Two mines. Two seams. one parTnership. 10...Caterpillar customers are finding in the use of scales for payload optimization. You’ll learn about our company’s efforts to make engines

SCALE STudIES hELP mInIng ComPAnIES

maximize payload, InCREASE PRoduCTIon

CATERPILLAR AdVAnCIng ThE uSE oF ALTERnATIVE FuELS

In mInIng APPLICATIonS

A publication of Caterpillar Global Mining

2013: issue 10

Two mines. Two seams.

one parTnership.CAT dEALER And CuSTomER STREngThEn RELATIonShIP

In RICh CoAL bASIn

Russian coal mine continues to set

produCtion reCordsFoRTESCuE mETALS ImPLEmEnTS nEW CATERPILLAR AuTonomouS

mInIng SoLuTIon

c caterpillar Global mining / Viewpoint / issue 10

Together with our dealers, we’re supporting

customers like never before. In this issue you’ll

read about Armstrong Energy, which recently took

delivery of the world’s first full fleet of Cat® Room

and Pillar mining equipment and now partners

with Cat dealer Whayne Supply for both its surface

and underground coal operations. The Tugnuysky

coal mine in Russia is setting production records

with a Bucyrus 495 HD Electric Rope Shovel, now

supported by Cat dealer Vostochnaya Technica.

These challenging times also give us an opportunity

to work hand in hand with our customers to

help them become more efficient and lower their

overall operating costs. In this issue you’ll read

about our alliance with Transcale and the value

Caterpillar customers are finding in the use of

scales for payload optimization. You’ll learn about

our company’s efforts to make engines that can

run productively on Liquefied Natural Gas, an

economical and clean-burning alternative to diesel.

And you’ll see how we’re working with our customer

Fortescue to deliver an autonomous mining solution

that delivers increased productivity and safety—at

lower costs.

Good things continue to happen in this important

industry, and we’re proud to be able to share some

of these stories with you. We’re committed to

mining and we’re committed to you.

Chris CurfmanPResident mininG sales & suPPoRt diVision

tony Johnson, editor. david edwards, safety & sustainability. sean Gladieux, Product support. Mindy elsasser, Product support marketing. Kent Clifton, applications. renee Balaco/Charlie Zimmerman, Global marketing. Becca Corrao/ Jim Gross, americas north. denise encalada/Luis ossandon, americas south. dan Wyatt/sheri Lim, asia Pacific. robert Greiff/Martin Gill, europe, africa, middle east, india. Mary Wang, china. Matt Wahrenburg/Mike unes, Global accounts. Kim Bailey, Product marketing. Aaron Lowe, large track-type tractors. Alan pumklin, loaders. Allison Macaione, Rope shovels. tony donovan, Hydraulic shovels & draglines. Jackie Kauffold, scrapers & off-Highway trucks. roschelle McCoy, technology. Wrenn Miles, Room & Pillar. Bill shaner, mining trucks. Lou Mcduffy, drills. egbert Janik/Joe Bontje, uG Hard Rock. Guido schawohl, longwall systems. Barbara Cox, Public affairs. Converse Marketing, Publisher.

Viewpoint is a publication of caterpillar, producer of the mining industry’s broadest line of surface and underground equipment and technologies. caterpillar is headquartered in Peoria, illinois, usa, and serves the mining industry through its caterpillar Global mining organization, headquartered in milwaukee, Wisconsin, usa.

editoriAL BoArd:

Over these last few months, as we’ve been putting together this new issue of Viewpoint magazine, we’ve also been experiencing uncertainties in the global mining industry. But in spite of this challenging economic environment, we continue to have many great success stories to share.

caterpillar Global mining / Viewpoint 1

scale studies HelP mininG comPanies maximize Payload, incRease PRoduction 4

8tWo mines. tWo seams. one PaRtneRsHiP.

autonomous mininG solution

taBle of COntents

Russian coal mine continues To SET PRoduCTIon RECoRdS 20

CAT dEALER And CuSTomER STREngThEn RELATIonShIP In RICh CoAL bASIn

FORTESCUE METALS IMPLEMENTS NEW CATERPILLAR 2

CATERPILLAR AdVAnCIng ThE uSE oF

alteRnatiVe fuels In mInIng APPLICATIonS 18

neWs fRom cateRPillaR 29mininG foR a betteR WoRld 26

2 Caterpillar global mining / Viewpoint / issue 10

In less than a decade, Fortescue Metals Group firmly established itself as one of the world’s leaders in iron ore production — strategically achieving goal after goal in its development of the resource-rich Pilbara region of Western Australia.

The recent opening of its Solomon project was the

next step in completing a suite of iron ore mines

in the region that will help the company achieve

its annual target of mining 155 million tonnes

(160 million tons) of iron ore by March 2014.

Technology and innovation have been key to the

company’s significant achievements — and the

company’s recent installation at its new Solomon

operations took innovation to the extreme with

an autonomous hauling solution developed in

partnership with Caterpillar.

bEComIng A nEW FoRCE In IRon oRE

Construction of Fortescue’s initial mine, rail and

port project began in early 2006. Just two years

later in early 2008, the rail and port infrastructure

were completed and operations were under way at

Cloudbreak, Fortescue’s flagship mine.

In the first full year of operations, Fortescue mined,

railed and shipped more than 27 million tonnes

(30 million tons) of iron ore to customers in China.

The following year saw 40 million tonnes

(44 million tons) delivered and more than

55 million tonnes (60 million tons) in 2012.

Current expansion plans are committed to

increasing Fortescue’s production capacity to

155 million tonnes (170 million tons) per year.

Many significant milestones have been achieved

in Fortescue’s short history, including the

establishment of Fortescue’s second mine site at

Christmas Creek, which combined with Cloudbreak

operations comprise the Chichester Hub, and the

recent opening of the Solomon Hub. Located 120

kilometers (75 miles) west of the Chichester Hub,

Solomon comprises the Firetail mine and the Kings

mine. More than 3 billion tonnes (3.3 billion tons)

of resources have been identified at Solomon,

providing Fortescue with a long-term, low-cost

production strategy.

The USD$3.5 billion Solomon site has two ore

processing facilities, three crushing hubs, a power

station, its own airstrip and three camps to house

3,000 people. In 2012, Fortescue opened the

129-kilometer (80-mile) Solomon Railway, which

connects Solomon to Fortescue’s mainline to Herb

Elliott Port. The operation started loading at 16

trains per month, increasing to 55 trains per month

at full production.

LEVERAgIng AdVAnCEd TEChnoLogIES

For the last several years, Fortescue, Caterpillar,

and Western Australia Cat® dealer WesTrac have

been working together to fully implement the Cat®

MineStar™ System in an effort to get the highest

productivity and improve safety at the company’s

new Solomon operations. The greenfield mine

FortesCue MetALs iMpLeMents neW CAterpiLLAr AutonoMous MininG soLution

brought together a skilled team from all of the

organizations to deliver an efficient, cost-effective

technology solution.

Cat MineStar System is a broad suite of integrated

mine operations and mobile equipment

management technologies, configurable to suit

the needs of the operation. It consists of five

capability sets — Fleet, Terrain, Detect, Health

and Command — that use technology to help sites

manage everything from fleet assignment and

condition monitoring to remote and autonomous

control. The system integrates a site’s products,

processes and people to deliver gains in productivity,

efficiency and safety.

Delivery, installation and support of the complete

technology suite was implemented for the

first phase of Solomon — the 20-million-tonne

(22-million-ton) per-year Firetail manned mine, in

October 2012. Eight Command for hauling Cat 793F

CMD trucks were commissioned and commenced

operations in the second quarter of 2013 as part

of an autonomous mining solution for phase

two — the 40-million-tonne (44-million-ton) per-year

Kings mine. The mine plan calls for a progressive

ramp-up to 45 autonomous trucks over the next

several years.

In addition, the remaining Cat MineStar System

capability sets are being utilized across the mobile

equipment fleet, including support equipment and

light vehicles.

Working closely with Fortescue and its mining

contractor, Leighton Contractors, both Caterpillar

and WesTrac are providing a full solution for

managing, operating and supporting Cat MineStar

System and Command for hauling.

“Caterpillar is pleased to team with Fortescue

and Leighton Contractors for the operations of

our autonomous mining solution,” says Chris

Curfman, president of the Caterpillar Global

Mining organization’s sales and support division.

“Working with all the partners, we look forward

to managing the entire Cat MineStar System suite

of technology products at Solomon in order to

drive process efficiency, increase productivity and

enhance safety. The Solomon project is an excellent

fit for our progression to the next level of technology

and sustainable mining — with the ultimate goal of

delivering greater value for our customers.”

