DEMANENG: BUILT ON PROWESS

2020-02-03T13:08:38+00:00 February 3rd, 2020|Mine Excursion|

Turning around a sinking ship requires resilience, experience, vision and skill – something Afrimat has in abundance, writes Leon Louw.

The Demaneng iron ore mine was Afrimat’s star performer in 2019.

The Demaneng iron ore mine was Afrimat’s star performer in 2019.

How do you transform a run-down, loss-making iron ore mine into a profitable, fairy tale story in less than two years? Ask Afrimat. Never scared of a challenge, the junior miner, who cut its teeth into the rough and tumble world of quarries and the South African construction sector, has achieved the same remarkable result at its Demaneng iron ore mine in the Northern Cape province of South Africa as what it has consistently achieved at its quarries around Southern Africa.

All photos by Cornel van Heerden for Afrimat

Afrimat’s success at Demaneng is built on pure operational prowess, replicated into the DNA of a company often forced to grind it out in the dust and grime of marginal quarries.

Operational excellence was exactly what the mine needed when Afrimat bought Demaneng from Diro Iron Ore in 2016 and invested more than R450-million in the project. On the doorstep of neighbouring Kumba’s Sishen mine, Demaneng is located in a prime geological suburb of the Kalahari Basin, and in close proximity to the major access roads and Transnet’s rail infrastructure. Notwithstanding its supreme geology and location, Diro couldn’t make it work, and eventually went into business rescue, which opened the door for Afrimat. That said, the iron ore price didn’t exactly assist Diro at the time, dropping to levels far below the psychological level of USD50 per tonne late in 2015. However, not long after Afrimat acquired the asset, iron ore prices almost returned to boom time levels, peaking at USD123 per tonne in July 2019. In the process, Demaneng became Afrimat’s star performer. The company was now well and truly on the way to becoming a diversified miner and continued rewarding shareholders generously.

Although Afrimat prefers to own all the mining equipment, they do hire some yellow metal at Demaneng.

Although Afrimat prefers to own all the mining equipment, they do hire some yellow metal at Demaneng.

Rescuing a failed operation

According to Gerhard Odendaal, managing director of Afrimat Bulk Commodities, transforming Demaneng into an efficient open cast operation meant putting in the hard yards. “The strong operational team was instrumental in turning the business around and aligning the workforce with the Afrimat value system,” says Odendaal. “When Afrimat arrived on site, we basically found a failed mining operation. The equipment and processing plant were in a bad state of neglect and the pit construction and development was totally flawed.”

When the company drafted an action plan in November 2016, they identified all the major challenges. Top of the list was dealing with 216 extremely hostile workers who hadn’t received a pay-cheque for more than eight months. Afrimat had to engage all these people to restore order. To make things worse, the mine was overstaffed, and the team had the unenviable task of cutting the workforce by more than half. “We terminated all the workers’ contracts in terms of a section 198 process and then we went through a rehiring process, which took about four months,” Odendaal explains.

The team’s next focus was to deal with technical issues and get the mine up and running again. “We called in the cavalry (other business units within the Afrimat group), to assist with repair and recommission of all the mining equipment, including tools, trucks, excavators, loaders and even the beneficiation and processing plants. Just about everything on site required refurbishment. To nurture a feeling of ownership and pride, Odendaal decided not to appoint external specialist contractors, but tasked the operations team to do most of the repairs and refurbishments.

Up and running

“We spent about R20-million on additional equipment, spares and tools to do the basic start-up, maintenance and to employ the mechanical staff. The mechanical staff we sourced in-house from other Afrimat divisions and they managed to get the show on the road and in April 2017 the mine started producing iron ore again, albeit in very small volumes. However, in August 2017, Demaneng was processing ore at about 50% of mine capacity. At that tempo the mine was on target to produce anywhere between 450 000 and 500 000 tonnes per year. In parallel, Afrimat commenced with construction of a load out station about three kilometres from the mine site and towards the end of 2017 negotiated a million-tonne per annum take off agreement with Transnet.

Mobile equipment is used to crush ore from different mini pits on the property.

Mobile equipment is used to crush ore from different mini pits on the property.

However, the mine suffered a set-back early in 2018 when Transnet informed management that they could not provide the million tonnes per annum allocation any longer. “This was a huge set-back because we geared our mine to produce and sell a million tonnes a year, forcing us to cut back production with almost 43%. Through continued engagements with Transnet during the next five or six months, eventually, in August 2018, we managed to secure and ramp up to 900 000 tonnes of export capacity per year. It required increasing the rail track capacity of our load out facility to take a whole train instead of half a train,” Odendaal explains. Since August 2018 Demaneng has been producing close to its original target of one million tonnes of iron ore per annum.

