A very unique mine

It’s been a long time coming, but De Beers Canada is completing the commissioning of its Snap Lake diamond mine, 220 km northeast of Yellowknife in the Northwest Territories.

A year ago the project was suffering from transportation challenges and cost escalation (“Step Dancing at Snap Lake”, CMJ October 2006), but there is only good news today. The capital costs are under control, coming in as expected, and both the mine and the mill are operating,with the cushion of a large ore stockpile on surface. The push now is to beat the schedule: while the plan a year ago was to ramp up ore production to 3,150 tonnes/day by July 2008, De Beers now expects to get there before the end of this year. Snap Lake has already hired close to 350 of their 412 permanent employees. When contractors are included in the count, the full complement of workers at the mine will be close to 500 employees by year end.

And the best news of all is that the plant is producing diamonds–big ones–proving that the development of Snap Lake was a wise decision.

Upon opening, Snap Lake will be Canada’s fourth diamond mine, following the openings of BHP Billiton’s Ekati mine (1998) in the Northwest Territories, Rio Tinto’s Diavik mine (2003) also in the NWT and Tahera’s Jericho mine (2006) in Nunavut. But Snap Lake is unique, as the first totally underground diamond mine in Canada (although the Ekati mine has an underground component, and Diavik mine is opening its own underground mine).

CMJ interviewed De Beers Canada’s president and CEO Jim Gowans (JG) as well as its vice-president for the NWT, Chantal Lavoie (CL), in mid-September about progress on the Snap Lake project. Following are excerpts from that interview.

CMJ: How has construction gone in the last 12 months?

CL: It’s been going great. The costs are essentially on budget. This year we had a great winter road. At the beginning of this summer, the De Beers crews started moving to site, and taking over some of the aspects from the construction team. Right now De Beers has taken over ownership of the process plant. We’re slightly ahead of schedule: we’re on the last leg of our commissioning, about to start production. We produced our first diamond on August 22nd, which was a great achievement for everybody. We said that we would be ready Oct. 1st, and it looks like we’re going to be ready before. We still have the infrastructure underground to complete including the crushing plant, which we’ll be targeting completion by the end of the year. And the administration building is being finished off and some of the shops too.

JG: We were certainly under cost challenges a year ago when we had to go back to the well. We’ve done extremely well while having to compete against the oil sands industry in the south. We’re really pleased that we have managed to hold the costs to our target of about $975 [million].

CMJ: Tell me about your first diamonds.

CL: The first one weighed four-and-a-half carats, very soon after we had a pretty nice eight-carat stone, and more recently we produced a 42-carat stone.

JG: I had to eat a bit of crow at our executive meeting a couple of weeks ago. We’d run about 2,500 tonnes through the process plant because they were just tuning circuits, and we’d produced a few diamonds including an eight-carat diamond. It was almost flawless; it’s an absolutely spectacular-looking diamond. Then our vice-president of Canadian projects, Doug Scott said, “Statistically you should be getting something over 30 carats.” And I told him that he’s dreaming in Technicolor to think that we’re ever going to cough up a 30+ one in the statistically exhibited time frame. About two days later Chantal [Lavoie] sent me a picture and said, “By the way, here’s a 42-carater.” So I’ve been eating crow for the last two weeks.

CMJ: How about the mine?

CL: The method we’re using at Snap Lake is selective, somewhat of a room and pillar.

JG: The drilling and blasting is kind of standard, but it’s evolving too. As they get a bit of experience, they are starting to look at other options like panel mining. We’ll let the guys feel their way through over this first year, making improvements to the dilution and increasing the recovery of the orebody. We’re looking at bringing in the first fleet of low-profile equipment this winter, so it’s more like reef mining in the platinum area in southern Africa.

CL: The underground is ready to start production. Now that we’ve got the guys who are actually going to be mining the orebody, and some of them mined similar orebodies such as in the Elliot Lake area, they are coming up with a lot of very good, practical ideas. They are finding ways to improve the efficiency of the method and decrease the dilution. These are significant improvements over our business case, at very minimal capital investments.

