Sie sind auf Seite 1von 163

From copper

to innovation
Mining technology roadmap 2035

Coordinated by Fundación Chile


01
Fotografía Minera Centinela
COPPER’S
ROLE IN THE
CHILEAN
ECONOMY
01 COPPER’S ROLE IN THE CHILEAN ECONOMY

Copper has been


The national impact of copper production has
Copper production
1
increased considerably over the last two decades, in (MT) increased
influencing the design of public policies and the by 3.5 times
country’s macroeconomic stability. When this is between 1990

fundamental to
taken into account, certain fundamental questions and 2015. It will
be hard to expand
arise: Will copper continue being the engine of current production
the Chilean economy? How long can it continue by over 40% in the
playing that role? Does the leap to development next 25 years

economic growth in
depend on this mineral?

Copper currently plays a more prominent role than


ever before in history. Chile is closer to becoming

Chile and has emerged


a developed country, but the expansive experience
with copper production that was registered over
the last 20 years will not be repeated1 (see Box 1).
In addition, the boom in commodity prices came to

as fundamental to
an end in 2015.

making the leap


to development
The Fundación Chile team
was in charge of drafting this
section, coordinated by Patricio
Meller and including: Francisco
Klima, Tomás González, Hernán
Araneda and Nicole Valdebenito

alta ley Mining technology roadmap 2035 / 5


01 COPPER’S ROLE IN THE CHILEAN ECONOMY

box 1: EVOLUTION OF NATIONAL


COPPER PRODUCTION
GRAPH/1 GRAPH/2
Chilean copper production Chilean copper production
1950-2014 (Thousands of MT) No.1 1950-2014 (Thousands of MT) No. 2
The below graph illustrates how copper production The graph shows the pace at which copper production
in Chile has evolved over two major periods. The evolved. Production increased by close to 500,000
first, illustrated by the dotted line at 827,000 MT, MT between 1950 and 1974 and in 1996 it increased
represents average annual production between by 627,000 MT in a year. In the next decade, annual
1950 and 1990. The second, illustrated by the growth volumes were very high, with as much as
blue line at 4.4 million MT, represents average 704,000 MT in 1999. Over the last decade, the increase
annual production between 1991 and 2014. over 2004 production has been just 337,000 MT.

6.000 6.000

5.000 5.000
Chilean Production
Thousands of MT

Thousands of MT
4.000 4.000 24 years,+ 539,000 MT
2 years, +499,000 MT
3.000 3.000 6 years, +532,000 TM
3 years,+ 556,000 MT
2.000 2.000 1 years, +627,000 MT
Chilean Production 2 years, +571,000 MT
1.000 1.000 1 years, +704,000 MT
Average 1950-1990 4 years, + 513,000 MT
0 0
1 years, + 508,000 MT
1950 1958 1966 1974 1982 1990 1998 2006 2014 Average 1991-2014 1950 1958 1966 1974 1982 1990 1998 2006 2014 10 years,+ 337,000 MT

Source: compiled by authors based on Cochilco data. Source: compiled by authors based on Cochilco data.

6 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 7
Copper represents 55% of the country’s
exports (and foreign currency generated) and
is the second most important source of fiscal
revenues. In addition, the importance of Chilean
copper on a global level and as a percentage of
exports has also risen significantly (see Box 3).

Chile’s share of copper production was 16% of


global production until 1990 (a similar or smaller
percentage prevailed throughout a good part of
the 20th century). In contrast, in the 21st century
Chilean copper has accounted for 30%. A similar
situation is the case with Chile’s proportional
share of global copper reserves (see Box 2).

The importance that Chile has acquired in world


copper mining means that one can no longer be as
passive in the 21st century as one could in the 20th.

Chile is small in every way but in copper. China


has the world’s largest population, 77 times that of
Chile’s, while Chinese GDP is 33 times that of Chile’s.
But Chile is 7 times bigger than China and bigger
than any other country when it comes to copper.

Today copper can play a critical role as a driver of


technological innovation. When a country represents
30% of a given commodity’s global production
Photograph: Codelco (El Teniente Smelter)

and also has a similar percentage of global


reserves, it is worth asking: Why is that country
not a world center for research, development
and technological innovation related to it?

We should consequently strengthen copper


mining as a platform to drive technological
innovation. This Technology Roadmap (TRM)
makes a series of proposals and identifies
specific challenges with this objective in mind.

alta ley Mining technology roadmap 2035 / 9


01 COPPER’S ROLE IN THE CHILEAN ECONOMY

box 2: CHILE’S
RELEVANCE IN THE
GLOBAL COPPER MARKET
GRAPH/3 GRAPH/4
2014
Chilean participation in Chilean share 1994
2004

global production of copper of global copper 2000


29,9%
reserves 28,4% 29,8%

25,9%
40%
35%
30% Source: compiled by authors based on data from the US Geological Service (USGS Mineral Commodity Summaries)

25%
Chile in Global
20% production FIGURE/1
15% Comparison between China
10%
Average 1950-1990
and Chile: Population, GDP
0%
and copper reserves
1950 1958 1966 1974 1982 1990 1998 2006 2014 Average 1991-2014
Population / Million people GDP / Million US$ Copper Reserves / % global
Source: compiled by authors based on Cochilco data. China 1.357 China 9.240 China 4%
Chile 17,6 Chile 227 Chile 30%

Source: compiled by authors based on data from the Word Bank and the US Geological Service (USGS)

10 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 11
01 COPPER’S ROLE IN THE CHILEAN ECONOMY

Copper has been fundamental to economic growth


in Chile and has emerged as something fundamental
to making the leap to development. Nevertheless, we
are faced with a “great paradox”: Chilean society does
not recognize this or does not know it, and a negative
opinion on mining can be detected (see Box 4).

The poor social evaluation of the mining industry,


especially copper, would appear to go beyond civil
society. As already noted, mining is the productive
sector that by far contributes the largest sum of
resources to the state. However, it is worth noting
that the Mining Ministry is one of the ministries
with the smallest budgets. The amount it receives
it is less than 10% of what the Agriculture
Ministry receives; why? What is the logic behind
this unequal allocation of resources? Can it be
that Chilean agriculture faces bigger and more
complex problems than mining does? Is agriculture
more important to Chilean development than
mining? This budget indicator synthesizes and
reflects Chilean society’s appreciation of copper
and the priority it assigns to it. Why is this? The
productive image of 19th-century Chile would
appear to prevail, when we are in the 21st century.

But there is something else: the role of ideas on


the pattern of national development. There is the
somewhat primitive notion that having copper
is a sort of “divine punishment” (see Box 5).
Photograph: Codelco (Copper cathodes)

12 / Mining technology roadmap 2035 Alta ley alta ley


01 COPPER’S ROLE IN THE CHILEAN ECONOMY

box 3: RELEVANCE OF COPPER


TO THE CHILEAN ECONOMY
GRaph/5 GRAPH/6
Value of copper exports Copper’s share in total Chilean
1960/2014 (Millions US$) exports of goods 1960 – 2014

The graph shows the change in the The green area shows the percentage
scale of copper exports after 2004, of total exports of Chilean goods that
with an annual average of US$33.518 corresponds to copper, which has
billion, significantly higher than the always been higher than 50% since
average of US$2.628 billion in the years 2006. Meanwhile, the gray line shows
preceeding this period. The secondary the percentage of mining exports
axis shows the evolution of copper in general, which has represented
prices on the London Metals Exchange. an additional 7%-10% over recent
years and peaked at 66% in 2007.

45.000 100%
40.000 90%
35.000 80%

Percentage
US$ Million

30.000 70%
25.000 60%
20.000 50%
Value of Cu Exports 40% % X_CU in X_ Totals
15.000 Ref. Cu price % X_Mining
30%
10.000 (nominal LME) in X_totals
(US¢/IB) 20%
5.000 Average 1960-1974
Average 1975-1990 10%
Average 1975-1990
0 Average 1991-2014 0% Average 1991-2014
1960 1966 1972 1978 1984 1990 1996 2002 2008 2014 1960 1966 1972 1978 1984 1990 1996 2002 2008 2014

Source: compiled by authors based on Cochilco data. Source: compiled by authors based on Cochilco data.

14 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 15
01 COPPER’S ROLE IN THE CHILEAN ECONOMY

GRAPH/7 35%
30%
Current Chilean copper production is close to
6 million metric tonnes (MT). Aging mines and
Copper’s share of fiscal 25%
declining ore grades mean that if important
revenues, 1995-2014 20%
15%
investments are not made, production will fall to 4
million MT in 2025. Given that Chile has 30% of global
10%
reserves the target has been set of maintaining its
5%
current 30% share of global copper production. This
0%
1995 1996 1999 2002 2005 2008 2011 2014 means raising production to 8 million MT by 2025.
Tremendous and varied technological challenges
will to be resolved to achieve this goal. The
Corporate Taxes GMP-10 Total Contribution
Contribution State Mining Companies
purpose of this TRM is to identify these challenges
for the copper mining industry through 2035.
Source: compiled by authors based on Cochilco data.

GRAPH/8 14.000
12.000
Evolution of copper’s
10.000
contribution to the 8.000
state 1995-2014 6.000
4.000
2.000

1995 1996 1999 2002 2005 2008 2011 2014

Corporate Taxes GMP-10 Total Contribution


Contribution State Mining Companies

Source: compiled by authors based on Cochilco data.

16 / Mining technology roadmap 2035 alta ley


Alta alta ley Mining technology roadmap 2035 / 17
01 COPPER’S ROLE IN THE CHILEAN ECONOMY

box 4: WHY DOES CHILEAN


SOCIETY UNDERVALUE MINING?
CHILEAN SOCIETY’S PERCEPTION PROBLEMS WITH TRANSMISSION is found, drilled and blasted with dynamite The prevailing perception in the 1960s was
Chilean society has a complex about being OF INFORMATION / the rock is spilled, purified: copper is that foreign investment only generated Source: Meller,
a mining country. The collective imagination Diverse national institutions produce born./ Before that nobody will know how costs for Latin American countries. As P. (2013). La viga
perceives being a mining country as information on copper: Cochilco, Sonami, to differentiate it from the maternal rock. / can be noted, there was a 180-degree maestra y el
sueldo de Chile.
implying underdevelopment. Becoming Consejo Minero, Mining Ministry, Cesco, Now it is man.” There is no doubt that 21st shift after 1990, when the countries of UQBAR
a developed country is not a matter of Sernageomin, the departments of Mine century copper mining uses productive the region began to compete with each
achieving given a level of per capita income. Engineering and Mining Research Centers technologies that are vastly different other to attract the maximum flow of
at diverse universities, the institute of from those of 19th century coal mining. foreign investment, currently considered
A large part of the population is mine engineers, among others. In sum, vital to growth and globalization.
convinced that Chile will only be a information on mining abounds, but how THE WEIGHT OF HISTORY
developed country when it produces cars, much of that information are people familiar For a long period in the 20th century, MINING POLLUTES THE AIR AND WATER
planes, electronic products, satellites or with? Who is responsible for reducing the the US companies that owned Large The mining sector’s productive
when a company equivalent (in terms level of (mining) ignorance among public Scale Copper Mines (LCM) had a very processes produce diverse
of innovation and magnitude) to Google, opinion leaders and the general public? conflictive relationship with Chilean contaminants, including sulfur dioxide,
Apple or Microsoft is born here. Simply put, Chileans cannot see the copper governments. The agreements reached anhydrous sodium carbonate and
elephant sitting at the dining room table. underwent continual change over time. arsenic. The industry has made major
However, Chile is a country with comparative Chilean governments would pressure progress along these lines, but the
advantages in copper. Mining is the main CHILEAN LITERATURE for successive increases in the tax collective imagination continues to
economic sector: (i) it represented 30% Baldomero Lillo’s “Sub Terra” stories offer rates paid by LCM. US governments have the idea that the mining sector is
of total capital stock and 33% of foreign dramatic and disturbing visions of coal would implicitly or explicitly act to halt highly polluting of essential resources
investment flows in the period 1990-2014; mining: “The memory of his life, of those or counterbalance the tax pressures like the air and water. In addition,
(ii) taxes paid by the mining industry are 40 years of work and suffering, presented exerted by Chilean governments. The there has been a substantial increase
equivalent to the total taxes paid by almost itself suddenly in his imagination, and with levels of investment were another in greenhouse gas emissions as a
all other productive sectors together; great anguish he realized that the only source of conflict. Chilean governments direct or indirect consequence of the
(iii) average labor productivity in the thing left of that immense task was an would pressure US companies to productive process. Another aspect that
mining sector is equivalent to 4 times the exhausted body that might soon be kicked increase Chile’s share in global copper communities near mining operations
productivity of the financial sector and 6 out of the mine as a nuisance...and that a production. However, the environment are particularly sensitive to is the use
times that of industry; (iv) copper represents similar fate awaited his sons.” Nobel Prize was clearly unfavorable toward US of water resources available. This
the main source of savings in Chile’s winning poet Pablo Neruda wrote in his investment in post-Cuban revolution leads to a potential conflict between
Sovereign Funds, around US$20 billion. Yet “Ode to Copper:” “the mine is just the man/ Latin America. The conflicts reached human consumption and that of mining.
Chilean society tends to have a negative the ore does not come from the ground, it their height with the processes of Mining companies have begun to use
opinion of copper despite all this; why? comes from the human breast / the vein “Chilenizing” and nationalizing LCM. seawater to neutralize this situation.

18 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 19
01 COPPER’S ROLE IN THE CHILEAN ECONOMY

box 5: REFUTING THE ‘CURSE


OF NATURAL RESOURCES’
The conceptual framework of the ideas an asset or a source of wealth for Why would some countries seem to includes satellite communication, robotics,
that dominated in Latin America and countries. A source of wealth is wealth have a natural resources curse and nuclear sensors, computer modeling of Source: Meller,
Chile in the 20th century was against and there is no difference between others a blessing? That dual possibility is diverse processes, the use of a varied P. (2013). La viga
natural resources (NR) and raw materials. different types of assets or wealth. defined by the use that one gives to the range of software to make productive and maestra y el
sueldo de Chile.
The prevailing argument last century surpluses that NR produce. Countries that administrative processes more efficient, UQBAR
was that industry was a fundamental But the “Curse of Natural Resources” allocate a significant proportion of these remote control of diverse operations,
sector to become a developed country. hypothesis suggests than an underdeveloped surpluses to technological innovation etc. Briefly put, the (large-scale) mining
Thus, for Chile to become a modern country with copper or oil will show slower show higher levels of development than sector’s production methods are among
country it would need to industrialize economic growth than an underdeveloped those which privilege consumption. In the most sophisticated there are from
and to abandon its dependence on NR. country without those resources. Briefly colloquial terms, the difference is between the technological perspective, both on a
put, according to the “Curse” it would be “eating copper” and “planting copper.” national as well as international level. If
Two hypotheses sustained this argument: preferable not to have NR than to have them if all productive sectors used technology
(i) the Prebisch (CEPAL/ECLAC) thesis faster growth is what one wants. Is that true? In addition, there is scant and inconclusive with 50% of the intensity that of the
on “Deteriorating Terms of Exchange,” empirical evidence on “Deteriorating terms mining sector does, then Chile would
which holds that the relative price of If so, resolving the “Curse” would be simple. of Exchange.” The idea has been particularly currently be a developed country.
NR will decline with regard to industrial Chile could leave the copper in the ground, invalidated over recent decades: it is
goods. This would mean that more refrain from cutting the trees it plants, do enough to observe that the price of In reality, there is no obvious reason why
and more tonnes of copper would without the fish in the sea, not harvest the computers has shown a real annual decline large-scale copper production should
be needed to buy industrial products fruit from trees, etc. Would that really have of over 10% for 30 consecutive years: a inhibit the possibility of technologically
(cars, machinery, computers); (ii) the a positive impact on economic growth? tonne of copper today buys many more innovative companies coming to install
“Curse of Natural Resources” theory On the other hand, would abandoning all computers than it did in 1980. For example, themselves in the country. In other words,
(Sachs & Wagner, 1995) argues that of these activities spontaneously produce in 1980 it required 2 tonnes of copper o buy it would be irrational for Chile not to take
countries with relatively larger amounts a boom in technological innovation? The a computer; in 2000 one tonne of copper advantage of its comparative advantages.
of NR show lower levels of economic answer is, briefly put, that it would be could buy 2 computers. In 2015 a tonne of
growth than countries with few NR. irrational for Chile not to take advantage of copper is exchanged for 10 computers. Copper has been the engine of Chilean
its resources and comparative advantages. economic growth. But copper has to
It is counterintuitive to argue that because In addition, the mining sector is a true become a platform for technological
a country has significant NR it will tend The issue has now changed from the leader in the use of modern technologies innovation to continue being the
to be poorer in the long term. This is “existence of the Curse of Natural and IT (information technologies). The cornerstone of development. That
because possession of NR constitutes Resources” to the following question: use of advanced technologies in mining is the purpose of this TRM.

20 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 21
Photograph: Codelco (El Teniente Plant)
02 ROADMAP
LOGIC AND
METHODOLOGY
02 ROADMAP LOGIC AND METHODOLOGY

TECHNOLOGY ROADMAPS: INTERNATIONAL

The value of the


EXPERIENCES AND BEST PRACTICES
There is nothing new about technology roadmaps,
which originated as a technological planning
tool in Motorola in the 1970s as a way to align

Roadmap lies not just


product development with the necessary support
technologies and to determine the best ways to
approach future markets (Bernal et al., 2009),
(Industry Canada, 2007a), (Phaal & Probert, 2009),

in the results obtained,


(Willyard & McClees, 1987).

This practice, which subsequently spread to


other and more wide-reaching business areas,

but also in the process


represents an important source of support for
those responsible for innovation in companies,
allowing them to define and guide technological
development in advance.

of debate and reaching Roadmaps were adapted to fulfill different


purposes as their use expanded. The first
roadmap on a productive sector level was that

consensus with
of the International Semiconductors Industry in
1992: it was global, highly influential when it came
to defining the industry’s collective vision and
created a reference for technological innovation

stakeholders regarding
and development in the sector (Phaal & Probert,
2009); (Schaller, 2004).

Governments from different parts of the world

the common challenges


learned from these experiences and together
with other organizations started to promote the
drafting of road maps for the development of The following team from
their industries. This in turn was a reflection how Fundación Chile was in charge of

that the industry faces


innovation came to be understood as a systemic drafting this chapter: Francisco
phenomenon that occurs in an ecosystem where Klima, Tomás González,
actors face diverse problems related to collective Nicole Valdebenito, Hernán
action. One case that stands out as a roadmap Araneda and Patricio Meller.
success story is that of Canada, whose federal

Alta ley alta ley Mining technology roadmap 2035 / 25


02 ROADMAP LOGIC AND METHODOLOGY

government has explicitly acknowledged that · Allowing and facilitating interaction between that decide to base their work on this type of updating and deepening the contents of a
for its industries “to be innovative and globally the private and public sectors to detect existing instrument face numerous complications in doing roadmap require careful consideration of the
competitive, it is essential that industry players bottlenecks and opportunities affecting so, to which a series of problems involving collective tools and processes needed. International
collaborate on common technology issues” existing and future investment problems. action are added when dealing with a roadmap for experiences show that these reasons and the
(Industry Canada, 2007a). an entire productive sector. existence of problems with collective action
· Interaction between the public and private make it highly convenient for there to be an
Following this concept, Industry Canada sectors through a technology roadmap allows A critical point for the success of this tool is its articulator and facilitator of the process of
implemented an official and specific initiative on knowledge to be produced that helps to reduce implementation. The most important factors to drafting, implementing and updating a roadmap.
the matter, which has since 1995 developed over future uncertainty, though without eliminating it. facilitate the fulfillment of what is proposed are: for
20 roadmaps on industries as diverse as aluminum This is considering that the core characteristic companies to have a clear business need, for there to METHODOLOGIES AND STAGES FOR
transformation, wireless technology, plastics, of future events is their uncertainty. be a desire to develop effective business processes, THE CONSTRUCTION OF A ROADMAP
printing and graphic communication, textiles, for the right people to be involved, and for there to be FOR CHILEAN MINING
aerospace components, integration of aircraft cabin · Playing an important role in driving innovation a commitment on the part of top leadership. For their The value of the Technology Roadmap for Chilean
management systems and digital media. and inducing cooperative progress in part, factors that hinder compliance are: an initiative mining lies not just in the results obtained,
research and development activities. To this surfeit, distraction from short term goals and the but also in the process of debate and reaching
There are also experiences in other countries. end, the technology roadmap articulates lack of sufficient information or available knowledge consensus with among a significant group of
According to Phaal & Probert (2009), a study by the necessary elements for focalizing and (Phaal et al., 2001). stakeholders regarding the common challenges
Cambridge University’s Institute for Manufacturing prioritizing future technology needs. that the industry faces.
(IfM) identified over 900 examples of road maps Despite these difficulties, experts agree that,
that had been drafted for a wide variety of The essential premise of a technology roadmap is beyond implementation, the exercise of drafting Thus, the Technology Roadmap fulfills different
sectors throughout the world, including energy, that the future can be built, in contrast to a passive a roadmap is of itself highly valuable as it internal and external functions:
transportation, materials, aerospace, electronics, attitude in which the future simply happens. manages to bring together industry and public · It generates consensus on the future
IT, manufacturing, construction, health, defense Therefore, the initial stage consists in reaching a sector representatives to debate and jointly outlook for mining on an internal copper
and basic science. consensus on a vision for the future and specifying identify challenges and opportunities, forging sector level, identifying technological
the objectives and dilemmas of a given sector, in collaborative relationships based on dialogue problems and challenges.
The following are a few examples of how this this case mining, over a 10-20-year period. and understanding (Bernal et al., 2009), (Collins · On an external level it provides the information
tool has been used specifically in the mining & Pincock, 2010), (García & Bray, 1997), (Industry to stimulate collaborative research in the
sector: Taking South Africa Mining to 2030 Thus it helps to create a referential framework Canada, 2007a), (Phaal et al., 2001). academic sector, technology institutes and
through Resourceful Collaboration, Roadmap for coordinating R&D activities among companies among suppliers and consulting firms.
for European Mining Regions and the US series in the sector, suppliers and also the academic Likewise, to take full advantage of the benefits that
of technology roadmaps Mining Industry of the scientific community. This allows a more efficient drafting a roadmap brings, it is fundamental that a The Technology Roadmap (TRM) contained in this
Future, all documented in the reference section allocation of R&D resources. permanent work dynamic be generated around it document was constructed over four consecutive
of this document. so a roadmapping culture can be developed. phases: i) forging and validation of the vision;
It should be noted that an analysis of international ii) identification of technological challenges and
As we can see, a technology roadmap can experiences also reveals the difficulty of successfully Keeping a roadmap alive is an important prioritizing core challenges; iii) workshops for
fulfill diverse roles on a productive sector level, implementing everything that is contained in a challenge and the only way to obtain the full drafting the Technology Roadmap; iv) validation of
including: roadmap (Industry Canada, 2007a). Even companies benefits of the exercise. Communicating, the Technology Roadmap.

26 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 27
02 ROADMAP LOGIC AND METHODOLOGY

FIGURE/2 IDENTIFICATION OF TECHNOLOGICAL CHALLENGES


AND PRIORITIZING CORE WORK CHALLENGES
Stages for constructing As noted above. One of the factors that determine This was complemented by the identification
the Roadmap the success of a roadmap’s construction and of core enablers, which bring together
subsequent implementation has to do with the dimensions that, without being exclusive to
stakeholders’ willingness to undertake action on the mining process, condition the industry’s
the challenges identified. capacity to undertake its development plan.
They are: Human Capital, Adoption of New
The results obtained in previous experiences were Information and Communication Technologies
Identification of systematized to identify Technological Challenges. (Smart Mining), Suppliers and Innovation.
Forging and technological Workshops for Specifically, the Copper Technology Roadmap
validating challenges and drafting the Validation
the vision prioritizing core roadmap drafted by Amira (Australian Minerals Industry
challenges Association) in 2004 and 2006.

Subsequently, 50 interviews were held with


national mining industry leaders and experts, who GRAVITATING CORE CHALLENGES
Source: compiled by authors. validated or dismissed the challenges that had The term is used to refer to areas
already been identified, in addition to identifying at the heart of the mining process
other new ones. that present the most critical
technological challenges for the
The information obtained during the process was industry’s evolution. These are:
Each of these stages is detailed below. auspices of the National Council for Innovation analyzed and prioritized according to two criteria: Mine Operations and Planning, Ore
and Development (CNID) and after a process of Concentration, Hydrometallurgy,
FORGING AND VALIDATING THE VISION participative work with public and private sector · Impact: Resolving the challenges identified Tailings, and Smelting and Refining.
The initial stage before drafting a road map stakeholders developed the agenda “Mining: A had to have a significant impact on
consists in reaching a consensus on a vision for Platform of the Future for Chile,” a document attaining the proposed vision.
the future and specifying the objectives of the that defines a vision through 2035 and strategic CORE ENABLERS
industry over a 10-20-year period. This vision priorities for Chilean mining to consolidate its · Cross-cutting: The challenges must be common This term refers to the dimensions
of the future, one that is shared and generated aspirations, reaffirm its global leadership, create a problems that cut across the entire industry. that, without being exclusive to the
by all of the relevant stakeholders related to the virtuous cycle of innovation around it and become mining process, condition the industry’s
sector (mining companies, suppliers of inputs, a model of sustainability and inclusiveness. The Technological Challenges were subsequently capacity to undertake its development
consultants, academics, and agents and actors grouped together into gravitating core challenges. plan. They are: Human Capital,
related to the mining sector), allows the existing On 21 January 2015 the Alta Ley National The term “gravitating” was used to refer to areas Adoption of New Information and
challenges and the technological alternatives for Mining Program agreed that construction of a at the heart of the mining process that present Communication Technologies (Smart
achieving goals to be identified. Chilean Mining Roadmap would take place in the most critical technological challenges for the Mining), Suppliers and Innovation.
the framework of the vision established in said industry’s evolution. These are: Mine Operations
The “Chilean Mining and Development agenda, in particular aspects related to the and Planning,Ore Concentration, Hydrometallurgy,
Commission” was created in 2014 under the development of an innovative mining sector. Tailings, and Smelting and Refining.

28 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 29
Photograph Max Donoso (Atacama Iron Mine)
02 ROADMAP LOGIC AND METHODOLOGY

FIGURE/3 WORKSHOPS FOR DRAFTING THE ROADMAP


After concluding the previous stage, technical
Core issues in Roadmap workshops were held to draft a roadmap for
and Goals through 2035* each of the core issues that were identified. The
workshops followed the Cambridge University
methodology for formulating a Technology Plan
(T-Plan) (Phaal et al., 2001), (Phaal , Farrukh &
Probert, 2009), which consists in four sections:
Operations and planning mining

challenges, solutions, technologies and mapping.


Smelting and refining

This methodology fosters participation and


Concentration ores

Hydrometallurgy
cooperation among actors to reach consensuses
Tailings

GRAVITATING on solutions and to draft plans of action that allow


2035
CORE a sector’s common challenges to be addressed.
CHALLENGES Production of 8,5
millions of tons The workshops included the direct support of
an international consultant from Cambridge
80% of production University’s IfM (Institute for Manufacturing).
in first quartiles
in terms of cost In addition, skills were developed in a team of
for industry on consultants at Fundación Chile to facilitate and
global level synthesize the sessions, using complementary
methodologies for collecting information.
Human Capital 250 companies
World class suppliers
A technological baseline study was undertaken
CORE US$4 billion for each of the gravitating core challenges in
Suppliers and innovation
ENABLERS in exports of the Technology Roadmap in the context of the
goods and services challenges already identified in the previous stage.
Smart Mining With said information, the workshop participants
drafted the technological plan for each core
challenge, identifying challenges, solutions, R&D
lines and resources for their development.
“Targets defined in the context of the agenda Mining: A Platform for the Future for Chile.
Source: compiled by authors.
The number of sessions and duration of workshops
depended on the complexity of each core issue.
The figure below summarizes the work structure
for each of the gravitating core challenges.

32 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 33
02 ROADMAP LOGIC AND METHODOLOGY

FIGURE/4 The workshops convened representatives


Work structure of gravitating of mining firms, the public sector, academia,
technology centers, specialized suppliers, mining
core challenges sector consultants and experts from the areas that
correspond to each core challenge.

Core challenges Tailings Smelting


and Refining
Mine
Operations Ore
Concentration Hydrometallurgy FIGURE/ 5
and Planning
Summary of TRM
Construction Process

70 3 1
Technical Challenge
2 work 1 work 1 simultaneous Interviews with groups with Prioritization
No. of workshops sessions session work session
lasting half a
key actors experts Workshop
and duration lasting lasting
one day one day day for 3 core
challenges

+90 63 1.600
Actors Work
Workshop hours
participants Institutions involved
No. of technical
groups per 4 4 3
workshop

17 Challenges 58 Solutions 109 R&D Lines

Date(s) held 26.06.2015


03.07.2015 04.09.2015 22.10.2015

Mining Suppliers Trade Universities and State


Companies Associations R&D Centers Institutions
Source: compiled by authors.

Source: authors’ compilation

34 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 35
02 ROADMAP LOGIC AND METHODOLOGY

It should be noted that while the core enablers


were prioritized and validated by the Board of the
Alta Ley National Mining Program, no workshops
were held on them due to the nature and amount
of information available.

In addition, this document includes certain chap-


ters referring to the challenges that the Chilean
mining sector faces, which while not part of the
process to create a Technology Roadmap, are
nevertheless of central importance to the future
sustainability of the mining business. The contents
of these sections was drafted based on the public
information available and specific contributions by
experts and institutions.

ROADMAP VALIDATION
The results of each of the stages followed in the
construction of this Roadmap were validated by the
Board of the Alta Ley National Mining Program.

An extraordinary Board meeting was convened


and held in workshop format after the process had
concluded. On that occasion, the members of the
board validated and prioritized the challenges and
solutions that had been identified.

