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Telfer Mine Operations Overview
Mark Mitchell General Manager
2
Location
T elfer
P erth.
P O R T H E D L A N D
B R O O M E
N E W M A N
T E L F E RT E L F E RM A R B L E B A R
T O M PR IC E
N ew crest M in ing L im ited
T E L F E R P R O JE C TL ocation M ap
0km 250km
T elfer
P erth.
P O R T H E D L A N D
B R O O M E
N E W M A N
T E L F E RT E L F E RM A R B L E B A R
T O M PR IC E
N ew crest M in ing L im ited
T E L F E R P R O JE C TL ocation M ap
0km 250km
Distances From Telfer To:
Perth 1,300kmMarble Bar 270kmPort Hedland 450kmKarratha 600kmNewman 320kmNifty 70km
3
Site Layout
4
History & Highlights
Operation suspended in 2000
– Produced >6Moz
A detailed feasibility study for an expanded mining and processing operation was concluded in 2002
Construction of the project began in 2003
Open pit operations re-commenced mid 2003
Ore processing re-commenced Nov 2004
Exceeded feasibility study for all major physical parameters – mill throughput, underground hoisting capacity and open pit mining rates
5
Description of Operation
Ore contained in narrow reef or stockworks
Two mines
– Open pit (60-80Mtpa material movement)
– Underground ( > 5.6 Mtpa ore)
Ore processing ( > 18+ Mtpa)
– Conventional grind, gravity, flotation and CIL circuits
– Producing gold/copper concentrate and gold bullion
Open pit owner mining operations
Underground mining, alliance contract with Byrnecut Mining
Fly in fly out operation. Total workforce reducing from budgeted1400 to around 1000 people (employees plus contractors)
6
Security of Tenure - Community
The Martu people are the acknowledged traditional owners of the Telfer Project area
The Martu People and Newcrest in 2003 reached agreement on:– An Infrastructure Corridor Agreement in respect of the gas pipeline corridor– A Community Benefits Agreement under which Newcrest provides certain benefits to the
Martu for the first 6 years of operations
Newcrest Has:– Maintained 100% compliance to our obligations under the existing agreements– Continued with programs in education, health, training and employment– Currently >30 Martu employed at Telfer, > 90 indigenous employed. A Mine Entry Training
Program commenced in early 2008– Worked collaboratively with the Martu on important projects
7
Security of Tenure - Environment
Telfer R&D work a real highlight
– Closure Landform Development (with UWA)
Investigate the viability of forming natural landforms for rehabilitation of the Telfer area.
– Weed, Seed & Topsoil (with Kings Park Botanic Gardens):
Seed viability in topsoil, seed collection, storage and germination.
8
Geology
Rocks consist of a folded sequence of metamorphosed sandstones and siltstones that are 1.2 billion years old
Folds form domes hence the term ‘Main’ and ‘West’ Dome
A later stage event has introduced the gold and copper
Ore contained in ‘reefs’ and ‘stockworks’– Reefs – are parallel to the sedimentary layering– Stockworks – cross cut the sedimentary layering
Demands selectivity in mining to deliver the best ore grades
Mineral Resources – 19.5Moz gold & 0.7Mt copper
Ore Reserve – 14.5Moz gold & 0.55Mt copper
9
Mining Overview
10
Open Pit
Open Pit Operations comprise mining of two pits– Main Dome
– West Dome
Owner operated fleet– Conventional truck/shovel operation
– 12 metre benches
– RC grade control drilling
Open pit fleet– 24 Caterpillar 793 Haul Trucks
– Liebherr - 4 Excavators and 1 Face Shovel
– 5 drill rigs
11
Underground Operations
Materials handling system- Shaft to 1126m @ 7m diameter- loading station at 1100m- nameplate capacity 4Mtpa- currently achieving > 5.6Mtpa- underground gyratory crusher & automated skip loading
Sublevel level intervals 25m– cross-cuts at 14m
centres
Byrnecut contract mining
12
Processing Layout
Basic Flowsheet
13
Infrastructure
Power is generated on site
– Three gas turbines with total capacity of 138MW
– Natural gas supplied by 450 km pipeline from WA coast
– Pre-existing diesel power station provides back-up power
– Long term gas contract until 2019 at current rates
Groundwater (potable and production) from surrounding area
Road access via Pt Headland and Marble Bar
14
Reducing Telfer’s Cost Structure
Telfer cost reduction programme– Reduction in permanent manning on site from 1400 in June 08 to around1000
by December 2008. – Structured approach to further improvements in cost using detailed driver tree
analysis is underway.