The Solomon mine is the first project of its kind

for Caterpillar, using Cat MineStar System for both

autonomous and manned machines on the project’s

two mines. “The depth and breadth of the Cat

precision technology, coupled with skilled control

personnel, is designed to enable the dual fleet to

work safely and efficiently and to reach production

goals quickly,” says Hans Haefeli, Caterpillar vice

president for the company’s advanced components

and systems division.

Fortescue Chief Executive Officer Nev Power said

the implementation of a state-of-the-art mine control

and management system at Solomon was consistent

with Fortescue's drive for greater productivity, lower

costs and a safe operating environment. It also helps

contribute to the company’s goal of providing new

opportunities to local people with a variety of skill

sets, says Power.

“Innovation and creativity led to Fortescue’s

discovery of Solomon in 2005 and we are

maintaining that spirit of innovation with the

implementation of Cat MineStar System,” he said.

“At full operations, Solomon will have a workforce

of about 1,200 people. Autonomous haulage will

provide a highly efficient, productive and safe

environment that complements manned operations.

It enhances safety through reduced interaction

between heavy equipment and people in mining

areas utilizing collision avoidance technology.

The industry timeframe for achieving an annual

production of 40 million tonnes (44 million tons)

from a traditional mining development is 12 years;

Solomon expects to reach that capacity in just

over three years, ahead of even the company’s

four-year target. π

4 caterpillar Global mining / Viewpoint / issue 104 caterpillar Global mining / Viewpoint / issue 10

With the exception of the safety of its people, nearly

every mining operation has one priority in these

challenging economic times: Lowering its operating

costs. The more productively, efficiently and cost-

effectively a mine can operate, the more profitable it

will become.

Continuous improvement is a must. Mining

companies around the world are evaluating

their operations, their equipment, their

maintenance practices and their operator

performance — recognizing that even the slightest

improvements can reap great benefits.

A number of mines are beginning to recognize a

tool that can make a significant contribution to this

effort: Scales. Whether they are permanent fixtures

or temporary installations for a one-time study,

scales help make it possible for mines to lower their

costs in a number of ways.

Scales can help mine sites:

» Maximize payload and increase production

» Validate onboard payload management systems

» Improve the return on investment for a truck fleet

» Increase operational efficiencies

» Reduce fuel usage and lessen carbon footprint

» Decrease overall operating costs

» Reduce maintenance costs

» Extend the lives of equipment,

components and tires

“While scales can have an impact in many areas,

what it really comes down to is maximizing

payload,” says Kent Clifton, senior product/

application specialist in the Caterpillar Global

Mining organization. “You know your truck’s rated

payload. When you measure what you’re carrying,

and think about what you’re missing if you’re not

getting the maximum load in every cycle, it’s pretty

easy to see what that’s costing you. If you’re not

carrying the rated load, you’re leaving money on

the table. And depending on the commodity you’re

hauling, that can be a significant loss.

“On the other hand, if you overload a truck,

you can do structural damage, increase fuel

burn, reduce component life, reduce tire

life,” he continues. “So you’re taking the

life out of the truck and its components and

spending more.”

Caterpillar uses a 10/10/20 policy —

recommending that no more than 10 percent

of loads are over 110 percent of target payload

and never exceed 120 percent. The mean of

the payloads should not exceed the target payload.

“It is a balancing act,” says Clifton. “These reasons

make accurately measuring your payload vital. And

that’s what scales can do.”

PRoVIdIng ThE RIghT SCALES FoR ThE job

The ability to work alongside customers, hand

in hand with Cat® dealers, is one of the reasons

Caterpillar formed its Global Mining Organization

nearly 15 years ago, recalls Clifton. In addition to

serving as a single point of contact for Caterpillar’s

global mining customers, the organization also

looks for ways to help customers better use their

Cat equipment.

“One of the ways we do that is by developing

relationships with other companies and

organizations that ultimately will benefit our

customers,” says Clifton. “For example, we partner

with our customers who are members of the Earth

Moving Equipment Safety Roundtable (EMESRT)

to find new ways to build safety into our products.

We have an alliance with a company (Immersive

Technologies) that builds simulators to help train

operators. And when it comes to scales, we work

with Transcale.”

Since 2000, Caterpillar has worked with this mining

scale technology leader, which has more than 20

years of experience and a presence in 25 countries

worldwide. In 2010 the two companies signed a

working alliance.

“Like Caterpillar — and many of our mining

customers — Transcale is a global company,”

SCALE STudIES hELP mInIng ComPAnIES

mAxImIzE PAyLoAd, InCREASE PRoduCTIon

says Clifton. “It’s a good fit for our industry.

Wherever we go, we have consistent tooling and

processes and we have one source for questions

and support.”

Ross Grayson, Transcale CEO, says the alliance

encourages Caterpillar customers to make

measuring payload a regular part of mine

site operations. “Once a required change has

been identified and executed, the biggest

challenge to sustain productivity windfalls

is to have the continued measurement and

reporting mechanisms become part of the

daily process,” says Grayson. “The alliance

provides a platform that is being used to

have our scale and volumetric measuring

technologies become part of the daily regimes

with mining companies. Initiatives such as

real-time interfacing and reporting through

the Cat MineStar™ System enable the end

users to use Caterpillar’s Vital Information

Management System (VIMS) and Truck

Production Management System (TPMS) data

for production measuring with confidence.”

Customers who want mobile or permanent

installations can purchase scales directly from

Transcale or through their local Cat dealers that

also distribute Transcale products. In addition,

Caterpillar owns several sets of scales that are

used by dealers and customers around the world

to perform payload studies. Caterpillar also uses

its scales to evaluate new products in development

and to compare machines to those offered by its

competitors.

PERFoRmIng SCALE STudIES

The scales owned by Caterpillar Global Mining

are used for continuous improvement projects on

customer sites, such as conducting payload studies,

validating on-board systems and determining the

exact target payload when a new truck is put into

operation. A scale study is a comprehensive,

well-defined process.

“When we do a study we must meet certain

criteria,” says Tony McGuire, a Caterpillar systems

application specialist. “We need to make sure we’ve

selected a location in advance and prepared it for

the scales. We also need to make sure we’re going

to have the necessary support equipment and

personnel scheduled.”

The typical installation consists of two platforms,

each weighing one side of an axle. Approach paths

are constructed on either side, then compacted

and made level with tops of platforms so no weight

is transferred to or from the axle being weighed.

Caterpillar recommends that scales are never buried

in a pit or trench. Rain or poor drainage also can

impact the accuracy of scales.

“If the platforms are correctly installed, the

brakes can be released and the vehicle will not roll,”

says Clifton.

Once personnel are confident that the scales are

level, the next step is to make sure the load weight

measurements are consistent. To do this, a truck

operator pulls the front tires on the scales, and then

does the same with the back tires. Next, the truck

turns and follows the same process going in the

opposite direction.

“These two weights must be within 1 percent of

each other,” says McGuire. “We look at all four

VoLumE PoSITIonIng FRAgmEnTATIon dEnSITy CARRy bACk

2

corners. And we do this same check three to four

times a day to make sure we’re staying accurate.”

A well-executed scale study will weigh at least

50 percent of the trucks running on the site, says

McGuire. These same trucks will be weighed

10 to 15 times each.

“When we’re on site to perform a scale study,

we try to cause as little disruption as possible,

pulling a truck for just a short time,” says Clifton.

“Once the scales are properly installed, we can

weigh a truck in less than 90 seconds.”

VALIdATIng on-boARd SySTEmS

While many of today’s machines have on-board

technologies that help sites

manage the loading process, like

VIMS and TPMS, it’s important

to measure and calibrate these

systems to ensure their accuracy.

That’s why Newmont Mining

Corporation brought Caterpillar

and its local dealer, Mantrac

Ghana Ltd., to the Newmont

Ghana Gold Ltd. (NGGL) Ahafo

gold mine in Ghana, Africa, to

identify and find ways to correct

some ongoing problems. The

site relies on a fleet of 38 Cat

785s to handle material haulage.

“The site was struggling to identify the correct

payload based on inconsistent VIMS reports and

unconfirmed truck empty weight, and they were

skeptical of the maximum gross weight,” says

Mantrac’s Andrew Broadbent.

McGuire, who helped perform the study at Ahafo,

recalls that a number of issues were causing

concern to the operations team. “They weren’t

confident that they were properly maintaining

payload despite leveraging the onboard TPMS,” he

says. TPMS is a tool that tracks loads, cycle times

and payload data. Indicator lights or digital displays

on the truck tell the loader operator when the truck

is fully loaded. Data is reported through an on-board

display or through VIMS.

Caterpillar has a defined process that should be

followed to ensure the accuracy of TPMS, says

McGuire. It must be validated and calibrated to

ensure the machine is actually carrying the amount

the system is reporting has been loaded.

“We came in to help them work on TPMS accuracy,”

says McGuire. “Things weren’t matching up and

they asked us to help. We put in a set of scales and

performed a study, which revealed that the dealer

and the mine were not properly adjusting struts.

