HIGHBANK RESOURCES’ SPN QUARRY IN CANADA MOVES FORWARD.
By Mark S. Kuhar
The winter can be unforgiving in Canada, but that has not stopped one company from moving full speed ahead with an important new aggregates project.
Aggregate exploration and development company Highbank Resources Ltd., Vancouver, B.C., said that a crew at its Swamp Point North (SPN) quarry project recently returned to the site and is actively clearing snow, upgrading and maintaining roads, and logging/clearing further quarry area for stockpiles. The quarry is located on the Portland Canal, south of Stewart, in Northwest British Columbia.
“Khtada Environmental Services LP monitoring personnel were on-site recently taking samples in compliance with the site’s Mines Act Permit,” said president and CEO Victor N. Bryant. “A supply barge [loaded with] specific winter weather materials – chains for the 30-ton rock trucks, corks/spikes for the bulldozer, winter camp supplies and additional large-diameter culvert pipes for appropriate road and drainage use – was also sent.”
Bryant recently visited the SPN project with Stan Spletzer, vice president of aggregate operations, and Bill Faulhaffer, Journeyman Quarry operations manager, who will be in charge of the day-to-day operations of the quarry. Also accompanying them was a Micon International engineer to commence work on the site’s PEA study.
The SPN project crew was readying a move to the site for Feb. 1 when a significant snow event occurred. Presently, there is about 3 ft. of snow on-site.
“We can see no reason why we, as a Canadian company, are going to stop progress for snow,” Bryant said. “Additional crews are expecting to arrive to SPN to further enhance roads; excavate discharge settling ponds for the wash plant; commission the wash plant, move the jaw crusher to optimal positioning and commission the jaw crusher; install culverts for further water-runoff management; expand shoreline area for stockpiling and shipping finished aggregates; and last but not least, commission the quarry and plant to process through the first of many barge loads of aggregate for 2015 anticipated sales.”
The company has made equipment purchases that include two 35-ton Case haul trucks; a Caterpillar D8N bulldozer; a 27-ft. boat for moving personnel and supplies; a Ford 350 Truck equipped with welder, compressor and extensive tools; a cone crusher, jaw crusher and wash plant, as well as ancillary equipment, according to the company.
Highbank’s crew previously moved the wash/screening plant and cone crusher to their final operational location adjacent to the deposit. The task of moving the plant from sea level up 200 ft. through three switchbacks was quite a difficult move.
The wash plant and cone crusher, weighing approximately 80,000 lb., required careful handling. To ensure the safety of the crew and the equipment, Highbank barged in additional equipment for this move.
A specialized semi-trailer tow truck was employed to act as a brake should the plant lose its purchase on the steep slope. Further specialized air bags were employed to alleviate any offsetting forces while an excavator traveled alongside ensuring no side forces deterred progress.
The power for the plant will come from two separate generators; one to supply the wash plant and the second for the barge loading conveyor facility.
Looking at Markets
To-date the company has submitted quotes for 1 million ton of material related to pipeline construction, 600,000 tons related to harbor expansion and 600,000 tons for first phase Liquified Natural Gas (LNG) infrastructure.
With a scarcity of aggregate in Alberta, additional quotes have been submitted for rail shipments back to that province for infrastructure builds.
In addition to quotes on near-term projects, Highbank is working on securing business well into the future. Negotiations are underway to supply 2 million tons of aggregate for a pipeline project scheduled to begin construction late in 2016 or early 2017.
“Our business plan is based on existing projects,” said Bryant.
While three-quarters of Highbank’s aggregate is destined for concrete, there is also significant demand for road building and soil stabilization.
“We can run a very profitable business as is, and when LNG construction begins, that will be a bonus,” added Bryant.
Even before LNG projects get underway, a great deal of infrastructure will need to be built. A substantial increase in the region’s workforce, both during construction and operation of the pipelines and terminals, will require housing, retail, recreation and support facilities. The Port of Prince Rupert is undergoing a massive infrastructure expansion, already valued in excess of $40 billion.
Availability of transportation corridors is an extremely important factor for marketability of aggregates. The SPN mine is located on the east side of the Portland Canal fjord on tidewater. Existing year round deep-water ports are located 38 miles north at Stewart and 72 miles south at Prince Rupert. This gives Highbank a major competitive advantage with the ability to ship product by high capacity barge while most competitors are required to truck.
Commenting on its market potential, Bryant said, “In review, the company is extremely pleased with the progress we have made over the last year. We have taken an exploration project to a production ready facility; designed and obtained all necessary permits, approvals, and licenses to build and operate an oceanside aggregate quarry; raised project financing during an extremely difficult global market trend; and above all constructed a significant remote commercial barge and ship load-out facility. Overall, a huge effort for a small company, with few employees. Given the progress to date, we are excited about the potential for 2015 and subsequent years.”
Pacific Gateway Project: An Aggregate Producer’s Dream
With the recently announced $25 Billion “Pacific Gateway Transportation Strategy” designed to position British Columbia as a hub of activity, featuring a network of boats, trains, planes and automobiles all working together seamlessly to transport people and goods across B.C., Canada and the United States, and compounded by the government of Canada’s $1.3 billion expansion to the Port of Prince Rupert – including the Ridley Island rail and utility corridor, Ridley coal terminal expansion, Fairview container terminal expansion, Watson Island development, Westview’s wood pellet terminal and more – the market for Highbank’s aggregates is very promising.
In addition, Canpotex recently announced their intention to construct a potash terminal in Prince Rupert. Add to this the potential of two Liquified Natural Gas (LNG) facilities (one proposed site on Ridley Island and a second on nearby Lelu Island); and two or more LNG facilities proposed for Grassy Point (35 miles south of Highbank’s deposit), as well as gas pipelines from northeast British Columbia with nearby routes to the LNG facilities, the aggregate requirements keep growing. Also in nearby Kitimat, B.C., Canada, a $3.3 billion Rio Tinto expansion of the Alcan Smelter and the recent David Blacks, $25 Billion Refinery proposed for 25 miles north of Kitimat adds to an aggregate demand never heard of for the Pacific Northwest.
In April 2012, British Columbia’s Energy Minister Rich Coleman announced that the provincial government had received four “new major international LNG project proposals,” all in the Prince Rupert area. The construction of these massive LNG plants will require vast amounts of construction aggregates throughout their build. In October 2014, the BC Government announced the final tax and royalty structure applicable to LNG operations in the area, which appears favorably inclined to ensuring growth in the area.