Right now we’re producing at about 1,000 tonnes/day and will ramp up. We’ve got over 250,000 tonnes of stockpiled ore on surface, and are preparing five stopes for production. The challenge we gave everyone is to ramp up [the mine and the mill] to 3,150 tonnes/day between now and the end of the year, whereas the plan was calling to reach that level by mid-July of next year. Once the plant is ready to start, we want to feed it directly from underground production plus the material from the surface stockpile.

JG: The underground crusher chamber is being built now, and a conveyor that comes up from underground, scheduled to be finished around the end of the year or early January. That will save money on the truck haul.

CMJ: Have there been any modifications to the processing plans?

CL: In general it’s working as planned. Obviously small adjustments are being made, but the commissioning has gone very well. One of the things we’ve done is commission the entire recovery part of the plant way ahead of schedule. We did that in June and July of this year. Because it’s very high tech, very sophisticated, it required more time. This required feeding the recovery area manually. Once it was commissioned, we then concentrated on the front end of the plant. That allowed us to start the process plant slightly ahead of schedule.

CMJ: Did any of those big diamonds come out from the hand-feeding?

CL: When we were commissioning the recovery area, the only feed we had was tailings, so we actually brought back 180 carats of real Snap Lake rough diamonds that we had already recovered, and fed them into the system mixed with other rocks. We recovered every single one of them, plus a few little ones out of the tailings.

JG: It was a bit of a joke, because they sent us the first picture in June that they got the first diamonds. It was actually a couple of little wee, tip of the pen-size diamonds.

CMJ: You got your first new diamonds from the plant in August. When do you say that production has actually begun? What does that mean?

JG: We’re all over the map on that one. Our target is to be ahead of schedule on our ramp up, which was originally nine months (to the middle of next year). We intend to be up to better than 3,000 tonnes a day, before that. But what do you consider to be “in production”–I would say probably some time in November when we’re running around 2,000 tonnes a day. [At press time, De Beers confirmed they had achieved production on Oct. 1st, 2007.]

CMJ: And I guess it really depends on what size diamonds you’re getting out, does it?

JG: The bigger the better, of course, that goes without saying. Our guy from London came over and said the quality is coming in around what’s expected, so that’s positive. The size distribution seems to be coming in on spec as well.

CL: The ore at Snap
is all the same phase: hypabyssal kimberlite. We’ve got some brecciated areas, but for all the sampling we’ve done, we’ve never noticed a real difference … it isn’t an issue.

JG: When you talk to the mineral resource guys, they’ll tell you that it’s all fairly uniform in distribution and quality and grade, because of the fact that it was one species that came in. Snap is a very unique mine, in terms of the diamond business.

CMJ: I understand that the Snap Lake community relations phase wrapped up in April.

CL: Yes, we signed our fourth and last Impact Benefit Agreement with the Lutsel K’e Dene First Nation in April. Since then obviously we’ve been working to ensure that those IBAs are implemented.

The IBAs resulted in long-term contracts, most of which are now in place. The North Slave Metis Alliance is our supplier of shotcrete for underground and grouting chemicals. The Yellowknife Dene First Nation provides the camp and catering services. The Tlicho Nation is providing us with site services–the road grading, snow cleaning, transport logistics during the winter and the winter road–and is the supplier of explosives. The Lusel K’e Dene First Nation has a contract for the operation of our processed kimberlite containment, providing the operators for that facility as well as construction every year to raise the containment dikes.

We have a lot of commitments around training opportunities, scholarships and employment, which we’ve been focusing on as well. We’re actually going to have our first wave of eight trainees for the process plant coming in this month. Their training program at Aurora College in Fort Smith is run in partnership with the Mine Training Society and the North Slave Metis Alliance, and the program is open to all Aboriginal people in the NWT.

CMJ: Tell me about the recruitment program.

CL: We identified early on that this would be one of our biggest challenges, but we’re doing great right now. Our workforce is going to be around 500, 412 of whom will be De Beers employees, and we’re already at 350. Most of the senior management and all the technical positions are placed. What remains are some trades people, maintenance people, heavy duty mechanics and electricians, and then miners.

