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By Lance A. Roberts

Expansive soil formations can be found throughout the United States. When subjected to wetting, these formations have the potential to swell and exert large uplift forces on buildings and foundations. Lightly loaded structures, such as single family residences founded in areas of expansive soils, can be significantly damaged due to uplift movement from swelling actions. Designing an economical deep foundation that can resist uplift forces is critical to prevent damage to these structures. The current solutions to control uplift due to swelling soils, such as over-excavation and replacement of the expansive material or the use of drilled shafts can be costly. Piles made from recycled polymer materials could provide a solution. Due to a lower coefficient of friction along the interface of the soil-pile interface compared to traditional pile materials, solid recycled plastic piles can allow expansive soils to move nearly independently from the pile when wetted. This results in a much smaller magnitude of uplift force being transferred to the structure, which minimizes the risk of significant structural damage from excessive movements. This paper presents the results of research conducted on the use of recycled plastic piles in an expansive shale environment. The preliminary phase of the project involved the installation of six recycled plastic piles at a test site on the South Dakota School of Mines and Technology campus. Two of the piles were subjected to a full-scale compression load test in order to determine ultimate capacity. The remaining four piles were subjected to long-term monitoring of uplift movement during the course of the project. A concrete anchor was also installed at the test site for uplift monitoring. Data gathered during the field and laboratory testing was utilized in a non-linear soil-structure interaction model to predict the displacement behavior and internal stresses within a plastic pile and concrete anchor subjected to uplift forces from the swelling shale. While more research is needed to further understand the application for recycled plastic piles, the results from this research indicate that their use is a viable alternative for support of lightly loaded structures in expansive soil environments.

Jan 1, 2010

By Manqiu Xu, Peter Wells, Gord Bacon

"A methodology is proposed for milling flowsheet design using flotation rate, selectivity and residence time distribution data. The flotation rate data and the difference in flotation rates between the main minerals to be separated are determined from laboratory batch tests. The residence time distribution (RTD) data is calculated using the tanks-in-series model assuming each flotation cell is a perfect reactor. The rate, selectivity and RTD data can be used to calculate the optimum flotation cell number in a bank for rougher/scavenger in a commercial plant.This methodology is demonstrated in a case study of a nickel sulfide ore. It is shown that miniplant rougher/scavenger data can be closely predicted from a batch test using the proposed methodology.INTRODUCTIONIt has been the trend in the past several decades that large flotation cells are increasingly used. This is largely driven by the economics as ore grades are getting lower and the rate of ore processing must be increased in order to keep mining operations economically viable. The development and evaluation of 250 to 500 m3 WEMCO SmartCell and Outokumpu TankCell flotation machines are well in progress. There are many advantages in using large cells: fewer cells, less floor space, lower power cost (although this is now being questioned for fine particle flotation), simpler circuit, simpler control, and lower auxiliary equipment cost (Arbiter, 1999). As flotation cells are getting larger, the importance of cell hydrodynamics, namely, air/slurry dispersion, power intensity, froth transfer, residence time distribution (RTD) and short-circuiting are being fully recognized (Jonaitis, 1999; Weber, et al., 1999; Gomez and Finch, 2002). It is not the intention of this paper to discuss flotation cell scale-up. The intention is to answer what is the optimum number and size of cells in a flotation bank for a given throughput. Figure 1 illustrates this problem facing design engineers. The same mean residence time required for a given throughput can be achieved in a single large cell, or many smaller cells in a row. A few cells of large size may be more cost-effective but they may not be as effective as more cells of smaller size in achieving the optimum metallurgy."

Jan 1, 2005

This publication summarizes the in-house and contract research and development projects programed for fiscal pear 1980 by the Bureau of Mines under its Minerals Environmental Research activity. The document provides a mechanism for interested parties, including potential contractors, to gain insight into ongoing and projected work of the Bureau's environmental research efforts. Research to identify and correct environmental problems associated with mining and metallurgical operations has long been an integral part of the Bureau's mission. Through the years, efforts of various Bureau programs have yielded valuable information on the origin and control of many of these problems. With the reorganization of the Bureau of Mines in 1979, the Minerals Environmental Technology program was structured to consolidate these efforts into a single program that will systematically investigate al aspects of mining- and processing-related environmental pollution and damage-from initial discovery of the mineral resource to ultimate return of the land to productive use. In fiscal year 1980, the Bureau received an appropriation of about $21 million to conduct research and development work on these problems.

