Costmine has researched remote power rates costs across Canada and analyzed their effects on a cost-modelled lead and zinc milling operation and camp. The decision to exclude a mine model from the analysis was made as the mill and associated camp are typically the largest power consumers. Electric power rates were collected across Canada’s more remote territories, Northwest Territories, Nunavut, and Yukon, and averaged for each territory.
Efforts were made to ensure the mill model was typical of two-product-flotation lead and zinc projects. The selected flowsheet utilizes two flotation circuits (lead and zinc), a 1,250-tonne-per-hour SAG mill and two ball mills of differing sizes. The daily production rate was set at 30,000 tonnes per day with crushing five days per week and grinding occurring around the clock in the mill models. The relevant electric power rates are detailed in Table 1 and represent approximate averages.
The mills and camps were modelled utilizing Sherpa for Mineral Processing Plants, a windows-based application designed for estimating the costs associated with constructing and operating a mineral processing plant and associated camp. This software allows for easy editing of the electric power rate, and many other parameters, so identical models can be investigated with the only difference being the cost of electric power. Selected operating costs estimated with the models are presented in Table 2.
The data from both tables is presented in Figure 1. The range of electric power rates experienced across Canada’s remote territories clearly has a measurable impact on the operating costs of power-heavy mining activities, such as milling and a camp. As expected, this impact is felt most in equipment operating costs which comprises nearly 50% of total operating costs for the Nunavut model.
Figure 1 is also a good reminder that energy costs are one of many at a milling operating and camp, serving to dampen the impact of escalation in any one cost object. As Figure 1 demonstrates, a nearly 600% increase in the cost of electric power and overall mill and camp operating costs only increased by about 65% in response. A reminder that the focus should be on overall costs.
Sam Blakely is a geologist and cost analyst with Costmine, where Dave Boleneus is a senior geologist. Costmine is a division of Glacier Resource Innovation Group (www.costmine.com or firstname.lastname@example.org).