Photograph Technical Group, Tailings Core Challenge

36 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 37
02 ROADMAP LOGIC AND METHODOLOGY

THE CASE OF THE AMIRA COPPER aimed at fulfilling the objectives of are: (i) optimization of mine-to- 8. Preconditioning of rock to
2
Australian
TECHNOLOGY ROADMAP 2004 - 2006 the major industry players, and the Minerals Industry cathode operation; (ii) real time facilitate its fracture.
In 2003 the Australian Mineral Industries Roadmap contained in this document, Association. control of entire process; (iii) sharing 9. Improved sensor use (online)
Research Association, Amira2 and nine of which in addition to the above presents a information and knowledge. in flotation process.
the largest copper industry companies in national development strategy centered 10. Remote monitoring
the world decided to draft a technology on mining. · New technologies for mine of heap leaching.
roadmap to address the main challenges processes The R&D priorities related 11. Improved energy efficiency in
that they would face in the coming To appreciate the above, it is illustrative to this focal point are: (I) smart the movement of materials.
decade. The participating companies to review the Amira work mission, comminution (grinding); (ii) intelligent 12. Development of technologies for
included Codelco, Antofagasta Minerals, which commits it to “developing a ore extraction system; (iii) onsite the drying process (grinding).
Anglo American, BHP Billiton, CVRD, Rio framework around with global [copper] mining; (iv) technologies for the 13. Integrated optimization of
Tinto and Teck Cominco Phelps Dodge producers could collaborate to address implementation of “dry” processing. the mining business.
(subsequently acquired by Freeport- the common technological challenges
McMoRan). that they face in terms of the · Sustainable development. The Amira’s work concentrated on the pre-
industry’s future competitiveness and R&D priorities related to this competitive research and development
The Copper Technology Roadmap (Amira, sustainability. However, the objectives focal point are: (i) efficient use of possibilities, staking its bets on
2004) emerged from this effort. It was of this one are to: water; (ii) integrated sustainability complementing the internal efforts made
revised and adjusted to the specific model; (iii) mine closure design. in each company, in addition to offering
challenges of Chile and the rest of Latin · Cut production costs. them mechanisms for pursuing the most
America in 2006 (Amira, 2006). It should · Achieve an acceptable balance As a result of the aforementioned risky R&D exercises collaboratively.
be highlighted that, despite the fact that between the economic, focusing exercise, 13 projects were
the work was done precisely at the start environmental and social effects. chosen as R&D priorities: In a process that started with the
of the commodity price boom, the Amira · Manage technological and 1. Efficient copper ore blasting. definition of key business drivers
roadmap explicitly states that copper investment risks. 2. Continuous automation of and focus areas, continuing with the
mining was already facing serious · Improve the industry’s health, the mining process. identification of challenges and barriers,
challenges, which underscores the tool’s safety and hygiene. 3. Selective control of mine the priority technology research areas
usefulness in anticipating future risks. · Improve energy efficiency by material extraction. for copper extraction and processing
10% through the implementation 4. Analysis of mine processes were defined.
A review of Amira’s work (2004, 2006) of improved technology. to determine existing time
is presented below, as it is convenient savings opportunities. It is extremely important to keep in mind
and effective to examine that roadmap’s These five objectives were concentrated 5. Improved product recovery that technology advances at exponential
conclusions and suggestions to establish and specified in the following three focal and reduced energy use. rates in today’s world. While the Amira
the added value that this book offers. points: 6. Removal of undesirable materials Roadmap (2004, 2006) set a milestone
prior to the comminution for the time when it was published,
The first thing that should be noted is the · Improved efficiency in the used of and leaching processes. the possibilities that technology offers
different focus between Amira’s work, fixed capital and assets. The R&D 7. Improving water recovery now, a decade since the last time it was
which is a strictly technological roadmap priorities related to this focal point from tailings. updated, have expanded substantially.

38 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 39
02 ROADMAP LOGIC AND METHODOLOGY

This is why it is important for the 1. It highlights the role that copper · The use of renewable energies.
Chilean mining sector to frequently and has played in the Chilean economy · Carbon footprint mitigation strategies
systematically review the best ways to and how it has intensified over the · Strategies for having competitive
address the technological challenges it last two decades. In addition, it smelters and refineries in Chile.
faces, in addition to being aware of the highlights Chile’s preeminent role as · Evolution and competitiveness of
need to incorporate current social and a global copper producer in the 21st exploration activities in Chile.
environmental requirements. century (between 30% and 32% of
global production), double its relative Lastly, as international experts have
Notwithstanding the above and importance in the 20th century (16%). also acknowledged, another thing worth
differences in missions and the goals set, highlighting is the debate process that
the trends, barriers and, consequently, 2. It argues that Chile’s insertion in a has begun with the drafting of this
the research needs identified in the globalized world requires fostering Technology Roadmap. The process has
Amira report are consistent with those local innovation capacity and generating built up significant social capital in the
identified in this Roadmap and there is technological innovation. An explicit mining sector, which has helped to reach
an overlap in some of the technological premise of this TRM is that copper can a consensus on the future of Chilean
challenges that the mining continues and should be used as a platform to mining. There is currently agreement
to face. However, the issues that Amira drive innovation. Current and future on the goals that the main challenges
addressed (2004, 2006) represent a exploitation of copper mines entails revolve around. The companies
limited and specific subgroup of this major technological challenges involved in mining have discovered that
Roadmap. and resolving them can produce cooperation in the sector can help to
exportable expertise and innovations. resolve cross-cutting problems that
It is worth noting that Amira (2004, benefit all of the companies and society
2006) also highlights non-technological 3. It emphasizes the importance as a whole.
challenges for mining companies of strengthening the World Class
related to human capital, research Suppliers Program associated
and development capacities and with Large Scale Mining Firms.
infrastructure, and sovereign risk; This Program is a mechanism for
issues that remain relevant to this day driving and disseminating innovative
and constitute issues that could be capacity in diverse regions around the
instrumental to fostering cooperation country. Thus, when the copper runs
between the industry, academia and out it will have left us an important
government agencies. legacy: the capacity to innovate.

COMPONENTS OF THIS ROADMAP 4. It identifies a series of critical


AND DIFFERENCES WITH challenges that Amira (2004,
REGARD TO AMIRA’S WORK 2006) did not perceive:
The new components that have been · Tailings and their territorial impact,
included in this Roadmap are: especially in Chile’s central region.

40 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 41
Photograph Max Donoso (Spence, BHP Billiton)
03 MINING OF THE

THROUGH 2035
FUTURE: VISION
03 MINING OF THE FUTURE: VISION THROUGH 2035

STRATEGIC VISION THROUGH 2035

The mining industry is


AND MAIN IMPACT METRICS
The vision set out in the agenda “Mining: A
Platform of the Future for Chile” is for Chilean
mining to have achieved the following by 2035:

making the transition “Exporting between 130 and 150 million tonnes
of copper and other minerals in the 20 years
between 2015 and 2035, after materializing the

to a new stage and its


tremendous investment that this will require.
Eighty percent of this production will be ranked
in the first two cost quartiles for the industry
on a global level. In addition, 250 world-class

main challenges entail


suppliers will have been created, which will export
knowledge-intensive technologies and services
with sales that year worth a total of US$4 billion.

incorporating more
“Global leadership in sustainable mining will have
been established. This will be possible thanks to
environmental management that complies with
regulations and sectoral references based on

knowledge, innovation
industry best practice to rationalize demands and
permission processes, facilitating state oversight.

“Thus, demand for fresh water and energy will

and technological
have been reduced, as will greenhouse gas
emissions, in comparison with the projected
base year (BAU 2010) and no net losses in
biodiversity will be produced, thus contributing to

development
the conservation the country’s natural heritage.

“Forging ties of trust and cooperation among The following team from
all of the stakeholders involved in mining Fundación Chile was in
related activities. This will be made possible charge of drafting this section:
through ongoing, fluid, transparent dialogue Francisco Klima, Tomás
on equal conditions and crystallized in shared González, Nicole Valdebenito
benefit agreements that, when implemented, and Hernán Araneda.
will help to make progress toward the common

Alta ley alta ley Mining technology roadmap 2035 / 45


03 MINING OF THE FUTURE: VISION THROUGH 2035

good. Likewise, there will be deep-rooted


community relations and labor standards that Figure 6 presents the 2015 baseline calculation for
will be complied with and which commit all of each of the aforementioned goals.
the stakeholders to respect agreements in a As can be seen, the distance between the current
mutually beneficial long-term relationship.” situation and the desired one has to do with
increasing production capacity, cutting industry
As noted, the Alta Ley National Mining Program
promotes “innovative mining”, whose objective
is to improve the industry’s competitiveness and
productivity while simultaneously creating the
conditions for a robust R&D&I ecosystem with
local capacities and knowledge to emerge. FIGURE/6
2015 baseline and goals for 2035
IMPACT METRICS
Given the vision and the scope of the Alta Ley
National Mining Program, four impact metrics for 2015 BASELINE GOAL 2035
2035 were established:
· Achieving between 130 and 150
On average 5.5 million metric tonnes of On average 7.5 million metric tonnes of
million accumulated metric tonnes copper produced over the last 10 years. copper produced annually over the next
of copper and other minerals. 20 years.
· Situating 80% of the country’s mineral
production in the first two cost quartiles
for the industry on a global level.
· Creating at least 250 world-class suppliers. 40% of production in first cost quartiles for 80% of production in first cost quartiles for
· Achieving US$4 billion in mining- industry on global level. industry on global level.
related goods and service exports.

The Program’s impact metrics are established


on two work levels that complement each other 65 world-class suppliers 250 world-class suppliers
and provide mutual feedback: the first of these
establishes strengthening of the industry’s
productivity and competitiveness, from which the
program’s first two goals are derived. For its part, US$537 million in exports of mining-related US$4 billion in exports of mining-related goods
goods and service. and service.
the second level stresses the development of local
capacities, an area that is operationalized through
goals three and four. The implementation of this
Roadmap should contribute to the fulfillment of
these goals. Source: compiled by authors.

46 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 47
03 MINING OF THE FUTURE: VISION THROUGH 2035

costs and the development of world class graph/9


suppliers, in addition to expanding exports of
mining-related goods and services. Each of these
Estimated Chilean copper mine
gaps is addressed in depth below. production in 2026, kt of fine Cu.
Gap in production capacity

One of the main impact metrics associated with 9.000


the Alta Ley National Mining Program has to do
with expanding the production capacity for copper
and other minerals through 2035. Fulfilling that 931
7.000
goal will allow Chile to maintain its share of
around one-third of the global market, which is 1.249
also consistent with the percentage of reserves 5.000 302
that the country possesses. 1.270

kt de Cu fino
Though certain exercises have been undertaken
3.000
to estimate Chilean mining production in 2035
under a hypothetical scenario in which the totality 3811,5
of projects are materialized (see Lagos et al,
1.000
2015), the Cochilco (2015) information will be
used because there is not enough certainty on the
matter. 0
2014 2016 2018 2020 2022 2024 2026
Graph 9 shows Chile’s estimated copper mining
production in 2026. The estimate was made taking
Base/operators
into consideration the base scenario (current mine
Base/projects
operations and existing project portfolio), with
Probable/projects
three projected scenarios representing gradually Possible
higher risks of materialization, depending on their Potential/Cu Projects
conditions and current status.
Source: Cochilco (2015)

48 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 49
03 MINING OF THE FUTURE: VISION THROUGH 2035

To achieve the goal associated with the National development of new technological capacities, graph/10
Mining Program, the national mining industry institutions and human capital, among others. In
will have to produce an annual average of 7.5 this context, the gap is represented the distance
Cost structure for Chilean
million metric tonnes over the next 20 years. between the projected production levels for mining industry, by quartiles 4th Quartile
27%
There is a substantial gap here if one considers the two scenarios. Attaining the desired level
that the Chilean copper mining industry has of production requires materializing mining
2nd Quartile
produced an average of 5.5 million metric projects that have been classified as “probable,” 40%
tonnes of copper per year over the last 10 years. “possible,” and “potential.”

In addition, if current conditions remain Industry cost gap


unchanged, copper production will reach its The second goal is related to bringing 80% of
peak in 2017, with 6,304 kt of fine Cu. It will industry costs to within the first two industry
subsequently start to gradually decline until quartiles on a global level, in a context in which
reaching 5,081 kt of fine Cu in 2026. This the loss of competitiveness has become one of
scenario represents a low-potential scenario mining companies’ biggest concerns. 3rd Quartile
in which Chilean mining loses competitiveness 33%
and leadership with regard to global production For example, in 2003-2013 there was a 250%
and the country’s chances for productive increase in costs and in relative terms: Chile Source: Scotiabank GBM International Mining Industry
diversification based on the development of went from having lower costs than the average Report, cited in Leaders and Mining (Krebs, 2014)
an industry of goods and services suppliers among other countries, to being 6% less
will be reduced, as the scale and complexity competitive.
of the challenges that might stimulate
the development of local knowledge and To be sure, it is increasingly difficult for
technologies would be small. countries to differentiate themselves by cost According to Chochilco data, in 2014 Codelco and To operationalize the aforementioned standard,
and the competitiveness to attract investment is another six mining operations produced 80% of the criteria for considering a company to be a
In contrast, if Chile manages to overcome the being defined by non-geological factors, where the total copper produced in the country (Cochilco, world-class supplier is all suppliers that have
barriers currently preventing the competitive Chile is among the best-ranked countries. 2015a), which means that the transformation on exported goods and/or services worth over
development of the mining sector, copper However, production costs represent a the level of national production costs will mainly be US$1 million consecutively in 2012, 2013, 2014
production could reach 7,563 kt of fine Cu by 2026. disadvantage that must be addressed. There is the result of the progress that is made by the major (corresponding to the last years with numbers
a considerable gap to be closed before the goal companies in the industry so they can position available prior to the drafting of this report.).
Though this production is still less than the goal that has been set for 2035 can be attained. themselves on that level of global competitiveness.
proposed in the National Mining Program, it is As can be seen in Table 1, only 65 mining suppliers
considered to be a high-potential scenario that As can be seen in Graph 10 below, over 60% Gap in world class suppliers comply with the aforementioned standards,
not only ensures the competitiveness of Chilean of national production is in the last two cost The third metric is the creation of 250 world-class equivalent to 26% of the proposed goal. These
mining in the context of global production, but quartiles for global production, while the suppliers, which for the purposes of this document companies represent 20% of the suppliers that
also fosters the emergence of a productive remaining 39% is in the second quartile and are defined as those which can compete anywhere export and the amounts exported represent over
expansion process associated with the none is in the first. in the world in terms of efficiency and quality. 90% of the total exported by the sector.

50 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 51
03 MINING OF THE FUTURE: VISION THROUGH 2035

table/1 Gap in mining-related goods Exports by the Suppliers of the Chilean Mining
and service exports Industry in the context of the Alta Ley National
World-class suppliers The metric associated with exports of mining-related Mining Program. Table 2 shows the number of
goods and services sets the target of US$4 billion suppliers and the amounts exported in 2010-2014,
2012 2013 2014 in exports by 2035, which at a minimum means which reached a peak of US$654 million in 2012
equaling the salmon industry’s exports in 2014. and then began to gradually decline until reaching
Sales range, by sales
Number of Total (US$ Number of Total (US$ Number of Total (US$ US$537 million in 2014. This number would have
companies million FOB) companies million FOB) companies million FOB) Fundación Chile, together with ProChile and the to be multiplied by at least 7.4 times to achieve the
company Achiles, drafted the First Report on proposed goal (US$4 billion)
Large 57 594 57 520 57 484

SME 8 10 8 10 8 11

Overall total 65 604 65 530 65 495

Global results for sector 345 654 324 572 329 537 table/2
Exports and number of
Share of total 19% 92% 20% 93% 20% 92%
suppliers 2010-2014

Source: compiled by authors based on Fundación Chile data (2015).


2010 2011 2012 2013 2014

Total (US$ million FOB) 503 649 654 572 537

No. Companies 308 310 345 324 329

Source: compiled by authors based on Fundación Chile data (2015).

52 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 53
PRODUCTIVE DIVERSIFICATION AND
TECHNOLOIGCAL DEVELOPMENT IN MINING

INTRODUCTION
The mining sector opens up a unique opportunity
for productive diversification, technological
development and full social insertion. In particular,
exporting knowledge-intensive goods and services
is possible if one has mining as a foundation
and lever, given that the economic, social and
environmental challenges it faces can act as
unique driving forces to build the necessary
capacities to deal with these challenges, such
as developing an export portfolio consisting in
services, technologies and equipment.

At first glance some people might perceive this to


be contradictory. However, the truth is that more
mining is needed to reduce dependence on mining.

To be sure, this requires a long-term perspective


that goes beyond price cycles and in which the
investment projects and operational challenges
are used strategically. This, to anticipate situations
and to forge capacities that allow one to stay
abreast of the growing complexity of mine
deposits and their environments (see Figure
7), in that way compensating the increased
Fotografía Photograph BHP Billiton (Escondida)
complexity with the improved productivity derived
from new capacities. Otherwise the industry’s
competitiveness will gradually deteriorate,
thus impacting the level of production and its
contribution to the country.

Osvaldo Urzúa of BHP


Billiton was in charge of
drafting this section.

Alta ley alta ley Mining technology roadmap 2035 / 55


03 MINING OF THE FUTURE: VISION THROUGH 2035

figure/7 Thus, each stage can add something new, that will be needed to address the growing
something different, to the capacities that complexity of the geological, productive and socio-
Virtuous cycle, building new existed in the preceding stage, which not only environmental challenges that the sector faces.
capacities from the challenges helps the industry to maintain and to improve its
competitiveness, but is also a fundamental driver of This presents a unique potential for productive
national development because the new capacities and technological development to drive the
will not only impact the mining industry, but also transformation of the national productive base.
Transforming natural capital into social other industries and the economy in general.
capital Developing new capacities In other words, significant market potential
from increased complexity of mining Today’s challenges demand activities with high (demand for copper), together with abundant
knowledge content and with the more advanced mining resources that are complicated to exploit
technological and organizational capacities that (copious low-grade reserves, more demanding
P
CITIES IN RODUCTIVE are needed to close the productivity gaps ant to socio-environmental conditions) and significant
APA PRO
OFC CE increase socio-environmental performance. knowhow and experience create unique conditions
E SS
US to find the solutions needed to address the
The scale of the industry, together with the challenges and in that way seize the market
significant levels of productive, technological opportunity while developing new capacities,
and organizational knowhow and capacities that products and services associated with a sector
have been created and perfected in large-scale that exports knowledge that originated in the
mining over the course of decades – in a context mining sector but which goes beyond it when it
of abundant mining reserves and growing global comes to the potential to create a knowledge-
CAPACITIES COMPLEXITY demand for minerals, especially copper – creates exporting sector (see Figure 8). No other sector in
· Productive capacity The operation of mines
the conditions for building the new capacities Chile presents a similar potential
· Human Capital and the associated
· Technological capacity productive processes
· Infrastructure and service face growing operational,
· Institutional capacities environmental and social
· Other capacities complexities.
DE

SE
VE

PO

PM
LO

EN ES
T MIN
OF ES
NE NG
WC LLE
APAC HA
ITIES FROM THE C

Source: Osvaldo Urzúa (2016)

56 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 57
03 MINING OF THE FUTURE: VISION THROUGH 2035

FIGure/8 Experience teaches us that it is possible to expanded and become more sophisticated, with
Suppliers of Mine undertake the necessary efforts to take advantage new capacities created which allow new and more
of the opportunity that mining offers us. For complex challenges to be addressed.
Equipment, Technology example, in past decades the country was able to
and Services (METS) develop to the capacities that allowed it to take If today we want mining to continue to play
advantage of the potential that mining offered it, development platform role that it has been playing
Development of technology industries which led Chile to practically quadruple copper for decades, in addition to being the main copper
around mining. local content production between 1985 and 2005, becoming the producer in the world, Chile could become a power
production chain and high value. largest producer in the world. This is not a trivial in terms of innovation and the creation of shared
matter or a merely quantitative result. On the value related to the sector.
contrary, designing, building and operating mines
and mine processes on a large scale in a safe and Mining demands products and services,
Processing activity competitive way is a major achievement. Today the organizational and management models and
Operations and investments Closure downstream country has the experience, knowhow and capacity institutional capacities that can offer superior
to develop and operate large-scale mining projects performance by adapting, improving and even
Product using the best equipment and technologies creating the technologies needed to close the
Exploration Mine Processing Intermediate Manufacture available. In addition, Chilean engineering and productivity gap currently threatening the
design enjoy international prestige. industry. The mere transfer of “best practices”
is insufficient and requires an integrated vision
The practical requirement to resolve the that is comprised of everything ranging from
challenges associated with expanding production continuous improvement efforts to complex
while complying with higher environmental and technological development programs associated
Knowledge-intensive technology social standards was an articulating factor in a with the mining industry’s biggest challenges (see
based products and services · METS: Technology services
and mine equipment complex social process of collective learning. Figure 9). This need is the foundation that drives
· Knowledge exporter In addition to the significant contributions in the development of a knowledge intensive industry
· Inserted into global terms of the taxes paid, productive capacity was with a vocation for exports.
value chains
Hi-tech industries

Source: Osvaldo Urzúa (2016)

58 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 59
03 MINING OF THE FUTURE: VISION THROUGH 2035

FIGURe/9 MINING-BASED DEVELOPMENT: AN sure – being to incorporate more knowledge,


EVOLUTIONARY PROCESS innovation and technological development as
Portfolio with an integrated The industry’s development is an evolutionary driving forces to increase productivity and as a
vision of efforts process with diverse stages presenting new way to find solutions to the industry’s productive,
and bigger challenges over the course of time. environmental and social challenges.
A balanced portfolio with an integrated To address these challenges, new and more
vision ranging from the transfer of best advanced capacities need to be created based on This context provides a unique development
practices to disruptive innovations. preexisting capacities. opportunity for a sector of Mine Equipment,
Technology and Services (METS) suppliers
Sustaining this development process requires capable of contributing part of the high-value
DEVELOPMENT AND IMPLEMENTATION TIME
that all of the sector’s actors be capable of solutions to the mining sector and which are at
Immediate 1 year 2 years 5 years Long term adapting and guiding this evolutionary dynamics, the same time the foundation for developing a
which includes preexisting stakeholders as knowledge-intensive and exportable service and
well as new ones, in addition to their forms of products sector.
interaction and their development strategies, as
Projects No.

Collective-selective efforts
100 to 200 well as the environmental conditions or factors Figure 10 is a simplified illustration of the
Area 1
that might be influenced through public policy to evolutionary process that Chilean mining has gone
Individual-mass efforts

Improvement and transfer of practices/standards give direction and purpose to this evolution. through, starting in the 1970s with an industry that
took advantage of the comparative advantages
The capacity to adapt to new requirements built on a foundation of abundant high quality
Projects No.

60 to 100 determines the industry’s competitiveness and mineral resources, which has gradually been
Area 2 (a and b)
sustainability, as well as the success of this transformed and new capacities created to make
Collaborative innovations Incremental and Systematic evolutionary process. it an industry whose development is sustained not
just on its geological capital, but also on its other
The Chilean mining sector has followed an competitive advantages, which include, among
1 a 10 Projects No.
Area 3 evolutionary path like the one described above. others, a base of METS suppliers consisting in
This trajectory has not just driven the industry’s internationally competitive companies capable of
Technologic Program - complex innovations (strategic) growth, but has also provided an incentive to diversifying the export portfolio.
Focus on stability and cost national development.
Figure 10 also shows a potential scenario
Focus on productivity and cost The mining sector is currently making the associated with a successful evolution of the
transition to a new stage, with one of its main current stage, which is just beginning and still far
Making growth options viable challenges – though not the only one, to be from being considered a consolidated process.

· Internal effort · Innovations and ruptures


· Collaborative effort with third parties · Improved performance by existing products or processes
· Continuous improvement · New processes, methods, products and services
Source: Osvaldo Urzúa (2016)

60 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 61
03 MINING OF THE FUTURE: VISION THROUGH 2035

FIGURe/10 The stages illustrated in Figure 10 are Though a vast majority of the more advanced
summarized below: technologies and designs continue to come
Mining’s evolutionary process from abroad, increasingly sophisticated
– history and projection Stage I (beginning in the 1970s) services are being provided locally. Local
The industry’s main source of competitiveness suppliers not only assimilate foreign
Mining development as a dynamic in the first stage was its possession of abundant technology, but have also started to develop a
goal. Successive stages in a long high-quality mineral resources. This natural capacity to improve technologies and to develop
term evolutionary process competitive advantage allowed the development those of their own.
of large-scale competitive productive activities,
which became the country’s main source of This stage incubated the capacities for the
exports. emergence of a METS (mine equipment
technology and services) sector that should
Low income Middle income Country with In this stage access to more advanced solutions grow more intensively in the next stage to take
country country high income Internationalization and technologies was essentially through full advantage of its potential and to create a
and productive
diversification imports. However, the developing productive new technology and knowledge exporting sector.
Stage I Stage II Stage III base, together with rising levels of outsourcing,
Incubation of critical Development of Development provided the starting point or the first impulse We are currently probably still in this stage and
capacities supplier base of ecosystem for the birth of a local suppliers sector that there are indications that we are in the process
allowed new productive relations to be forged of making the transition to Stage III.
Factor-driven economy Investment-driven Innovation-driven
between mining firms and the local economy as
economy economy
represented by this emerging, though still low- It would be premature to say that the transition
impact, sector of suppliers. to the next stage is a consolidated process;
we are faced with the challenges and tensions
Comparative advantages Comparative advantages
The enclave structure under which mining inherent in all change. Will we be capable of
operated throughout a great part of the 20th successfully overcoming the barriers that
Factor-driven economy Investment-driven economy Innovation- driven economy century started to break down in this stage. present themselves in this transition?

1975 1985 1995 2005 2015 2025 2035 year Stage II (beginning in the 1990s) Stage III (showing its first signs today)
The main source of competitiveness in The capacity to produce innovative solutions
the second stage was produced from the will become a significant source of competitive
Source: Osvaldo Urzúa (2016)
efficiencies gained from heavy investments advantages in this third stage. The geological
to expand the productive base, which was capital, still very abundant but lower quality,
facilitated by an environment favorable toward together with superior technological,
the attraction of investments and whose organizational and institutional capacities, will
impact was reflected in a very significant help to maintain a process of rising productivity
increase in foreign investment that led to a and environmental and social performance,
threefold increase in copper production in just which lays the foundation of the industry’s
one decade. competitiveness.

62 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 63
03 MINING OF THE FUTURE: VISION THROUGH 2035

In this stage, a continually improving business outlook for the stage that the industry is currently
environment can address more sophisticated in. A strategy is needed that helps to create the
local demands. There are support industries conditions for making said transition.
with the capacities to deal with the challenges
of competitiveness and sustainability. The Technology Roadmap seeks to establish a
work agenda to add depth and systematicity to a
Advanced capacities are not developed in all collective learning or capacity-building process
areas, but rather in a particular METS group in all industry stakeholders. Everyone must learn
where knowledge, experience and enabling and protect the achievements made.
support systems (environmental factors) allow
sophisticated demands of the mining sector to be The Roadmap must be seen as a long-term
addressed. process that is under continual review and which
is regularly monitored and updated. It requires
These METS groups or sectors include institutions multiple and significant efforts that are only
and incentives to support innovation processes to possible to make with high levels of coordination
that suppliers can develop competitive products and public-private cooperation.
based on unique capacities that allow them
to develop differentiating strategies that can Stage III offers the great opportunity to develop
often be of a global scope. In this stage a METS high-value products based on copper, which is far
sector based on innovation is consolidated, one superior to the opportunities created by higher
characterized by its distinctive products and which levels of copper processing or production.
is more resistant to external shocks.
The country has a window of opportunity that is
A ROADMAP FOR STAGE IIII temporary and which requires acting with a sense
As noted above, the current context offers a mixed of urgency.

Photograph: Codelco (Copper concentrate)

64 / Mining technology roadmap 2035 Alta ley alta ley


Photograph. Codelco (Gabriela Mistral)
04 FACED BY
CHALLENGES

CHILEAN MINING
04 CHALLENGES FACED BY CHILEAN MINING

If we project copper
CURRENT SCENARIO AND SHORT
TERM CHALLENGES
5
Recent studies
reveal a drop in
While Chile’s potential for mining production direct costs (C1)
remains intact, the conditions that make the over the last three

consumption through
development of this industry possible have years, which
changed. Costs have increased, productivity reflects the result
of the cost-cutting
has declined and environmental and social plans that mining
sustainability have become imperative to companies

2035, an annual supply of


its development. All of these are challenges have been
implementing.
that the industry must deal with in the short
While this drop
term if it wants to ensure current production in costs has a
and materialize its future projects. circumstantial

65 million tonnes of fine


component related
to the drop in
MINING INDUSTRY COSTS oil prices and
Mining industry costs are a fundamental the US dollar’s
issue in times of low prices, when companie’s appreciation, it

copper will be needed,


main concern is productivity. Operating also contains
a structural
costs increased by an annual average of component, for
10% in 2005-2014. This situation, together example, related
with declining copper prices, has resulted in to an expanded

which means a threefold


availability
lower operating margins (Cochilco, 2015b).
of goods and
services.
Notwithstanding the fact that the vast majority
of mining firms have begun implementing cost-

increase in copper mine


cutting plans to overcome this situation5, the
problem continues to exist and poses a challenge
that mining firms must address in the short term.

production and existing


The Chilean mining sector faces a structural
problem. Mines are getting older and deeper,
which leads to lower ore grades, harder rock
andgreater material transportation distances. The following team from

recycling capacities
Fundación Chile was in charge of
drafting this section: Francisco
Klima, Tomás González, Nicole
Valdebenito, María Carolina
Soto and Hernán Araneda.

alta ley Mining technology roadmap 2035 / 69


04 CHALLENGES FACED BY CHILEAN MINING

In fact, the average ore grade declined 23.8% How does this impact on Industry costs? Mining Electricity consumption in copper mining
between 2005 and 2014. As can be seen in companies must extract and process increasing totaled 83,261 TJ (terajoules) in 2014, which is
the graph below, the concentration phase has volumes of material; the resources extracted equivalent to a 76.1% increase over 2001 and
shown a significant decline in average ore are increasingly harder and deeper. Considering 2.7% over 2013. For its part, fuel consumption
grades over the last decade, though it remains that mining is an energy intensive industry (over totaled 78,454 TJ in 2014, which represents a
the process with the highest grades. Meanwhile, 20% of its costs can be explained by this item), 101.4% increase over 2001 and 6.4% over 2013.
lower grades can be observed in dump leaching the situation described is translated into an
and/or ROM, while grades have remained increase in the industry’s costs due to an increase
relatively stable in heap leaching (0.1%). in unit consumption of electricity and fuel.

graph/11 graph/12
Average copper ore grades National energy consumption
at Chilean mining operations by copper mining, 2001-2014
by process type (Terajoules)

1,20 160.000
140.000
1,00
120.000
0,80 100.000

Terajoules
0,60 80.000
Chilean average 60.000
0,40
Concentrator
40.000
0,20 Heal Leaching
Dump leaching 20.000 Electricity
0,00 and/or ROM Fuels
0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Source: compiled by authors based on Cochilco data. Source: compiled by authors based on Cochilco data.