The mine ends up with a stock-pile of one and a half million tonnes of unprocessed fines of less than 1mm which will hold about 700 000t or 800 000t of sellable ore

The mine ends up with a stock-pile of one and a half million tonnes of unprocessed fines of less than 1mm which will hold about 700 000t or 800 000t of sellable ore

Rebuilding the DMS

Afrimat inherited two Dense Media Separation (DMS) beneficiation plants which, Odendaal says is more efficient than using a jig. “When we arrived, these plants were clogged up solid and shut down, so the team had to rewire, strip and re-assemble them – a process that took us the better part of six months,” he says. The larger plant can produce about 160t of final product per hour, while the smaller plant has a capacity of 110t per hour. According to Odendaal the existing crusher unit on the larger plant caused massive bottlenecks. “Their DMS design, though, is really good. The problem was providing consistent and reliable Run of Mine (RoM) feed, so one of our first actions was to invest about R35-million in rebuilding a new upgraded crusher,” says Odendaal.

At the other DMS plant Afrimat deployed their mobile crusher division to supply the ROM feed. However, they are in the process of replacing all mobile crushers with a fixed plant to save further processing costs. Mobile crushing is more expensive than fixed plant crushing in terms of the energy input, staffing, and maintenance. The two beneficiation plants are about three kilometres apart.

Replacing an ageing fleet

The mine has also started replacing its ageing mining fleet. “The equipment is now nearing 16 000 hours and we are carefully considering small interventions on replacement and or rebuilds. At the moment that is a work in progress. Although the stripping ratio at 1 to 1.5 is relatively low, the production rate since August 2018 has accelerated significantly. The inherited mining equipment didn’t have the capacity to handle an increase in ore production, which necessitated the mine to hire additional equipment, something Afrimat is not known to do.

Since August 2018 Demaneng has been producing close to its original target of one million tonnes of iron ore per annum.

Since August 2018 Demaneng has been producing close to its original target of one million tonnes of iron ore per annum.

“One of the optimisation projects is to increase our own mining fleet over the rental equipment that we currently employ to supplement the mining. The Afrimat business model prefers to own and control our mining fleet; a strategy that stems from our quarry operations. All Afrimat quarries own and operate their own equipment. This strategy has worked for us but due to the significant investment requirement, we had to prioritise capital investments and
we decided not to do it on the mining equipment side because rental equipment is readily available,” says Odendaal. Currently the mine is renting three excavators, six Articulated Dump Trucks (ADTs) and a few water trucks.

An unconventional mine

Demaneng does not host a single, uniform ore body. It is not a conventional mine and there are a number of mini pits on the property between 60m to 120m deep. Afrimat utilises three of these pits at any one time and blends the mined products. This mining method calls for smaller equipment to be used at several locations at different times, somewhat different from conventional mega operations like a Sishen mine that employs much larger equipment.

“One of the optimisation projects is to increase our own mining fleet over the rental equipment that we currently employ to supplementthe mining.”

The blend from the different pits are fed into a primary crusher (a Metso 120 Jawcrusher) from where it splits into a secondary crusher (a Sandvik UH430) and a tertiary crusher (Osborn 44H). From here the material splits into various slipping streams and the fine ore component is split with a high frequency screen into a -1mm fraction. Odendaal says they are currently investigating other methods to do some ultra-fine beneficiation. “We ultimately end up with a stock-pile of one and a half million tonnes of unprocessed fines of less than 1mm which will hold about 700 000t or 800 000t of sellable ore.

Dealing with challenges

Other major challenges on site, according to Odendaal, was dealing with the slimes and the lack of available sub-surface water. “Water is not readily available in the area and 50% of our current water supply is sourced from an underground aquifer up to 180m deep. The balance is purchased commercially from the bulk water supply scheme.

Odendaal, who has a lot of experience in managing quarries, says the methods of mining a quarry and an open cast mine, are usually the same. “Both involve drilling and blasting the overburden and ore and disposing of it using specific mining equipment. However, the difference between Demaneng and any other quarry is that the ore body at this mine is a sedimentary deposit in random pockets of dolomite. It is therefore not uniform and sits in an erratic formation which makes it necessary to follow the higher graded ore body, so there are fewer consistent neat bench formations, haul roads and ramps, and that is the most important difference,” says Odendaal. Furthermore, quality control is an important function when mining iron ore as the grade and quality are far less predictable than in quarries where there are large benches featuring the same quality of material. The quality control and laboratory work is conducted as an in house function, affording the mine speedy turnaround times and priority access to testing which in turn speeds up accurate selective mining.

Afrimat has secured 900 000 tonnes of export capacity per year from Transnet.

Afrimat has secured 900 000 tonnes of export capacity per year from Transnet.

Despite the challenges, Demaneng has gone from strength to strength. Odendaal says it has a lot to do with the fact that the operations team at the mine doesn’t know when to give up. “This attitude comes from the top and filters through to the bottom, and it works for us. The entire company works together. Attacks the issues and finds solutions. We also found ourselves in the fortunate situation where we managed to secure some of the most competent industry experts in iron ore extraction and beneficiation, which positively shortened Afrimat’s learning curve in the iron ore sector, concludes Odendaal.


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