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By C. Musingwini

The Bushveld Complex is economically significant and strategically important to South Africa, thus it is imperative that optimal extraction of platinum group metal (PGM) resources on the Bushveld Complex is achieved. Optimal extraction broadly requires that the maximum amount of ore is extracted by excavating and hauling the minimum amount of waste in the shortest possible time, at the least cost, and in the safest and most environmentally acceptable manner. In open-pit mine planning this entails among other things, minimizing the waste stripping ratio, whereas in underground mine planning it includes minimizing the metres of waste development. In conventional mining, the main development that is in waste or partly in waste and defines the mining grid pattern includes levels and raises. It was prudent to consider optimizing level and raise spacing in conventional mining because the method is a prevalent mining method on the Bushveld Complex accounting for nearly 70% of platinum production.

Jan 1, 2010

By J. von Schéele

OXYFINESTM is an oxyfuel-based concept for in-plant recycling. It enables the possibility of fines, dust, sludge (without any drying step) and other by-products generated by the steel- and metal-producing industries to be recycled directly back into existing processes or a separate on-site unit. The results from a full-scale installation (20 000 t/a) and pilot-scale trials with dry and wet materials in the steel and ferroalloy industries are presented. The latter include materials arising from ferrosilicon, ferrochrome and silicon manganese production. The concept not only provides a solution to the problems associated with dust and sludge generated in metal production, it also turns these materials into a low-cost raw material which is useful for the same production process, thus replacing some of the raw material input. If required, it could also be used, possibly as an intermediate solution, to convert the dust or sludge into an inert material with a suitable shape. Under some conditions, a directly saleable product could also be obtained. The paper reviews this technology, its status and benefits as wells as its possibilities with regard to application in ferroalloy production. Keywords: recycling, fines, dust, sludge, ferroalloys

Jan 1, 2004

By J. Riss, S. Gentier, A. Marache

The study of the hydromechanical behaviour of fractured rock masses requires a detailed knowledge of the isolated fractures. The aim of the paper is the simulation of the evolution of the void space, located between both walls of a fracture, during a shear test under constant normal stress. Results of the mechanical simulation model are first validated then analyzed in detail. We observe that, during the shear process, there is an opening of the fracture with the creation of preferential channels. These channels are determined at the early phase of the shear process (pre-peak phase), and we observe during the post-peak phase that void areas increase in size rather than the creation of new apertures. Die Untersuchung des hydromechanischen Verhaltens eines zerlegten Felsmassivs erfordert genaue Kenntnisse der einzelnen Spalten. Ziel dieses Artikels ist die Simulation der Evolution des Hohlraumes zwischen den beiden Wänden eines Spaltes während eines Abscherungsexperimentes unter konstantem senkrechtem Druck. Die Ergebnisse der Modellierung werden zunächst mit dem Abscherungsexperiment verglichen und dann im Einzelnen ausführlich analysiert. Während des Abscherungsprozesses tritt eine Öffnung des Spaltes auf, die die Bildung von bevorzugten Fliesswegen fördert. Diese Kanäle werden bereits in einer frühen Phase des Abscherungsprozesses (pre-peak Phase) festgelegt. In der post-peak Phase tritt dann eher eine Vergrößerung dieser Kanäle, als die Bildung neuer Hohlräume auf. L’étude du comportement hydromécanique d’un massif rocheux fracturé ne peut se faire sans une connaissance approfondie des fractures le constituant. L’étude présentée dans cet article concerne la simulation de l’évolution de l’espace des vides présent entre les deux épontes d’une fracture au cours d’un essai de cisaillement à contrainte normale constante. Les résultats du modèle sont tout d’abord validés puis analysés en détail. On constate que, au cours du cisaillement, il apparaît une ouverture de la fracture permettant la création de chenaux préférentiels. Ces derniers sont déterminés très tôt dans le cisaillement (phase pré-pic), et on observe dans la phase post-pic davantage un accroissement de la taille des chenaux plutôt que la formation de nouvelles zones de vides.

