Connecting to the grid is any large mining project’s ultimate power-supply goal, but when that isn’t possible—either temporarily or permanently—diesel genset systems offer many flexible solutions
By Russell A. Carter, Managing Editor
Turn a famous political saying head-for-tail, and you end up with “power is money”—which just happens to be a fairly concise description of the relationship between a mining project’s chances for success and its ability to obtain a reliable supply of electricity.
Electrical power for crucial mine operations, regardless of whether it comes from a national grid, a captive generating plant or a bank of diesel generator sets, is rarely cheap. Yet, without a dependable power supply, mines have little chance of sustained profitable operation. Tweaking the power-to-profit equation is an important process in any significant greenfield or brownfield mine/plant development effort.
A recent study confirms that the mining industry has adopted two primary solutions for obtaining electricity for its projects, depending on the power situation in the region, project energy demand, and its distance from the grid1:
- When sourcing from the grid is too expensive or when there is no grid, industry finances and builds its own facilities or sources from a private power producer.
- When sourcing from the grid is less expensive than own generation, industry either sources from the grid or finances/co-finances an upgrade of the utility’s power assets.
On the project side of any major power arrangement decision, major considerations can include location, the type of mine (surface or underground), commodity being mined, configuration of the production fleet, and method of beneficiation, to name just a few—with the power needs and/or costs of off-grid site sites, underground operations, hardrock metal mining and processing, for example, usually eclipsing that of their surface-mine, soft-mineral, on-grid counterparts.
On the supply side, issues—again, just to name a few—can range from the vastly dissimilar rates and time frames in which mine project planning vs. government or power-utility planning occur, and the sometimes conflicting power requirements for mine vs. regional needs and resources; to competitive-advantage considerations and investor acceptance or reluctance to provide funding for generation facilities that would provide service beyond the specific needs of the project.
When these issues don’t get resolved in a timely manner, the results can be catastrophic to a project’s schedule and profitability. Throughout 2012, for example, the $6.6-billion Oyu Tolgoi copper and gold project in Mongolia was caught in a ‘power’ struggle of a different nature as Mongolian and Chinese authorities argued over a suitable agreement to provide electrical power to the project, which couldn’t be served adequately by the Mongolian grid and was counting on obtaining on a high-voltage link from China for its permanent power.
As the stalemate dragged on into the final months of 2012, project shareholder and manager Rio Tinto faced the prospect of either building its own power plant—a costly alternative that would have delayed the project’s scheduled 2013 production start—or standing pat and incurring an estimated daily loss of $8.4 million from delayed copper and gold production revenues. In the meantime, it scrambled to fill the fast-tracked project’s escalating power needs by arranging for additional diesel generator sets to supplement the interim power supply.
Finally, in early November the company confirmed that a power purchase agreement had been reached to supply the mine with electricity generated in China. Commissioning of the concentrator began soon thereafter, and Oyu Tolgoi remained on course to reach commercial production in the first half of 2013.
On the Grid, or Off?
Other project power arrangements generally aren’t nearly as complex or politically burdened, and most involve relatively straightforward engineering decisions—but are equally as important for success.
However, not all projects are able to connect to a pre-existing grid, and some may gain eventual grid access but experience connection delays and possible project slowdowns until the delivery infrastructure is built. Others may be located so far away from the grid that diesel-powered generation is the only option. And, there are instances where diesel-generation economics are simply good enough to make it the best choice.
For example, Wärtsilä, a major global supplier of diesel-driven power plants, recently signed a turnkey contract to engineer and build a major power plant at Nouakchott, Mauritania in West Africa. The contract is valued at €128 million ($166.8 million) and represents the most important dual fuel power project currently being undertaken in West Africa, according to Wärtsilä. The plant’s generating capacity was not disclosed.
The plant will be powered by eight Wärtsilä 50DF dual-fuel generating sets, which run on both natural gas or conventional liquid fuels (heavy fuel oil and light fuel oil). The intention is to operate the power plant on natural gas from the Banda offshore oilfield, some 80 km from the Mauritania coast. This supply is scheduled to be available in 2015.
The order was placed by the state utility, Société Mauritanienne d’Electricité (Somelec). When completed, power from the plant will be fed to the national grid and will also be used to provide energy for the country’s growing mining industry. The delivery of the equipment and completion of all construction work is estimated to be finalized within a 24-month time frame. Wärtsilä is also negotiating a long-term Operations and Maintenance (O&M) contract for the power plant, and to date has delivered several other power plants to Mauritania with a total generating capacity of more than 170 MW.
Wärtsilä believes the key to its success, and to increased future business, is being able to provide ‘smarter’ power generation choices by meeting customers’ demands for flexibility in power-generation capabilities that include load cycle variations (base, intermediate and peak) to fuel options (diesel, natural gas, heavy and light fuel oils and biofuels).
It also helps to offer solutions that can be quickly implemented, according to the company. In 2012, Wärtsilä won a contract to supply equipment for a natural-gas fueled capacity expansion at the McArthur River zinc mine power plant in Australia’s Northern Territory. The deal included six of its 34SG engines, providing a combined output of 53 MW, and related engineering services.
