IC 8977 Bureau of Mines Information Circular/1984 Chromium Availability— Market Economy Countries A Minerals Availability Program Appraisal By P. R. Thomas and E. H. Boyle, Jr. UNITED STATES DEPARTMENT OF THE INTERIOR Information Circular 8977 Chromium Availability— Market Economy Countries A Minerals Availability Program Appraisal By P. R. Thomas and E. H. Boyle, Jr. >" UNITED STATES DEPARTMENT OF THE INTERIOR William P. Clark, Secretary BUREAU OF MINES Robert C. Norton, Director As the Nation's principal conservation agency, the Deportment of the Interior has responsibility for most of our nationally owned public lands and natural resources. This includes fostering the wisest use of our land and water re- sources, protecting our fish and wildlife, preserving the environmental and cultural values of our national parks and historical places, and providing for the enjoyment of life through outdow recreation. The Department assesses our energy and mineral resources and works to assure that their development is in the best interests of all our people. The Department also has a major re- sponsibility for American Indian reservation communities and for people who live in Island Territories under U.S. administration. Library of Congress Cataloging in Publication Data: Thomas, Paul R Chromium availability— market economy countries. (Information circular ; 8977) Bibliography: Supt. of Docs. no.:. I 28.27:8977. 1. Chromium ores. 2. Chromium industry. I. Boyle, Edward H, II. Title. III. Series: Information circular (United States. Bureau of Mines) ; 8977. TN295.U4 [TN490.C4] 622s [553.4'64] 83-600309 For sale by the Superintendent of Documents, U.S. Government Printing Office Washington, D.C. 20402 PREFACE The purpose of the Bureau of Mines Minerals Availability Program is to assess the worldwide availability of nonfuel minerals. The program identifies, collects, compiles, and evaluates information on active, developed, and explored mines and deposits, and mineral processing plants worldwide. Objectives are to classify domestic and foreign resources, to identify by cost evaluation resources that are reserves, and to prepare analyses of mineral availabilities. This report is part of a continuing series of Minerals Availability Program reports to analyze the availability of minerals from domestic and foreign sources and the factors that affect availability. Questions about the program should be addressed to: Chief, Division of Minerals Availability, Bureau of Mines, 2401 E Street, N.W., Washington, D.C. 20W1. CONTENTS Page Preface iii Abstract 1 Introduction 2 Commodity overview 3 Methodology of analysis 5 The U.S. perspective 6 Summary 8 Chromium resources 8 Comparative chromite availability 10 Comparative high-carbon ferrochromium availability 13 Grade-A, high-carbon ferrochromium 13 Grade-B, high-carbon ferrochromium 15 Grade-C, high-carbon ferrochromium 16 The Republic of South Africa 17 Geology and resources 17 Mining and beneficiation 22 Chromite availability 23 High-carbon ferrochromium availability 25 Summary 27 Zimbabwe 28 Geology and resources 28 Great Dyke seam deposits 28 Selukwe podif orm deposits 32 Belingwe podiform deposits 35 Eluvial chromite deposits 35 Mining 36 Great Dyke seam deposit mining — resue mining 36 Podiform deposits (sublevel stoping) 38 Eluvial soil deposit (level and hillside stripping) 39 Beneficiation 39 Great Dyke seam deposits 39 Podiform deposits 40 Eluvial deposits 41 Chromite availability 41 High-carbon ferrochromium availability 43 Constraints to development 46 Transportation and porting facilities 46 Power supplies 46 The Minerals Marketing Corp, of Zimbabwe . 47 Summary 48 Turkey 49 Geology and resources 49 Mining and beneficiation 51 Chromite availability 52 High-carbon ferrochromium availability 53 Summary 54 Page The Philippines 54 Geology and resources 54 Mining and beneficiation 57 Surface mining 58 Underground mining 59 General operational problems 60 Beneficiation 60 Chromite availability 61 High-carbon ferrochromium availability .... 62 Summary 63 India 64 Geology and resources 64 Mining and beneficiation 65 Chromite availability 66 High-carbon ferrochromium availability ... 68 Summary 69 Brazil 69 Geology and resources 69 Mining and beneficiation 71 Pedrinhas operation 71 Limoeira operation 71 Underground mining potential 72 Chromite availability 72 High-carbon ferrochromium availability ... 72 Summary 73 Finland 74 Geology and resources 74 Mining and beneficiation 75 Chromite availability 75 High-carbon ferrochromium availability 75 Summary 76 New Caledonia 76 Geology and resources 76 Mining and beneficiation 77 Chromite availability 77 High-carbon ferrochromium availability 77 Summary 78 Greece 78 Geology and resources 78 Mining and beneficiation 79 High-carbon ferrochromium availability 80 Summary 81 Madagascar 81 Geology and resources 81 Mining and beneficiation 83 Chromite availability 84 High-carbon ferrochromium availability ... 84 Summary 85 References 85 ILLUSTRATIONS 1. Relationship between Cr:Fe ratio of chromite ores and chromium contained within a ferroalloy product 4 2. Classification of mineral resources 5 3. Chromite import market shares by country 7 4. Ferrochromium import market shares by country 8 5. Relationship of cost-evaluated tonnage to an estimate of the total demonstrated and identified resource levels within the 10 nations under study 10 CONTENTS — Continued ILLUSTRATIONS— Continued Page 6. Percentage distribution, by country, of total cost-evaluated in situ tonnage and total chromite product availability 11 7. Cost and potential availability estimates of grade-A,high-C ferrochromium 13 8. Percentage contribution, by country, to total high-C ferrochromium availability estimates by product grades A, B, and C 14 9. Cost and potential availability estimates of grade B, high-C ferrochromium 15 10. Cost and potential availability estimates of grade C high-C ferrochromium 16 11. Location of South African chromite mining areas, smelting facilities, railway network, and ports of exportation 18 12. Summary of South African cost-evaluated in situ tonnage; percent of total potential, seam distribution, chromite composition, and chromite product availability 21 13. Mining, milling, and transportation costs, FOB Durban, and availability of chromite from selected South African operations 24 14. Cost and potential availability estimates of high-C ferrochromium from selected South African chro- mite operations 27 15. Location of chromite mining areas, smelting facilities, and transportation network, Zimbabwe 29 16. Composition of cost-evaluated Great Dyke seam material and its relationship to total potential in situ tonnage 32 17. Location of chromite ore bodies and mining operations, Selukwe Podiform District in Zimbabwe 33 18. Distribution of demonstrated resource level, by type of occurrence, in Zimbabwe 36 19. Percentage distribution between mining, milling, and transportation cost estimates (FOB Beira, Mo- zambique) for podiform, seam-type, and eluival chromite deposits, respectively, in Zimbabwe .... 43 20. Mining, milling, and transportation cost estimates (FOB Beira, Mozambique), and potential avail- ability of chromite from selected operations in Zimbabwe 44 21. Cost and potential availability estimates of high-C ferrochromium from selected chromite operations in Zimbabwe 45 22. The effect of a 15-pct MMC sales commission upon the breakeven cost level estimates of high-C ferro- chromium production in Zimbabwe 48 23. Location of basic-ultrabasic rock distribution, chromite mines, ferrochromium smelters, and ports of exportation in Turkey 49 24. Ophiolite belts, low- and high-grade metallurgical- and refractory-grade chromite deposits-operations in the Philippines 55 25. Location of chromite deposits-operations and the proposed ferrochromium smelter in the Philippines . 56 26. Estimated mining, milling, and transportation costs per ton of chromite product, and availability of chromite from selected operations in the Philippines 61 27. Composition of cost-evaluated in situ demonstrated resource and percentage of total chromite potential attributable to low- and high-grade metallurgical resources in the Philippines 63 28. Distribution of potential high-carbon ferrochromium availability estimates, by ferrochromium product grade, from the Philippines 64 29. Percentage distribution between mining, milling, and transportation cost estimates (FOB port) for high- and low-grade metallurgical resources, respectively, in the Philippines 64 30. Location of selected chromite mines and mining districts, current and proposed ferrochromium smel- ters, transportation network, and ports of exportation in India 67 31. Location of selected chromite mining operations; transportation network, ferrochromium smelter, and attendant port facility, Brazil 70 32. Location of Kemi chromite mine, transportation network, smelting and port facilities, Finland 74 33. Location of Tiebaghi chromite mine, New Caledonia 77 34. Location of ophiolite complexes, Xerolivado chromite mine, and ferrochromium smelter, Greece 78 35. Location of chromite districts, transportation network, and ports of exportation in Madagascar 82 TABLES 1. U.S. ferrochromium market data, high- and low-C ferrochromium, 1970-82 7 2. Name, status, and resource type of the 80 operations comprising the cost-evaluated demonstrated re- source level, as of January 1981 9 3. Summary of cost-evaluated in situ chromium-bearing resources 10 4. Other chromite resources, market economy countries 11 CONTENTS — Continued TABLES — Continued Page 5. Total chromite product availability and weighted-average mining, beneficiation, and transportation costs, by country 11 6. Chromite transportation cost estimates from mines to ports within various countries 12 7. Projected utilization of chromite products at highest expected production level 13 8. High-C ferrochromium ; cost ranges per pound of contained chromium, availability estimates, and percentage distribution, by country 14 9. General characteristics of upper, middle, and lower group chromite seams in South Africa 18 10. Estimated in situ chromite resource data for selected South African operations as of 1980 19 11. Criteria for determination of demonstrated chromite resource estimates for selected South African operations 20 12. Most common routes, transport modes, approximate distances, and costs from the four chromite-produc- ing areas in South Africa 24 13. Current South African ferrochromium smelters and estimated 1980 capacity for the production of high- and low-C ferrochromium and ferrosilicon chromium 25 14. Weighted-average cost estimates per pound of contained chromium for the production of high-C ferro- chromium from South African chromite resources, the United States versus South Africa 26 15. Breakeven cost level estimates of ferrochromium production from South African-based chromite re- sources 27 16. Great Dyke chromite seam characteristics 30 17. Estimated in situ chromite resource data for selected Great Dyke, Zimbabwe, seam deposits as of 1980 31 18. Ore bodies, ore type, and analysis of crude ore composition, Selukwe District operations-properties, Zimbabwe 34 19. Estimated in situ chromite resource data for selected Selukwe district podiform deposits of Zimbabwe, as of 1980 34 20. Summary: in situ demonstrated and identified resources of chromite in Zimbabwe, by type of deposit 36 21. Capital and operating cost estimates, generic mining models of Great Dyke seam mines 38 22. Comparison of mining cost differences due to changes in seam thickness 38 23. Estimated beneficiation methods, recoveries, and operating costs, by category of Great Dyke seam .... 40 24. Estimated annual capacities of crude ore and chromite products from selected Zimbabwe chromite oper- ations 42 25. Weighted-average mining, beneficiation, and transportation cost estimates, per ton of product, for selected chromite operations in Zimbabwe 43 26. Ferrochromium smelters, capacities, and products, Zimbabwe 44 27. Average total cost ranges per pound of contained chromium and corresponding ferrochromium avail- ability, by resource type, for Zimbabwe 45 28. Weighted-average breakeven cost estimates per pound of contained chromium in Zimbabwe, with and without a 15-pct MMC sales commission 47 29. Comparison of weighted-average production costs per pound of contained chromium at the breakeven level in South Africa versus Zimbabwe with the imposition of a 15-pct sales commission 48 30. Chromite reserves of Turkey, 1972 Turkish government estimates 50 31. Estimated in situ chromite resource data for selected Turkish operations as of 1980 50 32. Distribution of chromite deposits or occurrences in the Philippines 54 33. Estimated in situ chromite resource data for selected Philippine deposits and operations, as of 1980 . 57 34. Surface mining data for selected Philippine chromite operations 57 35. Percentage breakdown of total estimated surface mining capital investment required for developing Philippine chromite deposits , 59 36. Underground mining data for selected Philippine chromite operations 59 37. Technical data on beneficiation of Philippine chromite 60 38. Estimated mining, milling, and transportation costs per ton of chromite product and total chromite product availability, by resource type, for the Philippines 61 39. Per pound of contained chromium cost and potential availability estimates, by ferrochromium product grade, for the Philippines 62 40. Estimated in situ chromite resource data for selected Indian deposits, operations, and districts as of 1980 65 41. Estimated mining data as evaluated in this study, India 66 42. Estimated in situ chromite resource data for selected Brazilian deposits and operations, as of 1980 ... 70 43. Estimated in situ chromite resource data for selected deposits and districts in Madagascar, as of 1980 . 82 UNIT OF MEASURE ABBREVIATIONS USED IN THIS REPORT "C degree Celsius m/yr meter per year cm centimeter mm millimeter d/yr day per year pet percent DWT deadweight ton ppm part per million op degree Fahrenheit sq km square kilometer ha hectare 103 t thousand metric tons km kilometer t metric ton kW kilowatt t/cu m metric ton per cubic n kW-h kilowatt hour tpd metric ton per day MVA megavolt ampere tpy metric ton per year m meter yr year CHROMIUM AVAILABILITY- MARKET ECONOMY COUNTRIES A MINERALS AVAILABILITY PROGRAM APPRAISAL By P. R. Thomas' and E. H. Boyle, Jr.^ ABSTRACT The Bureau of Mines determined the costs associated with the production of chromium, in the form of chromite and high-carbon ferrochomium, from the dem- onstated resources of 10 market economy nations. The analyses evaluated the relative geologic and economic position of these chromite resources contained with- in 80 producing or potential mining operations. This report presents cost evaluations of a demonstrated resource of chromite, contained within the nations studied, of appoximately 1.2 billion metric tons (t). Of this total, 70 pet is contained within the southern African nations of Zimbab- we and the Republic of South Africa. The majority of current chromium mining and smelting capacity is contained within these two countries as well. India and the Philippines have recently demonstrated greatly increased chromite resources and hold the most promise for expanding both chomite and ferrochromium pro- duction outside southern Africa. Their demonstrated resources represent approxi- mately 7 and 16 pet, respectively, of the cost evaluated total tonnage. Chromite resources, on an identified or hypothetical basis worldwide, are highly concentrated within Zimbabwe and South Africa, with these two nations contain- ing in excess of 95 pet of the total. Given the present market structure, a majority of chromium contained within the demonstrated chromite resources of the nations studied is economically re- coverable ; but from a long-term resource and economic perspective, South Africa should inceasingly dominate the markets for both chromite and high-carbon fer- rochromium. In addition, it is anticipated that an increasing percentage of chro- mium traded on the world market in the future will be in the form of high-carbon ferrochromium as opposed to chromite, as this additional processing stage con- tinues to relocate from the industrial nations that account for a majority of chromium consumption to those nations that mine chromite. 1 Economist. ' Geologist. Minerals AvailabUlty Field Office, Bureau of Mines, Denver, CO. INTRODUCTION This study addresses the international availability of the element chromium (Cr) contained in chromite products and in the refined form of its most signifi- cant primary metallurgical product, high-carbon ferrochromium. The study eval- uates the geologic, engineering, and economic determinants of 80 significant de- posits, operating properties, or districts, within 10 market economy countries, that contain chromite of a quality^ sufficient for the manufacture of at least 52 pet (contained chromium) ferrochromium or chromite suflScient for use in the re- fractory industry.* The 10 countries included in the engineering and economic cost analyses are Brazil, Finland, Greece, India, Madagascar, New Caledonia, the Philippines, South Africa, Turkey, and Zimbabwe. The major engineering and geologic factors affecting the availability of chrom- ium in each country are addressed, including quality and quantity of chromite reserves and resources, mining and beneficiation methods and costs, ferrochrom- ium production methods and costs, and modes and costs of transportation. The major economic and policy issues surrounding this industry are also ad- dressed. These issues are centered on the relative quantity and quality of resources, comparative costs of production and transportation, capacity and location of down- stream processing stages, developmental constraints upon the industry, and gov- ernmental policies that impact upon it. The following section presents an overview of the mineral and commodities in question in order to define and sharpen the perspective of the analysis. » Chromite with at least a 1.3 Cr :Fe ratio and less than 52 pet contained AUO3. * Chromite with at least 20 pet contained AljOj and 60 pet combined AljOj 4I Cr.Oj. COMMODITY OVERVIEW Chromium is a commodity of critical importance that imparts unique qualities to the material to which it is added. It is essential in the production of stainless steel and high-temperature-resistant superalloys hav- ing numerous and essential industrial and defense- related applications. There is currently no element that can act as a total substitute for chromium in the manufacture of stainless steel. Certain elements are partial substitutes for chromium in the production of some steels, with certain acceptable quality reductions. These partial substitutes, however, such as cobalt, molybdenum, nickel, niobium, and vanadium, are all priced 3 to 10 times as high as chromium. In addition, although the known-world resources of chromium exceed those of its partial substitutes, these resources are geographically concentrated in a very limited number of countries. The only known commercial source of chromium (Cr) is in ores in which the mineral chromite occurs with other gangue minerals, usually silicates and ferruginous oxide minerals. The ore containing the chromite and gangue minerals is commonly referred to as "chromitite." The mineral chromite is a member of the spinel group and has a chemical composition of FeCr204. In its purest natural form, in situ chromite contains 68 CrjO,, (chromic oxide), although seldom does it contain more than 55 pet. The grade of an in situ chromite resource and the products resulting from its extraction (ore and concentrates) are most often quantified in terms of this Cr^Os content, with most products ranging from 38 to 55 pet CrjOg to be accept- able for marketing. However, once these products are further smelted to produce ferroalloy products, the grading system is based on the chromium content of the ferroalloy. Thus, where the availability of ferro- chromium alloy production is addressed, a standard of 68 pet contained chromium (Cr) in Cr^Os was utilized to determine the content of chromium in chromite products. Chromium in the form of ore and concentrate (chromite) is classified as either high-chromium chromite or high-iron chromite, depending upon the percentage of contained chromium relative to con- tained iron (i.e., Cr:Fe ratio), or as high-alumina chromite depending upon the percentage of contained alumina (AlgOg). The standard applied throughout this report is to define high-chromium chromite (here- after referred to as high-Cr) as that which has a Cr:Fe of ^2:1, high-iron (hereafter referred to as high-Fe) chromite as having a Cr:Fe ratio of <2:1, and high-alumina chromite as containing >20 pet Al,03. Chromite products are employed in many uses, the markets for which were traditionally defined as metal- lurgical, chemical, and refractory. By far the most significant market for chromite is the metallurgical industry, which consumes both high-Cr and high-Fe chromite. The products produced by this industry are high-carbon and low-carbon (hereafter referred as to high-C and low-C) ferrochromium of varying types and specifications (i.e., amount of contained chromium, carbon, etc.), ferrosilicon chromium, and chromium metal, all of which are primarily consumed as inter- mediate products in the manufacture of stainless and superalloy steels. The chemical market, utilizing high- Fe chromite, produces sodium dichromate (a chemical base product), from which a wide range of other products and applications are derived. High-alumina chromite is primarily consumed in the manufacture of refractory bricks for use in the steel industry. Both high-Cr and high-Fe chromite are acceptable for the production of ferrochromium. The most signifi- cant difference is that high-Cr chromite produces a ferroalloy product that contains more chromium than does high-Ffi chromite. This basic relationship is shown in figure 1; the curve represents a "general- ized" functional relationship between the Cr:Fe ratio of chromite, the classification of chromite, and the amount of contained chromium present in a refined ferrochromium product. This generalized relationship is used in this study to define three ferrochromium product grades. Thus, all grade-C (also called "charge") ferrochromium is defined as containing approximately 50 to 55 pet Cr and is produced from high-Fe chromite with a Cr:Fe ratio of <1.8. Grade-B ferrochromium, defined as containing 56 to 64 pet Cr, is generally produced from chromite with Cr:Fe ratios ranging from 1.8 to 2.5. Grade-A ferrochromium, de- fined as containing in excess of 64 pet Cr, is produced from high-Cr chromite with Cr:Fe ratios >2.5. During the course of the last decade the composition of ferrochromium production has changed dramatic- ally. In the stainless steel industry, the widespread adoption of the argon-oxygen-decarburization (AOD) process for the manufacture of stainless steel has re- sulted in a very significant shift away from the pro- duction of low-C, high-Cr ferrochromium in favor of high-C, low-Cr ferrochromium since the AOD steel- making process allows for the addition of ferro- chromium with a lower chromium and higher carbon content. This has blurred the traditional distinction between chemical- and metallurgical-grade chromite that was based in part upon whether the Cr:Fe ratio was ^2 or <2. Furthermore, because the production of low-C ferrochromium requires further processing to reduce the carbon content, the high-C product is always less costly. Of particular importance to this study, however, is the fact that in either case the high-C form is always the first stage product from chromite ore or concentrate, except in limited cases where chromite ore is smelted directly with ferrosilicon chromium for the production of low-C ferrochromium. During the last 15 yr, the shift to high-C ferro- chromium as a percentage of total ferrochromium production and consumption has been large, rapid, and increasing through time. In the United States, for example, of all chromium ferroalloys consumed in the manufacture of stainless steel in 1968, 47 pet were low-C and 28 pet high-C ; by 1980 low-C ferrochromium had decreased to 6 pet of this total, while high-C had increased to a predominant 80 pet {1, p. 276; 2, p. 192). 66 -»- 64 o. 5 62 60 < O tr f^ 58 56 54 52 50 - 48 - 46 - 44 Grade C Grade B (50-55pctCr) (56-64 pet Cr) High- iron chromite -• — | — »- High -chromium chromite J I I I I I I ^. ^»_ Grade A _, (over 64 pet Cr) 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.0 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 CHROMIUM-TO-IRON RATIO IN CHROMITE PRODUCTS Figure 1. — Relationship between Cr:Fe ratio of chromite ores and chromium contained within a ferroalloy product. This technolo^cal change has resulted in a massive locational restructuring of the international ferro- chromium industry. Within the context of mineral availability, this can best be expressed by an examina- tion of the installed ferrochromium smelting capacities of the major producing countries. In 1972, it was reported that the Republic of South Africa had an installed capacity of 290,000 tpy (3, p. 10) . By 1982, this had increased dramatically to 800,000 tpy (4, p. 94) . By contrast, the United States was estimated to have had an installed capacity in 1972 of 390,000 tpy (5, p. 10) , which has subsequently declined to 145,000 tpy by 1982 a,p.97). Other major ferrochromium-producing areas are Japan and western Europe, both of which import almost all chromite raw material requirements. Japan's capacity in 1980 was around 700,000 tpy and is primarily dependent upon South Africa for its chro- mite supply. Other import sources are the Philippines and India. Western Europe's capacity (with the ex- ception of Sweden and Finland), like that of the United States, has been declining. Great Britain and France basically have no ferrochromium smelting capacity; Spain, Norway, and Italy are only small producers. West Germany now maintains most of the capacity within the European Economic Community (EEC). Western Europe also primarily obtains its chromite imports from South Africa, with the U.S.S.R., Turkey, Finland, and recently Albania as secondary sources. The cycles of the world chromium industry are in- extricably tied to the level of world economic activity in general and the world steel industry in particular. Chromium is an intermediate-product industry and as such its growth and contraction are dependent upon the demand for those products that employ it as a raw material input. Although the percentages fluctuate somewhat, the metallurgical industry remains by far the largest and most important consumer of chromite, and high-C ferrochromium has become its most im- portant product. The purpose of this study, within this context, is to ascertain the relative economics of the chromium-commodity-availability base, within the countries analyzed, in the form of chromite products and high-C ferrochromium products. METHODOLOGY OF ANALYSIS The analyses performed for the purposes of this study involved geologic, engineering, and economic evaluations. The geologic aspects particular to each current or proposed chromite operation included in the study were determined in order to develop estimates of the demon- strated and identified resource levels (see fig. 2) and in situ grades. In situ resource tonnages are reported in metric tons,^ in situ grades in percent CrgO,. The geologic discussion in each section of the report in- cludes a description of the physical criteria and as- sumptions made in the determination of the resource estimates. A tabular summarization of the demon- strated and identified resource tonnages, in situ chro- mite grades, and the amount of contained chromium at the demonstrated level, on a property by property basis, is presented for each country. All resource esti- mates are as of January 1980. It is recognized that the chromium industry is very diverse. It is not uncommon, for example, for a single mining operation to produce a mix of high-Cr, high- Fe, or refractory-grade chromite products of differing CrjO,, grades and product sizes. In addition, this product mix can change according to changing market circumstances under which the firm is operating. For this reason, certain simplifying assumptions were necessary in order to address the world chromium industry in comparative terms with a long-run pers- pective. In order to ascertain the relative cost and availability of chromite by mining operations and countries, the resources were classified according to predominant types of chromite present, either high-Fe, ^In this report, "ton" refers to the metric ton (2,204.8 lb), except where otherwise Indicated. high-Cr, or high-alumina. The high-alumina (refract- ory-grade) chromite was not further evaluated for the production of high-C ferrochromium because of tech- nological processing problems in smelting such prod- ucts. High-C ferrochromium was chosen as a ferro- alloy product for comparative purposes because of its aforementioned predominance in the metallurgical industry. The demonstrated resource level was employed for costing purposes in order to determine the relative economic position of each operation and each country studied. For cost analysis, all cost and resource esti- mates were updated to January 1981. In order to ascertain the cost and availability of chromium in the form of ore and concentrate (chromite availability), mining and beneficiation methods and costs were de- veloped according to actual or proposed development plans and associated production capacities, including all announced capacity expansions. The estimates of mining and beneficiation operating costs are composed of three components: • direct and indirect labor costs • equipment operation costs • material and supplies cost The operating cost estimates do not include : • allowances for capital recovery (depreciation) • taxes • royalties • interest charges or • reinvestments in plant and equipment These costs are calculated and entered into the analyses separately. The engineering evaluation outlines these major mining and beneficiation production methods and operating parameters, as well as the percentage con- IDENTIFieO RESOURCES Infarrad UNOtSCOVEREO RESOURCES =1= Hypothttkol ility (or) SpocMlotiv Inf«rr«d R«fl«rv« -I- Oth«r Oocurr«flC«« InchidM nonconvtntionol ond lo«-grod« mottrlolt Figure 2. — ClaMlflcatloft of mineral resourcM. tribution of each of the three components to operating cost. In addition, mining and milling capital costs, and any exploitation problems which are significant in affecting the availability of chromite from the demon- strated resource tonnages that were determined, are also addressed. In order to rank the operations and countries by resource level and degree of economic competitiveness, all mining and beneficiation operating costs and chro- mite transportation costs were recalculated for each operation on a per-ton-of -mill-product basis and aggre- gated as weighted averages, by country, along with each country's total potential availability of chromite in tons. Also calculated is a measure of the amount of crude ore that must be mined in order to produce 1 ton of salable chromite product. This measure is defined as the "concentration ratio" and addresses the quality of the host country's chromite resources from a mining- efiiciency point of view. To determine the cost and quantity of high-C ferro- chromium potentially available from these demon- strated chromite resources, by ferrochromium product grade (i.e., grade A, B, or C), the analyses were expanded to include: • ferrochromium smelting methods • smelter operating and capital costs • chromite and ferrochromium transportation and handling costs • smelting capacities and • all announced expansions to existing capacity or construction of new facilities In addition, interest on debt and all existing foreign country tax structures that relate to capital recovery and taxation of income were also incorporated into the analyses in order to perform a complete economic evaluation. The economic evaluation of each operation was per- formed using discounted cash flow rate of return (DCFROR) techniques. This evaluation determines the long-run average total cost of producing high-C ferrochromium from each operation over its producing life. The average total cost is equal to the constant- dollar long-run price at which the commodity must be sold, so that the present value of revenues equals the present value of all costs including a prespecified rate of return. For this study, rates of return of and 15 pet were specified when determining the average total cost of production over the life« of a property. The first rate (0 pet) is used to determine the breakeven point, where revenues are sufficient to cover total investment and production costs over the operation's life but pro- vide no positive rate of return. This rate would reflect the investment parameters of a project given only market share or developmental concerns, where potential multiplier effects (i.e., social benefits) would offset company-operation-specific profitability. For privately owned enterprises or those not strictly de- velopmental in nature, a more reasonable economic decisionmaking parameter is that represented by the 15-pct DCFROR. This rate was considered the mini- mum sufficient to maintain adequate long-term profit- ability and attract new capital to the industry. Within these two economic horizons lies the cost structure of the operations and countries in question. The availability of the commodity (chromite or ferrochromium) from an operation is presented in this study as a function of the average total costs associated with it. Availability curves are constructed as aggregations of all evaluated operations ordered from those having the lowest average total costs to those having the highest. The potential availability of the commodity can be seen by comparing the expected long-run constant dollar market price to the average total cost values shown on the availability curves. This report is presented in country sections to allow for a complete discussion of the costs, commodity availabilities, and future production and export poten- tial for each of the nations under study. An executive summary has been prepared which summarizes each country section, presents cross-country comparative discussions of chromite and ferrochromium product costs and availabilities, and addresses the relative resource and economic position of each nation. The relative position of the United States and its pers- pective from the point of view of a major importer of both chromite and ferrochromium, and the mineral policy issues this presents, are addressed in the follow- ing section. THE U.S. PERSPECTIVE In general, U.S. import reliance for the element chromium is 91 pet, with secondary recovery account- ing for the remaining 9 pet. The United States has pro- duced chromite in the past, most notably during the Korean War period, but is currently dependent entirely upon imports for its chromite consumption require- ments. A recent Bureau of Mines report (5) evaluated the potential of domestic chromium-bearing resources and determined that if these resources were fully developed (an unlikely event) the production potential would be small and of short duration. In addition, market prices for chromite concentrates and ferro- chromium products would have to increase substan- tially in order for any domestic-resource-based produc- tion to become economic. The major suppliers of chromite to the United States (fig. 3) are South Africa (predominantly high- Fe chromite) , Turkey and the Soviet Union (high-Cr chromite), and the Philippines (refractory-grade chromite). During the period 1977-80, South Africa «The project life of encli property evaluated was determined by assuming that the property would be operated at 100 pet of deslRned mine capacity for producing operations, or for non- producing operations, ns determined according to the engineering development plnn that was derived. The mine life covers only the demonstrated resource level. 1977-80, averoge Figure 3. — Chromlte import market shares by country. alone accounted for 44 pet of all U.S. chromite imports (6, p. 32). The Philippines has accounted for roughly 16 pet of U.S. imports, almost entirely refractory grade (6, p. 32) . The Soviet Union has averaged around 15 pet of total U.S. chromite imports during the 1977-80 period, declining through time as a major supplier of chromite relative to South Africa (6, p. 32). This trend is expected to continue. The other communist bloc country with a significant share of U.S. chromite imports is Albania, which accounted for 10 pet of U.S. chromite imports in 1979 (2, p. 195). Reliance upon imported chromite has been the case in the United States for decades, the major concern being diversification of supply sources. Of much great- er importance and concern, however, is the ever-in- creasing shift to reliance upon ferrochromium imports as opposed to domestic production of ferrochromium from imported chromite (7, pp. 173-4). Table 1 pre- sents data on ferrochromium, reported in terms of con- tained chromium, for domestic shipments, imports, ex- ports, inventory adjustments, reported and apparent consumption, and a measure of import reliance. As the data indicate, there has been a noticeable upward trend in reliance upon chromium imported in the form of ferrochromium. Prior to 1975, ferrochromium imports from all countries averaged 28 pet of apparent chro- mium consumption. Since 1975, import reliance has doubled, averaging 61 pet of apparent consumption, with 1981 posting an import reliance figure of 76 pet. This trend is also expected to continue. As a result, domestic ferrochromium capacity has continued to close and utilization of existing capacity has remained at low levels since 1980. It is estimated that capacity utilization in 1982 could be as low as 30 pet. A num- ber of measures have recently been taken by the ferroalloys industry to counteract this trend, including successful petitions filed with the International Trade Commission (ITC) (covering the period from Novem- ber 15, 1978, to November 15, 1982) imposing a mini- mum floor price of $0.38/lb contained Cr on high-C ferrochromium imports and a $0.04/lb penalty duty on imports entering the United States below the floor price. This penalty duty has expired. One of the most important issues as regards tariff levels (duties, minimum prices, etc.) is the determina- tion of production cost differentials between ferro- chromium produced in the United States from im- ported South African chromite, and the cost of ferrochromium produced in South Africa and exported to the United States. A recent ITC study (8, p. A-53) determined a $0.034/contained-Cr cost advantage, as of 1981, for high-C ferrochromium produced in South Africa and delivered to the United States as opposed to the same chromite processed to the same product in the United States. The importance of this issue is easily illustrated by the fact that for the years 1977- 81, South African high-C ferrochromium imports have accounted for 73 pet of the U.S. total. This trend of reliance upon South Africa has been steadily increas- ing. As shown in figure 4, South Africa's market share has effectively doubled during the 1970's. Zimbabwe's import market share has fluctuated noticeably (from a high of 40 pet in 1973 to essentially zero in 1978 and 1979), due to civil war and trade embargos that dis- rupted normal trading patterns. Yugoslavia and Brazil have maintained relatively constant market shares, while Japan and Finland no longer account for notice- able percentages. Imposing import quotas is another possible action to help maintain an adequate level of ferrochromium capacity, but this could require, among other things, that the ferroalloy industry be deemed essential to the Table 1. — U.S. ferrochromium market data,^ high- and low-C ferrochromium, 1970-42 (Thousand metric tons of contained chromium) Yoar Domestic imonrtc cvr,^^^ Inventory Consumption Shipments ^^^'^ ^"P^-ts adjustmel ,pp,,„, „,p,,,, 1970 187 24 17 - 1 195 165 1971 155 49 5 +10 189 153 1972 148 82 8 +5 217 187 1973 220 95 9 - 9 315 246 1974 199 93 4 - 8 296 283 1975 101 180 8 +38 235 158 1976 119 136 8 +5 242 194 1977 122 122 7 - 8 245 218 1978 112 165 11 - 9 275 248 1979 137 123 9 - 9 260 273 1980 112 158 19 - 4 255 213 1981 81 224 8 +4 293 216 1982 45 77 3 -14 134 133 ' All data subject to conversion and rounding. ^ Imports as a percentage of apparent consumption. Import reliance,'^ pet 9 pet Yugoslavia 8 pet ^^-^ Japan >V--5pet / ^Finland 11 pet Zimbabwe W ■^pct Brazil 37 pet V South Africa ^■"-^^ L_6 pet ^-y other 2 pet Other 1972-76, average 1977- 81 , average Figure 4. — Ferrochromium Import market shares by country. national security. Also, the idea has been advanced that the chromite stockpile be converted to ferro- chromium by the domestic ferroalloy industry as a way to increase capacity utilization. However, current stockpile inventories of high-and low-C ferrochromium are in excess of the stated objectives, and there is the added concern for stockpile obsolescence if the chro- mite is converted to ferrochromium. The major mineral policy issues and questions for the United States, then, are (1) to ascertain the cost and availability of chromite from current and potential international sources, (2) to determine the cost and availability of high-C ferrochromium from current and potential sources, (3) to attempt to diversify both sources of chromite and ferrochromium imports, and (4) to maintain an adequate level of domestic ferro- chromium capacity. This study specifically addresses these issues and questions. SUMMARY CHROMIUM RESOURCES Chromium contained within chromite ore occurs primarily in podiform, stratiform, and eluvial deposits. Podiform deposits occur as irregular pods or lenses and have relatively similar sizes in all three dimen- sions; i.e., length, thickness, and extension to depth. Stratiform or seam-type deposits occur as layers. They are commonly traceable over many kilometers (i.e., large strike lengths) and have large extensions to depth (along the dip of the seam) but very small thicknesses of the seam relative to the length and depth extension. Eluvial, alluvial, lateritic, and "soil" deposits are all loose definitions of various types of chromium-rich soils derived from the weathering of podiform or seam-type deposits with reconcentration either in situ (eluvial) or transported and reworked (alluvial). Podiform and stratiform are primary deposits, whereas eluvial deposits are secondary. Table 2 lists the names, producing status, and pre- dominant type of resource occurrence of all 80 opera- tions comprising the cost-evaluated demonstrated re- source that was estimated for the availability study. An in situ demonstrated resource of approximately 1.2 billion t was estimated to be contained within these 80 operations in the 10 nations under study. The relation- ship of this 1.2 billion t of cost-evaluated resource to estimates of the total demonstrated and identified resource levels for these 10 countries is illustrated in figure 5. This 1.2 billion t, although a small percentage (17 pet) of the total demonstrated resource available in these nations, still represents over 60 yr of total world consumption of chromite for all end-use applica- tions. As indicated in figure 5, effectively 100 pet of the remaining non cost-evaluated tonnage is contained within Zimbabwe and the Republic of South Africa. Figure 6 and supporting data in table 3 provide a percentage breakdown, by country, of the cost- evaluated tonnage. Two nations, Zimbabwe and South Africa, contain approximately 70 pet of this total. The estimates for these two nations are but a small subset of their poten- tial, with total in situ estimates for South Africa ranging from 3.096 billion t (9, p. 55) to as high as 16 billion t {10, p. 120) ; for Zimbabwe, estimates run as high as 10 billion t.'' For the purpose of cost evalua- tion, these subsets were calculated according to specific property information and geologic criteria as detailed in the text. However, just these small subsets them- selves represent over 50 yr of potential total world consumption. If the analysis were expanded to include a complete geologic estimate of world chromium re- ^ Confidential source. Table 2. — Name, status, and resource type of the 80 operations comprising the cost-evaluated demonstrated resource level, as of January 198r Name Type of occurrence Status^ Name Type of occurrence Status^ South Africa: Zimbabwe — Continued: Zwartkop . Stratifomi P/S Valley Chrome . . . Podiform P/S Consolidated Chrome do P/S Magazine Hill do P/S Ruighoel< do P/S Ironsides do P/S Ntuane do P/S Iron Ton do P/S Waterkloof do P/S Belingwe District do P/S Millsell do P/S Impinge (eluvial) . . . Eluvial P/S Kroondal do P/S Turkey: Rustenburg (Chrome Chemicals) . do P/S Kefdag . . . Podiform P/S Henry Gould do P/S Soridag . . . Stratiform P/S Moolnool do P/S Kavak . . . Podiform P/S Ucar Chrome do P/S Kopdag West-North Zone do P/S Winterveld (TCL)-North Section . . do P/S Uckopru do P/S Groothoek do P/S Kandak do P/S Dilokong do P/S Philippines: Montrose (Hendriksplaats) do P/S Masdang do E do P/S Narra do P/S Lavino (Grootkx)om) Grasvally do P/S do P/S do P/S Candelaria do E Marico (Nietverdiend) do P/S Lagonoy do P/S Zeerust do P/S Llorente . . . Eluvial-alluvial E Zimbabwe: Bicobian . . . Lateritic-eluvial E Gienapp-lvo do P/S Batang-Batang ...Alluvial E do P/S Bacungan . . . PouiTorm"Gtuvi&l P/S Sutton-Rodcamp do P/S Irahuan do E Vanad do P/S Coto-Masinloc Podiform P/S Caesar do P/S Kinmalgin .......do P/S Crown-Divide North do P/S India: Glenapp-Hay-Noro do P/S Byrapur do P/S Umvukwes do P/S Jambur-Tagadur ...Stratiform E Ore Recovery Tribute do P/S Cuttack District: Greenvale do P/S Low grade . . . Stratiform-podiform . . . E Maryland do P/S High grade do P/S McGowan do P/S Keonjhar District: Divide do P/S Low grade do E Rutala do P/S High grade do P/S UmSW6SW6 do P/S Brazil: Umsweswe-Bee do P/S Pedrinhas (Campo Formoso) . . . . . . Stratiform P/S Windsor-York-York West do P/S Limoeira (Campo Formoso) . . . . do P/S Bat Claims do P/S Finland: Kami do P/S do P/S P/S Netherburn do P/S Greece: Xerolivado do P/S York do P/S Madagascar: . Podiform P/S Andriamena do P/S Selukwe Peak do P/S Ranomena do P/S ' The term "operation" refers to either an individual mine or group of mines, or an area, section, or district, depending upon the criteria of each individual nation under study. ^ The status is listed as either P/S or E. If listed as P/S, the operation is either a current or past producer. If listed as E, no production had occurred as of January 1 981 . sources on an identified basis (demonstrated plus inferred resources) these two southern African na- tions would represent over 95 pet of the total, which could be as high as 27 billion t or more. Six nations constitute the "others" category, which comprises only 6 pet of the total cost-evaluated re- source estimate. The remaining two nations, India and the Philippines, have recently increased their level of resources and represent 7 and 16 pet of the total, respectively. India's demonstrated resource level has been increased primarily by lowering the cutoflf grade of the Cuttack and Keonjhar districts, used for defin- ing the resource estimate, to 30 pet CrjOg. The resource estimate for the Philippines includes recently investi- gated large tonnages of very low grade eluvial de- posits. These deposits contain smaller amounts of recoverable Cr^Oj relative to their in situ tonnage estimates than do podiform-type deposits in countries, such as Turkey and New Caledonia, which have smaller in situ tonnage estimates but much higher CrgOg grades. The world chromium industry developed historically around the exploitation of these high-grade, podiform- type resources of limited tonnage. As they are de- pleted, the trend in production toward dominance by very large tonnage, seam-type resources will continue. These seam-type resources are located almost entirely in Zimbabwe and the Republic of South Africa. In addition to the operations and nations extensively evaluated in this report, there exist other deposits and/or countries that may produce chromite in the future. These deposits, listed in table 4, were not evaluated at the time of this study because insufficient information existed concerning the geologic, engineer- ing, and economic determinants to allow for a complete cost evaluation. Future research concerning the avail- ability of chromium in the market economy countries should also concentrate on these deposits. 