Hopeton Ferguson Tracy-Ann Clarke Morgan Horace Cochrane
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Transcript of Hopeton Ferguson Tracy-Ann Clarke Morgan Horace Cochrane
• To define the Supply Chain and its application to the Bauxite To define the Supply Chain and its application to the Bauxite IndustryIndustry
• Show the structure of the Supply chain and how processes are Show the structure of the Supply chain and how processes are interdependentinterdependent
• Demand and supply of NanoTech bauxiteDemand and supply of NanoTech bauxite
• Forecasting of bauxite supply and Alumina manufacturingForecasting of bauxite supply and Alumina manufacturing
• Factors that inhibit the Supply Chain and Factors that inhibit the Supply Chain and
• Recommendations for Supply Chain improvement.Recommendations for Supply Chain improvement.
Smelters
The overall production chain of aluminum is represented in The overall production chain of aluminum is represented in Figure 1 on the next slide. on the next slide.
•The chain is traditionally constituted by six steps:The chain is traditionally constituted by six steps:
1.1. - Bauxite mining- Bauxite mining
2.2. - Alumina production- Alumina production
3.3. - Aluminum electrolytic smelting- Aluminum electrolytic smelting
4.4. - Manufacturing of intermediary, semi-finished - Manufacturing of intermediary, semi-finished productsproducts
5.5. - Fabrication of end products- Fabrication of end products
6.6. - Aluminum scrap recovery- Aluminum scrap recovery
NanoTech NanoTech Bauxite Bauxite
• NanoTech started in Jamaica in 1950 with the formation of NanoTech started in Jamaica in 1950 with the formation of Nano Minerals of Jamaica, a wholly owned subsidiary of Nano Minerals of Jamaica, a wholly owned subsidiary of NanoTech. The company mined bauxite for export, with the NanoTech. The company mined bauxite for export, with the first shipment in 1953.first shipment in 1953.
• NanoTech mines bauxite and refines it into alumina before NanoTech mines bauxite and refines it into alumina before exporting the alumina from its port at Clarendon. exporting the alumina from its port at Clarendon.
NanoTech ’s NanoTech ’s HistoryHistory
•In 1962, the company began processing bauxite into alumina In 1962, the company began processing bauxite into alumina at a new refinery in Clarendon with a production capacity of at a new refinery in Clarendon with a production capacity of 500,000 metric tonnes per year (mtpy), and exporting alumina 500,000 metric tonnes per year (mtpy), and exporting alumina from its port. from its port.
•The refinery's capacity was upgraded to 1 million mtpy in The refinery's capacity was upgraded to 1 million mtpy in 1999 and then to 1.25 million mtpy in 2003. 1999 and then to 1.25 million mtpy in 2003.
•The completion of a further upgrade in March 2007 increased The completion of a further upgrade in March 2007 increased the production capacity of the refinery to 1.425 million metric the production capacity of the refinery to 1.425 million metric tonnes per year.tonnes per year.
Bauxite Manufacturing Bauxite Manufacturing ProcessProcess
• NanoTech produces smelter grade NanoTech produces smelter grade alumina from bauxite to meet an alumina from bauxite to meet an annual demand of 1.425 million annual demand of 1.425 million metric tonnes. Major raw materials metric tonnes. Major raw materials include: fuel oil, caustic soda and include: fuel oil, caustic soda and lime lime
• Bauxite is mined by the company’s Bauxite is mined by the company’s Mining Department located in the Mining Department located in the parish of Manchester parish of Manchester (approximately 20 Km from the (approximately 20 Km from the refinery)refinery)
• It is then trucked from the mine pits to the conveyor loading It is then trucked from the mine pits to the conveyor loading point where it is unloaded at a stock pile that is maintained at point where it is unloaded at a stock pile that is maintained at 300,000 tons300,000 tons
