because 

many of the challenges the industry faces 

are shared globally and not particularly conducive 

to economic competitiveness, many 

countries are happy to work with Australia 

to develop solutions that are generally good 

for the industry,” Jonathan Law says. “There’s 

a whole range of factors like pr oductivity, 

energy and water - factors that have 

the potential to drive the industry out of bu- 



siness, and people are generally happy to 

share technologies in that space. Being 

connected globally is very important for us 

in terms of making sur e we work with the 

best companies and organizations ar ound 

the world. Having said that, we always try 

to make sure we deliver benefits for Australia. 

A lot of our technologies ar e based on 

Australia-specific challenges in which case 

we are happy to lead.” 

The CSIRO has brought together a portfolio 

of activities in the Minerals Down 

Under Flagship, he says. “About 10 years 

ago the organization took a look at itself 

and asked the question: Are we really working 

on the most important big pictur e 

things for Australia There was a view that 

we were probably working on too many 

things in too many diverse ar eas and that 

we didn’t have a long-term strategy for real 

impact in some of the big national challenges, 

and this resulted in the National Research 

Flagship pr ogram led by CSIRO. 

Five years ago the Minerals Down Under 

Flagship was formed in recognition that the 

minerals industry was important to Australia 

but in the longer term faced some serious 

challenges. We integrated capabilities 

across the organization to focus on the full 

value chain of the mining industry in four 

key areas – exploration, mining, mineral 

processing and metal production. Most importantly 

we wanted to focus on sustainability 

– how do we cope with low grades 

and more complex ores in terms of the implications 

for water and energy, and how 

do we make sure the industry is well linked 

beyond just the minerals industry into manufacturing 

and services. Almost Aus$15 

billion a year comes from Australia’s services 

to mining sector, so there is an enormous 

opportunity for us and it is a global 

opportunity. 

Assisting explorers 

“If exploration is not successful in the longer 

term the industry will not gr ow. With this 

in mind we try to ensure explorers working in 

Australia have access to the very best pr e- 

competitive data. We work closely with Geoscience 

Australia and the state surveys, and 

have worked with them on the AuScope 

GRID project. This is world-leading national 

data sharing infrastructure that enables data 

right across all geological surveys to be delivered 

in a seamless way.” Jonathan Law says 

the most r ecent initiative is delivery of an 

The ASTER map gives details on the surface mineralogy of the entire continent. Photo courtesy CSIRO. 

ASTER (Advanced Spacebor ne Thermal 

Emission and Reflection) map. “ASTER is satellite-borne 

technology that enables you to 

map the surface of the planet and particularly 

to make inferences about the mineralogy of 

the surface. Working with Geoscience Australia 

and the state and territory surveys we 

have produced an integrated map of Australia 

that shows for the first time the broad mineralogical 

variations across the country. It is 

very important for exploration and for a range 

of other things, such as water management, 

agricultural management and the impact of 

the mining industry relative to other industries. 

“The philosophy is to get people here, make 

them think Australia is prospective, give them 

the very best data for fr ee, provide effective 

exploration tools and let them loose to start 

exploring and be successful. As soon as we 

released this map, we had inquiries fr om 

other countries saying can you do this for us. 

It is technology we can export to other countries 

and we are happy to do that.” 

A technology the flagship is developing is 

called ReMoTe which addresses the problem 

of getting skilled people on mine sites 

for maintenance or repairs. Jonathan Law 

says having an expert on site at the right 

time is a challenge because you never know 

when you are going to strike a problem. “We 

have developed this technology involving 

the use of a camera on a hard-hat that lets 

you interact through video and sound with 

somebody in another city or anywher e you 

like over the internet. They can actually see 

what you can see in fr ont of you and they 

can, through a monitor on your side, point 

to what you should be doing. It pr ovides a 

real time interaction with someone who can 

visualize what you are doing and can direct 

you to undertake the repair.” 

Mineral processing technology 

In mineral processing the CSIRO has new 

technology based on ore sorting. Jonathan 

Law says it’s a way of measuring on a conveyor 

belt the mineralogical composition of 

ore which lets you do all kinds of smart things 

in terms of how you process that material. “It 

has been the holy grail of processing for quite 

some time but because of the volumes of 

rock passing through the big mines, we haven’t 

been able to deploy it in a useful way . 

We have developed a pr ototype instrument 

that can analyse a section of belt in a couple 

of seconds and let you make a decision 

about where it goes in the process route. This 

will have a big impact on the amount of water 

and energy used in processing because you 

are not using those resources on waste ma- 



terial. “Sensors and sensor technology ar e 

going to become more important, and a big 

opportunity for us is the use of real-time sensing 

to deliver the ‘digital r evolution’ to mining. 

There are all sorts of information we 

should be getting ther e in r eal time and 

should be making decisions based on it. 

“Also in processing we are keen to come 

up with technologies that let us exploit big resources 

that we know about but for whatever 

reason can’t be economically exploited. One 

of the big areas for this work is nickel laterites. 

In Australia about two-thirds of our nickel resource 

is nickel laterite but most pr oduction 

comes from sulphides, so sooner or later we 

have to make that transition. The Pacific Rim 

countries all have these nickel laterites which 

would benefit from new technology. One of 

the things that makes pr ocessing difficult is 

that they consume enormous amounts of 

acid when you try to leach the laterite which 

requires expensive capital equipment and involves 

high ongoing costs because that leaching 

must be done at a high temperatur e. 

Instead of using sulphuric acid we ar e working 

with Sydney-based company Dir ect 

Nickel to use nitric acid rather than sulphuric 

acid. The clever thing about this technology is 

that you can r eplenish the nitric acid and 

don’t have to keep bring in tonnes of new 

acid, which has a huge impact on operational 

costs and has the r eal potential to make 

some of the Australian nickel laterites competitive 

again. You also don’t have to do it at 

high temperature so you don’t have the big 

capital costs of having to build the containers 

for high temperature and pressure leaching. 

“We are working closely with nickel companies 

in this process, which,” he says, “is 

one of the underlying principles of the 

flagship – we want our technology to be relevant 

and used by industry. As soon as we 

possibly can in this type of work we get industry 

to come on board and co-fund the 

research but we also try to bring in a technology 

provider that can deliver the commercialized 

product. We can only have an 

impact if we work with companies to commercialize 

these technologies.” 

CSIRO Minerals Down Under Flagship director Jonathan Law. Photo courtesy CSIRO. 

Integrated steel production 

Steel production is a massive business globally 

but expensive in terms of water and 

energy use. A lot of the energy and reductant 

carbon comes from coal and Jonathan 

Law says the flagship has been working on 

an integrated suite of technologies deployed 

along the value chain of the steel 

business. “This concept starts with r eplacing 

a significant amount of the coal used 

in steel making with ‘biochar’ derived from 

agricultural crops or trees and using it as a 

renewable source of carbon. The big advantage 

of that is if you gr ow those trees 

or crops in the right place, you can help 

solve Australia’s salinity problem by lowering 

the water table. There’s a loop that can 

be developed that r eplaces greenhouse 

gas generating coal with non-gr eenhouse 

gas generating carbon from biomass. 

“Linked into that is a completely dif ferent 

technology looking at the other end of the 

steel-making process where they separate 

the residual slag from the steel in a molten 

bath and where the biggest volume is the 

slag, not steel. The slag is quenched with 

water and dumped, so it is a very wasteful 

process and the energy embodied in the molten 

slag goes into the atmosphere as soon as 

you pour water on it. W e have developed a 

process called dry slag granulation where the 



molten slag is dripped onto a spinning disc 

and then shot off in tiny droplets which precipitate 

in air. The solidified granules can then 

be used in cement making. There is no need 

to use water, and the ‘waste slag’ has a use. 

In addition, we also r ecover the energy stored 

in the heated air that has been cooling the 

droplets of slag and take it back into the 

steel-making process. 

Future challenges 

One of the challenges for the mining industry 

in the future, according to Jonathan Law, is 

that Australia is an expensive sour ce of labour, 

and just about everything else that goes 

into mining, so for Australia to remain globally 

competitive it has to improve its productivity. 

“This, in turn, is a challenge for the CSIRO 

and takes us down a route of automation and 

skills development so that we can maintain 

the fantastic infrastructure Australia has by attracting 

the very best people in the world and 

then keeping them in Australia. W e have a 

core role to deliver those things in the future.” 

He says the most important factor facing 

the industry into the futur e is community 

perceptions which play into politics, into 

funding and directly into the future of the 

industry. “CSIRO will continue to invest in 

Australia’s minerals industry as it r emains 

broadly supported by the community, and 

a valued part of the national economy . 

Sharing the risks and benefits of the r e- 

source business is an area in which we, as 

an industry, have to do better. Being a nationally 

funded flagship, I see that as an important 

role for us to play - discussing the 

impacts of the mining industry and how we 

can do that better, and talking to all stakeholders. 

One of our major activities is ‘mineral 

futures’ which is all about leading 

thinking in what technologies will make a 

difference in the futur e, how will people 

perceive those technologies, how do different 

stakeholders in the community want 

us to proceed with R&D around the minerals 

industry and how can we link in with 

things like manufacturing, which is going 

through very har d times. W ouldn’t it be 

great if we could have a manufacturing industry 

that leverages off our strength in minerals 

and starts to build mineral-r elated 

products that we could send of f-shore. In 

this way when Australia runs out of minerals, 

we have something else and are a global 

leader in manufacturing and services. 

“Sliding commodity prices ar e another 

challenge for the industry,” he says, “and 

these are beyond our control, but generally 

speaking as commodity prices fall, companies 

are less inclined to co-invest with 

us, particularly with longer term R&D, as 

they focus on the short-term. We can’t afford 

to operate as solely an Australian r e- 

search entity – we have to work with the 

big players all over the world. This is a 

challenge for us – how do we take the Australian 

expertise and work with the very 

best overseas without giving away the family 

farm in the process.” 

The amount of money being spent on 

greenfields exploration is declining at an 

alarming rate, Jonathan Law says, so not 

only is there less money available for juniors 

but they ar e not spending on gr eenfields 

exploration in Australia and ar ound 

the world because brownfields exploration 

is cheaper and more likely to provide quick 

success. “We put a lot of ef fort into technology 

to help with greenfields exploration. 

If we can drag people out of br ownfields 

areas and into new areas, those are where 

the big wins will be.” 

World technology leader 

He says in many ways Australia is leading the 

world in mining technology because some 

others that were leading dropped the ball – 

think of the dramatic changes in historically 

major industry players including the UK, 

and parts of the US and Eur ope. 

“These places had str ong R&D 

cultures and strong minerals industries 

but when the community 

tide turned against 

those industries, the infrastructure 

that went 

with it lapsed – the services 

and R&D – so 

there is a lesson for 

Australia. The other 

fundamental is that 

Australia has a long history 

of mining which 

has allowed it to build 

up a credible R&D portfolio 

and take a leading 

role as others have dropped 

off. The Federal Government 

has also played a major role because 

they have been prepared to 

support the industry with ventures such 

as the CSIRO and CRCs (Cooperative 

Research Centres) where money is put 

into longer term challenges with a clear focus 

on practical research outcomes. 

“The industry has also got its act together in 

Australia in a way that no other country has 

been able to do – through AMIRA International, 

an industry funded collaborative research 

vehicle – which has enabled companies to 

come together and work on shar ed problems. 

We can probably do even more and 

focus on bigger things as a collegiate gr oup 

of industry people. This goes back to the 

community opinion on mining – if the industry 

is seen to be out there investing in its own future, 

that can only be a positive thing for the 

entire industry because not only does it get 

the benefits from the R&D but it demonstrates 

that it’s an industry that thinks about its 

future, that has a future in Australia and is prepared 

to put its money behind that.” 

Jonathan Law sees Australia’s role in mining 

technology growing into the futur e. “We 

would be crazy to let it die. There’s a fantastic 

opportunity for us to grab and there are competitors 

such as Canada, Latin America and 

Africa who are also in this space, but I don’ t 

think they are as well positioned as we are. I 

think there is a big future in R&D and particularly 

around the commercialization of R&D, 

which in the longer term is wher e the real 

money is going to be for the nation - so we 

really need to nurture that.” 

A tectonic image from the AuScope GRID project. 




