Ideas & initiatives to
make your mine a survivor

Toronto Airport Hilton
Toronto CANADA November 10-12 1999

SPEAKER INFORMATION

Outline program Travel discounts Registration

KEYNOTE SPEAKER

James E. Carter, President & COO
Syncrude Canada

Jim Carter was appointed President and Chief Operating Officer of Syncrude Canada in 1997. He joined the company in 1979 as manager of overburden operations and held progressively more senior appointments, most recently as Vice President of Operations, before his assuming his current post.

Since joining Syncrude, Carter has played a prominent role in a variety of initiatives aimed at enhancing safety, reliability, production, unit costs and product quality. He has also implemented innovative continued learning initiatives within the company.

Prior to Syncrude, he worked for McIntyre Mines Ltd and the Iron Ore Company of Canada. Carter earned a Bachelor of Engineering degree in mining engineering from the Technical University of Nova Scotia, and is a graduate of the Advanced Management Program at Harvard Graduate School of Business Administration. 

CASE STUDIES

Newmont Gold's Gold Medal Performance Initiative

Mark Hart, VP Business Process
Newmont Gold
Denver CO

Abstract
Earlier this year, Newmont Mining Corporation, the world’s second largest gold producer, launched the Gold Medal Performance initiative. This innovative program is about change—managing it and benefiting from it. Gold Medal is a new approach to management, goal setting, performance rewards and employee communication.

In this presentation, Mark Hart, Newmont’s vice president of business processes and the leader of the Gold Medal Performance initiative, will discuss the components of Gold Medal, the philosophy behind it, how it is being implemented at Newmont, and the results to date.

Mark Hart, 49, joined Newmont in March 1999 as Vice President, Business Processes. Prior to joining Newmont, he served as Senior Vice President of Process Management for Cyprus Amax Minerals Company. 

 Hart holds a doctorate in mining engineering from the Colorado School of Mines.

Case study: Falconbridge

Warren Holmes
Senior VP, Canadian Mining Operations Falconbridge Ltd
Toronto ON
Warren Holmes was named Senior Vice President, Canadian Mining Operations earlier this year, and is responsible for planning and implementing of changes required to ensure the company’s competitiveness, including employee communication and involvement that are necessary for the initiatives’ long-term success.

An engineering graduate of Queens University, he joined Noranda Mines Ltd in Noranda, Quebec, and held a series of supervisory, management and technical roles in Noranda and the group’s gold operations, before taking a leave of absence to study for his MBA at the University of Western Ontario.

He rejoined Noranda in 1977, working at the Pamour Porcupine Mines Ltd operation, where he became General Manager in 1983 and Vice-President and General Manager in 1985.

Holmes joined Falconbridge in early 1986 as Manager of Mines; he was subsequently appointed Vice-President and General Manager at the Sudbury Operations in 1989, Vice-President and General Manager of the Kidd Creek Division in 1990, and President and General Manager of Canadian Nickel Operations in 1996,

He has won the CIM District 3 Proficiency Award and the CIM Past Presidents' Medal. He is on the board of the Ontario Mining Association, the Mining Association of Canada, and a number of mining research and development and community organizations.

Productivity initiative at Randfontein Estates

Richard Galloway
Mine Manager
Randfontein Estates, South Africa

Richard Galloway has spent over 20 years in South Africa's deep gold mines, and has since 1997 been mine manager Randfontein Estates; south division. He first joined the company in 1978 and has held positions as production manager shaft operations; and mine overseer, stoping and development  (narrow reef gold).

From 1988-95 worked at the H.J. Joel gold mine as section manager - sinking operations, in charge of shaft development and related construction plus stoping and trackless mechanized mining development. Galloway is a member of the Association of Mine Managers of South Africa, and was elected to its council in 1999.

