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Implementing Sustainable Lubrication Improvements

Darryl GrayMatthew Grant

Starting Point- Turning This into This

Overview

• Background on Xstrata/EHM

• Starting Point

• Lubrication Process Improvement

• Benefits to EHM

Xstrata plc

• A major global diversified mining group • Headquartered in Switzerland • Listed on London & Zurich Stock Exchanges

• Top 20 in FTSE 100; S&P Europe 350 Index• Market capitalisation approx US$45 billion• Employs 43,000+ people worldwide

Ernest Henry Mining

•Located in NW Queensland, approx. 40km north of Cloncurry

•Copper/gold operation

•Employs over 580 people

•Began commercial production in 1998

•Open pit operation- final dimensions 1.3km x 1.3km x 570m deep•Produces 11 million tonnes of ore per annum•Seeking to extend operations past the scheduled completion of open cut in 2010

Ernest Henry Mining

EHM Concentrator

•Processes 11 million tpaof ore

•Produces approx. 115,000 tonnes of copper and 120,000oz of gold annually

•Single-line plant

•Employs around 90 people

EHM Concentrator

Major Equipment

•Gyratory crusher•Conveyor System•SAG Mill•Ball Mill•Vertical Grinding Mill•Flotation Circuit (rougher and 3-stage cleaning process)•Concentrate and Tailings Thickeners•Pressure Filter

Starting Point

• Lubrication-related failures common (30-40 hours per year @ $2000/minute)

• SAG Mill Gearbox replaced/overhauled on average every 12-16 months (cost around $500K plus up to 5 days downtime)

• Contamination levels (particles and water) off the scale

• Inappropriate lubrication management practices

LPIT Process

• Lubrication Process Improvement Teams (LPIT) were formed across Xstrata NQ in 2004

• Driven by central maintenance department with assistance from lubrication consultant

• Involvement from reliability engineers and lubrication technicians

LPIT Process Overview

1. Document the “AS IS”

2. Plan & Consolidate

3. Employ Resources

4. Manage and Review

5. Optimise and Re-Plan

1- Document “AS IS”

Lubrication Audit- 2004

Following areas were identified as requiring significant improvement:

1. Lubricant Application2. Lubricant Storage and Handling3. Contamination Exclusion and Removal4. Structure, Support and Education of Staff

(including sampling practices)

Lubrication Application- Use of (old) single-point Auto-Grease Lubricators

Lubrication Handling-Poor Handling of 1000L Pods

Lubrication Handling-Poor Handling of 1000L Pods

Lubrication Handling-Poor Filter Storage

Lubrication Handling-Poor Housekeeping

Lubrication Handling-Dispensing Facility/Use of 205L Drums

Lubrication Handling-Waste Oil

Contamination Management-Incorrect Breathers

Contamination Management-Water Ingress

As a further example of contamination management- during the audit, the Ball Mill Fixed Bearing oil circuit was contaminated with water, reaching levels of 27,000ppm and emulsifying

Contamination Management-Poor Mill Seals

Oil Sampling- Incorrect Sample Points/Techniques

Education, Structure and Support of Staff

• No full-time lubrication technician or reliability staff

• Use of three different labs for oil sample analysis

• No written lubrication standards

• No lubrication training

2- Plan and Consolidate

Set Standards-Cleanliness Targets

• Cleanliness Target for Gearboxes 19/17/14 (ISO:4406-1999)

• Cleanliness Target for Hydraulics 18/15/12 (ISO:4406-1999)

Set Standards-Contamination Control

• Portable kidney loop filters available to achieve the ISO targets on compartments

• Permanent kidney loop filters on all bulk lube tanks

• Water and Particle Contamination eliminating breathers fitted to all dispensing tanks, pods and drums.

• Oil dispensing manifolds fitted with (5µm Absolute Filters at Dispensing - Minimum)

• Inlet and outlet filters fitted to bulk lube installations (pods and tanks)

Set Standards- Oil Sampling and Analysis

• Oil sampling and analysis on all critical equipment with lube compartments

• Test criteria defined for each compartment type

• Live sample points fitted to all fixed and mobile lube compartments

• All people involved in taking oil samples trained

• Key maintenance people to complete oil analysis and interpretation training

Specifications Before (14/08/04) Present (6/10/04) TargetShell Omala F460 VG 493 484 460ISO Cleanliness >28/#/# 23/18/15 17/15/12Particle Size Distrib. (%)

(<10um) 84 96 80(10-20um) 12 3 20

(>20um) 4 1 0No. Particles of (>4um) 1,900,000 60,000 970Est. Life Extension 1 2.5-3.0 5.0 -6.0Water (Crackle or FTIR) <0.1 <0.1 Below SaturationFiltration (Nominal) 20um 20um On Target <20umOffline Filtration Trolley No No YesMachine Proactive Servicing - Seals, ect

No Start The Norm!

