Quarrying & Mining Magazine
Gold Mining

Heart of gold

All stops are being pulled to extend the shelf life of Macraes, our largest gold mine set in the rolling tussock hills of East Otago. DENISE MCNABB visits the mine to meet manager, Matt Hine, whose mandate for a high-achieving and happy team is one for the books.

Macraes’ general manager, Matt Hine.

YOU WOULD BE BE HARD-pressed to pick Macraes’ general manager Matt Hine among his team of supervisors gathered for their weekly meeting in the elderly Coronation Hall on the main street of whistlestop town, Macraes.

He, like the 20 others, including women, wear the same mine kit – an orange shirt striped with reflective silver, navy trousers and steel cap boots.

This third generation miner from Kalgoorlie, Western Australia arrived at Macraes nine months ago to take the reins and is not one for hierarchical structure.

He quietly takes notes as team leaders give their feedback about sectors different to their own. They’ve been assigned to observe and learn, including ways to improve safety.

One supervisor points to inconsistencies around wearing gloves on site, another to safety procedures that had resulted following an explosion in a digger bucket some years ago. There are also observations about crucial behaviours in different work situations, hearing protection and about reinforcing the need for slowing and assessing the risk of everything done at the mine.

But, first they are treated to a history lesson about the area from Neil Roy, a retired farmer whose great-great grandfather arrived from Northern Ireland to settle in the nearby Moonlight area in 1883.

Macraes community and environmental manager, Gavin Lees, has set up the slide presentation.

The shabby hall with its peppermint walls, old bench seats, tiny stage and remnants of days as a school are far removed from the leaden grey bowels of vast terraced pits where crews drive and dig around the clock in oversized trucks, excavators, loaders, dozers, drills, rigs and graders.

Yet the hall is perfectly adequate for an off-premise meeting of miners.

Neil’s memory is as sharp as a tack about the colourful history of the region first surveyed in 1851 and named after John Macrae, a boundary rider who arrived before gold was discovered.

He says Macrae was fingered late in his life for murder after his neighbour’s jaw was blown off, but was never charged because people said at the time that he was too blind to fire a shotgun.

Neil’s tidbits and local knowledge add richness to the tales of the district that took off in 1862 when prospector, James Crombie discovered alluvial gold in Deepdell Creek, an area that today is within the 15,705 hectare boundary of Macraes’ permits. 

Others gold discoveries were made nearby soon after and in 1863 Murphy Flat became Macraes Flat (the Flat name was only dropped in 2015) and a bank, four pubs, a baker and a general store sprung up to service the burgeoning population of 380.

In subsequent years boom turned to bust before exploration was rekindled in the 1980s, leading to the incorporation of the Macraes mine company in 1990.

Before their lunch, the supervisors are shown on a screen who reached gold standard targets for February and those that did not, based on their task logs. The charts were mainly gold.

Today only the Historic Places Trust-designated Stanley Hotel, remains of the four hotels.  Macraes’ Australian owner, OceanaGold Corporation, bought the hotel in 1997 as a place where mineworkers (presently 594 staff and 200 service contractors) and the local community would continue to be able to dine and socialise.

Later, the company set up the Macraes Community Development Trust and gave it the hotel to run, along with community funding to restore other buildings.

Happiness equation

It’s a sunny autumn afternoon and over lunch in the garden at the back of the hotel when Matt grabs a notepad to draw up his “positive psychology” chart, drawing on the theories of American psychologist, Martin Seligman who preaches the “science of happiness”.

He writes “PERMA” down the page, an acronym for Positive emotions, Education, Relationship, Meaning/purpose and Achievement.

Matt exudes a passion for PERMA’s application in ever facet of the mine.

It is no coincidence though that OceanaGold Corporation has hired a manager with his instincts to bring the best out in the company’s workers.

At its investor presentations it puts “value creation” at the centre of its business strategy and among its key drivers for efficiency are technical excellence, leadership and effective management and organisation.

Pointing to “Achievement” in the PERMA chart, Matt says mining is a challenging industry where the average pay is higher than most.

He says a highschool leaver who is prepared to put in the hard yards, working shifts and overtime and sacrificing weekends, can earn an annual salary of $100,000 after a year and get certified in the process.

“For us it’s about making sure that sacrifice is worth it,” he says.

But he also notes that after the higher salary has kicked in people always want more out of their job.

He says that level is about having a passion for the job, about being happy to come to work.

He believes the key is a culture built on accountability, teamwork, innovation, respect, performance and integrity.

“I think Macraes has survived because of its people,” he says.

“They’re innovative, high on teamwork and they have a lot of accountability.

“It’s one thing showing up for work but a good frame of mind and work/life balance is the key.”

Macraes might be a world away from Australia’s super pits, but Matt feels right at home and already considers himself a New Zealander. He lives with his family in Dunedin.

With a Bachelor of Mining Engineering from the University of Queensland and other mining qualifications under his belt, Hine worked in several management roles in Australian copper and gold mines.

Prior to arriving in New Zealand he was open pit and underground manager at Evolution Mining, not far from Kalgoorlie in Western Australia where he was born.

The third generation miner got his first taste of this country on a visit to the country a decade ago. 

“Why Macraes?” he asks.

“It’s the best mine in the world and it’s also a fantastic part of the world.”

It doesn’t take long to see evidence of his positivity and work ethic percolating through staff he meets. But he points out the work ethic is nothing new. He is just rolling it along.

Gold was discovered at Coronation mine in 2015.  Frasers Pit. OceanaGold – Macraes has a comprehensive and multitargeted community programme.Truck loading up.

A safe pair of hands

Mining planning engineer, Sally Harrison, drives the 4WD towards the Coronation North pit, discovered five years ago by senior resource geologist, Sean Doyle.