• The The bauxite is put on a rope conveyor system which is used to transport the bauxite to the railcar loading point (railhead), where an 85,000 ton stock pile is maintained
Bauxite Manufacturing Process Bauxite Manufacturing Process (cont’d)(cont’d)
• Railcars are used at this point to transport the bauxite to the Railcars are used at this point to transport the bauxite to the refineryrefinery
• At the refinery, the bauxite is stored at a 120,000 ton stock pile At the refinery, the bauxite is stored at a 120,000 ton stock pile from which the process is fed by way of a conveyor beltfrom which the process is fed by way of a conveyor belt
• Alumina is extracted from the bauxite at the refinery using the Alumina is extracted from the bauxite at the refinery using the Bayer processBayer process
• This is then stored in a 5,000 ton bin, and after which it is This is then stored in a 5,000 ton bin, and after which it is transported by railcars to the Port for shipmenttransported by railcars to the Port for shipment
• The alumina is then stored in two bins with capacities of 36,000 The alumina is then stored in two bins with capacities of 36,000 tons and 50,000 tons tons and 50,000 tons
Bauxite Manufacturing Bauxite Manufacturing Process Process (cont’d)(cont’d)
• From the bins, the alumina is loaded From the bins, the alumina is loaded unto the ships via a conveyor belt at a unto the ships via a conveyor belt at a rate of 700 tons/hrrate of 700 tons/hr
• The ships vary in capacity between The ships vary in capacity between 19,590 and 44,602 tons and are the 19,590 and 44,602 tons and are the responsibility of the customers, mainly responsibility of the customers, mainly from North Americafrom North America
• The requisite power for the refinery is The requisite power for the refinery is generated locally (on site) using bunker generated locally (on site) using bunker C oilC oil
• The oil is shipped to a port in Clarendon The oil is shipped to a port in Clarendon where it is stored in two tanks of where it is stored in two tanks of capacity 171,000 and 109,000 barrels, capacity 171,000 and 109,000 barrels, and then transported to the refinery by and then transported to the refinery by rail where it is then stored in a 80,000 rail where it is then stored in a 80,000 barrel tankbarrel tank
Bauxite Manufacturing Bauxite Manufacturing Process Process (cont’d)(cont’d)
• The Bayer process uses both The Bayer process uses both caustic soda and lime as other caustic soda and lime as other raw materials in the extraction raw materials in the extraction process process
• The caustic is shipped to port in The caustic is shipped to port in Rocky Point where it is stored in Rocky Point where it is stored in two 13,090 wet metric tones two 13,090 wet metric tones capacity tanks, and then capacity tanks, and then transported to the refinery by transported to the refinery by rail where it is then stored in a rail where it is then stored in a 2,360,000 gallon tank 2,360,000 gallon tank
• The lime is purchased from a The lime is purchased from a supplier located adjacent to the supplier located adjacent to the refinery, and is transported by refinery, and is transported by conveyor to the refinery lime conveyor to the refinery lime storage binsstorage bins
The Market ConditionsThe Market Conditions
Some of NanoTech ’s major customers are North American smelters
The corporation has been faced with many challenges in recent years and has lost 25% of its market share due to competition from China
This has lead to a surplus in the non Chinese Market, which in turn has caused a reduction on the selling price of Alumina, while the cost of raw material continue to rise.
The Market Conditions The Market Conditions (cont’d)(cont’d)
The only way to remain viable is to reduce the cost of production by increasing process efficiencies
At the moment Alumina contract price is in the region of US$350/tonne
Sometimes spot market price can be as high as $600 per tonne
NanoTech continues to remain the Alumina supplier of choice due to its proximity to the market, proximity to its own shipment port as well as the fact that the bauxite is mined locally.
