Northern System

Overview

Iron Ore production of Vale

Vale conducts its iron ore business in Brazil primarily at the parent-company level and through its wholly owned subsidiaries Urucum and MCR. All mines are open pit, and their related operations are mainly concentrated in three systems: the Southeastern System, the Southern System and the Northern System, each with it s own transportation capability. Vale also conduct mining operations in the Midwestern System and through joint venture Samarco.

The Northern System

The Northern System mines, located in Carajas mineral province of the Brazilian state of Para, contain some of the largest iron ore deposits in the world. The reserves are divided into northern, southern and eastern range situated 35km apart. Since 1985, Vale have been conducting mining activities in the northern range, which is divided into three main mining bodies, N4W, N4E and N5. The Northern System has open-pit mines and an ore-processing plant. the mines are located on public lands for which Vale holds mining concessions.

Vale operates an integrated railroad and maritime terminal network in the Northern system. The Carajás Railroad (known by its Portuguese acronym, EFC) transports the ore to Ponta da Madeira Maritime Terminal in the state of Maranhão, from where it is exported. Vale also has a pelletizing plant in São Luís, Maranhão, that processes material from Carajás.

To support Vale Carajas operations, Vale has housing and other facilities in a nearby township. There operations are accessible by roads, air and rail.

The Carajas Serra Sul S11D is a development project consisting of a mine and a processing plant having an estimated nominal capacity of 90 Mtpy. Start-up is expected for the second half of 2016. Capex was estimated at US$8.039 billion.

Expansion of Northern System railway and port capacity, including the construction of a fourth pier at the Ponta da Madeira maritime terminal in the Brazilian state of Maranhao was underway and expected to cost US$11.4 billion. The project will increase EFC’s logistics nominal capacity to approximately 150 Mtpy. As of December 2011, the project was 67% complete, with total realized expenditures of US$2.3 billion. Start-up was expected for the first half of 2014.

Location

The Northern System mines, located in Carajas mineral province of the Brazilian state of Para, contain some of the largest iron ore deposits inthe world. 

The Carajas region iron ore deposits were discovered by accident in the late 60s when a helicopter was forced to land on a hill in the area to refuel. Surveyors on board remarked the high iron content of the rocks that made up the hill and reported that to their employer: US Steel, an American company.

Para is a state in the north of Brazil.  Its most famous icons are the Amazon River and the Amazon Rainforest.

Climate is equatorial with no dry season.

Geology & Mineralization

The Northern System's reserves are among the largest iron ore deposits in the world. These reserves are divided into two main ranges (north and south), situated approximately 35 kilometers apart. 

The Carajás ores are found within Archaean banded iron ore formations. Oxidation is observed to a depth of up to 500m in the banded iron formations (BIFs) of the ore zone contributing to an iron ore enrichment of the zone.

The upper 80% of the iron ore reserve comprises a soft, friable iron enriched limonite which grades down into hematite to a vertical depth of around 300 m. The soft hematite layer contains hard hematite rich siliceous pods which transitions at depth to a lower grade unaltered BIF.

Iron ore reserves as of Dec.31/2011, were estimated at 7,383 million tonnes grading 66.7%.

Vale and BNDES, the Brazilian state-owned development bank, are parties to a contract relating to mineral exploration & mining of certain unexplored mineral deposits that form part of Vale’s Northern System (Carajas), as well as proportional participation in any profits earned from the development of such resources.

The Northern System deposits have the high iron content, 66.7% on average, with 7.3 billion tons of iron ore (proven and probable reserves).

Mining & Operation

The method of mining is conventional, with the open-cast ramps, drilling, blasting, and the carrying and transport of mined material by truck, off-road, to the plant installations for processing. 

The Northern System iron ore mines and their 2011 stated mine life is as follows:

-          Serra Norte: N4W (1994-2037); N4E (1984-2021); N5 (1998-2027);

-          Serra Sul: S11 (to start in H2 2014 with mine life to 2065);

-          Serra Leste:  SL1 (to 2064).

The Northern System consists of the Carajas Mountain Mining Complex and the Maritime Terminal of Ponta da Madeira (TMPM) located in Brazil.

The Northern System also includes the Sao Lui­s pelletizing plant. Carajas iron ore is sent to this plant and ship its production to customers through our Ponta da Madeira maritime terminal.

The Carajas Serra Sul S11D is a development project consisting of a mine and a processing plant having an estimated nominal capacity of 90 Mtpy. Start-up is expected for the second half of 2016.

Processing

The Northern System deposits have the high iron content (66.7% on average) in the Northern System deposits, that they do not have to operate a concentration plant at Carajas.

The beneficiation process consists simply of sizing operations, including screening, hydro-cycloning, crushing and filtration. Output from the beneficiation process consists of sinter feed and pellet feed. Vale obtains all of the electrical power from the Northern System at market prices from regional utilities.

EFC is located in the Northern System, beginning at the Carajas iron ore mines in the Brazilian state of Para and extending 892 kilometers to Vale’s Ponta da Madeira maritime terminal complex facilities located near the Itaqui Port in the Brazilian state of Maranhao. Its main cargo is iron ore, principally carried for us. It has a daily capacity of 313,970 metric tons of iron ore. EFC supports the largest capacity train in Latin America, which measures 3.4 kilometers, weighs 42,300 gross metric tons when loaded and has 330 cars. 

Expansion of Northern System railway and port capacity, including the construction of a fourth pier at the Ponta da Madeira maritime terminal in the Brazilian state of Maranhao was underway. The project will increase EFC’s logistics nominal capacity to approximately 150 Mtpy. As of December 2011, the project was 67% complete, with total realized expenditures of US$2.3 billion. Start-up was expected for the first half of 2014.

According to company's statements, the S11D mine and the plant will be saving 93% and 77%, respectively, in water consumption and fuel, allowing a 50% reduction in emission of greenhouse gases, when compared to conventional methods. The dry processing will also reduce the power consumption by 18 000 MW per year and it would be eliminating the use of tailings dam, minimizing intervention in native environments.

Environment & Community

N.A.