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By Y. Fu, C. Aldrich

This study investigates the use of dense convolutional neural networks to estimate bubble size distributions in flotation froths. 20 videographically captured images of froths from an industrial platinum flotation plant in South Africa were labelled semantically with an image annotation tool, LabelMe (https://github.com/wkentaro/labelme). As a result, pixels in the images could be categorized into three classes, namely ‘bubbles’ (class 0), ‘bubble boundaries’ (class 1) and ‘background’ (class 2). A U-net architecture with a ResNet34 backbone was trained to segment the images via classification of the pixels in the images. 5 of the 20 images were used to validate the performance of the neural network. Explicit inclusion of the bubble boundaries as a class proved to be significantly more effective than training the network with two classes only (i.e. bubbles and background). However, the thickness of the boundary layer regions were critical. If too thin, it was difficult to distinguish between some contiguous bubbles and if too thick, some fine bubbles may not be identified. The results were promising, although there is still significant scope for improvement, among other by making use of more images for training and validation. Keywords: Flotation Froths, Convolutional Neural Networks, Deep Learning, Bubble size Analysis

Jan 1, 2020

By A. Tekin

In almost all branches of industry, machinery and equipment in operation cause vibration. Some sources of vibration affect only the operator’s hands, fingers, and arms, while others have adverse effects on the entire -body. Various types and numbers of machines are utilized in the mining sector, and operators with them are exposed to mechanical vibrations caused by the mining machinery they use. A field study was conducted to evaluate the vibration risks to the operators using mining machines in open pit mines. Vibration levels and whole-body vibration (WBV) measurements using various types brands, and models of construction equipment were evaluated in three different mines in the west of Turkey and compared to the the criteria specified in the EU 2002/44/EC directive and ISO 2631-1 (1997) standards. The results showed that operators using mining machinery for 8 hours were exposed to WBV levels below the EU limit (1.15 m/s2), while 44% of these operators were exposed to levels above the EU action limit (0.5 m/s2). Measurement data collected from the working environment and the recommended improvements that need to be made to reduce WBV exposures are presented.

May 2, 2022

By E. Öğretici, S. Kahraman

The indirect estimation of intact rock properties is particularly useful for preliminary investigations in engineering projects. In this paper we examine the usability of electrical resistivity, a nondestructive measurement, for the prediction of physical and mechanical rock characteristics. Physico-mechanical tests (uniaxial compression, Brazilian tensile, density, and porosity tests) and electrical resistivity measurements were performed on specimens of 36 rock types. Before the resistivity tests, the specimens were completely saturated with saline solution. Evaluation of the test results showed that there are medium or strong correlations between resistivity and rock properties. There are also strong or stronger correlations between the two parameters for the rock classes. The regression equations developed were statistically tested, and their validity was confirmed. The results were also compared with previous studies. The conclusion is that electrical resistivity measurement can be used for reliably estimating physical and mechanical rock characteristics.

Aug 8, 2024

By A. F. Lee

Dr E. C. Hanekom (Visitor): Two years ago we used the bubble pick-up technique as developed at Anglo American Corporation for screening candidate flotation agents prepared in our laboratories. It was obviously necessary to know to what extent the technique gave reproducible results and a statistical evaluation of the test method was made using a mineral sample provided by Anglo American Corporation. A bubble of 2.0 mm diameter was used and the measuring graticule was divided into squares (units) with sides of 5.0 mm at 25 X magnification. The mineral granules had diameters from 53 to 74 mm. The bubble was loaded by depressing it against a layer of mineral grains to give an arbitrary but constant compression of 0.4-0.5 mm. It was rolled five times through 2 mm horizontal displacement. The bubble was then lifted, its load compacted by gently stirring and the projected area measured in squares (units) on the grid. Each substance was tested at 5 ppm concentration in distilled water at five points in the pH range 3-6. With these standardized conditions of operation the reproducibility of the test was studied. Four materials were tested and at each pH value the procedure of forming a bubble, picking up granules and counting the units was repeated ten times. From these results the standard deviation for a single count at any pH value was calculated for each material (Table 1. The coefficient of variation of approximately 3 per cent was relatively low and it was decided that further refinements in the counting procedure would be of doubtful benefit with the present apparatus. Similar experiments were carried out with 12 sample materials. In this case the bubble formation and pick-up were repeated four times at each pH value, the mean value was calculated for each set of four observations and final pick-up values for the materials were obtained by selecting the highest mean count. Each test was completely repeated a number of times as indicated in Table 2 and the standard deviation calculated. The results allowed the selection of the more promising materials and the rejection of poor performers at the 95 per cent confidence level. All tests were carried out by one operator. Some evidence was obtained that the method is sensitive to operator bias. In conclusion it can be said that from all the results analyzed it would appear that once operation conditions are fixed (viz operator, pH control) the precision of the method is adequate. The author wishes to thank Messrs African Explosives and Chemical Industries Limited for permission to publish these data. G. S. Stander and C. J. Kooij (Visitors): We must congratulate Mr Lee for this most interesting and useful development of the pick-up experimental method. It certainly provides research workers with an instrument which makes flotation more of a science and less of an art. We visited Mr Lee at his laboratory where he gave us a demonstration of the bubble pick-up instrument and technique as developed and improved by him.

