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543-S Copper Deposit: Mine Design & Trade-Off Study Keweenaw Peninsula, MI, USA

Department of Geological & Mining Engineering & Sciences 2015-2016 Mining Senior Design—Mine Innovation Enterprise (MINE)

Team Members: Ben Kramka, Laura O’Connor, Carly Siko, Ben Pletcher, Paul Mueller Advisor: Dr. Paul van Susante—Department of Mechanical Engineering-Engineering Mechanics

Acknowledgements: Carlos Bertoni (Highland Copper Co.), John Larsen (Cementation)

Underground Mining Method

Overhand cut and fill chosen for first-choice mining method based on:

Deposit geometry is limiting; cannot apply mining methods exclusive to shallow or steeply dipping ore body

Option of using uncemented backfill for stope and drift stability as opposed to cemented backfill (more expensive)

Mining follows the ore body closely so less waste rock is mined, minimizing dilution

High cost due to explosives breaking up rock instead of utilizing gravity feeders; less ore is mined per blast, but more selective

Proposed Mine Design

Block Model & Cross Section

Designed in Maptek Vulcan Mine Planning software (Version 8.2)

Drill hole data from logged geologic drill core is input into the program to create:

Geologic wireframes for deposit geology interpretation

Orebody wireframe and solid triangulation, to represent the shape of the orebody

Cross-sectional comparison of the orebody with previous interpretations

Deposit block model, to estimate tonnage, grade and uniformity of the ore deposit

Numerous variables were populated into the block model to perform a mineral resource estimate,

as well as for analyzing multiple effects of the surrounding geology when performing the mine design

Economic Analysis

Open-pit area is analyzed phase-by-phase using benches

Underground area is analyzed by stope level using cost/length of

tunnel advancement

GEOVIA Whittle® was used as a starting point for the open pit eco-

nomic analysis

Equipment specifications, blasting patterns, and mining cost were

used to determine which phase/depth is most economic to mine to

Once an economic pit limit is determined for open pit mining to

cease, a starting point for underground mining can be established

Using this pit limit, a decline can be designed to end near the mid-

point of the remaining orebody

From this decline, access tunnels will be developed and connected

to stopes, where the ore will be exploited and replaced with backfill

The underground analysis takes into account:

Blasting variables

Equipment cycle times

Backfilling time and variables

Determines the most economic extent of the underground portion

on a cost per length of tunnel vs. value of ore mined basis

Mine Layout

An open pit mine would have a larger environmental footprint than an underground mine

For both open pit and underground portions of the mine, surface layout will be largely the same. Above-ground facilities in-

clude are listed in Figure 10 below

Open pit mine will consist of benches 7.4 meters in height and 3 meters in width with 7 meter wide catch benches every 3

benches. The haul road will have a maximum grade of 8.0% (4.57°) and an overall width of 12 meters (including safety berms).

All underground openings will have a minimum width and height of 6.25 meters and will not exceed a 20% grade. The under-

ground mine will consist of a decline leading to access tunnels which in turn lead to the stopes, where the target ore is mined

and backfilled with waste rock and/or cemented backfill

Environmental

Permitting will be conducted under the Natural Resources and Environmental Protection Act Part 632

Highland has not yet carried out environmental baseline studies, including rock geochemistry, hydrology and biology

Many key items are also unknown at this time and lack costing forecasts for basic prefeasibility assessment

Waste rock planned to be stored on site and will be studied for potential acid mine drainage

Discharged water from the water treatment plant must be monitored and tested frequently

Permitting for the large volumes of discharged water is required

Equipment

Equipment selected based on:

Daily tonnage of 1,000 tonnes/day

Location of vendors

CAT Mining, Atlas Copco, Sandvik, etc.

Underground equipment selected based on 5m

x 5m tunnel dimensions

Load, haul, dump (LHD) equipment based on

versatility between open-pit and underground

operations

Capital cost based on initial start-up needs and

subject to change throughout life of mine

Conclusion

The 543-S deposit has potential for an underground or open-pit mining operation, as well as a hybrid mining option

Economic analysis and trade-off study will help determine capital costs, operating costs, and optimal mining method

Unknowns are still present due to lack of environmental testing on-site

Overhand cut and fill is the most reasonable mining method for this type of deposit due to the potential use of uncemented

backfill (crushed waste rock)

The block model and cross sections correctly resemble G Mining’s previous studies concerning the 543-S deposit