10 17% of totol demonstrated resource of 10 nations studied 4% of world identified level Figure 5. — Relationship of cost-evaluated tonnage to an estimate of the total demon- strated and Identified resource levels within the 10 nations under study. Table 3. — Summary of cost-evaluated In situ chromium-bearing resources r,„ „,„,„^ Percent Weighted- Contained C°""^^ resource St °'»°'^' ^^«^^9«g^^d«- ^^A- resource, 1 0- 1 ^^^^^^^ ^^ ^^^^^ ^ ^3 ^ South Africa 637,876 53^ 4^0 370,227 Zinnbabwe: ^^^^~^^:^~——-——^^^^^^^^^^^^^^:^:^:::=:=^ Seam type 175,000 NAp 49.0 NAp Podiformtype 16,900 NAp 46.5 NAp Eluvial soil 4,700 NAp 20.0 NAp Total or average.. 196,000 16.5 49.0 94,329 Turkey M 1,630 1.0 38.0 4,500 Philippines: Low grade 178,495 NAp 2.0 NAp High grade M2.301 NAp 30.3 NAp Refractory ^ 16,960 NAp 26.0 NAp Total or average . . 207,756 17.5 5J 11,716 India 81,230 7^0 3Z0 26.000 Brazil ''17,000 1.4 21.0 2,900 Finland 29,200 2.4 27.0 7,884 New Caledonia 2,300 .2 44.0 1 ,01 2 Greece 2,200 .2 18.0 396 Madagascar 10,250 .8 31.6 3.270 Grand total " 1 ,196.000 100.0 NAp 522,234 NAp Not applicable. ' Does not include the many small deposits and operations, representing 20 to 30 pet of Turkey's overall total production of chromite products, which are too small or sporadic to evaluate for costs. ^Does not include 21 deposits containing about 1.8 million t of in situ resources; 18 are very small (average 40.000 t reserve); 3 are fairly large (average 360.000 1). Small size or lack of data precludes estimation of costs. ^Does not include 12 deposits containing about 1.1 million t of in situ resource; 10 are very small (average 50.000 t); 2 are fairly large (average 300,000 1). " Represents resource in the Campo Formoso District only. COMPARATIVE CHROMITE AVAILABILITY This section presents a brief cross-country com- parative summary of chromite production costs and availability. Table 5 and figure 6 provide an overvie'w of relevant chromite product cost and availability data for the 10 countries studied in the cost evaluations. As illustrated in figure 6, there are approximately 632 million t of chromite products potentially recover- able from the 1.2 billion t of chromium-bearing ma- terial contained within the 80 operations, deposits, and districts of these 10 nations. Over 85 pet of the total recoverable chromite is contained within just two nations, Zimbabwe and South Africa, with South Africa alone accounting for 65 pet of total chromite availability. All other country product tonnages are quite small by comparison. This concentration of chromite re- sources in South Africa, in and of itself, should ensure that the world chromite industry will be increasingly dominated by the cost and production levels of this country. The great majority (82 pet) of the total cost- evaluated chromite tonnage is potentially recoverable at a combined long-run mining, beneficiation, and transportation cost level, FOB the port of exportation, of $100/t. Of this overall total, 80 pet is contained within the South African operations. At a long-run cost level of $65/t of product, about 37 pet of the total tonnage is potentially recoverable, and of this total, 80 pet is also contained within the South African operations. Therefore, it can be expected that the South African mines will increasingly establish the long-run average cost level for the world chromite industry as a whole. This infers that in periods of weak demand and low or falling prices for chromite, the South African producers will dominate a very large part of the mark- et since they represent by far the greatest availability of low cost products. In addition, in periods of high demand and rising prices, the South African industry, with its ability to expand mining capacity relatively quickly with scale economies, will provide a moderat- ing effect upon prices, thereby ensuring long run dominance of the market. 11 17.5 pet 7N. \Philippines / \ \ / 16.5 pet \ V. \ / Zimbabwe \ 1.9 pet Philippines-v / 20.5 pet / Zimbabwe \ 16.8 pet/ \ llndia/ / /2,7 pet Finland C^l.2 pet Turkey /TN^I.9pctAII others 53 pet / South Africa / \ 65 pet \ South Africa / Totolwl.2 X lO^t, Total=632xlO*t, in situ postmill basis Figure 6. — Percentage distribution, by country, of total cott-evaiuated In situ ton- nage and total chromlte product availability. Table 4. — Other chromlte resources, market economy countries^ Country Deposit Type of resource Estimated in situ Grade, pet tonnage, lO^t Orfi^ Problems and status Australia Coobina High-grade, type deposits. Canada Winnepeg District do Greenland Fiskenaesset Low-grade, seam-type deposits. None announced Residual deposits and laterites. Papua New Guinea . . Ramu River South Africa East and West Bushveld Complex. 18,600 2,500 100,000 630,000 28-49 1.5 Remote location, refractory-grade material. 8.7 1 .0-1 .48 Very low Cr:Fe ratios. 20-26 1 .0-1 .2 Remote location, very low Cr:Fe ratio. NA NA Exploration being conducted for low- grade eiuvial chromlte deposits. Also chromlte in Nl-Co laterites. 5-10 NA Remote location, low-grade, some of economics will depend on Nl-Co laterite technology and economics. - 5.5 1 .2-1 .3 Extractable at certain operations on the Complex, but economic and mart64 pet contained Cr) ; grade- B (56 to 64 pet contained Cr) ; and grade-C (52 to 55 pet contained Cr). These product grade groupings recognize the real difference in the selling price of ferrochromium, which is dependent upon the amount of chromium contained in the ferroalloy product. The long-term average total production cost and avail- ability of each product grade from each producing and potential operation are shown graphically on avail- ability curves. Weighted-average total production costs (by ferrochromium product grade) are then derived for each country in order to rank individual countries. Lastly, these production costs are compared with U.S. import prices in an attempt to determine the relative long-term competitive position of the ferrochromium industry in each country vis-a-vis the U.S. market. Grade-A, High-Carbon Ferrochromium The cost and availability of grade-A, high-C ferro- chromium is depicted graphically in figure 7, with respective country percentage contributions to total availability shown in figure 8. Generally, in the ab- sence of ore blending, chromite with a Cr:Fe ratio 2.5 or greater is required for the production of grade-A 2 g-.20 KEY -1 T- ' ' ' r - -: — - 15- -0- pet rate of return pet rate of return rJ - f 1 .s^-- -( — __i"" r ^: , 1 -J f - - '■ 5 10 15 20 25 30 35 40 45 50 55 60 65 TOTAL POTENTIAL FERROCHROMIUM, lO^t Figure 7. — Cost and potential availability estimates of grade-A, high-carbon ferrochromium. 14 4.0 pet All others 4.0 pet Philippines 4.7 pet Turkey *6l.9xl0°t Total =* 280x10^ Figure 8. — Percentage contribution, by country, to total eatlmates by product grades A, B, and C. high-carbon ferrochromium availability high-C ferrochromium. Six of the ten countries evalu- ated have at least some chromite resources of a quality sufficient for producing this product, the great ma- jority of which is contained within currently produc- ing operations. Of these countries, Zimbabwe alone contains 87.3 pet (54.1 million t) of the potential availability estimate of 61.9 million t of grade-A, high- C ferrochromium. Table 8 ranks the countries according to tonnage potential and weighted average cost per pound of Table 8. — High-carbon ferrochromium; cost ranges per pound of contained chromium, availability estimates, and percentage distribution, by country (1981 U.S. dollars) Country ''^^TJa" aS'esSe'^'"'^ Availability estimate, 1 0^ t Breakeven cost level 1 5-pct profitability cost level GRADE A Zimbabwe 87!3 54,097 $0.22-$0.43 $0.25-$0.50 Turkey 4.7 2,892 .33- .46 .36- .46 Philippines 4.0 2,439 .32- .41 .34- .64 Madagascar 2.5 1 ,535 .47 .48 Nev\^ Caledonia 1 .2 726 .25 .29 Greece ^3 241 .49 ^7 Total or weighted-average 100.0 61,930 .37 .40 GRADE B South Africa 55 24,412 $0.31 -$0.34 $0.36-$0.50 India 40 17,798 .36- .50 .56- .79 Brazil 4.5 1,899 .41- .53 .50- .59 Philippines .5 244 .38- .43 .44- .46 Total or weighted-average' 100 44,353 .32 .44 Africa Id pines Total or weighted-average. ' The overall average is calculated without factoring in the Indian cost determinations in order to reflect existing conditions. GRADE C South Africa 95 3 2 165,411 5,332 2,850 $0.26-$0.51 .29 .40- .56 $0.30-$0.55 Philippines .43- .70 Total or weighted-average 100 173,593 .38 .43 15 contained chromium. The cost estimates for Greece are higher than the other countries because this country is just now developing its own ferrochromium indus- try. The cost estimate derived for Madagascar repre- sents the cost to produce ferrochromium in Japan from Madagascar chromite resources, since that coun- try has no local ferrochromium smelting industry. The cost estimates for New Caledonia and the Philippines (with the exception of one operation) are also on a Japan-market basis. For Zimbabwe and Turkey, the estimates represent the cost to locally manufacture ferrochromium (including the cost of new smelting capacity) . In order to evaluate these costs relative to a common base, they are compared with import sales prices for chromium delivered to the United States. On this basis, weighted-average cost for all grade-A ferro- chromium ranges from $0.37/lb contained Cr at the breakeven level to $0.40/lb at the 15-pct profitability level. As of the first quarter of 1981, imported grade-A ferrochromium was selling in the United States at prices between $0.46/lb and $0.49/lb contained Cr; a difference of between $0.06/lb and $0.12/lb. However, it is estimated that ferrochromium transportation costs to the United States can average anywhere from $0.04/lb to $0.12/lb contained Cr. Thus, the difference of between $0.06/lb and $0.12/lb is similar to the range of transportation costs to the United States from the different countries involved. It must be stressed that the actual cost of any individual ferro- chromium shipment is dependent upon such factors as the point of origin, the market conditions at the time of shipment, the size of shipment, the point of delivery, the number and length of stops (demurrage charges), etc. Given these factors, it is felt that inter- national shipping costs for ferrochromium should fall within this $0.04 to $0.12 range, but these costs are highly variable. According to this criterion, at least two-thirds of the total grade-A ferrochromium availability estimate can be considered internationally competitive at the 1981 cost and price levels. In particular, grade-A ferro- chromium produced in Zimbabwe and Turkey, and Japanese production from high-grade Philippine and New Caledonian chromite, are the most cost competi- tive. These three countries are major world producers of this product. Ferrochromium produced in Greece appears to be the least cost competitive. The Greek government's development of a domestic ferrochro- mium industry would appear to be based more upon developmental concerns or EEC trading arrangements than international cost competitiveness. Grade-B, High-Carbon Ferrochromium The cost and availability of grade-B, high-C ferro- chromium is presented in figure 9 with supporting data aggregated by country given in table 8. Percent- age contributions by country are shown in figure 8. A total of 44.3 million t is potentially available at breakeven costs of up to $0.53/lb contained Cr. The cost estimates for Brazil, India, and South Africa represent total domestic manufacture of ferro- KEY 15-pct rate of return • O-pct rate of return r- ^: 20 40 60 80 100 120 140 ISO 180 TOTAL POTENTIAL FERROCHROMIUM, 10^ Figure 9. — Cost and potential availability estimates of grade-B, high-carbon ferrochromium. chromium from local chromite resources. The cost estimates for the Philippines represent the cost to produce this grade of ferrochromium in Japan from Philippine chromite resources. Although 40 pet of the total potential tonnage is available from India, it must be remembered that the Indian ferrochromium industry is only beginning to be developed, and it is uncertain, at this point in time, whether all proposed capacity will in fact be con- structed. Thus, the 24.4 million t available from pro- ducing South African operations really represents the great majority of total available tonnage from current smelting capacity. It is primarily this South African long-run production cost level that the ferrochromium industry of India will potentially compete against. In terms of cost, South Africa is approximately 25 pet lower than the Indian operations, evaluated at the breakeven level, and approximately 35 pot less at the 15-pet profitability level. The cost estimates for India, at the 15-pct level, are markedly higher than the other nations because of the large capital investments that would be required to fully develop India's domestic ferrochromium industry while obtaining this long-run level of profitability. Of greater significance is the fact that of the total tonnage of grade-B ferrochromium potentially avail- able at or below the average breakeven cost level, approximately 100 pet originates from South Africa. Of the total tonnage potentially available at the aver- age 15-pct profitability cost level, over 98 pet originates from South Africa. This means that in this product category (and indeed in all lower grade chromite ore and ferrochromium categories) as prices increase, an increasing percentage of the market is filled with South African products (since almost all mining operations that were analyzed in South Africa are producers, the ferrochromium smelting capacity is in place, and the ability to expand mining and smelting capacity relatively quickly with scale economies is also present) . Also, as prices decline. South Africa virtually becomes the market since 98 to 100 pet of all grade-B ferrochromium potentially available at or below the average cost points is a South African product. Comparing these cost estimates on a contained- chromium basis, delivered to the United States, with 16 average selling prices of imported grade-B ferro- chromium, again shows that the long-run production costs herein estimated are similar to the first quarter 1981 market prices when transportation costs are included. The costs determined, range from $0.32/lb to $0.44/lb contained Cr, which are similar to the first quarter 1981 U.S. import selling prices of $0.46/lb to $0.47/lb. Grade-C, High-Carbon Ferrochromium The cost structure and availability situation for «rade-C ferrochromium is also entirely based upon cost conditions in South Africa. As figure 8 indicates, 95 pet of all potential grade-C ferrochromium is de- rived from South African-based chromite resources. This is of particular importance, since this grade of ferrochromium has been capturing the largest share of the world ferrochromium market, with the wide- spread adoption of the AOD steelmaking process dur- ing the last decade. The cost estimates, at both profitability levels, for South Africa (see figure 10 and table 8) are average cost ranges for the production of grade-C ferro- chromium from South African chromite resources. The ranges are composites of the cost of producing this product in South Africa, the United States, Europe, and Japan. South African production costs are at the lower end of the range (the weighted aver- age South African cost is $0.32/lb Cr) with production in Japan and western Europe occupying the upper end of the range. The United States is estimated to have a weighted average of $0.43/lb. These cost ranges illustrate the predominant position of South Africa as either the source of chromite for the production of ferrochromium or, increasingly, the source of this ferrochromium product itself as South Africa con- tinues to increase its smelting capacity. It is important to note again that neither Western Europe nor the United States produce any chromite products. Japan's production of chromite is very insignificant relative to its consumption. Thus, these nations are heavily dependent upon South Africa for their chromite raw material inputs to the ferrochromium production process. .36 S 32 1 1 1 r , 15-pct rate of return 0-pct rate of return y: TOTAL POTENTIAL FERROCHROMIUM, 10 Figure 10. — Cost and potential availability grade-C, high-carbon ferrochromium. The Philippines (as a source of chromite for Japan- ese ferrochromium smelting) and Finland (an ex- porter of ferrochromium) are significant because of their location vis-a-vis major markets. In this regard, special attention is paid to the poten- tial for exploiting the very low grade "alluvial" and "eluvial" deposits of the Philippines and their potential use by the ferrochromium and steel industries of Japan. It appears at this point in time that the economic position of this resource is submarginal, and since the potential tonnage of ferrochromium available from these very low grade chromite resources is limited, the Philippines source will probably never attain the significance of South Africa as a raw materials supplier to Japan. The country-wide average breakeven and 15-pet profitability level cost estimates range from approxi- mately $0.38/lb to $0.43/lb contained Cr, respectively. Imported grade-C ferrochromium was selling in the United States in the first quarter of 1981 for $0.44/lb to $0.46/lb contained Cr, which again indicates that these derived costs, after factoring in transportation charges to the United States, are very similar to import market prices. By this criterion, virtually all of the 165.4 million t of grade-C ferrochromium po- tentially availabile from the chromite resources of the (mostly) active mines in South Africa, as well as the potential 5.3 million t in Finland, can be considered as economic. In general, it can be concluded that constraints to the further expansion of the international ferro- chromium industry are not resource based (there is no shortage of chromite), nor in most cases studied, economic. Rather, the industry is directly tied to the level of demand and highly concentrated in those nations that possess the vast majority of chromite re- sources, productive smelting capacity, and currently hold a dominate market share for the products in ques- tion. Clearly, South Africa has a long-term advantage for the production of high-C ferrochromium, for as figure 8 clearly indicates, 68 pet of the total 280 million t of high-C ferrochromium of all grades poten- tially available from the total demonstrated in situ resource that was cost-evaluated, is either produced in South Africa or represents smelting capacity depend- ent upon South African chromite resources. On an individual country basis, the major implica- tions as a result of the information and analyses of this study are as follows : South Africa • Both chromite and ferrochromium production should increase in the future, both in absolute terms and as a percentage of the world total. • South Africa should increasingly set the long-run minimum cost (and price) levels for both chromite and high-C ferrochromium as a result of an enorm- ous chromium resource base, large mining and processing capacity, and the attendant scale economies. • The increase in high-C ferrochromium smelting capacity should come at the expense of declining U.S., European, and Japanese capacity. 17 Zimbabwe • Chromite and ferrochromium production costs should rise through time as the podiform resources are depleted and a greater percentage of production comes from the seam-t3T)e operations. • Large capital investments will be required to alle- viate transportation and energy supply bottlenecks in order to realize the full potential of the industry. • The availability of chromite products for export should decline as the country's stated goal of utiliz- ing 100 pet of its chromite for ferrochromium pro- duction is instituted. Turkey • Full capacity production of ferrochromium (includ- ing expansion plans) would exhaust the demon- strated resource estimate in 26 yr ; the potential for proving additional chromite resources is considered good; and ferrochromium production and export should increase as chromite exports decrease. Philippines • The construction of the Philippines' first commer- cial-scale ferrochromium smelter and the resultant ferrochromium production will reduce the amount of high-grade metallurgical chromite available for export and represents a continuation of the trend toward ferrochromium production in those countries that mine chromite. • The vast majority of the low-grade eluvial and alluvial resources currently appear to be subeconomic both in terms of chromite and ferrochromium pro- duction costs. India • Major implications are that chromite export con- trols and increased domestic production of high-C ferrochromium in the future will reduce chromite products available for export. This also represents a continuation of the trend toward ferrochromium production in those countries that mine chromite. Brazil • Should be able to meet its projected domestic ferro- chromium consumption needs and continue to export relatively small quantities of ferrochromium prod- ucts, but does not hold any promise as a major available source of imported chromite for the United States at this time. Finland • Should remain a major exporter of both chromite and ferrochromium for the rest of this century. New Caledonia • All chromite output should most likely go to Japan as raw material feed for the production of high-C ferrochromium. Will probably play only a minor role in the overall world production of chromite in the future. Greece • All chromite production will be processed locally into high-C ferrochromium at the newly constructed smelter with the output being exported, most likely to the EEC. Madagascar • No major change in trading patterns is expected, and the construction of a domestic ferrochromium smelter remains doubtful. THE REPUBLIC OF SOUTH AFRICA GEOLOGY AND RESOURCES South Africa's chromite resources are predominant- ly contained within four basic geographic-geologic areas (fig. 11) : (1) the eastern (Lydenburg) belt of the Bushveld Complex, (2) the western (Rustenburg) belt of the Bushveld Complex, (3) the Potgietersrust- Grasvally District located in the northern part of the Bushveld Complex, and (4) the Zeerust-Marico Dis- trict, an extension of the Bushveld Complex to the west of the western belt. Much has been published in the past on the origin, geology, and mineralogy of the Bushveld Complex (10-19). The following chromite resource discussion focuses mainly on the specific geologic data and as- sumptions pertinent to this analysis rather than attempting a comprehensive overview of the myriad of information published on the Bushveld Complex. As a whole, the Bushveld Complex covers a total of 67,000 sq km and consists of three major rock forma- tions : a granite-granophyre unit, the Rooiberg f elsite, and a gabbro-norite fraction. In terms of economic minerals, the gabbro-norite unit is the most important since it contains a magnetic-vanadium horizon, a platinum-bearing horizon (the Merensky Reef) , and a section of numerous chromite seams. The gabbro- norite unit can be more specifically broken down into country rock units of pyroxenite, norite, and anortho- site which contain the chromite and platinum seams as individual layers that are generally concordant to the igneous layering. Further subdivision of the chromite seams within the Complex is possible into three major groups — (1) the upper group, (2) the middle group, and (3) the lower group — but this is as far as a gen- eral subdivision or correlation can go. The number and type of chromite seams present varies from one mining property to another. Table 9 summarizes the general 18 LEGEND O City or town • Port facilities li Ferrochromium smelter (existing) I I Railroad (^^ Pyroxenite area (gobbroond norite) 100 200 300 Figure 11. — Location of South African chromlte mining areas, smelting facilities, railway network, and ports of exportation. Table 9. — General characteristics of upper, middle, and lower group chromlte seams in South Africa Group Geological characteristics Important seams Economic significance Upper — Anorthosite country rock, same marker bed as for platiniferous Merensky Reef. Lowest Ox^^ grade, thinnest seams, fewest seams (2) of all the groups. Inconsistent outcrops. , Norite and anorthosite country rock. In idealized geologic section, this group is stratigraphically closer to lower group than to upper group. , Mostly pyroxenite country rock. As many as 25 or more individual, uncorrelated seams have been identified. Most consistent outcrops of the 3 groups. UG2. MG1,MG2, MG4. Main seam (also known as LG6, main, Steelpoort, and Magazine seam at various localities), leader seam, LG2, LG3, LG4, H, F . The UG2 seam is to be processed by Western Platinum for production of platinum-group metals, copper, and nickel. Could produce chromlte concentrates of low CrjOj grade (35 to 40 pet) with a low Cr:Fe ratio (1 .35), but processing and economics are still relatively unknown. The lowest grade group in terms of Cr^Oj. . The MG1 , MG2, and MG4 seams are presently being mined in West Bushveld. Predominantly medium-grade, high-Fe chromlte ores and concentrates (43 to 47 pet Cr203; 1.5 to 1 Cr:Fe ratio). The vast majority of past and present production has been from seams classified as lower group seams. The main and leader seams together comprise the "main horizon" and are most important from a chromite production standpoint. Predominantly high-Fe chromite ores and concentrates. (43to47pctCr2O3;1.5to2.0Cr:Feratio). Boschoek to Brits section in West Bushveld. Section north of Pilanesberg in West Bushveld. Rustenburg to Marikana sector in West Bushveld. Sector east of Marikana in West Bushveld. Section in area north of Steelpoort River in East Bushveld. Nearly ubiquitous in all areas. Basically absent only in four areas: (1) 20-km section north of Rustenburg. (2) 1 5-km section from Brits westward. (3) Most of the 35-km section from the Consolidated Chrome mine northeast to the Zwartkop mine. (4) 1 5-km section north of Steelpoort River. characteristics of each of the three groups of chromite seams. As shown, only 11 seams have had or could have economic importance to the chromite industry in South Africa. A major portion (60 to 75 pet) of chromite ore in South Africa is friable, which means that it occurs as loose grains or in fragments that readily disintegrate into "fines" when handled. Products from mining and milling are basically in five forms: (1) friable run-of- mine ore, (2) hard, lumpy run-of-mine ore, (3) ore concentrates, (4) refractory-grade ore, and (5) foun- dry sand. 19 Because the majority of Bushveld chromite is rich in iron content and low in Al^O,, content, it has limited use as a refractory material. However, the seams in the Marico-Zeerust District and those of the Grasvally District are of better refractory quality (more AljOs, less FeO) than the main Bushveld ores. This overall "less-refractory" quality of South African ores is claimed to give them an advantage over Zimbabwean ores in terms of ferrochromium smelting because they can be smelted at a faster rate with slightly less flux addition (16, p. 34). For example, a normal medium- grade South African chromite ore contains only 28 pet slag-forming materials versus 87 pet for a typical Zimbabwean ore (16, p. 34). Because of the large strike lengths (horizontal sur- face distance) and generally continuous nature of the seams (particularly for the lower group), both hori- zontally and to depth, any projection for resource estimation purposes will result in enormous chromite tonnage estimates for the entire Bushveld Complex. The official Bureau of Mines reserve estimate as of 1980 was 2.5 billion t (6, p. 33), while the official South African Minerals Bureau estimate was as high as 8.096 billion t (9, p. 55). At 1980 crude ore (full capacity) production levels, these tonnages, if proven to be extractable, would last 370 and 507 years, res- pectively. Other resource estimates run as high as 16 billion t (10, p. 120), which at 1980 crude ore (full capacity) production levels would last for over 2,600 yr. The above estimates do not include chromite con- centrates that possibly could be produced from the platiniferous UG2 seam, which has been estimated to contain pso million t of chromium-bearing material to a vertical depth of 1,200 m (19) . Assuming that rough- ly 10 pet of this material is comprised of the mineral chromite and assuming a milling recovery of 80 pet to produce a 35-pct-Cr,03 concentrate, this 630 million t of material in the UG2 would contain about 50 million t of chromite concentrates. The most recent and detailed estimate of chromite resources in South Africa is that of Von Gruenewaldt (19). His calculation in 1981 separated the resource into an "identified reserve" category, defined as ex- ploitable material down to a vertical depth of 150 m, and an "identified resource" category, defined as ex- ploitable material from 160 m down to 1,200 m, which he considers the depth to which the prevailing geo- thermal gradient would allow mining operations in the Bushveld Complex. The "identified reserve" category is estimated at 718 million tons, of which 12 pet is considered high-Cr material and 88 pet high-Fe material. The "identified resource" category is esti- mated to contain an additional 8.535 billion t com- posed of 7 pet high-Cr material and 55 pet high-Fe material in seams presently being mined, and 38 pet high-Fe material in seams not presently being mined. Thus, his estimate to 1,200 m vertical depth totals 9.253 billion t. In contrast to the huge estimates reported above, this study analyzes the economics of extracting only about 638 million t of in situ material at the demon- strated level. Table 10 presents these data on a proper- Table 10. — Estimated In situ chromite resource data for selected South African operations as of 1980 Average Irvsitu tonnage', 10^ Operation in situ grade, pet CrzOs Demonstrated resource Contained CrjO, Identified resource^ West Bushveld: Zwartkop 44,5 59,317 26,396 178,269 Consolidated Chrome 40.0 4,275 1 ,710 16,291 Ruighoek 41 .0 16,227 6,653 60,873 Ntuane 38.0 14,898 5,661 49,370 Walerkloof 42.0 19,212 8,069 73,575 Millsell 42.0 4,836 2,031 26,297 Kroondal 42.0 33J08 14,157 123,830 Rustenburg (Chrome Chemicals) 39.0 24.920 9,719 88,981 Henry Gould 40.0 21.957 8,783 78,370 Mooinooi 38.5 21,294 8,198 127,656 East Bushveld: Ucar Chrome 44.0 29,075 12,793 67.978 Winterveld (TCL)-N. Section 41.0 43,815 17.964 150,757 Groothoek 41.0 29,004 11,892 66,335 Dilokong 42.0 42,179 17,715 81,573 Montrose (Hendriksplaats) 43.0 36.130 15,536 60.216 Winterveld (TCL)-S. Section 40.5 112,946 45,743 195,442 Lavino (Grootkxwm) 41.5 21.321 8,848 21,321 Potgietersrust-Grasvally District: Grasvally 30.0 21,471 6,441 44,336 Zeerust-Marico District: Marico (Nietverdiend) 43.0 60,971 26,217 376,891 Zeerust 43^0 20.320 13,038 20,320 Total or average Ml .0 ^637,876 '267,564 2,785,768 ' Data may not add to totals shown because of averaging and independent rounding. ' Identified resource tonnage calculated to 1 ,000 m vertical depth; equals demonstrated plus Inferred tonnage; where equal, there was insufficient information to support an inference beyond the demonstrated level. ^ Country grade is the In situ weighted average over all operations at the demonstrated level. ' Covers all seams for which there is current production or for which there was production in the late 1970'8 calculated according to the specific geologic and engineering criteria outlined in the text for the purpose of cost analysis. ' Total in situ contained CrzOa, at the demonstrated level for all operations Included in this study, summed over all Individual operations. Does not equal weighted-average grade times total demonstrated resource level. 20 Table 11. — Criteria for determination of demonstrated chromite resource estimates for selected South African operations Operation and farm' District and seam Demonstrated resources, lO^t In situ Recoverable Evaluated mine Estimated life capacity level, of recoverable lO^tpy resources, yr Deptti, m Strike length, Vertical Incline Zwartkop: Zwartkop : West Busfiveld— Magazine (LG6), 1.317 53,385 Schildpadnest 385, Vlakpoort 388, Intermediate, New. Middellaagte 382. Haakdoorn 374. Consolidated Chrome: Groenfontein West Bushveld— Main (LG6). 302. Ruighoek: Ruighoek 169JP . .do Ntuane: Ruighoek 169JP, . .do Vogelstruisfontein 173JP. Waterkloof: Waterkloof 305JQ do Waterkloof 306JQ do Total or average. Waterkloof 305JQ do Do West Bushveld — Leader . Total or average West Bushveld (MG1) East Bushveld— Steelpoort (LG6). do 43,815 Kroondal: Kroondal 304JQ West Bushveld— Main (LG6).. Do West Bushveld — Leader Total or average Rustenberg (Chrome Chemicals): West Bushveld — Main (LG6). . Rietfontein 338JQ. Henry Gould: Buffelsfontein 467JQ do Elandsdrift 465JQ do Total or average Moolnooi: Elandskraal 469JQ. Ucar Chrome: Jagdiust 418KS. Wlnterveld417KS. Winterveld (TCL)— N. Section: Waterkop 113KT, Zwartkopies 413KS, Paschaskraal 466KS. Groothoek: Groothoek 256KT, Twyfelaar 1 19KT, Driekop 253KT Dilokong: Maandagshoek 254KT, Mooihoek 255KT. Montrose (Hendriksplaats): Hendriksplaats281KT. Winterveld (TCL)— S. Section: Doornbosch 294KT. Winterveld 293KT. Onvenwacht 330, Goudmyn 337KT. Lavino (Grootboom): Grootboom 336KT. Annex Grootboom. Grasvally: Grasvally 293KR Potgietersrust Zoetveld 294KR do Total or average Marico (Nietverdiend): Marico-Zeerust— LG2 Goudini 30JP, Allenyspoorl 29JP, Marico-Zeerust— LG3 .Driekop 14JP. Strydfontein 12JP. Marico-Zeerust— LG4 Total or average . . . Zeerust: Turfbult 10JP Marico-Zeerust— LG3 Marico-Zeerust— LG4 16.227 14,898 13,793 14,071 250 60 55 234 1.5 1.6 300 300 1,442 1,917 4.000 2,400 4,028 15,184 NA NA NA NA NA NA 1.5 1.5 200 300 1,000 1,442 1,600 3.000 , 19,212 15,369 175 88 NAp NAp NAp NAp 2,613 2,223 NA NA NA NA NA NA 1.5 1.5 200 200 1,230 1,000 1,900 1,900 4,836 4,352 250 17 NAp NAp NAp NAp , 23,354 , 10,354 NA NA NA NA NA NA 1.5 1.5 300 300 1,570 1,570 4,500 4.500 . 33,708 . 24,920 30,337 21,182 350 225 87 94 NAp 1.5 NAp 300 NAp 1,333 NAp 4,800 . 17,121 . 4,836 NA NA NA NA NA NA 1.5 1.5 300 300 1,240 1,240 4,000 1,000 21,957 18,373 21 ,294 19.165 29,075 26.168 do do do do 29.004 24,653 42,179 35,852 36,130 32,517 112,946 101,651 East Bushveld— F 21,321 Total or average . Grand total 240 220 400 240 600 ,300 64 80 119 NAp 1.5 1.5 NAp 300 300 NAp 1,400 710 NAp 3.000 10,500 197 1.6 300 1,040 12,000 62 1.6 600 2,050 4,000 149 1.6 300 1,442 7.500 54 1.6 600 2,316 4.000 78 1.7 600 1,442 11,000 5,035 . 16,436 NA NA NA NA NA NA 2.4 2.4 500 500 708 1,600 872 3.400 21,471 19,293 385 53 NAp NAp NAp NAp NA NA NA NA NA NA NA NA NA NA NA NA 2.0 2.0 2.0 200 194 194 780 850 2.085 1,200 1,640 13,900 . 60,971 44,674 85 525 NAp NAp NA^ NAp NA NA NA NA NA NA NA NA 2.0 2.0 36 204 602 3,750 2.011 12.560 . 20,320 16,015 85 188 NAp NAp NAp NAp . 637,876 553,110 NAp NAp NAp NAp NAp NAp ' The number assigned to Farm names is current as of 1980 and is an integral part of the Farm name. ty basis for the demonstrated and identified resource levels, as well as in situ CrgO, grades and contained Cr^O., at the demonstrated level. Table 11 provides greater detail as to the farms,^ districts, seams, recov- 8 A mining property can consist of anywhere from one to ns many as five or six farms or leases, depending upon the Indlvldnnt holdings by companies. erable resource tonnages, vertical and inclined depths, strike lengths, and estimated life at capacity operation, for the 20 properties evaluated. To determine the demonstrated resource level, the seams have been projected to a vertical depth of 300 m in the majority of cases. Where the projection is <300 m, the operat- ing company does not own the lease area (farm) in 21 / 35 pet Mining and processing losses+ nonmetallurgicol use products Chromlte product availability 3.096 xlO^t, South Atrica Minerals Bureau estimate , 1980 Figure 12. — Summary of South African cost-evaluated In situ tonnage; percent of total potential, distribution, chromlte composition, and chromlte product availability. the direction of the projection. Where the projection is >300 m, the size of the operation was such that the rate of mining indicated the need for greater projec- tion to reflect a reasonable life for the operation. This estimate of demonstrated resources (see figure 12) represents roughly 20 pet of the South African Min- erals Bureau estimate and consists of approximately 16 pet high-Cr chromite (Cr:Fe ^2) and 84 pet high- Fe chromite (Cr:Fe <2). Of this total tonnage, over 99 pet is material that will have to be mined by under- ground methods. In terms of individual seams, fully 72 pet (457 million t) is contained in the LG6 seam (also called Magazine, Main, and Steelpoort seam), while the remaining 28 pet is split among nine differ- ent seams. Of the demonstrated 638 million t, it is estimated that 533 million t should be recoverable through mining, and this in turn should produce about 412 million t of lump ore, fines ore, and ore concen- trates for metallurgical use. The operations and seams listed in tables 10 and 11 constitute the demonstrated resource level evaluated for cost and availability purposes in this study. They only represent the operations and/or seams that are presently producing, are temporarily shut down, or have produced in the recent past. There are two reas- ons for this limited choice of demonstrated resource for analysis: 1. The operations analyzed include all planned ex- pansions of the present operations. In the South African chromite industry, expansion of existing operations seems to be preferred over developing new ones in undeveloped areas. As stated in the South African Mining and Engineering Journal of January 1980, "it is unlikely that new mines will be developed in the near future unless they form part of an inte- grated operation" (20, p. 59) . 2. The average life of the demonstrated resources for the 20 operations analyzed, at full capacity opera- tion, is 124 yr. Even this relatively small amount of resource is enormous in comparison to the other na- tions evaluated. In a discussion of tonnages beyond the demon- strated resource analyzed, a few points should be made. First, if all of the seams shovsTi in table 11 are projected to a further vertical depth of 1,000 m, the extension adds about 2.1 billion t of in situ inferred material to the 638 million t at the demonstrated level, for a total identified tonnage of around 2.7 billion t of material. When it is considered that this is only for seams presently being mined on producing lease (farm) areas, it is easy to see how Von Gruenewaldt's "identified resource" for all seams to 1,200 m on pro- ducing plus nonproducing farms could be calculated at 8.535 billion t. Second, it should be realized that many engineering and cost details are unknown about mining at vertical depths of 1,000 to 1,200 m on the Bushveld Complex for a relatively low-cost commodity like chro- mite. The geothermal gradient at Rustenburg Plati- num's operation is about 21° C (70° F) per 1,000 m. This would indicate that at a vertical depth of 1,200 m the temperature would most likely be over 50° C (120° F) and refrigeration would definitely be required, as is the case at Rustenberg Platinum. By contrast, at 600 m vertical depth (the maximum limit of this study), ambient rock temperatures would be only about 30° C (86° F), and no refrigeration would be necessary. Third, at a dip of 15°, a vertical depth of 1,200 m would indicate the need for a 4,500-m haulage distance underground if the present inclined shaft method is used. This is at least four times greater than what some of the deepest operations are experi- encing at present and indicates that a different method of access would be chosen to mine at this depth. Be that as it may, the demonstrated resource of 638 mil- lion t herein evaluated is sufficient for South Africa to produce at a rate at least one-third above 1979's production level through the 21st century and can be attained simply by slight expansion and/or extension to operations and seams presently in production. 