The Mining Blog

We have all seen the news about the slowing Australian economy. The latest ANZ jobs survey showed a 5.9% decrease in job advertisements in October. This followed a 1.4 decrease in September. Overall, job advertisements are down 9.8% from October last year.
(See full story on MarketWatch)

The government has release the Mid-Year Economic and Fiscal Outlook (MYEFO) which predicts that Gross Domestic Product (GDP) and jobs growth are both expected to slow significantly. However, Treasury has assessed that a recession is not in prospect.
(See full story on Forbes)

Yes. Australia is being affected by the global financial crisis.

So what about the mining industry?

Many people believe that the mining boom has peaked. Actually, it seems more like there is a “wait and see” approach being taken by some mining companies. Many projects have been put “on hold” while the mining companies assess potential drops in resources demand. Production cuts have also been announced by several mining companies. This has meant that many companies have already cut staff.

The recent announcement of China’s Economic Stimulus plan has caused shares in major Australian mining companies to rise on Monday.

Despite the downturn, the Minerals Council of Australia (MCA) has maintained that demand from China will continue at high levels. They are still predicting significant increases in jobs over the next 12 years.

It will be interesting to watch proceedings over the next few months.

Xstrata Coal today announced that it has secured Xstrata PLC Board approval to proceed with the AUD1.1 billion development of the Mangoola Coal open cut coal mine near Muswellbrook.  Xstrata Coal acquired the Mangoola project from Centennial Coal (then known as Anvil Hill) in October 2007.

The construction of the mine will create around 400 new jobs, with an expected 300 employees required for the ongoing operation of the site.

A further 700 employment opportunities will be created indirectly as a result of the development.

The Mangoola Coal mine will produce up to 10.5 million tonnes per year of run of mine ROM of both export and domestic quality thermal coal with an expected mine life of 18 years.

Mangoola Coal will generate over AUD35 million ($33 million) per annum for the NSW State Government through coal royalties and provide significant support to local infrastructure, employment and training projects through a Memorandum of Understanding with Muswellbrook Shire Council.

Peter Freyberg, Xstrata Coal Chief Executive, stated that, “Xstrata Coal is the largest producer of export coal in New South Wales, with a proven history of successful project development. We have the technical skills, experience and senior management in place to deliver projects on time and on budget, as demonstrated by the recent completion of our Liddell and Glendell open cut projects.”

At each stage of the Mangoola Coal project, Xstrata Coal will implement detailed environmental management processes to address energy conservation, air quality, noise and vibration, water resources, and any potential impacts to flora and fauna.

Mangoola Coal will produce coal for both the export and domestic markets in a 80:20 ratio over the life of the mine. An agreement for the first 12 years of domestic production is in place with Macquarie Generation (Bayswater and Liddell power stations). Export output will range between 6 million tonnes and 7 million tonnes per annum. All product coal will be transported by rail from the mine site to either Macquarie Generation or the port of Newcastle.

Major construction works will commence upon the issuance of the mining lease. Development consents and other approvals have been received.

We have just launched a new web site for Business Owners called The Business Reference.  The site has lots of free information to help you run your business.  Here are just some of the information you can get your hands on from this web site:

• Free Business Information
• Free Marketing Information
• Email Marketing
• Web Site Hosting
• Registering Your Web Site Domain Name

The idea behind this site is that many people would ask us questions about how to run or market their business.  We knew that there is a host of free information out there, so are compiling the best free information into one place.

We will continue to add to this site as information becomes available.

Let us know if there is something that you think that we should include on the Business Reference site.

A new type of transport system is now available that could bring incredible benefits to the mining industry. The system can potentially eliminate the need for constructing new railways to transport coal / ore from the mine to the port (or other destination).

The great thing about it is that the same system can also be used to transport workers to / from the mine, in many cases eliminating the need for expensive fly-in-fly-out (FIFO) transport.  The system can also be used to transport supplies to / from the mine.

Another major benefit for the mining industry is that this system can eliminate the need for expensive port loading infrastructure because the transport modules can load directly into ships.

This system is also an answer to some of the criticism received from the environmental movement.  The system can be installed with minimal earthworks and can cross sensitive environmental areas with minimal impact.  The system is also extremely fuel efficient.

The cost to install the system is about half the cost of installing a conventional railway line. If you combine the savings from line construction and eliminating the port requirements, the savings amount to hundreds of millions of dollars.  In some cases, this can mean the difference between proceeding or not proceeding with a new mine development.

