IN April 2011, the world’s second-largest gold producer, Newmont Mining Corporation, announced plans to spend an estimated $7 billion on asset development in a move to increase its annual gold production by 35 per cent, to about 7 million ounces, by 2017. However, the company has been forced to revise this growth target to between 6moz and 7moz to address the possibility that its troublesome Peruvian projects may not advance. This means that in order to meet medium-term growth targets Newmont’s other developments, including its Northern Territory-based Tanami Shaft project, have increased in significance.
Tanami Shaft project overview Located on Aboriginal freehold land in the remote Tanami Desert, Newmont’s Tanami operations are centred on the Callie underground mine at Dead Bullock Soak and the Granites Mill ore processing facility, 40km to the east.
Callie – which incorporates the Callie and Auron ore bodies – has been mined to a depth of more than 1500m. In response to rising costs due to mine depth and ageing infrastructure, in July 2011 Newmont announced the investment of US$450 million for a deep shaft project with the potential to extend mine life to 2027 and increase annual output by almost 30 per cent to as much as 400,000oz.
The proposed 1300m shaft was designed to transport mined ore to the surface, making it economic to continue mining beyond the existing depth.
Newmont reported that the Tanami shaft, due for completion in early 2015, would support the underground expansion of the Callie and Auron ore bodies, as well as leaving the door open for further expansion options in the future. Importantly, Tanami’s costs should fall by about US$100 per ounce in the first five years of the shaft’s operation.
“The Tanami Shaft project is a materials handling system designed to improve the efficiency of the mining operation, increase the mine production rate, reduce operating cost and extend the mine life,” Newmont Tanami Operations general manager Bill MacNevin said.
“It is estimated to add a further 3 million ounces of gold to the mining production profile.
“The additional ounces will be obtained by allowing economic access to deeper resources and by reducing cut-off grade, which in turn allows for greater recovery of the ore body.”
The shaft project will involve the construction of the 6.5m-diameter, production shaft with a ground-mounted Koepe winder hoisting system capable of producing 2.5 million tonnes per annum.
Underground systems required for crushing, ore handling, storage and hoist-loading infrastructure will also be installed, including conveyors, a tramp removal system and loading flasks.
A surface ore stockpile with a radial stacker system and truck-loading facility will be developed, and roads modified, to provide access for load-out.
Integration of the shaft into the mine ventilation system will involve the installation of bulk air coolers at the shaft collar with connection to the existing refrigerated water system.
The operaton’s existing power station will be expanded, as will its Twin Hills accommodation village to house the construction workforce.
Utilities will be extended to the depth of the mine via the shaft, including water, high voltage power, communications equipment, compressed air, apparatus for fire and dust suppression, sewage and an underground refuelling station.
In December 2011, engineering firm TWSP was contracted by Newmont to develop the vertical shaft. The $35 million, three-year project willsee TWSP design, construct and commission a 1.3km vertical shaft system to access the underground ore body, with Tanami’s existing decline shaft system to remain operational.
TWSP will also undertake engineering, procurement and construction management services for the development of an ore-hoisting system, headframe and integrated ventilation system.
“We will be making use of expertise we have already demonstrated with vertical shafts, including a previous one in Western Australia for a tier 1 mining company,” TWSP chief operating officer Bryan Bailie said in a statement.
Major progress has already been made on the project, with the shaft pilot hole due for completion in the third quarter 2012. The contracts for surface earthworks, shaft collar construction, shaft winder supply and underground development have been awarded. The design of the shaft sub-brace and collar system have been completed, along with the shaft headframe steel supply and collar system.
“The installation of a shaft will allow the mine to maximise benefits from future discovery via exploration,” Mr MacNevin said.
“The successful completion and operation of the shaft will significantly reduce Newmont’s risk profile of mine operations by reducing the number of trucks and the congestion of traffic in the underground mine.”
Separate to the shaft project, the company has started operation of a 6000t per day paste plant for the backfilling of stopes and has invested in an airstrip upgrade from road base gravel to a bitumen surface. Newmont also reported that it expected exploration expenses at Tanami to increase in 2012.
In 2007, Newmont became the first gold company to be included in the Dow Jones Sustainability World Index, which comprises about 300 global companies identified as leaders in sustainability and economic, environmental and social performance. Newmont was named on the index for a fifth straight year in 2011.
The index assesses companies on criteria including transparency, corporate governance, risk and crisis management, environmental management and performance, stakeholder engagement, community development, energy management,climate change, biodiversity, human resources and safety.
At Tanami, Newmont has initiated a number of significant environmental, community and employment programs for the betterment of communities neighbouring the mine.
Indigenous employment programs Newmont has committed to staffing all of its mines with as many local residents as possible and, in 2011, reported that 45 per cent of its employees and contractors were from the Northern Territory.
The company also has agreements in place with the Federal Government to provide employment for Aboriginal people at all of its Australian mines. At Tanami, it has detailed commitments under an agreement with the Central Land Council (CLC) that addresses the needs of indigenous people in the workforce and in the community.
In addition, Newmont maintains specific site-based policies regarding stakeholder engagement, the protection of sites, the recruitment of indigenous people, cross-cultural awareness training and community interaction. Newmont also has an agreement with the Traditional Owners, who assist with biodiversity management and monitoring issues.
For many years, Newmont and the CLC have partnered to gradually increase numbers of Aboriginal workers employed at Tanami. After more than 11 years of working together to move indigenous people into employment, Newmont and the CLC have managed to secure job placements for more than 500 local people.
Community funding and the environment
The Tanami operations are on Warlpiri Traditional Land, which requires Newmont to pay ongoing royalties to the Warlpiri people. Communities in the areas surrounding the mining operations are compensated through the Granites Mine Affected Areas Aboriginal Corporation (GMAAAC), with the money divided between 9 GMAAAC communities who then choose which local organisations should be funded. Royalties are also paid to the Warlpiri Education and
Training Trust (WETT) project, and must be spent on local indigenous education and training. WETT project funding has assisted a youth and media program that offers diversionary activities for young indigenous people, with an emphasis on media training.
Newmont is also committed to land reclamation and environmental management at Tanami. As such, it undertakes a number of projects to ensure the mine area and its surrounds are adequately cared for and can be rehabilitated successfully after operations cease.
In 2004, the company undertook a unique four-year regional biodiversity project at Tanami to investigate whether activities at the mine had an impact on wildlife abundance in the area. A second regional biodiversity survey is planned for later this year.