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By A R. Bye

The mining industry is facing some key challenges that provide a compelling case for geometallurgy initiatives. Over the last 30 years, the average grade of Australian orebodies being mined has halved while the waste removed to access the minerals has more than doubled. In the last eight years, the industry’s energy consumption has increased 70 per cent while multi-factored productivity has fallen 24 per cent. The paper documents a broad range of industry case studies which demonstrate strategies for gaining value from geometallurgy.The mining industry constantly faces the key questions of how significant ore variability is on mine valuation and how would knowledge of the variability change the mining schedule, mine to mill design and operation. Using case studies the paper describes the methods used for incorporating mineral extraction attributes into orebody models and their technical integration into daily operation as well as mine planning optimisation. While pit optimisation from a fully attributed geometallurgical model highlights areas of opportunity and risk it is shown that during the scheduling phase of mine planning that significant value can be added. The benefits from these projects included reducing geotechnical and environmental risk, improving mine to mill performance, option analysis and quantified cash flow risk. There is growing acceptance within the minerals industry that ‘realistically assumed modifying factors’ defined by a competent person/s are not sufficient to mitigate the risk of funding mining ventures. Geometallurgy is moving away from factored ore reserves to data-rich block models providing reliable information for mining, metallurgical and environmental considerations.

Sep 5, 2011

By L Q. Amorim

The mining district of the Quadrilátero Ferrífero (QF) in southeastern Brazil contributes to 70 per cent of the Brazilian iron ore production, which reached 370 Mt in 2010. Traditionally, four iron ore types were mined in the QF region:1. soft haematite,2. hard haematite,3. friable ‘itabirite’ (the Brazilian name for metamorphosed banded iron formation), and4. canga (an indurated iron-rich crust).With the exception of the hard haematite, these categories derive from supergene enrichment of the Paleoproterozoic Cauê Itabirite. High current iron ore demand means that the QF high grade supergene ores will be depleted in a few decades. Consequently, several mining projects are being developed to exploit unenriched, fresh itabirite. Among them, the Mineração Usiminas Serra Azul project in northwestern QF is one of the most advanced. Four major itabirite types occur in the QF region:1. siliceous (or standard),2. dolomitic,3. amphibolitic, and4. magnetitic.The dominant type in Serra Azul region is a fresh siliceous itabirite, composed essentially of haematite, martite and quartz that averages 36 per cent Fe (51.5 per cent Fe2O3) and 47 per cent SiO2. The second type, the magnetitic itabirite, consisting of magnetite, martite, gruneritecummingtonite, quartz, dolomite, stilpnomelane, and subordinate haematite, is typically a strongly magnetic greenish banded iron formation with the iron grade varying between 25 and 35 per cent. Chemically, it differs from the siliceous itabirite due to the relatively high CaO, MgO and, consequently, high LOI contents. Together with supergene ores, fresh itabirites have been included in the ore reserves of the Serra Azul project. We anticipate that all the four types of fresh itabirite will be incorporated as ore in the QF region, causing a huge increase on the iron ore resources of the district, and representing enormous environmental and technological challenges for the local iron ore industry.

Jul 11, 2011

By F Rashidinejad

Iran has had an active mining sector for some 7000 years. Exceptional in terms of its mineral diversity, Iran produces 62 minerals, and is ranked among the world’s 15 most mineral-rich countries. Many people around the world know Iran as one of the major petroleum exporters. Oil and natural gas dominate Iran’s economy, and oil exports provide the principal source of income, contributing more than 80 per cent of foreign exchange earnings. Transformation of Iran from an oil exporter to an independent country to oil has been on the table for many years, even before the Islamic Revolution of 1979. Development of the Iran’s mineral industry is one of the major replacements for petroleum exports. In the last decade, Iran invested billion dollars in the mining and mineral industry sectors and to increase the added value, tried to export processed minerals instead of the raw materials. In accordance with the ‘20-year Perspective 2025’ that targeted by the Supreme Leader, Iran will be a country with the first rank in economy, science and technology in its region. The objectives over this perspective include briefly increasing annual production to 55 Mt of crude steel, 800 000 tonne of copper cathode, 1.5 Mt of aluminium, 200 Mt mineral products, 300 000 tonne of zinc and 5 000 kg of gold. These goals are achievable in normal circumstances, but concurrency of the 20-year Perspective 2025 with commencement of the UN Security Council sanctions against Iran, frustrated objectives of the perspective, at least the ones related to the mining and mineral industry sectors. This paper tries to elaborate the development programs and following challenges for the mining activities of Iran by 2025.

