Search Documents

By J Ashford, Minniakhmetov

Geostatistical simulations are the best practice for uncertainty quantification in non-linear systems. Simulations are currently undertaken on an ad hoc basis in the mining industry due to high requirements in computing environments and advanced geostatistics. In contrast to the estimation process, multivariate simulations can be performed using different methods, tools, and computational environments, similar to data science. For large companies with multiple commodities it is important to have a standard framework to test, build, and run workflows using different methods, applications and computational environments. This work presents an auditable, modular and scalable framework to create geostatistical simulation workflows where the workflow is abstracted from the implementation. Key aspects: automation – workflows should be able to run automatically given updated data (if hands on modelling is not required); auditability – workflows should document key considerations and parameters; modularisation – workflows should permit swapping out components, for example substituting domaining in Leapfrog software with automated domaining using machine learning scripts; scalability – easy, repeatable, portable deployments on diverse infrastructure (for example, experimenting on a laptop, then moving to an on premise cluster or to the Cloud); reproducibility – parameters should be archived to permit re-running and reproduction of workflows in future years; and sensitivity analysis – any component of a workflow should be able to run with multiple scenarios of parameters and data to enable global uncertainty quantification and sensitivity analysis. The presented framework can be used to create different workflows for geostatistical simulations in multiple assets to quantify uncertainty in the value chain for resource categorisation, reserves uncertainty, value of information and robust mine planning amongst others.

Mar 22, 2022

By C Taylor, E Retz

Sequential Gaussian conditional simulation of wide-spaced exploration data has been completed in order to optimise a drilling grid at Fortescue’s Eliwana deposit. The aim of this drill grid is to improve the confidence in the Inferred Mineral Resource. A mineralised domain within the Joffre Member of the Brockman Iron Formation was selected to be tested as it makes up a large proportion of the Inferred Mineral Resource and is drilled at a reasonable spacing.One hundred realisations of Fe, SiO2 and Al2O3 grades were completed in the domain. Three realisations were selected for each analyte to represent the range of equiprobable values and a further realisation was selected to represent the truth data set. These realisations were used to flag theoretical drill holes on varying spacings and patterns. The theoretical drill holes were used to estimate into block models using ordinary kriging.These estimates were analysed and the accuracy and precision of each drill spacing was assessed. It was concluded that the greatest improvement in estimation results was noted at either a 100 m × 50 m or 50 m × 50 m spacing.CITATION:Taylor, C and Retz, E, 2015. How much do we need to drill?, in Proceedings Iron Ore 2015, pp 491–500 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 13, 2015

By L O’Connor, S C. Dominy

"Geometallurgy is an important addition to any evaluation project or mining operation. As a discipline, it seeks to maximise the net present value (NPV) of an orebody while minimising technical and operational risk. It also aims to promote sustainable development and initiatives by ensuring that all stages of extraction are performed in an optimal manner from a technical, environmental and social perspective. To achieve these goals, development of innovative technologies and approaches along the entire commodity value chain are being established (Glass, 2016). Geometallurgy has been shown to increase operational stakeholder collaboration, creating an environment for knowledge sharing and improved data acquisition and interrogation, with the end result being the integration of such data into mine planning and scheduling. All of these aspects create better business optimisation, utilisation of staff and targeted and realistic key performance indicators.The mining industry faces numerous challenges including, but not limited to:declining ore gradesgeometrically and/or internally more complex depositsdeep-seated deposits, with potentially high in situ stress regimesincreasing quantities of mine waste that needs to be managed appropriatelyhigher energy, water and chemical costsprocessing of more challenging and refractory ores – textural complexitiesstricter environmental/permitting conditions – so-called ‘licence to mine’increasing demand for specialist metals (eg rare earth elements, In, Ge, Te, Rh, Se, Ga and Li)commodity market volatilitya difficult funding environment.Given these challenges, geometallurgy provides the opportunity to control or at least manage some of them.CITATION:Dominy, S C and O’Connor, L, 2016. Geometallurgy – Beyond Conception, in Proceedings The Third AusIMM International Geometallurgy Conference (GeoMet) 2016, pp 3–10 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Jun 15, 2016