Measure and Compare with Targets

Lube Process Improvement Team

•Team Leader- Darryl Gray

•EHM Concentrator Maintenance Team

•Support from Maintenance and Central Engineering (Glen Croft)

•External Specialist Support (Wayne Dearness)

Training and Personnel Support

• All maintenance personnel to undertake 2-day lubrication and contamination management course

• All supervisory and management personnel to undertake 1-day lubrication course

• Key staff to undertake oil analysis and interpretation course

• RCM• RCA

3- Employ Resources

Employ Resources-People

• Full-time Reliability Officer

• Full-time Lubrication Technician

Alfa Laval Centrifugal Filter

Alfa Laval Centrifugal Filter

Alfa Laval Centrifugal Filter

Alfa Laval Centrifugal Filter

Alfa Laval Centrifugal Filter

Alfa Laval Centrifugal Filter

Portable Kidney Loop Filtration Trolleys

Mill improvements-Kidney Loop Filters

SAG and Ball mills oil cooler (580C to 450C)

SAG and Ball Mills heat exchangers

Desiccant Breathers-First Trial

Desiccant Breathers-Second Trial

New Breathers

New Breathers/Fill Points

Mill Improvements- New System

1000L Pods

Lube storage shed

Lube storage shed

Lube pumps

Lube pump

Dispensing valves

Oil Storage Tanks

New Sample Points

Cost- Setup

$354,000Total

$5,000Wear particle counter

$127,000Oil storage tanks

$50,000Lube storage facility

$52,000Alfa Laval centrifugal filter

$120,000Filter systems fitted to all lube systems and gearboxes

Cost- Ongoing

$120,000Reliability Officer

$272,000Total

$10,000Training

$16,000Running Costs (Filters, Breathers etc)

$120,000Lubrication Technician

4- Manage and Review

SAG FLT 1-8-04SAG FLT 12-1-05

CRUSHER 30-9-04 SAG FLT

Contamination Control-Alfa Laval

Contamination Control-Alfa Laval

Contamination Control-Water

17-7-04Sag Fixed1-2-05

17-7-04Sag FLT1-2-05

18-12-04Ball Fixed1-2-05

11-7-04Ball FLT1-2-05

Contamination Control-Water

OIL TYPE Shell Tellus 68

DATE 17/12/2004 21/12/2004 31/12/2004 6/01/2005 12/01/2005 20//01/05 29/01/2005

> 4 um Count 33396 19304 1541 37802 4727 7908 911

> 6 um Count 14502 7255 316 10737 1270 670 186

> 14 um Count 230 160 23 1107 140 13 13

Water Content ppm 130 85 169 122 144 115 78

ISO - 4406 22\21\15 21\20\15 18\15\12 22\21\17 19\17\14 20\17\11 17\15\12

CONCENTRATE FILTER HYDRAULIC POWER UNIT

Particle Size Analysis

05000

10000150002000025000300003500040000

17/12/2004 21/12/2004 31/12/2004 6/01/2005 12/01/2005 20//01/05 29/01/2005

> 4 um Count> 6 um Count> 14 um CountWater Content ppm

Filtering Buggy installed 17/12/2004 Filtering Buggy reinstalled 6/01/2005

Filtering Buggy removed 31/12/2004 100ltrs of oil added 20/01/2005

Quantifying Impact-Early Days

Quantifying Impact-Early Days

0

5000

10000

15000

20000

25000

30000

35000

40000

coun

t PPM

20 Jan 05 31 Jan 05 25 Mar 05 22 Jun 05 7 Jul 05 14 Jul 05 20-jul-05

Ball Mill Floating Bearing E332LU008 Trend

4 micron6 micron14 MicronWater

Quantifying Impact-SAG Mill Floating Bearing

Quantifying Impact-Ball Mill Fixed Bearing

Quantifying Impact-Vertical Grinding Mill

Quantifying Impact-Larox Filter

Finishing Point

Quantifying Impact-Contamination (SAG Mill Floating Bearing)

284842,39618/16/1231/8/06

3,8407,680122,88024/20/1930/10/04

Particles/mL(>14µm)

Particles/mL(>6µm)

Particles/mL(>4µm) ISO Codes

Sample Date

Contamination Removed:>4µm: 98.1%>6µm: 93.7% Equivalent to 59kg/day of particles>14µm: 99.3%

Estimated Life Extension: 526%

Quantifying Impact-Downtime

2004- 40 hours lubrication-related downtime

2005- 30 hours lubrication-related downtime

2006- 3 hours lubrication-related downtime

2007- 118 minutes lubrication-related downtime

Estimated saving: $3.2million in 2006

Quantifying Impact- Mill Gearboxes

• Each gearbox replaced only once since 2004 (for upgrade purposes rather than failure)

• Currently 18 months in service with no indication that replacement/overhaul will be necessary in the near future.

• Expectation is to at least triple life, possibly extend to 5-6 years.

• Estimated saving- $300-400k pa

Quantifying Impact-Oil Consumption

• Since 2005, lubricant and sealant consumption has decreased by approx. 18%.

• Saving- approx. $40k in 2007

• Achieved through fewer changes of oil-based on condition rather than time, use of oil storage tanks for mills

Return on Investment

Expenditure on improvements since 2005:• Setup: $354,000• On-going: $624,000• Total: $978,000

Savings since 2005:• Downtime: $6,500,000• Gearboxes: $1,000,000• Consumables: $65,000• Total $7,565,000

Return on Investment: 780%

5- Optimise and Re-Plan

Future Plans

• Senior Reliability Engineer- Sept 07• Maintenance Engineer- Jan 08• New Portable Kidney Loop Filter• New Alfa Laval• Contamination Control Improvements• Improved KPI Reporting• Review/Formalisation of Lubrication

Standards

Conclusion

• Lubrication improvements, in order to be sustainable, involve significant work and financial commitment

• The benefits outweigh the costs by a significant margin

Questions