CIM Magazine February 2011

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FEATURE: Innovation is vital for Canadian mining industry. How to manage the risks and rewards associated with it remains the crucial question

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<ul><li><p>At Agnico-Eagle Mines Limited (AEM), we understand the value of a precious resource. That is why were committed to being an employer of choice, and to providing our employees with the support and opportunities they need to reach their full potential.</p><p>AEM offers challenging and rewarding careers to individuals with a passion for excellence and a drive to achieve.</p><p>To learn more about employment opportunities with AEM, visit our website.</p><p>THE NEW GOLD STANDARD agnico-eagle.com</p><p>aemopportunity</p><p> 3:40 PM</p></li><li><p> 2011 Caterpillar | All Rights Reserved | CAT, CATERPILLAR, their respective logos, Caterpillar Yellow the Power Edge trade dress as well as corporate and product identity used herein, are trademarks of Caterpillar and may not be used without permission.</p><p>C A T L A R G E M I N I N G T R U C K S</p><p>785 / 789 / 793 / 795 / 797</p><p>One manufacturer. One support network. One leader in performance. In 1984, we built our first large mining truck, a Cat 785. Twenty-six years later, that truck is still hard at work, and we are the market leader. </p><p>Today, as we produce our 10,000th truck, a 793F, we continue to build reliable, durable and safe trucks that help our customers lower their cost per ton. Our experience is our strengthweve proven it 10,000 times.</p><p>10,000 Strong. See the video at cat.com/mining.</p><p>10,000STRONG</p></li><li><p>4 | CIM Magazine | Vol. 6, No. 1</p><p>22</p><p>24</p><p>NEWS 10 Rio Tinto funds new mining frontier Mining giant</p><p>commits $10 million to partnership with the Centre for Excel-lence in Mining Innovation by J. Leuschen</p><p> 12 Caterpillar extends its reach The acquisition ofBucyrus International by Caterpillar gives the equipment manufacturer greater range, but the effects on innovation remain unknown by E. Moore</p><p> 13 Meeting gives spark to groups initiatives The firstannual Women in Mining meeting encourages women to playa greater role in the mining industry by J. Borsato</p><p> 14 International finance conference in China looksto the East The inaugural event brings out the financial community looking to connect Asian capital with Canadian projects by G. Griffiths</p><p> 16 Thwarted PotashCorp takeover leaves trail ofunanswered questions The governments decision tohalt the BHP takeover has raised questions about Canadasopenness to foreign investment by P. Brent</p><p> 20 Pioneers in Canada, and beyond The Canadian Mining Hall of Fame inducts three new members at a sold-outgala event in Toronto by T. Loree</p><p> 22 Chinese rare earth quota boosts Canadian juniors stock The global search for rare earth elementshas ratcheted up interest in Canadas North by V. Heffernan</p><p>UPFRONT 24 Cultural convergence The Canadian</p><p>Opera Companys tour of the Raglan Mineboth introduced the Inuit communities to operaand the troupe to the North by M. Eisner</p><p> 26 Bigger not always better Technologiesthat integrate mine and mill can make marginalhard-rock mines profitable by P. Caulfield</p><p> 28 Sharing knowledge in the digitalrealm The new online resource from theCentre for Excellence in Mining Innovation isdesigned for sharing expertise on mine designby A. Lopez-Pacheco</p><p> 30 Collaboration the key to innovationand success Doug Magoon, chairman ofAMIRA International, discusses the benefits of partnership when it comes to innovationby E. Moore</p><p>CONTENTSCIM MAGAZINE | FEBRUARY 2011 | FVRIER 2011</p><p>PRELIMINARY PROGRAM / PROGRAMME PRLIMINAIRE</p><p>79</p></li><li><p>FEATURED PROJECTPROJET EN VEDETTE 42 Fast-tracking to production Nearing production, Osiskos gold mine operation in Malartic</p><p>is the result of experienced leadership steering the project by P. Diekmeyer</p><p> 49 Un processus acclr; de la dcouverte la faisabilit la productionGrce un leadership dexprience, la mine dor Osisko Malarctic sera bientt en production.