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Renewables a natural choice for powering mining’s future - the case of Agnew - Mining Australia

Tuesday, 4 August 2020

Gold Fields and OZ Minerals are two companies spearheading the mining sector's move to renewable energy. Vanessa Zhou speaks with executives from both companies about their ambitions.

The COVID-19 pandemic didn't slow construction of Australia's largest hybrid renewable energy microgrid. South African miner Gold Fields and its energy partner Energy Developments (EDL) were in the midst of commissioning a wind farm at the Agnew gold mine in Western Australia when the pandemic hit. 

Five wind turbines (see cover), each soaring 110 metres high, were in line for commissioning. They form a key part of the Agnew hybrid renewable energy project, the first in Australia to use wind generation at a mine site.  

The wind turbines will contribute to the production of 18 megawatts of power, alongside a 25-kilometre gas pipeline, a 16-megawatt gas plant to underpin demand, a 13-megawatt battery unit generating four megawatt of power an hour, and a four-megawatt solar plant made up of 10,000 panels.

Despite requiring specialists to fly in from all over Australia for the commissioning, and the trucking of components more than 600 kilometres from Geraldton to the Goldfields site, the team overcame COVID-19 challenges to deliver the project a month ahead of schedule.

"We just had to be agile in the way we finish it. Thanks to the incredible team that we have at EDL, we made it happen," EDL chief executive James Harman tells Australian Mining.

Now the wind turbines have become part of an impressive sight on the drive around the Agnew operation, according to Gold Fields executive vice president: Australasia, Stuart Mathews. No gas or emissions are coming out of the massive power stations anymore, either. 

"The Agnew mine feels like it has been brought to a brand new, state-of-the-art operation. People from all other sites want to work on the site now," Mathews says, laughing.

"In our company, climate change is something that we have to manage. We believe we have to manage it because our people believe in it and want us to be doing something to contribute towards its change."

Harman says that wind energy is the key to delivering in excess of 70 per cent renewable penetration at Agnew. 

Gold Fields is set to save around 40,700 tonnes a year of carbon dioxide emissions from this year. The renewable energy will cater for more than half of Agnew's energy needs and will do so more reliably than its old power supply connected through wire.

The end of a power agreement provided Gold Fields with a "perfect opportunity" for the project. The business case was strengthened by a promising strategic outlook for the Agnew mine. 

Over the past five years, Gold Fields has committed around $100 million to exploration at the Agnew mine. Mathews says the company has been "seriously rewarded" by this investment. 

Compelling as the Agnew prospects were, Gold Fields decided to invest in a new accommodation camp for all of the mine's workers as well. They no longer have to live in a regional town anymore and are near the operation instead.

"We have good visibility that our mine is going to grow beyond its present reserve, so that gave a sense of confidence to our board of management to approve this hybrid power solution, as well as a brand new camp," Mathews says. 

"These are worth $150 million of commitment alone. We've been in Australia for almost 20 years and our view is we will be here for another 20. We're not here for the short term."

Gold Fields' tenements at Agnew span across more than 600 square kilometres. Its 2018 mineral reserves stood at 560,000 ounces, before the company expanded the operation by spending $25 million in exploration the following year.

Mathews says the company wouldn't have been able to meet the power demand of Agnew with its growth ambitions.

"The existing infrastructure around Agnew is old and needed a major capital injection to renew it. So this presented us with the opportunity to go alone and stand on our own two feet as far as long-term power supply goes, to secure the future of the Agnew mine," Mathews says.

"Our operating expenditure on energy alone (was) around 15 per cent. That's a big cost. Our mines are regionally located so it is sensible to come up with a standalone solution rather than running a big electric power hundreds of kilometres away at a great cost. 

"You can do something at your site that makes some sense. You can add on to it too."

Gold Fields has chosen a modular power design at its Western Australian mines, including at the Granny Smith operation. This allows the company to bolt-on additional things such as wind turbines, solar and energy storage as technology improves.

The maintenance is also described as very simple, with the entire plant run by two people on-site, who can also work remotely.

