Major malfunction has hit BHP Billiton's Olympic Dam
08/10/2009 - BHP Billiton Ltd and the South Australian government are investigating a major malfunction of the automatic ore haulage system at the mining giant's Olympic Dam operation.
BHP Billiton was unable to say whether the incident would harm production at Olympic Dam, which is a major producer of copper, uranium and other metals.
Nobody was injured when the automatic haulage system, which carries ore from underground to surface processing facilities, collapsed at (2300 AEDT) on Tuesday.
A secondary haulage system continues to operate at the mine.
"The safety of our workforce will take priority in determining any restart of haulage operations," BHP Billiton said on Wednesday.
In 2008/09 Olympic Dam produced about 194,000 tonnes of copper cathode, 4,000 tonnes of uranium oxide, 108,000 ounces of gold and 938,000 ounces of silver.
Commentators on Wednesday were cautious about whether the incident at the mine, which produces between eight and nine per cent of the mined uranium globally, could affect the commodity's price.
"It will have an impact on ore production, therefore copper and uranium production," RBS Morgans resources analyst Warren Edney said.
"It is possible it could affect uranium prices," Edney said.
"It (Olympic Dam) represents about one per cent of global copper production on an annual basis, I don't think it will have an impact on the copper price," Edney said.
A spokesman for SafeWork SA said the organisation was sending investigators to the site to examine the haulage failure.
"The haulage system of ore to the surface has had a major malfunction apparently and (caused) fairly substantial damage as it has collapsed," he said.
"Where serious damage has occurred it is notifiable, so the company contacted us as they should."
BHP Billiton said the company was making a full investigation into the incident to determine the cause of the failure and extent of the damage.
In its recent annual report, BHP Billiton chairman Don Argus described the company's safety record in 2008/09 as "unacceptable" after seven workers died on-site.
There has also been two workplace fatalities at Olympic Dam in the past.
In December 2007 a 35-year-old contractor died when a piece of fibreglass fell on him, while in 2005 a 34-year-old man employed by Western Mining Corporation at the site perished after explosives were prematurely detonated.
A proposed expansion at the mine, estimated by analysts to cost about $15.9 billion, would see Olympic Dam become the world's largest producer of uranium, and one of the largest producers of copper.
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