22 MINING AND BENEFICIATION Except for less than 0.5 pet, all of the demonstrated resource will have to be mined by underground meth- ods. In general, the mining method in use on the Bushveld Complex, breast stoping, does not vary a great deal from operation to operation since the seams all dip gently (5° to 25°) and have similar structural and mineralogical characteristics. The most significant difference in terms of effect on mine operating cost lies with the thickness of the chromite seam in relation to the stoping height. In the majority of operations, the seam thickness is 0.9 m or greater and usually represents 90 pet of the stope height, which means that relatively little waste is produced in stoping operations and can be packed back with little trouble. However, some seams are as thin as 0.4 m, in which case fully half of the material blasted will be waste material. In this case, it is very difficult to pack all of the waste back and as much as 50 pet has to be transported to the surface. This can add as much as 60 pet to the mine operating cost on a crude ore basis, everything else being equal. In general, one stoping section is set up to produce any- where from 60,000 to 120,000 tpy of ore. Stoping heights vary from as little as 0.9 m to as great as 1.8 m, depending upon the seam thickness. As far as is known, only one operation stopes out two seams from one stope, the remainder are mining only one seam at a time. Access is almost exclusively by means of inclined shaft systems that parallel the dip of the seam, al- though topographic characteristics can make adit access feasible, as at the Lavino operation south of the Steelpoort River on the East Bushveld. These in- clined shaft systems are usually designed to serve about 1 to 1.5 km of strike length over the life of the shaft and can have individual hoisting capacities of 20,000 to 200,000 tpy of ore, although most are in the 100,000 to 120,000 tpy range. Older shafts use drum hoisting of ore and waste, but most of the newer shafts utilize conveyor belt hoisting, especially where the dip is 15° or less. Mine operating costs estimated for the 20 operations were determined to reflect the long-run average cost in constant dollar terms to mine out all of the asso- ciated resource for that operation. On a crude ore basis, they range from as low as $17/t to as high as $43/t. In terms of a percent of total mine operating cost, labor costs are estimated to constitute anywhere from 38 to 45 pet, materials and supplies compose 33 to 38 pet, and equipment operation 20 to 25 pet. Productivities in underground chromite operations in South Africa are estimated to range from 0.5 to 1.5 t per worker-shift, with the majority of operations estimated to have productivities around 1 1 per worker- shift. Since all operations analyzed are either producers or on standby status, the initial capital investments have been recouped. Mining capital costs, then, are primarily composed of ongoing development work and replacement of mining equipment. Replacement of typical mine equipment at the properties analyzed would range from about $5/t to $14/t of annual crude ore capacity, while development costs for all work other than actual stoping would range from $l/t to $7/t of annual capacity. It is roughly estimated that to bring a 200,000-t capacity, underground operation into production from scratch in South Africa would cost $4 to $6 million. It is important to note that at one recently developed South African mine in this size range, it took only 15 months to develop the mine and construct the mill, with ore being stockpiled only 5 months after the start of shaft development (21, p. 87) . The importance of this is to underscore the tre- mendous flexibility of the South African chromite industry. In general, production can be doubled or halved, in light of changing market circumstances, in the course of less than a year. Thus, as prices for chromite products increase, the South African chro- mite industry can quickly expand production, thus moderating prices and ensuring their dominant posi- tion in the international market for chromite products. For this reason, it is not likely that countries with submarginal chromite resources, such as the United States, will be able to economically develop a domestic chromite industry on a world market basis. Similarly, as prices decline, the South African mines can reduce production or temporarily shut down, which also tends to moderate prices. A period of declining or low mark- et prices for chromite products can place some South African mines in a position where revenues are not sufficient to cover variable costs of production and where these variable costs are greater than the fixed costs incurred from not producing. When the market again turns up, these mines have the ability to reopen and expand quickly with scale economies and change the product mix if required. All of the material analyzed in South Africa goes through at least rudimentary benefieiation. A variety of methods are in use at the 20 operations, depending upon the types of products desired. The methods range from a simple screen, hand-sort operation to a complex heavy-media, magnetic, gravity-separation plant. In the former, examples of products would be a minus 23-cm, plus 2-cm lump product and a minus 2-cm, run- of-mine fines product. In the latter, examples of products would be a plus 1-em lump product from heavy-media separation and two different-sized con- centrate (fines) fractions from gravity and magnetic separation. The majority of the operations utilize methods between these two extremes, consisting of either crushing-washing-screening-hand sorting or crushing-washing-grinding-gravity separation. In general, where gravity separation is utilized, the pre- ferred method is with spirals, even though some prop- erties utilize Wifley tables or diamond pans. Overall recoveries of CrjOg range from 75 to 90 pet, with the vast majority around 82 to 85 pet. With the simple methods, the Cr^Os grade can be raised only a small amount, estimated to range between 1 and 4 pet. However, with the more complex method, some ma- terial is being increased from as low as 30 to 33 pet Cr^Og in the ore feed to 50 pet in the concentrate product. Benefieiation operating costs are insignificant rela- tive to the overall cost of chromite products FOB the port. The estimated operating costs for the beneficia- tion plants analyzed range from $1.75/t to $6/t of crude ore feed. The labor portion of these costs is estimated to range from 40 to 50 pet, while equipment operation accounts for roughly 20 to 25 pet, and maintenance-supplies costs contribute 30 to 35 pet. Mill plant and equipment costs vary considerably in terms of the estimated replacement cost. They range, roughly, from an inexpensive $2 per annual ton of crude ore feed for the simplest screen-sort operation to as high as $12.50 per annual ton of crude ore feed for the most complex methods. The more common gravity mills cost about $6 per annual ton of crude ore feed capacity. Thus, for a 200,000 tpy gravity milling operation, the estimated plant and equipment capital investment would be approximately $1.25 mil- lion. Infrastructure reinvestments should represent a minor portion of future investments by the operations since all are either producers or on standby status, and most infrastructural items are in place. It should be noted that in the mid-1970's concern was raised that the operating companies were gener- ally restricting investments in their beneficiation plants and that this policy had resulted in bottlenecks and inadequate capacity at some operations." It is believed that this problem has been partially addressed as evidenced by production levels and expansion plans of the late 1970's. This study has incorporated into the economic analysis all necessary mill capacity ex- pansions to accommodate the mining capacity expan- sions that were assumed. Bottlenecks at the milling production stage, in terms of cost and time, would seem to pose no serious problem for the South African chromite industry under the relatively small increases assumed for this study. CHROMITE AVAILABILITY Mining of chromite began in South Africa in 1924 and has been continuous since that time. It is esti- mated that approximately 40 million t of chromite products have been produced in South Africa through 1980. Annual output has been steadily increasing. Production in 1979 totaled 3.3 million t of chromite products, a 37-pct increase over 1976 production (22, p. 33). In 1980, production was up slightly to 3.4 million t of products (6, p. 33). South Africa now accounts for roughly one-third of total world chromite production and around 60 pet of market economy country production. It is estimated in this study that to produce 3.3 million t of products per year would require about 4.3 million t of crude ore and would represent the extrac- tion of about 4.8 million t of in situ resource. If market conditions warrant and all planned expansions of the late 1970's were instituted in 3 yr, the 20 operations analyzed could produce a total of about 4.5 million t of products from about 6.1 milion t of crude ore, an increase of 36 pet over 1979's production. At this production level, individual mine capacities would •Confidential source. range from 25,000 to 1.3 million tpy of crude ore, with an average of 300,000 tpy. Chromite product output would range from 19,000 to 877,000 tpy, with an aver- age of 225,000 tpy. Almost all of the chromite products produced in South Africa are either high-Cr chromite or high-Fe chromite, with the great majority being high-Fe chromite suitable for the production of grade-C, high- C ferrochromium. Three major cost items determine the FOB operat- ing cost per ton of chromite product; mining and bene- ficiation costs per ton of chromite product, plus trans- portation, handling, and loading costs to the closest port of exportation (excluding capital costs and taxes). These costs were determined for each operation and are related to cumulative chromite availability in figure 13. These operating costs are long run average costs of extracting, processing, and transporting all of the chromite products potentially recoverable from the demonstrated resources herein evaluated. The esti- mated productive lives vary from 17 to 525 yr, depend- ing upon each operation's resource and production level, with an average mine life of 124 yr. Because the time frame is so long, these mining and milling operat- ing costs take into account such factors as increasing underground haulage distance and additional under- ground development needed, as well as expansions to mining and processing capacity planned for the near term as they affect operating costs. As such, they re- flect general trends through time (which is the purpose of this study) but do not necessarily represent cur- rent costs of operation. Transportation costs do repre- sent current costs (in 1981 dollar terms) and reflect the general infrastructural network in place as of the study date. Given that mine operating costs per ton of crude ore range from $17 to $43, and a weighted average ore-to- concentrate product ratio of 1.2, then mine operating costs per ton of chromite product vary from approxi- mately $20 to $52, as shown in figure 13. A weighted average over all tonnage yields an estimate of $35, which represents around 54 pet of the total combined operating costs. For 19 of the 20 operations, mill operating costs per ton of crude ore range from $1.75 to $4.00, which results in a range of from $2/t to $5/t of chromite product. This low cost and narrow range is a result of similar and relatively constant mill feed grades, mill recoveries, and beneficiation methods used. The weighted average of $4 over all chromite product tonnage represents approximately 6 pet of the com- bined operating costs. Table 12 presents a breakdown of the most common routes, transport modes, general distances, and trans- portation costs from the four chromite producing re- gions of South Africa to the two closest ports of exportation, and to the Witbank area (see figure 11 for details), which was selected as a centrally located ferrochromium smelting center in order to ascertain an average chromite transportation distance to smelt- ing facilities. For all four regions, there is a distant cost savings to utilizing the port of Maputo in Mozambique, with the operations of the East Bushveld able to reduce chromite transport costs by one-half, overall, when 24 400 TOTAL RECOVERABLE CHROMITE, lO^t Figure 13. — Mfnlng, milling, and transportation costs, FOB Durban, and availability of chromlte from selected South African operations. Table 12. — Most common routes, transport modes, approximate distances, and costs from the four chromite-producing areas in South Africa (January 1981 dollars) Originating district or area and Approximate distance, km Cost per metric ton chromite destination Truck to railhead Rail Range Weighted average East Bushveld: Port-Maputo, Mozambique &-60 450 $12-$17 $14.00 Port-Durban, South Africa 5-60 1,025 27-32 29.00 Smelter-Witbank' 5-60 275 7-15 11 .00 West Bushveld: Port-Maputo, Mozambique 5-20 600 15-20 16.50 Port-Durban, South Africa 5-20 800 20- 25 22.00 Smelter-Witbank' 5-20 225 ^6-9 7.50 Potgietersrust: Port-Maputo, Mozambique NAp 650 NAp 17.00 Port-Durban, South Africa NAp 900 NAp 25.00 Smelter-Witbank' NAp 300 NAp 8.00 Marico-Zeerust: Port-Maputo, Mozambique 60 700 NAp 23.50 Port-Durban, South Africa 60 900 NAp 28.00 Smelter-Witbank' 60 350 NAp 17.00 NAp Not applicable. ' Refers to the WItbank area as the point of common reference. 25 utilizing this port. However, Maputo has declined noticeably in terms of the amount of cargo handled since the latter half of the 1970's. The most recent estimates show Maputo handling only about 500,000 tpy (23, p. 330) and currently can only berth vessels up to 65,000 t (2i, p. 53). The inland distances from mine sites to ports range from approximately 450 to 750 km to Maputo and from approximately 800 to 1,100 km to Durban. All mines are in close proximity to railheads and with the exception of the Steelpoort- Belfast Branch line and Zeerust to Krugersdorp, all South African railroads handling chromite or ferro- chromium are fully electrified. Transportation costs average $14/t to $23.50/t of chromite to Maputo and $22/t to $29 /t to Durban. If all South African chro- mite production was exported through Durban (the closest South African port) , a weighted average cost of $26/t of product is estimated ; when combined with long-run, weighted-average estimates of mining and milling costs, this gives a total FOB cost of $65/t of chromite product, with transportation representing 40 pet of the total. Thus, at a long-run FOB Durban (operating) cost level of $65/t, approximately 220 million t of chromite products are potentially avail- able. At an operating cost level of $85/t, all 412 mil- lion t of chromite products are recoverable. It is im- portant to note, as figure 13 indicates, that the total FOB Durban operating cost per operation ranges from approximately $50 /t to $85 /t. This relatively narrow (and low) range reflects the fact that these operations are similar in geology, production methods, and hence costs. The total chromite product availability estimate from the demonstrated resources of the South African operations is a huge 412 million t of chromite, with an average grade of 43 pet Cr^Oj. The tremendous size of this availability estimate and the scale of the South African chromite industry in relation to the other countries discussed in this study can be emphasized by taking South Africa's 1979 production of around 3.3 million t of chromite products and dividing it into the chromite product availability estimates derived for the other nations. At this production level. South Africa would have at least 124 yr of easily attainable production, whereas Finland would have only 5.2 yr, New Caledonia and Greece <1 yr, the Philippines 3.7 yr, India 13 yr, Madagascar 1.2 yr, Zimbabwe 39 yr, Turkey 2.3 yr, and Brazil 1.4 yr. Clearly, South Africa should increasingly dominate the chromite industry in general throughout the 21st century, as long as there remains a market for primary (mined) chromium. It is expected that the long-run minimum cost level, which determines long run prices, will increasingly be set by the South African industry, thus ensuring that particularly high cost, potential producers of chromite, such as the United States, will probaby never achieve production on an economic basis. HIGH-CARBON FERROCHROMIUM AVAILABILITY Currently, there are six ferrochromium smelters in South Africa, with a combined capacity of approxi- mately 750,000 tpy of high-C ferrochromium, 46,000 tpy of low-C ferrochromium, and 24,500 tpy of ferro- silicon chromium. The great majority of productive capacity is devoted to high-C ferrochromium, which is reflective of world demand for high-C relative to low-C ferrochromium. South Africa roughly accounts for about 20 pet of world production of high-C ferro- chromium. It is important to note that the invention of the AOD steelmaking process by Union Carbide created the large markets for high-Fe chromite for metallurgi- cal use and high-C ferrochromium as an additive to the manufacture of stainless steel. These markets came to be heavily dominated by the South African chromium industry. This development was the result of many factors, such as the Rhodesian trade embargo, but most of all represents aggressive South African develop- ment and marketing of their tremendous chromite resources. Figure 11 shows the locations of South African ferrochromium smelting facilities that are all ideally situated with respect to energy sources (coal and electric power) , raw material sources (dolo- mite, silica, etc.), labor supply, transportation net- works, and, most importantly, the chromite operations themselves. Table 13 provides respective smelter capa- cities. There are basically four chromite input feeds in use at the six smelters, with the diiferences due to the type of feed material used and the preparation required prior to smelting : 1. The conventional feed, using 100 pet lumpy ore — in use at the Machadodorp and Krugersdorp smelters. A briquetting plant has recently been installed at Krugersdorp, which allows them to use either run-of- mine lump or fines and concentrates. 2. The combination of run-of-mine ore (30 to 40 pet) and fines and concentrates (60 to 70 pet) as feed — in use at the Tubatse (Steelpoort) smelter. 3. Feed consisting entirely of fines and concentrates which must be converted to partially reduced pellets because of the use of the Showa-Denko process — in use at the Lydenburg smelter. 4. A combination of lumpy ore and briquets made from fines and concentrates — in use at the Middelburg and Witbank smelters. Smelting recoveries at older smelters were assumed to be 80 pet, while at newer smelters a 90-pct recovery was utilized for evaluation. At current capacity levels, the domestic ferrochro- mium industry requires roughly 2 million t of chromite to operate at full capacity utilization. If future develop- Table 13. — Current South African ferrochromium smelters and estimated 1980 capacity for the production of high- and low-C ferrochromium and ferrosillcon chromium (Thousand metric tons) Smelter location Ferrochromium High-cart)on Low-cartwn rGfrosilicon chromium Machadodorp Middelburg Krugersdorp Witbank (Samancor) .... Lydenburg Tubatse 80 100 80 200 120 170 26 20 20 4 Total 750 46 24 26 ments in the South African chromite industry proceed as assumed in this report and chromite production were to increase to 4.5 million t of ore and concentrate products, then either additional chromite exports or ferrochromium production and export would ensue, market conditions warranting. In order to determine the long-run average cost, availability, and relative economic position of South African ferrochromium producers, this study determined average production costs from a number of perspectives. First, South African chromite export levels and pat- terns of the late 1970's were maintained and the en- tire ferrochromium smelting capacity was utilized with domestic chromite resources. The additional ton- nage of chromite production left over after accounting for chromite exports and for current South African ferrochromium production capacity was assumed to be sent to new ferrochromium facilities in order to factor in the cost of expanding the local industry. This extra tonnage would represent about 500,000 tpy of additional ferrochromium production capacity. This assumes that each furnace will operate at its rated capacity. However, a technique for handling run of mine ore and concentrates has been developed at Tubatse which allows their furnaces to operate at 25 pet above rated capacity. The continuation of such developments would have the double effect of lowering the estimated amount of capacity that needs to be added while also making South African ferrochromium that much more competitive. In terms of construction time and costs, this addition would not be difficult since the present smelters, es- pecially the newer ones, are designed to make low- capital-cost extensions possible by the fairly simple addition of a furnace module. As stated in the South African Mining and Engineering Journal (20, p. 55), "certain plants could, for instance, add a module and thus produce an additional 100,000 t of ferrochromium per year for less than a $40 million investment." It is estimated that total capital investments of approxi- mately $400 to $500 million would be required to achieve this 500,000 tpy increase in capacity. It is felt that this level of expansion is well within the capa- bilities of the South African ferrochromium industry. The average total cost of producing ferrochromium in South Africa was then calculated on an FOB smel- ter basis and compared to the average cost of ferro- chromium FOB the port of Durban in order to isolate the cost contribution resulting from inland trans- portation of ferrochromium to this port, including all handling and loading expenses. The results of these analyses are given in table 14. It is estimated that inland ferrochromium transporta- tion costs from the smelters located near the Bushveld Complex to the port of Durban average approximately $0.03/lb of contained Cr. This is the difference between the weighted average total cost estimate of $0.32/lb of Cr calculated FOB Durban as opposed to the $0.29/ lb Cr estimated FOB the smelter. An additional analysis was performed in order to determine the cost differential between ferrochromium manufactured in the United States from imported South African chromite and the same product manu- factured in South Africa and then shipped to the Table 14. — Weighted-average cost estimates per pound of contained chromium for the production of hIgh-C ferrochromium from South African chromite resources, the United States versus South Africa FOB smelter, South Africa. . . FOB Durban, South Africa. . . Smelted in the United States, FOB Pittsburgh $0.29 .32 15-pct DCFROR $0.38 .41 United States. To determine the cost differential, the same mining operations that formed the basis of the long-run average cost estimate for South Africa were assumed to have all chromite output shipped to the United States for the manufacture of high-C ferro- chromium. The result (see table 14) was a weighted- average, long-run, breakeven cost level estimate of $0.43/lb of contained Cr as compared to $0.32/lb determined FOB the port of Durban. However, it is estimated that ferrochromium transportation costs to the United States can average anywhere from $0.04/lb to $0.12/lb contained Cr. Thus, the difference of $0.11/ lb is not considered to represent a large competitive advantage for the South African producers, since ferrochromium transportation costs to the consuming centers within the United States (in this case Pitts- burgh via Baltimore or New Orleans, including barge and rail transport) can easily offset this differential. Within the context of this analysis, there would appear to be a South African advantage of only a few cents per pound of contained chromium. Two caveats are in order. First, the actual trans- portation cost of any individual shipment is dependent upon such factors as market conditions at the time of shipment, size of the shipment (ranging from a few t up to complete shiploads or 15,000 t or more) , point of delivery, number and length of stops (demurrage charges), etc. Given these factors, it is felt that inter- national shipping costs for ferrochromium should fall somewhere within this $0.04 to $0.12 range, but the variability of these costs must be stressed. Second, it must also be stressed that the variability of inter- national shipping costs also affects not only the deliver- ed cost of chromite concentrates but also the delivered cost of other raw material inputs that U.S. ferroalloy producers, located in areas such as South Carolina or Ohio, would incur. What does represent a long-term advantage for South African producers is the fact that all raw ma- terial inputs into the smelting process are readily available within close proximity. This fact, and the desire to increase domestic product value added, repre- sent the primary rationale behind the trend of locating downstream processing stages close to the sources of raw material inputs. In the case of South Africa, this fact, coupled with the long-run momentum of large installed capacity and the attendant scale economies, as well as the advantages from vertical integration, should ensure that South African smelting capacity will increase while U.S. and European capacity de- clines. The issue the United States should address on a governmental policy level is how much domestic 27 K .04 KEY 15-pcf rate of return 0-pct rate of return 20 40 60 SO 100 120 140 160 180 TOTAL POTENTIAL FERROCHROMIUM, 10^ t Figure 14. — Cost and potential availability estimates of liigli-cariMn ferrochromium from selected South African chro- mlte operations. ferroalloy capacity, if any, should be maintained and at what cost. Lastly, an analysis was performed to determine the total amount of ferrochromium production potentially available from South Africa's demonstrated chromite resources. This total South African chromite-resource- based, high-C ferrochromium availability estimate is approximately 190 million t, which represents 68 pet of the total ferrochromium tonnage potentially avail- able from all of the demonstrated chromite resources evaluated in all 10 of the nations studied. Of this total, fully 87 pet is grade-C and 13 pet grade-B ferro- chromium. Figure 14 relates the cost per pound of ferrochromium to cumulative potential ferrochromium availability from the 20 South African chromite operations evaluated. These cost estimates were pur- posely derived to run the gamut from those repre- senting South African ferrochromium production from domestic chromite resources, to those representing production in the United States, Europe, and' Japan from imported South African chromite. The purpose is to demonstrate the long-run average total cost of South African chromite resource-based ferrochromium availability on a major ferrochromium-producing- country basis; and in order to emphasize the pre- dominance of South Africa as a world supplier of chromite for metallurgical uses. The cost estimates (table 15) range from $0.14/lb to $0.27/lb of grade-C ferrochromium at the breakeven level (with a weighted average cost of $0.40/lb of contained Cr) and represent the minimum, long-run, constant dollar cost level of world grade-C ferrochromium production utilizing South African chromite. The cost estimates for grade-B ferrochromium (if assumed to be process- ed entirely within South Africa) would range from Table 15. — Breakeven cost level estimates of ferrochromium production from South African-based chromite resources Grade C Grade B Total Cost range per pound ferrochromium $0.14-$0.27 $0.18-$0.21 NAp Welglited-average cost per pound contained Cr $0.40 $0.29 NAp Availability estlmate-IO^t 165,000 25,000 190,000 Pet of total availability estimate . . . ^7 13 100 NAp Not applicable. $0.18/lb to $0.21/lb ferrochromium (with a weighted- average cost estimate of $0.29/lb contained Cr) . This total ferrochromium availability estimate, like the one for South African chromite products, is enormous. To illustrate, if all current South African ferrochromium smelting capacity (820,500 tpy) were devoted exclusively to the production of high-C ferro- chromium from just the 638 million t of South African chromite resource that was cost evaluated, this total tonnage estimate would represent 231 yr of ferro- chromium production. If all planned capacity expan- sions were constructed, this tonnage estimate would still represent over 143 yr of full-capacity production. Basically, there are no "life" limits to either the South African chromite or ferrochromium industries. The amount, product mix, and duration of production will depend solely upon the demand for chromium products. In terms of long run cost and availability, it is expected that South Africa will increasingly dominate the ferrochromium industry conceivably throughout the 21st century, and that the long-run minimum cost level for high-C ferrochromium will be set by the South African industry. Even including the cost of expanding ferrochromium smelting capacity by almost two-thirds results in a weighted average, breakeven domestic cost level of $0.32/lb contained Cr, FOB Durban; and even the analytical requirements of a 15-pct long-run rate of return on this increased level of productive capacity results in an average total cost estimate lower than that determined at the breakeven level for the United States (i.e., $0.41/lb as compared to $0.43/lb contained Cr). And again, it must be stressed that the in situ demonstrated resource level from which this ferrochromium availability estimate is derived is itself a very conservative estimate, repre- senting only 20 pet of the official South African Min- erals Bureau estimate. In short, the world's high-C ferrochromium industry for grades B and C is domi- nated in terms of cost and quantity by South Africa. SUMMARY • A cost evaluation was made of 638 million t of chromium-bearing resource contained within 20 operations. • This resource is estimated to contain 412 million t of recoverable chromite products suitable for metallurgical use, with a weighted average grade of 43 pet CrjOg. • Total high-C ferrochromium potentially produc- ible from this chromite resource is estimated at 190 million tons. • Chromite production costs, as defined, were esti- mated at $65, FOB Durban, South Africa, with mining cost per ton of product accounting for 54 pet, milling 6 pet, and transportation 40 pet. • High-C ferrochromium production costs, as de- fined, were estimated for South African producers at $0.32/lb contained Cr at the breakeven level, FOB Durban, South Africa. The same chromite resource smelted to the same grade of ferro- chromium in the United States was estimated to cost $0.43/lb contained Cr, FOB Pittsburgh. 28 Ferrochromium transportation costs to the con- suming centers of the United States were esti- mated to range from $0.04/lb to $0.12/lb of con- tained Cr. • South Africa currently accounts for approximate- ly 33 pet of world chromite production and 20 pet of world high-C ferrochromium production. • Major implications are that both chromite and ferrochromium production should increase in the future, both in absolute terms and as a percentage of the world total. South Africa should increas- ingly set the long-run minimum cost (and price) levels for both chromite and high-C ferrochro- mium as a result of an enormous chromium re- source base, large mining and processing capa- city, and the attendent scale economies. The increase in high-C ferrochromium smelting capa- city should come at the expense of declining U.S., European, and Japanese capacity. ZIMBABWE GEOLOGY AND RESOURCES Zimbabwe's chromite resources may be categorized into six different types of occurrences :(1) the seam- type deposits of the Great Dyke, (2) the podiform- type deposits of the Selukwe area, (3) the podiform- type deposits of the Belingwe area, (4) eluvial (resi- dual) deposits scattered over the Great Dyke, (5) the podiform deposits of the Mashaba area, and (6) the so-called "chromite inclusion" deposits of various areas off the Great Dyke proper. Only the first four types of deposits have been of any economic or pro- duction significance over the years and, as such, are the only types discussed in detail in this section. Great Dyke Seam Deposits The Great Dyke is one of the most striking geologic features in the world. Covering nearly 7,500 sq. km, it is an igneous rock complex with a north-northeast, south-southwest trend of about 535 km and an average width of 5 to 6 km, with its maximum width measured at 11 km in the vicinity of the town of Selous. As shown in figure 15, the Great Dyke begins about 145 km north of Harare (Salisbury) and extends to a point about 150 km southwest of Fort Victoria. Also, as shown in figure 15, the Great Dyke is geologically compartmentalized from north to south into four dif- ferent complexes — Muzengezi, Hartley, Selukwe, and Wedza — ^which correspond to four separate basic-ultra- basic intrusions. However, the sequence of rock types from complex to complex is remarkably similar and can be divided into four major zones as follows: (1) quartz gabbro, (2) norite and gabbro, (3) anorthosite gabbro, and (4) lower ultramafic zone (serpentinite, dunite, and pyroxenite) . The lower ultramafic zone comprises a basal dunite zone, a central, olivine-rich, dunite-peridotite (harz- burgite) zone, and a very thick upper zone composed almost entirely of enstatite (a pyroxene mineral) . The chromite seams occur within the central harzburgite zone and the upper pyroxenite zone. Worst (25) identified 11 chromite seams within the Great Dyke Complex. These chromite seams are usually quite dis- tinct and persistent. There has been no mining of any chromite seams in the Muzengezi Complex, with only six seams out- cropping at isolated localities. The Hartley Complex has contributed the most production from the seam-type deposits because the seams are generally thicker here and extend over greater distances along strike. All 11 of the chromite seams have been identified in this complex. The Selukwe Complex has provided the second larg- est amount of production from the seam deposits. However, relative to that from the Hartley Complex, total production has not been very large. Although 7 of the 11 chromite seams are known in this complex, the vast majority of production has come from only seams 1, 2, and 5, and most was from shallow, labor intensive surface excavations ("pig-rooting"). The Wedza Complex is the least explored of all of the complexes and has contributed very little produc- tion, all from limited, small scale, open pit operations. Six seams (1-6) are known in the Wedza Complex either from outcrops or from the Wedza borehole. Each of the four complexes has a synclinal form in cross section, with the synclinal axis plunging gently north and south from its respective south and north ends towards the center of the complex. Where they outcrop, both limbs (east and west) show dips ranging from 26° near the margins to only 4° near the axis with an overall average of around 16°. Work in the Mtoroshangu area has proven that dips decrease to horizontal at the center of the Dyke, in effect connect- ing the two limbs across the width of the Dyke. Persistence of the seams along strike has also been well documented by prior mining operations and loca- tions of outcrops. In the area of the Dyke south of Mtoroshangu Pass (south of south latitude 17°, 6'). tectonic effects, mainly in the form of faulting, are minor. The area north of Mtoroshangu Pass has under- gone somewhat more faulting and intrusion and, as such, the continuity of chromite seams cannot be assured. However, this increased tectonic activity has actually caused the area north of Mtoroshangu Pass to account for the largest portion of past production from the seam deposits because outcrops are more numer- ous, access by adits and shallow incline shafts is pos- sible, and it is also possible to mine more than one seam from one access system in certain cases. B. G. Worst (25) defined the 11 chromite seams of the Great Dyke in terms of the marketing characteris- tics prevalent at the time (1960). Thus, he character- ized seams 1, 2, and 3 as "chemical-grade" chromite ore, and seams 4 through 11 as "metallurgical-grade" LEGEND O City or town h Ferrochromium smelter ■«-♦-» Roil rood ^Greot Dyke outline Jj (section covetoge shoded) Figure 15. — Location of chromite mining tion networi(, Zimbabwe. Scale, km i' smelting facilities, and transports- ores. Worst chose this characterization simply because the Cr:Fe ratios in seams 1, 2, and 3 are commonly in the 1.8 to 2.3 range while those in the other seams are very high, ranging from 2.5 to as much as 3.4. Changes within the ferrochromium industry would now place all of this material in the metallurgical category, since chromite with Cr:Fe ratios as low as 1.3 can be used in producing grade-C charge ferro- chromium and ores with low and high Cr:Fe ratios can be blended to produce intermediate grade ferro- chromium. Owing to the high AlgOj and MgO contents (typic- ally 11 to 13 pet ALO., and 14 to 17 pet MgO), much of the Zimbabwe seam chromite is suitable for refractory use and does have negative aspects in the smelting process because it forms more slag material and re- sults in a slower smelting process. However, for this study it was assumed that all of the seam chromite material analyzed could be utilized for ferrochromium production, simply because the market for refractory- grade chromite in and from Zimbabwe is very limited and is provided, at present, almost entirely from Selukwe podiform operations. Table 16 characterizes all 11 seams in terms of CrjjOg content, Cr:Fe ratio, thickness, and ore-quality tjrpe. Obviously, when trying to generalize occurrences Table 16. — Great Dyke chromite seam characteristics Thickness, m CfjOj Cr:Fe ratio Seam - average, Ore type Occurrence Range Average pet ' 0.15-0.40 0.22 46 1.6-2.3 Hard lumpy along outcrop, friable down-dip; Cr^Oj content can be very variable. All 4 complexes, more important south of f^^toroshangu Pass. 2 .15- .40 .35 46 1.4-2.3 Hard lumpy along outcrop, friable down-dip. Do. 3 .08- .20 .12 48 2.6-2.9 Hard lumpy along outcrop, semi-friable to friable down-dip, limited data. Selukwe and Hartley complexes most important. 4 .04- .20 .15 49 2.4-3.3 Coarse-grained and hard on outcrop and to depth-a preferred metallurgical ore. Do. 5 .05- .20 .12 50 2.8-3.0 Description only of basal portion-friable to semi-friable ore. IVIost important in Hartley complex. 6 .08- .15 .12 50 3.0 Bulk of material is friable, 50 pet hard lumpy in outcrop. Do. 7 .10- .15 .15 52 3.0 Bulk of material is friable, 30 pet hard lumpy along outcrop. Do. 8 NA .15 51 2.8-3.1 20 pet hard lumpy along outcrop, friable at depth. Most known in Hartley complex, mined by pits but not effectively by underground methods. 9 NA .10 50 2.8-3.3 Hard lumpy along outcrop, friable at depth. Has only been mined north of f^/ltoroshangu Pass. 10 NA .12 50 3.2 Hard lumpy along outcrop, friable at depth, limited data. Do. 11 NA .10 50 2.6 ....do Outcrops few, knowledge very scant. NA Not available. over a 500 km strike length, there will be differences from any tabulation that results. Individual economic . evaluations have attempted to take these differences into account. As an example of these differences, seam 5 is thin in the Selukwe and Wedza complexes (<0.07 m of solid ore) but has at least 0.10 m of solid ore in the Hartley Complex. The CrgOg grades shown in table 16 are estimates of weighted averages that were used in the economic evaluations. In terms of ore type, hard lump material in the chromium seams only occurs locally under two basic conditions: 1) in the immediate vicinity of thrust faults and 2) where groundwater circulation has modi- fied the matrix material (related to past and present water tables.) ^o It appears that below a vertical depth of 125 m or so, the only hard, lumpy ore to be en- countered will be found in the immediate vicinity of faults. For this study, it is estimated that only about 10 pet of the total Great Dyke seam material analyzed will be of the hard, lumpy type (>l-mm size grains) while the remainder is considered as friable (fines) with average grain sizes of about 0.2 mm. There have been many estimates of Great Dyke seam chromite resources. The first and foremost was by B. G. Worst (25), who included nine separate geo- logical maps covering the entire Great Dyke, along with cross sections at intervals of approximately every 3.2 km and longitudinal sections along the axes. As part of his study, he estimated the chromite resource to total about 296 million t of extractable material or 370 million t of in situ material, 65 pet being chemical- grade (seams 1, 2, and 3) and 35 pet being metal- lurgical-grade (seams 4-11). Only 9.5 pet of the total tonnage was located in the Wedza Complex, with near- ly 25 pet in the Selukwe Complex, and 65.5 pet in the Hartley Complex. His estimate was based on the out- crops of seams, projected to about 183 m on dip (only about 80 m vertical depth) except where seam thick- nesses were less than 0.076 m, in which case projection was only to 3 m on dip (open cast mining only). Worst noted at the time that the total in situ chromite resource probably would be more like 10 times his original estimate (nearly 3.7 billion t). Other pub- lished estimates of Zimbabwe's chromite resources in the Great Dyke seam deposits over the years have ranged from 50 million t of economically minable high- Fe chromite resources (26, p. 25), to 10 billion t of total in situ resources.^! Regardless of criteria, it is obvious that the tonnage present in the Great Dyke is enormous. It is estimated that maximum crude ore production in the late 1970's from seam deposits on the Great Dyke was only around 450,000 tpy. This would mean that 3.7 billion t of in situ resource would last for over 8,000 yr at late 1970's production levels. Since analysis of such a large tonnage would necessitate unrealistic assumptions as to development schedules and produc- tion levels, it was decided that analysis of availability would consist only of what were mentioned as produc- ing areas (sections) in the late 1970's or areas that were recent past producers and held promise for pro- duction in the near future. The sections comprising the demonstrated resource tonnage used in this study are shown in figure 15 as shaded areas over the Great Dyke outline. Table 17 lists these sections, the seams that outcrop, the demon- strated resource tonnage, weighted average grades, and amount of contained Cr^Og for each of these seams along that section. Each seam has been project- ed downdip for a length of 300 m (approximately 100 m vertical) and an in situ tonnage factor of 4 t/cu m was utilized. The resulting (cost evaluated) demon- strated resource of 175 million t of in situ material is located entirely within the bounds of the Hartley Complex. The relationship of this tonnage to Worst's estimate and the composition of the seam material is shown on figure 16. Although the cost evaluated ton- nage represents but a small fraction of this potential - > Confidential source. " Confidential source. 31 Table 17. — Estimated in situ cliromite resource data for selected Great Dyke, Zimbabwe, seam deposits as of 1980 Seams oresent Strike Seam Demonstrated Weighted-average Contained Identified Section name and description , ,. ^i„. „, length, thickness, resource, grade, Cr,0,, resources,' (o"toroPP'"9) Km 103 1 pctCrA 10^' 103 1 Gienapp- Ivo: BothlimbsofDyke, 10-kmsec.fromS. 16°55'toS. 9-11 8-20 0.10-0.125 6,480 50 3,240 16,880 17°0'. Impinge: Both limbs ot Dyke, 12-km sec. from 8.1 6°48' to S. 9-11 6-24 .10- .12 6,144 50 3,072 18,240 16°55'. Sutton-Rodcamp: West limb; 18-km sec, from Kildonan to S.17°30'. 4-10 15 .10- .15 15,480 50 7,740 76,440 Vanad: Both limbs; 3-km sec. from Ethel fault southwards. 6-10 2-6 .10- .15 4,032 51 2,056 12,984 Caesar: East limb; 4-km sec. from Caledonian northwards. 4-9 4 .10- .15 3,552 51 1,811 22,848 Crown-Divide North: East limb; 4-km sec. from S. 17°30' to 1 km south 4-9 4 .10-15 3,552 51 1,811 21,088 of Maquadzi. Glenapp-Hay-Noro: Both limbs; 7-km sec. from Ethel fault northwards 7-11 10-14 .10- .15 8,976 51 4,578 25,120 to 8. 17°0'. Umvukwes Area: West limb; 12-km sec. from Mtoroshangu Pass 5-10 12 .10- .15 10,944 51 5,581 53,856 southwards to Caledonian. Ore Recovery Tribute: West limb; 10-km sec. from Caledonian 5-10 10 .10-15 9,120 50.5 4,606 36,960 southwards to Kildonan. Greenvale: Eastlimb;8-kmsec. fromS. 17°30' toBrinsham. 5-9 8 .10- .15 6,144 51 3,133 36,672 Maryland: West limb; from 1 -km south of Maryland siding to 4-9 5-8 .10-15 6,384 51 3,256 38,768 point 8-km north. McGowan: East limb; 8-km sec. from Hunyani River 1,2, and 5 8 .12- .35 6,720 46.5 3,125 130,372 northwards to Darwendale. Divide: East limb; 8-km sec. from Divide mine northwards 4-10 8 .10- .15 8,256 50 4,128 45,696 to Brinsham. Rutala: East limb; 25-km sec. from Umfuli River 1 and 2 18 0.25 10,800 46 4,968 283,680 southwards to point 3.5-km north of Umsweswe River. Umsweswe: East limb; 3.5-km sec. from Umsweswe River 1 and 2 3 0.20- .27 1,974 46 908 37,940 northwards. Umsweswe-Bee: East limb; 25-km sec. from Ngezi River 1,2, 5, 6, and 7 14-24 .10- .28 20,808 47.5 9,884 228,960 northwards to S. 18°30'. Windsor- York- York West: Both limbs; 20-km sec. from Umniati River 5, 7, 8, and 9 14-40 .10- .15 14,040 51 7,160 33,840 southwards to S. 19°0'. Bat Claims: East limb; 8-km sec. from Umniati River 1,2, 5, and 7 8 .10- .28 6,912 47.5 3,283 28,800 northwards. Cambrai: East limb; 14-km sec. from Lalapanzi to 1,2, and 5 14 .15- .23 9,391 47 4,414 17,663 Bembezaan River. Netherburn: West limb; 21-km sec. from opposite Lalapanzi to 1,2,5 21 .15- .23 14,087 47 6,621 26,493 S. 19°10'. York: East limb; 4-km sec. from Sebakwe dam to S. 5 4 .15 734 50 367 1,224 19°0'. Sections costed NAp NAp NAp 174,530 49 85,520 1,195,000 Sections not costed^ NAp NAp NAp 543,083 49 266,111 3,228,000 Total or average NAp NAp NAp 71 8,000 49 352,000 4,423,000 NAp Not applicable. ' Identified tonnage equals demonstrated plus inferred tonnage. 2 This area includes the properties of Aver, Boots, Bridge, Chrome Interests, Frances, Great Dyke, Magundi, Maquadzi, Mdindi-Rose, Mount Chrome Claims, Otto, Pons, Rhochrome, Seymore, Yani, and Nyamenetsi. NOTE: Data may not add to totals shown because of averaging and independent rounding. tonnage estimate, it is important to note that this shown in table 17 are presently being mined. In actual tonnage itself would last for over 300 yr assuming a operations on the Great Dyke, when mining operations mining rate of 500,000 t of crude ore per year and a on the seam being exploited reach a point 300 m down- mining recovery of 90 pet. dip along the entire strike length of the section, a It must be remembered that not all of the seams decision could be made to proceed farther downdip on 32 I75xl06t cost evaluated (Hartley Complex) Composition, Great Dyke chromite seams S.TxIO^t Figure 16. — Composition of cost-evaluated Great Dyke seam material and its relationship to total potential in situ tonnage. that seam rather than develop the other unexploited seams. However, for this economic analysis, it was assumed that when the tonnage to a down-dip depth of 300 m is exhausted, new development will proceed to the next most attractive seam(s) or along strike on the same seam rather than extending the current operation to greater depths. An identified resource has been estimated for this study by extending the projections to downdip depths ranging from 300 to 2,000 m for (1) all seams con- tained within those sections (operations) analyzed at the demonstrated resource level, plus, (2) seams not outcropping but inferred to occur at depth on the sections cost analyzed, plus, (3) those sections of the Great Dyke not cost evaluated as demonstrated re- sources (nonshaded areas of figure 15) . These results give estimates of about 1.2 billion t contained within the cost evaluated sections and a total of 3.2 billion t contained in the noncovered areas, which results in a total in situ identified resource level of approximately 4.4 billion t, or 3.96 billion t of recoverable resource, slightly more than the 3.7 billion in situ tonnage Worst expected. However, numbers this large lose their relevance in light of the fact that, as already noted, a 3.7-billion-t resource would last on the order of at least 8,000 yr at present mining rates and recoveries. Selukwe Podiform Deposits The podif orm-type deposits of the Selukwe area have historically provided at least 40 pet of Zimbabwe's annual production since 1906. It is estimated that through 1979 total production from the District has been about 11.5 million t of chromite products. The Selukwe District abuts and is transsected by the western margin of the Great Dyke, as shown in figure 17. The total district covers a 30-km length (north-south) and a 7- to 10-km width (east-west). Within this area are 15 to 20 subordinate complexes comprising outcrops of ultramafic rock referred to as "slices." Only about eight of these complexes are of sufficient size and are proven to contain chromite bodies. These eight complexes are estimated to cover only about 40 sq km of the total 240 sq km comprising the entire District. Of these eight complexes, only three, Selukwe Peak, Railway Block, and Valley Chrome, have produced the vast majority of output over the years. The original peridotite sheets and lenses containing chromite were emplaced in the early Precambrian period nearly 800 million yr prior to emplacement of the Great Dyke. The geology of the district is very complex owing to multiple stages of folding, faulting, metamorphism, metasomatism, and intrusion (27). Regionally, the Selukwe District rocks and formations belong to the Selukwe Schist Belt, which consists of eight formations. The important chromite ore de- posits occur only in the talc carbonate, silicified talc carbonate, and silicified serpentine units in the Seluk- we Ultramafic Formation. An early study of the area (28) stated that homo- genous chromite ore bodies are irregularly distributed throughout the talc-carbonate and serpentine rocks and that the homogenous ore bodies took two forms: (1) irregular, rounded lenses up to 137 m in length and (2) long, narrow bodies with a veinlike outcrop and shallow downward extension. Since that time, much geologic investigation has been done in the District, including extensive surface and underground mapping and diamond drilling, especially during the years 1957-66. Following are short geologic discussions of what have been the most important chromite min- ing operations in the District over the years — Selukwe Peak and Railway Block. At Selukwe Peak, five ore zones occur over a strati- graphic thickness of 245 m (29). The lowest two zones (in relation to the ultramafic sheet) contain chromite of very low Cr203 content (<36 pet) and low Cr:Fe ratio (1.7). Zones 3, 4, and 5 contain high-grade material of >40 pet Cr^O., and Cr:Fe ratios >2. Zone 3 covers the main ore zone at Selukwe Peak. As of 1969, at least 25 ore bodies had been mined or were delineated at Selukwe Peak. These ore bodies occur sporadically over a strike length of approximately 2,500 m. The grade of material at Selukwe Peak is somewhat lower in terms of CrjOg and Cr:Fe ratio than at Railway Block. Supposedly, the main ore zone (zone 3) has been traced over the entire 5 km length of the Selukwe peridotitic-tectonic "slice", essentially double the length that had been worked as of 1969. Figure 17. — Location of chromlte ore bodies and mining operations, Selukwe Podlform District in Zimbabwe. According to Cotterill (29), the Railway Block property as of 1969 consisted of five separate zones: (1) the Friable Zone, (2) the Railway Block West Zone, (3) the Priority Zone, (4) the Central Zone, and (5) the Kinraids and Barbadoes Zone. Of all of the zones, the most important as of 1969 was the Priority Zone, where two large ore bodies plus several smaller ore bodies had been found and proved from the 116 m to the 305 m levels. The larger ore bodies were said to occur along 300 m of strike, with average thicknesses of 12 m and extensions to depth of nearly 50 m. Descriptions of other operations analyzed in the Selukwe District are shown in table 18. Generally, 80 pet of a lens deposit in the Selukwe District will consist of chromite grains ranging in size from 0.5 to 4 mm and is considered as lump ore. The other 20 pet will consist of disseminated, chromite grains ranging in size from 0.01 to 0.5 mm and is considered as fines ore. The Valley Chrome deposit, which is a large low-grade deposit, consists entirely of the disseminated fines-type of ore. An unpublished report of 1980,^2 estimated that there were 3 million t of high-grade, hard, lumpy ore and 1.5 million t of low-grade, hard, lumpy material available from the Selukwe District podiform deposits. Von Gruenewaldt (19) estimates that there is 1 mil- lion t available to a vertical depth of 150 m and a hypothetical resource of 76 million t available to a vertical depth of 1,200 m. The disparities arise be- cause of the erratic nature of podiform chromite deposits (ore bodies). In essence, as in all podiform occurrences (e.g., Turkey, the Philippines, etc.), it is virtually impossible to predict from surface occur- rences what will eventually be found at depth. How- ever, when it is noted that Zimbabwe Mining and Smelting Co. announced plans in 1981 to bring three new mines — Magazine Hill, Iron Ton, and Railway Block East — into production and to expand capacity at the Valley Chrome, Selukwe Peak, and Railway " Confldential source. 