Jan 1, 2003

By J. M. Ortiz

Grade control and short-term planning are usually based on the samples obtained from blastholes. These samples may carry a large sampling and sample preparation error. At El Tesoro copper mine in northern Chile, an advance drilling grid is used for short-term planning and grade control. These drill holes are sampled well in advance, and a short-term model that incorporates several variables and sophisticated estimation methods can be prepared for decisionmaking. An additional advantage of the advance drilling samples is that reverse circulation can be used instead of conventional down-the-hole equipment, and a very careful sampling and sample preparation process can be implemented, reducing the total sampling error. Advance drilling can be performed on a wider grid than blasthole drilling, hence the decision about the grid requires assessing the economic benefit of different sampling grids. Furthermore, this process allows the cost of poor sampling and the effect of different estimation procedures to be quantified. We demonstrate the optimization of the drilling grid for short-term planning and grade control at El Tesoro mine by means of the economic evaluation of the performance of different drilling grids, with different drilling techniques (which differ in the sampling error). The methodology is based on creating dense (exhaustive) geostatistical simulations of the grade distribution over a volume defined for a production period in respect of the geological model, and assuming each simulation as the true grade distribution. Then, samples are obtained from the exhaustive simulations at a spacing similar to the advance grid to be evaluated, and a sampling error is added. The short-term estimation procedures used on the mine are applied to determine the destination of each block and the profit obtained. This profit can be compared with the maximum profit (unachievable) and with the profit under different sampling errors and grids. The results show that the current 8 x 8 m drilling grid is appropriate and by reducing the sampling error, misclassification is also reduced, leading to an increase in profit of about US$ 5 million in 4 years.

Jan 1, 2012

By B. E. Ydstie, B. F. Lund, K. R. Løvåsen, B. A. Foss

The paper presents sensitivity analysis for a dynamic model of submerged arc silicon furnaces. The model we study, called ?Simod?, was developed by Elkem in cooperation with NTNU and Sintef. It is today a much used tool in Elkem for operator training and analysis of the dynamic behaviour of the silicon production process. The aim of our work is to bring the simulator tool closer to industrial practice, and construct a mechanism to adapt the model to the behaviour of a running process, online. The paper presents the results of the sensitivity analysis that has been undertaken for important parameters in the Simod model. The parameters associated with the process inputs are electric power loss, loss of fixed C and reactivity of carbon. The output signals that have been investigated are fed quartz, tapped silicon and silica. The paper also interprets the results of the sensitivity analysis in a process operation context.

Jan 1, 2004

By L. F. Contreras

In open pit mine design, it is customary for geotechnical engineers to define the appropriate slope design angles within practical limits. The conventional approach to slope angle design is based on the comparison of calculated stability indicators, such as the factor of safety (FS) and the probability of failure (PF), with generic acceptability criteria not directly related to the impacts of failure. A major drawback of this type of approach is related to the difficulty of defining meaningful acceptability criteria. An alternative methodology of pit slope design is proposed, where the economic impacts of potential slope failures are calculated and used as the elements on which to apply the acceptability criteria for design. The methodology is based on the construction of a graph, referred to as a risk map, that relates the probability of exceeding the economic impact of slope failure to the magnitude of the impact measured in monetary terms. The process includes the analysis of a selected number of representative years of the mine plan and slope sections of the pit areas to define the required inputs for the construction of the risk map. The paper discusses the concepts used in interpreting the probability of slope failure, and describes the approach followed for the estimation of the economic impacts of slope failure and the construction of the risk map. Finally, the two main uses of the risk map are discussed, including the comparison with acceptability criteria for the evaluation of a specific open pit design and the comparative analysis of open pit design options in terms of value and risk to identify optimum pit layouts.

Jan 1, 2015

By D. F. Malan

This paper gives an overview of the difficulties associated with determining the strength of hard-rock pillars. Although a number of pillar design tools are available, pillar collapses still occur. Recent examples of large-scale pillar collapses in South Africa suggest that these were caused by weak partings that traversed the pillars. Currently two different methods are used to determine the strength of pillars, namely, empirical equations derived from back analyses of failed and stable cases, and numerical modelling tools using appropriate failure criteria. The paper illustrates that both techniques have their limitations and additional work is required to obtain a better understanding of pillar strength. Empirical methods based on observations of pillar behaviour in a given geotechnical setting are popular and easy to use, but care should be exercised that the results are not inappropriately extrapolated beyond the environment in which they are established. An example is the Hedley and Grant formula (derived for the Canadian uranium mines), which has been used for many years in the South African platinum and chrome mines (albeit with some adaptation of the K-value). Very few collapses have been reported in South Africa for layouts designed using this formula, suggesting that in some cases it might yield estimates of pillar strength that are too conservative. As an alternative, some engineers strongly advocate the use of numerical techniques to determine pillar strength. A close examination unfortunately reveals that these techniques also rely on many assumptions. An area where numerical modelling is invaluable, however, is in determining pillar stresses accurately and for studying specific pillar failure mechanisms, such as the influence of weak partings on pillar strength. In conclusion, it appears that neither empirical techniques nor numerical modelling can be used solely to provide a solid basis for conducting pillar design. It is therefore recommended that both these techniques should be utilized to obtain the best possible insight into a given design problem. Owing to the uncertainties regarding pillar strength and loading stiffness, monitoring in trial mining sections and in established mining areas is also an essential tool to test the stability of pillar layouts in particular geotechnical areas.