70 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 71
04 CHALLENGES FACED BY CHILEAN MINING

The open pit mine process accounts for 76% figure/11


of the mining industry’s fuel consumption
6
Total annual
(59,974 TJ in 2014). In the case of electricity,
energy Use of seawater in copper
consumption
the concentration phase consumes the most, divided by mining 2009-2014
with 43,685 TJ, followed by the processing annual copper
of oxides (LxSxEw), with 20,751 TJ. They production is an
approximation of Liters of water per second
represent 52% and 25% of the mining sector’s the unit energy
electricity consumption, respectively. consumption
coefficient. This
indicator allows
Upon examining unit energy consumption per
the trend in energy
tonne of material processed6, it increased by consumption for
54.4% in 2001-2014 (from 18.2 GJ/MTF in 2001 mine production to
to 28.1 GJ/MTF) This indicator also showed a be analyzed.
978 1.286 2.423
4.9% increase between 2013 and 2014. If fuels 315 242 713
and electricity are analyzed separately, once can
see that the fuel required to produce a tonne 2009 2010 2011 2012 2013 2014
of fine copper increased 66% between 2001
and 2014, while electricity did so by 45%.
Source: Cochilco (2014)
Increased water use in mining processes has
an effect on the associated energy costs: the
need for desalinated seawater and to pump it
many meters above sea level to mine operations FIGURe/12
increases demand for energy in a scenario in
which energy costs have also been rising.
Use of seawater in
copper mining 2014 (%)
This is a relevant factor to mining costs. It
is a fact that the main mining operations in
63%
Chile are in the northern parts of the country,
in areas that are generally desert regions
37%
with scarce water resources and where
there has also been rapid urban growth that
increases demand for the resource as well.

Use of seawater increased by 669% between Desalinated water Seawater without


desalination
2009 and 2014; in the latter year, 63%
was desalinated water and 37% water
without desalination (Cochilco, 2014). Source: Cochilco (2014)

72 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 73
04 CHALLENGES FACED BY CHILEAN MINING

MINING INDUSTRY PRODUCTIVITY graph/ 13


Productivity was not a central issue in the mid-
2000s, with copper prices breaking records
Evolution of copper mining
and increasing state revenues along the way productivity, measured as TPF
year after year. Today, however, in a scenario
of rising production costs, productivity has
become a central issue to the mining industry’s
sustainability in the short- and long term.
1,1
1,05 1,03
On a national level, the mining sector’s 1,01
1
productivity has a direct and indirect influence 1

1=2.000 base TPF, or A(t)


on Chile’s economic performance. As already 0,96 0,97
0,94 0,99
noted in preceding chapters, this industry
0,9
represents over 10% of GDP, around 50% of 0,87
exports and close to 20% of fiscal revenues, 0,84
meaning that reduced productivity has a direct 0,8 0,88
impact on the national economy. In addition, 0,8 0,8
reduced productivity affects direct and indirect 0,77
0,7
employment associated with mining and has
a major impact on a significant number of
0,6
companies that supply goods and services.
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
The concept of productivity refers to the
relationship between the inputs required and
resources used to obtain a given product (Cochilco Source: Cochilco (2014a)
2014a). The below graph illustrates a 20% drop
in the sector’s productivity in 2000-2013.

74 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 75
04 CHALLENGES FACED BY CHILEAN MINING

To be sure, it must also be taken into account that Even though the downward trend in labor They will be studied in greater depth in
falling productivity is not just due to declining productivity began to slow in 2014, it continues a second volume of this Roadmap.
ore grades and the quality of the geological to be a pending challenge that the industry
resource, but that it is also attributable to must address in the medium and long terms. One important challenge for materializing the
issues pertaining to business management, common vision defined in the context of the
the use of technology and differentiation REGULATORY PROBLEMS, SUSTAINABILITY Alta Ley National Mining Program refers to the
of human resources (Cochilco, 2014a). AND SOCIAL LICENSE delay in processing the permits associated
The topics detailed below represent very with mining projects. According to Lagos,
Labor productivity is a more precise measurement important, complex and socially sensitive Peters and Jara (2015), the average duration
of this. The below graph illustrates this problems. This subsection provides a of the project approval process increased from
indicator’s decline between 2006 and 2014, factual description of these subjects. 300 to 500 days between 2003 and 2011.
while at the same time showing a sustained
increase in remunerations through 2013.

graph/ 14 graph/15
Labor productivity in copper mining Average time (in days) for
and remunerations 2006-2014 obtaining an RCA

200 600
180
500
160
140 400
120

Days
Mining sector 300
100 remuneration
index (in US$)
80 200
60 Productivity index,
defined as fine 100
40 copper produced/
20 copper mining 0 Source: Lagos (2014)
payrolls.
0 2003 2011
2006 2007 2008 2009 2010 2011 2012 2013 2014
Source: Consejo Minero (2015)

76 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 77
04 CHALLENGES FACED BY CHILEAN MINING

However, Lagos, Peters and Jara (2015) argue figure/13


that the challenge does not just lie with cutting
the time to process Environmental Qualification
SMA inspections in 2013
Resolutions (RCA), but also in with reducing
the uncertainty associated with RCAs.
Number of facilities in %
An RCA is an administrative document issued
by the Environmental Assessment Service (SEA)
once the evaluation process for an Environmental
6% 9%
Impact Statement or Assessment (EIS or EIA, 5%
as appropriate) has concluded, in which it 4%
determines whether a project has been approved,
rejected or approved with conditions. That is, it
establishes the framework under which a project
can begin development and allows compliance
Equipment, Other economic Forestry and Diverse
with the regulations to be accredited and the infrastructure sectors agriculture manufacturing
respective environmental permits obtained. and properties facilities

On this matter, it is worth mentioning that


the Environment Superintendence (SMA), the
institution in charge of overseeing compliance 26%
with RCAs, was only created in 2010 on 23%
11% 16%
recommendations from the OECD, while
the Environmental Courts (overseen by the
Supreme Court) charged with the resolution of
complaints presented against SMA resolutions,
were only created in 2012. They are young
institutions that are still on a learning curve.
Fishing and Energy Mining Environmental
The SMA started to engage in environmental aquaculture cleanup
inspection and sanction activities on 28 December
2012. No fines were issued in the mining sector in
Source: SMA Annual Report (2013)
2012 and 2013, but inspection processes were begun.
In fact, mining concentrated 23% of inspections
in 2013 and the next year it was the sector with
the largest number of inspections per RCA.

78 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 79
04 CHALLENGES FACED BY CHILEAN MINING

figure/14 As of 31 October 2015 the SMA had issued


27 fines, of which five were against mining
SMA inspections in 2014 companies for a total of US$ 20 million,
or 63% of the total sum of sanctions
applied by the SMA in that period.
Number of inspections

While the president of the Supreme Court


declared in November 2015 that “no investment
71 66 34 33 25 project has been halted by order of the courts”
(Solorsa, 2015), Lagos et al. believe that the
environmental rulings that the Supreme Court
has had to intervene in over the last five years
make it impossible to detect a trend in the criteria
applied, which prevents projects from being
assigned with an environmental regulatory risk.
Mining Environmental Fishing and Energy Diverse This makes their financial evaluation, access
cleanup agriculture manufacturing
facilities to capital and their general development more
difficult and ultimately impacts the investment.
19 9 9 8 6
As Lagos (2014) notes, without implementing
any legislative or regulatory changes at all,
in 2004 the government and the judiciary
implemented a de facto change in demands
for projects, at the same time as a more
empowered citizenry made its weight felt
Agriculture Forestry Port Transportation Properties
infrastructure infrastructure with higher standards and considerations.

These opposing visions on the operation of


4 2 2 environmental regulation and oversight in
Chile speak of the need to articulate improved
dialogue among the different parties involved
and to facilitate Chile’s development with
social equity and care for the environment,
while simultaneously offering attractive
business opportunities to investors.
Equipment Hydraulic Territorial and
infrastructure development
planning in This phenomenon is clearly not exclusive to Chile.
regions Source: SMA Annual Report (2014) Over recent decades, all phases of mining and

80 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 81
04 CHALLENGES FACED BY CHILEAN MINING

metals production activities around the world graph/16


have been subjected to a continual and growing
4
21st UN
wave of environmental regulations that have had
Conference on Direct greenhouse gas
Climate Change
a profound impact on them, changing the contexts organized by the emissions by process
that they had been developing in (Cochilco, 2006). United Nations
Framework
Convention on
6
Greenhouse gas emissions are another relevant Climate Change

Millions of tonnes of CO2 eq


issue to be highlighted. In the current post-COP214 (UNFCCC). The 5
environment and the so-called “de-carbonization” Conference was
held in Paris from 4
of the economy, concerns over protecting the
20 November to 11
environment and public health will be translated December 2015.
into obligations requiring major changes in 3
the mining sector’s productive process.
2
According to Cochilco (2014b), direct greenhouse
1
gas emissions by the copper mining sector
from the Tarapacá Region through the 0
O’Higgins Region totaled 5.13 million tonnes 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
of CO2eq n 2013 , a 0.33 million tonne CO2eq
increase compared to the year before, when Services Smelting Underground mine
they totaled 4.8 million tonnes of CO2eq. LX SX EW Concentration Mine pit
Refining
Source: Cochilco (2014)
On a level of processes, Cochilco (2014b)
highlights that 76% of the industry’s greenhouse
gas emissions in 2013 correspond to ore
extraction in the mine pit area, 8.8% come from
the smelting process, 6.3% from associated
services, and 5.4% from the leaching process.

As processes that are more intensive in


electricity consumption, refining, concentration
and underground mining only concentrate
1% of greenhouse gas emissions each.

82 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 83
04 CHALLENGES FACED BY CHILEAN MINING

With regard to the unit coefficients of direct According to the Federation of Chilean Industry, Sofofa (with investments representing 30.8% of the
greenhouse gas emissions5, which allow
5
Amount of direct (2015), the scenario described above has caused total sectors studied), which emerge as a
greenhouse gas
the intensity of emissions to be evaluated emissions per detained investment in mining to increase from consequence of the lack of financing, the drop in
independently of the mineral or production, one tonne of fine US$12 million in 2009 to US$45.611 billion in 2014 international prices or the redesign of projects.
can see that the upward trend has mainly been copper and US$59.867 billion in the first 9 months of 2015. · Investments showing external difficulties,
due to the emissions factor of the mix of fuels or those beyond companies’ control,
used, totaling 0.89 tonnes of CO2eq/tonne in 2013. According to this Sofofa report (2015), have to do with judicialization (26.5% of
there are direct and indirect problems detained investment of the total sectors
holding up investments: studies), environmental regulation (18.1%),
graph/17 · The former include all investments that the high cost and scarcity of energy
have been halted due to internal decisions (15.1%) and judicial uncertainty (9.5%).
Unit coefficients of greenhouse gas
emissions per tonne of fine copper

0,9 0,88 0,89


graph/18
0,82 0,84
Mining investment projects No. 1
Tonne CO2 eq / MTF

0,8
0,8 0,77

0,69
0,7
0,63 0,61
0,61 0,61 150 mil 200
0,56 0,58
0,6
167

Number of initiatives
Millions of US$
148
0,5 100 mil 150
134 124
0,4 104
50 mil 100
0,3 71
61
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
0 50
Source: Cochilco (2014) 2009 2010 2011 2012 2013 2014 09/2015

Active Investment Detained Investment No. of initiatives


Source: Sofofa (2015)

84 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 85
04 CHALLENGES FACED BY CHILEAN MINING

graph/19 EVOLUTION OF COPPER EXPLORATION


ACTIVITIES, RESOURCES AND
Mining investment projects No. 2 RESERVES IN CHILE
This section is based on work done
by the Chilean Copper Commission
80 (Cochilco) between 2014 and 2015.

us$ One often hears arguments against


59.867
60 mining activities affirming that
us$
45.611 copper is a matter of the past and
Billion US$

us$
40.205 that the country should focus on the
40 technologies of the future. Without
losing sight of the development of future
us$
22.118 issues, it is important to put the role
20 us$ played by mining activity, especially
14.018 copper, into perspective regarding the
us$
us$ 2.845 development of societies and Chile, as
0.012 the largest producer in the world.
0
2009 2010 2011 2012 2013 2014 09/2015
To illustrate this, let’s think about
Detained Investment demand for copper. A developed country
requires 7 kg of copper per capita to fulfill
Source: Sofofa (2015)
consumption of final goods, while it is 2
kg per capita in developing economies
and just 0.2 kg per year per inhabitant
in underdeveloped countries. This is
The scenario described above poses a major translated into a global consumption of
challenge to the country. The mining industry 22 million tonnes of fine copper per year,
must prevent, compensate and/or mitigate equivalent to 3 kg of copper per inhabitant.
its environmental, social and cultural impacts
throughout the entire lifespan of its projects, If we project global copper consumption
while at the same time guaranteeing that affected through 2035, assuming that the entire
communities can participate in the diverse benefits population of the planet consumes
that it produces. (CNID, 2014). For its part, the state as much as a developed country, an The Cochilco Research and
must strengthen the capacities of the regulatory annual supply of 65 million tonnes of fine Public Policy Department was in
and oversight institutions to accompany the copper would be needed, which means charge of drafting this section,
industry’s evolution. This task must be understood increasing copper mine production coordinated by Jorge Cantallopts.
as a part of the national development process. capacities and existing recycling threefold.

86 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 87
04 CHALLENGES FACED BY CHILEAN MINING

A more conservative calculation is


obtained by estimating growth in demand
for copper at a rate of around 2% per
year for the next 20 years, in which
case an increase in supplies of over 11
million tonnes per year compared to
current production would be required.

Over the last 20 years, copper supplies


from mines as well as what is obtained
from recycling and scrap, has increased
like never before in history, yet they
have grown by just 9 million tonnes.

Based on this, one can anticipate at the


very least a future that is similar to the
last 20 years, regardless of current market
conditions and naysayers who have been
predicting the copper industry’s demise,
which make themselves heard more
loudly at moments like the current one.

The development of sustainable copper


mining entails environmental, social
and economic sustainability, with the
latter of these involving he industry’s
capacity to maintain itself over time, for
which the capacity of the activity, and the

Photograph: Codelco (Refinery Chuquicamata)


country in general, to more efficiently
take advantage of natural resources
requires that they be well-managed.

This is the area where exploratory activities


play a fundamental role in the sustainability
of the mining industry as a way to ensure
the operational continuity of existing
mines and to identify the deposits that
will be supplying future copper demand.

88 / Mining technology roadmap 2035 Alta ley


04 CHALLENGES FACED BY CHILEAN MINING

As mentioned, in the next 20 years The capacity to create these conditions is the development of mining activities, such
considerably more copper than that what given by the management of the natural as water and energy supplies, the availability
is currently produced will be needed and resource endowment, which requires of port infrastructure and, in some cases,
the new copper supplies will come from policies that foster the optimal use of even plant processing capacities.
three sources: new mines, expansion of mine claims and conditions that favor
existing mines and recycling. Expansions exploratory activities, such as basic EVOLUTION OF RESOURCES
will probably be one of copper producers’ geological information and support AND RESERVES IN CHILE
focuses, considering the current global trend for the riskiest exploration phases. The efficient exploitation of nonrenewable
of demanding a far higher environmental natural resources entails exploiting them at a
performance than they have had in the past, This section of the book is focused on rate that maximizes the resource endowment’s
especially new operations, and the lower risk these two conditions, which must be value over time. In a global copper market in
that expansions present compared to the fulfilled to ensure Chile’s protagonism which no single producer holds a dominant
search for new deposits. However, this source in the copper supply industry and in the position, an extraction rate is obtained that is
will not suffice to satisfy new demand. geological sustainability of mining activities. essentially demand-driven and that is what
determines the supply, considering criteria on
Meanwhile, there are many defenders First the evolution of resources and the maximization of private profits. This has
of recycling, especially among reserves in Chile is described, in addition meant that, in the face of significant increases in
environmentalists and those who oppose to the development of new mines over demand for copper over the last two decades,
mining activities, but numerous studies recent decades. After this the current the supply side reaction has been to increase
have already been produced that rate the situation with the administration and the extraction rate and expenditures on
recycling of new devices as complicated. use of mine claims in Chile is addressed, exploration, creating a dynamics for discovering
For example, a tablet contains far less along with the main challenges entailed, new deposits and gaining recognition
copper than a traditional computer and both from the perspective of public for new resources at existing mines.
the chance of recycling one is far lower administration as well as the creation of
or at least more expensive and with a conditions for the effective use of claims. One example of this dynamism can be
higher environmental impact, given the Subsequently the situation affecting the seen in the resources declared by the
complexity and reduced size of the latest exploration industry is described before USGS (US Geological Survey) in 1995,
devices. It does not seem very feasible finally analyzing the role that the state and which considering actual mined copper
to use current technologies to supply public policy must pay in different areas. extraction rates would have run out by
the new demand mainly with recycling. around 2012. However, new market
Among the issues addressed, those conditions marked by the so-called price
The world’s third and perhaps most important which stand out include: the production Supercycle that was in effect from late
source of copper will be new mines. of geological information allowing the 2003 until 2014 led to an exploration
Chile currently possesses 29% of known appropriate allocation of public and private boom and the reclassification of resources
copper reserves, which gives it a significant resources to an activity characterized by recognized by the USGS in 2014, which
advantage from the geological perspective. risk; the existence of development and together with the copper extracted
However, the conditions must be created financing policies for exploratory activities; during 1995-2014 is equivalent to 3.4
to make the most of these advantages. and the availability of basic infrastructure for times the reserves identified in 1995.

90 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 91
04 CHALLENGES FACED BY CHILEAN MINING

graph/20 In Chile’s case in particular, the USGS statistics


show that in 2014 the country’s reserves
Total world coper reserves and totaled 209 million tonnes of copper, which
estimated useful lifespan together with the almost 112 million tonnes
that have already been extracted over the last
two decades, new mines and changes in the
economic classification of resources for market
800 40 reasons, has caused copper reserves to increase
3.6 times over what they were in 1995.
700 35
Billions of Tonnes

600 30
500 25

Years
400 20 graph/21
300 15 Evolution of copper
200 10 reserves in Chile.
100 5
0 0
250 35%
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
30%
World copper reserves (Billions of Tn) Useful lifespan in years 200

Billions of Tonnes
25%
Source: Cochilco based on USGS (1996-2015)

Percentage
150 20%

100 15%
10%
50
6
For the purposes 5%
Another way to look at it is to consider that
of estimating 0 0%
annual copper extraction was around 12 million extraction rates 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
tonnes in 19956, which implied 10.2 million it was assumed
tonnes of fine copper in mined copper supplies, that recovery
levels will remain Reserves Chile (Billions of Tn) Chilean share of global reserves
meaning that the reserves identified would
constant and that
have lasted 25.6 years. Meanwhile, 21.7 million they represent
Source: Cochilco based on USGS (1996-2015)
tonnes of copper were extracted in 2014, but 85% of the
considering current reserves this extraction mineral.
rate could be maintained for 32.3 years. Now, if
we consider an annual increase of 3%, current
global reserves would last for 20 years.

92 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 93
04 CHALLENGES FACED BY CHILEAN MINING

In terms of useful lifespan, it is estimated that MANAGEMENT OF MINE CLAIMS IN CHILE


The total reserves incorporated in Chile, current resources give our mines an average The basis for developing mining activities in a country The current mine claims system has managed to
including those already exploited over the lifespan of 29 years. However, based on lies with its resource exploration strategy, which is have significant impact, as is reflected in the sharp
last 20 years, are close to 240 million tonnes. public information from the main operations, translated into the way that mining rights for the increase in Chilean copper mine production as the
While the large mines like Chuquicamata, El in other words Andina, Radomiro Tomic, exploration and exploration of mineral resources are 1990s. Chilean mining production increased by 3.9
Teniente, Pelambres, Andina, Los Bronces, Collahuasi, Escondida, El Teniente, Sierra Gorda, managed and awarded. This variable constitutes an times between 1983 (the year that the Mining Code
Escondida or Collahuasi are all over 20 years Chuquicamata or Antofagasta Minerals’ Centinela initial guarantee that determines the responsibilities entered into effect and with it the institutional
old, in the last two decades the discovery District, the useful lifespan is around 50 years. In and limitations that holders will have to engage in framework for mine claims) and 2003, growing
of at least 38 new deposits has been addition to illustrating the size of these deposits, mining. Thus, the concepts associated with mine from 1.2 to 4.9 million MTF of mined copper. In
announced, according to data from Cochilco this situation reveals a pattern in exploration: for claims correspond to one of the most important addition to this sharp increase in production,
and SNL. The period was fairly fruitful in economic reasons it is preferable to engage in decision-making criteria when it comes to deciding on another key aspect to be highlighted is the
terms of quantity, but just regular when brownfield exploration around existing operations which investments to make (United Nations, 2011). increase in private production. Private production
the volume of new reserves is compared rather than in unexplored, or greenfield, areas. increased by 13.6 times between 1983 and 2003
with discoveries made before, such as In Chile’s case, mine claims are managed as (from 0.2 to 3.3 million MTF of mined copper). For
Escondida and Collahuasi in the 1980s. The dynamism of exploration activities is expected concessions, which can be for exploration or for its part, Codlelco’s production increased 1.5 times
to continue over the next 20 years, despite the exploitation. The institutional framework, governed (from 1 to 1.5 million MTF of mined copper).
cycles affecting them. If today we have an average by the Constitutional Organic Law on Mining
of 29 years’ worth of copper to exploit, the new Concessions (1981) and the Mining Code (1983), The evidence presented above would appear to
discoveries will probably extend our mining upholds the current foundation for the development imply that the increase in Chilean production was
industry beyond 2045. In addition to our natural of mining activities in the country. While industry due to an increase in the price, which provided
resource endowment, this requires a series of actors have considered the system to be successful, a significant incentive for new actors to arrive
policies that allow the value of that endowment to it has not ceased to be criticized over potential and add to production. However, over that same
be maximized. These policies should be focused negative effects or inefficiencies with regard to period the price trend was on the decline while
on mine claims management and the promotion its ultimate goal of promoting mining activities. total mine production increased by 6.6 times.
of exploratory activities, especially greenfield.

The following sections address these two


issues, providing an assessment of mine
claims management and its impact on
the activity. An analysis of exploratory
activity is subsequently undertaken.

94 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 95
04 CHALLENGES FACED BY CHILEAN MINING

graph/22 Figure/15
Evolution hectares under Concentration of mine claims in
Concession (millions of ha.) 15th, First and Second Regions
Marked property concentration in the Arica
18 Exploration and Parinacota Region (15th), the Tarapacá
16 concessions Region (First) and the Antofagasta Region
Millions of ha.

14 Exploitation (Second), where the 10 largest claim holders


12 concessions concentrate around 70% of the market.
10
Annual variation
8 average
6 exploitation
4 Annual variation

10
2 average potential NATIONAL
0 exploitation 15Tth · Arica y Parinacota
AVERAGE

40%
1995 2005 2014
Source: Sernageomin (1995, 2005 and 2014) LARGEST CLAIM
HOLDERS
CONCENTRATE
First · Tarapacá

The mine claims system created an effective way


to register deeds for exploration and exploitation
Concentration of property
According to analysis by Cochilco using
70%
OF MARKET
of mineral resources. This is reflected in the Sernageomin data, there is evidence of marked
levels of investment that have been registered property concentration in the Arica and Parinacota Second · Antofagasta
over the last 30 years, which ultimately result Region (15th), the Tarapacá Region (First) and
in the expansion of Chilean copper production. the Antofagasta Region (Second), where the 10
largest claim holders concentrate around 70%
Despite the significant impact that the current of the market, far above the national average of
mine claims concession system has had on 40%. For its part, the Atacama Region (Third) is
Chile, it possesses certain traits that have not consistently below the natinoal average, with a
necessarily favored the efficient use of claims, broader distribution of mine claims, something
resulting in concentration, lack of dynamism and that could be associated withthe development of
the underuse of claims awarded in concession. small- and medium scale mining in the region.
Source: compiled by authors based on Cochilco data.

96 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 97
04 CHALLENGES FACED BY CHILEAN MINING

This situation gives an impression of unequal If one adds to the levels of claims concentration graph/23
distribution of concessions, which could an analysis of the percentage of territory in a
go against the very reasons why they were municipality that is available, one can see that
Percentage of area traded
awarded. Concentration of claims in the the municipalities of María Elena and Tocopilla, in on average in 2006-2013
mining industry could be explained by intrinsic addition to showing high levels of concentration,
factors associated with capital requirements have less surface area available for new claims.
or levels of geological knowledge, meaning
that it might not necessarily represent a priori It is worth noting that mine claims concentration 4,00%
inefficiency on the part of the industry. is not necessarily a sign of market inefficiency, 3,50%
as the owner of a mine operation might need 3,00%
Likewise, it has been established that to obtain better information on the extent of a

Percentage
2,50%
concentration on a national level has remained deposit, for which the surface requested initially
at similar levels since 2000, while among mining would have to be overestimated to ensure that 2,00%
regions only the Antofagasta Region showed a resources are not left out. Viewed from another 1,50%
significant increase in its levels of concentration perspective, an operation could have a claim 1,00%
during the period analyzed. For their part, Arica outside the actual location of an operation due to
0,50%
y Parinacota and Tarapacá have shown a general the fact that there are reserves considered in the
trend toward reduced concentration since 2006. mine planning whose exploitation would be in the 0,00%
XV I II III IV V RM VI VII VIII IX XIV X XI
This same trend can be observed, though in a less medium and long term, which would represent an
pronounced way, in the Atacama Region, which efficient behavior from the industry’s perspective. % Area traded National average
has even remained below national averages.
Concentration could avoid becoming a problem if Source: Cochilco based on Sernageomin data.
On a municipal level, the 10 municipalities there is rotation and an effective use on the part of the
considered highly concentrated are between the activity. In the case of claims rotation, measurement
Arica y Parinacota and the Atacama Regions. They of the volatility or instability of a market represents
are: Camarones, Colchane, Camiña, Mejillones, a way to account for the level of activity and the In this context, on average deed holders show a significant decline. On a level of the 10
Calama, Ollagüe, San Pedro de Atacama, transactions produced internally in the market, which decide to maintain 95% of the previous year’s largest mine claims holders in the country, one
Tocopilla, María Elena and Alto del Carmen. is generally associated with its entry and exit barriers. exploitation area and exchange 2%. The can see that they only contributed 17% of the
remaining 3% of the area is eliminated from exploitation concessions that changed hands.
the registry for the next year and also, the
new area incorporated represents 10% of the Lastly, when the period 2000-2013 is
immediately preceding total exploitation area. analyzed one can see that close to 65% of
the exploitation area was maintained over 14
The regions can be seen to behave in a relatively years (17% with different owners and 48%
similar way, meaning that one cannot affirm with the same owner), which is evidence of
that there is greater movement of claims in a certain market stability when it comes to
regions that are of greater interest to mining. exploitation concessions and claim holders’
Only the Seventh, Eighth, Ninth and 12th Regions tendency to maintain them over the long term.

98 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 99
04 CHALLENGES FACED BY CHILEAN MINING

Use of property FIGURe/16


The conditions of concentration in poles of
7
Political
geological interest and stability in ownership of
Constitution of Estimation of
the State of Chile,
mine claims are not conditioning factors that 1980. main claims
cause the market to operate inefficiently. Both
factors can be understood as rational decisions
8
Defense refers
to the existence
on the part of claim holders who are engaged in of owners who
mining activities in the area under concession. create mine
concessions 73% Claim holders related to mining activities.
to defend the
As noted in the Political Constitution of the
activities engaged
Republic, a mining concession obliges the in on the surface
claim holder to engage in the necessary activity from malicious
34% Claim holders located in municipalities
to satisfy the public interest that justified agents seeking to
impose the right with registered operations.
awarding it7. Likewise, diverse authors have to the subsoil
highlighted that the mining concessions system over the right to
does not currently promote a concession’s the soil, merely 23% Claim holders located in regions
development or use for mining purposes for the purpose with registered mining activity.
of obtaining
(Moscoso & Contreras, 2005; Cochilco, 2006; economic
Cochilco, 2008; Jara, 2007; León, 2012), which compensation 7% Claims associated with mine activity
undermines the country’s mining potential and not for
engaging in mine site in Chile (León, 2012.).
either for speculative purposes or in defense
mining activities.
of the land8. Meanwhile, other work (Cochilco,
2011) also indicates excessive exploitation 9
It should be Source: Cochilco based on data from Sernageomin and León (2012)
conditions, whose indefinite duration against the noted that this
value does not
payment of an annual fee hinders development consider the
and investment in exploratory activities. use of the claim
for exploratory
It is worth noting that lower levels of claims purposes or
the different
use for copper mining purposes, estimated requirements in
in regressive models (León, 2012), would be terms of mine It should be noted that there are at least three conditions do not allow. Third, the claim holders
around 7% of the total area under concession9. area for non- general situations that explain a reduced use of use their claims for speculative purposes without
metallic mining. claims for mining purposes. First, those claims that, any interest in engaging in mining activities. Lastly,
According to a Cochilco analysis, estimated while not currently in use, have been recognized there are cases of claim holders who use a mine
use of mine claims is around 23% of the total in the past and for which geological information concession to protect activities that are engaged
exploitation area, considering concessions is available. Second, claims that might not have in on the surface due to the stronger property
with claim holders in the region where a mine registered activity of any kind, either because the rights that they convey over the surface property.
operation has been declared. The results claim holder has not yet decided how to obtain The literature contains specific data confirming
of this analysis are summarized below: recognition for the area or because external the existence of the last two cases (León, 2012).

100 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 101
04 CHALLENGES FACED BY CHILEAN MINING

EXPLORATORY ACTIVITIES regard to 2012, when the industry graph/24


A fundamental aspect of economic registered a historic budget allocation.
10
Base metals,
sustainability of mining activity is the
gold, uranium, Evolution in global exploration
diamonds,
industry’s capacity and that of hte This reaffirms the cyclical nature of platinum group, spending and Chile’s share
state to replenish the resources that exploration investment and is in line molybdenum,
are extracted. While it is true that with the downward trend in metals silver and others.
mineral resources are not renewable, prices, represented by the IMF index.
in only a tiny proportion do they 8%
25
emerge spontaneously and expensive The total amount registered for this year
7%
and complex work must be done to is US$8.771 billion, almost US$12 billion
determine their precise location and less than in 2012, when global exploration 20 6%
quality. In this sense, exploration is expenditures reached their peak.