By S Gulati, N Sarkar, T Vink, S Battersby, L Okada

This paper examines a successful project implemented by BHP Mitsubishi Alliance (BMA) and the Polymathian team at Deswik, aimed at enhancing short-term scheduling processes to reduce vessel turn times in the BMA Central Queensland coal value chain. The project’s objective was to digitalise the planning process to enable planners to make data-driven insights to improve the profitability of the value chain. The strategy involved developing a digital mining system that incorporates data storage, cloud computing, and the ability to meet the integration needs of both internal and external business systems. This was complemented by a sophisticated, optimisation-based, decision-support tool to enhance the planning teams’ ability to make timely and effective decisions.

Sep 1, 2024

By D J. Bradshaw, B Lottermoser, A Parbhakar-Fox

"Best practice for acid rock drainage (ARD) risk assessment still relies solely on the geochemical properties of sulfidic rocks and mineral processing products, despite the fact that a rockÆs tendency to produce acid also depends on mineralogy and texture. Consequently, there are a plethora of geochemical tests routinely utilised by the mining industry to predict ARD formation. Due to limitations associated with these tests and their relatively high costs, analysis of recommended best practice sample numbers is rarely achieved, reducing the accuracy of waste management plans. Our research addressed this through examining the application of geometallurgical data for predicting acid formation, and led to the identification of potential environmental geometallurgy indicators.Samples obtained from an iron-oxide copper gold deposit were subjected to the geochemistry-mineralogy-texture (GMT) approach, an improved methodology for classifying acid forming potential. GMT results were compared against geometallurgical and assay data sets to evaluate: relative carbonate content measurements (measured by HyLogger) and identify how these could be used to calculate effective acid neutralising capacity mineral hardness (measured by EQUOtip) to determine application of this data for calculating lag-time to acid formation opportunities to automate the acid rock drainage index (ARDI) using classified images produced by a GEOTEK logger and automated microscopy.Links between the GMT approach and geometallurgical data sets were identified. Classified mineralogy data has application at stage one, HyLogger and EQUOtip at stage two and computer-based ARDI evaluations of classified images at stage three. Through such integration, ARD characterisation costs can be reduced, with value added to geometallurgical data sets. Furthermore, deposit-wide ARD domaining is possible, and acquisition of total-orebody knowledge more likely. Through adoption of this environmental geometallurgy approach, a better informed waste management plan can be formulated, allowing for best practice ARD sampling in a more cost-effective manner.CITATION:Parbhakar-Fox, A, Lottermoser, B and Bradshaw, D J, 2013. Cost-effective means for identifying acid rock drainage risks - integration of the geochemistry-mineralogy-texture approach and geometallurgical techniques, in Proceedings The Second AusIMM International Geometallurgy Conference (GeoMet) 2013, pp 143-154 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Sep 29, 2013

