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By T J. V Duffy, L H. D Siahaan, P G. Albert

G-ResourcesÆ Martabe Mine in North Sumatra, Indonesia, is a US$700 M world-class and world-scale operation in a country which, with a few notable smaller scale exceptions, has had no significant hard rock mining development in more than ten years.The mine was commissioned in the middle part of 2012 and poured first gold on 24 July. At full production Martabe will produce 250 000 oz/a of gold and 2 - 3 Moz/a of silver at cash costs in the lowest quartile. The mine location is on the west coast of North Sumatra, which experiences annual rainfall of 4 m with no notable dry season, adjacent to seismically active fault zones, and relatively close to a rural community of 31 000 people with no significant industrial experience.The management team has successfully forged strong links with the various government departments and levels in Jakarta, North Sumatra Province and the local Regencies; developed long-term relationships with the various community groups within the local district of Batangtoru to build a sustainable social licence; has dealt with the physical and environmental challenges presented by the project location, and has successfully raised more than US$900 M over a period of three years for the original acquisition then the development of the project.Whilst in its infancy of operation, the mine is set up to deliver a long-term sustainable future for the company, the shareholders, and the people of Batangtoru and all stakeholders generally. The quality of the project execution and commitment by the company will ensure that maximum value can be delivered from Martabe, not just for the current mine life but from the significant exploration potential that exists on the large tenement area that the company has access to for 30 plus years.This paper will deal with the physical challenges associated with the design, the Indonesian government regulatory requirements for mine development, the social aspects of building a world-class project in a developing area, the in-country commitment necessary for any project development anywhere in the world and the successful funding arrangements for the mine development.CITATION:Albert, P G, Siahaan, L H D and Duffy, T J V, 2012. Building AsiaÆs latest hard rock mine, in Proceedings International Mine Management 2012, pp 189-204 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Nov 20, 2012

By J Harris, M Shi, S Vink, P A. Kirsch

Across the life-of-mine, water is both an essential commodity to mining, and one of the most significant hazards. In Australia, a land of drought and floods, availability of water is a critical strategic risk for mine sites and neighbouring stakeholders, with both insufficient water leading to curtailed operations and contested space, and extreme water closing operations through flooding of mine sites, transportation infrastructure and unplanned regulatory restrictions. In addition to these major strategic risks, water must be addressed in operational risk management activities in many different ways.This paper develops a set of categories for classification of water risks based on academic papers from the water in mining literature. These categories are applied to media content analysis of articles in International Longwall News (ILN) (an online coal industry news site) obtained with the search terms ‘water’, ‘rain’ and ‘flood’. Identified risks are discussed within the context of the life-of-mine. The paper uses these same categories to analyse the treatment of water risks in a new coal industry risk management body of knowledge called RISKGATE (http://www.riskgate.org, Minerals Industry Safety and Health Centre, The University of Queensland). The discussion of water risks in both INL and RISKGATE is compared and contrasted to pinpoint opportunities (and a roadmap) for further development of a specific RISKGATE water module for site-based operations. The media review also identifies areas for development of RISKGATE expansion topic(s) that would address other strategic water risks, eg severe weather events.CITATION:Shi, M, Kirsch, P A, Vink, S and Harris, J, ?2014. Water as risk in mining – media analysis and the RISKGATE body of knowledge, in Proceedings Life-of-Mine 2014 , pp 205–218 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 16, 2014

