OTC Arctic Mine Sea Lift and Marine Terminal Solutions G.R. Watters, PND ENGINEERS, INC. Abstract

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1 OTC Arctic Mine Sea Lift and Marine Terminal Solutions G.R. Watters, PND ENGINEERS, INC. Copyright 2011, Offshore Technology Conference This paper was prepared for presentation at the Arctic Technology Conference held in Houston, Texas, USA, 7 9 February This paper was selected for presentation by an ATC program committee following review of information contained in an abstract submitted by the author(s). Contents of the paper have not been reviewed by the Offshore Technology Conference and are subject to correction by the author(s). The material does not necessarily reflect any position of the Offshore Technology Conference, its officers, or members. Electronic reproduction, distribution, or storage of any part of this paper without the written consent of the Offshore Technology Conference is prohibited. Permission to reproduce in print is restricted to an abstract of not more than 300 words; illustrations may not be copied. The abstract must contain conspicuous acknowledgment of OTC copyright. Abstract This paper describes logistic sea lift arrangements and receiving marine terminal solutions for Newmont s Hope Bay Gold Mine Project in the Canadian Arctic. Presented in this case study are innovative design features and logistical sea lift strategies to overcome significant obstacles for a major Arctic development project. Supplying a major Arctic mine start up project in Western Nunavut in 2010 with thousands of tons of supplies and construction materials is a major challenge when there is adequate time to plan the logistics and construct a proper receiving marine terminal. Compounding this major challenge is an extremely aggressive schedule and an existing marine terminal originally designed for much smaller vessels. The project sea lift strategy included both the typical West Coast supply route and, for the first time, east coast supply routes using both the Northwest Passage and Panama Canal. This paper provides a discussion of the advantages of staging a major sea lift using the Northwest Passage that links both west and east coast seaports of the United States and Canada to the Arctic. Details are included about temporary and permanent structural improvements to an existing marine terminal to support the sea lift and how an innovative sheet pile dock design technology and advanced winter construction techniques can accelerate the completion of a remote Arctic marine terminal by one year. Introduction The Newmont sea lift of 2010 executed from eastern Canada included a 3,000 nautical mile route for the first time up the icy straights of the Northwest Passage and set a record long 11,000 nautical mile tow through the Panama Canal (see Figure 1). The sea lift circumnavigated the North America Continent and accomplished a major logistical feat to kick off to the Hope Bay Gold Mine project. The Newmont sea lift of 2010 was organized, planned and executed under a very aggressive schedule, resulting in the timely arrival of over 10,000 tons of supplies and equipment and, 17 million liters of fuel. The sea lift required the support of 14 different vessels, over 350 logistics personnel and utilized nine different ports in US and Canada on both the East and West Coasts. Final planning and design for the sea lift and the components that needed to be transported on the sea lift, did not begin in earnest until October This schedule meant only 10-months for the design, procurement and fabrication of the required project components to meet the shipping date to the Arctic. In addition to this, the existing marine facilities at the site were never designed for large capacity ocean going vessels such as the ones required for the sea lift. The time element did not allow for conventional structural upgrades and marine facilities expansion, but instead required quick turnaround band-aid type solutions that could be implemented before the sea lift arrived. Major marine structural upgrade and expansion work had to be deferred until the following year. This paper describes the record sea lift that was executed and the logistical advantages of using both West and East Coast ports and the Northwest Passage. In addition, this paper will describe the problems encountered at the existing marine facilities at

