Amid the Australian gold price reaching $3680 per ounce on August 5, Evolution Mining executive chair Jake Klein predicted that the price will continue to soar.
“Since we emerged from the fog of COVID-19 in 2022 and the associated travel restrictions, I’ve stood at this podium for the last two years telling you that the price of gold would be higher the next time we meet,” Klein said while speaking at the 2024 Diggers & Dealers Mining Forum on August 6.
“And fortunately for me, I’ve been correct this year. I come with the same good news. I’m going for a hat trick: the gold price will again be higher in 2025.
“In an excellent recent research piece, Citigroup forecast a base case gold (price) for 2025 to be between $US2700 and $US3000 an ounce. That’s up between $US200 and $US500 an ounce from current prices.”
The predicted increase comes at a perfect time for Evolution, which has five Australian gold operations: two in New South Wales, two in Queensland and one in Western Australia. Klein shed light on how Evolution has advanced over the years.
“We’ve established an outstanding portfolio of gold and copper assets,” Klein said.
“10 years ago, Evolution had a market capitalisation of around $650 million, which is less than 10 per cent of our market cap today. Average mine life – based on reserves – was about seven years, and (we) were producing 440,000 ounces of relatively high-cost gold.
“Today, we have 33 million ounces of gold and 4.1 million tons of copper in resources. We produce over 700,000 ounces of very low-cost gold, and our average mine life – based only on reserves – is at least 15 years.”
Klein credited Evolution’s growth to its significant exposure to copper.
“We have added 75,000 tons of annual (copper) production. (We also credit) our very long mine lives with high quality ore bodies,” Klein said.
“The lowest cost investment and highest rate of return is always going to be organic growth. We don’t have to go out and buy new resources to grow production or to extend our mine lives. We already own them.”
In December 2023, Evolution acquiredChina Molybdenum Co’s (CMOC) 80 per cent stake in the Northparkes copper-gold mine in NSW. The purchase was the main driver of Evolution’s mineral resource growth.
“The attractions for us in 2020 were evident and remain the same,” Klein said. “(These include) a 30-year reserve life, an excellent team with deep technical knowledge of caving, great geological upside and immediate cash generation.
“The first seven months of ownership have exceeded our expectations in almost every way. We’ve generated $74 million of net mine cash flow, and there is a lot more to come.”
Evolution is currently implementing a lower capital-intensive sub level cave option at the E48 ore body within Northparkes. It is also currently sourcing ore from Northparkes’ E26 Lift 1 North block cave.
Klein said that Northparkes has “abundant resources” equalling a 70-years mine life, if all the resources are mined.
“Therefore, our focus is on near surface, high-grade mineralisation that can leapfrog its way into the production profile,” Klein said.
“And here, even having only owned the asset for seven months, we’re having great early success. This is undoubtedly an asset that would fit well in any gold or copper company in the world. And we are very, very happy owners.”
Subscribe to Australian Mining and receive the latest news on product announcements, industry developments, commodities and more.
Oz Pebbles owns two Anaconda machines including a DF410 and SR514. Image: Onetrack
Quarry recently spoke with Oz Pebbles about its experience with Anaconda equipment from Onetrak.
For more than 30 years, Oz Pebbles has been a premium landscaping supplier, wholesaler, and distributor of bulk decorative pebbles, sand, soil, and mulch.
Located in Southeast Queensland, its Gatton yard boasts approximately 25 acres of diverse landscaping pebbles available for collection or delivery.
The company serves customers across the Gympie – Wide Bay – Burnett region of Queensland, from its Kilkivan yard for bulk building stone and rock for retaining walls, cobblestone paving, landscaping, and pool sides.
In early 2023, Oz Pebbles became a part of Brisbane-based Sunstate Sands Group, a 100 per cent Australian-owned and operated company. Quarry spoke to Matt Holloway, operations manager for Oz Pebbles, about the company’s Kilkivan site, which holds a large stockpile of material from an old gold mine. Oz Pebbles’ materials range from 20mm gravel to 400mm rock. With a small team working on-site, the company needed reliable machines. Oz Pebbles currently have two Anaconda machines, a DF410 and SR514 from Onetrak.
