Kennecott Utah Copper Still Studying Ways to Keep Mine Operational for Next 30 Years
By Olson, Debbi
Since 1906 Kennecott Utah Copper’s Bingham Canyon Mine has been an important player in Utah’s economy by being a major employer, a major supplier of resources used by members of the community and through its philanthropic contributions into the community.
“Kennecott has a great standing in the community and we want that to continue,” said Andrew Harding, who took over as chief executive officer of KUC in October 2007. “Causing the mine to have a longer life that allows us to be economically sufficient is expected to continue.”
Under Harding’s new leadership, and through a program called “Giant Leap,” which the company started roughly three years ago, KUC is looking to expand the life of the Bingham Canyon Mine past the formerly projected 2019 to 2036, based on new studies and technologies that may make it economically feasible to extract copper and other natural resources at the mine beyond what had been projected several years ago.
“We’re looking at a new pushback that would see us expanding to the south,” Harding said. “We know there is ore there that would allow the mine to continue to 2036. We’re doing an engineering study to see how we’re going to get to that, the approaches, to see if it’s economical to go there.”
The “Giant Leap” program includes a research team of 25 employees who are embarking on resource development using new technologies that will study addition-al pushbacks of the open pit and possible underground expansion. KUC is currently involved in a drilling program throughout the mine that provides data on what copper grade is there and what type and how much waste must be moved to access it.
“The economic conditions will also determine how we look at this option [of the new pushback],” Harding said. “This signals our intention, however, it has not been fully engineered yet, so it’s not guaranteed.”
If a new south pushback is approved by KUC’s parent company, Rio Tinto, work could begin as soon as 2010 to begin moving dirt, which typically takes five to six years before the copper is actually extracted from the site.
It is estimated that, to date, 17.5 million tons of copper have been extracted from the Bingham Canyon Mine, “and we still have that much left,” Harding said. “With today’s technology, I don’t expect that it would take us another 104 years to extract that same amount.”
The accessibility of that ore, and the quality of the grade. are also factors KUC considers in continuing mining operations.
“Bingham’s ore body is so widely disseminated that there are, below the surface, a number of areas that aren’t as well defined as they might be,” said Ted Hinebaugh, general manager of mining for KUC. “There is considerable mineralization that could extend that mine life, but, right now, it’s not economically proven. Bingham has a lot of mineralization to consider. What might not be economic today, because of technology, it may very well be economic tomorrow.”
In addition to the study of a new south pushback, studies are being done regarding the feasibility of underground mining – an option Harding said will only go forward when all other resources for open pit mining have been exhausted. The decision to go underground would come five to six years before the expected closure of the open pit mining process in order to make preparations for underground work.
“From the time we decide to go underground from the time we get the ore out of the underground mine, we think it will take about six years,” former KUC CEO William Champion said last year. “If we’re able to find additional open pit reserves then we can put that decision off [to go underground] by a few years or so before we would have to actually commit to that type of an operation.”
To keep the Bingham Canyon Mine operating economically, Harding has already implemented practices that continue to save the company money in operational expenses.
Prior to being named CEO in October, Harding was global practice leader for mining in Rio Tinto’s Technology and Innovation Group, where he focused on leading performance improvement initiatives. Those initiatives included finding ways to extend the life of tires on mining vehicles used at Bingham Canyon and obtaining better fuel efficiency. While tires may not readily come to mind as an important mining operation, the 80 trucks operating at the mine required new tires every nine months at a cost of $20,000 per tire, and each truck needed six tires.
“In 2004 tire makers informed the mining industry that they would not be able to keep up with the demand for tires in the mining industry,” Harding said. “We had to figaure out a way to improve the life of the tires so that we didn’t run out of tires and have a huge gap before getting replacements.”
Rio Tinto put Harding in charge of finding ways to increase the life of the tires. Improvements came through teaching drivers to be more proactive by not driving through potholes or over rocks that can damage tires, as well as creating a global ordering system company-wide, instead of per mine, so that all tires within Rio Tinto’s operations could be accounted for and used where needed rather than facing the possibility of one operation having an excess of tires not being used.
“In the first year we saw a 20 percent improvement,” Harding said. “We increased the life of the tires to about 6,000 hours, which is about a year instead of nine months. That has saved a lot of money, it was in the tens of millions of dollars.”