You want to put that where? Sunshine's move to mechanization

Michael McLean
Mine Manager & Chief Engineer
Sunshine Mine, Sunshine Mining & Refining, Kellogg ID

Abstract
Since its discovery in 1884, the Sunshine Mine, located in Idaho’s Coeur d’ Alene mining district, has been one of the world’s leading silver producers. Underground mining has traditionally been performed using variations of overhand cut-and-fill stoping requiring timbered raise access from track levels driven from timbered shafts. In the mid-1990s, high labor and materials cost coupled with flat metal prices resulted in the decision to adapt diesel-powered, rubber tired equipment to narrow vein mining within the historic infrastructure.

Development to accommodate mechanized equipment began in the West Chance orebody in 1996. Since the introduction of mechanized methods, production has increased by 70% while net cash cost per ounce has dropped by 32%. While traditional mining retains a place in the operation, mechanization is the bridge to future economic success for the Sunshine Mine.

Michael McLean has more than 26 years of diversified mineral industry experience in both managerial and technical roles, principally in the mining of gold, silver, base metals and borate minerals. His experience includes exploration, project feasibility and start-up, underground mine design, development, production and environmental management.

He is the mine manager and chief engineer of the Sunshine Mine, one of the world's leading silver producers located in Idaho's Coeur d' Alene Mining District. McLean has also been mine and project manager of the Inco-Homestake Mineral Hill mine, and engineering superintendent of American Borate Co's Death Valley mines. He has held engineering and supervisory positions with the Bunker Hill Company, Brooks Mineral Inco, and Silver King Mines, and been a consulting engineer for Pegasus Gold's Diamond Hill project.

McLean received his BS degree in Mining Engineering from the University of Nevada, Reno.

A continuous improvement approach for cost reduction

Jack Elliott, Plant Manager
Continental Lime, Pilot Peak Plant
West Wendover NV

John Panos, President
Organization Counselors
Salt Lake City UT

Abstract
Mining companies are increasingly turning to continuous improvement to help weather the storm of falling commodity prices and otherwise tough conditions. It’s meant adopting the systems for seeking and bringing about improvement, along with the methods to meaningfully engage people toward that end.

The presenters will provide an overview of the key elements of continuous improvement, the approach used at the Pilot Peak plant and how this has helped the plant. They will expand on the use of Process Improvement Teams, a7n important part of Continuous Improvement by talking about how one team figured out how to reduce spillage by 90%. This will include how the team was chartered, what the team found, how they went about solving the problems as well as the results achieved.

John Panos is the head of Organization Counselors, a Continuous Improvement and Human Resource Management consulting firm based in Salt Lake City, Utah.

Mr. Panos’ most recent work has been in assisting mining companies in installing Continuous Improvement to improve effectiveness. His past consulting work has included helping organizations install Total Quality Management, the establishment of process improvement teams, starting up self-directed teams, and providing leadership development training. He also has been teaching for the University of Utah, Professional Development Division for the past 10 years. Before founding Organization Counselors in 1987, Mr. Panos was with mining and chemical companies. He is a graduate of DePaul University. He has been a speaker at a number of meetings of the American Mining Congress/National Mining Association and other mining groups. He also has had numerous articles on organizational subjects published in mining magazines such as Coal Age, Engineering & Mining Journal, and Mining World News.

Jack Elliott is the plant manager for Continental Lime’s Pilot Peak plant in West Wendover Nevada. He started with Continental 35 years ago in an hourly paid position and after 10 years, began handling supervisory responsibilities. He has worked at a number different plants for Continental and has helped start up several facilities. For the past 15 years he has been in Plant Manager roles. He has a first hand understanding of how things work in a production setting.

Outsourcing everything

André J. Douchane
Vice President of Operations
Franco-Nevada Mining Corp
Vancouver BC

Abstract
The Ken Snyder Mine is the newest high-grade gold mine in Nevada. The mining operation is owned by Franco-Nevada Mining Corporation Inc. and it is 100% contract operated. The presentation will explain the company's reasoning for choosing to completely out source all aspects of the operation. Specifically highlighted will be the business philosophy behind the operating contract, the partnerships with the contractors, and a current evaluation of the results.