Percentage
US$ billion
fundamental to guaranteeing the 5%
15
sustainability of the mining business. The proportional increase in mine site or
4%
“mine” exploration continued to stand out
Cochilco is currently engaged in in 2015 and has been on the rise since 10 3%
a series of projects that analyze 2011, surpassing basic exploration since
and evaluate the performance of 2014. This is evidence that exploration 2%
5
exploratory activity, especially with firms are more averse toward risk, which 1%
regard to non-ferrous minerals10. is higher in the early stages of a mining
2015 was the third consecutive year project and in greenfield projects. 0 0%
with declining global exploration 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
budgets for non-ferrous minerals, Meanwhile, advanced exploration, which
which were cut by 18.3% compared had remained at over 40% since 2005,
Total expenditure (US$ billion) Chile’s share (%)
to 2014 and were down 57.3% with has fallen to close to 37% in 2015.
Source: Cochiilco based on data from SNL Metals & Mining (2015)

102 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 103
04 CHALLENGES FACED BY CHILEAN MINING

Regarding distribution by type of mining company, The situation in Chile is not much different graph/25
the so-called majors, or large mining firms, from that of other mining countries. The mining
continue to be the most relevant actors, with exploration budget in 2015 fell to US$615 million,
Exploration spending in Chile
48.8% of the global budget, as has been the or just over US$90 million less than the year by stage Millions of dollars
case since 2012. Their total budget was down before However, the country did position itself
18% in 2015 compared to the year before. among the most important countries again,
1,200
rising to fourth place after its global share
For their part, junior companies’ market share rose to from 6.6% in 2014 to 7% in 2015. This
1,000

Millions of dollars
was down for the second year in a row, from result illustrates its stable increase in market
32.3% in 2014 to 29.3% in 2015, with a global share since the beginning of this century.
800
25.8% budget cut, which reveals how sensitive
this sector is to slumps in mineral prices. The share of participation in the basic, advanced 600
and mine exploration phases has remained
In terms of destination, the Americas concentrate similar in 2015 (SNL Metals & Mining, 2015), 400
half of the budget committed for 2015, where totaling close to US$200 million that year. It is
North America, including Mexico, concentrates worth highlighting that all three stages registered 200
over half of that budget. On a country level, Canada smaller budgets, with the mine site or “mine”
remains in first place with 13.5%, followed by stage being the most affected with a budget that 0
Australia and the United States with 12.2% and was down -20.5% compared to the year before. 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
8.2%, respectively. Chile comes in fourth and In the case of basic and advanced exploration,
China fifth, with 7.0% and 6.2%, respectively. they were down -12.5% and -5.2%, respectively.
Basic Advanced Mine

Source: Cochilco based on data from SNL Metals & Mining (2015)

104 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 105
04 CHALLENGES FACED BY CHILEAN MINING

If we analyze budgets according to their CONDITIONS FOR STRENGTHENING use for purposes they have been assigned for. In
exploratory focuses, in Chile the search MINERAL EXPLORATION IN CHILE this context, considering the advantages of the
for base metals continues to predominate, As this document has shown, while copper Chilean concessions system and the complexity
with 70.2% of the 2015 budget allocated to mining is classified as an economic activity entailed in changing it, it would be very useful
that area. Within this group, copper attracts dedicated to the extraction of nonrenewable to work on reaching the necessary consensuses
almost the entirety of this investment while a resources, it has characteristics that are so that can allow currently assigned properties to
smaller amount is allocated to zinc prospects. dynamic and complex that it is unrealistic effectively be used for what the concession was
The second metal is gold, with 26.4%, while to analyze from that perspective alone. awarded for and to produce value for the country.
the remaining percentage can be attributed
to a mixed group of other resources like First, it is highly likely that the world’s need for Three major lines of action have been
silver, molybdenum, rutile and lithium. copper in the future will be greater than it is now, identified to promote exploratory activities:
something that represents a great opportunity
Among the 10 companies with the largest to the country if we consider that we have the Production of geological information:
exploration budgets in 2015, the Chilean firm world’s largest endowment of the mineral and The availability of reliable and opportune
AMSA leads with 15%, followed by Codelco with vast knowledge on how to exploit it. In addition, precompetitive geological information
10% and the Australian firm BHP Billiton with past exploratory activity would appear to is currently a decisive factor in the
9% of the Chilean total. This year the inclusion guarantee mining activities in the country for competitiveness of mining districts. Chile
of the Canadian firm Lundin Mining in the top the next 50 years, at least at the largest mines. has taken important steps in this direction,
10 and the US company Freeport McMoRan’s However, a series of conditions are needed to take such as creating the figure of Competent
departure stand out, as does the Australian better advantage of our resources, optimizing the Person in Natural Resources and Mineral
company Hot Chili, the only junior in the top 10. use of the mineral endowment and creating the Serves and the approval of the regulation
conditions to explore and subsequently exploit it. associated with Article 21 of the Mining
In Chile, majors, or large-scale mining Code, though implementing this as part of
companies, are the most significant actors In the area of mine claims, there is evidence that an efficient system is a task that continues
in the area of exploration with 77.9% of the the judicial certainty of our concessions system under way. The Sernageomin’s implementation
budget, significantly higher than the global has played a key role in the development of mining of a national geology plan is also a sign of
average (48.8%). Their total budget was down activity. However, the levels of concentration are progress. However, policies and resources
11.4% in 2015 compared to the year before. quite significant, especially in some municipalities, are still needed before we have a geological
For their part, junior companies’ market which can affect the adequate allocation of the and property information system that is
share has maintained stable at 13.2% in resources located there. Furthermore, property appropriate to the importance that exploration
2015, while their budgets were cut by 9.6%. turnover levels are low, which is not a good sign industry has and should have in Chile.
of efficient use, especially when one considers the
As these numbers reveal, exploratory activity fact that, according to Cochilco estimates, no more Development of instruments to promote
in early stages and in particular among junior than 23% of exploitation concessions show some exploration: There has been much debate
companies is one of the hardest hit during sort of exploitation activity. This underscores the in Chile regarding the advantages of a tax
slumps in mineral price cycles and is therefore pertinence of debating mechanisms to speed up incentive for exploratory activities to make the
the segment that public policy should focus on. the consolidation of mine claims and allow their expenses of this stage of the mining business

106 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 107
04 CHALLENGES FACED BY CHILEAN MINING

tax deductible, as is the case in economies The existence of available mine claims, ENERGY
that are more developed in this area, such financing and quality geological information The mining sector currently exports around 6
as Canada and Australia, where the activity do not guarantee that the exploration activities million tonnes of copper per year while consuming
by exploration companies is an engine that will be undertaken, as the inexistence of roads, 21.9 TWh (terawatt-hours) of power, in a context
drives their financial industries. However, that electricity and water distribution, treatment of rising costs and declining productivity.
is not the only way to stimulate exploration, plants and port facilities restricts exploration
as there is also the possibility of allocating regions to areas where these conditions do Copper mining is expected to need 39.5 TWh by
funds through competitive processes like exist, or else conditions the search for projects 2025, with the mines located in the area of the
the Corfo’s Fénix Fund, or through direct on prioritizing ones that are of a scale that Northern Interconnected System (SING) the main
allocation as is the case in Australia and allows said infrastructure to be financed. source of demand, with 23.3 TWh, while they will
Canada in periods like the current one, when consume 16.1 TWh in the Central Interconnected
risk capital financing becomes scarcer and As can be appreciated, there is still considerable System (SIC) (Cochilco, 2014c).
exploratory activity becomes depressed, with room for improvement when it comes to
the subsequent increase in unemployment the performance of exploratory activities in
and impact on the long-term sustainability Chile and in that way maximize the value
of extractive activities. In this context, the of our mineral resources, in addition to
Enami’s reserve recondition instrument is creating all of the links that can be derived
a sign of the existence of this type of policy, from this stage in the mining business.
but it needs to be evaluated and probably
updated before it can be strengthened. This is one of the areas for improvement
that is added to those already identified by
Creation of basic infrastructure: One rarely the Alta Ley National Mining Program and
thinks of the existence of basic infrastructure Fundación Chile, where Cochilco has provided
for exploitation as an incentive to exploration. valuable industry information and analysis.

The following team from


Fundación Chile was in charge of
drafting this section: Francisco
Klima, Tomás González, Nicole
Valdebenito and Hernán Araneda.

108 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 109
04 CHALLENGES FACED BY CHILEAN MINING

graph/26
National electricity consumption
by copper mining 2014-2015,
by maximum, expected and
minimum costs 2014-2015 (TWh)

50
45
40
35
30
TWh

25
20
15
10 Maximum consumption
Expected consumption
5
Minimum consumption
0
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source: Cochilco (2014c)

Photograph. Codelco (Gabriela Mistral)


110 / Mining technology roadmap 2035 Alta ley
04 CHALLENGES FACED BY CHILEAN MINING

The concentration process is expected to be the graph/27


main driver of increased electricity consumption.
This is because the mineral characteristics of
Copper Mining’s expected
the deposits mean that a large number of the consumption of electricity by
expansion projects and new projects are using
this technology. This process is projected to
process on a national level.
increase its participation in consumption from
Participation in mining sector’s total energy
11.2 TWh in 2014 to 24.4 TWh in 2025, or 119% consumption by process, 2014 (21.9 TWh).
increase. In addition, given that concentration
operations make intensive use of water,
the electricity consumption associated with
desalination of seawater and pumping it to
operations will increase 5.4 times, from 1.2 TWh
to 6.25 TWh in 2014-2015 (Cochilco 2014c).
51%
24%
7% 6% 5% 4% 2% 1%

Concentration LXSXEW Smelting Desalination Services Mine Refining Underground


and pumping pit mine

Participation in mining sector’s total energy


consumption by process, 2025 (39.5 TWh).

62%

17% 7% 4% 4% 3% 2% 1%

Concentration Desalination LXSXEW Smelting Services Mine Underground Refining


and pumping pit mine

Source: Cochilco (2014c)

112 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 113
04 CHALLENGES FACED BY CHILEAN MINING

When projects are analyzed according subsequently drop in 2035, to 1.9 times graph/28
to their execution conditions, it is the energy consumed in 2013.
11
Which would
determined that those rated as
amount to 46.0 Projected accumulated demand
TWh, a number
“possible” could begin to demand According to information from the that is consistent for electric power required by
electricity in 2017 and reach a total Association of Chilean Electricity with Cochilcho’s
consumption of 7.67 TWh in 2025, Generators (Generadoras de Chile) 12, estimate for 2025 copper mining industry as of
(46.3 TWh).
which in turn would account 19.4% as of 31 December 2014 the SIC and 2015, measured in MW, for the
of expected energy consumption on the SING had an installed capacity of Revised 25
SING, SIC and the national total
12

that date. For its part, demand from 19,966 MW, representing over 99% of November
2015, at http://
potential projects would come in 2020, the country’s entire installed capacity
generadoras.
totaling an expected 8.56 TWh by 2025, (Medium scale grids like Aysén and cl/generacion- 3000
or 21.7% of the total (Cochilco 2014c). Magallanes, in addition to other isolated electrica/sector-
systems, represent less than 1% of generacion- 2500
electrica/
Cochilco (2014c) affirms that the total installed generation capacity) 2000
national mining sector’s maximum (Generadoras de Chile, 2014).

Mw
energy consumption could reach 46.3 1500
TWh, in an optimistic scenario in which The SIC’s installed generation capacity is 1000
all operations continue as planned and in 15,180 MW, of which 52.5% corresponds
which all projects are commissioned on to thermoelectric power plants, 41.9% 500
time and with the productive capacities hydroelectric generators, 4.3% wind 0
their owners have projected power and 1.3% solar plants. For its part, 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
the SIC’s installed generation capacity is
Following a logic that is complementary 4,785 MW, of which 95.6% corresponds SING SIC Total
to the above, Lagos, Peters and Jara to thermoelectric power plants, 0.2% Source: Cochilco (2015c)

(2015) engage in a projection exercise hydroelectric generators, 1.9% wind


that supposes total development of power and 1.9% solar plants.
copper mine production in Chile through
2035 as a result of an accelerated Cochilco (2015c) estimates that,
development of all Chilean copper according to expected electricity
reserves. The authors determined in this consumption, an additional 2,500 MW
work that by 2025 energy consumption in generation capacity would be needed
would reach a peak of 2.1 times what to satisfy the copper mining industry’s
it was in 201311, due to the increased demand in 2015-2025, of which 1,100
capacity of concentration plants, mines MW would be in the SIC and 1,400 MW
and services, in addition to reduced in the SING. The below graph shows
participation by leaching processes accumulated projected demand for
in the chain of production. The mining generation in the SING, SIC and the
sector’s demand for energy will national total.

114 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 115
04 CHALLENGES FACED BY CHILEAN MINING

Regarding the cost, Lagos et al. (2015) say that, Table/3


to achieve the scenario of total execution of
13
EAPI.
projects, among other things the price of energy
Energy Architecture Performance
must remain under US$100/MWh, which will Index (EAPI), 2015
directly depend on increasing energy supplies
and is also associated with the established goal of Price of EAPI EAPI Dimensions
competitiveness, considering that energy currently Country Electricity
for industry Development Safety
represents between 25% and 30% of the total Ranking Ranking Sustainability
Score and Growth environmental and
(US$/KWh) access
Global Lat. Am.
operating costs and that it can even surpass 50%. economic energetic
Australia 0,06 0,66 38 n.a. 0,67 0,45 0,87
However, the World Economic Forum’s Energy
Architecture Performance Index for 201513 affirms Norway 0,07 0,79 2 n.a. 0,68 0,74 0,96
that industry pays a price of US$120 per MWh in
USA 0,07 0,66 37 n.a. 0,59 0,51 0,89
Chile. In addition, Chile can be seen to be in an
uncompetitive position, both in terms of the price Peru 0,08 0,68 31 6 0,79 0,55 0,71
of electricity paid by industry as well as in the
Canada 0,09 0,69 25 n.a. 0,59 0,61 0,89
general energy architecture performance indicator.
Colombia 0,10 0,74 9 1 0,75 0,61 0,84

Chile 0,12 0,67 34 7 0,65 0,55 0,82

Switzerland 0,13 0,80 1 n.a. 0,71 0,79 0,89

Brazil 0,16 0,70 20 5 0,56 0,71 0,82

China No data 0,53 89 n.a. 0,46 0,40 0,71

Source: WEF (2014a and 2014b)

Though the energy structure’s impact on mining 2050 Energy Agenda is a step in this direction).
companies’ costs is a current problem, the scenario In addition, mining companies must continue
described above poses a long term challenge that to promote the development of technologies to
the country must address. improve the energy efficiency of their productive
processes and foster the use of renewable
On the one hand, the state must make progress energies. Ensuring the mining sector’s long
in materializing an energy policy that is aligned term sustainability lends a sense of urgency to
with the country’s current and future needs (The this challenge.

116 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 117
04 CHALLENGES FACED BY CHILEAN MINING

WATER graph/29
Water is considered a strategic resource in the
mining industry due to the rising use restrictions
Evolution of copper mining’s
in a context of lower supplies and, consequently, consumption of fresh water and
higher costs to obtain it.
seawater 2009-2026 (m3)
According to Cochilco (2015c), total water
21,5
consumption will increase 41.4% between 2014 19,7 19,7 20,8 21,3 21,3
and 2026, reaching a total of 21.5 m3/s. 20 19 19
16,7 17
15,2 15,8 16
13,8
By 2026, the consumption of fresh water is 15 13,3 13,4
expected to decline by an annual average of 1.9% 12,6 12,9
over the amount estimated for 2015, for a total

m3/s
10
of 10.8 m3/s. Thus it would almost equal the
use of seawater, which it is estimated will reach
10.7 m3/s by 2026 and is projected to grow at an 5
annual rate of 14.1%.
One of the main reasons for declining 0
consumption of fresh water has to do with the 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
expansion of the Coloso desalination plant, which
is expected to start operations in 2017 with a
capacity of 2,500 l/s. In addition, more and more Fresh water Seawater Total
mining firms are joining in the construction and
Source: Cochilco (2015d)
expansion of desalination plants of their own as a
way of dealing with fresh water restrictions.

The following team from


Fundación Chile was in charge of
drafting this section: Francisco
Klima, Tomás González, Nicole
Valdebenito, Hernán Araneda
and Ulrike Broschek.

118 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 119
04 CHALLENGES FACED BY CHILEAN MINING

In terms of processes, the consumption of fresh the industry’s seawater consumption by region Table/4
water on the part of concentration plants will are that the Atacama Region will lead this trend,
continue to grow due to the lack of new projects followed to a lesser extent by the Atacama
Installed capacity for use of
in the area of copper hydrometallurgy and the Region. With regard to fresh water, the analysis seawater in copper mining.
exhaustion of leachable minerals. Concentrators, anticipates a decline in its share of consumption
which accounted for 71% of freshwater in the Antofagasta Region and a slight increase in
consumption in 2015, could account for as much Atacama, while remaining relatively constant in EXPECTED YEAR OF DESALINATION DIRECT PUMPING
OPERATION
as 82% in 2026, while the cathode electrowinning other regions. The change in the projected trend COMMISSIONING CAPACITY (l/s) CAPACITY (l/s)
process will fall 12% to 4% over the same period. is due to the larger number of projects in the
Michilla Operating 75 23
Antofagasta Region that would use seawater in
Regarding expected seawater consumption, their processes and the need for additional water Mantoverde Operating 120 -
the majority of increased consumption is also supplies to process primary copper ore, causing
projected to come from sulfide concentration the Antofagasta Region’s share to fall from an Escondida (Coloso) Operating 525-2,500 -
projects (rising from 87% in 2015 to 91% in 2026) estimated 43% in 2015 to 21% by 2026. Thus the
Mantos de la luna Operating - 78
while hydrometallurgy operations will show a Atacama Region would take the lead, with 23% of
proportional decline their use (from 7% in 2015 fresh water consumed by that same year. Centinela (Esperanza) Operating 50 780 -1,500
to 4% in 2026). Furthermore, increased use of
seawater is characterized by greater variability, According to this projection, the number of copper Antucoya Operating 20 280
as of the total projected in 2026, 40% would be mining operations that would use seawater in
Las Cenizas (Taltal) Operating 9.3 12
associated with projects classified as possible their processes would total 17, as detailed in the
and potential. Cochilco (2015c) projections on table below: Sierra Gorda Operating 63 1,315
Pampa Camarones Operating - 12.5
Candelaria Operating 300 -
Encuentro 2018 20 115
Diego Almagro 2018 - 315
Santo Domingo 2018 2.5-290 389
Radomiro Tomic 2018 1.630 -
Dominga 2019 450 -
Spence 2019 800-1,600 -
Quebrada Blanca 2020 1,300 -

Source: Cochilco (2015d)

120 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 121
Regarding the impact of using desalinated (which in turn are determined by the distance
seawater in mining operations that consume over from the coast and the plant’s location), which
200 l/s, the conceptual estimate made shows range from 7 and 27 US¢/lb.
that, in a scenario where the cost of energy is
US$100/MWh, the operations studied could see This estimate considers infrastructure works, the
their costs rise by an average of 16 US¢/lb., of desalination plant, the pumping system and the
which 10 US¢/lb are the effect of operating costs pipelines to reach the altitude that the processing
and 6 US¢/lb. the investment analyzed. This plant is located at. The approximate operating
indicator varies depending on the pumping needs conditions are indicated below:

Table/5
Characterization of operations
based on fresh water No. 1

Variable unit Range AVERAGE

Plant altitude m.a.s.l. 750- 4,400 2,400

Water consumption I/s 200-1.,500 880

Distance from the coast Km 60-250 170

Source: Cochilco (2015d)


Photograph: Codelco (El Teniente)

alta ley Mining technology roadmap 2035 / 123


04 CHALLENGES FACED BY CHILEAN MINING

Cochilco (2015c) considers the following


premises to estimate the order of magnitude: BOX 6:
WATER SWAPS
Table/6
Characterization of operations The original definition of a swap, For agreements that are mutually
based on fresh water No. 2 exchange or barter comes from the beneficial to be reached, the party that
area of finance and it refers to a cedes water must receive clear benefits,
contract between parties to exchange such as:
Variable unit VALUE cash flows in the future according to
a pre-established formula. They are · Receiving a larger volume of water
CAPEX desalination plant US$/(m3/day) 1,739-1,940 “tailor-made’ contracts that satisfy than is currently available.
specific needs of the signatories and · Receiving water of the same or better
CAPEX piping US$/m 736 the purpose is for both parties to gain quality than currently supplied.
from the agreement. · Reducing the cost of water
CAPEX pumping Th. US$/unit 3.75
per m3 by sharing costs.
Energy price US$/MWh 50-100 Their application in management of · Increasing security of supplies at lower
water resources refers to the exchange altitudes, agreeing to release water
Electricity consumption (desalination) KWh/m3 3,4 of said resource and not the purchase supplies from higher altitudes in the
of water on the part of the parties event of problems with the desalination
Electricity consumption (pumping) KWh/m3 43,221 involved. For example, let’s suppose plant or the distribution system.
that there is a company operating at · Ceasing to exploit aquifers that
Source: Cochilco (2015d)
a high altitude in need of water where are overexploited, or recharging
there is a water source at a similar them downstream.
altitude that is used by another user
group at sea level. In this case, the The company located at the upper end
company could choose to desalinate will only agree to a swap if the cost of
Based on the above, investment values of between seawater and deliver it to the users supplying water to the lower altitudes
US$122 and US$615 million were calculated, downstream in exchange for being able is lower than the cost of pumping water
which was mainly determined by the facilities’ to gain access to the high-altitude water to the higher regions, without affecting
location. The system’s total operating costs sources. This would allow the company the environment and managing the
(desalination and pumping) range from between to make its processes more efficient resource use in coordination with sectors
1.8 and 3.6 US$/m3 of treated water (considering and to cut the costs associated with the downstream. All excess water beyond
an energy cost of US$100/MWh), which is directly installation and operation of a system to the demand upstream must continue to
related to the altitude and the distance that the pump water to high altitudes, while the flow downstream through the basin to
desalinated water must be pumped. users at sea level would have access to protect the environmental flow and to
better supplies of the resource. allow aquifers to be recharged. In this

124 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 125
04 CHALLENGES FACED BY CHILEAN MINING

sense, an environmental impact study For this type of project to be MINING AND CLIMATE CHANGE: TRANSITION TO A
is a mandatory part of this type of swap materialized, it is fundamental for the Drafted by the CIRCULAR ECONOMY
Fundación Chile’s
agreements, as is securing commitments population to be informed and to perceive Sustainability The year 2015 will go down in history as historical
to increase security of water supplies. the associated advantages. The biggest Department due to the universal agreement reached at the
obstacle is the insecurity posed by a new COP21 Climate Change Summit in Paris, where
The possibility for users to exchange source, which is why the population must 195 countries agreed to mitigate climate change to
water extraction points and sources have a clear idea of the options available keep the planet from increasing its temperature by
to compensate the resource’s scarcity for dealing with it and even to realize that more than 2°C by 2100, thus replacing the Kyoto
has been the subject of debate in Chile the resource will become more available Protocol as of 2020. This agreement, which finally
for many years. Swaps between the because both sources, the original one included China – currently the most-polluting
companies supplying water to the and the new one, will be available in the country in the world –, will enter into effect when
cities located along the Pacific coast event of an emergency. countries totaling a minimum of 55% of global
and mining companies located in the emissions ratify it by the 21 April 2017 deadline.
high mountains at altitudes of over Another important point is the recharging
4,000 masl have been considered in the of aquifers with desalinated water or While our country is not on the list of the main
northern parts of the country. In this diversions. The lack of a social license greenhouse gas emissions producers – representing
case, water sources would either be creates opposition in the population over just 0.3% of total global emissions – Chile’s
desalination or diversions. the legitimate fear that they might lose emissions have nevertheless increased sharply,
their sources of water and depend on growing by 74.1% just between 2008 and 2009. In
Fundación Chile started an analysis in desalination. In addition, agreements are addition, according to the Intergovernmental Panel
this direction in 2009. For example, the made more difficult when no economic on Climate Change (IPCC) and the World Bank, Latin
project Aquatacama was an initiative advantages can be perceived, even America is one of the regions that is most vulnerable
that received the support of the French when the availability of water resources to the effects of climate change, a phenomenon
Government to study the possibility of improves at lower altitudes. whose cost – according to the UN ECLAC – could
bringing water from the Bio Bio Region, come to account for as much as between 1.5%
with intakes along the way at Rapel, using Lastly, it is fundamental that the and 5% of annual regional GDP if the temperature
an underwater pipeline. The availability risks associated with the closure of increases by 2.5ºC above the historical average.
of water at sea level would allow swaps companies located in the higher regions
between the downstream users of be prevented, especially all aspects Chilean mining makes intensive use of both
aquifers and users at higher altitudes. related to the cost of water and its water and energy. A fundamental feature of these
Unfortunately the swaps did not prosper. impact on the population. resources is their mutual interconnection, which
is known as the Water-Energy Nexus due to the
principle that power generation requires water and
energy allows water to be transported and treated.
Climate change naturally has a direct negative Petar Ostojic and Neptuno
effect on this balance, which is why the mining Pumps were in charge of
industry must take the lead in the fight against drafting this section.
global warming, as it has done with its commitment

126 / Mining technology roadmap 2035 alta ley


Alta alta ley Mining technology roadmap 2035 / 127
04 CHALLENGES FACED BY CHILEAN MINING

to the sustainable development of its productive toward attaining energy efficiency and cutting goal of replacing the linear consumption
processes and to make a contribution to the social energy consumption by 23% would allow the model that exists today. It has historically had
and economic development of its communities. mining industry to potentially mitigate CO2 large amounts of easily accessible and low-
emissions by 18% in 2020. However, in 2015 cost energy and raw materials available and
Over the last 15 years the Chilean mining sector’s President Michelle Bachelet committed herself been based on the principle of “produce-use-
greenhouse gas emissions have increased at before the UN General Assembly to cutting dispose,” which is switching to a circular model
an annual rate of approximately 5.3% due to Chilean CO2 emissions by 30% and as much that uses the resources – valuable, scarce
declining ore grades, greater transportation as 45% in 2030, a commitment materialized and finite – responsibly and efficiently and
distances and increased production, which all lead through the enactment of an energy efficiency with low levels of greenhouse gas emissions.
to increased consumption of electricity – power law, the implementation of a carbon emissions This new model is now known around the
that is mainly obtained from the SING, mostly tax – included in the recent tax reform – and world as the “circular economy.”escasos y
fueled by coal, and from fuels (Cochilco, 2012). the inclusion of renewable energy sources, finitos- de manera reponsable y eficiente
which are projected to account for 60% of total con una baja emisión de gases de efecto
According to a study by the British-Chilean energy production in 2035 and 70% in 2050. invernadero. Este nuevo modelo es conocido
Chamber of Commerce (Britcham) Climate hoy a nivel mundial como “economía circular”.
Change Committee, only 0.01% of companies in The mining sector has taken important steps
Chile measured their carbon footprints in 2014, toward becoming a sustainable industry
the country’s main mining companies among and the policies to make the transition to
them. Currently Compañía Minera Doña Inés de renewable energies will help to significantly
Collahuasi is the only mine to measure its carbon cut indirect emissions from electricity
footprint from all three aspects – direct emissions, purchases. However, energy efficiency
indirect energy emissions and other indirect policies are not enough to significantly cut
emissions – following international standards like direct and indirect emissions or to fulfill the
UNE, ISO 14,064-1:2006, the GHG Protocol and targets that the government set for 2035.
British Standard PAS 2050. This gives us a real While mining is an extractive activity and is not
and representative value for a mine operation’s characterized by the production of goods and
emissions. Of a total of 2,068,991 tonnes of CO2 services, in Chile it has become the main engine
emissions in 2014, 24% were direct emissions, 53% of the economy and to drive development of
indirect in the form of electricity purchases and technology, entrepreneurship and innovation.
another 23% other indirect emissions (domestic This allows it to play a leading role in the new
transportation of products, domestic flights, activities industrial era that is unfolding worldwide. This
by suppliers and contractors, among others). new stage, which the World Economic Forum has
The implementation of energy efficiency called the “Fourth Industrial Revolution,” (2016),
policies and the inclusion of renewable energy not only envisions the use of new manufacturing
sources in the power matrix are currently the and information technologies, the incorporation
main measures that mining firms have used of renewable energy sources and alternative
to reduce their carbon footprints. As early as fuels or the use of nanotechnology, robotics an
2009 a Cochilco study affirmed that efforts artificial intelligence, but also has the ultimate

128 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 129
04 CHALLENGES FACED BY CHILEAN MINING

Figure/17 As the name indicates, the circular economy


is a sustainable, repairing and regenerative
Circular economy diagram economic concept based on three fundamental
pillars: the use of renewable energy, energy
efficiency and efficient use of resources. The
Mineral extraction/
circular model holds that the production of
Harvest/ Manufacture of goods and services includes closure following
collection materials their planned life cycle, reducing consumption
and the waste of raw materials, water and
Biological Technical
energy. In addition, the circular economy seeks
Materials Materials to extend the life cycle of products as the design
Biosphere Manufacture of parts philosophy facilitates reuse and recycling of
Raw material materials and components, in addition to the
Biochemistry Manufacture of products Recycling remanufacture of products and equipment.
Technical Renovation/
Materials Recycling A mining operation in Chile produces between
Production of services
300 and 400 tonnes of waste material per
Reuse/redistribution month, among parts and equipment, which are
generally sold or simply dumped as scrap for
Biogas Cascades
Maintenance the best offer a price per kilo. However, in a
circular economy model, the reuse of materials
Consumer User
Anaerobic and remanufacture of products could mean up
digestion/ to 60% less energy consumption for suppliers,
composting Collection
a reduction in CO2 emissions of up to 70% and
reduce waste by up to 75%. Currently there
Raw material
for biochemical are already Chilean companies that supply the
extraction mining sector whose catalogue is up to 60%
Energy recovery
products that have been manufactured and
Losses remanufactured using totally recycled materials.
to be minimized Many of them have received international
acknowledgement for being pioneers on a global
level in implementing circular economy model.
Dump

Source: Ellen MacArthur Foundation (2015)

130 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 131
04 CHALLENGES FACED BY CHILEAN MINING

BOX 7: NEPTUNO PUMPS IN THE


GUARDIAN: 10 CIRCULAR BUSINESSES
IN THE DAVOS SPOTLIGHT
This Chilean manufacturer produces 60%
of its pumps using reused and recycled Source: The
materials. This includes remanufactured Guardian, (Flynn
pumps where almost all the parts are 2016)
reused or recycled. The buyer gets a
pump that’s 30% cheaper, but still comes
with a one-year warranty. Neptuno
is based in the Atacama Desert, one
of the driest places on Earth and the
heartland of Chile’s multibillion-dollar
mining industry, a huge consumer of the
country’s scarce water resource. Through
its design, Neptuno claims its pumps
can help mining companies recycle up
to 70% of their water, which cuts energy
consumption by up to 30%.

