Closure plan: a tool for mine management and cost savings

A.M. Pulino Golder Associates, BrazilE. Chapadeiro Golder Associates, BrazilA.A.S. Pena Golder Associates, BrazilA.P.M. Saliba Golder Associates, Brazil

Summary

• Introduction

• Methodology

– Mine Closure Plan

– Identification of Critical Closure Costs

– Assessment of alternative closure approaches

• Results - Case Study

– Mine Closure Plan and Critical Costs

– Alternative closure approaches and potential savings

• Conclusion

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Introduction

• Mining should be managed using a life cycle approach the way you conceive and operate the mine has huge impact on closure (costs)!

• Mining is a dynamic activity Mine closure planning must be a dynamic process.

• Knowing closure costs in advance is crucial.

• Mine Closure Plans can be a powerful tool for mine planning and management.

• Decisions made in the early stages of mine planning can significantly impact closure costs.

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Introduction

• Objective: to demonstrate how the mine closure plan can be used as a tool for mine management.

• Focus of presentation:

– Methodology for identifying critical closure costs Planning and financing closure.

• Technical aspects of closure solutions proposed on the case study are not the focus.

• Social aspects of mine closure are not the focus also.

• Case study presented to exemplify the methodology.

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Methodology

Conceptual mine closure

plan

Identification of critical

closure costs

Assessment of alternative

closure approaches

Simple but powerful

Dynamic process

Focus on main issues

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Methodology• Mine Closure Plan Guidelines:

– Must be prepared as early as possible;

– Updated throughout the mine life cycle;

– Level of information increase uncertainties and risks decrease

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Methodology

• Conceptual mine closure plan:

– Define life of mine: ROM, waste rock and tailings production schedule;

– Define domains (ex: open pit, waste pile, tailings dam, process plant);

– Describe future condition of each domain (physical and chemical characterization) propose closure concept estimate cost (quantities x unit costs) risk assessment;

– Put all domains together in the closure plan prepare physical-financial closure schedule;

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Methodology

• Identification of critical closure costs:

– Find out what are the costs that contribute the most to the overall closure costs.

– Critical closure costs can be of two kinds:

• Domains ; and

• Activities.

– Critical Domains: direct comparison.

– Critical Activities: add up costs of similar activities for all domains and compare.

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Methodology

• Assessment of alternative closure approaches:

– Why is it a critical cost (quantity or unit costs)?

– Quantity:• Large structures

• Usually hard to reduce

– Unit costs: • The more complex the closure concept, the higher costs

– Is it possible to reduce these costs? How?• Alternative closure approaches

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Case Study - Mine Description

• Open pit mine with both oxide and sulphide ore types.

• Process includes crushing, milling, flotation and acid leaching.

• Mine domains: open pit, waste rock pile (sulphide material), two dams for the flotation tailings and ponds for the leaching tailings.

• Confidentiality:

– Site name, owner and values will not be disclosed.

– Closure costs and potential savings will be disclosed as percentages only.

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Case Study - Closure PlanDomain Closure Measures Closure Cost

GeneralAdditional studies, decommissioning management, socioeconomicactions, water quality monitoring for the whole site.

8%

Open PitPump water to accelerate lake formation, cover exposed sulphideareas, treat pit lake water until it reaches a stable geochemicalcondition.

4%

Waste PileCover with soil layer (mine overburden), implement surfacedrainage system and revegetate.

14%

Process Plant Complete demolition and removal. Revegetate the whole area. 3%

Flotation Tailings Dam AImplement multilayer cover over the whole dam reservoir:trafficability layer (soil), capillary break (crushed rock), store andrelease (soil). Revegetate the whole area.

28%

Flotation Tailings Dam B

Keep a lake on the upstream part of the dam reservoir; implementmultilayer cover over exposed tailings beaches: trafficability layer(soil), capillary break (crushed rock), store and release (soil).Revegetate the covered area.