</p><p>32FEATUREINNOVATION 32 Stepping up our game Innovation is vital for Canadian mining industry. How to manage</p><p>the risks and rewards associated with it remains the crucial question. by E. Moore</p><p> 40 Intensifier nos efforts Linnovation est essentielle pour lindustrie minire canadienne.Lenjeu cl demeure la gestion des risques et des bnfices qui y sont associs.</p><p>42</p><p>COMMODITY PROFILE 52 The worlds thirstiest metal Tantalums high melt-</p><p>ing point and resistance to rust has made it a very valuablemetal in our daily lives by D. Zlotnikov</p><p>COLUMNS 55 MAC Economic Commentary by P. Stothart 58 Supply Side by J. Baird 60 Eye on Business by P. Swain and A. Benitah 62 Standards by J. Whyte 64 HR Outlook by M. Roberts and L. Forcellini 66 Metals Monitor by the staff of Metals Economics Group 68 Aboriginal Perspective by V. Heffernan 70 Innovation by T. Hynes 72 Safety by S. Dessureault 74 Women in Mining by J. Borsato 76 Mining Lore by C. Baldwin118 Voices from Industry by D. Morrison</p><p>HISTORY110 The foundations of modern economic </p><p>geology (Part 1) by R. J. Cathro113 Social problems in the mining industry </p><p>a historical essay (Part 1) by F. Habashi</p><p>IN EVERY ISSUE 6 Editors message 8 Presidents notes / Mot du prsident116 Professional directory</p><p>NEW!</p><p>February 2011 | 5</p></li><li><p>The meeting of two personalities is like the contact of two chemicalsubstances: if there is any reaction,both are transformed.</p><p>~ Carl Jung</p><p>As we were in the throws of putting together thisinnovation-themed issue, I had the opportunitywith other members of CIMs national office toparticipate in a Myers-Briggs Type Indicator (MBTI)exercise, which indicates how one perceives the worldand makes decisions. The MBTI identifies four pairs of</p><p>contrasting preferences extroverted/introverted, thinking/feeling, sensing/intuition,judging/perceiving which can be combined to form 16 possible psychological types.Although my own assessment of the subject would far exceed what this spacepermits, the timing of the MBTI exercise was perfect. It revealed how differently agroup of people who work together on a daily basis engage in common challenges,and it helped me to formulate a question that has been nagging at me for a while:How can one effectively create a culture of innovation in an organization let alonean industry as vast as mining when we are all wired so differently?</p><p>MBTI proposes that no one type is better or preferred above another. In fact, it isin the collaborative blending of a variety of types that many strengths can bediscovered and weaknesses overcome. </p><p>The same holds true for the mining industry, where the character and culture ofthe laboratory may be vastly different from the mine site, but the engagement ofeach is essential to sparking innovation. In the feature article, Stepping up ourgame, writer Eavan Moore speaks to leaders from all facets of the mining industryabout the traits the Canadian industry must champion and the risks it must manageto ensure its place among the global leaders in innovation. </p><p>We also reached out to AMIRA International chairman Douglas Magoon for athought-provoking Q&amp;A in which he discusses the challenges and opportunities forinnovation, as well as the role of research and collaboration. </p><p>Meanwhile, our project profile, Osiskos Canadian Malartic operation in QuebecsAbitibi region, is a powerful argument for collaborative effort. By fostering closecommunity ties, strong supplier relationships and pioneering technologies, thisproject has been realized despite the recent recession and unique constraints ofoperating so close to a residential area. </p><p>On the subject of collaboration, we would like to hear what you think theCanadian mining industry could be doing to foster innovation. Of course, if you knowof some projects that represent collaboration in action that might not be on ourcollective radar, we would love to hear about those, too. By sharing these with CIMMagazine readers, we can apply our strength to supporting the culture of innovation.