October 2014 | Vol 4 | Number 7 | www.miningturkeymag.com
Mining & Earth Sciences Magazine
by
ISSN: 2146-9423
CEO of Atlas CopcoRonnie Leten Visited Turkey
What Happened in Soma?
Turkey Mining Report 2014 - By GBR
October 2014 1
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FROM THE EDITORTURKISH MINING SECTOR NEWSMINE OPERATIONS MANAGEMENT SYSTEM (MOMS), REVOLUTIONISE THE MINING INDUSTRY - Afrasia Mining
ATLAS COPCO’S CEO RONNIE LETEN VISITED TURKEY - Atlas Copco
GLOBAL BEST PRACTICES IN CYANIDE MANAGEMENT: THE INTERNATIONAL CYANIDE MANAGEMENT CODE (ICMC) AND TURKISH EXPERIENCE - Prof. Ata Akcil, Glenn Mills
SAFETY FIRST: COMPLIANCE OR CULTURE - Mustafa Kahraman
WHAT DOES THE NEW MINING LAW CHANGE?Şebnem Önder, Göknil Emdi
THE ROLE OF ‘PROCESS MINERALOGY’ IN IMPROVING THE PROCESS PERFORMANCE OF COMPLEX SULPHIDE ORES Professor Dee Bradshaw
TYRE MANAGEMENT - A MAJOR ASPECT OF UNDERGROUND MECHANISED MINING OPERATIONS - Alan M. Clegg
POTENTIAL OF PORPHYRY CU MINERALIZATION IN CENTRAL ANATOLIA - İlkay Kuşcu
WHAT HAPPENED IN SOMA? - Mining Turkey Magazine
TURKEY’S MINING INDUSTRY REPORT - Global Business Reports
Cover Photo
Atlas Copco CEO Ronnie Leten visited Turkey in early October and closely reviewed the developments in Turkey market, which they deem important.
Mining Turkey team was also invited to a special press conference during his visit. You can find the interview with Ronnie Leten on page 18.
October 2014 | Vol 3 | Number 7 | www.miningturkeymag.com
Mining & Earth Sciences Magazine
by
ISSN: 2146-9423
CEO of Atlas Copco
Ronnie Leten Visited Turkey
What Happened in Soma?
Turkey Mining Report 2014 - By GBR
October 20142
Soma disaster hit close to the heart. 301 miners died because of this terrible calamity. The incident took its place in the country’s history for being the worst-ever mining disaster of Turkey and it revealed how unprepared Turkey is to such emergencies and how it terribly fails to meet global work safety standards. A detailed summary of the disaster is compiled under “What happened in Soma”, free of criticism or discussion.
Since the disaster in May, Turkey has been especially working on workplace safety. The terms of the latest omnibus bill resulted in cessation of operation in many small and medium scale enterprises around Zonguldak, a region known for extracting the highest quality hard coal. As the underground mine fire is still burning, Soma investigation expert reports could not be concluded, however, we can say that efforts toward more severe sanctions and higher standards have been intensely continuing.
Authorities, especially the Ministry of Energy and Natural Resources is focused on specifying proper work safety regulations with the help of experiences acquired from mine tours abroad and suggestions of foreign experts invited. International standards and technological advances have been presented to the Ministry at workshops, in which Güner Gürtunca, a former executive at NIOSH in USA and a mining engineer who had worked in Soma basin, was also present. It should be noted that facilities must be kept able to continue their productions whithout compromising the safety standards. In this context, we, as Mining Turkey, decided to organize a seminar on New Mining Technologies and Maximizing Benefits by inviting one of our writers; Mustafa Kahraman, from University of Arizona and MISOM Technologies, to Turkey. We believe that this seminar, scheduled for October at Hacettepe University, will provide important contributions to the sector.
Preparatory periods of new EIA regulations and Mine Waste regulations are going through a similar course. According to the new EIA regulations, marble and natural stone miners will be processed the same as other mining facilities. Another change planned is to include prospecting activites in the same context of oil, natural gas and geothermal search. To consider these two fields that have different circumstances and conditions in the same context will bring extra workload to mineral prospecting that is already in decline due to the Ministry Circular; making it more challenging.
Some important changes are planned for Mine Waste Regulations, as well. In the Mine Waste Regulation draft, mine wastes are exempted from special waste status by adaptations from and with references to current Hazardous Waste Control Regulations and Regulations on Systematic Waste Storage, and it contradicts with 2008 “Regulations on General Principles on Waste Management”, which conformed to EU acquis. This will cause juridical conflicts and result in public perception of mine wastes to be hazardous wastes.
In our country, when applied and future legislations are being prepared, European Union Directives are taken into account. However, as we pointed out above, some of the bills in the preparatory period contain conflicts with EU Directives. In such conditions, hearing the representatives of the sector and involving the sector in preparation of new bills and regulations is of utmost importance for the future of the industry and to assure that the regulations are enforceable.
Production in our country persists despite lower metal prices and closed down facilities. However, Gold Miners Association have announced that the numbers are expected to be below production targets for 2014. All these make up a base for the notion that finding projects that will lead to production will become a challenge in the following years in our country, where especially prospecting is already struggling.
Editorwww.miningturkeymag.com
New regulations and new safety standardsO. Çağım Tuğ | [email protected]
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October 20144
Newswww.miningturkeymag.com
The Decline in Mining Exports Continues in AugustThe mining exports in August this year was down %4.27 with 382.9 billion dollars compared to the values of the same period of last year. With the total of 3 billion 160 million dollars, the sector’s export in the first eight months of 2014 was also down 5.63% compared to the same period of last year.Alongside the unrest in Iraq and the crisis between Russia and Ukraine, the decrease in China’s demand is also signed as the cause of this decline. Though the export to the US and the
UN countries rose, the down in China, Iraq and Russia was irrepressible.The total mining export to China in the first eight months of 2014 decreased from 1 billion 659 million to 1 billion 258 million dollars with a down of 24.14%. Turkey’s largest export market Iraq experienced a down by 5.98%. The export to Russia also declined to 14.94%.Besides these declines, the exports to India, The US, Spain and Holland rose by 73.87%, 11.81%, 44.31% and 44.22% in order.While natural stone exports in August
declined 8.59% with 163.8 million dollar compared to the same period of last year, the total export in the first eight months increased 0.62% with 1 billion 450 million dollar compared to the first eight months of 2013.Despite the significant decrease in major markets like China, Iraq and Russia, the increase in the US and India markets prevented the mining sector from a big loss.
September 2014
Turkey Builds a Remote Sensing Laboratory in AzerbaijanThe National Geological Exploration Service of the Ministry of Ecology and Natural Resources of Azerbaijan Republic (MGKX) presented MTA (General Directorate of Mineral Research and Exploration) a written application in September, 2013. Following this application, the Ministry of Energy and Natural Sources of Turkey
launched a joint programme with Azerbaijan to build a remote sensing laboratory in their country. The Minister of Energy and Natural Resources Taner Yıldız stated that, “Turkey - Azerbaijan Geological Remote Sensing and Technical Cooperation Protocol” is signed in February, 2014 on demand of Azerbaijan.
The acquisition and analysis of information on natural and artificial surfaces using satellite platform is planned to be carried out on an iron ore deposit in Azerbaijan. A satellite image on a specific field will be analysed, and the studies will be carried out by MTA specialists.
April 2014
Koza and Lonmin will Explore Minerals in IrelandKoza Gold Corporation’s London associate Koza Ltd. and South African Lonmin Plc.’s associate Lonmin Ltd. (Northern Ireland) signed a memorandum of understanding in May. According to the memorandum, Koza and Lonmin will operate gold
and silver mineral explorations in Northern Ireland.Koza Gold Corporation had announced earlier that due to the limitations and some practices in Turkish mining sector and within the scope of their long term targets,
they would focus on the foreign-based opportunities especially on the countries with established mining regulations. Thus, the company founded England based Koza Ltd. in January 28, 2014.
May 2014
Foundation Laid for the New Thermal Power Plant in SomaFoundation laid on March 19, 2014 for the new 510MW coal-based thermal power plant in Soma district of Manisa province. The Minister of Energy and Natural Resources Taner Yıldız participated in the cutting ceremony of this second thermal power plant of the region. Kolin Construction won tender for the main contractor in exchange for 153 million tonnes of coal production
last year. The period of contract was 30 years. The 510MW coal-based power plant project would be performed through Build-Operate-Transfer Model. The studies on determining the location of the plant, preparing of the project, and preparation of EIA report were completed. After the coal fields, which would feed the thermal power plant started production, and the
construction of the plant completed, the project would offer the district a range of employment area for directly 3,500 and indirectly 6,000 people. The authorities declared in their public statement that the new thermal power plant will be constructed with the newest technology approved and applied worldwide.
March 2014
October 2014 5
Gold Producers Paid Taxes Equivalent to 7 Tonnes of GoldMuhterem Köse, General Coordinator of Gold Miners’ Association joined PDAC 2014 in Toronto and in his statement to Anadolu Agency he noted that the gold producers paid taxes equivalent to 7 tonnes of gold this year and added, “Owing to this production, we earned an improvement both socially and economically. More than 30 thousand mine investors from 130 countries meet at Toronto each year. Investment projects that are worth 750 billion USD are on the table… We should ask ourselves,”Where does Turkey place itself in it?” Each year 40 billion dollars of new mine investments are made in the world.”
Köse stated that Turkey was still taking baby steps in mine explorations and added that the mine exploration drillings Turkey had made in the last 75 years was equal to Canada’s just 1.5 years of work. In his statement:
“Mining is a long term investment, which needs 10 to 15 years in return. Stability is the key to success for this long period. Otherwise, it is futile to expect for an investor to invest hundred millions of dollars for 15 years of future. Mining production in Turkey is inadequate. Our total mineral export cannot even afford the coal import. Turkey imported 302 tonnes of gold last year, and paid 13.7 billion dollars in
return. Whereas our gold production was 33.5 tonnes last year which meant 1.6 billion dollars. In the last 20 years, 2.5 billion dollars of investment was made in gold sector in Turkey, which made us the top country in Europe in gold production. This investment also offered an employment area for 6 thousand 200 people. This year, we have paid taxes equivalent to 7 tonnes of gold to the government. Owing to this production, we earned an improvement both socially and economically. The only way to narrow the current account deficit is to explore and extract our own mine. This is the best model for us.”
March 2014
Çayeli Bakır İşletmeleri Doubled Production Rates in 20 YearsFirst Quantum Minerals’ Turkish subsidiary Çayeli Bakır İşletmeleri, providing the 1/3 of the total copper production of Turkey, has doubled its production capacity which was 600,000 tonnes when founded. According to the company’s statement to Mining Turkey, since its foundation Çayeli Copper has contributed significantly to the country’s economy, and the total ore it has extracted up-to-date is 17,367,000 tonnes. While the company’s total copper concentrate is 159,513.5 tonnes, the total zinc concentrate is 88,341.3 tonnes annually. The company’s annual ore production capacity is 1.3 million tonnes today.
At the company’s event organised for the employees at Dedeman Hotel, Rize on March 7, the company gave the news of a female director appointed to the head of a technical department, which is a first in the company’s history. Proudly announcing the promotion of Maintenance Deputy Manager Gönül Uğultan to the position of Maintenance Manager, Çayeli Bakır İşletmeleri General Manager Iain Anderson said “Mining, which is dominated by employment of men, has now become a sector, which women can also work in”. Managing Director Iain Anderson emphasized
the importance of loyalty to corporate values, production and continuity of work in his speech at the event held on March 7. He said “The important thing is how rather than how much you produce to gain reputation. While providing benefits for our sector and our economy, producing in a safe and environmental friendly manner with respect for the society is our biggest priority as Çayeli Bakır. Thus, we survive and thrive by producing together. I thank all Çayeli Bakır employees, who have contributed to this development and their families”.
March 2014
Magnesit AŞ Buys an Enterprise of Cihan Group in ErzurumAustrian-based RHI’s subsidiary Magnesit AŞ. signed a contract with Cihan Group and purchased Group’s raw material production facility in Erzurum and its mining rights. RHI, the Austrian company specializing in producing heat-resistant refractory products, bought the raw material
facility and it’s mining rights for 30 million USD. RHI will also become liable for Cihan Group’s debts to 16 million USD considering the quality and the specialty of the raw material. The sale will be declared valid as soon as the terms of the contract are fulfilled.
The formal process is still ongoing and the facility located in Aşkale district of Erzurum has a reserve capacity of 85 million tonnes with a production capacity of 120 million tonnes. The purchase value of the facility is said to be 26 million euros.
April 2014
October 20146
In 2013, Eldorado Produced 397,000 Ounces of Gold in TurkeyIn 2013, Eldorado Gold produced 397,000 ounces of gold in Kışladağ and Efemçukuru mines in Turkey. As to the company’s statement, 2013
production of Kışladağ increased by 6% compared to 2012. While the production costs remain pretty much the same, the company esti-
mates 10% rise in their production for 2014.
March 2014
Coal Explorations in Turkey Proceed in 2014Turkey, targeting to increase the utilisation of national sources in energy, aims to enhance its coal reserves through the new explorations in 4 regions. MTA will provide 25,197 million liras to fund the explorations in 4 regions and 18 provinces. The total exploration network including the operations in Amasya, Çorum, Konya, Isparta, Afyonkarahisar, Ankara, and Muş will cost 10,565 million liras.Turkey owns 1.3 billion tonnes of hard coal and 13.9 billion tonnes of lignite reserves, of which 512 million tonnes and 13.4 billion tonnes, respectively, are proved reserves. The research project “The Improvement of Lignite Reserves
and Prospects to Uncover New Lignite Fields” was carried out in 2005-2102 by Turkish Coal Enterprises (TKİ) as the coordinator, General Directorate of Mineral Research and Exploration (MTA) as in charge and ETI Mine Works, Turkish Petroleum Corporation (TPAO), Electricity Generation Company (EÜAŞ), Turkish Hard Coal Enterprises (TTK), General Directorate of State Hydraulic Works (DSİ) as the contributors. The project leaded to a significant improvement in the reserves, thus helped the lignite reserves rise from 8.3 billion tonnes to13.9 billion tonnes in 2013. The Minister of Energy and Natural Resources Taner Yıldız said in his
statement that 11 new coal fields had been explored with 1.2 million metres of drilling in the past 8 years. According to Yıldız, these newly found fields added up 6.8 billion tonnes to the lignite reserves which meant a 82% increase in Turkey’s lignite reserves. “The studies about the conversion of lignite coal into electricity is in progress and we are planning to provide 1/3 of our electricity out of coal in 2023. With our total national coals converting into thermal power plants, we are aiming to reduce minimum 12 billion USD annually from our natural gas import” added the Minister.
March 2014
New Privatizations UnderwayHigh Board of Privatization has made new decisions regarding the new privatizations and they are published in the Official Journal. According to new ruling, Orhaneli Thermal Power Plant of Elektrik Üretim A.Ş. (EÜAŞ) is listed in privatization program and immovable properties of the plant are decided to be included in the scope and program of privatization.
High Board of Privatization also concluded to include Soma Elektrik Üretim ve Ticaret A.Ş. (SEAŞ) except its immovable properties, Tunçbilek Thermal Plant of EÜAŞ, Bursa Linyitleri Işletmesi (BLİ) of Turkish Coal Enterprises (TKİ) with their immovable properties into the scope and program of privatization.Board ruled that the certificate No. 79528 of TKİ and certificate No. 73012
of EÜAŞ and the mine fields are included in the scope and program of privatization.On the other hand, the Board demanded Soma A Thermal Power Plant to be excluded from privatization program and decided that privatizations of other plants and enterprises to be concluded by December 31, 2016.
August 2014
Taner Yıldız, Called for Investments on MarbleTurkey Marble, Natural Stone and Machinery Manufacturers Association (TUMMER) Board of Directors were guests at a meeting with Ministry of Energy and Natural Resources, during which Minister Taner Yıldız called entrepreneurs to invest in marble sector. Pointing out to 30% of 13 thousand mine operating licenses being natural
stone licenses, Yıldız stated that natural stone production increased from 1.5 million cubic meters in 2002 to 5.8 million cubic meters in 2013 adding that natural stone export also increased from 700 million dollars to 2.2 billion dollars.China receives half of Turkey’s natural stone export, said the Minister and indicated that Chinese investors have
started operating in the country. Specifying marble as the main exported product constituting half of mine exports, Yıldız invited all entrepreneurs interested in mining and natural resources once again to invest in the sector.
August 2014
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October 20148
Eczacıbaşı Esan Stands Out with Industrial Mineral ExportFounded in 1978 and has been providing high quality products with professional service since then, Eczacıbaşı Esan grows rapidly both in local and foreign markets. With it’s exports to more than 40 countries, Eczacıbaşı Esan’s contribution to the
country’s economy was awarded one more time by İstanbul Minerals and Metals Exporters’ Association (İMMİB). The company has been awarded two years in a row with the Association’s “2013 Stars of the Exports” 3rd prize in “industrial minerals” category on behalf
of Eczacıbaşı Ekom Foreign Trade.Founded to meet the needs of quality raw material for Eczacıbaşı’s ceramic plants, Eczacıbaşı Esan is now among the pioneering industrial mineral and metallic mine firms of Turkey.
March 2014
Turkey’s First Molybdenum Facility Made Its Official OpeningLocated in Tepeoba village in Havran district of Balıkesir province, Turkey’s first facility that produce both copper and molybdenum made its official opening by the Minister of Energy and Natural Resources Taner Yıldız on May 3, 2014. The mine which took place in our previous issues is operated by Kuzey Ege Bakır İşletmeleri, the subsidiary of Özdoğu İnşaat Ltd. who celebrates its 40th year in business.Kuzey Ege Bakır A.Ş. General Director and Vice Chairman Murat Kavak made the opening speech, underlying the remarkable role of mining and informing about the facility. In his statement, he noted that the company had the mining license for the area of 1.439 hectares, targeting to extract 17 million tonnes of copper-molybdenum.
Kavak added that with 235 people working in the facility, 40,000 tonnes of copper and 1,500 tonnes of molybdenum concentrate is being manufactured annually and ranking the first place among the mine exporters in Aegean Region, it is the first and only molybdenum manufacturer of our country. Subsequent to the studies carried out for the reserves, they were planning to put the potassium feldspar mine into use in August. Kavak said that this imported product from then on would be produced in their facility and be available for use in ceramic and porcelain industry of our country. The Minister of Energy Taner Yıldız also made a speech at the opening, “MTA has drilled 10,000 meters here and confirmed of a copper-molybdenum
reserve of 20 million tonnes. Public sector explores and the private sector operates. We import 80% of the copper we consume. New fields should be open to use in order to diminish the import. Our annual import is 1.2 billion USD. This facility will make a huge contribution to our economy. We receive complaints about the difficulties of getting mining licences due to applying to18 different institutions. We are now establishing a one step office. Our mining exports, which was 841 million USD in 2002 has now risen to 5.1 billion USD at the end of 2013. The gross domestic product rate of the mining sector was 2.6 billion USD in 2003, now it is around 12 billion USD. Our goal is to increase the export to 20 billion dollars by 2023.”
May 2014
5 Workers Lost Their Lives in Unauthorized Coal Mines in Mount Cudi in 15 Days Due to the illegal production in asphaltite mines located in Şırnak, which were functioning despite the earlier closure because of the lack of proper safety conditions, 5 workers lost their lives in 15 days (1 worker on June 4th, 3 workers on June 11th and 1 worker in June 18th). These mines in question had been shut down 6 months ago upon an order from the Turkey’s Social Security Institution, Ministry of Labour, and governorate due to lack of job security and social security conditions.
The former Chairman of Chamber of Mining Engineers Mehmet Torun stated that this asphaltite field, which was formerly owned by Turkish Coal Enterprises, was transferred to Şırnak Governorate in a royalty transfer tender. The governorate has given its operating right to a private company in a royalty transfer tender, and the company operated the mines through the subcontractors. Yet, these mines were shut down upon an order from the Ministry 6 months ago. Coal is illegally extracted in mine
shafts here today. It is really hard to prevent mining in these blind shafts. The 1,000-1,200 of unemployed young people in the locality work in these illegal mine shafts for 40-50 liras per day. No engineering rules are applied. There are no emergency gateways, no ventilation in the mines. The workers do not have any necessary equipments like safety helmets and gas masks.”
June 2014
October 2014 9
MNG Orko’s Transaction Completed with Amlib United Minerals for Its Liberian - Kokoya ProjectMNG Orko, founded in 2012 by MNG Group, whose business activities cover a diverse range of fields from construction, tourism, air carriage, and cargo carriage, to finance and energy sectors, announced the completion of the transaction with Amlib United Minerals to acquire its 90% stake (10% Liberian Government) in Liberian-Kokoya Project. Kokoya is an advanced gold exploration project owned and managed by MNG Gold through its
subsidiary MNG Gold Liberia Inc. situated in Bong County, located in Liberia. A total of 272 holes for 48,625 m have been drilled and 249 trenches for 7,069 m have been excavated to date. Serhan Umurhan, General Manager of MNG, commented: “I am delighted that the closing conditions of this transaction have now been satisfied so that we can focus our efforts on rapidly developing the potential of Kokoya, which stood still for a long
time due to lack of funds. Our aim is to create a new approach offering an employment opportunity with positive value for local communities and commencing production as soon as possible. Kokoya is the first step in the creation of MNG Gold’s asset portfolio in West Africa and Turkey; we will add further valuable assets to our portfolio in the near future.”
June 2014
Aegean Metals Group Provides Market Update on Turkish Exploration ProjectsAegean Metals Group Inc, a Canadian junior mineral exploration company operating exploration stage projects in Turkey and Chile, shares its market updates on Turkish exploration projects with its investors. The company announced that the exploration activities at Ergama Project in Western Anatolia and Hot Maden Project in Eastern Black Sea region continue to advance .The projects’ exploration activities are being managed by Teck Resources (Ergama) and Lidya Madencilik (Hot Maden).The company’s Ergama Project is located in Balıkesir province. Ergama is a high-sulphidation epithermal gold-
silver project, which was first explored by Normandy Mining in the 80s. The project is currently owned by Aegean, however, Teck Resources exercised a one-time back-in right on May 28, 2013, and is now required to invest 1,275 million USD in exploration at Ergama within 3 years in order to earn-in to a 51% interest in the property. The update covers that Teck continues its geological explorations within the contract. The operating explorations in Hot Maden Project, which is located in Artvin province, is continuing to be advanced by Lidya Madencilik through a joint venture signed in June, 2014. Lidya has the option to earn-in to a 70% interest in the Hot
Maden Project in return for a 3 million USD commitment of combined exploration expenditures and cash payments to Aegean over a 48 month option period.The site was first explored by Russian geologists working in the region before the foundation of the Republic, later on MTA and private sector has continued the operations there. Lidya’s initiating field activities in the site are focused on geological mapping for the drilling locations preparations.As a part of the joint venture agreements in both projects, Aegean reserves the right to claim product share from the operation.
August 2014
Elsan Electricity Wins Yatağan Thermal Power Plant TenderTenders regarding the privatisation of Yeniköy Yatağan Thermal Power plant and the immovable properties owned by Southern Aegean Lignite Enterprises (GELİ) were done in Ankara. Among the six companies, Elsan Electricity Industry and Trade Co. Inc. placed the highest bid of
1.091 billion USD in the tender and won the operation rights of Yatağan Thermal Power Plant. Centered in Denizli, Elsan Electricity is a member of Bereket Energy Group.The immovable properties and Yeniköy Thermal Power Plant owned by Yeniköy Yatağan Electricity Production Inc. (YEAŞ),
the movable and immovable properties used by GELİ were privatised as a whole through an “asset sale” method; related mining licenses and mining sites covered by these licenses through a “transfer of operating rights” method.
September 2014
Aldridge Minerals Annouced the Closure of 45 Million Dollars FinancingAldridge Minerals announced by a press release that they have closed the financing with Orion Fund JV Limited, an affiliate of the Orion Mine Finance funds in connection
with a US$10 million equity private placement which includes participation by the Aldridge’s two largest shareholders and a US$35 million bridge loan facility.
Aldridge has also entered into lead concentrate and gold offtake agreements with an Orion affiliate.
September 2014
October 201410
Investment Incentive Certificate Issued for Mazıdağı Phosphate PlantEti Copper Inc. received an investment incentive certificate for Mardin Mazıdağı Phosphate Plant that was shut down in 1993 due to economic crisis and that was handed over to TMC Enerji Yatırımları San. Ve Tic. A.Ş., founded in partnership with Eti Copper Inc/Park Electric with a tender in May 2011.
Planned to become operational in 2016, the plant is announced to receive an investment of 1 billion and 60 million Turkish Liras. The plant is expected to produce 437,760 tonnes/year of phosphate, 75,000 tonnes/year of ammonia, 650,000 tonnes/year of sulphuric acid,
150,000 tonnes/year of phosphoric acid, 325,000 tonnes/year of phosphorus fertilizer and 690.000 tonnes/year pyrite and iron dust. When operational, 606 jobs will be created at the plant.
July 2014
Nata Holding Purchased Çaldağ Nikel MineOwner of Çaldağ Nickel Mine, the largest nickel reserve of Turkey with 29.7 million tonnes in Turgutlu district of Manisa, Çaldağ Nikel Madencilik’s majority share was sold to Nata Holding. According to Trade Journal, the majority share of Çaldağ Madencilik, who had been the former
subsidiary of VTG Holding, was sold to Nata Construction in April, 2014.Ankara based Nata Holding is a conglomerate of companies in the businesses of project development and real estate investment, construction, international contracting services, concrete pipe and prefabricated
structures, cement and energy. Prominent in constructing sector, Nata Construction ranked 150th in the international construction magazine Engineering News Record’s 2013 Top 250 List.
June 2014
Altıntepe Mining Continues Its Operations for Production in OrduStratex International Plc, the exploration and development company focused on gold and base metals in Turkey and Africa, and its subsidiary Bahar Madencilik will manufacture dore gold in Ordu- Altıntepe with an investment of 162 million dollars. According to the news published in Dünya Gazetesi, Stratex signed a contract with a construction company in 2009 for the refinement
of Ordu-Altıntepe and Konya-İnlice projects, but the construction company declared its withdrawal from partnership in 2011. Following this, Stratex declared new partnership with Bahar Madencilik for Altıntepe, and resigned from İnlice Project.According to the February 2014 invest-ment incentive certificate statistics, Altıntepe Madencilik, founded by the partnership between Stratex and Ba-
har Madencilik, aims to produce 3,500 million tonnes of ore in a year from this investment. Out of this ore, 1,08 tonnes of dore gold and 1.24 tonnes of dore silver production is expected in a year. An employment area for 100 people is also among the marks men-tioned in the investment incentive cer-tificate of the company.
May 2014
Zenit Madencilik Obtained Financial Support for Kızıltepe ProjectZenit Madencilik, a joint venture company between Turkish Proccea Construction Co. and Anglo-Turkish mine explorer Ariana Resources, has announced getting an investment subsidy for Kızıltepe Gold-Silver mine, which is a part of Red Rabbit Project. The announcement declares that the company will benefit from the incentives in ways such as the vat exemption, zero customs duty,
government support for the employer’s national insurance contribution and credit interest. Ariana Resources’ Chairman Michael de Villers states that these supports are considered to be a sign of the government’s will for the growth and improvement of the mining sector .Zenit Madencilik also announces that it has got the full funding to bring its Kiziltepe Gold-Silver Mine into
production. 33 million USD overall credit agreement, inclusive of capital repayments and borrowing costs, completed with Türkiye Finans Katılım Bankası. 236,000 USD first drawdown completed by Zenit. Loan repayments will be paid over five years.