By W M. Tekano, T S. Coulter, N M. Hutt

The Vancouver Island Highway Project (VIHP) was a $CAD 1.2 billion expenditure by the Province of British Columbia to improve travel safety and relieve traffic congestion between Victoria and Campbell River on Vancouver Island. In the section of highway between the Tsolum River and Oyster River, on the Inland Island Highway portion of the VIHP, over half of the rock to be cut and filled was found to be net acid generating. The Tsolum River has been impacted by metal leaching and acid rock drainage (ML/ARD) for decades from an upstream closed minesite. Geochemical testwork indicated: over half of the rock along this section of highway was potentially net acid generating based on a site-specific SNPR (=NP/SAP) criterion of 1.5; some core samples were already acidic; pyrite occurred in disseminated framboidal and gel forms; the rate of acid generation was not high; measured neutralisation potential (NP) provided some lag time for the onset of net acidity; and non-carbonate neutralising minerals prevented low pH (These predictions led to ML/ARD controls involving: realignment of the highway; elevation control to minimise the volume of disturbed rock; encapsulation of blasted-rock fills within the highway, surrounded by low-permeability till and covered with asphalt; and diversion of water away from cut faces. Internal pipes drained any water reaching the fills into external ditches and ponds, where the water could be monitored and, if necessary, treated. Water from the cuts was also captured in ditches and carried to monitored ponds. Elevated aqueous sulfate concentrations in several ponds confirmed that sulfide minerals were oxidising, but the lack of both acidic pH and increasing trends in concentrations demonstrated that ML/ARD was controlled. Contingency plans for any pond that may become acidic include water treatment, which predictive testwork has shown would not require substantial amounts of limestone or lime.

Jan 1, 2003

By T Craske, J Sykes, T C. McCuaig, M Jessell, A Trench

The prevalent strategic approach in the mining industry is one of planning. However, it is widely recognised that planning does not work in complex and uncertain situations (Mintzberg, 1994), such as those associated with ‘above ground’ non-technical orebody complexity (Trench, Packey and Sykes, 2014). Mintzberg, Ahlstrand and Lampel (2009) suggest the focus instead should be on strategic ‘thinking and doing’ and using the many ways to think about strategy to make sense of complex, uncertain, and unique situations. They therefore place great value in cognitive flexibility. Scenarios development utilizes several different thinking styles and thus assists with this type of flexible strategic thinking (Figure 1). The ‘Centre for Exploration Targeting (CET) Scenarios’ were developed with the ‘Oxford Scenario Planning Approach’ (OSPA) (Ramírez and Wilkinson, 2016). The OSPA aims more to improve the thinking skills of decision makers, rather than forecasting per se (Wack, 1985a, 1985b). As such, this paper focuses less on the content of the scenarios and instead on the practical value of scenarios in strategizing. CITATION: Sykes, J, Trench, A, McCuaig, T C, Jessell, M and Craske, T, 2018. Strategic thinking about long-term ‘above ground’ orebody complexity using scenarios, in Proceedings Complex Orebodies Conference 2018, pp 60–64 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Nov 21, 2018

By B P. Wrench, M J. Gowan, P J. Chapman

Embankment dams constructed mainly of sand or non-plastic fine soils are susceptible to liquefaction, particularly in high-rainfall, high-seismicity environments where there is sufficient water to saturate the materials and sufficient energy from an earthquake to cause liquefaction. This paper shows the process adopted to review the stability of an existing cross-valley, centreline-raised cyclone tailings sand embankment dam.The study showed that two-dimensional stability analyses did not sufficiently capture the potential for instability, overestimating the depth of the critical failure surface. Instead, three-dimensional modelling was required to provide a reasonable representation. Post-liquefaction stability analyses carried out using the three-dimensional model indicated an adequate factor of safety (FoS). The FoS under seismic conditions was still considered to be a concern based on pseudostatic analyses (but noting the limitations of the analysis method).Earthquake-induced settlements were estimated using an empirical approach based on case history records (Swaisgood, 2003). The post-earthquake event settlement was estimated to be in the order of 600 mm, which is considered to be acceptable for the embankment, taking account of the proposed long-term freeboard of more than 8 m under operating conditions and 2 m under the probable maximum flood condition.CITATION:Chapman, P J, Wrench, B P and Gowan, M J, 2015. Review of static and seismic stability of a cross-valley sand tailings embankment in a high-rainfall, high-seismicity setting, in Proceedings Tailings and Mine Waste Management for the 21st Century , pp 163–172 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 27, 2015

Many young mining engineers do not consider consulting as a possible job, believing that many years of working on-site is required to achieve practical experience, develop expertise and acquire industry contacts. However, mining consultancies employ engineers with varying levels of experience, including part-time university students, graduates and engineers who are relatively new to the industry. This paper outlines the role of a young engineer in a large mining consultancy and the benefits to both the consultancy and the client of having a mix of consultants with a diverse range of experience. From the authorÆs perspective, the work experience, lifestyle and rewards of mine consulting are compared to site based work, including a discussion on whether consulting is able to offer the professional development that a young engineer needs.

