Smelter proposal based on custom facility on tidewater

Several small copper smelters operated in British Columbia during the early part of this century, but each died with the exhaustion of reserves of the nearby mines. During the growth of the province’s copper mining industry in the 1960s, world-scale smelters were considered but not established.

Today, no copper smelters exist in British Columbia or on the west coast of North America. Recent developments in the world copper smelting industry indicate that a shortage of world copper smelting and refining capacity will develop in the 1990s. This may lead to the establishment of a large copper smelter/refinery in British Columbia.

The provincial and federal governments provided financial support for preliminary feasibility studies recently carried out by PRM Resources of Vancouver. These studies included assessments of markets, costs, financial feasibility, concentrate supply, site suitability, and environmental and socioeconomic impacts.

In an information memorandum, the provincial government stated: “Preliminary feasibility studies indicate that as a result of a world copper smelting shortage expected to develop during the 1990s and continuing firm copper smelting and refining terms, it would be profitable to establish a copper smelter and refinery with a capacity of 150,000 tonnes per year in British Columbia.”

The capital cost of the project is estimated at $450-500 million. The smelter would be able to process concentrates from British Columbia and from overseas. A potential site has been identified in Kitimat, on the province’s north coast.

A world-scale copper smelter was never developed in British Columbia because world smelter capacity was viewed as sufficient, and because most new copper projects in the province benefited from the low smelting and refining charges available from Japanese smelters.

But a number of developments in world copper markets are affecting the economics of copper smelting in British Columbia in a positive way. For example:

— Japanese smelting and refining charges are under upward pressure in response to the expected strengthening of the yen and removal of Japanese tariffs on imports of refined copper.

— A number of old, inefficient and highly polluting smelters in various countries are expected to be shut down within this decade.

— Copper prices have, in the last few years, moved into a higher plateau, with the result that large additions to world mining capacity are scheduled in the next few years.

Roger Taylor, president of PRM Resources, believes there is a fundamental difference between the approach taken by his firm and all previous feasibility studies.

“PRM has examined this project on the basis of a custom smelter on tidewater that would serve a variety of producing mines over an unlimited time frame,” he said. “Previous studies were generally based on feed from specific mines at locations in the interior of British Columbia.”

Preliminary feasibility studies indicate that more than 300,000 tonnes per year of copper in concentrates would be available from existing and potential mines within the province as new mines are developed over the next 15 years. These mines would be able to support a 150,000-tonne-per-year smelter in Kitimat and still export significant quantities of concentrate. Apart from the fundamental requirement to demonstrate that the project is viable, a key consideration of PRM is to establish the support of the British Columbia mining industry and to coordinate the start- up of the smelter with the new copper mine developments in northern British Columbia, and offshore, so that there is no disruption of the established trading arrangements of existing producers in British Columbia.

Several major mining companies active in the Cordillera have already said they would use the Kitimat smelter if it is competitive with offshore smelters. But some leading mining executives point out that operating a smelter profitably is no easy task, particularly if copper prices move into a prolonged downward trend.

The proposed project is expected to include a copper smelter, refinery, sulphuric acid plant, bulk handling and storage sheds and accompanying infrastructure. The Outokompu flash smelting process and the Isa electrorefining process, as well as alternative processes, are being considered.

The direct work force for the project would number about 450. The by-products of the smelting process, all of which are expected to have a market, are slag, sulphuric acid or elemental sulphur, and various by-product metals such as silver and gold.

Using proven state-of-the-art pollution control equipment, sulphur recovery is expected to exceed 99.5%. With a closed circuit cooling system, there would be no discharges into the aquatic environment. Slag would be loaded onto barges for industrial use elsewhere. Sulphur or sulphuric acid produced in the process will also be marketed for industrial purposes, such as fertilizer manufacturing.

Kitimat already has a well-developed industrial base featuring an aluminum smelter, pulp and paper production facilities, and a methanol and ammonia complex.

“Preliminary feasibility studies of this project have identified no environmental or socioeconomic issues which would preclude the development of a copper smelter and refinery at the proposed location in Kitimat,” a government report stated.

PRM is planning detailed studies of the proposed copper smelter that would take them from the approval process to a production decision.