The mining area was probably one of our biggest concerns. We managed to recruit some of the miners who were already working at site with our contractors. As well, we had a very good turnout of people from northern Ontario, northern Saskatchewan and Alberta. We must have gone through more than 5,000 or 6,000 rsums.

JG: You know, the one that kept me awake the most at night was our ability to recruit good people for both the mines–Snap and Victor [the latter in northern Ontario]–because we were in the process of starting them both up ahead of schedule. My concern was whether we could get people on board and up to speed in terms of training. You can’t go out on the street and hire an experienced diamond plant operator, so you have to do a lot more training and development up front. I’ve been really pleased at the response that we’ve been getting and the effort that our operating people have put into recruiting top people. It’s really gratifying that we’ve been able to get quality people with experience, motivation, lots of pride in their efforts and happy to be working for us: the whole picture.

CMJ: What will the opening of Snap Lake do for the De Beers Group?

JG: This is De Beers’ first mine in production outside of southern Africa in its [119-year] history. For us it’s no big deal here, other than we’re excited that it’s our first mine in Canada. But for De Beers Group this is a pretty significant event. It turns De Beers into a world miner. De Beers is the largest [diamond] miner, but we’ve been pretty well southern Africa-centric until Snap comes into production. With our two mines coming into production in Canada [Snap Lake and Victor] in the next six months or so, this is quite a change for the company.

CMJ: Do you think that will be reflected in how the company operates in the future?

JG: Yes, I think so. We’re considered to be one of the major growth vehicles in De Beers, and I don’t think that’ll change. At the end of the day, it’s wherever you find the next orebody fastest.

CyberMINE underground simulator arrives

“Simulators have a future for training on underground mobile mining equipment, for sure,” says Peter Larsen, vice-president of exploration for Sandvik Mining & Construction. Larsen is describing the CyberMINE simulator that was delivered to Sandvik’s Yellowknife office the beginning of September.

There is a need to find safe and innovative ways to meet the growing training challenge that is of prime concern to our industry. This was first quantified some 30 months ago in meetings between Sandvik and Snap Lake owner De Beers Canada. Among other hurdles, the challenge at Snap included aggressive Northern employment targets, growth and jobs for First Nations peoples and a significant lack of skilled workers in the NWT. A ‘better mousetrap’ was required, so the simulator project began.

Sandvik turned to Thoroughtec, based in Durban, South Africa, for its expertise in designing and manufacturing realistic equipment simulators. For about US$800,000, Thoroughtec created the most sophisticated underground training simulator and software in the world, capable of training on four types of equipment–a 40-tonne truck, a 4.5-m3 load-haul-dump machine, a two-boom jumbo and a bolter–with realistic graphics that accurately depict the Snap Lake mine.

The student sits in a replicated cab containing all of the instruments and working controls accurately located for the specific unit. (The four sets of controls can be used by the student and the coach.) Facing three high-resolution, widescreen displays, the student operates the unit and is marked by the coach as well as electronically through a series of sensors that pick up operating habits. An external viewing screen allows others in a classroom to see the student’s view and learn in parallel.

Now that the simulator has arrived, the De Beers/Sandvik team will be fine-tuning the curriculum for each equipment type plus for multi-training. Results at the launch showed that simulator training would take about the same amount of time as training on real equipment, but would be considerably more effective and quite an enjoyable experience.

Besides being fun, there are obvious advantages in using a simulator for training, retraining and checking competence. The simulator provides a safe, quiet learning environment that also transcends literacy barriers. At the same time, training does not use real equipment and underground space, so it does not interrupt valuable production time in the mine. The trainees are expected to reach 80% competence on the jumbo drill using just the simulator: much further than had been anticipated.

Now that he’s seen CyberMINE in action, Larsen says the attention to detail including accurate shadowing makes the view “so real that it’s staggering”. There are currently 40 students on the simulator, half of them novices.

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