This was to blame for inaccuracies in the TPMS

data.

“We took four trucks and re-did the strut

procedures, working with the dealer and the mine

to ensure they understood the proper steps. Then

we tested again. The study proved that if you control

the strut process, TPMS is right on target, within a

range of 3 to 5 percent.”

When the TPMS was corrected, the site made an

unwelcome discovery: The accuracy of the system

previously had been only about 18 percent. “When

you figure that every truck in their fleet was using

TPMS, and the loading units were only accurately

filling them about 18 percent of the time, that could

be a significant loss of revenue,” says McGuire.

Performing the scale study revealed the issues, and

the dealer and the site learned the importance of

properly maintaining the TPMS system. “Proper

service, recalibration, proper load placement — all

of these things took on a new importance,” says

McGuire. “And now the system is 2 to 3 percent

accurate.”

Newmont continues to leverage information from

the study, says Broadbent. “The payload study

precisely identified every parameter and matched

VIMS payload reports on trucks with accurately

charged suspension systems to actual load values,”

he says. “This has provided information enabling

further studies to be deployed on body weight and

body volume versus gross vehicle weight — both of

which will help to optimize the maximum tonnes

hauled without overloading.” The benefits of

1/ the transcale tare Weight certification system measures empty trucks to accurately determine the target payload.

2/ the Volumetric scanning system uses 3d imaging to calculate the volume of material

1

6 caterpillar Global mining / Viewpoint / issue 10


optimizing payload has led the site to order a set of

scales to be installed on site permanently.

“Thanks to the collaborative efforts of the site

team — the dealer, NGGL and Caterpillar — we

were able to see the value in having the processes

in place to ensure the accuracy of TPMS,” says Tim

Carr, maintenance manager. “The need to regularly

validate TPMS justifies our decision to purchase

a site-owned set of scales, which will allow us to

perform regular measurements. This will help to

optimize payload and maximize production — which

will have a positive impact on our bottom line.”

mAInTEnAnCE ExPEnSES

While it’s essential to get the maximum payload

in every cycle, achieving the maximum life from

equipment and components also can increase a

site’s profitability. Scales can help in this effort, too.

“ An overloaded haul truck not only jeopardizes the truck,” says Clifton.

“ It also cuts profitability. Excess payload puts frames and structures under stress. Truck bodies, tires and components can wear out prematurely, risking failure and unplanned downtime.”

Overloaded trucks are tough on site conditions,

as well. They take a toll on haul road surfaces,

increasing site maintenance costs and reducing

the efficiency of the mobile fleet.

dETERmInIng ThE ExACT TARgET PAyLoAd

Scales are also an important tool for determining

the target payload for new truck fleets. Every truck

is rated for a specific weight and is not to exceed

that weight with the material load. However, sites

must take into consideration the weight that truck

is carrying beyond ore or overburden.

“Tires, fuel, the fire suppression system, wheel

chocks, extension ladders — even the operator and

his lunchbox — all contribute to the maximum

weight of that vehicle,” says Clifton. “What’s left is

your target payload. You have to take all those things

into consideration and scales can help you do that.”

Transcale’s Tare Weight Certification System,

developed jointly with Caterpillar, is designed to

accurately determine target payloads. Over time,

new truck body maintenance modifications will

cause the Empty Vehicle Weight (EVW) to increase,

which in turn decreases target payload. This

system can be used to determine target payload at

commissioning as well as manage target payload

during the truck life cycle.

CALCuLATIng ThE VoLumE oF mATERIAL

Once the target payload of a truck has been

determined, sites know how much the ore or

overburden loaded in the truck can weigh. However,

218 tonnes (240 tons) of coal looks a lot different

than the same weight of gold or copper.

“Transcale has an offering called volumetric

scanning, which scans the material and calculates

the volume along with weight,” says Clifton. “This

helps sites select the proper truck body or size

shovel buckets. It doesn’t make sense to get a bucket

that’s too large to fill. You want the right size bucket

and truck body for the weight of the material you’re

loading and hauling.”

The Volumetric Scanning System provides 3D

imaging to provide data on load positioning,

capacity, real-time material density and blast

fragmentation.

InSTALLIng PERmAnEnT SCALES

Recognizing the value that scales can bring to their

operation, some sites go beyond scale studies and

purchase systems that allow them to weigh trucks

as part of their normal operation.

Transcale systems can be purchased directly from

Cat dealers, and can be serviced and supported by

the dealer or by Transcale representatives. Customer

and dealer personnel can achieve certification

from Transcale to ensure proper installation and

operation of the scale system.

“Anytime managing target payloads and

maintaining payloads on a daily basis is your goal,

scale systems should be considered,” says Clifton.

“The investment in a system will quickly pay for

itself with greater machine life and a reduction in

cost per tonne. The return on investment can be

measured in months, not years.” π

ChooSIng ThE IdEAL SITE FoR A SCALES InSTALLATIon

selecting the best location for the installation of scales on a mine site should consider several factors. scale platforms should be placed where they will cause a minimum of interruption to site operations. usually, this will be where trucks can easily pull out of a haulage routine, weigh and be back into the cycle in a very short time.

the logical location may be alongside a haul road, at a fuel station, or at a dump or crusher.

for some operations, the best location is adjacent to a loading unit (shovel or wheel loader), but may require moving scales when another loading unit is observed and recorded.

When possible a laser level is an ideal tool to use for a perfectly level scale pad and approach ramp installation. consider the use of a skid steer loader to prepare, construct and maintain scale ramps for the duration of the study.

tHe ideal site sHould be:

– as open as possible

– level with good drainage

– adjacent to haul road

otHeR consideRations:

– install on firm ground

– observe overhead power lines

– Provide ample area for light vehicle parking

armstrong energy’s lewis creek mine is located in

the heart of farm country in western Kentucky. the site is at the intersection of two

coal seams, which allowed the surface operation to clear the

way for an underground one to begin. armstrong has a plan in place to ensure the land

is arable again when mining operations are finished.

8 caterpillar Global mining / Viewpoint

The mines aren’t just above ground, either. Though

they aren’t visible from the road, underground mining

machines are hard at work beneath the region’s rolling

hills. All told, the basin accounts for as much as 8 percent

of the country’s annual coal production, with mines in

Kentucky, Indiana and Southern Illinois producing nearly

91 million tonnes (100 million tons) annually.

Many companies operate in the Illinois

basin, gathering coal, petroleum and other

resources from the region. Some operate

on the surface, some underground, and

others manage multiple sites in the basin.

Armstrong Energy, founded in 2006 for

the express purpose of gathering coal in

the Illinois Basin, operates six mines

above ground and six below, as well as

three plants that prepare coal for sale.

In the rural areas of western Kentucky, USA, it’s not uncommon to turn a corner on a rural road and see a mining truck crossing the street. The Ohio River Valley area is one of the densest coal-producing regions in the United States, and the landscape is dotted with mining operations of all types and sizes.

C at® d e a l e r a n d C u s t o m e r s t r e n g t h e n

r e l at i o n s h i p i n r i C h C o a l b a s i n

Armstrong Coal

Armstrong currently controls more than 270

million tonnes (300 million tons) of proven and

probable coal reserves in western Kentucky. The coal

Armstrong produces is shipped by barge, rail and

truck to regional utilities, as well as the coal-hungry

Asian market.

mInIng A RICh CoAL SEAm

In 2010, Armstrong began operations at Lewis

Creek with a single Bucyrus-Erie 770B dragline,

the only one of its size in the United States.

Originally built in 1954, the machine was rebuilt

before it began operation at Lewis Creek (prior to

Caterpillar’s acquisition of Bucyrus International).

The dragline began removing overburden to allow a

full fleet of surface mining equipment access to the

rich No. 13 Kentucky coal seam, and continues to

remove overburden on site today.

Since then, the Lewis Creek surface mine has grown

to a full-fledged dragline operation that produces

between 82 000 and 127 000 tonnes (90,000 and

140,000 tons) per month, with more than 725 000

tonnes (800,000 tons) produced in 2012 alone. The

mine is projected to continue operation at that pace

through 2022 or 2023. However, producing coal

from the surface operation was not the only goal.

Beneath the No. 13 seam, under more than 30

meters (100 feet) of additional overburden, lies

another coal seam. Western Kentucky No. 9 is the

most heavily mined underground coal seam in the

region, and Armstrong has access to nearly 5.4

million tonnes (6 million tons) of coal at the Lewis

Creek location.

The underground mine began operation in early

2013, and is currently producing at a rate of roughly

815 000 tonnes (900,000 tons) per year. Using the

room and pillar method, the mine is currently

expected to produce for about five years.

While an underground mine would typically begin

production when a surface mine has finished

operation, Armstrong always planned to begin

mining underground as soon as the overburden

had been cleared.