At the Granny Smith mine, Gold Fields has chosen Aggreko to build an eight-megawatt solar farm and in-house modular two-megawatt lithium-ion battery unit.

This arrangement is expected to slash 9500 tonnes of carbon dioxide emissions and the mine's fuel consumption by 10-13 per cent.

"Our people are incredibly proud of the fact that we've taken a leap of faith and are doing something completely different to power our mine sites," Mathews says. 

Gold Fields will not stop there. It also plans to shift to electric vehicles in the next five to 10 years and wean itself off a diesel reliance, using gas as a key transition fuel to get there.

"We're very, very impressed with Gold Fields' approach to partnership and sustainability," the chief executive of EDL, which has been supplying power to remote mine sites and communities for 30 years, says. 

"They call themselves a sustainable miner and I really believe that they are. They took a leap of faith and cut the wire that connected them to their old power supply. It was a big call on their part because they'd had that for some time. 

"We operate in five territories – the United Kingdom, Canada, the United States and Greece – but what we've achieved at Agnew is a highlight for EDL. To reliably deliver 70 per cent of renewable energy to meet the mine's power requirements is game changing."

As the mining sector looks to reduce its carbon footprint, Harman has witnessed an upsurge in projects aimed at replacing diesel use in vehicles. The producer of renewable and clean gas is working with multiple mining companies to replace diesel with cleaner, renewable LNG.

The Western Australian Government is also supporting an EDL pilot project that is testing the feasibility of powering remote mine sites with hydrogen. 

"Importantly, it's green hydrogen that is produced by renewable energy," Harman says. 

"We're in a time of transition and all the big companies are doing the right thing in reducing and committing to lower carbon emissions.

"But one of the challenges is to get senior management to focus on a smaller project to help them green up a mine site."

OZ Minerals appears to have overcome this problem as it moves towards incorporating renewable energy at both the Carrapateena and West Musgrave operations in South Australia and Western Australia, respectively.

"Our largest, Carrapateena and Prominent Hill operations are connected to the South Australian electricity grid, which is estimated to comprise 50 per cent renewable energy," OZ Minerals managing director and chief executive Andrew Cole says.

A trial installation at Carrapateena is planned to produce a 250-kilowatt hybrid energy solution, consisting of solar, wind, battery storage, connected to existing diesel generators and a smart grid controller for data access and tracking.

Similar to the problem Gold Fields encounters at Agnew, infrastructure in South Australia's regional areas does not support OZ Minerals' current activities and future expansion plans.

Renewable energy has also become the answer to the historical challenge of obtaining affordable power at the West Musgrave nickel-copper joint venture with Cassini Resources.

"We believe, supported by the views of potential renewable energy suppliers, that 70–80 per cent of the power needs for West Musgrave can be supplied by renewable sources, supplemented by battery storage and diesel or trucked gas-fired generation," Cole says. 

OZ Minerals, which has committed to achieving net zero carbon emissions by 2050, is also investigating a gas pipeline as its secondary option at West Musgrave. 

The company plans to reduce its footprint further by adopting vertical roller mills as a grinding mill solution. It also opts for a flotation flowsheet that achieves metal recovery at a much coarser grind size than what was previously considered in the design. 

"This lower power usage has resulted in a reduction in operating costs, while the use of dry grinding from the vertical roller mills has also resulted in an improvement in nickel recovery," Cole says.

Soluna Australia, Northern Minerals' partner at the Browns Range renewable project in Western Australia and 50-per cent owned by Lithium Australia, reinforces the importance of batteries as part of mining's energy mix.

"Batteries will always be an important component of a renewable project. Storing the excess energy just makes sense," Soluna general manager Kieron D'Arcy says.

"Batteries can be deployed elsewhere if necessary or can be recycled at the end of life." 

D'Arcy believes that no matter what role someone plays in society, most people will want a cleaner, greener plant.

"Nobody wants to destroy the earth. Mine operators have the same viewpoint in this regard," he adds.

"Taking on renewable projects is them doing the right thing for the planet and an economic decision. If one has a mine life of at least five years, they should be looking at renewable energy from an economic point of view."  

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