Refinery Bunker C Oil
Storage
Refinery Caustic Soda
Storage
Refinery Lime
Storage
Refinery BauxiteStorage
Refinery BauxiteStorage
Port Alumina Storage
Port Alumina Storage
CustomerCustomer
Holmwood Valley MinesHolmwood
Valley Mines
North ManchesterStock Pile
North ManchesterStock Pile
De La Vega Stock Pile Railhead
De La Vega Stock Pile Railhead
Port CausticStorage
Port OilStorage
OilSupplier
CausticSupplier
LimeSupplier
MaterialMaterialCostCost
TransportationTransportationCostCost
InventorInventoryy
CostCost
TransportationTransportationCostCost
StorageStorageCostCost
TransportationTransportationCostCost
ManufacturingManufacturingCostCost
TransportationTransportationCostCost
InventoryInventoryCostCost
East ManchesterStock Pile
East ManchesterStock Pile
Raw MaterialRaw Material Finished Finished ProductProduct
East Manchester
Mines
East Manchester
Mines
North Manchester
Mines
North Manchester
Mines
Supply Chain of NanoTech Mineral of Supply Chain of NanoTech Mineral of JamaicaJamaica
Bauxite Supply ChainBauxite Supply Chain
Tram 18,000 t/d over 18 Km
Convey 3904 tons of Alumina/day
Tram 3904 tons of Alumina/day
Convey 700 tons/hrTo Ship
Convey 12,500 tons of bauxite/day
REFINERYProduce: 3904 tons of Alumina/day
ALUMINA BIN 51Capacity: 5,000 tons
ALUMINA BIN 53 & 54Capacity: 50,000 & 36,000 tons
SHIPCapacity: 19,590 – 44,602 tons
Annual Demand: 1.425 mill metric tons/yr
HOLMWOOD VALLEY BAUXITE MINE Stock Pile: 60,000 tonsDemand 6000 tpd via, 25 tonne trucks to De La Vega Rail Head Distance: 15 km
REFINERY BAUXITE STORAGEStock Pile: 120,000 tons
DE LA VEGA RAIL HEAD (DLVRH)Stock Pile > 70,000 tonnes
EAST MANCHESTER BAUXITE MINEStock Pile: 300,000 tonsDemand 6000 tpd 25 tonne trucks to DLVRHDistance: 3.2 km
NORTH MANCHESTER BAUXITE MINENORTH MANCHESTER BAUXITE MINEStock Pile: 300,000 tons. Stock Pile: 300,000 tons.
Demand 6000 t/d via 3.2 Km conveyor belt Demand 6000 t/d via 3.2 Km conveyor belt to DLVRHto DLVRH
Raw Material (Bauxite)Raw Material (Bauxite) The bauxite demand from particular mines is dependent on
the available Alumina in the bauxite as well as what is already in inventory
Other factors affecting the demand include the range of particular impurities for example:
Silica content
Calcium
Iron
Product specification, vary from customer to customer, and this is usually known at least a year in advance, and this helps to determine the demand forecast from a particular mining location.
Mining, trucking, tramming and belt conveyance is usually done 7 days per week
Service level is expected to be 100%.
North Manchester (NM) Bauxite North Manchester (NM) Bauxite Stock Pile from NM MinesStock Pile from NM Mines
• North Manchester has its own mines which supplies its North Manchester has its own mines which supplies its bauxite. bauxite.
• Delivery to the stock pile is done by approximately 25 small Delivery to the stock pile is done by approximately 25 small trucks which a 30 tonne capacity. trucks which a 30 tonne capacity.
Table Showing Bauxite Demand vs Supply at North Table Showing Bauxite Demand vs Supply at North Manchester Stock Pile for 2010Manchester Stock Pile for 2010
MONTH DEMAND DEMAND ACTUAL SUPPLYACTUAL SUPPLY VARIANCEVARIANCE
JANUARY 120,000120,000 120,000120,000 00
FEBRUARY 120,000120,000 120,000120,000 00
MARCH 120,000120,000 115,000115,000 -5,000-5,000
APRIL 120,000120,000 120,000120,000 00
MAY 120,000120,000117,500117,500 -2,500-2,500
JUNE 120,000120,000125,000125,000 5,0005,000
JULY 120,000120,000120,000120,000 00
AUGUST 120,000120,000120,000120,000 00
SEPTEMBER 180,000180,000170,000170,000 -10,000-10,000
OCTOBER 180,000180,000170,000170,000 -10,000-10,000
NOVEMBER 180,000180,000 180,000180,000 00
DECEMBER 180,000180,000 180,000180,000 00
Total Shortfall for North Manchester for the year was 27,500 tonnesTotal Shortfall for North Manchester for the year was 27,500 tonnes
East Manchester (EM) Bauxite Stock Pile East Manchester (EM) Bauxite Stock Pile from EM Minesfrom EM Mines
• East Manchester has its own mines which supplies its East Manchester has its own mines which supplies its bauxitebauxite
• Delivery to the stock pile is done by approximately 25 Delivery to the stock pile is done by approximately 25 small trucks which a 30 tonne capacitysmall trucks which a 30 tonne capacity
Table Showing Bauxite Demand vs Supply at East Manchester Table Showing Bauxite Demand vs Supply at East Manchester Stock Pile for 2010Stock Pile for 2010
MONTH ACTUAL
DEMAND
ACTUAL
SUPPLY
VARIANCE
JANUARY 100,000100,000 100,000100,000 00
FEBRUARY 100,000100,000 100,000100,000 00
MARCH 100,000100,000 100,000100,000 00
APRIL 100,000100,000 100,000100,000 00
MAY 100,000100,000 110,000110,000 10,00010,000
JUNE 100,000100,000 115,000115,000 15,00015,000
JULY 100,000100,000 112,000112,000 12,00012,000
AUGUST 100,000100,000 68,00068,000 -32,000-32,000
SEPTEMBER 120,000120,000 105,000105,000 -15,000-15,000
OCTOBER 120,000120,000 100,000100,000 -20,000-20,000
NOVEMBER 120,000120,000 110,000110,000 -10,000-10,000
DECEMBER 120,000120,000 115,000115,000 -5,000-5,000
Total shortfall for East Manchester stock pile was 92,000 tonnes.
