Water, Energy and Environment
The journey to green mining
Chile is currently experiencing its worst drought in six decades. The shortage of fresh water in its arid areas, such as the north, where the majority of copper production takes places, has grave economic, social and environmental consequences. Water is a critical component in mining operations, used in hydrometallurgical processes, concentrators, smelter and refinery, as well as other processes.
According to a Mckinsey report, the industry consumes enough water annually to provide for 75% of the Chilean population, and net freshwater consumption by copper mining is between 0.5 and 0.7 cubic meters of freshwater per ton of ore processed, with water held in tailings dams and its eventual evaporation and leakage one of the main reasons for this consumption, reported the Alta Ley Corporation.
As a result of the ongoing water scarcity crisis and the industry's high consumption, the Chilean Congress is discussing amendments to the Water Code to limit freshwater withdrawals. The mining industry is under pressure to decrease its freshwater usage and must seek other solutions such as desalination, reuse and seawater flotation.
"A primary concern is water scarcity. The country is at a turning point in matters of the environment, especially given the drafting of the national constitution. Projects have to be mindful of these risks and adapt their operations accordingly," commented Ivan Rayo, general manager of JRI Ingeniería, a Santiago-based engineering company working on Codelco's Rajo Inca. "The government is drafting policies regarding water to consider giving water rights a temporary character, restricting some uses, which will affect mining operators if implemented."
Miners using continental water sources will be constantly threatened, as the recent case of Anglo's Los Bronces has shown. According to the production report, Los Bronces' copper output decreased by 28% in Q4 of 2019, due to a 44% decline in the plant's processing capacity as a result of lack of water. It eventually came to an agreement with Codelco to use water from the tailings dams of the adjacent Andina mine.
Chilean miners are already concerned with declining ore quality. Now they must consider how to process a larger amount of ore while minimizing their water and energy usage, as the copper production matrix in Chile will change in the upcoming years and rely on the treatment of sulphide minerals which is an even more water-intensive process, according to Cochilco. However, another challenge is transporting water from the coast to high altitudes where most mines are found.
Are desalination plants the answer?
Chile opened its first desalination plant in 2003, in Antofagasta for human use. The leading mining operator in desalination in hile is by far BHP with its Escondida Water Supply (EWS) project, the largest desalination plant in the Americas. By 2028, there will be a total of 27 desalination plants in Chile and, by 2031, 47% of the water used in mining will be extracted from the sea, according to Cochilco. The Antofagasta region will have the highest number of desalination plants, supplying 66% of the copper industry's water consumption, followed by regions of the Atacama, Tarapacá and Coquimbo. The 15 desalination plant projects include INCO's complementary infrastructure project by Antofagasta Minerals, being also executed by Bechtel. This expansion project obtained Chile's first certified green loan for its construction, due to its focus on water efficiency.
Another upcoming desalination project, expected to be the second-largest in the country, is Codelco's US$1 billion desalination project to supply Radmiro Tomic, Chuquicamata and Ministro Hales mines, in addition to its facilities in Calama. The tender for the project was reactivated by the end of 2020 when Codelco decided to reformulate the project.
Other plants under development include Collahuasi's desalination plant, which will have an initial capacity of 525 l/s, and Teck Resources' QB2, with a capacity to treat 1,300 l/s, being executed by a leading water treatment EPCM solutions provider IDE Technologies.
Desalination plants in northern Chile are built along the coast and water is transported using a complex pipeline system that requires non-corrosive piping. Jorge Donoso, the general manager of Techint Engineering and Construction who is working on the Collahuasi plant, explained that the company is witnessing an aroused interest in their pipeline services as a result of the industry's move towards desalination solutions. "We also see a trend towards sharing infrastructure among mining companies. For example, in the northern district of Codelco, there are three mines operating in the same area, and all three customers have agreed to invest in the same infrastructure to distribute water to all the mines. We believe that this is an excellent long-term and sustainable solution in terms of environmental impact and cost," he elaborated. A by-product of desalination is brine, which is released back into the sea. According to José María Guzmán, country manager of CDM Smith in Chile, desalination is part of the solution, another part is water recycling: "The environmental impact of desalination has been a focus for our firm in Chile, and our experience indicates that the impacts of desalination can be controlled and mitigated. For example, the correct discharge of salt using diffusers increases dilution rates and reduces the threat to marine biodiversity."