June 2014
October 2014 11
EIA Approved for Ağı Dağı ProjectMinistry of Environment and Urbanization has approved the Environmental Impact Analysis (EIA) for Ağı Dağı Project of Alamos Gold Inc.,
one of the important mining projects of the country. John A. McCluskey, President and CEO of Alamos, indicated it as an important step for the
company’s projects in Turkey and a sign of significance state puts on advancing the mining sector.
August 2014
5 Mining Companies are Among the Top 100 Exports Companies The top 1,000 exports companies of Turkey in 2013 were announced by Turkish Exporters’ Assembly. While the mining sector has its place in the list with 91 companies, 5 mining companies are among the top 100 exporters. Given data show that the top 1000 companies made 90 billion USD of exports, which forms 59% of the total 152 billion USD of exports in 2013. The rate of the foreign-financed companies on the list is 20%. This is declared as the highest rate of the last 5 years.The total net profit of the top 1000 exports companies of 2103 is 14.2 billion liras. The mining companies Tüprag and Eti Krom Inc. are placed among the top
100 exporters for the first time. The boom in these two companies’ export figures is remarkable. Governmental Enterprise and Eti Mine Works, the only authorised boron producer in Turkey, ranks 16th (15th in 2012) in the list with 790 million 353 thousand USD. Eti Mine Works is the 2nd company with the largest profit rate among the 1000 companies. It is also placed first among the exports companies in the mining sector.Following Eti Mine Works, the second mining company in the top 100 companies is Çayeli Bakır İşletmeleri. With an exports figure of 249 million 838 thousand USD, it ranks 42nd in the
list (38th in 2012).The third company in the list from the mining sector, Tüprag, enters the list for the first time in its history. With 189 million 277 thousand USD of exports, it ranks 63rd in the list (240th in 2012). Being the 4th company from the mining sector in the list, Eti Krom Inc. ranks 67th among the 100. Succeeds in entering the list for the first time, Eti Krom made 185 million 583 thousand USD of export in 2013. Eti Soda AŞ., which ranked 229th among the top 1000 exporters in 2012 leaps forward in 2013 with 138 million 174 thousand USD of exports, and ranks 97th.
May 2014
Park Electric’s 2014 First Half Report Announced Park Electric, operating in the mining and energy sectors, published its 1st half report. The company stated to raise a total income of 122 million lira in the first half of 2014; 109.5 million lira from the copper plant in Madenköy and remaining 11.6 million lira from the asphaltite plant in Silopi, Şırnak. Company’s income was 123.6 million lira in the same period of 2013 and it saw a 1% drop in sales compared to the first month of 2014.In the first quarter of 2014, Park Electric
has handed the Silopi asphaltite plant in Şırnak-Silopi over to Silopi Electric Inc., another unit of the conglomerate Ciner Holding, for 61 million TL and claimed to score a profit of 14.1 million TL from this transaction. The drop in income in the first half of 2014 is also attributed to not receiving the revenue from the plant following the handover.Copper sales income in the first six months of 2014 shows a 3% increase compared to the same period of previous year. Copper sales income in
the first month of 2014 is 109.5 million lira, it was 106.7 million lira in the first month of 2013.In Madenköy copper mine, 50,021 WMT of concentrate copper production in the first half of 2013 decreased to 45,618 WMT in the same period of 2014, resulting in a 9% decrease. As to the concentrate copper sales, 47,473 DMT of first six months of 2013 has dropped 10% in the first six months of 2014 and stayed at 42.634 DMT.
August 2014
New Drilling Results at TV Tower ProjectPilot Gold has announced several updates about its joint venture TV Tower Project during last 6 months. According to the latest press release, Pilot Gold has completed 13 drill holes to date at the Valley Porphyry, and has secured permits to drill test
most of the 1,400 m length of the zone. Recent drill highlights include: 0.63 g/t gold and 0.27% copper over 134.7 meters (1.10 g/t gold-equivalent (AuEq1)) in KRD016C and 0.41 g/t gold and 0.25% copper over 70.2 meters (0.83 g/t AuEq1) in
KRD018C. These latest results from step-out drilling extend copper and gold mineralization over an area of approximately 300 meters by 200 meters. Teck Resources currently holds 60% interest of the project.
June 2014
October 201412
The Top 500 Largest Industrial Organizations of 2013 were AnnouncedThe list of the top 500 industrial organisations selected annually by İstanbul Chamber of Industry was announced. According to the news, Tüpraş with 39,729 billion liras of product sales took place at the top of the list. Turkey’s 500 largest organisations increased their sales by 7.4% to 454,990 billion liras. The major companies were mainly from petrochemistry, automotive, and iron steel industry sectors. While Ford Automotive owned the 2nd rank in the list with its production sale of 9,714 billion liras, Electricity Generation Company ranked 3rd with its production sale of 9,263 billion liras. The evaluation was made considering the product sales. The mining companies and many sector related companies (cement production, concrete production, glass and ceramic industry) appeared in the list as usual. Turkish Coal Enterprises (TKİ) and Eti Mine Works placed among the top ranks. While TKİ’s net sales declined compared to 2012 (2,886,203,748 TL), Eti Maden’s net sales increased compared to 2012 (1,487,462,707 TL). The sales figures of TKİ were down 23.3% compared to 2012, and the organisation moved downward on the list from 15th (2012) to 26th (2013).While the sales figures of Eti Maden were up 9.5%, the company’s place in the list slipped one rank from 42 to 41. Though there was not a significant increase in the company’s production rate compared to last year, the increase in the sales figures was likely a result of the rise in the exchange rate of dollar.Tüprag Metal Madencilik rose 4 ranks to 63th in the 2013 list with a net sales of 1,152 billion liras. Due to these numbers, Tüprag rose 6.2% with its net sales in 2013 compared to 2012.Following Tüprag, Soda Industry Inc. ranked in the list on the 72nd place. The company moved upward 9 ranks in the list compared to last year with net sales of 1.71 billion liras (26.9% increase compared to 2012).Koza Gold Operations Inc., which had formerly ranked 72th in İSO 500 2012 list, fell to 82th in 2013. The company’s net sales figure was 981,771 million liras, with a 10.5% fall.One of the Turkey’s prominent mining companies, Eti Bakır AŞ. (Eti Copper Co.) ranked 103rd in the list with net sales of 765,428 million. Eti Alüminyum AŞ. (Eti Aluminium Co.), which was a member of Cengiz Holding like Eti Bakır AŞ. ranked 217th in the list with net sales of 409 billion liras. Esan Eczacıbaşı, Çayeli Bakır İşletmeleri, Eti Soda, Erdemir Mining, Park Termik, Soma Kömür İşletmeleri AŞ., Park Elektrik, Eti Gümüş AŞ. are also among the leading mining companies took place in the İSO 500 list. İmbat Madencilik (İmbat Mining Co.), Kümaş Manyezit, and Tilaga Madencilik are among the mining companies that had a rank in the list for the first time.According to İSO 5000 list, among the top 10 organisations with the biggest profit, there were 5 mining companies. Eti Mine Works ranked 4th in the list with 841,797 million liras. The sector based listing of the rest most profitable companies were as follows: Tüprag Metal Madencilik (669,449 million liras), Koza Gold Operations Inc., Soda
Ranking Ranking Net Sales TL
Turkish Coal Enterprises (TKİ) 26 15 2,212,592,358
Eti Mine Works General Management 42 41 1,628,735,733
Akçansa Çimento San. ve Tic. AŞ 61 75 1,164,214,836
Tüprag Metal Madencilik San. ve Tic. AŞ 63 67 1,152,515,050
Soda Industry Inc. 72 81 1,071.959,226
Koza Gold Operations Inc. 82 72 931,771,503
Çimsa Cement Industry and Trade Inc. 87 88 884,345,009
Paşabahçe Glass Industry and Trade Inc. 88 128 878,798,569
Trakya Cam Sanayii AŞ 97 105 807,951,976
Eti Copper Inc. 103 108 765,428,032
Nuh Çimento Sanayi AŞ 145 169 562,447,082
Limak Cement Group 146 155 552,823,953
Aşkale Çimento Sanayii T.AŞ. 163 168 516,837,788
Çimko Çimento ve Beton San. Tic. AŞ 171 200 497,404,726
Esan Eczacıbaşı Industrial Raw Materials 173 222 492,209,913
Çayeli Bakır İşletmeleri AŞ 181 157 474,430,373
Limak Batı Çimento San. ve Tic. AŞ 189 199 462,655,126
As Cement 202 208 426,398,497
Eti Soda Üretim Pazarlama AŞ 212 201 413,757,248
Erdemir Mining Industry and Trade Co. 216 160 410,379,738
Eti Aluminium Co. Inc. 217 - 409,020,025
Eti Krom Inc. 225 426 397,316,956
Votorantim Çimentos 227 246 395,366,644
Adana Çimento Sanayii Türk AŞ 231 284 389,622,063
Park Termik Elektrik San. ve Tic. AŞ 238 234 380,752,104
İmbat Madencilik Enerji Turizm AŞ 252 - 357,822,282
Trakya Yenişehir Cam Sanayii AŞ 254 265 350,908,372
Soma Kömür İşletmeleri AŞ 261 295 338,048,668
Nuh Beton AŞ 267 243 332,649,984
Çimentaş İzmir Çimento Fabrikası Türk AŞ 278 290 325,872,258
BATIÇİM Batı Anadolu Çimento Sanayii AŞ 281 311 323,428,914
Park Elektrik Üretim Madencilik AŞ 311 364 298,577,066
Konya Çimento Sanayii AŞ 331 346 284,470,475
Kümaş Manyezit Sanayi AŞ 333 - 281,786,710
Turkish Hardcoal Enterprises (TTK) 364 302 255,505,078
Tilaga Madencilik ve Sınai Yatırımlar AŞ 365 - 255,169,707
Ege Seramik San. ve Tic. AŞ 374 371 251,263,216
Bolu Çimento Sanayii AŞ 379 434 248,851,391
Seranit Granit Seramik San. ve Tic. AŞ 380 339 248,125,643
Eti Gümüş AŞ 381 241 247,489,170
Göltaş Göller Bölgesi Çimento AŞ 388 408 243,202,444
Adoçim Çimento Beton San. ve Tic. AŞ 408 432 231,985,268
Anadolu Cam Sanayii AŞ 425 198 220,802,620
Ünye Çimento San. ve Tic. AŞ 428 356 218,809,568
Denizli Çimento Sanayii Tic. AŞ 437 453 216,278,585
Traçim Çimento San. ve Tic. AŞ 445 427 212,060,920
Bursa Beton San. ve Tic. AŞ 458 - 205,921,893
Mardin Çimento San. ve Tic. AŞ 464 402 204,088,738
Table 1. Mining Companies and Mining Sector Related Companies in İSO 500 2013 List
October 2014 13
Ranks OrganizationProfit for the Financial
Year (TL)
1 EÜAŞ 2,569,101,706
2 TPAO 1,634,198,676
3 - -
4 EtiMaden Works 841,797,606
5 Mercedes Benz Türk AŞ 805,507,329
6 Philsa Cigarette and Tobacco Inc. 760,649,785
7 Tüprag Metal Madencilik 669,449,075
8 Koza Gold Operations Inc. 543,281,929
9 Soda Industry Inc. 523,414,008
10 Eti Copper Inc. 442,907,145
Table 2. “The 10 Most Profitable Organizations” in İSO 500 List
Number of Companies
Profit of the Financial Year (%)
Mining and Quarrying 16 32.3
Cigarette and Tobacco Manufacturing 4 28.4
Electricity, Gas, Ventilation Systems 14 14.5
Uncategorized Machinery Equipments Production
11 13.8
Other Non-metallic Products Production 40 11.8
Table 3. The 5 Sectors with the Highest Profitability Ratio (Public Corporations Included)
Number of Companies
Profit of the Financial year (%)
Mining and Quarrying 13 40.1
Cigarette and Tobacco Manufacturing 4 28.4
Uncategorized Machinery Equipments Production
11 13.8
Other Non-metallic Products Manufactur-ing
38 12.1
Furniture Manufacturing 3 11.8
Table 4. The 5 Sectors with the Highest Profitability Ratio ( Among 487 Private Corporations)
Industry, and Eti Bakır. As reported by İSO 500 list, the most profitable sectors were mining and quarrying in the profit based analysis. Considering the 16 mining and quarrying sector based companies, mining sector was followed by “Cigarette and Tobacco Manufacturing” with 28.4%, and “Electricity, Gas, Ventilation Systems” with 14.5%. Excluding the three public-owned
c o m p a n i e s (TKİ, TTK, Eti Mine Works), 13 private equities’ profits were 40.1%. This rate is five times the total top 500 companies’ profit which is 4.9%.The below-mentioned mine producers’ and 48 mining sector related companies’ (cement production,
concrete production, glass and ceramic industry) total net sales were 24 billion 432 million liras, which was equal to 5.3% of the total companies’ sales in İSO 500 list.
August 2014
Meetings Held with South Korean Firm for Huge InvestmentOfficers from a South Korean power firm has come to the region to investigate the utilization of the Afşin-Elbistan coal basin for a huge investment of 10-12 million USD to build a thermal power plant. Higher ranking executives of the power firms operating especially in the Arab world and East Asia have been frequently visiting to examine the field on site
and map out the investment plan in the light of their findings.Officers of the undisclosed South Korean firm held meetings with Afşin-Elbistan Lignite Plant Manager Ahmet Yaldız and had detailed information on the structure of the plant and lignite reserves in the region. Following the meetings with no media access, AEL Manager Ahmet Yaldız revealed some
information regarding the session and indicated that the meetings were not about privatization.Laying emphasis on the 12 billion US dollars of investment, Yaldız pointed out to the economic and social benefits of this investment in the region as new jobs will be created.
August 2014
92 Mines Closed in 201492 mines’ operations have been shut down in the January-July period of this year, due to critically unsafe conditions for employees, by Turkish Ministry of Labor and Social Security, Directorate of Labor Inspection. Labor Inspection Committee specifically focused on stone quarry and mining sectors where deadly work accidents
are more commonly occuring and systematically inspected the mines throughout Turkey.Upon determining that 92 mines were critically unsafe for employees between January-July of 2014, Labor Inspection Commitee concluded to halt the operations at these mines. Of these, 11 were operating in Edirne,
10 were in Zonguldak, 7 in Tekirdağ, 6 each in Ankara and İstanbul and 5 each in Kütahya, Kocaeli and Manisa. Said mine administrations were fined and subsequently monitored whether they protested the “closed down” ruling and they were reported accordingly.
August 2014
October 201414
Turmoil in Iraq Caused Uneasiness in Natural Stone Export Natural stone export to Iraq is negatively affected by the unrest in this country. Aegean Mine and Natural Stone Exporters’ Association Chairman Mevlüt Kaya stated that: “Iraq will be challenging for us this year, numbers of the first 6 months are troubling. I will give an example from my company; our shipment dropped down to 8 containers from 24. If the war continues as it is, the sector will face a serious bottleneck because Iraq is our second biggest market after Germany. Since the numbers are high, the effect will
also be big. As the market involves processed products, the loss of the sector will be higher.” The shrinkage of Chinese and Indian markets for natural stone export resulted in a 5.3% drop in Turkey’s total exports in the first half of this year, compared to the same period in 2013, despite a 6.2% value based increase. Aegean Mine and Natural Stone Exporters’ Association Chairman elaborated that this is a reflection of the increase in processed product exports.Indicating that Turkey exports its
natural stone with added value, Kaya emphasized it as a gratifying development. Kaya stated that economic stillness in China and India caused distress in the sector, however, the increase in processed product export have pleased the miners. Adding that there has been up to 14% increase in processed products, Kaya mentioned that considerable amounts of natural stone have been sold to countries such as South Korea, Singapore and Malaysia.
August 2014
Koza Gold’s 2014 First Half Report Announced Koza Gold Operations’ gold production increased by 14.8% to 176,627 ounces compared to the first six months of 2013 according to 2014 first half report published by the company. Company made 429.3 million lira income from this gold production and the numbers of the same period in 2013 were 153.836 ounces and 411.8 million lira. Average grade of total produced gold in the first half 2014 was 5.31 g/t, whereas it was 5.74 g/t for the gold produced in the first six months of 2013.The increase in gold production in the first six months of 2014 is
attributed to the increase in average gold grade processed in Ovacık plant, the increase in the processed ore amount after the increase in capacity at Kaymaz and to Himmetdede plant that became operational.The company holds 56 enterprises and 328 mining licenses throughout Turkey. Currently, four plants of the company have been producing gold and production rates per plants in the first six months of 2014 were as follows:Ovacık: 93,830 ounces of gold (7.54 g/t Au grade), 38,588 ounces silver (4.46 g/t Ag grade),Mastra: 16,200 ounces of gold (4.99
g/t Au grade), 11,814 ounces of silver (5.95 g/t Ag grade)Kaymaz: 62,886 ounces of gold (5.15 g/t Au grade), 31,821 ounces of silver (3.74 g/t Ag grade)Himmetdede: 3,711 ounces of gold (average grade not specified)According to Koza Gold’s declaration in May, Mastra plant operations were halted for lack of storage and usage permits of forest products and explosives. In addition, ores extracted from company’s Çukuralan, Çoraklıtepe plants are transferred to Ovacık plant’s production facilities...
August 2014
Eldorado, Alacer and First Quantum’s Latest Production UpdatesTurkey’s biggest gold producer Tüprag, a subsidiary of Toronto based company Eldorado Gold announced the production numbers of its Uşak - Kışladağ and İzmir - Efemçuku gold mines. According to the press release dated 31 July 2014, 1st half gold production in Kışladağ reached 144,055 ounces (approximately 2,000 ounces less than last year) and 52.003 ounces (approximately 6,000 ounces more than last year) in Efemçukuru. In June 26th, Tüprag recieved the
EIA approval for the expansion of the Kışladağ open pit mine throughput from its current 12.5 million tonnes per annum to a maximum of 35.0 million tonnes per annum.Alacer Gold announced their Çöpler sulphide project gold production numbers for the second quarter of 2014 with a press release dated 29 July 2014. According to the release, total gold production reached 49,795 ounces and the attributable gold production (reduced by the 20% non-
controlling interest at the Çöpler Gold Mine) is 39,836 ounces. The company also mentioned that they remain on track to meet previously released full-year 2014 production and cost guidance.One of the Turkey’s most important copper mining company Cayeli Bakır’s, a subsidiary of First Quantum Minerals, 1Q production numbers are 7,142 tonnes of copper and 9.791 tonnes of zinc.
September 2014
October 2014 15
DRA - Afrasia Consultancy and Engineering AŞ Joint Venture AnnouncedIstanbul, Turkey – DRA of South Africa and Afrasia Mining and Energy AŞ of Turkey have signed a Memorandum of Understanding to join forces within an immediate Joint Venture on all Projects and Project potential within the Afrasia operational footprint; namely Turkey, Turkic Countries, Balkans, Middle East, North Africa and Islamic countries.The intention is to merge the two businesses over a period to create “DRA Afrasia Consultancy and Engineering AŞ” and which intention was communicated and launched at The Turkey-Eurasia Mining Show in Istanbul, Turkey on 3rd June 2014. The new JV between DRA and Afrasia is to offer full Mining Value Chain advisory services, engineering solutions and project financing arrangements for the mining, energy and infrastructure sectors in Turkey within the above mentioned operational footprint.This merger will now provide sectoral clients with a single point of access for all of their advisory, technical, and engineering services, including Greenfield & Brownfields exploration, mining operations right through to mine closure in addition to energy provision, energy management and environmental services.“We are very excited at the level of the combined expertise and experience of DRA Afrasia can deliver. DRA Afrasia AŞ will excel at providing strategies, methodologies, best practices, technical, engineering and green field operations, engineering
and operational performance improvement services, training to ensure delivering practical ideas and performance driven solutions that produce measurable business benefits to the client companies as quickly as possible” said Michiel Van Niekerk (ZA), COO of DRA Global.“This merger is a major vote of confidence in the future of the Turkish Mining & Energy industries in general. The broadened capability offering in the new company gives Turkish sector investors and existing operators access to world-class and best-in-class services in all areas of mining value chain under one point of contact in Turkey for the first time, said Alan Clegg, Executive Chairman at Afrasia Mining and Energy AŞ”“Mr. Clegg went on to add; The areas of primary focus & value-add for DRA Afrasia will now cover (1) Strategic & Mining business advisory both Technical and Financial/Financing (2) Exploration Program design & management (3) Conceptual design and feasibility studies (4) detailed design and engineering (5) Customized design of processing plants and delivery of Modular Plants (6) Large-scale mining infrastructure design (7) Specialized winding/hoisting systems and shafts (8) Headgear design (9) Project and construction management (10) Commissioning (11) Contract operations of mineral processing plants. Basically providing the best industry service offering menu locally in Turkey and in the region”
About DRA Group:DRA (www.DRAglobal.com) is truly global company with its headquarters in Johannesburg, South Africa. It is one of the largest and most successful a multi-disciplinary engineering group that delivers mining, minerals processing and infrastructure services from concept to commissioning as well as comprehensive operations and maintenance services and also DRA is a private company owned by our employees which number over 3,300 people globally. DRA has an office in Toronto, Canada, which deploys industry and sector professionals to support projects in Canada and South America. Additionally, DRA has offices in Australia (Perth and Brisbane), India and China, which support regional and global projects.
About Afrasia Mining and Energy:Afrasia Mining and Energy AŞ, (www.afrasia.com.tr) provides complete solutions to the mining and minerals industry from green-fields exploration to mine closure. AFRASIA’s unique end-to-end services have been developed in-house and through strategic alliances, specifically to fulfil the needs of mining companies who require comprehensive technical assistance in exploration, project development and management throughout mining life cycle and value chain. To inquire about DRA Afrasia AŞ, please email [email protected] or go to www.afrasia.com.tr
June 2014
Tigris Resources’ Latest Updates on Turkish AssetsGold and copper exploration company Tigris Resources focused on South-eastern region of Turkey and on project development in western Turkey released a press release about the listing and capital raising. The Project updates on Gömeç, were also mentioned in the press release.
According to the press release, Tigris has executed a letter of intent with a view to listing its shares by means of a capital pool company transaction with Kirkcaldy Capital Corp, a Canadian TSXv-listed company. The listing and the concurrent capital raising will provide Tigris with the
financial support it needs to prudently develop its current project portfolio and take advantage of the opportunities tough markets and pivotal times such as these can often present.
September 2014
October 201416
4th International Mediterranean Coal Markets ConferenceThe 4th International Conference Mediterranean Coal Markets was held on September 15 - 16 in İstanbul. The conference focused on the importance of coal trading in Mediterranean countries, latest trends and innovations in the energy industry and coal transportation in the region. Coal production and consumption figures in Europe, Northern Mediterranean, Black Sea countries, coal trading dynamics in Pacific and Atlantic basin, benchmarking discussions on coal vs gas vs renewable energy, and the share of coal in energy and cement industry were the topics discussed at the event with Mining Turkey’s press sponsoring. The first day of the organization ended with a pleasant trip to Miniaturk and Bosphorus Tour.The conference started with Undersecretary of Ukraine’s Ministry of Energy and Coal Industry Yuriy Zyukov’s speech. How the critical phase Ukraine had been going through due to the unrest inside affected the coal trade was an awaiting question for the attendees. In his speech, Zyukov pointed the political and social complications Ukraine was dealing with and the effects of these problems on their country and the future effects of this on Black Sea region trade. He also informed the participants about the coal mining of Ukraine. According to the data given,
Ukraine’s coal resources are 117.50 billion tonnes on average. The currently operating reserves are 7.8 billion tonnes, out of 3.3 billion tonnes is private and 4.5 billion tonnes is state operated. Turkey with 1.2 million tonnes places the top in Ukraine’s coal imports. Turkey’s followers are Bulgaria with 0.9 million tonnes, and Morocco with 0.82 million tonnes.According to Yuriy Zyukov’s statements, Ukraine faced a down of 3.4 million tonnes in the production due to the unrest in the country. He noted that the damaged railways and ongoing conflicts made it impossible to reach 1.5 million tonnes of coal. As a result of Ukraine’s needs for different types of coal and the conflicts in the country, Ukraine called for long-term agreements.Several countries from Europe, Middle East, South Africa, North America and South America also spouted in the conference. One of the highlighted topics in the speeches was the high cost of coal energy usage. The highest cost in coal production was said to be come from mining facilities, followed by the transportation facilities which comprises one third of mining business, harbour fees, general expenses and coal preparation. In order the coal prices to be in profitable rates, 40 million tonnes of coal should be withdrawn from market. Whether China’s decrease in coal import was
compensated by India’s increased coal import and Korea’s output gap was among the discussed topics. Another issue discussed in the event was the clean energy challenge especially dominated by Germany to the coal market. Little less than 50% of the energy production of Germany in the last 3 years were via conventional methods, the rest was provided by sun, wind, biomass and wind. Natural gas systems preferred for eco-friendly usage also leaded to an effect on the coal prices. For the last 10 years, Poland had increased its coal import 3% to 21 million tonnes per annum. Even with this increase, the crisis in Russia and Ukraine, and the decrease in China’s and Indonesia’s imports slowed down the rise of coal prices which was expected to go up 90 USD limits hardly on October, 2016.Colombia targeted a more assertive and competitive place in the coal sector with the investments in river transportation, the new port, railway and locomotive researches. The spokesman from the USA pointed out that Turkey was the main metallurgical coal exporter of the States. In the hard coal exportation, Turkey was said to be the third country behind Morocco and Italy.
September 2014
Turkish - Canadian Trade Organisation Explores Mutual Investment OpportunitiesThe resource and energy-rich Western Canada is where significant activities are taking place in mining today. The Vancouver-based Turkish Canadian Chamber of Commerce has a mission to increase investment between the two countries to unprecedented levels. Founded by seasoned Turkish Canadian businessmen in 2009, the Chamber offers professional support services to Canadian and Turkish businesses. The Chamber is represented in Turkey by Mr. Akin Kosetorunu, Director for Turkey, who served as a commissioner for Canada for nearly 3 decades. The
Chamber recognizes that while Turkish entrepreneurs and professionals are especially interested in investment immigration services, most Canadian businesses generally express need for market research for Turkey and consulting services included in some membership plans. AdvantageBC, a statutory trade promotion organisation representing 150 high-profile exporters and financial institutions in British Columbia is a full member of the Chamber. According to BC Government estimates, the Province’s mega LNG project only will create a million new jobs within the
next 5 years, not to mention investment and employment opportunities for Turkish companies and manpower in British Columbia. The Chamber offers quality business services to Turkish and Canadian companies pursuing business possibilities in both countries.Turkish Canadian Chamber of Commerce has a website at http://turkishcanadian.org. Mr. Akin Kosetorunu, based in Ankara, can be reached via e-mail [email protected] and Phone 0533 244 8282
October 2014
October 2014 17
In the current world economic environ-ment, business strategies are to drive down costs, increase yields and mar-gins while at the same time maintain-ing their assets. New expansions and upgrades to existing facilities are limit-ed as companies are holding onto their cash reserves. This is more prevalent in the mining industry as commodity pric-es are under severe pressure, and the cost per mined tonne is ever increasing.
