BacTech moves from mining to bioremediation

Ontario, Canada-based BacTech Mining (TSXV:BM) is preparing to split its business in two later this summer.

The company developed a patented process to use bacteria to separate metals from sulphide ores—a process it used to mine gold in China and Australia during the past decade. But a growing demand for innovative ways to clean arsenic and other toxins from the tens of thousands of abandoned mines around the globe has now inspired the firm to use its bioleaching technology to clean up after other mining companies.

CEO Ross Orr said that the remediation business needed to be separated from mining in order to drum up investor support.

“One is digging a hole in the ground, one is filling it in,” Orr told the Cleantech Group. “The remediation thing really is our future.”

BacTech Gold, now a subsidiary, is expected to spinout as an entirely separate publicly traded company with its own management and directors, while the remediation operations will retain the current name. BacTech Gold is expected to pay a production royalty to BacTech to use its proprietary technology.

BacTech’s process, called bioleaching, uses about 66 types of bacteria to separate precious and base metals from sulphide ores and concentrates during the mining process. Typical mining practices—including smelting, roasting, and pressure oxidation—are capital intensive, but BacTech says its process is much less costly.

In abandoned mines, sulphides in the tailings can oxidize and trickle out of the mines in the form of acid mine drainage, polluting local water supplies with arsenic, selenium, bismuth and other toxins. BacTech’s remediation process uses those same bacteria to separate the toxins from the rock and remaining metal.

“We go in and take the nasties out of the tailings and leave behind harmless rock,” Orr said.

BacTech plans to enlist a mining company to partner on each project in order to make a concentrate from the abandoned mines. BacTech then plans to add that concentrate to a series of six stainless-steel tanks that are about 25 to 30 feet high and 20 feet across. Propellers inside would move the slurry around to keep the concentrate suspended so two or three strains of bacteria in each tank can consume only the sulphide, liberating the iron and arsenic, which join together to form ferric arsenate, a substance that is safe for landfills, Orr said. The company can also sell the leftover metal—such as silver, cobalt and nickel—for an additional revenue stream.

“These bacteria are doing this all the time in nature. We get them to do it all the time, 24/7 by giving them the environment they want to live in,” Orr said. “What they would normally do in 20 years, they do in five or six days because of the ideal conditions.”

BacTech isn’t the only company seeking to use bacteria for cleantech purposes. South Africa-based Gold Fields uses a similar process for gold mining but not remediation. Orr said the companies’ processes are similar, but BacTech uses higher temperatures.

And outside the mining sector, San Diego-based Genomatica genetically engineered E.Coli bacteria to consumer sugar and produce petroleum, which can be used to make plastics (see Genomatica develops novel bioplastic).

A team of scientists from four universities in India said in February they found a way to use bacteria to convert carbon dioxide emissions into calcium carbonate, a useful building material (see Indian scientists capture carbon with bacteria).

Researchers at the Massachusetts Institute of Technology are discovering chemical factories in bacteria that absorb carbon monoxide and carbon dioxide, and that have the potential to replace petroleum as a component of fuels, textiles, chemicals and plastic (see Is bacteria cleantech's miracle drug?).

Orr said the BacTech process is cost-efficient and modular, as capacity can be doubled by adding six more tanks. The process to clean an abandoned mine would likely take about 20 years, depending on size, with BacTech’s process.

The alternative?

“They treat the problem with a Band-Aid for 100 years, as opposed to solving the problem,” Orr said. He said many abandoned mines sit for years untouched as nature does the cleaning, while some companies treat the drainage to remove toxins.

BacTech is planning its first demonstration project for the bioremediation technology at the site of an abandoned silver mine in Cobalt, Canada. The company has applied for an C$8.5 million (US$7.5 million) grant from Sustainable Development Canada and a C$4 million grant from Innovations Ontario to allow it to clean the arsenic-laden tailings, as well as recover cobalt, silver and nickel to be sold to market.

Jointly the two grants would provide half the C$25 million cost of the first phase of the plant, capable of treating 200,000 metric tons (220,000 U.S. tons) of tailings, or 14,000 metric tons of concentrate, a year. At that rate, the mine could be cleaned in 15 years. BacTech first signed a memorandum of understanding with Gold Bullion Development but is now is seeking a different mining partner for the project that can contribute half the remaining cost.

A feasibility study is planned to begin in July, with construction expected to start in April 2010 and last three months. If the first six months of operation demonstrate an improvement in arsenic contamination, BacTech plans to add processing capacity to the facility to reach 1 million metric tons of tailings per year. The company has about 4 full-time employees but is planning to train workers through the nearby Haileybury School of Mines, a bacterial oxidation technician's course.

There are tens of thousands of abandoned mines across the globe, but the push to clean the mines has accelerated in recent years as the public has become increasingly aware of the potential environmental threats. Additionally, the economic crisis has depressed the cost of zinc and lead, prompting additional mining firms to abandon mines because they can’t make enough money.

Mining can be split into two types of ore: oxides and sulphides. BacTech’s technology applies to sulphide ores, which are harder to mine and clean, Orr said. Those mines include gold, silver, cobalt, nickel and copper. Potential markets for BacTech include Malaysia, the Phillipines, the U.S., Bulgaria, Romania, Armenia, Georgia, and Indonesia.

“We can go back and clean up what was done 80 years ago,” Orr said. “This is a classic case of technology catching up with demand.”