By A D. Campbell

The sublevel caving (SLC) mining method is becoming more widely adopted as an underground mining method as mines become deeper and target lower grade mineralisation. SLC has been successfully adopted in increasingly complex and wide-ranging conditions in the past 10–20 years, demonstrating the flexibility of the method. Various challenges encountered at SLC mines around the world have led to significant differences in operating practices, mine performance and mine productivity. Unfortunately, aspects related to productivity, operational performance and best practice are not widely published and remain with individual companies. Limited information is publicly available to compare operational performance of SLC mines in the various conditions where the mining method is now being applied. To overcome this shortcoming, a global review of SLC operations was undertaken over a three-year period as part of the Cave Mining 2040 research consortium. The purpose of the review was to document technical and operational practices, hazard management strategies and key benchmarking metrics at SLC mines around the world. A total of 21 mines spread over four continents and 17 different mining companies were included in the project. The main outcome of the project was a manual of operational and technical practices, benchmarking of key metrics and documentation of the current state-of-the-art for each aspect of SLC mining. This paper describes the main findings from the benchmark in terms of mine productivity, including mine development, production and mining costs. The implications of mine scale, depth and ground conditions on operational performance at each of the benchmarked mines is described and charts are provided comparing key productivity metrics.

Mar 29, 2023

By N McKenzie, E Taylor, S V. L Barrett, H Lagger, A Purwodihardjo

This paper discusses the temporary support design methodology for the largest road caverns ever built in Australia—the Lutwyche Caverns—part of the Airport Link project in Brisbane, Australia. The Lutwyche Caverns with a maximum excavated span of 27 m form a key component of this major road project, allowing on and off ramps merging with the underground highway. In addition to the two large span caverns, a 15 m soft ground tunnel with 5 m cover above the caverns and two 24 m deep burial chambers for the 12.4 m tunnel boring machines (TBMs) had to be built in record time at Lutwyche.The temporary support design methodology involved the use of a range of analytical approaches, including empirical methods to provide a starting point for design development, key block models to determine the potential influence of discontinuities on excavation stability and 2/3D continuum and discontinuum models to determine the potential influence of adjacent excavations and the proposed construction staging on the design. In addition, probabilistic analysis of potential kinematic instability using a discrete fracture network (DFN) approach was also undertaken to establish the critical block loads for the temporary lining, while the continuum and discontinuum models were used to design the support for the 1.5 m diameter rock pillar at the north end of the northbound cavern.The numerical modelling was undertaken in close conjunction with the contractor to develop the optimal construction sequence, considering the available construction equipment on-site and the overall project program requirements. Part of the presentation will further show the applicability of the developed design during construction (deformations, monitoring field observations) and lessons learned for future cavern construction in Australia.CITATION:Lagger, H, Purwodihardjo, A, Barrett, S V L, McKenzie, N and Taylor, E, 2014. Temporary support design for the largest road caverns ever built in Australia – the Lutwyche Caverns, in Proceedings 15th Australasian Tunnelling Conference 2014 , pp 399–410 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Sep 17, 2014

By P G. Doig

Recent drops in commodity prices and economic uncertainty have seen many businesses re-evaluate their operational expenditure to ensure mine profitability. The high capital and operational cost of truck and digger fleets has resulted in loading and hauling of material being a significant proportion of a mine’s expenses (Nel, Kizil and Knights, 2011), thus it is often one of the first areas to be considered for cost reduction. If an operation requires additional trucks to maintain or improve productivity, a robust justification is crucial due to the expenditure involved.Mining schedules form the basis of productivity and cost estimations for mining operations and therefore must have a significant level of confidence with regards to achievable quantities and rates. Traditionally, a mining schedule is produced without detailed consideration of the trucking capacity or requirements. Although some mine planning software incorporates haulage predictions into schedules, most cannot model the dynamic nature of dumping and haulage. Previous studies have shown that it is necessary to have detailed haulage analysis instead of the traditional mining block centroid to dump block centroid methods for more realistic mining schedules and cost estimation (Doig and Kizil, 2013).Recent developments in software have allowed the dynamic integration of haulage analysis with mining schedules. Engineers can now create mining schedules in conjunction with dumping schedules, allowing mining schedules to reflect the restrictions created by the number of available trucks, combined with dynamic consideration of available in-pit and out-of-pit dumping locations.A study has been completed producing a mining schedule in conjunction with a dumping schedule and haulage analysis. Multiple schedules were run with various haulage strategies (including minimising rehabilitation liability) and truck availability to identify the impacts on coal production, and hence revenue. A financial analysis was then completed where a net present value (NPV) was calculated for each scenario. The study showed that trucking shortfalls can significantly impact mining schedules and cost estimations, both in terms of cost as well as revenue lost when trucks cannot maintain forecast production rates, thus dumping schedules and haulage analysis should be completed simultaneously. If dumping and haulage is not considered when planning the mining schedule, a mining business is ignorant to the impacts trucking has on the mine production, closure risk and profitability.CITATION:Doig, P G, 2014. Value impacts of truck limited scheduling, in Proceedings Life-of-Mine 2014 , pp 513–524 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 16, 2014