“ there are many advantages in having a surface and underground mine operating in close proximity to each other,” says Kenny allen, armstrong executive vice president of operations. “there is a lot of equipment and infrastructure that can be shared between the two mines, which can save us a lot of time and money in the long run.”

The existing haul roads provide access to

the underground site, which simplifies delivery

of equipment and transportation of personnel.

Both mines also send coal to the Midway

preparation plant, which can process up to 1089

tonnes (1,200 tons) per hour of heavy or medium

coal, and has all the infrastructure and facilities

needed to load processed coal directly onto trains for

distribution.

“Having both sites operating simultaneously has

allowed us to meet a wider range of customer

needs,” says Allen.

LEVERAgIng A Long-TERm RELATIonShIP

Equipment and infrastructure aren’t the only

things shared by the surface and underground

Lewis Creek sites. Both operations also benefit

from a longstanding partnership with the territory’s

Cat® dealer, Whayne Supply.

“We have been working with Whayne since 2007,

and they’ve always been very good to work with,”

says Allen. “We have a lot of trust in their support

staff and parts distribution.”

With offices all over western Kentucky, Whayne

Supply has been providing equipment and

maintenance to Armstrong almost as long as

Armstrong has existed. In addition to a number

of pieces of surface mining equipment, including

trucks, wheel loaders, motor graders and dozers,

Whayne also provides ongoing service and support

for Armstrong’s rebuilt Bucyrus-Erie dragline. The

dealer provides rental equipment to meet specific

short-term needs.


armstrong’s coal is prepared locally and shipped by train

and by barge all over the midwest—and the rest of

the world.

1/ a belt system, driven by a cat® belt terminal Group, is constantly carrying coal up to the surface to be shipped to armstrong’s processing plant.

2/ the operator's station helps keep face hauler operators safe and productive as they haul coal from the face to the feeder breaker.

3/ a cat Roof bolter follows the operation forward and installs steel rods in the mine’s ceiling, helping prevent collapses to make the mine safer and more stable.

1 1

2

3

Cat machines make up the bulk of the production

machines on the Lewis Creek surface site. Track-

type tractors in a variety of sizes are used for

removing overburden, including a D6R, D9T, two

D10Ts and a D11T. A 992G Wheel Loader also

shares in overburden removal duties.

Whayne has made a significant investment

in supporting Armstrong and its fleet of Cat

equipment, with staff and facilities in the area

dedicated solely to Armstrong.

Whayne delivered the first fleet of 25 machines to

Armstrong’s sites before the company had even

received all necessary permits — which meant

every machine was ready to go on day one of

open mining.

Steve Ingram, an account manager with Whayne

Supply, says this initial support set the tone for a

long and successful relationship, which includes

the purchase of additional equipment as well as

ongoing support.

Armstrong currently has 70 machines covered by

Maintenance and Repair Contracts (MARCs), with

scheduled preventive maintenance and machine

rebuilds to help keep availability high.

In return, Armstrong helps Caterpillar and Whayne

with product testing. The company participated

in a field follow program for the D9T Track-Type

Tractor and then purchased the machine in 2012.

Armstrong also participated in a Tier 4 Final field

follow in July 2013.

“We may have as many as 20 technicians working

for Armstrong at a time depending on their needs,”

Ingram says. “They rely on their Cat equipment to

keep their operations running, and we’re committed

to making sure they get the performance and

reliability they expect.”

Even the dragline, which was made by Bucyrus-Erie

well before Caterpillar acquired the company in

2011, falls under Whayne’s commitment to fast and

reliable service.

“Earlier this year, Armstrong placed an order for

new rails and rollers for their 770B dragline,”

says Jeff Coomes, product support account

representative with Whayne Supply. “With

machines of that size and age, parts are made as

right: originally built in 1954, this bucyrus-erie

770b dragline was rebuilt before it began operation at

lewis creek. the machine helped access the seam

before production began, and continues to remove overburden on site today.

below: Jeff coomes of Whayne has played a

crucial part in developing the relationship between

armstrong and the dealership.




ordered, so we had projected a wait of nearly 26

weeks for the new parts.”

Unfortunately, the old rails and rollers failed

and the dragline had to be derated until the new

ones arrived. With production stalled due to the

dragline’s failure, Whayne stepped in to help

expedite the order at the factory. The new parts were

delivered four weeks early, allowing Armstrong to

get back to work sooner than anticipated.

TAkIng ThE RELATIonShIP undERgRound

The relationship that Armstrong has with the Cat

dealer was an important consideration when the

time came to start Lewis Creek’s underground

operations, even more so since the company joined

its sister company Walker Machinery to form

Whayne-Walker Underground Mining. The new

organization was created to sell and support the new

Cat products acquired from Bucyrus.

“They called us shortly after we acquired the new

underground equipment and were interested in

looking into Caterpillar as a supplier,” said Jack

Nolen, an account manager for Whayne-Walker

Underground, who had worked with Armstrong on

other mines.

While Caterpillar could be considered a newcomer

to the underground coal market, Allen says the

strong relationship with Whayne gave his company

the confidence to invest in Cat equipment.

“We were concerned about it being a new line

of equipment, obviously,” he says. “But once we

realized we’d be working directly with Whayne we

decided that it was worth looking into.”

TAkIng dELIVERy oF A ComPLETE FLEET

In the fall of 2012, Lewis Creek took delivery of the

world’s first full fleet of Cat Room and Pillar mining

equipment.

All told, Armstrong purchased two complete

sections of equipment. Lewis Creek currently runs

four CM235 Continuous Miners, eight FH110

battery-powered Face Haulers, four RB220 Roof

Bolters, two FB110 Feeder Breakers, five battery-

powered SU488L Scoops and one SU488D Diesel

Scoop. Armstrong also purchased five Cat Belt

Terminal Groups for the underground conveyor

system that carries coal to the surface.

the new cat underground mining equipment at lewis creek is the first fleet of its kind in the world. the fleet

includes continuous miners, face haulers, scoops, feeder

breakers and roof bolters. a cat belt terminal Group hauls the

coal to the surface.


In addition to the equipment itself, Whayne-Walker

Underground provides the responsive support

that Armstrong has come to rely on for its surface

equipment.

“ We have one on-site service rep at the mine every day, and we usually have another person or two staying closely tuned to the health of the equipment as well,” says nolen.

“ they work closely with the mine and other Whayne personnel to get issues resolved quickly, and because of that our availability has been excellent.”

Nolen believes the strong relationship has helped

both the dealership and customer manage the

learning process and ensure success of the first

Cat room and pillar fleets.

“This has been an evolving process since day one,

and both we and Armstrong are learning more and

more every day. Our success to this point has been

the result of a strong core of local people on both

sides who have gone above and beyond the call of

duty to ensure success — for us and our customer,”

says Nolen.

In addition to dedicated personnel both at

Lewis Creek and in its offices, Whayne-Walker

Underground has established an on-site

consignment parts store at Lewis Creek. This

allows Armstrong to have commonly used or vital

parts close at hand. Since all but the most critical

maintenance tasks are done underground, ready

availability of parts can be the difference between

a quick restart and a costly stretch of downtime.

Preventive maintenance plans are in place, as

well as scheduled rebuilds of some machines, to

maximize performance and decrease Armstrong’s

total cost of ownership.

According to Nolen, the existing relationship also

simplified the logistics involved in beginning the

new operation.

“Our parts fulfillment structure is already in place,

and we already make deliveries out there. It saved

us a lot of time setting up that network, and that in

turn put Armstrong in a better position to succeed,”

he says.

Whayne’s parts distribution network includes a fleet of mobile on-site parts storage trailers that can be packed up to follow the progress of the mine for quick and easy delivery.

With clear channels of communication and a long

history, these two organizations have successfully

added a new dimension to a successful existing

relationship.

mAnAgIng ThE ImPACT

The two companies also share a focus on

sustainability — recognizing the impact machines

and mining operations have on environments and

communities.

Armstrong is in the process of removing

overburden and coal at sites throughout Kentucky.

At Lewis Creek, above-ground reclamation is a daily

process. Once the underground site has finished

extracting coal, that area will be reclaimed as well.

“We have a strict policy on reclamation: Leave it

better than it was before,” says John Bruce, general

superintendent for surface operations. “We want to

return the land to its original state.”

This policy includes returning the land to its

approximate original contour by moving earth and

rebuilding hills. It also includes re-digging any

streams, brooks or gullies that helped to naturally

irrigate the land before Armstrong arrived.

“We want to make sure this land is capable of

sustaining the natural ecosystem that was here

before we were,” says Allen. “We have a duty to the

people who’ve trusted us with it. We want to make

sure we plant only native species, so we don’t upset

the balance of the area. And we make sure all our

reclamation efforts are sturdy enough to withstand a

hundred-year storm, so they don’t collapse the first

time the weather gets bad.”