Technology drives improved productivity 

AUSTRALIAN mining relies on technological 

innovation to drive improved productivity, according 

to Australian Minister for Resour ces 

and Energy Martin Ferguson. Speaking at the 

opening of BASF’s global mining r esearch 

and development centre at the Australian Minerals 

Research Centre (AMRC) in Perth, Western 

Australia, Martin Ferguson said BASF’s 

research would thus contribute to the global 

competitiveness of the Australian mining industry, 

helping to maximize r eturns to the 

community and shareholders. 

BASF is the world’s leading chemical company 

and its new facility will allow its scientists 

to study specific innovation needs for 

mineral processing and metal production, to 

help reduce energy and reuse water at mines 

in Australia and around the world. 

BASF SE vice chairman Dr Martin Brudermueller 

said at the opening: “Chemistry is a 

key enabler to making tomorrow’s mining industry 

more sustainable. With the latest advances 

in mining solutions research, BASF 

aims to help mining operations to minimize 

Australia’s Minister for Resources and Energy Martin Ferguson (right) and BASF SE vice chairman Dr Martin 

Brudermueller officially open BASF’s global mining R&D centre in Perth. 

water consumption, maximize recovery, reduce 

land areas consumed by tailings disposal 

and minimize the cost and time 

required to rehabilitate sites.” 

The AMRC site is part of the CSIRO, Australia’s 

national science agency and one of 

the largest and most diverse research agencies 

in the world. With a team of six advanced 

material researchers at the BASF centre 

by the end of 2012 and about 20 r esearchers 

over the next five years, focus topics 

will include advanced rheology modifiers for 

the improvement of the thickening process 

for valuables and tailings, as well as modification 

of the crystallization pr ocess in alumina 

production. 

“High quality or es are becoming depleted 

and new mines ar e often in hostile locations 

while environmental, health and safety regulations 

are becoming more stringent. BASF aims 

to help the industry face these challenges with 

solutions across our customers’ value chain. 

This new research and development centre will 

further develop our expertise in ar eas, which 

are crucial to meeting futur e needs,” said Dr 

Steffen Kudis, head of BASF’s Global Oilfield 

and Mining Solutions businesses. 

Extracting value from slag By Tony Heselev 

A NEW technology piloted recently by CSIRO 

has the potential to derive significant value 

out of molten slag that is a by-pr oduct of 

steelmaking. Dry slag granulation could deliver 

significant benefits to the steel industry 

globally by capturing waste heat, slashing 

water use and gr eenhouse gas emissions, 

and producing ‘green’ cement. 

A steelworks producing one million tonnes of 

steel a year generates 200,000–300,000 tonnes 

of slag. In some blast fur nace operations 

the slag is cooled naturally and sold for r oadworks 

after crushing and screening. Others use 

a ‘wet’ or water-quenching process to produce 

granules for cement production. 

This process significantly r educes greenhouse 

emissions but uses a lot of water . It is 

estimated that for every tonne of molten slag 

processed, 1–1.5 tonnes of water evaporates. 

Water granulation can also cause acid mist and 

air pollution. Neither the naturally cooled or wet 

process recovers the large amount of high 

grade heat in molten slag. Some 1.8 gigajoules 

of heat per tonne of slag are lost when it cools 

from about 1500°C to ambient temperature. 

Slag is poured onto a spinning disc and broken 

up into droplets. Photo courtesy CSIRO. 

Dry granulation also saves the water that 

would have been lost to the atmosphere, estimated 

at up to 60 gigalitres a year. This process 

produces a ‘glassy’ product that is ideal 

for cement manufacture. At the same time, 

the waste heat is captured and can be used 

onsite for drying, preheating, or steam and electricity 

generation. 

This heat recovery would save about 800 petajoules 

of energy per year and r educe the 

world steel industry’s greenhouse gas emissions 

by about 60 million tonnes per year . Dry 

granulation also saves the water that would 

have been lost to the atmospher e, estimated 

at up to 60 gigalitres (billion litres) a year for the 

steel industry globally. CSIRO’s dry granulation 

project leader Dr Dongsheng Xie says, “This 

process would make a fundamental change in 

slag treatment in terms of both sustainability 

and full value recovery.” 

The concept has been proved in a semi-industrial 

pilot plant that pr ocessing 100kg of 

slag per minute. CSIRO is working with international 

engineering companies on the next 

stage, industrial scale piloting, involving processing 

1 tonne of slag per minute. 



Proof of concept for CSIRO’s pyrolysis 

plant is expected in late 2012. 


A vision in charcoal By Tony Heselev 

THE Australian steel industry has been hit 

hard by the high dollar, rising raw material prices 

and low cost imports. Technologies developed 

by CSIRO and its industry partners 

could set the industry on a new, low emissions 

path. An integrated and visionary pr o- 

cess that would r educe greenhouse gas 

emissions in steelmaking could help r evive 

the industry in Australia while providing significant 

opportunities for other businesses. 

The process, developed by CSIRO and industry 

partners, could mor e than halve the 

steel industry’s greenhouse gas emissions 

without increasing production costs. It would 

also produce valuable by-products and enable 

the industry to make ‘carbon lite’ steel, 

differentiating it from other producers including 

low cost importers. 

The process is driven by two technologies 

- partial r eplacement of coal and coke in 

steelmaking with greenhouse gas neutral, renewable 

charcoal, and recovering waste heat 

through dry granulation of slag. 

CSIRO and its industry partners, BlueScope 

Steel and OneSteel, began working on the 

technologies in 2006 in a project that has cost 

$12 million so far. Assuming 10–13% market 

penetration by 2030, a leading pr oject management 

and engineering consultancy has estimated 

that these technologies have a potential 

risk-adjusted net present value of $42 billion. 

The Australian iron and steel industry produces 

about six million tonnes of steel and 14 million 

tonnes of greenhouse gases (mostly carbon 

dioxide) a year. This is about 2.5% of Australia’s 

total annual emissions. Most of the ir on and 

steel industry’s emissions occur during production 

of iron in the blast furnace, where coal and 

coke are used as fuel and reductant. 

CSIRO and its partners found that between 

32 and 58% of coal and coke used for integrated 

iron and steelmaking could be r eplaced 

by char coal without substantially 

modifying the steelworks. This would lead to 

a significant reduction in net greenhouse gas 

emissions produced by the industry. 

As part of the integrated steelmaking pr o- 

cess, charcoal would be produced by using 

pyrolysis to dry and heat biomass sour ced 

from tree plantations and residues from forestry, 

agriculture and wood processing. Pyrolysis 

is an oxygen-free system that works (at 

temperatures above 300oC) in a similar way 

to a home oven. Different products are generated 

depending on the type of biomass feed 

material, how fast the biomass is heated and 

to what temperature it is heated. 

This technique creates ‘designer biochar’, 

so called because different types of charcoal 

can be made to meet the demands of the 

eight potential applications involved in steelmaking. 

Charcoal can have similar properties 

to coal in that it contains carbon, ash and volatile 

matter, can be very r eactive and when 

required, can be made dense and strong. 

Dr Sharif Jahanshahi, who leads the CO2 

program for CSIRO, says, ‘Just as oils ain’ t 

oils, charcoals ain’t charcoals. Depending on 

the application r equired, the char coal properties 

can vary. “In some cases, you may 

want to grind the charcoal into very fine powder 

because you want to inject it with air/oxy- 



gen through a little nozzle and burn it. So you want it to be very r eactive, 

easy to grind and contain 10–20% volatile matter. In another case, 

you may want it to be the complete opposite – very low in volatility and 

dense so that it doesn’t introduce hydrocarbon and moisture, because 

this is detrimental to steel.” 

Work on each of the applications is being progressed, from laboratory 

to pilot scale and then to full demonstration (industrial) scale. 

Three have been successfully piloted, of which one has gone to fullscale. 

Dr Jahanshahi expects many of the applications to reach the 

demonstration stage by 2015. 

The biggest application with the largest greenhouse ‘gain’ is the 

injection of pulverized charcoal into the blast furnace. This was successfully 

laboratory tested by BlueScope Steel in Newcastle about 

two years ago. Dr Jahanshahi says it showed superior r esults to 

coal and he is confident that with support from industry, it will lead 

to a successful demonstration project. 

A novel pyrolysis process to convert biomass into char coal, 

which CSIRO is developing at its onsite pilot plant in Clayton (Melbourne), 

also produces some valuable and carbon neutral by-products. 

These include bio-oil and hydrocarbons that could be used 

to produce green electricity, plastics and liquid fuels. Capturing 

and maximizing the value of these by-products will be essential in 

making charcoal an economically viable alter native to coke and 

coal in Australia. 

Pyrolysis of wood is an ancient technique but no technology 

exists to make very large quantities at a low enough cost. The pilot 

plant needs to demonstrate low capital costs, be able to process inexpensive 

woody materials efficiently and operate continuously with 

low emissions and high yield. 

The pilot plant operates at 100kg of biomass per hour and is designed 

to r ecover bio-oil and other by-pr oducts using its own 

energy (autogenously). Proof of concept is expected in the second 

half of 2012, with scale-up and demonstration to follow. The aim is 

for the plant to be scaled up to the tonnage required for some applications 

within the steel industry – up to 50 tonnes per hour. “The 

pyrolysis process needs to be versatile enough to be a modular 

plant next to the biomass resource or a giant plant providing charcoal 

next to the blast furnace,” Dr Jahanshahi says. 

Biomass materials used to cr eate charcoal will come from sustainable 

sources rather than native forests, and are considered to 

be carbon neutral. Substituting these materials for coal-based fuels 

and reductants used in iron and steelmaking reduces the industry’s 

net CO2 emissions without the need for major capital expenditure. 

In a carbon-constrained environment this is good news for the industry 

and it could minimize its liability for the carbon tax. 

BlueScope Steel’s environment manager Andy Purvis says, “W e 

see this project as one opportunity to make a potentially significant 

breakthrough improvement in our direct emissions, by replacing 

coal with greenhouse neutral and renewable charcoal. It could be 

the right solution for the Australian steel industry without us having 

to spend hundreds of millions developing entir ely new processes 

or building a new plant. Other parts of the world will develop their 

own solutions that work for them, but the ‘designer biochar’ concept 

could be the right technology for Australia, making the most of 

the advantages and characteristics of the country we live in.” 

The availability and supply of biomass in Australia, with its relative 

abundance of fertile land, rainfall and sunshine, makes it a practical 

solution for the local steel industry. 

Mark Glover, of Eco Waste, a Sydney-based sustainable resources 

and waste management consultancy working on the pr oject, 

has been examining the business case for supply of biomass material 

on the east coast, wher e most of Australia’s steelworks are 

located. He says sufficient forest, agriculture and woody residues 

exist on the east coast to convert into char coal and meet the potential 

demand of the Australian steel industry . He estimates that 

three million tonnes a year of finished charcoal could be produced 

from these materials within 10 years. 

He says that the market for biomass is taking off because of the 

issues around carbon liability, and competition for biomass supply 

will escalate. “But the steel industry must do it pr operly if it wants 

to develop a sustainable marketplace.” An ‘easing in’ is r equired, 

with biomass first being used for relatively straightforward applications 

in steelworks. 

In the short-term, it is envisaged that urban waste streams and forestry 

residues can meet 45% of potential demand, before ramping 

up with the remaining 55% coming each centre could run a continuous 

pyrolysis process, requiring about 20 fulltime employees, according 

to Mark Glover. 

For BlueScope Steel’s Andy Purvis, the key challenges ar e to 

prove up the technology at an industrial scale and develop a reliable 

and cost competitive supply chain for charcoal. “If we can overcome 

these challenges, the early signs are that the value and use 

of charcoal could be an excellent substitute material for coal and 

coke, especially if and when the carbon price goes higher.” 

- This article originally appeared in CSIRO’s ‘resourceful’ magazine. 



Marand Precision Engineering’s 

steel wheel set assembly line. 

Automation technology takes Marand to the top 

ONGOING state-of-the-art, industry-leading 

automation work in the aeronautical and automotive 

fields as well as incr easing involvement 

in the rail and mining ar eas has led to 

Melbourne-based Marand Pr ecision Engineering 

being named Victoria’s Manufacturer 

of the Y ear (Large Business) for 2012. 

Marand was selected by industry experts 

against criteria including export performance, 

enabling technologies utilized, innovation in 

manufacturing, quality management and sustainable 

practices amongst others. 

Marand has 44 years of accumulated experience, 

knowledge and success as an innovative 

engineering company in a number of 

sectors including aerospace, defence, rail, automotive, 

mining and energy but, according to 

its managing director David Ellul will not be 

resting on its laurels. It aims to increase its influence 

in aerospace, where it is Australia’s largest 

supplier on the F-35 Joint Strike Fighter 

program, as well as in the mining sector , 

through technological advances in the maintenance 

of ore cars and locomotives. 

