A premier production: Alphamin Resources and the Bisie Tin Project
Alphamin is a pioneering tin exploration and mining business with the vision to be respected in the international tin mining sector, unleashing the full profit and potential of its world-class tin asset in North Kivu, DRC.
Committed to contributing to the stability and economic activity in North Kivu, Alphamin aims to bring a significant benefit to the community and other stakeholders alike.
Through the company’s flagship operation, the Bisie operation, Alphamin will supply conflict-free tin from eastern Democratic Republic of Congo.
“Alphamin represents an opportunity to make a material difference to North Kivu and most of East Africa, it’s going to be catalytic for a whole number of roll on industries,” says Boris Kamstra, CEO of Alphamin Resources.
The Alphamin Bisie Tin Project is an operation which will develop one of the highest grade known tin deposits in the world while committing to a promise of promoting economic growth and stability in North Kivu.
A resource like no other
Kamstra believes that the 4.5 percent tin orebody, which translates to around 16 percent copper equivalent or 16/17 grams per tonne gold equivalent, is an ore body strength that hasn’t been seen over the last 200 years.
“We’ve got a jewel in terms of an ore body. Look around the world, there are no produces that I know of that can provide those figures.” says Kamstra.
Alphamin is just the first of many tin producing assets in the North Kivu province, but the journey to getting the ball rolling hasn’t been without its complications.
With any new mining operation, the first steps will always involve getting people, communities and governments to buy into the vision of the mine plan.
From the start, Alphamin has been lucky to have a defined premier resource in tin and significant investor backing. Kamstra admits that this is not enough to “get you over the line.”
“One needs a good team and the support of the people around you where you are building and plan to operate, particularly the politicians,” says Kamstra.
Through continuous discussions with the local government, Alphamin were allowed to show the outlook and plan for the project. The company, through these discussions, went out and generated significant results ready to move onto the next phase of production.
“One of the riskiest things for a politician to do is to back a policy or an initiative as there is risk involved. With us however, going through the process with the government has helped us gain incredible support from them,” he says.
The road to success
A significant challenge for Alphamin has been the development of an access road to the Bisie Tin Project. There was already a road between Goma and Walikale, but one of the first developments for Alphamin was constructing a 30km access road that initially will be to expedite mobilisation of construction, but eventually to move resources to and from the project.
Access to the site originally was only possible via a one-day walk, or a helicopter ride in. Kamstra admits that this restricted the size of equipment needed for construction and would not present an efficient cost effective way of working.
“People believed the road development was impossible, but together with the North Kivu government, we have taken pretty poor logistical circumstances and implemented mitigating strategies to make what was once unsurmountable achievable,” Says Kamstra.
A community can play the most important role in the success of mining operations. For North Kivu, the Bisie Tin Project represents an opportunity to create not only a premier tin producing area, but also create industry.
“Our approach is that we are guests of the people around us. We happened to be born in two environments that allowed us to be more educated and affluent in the people whose backyard we are working, that doesn’t make us any better,” says Kamstra.
Creating an industry
As a mining company, the ability to influence a surrounding environment is enormous. This influence can be dictated by a wide range of inputs that need to be supplied or, in what Kamstra describes as “reverse engineering” creating industries.
“For example, if your workforce requires a uniform, then as a company you can source this locally, bring in the material and create sewing groups. That right there is work for the community brought upon by you as a company,”
“The more your business is integrated into the area you’re operating in, the more robust your business model,” says Kamstra.
As a mineral production company Alphamin, like many within the eastern DRC, are regulated through conflict mineral legislation. Conflict mineral legislation is in place as due diligence guidance for responsible mineral supply chains. For Kamstra, Conflict Mineral legislation is instrumental in creating opportunity that he believes Alphamin can fulfil.
“Tin is a strange commodity in many ways in that there are not many mines that can produce it,” he says.