By D Cooke

In 2010, Kalgoorlie Consolidated Gold Mines (KCGM) was Australia’s largest gold producer, with total annual production of 788 000 ounces. Of the gold produced by KCGM in 2010, 95 per cent was extracted from the Fimiston open pit, also known as the Superpit. The Fimiston operation encompasses the historic Golden Mile, from which more than 55 million ounces of gold have been extracted from the world-class Fimiston lode style mineralisation.The operational performance of the KCGM Fimiston open pit was reviewed for the period between 2005 and 2010. Key performance metrics reviewed included mined tonnes and grade, cost per ounce of gold produced and the mine to mill reconciliation trends. The years 2007 and 2008 were characterised by a decline in performance against key performance metrics. The ore zones were diluted, with the excess tonnes mined resulting in lower grade and an increase in the cost per ounce. Poor reconciliation between ore mined, the ore reserve model and the grade control polygons was also observed.A series of improvement initiatives were implemented in late 2008. As a result of changes made to the grade control and mining practices, the site performance recovered. Unplanned dilution was reduced, which had a positive impact on mined grade. The lower tonnes combined with higher grade reduced the cost per ounce to below budgeted levels in 2009 and 2010, enhancing the profitability of the operation. The operational performance between 2005 and 2010 was compared to the turnover statistics for the KCGM geology department over the same period. Turnover accelerated between 2005 and 2007, peaking at an annualised rate of 43 per cent. With the onset of the Global Financial Crisis and the implementation of retention initiatives, turnover reduced significantly between 2008 and 2010. A strong consistent correlation was observed between the turnover trends in geology and the performance of the grade control function and resultant site metrics.The cost of turnover is known intuitively, however, rarely quantified. To evaluate the benefit of the improved performance, a detailed financial model was used to quantify the impact of the grade control function. In 2010, the headgrade exceeding budget by just four per cent contributed an additional A$24 M of value to KCGM. In contrast, if the 2008 performance had been replicated in 2010 (-9 per cent on headgrade), the result would have removed A$61 M in value from the business. The KCGM experience between 2005 and 2010 demonstrates the value of human capital in a mining operation and the importance of a high performing geology grade control team to the profitability of a mining operation.

Aug 22, 2011

By C T. Senra, A Souza

Increasing fuel prices, unavailabilty and high prices of tyres have imposed tremendous challenges for large open pit operations. Carajßs open pit mines, one of the largest iron ore projects in the world, has been particularly affected due to the high amount of giant trucks operating in this site. On the other hand, environmental constraints push the mining industry towards reductions in fossil fuels, noise and waste generation. As a feasible response to these requirements, an alternative mining method for open pit mining, aiming to reduce or even eliminate the need for trucks has been developed, based primarily on coal opencast continuous operations. This innovative approach for open pits involves the replacement of trucks by fully-mobile crushers, bench conveyors and ramp conveyors. Two different applications have been developed for exploiting waste and ore at Carajßs largest pit, named N4E. To make it possible, mine planning paradigms should be replaced leading to new conceptual design of open pits. This paper shows two case studies (waste and ore conceptual design) carried out at Carajßs mines to anticipate and put forward the future of open pit mining, proving that our industry would be greatly affected by this new way of exploitation, reducing thousands of tons of fossil fuels. Productivities can be enhanced and environmental performance greatly improved. In this approach mine automation can be easily implemented reducing operating costs and man's fatigue.

