Incorporating economic variability into a strategic planning framework

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