Equipment delivery was scheduled to be completed by early 2013, and the power plant is expected to be fully operational by the end of the year. EDL NGD, a subsidiary of Energy Developments, will construct the project and sell the electricity generated by the plant to McArthur River Mining, a subsidiary of Xstrata.
EDL NGD said it was impressed by Wärtsilä’s proposal to supply an efficient power plant solution on a fast-track basis.
Generating Market Growth
With vast regions of the planet relying solely or primarily on diesel-powered generation for electrical needs, the future appears especially bright for manufacturers of the big diesel engines that are commonly used for both mobile and stationary power throughout the mining industry—Caterpillar, Cummins and MTU. A 2011 Frost & Sullivan Research analysis of the power generation market for just the Australian mining industry noted that the rapid growth of that industry in recent years had driven up power consumption and the ‘wear and tear’ rate of generator sets, consequently resulting in higher demand for replacement sales and services. In addition to the opening of new mines, redevelopment and capacity expansions at existing mines was also driving the demand for power, and the remote location of many Australian mine sites require onsite generation to provide power. Consequently, this already mature market, according to Frost & Sullivan, is likely to grow at a compound annual growth rate of 6.7% from 2010 to 2016.
Other less-developed regions in Asia and Africa that have been attracting mining interest are also expected to energize sales of large generator sets, but full genset order books aren’t assured for the brand-name suppliers: As the Frost & Sullivan analysis points out, the growing popularity of cheaper genset imports from China will also compel market leaders to rethink their business strategies. Offering lower-priced products at sometimes compromised quality, Chinese vendors could set off a price war that might ultimately lower market revenues.
The analysis suggests that offering energy-efficient generator sets at competitive prices, as well as maintaining close relationships with key project stakeholders, will help suppliers gain a competitive edge in the market. Direct consultative sales also enable suppliers to establish a sustainable relationship with project owners.
A quick review of recent mining genset-related product and technology developments seems to confirm that not only are the major suppliers designing more cost-effective products, they’re also working more closely than ever with customers to build energy-efficient technology into both stationary and mobile equipment designs.
Caterpillar, for example, not only recently introduced its C175-20 genset—producing up to 4 MW in single configuration and providing the highest power density of any current high-speed generator set—but also has developed off-the-grid technology that will permit mining companies to power a Cat 7495 or 7495 HF electric rope shovel on just 4 MW of generator power, compared with standard practice that uses multiple generators with a total of 8 MW or more capacity to achieve rapid response when peak power is required. In addition to the increase in maintenance and fuel costs associated with a multi-unit generator setup, generator-powered electric rope shovels require additional systems to dissipate regenerated energy because they can’t feed electricity back into the power grid.
Cat’s off-grid power strategy stems from the fact that, because most mines are located in remote areas, it’s common for the nearest power infrastructure to be extremely distant. Mines often plan to break ground at the pit prior to having permanent power infrastructure installed, necessitating the adoption of temporary power solution options at additional expense. Under those circumstances, electric rope shovel customers typically employ diesel-powered loading tools as an interim solution until power is established at the mine. Caterpillar’s off-grid power system, however, affords mining operations the opportunity to use electric rope shovels at the onset of production in a greenfield mine, or to quickly move into a new area at an existing mine in which a stable power supply isn’t readily available.
Using ‘ultra-capacitor’ technology, the off-grid system stores regenerative energy created during swing deceleration and bucket lowering, then uses that power during periods of high demand to reduce the generator load cycle. This innovative technology, currently being validated at the Caterpillar proving grounds in Arizona, is expected to be commercially available in late 2013.
Cat offered introductory details of the off-grid system at its MINExpo 2012 pre-show press event, but has since been relatively silent about the technology as it fine-tunes the system prior to commercial introduction. Recently, however, Ken Banks, new-product introduction manager for Cat’s electric rope shovels, provided E&MJ with an update that clarifies some aspects of its capabilities. And, readers should note that Cat will present the latest information on this technology at Mining Media’s 2013 Haulage & Loading Conference, May 19‒22 in Phoenix, Arizona, USA.
E&MJ: When using the Cat off-grid power supply, will a 4-MW genset handle peak power demand of a 7495 or 7495 HF? If not, give an example of a situation where it would not meet peak demand or where you would not recommend use of the off-grid power supply.
Banks: Generally, 4 MW of genset output coupled with our peak-shaving technology will meet demand from any 7495 model rope shovel. However, at mines operating in extreme temperatures or high altitudes, genset output could be derated. Caterpillar has tightly coupled the rope shovel and gensets to provide the required output needed in all applications. We are able to offer our customers a complete and exclusive Cat solution.
The peak-shaving technology also provides power management benefits to mining operations that are operating on an electrical grid. This technology configuration reduces peak power requirements on the power distribution system, allowing rope shovel customers the opportunity to reduce costs with smaller substations. The lower peak power requirements also allow smaller-gauge trail cables, or longer trail cable runs, which can also reduce costs and minimize downtime.