Photograph Neptuno Pumps

132 / Mining technology roadmap 2035 alta ley


Alta
04 CHALLENGES FACED BY CHILEAN MINING

The arrival of new technologies like 3D printing by BHP Billiton and Codelco or the creation of its associated impacts – on the environment,
or the Internet of Things (IoT) is speeding up the new public-private agendas that seek to emulate public health or related communities. However,
transition to a circular economy based on local successful experiences – like that of Australia – in over recent decades trends in regulation and
design and manufacturing capacities that are the development of the METS (mining equipment, public opinion have opened up a new front
tailored to the needs of each client. At the same technology and services) industry. for the industry that goes beyond the borders
time, mining has not ignored the new business of productive operations and which involves
models based on the Sharing Economy or Over recent years, companies as diverse as everything that happens with the product once it
collaborative economy, concepts that has have Google, Unilever, Ikea, Coca-Cola, HP, Philips and leaves the plant.
had a cross-cutting impact on all industries, Caterpillar have taken measures to make the
transforming conventional business models based transition to a circular economy and have received In this context, we understand sustainable product
on the sale of products and post-sales services the support from private institutions with global management as meaning a management system
into new Product-as-a-service (Paas) business recognition like the Ellen MacArthur Foundation that allows:
models. In this model, users do not have to buy the and the World Economic Forum. On a government · Knowing and controlling the environmental
products, making the supplier responsible for their level the message has escalated to spaces like and health risks associated with the product
availability, reliability and efficiency. The product’s the European Commission, which in December from the moment it emerges from the process,
manufacturer owns it and can therefore make 2015 adopted an ambitious and historic package including the subsequent phases in its life
decisions on its design, use, maintenance, reuse, of measures on the circular economy that assured cycle: handling and transportation; uses for
recycling and remanufacture throughout the entire investments for 650 million euros for research manufacturing and the production of items
life cycle, offering end users a service in exchange and innovation, in addition to 5.5 billion euros that contain it; the uses that consumers give
for a regular fee. for structural funds to undertake regenerative it, and final disposal and recycling activities.
processes and to upgrade waste management.
Thus, the manufacturer is in charge of cutting These measures are expected to add 1% growth to · Promoting rules, regulations and standards
down on energy consumption, the use of raw GDP, which would create over 2 million jobs. that ensure the sustainable and safe
materials and waste. This allows access to use of a product and its derivatives, but
sustainable and better quality products. Chile and its mining industry cannot allow which at the same time do not hinder its
themselves to be left out of this process, as commercialization and access to markets.
Chile’s mining cluster offers favorable conditions not only does it represent a chance to boost
for implementing the circular economy model companies’ competitiveness, create jobs and use · Promoting the development of innovative
and developing innovative solutions that help resources more sustainably, it is also about an uses of the product and its derivatives that
to improve productivity, foster efficient use of effective tool to reduce the carbon footprint and contribute to sustainability (for example,
resources – energy, water and raw materials – and fight climate change. improving the energy efficiency in processes,
cut the direct and indirect CO2 emissions of mining reducing the environmental footprint,
operations. In addition, introducing the circular REGULATORY CHANGES AND contributing to the quality of human life, etc.). The Codelco Department of
economy model can update and give new drive to NEW USES FOR COPPER Commercial Planning and Market
initiatives that have had high-impact results on the Sustainable management in the mining sector · Monitoring and anticipating substitutive Development was in charge of
mine-supplier virtuous cycle, such as the World- is generally understood to represent sustainable trends that affect the mining industry’s drafting this section, coordinated
Class Suppliers Program (PPCM) implemented management of the productive process and portfolio of commercial products. by Victor Pérez Vallejos.

134 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 135
04 CHALLENGES FACED BY CHILEAN MINING

figure/18 For the mining sector, a sustainable product · Scant professional capacity in the industry
management focus entails, among other things, to address issues associated with evaluating
The four dimensions of sustainable making efforts and allocating resources to an the environmental risk associated of metals.
product management area in the business chain that until now it has · Very poor knowledge of relevant
tended to ignore: the end use of the raw materials scientific literature or the criteria and
it produces. mechanisms underlying the
Knowing and controlling the environmental · Regulatory decisions regarding the
and health risks associated with the product It is clear that if one of these uses is subjected risks of chemical substances.
from the moment it emerges from the to regulatory restrictions or is accused in social · Scant knowledge of the appropriate
process, including the subsequent phases in communications media of posing alleged health institutions and channels for action before
its life cycle: Handling and transportation; uses or environmental risks, the economic effect can international regulatory organizations.
for manufacturing and the production of items be as great or more serious than an production
that contain it; the uses that consumers give stoppage or a decline in ore grades or prices. The case of copper piping was a relatively simple
it, and final disposal and recycling activities. event compared to the scenarios that the mining
The urgent need for the international mining industry is now beginning to face. Expert opinion
Promoting rules, standards and industry to address this aspect of its business has indicates that these scenarios will only become more
regulations that ensure the sustainable been growing for several years and it has often complex and extensive in the future and will involve
and safe use of a product and its not been totally prepared to successfully deal aspects ranging from products’ intrinsic physical-
derivatives, but which at the same time with developments on the regulatory or public chemical features to the impact of their final disposal
do not hinder its commercialization perception fronts, which threaten to limit market on the environment and human beings.
and access to markets. access for their products or their derivatives, or
else make them less competitive regarding other CHALLENGES POSED BY A COMPLEX
competitive products that can replace them, not REGULATORY SCENARIO
based on cost, but rather sustainability criteria, Access to international markets is and will be a
apparent or real. critical issue for the viability of national mining
Promoting the development of innovative uses of activity. In this context, the industry currently faces
the product and its derivatives that contribute to An early example of this was in the late 1980s, a very diverse range of regulatory challenges
sustainability (for example, improving the energy when the World Health Organization took moves related to their chemical composition and the
efficiency in processes, reducing the environmental to characterize copper as an element that poses a dangers or risks it might pose to public health and
footprint, contributing to the quality of human life, etc.). high risk to human health, which had they prospered the environment. Some examples of this type of
would have made the copper piping market for regulatory scenario are:
drinking water unviable. In this case, a virtuous
alliance among Chilean Government institutions, · Globally Harmonized System of Classification
Monitoring and anticipating substitutive national and foreign scientists and industry trade and Labelling of Chemicals (GHS).
trends that affect the mining industry’s associations managed to overcome the threat. · The European Union Directive on
portfolio of commercial products. However, as these efforts developed certain the Classification and Labeling
weaknesses in the sector were detected when it of Hazardous Substances.
Source: compiled by authors. came to dealing with this type of development: · International Maritime Organization:

136 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 137
04 CHALLENGES FACED BY CHILEAN MINING

International Codes and Conventions registration, evaluation of hazardousness Chile does not currently have the technical these regulatory developments or standards
on Maritime Transport and the risk posed by substances, labelling capacity to address this challenge and companies are produced (APEC Chemical Dialogue,
· System for the Registration, Evaluation, and the development of new forms of Safety typically send their samples to labs in developed International Maritime Organization, the OECD,
Authorization and Restriction of Chemicals Data Sheets; and the implementation of safe countries, which are often surpassed in their United Nations). The development of trained
(REACH; European Union, South Korea). handling, transportation and use practices for capacity (thanks to the proliferation of these human resources and funds to finance said
· Basel Convention products. They also establish criteria under which regulations). In other cases, the specific participation is fundamental to giving Chile
· European Union Directive on Biocidal Products. transportation (by sea or land) and even the entry requirements associated with the characterization a greater presence in the multiple technical
· Environmental Assessment Framework of certain materials into given countries can be of certain products are not part of the standard committees where decisions are made that end
for Products (European Union) forbidden For example, the European Union’s battery of analysis available on the market. An up having an impact on commercialization or
· Regional and national water quality criteria REACH (Registration, Evaluation, Authorization illustrative example is the Metals Dissolution and access to markets by the products that sustain
for metals (USA, European Union, Chile, etc.). of Chemicals) Directive includes mechanisms to Transformation Protocol established by the Global the country’s national development.
· ROHS (Restriction Of Hazardous establish temporary restrictions or directly and Harmonized System to assess the aquatic toxicity
Substances in electrical materials definitively forbid the importation or manufacture of metals and non-soluble metallic composites: Thus, the challenge to guarantee the future of the
and electronic goods) Directive. of given substances based on the risks that Currently there are just three laboratories in the national mining business is to develop the human
· Life Cycle Impact Indicators for materials, they are believed to pose to public health or the world capable of implementing it reliably (one capacities and equipment that allow national
used by regional or national authorities to environment. The burden of proving the contrary of them struggles to survive in Chile under the companies to successfully deal with the regulatory
award projects financed with public funds. – under strict scientific and technical criteria – auspices of the Mining Ministry). demands an threats that are to come, in that way
naturally falls to the importer or the manufacturer. ensuring the mining business’s access to markets
Some of the provisions contained in these This shortfall also has a dimension involving with its products and its sustainability.
regulations and frameworks are having an impact A GAP IN PROFESSIONAL AND analytic intelligence of regulations. Each of the
on the feasibility and costs associated with TECHNICAL CAPACITIES regulations mentioned above poses its own INNOVATION AND PROMOTING SUSTAINABLE
importing certain products to European, Asian The implementation of said regulation is challenges in terms of interpretation and adapting USES FOR COPPER
and North American markets. For example, the demanding increasing levels of technical and to the reality of each product, transport scenario Without doubt, better knowledge of an
recent amendment to Annex V of the International scientific capacity to assess the dangers and and destination market. Chile has scant human element’s properties and its effects on the
Convention to Prevent Pollution from Ships (Marpol) chemical, toxicological and eco-toxicological capacity to engage in these tasks and in some environment or living beings opens the door
obliges vessels transporting bulk materials risks that products pose. These levels are cases it simply does not exist. As a result, the to new uses for it that not only expands
considered damaging to the environment to particularly sophisticated for products with mining companies operating in developed markets potential markets, but also contributes to the
treat the waste waters from washing their holds complex, heterogeneous and variable chemical are often left at the mercy of services provided by sustainability of human activities.
in “appropriate facilities” (which do not exist in compositions, as is the case with many of the third parties (for example industrial associations
practically any port in the world), forbidding them products produced by metals mining (for example, in Europe or the USA), whose interests do not A significant part of the challenges that
from being dumped at sea, and all at the shipper’s mineral concentrates). Compliance with these necessarily coincide with those of the national humankind faces today has to do with global
expense. Determining whether a material is demanding data quality standards is critical mining industry. Frequently these associations warming, energy efficiency, the availability of
harmful to the marine environment or not is based to fulfilling both the regulations that govern also lack the specialized capacity in these issues. water and food for people, among others. The
on highly technical criteria established by the imports, handling, storage and transportation uses copper has plays a fundamental role in
United Nations Global Harmonized System. of substances, as well as for defending the These weaknesses are multiplied due to the addressing all these needs and will continue to do
classification criteria that the industry believes Chilean state apparatus’s scant capacity so as resources are allocated to the development
Many of these international regulations applicable appropriate and to avoid precautionary and to participate effectively and opportunely of new uses over time and a national innovation
to mining products do not just demand the restrictive classification perspectives. in the international bodies where many of ecosystem focused on this area is developed.

138 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 139
04 CHALLENGES FACED BY CHILEAN MINING

A recent example of this potential is the explosion is important that demand for it be upheld by entrepreneurship possible, aspects that are
of high-value applications for metallic and foundations that are firm over time. fundamental to closing the existing gaps between
non-metallic copper, where it is used as an the technological challenges and products’ entry
antimicrobial material. For example, using it in Specifically, the industry’s biggest challenges can into markets.
hospitals has the potential to reduce intrahospital be summarized in the following seven points:
infections and have a positive impact on health cutting processing costs, maximizing added This once again demands that the mining industry,
indicators while cutting the use of antibiotics. value, increasing competitive value against other research centers, entrepreneurs and development
Similarly, there is solid evidence that using materials, resisting changes in regulation and mechanisms consider sustainability beyond their
copper alloy cages for aquaculture increases standards, ensuring the strong performance of productive processes and their relationship with
the productivity of the aquaculture industry, products made of copper, increasing the use of the environment, but also include the far broader
expands the industry frontiers by allowing farms complementary materials, and designing products aspects of end uses and how they contribute to
in exposed marine areas, reduces the activity’s to be recyclable and recoverable. the planet’s sustainability.
impact on neighboring ecosystems and gives the
product a smaller carbon footprint. Development of markets must be considered to be So far Chilean mining has placed the responsibility
a process that is ongoing over time, one that must for dealing with these challenges in the industry’s
In addition to the above and as technology and articulate cross-cutting innovation ecosystems to international trade associations. Though it is clear that
society continue to progress, the emergence of integrate science, entrepreneurship and financing they have made a very valuable contribution, there
new substitutes and other threats will always before the threat of substitution has irreversible is no doubt that these groups’ interests are far from
remain latent. In every sector where copper impacts on Chile. the same as the interests of Chile, a country whose
has a presence in terms of consumption there present and future would seem to be indissolubly
are alternatives that compete with it and seek As we saw above, there are many opportunities linked to its mineral wealth and the opportunities it
to replace it. This is why it is fundamental for to innovate, grow and to show all of the potential offers throughout the entire value chain.
the country and the copper industry to develop associated with the red metal as a sustainable
technological innovation capacities associated material that can bring tremendous benefits to
with the properties of copper, through research, society. Taking advantage of these opportunities
entrepreneurship and business models that help can make the difference, not just in the copper
to diversify the uses of copper and reinforce industry, but also in the process of economic
its competitiveness over time through an open development and growth for all Chileans.
innovation model that is articulated on a national
level and with a vision of global impact. The quest for innovative applications that could
be intensive in copper use or not, in terms of
There is a need to develop existing markets and tonnage, must always be related to the high added
to strengthen emerging markets to ensure copper value provided as a benefit to society and to the
remains current as a material, taking advantage challenges of the modern world.
and strengthening all of the capacities that Chile
has developed and which it can continue to Developing new uses for copper requires
develop. Our country and its economy depend innovation ecosystems that stimulate innovative
on the copper market and for this reason it thought and make specialized research and

140 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 141
Fotografía Codelco (Mina Rajo y Planta Lixiviación Salvador)
05 CORE
GRAVITATING

CHALLENGES
05 GRAVITATING CORE CHALLENGES

Referring to areas
CORE CHALLENGE TAILINGS
BACKGROUND The chapter Gravitating Core
The copper mining industry extracts large Challenges of the Mining Road
volumes of material, of which only a small Map was developed based on

at the heart of the


fraction corresponds to the element of economic work by Enrique Molina, Director
interest that one seeks to recover. Once this of Innovation in Mining at
material has been processed and the copper and Fundacion Chile, who identified the
other elements of value have been extracted, sector’s challenges and structured

mining process that


waste known as tailings is produced (comprised the gravitating core challenges.
of ground material, water and reagents).
The Core Challenge Tailings section
Tailings are transported via pipelines to places was drafted based on work by the

present the most


specially conditioned for their deposition, known technical commission created for the
as reservoirs or dams depending on the method core challenge, which was comprised
used to build the retaining wall (a reservoir’s of the following members: Angela
retaining wall is built with borrow pit material Oblasser, Antonio Videka, Carmen

critical technological
and is waterproofed from the top down the inner Gloria Dueñas, Carolina Soto,
bank. Meanwhile, the retaining wall of a tailings Constantino Suazo, Cristian Cifuentes,
dam is built with the coarser part of the tailings). Enrique Román, Felipe Mujica, Gerard
Van Lookeren, Grecia Pérez de Arce,

challenges for the


The fine solids settle in the reservoirs and a clear Gullibert Novoa, Gustavo Tapia, Hernán
water lagoon is formed on the surface (National Cifuentes, Jacques Wiertz, Juan
Geological and Mining Service [Sernageomin], 2013. Carlos Alarcón, Juanita Galaz, Julio
Echevarría, Luis Felipe Mujica, Juan

industry’s evolution
Rayo, Marcelo Capone, Miguel Herrera,
Patricio Renner, Raúl Espinace,
Rodolfo Camacho, Ronald Álvarez,
Rosana Brantes, Sebastian Valerio,
Sergio Barrera, Timothy Gardner,
Ulrike Broschek and Waldo Vivallo.

The following team from Fundación


Chile was in charge of drafting this
section: Francisco Klima, Tomás
González, Enrique Molina, Philip Wood,
Cristóbal Arteaga, Manuel Arre, Nicole
Valdebenito y Hernán Araneda.

alta ley Mining technology roadmap 2035 / 145


05 GRAVITATING CORE CHALLENGES

Figure/19 GRAPH/30
Composition of a tailings dam Relationship between ore treated
and the fine copper contained in
the concentrate that is produced
Reservoir 16 1.600
14 1.400
Beach 12 1.200
Clear Water
10 1.000

Mt Cu fine

Mt of ore
8 800
Retaining wall 6 600

Settled fine solids 4 400


2 200
0 0
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Source: Sernageomin (2013) Maximun production of Cu in concentrators (Mt Cu fine)


maximun proccessing concentrators (Mt of ore)

Source: Cochilco (2014d)


Due to declining ore grades in mines that are currently The following graph presents a projection
operating, and which are part of the mining firms’ through 2025 of the relationship between the
development project portfolio, greater efforts must material treated and the fine copper contained This scenario poses a tremendous challenge for Though no major incidents have been
be made to extract increasing volumes of material in the concentrate that is produced. The 5.7% the Chilean mining industry. Tailings are currently reported in our country over recent times,
to maintain production levels or to grow in line with annual increase in fine copper contained a major source of conflict between companies recent international experience has shown
market demand, which will result in a proportional in concentrates means that treatment of and communities: 47% of the tailings produced that one of the main risks associated with
increase in the amount of waste that must be disposed the ore must grow at a rate of 8% annually, in the country have complaints against them or tailings dams has to do with the breaching
of, either as sterile material or in the form of tailings.
increasing from 549 million tons of ore treated some sort of conflict with the population (JRI, of containment walls and the consequential
in 2013 to 1.389 billion tons in 2025 (Cochilco, 2015), which presents a significant challenge that flooding of neighboring areas.
It is estimated that there could be an almost twofold 2014d). That is, the Chilean mining industry must be addressed with the participation of all
increase in the production of tailings by 2035: if today will have to extract, transport, and process stakeholders (mining companies, communities and These events can happen as a consequence of
2.1 million tonnes of tailings are dumped every 36 increasing volumes of ore, which will have a public sector) to make progress in materializing seismic or extreme climatological events and pose
hours, in 20 years we will do the same in just 21 hours. direct impact on the production of tailings. the vision presented in this document. a significant risk to neighboring communities. In

146 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 147
05 GRAVITATING CORE CHALLENGES

Table/7
Recent incidents associated
with tailings deposits dumps

date location company date location company

21/NOV/2015 Hpakant, Kachin state, Myanmar No information Huayuan country, Xiangxi Autonomus -
14/MAY/2009
Prefecture, Hunan province, China
Germano mine, Bento Rodrigues, distrito de
5/NOV/2015 Samarco MineraÇão S.A. 22/DIC/2008 Kingston fossil plant, Harriman, Tennessee, USA Tennsesse Valley Authority
Mariana, Região Central, Minas Gerais, Brazil

10/SEP/2014 Herculano mine, Itabirito, Região central, Minas Gerais, Brazil Hercules MineraÇão Ltda. 8/SEP/2008 Taoshi, Linfen City, Xiangfen county, Shanxi province, China Tashan mining company

7/AUG/2014 Buenavista del cobre mine, Cananea, Sonora, Mexico Southern Copper Corp. Mineração Rio Pomba
10/JAN/2007 Miraí, Minas Gerais, Brazil
Cataguases Ltda

4/AUG/2014 Mount Polley mine, near Likely, British Columbia, Canadá Imperial Metals Corp 6/NOV/2006 Nchanga, Chingola, Zambia plc (KCM) Konkola Copper Mines

Zageur Copper Molybdenum Combine, Zhen’an county Gold


15/NOV/2013 Cronimet Mining AG 30/APR/2006 Miliang Zhen’an county, Shangluo, Shaanxi Province, China
Kajaran Synuik Province, Armenia Mining Co. Ltd
Obed Mountain Coal Mine, northeast
31/OCT/2013 Sherrit International 14/APR/2005 Bangs Lake, Jackson Country, Mississippi, USA Mississippi Phosphates Corp
of Hinton, Alberta, Canada

17/DIC/2012 Former Gullbridge mine site, Newfoundland, Canada No information Source: Word Information Service on Energy (2016)

4/NOV/2012 Sotkamo, Kainuu Province, Finland Talvivara Mining Company PLC

Xichun Minjiang Electrolytic


21/JUL/2011 Mianyang City, Songpan Country, Sichuan Province, China
Mangenase Plant

4/OCT/2010 Kolontár, Hungría MAL Magyar Alumínium

25/JUN/2010 Huancavelica, Peru Unidad Minera Caudalosa Chica

Karamken Minerals
29/AUG/2009 Karemken, Magadan región, Russia
Processing Plant

continue on next page

148 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 149
05 GRAVITATING CORE CHALLENGES

addition, leakage from tailings dumps, active and Figure/20


inactive, has gained importance in environmental Future mining resources
impact assessment processes. They pose a
long term challenge for mining operations, as in the Central Region
La Serena
they can cause an impact many years after
the deposition of tailings. Deficient control and Over 50% of the country’s future copper resources Carmen de
andacollo
mitigation of leakage can have negative effects are currently found in Chile’s central region, from COQUIMBO
region
on public health and people’s quality of life, the Coquimbo Region to the O’Higgins Region.
polluting water bodies and soils, and causing
negative impacts on other economic activities Operations Los pelambres
such as agriculture and livestock farming.

Another important issue to be highlighted has


to do with the irregular closure of tailings dams, El Soldado VALPARAISO
region
which poses a risk of pollution to watersheds, Changres
Andina
rivers, lakes and coastal areas from leakage; a Valparaiso
risk that the facilities could collapse; particulate Los Bronces
matter emissions, aesthetic and landscape
alterations, and acid drainage, among others. Santiago
Florida METROPOLITANA
of SANTIAGO
region
Lastly, the increasing scarcity of water and space
must be considered, critical matters when the Rancagua
El Teniente LIBERTADOR
projected increase in tailings is considered. GENERAL BERNARDO
O’HIGGINS region
In fact, in the future a significant proportion
of mining production will take place in the
central region, where the population density is
higher and where there is more competition Source: Scenario Planning Initiative (2014)
over the use of land and water resources.

150 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 151
05 GRAVITATING CORE CHALLENGES

In the face of this reality, the state has defined an Despite the fact that progress has been made Figure/21
institutional framework and adopted a series of rules with the regulatory framework to protect
aimed at regulating this activity, especially with regard people and the environment, pending issues
Status of tailings dumps
to the risks associated with the management of tailings. remain that must be addressed together with in Chile by region
The main regulations governing mine waste dumps are: the authorities, such as leakage, for example.

· Supreme Decree (SD) 248, which regulates The expected growth in production, together with
the design, construction, operation a scarcity of land for deposition and doubts they active non active abandoned n/i
and closure of tailings dumps. produce in the community, suggest the need to
review current deposition procedures, evaluate I Region
1 6
· SD 132, Mine Safety Regulation, which the design methodology for new dumps and
establishes the general regulatory seek alternatives to mitigate the impact that
framework that National Mining Extractive could be caused by dams currently in operation. II Region
12 23 20
Industry operations must comply with.
REGISTRY OF TAILINGS DUMPS IN CHILE
· Law 19,300 on General Environmental Regulations. Sernageomin regularly updates its registry of III Region
37 96 11 24
Organic Law of the Environment Superintendence. the tailings dumps in the country. According
to that information, there were 718 tailings
· Law 20,819, enacted in early 2015 to amend Law dumps throughout the country in 2015, of IV Region
36 243 68 8
20,551, regulating the closure of mine operations which 119 are active, 443 are inactive, 124 are
and facilities and introducing other legal changes. abandoned, and 32 are lacking information.
V Region
The following figure shows the status of 20 12
· Law 3,525, Organic Law of the Sernageomin the dumps registered and their distribution 51
(National Geological and Mining Service). in the different regions of the country.
MR
7 12 7

VI Region
2 14

VII Region
1 1

XI Region
2 3

XV Region
1
Source: Sernageomin (2015)

152 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 153
05 GRAVITATING CORE CHALLENGES

The registry establishes the existence of 124 For their part, the Atacama and the Coquimbo The main tailings-producing mine operations
dumps classified as abandoned, a condition Regions concentrate the largest number of are those belonging to the large-scale mining
to classify all dumps with no known owner or active dumps, with 37 and 36, respectively. The category. The remaining tailings are produced
certificate of origin, or where there is official Valparaiso and the Antofagasta regions trail far by medium and small scale mines. Codelco is
or reliable information to indicate that no behind, with 20 and 12 dumps, respectively. the main producer with 28% of the total tailings
closure measures were taken. This situation produced in the country. It is followed by the
forces the state to take responsibility for Of the total number of active dumps, 63 are for company Antofagasta Minerals (AMSA) with
evaluating the structural risk and leakage copper mine tailings. However, when dumps whose 16% and BHP Billiton with 13% (JRI, 2015).
of polluted water, in addition to the means source ore includes copper and another mineral
for capturing and neutralizing them. are considered, this number increases to 87. Current production of tailings is concentrated
mainly in the northern regions, with 62% of
the total. The central region produces 37% of
mine tailings, while production of tailings in the
southern region is practically nonexistent (1%).

GRAPHIC/31 The main tailings producing mine operations in


northern Chile are Escondida, Chuquicamata,
Tailings dams according 7%
1% 1% Collahuasi, Caserones, Centinela, Candelaria, Ministro
to metal produced 2%
2% Hales and Salvador. Regarding central Chile, the main
tailings producing operations are Los Pelambres,
7% El Teniente, Andina, Los Bronces and El Soldado.
Cu
Au
The largest operational tailings dumps in Chile are
Cu, Au
El Mauro, Minera Los Pelambres; Las Tortolas, Los
Fe 66%
14% Bronces; Talabre, Chuquicamata and Minstro Hales,
Mo
Pampa Pabellón, Collahuasi,and Ovejería de Andina;
Zn
Carén, El Teniente; and Laguna Seca, Escondida.
Ca
Cu, Mo

VISION OF CORE CHALLENGE


“To attain global technological leadership
that, when applied to the design, operation,
and environmental closure of tailings dumps,
Source: Sernageomin (2015)
facilitates obtaining the social license to operate
and ensures the mining industry’s development.”

154 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 155
05 GRAVITATING CORE CHALLENGES

CHALLENGES, SOLUTIONS AND R&D LINES table/8


The group of experts that participated in the
technical workshops defined four challenges,
Solutions and R&D Lines. Challenge:
based on the background information evaluated dealing with the increasing
and the vision established for the Core
Challenge: Tailings. Potential solutions and
scarcity of water and space
R&D lines were identified for each of these.

Challenge No. 1: Dealing with increasing SOLUTION R&D & i Line


shortages in water and space.
The mining industry has gradually reduced its Improving and developing cost-efficient methods for separating
water consumption, thanks to technologies that solids from liquids on a large scale: filtering, HD thickeners.
have allowed the deposition of thickened tailings,
in paste and filtered. However, this has not been Development of different compacting methods to increase dump
implemented in a cross-cutting way throughout Efficient and high-capacity separation capacity: electro-separation, agitation, parcellation, others.
the industry, as additional conditions are required of solids from liquids
for this type of application to be implemented
Tailings transportation: rheology modifiers, others.
on a larger scale. Furthermore, in addition to
the intensive water consumption by the copper
concentrate line of production using sulfide Improvement/conversion of conventional deposition
ores, the gradual exhaustion of oxide resources methods into new deposition methods for existing dams.
and their replacement with sulfides will cause
a significant increase in water consumption Improvement and development of operational, physical, chemical
for this purpose. Currently net freshwater Minimize evaporation.
or biological methods to reduce evaporation from dump.
consumption by copper mining is between 0.5
and 0.7 cubic meters per tonne of ore processed,
with evaporation and water retention in tailings Water recirculation Development of new pumping systems.
dams the main reasons behind said consumption.
Development of technologies to facilitate
In addition, the lack of space and the conflicts it Optimal operational management.
parcellation of central lagoon, among others.
produces means there is a need for new technologies
and methods to be developed that could in the future Use of seawater or lower quality water
allow the mining industry to do without tailings. for flotation process and its impact on Effects of seawater on dump’s operation and
transportation, both of water as well as stability in short-, medium- and long terms.
tailings, and for the management of dumps.

continue on next page

156 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 157
05 GRAVITATING CORE CHALLENGES

Challenge No. 2: Minimizing the impact of


SOLUTION R&D & I Line
leakage and ensuring the stability of dumps.
Development and improvement of new methods
Leakage, and its impact on the environment
Dry processes for mineral recovery. and people, represents an ongoing challenge
or dry processes for mineral recovery.
for operating tailings dumps and the future
Prediction and monitoring of the socio- Development and improvement of new methods sustainability of the mining business. In this sense,
environmental footprint of tailings for predicting and monitoring of the socio- developing and improving technologies that can
dumps (Mining Footprint type). environmental footprint of a tailings dump. neutralize the tailings before their deposition is
indispensable, as is characterizing deposition
Development and improvement of methods sites and sealing them to prevent any contact
Management of water resources based on
for managing water resources based on their with surface waters. As a complement, existing
their availability and use on a watershed level.
availability and use on a watershed level. legislation needs to be strengthened to ensure that
Improvement and development of compacting technologies future tailings dumps are designed and operated
like electro-separation, agitation, parcellation, vibration under the “zero effective discharge” concept.
Comparison of sands and crushed ores.
and others to increase the amount of water recovered
from the dump and to expand its capacity. The physical stability of dumps is a critical
issue. A recent review of catastrophic failings
Mining without tailings dumps. Development of new methods that do without tailings dumps. at major tailings dumps internationally reveals
that the flaws correspond to overtopping
(erosion), instability in walls and the impact of
a major earthquake. These flaws are normally
Source: created by authors.
caused by a combination of things, among
which defective design and construction, lax
control in operation and mistaken calculation
of natural events, among others, stand out.