In addition to efforts to reclaim the land it operates,

Armstrong works hard to protect the air quality

of the region. The company makes it a priority to

purchase machines that are designed to reduce

emissions as much as possible, and has

participated in test projects of equipment

that will meet the next generation of

emissions standards.

bEIng A good nEIghboR

At the same time it works to minimize its

impact on the environment, Armstrong

focuses on increasing the positive impact it

has on the communities where it operates.

For example, the Lewis Creek mines are

in Ohio County, an area that previously

experienced very high unemployment

rates. Since the mines began operation,

unemployment has been reduced, thanks in part to

177 workers employed on site, as well as the local

businesses and industries that support the mine

and its employees.

Whayne Supply and Whayne-Walker Underground

also focus on providing employment opportunities.

For example, the dealer sponsors area students

participating in Caterpillar’s ThinkBIG dealer

technician training program, and funds a

scholarship program for local residents.

Both Armstrong and the dealer are active

community members — donating time, leadership

and funding to local organizations and charities.

“ armstrong has received a lot of support from the state of Kentucky and the people who live in the communities where we work,” said allen. “We owe it to them to help improve the area in any way we can, so that we can all enjoy this beautiful land for many years to come.” π

“ We have a great long-term working relationship with Whayne,” says Rick Craig, armstrong’s vice president of operations.

“ When we have issues we can bring them to Whayne, and when they have issues they can bring them to us. It’s a partnership between us, and that’s the way it’s supposed to work.”

»

cat Global mining / Viewpoint 17caterpillar Global mining / Viewpoint 17

armstrong is committed to finding ways to leave the community better than it was before mining operations began — providing jobs to local

workers and returning mined land to its natural state.

below: John bruce oversees daily efforts to reduce armstrong’s impact on the environment in western Kentucky.


As the industry has developed more economical and

efficient methods for its recovery, natural gas has

emerged as a cheap, environmentally friendly and

abundant alternative to diesel and other fuels

in applications across a number of industries.

New methods make it possible to access reserves

that were previously either impossible or

uneconomical to recover, further driving the rise

in the use of natural gas. Though the technology

behind the large-scale collection, distribution and

use of natural gas is in its infancy, there is high

demand for advancement in the field.

Industries that demand high-horsepower engine

applications, such as mining, rail, marine and

power generation, are especially interested in this

economically and environmentally viable fuel.

For some mining operations, fuel costs alone can

account for as much as 40 percent of total operating

expenses. Many mining operations stand to save a

significant amount of money with the creation of

the technology and infrastructure necessary to fully

harness the potential of liquefied natural gas (LNG).

AdAPTIng mAChInE EngInES

Caterpillar is developing several technologies

that will allow the use of LNG-fueled engines in a

number of applications.

The first is a Dynamic Gas Blending (DGB) engine,

which mixes natural gas with air and combines with

diesel for combustion. This engine is expected to

achieve diesel replacement of around 60 percent

with comparable performance to a pure-diesel

engine. DGB allows customers to utilize diesel

or a combination of diesel and natural gas. This

flexibility offers benefits to customers in areas

where natural gas supply is not yet reliable.

The second engine under development is a High

Pressure Direct Injection (HPDI) engine, which

is targeted to the largest Cat® Mining Trucks.

HPDI injects natural gas directly into the engine,

using only a small amount of diesel as an ignition

source. Engine test cell evaluations show the HPDI

technology is capable of providing greater than 90

percent diesel substitution and lower greenhouse

gas emissions — while operating at diesel equivalent

performance.

Caterpillar anticipates that, for many parts of the

world, this will provide significant fuel savings

based on the price differential between natural gas

and diesel, as well as contribute to more sustainable

mining operations.

The primary goal of the large mining truck

LNG projects is to provide the economic and

environmental benefits of LNG without sacrificing

the performance and reliability Caterpillar

customers have come to expect from these

machines.

“Natural gas is a clean-burning, economical fuel

that is readily available to the majority of our

mining customers worldwide,” says Chris Curfman,

president of mining sales and support

for Caterpillar’s Global Mining organization.

“LNG-powered products promise to reduce our

customers’ fuel costs. We look forward to being

able to offer this option to the global mining

community.”

PIonEERIng RAIL SoLuTIonS

Caterpillar is also pioneering new LNG-based

solutions in other industries. Through its rail

subsidiaries Electro-Motive Diesel (EMD) and

Progress Rail, Caterpillar is developing both DGB

and HPDI engines for rail applications. Rail users

CAterpiLLAr AdvAnCinG tHe use oF ALternAtive FueLs in MininG AppLiCAtions

liqueFied natural gas is abundant and environmentally Friendly



stand to save a significant amount of money with even a moderate

decrease in fuel supply costs.

Billy Ainsworth, CEO of Electro-Motive Diesel, said that EMD is

proud to be part of Caterpillar’s efforts to offer alternative fuel to its

customers. “We’re not sitting idly,” he says. “We see it as a reality.”

According to Ainsworth, Caterpillar is listening closely to customers to

deliver the results they demand with their need for fuel efficiency and

reduced emissions. The company works closely with industry partners

not only to develop technology to use LNG in its machines, but also to

build the infrastructure the world needs to make full use of the fuel.

PARTnERIng In dEVELoPmEnT

In order to help make its LNG projects a reality, Caterpillar has

partnered with Westport Innovations, Inc. Westport has led the

industry in the development of natural-gas-fired engines for vehicles

of every size and application.

The agreement between Caterpillar and Westport is focused on

engines for mining trucks and locomotives, and leverages the

expertise and experience that Westport has gained through its

existing natural gas technologies.

“This is a significant opportunity that has the potential to transform

important segments of the global off-road equipment industries,” says

David Demers, CEO of Westport Innovations. “The substantial price

difference between natural gas and diesel fuel is resulting in a strong

financial incentive to enable off-road applications to take advantage

of low natural gas energy costs without sacrificing operational

performance. There is also a clear environmental incentive because

of the reduced carbon emissions.”

Mining isn’t the only industry taking advantage of natural gas

opportunities. Caterpillar sells natural gas powered gen sets of up

to 10 megawatts that are being supplied to a Mid-Kansas Electric

company within the next year. These gen sets will run on 12 natural-

gas-fired Cat generator sets.

The oil and gas group has already shipped four DGB kits to companies

in Russia and the United States. Two generators in Arkansas,

USA, helped provide the power to drill eight wells in 45 days and is

estimated to have saved more than USD$100,000 in fuel costs over

that time.

Caterpillar has also delivered two dual-fuel engines for marine use,

and is scheduled to ship marine gas generator sets before the end

of 2013.

“Our customers want this to be a reality, and we want to bring it

to them,” Ainsworth says. “We’re all in.” π

This graphic follows Lng through the entire life cycle — from collection and distribution to blending with diesel, and then on

to its application in various industries — illustrating the potential performance equivalence, cost savings and environmental

benefits that can be gained by using Lng.


saGan-nuR

russiAn CoAL Mine Continues to set produCtion reCords Credit given to skilled team

and new high-perFormanCe

maChines


On Jan. 12, 2013, Russia’s tugnuysky coal mine delivered its 100 millionth tonne (111 millionth ton) of coal — adding another chapter to the history of this nearly 30-year-old site and setting yet another record for the Russian coal mining industry.Owned by the largest hard-coal mining

company in Russia, the Tugnuysky mine is

equipped with high-performance machines

and takes advantage of the latest mining

technologies. It’s no surprise that world

drilling and stripping records were set here

in 2012.

The coal mine and the mining town of Sagan-

Nur were founded in 1984 in the area called

Olon-Shibir, which is located on the border

between Buryatia and Chita region. Officially,

the Tugnuysky coal mine was created on Jan.

1, 1989, by Order No. 75 issued by the USSR

Ministry of Coal Industry on Jan. 24, 1989.

Today, Open Joint Stock Corporation (OJCS)

Tugnuysky mine is the most promising

coal producer within Siberian Coal Energy

Company (SUEK). Tugnuysky mine was

merged into OJSC SUEK in 2001. Since then,

the coal mine had been highly modernized,

which made it possible to improve efficiency

and increase output from 5.3 million tonnes

(5.8 million tons) to 12.5 million tonnes

(13.8 million tons) of coal per year.

SETTIng RECoRdS

In addition to this year’s record-setting

production figures, the Tugnuysky coal mine

can claim several other achievements that not

only set the standard for Russia but that are

recognized world-wide.

In April 2012, Yury Yegorov’s team completed 41 806 linear meters (137,150 linear feet) of drilling.

In May 2012, a team operating a Bucyrus No.1 495 HD shovel loaded 1.7 million cubic meters (2.2 million cubic yards) of overburden to be transported by the haul truck fleet.