The biggest challenge for Mining Companies is to meet high demand by increasing ore throughput while maintaining quality. Thus, measuring downtime and identifying its causes are important contributions that MOMS (Mine Operations Management System) can make in the industry.
To this end DRA Projects (Pty) Ltd devel-oped its MOMS to enable Mining Com-panies to have better control over their supply chain, to have improved control and management of their Process Plants and to ensure that their assets are deliv-ering maximum efficiencies, utilisations and availability. MOMS delivers the right information at the right time to the right people to ensure that pro-active decision making is possible for Mine Management.
The availability of skilled operations and maintenance resources specifi-cally on mines in remote locations is a real issue that affects the profitability of mines. MOMS acts as an enabler by co-ordinating maintenanceactivities as well as guiding operations staff to avoid abnormal occurrences, and en-sures that the assets are used optimally and efficiently on the Process Plant.
The management of and efficient use of power specifically on sites where power generators are used is another benefit of MOMS; if the proper power meters are installed MOMS will deliver a complete power billing solution to our client. The management of water and the statutory
management reporting of the mine will also be handled through MOMS.
An additional benefit of MOMS is the inte-gration of production data into an organ-isation’s business systems (ERP). With the integration of the production and process data into the business systems the follow-ing corporate benefits are realised:
• Common Processes• Common Data• Single Versions• Common Reports• Benchmarking• Support Model• Standardisation• Supports structure for Global
Operating Companies• Supports governance Processes
MOMS covers a powerful combination of financial, distribution, costing, schedul-ing, maintenance and production tools that can be implemented as needed. One of the key components of MOMS involves an easy to use workflow-driven set of processes to manage procurement, production, budgeting, maintenance
and internal cost requisitions. Creating the reporting and input dimensions and frequencies allows for accurate costing at detailed process level and transactional analysis to the operations, responsibility centre and/or equipment.
Due to the remoteness of the majority of mining operations, and the constraints mining companies experience in their supply chain, MOMS delivers the visibil-ity to enable reduction in excess operat-ing spares, stock and consumables.
Finally, MOMS provides an organisation with various delivery options of KPI’s, including the delivery of information and process data any Internet Compat-ible Device.
Mine Operations Management System (MOMS), Revolutionise The Mining Industry
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Website : www.afrasia.com.tr
October 201418
“Every industry needs some equipment from Atlas Copco”. Even if it sounds extreme at first, the words of Atlas Copco’s CEO, Ronnie Leten, carry great substance. Describing Atlas Copco as a balanced and sturdy table on four legs, Leten states that the 4 important lines of business of the company, namely, Compressor Technique, Industrial Tech-nique, Construction Technique and Mining and Rock Excavation Technique, serves humanity in 182 countries in a wide array of services and products ranging from the production of daily technological gadgets to food pack-aging, factories, hospitals; from gen-erators to heavy mining machinery. Considering Turkey’s market to be very important, Ronnie Leten visited Turkey and shared his views of Atlas Copco and Turkey with us.
RONNIE LETEN EXPLAINS ATLAS COPCO’S PRODUCTS AND MARKETS1873 marks the year Atlas Copco start-ed manufacturing railway cars, which left their place to compressors, mining & construction equipment and pneu-matic tools in time, he states. “If we focus on the sales, it is globally spread; one third of the sales are in North and South America, more than one third are
in Europe and Africa and a bit less than a third are in Asia and Pacific” says the CEO indicating that Atlas Copco’s big-gest market today is US, even though it was China just two years ago. “China is a big market and we have around 7000 people working for Atlas Copco and 26 factories there”, he adds.
Leten proudfully describes preemi-nence of Atlas Copco by stating that throughout the world, about one-third of all cars produced are assem-bled using Atlas Copco tools. “Airbus’ wings are especially assembled by Atlas Copco tools.” Mobile phone pro-duction is another area where Atlas Copco is very dominant; “all the Sam-sung (phones) around the world are assembled by Atlas Copco products” says Leten. Atlas Copco is also domi-nant in the medical market since “50% of the hospitals in US are equipped with Atlas Copco medical systems” as specified by the company CEO.
“Atlas Copco family consists of 44,000 people around the world and our en-gineering centers are based in Swe-den and Belgium. Design and devel-opment are performed in India and China, as well, because these markets are becoming more and more impor-
tant and we want to be more com-petitive there.”
Ronnie Leten shares his view of future energy solutions as follows, “For the fu-ture, I think everything will be focused around environmental energy that will not stop. We still do not know about the solutions of innovations –as is the nature of R&D- but we have many sci-entists and engineers working on find-ing a way to capture the heat energy that is lost and transfer it back to active energy. If someone can come-up with that solution, the world will be totally different.”
LETEN’S OPINIONS ON THE TURKISH MARKET“If we go back in time, I’ve started to work for Atlas Copco in 1985, the indus-try in Turkey was not as active as it is these days and during the last decade, it is becoming more and more active, especially in mining and construction.” Recalling an article on construction, Ronnie Leten cites that Turkey comes second after China. “Especially when it comes to Middle East, Turkey is a big market and is a door to other countries. Turkey also has a good education sys-tem and graduates good mechanical engineers. The share of Turkey in our
Atlas Copco’s CEO Ronnie Leten Visited Turkey
Interviewwww.miningturkeymag.com
With the Pleiades programme, Atlas Copco aims at contributing to the careers of women employees and increase the number of higher ranking women within the group. During his visit of Atlas Copco Turkey’s office in Tuzla, Ronnie Leten joined the women employees’ Pleiades meeting and presented his guidance on their career planning, targets and strategies to achieve these
October 2014 19
sales is a little bit lower now because of the political and regional situation; these conflicts do not create a good in-vestment area. On the other hand, Turk-ish lira is devaluated and I came here to be sure if we are taking the right deci-sions on investment and local compe-tence. We always need to be as local as possible because people tend to work with their local people.”
“In my point of view, all four (business) areas of Atlas Copco are very important in Turkey. But if we mention the poten-tial in money terms, the ones that step forward are mining and compressors. For the construction, we are more likely a niche player because we don’t have excavators, bulldozers etc. These two ar-eas are also growing in Turkey so these are the ones that have more potential. Geothermal is another sector that is de-veloping in Turkey and we are focusing on this area to develop our competence. Turkey is a big and populated country, which is growing fast and Atlas Copco has a role in this growth by providing the instruments you need.”
Ronnie LetenCEO
BORN: 1956EDUCATION: M.Sc. Applied Economics, the University of Hasselt Belgium / 1979NATIONALITY: BelgianLANGUAGES: Fluent in English, speaks French and German. Dutch is the mother tongue.
Ronnie Leten also serves as Chairman of Electrolux AB, the Swedish appliance manufacturer, since 2014.
CAREER•General Biscuits, Belgium / 1979-1985•Atlas Copco Airpower nv., Belgium / 1985-1995•Various functional roles in IT, logistics and manufacturing management.•Plant Manager For Tenneco Automotive Inc., Belgium / 1995-1997•Tenneco Inc. is a leading global supplier of ride control, emissions control and
elastomeric products.•Atlas Copco Compressor Technique / 1997-1999•Business development manager at Atlas Copco Airpower nv.•President Airtec Division / 1999-2001•President Industrial Air Division / 2001-2006•President for the Compressor Technique Business Area / 2006-2009•President and CEO of Atlas Copco AB. / 2009 - Current
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Leten describes Turkey as a very civi-lized and open market and indicates that they have special products for Tur-key. “What we launch in US and Europe, we launch it in Turkey, too. But like SmartRoc, there are products that fit better to local needs; it provides auto-mation from long distance, consumes less energy, etc. We sell productivity to our customers, products doing the same and sometimes better, which work with less energy and time.” An-swering the potential claims of prices being high, Leten underlines the so-phisticated structure of the products that also provide sustainable produc-tivity, consuming less energy and less the time to achieve the job. “So, here in Turkey, we sell our high-end products as in the rest of the world.”
CSR IS EMBEDDED IN THE BUSINESSLeten explains corporate social respon-sibility (CSR) at Atlas Copco: “In our company, there are corporate people, who really focus all the time and only on CSR because it always brings the level higher. For me, CSR starts from the first rank people, ‘Do the workers have a safe and healthy work environ-ment?’ and ‘Do they have the updates on their employability?’ because I think it is important that a worker knows that he or she will be in the team as long as possible but if the company does not need their skills, he or she has to know that they will be employed in another position or another company. And of course, if the people are well with cus-
tomers and they do well for the envi-ronment, I think, in this case, the funda-mentals are achieved”
The CEO extends their CSR view to the quality of their products by making sure that their products are consistent-ly “state of the art, safest, less energy consuming”. He also adds, “Another im-portant thing is the business conduct. We do not withdraw from some cor-rupt environment but we do not take the easiest way; we take our positions and we do not give up the develop-ment of the country. We really make
sure that we train our people, we talk to customers. We have zero tolerance for dirty combat; we have a mission for the global society, businesswise.”
“This is the way we work and these (CSR values) are embedded in our business. Otherwise, if people just talk about what the others need to do, it is worthless. We have to take responsibil-ity and change it; start from ourselves.” Moreover, Leten stated that they have merged the previously separate annual financial and non-financial reports be-cause he thinks they are intertwined.
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“Everybody has their roles for a better society and this is the way we try to do it” as CEO summarizes the CSR view of Atlas Copco.
“Environmentwise, our way of work-ing is completely the same. In China, the heat that comes from the factory is used for testing the compressors, reused for the offices in winter and used to cool the offices in summer” says Leten and proceeds by detail-ing the mechanism, “We build a pool, water basin under the factory to capture and store the heat and it is also used for safety, supporting the sprinkler system. All the electricity we need is to turn the pumps.” The CEO states that these strategies are not confined to a single locale; each facility and product is considered separately. “In a factory in United Kingdom, on the border of Wales, we are extending the factory there. The place is windy and we are working on to get the energy from windmills or solar power. We always force our companies to use most economi-cal trucks, we try to avoid flying and take boats because (travelling by) boat is much more environment-friendly. We always measure our carbon dioxide emissions and water usage. All the new products that we launch to the market has to be bet-ter in the measure of emissions and energy saving. Otherwise we don’t accept the design.”
ACQUIRING OTHER COMPANIES“There are two main reasons to acquire a company: to grow our presence and (enhance) market access. It takes a lot of energy and investment to develop a market and maintain presence; know and reach the right customers.” Ronnie Leten presents an example by explain-ing the reasons of their recent acquisi-tion of the distributor in New Zealand; “We were present in New Zealand for many years and now we will have the access by the company. We bought a distributor to get deeper and deeper in the market, to have a close communica-tion with the buyers. And another thing is, products are changing constantly and rapidly. It is difficult for distribu-tors to catch up with the latest devel-opment and to invest in training their people. In contrast, we always want to extend our customers and have a real close contact with them.”
Atlas Copco CEO indicates that another reason for business acquisition is to ex-pand their portfolio. “For example we bought the market leader of semicon-ductors, the Vacuum, because they had a good market, and also, we hired four or five hundred top vacuum engineers, who can extend our product offer that we can sell in our network.” As Atlas Copco operates in four corners of the world, their research showed that many customers who need compressed air, also need vacuum. Therefore, Atlas Copco acquires for market presence and technology. Leten lays emphasis on that their acquisitions are always positive: “We always buy to grow, we never buy to kill.”
HOW IS IT TO BE THE CEO OF ATLAS COPCO?“I’m in this position for five and a half years. You should have an interest in the world to be the CEO for Atlas Copco, a company present everywhere in the world. I have to update myself on geo-political situations globally. You have to have the ability to interact with a very diverse society. That’s why I always say that we do not have a nationality, there is only one and that’s Atlas Copco. You should accept and respect different na-tionalities to work with. That’s the first thing” answers Ronnie Leten.
“The second thing is Atlas Copco has a very diverse product range used in factories, electronics, food, textile, hos-pitals etc. So you must have a reason-able good feeling for technicalities. You have to understand these businesses and take the steps accordingly.”
“The third is to be ready for transforma-tion and find new opportunities. We are in compressor business for a hundred years but if you compare today’s com-pressors with those ones, you will see a very big difference and innovation. So you should have the energy to change, and research, and at the same time you should keep the team motivated. I think these are the most important qualities to lead this big group.”
As to the work engagement, “I travel a lot. Last year I’ve spend just 40 days in my office. So you have to be physically strong at the same time. People want to communicate with you face to face and in a company that has 44,000 people, it is like a big family” says Ronnie Leten and states that a CEO must care for the wellbeing of the employees and try to solve their issues. He concludes with these words: “If people are not happy, there is less productivity and less busi-ness development. We have to keep ev-eryone happy.”
October 201422
GENERAL BACKGROUND ON CYANIDE AND ITS USE IN PRECIOUS METALS MININGCyanide is a general term for a group of chemicals containing carbon and nitrogen. There are about 2,000 natural sources of cyanide, however, the principal man-made forms of cyanide are hydrogen cyanide gas and solid sodium and potassium cyanide. Over one million tonnes of cyanide, representing about 80% of annual production, are used annually in the production of organic chemicals such as nitrile, nylon, and acrylic plastics. Other industrial applications include electroplating, metal processing, steel hardening, photographic applications, and synthetic rubber production. Cyanide is also used in minute quantities in pharmaceutical applications. The remaining 20% of cyanide production is used to manufacture sodium cyanide, a solid form of cyanide that is relatively easy to handle. About 90% of the sodium cyanide produced internationally (i.e., about 18% of total global cyanide production) is used in mining around the world, mostly for the recovery of gold and silver. Cyanide is particularly well suited for extraction of gold (and silver) from low-grade ores and ores that cannot be readily processed through simple physical methods such as gravity separation. The first commercial-scale cyanidation plant used in gold mining began operation at the Crown Mine in New Zealand in 1889, and proved to be so successful that by 1904 cyanidation processes were also established at mine sites in South Africa, Australia, United States, Mexico, and France.
Gold mining operations use very dilute solutions of sodium cyanide in active separation process (100 - 500 ppm).
When dissolved in water, under mildly oxidizing conditions, sodium cyanide solution readily dissolves the gold contained in the ore. The resultant gold-bearing solution is described as “pregnant.” Zinc metal or activated carbon may be added to recover the gold from solution. The residual (“barren”) cyanide solution is typically replenished with fresh cyanide and re-circulated to extract additional gold, or when the ore resource is depleted, may be routed to a waste pond. After gold has been extracted, three principal types of cyanide compounds may be present in wastewater or process solutions: free cyanide, weakly complexed cyanide, or strongly complexed cyanide. Together, the three cyanide compounds constitute “total cyanide.” “Free cyanide” is a term used to describe both the cyanide ion (CN-) that is dissolved in process water, and any hydrogen cyanide (HCN) that is formed in solution. Under normal conditions of temperature and pressure, the concentrations of HCN and CN- are equal at a pH value of approximately 9.4.
While cyanide-bearing solutions are used in mining because they react with gold, they also react with other metals such as Fe, Cd, Cu, Zn, Ni, and Ag to form weak cyanide complexes. These complexes, often referred to as “weak acid dissociable” (WAD), can dissociate in solution to produce environmentally significant concentrations of free cyanide. The rate at which these complexes dissociate depends on several factors, including the initial concentration of the cyanide complex, temperature, the pH of the solution, and the intensity of sunlight, as ultraviolet (UV) light tends to accelerate breakdown effects.
THE INTERNATIONAL CYANIDE MANAGEMENT CODE (ICMC) FOR THE MANUFACTURE, TRANSPORT AND USE OF CYANIDE IN THE PRODUCTION OF GOLDAlthough cyanide is a common industrial chemical, concerns over potential danger to people and the environment have the highest profile in relation to the gold mining industry.xi Following a spill of cyanide from the overtopping of a tailings reprocessing operation in 2000 in Baia Mare, Romania, the United Nations Environment Programme (UNEP) and the International Council on Metals and the Environment (ICME) sponsored a workshop “to review recent accidents involving cyanide, and ways to improve the management of cyanide at gold mining operations.”xii The workshop led to a decision to undertake a multi-stakeholder process under the aegis of UNEP and a multi-stakeholder Steering Committee to develop a voluntary code of technical practice focused on the
Global Best Practices in Cyanide Management: The International Cyanide Management Code (ICMC) and Turkish Experience
Articlewww.miningturkeymag.com
CONTACTS Professor Ata Akcil, Ph. D.-Eng.
ICMC Technical Expert Auditor, Gold Mine Verification Audits
S.D. University, Isparta, Turkey
E-Mail: [email protected]
Glenn Mills, EP (CEA)
Principal Consultant
ICMC Lead Auditor/Technical Expert Auditor, Gold Mine Verification Audits
ENVIRON International Corp., Seattle, WA, USA
E-Mail: [email protected]
October 2014 23
gold mining industry. An independent International Cyanide Management Institute (ICMI) was created to develop and manage the International Cyanide Management Code (ICMC). The ICMC was established as an entirely voluntary standard, and is intended to complement existing obligations to comply with the applicable laws and regulations of the political jurisdictions in which the operation is located. The specific objective of the ICMC is toprotect workers, communities and the environment from the adverse effects of cyanide use in mining; and to improve the management of cyanide by cyanide producers, transporters, and mining companies. Cyanide producers, transporters, and mining operations that adopt the ICMC must have their cyanide-related operations audited by a qualified and independent third party to determine ICMC compliance. Summary versions of audit reports as well as the credentials of the third party auditor are made public by the ICMI in order to openly inform stakeholders of the status of cyanide management practices at specific certified operations. xiii, xiv As of the publication date of this article, the ICMC has been adopted by many international mining companies, cyanide chemical producers, and transportation companies. The challenge that the ICMI now faces is to gain the participation and support of the remaining large, medium and small producers, especially in developing nations.
BECOMING AN ICMC SIGNATORYGold mining companies with either single or multiple operations, and the producers and transporters of
cyanide used in gold mining may choose to become ICMC signatories. By becoming a signatory, a company commits to follow the ICMC Principles and applicable Standards of Practice, and to undertake independent audits of such commitments at least every three years, so long as operations continue. When becoming a signatory, a gold mining company must specify which of its operations it intends to seek certification for, as only those facilities that use cyanide mining are subject to certification. A company that does not have these operations audited within 3 years of signing the ICMC will lose its signatory status.
ICMC IMPLEMENTATIONAs it applies to gold mining operations, the ICMC is comprised of two major elements: Principles and Standards of Practice. There are nine Principles, focused on cyanide production, trans-portation, handling and storage, opera-tions, decommissioning, worker safety, emergency response, training, and public dialog. The Principles broadly state the commitments that signatories make to manage cyanide in a respon-sible manner. Standards of Practice fol-low each Principle, and, as summarized below, identify the specific perfor-mance goals and objectives that must be met in order to achieve compliance with the governing Principle.
1.PRODUCTION: Encourage responsi-ble cyanide manufacturing by purchas-ing from manufacturers who operate in a safe and environmentally protective manner.
Standard of Practice1.1 Purchase cyanide from manu-facturers employing appropriate
practices and procedures to limit ex-posure of their workforce to cyanide and to prevent releases of cyanide to the environment.
2. TRANSPORTATION: Protect com-munities and the environment during cyanide transport.
Standards of Practice2.1 Establish clear lines of responsibil-ity for safety, security, release preven-tion, training and emergency response in written agreements with producers, distributors and transporters.2.2 Require that cyanide transporters implement appropriate emergency response plans and capabilities, and employ adequate measures for cyanide management.
3. HANDLING AND STORAGE: Protect workers and the environment during cyanide handling and storage.
Standards of Practice3.1 Design and construct unloading, storage and mixing facilities consis-tent with sound, accepted engineer-ing practices and quality control and quality assurance procedures and spill prevention and containment measures.3.2 Operate unloading, storage and mixing facilities using inspections, preventive maintenance and contin-gency plans to prevent or contain releases and control and respond to worker exposures.
4. OPERATIONS: Manage cya-nide process solutions and waste streams to protect human health and the environment.
Standards of Practice4.1 Implement management and
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operating systems designed to protect human health and the environment in-cluding contingency planning and in-spection and preventive maintenance procedures.4.2 Introduce management and oper-ating systems to minimize cyanide use, thereby limiting concentrations of cya-nide in mill tailings.4.3 Implement a comprehensive wa-ter management program to protect against unintentional releases.4.4 Implement measures to protect birds, other wildlife and livestock from adverse effects of cyanide process solu-tions.4.5 Implement measures to protect fish and wildlife from direct and indirect discharges of cyanide process solutions to surface water.4.6 Implement measures designed to manage seepage from cyanide facilities to protect the beneficial uses of ground water.4.7 Provide spill prevention or contain-ment measures for process tanks and pipelines.4.8 Implement quality control/quality assurance procedures to confirm that cyanide facilities are constructed ac-cording to accepted engineering stan-dards and specifications.4.9 Implement monitoring programs to evaluate the effects of cyanide use on wildlife, surface and ground water quality.
5. DECOMMISSIONING: Protect com-munities and the environment from cyanide through development and implementation of decommissioning plans for cyanide facilities.
Standards of Practice5.1 Plan and implement procedures for effective decommissioning of cyanide facilities to protect human health, wild-life and livestock.5.2 Establish a financial assurance mech-anism capable of fully funding cyanide-related decommissioning activities.
6. WORKER SAFETY: Protect workers’ health and safety from exposure to cya-nide.
Standards of Practice6.1 Identify potential cyanide exposure scenarios and take measures as neces-sary to eliminate, reduce and control them.6.2 Operate and monitor cyanide facili-
ties to protect worker health and safety and periodically evaluate the effective-ness of health and safety measures.6.3 Develop and implement emergen-cy response plans and procedures to respond to worker exposure to cyanide.
7. EMERGENCY RESPONSE: Protect communities and the environment through the development of emergen-cy response strategies and capabilities.
Standards of Practice7.1 Prepare detailed emergency response plans for potential cyanide releases.7.2 Involve site personnel and external stakeholders in the planning process.7.3 Designate appropriate personnel and commit necessary equipment and resources for emergency response.7.4 Develop procedures for internal and external emergency notification and reporting.7.5 Incorporate monitoring elements and remediation measures into re-sponce plans that account for the ad-ditional hazards of using cyanide treat-ment chemicals.7.6 Periodically evaluate response pro-cedures and capabilities, and revise them as needed.
8. TRAINING: Train workers and emer-gency response personnel to manage cyanide in a safe and environmentally protective manner.
Standards of Practice8.1 Train workers to understand the hazards associated with cyanide use.8.2 Train appropriate personnel to operate the facility according to sys-tems and procedures that protect human health, the community and the environment.8.3 Train appropriate workers and per-sonnel to respond properly to patential worker exposures or environmental re-leases of cyanide.
9. DIALOGUE Engage in public consul-tation and disclosure.
Standards of Practice9.1 Provide stakeholders the opportu-nity to communicate issues of concern.9.2 Initiate dialogue describing cyanide management procedures and respon-sively address identified concerns.9.3 Make appropriate operational and environmental information regarding cyanide available to stakeholders.
ICMC VERIFICATION AUDITS AND CERTIFICATIONVerification Protocols based on the Prin-ciples and Standards of Practice have been separately developed for mining operations, transporters, and producers, and form the basis for an independent third-party audit process. The Verification Protocols are very detailed and transpar-ent, and are openly posted on the ICMI website; see http://www.cyanidecode.org/sites/default/files/pdf/ RevisedAudi-torGuidance.pdf for an example.
Audits are conducted every three years by independent, third-party profes-sionals who meet rigorous qualifica-tions and experience requirements defined by the ICMI. Auditor criteria include requisite levels of experience, specifically in conducting environmen-tal, health, or safety audits; certification as a professional health, safety or envi-ronmental auditor by a self-regulating organization; and confirmation that no material conflicts of interest exist with respect to the audited operation(s).
For gold mining operations, an on-site audit is required within one the opera-tion’s first receipt of cyanide at the site. The audit is considered to be complete (and the three-year period before the next required audit must be conducted begins) on the day ICMI takes formal certification action based on the audi-tor’s findings. Operations are obliged to provide access to all cyanide facilities and make all relevant records and data available to the auditors in order to be considered for certification.
During an initial verification audit, an operation’s compliance at the time of the audit will be evaluated. Subsequent re-verification audits will also evaluate compliance during the period between the preceding and current audits.
Upon completion of the audit, the au-ditor must review the findings with the operation to ensure that the audit is factually accurate. The auditor must prepare a Detailed Audit Findings Re-port addressing all applicable criteria in the Verification Protocol as well as a Summary Audit Report that includes the conclusion regarding the opera-tion’s compliance with the ICMC. These reports are submitted to the signatory and the signatory’s mining operation for resolution of outstanding issues
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prior to submittal to ICMI. The opera-tion maybe considered to be certified with respect to ICMC compliance if the auditor concludes that it is in full com-pliance with the relevant Principles and Standards of Practice. The Detailed Audit Findings Report is the confiden-tial property of the operation and is not released or published by the ICMI; however, the Summary Audit Report for certified operations will be made openly available to the public on the ICMI website.
Operations that are in substantial com-pliance with the ICMC may be condi-tionally certified, subject to the suc-cessful implementation of a Corrective Action Plan. Substantial compliance means that the operation has made a good-faith effort to comply with the ICMC and that the deficiencies identi-fied by the auditor can be readily cor-rected, and do not present an immedi-ate or substantial risk to employee or community health or the environment. Operations that are found to be in sub-stantial compliance must develop and implement a Corrective Action Plan to resolve the deficiencies identified by the verification audit. The operation may request that the auditor review the Corrective Action Plan or assist in its de-velopment so that there is agreement that its implementation will bring the operation into full compliance. The Cor-rective Action Plan must include a time period mutually agreed to with the au-ditor, but in no case longer than one year, to bring the operation into full compliance with the ICMC. The Auditor must submit the Corrective Action Plan to ICMI along with the Audit Findings Report and Summary Audit Report.
The operation must provide evidence to the auditor demonstrating that it has implemented the Corrective Action Plan as specified and in the agreed-upon time frame. In some cases, it may be necessary for the au-ditor to re-evaluate the operation to confirm that the Corrective Action Plan has been implemented. Upon receipt of the documentation that the Corrective Action Plan has been fully implemented, the auditor must pro-vide a copy of the documentation to the Institute along with a statement verifying that the operation is in full compliance. Operations cannot be certified if the auditor concludes that
it is neither in full compliance nor in substantial compliance with any one of the applicable Standards of Prac-tice. An operation that is not certified based on its initial verification audit can be verified and certified, however, once it has brought its management programs and procedures into compli-ance with the ICMC.
All ICMC-certified operations are noted on the ICMI website, which provides publically accessible links to the rel-evant Summary Audit Report as well as a notarized summary of the auditors’ credentials at the time of the audit. Cur-rent statistics on ICMC certifications are provided in Table 1.