Lastly, the geochemical stability of dumps is


normally associated with the potential production
of acid through a chemical reaction in the tailings
with water and atmospheric oxygen. In this
context, a distinction must be made between
dumps that are abandoned, in operation, and those
which are to be built in the future, so strategies
can be created to adequately control and/or
neutralize each of the aforementioned situations.

158 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 159
05 GRAVITATING CORE CHALLENGES

TABLE/9
Solutions and R&D Lines. Challenge:
Minimizing the impact of leakage and
ensuring the stability of dumps.

SOLUTION R&D & i LINES

Improvement and development of passive,


active and combined methods.
Zero discharge through capture and Technologies to avoid the occurrence of post-closure
treatment of leakage and contact waters. leakage, including the management of surface waters
and their interaction with the dump, in addition to
the waterproofing (coating or sealing) of dumps.
Improvement and development of low-cost, simple, efficient
Treatment and neutralization of
and scalable technologies for the treatment (neutralization)
tailings for deposition.
of tailings prior to deposition (pyrite, arsenic, others).
Development of technologies for waterproofing the base of
Waterproofing of future dumps.
future deposits, such as bio-sealing, polymers, among others.
Improvement and development of low-cost technologies
Localization and monitoring of leakage.
for the localization and monitoring of leakage.
New techniques for characterizing Improvement and development of low-cost

Photograph: Codelco (Los Leones Tailings Dam, Andina)


deposition sites. technologies for characterizing sites.
Improvement of existing technologies, such as phyto-
stabilizers, suppressors, soil bio-feeders, granular covers,
Control of particulate matter. bio-sealing, among others. Improvement and development
of predictive models. Development of plotters.
Development of new control technologies.
Improvement and development of new
Sealing of tailings dump
technologies for sealing tailings dumps

Source: created by authors.

160 / Hoja de ruta tecnológica de la minería chilena 2035 Alta ley


05 GRAVITATING CORE CHALLENGES

Challenge No. 3: Promote conversion TABLe/10


of a liability into an asset
The concept of an Environmental Liability (EL)
Solutions and R&D Lines:
can be interpreted as abandoned or paralyzed promoting conversion from
mine operations, including their wastes, posing
a significant risk to life, public health or the
a liability to an asset.
environment (Sernageomin, 2008). Abandoned or
paralyzed tailings dumps fit with this definition.
SOLUTION R&D & i Line
The conversion of tailings dumps into assets is
aimed at using the tailings, or part of them, as a
Develop industrial uses for tailings.
source of value. While the recovery of elements Investigate industrial
of commercial value constitutes a contribution, uses for tailings.
Waterproofing and filling of mine excavations.
it does not fully resolve the problem. Alternative
uses need to be found that involve a significant
Improvement and development of low-cost technologies for
proportion of tailings produced and to just those
characterizing tailings for the recovery of valuable elements.
elements like copper, gold, molybdenum, iron
or others that might be present and subjected
Improvement and development of sampling
to reprocessing. The adequate management
Recovery of valuable techniques to achieve high recovery level.
of environmental liabilities would directly
elements
benefit communities and contribute to the
Analytical progression: rare earths, other elements of interest.
future sustainability of the mining industry.
Development and improvement of technologies
for recovering elements of interest.

Use of dump surface


Industrial, recreational purposes.
for other purposes.

Source: created by authors.

162 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 163
05 GRAVITATING CORE CHALLENGES

Challenge No. 4: Fostering community


inclusion and acceptance
As has already been noted, a significant proportion to clear and understandable information on
of currently operating tailings dumps have neighboring tailings dumps, a matter that
difficulties with neighboring communities, which can be addressed by developing special
is translated into complaints addressed to the technologies for this purpose. As a complement,
anchorites and legal action taken by the population. the creation of spaces for participation must
be fostered to involve communities and
Resolving this challenge requires fulfilling the effectively communicate the progress made
basic condition of giving communities access in the handling and treatment of tailings.

TABLE/11
Solutions and R&D Lines. Challenge:
fostering community
inclusion and acceptance.

SOLUTION R&D & I Line

Definition of safe standards for implementing local/operational networks

Real-time registration and Development of operator-community-process communications interface.


communication of variables
critical to the dump and its vicinity.
Improvement and development of phenomenological models.

Development of sensors for online monitoring of critical variables.


Photograph: Codelco (Mine Pit, Andina)
Energy generation from tailings transportation.
Development of shared-
value products.
Waters for different uses as a function of their quality.

Source: created by authors.

164 / Mining technology roadmap 2035 Alta ley


CORE CHALLENGE
TAILINGS RESOURCES

4
INFRASTRUCTURE
· Fiber optic networks for telecommunications

challenges LEGAL INSTITUTIONAL


· Promote R&D&i ecosystem
· Personnel Development Policy
· Regulation to take responsibility for leakages
(non-circumstantial sources) and contact waters.
· Decisions on existing liabilities.
· Promoting reprocessing of tailings in operation.

22
CAPACITIES
· Specialized human resources for inspecting

solutions dumps.
· Specialized human resources for operating
dumps.
· Specialized human resources for R&D

SUPPLIERS
· Strengthen local suppliers in instrumentation/

37
representation.

R&D & i Line


ALLIANCES
· Alliances Projects FIE Codelco, AMSA and Enami
· Alliances between industries and Technical
Training Centers, training of operators
· Alliances between research centers, Universities,
Industries, State, Suppliers.
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/1
Technology Watch: Tailings (Patents)

TOTAL PATENTS Patent Year Citations COUNTRIES WITH MOST PATENTS


2010-2015

70
Patent Year Citations
US8137566B2
2012 22
Recovery of tailings ponds 3 Canada 19
US8859090B2 USA 18
Micro-structured surface having 2014 4 2
tailored wetting properties 19 13 Germany 13
7
US7682582B2 7 Japan 7
Simultaneous removal of H2S 2010 4 18 1 1 7
and SO2 from tail gases France 7
KR101315807B1 China 7
Production of Refuse Derived Fuel and
2013 3

PATENTS
Treatment of Biomass with zero discharge Denmark 3
system Using Microbial Materials
Holland 2
CA2750934C
Parafinic froth treatment with tailings Switzerland 1
2012 3
solvent recovery having internal flowrate Greece 1
inhibiting asphaltene mats
US8197676B2
2012 3
Method for tailings solvent recovery

MAIN TECHNOLOGICAL FR2937257A1


Methode of construction applicable aux 2010 2
MAIN · Basf AG
TRENDS adsorbeurs radiaux de grosse taille COMPANIES · Suncor Energy INC
· Kurita Water IND LTD
- Destruction or transformation
US9068245B2
2015 1 AND/OR R&D · Smith & Co AS F L
Process for the recovery of gold from anode slimes
of solid wastes CENTERS · Changchun Gold Res INST
- Flow mixers CN102267751B
Rapid precipitation and concentration 2013 1
MAIN · Du Pont
- Sludge treatment tank for tailing sewage UNIVERSITIES · Fort Hills Energy LP
- Devices for the above · Nippon Sodaco
- Water treatment EP1676478B1 University of Freiberg · Total E&P Canada LTD.
2011 1
Slime remover and slime preventing/removing agent
- Nature of the pollutant University of Nankín · Chinanat Gold Group Corp Technology CT

168 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 169
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/2 MAIN RESEARCH INSTITUTIONS N°


Technology Watch: Tailings University of Vigo 8
(Publications) Chinese Academy of Science 7
University of Arizona 7
SCIENTIFIC PUBLICATIONS SCIENTIFIC University of Chongqing 6

69
2010-2015 PUBLICATIONS University of Anhui 5
17 Sun Yat-sen University 4
15
12 2014
Canadian Department of Agriculture and Agri-food 3

9 2013 10 Universidad Técnica Federico Santa María 3


2012
University of Belgrade 3
2015
2010 6 AGH Science and Technology University 2

2011

COUNTRIES WITH SCIENTIFIC PUBLICATIONS


MAIN RESEARCH TRENDS N°
Ecology and Environmental Science 22
Engineering 14 China 23
Geology 9 MOST-CITED 3
5 Spain 9
Ore processing 9 PUBLICATION 9 3
USA 9
9 23 Chile 6
Agriculture 8
Hydraulic conductivity of
3 Poland 5
Geochemistry and Geophysics 6 geosynthetic clay liners to
tailings impoundment solutions 2 2
Canada 3
Materials Sciences 6
Iran 3
Water Resources 6 Authors
Shackelford, Charles D Serbia 3
Applied Biotechnology and Microbiology 5 Sevick, Gerald W Bangladesh 2
Eykholt, Gerald R. 6
Chemistry 5 Saudi Arabia2

170 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 171
05 GRAVITATING CORE CHALLENGES

CORE CHALLENGE: SMELTING and supplies, all of these with a high


AND REFINING fixed cost component. Smelters
BACKGROUND “charge” the companies that produce
Smelting is the pyrometallurgical concentrate according to the following
treatment of copper concentrate. The mechanisms (Parra, 2011):
purpose is to separate the mineral
from other substances contained in The section Core Challenge · Treatment Charges (TC): Corresponds
the concentrates, of which iron and Smelting and Refining was drafted to the cost of smelting the concentrate,
sulfur are the most abundant. This is based on work by the technical which is charged based on the
achieved in successive stages through commission created for the core tonnage of concentrate to be treated.
which blister copper, copper anodes challenge, which was comprised · Refining Charges (RC): Charged based
or FR (Fire-refined) copper can be of the following members: on pounds of copper “refined.”
produced. These products differ from Alejandro Dagnino, Andrés Secco, · Price Sharing (PS): Used in
copper cathodes because they contain Antonio Luraschi, Benjamin Martinich, replacement of TC and RC, it
a higher proportion of impurities, which Carolina Águila, Cristián Martínez, corresponds to a percentage
can be eliminated in a subsequent Daniel Smith, Domingo Fuenzalida, of the sales price.
stage, known as electrolytic refining. Emilio Castillo, Enrique Roman, · Price Participation (PP): Corresponds
Fernando Hernández, Francisca to the commercial cost paid/charged
Electrolytic Refining is an Domínguez, Froilán Vergara, Gabriel complementary to TC and RC,
electrochemical process aimed at Riveros, Gerardo Cifuentes, German equivalent to a percentage of the sales
“refining” the anodic copper obtained Richter, Ignacio Moreno, Igor price of fine copper when it surpasses
from smelting to produce high-purity Wilkomirsky, Jonathan Castillo, Jorge a base value (normally 10%).
copper cathodes, which are then sold. Cantallopts, Jorge Zuñiga Aguirre,
José Urrutia, Juan Carlos Torres, TCs are mainly defined in two ways:
Smelting and refining is considered Leandro Voisin, Leonel Contreras, Luis
a business with tight margins, in Felipe Mujica, Manuel Cabrera, Marco 1. Setting the price in long-term contracts
which revenues mainly come from Rosales, Orlando Rojas, Pedro Reyes, between smelters and the companies
treatment and refining charges, TC/ Rene Bustamante, Ricardo Bonifaz, that produce concentrate, which allows
RC, the sale of sulfuric acid, location Ricardo Parada, Roberto Parra, the former to ensure the supplies
factors (freight savings, or Freight Rodrigo Abel, Victor Garay Lucero, needed to operate. This has prompted
Allowance), penalizations for the quality Victor Paredes, Yanko Gonzalez. smelters to invest in the development
of concentrate and anodes and bonuses and operation of mining projects,
from the recovery of valuable metals, This section was drafted thanks thus gaining greater control over the
the majority of these being variable. to contributions from Cristóbal fate of the concentrate produced.
Arteaga, Enrique Molina, Francisco
For their part, the most significant Klima, Manuel Arre, Philip 2. Through spot loads, where
costs are associated with energy Wood and Tomás González. charges for treatment and refining
(mainly electricity), labor, maintenance are defined “load by load.”

172 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 173
05 GRAVITATING CORE CHALLENGES

China has currently become the leading consists in gangue or material without 14
Corresponds
actor in copper smelter production, with commercial value (Cochilco, 2015d). to fine copper
over 5 million tonnes of fine copper On top of the scenario described, content in bulk,
per year, followed very far behind by where significant concentration in the of which copper
Chile and Japan with approximately smelting and refining business can concentrates
are almost
1.5 million each (Cochilco, 20153), thus be observed, the sale of copper could 100% of Chilean
gaining a predominant position in the face difficulties due to the impurities it exports.
determination of treatment charges (TC). contains, which could be catalogued as
hazardous or even cancerous materials.
This is of particular relevance when one
considers that China is the main destination This would be translated into discounts in
for copper concentrate produced in Chile. the sales price associated with the cleaning
of ships, in addition to treatment costs.
Close to one third of exports are
sent to that country, for a total Eventually, smelters could even reject
of 887,000 tonnes of fine copper “complex” concentrates like those with
(content)14 in 2014 (Cochilco 2015f). high arsenic contents, which account
for a significant proportion of Chilean
China is expected to attain a share of production, in that way reducing
close to 60% of the global concentrates the possibilities for selling them.
market, which would translate into
even greater power to determine For our country, which currently exports
prices (TC/RC, penalizations, PP, 2.5 million tons of copper as cathodes
others), exposing the Chilean mining (both refined as well as electrowon) and
industry to a high-risk scenario. 2.7 million tons in concentrates (Cochilco
2015g), it is fundamental to anticipate
In addition to this, it must be noted the risks associated with concentrate
that the future trend Chilean copper markets and, based on that, strengthen
production is increasingly inclined toward its position in the cathodes market.
a majority production of concentrates,
thanks to the gradual exhaustion However, the current situation in
of copper oxide deposits. This will Chilean smelters and refineries poses
Photograph: Codelco (Copper anodes)
impose major challenges in terms of significant challenges that must be
the infrastructure for transporting this overcome to foster the development
product, a significant portion of which of the national mining industry.

174 / Mining technology roadmap 2035 Alta ley


05 GRAVITATING CORE CHALLENGES

CURRENT SITUATION IN CHILEAN Smelters’ performance can be evaluated operations (in the case of Potrerillos,
SMELTERS AND REFINERIES as a function of direct operating costs, Chagres, Paipote and Ventanas, with
15
Gross Margin
is an economic
revenues and the level of capture and fusion levels of between 340,000 parameter
There are currently seven copper smelters in three decades. Fusion capacity using Flash sequestering of metallurgical gases. and 720,000 KTPA of concentrate). that to a great
Chile: five are state-owned (Caletones, Potrerillos, Furnace technology for fusion of concentrates Chilean smelters are in an unfavorable degree reflects
Hernán Videla Lira, Chuquicamata and Ventanas) accounts for 25% of total national capacity position with regard to other global When the gross margin is analyzed15, a business’s
competitiveness
and two are private (Chagres and Altonorte). (Chuquicamata Flash Furnace and Chagres actors in all of these categories, which the numbers indicate that of the seven and is defined as
They use the technologies Flash (flame fusion), smelter). The remaining 75% of national smelting is explained by low revenues and high smelters, four are in the last decile Total Revenues
Teniente Converter (TC) and Noranda Converter capacity, including the TC in Chuquicamata, labor and energy costs. Low levels of in terms of global competitiveness minus Net Cash
Cost. (Excludes
(NC) (bath fusion) for the fusion of concentrates, operate with TC or Noranda technology. metallurgical recovery also have an in the business and register negative
localization
in both cases with Pierce Smith converters, a impact, as they reduce Bonus Metal margins. In the case of refineries factor, as it
situation that has remained unchanged for almost This is detailed in the following graph. revenues. In addition to this is the the situation is even worse, as all of does not come
obsolescence and small scale of the them (3) have negative margins. from efficiency
factors, but
rather from the
specific location)

GRAPH/32
Capacities and technologies 11% 11%

of Chilean smelters
14%
TABLE/12
Total capacity of 7 national smelters:
6,470 KTPA concentrate.
Smelter Gross Margin
22%
Fusion technology of national
smelters: 75% Teniente-Converter 5%
Noranda, 25% Flash Furnace. Smelters Direct Cost Total revenues Cash Margin

7%
Caletones Average (c/lb Cu) Average (c/lb Cu) Average (c/lb Cu)
Altonorte
Chuqui-Flash 19% 11% China 12,9 28,6 19,3
Chuqui-CT
Potrerillos-CT World 23,5 27,0 12,2
Chagres- Flash
Ventanas-CT Chile 39,9 22,3 -4,6
Paipote-CT Source: Amec Foster Wheeler (2015)

Source: Study “State of the Art and Vision of Future in Smelting-Refining,” Alta Ley Program, August 2015.

176 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 177
05 GRAVITATING CORE CHALLENGES

TABLE/13 On top of the low level of competitiveness and 6.6% of global production of
that Chilean smelters show, there is electro-refined copper cathodes
16
S.D. No. 28,
Gross Margin Refineries also the determination of new limits for (Amec Foster Wheeler, 2015).
published in the
Official Gazette
sulfur emissions (sulfur dioxide, SO2, With 1.3 billion tons of anodes on 12 December
and arsenic, As)16, a standard that was produced per year, Chile could use 2013.
REFINERIES DIRECT COST TOTAL REVENUES CASH MARGIN implemented on OECD recommendations 100% of its refineries’ capacity, which
that regulations be drafted to totals 1.12 billion tons of cathodes.
Average (c/lb Cu) Average (c/lb Cu) Average (c/lb Cu) reduce SO2 and toxic pollutants.
The electrodeposition technologies
China 4,33 12,13 7,80 In the case of existing smelters, the currently in use are:
regulation establishes a freeze on SO2 · Permanent cathode
World 6,09 10,16 4,07 emissions and imposes maximum SO2 · Starter sheets
emissions (in tons per year) and 95%
Chile 14,53 6,86 -7,67 capture and sequestration, setting a On average, permanent cathode
five-year deadline for compliance. A technology uses denser current than
more demanding emissions limit is starter sheets (278 and 260 A/m2,
Source: Study “State of the Art and Vision of Future in Smelting-Refining,” Alta Ley Program, August 2015. established for new smelters, equivalent respectively). Efficiency of electrical
to the capture of 98% of SO2 and current is an important operational
99.976% of As emissions. In addition, parameter and, as can be seen in
they must capture and sequester graphs 33 and 34, no correlation can
95% or more of sulfur and arsenic. be observed between the current
density used and the current efficiency.
Chilean refineries (Chuquicamata, That is, there are no major differences
Potrerillos and Ventanas) contribute in the average current efficiency
6.8% of global installed capacity values for each of the technologies.

178 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 179
05 GRAVITATING CORE CHALLENGES

GRAPH/33 GRAPH/34
Electrodeposition technology Electrodeposition technology
(permanent cathodes) (starter sheets)
Avg. current density: 278 A/m2 Avg. current density: 260 A/m2
Avg. current efficiency: 95% Avg. current efficiency: 95.3%

400 100% 400 100%


360 98% 360 98%
320 96% 320 96%
Current density (A/m2)

280 64%

Current density (A/m2)


280 64%

Current efficiency

Current efficiency
240 92% 240 92%
200 90% 200 90%
160 88% 160 88%
120 86% 86%
120
80 84% 84%
80
40 82% 40 82%
0 80% 0 80%
Onahama
Garfield
Chuquicamata
Montreal East
Nihama
Jinlong
La Caridad
Shandong Xiangguang
Gresik
Nkana
Guixi
Saganoseki
Dahej
Mufulira
Olympic Dam
Townsville
Tamaño
Tuticorin
Luenen
Olen
Onsan
Huelva
Brixlegg
Hamburg
Ronnskar

Onahama
Glogow I
Glogow II
Mufulira
Bor
Nkana
Amarillo
Potrerillos
Legnica
Kosaka
Naoshima
Shanghai
Baiyin
Guixi
Jinchuan
Yantai Penghui
Toyo
Ilo
Jinchun
Daye
Pirdop
El Paso
Palabora
Dias d’Avila
Daye

Saganoseki
Jinlong
Jinchang
Pasar
Jinchang
Ventanas
Tamano
Pori
Hitachi
Current density Current efficiency Current density Current efficiency

Source: Amec Foster Wheeler (2015) Source: Amec Foster Wheeler (2015)

180 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 181
05 GRAVITATING CORE CHALLENGES

However, when productivity is analyzed one GRAPH/36


can see that permanent cathode technology is
far superior when compared to starter sheets
Refining technology versus
(see graphs 35 and 36), though, it is important productivity (HH/t cath)
to highlight that there is a significant number of
modern starter sheet refineries with very strong
(starter sheets)
productivity (mechanization and automation).
Avg. productivity: 4.8W HH/t cath

GRAPH/35 20
Refining technology versus
productivity (Man Hours per 15

HH/t cath
ton of cathode, MH/t cath) 10
(permanent cathode) 5
Avg. productivity: 1.4 MH/t cath
0

Toyo
Hitachi
Pirdop
Pori
Naoshima
El Paso
Jinchuan
Días d’Avila
Glogow II
Pasar
Amarillo
IIo
Glogow I
Pasar
Daye
Kosaka
Ventanas
Legnica
Potreríllos
Jinchang
Palabora
Baiyin
Yantai Penghui
Bor
Shanghai
20

15
HH/t cath

10 Source: Amec Foster Wheeler (2015)

0
Hamburg

Luenen

Ronnskar

Brixlegg

Olen

Onsan

Huelva

Townsville

Gresik

Nihama

Olympic Dam

Garfield

Montreal East

Dahej

Shandong Xiangguang

La Caridad

Chuquicamata

Source: Amec Foster Wheeler (2015)

182 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 183
Chilean refineries in an uncompetitive position: in of sequestration that comply with current
2013 they were in the last decile of the industry and future environmental regulations.
in terms of gross margin, which registered
negative numbers. This is because their costs In particular, we must aspire to all smelters
are higher than those of the rest of the industry possessing an electrolytic refinery, something
(Amec Foster Wheeler, 2015). The year 2013 was normal and desirable worldwide, which
particularly negative for Chilean smelters and would allow the operational synergies
refineries due to very high mining activity, a low (treatment of anode scrap and byproducts)
dollar exchange rate and high electricity costs. to be taken advantage of in a better way
and for savings to be made on shipping.
As the world’s biggest copper producer, Chile
must defend its position in the global market In addition, treatment of anode sludge would be
by selling cathodes. This has its advantages more efficient with just a single noble metals
compared to the sale of concentrate, due to: plant in the country (for economy of scale and
because it is a highly specialized technology),
· Possible restrictions on concentrate something that Codelco has already considered
exports (maritime transport). in the Noble Metals Plant Project in Mejillones.
· Possible increases in treatment
and refining charges due to Asian Inspired in technologies developed in Chile for
smelters’ negotiation power. the Teniente Converter, China has been promoting
· Possible reward from the quality of cathodes, an explosive development of efficient smelting
rather than penalizations and additional technologies that are currently setting global
costs from shipping concentrates. standards because of their cost advantages.
· Additional revenues from the
recovery and sale of valuable metals The northern part of the country (especially the
contained in the concentrates. Antofagasta Region) has a need to deal with
complex concentrates that face restrictions
To make progress in the aforementioned or which cannot be exported, especially if
Photograph Max Donoso (Chuquicamata Smelter) direction requires lifting existing operations one considers the tremendous volume that
out of the state of technological obsolescence will come from Underground Chuquicamata.
they are in, upgrading and/or replacing This scenario opens up the opportunity to
facilities to make them world-class operations transform smelters into specialized centers
with low operating costs and high levels for the treatment of this type of concentrate.

alta ley Mining technology roadmap 2035 / 185


05 GRAVITATING CORE CHALLENGES

CHALLENGES, SOLUTIONS AND R&D LINES TABLE/14


VISION OF CORE CHALLENGE The group of experts that participated in the
“To attain global technological leadership that, technical workshops defined four challenges,
Productivity gaps of
when applied to the industrial design and based on the background information Chilean smelters
operation, facilitates obtaining the community’s evaluated and the vision established for the
acceptance to operate to high performance Core Challenge: Smelting and Refining. . All of
standards that guarantee an economic margin the solutions identified, with their respective SMELTERS SMELTERS SMELTERS SMELTERS
in the second quartile at a bare minimum.” R&D lines, apply to more than one challenge. PARAMETER UNIT
CHINESE JAPANESE GERMAN CHILEAN
There are cases in which R&D lines are added
in consideration of the challenge at hand. For Fusion capacity KTS/year 1.000-1.500 1.200 1.200 320-1.000
example: the solution “High level of capture
and treatment of complex concentrates” is
pertinent to Challenges 1, 2 and 3. This solution Sulfur sequestered % 98 99 98,5 95
contains three R&D lines for Challenge No. 1,
which a line of R&D is added when the solution
Unit costs cUS$/lb 13 18 19 22-40
is proposed in the context of Challenge No.
2 and two lines of R&D when the solution is
proposed in the context of Challenge No. 3. Copper Recovery % 98-98,5 98-99,5 98 95-97,3

The solutions and R&D lines identified for each


of the challenges presented are detailed below: Energy Recovery Yes/No Yes Yes Yes No

Challenge No. 1: Increasing efficiency other metals Yes/No Yes Yes Yes No
of smelting and refining processes
Chilean smelters show important deficiencies
that can be explained by a low fusion capacity, low
Source: Enami (2015)
copper recovery rates and nonexistent recovery
of byproducts and energy. This, together with
the process’s high unit cost, creates a scenario
in which one of the main challenges is to make
smelters more efficient. The table below compares
the parameters of Chilean smelters with those of
other countries to identify the productivity gaps.

186 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 187
05 GRAVITATING CORE CHALLENGES

TABLE/15
Solutions and R&D Lines. Challenge:
increasing the efficiency of
smelting and refining processes

SOLUTION R&D & i LINE SOLUTION R&D & i LINE


Continuous conversion with solid white metal. Continuous conversion with solid white metal.
Intensive mechanization,
Instrumentation and expert control system for BS furnaces. Instrumentation and expert control system for BS furnaces.
automation, robotization.
Slag cleaning. Automation, mechanization and robotization of refineries.

Minimal loss of copper and Automation, mechanization and robotization of refineries. Continuous conversion with solid white metal.
other metals of value. Valuable metals recovery (Mo, Re, U, Ge). Automation, mechanization and robotization of refineries.
Recovery from smelting dust and anode sludge. Continuous processes. Use of High Pressure Nozzles in bath smelting furnaces.
Use of High Pressure Nozzles in bath smelting furnaces. Direct-to-blister smelting.
Molten layer technology New continual electro-refining process.

High-capacity processing Slag cleaning.


Continuous conversion with solid white metal.
equipment and long campaigns. Recovery of valuable metals (Mo, Re, U, Ge).
Continuous conversion with solid white metal. Minimum waste produced and
Recovery from smelting dust and anode sludges.
other byproducts gained.
Minimum processes and Use of High Pressure Nozzles in bath smelting furnaces. Control of impurities
unit operations. New continual electro-refining process. Control of Sb and Bi in refinery.
Direct-to-blister smelting. Automation, mechanization and robotization of refineries.
Instrumentation and expert control system for BS furnaces. Good labor conditions and
High level of capture and Control of impurities
Advanced Human Capital
treatment of complex Use of High Pressure Nozzles in bath smelting furnaces. Control of Sb and Bi in refinery.
concentrates.
Packed-bed technology
continue on next page
Source: created by authors.

188 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 189
05 GRAVITATING CORE CHALLENGES

Challenge No. 2: Reducing the TABLE /16


environmental impact.
There are significant gaps in terms of sulfur and
Solutions and R&D Lines. Challenge:
arsenic sequestration, which constitutes a major reducing the environmental impact.
environmental challenge for Chilean smelters. The
need to raise the standards of these parameters
to equal those implemented in other countries SOLUTION R&D & i LINE
has resulted in a new regulation (Decree No.
28 of 2013) establishing a new sequestration Continuous conversion with solid white metal.
level of 98% (SO2 and As) for future facilities. Instrumentation and expert control system for BS
furnaces. Recovery of valuable metals (Mo, Re, U, Ge).
Minimal loss of copper and Recovery from smelting dust and anode sludge.
other metals of value. Slag cleaning.
Automation, mechanization and robotization of refineries.
Molten layer technology
Use of High Pressure Nozzles in bath smelting furnaces.
High-capacity processing
Continuous conversion with solid white metal.
equipment and long campaigns.
Instrumentation and expert control system for BS furnaces.
High level of capture and Automation, mechanization and robotization of refineries.
treatment of complex Packed-bed technology
concentrates. Use of High Pressure Nozzles in bath smelting furnaces.
Treatment of high As concentrates in BBF.
Recovery of valuable metals (Mo, Re, U, Ge).
Recovery from smelting dust and anode sludge.
Minimum waste produced and
Slag cleaning.
other byproducts gained.
Control of impurities
Control of Sb and Bi in refineries.
Automation, mechanization and robotization of refineries.
Good labor conditions and
Control of impurities
Advanced Human Capital
Control of Sb and Bi in refineries.

Source: created by authors.

190 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 191
05 GRAVITATING CORE CHALLENGES

Challenge No. 3: Improving labor conditions. TABLE/17


The incorporation of new technologies in smelting Solutions and R&D Lines. Challenge:
and refining processes will not just have an
impact on the aforementioned challenges, improving labor conditions
but will also contribute to improving the labor
conditions for people working at operations.
SOLUTION R&D & i LINE
Manipulation of molten material poses a risk to
the workers involved in the process, meaning Recovery of valuable metals (Mo, Re, U, Ge).
that eliminating the current gap in the accident Recovery from smelting dust and anode sludges.
Minimum processes
rate, mainly explained by the existence of Slag cleaning.
and unit operations.
multiple non-continuous processes in operations, Control of impurities
constitutes a major challenge to be addressed. Control of Sb and Bi in refineries.
Continuous conversion with solid white metal.
Intensive mechanization,
Instrumentation and expert control system for BS furnaces.
automation, robotization.
Automation, mechanization and robotization of refineries.
Instrumentation and expert control system for BS furnaces.
High level of capture and Automation, mechanization and robotization of refineries.
treatment of complex Packed-bed technology
concentrates. Use of High Pressure Nozzles in bath smelting furnaces.
Treatment of high As concentrates in BBF.
Automation, mechanization and robotization of refineries.
Good labor conditions and
Control of impurities
Advanced Human Capital
Control of Sb and Bi in refineries.
Continuous conversion with solid white metal.
Instrumentation and expert control system for BS
furnaces. Recovery of valuable metals (Mo, Re, U, Ge).
Minimal loss of copper and
Recovery from smelting dust and anode sludges. Slag cleaning.
other metals of value.
Automation, mechanization and robotization of refineries.
Molten layer technology
Use of High Pressure Nozzles in bath smelting furnaces.
High-capacity processing
Continuous conversion with solid white metal.
equipment and long campaigns.