Jan 1, 1980

By D. J. Burger

This paper will highlight the system components of a successful underground mining automation project recently launched at DeBeers Finsch Mine. It will also show that integration of short-term mine planning with other upstream and downstream mining processes in the extraction of kimberlite ore from a block cave is not just critical to the future sustainability of this underground mining operation but also for profitability and cost-effectiveness. This paper will discuss the information data flow required from the mine-planning process through to production for underground block cave mining. The benefits associated with this type of integrated mine planning and automation system will be highlighted.

Jan 1, 2006

By P. Forbes

Mining and metallurgical processing companies that have adopted the principles of good environmental management often find it difficult to carry out an environmental assessment that yields meaningful opportunities for improved performance. This topic was investigated by means of a case study of a South African Base Metal Refinery (BMR) producing primarily nickel. A process-based Life Cycle Assessment (LCA) was carried out on the refining process, with the environmental impacts related to the production of reagents and utilities forming part of the assessment. The lifecycle inventory (LCI) was based on plant operating data spanning 31 months of production, from which a baseline environmental profile could be generated and interpreted to indicate the main sources of potential environmental impacts. Consequently, opportunities for improved environmental performance could be identified from the LCA model, which expressly related potential environ-mental liability to specific sub-processes in the assessed industrial operation. The on-site steam plant was found to be the primary source of potential environmental impacts in most of the impact categories considered. In closing, the paper discusses some of the limitations encountered in use of the LCA method. Keywords: life cycle assessment; LCA; life cycle inventory; LCI; base metal refinery; improved environmental performance; environ-mental management systems; nickel refining.

Jan 1, 2000

By L. A. Cramer

South African platinum mines produce the world?s majority of platinum metal that is used in autocatalysts and jewellery. As the platinum market is forecast to grow at healthy rates into the future, the South African producers, Anglo Platinum, Impala, Lonmin and Northam, are planning to expand in the next decade. Furthermore, a number of smaller producers who are accessing other mineral rights are entering the buoyant market. The South African platinum mines have traditionally exploited the Merensky Reef of the Bushveld Igneous Complex (BIC); however, the mining of this reef is reaching depths that require significant vertical shaft systems and costly refrigeration for access to the orebodies at deeper levels. In the past decade all of the producers have begun to mine the less attractive UG2 reef because of its cheaper mining costs. This UG2 reef contains significant quantities of chromite with typically a chrome-to-iron (Cr/Fe) ratio of 1.35. UG2 ores can contain between 10 and 25% Cr2O3dependingupon the reef width and the selected mining method. It is relatively cheap and easy to extract a portion of the chromite from a platinum concentrator tailings stream at a grade of between 40?42% Cr2O3. However, it is only in recent years that some ferrochrome producers have begun to source some of their chromite from the tailings of platinum producers. South Africa is also the world?s largest single producer of ferrochrome and supplies much of the world?s stainless steel producers and thus the growing market for their product. As the traditional sources of high Cr/Fe ratio ores have been depleted at the shallow economic depths and thus have become more expensive sources of chromite, technical developments have improved the ability to use fine chromite economically to make acceptable grades of ferrochrome. Thus UG2 fines are now becoming possible cheap sources of acceptable feed to the ferrochrome industry. The abundance of feedstock for ferrochrome production and the lessening dependence on mined material will impact upon the structure of the ferrochrome business in South Africa. With continued platinum mining from UG2 reefs, South Africa is set to remain highly competitive in the world?s ferrochrome/stainless steel industry.

Jan 1, 2004

The objective of this handbook is to provide the inspector with guidance for recognizing hazards from inhalation contaminants in above ground work areas of underground and surface coal mining and processing facilities and evaluating these hazards by collecting samples or making field determinations and interpreting the analytical results. There are several portions of the handbook which should prove most useful to the inspectors. The names and locations of these portions are listed below: Survey Check List (Page 2-3) Rules for Determining if Sampling is Required (Page 2-1) List of Most Frequently Encountered Contaminants (Page 2-2) List of Candidate Contaminants and their Sampling Conditions (Table 2, Starting on page 2-5) Interpretation of Results (Page 2-16) Procedure for a, Health and Safety Inspection (Page 2-25) For obtaining information not available from the above mentioned portions of the handbook, the inspector is directed to the Table of Contents, the Glossary of Terms, and the List of Commercial Products Encountered in Surveys.

