Case study for New Gold New Afton Mine ISO 50001

Prism Engineering prepared this case study for BC Hydro. Read the published version here.

New Gold is a leading international gold producer. When the company hired a BC Hydro-funded Industrial Energy Manager in 2011 and officially opened New Afton mine 15km west of Kamloops, B.C. in 2012, it was an opportunity to capitalize on the foundational support provided by BC Hydro to pursue the first ISO 50001 certification at a mine in North America.

BC Hydro’s Strategic Energy Management (SEM) Program enables organizations to successfully staff and deliver a strategic approach to managing energy. ISO 50001 takes energy management to the next level with an external validation process, a focus on operations and controls and the requirement to understand and document all energy management systems.

THIS CASE STUDY:

  • explores the value of ISO 50001 to BC companies
  • compares the certification process to BC Hydro’s SEM Program
  • outlines the steps to implementation and shares results, benefits and lessons learned based on New  Afton mine’s experience

BRIEF OVERVIEW OF ISO 50001

Many organizations have made great strides in reducing energy consumption, but they are now asking  themselves whether their project-based approach to energy savings will reach their  goals. Often, the  answer is to introduce a systematic approach to managing energy, also known as an Energy Management System. Taking  a management systems approach and  establishing sound business processes are necessary for achieving continual improvement in many aspects of an organization. Energy is no different.

In summer 2011, the International Standards Organization released the ISO 50001 Energy Management System Standard which formalises energy management and  provides a global benchmark. This standard has been adopted by the Canadian Industry Program for Energy Conservation amongst other national organisations.

 

Why ISO 50001 for New Gold’s New Afton Mine?

MAKING THE BUSINESS CASE TO PURSUE ISO 50001

With gold prices dropping from $1,900 per ounce in 2011 to under $1,200 in 2015, cost reductions in production and operations are critical in the mining business. To maintain competitiveness, producers must find improvements that require minimal capital investment through innovation, creativity, and improved systems.

"Mining is energy intensive,” says  Andrew Cooper, New  Afton’s Energy Specialist. “At the  New  Afton Mine,  a one  per cent reduction in energy costs is worth hundreds of thousands of dollars a year. With low commodity prices and  increasing offshore competition, energy-efficiency improvement is one of the few  places where we find increases in profitability.” ISO certification offers value to the  company in several ways. It helps achieve the consistent cost reductions the company requires to remain competitive. From a social responsibility perspective, ISO fits well with New Gold’s corporate social responsibility program as well as the company’s Towards Sustainability Mining initiatives. Furthermore, ISO 50001 provides a vehicle  to achieve the company’s Energy Management vision: to have  energy management practiced by all employees on a day-to-day basis.

A key element of the value ISO delivered to New  Afton stemmed from  the accountability that it created. Internally, having  an outside organization verify the  site’s energy management system meant the entire team had  to sit down and  work with an auditor to assess their organization. Externally, it offered value through recognition and verification of the site’s commitment to social responsibility and sustainable mining.

Says Cooper, “ISO certification means a few things: it’s verification that we  are serious about managing energy; it’s in line with  our vision around energy management and our values at the  mine; and  in addition to assisting with cost reduction and GHG reduction, it also demonstrates a commitment to social responsibility and sustainable mining.”

CONNECTING ISO TO OTHER CORPORATE PRIORITIES

Energy-efficiency projects often result in operational performance improvements. At New  Afton, every energy-efficiency project completed has had  additional benefits for operations (production), safety and the environment. Increasing efficiency with process improvements on an ongoing basis is part of the culture of the company, so energy efficiency connects well to this focus.

“I’m always very conscientious of the fact that the primary objective of the mine is to produce copper and gold concentrate,” says Cooper. “If something’s just going to save energy and not help with production, people are going to lose interest. For example, we did a flotation blower improvement project, where we  saved a lot of energy. At the same time, we improved the operation of the circuit that increased production, the air flow to the  flotation process is smoother, and since the operators don’t have to run around and adjust valves, there’s a safety improvement. On top of that, we were able to reduce the noise of the equipment, another health and safety benefit.”

 

Comparing  BC Hydro’s SEM Program to ISO 50001

BC Hydro’s SEM Program and ISO 50001 complement each  other, with both integrating energy management into management practices. ISO then ensures these are sustained through regular external validation. Based on New Afton Mine’s experience the two energy management programs compare in the following ways.

 

Getting to ISO 50001: the  Implementation Phase

PRIOR TO ISO IMPLEMENTATION

Since the  launch of its energy management program, New  Afton has built from  the  ground up, a different approach than that taken in some companies where the mandate for energy efficiency starts at a high level and is pushed down through the organization. By starting with the operators on the  floor and  getting proof of concept, Cooper has been able  to use  initial energy project success stories to secure support from the executive team to pursue ISO 500001 certification.

IMPLEMENTING ISO

New  Afton followed five steps, many of which were in place from their SEM Program participation, to achieve ISO 50001 certification:

1. Building on previous energy management success, gained support from senior management for certification.

2. Measured energy performance:

  • Energy  Management Information System (EMIS): workshop, system design, vendor selection, set  up;
  • Process Integration (PI): server installed and  data stored in database;
  • EAC: Identified Energy  Account Centres: Milling (5), Mining  (5), Crushing and  Conveying.

3. Developed an energy policy that calls for staff commitment to continually improve energy performance.

4. Developed and implemented training and engagement plans: “When you have a 24/7 operation with different departments and  different crews, the  energy team has to spend a lot of time spreading the  word, training people and  promoting the  program.”

5. Prepared documentation: prepared for the auditor; not just program components but proof of what is being done as well.

