Residential revitalization

Backed by a committed new owner and a workforce dedicated to its success, the Fosterville Gold Mine has posted record annual production and continues to deliver industry-leading exploration results as it enters a new growth phase.

Mine manager Ion Hann makes no effort to hide his pride about the local workforce at the Fosterville Gold Mine. “I personally believe that Bendigo is the best mining town in Australia,” Hann says. “People want to live here. They want to have a residential type of lifestyle in this great part of our country. Everyone’s convinced that if we’re all out here trying to do our best, the success of this mine is in our own hands, and as long as this mine is successful, everyone can achieve what they want away from site. “Some of our employees have worked other places, but a lot of them have only ever worked here. They want to stay here. They’re hardworking people all trying to achieve their own life goals, and they want Fosterville to have a long future. As a result, they treat it as if it’s their mine. They’ve really bought into our strategies to increase productivity and efficiency, and the results are on the board.”

Fosterville Gold Mine

Fosterville Gold Mine is the largest gold producer in the Australian state of Victoria. The mine started production in 2005 and poured its millionth ounce in January 2016. Located 150 kilometres northwest of state capital Melbourne, Fosterville is expected to produce 140,000-145,000 ounces of gold in 2017 after producing a record 151,755 ounces at a mill grade of 7.55 grams per tonne and 90.1 percent recovery in 2016. That production also came at a record low operating cost of USD 420 per ounce.

Fosterville just posted record production of more than 150,000 ounces for 2016, the latest in a series of milestones for the mine located near the geographical centre of Victoria and 150 kilometres northwest of state capital Melbourne. Gold was discovered in the area in 1851, creating a boomtown of 40,000 within a year. Over the next century, the 3,600-hectare Bendigo goldfields produced 25 million ounces of gold before mining companies began building large underground operations. With its population today topping 100,000, Bendigo is among Australia’s largest inland cities and home to the vast majority of Fosterville’s 400 employees. In a national industry known for fly-in fly-out rosters, most of them live within 30 minutes of the mine.

A decade of delivering

Fosterville Gold Mine, Victoria’s largest gold operation, started production in 2005 as an open pit mine and poured its millionth ounce in January 2016. During 2016, the mine produced 151,755 ounces at a mill grade of 7.55 grams per tonne and 90.1 percent recovery – all mine records. That production also came at a record low operating cost of 420 US Dollars per ounce. When Fosterville commenced a transition to underground mining in 2006, life of mine was around five years. Strong exploration results have continually extended that. Mid-tier Canadian miner Kirkland Lake Gold acquired Fosterville through its merger with Newmarket Gold in November 2016. Newmarket’s aggressive exploration program led to discovery of new high-grade zones in 2015 and 2016, and Kirkland Lake plans to continue the trend to extend mine life, spending USD 45-55 million on exploration across its seven mining operations during 2017. “We had up to nine drills running in the last 12 months, which is I think as good as anyone else running around in Australia at the moment,” Hann says. “And as a result, we’ve been able to make some discoveries, some really high-grade, significant discoveries.”

<p>Kirkland Lake Gold’s Fosterville Gold Mine, Victoria’s largest gold operation, started production in 2005 as an open pit mine and poured its millionth ounce in January 2016.</p>

Kirkland Lake Gold’s Fosterville Gold Mine, Victoria’s largest gold operation, started production in 2005 as an open pit mine and poured its millionth ounce in January 2016.

Among the results announced in early 2017 at the Lower Phoenix Footwall included an intersection of 15.15 metres at 1,429 grams per tonne gold – more than 50 ounces per tonne – including .6 metres at 21,490 grams per tonne. Visible gold was present in many of the latest hits at both the Lower Phoenix Footwall and Eagle structures, which both remain open down-plunge. “This mine historically has been a four-and-a-half- to five-gram-per-tonne mine,” Hann says. “At that, we were just profitable and it was hard work. The grade’s heading north now and our grades are significantly better, but you’ve still got to run the mine as though it’s the medium-to-low-grade mine that it was originally. So your productivities and your efficiencies and what you’re doing, you know, the rules still apply. Hopefully, then, the higher grade just reflects in greater revenue off a similar cost base. It’s really important for us that sort of sustainability continues, because once you get a life, now you’ve got to do something with it. For us, we must continually get more productive. That’s a never ending journey.” Mine management have identified strategies to improve productivity and efficiency and implemented campaigns for improvement. To that end, Fosterville also improved its haulage fleet in 2016. “We had smaller tonnage capacity trucks, and for us it was about productivity, so we had to go to a larger size truck,” Hann says. “We don’t want to throw more bits of gear under the mine, we want to stay at the same number or reduce the amount of trucks we need, but they’ve got to be high capacity then.”