De La Vega Rail Head Bauxite De La Vega Rail Head Bauxite Stock Pile Stock Pile
• De La Vega receives bauxite from 2 locations, North and De La Vega receives bauxite from 2 locations, North and East Manchester MinesEast Manchester Mines
• The quantities supplied is based on the type of bauxite The quantities supplied is based on the type of bauxite required by the refinery at that particular timerequired by the refinery at that particular time
Table Showing Bauxite Demand vs Supply from North Manchester Table Showing Bauxite Demand vs Supply from North Manchester Bauxite Supply to De La Vega Rail Head Stock Pile for 2010Bauxite Supply to De La Vega Rail Head Stock Pile for 2010
North Manchester (NM) Bauxite Supply to De La Vega Rail Head Stock PileNorth Manchester (NM) Bauxite Supply to De La Vega Rail Head Stock Pile
• Bauxite is transferred at a rate of 750 t/h via a 3.2 km conveyor beltBauxite is transferred at a rate of 750 t/h via a 3.2 km conveyor belt
• Delivery is done 8 hours per day for 5 days per week. Weekend delivery is only Delivery is done 8 hours per day for 5 days per week. Weekend delivery is only done whenever there is a short falldone whenever there is a short fall
MONTHMONTH DEMAND DEMAND ACTUAL ACTUAL
SUPPLYSUPPLY
VARIANCEVARIANCE
JANUARYJANUARY 120,000120,000 120,000120,000 00
FEBRUARYFEBRUARY 120,000120,000 120,000120,000 00
MARCHMARCH 120,000120,000 115,000115,000 -5,000-5,000
APRILAPRIL 120,000120,000 120,000120,000 00
MAYMAY 120,000120,000117,500117,500 -2,500-2,500
JUNEJUNE 120,000120,000125,000125,000 5,0005,000
JULYJULY 120,000120,000120,000120,000 00
AUGUSTAUGUST 120,000120,000120,000120,000 00
SEPTEMBERSEPTEMBER 180,000180,000170,000170,000 -10,000-10,000
OCTOBEROCTOBER 180,000180,000170,000170,000 -10,000-10,000
NOVEMBERNOVEMBER 180,000180,000 180,000180,000 00
DECEMBERDECEMBER 180,000180,000 180,000180,000 00
Table Showing Bauxite Demand vs Supply from East Table Showing Bauxite Demand vs Supply from East Manchester Bauxite Supply to De La Vega Rail Head Stock Manchester Bauxite Supply to De La Vega Rail Head Stock
Pile for 2010Pile for 2010
East Manchester Bauxite Supply to De La Vega Rail Head Stock Pile East Manchester Bauxite Supply to De La Vega Rail Head Stock Pile
• Bauxite is transported via 25 small trucks, each having a capacity of 30 tonnesBauxite is transported via 25 small trucks, each having a capacity of 30 tonnes
• Trucks do an average of 6 trips per day for 5 days per weekTrucks do an average of 6 trips per day for 5 days per week
MONTHMONTHDEMAND FROM DLV DEMAND FROM DLV
ACTUAL ACTUAL
SUPPLYSUPPLYVARIANCEVARIANCE
JANUARYJANUARY 90,00090,000 90,00090,000 00
FEBRUARYFEBRUARY 90,00090,000 90,00090,000 00
MARCHMARCH 90,00090,000 90,00090,000 00
APRILAPRIL 80,00080,000 80,00080,000 00
MAYMAY 80,00080,000 80,00080,000 10,00010,000
JUNEJUNE 100,000100,000 115,000115,000 15,00015,000
JULYJULY 100,000100,000 112,000112,000 12,00012,000
AUGUSTAUGUST 100,000100,000 68,00068,000 -32,000-32,000
SEPTEMBERSEPTEMBER 120,000120,000 105,000105,000 -15,000-15,000
OCTOBEROCTOBER 120,000120,000 100,000100,000 -20,000-20,000
