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Luossavaara-Kiirunavaara Aktiebolag (LKAB )

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Luossavaara-Kiirunavaara Aktiebolag (LKAB ) LKAB – Briefing Thailand’s Office of Industrial Affairs, Vienna Luossavaara-Kiirunavaara Aktiebolag (LKAB ) General information Luossavaara-Kiirunavaara Aktiebolag (LKAB) is a Swedish mining company. The company mines iron ore at Kiruna1,Malmberget2, Svappavaara3 in northern Sweden. LKAB was established in 1890, and has been 100% state-owned since the 1950s. The firm’s main products are pellets and sinter fines4, which are processed from iron ore. It has two main transport hubs linked by Ore trains (Malmbanan) connections at Narvik and Luleå harbours. LKAB also owned a steel mill at Luleå (SSAB). Figure 1 Iron ore is extracted in Kiruna, Svappavaara and Malmberget (outside of Gällivare), and brought by rail to the harbours of Luleå and Narvik. Their production is sold throughout the world, with the principle markets being European steel mills (Germany, Sweden, Finland, Netherland, Belgium, UK), the Middle East (Saudi Arabia, Qatar),as well as North Africa, and Asia (China, Turkey)5. LKAB has around 4,000 employees, of which more than 600 are outside of Sweden. There are iron ore mines, processing plants and ore harbours in northern Sweden and Norway, and sales offices in Belgium, Germany and Singapore. LKAB has subsidiaries for industrial minerals with processing plants in Sweden, Finland, Greenland, the UK, the Netherlands, Greece, Turkey and China. Additional subsidiaries are in Germany, the USA and Hong Kong as well as representative offices in Slovakia and Thailand. LKAB’s chief assets are among the magnetite ore fields of northern Sweden. Its corporate headquarters are in Luleå and the main production sites are in Kiruna and Malmberget, close to 1 the world’s largest underground iron ore mine. 2 world’s second largest underground iron ore mine. 3 Newest mining area (open pit) 4 LKAB products are processed iron ore products for steelmaking and supplier of mineral products for other industrial sectors 5 http://www.lkab.com/en/About-us/Overview/Customers/ 1 | P a g e LKAB – Briefing Thailand’s Office of Industrial Affairs, Vienna Gällivare. The ore is partially processed on site, and is transported by freight train on Malmbanan to either Narvik6 or Luleå7 depending on final destination. Subsidiaries8 LKAB consists of seven subsidiaries: 1) LKAB Minerals – processes and customised minerals 2) LKAB Wassara – R&D systems for effective drilling in rock and soil.3) LKAB Berg & Betong - Sweden’s largest producer of spray-on concrete. 4) LKAB Fastigheter - Manages housing and other premises in LKAB’s operations areas 5) LKAB Kimit-Production and delivery of explosives products, 6) LKAB Mekaniska-One of Sweden’s biggest mechanical engineering workshops, and 7) LKAB Malmtrafik- Rail traffic management. Subsidiaries of LKAB provide supports to its main business (transport, explosive, process mineral, drilling technique). The management of organization is done in this way, perhaps to maintain the advantages of small business units (such as flexibility and control) while enable the business as a whole to increase in size. Mining procedure Most of LKAB ore deposits must be extracted from underground mines but some of them are also from the open pit. The underground mining employ Sub-level Caving technique and the open pit excavation use Bench mining technique. (Daily extract from Kiruna mine is 76,000 tons). Sub-level Caving technique9 1. Drifts (or ore transport roads/tunnel) construction by 2. Production drilling, 40-55m long holes are drilled into orebody 3. Blasting-cream explosive are pumped in, 20-30 tons of explosive are detonated every day 4. Loading-after blast ore is removed from the drifts 5. Transport – ore is transported from rock bins to cruscher 6. Crushing – ore boulders are crushed into 10-centimere pieces 7. Hoisting – ore is loaded and hoist to the surface Bench mining technique10 1. Level cutting – peeling of surface (in 15m depth per level), holes are drill in and ore is blasted free and extracted at the lower level 2. Shaping-sloping of surrounding area to minimise rock fall 3. Drilling by tracked drill rigs is made according to rock quality and desired fragmentation 4. Blasting 5. Loading – ore is loaded, transported and crushed before onward transport for further processing 6 LKAB’s biggest harbour with 20 million