Read more about the application to mining transport.

The same company has also developed a system for high speed passenger transport.

Imagine being able to travel from Sydney to Melbourne in less than 2 hours! Imagine doing it without all the hassles of airport check-ins and going through security.

Their inner city passenger transport solution will enable people to travel across the city at speeds of up to 110kph.  This type of system can be installed in just about any city because it is installed ABOVE the city.

For more information, go to the Alternate Transport website. The website has lots of images and even a few videos to watch.

Mining Equipment heavy-weight, Joy Global, has announced that it has agreed to buy Continental Global, the world-wide manufacturer of conveyor systems. The deal which is worth US$270 million is expected to be finalised within the first quarter 2008.

Mike Sutherlin, Joy Global’s President and Chief Executive Officer said that the purchase of Continental would expand the range of products and services they can deliver to their customers, and was consistent with their strategy of adding related and highly synergised product lines. He added that Continental’s conveyor systems fit closely with their surface and underground and businesses, allowing Joy to leverage their strong global presence in both segments.

From other comments made, it appears that Joy is looking to further integrate their face mining systems with outbye conveyor systems in order to further improve system reliability.  If this truly happens, it would surely be welcomed by all longwall and development superintendents.

Let’s see how all this progresses.

Calvin Close
Managing Director
Australian Mining Reference

Further links:

Australian Mining Business Directory
 - Underground Coal Mining Equipment
 - Open Cut Mining Equipment
 - Hard Rock Mining Equipment
 - Conveyor Equipment

The number of people that are scalded each year from removing radiator caps is incredible. From research, it appears that each year, over 5,000 people are scalded in the USA from removing radiator caps.  I couldn’t get any accurate numbers from Australia, but the number is still very high.

In fact, there are countless Mining Safety Alerts about scald injuries from people removing radiator caps on mine sites in Australia.

A small Australian company, MineSafe, has now come up with a solution to this problem by designing a radiator cap that is impossible to remove without first releasing the pressure from the radiator using the pressure release lever.  Their main radiator cap has been specifically designed for use underground in mines.  The cap has no prohibited alloy components and is built robustly for the tough environmental conditions experienced at mine sites.

We all know that hard barriers are a much better control for preventing accidents than procedures.  These MineSafe Radiator Caps are a hard barrier.

These caps are inexpensive so there is no reason that they shouldn’t be fitted to every vehicle on a mine site.  In fact, they have models to suit most industrial radiators and also smaller versions to fit standard passenger vehicles.

For more information, you can go to the MineSafe Radiator Caps website, or call Jean or Brett on +612 6372-2579.

Xstrata Coal has continued its buying spree with the purchase of Anvil Hill and Austral Coal from Centennial Coal.  Helios Australia (a subsidiary of Xstrata Coal) has paid $1.86 per Austral share.  This means that Centennial will receive A$479 million from XStrata Coal.

Previously, Centennial Coal completed the sale of its Anvil Hill development to XStrata for A$454 million.

Centennial is using the proceeds of both sales to reduce debt and for capital management initiatives.

The NSW government has announced the approval of the controversial Moorlarben mine near Mudgee NSW.

The Greens were challenging the mine, stating that the mine will increase greenhouse gas emissions by 5.3 per cent a year and use 6.9 megalitres of water each day.

However, NSW Planning Minister Frank Sartor said “It’s just not tenable to refuse a coal mine because people might burn coal in China or somewhere else, unless we refused all coal mining”.

I agree with Mr Sartor.  We either mine coal, or we don’t.  There is no point singling out one mine for greenhouse gases just to stop the approval.

As Mr Sartor said when approving the Anvil Hill Mine earlier this year, “a black ban on new coalmine applications in New South Wales alone would devastate the economy, but, worse still, would achieve zero net benefit to climate change because our coal would be substituted with coal from elsewhere”. (Hansard 7 June 2007)

AIMEX 2007 was held at Sydney’s Olympic Park from 4 September to 7 September 2007. AIMEX is one of the largest mining exhibitions held in the world, and it is certainly Australia’s biggest.

Last time it was held in 2003, over 10,000 unique visitors attended the event. For those people that cannot make it to AIMEX, I will post some pictures on The Mining Blog.