When it comes to minimizing water use in drilling, Tomás Buttazzoni, general manager of Technosteel highlighted: "Every drilling rig uses a significant amount of water a day. The use of a mud plant addresses this issue as it ensures additives are not polluting the soil and allows for water recovery, decreasing water use by 30%."
"Our experience indicates that the impacts of desalination can be controlled and mitigated. For example, the correct discharge of salt using diffusers increases dilution rates and reduces the threat to marine biodiversity."
José María Guzmán, Country Manager, CDM Smith
Even though desalination plants present a long-term solution, it is also a very costly one. The addition of seawater desalination plants to large-scale projects adds at least US$1 billion to the project's capex, or up to US$3 billion if it is as enormous as Escondida, in addition to high electricity costs to pump the water to high altitudes. Therefore, another way of limiting water usage is through recycling.
"Freeport-McMoRan prioritizes maximizing our recycled/reused water across all our operations. El Abra is no exception, especially given it is in an arid region near the Atacama Desert. Our water use efficiency (water reused/recycled) at El Abra averages around 94% annually," highlighted Joshua Olmsted, Freeport's president and chief operating officer-Americas.
McKinsey reports that in 2018, water recycling in mineral concentration in Chile averaged 85% for high performing mines and 75% for most mines. If recycling rates do not reach 85% at least, then at least four Escondida-sized plants will be required by 2028. Antofagasta Minerals is already making investments to use about 90% sea or recycled water from 2025 onwards, and Teck's QB2 includes significant mechanisms for water reuse.
Only a small fraction of the large volumes extracted is the target mineral, which is obtained after processing, leaving behind tailings that consist of other chemical elements such as reagents and ground rock with water. The tailings represent between 97% and 99% of the ore processed and are transported for storage in tailings dams. As mines extract higher volumes to find a high-quality ore, production of tailings is expected to double by 2035 in Chile.
According to the ministry of mining, Chile has 742 tailing dams in 10 regions, of which only 106 are active. Since Chile generates on average 537 million mt of tailings every year, different initiatives are being led by mining companies to find value in tailings, such as Codelco, for example, through its subsidiary Codelco Tech looking to identify traces of chemical elements such as germanium, gallium, tungsten, rare earth and others.
Tailings are also crucial in the reduction of water consumption and reuse, since huge amounts of water are trapped in tailings, so mining companies are investing in large-scale filters to recover the water and remove the impurities. The impurities pose environmental problems to surrounding inhabitants, especially since there is always a risk of tailings dams collapsing due to the broken retaining walls that result in flooding of adjacent land, which has occurred in the past in Brazil, Mexico, Peru and Australia.
As a result, mining companies are investing in sustainable and durable tailings management solutions. For example, Los Andes copper is using dry tailings in its Vizcachitas project. "The project's footprint will also be reduced as our tailings will be disposed of as a solid and will eliminate the need for a tailings dam," confirmed director of the company, Eduardo Covarrubias.
Even though a dry tailings option seems like the ideal solution, according to Dave Lawson, president of the mining and minerals at Wood, a dry stack tailings option is restricted by the mine's location and size. "Converting an existing mine's tailings management solution to dry tailings would have financial implications that would require investigation to ensure feasibility. Some of the equipment needed for dry stack tailings has to increase in size to respond to current market trends," he added.
Meanwhile, Mathiesen, an international group dedicated to the manufacture, marketing and distribution of specialty chemical products, sees great potential in supplying chemicals that optimize water recovery. “Given the unique chemical properties of mine tailings and the importance of its processing, the company plans to boost investment in water treatment,” commented Humberto Pasten, mining division manager of Mathiesen. “We are searching for new chemical products that are more environmentally friendly and improve the recovery of copper and other secondary elements.”
As Chile advances towards sustainable and green copper mining, it will elevate the tailings transformation sector as tailings management becomes a core focus. The government is also leading initiatives such as the National Tailings Policy announced in 2018, which considers permanent monitoring of active tailings dams and a comprehensive approach to inactive and abandoned dams.