E&MJ: Will Caterpillar offer both onboard and offboard systems?
Banks: The Caterpillar off-grid power system will have energy storage components integrated onboard the rope shovel, which is currently the most cost-effective solution. Additionally, the onboard solution allows for greater mobility and more manageable machine moves. The offboard system was used for proof of concept testing only.
E&MJ: How many ultracapacitors are used in a system, and what is the anticipated life expectancy of those components?
Banks: The quantity of ultracapacitors is dependent on genset requirements, as well as to optimize capacitor life and machine performance. Ultracapacitors have proven long life in high dynamic load applications, making them the ideal energy storage device for this application.
E&MJ: Is the ultracapacitor technology the same as that used in the 6120B H FS? If not, how does it differ?
Banks: The 7495 and 6120B H FS both use proven ultracapacitor technology. In shovel applications, ultracapacitors store regenerated power fromthe shovel and then draw on that energy during periods of high demand and rapid load changes.
E&MJ: Can the operator feel any differences in machine operation when using the off-grid power supply versus line power?
Banks: The operator’s experience, whether off or on-grid, will be exactly the same. The rope shovel will operate at full productivity, as the Cat off-grid power solution does not alter or derate any functions of the shovel.
E&MJ: What level of cost savings are possible using the off-grid solution?
Banks: The Cat off-grid technology solution allows our customers to operate rope shovels on diesel gensets at less than half the cost of a traditional off-grid rope shovel application due to reduced capital costs and fuel consumption. The fuel savings also contribute to a reduced carbon footprint.
Looking at rope-shovel power supply from another angle, MTU Onsite Energy recently developed a mobile generating solution to help a major North American coal producer move its shovels more efficiently.
Teck Coal, a Canadian producer of coking coal, runs a number of large, AC and DC-driven electric rope shovels at its operations in British Columbia and Alberta. At the company’s Elk Valley operations in southeastern B.C., the shovels normally get power from the utility grid. However, when the shovels move from pit to pit their power source is the mining ‘motivator’, which is essentially a generator set on wheels. At Elk Valley, the existing 30-year-old motivator was underpowered and frequently in need of maintenance. Downtime costs were significant. To solve the problem, a local power products supplier designed an innovative replacement specific to the mine’s needs that relies on a state-of-the-art generator set from MTU Onsite Energy.
“The old motivator was sufficient for some of our older shovels, but it was severely underpowered for a lot of our new shovels,” said Mehul Joshi, P.E., electrical engineer for Teck Coal. “It ran at 1,400 kW, and whenever we tried to move a shovel, the breaker would trip, sometimes as many as four or five times during a move.”
Joshi and his engineering team worked with Cullen Diesel Power Ltd., Vancouver, the local MTU Onsite Energy distributor, to design a new motivator meeting Teck’s needs. The power source in the new motivator is an MTU Onsite Energy generator set that includes an MTU 20V 4000 G83L engine, which meets EPA Tier 2 emission standards in accordance with Teck’s specifications. The genset’s output is rated at 7,200 v and 2,575 kW at an elevation of 1,300 m. With a full tank, the genset can run for more than 7 hours at 100% load and for 20 hours or longer under partial load, said Ethan Baily, a Cullen Diesel generator sales representative who worked on the new motivator design.
When needed at another site, the new motivator can be transported on public highways. “We can remove the mufflers and fold down the roof ladder, and [then] we’re at the upper height limit for traveling on British Columbia highways,” according to Baily.
The enclosure, designed by Alum-Tek Industries, a British Columbia firm that designs and fabricates generator set enclosures, contains all of the motivator’s power-generation and control equipment. A separate control room inside the new unit houses all the electronic components, which are protected by dust-tight enclosures. Keeping the electronics much cleaner than in the old motivator significantly reduces component maintenance and replacement. Because the electronics are in a room separate from the engine, crews working the controls have more space, better air quality and less noise.
The new motivator is about 130% more powerful than the old one—and more than capable of meeting the 1,434-kW peak power needs of Teck’s newest shovels. The rope shovels’ AC and DC drive systems can induce large amounts of harmonic distortion, so Cullen Diesel and MTU Onsite Energy designed a custom alternator that can handle the drive motors’ high levels of harmonic distortion and still maintain required output. This slightly oversized device has a rated capacity of 3,000 kW at 105°C temperature rise.
User-friendly features on the new unit include simpler procedures for starting and operating the engine, and automatic equipment-monitoring systems that indicate problems and eliminate the need for personnel to check gauges and equipment operation. Indicator lights on the control panel, as well as on the outside of the enclosure, ensure that operators can spot problems even when no one is in the control room.
A reserve oil tank automatically levels engine oil, while oil and coolant lines extend to the outside of the unit, allowing faster fluid changes. With occupant safety being a design priority, the new motivator has three exits instead of just one. Two of these are in the engine room and one, a trap-door exit, is in the control room. The new unit also has more sophisticated safety equipment than its predecessor. This includes up-to-date fire-suppression systems, spark-detection devices, and arc-flash relay protection.