2 2 OTC Hope Bay and how they were overcome by the implementation of both detailed planning strategies and installation of phased upgrades to support the sea lift. Hope Bay Gold Mine Project Overview Figure 1: Sea Lift Route Map The Hope Bay Gold Mine Project contains North America s largest undeveloped gold resources estimated to exceed 10- million ounces. Located in western Canada s remote Kitikmeot Region of Nunavut, the project site is very remote and approximately 150 km north of the Arctic Circle. It is accessible for a brief period of 4-8 weeks during August and September via the Arctic Ocean. Air support is provided on both a short all-weather landing strip and a longer winter time landing strip on one of the many frozen lakes. In 2007, Newmont purchased, for 1.5 billion dollars from Miramar Mining Corporation, the long narrow greenstone belt gold deposit that extends from Roberts Bay in the Arctic Ocean 80 km to the south. Within the greenstone belt there are three major deposits, starting from Roberts Bay in the north and working south to include the Doris, Madrid and Boston deposits. Since the Doris deposit is only 3 km from Roberts Bay, Miramar had chosen this site to begin mining and constructed the very beginnings of mine infrastructure including a camp, airstrip and access road from an offload jetty and fuel tank located at Roberts Bay. In an effort to ramp up production at Hope Bay, Newmont made a decision to further expand the existing infrastructure and begin with an underground starter mine and mill at the Doris site. An EPCM team was selected by Newmont in the fall of 2009 and planning began immediately for the construction of the infrastructure to support the Doris starter mine project which became known as Phase1. The EPCM team met for the first time in October of 2009 at the project headquarters established in Edmonton, Alberta. At this meeting, it became very clear among the seven engineering subconsultants and multiple contractors, vendors and logistics operators, that Newmont s schedule to commission a mill by January 2013 would be very challenging and would require an extremely dedicated team. The extremely aggressive schedule meant that a large sea lift had to be organized and mobilized to the Arctic during the 2010 shipping season. This by itself was no small feat and compound this with the fact that there was very little, if any, engineering design work complete on the $200 million starter mine complex.

3 OTC Port Infrastructure Adding further complications to the 2010 sea lift was the lack of suitable port infrastructure at Hope Bay to offload the 14 different vessels and 10,000 tons of supplies within a short six week open ice schedule. The adequacy of the existing port infrastructure was questioned early at the October meeting in Edmonton. The original jetty design constructed in 2006 by Miramar, assumed the site would be supplied on a much smaller scale from the Mackenzie River system. This shallow river supply route uses low capacity shallow draft barges staged from Hay River, Northwest Territories. The jetty was designed for a three meter draft and 3,000 DWT barge, significantly smaller than the 12,000 DWT ocean going vessels with 5-8 meters of draft that would be used for this sea lift. There was no time to undergo any major upgrades that would be necessary in the few short months available. So, a project schedule was identified that included both immediate jetty repairs to support the 2010 sea lift, and other longer term upgrades that could be delayed but necessary to support the 2011 sea lift. Repairs and upgrades identified fell in two main categories; 1) Immediate needs to accommodate larger 2010 vessels; 2) Long term structural repair solution for jetty stabilization. Immediate Port Requirements. The vessels identified to support the 2010 sea lift required 5-8 meters of draft while the existing jetty was designed for three meters of draft. Moorage to support the larger vessels was also lacking and it was apparent that immediate fixes were required before the 2010 sea lift made its delivery to Roberts Bay. Under normal circumstances the range of engineered solutions that could be used are relatively standardized. Given the schedule and remote location, however, the design approach would have to draw on both the vessel operators and the marine design engineers working closely together to develop innovative and one of a kind solutions to meet the project constraints. Other constraints to potential solutions included the following: Any construction materials needed would have to be air lifted into the site in advance of the sea lift. Shipping by air to remote sites is typically 10-times more expensive than by barge so minimization of weight was very important. Air lifted materials were limited by size and payload capacity of the largest aircraft that could land at the site; the DHC-5 Buffalo. Construction equipment was limited to availability at the site and included 4-inch maximum rotary air drilling equipment. Permit constraints required that any work performed remain above Ordinary High Water. This eliminated the option of any in-water mooring anchors for vessel tie-up. Additional mooring points would need to be installed upland. Permit constraints required upland mooring points could only be accessed from Roberts Bay while it was frozen. CAMP BARGES MOORING POINT (TYPICAL) ACCESS FLOATS Figure 2: 2010 Sea Lift Offload