Jan 1, 2009

As Project Managers for the Blair Athol Coal Mine Project, CMPS selected a number of computer systems to assist in project control. The areas where computers were used were: 1) Planning & Scheduling 2) Procurement Reporting 3) Document Control 4) Accounting 5) Cost Control 6) Control of project management and engineering manhours The computer packages selected were generally effective in their own areas. During 1982, CMPS acquired an in-house project control package called GC/Cue. Project control systems for the project are progressively being set up on this system. The advantages of this type of system are: 1) Improved accessibility of information, due to on-line operation and the use of VDU's. 2) Improved turn around time for computer runs and production of reports. 3) Improved presentation and format of reports. 4) Lower costs.

Jan 1, 1983

By K Tanguturi, B Belle, R Balusu

Management of high rates of goaf gas emissions between 4000 and 6000 L/s of methane gas in longwall panels is a challenging issue, particularly in start-up areas of the panels. There is a need for investigation of the effect of various goaf gas drainage concepts and techniques, and development of effective gas drainage strategies for management of high goaf gas emissions in start-up areas of the longwall panels. This paper presents the results of various computational fluid dynamics (CFD) simulations that were carried out to investigate the effect of different goaf gas drainage strategies and combinations for gas management in the start-up area of the longwall panels. Results indicated that the gas (methane) concentration in goaf holes on the tailgate (TG) side vary between 50 and 75 per cent under the simulated field conditions with flat coal seam gradients. The results also indicated that operation of more goaf holes for draining the goaf gas on the TG side results in high ingress of oxygen and further reduction in gas concentration in goaf gas drainage holes. The simulations also included scenarios with goaf gas drainage holes on the maingate (MG) side, TG cut-through seal and near the start-up area. This paper presents the results of various goaf gas drainage strategies and discusses the effect of various combinations in order to develop effective goaf gas drainage strategies for gas management in start-up areas of the longwall panels.CITATION:Tanguturi, K, Balusu, R and Belle, B, 2015. Development of goaf gas drainage strategies for start-up areas of highly gassy longwall panels, in Proceedings The Australian Mine Ventilation Conference, pp 251–258 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Aug 31, 2015

By M Akop, G Phillips, L Elliott

An estimation geologist has many tools in their kit and using the correct one for the job is vital for creating a useful model. Reconciliation is a key step to monitor the performance of a resource model and to ensure the correct tools have been selected and appropriate parameters are set. This paper presents an example of refining the estimation methodology for a Channel Iron Deposit (CID), resulting in an improved model. Rio Tinto Iron Ore (RTIO) CIDs are unique iron ore deposits located in the Pilbara region of Western Australia and contribute a significant volume to the world’s seaborne iron ore market. A problematic feature of these deposits is the irregular dispersion of clay pods that cannot be delineated with confidence within the resolution of the exploration drilling. Resource to grade control reconciliation showed an over-prediction of high-grade material in the resource model. A fresh approach was required to improve grade and tonnage predictions. Historically, clay pods were delineated using traditional wireframing techniques and estimated using ordinary kriging with hard boundaries. The new method utilised indicator kriging to estimate the probability of clay. Probabilities generated from the indicator kriging estimate were used as an additional weighting following the ordinary kriging of grades. Results showed indicator kriging improved global high-grade tonnes reconciliation, however, as expected, it did not improve the spatial prediction of clay. Based on improved reconciliation results indicator kriging has now been adopted as a suitable alternative for analogous CIDs at RTIO. These improvements benefit the mine planning process, but do not replace grade control models.

