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Mining power plant

John Seelmeyer

Newmont Mining Corp. is talking with

potential partners about construction of a

480-megawatt power plant near Carlin as

the mining industry continues to look for

ways to reduce its energy consumption

and its energy costs.

No agreements have been reached

about the proposed plant in Elko County.

Doug Hock, a Newmont spokesman at the

company’s Denver headquarters, said his

company would be “an anchor customer”

for the power plant.

The proposal has the strong support of

the City of Elko, largely because a major

new natural gas line would be built to fuel

the power plant.

“We’re always looking for diversification.

One of the roadblocks is energy,” said

City Manager Linda Ritter.

Newmont operates nine open-pit

mines, five underground mines and 15

processing plants in the state. Hock said

energy is the second-biggest cost

trailing only labor in its mining

operation.

And when energy costs skyrocketed in

early 2001, mining companies throughout

Nevada started looking for ways to trim

their consumption and reduce their costs.

“All of us got a wake-up call a year and a

half ago,” said Russ Fields, president of the

Nevada Mining Association. “The mining

industry is more mindful of electric power

in its operations than it ever has been.”

Fields said conservation efforts have

included steps such as wider use of variable-

speed motors and shifting of production

schedules to take advantage of lower

rates whenever that’s possible.

Some companies, he said, are looking at

possible co-generation projects to take

advantage of the heat generated by their

operations.

Others such as Newmont might take

advantage of state legislation from last year

that allows them to leave the Sierra Pacific

Power grid if they can show no harm

would result to existing customers. Mining

operations account for about 20 percent of

the electricity sold by Sierra Pacific Power.

The energy crunch doesn’t affect all

mining companies equally.

The heap-leach operations in Nevada

of Reno-based Glamis Gold, for instance,

have only modest amounts of power, said

Mike Steeves, the company’s vice president

for investor relations.

In 2001, he said, the company’s electric

costs for gold production amounted to about

$4.50 an ounce. In the first half of this year,

those costs have been about $7 an ounce.

Still, he said, the company looks for

every opportunity to cut its power usage

not merely for economic reasons, but

because its executives believe conservation

is the right thing to do.