Marand’s list of achievements on the F-35 

include being the first supplier in the world 

approved to manufacture large finished aerospace 

tools for BAE Systems, UK, and being 

the global sole source of the engine removal 

and installation trailer for the world’s first 5th 

generation stealth fighter. Marand has won 

three consecutive Lockheed Martin Excellence 

awards in quality and delivery perfor - 

mance for shipping in excess of 500 tools 

around the globe for the F-35 program. 

Marand is also supporting Australia’s mining 

boom. All 32,000 or e car and locomotive 

wheels which transported Rio Tinto’s 223 million 

tonnes of iron ore in the Pilbara in 2010 

were re-profiled by machines designed and 

manufactured by the company. Marand also 

supplies rolling stock maintenance equipment 

to BHP Billiton, Queensland Rail, Pacific National 

and Fortescue Metals. 

Marand focuses on manufacturing innovation. 

It designed and manufactur ed the 

world’s first tidal turbine that was connected 

permanently to the power grid, which is in the 

channel between San Remo and Phillip Island, 

Victoria. It was also the primary Australian 

company to work with Boeing 

Aerostructures Australia on the design, manufacture 

and integration of its 787 carbon 

fibre manufacturing facility. 

The company’s growth is reflected in the fact 

that it is establishing a new plant in Geelong, 

Victoria, later this year to complement its existing 

Moorabbin plant and to enable it to better 

focus on development of its existing business 

arms in the rail, mining, aerospace and defence 

areas. David Ellul says Marand built its exper - 

tise around the automotive industry with the 

company founded 44 years ago by his father 

but as that industry fell on har d times, the business 

diversified into aerospace work and then, 

via acquisition, into rolling stock maintenance. 

“Our expertise has been in automation, material 

handling and automating processes firstly in the 

car industry and then into other areas. Our customers 

are all global ‘blue chip’ companies 

such as Ford, GM, Toyota, Boeing, Lockheed 

Martin and BAE Systems because they are the 

ones with the big infrastructure and that require 

the automation expertise we provide. 

“As the automotive industry began to 

struggle, we had to find opportunities to use 

our machine tool and automation expertise,” 

he says. About 10 years ago we identified a 

100-year-old machine tool company in the UK 

that was supplying equipment for the maintenance 

of trains but had fallen into receivership. 

We could see the opportunity because the rail 

maintenance business was r eady for the 

change we could provide, so we purchased it, 

ran it out of the UK for a couple of years and 

then relocated most of the business to Australia, 

leaving service only in the UK. 



Marand is developing equipment and products to keep the rail wheels on tracks for longer. 

“It took about two years for us to re-position 

the business and get our products right before 

we went to the market and targeted the mining 

industry where there is demand for efficient rolling 

stock equipment. We have grown this part 

of our business and export equipment into 

Saudi Arabia, India and China but our main 

focus is Australia. W e have taken the basic 

maintenance equipment that came with the 

purchase of the UK business and updated it as 

much as possible to cater for the demands of 

the mining industry, to provide increased productivity 

in getting product from the mines to 

port and to impr ove safety by r educing the 

need for human interaction with the heavy 

equipment associated with the work. 

“We try to be the complete maintenance 

workshop provider by becoming involved at 

early stages starting with feasibility studies, 

project definition, project costing and then 

on to the design and manufacture, so it is a 

total automation package, not a specific 

piece of equipment. We have done this in 

the automotive industry, in aerospace and 

are doing it with rail. It is becoming more acceptable 

across all industries that automation 

is the way to do things, but it has taken 

time and a lot of ef fort to reach this stage. 

There is still some way to go but companies 

are starting to realize automation can help 

throughput and ease the cost pressures associated 

with labour-intensive work.” 

In the future David Ellul sees more growth opportunities 

to service mining, firstly through the 

provision of a total rail package to make this 

vital part of the mining chain as eficient as possible. 

“This includes development of pr oducts 

to keep the wheels on tracks for longer . We 

have the potential to do other work in the mining 

area outside rail and part of our strategy is 

to develop this, particularly with large engineering 

and fabrication projects that need to be 

made in-country and that need capability. We 

work well with the mining companies in the rail 

space and are at present installing major infrastructure 

for Pacific National, including large 

loco turntables and underfloor. Additionally this 

year we deliver ed multiple wheel & bearing 

presses and other testing equipment for brakes 

and wheels. 

Marand employs about 260 staff, the majority 

in Melbourne but with some in the UK involved 

in rail maintenance and aer ospace. 

The company has another site in Airport 

West, near Melbourne’s Tullamarine Airport, 

where there are about 40 people on site but 

this plant is being r elocated to Geelong. 

David Ellul says, “This was an aer ospace 

component manufacturer purchased around 

12 months ago to assist with the aer ospace 

and air defence work. It was pur chased because 

we needed extra capacity for the expanding 

business Marand has.” 

More business intelligence for miners 

AUSTRALIAN mining companies dominate 

the search for natural resources in many parts 

of the world, and the domestic industry is the 

leading supplier of metals and minerals to the 

booming Asian economies. 

The world’s leading supplier of market intelligence 

to this sector is also Australian, and 

Perth-based Intierra has in the last 9 months 

expanded its global lead with the acquisition 

of Stockholm-based Raw Materials Gr oup 

(RMG) and the metals consultancy and commodity 

reports of London-based Bloomsbury 

Minerals Economics (BME). 

One key to the RMG database is that it 

tracks full material flows, not just ore production, 

so is ideally suited to identifying market 

opportunity for equipment suppliers. 

RMG is led by Professor Magnus Ericsson, 

and much of the company’s research has involved 

market studies and analysis of exploration 

and mining activity. RMG has also a 

great depth of experience in conducting mineral 

economics policy studies for African 

and Scandinavian governments. 

The acquisition of the base metals consulting 

and copper reports division of BME extended 

Intierra’s range of services to include 

highly respected supply-demand market 

analysis, mine pr oject appraisal, and a 

monthly and quarterly copper report. 



Mining Information Systems enhancements 

MINING Information Systems (MIS) has 

added new tools to its MISWeb Control Platform 

that enhance usability and ef ficiency. 

The OLAP cube viewer (Scout) and a dashboard 

reporting tool (Focus) that both provide 

clear, crisp graphics and data visualizations 

together with strong analytic capabilities. 

The MISWeb Control Platform is a highly 

scalable, enterprize wide data and application 

end user portal. This portal also provides 

a data analytics suite of web applications that 

brings sophistication with simplicity in a synergistic 

web-based interface for navigating 

MIS applications or consuming Micr osoft 

Analysis Services OLAP cubes. 

MIS is a team of mining and information system 

specialists who have mor e than 100 

years of total experience in the mining and resources 

industries. The MIS team has implemented 

data management and r eporting 

systems specific to the mining industry at a 

large number of surface and undergr ound 

mines around the globe. MIS of fices are in 

Perth, Australia and Denver, USA, with planning 

of an African based ofice well advanced. 

There are more than 40 installations of the 

MIS product range (MMRS and WMRS) in Africa, 

Australia, North and South America and 

Canada. The systems, or modules ther ein, 

have been used as a primary data r eporting 

and management tool in the mining of a number 

of commodities, including coal, copper , 

diamonds, gold, ir on ore, mineral sands, 

nickel, tantalum, uranium and vanadium. 

The Mine Management Reporting System 

(MMRS) has at its core the strong, flexible and 

multi-faceted, genuinely global database 

model that is not constrained by language, 

time zones, unit of measure, currency, organizational 

structure or commodity mined. 

The system has been designed and developed 

to be implemented in a modular fashion, 

facilitating a staged deployment 

strategy that simplifies on-site user training 

and acceptance. MMRS modules corr e- 

spond to all the functional areas of a mining 

operation including load & haul, drill & blast, 

product & stockpile tracking, fuel system 

management, fixed plant and crushing, geology, 

grade contr ol and performance to 

physical or financial plans, for ecasts and 

budgets. The systems contain full featur ed 

data analysis Cube cr eation and built in 

analysis and dash-boarding tools using familiar 

drag and drop technologies. 

The Workforce Management Reporting System 

(WMRS) also utilizes a genuinely unconstrained 

global database model allowing the 

same application to be deployed using many 

languages, time zones and currencies. WMRS 

modules correspond to all the functional areas 

of safety and incident management including 

incident recording, incident assessment, analysis 

and investigation, outcome and action 

management, risk management, training & 

competencies and automated notifications. 

Transmin’s Rocklogic wins innovation award 

MATERIALS handling company Transmin has 

taken out the innovation category in the 21st 

Annual Western Australian Information Technology 

and T elecommunications Awards. 

Transmin’s Rocklogic, a rockbreaker automation 

system, was one of 27 finalists for the 

awards, which recognize companies and individuals 

at the cutting edge of technology innovation 

and the r ole they play within this 

industry on a global scale. 

The company says improving mine safety 

Rocklogic provides safety integrated remote operation, collision avoidance and automated parking technology 

for rockbreakers. 

and efficiency are the main goals behind the 

intelligent automation system, designed in response 

to increasing industry demand. Rocklogic 

is the only automated system applied to 

hydraulic boom and hammer assemblies 

used to reduce the size of material in crushing 

operations at hard-rock mine sites. 

Rocklogic is an Australian-engineered technology 

that provides safety integrated remote 

operation, collision avoidance and automated 

parking technology for rockbreakers. Transmin 

says the system impr oves mine site safety 

by eliminating hazards to site personnel. 

Transmin’s senior engineer Dr Adrian Boeing 

presented the Rocklogic system at the Collision 

Avoidance in Mining Conference in Brisbane, 

earlier this year. “Remote operation protects the 

operator’s health by removing them from exposure 

to dangerous mining conditions, allowing 

them to operate the equipment from a safe office 

environment,” he said. “This can either be 

on site or at a city-based contr ol room where 

operators can control several rockbreakers at 

different sites around the state. 

“Our collision avoidance technology significantly 

increases safety and eliminates downtime 

and maintenance costs fr om collisions. 

Operators also feel more confident knowing a 

collision system is protecting them, and this 

improves their operating speed and eficiency. 

The system can also be integrated with industry 

standard fleet management systems to 

avoid collisions with vehicles. Rocklogic’s fault 

tolerant dedicated emergency shutdown system 

is customized to each site’s needs and 

ensures the health and safety of all surr ounding 

personnel,” Dr Adrian Boeing said. 



Screen motion analyzer to save coal industry millions 

AN Australian innovation in portable screen 

motion analyzers is set to save coal producers 

millions of dollars each year in lost 

production. Ludowici Australia’ s new 

screen motion analyzer checks vibrating 

screens are operating correctly by assessing 

vibrating stroke, lateral displacement 

and operating frequency. These are the parameters 

to ensur e screen performance 

and efficiency are optimized. 

Ludowici developed the commer cial product 

from a prototype after the concept was 

first initiated a decade ago by CSIRO Energy 

Technology under a Coal Association r esearch 

program to improve preparation plant vibrating 

screen performance. The r esulting 

analyzer is lightweight and portable. 

The screen motion analyzer is user-friendly, 

does not require specialist training to operate 

and can be used safely without impacting 

production. It is fixed to the screen using magnets, 

records vibration simultaneously in 

three directions (horizontal, vertical and lateral), 

and sends vibration data to a Smartphone 

via Bluetooth. The unit calculates and 

displays screen operating frequency, vibrating 

stroke and lateral displacement (pk-pk), and 

can save files for further analysis. 

This portable screen motion analyser from Ludowici 

Australia is set to save the coal industry 

millions of dollars each year. 

CSIRO Energy Technology project leader 

Mike O’Brien says previous methods of measuring 

strokes and driven frequency – stroke 

cards and stroke gauges – were not reliable. 

“The stroke of the screen is important as it relates 

to the screen’s capacity to move material 

from the inlet end to the discharge end. If 

this movement is not linear, it can cause hold 

up issues and material surging. “Uneven distribution 

of the feed onto the screen deck can 

cause a deviation in the motion acr oss the 

screen, leading to higher scr een wear. If the 

frequency of the screen drifts is too close to 

the natural screen frequency, then catastrophic 

failure can occur.” 

Ludowici’s general manager of engineering 

Rob Angus says the screen motion analyzer 

will prove invaluable to the coal industry by giving 

mines the ability to check the operation 

of their screens and feeders more regularly. 

