3rd annual global mining technology forum v3

3rd Annual Global Mining Technology Forum

6 - 7 June 2012, Hilton Sandton, Johannesburg, South Africa

Rafael Guzmán – Lead of Automation, Technology & Systems
Max Salas – Chief of Innovation Technology & Systems

June 2012
Mining Technology to Improve Competitiveness in the Business:
The state of art and future challenges in Codelco El Teniente
Copyrights © 2012 CODELCO-CHILE. Todos los Derechos Reservados. | Copyrights © 2012 by CODELCO-CHILE. All Rights Reserved.

Introduction
Chile in the World…

World
Population

756.000 0,15%
Surface
km2 Worlwide

17 0,24%
Population
millions Worlwide

317
0,4%
PIB PPA Thousand
Worlwide
millions


Agenda Contents

› About Codelco
› Overview and history about El Teniente
› Productive process
› The future is in the Land
› Main challenges
› Technology overview in the mine site management
› Extraction process
› Transport process
› General network strategy
› General Information management strategy

› Conclusions

About Codelco World leader in copper ore reserves…

4% Russia
Canada 1%
Poland 5%
3% Kazakhstan

United States 6% China 5%

Mexico 7%

6% Indonesia
Zambia 3%
Peru 12%

Codelco 10% Australia 4%
20%
Note: Other countries (13%) Chile: Others
Source: U.S. Geological Survey, January 2010


Codelco
Highlights

Based on Consolidated Financial Statements. 2009 and 2010
statements are also reported in conformity with the International
Financial Reporting Standards (IFRS).

(1) Includes minority interest (until 2008).

(2) Includes Codelcoâ€™s stake in El Abra mine.

(*) Provide services under subcontracts (Law 20.123).

Source: Codelco Report 2011


Codelco
Divisions

Source: Codelco Report 2011


Overview
El Teniente

› The most largest underground mine of copper in
the world, in operation since 1905.
› More than 103 million tonnes of copper in
geological resources and 35 million tons in
reserves for over 70 years of production.
› Daily production rate: 131 ktpd
› An integrated complex: mine-plant-smelt with U.S.
$ 2,700 million in fixed assets.
› Production 2011: 400 ktmf 9,6 ktmf


Overview
El Teniente: One century of continuous growth...

KTPD/DAY EVOLUTION OF DAILY PRODUCTION RATES OF SELECTED LARGE UNDERGROUND MINES Cota UCL
180 Borde cavidad 3200

160
REMOTE
3000
140

120 2800
MECHANICAL

100
2600
80
MANUAL Bingham Canyon

60 San Manuel 2400
Henderson
Climax
Andina
40
Kiruna Olympic Dam
Palabora 2200
Malmberget
20 Miami Premier
Freeport IOZ/DOZ
Source: E T Brown AC Freng FTSE Ridgeway
Kidd Creek
JKMRC and Golder Associates Mount Isa Salvador YEAR
0 2000
1880 1900 1920 1940 1960 1980 2000 2020 2040


Overview
Milestone’s in El Teniente History
› 1905: Start of operation (250 t/d)
› 1911: Expansion of plant to 3.000 t/d
› 1945: Block Caving
› 1970: Colón concentrator (70 kt/d)
› 1977: El Teniente converter
› 1980: Plan of mine mechanization (primary ore)
› 1989: Rockbursts
› 1991: Start SAG 1
› 1996: Completion of experimental plan Sub6
› 2000: Adoption to the expansion plan to 126 kt/d
› 2002: Adoption of automatic railroad (Esmeralda mine)
› 2003: Start the expansion (SAG 2)
› 2004: Adoption of semiautomatic LHD (Pipa Norte mine)
› 2005: Industrial tests of preconditioning
› 2005: Reached 131 kt/d
› 2010: Adoption of semiautomatic LHD (Pilar Norte mine)
› 2012: CI2TM – Smart center for integrated for decision making about
mine unit operations.


El Teniente Mine

Crater

Broken ore
Pipe
Surface

Diablo
UCL Esmeralda Regimiento
Level 2211 Esmeralda Pipa
91

Norte
UCL R. N.
Level 2120 Reservas Norte
140

Sur
Tte. 8 Pacífico
Level 1980
100

Andes Sur Norte
New Mine Level Andes Norte
Level 1880

Codelco Chile
Codelco Chile
Corporación Nacional del Cobre Codelco Chile - División El Teniente Copyrights © 2012 CODELCO-CHILE. Todos los Derechos Reservados. | Copyrights © 2012 by CODELCO-CHILE. All Rights Reserved.