Mar 22, 2022

By M Rimes

This paper describes a technique to predict achievable head grades and likely variances from target grade for the Shovelanna Iron Ore Project, in the Pilbara region of Western Australia. The block model from which the production schedule is produced was created from a wide spaced drilling program and was classified as an Inferred Resource under the JORC Code. Ideally, production schedules and target grades would be determined using a combination of Proved and Probable reserves. However sometimes it is necessary to consider the requirements of potential off-take parties who have specific grade tolerances. A technique is needed to simulate mining sequences and grade variations early in the planning process, using an æexplorationÆ block model rather than the normal æminingÆ block model. Marketing contracts require examination whether the target grade {Fe, P, SiO2, Al2O3 can be kept constant, or must be revised during the life of the mine. A model (written in ExcelÖ using Visual Basic macros) develops a feasible, close to optimal, mine plan from block model data. Cut-off grades for minable ore are chosen. The model evaluates ore tonnage, grade and stripping ratio against depth. Outputs at this stage include plots of slices through the orebody, at nominated x, y and z coordinates, showing ore grade, waste, drill hole locations and topography. The model then searches for a feasible satisfactory mine plan. The initial grade target is the average for the identified ore blocks. The available block list (ABL) at any time is the set of ore blocks, any one of which can be mined without removing any other ore block. The entire initial ABL has an unacceptably large ætotal grade stressÆ, defined as [(Grade-Target)/Tolerance]2, summed over the four relevant minerals {Fe, P, SiO2, Al2O3}. The model trims the ABL, removing the block most harming the total stress. Trimming is repeated until the total grade stress reduces to an acceptable level. The trimmed ABL defines the first mine campaign. Removing the trimmed block set, a second ABL is exposed, which is again trimmed and mined. The process is automatic: a few seconds computation provides a complete mine plan. Re-running the model with adjusted grade limits quickly shows whether a uniform target can be achieved or whether the target must be modified during the mine life.

Jan 1, 2007

By A Innis, A Bye, B McCarthy, S Glover

Technology adoption in the mining industry has been steadily increasing over the past decade, driven by the need to improve operational efficiency, safety, sustainability, and profitability. As mining companies wish to implement solutions to improve mining safety and productivity, various technologies are being integrated into mining operations to enhance processes, reduce risks, and optimise resource utilisation. Adoption of new technologies such as autonomous trucks requires a strong focus on foundational operational technology (OT) and a systems-thinking approach. OT support is critical however, OT is traditionally not considered or integrated into standard maintenance activities. Consequently, sourcing and applying service support to OT systems in real-time has posed significant challenges to date. Neglecting the monitoring and upkeep of these operational technologies and equipment can lead to a host of adverse consequences. Operating instability becomes more prevalent, necessitating reactive measures, and the vulnerability to cybersecurity threats increases significantly. To address OT monitoring and maintenance challenges, a systems wide mindset and remote support discipline must be utilised. Remote operations support refers to real-time, 24/7 monitoring, control and support of site OT: network, production systems, maintenance systems, enterprise systems and mobile and fixed plant through a single interface remote from site. The presence of a disciplined team, grounded in a systems-oriented approach, is of the utmost importance to remote monitoring, given the intricate interdependencies of OT systems. The ability to understand the relationships among multiple systems, coupled with the capacity to distinguish between symptoms and root causes, assumes a pivotal role in operations. Through diligent monitoring and the astute understanding of system thresholds, remote operations support can actively identify and alleviate constraints, in turn, serving as the enabler for transformative advancements in technology output.