</p><p>Angela Hamlyn, Editor-in-chief</p><p>A meeting of minds</p><p>6 | CIM Magazine | Vol. 6, No. 1</p><p>editors letter</p><p>Editor-in-chief Angela Hamlyn, editor@cim.org</p><p>Section EditorsNews, Upfront and Features:Ryan Bergen, rbergen@cim.orgSteve Stecyk, sstecyk@cim.orgColumns, CIM News, Histories and Technical Section:Andrea Nichiporuk, anichiporuk@cim.org</p><p>Technical Editor Joan Tomiuk, jtomiuk@cim.org</p><p>Publisher CIM</p><p>Contributors Jon Baird, Correy Baldwin, Armand Benitah,Louise Blais-Leroux, Jeff Borsato, Paul Brent, R.J. Cathro,Peter Caulfield, Sean Dessureault, Peter Diekmeyer, MarleneEisner, Lindsay Forcellini, Genny Griffiths, Fathi Habashi,Virginia Heffernan, Tom Hynes, Janice Leuschen, AlexandraLopez-Pacheco, Thom Loree, Eavan Moore, Douglas Morrison,Martha Roberts, Staff of the Metals Economics Group, PaulStothart, Philip Swain, James Whyte, Dan Zlotnikov</p><p>Published 8 times a year by CIM1250 3500 de Maisonneuve Blvd. West Westmount, QC, H3Z 3C1Tel.: 514.939.2710; Fax: 514.939.2714 www.cim.org; Email: magazine@cim.org</p><p>Subscriptions Included in CIM membership ($150.00); Non-members (Canada), $168.00/yr (GST included;Quebec residents add $12.60 PST; NB, NF and NSresidents add $20.80 HST); U.S. and other countries,US$180.00/yr; Single copies, $25.00.</p><p>Advertising SalesDovetail Communications Inc.30 East Beaver Creek Rd., Ste. 202Richmond Hill, Ontario L4B 1J2Tel.: 905.886.6640; Fax: 905.886.6615www.dvtail.com National Account Executives 905.886.6641Janet Jeffery, jjeffery@dvtail.com, ext. 329Neal Young, nyoung@dvtail.com, ext. 325</p><p>This months coverSandias Gemini-Scout Rescue RobotPhoto by Randy Montoya, courtesy of Sandia NationalLaboratories</p><p>Layout and design by Cl Communications.</p><p>Copyright2011. All rights reserved. ISSN 1718-4177. Publications Mail No. 09786. Postage paid at CPA Saint-Laurent, QC. Dpt lgal: Bibliothque nationale du Qubec.</p><p>The Institute, as a body, is not responsible for statements made or opinions advanced either in articles or in any discussion appearing in its publications.</p><p>Printed in CanadaKeep the mail coming! editor@cim.org</p></li><li><p>/^</p><p>Service &amp; Repair Centres</p><p>24/7 Emergency Service</p><p>Cost Savings Programs</p><p>With more than 50 branches coast-to-coast, Kinecor is the largest Canadian distributor of industrial components and value-added services.</p><p>Kinecor supports the mining industry by providing turn-key unique challenges. </p><p> Bearings, gaskets &amp; unit blocks Bulk material handling Conveyor &amp; belt components Cylinders &amp; valves &amp; Gear motors &amp; speed reducers Hydraulic hose, adapters </p><p> Hydraulic pumps &amp; motors Lubricants, sealants &amp; abrasives</p><p> Process pumps</p></li><li><p>presidents notes</p><p>Innovation, the theme of thisissue, is a much overused wordand misunderstood process. Ina business context, it is theprocess of turning an idea orsituation into a commerciallysuccessful proposition. It is notabout numbers of patents orlevels of university funding,although they are importantinputs. The key is moving theconcept through test work andtrials to piloting to demonstra-tion scale and finally to marketacceptance. Unless it results inappropriately defined rewards,it is not innovation.</p><p>Like exploration, the devel-opment process often needs</p><p>substantial capital with no return over very long periods. On this basis,I suggest we need a flow-through share concept to spur innovation,similar to that which junior explorers have used to great advantage.