Jan 12, 1969

By S-J. Park

When evaluating mining investment opportunities, one should consider the risks associated with mineral exploration and development. These are commonly classified as technical, economic, and political risks, and are accounted for in the investment decision by changing the discount rate. Thus, a company may use different discount rates associated with varying risks in order to compensate for the variability of success. The discount rate has a tremendous effect on the economic evaluation of mineral projects. Even when all other factors used as inputs for calculating the NPV (net present value) are equal, the project under consideration may be accepted or rejected depending upon the discount rate. Determining a realistic discount rate for a given project is therefore the most difficult and important aspect of cash flow analysis. It should be determined with the consideration of proper technical, economic, and political conditions surrounding the specific project undergoing economic evaluation. One key problem for determining the appropriate discount rate is that it typically depends more on subjective perception of the degree of risk or other experience factors than on a systematic approach. Thus, this study aims to identify, analyse, and document the type, role, and impact of risk factors influencing the determination of discount rates, and then to determine discount rate by using the aforementioned factors.

Jan 1, 2011

By S. Banisi, A. Ghasemi, A. Fazeli, M. Rezaei, M. Maleki-Moghaddam

The efficiency of high capacity SAG mills which consume large amounts of energy depends on the grinding and slurry discharge systems. A 9.7 m × 4.8 m SAG mill with radial pulp lifters is used at the Sarcheshmeh copper complex grinding circuit. The process audit indicated that the pulp discharge system was not efficient, judging by the amount of slurry flow back and carry over. These events limited the discharge rate and increased the wear rate of the lifters and grates. With the objective of finding a new design for pulp lifters, a 3D DEM software (KMPCDEM ©), along with the plant operational data and photographic evidence was used. The KMPCDEM © software was used to compare the efficiency of the radial and curved pulp lifter design based on the material flow. The slurry flow was analysed in terms of ease of discharge and lifter wear rate. It was found that changing the radial pulp lifters to curved pulp lifters could improve the discharge efficiency,and decrease wear rate of the pulp lifter in particular at the base of the pulp lifters. The simulation results showed that if curved lifters with a radius of 0.3×mill radius are used, the amount of slurry flow back and carry over will be negligible. It is predicted that by installing the curved pulp lifters, the capacity of the mill increases by 10% and the pulp lifter service life improves by at least 20%. Keywords: SAG mill, radial pulp lifter, DEM,curved pulp lifter, Sarcheshmeh