Jan 1, 2009

By R Stimpson, B Johnson, B Hesse

During a period of twelve months between FY18-19, a series of trials were conducted to compare production drilling accuracy using two different methodologies, and the subsequent impact this had on stope performance (dilution and recovery). Testing was conducted at a series of underground mines in Australia. The drill rig’s existing alignment processes were compared to a new technology system, with the following observations: • The new technology was proven to limit rig alignment error, thereby reducing average blasthole deviation, resulting in an increase in the number of holes drilled within tolerance by up to 160%. • The increased accuracy reduced stope dilution significantly by reducing over-break of subgrade ore, whilst also increasing drilled meters (faster stope-cycle time), reducing the bridged tonnes ratio, and facilitating the capture of previously uneconomical stopes. A cost-benefit analysis extrapolated from each of the trials showed the extent to which the new technology, when applied to production data, reduced average dilution, increased ore recovery as well as general drill and blast productivity. In one such trial, the new technology was proven to have reduced average dilution by net 45.4%, which if applied to a full year’s production data, would result in AUD8.2M additional ore recovered, with AUD4.5M less spent on wasted cost of haulage and processing of diluted ore. As a result, return per tonne would increase 22%, from AUD87 to AUD106. This improvement was maintained over the following 12 months – reducing average dilution from 22% in FY17 to 12.1% in FY19.

Mar 15, 2021

By R K. A Taylor

The growth in production of beneficiated ilmenite products has been one of the most significant trends in the titanium feedstock industry over the past 30 years. In this period, the production of titanium slag and synthetic rutile has grown five-fold to the point where these products represented 56 per cent of total feedstock production in 2000. Additional production capacity is being proposed as the core component of new feedstock supply projects presently under consideration. A high proportion of these products is based on technologies for which the inherent quality of the is an essential factor. Location specific factors also play a large part in determining the cost of production. As the demand for such products grows, and the availability of favourably located sources of ilmenite of suitable quality declines, it can be expected that existing beneficiation technologies will become increasingly constrained. Existing beneficiation technologies, and those which have been developed, but are not yet commercially applied, are reviewed. Future issues which are likely to impact on the cost effectiveness of these technologies, or the quality of final products, are identified. These factors suggest directions for development of ilmenite beneficiation technologies to achieve economic production of the quality of feedstocks which will be demanded by the TiO2 pigment industry in the future.

Jan 1, 2001

Barrick Gold Granny Smith Mine is currently undergoing conversion from an open cut operation to an underground mine at the Wallaby deposit. The underground project commenced in 2005 with the development of the reserves immediately below the pit and is now currently entering a production ramp-up phase for mining of these two initial surfaces below the pit. With increasing gold prices the owner has been forced to re-evaluate the underground project and has decided to investigate the potential of a deep level mine. This deep level underground mine presents a collection of challenges with the most notable being exploitation of a series of well separated near horizontal lodes ranging in thickness from less than 1 to 20 m. A variety of room and pillar mining methods are employed for extraction with careful consideration to resource recovery and pillar design for long-term stability. Compounding these deep level challenges is a need to accelerate mine level development to maintain the production profile of the mine. This paper describes the challenges, key learnings and outcomes of the studies undertaken to date associated with this project.

Jan 1, 2008

By P K. Wong, D A. F Oliveira, F M. Azad

In situations where foundation piles are located in proximity to existing or future tunnels, it is typical for the tunnel owner to require that sleeving of the piles be carried out to at least the invert of the tunnels to minimise any load transfer to the tunnel lining. In competent rock, this practice may be sometimes unnecessary, thus uneconomical. This paper presents an assessment of the effect of pile loading from one of the multi-storey buildings at Barangaroo South in Sydney on the adjacent future Sydney Metro tunnels. It was originally required by Transport for NSW (TfNSW) that the piles be sleeved below the tunnel invert level; however, the building developer wanted to reduce the pile sleeving depth to achieve a more economical solution due to the large number of load transfer piles being required for the project. To assess this feasibility, a full 3D commercial numerical code, FLAC3D, was used to carry out this complex soil-structure interaction analyses. Based on these assessments, it was demonstrated successfully to the TfNSW that the pile sleeving may be terminated at 2 m above the tunnel invert level. For this arrangement, the investigations found that the loading on the piles should have negligible adverse impact on the tunnel lining design. As a result of such an assessment, the proposed pile sleeving level was approved by TfNSW, thus offering an economical foundation solution for the project.CITATION:Azad, F M, Oliveira, D A F and Wong, P K, 2014. The impact of pile loading on adjacent metro tunnels – Barangaroo South, Australia, in Proceedings 15th Australasian Tunnelling Conference 2014 , pp 355–360 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Sep 17, 2014