“This will improve machine operation as well 

as reducing the risk of damage due to incorrect 

operation. Repairing screens is a timeconsuming 

process which impacts on coal 

production and, at up to $500,000 each, replacing 

screens can also be expensive.” 

The company is getting a lot of interest and 

very positive feedback from the industry, confirming 

the device is user-friendly and able to 

be operated without great levels of expertise. 



Pitram Optimum implemented in Ghana 

MICROMINE has successfully implemented 

its mine control and management reporting 

solution, Pitram Optimum, at Gold Fields’ Damang 

gold mine in Ghana. MICROMINE says 

Pitram will help the operation to increase production, 

reduce costs, and impr ove safety 

and business intelligence capabilities. 

Damang is an open pit gold mine in southwest 

Ghana at which Gold Fields annually 

processes 5.1 million tonnes annually from a 

blend of approximately 37% oxide or e and 

63% fresh ore. The current planned depth of 

the Damang pit is 300 metr es and it is estimated 

that the current mineral reserve will be 

depleted by 2019, although exploration work 

indicates that the life of mine could be extended 

if additional projects are approved. 

Gold Fields’ FMS and pr ojects supervisor 

Barrett Blaauw says, “Pitram was selected 

because of its ability to integrate the production 

planning and optimization pr ocess into 

the real-time environment. The software went 

‘live’ in February 2012. 

“The biggest hurdle for us has been convincing 

operators in the field to utilize the new 

software to their advantage. Fortunately, an 

increasing number of miners in Africa are experiencing 

the benefits that automation solutions 

such as Pitram provide.” 

MICROMINE’s Pitram Optimum in operation at night at the Damang pit cut back in Ghana, West Africa. 

Barrett Blaauw says he is optimistic about the 

African mining sector’s future. “Both our Ghanaian 

mines have ambitious expansion plans 

which could extend their lives. A strong fleet is 

essential to our current and future operations. 

Damang has 22 automated vehicles and using 

Pitram Optimum, we plan to automate a further 

12 vehicles within the next few months.” 

Pitram Optimum is one of four solutions that 

comprise the Pitram product suite. The Pitram 

suite provides a unique upgrade path from the 

entry level Pitram Report solution, thr ough to 

the fully automated Pitram Optimum Solution. 

MICROMINE’s South Africa general manager 

Marc Ramsey says, “Because Pitram Optimum 

integrates production planning and optimization, 

Damang will see a significant improvement 

in the execution of mine plans and the maximization 

of asset utilization and efficiency. Damang 

management will be able to compar e 

actual findings against plans, and have the ability 

to correct deviations from plans. 

“Also, through intuitive equipment allocation, 

Damang can optimize pr oduction, reduce 

wait time and execute shift plans 

according to design or blending r equirements. 

This will allow business targets to be 

achieved at the lowest possible cost.” 

MICROMINE advises on coal data standards project 

MICROMINE, a leading provider of intuitive 

software solutions to the mining and exploration 

industry, has again positioned itself at 

the forefront of technical geological development 

through its involvement in a coal 

data standards project, which resulted in 

the recent release of ‘CoalLog’ Version 1, a 

Borehole Data Logging Standar d for the 

Australian Coal Industry. 

The standards were initially developed by 

senior GeoCheck staf f Andries Pr etorius, 

Gary Ballantine and Brett Larkin, followed 

by the collaboration of major mining and 

software companies. MICROMINE’ s Geobank 

data management specialist Ibo 

Mango has been a member of this collaborative 

panel since its inception. Early involvement 

in this pr oject, titled the ACARP 

Project C21003, has enabled MICROMINE 

to invest considerable time in the development 

phase of producing a solution to meet 

the requirements for Borehole Data Logging 

Standard for the Australian Coal Industry. 

Over time, data formats and coding sheets 

have been integrated into the technical workings 

of geological r ecords. In some instances, 

more than 30 different data formats 

are used and more than 100 different dictionaries 

for the Australian coal industry . Consequently 

data is often flawed, leading to 

numerous inconsistencies. There has been 

considerable pressure on the industry for this 

data to be standardized and a Coding Standard 

to be established. 

Commenting on his involvement Ibo Mango 

says, “Being involved in the coal panel is really 

important to me, like so many of my colleagues, 

as for so many years my coal r elated 

work has been dependent on so many variable 

factors. Depending on the data format 

and dictionaries in use, my findings have varied 

considerably from company to company, 

making work extremely frustrating at times. 

“The best thing about this Coal Standard is 

the benefits it can pr ovide to our clients. A 

universally consistent system will not only be 

more transferable within the industry , it will 

also enable us to record and manage higher 

quality and more accurate borehole data. We 

are excited to be driving this data standar - 

dization improvement and being able to pass 

this new standard on to our clients.” 

MICROMINE’s Geobank consulting team is 

offering the new coal data standards as part 

of its current client software implementations 

and is currently in the process of implementing 

this solution for various clients. 



ATMOS-5D+ and DustAlert+ 

New global benchmark on dust control and management 

MORE stringent environmental standards and 

increasing public awareness of key environment 

issues in recent years have inspired the 

mining industry to implement mor e efficient 

‘beyond best practice’ dust contr ol technologies. 

Global air quality consulting company 

ATMOS Global (ATMOS Australia Pty Ltd - 

Elite Atmospheric Air Quality Modelling & Forecasting 

and Climate Change Resear ch 

Consultants) focuses on innovation and technology 

which, together with their goal to be 

the air quality forecasting industry’s innovative 

leader on a global scale, fuels their ability to 

combine the art and science of dust impact 

forecasting to constantly develop new and innovative 

dust management technologies. 

This has enabled the company to develop 

ATMOS-5D+ and DustAlert+ which allow 

mine site operators to enjoy financial benefits, 

including less manpower, less water, less 

energy, etc, as well as time-saving benefits. 

ATMOS Global’s ATMOS-5D, ATMOS-5D+, 

Dust Alert and Dust Alert+ are energy efficient 

platforms using renewable energy and carbon 

offsets in the process of generating and 

disseminating daily the site specific dust impact 

forecasts and alerts. 

DustAlert+ is the world’s first ‘artificial intelligence 

multi-factor, multi-criteria dust impact 

early warning system’, which ATMOS Global 

says is a new generation, self-awar e, selflearning 

and self-adapting ever present sentinel 

that offers continuous dust protection for 

the full spectrum of mineral exploration, extraction 

and processing operations. DustAlert+ 

is the new AI enhanced version of 

ATMOS Global’s innovative multi-channel 

early warning system DustAlert, a support system 

for ATMOS-5D+. 

ATMOS-5D+ is the world’s first ‘integrated 

5D global and site specific dust impact for e- 

casting and management platform for mine 

haul road dust control’. ATMOS-5D+ is the 

new dedicated version (for mine haul road dust 

control) of ATMOS Global’s innovative system 

ATMOS-5D, the first-of-its-kind risk-based 

dust management and control platform. 

ATMOS Global’s global president and chief 

executive officer Dr Or estis Valianatos says 

that ‘DustAlert+ and ATMOS-5D+ work in synergy 

and interconnected with the operations 

Western Areas’ Spotted Quoll project has reduced dust deposition by 24.2% (while production has increased by 

44.3%) by using ATMOS Global’s ATMOS-5D and DustAlert advanced dust impact forecasting systems. Over the 

same period production at the project has increased by 44.3%. 

Western Areas’ Flying Fox mine uses the comprehensive and timely DustAlert+ and ATMOS-5D+ dust impact 

forecasts to control and manage fugitive dust emissions well before they are predicted to occur’. 

they protect to issue customized and intuitive 

early warnings (a few days in advance) to control 

and manage fugitive dust emissions (before 

they occur) for operations specific to the 

mining, manufacturing and energy industries. 

“ATMOS-5D+ and DustAlert+ mark a new 

era in the understanding of dust management, 

Dust Management 5.0, a concept introduced 

for the first time anywher e in the 

world by ATMOS Global on June 21, 2012,” 

he says. “DustAlert+ and A TMOS-5D+ provide 

the fail-safe infrastructure that supports 

the forecasting activities of ATMOS Global’s 

world’s first Centre for Global and Site Specific 

Dust Impact For ecasting, Management 

and Control for the Mining Industry’. In general, 

due to the complex nature of mining operations, 

it is impractical to addr ess, in an 

ad-hoc manner, unfavourable dust impacts 

that may happen in different locations at the 

same time. Using ATMOS-5D+ and DustAlert+, 

mine operators can shift their dust management 

strategies from a reactive (‘monitor 

→ respond’) to a proactive (‘plan → act’) effective 

approach, thus dealing with potential 

dust control issues before they happen,” Dr 

Orestis Valianatos says. 

Evidence of the effectiveness of these systems 

comes with mining company Western 

Areas and ATMOS Global being jointly nominated 

by the Western Australia Department 

of Mines and Petr oleum as finalists in the 

2011 Golden Gecko A wards for Envir onmental 

Excellence for implementation of 

ATMOS-5D at the Spotted Quoll (T im King 

Open Pit) project, which is part of the Forr e- 

stania Nickel Project 400km east of Perth. 

ATMOS-5D and DustAlert+ wer e instrumental 

in assisting Western Areas reduce the 

annual (total) dust deposition recorded at the 

location of an envir onmentally sensitive receptor 

in close proximity to the open pit by 

24.2% (all factors considered) while the annual 

(total) ore mined increased by 44.3% for 

the Spotted Quoll site from 2010 to 2011. 

ATMOS-5D+ reliable and timely dust for e- 

casts and DustAlert+ early war ning messages 

are used daily by W estern Areas to 

automatically anticipate and optimally control 

potential dust impacts, well befor e they are 

predicted to happen, for all its mine sites - 

Spotted Quoll, Cosmic Boy and Flying Fox. 



Komatsu enhances ride comfort levels 

CONSTRUCTION and mining equipment 

manufacturer Komatsu Australia has increased 

the ride comfort levels of its mining dozers. 

The company says its D375A-6 and 

D475A-5EO mining dozers are renowned as 

the best ripping and dozing machines on 

the market, and they are now matching that 

reputation for comfort and ride. 

Komatsu’s mining product manager David 

Laidlaw says several major modifications 

have been made to the cab mountings to 

reduce shock loads and the undercarriage’s 

bogie and equalizer oscillation angles. “Following 

trials in Hunter V alley and central 

Queensland coal mines, we can confirm 

that the ride, vibration levels and operator 

comfort on Komatsu mining dozers ar e as 

good as or better than any other machine. 

We carried out a rigor ous independent 

testing program, comparing a D475A-5EO 

with the ride enhancement package fitted, 

a machine without the package, and a competitive 

machine – and the results show that 

we have achieved our ride and operator 

comfort objectives.” Further testing is continuing 

into additional ways to impr ove the 

ride and comfort levels for the dozers. 

Komatsu has also developed a factory-fitted 

Australian mining specification package 

which allows dozers to be deliver ed ‘mine 

ready’ directly from the factory to the mine 

site. The package includes features such as 

Komatsu Australia has enhanced ride and comfort levels of its mining dozers. 

right and left-hand access platforms with 

handrails and access lights, starter isolator 

box, manual engine stop switch and engine 

bay maintenance light. This option will save 

companies considerable time and expense 

when preparing and delivering dozers to mine 

operations. “It ensures that mine specification 

requirements for our dozers ar e manufactured 

and installed to Komatsu’s exacting production 

standards prior to being shipped to 

Australia, and that they comply to ISO engineering 

standards,” David Laidlaw says. 

The 108-tonne D475A-5EO is powered by 

a Komatsu tier II-compliant engine, incorporating 

a heavy duty high-pr essure common 

rail injection air-to-air charge cooling system. 

Komatsu says the totally electr onically controlled 

engine offers optimum fuel efficiency 

and power while minimizing emission levels. 

The D375A-6 operates at 72-tonnes and is 

powered by a tier III–compliant turbocharged 

and after-cooled engine, coupled with Komatsu’s 

automatic gearshift transmission 

which ensures the machine is always operating 

at maximum efficiency by selecting the 

optimal gear for the curr ent load. In dozing 

mode, the company’s new fully universal and 

semi universal blades allow for increased production 

without increasing blade width or reducing 

digging force. 

All components in both machines, as with 

all Komatsu branded equipment, have been 

designed and built by company engineers to 

work together as an integrated whole. 