Jan 1, 2011

By L. A. Thompson, A. J. Linington

"Copper–cobalt extraction is a reagent-intensive process resulting in acid consumption greatly contributing towards production costs, which in the current market conditions curtail profitability. Nanofiltration (NF) membranes have become an attractive approach in the mining and minerals industry for product concentration and reagent recovery based on the ability of the membrane to separate monovalent ions from divalent ions. NF membranes can selectively separate acids from metals and salts allowing acid to be recycled as well as the concentration and purification of product streams. Membrane technology in the field of copper–cobalt processing focusses on the concentration of Cu2+ and Co2+ in the pregnant leach solution, recovery of acid from waste streams to neutralization, recovery of valuable metals from waste ponds and process water recovery. This paper aims to provide insight into the potential applications of NF membranes in copper–cobalt processing circuits as well as a brief overview of the effects of process conditions on membrane performance and process development. INTRODUCTION The copper–cobalt industry commonly uses inorganic acids, such as sulfuric acid, in large quantities for primary leaching of copper–cobalt oxide ores and releaching during product purification (Stuurman et al., 2014). This results in numerous acidic intermediate streams containing high metal concentrations and acidic waste streams with low metal concentrations. Acid consumption typically accounts for 10–15% of the operating costs of mines in the Democratic Republic of Congo (DRC) and Zambia (Acid Plant Database, 2015). Due to remote mine locations, poorly maintained roads and cross-border conflict, the cost of sulphuric acid can range between USD 300 and 400 per ton. The pivotal role of acid in the copper–cobalt extraction process has driven many mines to build sulphuric acid plants on site to ensure a reliable acid supply, however elemental sulphur still needs to be imported which faces similar logistical challenges and contributes towards operating costs."

Jan 1, 2015

By J. T. Nel

The establishment of a pilot plant for the continuous production of titania pigment and nano-titania is discussed. The plant was designed, constructed and operated on the Necsa site. The TiO2 production capacity is 7?10 kg.h-1 by the reaction of TiCl4 and O2at>1000°C. Liquid TiCl4 is sprayed under pressure into a plasma reactor where it evaporates and reacts with O2 to form TiO2. Process optimization has allowed for continuous production without any clogging or blockages. The primary advantage of the plasma-assisted process is the possibility to recover and recycle the chlorine values in high yield as Cl2 for use in the manufacture of TiCl4. The HCl formed in most conventional fossil-fuelled processes makes Cl2 recovery and recycling much more difficult. Particle size distribution analysis of the fine, white product revealed a d50= 125 nm. The raw product consisted of 60% rutile that could be increased to 80?100% rutile by post-annealing. The specific surface area (SSA) of the pigment was 8?20 m2?g-1(BET). According to the CIE colour index the ?whiteness? (L*>95) of the plasma-produced pigment was better than that of several commercially available pigments. The particle size could be manipulated by controlling the TiCl4 feed rate, gas flowrates, and the particle quench rate and residence time. Nano-sized TiO2 powders with a particles size (d50) as small as 50 nm were also successfully produced in this way.

Jan 1, 2010

By E. V. Lilford

A number of countries have introduced codes governing the valuation of mineral assets and securities. The African continent will follow suit in due course considering the importance of the global minerals industry as it relates to the attraction of foreign investment. South Africa is to introduce the Petroleum and Minerals Development Bill legislating the involvement of previously disadvantaged individuals and communities in the country?s minerals industry. One of the challenges facing the successful implementation of such codes and bills lies with the abilities of independent valuators to value mineral properties and projects on a consistent basis. Certain valuation principles and methodologies are applicable in all jurisdictions in the minerals industry. These valuation tools and principles are considered and developed in this report. They have been discussed and developed to encourage minerals valuators to consider and consistently apply the most applicable valuation methodologies.