4 4 OTC Several alternative mooring and vessel layout schematics were reviewed and a joint solution was developed by PND and the main vessel operator, Northern Transportation Company Ltd., (see Figure 2). Spacer barges were proposed at the end of the rock jetty and would be anchored by the newly installed upland mooring points. Serving as an extension to the existing jetty, the spacer barges would work as a temporary deeper draft berth. This configuration, would allow vessels such as the NT 12000, with 5 meters of draft, to unload directly onto the jetty. The main cargo ship with a draft of 8-meters, operated by Desgangés, would have to moor in deeper water and lighter smaller loads to the jetty extension. To add an extra degree of difficulty, it was not determined until very late in May that additional moorage would be required for two floating camp barges from Horizon North. Access floats to link the floating camps directly to land would be used by personnel staying at the camp until freeze up when an ice road can be constructed to the camp. The access floats became critical to the success of the project and had to be fast tracked from manufactures that had locally stocked product. Long Term Stabilization. From the time construction was completed four years ago, the jetty has required regular maintenance. The soft underlying marine sediments have continued to consolidate causing differential settlement and instability of the outer rock slopes where the barges berth. Over time, the rock filled jetty has become more stable. However, to allow it to efficiently berth vessels and better facilitate roll-on/roll-off cargo and moorage, it was recognized that a long term fix was required. In addition, Newmont had scheduled the arrival of heavy mill modules for the 2011 sea lift. Under the current state of the jetty, a very low factor of safety was calculated under the mill modules and upgrades were recommended by PND before the 2011 sea lift. It was decided to defer the upgrades until the winter of 2011 to allow time for the required construction materials to be delivered with the 2010 sea lift. Several different alternative stabilization retrofits were reviewed and Newmont selected a unique open style cellular steel sheet pile system designed by PND (see Figure 3). This type of system has a successful track record in numerous coastal Alaska Arctic applications and has been the technology of choice for the oil companies working in the Beaufort Sea. This will be the first structure of its type constructed in the Canadian Arctic and will likely replace older, more expensive methods that have been used in the past including circular sheet pile or concrete rock filled caissons. Newmont preferred this type of sheet pile technology not only due to cost savings, but because it is readily adaptable to a variety of soil and loading conditions and can be constructed in the winter. The sheet pile technology utilized by PND uses only 2 parts and can be installed and backfilled using available mining equipment. Using the ice as a staging platform and building access roads, makes it very cost effect to haul mine waste to the dock site and use as backfill. It also has a tremendous cost advantage when compared to older technologies that are constructed during the short summer months requiring a fleet of expensive floating work vessels and marine equipment that can interfere with sea lift operations. Figure 3: PND Sheet Pile Jetty Stabilization Figure 4: Sheet Pile Stored On-site for 2011 Construction

5 OTC Sea Lift It was determined early in the planning stages that the Hope Bay starter mine would need to be divided into two sea lifts that included critical, short lead time components that could be scheduled for 2010 while longer lead time components would be scheduled for The 2010 sea lift focused mainly on underground mining supplies and equipment, and mine support surface infrastructure including camps, fuel tanks, shops and power generation. Newmont made the start of the underground mining activities at the Doris site a top priority while the mill process engineering and mill procurement schedule could proceed on a less ambitious schedule. Due to the late date that contracting proceeded for securing space for the 2010 sea lift, it was necessary to contract with multiple vessel operators that had booking space available. This made coordination and logistical arrangements extremely challenging and complex for Newmont personnel responsible for organizing the sea lift. For this reason, the larger sea lifts executed historically by major oil companies on Alaska s North Slope, have been structured to assign a majority of the coordination responsibilities to one vessel operator. In total, Newmont utilized over six different vessel operators on the 2010 sea lift. Given the aggressive schedule, the implementation of the 2010 sea lift did not proceed without problems and discussion about some the issues encountered is provided below: Problems and Solutions. The Newmont personnel in charge of the sea lift and various vessel operators were quick to identify potential problems and make the necessary adjustments that ultimately lead to some creative and innovative logistical solutions. A few examples are included below: Vessel Operators. The 2010 sea lift vessel operators were all Canada based with the exception of the fuel tanker, which was based in Sweden. Operators NTCL and Desgangés Trasarctik started from the East Coast of Canada while the other remaining operators started from the West Coast. The normal shipping routes to the western Canada Arctic almost entirely operate out of the West Coast ports in the US and Canada makes the passage around west coast of Alaska and into the Arctic Ocean via Point Barrow. Smaller supply routes with low draft barges operate up the McKenzie River system in Northwest Territories. To date, a major sea lift supply to a development project in the western Arctic from the East Coast of Canada has never been accomplished before using both the Northwest Passage and the Panama Canal. A summary of the major vessel operators and the routes the operated are provided in the following table: Table 1: Vessel Summary Vessel Operator Home Office Sea lift Routes to Hope Bay Northern Transportation Edmonton, Alberta Panama Canal Company Ltd (NTCL) West Coast Hay River Sea lift Contributions Overall coordination assistance, supplied majority of tugs and barges Desgagnés Transarctik Ste-Catherine, Quebec Northwest Passage Cargo ship Horizon North Logistics, Inc Calgary, Alberta Tuktoyaktuk Floating barge camps Sea-Link Marine Services New Westminster, British West Coast Covered barge Columbia Seaspan Marine Corporation Vancouver, British Columbia West Coast Tug assistance Vadero Shipping Ltd Strandvägen, Sweden Various Fuel tanker Long Lead Time and Priority Cargo. Longer lead times for the mining equipment and some fabricated components meant the early July 15 deadline for shipments leaving from the West Coast could not be met. Desgagnés Transarctik, however, offered the option to launch a sea lift from Montréal on August 18 which allowed an additional month of lead time. Some high priority cargo such as rig mats and fuel, on the other hand, were needed in advance of the larger West Coast sea lift and needed to arrive on site as soon as possible. The route up the Hay River operated by NTCL could arrive to the site about 10-days sooner than the West Coast route. A map is provided in Figure 5, showing the major sea lift departure ports and the components loaded at each port. Limited Fuel Storage on Site. Existing fuel storage capacity at Roberts Bay was limited to only one five million liter tank and representative about 1/5 of the total amount of fuel storage required to support construction and mine operations. Permit delays and the time required to construct additional fuel tanks on site meant the required fuel capacity would not be available for the 2010 sea lift. An alternative method of supplying fuel was proposed using temporary ice class fuel barges and allowing them to freeze in for the winter.