Jan 1, 1975

The Golden Cross project was a joint venture between Coeur NZ Ltd (80 per cent) and Viking Mining Company (20 per cent). The site is located in the Waitekauri Valley, 8 km north-west of Waihi, on the Coromandel Peninsula, in the North Island. The mine-site is situated close to the Coromandel Range Divide between the headwaters of the Waitekauri River and the Martoto Stream. The site has a history of Gold Mining dating back to 1892. The more recent mine comprised an open pit and underground gold and silver operation from December 1991 to April 1998, MacGillivray, Maton and Goldstone (2000).Doug Hood Ltd commenced the first of three contracts on site in September 1997 and was responsible for completing the final stages of open pit mining, landslide remedial works mine closure and rehabilitation works. The Mill Closure and Rehabilitation and Drainage Works contract, for which this submission relates, commenced in September 1999 and was officially completed by Doug Hood Ltd. on the 26 May 2001.This paper endeavours to highlight the project objectives and backgrounds them against the difficulties experienced with respect to the site-specific conditions, the design complexities and risks associated with the contract, from a contractorÆs perspective.

Jan 1, 2002

By Seung-hoon Lee

The use of piled raft foundations has been considered as an economical alternative to conventional piled foundations because a portion of the applied load is carried by the raft in the design of piled raft foundation. In analyzing the behavior of a piled raft foundation as a settlement reducer, an accurate estimate of settlements of the system should be made on the basis of the understanding of nonlinear behavior of piles in layered soils as well as the interaction between the raft, soils, and piles. Although the 3-dimensional finite element method and simplified analysis methods have been used for the design of piled raft foundations, these methods were found to be inadequate for the practical purpose or could not consider the interactions properly. This study developed an approximate hybrid method of analysis to be used for the practical design of piled raft foundations considering pile-soil, raft-soil, pile-soil-pile and raft-soil-pile interactions. In the presented method of analysis, the settlements of the system are estimated satisfying the compatibility of two separate models which are the flexible raft model consisting of 2-dimensional finite elements supported by springs representing soils and piles, and the group-pile model embedded in layers of soil having different properties. Comparisons with other analytical methods as well as a 3-dimensional FEM program were made to verify the sufficient capabilities of the proposed hybrid model for application to practical design and analysis of piled raft foundations.

Jan 1, 2008

By A. D. Davis

Limestone-based technology for arsenic removal from water is an innovative and promising method. The technology offers the potential for low-cost disposal of a stable waste product after arsenic removal, either in an ordinary landfill or by encapsulation in concrete. Leaching research described in this paper shows that the limestone waste, after encapsulation in concrete, passes the Toxicity Characteristic Leaching Procedure (TCLP) test. Leaching was less than 0.05 mg/L, which is 1/100 of the U.S. EPA?s standard for disposal of arsenic in a landfill. Disposal of arsenic-enriched waste is critical for commercial viability of arsenic-removal technologies. Low-cost disposal gives the limestone-based method an advantage that could help communities meet the new maximum contaminant level of 10 parts per billion for arsenic in drinking water. The ability to recycle the waste material in concrete could add a significant economic benefit, further reducing overall costs.

Jan 1, 2009

By Dennis E. Mitchell

The need to develop and field explosive, pyrotechnic and propellant initiating systems that have high reliability and extraordinary safety requirements has led to the exploration and development of several materials and initiation systems at our laboratories. Our approach to initiating device development encompasses five main areas; energetic materials development , device physics, theoretical analysis and model development and experimental verifications

Jan 1, 1995

By Richard Gertsch, Jack Eloranta, Leslie Gertsch

An ongoing research program is characterizing the ore qualities that most affect mine and mill processing of iron. Current practice uses assays of magnetic iron and silica, but additional qualities are needed for advanced process control. If additional qualities can be measured from core, blastholes, or process samples, they can be modeled and controlled similarly. What qualities, other than assays, hinder or facilitate beneficiation at each processing step, and how can they be measured in the mine/mill ore stream? This paper describes preliminary determinations of the effects of ore chemistry, hardness, blasthole drill performance, fragmentation control, and grindability on mill performance.