The DF410 is designed for optimal screening and stockpiling of materials with one of the longest screen boxes in the compact screening market. Meanwhile, the SR514 is both robust and economical, able to screen and stockpile up to three products, up to 350TPH. It features a 14 x 5 screen box with an optional triple or double deck, a 14ft feed hopper, main conveyor, and either three or four hydraulically folding stockpiling conveyors. Setting up the screen is easy and can be done in just 20 minutes, thanks to hydraulic controls that aid in the configuration of all conveyors, screen-box, and landing legs.
Onetrak is the official dealer for Anaconda equipment in Australia. Image: Onetrack
Holloway shared his thoughts on their decision to purchase Anaconda machinery. Previously, Oz Pebbles had no Anaconda machines in its fleet, but the company’s general manager had a relationship with Onetrak’s Jason MacDonald and had previously worked with Anaconda. This was a significant factor in Oz Pebbles’ decision-making process. Additionally, Anaconda’s excellent reputation and the support of Onetrak’s national dealership, which offers service and technical expertise, just two hours from the site, were key factors.
Holloway said there were several standout features of Anaconda machines. Some of these include excellent fuel economy, easy mobility on tracks using a remote control, and the ability to screen three separate stockpile products from a single feed. Additionally, these machines boast a durable and solid construction along with good engine power.
Oz Pebbles regularly hears from operators who find the machines very user-friendly. Holloway said the units can easily fold up to be transported and are compatible with both front-end loaders and excavators for feeding the hopper.
“These machines have good ground clearance, which makes clean-up easy. Further, the screen can handle different feed sizes with ease, even after warning operators about putting oversized rocks in the hopper. “Adjusting the tail belt height to increase or decrease stockpile height depending on site conditions is also helpful,” he told Quarry.
“I must say, our experience with Onetrak’s service manager Chris Gardham at Caboolture has been nothing short of excellent.
“Whenever we have any issues or need services, Chris is always there to provide timely and fantastic support. When we had to transport the SR514 to Emerald for some work, Chris had no issues organising a crew to get the job done.
“Moreover, their parts supply is also great, and they are equipped to source parts and provide specialist service in case of any issues with the machine. At the beginning of the engagement, Jason did an excellent job commissioning and training on pre-starts and the do’s and don’ts of the machines. Their after-sales service has been top-notch.” •
Just five months after announcing its intention to acquire Alumina Limited, Alcoa has now officially taken the reins.
Alcoa president and chief executive officer William F. Oplinger welcomed the closure of the $2.8 billion deal, which will increase Alcoa’s ownership of core, Tier 1 assets.
“Alcoa is proud to announce the completion of our first major acquisition,” Oplinger said.
“The acquisition of Alumina Limited strengthens Alcoa’s position as one of the world’s largest bauxite and alumina producers and is expected to result in long-term value creation from greater financial and operational flexibility.
“I want to thank both the Alcoa and Alumina Limited teams, and our advisors, for full cooperation and diligence in closing this transformational transaction on a very tight schedule.”
With Alcoa’s acquisition of Alumina, the Alcoa World Alumina and Chemicals (AWAC) joint venture is now fully owned and controlled by Alcoa.
Alcoa previously held a 60 percent ownership interest in AWAC, which consists of a number of affiliated entities that own, operate or have an interest in bauxite mines and alumina refineries in Australia, Brazil, Spain, Saudi Arabia and Guinea.
AWAC also has a 55 per cent interest in the Portland aluminium smelter in Victoria, Australia.
Looking to the Alcoa’s Western Australian assets, the company reaffirmed its commitment to growing the sector.
“Alcoa operations in Western Australia are a key component of the company’s portfolio, and this acquisition deepens that commitment,” the company said.
The site is estimated to have reserves of more than 13 million tonnes of sand and will directly create 30 jobs.
“Bringing high quality sand to market will deliver important benefits to our infrastructure builds and is crucial to keep prices for construction materials down,” Resources and Energy Minister Lily D’Ambrosio said.
The materials from the Lang Lang quarry are expected to help projects in Victoria’s Big Build and residential construction projects. Quarry materials are crucial to new housing, infrastructure and renewable energy projects.
It follows several quarry approvals within Victoria, which began in 2023, as a result of the Resources Victoria Approvals Coordination (RVAC). The RVAC helped the Lang Lang site gain planning permission through the Victorian Government’s Development Facilitation Program.
“We’re making sure Victoria’s booming quarry sector can keep delivering the raw materials needed to build the projects we need – from affordable housing to new hospitals and renewable energy projects,” D’Ambrosio said.
Alcoa’s Portland aluminium smelter in Victoria. Image: Alcoa
Closing its acquisition of Alumina Limited in August will be a key metric for Alcoa as it looks to finish off the remaining half of 2024.
The Australian Foreign Investment board approved Aloca’s acquisition of Alumina Limited (ASX: AWC) on June 13. The major is expecting the transaction to be completed on August 1, subject to shareholder approval.
Other highlights from the quarter included a net income of $5–$25 million, an increase driver by the non-recurrence of a charge of $197 million recorded in the first quarter of the year.
Alcoa’s cash balance is expected to approximately $1.4 billion at June 30, a number consistent with the prior quarter.
While Alcoa experienced a five per cent decrease in alumina production and shipments, Alcoa president and chief executive officer William Oplinger is remaining optimistic.
“We had strong preliminary results for the second quarter of 2024 which reflect market improvements,” Oplinger said. “We are looking forward to closing the acquisition of Alumina Limited on or about August 1, 2024.”
Revenue is also expected to increase for the second quarter, ranging from $2.8–$2.9 million. Alcoa is attributing this increase to higher average realised third-party prices for alumina and aluminium.
The increases follow Alcoa’s strong first quarter results, when the company produced 542,000 tonnes of aluminium, in line with its strong results from the fourth quarter of 2023.
“In the first quarter of 2024, we finalised the terms of our acquisition of Alumina Limited, which will bring strategic, operational, and financial flexibility,” Oplinger said at the time.
“Raw material prices and markets are improving, and we are implementing near-term improvements to further strengthen Alcoa for the future.”
Subscribe to Australian Mining and receive the latest news on product announcements, industry developments, commodities and more.
The Mount Keith operation is part of BHP’s Nickel West business. Image: BHP.
BHP has decided to temporarily suspend its Nickel West operations and the West Musgrave project in Western Australia amid the global nickel downturn.
What does the suspension mean for the Australian nickel industry? Australian Mining investigates.
Operations will be suspended in October and handover activities for the temporary suspension will be completed by December.
The transition period has commenced and will see BHP suspend mining and processing operations at the Kwinana nickel refinery, Kalgoorlie nickel smelter and Mount Keith and Leinster operations, as well as suspend development of the West Musgrave project.
The company will also implement a care and maintenance program of work to ensure the ongoing safety and integrity of its mines and related infrastructure. BHP will also continue investing in exploration to extend the resource life of Western Australia Nickel to preserve optionality.
“We understand this is a challenging period for the Western Australia Nickel team and surrounding communities,” BHP president Australia Geraldine Slattery said.
“Since BHP announced a review of Western Australia Nickel in February, we have explored options to stem losses in the short-term and identify a viable path forward for the business.
“Like others in the Australian nickel sector, we have not been able to overcome the substantial economic challenges driven by a global oversupply of nickel. We have made the difficult but necessary decision to temporarily suspend the Nickel West operation and West Musgrave project.”
As a result, 1600 Western Australian Nickel frontline employees will be redeployed or offered redundancies.
BHP has pledged to support its workforce and local communities during the suspension. The company will establish a $20 million community fund to support local communities and will invest around $450 million per annum once the transition period to support a potential restart of Western Australia Nickel is completed.
“Western Australia remains an important investment destination for BHP globally, with investment in the state expected to be greater than $12 billion over the next five years and we will continue to work with all of our Western Australian partners to advance the economic prosperity of the state,” Slattery said.
BHP intends to review the decision to temporarily suspend its Western Australia Nickel business by February 2027.
The Nichel West operations suspension follows BHP pausing part of its Kambalda processing operations, which took effect from June. At the time, the major miner was also weighing putting its Nickel West operations into care and maintenance.
The review resulted in BHP making about a quarter of its West Musgrave workforce redundant and decreasing the number of contractors who were working at its Kalgoorlie nickel smelter.
Government response
In January, Federal Resources Minister Madeleine King and WA Mines Minister David Michael met with nickel producers to discuss ways they could support the industry during the downturn.
Following the roundtable, King and Michael said they would work together to accelerate discussions on incentivising investment while urgently progressing discussions with State and Territory Governments on common user infrastructure for critical minerals.
A month later, King placed nickel on the critical minerals list, which outlines minerals that are essential to low-emission technology, the economy and national security, and whose supply chains are vulnerable to disruption.
Now, King has described BHP’s decision as a reflection on “the extreme volatility in global nickel markets”.
“Our immediate concern is for the workers and communities impacted,” King said.
“We welcome the commitments made by BHP to redeploy workers who wish to continue to work for the company and we welcome BHP’s undertaking to continue to invest in Nickel West throughout the temporary suspension to enable a re-start when global nickel markets stabilise and improve.
“We also welcome BHP’s commitments to continue to support local supply chains and pay royalties to First Nations communities through the temporary suspension and work with the WA Government to continue to support skills and resource investment in future projects.”
WA Premier Roger Cook echoed similar sentiments.
“This is a disappointing decision and our thoughts are with the thousands of workers and their families affected by the suspension,” Cook said.
“My government will do whatever it takes to support those workers and our regional communities through this difficult time.”
The WA Government previously announced a 50 per cent royalty relief program to kick in if the average price of nickel concentrate dips below $US20,000 per tonne. The rebate is repayable by companies in equal quarterly instalments over the following 24 months.
BHP will now allocate funding towards the WA Government’s proposed $200 million critical minerals advanced processing common user facility, which will be co-funded by the Commonwealth.
The company will also pursue an electricity smelting furnace in Kwinana with its project partners, making its refinery resources and expertise available for critical minerals research in partnership with Curtin University, and will donate $5 million to support apprenticeships under the WA Government’s group training organisation wage subsidy program.
Industry response
Following the nickel roundtable in late January, King and Michael committed to engaging in further discussions with the Chamber of Minerals and Energy WA about the future of the nickel industry and the role of royalties.
CME CEO Rebecca Tomkinson described BHP’s nickel suspension as “responsible”.
“This is a challenging time for our critical minerals sector and we’re committed to working closely with State and Federal Governments to ensure our policy settings remain competitive, enabling the industry’s viability across all time horizons – short, medium and longer-term,” Tomkinson said.
“BHP is a significant employer in WA with strong ties to the local communities of Leinster, Leonora, Kalgoorlie and Kambalda. I know this decision comes after months of operational review and careful consideration of options. It has not been made lightly.
“We are fortunate right now that the WA minerals sector remains vibrant, so workers impacted by this decision are in a good position to secure work elsewhere in resources.”
Tomkinson said the industry cannot become complacent during difficult times.
“We must continue to keep WA mining strong by having a robust and efficient legislative framework in place that fosters future development,” she said.
Possible solutions
BHP has welcomed the proposed production tax credit (PTC) for critical minerals, which will allow eligible entities to claim 10 per cent of expenditure for processing and refining any of Australia’s 31 critical minerals.
The PTC was inspired by a similar US Government scheme introduced through the Inflation Reduction Act, which considered to be the largest climate investment in US history.
The Association of Mining and Exploration Companies (AMEC) engaged Mandala Partners in 2023 to economically model the introduction of an IRA-style PTC into Australia.
In February, AMEC led a delegation of mining and energy companies that included IGO, Wyloo, Australian Vanadium, QEM, Pilbara Minerals, and Tesla to progress discussions surrounding PTC with the Federal Government. Consultation on a potential PTC commenced in June.
Alongside a PTC, Wyloo CEO Luca Giacovazzi has advocated for a ‘green nickel price premium’, which would differentiate between the Australian-produced nickel that follows strong environmental, social and governance (ESG) standards and the low-quality nickel produced in countries such as Indonesia.
Nickel pricing reform also has the support of Minister King and Andrew Forrest.
In January, Henry predicted that the nickel downturn would extend to the end of the decade, adding that nickel is BHP’s smallest business.
“Yes, it’s been one of the three areas of production growth that we’ve called out for BHP … but having said that, it’s always been the smallest … business within the BHP portfolio, and in terms of the growth outlook for the company,” Henry said.
“But there’s 17 million Australians who depend upon BHP, either directly as shareholders, or indirectly through superannuation funds, for a successful and high-performing BHP.
“That creates a real sense of accountability on our part, to ensure that we’re taking the right decision, taking into account a range of considerations, both shareholder and other stakeholders, and we’re in that process as we speak.”
Subscribe to Australian Mining and receive the latest news on product announcements, industry developments, commodities and more.
MinRes’ transhipper delivering Onslow Iron’s first ore to bulk carrier off the Pilbara coast. Image: MinRes
Mineral Resources (MinRes) has signed an Indigenous land use agreement with Buurabalayji Thalanyji Aboriginal Corporation (BTAC) for the Onslow Iron project in Western Australia.
BTAC is the prescribed body corporate for the Thalanyji People that hold native title over 11,120 square kilometres of land in the west Pilbara, where Onslow Iron is located.
Under the Indigenous land use agreement, MinRes and BTAC will collaborate for the next 30-plus years to create opportunities for the Thalanyji People.
This includes creating employment opportunities for future generations of Thalanyji People, including apprenticeships and traineeships every year at Onslow Iron.
The signage of the agreement follows more than two years of collaboration between MinRes and BTAC.
“This agreement is the start of a positive relationship between the Thalanyji People and MinRes,” BTAC chair Frances Hayes said.
“This agreement will help the Thalanyji community through employment, training and business opportunities with hopes of making Thalanyji People prosperous for decades to come.
“I want to thank MinRes for working alongside BTAC throughout the co-design process to support the vision of a bright future that we have for our people and their children.”
BTAC conducted cultural heritage surveys prior to the construction of Onslow Iron’s dedicated haul road that links the Ken’s Bore mine site to the Port of Ashburton. It will now continue providing monitoring services to ensure cultural heritage protection.
“I am grateful to the Thalanyji people for entrusting MinRes with the responsibility of implementing this agreement,” MinRes managing director Chris Ellison said. “I am excited by the future successes we will share at Onslow Iron.
“As the first agreement of its kind signed by MinRes, this is a proud moment for the company and signifies our ongoing commitment to partner with Traditional Owners on whose land we operate.”
Onslow Iron is one of the largest iron ore projects currently being developed in Australia, with a forecasted annual capacity of 35 million tonnes and a mine life of more than 30 years.
The project is being developed by MinRes and its Red Hill Iron joint venture (RHIJV) partners China Baowu Steel Group, AMCI and POSCO. MinRes designed, constructed and operates Onslow Iron, with the project delivering its first iron ore shipment in May.
Subscribe to Australian Mining and receive the latest news on product announcements, industry developments, commodities and more.
The Tomingley gold operation in New South Wales continues to be a boon for Alkane Resources, meeting its updated production guidance of 55–58,000 ounces (oz).
Tomingley produced 57,217oz of gold for the 12 months to June 30, with production anticipated to be between 70–80,000oz for the 2024–25 financial year.
“Tomingley is steadily increasing production from the Roswell underground,” Alkane managing director Nic Earner said. “Tomingley is now performing well, and the paste plant and flotation circuit upgrades remain on schedule.
“Alkane’s board and management acknowledge and thank the employees and contractors of the company for their strong and continued commitment to safety, production and exploration performance.”
Alkane announced back in June that it was looking to expand key infrastructure at Tomingley, increasing its production to above 100,000oz of gold per year while also expanding the site’s plant to a nominal 1.5 million tonnes per annum.
“The underground at Roswell has begun production, and we expect to produce over 70,000 ounces of gold next year,” Earner said at the time.
“The paste plant and the flotation/regrind circuit are under construction with commissioning expected later this year.”
Tomingley’s five-year plan also involves the relocation of the Newell Highway, a project expected to cost Alkane $89 million in capital expenditure. A final investment decision is expected to be made in early 2025.
Subscribe to Australian Mining and receive the latest news on product announcements, industry developments, commodities and more.
Shine is located near Fenix’s Iron Ridge operation in Western Australia. Image: Fenix Resources
Fenix Resources is taking steps to recommence mining at the Shine iron ore mine in Western Australia.
The miner took the reins of Shine as part of its acquisition of Mount Gibson Iron’s Mid-West iron ore, port and rail assets last year.
The Fenix board announced today it has approved the restart and is aiming to commence site works in the current quarter with first iron ore production targeted for the end of the year.
Fenix executive chair John Welborn said Shine is an attractive ‘shovel ready’ growth project with similar mining scale and operational characteristics to the company’s nearby operations at Iron Ridge.
“The restart of mining operations at Shine is an obvious opportunity to expand Fenix’s production and leverage our excellent Mid-West mining and transport logistics capabilities,” Welborn said.
“Shine will be our second wholly owned producing asset in the Mid-West and is planned to nearly double our annual production levels in the near-term, which will result in increased revenues, stronger cashflows, and profitability growth.
“Fenix is committed to unlocking value from the abundant valuable resources of the Mid-West and the obvious place to start is with the resources that we own and control.”
Fenix said approval to proceed with the Stage 1 mine plan for Shine follows a comprehensive review of all aspects of the project.
This included the completion of an in-pit drilling program, product sampling, a tender process for mining and processing operations, and updated resource modelling.
Pre-production capital expenditure is expected to be minimal given the availability of all required critical infrastructure and that all required approvals and permits are in place.
The approved capital expenditure budget for Stage 1 is $7.4 million and includes the upgrade of existing camp infrastructure, contractor mobilisation, and the upgrade of the Shine access road.
Australian Vanadium Limited (AVL) has locked in key mining areas and a location for its downstream processing plant as the company moves closer to production.
AVL has finished the first phase of an optimised feasibility study (OFS), which was launched following the completion of AVL’s merger with Technology Metals Australia (TMT).
The study aimed to consolidate the companies’ adjoining projects into one orebody.
The Australian Vanadium project includes a vanadium mine and a crushing, milling and beneficiation plant located at Gabanintha near Meekatharra in WA, where the mining and upstream processing of vanadium bearing magnetite ore is proposed to be undertaken.
The next phase of the study will focus on finalising a detailed mining plan and optimisation of the plant and infrastructure.
“By focusing on the most promising sections of the orebody and conducting a comprehensive analysis to select the optimal location for the downstream processing plant, we have now finalised the key foundations from which the remaining OFS activities can fully define a ‘stronger for longer’ version of the project which has been unlocked through the recent merger,” AVL chief executive officer Graham Arvidson said.
In parallel to ongoing OFS works, Arvidson said AVL continues to assess opportunities for grant funding provided by the Australian Government.
The funds provide AVL options for activities such as detailed engineering and the acceleration of project schedule by proceeding with long lead equipment orders.
“Timely delivery of the project is a key objective for the company in anticipation of growing demand for vanadium flow batteries, which will cornerstone the essential long duration energy requirements of the net-zero carbon energy transition,” Arvidson said.
Subscribe to Australian Mining and receive the latest news on product announcements, industry developments, commodities and more.