Mining ERP on your phone 

WALK into any business lounge at any airport 

and you’ll find business people attached to 

their smart devices. Whatever the choice of 

mobile gadget, it is the primary tool of trade 

for business executives. For mining executives, 

being mobile with voice, text and email 

messages isn’t enough. MinePoint ERP software, 

developed in Australia on the Microsoft 

Dynamics AX platform, delivers on the pr o- 

mise of mobile business information. 

“MinePoint is fully-featured ERP,” says Bill 

Jarman, business manager at Eclipse Computing, 

developers of MinePoint, “But that isn’ t 

what you need when you’re in an airport lounge 

- you really need to carry on with business and 

know that essential data isn’t trapped at the office, 

it’s with you, available on your phone.” 

MinePoint was developed to addr ess the 

challenges faced by Australian mining companies 

with operations in fast-growing mining 

regions such as Mongolia, Africa and South 

America. Eclipse has 13 inter national offices 

with ERP softwar e development hubs in 

Perth and Vancouver to address the resource 

sector plus a mobility applications division in 

Hobart. With more than 400 employees, Eclipse 

is backed by 25 years’ experience in 

ERP consulting and development. 

Bill Jarman says MinePoint offers mobile business 

information that extends ERP workflow 

to executives anywhere. Workflows initiated in 

the MinePoint ERP, such as purchase orders, 

payment approvals and maintenance work orders, 

are made available for immediate action 

via smart devices without the need for a dedicated 

internet connection. This means operational 

workflow isn’t compromised when an 

approving manager is off-site. 

MinePoint’s ERP functionality supports the 

full mining lifecycle from exploration to production 

and can be deployed inter nationally 

with a range of options depending on the site 

and communications infrastructure available. 

This flexibility is underpinned by comprehensive 

international compliance matched by 

multi-currency, multi-lingual and international 

support for more than 30 countries as well as 

local tax, regulatory and market requirements. 



More user-friendly wet drum separators 

MANY wash plant operators overlook the significant 

cost implications that an inef fective 

dense media recovery circuit can have on 

overall plant operating cost. Magnetite can be 

lost at various transport and recovery points 

in the plant ranging from airborne dust, spillage, 

ineffective draining and rinsing, and inefficient 

magnetic recovery. In most cases, it 

is cumbersome and operators need to adhere 

to a strict condition monitoring and 

maintenance regime to minimize losses. 

The operating efficiencies of traditional wet 

drum magnetic separators’ are influenced by a 

number of factors that at times due to operational 

issues are extremely difficult for plant operators 

to maintain optimally for all conditions. 

Steinert Australia has embarked on the development 

of a more user-friendly wet drum 

separator which is less sensitive to the fluctuations 

that would normally be dif ficult for 

traditional separators to cope with. The result 

is not only a decr ease in time spent optimizing 

equipment, but also an incr ease in capacity 

and recovery efficiency. 

Steinert Australia’s Wet Drum Separator workshop. 

Unlike traditional separators, Steinert’s new 

generation of WDS make use of special magnet 

arrangements which result in a 120% increase 

in the average magnetic for ce index 

measured over the entir e operating gap 

through which the slurry passes. The surface 

profile of the magnetic field also allows for an 

increase in magnetic loading of the drum by 

allowing for uninhibited transportation of the 

magnetite around the drum. 

This, together with a hydraulically optimized 

counter rotation tank, enables the machine to 

operate at higher volumetric throughputs and 

higher recovery efficiencies. 

As these drums are also significantly less sensitive 

to fluctuations in operating conditions, 

these machines can in the majority of cases be 

factory set, with no further adjustment required. 



Aussie partnership for Canadian diamond mine 

A NUMBER of extended distance mine haul 

trucks with purpose-built dump bodies ar e 

heading from Australia to the Ekati diamond 

mine in northern Canada during the second 

half of 2012. One Haulmax 3900-D (up to 80 

tonne payload) with special lightweight body 

developed by Duratray is the first of the Tasmanian-built 

trucks to be supplied to Ekati. 

“It [the 3900-D] is the first of a fleet of units to 

be used on their Misery satellite mine pr oject,” 

says Haulmax global marketing manager and 

Austmine board member Bob Calvert. The 

truck will haul material mor e than 35km to a 

stockpile in testing conditions. He said winter 

temperatures could get to -60C. Thr ee more 

units are expected to be delivered later this year 

The first Haulmax 3900-D with Duratray lightweight body before embarking on the trip to northern Canada 

in time to make the 2013 ice road to the mine. 

“The Duratray is a common sight at that 

operation,” Bob Calvert said. “Haulmax wor - 

ked with Duratray Australia to develop a body 

specifically for the Haulmax unit design. The 

body was built in Melbourne, fitted to the 3900 

and shipped direct to Canada as a complete 

unit. It was selected in this instance to ensure 

the flexible body liner will maintain material fluidity 

over the longer haulage distance and time, 

reducing the risk of it freezing.” 

A Duratray Australia spokesperson said 

there were more than 30 dif ferent dump 

trucks at Ekati with Duratray Suspended 

Dump Bodies (SBDs). “As usual the body has 

all the trademarks of the Suspended Dump 

Body, with a rubber floor , rubber front wall 

and all the key benefits needed for icy conditions 

such as no carry back, impact and vibration 

reduction due to the suspended 

effect, and reduced maintenance.” 

“The client specifically requested a [Duratray] 

body. The request was purely based on 

Ekati’s experience with the SDB bodies, it just 

happened to be that the new design was a 

long haul which was a new challenge for us,” 

the spokesperson said. 

-Article from Austmine’s ‘Export News’ 

Austmine leads Australia’s METS sector 

AUSTMINE leads the international growth of 

the Australian mining equipment, technology 

and services (METS) sector by harnessing 

its collective str ength and cr eating 

enhanced opportunities for success in offshore 

markets. The organization will also be 

leading Australia’s METS sector during MI- 

NExpo 2012 in Las Vegas, USA, from September 

24-26 by way of a special section 

within the Australian Pavilion. 

Austmine will showcase eight Australian 

METS providers during MINExpo at Las Vegas 

Convention Centre - Reed Exhibitions, Pronto 

Software, Cutting Edges, Mitchell Gr oup, 

Ivolve, Minecorp, Invetech and W earX. The 

Australian Pavilion will be in the North Hall. 

Austmine’s vision is for Australia to be ‘The 

world’s number one supplier of innovative, efficient 

and safe mining equipment, technologies 

and services’. With this in mind, it brings 

together companies fr om around Australia 

that supply to the global mining industry, and 

proactively works to raise to pr ofile of the 

Australian METS sector abr oad. Austmine 

promotes its members’ capabilities, showcases 

new technological developments, and 

connects to decision makers and influencers 

in the resources sector globally. 

Whether large or small, inter nationally experienced 

or new to export, Austmine members 

are committed to providing world-best 

solutions which assist mining companies around 

the world to maintain safe, highly pr o- 

ductive, sustainably pr ofitable and 

environmentally responsible operations. 

Austmine proactively seeks out information 

on the latest developments in of fshore markets, 

new mine developments and industry 

trends through government allies, an active 

program of trade missions, meetings with mining 

companies to learn about their offshore 

expansion plans, and collating and linking to 

a range of secondary sources. Members are 

informed of these opportunities thr ough the 

website, through the publication Export News 

and at networking events, as well as through 

trade mission participation. 

Austmine represents the METS sector to 

government, both in Australia and overseas, 

to ensure members can r emain viable and 

competitive and have the best opportunity 

possible to succeed offshore. From free trade 

agreements to innovative industry collaboration 

programs, Austmine has continual dialogue 

with government at the highest levels. 

Austmine provides thought leadership on innovation 

and the future of manufacturing in 

Australia, and actively works to shape pr o- 

grams and policies to advance the inter ests 

of the Australian METS sector. 


Electric Shovels 

Shovel Performance: AC vs. DC 

A case study demonstrates the benefits of AC technology 

By Eric N. Berkhimer, P.E. 

Working with a western Canadian mine operator, 

P&H Mining Equipment conducted a 

case study to compare the performance of its 

AC-powered rope shovel against its DC-powered 

shovel. The mine operates several P&H 

electric rope shovels and recently purchased 

two P&H 4100XPC AC shovels. Because 

these units were new to the operation and are 

matched with some new haul trucks as well, a 

study was carried out in March 2011 to assess 

the productivity of these new shovels in comparison 

with a 4100XPC DC shovel that has 

been used on the property since mid-2008. 

The results showed the AC shovels exhibited 

a higher availability than the DC shovel 

through a similar period. Additionally, initial results 

indicate the cycle time of the AC shovels 

is faster, resulting in a higher production rate. 

DC controls on P&H electric shovels 

evolved from Ward-Leonard to the analog 

Electrotorque in 1968, the digital Electr o- 

torque Plus in 1997, and the Centurion in 

2004. The Centurion supervisory contr ol 

and data acquisition technology put P&H in 

a position to offer AC drives as a reliable alternative 

to DC drives. The company’s first 

AC drive shovels went into service in 

2007—two years after it launched its AC 

drive shovel initiative. T oday, P&H of fers 

both DC and AC drive shovels as demand 

continues for DC drive shovels in some mining 

regions while other regions standardize 

on AC drive technology. 

To validate the productivity rates from the 

4100XPC AC shovels, particularly in loading 

345-ton Cat 795F and 400-ton 797F haul 

trucks, a joint productivity study was planned 

and executed between the mine and P&H. In 

addition to performance improvements, P&H 

also wanted to verify that its voice-of-customer 

driven approach for mine operations 

was effective. 

improved efficiency in troubleshooting, 

thus reducing downtime; 

• AC motors used on swing and hoist to 

improve swing and hoist speeds resulting 

in productivity improvements; 

• Modifications (to name a few) were made 

to the front idler, lube system, roller 

dimensions, revolving frame dimensions, 

roller path, hoist gear case, boom and 

gantry to improve reliability; 

• Independent drives for each propel motor 

allowing “propel on demand” and eliminating 

the time required for a transfer 

from dig mode to propel mode and back 

resulting in higher productivity because 

there is more time available for production 

rather than propel delays; and 

• Rear room with improved climate temperature 

and dust control. 

These upgrades were made to impr ove 

the performance of the 4100XPC AC, several 

of which wer e targeted for validation 

during the study. 

Table 1: P&H 4100XPC Shovel Working Data 

Data Acquisition 

A study to compare the productivity figures between 

a 4100XPC DC and a 4100XPC AC 

was jointly conducted starting the week of February 

28, 2011, between P&H Mining/MinePro 

Services and the mine. A set of truck scales 

was brought in by the mine to weigh haul 

trucks loaded by the 4100XPC AC (with a few 

loads from other shovels). Those weighed included 

320-ton Komatsu 930E, 345-ton Cat 

795F and 400-ton Cat 797F haul trucks. 

During the same period, time studies were 

conducted on the 4100XPB DC (Shovel 

S05), 4100XPC DC (Shovel S06), and the 

first 4100XPC AC (Shovel S07). Additionally, 

the P&H PreVail data acquisition system installed 

on Shovel S07 was monitor ed for 

payload consistency as compared to data 

from the truck scales. PreVail also provided 

additional information on the swing angle, 

digging time in the bank, time to swing 

loaded, and time to swing and return to the 

tuck position for each dipper pass. The 

same operator was used on each dif ferent 

shovel during the time studies to eliminate 

operator skill level as a variable in the study. 

In all, there were: 

• Nearly 10 hours of time study data 

Changes from 4100XPC DC to 4100XPC AC 

A number of important impr ovements were 

included on the 4100XPC AC shovel afecting 

reliability and/or productivity: 

• Factory-built modular rear room enclosure 

for streamlined electrical routings 

resulting in shorter installation time and 



Figure 1: Breakdown of Average 4100XPC DC and AC Cycle Times 

collected; 

• 226 trucks loaded by Shovel S07 

weighed on the truck scales (over a 4-day 

period); and 

• Nearly 8,000 data points from the 

Prevail system on Shovel S07 (over a 5- 

day period) detailing swing angle, time 

hoisting in the bank, time swinging 

loaded and time swinging empty to a 

tuck position. 

As part of the study, photos were taken of 

representative dipper and truck fills to use in future 

operator discussions and training so that 

operators can better recognize when the dipper 

and truck are loaded to capacity. Additional 

data obtained from the mine included: 

• Availability data for the first 6-months of 

operation on Shovel S06 and life-to-date 

information on both Shovel S07 and S08; 

• Preventive maintenance schedules and 

actual history for the shovels; and 

• Operator and maintenance technician 

comments and feedback concerning the 

DC vs. AC shovel models. 