NOVEMBERNOVEMBER 120,000120,000 110,000110,000 -10,000-10,000
DECEMBERDECEMBER 120,000120,000 115,000115,000 -5,000-5,000
Table Showing Bauxite Supply vs Demand at De La Vega Rail Table Showing Bauxite Supply vs Demand at De La Vega Rail Head for 2010Head for 2010
MONTHMONTH TOTAL DEMAND FROM TOTAL DEMAND FROM N. , E. MAN &HWVN. , E. MAN &HWV
TOTAL SUPPLY FROM TOTAL SUPPLY FROM N. , E. MAN &HWVN. , E. MAN &HWV
VARIANCEVARIANCE
JANUARYJANUARY 310,000310,000 311,400311,400 1,4001,400
FEBRUARYFEBRUARY 310,500310,500 315,000315,000 4,5004,500
MARCHMARCH 300,000300,000 305,000305,000 5,0005,000
APRILAPRIL 300,000300,000 296,000296,000 -4,000-4,000
MAYMAY 300,000300,000 298,500298,500 -1,500-1,500
JUNEJUNE 320,000320,000 312,800312,800 -7,200-7,200
JULYJULY 320,000320,000 310,000310,000 -10,000-10,000
AUGUSTAUGUST 290,000290,000280,000280,000 -10,000-10,000
SEPTEMBESEPTEMBE
RR
250,000250,000238,800238,800 -11,200-11,200
OCTOBEROCTOBER 250,000250,000230,000230,000 -20,000-20,000
NOVEMBERNOVEMBER 310,000310,000 280,000280,000 -30,000-30,000
DECEMBERDECEMBER 310,000310,000 285,000285,000 -25,000-25,000
Total shortfall for the De La Vega railhead for the year was 118,900 tonnes.Total shortfall for the De La Vega railhead for the year was 118,900 tonnes.
Refinery Bauxite Refinery Bauxite
Refinery bauxite demand is based on the forecasted Alumina demand from the North American Smelters
Bauxite safety stock is 120,000 tonnes and this represents 8 to10 days refinery use
The bauxite is transported to the refinery by rail. This is a 24 hour operation for 7 days per week.
Table showing Refinery Bauxite Demand vs Supply Table showing Refinery Bauxite Demand vs Supply for 2010for 2010
MONTHMONTH DEMANDDEMAND ACTUAL SUPPLYACTUAL SUPPLY VARIANCEVARIANCE
JANUARY 250,300250,300 250,800250,800 500500
FEBRUARY 260,628260,628 265,400265,400 4,7724,772
MARCH 260,628260,628 258,000258,000 -2,628-2,628
APRIL 284,960284,960 285,960285,960 1,0001,000
MAY 284,960284,960 292,000292,000 7,0407,040
JUNE 298,400298,400 290,450290,450 -7,950-7,950
JULY 327, 700327, 700 325,000325,000 -2,700-2,700
AUGUST 265, 292265, 292194,330194,330 -70,962-70,962
SEPTEMBER 200, 292200, 292190,000190,000 -10,292-10,292
OCTOBER 200, 292200, 292158,640158,640 -41,652-41,652
NOVEMBER 255, 628255, 628 250,400250,400 -5,228-5,228
DECEMBER 255,090255,090 258,100258,100 30103010
Total bauxite short fall for the refinery for the year was 141,412 tonnesTotal bauxite short fall for the refinery for the year was 141,412 tonnes
Transportation & Transportation & DistancesDistances
Via 3.2 km Conveyor Belt
FromFromMinesMines
ToToStock PileStock Pile KmKm
# of # of trucktruck
ss
Truck Truck CapacityCapacity
# of # of trips per trips per
daydayTonnes/dayTonnes/day
NorthNorth NorthNorth 2525 2525 3030 1010 75007500
East East EastEast 55 2525 3030 1010 75007500
FromFrom ToTo Tonnes Tonnes per hour per hour
# of # of hourshours Tonnes/dayTonnes/day
EastEastStock PileStock Pile
De La De La Vega Vega
Railhead Railhead Stock PileStock Pile
750750 88 60006000
Transportation & Transportation & Distances Distances (cont’d)(cont’d)