Crandallite and millisite in Christmas Island 'B' and 'C' phosphate ores are rapidly decomposed by sodium hydroxide solutions at about 80QC. As these phosphates generally contain less than 1% silica, an alkaline extraction process can be designed, in which up to 95% of the sodium hydroxide used, may be recycled. The insoluble residue consists of an impure, highly reactive apatite, which in pot trials, has given good responses as a direct application fertiliser; alternatively this residue can be underacidulated to give a granular product with fertiliser potential. The hot leaching solution contains up to 95% of the alumina and approx- imately half of the phosphate from the original ore. Simple crystallising techniques have been developed on a laboratory-scale to use this leaching solution for producing smelter-grade alumina and detergent-quality trisodium phosphate. As the demand for detergents is limited, an investigation was made of the reaction between trisodium phosphate and slaked lime, derived from a high-grade New Zealand limestone occurring near Oamaru. The product is calcium phosphate, containing up to 40% P205, and less than 0.2% each of iron, aluminium and fluorine, and it should be a useful raw material for phosphoric acid manufacture. A preliminary economic evaluation of the whole process looks promising, And warrants further investigations, including pilot-plant work.

Jan 1, 1971

By A Ross, B De Rivaz

The results of full-scale tests on precast segment made at University of Roma are presented. The segments were cast using fibre-reinforced concrete produced without any traditional reinforcement, by using fiber made in high-strength steel and a new type of anchorage.Bending tests were performed in order to check the bearing capacity of the segments under the flexural actions; these occur during de-moulding, handling, storage phases as well as in the in situ condition (due to asymmetric soil pressure). Furthermore, point load tests simulating the TBM thrust were performed, in order to study the construction phase (excavation).The results show that the segment response largely respects the material testing and design advice according to the Fib Model Code 2010. Providing engineers, precast operators and builders confidence in material strengths and design methodology.CITATION:De Rivaz, B and Ross, A, 2014. Full-scale tests on precast tunnel segments made in concrete reinforced with high-strength steel fibres, in Proceedings 15th Australasian Tunnelling Conference 2014 , pp 469–476 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Sep 17, 2014

By I C. Carrasco, V G. Mirada, J F. D Domingo, F S. Leite

This paper investigates ore loss and dilution produced by rock movement in bench blasting. A total of four blasts, in which electronic detonators have been used, were monitored in Cobre Las Cruces Open Pit Mine (FQM Ltd) in Gerena (Sevilla, Spain). Rock motion has been obtained in 137 points of the free face and 6 points inside the block. Multiple liner regression has been applied to predict rock motion and estimate ore dilution as a function of hole coordinates, rock contacts, powder factor/hole, amount of explosive per blasthole, burden, spacing, hole length, stemming length, explosive energy, hole row, subdrilling, blast sequence, stiffness ratio, blasthole distance to free face, rock density and Young’s modulus. The model is statistically significant with a determination coefficient over 0.8. Rock motion measurements in 31 more points have been used to validate the model and to show a reduction in ore dilution.CITATION:Domingo, J F D, Leite, F S, Mirada, V G and Carrasco, I C, 2015. Dilution, ore grade and blast movement calculation model, in Proceedings 11th International Symposium on Rock Fragmentation by Blasting, pp 71–78 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Aug 24, 2015

