By Steve Fiscor
(Updated March 26, 2020) Mines continue to assess operations while actively implementing programs to protect workers and the surrounding communities, and preserve liquidity. Those located in low-risk jurisdictions continue to operate. Others have reduced or temporarily suspended production to slow the spread and comply with regional edicts. Peru, South Africa and Quebec have ordered businesses to shut down for periods of two to three weeks. What follows is a compilation of announcements from various miners worldwide. Other COVID-19 updates are available on the E&MJ website.
On Friday, the world’s largest mining company BHP said it plans to hire 1,500 additional people to support its workforce operating across Australia. The jobs will be offered as six-month contracts and cover a wide range of skills, including machinery and production operators, truck and ancillary equipment drivers, excavator operators, diesel mechanics boilermakers, trades assistants, electricians, cleaners and warehousing roles across coal, iron ore and copper operations.
Following the initial six-month contract, BHP will look to offer permanent roles for some of these jobs. BHP will continue to assess this program and may increase the number of jobs available, it said.
BHP Acting Minerals Australia President Edgar Basto said supporting people, communities and partners, safely, is the highest priority. “As part of BHP’s social distancing measures, we are introducing more small teams with critical skills to work dynamically across different shifts,” he said. “The government has said that resources industry is vital in Australia’s response to the global pandemic.
“We are stepping up and providing jobs and contracts. Our suppliers, large and small, play a critical role in supporting our operations. It is a tough time for our communities and the economy. We must look out for each other as we manage through this together.”
BHP said it will defer services that are not considered urgent or a priority and it has changed the terms of payment for all providers and collaborators: large taxpayers, 30 days; SMEs, 14 days; and local companies from the Antofagasta and Tarapacá regions, seven days.
“We know that our activity has a multiplying factor in employment and the national economy,” Basto said. “Keeping our operations running is essential for the stability of the economy, especially in the face of the difficult times ahead. It is possible to manage the health crisis faced by the country, as a priority, and at the same time ensure operational continuity.”
The company said it will also establish a A$50 million Vital Resources Fund to help support regional Australian communities in its areas of operation, which are facing the significant challenge of the COVID-19 pandemic.
“BHP stands with the regional communities we operate in,” BHP CEO Mike Henry said. “With those communities facing significant challenges, we are stepping up in establishing the Vital Resources Fund, which will provide support in a range of areas such as health services and resilience building during this difficult time.”
Over the coming weeks and months, BHP will work with relevant leaders and groups to distribute funding according to local needs and in a manner aligned with government programs and initiatives.
The largest gold producer, Barrick Gold, said emergency response plans for dealing with the COVID-19 pandemic have been stepped up at all its sites and offices across the world.
President and CEO Mark Bristow said the company was closely monitoring the situation. All non-essential business travel has been suspended and non-essential projects have been curtailed. In line with directives from host governments and the international health authorities, Barrick said it has put measures in place to mitigate the risk of infection while ensuring a safe environment for operations to continue as usual.
“In addition to protecting our people, we have taken measures to support the sustainability of the business,” Bristow said. “We have increased stock levels for key supplies and equipment to a minimum of three months, identified alternative suppliers and shipping routes, and put in place contingency plans for clearing and offloading. To date, placed and forecast orders are still intact and there have been no hold-ups in our supply chain.”
To protect its workforce and nearby communities, Newmont is putting some operations temporarily into care and maintenance while others continue to operate at targeted production levels.
“We are also making sure that these short-term disruptions do not impact long-term business value while ensuring we are well-positioned to safely and efficiently ramp-up operations in a timely manner once the worst of this global pandemic passes,” President and CEO Tom Palmer said.
Mines representing approximately 80% of Newmont’s 2020 production outlook continue operating in line with production targets for the year and have implemented heightened levels of health screening, along with support services being conducted remotely.
In order to protect nearby communities and align with travel restrictions or health considerations in Argentina, Canada and Peru, four Newmont operations are being temporarily put into care and maintenance: Musselwhite, Eleonore, Cerro Negro and Yanacocha.
In the USA, Ohio was one of the first to initiate a state-wide shutdown of non-essential businesses. On March 19, Cleveland-Cliffs, following guidelines from the office of the Governor of Ohio, temporarily shut down construction activities at its hot-briquetted iron (HBI) project site in Toledo, Ohio. Ohio Gov. Mike DeWine then clarified the guidelines, which allowed construction activities to resume.
“I am pleased that this order recognizes the iron and steel industry as an essential business critical to the United States’ economy and national security,” Chairman, President and CEO Lourenco Goncalves said. “Our business is vital to our country’s economic stability, and the order ensures business continuity for Cleveland-Cliffs’ steel mills, our critical suppliers, and customers during this public health crisis.”
