Australia-based underground mining contractor Barminco will begin work next month on a three-year develop- ment and production contract at the Mount Lyell copper, gold and silver mine, in Queenstown, Tasmania, 240 km south of the Australian mainland, CEO Peter Stokes tells Mining Weekly.

The Mount Lyell copper mine is the oldest, continually operating mining field in Australia, as it has been operating for more than 100 years.

Mine production amounts to about 2.7- million tons a year of copper ore at 1.25% copper grade. The copper ore also contains 0.3 g/t of gold and 3 g/t of silver.

The contract, which was awarded last month by Copper Mines of Tasmania (CMT), part of diversified miner Vedanta Resources, is Barminco’s second-largest contract to date and requires a workforce of 200 personnel.

The project will require 3 600 m of advancing decline development each year and produce 2.47-million tons of ore a year.

Barminco notes that, besides the Mount Lyell project, it has a strong pipeline of prospective projects in Australia and has experienced a strong year so far in terms of contract wins and extensions.

“We have secured another new project in Tasmania, this year, at the underground Renison Bell tin mine, on the west coast of Tasmania, which is owned by the Bluestone Mines Tasmania joint venture (JV). Bluestone Mines Tasmania is a 50:50 JV between diversified mining group Metals X and Yunnan Tin Parksong Australia, a subsidiary of Chinese tin producer Yunnan Tin,” says Stokes.

The contract entails development and production mining. The decline development started in March, with a yearly advance of more than 6 000 m and a yearly ore production of more than 700 000 t.

Barminco has also had its contract with gold major Gold Fields’ Agnew gold mine, in Western Australia, expanded and extended.

Agnew is located about 375 km north of Kalgoorlie, in the same geological region as Gold Fields’ St Ives gold mine, and exploits shear-hosted auriferous zones from the highly mineralised Norseman-Wiluna greenstone belt.

“The contract at Agnew has resulted in the mine shifting from an owner-operator model to a contractor model, validating Barminco’s value-add and cost benefits as a contractor in the current market conditions,” says Stokes.
Barminco has been conducting mine development on site since May 2010 but the company’s contract has subsequently been extended and expanded to include production mining and paste and mobile maintenance.

Meanwhile, Barminco has also had its development-mining contract extended at nickel producer Western Areas Flying Fox nickel mine, in Western Australia.

Barminco began operations at Flying Fox in 2004. The contract extension will involve 7 800 m of jumbo development and 740 000 t of ore production.

The Australian mining industry has been affected over the past 12 months by falling commodity prices, a period of reduced Chinese demand and high operating costs. These factors have resulted in some projects being delayed and cancelled and, subsequently, in job losses, after a period of massive growth.

Despite Australian projects’ focus on reducing costs, global demand for the country’s commodities will continue and the future, thus, looks positive for underground mining contractors such as Barminco, notes Stokes.

“We are seeing more mines move underground and towards using contractors for these projects, which results in a good pipeline of opportunities for us,” says Stokes.

Barminco is tackling cost challenges through the establishment a close working relationship with its clients by integrating its teams with those of its clients to ensure complete alignment – from planning and productivity to costs – with an ongoing focus on continuous improvement.

An example of this close alignment with clients and one which yielded significant results, is the Sunrise Dam project, in the northern goldfields of Western Australia, with Barminco’s long-term partner, gold mining major AngloGold Ashanti.

“The introduction of our efficiency ini- tiative, which included reviewing major causes of downtime and streamlining production planning, resulted in a 20% improve- ment in development performance and a 30% improvement in production performance,” explains Stokes.

The need to improve efficiencies is driving innovation in the company, as it seeks to increase the value of its service and maintain its competitive advantage, not only in Australia but also in Africa.

Presence in Africa
Barminco’s presence in Africa stems from its 50% joint venture with diversified mining and services company Ausdrill, known as African Underground Mining Services (Aums).

Aums operates six projects in West Africa, focusing particularly on Mali, Ghana and Burkina Faso.

Barminco is also independently pursuing opportunities in Namibia, Tanzania and Botswana, while it is already operating at gold producer Centamin’s Sukari gold mine, in Egypt, where it also recently had its work programme extended, says Stokes.

“Central and Southern Africa have several existing and potential underground mines and projects which are known for frequently making use of contractors,” he notes.

Barminco’s expertise in Africa includes development and production mining, production drilling, charging and blasting, loading and hauling to the surface and diamond drilling services using a modern and mechanised drill fleet.

The company is also skilled in mechanised development mining, specifically high-speed mechanised hard-rock mine development and jumbo drilling using electric or hydraulic jumbo drills and rubber-tired, diesel- engine-powered equipment.

“Barminco has the techniques and level of expertise required in Africa to success- fully take operations underground, perform them safely and deliver cost benefits, with its experience in decline mining being one of its key value offerings in Africa.

“We believe we can add value at several projects, including greenfield sites, mines that are currently owner operated and those which have underground contracts up for tender,” says Stokes.

He also states that the company expects to announce a major contract award in the region Africa in the coming months.