By L Köresaar, J Moilanen

With lower and increasingly variable Fe grades in iron ore resources, the monitoring of Si, Al, Mg and other light elements to meet quality requirements is gaining importance in the iron ore beneficiation industry. The high cost per manual assay and associated manpower requirements often limit the frequency of shift composite samples and laboratory assays. Furthermore, the shift composite assays represent past performance of a plant but are not useful for immediate reactions to feed variations, detection of equipment malfunctions or process control. Automated online analysis of light elements radically reduces the cost per assay and provides repeatable, timely data for process analysis, control and optimisation.A light element online slurry analyser, based on laser-induced breakdown spectroscopy (LIBS) optical emission technique, will be presented. This paper discusses the analyser design for the iron ore industry and also reviews the performance of the analyser against the manual laboratory. Additionally operator safety, user friendliness and maintenance requirements are discussed.A case study will also be discussed in this paper. The sophisticated measurement technique has been implemented in an industrial automated analyser and sampling system to allow for slurry measurement for up to 12 sampling points. However, careful selection of the sampling points and implementation of the sampling system is required for smooth operation.CITATION:Köresaar, L, Timperi, J and Moilanen, J, 2015. Optimised process control in iron ore via online analysis of light elements, in Proceedings Iron Ore 2015, pp 511–518 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 13, 2015

By M Brady, O Salisbury, C Claassen, B Beamish, H Baxter

Monitoring for signs of elevated spontaneous combustion in the active goaf behind the longwall face is crucial for early intervention of any potential heating incidents. Typically, trigger action response plans (TARPs) are established at the start of longwall mining and often are only reviewed when triggers are activated frequently and become ‘nuisance alarms’, or in the worst case scenario after a heating event. Narrabri Mine has adopted a proactive approach of reviewing the longwall active goaf spontaneous combustion monitoring TARP at the commencement of each longwall block and prior to reaching a known ‘mylonite zone’ of crushed coal, which is associated with increased coal oxidation. The review is based on information recorded from the monitoring data of the previous longwall blocks as well as interpretation of relevant spontaneous combustion propensity results for the coal. This has resulted in the mine implementing a zoned TARP approach for each longwall block covering both the longwall retreat through normal undisturbed coal and the zone where the goaf is influenced by the increased coal oxidation associated with the mylonite coal. The consequence of this approach is that it has removed the issue of having nuisance triggers being activated during mining through a known increased oxidation zone, while maintaining a high awareness of indicators of spontaneous combustion.CITATION:Baxter, H, Claassen, C, Salisbury, O, Brady, M and Beamish, B, 2015. Implementation of a zoned trigger action response plan associated with changing mine conditions at Narrabri Mine, in Proceedings The Australian Mine Ventilation Conference, pp 113–120 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Aug 31, 2015

By A B. Jahed, Ö Aydan, T Ito

In this study, the authors compiled some case history data and present some typical examples of rock slope stability issues in Afghanistan with a special emphasis on Kandahar region and categorise rock slope failures according to the principles of modern rock slope engineering. The slopes considered involve rock-cut, natural rock slopes mainly. The effect of structural geology and discontinuous nature of rock mass on both slope-cuts and natural rock slopes is taken into account and some preliminary assessments on the stable and unstable rock slopes are presented. Furthermore, the seismic effect on their stability is also considered. It is also pointed out that similar issues could be observed in open pit mines, which may be exploited in years to come.