AIMEX is an exhibition of BIG stuff and little stuff.  On the left is a picture of a BIG Atlas Copco Drill - I couldn’t even get the whole mast in the picture.

The mood at this year’s AIMEX is quite different to the one held in 2003.  This year, the general talk by many suppliers is that they wish that they had more resources to supply more of their product and / or service.  The mining boom is evident in the discussions going on in the halls.

At the exhibition, Bucyrus announced that the ‘DBT’ name would be replaced by the Bucyrus name effective 1 January 2008.  On the right is one of the Bucyrus / DBT longwall shields bound for China.

It was also interesting to see the number of new players in the underground mining scene.  One that surprised quite a few people was Valley Longwall International.  This group certainly has come a long way from its humble beginnings, and now incorporates the original Valley Longwall, Specialised Mining Equipment (SME), Specialized Mining Vehicles (SMV), Pit Top Conveyors, Tyton Conveyors, Uni-Rod, Juganaut and NBM.

To coincide with AIMEX, we are offering $50 off our Mining Marketing Consulations.  At $447, you will get some great insights into marketing to the Australian mining industry.  You can ask us just about any question relating to marketing to the Australian Mining Industry and you will get quick, professional advice.

Like our mottos says, we “open the doors to the Australian Mining Industry”.  What are you waiting for?

Get your Mining Marketing Consulation now

Anyway, back to the photos.  On the left is a picture of Joy’s new 2-metre support that was at the entrance to AIMEX.  Yes it is a monster.

Another aspect that I noticed (and quite a few others also mentioned to me) was that there was a noticeable absense of the really BIG open-cut mining equipment.

At AIMEX 2003, there was at least one really big truck.  There was also lots of other equipment being displayed in 2003.  I remember that MMD had a few sizers there.

The general consensus from the people that I spoke to was that companies were flat out keeping up with their orders, so they had no spare equipment to show off.

OK, lastly, I thought I would show a picture of a big bucket - with me in it! Pretty big teeth, huh? On the bucket, that is!

I was told that this bucket weighed about 40 tonnes.

Anyway, that will have to be it for now.  If you have any photos from AIMEX that you would like to share, feel free to send them to us.

In the mean time, don’t forget to get your Mining Marketing Consulation while we have the special offer running.

(Update No 2: 3 September 2007)

Have you been following the unfolding story of the rescue attempts at the Crandall Canyon mine? I want to share some links to video clips, pictures and other illustrations to help you understand the situation at Crandall Canyon. I will continue to update this as the story unfolds.

Current News:

Officials at the Crandall Canyon mine have announced that the search for the missing miners is now finished after drilling a seventh hole and still finding no sign of life underground.  This hole was drilled into the miners’ “kitchen”, but officials had expressed disappointment that the hole only revealed 7 feet of rubble.  They had drilled this hole because miners are trained to seek refuge here during a collapse.

 They had also sent a robotic camera down one of the holes, but only found mud.  In fact, they had to abandon the robot down the mine because it got stuck in the mud.

Here is a video taken down one of the boreholes that was drilled into the mine following the initial roof collapse:

(video courtesy of KUTV-2)

I have worked in Australian coal mines for almost 20 years, and have also gone underground at a few mines in the USA. I was surprised at the differencese in safety standards between the 2 countries. One example is the use of diesel equipment underground. In some US states, they cannot use diesel equipment underground, whereas in Australia, they have been using diesels for many years. On the other hand, I was amazed at the use of trolley-wire trains (complete with all the sparks, etc) underground in the USA. So, what about Emergency Response Plans (ERP)? In particular, here is a link to the Crandall Canyon ERP submitted to the Coal Mine Safety and Health District (CMSH) District 9:

Crandall Canyon Emergency Response Plan

This plan also contains a mine layout plan at the end of the document.  As you can see, the plan was approved by CMSH on 13 June 2007. The ERP’s are a requirement of the new Miner Act 2006. As you can see from the Plan, it is pretty comprehensive in terms of providing for sufficient Self Contained Self Rescuers (SCSR), directional life-lines, post-accident breathable air (PABA), trapped-miner maintenance materials, etc.

So what does the Crandall Canyon mine look like, and what are the conditions experienced at the mine? Well, for a start, this is a deep mine - in some places over 2,000 feet (600 metres) deep.

What does it look like on the surface?  Here is a short video showing the terrain overlaying the mine: