Rio Tinto will work with Caterpillar and Komatsu to expand its fleet of autonomous haul trucks in the Pilbara by more than 50 per cent by 2019.
The mining group, which has launched the projects as part of its $5 billion productivity program, plans to retrofit 29 Komatsu haul trucks at the Brockman 4 operation with Autonomous Haulage System (AHS) technology, starting next year.
Brockman 4 will be run entirely in AHS mode once this project has been completed by 2019.
Rio will also retrofit 19 793F trucks with Caterpillar at the Marandoo iron ore mine. The equipment manufacturer will install Cat Command for Hauling software for operation of the fleet as part of the project. It is expected the first few trucks at Marandoo will be retrofitted in mid 2018.
Chris Salisbury, CEO – Iron Ore, Rio Tinto, said the company was excited about starting this new chapter in its automation story with Caterpillar and Komatsu.
“Rapid advances in technology are continuing to revolutionise the way large-scale mining is undertaken across the globe,” he said. “The expansion of our autonomous fleet via retrofitting helps to improve safety, unlocks significant productivity gains, and continues to cement Rio Tinto as an industry leader in automation and innovation.
“We are studying future additions to our autonomous fleet in the Pilbara, based on value, to help deliver our share of $5 billion of additional free cash flow for the company by 2021.
“Rio Tinto is committed to working closely with our workforce as we transition to AHS including providing opportunities for new roles, redeployment, retraining and upskilling.”
Transporting iron ore across the Pilbara via skyrail has been approved by the Environmental Protection Authority (EPA).
The Bulk Ore Transportation System, or BOTS, will transport iron ore from the Iron Valley Project to Port Headland.
Designed to replace road trains, the skyrail will be mounted onto concrete beams, which in turn are spanned between precast concrete substructures. The carts/wagons will be powered by diesel and petrol.
All aspects of the project, including supporting infrastructure, will be monitored from a Perth-based control centre.
Four environmental factors were taken into consideration when the approval was given including flora and vegetation and terrestrial fauna. Also, there will be a decrease in the use of road trains, which is claimed to have a positive affect on the environment.
A worker has died on Tuesday morning after he was injured trying to secure cargo aboard a ship off the Pilbara coast.
39 year-old Newcastle resident Andrew Kelly was caught between a mini-container and a cargo skip after a wave crashed over the back deck of the Skandi Pacific at approximately 5:30am AWST.
Kelly was taken to a nearby drilling platform for medical assistance, but died of his injuries.
He was survived by his wife and four children, all under the age of 10.
A spokeswoman for the Australian Maritime Safety Authority (AMSA) said AMSA investigators would inspect the vessel in Dampier.
"AMSA surveyors were expected to visit the vessel this morning which is now in Dampier,” she said.
The company which operates the vessel, Norwegian company DOF Group, said the safety of staff and their families was a priority.
"We are doing everything we can to support the families and other crew members," the company said.
"The Skandi Pacific will be met by DOF representatives and a team of professional counsellors will be on hand to offer support and care for the crew onboard."
MUA national secretary Paddy Crumlin said the union would work with the regulator to ensure the cause of Mr Kelly's death was fully identified and rectified.
"The offshore industry is an inherently high safety risk environment, the highest in the country and the world, due to the isolated and unstable nature of seagoing work and the 24/7 requirements placed on seafarers," he said.
"The MUA is a relentless and unapologetic advocate for appropriate national safety and welfare programs, including equal time rosters and Employee Assistance Programs."
The Australian maritime Safety Authority will investigate an incident which injured two men at the Roy Hill Port construction project yesterday.
The incident occurred on the Netherlands ship Happy Buccaneer, which left one man in a serious condition with a crushed foot, and the other with a broken leg.
The ship was moored at Stanley Port at the Roy Hill South West Wharf.
The Pilbara Port Authority said the accident did not affect port operations.
A spokeswoman for Roy Hill said the company responded immediately to the emergency.
“Roy Hill is a major operator in Port Hedland and has a highly capable emergency response and medical team based in Port Hedland,” she said.