Future Studies

An additional study concerning transportation of ore and tailings to the processing facilities at White Pine is being conducted at

Michigan Tech for Highland Copper within the Mine Innovation Enterprise

Environmental monitoring for the site and further testing on waste rock and waste water would be required for many years

after mine closure to monitor backfill stability as well as the competence of exploration openings

The return of copper mining back to the Keweenaw Peninsula would bring many high paying jobs to the region but would also

require community approval from local, state, and federal governments

Permitting for non-ferrous mines in Michigan is regulated under Part 632 and provides for stakeholder consultation

Background

Site located in the northern Keweenaw Peninsula near Gratiot Lake (Figure 1)

Consists of several hundred lava flows interbedded with layers of conglomerate and sandstone

Bedrock is basalt with a chalcocite (copper sulfide) orebody (unlike traditional native copper deposits)

Previous geotechnical and environmental testing and drilling occurred on site

Metallurgical, mining, and feasibility studies performed for the viability of the deposit

Scope of Work

Goal of designing and comparing mining methods and design for an open pit, underground, or hybrid mine (open-pit transi-tioning into underground)

Surface infrastructure and mine layout placement addressed based on environmental and physical constraints

General blasting sequence, equipment selection, and general cycle time analysis along with economic cost-time analysis

Assumptions

Production: 1,000 mT/day

90% Cu recovery

Cut-off grade: 0.9% (underground) & 1.9% (open pit)

Mining cost:

Overburden: $3.50/mT

Open Pit: $2.80/mT (additional $0.022/mT per bench)

Underground: $57.27/mT (ore)

No ore processing on site; ore shipped to concentrating facilities at White Pine

References

CAT Products for Surface Mining. Caterpillar Mining, Web. Oct. 2015.

G Mining Services Inc. NI 43-101 Technical Report, 543S Copper Project, Michigan, USA. 2014.

Golder Associates. NI 43-101 Technical Report on the Copperwood Project, Michigan, USA. 2014.

Figure 3 (Above, Left): Geology of the western Upper Peninsula of Michigan, the 543-S de-

posit is located in the northern tip, near Gratiot Lake (Edited from NI 43-101)

Figure 4 (Above, Right): Location of primary native and chalcocite copper provinces in the

Keweenaw Peninsula (Edited from NI 43-101)

Table 3: Equipment capital costs and quantity needed for the hybrid mining op-tion

Figure 10: Surface infrastructure layout for a hybrid or un-derground mining operation. If the operation was solely open pit, the cement plant would not be necessary

Figure 1 (Left): G-Mining’s cross section obtained from NI43-101

Figure 2 (Right): Senior Design Team’s cross section based on drill hole data designed in Vulcan

Figure 5 (Left):

Block model of ore body with proposed depth and location of open pit showing transition point to underground mining

Color transitions indicating increasing depth from surface

Open-pit mining would target high-grade shallow ore with underground mining targeting deep ore zones

Figure 6 (Below): Block model of the 543-S deposit

designed in Vulcan, different colors indicate different

copper (Cu) grade with the range of values assigned

in the legend

Table 2: Equipment capi-tal costs and quantity needed for underground mining option

Table 1: Equipment capital costs and quantity needed for open-pit mining option

Source(s): Figure 7 (Left): SME (1998) Techniques in Underground Mining. Society for Mining, Metallurgy, and Exploration Inc. Figure 8 (Right): NIOSH (2007) Proceedings of the CIM Conference and Exhibition, Montreal, Quebec

Figure 9: Google Earth view of the project site; cleared area is previous drilling location; water body is known as the Beaver Pond in environmental analysis

Hybrid Option

Description Quantity Cost (USD)

Haul Trucks 3 $2,250,000

Grader 1 $1,100,000

Scissor Lift 1 $350,000

Service 1 $315,000

Crane 1 $350,000

Water Truck 1 $75,000

Fuel Truck 1 $65,000

Utlilty Truck 3 $45,000

Ford F-150 4 $80,000

Ford SUV 2 $30,000

Plow Truck 1 $30,000

Gradall 1 $30,000

Loader 3 $2,550,000

Dozer 2 $2,600,000

Simba 1 $1,099,000

Cable Bolter 1 $1,450,000

Roof Bolter 1 $900,000

Jumbo 1 $1,150,000

LHD 2 $1,700,000

Minecat 2 $340,000

Scaler 1 $565,000

Charge 1 $425,000

Total Cost: $32,099,000