Sep 1, 2024

By T Honeyands

At present we are witnessing large investments in the iron ore industry, fuelled by demand from Asia. At the same time, there is a changing landscape in pricing of iron ores, with the recent demise of the benchmark system and the evolution of market based index pricing systems. From a customer perspective, it is the behaviour of iron ores in downstream processing that gives them their value; their impact on the sintering or pelletising process and subsequently blast furnace ironmaking. It is therefore important to consider this value when developing projects, making mine planning/cut-off grade decisions, and in setting quality price differentials.This paper describes the use of the Marx value in use (VIU) model to quantify the downstream value of iron ores. The Marx model consists of heat and mass balance modules for sintering, pelletising and a rigorous two-stage heat and mass balance model of blast furnace ironmaking. Mass balance and cost models are applied for steelmaking, casting and rolling. The use of a heat and mass balance allows accurate comparison of the impact of raw material properties on blast furnace operation. The impact of minor elements, such as alumina, silica and phosphorus, and metallurgical properties on ironmaking is described, and examples given for the relative value of haematite, Marra Mamba, and channel iron deposit (CID) ores.

Jul 11, 2011

By R Saha, D Barry, C Mawdesley, O Bertoli

Kriged estimates are not typically calculated on blocks substantially smaller than the sample spacing (eg the Standard Mining Unit or SMU). Moreover, the sample spacing for quality variables is often much greater than the SMU size. For short to medium term planning decisions, the shorter term variability in the quality variables is a key economic consideration in defining, setting and meeting coal product specifications.Global uncertainties can be calculated using Drill Hole Spacing Analyses (DHSA). However, knowing the precision of a variable for a one or two year production volume is usually not adequate for variables with low spatial continuity that may fluctuate significantly over daily, weekly, SMU, or shipment volumes.Is there a feasible, reasonable and valid geostatistical method to model the uncertainty of coal quality variables on blocks substantially smaller than the drill spacing (say on the SMU)?The validity of using co-kriging variances, calculated on SMUs to characterise local uncertainty, was tested using a suite of conditional simulations generated for several quality variables for BHP’s Blackwater operation. The conditional simulation results were used as a benchmark against which the results derived from the kriging variances could be compared.The agreement between the kriging and simulation methods for thickness is excellent, with much closer correlations than for the quality variables. Typically, the kriging variances give very reasonable approximations to the simulation-based uncertainties, although there could be some systematic discrepancies which may become much more critical if a classification is to be based on a thresholding of the SMUs relative uncertainties.CITATION:Mawdesley, C, Barry, D, Bertoli, O and Saha, R, 2017. Local uncertainty benchmarking – a coal case study, in Proceedings Tenth International Mining Geology Conference 2017, pp 43–50 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Sep 20, 2017

By P Mikula, B Darlington, J Graham, P Young

In underground mines experiencing dynamic events, there is an ever-present challenge to design and maintain a capable ground support system. One key component of ground support systems is surface support, which serves the essential roles of retaining failed rock and transferring forces generated by surface displacement to rock bolts or other support elements. Observations underground show that in many instances, standard mesh panels alone do not provide sufficient dynamic support to retain substantial bulking failures imposing displacement onto mesh, and in such cases Mesh straps and W-straps may be employed. Determining the performance of surface support elements proves to be difficult, with a multitude of variables at play in the underground environment. Quite comprehensive work has been completed on laboratory testing of surface support systems; however, very little work has been conducted on in situ dynamic testing of Mesh straps and W-straps. In 2019 in Western Area’s Flying Fox Mine, in situ dynamic testing was conducted on a series of Mesh straps and W-straps using Sandvik’s in situ Dynamic Test Rig (DTR). The testing regime applied impact energies from 5.1 to 15.3 kJ to Mesh straps and W-straps. The performance of the straps that did not fail was a maximum absorbed energy of 9.3 kJ and 14.2 kJ for the Mesh straps and W-straps respectively. The testing successfully demonstrated the ability of Sandvik’s DTR to test not only rock bolts, but also surface support elements, creating new testing and research possibilities. The testing also provided important design guidance data that is not practicable to obtain using laboratory dynamic testing facilities.

