New Energy to acquire project near Codelco’s and BHP’s mines in Chile

Canada's New Energy Metals (TSXV: ENRG) announced that it entered into a letter of intent with certain arm’s length vendors to be granted the exclusive right and option to acquire an initial 70% royalty-free interest in and to certain exploration and exploitation mineral concessions known as the “Exploradora North project.”

The 84,750-hectare project is located in the II and III Regions of northern Chile along the prolific West Fissure fault system between the open-pit Escondida mine, the largest copper mine in the world which is owned by BHP and Rio Tinto, and Codelco’s El Salvador underground copper mine.

In a press release, New Energy explained that Exploradora North is also located immediately north and east of Codelco’s Exploradora deep drilling project, where near-surface resource reported 100 Mt of 0.3 Cu and 0.2 g/t gold.

According to New Energy, Minera Activa, a private Chilean company, recently announced positive results in the Exploradora district, and Brazil’s Vale is also actively drilling to the west of Exploradora North.

To move forward with the acquisition, New Energy Metals, through a wholly-owned Chilean subsidiary, will enter into a formal option to purchase agreement which contemplates that the Vancouver-based firm has to incur in exploration expenditures on the project of at least $15 million within 48 months of the effective date. The company will also have to pay $8.5 million an issue an aggregate of 11,500,000 common shares of New Energy Metals, all of which will be done in different installments or phases.

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Worker killed at Codelco’s El Teniente mine

A worker at Codelco’s El Teniente operation was hit by a rock and died on Sunday, Chile’s state miner informed.

In a media statement, the world’s No.1 copper producer lamented the passing of 58-year-old Pedro Enrique Mena Bolvarán, who belonged to the company’s Mining Division.

According to Codelco, the causes that prompted the rock to fall down at the Pilar Norte mine are under investigation.

“As soon as the accident took place, activities in the area were halted and emergency protocols were activated. First aid personnel came to the rescue and practiced CPR for over 30 minutes. However, their efforts were unsuccessful and they ended up confirming the worker’s passing. Authorities were also informed about the incident,” the miner’s statement reads.

The company emphasized that it maintains its commitment to improving safety measures and occupational health standards in its different operations.

El Teniente is the world’s biggest underground copper mine and the sixth largest by reserve size. It is located 80 kilometres south of Santiago in the Andes mountain range.

At present, the facility is undergoing an extensive $3.4 billion-expansion project called El Teniente New Mine Level project to extend its productive life by 50 years.

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Workers at Codelco’s Chuquicamata mine to vote on strike action

Unionized workers at Codelco’s Chuquicamata operation rejected on Saturday the miner’s final contract negotiation offer and announced that on Tuesday and Wednesday they will be voting on a proposal to go on strike.

In a communiqué made public via social media, the union’s leadership said the proposal presented to them by the world’s No. 1 copper producer was a 'joke' aimed at suppressing workers’ legitimate aspirations.

“It is clear that the company didn’t take into consideration the four axes, which were the foundations of this process, where two of them implied zero cost for the company. With this [proposal], it was confirmed that the administration’s goal is to impoverish and divide workers and punish those that have fought for workers’ demands in a fiercely and committed fashion,” the statement reads.

The proposal made by Chile’s copper giant to its workers includes bonuses of about $14,150 per worker but eliminates the early signing bonus and maintains the idea -from a previously rejected scheme- of a 1.2% salary readjustment.

Given that this was Codelco's final proposal, employees say that the protest action is the logical next step. However, the plan to go on a strike has to be approved by more than half of the 3,200 workers that belong to the three unions operating at Chuquicamata, so union reps are asking employees to show up to the polls.

“We also hope that the administration reconsiders both its behaviour and the value it attaches to its workers because the future of this negotiation and of Chuquicamata itself depends on them,” the brief states.

Chuqui -as workers call Codelco’s flagship mine- together with the nearby Radomiro Tomic mine produced 653,000 tonnes of the company's total 1.8 million tonnes of output last year.

At present, the state-owned miner is seeking to transform the 100-year-old open-pit deposit at Chuquicamata into an underground mine by 2020, when mining at the open-pit ends.

The $5.6 billion-switch is part of Codelco’s 10-year, $39-billion overhaul of its core assets, and it is expected to extend the mine’s life by at least 40 years. Annual production after the transition has been completed is projected to be 320,000 tonnes of fine copper and 15,000 tonnes of molybdenum.

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Chile’s Codelco brushes off rumoured copper output drop

Chile’s Codelco, the world’s No. 1 copper producer, has dismissed reports of a predicted 40% drop in production over the next two years due to declining ore grades and the switch of its flagship Chuquicamata mine to underground from open pit.

Instead, the mining company says it’s following a detailed plan that will allow it to keep copper output at current levels of around 1.7 million tonnes a year over the next decade.

"Codelco's mine plan is based on existing mines and projects , which will progressively and systematically replace our current operations,” it said in a statement.

Media reports Thursday said production at Chuquicamata would drop to around 182,000 tonnes by 2021 from 459,000 tonnes this year.