André J. Douchane is Vice President of Operations for two companies that will soon formally merged to become the Franco- Nevada Mining Corp Ltd). He was from 1991-95 Vice President of Operations, with worldwide responsibilities, for Battle Mountain Gold, and was before that Vice President and General Manager of Round Mountain Gold Corp. He spent the early part of his career with with Asarco in various engineering, supervisory, and management positions, after earning his mining engineering degree at New Mexico Institute of Mining and Technology.

THE CONSULTANTS

Managing a cost reduction program

Bruce Cavender, President
Advanced Operations Mgt Inc 
Tucson AZ

Over the last 20 years, Bruce Cavender has worked in operations, engineering, and management for Asarco, Round Mountain Gold, Magma Copper, and BHP Copper. He also held finance and purchasing positions at Hewlett-Packard and Cray Research. One of two candidates for the 2002-03 presidency of the Society for Mining, Metallurgy, and Exploration, he has published numerous papers on operations management, finance, and planning topics.

Cavender has a bachelor's degree in metallurgical engineering from the Colorado School of Mines, and an MBA from the University of Arizona.

Creating & sustaining a cost management culture

Larry Dyer, President
President, LMD Consulting

Abstract
"How do I get my organization to continually manage and control costs?" Well, the solution often begins with mangers. And, that is often why continual cost management and control never happens.

Managers fail to build organizations that continually control costs for a variety of reasons, including:
1) "I know this new program will work, even though the 30 prior to it failed"
2) "I’ll force them to manage their costs
3) "My department heads are responsible for controlling costs"
4) "I’ll setting up benchmarking committees to find out what others do, develop more report and better reports, I’ll hire someone to be the cost management czar, I’ll fire people that waste money, I’ll………"

We will discuss what management must do to develop an organization that continually manages and control costs. We’ll cover how to build a work environment in which everyone owns cost control. We’ll distinguish when managers need to lead, manage, follow or get out of the way. We’ll look at what systems need to be developed and aligned so that everyone habitually, every day manages and controls costs. Finally, we’ll learn it is not for the faint hearted or those afraid to take risks or uncomfortable in learning about themselves.

Dyer is President of LMD Consulting, a change management firm noted for enabling leadership to build and sustain the capability to generate superior results. He is also a senior consultant for University Associates and a Lead Facilitator for Pecos River, the change management division of AON Consulting.

As a professional with over 25 years experience in mining, banking, and manufacturing, he has been involved in organizational development throughout his career, as line manager, and as process consultant. 

Dyer earned a masters in organization development at Pepperdine University. 

Mine modeling for bench-marking and cost analysis

mjfarrel.jpg (8263 bytes)Michael Farrell, Principal
World Mine Cost Data Exchange
Australia



Abstract

Graphical representation of the relationship between production rates and mine operating costs has long been used to provide a quick reference for mine scoping studies, pre-feasibility analysis and bench-marking. This technique, developed by O'Hara and others, is typically based on survey data for one historic time period and can rapidly become dated.

Using financial models of up to 200 major mining operations around the world, these curves can be continuously re-estimated on the basis of current costs and current mining practice to provide a useful guide to tonnage and cost relationships valid for today. In this paper we present tonnage-cost curves for North American and foreign mines, based on 1998 actual and forecast 2000 data.

Michael Farrell is the principal of minecost.com, a cooperative internet site where he maintains detailed financial models of nearly 200 of the world's major copper, lead, zinc, nickel, gold, silver, and iron ore mines. He was from 1989-96 a director of Australian Mineral Economics where he researched and wrote AME commodity reports on gold, silver, aluminum, lead, zinc, copper and heavy minerals, and co-authored reports of the iron ore, steel and nickel industries. He has also presented papers on various aspects of the economics of the minerals industry at conferences in Australia, Asia and North America.