Cleveland-Cliffs has implemented a mandatory work from home policy for those employees who can work remotely. They have also implemented several procedures across their iron ore mines and steel operations, including specific guidelines for social distancing and increased frequency of cleaning. All Cleveland-Cliffs iron ore mining and steelmaking facilities will remain in operation
In addition to suspending its quarterly cash dividend, Freeport-McMoRan (FCX) also announced it has undertaken an aggressive review of operating plans at each of its global copper and molybdenum operations to target reductions in all elements of costs and capital spending to achieve maximum cash flow under current market conditions.
“The prudent steps we are taking to address costs and capital spending and preserve a strong liquidity position are necessary to maintain flexibility as we respond to current global economic uncertainties and the resulting sharp decline in copper prices in recent weeks,” FCX President and CEO Richard C. Adkerson said. “We are continuing to focus on the health and safety of our employees, supporting communities in our operating areas and serving customers who have indicated ongoing requirements for copper at this critical time.”
On March 18, Chile’s national copper company, Codelco, announced it would reduce the level of its activity for a period of 15 days from March 19, similar to the timeframe adopted nationally by Peru.
Antofagasta plc has decided to reduce the number of employees and contractors working at the Los Pelambres Expansion project and the company’s operations. The workforce of approximately 1,900 people working on the construction of the Los Pelambres Expansion project will be reduced by approximately 75% with parts of the project being put on care and maintenance, while other areas will continue according to their original schedule. The reduction in workforce will be for at least 15 days and reviewed periodically, with a consequential delay expected in the completion of the project.
At the operations, the workforce will be reduced by approximately 30% with critical employees remaining at work to ensure production continues unaffected, explained Antofagsta CEO Iván Arriagada. The reduction in people will allow greater social distancing at the operations’ accommodation, catering, transport and other facilities.
Lundin Gold has temporarily suspended operations at its Fruta del Norte gold mine in Ecuador amid growing concerns regarding the spread of COVID-19 in the country.
“The situation in Ecuador has changed rapidly over the last few days,” President and CEO Ron Hochstein said. “We are committed to the health and safety of our employees and the local communities in which we operate. In consultation with both local officials and the government of Ecuador, we have made the decision to temporarily suspend operations in order to reduce the risk to our workforce and to local communities.”
During the suspension, the company will maintain a workforce at Fruta del Norte to conduct care and maintenance activities and special projects in order to minimize the impacts of this temporary shutdown.
Kirkland Lake Gold said it introduced company-wide health and safety protocols and temporarily reduced operations until April 30 at the Detour Lake mine. The major gold mine in a remote area (300 km northeast of Timmins, Ontario) with a large accommodation camp, suspended all non-essential work at all operations and suspended all exploration activities. The company also announced it will terminate the Automatic Share Purchase Plan to maintain financial strength during the current period of uncertainty.
“While none of our employees have tested positive for COVID-19, the actions we are taking represent our best judgment, based on what we know today, on how to responsibly protect our people from the pandemic,” President and CEO Tony Makuch said. “As always, the safety of our employees is our top priority. We will continue to produce, though at lower levels, and will ensure critical tasks are completed, such as managing water during the spring run-off and ongoing environmental management. It is not possible at this time to estimate the impact of reduced operations on Detour Lake’s 2020 production.”
New Gold reported that its Rainy River mine, which is located in western Ontario close to the US-Canadian border, has temporarily suspended operations for a period of two weeks so that its local workforce can follow the 14-day period of self-isolation as recommended by federal and provincial authorities relating to travel outside Canada as frequent border crossing is a common practice in the region. Approximately 70% of the Rainy River’s workforce is made up of local residents, many of whom commute from Minnesota. The New Afton mine in British Columbia continues to operate at normal levels with a minimal proportion of their workforce currently in self-isolation.
Hudbay Minerals has shutdown operations at the Constancia mine in Peru due to the national quarantine. A small workforce will be maintained to oversee critical aspects of the operation, with the overarching goal of facilitating a quick and efficient ramp up back to normal levels once the regional situation improves, the company said.
In Manitoba, Hudbay’s mines continue to operate and ship concentrate and zinc metal. At this point, Manitoba remains a low-risk jurisdiction with no known cases of COVID-19 in northern Manitoba.
In Africa, B2Gold said it continues to operate its mines in Mali (Fekola) and Namibia (Otjikoto), with a temporary suspension of mining but continued milling at its mine in the Philippines (Masbate). The problems at the Masbate mine stem from a temporary fuel shortage related to inbound cargo shipments to the island. The company said it is moving its ongoing expansion and development projects forward with certain restrictions and delays experienced by individual project. B2Gold expects to meet or exceed its budgeted consolidated gold production for the first quarter of 2020.
B2Gold said it has been monitoring the COVID-19 outbreak and the potential impact at its operations since mid-February and has implemented several measures and introduced additional precautionary steps to manage and respond to the risks.
