Canada’s Top 10 Aggregate Operations

Significant industry changes reported by Canada’s biggest aggregate producers
Andy Bateman
June 11, 2009
By
Readers will not be surprised to hear that most of Canada’s largest aggregate producers reported an overall drop in 2008 volumes compared to 2007, with a strong first half in most cases overpowered by a sharp fall off in the last quarter.

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The Lafarge Texada Quarry, B.C., shipped 6.0 million tonnes in 2008.


In terms of total 2008 production, the Susan Lake sand and gravel operation of Athabasca Minerals was easily Canada’s biggest single aggregate producing location with 11.8 million tonnes. Unlike all the other producers in our Top 10 listing however, Susan Lake’s huge production number is the combined total of a number of separate portable production spreads, operated by different companies on the same property. (See “Giant operation meets demand” ).

Kevin Spenst, general manager of second placed Lafarge Texada, decribes 2008 as an “interesting” year for the quarry operation on B.C’s Texada Island. “After record sales of 7.3 million tonnes in 2007, we began 2008 year with optimistic goals. Project work started in 2007 was supposed to carry us through the first half and anticipated work for the second half of the year should have seen volumes near 2007 levels. With the market downturn in the second half of the year, project work slowed, and our total volumes for 2008 fell to 6.0 million tonnes.

The quarry continued its exceptional safety record with no lost time accidents surpassing six years. Medical and first aids were reduced along with a significant drop in our incident levels. The employees of the quarry diligently worked to create an environment in which personal safety was the number one priority for the quarry. Conveyor safety, working at heights, confined spaces, and dust and noise monitoring were the major focus for 2008.

There were no major capital expenditures at the quarry in 2008, with the focus for the year on cost controls and process improvements. Efficiencies were gained through screen changes, plant set-up changes, and production scheduling. Numerous operational improvement studies were implemented at the quarry in 2008, notably on fuel consumption and blasting.

In 2008, Lafarge Texada was recognized for two exceptional environmental honours. The Wildlife Habit Council – Wildlife at Work Certification was awarded to the quarry for creating an environment in which native plant and animal species coexist and flourish within the quarry boundary. The second award received by the quarry was the NSSGA (National Sand, Stone, and Gravel Association) Silver Environmental Excellence Award. This award was for long standing service and dedication to the preservation and enhancement of the wildlife and plant life in and around our quarry.

On the marketing side of the business, Texada’s main customer base continues to be supply to the cement plants, with construction aggregates being supplied into Seattle, Hawaii, and Vancouver. Lafarge Texada continues to look for new customers for its products, with construction aggregates and speciality aggregates the growth focus for the next few years. Specific project work along the West Coast and Pacific Rim, construction aggregates into the large markets, and customers for white limestone will lead the growth. Texada Quarry also actively trans-ships products for customers along the west coast.”

Top10-S1  
Capital investments at the Sechelt, B.C. sand & gravel operation of Lehigh Materials Ltd. included the installation of a new 3.05 m by 12.2 m KPI-JCI classifier.  
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2008 also saw the installation of a Binder 2.8 m by 6.0 m pit scalping screen at Lehigh Materials Limited’s Sechelt, B.C., operation to increase production capacity.

 
Lehigh Materials Sechelt
Mike Latimer, mine manager at the Sechelt B.C. sand & gravel operation of Lehigh Materials Limited, reports that 4.33 million tonnes were shipped from Sechelt in 2008. Fixed equipment changes during the year included the installation of a Binder 2.8 m by 6.0 m scalping screen and a secondary jaw crusher to increase production capacity.

A Symons 5-1/2' standard head cone crusher was replaced with a reconditioned Symons 5-1/2' standard head cone crusher. Additional changes included the installation of a new 3.05 m by 12.2 m KPI-JCI classifier, the upgrading of numerous belt scales and a new mobile equipment fuelling station. Latimer adds that capital expenditures in 2008 were greatly reduced throughout all areas in the Heidelberg, Lehigh Hanson group of companies. At Sechelt, mobile equipment additions consisted of a Caterpillar 769D water truck with a 32,175 litre capacity tank. Capital expenditures will remain low in 2009, with one approved project to replace an 8 by14 McLanahan rotary scrubber. Sechelt was not without operational challenges in 2008. In February, a 13-month old, 67 m long radial stacking conveyor collapsed, reducing the ability to supply material from the pit through a temporary conveyor system and resulting in lower tonnages of processed product. A redesigned stacker utilizing some of the mechanical components of the failed stacker was installed and commissioned in June 2008. By mid November, softening demand was reflected in high inventories and the operation was reduced from two production shifts to one. Sechelt returned to full production in February 2009. On the marketing side, some 15% of Sechelt’s 2008 sales were to Lehigh Hanson Materials in California and these are predicted to be approximately 750,000 tonnes for 2009. Demand for concrete aggregate is much lower and down approximately 40% for the start of 2009. To boost volumes, the operation is producing more construction and road base materials, although sales revenue will be lower. Latimer is looking to an overall improvement in demand in the third and fourth quarters of 2009 as demand in Vancouver and Lower Mainland markets recovers.

