Engineering & Mining Journal

JUL 2018

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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NEWS-LEADING DEVELOPMENTS 6 E&MJ • JULY 2018 www.e-mj.com could add to reserves and resources and provide for sustained mining operations." Development of the Phase 1 open pit has begun and will be one of the first open-pit mines operated by Barrick that will include autonomous mining equip- ment. This new technology could provide an opportunity for reduced mining costs and improved safety. Mine development capital in 2018 for Phase 1, on a 100% basis, is currently forecast for $17 million and $90 million for the entire project. The run-of-mine material from Phase 1 will be stockpiled, pending a decision on whether to proceed with a process- ing facility located on the joint venture property. This has the potential to add to future resources and reserves, and subse- quent production, at South Arturo. The El Nino underground deposit is the down-plunge extension of the Phase 2 pit, which was mined in 2016-2017. Ground work, including backfilling of the Phase 2 pit, has been completed and full construction of the El Nino mine will begin in July with capital costs in 2018 estimated at US$7.4 million on a 100% basis and $36.4 million for the entire project. Following development of the upper ore zones, underground explora- tion will be initiated to identify additional mineralization, which remains open at depth and locally along strike. Work will continue to advance a po- tential Phase 3 open-pit and additional run-of-mine heap-leach material that would complement material from Phase 1. Drilling to further define and expand mineralization is currently occurring. Rusal Starts to Ship Bauxite From Dian-Dian UC Rusal reported it has completed the first stage of development of the Dian-Di- an bauxite deposit in Guinea and it is now exporting ore. During this first stage, Rusal commissioned a mine with a pro- duction capacity of 3 million metric tons per year (mt/y) of bauxite and has built the associated infrastructure to support the transportation and storage of ore. The opening ceremony was attended by Presi- dent of Guinea Alpha Conde, Russian Am- bassador to Guinea Alexander Bregadze, as well as the management of RUSAL. "For the last 15 years, RUSAL has re- mained one of the largest investors in the economy of Guinea," said Yakov Itskov, director of the Alumina Division at UC RUSAL. "The mutually beneficial nature of our cooperation with the government of Guinea, within the framework of the Di- an-Dian project, continues to contribute to improving the investment climate in this West African country. RUSAL owns the development rights for Dian-Dian, which is the world's larg- est bauxite deposit with proven reserves of 564 million mt. In 2015, within the framework of the investment project, RUSAL signed a multilateral agreement covering the use of the existing railway infrastructure in the province of Boké, where the Dian-Dian mine is located. This was the first such agreement between RUSAL and the government of Guinea, with the aim of fostering a spirit of collab- oration between business and the state in order to achieve the full industrial and socioeconomic potential of the country. In related news, UC RUSAL also an- nounced the restart of the Friguia Alu- mina Refinery in Guinea. This follows agreements reached in 2016 between the Republic of Guinea and the company, which provide for the ramp up of produc- tion up to 550,000 to 600,000 mt/y of alumina per year within 12 months from the resumption of operations. "The commencement of shipments from the Dian-Dian deposit and the re- sumption of the operation of the Friguia alumina refinery are important develop- ments both for RUSAL and the Republic of Guinea," Itskov said. The Friguia alumina refinery complex includes a bauxite mine, alumina refin- ery, railway and other infrastructure. The entire complex has been designed with an annual capacity of up to 650,000 mt of alumina and 2.1 million mt of bauxite. Production was suspended in 2012. RUSAL has been operating in the Re- public of Guinea since 2001, and is one of the largest foreign investors in the country. RUSAL also operates the Compagnie des Bauxites de Kindia (CBK) in the Republic of Guinea. BHP Selling Cerro Colorado Copper Mine BHP has entered into an agreement to sell the Cerro Colorado copper mine in Chile to private equity manager EMR Cap- ital for a total cash consideration of $230 million, plus approximately $40 million in proceeds from the post-closing sale of certain Cerro Colorado copper inventory, and a contingent payment of up to $50 million to be paid in the future, depend- ing upon copper price performance. The sale is subject to fi nancing and customary closing conditions, and is ex- pected to close during the fourth quarter of calendar-year 2018. Located in northern Chile, Cerro Colo- rado represents one of two copper mining operations of BHP's Pampa Norte divi- sion. In fi scal year 2017, Cerro Colora- do produced 65,000 metric tons (mt) of copper cathode. In August 2017, BHP announced ap- proval of capital expenditure of $2.46 bil- lion for its Spence Growth Option (SGO) at the Spence mine, which will extend the mine life by more than 50 years. In the fi rst 10 years of operation, incremen- tal production from SGO will be approxi- mately 185,000 mt/y of payable copper in concentrate and 4,000 mt/y of payable molybdenum, with fi rst production ex- pected in BHP's 2021 fi nancial year. OceanaGold Increases 2018 Production Guidance OceanaGold Corp. has increased its 2018 consolidated gold production guidance on the back of strong operating performance and improvements to the mine plan at the Didipio Operation, the company said. As a result, the company's 2018 gold pro- duction guidance range has been revised upward and now sits at 500,000 ounces (oz) to 540,000 oz. "We have had a strong operating and fi- nancial performance in the first half of this year with our operations achieving better than expected results," said Mick Wilkes, president and CEO, OceanaGold. "With the improvement to the mine plan, Didipio con- tinues to outperform and present opportuni- ties for further optimization while ramp-up of the underground is progressing nicely." Haile has seen strong performance with solid plant performance and min- ing activities are gradually improving, he said. "In New Zealand, after a slow start, Waihi is back on track while Macraes is slightly exceeding expectations with im- proved plant performance and a steady feed of higher grade ore from Coronation North," he added. With the increase to its production guidance and its financial performance, OceanaGold fully expects to maintain its standing as one of the most profitable gold companies globally.

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