CHALLENGES TO IMPLEMENTATION

The biggest challenge for New Afton lay in operational controls and  maintenance, and getting people to remember what is expected of them from  an energy management perspective. To tackle the  challenge, Cooper has spent countless hours talking to crews. He has daily conversations with people who want to talk about energy; this aspect of the work is constant and ongoing.

“All the interaction with the crew is important because it’s people, not systems, that manage energy,” he says. “This is how I communicate specifics of SEUs [Specific Energy Uses], the operational requirements of their department relating to energy management and how operators get to know exactly what they need to do to operate with optimal efficiency. They are not going to know that unless you get in front of them.”

With more than 152 electrical sub-meters and  five gas sub-meters, another challenge to implementing ISO was the time required to install sub-metering and ensure that each meter was communicating properly with the Energy Management Information System (EMIS).

BUILDING ON ISO 14001

New  Afton is certified to the environmental standard ISO 14001. However, as they entered the  ISO 50001 certification process, Cooper and  his Energy Team were surprised to find there isn’t as much overlap as they anticipated. ISO 50001 addresses a key energy management section in the 14001 system, but  the most similar aspect between the  two standards is the  document management and control system. That being said, Cooper points out  that, “it made an easier case for 50001 because people were already using ISO, so it wasn’t a new thing we were trying  to implement.”

INCREMENTAL VALUE PROPOSITION FOR ISO CERTIFICATION (BEYOND SEM)

The external accountability aspect of ISO 50001 helped build energy management into the New  Afton’s systems and the culture of the company. Energy is a topic discussed during daily staff huddles and Cooper was given a platform at the mine’s quarterly meetings and in the site newsletter. To maintain certification, the company also includes energy performance improvement objectives in the organization’s business planning process and uses a systematic approach to consider energy efficiency in new design or upgrades.

“[With ISO 50001] everything’s covered, even down to the operational aspects of managing energy. You have to identify each Significant Energy Use  (SEU), develop training programs for each SEU, do operator training on specifics of energy within each SEU, develop significant deviations and targets for each SEU and tell people how they need to act in case of significant deviations for each SEU.”

“The BC Hydro program is second to none; there are not many utilities that offer the support it offers,” says Cooper. “ISO 50001 may not have been possible without the energy project funding and coaching support from BC Hydro that enabled it to happen.”

 

Results and Benefits

RESULTS FROM THE ISO CERTIFICATION PROCESS

With a strong Strategic Energy Management Program in place, New  Afton Mine used the ISO 50001 certification process to reinforce good energy management practices and achieve a number of impressive results:

  • ISO certification in March 2014.
  • Energy  performance improvement initiatives implemented in 2014 yielded savings equivalent to 7.3% of 2013’s  total energy consumption.
  • The New  Afton operation was originally designed to process 11,000 tons per day (4 million tons perannum) of ore at full capacity. With the focus on energy efficiency and  process improvements, the mine has increased production to more than  5 million tons per annum - 25% above design.
  • Projects completed in 2014 include:
    • Conveyor shut  down during shift changes identified by staff.
    • Mill flotation blower control upgrade.
    • Underground compressed air compressor relocation.
    • Increase in the port size of SAG mill discharge grate.
    • Surface and mill lighting upgrades.
  • As a result of its hard work, New  Afton mine was awarded NRCan’s CIPEC Leadership Award for Energy Performance Management in May 2014.

KEY BENEFITS

The benefits of participating in the ISO certification process and having a strong Strategic Energy Management Program in place have been numerous for New  Afton.

  • The mandated regular management reviews of energy ensure that energy management remains a focus with senior management at the mine.
  • By participating in the  process, New  Afton has built a strong energy team with representatives from across the  mine.
  • Engagement of operators and  staff across the site has improved. Staff are more aware of energy management opportunities and  their role in achieving results.
  • Energy performance improvement projects have resulted in a number of spinoff health and safety benefits.
  • Energy data is used instead of run hours for some reliability-centred maintenance. Energy data shows how hard equipment is working as opposed to how long it is running for.
  • The annual checks conducted by a third party provide rigour to the  program as well as validation that “we are doing the right things.” They are also an opportunity for the  mine to reinforce and renew their commitment by maintaining their certification.
  • ISO 50001 ensures that “you can’t let up on energy management: ISO requires you to stay on top of all aspects of the program and continually improve. And that’s a good thing.”

 

Lessons Learned

HOW CAN ISO 50001 HELP OTHER BC HYDRO INDUSTRIAL SEM PARTICIPANTS ACHIEVE THEIR ENERGY MANAGEMENT GOALS?

New  Afton took the  first step with SEM, providing a strong foundation for success in energy management. Going beyond SEM to 50001 provided additional benefits. These included the additional traction gained through an external verification process, the greater structure and  systems required to achieve certification and the focus on detail in the energy management program.

Says Cooper, “You’ve got to have a vision and it has to be inspiring, even if it’s only for the person managing the project. It’s got to say what you want to achieve, where you want to get to, what it’s going to do for you and  what is the  long  term goal? As part  of our SEM Program, we put ours together into a policy and in a lot of ways it’s become what we do now. The vision is still relevant today. I saw ISO 50001 as a vehicle to achieve our vision.”

 

Looking to the Future

New  Afton will continue to promote energy management as a core  activity. They  will use  the  EMIS to make energy management visible to all levels of the  organization and to optimize energy use. A key area for improvement is to solidify the ISO 50001 systems, ensuring energy management is integrated into everyone’s work process, not dependent on a single person or department.

Finally, the success of the energy management program at New Afton will help to bring the experience to other New Gold facilities.