THE VALUE FOR THE ICMC TO SIGNATORY ORGANIZATIONSThe programs and procedures identi-fied by the ICMC Principles and Stan-dards of Practice and associated Veri-fication Protocols can be developed separately from other management programs, or can be integrated into a site’s overall health, safety, and en-vironmental management programs. Regardless of the management ap-proach selected, achieving or maintain-ing compliance with the ICMC provides signatories a substantially greater mea-sure of control over the use of cyanide, which otherwise might well be a sig-nificant environmental, occupational health and safety, or social (community relations) risk. ICMC compliance also enhances the risk management profile of a project from the perspective of major financial lenders. For example, the International Finance Corporation (IFC) Performance Standards (IFC, 2012) and the IFC Environmental, Health and Safety (EHS) EHS Guideline for Mining (IFC, 2007) recognize the ICMC as the preferred good international industrial practice (GIIP) for all mines using cya-nide-based mineral extraction process-es. The IFC Performance Standards and
the sector-specific EHS guidelines refer-enced therein also form the conceptual basis for the Equator Principles, which have been adopted by 80 of the world’s major private financial institutions; see http://www.equator-principles.com/index.php/members-reporting/mem-bers-and-reporting.
TURKISH GOLD MINING AND ICMC EXPERIENCETurkey is one of the fastest growing economies in the world, and the fast-est growing economy in Europe, with an average annual real GDP growth rate of 5% over the past decade. Tur-key has a population of 77 million with half under the age 30; it is the 16th largest economy in the world with a gross domestic project (GDP) greater than USD 1 trillion. Turkey also has sig-nificant mineral wealth; it ranks 28th in the world for mineral production and is the 10th most diverse producer of minerals. Turkey has also emerged as Europe’s largest gold producer.
In 2013, gold production was about 35 tons, but the Turkish Gold Miners’ Asso-ciation expects production to increase to 50 tons per year by 2015. This would put Turkey among the 15 top gold pro-ducing nations in the world. Turkey may contain many other economic gold deposits, and it is expected that gold production will continue to be a very positive contributor to the Turkish mining industry in the years to come.
The Kışladağ Gold Mine (see Figures 1 and 2) is owned by Eldorado Gold Corp. of Canada, who are an ICMC signatory. Kışladağ is 35 km south-west of Usak and is the largest Turk-ish gold mine now in production. Mine construction began in 2004 and was completed in 2006; commercial gold production commenced in July of that year. Kışladağ is a modern conventional open pit mine and
ItemMining Companies
& Countries
Cyanide Producers &
Countries
CyanideTransporters& Countries
Totals
Signatory Companies 39 19 112 170
Individual Operations or Facilities of Signatory Companies
133/41 29/15 156/40 318/51
Certified Sites 89/25 25/13 98/34 212/39
Recertified Sites 63/19 16/10 35/17 114/25
Sites Recertified Twice 16/4 10/6 3/2 29/6
Table 1. Number of ICMC signatory companies, including producers, transporters, and mining operations (Source: ICMI, July 2014)
October 201426
heap leach operation comprised of a three-stage crushing plant, an overland conveyor that transports crushed or to the heap leach pad sys-tem, mobile conveyors and a stacker for placing crushed ore on the heap, a composite liner system underlying the leach pads, lined emergency so-lution handling ponds, leach solution pumping and distribution piping; a carbon based gold adsorption, de-sorption, and recovery (ADR) plant, and supporting infrastructure. The fi-nal commercial product of the mine is gold doré bullion. The mine’s current throughput production is 12.5 million tonnes/yr. Gold production in 2013 was 8680 kg (306,182 oz).
A Cyanide Management Plan based on ICMC requirements has been prepared and implemented at Kışladağ. Secure dedicated depots are provided for the storage of cyanide that are fitted with HCN detectors and alarms. Leak detec-tion systems are incorporated into the composite liner system for the heap leach pads, along with barriers to pre-vent access by wildlife or domestic ani-mals. The mineral separation process is designed as a closed system, with no discharge to the environment in normal operating conditions. Water manage-ment features have been designed to accommodate a theoretical 100 year, 24 hour storm event, and diversion ditches have been constructed along the pe-riphery of the heap leach pad to divert surface water away from the facility. Operational water balance models are
used to evaluate heap leach pad per-formance, to determine makeup water requirements, and to estimate both the frequency and size of future storm events; this permits the mine to adjust its solution volumes and water use to prevent any potential discharge to the environment. An emergency hydrogen peroxide detoxification plant has also been constructed that is capable of reducing the cyanide content of pro-cess solution to safe levels, in the event discharge should become necessary as the result of an unusually extreme storm event. The process ponds have a double high-density polyethylene (HDPE) liner and are fitted with leak de-tection systems and solution recovery
pumps. Process pond surfaces are cov-ered with floating plastic balls in order to reduce evaporation and to discour-age birds from landing on pond sur-faces. The heap leach pad and ponds will be progressively decommissioned and closed as each respective leach-ing phase is completed. Kışladağ also maintains very close, collaborative, and responsive relations with regulatory authorities and local communities in order to resolve any concerns over cya-nide delivery, storage, and use.
The Kışladağ Gold Mine was certi-fied in December, 2013 on the basis of a determination of full compliance with the detailed requirements of the ICMC. Kışladağ is the first Turkish mine achieve such status, and was the first mine tobe certified in Eldorado Gold’s international operations. The Summary Audit Report is published on the ICMI website (see http://www.cyanidecode.org/signatory-company/eldorado) as well as the credentials of the certifica-tion audit team. As noted previously the operation must be re-audited every three years hereafter through the end of mine life, in order to verify continu-ing compliance with the ICMC.
LAST WORDIn summary, the ICMC is one of the most rigorous voluntary auditing benchmarks ever to be applied in any international industry. ICMC auditing protocols are exacting, detailed, and transparent, and third party auditors are held to a very high standard with
Figure 1. Kışladağ Gold Mine, view to the west-northwest; active leach pad is shown, along with emergency and process solution ponds and ADR plant in foreground (Source: Kışladağ Gold Mine, 2014)
Figure 2. Kışladağ Gold Mine, aerial view to the southeast; active leach pad is shown in foreground, with open pit shown left of center (Source: Kışladağ Gold Mine, 2014)
October 2014 27
respect to their independence, audit-ing capabilities, and technical experi-ence. Moreover, the IFC, the Equator Principles Financial Institutions, and other multilateral and private lenders often invoke the ICMC as part of the environmental, health, safety, and so-cial conditions of the loans they make to mining projects that use cyanide-based mineral extraction processes. In achieving ICMC certification, the Kışladağ Gold Mine and its parent company have demonstrated to regu-latory authorities, non-governmental organizations, lending institutions, and other stakeholders that it is fully capable of managing its use of cya-nide to the highest and most widely recognized international standards. The successful certification of Kışladağ is also a demonstration to the Turkish mining industry that the adoption of EHS and community relations practic-es that are consistent with the themes of the ICMC will enhance the percep-tion of mining as not only a viable and vital part of the Turkish economy, but also as an environmentally and socially responsible – and internationally com-petitive – industry.
ACKNOWLEDGEMENTSThis review article was partially pro-duced from the authors’ audit experi-ences and the authors wish to thank the Tüprag Metal Madencilik Sanayi ve Ticaret AS Eldorado Gold Corporation/Kışladağ Gold Mine, Turkey for permis-sion to publish the article.
REFERENCES •Agency for Toxic Substances and Dis-
ease Registry (ATSDR). 2006. Toxico-logical profile for Cyanide. Atlanta, GA: U.S. Department of Health and Human Services, Public Health Service. p.298.
•Akcil, A., 2001, Cyanide versus environ-ment: Turkey’s final decision. Mining En-vironmental Management, 9, pp.22-23.
•Akcil, A., 2002, First application of cya-nidation process in Turkish gold min-ing and its environmental impacts, Minerals Engineering, 15, pp.695–699.
•Akcil, A., 2010, A new global approach of cyanide management: International cyanide management code for the manufacture, transport and use of cya-nide in the production of gold. Mineral Processing and Extractive Metallurgy Review Mineral Processing and Extrac-tive Metallurgy Review, 31, 3, pp.35-49.
•Akdur, Ü., A history of gold mining in
Turkey over the last three decades. Turkey & Central Asia Investment Summit (Mines & Money), İstanbul, January 27-30, 2014.
• Botz, M., Mudder, T., Akcil, A., 2005, Cya-nide treatment: physical, chemical and biological processes. Advances in Gold Ore Processing, Chapter 15, ed. M. Adams. Elsevier Ltd., Amsterdam, pp.672-700.
•Euromines, Sustainable gold mining in Europe-Brochure (www.euromines.org), European Association of Mining Industries, Metal Ores & Industrial Minerals, Brussels, Belgium, 2013.
•Greenwald, N., Vice President, ICMI, Personal Communication, July 2014.
•Kuyucak, N. and Akcil, A., 2013, Cya-nide and removal options from efflu-ents in gold mining and metallurgical processes. Minerals Engineering, 50-51, pp.13-29.
•Mudder, T., M. Botz and A. Smith, The Cyanide Compendium, Mining Jour-nal Boks, 1000+ Pages on CD, London, United Kingdom, 2001.
•Mudder, T. and Botz, M., 2004, Cyanide and society: a critical review, The Euro-pean Journal of Mineral Processing and Environmental Protection, 4, pp.62-74.
•www.cyanidecode.org, 2014, The Inter-national Cyanide Management Code.
30 YEARS OF ENGINEERING EXCELLENCE
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STUDIES MINING INFRASTRUCTURE OPERATIONSMINERALSPROCESSING
October 201428
Risk is always in our lives. There is percentage of a safety risk factor in every activity we do. Our daily routines such as driving a car on a highway or climbing a ladder or even drinking water have different level of risk factors. This phenomenon is valid in occupation as well; almost every job has a risk. However, by nature some industries or jobs have higher risk due to their work environment, used material, equipment, employee level of education and even stress level. By all means this should not justify the losses or casualties. One of the key points to have safer environment in such industries is eliminating the human error. This could be achieved by changing the habits: taking the safety as a culture instead of compliance.
Thanks to the media any mine accident is broadcasted in few minutes nowadays. Although there are many incidents and losses in surface mine operations or many other industries; underground mine accidents get more attention. Last year Turkey dramatically lost hundreds of mining personnel; but many others in other industries such as construction, textile
etc… Although there is a different cause for each incident, the root cause is perception of safety. Today vast majority of companies follow safety procedures for compliance purposes. This mentality might reduce the citations; nevertheless it does not help to reduce number of incidents.
Safer work environments start in minds. Any work area will be as safe as their people behaviors and operating procedures. Therefore, culture change is needed for safer operations. Many mines hang the very common motto “Safety First” in work areas. However, not many take it seriously. “Safety First” should become a mentality of an operation. People should always observe the safety conditions when they walk, work, or even rest. In North America safety observations are required from employees in most mining companies as part of their job duties. Sharing a safety condition or warning for upcoming condition keeps employees cautious. In some companies each meeting starts with sharing safety observation by each employee. This behavior became a culture of some mining companies
where they continue even in urban corporate headquarters. Many other operations have regular safety meetings. Information share helps to keep other employees aware of various unsafe conditions or concerns. Inspections are yet another key safety procedure in mining operations. Area inspections, environmental inspections and equipment inspections are mandatory procedures in many mining sites. Usually such inspections are done by answering checklists questions on regular basis or before use. For instance, regular inspection of oxygen masks might save somebody’s life by eliminating the potential expired item. Incidents and property damages are recorded for compliance purposes in mining. However, in Canada un-happened but missed incidents are also recorded as “near miss”. Knowing what almost could have happened can also save somebody from that incident to happen in the future.
Another key part of safe operation is providing regular training for employees. It is commonly believed that providing refreshers and training regularly increase employee performance. In addition, it also helps to improve safety. Tracking task training is one of the basic safety procedures for compliance. Keeping track of employee trainings and providing refreshers on regular periods are a must for an employer. Employees should be regularly refreshed with emergency plans and procedures.
Safety First: Compliance or Culture
Articlewww.miningturkeymag.com
CONTACTS Mustafa Kahraman
The University of Arizona, Department of Mining Department of Mining and Geological Engineering
E-Mail: [email protected] Rescue Efforts - Photograph: Mustafa Karaman
October 2014 29
There are also many new technologies that enables safer environment. Proximity warning systems, operator fatigue monitoring systems, slope monitoring systems and equipment health monitoring systems are all in line with safe mining operations. Also many companies have invested in simulators for operator training; which does not only improve productivity but also safety. All these systems might seem secondary for some; however, they quickly pay off their investment costs by protecting employees and assets.
Having continuous improvement (CI) initiatives for improving safety will also help reducing the incidents. Analysis of the riskiest places, equipment, people and working to solve the issues will be a milestone in safety culture. Hence the data should not stay on the paper; it should be digitized and analyzed. Dashboards and reports that show safety performance of the mine, departments and crews will help to increase visibility and motivation. Unlike many known sites; safety related issues should always be transparent and should be shared with all employees. The slope slide happened in Utah last year was managed very professionally and
transparently. Knowing the safety conditions in the pit (by use of slope monitoring systems) and regular observation helped developing plan B: stopping the operation. Having plan B and being well-organized can help negative image of mining.
Management’s attitude also has crucial role on safety perception of other employees. Management should always show their support for safer environment by encouraging their employees and promoting safety culture. Knowing the management will prefer the production over safety will discourage subordinates from safety first mentality. To satisfy their
management they will always tend to compromise safety. This approach might seem more profitable in short term to save the day or a shift; however, in long term it could lead to disaster.
Everybody deserves going back home safely at the end of their shift. Hence they deserve safer work environment. However, to create a safe work place it is fundamental to do more than compliance. Having change management in place, supported by management, and equipped with correct technology and procedures will impetus safer operations. Developing safety centered culture will not only protect employees; but also assets and production. Safety procedures and applications slightly might vary by country, region or company; however, the desire for safer work environment should be the main focus. It is very expensive to think safety as compliance. Exceeding one shift’s production number can sometimes cost much more than what it brings. There is always a lesson to learn from each incident.
In memory of 301 miners who left eternity in Soma…
A Coal Mine in US - Photo by wordpress.com
October 201430
A draft law amending the Mining Law (the “Draft Law”) is now in the agenda of the Turkish Parliament waiting for the approval of the Prime Ministry. Upon its approval, it will be submitted to the Turkish Parliament for enact-ment. The timing of the enactment is unclear; it is also unclear whether the Draft Law shall be enacted as is. We will thus analyse the draft that has been submitted to the Prime Ministry, which is summarized below.
A. THE FEESThe Draft Law introduces a new fee system where only one payment under the name of “annual license fee” is fore-seen. The current payments of “security deposit” and the “environmental com-pliance security” are abolished. The an-nual license fees shall be calculated in accordance with the mineral group and the size of the area covered by the min-ing license, instead of the previously fixed annual license fees.
Following the enactment of the Draft Law, the security amounts, which have already been deposited, will be accept-ed as license fees and the license hold-ers shall be required to complete the deficient amount, if any.
Since security deposit is abolished, forfeiture of security deposit is now re-placed by an administrative fine mech-anism. Where the forfeiture of the secu-rity deposit is in question, the license holder will be imposed an administra-tive fine in the amount of TL 10,000 –50,000 (apx. USD 4,630 - USD 23,150), which shall be revised by the Ministry of Finance annually.
B. STATE ROYALTYThe most criticized provision of the Draft Law is the unexpectedly high increase in the state royalty amounts, especially for gold, silver and platinum. The new royalty amounts provided un-der the Draft Law, which may not be less than the annual license fee, can be summarized as follows:
Calculation of the pit head sale price is currently unclear in the legislation and is calculated based on the cur-rent practice of the Mining Depart-ment. The Draft Law provides a clear calculation method which will be de-termined in accordance with the min-eral group and the region to be an-nounced by the Mining Department each year.
The additional 30% royalty for the mining activities conducted on state-owned lands and 50% incentive for the ores that are processed in the facilities of the license holder in Turkey are main-tained under the Draft Law.
C. TERM OF THE OPERATION LICENSEThe Draft Law decreases the upper thresholds for operation licenses (i.e. 30 years for Group I, 40 years for Group II, and 50 years for the other groups of mines). The Minister of Energy and Natural Resources is au-thorized to extend the term of min-ing licenses for Group I and Group II; whereas, the Council of Ministers is authorized to provide an extension for other group of mines. The terms provided under the current law will continue to apply to the licenses is-sued under the existing law.
D. TRANSFER OF MINING LICENSESPursuant to the Draft Law, transfer of mining licenses shall be subject to the approval of the Minister of Energy and Natural Resources, which is currently subject to the affirmative opinion of the Mining Department. The fee to be paid during the transfer is also increased by the Draft Law (i.e., two times of the an-nual license fee).
E. MERGER OF MINING LICENSESThe current law does not allow the license holders to merge adjacent li-censes for the purpose of constructing mandatory production and infrastruc-ture facilities on the adjacent license
What Does The New Mining Law Change?
Articlewww.miningturkeymag.com
CONTACTS
Şebnem Önder1, Göknil Emdi2
Akol Avukatlık Bürosu
Address : Maya Akar Center Büyükdere Cad. 100/29 34394 Esentepe, İstanbul
1) Partner, Akol Avukatlık Bürosu
2) Associate, Akol Avukatlık Bürosu
Phone : +90 (212) 355 13 00
Email: [email protected]
Website : akol.av.tr
Group of the MineRoyalty over pit-head sale price
Current Law Draft Law
1. Group I 4% 4%
2.
Group II (a) 4% 4%
Group II (b) 2% 4%
Group II (b) if extracted ores are processed into a final product in the facilities of the license holder in Turkey
1% 1%
3. Group III 4%5% (except for resource salt)
1% (resource salt)
4.
Group IV (excluding gold, silver and platinum) 2% 4%
Group IV (gold, silver and platinum) 4% 14%
Group IV (turf) N/A 2%
Group IV (c) if extracted ores are processed into a final product in the facilities of the license holder in Turkey
1% N/A
5. Group V 4% 4%
6. Group VI 4% 8%
area where there is not enough proper and sufficient space. The Draft Law brings such opportunity by introduc-ing certain exemptions to the rule that “the total mining license area may not exceed the limitations foreseen under the Mining Law in case of a merger of licenses”.
F. COMPLETION OF NECESSARY PERMITS WITHIN THREE YEARSThe disputed cancellation sanction envisaged for operation license hold-ers, who cannot complete, within three years, the environmental per-mits and surface rights is contemplat-ed to be abolished. Instead of can-cellation, the annual license fee shall be doubled, which is a significant
development for investors whose operations are delayed due to gov-ernmental formalities. The Draft Law also aims to reduce bureaucracy by setting forth that public interest deci-sions adopted by the Ministry of En-ergy and Natural Resources shall be deemed to satisfy the surface rights completion requirements.
The Draft Law provides an opportu-nity to the operation license holders, whose licenses have been cancelled or have become subject to cancella-tion as of 25 June 2011 due to failure in obtaining the required permits, to recover their licenses on the condi-tion of obtaining the missing permits and surface rights within one year
starting from the effective date of the Draft Law.
G. CONCLUSIONThe Draft Law has been withdrawn from the Parliament’s agenda upon the tragic Soma accident since prior-ity is given to other amendments to the Mining Law such as prohibition on subcontracting of mining works, providing more strict rules with re-gard to health and safety. Also, the Draft Law has been subject to heavy criticisms due to the increase in the royalty amounts especially by gold mine companies. Therefore, it is un-clear when the Draft Law shall be en-acted and more importantly whether it shall be enacted as is.
www.chesserresources.com.au
Exploring for Gold and Base Metals in Turkey
October 201432
‘Process mineralogy’ is a form of ap-plied mineralogy which focuses on ad-dressing problems associated with the processing of ores and has been de-fined as ‘the practical study of minerals associated with the processing of ores, concentrates and smelter products for the development and optimisation of metallurgical flow sheets’, Henley (1983).
The success of the process from rock breakage, feed preparation and clas-sification to separation into streams of various mineral concentrations for sale or disposal implies knowledge of the minerals themselves. The key attributes to be considered include: the element deportment in the minerals in the ore, the bulk modal mineralogy, the mineral grain size, texture and association. For design purposes, this knowledge defines the entitlement and potential recovery of an ore and impacts the choice of the metallurgical flowsheet. For the opera-tion, it facilitates diagnosis of the sources of weaknesses and opportunities. For the environment, it enables the manage-ment of waste and potentially deleteri-ous material. For research it inspires the development of new technologies.
The critical aspects of successful pro-cess mineralogy can be summed up by the four “I’s”:1. Information: Appropriate measure-
ments and accurate data obtained from representative and appropri-ate samples and analysed by the ap-propriate instruments (which have been calibrated).
2. Interpretation: Correct analysis of the measurements obtained.
3. Implication : Converting the inter-pretation of the measurements to the implications of the process
4. Implementation: Change to either the existing circuit or the process design is needed by different parts of the team which needs effective communication and commitment.
If any of these steps are missing the whole process is threatened and much of the
value can be lost. Thus the potential bar-riers to achieving the value can largely be attributed to short-term thinking, the im-position of inappropriate time or budget constraints, or to a lack of understanding of either the project aim or process min-eralogy as a whole.
As lower grade deposits are mined, one of the limits to potential exploitation is provided by the mineralogical complex-ity. Figure 1 illustrates the mineralogi-cal barrier between current operations on the right and the increased number of potential lower grade mining opera-tions on the left. For any deposit to be economically viable, the project rev-enue from payable metal extracted has to exceed the associated costs of mining and processing. Thus the adoption and implementation of new technologies is the key to accessing the lower grade de-posits in the future.
A mineralogical barrier identified over 100 years ago was dramatically over-come when the flotation process was developed at the Broken Hill Lead-Silver-Zinc mines in Australia in the early 1900s (Clark et al, 2005, Lynch et al, 2007). The mines had started in the mid-1800s di-rectly smelting oxide ores to produce lead silver bullion. As the oxide ores were depleted and sulphide ores became available, gravity separation of the dense
lead-silver component was adopted in the 1890s although in this process con-siderable revenue was lost as the silver and lead were recovered but the zinc was lost to the tailings. Facing financial ruin and after the failure of the use of magnet-ic separation in 1901, the potential of an ‘academic curiosity’ was considered and after significant effort, the world’s first in-dustrial flotation process was developed. Initially a bulk concentrate was obtained and later with the incorporation of chem-istry (copper sulphate addition) by Brad-ford, (1913) selective lead and zinc con-centrates were produced.
Fuerstenau (2007) records the signifi-cance of this event to the industry with his quote from mining geologist, P. Billingsly (1928) ‘The mining geologist searches for materials which the metal-lurgist can utilise, and only such; when-ever an advance in metallurgy opens the gates for new materials, the ge-ologist’s problem is accordingly modi-fied… The metallurgist has been the geologist’s best friend and the geolo-gist has in turn been able to convey the metallurgist’s ideas into the concrete form of an increased ore supply.’
The contribution of a high quality team, including the degree of cross-training, varied experience, communication and trust, can often be unrecognised but it dictates the potential capacity of the team. In their discussion of the develop-ment of flotation, Clark et al (2005) note that ‘Innovation benefits from the inter-section of different minds enriched by a varied experience (eg it is reasonable to surmise that Mr Delprat’s apprenticeship in engineering in construction of the Tay Bridge, his experience in working as an assistant to the famous physicist Prof van der Waal in Amsterdam, and his ex-perience in the mining industry in Spain all fuelled his contribution to innovation in The Broken Hill Proprietary Co Ltd).’
Effective process mineralogy has been used for many years around the world to
The Role of ‘Process Mineralogy’ in Improving the Process Performance of Complex Sulphide Ores
Articlewww.miningturkeymag.com
Figure 1: A conceptual illustration of the mineralogi-cal barrier potential to processing lower grade ore bodies facing the mining industry (from Mudd, 2013).
October 2014 33
lower the risk in design of new circuits, to diagnose and aid correction of poor per-formance of existing flotation and leach-ing circuits, and, in particular to optimise plants processing variable ore types. Its benefits have been greatly enhanced by the skilled use of the new generation of automated quantitative instrumenta-tion. Specific benefits include:
•Characterising the deportment of ele-ments in the minerals present, along with their association and texture so as not to rely on grade alone. This makes it possible to adapt the metallurgi-cal processes accordingly; from the target feed grind size to the chemical environment and reagents needed for the target selectivity. Mineralogy can be used to design a staged-grind and flotation strategy to recover minerals as early as possible thereby reducing the right minerals to the right size in the right place, and recovering them as quickly as possible, in similar-sized fractions as shown in Figure 2, (Lotter, et a1, 2011)
• Identifying and characterising prob-lematic minerals and the deportment of deleterious elements, enables the
manipulation of reagents (eg floatable gangue depressants can be added) or alternative mining and/or processing strategies can be developed. In par-ticular talc minerals can be a problem and if adequate measures such as de-pressant addition are not taken, prob-lems of uncontrollable froths are ob-tained such as shown in Figure 3 from Dunham and Vann, (2007).
•Different processing strategies can be evaluated, resulting in better design and optimisation. Examples exist of ore deposits that were unviable and
became economically viable with the incorporation of appropriate process mineralogical, sampling and metal-lurgical tools, particularly with the incorporation of appropriate chem-istry for process development. These include the ‘Kamoa’ copper project in the Democratic Republic of Congo (Lotter et al, 2013) and the ‘Yenipazar’ lead-zinc deposit in Turkey by Ekme-kci et al (2014).
Process mineralogy, though associated with some capital investment, is a valu-able risk reduction tool for any mining company, not only in terms of finances but also in terms of human and intellec-tual capital. When the economic losses caused by poor ore characterization, insufficient hardness profiling, excessive reagent consumption, underperform-ing flow-sheets and related costly post start-up ‘de-bottlenecking’ (or a combi-nation thereof) are considered, the ex-penditure is a small price to pay (Baum, 2014). It is necessary to have integrated multidisciplinary teams with the ap-propriate equipment, skills and knowl-edge and support. For the larger mining houses, and even some larger opera-tions, the investment has shown to be worthwhile in terms of bringing such skills and equipment in house. For small to medium size companies and opera-tions, access to these may be through
Figure 2 Staged grind approach to demonstrate that different ore types require a level of size reduction for liberation (from Lotter et al , 2011)
Professor Dee Bradshaw recently gave a plenary presenta-tion on this topic at The International Mineralogical Asso-ciation in Johannesburg, South Africa from 1-5 September 2014. The theme of the conference “Delving Deeper: Miner-als as Mines of Information”
Dee Bradshaw has recently spent six months as a visiting Professor at at Hacettepe University. She has been a Professorial Research Fellow at the Julius Krutt-schnitt Mineral Research Centre (JKMRC), part of the Sustainable Minerals Institute at The University of Queensland (UQ) since 2008 after working for the Centre for Minerals Research at the University of Cape Town (UCT) for over 25 years. In this time she has supervised over 40 post graduate students and published and presentated over 150 papers at conferences. She has participated in many post graduate and professional development courses for industry in South Africa, Australia, Canada and Turkey.
In 2013 she was recognised by the University of Queensland as a leader who nurtures and develops her graduate students, a concept she calls ‘Living Gold’ (http://vimeo.com/73666824).