Source: created by authors.

192 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 193
CORE CHALLENGE:
SMELTING AND REFINING RESOURCES

3
INFRASTRUCTURE
· Pilot tests (China/Chile)
· Laboratory tests.

CHALLENGES CAPACITIES
· Research in basic sciences.
· Universities contribute to research,
instrumentation and control.
· Advanced human capital with specialty: fluid
dynamics, transport phenomena, reaction
kinetics, thermodynamics, electrochemistry,
materials science, process modeling,

19
optoelectronics, mineral chemistry, digital
technology and mechatronics.
· Training of technical workers in operation and

SOLUTIONS maintenance skills at Technical Training Centers


· Center specialized in arsenic.
· Organization and transparency.
· Technology think tank for mining.
SUPPLIERS
· Strengthen the development of local suppliers of
instrumentation, expert control, mechanization,
automation, robotization, information management,

79
optimization software, data transmission,
engineering design and specialized support services.
· System structured to accompany local

R&D & i LINES companies with technological capacities.

ALLIANCES
· China - Chile cooperation agreement.
· Alliances with national and international
universities and centers of excellence.
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/3 COUNTRIES WITH MOST PATENTS


Technological surveillance
smelting (Patents)

TOTAL PATENTS MOST-CITED PATENTS 10 Japan 24

2010-2015 Patents Year Citations USA 19

119
5 10
EP1148295B1 5 China 14
Gasification melting furnace for wastes 2011 14 14 24 Finland 10
and gasification melting method 19 4
5 Germany 10
US7771666B2
Method of producing nanoparticles using a Taiwan 5
2010 11
evaporation-condensation process with a
reaction chamber plasma reactor system France 5
US8052774B2 Canada 5
Method for concentration of gold 2011 5
in copper sulfide minerals Australia 5

PATENTS EP1811821B1
Method of recycling waste printed circuit boards
EP1964936B1
2011 4 Italy 4

Process for recovering noble metals 2013 4


from electric and electronic wastes
US8173086B2 MAIN COMPANIES
Process of recovery of base 2012 3
metals from oxide ores AND/OR R&D CENTERS
US2010275730A1
Method for recycling precious metal 2010 3
from used printed circuit boards MAIN UNIVERSITIES · Outotec OYJ
· Tanaka Precious Metal IND
US7776135B2 · Central South University, China · Dowa Metals & Mining CO LTD
MAIN Method for the recovery of gold
2010 2
· National Technology Institute of Japan · JX Nippon Mining & Metals Corp
TECHNOLOGICAL US8800775B2 · Beijing University of Science and Technology · Precious Metals Recovery PTY LTD
Method for recovering metals from electronic 2014 2
TRENDS waste containing plastics materials
· Espirito Santo Federal University · Mitsubishi Materials Corp
· Jiangxi University of Science and Technology · Kosaka Smelting & Refining CO
US7815706B2 · Northeastern University of China · Nippon PGM CO LTD
· Mitigation of climate Method and apparatus for recovering 2010 2 · University of Tokyo · Outokumpu OY
platinum group elements
change from production. · University of Utah Research Foundation · Umicore AG & CO KG

196 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 197
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/4 Principales Instituciones de Investigación N°


Technology Watch: Russian Academy of Science 17
Smelting (Publications) University of Belgrade 13
Central South University, China 11
SCIENTIFIC PUBLICATIONS SCIENTIFIC University of Prague 8
2010-2015 PUBLICATIONS Chinese Academy of Science 7

178
Czech Geological Service 6
36 Shahid Bahonar University of Kerman 5

31 2011
35 Minnig and Metallurgy Institute Bor 4

27 28 Polytechnic University of Silesia 4


2015
2010
2013 21 University de Tohoku 4
2012
2014
COUNTRIES WITH SCIENTIFIC PUBLICATIONS
MAIN RESEARCH TRENDS N°
Metallurgy /Metallurgic engineering 63 Czech Rep 33
22
Engineering 51 10 Russia 22
8
8 Serbia 15
Ecology and environmental sciences 49
15 10
Materials sciences 29 MOST-CITED 15 33 USA 15

Ore processing 29 PUBLICATION 9 Japan 10


Poland 10
Mineralogy 24 Low grades ores - Smelt, Australia 9
Chemistry 18 leach or concentrate?
9 Irán 9
Geology 15 Authors: Canada 8
Norgate, T Czech Rep 8
Water resources 10
Jahanshahi, S

198 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 199
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/5
Technology Watch:
Refining (Patents)

TOTAL PATENTS MOST-CITED PATENTS COUNTRIES WITH MOST PATENTS


2010-2015

77
Patents Year Citations Japan 22
US8052774B2 USA 11
Method for concentration of gold 2011 5 4
in copper sulfide minerals Chile 9
4
US7700343B2 3 China 7
Sulfur-oxidizing bacteria and their use in 2010 4 4
bioleaching processes for sulfured copper minerals 2 22 Austria 4
11 7
US8834715B2 Finland 4
2014 4
Copper recovery apparatus and copper recovery method
Poland 4
US2010065433A1
System and apparatus for enhancing Canada 3
convection in electrolytes to achieve improved 2010 4
Australia 2

PATENTS
electrodeposition of copper and other non 2
ferrous metals in industrial electrolytic cells Switzerland 2
EP1903119B1
A method of manufacturing high purity copper
2015 3 9

US7811534B2
2010 3
Method for the treatment of copper-bearing materials
MAIN US8192596B2
Ultrahigh-purity copper and process 2012 3
TECHNOLOGICAL for producing the same MAIN COMPANIES AND/
TRENDS US7736487B2 OR R&D CENTERS
Process for recovery of copper from copper-
2010 3
· Obtaining copper bearing material using pressure leaching,
direct electrowinning and solution extraction
MAIN UNIVERSITIES · JX Nippon Mining & Metals Corp
· Technologies related to · Pan Pacific Copper CO LTDA
US7722756B2
metals processing Process for multiple stage direct 2010 2 · University of Chile · Nippon Mining CO
· Solid waste management electrowinning of copper · Free University of Brussels · Phelps Dodge Corp
technologies US7736488B2 · University of Osaka · Freeport McMoran Corp
· Electrolytic production Process for recovery of copper from copper- · University of San Luis · Outotec OYJ
2010 2
· Recovery and refining of metals bearing material using pressure leaching, direct · University of Santiago de Chile · Xiangguang Copper CO LTDA.
via solutions electrolysis electrowinning and solvent/solution extraction · University of British Colombia · Sumitomo Metal Mining CO

200 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 201
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/5 MAIN RESEARCH INSTITUTIONS N°


Technology Watch: University de Tohoku 6
Refining (Publications) University of Brunei 4
University of Kyushu 4
SCIENTIFIC PUBLICATIONS SCIENTIFIC Russian Academy of Science 4

98
2010-2015 PUBLICATIONS French National Center for Scientific Research 3

23 Academy of Sicences of the Czech Republic 3


18 17 University of Monash 3
2014 15 Northwestern Polytechnical University, USA 3
13 2011
12 2013 University of Lorraine 3
2015
2010
2012

COUNTRIES WITH SCIENTIFIC PUBLICATIONS


Principales tendencias de investigación N° MOST-CITED
Materials sciences 62 PUBLICATION
Metallurgy / Metallurgic engineering 44 The role of stacking faults China 28
and twin boundaries in 8 Japan 12
Other technology-science topics 15 8
grain refinement of a Cu- 5
6 8 Australia 9
Physics 11 Zn alloy processed by
high-pressure torsion 9 28 12 USA 9
Engineering 8
7 UK 8
Chemistry 7 Authors
Wang, Y.B. Russia 8
Crystallography 4 Liao, C.Z. South Korea 7
Mineralogy 3 Zhao, Y.H
9 France 6
Ore processing 3 Canada 5
Microsocopy 2 Czech Rep. 5

202 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 203
05 GRAVITATING CORE CHALLENGES

CORE CHALLENGE; MINE GRAPH/ 37


OPERATIONS AND PLANNING
BACKGROUND
Ore extracted in Chile and
The majority of ore currently extracted in the world, 2000-2030
Chile and around the world comes from open-
pit mines. Over 3 billion tonnes of ore were
extracted worldwide in 2014, of which 87% 6.000.000
came from open-pit mines. Chile concentrated
approximately 30% of that production. 5.000.000

Millones de toneladas
4.000.000

3.000.000
The Core Challenge Mine
Operations and Planning section
was drafted based on work 2.000.000
by the technical commission
created for the core challenge,
which was comprised of the 1.000.000
following members: Agustín
Sepulveda, Andrés Pérez,
0
Brian Baird, Carlos Urenda,
Christian Schnettler, Claudio 2000 2003 2006 2009 2012 2015 2018 2021 2024 2027 2030

Rojas, Cleve Lightfoot, Francisco Open pit mining, rest of the world Open pit mining, Chile
Abbott, Hugo Toro, Jorge Soto, Underground mining, rest of the world Underground mining, Chile
Murray Canfield, Nury Briceño,
Pablo Asiain, Pierre Perrier.
Source: Wood Mackenzie (2015)

The following team from


Fundación Chile was in charge of
drafting this section: Francisco
Klima, Tomás González, Enrique
Molina, Philip Wood, Cristóbal
Arteaga, Manuel Arre, Nicole
Valdebenito, Hernán Araneda.

204 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 205
05 GRAVITATING CORE CHALLENGES

While it has been estimated that there will However, when the ore body is located at TABLE/18
be a significant increase in production from a greater depth or else has surpassed the
underground mines by 2025, open-pit mines economical limit of strip mining, then the
Largest operations in Chile
continue to contribute the largest share of underground method will be chosen. (mainly open-pit) and their
total production, at close to 5 billion tonnes.
In this case the underground method will be defined
contribution of fine copper
The surface exploitation method, known as by a series of factors related to the body shape,
open-pit or strip mining, is the first option other characteristics of the ore as well as the rock KT FINE Cu
evaluated in the development of a mining that surrounds it, environmental and technological
project, as it is usually cheaper if the ore body factors, and economic considerations related to
Operation 2010 2011 2012 2013 2014 % of total % Acum.
is close to the surface and is regular in shape. the ore reserves available, the required production
rate, mine lifespan, productivity, and lastly the
Depending on the concentration of the cost per ton of ore using every possible method. Escondida 1087 818 1076 1194 1165 20 20
elements that are of economic interest, the
potential contaminants and in general the Over 50% of Chile’s fine copper production, in Collahuasi 504 453 282 445 470 8 28
geometry of the ore bodies, open-pit mines any of the forms it is sold in, comes from the
can far exceed 500 meters in depth. six operations detailed in the table below: Anglo American Sur 258 264 417 467 437 8 36

Los Pelambres 398 426 418 419 405 7 43

Chuquicamata Division 528 443 256 339 340 6 49

Radomiro Tomic Division 375 470 428 380 327 6 55

Source: Cochilco (2015f)

206 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 207
05 GRAVITATING CORE CHALLENGES

All of the above operations (Except for Anglo prospecting programs guided by FIGURE/22
American Sur, which includes underground geochemical and geophysical research.
17
Qualification
production from El Soldado) are open-pit In the case of exploration in areas
Commission for Conversion phases and study levels
Skills Related
mines. In the case of Chuquicamata, the covered in pre-ore rocks, exploration to Mining
transition to an underground mine is already must be guided by the extrapolation of Resources
under way and production could begin favorable geological patterns present in and Reserves,
created by Law CONVERSION OF RESOURCES INTO RESERVES
at the end of this decade. Eventually all the pre-ore rocks or by the existence of No. 20,235.
operations could go through this transition. geophysical and geochemical anomalies
(Zauschquevich & Sutulov, 1975). Mineral Resources Mineral Reserves
The main underground operations in
Chile belong to Codelco (El Teniente Estimating the size or tonnage of ore Fragmentary Functional
and Andina Divisions) The El Teniente and the ore grades has habitually been Information Models
Division contributed 8% of the fine copper based on a geological interpretation
produced nationally in 2014, while the or 3-D model of the deposit and geo- High Risk Low Risk
Andina Division accounted for 4% of the statistical processing of the data collected.
total., Both divisions also have open-pit This is used to quantify the Mineral
mines whose production is also included Resources, which after successive
Progressive transition toward reduced uncertainty and risks
in the aforementioned numbers. phases can become Mineral Reserves.

It is estimated that an average of 20 According to the Mining Commitee17,


years pass between the discovery of conversion of Resources into Reserves Exploration Profile Pre-feasibility Feasibility
a deposit and when operation starts. includes the following phases: exploration
The exploration phase lasts an average prospect that gives rise to the idea;
of 10 years, while the study, financing, technical-economic analysis on an order of Source: Tulcanza (2014)
permits and construction phase takes magnitude to produce a study of the scope;
another 10 years (Fuentes, 2010). a pre-feasibility study, and a feasibility
study, which offers a database that is
The majority of large porphyritic copper used by a backer or financial institution
deposits discovered in Chile have been to decide on a project’s development.
the result of a detailed geological analysis
in promising areas, after applying In the early stages information is
metallogenic criteria indicating the fragmentary or insufficient and a high risk
areas that are favorable to exploration, is involved, a factor that diminishes as the
followed by the execution of geological information is improved and strengthened.

208 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 209
05 GRAVITATING CORE CHALLENGES

The successive mining studies must reflect the Mine planning is under continual development mine business’s productivity. Furthermore, the
growing level of certainty in the relevant exploration during mine operation, in a way that is similar need to move larger volumes of waste and grind
parameters and, in the event that favorable to what is done in the preliminary stages of more ore is added to the increasing hardness
economic results are available, lead to the mine’s the mine project or the engineering phase, of the ore found, which also has an impact on
construction, commissioning and operation. but with different information inputs. energy consumption (see chapter 4, Section:
“Current Scenario and Short Term Challenges”)
Operating a mine is a multidisciplinary task A team traditionally known as “mine operations”
that must be coordinated to be undertaken in is in charge of extracting the materials from Another reason behind the growing need for
a safe and effective way. The work teams that the mine. In metals mining this is done in energy in mining has to do with the essentially
participate include, among others: geology, the following unit operations sequence: nonexistent continental waters available to supply
geotechnics, planning, topography, mine drilling, blasting, loading, transportation. the consumption of new operations, with an
operations, maintenance, administration, increasing need to transport water from the sea
services, and support in health, safety, the Together the unit operations and the equipment and the energy expenditure associated with it.
environment and quality, among consultants and/or technology used to undertake each one
from diverse areas. The geology team’s mission make up a “mining system,” which is closely While the price of copper has a direct effect
includes providing information on the physical, related to the “exploitation method” in question. on the industry’s productivity (periods of
chemical and mineralogical characteristics For example, currently the majority of large high prices foster the exploitation of mines
of the material to be extracted, which is the mines operating under the open pit method with lower ore grades and productivity, but
starting point of the extractive process. This use a mine system in which the stripping or with economically reasonable results), it is a
information is taken by the engineering or extraction of the material is done with drilling fact that declining ore grades and increasing
planning group, which integrates it with other (mainly rotary) and blasting with explosives, hardness and impurity, in addition to the larger
variables related to operation, geotechnics, while loading and transportation is carried transportation distances, have made productivity
metallurgy, maintenance and costs, so as to out using a shovel-dump truck system. a priority focus for Chilean copper mining.
draft a production plan or “mine plan.” This plan
describes the materials that will be moved in the As already mentioned in previous chapters, the
operation and the resources required to do so. Chilean mining industry has been affected by
a gradual decline in the quality of its mineral
Movement of materials in the operation reserves. Copper ore grades are ever lower,
includes extraction and transportation of mainly due to the greater depths that mines
materials comprised of different qualities have reached, where the rock is harder. In
and concentrations of the element of interest. addition, in the case of open-pit mines, expansion
That is, material lacking in valuable content of operations habitually entails removing a
(“sterile” ), material whose valuable content larger proportion of sterile material or waste
does not justify processing it and materials for every tonne of ore to be recovered.
with different proportions (“ore grades”) of
elements of interest. This material, generically This scenario has a direct impact on higher
referred to as “ore,” will be destined to one of energy consumption per pound of fine copper
the process lines or the respective dump. produced and it has a negative effect on the

210 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 211
05 GRAVITATING CORE CHALLENGES

CHALLENGES, SOLUTIONS AND R&D LINES TABLE/19


Based on the information analyzed, the group of
experts who participated in the technical workshops
Challenges and phases of
identified four challenges: i) Increasing productivity; the core challenge: mine
ii) Increasing mineral resources and reserves; iii)
Environmental protection and social responsibility;
operations and planning
iv) Greater workplace safety and quality.

As described in the Background part of this


section, mine planning and operation includes four Mine project, engineering
Challenges/ Open-pit Underground
phases. These are: i) Exploration; ii) Mine project, exploration and mine control and
Phases mining Mining
engineering and mine control and planning (MC&P); planning (MC&P)
iii) Open-pit mining; iv) Underground Mining. The
table below indicates which of the challenges
identified applies to each of the phases. Increased
productivity

Increased mineral
resources and
reserves

Environmental
protection and social
responsibility

Greater workplace
safety and quality

Source: created by authors.

212 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 213
05 GRAVITATING CORE CHALLENGES

Challenge No. 1: Increase productivity TABLE/20


As mentioned throughout this book, productivity is a
central issue that the mining industry must address
Solutions And R&D Lines.
in the short- and long term. This is a challenge that Challenges: Increased productivity
cuts across all of the phases defined in the context
of this core challenge. However, due to the reasons Solution Stage R&D Lines
presented above, it gains particular importance
in the open pit and underground mining stages. Reduce direct intervention
by operators, thus · Improvement and development of techniques for
Exploration
In open-pit mining the solutions associated with the improving both safety as automation of sampling and sampling preparation.
movement of large volumes of earth long distances well as accountability.
and the management of assets, understood as
applying to the universe of equipment for engaging Optimal selection of
in the required activities, are identified as the mine · Improvement, development and standardization
equipment and calculation
lines of development to improve productivity. of methodologies and tools for selecting
of main fleets.
equipment and calculating fleets.
Mine Project,
Meanwhile, the solutions associated with increased Engineering,
productivity from underground mining is related to (MC&P)
the development of large-scale deep mining, which Estimating costs, · Improvement, development and standardization
among other things entails making progress with economic and financial of methodologies and tools for calculating
technologies that allow operation under high levels assessment of projects. costs and evaluation of mining plans.
of geomechanical stress and the development
and integration of autonomous operations.
· Fragmentation/blasting
Moving large volumes of
· High-tonnage conveyor belts
material large distances
· Constructability of terraces

· Integration of operations (mine-plant).


Open-Pit Mining · Online measurement of ore grades
in pits, shovels, conveyor belts.
· Integration of remote-controlled unit operations
Management of assets · Automation and autonomous operations
· Ease of maintenance: characterization
of main equipment, others.
· Development of systems for the continuous
feeding of crushers to reduce trucks’ waiting time.
continue on next page

214 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 215
05 GRAVITATING CORE CHALLENGES

Solución Etapa Líneas I+D

· Continuous mining
· Characterization.
· Gravitational flow.
Development of large- · Online measurement of ore grades.
scale deep mining · Support and fortification.
· Fragmentation/blasting
Underground · Automation and autonomous operation.
Mining · Operation under high levels of geomechanical stress

· Ease of maintenance: characterization


Management of assets.
of main equipment, others.

Source: created by authors.

Photograph: Max Donodo (Biotechnology Lab, Catholic University of the North )

216 / Mining technology roadmap 2035 Alta ley alta ley


05 GRAVITATING CORE CHALLENGES

Challenge No. 2: Increased mineral TABLE/21


resources and reserves Solutions and R&D Lines.
The second challenge identified in this core
challenge has to do with the first two phases: Challenges: Increased mineral
Mine Exploration and Project Engineering and Mine resources and reserves
Control and Planning. In the case of exploration,
a possible solution identified is to improve and
develop technologies that allow an increase in Solution Stage R&D Lines
the rate at which new discoveries are made.
Meanwhile, increasing mineral resources and · Improvement and development
reserves in the engineering and planning stage of prospecting techniques.
entails improving tools that allow, among other Increasing success · Improvement and development
things, the investment cycle for projects to be Exploration
rate of campaigns. of drilling technologies.
reduced, thus closing the gap in the projected · Improvement and development of
and real parameters and developing optimal characterization technologies.
strategies for the consumption of reserves.
Mine Project,
Reducing the duration of · Integrating knowledge from
Engineering,
the investment cycle operations and projects.
(MC&P)

Closing the gap in the projected · Characterization and modeling


and real parameters. of variables (geosciences).

· New sequencing tools (based on blocs, others)


that integrate operational restrictions.
· Improvement of tools for defining the
transition from pit to underground mine.
Optimal strategies for the · Improvement of tools for integrated medium
consumption of reserves. term mine planning in a mining district.
· Holistic planning that integrates
relevant variables on geo-metallurgy,
geomechanics, then environment (acid,
wind, others), commercialization, etc.

Source: created by authors.

218 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 219
05 GRAVITATING CORE CHALLENGES

Challenge No. 3: Environmental Challenge No. 4: Greater workplace


protection and social responsibility safety and quality
As mentioned in previous chapters, socio- A constant concern for workplace safety is a
environmental aspects have gained continual focus of the mining industry’s attention.
particular relevance in the mining industry’s The accident rate in mining is less when
development and future sustainability. compared to other economic activities
In this context, the R&D lines identified in the undertaken in the country, while the
context of this challenge are associated with the mortality rate has gradually declined.
management of waste and its potential impacts. This Roadmap identifies this aspect as an
important challenge for the exploration phase,
in which the idea is to make progress in the
table/22 development of techniques to reduce direct
intervention on the part of operators.
Solutions and R&D Lines. Challenge:
Environmental protection
and social responsibility table/23
Solutions and R&D Lines. Challenge:
Greater workplace safety and quality
Solution Stage R&D Lines

· Control of dust/emissions
Solución Etapa Líneas I+D
· Techniques that allow the future
Management of waste use of land and to control erosion.
Open-pit mining
and its potential impact. · Potential for acid production. Reduce direct intervention by · Improvement and development
· Tires. operators, thus improving both Exploration of techniques for automation of
· Lubricants. safety as well as accountability. sampling and sampling preparation.

Source: created by authors.


Source: created by authors.

220 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 221
CORE CHALLENGE; MINE
OPERATIONS AND PLANNING RESOURCES

4
CAPACITIES
· Research in basic sciences.
· Universities contribute to research, instrumentation

CHALLENGES
and control.
· Advanced human capital specialized in: process
modeling, management of assets, mechatronics,
robotics, characterization and modeling of variables,
geo-metallurgy, geochemistry, geophysics and the
environment.
· Training of operators and maintenance workers
in Technical Training Centers who are experts in
automation and robotics.

13
· Technology think tank for mining.
· Organizations for the transfer of knowledge.

solutions SUPPLIERS
· Strengthen the development of local suppliers of
instrumentation, expert control, mechanization,
automation, robotization, information management,
optimization software, data transmission,
engineering design and specialized support services.
· System structured to accompany local companies

35
with technological capacities.

LINES OF R&D
ALLIANCES
· Alliances between national and international
universities and centers of excellence.
· Alliances between industries and Technical Training
Centers to train operators
· Alliances between research centers / Universities /
Industry / State/ Suppliers
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/7
Technology Watch:
Planning (Patents)

TOTAL PATENTS MOST-CITED PATENTS COUNTRIES WITH MOST PATENTS


2010-2015

43
Patent Year Citations

US8144245B2
USA 9
5 8
Method of determining a machine 2012 23 Australia 9
1
operation using virtual imaging 6
3 Finland 8
US8567871B2
Method for automatically creating a defined 2013 8 9 1 2 Germany 6
face opening in longwall mining operations Sweden 5
US7925474B2 France 3
System and methods(s) of blended mine 2011 7
planning, design and processing S. Africa 2

PATENTS US8070394B2 9 Japan 2


2011 6
Versatile grout bag type of underground support 2 Belgium 1
US7853439B2 Italy 1
2010 5
Mining optimisation
US2010104376A1
2010 5
Grout bag type of underground support
MAIN US8376467B2
TECHNOLOGICAL Method for automatically producing a defined 2013 4

TRENDS
face opening in plow operations in coal mining
MAIN · Sandvik Mining & Constr OY
US7681660B2
Arrangement for positioning drilling unit
2010 3 COMPANIES · Bhp Billiton Innovation PTY
· Procedures for underground AND/OR R&D · Sandvik Intellectual Property
or surface mine operation. US8886382B2 · Atlas Copco Rock Drills AB
· Diverse details related Method and system for regulating 2014 3 MAIN UNIVERSITIES CENTERS · FCI Holdings Delaware INC
to the equipment that movement of an entity between zones · Rag AG
creates the fractures or · University of Sydney · Trimble Navigation LTD
US7883298B2
completely frees the ore Supporting device for an advance 2011 3 · Soletnache Freeyssinet
material from the vein. working or mining machine · Sandvik Tamrock OY

224 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 225
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/8 MAIN RESEARCH INSTITUTIONS N°


Technology Watch: Chinese Academy of Science 5
Planning (Publications) AGH Science and Technology University 4
Warsaw Institute of Mechanized Construction and Rock Mining 4
SCIENTIFIC PUBLICATIONS SCIENTIFIC Technical University of Ostrava 4
2010-2015 PUBLICATIONS University of San Pablo 4

152
Polytechnic University of Silesia 3

36 United States Department of Agriculture 3


34 Oro Negro Federal University 3
2011
24 2013 University of Belgrade 3

18 22 18 University of British Colombia 3


2010
2014
2012 2015
COUNTRIES WITH SCIENTIFIC PUBLICATIONS
MAIN RESEARCH TRENDS N°
Ecology and environmental sciences 62 USA 17
Engineering 40 7 Australia 16
Ore processing 37
MOST-CITED 16 10 13
Canada 16
PUBLICATION 7
China 16
Metallurgy / Metallurgic engineering 17 16
17
Nitrate leaching from Poland 13
Water resources 15 organic arable crop rotations
Brazil 11
Geology 14 is mostly determined by
autumn field management Germany 10
Computer Sciences 12 11 S. Africa 9
Authors 16
9
Research in Operations and Administrative Sciences 11 Askegaard, M UK 7
Agriculture 10 Olsen, J.E. Turkey 7
Rasmussen, I.A.

226 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 227
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/9
Technology Watch:
Exploration (Patents)

TOTAL PATENTS MOST-CITED PATENTS COUNTRIES WITH MOST PATENTS


2010-2015

315
Patents Year Citations
USa 162
8 15
US7860301B2
2010 75 Australia 39
3D imaging system 7
34 16
Canada 34
US7756615B2
Traffic management system for a 2010 66 14 17 China 17
passageway environment 162
Germany 16
US7725253B2
Tracking, auto-calibration, and map-building system
2010 47 Sweden 15

PATENTS US7832126B2
Systems, devices, and/or methods
regarding excavating
2010 36
5
39
Switzerland 14
Finland 8
UK 7
US8325030B2
S. Africa 5
MAIN TECHNOLOGICAL Heat stress, plant stress and plant 2012 28
health monitor system
TRENDS
US8050206B2
2011 27
· Work with lasers Wireless network camera systems
· Seismology, Prospecting and US8235110B2 MAIN UNIVERSITIES MAIN COMPANIES AND/
seismic or acoustic detection. Preconditioning an oilfield reservoir
2012 22 OR R&D CENTERS
· Tunnels or galleries. · University of Sydney
US2011030586A1 · California Technology Institute
· Methods or guidelines for Carbonate products for carbon 2011 21 · Caterpillar INC.
reading or recognizing capture and storage
· Chinese University of Mining and Technology · Shell Oil CO.
printed or written character, · University of Jianghan
· Exxonmobil Upstream res CO.
US8585786B2 · Catholic University of Chile
or to recognize patterns. 2013 20 · Foro energy INC.
Methods and systems for briquetting solid fuel · University of Akron
· Systems that use reflection · University of Nevada · Tech resources PTY LTD.
or re-irradiation of the US2011096168A1 · Sandvik Mining & Constr OY.
Video delivery systems using wireless cameras
2011 16 · Southeastern University
electromagnetic waves · University of Utah Research Foundation · Halliburton Energy Serv INC.
that are not radio waves. · University of Western Ontario · Safemine AG.