Nov 22, 2011

By T Ma, F T. Suorineni, Q He, J Oh

Directional hydraulic fracturing was invented by Polish experts and was first applied in coal mining to prevent hard roof rock bursts. Based on its successful application in coal mining, directional hydraulic fracturing has the potential to reorientate the hydraulic fracture trajectory. Recently, this technique has been introduced into cave mining for the purpose of lowering breakdown pressure. The hydraulic fracture is much easier to initiate with the assistance of an initial notch. No systematic theoretical or experimental studies have been carried out to investigate the influencing factors in the hydraulic fracture reorientation process. In this paper, the numerical modelling software Realistic Failure Process Analysis3D (RFPA3D) – Flow Version is used to study the influence of the in situ stress condition and rock mass heterogeneity on directional hydraulic fracturing in brittle heterogeneous rock masses. Firstly, the reliability of RFPA3D in simulating hydraulic fracturing is validated by comparing its results with experimental results and the simulation results from the extended finite element method. The hydraulic fracture trajectory is then observed in a three-dimensional stress environment. The results indicate that for the in situ stress condition, when the borehole lies in the ?2–?3 plane, only the difference between ?2 and ?3 has an important influence on hydraulic fracture reorientation. Furthermore, rock mass heterogeneity is a key factor that must be accounted for when fracture reorientation is required.CITATION:He, Q, Suorineni, F T, Ma, T and Oh, J, 2016. Modelling directional hydraulic fractures in heterogeneous rock masses, in Proceedings Seventh International Conference and Exhibition on Mass Mining (MassMin 2016), pp 369–384 (The Australasian Institute of Mining and Metallurgy: Melbourne).

May 9, 2016

Addressing community concerns in relation to an economic activity, particularly when it causes significant community impacts, is especially important for the development of extractive industry projects. Pipelines comprise an integral part of many hydrocarbon developments, which may cause different effects on local economic development, communities and the environment compared with open cast mines. This paper explores community impacts associated with a case study of the oil pipeline æEastern Siberia-Pacific OceanÆ in the Republic of Sakha (Yakutia), Russia. Based on semi-structured interviews, conducted in 2006 - 2008 in Russia, the paper investigates claims of local communities about potential impacts of the pipeline development of their environments and economic activities as well as community claims for greater involvement in sharing the benefits from this major infrastructure project. A community of Indigenous people, Evenk, is likely to be most profoundly affected by the development due to impacts on their traditional activities such as hunting and reindeer herding. The paper examines in detail the regional economic, social, environmental and Indigenous peoples concerns over the construction of the oil pipeline and investigates actions and methods adopted by community organisations to voice their concerns about the pipeline development. Finally, the paper assesses the process of interaction between the pipeline developers and regional stakeholders.

Jan 1, 2009

By S R. Williams

There is a sense of geometallurgy being new; a new methodology for mining project development and improved operational strategy. One of the main challenges that any ænewÆ technology faces is a validation of the value and the need to produce case studies. However, producing case studies can often be problematic particularly given the long cycle from mineral deposit project, through feasibility and construction to stabilised operation of a mine.However, the roots of geometallurgy go back quite some time. Successful practices with geometallurgy can be seen from as early as the 1980s. Many times those practices were not called geometallurgy but something else and, in other cases, what can be seen are various components of the geometallurgical ævalue chainÆ.This paper will analyse a selection of published past practices from a geometallurgical perspective to demonstrate the value realised from the application of this methodology. The paper will then make some general comments on where this history of work in geometallurgy has lead us to and what are the challenges today for the geometallurgical effort.CITATION:S R Williams, 2013. A historical perspective of the application and success of geometallurgical methodologies, in Proceedings The Second AusIMM International Geometallurgy Conference (GeoMet) 2013 , pp 37-48 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Sep 29, 2013