‘Genuinely a 60-plus-tonne truck’

Fosterville trialed a Sandvik TH663 for three months in early 2016, and impressive results led the mine to purchase the trial unit and two additional Sandvik TH663s to replace its aging 45-tonne trucks. “The trial went really well,” says Dave Capell, the mine mobile fleet foreman at Fosterville. “Reliability, the tonnage that we were carting, speed on grade, a lot less downtime – that all added up and made the truck the best option to buy.” The new trucks are averaging around 500 hours a month and 90 percent availability. “The TH663 is genuinely a 60-plus-tonne truck,” Hann says. “We average somewhere around now 61.5 to 62 tonne a load, every time. Operators are really impressed with the comfort levels in the truck, and the ergonomics within the truck. It’s a smart truck, so we were able to get live feed into the cloud essentially, and we can log on, go to the website, and I could log on now and tell you what all three trucks are doing as we speak. That was an important step for us to make sure that we’re staying up with the latest developments in technology, and the more and more automation you can build into the gear, the better.”

Mine maintenance superintendent Heath Guthrie says obtaining even more live information from depth will be vital in future planning. “We’ve been putting a Wi-Fi network in the lower parts of the mine so we can get more live data,” Guthrie says. “The more live data we can get up to the top, the more we’ll be able to see exactly what’s going on in the trucks. It’s still a new era we’re getting into it, but hopefully moving forward we’ll be able to start using that live data in our day-to-day activities.” The new fleet of Sandvik TH663s has been delivering lower diesel particulate emission levels compared to the mine’s older trucks, thanks to their Tier 4 engines. “As we get deeper, the management of the working conditions becomes even more important,” Hann says. “It’s ventilation, heat management, stuff like that. We’ve just gone past a kilometre deep. We like to think we’re going to get to two kilometres deep, but at that stage, the heat that’s generated at that depth is something that’s going to need to be managed. Reducing underground emissions any way we can is important.”

<p>Heath Guthrie</p>

Heath Guthrie

While the mine’s ore grade is increasing at depth, so is the length of each trip the haul trucks must make from a production area to the ROM pad. “Our trucks have an hour-and-a-half trip each run, so it’s definitely helped the production profile this calendar year, that’s for sure, having so many extra tonnes on the trucks,” Guthrie says. “It’s just all about efficiency and moving the most dirt.”

Exclusive processing

How Fosterville processes its paydirt once the trio of Sandvik TH663s haul it to surface is unique. After crushing, grinding and flotation, a bacterial oxidation process developed to pre-treat refractory sulphide ores and concentrates liberates gold for subsequent conventional cyanide leaching with fewer air emissions and energy requirements than conventional processing. Fosterville’s BIOX plant is one of only 10 such plants currently in operational globally and has enabled the mine to achieve record recoveries. Compared to conventional refractory processes, BIOX recovers more gold at cheaper capital and operating costs and with a reduced environmental impact.

Kirkland Lake Gold Ltd

Mid-tier gold miner Kirkland Lake Gold Ltd expects to produce as many as 525,000 ounces during 2017 across its seven underground mines in Canada and Australia. The mid-tier miner’s production is anchored from two high-grade, low-cost operations: the Macassa Mine Complex in northeastern Ontario, Canada, which set a record output of 175,167 ounces at 97.1 percent recovery in 2016, and the Fosterville Gold Mine in the state of Victoria, Australia.

“A lot of our gold is locked up in sulphides, so we use a mixed population of bacteria to feed on the sulphide and liberate the gold in order to extract it using the CIL process,” Hann says. “The BIOX circuit is essentially a life. They’re microbes, like those that live on sulphide vents on the sea floor, only in tanks. We probably run the most efficient BIOX plant in the world. It’s a credit to the guys here and we have a bit of our own home-grown technology that goes alongside that which we’ve patented, but the recoveries we get out of our BIOX plant would stack up against anyone in the world today.” For all Fosterville has achieved in a little more than a decade of operation, Hann and the rest of the mine’s management refuse to rest on their laurels.

“What’s happened at Fosterville over the last 10 years, everyone should be very proud of,” he says. “There’s no doubt about it. What we’ve been able to achieve underground isn’t earth-shattering, but what we do, we do pretty well, and need to keep improving, and technology has to be part of that. “We need smart equipment that’s able to talk, but for us it always is and always will be even more about our people. We have to ensure our colleagues remain fully engaged and able to perform at their best. We’ve got a high-class workforce that is committed to this mine’s success. They truly understand that they can achieve what they want to in life and in their careers by achieving the goals that this mine needs to achieve.”