FromFrom ToTo KmKm# of # of trucktruck
ss
Truck Truck CapacitCapacit
yy
# of # of trips trips per per dayday
Tonnes/Tonnes/dayday
North North StockpileStockpile
De La De La Vega Vega
Railhead Railhead Stock PileStock Pile
2525 2525 3030 66 45004500
FromFrom ToTo # of # of trains trains
Tonne/ Tonne/ Train Train
# of trips # of trips per dayper day
Tonnes/Tonnes/dayday
De La De La Vega Vega
RailheadRailheadRefineryRefinery 22 23802380 77 16,66016,660
Transportation Cost per Transportation Cost per tonnetonne
FromFrom ToTo MiningMiningTransportatiTransportati
onon/tonne/km/tonne/km
Off-Off-loadinloadin
gg
On-On-LoadinLoadin
gg
InventorInventoryy
North North Stock PileStock Pile De La Vega De La Vega
RailheadRailhead N/AN/A $6$6 $5$5 $7$7 $2$2
East East stockpilestockpile De La Vega De La Vega
RailheadRailhead $440$440 $70$70 $7$7 $5$5 $3$3
North North MineMine Stock PileStock Pile $390$390 $85$85 $7$7 $7$7 $2$2
East East MineMine Stock PileStock Pile $400$400 $30$30 $7$7 $8$8 $2$2
De La De La Vega Vega
RailheadRailheadRefineryRefinery N/AN/A $45$45 $4$4 $5$5 $2$2
Table Showing Alumina Demand vs Supply for 2010Table Showing Alumina Demand vs Supply for 2010
MONTHMONTHDEMAND DEMAND
ACTUAL ACTUAL
SUPPLYSUPPLYVARIANCEVARIANCE
JANUARYJANUARY 56,00056,000 57,00057,000 10001000
FEBRUARYFEBRUARY 56,00056,000 53,60053,600 -2400-2400
MARCHMARCH 54,00054,000 54,00054,000 00
APRILAPRIL 53,00053,000 53,00053,000 00
MAYMAY 59,00059,000 59,00059,000 00
JUNEJUNE 53,00053,000 51,00051,000 -2000-2000
JULYJULY 60,00060,000 60,00060,000 00
AUGUSTAUGUST 57,00057,000 45,00045,000 -12000-12000
SEPTEMBERSEPTEMBER 55,00055,000 10,00010,000 -45000-45000
OCTOBEROCTOBER 54,000 54,000 12,00012,000 -42000-42000
NOVEMBERNOVEMBER 40,00040,000 25,00025,000 -15000-15000
DECEMBERDECEMBER 53,00053,000 28,00028,000 -25000-25000Alumina Supply and Demand Refinery Storage capacity is 5000 tonnesTrains are used to transport the Alumina to a larger storage by the shipping portPort capacity is 86,000 tonnes and this represents a approximately 3 shipments.
Transportation and Transportation and DistanceDistance
FromFrom ToTo # of # of trains trains
Tonne/Tonne/Train Train
# of trips # of trips per dayper day
Tonnes/Tonnes/dayday
RefineryRefinery PortPort 22 970970 22 38803880
FromFrom ToTo
TransportatioTransportatio
nn
/tonne/km/tonne/km
Off-Off-
loadinloadin
gg
On-On-
LoadinLoadin
gg
InventorInventor
yy
RefineryRefinery PortPort $45$45 $4$4 $5$5 $3$3
Costs per tonne
Table Showing Bauxite Use Forecast for 2011Table Showing Bauxite Use Forecast for 2011
MONTHMONTH DEMAND FORECASTDEMAND FORECAST ACTUAL SUPPLYACTUAL SUPPLY
JANUARYJANUARY 315,292315,292 328,994328,994
FEBRUARYFEBRUARY 299,628299,628
MARCHMARCH 320,400320,400
APRILAPRIL 309,960309,960
MAYMAY 297, 520297, 520
JUNEJUNE 325, 635325, 635
JULYJULY 327, 700327, 700
AUGUSTAUGUST 320, 292320, 292
SEPTEMBERSEPTEMBER 320, 292320, 292
OCTOBEROCTOBER 320, 292320, 292
NOVEMBERNOVEMBER 299, 628299, 628
DECEMBERDECEMBER 280,090280,090Bauxite forecasting is done by incorporating projected production, available alumina in the bauxite and a tonne/tonne bauxite factor.