By Dodd SF

Valuation of mining companies and their underlying assets prepared by brokers' analysts are, by necessity, approximations. The reliability of the valuations is entirely proportional to the quality of available data, the reliability of forecasts and the nature of underlying commodity price assumptions. The latter is perhaps the greatest single cause of gross variations in company and asset earnings estimates and- valuations. Assumptions are often necessary regarding commodity price achievement based on commodity hedge positions. Public disclosure from listed companies provides a sound base from which to project earnings, cashflows and balance sheets. The uncommon disclosure of projected production and cost schedules often reduces the reliability of future estimates. The application of reserve and resource estimates is contentious with practitioners applying differing weightings to importance of resources in estimating mine lives (and therefore cashflow streams). Valuation methods applied in equity markets usually focus on relative value and the identification of pricing anomalies. The commonest ""rules of thumb"" applied in the valuation of mining companies (and therefore their underlying assets) is with the use of year specific price/earnings (P/E) and price/cashflow (P/CF) ratios, with low multiples suggesting undervalued assets, high multiples overvalued situations (but these rules can often be clouded by market expectations of underlying commodity price movements). Another simply applied valuation tool is to examine the examine the value placed on reserves and resources by the market. Inexpensive gold in the ground (expressed as $ of market capitalisation per ounce of reserves or resources) might indicate a buying opportunity, but the market does discount the value of gold in the ground prior to mine development and where development risk is perceived.

Jan 1, 1994

By J OÆDriscoll, R Butler, L Winter

The iron ore mining district of Labrador West and adjacent Quebec is Canada's largest iron ore producer with almost 50 years of production. The area is currently experiencing a period of renewed activity not seen in decades that includes new mine development, mine expansion and exploration for new iron ore resources. All of the past and present production and exploration programs in the district are centred on the Lower Proterozoic Superior-type iron formations of the Knob Lake Group, located within the Grenville tectonic province of the Canadian Shield. The Knob Lake Group is a continental margin sedimentary sequence which was deformed and subjected to greenschist to upper amphibolite facies metamorphism during the Grenville orogeny. Regional deformation and metamorphism plays a key role in making the iron formation of the Knob Lake Group economic. The distribution of orebodies in the district is controlled by superimposed F1/F2 synclines which causes thickening of the iron formation through repetition. Ore mineralogy consists of specular haematite, magnetite and locally martite with quartz as the major gangue mineral. Regional metamorphism has caused an increase in grain size of the ore minerals making it more amenable to concentrating and pelletising. Altius has been active in Labrador West since 2003 and is now the second largest licence holder in the district with several iron ore exploration projects. The Kamistiatusset project is located in the heart of the region's transportation, power and mining infrastructure. The property has seen limited previous exploration, but covers several significant iron ore prospects. Work by Altius includes a helicopter-borne magnetic survey, ground magnetic and gravity surveys, geological mapping, sampling and 6000 m of diamond core drilling all of which confirm both a favourable geologic setting and ore mineralogy.

Jan 1, 2009

By H Utama, hi, A Suw

PT. Indo Muro Kencana (PT.IMK) is gold and silver mine located in Central Kalimantan province, Indonesia. Mining activities in PT.IMK is conducted in Bantian pit area by applying surface mining method and using combination of excavator and hauler (articulated dump truck and rigid haul truck) as the transportation for ore to the crushing plant and waste material to the waste dump. Current blasting practice is ore-waste blasting. Ore-waste blasting is the term where the ore and waste rock are blasted in the same blasting process. Blasting is conducted by using nonel initiation system. By multiple pits operation, monthly powder factor is varied from 0.23 kg/t to 0.27 kg/t. Emulsion blend with density 1.15 g/cc is used as bulk explosive. At this stage, the concept of geoblast is proposed as an engineering tool for Drill and Blast engineering practice in PT.IMK. In addition, there is a need to maintain rock fragmentation by blasting, to maintain monthly powder factor, and to maintain excavator’s productivity. Next, the concept of scaled depth of burial (Chiappetta and Treleven, 1997) and the concept of blastability index (Lilly, 1986) are proposed as geoblast’s tools to improve blasting practice in PT.IMK. It is expected that rock fragmentation by blasting, explosive consumption and excavator’s productivity will be maintained by integration of geoblast and drill and blast engineering. Furthermore, the objective of this paper is to integrate geoblast and drill and blast engineering in order to create an engineering guideline in PT.IMK. Additionally, blasting trials with air decking application is proposed in order to support the geoblast’s improvement. It is planned that these blasting trials will be conducted in 2022. In conclusion, it can be seen that integration of geoblast and D&B engineering in PT.IMK is relevant to improve current drill and blast current practice and applicable to maintain rock fragmentation by blasting.

