Modular plants in mining
With investment and capital hard to come by in the mining industry at the moment, Guy Richards looks at a possible solution – modular plants.
These are difficult times for the mining industry. Against a backdrop of the lowest commodity prices for years, big-name miners such as AngloAmerican and BHP Billiton have disclosed some eye-watering losses, and others such as Vale have been forced to write down the value of their assets. That, naturally, has been driving investors away from the sector, and if the problem has been an acute one for the major players, it has been even worse for the juniors and mid-tier companies, who do not always have the reputation or assets to raise even a fraction of the funding they need to continue exploration or develop a mine.
A key issue here, of course, is that once an ore body has been identified it needs to be mined and processed, but traditional process plants are costly to set up, and can take in the order of years to start earning their keep. A growing number of miners are therefore opting for modular, scalable processing plants, which take a matter of months, if not weeks, to be prefabricated away from the site and then shipped and assembled on site, delivering a consequently faster return on a smaller capital outlay than required for a traditional plant.
The right size
Venmyn Deloitte is a consultancy that carries out technical and economic assessments of mineral projects, and advocates the introduction of these plants. To clarify what is meant by a modular scalable plant, Managing Director Andy Clay says, ‘They are modular to the extent that companies can include various modules that offer downstream processing to the level desired. At a minimum, they would include a base scrubber, but could include various crushing, grinding and concentrating modules that can be added to the plant as and when needed. They are also scalable in that many small plants can be introduced, so that each runs in parallel.’
Also in their favour is the fact that they use processing plant items that are already available but that can be easily tweaked to suit a particular miner’s needs, rather than having to be tailor-made. Although that results in lower recoveries – from as little as three tonnes/hour (tph) up to about 250tph – than would be typically achieved with a purpose-made plant, they have that advantage of delivering a quicker return for less outlay.
Clay’s colleague, Senior Geologist Tarryn Orford, says, ‘The plants enable junior and artisanal miners to enter the market and develop towards competitive production without requiring huge amounts of capital. This supports growth in the mining industry, even during difficult periods. Being modular, the plants can also be smaller and easier to transport than conventional plants, and this is a great fit in countries where infrastructure is still developing.’
To this Clay adds, ‘This model of processing plant design also offers miners the flexibility to “right-size” their projects for adverse market conditions, such as those currently being experienced. Downstream modules of a processing plant can be shut down, as can complete processing streams, where multiple plants have been established alongside one another.
‘Shutting down downstream processing units or entire processing streams would enable mining companies to optimise their processing to cover the costs they need to recover to stay in business during economic or commodity-price downturns. This approach would allow companies to mine only a fraction of their ore bodies and resume higher levels of production when commodity prices recover,’ he says.
Not suitable for all environments
The plants are already proven in diamond, tin, gold, chromite and tantalite operations, but they are not suitable for all commodities. 'They are designed with a focus on physical separation of ore, for example gravity and flotation technology,’ Orford explains. ‘These techniques will be more suitable for certain ore bodies where the material can be extracted through physical rather than chemical means. Where chemical means would be necessary for extraction, the plants may be less effective or used in combination with other processing stages.’
Kevin Peacocke, CEO of technology supplier Appropriate Process Technologies, adds, ‘There are many private entrepreneurs in the diamond industry, and their preferred feed is surface alluvials. That requires that they move often to keep the trucking distances down, and modular plant are far easier to move.
‘Also, modular plants are very well suited to gold, and for a number of reasons,’ he says. ‘First, the vast majority of gold occurrences are as small, isolated deposits. The larger companies passed these over because they could not justify setting up permanent formal infrastructure and plant. Modular plants allow even modest resources to be treated, and the plant cost can then be amortised against the next one.
‘Second, the ore complexity changes as one moves to depth. A modular approach enables you to begin with a minimalistic simple solution to treat the upper horizon oxidised material and then add a milling module and perhaps cyanidation modules later on.’
On the point of plant set-up time he says, ‘The typical fabrication lead time for a 20tph alluvial gold plant, for instance, is around 14 weeks. Once the containers are on site, erection and commissioning takes about a week. For larger alluvial plants of around 80tph, the corresponding figures are 18 weeks and two weeks on site. If a cyanidation module is required though then that takes more time on site.’
Peacocke says demand for these plants is growing, and not just from the juniors and mid-tier companies. ‘Even when project capital was easy to come by, it made no sense to sink vast amounts into a very long term life-of-mine establishment,’ he says. ‘Apart from the variability of a start-up ore, this hugely expensive approach means the risks are correspondingly higher, so the degree of upfront certainty required is also much higher. To mitigate that, companies have to do much more proving, and that not only requires money, but time. The longer a project takes, the higher the exposure to social and political risk – it’s a vicious circle, and many of the larger players are realising this.
Modular plants can also be huge, though. Dick Wilkinson is a consultant mineral process engineer, with more than 40 years’ experience in the industry and, as he recalls, ‘There are a couple of nickel mines in New Caledonia that needed plants of up to 1,000tph, which had to be prefabricated at docksides in the Philippines and China because there were no skilled workers locally, and then shipped to the site. It’s another way to build a processing plant, so in a sense “modular” is a question of definition.’
All things to all miners
In this context, such plants are permanent, with a fixed processing function, but they can also be designed to be reusable rather than transportable. As Rob Bennett, Managing Director of minerals engineering consultancy ProMet Dadi, explains, ‘In China, for example, our company needed to supply a reusable, environmentally friendly modular processing plant for a series of short-life – less than 10 years – coal projects, where we could install the plant at one site then, at the end of the project’s life, dismantle the plant, move on to the next project and re-assemble and re-commission the plant. These plants have several in-built coal processing flowsheet options that allow flexibility in matching differing site layouts and feed material conditions.’
Resource nationalism is another factor in opting for a modular plant. Clay says, ‘This is becoming an important reality for mining companies to consider, and is true of many mining jurisdictions. Mining companies are uncertain of their long-term tenure in some countries, and judge it prudent to roll out their mining plans in a phased way that won't expose them to high financial risk in the event that their tenure is compromised.’
Amid all these pros, there are some cons, as Energy and Resources Manager at Venmyn Deloitte Gbenga Ojo points out. ‘In some countries, selective mining of high-grade deposits – which tends to occur with modular plants – is frowned upon. Also, the technology does not provide significant employment since, in some cases, fewer than five people are required to operate the plants, and creating jobs is an important aspect of managing community expectations.’
Clearly modular plants are not a panacea for the industry’s current woes, but they do offer a more cost-effective, flexible and sustainable way for miners to exploit a range of ore bodies and adapt to changing market conditions – and market conditions always change.