El Teniente
Mine

PIPA

RESERVAS
QDA. TTE
NORTE
DACITA
TTE. 4 SUR
PIPA
NORTE
PACIFICO ESMERALDA
SUPERIOR
REGIMIENTO
PUENTE

NNM
NORTE

DIABLO
REGIMIENTO
NNM
NNM ANDES SUR
PACIFICO

NNM
SUR


Codelco
Trend about rate of accident with time losses per million of work hour (D.S. 40)


El Teniente Trend about rate of accident with time losses per million of work hour (D.S. 40)
8.0 5

SGSSO – Certificado bajo OHSAS 18001
7.0
4
6.0
Rate of frecuency D 40

5.0

N° Dead accidents
3

4.0

2
3.0

2.0
1
1.0

0.0 0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Dead' 3 3 2 2 2 3 1 1 1 1
D-40 Global 6.2 5.7 4.4 4.6 3.9 3.2 3.9 2.3 1.8 1.6

Año 2011 al 20.11.11


El Teniente
Main production process

Underground mine Sewell/Colon Concentrator Caletones Smelt

San Antonio Harbor

Mine unit operations Molienda y Flotación Smelting and converting

Copper concentrate Products
SX Cathodes Copper anodes
Mo concentrate RAF copper
Mine water Sulfuric acid
Production 2011 KTMF
Cathodes A grade 1.5
RAF 68.9
Anodes 238.2
Blister 23.9
Residue deposit Concentrate 67.5
Infrastructure & Supply Solid’s Total copper (own) 400.3
Copper (others) 2.9
Liquid’s Subproducts
Molybdenum (KTMF) 9.6
Sulfuric Acid (KTon) 1.151


El Teniente
Underground mining process

› Mechanized Panel Caving method.
› Leadership in hard rock mining under conditions
of high stress.
› Massive mining on primary rock from the '80s.
› Nine sectors in simultaneous operation, allow to
achieve a total production of 131 kt /d.
› Material Handling by LHDs, Trains (4 systems)-
Truck-Crusher-Belts-OP to a main transport system
(FFCC Teniente 8).
› One of the most automation Mine.


Mina El Teniente 2010
El Teniente Mine Site
General description
• Production capacity 140.000 tpd
• Ore grade 0,97 %Cut
• Active area 290.000 m2
• Incorporated area 75.000 m2/year
• Reserves in stock 110 Mton
• Horizontal development 25.000 m /year
• Radial drill’s 600.000 ml/year

• Work force 2.660 H
• Foreman’s 160
• Operation contractors 1200 H
• Productivity 54 tpd/HI

• Facility energy 35 MVA
• Energy consumption 4,8 KWh/tms
• CFM (Ventilation) 7 x 10 6 cfm
• Diesel consumption 0,128 lt/tms


El Teniente Mine Site
Main equipments
UCL
o Radial Jumbos 15
o Explosives truck’s 5

Extraction & Secundary reduction
o LHD 7 yds3 57
o LHD 13 Yds 3 12
• LHD Semi- autonomous 4
• LHD Manual 8
o Secondary reduction Jumbo 14
o Rock hummer’s
• Rock hummer (stationary) 6
• Rock hummer intermediate (semi-mobil) 82

Intermediate transport
o Railroad
• Locomotives 11
• Wagons 139
Trucks 7

Main transport
o Railroad Teniente 8
• Locomotives 9
• Wagons of 100 ton 54
• Wagons of 80 ton 130
o Railroad 5 Norte
• Locomotives 4
• Wagons

Primary crusher
o Principal crushers 3
o Jaw crushers 3


Agenda Contents

› About Codelco
› Overview and history about El Teniente
› Productive process
› The future is in the Land
› Main challenges
› Technology overview in the minesite management
› Extraction process
› Transport process
› General network strategy
› General Information management strategy

› Conclusions

El Teniente
Main challenges

› Goal: zero fatal accident › Consolidate mining method in primary rock, › Successful implementation of structural NNM › Build a new El Teniente, opportunity to
materializing the requirements about Project and Key Projects replacement; Dacite, innovate and made structural breaks. .
› Implementation and enforcement of Control incorporation rates of extraction area and P. Superior. .
Fatality Standards › Structural Project HR, organizational renewal,
speed.
› Facilitate implementation of the NNM and talent development, mean age with the
› Focus on automation of hazardous processes. › Recovering lost productive capacity of sectors proper management of the interferences. average of the sector and enhance the
› Implement standards for control the Pilar Norte and Esmeralda. . leadership.
› Effectively manage logistics and contractors
Occupational Diseases (silica, noise, arsenic) › Start operations with the open pit. workers while maintaining adequate working › Implement a systems for 12-hour shifts to
› NNM Project Outreach to the community, environment. . operate the South open pit
› Implementing a transformation management in
compliance with RCA and environmental RENO, TTE 8 and the Smelt. › Start operation of Southern open pit and begin › Improvements in quality of life: automation &
commitments.
the studies and development of North open pit. remote operation..
› Contractors decrease in operation and
› Environmental Qualification Resolution. increase productivity. › Project for development the Smelt