“There’s quite a big artisanal production with very few smelters that can upgrade it and yet tin in minute quantities makes up things on your desk, cell phones, computers, cars etc. many of those are made by very large corporates, such as Apple or Microsoft for example.”
Kamstra believes that as a result of this there is a constriction in the supply chain, constriction that can be squeezed if there are problems in the supply of the material. For the larger corporations such as Apple, Microsoft and Samsung complying with conflict mineral legislation can prove difficult and the Conflict Free sourcing initiative is in place to assist those companies in finding smelters and refiners validated as “conflict free”.
Constriction and conflict free
Alphamin will be presented with an opportunity to provide the Conflict Free Sourcing Initiative with a mine plan which will show a full breakdown of how much tin Alphamin will extract as well as a metals balance throughout the plant. This allows Alphamin to verify all of the tin that is produced from the plant.
“This makes it very simple for us as a smelter to have a very solid stream of conflict free material within their system with a great degree of certainty and that can be passed on to the larger companies,” says Kamstra.
The conflict legislation does not stop there. As is common place in the DRC, trucks hauling resources can and have been seized and for Alphamin, the legislation and close communication with the government allows the company to remain in control, even if the worst case scenario were to happen.
“We can alert the tin community that we’ve lost X tons of material and we will have the full specifications of it. The people who have it will now be restricted as to who they can sell it to, as the main stream smelters will not be partial to buying it,” says Kamstra.
What this effectively does is sterilise the economic value of the material and Alphamine’s mine in anyone else’s hands.
“There’s a kind of in built insurance policy that should any of our material be liberated from us, it effectively economically sterilises it from the world at large,” says Kamstra.
Only the beginning
Looking ahead to the future, the Bisie Tin Project will begin construction in early 2017 with a minimum construction phase of 11 months. Kamstra and Alphamin has outlined the production reaching full capacity in 2019. The project has a 12-year mining licence, but Kamstra is firmly of the belief that there is potential to go on beyond that.
“The only reason we have 12 years is simply because we decided that’s enough and we stopped drilling,” says Kamstra.
“There’s plenty more tin deeper underground, but at the time the drill rigs we had on site were fairly light. As soon as we start producing capital we will get larger equipment to begin drilling further,”
Looking back, Kamstra highlights a level of momentum, enthusiasm and excitement surrounding the project. The support of investors, the local community and government has been and will continue to be instrumental in the development of the Bisie Tin Project.
“There is an excitement and enthusiasm around the project that’s infectious. For the first time everyone in Walikale can almost taste a future that’s going to be a better future for their children and families than it ever was for them. It’s a wonderful backdrop to be working against.
“It is quite extraordinary. There haven’t been many projects that have achieved this kind of general momentum, enthusiasm and excitement.” He concludes.
The November issue of Mining Global Magazine is live!
Get in touch with our editor Dale Benton at [email protected]
Mining 4.0: How innovation is shaping mines of the future
Mining may be the gateway to the world’s carbon neutral future. Green energy storage systems, for one, are largely dependent on minerals. According to the World Bank Group, clean energy needs will escalate demand for rare earth minerals by nearly 500% by 2050.
While this growing demand holds much promise for mining companies, it also creates new challenges. Mining operators must navigate the ever-present highly cyclical market conditions and capital-intense operations. Recent trends layer on additional challenges, such as the progressive retirement of the industry’s most experienced workers, increasing regulatory pressures, and rising energy costs. To proactively manage these multiple challenges and capitalize on rising demand, mining companies must innovate and lower operating costs to remain both profitable and viable.
Why the urgent need for innovation?
Leading mining companies have shown that lower operating expense (OpEx) is a pre-requisite to on-going business success. This need is driven by the cyclical mining market and ever present,, hefty capital requirements, both of which are inherent in the mining industry. And, when demand is high, the OpEx cost component of unplanned downtime grows steeper. Data indicates that, in mining operations, the root cause of OpEx overages lies in maintenance issues that impede operating efficiencies and incur unnecessary costs. Left unaddressed, these gaps will prevent mining companies from fully capitalizing on increasing demand.