Table Showing Alumina Forecast for 2011Table Showing Alumina Forecast for 2011
MONTHMONTH DEMAND FORECASTDEMAND FORECAST ACTUAL SUPPLYACTUAL SUPPLY
JANUARYJANUARY 64,30064,300 38,01038,010
FEBRUARYFEBRUARY 54,50054,500
MARCHMARCH 64,50064,500
APRILAPRIL 57,50057,500
MAYMAY 59,00059,000
JUNEJUNE 53, 80053, 800
JULYJULY 60,00060,000
AUGUSTAUGUST 57,00057,000
SEPTEMBERSEPTEMBER 55,00055,000
OCTOBEROCTOBER 54,00054,000
NOVEMBERNOVEMBER 4000040000
DECEMBERDECEMBER 53,00053,000
Alumina forecast is done based on the customer demand and the schedule of the ships.
Analysis of Bauxite ShortfallsAnalysis of Bauxite Shortfalls
The data shows that 2010 bauxite supply suffered a The data shows that 2010 bauxite supply suffered a severe short fall from all suppliers, The reasons for the severe short fall from all suppliers, The reasons for the shortfall are outlined below:shortfall are outlined below:
• Rains, greater than expected caused flooding of pitsRains, greater than expected caused flooding of pits
• Untimely acquisition of mining land.Untimely acquisition of mining land.
• Community demonstrations due to dusting and Community demonstrations due to dusting and demand for more work:demand for more work:
• Refinery rail equipment failure.Refinery rail equipment failure.
Table Showing Reasons for Bauxite Table Showing Reasons for Bauxite ShortfallShortfall
AreaArea Rail Rail
equip. equip. failurefailure
Off-Off-loading loading equip. equip. failurefailure
Rail Rail HeadHead
Conveyor Conveyor beltbelt
CommunitCommunityy
Land Land AcquisitioAcquisitio
nn
WeathWeatherer DemonstrDemonstr
ationsations
De La De La VegaVega
1010 55 1515 00 2525 1515 3030
East East Manchester Manchester
n/an/a 00 n/an/a 00 8585 00 1515
North North Manchester Manchester
n/an/a 00 n/an/a n/an/a 7575 55 2020
Refinery Refinery 2020 3535 4545 n/an/a n/an/a n/an/a n/an/a
Total Total 8% 10%10% 14% 0%0% 47% 5%5% 16%16%
Analysis of Bauxite Analysis of Bauxite Shortfalls Shortfalls (cont’d)(cont’d)
Analysis of Bauxite Shortfalls Analysis of Bauxite Shortfalls (cont’d)(cont’d)
• The chart indicates that 47% of the time, the reason The chart indicates that 47% of the time, the reason for the shortfall is due to community problemsfor the shortfall is due to community problems
• These community problems are demonstrations due These community problems are demonstrations due to:to:• demands for more work, demands for more work,
• dusting by haul trucks and mining operations, dusting by haul trucks and mining operations,
• The location most severely affected by this is East The location most severely affected by this is East Manchester which account for over 85% of the Manchester which account for over 85% of the community issues.community issues.