Jan 1, 2002

By W. van Antwerpen, J. Guzek, A. Lane

Strategy is about making choices. Mining companies choose to do certain things and not to do other things. Mining is a long-term business, and the choices made typically have large investments attached to them, long payback periods, and significant socio-economic consequences. In today’s uncertain world, it is important to make the right choices. The mining industry in South Africa finds itself in a difficult situation. Operating conditions are tough, the socio-political environment is complex, and financial performance is under pressure. The choices made by all the stakeholders in this industry in the short term will shape the future of the industry. This paper characterizes some of the big, difficult decisions faced by the mining industry in the South African context, and discusses how these decisions could be approached in a fact-based and robust way.

Jan 1, 2015

By O. F. Ochonogor

Laser metal deposition (LMD) is an additive manufacturing technique whereby a stream of metal powder is consolidated by a focused laser beam on the surface of a substrate or engineering component. The interaction zone between the laser beam and powder particles is scanned superficially, generating tracks of deposited material. The tracks are overlapped in a deposition strategy in accordance with slices of a CAD model. Successive layers of material are built up to fabricate a near net shape part. In this work, the technique is used to fabricate metal matrix composites (MMCs) by using an elementally blended feedstock combining metal and ceramic powders in the melt pool, which melt and solidify to create the required morphology. Ti6Al4V + TiC MMCs were produced with 10, 20, and 30 vol.% reinforcing ceramic, and Zr + TiC MMCs were fabricated with 10, 20, and 30 vol.% TiC. The deposited thin walls were analysed using optical microscopy, scanning electron microscopy (SEM) with energy dispersive spectroscopy (EDS), and indentation testing. In both systems, the analysis revealed the presence of partially melted TiC particles embedded in the metal matrix along with fine dendrites of re-solidified ceramic. The dendritic structures in the Ti-based composites were confirmed as TiC, whereas in the Zr-based composite the Zr metal reacts with theTiC to form ZrC, leaving Ti in solid solution. Both the MMCs show an increase in microhardness with increasing ceramic (carbide)content, reaching a peak HV0.1 value of 500 in the Zr- based MMC and HV0.1 of 550 in the Ti based MMC.

Jan 1, 2012

Recently, work was carried out by the Shotcrete Working Group to study anisotropy in steel fibre reinforced shotcrete using strain-controlled, compressive strength testing methods. The shotcrete materials used and specimen preparation procedures as well as testing methods are described. The test results are discussed and it is concluded that, because of the anisotropic nature of fibre reinforced shotcrete, it may be worthwhile investigating the degree of such anisotropy in practice using strain-controlled, strength testing techniques.

Jan 1, 2001

By W. Wittke, J. Gattermann

ABSTRACT: One alternative to close a radioactive waste repository in rock salt is the construction of a “Cross Section Closure (CSC)“ sealing barrier. The proposed material for the CSC is highly compacted bentonite. To investigate the swelling behaviour of a highly compacted bentonite a large number of laboratory tests were performed. In addition, large scale model test were carried out to demonstrate the development of a nearly homogeneous and isotropic swelling pressure. The results of the large scale model tests were interpreted numerically based on the models for stress-strain behaviour and water uptake which are implemented in the finite element codes FEST03 and HYDOPO. The investigations show a good agreement of the results of the model tests and the corresponding analyses and show, that the theoretical models are capable of describing the behaviour of sealing structures based on highly compacted bentonite. ZUSAMMENFASSUNG: Eine Möglichkeit für den Verschluß eines Endlagers für radioaktive Abfälle im Steinsalz ist die Konstruktion einer Querschnittsabdichtung aus hochverdichtetem Bentonit. Zur Untersuchung des Quellverhaltens von hochverdichtetem Bentonit wurden eine große Anzahl von Laborversuchen durchgeführt. Um die Entwicklung eines nahezu homogenen und isotropen Quelldrucks nachzuweisen, wurden darüber hinaus auch Modellversuche in größerem Maßstab durchgeführt. Die Ergebnisse dieser Modellversuche wurden im Hinblick auf die Wasseraufnahme und das Spannungs-Verformungsverhalten mit Hilfe numerischer Berechnungen mit den finite Element Programmen FEST 03 und HYDOPO interpretiert. Die Untersuchungen zeigen gute Übereinstimmungen zwischen Versuchs- und Berechnungsergebnissen. Die numerischen Modelle sind somit geeignet, das Verhalten von Abdichtungsbauwerken aus hochverdichtetem Bentonit zutreffend zu beschreiben. RÉSUMÉ: Une possibilité pour fermer un dépôt final de déchets radioactifs dans sel gemme est la construction d'un étanchement de coupe transversale, fabriqué de bentonite fortement compacté. Pour étudier le comportement de gonflement de bentonite fortement compacté, de nombreux essais en laboratoire ont été exécutés. En outre, des essais sur modèle sur une plus grande échelle ont aussi été exécutes afin de prouver le développement d'une pression de gonflement à peu près homogène et isotrope. Les résultats de ces essais sur modèle étaient interprétés en vue de l'absorption d'eau et du comportement contraintes-déformations par le moyen de calculs numériques avec les programmes d'éléments finis FEST03 et HYDOPO. Les études montrent de bonnes conformités entre des résultats d'essai et de calcul. Les modèles numériques sont ainsi capables de décrire justement le comportement d'ouvrages d'étanchement fabriqués de bentonite fortement compacté.