The study compared the 4100XPC DC and 

AC shovels from several different aspects: 

physical availability, cycle time, pr eventive 

maintenance requirements, hourly parts 

costs and, finally, overall productivity. 

Availability 

Excluding the first two months of operation to 

allow for a break-in period on each shovel, excellent 

results were found on all three shovels 

under consideration with the lowest physical 

availability being 92.52% on the 4100XPC DC 

Shovel S06 for the subsequent four months of 

operation. The two AC shovels (over a thr eemonth 

operating period on Shovel S07 and 

one month on Shovel S08) had a weighted average 

physical availability of 93.96%. 

It should be noted that life-to-date 

(through more than 16,000 operating hours), 

Shovel B has demonstrated a 93.58% physical 

availability, an improvement over the first 

several months of operation. 

If these numbers are maintained over time 

and assuming a fully trucked unit, an availability 

advantage of approximately 1.5% can 

add significantly to the mine’ s production 

rate. Under fully-utilized conditions, an improvement 

of just 1% availability can add 

some 250,000 m3 of overburden annually to 

the overall mine production (even considering 

the same production per hour). 

In the design of the AC shovel, P&H targeted 

an availability improvement of 1% to 2% over 

the DC version of the same shovel model. The 

results suggest that this is accurate. 

Cycle Time 

One of the key components in a shovel’s productivity 

is the time it takes the shovel to load 

a dipper of material into the truck (along with 

the payload in each dipper full). In an electric 

rope shovel, the cycle time consists of the following 

components: 

• Hoisting in the bank to load the dipper; 

• Swinging a full dipper to the truck; 

• Dumping into the truck; and 

• Returning with an empty dipper to a 

tucked position to begin the next cycle. 

In the time studies conducted, each component 

(except dump) was tracked individually 

(dump was consider ed part of both 

the swing empty and swing return components 

and assumed to be 2 seconds—one 

second accounted for in each of these). 

PreVail data showed an average swing 

angle of approximately 60°. 

As seen from the time study data on cycle 

Figure 2: Truck Payloads in 3-Passes 

time components (See Figur e 1), the 

4100XPC AC has an average cycle time 

some 3.5 seconds faster than that of the 

4100XPC DC. This r epresents a significant 

reduction in the load times of the shovel. A 

minor portion of the cycle time savings was in 

the swing loaded component (0.4 seconds) 

but the vast majority of the cycle time savings 

is in the time r equired to hoist the dipper 

through the bank. Faster hoist times as 

demonstrated here are one of the inher ent 

advantages of an AC drive over a DC drive in 

an electric rope shovel. Some of the time savings 

can be attributed to the shaped bucket 

that is currently being used on the AC shovels. 

These buckets are endorsed by P&H to 

reduce dig time in the face. 

P&H targeted a cycle time improvement of 

1 to 2 seconds over the 4100XPC DC when 

designing the AC shovel. The study indicates 

that the target number is currently being met. 

Dipper Payload 

Dipper payload observations on 4100XPC 

AC Shovel S07 were made using the PreVail 

system equipped on the shovel as well as the 

total truck payloads fr om the truck scales 

study information. Over a five-day period, the 

PreVail system indicated an average dipper 

payload of 91.2 metric tons (mt) fr om some 

8,000 data points. Observations made (of the 

PreVail system) strictly during the time studies 

conducted indicated an average dipper payload 

of 93.1 mt. The trucks weighed over a 

four-day period during the study indicated an 

average dipper payload of 92.7 mt. This r e- 

sulted in a very narrow range of only 1.9 mt (a 

2% spread), resulting in a very high corr elation 

between all observations made. 

However, it should be noted that there are 

some differences—from day-to-day 

as well as fr om truck model to truck 

model—that are perhaps mor e significant. 

According to Figure 2, the range from day-to- 



Figure 3: P&H 4100XPC PM Cost 

Figure 4: Relative Parts Cost Comparison – AC vs. DC 

day may be as high as 10% r eflecting 

changes in the digging conditions, material 

fragmentation, position within the bank, etc. 

It is also interesting to note there is a difference 

in dipper payloads when the 

4100XPC AC is loading the smaller Komatsu 

930E haul trucks and when it is loading the 

Cat 795F haul trucks. When loading the 

930Es, the 4100XPC had an average dipper 

payload of 90.2 mt. When loading the 795F 

haul trucks, it had an average dipper payload 

of 95.2 mt—a variation of 5.5%. This dif ference 

was relatively consistent from day-today 

and indicates that the operator may likely 

be loading to a higher dipper payload (at least 

subconsciously) when he knows that a larger 

truck is pr esent. Both 4100XPC shovels 

studied were equipped with 55-m3 dippers. 

Preventive Maintenance, Scheduling and Experience 

To date, the mine has maintained the same 

preventive maintenance (PM) schedule for the 

AC shovels as currently being used with the 

4100XPC DC shovel. They are, however, investigating 

the possibility of extending these 

intervals. Based on curr ent data, the mine 

has found that the average machine downtime 

for each PM is some 2.2 hours less with 

the 4100XPC AC shovels than with the DCpowered 

4100XPC. Additionally , they ar e 

using an average of 7.6 fewer man-hours for 

the electrical portion of the PM (See Figure 3). 

These indications from the PM data show 

that there can be a significant advantage to the 

AC shovel. If the operator is achieving an average 

of 3,300 bank cubic meters (BCM) per 

hour of production and can gain an extra two 

hours of production for every 500 hours of operation, 

there would be the potential for 79,000 

BCM of additional material to be moved each 

year. The labor savings can also add up to a 

significant reduction in PM costs. These results 

would be compounded further should the PM 

intervals for the AC shovels be extended. 

Hourly Parts Cost 

Six months of operation on the 4100XPC 

AC at the mine had not allowed suf ficient 

operating hours for the operation to generate 

a history of parts cost comparison between 

the DC and AC shovels. P&H Life 

Cycle Management, however , has made 

some long-term projections. 

Primarily because of the lower maintenance 

involved with the AC motors, P&H pr ojects an 

overall 4% reduction in parts cost per hour with 

the AC-powered 4100XPC versus the DC-powered 

unit (based on 6,000 hour-meter hours per 

year). Annually, the savings varies from 2.7% to 

5.4% with the higher variances occurring in the 

two earlier periods. Combined with the higher 

productivities experienced from the AC shovel, 

the cost per BCM is further reduced significantly. 

Overall Productivity 

It is difficult to compare productivities based 

strictly on the time study data because shovels 

do not experience the same levels of truck 

Table 2: Estimated Productivity Comparison 

presentation. Table 2 compares the expected 

overall production between a P&H 4100XPC 

DC and a 4100XPC AC based on double-side 

loading of the trucks and some of the other 

parameters observed during the time studies 

conducted of both shovels. An operating efficiency 

of 83% (50 minute-hour) will be used 

and a haul truck capacity of 290 mt is assumed 

for this estimate (with a 3-pass load). 

Based on the cycle times observed, the 

4100XPC AC would have an estimated pr o- 

ductivity advantage of 11.2% over the 

4100XPC DC in similar operating conditions. 

This is currently higher than projected by P&H 

but a target long-term advantage of 5% to 6% 

should be very achievable. As pr ojected by 

P&H during the design phase of the 4100XPC 

AC shovel, the AC-powered shovel offers some 

significant cost and productivity advantages. 

Berkhimer is a senior applications engineer for 

P&H Mining Equipment. This article was adapted 

from a presentation he made at the Haulage & 

Loading conference, which was held during May 

2011 in Phoenix, Arizona, USA. 


Screen Systems 

Large Vibrating Screen Handles High Production Demands 

W.S. TYLER says its XL-Class vibrating screen combines advanced 

drive technology with a wide body to of fer better 

screening action and more throughput. Larger than any other 

vibrating screen from W.S. Tyler, the XL-Class is intended for 

high tonnage production rates, and features exciter drive technology 

that ensures smooth operation and high uptime. The 

linear stroke is generated by counterweights mounted on two 

machined shafts that spin in opposite directions via two heavyduty 

spur gears attached to an iron casting that mounts to the 

exciter bridge. The bridge is the main exciter support and 

transmits dynamic force through the entire structure. In addition 

to better operation, the exciter design increases bearing life up 

to 50,000 hours, according to the company. 

The XL-Class offers screening surfaces of up to 390-ft2 (36 m2), 

facilitating production rates up to 15,000 tons per hour and cut 

sizes from 1/4- to 5-in. (6–127 mm) with varying degr ees of incline. 

The XL-Class can be configur ed as a banana scr een—an 

approach that can be especially effective when the feed contains 

a large quantity of fines that are much smaller than the opening of 

the screen media. To provide added strength, the XL-Class features 

a Huck-bolted screen body fastening. Side plates are constructed 

with high-strength carbon steel. The ar ea surrounding 

the shaft assembly is str engthened with a reinforcing plate that 

ties together the side plate, screen panel and shaft assembly. 

www.wstyler.com 


Product News 

Steinert now offers ore sorting solutions 

STEINERT Australia specializes in separation technologies for local and 

international mineral processing operations. Traditionally recognized for 

tramp metal detection and removal systems and heavy media recovery, 

Steinert Australia now offers ore sorting solutions to improve head grade 

ahead of the prep plant. 

This has many benefits for the operator such as: 

• Smaller downstream plant - no requirement to process barren rock 

through processing plant; 

• Reduced energy consumption - communition alone can absorb 

nearly two-thirds of the energy demand of a concentrator; and 

• Improved bottom-line by protecting crushers and breakers from 

damaging rock and tramp. 

Steinert Australia offers ore sorting solutions to improve head grade before ore 

reaches the prep plant. 

Ore sorting technology has been introduced successfully into various 

industries including waste & recycling and also mineral processing. 

These technologies include: 

• ISS – uses electromagnetic induction to detect conductive materials; 

• XSS – x-ray sensor uses the atomic properties of the elements to 

distinguish the target from gangue; and 

• NIR & 3DS – recognizes the surface properties by reflected light. 

Targets are identified by the sensor and ejected using a sophisticated 

in-house developed precision processor for very high separation 

efficiencies. Pre-concentration or ‘upgrading’ is a viable approach 

to reduce the dependence on large-scale preparation plants that require 

large volumes of water, energy, and capital investment. 

Steinert also has an extensive range of magnetic equipment that is 

manufactured in Melbourne, including: 

• Overhead suspension magnets to remove tramp iron; 

• Metal detectors (discriminating & non-discriminating); 

• Wet and dry magnet separators; 

• Non-ferrous eddy current separators; and 

• Magnetic drums and pulleys. 

Steinert invests heavily in R&D both in Australia and Germany, where 

it is engaged in delivering superior ir on ore beneficiation, improving 

MagSeps performance for heavy media r ecovery and enhancing its 

range of sensor sorting technologies to further develop their functionality. 

The Steinert Group is a leader in product development, constantly 

looking to enhance its technology portfolio so it can deliver 

leading edge solutions to all customers. 

Sandvik Mining’s new TIM3D system covers drill rig navigation, feed alignment and drilling. 

Sandvik 3D navigation system for surface drilling 

SANDVIK Mining has launched a new 3D navigation system for surface 

drilling, using satellite navigation to precisely guide the location 

and angles of drill holes in accordance with a mine or quarry drilling 

plan. The new TIM3D system, designed for Sandvik Mining’ s DPi 

and DX series surface top hammer drill rigs, is said to significantly 

improve drilling accuracy and ef ficiency in quarrying, construction 

and open pit mining applications. 

Sandvik Mining’s product line support manager – surface drills 

Michael Zirbel says, “By bringing 3D machine automation to drill 

rigs, TIM3D covers three essential drilling operations - rig navigation, 

feed alignment and drilling. The TIM3D system improves hole quality 

and hole position accuracy, translating into better fragmentation 

due to straighter holes, less fines, shot rock and oversize. This results 

in increased efficiency further in the production process, both 

in crushing and loading and hauling.” 

The system also removes the need for surveying and hole marks, 

and therefore the risk for marking errors, significantly speeding up 

drilling. “TIM3D also incorporates a simple, easy to use interface – 

with all views integrated into our DPi drill rig’s control screen, so no 

separate screen is required. In addition, the controls are integrated 

into the armrest,” he says. 

Based on a multi-satellite R TK GNSS navigation, TIM3D is compatible 

with the US GPS and Russian GLONASS satellite systems. 