Jan 1, 2005

By A G. Cuison, B V. Andam

Three well-known copper and gold deposits in northern Luzon, Philippines are located in the Mankayan Mineral District. These are the Lepanto Copper-Gold Deposit, the Far Southeast Porphyry Copper Deposit and the newly discovered Victoria Gold Deposit. The latter discovery led LCMC to shift from a predominantly copper mine to a gold mine. The pre-Eocene Lepanto basement andesite and the middle Miocene Balili volcaniclastic sequence underlie the Mankayan Mineral District. They are intruded by tonalitic to gabbroic Bagon Intrusive followed by diorite-quartz diorite intrusions. Diatreme emplacement of late Miocene-early Pliocene Imbanguila dacite pyroclastics and porphyries took place much later. Faults in the district mostly form a conjugate fracture pattern dominated by north and northwest trending shears, east-west trending extensional fractures and few north-south trending fissures. Victoria is an epithermal gold-base metal rich quartz vein deposit. The veins occur along tensional structures and it is common to observe crustiform and banded features among the sulphides and gangue minerals. It is an open space infilling type of mineralisation. The Victoria vein systems are divided into zones based on continuity. In each zone are major veins and associated spits. Dacite pyroclastics and porphyries predominantly host the major veins with a few narrow veins hosted by the Balili volcaniclastics and the Lepanto metavolcanics. The veins generally trend east-northeast with 75 - 80 dips towards the south. The longest vein can be traced fairly continuously for a horizontal distance of about 600 metres. The vertical persistence of major veins exposed on three level drives has a range of 150 metres and can reach as much as 400 metres based on drill hole intercepts. The vein widths vary from two to eight metres. Right lateral movements of either the NW or NE shear faults could have produced the east trending tensional fractures. The development of ore shoot patterns was recognised and has been helpful to the mining operations. Cymoid loops with defined pinch and swell features are noted both laterally and vertically. Complementing the structural pattern is the distribution of gold values along veins where lateral and vertical continuity is also observed. Gold is associated with quartz, sphalerite, galena and chalcopyrite. In relatively high gold zones, the abundant sulphides are sphalerite and galena. In relatively high copper zones, there is an abundance of chalcopyrite and tetrahedrite. Galena is always associated with sphalerite but less in abundance. Chalcopyrite occurs either as separate bands from or associated with sphalerite-galena. Chalcopyrite and tetrahedrite appears contemporaneous with sphalerite and galena but in some portions the former cuts the latter sulphides. The predominant gangue minerals are quartz, carbonates and gypsum. Rhodochrosite is the predominant carbonate gangue. Few sulphides are found in the carbonates. Gypsum (anhydrite) is found cross-cutting early mineralisation. It carries very few sulphides. The alteration halos around veins are relatively narrow. In an outward sequence, the silicic alteration occurs very near the veins, followed by sericitic-argillic alteration then to propylitic zones. It is also common to observe veins bounded by propylitic alteration. Preliminary paragenetic studies show apparent three stages of mineralisation, the early-quartz (-gold) stage followed by a carbonate stage and a late-gypsum stage. The abundance of base metals relatively decreases towards the gypsum stage. The Victoria gold deposit could have some genetic associations with the Lepanto Cu-Au deposit and probably indirectly with the FSE porphyry system. It is relatively apparent that the Victoria quartz-gold-base metal veins could have occurred similarly as the quartz-gold roots overprinting the Lepanto enargite mineralisation. This overprinting signifies the waning stages of the entire hydrothermal system.

Jan 1, 1999

By P. Massacci, F. La Marca, G. Bonifazi

Certain deposits of incoherent materials which are near the surface and exploitable by open-pit mining may be characterized in real time before they are mined through an analysis of ground-surface imagery. If the slice to be stripped is not overly thick, in fact, surface texture and color properties may be extrapolated to its entire thickness. Image analysis techniques to process ground surface images acquired in situ(or in the laboratory shortly after their acquisition) which yield pattern vectors representative of RGB color component distributions and HSB texture parameters have been developed. The techniques were applied to a mineral sandy ore deposit containing three different lithotypes. Geostatistical analyses showed that the data used to characterize the lithotypes were reliable. The correct recognition of the lithotypes was carried out using a multi-barycenter classification algorithm. Such in situ image-analysis procedures open the way to the proper selection of the ore to be mined, or the proper way for run of mine (r.o.m).processing, or the appropriate blend to be processed before or at the same time as the mining process itself is enacted.

Jan 1, 1999

By Luis Maldonado

El presente trabajo señala el desarrollo y aporte de la geotecnia en la minería subterránea, particularmente de la mina Ares, así como define algunos conceptos importantes empleados para determinar los diferentes tipos de refuerzo y/ o sostenimiento utilizados.También evalúa la estabilidad de las labores subterráneas y la elección de un sostenimiento apropiado por zonas delimitadas en los planos geotécnicos. En ese sentido, para la sistematización, cuantificación y calificación de las características geomecánicas de los macizos rocosos, se evalúa las propiedades del macizo como la combinación entre las características de las rocas y sus discontinuidades. De forma que se pueda determinar una cuantificación geomecánica que dilucide el sostenimiento y el método de excavación en base a la más adecuada clasificación requerida.