</p><p>As Elizabeth Hunt, president of the University of Calgary, recentlywrote in the Globe and Mail, We must ensure that our resource indus-tries are not only innovative, but also seen by Canadians as drivers ofinnovation. </p><p>A number of current initiatives deserve recognition. The commitmentby Rio Tinto to establish a centre for underground mine construction atthe Centre for Excellence in Mining Innovation in Sudbury is a seriousendorsement of our global leading expertise. The formation of a con-sortium for oil sands tailings management research is another signifi-cant development. Seven oil sands majors that have historically sharedminimal R&amp;D or operational information have agreed to pool theirknowledge and expertise to further accelerate the development of tail-ing reclamation techniques. Another interesting development is thecommitment by CEMI and CIM to develop an online mine design hand-book based on the open-access principles of a wiki, an innovative wayto fill a gap in the rapidly developing field of mine design. Readers canlearn more about all three of these initiatives in this issue.</p><p>Innovation occurs in cultural environments that encourage it andexpose practitioners to a wide range of ideas. From this perspective, Iencourage all members to bring more colleagues from non-traditionaldisciplines, such as environmental, mechanical, electrical and civil engi-neering along with other social and financial fields, into CIM. They willinevitably infuse the conversation with different perspectives and sparkfurther innovation. </p><p>Chris Twigge-MoleceyCIM President</p><p>Linnovation, soit le thme de ce numro, est un terme utilis out-rance et un processus souvent mal compris.</p><p>Dans un contexte daffaires, il sagit du processus visant transformerune ide ou une situation en une proposition productive et rentable.</p><p>Linnovation ne se dfinit pas par une quantit de brevets ni par dufinancement universitaire, bien que ces lments constituent des apportsimportants. Il sagit en fait de faire avancer un concept par des essais etdes tudes, puis de progresser jusqu ltape des dmonstrations etfinalement, lacceptation du produit par le march. Si un tel processusne savre pas profitable et fructueux, il ne sagit pas dinnovation.</p><p>Comme les travaux dexploration, le processus de dveloppementncessite souvent des capitaux importants sans quun rendement sur lecapital investi ne soit enregistr pendant de trs longues priodes. lalumire de ces observations, je suggre quun concept de partage et detransfert serait ncessaire pour encourager linnovation, comme un telconcept a t si favorable pour les explorateurs dbutants.</p><p>Comme la rcemment crit lizabeth Hunt, prsidente de lUniversitde Calgary, dans le Globe and Mail : Nous devons nous assurer que nosindustries primaires sont non seulement novatrices, mais aussi peruespar les Canadiens comme des moteurs de linnovation. </p><p>Plusieurs initiatives en uvre lheure actuelle mritent dtre men-tionnes. Lengagement pris par Rio Tinto visant tablir un centre pourla construction de mines souterraines au Centre for Excellence in MiningInnovation (CEMI) Sudbury reprsente un gage important dappui de</p><p>notre expertise reconnue lchelle mondiale. La cration dun grandconsortium pour la recherche en gestion des rsidus du sable bitu-mineux constitue un autre vnement important. Alors quelles avaientpar le pass partag un minimum de renseignements lis la rechercheet lexploitation, sept usines dexploitation de sables bitumineux ontconvenu de mettre en commun leurs connaissances et leur expertisepour acclrer davantage le dveloppement des techniques de valorisa-tion des rsidus. Un autre fait intressant demeure lengagement par leCEMI et lICM crer un guide accessible en li...</p></li></ul>