Before the journey staff are quick to assure she is the safest driver you could have.

Moving cautiously along gravel ridges alongside the pits she relays by radiotelephone when she is crossing the tracks of working vehicles and machinery to the control room back at the main office.

Upon arriving at the pit edge an instilled safety regime is put into action with hard hats and safety glasses donned, along with safety vests.

Sally explains how growing up in the Tokoroa/Taupo area, she had her mind set on a career in forestry. That all changed when she got a temporary job at Waihi, OceanaGold’s North Island mine.

After gaining a Bachelor of Science, Earth Sciences from Waikato University she later got a MsC in Mining Engineering at Exeter University in the UK. Her work has taken her to London, Australia, Zambia then back to New Zealand to Macraes.

In her LinkedIn CV Sally, like Matt, describes her passion for the job. She talks of self-motivation, responsibility, integrity, ability and a dynamic personality for bringing new tools and technique and geological and field experience to the table.

Sally has only been at Macraes a few months, but it seems like she has long been a safe pair of hands at the site. From the perimeter of the pit she points to a uniform grey landscape of schist rock.

“On another day you will see the quartz,” she says, in the direction where there is the vague outline of a seam far below that is rich in gold.

Diggers are industriously excavating as this pit provides riches to extend longevity of the mine.

Just a few years ago it would have reached extinction, but ongoing work at Coronation and the underground mine at Frasers Pit are key to extending the mine life by up to 10 years.

It’s a marked turnaround from three years ago when the expectation was that it would be expended by next year.

Back at the mine’s headquarters, Janice Harvey, the person on the other end of the radiotelephone to Sally, is simultaneously watching a bank of screens in the control room where every facet of the mine work from each shovel of ore dug from the ground to processing is meticulously monitored.

A mine stalwart, Janice has worked on machinery in the pits and has family working there too.

She considers that like the mines, there is a lot of work in her yet.

Close to home

Geologist Sean Doyle, who discovered the gold at the Coronation mine in 2015, says the ability to commute daily to the mine is a big plus for staff, especially for those with families.

He says the fly-in fly-out (FIFO) systems that are necessary at Australia’s remote mines are hard on families and can lead to break-ups.

Staff who work on shifts around the clock, seven days a week, travel up to 100 kilometres each way to Macraes from as far away as Dunedin and Oamaru. They are considered locals in mine terms and Macraes provides free daily bus services for those who don’t want to drive, from Dunedin, Waikouaiti, Oamaru, Waitaki and Palmerston.

Mine manager Matt Hine adds that it keeps more than 150 cars off the road. The service also ensures fatigued workers get home safely after their shift.

Matt is used to measuring travel distances in thousands of kilometres in Australia so he finds driving the 91 kilometres to the mine each day from Dunedin where he lives with his family, a breeze. He never tires of the trip with its changing scenery.

He is also only too aware of the negativity some parts of society throw at mining – not only because of environmental disruption but also because of the high risks that go with the territory.

The Pike River coalmine disaster is still raw in people’s minds, he adds.

And OceanaGold has not been immune from tragedy either. In 2016 a miner at its Waihi mine died when a front-end loader rolled in the underground mine.

To show the benefits the mines bring for New Zealand OceanaGold commissioned accounting firm KPMG in 2016 to write a report that not only explained the nature of gold mining, but also illustrated the company’s economic, social and environmental contributions.

It said 81 percent of Macraes employees lived locally to the site and 59 percent at Waihi, resulting in $64 million of wages and benefits being retained predominantly in those districts.

The company’s spend in the national economy was estimated in 2016 at $373 million, including payments to local or national suppliers and contractors, government employees as well as community investment activities – financial and in-kind support. Of this expenditure, 88 percent reached people and businesses through wages and procurement.

The mines’ export value of 1.1 percent was comparable to other primary and agricultural industries, the report said.

Macraes’ gold is sent to the Perth Mint as doré bullion (unrefined alloy of gold and silver, approximately 92 percent pure). The value in 2016 was around $512 million and was the second largest export to Australia behind crude oil

“We want a mature conversation around the benefits of cost and to be part of a sustainable future,” Matt says.

Social responsibility

The company works closely with Otago University, which has overseen more than 200 dissertation papers related to the mine.

Last year manager Matt Hine spoke to geology students about understanding the habitat they work in.

“We have rock wrens up here that are native to the Otago area,” he says.

Matt says both corporate and social responsibility feed into the culture of why the mine does what it does.

This ranges from the application of water management and revegetation techniques to rehabilitating sites and establishing registered covenants to protect significant local flora and fauna.

The company also gives directly to the community. It made a $150,000 donation to a new medical centre in Palmerston, $100,000 to local schools and education trusts and $126,000 to community and sporting clubs, including sponsorship of Otago rugby, for example in 2016.

Future targets

OceanaGold’s chief executive, Mick Wilkes, who once worked at Macraes, said in a recent company update that he expected strong production from the mine in 2019. But, it would be less than 2018 due to the processing of a greater amount of lower grade ore from the Coronation and Frasers pits, though this would partially be offset by higher grades from Coronation North and Frasers’ underground operations. He also forecast production this year of 550,000oz of gold from the four mines (533,300oz in 2018) at Macraes and Wahi in New Zealand, Haile in the United States and Didipio in the Philippines.

“The company is currently reviewing its long-term mine plans while conducting project studies and investing in exploration, with the objective of extending the mine life at Macraes,” says Mick in a stock exchange statement. Exploration costs at the mine associated with potential mine life extensions this year are forecast at between US$7 million ($10.18m) and US$10 million ($14.55m).

And that’s a quantum change from three years ago when the mine’s life was expected to be over by now.

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