32%

Leaching Tailings PondsImplement multilayer cover over the whole area: trafficability layer(soil), capillary break (crushed rock), HDPE membrane, store andrelease (soil). Revegetate the whole area.

11%

TOTAL 100%

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Case Study - Critical Costs

• Soil covers will use all mine overburden material mass balance to ensure there will be enough cover material

• Critical Domains: – Waste Pile (14%), Tailings Dam A (28%) and B (32%) 74% of total

closure costs.

• Critical activities:– Excavation of cover material: 14% of total closure costs.

– Transport of cover material: 29% of total closure costs.

– Crushed rock for covers (capillary breaks): 15% of total closure costs.

– Together those activities represent 58% of total closure costs.

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Case Study - Alternatives

• Waste Pile:– Cover: 80% of domain cost

– Quantity issue: Large volumes of cover material

– Recommendation: optimize cover design (modest savings)

• Alternative: – Reduce unit costs by using mine equipment

– Cost of third party equipment is 5 times higher than mine costs

– Recommendation use a progressive rehabilitation approach to reclaim the pile with large mine equipment

– Potential savings: 57% of domain closure costs

– Issues: change the pile design (allow traffic of large equipment) + integrate pile reclamation with mine planning

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Case Study - Alternatives

• Flotation tailings dam A:– Receives oxide + sulphide tailings complex cover to avoid ARD

– Cover: 91% of domain cost

– Quantity issue: Large volumes of cover material

– Unit Cost issue: crushed rock (capillary break) cost

• Alternative: – Make a “cover” with oxide tailings during operation (enough material

to dispose a 4 m thick oxide tailing top layer) minimize ARD risk

– Change to a simple soil cover (reduce unit costs)

– Potential savings: 60% of domain closure costs

– Issue: change mine operation and production schedule

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Case Study - Alternatives

• Flotation tailings dam B:– Will receive sulphide tailings only complex cover to avoid ARD

– Cover: 90% of domain cost

– Quantity issue: Large volumes of cover material

– Unit Cost issue: crushed rock (capillary break) cost

• Alternative: – Improve flotation recovery desulphurization minimize ARD risk

– Desulphurization plat is currently under feasibility study focus on process recovery, not closure

– Potential savings: 64% of domain closure costs

– Dam closure cost great impact on desulphurization plant feasibility

– Design for closure approach

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Case Study - Alternatives

• Soil Covers:– Critical costs activities are all related to cover construction.

– Most part of this material is overburden that will come from the mine

– Alternative: improve overburden management allow direct hauling from the mine to the other areas

– Issue: timing overburden is mined before waste rock need to identify areas that can be covered throughout the mine life

– Requires integration between mine planning and closure planning.

• Crushed Rock (capillary break layers):– Segregate oxide and sulphide waste rock

– Reduce unit costs of crushed rock in 80%

– Requires waste rock management changes mine operation

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Case Study - Alternatives

DomainClosure Cost –

Base Case

Alternative Closure

Approach

Potential Saving Closure Cost –Alternative

Scenario

General 8% None - 8%

Open Pit 4% None - 4%

Waste Rock Pile 14%Progressive

rehabilitation57% 6%

Process Plant 3% None - 3%

Dam A 28%Oxide Tailing

Cover60% 11%

Dam B 32% Desulphurization 64% 12%

Leaching Tailings Ponds

11% None - 11%

TOTAL 100% 55%

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Conclusion

• Methodology for assessing critical closure costs was shown to be simple but very useful allowed focusing on the key issues in order to improve the economic effectiveness of closure solutions.

• Alternative closure approaches identified directions to further studies rather than final closure solutions additional engineering design will be necessary to assess technical and economical feasibility.

• Alternative closure solutions proposed will require changes on mine design, planning and operation, but might result in a great reduction of closure costs.

• Need to integrate mine closure on mine planning mine closure plan can be an important tool for mine management and cost savings.

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Thanks!Alexandre Pulino apulino@golder.com.br

55-31-2121-9837

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