tons per year 7 Serving customers in the Baltic market 8 http://www.lkab.com/en/About-us/Overview/Subsidaries/ 9 http://www.lkab.com/en/About-us/Overview/Mining/Sub-Level-Mining/ 10 http://www.lkab.com/en/About-us/Overview/Mining/Bench-Mining/ 2 | P a g e LKAB – Briefing Thailand’s Office of Industrial Affairs, Vienna Refining procedure The ore is process to increase quality of the final products, by 1. Dressing – separation of waste from rock surrounding ore body 2. Concentration – the ore is grinded and sorted. Impurities are removed by wetting the ore into slurry and concentrated into pellet feed (with 70% pure iron content) 3. Pelletization- LKAB employs its in-house technique. Ore in pellet shape is easier to transport and has processing advantages11 Quality and Environment Several measures are employed to ensure higher quality and environmental friendliness of the LKAB’s operation12. - Employs the Total Quality, ISO-certified quality assurance system and certified o ISO 9001:2000 (Quality standard) o ISO 14001 (environmental management) o SS627750 (Energy management standard) - Focus on high quality feedback from customer (near zero complaints) - LKAB uses around 1.5% of Sweden total electricity, and energy cost made up to 10% of LKAB’s total expenditure the following measures are employed to ensure energy efficiency: o Reduce consumption through efficiency and find alternative source of energy o Work closely with Swedish Energy Agency o Run trial project to increase availability of renewable energy (Vindln – invest in 5 wind 10MWh turbines) o Rely on rail transport (IORE – the strongest locomotive in the world) o Use computer to aid train operation (CATO) - Green pellets o LKAB’s magnetite pellets production required less energy and produced less emission . Carbon dioxide emission are reduced by 85% compared with sintering fines and 30% less than hematite pellets, . Total emission from the mine to the blast furnace by 30% compared to hematite sinter . Increase customer’s steelworks by value-in-use - Environmental impact o Increases the amount of all waste sorted from 39% to 89% within 3 years o Reduce emission of particulates, sulphur dioxide and fluorine by 50% since 1980 although the production amount tripled o Reuses around 75% of water in mining and concentration processes o Surplus water are checked biologically and chemically before discharged o Monitoring of change in landscape and deformation of rock 11 http://www.lkab.com/en/About-us/Overview/Refining/Pelletization/ 12 http://www.lkab.com/en/Our-Approach/Quality-and-Environment/ 3 | P a g e LKAB – Briefing Thailand’s Office of Industrial Affairs, Vienna o Participate in ULCOS (ultralow CO2 steelmaking) research project, which majority of works are carried out at LKAB’s own Experimental blast furnace in Luleå. o Dedicated policy for environment and energy policy13 o Working closely with the communities Mining and Urban transformation The mine is continued to expand, to meet growing demand for iron ores (especially from China). LKAB plans to increase production to 37 million tonnes of finished products – a 35 per cent increase. The firm expects to hire 1,200 additional employees between 2011 and 2015. The expansion of the mine will affect the town of Malmberget because the ore deposit line slope down under the community. It is estimated that about 3,500 people in Malmberget need to be relocated over the next 20 years. It is a great transformation of the town, affecting residents, municipality, landowners, government agencies, LKAB, and other stakeholders. The new community will become part of Gällivare. Figure 2 LKAB’s deformation forecast up to 2027 of how mining will affect central Malmberget Source: FUTURE ON THE URBAN TRANSFORMATION IN MALMBERGET, LKAB. LKAB has allocated SEK 6 billion to the urban transformation of Malmfälten, of which half (SEK14 3 billion) goes to the transformation of Malmberget. SEK 430 million of that is compensation for municipal infrastructure that LKAB will buy and pay for in conjunction with the negotiated agreement. We will continue to allocate money to the urban transformation of Malmfälten. 13 http://www.lkab.com/en/Our-Approach/Policies/Environment-and-Energy/ 14 1 SEK equates to 0.11 Euro 4 | P a g e LKAB – Briefing Thailand’s Office of Industrial Affairs, Vienna Figure 3 What will be affected Source: FUTURE ON THE URBAN TRANSFORMATION IN MALMBERGET, LKAB. 5 | P a g e .
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