October 201434
consultants and service providers. When it is effective, the technical capacity and benefits far outweigh the costs, howev-er as noted when one step is missing the high goal is not achieved and the value of the investment in process mineralogy may not be realised.
Without an understanding of the impli-cations of the measurements, effective communication within the processing team, (i.e. geologists, mining engineers, mineralogists, process engineers & min-eralogists, chemists, environmentalists etc.), and the effective implementation of changes, the information is useless and the resources are wasted. Geomet-allurgical studies that are focussed on black box statistical correlations without the consideration of the underlying min-eralogical drivers can fall in to this trap, further propagating the misconceptions around the value of such work. Open en-gagement between disciplines and with process mineralogy specialists will help manage these challenges and ensure the success of such projects is realised, Schouwstra and Smit, (2011).
The biggest risk is short-term ‘cost reduc-tion’ thinking rather than the longer term ‘value’ focus. Most importantly if the val-ue is not recognised throughout the or-ganisation and operational priorities are on short-term cost reduction, then ap-propriate resources will not be allocated by the various stakeholders including; mining companies, equipment suppliers, research and development companies as well as education and training providers. Without the appropriate skills and ex-pertise to operate the expensive equip-ment and interpret and analyse the data obtained, the investment is wasted and operational risk remains high.
The relatively ‘easy to process’ ore sourc-es will run out, and long term investment in process mineralogy is vital to mitigate this. New, more complex operations, re-quiring integrated and sophisticated use of current and future knowledge can be developed to overcome technical, en-vironmental or societal considerations; for example when the excessive use of energy and water cannot be tolerated or permitted. Innovative and novel tech-nologies, and the skills to utilise them to process lower grade deposits can be de-veloped, and the mineralogical barrier to many low grade, currently unprocess-able deposits, including current tailings
dams or urban waste, can be removed.Without appropriate and effective process mineralogy tools and teams, the future of the mining industry contributing to the world’s sustainable future is jeopardised. Any part missing from the discipline will prevent its value and its effective contri-bution, and be a wasted cost. This requires engagement, support and cooperation from all stakeholders, from the operating mining companies, equipment suppliers and educators (especially universities). A focus on ‘costs’ and ‘short-term’ delivery by any of the stakeholders will undermine our future, and a ‘longer term’ commit-ment to the integration and value of pro-cess mineralogy is essential to realise the potential enhanced capability available to maximise our mineral resources.
Appreciation and thanks for all the help, support, discussions and insights with many friends and colleagues through the years.
REFERENCES•Baum, W (2014a) ‘Ore characterization,
process mineralogy and lab automa-tion a roadmap for future mining’, Min-erals Engineering, vol. 60, pp. 69-73.
•Billingsly , P (1928) ‘How flotation has broadened the geologist’s viewpoint.’ Flotation Practice. American Institute of Mining and Metallurgical Engi-neers. New York. Pg. 33.
• Bradford, L (1913) Australian Patent 8, 123.
•Clark M E, Brake, I, Huls, B, Smith B E and Yu M (2005) ‘Creating Value Through the Application of Flotation Science and Technology’, In proceed-ings Centenary of Flotation, ISBN 1
920806 31 8, Brisbane, 4-6 June, 2005.•Dunham and Vann, (2007) Geometal-
lurgy, Geostatistics and Project Value - Does Your Block Model Tell You What You Need to Know? Project Evaluation Conference, Melbourne, Vic, 19 - 20 June 2007.
•Ekmekci, Z, (2014) Internal reports, personal communication.
•Henley, K J (1983) ‘Ore dressing miner-alogy – a review of techniques, appli-cations and recent developments’. In: De Villiers, J.P.R., Cawthorn, P.A., (Eds.), ICAM 81, Proceedings of the First Inter-national Congress on Applied Miner-alogy, Special Publication. Geological Society. South Africa, 7, pp. 175–200.
• Lotter, N O, Kormos L J, Oliveira, J, Fragomeni, D and Whiteman, E (2011) ‘Modern Process Mineralogy: Two case studies’, Minerals Engineering, Volume 24, Issue 7, June 2011, pp 638-650.
•Lotter, N O, Oliveira, J F, Hannaford, A L, Amos S R (2013) ‘Flowsheet devel-opment for the Kamoa project – A case study’. Minerals Engineering, Vol-ume 52, October 2013, pp. 8-20.
• Lynch, A J, Watt, J S, Finch, J A and Har-bort G J (2005) ‘History of Flotation Tech-nology’, Froth Flotation A Century of Innovation, eds MC Fuerstenau , G Jame-son and RH Yoon, Society of Mining, Met-allurgy and Exploration Inc. (SME) Little-ton Colorado, USA , pp. 65-94.
• Schouwstra, R P and Smit, A J (2011) ‘De-velopments in mineralogical techniques - What about mineralogists?’ Minerals Engineering, 24, (12), pp. 1224-1228.
•Mudd, G.M., Weng Z. and Jowitts (2013 A detailed Assessment og global Cu resource trends an endowments; Eco-nomic geology 108 pp. 1163-1183.)
Figure 3 The impact of talc on a flotation circuit in Western Australia from .Dunham and Vann, (2007)
October 201436
Tyre management, and the direct fo-cussed management of the operating conditions underfoot, or rather the lack thereof, can cause underground oper-ating costs per tonne mined to spiral out of control and even render opera-tions non-profitable.
The life of Tyres fitted to mechanised min-ing equipment of all types, but especially those vehicles involved in intensive load-ing & hauling operations, like LHD’s (Load Haul Dumpers) and ADT’s (Articulated Dump Trucks), always depends on local conditions and will vary from mine to mine, specifically dependent on the fol-lowing; Road design, Road maintenance, loading practice and spillage control, blast fragmentation, water control, etc.
The variation can be very large and in bad conditions can run up to 60% of the total costs per tonne of the load-ing & hauling operations, so it serves management well to give concentrated training and attention to both opera-tors and supervision, as well as to all aspects of road design, road surface maintenance and blast control of the muck pile for optimum fragmentation.
So let’s examine typical examples of what to do and what not to do.
One of the things regularly attempted by mines management is to not to worry too much about road conditions, especially in main development areas and in production stopes face areas or draw points, instead they go for fitting tyre protection chains. Well generally this is an example of what not to do as you are just adding cost and not ad-dressing the problem.
The decision to go with chains or to have the flexibility to fit chains is one that usu-ally needs to be specified at the time of order of any new LHD, ADT, or the like, for underground use. This is because gen-
erally insufficient clearance exists in the wheel arches to fit the chains on older models. Then comes the time when you need to retro-fit chains due to changing/worsening underfoot conditions in an at-tempt to improve tyre life and reduce op-erating costs on loading operations and you cannot without first machining (peel-ing) the tyres to gain diameter clearance.
Now this is when that past decision to buy a major big brand machine like Sandvik (Toro/Eimco) or CAT or Atlas Copco/Wagner will pay off as typically with these machines you can simply small mods to the front mudguards and get chains on without machining the tyres. But retro-fitting does void certain warranties on the machine also. This is important, not only because you lose significant life when you peel the tyres which, offsets much of what you gain by fitting the chains, but it also changes the torque characteristics of the machine and impacts ‘sump-in’ and ‘break-out’ force from the muck pile reducing the machines performance and cycle as well as component life on Bucket and pins, front cylinders and front axles. On the rear it is less important but it still does bring the machine in to an unbalanced condition and will negatively affect the lifetime operating costs of the machine.
So this brings us back to the decision and reasons for wanting to go with chains in the first place? Well generally this is re-lated to excessive water underfoot and tyres getting cut and punctured. Tyres do not like water in the face area where loading takes place, so either you need to get better water control through lo-calised sumps and pumping solutions when loading or acquire machines de-signed to take chains as standard and fitted by the OEM (Original Equipment Manufacturer) to maintain warranties.
If the use of chains is really your only op-tion, then when you use chains on new
(un-peeled) tyres typically you should be getting 50% to 70% life expectancy improvement if all other operating con-ditions remain unchanged. With peeled tyres, it must be remembered that typically this is only done on the front tyres and that it has a big impact on the dynamic forces on the tyre when you reduce the circumference. Mechanical shock and torque forces are increased at the rim contact (tyre bead) normally. When you add the chains the weight added back is typically 2.5 to 3 times the weight of the rubber removed from the tyre with peeling so this adds to the tyre loading forces at the rim contact.
So as a ‘SAFETY TIP’ you must ensure that you fit good unworn or new locking rings with chains in this case so you don’t run the risk of tyre blow outs from these add-ed forces. Further, instruct/coach your
Tyre Management - A Major Aspect of Underground Mechanised Mining Operations
Articlewww.miningturkeymag.com
CONTACTS
Alan M. Clegg
Chairman, Afrasia Mining & Energy Consulting AS
Head Office: Mustafa Kemal Mah. 2146. Sokak Demirler Atlas Plaza No: 14/16 Ankara- Turkey
Phone : +90 (312) 219 44 15
Website : www.afrasia.com.tr
October 2014 37
operators to avoid wheel spin and try to force it when ‘sumping-in’ to, or breaking-out of the muck pile. Smooth actions with slightly lower fill factor will give more sustainable results and limit dam-age and blow-outs which are common with chains and heavy handed operators.
From experience the life expectancy of a peeled tyre with chains is increased 35% to 55% if operators understand the change in operating parameters and feel for the balance over time in local conditions.
So it’s good to remember that first you lose life by peeling the tyre; from a study in South African Gold Mines in the late 80’s to early 90’s, for every 5% reduction in tyre diameter due to peeling, 8% to 10% of the useful life was lost and it reduced the number of times a tyre shell could be re-treaded from three (3) to one (1)!
Chains are not the ultimate solution and can end up being even more expensive than running without them, if the deci-sion is not well considered. Time spent in improving muck pile quality, remov-ing/reducing water in the face, and get-ting better road design and underfoot conditions is actually more beneficial in the long term unless you have a specific localised problem.
UNDERGROUND ROAD DESIGN CONSIDERATIONSTo outline procedures to be followed when designing mine roads for trackless mechanised mines to optimise tramming costs and ofcourse positively impact tyre life. Main objectives when designing un-derground mine roads should be; a) The cost effectiveness of the roads and b) The safety aspects of the roads.
Road Width In order to avoid conges-tion, the road width should be a func-tion of the size of vehicles to be used on the particular road. As a rule of thumb, double the widest vehicle will deter-
mine road width to be used. However, if there are sharp curves on the road, ad-ditional width is to be included.
Safe Distance between Vehicles. This is taken as a function of driver reaction time (rule of thumb of 2seconds), the road sur-face, the gradient plus an allowance, usu-ally 5.0 metres. The formula is therefore:
d = 2.0v/3.6 + v2 / 254(c+-i) + 5.0 Where; v = vehicle speedd = safe distance between vehiclesc = co-efficient of friction of the surfacei = steepest mine road gradient e.g. 10% = 0.1
Gradients: This should be limited to between (10-20) percent (6 degrees to 12 degrees). For safety and drainage purposes, long steep gradients have to include 50m long sections with a maxi-mum gradient of 1 (one) degree for ev-ery 500 - 600 metre severe curve.
Lines of sight. For both vertical and hori-zontal curves, ample sight distance has to be provided to allow for adequate brak-ing distance at the operational speed.
Runaway Precautions: In some situa-tions, it might be necessary to locate piles of non-consolidated fines in the centre line of the mine road in order to guard against runaway trucks. When the brakes fail the driver will straddle the pile and bring the truck to a halt.
Drainage: The drainage system should be such that water is collected away from the road network proper. V-type drains should be used. The slope sides of the drain being from 2: 1 to 4:1. The gradients of the drains should be re-stricted to 3% and 5%.
Road Signs: All mine roads should have adequate signs to warn, prohibit and gen-erally direct drivers. These to be periodical-ly cleaned to remove dust accumulation
Construction Material: As far as possible excavation should be down to “base rock” After this the sub-grade base is prepared. SUB-GRADE: Preparation of this involves grading of the base rock to a level surface with a grader. After this the sub-base course is laid. SUB-BASE: This is of an aver-age thickness of 150mm to 200 mm. This will be fully compacted with a vibrating roller or the controlled passage of trucks. After this the base course is laid. BASE COURSE: This is usually crushed rock or high quality gravels (-125 to -100mm). This is also fully compacted with a vibrat-ing roller. After completion, the surface or running course is laid. SURFACE OR RUNNING COURSE. This is of at least 100 mm in thickness. Materials of low rolling resistance coefficients and high adhesion that will give a hard even surface, little dust and low penetration under load are normally the most suitable. Examples are concrete, asphalt, paving stones, crushed rock (-10mm to +2mm) and course sand mill tailings.
OPERATIONAL: When grading haul roads to maintain clear even surfaces, this should be done up gradient to maintain surface consolidation.
In summary then Tyre Management re-quires a holistic and systems engineering approach to ensure optimum results are achieved. Machine specification being correct for the duty and conditions to be expected is central to good sustainable results and OEM’s should be consulted. Design, build & maintain the in-mine roads to good standards. Keep water out of the loading areas as far as possible. Focussed attention on blast design and fragmentation achieved in muck piles will deliver optimal loading costs and minimal machine erosion and damage. Finally, good training and supervision of operators using loading and hauling equipment is key to overall optimisation of the operating costs element attached to Tyres in mechanised mines.
October 201438
SUMMARYSome of the metallogenic and mineral-ogical features of magmatic rock suites in central Anatolia and their exploration consequences deserve much attention as Late Cretaceous and Mio-Pliocene magmatism shares many similarities with their counterparts in Bulgaria, Romani and Iran. The recent works on the porphyry Cu-Mo mineralization in the eastern Tethyan belt are favor of a magma developed under extensional setting postdating major continental collision, and this is why central Ana-tolia should be explored for porphyry style deposits. The fact that the central Anatolian magmatism is characterized by a post-collisional fingerprint due to a lithospheric delamination or core-complex development starting from the latest Cretaceous, provides a suit-able source for the generation of Cu-Au fertile melts that were mixed with hy-drous generated at shallow crustal lev-els. This paper evaluates the porphyry Cu potential of Central Anatolia where A-type and H-type intrusive and extru-sive suites co-exist, and generate new targets that might have intrusion-host-ed Au and calc-alkaline and alkaline-related porphyry Cu potentials. A-type syenitic rocks and H-type K-feldspar megacryst-bearing monzonitic suites and their geochemical-geodynamic associations have been questioned whether they have any resemblance to the alteration type, host rock lithology, style of mineralization, tectonic setting of the porphyry Cu and intrusion relat-ed gold type of mineralization.
INTRODUCTIONMany significant ore deposits in Turkey are found in a variety of geologic-tec-tonic environments. Although, some of these deposits have been recognized for many years, recent geological, geo-chemical and ore deposits modeling are now sufficient to provide coherent new deposits types and new prospec-tive deposit types (potential) in Tur-key. Although, the central Anatolia is a
metallogenic province known to host for skarn, IOCG, epithermal, and car-bonate-hosted Pb-Zn deposits formed at the expense of post-collisional I-, and H to A-type magmatic rocks (Fig.1), the fluorite bearing sheeted veins hosted by nepheline porphyry syenites, or W-bearing quartz veins accompanied by molybdenum in highly evolved H-to I-type granitic rocks have not been at-tracted the attention they deserve. Be-sides, the discovery of Oksut high sul-fidation epithermal deposit hosted by volcanic-volcanoclastic sequences of Erciyes stratovolcano, and common as-sociation of this deposit with a calderas developed in response to a transten-sional tectonics provide evidence that the younger-extrusive magmatic activi-ties are also very important in terms of gold mineralization in central Anatolia. The exploration for calc-alkaline and alkaline-related porphyry style miner-alization are subject to new programs in Central Anatolia resulting in lacking of key empirical and descriptive ore deposit models. These were not taken as immediate gold-copper exploration targets as they are presumed not to meet criteria of many explorationists seeking to find bonanza-type or typical porphyry type mineralization. Howev-er, the recent studies have shown that the magmatic suites at post-collisional settings may well be the exploration targets for gold and copper if they are formed as a consequence of mixing of chemically different two magmas. The scientific community published many papers on the geology and geologic-tectonic setting of magmatic rocks in central Anatolia concluding a clear post-COLG magmatism formed during Upper Cretaceous to Paleocene. They also suggested that the central Anato-lian magmatics are the products of mix-ing and mingling of a mantle-originat-ed mafic alkaline magma and crustal derived calc-alkaline magma, and the former is said to be exposed occasion-ally as intruding the latter. The distri-bution, in both space and time, of the
mineral deposits of the Central Anatolia reveals some interesting and enigmatic features of mineralization in a colli-sion related setting. Central Anatolia is a polymetallic metallogenic province hosting mineral deposits of various size and type. This paper concerns with the genetic coexistence of H-type and A-type post-collisional magmatism and associated mineralization. Early-Middle Eocene is defined as an impor-tant period, and defines a belt hosting volcanic, volcanoclastic and intrusive rocks where there is a great potential of discovering porphyry and epithermal Cu-Au mineralization. The world-wide metallogenic and geochemical, tec-tonic characteristics of porphyry and epithermal systems suggest that the extension-related mixed magma series are not fertile for giant Cu-Au porphy-ries, however they favor near-crust or shallow seated medium to small sized porphyry and epithermal systems like the ones (Copler and Kabatas, Horoz and Karamadazi) defined in this paper. Therefore, it is this period that future exploration for medium sized shallow porphyry and epithermal mineraliza-tion should be conducted.
GEOLOGICAL SETTING OF MAGMATIC ROCKS IN CENTRAL ANATOLIAPetrogenesis, evolution and emplace-ment of the magmatic rocks in central Anatolia indicate a continuous mag-matic activity since Late Cretaceous resulting from the collision between Tauride-Anatolide Platform (TAP) and Pontides. Following tis collision, a post-collisional extension due to lithospher-ic delamination or slab break-off during Late Cretaceous-Paleocene resulted in
Potential of Porphyry Cu Mineralization in Central Anatolia
Articlewww.miningturkeymag.com
CONTACTS İlkay Kuşcu
Muğla Sıtkı Koçman University, Department of Geological Engineering, TR-48000 Muğla
Email : [email protected]
October 2014 39
adiabatic decompression and under-plating mafic magma. This event did not only trigger partial melting within the continental crust and formation of the felsic magmas, but also the intru-sion of mafic magmas into the felsic ones (Fig.2). Mixing of felsic and mafic magmas gave way to the formation of complex post-collisional intrusions (82 to 67 Ma) and magma mixing prod-ucts. Post-collisional Central Anatolian plutonic rocks have calc-alkaline and alkaline characteristics, and are gen-erally enriched in LILE and LREE com-pared to HFSE, and have high 87Sr/86Sr but low 143Nd/144Nd ratios. These char-acteristics indicate an enriched mantle source with crustal assimilation and subduction zone components, and
complex magma mixing-mingling events. Plutonic rocks include 1) I-type (HLO) metaluminous, high-K calc-alka-line monzodiorites to granites with K-feldspar megacrysts, and 2) A-type alkaline monzonitic-syenitic rocks with K-feldspar megacrysts, formed during the late stages of post-collisional mag-matism. After Arabia and Anatolides were sutured, large scale postorogenic crustal-scale (strike-slip) faulting was accompanied by bimodal volcanism in the early to middle Eocene. The widespread post-orogenic felsic calc-alkaline to alkaline (and mafic alkaline magmatic activity along the Karama-dazi and Horoz can be explained by detachment of slab (slab break-off pro-cess) beneath the Malatya-Keban plat-
form (Eastern Taurides). A change in the convergence rate or further increase in the roll-back has been coupled with slab-break and crustal scale structures with sub-basins bounded by faults with dominant sinistral strike-slip compo-nent and co-magmatic shallow intru-sions at Early-Middle Eocene.
METALLOGENY OF GRANITOIDS AND ORE DEPOSITS IN CENTRAL ANATOLIAIntrusion of H-type magmas resulted in the formation of skarn deposits en-riched in Fe-oxide minerals, and Fe-ox-ide-Cu-Au (?) (IOCG) deposits. In many cases occasional W enrichment are also known in most of Fe-oxide deposits. This is related to the heterogeneous
Figure 1. Simplified geological map of Central Anatolia (numbers refer to the Ar-Ar ages)
October 201440
distribution of mafic and felsic rocks with-in the pluton. For instance, W mineraliza-tion is related to more felsic rocks, while Fe mineralization is related to the more mafic ones. Fe and Fe-Cu mineralization occur as massive bodies or lenses within the pluton, or close to pluton margins where felsic and mafic rock groups coex-ist within the same pluton. W mineraliza-tion on the other hand, are observed as veins within the plutons and are associ-ated to more felsic rocks. The occurrences are usually controlled by major structural alignments that experienced pervasive metasomatism and alteration. Whole-rock geochemical compositions of plu-tonic rocks associated with Fe-skarn de-posits suggest a possible potential both for porphyry Cu and Au as well (Kuşcu et al., 2001; 2002). Possible Cu potential for these deposits can be based on: 1) pres-ence/occurrence of sulfide mineralization (chalcopyrite, malachite, chalcocite, mar-casite and pyrite) along calcite or quartz veins in retrograde stage (e.g. Çelebi, Kesikköprü (Kırıkkale), Karamadazı (Kay-seri), Divriği (Sivas)), and 2) malachite
mineralization within stockwork zones and argillic structural lineaments in mag-matic rocks within Sarıkaraman (Ortaköy, Aksaray) region.
The formation and emplacement of the Late Cretaceous to Paleocene disten-sional-related and intracrustal A-type post-collisional intrusives outcropping in the Central and Central-Eastern Tur-key, is genetically related to the most economic and giant mineral deposits of Turkey, known as “iron district”. The famous Divriği iron deposits (Sivas) and Hasançelebi (Malatya) are related to the bi-modal A-type granitoids, and are hosted by, and associated with pervasively altered monzonitic rocks of that family. They either occur at the contacts between ophiolite-granitoid (Divriği district) or hosted by gabbroic rocks (Hasançelebi district) intruded by A type intrusives. The common feature of these deposits is a sodic metasoma-tism and potassic to sericitic alteration affecting both wall and host rocks. The iron occurs as magnetite which were later altered to martite, and veined by carbonate and sulfide minerals at the shallow settings or distal locations. These are classified these as Fe-oxide-Cu-Au family of deposits. However, the most typical mineralization of this sub-type of post-collisional granitoids is the quartz-fluorite veins and fluorite-gold occurrences exposed in various parts of Central and Central-Eastern Tur-key such as Bayındır-Kaman (Kırşehir), Kavik-Davulalan (Yıldızeli-Sivas), Tad Deresi (Akdağmadeni-Yozgat), Karake-ban (Divriği-Sivas), Kuluncak (Malatya), Keban (Elazığ) and Sivrihisar-Eskişehir regions among which those of the Sivrihisar, Karakeban and Kavik-Davula-lan deposits are also assemblaged with REE, U and Th mineralizations. Middle-Upper Eocene, post-collisional, exten-sional related, within-plate A-type gran-itoids outcrop both of the Anatolide and Pontide part the Neotethyan colli-sion system. The only mineralized gran-itoid outcrop belonging to this subtype is the Kösedağ batholith, consisting of syenite and quartz syenite intruding the Early to Middle Eocene volcano-sedimentary sequence which is a trans-tensional basin filling unit. The miner-alization related to Kösedağ batholith comprises the vein type Cu-Pb-Zn-Sb mineralization which is also associated with a broad hydrothermal alteration zone within the batholith itself.
ALKALINE RELATED PORPHYRY POTENTIAL OF CENTRAL ANATOLIAIn the view of descriptive model for alka-line related porphyry deposits, it should be suggested that some of the post col-lisional H-type and A-type igneous suites that co-exist in central Anatolia has po-tential that deserve further investigations. The key parameters that promote their alkaline related potential are; 1) tectonic setting of the intrusive suites, 2) potassic alteration, 3) structurally controlled phyl-lic alteration, 4) sheeted quartz-cabonate-barite-fluorite veins, 5) elevated F and Ba contents, 6) nepheline syenitic, melanite syenitic rocks hosting the alterations and veins, 7) intrusion of alkaline rocks into H-type K-feldspar megacrystic monzonitic rocks, 8) intrusion of mafic alkaline rocks, 9) occurrence of hydrothermal magne-tite either as veins or as disseminations in potassic zones, and 10) mixing and min-gling of mantle-derived mafic and crustal-derived felsic magmas. These parameters are likely to fulfill the requirements what define a district as alkaline porphyry. Therefore, the syenitic rock associations that intrude into the K-feldspar megac-rystic monzonitic rocks in central Anatolia are introduced as potentials for alkaline porphyry type mineralization.
The prospects associated with alkaline rocks of syenitic (felsic) and gabbroic composition intruding the H-type hy-brid K-feldspar megacrystic monzonitic associations are favorable targets for exploration if the alkaline rocks are sub-jected to veins of potassic (biotite, ser-icite, K-feldspar) alteration and dissemi-nated magnetite with or without pyrite mineralizations. The gold mineralization is hosted either by sericite-carbonate veins or K-feldspar-sericite-quartz veins.
The prospects that fulfill the above re-quirements and the requirements de-fined in typical alkaline related porphyry deposits class at the previous sections are mainly located within the Kırşehir district. Kaman and Kösefakılı provinces are likely to host these types of deposits (Fig.2). The syenitic rocks and syenite-related fluorite bearing magnetite-pyrite occurrences at Bayındır (isahocalı, Kaman, Kırşehir), Hamitköy (İsahocalı, Kaman-Kırşehir), Durmuşlu (İsahocalı, Kaman), Yeniyapan (İsahocalı, Kaman), Polatlı (Kösefakılı), Kösefakılı and Hallaçlı could be regarded as prominent prospects in terms alkaline-related porphyry potential.
Figure 2. The generation magmatic hydrother-mal fluids through H-type magmatism in central Anatolia
October 2014 41
VOLCANIC AND VOLCANOCLASTIC PROVINCES AS GUIDES TO POTENTIAL PORPHYRY AND EPITHERMAL MINERALIZATION Many ore districts in the world are located within the large cauldrons precluded their recognition by geologists working within the confines of a mining district. For ex-ample, Cu-porphyries in Summitville and Creede, Colorado and Julcani, Peru dis-tricts; High SiO2, F related Sn-W-U and Mo in porphyries in Questa, New Mexico and Taylor Creek, New Mexico; golden quadrilateral in Romania and Reko Diq in Pakistan. In the development of large ig-nimbrite cauldrons, the early caldera col-lapse stage disperses ore-forming trace elements but a later ring stage volcanism may develop conditions suitable for the concentration of the ore elements. If a caldera lake is present, the changes in the lake level can critically affect the position of the boiling zone particularly for saline lakes which are vital for potent miner-alization. As these districts are located commonly in a caldera moat widened by post-collapse erosion, the extensive caldera and ignimbrite occurrences in central Anatolia, formed at the expense of a continental extension during and after Mio-Pliocene, would be indicative of loci for potential mineralization in and around the calderas. The location calde-ras and volcanic centers and extrusion volcanics, dominated by tuffaceous units in Central Anatolia (which known as the central Anatolian volcanic province, CAVP, Fig.3) are controlled by transtensional pre-existing structures (Fig.3) related to late Alpine events. Since the pre-existing tensional faults may control the ascent of magma and the plan of caldera, these may become loci for mineralization. Lakes and aquifers in these settings can play the same role in providing fresh or saline me-teoric water to convecting hydrothermal system. Starting from Miocene to Late Pliocene, a lacustrine conditions domi-nated by isolated single or large lakes cov-ering the whole area in which the CAVP was formed, was prevalent. Therefore, it should be expected that the CAVP and cal-dera structures and ignimbritic sequences around these calderas may be important for potential mineralization. The volcanic eruption centers along the Tuzgolü strike-slip fault system are characterized by wide spread sericite-argillic alterations (Fig.3) that also host pyrite-veinlets. The altera-tions are observed as patches along the Tuzgolü fault zone suggesting that the
alteration is structurally controlled. There-fore, it is here suggested that the volcanic centers (Such as Acıgöl, Meke Maar, Cora Maar, Keçikalesi Caldera, Çömlekçi, Balcı Yakacık and Tepeköy eruptive centers in Aksaray and Nigde in central Anatolia should be explored for epithermal and porphyry (?) type mineralization.
