Lesser lights on high beamTuesday, 3 June 2008WHAT do bauxite...

Lesser lights on high beamTuesday, 3 June 2008

WHAT do bauxite and mineral sands have in common? Both are bulk commodities, commonly mined in large opencut operations, and both are considered to be a bit unfashionable on the global commodities catwalk. Wally Graham reports

Although the status of these seemingly lesser lights is similar to that of a B-list socialite in comparison to A-list commodity darlings such as iron ore, the role these bulk commodities play in world markets is becoming increasingly important and should not be overlooked.

Bauxite is the common raw material from which alumina is produced, which in turn is used in the production of aluminium. Australia is the largest producer of bauxite, producing more than 40% of the world’s bauxite with Brazil, Guinea, Jamaica and India also important world-scale producers.

About 85% of all the bauxite mined worldwide is used to produce alumina, or aluminium oxide, which is a white granular material. Alumina is lighter than bauxite as the water has been removed, which means it flows more readily in processing plants than bauxite, which has a sticky, muddy consistency. Sometimes, raw bauxite is shipped overseas for processing to alumina, while in other cases it is processed near the mine.

Another 10% of mined bauxite produces a form of alumina that is used in chemical, abrasive and refractory products with the remaining 5% of bauxite used to make alternative abrasives and refractory materials plus aluminium compounds.

The Australian aluminium sector comprises five bauxite mines: the Rio Tinto Weipa and Alcan Gove mines in Queensland and the Northern Territory respectively, which rank among the highest grade deposits on the planet; plus BHP Billiton’s Boddington mine, and Alcoa’s Huntly and Willowdale mines that are all located in Western Australia. Production from these mines combines to serve seven alumina refineries, six primary aluminium smelters, 12 extrusion mills and two rolled product – sheet, plate and foil – mills.

Not all of the bauxite plays in Australia, however, are in the hands of the big companies.

Junior exploration play Bauxite Resources is also making its presence known in Western Australia with the Muchea bauxite project and the South Darling Range bauxite project in the Darling Ranges region, and the Kimberley bauxite project, which covers areas in the vicinity of the Mitchell Plateau. Cape Alumina is also preparing for an initial public offering for its bauxite project near Weipa.

There are also a number of Australian juniors, such as Ord River Resources, that are basing their bauxite seeking efforts overseas.

Mineral sands are basically old beach sands that contain concentrations of rutile, ilmenite, zircon and monazite, which are used across a range of industries, including paints for colour pigmentation, computers and electronics as well as aircraft manufacture.

In its report, Australia’s Identified Mineral Resources 2007, Geoscience Australia said data accumulated by the agency and the United States Geological Survey (USGS) showed that, “Australia has the world’s largest EDR (economic demonstrated resource) of rutile and zircon with 39 percent and 43 percent, respectively and the second largest share of the world’s ilmenite with 19 percent, behind only China which has 34 percent.”

This is quite a significant statistic given that Geoscience Australia estimates that around 17% of ilmenite, 26% of rutile and 24% of zircon EDR is unavailable for mining due to its location in areas that are in most part incorporated into national parks in Queensland and New South Wales, which basically quarantines them from any mining activity.

Western Australia is the country’s most prominent producer of mineral sands, including titanium and non-titanium minerals, producing around 13% of the world’s titanium minerals, and is also a significant supplier of synthetic rutile and titanium dioxide pigment.

Named after the Latin word meaning red, rutile is a rich source of titanium dioxide, as is its fellow mineral sand ilmenite. Titanium dioxide possesses opaque and reflective properties that make it an essential ingredient of pigmentation in paints, plastics and paper. Due to its ability to reflect UV light, titanium dioxide is also used in sunscreens.

A distinctive characteristic of ilmenite is that it is slightly magnetic, which means that magnets can be used to separate it from other minerals in mineral sands. Similar to zircon, ilmenite’s hardness also makes it useful as an abrasive.

Like zircon, ilmenite is also able to withstand extreme temperatures, and both are used in the steel industry to line blast furnaces.

Products made from zircon are resistant to corrosion and heat, which means they can be used in engines, electronics, spacecraft and the ceramics industry. They are also used in computer disk drives and in many domestic products as simple as ballpoint pens.

Monazite contains what are known as the “rare earth” elements, cerium, lanthanum and neodymium, which are used in high performance magnets and robot motors, as pigment in ceramics, for X-ray screens and fibre optics, as well as energy efficient lanthanum lamps and colour television tubes.

Monazite is also a rich source of the radioactive element thorium that is used in incandescent gas mantles and in fuel for nuclear reactors.

Iluka Resources has three new mineral sands projects in the planning stage: the Murray Basin Stage 2 project in Victoria/New South Wales; the Jacinth-Ambrosia project in the Eucla Basin in South Australia; and the Tutunup South project east of Busselton in Western Australia.

Production from the Murray Basin and Tutunup projects is expected to begin in 2009 with the Jacinta-Ambrosia project expected in 2010.

Gunson Resources has lengthened the mine life of its Coburn mineral sands project by more than 10 years with the increase of the project’s JORC-compliant ore reserves by 247%, from 124 million tonnes averaging 1.3% heavy minerals to 306Mt averaging 1.2% heavy minerals.

Last year Bemax Resources announced environmental and development approvals from New South Wales Planning Minister Frank Sartor to enable the company to expand its mineral sands mining and processing operations in the Murray Basin.

The approvals will allow Bemax to produce up to 650,000 tonnes of heavy mineral concentrate (HMC) per year from the combined Ginkgo and Snapper mining operations and process up to 650,000t of HMC per year at the Broken Hill mineral separation plant.