In other areas of operations, Kennecott has become one of the world’s lowest-cost copper producers. Its new smelter is the cleanest smelter in the world, capturing 99.9 percent of sulfur dioxide emissions. By re-using waste heat, the Kennecott smelter co- generates 60 percent of its own power needs.
The extension of the mine life also means that jobs will continue at Bingham Canyon for another 30 years. Currently there are approximately 3,000 people working for Kennecott in one form or another, with about 1,700 employees at the mine itself, making it one of the major employers in the Salt Lake Valley. In addition, the firm pays nearly $1 billion in taxes, which ultimately go back into the community. And last year the Kennecott Charitable Foundation donated $130,000 in support of 95 local charities.
The foundation raises money for local charities through tax- deductible entrance fees to the Bingham Canyon Mine Visitors Center. In 2007, the visitors center hosted 169,945 visitors, an increase of about 21,092 from 2006. Since the inception of the charity fund in 1992, the foundation has donated more than $2 million to local community charities and nonprofit organzations, and hosted more than two million visitors at the Bingham visitors center.
Additionally, KUC has donated approximately $500,000 to the Road Home, a Salt Lake City nonprofit that operates a homeless shelter and helps transition the homeless into homes. KUC has also provided approximately $600,000 in college scholarships for local universities and has given $100,000 to the Tracy Aviary to rebuild its facilities along the Great Salt Lake.
“We have re-commissioned a study of economic impact to see what Kennecott has done for this valley and if Kennecott was not here, what would this valley be like,” Harding said. “We’re still a power- house and we’re still a huge player and we think it’s important for the community to realize that.”
KUC is unusual in the mining industry because its large operational mine is in close proximity to a significant urban population.
“Because we’re so close to a large population it’s absolutely vital that we continue to be transparent with the community about everything we do,” Harding said. “It’s important to make sure the community knows what we are doing. Kennecott has a great standing in the community and we want that to continue.”
That also includes paying attention to the environment and sustainable development by ensuring the land will be usable after mining operations have ceased and taking care of environmental impacts created by the mining operations, both currently and historically. KUC is presently working with several municipalities surrounding the mine to clean up groundwater contamination and waste sites left over from previous Bingham Canyon operations before Kennecott and Rio Tinto owned the mine.
As part of its continuing commitment to clean up historic copper mining and processing sites in the Oquirrh Mountains, KUC is assisting property owners with the removal of contaminated sediments along the historic Bingham-Magna Ditch.
The Bingham-Magna Ditch was constructed and used in the 1930s to convey wastewater from Copperton to Magna over easements acquired by the Utah Copper Co., a predecessor of KUC. The ditch began west of Copperton, ran east to about 7000 West, then north along through what is now West Jordan, West Valley, Kearns and Magna. It ended at the Utah and Salt Lake Canal on the northwest side of Magna. The ditch was taken out of commission in approximately 1936 and filled in.
Kennecott is working with Utah Department of Environmental Quality (UDEQ) and the Environmental Protection Agency (EPA) to investigate the extent of arsenic contamination and any associated health risks.
While mining officials say they are confident that as long as sediments remain buried there is no risk to human health, the company prefers to remove the contaminated ditch sediments where possible. The work to remove ditch sediments will be done with full oversight from the EPA and UDEQ and in a manner that does not create risk of exposure to residents or neighbors.
Recently, development on the west side of the Salt Lake Valley has exposed portions of the ditch, leading the KUC’s decision to fund the multi-million dollar clean-up project.
“Balancing of the economics and the environmental are sound aspects to sustainable development,” Harding said. “We will continue to be involved in improving the environment in order to continue to be a good neighbor.”
Currently the Bingham Canyon Mine supplies 17 percent of domestic demand for copper. In the past year, the mine yielded 300,000 tons of copper, four million tons of sulfuric acid, 400,000 ounces of gold, 13 million pounds of molybdenum and three million ounces of silver. The mine is two-and-a-half miles wide and three-quarters of a mile deep. That depth is expected to plunge another 500 feet by 2015.
Copyright Enterprise Business Newspaper Inc. Feb 11, 2008
(c) 2008 Enterprise, The; Salt Lake City. Provided by ProQuest Information and Learning. All rights Reserved.