A Stochastic Optimisation Formulation for the Transition from Open Pit to Underground Mining within the Context of a Mining Complex

As open pit mining of a deposit deepens, the cost of extraction may increase up to a threshold where transitioning to mining through underground methods is more profitable. This paper provides an approach to identifying an optimal depth at which a mine should transition from open pit to underground mining. The value of a set of candidate transition depths is investigated by optimising the production schedules for each depth’s unique open pit and underground operations. By considering the sum of the open pit and underground mining portions’ value along with the cost of transitioning corresponding to each candidate transition depth, the optimal transition depth can be identified. The optimisation model presented is based on a stochastic integer program that integrates geological uncertainty. As an input, the stochastic integer program utilises a set of several stochastic simulations that represent equally probable scenarios of the mineral resource. This group of simulations describes the uncertainty in the deposit, while the optimiser aims to maximise value based on discounted profits of both the open pit and underground components of the deposit.CITATION:MacNeil, J and Dimitrakopoulos, R, 2014. A stochastic optimisation formulation for the transition from open pit to underground mining within the context of a mining complex, in Proceedings Orebody Modelling and Strategic Mine Planning Symposium 2014, pp 363–368 (The Australasian Institute of Mining and Metallurgy: Melbourne).