Nov 29, 2022

By G Senanayake, K Hazarika

The demand for iron-ore is ever increasing with the industry directly employing 60 500 people in a range of highly skilled roles in Australia. In the year 2019, the global iron-ore production was 2.85 billion tonnes. It is estimated that each tonne of beneficiated iron ore produces 400 kg of tailings. The IOTs are fine, dense and stable crystalline material mainly composed of iron oxides, alumina and silica. The current and most applied method of iron-ore tailings (IOTs) disposal is using subaqueous disposal of tailings in dams. The footprint generated by a tailings dam is massive and requires constant monitoring due to the possibility of a failure making the operation and maintenance of tailings dam extremely expensive. This review briefly discusses the known causes of tailings dam failures, their impact to the environment and day-to-day human life and potential applications of IOTs. The increase in water content enhances the pressure on dam walls. This in turn increases the liquefaction potential of the tailings and reduces the overall strength of the dam making it more vulnerable to failure. Potential applications of IOTs are in paints, aggregates in construction materials and bricks. The reuse of IOTs reduce waste and generates further revenue facilitating a path towards a sustainable future for the industry.

Nov 8, 2021

By J M. Nel

Richards Bay Minerals (RBM) has recently undertaken an exercise to improve orebody basal definition. Older mineralisation bases (pre-2005) were highly erratic using old protocol reverse circulation (RC) (also known as Air Core) drilling and interpretation. The erratic nature of this estimation tool, resulted in impractical modelling towards the end of mineralisation (EOM), difficult mine design and unrealistic reconciliation. New protocol drilling, which includes high definition SONIC drilling data, has provided more data to be available for more accurate interpretation. Recent advances in drilling methodology has allowed for better penetration depths for SONIC drilling, which was previously restricted to approximately 80 m (pre-2005). This improved data set allows more emphasis on geological interpretation with factors such as lithology, slime content, and mineral species distribution. These factors when in unique combination enable more accurate and realistic EOM data points. These points are modelled into surfaces using conditional simulation techniques and result in a vastly smoother surface and consequently, a more representative resource.

Oct 5, 2011

By L Abrahamsson

This paper describes results from a gender study for a new mine in Pajala, a small community in northern Sweden. Using a gender perspective, the study examines migration, education, local culture, the labour market, and work organisation as problems and opportunities in the regional context for the planned mine. The most obvious ‘gender issue’ for the Swedish mining industry is the very low percentage of employed women, which is even lower among mining workers. To recruit the best people, a company actively needs to attract both women and men; however, the mining companies find it difficult to recruit women as cultural, labour market and educational traditions as well as the mining companies’ own cultures often make it difficult for women to find work in the mining industry.The Torneå river valley, the region surrounding Pajala, has a gender-segregated labour market and gender-stereotyped culture and few young women live in this traditional and oldish region. Many young people leave the region and this is especially true for women. Compared to the rest of Sweden, there is a low educational level, especially among the men. In the mining companies, as in many other male homosocial workplaces, the workplace culture has strong connections to a certain type of traditional masculinity (laddishness, a kind of ‘macho-style’) and for a long time this has excluded women. ‘Gender’, however, is not only a question of recruiting women to a male-dominated industry. An organisation that discriminates according to gender can become inflexible, hindering communication, learning, innovations and change processes. In mining companies, this can manifest itself in hesitant attitudes among the miners about safety as well as organisational and technological development.This study found that companies establishing a presence in this region should develop a strategy for how to deal with and manage the risks and opportunities in the surrounding society (the regional culture) as well as inside the company (the mining culture). This need to be strategic will also be required of future mining companies as they will face higher demands on safety, gender equality, and technology to become modern, efficient and lean organisations.

Nov 22, 2011

By J P. Sykes, A Trench

"World-class mine projects are increasingly failing to become world-class mines. Non-technical, socio-political and environmental problems seem, in part, to be the cause. However, the intangible and qualitative nature of these problems means overcoming them will require a greater systemic understanding of how the various technical and non-technical factors interact. This is particularly important as the concept of sustainable development has changed the industry paradigm sufficiently that it is no longer clear what world-class means. Finally, this better systemic understanding of mine projects needs communicating back to the exploration sector to improve exploration targeting.However, a disconnect between the exploration and mining sectors and between geologists and mining’s other professional disciplines means this is currently not possible. The use of economic evaluation techniques to assess the risk and value presented by the various technical and non-technical factors can assist with this by giving the varied professions a common language and including inputs from all disciplines. This paper therefore suggests a theoretical framework for analysing the various technical and non-technical factors, particularly the most challenging intangible and qualitative ones, and incorporating them into the typical economic evaluation techniques used in the mining industry.Understanding the risk and value relating to both technical and non-technical risks, however, places a greater emphasis on mining geologists to be conversant with a wide range of disciplines. Mining geologists will have to develop three types of knowledge:focusedinter-disciplinarybroad. In addition, they will have to become systemic thinkers to connect these types of knowledge. This multidisciplinary approach will require the use of fundamental critical thinking skills, common sense, intuition, experience and quantitative modelling techniques, dependent on the situation. As a result, both companies and professional societies, such as the Australasian Institute of Mining and Metallurgy, will have to develop ways of improving mining geologists’ inter-disciplinary and broad knowledge.CITATION:Sykes, J P and Trench, A, 2014. Resources versus reserves – towards a systems-based understanding of exploration and mine project development and the role of the mining geologist, in Proceedings Ninth International Mining Geology Conference 2014 , pp 243–270 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Aug 18, 2014