Jan 1, 2003

By J. J. Swanepoel

Titanium nitride in upgraded nitrided ilmenite (bulk of iron removed) can selectively be chlorinated to produce titanium tetrachloride. Except for iron, most other components present during this low temperature (ca. 200°C) chlorination reaction will not react with chlorine. It is therefore necessary to remove as much iron as possible from the nitrided ilmenite. Hydrochloric acid leaching is a possible process route to remove metallic iron from nitrided ilmenite without excessive dissolution of species like titanium nitride and calcium oxide. Calcium oxide dissolution results in unrecoverable acid consumption. The leachability of nitrided ilmenite in hydrochloric acid was evaluated by determining the dissolution of species like aluminium, calcium, titanium and magnesium in a batch leach reactor for 60 minutes at 90°C under reflux conditions. The hydrochloric acid concentration (11%, 18% and 25%), initial acid-to-iron mole ratio (2:1, 2.5:1 and 3.3:1), and solid-to-liquid mass ratio (1:8.33 to 1:2.13) were varied. The results indicate that a hydrochloric acid concentration of 25 wt% supplied in a 2:1 acid-to-iron mole ratio would produce the most favourable upgraded nitrided ilmenite product. The dissolution of iron in this solution reached 97 per cent after only 60 minutes. The total dissolution of calcium and titanium species was 0.01 and 0.11 wt% respectively. Hydrochloric acid can therefore be used as lixiviant to remove metallic iron from nitrided ilmenite. Keywords Titanium nitride, upgraded nitrided ilmenite, hydrochloric acid leaching, metallic iron dissolution.

Jan 1, 2011

By A. More, J. Bullón

Metal casting is one of the most important operations in ferroalloys factories. After the tapping of the furnace and the depuration of the metal, the preparation for customers with cooling, crushing and sizing begins. In total production costs, this contains around 8 % of the total cost of the metal, depending on the value of the fines and other important parameters. From an investment point of view, this represents around 20% of the total capital for a new furnace. Casting onto a water-refrigerated copper plate is not new for molten metals. In steel, continuous casting machines are normal in every factory. Water granulation casting exists at some ferroalloys plants. However, the majority of plants and production technology still use the technology of lumping, crushing and sizing. This technology is time consuming, produces fines and requires a relatively large work force. In 2001, Ferroatlantica put into operation a new water-cooled copper casting-machine, which seems to be a very convenient solution to solve all these problems. It is in operation at a silicon factory; the same place where the new ELSA electrode was developed for silicon metal production. This paper describes our experiences using it.