6 6 OTC Ice Class Fuel Barge Availability. Initially, two ice class barges available for a winter freeze in were located in the Great Lakes region. However, when Newmont marine surveyors discovered they did not meet specifications, a last minute contract had to be made. Due to lack of availability, the ice class fuel barge option had to be scrapped and replaced with the more expensive option of freezing in the Swedish tanker, Primula, with 14 million liters of fuel. Prudhoe Bay Module Transport. Surplus camp modules purchased on Alaska s North Slope were staged in Deadhorse and needed to be transported to the site. However, capacity was already booked on the normal West Coast supply routes meaning the modules could be stranded in Alaska. A plan was developed by using NTCL s three spacer barges that were going to be delivered to the site ahead of the sea lift to serve as the temporary jetty extension. Since the Hay River route was east of Point Barrow, Alaska, and did not have to wait for the typical bottle neck that can develop for West Coast traffic, NTCL brought the three spacer barges in middle of July and picked up the modules in Deadhorse. Figure 5: Major Departure Ports Conclusion The lessons learned on this sea lift are numerous and the logistical advantages of the routes utilized for this project have applications for other Arctic development projects. The Northwest Passage provides an important alternative seaway connection that allows the ability to stage sea lifts from both the East and the West Coasts to the Arctic. Sea lifts staged from the East Coast are generally shorter transit times and can be delivered later in the season while traditional West Coast transit times are generally longer but can enter the Western Arctic sooner. The McKenzie River route can provide earliest delivery dates to the western Arctic but are limited to the size of loads that can be transported on the River. As presented in this paper, late start sea lift bookings generally lead to a higher level of coordination and more complex logistical arrangements when compared to the advantage of early vessel booking with one or two operators.

7 OTC Figure 6: Hope Bay 2010 Sea Lift Offload The planning and design of Arctic marine facilities to support a sea lift should take into consideration the Arctic seaway link between both coasts and the range of ocean going vessels from operators on the East and West Coast to fully take advantage this link has to offer. The sheet pile dock design technology presented in this paper is well suited for Arctic conditions and can efficiently accommodate any of the vessels used from both coasts. A major strategic advantage can be gained by utilizing this dock technology because winter construction methods will allow completion of a major marine facility in the same year a sea lift is launched saving one-year. Older marine terminal methods require more expensive floating marine construction equipment that require ice-free conditions and delay the launching of major sea lift by at least one-year.