TIM3D can use drilling plans made with standard office-based survey 

programs or with the system itself. Drilling plans are imported to the 

rig with a USB memory in IREDES standar d format, containing the 

target co-ordinates in three dimensions. Local base station or VRS 

correction ensures drill hole and navigation accuracy is within 100mm. 

“TIM3D makes the drilling process easier for the operator,” says 

Michael Zirbel. “The system compares the actual position of the drill 

bit with the planned hole position and guides the operator to the 

correct starting point of the chosen hole.” 

During drilling, the operator can follow the penetration rate and 

hole depth, distance to target, number of required rods and current 

feed alignment. Once at the target depth, drilling stops automatically. 

The system also shows the status of the holes with 

colour codes. In addition, TIM3D allows the operator to manually 

deviate from the drill plan if needed, for example due to a planned 

starting point that may not be achievable due to terrain, rocks or 

other physical obstacles. Despite the change in starting point, the 

hole bottom remains as planned. 


Product News 

RUD-Erlau’s Sideflex beats the boulders 

IN mining, quarrying and some earthmoving applications, the dump 

trucks used to carry waste, ore or coal from the working face to the 

processing plant, rely on large expensive earthmover tyr es to carry 

out their tasks. Tyres are the single most important asset but depending 

on site conditions, they can be subject to poor traction, abrasive 

attrition and sidewall damage. 

Poor traction due to soft, clay conditions or iced-up haul roads is a 

safety issue as a skidding, 400-tonne truck is dangerous. Abrasion is 

an asset issue as it can rapidly destroy tyres leading to premature and 

costly replacement. Nowadays truck operators overcome these problems 

by adopting the same remedies used to protect tyres of wheeled 

loading shovels, bulldozers and graders. 

Fitting a suitably-patterned, durable set of tyre protection or traction 

chains to the drive wheels pr ovides extra grip and absorb the abrasion 

– doubling and trebling tyre life. For trucks, there still remains the 

risk of sidewall damage fr om sharp flints and shale-like debris and, 

once damaged in this way, the weakened tyre becomes a write-off 

with no possibility of extended life as a remould. 

RUD-Erlau has developed Sideflex to tackle the problem of sidewall damage to truck tyres. 

Although haul roads are regularly cleared of spills and rock falls, it 

only takes one stray flint to instantly destroy a tyre and disable a truck 

with the consequent interruption to productivity. 

With loader, dozer and grader tyres it is accepted practice to pr o- 

tect tyres from sidewall damage with an impenetrable, tight-meshed 

chain but while in extr eme conditions TPCs have been tried with 

dump trucks, the long travelling distances involved make this solution 

impracticable and short-lived. 

Some 70 years ago, responding to the needs of new, pneumatictyred 

mining loaders , RUD-Erlau devised and developed the tyr e 

protection chain (TPC) going on to hold more than 65% of the world 

market for tyre protection and traction chains in mining, for estry, 

scrap and demolition, steel making and other heavy-side industries. 

Due to feedback from their TPC engineers, RUD-Erlau was wellaware 

of the vulnerability of dump truck tyres and asked their R&D 

team to tackle the problem. 

The first instinct was to cr eate a device based on steel-alloy elements. 

However, success only came when the team turned its attention 

to materials used in other industries and developed ‘Sideflex’ – an 

innovative addition to their range of asset protection products. 

A sturdy set of replacement wheel nuts and extensions support a 

simple steel ring to which is attached a fanned array of overlapping 

platelets which shield the entir e sidewall, deflecting rock fragments 

away. While mounting components ar e steel, the Sideflex shield is 

manufactured from a sophisticated engineering polymer which has 

found many applications in the automotive and other industries. 

This robust material, which is used to pr otect automobiles, has a 

unique memory capability that enables the platelets to flex and deform 

upon impact and then return to their original shape without any loss 

of integrity. The entire Sideflex assembly is so lightweight and lowprofile 

that owners of dump trucks have, for the first time, a cost-effective 

means of protecting and saving expensive tyres. 

CME commissions first TESAB screen into WA 

CRUSHING & Mining Equipment (CME), a subsidiary of H-E Parts 

International, has successfully commissioned their first Tesab mobile 

screen at Exmouth Quarries and Concrete in Western Australia. 

It is Exmouth Quarries’ second Tesab machine in operation and will 

work alongside their existing T esab primary impact crusher, the 

Tesab 1012T Impactor which is an 11- year -old model and was a 

key factor in the r eason to purchase the TS2600 Tesab screen 

owing to its durability and performance. 

CME was appointed the official distributor in Australia for Tesab 

Engineering in January this year and has the distribution rights in 

Western Australia, Queensland, Norther n Territory and Tasmania 

for the extensive range of Tesab track crushing, screening and conveying 

equipment. Tesab’s range of screening equipment includes 

one of the largest track scr eens in the market which is available 

with double and triple deck options. 

CME’s sales manager – capital equipment Kieran Hawkes says, 

“Since we signed the distribution agreement we have made good 

progress. The deliveries of the stock units arrived in late March and 

once the customer could see, feel and touch the unit they realized 

this was the machine for the application. The Tesab machines are 

well built, robust and designed to cope with the working conditions 

found in Australia.” 

The CME Tesab TS-2600 in operation in at Exmouth Quarries and Concrete in Western Australia. 


Product News 

Aker Wirth tunnel miner bound for ‘Downunder’ 

TOGETHER with Rio Tinto, Aker Wirth has developed a new, innovative 

tunnel boring system within Rio’s Mine of the Future program. In 

late June the machine departed Aker Wirth’s production facility near 

Dusseldorf, Germany, embarking on a jour ney to Northparkes Copper 

Mine in the Central West of New South Wales, Australia. The Mobile 

Tunnel Miner was due to arrive at Parkes in mid-August and then 

be made ready for its use underground. 

Aker Wirth’s new tunnel boring system leaves the factory near Dusseldorf in Germany 

bound for a mine near Parkes in southeast Australia. 

The machine concept combines the flexibility of a roadheader with 

the robustness of a tunnel boring machine. T o build this machine 

knowledge gained from a previous version that was developed and 

tested by Aker Wirth in the early 1990s was leveraged. 

The Mobile Tunnel Miner is very flexible and versatile. Using the 

undercutting technology it is especially ef ficient with tunneling in 

extremely hard rock (up to max 300 MPa). Another featur e of this 

tunnel boring system is its ability to cut - in addition to circular tunnels 

- rectangular or horseshoe-shaped cross-sections of up to 6 

metre bore diameter, eliminating the need to backfill the lower section 

of the round cross-section. 

The machine can be moved flexibly forward with a walking mechanism 

and backward with a crawler. Aker Wirth engineers employed 

several swivel joints to attain a radius of just 30 metr es which is extremely 

small for a machine of this size and capacity. The tunnel boring 

system is equipped with support systems for additional 

strengthening of the tunnel. 

The company based in Erkelenz was able to draw upon more than 

40 years of experience and expertise in underground hard rock mining 

and tunneling. Aker W irth’s CEO Einar Brønlund says, “W e will 

revolutionize safety and efficiency in underground mining with the new 

Mobile Tunnel Miner. With this tunnel boring system Aker W irth will 

play a decisive role in shaping the future of the mining industry.” 


Supplier News 

Belt conveyor audits - improve production, safety and equipment life 

UNEXPECTED periods of downtime at a mine can lead to some 

major problems, including the inability to fulfill customer demands, 

worker downtime, overtime pay when employees return to work to 

fulfill those demands, and even safety issues as a plant struggles to 

get back up to speed. Bringing in a third party who can assess your 

belt conveyor system and provide you with the feedback needed to 

keep the plant running is essential. 

There are many reasons to have someone perform an audit on 

your operation. Someone looking at your system fr om an outside 

view is important, especially since resources have been reduced at 

many operations and worker safety is still a major concer n. Also, 

the number of violations a plant can accumulate after a visit from an 

inspector can often result in unexpected downtime – another reason 

regularly scheduled audits are so important. 

Flexco’s global service pr ogram manager Rich Gilman says, 

“Owners and operators who are around the conveyors every day 

may not notice the slight changes in the system while a visitor can 

identify issues. Instead of waiting for something to go wrong, they 

can help address issues right away, saving time and money in unscheduled 

downtime.” If nothing else, an audit can keep your 

equipment running longer. Simple maintenance tasks that may 

have gone unnoticed can be identified and addr essed by your 

team, or components can be replaced that will make your equipment 

run more efficiently. 

While each operation is different, the elements of a good belt conveyor 

audit are the same. The No 1 rule is to look at the conveyor 

system holistically. “While each product in a conveyor system is a separate 

component, the entire system should be evaluated as a whole 

to ensure everything is compatible,” Rich Gilman says. “For example, 

if your fasteners and belt cleaners ar en’t compatible or your system 

isn’t centre loading, you could have a serious problem.” 

Focusing on system solutions, as opposed to simply focusing on replacing 

specific products, is also key to a good conveyor audit. Whoever 

walks the belt conveyor line needs to identify all the issues they 

find, not simply the issues that they can fix with a product or service. 

The point of an audit is not to simply identify problems but to identify 

the root cause of those pr oblems. Simply telling an operation that the 

belt is dirty and suggesting a pr oduct to ‘fix’ the problem is not a best 

practice when it comes to audits. An auditor should tell you why it is 

happening and why the solution he/she is suggesting will work for you. 

As part of the audit plan, the auditor should visit the operation and 

evaluate the entire belt conveyor system. These specialists should be 

knowledgeable experts with str ong technical skills and years of 

hands-on training with belt conveyor systems and components. 

Look for an auditor that provides you with a complete report on the 

findings, identifying the issues and the importance of fixing each issue. 

Look for an auditor that will point out which fixes are immediate and 

which fixes are recommended for the future so that you can develop 

a timeline for these adjustments. While damaged components and 

safety issues are always big concerns, the top three issues identified 

in an audit are carryback, spillage and mistracking. These issues may 

seem like simple things that should be noticed by your crew but this 

isn’t always the case. The biggest commitment you have to make when 

deciding to perform an audit is addressing the issues. Rich Gilman recommends 

performing audits once a year , and a true audit cannot be 

performed without all the belt conveyors running. Part of an audit, after 

all, is ensuring all components are compatible, and compatibility can’t be 

reviewed unless the auditor sees the parts interacting with each other . 

Following through with the audit r esults also involves finding local experts 

available to implement and maintain these systems and solutions. 

“At Flexco, we feel that it is a good rule of thumb to inspect and perform 

maintenance on all of your conveyor system components as part 

of an overall maintenance plan. An audit is a good start,” Rich Gilman 

says. “We’ve had people come back after an audit to tell us that simply 

reducing the amount of time spent cleaning up is a cost savings in itself.” 

The worldwide team of field service specialists at Flexco spends much 

time performing these audits for a variety of plants and operations. If 

you are interested in a conveyor audit, or simply want to lear n more 

about the audit pr ocess visit www.flexco.com/contact-us to find a 

Flexco representative in your area. 

Flexco says regular belt conveyor audits are vital for safety, improving production 

and increasing equipment life. 

The entire belt conveyor system should be evaluated as part of an aduit. 


Supplier News 

NO matter what their interests - surface or underground, hard rock or 

soft rock - MINExpo visitors will find the machines and technology at 

the Caterpillar exhibit to help them mine and move minerals safely and 

productively. In the centre of Central Hall, booth 6229, the largest exhibit 

space at MINExpo, Caterpillar 

will showcase the br oadest 

line of mining and 

materials handling equipment 

available backed by the 

most extensive and capable 

product support team in the 

global mining industry. 

Caterpillar will r eveal a 

number of innovative mining 

systems and machines at 

MINExpo. One such machine, 

never befor e presented 

to the mining public, 

will offer an unprecedented, 

efficient means to step up 

production loading of ultra-class haulers. Making best use of size and 

energy storage technology, the new loading tool pr omises to lower 

cost per tonne in world-class mining operations. 

In addition to innovative new pr oducts, Caterpillar builds on pr oven 

ones to make the next generation of mining machines, technology and 

Caterpillar has MINExpo’s largest exhibit 

support equipment. For example, the new AD60 underground truck with 

60-tonne capacity and the new R3000H undergr ound loader with 20- 

tonne payload capability, represent the largest such machines Caterpillar 

has ever made and pr omise to boost production and cut costs in 

high capacity hard rock mines. 