228 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 229
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/10 Principales Instituciones de Investigación N°


Technology Watch: Chinese University of Geosciences 48
Exploration (Publications) Chinese University of Geosciences, Beijing campus 40
Commonwealth Scientific and Industrial Research Organization (CSIRO) 38
SCIENTIFIC PUBLICATIONS SCIENTIFIC Canadian Geological Service 26
2010-2015 PUBLICATIONS

449
Chinese University of Geosciences, Wuhan campus 20
93 91 University of Western Australia 20
88 2014 Chinese Academy of Geological Sciences 18
76 2015
Chinese Academy of Science 16
45 2013
2012
56 Islamic Azad University in Damavand 12
2010 Queen’s University 12
2011

COUNTRIES WITH SCIENTIFIC PUBLICATIONS


MAIN RESEARCH TRENDS N°
Geochemistry and Geophysics 11
Geology 11 14 China 108
Ore processing 11 29 Canada 105
105 23
Minerola Mineralogy ogía 14 MOST-CITED Australia 94

PUBLICATION 34 28 108 USa 34


Ecology and environmental sciences 16 13
UK 29
Remote Sensors 19 The “chessboard” classification 18
Iran 28
Physical Geography 62 scheme of mineral deposits:
Mineralogy and geology from Germany 23
Computer Sciences 69 aluminum to zirconium 94 India 18
Engineering 174 Sweden 14
Authors
Other Technology and Science topics 190 Dill, Harald G. Egypt 13

230 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 231
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/11
Technology Watch:
Operation (Patents)

TOTAL PATENTS MOST-CITED PATENTS ON OPERATION COUNTRIES WITH MOST PATENTS IN PLANNING
2010-2015 Patent Citations

212
US7776256B2 USA 136
Earth-boring rotary drill bits and methods of manufacturing earth- 75 13 5
boring rotary drill bits having particle-matrix composite bit bodies Germany 32
7 5 32
US7802495B2 Holand 13
56
Methods of forming earth-boring rotary drill bits 5
136 4 Canada 7
US7954569B2

PATENTS
51
Earth-boring bits Australia 7
US8517125B2 UK 5
28
Impregnated material with variable erosion properties for rock drilling France 5
7 Sweden 5
US7913779B2
Earth-boring rotary drill bits including bit bodies having boron China 4
23
carbide particles in aluminum or aluminum-based alloy
matrix materials, and methods for forming such bits 3 Chile 3
US8156871B2 22
MAIN Liner for shaped charges

TECHNOLOGICAL US7784567B2 MAIN COMPANIES


Earth-boring rotary drill bits including bit bodies comprising
TRENDS reinforced titanium or titanium-based alloy matrix 19
AND/OR R&D
materials, and methods for forming such bits
· Drills especially adapted
CENTERS
US7807099B2
to change drilling Method for forming earth-boring tools comprising 18 · Baker Hughes INC.
direction, with means for silicon carbide composite materials · Halliburton Energy Serv INC.
collecting substances. US8322466B2 MAIN UNIVERSITIES · Kennametal INC.
· Manufacture of composite Drill bits and other downhole tools with hardfacing having tungsten carbide 17 · Longyear TM INC.
layers, parts or objects pellets and other hard materials and methods of making thereof · Chinese University of Mining and Technology · Potter Drilling INC.
based on metallic US7977420B2 · Schlumberger technology BV
dusts, sintered with or Reactive material compositions, shot shells including 14 · Smith International
reactive materials, and a method of producing same
without compacting. · TDY IND INC.

232 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 233
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/12 MAIN RESEARCH INSTITUTIONS N°


Technology Watch: Tarbiat Modares University 16
Operation (Publications) Shahrood University of Technology 13
Islamic Azad University in Damavand 12
SCIENTIFIC PUBLICATIONS SCIENTIFIC Beijing Institute of Technology 10
2010-2015 PUBLICATIONS Chinese University of Mining and Technology 9

364
Chinese Academy of Science 8
77 Indian Institute of Technology 8
68
59 2014 Russian Academy of Science 8

50 2012 53 Commonwealth Scientific and Industrial Research Organization (CSIRO) 7


2013
2010 57 2015 Pratap University of Agriculture and Technology 7

2011
COUNTRIES WITH SCIENTIFIC PUBLICATIONS
MAIN RESEARCH TRENDS N°
MOST-CITED
Engineering 153
PUBLICATION
USa 64
13
Geology 97 China 63
TOUGHREACT Version 2.0: 27 11 Iran 52
Ore processing 88 A simulator for subsurface
reactive transport under 64 15 22 63 Canada 27
Ecology and environmental sciences 71
non-isothermal multiphase 52 India 22
Water resources 49 flow conditions 22
Turkey 22
Geochemistry and Geophysics 39 Australia 21
Authors
Metallurgy / Metallurgic engineering 29 Xu, Tianfu; 21 Spain 15
Spycher, Nicolas;
Meteorology and Atmospheric Sciences 20 Sonnenthal, Eric; et al. Russia 13
Computer Sciences 15 France 11

234 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 235
05 GRAVITATING CORE CHALLENGES

CORE CHALLENGE: ORE CONCENTRATION


BACKGROUND
As has been previously noted in
this book, productivity in mining has
declined due to factors that exceed
the decline in the quality of the
geological resource (measured by
sterile material ratio and ore grades).
In addition, the national mining industry’s
overall demand for energy has increased,
to a great degree due to the increased
processing of ore concentrate.

This means that concentration, the


productive process that follows The Core Challenge Ore
the extraction of sulfide ores, is a Concentration section was
priority aspect to be addressed if drafted based on work by
transformations are to be implemented the technical commission
to resolve the productivity challenges created for the core challenge,
that the industry faces. which was comprised of the
following members: Agustín
The concentration process starts Sepulveda, Andrés Pérez,
with reducing the size of particles, or
“comminution,” which consists in two Brian Baird, Carlos Urenda,
consecutive stages: crushing and wet Christian Schnettler, Claudio
grinding. They account for a significant Rojas, Cleve Lightfoot, Francisco
proportion of the cost associated with Abbott, Hugo Toro, Jorge Soto,
the concentration process due to the high Murray Canfield, Nury Briceño,
energy consumption that grinding entails. Pablo Asiain, Pierre Perrier.

Photograph: Codelco (Mine Pit, Chuquicamata)


The following team from
Fundación Chile was in charge of
drafting this section: Francisco
Klima, Tomás González, Enrique
Molina, Philip Wood, Cristóbal
Arteaga, Manuel Arre, Nicole
Valdebenito, Hernán Araneda.

236 / Mining technology roadmap 2035 alta ley alta ley


05 GRAVITATING CORE CHALLENGES

The copper sulfide ores that one seeks to recover GRAPH/38


through flotation-concentration are normally
accompanied by other minerals of lesser or no relative
Detail of spending
economic benefit (“gangue”), with their separation stages in operation of
being the objective of the concentration process.
concentration process
Thus a copper concentrate is obtained that is comprised
mainly of copper sulfides like bornite and chalcopyrite. Crushing 4%
Grinding 49%
The gangue is the “tail” of the flotation process and
is dumped as tailings. Collective flotation 11%
Thickening of Concentrate 1%
Electricity, steel (in the form of coatings and
Selective flotation 4%
grinding equipment) and water are inputs that
are critical to determining costs throughout this Tailings 3%
process, especially due to the initial process of Management of concentrate 1%
reducing particle sizes, or “comminution.”
Fresh water (desalinated) 21%
The grinding process accounts for the largest Reclaimed water 0%
proportion of the cost associated with concentration
due to its high energy consumption. In fact, over General concentrator 5%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
one third of the electricity consumed in metal
mining is used in the grinding process. This stage
shows low levels of energy efficiency (around 1%). Source: Cochilco (2014e)

In the case of crushing, efficiency is 50%, while


energy consumption corresponds to approximately
1% of the total required to produce copper.

This can be observed in the following graph.


requerido para la producción de cobre. Lo anterior
se puede observar en el siguiente gráfico.

238 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 239
05 GRAVITATING CORE CHALLENGES

With regard to the consumption of steel GRAPH/40


goods, it has been calculated that it will reach
1.077 million tonnes by 2025, equivalent
Supply-demand balance of
to a 127% increase over 2014 (Cochilco steel balls (2014-2015)
2014e) currently grinding costs account
for 22% of this stage’s operating costs.
1.000
900
800
Graph/39 700

Kton steel balls


2%
Operating cost of 600
grinding stage. 22% 500
400
300
Electric power for grinding
M&R Services (Mech-Elec) 200
52%
Grinding balls 3 and 5 100
Rest of grinding process 0
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
24%
Base Potential
Source: Cochilco (2014e) Probable National supply
Possible
Source: Cochilco (2015h)

Water is also in high demand in concentration The below graph shows that the national
processes, from grinding to flotation, and to supply of grinding balls is expected to surpass
facilitate the transportation of process tailings. demand between 2017 and 2018, but after
Continental water sources have traditionally been 2019 national supplies will only suffice to
used but over recent years increased volumes supply those projects classified as probable
of seawater have been incorporated, with the and a portion of the ones considered possible.
consequential impact on energy consumption.

240 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 241
05 GRAVITATING CORE CHALLENGES

Other problems affecting the grinding They are currently widely used in CHALLENGES, SOLUTIONS AND R&D LINES
and flotation process have to do with developments involving control of multiple
18
See Chapter 6, Based on the information analyzed, the group
Smart Mining
the accumulation of large particles that variables in the crushing, grinding, flotation Section. of experts who participated in the technical
reach the rougher flotation cells and can and thickening processes. For their part, workshops defined the following challenges
have a negative impact on the flow of the providers of maintenance services and identified solutions and R&D LINES
slurry, creating dead zones and reducing have also been adapting their models for them, which are presented below.
the recovery rate of valuable minerals, and practices to these new trends, in
in addition to increasing maintenance particular proactive maintenance: Challenge No. 1: Increased productivity
costs. The flotation process also needs In the current context this considered essential
to efficiently deal with fine particles Monitoring and registering the key for making progress in the management
to make efficient use of the kinetic performance parameters of a given piece of assets, to reduce energy and steel
energy that the process demands. of equipment to analyze patterns or consumption and also to more efficiently
signals to determine its conditions and use and transport water to increase the
In addition to the aforementioned in this way plan specific maintenance productivity of the ore concentration stage.
operating costs, the capital cost activities and program the right moment
(investment) required to concentrate for intervening in a given asset. In particular, it must be noted that there are
minerals is very high and can currently concentration plants in operation
become a “bottleneck.” This makes While the use of predictive models for with froth flotation cell banks that have an
management of assets particularly failures to undertake programmed extraordinarily high power installed and
important in concentration plants. maintenance is an accepted practice, there their operation needs to be subjected to
is an opportunity to increase productivity a critical cost effectiveness analysis.
Smart technologies18 have emerged as a if the modeling of fatigue and corrosion in
means for optimizing the use of assets critical parts is improved so maintenance
and improving process efficiency. In can be carried out in consideration of the
addition to improving people’s safety, cost and likelihood of failure. Among the
these technologies help to stabilize trends in maintenance services if organizing
processes (lower variability), cut costs, maintenance around the reliability of
increase productivity and improve the assets, according to their operational
quality of intermediate and end products. context and expected maintenance costs.

242 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 243
05 GRAVITATING CORE CHALLENGES

TABLE/24 Challenge No. 2: Increased mineral


resources and reserves
Solutions and R&D Lines. To increase the resource base and mineral
Challenge: increased productivity reserves, there is a need to increase
copper recovery, control for impurities
and develop new technologies.
Solution R&D Lines

Monitoring of key equipment TABLE/25


Handling of Uncrushable Material Solutions and R&D Lines.
Management of assets Instrumentation’s ease of maintenance Challenge: increasing mineral
Robotization and autonomous operation
resources and reserves
Impact of the use of seawater
Solution R&D Lines
Fragmentation/blasting
Selective flotation of byproducts
Pre-classification
Pre-concentration Development of automatic sensors and
controls / process optimizers
Development of new equipment and
adaptation of existing technologies. Increasing ore grades in concentrates Pyrite depression
Reducing energy and steel consumption and the recovery of element of interest
Classification efficiency Flotation of fines, roughers and sands
Development of automatic sensors and Explore use of nanoparticles in flotation
controls / process optimizers
Impact of the use of seawater
Impact of the use of seawater
Development of technology to guarantee
Grinding and coating means Control of impurities
the quality of concentrate
Use of seawater or desalinated water Development of new technologies Development of concentration methods
Efficient water use and transportation Reducing the water make-up
Source: created by authors.
More efficient pumping

Source: created by authors.

244 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 245
CORE CHALLENGE:
ORE CONCENTRATION RESOURCES

2
CAPACITIES
· Research in basic sciences
· Universities contribute to research,
instrumentation and control.

CHALLENGES · Advanced human capital specialized in: fluid


mechanics, materials sciences, nanoscience,
process modeling, robotics, automation and
control, geochemistry and environment.
· Training of operators and maintenance workers
in Technical Training Centers who are experts in
automation and robotics.
· Technology think tank for mining.

6
· Organizations for the transfer of knowledge.

SOLUTIONS SUPPLIERS
· Strengthen the development of local suppliers of
instrumentation, expert control, mechanization,
automation, robotization, information
management, optimization software, data
transmission, engineering design and specialized
support services.

24
ALLIANCES
· Alliances between national and international
universities and centers of excellence.

R&D & i LINES · Alliances between industries and Technical


Training Centers to train operators
· Alliances between research centers / Universities
/ Industry / State/ Suppliers
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/13
Technology Watch:
Crushing (Patents)

TOTAL PATENTS MOST-CITED PATENTS COUNTRIES WITH MOST PATENTS


2010-2015

77
Patent Year Citations
US7861955B2
2011 5
Wet-grinding gypsum with polycarboxylates UK 22
US8960337B2 3 Germany 16
High impact resistant tool with an apex width 2015 5 5 4 16
between a first and second transitions Australia 13
US8302890B2 1
2012 4 22 2 2 Canada 5
Modular ore processor
UK 4
US8022019B2
2011 3 Russia 3
Method of making proppant used in gas or oil extraction

PATENTS
US8434706B2 Chile 2
Overburden removal system with 2013 2
triple track mobile sizer 13 Switzerland 2
WO2010037215A1 China 2
2010 2 2
Method and apparatus for processing a sized ore feed France 1
MAIN EP2319624A1
Method for fine crushing of lump material
2011 2
TECHNOLOGICAL US2010044276A1
TRENDS Method and apparatus to create an oil sand slurry
2010 2
MAIN · Tech Resourses PTY LTD
DE102009018236A1
· Preliminary treatment Mobile crusher for use in open-cast mining for COMPANIES · Takraf GMBH
· Unimin Corp
of ore or scrap crushing broken rock, has loading belt connected
2010 2 AND/OR R&D · Joy MM Delaware INC
· Methods or ancillary devices with hopper, suspended by hydraulic cylinder on
or accessories especially upper ring support at raised and lowered position MAIN UNIVERSITIES CENTERS · Thyssenkrupp Foerdertechnik
and partially compensated by counterweight · Suncor Energy INC
adapted to to crushing · Chinese University of Mining and Technology
and disintegration US8182601B2 · Arter Teknolodzhi LTD
Powder formed from mineral or rock · University of Houston · Harnischfeger Tech INC
· Means of transport 2012 1 · University of Melboune
material with controlled particle size · Corporación Nacional
specially adapted to distribution for thermal films
underground conditions. del Cobre - Codelco

248 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 249
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/14 MAIN RESEARCH INSTITUTIONS N°


Technology Watch: University of British Colombia 3
Crushing (Publications) Chalmers Technical University 2
Chinese University of Mining and Technology 2
SCIENTIFIC PUBLICATIONS 2010-2015 SCIENTIFIC University of Cape Town 2

46
PUBLICATIONS ADP Group of Companies 1
AGH Science and Technology University 1
11 11 Amec Americas Limited 1

2011 8 2013 Aminpro Chile 1


7
2012 6 Caspeo 1

3 2015 Chinese University of Geosciences 1


2014
2010
COUNTRIES WITH SCIENTIFIC PUBLICATIONS

MAIN RESEARCH TRENDS N°


2 3 S. Africa 6
Ore processing 46
Australia 4
Mineralogy 20 3
MOST-CITED Chile 4
Engineering 19
PUBLICATION 4 3 USA 4
Metallurgy / Metallurgic engineering 12 2 Canada 3
Large particle effect in 2
chemical/biochemical heap China 3
Chemistry 4
leach processes - A review Sweden 3
Materials sciences 2
Authors 4 Finland 2
Nuclear Science and Technology 2 Ghorbani, Y. 6 India 2
Becker, M. 4 Iran 2
Fossil fuels 1
Mainza, A.

250 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 251
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/15
Technology Watch:
Grinding (Patents)

TOTAL PATENTS MOST-CITED PATENTS ON GRINDING COUNTRIES WITH MOST PATENTS IN GRINDING
2010-2015

113
Patent Year Citations

US8147980B2 USA 38
Wear-resistant metal matrix ceramic composite 2012 8 6
parts and methods of manufacturing thereof 5 Australia 17
5
10 Germany 10
US7757976B2
Method of processing nepheline syenite powder 2010 7 4 4
38 Chile 6
to produce an ultra-fine grain size product
Denmark 6
US7954734B2

PATENTS
2011 7 5 India 5
Disruptor system for dry cellulosic materials

WO2012016286A1 Finland 5
2012 6
Sorting mined material UK 5
17
US7677079B2 Japan 4
2010 6
Method and device for sensing wear
6 France 4
US7861955B2
2011 5
Wet-grinding gypsum with polycarboxylates
US8960337B2
MAIN TECHNOLOGICAL High impact resistant tool with an apex width
between a first and second transitions
2015 5

TRENDS US7690589B2
Method, system and apparatus for the deagglomeration 2010 4
MAIN UNIVERSITIES MAIN · Smidth & CO AS F L
· Presses specially adapted and/or disaggregation of clustered materials COMPANIES · Unimin Corp
to specific ends · McGill University · Outotec OYJ
· General layout of US8302890B2
2012 4 · University of KwaZulu-Natal
AND/OR R&D · Metso Minerals France SA
separation in the plant
Modular ore processor
· University of Queensland CENTERS · Schlumberher Technology BV
· Control systems especially adapted US8157193B2 · University of Santiago de Chile · Tech Resources PTY LTD
to crushing and disintegration Waterless separation methods and 2012 3 · University of Melboune · Arter Technology BV
systems for coal and minerals
· Metalworking · KDH Humboldt Wedag GMBH

252 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 253
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/16 MAIN RESEARCH INSTITUTIONS N°

Technology Watch: Grinding Chinese University of Mining and Technology 10


(Publications) University of Saskatchewan 9

Korea Institute of Geoscience and Mineral Resources 7


SCIENTIFIC PUBLICATIONS SCIENTIFIC University of Pretoria 7
2010-2015 PUBLICATIONS
61

296
Chinese Academy of Science 6

56 2015
United States Department of Energy 6

50 University of British Colombia 6


46 2013
43 2014
French National Center for Scientific Research 5
40 2012 Spanish High Council for Scientific Research 5
2011
2010

COUNTRIES WITH SCIENTIFIC PUBLICATIONS


MAIN RESEARCH TRENDS N°
Engineering 107
Geology 62 USA 43
Ore processing 54 China 41
MOST-CITED 33 14 13
Ecology and environmental sciences 53 Canada 33
PUBLICATION 16
18
India 20
Water resources 34 43 41
14
Poland 18
Geochemistry and Geophysics 33 Large particle effect in 20
chemical/biochemical heap Spain 16
Metallurgy / Metallurgic engineering 21 leach processes - A review France 14
Meteorology and Atmospheric Sciences 19 13 Turkey 14
Authors
Remote Sensors 15 Ghorbani, Y. Australia 13
Becker, M. Germany 13
Computer Sciences 13
Mainza, A.

254 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 255
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC / 17
Technology Watch: Flotation (Patents)

TOTAL PATENTS MOST-CITED PATENTS COUNTRIES WITH MOST PATENTS


2010-2015

88
Patent Year Citations

US7763166B2 USA 38
2010 16
Relocatable countercurrent decantation system 3 Canada 13
US8011514B2 13 9
Modified amine-aldehyde resins and 2011 11 3 Australia 10
uses thereof in separation processes Germany 9
38 4
US8424601B2 Brazil 5
System and method for minimizing the negative 2013 10
enviromental impact of the oilsands industry Japan 4
Russia 3

PATENTS
US8757389B2
Amine-aldehyde resins and uses 2014 10 France 3
thereof in separation processes 5 10
N. Zealand 3
US8133970B2
2012 9
Oxidized and maleated derivative compositions
2 Chile 2
3
US9114406B2
2015 7
Steam driven direct contact steam generation
US7922788B2
Process for recovering gold and 2011 5
silver from refractory ores
MAIN TECHNOLOGICAL US8025341B2
2011 5 MAIN UNIVERSITIES MAIN · Barrick Gold Corp
Mobile oil sands mining system
TRENDS COMPANIES · Basf AG
CN102085526B · Technical University of Aquisgran · BHP Billiton SSM Dev PTY LTD
· Expected effects of Recycling method of blast furnace dust 2012 5 · University of Manchester
AND/OR R&D · Cytec Tech Corp
flotation agents generated in steel making industry
· McMaster University CENTERS · Evonik Industries AG
· Specified materials treated US2011155651A1 · University of Osaka · Ex Tar Technologies INC
by flotation agents, Separation of copper minerals from pyrite 2011 2 · University of Utah Research Foundation · Geordia Pacific Chemicals LLC
specific applications using air-metabisulfite treatment
· Sumimoto Metal Mining CO

256 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 257
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/18 MAIN RESEARCH INSTITUTIONS N°


Technology Watch: Flotation University of Belgrade 9
(Publications) University of Queensland 9
University of Cape Town 7
SCIENTIFIC PUBLICATIONS SCIENTIFIC Chinese University of Mining and Technology 4
2010-2015 PUBLICATIONS

109
AGH Science and Technology University 3

24 Amirkabir University of Technology 3

19 Chinese Academy of Science 3


18 18 2013 Chinese National Engineering Research Center of Clean Coal Combustion 3
2014 16 Krakow Agricultural University 2
2010 14 2012
Al-Hussein Bin Talan University 2
2015
2011

COUNTRIES WITH SCIENTIFIC PUBLICATIONS


MAIN RESEARCH TRENDS N°
Ore processing 60
Engineering 46 China 16
Australia 11
Mineralogy 34
MOST-CITED 6 9 S. Africa 11
Metallurgy / Metallurgic engineering 22 9
PUBLICATION 16
Poland 9
Ecology and environmental sciences 15 6 8
Serbia 9
Chemistry 14 Large particle effect in 6
chemical/biochemical heap Turkey 8
Materials sciences 6 leach processes - A review Brazil 6
Fossil fuels 5 11 Canada 6
Authors 6
11 Iran 6
Biochemistry and Molecular Biology 2 Ghorbani, Y.
Becker, M. USA 6
Biotechnology and Applied Microbiology 2 Mainza, A.

258 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 259
05 GRAVITATING CORE CHALLENGES

CORE CHALLENGE: HYDROMETALLURGY Thus, the industry has not incorporated currently operating (brownfield projects),
BACKGROUND
19
The main any new leachable deposits to its resource where the increasing depth of deposits will
processes
Copper Hydrometallurgy is the method involved are: base. While an average of 2 million tonnes of lead to the depletion of oxide ores. This,
used to process copper oxide ores and agglomeration, electrowon cathodes were produced from 2009 together with declining ore qualities, both in
some types of sulfides. It prompts diverse ROM leaching, to 2012, in 2013 and 2014 it fell to around 1.9 terms of ore grades as well as the leachable
physical and chemical reactions19 to Heap leaching, million and 1.8 million tonnes, respectively. quality, has led to recent estimates that
solvent
extract the copper from the rest of the extraction and just 12% of projected copper production in
crushed material, dissolving it in an acid electrowinning. In the same way, mining companies’ project 2026 will be cathodes produced through
solution (leaching stage) before then portfolios and future development plans are electrowinning, thus resulting in significant
continuing with a solvent extraction heavily based on maximizing mines that are idle capacity at electrowinning plants.
stage followed by electrowinning to
produce high-purity copper cathodes.

Oxides are formed near the surface


because they are ores produced by a
deposit’s oxidation process as it is attacked The Core Challenge GRAPH/41
by the oxygen in the air and in the form of Hydrometallurgy section
oxidizing fluids (water, air) (Codelco, 2008) was drafted based on work
Projected Chilean copper
by the technical commission production through 2026
The industry has been going to increasingly created for the core challenge,
greater depths to extract minerals (open which was comprised of the
pit mines are ever deeper and/or are following members: Agustín 7.500
becoming underground mines, while Sepulveda, Andrés Pérez, 5,75 Mton 6,16 Mton

Copper production (Kton)


underground mines are also going deeper). Brian Baird, Carlos Urenda,
6.000
Christian Schnettler, Claudio 12%
Rojas, Cleve Lightfoot, Francisco 32%
Abbott, Hugo Toro, Jorge Soto, 4.500
Murray Canfield, Nury Briceño, 68% 88%
Pablo Asiain, Pierre Perrier. 3.000

The following team from 1.500


Fundación Chile was in charge of
drafting this section: Francisco 0
Klima, Tomás González, Enrique 1990 1994 1998 2002 2006 2010 2014 2018 2022 2026
Molina, Philip Wood, Cristóbal
Arteaga, Manuel Arre, Nicole
Valdebenito, Hernán Araneda. Concentrates Cathodes Sx-Ew
Source: Cochilco (2015e)

260 / Mining technology roadmap 2035 alta ley alta ley Mining technology roadmap 2035 / 261
05 GRAVITATING CORE CHALLENGES

In the coming years development of the Lastly, it is worth mentioning that significant
national mining industry will be based on the improvements in productivity could make the
exploitation of sulfide ore reserves (mostly extraction of marginal resources that are currently
chalcopyritic), for which mineral concentration not considered part of reserves profitable. In other
processes are currently used. However, in words, technological step changes could turn these
this future scenario, hydrometallurgy must liabilities into assets, as has happened before.
also address treatment of sulfide ores.
Very significant new processes and technologies
Hydrometallurgy is uncompetitive compared in the field of hydrometallurgy have been
to concentration, as the latter allows over 90% developed over recent decades. In late 1980,
to be recovered in a matter of hours while the the Lo Aguirre Mine in the Metropolitan Region
former obtains between 35% and 60% in periods implemented a cathode production plant based on
of over 300 days. Along these lines, there is a technologies that were new at the time, combining
clearly crucial need to endow hydrometallurgy a novel Thin Layer (TL) heap leaching process with
with technologies that allow it to increase solvent extraction and electrowinning operations.
its efficiency in terms of recovery times.
It was the first plant in the world to apply the
In addition to this, it must be kept in mind that TL heap leaching process on a commercial
energy is the most significant cost item in the scale, in addition to being the first commercial
hydrometallurgical process. Depending on the application in Chile of the copper solvent
purchase price, it represents between 25 and 30% extraction and electrowinning process.
of the total (with between 80% and 90% of this
expense generated by the electrowinning process) This new process made it profitable to extract
copper from ores with grades below 0.5%,
In the case of water, while its consumption is as is currently the case in mines like El Abra,
relatively low (0.1 to 0.2 m3 per ton of ore), Radomiro Tomic and Lomas Bayas. TL heap
potential future usage restrictions associated leaching integrated with solvent extraction
with the challenges mentioned earlier in this and electrowinning became one of the most
book and the implications this might have for important innovations in copper mining in
the leaching of low-grade sulfide ores could metallurgy in the 1980s and 1990s, both in
halt the implementation of this process. Chile as well as in the rest of the world.
Photograph: Codelco (city of El Salvador)

262 / Mining technology roadmap 2035 Alta ley


05 GRAVITATING CORE CHALLENGES

CHALLENGES, SOLUTIONS AND R&D LINES Challenge No. 2: Increased productivity


Based on the information analyzed, the group Improving the efficiency of processes, both in
of experts who participated in the technical terms of the kinetics of copper extraction as
workshops defined the following challenges well as the consumption of acid and energy,
and identified solutions and R&D lines. is and will continue to be a very important
matter for dealing with declining ore grades,
Challenge No. 1: Environmental the soluble content of the ores and the
protection and social responsibility presence of acid consuming varieties.
A very important issue is related to the need for a
“social license” to operate, to obtain communities’
acceptance of operations, conditioned,
among other things, on full compliance with TABLE/27
environmental regulations. Because of this,
adequate handling of hydrometallurgical wastes
Solutions and R&D Lines.
is a fundamental activity for the industry. Challenge: increased productivity
Solution R&D Lines
TABLE/26 Reducing energy and water consumption Energy consumption in EW
Solutions and R&D Lines. Challenge: New leaching, solvent extraction
Development of new technologies
environmental protection and electrowinning process.

and social responsibility


Source: created by authors.

Solution R&D Lines

Management of solid, liquid and gaseous wastes Waste management

Source: created by authors.

264 / Mining technology roadmap 2035 Alta ley alta ley Mining technology roadmap 2035 / 265
05 GRAVITATING CORE CHALLENGES

Challenge No. 3: Increased mineral


resources and reserves
The existence of altered materials with a low In this context, the base of mineral resources
presence of soluble copper, the appearance of and reserves will continue to heavily determine
clays that affect the percolation of leaching pads productivity and the business outlook, which is why
and refractory copper ores (primary sulfides it is of the utmost importance that more efficient
of the chalcopyritic type), which are aspects and versatile treatment methods become available
that must be dealt with more and more. that are capable of responding to ore variability.

TABLE/28
Solutions and R&D Lines.
Challenge: increasing mineral
resources and reserves

Solution R&D Lines

Leaching of low ore grade ores (ROM,


oxides, sulfides) and gravels.

Concentrate leaching.
Use of future idle capacity Leaching of white metal, dusts.

Leaching of altered ores, clay


soils, producers of fines.

On-site leaching.

Photograph: Codelco (Refinery Inspector, Chuquicamata)


Recovery of copper and precious metals Precious metals recovery

New leaching, solvent extraction


Development of new technologies
and electrowinning process.

Source: created by authors.

266 / Mining technology roadmap 2035 Alta ley


CORE CHALLENGE:
HYDROMETALLURGY RESOURCES

3
CAPACITIES
· Research in basic sciences
· Universities contribute to research, instrumentation
and control.

CHALLENGES · Advanced human capital specialized in: surface


physicochemistry, nanoscience, mineral chemistry,
electrochemistry, process modeling, management of
assets, geochemistry and environment.
· Training of technical workers in expert operation and
maintenance skills at Technical Training Centers
· Technology think tank for mining.

6
SUPPLIERS
· Strengthen the development of local suppliers of

SOLUTIONS instrumentation, expert control, mechanization,


automation, robotization, information management,
optimization software, data transmission,
engineering design and specialized support services.
· System structured to accompany local companies
with technological capacities.

ALLIANCES

10
· Alliance between national and international
universities and centers of excellence.
· Alliance between industries and Technical Training

R&D & i LINES Centers to train operators and maintenance


workers.
· Alliance between research centers / Universities /
Industry / State/ Suppliers
05 GRAVITATING CORE CHALLENGES

INFOGRAPHIC/19
Technology Watch:
Electrowinning (Patents)

TOTAL PATENTS

61
MOST-CITED PATENTS COUNTRIES WITH MOST PATENTS
2010-2015 Patent Year Citations
5 Canada 16
US7901561B2 USA 11
Method for electrolytic production 2011 12 3
16 4
and refining of metals Bahamas 7
4
US7846233B2 6 4 6 Switzerland 6
2010 11 11
Leaching process for copper concentrates
7 South Korea 6
US8658007B2 Norway 5
2014 4
Oxygen-producing inert anodes for SOM process
Luxembourg 4
US7846309B2
2010 3 France 4
Metal electrowinning cell with electrolyte purifier

US7740745B2 China 4
2010 3

PATENTS
Non-carbon anodes with active coatings UK 3
CN101717969A
Alloy material suitable for inert anod