BGC Contracting brings Boggabri and Whyalla together

BGC Contracting's new equipment at Boggabri.

The mining contractor has made two major Australian mining operations that have little in common more alike than they seem.

The Boggabri and Whyalla mining operations may not appear to have many similarities on the surface.

Boggabri, in New South Wales, is a leading coal operation in the Gunnedah region, whereas Whyalla is a multi-site iron ore complex that supplies the South Australian town’s steelworks.

There are also contrasts in the development of the operations in recent years as they have overcome different industry challenges.

Idemitsu Australia Resources’ Boggabri mine, a thermal and coking coal operation since 2006, is forecast to produce 7 million tonnes of saleable coal through to 2033 under its current plan. 

Whyalla iron ore operations, on the other hand, have experienced a long-awaited resurgence in the past year since being acquired by GFG Alliance during 2017 under the SIMEC Mining and OneSteel operations.

But Boggabri and Whyalla have some similarities, a major one being that they share the same mining services provider, BGC Contracting.

The Perth-headquartered contractor won a five-year, $700 million contract from Idemitsu to deliver mining and equipment maintenance services at Boggabri in late 2017.

BGC has been contracted at Whyalla since 2012 and has received a series of extensions in the years since, including a $720 million, five-year agreement less than two years ago.

Add to this, SIMEC Mining last year appointed BGC Contracting as Whyalla’s single supplier of mining services, a role that had previously been shared between multiple companies.

Since May last year BGC Contracting has also delivered a series of new equipment investments to both operations, driving yet another thing in common for two sites in different geographic locations.

The contractor has invested more than $45 million in equipment between the sites over the past five months as part of its contractual commitments to bolster mining operations.

BGC Contracting’s investment is led by the $20 million acquisition and commissioning of a Liebherr R 9800 excavator at Boggabri.

The 800-tonne machine was delivered to the Boggabri operation last December, becoming the largest excavator in the company’s fleet.

BGC Contracting’s mining chief operations officer Andrew Taplin says the two clients have shown great confidence in the company to introduce its unique contracting model, which has included the upgrading of machinery fleets in its project delivery.

“The operations have a different scale of equipment and geographical spread of mining operations, but the similarity is in our project delivery and contracting model,” Taplin tells Australian Mining.

“We have got the BGC Contracting model working extremely effectively at Whyalla and we have been working to replicate that at Boggabri.

“For example, we’re deploying tech enabled fleets that deliver BGC Contracting and our clients with a step up in technology to provide in-field data management and much improved reporting on machine health, while aiding maintenance scheduling requirements and operational efficiencies.”

BGC Contracting at a Whyalla iron ore site.

 

BGC Contracting has matched the increased digging power of the Liebherr excavator with two new Komatsu 930E haul trucks, taking the recent investment in equipment at Boggabri to $30 million.

At Whyalla, meanwhile, BGC Contracting has invested $15 million on larger trucks and auxiliary gear to boost its presence at the iron ore sites.

Taplin believes the investments reflect the health of BGC Contracting’s mining business, the industry and the partnership approach the company takes with its clients.

“We have been able to systematically deliver for our clients. In particular, with our safety performance and the ability to look after our people and delivering on our clients’ operational plans,” Taplin continues.

The machinery investments have also grown BGC’s relationships with original equipment manufacturers (OEMs), especially from a technology perspective.

BGC Contracting has been working with its OEMs over the past two years to adopt and deliver their proven technologies to the mines it is contracted at.

Its relationships include a long-standing alliance with Komatsu that provides opportunities to source new mining equipment and incorporate advanced technologies.

Taplin says the technology will allow the contractor to make real-time decisions in the field, and forward plan its capital equipment and maintenance requirements across Australia.

“We are putting in place technology with Komatsu to tap into the Komatsu products, such as diggers, dozers and trucks to extract data in real time and feed this into our data warehouse for analysis,” Taplin says.

“We will have smart algorithms in place, so we can process millions of data points and identify whether we have got any parameters sitting outside of normal control, which allows us to do further predictive maintenance.

“If we can have temperature and pressure data readings using the technology collated and monitored, then this provides the early warning signs that the equipment is operating outside of its parameters.”

The combination of BGC’s partnerships with mining companies and OEMs has developed what Taplin describes as a tri-party relationship.

Boggabri, again, will provide the leading example for how this has emerged for the company.

“Our client on site, Idemitsu, and the Boggabri coal team are additionally, very progressive with technology,” Taplin says.

“They are very supportive of us going down these paths, which provides good cost improvement returns especially for their organisation. We have a strong tri-party relationship between OEMs, client and BGC Contracting which creates this environment.”

BGC Contracting is hopeful the success at these operations and its development as a technology-progressive contractor will leave the company well placed to grow its order book in 2019.

Despite having Western Australian origins, BGC Contracting has become a truly national mining contractor in recent years with its wins in diversified commodities and regions.

Taplin says BGC Contracting plans to continue on this path in 2019 while pursuing a broad range of opportunities on both sides of the country.

“The strategy remains aligned with our focus for the past 12-18 months. We are still working towards growing our national footprint with a presence on the east and west coast, with good commodity diversification between iron ore, gold and coal in particular,” Taplin concludes.

This article also appears in the March edition of Australian Mining. 

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