“We received a request for assistance and our team immediately responded to the incident, providing medical treatment to the injured people before they were transported to Port Hedland hospital for treatment.
“Our thoughts are with the injured people, their families and work colleagues.”
The Maritime Union of Australia said the ship was foreign crewed.
GE is taking Caterpillar on in the race to develop
locomotives that comply with stricter emissions standards.
These locomotives are typically used for the heavy and long
distance haulage seen right across the mining industry.
It comes as the US tightens its emission standards, and sets
a compliance deadline for next year.
According to The Wall Street Journal, GE is already testing
its locomotives that comply with the new standards whilst Cat’s compliant
freight locomotives are unlikely to be available until 2017.
GE has reportedly designed its latest locomotive with an
emissions reduction system and expects to begin full scale production of the
machines mid next year.
“We’ve got units operating so we can demonstrate
performance,” Tina Donikowski, GE’s locomotive vice president, told WSJ.
The move is likely to be a blow for Cat, particularly as GE
already holds more than two thirds of the US market, while Cat’s ElectroMotive
sees only around 30 per cent of its sales come from overseas, although this
figure does equate to US$2.5 billion.
According to GE it currently has 173 locomotives running across 1500 kilometres of rail network in the PIlbara, with each train itself approximately 2.4 kilometres long and consisting of 236 wagons that carry all up 26 000 tonnes of ore.
BHP Billiton has celebrated a significant milestone after shipping its one billionth tonne of iron ore to Japan.
BHP iron ore boss Jimmy Wilson was joined by joint venture participants ITOCHU Corporation (ITOCHU) and Mitsui & Co., Ltd (Mitsui) to mark the milestone in front of the Saiko bound for Japan.
Speaking at the event in Port Hedland on Wednesday, Wilson said Japan was a driving force behind the development of iron ore mining in the Pilbara.
BHP shipped its first tonne of the steelmaking ingredient to Japan nearly half a century ago in 1966.
“We also owe much to Japan for their role in growing the iron ore industry in the Pilbara. Our joint venture participants ITOCHU and Mitsui contributed capital, and as trading companies they were a key link into Japanese markets," Wilson said.
“Over the past decade, we have invested US$24 billion in Western Australia’s mines, rail and port infrastructure and continue to adopt new technology to ensure our operations remain world-class."
BHP Billiton President HSE, Marketing and Technology Mike Henry said that the ore exported to Japan came back to Australia as high-quality manufactured products like motor vehicles and the rolling stock and rail equipment used within the mining industry.
“Today the high-quality iron ore we export from the Pilbara is an essential ingredient for Japan’s high-tech steel industry which leads the world in technology and efficiency,” Henry said.
Last year BHP agreed to sell 15 per cent of its stake in the Jimblebar iron ore mine to ITOCHU and Mitsui for $US1.5 billion.
The deal was aimed at aligning Itochu and Mitsui’s interests across BHP’s Pilbara iron ore operations so assets could be operated in a straightforward and flexible way.
As part of the deal, the Japanese firms will receive an annual output of over 5 million tonnes, plusshares of future production increases.
The $US3.6 billion project delivered first production in the quarter ending September 2013 and is expected to deliver phase one capacity of 35 million tonnes per annum (Mtpa) per year by the end of the 2015 financial year.
This will increase BHP’s Pilbara supply chain capacity to more than 220 Mtpa.
A low cost option to expand Jimblebar to 55 Mtpa in the longer term would increase this to approximately 260 Mtpa to 270 Mtpa.
Wilson said as the company enters its next phase of growth, improving productivity, optimising capacity and working assets harder would deliver greater benefits to BHP customers.
“The good relationships we have between customers, employees, Indigenous land owners, ITOCHU and Mitsui have been and continue to be crucial to the success of the Western Australian business,” Wilson said.
Fortescue has signed a contract to construct four new ‘very large ore carriers’ (VLOC).
The contract, with an unnamed Chinese shipyard for the vessels, is valued at approximately US$ 275 million and will see the four ships delivered from November 2016 through to May 2017.