Nov 29, 2022

By M Chen, Q D. Gao, Y G. Hu, P Yan, W B. Lu

The safety and stability of construction structures are often affected by blast-induced waves. Investigating the generation mechanism of shear wave (S-wave) during blasting is important, because it has a strong effect in blasting damage. In this paper the generation mechanism and verification of S-wave was studied analytically and numerically. Under the finite velocity of detonation (VOD) of cylindrical charge or the compression wave (P-wave) communicating with the interface of different media during the propagation, the generation mechanism of S-wave was analysed. Propagation of blasting wave in cylindrical charge was simulated with the elastic model, and the generation of S-wave induced by finite VOD was proved. To compare with different numerical methods in simulating the generation of S-wave, the blasting process of instantaneous detonation was simulated by using the elastic model, elastic-plastic model and smoothed particle hydrodynamics and finite element method (SPH-FEM) coupled model. Results demonstrate that the S-wave could not be found in middle section of the charge if the elastic model is employed. But when using elastic-plastic model and SPH-FEM coupled model, the generation of S-wave could be verified. Under the SPH-FEM condition, the amplitude of S-wave is larger and the arrival time difference between P-wave and S-wave is closer to theoretical results.CITATION:Gao, Q D, Lu, W B, Hu, Y G, Chen, M and Yan, P, 2015. Comparison of the generation of shear wave with different simulation approaches, in Proceedings 11th International Symposium on Rock Fragmentation by Blasting, pp 79–88 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Aug 24, 2015

By E Lima, D Gregory, C Faria, A Lapworth

Open pit mine enterprises are complex systems that depend on multiple parameters such as mineral grade distribution, geotechnical characteristics, economic conditions and engineering requirements, all of which vary in time and space with a different degree of uncertainty. The unpredictable nature of these inputs imposes a risk to mine owners and shareholders which in the worst case can lead to highly undesirable financial outcomes.Desktop studies commonly examine a set of scenarios based on adjusting variables such as commodity prices, mining costs, processing costs, and metal recoveries to understand their relative impact on the economics of a project. It is less common to systematically explore and simulate hundreds of alternative physical designs to understand and compare the financial risk associated with one or more mining projects.This paper presents a risk assessment tool set and methodology that uses web based cloud computing to enable multiple simulations of mine designs to be rapidly and efficiently executed. The methodology includes generating random sets of prices and costs values within their respective probability distributions. Pit designs are then created to maximise the profit for each set of input variables. Various approaches to analysing the results are discussed. Use of the same high performance computing environment for understanding the financial risk associated with the variability of the underlying geological resource model is also discussed, with provided examples using case studies from two of the major mineral producers.CITATION:Lima, E, Gregory, D, Lapworth, A and Faria, C, 2014. Simulating extraction shapes to understand financial risk using high performance computing, in Proceedings Orebody Modelling and Strategic Mine Planning Symposium 2014 , pp 351–360 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Nov 24, 2014

By R Razanatsimba, A Galli

A mining company has entered into contractual commitments to supply certain quantities of its product to clients in each time period. Failure to fulfil its obligations would damage its reputation as a reliable supplier. The planned production would normally be sufficient unless major problems such as highwall failures, roof falls, natural disaster, or strikes that interrupt production or delays in obtaining environmental permits, occur. To overcome these difficulties, the company may be able to obtain more of the commodity: from its strategic stockpile (if there is sufficient there); by buying it on the spot market; or for some commodities such as gold and uranium, by leasing it. Two sources of uncertainty, the spot price of the commodity and the occurrence of serious incidents that interrupt production, are considered. For simplicity it is assumed that the commodity price follows a geometric Brownian motion, that productions incidents have a binomial distribution, that they are independent from one time period to another and that they do not affect prices. A branching tree structure is used to model the joint evolution of prices and production incidents. The aim of this research project was to evaluate the companyÆs options for fulfilling its contractual commitments. When evaluating these options, multi-stage stochastic programming with recourse was used to solve this problem because in addition to providing the dollar value of the project, it gives decision-makers the æroadmapÆ to reach the optimal value. That is, how much material should be bought/sold on the spot market, how much to add to/subtract from the stockpile, how much to lease and in the worst case what the shortfall would be, for each time period as a function of the current spot price and breakdown status. A case-study over a five-year period is used to illustrate the proposed procedure. In this study the production would be sufficient to cover the companyÆs contractual commitments unless production incidents occur. Focus is on evaluating the impact of the quantity initially in the stockpile on the value of the project when the commodity market is tight, that is, when only small quantities can be bought on the spot market or by leasing.

Sep 26, 2011