Special to The Northern Miner
The nickel industry reached an evolutionary milestone recently when the Cawse mine in Western Australia became the first of a new generation of low-cost laterite deposits to produce nickel metal on site.
If the hydrometallurgical processing technique proves successful, Cawse will go down in history as the first of a new wave of nickel mines that threatens to shift the balance of production from the hard rock mining camps in Canada and Russia to the soft rock deposits of the Southern Hemisphere, especially Australia and New Caledonia.
Cawse has already been joined by two other Australian producers: the larger Murrin Murrin deposit owned by Anaconda Nickel (60%) and Glencore International (40%) and Preston Resources’ Bulong deposit. The trio of new laterite mines is expected to produce metal at a rate of about 65,000 tonnes nickel and 6,000 tonnes cobalt per year by the end of the year.
This new supply will be a drop in the bucket compared with the 1-million-tonne annual nickel market, but future production from laterite deposits waiting in the wings could lead to serious oversupply once HPAL technology becomes more established.
Under that scenario, analysts say, many higher-cost sulphide nickel operations, such as those in Sudbury, Ont., and Thompson, Man., would be sidelined.
The cost of producing a pound of nickel from underground sulphide deposits averages about US$2. By comparison, cost estimates for producing nickel from laterite deposits amenable to HPAL fall in the range of 50-80 cents per lb., after byproduct credits. Nickel currently sells for about US$2.20 per lb.
“It will take a quarter of solid production before we know if the technology is working [in Australia],” says Manford Mallory, an analyst with Research Capital.
All three of the projects have experienced problems (mostly mechanical failures) during commissioning. Anaconda says these issues are being addressed and that Murrin Murrin, the largest of the new mines, will begin running at full capacity of 45,000 tonnes nickel and 3,000 tonnes cobalt per year by the first quarter of 2000. The company recently won environmental approval to expand this capacity to 115,000 tonnes nickel and 9,000 tonnes cobalt.
If the Australians are able to sort out the bugs, the impact on the nickel industry would be comparable to the revolution experienced by the copper mining industry following the introduction of SX-EW and, to a lesser extent, by the gold mining industry following the development of heap leaching. In both cases, these new technologies made shallow oxide deposits attractive alternatives to their sulphide cousins because they could be mined and processed at much lower costs.
The entry of new Australian companies into the market has not gone unnoticed by North America’s major nickel producers, though they are generally reluctant to discuss their plans for competing with the gutsy newcomers.
“It’s too speculative to speak about at this point,” says Jerry Rogers, director of corporate affairs for
Inco is building a $50-million pilot plant to test the technology at the Goro nickel laterite deposit in New Caledonia. The plant is expected to be up and running in August, and a production decision will likely be made next year.
Goro may steal the show from the ill-fated Voisey’s Bay nickel sulphide deposit in Labrador. Inco had high hopes when it purchased Voisey’s Bay for $4.3 billion in 1996, but difficult negotiations with the Newfoundland government and depressed nickel prices have turned the high-grade sulphide deposit into something of a white elephant.
“Sherritt’s investment in Anaconda reflects the corporation’s positive, long-term outlook for the projects Anaconda has under way,” the release stated.
Research Capital’s Mallory says the Sherritt move lends a large dose of credibility to the Australian projects.
“We are following behind the Australian plants,” says Michael King, director of metallurgical technology. “The first people in the field always uncover some issues, and we are trying to uncover as many of these issues as we can ourselves. If they make a mistake, it’s a commercial mistake, but we are doing it on the pilot scale so that when we build our plant we will have fewer problems to overcome.”
He says some of the challenges the Australians must overcome include corrosion from high-salinity water in the process plant and adjustments to engineering design required to accommodate site-specific ore compositions.
Nickel laterite deposits are the products of deep weathering of ultrabasic rocks under tropical conditions of heavy rainfall and high temperatures. The soft material is a mixture of nickel oxides, silicas and clays, and the ore is classified as either saprolite (for example, PT Inco’s Sulawesi deposit) or limonite (such as Anaconda’s Murrin Murrin deposit). Saprolite is treated pyrometallurgically, whereas limonite is amenable to hydrometallurgical techniques such as HPAL.
The advantage of HPAL over other laterite processing techniques is that it can produce nickel with cobalt credits at higher recoveries, lower capital costs and lower energy and labour inputs.
The process involves feeding the ore into an autoclave, where it is dissolved by acid under pressure and at moderately high temperatures. Metals are recovered in solution, while the solids are removed from the slurry and deposited in a tailings dam. The metals are then precipitated out and the acidic effluent neutralized.
Pressure acid leaching was first introduced at Moa Bay in the late 1950s, when Freeport built a plant there to process 2 million tonnes of laterite ore per year. But Castro soon nationalized the operation, and technical information remained scarce.
In the 1970s, Amax launched a program to improve and develop the Moa Bay process for use at its Prony project in New Caledonia. California Nickel, owner of the Gasquet project in northern California, followed suit in the 1980s with a research and development program of its own. Neither plant was built, but both companies contributed their extensive research to the industry.
But without the changes in processing techniques witnessed by the mining industry over the past 20 years, HPAL would have remained an obscure technology. These advances include the development of SX-EW in the copper industry, improvements in the chemicals used to separate and purify nickel and cobalt, and, thanks to the gold mining industry, better autoclaves.
Australia is a natural testing ground for the fledgling technology because of its abundance of nickel laterites, good infrastructure, cheap power and mining know-how. More importantly, the country has the physical characteristics required to handle the huge amounts of liquid effluent produced by HPAL: the flat terrain provides space for the large tailings damns, and high evaporation rates allow some of the effluent to dissipate.
But other countries in Southeast Asia also stand to benefit economically from the development of HPAL. New
Caledonia is dotted with potential producers, including PT Inco’s Goro deposit,
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