Top-10-T2
 
Many of the country’s aggregate operations are involved in environmental improvement programs. In 2008, the Lafarge Texada Quarry received both the Wildlife Habit Council – Wildlife at Work Certification and the NSSGA (National Sand, Stone, and Gravel Association) Silver Environmental Excellence Award.

 
Lafarge Manitoulin
Perry Newman, plant manager of the Lafarge Group’s Manitoulin Quarry at Meldrum Bay, Ont., reports 2008 production of 3.74 million tonnes or about 15% less than the 4.4 million tonnes reported for 2007. Newman also reports lower capital investments in 2008, with fixed equipment changes including the replacement of an old 4 by 20 secondary vibrating grizzly screen with a larger 8 by 20 Simplicity grizzly unit. There were no new mobile equipment additions of note. The Manitoulin operation is impacted by the fortunes of U.S. economy as a significant percentage of Manitoulin’s output is shipped to U.S. markets on the Great Lakes. Like a number of other producers, Newman is not making any predictions for 2009, adding that it is too early to tell the impact of the U.S. infrastructure package.

Mainland Sand and Gravel, Cox Station
Ted Carlson is president of Mainland Sand and Gravel Limited, whose operations include the Cox Station granite quarry located at Sumas Mountain near Abbotsford, B.C. Carlson reports that 2008 production at Cox Station was virtually unchanged as 2007 at 2.5 million tonnes. The similarity between the two years ends there. A very strong first half in 2008 was followed by a noticeable softening of sales in the summer and a sharp drop off in the traditionally strongest months of September, October and November. At this point, 2009 promises to be “dramatically different” with the impact of lower demand across the Greater Vancouver Area made worse by relatively severe weather.

Carlson adds that there was a noticeable decline in building permits applications in the months of November, December and January, although there has been something of an up tick in February 2009. Typically, there is a lag of about four months between building permit applications and the beginning of construction. With little subdivision development or private money, one of the area’s bigger residential contractors is now bidding government and infrastructure work. The same contractor has its own sources of aggregates, thereby reducing the size of the market available to suppliers such as Mainland. Putting this picture together, Carlson sees overall 2009 volumes falling significantly, with a 40% drop to some 1.5 million tonnes.

Mobile equipment additions at the quarry in 2008 included a number of Caterpillar units including five 980H wheel loaders, two 775F haul trucks and two 740 Articulated Dump Trucks (ADT’s). Carlson adds that the new wheel loaders replaced five older series loaders from Komatsu early last year, with that decision driven primarily by a detailed analysis of fuel efficiency in the face of steeply rising fuels costs at the time. In addition to the mobile equipment changes, aggregate processing equipment additions at Cox Station included a 30 by 48 portable Lippmann jaw crusher and a 36 by 150 KPI-JCI Superstacker.

Two new aggregate products have helped combat reduced sales. The first, a new washed crushed fines product allows hot mix asphalt producers to increase the percentage of reclaimed material in RAP mixes. The second product is a granular base material utilised under synthetic sports fields. This product can be compacted to provide a stable base underneath the synthetic surface while simultaneously providing free drainage. Last but not least, 2008 saw the implementation of an extensive safety program at Mainland and Carlson commends the hard work put in by all employees in the program’s design and implementation.

This year, Mainland hopes to commission its new primary crushing plant in the east quarry, a quarry development project that has taken longer to develop than originally planned. Plans call for the installation of a Metso 54 by 74 gyratory primary crusher against the quarry face and the decision to go ahead with the primary installation will be dependent on both market conditions and the prices quoted to complete the work. Project completion now will position the business for long term growth and, with an estimated 20% reduction in production cost, the project may even be self funding. Should it go ahead, this project will represent most of the 2009’s capital expenditures.

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The Villeneuve pit of Inland Aggregates, near Edmonton, Alta., shipped 3.4 million tonnes in 2008.