34 Table 18. — Ore bodies, ore type, and analysis of crude ore composition, Selukwe District operations-properties, Zimbabwe Analysis, uncleaned ore Operation-property and ore bodies-zones Ore type AIA MgO Cr:Fe ratio Railway Block: Priority Majority tump . Central . Friable . Railway Block West do Kinraids-Barbadoes — NA Selukwe Peak: 4A Majority lump 2A do Valley Chrome: Black Ore Disseminated, fines Blue Ore do Magazine Hill: Borehole M.H. 50 219.3 to 219.75 m. Iron Sides: Borehole I 64: 84.2 to 85.7 m 90.3 to 91 .5 m. Iron Peak do. Iron Ton do. 49.25 45.30 49.80 49.20 NA 45.80 49.45 39.70 42.20 Majority lump . ....do 5.02 5.96 3.22 3.60 NA 5.40 5.60 8.70 7.00 Majority lump 49.55 7.( 1 2.58 1 5.58 3.8 Two large ore bodies and several smaller ore bodies proved from 116-m level to below 305-m level. 1 1 .92 20.70 3.4 Concentration of ore bodies along 60-m of strike, starts at 1 60-m depth. 12.41 18.17 3.5 Bodies being mined are small and irregularly shaped (average less than 12,000 t). 12,00 18.05 3.5 Do. NA NA NA No substantial reserves proven as of 1969. 10.80 13.80 2.7 A "central "concentration of ore bodies occurring over 2,500 m strike 1 2.60 1 4.05 2.9 length. At least 25 ore bodies mined up to 1 969. 14.10 17.00 2.3 Large chromite bodies totaling several million t of disseminated, 15.20 16.80 2.7 high-magnesia chromite grains. 12.40 14.85 3.4 Zone 305 m long and 60 m wide, contains lenses 6 m thick. 43.60 7.10 13.80 16.34 3.0 Zone 610 m long and 30 m wide, contains lenses up to 10 m thick. 46.10 6.70 13.60 16.89 3.2 NA NA NA NA NA No available Information. Not cost-evaluated. NA NA NA NA NA Do. NA Not available. Block operations, then estimates of 1 million and 3 million t for the Selukwe District appear much too low (50, p. 40). Table 19 shows this study's estimate of demonstrated resource tonnages and grades for the Seluke District operations that are expected to make significant con- tributions to near-term production from the District. Also shown in this table are the geologic criteria used as the basis for the estimates. Because of the lack of up-to-date geologic information, especially in the cases of Magazine Hill, Ironsides, and Iron Ton, approxima- tions of geologic occurrence had to be made in order to estimate costs of production. It is probable that the estimated in situ demonstrated resource of 14,88 million t of chromite (table 19), will eventually prove to be a somewhat conservative tonnage for the Selukwe District. However, since the demonstrated resource tonnage already utilized a high degree of inference, it was impossible to estimate an inferred-level re- source on a property-by-property basis based upon the available information. As was the case for the Great Dyke, there are many different estimates of chromite resources in the Selukwe District podiform deposits. It is reasonable to expect at least as many ore bodies of sizes used in developing table 19 to be present throughout the District. Nevertheless, the question of depleting podiform resources in the Selukwe Dis- trict is an important one to the Zimbabwe chromite industry. Ore from these deposits has consistently accounted for 40 pet or more of Zimbabwe's production because it is the cheapest material to produce, it is mostly lumpy material (slightly cheaper and easier to smelt), and it is generally higher grade (higher Cr:Fe ratio) than the Great Dyke seam deposits. On average, the demonstrated resource of 14.88 million t would last about 21 yr assuming a 90-pct mining recovery and the capacities shown in the mining section of this report. For comparison, the 76 million t of hypothetical resource would last about 129 yr using the same assumptions. The importance of the Selukwe podiform deposits to Zimbabwe's chromium industry lies with the added cost per ton of ferrochromium that would Table 19. — Estimated In situ chromite resource data for selected Selukwe District podiform deposits of Zimbabwe, as of 1980 Demonstrated Weighted-average contained Operation-property resource, grade, ^, ^ ,-3, Criteria for tonnage estimates 10=t pctCrjOj ^^2^3' ^" ' Railway Block 4,600 49.0 2,254 Two ore bodies with strike lengths of 31 m each, thicknesses of 1 3 m each and extensions downdip of 215 m. Selukwe Peak 6,900 46.5 3,208 Three ore bodies with strike lengths of 1 20 m, 320 m, and 200 m, thicknesses of 20 m, 10 m, and 15 m, respectively, downdip extensions of 200 m. Valley Chrome 1 ,400 40.5 567 Published estimate of "several million tons" at start, minus estimated production from 1970 through 1979. Magazine Hill 660 49.0 326 Geologic "model" is 1 ore body 300 m on strike, 7 m thick, extending 80 m on dip. Iron Sides 660 45.0 300 Do. Iron Ton 660 45j0 300 Do. Total or average ... . 14,880 M6.5 6,955 NAp NAp Not applicable. ^ Weighted-average in situ grade at the demonstrated level. result from replacing Selukwe podiform output with Great Dyke seam material, as will be shown in subse- quent sections. Belingwe Podiform Deposits The Belingwe podiform deposits are located about 60 km south of the city of Belingwe. They were dis- covered sometime in the early to mid-1950's, and first production began in 1957 (31). By 1959, the District was producing 3 pet of Zimbabwe's chromite produc- tion. Because of its minor position in the Zimbabwe chromite industry and the generally sparse amount of information published during the last 20 yr on Zim- babwe, very few data are available on the geology, mining, production, or any other aspect of this Dis- trict. It is known that, as of 1978, at least two mines, Inyala and Rhonda, were in operation in the District (32) and that in the early 1970's a third operation, the Mlimo mine, was producing. The District is part of the Limpopo Schist Belt, also known as the Limpopo Mobile Belt or the Limpopo Metamorphic Belt. One description from 1959 (31) states that the chromium ore bodies occur within isolated, steeply dipping ultramafic "inclusions" in a granite country rock and that the ore bodies are separated within the ultramafic inclusions like "plums in a plum pudding." A second, more recent unpublished source^^ describes the occurrences only as small chromite lenses in a granulite gneiss environment. The vast majority of the chromitite available is of the hard, lumpy type although bodies of friable material are known. Indications are that the grade of Belingwe chromite ranges from 40 to 50 pet CrjOg with Cr:Fe ratios mostly <2.5. The Chamber of Mines article of 1959 (31 ) listed two grades of products : a high-grade, hard, lumpy ore of 47 to 50 pet CrgO,, 14.7 pet FeO, 12.5 pet AI2O3, and a Cr:Fe ratio of 2.7 to 3.0, and a low-grade, hard, lumpy ore of 45 to 50 pet CrgO-,, 20 pet FeO, 15.2 pet Al^Og, and Cr :Fe ratios of 2 to 2.3. Rough estimates of podiform resources in the Bel- ingwe District are only available from two sources. An unpublished source^* estimated the tonnage at 1 million tons, including 40 pet high-grade, lumpy material and 60 pet low-grade, lumpy material. Von Gruenewaldt (19) recently estimated a "hypothetical" resource figure of 13 million t for the Belingwe Dis- trict. As already stated in the discussion of Selukwe District podiform deposits, it is very difficult to esti- mate reserves and resources for podiform chromite deposits since ore at depth is only found in the course of underground development and exploration. Thus, there will be wide discrepancies in any estimate of chromite resources for a district containing podiform chromite deposits. Because of the lack of any detailed geologic data on the Belingwe District chromite deposits, it was neces- sary to construct models to analyze costs. For this study, it was assumed that there are at least three ore bodies present in the District, with dimensions com- parable to an average-sized ore body in the Selukwe " Confidential source. "Confldential source. District. Thus, the model consists of three separate ore bodies, each with strike lengths of 300 m, thick- nesses of 7 m, and extensions downdip for 80 m. The total in situ tonnage contained in the three model ore bodies would be about 2 million t (double the unpub- lished source's estimate but only 15 pet of Von Gruenewaldt's hjrpothetical resource estimate) at an average grade of 48 pet containing approximately 904,000 t of Cr^O;,. It is assumed for analysis that this demonstrated, in situ resource of 2 million t would consist of 50 pet hard, lumpy ore and 50 pet of fines or lower grade material that should be beneficiated by gravity methods. At the total estimated production capacity for all operations in the District of about 30,000 t of ore, the demonstrated resource of 2 million t should last for 60 yr. However, this result is based on rough estimates and should be further enhanced by future data col- lection. Eluvial Chromite Deposits For years in Zimbabwe, residual deposits of chromite grains in soil were viewed as a possible source of chromite production. The first attempts at production from soils were begun in the early 1950's, and for a 5-yr period (1952-56) declared output of chromite concentrate from eluvial deposits was 103,000 t (25) . By the late 1950's three plants in operation in the area north of Mtoroshangu Pass were treating chromite soils using a magnetic separation-flotation process. However, by 1976 only one plant was still in operation, Zimbabwe Mining and Smelting Co.'s Impinge plant, and the flotation process had been abandoned. The eluvial deposits are residual concentrations of chromite grains in soils resulting from the weathering of the chromite seams and surrounding rocks. The residual concentrations tend to be best in flat, poorly drained areas in the most mountainous (elevated) areas along the Great Dyke. The soils consist mostly of chromite, magnetite, and hematite with average chro- mite grain sizes of 0.2 to 0.3 mm. The process of resi- dual concentration results in overall lower Cr:Fe ratios than would be found in the parent chromite seams. This occurs because the overall iron content in the soil is higher and it is difficult in processing to com- pletely eliminate the additional iron. Because of this, the best chromite soils deposits from a resource grade standpoint will be those derived from seams with Cr: Fe ratios >2.8 (essentially seams 4-11 on the Great Dyke) . All of the producing operations so far have been located within the section of the Great Dyke from Mtoroshangu Pass northwards to the Gurungwe Fault in the Hartley Complex, which Worst (25) considered the best area. The sole operating mine in 1976 reported that the soil thickness at their operation varied from 0.12 to 1.8 m thick with an average of 0.45 (33) and that 95 pet of the recoverable chromite was in the minus 0.5-mm soil fraction with the remainder in the form of pebbles in coarser material near the parent seams. Based on published production rates and assumed grades of concentrates and mill recovery, it is esti- 36 mated that the average feed grade of soil to the plant was 20 pet Cr^Oa with ranges probably from 10 pet to 40 pet. Only one estimate of eluvial chromite resources in Zimbabwe is available — that made by Von Gruenewaldt in 1981 (19). He estimates a total of 54 million tons, which presumably is the tonnage of soil available. The criteria behind the estimate are not known. A comprehensive, detailed survey of suitable eluvial de- posits along the entire Great Dyke is not known to have ever been conducted. Thus, the 54 million ton resource estimate is not "locatable." Because of that, it was decided that the demonstrated resource of eluvial chromite soil in Zimbabwe to be cost evaluated in this study, should consist solely of those operations known to be recently in production. Hence, the Zim- babwe Mining and Smelting Co.'s Impinge operation is the only eluvial operation evaluated in this study as constituting a "demonstrated resource." The demonstrated resource of eluvial soil remaining as of 1980 for this property is estimated to be around 4.7 million t at an average grade of 20 pet CrgO., with a Cr:Fe ratio of 2.2 and containing approximately 950,000 t of CrgOg. The resource tonnage was estimated based on the assumption that mineralization of appro- priate thickness (average of 0.45 m) is found over 800 ha of area, utilizing a tonnage factor of 2.3 t/cu m and includes subtractions of an estimated 3.6 mil- lion t of soil extracted from 1968 through 1979. The demonstrated resource tonnage would have an approxi- mate production life of nearly 16 yr at a production rate of 300,000 tpy of soil treated (50,000 tpy of con- centrate produced) and would result in approximate total production of 830,000 t of concentrates. It is highly probable that as much as 54 million t of eluvial chromite soil exists throughout the 300,000- ha area covered by the Great Dyke. However, even this large a tonnage would only produce about 9.5 million t of concentrates, and the economics of this total tonnage are impossible to analyze without the ability to specify the exact areas where it occurs or details of occurrence specific to that location. In summarizing the eluvial chromite resources in Zimbabwe, three points should be stressed. First, the technology for extraction and production of market- able concentrates does exist. Second, there are too many operational unknowns to determine whether economic production of concentrates from the hypo- thetical 54-rnillion-t resource is possible. Third, a comprehensive and detailed survey of the Great Dyke area must be accomplished before attempting to esti- mate the total chromite resources that would be avail- able from eluvial chromite soils in Zimbabwe. Table 20 and figure 18 summarize the in situ demonstrated and identified resources of chromite- bearing material in Zimbabwe estimated according to the criteria of this study. The in situ demonstrated resource tonnage of 740 million t is comprised of 97 pet from seam deposits on the Great Dyke, 2.3 pet from podiform deposits in the Belingwe, Mashaba, and Selukwe districts, and 0.7 pet from eluvial chromite soils. Of the total in situ identified resource tonnage of 4.574 billion t, fully 97 pet is also from the seam deposits on the Great Dyke. Table 20. — Summary: in situ demonstrated and identified resources of chromite in Zimbabwe, by type of deposit Weighted- Contained Identified Demonstrated average grade, CrjOg, resource,' Type of deposit resource, 1 0^ t pet CRjOj 1 0' t 1 0^ t Seam deposits, Great Dyke: Costed ^175,000 49.0 85,520 ^1, 195,000 Not costed "543.000 49.0 266,111 ^,228,000 Total. Podiform deposits: Selukwe .... Belingwe . . . Mashaba . . . Total Eluvial chromite soils Total, or average, all deposit types... 740,000 49.0 360,620 4,574,000 ' Identified tonnage equals demonstrated plus inferred tonnage. ^ Calculated for producers or recent producing sections only to a downdip extension of 300 m. ^Calculated for producers or recent producing sections to downdip extensions of tietween 300 and 2,000 m. * Calculated for all other sections not in recent production to a downdip extension of 300 m. Not cost evaluated. 'Calculated for all other sections not in recent production to downdip extensions of between 300 and 2,000 m. 8 Von Gruenewaldt (J9). ^Unpublished (confidential source) — not cost evaluated in the study; production effect basically nil. ° Estimated for the study; see text for description. 718.000 49.0 351.631 4,423,000 14.900 2.00C ' 400 46.5 48.0 45.0 6,955 904 180 «76,000 M 3,000 6 8,000 17,300 46.5 8,039 97.000 8 4,700 20.0 950 '54,000 Demonstrated resource 740xl06t Figure 18. — Distribution of demonstrated resource level, by type of occurrence, In Zimbabwe. MINING Mining of chromite ore in Zimbabwe consists of three major types — underground resue mining of seam deposits on the Great Dyke, underground sublevel stoping of podiform deposits, and surface mining of the eluvial-type deposits. Each type is discussed sep- arately in the following sections. Great Dyke Seam Deposit Mining — Resue Mining By the mid to late 1940*s, mining of chromium seams on the Great Dyke had progressed, by necessity, from 37 "pig-rooting" (surface mining of seams along outcrop to shallow depths) to underground methods. The basic underground mining method now in use is called "resuing". In this method, a stoping width (vertical height) of 0.9 m is usually established. From 0.1 to 0.30 m of this width will consist of the chromite seam, with the remainder pyroxenite or serpentinite waste rock. Blast holes are usually drilled with electric "coal" drills (less often with jackhammers) . The blast holes are put into the relatively soft waste rock at sufficient distances from the chromite seam so that the seam will not be disturbed by blasting. After blasting, the waste rock is removed from the stope by hand-lashing. As much of the waste as possible is packed into stoped- out areas for support, and the remainder is wheeled or scraped, then railed and hoisted to the surface. After all of the waste has been removed from above the chromite seam, crowbars, hammers and chisels, pneumatic drills, or even light blasting are used to remove the chromite seam. Where the ore is friable and the seam is not "frozen" to the footwall, the chromite seam can be lifted out using only crowbars, hammers and chisels, or even by hand. This tjT)e of occurrence is the case in the majority of seams. The ore is next transferred to footwall drives, either by box-type winch scrapers or by wheelbarrow, while haulage in footwall drives to the shafts is usually by small electric or diesel locomotives hauling 3- to 4-t cars. It should be noted that modifications to the basic resue mining system are constantly being made and vary from mine to mine. This study assumes no dilution and mining recover- ies in the range of 85 to 90 pet. In actual operations, great care is taken throughout the mining process to minimize the effect of dilution from serpentinite or pyroxenite waste rock. Scrapers, railcars, and skips are carefully cleaned after use in transporting waste, and scraper paths are swept clean after waste scraping and prior to ore scraping. Reported mine recoveries have ranged from 75 to 95 pet. Losses occur mostly through ore left in support pillars that are not re- claimed. The highest recoveries are attained with methods that include reclaiming of support pillars with consequent total filling with waste rock. As of 1975, a rule-of-thumb estimate for resue min- ing was that in order to produce 1 t of salable chro- mium ore, about 3.7 t of waste and 1 t of ore would have to be hoisted to the surface (Si). In addition, 1.9 t of waste would have to be packed back into the stopes if standards of the 1950's (35) , in terms of the percentage of waste hoisted versus the percentage of waste packed, still applied. With the trend being to improve support by completely filling stoped-out areas with waste, it is not unreasonable to expect that at least 50 pet of the total waste rock broken now goes into support, with the remainder needing to be hoisted to the surface. This analysis assumes that in operations where the chromite seam thickness is 0.10 to 0.15 m, 50 pet of waste is packed and 50 pet is hoisted, chang- ing to 60 pet packed and 40 pet hoisted for mining of seams with thicknesses in the 0.20 to 0.25-m range. It should be noted that at no time in the history of chromite mining on the Great Dyke have seams with thicknesses of 0.05 m or less been mined underground for a significant length of time and that none of the seams herein analyzed are that thin. In areas of high relief, generally north of Mtoro- shangu Pass, access is mostly by adits in combination with internal inclined shafts (36), while mines in low relief areas, generally south of Mtoroshangu Pass, must utilize inclined shafts for access. Adit entry has several advantages over inclined shaft entry in addi- tion to the initial development costs being less. Adits provide self -drainage for the workings during the wet season, whereas inclined shaft systems generally re- quire pumping. Ventilation is also less costly and less complex with adits, and it is also possible at some operations north of Mtoroshangu Pass to mine more than one seam from one basic access, although this is the exception rather than the rule along the Great Dyke. Although there have been a few small vertical shafts sunk for operations on the Great Dyke, generally, vertical shafts are not chosen for initial mining (less than 200 to 300 m on dip) because there is a lead time before obtaining production, while an inclined shaft system can provide immediate production, essentially simultaneous with development. Capacities of individual inclined shaft systems range from about 10,000 to 30,000 tpy of crude ore, while individual adit systems are estimated to have capacities of 10,000 to 20,000 tpy of crude ore. Capa- cities higher than 30,000 tpy of ore are not utilized for two reasons. Chromium ore is a product that suf- fers from markets that are often unfavorable, so that high capital cost layouts are not recommended unless there is a sure market at all times (Si) ; and an operation producing 60,000 tpy of ore will mine out a block of nearly 12 ha in a year, which equates to an advance downdip of about 130 m/yr for one inclined shaft system, and is an excessively high extraction rate. Because of the many variations possible, it was necessary to construct several mining models to esti- mate costs for economic analysis. The models used, and associated capital and operating cost estimates for the mining units, are shown in table 21. Six inclined shaft models with capacities ranging from 10,000 to 30,000 tpy of crude ore and two adit models with capacities of 10,000 to 20,000 tpy of crude ore were utilized. Each unit is intended to service 1,000 m of strike length to a downdip depth of 300 m. The assumption was made that at no point can two seams be mined from a single access unit. Thus, when the 300 m limit is reached, a totally new access system must be developed to mine another seam or to mine the same seam for a second 1,000 m strike length. Ex- ploration costs prior to development are not shown in table 21 because they were assumed to be negligible, consisting of examination and sampling of "pig- rooted" outcrops to determine if the width of the seam is consistent over at least 650 m of strike length. As shown in table 21, capital cost requirements are very low. Mine equipment costs range from $200,000 to $600,000, while mine plant costs range from $500,000 to $1.1 million in 1981 U.S. dollars. The total cost for development of a 300,000 sq m block is estimated to range from $1.4 million to $1.8 million. In general, 38 Table 21. — Capital and operating cost estimates; generic mining models of Great Dyke seam mines Mining model description^ Capital costs (thousand 1981 U.S. dollars) Access method ^fP^'J'' °Shaaref Mine equipment Mine plant Mine operating cost (per metric ton of ore) by seam thicl 23° Dip < 23° Dip > 23° Dip < 23° Dip > 23° Dip < 23° Adit Adit $1,800 1,600 1,800 1,600 1,800 1,600 1,400 1,500 $200 200 400 400 600 600 200 400 $500 500 700 700 1,100 1,100 500 500 $91.0 91.0 96.0 96.0 78.0 78.0 86.0 77.0 $68.0 68.0 72.0 72.0 59.0 59.0 65.0 58.0 $56.0 56.0 59.0 59.0 48.0 48.0 52.0 51.0 Mining method: advance-retreat resuing (scrapers). Table 22. — Comparison of mining cost differences due to changes In seam thickness Seam thicl 100,000 t of in situ resource) employ the larger scale, lower cost sublevel stoping method. Since all of the Selukwe and Belingwe podiform demonstrated resources evaluated in this study are assumed to be contained in lenses (ore bodies) with > 100,000 t of ore the only mining method utilized in this analysis is the large scale, sublevel stoping method. Over the years, access methods in the Selukwe District have involved many combinations of adits, vertical shafts, and inclined shafts. In general, deeper levels are accessed with high-capacity vertical shafts, while near-surface levels utilize numerous adits if the topography allows it. Each of these main access sys- tems also uses internal inclined shafts (winzes) for subsequent development, depending upon the circum- stances encountered. The sublevel stoping method is basically a caving method. It requires driving of a main haulageway from the adit or shaft connecting with subordinate haulage drives running parallel to the long axis of the ore body (lens) to be mined. Main haulage levels are usually established at 50- to 60-m vertical intervals, while sublevels are established approximately every 12 m. Haulage cross cuts are driven along the short axis of the ore body at about 10-m intervals and ore pass raises with cone shapes of 10 m diameters are established from the haulage cross cuts to a sill level 7.5 m above the cross cut. Long-hole drilling proceeds from benches cut on each sub-level, with the lower level stope in advance of the next highest. Broken ore is loaded directly from ore pass chutes into rail cars pulled by battery locomotives. The ore is delivered to underground grizzleys which at Selukwe Peak are set at 150 mm. Little support is required and mine re- coveries are high, estimated to average 90 pet; how- ever, there is little control over the grade of ore being mined. Underground mining productivities are high relative to many other chromite mining operations around the world, estimated to be about 2 t of ore per underground workershift. Overall productivity (sur- face plus underground laborers) is somewhat lower, at 1.33 t per workershift. These productivities are more than 3 times higher than those attained in Great Dyke seam mining, and the advantage shows up in much lower crude ore mine operating costs, around 66 pet lower on average. Estimated crude ore mine operating costs for the Selukwe podiform operations range from $18.70/t to $28/t of ore. Of these costs, about 30 to 35 pet repre- sents labor costs, 50 to 55 pet is composed of materials and supplies, and only 15 pet is attributable to equip- ment operation. Mine equipment replacement costs are estimated to range from $10/t to $17/t of annual crude ore capa- city. Mine plant replacement costs are estimated to range from $29/t to $55/t of annual crude ore capa- city. In general, a 30,000-tpy, sublevel stoping, podi- form mining operation in Zimbabwe should cost about $2.5 million to bring into production, assuming that the ore body is at a depth of 100 to 150 m below the surface and is accessed by vertical shaft. Eluvial Soil Deposit — Level and Hillside Stripping The most recent description of the Impinge eluvial soil operation was given by Kimble {33) in 1976. The mining practice at that time consisted of pit sampling on a grid system to determine the quantity of soil and recoverable chromite content available in future bar- row pits. A mining schedule for various combinations of pits was then drawn up, based on keeping the grade of feed to the mill constant and the haulage distance from the various pits as consistent as possible on a ton-kilometer basis. The pits to be mined are delineated by surveying, and perimeters are scored by a road- grader. Drainage ditches are cut with a bulldozer, and the vegetation is either burned off or stripped with the grader. The soil, ranging in thickness from 0.12 to 1.8 m thick (averaging 0.45 m), is bulldozed into windrows laid out on contours to prevent runoff of silt during the rainy season. The soil is then loaded by front-end loaders into 15-t-capacity dump trucks for haulage to the mill. It appears that the maximum haul distance involved is 4 km, with an average of 2 km. The soil is excavated until rubble or bedrock begins to show, at which time mining is halted. Rehabilitation consists of ripping the pit floor on contour to a depth of 0.3 m at 1-m intervals, constructing mounds of soil at 30 m intervals and reseeding. In 1976, all mining and transport of soil was done by contractors at the Impinge operation. The capacity of the operation was very flexible since the mill could handle anjrwhere from 180,000 to 400,000 tpy of soil feed without any effect on costs or operations. This study's evaluation was made assuming a capacity of 300,000 tpy of soil feed, essentially halfway between the two extremes. Also, the analysis has been made as if the company had to make all capital investments and conducted its own mining rather than on a contractor basis. The estimated mine operating cost for the eluvial soil operation is $4.78 per ton of soil delivered to the mill. It is estimated that direct and indirect labor costs comprise 30 pet of the total cost, 64 pet is for equip- ment operation, and 6 pet for materials and supplies. Assuming a concentration ratio of 5.7 t of soil to produce 1 t of concentrate, the above mining cost represents a cost of $27.24/t of concentrate produced. Capital items for mining consist of exploration, mine equipment, and mine plant. It is estimated that a 25-ha block of soil would require about $450,000 for exploration and that a 300,000-tpy (of soil) operation would require about $2.3 million in mine plant and equipment capital costs. BENEFICIATION Great Dyke Seam Deposits Prior to 1950, the only beneficiation, other than hand-sorting, done on Zimbabwe chromite ores was gravity concentration at those few operations mining disseminated ore (,35) . By 1960, nearly half of the 34 major operations described by Worst {25) had in- stalled gravity concentration plants to upgrade their products. Generally, high-grade ores (>50 pet CrjOg Cr:Fe =» 3) do not need to be upgraded except for hand-sorting. This is the case for ores of either the hard, lumpy type or of the friable type. Gravity concentration is used solely to improve Cr^Os contents and, if possible, Cr:Fe ratios. For hard, lumpy ores of coarse chromite grain sizes (>8 mesh or 2.38 mm) hand-picking of waste or heavy-media separation are all that are required. However, heavy-media separation is very uncommon in Great Dyke seam operations. Friable chromite ores of fine chromite grain sizes (<8 mesh or 2.38 mm) most often will be beneficiated by gravity methods because the material is already in a "fines" form and increasing the grade is not expensive or complex but could significantly improve marketability. However, as noted, if the grade of Cr20., and Cr:Fe ratio are high enough, it is not really necessary to beneficiate the friable material. 40 The hand-sorting process is self-explanatory and the heavy-media process will be described in the discussion of beneficiation methods for podiform deposits. The gravity-separation methods in use on the Great Dyke comprise various combinations of the following major operation : grizzly screening, crushing with jaw crush- ers or hammer mills, screening with vibratory or trommel screens, recrushing with small rod mills, classification and reclassification by hydraulic methods, gravity separation with jigs, spirals, and tables, and dewatering and desliming. All flowsheets include at least two stages of gravity separation, either jigging followed by tabling or spiral separation followed by tabling. For friable, fines material, liberation of chro- mite grains occurs at minus 8 mesh; however, strict control of sizes is needed throughout the process be- cause most of the chromite losses occur in slimes, hence the need for multiple-stage screening and classi- fication. Recoveries of CrgOa in gravity concentration are estimated to be in the range of 75 to 85 pet, while recoveries in hand-sorting should run to 100 pet. This study assumes 75 pet recovery of Cr203 for any ma- terial going through gravity separation and 100 pet where it is considered that only hand-sorting would be required. As noted in the geology and resources section, it is estimated that only about 10 pet of the total in situ, demonstrated resource analyzed for the Great Dyke sections-operations consists of hard, lumpy ore with the remainder as friable, fines material ; and that seam 4 constitutes the greatest possible source for hard, lumpy material at depth. Because seams 1 and 2 have the lowest CrgO, grades (46 pet) and Cr:Fe ratios (1.4 to 2.3) of all seams on the Great Dyke (table 23), it was assumed that all sections-operations analyzed where those seams constituted the majority of the re- source would have to send 100 pet of their mined material through gravity concentration. Since seams 9 and 10 have the highest Cr:Fe ratios, those proper- ties where seams 9 and 10 predominate were assumed to require beneficiation only by hand-sorting. Seams 3 through 8 are intermediate to high in Cr203 content and Cr:Fe ratio, thus section-operations containing these seams predominantly were assumed to require a combination of hand-sorting and gravity separation. Table 23 summarizes estimated recoveries and bene- ficiation operating costs for these three categories. The entire output of chromite products (lump, fines, and concentrates) estimated to come from the 21 properties cost evaluated for the Great Dyke have >50 pet CrgO., and should have Cr:Fe ratios ranging from 2.5 to 3.3. This is because all in situ ore below 50 pet Table 23. — Estimated beneficiation methods, recoveries, and operating costs, by category of Great Dyke seam Predominant Beneficiation CrjOj recovery, Operating cost, seam method pet $/t ore feed 1 and 2 Gravity 75 2.50 3 through 8 Gravity and hand 80-90 1.25-2.00 sort. 9 through 11 Hand sort 1 00 1 .00 CrjOg has been assumed to undergo beneficiation by gravity methods. Of the total Zimbabwe chromite product output, it is estimated that roughly 10 pet would be in the form of lump ore and the remainder in the form of friable-fines ore or as concentrates. For purposes of analysis, a cost of $1 per ton of feed has been estimated for hand-sorting and includes the costs of screening, sorting of ore, and transport of waste. It is composed predominantly of labor costs, estimated to comprise 85 pet of the total cost, while materials and supplies account for only 5 pet, and equipment operation 10 pet of the total cost. Personnel requirements for hand-sorting are difficult to deter- mine. For this study it is estimated that a 12,000-tpy operation would require about 30 laborers for hand sorting of crude ore. The operating costs for a typical gravity-separation plant are estimated to be $2.50/t of ore feed. This typical gravity-separation plant requires crushing, grinding, screening and classification, and two-stage gravity separation with jigs and tables. It is composed of 45 pet labor costs, 28 pet materials and supplies costs, and 27 pet equipment operations costs. Capital costs for both extremes are relatively small. It is estimated that capital costs for a hand-sort operation plant should range from $10/t to $15/t of annual feed capacity and a typical gravity-separation plant should range from $14/t to $20/t of annual feed capacity. The technical assumptions of this study result in an overall concentration ratio for the 21 Great Dyke seam operations evaluated of 1.2 t of feed to product 1 t of chromite product (lump, fines, and concentrate). The overall weighted-average milling cost for all 21 opera- tions is $1.60/t of ore feed or $1.92/t of chromite product. The mill operating cost is an insignificant portion of the total mining plus milling cost since, on a chromite product basis, it represents only about 2 to 4 pet of the total mining plus milling cost. Podiform Deposits According to the Chamber of Mines Journal of July 1959 (31), three basic products were being produced from Selukwe podiform deposits in the late 1950's: (1) a high-grade, hard-lump ore of 47 to 48 pet Cr^Os and a Cr:Fe ratio of 3 to 3.2; (2) a refractory-grade, hard-lump ore of 38 to 40 pet CrgOg and a Cr:Fe ratio of 2.1 to 2.4; and (3) a low-grade, hard-lump ore of 45 to 46 pet Cr^Og and a Cr:Fe ratio of 3 to 3.2. The same source listed two products from Belingwe podi- form deposits: (1) a high-grade, hard-lump ore at 47 to 50 pet Cr^Og and a Cr:Fe ratio of 2.7 to 3.0 and (2) a "chemical-grade" ore of 45 to 50 pet Cr^Og and a Cr:Fe ratio of 2.0 to 2.3. Referring back to the discussion of Selukwe podi- form resources shows that of the six properties evalu- ated, five (Selukwe Peak, Railway Block, Magazine Hill, Ironsides, and Iron Ton) are estimated to have re- sources composed 80 pet of lumpy material with grain sizes ranging from 0.5 to 4 mm, and 20 pet of fines material with grain sizes ranging from 0.01 to 0.5 mm, while one (Valley Chrome) is composed entirely of the 41 fines material. Reference back to the discussion of Belingwe resources shows that this study assumes that 50 pet of the demonstrated resource at Belingwe is hard, high-grade lump material and the other 50 pet is low-grade ore that would probably require bene- ficiation by gravity methods. For properties in the Selukwe District with 80 pet lump and 20 pet fines material, the beneficiation methods are hand-sorting and heavy-media separation for lump material, and gravity separation with spirals and tables for the fines material <0.5 mm in grain size. The Valley Chrome operation utilizes gravity separation with spirals and tables for all of its feed, while the Belingwe operations require only hand-sorting for 50 pet of their material and gravity separation with spirals and tables for the other 50 pet. It is not known exactly how many mills are present in each district, where they are located, or what the capacities are. There has been a mill situated near the Valley Chrome operation since the late 1950's and a heavy-media separation, gravity-separation process milling complex is located in the Selukwe District. The description of methods used at the Selukwe mill is that a minus 150-mm, plus 60-mm fraction is hand- sorted; a minus 60-mm, plus 6-mm fraction goes to a heavy-media separation plant (sink-float process) ; a minus 6-mm, plus 0.5-mm fraction goes to a heavy- media separation plant using cyclones, and the minus 0.5-mm fraction goes to a gravity-separation section using spirals and tables to produce concentrates. The hand-sorting and heavy-media separation processes produce lump ore. The Magazine Hill, Iron Ton, and Ironsides operations that are proposed for production are assumed to require hand-sorting and screening of 50 pet of the feed and two-stage gravity separation for the other 50 pet of feed. Estimated recoveries used for analysis are 100 pet for hand-sorting, 95 pet for heavy-media separation, and 80 pet for gravity separation. Mill operating costs are estimated at $3/t of ore feed for hand-sorting plus heavy-media separation, $2.50/t of ore feed for gravity separation with spirals and tables, and $l/t of ore feed for a simple hand-sort. For heavy-media separation plus hand-sorting, labor costs are estimated to make up 55 pet of the total cost, while 25 pet is for materials and supplies, and 20 pet is for equipment operation. The above recoveries and operating costs have been weight-averaged according to the proportions appro- priate for the property being evaluated. For economic analysis, the mill operating costs in- clude estimated costs for transport to what are assumed to be centralized mill complexes. The esti- mated transport costs for the seven podiform opera- tions analyzed ranged from $2/t to $3.25/t of ore feed. Thus, the costs for transport to the mills plus milling itself ranged from $4.95/t to $5.47/t of ore feed or $5.57/t to $6.19/t of ehromite product. On a product basis, this cost represents about 16 pet of the total mining plus milling cost for the podiform deposits. Estimated capital costs for a combination hand-sort heavy-media plant are estimated to be about $18/t of annual ore feed. Eluvial Deposits As of 1976, milling practice at the Impinge eluvial operation consisted of washing and screening (2 mm) , classification, screening, magnetic separation (wet), and gravity separation with jigs and spirals. There were five different stages of classification in the flow- sheet. The oversize material from initial screening (plus 2 mm "pebbles") was hand-sorted on a waste conveyor to produce about 5 pet of the recoverable ehromite. No concentrate grades or recovery values were given in the 1976 description (36) . It was men- tioned, however, that when operating on a 3-shift-per- day, 30-days-per-month basis (maximum capacity) that the mill could produce 6,000 t per month of con- centrates and, if required, could operate on a one-shift- per-day, 30-days-per-month basis (minimum capacity) to produce 2,500 t per month of concentrates. It is probable that the concentrate grade was at least 50 pet CrgOg and could have exceeded 52 pet or more. This study assumed a concentrate grade of 52 pet CraOs for evaluation. Recovery for economic analysis was estimated to be very low at only 45 pet of the contained CrgO,. This low recovery was assumed for three reasons. First, concentration ratios for other soil operations of the 1960's were greater than 5 t of soil per ton of concentrate. Second, the process has as its overall aim the improvement of Cr:Fe ratios (through magnetic separation), which would probably result in greater loss of chromium along with iron. Third, the amount of slimes waste will be much larger than usual, resulting in more chances for loss of chromium. The operating cost for the eluvial soil operation is estimated to be $2.78/t of soil feed. Labor costs are estimated to comprise 45 pet of the total cost, while materials and supplies account for 30 pet, and equip- ment operation for 25 pet. Since no crushing or grind- ing is required, the operating cost is slightly less than would normally be expected for a magnetic-separation, gravity-separation plant. In 1976, Kimble (55) noted that the total operating cost remained static no matter at what capacity the mill was operaing. Because of the rather complex flowsheet, the esti- mated capital cost for a plant of this size (300,000 to 400,000 tpy of soil) would be in the vicinity of $5 million, relatively expensive for a ehromite beneficia- tion plant. CHROMITE AVAILABILITY There are two major issues to be addressed when evaluating the availability of chromium from Zimbab- we. First, there is the issue of ehromite production from the podiform resources versus ehromite produc- tion from the seams of the Great Dyke. Secondly, there is the general issue of chromium available in the form of ehromite products versus chromium available in the form of ferrochromium products. This latter issue, dealt with in the section on ferrochromium availability, is of particular importance since it is the stated ob- 42 jective of the government to use all of its domestic chromite resources for the production of ferrochro- mium. This section discusses the relative cost and availability of chromite from the podiform and Great Dyke seam deposits. In 1980, Zimbabwe's total prodution of chromite ore and concentrates was about 550,000 t {37, p. 1147) . Of this, it is estimated that 50 pet came from operations in the Selukwe Podiform District, 45 pet from opera- tions working seams on the Great Dyke, and 5 pet from other operations. The 1980 production level repre- sented a 36-pct decrease from 1976 production of about 860,000 (57, p. 1147). Aggregate production figures for 1981 show a further decline to around 500,000 t (55, p. 466). The two major producers of chromite and ferro- chromium are Zimbabwe Mining and Smelting Co. (formerly African Chrome Mines and a subsidiary of Union Carbide of the United States) and Zimalloys (formerly Zimbabwe Alloys and before that Rhodall Ltd.). These two companies represent ownership of a majority of the operating chromite mines in Zimbab- we. During the past few years, there have been numer- ous, often contradictory, claims concerning current mining capacity and future expansion plans. However, as is the case with the mines of South Africa, actual mining capacity is not the issue; the operating mines or those temporarily closed can relatively easily and quite significantly increase mining and milling capa- city. The issue is one of demand for Zimbabwean chromite and the availability of sufficient factor inputs such as labor, transportation, and (for chromite smelted in-country) energy supplies. With this in mind, this study assumed that within a 3- to 4-yr period the mining operations evaluated could attain a crude ore production level of approxi- mately 1.4 million tpy, yielding a mill output of chromite products totaling approximately 1 million tpy. It must be stressed that these figures are similar to those given in the various informational sources addressing the issue of chromite mining capacity ex- pansion, are easily attainable given the extraordinary flexibility of the chromite industry, and are in keeping with announced ferrochromium smelting capacity ex- pansions. Table 24 lists the names, deposit types, annual crude ore and chromite product capacities, and estimates of the productive life of the recoverable demonstrated resources. Figure 15 shows the location of the opera- tions evaluated, railroad lines and transportation routes, and ferrochromium smelters. A few points con- cerning table 24 are evident. First, the major produc- ing podiform operations, Selukwe Peak and Railway Block, have very large capacities relative to the Great Dyke seam operations. These latter operations typic- ally range from 15,000 to 30,000 tpy of crude ore, with only 5 of the 21 operations in the 40,000- to 60,000-tpy range. These seam-mining capacities are quite small relative to the operations in South Africa, primarily because in Zimbabwe the chromium seams are much thinner than those of the Bushveld Complex. Given the relatively small capacities of the seam operations and the enormous availability of in situ chromite resources of the Great Dyke, the estimated Operation-section Crude ore Chromite Estimated life capacity, production of recoverable lO^t capacity, resources, yr 10^1 (1981 on) Table 24. — Estimated annual capacities of crude ore and chromite products from selected Zimbabwe chromite operations action Great Dyke seam: Glenapp-lvo 10 10 517 Impinge 20 20 245 Sutton-Rodcamp 36 34 343 Vanad 42 39 76 Caesar 42 39 67 Crown-Divide North 20 18 141 Glenapp-Hay-Noro 30 28 238 Umvukwes area 60 46 145 Ore Recovery Tribute 40 37 181 Greenvale 20 18 245 IVIaryland 20 18 254 McGowan 15 13 357 Divide 15 13 439 Rutala 20 13 431 Umsweswe 25 17 62 Umsweswe-Bee 30 17 554 Windsor- York-York West . . 