State-owned miner says it’s following a detailed plan that will allow it to keep copper output at current levels of around 1.7 million tonnes a year over the next decade.

The fall would impact Codelco's total production by around 4%, the articles stated.

The state-owned copper miner said that since mining at the open-pit mine ends in 2020, which is when the underground section begins commercial operations, it will able to keep productive capacity unchanged.

The $5.6 billion-switch of Chuquicamata to underground cave mining from open pit, part of Codelco’s 10-year, $39 billion-overhaul of its core assets, is expected to extend the mine’s life by at least 40 years.

Annual production from “Chuqui” — as it’s often referred as — after it has fully transitioned to underground extraction is projected to be 320,000 tonnes of fine copper and 15,000 tonnes of molybdenum.

Codelco, which hands over all of its profits to the state, holds vast copper deposits, accounting for 10% of the world's known proven and probable reserves and about 11% of the global annual copper output with 1.8 million metric tonnes of production.

Chuquicamata and the nearby by Radomiro Tomic mines produced 653,000 tonnes of the company's total 1.8 million tonnes of output last year, which was almost 4% less than in 2017.

Production decline, together with lower copper prices and higher costs, saw the company's annual profits drop by a third last year to $2 billion, not counting paper losses worth almost $400 million, as it wrote down the value of its assets, including its Ventanas smelter and the open pit at its Salvador division.

Ugly trend

The world’s main copper producing nations have been showing output declines this year, according to the latest monthly bulletin from the International Copper Study Group (ICSG).

Global production declined 2.4% in February 2019, when compared to the same month last year, with 1,515kt (19,749ktpa) of contained copper produced globally.

Chile led the pack with output down 7.1 % y/y to 415.9kt (5,412ktpa) while Peru, the second main global producer, saw its output fall by 5.1% y/y to 176.1kt (2,296ktpa).

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Codelco not giving away gold watches anymore

Chile’s Codelco, the world’s No. 1 copper producer, made headlines recently not for its production of the red metal but for putting an end to a centenary tradition.

For decades, the National Copper Corporation gave away expensive gold watches to workers that have been with the company for over 30 years. But the practice came to an end in 2019.

According to the local press and the agency AFP, when the Chuquicamata and El Teniente divisions issued a tender to acquire 451 Longines gold watches, the alarms were set off at Chairman Juan Benavides’ office. He decided to stop the process.

Of the watches, 383 have a market price of almost $1,500, while 68 of them have a market price of $2,215.

The tradition of giving away jewellery, however, may continue at Codelco’s headquarters, where the benefit is established in the collective contract negotiated with the operating union.

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Chile’s Codelco kicks off underground mining at Chuquicamata

Chile’s Codelco, the world’s No. 1 copper producer, has begun underground operations at its century-old Chuquicamata mine, ahead of schedule and with more than 8,000 tonnes of ore already extracted since early April.

Block-caving, originally planned for May, began at the end of March, the state-owned miner said in a statement. Ore is being initially extracted by truck before starting commercial production, in the second half of the year. By then, a conveyor belt will carry rock to the concentrator plant, 14 km away.

Chuquicamata Division’s general manager, Mauricio Barraza, said that the commencement of mining underground was a “symbolic milestone” in the transformation of the mine, Codelco’s second largest.

Annual production after the full transition of Chuquicamata mine to underground extraction is projected to be 320,000 tonnes of fine copper and 15,000 tonnes of molybdenum.

The last blast at the bottom of the open pit was carried out in November, though copper extraction goes on. The company has said it plans to gradually decrease activities there until mid-2020, when the very last explosion is projected to happen.

The $5.6 billion-switch to underground cave mining from open pit, part of Codelco’s 10-year, $39 billion-overhaul of its core assets, is expected to extend Chuquicamata’s life by at least 40 years. It will also allow the copper giant keep production rates, despite falling ore grades and increasing costs at its operations.

Annual production from “Chuqui” — as locals call it — after it has fully transitioned to underground extraction is projected to be 320,000 tonnes of fine copper and 15,000 tonnes of molybdenum.

Codelco, which hands over all of its profits to the state, holds vast copper deposits, accounting for 10% of the world's known proven and probable reserves and about 11% of the global annual copper output with 1.8 million metric tonnes of production.

Chuquicamata and the nearby by Radomiro Tomic mines produced 653,000 tonnes of the company's total 1.8 million tonnes of output last year, which was almost 4% less than in 2017.

Production decline, together with lower copper prices and higher costs, saw the company's annual profits drop by a third last year to $2 billion, not counting paper losses worth almost $400 million, as it wrote down the value of assets including its Ventanas smelter and the open pit at its Salvador division.

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Still a way to go to achieve gender balance in the mining industry

Following the gender session held this at this year's PDAC, where gender balance in the industry and the #MeTooMining initiative were discussed, the Responsible Mining Foundation issued a summary report related to the topic.

The summary is based on a chapter of RMF's 2018 Responsible Mining Index and it presents an assessment on the performance of 30 of the most important mining companies in the world when it comes to the properly integrating women into their workforce.

