Centermount Coal starts environmental review for new mine

The British Columbia Environmental Assessment Office sent a Nov. 30 letter to Centermount Coal Ltd. that officially started the pre-application process for an environmental review of the Bingay Main coal mining project, which would feature both deep and surface mining.

This is just the latest of several new or expanded coal mines to go into the EAO review process as coal producers gear up new mines to meet expected long-term demand for British Columbia’s high-quality coking coal. The pre-application process basically involves identifying the impacts of the project that will be covered by an eventual environmental assessment on the project.

Centermount Coal, in a Nov. 20 project description filed with the office, proposed to develop a coal mine, with a maximum capacity of 2 million clean tonnes per year (Mt/year), called the the Bingay Main Coal Project. It is in the Elk River valley, approximately 21 kilometers north of Elkford, in the East Kootenay portion of the Rocky Mountain coal field of southeastern British Columbia. The project would produce high quality metallurgical (coking) coal for the steel industry.

“The Rocky Mountain coalfield currently supports five large coal mines and is serviced by major infrastructure such as railroads, provincial highways, natural gas, water, numerous hydro-power lines, communications and four resource coal mining towns,” said the company submission. “Large-scale underground and open pit coal mining has been ongoing since 1911, and the area currently produces 23 Mt/year of coal, primarily coking coal for the steel industry. The centre of the coal deposit is located 193 road kilometres northeast of the City of Cranbrook, which is a major industrial centre for mining and forestry, and is also a railway centre for the Canadian Pacific and Union Pacific railways.”

Centermount holds coal licenses totaling 1,157 hectares near the confluence of Bingay Creek and the Elk River. The coal deposit is within the Bingay syncline, a steeply dipping bedrock fold which dips to the northeast beneath the Elk River. At least 32 coal beds are present in this area, ranging in thickness from 0.3 to 16.2 meters. Of these coal beds, 24 are typically at least 1 meter thick, inclusive of contained bands of rock. Cumulative thickness of these coal beds is 62.6 meters, within an overall coal-bearing rock thickness of 460 meters.

Project includes mines, processing plant and 27-kilometer rail line

Major components of the project include an open pit and underground mine, coal processing facilities, temporary and permanent waste rock dumps, a 27-kilometer rail line, and a rail loadout. The rail line will be located on Crown Land on the east side of the Elk River. Access to the mine is via the Elk River Forest Service Road (FSR) along the west side of the Elk River. A FSR and transmission line also parallel the east side of the Elk River. The new rail line would connect the project to an existing CP rail line near Teck Coal’s Greenhills operation.

“Three types of metallurgical coal similar to that produced in adjacent coal mines would be generated by the Project,” the company said. “Coal would be processed on site using a combination of heavy media cyclones, water only cyclones, spirals and classifying cyclones, and froth flotation depending on the size of the coal. Coal dewatering will be done mechanically using screenscroll centrifuges, screenbowl centrifuges and hyperbaric filters, rather than thermal dryers. Coal produced at the mine would be transported to shipping terminals near Vancouver via CP Rail.”

The Bingay Main Coal Project is wholly owned by Centermount, a private, Canadian company with its head office located in Vancouver, B.C. Centermount is 55% owned by Centerpoint Resources Inc., also a private Canadian company, with the remaining 45% owned by two Chinese private shareholders. Bingay Main is the only project owned by Centermount. Centermount said it has eight full-time, permanent employees and has engaged a group of consultants with specialized expertise to assist in the development of the project.

Key members of the Centermount management team include:

  • Honourable Jack Austin (Chairman) – Austin has law degrees from the University of British Columbia and Harvard Law School and has specialized in trade and commercial law in Vancouver for over 20 years. Austin is a former senator for the government (1975-2007), and has served for four years as the Deputy Minister of Energy, Mines and Resources, one and half years as Chief of Staff to Prime Minister Pierre Trudeau, and was a Cabinet Minister in both the Trudeau and Martin governments. From 1993 to 2000, Austin served as the President of the Canada China Business Council.
  • Edward (Ted) Nunn (President) – Nunn is a Professional Engineer with over 43 years of experience in the mining industry. Nunn’s career includes 22 years of coal and industrial minerals for Kaiser Resources, An Tai Bao Surface Coal Mine (China), Greymouth Coal (New Zealand), and Crystal Graphite Corp. (Canada and China).

Property has history of exploration over a period of decades

Between 1902 and 1981, coal licenses at Bingay Main have been held by the Elk Valley Coal and Coke Co., Cominco and Specific Natural Resources, although details regarding exploration work on the site are limited. In 1982, W. Shenfield and S. Gardner staked the property, then subsequently sold the property to Utah Mines in 1983. Utah Mines conducted some exploration work in the autumn of 1983. In 1986, Utah Mines abandoned its interests and the property reverted back to Shenfield and Gardner in May 1987. In 2004, Hillsborough Resources Ltd. optioned the property and conducted an extensive exploration program. The coal licenses were subsequently transferred to Hillsborough, which developed the property enough to prepare and submit an application for a Small Mine Permit in 2007. Hillsborough withdrew this application in order to focus on other projects. In October 2009, Centermount acquired the area from Hillsborough, and conducted further exploration work in 2010 and 2011.

The project is projected to produce metallurgical coal at an annual maximum rate of 2 million clean tonnes (about 5,500 tonnes/day). The lifespan of the project is planned for 20 years of coal production at a constant rate. A preliminary mine design estimates 10-15 years of shovel-and-truck operation open pit mining, followed by underground mining for the remaining years, although the property has potential for additional resources.

“Centermount is proposing to develop a coal mine that would extract 39 million tonnes (Mt) of clean metallurgical coal (coking), suitable for use in overseas steel mills,” the company noted. “Global steel production has increased an average of 5.4% since 2000 (WSA 2011), with 1,490 Mt of steel produced in 2011. At present, 70% of world steel production uses coking coal, with the remainder produced by recycling scrap steel. Coking coal is an essential component of steel production. Each tonne of steel produced requires approximately 600 kg of coke, which is produced from 770 kg of coking coal.”

A preliminary feasibility study estimated project capital costs at C$480m. This includes the initial mining equipment, processing plant, conveyors, administrative and maintenance buildings, the rail line and loadout, roads and bridges, engineering, and owners costs. During operation, the project is anticipated to require 331 full time employees.

The Bingay Main coal deposit is planned to be mined using the conventional bench-by-bench (15 meter) open-pit mining method, which includes excavation of overburden, drilling and blasting of rock, ripping and bulldozing coal, loading with a hydraulic shovel and a front-end loader, and hauling coal with 100-tonnes capacity trucks and waste rock with 240-tonnes capacity trucks. The strip ratio is variable but is expected to average 6 bank cubic meters (BCM) per clean tonne mined. Based on the level of production and the strip ratio, the mining fleet planned for the operation consists of one P&H2800XP electric shovel (or equivalent), one hydraulic shovel, eight 240-tonne capacity haul trucks, four 100-tonne capacity trucks, two diesel electric rotary drills, two large front-end loaders and two D10 bulldozers.

The underground operation would commence when the open pit operation is phasing out. The development would be approximately within the open pit footprint and generally to the north and south at elevation levels between 250 meters and 500 meters below the surface. The structure of the deposit is suitable for underground hydraulic mining, which uses a high pressure water jet to extract coal, a method that has been used in the Elk River valley coalfield for many years, the company noted.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.