In September 2012, this team set a new record by loading 2.005 cubic meters (2.62 million cubic yards) of overburden.

In May 2013, the team broke its own record by loading 2.011 cubic meters (2.63 million cubic yards) of overburden.“These record-setting achievements give

the team at Tugnuysky mine a sense of joy

and pride,” says Valeriy Kuletskiy, executive

director. “They’re not just numbers; they’re

world and Russian coal mining industry

records.”

REmEmbERIng ThE PAST

The coal-bearing capacity of Cisbaikalia and

Transbaikalia, the region where Tugnuysky

is located, was first studied at the time of the

construction of the Trans-Siberian Railway. In 1926,

the first geological survey of the Tugnuy river valley

was completed. Further exploration work showed

that the Olon-Shibirskoye and Nikolskoye deposits

are rich with resources.

It wasn’t until decades later, in February 1981,

when the Minister of Coal issued an order to

construct the Tugnuysky coal mine. In 1984, in the

vast expanses of the former Soviet Union, in the

area of Olon-Shibir, the first stake was driven into

the ground where the Tugnuysky coal mine and

the mining town bearing the name of Sagan-Nur

(White Lake) would later appear.

The coal mine was put into operation in 1988,

when the first overburden was removed and the

first tonnes of coal were transported to a storage

yard. In 1992, the mine constructed an emergency

repair shop, machinery repair shop, fuel and grease

warehouse, basic explosive warehouse, and an

administration building. Also that year, the mine

commissioned a start-up facility with a capacity of

1 million tonnes (1.1 million tons) of coal per year.

In 1996, the coal mine reached the capacity of 3.8

million tonnes (4.2 million tons) per year.

In 2001, the mine delivered its 30 millionth

tonne (33 millionth ton) of coal. In the same year

the Tugnuysky coal mine merged into Siberian

Coal Energy Company (SUEK), which is when

modernization began and powerful new machines

went to work on the site.

For example, in 2009 the coal mine was equipped

with 220-tonne (243-ton) mining trucks and a coal

preparation plant was

put into service. A year

later, the mine began

operating two Bucyrus

495HD Electric Rope

Shovels with 41.3-cubic-

meter (54-cubic-yard)

buckets, as well as new

support equipment and

a drill.

Just two years later, in March 2011, the Tugnuysky

coal mine set a record by delivering 1.017 million

tonnes (1.1 million tons) of coal in one month.

Six months later in August 2011, miners reached

a new milestone by delivering 1.5 million tonnes

(1.7 million tons) of coal. On Dec. 19, 2011, the

Tugnuysky coal mine reached a new performance

level, having produced 10 million tonnes (11 million

tons) in the preceeding 12 months.

PRoduCIng bLACk goLd

The Tugnuysky coal mine uses the open-pit

mining method to develop the Olon-Shibirskoye

coal deposit. This deposit is located in Petrovsk-

Zabaykalsky rayon (county) and Mukhorshibirsky

rayon of the Republic of Buryatia. The deposit is

rich with high grade thermal coal.

An estimated 111 million tonnes (122 million tons)

of coal are recoverable from this deposit. According

to Denis Popov, the company’s chief technologist,

12 million tonnes (13 million tons) of coal are

expected to be mined per year until 2019. The

following output decline would be due to the

thinning of the primary coal bed. The company

is addressing this future decline by developing

the nearby Nikolskoye deposit while gradually

redistributing the coal production from the Olon-

Shibirskoye deposit to the Nikolskoye deposit.

The total coal output is 12 million tonnes

(13 million tons) per year, which will be enough

until 2060, considering the depletion of both

deposits. The Nikolskoye deposit is similar to

the Olon-Shibirskoye deposit and is one of the

largest coal deposits in Buryatia. The total reserves

recoverable from the Nikolskoye deposit are

estimated at 260 million tonnes (287 million tons)

of coal.

During the recent ramp-up of output at the

Tugnuysky mine, the company also built a new coal

preparation plant, where the most advanced and

efficient coal conversion technologies are now used.

The coal concentrate, which is the product of the

conversion process, is in full compliance with

export standards.

OAO Razrez Tugnuysky is one of Russia’s key

exporters of coal, with Asian and Oceanic countries,

predominantly South Korea, Taiwan and Japan,


considered to be the major buyers. In the last year,

the Tugnuysky coal mine exported 8.7 million

tonnes (9.6 million tons) of coal, strengthening

its position as one of the leading export-oriented

companies within SUEK.

FoCuSIng on SAFETy

Providing healthy and safe working conditions

for employees has always been a priority for OAO

Razrez Tugnuysky. SUEK has implemented a safety

management system with people as its core value.

The employees of SUEK are constantly trained in

safe working methods. The training facility and

work sites are equipped with monitors playing

safety and work-related instruction videos. These

videos are shown during every shift, and activities

are continually monitored. Medical check-ups are

provided both before and after shifts, and SUEK

has purchased state-of-the-art medical equipment

to help detect and treat medical conditions.

“ Without health and safety protection, it would be impossible for the company to evolve and achieve the success it has enjoyed over the years,” says Kuletskiy.

PRoTECTIng ThE EnVIRonmEnT

The Tugnuysky coal mine strives to be a responsible

user of mineral resources. “Environmental

protection is an important aspect of the mine’s

operations,” says Popov. “After all, open pit coal

mining involves transporting large quantities of

rocks and coal, which can result in damage to the

landscape and the ecology of the area.”

The Tugnuysky coal mine designed a project using

the optimal technology to return rock waste disposal

areas to the ecosystem, restoring damaged ground

for agricultural and aquicultural use. In 2012,

the company completed the mining stage of soil

remediation and covered 35 hectares (86.5 acres)

with a fertile layer of original topsoil, and this year

30 hectares (74 acres) were covered. The company

plans to increase the area being restored up to

50 hectares (123.6 acres) per year.

The mine also must comply with a number of

emissions and other environmental regulations.

In 2011, the coal mine was equipped with an

oily waste recycling installation and a household

wastewater sterilizing system. A waste treatment

facility project, ordered by SUEK in Germany, was

recently initiated. Waste treatment facilities are

being built on the above-ground premises of the

company. These facilities will be utilized to purify

rain and wastewater using the most advanced

water treatment technologies.

CARIng FoR PEoPLE

While SUEK is constantly looking for new ways

to increase its coal output, the people who work at

Tugnuysky are the company’s top priority. From

ensuring they have access to the safest and most

advanced equipment, to offering an affordable lunch

at the canteen, the company recognizes that people

are its greatest asset.

“We built new shower rooms and a laundry facility

so the workers can take a shower and have their

clothes washed after their shifts,” says Popov.

“And this is just a little everyday care provided for

the workers. The philosophy of any strong company

comes down to this: respect yourself, your business,

and your team.”

As the mine continues to be re-equipped with new

state-of-the-art, highly complex machines, SUEK

recognizes that it must invest in its people to ensure

there are skilled professionals who can work with

them. To strengthen the corporate culture and

help employees realize their professional potential,

SUEK created a corporate university, which offers

courses in developing management skills. After

training and testing, the best students join the

company’s talent pool. Various workshops are

routinely offered to managers, deputies and key

employees. The Tugnuysky coal mine provides

training courses in directorship, site supervision,

and locomotive operation.

The coal mine has its own training center, aimed

at fostering the growth of local professionals.

Training is provided with regard to the mining

development plan, understanding new machines

and technologies, meeting the needs of workshops

and sites for skills development, and helping

individuals gain new skills or be retrained.


“This management policy has helped to increase

the value of each employee and make the coal mine

safer by bringing the quality of workplace relations

to the next level,” says Kuletskiy.

InVESTIng In InFRASTRuCTuRE

The equipment used at Tugnuysky plays a key role

in the productivity achievements at the mine. In the

last several years, SUEK implemented a range of

initiatives designed to strengthen the infrastructure

of the mine and increase its capacity.

The mine went through a technological revolution,

with SUEK investing about usd$250 million in

the mine over the past several years. Nearly every

mining process has been improved. For instance,

overburden is removed by Bucyrus 495HD Electric

Rope Shovels. With just one shovel, the miners

are able to remove as much overburden per quarter

as they did in the whole year of 1995 using all

their machines. A similar comparison can be

made for nearly every machine or device being

used at the mine.

In the last year, the company has received several

new Cat® 24M Motor Graders with powerful diesel

engines; spacious, quiet cabins; and easy-to-operate

control levers. At Tugnuysky, motor graders are

used to build roads in the complex geological

conditions found at the site.

“Since the 24M graders have arrived, the haul roads

at Tugnuysky mine are absolutely world class,”

says John Bergin, mining director at Cat dealer

Vostochnaya Technica.