20 18 561 Bat Claims 15 10 368 Cambrai 36 24 208 Netherburn 48 32 234 York 15 14 38 Selukwe podiforms: Railway Block 160 139 25 Selukwe Peak 190 169 32 Valley Chrome 60 48 20 f\/lagazine Hill 30 27 19 Ironsides 30 27 19 Iron Ton 30 27 19 Belingwe Podiform: 27 23 62 Eluvial: Impinge 300 53 15 Total 1,406 991 (') ' Average life of Great Dyke seam mining operations: 272 yr; average life of podiform mining operations: 28 yr. mine lives are very large indeed, with an average seam resource operation life of 272 yr. This compares to an average podiform resource life of only 28 yr and points to a very significant long-term change in store for the chromium industry of Zimbabwe. As mining pro- gresses into the next century, an increasing percentage of chromite output will have to come from the Great Dyke seam operations. Table 25 addresses the differences in mining, processing, and transportation costs for the two resource types, as well as total chromite availability. As is evident, mining costs for the podiform resources on a per-ton-of-chromite-product basis are markedly lower, by $55, or 65 pet on average, than for the Great Dyke seam operations. Milling costs are greater, but milling costs overall are an insignificant cost relative to mining and transportation expenses. As is expected, transportation costs are not significantly different. What is most striking in this cost comparison is the total delivered cost to the port of Beira, Mozambique, where the podiform operations can deliver a ton of product for less than just the weighted average mining cost of the Great Dyke seam operations. The podiform resource operations are very cost competitive relative to other high-grade chromite producers, such as Turkey, and are also competitive relative to the pro- ducers in South Africa. However, it is evident that Zimbabwe chromite production costs, overall, should increase with time as an increasing percentage of Table 25. — Weighted-average mining, beneflclatlon, and transportation cost estimates, per ton of product, for selected chromite operations In Zimbabwe (1981 U.S. dollars) Podlform Great Oyke Average operations seam operations Cost per metric ton: $29.50 $84.50 $79.00 6.00 2.25 2.50 Transportation: FOB Beira, Mozambique 28.00 27.50 27.50 FOB Maputo, Mozambique NA NA 41 .00 FOB Durban, South Africa NA NA 38.00 FOB Port Elizabeth, South Africa NA NA 64.00 Total: FOB Beira, Mozambique 63.50 1 14.25 109.00 FOB Maputo, Mozambique ... NA NA 122.50 FOB Durban, South Africa ... . NA NA 119.50 FOB Port Elizabeth, South Africa NA NA 145.50 Chromite potential' lO^t.. 12,683 111,467 NAp Shipping grade pet CrjOj . . 49.0 50.0 50.0 NA Not available. NAp Not applicable. ' Total chromite potential Is 124,150,000 1. production comes from the Great Dyke. As shown in figure 19, mining cost of product for the podiform operations at $29.50/t represents 46.5 pet of the total delivered cost to Beira, Mozambique. For the Great Dyke seam operations, the weighted-average mining cost of $84.50/t of product represents 74 pet of the total delivered cost. Therefore, as depleting podiform resource production is replaced with Great Dyke seam production, total chromite production costs will rise towards the level of the Great Dyke operations. In addition, since transportation costs for the seam operations represent only 24 pet of the total (as op- posed to 44 pet for the podiform operations), cost reductions in this area will have less of an effect on overall production costs as an increasing percentage of production comes from the Great Dyke. Also shown in table 25 are estimates of average transportation costs to other ports in Mozambique and South Africa (Zimbabwe is a land-locked country). These other ports are located at greater distance than Beira, hence their utilization is more costly. As will be discussed later, however, rail transportation and port facilities represent a major constraining factor on the further development of the chromium industry in Zimbabwe. The estimated costs (mining, processing, and trans- portation) and corresponding cumulative chromite availability estimates for the individual operations are shown graphically in figure 20. The very significant difference in production cost between the two resource types is again evident above a mining cost of $50/t of product, where the podiform resources stop and those of the Great Dyke seams begin. Total chromite product availability, from just the demonstrated resources that were evaluated, is. on the order of 12.6 million t for the podiform resources, the majority of which is contained within the Selukwe Peak and Railway Block operations, and approximately 111.5 million t for the operations of the Great Dyke, for a total of 124.1 million t overall. This figure is both very large and very conservative, given that the dem- onstrated resource estimate used to derive this chro- mite product estimate was only on the order of 175 million t. At a world consumption rate of 10.5 million tpy, this resource would satisfy all world requirements for 17 yr. The life of the podiform resource is limited most likely to at least 30 yr, assuming current capa- city-production rates, but further exploration and development could extend this resource life beyond the year 2015, although probably not on the same scale as today. There is basically no life limit to the Great Dyke seam resource; the Great Dyke is similar in this respect to the Bushveld Complex in that produc- tion will continue as long as there is a demand for mined chromium. HIGH-CARBON FERROCHROMiUM AVAILABILITY Zimbabwe currently has two ferrochromium smelt- ing facilities. The largest is located at Que Que and is owned by Zimbabwe Mining and Smelting Co. The Podiform deposits Greot DyKe seam deposits Great Dyke eluviol deposit model Figure 19. — Percentage distribution between mining, milling, and transportation cost estimates (FOB Beira, Mozambique) for podiform, seam-type, and eluvlal chromite deposits, respectively. In Zimbabwe. 44 TOTAL RECOVERABLE CHROMITE, lO^t Figure 20. — Mining, milling, and transportation cost estimates (FOB Beira, Mozambique), and potential availability of chromite from selected operations In Zimbabwe. second, smaller facility is located at Gwelo, approxi- mately 50 km from the Que Que plant and is owned by Zimalloys. Both smelters are located on a main rail line and are in close proximity to the chromite mining operations. Table 26 provides pertinent data concern- ing current and proposed capacity and smelter prod- ucts. As was the case with mining capacity, plans for increasing smelting capacity have been announced, cancelled, and reannounced with regularity over the last few yr since independence. Although one cannot Table 26. — Ferrochromlum smelters, capacities, and products. Furnaces, MVA Furnace capacity, lO^t/yr Furnace product GWELO (160 X lO^t/yr)' 7.5 8 Low-C ferrochromlum. 8.5 9 Do. 8.5 9 Do. 17.5 18 Ferrosilicon chromium. 17.5 18 Do. 30.0 50 High-C ferrochromium. 2 30.0 50 Do. QUE QUE (310 < lO^t/yr) 15.0 22 High-C ferrochromium. 24.0 37 Do. 24.0 37 Do. 24.0 37 Do. 24.0 37 Do. 24.0 37 Do. 2 30.0 50 Do. 2 30.0 50 Do. ' Expected capacity. ^ Proposed for analysis. be certain as to the actual future capacity of the smelting industry, it is certain that expansion will take place given (1) the government's stated objective of smelting all chromite locally to ferrochromium products, (2) the trend observed elsewhere for down- stream processing stages (in this case ferrochromium) to be increasingly located near raw material sources, (3) the obvious advantage of utilizing scarce trans- portation and port facilities for the movement of a higher valued product (ferrochromium versus chro- mite), and (4) the positive developmental and foreign exchange benefits to be derived from further develop- ing and marketing greater value-added ferrochromium products as opposed to chromite products. With these factors in mind, this study assumed that smelting capacity at the two plants would be expanded to the proposed 160,000 tpy at Gwelo and to 310,000 tpy at Que Que. This represents something on the order of a 50-pct expansion over current capacity. For the eco- nomic analysis, all chromite output was assumed to be smelted to a grade-A (>64 pet contained Cr), high-C ferrochromium product. All capital costs for the smelter expansions were prorated back to the company's chromite mines. It is estimated that the expansions should cost around $l,000/t of annual capacity. Because of the very high Cr:Fe ratios of Zimbabwe chromite, the grade of fer- rochromium products is very high, possibly the highest in the world, with typical grades ranging from 64 to 72 pet contained Cr. Using a smelting recovery of 80 pet gives an indicated consumption factor of 2.3 t of a 52-pct Cr,03 chromite concentrate to produce 1 t of 45 high-C ferrochromium. Thus, the indicated total chro- mite consumption requirements at these expected smelting capacities by year N-|-2 or N-|-3 (1983 or 1984 in this analysis) would be roughly on the order of 1 million t. Given that the estimated chromite product output by this time is estimated at approxi- mately 1 million t as well, it is obvious that there is little room for chromite exports from Zimbabwe in the near future. But this is in keeping with the basic plan of the government. In the smelting process, all fines material must be agglomerated either to briquets or pellets at the smel- ter to ensure efficient smelting. This practice is par- ticularly prudent at the Gwelo smelter, which utilizes 100 pet Great Dyke material. The cost of briquetting is around $10/t to $15 /t of ferrochromium. The Que Que smelter, even though much of its feed material does not require briquetting, nonetheless faces its own problems in that its feed comes from a variety of sources. In 1980, the company was experimenting with blending five different chromite ores-concentrates and their power consumption increased from 3,900 to 4,400 kWt/t of high-C ferrochromium. Of the raw ma- terials needed for ferrochromium smelting, only coal and coke for the Gwelo smelter are indicated as being imported from South Africa. Smelting costs are com- posed of about 28 pet for power costs, 12 pet for labor, 29 pet for raw materials (reductants, fluxes, elec- trodes, etc.), 17 pet for supplies and maintenance, 1- o <:3 CO -a "S .20 IS .15 o ..Oh KEY 15- pet rate of return 0-pct rote of return TOTAL POTENTIAL FERROCHROMIUM, lO^t Figure 21. — Cost and potential availability estimates of high-carbon ferrochromium from selected chromite operations mr and 14 pet for overhead and indirect costs. These figures should be interpreted as averages. Figure 21 and supporting data in table 27 present the long-run average total cost estimates and cor- responding cumulative high-C ferrochromium tonnage potentially available from the demonstrated resources of the 29 operations evaluated in Zimbabwe. All cost estimates are on an FOB smelter basis. (Since ferro- chromium exports utilize numerous ports in Mozam- bique and South Africa, these costs were calculated on this basis to ensure comparability of operations). Transportation costs per pound of contained chromium to the ports of Mozambique and South Africa are esti- mated to range from $0.03 to $0.04 to Durban, South Africa, and $0.01 to $0.02 to Beira, Mozambique. The cost of transportation to the port of Durban compares favorably with that for the South African produers, on a per pound contained chromium basis, because a typical ton of ferrochromium produced in Zimbabwe contains 68 pet Cr whereas a typical ton of South African ferrochromium contains around 53 pet Cr or 22 pet less Cr per ton of ferrochromium transported. This helps to offset the greater transportation dis- tances faced by Zimbabwean producers. The costs for all operations at the breakeven level range from $0.15/lb to $0.30 /lb ferrochromium, averaging $0.25 /lb, which equates to $0.37/lb con- tained Cr for a 68-pct ferroalloy product. At the 15-pct profitability level the costs range from $0.17/lb to $0.34 /lb ferrochromium, averaging $0.27/lb, which equate to $0.40/lb contained Cr. The narrow range be- tween the two average chromium cost estimates (i.e., $0.37 /lb and $0.40/lb) indicates that the chromium industry of Zimbabwe is a mature industry that has already recouped its major, historical capital invest- ments. Further, it can absorb the additional capital costs for mining, milling, and smelting expansions herein assumed and attain a 15-pt long-run profit- ability level with only a $0.03/lb Cr increase in selling price. _ The' well established, large-scale podiform operations in the Selukwe District are the least expensive sources for ferrochromium in the country. The other non- producing podiform operations also represent an avail- able low cost resource. Together the podiform re- sources have an estimated long-run average cost of $0.25/lb Cr at the break-even level, which is 35 pet less than that estimated for all Great Dyke seam operations. The Great Dyke material also represents an eco- Table 27. — Average total cost ranges per pound of contained chromium and corresponding ferrochromium availability, by resource type, for Zimbabwe (1981 U.S. dollars) Breakeven level Range Weighted average 15-pct profitability level Total ferrochromiunn availability, 10^ t Great Dyke seam operations Podiform operations Eluvial soil model Total or weigfited average NAp Not applicable. ' Weighted averages over all operations evaluated. $0.32-$0.43 .22- .29 .34 $0.38 .25 .34 $0.34-$0.50 .25- .34 .35 48,789 5,068 240 46 nomic resource but at a higher cost relative to the podiform resoures. The long-run average cost estimate for all Great Dyke seam operations, at the breakeven level, is estimated to be $0.38/lb Cr. Thus, as the podi- form resources are depleted, ferrichromium produc- tion costs should begin to increase to the level of the Great Dyke resources. In constant 1981 dollars, this increase through time should approach 35 pet, overall. The eluvial soil operation model was estimated at $0.34/lb Cr. This seems to indicate that the estimated 54 million t of eluvial soil material could provide a source of increased production in the future as the podiform resources are further exploited. However, this would require much additional exploration and delineation of reserves by location. The problem with the eluvial soil operations seems to be attaining a high enough level of reserves to give a reasonable life to a specific mill. The total high-C ferrochromium estimate of 54.1 million t, not surprisingly, is enormous and a resource product of high quality. The figure represents 115 yr of full, expanded capacity production and itself repre- sents only a fraction of the ultimate potential for chromium-resource-based products available from Zim- babwe. The podiform operations account for 5.068 million t or 9.3 pet of the total. The remaining 91 pet is available from the Great Dyke operations. CONSTRAINTS TO DEVELOPMENT Transportation and Porting Facilities In order to realize the very great potential dis- cussed above, two major bottlenecks need to be ad- dressed. The first is the availability of a sufficient transportation network and porting facilities. The greatest distances from mine and mill sites to ports for the countries studied are from the chromium mines of Zimbabwe. The greatest individual distances are encountered when shipping through the ports of Durban and Port Elizabeth in the Republic of South Africa. The distances range from approximately 1,500 to 2,000 km to Durban and 1,700 to 2,200 km to Port Elizabeth. This includes both trucking and rail trans- port, with rail representing most of the distance. There is a distinct cost advantage when shipping from Zimbabwe through the port of Beira in Mozam- bique. The average cost of transporting chromite from all mines in Zimbabwe to this port is approxi- mately $ll/t (29 pet less) than the average cost to Durban and about $37/t (58 pet less) than the average cost to Port Elizabeth. However, Beira does not have sufficient capacity to handle all chromium exports in addition to other goods. Currently, Beira can only berth vessels up to 25,000 t. In addition, this analysis indicates that the cost to transport chromite to Ma- puto, Mozambique's other major port, averages slightly more (even though the distances are less) than the cost to transport chromite to Durban, South Africa. The difference of $3/t results from lower official rail costs within South Africa as opposed to those of Zim- babwe and Mozambique. The actual cost, of course, can vary from operation to operation and is certainly influenced by governmental trade policy (subsidies and/or tariffs) on the part of Mozambique, Zimbab\ve, or South Africa. Although both Beira and Maputo were relatively major ports prior to the latter half of the 1970's, they have both declined noticeably in terms of the amount of cargo handled. This was mainly precipitated by the closure of the rail lines from Zimbabwe during the civil war in 1976. In 1979, Maputo reportedly handled only 1.5 million t of cargo as compared to 13 million t in 1969 and currently can only berth vessels up to 65,000 t (2ji, p. 53) . More recent estimates (23, p. 330) show Maputo handling only about 500,000 tpy with plans to raise this in the future to 3.3 million tpy. Since the lifting of sanctions in 1980, the port of Beira has reportedly been handling around 550,000 tpy (23, p. 330). In any event, given that the rail system of Zimbabwe handled somewhere around 12.5 million net tons in 1981 (23, p. 330), it is clear that South Africa remains the major route of exportation and importation. It has been reported that the government of Mo- zambique plans to spend $320 million to upgrade and improve the ports and rail lines in the country (24., p. 53). The timeframe and availability of the necessary funds are in doubt, however, and until these improve- ments are made the ports of Beira and Maputo will continue to play a minor role, relative to the ports of South Africa, in Zimbabwe's export trade. Meanwhile, the government of Zimbabwe has earmarked approxi- mately $140 million for equipment and electrification of the railways. It has also undertaken a project, backed by the World Bank, worth approximately $130 million for upgrading the rail system in general (23, p. 330). The government's overall plan is to make Zimbabwe the transport hub for the black-ruled states of southern Africa, and it intends to switch its ex- ports to the ports of Mozambique from South Africa as soon as such a switch becomes technically feasible. Power Supplies The ferrochromium smelters are the largest con- sumers of electricity in the country, consuming at least 10 pet of total electric power generation. Cur- rently, 90 pet of electricity generation is hydroelectric- based, with around one-third imported from Zambia (24, p. 51). This import level should decrease in the future as Zambia's growth requirements consume a larger share of its total electric generation. When the smelting capacity expansions outlined above are in place (N-(-3 or N-|-4 yr) then ferrochromium's share of total electric generation would represent around 20 to 25 pet of total country requirements assuming 1980- 81 consumption for uses other than ferrochromium smelting remain constant. According to Shekarchi, it took approximately 600 to 750 million kWh of elec- tricity in 1980 to produce 150,000 t of ferrochromium (24, p. 51). At a capacity level of 470,000 tpy, a rough estimate indicates a need for 1.8 to 2.3 billion kWh. Thus the availability of sufficient electric supplies would be strained, and the expansions discussed above would depend heavily on expanding power supplies. 47 The Wankie I coal-fired generating plant, due to start up in 1983, and the Wankie II, due to start up in 1986, will add about 1.3 billion kWh of electric power generation between them. Given Zimbabwe's large coal reserves, coal powered generators are a logical primary source of future power for the country. Additional hydroelectric power is another source, with the possi- bility of adding two generators to the Kariba South power station on the Zambezi River. Shekarchi (2^, p. 52) further estimates that, assuming a 10-pct growth rate for electricity demand and imports from Zambia declining to zero, by 1990 Zimbabwe could still face a consumption requirement shortfall of 5 billion kWh. The resources for expanding electric sup- ply are there but the enormous cost and the time requirement pose the problems to overcome. THE MINERALS MARKETING CORPORATION OF ZIMBABWE In 1982, the government of Zimbabwe enacted legis- lation establishing a Minerals Marketing Corp. (MMC) (39, p. 61). Although the full intent of the agency will only be ascertained through examination of its future performance, it would appear that the intent is twofold. First, the MMC is granted authority to assume the function of marketing the products of the country's mining industry, with the exception of gold. This would mean either purchasing all mineral prod- uct output directly from the operating companies for resale to world markets or for internal consumption, or review and endorse or reject the privately arranged sales contracts. The companies will therefore probably have to make the agency privy to production and sales details. Seond, the agency has the authority to impose a sales commission. Among the reasons for establishment of the MMC is the concern within the government over alleged abuses of "transfer pricing", which is a means of over- invoicing or underinvoicing between local and foreign parent companies to avoid taxation and to transfer capital. There is also an element of governmental revenue raising involved, as well as the desire to more closely control and coordinate the mining industry within the context of the overall economic goals of the government, which, later on, should begin to seek to acquire an equity position within the industry. The long-term effect of governmental intervention in the mining industry of Zimbabwe via such func- tions as marketing, production control, or equity par- ticipation, for example, is beyond the scope of this report. However, one can address the long-term impact upon average production cost from imposition of a sales commission. The direct impact from imposition of any "add-on" cost, such as a sales tax (commission), is to either raise average production costs and therefore sales price, or lower company profits, or both. These costs are particularly burdensome in periods of oversupply or weak demand such as has been the case in recent years in the world chromium industry. The methodological approach taken in this analysis is to impose a 15-pct pretax sales commission on the total revenues generated per operation per year from the production of high-C ferrochromium. The current sales commission is probably not in excess of a few percent ; however, the sales commission was set at this potentially high level in order to address the maximum impact that such an add-on cost (or costs) might have on determining the ability of Zimbabwe's ferrochromium producers to remain com- petitive. It is not at all unlikely that this type of cost will increase in the future. It is assumed that all properties operate at full capacity throughout the productive life of the demon- strated resource tonnages identified for each property, and that all output is sold at that price (FOB the smelter), which will maintain a specified profitabil- ity level after covering total investment costs. The profitability level selected was the breakeven level. The results obtained from this analysis are then com- pared with those of the base case analysis presented earlier in order to isolate the total (cost = sales price) increase necessary to maintain a given level of profitability, and further, to show what the reduc- tion in ferrochromium availability would be at any given price-cost level. Of course, in times of falling world prices for ferrochromium, when it is not pos- sible for all producers to obtain the prices necessary to absorb the tax-cost increase, rates of return would fall. The purpose here is to identify only the increase in production cost and thus determine the effect upon the long-term competitiveness of Zimbabwe's ferro- chromium industry relative to other producing nations. It bears mentioning that since the sales commission is applied in this analysis as a pretax cost, its effect upon the determination of necessary price is less than if it were applied as an after-tax cost. The results of this analysis indicate clearly that the full imposition of a 15-pct sales commission would result in significant increases in necessary long-run sales prices for the industry to maintain a breakeven level of profitability. The difference between the cost increase for operations mining the seams on the Great Dyke as opposed to the podiform-type operations is illustrative. Table 28 provides cost estimates for the two resource types with and without the imposition of the MMC tax, herein assum.ed. This differential effect can also be seen in figure 22, which shows a greater upward shift in cost for the seam-type opera- tions of the Great Dyke. As shown, the imposition of the sales tax results in an average increase of $0.05 per pound contained chromium for the operations min- ing Great Dyke seam deposits as opposed to an average $0.03/lb contained Cr increase (40 pet less) for those mining the podiform-type deposits in the Selukwe and Belingwe Districts. Table 28. — Weighted average breakeven cost estimates per pound of contained chromium In Zimbabwe, with and without a 15-pct MMC sales commission All properties Great Dyke seams Off-Dyke podlfomntype $0.37 .42 $0.38 .43 $0.25 MMC .28 Difference .05 .05 .03 10 20 30 40 50 60 TOTAL POTENTIAL FERROCHROMIUM.IO^t Figure 22. — The effect of a 15-pct MMC sales commission upon the breakeven cost level estimates of high-carbon ferrochromlum production In Zimbabwe. The podiform-type deposits currently account for a large majority of Zimbabwe's chromium production. These properties are already very competitive and could conceivably absorb the total tax burden and still remain so. However, the total production life of these properties is very limited relative to the seams of the Great Dyke. It is this latter resource that will provide the long-term (beyond 30 yr) production potential for Zimbabwe ; and these properties, because they are more costly to develop and operate, would require signifi- cantly higher selling prices to absorb the additional tax burden. The differential effect upon the two types of operations should cause an increase in the com- petitive advantage of the podiform type over the Great Dyke seams and could result in more capital resources being devoted to their exploitation relative to the seams. Assuming that the podiform resource will last well into the next century, however, there would not appear to be any immediate, overall detri- mental effect upon Zimbabwe's competitiveness in the world chromium industry. A comparison with the properties of South Africa indicates that the advantage enjoyed by the South African ferrochromlum producers would be enhanced by the imposition of this tax. A comparison of break- even weighted average total costs, on a per pound of contained chromium basis (in order to compare the two properly) , shows a South African advantage rela- tive to all Zimbabwean producers (FOB the smelter) of $0.08/lb without the imposition of the sales com- mission. This advantage increases to $0.14/lb con- tained chromium with the tax imposed. The producing podiform operations in Zimbabwe, with imposition of the tax, have their $0.04/lb advantage effectively eliminated. These results are shown in table 29. A few caveats are in order. First, the overall advan- tage of South African producers is understated here because of the added transportation cost incurred by the Zimbabwe producers versus the South African. Some of the ferrochromlum produced in Zimbabwe must be routed through South African ports at a higher cost because of the inability of the ports of Mozambique to accommodate all output. Second, the producing podiform operations in Zimbabwe, even with the long-term increase in production costs from the imposition of this tax, are still lower cost produc- ers than those in Turkey, which directly competes with Zimbabwe for the sale of grade-A ferrochromlum. Finally, what is perhaps more significant for the long-term potential of the chromium industry in Zim- babwe is not the actual imposition of a sales tax but rather the existence of a government agency involved in the decisionmaking process of production, stockpil- ing, sales, and ownership of the industry — ^which could result in reduced private investment in the country. This effect, of course, is diflScult to quantify but un- certainly in business is a major consideration. SUMMARY A total of 175 million t of in situ demonstrated chromium-bearing resource was cost-evaluated. This resource is estimated to contain approxi- mately 124.2 million t of 50 pet CrgO, high-Cr chromite products in the form of lump and fines material. Of the total chromite tonnage analyzed, 12.7 mil- lion t (10 pet) is contained within the podiform operations and 111.5 million t (90 pet) is con- tained within the Great Dyke seam operations. Total high-C ferrochromlum potential is esti- mated at 54.1 million t, also split 10 pet to the podiform operations and 90 pet to the Great Dyke seam operations. Chromite production costs, as defined, were esti- mated at $63.50/lb and $114.25/lb, delivered to Beira, Mozambique, for the podiform and seam- type operations, respectively. High-C ferrochromlum production costs (as de- fined) were estimated (FOB the smelter) at $0.25/lb and $0.38/lb Cr at the breakeven cost level for the podiform and seam-type operations, respectively. Table 29. — Comparison of weighted-average production costs per pound of contained chromium at the breakeven level In South Africa versus Zimbabwe with the Imposition of a 15-pct sales commission (1981 U.S. dollars) Zimbabwe weighted-average production cost South African advantage or disadvantage' Base case Sales commission Base case Sales commission All properties $0.37 $0.43 (-) $0.08 (-)$0.14 Great Dyke seams .38 .44 (-) .09 (-) .15 Podiform type .25 .29 ( + ) .04 ' The negative sign ( - ) or positive sign ( + ) means that South African production is less than ( - ) or greater ttian ( + ) the cost determinations for Zimbabwe. Major implications are that chromite and ferro- chromium production costs should rise through time as the podiform resources are depleted and a greater percentage of production comes from the seam-type operations. In addition, large capital investments will be required to alleviate trans- portation and energy supply bottlenecks in order to realize the industry potential outlined above. Availability of chromite products for export should decline as the country's stated goal of utilizing 100 pet of its chromite for ferrochro- mium production is instituted. TURKEY GEOLOGY AND RESOURCES As shown in figure 23, ultramafic rock complexes in Turkey that have served, or could serve, as host rock for chromite deposits are widespread and numerous. Since approximately 23,000 sq km of area consist of ultramafic outcrops, it follows that the number of individual deposits and occurrences could be very large as well. Ethem (^0) states that chromite occurrences ^jr^ r-L^fifT^. y s "» T ^ sJ*'' t» \ — ^ - n ^ i 1'^ ■** ''. t W / |i* ' ^v^ ^^5s;K y « \5^^^ 8 {-j-J^ aI -5 i- E -W.,^: . :).- \ • s , <• / ^ o y^'^r^'^SiM •' LAI .\ ^'^^0^ 'I wC'r^/^ r 0^5 , ( 1 * Figure 23. — Location of baslc-ultrabasic rock distribution, chromite mines, ferrochromlum smelters, and ports of exportation In Turkey. 50 Table 30. — Chromlte reserves of Turkey, 1972 Turkish government estimates Deposit'-Operation District Province Reserve tonnage, 10^ t Proven Probable Possible Total 3,767 1,126 15,000 19.893 5,949 552 NA 6,501 950 1,050 NA 2,000 652 876 NA 1,528 605 411 383 1,400 NA NA 800 800 NA NA 640 640 NA NA 556 556 NA NA 410 410 105 185 40 330 202 NA NA 202 34 61 42 139 60 40 NA 100 NA NA NA 1,817 Kefdag* Soridag-Guleman* Kavak* Kopdag* Uckopru* Kandak* Akcabuk Yoruceler Sariova-Uzunoluk . . . Beydemir Mevlutler Mesebuku-Otmanlar . Others Total . Maden . . .do . Mihaliccik . .Tercan.... . Fethiye . . . .Ula . Orhaneli . . . Acipayam . . Orhaneli . . . Orhaneli . . . Acipayam . . Koycegiz. . . NA . Elazig . . . . ..do . Eskisehir. . Erzincan . . Mugia . . . . ..do . Bursa . Denizli . . . . Bursa. . . . .Denizli... . Bursa . Denizli . . . . MugIa . . . . NA NA Not available. ' Asterisk indicates those operations subject to cost evaluation. Source: Kocaefe {42). can be found in 40 of the nation's 67 provinces. He lists 90 separate reg'ions or districts as having chromlte deposits or occurrences. In 1966 MTA, the government exploration agency, in an attempt to describe all known chromite deposits or occurrences, reported on over 330 deposits or deposit groups Ul). This report stated that, "in- formation on most of these deposits is incomplete and only in a few cases could a detailed description be given." In 1972, MTA released estimates of chromite reserves in Turkey U2). As shown in table 30, six individual operations — the Kefdag, Soridag, and Uck- opru operations of Etibank and the Kandak, Kavak, and Kopdag operations of various private owners — accounted for 96 pet of the proven plus probable re- source tonnage of 16.6 million t (roughly equivalent to the demonstrated level) and 89 pet of the proven plus probable plus possible resource tonnage of 36.3 million t (roughly equivalent to the identified level) . For this study, the Bureau of Mines has concen- trated on determining the demonstrated resources of these six operations as of 1980. A seventh operation, Mesebuku-Otmanlar, was also investigated but was determined to have an insignificant resource level and therefore not subjected to complete cost analysis. The results are shown in table 31. The total demonstrated resource level, as of 1980, for these six operations is estimated to be approximately 11.7 million t of in situ material with an average grade of 38 pet Cr^Oa that represents 4.5 million t of contained CrgOg. These six operations represent the tonnage contained in only 25 deposits or deposit groups out of the more than 300 referenced by MTA nationwide. The identified resource level for these properties is the same as the demon- strated level precisely because of the lack of confidence in inferences based upon the sketchy data that is available on Turkish chromite deposits. The following discussion deals with each of the six properties sub- jected to complete cost evaluation. The Soridag group consists of 10 deposits, all within a 10.5-sq km area. The demonstrated resource of 2.7 million t at a weighted average grade of 46 pet Cr^O,., represents the combined in situ tonnage of three major deposits within the group ; the Ayi Damar, Kapin, and Table 31 . — Estimated In situ chromlte resource data for selected Turkish operations as of 1980 n-n«cif nnor..inn Demonstrated ^fL^.a!?' Contained^ Depos.t.operat,on ^^^^^^^. ^^ , ^^^ --age^^^^ cr.O, 10^ . Kefdag 5?ioO 3a0 1336 Soridag 2,727 46.0 1,254 Kavak 1,600 29.0 464 Kopdag West-North Zone. . . 1,000 43.0 430 Uckopru 850 40.0 340 Kandak 353 46.0 162 Mesebuku-Otmanlar M6 400 18 Total or average 11.676 "38.0 4,500 ' Identified tonnage equals demonstrated plus inferred tonnage; in this case, there was insufficient information to support an inference beyond the demonstrated level. ' Data may not add to totals shown due to averaging and independent rounding. ^ Not cost evaluated. * Country grade is the in situ weighted average over all deposits at the demonstrated level. Uzun Damar deposits. An estimated 1.25 million t of CrjOg is contained within this tonnage. The three deposits are all of the planar-banded type with ore body thicknesses averaging about 3 m. The ore grades vary from 42 to 51 pet CrgOg with a weighted average of 46 pet and a Cr:Fe ratio of 2.9. In general, the deposits can be followed for long strike lengths, al- though interruptions by faults are common. The Kefdag group of deposits is located about 5 km southwest of the Soridag group. It consists of two deposits, Kefdag East and Kefdag West. They are also of the planar-banded type with two types of ore ; dis- seminated, low-grade material, and massive, high- grade material. The low-grade, disseminated ore grades in the range of 30 to 38 pet Cr^O,, averaging 36 pet, and the massive, high-grade material averages about 38 pet CrgO.n. The demonstrated resource of the Kefdag group is estimated at 5.1 million t, approxi- mately 65 pet of which is disseminated, low-grade ore and 35 pet of which is massive, high-grade ore. This resource contains approximately 1.8 million t of con- tained Cr^O, with a Cr:Fe ratio of 2.9. The ore bodies strike northeast and dip to the south at Kefdag West 51 and to the north at Kefdag East. Dip is almost vertical at depth. The Kavak-Mihalliccik District is located on the crest and south flank of the Tastepe mountain range. This district consists of 21 separate ore bodies all located within a 1,000- by 500-m area. Three different structural types of ore bodies are present: pipelike or chimneylike ore bodies (Camasirlik I through V, Orta, and Yazlik) ; flow-type ore bodies (Ernler I through VI), and planar-banded ore bodies (numbers 12-17) . The greatest potential lies in the chimneylike ore bodies Camasirlik II and III, which are presently being mined, and Camasirlik V. The ore itself is of the schlieren tyipe, grading 32 to 37 pet CrgO,, when not diluted. Below the 150 m level in the present under- ground mine, the contact between the dunite and chromite is not distinct so dilution of about 15 pet dunite is unavoidable. The demonstrated resource of 1.6 million t represents ore at Camasirlik II and III above the 360-m level and assumes a dilution of 15 pet. The diluted grade averages 29 pet CrjO,,, and the two ore bodies combined contain an estimated 464,000 t of Cr^Os in situ at a Cr :Fe ratio of 3. The Kopdag-Askale chromite region is centered about 120 km south of the Black Sea port of Trabzon. It consists of three basic chromite districts, the most important of which appears to be the Kopdag West group located about 30 km northwest of the town of Tercan. Within the Kopdag West group, the north zone of occurrences is by far the more important of the two zones with at least 25 separate occurrences or deposits found along a 13-km east-northeast trend. Supposedly, the ore bodies are large, and it has been conjectured that some could extend to depths of 100 m. In 1965, a rough estimate was that the north zone could contain at least 1 million t of ore (41 ) . As shown in table 30, MTA's 1972 reserve estimate for Kopdag was 652,000 t of proven and 876,000 t of probable ore. For this study, the 1980 demonstrated resource esti- mate for the 25 deposits in the Kopdag West north- zone area is set at 1 million t grading 43 pet and containing 430,000 t of Cr^Og. The Cr:Fe ratio ranges from 2.1 to 3. The Uuckopru operations and the Kandak mine are located within a large peridotite complex covering about 3,000 sq km in southwestern Turkey ; extending 130 km from the Datca Peninsula to a point about 20 km southeast of the port city of Fethiye. The Uckopru operations consist of two deposits ; Uckopru and Zim- paralik, located within 5 km of one another in an area about 40 km due north of Fethiye. The Kandak mine is located about 30 km east-southeast of the town of Mugla and 23 km due north of the town of Koycegiz. As mentioned, the demonstrated resource for the Uckopru operation consists of ore from two disparate ore bodies: Uckopru and Zimparalik. The Uckopru material is relatively high-grade, massive-type ore averaging 46 pet Cr^Og. The Zimparalik ore is low- grade, dissiminated-type ore averaging 34 pet CrjOs. The two ore bodies contain an estimated 850,000 t of in situ resource at the demonstrated level, with a weighted-average grade of 40 pet, containing about 840,000 t of Cr^Oj. The Cr:Fe ratio runs about 3. The Kandak deposit occurs as an antiform plunging 50° to 70° to the west. The north limb of the antiform is the important portion of the deposit as the south limb has been shown to die out at a down-limb depth of 40 to 50 m. Demonstrated resources are herein estimated to be about 353,000 t of ore, grading 44 to 48 pet, containing approximately 162,000 t of CrjOg at a Cr:Fe ratio of 3. A summarization of two points is in order. First, the demonstrated resource of 11.7 million t that was cost evaluated represents the tonnage available from only 25 individual deposits being mined by just six operations. This is about 5 to 8 pet of the total chro- mite deposits, occurrences, or deposit groups that have been described in past literature. Second, the opera- tions in this study represent only about 70 to 80 pet of the country's total production ; the remaining 20 to 30 pet is supplied by numerous small mines which are impossible to cost evaluate. There are still many pos- sibilities for discovery of new podiform deposits or rediscovery of old deposits, given that the country is covered by more than 23,000 sq km of ultramafic com- plexes. However, it is questionable whether enough of these discoveries could ever leave Turkey in the posi- tion of being able to significantly and rapidly increase production. Most operations mining a reasonably sized ore body of 50,000 to 100,000 t are very small capacity operations (probably averaging 12,000 tpy of mine output) and very labor intensive (around 0.5 to 0.75 t of ore mined per worker-shift). To double estimated 1980 production of chromite products from 440,000 to 880,000 t would require about 600,000 additional t of run-of-mine crude ore, which would entail 50 separate 12,000-tpy mining operations and approximately 3,000 to 4,000 additional mine laborers. Seemingly in recognition of this small-size- deposit problem, it is understood that MTA is investi- gating the possibility of mining and beneficiating large, very low-grade chromite bodies in the 5- to 10-pct chromite range. The geologic potential in Turkey for such ore bodies is unknown at this time but is probably high considering the size of complexes available as hosts. However, much exploration and study remain to be done. MINING AND BENEFICIATION Except for a few small surface operations, the larg- est of which is probably the Mesebuku operation, all of the major chromite mining operations in Turkey utilize underground mining methods. The six major mines evaluated here are all underground operations. The three basic types of underground-mining tech- nology employed in Turkey are horizontal cut-and-fill, inclined cut-and-fill, and shrinkage stoping. The choice of method depends upon the strengths of the rock types and the thickness and inclinatiorf of the ore body. Labor productivity estimates for the various methods range from lows of 0.5 to 1 t per worker-shift in inclined cut-and-fill operations, to 1.2 in horizontal cut-and-fill operations, to the highest productivity of 1.6 for the shrinkage stoping method. The percentage of mine operation costs per ton of crude ore that is represented by labor, ranges from 30 52 pet in the highest productivity mines to as much as 65 pet in the lowest productivity mines. The cost of sup- plies ranges from 20 to 30 pet of the total mine operat- ing cost. Exploration and development costs directly attributable to day-to-day operations range from $1.50/t to $2.75/t of ore. Of importance is the fact that as much as 25 pet of total labor costs (5 to 15 pet of the total mine operating cost) can be attributed to the hand sorting of waste and various types of ore either underground or on the surface. The mine operators in Turkey are constantly look- ing to further mechanize the mines to improve pro- ductivity. An example of possible savings was given by Kromer in 1954 (iS). He lists "before and after" data for the introduction of mechanization at the old Basoren mine. After mechanization, productivity at this 15,000 tpy crude ore operation increased 83 pet from 0.35 to 0.65 t per worker-shift. The cost of labor, explosives, and other supplies decreased 42, 15, and 83 pet, respectively. The overall effect was a 47-pet de- crease in direct mining costs. However, there are limits to mechanization in Turkish ehromite mines, mostly due to the need for sorting of ore from waste and the small thicknesses of the ore bodies (3 m or less). Only in ore bodies or ore zones that reach 5 m or more in thickness can the use of high tonnage mechanized methods and equipment be considered. Even then, the probability of excessive dilution of al- ready low-grade ore, or exacerbation of support prob- lems, will most likely offset the advantages. Transportation costs can average as low as $l/t or as high as $4.25/t of ore depending upon the distance from the mine head to the mill site. Mining recoveries are estimated at between 90 and 95 pet, and working days per year range from around 250 to 300. Costs for the reinvestment of mine equipment range from $15.50/t to $19.50/t of annual crude ore capacity, whereas replacement costs for mine plant generally average about half of the mine equipment replacement costs. In total, a new underground Turkish ehromite mine averaging about 50,000 tpy of crude ore would cost approximately $2.7 to $3.2 million to develop. Benefieiation of ehromite in Turkey is highly va- riable from property to property and even within a particular property. An example of one property utiliz- ing a variety of beneficiation methods is the Kefdag operation in Elazig Province. At Kefdag, the higher grade, massive ore is hand sorted and screened to produce a lump ore product and a fines feed to a simple gravity plant. The low- grade, disseminated ore provides the feed to a mag- netic separation plant. These three basic methods are used in various combinations at the other producing properties. Operating costs for the different ehromite beneficia- tion methods vary