RESULTSThe available database and observa-tions have revealed that the Central Anatolia has some potential in terms of intrusion-hosted gold and alkaline-re-lated porphyry gold type of mineraliza-tion. For the intrusion-hosted gold min-eralization, the potential candidates are mainly located around provinces where known Fe-W, Mo-W mineralization oc-cur. The alkaline-related porphyry gold potential is located mainly in the
districts where fluorite-barite, fluorite-goethite-carbonate veins within A-type alkaline nepheline-syenite, melanite sy-enitic rocks deposits are known.
Kuşçu and Erler (1998) have classified these skarns in Central Turkey as Pb-Zn, Fe, and Fe-W skarns mostly developed at the dual contacts consisting of gran-itoid-marble and granitoid-ophiolite. The classical skarn model does not exclude the probability of finding por-phyry mineralization beneath the skarn systems. Therefore, the Fe, Cu skarns of central Anatolia may also be associated with deep seated porphyry type miner-alization. The geochemical comparison of the skarn plutons in central Anatolia and world-class skarn plutons may help to delineate the porphyry potential of the plutons in central Anatolia.
Figure 3. Simplified geological map of the CAVP and main alterations along the fault zones (Modified from Toprak, 1998).
October 201444
In May 13th, Turkey’s worst mining disas-ter happened at Soma, in a private coal mine. As highlighted in our posts on the web site on the first day of the disaster, Mining Turkey Magazine intended to give the statements and updated news directly from the relevant governmental institutions and organisations so as not to mislead our readers with misinforma-tions. To this respect, we here try to give you through a flowchart the day-to-day news about the incident obtained from the reliables sources of institutions and authorities. As follows you can find the detailed information about the process from the first day up to date:
MAY 13, 2014A breaking news appeared on press reporting; at about 3:10 pm (GMT+2) at the mine’s shift change, a fire and ex-plosion occurred by a power distribu-tion unit (later though came out it was not the cause of the fire) at a coal mine owned by Soma Kömür İşletmeleri A.Ş. in Eynez region in Soma, Manisa. The miners trapped underground following the explosion, and came Turkey Energy Minister Taner Yıldız’s first statement:
“There is a serious situation due to the fire underground. Under the coordina-tion of Disaster and Emergency Man-agement (AFAD), a team of search and rescue experts from Turkish Hard Coal Enterprises (TTK) flew from Zongul-dak to Balıkesir. I hope the situation wouldn’t get worse. We have miners lost their lives. We will inform the pub-lic about the numbers after confirming the details from our sources. Our pri-ority is to rescue our miners trapped underground. We have rescue teams of experts in the incident area. The main issue for the rescue plan was to get clean air to the miners inside. Now fresh air is being pumped into the mine through ventilation system. We will give a detailed explanation in Soma. Whether it was negligence that caused accident or not be revealed after the in-spections and investigations.
President Abdullah Gül called Manisa Governor Abdurrahman Savaş to get the
information about the disaster and urge full mobilization for the rescue efforts.The mine’s owner Soma Kömür İşletmeleri A.Ş. made the first state-ment about the accident from its web site, said:“ An explosion at a power distribution unit started the blaze that lead to a terrible accident in our coal mines in Soma, Manisa. The accident occurred despite the “highest safety measures and constant controls” and an investigation is being launched. Our main priority is to get our workers out safely so that they may be reunited with their loved ones, their family and us. We keep the public uptaded about the recent news minute-by-minute. Unfortunately, we lost our workers in this painful accident. We pray for our deceased workers. Our condolences for our nation and their families.”
The first official statements from the re-gion were made by Disaster and Emer-gency Management Presidency (AFAD) at 10:00 pm (GMT+2), informing that 17 miners had lost their lives, 11 were injured and more than 200 miners remained trapped in coal mine underground.
MAY 14, 20145:00 pm (GMT+2) Turkey’s Energy Min-ister Taner Yıldız spoke the media about the updated facts in Soma, stating the death toll rose into 201, 80 workers were injured and the exact number of the miners still trapped inside remained uncertain. Yıldız added that 20 injured workers out of the 80 got injured after they joined the rescue operations.
After the painful accident occured in the coal mine in Soma, Manisa, The Prime Ministry declared three days of mourning starting from May,13 2014.
The prime minister Recep Tayyip Er-dogan, visited the mine in Soma and made a press conference Pointing to the accident as one of the worst di-sasters in the country’s recent history, Erdoğan said the death toll from the ac-cident rose to 238. He said the number of the injured was 80, 19 of the whom had been discharged, and the number
of discharged workers would increase every passing hour.PM Erdoğan sent his prayers for the deceased miners and condolences for their families and Turkish nation. “All state organizations and every means available were mobilized for this pain-ful disaster. The investigations were be-ing launched about all the details in the accident. We will not tolerate any neg-ligence to be ignored. The case will be enlightened, we will take every steps needed to satisfy the families and the public.” said Erdoğan.
At the end of the conference, PM an-swered the questions of the journalist. A journalist asked Erdoğan: “The main opposition Republican People’s Party (CHP) submitted a motion to Parlia-ment to investigate work-related ac-cidents at the mine in Soma, yet the proposal was rejected with votes from the Justice and Development Party (AKP). What would you like to say about this?”. Erdoğan answered the question saying that the proposal made by the opposition had had only aim but to di-vert the parliament’s daily agenda, and added the Soma mine hadn’t taken any part in the proposal except for the title. During the session, the Al Jazeera re-porter asked the Prime Minister about the responsibles of the accident: “How can an establishment working in such potentially dangerous conditions with-out any emergency preperations be al-lowed to operate? Who is really respon-sible for this accident?” PM Erdoğan answered the journalist as: “I guess, as a journalist you don’t follow closely how coal mines work around the world. It may be because there are natural gas reserves, but not coal mines in Qatar. I am going to give you some numbers so that you can clear out the case.”
Erdoğan in his response cited mine ac-cidents from England dated to 1862, 1866 and 1894, and 20th century mine accidents from France, the USA, Japan and China. “Explosions like this in these kind of mines happen all the time. It’s not like these don’t happen elsewhere in the world. These kind of
What Happened in Soma?
Documentarywww.miningturkeymag.com
October 2014 45
occupations bear these work accident risks. Of course, we are deeply sorry for this huge tragedy. In March, this mine was inspected in regards to health and security and was confirmed to have been successful in regards to workers’ health and workplace safety.” said the Prime Minister.
After PM Erdoğan’s press conference, the main opposition Republican People’s Party (CHP) objected PM’s statements about the Soma motion submitted by CHP, declared that his statements were not reflect the reali-ty about the case. CHP officials shared the motion with the public. As seen on the shared document,the mo-tion proposed to the parliament on June 29, 2014 was about specifically the mine accidents occurred in the mines owned by a private company in Darkale village of Soma district. CHP demanded an investigation into all the mine accidents in Soma to reveal the reasons and those responsible for the deaths in those accidents, to find permanent solutions to prevent these cases repeat, and to measure the suf-ficiency of the law enforcement and auditing of these institutions.
Soma Kömür İşletmeleri also made a statement about the latest news from the mine: “ Started from the time the fire broke out, our teams have been working on clearing the mine from the carbon dioxide and carbon monoxide gases alongside the rescue operations. We are in deep sorrow for the loss of our 238 workers. Owing to the emergency rescue operations, nearly 450 workers have been rescued. The searches and investigations as to the cause of the fire are in progress. We will share the reli-able information with public as soon as we get the results. We don not know the exact cause of the fire yet.”
Energy Minister Taner Yıldız in his state-ment at the evening hours announced that the death toll rose to 274. Meanwhile, the Chairman of Soma Holding Alp Gürkan made his first statement, denying the accusations of using poor quality products in the power unit.
MAY 15, 2014 8:30 am (GMT+2) Energy Minister Tan-er Yıldız spoke to the press reporting that no miners were found alive for
the last 12 hours and the death toll rose to 282.
President Abdullah Gül visited the city and join the researches in the accident area. In his statement to the press, Gül said that the mine fire was a sorrow for the whole Turkish nation. The President added that all state organizations and every means available were mobilized for the rescue operations, and an inves-tigation had begun which would shed light on what regulations were needed. Sending his condolences for the de-ceaseds’ families and Turkish nation, Gül noted: “We as whole nation should show a huge solidarity to bind up the bounds.”
Following President Abdullah Gül’s speech, Energy Minister Yıldız informed the public the updates about the res-cue operations in the mine accident. Yıldız said that the number of the loss remained the same as 282, and the operations to control the fire were still continuing in the mine. Yıldız: “There is a significant decrease in the amount of carbon monoxide gas in the mine. With the decrease in carbon monoxide, we can speed up the rescue operations inside in the following hours.” In his
Source: stargazete.com
October 201446
speech, Yıldız noted that an administra-tive and judicial investigation had been launched and the administrative part was being carried out by both the Minis-try of Labour and Social Security and the Ministry of Energy and Natural Sources.
MAY 16, 2014In his speech in the early hours, Taner Yıldız stated that the death toll rose to 284, and there were still maximum 18 miners trapped inside. Yıldız added that based on families’ testimonies the maximum number of the miners lost their lives would be 302.
Soma holding CEO Alp Gürkan, General Manager of Soma Kömür İşletmeleri A.Ş. Ramazan Doğru and the operating manager of Eynez Kömür İşletmesi Akın Çelik made a press conference regard-ing the incident.
In the press conference, it was informed that there were 787 workers inside the mine when the accident occurred; 363 miners, 122 of which were transferred to the nearby hospitals, were rescued alive, 284 workers had lost their lives and 18 workers remained trapped in-side the mine, still being searched.
Making his statement about the ac-cident, Soma Holding CEO Alp Gürkan said that: “I have spent all my income from mining business to improve work-ing conditions in my working fields. I
was informed about the accident at about 3 pm on Tuesday. I couldn’t be-lieve my ears. I couldn’t figure out how this could have happened. I just thought about the impossibility of an explosion in a power distribution unit. I feel deep sorrow. People who know me would understand how sensitive I am about these issues. The workers in this mine are mostly the children of the miners who I worked with in my former mines. As a miner of 49 years experience, I can not figure out this accident can happen.”
Following Alp Gürkan’s speech, General Manager of Soma Kömür İşletmeleri A.Ş. Ramazan Doğru said: “First of all, I ex-press my condolences to every member of our nation. We faced a painful disaster in our coal mine at 3.30 pm on May,13. I have been working in this basin for 25 years. I’m a mining engineer. I know all the people we lost personally. Before the accident, the number of workers here in our mine was 2.941. We have totally 6.000 workers together with our other entities in the region. When the investi-gations end, the cause of the accident will be enlightened by the experts.”
Continued his speech giving details about the accidents, Doğru had also difficult times answering the pressing questions of journalists. Ramazan Doğru said that the accident broke out in the drift called as the 4th belt on the -140
level of the mine and it was caused by an undetermined spark. “There was a strong entry of clean air there that led the coal vein burn and the coals scat-tered around started the fire in the mine.”
The Operating Manager of Eynez İşletmesi Akın Çelik spoke to the press about the facility and the incident:“I have been a mining engineer for 20 years and also been working as safety specialist for 15 years. In coal mining, a coal fire can easily be extinguished. In case of a fire, the area is filled with ash and water com-pletely. The presence of coal gas inside the mine is out of question. These gases are controlled constantly by stable and mobile sensors. We haven’t found out yet how the fire started. We cannot an-swer this question now. We have never seen anything like this.” While the re-porters bombing Doğru and Çelik with their questions, the company managers noted that there was an existing rescue chamber remained from Turkish Coal Enterprises (TKİ) at the mine’s upper lev-els which had been disassembled as pro-duction there had stopped, and work on a rescue chamber near the working spot at the lower section was on the way. Doğru and Çelik added that there were emergency rescue clearings in the mine with a direct link to ventilation and clean air. Thanks to these, many workers were able to escape from the mine when the fire broke out.
Source: aljazeera.com.tr
October 2014 47
The officials from Soma Holding stressed that there were no subcon-tracted, uninsured and illegitimate workers in the company and all the workers were the employees of Soma Kömür İşletmeleri A.Ş.
The press conference was held in a tense atmosphere in which the intense conversations between the press mem-bers and the company officials mini-mised the efficiency of the event.
MAY 17, 2014In his last statement, Energy Minister Taner Yıldız informed that the number of the workers lost their lives rose to 299. According to Yıldız’s statement, a new fire broke out in another sec-tion of the mine, about 250 metre (820 feet) away from where the miners were trapped and that would create further difficulties for rescue teams.
In the evening hours,Taner Yıldız re-ported an update that two or three miners were still thought to be un-derground and 301 miners lost their lives while 485 miners either escaped or been rescued since Tuesday’s mine blast and fire in Soma. The search and rescue operations ongoing for 5 days were completed, reaching all the min-ers in the drifts underground.
MAY 18, 201425 people held on suspicion of neg-ligence as part of the investigation into the mine disaster in Soma. Soma Holding CEO Can Gürkan,and Rama-zan Doğru, the general manager of Soma Kömür İşletmeleri AŞ, and opera-tions manager of Eynez İşletmesi, Akın Çelik, were among those being held on suspicion of “neglect and causing multiple deaths”. 6 of the 25 suspects were brought to the court and 3 were arrested.
MAY 19, 20148 people were arrested and 9 were released on probation within the investigations in the mine disaster which took the lives of more than 300 miners. Among those arrested on Sunday were Soma Holding CEO Alp Gürkan’s son Can Gürkan, the company’s general manager Rama-zan Doğru and the mine’s operations manager Akın Çelik, mining engi-neers Yalçın Erdoğan and Ertan Er-soy, shift supervisors Yasin Kurnaz
and Hilmi Kazık, and the mine tech-nician Mehmet Ali Günay.
MAY 26, 2014Miners’ Protests in Soma Still Continues13 days have passed since the disaster in Soma district of Manisa, yet the min-ers demanding improvements in their working conditions refused to go back to work in the mines. Despite the work-ers’ demands on the improvements in the working conditions, the company of-ficers of Soma Kömür İşletmeleri AŞ were claimed to have sent SMS to the workers to start work on May 26, Monday.
The miners who refused to start work in the mine gathered in front of the Ege Office of Turkey’s Mineworkers Union and called for the union board mem-bers’ resignation. It was reported that a clash erupted between the police and the miners, and one police got injured in the muss.
Upon the workers’ protests, Turkey’s Mineworkers Union Ege Office Chair-person Tamer Küçükgencay and five board members subsequently of-fered their resignation. Following the ongoing protests, Soma district Gov-ernor Mehmet Bahattin Atçı made a statement declaring the activities in Atabacası Mine, another mine in the region operated by Soma Kömür İşletmeleri AŞ, were being terminat-ed by Labour Inspection Committee of The Ministry of Labour and Social Security.
MAY 29, 2014Production in Işıklar Mine in Soma was HaltedFollowing the mine disaster in Soma Eynez Underground coal mine owned by Soma Kömür İşletmeleri AŞ, the operations were halted in the Işıklar coal mine, run by the compa-ny, by Labour Inspection Committee of The Ministry of Labour and Social Security on May 28. The announce-ment was made by Soma district Governor Mehmet Bahattin Atçı. The Işıklar mine closure followed the clo-sure of two other coal mines in the region, Eynez and Atabacasi, which were also operated by Soma Kömür İşletmeleri AŞ. Atçı added that the miners would get their payments and social security premiums during the closures.
A Commission of Experts Contin-ues the InvestigationsSoma Public Prosecution established an investigation committee to investigate the explosion in Soma coal mine. The investigation committee comprised of four experts (Mining Engineers, Elec-trical Engineer, Safety Specialist) was continuing their researches and they hadn’t exhibit the reasoned expertise to the case file yet. Whether the Union Authorities were responsible or not for the accident was being searched by Soma Public Prosecution.
JUNE 9, 2014Parliamentary Investigation Committee Launched the ResearchesThe parliamentary investigation com-mittee set up to investigate the mine accidents, Soma disaster notably, and to determine the safety measurements, launched their researches in Soma dis-trict of Manisa. Ali Rıza Alaboyun, Aksa-ray deputy of Justice and Development Party (AKP) is chairing the investigation commission. Alaboyun made a sate-ment noting that they would be carry-ing searches and investigation for two days in Soma. He said that their intend was to descend to the mines, yet the two exits of the mine was closed due to the technical reasons and the ongoing fire inside. Head of the Commission Al-aboyun added that as soon as the fire extinction was completed, they would go in to the mines.
JUNE 9, 2014The First Cautionary Judgement Passed in SomaSoma Civil Court of General Jurisdiction issued a precautionary injunction on the assets and properties of the sharehold-ers of the Soma Kömür İşletmeleri AŞ.
The lawsuit was filed by the families of the deceased workers. The court ac-cepted the case and issued a precau-tionary injunction on the assets and properties of the shareholders of the Soma Kömür İşletmeleri AŞ. The court also put a seizure on the registered assets of the company, ruling that TL 200.000 be deposited in Ziraat Bankası.
The lawyer of the deceased worker’s family Hakan Kahraman said the rul-ing was very important in forming a precedent for other compensation files against the company by the
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victims’ families. He added that the court treated the claims with meticulous at-tention and thus issued a precautionary injunction against the company.
“The amount of compensation to be taken in all the cases to be opened in the name of other families has been guaranteed with such a decision,” Kah-raman said.
JULY 1, 2014Labour Courts being Constituted after Soma DisasterAfter the mine disaster in Soma district of Manisa, hundreds of lawsuits for dam-ages as well as the prosecution were con-stituted against Soma Kömür İşletmeleri AŞ. About 6.000 workers serving in the company were also claiming lawsuits against the company which put the Su-preme Board of Judges and Prosecutors (HSYK) in action. Upon Manisa Bar As-sociation’s application, HSYK decided to constitute a labour court in Soma which had no labour courts yet and appointed two judges (one of whom was from Su-preme Court of Appeal) there.
The families of the workers who had lost their lives brought hundreds of ac-tions for damages against Soma Kömür İşletmeleri AŞ. Besides, about 6.000 workers serving in the company and the employees working in different fields in the region were also claiming lawsuits against the company, which re-vealed the need for specialised courts.
JULY 7, 2014Images Recorded During Soma Disaster RevealedThe shots captured from the images re-corded by the cameras before and dur-ing the disaster showed us the tragedy inside the mines minute by minute. The images were filed in the criminal reports. After the fire broke out and smoke im-mediately began to fill the air, many workers moved forward to the exit. As minutes passed by, workers in state of exhaustion and some losing conscious-ness could be seen in the images.
Some of these fainting workers were captured in the images trying to sur-vive with the help of coal conveying belts or with their friends.
JULY 18, 2014Fire Continues in Soma Coal MineOne of the exits of the Soma coal mine,
where 301 workers had lost their lives, was opened by courtesy of Prosecu-tion. The measurements inside showed that the carbon monoxide gas was still above 550 PPM due to the ongoing fire.The investigation inside confirmed that the mine was not suitable for research activities of the experts. The exit was closed again with concrete wall. It was announced that the teams would wait for another two months before making their researches in the mine.
JULY 23, 2014Chamber of Mining Engineers - Soma Disaster MemorandumThe Chamber of Mining Engineers of Turkey released the Soma Disaster Memorandum about the tragedy took place in Soma on May 13, 2014 causing the demise of 301 coal mine workers and 5 mining engineers. The Chamber’s press release was served in a press con-ference on July 23, 2014.
AUGUST 30, 2014Expert Report on Soma Uncom-pletedThe expert report on the disastrous accident in Soma coal mines in which 301 miners had lost their lives couldn’t be completed in its due date August 30, 2014. The announcement of the expert report was postponed to a later date. The experts committee entered the mine both 4 days and 2 months after the accident, and start-ed to write the report, yet the com-mittee asked prosecution for time un-til August 30 to make a report about
the case in detail. As the expert re-port’s completion was postponed to a later date, the prosecution process about the accident couldn’t begin be-fore January 2015.
SEPTEMBER 2, 2014The First Lawsuit for Damages Heard in SomaThe wife of deceased worker İsmail Değirmen aged 27, Gamze Değirmen, filed a lawsuit in the Soma Civil Court of General Jurisdiction against Ae-gean Lignite Enterprises, a branch of Turkish Coal Enterprises (TKİ), and Soma Kömür İşletmeleri A.Ş. for mate-rial and moral damages. She request-ed a total of 390.000 TL, 150,000 TL for herself and 120,000 TL for each of her two children, for non-pecuniary dam-ages and a total of TL 3,000 for pecu-niary damages.
SEPTEMBER 10, 2014The Omnibus Bill Passed Parlia-mentThe Omnibus Bill, including those relat-ing to the mining industry which were tabled after the coal mine disaster in Soma that killed 301 miners and the appointment of teachers, and contact labouring passed parliament. The leg-islation also included amendments to laws regarding mining and structuring of state holdings. The amendments re-garding the mining industry in the leg-islation were as follow:
The retirement age for mine workers will be reduced to 50 from 55.
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The employers with 10+ employees will have to assign a job security expert, a doctor and health staff. The interns and apprentices in student status will not be added to the total number of em-ployers.
Due to the Occupational Health and Safety Management, the medical re-ports will be received from the occupa-tional physician. For the less dangerous workplaces with less than 10 workers, the medical reports can be received from public utilities or primary care physicians.
Paid leave, annual leave, the period of preparation before and after work and national holidays, education and course duration will be counted as working time for labourers who are insured to work in areas such as mines (except for mercury mines with ele-mentary mercury) and tunnel and drain construction sites. The families of the workers who lost their lives in Soma mine disaster will re-ceive a ‘death’ salary regardless of their monthly income. The insurance debts of the miners who lost their lives in the coal mine accident in Soma will be canceled. One of the relatives of each Soma victim will be provided with a right to work in state institutions. No certificate of indi-gency is required for the parents who will receive salary. The regulation will be valid as of the date of May 13, 2014.
The labourers of the mines where lig-nite and hard coal is drawn won’t be paid less than the double of the mini-mum wage.
The legal heirs of each Soma victim will receive a housing supplied by philan-thropic organisations, corporations and businessmen. Disaster and Emergency Management Presidency (AFAD) will provide immovable property for the housing. These housings will be sub-mitted for free to the legal heirs of the victims via casting lots.
The seniority requirement will be re-moved for the labourers working un-derground.
Employers will be in charge of the pay-ments of the workers who work under the subcontractors. Employers have to check the subcontractor’s payments to
the workers, and compensate for the missing ones.
The workers in underground mines will be paid double hourly when the legal work hours of 36 hours exceeds in ex-traordinary situations. Paid annual leaves of underground workers will be extended 4 days more. Thus, a labourer working underground for less than 5 years will have a mini-mum of 18 days paid annual leave.
The workers whose subcontractor changes in his workplace have right to use their paid annual leave calculated with regard to their working days in the same workplace. The primary em-ployer have to check the annual leaves of the workers, and make sure they use their rights in the related year. The subcontractor have to give a copy of the annual leave records to the pri-mary employer.
The working time of the miners will not exceed 36 hours a week and 6 hours a day. The related regulation will become valid on January 1, 2015.
SEPTEMBER 19, 2014Expert’s Report on Soma Delivered to the ProsecutionAccording to the report signed by commission of experts, 20 instances of gross negligence which led to the acci-dent were identified.
1. Employer ( Chairman of the Board)2. General Manager, Operating Manager,
Operating Assistant Manager3. Mine Supervisor, Technical Supervisor4. Technical Supervisor
A significant determination in the re-port was that the amount of coal Soma Kömür İşletmeleri contracted with the state to produce until 2017 had already been produced 3 years earlier.
The determinations about the negli-gences are as follows:
• The gas masks given by the company were not periodically inspected ac-cording to the regulations. Institu-tion of Forensic Medicine also con-firmed that 85% of the 301 victims were killed due to carbon monoxide poisoning.
• The ventilation system did not meet the requirements of a coal mine at
that size. It should have been reorgan-ised. There were huge differences be-tween the ventilation systems inside the mine and the ventilation plans given to the experts committee.
• The 4 km long system which supply the mine with clean air was not suf-ficient enough.
• The register books, in which the car-bon monoxide gas, oxygen, coal gas measurements were recorded, were not filled regularly. The measure-ments from early days were found to be copied randomly.
• Most of the gas sensors in the mine (48 gas and 19 carbon monoxide gas sensor) were malfunctioned. The sen-sors had calibration problems and could not read the datas properly.
• The carbon monoxide gas and tem-perature inside the mine were get-ting higher making the working conditions unbearable since last February. Yet, the company officials in charge of security had not halted the production.
• TKİ, which was the employer and also in charge of supervision of the facil-ity, did not take the measurement as stated in Mining Law. The numbers and reliabilities of the gas sensors, data transmission systems were not supervised by TKİ.
• MTA (Mineral Research & Exploration General Directorate) violated Min-ing Law, not including the electricity projects in the mine into engineering services. The workers were not given adequate training about occupation-al health and safety.
• The coal inside the mine was burn-ing, and the gas sensor controlling the air warned from the beginning. Yet, the situation was not handled with care by the company officials.
• Ventilation method and system were not appropriate for a coal mine with risk of fire. The ventilator and the as-pirators were not qualified to be air flow reversers in case of a danger. This affected the rescue operations negatively.
• The calibration of the gas sensors in the mine were not done by accred-ited bodies.
• The communication line could not be used during the accident because the communication equipments were not confirmed to standards re-quired underground.
• There was not a proper evacuation plan in the workplace.
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TABLE OF CONTENTS
This report was researched and prepared by Global Business Reports (www.gbreports.com) for Engineering & Mining Journal.
Editorial researched and written by Alice Pascoletti and Amelia Salutz.
For more details, please contact [email protected].
May 2014
Cover photo courtesy of Spektra.
a REPORT By GBR FOR E&MJ
Turkey’s mining industryA new day for mining dawns for a fast-growing regional power
Turkey: an overview...........................................p52Interview with Minister of Energy and NaturalResources, Taner Yıldız......................................p53 Turkish mining regulations and financing............p54 Gold: Turkey’s crowning resource......................p56Base Metals.....................................................p61Coal...........................................................p65Developing a Strong Supplier Base....................p67
October 201452
While the world’s traditional mining markets struggle through the trough of a mining cycle, Turkey has emerged as a rare story of growth, offering a compelling jurisdiction to international mining investors in pursuit of friendlier skies. To date, the country has not shown huge ore deposits of blockbuster potential; rather its key attractions are economic discoveries ranging across 72 mineral types, situated in an open playing field with attractive incentives and a growing supplier base to assist in low cost project execution.