Farrell is a double first class honors graduate in economics from the University of Sydney, and has taught there, and at both the Australian Graduate School of Management and the University of New South Wales.

Activity-based costing: A powerful tool for effecting change

Sean Dessurealt
University of British Columbia
Vancouver BC

Abstract
Hot in manufacturing 10-15 years ago, Activity Based Costing is just arriving in mining. This tool can help managers determine where to cut costs, and how cuts will affect overall performance. The paper will cover
-
Allocating overhead accurately
- Distortions in cost information

- ABC as strategic tool
- Tactical benefits of ABC, and
- Limits of ABC.
It will also present case studies of mines that have embraced a "grab bag" of cost cutting tools.

Sean Dessurealt is a PhD candidate at the University of British Columbia, expecting to have earned his degree by late 2000. Despite his academic interests, he was experience in a wide range of mining activity, have worked for  ICI Explosives; in engineering for Placer Dome at Les Mines Kiena; for Conwest as a laborer at Nanisivik; in mines research for Inco, and at Highland Valley Copper as part of research for his master's degree.

Dessurealt graduated from McGill University and earned his masters at the University of British Columbia.

Breakthrough operating cost reductions for global miners

John D. Campbell & Daniel T. May
PricewaterhouseCoopers
Canada

Abstract
Mining companies are achieving breakthroughs in operating cost reduction from an unlikely source: Technology and processes originally developed as support tolls in corporate merger integration.

Leading mining companies with highly skilled operations people have historically used operational benchmarks and best practices to drive cost reduction programs. What is often missing, though, is processes - a set of consistent, predictable instruments which bring the metrics and skills together, then manage complex cost reduction initiatives. It's that missing "process" that is now helping leading mining companies to make breakthrough in operating cost reduction.

John Campbell is the global leader for Physical Asset Management Consulting at PricewaterhouseCoopers.

He is a professional engineer in metallurgy and materials science, starting his career in the mining and mineral processing industry and working in production, maintenance, engineering and plant management roles. Since joining PwC 20 years ago, John has consulted world-wide in a variety of heavy industries on strategy, management and systems, particularly around life cycle asset management issues.

He is the author of the books Uptime: Strategies for Excellence in Maintenance Management (Productivity Press); Planning and Control of Maintenance Systems: Modeling and Analysis (John Wiley & Sons) and the MRO Handbook for Maintenance Spare Parts (PEM Magazine).

Daniel May is a partner in the Business Advisory Services Group, specializing in mergers and acquisitions, due diligence, deal structuring, valuation and post merger integration. He leads the Western Regional practice and is a member of the National Mining Group, working for both regional and national clients.  He has participated in more than 50 transactions in the last five years ranging in size from $1.0 million to $800.0 million.

Within the mining industry, May has performed projects for Cyprus Amax, Arco Coal, Rio Tinto, Golden Star Mining, Vista Gold, Amax Potash, Kennecott, Thompson Creek Metals and Horizon Gold. His industry expertise in energy and natural resources, manufacturing, telecommunications, and financial institutions.

May received his BS degree in Business Administration with honors from the University of Colorado. He is a member of the American Institute of Certified Public Accountants and the Colorado Society of Certified Public Accountants

Using supply chain management to reduce costs

George Attar
Andersen Consulting
Montreal, Canada

Abstract
A joint study by Andersen Consulting and the Australian Minerals Industry Research Association (AMIRA) of how 47 mining companies in both Australia and South Africa are managing their supply chains has shown that
- Mining companies have the opportunity to make further inroads into their cash cost and total cost profile by taking a different approach to managing their supply chains.
- A majority of companies believe that there is the potential to reduce total mining costs by more than 10%.
- For the larger mining companies surveyed, this would amount to a potential ongoing saving of between US $30 and $50 million per year.
- Mining companies also see the supply chain as a potential source of strategic advantage in terms of attracting capital, bringing to account new deposits, and achieving quicker integration of newly merged or acquired companies.
- The largest areas of opportunity are in Sourcing, Forecasting and Planning, as well as in developing complete Supply Chain strategies.