Since July 2013, the coal mine has received

additional next generation Cat machines: Cat 988H

Wheel Loaders, a Cat 434F Backhoe Loader, and a

Cat 621H Wheel Tractor-Scraper. These machines

are equipped with a number of advanced features,

such as automatic lubrication systems and rear

view cameras. The site has found that the machines

deliver excellent controllability and high reliability,

impressive load capacity, high fuel efficiency,

ease of maintenance, and more comfortable work

environments that improve operator performance

and reduce costs.

“Even in the most difficult environment, the

performance indicators of these machines are

excellent,” says Popov. “When we compare the

new machines and the machines that have been

used at the Tugnuysky coal mine for more than

10 years, we are able to see a giant step forward

in improving operation, performance, and ease

of maintenance — and, in most cases, reducing

operational costs.”

EnSuRIng PRoPER mAInTEnAnCE

Tugnuysky recognizes that the most effective use of

any piece of equipment, let alone heavy machinery,

is based on three factors:

• Mining equipment must comply with the

conditions in which it is used.

• Equipment must be operated and serviced by

qualified and technically competent personnel.

• All maintenance and repair schedules must be

accurately followed at all times.

Three service organizations have opened

maintenance facilities on site at the mine, including

Cat dealer Vostochnaya Technica. The facility is

equipped with all necessary equipment and staffed

with top-level maintenance professionals.

“Working closely with such companies as

Vostochnaya Technica helps the mine operate in

the optimal way and reduces downtime, which can

affect our productivity,” says Kuletskiy. “Highly

qualified technicians are able to diagnose any issues

using the tools they bring to the site, usually within

30 minutes after being called.” If it is impossible for

a technician to diagnose an issue using his/her own

resources on site, he/she contacts the service center.

While SUEK performs about half of the required

maintenance on Cat machines at Tugnuysky, the

mine relies heavily on Vostochnaya Technica’s

expertise for complex maintenance and repairs.

For example, the mine develops routine and annual

repair schedules together with the dealership.

The dealer supplies original parts and consumables

required to reduce equipment downtime, improve

the quality of service and increase availability.

The Cat dealer also communicates directly with

Caterpillar when necessary for more detailed

information on spare parts and assemblies.

“ Machines work well only if they are serviced properly,” says Kuletskiy.

“ special processes are used in order to determine if any machines have to be serviced out of schedule. and if we work together as a team, the machines never let us down.”

Kuletskiy continues: “Especially when it comes to

the shovels, the mine tracks every single minute of

time and ensures that maintenance is done during

shift changes and at other opportunities to avoid lost

production time.”

LookIng AhEAd

For the Tugnuysky coal mine, 2011 was a

breakthrough year, 2012 was a year of building on

success, and 2013 a year of moving forward.

The Tugnuysky coal mine is developing quickly.

Its mining operations have become large-scale.

The annual run-of-mine output of the coal mine is

85 million cubic meters (111 million cubic yards).

This means removing and transporting more than

180 million tonnes (198 million tons) of run-of-mine

material per year. Today, the coal preparation plant

processes more than 10 million tonnes (11 million

tons) of coal. The coal mine is developing its own

rail infrastructure, with 80 kilometers (50 miles)

of railway built to date.

As for further growth, the company started to

develop the Nikolskoye deposit in 2013. The

reserves recoverable from the Nikolskoye deposit are

estimated at about 260 million tonnes (286 million

tons) of coal. The first 250,000 tonnes (276,000 tons)

are planned to be delivered as early as 2013. It is not

improbable that a new state-of-the-art coal mine will

be built here. This means new industrial records

can be set in the very near future.

“World demand for coal is significant and is

expected to remain so,” says Kuletskiy. “The Tugnuy

miners have great prospects, and this means our

people feel confident about the future.” π


arCh Coal takes

top honors in saFety Competition

The Sufco mine in Salina, Utah, USA, operated by Arch Coal. Inc. subsidiary Canyon Fuel Company, took first place at the Four Corners Mine Rescue Competition in Farmington, New Mexico, in April 2013. Representatives from other Arch Coal mines took fourth, eighth and tenth places, as well. The competition requires teams to deal with simulated mine-site disasters to rescue survivors, using skills like mapping, organization and teamwork, as well as general mine rescue principles.

“What an outstanding performance for Sufco’s emergency responders,” said Ken May, Sufco’s general manager. “When we train and compete, we’re continuously improving our skills and furthering safety as a core value.” During 2012, Sufco’s employees also achieved a Perfect Zero, logging 750,000 employee-hours without a reportable safety incident or environmental violation.

Freeport-mCmoran reCognized For Cultural

preservationFreeport-McMoRan was recognized by the National Park Service for its long-term support in helping to preserve the Tuzigoot National Monument in Arizona, USA, during the site’s 75th anniversary celebration. Tuzigoot is a pueblo village built by the Sinagua people, who lived there until around 1400 A.D. The site continues to serve as a center for archaeological investigation and has produced many notable artifacts preserving the history and culture of the Sinagua. Freeport McMoRan has a long history of working with the National Park Service, and has been involved with the Tuzigoot area since one of its legacy companies first opened the site to archaeological excavation. The company has also been part of multiple reclamation and vegetation projects to preserve and improve the area.

“Our cooperative partnership with Freeport-McMoRan is helping to ensure that open lands, clean water and space for all life is an attainable goal for future generations,” said Kathy Davis of the National Park Service when she presented a plaque to the company.

leighton ContraCtors reCognized at indigenous business awardsLeighton Contractors was honored as the Corporate Member of the Year at the 2013 Supply Nation Connect awards in Melbourne, Australia. These awards are given to companies, governments and individuals who contribute in an important way to the growth of indigenous business. Craig Laslett, managing director of Leighton Contractors, said that the company is very proud of its commitment to growth among indigenous communities.

“Our organization-wide focus on strong leadership and advocacy for Aboriginal and Torres Strait people and their communities starts from the top with my personal commitment to enhancing the lives and opportunities for indigenous Australians,” said Laslett.

Leighton Contractors doubled its spending with Supply Nation businesses in 2012 and, according to Laslett, hoped to double that amount again in 2013.

“At Leighton Contractors we believe we have both a responsibility and opportunity to contribute to the growth and advancement of indigenous people and communities,” said Laslett. “We are proud to say we are now educating other corporations and employers on how to best implement their own indigenous community and business development programs.”

vale adopts new tools

to reduCe greenhouse gases

Vale adopted two new tools to help all of its operations understand and meet the company’s Carbon Target. The first tool is a Guide to Identifying Opportunities to Reduce Greenhouse Gases, a comprehensive look at different ways for an operation to eliminate or reduce sources of carbon emission. Vale’s goal is to reduce its 2020 forecast for greenhouse gases by 5 percent, and this guide is a crucial part of that initiative. It provides guidelines for all business areas and potential solutions

for carbon reduction, as well as examples of initiatives that have worked in the past.

The other tool is an Emissions Simulator, which allows various areas of the company to simulate emissions. It also allows Vale to test potential reduction solutions, resulting in more efficient implementation. Both initiatives were launched on Brazil’s National Climate Change Awareness Day 2013.

alCoa uses

wetlands to save water and money

Alcoa recently took part in a project in conjunction with the Saudi Arabian Mining Company (Ma’aden) to engineer wetlands that act both as a purification measure and natural habitat in Saudi Arabia.

At Ma’aden’s desert location, water preservation is even more crucial than usual, especially in the water-intensive aluminum mining industry. Traditional mechanical methods of water purification require significant human intervention and sophisticated controls, as well as significant cost. Alcoa and Ma’aden instead turned to nature to find a cost-effective, environmentally friendly way to purify water while also enriching the area around the mine.

Initially built and tested at an Alcoa facility in Pittsburgh, Pennsylvania, USA, the Ma’aden wetlands are composed of common, native grass species and act as a natural biofilter for sanitary and industrial wastewater. The natural vegetation stimulates the growth of microorganisms and facilitates natural chemical processes to remove nitrogen, metals and other impurities from the water. The wetlands are already attracting wildlife to the area, and could potentially serve as an important habitat for migratory birds.

The wetlands were built six months faster than a traditional tank system and are estimated to have saved 907 tonnes (1,000 tons) of steel. The system also reduces Ma’aden’s water demand by 7.5 million liters (2 million gallons) of water every day. The system is already being considered for other mining and industrial applications throughout Saudi Arabia.

newmont helps develop

a new generation oF problem-solversNewmont Mining Corporation helped train tomorrow’s mining industry leaders by sponsoring the 2013 Net Impact Case Competition at the University of Colorado’s Leeds School of Business. The competition charged 20 teams of four students with development of a negotiation strategy for a hypothetical mineral agreement between Newmont and a fictional country. The strategies had to demonstrate shared value for all stakeholders, including lasting social value for the community and financial returns for Newmont.