Aiming to become a top 10 global economy by the 100th anniversary of the Turkish republic in 2023, Turkey has set its sights on reaching $500 billion in exports, $15 billion of which is earmarked to come from the mineral sector. With this am-bitious goal in mind, the country is looking beyond the state-
Turkey: An OverviewA rising mining market emerges in a challenging global context.
owned entities and domestic conglomerates that have largely fu-eled the industry thus far. Foreign investment will play a decisive role in meeting this goal, or falling short of the mark.
As the government continues its privatization process that began in the early 2000s, private companies have brought increased production rates and higher profits to a stagnant industry. Today the sector is over 85% privately-held, posting modestly healthy growth rates such as 4.6% in 2012, even as the global mining downturn began.
“Today just 10-15% of Turkey’s mining operations belong to public bodies, such as Turkish Coal Enterprises (TKI), Turkish Hard Coal Enterprises (TTK) and ETI Maden. In the future, this ratio will be even smaller. We are ready to increase foreign mining companies’ share in our country. To encourage these foreign com-panies, the Ministry of Economy has established new incentive schemes for strategic investments,” said Nevzat Kavaklı, deputy undersecretary of the Ministry of Energy and Natural Resources.
Although the government is keen to support the sector with attractive incentives, as with any developing mining jurisdic-tion, a steep learning curve persists for policymakers bogged down by wider political and economic turbulence. Delays in forestry permits and a lack of clarity in regulatory implementa-tion have slowed the sector’s dynamic growth. Fraser Institute surveys placed Turkey 53rd in 2013, while 2014 results show improvement with a climb to 37 out of 112 jurisdictions. To continue on its upward trajectory, the sector is focused on lur-ing in more foreign juniors and bringing the practices of its domestic players up to international standards.
Turkey’s fast growing economy, boasting a GDP that has tripled since 2003, its young population with a median age of 29, and its central geographic positioning lend the mining sector strong fundamentals for growth. A period of wider economic uncertainty, which emerged in 2013 with the Gezi Park protests and an on-going high-level government corruption probe, has been slightly abated by the highly anticipated local elections in March 2014, bringing indications for the August presidential elections and gen-eral elections in 2016. Investors have opted for a wait-and-see mode as the country tests the boundaries of its democratic pro-cess, yet stay at the ready for the green light to reactivate Turkey’s booming mining story.
Divrigi open-pit iron ore mine. Photo courtesy of Çiftay.
MiNiNg iN TurkEy
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InterviewInterview with Minister of Energy and Natural Resources, Taner Yıldız
Turkey improved significantly in the 2012-2013 Fraser Institute rank-ings. How are these improvements reflected in the recent growth fig-ures of the mining industry?Turkey ranks 10th in the world in the di-versity of its minerals; however until 10 years ago the mining sector in our coun-try could not reach its real potential. We, as government, have implemented the necessary legal arrangements for the mining sector to come to the place it de-serves. Today, we know that 77 of the 90 types of minerals traded in the world are located in Turkey and approximately 60 of these minerals are produced here.
Please provide us with a brief over-view of the main pieces of legisla-tion governing sector licensing as they have evolved over time?In 2004, with the enactment of Law No. 5177, the licensing process in Turkey was reformed to reduce bureaucracy in the sector. This increased the demand for mining license; however the absence of application criteria and the low cost of obtaining licenses have led to a high number being granted for speculative purposes and not exploration. As a result of this demand, the number of licenses rose to 45,900 in the early 2000s.
This created problems in the sector that were addressed with mining law No. 5995, which came into force in June 2010 and rearranged the length and requirements for the application and ex-ploration periods. This reform removed the presence of speculative licenses and
paved the way for more exploration ac-tivities. After introducing this new law, private sector firms have significantly promoted exploration activity.
Following the enactment of Law No. 5995, the number of licenses has dropped from 45,900 to 23,475 as of December 31, 2013. This is a direct result of the elimination of investors who are not inter-ested in actual exploration activity. While the number of license applications in 2010 dropped to 4,342 after the new law, they have since risen to 7,400 in 2013.
What is the importance of mining to the national economy and how do you envision its potential role as a growth driver going forward?The mining sector’s GDP in 2003 stood at about $2.6 billion; in 2012 it amounted to about $11.71 billion. By the end of 2013, it reached nearly $12 billion. Based on this data, mining’s share in GDP has in-creased nearly 4.6 times in the past 10 years. There has been similar growth in mining exports, which in 2003 amounted to $841 million and increased six fold to reach $5.1 billion by the end of 2013. We see these figures increasing going forward as the sector aims to reach its goal of $15 billion in mineral exports by 2023, the 100th anniversary of the republic.
What steps is the government taking to advance exploration and improve the industry’s understanding of its under-ground potential?The amount of meters drilled in Turkey reached 1.5 million m in 2013, a significant increase compared to 100,000 m in 2002. Coal reserves have increased from 8 billion mt to 14 billion mt thanks to the new coal reserves identified by General Directorate of Mineral Research and Exploration (MTA).
What is your outlook for Tur-key’s mining industry in the near term?Turkey aims to advance its mining sector which has good conditions today. In this context, we plan to raise the value of min-ing exports to $20 billion from the current $5.1 billion in the next decades.
MiNiNg iN TurkEy
October 201454
Turkey’s mining code was most recently reformed in 2010, with the aim of clarifying the environmental permitting pro-cess and to discourage prospecting by instituting financial re-quirements and implementing a three-step exploration process complete with check-ins from authorities.
Regulations have not been significantly changed since then; however, questions of implementation and rule of law continue to challenge the sector. For a sector that has long been on the backburner of government policy, its emergent presence on the national stage has led to growing pains. Accounting for roughly 1.5% of GDP, the mining sector has a long way to go to gain a greater voice in the policy making process.
Güven Önal, chairman of the Turkish Mining Development Foundation, argues that official statistics do not tell the whole story of mining’s importance to the national economy, a fact which is decreasing the sector’s influence over policy. “The con-tribution of mining to GDP should be 1.5% in 2013; however the calculation of these figures does not give the whole picture of the industry. Mining exportation includes only raw material and does not take into account integrated mining activities, such as glassworks, ceramic works, cement, boron chemicals, cop-per, aluminum and power from the coal,” he said.
“If we consider raw material production in Turkey and the contribution of integrated mining, this will lead to the real figure for its share of GDP. Out of production in 2011, the integrated value was $25 billion out of a GDP of $750 billion, making the
Finding its voiceTurkish mining regulations and financing
mining share 3.3%. The lower estimation of mining’s contribu-tion has an impact with NGOs and public relations,” said Önal.
A light at the end of the tunnel for permittingAs evidence of the crucial need for a greater political voice on behalf of Turkey’s miners, a significant bottleneck emerged for the industry in 2012, when a circular was issued by the prime ministry dictating that approvals for the use of governmental lands were to be routed through the prime minister’s office. As a result, the mining sector saw a nearly two-year period of stagnation as forestry permit delays stalled exploration and threatened the industry’s project pipeline.
Uncertainty of the application of the circular abounded and spurred collective action on the part of industry stakeholders.
“The circular issued in 2012 is vague and can be interpreted in many different ways. Recently, there has been a case, in which the circular was overruled. An applicant filed a lawsuit after the Ministry rejected the license application based on the circular. The court ruled that the legal right granted by a law cannot be limited by a circular,” said Şebnem Önder, partner at Akol Law Firm.
While explorers and producers hoping to expand their op-erations have been forced into a waiting period, they have had the chance to hone their projects and prepare for swift execu-tions of their drill programs once given the go-ahead. After a tense period, positive signs have brought investor confidence back to the market when, in advance of local elections held at the end of March, over 50,000 permits were sent back to the Ministry of Energy and Natural Resources for evaluation. As permits begin to receive ministerial approval, explorers and their service partners are hungry to get exploration re-started.
Reform initiatives to boost miningThe permitting delays have propelled discussion on further mining reform, prompting the industry to reach out to poli-cymakers to better address the specific needs of their sector.
“Turkey has high potential in mining, but it needs a new legislative base in order to accommodate such a transition. The government is actively working on introducing tax incentives for foreign investment. The recent depreciation of the Turkish lira and internal political disturbances have slowed down this pro-cess, but we are confident the situation will improve towards the end of 2014,” said Baran Baycan, partner at Baycan Law Firm.
Allegations of corruption among high-level government officials have rocked Turkey since December 2013 and the Turkish lira’s val-ue spiraled downward until the Central Bank raised interest rates in January 2014 in an emergency move that stymied its depreciation.
“In order to attract and retain foreign investors, we must pro-vide investment incentives and tax advantages to local and inter-national mining companies operating in Turkey. Turkish mining legislation has been updated regularly since 2005 to include such advantages, but there is still a long way to go,” said Baycan.
A first step will be improving the framework for exploration. Current license periods make it difficult for explorers to carry out adequate research and the industry is advocating for an exten-sion of exploration periods. “We are currently negotiating with
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the authorities to extend the exploration period from seven to 10 years for Class IV mines. The current period does not provide enough time to properly identify a gold reserve,” said Ümit Akdur, chairman of the Turkish Gold Miners Association.
For producers, a more advantageous scheme of incentives exists. “Compa-nies operating in mine extraction and/or processing have a number of incentives, including VAT and customs exemption, reduced corporate tax rate, social security premium support, interest support, land allocation subsidy, insurance premium support and income tax withholding al-lowance,” said Tolga Taşdelen, director of tax services at PwC Turkey. “Addition-ally, wages of those employed in mines in the form of an underground operation, in ore production and in all related work, pertaining exclusively to the time they are employed underground, are exempt from income tax and stamp tax.”
As Turkey adheres to EU accession guidelines, policy has been directed at better regulating its industries and im-proving their best practices. “The mindset in the industry has developed since the government started changing the laws and putting pressure on exploration and mining companies to meet international standards and report resources and re-serves in a proper way,” said Muhanned Arar, managing director of consulting firm Almina Minerals and Metallic Group gen-eral manager at Yildizlar SSS Holding, Turkey’s only silver producer.
Accessing capital: Turkey’s appetite for mining financingTurkish conglomerates are bringing much-needed capital to the sector, however its path towards maturity will depend heavily on its ability to attract foreign investment. When Turkey first opened up its doors to foreign investment just over three decades ago, investments coming from abroad
totaled only $18 million. In 2013, that number has risen to $138.3 billion.
Although M&A in 2014 is forecast to drop to below half of its 2013 lev-els, opportunities abound in the market for companies with a high risk appetite. “The Turkish Republic is in need of FDI because of the large deficit in the national budget. The financing of this deficit, given the volatility with the Turkish Lira, and lower GDP growth, will have an effect on the country. Therefore, any interna-tional company looking to invest in Tur-key is going to be regarded as a friend,” said Zeynep Dereli, managing director of APCO Worldwide Turkey, a global strate-gic communications and advisory firm.
Because local banks have not displayed an appetite to finance mining, companies must rely on private investors, although the industry remains hopeful local banking in-terests will change. “Banks and financial in-stitutions should focus on how they can cre-ate financial tools for mining and determine what the industry means to them in terms of revenue,” said Şafak Herdem, managing partner at Herdem Attorneys at Law.
One rare example of local mining fi-nancing comes from DenizYatırım, the investment arm of Turkey’s fifth largest privately-owned bank, DenizBank. As of 2013, DenizYatırım entered into a stra-tegic collaboration with Dedeman Hold-ing as its house bank to help finance its tourism and mining projects. “Within this framework we provided Dedeman Hold-ing with M&A advisory services. We were given the task of optimizing the company’s structure to help fuel its growth and ensure that the loan is paid back in an efficient manner,” said Emrah Çelebi, M&A division head for corporate finance at DenizYatırım.
The high risk nature of the industry has made it less attractive to local finance; however on a global scale Turkey’s mining market has several risk mitigation advan-tages. In 2013, Ernst & Young identified the top three global risks for mining as resource nationalism, skill shortage and infrastructure access. On these fronts, Tur-key is relatively well-positioned; rather risk comes in on a policy level.
“Turkey is suffering from a delay in in-vestment, often related to political issues. Infrastructure access in Turkey, compared to some of the developing countries, is among the best and there is no skill short-age thanks to the number of universities,” said Hakan Kayganacı, managing director of the risk management practice at insur-ance broker and risk adviser Marsh.
Baran Baycan, founding partner, Baycan Law Firm.
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Kışladag gold mine at Uşak. Photo courtesy of Tüprag.
As gold producers struggled globally through price drops in 2013, Turkish gold producers reached peak production with an output of 33 mt. Turkey entered into full-scale commercial production only 13 years ago and today is Europe’s top gold producer, with eight mines and several near-term developers waiting in the wings.
Representing the sector since 2006, the Turkish Gold Miners Association and its 24 members have supported the coun-try with significant investment. “Over the last 28 years, our members have invested some $2.5 billion in Turkey. Of that in-vestment, $800 million was for explora-tion and $1.7 billion was in mining. In 2013, we produced 33.5 mt of gold, which created some 6,000 jobs,” said Ümit Akdur, chairman of the Turkish Gold Miners’ Association.
“We expect to increase gold production to 50 mt by 2016. However, there are a number of challenges which may prevent the industry from achieving this. Lower gold prices and deferrals in permitting, especially forestry permits, have put a lot of pressure on mining companies,” said Akdur.
Nonetheless, forecasts for gold pro-duction in 2014 are set at 35 mt. This higher output is thanks to Turkey’s lead-ing gold producers’ continued expansion efforts. In 2013, Turkey’s first domestic gold producer, Koza Gold, commenced construction of its Himmetdede mine and heap leach facility in the Kayseri Province. Entering into production within 2014, the operation will be the fourth process plant of Koza Gold and the third constructed in the last five years.
At ASX-listed Alacer Gold’s 80%-owned Çöpler mine, the miner achieved a record
GoldTurkey’s Crowning Resource
year of gold production in 2013, with 216,850 attributable oz produced in a 44% increase over levels in 2012. The company has forecast production in 2014 to be greater than 160,000 attributable oz as the miner transitions from mining oxide ore to sulphide ore.
For its part, Tüprag, the Turkish sub-sidiary of Canada-based mid-tier Eldora-do Gold, is currently producing 300,000 oz/y of gold at its Kışladag and Efemçu-kuru operations. Pending permitting ap-proval, Tüprag will significantly increase its capacity with a plan to increase its processing up to 35 million mt/y of ore. “The proposed expansion in Kışladag will contribute greatly to the gold sector’s goal of reaching 50 mt/y by 2016,” said Mehmet Yılmaz, director at Tüprag.
Digging for goldGiven gold’s impressive growth story in Turkey, international juniors have clam-ored to enter the market while Turkey’s conglomerates and construction compa-nies eye gold potential.
Ümit Akdur, chairman, Turkish Gold Miners Association.
Chesser Resources, an ASX-listed ju-nior, is concentrated on its flagship Kesta-nelik project, an epithermal low sulphida-tion gold project in western Turkey. With over 70,000 m drilled on the project to date, Chesser is now planning for the completion of its prefeasibility study and a resource update by mid-2014.
Chesser stayed active in drilling in spite of the prime ministerial circular thanks to an aggressive application strat-egy before the decree went into effect. “In 2010 and 2011, we got massive amounts of drill site permits. This was to ensure we did not face any legal chal-lenges if anything was to happen with the forestry law. Financially, forestry permits cost a lot. Sometimes you have to pay for permits you would never use, but this is the nature of the business and the cost that you have to pay. Chesser resolved to pay it and today we have existing per-mits.” said Cem Yüceer, general manager of Batı Anadolu Madencilik, the Turkish subsidiary of Chesser Resources.
Chesser is part of a select group of international-standard explorers tapping into Turkey’s sweet spot for mid-sized projects ideal for juniors with midcap am-bitions. “In Turkey, small entrepreneurial national or international companies are the catalysts of the exploration industry since they make quick-low cost discover-ies which then are developed by larger investors,” said Sabri Karahan, general manager of DAMA Engineering, a bou-tique engineering firm with expertise in exploration and development.
While the geological environment re-mains favorable, explorers will have to battle typical challenges that come with
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developing mining destinations. “Explora-tion companies are dealing with the chal-lenges of raised property acquisition costs during the early phase of exploration, red-tape and unrealistic time frames for get-ting into operation mode; these work as discriminatory barriers for them. Follow-ing the elections in March and in August 2014, it is expected that the government will revert to industry friendly attitudes and encourage exploration and mine de-velopment,” said Karahan.
In spite of these challenges, near-term development projects are advancing in the country, such as Toronto-based Al-dridge Minerals’ polymetallic Yenipazar project has, in addition to its gold re-serves, copper, silver, lead and zinc po-tential. After receiving EIA approval in late February 2014, Alridge is aiming to complete post-feasibility studies.
“We are completing an additional en-gineering study to review all equipment and mine design costs to reduce capex. According to the feasibility study, we had a $382 million capex, and after the ad-ditional study there will be a substantial amount of reduction on capex with no impact on the opex and throughput es-timated in the definitive feasibility,” said Serdar Akca, vice president and country manager for Aldridge Minerals.
Opting for a joint venture model, UK-based Ariana Resources, through its Turk-ish subsidiary Galata Madencilik, has partnered with the Turkish construction firm Proccea Construction to develop its Kiziltepe gold-silver project. The joint ven-ture, under the name of Zenit Madencilik, brings together Proccea’s experience in building gold mines, and Ariana’s explora-tion expertise in the Balikesir region.
“We are advancing steadily and moving towards gold production of approximately 21,000 oz/y in the next five years,” said Erhan Şener, general manager of Ariana
Mehmet Yilmaz, director, Tüprag.
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Resources in Turkey. “After evaluation of the EIA report, we will begin applying for the necessary permits to set up a plant. Ideally, we are looking to receive these per-mits in three months, and finish the con-struction process in 10 months.”
Among international players looking to round out their portfolios in the region are Vancouver-based Pilot Gold, which is advancing its TV Tower gold project in the Biga district, and Toronto-based Centerra Gold, which has operating mines in the Kyrgyz Republic and Mongolia. Centerra is advancing its Oksut gold project in Tur-key, releasing a PEA in February 2014.
“In 2013, we continued drilling on the Oksut property, and upgraded the initial resource estimate and converted most of the inferred resources to indicated resourc-es category. We now have 1.1 million oz indicated resources on the property at 1.2 g/mt. The preliminary economic assess-ment indicates a potential for two small open pit heap leach operations with an 11 year mine life. We are now proceeding to a full feasibility study on the property and we will continue to do drilling this year,” said John Pearson, vice president of inves-tor relations for Centerra Gold.
With a plan to spend $10 million in 2014 at Oksut, including $6.4 million for technical studies, environmental and social impact assessments and another $3.5 mil-
ready to spend $450 million,” said Hasan Ünsaç, counter manager for Alamos Gold.
Further down the value chainAdding to Turkey’s promising gold potential, downstream added-value improvements are opening up the country’s future as a gold trading hub. The refinery business in Turkey only began to develop over the past 15 years when the Istanbul Gold Refinery (IGR) was established. IGR has enlarged rapidly and has received accreditation by the London Bullion Market Association, along with two other Turkish refineries; Ata-say Kuyumculuk and Nadir Metal Refinery.
Among Turkey’s advantages as a gold refining hub are favorable labor costs compared to the European markets. “Tur-key’s location is also very strategic when it comes to refining and global trade. Dubai has gained its central position be-cause of their very open market, but this could change in favor of Turkey. Turkey plays a very important role because a lot of trade is going through the country and we have good relations with surround-ing countries,” said Ayşen Esen, general manager of IGR.
Given the high level of price fluctuations in global market, high domestic demand for gold and a growing appetite for gold imports, Turkey has good potential. Once markets stabilize, this is set to take off at a larger scale.
“Because of market fluctuations and the changes in gold price, imports were very high in 2013 compared to the previ-ous year-nearly two to three times more than past years’ values. Exports were very low compared to the values of previous years in Turkey,” said Aysen. “While the price differences have not been big, the fluctuations are. That is why the market is waiting—buying and selling continues on a small scale, but big purchases and sales are not happening.”
lion on further exploration, Centerra is aim-ing to commence production in late 2016. “The PEA indicates that the property can produce about 125,000 oz/y between its fourth and sixth years,” said Pearson.
Another near-term developer, Alamos Gold, is advancing its Kirazli and Agi Dagi deposits in Çanakkale after entering into the market in 2010. “We have the EIA report already approved, but an injunc-tion decision by the administrative court is stopping the execution of the EIA re-port. Now we are at the stage where we are waiting and looking to update the EIA report with a cumulative impact assess-ment. We have answered the invitation for foreign investment in Turkey and we are
Tolga Balta, managing partner, Encon Environmental Consultancy Co.
Ecevit İskender, company manager, Pozitif Drilling.
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Towards a gold standard: Gold miners improve HSE practicesEnvironmental concerns over cyanide usage led to turbulent be-ginnings for the gold sector, yet gold miners have emerged as leaders in elevating the wider mining industry’s HSE practices.
Encon Environmental Consultancy, a local firm working pri-marily on gold, silver and nickel projects, took its experts outside of Turkey to develop the necessary expertise in precious metal processing. “We know these enrichment processes very well. Before beginning consulting in this field, we spent two months in the United States with our team visiting 50 mines from Den-ver to Reno to understand the magnitude of what we are dealing with,” said Tolga Balta, managing partner of Encon.
Tüprag, which introduced heap leach gold processing to Tur-key in order to exploit low grade gold mineralization, has priori-tized its environmental work to ensure that their operations have no harmful impacts.
“After our start-up, our activities have been monitored by two different governmental officers because our work is in two dif-ferent provinces. In terms of water and air quality, noise and vi-bration and other environmental factors, we have always been far below the threshold, which is important to us,” said Mehmet Yılmaz, director at Tüprag. “We are proud of opening mines and operating within international standards while keeping friendly re-lations with the local people. These goals put a lot of value on our operations, because social license is very important in terms of making a successful, peaceful and technically sound operation.”
As the public becomes savvier with regards to gold mining, obtaining the social license to operate is an increasingly crucial step for project development. Careful attention on the part of not just miners but their service providers has made a marked difference in the feasibility of projects.
In this respect, Pozitif Drilling was founded in 2007 as a drill-ing services provider with a focus on HSE and community rela-tions. “Training is a big issue in Turkey. We understand how local communities react to mining companies and drilling activities and we make sure to extend training to people in the surrounding areas,” said Ecevit İskender, company manager of Pozitif Drilling.
“Before we go to the site, we collect data, make investigations into the area’s socio-economic level and discover if there is any sensitivity in the region to mining. When we arrive on the site, one of the first things we do is to train people about health and safety issues and the environment. We give them good information to mitigate the adverse impacts of the jobs we are doing there. We also put emphasis on giving jobs to the local people,” said Iskender.
Often in environmentally sensitive areas and traditionally agricultural zones, gold miners have put a premium on incor-porating local communities into their activities. “Koza Gold has executed an accurately planned community relations program at all of our operations. We recruit over 80% of our personnel from the local community and we prefer to work with local suppliers as much as possible, depending on their capacity,” said İsmet Sivrioglu, general manager of the company.
Tüprag echoes this sentiment with its local outreach work, bringing in an average of 75% of its workforce from the areas surrounding its operations.
“In Kışladag, the local content number is closer to 80% because the project is older and we have spent more time on training, in order to generate more human resources locally. In Efemçukuru, the number is around 60%, because it is a met-ropolitan city and workers are coming from everywhere. Our preference is always to hire locally, which helps the project. If
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you have employees from nearby, the local people feel it is their project,” said Yılmaz of Tüprag.
Refining the EIA process for the greater goodAs industry players have established environmental track re-cords and expanded their corporate social responsibility activi-ties, the sector’s most pressing challenges from an environmen-tal perspective have shifted to its regulatory framework.
Turkish EIA requirements have not yet been streamlined to international standards, creating the need for companies seeking bankable feasibility to conduct separate studies for domestic per-mitting and global financing. Among their divergences, the Turk-ish EIA does not take into account the social aspect of projects.
“On paper there are some differences between the two, like public participation and stakeholder engagement. For projects where international lending is needed, we make a gap analysis between Turkish and international lending needs and look at what extra work needs to be added into our roadmap for the execution of the project,” said Balta of Encon. “There needs to be about 15 to 18 months for the preparation of a baseline study, completing the EIA report and receiving a permit. In total the process should take a minimum of two and a half to three years to receive your license for operation.”
Turkish regulation has introduced a cumulative impact as-sessment (CIA) requirement that will improve industry respon-sibility, yet is also complicating the EIA study process. Projects without CIAs have seen their EIAs go into litigation, as in the case of Alamos Gold, prompting the industry’s consultants to adjust their study plans.
“Even though CIAs have been widely used for international proj-ects, this is a new subject for the Turkish EIA process and it shows that local EIA standards are moving closer to international ones, said Meryem Tekol, managing director of Golder Associates Turkey.
“Cumulative impacts are defined as incremental effects caused by past, existing and reasonably predictable activities in the future besides the project. A sound baseline database and knowing the impacts of existing and future projects is crucial for CIA studies,” said Tekol.
The mention of a CIA requirement came out in October 2013 in the one of the appendices of the EIA regulation. In the ab-sence of explicit guidelines, companies are challenged to access the necessary information to conduct these studies. “You have to consider what other developments are happening in the proj-ect area currently or that you can foresee and then assess the cumulative impacts. As a private company, you cannot go and start asking these questions to other companies. The govern-ment should have a database or sectoral/regional CIAs where companies can find this information but this has not developed yet,” said Bora Arpacıoglu, general manager and principal envi-ronmental engineer at SRK Consulting Turkey.
“Considering the current uncertainty regarding the regulators’ requirements for CIAs, we will continue using international stan-dards and our project experience until a guideline is published by the regulators,” said Serhat Demirel, senior geological engi-neer and office manager at Golder Associates Turkey.
Further preempting gaps on the international level, SRK Con-sulting in Turkey has started to adjust the preparation of EIA studies to also meet international standards in all aspects where Turkish regulations are not sufficient, such as with regards to archaeologi-cal finds and biodiversity. “We are working with clients to convince them to go beyond the minimum requirements and follow interna-tional industry best practices,” said Arpacıoglu of SRK.
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In contrast to gold, which has been a private sector endeavor, base metal production in Turkey has a legacy from the decades of state-owned operation. As privatization continues, with a Gen-eral Director of Mining Affairs (MIGEM) tender held most recently in April 2014, private companies are moving into the base met-als space to fill the gap of a growing base metals deficit.
“The key driver in Turkey is the balance of payments defi-cit. The economy has been growing at one of the fastest rates in the world for the last 10 years, which has caused a huge demand for raw material and metals like lead, copper and chrome. We are looking at a negative balance of pay-ments of $140 billion by 2023 if we do not do not develop our resources and produce metals at a faster rate,” said Alan Clegg, chairman of Afrasia Consulting.