"The RMI 2018 results reveal that most of the 30 companies assessed show little or no evidence of efforts to strengthen the gender balance of their leadership and governance teams," the summary reads. "The companies scored an average of only 4.5% on the question of implementing interventions to bolster the diversity and inclusivity of their boards and senior management. These results tie in with other research that has shown very low levels of women's participation at these levels."

Chile's Codelco is a good performer when it comes to gender issues as it has established company-wide principles and guidelines on the provision of gender-appropriate bathrooms, changing rooms, work clothes, PPE, and rooms for women workers to express and store breastmilk. Photo by Codelco.

According to the Switzerland-based non-profit, there is also room for improvement beyond board and senior management levels as their estimates suggest that women occupy approximately 10% of jobs in the large-scale mining sector.

"Gender-based bias and discrimination in hiring practices play a role in this, as do work schedules that interfere with family responsibilities and cause social isolation, making mining work unattractive for many women," the RMF document states.

The organization based the previous statement on its experts' believe that there is persistence of old paradigms within the industry, such as the outdated idea that women are not strong enough to work in underground mines.

For instance, the report brings back the fact that South Africa repealed a ban on women underground miners just a decade ago while India did the same only this year.

In the RMF's view, companies stand to benefit from having more women in their workforces. "Higher female workforce participation can also raise attendance and retention rates and reduce organisational risks within businesses. Mine managers cited that greater gender diversity fostered innovation and improved team dynamics and communications."

The NGO refers to managers in companies such as BHP, where there is a plan of action to achieve gender parity in all divisions by 2025, and Newmont, where the plan is to achieve gender parity in senior management by 2030, with a near-term goal of women holding at least 30% of senior roles. Similar targets exist at AngloGold Ashanti and AngloGold American.

The gender chapter in the Responsible Mining Index concludes with a call to increase safety measures for women working in the mining industry, particularly after a Canadian study revealed that almost 40% of women working in mine sites reported having experienced harassment in the last five years.

"It is at the mine-site level where women are most vulnerable to unsafe and hostile working conditions," the dossier reads. "The RMI 2018 results show that the vast majority of the assessed companies are unable to demonstrate that they have systems in place to ensure the provision of gender-appropriate PPE [Personal Protective Equipment] for their women workers: over 75% of the companies assessed scored zero on this question. And while many have policies in place to prevent sexual harassment, 75% of the companies show no evidence of systematic measures to prevent harassment of women workers."

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Immersive Technologies recognizes two for mining business improvement

Immersive Technologies has announced the winners of its Global Business Improvement Award 2018. Marking the tenth year in which Immersive Technologies recognizes the most outstanding real results achieved by mining companies utilizing simulation as a key driver in the business improvement process.

Finalists are selected for their achievements in continuously improving operational safety, efficiency and productivity through strategic simulator-based training initiatives.

Peabody Energy, a U.S. coal miner, was top of the surface mining category. As part of their Run for Reliability program, Peabody targeted multiple objectives related to safety, haul truck spot times, and equipment abuse events that lead to unscheduled maintenance. Peabody and Immersive Technologies partnered on a managed service solution which embedded an Immersive Technologies training specialist and analytics support within the mine’s continuous improvement team. Results achieved include an 11% spot time improvement and a reduction of 36% in operator induced machine abuse events which led to cost avoidance savings.

Codelco’s Chuquicamata, a Chilean copper mine, won the underground mining category. Codelco utilized simulation to conduct a baseline training needs assessment of their LHD and longhole production drill rig operator workforce. The insights from the initial operator assessments facilitated the deployment of a strategic training program, targeting specific operator behaviors. Results achieved include a 49% improvement in LHD and a 56% improvement in jumbo operator behaviors related to safety, production and unscheduled maintenance costs.

(This article first appeared in the Canadian Mining Journal)

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Chile’s Codelco to boost production at El Teniente copper mine

Chile’s state miner Codelco, the world’s No.1 copper producer, plans to boost production at its El Teniente mine to more than 500,000 tonnes per year by 2025, a first in the operation’s history.

The production increase would position the mine, which produced 465,000 tonnes of the red metal in 2018, among the world's five largest copper operations, local paper El Mercurio reports.

El Teniente is the world’s biggest underground copper mine and the sixth largest by reserve size. 

As part of the plan, Codelco — which hands over all of its profits to the state — aims at raising the annual surplus generated by the El Teniente division by 20%. Currently it contributes about $1 billion.

The miner also expects to reduce the division’s cash costs, with the goal of setting them at $1 per pound of copper.

El Teniente is the world’s biggest underground copper mine and the sixth largest by reserve size. Located 80km south of Santiago in the Andes mountain range in Chile, the facility is undergoing an extensive $3.4 billion-expansion project called El Teniente New Mine Level project to extend its productive life by 50 years.

The expansion, expected to be completed in 2013, is part of an ambitious, 10-year, $39 billion investment drive at Codelco to open new projects and overhaul older mines.

The state-miner holds vast copper deposits, accounting for 10% of the world's known proven and probable reserves and about 11% of the global annual copper output with 1.8 million tonnes of production.

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