 
Inland Aggregates Villeneuve
At the Villeneuve Pit of Inland Aggregates near Edmonton AB., operations superintendent Brian Puchala reports that the Heidelberg acquisition of Hanson has bought plenty of changes and challenges but is a very good long term move for Heidelberg. Capital expenditures at Villeneuve have been low, with no new fixed or mobile equipment. Puchala adds that market demands peaked in 2007 and levelled off in early 2008. Declines for 2009 are very noticeable but the actual percentage decline is unknown at this time. For Puchala, current challenges include the retention of present customers let alone new projects that are few and far between. Overall, it is not all doom and glow however, with Puchala projecting that “2009 might finish at 2003 / 2004 levels which were still good and not all bleak.”

Dufferin Aggregates Milton
Mark Graves, quarry manager at the Milton, Ont., quarry of Dufferin Aggregates, reports 2008 production volume of 3.4 million tonnes and anticipates similar production volumes for 2009. Even nine months ago, a flat prediction such as this might have been regarded as conservative but as some industry observers have said, “flat is the new up.” Good news from Graves also includes a good safety performance at the Milton Quarry, with over 1137 days without a lost time injury as at April 26, 2009.

Construction of the next phase of Milton’s Water Management system has commenced, which will expand the recharge well system an additional 1.2 km around the West Cell of the Extension License to the existing 2.7 km North Quarry recharge system which has been operational since June of 2007.

The water management system aside, there will be only modest process capital expenditure at Milton, with no changes in fixed or mobile equipment in 2009. Graves reports that the main operational project in 2009 will be the completion of the final face of the Town Line Rock Pillar. Specialty blasting techniques have been developed to limit ground vibrations to ensure the structural integrity of the 60 m wide by 40 m tall rock pillar. This is the first of two rock pillars which are an integral part of the final rehabilitation plan which will create separate lakes when the quarrying operations are complete.

Community relations activities at Milton include Earth Day with the planting of 5,000 tress and over 500 volunteers including Scouts, Guides, neighbours, consultants, stakeholders and staff participating in the event. Graves adds that the Milton Quarry has hosted this event for 18 years and in 2008 the 100,000th tree was planted in the quarry.

Lafarge Dundas
At the Lafarge Dundas, Ont., operation, quarry manager Ron Graham reports 3.6 million tonnes of production for 2008. Like virtually all producers across the country, shipments of construction aggregates from Dundas were impacted primarily by the slow down in residential construction. Volumes remained in line with the rest of the industry during the first half of 2008, but then slowed considerably, particularly in the last quarter. Dundas volumes have also been adversely affected by the declining fortunes of the steel industry.

On the operational side, capital investments at Dundas have included the installation of two new 8 by 20 Cedarapids triple deck screens during the quarry’s winter 2008/ 2009 maintenance program. Graham explains that this was done to replace existing units of the same size as part of the continuous improvement maintenance program. On the mobile equipment side, a new Caterpillar 777 haul truck was purchased to replace an existing 777 that had reached the end of its life cycle.

At the time of writing, production at the steel plants in the City of Hamilton has slowed and in some instances been suspended. It is uncertain if and when production will resume. With the demand for construction aggregates also uncertain at this time, Graham is understandably cautious about making any predictions for the remainder of 2009.

  Canada’s Top 10 Aggregate Operations in 2008 Million
 tonnes
Type
Shipment Method  
 
 
  1 Susan Lake
- Athabasca Minerals (AB)
 11.8 Sand & Gravel
Truck  
  2
Texada Quarry
– Lafarge Canada (BC)
 6.0
 Limestone  Water  
  3
Sechelt Pit
- Lehigh Materials (BC)
 4.8  Sand & Gravel  Water  
  4
Manitoulin Quarry
– Lafarge Canada (ON)
 3.7  Limestone  Water  
  5
Porcupine Mountain Quarry
– Martin Marietta (NS)
 3.7  Granite  Water  
  6
Dundas Quarry
– Lafarge Canada (ON)
 3.6  Limestone  Truck  
  7
Villeneuve Pit
- Inland Aggregates (AB)
 3.4  Sand & Gravel  Truck  
  8
Milton Quarry
– Dufferin Aggregates (ON)
 3.4  Limestone  Truck  
  9
St Eustache Quarry
– Les Carrières St Eustache (QC)
 2.7  Limestone  Truck  
  10
Cox Station Quarry
- Mainland Sand & Gravel (BC)
 2.5  Granite  Water  

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