• Most mining pits were flooded and this took several Most mining pits were flooded and this took several weeks to dry out, during that time, attempts were weeks to dry out, during that time, attempts were being made to open new pitsbeing made to open new pits
• The effect of the heavy rains also impacted the The effect of the heavy rains also impacted the demand from the refinerydemand from the refinery
Analysis of Bauxite Analysis of Bauxite Shortfalls Shortfalls (cont’d)(cont’d)
•Whenever bauxite supply to the refinery is Whenever bauxite supply to the refinery is reduced by issues in any of the mines or the rail reduced by issues in any of the mines or the rail head, a cost of $50 per tonne is incurred to the head, a cost of $50 per tonne is incurred to the mining company mining company
•There is no charge whenever the refinery is the There is no charge whenever the refinery is the cause of the shortfallcause of the shortfall
• The shortfall of Alumina carries a penalty called The shortfall of Alumina carries a penalty called demurrage which is a fee incurred for each day demurrage which is a fee incurred for each day that a ship has to wait in port for the additional that a ship has to wait in port for the additional AluminaAlumina
• This fee ranges from US$10,000 per day to This fee ranges from US$10,000 per day to $20,000 per day, depending on the shipping line$20,000 per day, depending on the shipping line
• For 2010 a total of US$45,000 accounted for For 2010 a total of US$45,000 accounted for short falls due to weathershort falls due to weather
Table and Chart showing Alumina Table and Chart showing Alumina ShortfallShortfall
Process Failure
Process Equipment
Failure
Industrial action
Weather
Alumina Shortfall
50 25 5 20
0
10
20
30
40
50
60
Process Failure Process Equipment Failure Industrial action Weather
Series1
Series2
RecommendationsRecommendations
Improvements can be made to the NanoTech supply chain by Improvements can be made to the NanoTech supply chain by implementing the recommendations below: implementing the recommendations below:
• NanoTech should review and modify the NanoTech should review and modify the LONGTERM and LONGTERM and SHORT TERM mining planSHORT TERM mining plan, considering the revised , considering the revised development schedule of the North Manchester Bauxite development schedule of the North Manchester Bauxite depositsdeposits
• Complete Complete Mine Preparation plansMine Preparation plans to include timely provision to include timely provision of of monthly mine development & production schedulemonthly mine development & production schedule, weekly , weekly bauxite mining and delivery program, while updating, bauxite mining and delivery program, while updating, monitoring and reporting of all bauxite movement monitoring and reporting of all bauxite movement
• Timely acquisition of land Timely acquisition of land and issuing of mine clearances to and issuing of mine clearances to support the 2011 mine plan; Prepare and provide for all data support the 2011 mine plan; Prepare and provide for all data required for the preparation of the 2011 Land Acquisition Plan required for the preparation of the 2011 Land Acquisition Plan
• Preparation of Preparation of land acquisition plan land acquisition plan and execution aiming at and execution aiming at increasing amount of “mineable” ore ahead of mine face to 6 increasing amount of “mineable” ore ahead of mine face to 6 months or more at year endmonths or more at year end
Recommendations Recommendations (cont’d)(cont’d)
• Manage the Contractor Bauxite mining processesManage the Contractor Bauxite mining processes: Mining, : Mining, Hauling and Reclaiming to meet or exceed the customer Hauling and Reclaiming to meet or exceed the customer delivery requirement of 360,000 mt per month and quality delivery requirement of 360,000 mt per month and quality of Available Alof Available Al22OO33 - 42.2% and Reactive SiO - 42.2% and Reactive SiO22 - 1.76% - 1.76%
• Manage continuously the Manage continuously the Ropecon Ropecon (conveyor) operating (conveyor) operating system to operate near rated capacity of 1200 tonnes per system to operate near rated capacity of 1200 tonnes per hour as this system provides the least expensive bauxite hour as this system provides the least expensive bauxite and have the least community issues. As well, the impact and have the least community issues. As well, the impact of weather conditions on the conveyor system is negligible of weather conditions on the conveyor system is negligible relative to transportation by trucks or by rail.relative to transportation by trucks or by rail.
• Assist in the development and execution of at least one Assist in the development and execution of at least one (1) (1) Community Service project Community Service project in North and East in North and East Manchester area.Manchester area.
• Establish a formal community complaint process in all the Establish a formal community complaint process in all the community where we have active mine areascommunity where we have active mine areas
Recommendations Recommendations (cont’d)(cont’d)
• Assist in the implementation of the Assist in the implementation of the Daily Daily Management SystemManagement System for the Mine Departments. for the Mine Departments.
• This involves daily logging of mining parameters, and This involves daily logging of mining parameters, and issues with predetermined standards for problem issues with predetermined standards for problem solving triggers and timessolving triggers and times
• In so doing, problems are identified and solved long In so doing, problems are identified and solved long before they can become major issues. before they can become major issues.
• As well as, trends will be monitored to identify future As well as, trends will be monitored to identify future opportunities as well as potential problem areas.opportunities as well as potential problem areas.
The EndThe End
Any Questions ?Any Questions ?