Engineering & Mining Journal

JUL 2017

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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REGIONAL NEWS - U.S. & CANADA 8 E&MJ • JULY 2017 Stillwater Reaches 2-year Wage Agreement With US Steel Workers Sibanye announced that it has secured a two-year wage agreement with the United Steel Workers of America, Internation- al Union, the representative union at its Stillwater Operations in Montana, USA. Negotiations with the United Steel Work- ers of America, International Union at East Boulder, will take place at year end. The terms of the agreement include a 2% general wage increase for all job categories effective from June 2, 2017, to January 1, 2018, with a further 1% increase effective from January 1, 2018, to June 1, 2018. A 2% annual increase will be in effect for the second year of the agreement, from June 2, 2018, to June 1, 2019. Neal Froneman, CEO of Sibanye, said, "We are very pleased to have secured this wage agreement soon after having acquired the Stillwater Operations. We note and are encouraged by the sensible and mature manner in which stakehold- ers have engaged, to agree on a mutually favorable outcome for the company and employees." Dominion Going Underground at the Misery Kimberlite Pipe Dominion Diamond has reported positive results from a prefeasibility study (PFS) of development of an underground mine, to be called "Misery Deep," below the Misery open pit at Ekati diamond mining operations in Canada's Northwest Territo- ries, approximately 300 km northeast of Yellowknife. The Misery kimberlite pipe is located in the Core Zone joint venture at Ekati, in which Dominion has an 88.9% participating interest. The Misery Main pipe is currently in production as an open pit and is expect- ed to account for approximately 20% of ore processed and 60% of carats recov- ered at Ekati in Dominion's fiscal 2018, ending January 31, 2018. Ekati also draws current production from the Koala underground and Pigeon and Lynx surface mines. The company also has reserves in the Jay and Sable kimberlite pipes, which have not yet been brought into production. Ekati mine planning currently projects continued operations until 2035. The Misery Deep PFS is based on an inaugural probable mineral reserve of 1.8 million mt and 8.7 million carats. The mine plan includes extraction of 1.8 mil- lion mt of kimberlite on five underground production levels, using a sublevel retreat method similar to that employed at the Koala underground mine. Project development will require the addition of infrastructure, including expan- sion of the existing Misery camp, addition- al compressed air supply, refurbishment of the existing shotcrete plant, a fresh-air- raise ventilation system from surface, tie in of the electrical distribution system to the Misery substation, and expansion of the existing water management system. Initial capital to develop the Misery Deep project is estimated at $94 million. Dominion was planning to make a con- struction decision before the end of June. Assuming a project go-ahead, Dominion will initiate the permitting process and be- gin detailed engineering and procurement activities in the third quarter of 2017. Mobilization of contractors and mining equipment is anticipated on the 2018 win- ter road. Development work is expected to span four years, with initial ore production from development in 2019 and commer- cial production starting in 2020. The com- pany does not plan to complete a stand- alone feasibility study for the project. The Misery pipe has produced a num- ber of high-value fancy yellow and or- ange diamonds, with valuations ranging from $10,000 to $150,000 per carat. A 65.93-carat fancy yellow diamond named the "Arctic Sun" was recovered from the Misery Main pipe, and Dominion part- nered with a client to create a 30.54-carat fancy vivid yellow VS1 polished diamond with an estimated value of $5 million. The "Arctic Sun" is the largest fancy yellow stone recovered to date in North America. The potential for mining large fancy di- amonds represents upside for production from the Misery Deep operation. To accommodate the processing of Misery Deep ore, the PFS assumes that approximately 1.6 million mt of Pigeon ore, with an associated 800,000 recov- ered carats, will be mined according to the existing life-of-mine plan, stockpiled and deferred from processing until later in Ekati mine life. Cliffs Natural Resources Picks Ohio for HBI Plant Cliffs Natural Resources Inc. announced it has selected a site in Toledo, Ohio, for the development of its first hot briquetted iron (HBI) production plant. Midrex Tech- nologies was selected to design, engineer and procure equipment for the new plant, which will have the nominal capacity to produce 1.6 million tons of HBI per year. "Today's announcement marks a very important strategic milestone for Cliffs as we begin to implement our plans to be the sole producer of high-quality HBI for the EAF steel market in the Great Lakes region," said Lourenco Goncalves, chair- man, president and CEO. "We look for- ward to the strong margin and earnings potential this new product will generate for Cliffs shareholders." Goncalves added, "We thank Gov. John Kasich, JobsOhio and a number of local partners in the Toledo commu- nity for their efforts to help advance this project, including an offer of approxi- mately $30 million in grants and other financial incentives." Gov. Kasich said, "This is great news for Toledo and we're pleased that Cliffs chose Ohio for their new investment. In addition to our strategic location and strong business climate, our low-cost nat- ural gas resources give job creators in this industry a competitive advantage, some- thing Cliffs recognized when considering sites for this new technology." The 65.93-carat fancy yellow diamond named the 'Arctic Sun' was recovered from the Misery pipe.

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