Technology Overwiew
El Teniente minesite

Process & Product

Grinding Flotation Dewatering Stock- Ship-
Transport
handling loading

Boat-
transp
Supervision Supervision Customer

Process control Process control

Ore reserves

Prospecting


Technology Overview
Under Cut Level
Production Level

Transport Level

Ventilations Sub Level

Trenes Automáticos

Main Transporting Level


El Teniente
Systems involved
PLANIFIC
Proyecto Exploratorio Teniente, Fase

Automate
LHDs

Automate Trucks / Railroad

Remote control reduction drilling
“JUMBOS”
Remote control PLATE FEEDER
Rock hummer

Conveyor Belts

Crushers

SCADA


Extraction process
Automine ®
System for automatic loading and transportation of ore in underground environments

Underground production zone Surface remote center

ACS

TCS

MCS

COMMUNICATION SYSTEM


Extraction process
Automine®: System architecture

System for maintenance System for production planning SCADA External
planning systems

Control
room
Operators Access control
workstation Mission control system system

Backbone
Network MineLAN Access gates
Production area


Extraction process
Application case: Pipa Norte Mine

System characteristic
• Semiautomatic cycle
– Automate transport
– Automate unload
– Load in a remote control
• 4 x Toro 0010 LHD semiautomatic
• Control room in surface
• One operator for 4 LHDs
• Condition monitoring
• Production monitoring
• Traffic control
• Production planning
• Production area is confined


Extraction process
Panel Caving –LHD for extraction

Load
ZANJA COLECTORA DE MINERAL

ZANJA

Transport

PUNTO DE
EXTRACCION GALERÍA DE PRODUCCION Unload


Extraction process

Benefits in the life quality for the LHD Semiatonomous operators
• Control room versus on board operation
• Better ergonomic and work environment
• Zero risk exposition and professional underground diseases

v/s


Extraction process

Productivity benefits
Less persons to LHD fleet operate
• For 4 LHD, we need only 1 operator.
• It’s 4 time less that the manual operation 1
needs.

2

3

4


Extraction process

Productivity benefits
Increase the effective time of work

• The autonomous LHD navigation principle let us maximize the work time per
shift.
• The diary operation hours can be increased in a 100% respect the traditional
operation.
• The interferences between the shifts does’nt exist.

At the edge, it’s possible decrease the LHD
fleet


Extraction process

Process management benefits
On-line information
This kind of automatic systems let us:
• Precise and real time information
• Visualize our operation in real time
• Production reports MEDIR  CONTROLAR   OPTIMIZAR
Mejoramiento
Informes de continuo Objetivo
Producción

Compartir
Seguimiento información en Planificación

 Operation management. tiempo real
Monitoreo de la
información Ejecución de la Misiones de las
de producción máquinas
Producción


Transport process
Introduction

• The Teniente-Codelco Esmeralda and Tte8 railway transport
system, one of the most modern in South America and the
only of its kind in Chile, is a fully automated system and is the
natural operate form for all person in the system. The
transport system is built up from the following sub-systems:
Train traffic control system, Ore level measuring systems for
the chutes, Remote control loading of the trains, Automatic
Train Operation, Automatic unload of the trains and Dynamic
measurement of load weight.


Transport process Introducción

General Overview El Teniente MINE

NIV. TTE. 3
5.000 Ton./Día MINA ISLA
4 4 Sur
5.000 Ton./Día REGIMIENTO 25.000 Ton./Día

A SEWELL
OP 15 Ppl. Esmeralda Mine
FF. CC. 5 SUR
FF.CC. 5 NORTE
40.000 Ton./Día
20.000 Ton./Día
Pipa & DIABLO
QUEBRADA TENIENTE REGIMIENTO MINA ESMERALDA
20.000 Ton./Día OP 12 OP 15 Br.
OP 13
OP 14
OP 16
FF. CC. Q.T Ten.6.