considerably. Component factor con- tributions to total operating cost vary as well. The percentage contribution of labor cost can range from 90 pet in the ease of hand-sorting operations to 30 pet for magnetic separation. Materials and supplies costs can contribute up to 30 pet of the total and equipment operation can range from effectively zero for hand-sorting operations up to 40 pet for heavy- media, gravity processing. Labor is the primary cost item since about half of all ehromite ore is bene- fieiated by hand-sorting methods. Capital replacement costs, as of 1981, are estimated to range from $14/t of annual ore feed capacity for a basic hand-sort, gravity-separation mill, to $27/t for a heavy-media, gravity mill, to as much as $80/t for a magnetic- separation plant. The weighted-average concentration ratio for all six properties evaluated is 1.3 t of crude ore per ton of salable ehromite product. This concentration ratio ranges from 1:1 for run-of-mine marketable ore to as high as 1.7 to 2.3 where either magnetic separation is necessary, or a combination of heavy- media and conventional gravity separation is used to produce an extremely high grade concentrate product. Estimated mill recoveries range from lows of 80 to 84 pet for fairly complicated processes required for low-grade ores to as high as 100 pet for high-grade, run-of-mine lump ores. The weighted average mill recovery for all six operations comes to 94.3 pet, which is fairly high on a worldwide basis, reflecting the large percentage of Turkish resource that is high-grade, basically run-of-mine material. CHROMITE AVAILABILITY The demonstrated resources for the six operations evaluated in Turkey have a potential total ehromite availability of 7.6 million t of shipping-grade ehro- mite products averaging 46 pet CraOg. Mine operating capacities range from a low of 15,000 to a high of 236,000 tpy of crude ore. Mine lives for the six operations at full capacity utilization would range from 7 to 33 yr. Of the total estimated analyzed capacity of approximately 621,000 tpy of crude ore, 46 pet requires only hand sorting and/or screening to produce a marketable product, 34 pet is sent to various gravity-separation mills, and 20 pet goes through a magnetic-separation process. This mine output, after accounting for the various recoveries at the mill sites, produces approximately 460,000 tpy of ehromite products. Of the estimated total available products from these properties, about 59 pet is produced from simple hand sorting and/or screening, 25 pet is produced from gravity-separation processes, and 16 pet comes from magnetic separa- tion. Cr:Fe ratios for Turkish ehromite products are generally ^2.8. With a weighted average concentration ratio of 1.3 and weighted-average crude ore mining cost of $27/t, the mine operating cost of salable product is estimated to average a relatively low $35/t. Since beneficiation is primarily by hand sorting and grav- ity concentration, processing costs average only about $5/t of product. Transportation costs at $59.50/t, however, are by far the highest of all the countries studied. This brings the total cost of product, on an average country basis FOB the various ports of exportation, to an estimated $99.50/t. In Turkey, the chromium mines are dispersed throughout the country. The terrain can often be mountainous, and distances from the ports can 53 range as long as 300 to 500 km. These distances are not as great as those faced by the countries of south- ern Africa, but overall transportation costs are greater owing to the mountainous terrain through which some chromite must be shipped, the greater dependence on long-haul trucking, smaller tonnage shipments, competition from higher valued commo- dities, and increased maintenance costs. The mines in Mugla Province (including the Uck- opru deposits and the Kondak mine) are approxi- mately 40 to 100 km, respectively, from the port of Fethiye, and with weighted-average transport costs to this port of $13.50/t, are the least expensive in the country. However, in terms of total potential tonnage nationwide that needs to be transported, only about 10 pet is located suflficiently close to utilize this port. Most tonnage is moved through the port of Iskenderun from the Guleman chromite district in southeastern Turkey and is estimated to average approximately $65/t in transport costs from the mines to the port. The other major producing area (Eskisehir) utilizes the port of Izmit on the sea of Marmara and faces inland shipping distances of up to 350 km. The Kavak mine in the Eskisehir area utilizes an aerial tram, truck, and rail to transport chromite ore to this port. HIGH-CARBON FERROCHROMIUM AVAILABILITY At present, Turkey has two ferrochromium smelt- ers, both owned and operated by Etibank, itself a 100-pct government-owned company. The Antalya plant, located in the port city of the same name on the southwest coast, produces only low-C ferro- chromium. Its present production capacity is 10,000 tpy. The plant was built in the 1960'3 and was the only ferrochromium smelter in the country until 1976. The Elazig smelter, located in the provincial capital city of Elazig, about 40 km northwest of the Soridag-Kefdag deposits, produces only high-C ferro- chromium. As of 1980, the plant's design capacity was 50,000 tpy of high-C ferrochromium, although it has never produced more than half of that tonnage in any year since the start of production in 1976. Etibank has announced plans to increase high-C ferrochromium capacity to 100,000 tpy with the addi- tion of two submersible electric-arc furnaces which would require an additional 275,000 tpy of ore and concentrate feed. This tonnage requirement repre- sents approximately 100 pet of Etibank's current production capacity in the Elazig District, according to this study. This would leave very little additional tonnage available for export; but such a develop- ment would be advantageous because the output of ore and concentrate from Etibank's Elazig opera- tions suffers from having the longest and most inefficient transportation route to the nearest port of exportation of all the major Turkish chromite operations. Production of ferrochromium not only increases the product value-added but in this case serves to more effectively compete with other high value commodities for the limited rail capacity. Smelter operating costs in Turkey are composed, on average, of about 40 pet electric power, 28 pet labor, and 32 pet raw materials. Turkish chromite is high in chromium content, averaging 46 pet CrgOg, and produces a high-Cr (grade-A) ferrochromium containing at least 65 pet Cr. In order to ascertain the total potential avail- ability of domestically produced ferrochromium, the smelters at Antalya and Elazig were assumed to oper- ate at full capacity for the production of only high-C ferrochromium. Etibank's plans to expand capacity at the Elazig smelter to 100,000 tpy were incorporated, and the estimated capital cost of this expansion was prorated to the Etibank properties that feed it. Cost determinations included all processing and transporta- tion costs to produce and deliver ferrochromium FOB the ports of Antalya and, in the case of the Elazig smelter, Iskenderun. The results underscore the basic competitiveness of the Turkish ferrochromium industry. The cost deter- minations ranged at the breakeven point from $0.22/lb to $0.30/lb ferrochromium, averaging $0.25/lb on a weighted-average country basis. This equates to an average of $0.39/lb of contained Cr. At the 15-pct profitability level, the range and weighted-average cost of ferrochromium are $0.24/lb to $0.31/lb and $0.27/lb, respectively. In terms of contained chromium this equates to about $0.41/lb. The narrow range of these two profitability level cost estimates is indicative of a mature industry whose major historical cost in- vestments have been recovered and whose further ex- pansion is economically viable. The resources of the six operations analyzed could potentially provide the feed for an estimated 2,892,000 t of 65 pet high-C ferrochromium production. At capa- city utilization of both smelters this would represent about 26 yr of production. The mining operations of Etibank, if devoted exclusively to the production of ferrochromium, would account for 75 pet of this total. Currently, since Etibank owns both smelting facilities, it is the only producer and exporter of ferrochromium. It can be expected that Etibank, for the foreseeable future, will remain the dominant operating company in the Turkish chromium industry from mine output through ferrochromium production. It can further be expected that Turkey will continue to expand its ferro- chromium smelting capacity given its competitive position and the developmental and national income value-added benefits to be derived from increasing the capacity of downstream processing stages. It has been estimated (H, p. 100) that the value-added in Turkey from production of ferrochromium is approximately six times the value-added of salable (run-of-mine) ore and 4.7 times the value-added of salable chromite con- centrate. In addition, the "charge on external trade bal- ance" is 4.9 times greater and the estimated "effect on activity and employment in other sectors" (i.e., multiplier effect) is 30 pet for ferrochromium produc- tion versus 5 pet for the production of chromite ore and concentrate products. Turkey's main export markets are Europe and the United States. Given that this country is the main world source of high-grade metallurgical chromite outside of Zimbabwe, Albania, and the U.S.S.R., de- 54 mand for its chromium products should continue. How- ever, the demonstrated resource herein evaluated will last, at most, up to 33 yr at this study's assumed min- ing capacity of 621,000 tpy of crude ore. The resource tonnages at some individual mines will last only 7 jrr without additional tonnages being proven out. In con- trast to southern Africa, where conservatively esti- mated resources will last for hundreds of years, there would appear to be a trend, albeit a long-term one, for the Turkish chromium industry to decline relative to these producing nations. But the potential for proving further resources is there; the question is more one of importance as a major international supplier of chromite and ferrochromium rather than one of the continued existence of a domestic Turkish industry, for as this analysis shows, Turkey is cost competitive at this point in time. SUMMARY • A total of 11 million t of in situ demonstrated chromium-bearing resource was cost evaluated. • This resource is estimated to contain 7.6 million t of recoverable high-Cr chromite products with a weighted average grade of 46 pet CrgOg. • Total grade-A, high-C ferrochromium potentially available from this demonstrated resource is esti- mated at 2,892,000 t. • Chromite production cost (as defined) was esti- mated at $99.50/t of product on a country-wide, FOB port basis with mine operating cost account- ing for 35 pet, mill operating cost 5 pet, and trans- portation cost 60 pet of the total. • High-C ferrochromium production cost (as de- fined) was estimated at $0.39/lb of contained Cr at the breakeven level and $0.41/lb at the 15-pct profitability level. • Major implications are that full capacity produc- tion of ferrochromium (including expansion plans) would exhaust this static resource estimate in 26 yr ; the potential for proving additional chro- mite resources is considered good; and ferro- chromium production and export should increase as chromite exports decrease. THE PHILIPPINES GEOLOLGY AND RESOURCES It is estimated that 3.8 pet of the land area of the Philippines is covered by ultramafic complexes and serpentine rock, which are typical host rocks for chro- mite deposits. This equates to about 11,500 sq km of area. With such a large distribution of host rocks it is not surprising that the Philippines has a large num- ber of chromite occurrences and/or deposits (see fig. 24). Table 32 gives the geographic distribution of chromite deposits and occurrences as of 1976, accord- ing to Bacuta U5, p. 1). Of the total deposits-occurrences shown in table 32, 84 pet are located in the five provinces of Dinagat, Table 32. — Distribution of chromite deposits or occurrences In the Philippines Region and province or island Nuntber of deposits or occurrences Luzon Island: Zambales 62 Pangasinan 3 Tariac 1 Queson 1 Camarines Sur 3 Central Philippine Islands: Palawan 14 MIndoro 13 Samar 8 Homohon 4 Dinagat 8 Mindinao Island: MIsamIs Oriental 3 Bukidnon 1 Oavao Oriental 4 Total 125 Source: Bacuta {45, p. 1). Mindoro, Palawan, Samar, and Zambales; and Zam- bales Province contains approximately 50 pet of all occurrences. To show the inordinate importance that a few individual chromite operations can have, Bacuta estimated U5) that during the period 1946-76, 40 pet of total metallurgical-grade chromite production came from the Acoje mining operations and 94 pet of refractory-chromite production came from the Coto mining operations, both in Zambales province. Figure 25 shows the location of the current and proposed operations analyzed in this study. In 1976, reserve estimates for the Philippines were set at 4 million t of metallurgical-grade chromite and 7.8 million t of refractory-grade chromite (45, p. 2). At the time these estimates were published, it was pointed out that at current (1976) production rates these tonnages would be depleted within 20 to 30 yr. Because of this, the Philippines Bureau of Mines in- stituted a program during the late 1970's with three major aims: (1) reconnaissance geologic mapping of the country's ultramafic complexes; (2) canvassing and inventory of all chromite occurrences; and (3) geologic, mining, and beneficiation investigations of low-grade alluvial, eluvial, and lateritic chromite de- posits. The emphasis on low-grade chromite resources was intended to alleviate the chronic mining reserve problems caused by the relatively small sizes of high- grade, metallurgical-grade, podiform-tjrpe deposits. Indeed, the current results of the program indicate that the potential for large, low-grade chromite de- posits is great. As table 33 indicates, approximately 178.5 million t of low-grade resource, at the demon- strated level, is available for exploitation in the Philip- pines. On a crude-ore basis, this represents about 86 pet of the total demonstrated resource level. However, 55 tSLum z LEGEND O City and /Of port ^ Higlt-^irail*, metotlurgical chromite deposit and /or mine ▲ Low-grade, metallurgical chromite deposit and /or mine a Refroctary^ro^ chromite mine and 00 200 300 400 Scale, km % Ophiolite belt Figure 24. — Ophiolite belts and low- and higli-grade, metallurgical- and refractory- grade chromite deposits-operations In the Philippines. because the grade of these deposits averages a very low 2 pet, the amount of contained CrgO,, represents less than one-third of the country total. This study estimates the demonstrated resource level for high- grade, metallurgical and refractory-grade chromite at, 12.3 and 16.9 million t, respectively. The in situ grades for these resources are markedly higher, but when in- cluded with the low-grade material on a total, country- wide basis, the Philippine resource grade averages a low 5.6 pet CrjO,, owing to the large tonnage of low- grade material. However, the operations listed in table 33 do not represent all of the operations and deposits that the Philippine Bureau of Mines officially carries as its own resource base. Their base also includes another 21 high-grade metallurgical deposits contain- ing a total of 1.8 million t of ore and 12 refractory- grade deposits containing a total of 1.1 million t of ore. The average-sized resource for operations and deposits not evaluated in this study is 86,000 t for metallurgical-grade operations and deposits and 92,000 t for refractory grade operations and deposits. Because of the small sizes and/or lack of information, these operations and deposits were not evaluated for this study. The chromite resource specifications of the Philip- pines vary considerably. Cr:Fe ratios range from a low of 1.3 at Llorente to a high of 3.2 to 1 at Acoje and Narra. CrgO,, grades range from a low of 1.3 pet, also at Llorente, to a high of 44.6 pet at Lagonoy. Refractory-grade chromite resources are almost en- 56 ZAMBALES PROVINCE 3\ 100 200 300 400 LEGEND O City and /or port X Chromite deposit and/or mine Cj Ferrochromium smelter (proposed) Figure 25. — Location of chromite deposits-operations and the proposed ferrochromium smelter In the Philippines. tirely located in the Coto-Masinloc mining properties in Zambales province. The Masinloc property is lo- cated about 10 km south of the Goto operations, and when in production, its ore is sold to and processed through the Goto mill. For this reason, its demon- strated resource of approximately 0.5 million t of 34 pet CrzOg is reported along with the Goto operation. In addition, the total demonstrated resource figure in- cludes a major, new, underground, low-silica deposit, within the area of Government Mineral Reservation Number 1 U6) . This mineral reservation has historic- ally been included in the Goto reserve-resource esti- mates because the chromite is mined on a royalty basis by the operating company at Goto. The total tonnage at the main Goto operation is contained within ap- proximately 17 separate ore bodies or lenses with over 80 pet contained within only 6 of the ore bodies. A summary of resources and future prospects indi- cates that if no major technological or economic prob- lems arise in mining or beneficiating the low-grade material, then the near-term prospects for the Philip- pine chromite industry are bright. The tonnages this study has identified are very large and show that by intense geological investigation of only five deposits of low-grade eluvials, placers, and beach sands, the Philippines has greatly increased its demonstrated chromite resource level over the last 6 yr. However, the product from these low-grade ores is invariably of a low Gr:Fe ratio suitable only for the production of grade-G charge ferrochromium. The outlook for addi- tional discoveries is excellent, given the large propor- tion of land mass that contains favorable host rocks for chromite. However, for the metallurgical portion of the country's chromite industry it is apparent that the problem of small-sized, high-grade deposits will remain and that no vast increase in this t3T)e of chromite resource should be anticipated. As for refractory chromite resources, the prospects for the next 10 yr are directly tied to the prospects of the Goto operation, which has been the single largest refractory-grade chromite producer in the world for the last 36 yr. Prospects for additional discoveries of refractory-grade chromite are better than for metal- urgical-grade because refractory predominates over metallurgical-grade ore bodies in the primary chromite occurrences of the Philippines. However, the same problem of small-sized ore bodies also affects refract- ory-grade operations. The exceptions are the few large 57 Table 33. — Estimated In situ chromlte resource data for selected Philippine deposits and operations as of 1980 _, .. .• _ e»-,. „i Demonstrated Weighted-average Contained^ Cr.O,, Identified resource', Deposit-operation name Status' resource, lO^t grade, pet Cr^o; tO't 10't High grade:* Masdang Exp 4,500 32.5 1,462 4,500 Narra P/S 4,130 35.5 1,466 4,130 Acoje (Santa Cruz) P/S 2,850 18.4 524 2,850 Candelaria Exp 650 35.0 227 710 Lagonoy P/S 109 45.0 49 109 Siiangin P/S ^62 19^5 12 80 Total or average 12,301 ^30.3 3,740 12,379 Low grade;^ Llorente Exp 124,700 1.3 1,621 124,700 Bicobian Exp 48,220 3.3 1,591 48,220 Batang-Batang Exp 2,627 5.5 144 5,940 Bacungan Exp 1 ,671 7.0 117 3,840 Irahuan Exp 1,277 6£ 84 1,277 Total or average 178,495 '2.0 3.557 183,977 Refractory grade:' Coto-Masinloc P/S 16,785 26.0 4,364 16,785 Kinmalgin P/S 175 3^2 55 175 Total or average 16,960 ^26^0 4,419 16,960 Grand total or average . . . . 207,756 ^5.6 11,716 213,316 ' Status as of January 1981 : P/S-producing or on standby status: Exp-explored prospect. ^ Data may not add to totals shown because of averaging and independent rounding. ' Identified tonnage equals demonstrated plus Inferred tonnage; where equal, there was insufficient Information to support an Inference beyond the demonstrated level. * CrjOj, > 15.0 pet; AljOj, < 20.0 pet. 5 Not cost evaluated. * CrjOj, < 15.0 pet; AljOj, < 20.0 pet. ' AljOj, > 20.0 pet. ° Grade Is the In situ weighted average, within group at the demonstrated level. ' Country grade is the in situ weighted average over all deposits at the demonstrated level. ore bodies that have been found in the vicinity of the Coto operations. MINING AND BENEFICIATION Chromite mining in the Philippines ranges from en- tirely surface methods, to combinations of surface and underground methods, to entirely underground meth- ods. Table 34 summarizes pertinent data and assump- tions used in the analysis of the Philippine properties included in this study. As shown, nine properties were costed as utilizing surface mining only, two (Acoje and Coto-Masinloc) were costed using a combination of surface and underground methods over the mine lives, and only one small operation (Lagonoy) was evaluated based on utilizing only underground mining methods. Of the entire 207,756,000 t of chromite-bearing ma- terial estimated to comprise the demonstrated resource for the Philippines, 93.3 pet is considered to be min- able by surface methods, while only 6.7 pet is estimated to require underground methods for extraction. How- ever, in terms of contained CrgO,, the percentages change slightly to 87 and 13 pet, respectively. There are many reasons for the preponderance of surface mining in the Philippine chromite industry. First, 86 pet of the evaluated chromite-bearing ma- terial occurs as low-grade beach sand, eluvial, alluvial. Table 34. — Surface mining data for selected Philippine chromite operations T „, „„„ .^ .„, „i Surface minable Percent of recoverable w , -^ ^ ^,^lno\Zn«^«^nn resource tonnage, resource mined by ^^^X''^^^^'^' Concentration and deposit-operation' ^^3, surface methods 10' t mined ratio High-grade, metallurgical: Masdang 4,500 100 180 1.7 Narra 4,130 100 259 1.5 Acoje (Santa Cruz) 1 ,600 56 200 6.6 Candelaria 650 100 65 1.8 Low-grade, metallurgical: Llorente 124,700 100 4,500 45.0 Bicobian 48,220 100 1,371 19.0 Batang-Batang 2,627 100 252 10.0 Bacungan 1 ,671 100 300 8.0 Irahuan 1,277 100 115 8.0 High-grade, refractory: Coto-Masinloc 4,196 25 348 3.5 Kinmalgin 175 100 _18 i.o Total 193,746 NAp 7,608 NAp NAp Not applicable. ' Sllangln deposit-operation (listed In table 33) not analyzed for costs, owing to small resource tonnage. Yearly capacity, 1 0' t product 104 170 100 18 58 or lateritic deposits, occurring on the surface with little or no overburden. Second, the vast majority of the known high-grade (metallurgical) podiform deposits in the Philippines outcrop but do not extend to great depths. Third, surface mining methods make it easier to follow the erratic trend of typical Philippine podi- form deposits. In fact, surface mining is considered to be an important exploration method in the Philippines due to the variable shapes, attitudes, and mineraliza- tion of chromite occurrences W) . Fourth, in many cases the color of the dunite host rock is difficult to distinguish from the chromite ore, and surface mining helps to allevite this problem. In general, it appears that an effective economic limit to surface mining of chromite ore bodies in the Philippines is around 4 t of waste to 1 t of ore. At this stripping ratio and beyond, it is probably more economic, in terms of the mine operating cost, to select an underground method although other considerations such as reserves, volume, and production requirements should also be considered. Surface Mining Ten of the 11 surface mining properties selected for complete engineering cost evaluation in this study are, or are proposed to be, relatively large operations on a crude-ore basis by world chromite industry standards. Capacities for 10 of the 11 properties range from 65,000 to 4.5 million tpy of crude ore. Only one of the properties, Kinmalgin, with a capacity of 18,000 tpy of run-of-mine ore, has been analyzed as a labor in- tensive "camote-type" mine. The others have been analyzed as mechanized surface mines with some manual activities incidental to the major operation. These operations fall into two categories — those that mine high-grade, podiform-type deposits with rela- tively small lateral dimensions but extensions to depths >5 m, and those that will mine low-grade beach-sand, alluvial, or eluvial deposits with large lateral dimen- sions and shallow depths (<5 m). The Acoje (Santa Cruz) , Candelaria, Coto-Masinloc, Masdang, and Narra properties are in the first category while Bacungan, Batang-Batang, Bicobian, Irahuan, and Llorente are of the second type. "Camote-type" mining is a local term used to des- cribe any small-scale, labor-intensive, unsystematic method of mining. It can be used to describe both surface and underground operations. This method developed due to the nature, size, erratic mineraliza- tion, and remoteness of chromite deposits in the Philippines. Common hand tools such as wheelbarrows, shovels, picks, and pris-bars are used in camote-type mining and mechanization is minimal, usually consist- ing of a bulldozer for major cleaning or stripping and small trucks for transport of product. Where the ma- terial is amenable, no drilling or blasting is done. Instead, bulldozers or, more commonly, hand tools, are used for breaking the rock. The camote-type method is only suitable for small- scale mining of high-grade, shallow occurrences with an erratic trend to mineralization. It is usually chosen by a company with little or no capitalization. The advantage, at least in terms of the operating cost to produce a final product, is evident at the Kinmalgin operation where the mine operating cost per ton of salable product is only 16.5 pet of that estimated for the other properties on a weighted-average basis. Productivity with this mining method is very low, estimated to be 0.5 to 1 t per worker-shift. The Kin- malgin property is one of the largest camote-type mining operations possible, and as such, has been as- sumed to be at the upper end of the productivity range. It is estimated that with camote-type mining, 75 to 85 pet of the mine operating cost consists of direct labor. As expected, capital costs are very low. Exploration and development costs are usually part of the normal mining cost. It is roughly estimated that the cost of mine equipment, mine plant, and infra- structure capital costs should be about $7/t of annual capacity for an average small-scale, camote-type sur- face operation. Nine of the remaining 10 mechanized operations are hillside or level strip-bench operations. Clearing of vegetation and initial stripping for development and exploration purposes is accomplished with bulldozers. Waste and ore extraction is most often done by front- end loaders, back-hoes, or "traxcavators" of 0.5- to 3-cu m capacity, which load into small rear-dump trucks of about 10- to 15-t capacity. Exceptions to this description are the Coto-Masinloc property where 0.5-cu m shovels have been used for excavation and loading, and the proposed Bicobian and Llorente opera- tions, where 30-t trucks are proposed for handling ore and waste. Waste material from stripping and mining operations is either pushed aside or transported short distances from the pits. Because the mining will follow the trends of the ore bodies, a variety of pit shapes occur, resulting in oval, semioval, circular, tunnel, or U-shaped plan views (^7) . The number of benches will vary depending upon the number of chromite exposures and the trends of the ore bodies. Usually two to six benches are required. According to Bacani (47), bench widths range from 3 to 5 m in smaller operations and 5 to 8 m in larger operations. Bench heights range from 3 to 6 m in the small mines and 5 to 12 m in the larger pits. Bench sjopes range from 48° to 65°, and haul roads grade 1 to 5 pet. Water drainage generally poses no problem, being handled by digging canals or ditches at the sides and/or toes of the benches. Productivities of these operations are estimated to range from 1 to 1.5 t of crude ore per workershift. The Batang-Batang property is proposed to be a hydraulic operation. The engineering evaluation is based on a preliminary study done in 1978, which proposed a hydraulic operation because the chromite is disseminated in fine sands and clays. Hydraulic monitors will direct a slurry to a prepared sump pit for pumping to a mobile screening plant, which will in turn feed a stationary gravity-magnetic separation plant. Table 35 shows the percentage breakdown of capital cost estimates for nonoperating surface mines in the Philippines. The total investment required to bring the proposed operations into production is apportioned between three categories; exploration-development- infrastructure capital costs; mine equipment capital Table 35. — Percentage breakdown of total estimated surface mining capital Investment required for developing Philippine chromlte deposits Type of material and Capital investment to develop, pet of total' deposit-operation name^ E-D-l^ Mine equipment Mine plant High grade: Masdang 63.0 32.0 5.0 Candelaria 52.0 46.0 2.0 Low grade: 27.0 69.0 4.0 21.0 66.0 13.0 Batang-Batang 29.0 57.0 14,0 Bancugan 39.0 58.0 3.0 Irahuan 51.0 40.0 9.0 ' Explored. M981 U.S. dollars. ' Exploration, development, and infrastructure. costs; and mine plant capital costs. As the data indi- cate, there are significant differences in total invest- ment required to initiate production for the proposed low-grade and high-grade operations. In general, the low-grade eluvial deposits require a smaller percentage of exploration-development-infrastructure investments (an average of 33 pet) than the high-grade deposits (58 pet). Mine equipment accounts for the bulk of mine capital investments for the low-grade deposits, with an average of 58 pet versus only 39 pet of total investment attributable to mine equipment for the high-grade deposits. On average, mine plant invest- ment requirements constitute a very small proportion of the total investment for both types of deposits, averaging 9 pet for the low-grade and 3.5 pet for the high-grade deposits, respectively. Of particular note is the relatively small total capital investment required to develop a world-class-size sur- face chromite mine. The average estimated output, in terms of final product, for the seven currently non- producing operations evaluated in this study is 56,000 tpy of concentrate, which can be brought into produc- tion for an average of around $8 million in total mine investments. Underground Mining Only three of the operations evaluated for this study have been costed on the basis of partial or complete production by underground mining methods. Pertinent data resulting from the study for the three operations is listed in table 36. Of total recoverable demonstrated resources, approximately 6.7 pet is minable by under- Table 36. — Underground mining data for selected Philippine chromlte operations (high grade) Metallurgical Refractory: Aco^ (Santa Lagonoy Coto-Masinloc Minable resource 10^ t.. 1,250 109 12,589 Recoverable resource'... pet.. 44.0 100.0 75.0 Annual capacity, 10^t: Mine production 160 5 1,044 Recoverable product* 87 5 297 ^ Pet of total demonstrated resource recoverable by underground mining methods. ' Output of upgraded ore in the form of concentrates. ground methods. This tonnage represents 13 pet of the total contained CrgOg. The Lagonoy property has been, and probably will continue to be, mined as a very small-scale, camote- type underground operation of around 5,000 tpy of crude ore. The Acoje (Santa Cruz) underground operations are large scale by Philippine standards, although the resource tonnage estimated to be minable by underground methods is only 44 pet of the total for the property. The Coto-Masinloc operations are the largest underground chromite mining operations in the country, estimated to have an underground mining capacity of 1.044 million tpy of crude ore. Production from the underground resource tonnage analyzed at Coto-Masinloc comes from five or more ore bodies and is highly mechanized. It is estimated that 75 pet of the total resource available at the Coto-Masinloc properties will have to be mined by underground methods. According to Bacani (47), prior operations at La- gonoy consisted of scattered adits and some shafts to allow access for the miners to follow the "veins" (ore bodies), extracting ore as they proceeded. Tim- bering, drilling, and blasting were necessary, but mucking was done with wheelbarrows. This camote- type, underground mining method is very labor inten- sive, with very low estimated productivities of 0.25 to 0.5 t per worker-shift. The mining methods at Acoje (Santa Cruz) and Coto-Masinloc are basically very similar; the method is officially referred to as "top slicing." Horizontal slices of ore, 2.5 to 3 m thick, are extracted after block- ing out by development drifts and raises. At Acoje (Santa Cruz), successive slices are taken from the top to the bottom (underhand slicing) while at Coto- Masinloc the slices proceed from bottom to top (over- hand slicing). The first system develops into what essentially is a "caving" operation while the second system (at Coto-Masinloc) requires sand filling with mill tailings as mining progresses upward. Scrapers and hand-tramming seem to be the preferred methods of haulage in the stoping areas while main haulage is by diesel locomotives. At present, the most common access method for the large scale mining of large ore bodies is by vertical shaft. Productivities for these large-scale operations are estimated at 5.5 t per worker- shift and are very high in comparison with other chromite operations throughout the world. Mine operating costs at these three underground operations are not significantly different. The mine operating cost at Lagonoy is slightly less than the other two due to the lack of need for a significant amount of stope development. The small difference in mine operating costs between Acoje (Santa Cruz) and Coto-Masinloc is due to better scale economies at the latter. For the camote-type mining (at Lagonoy), it is estimated that labor accounts for 75 pet of the total mine operating cost, with 15 pet comprised of materials and supplies, and 10 pet representing equip- ment costs. For the large-scale underground opera- tions, the relevant percentages are labor, 20 pet; ma- terials and supplies, 30 pet; and equipment operation, 50 pet. Of this latter 50 pet, half is attributable to energy costs. 60 General Operational Problems A number of operation problems need to be men- tioned in relation to the chromite mining industry in the Philippines because of the major impact they could have at any time on production capabilities. First, adverse weather conditions, particularly very heavy rains, not only affect normal surface mining operations but can also seriously affect negotiation of haul roads from the mine to mills or stockpiles and to port fa- cilities. Road washouts and high water levels at asso- ciated river crossings could also halt haulage opera- tions, especially to port facilities. Second hand or old equipment is commonly used at the mines (most often at the smaller mines), and availability of mechanized equipment is sometimes a constraining factor. In addition, remoteness of the mines and the associated lack of good facilities in the mining camps makes recruiting of technical and skilled workers difficult. This remoteness also creates communication difficul- ties as well. The above points and related issues are covered in greater detail in Bacani U7). BENEFICIATION Table 37 lists pertinent technical data oh bene- ficiation of chromite ore in the Philippines for the 10 metallurgical-grade properties evaluated for potential production of high-C ferrochromium. The resources of the first five properties listed are considered to be high-grade at 18.6 to 45 pet CrjOa in the mill feed, while the resources for the last five are considered to be low-grade at 1.3 to 7 pet CrgOa in the mill feed. The five high-grade resource operations represent a total mill-feed capacity of 920,000 tpy of crude ore to produce 432,000 tpy of concentrate products. The con- centration ratio for these high-grade resources aver- ages 1.8, on a weighted basis. Methods used to bene- ficiate the high-grade ores range from a simple, labor- intensive, wash-handsort operation at Lagonoy, to gravity separation with a combination of spirals and tables at Acoje (Santa Cruz) and Candelaria, to grav- ity separation with spirals, tables, and jigs at Narra and Masdang. Estimated mill recoveries range from 75 to 100 pet of the contained CrgOa, and concentrate grades range from 45 to 48 pet CrgOg. Of the total estimated actual or proposed production from these five operations, only about 17 pet could be considered as lump product, with the remaining 83 pet in the form of concentrates. The five low-grade-resource operations represent a total mill-feed capacity of 6.537 million tpy of crude ore to produce a potential product of only 250,000 tpy of concentrate, which results in a very high ratio of ore mined to concentrate output of approximately 30 to 1. Proposed beneficiation methods for the low-grade ores do not vary significantly. All involve a combina- tion of gravity separation with spirals and tables followed by high-intensity magnetic separation. The only significant difference is the preparation of ore prior to gravity separation where methods range from a slurry-screen-classify operation at Batang-Batang to full crush-grind-screen-classify preparation for the lateritic material at Bicobian. Estimated CrgOg re- coveries for the low-grade ores range from 80 to 90 pet, with concentrate-product grades ranging from 45 to 50 pet CrjO,. All product output will be in the form of concentrates. The weighted-average mill operating cost on a crude-ore-feed basis for the low-grade deposits is 42 pet lower than for the high grade. However, on a per- ton-of -product basis the weighted-average mill operat- ing cost for the low-grade resource operations is esti- mated to be very high, approximately 10 times greater than the corresponding figure for the high-grade re- source operations. This is the single most negative fac- tor mitigating against production of chromite concen- trates from these low-grade resources. If, for example, a deposit requires 25 t of material mined to produce 1 t of beneficiated product at an estimated $1.00/t of feed, and this cost were to increase by only $0.25/t, then the cost of product would increase by $6.25/t, or 25 times the increase/t of material mined. In what is normally a stable market for chromite concentrates, this increase could seriously affect the profitability of the operation and certainly represents an additional risk that high-grade resource operations ai-e not as seriously exposed to. This economic difference between the high-grade and low-grade chromite resources of the Philippines is graphically demonstrated in figure 26 and fully explained in the following availability discussion. Table 37. — Technical data on beneficiation of Philippine chromite Deposit-operation Type of ore Recovery, pet Grade, pet CrPj Capacity, lO^tpy Type of product output Feed Concentrate product Feed Product Masdang High grade (44 pet), low grade (56 pet). 85.0 Narra do 85.0 Acoje do 85.0 Candelaria do 75.0 Lagonoy do 100.0 Llorente Low-grade eluvial, sandy 80.0 Bicobian Low-grade eluvial, lateritic. 85.0 Batang-Batang . . . Low-grade eluvial, (100 pet sand, clay, gravel). 83.0 Bancungan Low-grade soil (93 pet), rock (7 pet). 90.0 Irahuan Low-grade sand (85 pet), banded (1 5 pet). 83.0 32.5 48.0 180 103 100 pet concentrate. 35.5 46.0 260 171 40 pet lump, 60 pet concentrate. 18.4 48.0 360 117 100 pet concentrate. 35.0 48.0 65 35 Do. 45.0 45.0 5 5 100 pet lump. 1.3 45.0 4,500 98 100 pet concentrate. 3.3 50.0 1,372 73 Do. 6.0 44.0 250 25 Do. 7.0 49.0 300 39 Do. 6.6 44.0 115 13 Do. 61 CHROMITE AVAILABILITY There are very distinct economic differences between the operations evaluated. Most apparent are the wide- ranging operating and transportation costs per ton of salable product. Figure 26 and the data in table 38 detail the differences in mining, processing, and trans- portation costs for the high- and low-grade metallurgi- cal resources. For the high-grade (nonrefractory) re- source operations, actual or proposed mine operating costs /t of product lie in a range of from approximately $15/t to $53/t, with a weighted average of $22.50/t. For the low-grade resource operations, all of which are either nonproducing or in the initial exploitation stages, mine operating costs per ton of product are estimated to be 50 pet higher on a weighted-average basis even though all are surface mining operations. This is due primarily to very high concentration ra- tios, estimated to average 30:1 for the low-grade resources and only 1.8 :1 for the high-grade resources. As mentioned previously, mill operating costs on a per-ton-of-concentrate-product basis are 10 times greater for the low-grade as opposed to the high-grade resources, again primarily as a result of very high concentration ratios. Transportation costs, when put on the same basis, are 60 pet greater for the low-grade resources, entirely because of greater transportation distances. The total estimated cost per ton of chromite product, FOB ocean transport, stands at $35.50/t for 1.8 30.0 15.3 $22.50 5.50 7.50 $ 33.50 55.50 12.00 $28.00 29.50 10.00 Table 38. — Estimated mining, milling, and transportation costs per ton of chromite product, and total chromite product availability, by resource type, for the Philippines (1981 U.S. dollars) High-grade Low-grade Total Ore-concentrate ratio Weighted-average cost per metric ton of concentrate: Mining Beneficiation Transportation' Total cost, f.o.b. port 35.50 101.00 67.50 Total chromite potential 1 0^ t . . 6,200 5,91 2 1 2, 1 1 2 Weighted-average grade CrPj. ..pet.. 47 48 47 ' Includes handling charges. the high-grade resources and $101/t for the low-grade resources, or 284 pet greater. Clearly, the high-grade resources of the Philippines are very competitive on a worldwide basis and are vastly superior economically to the low-grade resources. Factoring all of this in- formation into a single country statistic would place the Philippines at a total weighted-average cost (FOB) of approximately $67.50/t of chromite product. If a cutoff point of $65/t of product (FOB) were chosen to determine overall export competiveness, then approximately 50 pet of the total estimated potential 12.1 million t of chromite products would meet this criterion. Of this total, 90 pet would be from high- grade resources and 10 pet would come from the low- grade resources. TOTAL RECOVERABLE CHROMITE, iO^t Figure 26. — Estimated mining, milling, and transportation costs per ton of chromite product, and availability of chromite from selected operations In the Philippines. 