By C Tapia Cortez, C Sammut, S Saydam, J Coulton

‘Like every other commodity, the value of the metals is subject to variation’ (Ricardo, 1817). Mineral commodity price uncertainties have always been a significant issue in mining business due to the close relation between global economic conditions and commodity prices, which commonly generates significant and unexpected price fluctuations. Price forecasts have been driven by economic theory, which states that in the long-run market will be balanced and that prices tend to the marginal cost of production. However, this theory has been misunderstood in the mining industry and future prices through time, in real terms, are assumed to be unchanged. This is unrealistic due to regardless of the cycling nature of economy and the omission of uncertainties. Furthermore, using historical data in traditional price forecast approaches does not guarantee realistic predictions as past events will not necessarily be repeated at the same intervals and with the same intensity. Mining, finance and economic sectors have made significant research efforts to predict prices and control uncertainties through classic linear, Gaussian and probabilistic simulation approaches. However, by definition, uncertainties cannot be measured or accurately modelled. Uncertainties can be identified to measure and manage the associated risks; therefore, uncertainties in mining projects have been historically misinterpreted, erroneously measured and poorly controlled. It is widely known that supply and demand functions drive market prices. While technological development noticeably influences supply, demand is strongly driven by psychological factors, mainly related to customer preferences and lifestyle expectations. Thus, human behaviour is one, or if not, the most important variable to determine commodity prices in a competitive market. During the last decades, alternative methodologies have been used to study uncertainties in human, environmental and market behaviours. Chaos theory, fractals, artificial intelligence and econophysics have been widely and successfully used to investigate complex dynamic systems to address uncertainties over time in the fields of neurosciences, meteorology, aviation and market trading. The application of these techniques in the market suggests a more realistic approach to the business environment. Through the combination of the methodologies above a novel long-run price uncertainties simulation approach that emphasise the differences between risks and uncertainties is proposed in this paper. CITATION:Tapia Cortez, C, Saydam, S, Coulton, J and Sammut, C, 2015. Copper price uncertainties – chaos theory to manage risks in mining projects, in Proceedings Third International Future Mining Conference, pp 261–272 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Nov 4, 2015

By N Cusworth, W R. Mackenzie

"In 2007, the authors presented a framework for the conduct of resource project feasibility studies and provided guidance on minimum standards and best practice (Mackenzie and Cusworth, 2007).This paper will present the authors’ observations in relation to feasibility studies undertaken to support investments made during the unprecedented period of resource project capital investment since 2007. It will also provide comments on general trends in the mining industry’s approach to project assessment and update recommendations on best practice.CITATION:Mackenzie, W R and Cusworth, N, 2016. The use and abuse of feasibility studies – has anything changed?, in Proceedings Project Evaluation 2016, pp 133–148 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Mar 8, 2016

By C Katonga

Mindola mine is currently the deepest mine in the Zambian copper belt. Stoping is currently active to 1330 m below surface with long range plans indicating future production from 1590 m level. The orebody is tabular and dips between 55o to vertical. The thickness varies from 8 to 14 m. The vertical crater retreat method of mining was first introduced at Mindola mine in the late-1980s following several trials that helped define the design criteria for its application. Over the last ten years the method has been continually modified to improve safety and maximise ore production. For example, due to the weakness of some rock units within the orebody formation and the instability of the hanging wall, the last VCR slices are usually between 8 - 10 m thick, and efforts are being made to strictly apply shrinkage method in order to reduce dilution. Recent advances in mining technology in the areas of equipment, blasting techniques, rock mechanics and materials handling have been employed to increase the overall productivity of the mine. Large down-the-hole machines capable of drilling 165 mm diameter blast holes, up to 80 m long are used in stoping. Each stope produces up to 20 000 tonnes of ore per month and can last for three months. Heavy systematic ground support of VCR development has significantly enhanced safety for mining crews and equipment. Crater mining has not only improved productivity and enhanced safety, but also overcome various problems associated with conventional sublevel open stoping previously employed at the mine. This paper discusses the technical and operational aspects of vertical crater retreat mining at Mindola mine during the last ten years. The changes in mining method are often accompanied by changes in mine design, blast design, mining equipment, ground support and operating practices.