For underground coal and 

soft rock miners, the next 

generation EL3000 longwall 

shearer features a state-ofthe-art 

communication system 

for advanced automation 

and monitoring. The Cat longwall 

system includes personnel 

proximity detection and 

underground cameras that 

can be linked to a surface 

monitoring centre. 

Surface miners will be 

pleased to see a Cat engine 

powering the MD6240 rotary 

blasthole drill. They also will get to kick the tyr es of the latest edition 

of the workhorse 777 truck, the 777G, which meets North 

American Tier 4 emission standards. The 777G also has adjustable 

fuel saving strategies, performance impr ovements and enhanced 

safety features for sustainable, low cost production. 

Among the underground machines on display at MINExpo will be a Cat R3000H LHD pictured here 

loading a Cat AD60 underground truck. 


Supplier News 

MICROMINE appoints new chief executive officer 

SOFTWARE and solutions pr ovider 

MICROMINE has appointed its chief 

operating officer Kevin Fitzpatrick as 

its new chief executive officer (CEO). 

He joined the company in 2008 as 

chief financial officer and in 2010 accepted 

the role of chief operating officer 

following MICROMINE’ s 

company restructure. 

Commenting on his appointment, 

Kevin Fitzpatrick says, “Being appointed 

as CEO for MICROMINE is a 

great honour. After four years with the 

MICROMINE’s new CEO Kevin Fitzpatrick. 

company, I have seen it grow and expand 

at an exponential rate. I am excited at the prospect of continuing 

this growth and extending the reach of MICROMINE’s world class 

solutions.” Prior to joining MICROMINE, Kevin Fitzpatrick spent four 

years with Calibre Global, where he was chief financial of ficer and 

company secretary. 

MICROMINE’S managing director Graeme Tuder explains “We are 

really thrilled to have secur ed someone with Kevin’s experience as 

MICROMINE’s new CEO. His experience is a tr emendous asset to 

the company and we look forwar d to being able to pass this on to 

both our staff and clients.” 

Kevin Fitzpatrick has a Bachelor Degree in Science, Diploma of Education, 

Bachelor of Commerce and is a member of the Institute of 

Chartered Accountants and Institute of Company Dir ectors. His appointment 

is effective immediately. 

With at least 12,000 clients in more than 90 countries, MICROMINE 

is a leading provider of intuitive software solutions for the entire mining 

process. MICROMINE understands the software and consultancy 

needs of exploration and mining operations around the world. 

Hitachi to showcase AC-drive technology at MINExpo 

MANY mining professionals will get their first look at r emarkable 

new AC-drive technology advancements in Hitachi trucks at the 

MINExpo trade show in Las V egas from September 24-26. The 

company will introduce the advancements, which include Hitachi’s 

next-generation IGBT propulsion technology, at the trade show , 

billed as the world’s largest and most comprehensive exposition 

of mining equipment, products, and services. 

Hitachi will showcase its AC-drive technology at MINExpo. This Hitachi EX5600-6 has EH4000ACII. 

The technology enhancements will be showcased in a next-generation 

rigid-frame hauler at Hitachi’s booth. The truck featur es 

advanced propulsion technology that Hitachi says delivers a new 

level of efficiency, vastly enhancing machine operations for mining 

professionals everywhere. In addition, it says the new technology, 

which also powers Japan’s bullet trains, outperforms previous and 

competitive systems through its simplicity, improved efficiency, 

and enhanced dependability. 

“By specializing only on shovels and 

haulers, Hitachi is able to focus, without 

compromise, on producing highlyefficient 

and pr oductive machinery,” 

says Hitachi Mining division manager 

Ryan Blades. “The new AC-drive technology 

advancements ar e a perfect 

example of the superior quality and 

performance of this appr oach. It’s 

something every mining company will 

want to see and learn about.” 

Hitachi will be at booth #8527 in 

the Central Hall and, in addition to its 

AC drive technology for rigid-frame 

trucks, will also showcase updates to 

its Hitachi excavators. 

Hitachi Construction Machinery Co 

specializes in production of hydraulic 

excavators, shovels and rigid haul 

trucks for the mining and construction 

industry. By focusing on these 

two product lines, instead of a large 

selection of related products, Hitachi 

says it is able to pr oduce more reliable 

and productive machinery. 


Supplier News 

Boart Longyear six years LTI free at Martabe 

SAFETY is emphasized daily on mine sites or operations, especially 

those in remote locations. With high rainfall averaging 4 metres a year, 

hills with 30 degree gradients reaching up to 914 metres above sea 

level and located on the Trans-Sumatra Fault, the Martabe site presents 

an endless combination of hazar ds. Yet, the Boart Longyear 

Drilling Services (BLDS) team working on the Martabe mine site celebrated 

six years lost time injury (LTI) free in March. 

“A combination of high-risk machinery, a hazardous environment, 

strong gusting winds and electrical storms creates hundreds of combinations 

of things that could go wrong,” says Boart Longyear’s environmental 

health and safety manager in Indonesia, Taufik Octaviano. 

“We take these conditions into consideration on a daily basis.” 

On the northwest coast of Sumatra, Martabe is an open-cut gold mine 

being constructed by G-Resources. It covers 1639sqkm and includes 

seven known deposits totaling 7.86 million ounces of gold and 73.48 

million ounces of silver. The mine began producing in late July. BLDS implements 

surface diamond core methods to produce high-quality-readable 

core samples, as well as geotechnical and grade contr ol drilling 

services at Martabe. Because of the remoteness of the site, BLDS uses 

LF 7O heli-portable rigs, which allow drillers to access the rough terrain 

and the ability to reach target depth in the time frame required. 

“Safety is part of everyday discussions, both formal and informal,” 

says Taufik Octaviano. “The BLDS team r ealizes no one is perfect, 

which allows them to constantly look for ways to impr ove.” The first 

step in the safety measur es is making sure the equipment, procedures 

and standards are user-friendly. Feedback is sought fr om the 

crew on these items, providing buy-in from the team and making implementation 

of the measures a smooth process. 

Teamwork and constant training are keys to how BLDS stayed LTI free 

at Martabe. Everyone on-site is encouraged to voice an opinion on safety, 

no matter how much experience they have, what their qualifications are 

or where they rank in seniority. All new people on-site, whether they are 

first-day or long-term employees, are given green-hat (entry-level) training 

before doing any work. Physical copies of previous training certifications 

are required and if not provided, the employee will be retrained. 

Refresher trainings on critical areas are done every six months with a 

concentrated effort on manual handling, housekeeping and helicopter 

operations. The crew has gained certification as helicopter landing officers 

(HLOs) and other various specialties through independent certified 

trainers. Also, a close working arrangement between the Martabe team, 

the client and helicopter company allows for the use of each other’s resources 

and sets a uniform standard and direction. 

“When promotions and/or pay rises for the crew are considered, their 

understanding and ability to follow the training seriously ar e taken into 

consideration,” says Taufik Octaviano. “We are concerned with safety in 

everything we do.” Totalling 114 BLDS employees at the Martabe site, 

the experience level of the crew ranges from six months to 40 years with 

the majority in the thr ee-to-five year range. All senior members have 

more than 15 years of experience. 

Rugged terrain at Martabe represents many challenges for drillers but Boart Longyear 

has celebrated six years lost time injury free. 


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Exploration Spotlight 

Drilling ongoing at Tete iron project 

DRILLING is pr ogressing well in the 

Tenge/Ruoni area of Baobab Resources’ Tete 

pig iron, vanadium and titanium pr oject in 

Mozambique. There have been mor e than 

6500 metres of reverse circulation and 3230 

metres of diamond drilling completed during 

the current exploration season. 

The bulk of the drilling has been designed 

to upgrade r esources at Ruoni North and 

Ruoni South as well as defining new r esources 

within the Ruoni Flats area where Coffey 

Mining has estimated an exploration target of 

between 120 million and 260 million tonnes 

of iron ore. Upgrade resource drilling in the 

Tenge resource block is expected to start by 

the end of September. 

As well as the drilling, Baobab is also making 

good pr ogress with a pr e-feasibility 

study at Tete. As part of the study metallurgical 

test work has pr ovided positive results, 

pointing to simpler processing options and 

capex savings. Baobab owns 85% of the 

project with the International Finance Corporation 

holding a 15% participatory interest. 

Beneficiation test work recently completed 

on samples from Tenge resource block demonstrates 

that the ir on ore can be suf ficiently 

upgraded to a concentrate of 

smelter-feed specification through low cost, 

coarse crushing (-3.35mm) and dry magnetic 

separation (a process known as ‘coarse cobbing’) 

at a very high mass recovery and a total 

iron yield of 63% and 84% r espectively. The 

coarse cobbing concentrate specification is 

significantly coarser than the 150 micr on 

grind size concentrate modelled in the 2011 

scoping study which requires a ball mill and 

wet magnetic separation production circuit. 

The simplification of the beneficiation process 

by eliminating the requirement for milling, 

wet magnetic separation and 

agglomeration stages, will significantly r e- 

duce the initial capital expenditure burden. 

Preliminary mass balance calculations completed 

by engineering specialists, SNC Lavalin, 

conclude that smelting of the coarse 

cobbing concentrate can pr oduce a high 

quality, ISO-compliant pig iron as well as a 

valuable vanadium slag by-product. Further 

validation, incorporating local coal specifications, 

is ongoing. SNC has commenced 

both beneficiation and iron making process 

engineering studies, the results of which will 

provide a more accurate estimate of capital 

and production costs. 

Baobab’s managing dir ector Ben James 

says, “The key outcome of this test work is 

the potential to make significant savings in 

the start-up capex for the T ete project. The 

ability to smelt a much coarser concentrate 

also allows for a less complex beneficiation 

and pyro-metallurgical route than originally 

contemplated. It is important to note that the 

preliminary specifications of the project’s potential 

pig iron product are well within the ISO 

standard for steel-making pig iron.” 

Significant Bayag Bayag mineralization confirmed 

ASSAY results from six holes at Mining Group’s 

Comval Copper-Gold ProjectPhilippines have 

confirmed significant porphyry-style mineralization 

at Bayag Bayag deposit. Results fr om 

this target, and in the extensive skarn alteration 

that extends for more than 700 metres along 

strike, provide further indications that the 

Tagpura/Bayag Bayag prospects have potential 

to host a significant copper deposit. 

Mining Group’s Comval project is in eastern Mindanao, amidst a host 

of other gold and copper/gold deposits. 

Highlights from the drilling include 5 metres @ 

0.44% copper and 0.15 grams/tonne gold from 

45 metres and 2 metres @ 1.38% copper and 

0.64 grams/tonne gold from 104 metres within 

a broader low grade mineralized porphyry feeder 

zone. Intercepts of skarn-style copper include 

32 metres @ 0.61% copper and 0.18 

grams/tonne gold from 32 metres, including 

11.30 metres @ 1.11% copper and 0.16 

grams/tonne gold from 50.7 metres. 

Mining Group says the mineralized 

porphyry feeder zones identified 

enhance the pr oject’s 

prospectivity. One hole intersected 

more than 100 metres of highly altered 

granodiorite with high grade 

copper values of up to 1.38%. Recent 

detailed gr ound magnetics 

combined with historical induced 

polarization data and the recent updated 

geological model have identified 

circular kilometre scale targets 

which are prospective for large 

scale porphyry mineralization. 

These results will be followed up 

with further drilling as a priority. 

High resolution ground magnetic 

work between the Tagpura and Bayag Bayag 

prospects has also been conducted. This detailed 

work has demonstrated that drilling at 

Bayag Bayag in particular has missed the main 

magnetic anomalies and also delineated pr e- 

viously untested potential at Tagpura. 

Geological mapping and interpretation has 

also refined the exploration model with the integration 

of ongoing detailed ground magnetic 

work and pr ovided further skar n and 

porphyry targets for drill testing within a 2km 

radius of the historic Tagpura open pit mine. 

Comval is operated by Philco Mining, of 

which Canada’s Cadan Resour ces owns 

20%. The remaining share is held by ASX-listed 

Mining Group, which is the manager of 

the project. Cadan also owns about 6.2% 

of Mining Gr oup’s capital, which rises to 

about 15.7% fully diluted for options and 

assuming Mining Group exercises an option 

to acquire the Batoto Gold Project at which 

due diligence is under way. 

Comval covers 4310 hectares in the established 

copper and gold pr oducing Compostela 

Valley region where there is much 

potential for large-scale copper and gold 

porphyry mineralization.

Volume 9 Edition 5 2012 - The ASIA Miner

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