1. Working with International Standards and Practices
Mining & Mineral Processing in Europe 2016
Working with International Standards and Practices
and the Value of Auditing in the Mining Environment
Merlin Thomas
Mining & Mineral Processing in Europe 2016

2. Mine Development Stages
Activity
Objectives
Exploration
Mapping
Drilling
Prove up an economic resource
Planning & Design
Block model
Mine plan
Feasibility studies
ESIA
Mining licence
Environmental licence
Exploitation permit
Construction
Site preparation
Pre-stripping
Plant construction
TSF construction
Services infrastructure
Development of site for commissioning and commercial production
Production
Mining
Processing
Waste disposal
Economic production
Closure
Decommissioning
Remediation
Remediate and restore site
Find alternative use
Mining & Mineral Processing in Europe 2016

3. Definitive Feasibility Bankable Feasibility +/- 15%
Feasibility Studies
Level
Accuracy
Purpose
Conceptual
Scoping
< 50%
Is there a project?
Pre-Feasibility
< 25%
Financing
Sale
Feasibility
Definitive Feasibility
Bankable Feasibility
+/- 15%
Detailed Design
+/- 5%
Construction
Note: Ore Reserves are included within the mineral resources
Mining & Mineral Processing in Europe 2016

4. International Standards & Practices
Resource/Reserve
JORC NI
Resource statement by competent person
Mine Planning & Design
Block Model
Mine Plan
Plant
Metallurgical Sample
Metallurgical Testwork by accredited laboratory
Process Flowsheet
Equipment Selection
Mining & Mineral Processing in Europe 2016

5. International Standards & Practices
Waste Dumps
Tailings Dams
Australia
Canada
South Africa
Environment/Social Community
Equator Principles
IFC Performance standards (WBG EH&S Guidelines)
International Cyanide Code
Extractive Industries Transparency Initiative
OECD Guidelines for Multinational Enterprises
Mining & Mineral Processing in Europe 2016

6. Stakeholders Government Local Population Financiers Mining Operation
Employees
Shareholders
Suppliers
Off-takers
Local Population
Mining & Mineral Processing in Europe 2016

7. Common Issues Perception External Regulation World Bank, IFC
International Human Rights Commission
Project Progress Disrupted
Transfer of ownership
New standards
Project Stops Delivering
Flaws in original design
Performance criteria not attained
Note: Ore Reserves are included within the mineral resources
Mining & Mineral Processing in Europe 2016

8. Common Issues Range of Standards Different Objectives
Lack of Transparency & Trust
Breakdown of Relationships
Note: Ore Reserves are included within the mineral resources
Mining & Mineral Processing in Europe 2016

9. Mining & Mineral Processing in Europe 2016
Auditing
Internal Audits
Weekly/Monthly
Quarterly/Annual
Company Driven
Performance improvement
Due diligence
Second opinion
External Audits
Annual
Quarterly
Ad hoc
External Stakeholder Driven
Government
Lenders
IFC
Note: Ore Reserves are included within the mineral resources
Mining & Mineral Processing in Europe 2016

10. External Consultants Advantages Independent
Flexible – available to do more or less work
Mobilisation – generally fast
Trusted
Disadvantages
Cost
On site for short periods
May not speak the language or understand the culture
Can lose focus
Mining & Mineral Processing in Europe 2016

11. Mining & Mineral Processing in Europe 2016
Choice of Consultants
Geographical Location
Travel
Rates
Language
Confidence
Experience
Relevant Experience
Known
Trusted
Availability
Mining & Mineral Processing in Europe 2016

12. Example 1: EU Horizon 2020 FAME Project
Mining & Mineral Processing in Europe 2016

13. Example 1: EU Horizon 2020 FAME Project
Mining & Mineral Processing in Europe 2016

14. Example 1: EU Horizon 2020 FAME Project
Mining & Mineral Processing in Europe 2016

15. Example 2: HazChem Audit
Hazardous chemical transport audit, West Africa
In response to pressure on the government from press and media
Transportation of mining chemicals from port to mine site approximately 275 km
Three contractors with 1/3 share each
Best contractor responsible for transport of cyanide
Audit carried out with Mines Police from Dept of Mines and representatives from Dept of Environment
Note: Ore Reserves are included within the mineral resources
Mining & Mineral Processing in Europe 2016

16. Example 2: HazChem Audit
Subsequent audit to International Cyanide Code
Supplier, transportation, storage, usage, disposal
Major improvements from transport contractors
Confidence from Government Ministries
Participation in the Extractive Industries Transparency Initiative
Using Equator Principle conformance
Benefitted the major stakeholders, government, owners, contractors, employees, population
Note: Ore Reserves are included within the mineral resources
Mining & Mineral Processing in Europe 2016

17. Benefits of Auditing
Effective method for new operations to evaluate performance
Objective
Impartial
Reproducable
Scorable
Identify risks & areas for improvement
Evaluate internal control systems
17 Mining & Mineral Processing in Europe 2016

18. Common Misconceptions
Negative aspects of auditing
fear of non-conformance or
being caught out is to be discouraged
Waste of time
Aimed at finding fault
Truth should be concealed
Get it over quickly for another year
18 Mining & Mineral Processing in Europe 2016

19. Increase understanding Create better working relationships
Maximise Benefit
Treat the audit as a positive management tool
Benefit operation
Increase understanding
Improve performance
Create better working relationships
Advance communication between auditor and auditee
Scope
Objectives
19 Mining & Mineral Processing in Europe 2016

20. Benefits of Audits Management Tool Better Understanding
Increased Confidence
Measurables for Comparison
Generates Statistics
Trackable Year on Year
Use as Positive Management Tool
Creating Better Working Relationships
Identify Gaps
Ensure Project Delivers
20 Mining & Mineral Processing in Europe 2016

21. Summary
Use of recognised International Standards are key to ensuring the conformance of mining projects to external regulation
Particularly helpful where there are international stakeholder partnerships involved
Combination of external auditing using reputable consultants from Europe, Australia, America and South Africa, and local government departments has proved effective in building trust and confidence
Most benefit realised where auditing has continued on a regular and voluntary basis
Example of audit embedded into the project from conception as part of the management system
Second example of compliance audit gaining support and being used by government and contractors to demonstrate best practice
21 Mining & Mineral Processing in Europe 2016

22. Thank You
22 Mining & Mineral Processing in Europe 2016