Engineering & Mining Journal

MAR 2019

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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Page 34 of 67

ENERGY EFFICIENCY MARCH 2019 • E&MJ 33 highlighting new alliances, technologies and equipment designed to solve some energy-related challenges. Picking Up Pace Although recent developments indicate the industry's rate of acceptance and implementation of energy-efficient strat- egies seems to be quickening. According to EY, it has struggled to overcome years of inertia and delays caused by: • Not utilizing third parties to develop, fund and deliver RE assets. • Renewables seen as "non-core," with significant internal resource/opportunity cost. • Limited over-arching divisional or re- gional energy strategy. • Lack of clear strategic view or response to approaches by renewable energy developers. However, a press release distribut- ed recently by Voltalia, a French power provider specializing in RE sources, and THEnergy, a boutique consultancy fo- cusing on microgrids/mini-grids and off- grid RE, points to positive changes and expanded opportunities in the industry. Specifically, this is in regards to ener- gy supply in remote regions or wherever the power grid is incomplete, unreliable or experiencing stress from growing de- mand, such as Africa. The release pointed out that mining companies have increasingly adopted wind and solar systems to reduce their energy costs at remote off-grid mines. The initial focus was on-site integration capabilities, as miners were concerned that adding intermittent renewables such as solar and wind could affect the reli- ability of power supply and even lead to production losses. However, according to the report, renewables combined with diesel, HFO, or gas in various microgrid applications have proven to be a source of reliable power for remote mines, and "…for almost all mines, the integration of renewables will have a positive impact on their energy cost position. Mining compa- nies do not have to invest their own mon- ey. Independent power providers (IPPs) invest in the renewable energy infrastruc- ture and sell electricity to mines through power purchase agreements (PPAs)." According to Thomas Hillig, managing director of THEnergy, large IPPs take ad- vantage of economies of scale on compo- nents for solar and wind power plants not only for remote mining projects, but also for much bigger grid-connected plants. One of the most recent example of mine operators turning to transactions with independent power providers is Res- olute Mining's signing of a joint develop- ment agreement (JDA) with Ignite Energy Projects Pty Ltd., a financier, developer and operator of power projects in Africa, for the development of a new 40-mega- watt (MW) independent solar hybrid pow- er plant at the company's Syama gold mine in Mali. The Syama solar hybrid power plant will combine solar, battery and heavy fuel oil (HFO) technologies. The innovative project is expected to be the world's larg- est off-grid, fully integrated hybrid power plant for a stand-alone mining operation. The new power plant will replace the ex- isting historic 28-MW diesel-fired power station at Syama and is expected to be fully operational by the end of 2020. The project will be funded and con- structed under an IPP model whereby Ignite Energy, under the terms of an ex- clusive power purchase agreement, will be responsible for the design, construc- tion, ownership, funding, and operation of the new power facility on an exclusive basis and will supply power to Resolute on a guaranteed basis subject to a maxi- mum tariff over a term of between 12 and 20 years. Managing Director and CEO John Wel- born said the Syama solar hybrid power plant will deliver long-term electricity cost savings for the mine of up to 40% while reducing carbon emissions and providing tangible benefits to local Mali communi- ties. "The project is a key component of delivering the expected sub-US$750 per ounce all-in-sustaining-cost for the Sya- ma underground gold mine." The company said the plant will com- prise an advanced combination of mod- ern solar photovoltaic generation (Solar PV), HFO-based generation, and a bat- tery-based energy management system. HFO fuel costs are expected to be up to 50% lower than diesel, with larger mod- ern generating units substantially more efficient than Resolute's current engines, which date back to when the Syama power station was originally established by BHP in the 1980s, featuring a fleet of diesel generators, which have progressively ex- panded to meet operational requirements. The current cost to generate power at Sya- ma ranges from $0.20/kWh to $0.24/kWh depending on prevailing diesel fuel prices. PPA's aren't the only option for min- ing companies looking for renewable or greener power sourcing arrangements, ac- cording to CCSI. Other avenues include: • Energy Attribute Credits – The mining company purchases credits produced by RE power plants. Source: Report, Renewables for mining in Africa enter the next stage–Focus shifts to cost optimization, THEnergy-Voltalia, February 2019.

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