George Attar is an associate partner in Andersen Consulting’s Natural Resource practice and has worked to help his client create shareholder value through several major change programs including in the area of supply chain management.

He joined Andersen Consulting in Montreal in 1982 and has since worked with major companies in several industry sectors, including manufacturing, financial services, natural resource, and public sector companies. His client list includes Air Canada, Bombardier, Lafarge, Alcan, and INCO.

Atta has a Bachelor of Commerce degree with a major in Management Information Systems from McGill University.

Practical application of advanced maintenance strategies

J Michael Robichaud
President and CEO
Bretech Engineering Ltd
Saint John NB

Abstract:
During the past 15 years condition monitoring has evolved as a key opportunity to increase profits in a wide variety of industries. Vibration analysis is one of the most powerful condition based maintenance technologies, and the cornerstone of many predictive maintenance programs. It is also widely utilized for troubleshooting and fault diagnosis of machinery and structures. Integration of complimentary technologies, such as motor circuit testing and thermal imaging, have improved the capability and effectiveness of industrial condition monitoring.

From a management perspective, it is also vitally important that clearly defined objectives and strategies for implementation are developed prior to proceeding with a condition monitoring program. This paper will discuss key aspects of the successful application of advanced maintenance technologies.

Mike Robichaud is an expert in machine condition monitoring and vibration control. He is a licensed professional engineer with over 20 years practical experience, mainly in heavy industry. Since establishing Bretech Engineering in 1989, Mike has resolved numerous vibration problems for clients in the pulp & paper, oil & gas, mining, and power generation industries. Mike has also managed the development and implementation of condition monitoring programs at various industrial and commercial facilities.

Mr Robichaud has achieved Certified Vibration Specialist III. He is president of the Canadian Machinery Vibration Association and on the board of directors of the Vibration Institute. He is also a member of the Canadian Advisory Committee to ISO TC108/SC5 (Mechanical Vibration and Shock / Condition Monitoring and Diagnostics of Machines). Mike has authored and presented numerous technical papers and short courses on the subjects of vibration analysis and condition monitoring. Working closely with the Bretech Team, Mike has developed various specialized techniques, including In-Situ™ Roll Balancing and Score™ Maintenance Assessment.

Negotiating equipment contracts to save money and transfer risk

Kelly Walker
Kelly Walker Associates

Kelly Walker heads a consulting operation that specializes in the implementation of world-class fleet management practices. He has successfully negotiated over 3000 equipment purchase, rent/lease, parts, and repair transactions in a 21-year career that included holding various sales and marketing positions with Caterpillar, Komatsu, JLG, Clark, and Koehring.

His published reference and training manuals include Master of World-Class Fleet Asset & Labor Management; Master of Equipment & Business Management; Master of Outsourcing; and Master of Identification & Prequalification of Outsource Suppliers.

OUR SPONSORS

Maximizing value from existing resources

James Hackwood & Michael Lewis
Modular Mining Systems
Tucson AZ

Abstract
Utilization, availability, and performance factors drive mine capacity. Operational mine management and dispatch systems provide the means to optimize these driving factors through data collection, interpretation, and control; but all too often the data is not disseminated to the people who need it. This paper describes an approach to making the best use of existing information resources.

James Hackwood is business development manager for underground mining at Modular Mining Systems, where he is responsible for the development and evolution of Modular's mine operations management systems for underground mining. Prior to joining Modular, Mr. Hackwood was involved in various roles with technology firms focused on underground communications, mine equipment teleoperation, autonomous guidance and automation.

He is a graduate of Queens University, Kingston,  Ontario where he earned a BS in Mining Engineering and an MS in Mining Engineering.