According to McKinsey, mining companies have historically struggled with significant productivity declines, as shown below. In recent years, there is evidence that a slow recovery is underway, however, full resolution is in its’ infancy, primarily rooted in maintenance cost optimization.
Other data points on current mining operations underscore the urgent call for innovation and change:
- 70% operating efficiency due to breakdowns and stalled production, which translates to real potential for increased productivity and throughput
- 30-50% of mining operations costs spent on maintaining plant, fleet and equipment, so, the magnitude of potential improvements on bottom-line profitability is significant
- 3-5X cost for urgent repairs and corrective work requests versus planned maintenance, often made evident by tracking the percentage of work orders managed through the planning office.
While change is always difficult, the promise of technology (and Industry 4.0, Mining 4.0) is a welcome and required one for mining companies. Digital technologies and automation, or Mining 4.0, is defined by smart equipment, drive data-driven (and thus better) decisions, catalyze connected communications and provide easier, more affordable maintenance. From there, mining companies will be able to speed up production, reduce downtime and boost employee safety – three pillars that have challenged mining operations for years.
The first step: Predictive maintenance via condition monitoring
As the first step to regain operational optimization and lower costs, mining companies must get “ahead of the curve” and prevent process interruptions and unplanned downtime. The key is predictive maintenance via condition monitoring systems. By proactively assessing equipment health, mining operators can be alerted to developing failures before they occur and schedule planned repairs at the lowest possible cost and with minimal impact to production.
Condition monitoring systems are based on the principal that failure is a process, not an event. By monitoring asset characteristics, latent anomalies become apparent well before full failure, allowing for low-cost interventions, root-cause analysis and proactive planning for resolution, thereby mitigating process interruptions. Concurrent with deployment of well-engineered predictive maintenance strategy, a thorough rationalization review can minimize unnecessary or redundant maintenance tasks and, in many cases, eliminate human-induced failure modes.
Maintenance optimization is a powerful lever – and the first step -- to achieving and sustaining lower production costs in mining.
When 14% equals $8 million
Consider this PwC mining example, where predictive maintenance enabled a 14% reduction in maintenance spend by mitigating unplanned downtime to deliver US $8 million savings in operating expense (OpEx).
Goal: Reduce unplanned downtime
Solution: Condition monitoring system on critical equipment
- Condition monitoring insights provide operator alerts of potential failures.
- Proactive scheduling of repairs moves resolution to occur during planned maintenance, partial outage periods or normal equipment rotations.
- Asset availability and reliability increases, production interruptions are minimized and maintenance costs are reduced.
Result: 14% reduction in maintenance spend generates US $8 million in OpEx
Source: PwC “Balancing Uptime and Working Capital: Maintenance and Inventory Strategies in Mining”
Reliability and employee safety
The example above illustrates the dramatic improvements to operating expense as mining operators move from reactive / unplanned to proactive / planned maintenance. With decreased downtime, overall operational reliability also improves and with it, a metric of paramount importance in mining: employee safety.
Studies indicate that more reliable operations are safer operations. That’s because technology serves to reduce human-to-machine interaction and urgent, reactive work declines. For one industrial company, as shown in the graph below, an OEE (Overall Equipment Effectiveness) improvement of 52% delivered a safety improvement of 69% during a 10-year period.
Customer Case Study: Slurry pumps
Let’s look at specific mining applications ripe for optimization and maintenance cost savings. The first is slurry pumps. In mining pumping stations, pump failures are responsible for 97% of unplanned maintenance costs. Pump reliability, however, is crucial in the areas of safety, environmental impact, and efficient transportation.
Key characteristics of slurry pumps can be monitored so that timely analysis of impending issues enable early detection of issues at inception and prior to failure. This avoids unplanned maintenance, unplanned downtime, and averts lost revenue.