“While details of the mining project were fabricated for the purpose of the competition, the circumstances of the case closely resembled many of the issues we address in the mining industry,” explained Brooke Bacon, Newmont’s Senior Manager of Talent Management. “So it was a very true-to-life scenario that required real thinking and real solutions.”

Just prior to the semifinal round of presentations, the judges announced a new and unexpected change in circumstances that required the students to adjust their plans, testing their improvisational ability.

The first-place team received a $10,000 reward. All the students received an experience that helped prepare them to deal with similar situations as they begin their careers, in the mining industry or elsewhere in the world.

severstal awarded For development oF

entrepreneurshipRussian steel mining company Severstal was named the winner of Best Corporate Program for the Development of Social Entrepreneurship at the 2013 Welfare Impulse awards. Welfare Impulse is an all-Russian awards ceremony that rewards companies for their work in the development of local communities and entrepreneurship.

Severstal was represented by the Urban Development Agency (UDA), a non-profit joint effort between Severstal and the Mayor’s Office of the city of Cherepovets. The UDA is focused on the development of small business, including entrepreneurial efforts. It offers support to small and medium business at

every stage of development, from start-ups to established companies.

According to Alexey Egorov, Deputy General Director of Severstal, the UDA in Cherepovets created 1,200 jobs in 2012 and is devoted to further progress.

peabody mine sets the

standard For saFetyPeabody Energy’s Rawhide mine near Gillette, Wyoming, USA, recently received the Wyoming Mining Association’s Small Surface Operation Safety Award for the year 2012. This is the mine’s second straight year winning the award.

The award is given to mines that have worked at least 10,000 hours and have the lowest lost-time incident rates. In 2012, Rawhide mine employees logged more than 442,000 hours of work without a single lost-time incident, during which time they produced and shipped 13.3 million tonnes (14.7 million tons) of coal.

This is not the first, or even second, safety award the Rawhide mine has earned. It is consistently recognized for safety both within Peabody Energy and the mining industry, and recently achieved a safety milestone by working more than 640 consecutive days without a reportable incident.

However, Rawhide is not the only Peabody mine that is reaching safety milestones. The Kayenta mine in Arizona recently reached more than one million work hours without a lost-time injury; and the Bear Run mine in Indiana reached more than one million work hours without even a reportable injury.

laFarge Joins zoo to support Conservation researCh

Lafarge Canada, Inc., a division of the Lafarge Group, announced a new partnership with the Calgary Zoo and the zoo’s Center for Conservation research. By providing both a cash donation and a gift of aggregates, concrete and cement for construction, as well as employee volunteer hours, Lafarge hopes to help sustain the ecosystems around its operations.

“Lafarge has a long history of environmental leadership and has connected specifically with the Conservation Research Center to further our efforts. We have supported the zoo for over 20 years and find their research work critical to biodiversity,” said René Thibault, President and CEO of Lafarge Western Canada.

Lafarge’s support will help execute important field research on a number of animals, including black-tailed prairie dogs and black-footed ferrets in order to improve conservation efforts in their natural habitats. They are also helping with whooping crane incubation studies and international community-based conservation work.

RECognIzIng CATERPILLAR CuSTomERS ARound ThE WoRLd FoR ThEIR EFFoRTS In hEALTh, SAFETy, EnVIRonmEnT And CommunITy

MininG Better WorLd

For

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stoRies in tHis section fiRst aPPeaRed in PRess Releases and on coRPoRate Websites.


Cat® equipment on display at China’s largest coal expoThe China Coal & Mining Expo continues to grow, as does Caterpillar’s presence at this bi-annual event. The show is the largest exhibition for the coal mining industry in China and one of the largest underground mining shows in the world, attracting more than 400 exhibitors and thousands of visitors.

After making its debut in 2011, Caterpillar expanded its exhibit for this year’s show, held Oct. 22–25 in Beijing, as a demonstration of its growing commitment to China and to the country’s mining industry. The company previewed a prototype of a Cat® branded roof support that will be built in the Caterpillar Zhengzhou Ltd. Facility, which was recently renamed and is in the process of being transformed to meet Caterpillar manufacturing standards.

The Caterpillar display was divided into three areas — surface mining, underground mining and technology/interactive. At the center of the exhibit was a large media wall and stage that featured interviews and discussions with Caterpillar leaders and product experts as well as live performances by local dancers and musicians.


Caterpillar previews new el1000 shearer

At Longwall USA in June 2013, Caterpillar previewed the new EL1000, a longwall shearer built for seams from 1.6 to 3.2 m (63 to 126 in). Extending the height range of Cat shearers, this machine offers the cutting power and reliability Caterpillar customers have come to expect in a smaller package designed for maximum production in low seam heights. With this addition, the Cat® Shearer product line now offers optimal productivity from 1.6 to 7 m (63 to 275.6 in). The shearer line also offers a powerful control system for enhanced automation and communication.

sponsoring the Future oF mining

College students from around the world visited Kennedy Space Center to participate in the fourth annual NASA Lunabotics Mining Competition. More than 50 teams competed in the event, which was designed to engage students in science, technology, engineering and math by tasking them with the design and construction of a remote controlled or autonomous excavator. Caterpillar sponsored three of the teams, made up of students from the University of Illinois, Iowa State University and the Milwaukee School of Engineering. The Iowa State University team won the competition, earning a $5,000 scholarship and a personal invitation to attend an upcoming launch at the Kennedy Space Center.

new rotary drill takes Cat drilling operations to the next level

Caterpillar recently unveiled the new MD6420B Rotary Drill, the next generation of the industry-leading MD6420 family. With a bit load force of 42 000 kg (92,594 lb) and three mast length options, the drill has the flexibility to drill holes across a wide range of sizes, allowing it to excel in hard- or soft-rock applications. The MD6420B offers a number of features and systems that increase productivity and efficiency, including the new Cat undercarriage with Grease Lubricated Track (GLT) and several powertrain and mast configurations. It also can incorporate the Cat® MineStar™ Terrain capability set, leveraging cutting-edge technology to make drilling safer and more efficient.

peoria proving ground Celebrates 65 years oF produCt validation

Before Cat machines are made available to customers, they go through a rigorous validation process, much of which occurs at Cat® Proving Ground facilities around the world. The Peoria Proving Ground recently celebrated its 65th year as a part of this process. While temporary proving ground facilities were set up near the East Peoria campus as early as 1910, there was no true standalone proving ground in Peoria until the 1930s. As Caterpillar grew in terms of both production and customer demand, larger and more varied terrain was needed to validate new machines and attachments. Construction for the Peoria Proving Ground facility began, and the first test was run on June 10, 1948. The facility continues to play an important role in testing and improving Cat products today.

new 988k wheel loader announCed

In April 2013, 50 years after the first 988 rolled off the production line, Caterpillar revealed the new 988K Wheel Loader. Built to be an optimal loading tool for Cat® trucks, the 988K meets Tier 4 Final / EU Stage IV emission requirements and offers improved fuel efficiency. A number of new and improved features help increase productivity and safety while saving time on maintenance. A new Optimized Z-bar linkage adds versatility in small quarries and underground applications, reducing machine height and length while increasing dump clearance. The new operator station features expanded visualization capabilities, greater sound reduction, better climate control and a comfortable seat for maximum operator productivity. Building on the premium features of existing Cat Wheel Loader products, the 988K sets a new standard in customer value.

Caterpillar reCognized For diversity and inClusion eFForts

Caterpillar was named to the “25 Noteworthy Companies” and “Top 10 Companies for Veterans” lists by DiversityInc, an internationally recognized resource for diversity management. The members of those lists are selected for their strong performance in diversity and inclusion, both internally and externally. They also have the potential to make the following year’s “Top 50 Companies for Diversity” list.

“These are tremendous honors that reflect positively on our talented team,” said Latasha Gillespie, Caterpillar’s global diversity & inclusion director. “This is only our second year completing the full DiversityInc Top 50 survey, so we are really pleased with the progress we have made in such a short amount of time. While we are proud, we only have time to pause to celebrate this recognition. We have too much work yet ahead of us to stop now. We want all employees to experience the empowerment and success that comes from working in an inclusive culture.”

neWs CAterpiLLAr

FroM

» For more news, visit mining.cat.com


Cat® dealers Continue to take on additional equipment

Caterpillar continues to transfer the sales and support of all of its complete mining line to the Cat® dealer network. The majority of the company’s largest dealers have completed the transition or are currently in the process of acquiring portions of the Bucyrus distribution network. The transition of the remaining dealers should be completed in the next year or so.

“Our dealers are making a significant investment in terms of increasing their capacity and improving their capability to meet the immediate needs of our customers all over the world,” says Steve Wunning, Caterpillar Resource Industries Group President. “Our dealers understand the customers’ needs and can help them get the high availability, low operating costs and increased productivity they demand. Our customers will see the fruit of all the work and commitment over the next many, many years.”

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