Sep 13, 2001

Preface The intention of this paper is to provide the reader with knowledge gained here at Memorial University regarding the practical use of the Bruker SDD x-ray detector for applications in image analysis. Included below are descriptions of the detector’s characteristics and observations regarding precautionary use. What is described below is relevant to the XFlash® model 3001 detector only, whereas the model 4010 is the new and currently available detector. The manufacturer has provided up-to-date information and a figure that presents very different behaviour relative to the characteristics described in this paper. That information and figure is also included here as an addendum (see figure 9). Introduction It has been more than two decades since an image analyzer has been proposed based on the unique imaging characteristics and spatial resolution provided by the scanning electron microscope (SEM) together with energy discriminating x-ray (EDX) acquisition (Reid et al, 1984). From the inception of technique, technology of the day has played the major role for making applications increasingly more practical. Computers, digital imaging, and softwares together with computer automation of modern digital SEMs have all played their part in advancing the technique to where it is today.

Jan 1, 2007

By F. A. Penning

Improved skips, with lightweight cylindrical bodies, have made a significant contribution to advancing mine hoisting technology. New concept skips of aluminum bodies with rubber lining; fiberglas bodies with polyurethane liners have been designed and fabricated for field testing at an operating mine. New design, adjustable guide rollers have shown improved ride characteristics with noticeably less wear. Major reductions have been made in stress levels and stress concentrations. Field experience has shown the practicality of the approach. Guide alignment has been measured using the Guide Alignment Measuring System (GAMS). Analysis has been applied to interpret the data. Field measurements in an operating shaft and a test tower have shown the agreement in data from GAMS and plumb wires. Reproducibility has been demonstrated. The data are useful to realign shafts, to use as s maintenance tool, and to evaluate the maximum safe hoisting speeds. The surveys are made at several hundred feet per minute and the system is self-contained. Dynamics of skip-guide interaction has been analyzed using the computer program SKIP II. The effects of speed, weight, type of guides, kind of misalignment have been studied. Resonance has been demonstrated and factors that eliminate resonance have been identified. Data from the GAMS surveys are applicable to the SKIP II program. Interaction between the hoist rope and the mine conveyance has also been studied. Computer programs and closed-form solutions are presented. Economic impact of lightweight skips is presented for an existing mine and for a new mine. Reduction in rope size has a profound effect when using a lightweight skip for the same capacity. Increased productivity can be realized by keeping maximum rope pull the same while increasing skip capacity. Examples and charts project the significant savings in capital expenditure for new installations.