The majority of payments will be made upon delivery and funded from existing cashflows.
The 260 000 dwt (dead weight tonnage) class vessels, which will account four around six per cent of Fortescue’s shipping requirements by themselves, are larger than traditional capesize vessels and more suited to Port Hedland’s tidal conditions, according to the miner.
Fortescue CEO Nev Power said this new contract represents a strategic decision to secure long term, low cost freight on vessels that more closely complement infrastructure at the Herb Elliot port.
“These vessels are a natural extension of our supply chain and will play a significant role in increasing efficiencies at the Port and lowering costs,” Power said.
“They also reflect and strengthen our close relationship with China, our largest customer.”
The miner played a major part in the development of the VLOC to ensure the design complemented Port Hedland’s tidal conditions and its shallow nature.
This latest development comes on the back of record outputs at Port Hedland.
The Pilbara has had a remarkable boom in recent years, but with the current slowdown comes questions about its long-term future. The need to diversify the local economy is obvious, but how do you do this? In our report, Pilbara 2050 we have explored how networked infrastructure could help in this transition.
The Pilbara’s energy generation, transmission and rail systems are operated separately by mining, petroleum and energy companies on a combination of gas and diesel with very little grid present. The result is high costs and carbon emissions. Connecting the existing power infrastructure into a grid would not only make a more resilient system, but it would enable electrifying of the railroads and mining pits which would reduce everybody’s operating costs and massively reduce carbon emissions.
Agriculture is emerging as a viable alternative to the region’s mineral resources, now that much more water has been found. But the fundamental question remains: where will power come from and how will bulk goods be transported? Renewable energy has a big future in the Pilbara as the area has the highest concentration of solar radiation on earth. Diesel could be replaced with renewable energy at a much lower cost. It would also create the pre-conditions for other more energy intensive industries to establish themselves. Without it, they will likely choose other regions to set up shop.
Attracting new businesses requires a lower cost base
A study by Regional Development Australia found the cost of doing business in the Pilbara is 40% more expensive than Perth and even higher when compared against other parts of Australia. Much of this cost is due to a premium placed on the price per kilowatt hour of electricity from more expensive inputs. It would seem sensible to try and find mutually beneficial solutions like the completion of power grids and shared rail systems to lower the costs of operating in the region.
These ideas are not new, but historically mining and petroleum companies prefer to just look after their own power and rail systems. This week, former Western Australian Labor MP Larry Graham said “private companies that built and own the railways will not, and should not, put their vital lifelines under someone else’s control”.
This raises important philosophical questions: do governments have the requisite capabilities to manage the infrastructure issue? And to what extent is competition affected by creating integrated networks?
For answers, we have looked at other international locations that have faced a similar predicament and either through government intervention or market-based decision making, have worked to link common networks to the benefit of all.
The Central Electricity Board was established in 1926 in the UK to standardise the nation’s electricity supply. Until then, the industry consisted of more than 600 electricity supply companies and different areas operated at different voltages and frequencies. The Board established the UK’s first synchronised AC grid, which by 1933 covered most of England. In 1938, this started operating as a national system called the National Grid. The Board was dismantled when the grid was nationalised in 1947.
In the airline industry, a codeshare agreement is an arrangement where two or more airlines which compete for the same markets, form a strategic alliance to share the same network routes. A ticket can be purchased from either carrier, but the flight itself is actually operated and managed by only one of the participating airlines. Under such agreements, costs are shared between the carriers who might otherwise struggle to make the flight route economically viable on their own.
Private and government integrated
The London Underground opened in 1863 and was the world’s first networked train passenger system. It was originally built by private enterprise but nationalised in 1948 and since then has been run under a combination of private and public partnerships.
In the UK, various aspects of the mobile networks are shared, including with the government. In Australia, for example Optus and Vodafone share mobile towers and network coverage to provide better services at a lower cost to customers. Since 1991, cash ATMs are another example of privately shared networks.