62 If all (non-refractory-grade) deposits and proper- ties evaluated were developed and operated at esti- mated full capacity, they would represent a total com- bined mine output of 7.4 million tpy of chromium- bearing resource yielding approximately 682,000 tpy of chromite products. On a weighted-average basis, this represents an overall concentration ratio of ma- terial mined to product output of 15.8, which is ex- tremely high because the majority of potential re- sources are of a very low grade. The beneficiated- product grades range from 44 to 68 pet CrjOs with a countrywide average of about 47 pet. For the com- bined high- and low-grade (nonrefraetory) demon- strated resource level of 190,8 million t, it is estimated that a potential 12.1 million t of 47 pet CrgOg products could be produced. Using the 1980 reported and esti- mated mine capacity production estimates this would represent productive mine lives of from 6 to 36 yr. The refractory-grade properties contain an esti- mated 3.95 million t of recoverable chromite concen- trate, 99 pet of which is contained within the Coto- Masinloc operation. This equates to approximately 396,000 tpy at capacity operation, with the demon- strated resources at Coto-Masinloc sufficient for about 10 yr of production at current capacity. The Philippines has the shortest inland trans- portation distances, and with countrywide average transport costs of $10/t, is the least expensive of the major producing countries. The chromite operations currently producing or proposed are located on several different islands and generally truck the chromite to a nearby portage for either direct loading or barging to the ocean freighter. With the exception of the 50,000- tpy proposed ferrochromium smelter in Cagayan de Oro, the great majority of chromite will continue to be exported. Given the reliance upon short-haul truck- ing, the cost and availability of which is borne by the mining concern, no major transportation infrastruc- tural problems are evident in terms of cost, but the overall capacity of the transportation system is quite limited. Currently, the major export markets for Philippine chromite are the United States, Western Europe, China, and Japan, At this time, a number of factors point to an increase in sales to the Japanese ferro- chromium industry. Among these factors are, the geographical proximity of the Philippines to Japan and the lower transport costs this implies, the cost competitiveness of its high-grade resources vis-a-vis other competing suppliers, and the need on the part of the Japanese ferrochromium manufacturers to con- serve electric power consumption and costs; this fav- ors Philippine high-grade material because the high Cr:Fe ratio of this resource helps reduce power con- sumption and cost, since less material is required to be smelted/t of product. There are real constraints, however, on the absolute size of potential Philippine chromite sales to Japan (or its other markets) given the problems of limited high-grade reserves and its relatively limited ship- loading facilities. It is doubtful, given present cir- cumstances, that the Philippines could ever replace South Africa, quantitatively, as a major chromite supplier to either the United States or Japan, The major significant factors to monitor in this re- gard are the quantity, quality, and cost competitive- ness of the relatively large low-grade resources herein evaluated. But again, even these somewhat optimistic resource estimates pale in comparison to the known reserves of South African chromite. HIGH-CARBON FERROCHROMIUM AVAILABILITY Historically, the chromium marketing situation in the Philippines has been centered entirely around the export of chromite ore and concentrate products. Refractory-grade chromite has held a majority posi- tion in total chromite exports, while the smaller tonnage exports of metallurgical-grade chromite have primarily gone to the Japanese ferrochromium indus- try. In 1976, Ferro-Chemicals Inc. began producing high-carbon ferrochromium from its small, 12,000-tpy plant in Misamis Oriental Province on the island of Mindanao. The raw material is obtained from most of the country's high-grade producers. Because the plant's output is very limited, primarily for domestic consumption, and it was unclear where the smelter's ore-concentrate feed sources were, this plant was not evaluated here. There has been recent advanced planning on the part of Acoje Mining Co. of the Philippines and Voest Alpine (Austria) to construct a 50,000-tpy ferro- chromium plant to produce (65 pet contained Cr, grade A) high-C ferrochromium using local chromite con- centrates (i8, p. 209). This will doubtless reduce the amount of metallurgical-grade chromite available for export and will add to the chromite import problems of Japanese ferrochromium smelters, while providing direct competition to their ferrochromium products. In order to ascertain the economic potential of this endeavor the total cost estimate of the ferrochromium plant was incorporated into a cost determination evaluation based upon one currently nonprodueing mining operation supplying all concentrate feed re- quirements. The results (table 39) point favorably to the development of this facility. To cover total in- vestment costs from mine development through the construction and operation of the ferrochromium plant Table 39. — Per pound of contained chromium cost and potential availability estimates, by ferrochromium product grade, for the Philippines (1981 U.S. dollars) NAp Not applicable. ' FOB-Japan-market basis, includes all chromite and ferrochromium transportation and handling costs. ^ FOB export point, includes all chromite and ferrochromium handling and transportation costs. ^ Items in parentheses not included in Total". Type Weighted average cost Breakeven 15-pct .Total potential ferrochromium, 103 1 Pet Of total $0.37 .40 .40 .54 $0.49 .64 .45 .64 2,439 (1,172) 244 2,850 44.0 Philippine smelter model^ . Grade B' (21.0) 4.5 Grade C 51.5 Tota|3 NAp NAp 5,500 100.0 63 (and obtain a 15-pct rate of return on the invest- ments) would require a 1981 U.S. dollar price (FOB) of approximately $0.42/lb ferrochromium or $0.64/lb contained Cr. Assuming all chromite ore and concentrates suitable for the manufacture of high-carbon ferrochromium were to be carried through to this processing stage either in-country or in Japan, this ferrochromium facility would represent about 21 pet of the ferro- chromium production potentially available from Philippine demonstrated chromite resources. Its con- struction would represent a major structural change in the Philippine chromium industry, yet another step towards greater reliance by the steel industries of the major industrial countries on the supply of ferro- chromium from less industrialized nations and a con- comitant reduction in industrialized-nation ferro- chromium production capacity. It is thought at this time that the output of this plant will primarily be exported to China, which somewhat reduces the impact of direct competition to ferrochromium manufacturers in Japan alluded to previously, but still represents a reduction in available chromite supply to their ferro- chromium industry. The remaining nine actual or proposed (non-re- fractory-grade) operations were assumed to transport total mine and mill product output to Japan for proc- essing to high-C ferrochromium. These results under- score the attractiveness of Philippine chromite as a source of raw material supply to Japanese ferrochro- mium manufacturers. Given the general relationship between the Cr:Fe ratio of chromite and the grade of ferrochromium produced, the Philippine resources were apportioned 44 pet to the manfacture of grade-A, 4.5 pet to grade- B, and 51.5 pet to grade-C ferrochromium. The cost determinations at the breakeven level for the grade-A product averaged $0.24/lb ferrochromium, grade-B averaged $0.23/lb, and grade-C averaged $0.28/lb. On a per-pound-contained-Cr basis the weighted-average costs are $0.37, $0.40, and $0.54, respectively. The 15- pct profitability level analysis determined ferrochro- mium costs of $0.32/lb for grade-A, $0.26/lb for grade-B, and $0.34/lb for grade-C, which equates to per-pound-contained-Cr costs of $0.49, $0.45, and $0.64, respectively. These costs are all on a delivered- to-market-in-Japan basis (except for grade-A product category, which includes the operation feeding the Philippine smelter) and represent a general measure of the competitiveness of both the Philippine raw material and the Japanese and Philippine manufac- tured ferrochromium products. The grade-C product is that which is estimated to be available from the low-grade resources; its relatively higher cost is basically due to the higher cost of delivered low-grade chromite concentrates. The results of the analysis indicate that 5.5 million t of ferrochromium products are potentially recover- able from the demonstrated resources evaluated. Ap- plying the assumption of full capacity operation from mine through ferrochromium manufacture for all operations yields an average yearly availability esti- mate of 299,000 tpy. It needs to be emphasized that the issues discussed previously concerning production and shipping capa- city, limited high-grade reserves, and the ability to expand supply significantly, as they related to the availability of chromite products, hold at this further processing stage as well. At this point in time, the outlook for the future is more one of structural change (i.e., ferrochromium production versus chromite ex- ports) rather than one of significantly expanding the scale of the industry itself. SUMMARY A total in situ demonstrated resource estimate of 207.8 million t was cost evaluated. As shown in figure 27 the total resource tonnage is appor- tioned 86 pet to low-grade, nonrefractory re- source; 6 pet to high-grade, nonrefractory re- source; and 8 pet to the high-grade refractory resource type. The total (nonrefractory grade) demonstrated resource is estimated to contain a potential 12.1 million t of chromite products suitable for further processing to high-C ferrochromium. The product tonnages are as apportioned in figure 27. 6 pet High-grade metallurgical use 8 pet Refractory grade 207.8 xlO^t demonstrated resource 12.1 xlO^t chromium products (metallurgical use) Figure 27. — Composition of cost-evaluated In situ demonstrated resource and percent- age of total chromite potential attributable to low- and high-grade metallurgical resources In the Philippines. 64 5.5x10^1 high-carbon ferrochromium availability Figure 28. — Distribution of potential high- carbon ferrochromium avaiiabiiity estimates, by ferrochromium product grade, from the Philippines. Total high-C ferrochromium potentially available from this demonstrated resource is estimated at 5.5 million t, apportioned between product grade as shown in figure 28. Chromite production costs (as defined) are esti- mated to total $35.50/t for the high-grade re- sources, $101/t for the low-grade resource, and $67.50/t on a countrywide basis. The percentage contributions of mining, milling, and transporta- tion costs to the total operating cost for the high- and low-grade resources are given in figure 29. High-C ferrochromium production costs (as de- High - grode deposits Low-grode deposits Figure 29. — Percentage distribution between mining, milling, and transportation cost estimates (FOB port) for high- and low-grade metallurglcai resources, respectively, in the Philip- pines. fined) are estimated for the breakeven level at $0.37/lb contained Cr for all grade-A ferrochrom- ium products, $0.40/lb for grade B, and $0.54/lb for grade C. The planned ferrochromium smelter in the Philippines was estimated to break even at $0.40/lb contained Cr for the production of grade- A, high-C ferrochromium. Major implications are that, ferrochromium pro- duction in the Philippines will reduce the amount of high-grade metallurgical chromite available for export and represents a continuation of the trend toward ferrochromium production in those coun- tries that mine chromite ; secondly, the low-grade resources currently appear to be subeconomic both in terms of chromite and ferrochromium production costs. INDIA GEOLOLGY AND RESOURCES In 1975, India's total in situ demonstrated chromite resource was estimated at 17 million t. Recent work by the Geological Survey of India and the government's Mineral Exploration Co. has resulted in very large upward revisions of the total chromite resource ton- nage in India. The work involved reevaluation of re- sources at a cutoff grade of around 30 pet rather than the old standard of 40 pet CrjO,,, which was the basis for the total in situ estimate of 17 million t reported in 1975. The results of this program have only recent- ly been announced and then only in general terms. Total Indian chromite resources are now estimated to be 112 million t (49), 60 million of which is considered as "proven" (50, p. 454). It has been stated that 100 pet of the "new" additional resource is located in Orissa State — with 80 pet of this tonnage in the Cut- tack District, 10 pet in the Dhenkenal District, and 10 pet in the Keonjhar District (50, p. 459). These chromite resources represent about 98 pet of India's total known chromite resource with 96 pet located in Orissa State, and another 2 pet in Karnataka State. The resource in Orissa is essentially contained within two mining districts, Cuttack (Sukinda Valley) and Keonjhar. A third district, called the Dhenkenal, is located at the extreme southwestern end of the Sukin- da Valley and is considered as part of the Cuttack District for this study. A fourth district, Hassan, contains the resource of Karnataka State. For this study, the Bureau of Mines has estimated demonstrated in situ chromite resources at approxi- mately 81 million t with a weighted-average grade of 32 pet CrzOg (table 40) . Of this total, 16 pet is high- grade material averaging 43 pet CraO,, and 84 pet is low-grade material averaging 30 pet CrjOg. There is contained within this demonstrated resource approxi- mately 26 million t of CrjOg. Identified resources are estimated at 108.5 million t, the additional 24.4 mil- lion t being entirely of low-grade material. On a district basis, the total demonstrated resource tonnage is distributed 85 pet to Cuttack and 12 pet to Keonjhar district of Orissa State, and 3 pet to Hassan District in Karnataka State. On a property- by-property basis, this total tonnage represents the estimated resource contained in about 43 different ore bodies-deposits — 30 in Cuttack, 10 in Keonjhar, and 3 in the Hassan districts. The general indication now is that the majority of 65 Table 40. — Estimated in situ chromite resource data for selected Indian deposits, operations, and districts as of 1980 r, •. „.„„ ^:„,^^ , Demonstrated resource, Weighted-average Contained^ Cr.O,, Identified resource^ Deposit-operation-distnctname ,03, grade', pet CrA lO^t 10^1 Karnataka State: Hassan District: Byrapur 1,000 47.0 470 1,000 Jambur-Tagadur 1,500 35.0 525 1,500 Total or average Orissa State: Cuttack District: Low grade High grade Total or average Keonjhar District: Low grade High grade Total or average Orissa State total or average. . Grand total or average 81 ,230 "^2.0 26,000 108,500 ' In situ weighted-avarage at the demonstrated level. ^ Data may not add to totals shown because of averaging and independent rounding. ' Identified tonnage equals demonstrated plus inferred tonnage; where equal, there was insufficient Information to support an inference beyond the demonstrated level. " Country grade is the in situ weighted-average over all deposits at the demonstrated level. 2,500 40.0 1,000 2,500 59,200 10,120 30.0 43.0 17,760 4,352 83,160 10,120 69,320 32.0 22,180 93,280 7,410 2,000 30.0 40.0 2.223 800 10,720 2,000 9,410 78,730 32.0 32.0 3,011 25,000 12,720 106,000 India's chromite resource available for future mining consists of medium-grade, medium Cr:Fe ratio ma- terial suitable for the production of grade-B ferro- chromium. The overwhelming majority of this medium-grade material will have to undergo relatively sophisticated and more costly beneficiation, resulting in the proportion of fines to lump ore production dramatically increasing from the present estimate of 2:1. The possible potential beyond the tonnages men- tioned above is thought to be great. An unpublished report^s mentions that the total geologic potential in India could be as high as 700 million t of chromite- bearing material. The majority of this potential prob- ably lies in basically two areas : undiscovered deposits on the buried north limb of the Sukinda ultramafic syncline, and reevaluation of resources at an even lower cutoff grade than the present 30 pet CraOs- MINING AND BENEFICIATION According to the Tex Report (5i, p. 94), over 99 pet of total Indian production of chromite products during the mid- to late-1970's came from the Cuttack-Dhen- kenal, Keonjhar, and Hassan districts. Production amounts for a typical mining unit in India vary greatly from year to year. This is clearly illustrated by the Tex Report {51, p. 94), which identi- fied 22 "production units" with each "unit" usually consisting of several different quarries or pits. The mining methods in use are very labor intensive, which makes it easy to increase or decrease production rapid- ly as market conditions change. This flexibility also extends to the types of chromite products that are available from Indian chromite resources. For simpli- fication, the products can be organized into four basic "Confidential source. tjTpes: (1) high-grade fines and concentrates (>47 pet CrsO.O. (2) medium-grade fines and concentrates (35-47" pet CraO:,), (8) low-grade lump (35-40 pet Cr20:,),and (4) high-grade lump (>40 pet (CrA)- The purpose of the foregoing discussion is to point out the complexity of the Indian chromite industry both in terms of the consistency of mining plans and in terms of the variety of products available. This complexity requires a certain amount of simplification in order to evaluate overall Cr availability. When dealing with India, any estimate of future mine capa- cities, types of chromite resource to be exploited, grade of feed material, and final products to be pro- duced, is subject to a very high degree of variation over a time period as short as just 5 yr. The scenario proposed for this study of the Indian chromite indus- try exists within certain boundaries established by the specific large-scale-exploitation assumptions out- lined below. It must be emphasized that this large- scale development scenario could diverge significantly from actual future developments within the chromite industry. The purpose here is to evaluate the maxi- mum potential of chromite and ferrochromium prod- ucts potentiallly available from a fully developed In- dian chromium industry. Table 41 defines the mining units and summarizes the mining data estimated for this analysis. The min- ing units shown represent a composite of what will, in reality, be many different individual mining opera- tions. Therefore, all mine capacities, in situ resource grades, operating costs, capital investments, mining and milling recoveries, and product grades, represent weighted averages for the mining unit (district) as a whole. Only about 6 pet of the total demonstrated chromite- bearing resource is proposed to be extracted using underground methods, while 94 pet is expected to be recoverable by surface methods. Because the additional low-grade resource has been added mostly by decreas- ing the cutoff grade from 40 to 30 pet, substantial amounts of material previously ignored in prior sur- Table 41. — Estimated mining data as evaluated in this study, India Deposit-operation-district Type of mining technology Average stripping ratio, ton Labor productivity \ waste per ton ore per worker-stiift Estimated crude ore, lO^tpy Estimated total product capacity, 10'tpy High grade 100 pet underground (cut and fill). Low grade Open pit, semimechanized Cuttack-Dhenkanal: High grade do Low grade do Keonjhar: High grade 50 pet surface, 50 pet underground. Low grade Open pit, semimechanized Total NAp 6 0.20 .25 110 400 70 190 110 229 70 100 NAp Not applicable. ' Total mine labor plus staff. face operations would now be considered as economic- ally recoverable. The entire resource amenable to surface methods is estimated to have an average stripping ratio of ~7 over the entire life of the demonstrated resource evaluated for costs. In general, surface mining methods are not expected to change significantly from the labor-inten- sive, semimechanized pitting-quarrying operations in use over the last 30 yr. This method basically involves drilling and blasting of ore and waste, then excavation of waste, usually by front-end loaders, bulldozers, or small 1.5 to 2-cu m diesel shovels loading into very small trucks of about 5 t capacity. Manual labor is used for sorting, handling, and loading of ore and some waste. Ferro Alloys Corp. Ltd., (FACOR) does have plans to increase mechanization at its Bouala mine in the Keonjhar District, but operating costs are not expected to decrease significantly because the company expects the stripping ratio to increase by nearly 50 pet. Because estimated productivities using semi- mechanized surface mining are very low, 0.25 to 0.30 t per worker-shift, labor costs account for 70 to 75 pet of operating costs ; equipment operation comprises an estimated 15 to 20 pet ; while materials and supplies contribute only about 10 pet. Underground mining is presently in use at the Byrapur operation of Mysore Minerals in the Hassan District. At Byrapur, the mining method employed is cut-and-fill, taking overhand slices and using sand fill pumped from the surface ; access is thought to be by a series of adits and inclines. Timber support is required and operations are estimated at 300 d/yr, two shifts per day. Ore is hand trammed in small (1-t) cars, and mining is estimated to be not more than 200 m at depth; mining recovery is estimated at 90 pet. This study also assumes that underground mining will be required for about 50 pet of the high-grade resource in the Keonjhar District operations. The Keonjhar underground operations were assumed to be similar to that at Byrapur, except that fill material should con- sist of waste material rather than sand, and access would probably be via an inclined shaft system. The mining plan is predicated on an assumed mining width of 10 to 15 m. Labor productivity for underground mining, at 0.2 t per workershift, is estimated to be slightly less than for surface operations. Total underground operat- ing costs are, on average, around 50 pet higher than surface mining operating costs. Beneficiation of the chromite resource evaluated breaks down into two basic methods. The only bene- ficiation generally required for high-grade, chromite- bearing material is a hand-sort and screening opera- tion with essentially 100 pet recovery of the contained CraOg to produce a lump ore product and a fines ore product. For all the low-grade material it was as- sumed that the minimum amount of beneficiation re- quired would be two-stage jaw and roll crushing of material to minus 4-mm, sereening-washing-elassify- ing, and then two stages of gravity separation with flat and shaking tables. This is the method used at the Mysore Minerals pilot mill in the Hassan District, which has been in operation since 1977 or 1978. Studies of Orissa State's low-grade ores suggest that magnetic separation should probably be added for processing some of the Cuttack District low-grade material (52), but it is believed that this should be applied on an individual mine-deposit basis and not applied in an overall evaluation of the district. Overall recovery in treating low-grade material by gravity methods is assumed to be 80 pet. This recovery has been reported for the Hassan District pilot plant and is the expected recovery by FACOR at their Keonjhar District operations. However, lab-scale tests on seven different ores from both the Cuttack and Keonjhar districts had recoveries in the 60 to 85 pet range, hence 80 pet should be viewed as almost as high a recovery as can be reasonably expected. Estimated mill operating costs are composed of as much as 90 pet labor for the hand-sort-sereen method and about 25 pet for the gravity separation method. Equipment operation and materials and supplies each constitute about 10 pet of the costs in the hand- sort, screening method, while for gravity separation these two categories make up 40 and 35 pet, respective- ly, of the total cost. CHROMITE AVAILABILITY The potential availability of chromite ore and con- centrate products from the demonstrated resources of India is on the order of 43 million t, with an average grade of 46 pet CrjO,. This equates to a potential chromite availability of 543,000 tpy if all operations were producing at estimated capacity. This figure is only about 9 pet higher than peak production of 500,000 t in 1975 and is considered realistic. Of the 67 potential 43 million t of chromite products, approxi- mately one-third is classified as high grade (>40 pet CrjOs) and two-thirds as low grade (<40 pet CrA). India's production of chromite products has de- creased since the mid-1970's and, although ostensibly attributed to reduced demand, this is mostly due to the imposition of controls by the Indian government on the domestic chromite industry as part of its con- servation policy. These controls include (1) banning the export of certain lump ores (40-42 -f- pet CrsO:, with low SiOa values) and fines ore (>47 pet CrsO,,) ; (2) export taxes on all other chromite products that are exported; and (3) export tonnage quotas imposed on all individual companies producing chromite prod- ucts for export. It is interesting to note that since 1975 there has been an almost 1:1 correlation between declining annual production and declining annual ex- ports of chromite products. As of 1979, total country export quotas stood at 57,000 t of lump ore, 50,000 t of low-grade fines, and 10,000 t of concentrates. On a per-ton-of-product basis, nationwide mining costs average $41/t of chromite; beneficiation averages $4.50/t, and transportation $17.50/t of product, for a total production cost, FOB the port of exportation, of $63/t. Total (FOB) production costs for the high- grade material currently being produced in the Cut- tack and Keonjhar districts average $41/t and $58/t, respectively, and is even more competitive in light of the fact that it competes directly with Turkish, Iranian, and Soviet high-grade resources which are either more costly by this report's criteria or unavail- able as long term supply sources. It is thus clear that India, overall, possesses cost-competitive chromite ore and concentrate products. The major issues and con- straining factors surrounding the availability of chro- mite from India are not related to resources, tech- nology, or production costs, but rather to government- al policy concerning the conservation of high-grade resources, the further development of a major domestic ferrochromium industry, and transportation-infra- structural problems. Transportation (fig. 30) of chromite from the Keonjhar District is usually accomplished by trucking the ore and concentrate about 55 km southeast to the Bhadrack railhead on the Cuttaek-Calcutta railroad line. From Bhadrack it is about 100 km by rail to the city of Cuttack and 300 km by rail to Calcutta. If chromite products are to be exported via Paradip port to the southeast of Cuttack, it is probably more effi- cient to truck the chromite all the way from Bhadrack to Paradip, a distance of about 150 km, giving a total trucking distance of about 200 km from the Keonjhar mines. A 1979 proposal to construct an 80-km rail line from Cuttack to Paradip would allow shipments from Bhadrack to be railed to Paradip, but the status of this spur is not known at present. Chromite from the Cuttack District mines bound for export through Paradip port have to be trucked any- where from 150 to 170 km, mostly by an express high- 500 1,000 ^ToCoimbotor* /v/ Scal.,l«m INDIAN OCEAN LEGEND O City and /or port ^ Chromite district or mine b Ferrochromium smelter (existing) D, Ferrochromium smelter (proposed) ■ Road or highwoy H — 1 — 1- - Railroad Figure 30. — Location of selected chromite mines and mining districts, current and proposed ferrochromium smelters, transportation network, and ports of exportation In India. way. If bound for Calcutta, the chromite would prob- ably be trucked 60 to 70 km to the city of Cuttack and railed an additional 400 l^m. The Hassan District of Karnataka State in western India currently utilizes the port facilities at Manga- lore for transshipment. This port is approximately 225 km from the producing mine at Byrapur and would service the operations planned for the nearby Jambur- Tagadur area as well. Transport is via truck for about 25 km to the Tiptur railhead for transshipment 200 km by rail to the port. Within India there are no major distance or cost disadvantages to overcome, but the capacity of the railroads is severely strained. It has been estimated {53, p. 68) that 80 pet of all rail traffic in India carries coal, which is in great demand given the shortage of domestic oil production. Chromite must then compete for the remaining space against other, higher valued commodities. In addition, India's rail system is not computerized nor electrified. The Indian government has asked the World Bank for a $700 million loan to accomplish this, but the Bank has questioned the old freight rate policies that equalize costs across the sub- continent and is further concerned about the employ- ment effects upon those industries, such as coal, which can employ up to 70,000 women in a single manual coal-rail-loading operation {53, p. 68) . In addition, the government of India, in 1979, signed an agreement with the Soviet Union to supply them with 3 million tpy of iron ore from the mines in Orissa State. Since this material is to be exported through Paradip port on a preferred basis, and since Paradip is the major chromite-exporting point, it is anticipated that chromite shipments from India will be adversely affected. There is another major ore and bulk cargo handling facility at Visakhapatnam, which lies approximately 400 km south of Cuttack. It is accessible by highway and rail and can handle ships up to 100,000 DWT. The primary mineral commodities handled, however, are iron ore, coal, and alumina. Also, the additional cost of rail transport to this port could range from $20 /t to $25/t of product, and rail capacity availability is uncertain. The potential ex- pansion of the chromium industry in India, particular- ly as it concerns international trade, therefore de- pends not only upon the upgrading of the trans- portation infrastructure but upon the status of other developmental and trading issues as well. To summarize, India has recently proven very large tonnages of chromite-bearing material, the great ma- jority of which is low-grade material in Orissa State. Historically, India has been a major supplier of chromite products to Japan, which usually purchases most available supply. India's high-grade resources, which compete directly with other high-grade produc- ers such as Turkey and the Philippines and represent about one-third of potential chromite product avail- ability, have been banned from export. The volume of potential exports is further constrained by transporta- tion and portage problems, export quotas, and increas- ing domestic demand for chromite products for local ferrochromium production. The relative proximity of India to Japan, its historic chromite trading patterns, and the announced plans to further develop a domestic ferrochromium industry all mitigate against India becoming a major supplier of chromite material to the United States. HIGH-CARBON FERROCHROMIUM AVAILABILITY At present (1981) there are only two small produc- ers of ferrochromium in India (fig. 30), the FACOR plant at Shreeram Bawar in Maharastra State and the Orissa State Industrial Development Corp's Jaipur Road smelter in the city of Cuttack, Orissa State. FACOR's plant has a design capacity to produce 10,000 tpy of low-C ferrochromium, 5,000 tpy of high- C ferrochromium, and 4,000 tpy of ferrosilicon chro- mium. The Jaipur Road plant has a capacity to produce 10,000 tpy of high- and low-C ferrochromium and 700 tpy of ferrosilicon chromium. Both plants were com- missioned in 1969. Total country production of ferrochromium products has varied from 17,000 to 21,500 tpy during the mid to late 1970's. At this production rate it is estimated that about 50,000 to 60,000 tpy of chromite ore and concentrate would be consumed in ferrochromium production, roughly about 15 pet of India's total annual production during that period. However, plans have been proposed and, in some cases approved, to construct at least four additional ferrochromium smel- ters in the country : • A 50,000-tpy high-C ferrochromium smelter to be built by Orissa Mining Corp. in Orissa State with assistance by Outokumpu Oy of Finland and Voest Alpine of Austria. • A 50,000-tpy high-C ferrochromium smelter to be built by FACOR based on their own technology derived from the Garividi (Shreeram Bawar) plant in Maharastra State. • A 50,000-tpy high-C ferrochromium smelter to be constructed by Indian Metals and Ferroalloy's Ltd., also to be built in Orissa State with assist- ance by Elkem of Norway. • A 6,000-tpy ferrochromium smelter to be built at Byrapur in Karnataka State by Mysore Minerals Ltd., with Japanese assistance. If all of this ferrochromium smelting capacity (156,000 tpy) were to be built, it would consume an additional 350,000 tpy of chromite, bringing total in- ternal consumption for metallurgical use to about 400,000 tpy. This means that, provided the country can maintain production of around 540,000 tpy of chromite ore and concentrate (the estimated maximum produc- tion capacity as of 1981), fully 75 pet would be con- sumed to feed the ferrochromium plants already plan- ned. This would leave 25 pet (—140,000 t) of (prob- ably low-grade) chromite product for export. This, of course, is a maximum potential scenario. Because of the developmental direction indicated by these plans, it was decided to analyze all of the Indian chromite "units" as if, by 1985, all output were being smelted to high-C ferrochromium in-country. It was decided to apply this scenario to all "units" in order to ascertain total potential availability of high-C ferro- chromium from the demonstrated resources that have been established, and, because of the impossibility of ascertaining what proportion of output from each of the six mining "units" should go to the planned smel- ters, what proportion would go to domestic chemical market uses, and what proportion would be exported. It is also impossible at this time to know for sure which, if any, of the proposed smelters will actually be built. As a result of this decision, all six mining units were burdened, proportionally, with estimated capital costs for ferrochromium production facilities incorporating all announced plans. In addition, the mining units in the Keonjhar and Cuttack districts were burdened with approximately $53 million (1981 dollars) in infrastructure capital investments asso- ciated with constructing the ferrochromium facilities. To utilize total chromite product capacity of 540,000 tpy for the domestic manufacture of high-C ferro- chromium would require a total smelting capacity of around 222,000 t, for a total capital plant investment of about $295 million. The majority of this cost is pro- rated to the low-grade material, since the planned smelters would utilize this resource the most. The total potential availability of high-C ferro- chromium determined as a result of this analysis is 18.3 million t of grade-B ferrochromium (56 to 64 pet contained Cr) or approximately 82 yr of potential full capacity production. The long-run average total cost of production at the breakeven level ranges from $0.21/lb to $0.25/lb ferrochromium, with a weighted- average of $0.23/lb, or about $0.40/lb of contained Cr. In order to attain a 15-pct long-run profitability level, sales prices of $0.33/lb to $0.46 /lb ferrochromium with a weighted-average of $0.38/ib, or $0.64/Ib of con- tained Cr would be required. These latter cost esti- mates are markedly higher because of the large capital investments, which require higher necessary sales prices in order to recover the total investment and attain this 15-pct rate of return. It would seem that India, which currently is a net importer of ferrochromium, could economically satisfy its domestic demand by the further expansion of its smelting capacity. The competitiveness of its ferro- chromium in the international market would be in question, however, given the overall predominance of South Africa, especially in terms of grade-B and grade-C ferrochromium products and the competitive- ness of the higher grade ferrochromium producers, such as Turkey, which have a distinct comparative advantage given that their industry is well established. Also, since the major market for Indian chromite products has been Japan it is uncertain if that market would become available for the sale of ferrochromium as opposed to chromite raw material. It is uncertain, at this time, whether all of the proposed ferro- chromium smelters will actually be built in the near future. Lastly, the aforementioned constraints con- cerning the expansion of chromite ore and concentrate production and export hold here as well. SUMMARY • Indian chromite resources at the demonstrated level are estimated to be 81.2 million t with a weighted average grade of 32 pet CrgOa, 97 pet of which is contained within Orissa State. • This cost-evaluated resource is estimated to con- tain a potential 43 million t of chromite products. • Total potential grade-B high-C ferrochromium availability is estimated at 18.3 million t. • Chromite production costs (as defined) are esti- mated at $63 FOB the port of exportation, appor- tioned $41/t of product for mining, $4.50/t of product for milling , and $17.50/t of product for transportation. • Domestic Indian high-C ferrochromium produc- tion costs (as defined) are estimated at $0.40/lb of contained Cr for the break-even level, and $0.64/lb of contained Cr for the 15-pct profit- ability level. • Major implications are that chromite export con- trols and increased domestic production of high- C ferrochromium in the future will reduce chro- mite products available for export. This represents a continuation of the trend toward ferrochromium production in those countries that mine chromite. • Since the above analysis of high-C ferrochromium availability was completed, two of the four pro- posed smelters have been constructed, the 50,000- tpy smelter of Orissa Mining Corp. in Orissa State and the 50,000-tpy smelter of FACOR, also in Orissa State, both of which initiated production in 1983. These developments further underscore the trend toward increased Indian high-C ferro- chromium production and export. BRAZIL GEOLOLGY AND RESOURCES Brazilian chromite resources at the identified level (measured plus indicated plus inferred) were officially set by the Departmento Nacional do Producao do Minerales (DNPM) in 1977 at approximately 24 million t of ore. Of this, 57 pet was in the Campo Formoso District, 2 pet in the Jacurici River Valley deposits, 4 pet in the Alvarado do Minas area, and 37 pet among about 100 "other" small occurrences nationwide (54, p. 24). (See figure 31 for locational details.) This study estimates total Brazilian chromite re- sources (table 42) for the in situ demonstrated level, at approximately 18.6 million t, and identified re- sources at about 39 million t. With a weighted-average demonstrated resource grade of 21 pet, it is estimated that a total of 3.9 million t of CrgOg is contained with- in this resource. 70 LEGEND City or town Mine or deposit Ferrochromium smelter Railroad Road or highway Figure 31. — Location of selected chromite mining operations, transportation network, ferrochromium smelter, and attendant port facility In Brazil. Table 42. — Estimated In situ chromite resource data for selected Brazilian deposits and operations, as of 1980 non,«n».r,.«H ^f,=,»!!f' Contained Identified pet CrjOj Pedrlnhas (Cannpo FornDOSO) 13,000 21.0 2,730 1 „.„„ Limoeira (Campo f ^^'^^ Fomnoso) 4,000 17.0 680 "* Jacurici Valley' 1,110 37.4 415 1,180 Alvorado do Minas' 525 26^5 139 850 Total or average... 18,63S ^21.0 3,964 39,030 ^ Data may not add to totals shown t>ecause of averaging and Independent rounding. * Identified tonnage equals demonstrated plus inferred tonnage. ' Not cost evaluated for reasons explained in text. * Country grade is the in situ weighted average over all deposits at the demonstrated level. For this study, a complete engineering and economic evaluation was performed for the extraction of the estimated 17 million t of demonstrated chromite in- cluded in the Campo Formoso District. This area cur- rently produces 87 pet of Brazil's chromite products. The resource is considered to be minable by open pit methods to a vertical depth of 50 m for the entire 14- km trend of the Campo Formoso District. The assump- tion is made that individual pits will be developed all along the strike and that no pit will go to underground mining until the entire strike length has been mined by surface pitting to a 50-m vertical depth. The deposits of the Jacurici River Valley and Alvarado do Minas areas, as well as the 100 or so other occurrences in the country, were not subjected to complete cost evaluation. There are three major reasons for this. First and most important, the level of individual deposit data at this point in time is too scant to meaningfully address the economic determi- nants. Second, reported production from the small individual mines and deposits is too variable to make a meaningful projection of capacity, mining methods, and the attendant costs. Third, the relative importance of these areas to an overall study of Brazil's chromium industry as it presently exists is virtually nonexistent. There is obvious potential for further expansion with- in these areas, but much more geologic knowledge must be obtained and larger ore bodies found for these areas to provide a significant contribution to the Brazilian chromite industry. The total resource available from underground min- ing in the Campo Formoso District could be on the order of 20 million t of 44 pet Cr,0<„ giving it sub- stantial potential. However, many questions regarding methodology of extraction remain to be answered be- 71 fore the economic potential of this resource can be determined. The chromite resources in the Campo Formoso area from the Pedrinhas and Limoeira operations are classi- fied as stratiform deposits. The chromite layers have been categorized into two basic ore types: (1) serpen- tinite containing more than 75 pet chromitite is considered as "high-grade" ore, and (2) serpentinite with 20 to 75 pet chromitite is considered as "low- grade" ore. Generally, the low-grade ores are economic- ally mined only where weathering has been intense enough to yield friable ore. Assuming that there is about 90 pet chromite in the chromitite and 50 pet CrjO., in chromite, then the low-grade ore would range from 10 to 35 pet CrjO, and the high-grade ore from 35 to a theoretical 50 pet (where 100 pet of the chromitite is chromite) . Because the mechanized open pit operations presently producing cannot practice selective mining of the individual high-chromitite- grade layers, the overall grade of material fed to the mill runs about 21 pet CrgO^ from the Pedrinhas operation and 17 pet from the Limoeira operation, with Cr:Fe ratios ranging between 1.8 and 3.0. MINING AND BENEFICIATION The Campo Formoso District consists of three well- defined trends — Pedrinhas, Limoeiro, and Cascabulhos. The Pedrinhas and Cascabulhos trends have been com- bined into one operation which includes all the open pit operations of FERBASA, as well as the Coitzeiros open pits of COMISA, a subsidiary of the Bayer group of West Germany. The Limoeira trend was evaluated separately. Pedrinhas Operation Production from the Pedrinhas and Cascabulhos trends began in the 1960's. Until 1970, production did not exceed 40,000 tpy of crude ore. Major increases in capacity brought crude-ore production up to approxi- mately 250,000 tpy by 1972. As of 1980, capacity of the several open pit operations in the Pedrinhas and Cascabulhos trends was estimated to be 400,000 tpy of crude ore, and was the rate applied throughout the remaining life of the operation. The weighted-average stripping ratio over the life of this demonstrated resource tonnage is estimated to be 5.7. Thus, from 1980 through the remaining life, it is estimated that on average about 2,268,000 tpy of waste and 400,000 tpy of ore will have to be moved in order to produce 120,000 tpy of chromite products. The mining plan incorporated the assumed necessity to drill and blast all material other than the colluvial overburden which can be simply dozed. No preproduc- tion stripping is required and clearing requirements are minimal. Operations were modeled on a two-shift- per-day, 300-d/yr basis. For this surface mining operation, the mining operating cost/t of crude ore is composed of 15 pet labor, 8.5 pet materials and sup- plies, and 76.5 pet equipment operation. Exploration and acquisition costs are relatively insignificant. For this study, it has been estimated that about 10 pet of the resource for the combined Pedrinhas and Cascabulhos trends (to a vertical depth of 50 m) is lump ore with an average Cr:Fe ratio of about 2.0 to 2.5; the remaining 90 pet is friable ore with lower grades and lower Cr:Fe ratios which must be concen- trated by gravity and magnetic separation to produce a 45-pct-Cr203 concentrate with a Cr:Fe ratio of 1.8. There are two processing mills for this resource, a 1,000-tpd mill owned by FERBASA and a smaller 333-tpd mill owned by COMISA. The FERBASA processing mill was constructed prior to 1965 and has been constantly expanded to its present capacity. The overall grade of crude ore feed to this mill averages a relatively low 21 pet CraOg, owing to dilution from barren rock and low-grade serpentinite-chromitite ore interspersed among the higher grade chromitite layers. This results from the necessity to practice non- selective mining of the resource. Mill recoveries for lump ores and grains, estimated to constitute 25 pet of salable product, are effectively 100 pet. Recovery of CraO.T in the concentrates, which represent about 75 pet of salable product, is estimated to be very low at 62.5 pet, based on reported results. Specific reasons for this low recovery are not definitely known but most likely are due to the intimate nature of occurrence of chromite with silicate and ferruginous gangue miner- als. The COMISA mill produces on the order of 20,000 to 30,000 tpy of high-iron chromite concentrates, of which about two-thirds is sold to the domestic chemical industry and the remainder to FERBASA for use in the domestic manufacture of ferrochromium. The only apparent difference in the operating method from that of the FERBASA mill is the lack of some hand sort- ing of lump ore. Limoeira Operation In 1972, a joint venture was set up by FERBASA, which owned the mining concessions for the area east of the Limoeira fault, and several Japanese companies. The joint venture company, SERJANA, conducted a major exploration effort from May 1972 to late 1974, spending approximately $2 million. Mine development began in 1975, and the first products were shipped in December of 1976. The operation ran into grade and pit slope problems almost immediately. The overall grade encountered was much lower than expected be- cause selective mining was not possible. The stripping ratio, although initially estimated at 3, was running at 5 only 2 yr after startup. In addition, it is estimated that to mine out all the resource to a 50-m vertical depth, the stripping ratio over the life of the operation will run about 11, or 3,410,000 tpy of waste to 310,000 tpy of crude ore. In 1980, the Japanese members of the joint venture sold their interest to FERBASA. The mining plan requires drilling and blasting all material other than the colluvial overburden, which ranges from 5 to 15 m thick and can be dozed. Opera- tions are assumed to be conducted on a two-shift-per- day, 300-d/yr basis. Little or no preproduction strip- ping is required, and clearing is minimal. Mine operat- 72 ing costs per ton of crude ore are composed of 17 pet labor, 9 pet materials and supplies, and 74 pet equip- ment operation. Mining costs at Limoeiro, primarily as a result of the higher overall stripping ratio, should average 62 pet more than Pedrinhas over the mine life. The Limoeira mill was constructed in 1975-76. Its estimated capacity of about 1,033 tpd of crude ore throughout is based upon production figures, con- sideration of the resource position, and the increased stripping ratio encountered in the mine. It is assumed that 17 pet of salable product will be in the form of lump ore and grains and 83 pet will be in the form of concentrates. As the Limoeira mill does not employ magnetic separation, this results in a lower Cr:Fe ratio in the concentrates (■—1.5) and the CrjO, re- covery overall is slightly lower than at Pedrinhas. Mill operating costs for the major mills at Limoeira and Pedrinhas are not significantly different. Both costs are composed of approximately 20 pet labor, 43 pet materials and supplies, and 37 pet equipment operation Underground Mining Potential There is potential for underground mining at both the Pedrinhas and Limoeira operations in the Campo Formoso District. However, serious planning of under- ground mining will probably not have to be considered for at least 10 yr at Limoeira and 25 yr at Pedrinhas, since the estimated open pit resources at capacity production will last 12 and 32 yr, respectively. A rough estimate of the operating cost of underground mining at Campo Formoso, based on adopting methods similar to the breast stoping mining method in use in South Africa, would probably be $35/t to $40/t of ore (including development costs and excluding mine equipment and mine plant capital costs). However, underground methods such as breast stoping, although labor intensive, do allow for very selective mining and would probably reduce the concentration ratio from the 3.5 experienced in present open pit mining opera- tions, to the 1.5 or less typical of most underground chromite operations around the world. Thus, at an underground mining cost of $40/t of crude ore, the cost per ton of product would be about $60/t, which is similar to an open pit operation with a stripping ratio of 9 and a concentration ratio of 3.5. The Jacurici River Valley deposits could also