“There is a lot of mineral potential within the country, but all is exported as raw material. Today, in Turkey we are using about 1.2 million mt/y of aluminum, but our domestic production is 120,000 mt/y. It is the same situation with copper. Turkey has many copper deposits and a copper use of about 470,000 mt/y, while production is only 50,000 mt/y. We are also importing about 340,000 mt/y of lead-zinc every year,” said Önal of TMDF.
Boosting production in Turkish base metalsCopper has a longer history than most metals in Turkey thanks to ETI Bakır, a former government producer complete with a smelter that is now owned and operated by Cengiz Holding, one of the largest mining investors in the country. With an an-nual copper concentrate production of 250,000 mt/y, ETI Ba-kir plans to increase copper production through international-standard exploration projects surrounding their operations, in addition to a plan to double smelter capacity by 2016.
Bringing Canadian expertise to the industry in copper pro-duction, the Çayeli Bakır mine in northeastern Turkey became part of First Quantum Minerals when the growing metals pro-ducer acquired Inmet Mining Corp.’s assets in 2013. The last three years have set production records at Çayeli Bakır with a major continuous production improvement yielding an increase of 8% last year. Production is slated to increase further yet for 2014, with 28,000 mt/y of copper and 35,000 mt/y of zinc.
With a current mine life until 2019, Çayeli Bakır is focus-ing on extending its operations. “Our current program tack-les extending the resource and reserve on three fronts. One is exploration of new areas; we have recently carried out a major soil sampling program on our mining concessions. The second part is the extension of the existing ore body; and we have identified opportunities to drill areas where we previously had limited data. Thirdly, we are working on the existing ore body and identifying lower grade areas that are economic and we can bring into the reserve,” said Iain Anderson, managing director of Çayeli Bakır.
Base MetalsTapping potential to meet demand
Çayeli copper mine. Photo courtesy of Çayeli Bakır.
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Capacity expansion and new invest-ments on the part of Turkish holding companies is also helping to boost pro-duction. Leading mining conglomerate Ciner Group, which, among its min-ing assets, has copper operations, has achieved a run of mine output increase to 1.6 million mt/y in the last two years at its copper mine.
Eczacıbaşı Esan, the mining subsidiary of Turkish holding company Eczacıbaşı, has parlayed its three decades-long lead-ership in industrial mineral supply to en-ter into the base metals space. “In 2009, with the opening of Balya Balıkesir zinc and lead plant, metallic minerals produc-tion became a substantial part of Esan’s operations. As of January 2014, the plant has reached 30,000 m total gallery length and 700 m depth which makes it the deepest lead and zinc mine in Tur-key. The Balya lead and zinc plant has a yearly capacity of 1.1 million mt/y of un-derground production and 120,000 mt/y of concentrated production,” said Serpil Demirel, assistant general manager of Eczacıbaşı Esan.
Özdogu Construction and Trade Co, on the other hand, began its involvement with the mining sector through contracting and has since moved into two main opera-tions: a ferrochromium operation and cop-per project. Located in Antalya under the
name ETI Electrometallurgy Inc, Özdogu mines chrome ore and operates the first low carbon ferrochromium plant in Turkey.
“The operation was acquired from the government in 2000 during the privatiza-tion process. We increased its capacity and made renovations with new technology and last year we exported 22,000 mt low car-bon ferrochromium and calcium carbide. Our company has partnered 50/50 with Aksu Mining in this endeavor. ETI Electro-metallurgy has 12 chrome mines with an annual production capacity of 100,000 mt/y,” said Murat Kavak, vice president of the board of directors at Özdogu.
Özdogu’s second mining operation, North Aegean Copper Enterprises, produces
copper and molybdenum. “After purchas-ing the operations in 2007, we opened our plant last year. We have approximate-ly 55,000 mt/y copper concentrate and 2,500 mt/y molybdenum concentrate pro-duction at grades of 25% to 30% copper and 55% to 57% molybdenum. Last year, we were the number one exporter of copper and molybdenum in the Aegean Exporters’ Association,” said Kavak.
Exploring to quench base metal thirstWhile deterred by drilling permit delays, base metals exploration has contin-ued with a focus on new technologies. Pasinex Resources, a public mining com-pany listed on the Canadian Securities Exchange and focused on base metals in Turkey, is advancing two flagship proj-ects, the 100%-owned Golcuk copper project in Sivas province, and the Hor-zum zinc project in Adana, which is being developed in a joint venture with Turkish mining company Akmetal.
“At the moment, Pasinex’s aim is to expand its prospective surface area map-ping using the ground penetrating radar. Applying this modern exploration tech-nology allows us to look at potential rock structures that contain zinc. With regards to our zinc project, the two main proper-ties Pinargozu and Akkaya are where we are focusing most of our attention. We have already carried out a number of geo-chem studies and geological mappings in the area and we are seeing excellent po-tential. This has brought us closer to the drilling stage. In the meantime, through ground penetrating radar (GPR) we are looking at zinc compositions that are concentrated in limestone hosted caves,” said Steve Williams, CEO of Pasinex.
After a long waiting period, explorers are ready for an upswing of activity now that drill permit applications have been
Multi pouring of 84 geochem sample set fusion for gold determination by fire assay. Photo courtesy of SGS.
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released as of March 2014. “The Prime Minister’s office decree affected the whole industry, and left many mining companies frustrated. On our end, we chose to work on geochem, geophysics and geological mapping to help us understand our proj-ects and become better prepared for the drilling stage,” said Williams of Pasinex
Going the distance: Turkey’s role in the global base metal marketTurkish base metals producers are look-ing at home and abroad to meet global demand for base metals. Close to many growing markets, Turkish producers have a transportation cost advantage reaching key markets such as Russia, China and North Africa.
European demand is also improv-ing base metal fundamentals in Turkey, which has less restraining policies than its European counterparts in need of critical raw materials. Chrome, in partic-ular, has a quality and cost advantage in Turkey. “The demand for Turkish chrome is high, as it is one of the main produc-ers besides South Africa. The quality of Turkish chrome is also much higher than other countries in the region, like Alba-nia,” said Soner Koldaş, CEO of chrome miner Turchrome. “We are waiting for the price of ferrochrome to improve and
we are optimistic about the future of the market due to Turkey’s stability”.
While Turkish producers are proving themselves competitive in the global market, export rates are waning in rela-tive value due to the increasing attrac-tiveness of their own backyard.
“We have exported our products in the past, but for now we are mostly focused on the Turkish market. We see a local shortage of copper cathode supply and we have seen some international com-panies limiting their supply to Turkey. It makes sense for us to stay in the market, where there are no freight issues and the premiums are good,” said Zeynep Cengiz, director of sales at Cengiz Holding.
Recognizing the need for geographic diversification, however, base metal pro-ducers such as Turkish conglomerate Yıldırım Holding are looking for invest-ments abroad. Yıldırım, one of the coun-try’s top chrome producers, moved into mining in 2003 with the acquisition of Eti Krom from the government. After making its first international acquisition in 2008 with the addition of Swedish company Vargön Alloy, Yıldırım became the second largest high-quality carbon ferrochrome producer in the world and the largest ex-porter of chromite in Turkey.
Undeterred by declining chrome prices, Yıldırım further expanded internation-ally with the 2013 purchase from Russian company Mechel of the highest grade chro-mite ore body in Kazakhstan, the Voskhod chrome reserves and mining plant and the Tikhvin Ferroalloy Plant in Russia.
“It is a very good deposit that allows easy production at a relatively low price. After this acquisition, our reserves and production levels have increased dra-matically,” said Alp Malazgirt, CEO of Metals and Mining at Yıldırım. “In the near future, we are interested in becom-ing a technology-driven company in fer-rochrome. Diversification through our local and international assets allows us to be flexible and to withstand global commodity price fluctuations.”
Alp Malazgirt, CEO, metals and mining at Yıldırım Group.
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Solving the mineral processing challengeTurkey’s wealth of polymetallic deposits requires careful atten-tion to processing strategies, which can make or break a project. As the low hanging fruit of Turkey’s geology is mined out, de-velopers are prioritizing processing research and working more closely with industry partners who provide them with in-country expertise to solve processing challenges.
“In Turkey, easy mining methods are no longer valid. Ex-tracting ore is getting more complicated and companies have to complete more drilling and do more scientific work. For this reason, a lot of samples should be taken and mineral process-ing methods, flow sheets and pilot tests should be carried out to give an initial idea about costs and grades. With the example of copper, minerals like sulfur contaminate the ore and it must be pulverized on a very small scale, which increases the cost,” said Emin Ulu, company manager at Argetest, a private mineral processing laboratory founded in Turkey in 2012.
As the capacity for mineral analysis expands in Turkey, project developers have more in-country partners from which to choose. International player Acme Labs established operations in Ankara in 2006 to cover the Eurasian region. Originally housing only a sample preparation laboratory, from which samples were sent to Vancouver for analysis, Acme Labs has increased its local capac-ity due to growing demand in the industry for analysis to be done on the spot. “In Turkey we have the largest fire assay capacity, which is a crucial method to obtain gold and silver valuations. We are working on base metal packages in-country and we will begin providing ICP-OES results to our clients in Q2 of 2014,” said Nezih Dogu, country manager for Acme Laboratories.
“In the past two years, Turkey’s laboratory industry has moved from prep labs to analysis itself. Previously, only local Turkish laboratories carried out analytical work, but the quality
was much lower than what it is today. With the advancement of foreign investment and know-how, the quality of lab work has improved significantly,” said Dogu.
The next hurdle for Turkish laboratories is to acquire 17025 accreditation in order to better service clients looking to access global stock exchanges. “Acme Analytical Laboratories Turkey branch is working on accreditation. Hopefully we will be receiv-ing 17025 accreditation on fire assay and base metal packages within the year,” said Dogu.
SGS, which opened up a geochemistry laboratory in Ankara in 2012 to meet the high demand for laboratory services, is also hoping to receive 17025 accreditation within the year to serve not just Turkey but also surrounding countries. “Turkey is well positioned to serve the region, including both the Middle East and Eastern Europe. Now the lab in Turkey receives samples from Former Yugoslavia, Georgia and Armenia. SGS Turkey has also done exploration work with clients from as far as Senegal,” said Evgueni Terentiev, laboratory manager for SGS Minerals & Metallurgical Services in Turkey.
Dealing with Turkey’s complex geology, laboratories are pre-pared to offer complex analysis packages to customers. “In most cases, gold is complimentary to base metals or in equal part. Mostly, our clients ask for complex packages that work with PGM, gold and base metals,” said Terentiev.
“Previously, companies were extracting their ore, crush-ing it and selling it. Now we have lower ores and need more beneficiation, so we need more experiments, more reactives and more test laboratories,” echoed Abdullah Buhur, company manager at Argetest.
With 17025 accreditation on the horizon for Turkey’s mineral laboratories, the country is poised to play a more crucial role within the region’s mining market.
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In a more favorable position than Tur-key’s metal miners, who are dealing with declining prices and permitting delays, Turkish coal producers have been boost-ed by Turkey’s growing need for power and an advantageous government in-centive scheme aimed at increasing the country’s power generation capacity.
Energy demand in Turkey doubled over the last 20 years and is expected to double yet again within only the next decade to feed a growing economy and a young pop-ulation. With the vast majority of Turkey’s hard coal supply coming from abroad, the government has identified indigenous coal reserves as a crucial step towards energy independence. As part of Vision 2023, coal-fired power is set to meet up to 10% of the country’s energy needs.
Coal consumption in Turkey has doubled since 1990 and continues to grow faster than local production. In 2011, 104 million mt/y of coal was consumed domestically, while local production came in at 76 million mt/y. Over the last decade, coal production in Turkey increased by nearly 10 mil-lion mt/y but has leveled off in recent years and only reached 65.4 million mt/y in 2012. Making up the differ-ence, imports are coming primarily from Russia and Colombia.
Given these dynamics, it was forecast that coal imports would grow by 25% in 2012-2013; however in reality imports fell by 12% in that period coming in at 20.9 million mt/y as the Turkish Lira has depreciated and domestic coal has be-come increasingly attractive.
Developing Turkey’s hard coal and lignite reservesIn spite of quality and extraction chal-lenges, the 10 million mt/y boost in coal production in the past decade is attribut-able to the ongoing privatization of the sector. The sector remains largely in the hands of state-owned enterprises, ac-counting for 90% of operations, however 35% of this state production is carried out by private subcontractors. As opera-tions transition to the private sector, im-provements in exploration and produc-tion will continue.
Since 2005, coal exploration in Tur-key has reached 200,000 m drilled over
CoalFeeding Turkey’s Appetite for Energy
30,000 km². Recent drilling programs carried out by Soma in the Black Sea dis-trict of Merzifon at the Yeni Çeltek mine, which has been producing for over 25 years, have brought in roughly 25 mil-lion mt of new high quality coal reserves. In line with government incentives, after ramp up a coal-fired power plant of 300 MW will be erected on the site.
For its part, Ciner Group, which has also invested in both coal mining and power generation, operates a state-owned 620 MW plant in Çayırhan by concession agreement which they fuel with coal mined underground. Ciner is also commissioning a three unit power plant in Silopi, 7 km away from the Iraqi border, which by end of 2014 should produce over 400 MW. Ciner is mining 1.2 million mt/y of asphaltite for the Silopi complex, which provides 4,000 kcal/kg when burned.
While the sector is boosted by both government support and growing de-mand, it has been held back by chal-lenging geology and low heat content.
Turkish coal reserves are primarily lig-nite, only 6% of which has a calorie value over 3,000 kcal/kg.
Compared to its 11.7 billion mt of lignite resources, the country has roughly 1.3 billion mt of hard coal, concentrated in the Zonguldak area on the Black Sea coast and ranging in heat content from 6,200-7,200 kcal/kg.
To confront the challenge of low calor-ic value coal reserves, many companies are putting investments into R&D such as Düzgün Mining Co., which produces 1.5 million mt/y of brown coal in Konya Prov-ince. “We are running a project with the Scientific Technology Research Council of Turkey (Tübitak) to build a plant to dehy-drate coal, which makes it better quality,” said Şenol Seyhan, general manager of Düzgün Mining Co.
“There are other coal drying facilities in Turkey, but they are using different technologies. In most coal mines, the coal drying machines are rotors, which is very old technology. Our plant will im-prove upon this system using a rolling
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mill made from ceramic. This new technology will increase cal-orie count from 2,000 kcal/kg to 3,000 kcal/kg,” said Seyhan.
As coal projects go ahead, the service sector is honing its coal expertise to find new projects in a tough climate. “Coal is a large focus for DMT/IMC given its strategic importance to the country. Turkey will need 15,000 MW of electricity in the com-ing years, and the country needs more coal mine development to build coal power plants,” said Yücel Picakci, Turkey country manager of DMT/IMC.
DMT, an engineering and consulting firm based in Essen, Germany, is bringing its exploration and production planning to the mining sector in Turkey through its IMC consulting subsid-iary. “Germany is number one in the world for coal mining in terms of technique and mine planning. For our geological sur-veys, we bring in our experts from Germany who are internation-ally accredited,” said Picakci.
Government incentives target coal-fueled powerTo help the sector along, the government has introduced a scheme of incentives to encourage coal production and subsequent coal-fired power plant developments. A revision in spring 2013 to the scheme included the addition of coal with high calorific value.
Within the scheme of incentives that can be applied to coal-fired power plants based on indigenous coal, a power plant of 1,000 MW or more that enters into commercial operation by the end of 2014 will have a purchase guarantee from Turkey’s Electricity Generation Co (EUAS). Further incentives include the coverage of expropriation costs and the building of transmission lines. Exemp-tions from license fees also apply to electricity market legislation.
Coal incentives are attractive, though there remains room for improvement, particularly with regard to license areas that are limiting development opportunities for the private sector.
Brown coal mining guarry at Ilgın county, Konya province Photo courtesy of Düzgün Mining Co. Yucel Picakci, country manager, DMT/IMC.
Belt cleaners. Photo courtesy of Martin Engineering.
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Attracted by the region’s potential, more global service providers are setting up in Turkey to serve Eurasian mining, and more local companies are reaching international markets. Building on Tur-key’s existing industrial strength, particularly in construction, Tur-key’s mining supplier base has a degree of sophistication unique to most developing mining markets. “The Turkish construction industry not only is very mature but also ranked second to China in the international market. Therefore, the construction industry is not only capable within the borders of Turkey but also an industry that has been very successful outside of the country. The major risk of capital execution in Turkey is somewhat marginalized and accordingly is one of the main advantages of Turkey in mine devel-opment,” said Han İlhan, president and CEO of Aldridge Minerals.
Drilling: Meeting international standards as exploration goes deeperPermitting delays and the global downturn have taken their toll on the drilling market, causing many rigs to sit idle in 2013. “Now, there are about 700 rigs available in Turkey. However, only 40% are being utilized. This is on par with the worldwide average of 35-40%,” said Bülent Şahhüseyinoglu, CEO of Ma-pek, exclusive Turkish agent for Boart Longyear rigs.
With the industry expected to pick up in the latter half of 2014 and 2015, suppliers such as Mapek are preparing new product offers to meet the advancing technological require-ments of exploration.
“We have new technology and innovation, such as sonic drilling from Boart Longyear. When the market accelerates again for exploration drilling, there will be a demand for these more high-tech rigs,” said Şahhüseyinoglu.
Spektra Jeotek, a Turkey-based global drilling services and manufacturing company, began operating on its fourth conti-nent, North America, with the acquisition of Forages Mercier in 2012. “All over the world we have 98 drill rigs. Not all of them are in operation in this difficult time but it creates a lot of opportunities to prepare for the coming cycle,” said Levent Okay, president and CEO of Spektra.
“We made a lot of investments, such as in our new manufac-turing building of more than 22,000 m² just to get ready for our aggressive growth plans in the next cycle. Within this year and next year, we are looking forward to acquiring new companies, especial-ly in South America, which is our next target market,” said Okay.
Working in Turkey, which offers a strong but small market,
international players can bring much needed drilling expertise to an underexplored jurisdiction. “We have good experience work-ing with Turkey’s complex geology which can easily translate to other countries and put us in front of our competitors. For example, we did not have experience in directional drilling in our region because this is not common in Turkey. Spektra has succeeded in acquiring this experience through our acquisition of Forage Mercier. We are drilling a lot of directional holes in Canada which we can now bring to our operations in other re-gions,” said Okay.
To introduce more cost efficiencies into the drilling process, service providers in Turkey are moving into manufacturing. “In 2007, when we established Pozitif Drilling, we had our rigs man-ufactured by another company; however we found that we were
Developing a Strong Supplier BaseLocal and international firms bring means of cost-cutting and innovation to Turkey’s miners.
Diamond core drill site at North-West of Turkey. Photo courtesy of Pozitif Sondaj.
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not able to get the level of service that we wanted, so we established our sister company. This allows us to modify rigs to give better service to clients. We can now design and commission custom-built mul-tipurpose rigs with different capabilities based on clients’ specific requirements,” said İskender of Pozitif.
While the diamond drilling market is well covered in Turkey, opportunities re-main in reverse circulation (RC) drilling. Global Magnet Group, an Australian-based company, established a presence in Turkey to provide RC drilling services and has plans to expand in the market to bring in unmanned aircraft geophys-ics and exploration project development.
“We completed a 10,000 m drilling contract for an Australia-based company with projects in Turkey in 2013. Going forward, we just signed a first drilling contract with Alacer Gold and another with a locally-based Turkish company this year. We are hoping it will flow on from there and we will be drilling be-tween 10,000-30,000 m this year,” said Leo Pilapil, business development man-ager for Global Magnet Group.
“Mining-wise, Turkey is relatively un-explored and does not have advanced or sophisticated exploration techniques. The deposits that are easy to discover have been already found; in areas where there is relatively flat ground with easy ac-cess, outcrops, old workings and where it is easily sampled. Where there are no outcrops, it can be difficult to know what methods to employ. Having spent the ma-jority of our time in Australia where there are no outcrops and the rocks are much older, we have developed more appropri-ate techniques such as airborne geophys-ics and low-level geochemistry to look at areas without any outcrops,” said Pilapil.
Drillers have also relied on other mar-kets to stay alive in the mining down-turn, expanding to geothermal and oil
Levent Okay, president and CEO, Spektra.
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and gas drilling and also targeting min-ing projects outside of Turkey. Thanks to diverse project experience, Turkish drill-ers are finding themselves in demand in the global market, such as in the case of Ortadogu Drilling. “In Pakistan, Ortadogu has been chosen as a partner in a joint venture with Fugro to work on a Pakistani government iron mine. As the slim hole exploration technique is be-coming more known over the last years, there is also demand coming from Euro-pean countries. Now, we are preparing ourselves for a project in Italy for a very well-known energy company about slim hole drilling for exploration of geother-mal reservoirs,” said Ahmet Topdemir, general manager of Ortadogu.
Ortadogu, which manufactures its own rigs through its sister company Geo Machinery, is honing its machinery en-gineering department with the help of Tübitak to find cheaper and more inno-vation solutions.
“We are working with Tübitak on three projects directly related with machine design and building. We are looking for different sources aside from gasoline be-cause gasoline prices are very high and directly affect our costs in drilling. To present our customers with good prices we need to decrease our operating cost. We are designing an electricity motor ma-
chine which is a new project for subsur-face work for the Çayeli Copper Mine of First Quantum Minerals,,” said Topdemir.
Turkish contractors bring expertise to mining capital executionAs the Turkish mining industry contin-ues to grow, local engineering expertise is evolving to meet increasingly sophis-ticated needs. Promer Consultancy En-gineering, which specializes in detail engineering, has developed its practice through working in industrial design for Turkey’s gold producers, such as Koza, Eldorado and Alacer.
“Turkey’s engineering industry does
not have strong international experi-ence in basic design ability, so for the past two years we have developed rela-tionships with firms in the international market to support us with basic design. We now have a relationship with Jacobs Engineering, a company with extensive global experience across a range of mar-kets. Jacobs is supplying processing en-gineering and we are supplying all de-tail engineering, as well as local market availabilities and local engineering sup-plies as we develop projects in Turkey,” said Yüksel Tonguç, general manager of Promer Consultancy Engineering.
While international companies often opt to import their support services, the cost savings that come from using Turk-ish expertise are unparalleled.
“International investors do not know enough about local market availabilities. Most think that Turkey does not have much industry and they prefer to make their investments using technical sup-port from North America and Europe. With this, they are losing at the begin-ning because they are calculating in high price investment values. Generally con-struction and erection is only 40-45% of your investment, while another 50% is equipment. You should know the market very well to know which critical equip-ment should be imported and what can
Han İlhan, president and CEO, Aldridge Minerals.
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be procured from the local market,” said Tonguç of Promer.
Bringing in international experts as partners is a model that has served well. Together with US-based Kappes Cassi-day & Associates (KCA), Turkish engi-neering firm DAMA Engineering is doing technological studies at KCA laboratories as well as EPCM work for gold projects. “In that regard, we have completed one project in full in Turkey, which is an agi-tated tank leach operation of high grade gold/silver with a 200 mt/d capacity run-ning for the last two years. We are about to complete another project near Konya, Turkey,” said Sabri Karahan, general manager of DAMA Engineering.
When it comes to the actual opera-tion of mines, Turkey’s strong construc-tion and engineering experience again comes to the rescue to introduce cost savings through the use of subcontrac-tors. Çiftay Construction, Commission-ing and Trade has served the mining market for over 50 years, starting with aggregate mining and moving into coal, iron ore and gold in recent years. Çiftay contributes annually to the production of almost 52% of the iron ore produced in Turkey through contracting for Er-demir. Among its other operations, Çiftay has handled 35 million mt of earth works for Alacer’s Çöpler mine to date, in addition to carrying out under-ground mining at Koza’s Mastra mine and now VTG Holding’s Çalda nickel mine producing 200,000 mt of nickel.
“Foreign investors want to make min-imum investments and so do not want to invest in equipment, which yields high-er costs,” said Gülant Candaş, general manager of Çiftay.
A contractor approach can cut costs in labor and fuel. “When considering the costs of fuel, which are high in Turkey, and the low cost of labor, it is an advan-
Gülant Candaş, general manager, Çiftay.
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tage to use a smaller equipment fleet. When you reduce the size of equipment the labor force increases automatically, which is why foreign investors want to work with contractors who can manage their increasing labor force. With smaller equipment, your initial investment costs are much lower. The other important benefit is that we are able to supply jobs for local people, which brings more ben-efits to the communities,” said Candaş.
Equipment supply: Seeking cost-control and innovation in the down-cycleAs more suppliers move in, and Turkish distributors acquire more global brands, cost and quality competition has grown fierce, making innovation and after-sales services key points of differentiation.
Martin Engineering Turkey, a US-based supplier of bulk material handling solutions, is relying on its innovative ap-proach to safety to maintain its edge. “In Turkey we are implementing an innova-tion that is called ‘Walking the Belt,’ a full technical evaluation process of the cus-tomer’s conveyor systems that we carry out through a routine inspection program for conveyor maintenance, providing regularly scheduled reviews of the com-ponents. While the systems run, you can-not fix them, but you can observe what is not working properly. Then, when there is a maintenance shut down, you know di-rectly what to do,” said İlker Tan, general manager of Martin Engineering Turkey.
“We will continue to perform this ser-vice at site by a tablet which is supported by a special software program. By using this technology, we will be performing the program more effectively, faster and safer,” said Tan.
Further along on the innovation front, information technology and software so-lutions are playing a more crucial role in Turkey as miners learn to take better ad-
vantage of information systems. Almina Minerals was established in late 2011 as a specialist consulting and engineering firm exclusively distributing for Geovia, formally Gemcom, to provide geology, mine planning and operational perfor-mance management. As of 2014, Almina is the also exclusive distributor in Turkey for LIM, which specializes in software for geological measuring instrumentation.
“LIM’s main mining business areas are in foundation, geo-technics, hydrogeology, mines and quarries, underground work-ings and related software. Our ambition is to be able to propose to our clients a complete measurement solution for bore-holes, comprising both instrumentation for acquisition during drilling and logging in the resulting borehole, as well as for foundations and special structures,” said Arar of Almina Minerals.
The persistent challenge for service providers when it comes to innovative technologies is in educating the market. For MineRP, a global software company and consultancy based out of South Af-rica, bringing its proprietary mine design and planning system Mine 2-4D for both underground and surface mining to Tur-key, on the job training for clients is a necessary service offer for companies bringing new products to the market.
“We have given the opportunity to our clients to send their mining engineers to Canada and South Africa to train on our international projects. These young engi-neers were able to take geostatistics and mine planning courses at our regional of-fices. We are keen to support our clients not only in completion of their engineer-ing projects, but also in professional edu-cation and coaching,” said Sermet İlhan, general manager of MineRP Eurasia.
As more innovation comes into the market, both from international mining experts and from locally-grown R&D, Tur-key is propelled further along the path to the premier league of mining countries. Turkey’s geological potential is undoubt-edly promising, yet the country’s future as a world-class mining jurisdiction will rely heavily on its government’s abilities to improve its practices of regulatory imple-mentation. With democratic elections un-derway and growing industry associations lobbying for miners’ interests, the industry has a bright outlook for policy improve-ments. As the global mining markets pick up in the latter half of 2014 and the start of 2015, more free flowing capital will find its way to the Turkish market provided its retains its investor-friendly stance.
İlker Tan, general manager, Martin Engineering Turkey.
MiNiNg iN TurkEy
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