Very quietly, BHP has boosted its spending over the next year on its revamp of its huge Olympic Dam mining operations in South Australia to more than $10 million a week.
At the same time the company’s WA based nickel business is moving closer to a major expansion and a new hi tech processing operation that will see the company tap the push to electric vehicles.
On July 19, the company revealed it would be spending $350 million on maintenance and asset renewal work at the huge underground mine. Details of that work were contained in BHP’s 4th quarter production report.
But a week ago that figure was boosted to “More than $600 million” in a speech by the BHP executive in charge of Olympic Dam, Jacqui McGill.
She said the work would consist of 49 separate projects over the year to June 2018, with over 1,300 people (mostly contractors) being employed.
The work will see output of gold, copper and uranium from olympic Dam fall for much of the next year as the work progresses. The activity starts this month.
“This represents the most significant investment we’ve ever made in our South Australian operations. And these investments – in our underground infrastructure and above ground processing operations – will help us build the foundations for long term, safe, stable and sustainable growth at Olympic Dam,” she said.
“The investment will ensure the operation is more modern, reliable and can support processing of additional tonnes in coming financial years.”
“Forty of these projects are being supported by BHP’s new functional-regional model, which means Olympic Dam can draw on the incredible expertise within BHP’s Minerals Australia projects team,” she said.
She said the $600 million plus will be spent in three key areas at Olympic Dam:
“Around 20 per cent of the investment supports the underground expansion into the high-grade Southern Mine Area including additional fleet, telecommunications, raise bores, power and other services;
“Nearly 40 per cent will underpin further underground development in the existing Northern Mine Area footprint; and
“As announced, more than 40 per cent is directed to a wide range of infrastructure and other programs onsite, including the major smelter campaign – which is a $350million construction program spread across FY2017 and FY2018,“ Ms McGill added.
To support the additional work at Olympic Dam, Ms McGill said the Company was recruiting to make sure the best people were working with the team.
Through natural attrition, as well as the support of current and future growth projects, Olympic Dam expects to continue to have a rolling requirement for around 250 roles at any one time, Ms McGill added.
Meanwhile BHP’s Nickel West is about to start work on a the world’s largest nickel sulfate plant as it moves closer to the go ahead for the multi million dollar expansion of its WA mining operations.
Nickel West, which only a few years ago was facing closure after the multi billion dollar failure of the Raventhorpe nckle mining and processing business, will invest $US43.2 million into a downstream processing plant at Kwinana, south of Perth, as part of a broader plan to move deeper the growing lithium-ion battery market.
“Lithium-ion batteries are growing at spectacular rates, the role of nickel is significant in lithium-ion batteries and the concentration of nickel is increasing because it increases energy density and gives greater range,” Nickel West head, Ed Haegel said last week at the Diggers and Dealers Conference in Kalgoorlie..
The new sulfate plant will produce 100,000 tonnes a year of nickel sulfate hexahydrate, and will be bigger than any other similar facility currently in operation around the world. The company will also look at doubling output once the first phase is complete.
Nickel sulfate is a powder material that is suitable for use in batteries, and sells at a nice price premium to typical nickel metal cathode and concentrate.