"The desalination and the transport of seawater require large amounts of energy and increase operational costs for projects. Comminution is also an energy-intensive process. The industry is moving towards greater incorporation of renewable energy sources to address rising energy costs and sustainability issues."
Claudio Lesch, President South America, Ausenco
Over the next decade, the increased activity of concentration plants, the progressive decrease in mineral grades and an increase in mineral hardness will result in a significant rise in energy consumption for Chile’s mines, which currently represents around 8% of the operating costs. "The desalination and the transport of seawater require large amounts of energy and increase operational costs for projects," highlighted Claudio Lesch, president of Ausenco in South America, an Australia-based multinational EPC firm working with Mantos Copper, BHP and Teck Resources. "Comminution is also an energy-intensive process. The industry is moving towards greater incorporation of renewable energy sources to address rising energy costs and sustainability issues."
Therefore, electricity demand for copper mining is forecasted to grow by 34% over the next decade, from 25 terawatt-hours (TWh) in 2020 to 33.4TWh in 2031, according to Cochilco. To meet this demand, a generation capacity of 1,222 MW is needed. As a result, mining companies are shifting to cheaper and more sustainable alternatives. BHP is paying US$840 million to terminate its 2008 coal-fired energy contract with AES Corporation in Escondida and Spence. It will replace it with solar and wind power, which will reduce its energy costs by 20%. Meanwhile, Collahuasi signed clean power supply contracts with Enel and independent solar power producer Sonnedix. It entered into a long-term power purchasing agreement with Sonnedix for the delivery of 150 GWh per year, which represents about 12% of the mine's power requirements. Gold Fields is relying on a hybrid solution for its Salares Norte project, positioned 4500 m above sea level. The project will include a 16 MW diesel generator and a 9.9 MW solar generator, executed by Aggreko, a leading supplier of temporary power generation equipment. The extreme environmental conditions of the project were a deciding factor in the type of hybrid model to rely on, according to Pablo Varela, managing director of Aggreko in LATAM. "Aggreko saw diesel generation as the most reliable solution. We designed specific units for high altitudes to get the ultimate output and incorporated a hybrid solar system to reduce generation costs and emissions," explained Varela. The Chilean government is also actively engaged in promoting the move towards renewables. The Ministry of Energy, led by the Bi-Minister of Energy and Mining, Juan Carlos Jobet, will prepare a National Energy Efficiency Plan. "The industry is already switching from coal power generation to contracts with renewable energy providers, and we expect that more than 60% of the energy used in mining will come from renewables by 2023," highlighted Minister Jobet.
"Hydrogen power generation is receiving more attention, but I believe that this will only become fruitful in 5 to 10 years, as managing the fuel is still quite complex and very expensive."
Pablo Varela, Managing Director LATAM, Aggreko
An appetite for hydrogen
Under its renewable energy initiative, the Chilean government is also keen on elevating the so-called 'fuel of the future'; green hydrogen. The Australian government also announced a National Hydrogen Strategy and mining giants BHP, Anglo American Fortescue formed the Green Hydrogen Consortium to accelerate green hydrogen production and its application.
Green hydrogen is the process of sourcing hydrogen from renewable power sources such as solar or wind power. "The green hydrogen is then compressed and stored at high pressure to generate electricity and power equipment, including trucks and cars," explained Tomas Cruz, piping business line manager at Fast Pack, piping, spools and wear parts provider who is incorporating the use of hydrogen in its production process. "Five to 10 years from now, we expect to see a surge in the use of green hydrogen in mining sites."
The fuel can be used to store renewable energy to later generate electricity. Jorge Masias, managing director of Volvo in Chile, argued for hydrogen powered trucks, explaining: "The issue with the use of electric vehicles in mining is that they would require higher autonomy because they need to travel longer distances, so hydrogen vehicles are better suited."
Overall, hydrogen fuel can play a role in decarbonizing the mining industry. According to the German-Chilean Chamber of Commerce, the fuel has a 70% chance of replacing fossil fuels within the industry. However, even though hydrogen power generation is receiving more attention, Varela highlighted: "This will only become fruitful in 5 to 10 years, as managing the fuel is still quite complex and very expensive."
Image courtesy of Antofagasta Plc