Michael Lewis joined Modular Mining Systems as a specialist mining engineer in January 1999, and is responsible for managing special projects and advising mines on mining and maintenance related issues,

He worked for Barrick Goldstrike from 1995-98, holding predictive maintenance positions in the drill and shovel, truck shop, remote condition monitoring, and process groups. He also worked in the mine engineering department as an ore control field engineer, and ore control supervisor.

Lewis graduated from Queen's University, Kingston, Ontario with a degree in mechanical engineering, and later earned a masters degree in mining. During his masters research, he concurrentlyworked  for INCO Mines Research as a project engineer.

Customer/vendor relationships in the new millennium

Ed McCord, Chairman & CEO
Komatsu Mining Systems
Vernon Hills IL

Abstract
An examination of experiences in other industries can provide insight on coping with the challenges of the depressed mining and commodity markets. What was happening 10 or 15 years ago in the relatively progressive oil, defense, and automotive industries may be a good indication of how the somewhat more mature and conservative mining industry will evolve. The presentation will focus on customer/vendor relationships and the implications of partnerships, risk sharing and long term agreements.

Ed McCord, Chairman and CEO of Komatsu Mining Systems, started his career at International Harvester in January 1973 and has been employed by IHC and its successor companies ever since. He has served in various marketing, engineering, manufacturing, and general management roles in the US and France (7 years). In April 1994 he was appointed President of Haulpak division of Komatsu America International Co. In February 1997 he was appointed Executive Vice President of Komatsu Mining systems, Inc. In January 1999 he was appointed Chairman and CEO of Komatsu Mining Systems.

He holds a BS in Engineering and Applied Science from the California Institute of Technology and attended graduate school at New York University School of Engineering and Science.

Reducing costs with AC shovel & haul truck drives

Walter Koellner, Marketing Manager, Siemens Energy and Automation
Alpharetta GA

Abstract
The primary design goal for any new piece of mining equipment is to minimize the cost per ton of material moved. This translates directly to design criteria for any electric drive system: Its technology and support package must allow a mining operation to minimize the production costs per ton of material. This means bigger payloads, faster cycle times, reduced maintenance, lower operating costs, more reliable systems, and more intelligent systems or, from a different perspective, higher productivity and increased profitability.

Walter Koellner is both marketing manager for special drives and project manager of Siemens' AC haul truck drive project. He joined Siemens' commissioning department in 1979, moved to the US in 1981, and has since worked on key mining-related assignments beginning with the start-up of the newly developed AC excavators drives with Bucyrus Erie.

In 1985, he joined the industrial systems division of Siemens Automation & Energy as systems engineer, leading a team that developed a new generation of AC excavator drives based on GTO inverters and digital controls. Koellner earned a Masters Degree in industrial electronics from the Technical University, Vienna, Austria, and an MBA from Georgia State University.

Fleet management systems: Essential tools for survival

Paul Richard, President & CEO
Wenco Systems
Vancouver BC

Abstract
Business survival requires the right information at the right time.  For open pit mines, this means having minute-by-minute status information from mobile and fixed pit equipment.  Fleet management systems are designed to collect essential data from mobile and fixed equipment in the pit, and to present this information to allow effective decision support.  The automatic dispatching feature optimizes the use of the fleet by responding to changing operating conditions.  Through effective monitoring and control of equipment fleets, major savings in operating and ownership costs can be realized.   A fleet management system is a pre-requisite to any attempt at re-engineering and cost management programs, and this presentation will address the specific opportunity areas where these systems can provide major savings.

Paul Richard became president and CEO of Wenco in 1997.  He joined the company in 1989 as an applications consultant and marketing director., and has since played a key role in directing the company's development toward meeting the needs of the worldwide mining industry. 

Prior to joining Wenco, Richard was vice president of IMS Electronics, a firm specializing in data and voice communications in underground mines, and dispatching of production equipment underground. 

Mr. Richard earned his Bachelor of Engineering degree from the University of Alberta and an MBA from the Executive MBA program at Simon Fraser University in Vancouver.