Shared value approach
In Canada, the oil sands industry has historically operated with separate parallel entities, ignoring the cumulative environmental impacts of their activities, resisting further environmental legislation and the need to talk to one another. But an approach called Shared Value developed by Harvard professors Mark Kramer and Michael Porter, resulted in Canada’s Oil Sands Innovation Alliance being established, in which major companies have shared more than 560 technologies worth a total of US$900 million.
Getting the public/private balance right
The argument that private companies would – and should not – cede control over access to critical infrastructure is not borne out in these case studies. Despite often cited business concerns around the loss of control and risks to business continuity, evidence suggests that in fact integrated public planning can be extremely cost effective and everybody is a winner.
There can be big benefits for all when you get a proper network going. In the Pilbara, the private sector hasn’t been good at that. Until now, there has been a reluctance to push ahead with utilising the existing electricity transmission infrastructure to create an interconnected grid. The outcome of legal attempts for greater rail sharing has often seen the requirement for sharing lessened.
Graham also argues that governments have an “inability to operate effectively”. The Pilbara Development Commission and Pilbara Cities has shown government has plugged a great deal of the infrastructure deficit in the Pilbara created from the commodities boom.
At the heart of this debate is whether the private or public sector can deliver best. Governments and business can and do work together well. The biggest functioning networks are always built by an integrated state.
With the right philosophical basis, West Australian problems could be addressed holistically. In the Pilbara, without the creation of mutual networks and benefits of scale, the economic diversification prize will remain illusive.
Jemma Green has received funding from The Dampier Port Authority.
Peter Newman and Jemma Green received funding from Dampier Port Authority for the Pilbara 2050 Report
A council in Western Australia’s Pilbara region has expressed concern over Rio Tinto’s plan to build a railway line near the asbestos-ridden ghost town of Wittenoom.
As part of Rio’s proposed Koodaideri iron ore mine, the company have submitted documents for a 167 km railway line to be built which would connect to the company’s Dampier-Tom Price line.
While the track would avoid the former town, Rio plan to construct part of the track through the wider Wittenoom asbestos management areas, The West Australian reported.
The Shire of Ashburton is concerned workers could be at risk to exposure, calling for indemnity from litigation if the track goes ahead.
According to documents filed by Rio, the $3.5 billion project is expected to produce 35 million tonnes of ore a year, before a ramp up by 2030 which will see that figure increase to 70 million tonnes a year
New roads, power sources, water infrastructure and FIFO village facilities would also be need to be constructed.
The Environment Protection Authority is currently assessing the project before making a recommendation to the Minister for Environment Albert Jacob.
If Rio choose to pursue the project construction is expected to begin in the second half of 2014 before first production in 2016.
Pay deals between BHP and its rail drivers have recommenced after the miner failed to meet union demands of pay rises, cheap rent in the Pilbara and extra annual leave.
The CFMEU said BHP’s three-year pay offer was rejected by about 60 per cent of 350 rail drivers in April this year.
Pay negotiations with BHP Billiton started last year, representing the continuing strengthening of CFMEU presence in the Pilbara.
The union negotiations are the first major talks with BHP in the Pilbara for more than a decade.
Wood told Australian Mining negotiations were set to recommence in the coming weeks.
Wood said the offer was rejected because the company did not meet a key demand for guaranteed annual pay rises of “ideally between 4 or 5 per cent.”
Wood also said workers were distrustful of BHP Billiton's offer for performance-based annual increases, adding that the miner failed to meet other key demands including for FIFO workers to be awarded an extra four hours of annual leave per swing to compensate for travel time to and from site.
This has the potential of adding an extra week or two to annual leave per year, depending on each employee‘s roster, The West Australian reported.
Wood said that the drivers should be able recoup time when travelling to and from site during their R&R leave.
The third key demand was for 50 Port Hedland-based train drivers to gain access to BHP-owned housing.
In return, the staff would give up an existing $1800 weekly allowance for offsite accommodation.
Wood said rental homes cost more than $2000 a week in Port Hedland and with workers fearing rents could increase further.