FF. CC. ESMERALDA Ten.6 6 RENO
SUB
Tte8 MainTransport Level OP 22 OP 23

PIQUES
25.000 Ton./ Día
LHD

XC 40-50-60
OP 20 OP 21 Ten. 8
OP 17 OP 18
A COLON

FF. CC. TTE. 8


Transport process
Train traffic control systems interflow

ATTM
System
Train ( L+C ) ATO
Prepared Automatic
System Transport Train
Management
ATP • Without Driver
System
• Automatic Train
Operation
• Automatic Train
Protection


Transport process
The modern system of control and automation of the railroad

Low
ATP Safety
Maintenance

Increase
Easy of Prod. Open
Expans. System

Automat. Adaptability Cost
Efficiency


Train traffic control system
Train dispatch centralized traffic control (CTC)

 System displayed with
exact train positioning and
updated object information.
 All events stored in the
system database.
 All information available Esmeralda Mine
for use by other systems

Tte8 MainTransport Level


Transport process

Stationary Train
ATTM

CTC Radio ATO
datalink
RBC ATP

INTERLOCK TIC

OBC


Transport process

• Operation - Security


Transport process
Conclusions

 Reduced Cost
 Moving block, together
with Cab signalling,
eliminates the need for
wayside equipment such as
signals and track circuits
 70% of Maintenance Cost


Transport process
Conclusions

 Improved Safety
ATP in all locomotives.
Supervised driver performance
with strictly enforced speed
restrictions
Eliminates human error in driving and
dispatching


Transport process
Conclusions

 Information and Fleet Adm.
 Real time information
 Production Management
Increment of Productivity for more
effective time of work
 Potential reduction of investments o
fleet


Transport process
Conclusions

 General conditions
 The automation of the FFCC is a technology implemented satisfactorily in the
operations of Codelco DET.

In our experience, the automation technology requires of new strategies of the
personnel's selection, besides relationships of help and with visions shared
between the suppliers and the client.

In the future the underground mining operations of transport will suffer more
demanding operation conditions, in technical terms and of manpower cost. It is in
this scenario where the automation of the FFCC appears like a highly attractive
option for DET.


General network strategy
Current Manufacturing Network Reality

• Silos information
• Limit visibility
• Don’t use IT Assests
• Limit escalability
• Safety risks


Connecting production areas

• Automatized process
• Real time information
• Visibility across the enterprise
• Cost efficiency
• Highly flexible and safe


Industrial network connect

• Create a standard collaborative
environment
• Provide visibility across the al
organization, suppliers, partner and
clients.
• Offer flexibility to manage the
operations.
• Give safety to the business
communications.

Complete sight of the industrial process
Relationship between the principals elements of the value chain (internal and external) to maximize the
efficiency and productivity


Trends in industrial networks

• Manufactures has the trend
to a common infrastructure: Switches L3
– Wireless / Routers
– Web-Based
– Security
Wireless Ethernet
– Unified Communications
/ Mesh Switches
– Ethernet (TCP/IP)
– Single platform

• Why?:
– Simple.
– Low cost
Ethernet
Controllers and
Gateways Web-Based
Hosts


Trends in industrial networks


Benefits

• Improve the productivity

• Improve the flexibility

• Improve the time response

• Increase the visibility


Convergence technologic ofthe networks

Many of the
manufacturers of
equipment are
implementing automation
and control protocols
based on Ethernet as a
replacement for
traditional field networks.


Convergence technologic ofthe networks


Global architecture: Ethernet to the Factory


Architecture Ethernet-to-the-Factory

Enterprise
Network

Demilitarized Separation between Control &
Zone Enterprise Networks
(DMZ)

Interconnection between Cell
Manufacturing Zones, Server Farms, and DMZ
Zone

Network Connection for
Cell/Area Controllers, HMIs, I/Os, &
Zone Drives


Future: Monitoring & control for optimize

Process IT Strategy - Overview Malstensficka

B-verket B146

Maln 3 M146
Mellanfickan
Maln 4 M147
B108
KR 3 KR 2

B102 B101 C-verket
Maln 5
MINES
B109

M119 8
Maln 6
D-verket

Maln 7
Pumps
Gamla ladan

6
B105
B160 B170 Ventilation
Elevators
M112-116
5

Monitor and Control Concentrator, M110-112
B103
4

3
B193

M170-173
2 1
Nya ladan

M160-163 Fire supervision
Mine and autonomous Mine Machines M104-109
2

1
B104
B191
Doors, Gates
View Production IT views Passage control
Nivåmätning (LT)
KR 4 KR 5
B190 Massflödesindikering (WI)
Massflödesmätning (WT)
Siktanalysmätning (AT)