Jan 1, 2000

The Kalgoorlie Golden Mile is proposed as an Archaean volcanogenic-type deposit, modified and redistributed along later-developed structures. Rich pyritctelluride and Green Leader gold mineralization is associated with the end phase of basic volcanism and, in a general sense, is confined to a broad interface zone between the products of marine basic volcanism and later acid volcanism. There is virtualIy no ore associated with the main body of acid volcanics.Green Leader is the local name of a type of ore that occurs at some igneous rock contacts in association with graphitic sediments and layered acidic tuffs. It is characteristicalIy green, of various shades, and commonly yields very high gold assays, the reasons for which are not apparent in hand specimen.Carbonates, carbonaceous shales, tuffites, rich gold ores, and acid and intermediate dykes, alI indicating a common heritage, are features common to the main ore hosts, viz. the Paringa Basalt (Calc Schist) and theGolden Mile Dolerite ("Quartz Dolerite Greenstone").Several probably related fracture systems have reconstituted most, but not all, of the original deposits into a large number of steep tabular lodes.Includes two sets of discussions and comments from later Proceedings volumes.

Jan 1, 1974

By J T. Smit

The theory of froth flotation developed slowly, in almost all cases lagging behind practical developments in the operation of flotation processes. This was largely the result of a lack of understanding of the required basic principles of chemistry and physics, many of which were being developed at the same time. A review of some of the early theories propounded is worthwhile, and should encourage those who are presently studying or practicing flotation to exercise some care in claiming a complete understanding of the underlying phenomena in the art. This paper considers theories presented up to and including those in Principles of Mineral Dressing by Antoine M Gaudin (1939). Of course, developments since that time are important, but they are beyond the scope of this discussion.

Jan 1, 2005

A broker relies heavily on mineral valuations and independent experts' reports to provide the fundamental information, both technical and commercial, which provides the basis of estimating the sharemarket value of securities and underlying assets. It is important to appreciate the significant variance that can occur between the market value and other types of valuation at a particular point in time. In general, most experts' reports and valuations seek to provide estimates of technical/fundamental or ""fair"" value which correspond to the Corporations Law and accounting standards requirements. They do not usually attempt to estimate (stock) market values and it is usually and quite correctly the broker's task to estimate market values on the basis of a technical appraisal and consideration of all other commercial, market and financial influences. Therefore ideally, an independent experts' report or information memorandum will include material relating to commercial and management aspects of a company as well as detailed technical reviews and fundamental valuations. Wherever sensible cash flow projections can be made, cash flow-derived valuations, usually based on discounted cash flow (DCF) calculations, remain the preferred valuation methodology. Brokers in general would not argue with this preference. However, there is a paucity of examples of valuations where alternative methods are applied as a check on the reasonableness of a DCF-based estimate.

Jan 1, 1994

By W Patton

Investment decisions in the mineral resources sector are made on the basis of an assessment of the economic potential for a mineral deposit. Given the supporting information for the location, scale, and quantity of the commodity of interest, miners and investors aim to make risk-informed decisions when considering further investment. The objective of resource classification is the synthesis of various types and quantities of geologic information used in resource model construction to assign confidence categories to the estimated mineral resources, which can then be used to support informed economic decisions. In this paper a risk-based classification scheme for iron ore mineral resources using conditional simulations is presented. The method involves categorisation of each block according to a confidence level, considering expected recoveries from a kriging model over mining production volumes. The realisations of the simulated model are used to assign risk-based confidence categories to zones of the ore deposit. One motivation for this work is to assess the sensitivity of the scheme to geologic uncertainties. Specifically, that which uncertainty in the layout of mineralising alterations and weathering overprints influence variabilities of associated rock properties and the likelihood of obtaining expected ore recoveries. It is shown these risks have material implications for a project’s economic potential. How the scheme can be extended to the grade control context and the value subsequent grade control activities is also quantified.

May 24, 2023