In slurry pump applications, dynamic pressure sensors can be used to detect reciprocating diaphragm failures, providing a novel diagnostic to increase pump reliability. The solution is based on these design principles:
- The hydraulic fluid flexes the diaphragm
- When the diaphragm flexes, slurry is discharged
- Abrasive, corrosive slurries prohibit pressure sensor installations in slurry valves
- Thus, dynamic pressure monitoring of the hydraulic fluid assesses the effectiveness of slurry discharge
The result? A savings of US $3 million per year, based on maintenance cost recovery and capacity increases for a 10-pump station.
Customer Case Study: Haul Trucks
In mining operations, haul trucks are another critical asset, as they are relied upon to move raw materials. Alignment of extraction speed to transportation speed is required to keep operations flowing smoothly. Mining operators have invested in larger, automated haul trucks to facilitate this timing alignment and optimize logistics. Thus, haul trucks and their operational health is a key enabler of production reliability in mining operations.
Monitoring haul truck health to ensure reliability, however, presents unique challenges. Because haul trucks are in constant motion, data collection at precise and crucial times with linkage to a monitoring center and diagnostics requires innovative thinking and design.
For one mining company, a custom engineered solution for the haul truck’s control system was designed and installed. The system was devised to monitor haul truck health in two distinct operating states so that changes in the various failure mode characteristics could be accurately identified:
- Running and loaded. In this state, vibration data is collected while the truck is running, loaded and in reverse mode (braking the truck using the electric motor of the electric wheels).
- Unloading. During unloading, vibration monitoring data is collected when the haul truck dump or bucket is being raised.
The result? An estimated savings of US $5 million per year, based on an iron mine fleet of 30 trucks operating at 80% capacity.
Outcomes like the examples above are possible for mining operations via innovative condition monitoring systems. There are many other condition monitoring mining applications, such as wireless sensors for hoist systems and continuous monitoring for SAG (semi-autogenous grinding) mills that deliver transformational outcomes. The ultimate payoff for mining companies occurs when these applications and systems scale and interconnect into an operation-wide solution, enabling more holistic optimization.
Benefits of condition monitoring
Condition monitoring is part of Mining 4.0, the transformation driven by the adoption of automation and digital technologies. Mining 4.0 inherently supports the infrastructure and process requirements for condition monitoring systems. Specifically, Mining 4.0 will facilitate capabilities such as digitization, automation, analytics, artificial intelligence and machine learning, establishing a powerful foundation for predictive maintenance solutions and innovation.
Technology and predictive maintenance benefits have the potential to transform mining operations, starting with condition monitoring. In addition to managing and minimizing the impact of failures, mitigating downtime and reducing maintenance costs, condition monitoring systems also help to increase worker safety, reduce energy consumption and meet environmental requirements.
These benefits unleash significant potential for radical and positive changes in mining operations. All condition monitoring systems, however, vary in scope and effectiveness, so proper selection of a design and enablement provider with full-scale capabilities and proven expertise can impact outcomes significantly.
Innovation beyond technology
While innovation and transformation hold great potential, mining companies must go beyond reducing maintenance costs and implementing technology solutions. Companies must work differently and work smarter to capitalize on the full potential of digital technologies and holistic data strategies that deliver operation-wide benefits. For successful adoption, overcoming internal organizational barriers and cultural challenges to digital adoption is equally essential.
To reduce pressure on capital-intense mining operations, condition monitoring solutions can be “self-funding” initiatives on the journey toward Mining 4.0 as operational benefits of condition monitoring are realized progressively from the early stages of implementation.
The way forward for mining companies is clear -- and full of promise. As the world increasingly relies on mining to produce the minerals needed for green energy, innovative mining leaders will usher in an era of profound global transformation that ultimately benefits us all.
To learn more about condition monitoring systems in mining operations, please reach out to speak with one of us or another experienced professional at Baker Hughes.