B189
M190-193

Process objects Concentrator

OPC DA
Workplace
Workplace

Process IT
IPAK Minestar

Group IT or Separate Network
Engineering
Workplace Data flow
Aspect, Domain and Firewall
Conn. Servers Views
Workplace Bolis DWH CAD
Supervisors, Planners Mine Planning & Control
Plan mine and mine
Machines using Production IT

72

Sample of El Teniente minesite architecture


El Teniente
General Information management strategy

Our overall strategy for information management, focuses on 3 topics:
1. production flows
2. Infrastructure and Assets
3. Capital and Project Management

Integral management of Unit Operations and Business decisions based on global versus local
Key Services optima

Real time collaboration CI2TM® Assistance in decission making (forecasting)
Centers for
smart and
Communication and engagement between the integrated
decisions Synchronization between processes
areas

Transparency of the information Technology Standardization and Data Structures


El Teniente
We are currently building
our center in Rancagua,
where we expect in the
near future, maximize the
management of our
operations.


El Teniente


El Teniente

For our center, we want to smart
applications!


El Teniente
Architecture of our portal
End users

Aplicaciones TExxx
TExxx Devolpment
w2003
W2003 TExxx
W2003
Web Services
MISS
PGOM
PGOM
Site: Teniente
Site: Teniente
Site: Teniente
Módulos
Módulo
SSPM
GOHM
STCM

TExxx TExxx
Red Hat R5 .6 Red Hat R5.6
Oracle 11G Oracle 11G

BD
BD PROD SSBM_F2
MINCO
PGOM ADMSTCM BD
Site: Teniente Site: Teniente
Dispatch Devlopment
Transparent Gateway AdmSTCM
Text files Site: Teniente
PGOM
TExxx SSBM
Automine SSBM_F2
SQL
Server
DISPBD
Site: Teniente
Site: Teniente


El Teniente
Samples of our smart systems

Granulometric and Humidity view, that able us to
define areas at risk of mood burst.


El Teniente
Samples of our smart systems

We can generate easily and dynamic angles
of ore flow that may have a street, OP.

We analyze our extraction in
terms of real-time fleet


Conclusions Technology challenges for mining

 Safety:
 On top technology to real time control of seismic activity and develop early alarm criteria.
 Intensive use of automation, robotics and remote operations.

 Productivity:
 Automation and remote operations.
 Ci2TM: Centers for smart and integrated decisions in On-line way for Mines-Crush&Mill-Smelt-
Comercial&Logistic.

 Sustainability:
 The efficient use of water and energy, will be a mandatory in the use of new green technologies.
 Use of energies clean and renewables (Eolic, Geothermal, Sun, etc.)
 The environmental regulations will be more restrictive so the innovation and new technologies need to
provide solutions more efficient and competitiveness.

 Human Resources:
 Overall deficit of operation and management skills for lack of technicians and professionals for the mining.
 In Chile, in the last five years the number of mining workers is increased in 11,6%/year, and opposite to this
the professionals with academic degree in the geo-mining and metallurgy field is decreased in 6,4%/year.


Conclusions Technology general challenges for mining
 The growing demands on quality of life impose an additional challenge to the industry

 Competitive and sustainable management of underground mining in the future requires a constant effort in
incorporating new technologies, deepening and development of knowledge in mining massive deep, efficient
management of business risks and a better quality of life for persons.

 Innovation and technological development will remain a pillar for competitiveness and leadership in global mining.

 Forget about the much-discussed Internet of Things. The really interesting news is that data from a host of new
sources, combined with technologies that rapidly aggregate and analyze the data, will deliver fresh insights that can
give users much more immersive and valuable experiences online—and in the real world.

 CIOs and other IT leaders who get it—who grasp the importance of context-based connections—will be able to
establish themselves, and their organizations, as strategic players. They will immediately be able to offer new levels
of insight that will differentiate their organizations from competitors.

 Put simply, increased sharing of data through data services calls for a radical rethinking of how IT should handle
data management. Essentially, data management shifts from being an IT capability buried within application
support to a collaborative effort that enables data to be used far beyond the applications that created it.

 Nontraditional systems are now getting connected, exposing the organizations that use them in entirely new ways.
Organizations will have to make peace with the security reality of today and begin preparing their second line of
defense—data platforms—to mitigate the damage of attacks that get through


Conclusions Technology general challenges for mining

Knowledge management and
technology are increasingly
important

We need to work
today, in the process
developing the
technologies of
tomorrow and the
people who apply
them.


Rafael Guzmán – Lead of Automation, Technology & Systems
Max Salas – Chief of Innovation Technology & Systems

June 2012
Mining Technology to Improve Competitiveness in the Business:
The state of art and future challenges in Codelco El Teniente

3rd annual global mining technology forum v3

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