Jan 1, 1985

By Harry D. Lewis

Gilsonite is a lustrous black material that can be easily crushed into a chocolate-colored powder. It is a solid but relatively soft, lightweight hydrocarbon that visually resembles the volcanic glass obsidian. It was once thought to be a type of coal, but because it is thermoplastic it melts rather than bums. Gilsonite is found in commercial quantities only in the Uinta Basin of eastern Utah and western Colorado, where it forms vertical, nearly parallel veins of varying depth, width, and length. Gilsonite from different veins has different properties, most notably variations in softening point and solubility. These differences result in its use in a variety of industrial applications. Gilsonite's earliest commercial uses were in varnishes, buggy paints, and beer vat linings. Eventually it came to be used in more than 160 products ranging from inks to explosives. It is exported from the United States to most industrialized countries throughout the world. Today, due to competition from synthetics and other hydrocarbon products, its use has narrowed to several specific industries. Although sold mostly as a commodity, current research is focused on applications for gilsonite as a value added product. Historical Overview The discovery of gold in California and the dawn of the mining era in Nevada, Colorado, and Utah around 1850 brought a wave of prospectors to the western United States. One of those pioneers, Samuel H. Gilson, is generally credited with a major role in the discovery of gilsonite. The material now known as gilsonite was discovered several times from the late 1860s through the mid-1880s. It was William P. Blake who, after receiving samples of the material, wrote a paper in 1885 describing "a new variety of asphaltum from the Uinta Mountains." He termed the material uintaite. Although Sam Gilson was not the first to discover the mineral, he was an-inventor who used gilsonite in products that he patented. It was his conviction that the substance was of great value, which caused some to refer to it as gilsonite. The term Gilsonite became the registered trademark of the American Gilsonite Co., and it continues to be in use today. When the first company was formed to mine this substance in 1886 it was named the Gilsonite Manufacturing Co. This firm acquired many gilsonite mining claims and marketed a varnish made from the material. It was the unusual properties of gilsonite varnish that attracted the attention of Adolphus Busch of the Anheuser-Busch Brewing Co. In 1889 Anheuser-Busch bought out Gilson's interests and formed the Gilson Asphaltum Co. Busch had been importing asphalt from Sicily for use in lining beer barrels and saw gilsonite as being more readily available and cheaper. Although gilsonite did not work well in this application, Busch did acquire a large number of mining claims in the Uinta Basin. In 1903 the parent firm of Gilson Asphaltum financed the building of an 85-km railroad from near Grand Junction, CO, to Dragon, UT, to haul gilsonite ore to market. Underground mining was initially centered near Dragon and then later at Bonanza, UT, as different veins were mined. The railway was abandoned in 1937 in favor of truck transportation. In 1938 Gilson Asphaltum changed its name to Barber Asphalt Co., the predecessor of Barber Oil Corp. In 1946 Barber Oil teamed with Standard Oil of California to form a partnership, American Gilsonite Co., which today has its operational headquarters at Bonanza, UT. Barber Oil investigated many new uses for gilsonite, including the making of petroleum derivatives such as gasoline. This work led to the construction of a 116-km pipeline to carry slurried gilsonite to a refinery in Colorado for the production of gasoline, fuel oil, and coke. Pipeline operations began in 1957 but stopped when the economics of competing with petroleum became unfavorable, and the refinery was sold in 1973. In 1981 Standard Oil (later Chevron) became the sole owner of American Gilsonite and remained so until 1991, when it sold its interest to Stratford Enterprises Co. of Tulsa, OK. The companies have since been merged and now operate under the name American Gilsonite Co. with headquarters in Salt Lake City, UT. American Gilsonite continues to be the world's largest miner and supplier of the mineral. The American Asphalt Association was formed in 1902 by former stockholders in Gilson Asphaltum. This company mined various gilsonite claims until it was dissolved in 1953 and its properties were sold to American Gilsonite and Gordon S. Ziegler and Associates. The Utah Gilsonite Co. was established in 1920 and mined several claims until 1952, when its holdings were sold to Gordon Ziegler. Several other gilsonite mining ventures have been pursued in Utah, although they were significantly smaller in scale than those described above. There are currently three companies which mine gilsonite resin in Utah. They are American Gilsonite Co., Ziegler Chemical & Mineral Corp., and Lexco.

Jan 1, 1994

By B. W. Gandrud

The upper part of the Alabama deposits of crystalline graphite consists of an oxidized ore derived from, the underlying unoxidized ore through prolonged weathering. The degree of oxidation in different sections and at different depths within the bed is nut. uniform. The original ore is hard and blue-gray; the weathered product is soft and brown and is the only part that has been mined to any extent. Samples of both oxidized and unoxidized ores were obtained from two of the large graphite deposits of Clay County. Three additional samples of oxidized ore were obtained from different portions of a third property in the same region. In this report, ores 1 to 5 are of oxidized material and ores 6 and 7 of unoxidized.

Jan 1, 1934

South Africa remains the largest global producer of gold, accounting for 11.3 per cent of total world mine production, which amounted to 2520.2 t in 2005. The benefits and disadvantages associated with hedging practices in general, and among South African gold producers is examined. The wide variety and unique nature of risks faced by the mining industries provide a strong case for hedging. Only the principles of hedging, such as selling ounces of gold in the ground at a pre-agreed price for delivery at a future date as a cost-effective mechanism for price risk management, is discussed. Progressive and cumulative increases in the volume of forward sales in the major producing countries are considered by many to be the cause of the declining gold price over the past decade. In spite of negative publicity, forward selling continued as an industry-wide practice until recently (2002) when the global hedge book contracted by 352 t; contraction amounted to 158.6 t in first quarter of 2006. The objectives and benefits of hedging include continuity and stability of cash flows, stability in price achieved, reduction of frictional costs, and creating an effective management tool. The importance of a defined hedging strategy in reducing uncertainty about the hedging objectives is essential to a successful hedging policy. Historical patterns in hedging revenues at an industry level indicate five distinct periods during which the fortunes of hedgers have fluctuated. Finally, since 2001 the rising gold price and reduced price volatility through the consolidation in the global price means that the need to stabilize revenue flows is less urgent. This has meant that hedging is becoming progressively less important for the mining industry at large.

Jan 1, 2007