Mining project evaluation in Brazil

In Brazil mining is energised by a supportive economic and political environment. As South America’s leading economy, Brazil is rich in history and culture, with a combination of geography, population and economy that only a few countries such as the USA and China share. Brazil ranks among the world’s top-five producers of agricultural goods and mineral commodities. Having controlled inflation, the country has a stable political system, high employment and falling risk ratings. Foreign investments are welcomed and mining will reach US$25 billion in 2010.

SRK established an office in Brazil in 2005 and presently employs 20 professionals and 10 associates with experience in geology, mining and process engineering, and metallurgy. The fast-growing team of mathematicians and computer scientists, economists, financial analysts, and environmental specialists deals with world-class mining enterprises and with complex, integrated projects involved with iron ore, gold, copper, nickel sulfides and laterites, zinc, asbestos, and limestone for cement.

SRK is participating in several studies including geological prospecting, exploration, feasibility studies, mine planning and design, modelling and resource estimating, and mining infrastructure, including issues concerning power and water supply and the environment.

Mining in Brazil is steadily growing more complex. For example, in the iron ore industry, Brazil produced only high-grade, direct-shipping hematitic ore until the beginning of the ‘70s. As hematites are frequently accompanied by soft and rich itabirite orebodies, companies started mining this ore based on hydrogravitic methods (mainly spiral concentrators), magnetic concentrators and reverse flotation, because those methods work where all others fail. When demand for iron ore outran supply in 2003, the price rose 71%; and in 2004, 21%. This high value made mining the low-grade ores economic.

However, the concentration of low grade (CPI) ore involves extensive milling that demands great amounts of energy – a significant problem in Brazil. Another problem is the low product yield of the ore and the huge amounts of tailings CPI ores generate. This presents a difficult environmental problem since mine sites lack sufficient places to store these residues.

Many businesses are involved in acquisitions and mergers today, and SRK Brazil is participating in project evaluations and studies that require highly specialised skills in sensitive areas. As this trend continues, bringing more complex problems, SRK professionals will be well prepared to face these challenges.

Gielson Coutinho: gcoutinho@srk.com.br




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