Jan 1, 2004

By C. Sawmliana

Deep-hole blasting operations in opencast mines are always associated with some annoyance to the surrounding areas in terms of ground vibration, noise, flyrock, etc. These become more severe when underground mines run parallel to them. Blasting in opencast mines may pose danger to the underground mines in terms of roof/side failures, damage of water dams, isolation/ventilation stoppings and other underground installations. The paper discusses a case study in India on the impact of deep-hole blasting in Ramagundam Opencast Project ? III on the stability of various water dams of GDK-6B Incline coal mine operating in close proximity. The stability of underground water dams of GDK-6B Incline mine was endangered due to deep-hole blasting at OCP-III. There were 15 water dams in seam 3 and 16 dams in seam 4 of the underground mine. The physical strength tests using a Schmidt Hammer instrument were carried out in all the 15 water dams of No. 3 seam and 16 water dams of No. 4 seam. The test revealed that there is a decrease in compressive strength values of three dams of seam 3, namely 6A, 6B and 7. Theose three dams were also directly connected to the water source. Water seepage was also observed from the surfaces of the three dams. However, they were found to be stable in accordance with their design parameters and damage point of view while considering a threshold value of ground vibration as 25 mm/s. It was found that the value of tensile stress generated by a vibration of 25 mm/s was much lower (i.e. 0.171N/mm2) than the tensile strength of the two weakest concrete dams (1.85 N/mm2). Ten experimental blasts were conducted at different working benches of the opencast mine and the ground vibration data were recorded in roof and pillars near various underground water dams. The maximum value of vibration data recorded was 5.9 mm/s in roof near dam no. 1 in seam 3 with the dominant peak frequency of 22 Hz. No adverse effect on either of the dams was observed after that blast. During the period of study, no deterioration/adverse impact was found in any dam of the mine. Based on the results of the study and the analyses of the data, optimized blast design parameters and explosives weight per delay were suggested for the opencast mine to maintain the safety of the underground water dams. Keywords: Opencast blasting, damage, water dams, underground mine, ground vibration

Jan 1, 2009

By P. Altounyan

Techniques used to safely control the roof in UK coal mines for some 10 years have been applied to a South African coal mine. This new approach known in the UK as advanced rockbolting technology, is based on applying four fundamental principles: ?Understanding the roof failure mechanisms ?Using an effective roof support system ?Designing this support using measurement ?Monitoring the performance of the system. The paper summarizes the approach in detail and describes how it is being applied by Anglo Coal, giving results obtained to date. Investigations at a number of South African coal mines, including stress measurements at two Anglo Coal mines, have confirmed that the mode of roof failure (lateral shearing due to horizontal stress) is the same as in other coalfields worldwide, and aspects of current world best practice, including the use of advanced technology rockbolting, are therefore relevant in South Africa. The stress measurements indicated a high level of stress field anisotropy and further investigation of stress conditions in South African coal mines is recommended. The most effective bolting system to resist shear failure is one with high bond strength and stiffness. Short encapsulation pull testing of existing South African systems confirmed that they have low bond strength and stiffness. An improved rockbolt system with the required performance, and features allowing rapid installation and installation quality and performance audit, has been developed and is currently under full-scale trial. Design by measurement and routine monitoring procedures including the use of a rotary telltale device are also under trial. It is anticipated that South African coal mines will be able to obtain significant safety and productivity benefits from the application of this technology.

Jan 1, 2001

By TvS. von Moltke

Steel is a highly versatile material due to its low cost and good mechanical properties, but typically needs some or other form of corrosion protection due to its tendency to corrode when exposed to atmospheric conditions. In the case of organic coatings, the corrosion protection and functionality of the final product is critically dependent on the adhesion of the coating to the surface of the steel. In this work the effect of contaminants and the nature of the surface layers present on industrial steel products are investigated by means of paint adhesion tests, Auger electron spectroscopy (AES), and X-ray Photoelectron spectroscopy (XPS). It was found that the presence of sodium species on the surface is very detrimental to paint adhesion under wet conditions, while satisfactory adhesion may be obtained even in the presence of silicon and carbon residues. It was also found that the nature of the Fe-O layer, formed under wet conditions is labile and different from that formed in dry air, and that subtle changes in process conditions, such as changing the oxygen content of the quench water, may change the adhesion of paint to the surface of the steel. Lewis acid-base interactions are discussed as a mechanism that may determine the bonding between the steel and polymer coating.

Jan 1, 2003

By J. Botin

Traditional risk quantification methods provide little information on the sources of risk, and tend to produce static over-conservative evaluations, which do not account for changes in the performance of the project. Capital investment decisions for large mining projects require more complex risk evaluation models that include the value of flexibility and the different risk levels associated with uncertainty on project variables (price, grade, dilution, and production rates, among many other). In this context, real option valuation (ROV) methods have proven potential to quantify the risk associated with such variables and integrate alternative scenarios and management strategies into the evaluation process. In this paper, a risk quantification model is developed that successfully quantifies the risk associated with dilution, as a function of production rate. This model is then validated in a case study on the Chuquicamata Underground Mine project. Keywords real options, risk management, risk quantification, dilution, minine planning.

Jul 1, 2013