be attractive for underground mining since little or no beneficiation is required and the concentration ratio is low. However, the small size of deposits in the Jacurici Valley may not justify the high initial development costs of a comparatively large underground mine. CHROMITE AVAILABILITY The two operations herein evaluated have the poten- tial of producing approximately 4.6 million t of chro- mite products. Of this total, 82 pet is contained within the Pedrinhas and Cascabulhos trends of the Pedrin- has operation and 18 pet is contained within the Limoeira operation. If operated at full capacity, pro- duction would continue for 32 yr at Pedrinhas and 12 yr at Limoeira. Combined output would approximate 190,000 tpy of chromite products with a weighted- average grade of 44 pet CrgOg. Transportation distances from the major producing area of Campo Formoso in Brazil average approximate- ly 375 km to the ferrochromium smelter at Pojuca and about 450 km to the port of Salvador in Bahia State. The chromite is trucked from the mine site 30 to 40 km to the railhead and transported by rail the remain- ing distance. Transportation costs for the two opera- tions are essentially equal and average in the inter- mediate range relative to the other countries studied. Transportation should not pose an economic deterrent to the expansion of chromite exports. There are significant economic differences, however, between the two operations studied. Because of the higher stripping ratio and lower in situ grade, the mine and mill operating costs per ton of chromite product at the Limoeira operation average 2.1 and 1.4 times greater, respectively, than at the Pedrinhas operation. In addition, the concentration ratio averages around 3.3 at Pedrinhas and 4.4 at Limoeira, again giving an economic advantage to Pedrinhas material. On a country average this works out to be about 3.5 t of material mined per ton of ore and concentrate produced. The total cost over the life of the demonstrated resources to mine, process, and deliver chromite (FOB) the port of Salvador is estimated to be $96/t and $164/t for Pedrinhas and Limoeira, respectively. Thus, for Brazil, the overall costs to mine, process, and transport chromite, on a weighted-average country basis, are $65.50/t, $11.50/t, and $31.50/t, respective- ly, for a total of $108.50/t; relative to other world producers herein evaluated, Brazil is the second most expensive. It must be emphasized that these long-run costs were determined based upon extracting all sur- face minable material to a vertical depth of 50 m over the entire 14-km trend of the Campo Formoso District and take into consideration such factors as increasing stripping ratios and declining average grades. Current production costs are, of course, lower. HIGH-CARBON FERROCHROMIUM AVAILABILITY Ferrochromium has been produced in Brazil since 1966. Reported production of high- and low-C ferro- chromium and ferrosilicon chromium has increased in line with capacity expansions, rising from approxi- mately 3,000 t in 1966 (5^, p. 26) to 102,000 t in 1980 (55, p. 3). Since 1974, production of high-C ferro- chromium as a percentage of total production has averaged 85 pet. There is one ferrochromium smelter in the country, owned by FERBASA, located at Pojuca, about 75 km north of the Port of Salvador. Rated capacity as of 1980 for the seven furnaces at Pojuca was approxi- mately 90,000 tpy. The products produced are: grade- B, high-C ferrochromium, low-C ferrochromium (68 pet contained Cr), as well as ferrosilicon chromium. If the facility were to operate at this rated capacity, producing only high-C ferrochromium, it would need 73 the entire output of chromite ore and concentrate production from the Pedrinhas and Limoeira opera- tions, as evaluated in this study, as well as the pro- duction from the Jacurici River Valley deposits. How- ever, this would leave no chromite available for export. Present mining and milling capacity is sufficient only for in-country ferrochromium smelting, which is indicated by the fact that the only chromite exported from Brazil during 1975-80 came from the SERJANA- operated Limoeira mine and was sent to Japan. With the sale of the Japanese interest to FERBASA, all production from Limoeira can now be sent to the Pojuca smelter. It is indicated that to further increase the capacity of the Pujuca smelter would require either increasing capacity at the present mines, im- proving the grade of ore mined by selective mining techniques, or opening up new mines by proving up reserves at the many "other" occurrences throughout the country. It has been estimated that domestic demand for ferrochromium in Brazil should rise to a total of 110,000 t by 1987 (5^, p. 31). This 20,000-t increase in smelting capacity would require approximately 50,000 tpy of lump ore and concentrate feed, which in turn would require approximately 175,000 tpy of addi- tional crude ore production if the chromite products from the present operations in the Campo Formoso District were used. Such an increase would not be difficult to attain given the present producers' installed capacity. However, the country would be hard pressed to produce additional chromite for export unless new mines were opened. It is estimated here that approximately 1.9 million t of grade-B ferrochromium could be produced from the demonstrated resources contained within the two operations studied if the Pojuca smelter were devoted entirely to the production of high-C ferrochromium. The Pedrinhas operation would account for 54 pet of total smelter output and 82 pet of available ferro- chromium from the two evaluated operations com- bined. On an annual basis, production could average 78,000 tpy from the Pedrinhas and Limoeira opera- tions, with the remaining 12,000 tpy being produced from chromite production at the other, smaller mines. Both Pedrinhas and Limoeira appear, on a relative basis, to be cost competitive with other world producers of grade-B, high-C ferrochromium. The price determi- nations at the breakeven level on a country basis would average $0.25/lb ferrochromium or $0.43/lb contained Cr. To obtain a long-term 15-pct rate of return would require a necessary sales price of $0.30/ lb ferrochromium, or $0.52/lb contained Cr. Again, the economic differences between the operations are apparent as Limoeira requires a price between 17 and 29 pet higher, depending upon the rate of return sought, than Pedrinhas. As far as being a potential source of supply of chromite and ferrochromium to the United States, Brazil appears to have, at this point in time, only limited potential. However, it bears repeating that this study analyzed only the demonstrated resources from the Campo Formoso District that are minable by open pit methods. There is a substantial under- ground resource that may be exploitable in the future and there is also potential for the future proving up of resources elsewhere in the country. These future developments hinge on two major fac- tors. The lirst and most important is the cost com- petitiveness of Brazil in the world market for chro- mite and ferrochromium, and the second is the de- velopmental objectives and priorities of the Brazilian government. It would appear that Brazil can adequate- ly meet its future domestic demand for ferrochromium but would not have major tonnages available for ex- port. It must be remembered that Brazil's contribution to the world ferrochromium industry is dependent not only upon the state of the world steel industry, but the growth and competitive position of the domestic Brazilian steel industry as well. SUMMARY • A total in situ demonstrated resource of 17 mil- lion t was cost evaluated. • This demonstrated resource is estimated to con- tain a potential 4.6 million t of chromite products with an average grade of 44 pet CrjOg. • Total grade-B, high-C ferrochromium potentially available from this demonstrated resource is esti- mated at 1.9 million t. • Chromite production costs (as defined) are esti- mated at $65.50/t for mining, $11.50/t for mill- ing, and $31.50/t for transportation, which re- sults in a long-run cost estimate, FOB the port of Salvador, of $108.50 /t of product. • Ferrochromium production costs (as defined) are estimated at $0.43/lb of contained Cr for the breakeven level and $0.52/lb of contained Cr at the 15-pct profitability level. • Major implications are that Brazil should be able to meet its projected domestic ferrochromium con- sumption needs and continue to export relatively small quantities of ferrochromium products, but does not hold much promise as a major available source of imported chromite for the United States at this time. 74 FINLAND GEOLOGY AND RESOURCES The Kemi chromite deposits are located at Elijarvi, about 7 km northeast of the town of Kemi on the north- ern end of the Gulf of Bothnia (fig. 32) . The chromite ores are associated with a basic-ultrabasic, sill-like intrusion at the contact between the Pudasjarvi mig- matite-granite massif and the Karelian schist area of Perapohja (56). The sill-like intrusion reaches a maximum width of 1,500 m with outcrops beginning at the town of Kemi and extending for 15 km to the northeast. In the vicinity of the present mining opera- tions, the chromite horizon occurs 50 to 200 m from the bottom contact of the sill and basically parallels the northeast strike of the contact. The intrusive host has a dip of 70° to the northeast. The ore bodies are strongly brecciated and thus con- tain many inclusions of altered wall-rock gangue such as talc, magnesite, dolomite, and serpentinite. The ores can be classified into two types ; a soft talcose ore and a hard serpentinite ore, with the former account- ing for 85 pet and the latter 15 pet of the total. The grade of the ore is fairly low, averaging about 27 pet C2O3 with a Cr:Fe ratio of about 1.5 reflecting di- lution with gangue material. Of the total 15-km length of the intrusive formation, economic ore bodies occur only in a 5-km length located north and northeast of the town of Elijarvi. As of the mid-1970's, eight ore bodies were known to occur over this 5-km length. The ore bodies are named (from southwest to northeast, see figure 32), Mati- lainen, Surmanoja, Nuottijarvi, Elijarvi, Viiaanranta, Viianlahti, Viianmaa, and Perukka. The first open pit mining began in 1967 at the Elijarvi ore body and continued through 1977, when a new pit (Viaa) was brought into production to mine the Viiaanranta and Viianlahti ore bodies. At the start of operations in 1967 it was estimated that the Elijarvi ore body contained a total of 14.5 million t of ore, 5.7 million t of which could be mined by open pit methods. It is estimated that prior to closing in 1977 about 5.5 million t of ore had been extracted from the Elijarvi ore body by open pit methods. The relatively new Viaa pit is estimated to contain 6.3 million t of resource amenable to open pit mining to a depth of 110 m at a stripping ratio of 2.7. Based upon a comparison of ore body dimensions within the Viaa pit to the dimensions of the other available ore bodies, and assuming that there is a correlation between ore body dimensions and available material suitable for open pit mining, then the total demonstrated resource as of 1979 for surface mining of all the ore bodies lies in a range from 25 to 30 mil- lion t. This study assumes that the maximum amount of demonstrated resource, less 1979 production, is available (29.2 million t) at an overall stripping ratio of 3 t of waste per ton of ore. There is potential for 1 / ^Perukka <:w _^X -N- Kemi mine /viianlaMa — C Viianlahti^ J X ->..^ ''/Ivilanranta I /( Matilalne^^ (/^^\^ \ rf X 0. /^A" Scale, km LEGEND City fn} Mine Ferrochromium smelter I N L ih Mine facilities S V •^^ ~^ '^ -Ore body ^ 100 200 300 Scale, km Figure 32. — Location of Kemi chromite mine, transportation network, smelting, and In Finland. 75 the future exploitation of underground chromite re- sources at Kemi, although this is a very long-term is- sue given that the demonstrated resources available for open pit mining could last up to 40 yr. A pre- liminary estimate of this resource is that it may be on the order of 30 million t; however, numerous tech- nical issues, such as the weakness of the ore and wall- rock material, must be further studied before any economic evaluation can be made. MINING AND BENEFICIATION The Kemi mine employs open pit mining methods for the exploitation of its low-grade ore. The open pit is constructed with low bench heights, which allow for selective mining of the widely varying ore bodies. The mining development plan derived for the engineer- ing cost evaluation of the Kemi mine includes the cost of mining all eight ore bodies sequentially over the mine life with open pit methods. Stripping ratios over all remaining ore bodies are assumed to average around 3. Total mine recovery of all chromite ore should effectively be 100 pet, including dilution. The mine operating cost that was estimated for the mine life includes the necessity to truck ore from the mine site to the mill an average of 3 km over the life of all ore bodies, and also includes all preproduction develop- ment costs. Current mine operating costs per ton of ore are relatively low and are not expected to increase significantly in the future as a result of technical or geologic problems. As the ore is mined, it is separated into lump ore for direct shipping and into feed for the on-site mill. Principal mill phases are crushing, grinding, and wet and dry magnetic separation to produce either a con- centrate for feed to the Tornio ferrochromium smelter or direct sale, or a concentrate for use as raw material for further processing to chromite foundry sand. Overall mill recovery for all products averages 85 pet. However, the weighted-average grade of all products is a very low 31 pet CrgO, reflecting the large amount of production that is sold as direct shipping ore. CHROMITE AVAILABILITY The Kemi mine is one of the least expensive major producing chromite operations in the world. This property has a potential of producing approximately 17 million t of 31 pet CraO,, high-iron chromite over the next 36 yr. Operating at a mine capacity of 800,000 tpy of ore, with a concentration ratio of 1.6, this would represent about 475,000 tpy of chromite products. In addition, approximately 2.5 million t of foundry-grade concentrate is potentially recoverable, which at capacity production would approach 69,000 tpy. Despite the relatively low grade of the ore and the adverse weather conditions, the government-owned company, Otokumpu Oy, can produce chromite for a combined mining, processing, and transportation cost, FOB the port of Ajos, of only $25/t of product over the life of the mine. There are basically three reasons for this. First, the stripping ratio is relatively low for a surface chromite mine, which reflects the rela- tively steep dip of the ore bodies. Second, since it is possible to practice selective mining, this allows the concentration ratio to remain relatively low. Third, the deposit is advantageously located with respect to infrastructure and port facilities. The Tornio inte- grated steel works has the capacity to consume about 30 pet of the chromite ore and concentrate for the domestic manufacture of high-C ferrochromium. The remaining tonnage is available for export, with the Vargon ferroalloy smelter in Sweden being the closest consumer for metallurgical purposes. The Kemi mine enjoys a clear locational advantage for the sale of its high-iron chromite and foundry sands to the mar- kets of northern Europe, Scandanavia, and the COMECON member states of eastern Europe. Fin- land is not a member of the EEC. The United States, as of the late 1970's, derived between 3 and 4 pet of its chromite imports from Finland. The mining operation at Kemi faces no major trans- portation problems of note. Mine output is trans- ported either to the Finnish ferrochromium smelter at Tornio, at a distance by truck of around 50 km, or to the port of Ajos at the town of Kemi, about 20 km away from the mine site, for transshipment to the Vargon smelter in Sweden or for export to other coun- tries. The Tornio steel facility utilizes the outport facilities at Roytta, which from about mid-December to mid-May is generally frozen over. The facilities at these ports pose no major constraints for the exporta- tion of Kemi chromite and ferrochromium products. HIGH-CARBON FERROCHROMIUM AVAILABILITY The Tornio integrated steel works is a state-owned enterprise operated by Otokumpu Oy. It includes a ferrochromium smelter, constructed in 1968 and sub- sequently expanded, with a current rated capacity of 50,000 tpy. The smelting process incorporates pelletiz- ing with a sintered-pellet capacity of 120,000 tpy. Al- though Otokumpu Oy maintains the stated objective of doubling its steelmaking capacity at Tornio, which would necessitate a concomitant expansion of the fer- rochromium plant, this goal is a long-term one with no fixed timetable. For this reason no capacity ex- pansion beyond the current 50,000 tpy was incorpor- ated into this analysis. At current rated capacity, the Tornio smelter would utilize about 30 pet of the annual chromite production from Kemi given an 800,000 tpy of crude ore mine output. For purposes of establishing the cost and quantity of ferrochromium potentially available from the demonstrated resource at Kemi, the remaining chromite output above the capacity limit at Tornio was transported to the Vargon ferroalloy smelter in Sweden. All smelter operating and transportation costs were put on a weighted-average basis to account for this. The cost determination of $0.31/lb contained Cr that was derived on this basis, therefore, represents 76 the average breakeven long-run cost of high-C fer- rochromium, FOB the Vargon and Tornio smelters. Since this very low cost determination still represents a correspondingly higher cost than if 100 pet of Kemi's output was utilized at the Tornio smelter, it further underscores the basic long-run competitiveness of this resource. The total quantity of grade-C charge ferrochromi- um that is potentially recoverable from the demon- strated resource at Kemi is approximately 5.4 million t. On an annual-capacity basis, this represents a potential product flow of 800,000 tpy of mine output yielding a high-iron chromite mill output of 475,000 tpy, which in turn yields an average 150,000 tpy of high-C ferrochromium over a total period of 36 yr. Given that internal consumption at capacity operation of the Tornio smelter would utilize roughly one-third of the potential chromite resource at Kemi, Finland should remain an available supplier of chromite and ferrochromium for the remainder of this century. SUMMARY • A total in situ demonstrated resource of 29.2 mil- lion t was cost evaluated. • This demonstrated resource is estimated to con- tain a potential 17.1 million t of high-Fe chromite products at an average grade of 31 pet CrgOs for further processing to high-C ferrochromium. • Total grade-C, high-C ferrochromium potentially available from this demonstrated resource is estimated at 5.3 million t. • Chromite production costs (as defined) are esti- mated at $9.50/t for mining, $6.50/t for milling, and $9.00/t for transportation, which results in a long-run cost FOB the port of Ajos of $25/t. • High-C ferrochromium production costs (as de- fined) are estimated for the breakeven level at $0.31/lb contained Cr. • Major implications are that Finland should re- main a major exporter of both chromite and ferro- chromium for the rest of this century. NEW CALEDONIA GEOLOGY AND RESOURCES Late in 1980, INCO Metals Inc. announced plans to bring an 85,000 tpy chromite mining and processing operation into production at Tiebaghi in New Cale- donia (57, p. 100) . The deposit to be mined is reported- ly located beneath the former open pit operations which ceased production in the early 1960's after producing around 2 to 2.5 million t of ore since the early 1900's. At these deposits, initial underground mining opera- tions were started in the early 1960's, after closure of the open pits, but ceased in 1962 owing to poor eco- nomics. Past literature does not contain much detailed geologic information on the Tiebaghi chromite de- posits and INCO has not released geologic details on the "new" deposit. For these reasons, an estimate of available chromite resources at Tiebaghi, as well as deposit characteristics for complete costing purposes, are only approximated at this time. The Tiebaghi chromite district is located near the northwest tip of New Caledonia, about 7 km north of the village of Pagoumene (fig. 33). The Tiebaghi serpentine dome has a length of about 19 km, extend- ing in a northwesterly direction from the village of Koumac to Nehoue Bay. The dome's width is about 5 km. The old Tiebaghi mining operations were located at the dome's point of maximum elevation of 580 m (58, p. 616). The dome consists mainly of peridotite, dunite, pyroxene, and Harzburgite-olivine rocks. The major chromite ore bodies occur in the central portion of the dome at the northeastern edge of a plateau. Since it is not known with certainty which ore bodies INCO intends to mine in the Tiebaghi area, the exact dimensions and configuration are speculative. Blanchard (58) , in a description from the early 1940'8, describes the mining operations at Tiebaghi as being concentrated on two "pipes"; the Tiebaghi and the Fantoche pipes. He states that the Tiebaghi pipe occupied an area of 30 by 60 m and was proven to a depth of 400 m. No areal extent for the Fantoche pipe was given, but it was mentioned that it had also been proven to approximately the same depth as the Tie- baghi pipe. As of late 1979, official reserves for Tiebaghi, as reported by the Service des Mines et de la Geologie, were placed at less than 1 million t at an average grade of 55 pet CrA and a Cr:Fe ratio of 3 to 3.6 (59). However, standard leasing practice by the government of New Caledonia specifies that a mining lease will not be granted by the government to any operation with less than a 20-yr resource life. Based on this law, it is estimated that the proposed INCO operation must have at least 2.3 million t of in situ resource. This estimate was calculated based on a published (60, p. 39) projected run-of-mine ore capacity of 110,000 tpy and assumes a mining recovery of 95 pet. Back-cal- culation from these published run-of-mine and product capacities indicates that the high-grade ore should average around 44 pet CrgOj with a Cr:Fe ratio of 3. These data were employed in the engineering and economic analysis. Comparison with the published dimensions of the pipelike ore bodies mined previously in the Tiebaghi area indicates that this 2.3 million t could be considered as conservative. If the material planned to be mined by INCO is, in actuality, ore remaining in the Tie- baghi and Fantoche pipes, then there certainly is at least 2 million t remaining since open pit mining was terminated at a depth of 240 m in the Tiebaghi pipe and 100 m in the Fantoche pipe, leaving 160 and 300 m of depth extension, respectively, to be exploited. 77 y^lttm* ' LEGEND O City \V^ X Mine Tiebaghi deposir^ ^^ 1 \ -N- N 1 COffAL SEA ^«^ °-:>- 100 200 Scale, km Figure 33. — Location of Tiebaghi chromlte mine In New Caledonia. MINING AND BENEFICIATION The Tiebaghi mine is evaluated as an underground mining operation, utilizing cut-and-iill stoping, and designed for a 440-tpd production rate with a mine recovery of around 95 pet. Access is via development of new vertical shafts. Mine operating cost per ton of ore is composed of approximately 55 pet labor, 30 pet materials and supplies, and 15 pet equipment opera- tion. Based on announced production plans the mine would operate at full capacity on a 250-d/yr basis. Benefieiation of this ore is proposed to be by crush- ing, screening, and gravity separation to produce 340 tpd of concentrate with an overall mill recovery of 90 pet. Mill operating costs are composed of approximate- ly 50 pet labor, 25 pet materials and supplies, and 25 pet equipment operation. CHROMITE AVAILABILITY In 1982, chromite production began at the Tiebaghi mine with initial mill product output being sold on the spot market {61, p. 49). Full capacity production of 85,000 tpy of salable product is expected to be reached by 1983. This output represents a production life of 20 yr at full capacity operation. At a product grade of 51 pet, it is estimated that 1.7 million t of chromite is potentially available from the 2.3-million-t in situ resource. On a per-ton-of-product basis, the mine operating cost is estimated at approximately $42.50/t, benefieia- tion cost at $7/t, and transportation cost (FOB the port of exportation) at $7/t, for a total cost over the mine life of about $56.50 /t. The transportation cost is based upon trucking the chromite approximately 10 km to a nearby portage for transshipment via barge to an ocean freighter for final shipment, probably to Japan if long term contracting can be arranged. Transport charges to Japan would depend upon market circum- stances and the availability and terms of any con- tracts made with the Japanese. Relative to the internal cost and difficulties of transport faced by other coun- tries, the delivered cost of chromite to Japan from New Caledonia should be quite competitive. HIGH-CARBON FERROCHROMIUM AVAILABILITY There are currently no ferrochromium smelting fa- cilities in New Caledonia, nor are there any current advanced plans for procuring them. In order to ascer- tain the cost of producing grade-A, high-C ferro- chromium from the demonstrated resource of the Tie- baghi operation, the total annual output of chromite was assumed to be transported to Japan for process- ing. All relevant transportation, handling, and smelt- ing costs were incorporated into the economic analysis. The results indicate that approximately 36,000 tpy, or a total of 726,000 t, of grade-A, high-C ferro- chromium could potentially be produced from the Tie- baghi demonstrated resource. The cost determination ranges from $0.25/lb ferrochromium at the breakeven level, to $0.29/lb for a 15-pct rate of return, or $0.38/ lb to $0.44/lb contained Cr. Relative to the cost determinations derived for the same grade ferrochromium product produced in Japan from high-grade Philippine chromite products, the Tiebaghi resource costs $0.08/lb of contained Cr less at a 15-pct profitability level. This indication of relative competitiveness explains the activity underway for the 78 development of New Caledonian chromite resources. It bears mentioning, however, that total ferrochromium availability estimate from the Tiebaghi mine repre- sents only 30 pet of the potential tonnage available from the high-grade resources that have been evalu- ated in the Philippines, which competes with New Caledonia for the Japanese market. SUMMARY • A total in situ demonstrated resource of 2.3 mil- lion t was cost evaluated. • This demonstrated resource is estimated to con- tain a potential 1.7 million t of chromite products with an average grade of 51 pet CrgOj. Total grade A, high-C ferrochromium potentially available from this resource is estimated at 726,000 t. Chromite production costs (as defined) are esti- mated at $42.50/t for mining, $7/t for milling, and $7/t for transportation, which results in a long-run total cost estimate (FOB) of $56.50/t. High-C ferrochromium production costs (as de- fined) are estimated, for the breakeven level, at $6.38/lb of contained Cr on a Japan-market basis. The major implication is that all chromite output should most likely go to Japan as raw material feed for the production of high-C ferrochromium. GREECE GEOLOGY AND RESOURCES As shown in figure 34, there are 12 ultramafic rock complexes in Greece that contain chromite deposits- occurrences. Of these 12 complexes, only four are of large proportions, one of which is the Mount Vourin- hos Complex in north central Greece. In general, refractory-grade chromite is mainly connected with the ophiolites of central Greece where the chromite ore bodies are closely associated with gabbroic rocks (62) . Metallurgical-grade chromite is found in the ophiolite complexes of northern Greece, where they are asso- ciated with dunitic and peridotitic rocks. Almost all of Greece's past production of metallurgi- cal-grade chromite has come from either the Xeroli- vado (Skoumsta) area deposits or the Voidolakkos area deposits, all of which are part of the Mt. Vourin- Ml. Vourinos Complex LEGEND O City ■i Ferrochromium smelter r^ Ophiolite complexes 100 200 \ I Scola.km Figure 34. — Location of ophiolite complexes, Xerollvado chromite mine, and ferrochromium smelter In Greece. 79 has (ophiolite) Complex. Of this past production, the majority has come from the Xerolivado mine (also called the Skoumsta mine) located 2 km west-north- west of the town of Skoumsta. This study evaluated the cost and availability of high-chromium (metallurgical-grade) chromite from the Xerolivado mine. There are four other areas that could hold future potential. The Voidolakkos area de- posits, 15 km northwest of Xerolivado, are or were, high-grade, massive, metallurgical-grade ores. As of the late 1960's, only 20 podiform ore bodies were known in the area, and they were very small in size, ranging from only 1,000 to 10,000 t apiece (62). It is possible that the 20 known deposits were mined out as of 1980 although definite knowledge to that effect is not known. An unpublished source^^ states that promising prospects are located at Aetoraches, Koursoumia, and Kerasitsa. Published information (63, p. 529) indicates that the deposit at Aetoraches contains 600,000 t. All three of these areas are located in the northern half of the Mt. Vourinhos Complex and have been indicated to play a role in the country's expansion of capacity to feed the proposed ferrochromium smelter. However, not enough is known about these recent discoveries to evaluate them at present. The Xerolivado deposits are located in the southern portion of the Mt. Vourinhos Complex, 280 km north- west of Athens and 125 km southwest of the port of Salonica. The entire Mt. Vourinhos complex covers an area of 250 sq km and is composed of interlayered peridotites and dunites. Peridotites predominate, oc- cupying an area of 200 sq km in a 25-km long trend following the regional northwest strike. Chromite ore bodies are associated with and confined to the dunite bands (63). At Xerolivado, the chromite ore is entire- ly of the banded type (schlieren). The grade of the ore is low, at around 18 to 20 pet Cr„0., using a cut- off grade of 15 pet. The Xerolivado mining area can be divided into three sections separated by two major fault zones. They are referred to as the northeast, central, and southwest sectors. Mining was begun in 1952 on the three outcropping ore bodies (lenses) in the northeast sector. This sector is now essentially mined out. Present production is entirely from the central sector where seven separate ore lenses (numbered from 7 to 13) have been outlined by underground workings. At the 910-m level, lenses 13, 12, 11, and 10 have been proven to extend for 300 m along a northeast to southwest trend, while lenses 9, 8, and 7 extend on average for 200 m along this same trend. The ore lenses have thicknesses ranging from 1 to 13 m and extend for depths of around 100 to 150 m. The ore itself consists of coarse to medium grained chromite intermixed with dunite gangue, and the Cr:Fe ratio of concentrates produced from Xerolivado ore is around 3. The southwest sector has been explored in detail only in the past 2 to 3 yr, during and since develop- ment of a 2,200-m exploration-production adit. As of 1980, extensions of four of the seven lenses in the central sector had been intersected in the southwest sector. However, no details of dimensions of the lenses intersected is currently available. Attitudes of the lenses show a progressive decrease from near vertical in the northeast sector to subhorizontal in the lower levels of the southwest. This decrease in attitude has led to the postulation that the deposits in the central and southwest sectors could link up with similar ore bodies 3 km to the south in a broad synclinal structure which would add significantly to the potential of the area (63). Any estimate of chromite resources in the Xerolivado area contains many unknowns. Unpublished esti- mates^'^ as of 1981 were that the central sector con- tained 500,000 t at a proven level and 200,000 t at a probable-possible level, while the southwestern sector was estimated to contain 100,000 t at a proven level, 400,000 t at a probable level, and 1,100,000 t at a pos- sible level. This gives a total of 2.2 million t of ore at all levels of probability. This is considered to be a conservative estimate because of the possibility of a synclinal extension to the southwest, the relative lack of indications of pinching out of the lenses, and the fact that some of the lenses have proven strike lengths of 1,000 m. However, for economic analysis, the estimated dem- onstrated resource at the Xerolivado mine that is costed for this study is the conservative 2.2 million t of in situ ore with an average grade of 18 pet Cr^O.,. Contained Cr^Og is estimated at 396,000 t. MINING AND BENEFICIATION The low-grade chromite at Xerolivado has been mined since 1952, with mining beginning as surface pits in the northeast sector where the ore bodies out- cropped. By the late 1950's access to two sectors, the northeast and central, had been developed by sinking two inclined shafts. By 1981, a 2,200-m-long explora- tion-production adit had been completed to access the southwest sector. The portal is near the site of the new beneficiation plant to be constructed in the near future. Two internal shafts were also raise-bored from the adit to the level 150 m above. It is estimated that about 1 million t of ore has been extracted over the years 1952 through 1979-80 from the Xerolivado operations (northeast and central sectors) . Three diflferent stoping methods, cut and fill, shrink- age, and sublevel, are used underground at Xerolivado, depending upon the geologic characteristics of the lense occurrence. If the thickness of the ore body is less than 5 m and the dip is less than 35°, a type of room-and-pillar method is utilized. As of 1981, only one ore body (No. 7) in the central sector was being mined by the room-and-pillar method. Most of the mining is by shrinkage stoping. In this method ore from the stopes is loaded into rail cars through chutes while in sublevel stoping, drawpoints serve as loading points. Load-haul-dump units load the ore into rail " Confidential source. ' Confidential source. cars which are hauled to the incline shaft by loco- motives. When the new beneficiation plant is complete, probably by 1984, ore from the central sector will be delivered to the internal shaft connecting with the adit below, and main rail haulage will be in the adit deliver- ing to the new mill. Operations are conducted on a 250-d/yr, two-shift- per-day basis. Recent production capacity has been about 50,000 tpy of ore. Announced plans, however, indicate that when the new mill is in operation the Xerolivado production rate will be increased to about 140,000 tpy of ore. This evaluation is based on those production rates. It should be noted, however, that even with the increased capacity at Xerolivado, only 70 pet of the announced design capacity of the new beneficiation plant is accounted for. It is most likely that the remaining 30 pet will be provided from min- ing of the Anexitika, Koursonmia, Kerasita, and other nearby discoveries which have not been evaluated in this study owing to the lack of geologic and other data. It is noted that the increasing use of mechanized loading (LHD's) has resulted in increased dilution, call sing the mill feed grade to decrease from 20 pet Cr^Og to 18 pet from 1978 to 1980 (65). Reference back to the geology and resources section will show that the demonstrated resource tonnage of 2.2 million t at 18 pet CrgO, evaluated in this study is assumed to include dilution by material of a lower grade than the 15-pct CrjO.T cutoff grade in use in the late 1970's. Mine recovery was reported to be planned at 85 pet for the years prior to the increased use of wheel- loading equipment. This study assumes a somewhat higher mining recovery of 95 pet reflecting the assump- tion that increased dilution with typical chromite lens deposits would usually be the result of increased mining recoveries. Operating costs for mining at both capacities evalu- ated, 200 and 560 tpd of ore, do not vary significantly in terms of total cost. The operating cost for the in- creased capacity using the new adit is composed of 45 pet labor costs, 40 pet for materials and supplies, and 15 pet for equipment operation. Estimated productivity for the increased capacity is 5 t per worker-shift and is modeled on 75 pet of output coming from shrinkage stoping and 25 pet from sublevel stoping. This produc- tivity is among the highest of underground chromite mines world wide. It is estimated that for the operation at 140,000 tpy, the total capital cost for mine equipment, includ- ing replacement of present equipment, would be nearly $1.5 million while mine plant investments would run about $2 million. Mine development costs are estimated to be $3 million for extraction of the 2.2 million t of demonstrated resource remaining. Total capital re- quirements for the years 1977 through the process of expansion are estimated to be approximately $10 million and include exploration, development, mine equipment, and mine plant capital costs. At present, ore from the central sector is crushed and screened to minus 60-mm at the inclined shaft and then trucked about 6 km down a rough, steep haul road to the present mill located near Skoumsta. The new, larger beneficiation plant is, or will be, con- structed very near the new adit portal not far from the old mill. The proposed new mill is designed to handle any- where from 600 to 720 tpd of ore feed (180,000 to 210,000 tpy) . Run-of-mine ore at minus 400 mm to plus 100 mm will go through single stage crushing-grinding to minus 25 mm for feed to heavy media separation and grinding-regrinding. Minus 2.4-mm material from these stages will be fed to a classification-tabling- jigging section to produce four separate concentrates with sizes ranging between 0.3 mm and 2.4 mm. Minus 0.3-mm material will be sent to high-intensity mag- netic separation for production of a fifth concentrate. Although it was not evaluated in this study, the com- pany plans at some time to install a "flotation" circuit or plant to treat the S-pet-CrgO,, "floats" rejects from heavy media separation. Operating with Xero- livado ore as feed, expected overall mill recovery is nearly 82 pet of the contained CrjO,, and concentrate grades of 51 to 52 pet CrgO., can be attained. The possi- bility of deliberately altering the flowsheet to produce a lower grade (44 to 45 pet CrgO,) concentrate has been discussed. This is because metallurgical tests have indicated that the proposed ferrochromium smel- ter to be built at Tsingeli (Almyros) would operate at optimum levels using feed of this lower grade. It is possible that lower grade ore (12 to 15 pet CrgOg) from the Anexitika, Koursoumia, and Kerasitsa de- posits would aid in this task. HIGH-CARBON FERROCHROMIUM AVAILABILITY Greece has never been a major exporter of chromite. The operation at Xerolivado was evaluated assuming that all output would be trucked approximately 180 km from the mill at Skoumsta to Almyros, the pro- posed site for Greece's first ferrochromium smelter. The smelter is under the ownership of Hellenic Ferro- alloys S.A., a 96-pct owned subsidiary of Hellenic Industrial Mining and Investment Co. of Athens. The discussions and plans for such a smelter have been conducted since the mid-1970's and as of 1982 its con- struction was underway with the assistance of Outo- kumpu Oy of Finland. Updated information is that the smelter was commissioned in the late-1982 to early-1983 period and the first shipment was made in May 1983 (6^, p. 27). The smelter is operating at 30,000-tpy initial capacity with the possibility of later expansion to 45,000 tpy. The final cost of the overall project was $65 million, which included infrastruetural investments such as road and harbor improvements, as well as the expansion of the mine and construction of the new concentrator at Skoumsta. The project was completed on time; earlier sources had reported that construction would take 3 yr, with initial startup production scheduled for late 1982 or early 1983 (65, p. 85). The process employed at the smelter includes pelletizing to 10- to 20-mm size pellets, sintering, pre- heating to 1,000° C and smelting in a 20-MVA closed arc furnace. It is herein estimated that long-run mining, bene- ficiation, and transportation costs per ton of chromite 81 concentrate from the Xerolivado operation should aver- age approximately $57.50, $18, and $35, respectively, for delivery to the smelter at Almyros (Tsingeli). The transportation distance to Almyros is essentially the same as if the chromite were exported through the next closest major port of Salonica, ranging from 160 to 180 km. The delivered cost of chromite for the pro- duction of ferrochromium at the new smelter also represents an FOB export cost. At a long-run total cost of $110.50/t of concentrate, this smelter would be utilizing, over its life, a relatively cost competitive feed material given the geographical availability of high-grade Turkish chromite at a long-run cost of approximately $99.50/t FOB Turkish ports and ex- cluding the cost of transport to Greece. Transportation costs within Greece are high relative to other chromite producers, but the government has entered into a project to modernize and electrify the railway network by 1990 at a cost estimate of $450 million (66). Given the potential of the Mount Vourinous area, it is pos- sible that the railway network may be expanded to connect Kozani with the port of Almyros. However, at a distance of 180 km, it may prove less costly to continue to truck the chromite concentrates to the smelter. Utilizing only the demonstrated resource at Xero- livado (Skoumsta) the new mill would produce around 40,000 tpy of concentrates for 14 yr, or a total of 585,000 t over the life of the demonstrated resource. Assuming a 90-pct recovery in the smelting process, this chromite tonnage would represent approximately a two-thirds smelter capacity utilization rate for the new smelter. Therefore, an additional chromite re- source of approximately 1 million t at the other, smaller deposits would be necessary for the smelter to operate over a normal 15-yr life at full capacity from domestic chromite supplies. At this time, it is believed that sufficient local chromite supply is available from the Mount Vourinous area to operate the new Skoum- sta mill and Almyros smelter at full design capacity of 30,000 tpy ferrochrome. An analysis was performed to determine the average total cost of producing grade- A, high-C ferrochromium in Greece at the proposed smelter utilizing feed from the Skoumsta mill. The analyses were performed at both the breakeven and 15-pct profitability levels. The cost estimates range from $0.49/lb Or at the breakeven level to $0.67/lb Cr in order to obtain a 15-pct rate of return on the invested capital. If the ferrochromium is consumed locally, and the project viewed as a de- velopmental objective, then the marginally economic nature of the project, as reflected in the long-run cost estimates at the 15-pct level, pose no deterrent. It appears from this long-run analysis as though the project is based more upon developmental concerns or EEC trading arrangements than international cost competitiveness. It is worth noting that Greece repre- sents the only member of the EEC (assuming its membership is retained) that possesses economically recoverable chromite resources. In addition, Hellenic Ferroalloys is jointly financing a feasibility study with Larco, S.A. (an 80 pet state-owned nickel and steel company) to investigate the possible construction of a 60,000-tpy stainless steel plant next to the ferro- chromium smelter (65, p. 85). SUMMARY A total in situ demonstrated resource of 2.2 mil- lion t was cost evaluated. This demonstrated resource is estimated to con- tain a potential 585,000 t of chromite products. Total grade-A, high-C ferrochromium potentially available from this resource is estimated at 241,000 t. Chromite production costs (as defined) are esti- mated at $57.50/t, $18.00/t, and $35/t for min- ing, processing, and transportation, respectively, for a total cost FOB the Almyros smelter of $110.50/t. High-C ferrochromium production costs (as de- fined) are estimated at $0.49 /lb contained Cr for the breakeven level and $0.67/lb contained Cr at the 15-pct profitability level. Major implications are that all chromite produc- tion will be processed locally into high-C ferro- chromium with smelter output being exported, most likely to the EEC. MADAGASCAR GEOLOGY AND RESOURCES Chromite occurs in three major districts in the northern half of Madagascar (fig. 35) : Andriamena, Ranomena, and Befandriana. Of the three, the An- driamena District deposits are by far the most im- portant in terms of resources and production. Table 43 contains the in situ demonstrated chromite resource data for the deposits and deposit groups included in each district as of 1980, along with the associated in situ weighted average grades and amount of contained Cr203. As this table indicates, nearly 96 pet of the major chromite resource of Madagascar is located in the Andriamena District. In addition, at least 95 pet of Madagascar's chromite production has come from this area. The 1980 demonstrated resource level estimated for the Andriamena District includes 1 million t con- tained within the Bemanevika deposit, 4.5 million t contained within the Ankazatoalana deposit, and ap- proximately 4.5 million t contained within 25 other fairly large lenses. The Andriamenha District is located about 180 air km north of the national capital of Tananarive and about 200 air km northwest of the port of Tamatave. The total area of the district covers a rectangular 82 Diego Suarez Nossi Be LEGEND City Port Chromite district Railroad Road (major and importo- to chromium industry) 100 200 300 Figure 35. — Location of chromite districts, transportation network, and ports of exportation In Madagascar. areal extent of about 60 km in a north-south direction and about 40 km in an east-west direction. Within this area, as many as 300 chromite lenses or eluvial de- posits of chromite had been located by 1964 (67) . The Bemanevika deposit was once the largest known depo, ; in this District. The ore was high grade (by Table 43. — Estimated In situ chromite resource data for selected deposits and districts in Madagascar, as of 1980 Demonstrated ^SaS Contained District and deposit resource', ™ho CrPj^, '^' pIlcrA ^°^> Andriamentia: Bemanevil» <»<»3 967 H 299 84 \^ s • • "^ :\ v^^.