Jane Bordenave talks to Karara Mining Ltd about its Iron Ore Project and what makes it different from other ore projects.
Karara Mining Ltd was established as a joint venture in 2007 between the Australian mining company Gindalbie Metals Ltd and Chinese steel manufacturer AnSteel. Its primary function is to develop the AU$2 billion Karara Iron Ore Project, but will also be used as a vehicle to look at other future opportunities.
The ore body at Karara offers the potential for a very long mine life, which was attractive to both Gindalbie Metals and AnSteel and the deciding factor in forming the joint venture. However, this ore body is not hematite, the type of ore normally found in Australia; it is magnetite. “Processing magnetite in Australia is something of a challenge for us and the project,” says Peter McBain, general manager of development for Karara Mining Ltd. “The process in itself isn’t difficult and it has been used a lot in other countries like China. But in Australia, people are used to working with hematite, which requires very little processing, whereas magnetite is a more value added product. So there is a period of adaptation that is needed.”
The period of adaptation will be worth the effort, however; the processing plant will initially handle 20 million tonnes of feed per annum, which will be converted into eight million tonnes of concentrate, but the long-term plan is to quadruple this output.
The project also has multiple benefits for the local community. While the mid-west of Western Australia is emerging as the next mining precinct in the region, the Karara Mining Project is the first major operation to get started in earnest. “We have committed over AU$750 million in contracts and orders and have spent upwards of AU$400 million,” says McBain. “We have also dedicated half of our AU$2 billion project budget to developing regional infrastructure. We are about to start building roads, some of which will be paving existing gravel roads, some of which will be completely new. We’re also laying 130km of water pipelines, a 180km long, 330KV power line and we are putting in an 85km rail spur. On top of that, because we will be using some of the existing grain rail networks in the area, we’ll be upgrading them.”
McBain is also enthusiastic about the effect that the project will have on the local economy and population, providing jobs, attracting people to the area and stimulating all areas of the local market, including those unrelated to mining.
Karara Mining Ltd will be outsourcing the majority of the physical on site work, ie, construction and extraction. Although it will be supervised by the senior management team at Karara, the company prefers its subcontractors to have a degree of self sufficiency. “We have a dedicated contracts and procurement department which deals with the identification of potential suppliers for services or packages,” explains McBain. “We look for companies that have a similar culture to us in terms of safety and quality, care for the environment, commitment to communities, as well as ensuring cost effectiveness and timeliness.”
Safety is something that Karara Mining takes very seriously and about which it is very proactive. The company believes that the first and most important step in managing safety and risk is to engage and empower all the individuals working on site, giving them the responsibility to manage safety in and around their area, as well as helping others. To do this, everyone is expected to report any hazards or potential risks they see on site, to make sure they can be dealt with and mitigated. There is a full induction process, and all people working on site are expected to be accredited by the national framework for skilled workers and operators, showing that they are competent to work in their position.
“On top of these qualifications and initial inductions, we also have a strong fitness to work scheme, where we ensure no one is under the influence of alcohol or drugs or is impaired by fatigue. In fact, our rosters are worked out in such a way that we ensure all our workers get enough rest, giving them more home time than some other similar sized projects,” says McBain. “We have regular safety meetings, including a weekly toolbox meeting to discuss issues and outcomes. There are also safety committees, which are comprised of a 50:50 split between workers and management, so that we can keep a balanced focus.”
The company runs what McBain calls a ‘front-led safety culture’, focussing on hazards that have been identified and dealt with and what has been done in terms of prevention, rather than accidents that have happened over the year. However, he acknowledges that, of course, this second part is also important. “At the end of the day, that is the final scoreboard, but we want to build on our successes and what we have done right in order to bring those figures down, rather than what went wrong.”
For the future, the company’s immediate focus is on completing site construction and getting the project moving. There are also hematite deposits around the main ore body, which the firm hopes to develop, mine and ship as soon as it can. Once all the infrastructure and equipment is fully in place for the main mine, the next stage will be a process of increasing capacity. “Over the next 10-11 years we will be working to steadily upgrade the mine and production facility, raising our output from the initial eight million tonnes to 30 million tonnes. However, this will be very much a logical and progressive development, rather than trying to rush things all in one go.” Once the Karara Iron Ore Project is well under way, the organisation will also begin to look at the possibility of opening other mines in the territory and engaging in some of the down-stream, value added processes.
Karara Mining Ltd is breaking new ground by opening up the mid-west as the new centre of mining, and establishing a foothold for magnetite processing. As the first company in the country to mine and process this mineral, it is building up a knowledge pool that will enable it to expand both the Karara mine and other areas. http://www.gindalbie.com.au/Our+Projects/Karara+Iron+Ore+Project/default.aspx