What allows us to reduce permanent manning?– more stable plant availability– decrease in unscheduled work– productivity improvements– Clear demonstration of value required for temporary additional labour
Outcomes – FY08/09 cost reduction target of $25M to $30M.– Ongoing annual cost saving of $45M - $50M– Driving Telfer to the middle of the cash cost curve for the industry
(US$450 - $470/oz = industry mid point after by-product credits)
15
Reduction in Telfer’s Manning Levels
Telfer Permanent Site Plan vs Actual Permanent No.Includes Reduction & Transition
1389
13391319
1283
1238
1175
1000
13401324
1282
1235
1389
800
900
1000
1100
1200
1300
1400
1500
Jun Jul Aug Sep Oct Nov Dec
Month '08
Telfe
r Per
man
ent S
ite C
ount
Telfer Permanent Manning PlanTelfer Permanent Manning Level
16
Key achievements over last 12 – 18 months
Improving asset management
– Increasing focus on planned and preventative maintenance
Increase in processing plant recovery
Outstanding performance of underground operation
– hoisting improvements the tip of the iceberg
Open pit – positive results from dilution management program
Successful establishment of business improvement programs
– Mill throughput programmes underway
– Open pit operational efficiency programmes underway
17
Increasing underground hoisting rate
7000
10000
13000
16000
19000Ju
l-07
Aug
-07
Sep
-07
Oct
-07
Nov
-07
Dec
-07
Jan-
08
Feb-
08
Mar
-08
Apr
-08
May
-08
Jun-
08
Jul-0
8
Aug
-08
Sep
-08
Tonn
es p
er D
ay (t
)
2.6
3.1
3.6
4.1
4.6
5.1
5.6
6.1
6.6
Equi
vale
nt T
onne
s pe
r Yea
r (M
t)
60 day moving average Step Change
Improvement of acceleration and deceleration of
hoist
Changes to mine planning and mine design to optimise crushing feed to
hoist
Improved feed conveyor
performance increasing skip
load
Final hoist cycle time & skip load improvement
and ongoing mine planning optimisation
Gas Feed Disruption
Gas Feed Resumption
Continued hoist
utilisation improvements
18
Fixed plant - Increasing proportion of planned work
A major achievement. The data demonstrates the transition from a reactive to a proactive maintenance regime.Significant decrease in unplanned maintenance.Lower cost, fewer upsets and fewer people in the long run.
Telfer Scheduled Work Compliance 10-01-07- to 26-10-08
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93Week
Schedule Work (Jobs)
Scheduled Work Completed(Jobs)
19
Reduction in plant stoppages
Higher degree of planned and preventative maintenance has doubled the average time between mill stoppagesWe expect to be able to significantly improve on this measure
Mean Time Between Stoppage (MTBS)
0
10
20
30
40
50
60
1-Mar-08 1-Apr-08 2-May-08 2-Jun-08 3-Jul-08 3-Aug-08 3-Sep-08 4-Oct-08 4-Nov-08
Date
Ope
ratin
g H
ours
T1 - MTBS 60 day aveT2 - MTBS 60 day aveLinear (T1 - MTBS 60 day ave)Linear (T2 - MTBS 60 day ave)
Tim
e
Mean Time Between Stoppage (MTBS)
0
10
20
30
40
50
60
1-Mar-08 1-Apr-08 2-May-08 2-Jun-08 3-Jul-08 3-Aug-08 3-Sep-08 4-Oct-08 4-Nov-08
Date
Ope
ratin
g H
ours
T1 - MTBS 60 day aveT2 - MTBS 60 day aveLinear (T1 - MTBS 60 day ave)Linear (T2 - MTBS 60 day ave)
Mean Time Between Stoppage (MTBS)
0
10
20
30
40
50
60
1-Mar-08 1-Apr-08 2-May-08 2-Jun-08 3-Jul-08 3-Aug-08 3-Sep-08 4-Oct-08 4-Nov-08
Date
Ope
ratin
g H
ours
T1 - MTBS 60 day aveT2 - MTBS 60 day aveLinear (T1 - MTBS 60 day ave)Linear (T2 - MTBS 60 day ave)
Tim
e
20
Increase in Processing Recovery
Several projects completed and further work in progress has enabled recovery to be in the 85 to 88% range.
– Circuit configuration– Online process control technology
Still a substantial list of projects to apply to this area
Telfer Gold and Copper Recovery
50
60
70
80
90
100
Jan-0
8
Feb-0
8
Mar-08
Apr-08
May-08
Jun-0
8
Jul-0
8
Aug-08
Sep-08
Oct-08
%
Gold Copper
21
Key Targets and Priorities
Underground
– Continued improvement in mining and hoisting rates
– Additional mining opportunities
Open Pit
– Improving mining selectivity
• Blast movement
• Digging selectivity using high precision GPS technology
– Improving operational productivity
• Improving short interval control
• Minimise ore rehandle
Processing plant
– Circuit De-bottlenecking
• SAG Mill Liner & Grate Optimisation
• Pebble crushing optimisation
Focus on cost reduction
22
Exploration Potential
A number of local opportunities
Current Drilling– O’Callaghan’s– Below and around the
current underground mine
– Below West dome pits– Camp Dome
Acebell
Telfer
O’Callaghan’s
Westwin
Camp Dome
Trotman’s West IP
Redback
Minyari
23
Summary
Exceeded feasibility study for all major physical parameters
Underground has achieved outstanding performance
Improved asset utilisation
Cost reduction program to drive Telfer towards the mid point of global cash cost curve
Focus Areas– Mine – delivery of tonnes and grade– Plant – increased throughput
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