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Game-changing R3.6bn project positioning Kumba Iron Ore well into the future

Kumba Iron Ore executive head technical and projects Glen Mc Gavigan interviewed by Mining Weekly’s Martin Creamer. Video: Darlene Creamer

4th March 2021

By: Martin Creamer

Creamer Media Editor

     

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JOHANNESBURG (miningweekly.com) – Four and a bit years ago Mining Weekly told its readers to keep a look out for the five letters – UHDMS – which stand for ultrahigh dense media separation.

At the time, outgoing Kumba Iron Ore CEO Norman Mbazima had told Mining Weekly that these five letters translated into “mouth-watering” financial metrics for the JSE-listed Anglo American group company.

Excellent news now is that during the second half of 2023, when the UHDMS project, valued at R3.6-billion, is commissioned, it will further extend the mine life of Kumba’s Sishen iron-ore mine to 2039.

“We really are excited about the approval of the Sishen ultrahigh dense media separation UHDMS project,” Kumba Iron Ore executive head technical and projects Glen Mc Gavigan told Mining Weekly in a Zoom interview. (Also watch attached Creamer Media video.)

This comes on the back of Kumba Iron Ore having approved Kapstevel South, a R7-billion project, early in quarter three last year.

“It’s really great news for us and really exciting. Just on the UHDMS project, we really do see this as a game-changer for Kumba. We’ve been talking about it for quite a while and now we really are pleased that it has been approved,” said Mc Gavigan, who outlined the structural characteristics of Kumba’s iron-ore operations in the Northern Cape compared with those of iron-ore operations in Australia and Brazil.

To understand the project, he said it was important to consider the context in which Kumba operates in the Northern Cape.

“As a major mining province in the world, we’ve got certain structural characteristics versus the majors, namely the Australians and the Brazilians. And that really is around our short life-of-mine,” he explained.

Up until the UHDMS, the Sishen mine had a 12-year life-of-mine. That really links back to how much tonnage is in the ground.

“We estimate that the Northern Cape’ probably got a billion tonnes of iron-ore left. If you think about the Australians and the Brazilians, they’re talking 60-billion tonnes.

“So, life-of-mine is challenged in the Northern Cape and also from a stripping ratio perspective, how much waste you need to move in order to expose our ore. We’re sitting at about four-to-one compared with the Australians and the Brazilians at one-to-one or maybe two-to-one. That’s also structural disadvantage. But  the one major benefit that the Northern Cape has is in the quality of its product in what we get from both an iron (Fe) and a lump perspective. We get $15/t more premium than some of the majors, just because of our drive on quality.

“If you think about the UHDMS in that context, you obviously want to enhance what you are already doing. What the technology does is basically make it possible for us to increase the densities in our plant and in our DMS plant by the difference between 3.6 and 4.2, and that does a few things for us.

“Firstly, it means we can beneficiate better so we can upgrade our premium product offering from about eight-million tonnes to 20-million tonnes, an increase of about 12-millon tonnes, and, as I said, that attracts a nice premium for us over and above the market, so it really does play into the Northern Cape’s inherent characteristics.

“Secondly, because we can lower the cut-off grade, we can essentially bring about 130-million tonnes of reserves into our portfolio, which extends our life-of-mine. Through a combination of other projects we’ve also done we extend from 12 years to 19 years, so we’ve basically added seven years to the life of Sishen, which has got huge benefits for us but also just think about the region. From a mine the size of Sishen, 53% of the population of the area is either directly or indirectly employed by the mine.

“Because we’re converting waste into ore, the overall strip ratio of Sishen goes down from 3.8 to 3.1, so this technology really is a game changer for us all around and does position us from a sustainability and a quality perspective much better into the future,” Mc Gavigan explained.

UHDMS is a specialised technology that has been locally developed.

“Essentially, we put our ore through a bath of ferrosilicon and our ore sinks and the waste floats and that’s essentially how we separate out,” he said.

The development of the technology follows Kumba going into a partnership with Exxaro Resources about five years ago, which resulted in the building of modular pilot plants, two at Sishen and one at Kolomela.

“We’ve been operating these for the last four years and now we’re comfortable that we can actually upscale that technology to apply to the Sishen plant. Sishen is a 26-million-ton to 28-million-ton-a-year plant, so a much larger scale, but we’ve taken the modular approach and now we can really install this with confidence and basically retool our business for the future with Proudly South African technology,” said Mc Gavigan.

The company is continuing to develop Kolomela through the Kapstevel South project as well as advancing an exploration programme across its prospects in the Northern Cape to enhance the resource pipeline.

‘This is how we re-imagine mining to grow the business and extend the life of our mines through our FutureSmart Mining™ - our innovation-led approach to sustainable mining,” concluded Mc Gavigan.

Edited by Creamer Media Reporter

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