Nov 29, 2022

By J Rutter, S Dunham

Technological advances in sensor and material handling technology has enabled a step change in mine operations performance. Sensors capable of monitoring the grade of broken rock mass can be mounted on shovels, truck loading units or conveyors allowing highly precise ore/waste decisions to be made on small parcels of rock, increasing selectivity. This increased selectivity has the potential to remove sub-economic material from the product stream prior to incurring ore treatment costs. Bulk ore sorting is capable of intervening at <10t “pods” on Run Of Mine conveyors, or alternatively at per bucket loading (5-100t) or truck scale (30-350t) parcels of ore. This Grade Engineering technique being developed by CRCORE (Rutter, 2017) can improve mill feed grade, remove deleterious materials and ensure that the high capital intensity ore treatment facility is presented with the best ore feed strategy. While this technology can improve mine economics, estimating the performance of a bulk ore sorting system is challenging. Traditional resource estimation practices such as Ordinary Kriging and Inverse distance weighting (IDW) are based on weighted averages, a process that smooths the grade profile, reducing modelled variance and dispersion. Its purpose is to generate a globally unbiased result but is less suited to generating a model of adequate granularity to enable confidence in local grade heterogeneity. This is an essential component for bulk ore sorting success. Estimating ore sorting performance requires knowledge of the grade-tonnage curve at the scale of the sensor diversion unit (SDU). Evaluation based on an estimator that smooths the SDU distribution will not correctly predict ore/waste separation or economic performance. Alternatives to traditional linear geostatistics have been tested on a variety of mineralisation styles. Additionally, a number of heterogeneity metrics have been developed to assist with evaluation and assessment. The difference between estimation for grade (metal) and modelling for traditional mining block models, versus methods used for predicting heterogeneity and variability are explored.

Nov 10, 2020

"Cash flow modelling during project evaluation is enhanced when probabilistic methods are applied to the inputs. One of the important inputs is the quarterly production profile. Typically, the steady-state production profile provided to project evaluation practitioners is deterministic, with each quarter the same as every other quarter. This is unrealistic as actual production profiles from existing mines exhibit a range or quarter-on-quarter variance. Monte Carlo stochastic simulation of the production profile can be used to provide a range of possible outcomes, but how are these ranges selected? This paper describes the use of quarterly production variance from a large database of mines worldwide as a benchmark to inform the appropriate selection of ranges. The coefficient of variation is used to rank the production from mines, with quartile analysis applied to indicate industry best, median and worst variation. Due diligence of existing mines and evaluation of future production performance can be quantitatively assessed using this approach. Examples of the effect on value are provided.CITATION:Stewart, C A, 2016. Production variance benchmarks and their use in project evaluation and due diligence, in Proceedings Project Evaluation 2016, pp 201–213 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Mar 8, 2016

By E Holloway

The optimisation of an open pit mine can be broadly split into two stages, the first being the ultimate pit optimisation (and subsequent stage designs), and the second being schedule optimisation. Macroeconomic uncertainty clearly impacts on both however interrelationships do also exist. Generally, the opportunity exists for the ultimate pit to be revised during each planning cycle, however when this reprieve is removed the uncertainty for the underlying business increases. As one example, the introduction of an in-pit waste dump can be seen to significantly limit the option to revise the ultimate pit. When in this situation there are two potential risks that present: (i) the long-term price used for the ultimate pit selection is optimistic, and too large of a pit is selected resulting in waste being mined which uncovers material not of a significant value to deliver a profit; (ii) the long-term price used for the ultimate pit selection is pessimistic, too small of an ultimate pit is selected, and ore of realisable economic value left behind. Both of these outcomes are risks and as such can be assessed and quantified. CITATION: Holloway, E, 2018. Incorporating economic variability into a strategic planning framework, in Proceedings Complex Orebodies Conference 2018, pp 88–90 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Nov 21, 2018