Jan 1, 2020

The October General Meeting of the Institute was held in Kelvin House, Johannesburg, on 15th October, 1969, at 4.30 p.m. Mr J. K. E. Douglas (President) was in the Chair. There were also present 17 Members, Messrs: M. Barcza, R. C. J. Goode, J. A. Nixon and V. C. Robinson (Council Members), M. L. Fitzgerald, D. F. H. Graves, C. G. Hinds, S. D. Hill, J. S. Hall, D. F. Malan, T. Meyer, W. pyne-Mercier, K. S. Rae, S. G. Taussig, L. W. P. van den Bosch, Dr A. Whillier, C. H. Wyndham. Four Associate Members: Messrs O. Davel, M. J. Martinson, M. P. J. Sandys, T. G. Harington. One Student: R. P. W. Henrard. Three Visitors: Messrs A. V. Pike, B. Schmitz, A. P. Raats. Secretaries: D. C. Visser and S. de. Gersigny. Total present: Twenty-eight. OBITUARY The President: "It is my said duty to announce the death of Pieter Ulrich Fischer, Member, who joined the Institute in 1961 and passed away on 24th June, 1969. As a mark of respect to the memory of the deceased and in sympathy with the bereaved I would ask you all to rise and observe a few moments' silence." MINUTES The President: "The minutes of the last meeting will only appear in next month's Journal and I would request that the confirmation of these minutes be held over." MEMBERSHIP The President: "I have much pleasure in announcing that the names of the undermentioned candidates, having been published in accordance with By-Law 5.2.2, Council has elected them to membership of the Institute in the following grades:" Members: Alexander Edward O'Meara, Anton Leopold Melvill, WilIiam Harold Wise, Eric John Dunstan, Frank Nel, Lubertus Hendrikus Jakob Poortier. Associate Members: Michael Irvine Britten, Selwyn Wilson Lange. James McCormack, Christiaan Lodewyk de Jongh, WilIiam Andrew Hustrulid, Reinhold Johannes Ortlepp, Felix Henry Lancaster. Graduates: Willem Adriaan Gericke, Hamish David Sneddon Miller, David lan Ossin, Robert Antony Layboume, Ewart John Shillaber, Colin Hewitt Wiggett. Affiliates: Bernard Andre Thomas, Waiter Arthur Wood, Andrew John George Paschalides, David John Perry, Alex Richardson, Gert Blekker Kotze. Student: Matthys Jacobus de Beer. MEMBERS TRANSFERRED TO A HIGHER GRADE From Associate Member to Member: David Alphonso Viljoen. From Student to Associate Member: Michael Charles Carruthers. "I welcome the newly elected members to the Institute and congratulate the members who have been transferred to a higher grade." PAPERS FOR PRESENTATION The President: "Professor Wyndham, may I call on you to deliver the paper entitled 'Factors affecting the mechanical efficiency of men shovelling rock in stopes', written jointly with J. F. Morrison, J. H. Viljoen, N. B. Strydom and A. Heyns." After the presentation of the paper the President said: "Gentlemen, I would like to thank Dr Wyndham and his colleagues for once again reporting through the medium of this Institute the results of the very important work they are carrying out at the Human Science Laboratories. It is most appropriate that this work which is leading to a better understanding of the capabilities and efficiency of the human body under the arduous conditions encountered underground should be reported to this forum. In this way our members, who are actively engaged in the job of mining, can firstly learn something of this research and secondly, can, with their practical knowledge of conditions underground, contribute to what has been learnt and possibly pose new problems for our scientists in the laboratories. The scientist should always have the opportunity of subjecting his research to the scrutiny of people engaged in practical operations. By the very nature of our gold mines we are unfortunately heavily dependent on a large labour force and while mechanization has been introduced wherever feasible, we are likely to continue to be heavily dependent on this labour. In accepting this fact we can be proud in this country of what has been achieved, not only in obtaining the best efficiency from labour but in ensuring that their working conditions are reasonable and that their health and well-being are adequately cared for. When one visits our gold mines, one cannot help being impressed with what is being done to ensure that we have a satisfied, happy and healthy labour force. The Human Sciences Laboratory with its scientific approach has assisted greatly in promoting a better understanding of the problems associated with labour under the conditions experienced on our mines. Thank you." Mr M. Martinson then contributed to the discussion. (This contribution will appear in a later issue of the Journal.) "Professor Wyndham, may I call on you to deliver the paper entitled 'Acclimatizing men to heat in climatic rooms on mines,' written jointly with Prof Strydom." After Dr Wyndham had presented the paper the President said: "Thank you Dr Wyndham for so ably describing the work associated with the acclimatization procedures on our gold mines. It has certainly been an eye-opener to those of us not familiar with this work and I believe it is very important that everyone and not only people in the gold mines should know about it. It is fortunate that all industries do not have the same arduous heat conditions experienced on our mines but other industries such as our chemical and metallurgical industries do have other problems relating to the adjustment of labour to the work situation. The scientific approach employed by the gold mines in tackling this problem is an example to these industries of what can be achieved by logical

By B. Hart, B. K. Gorain, A. Chattopadhyay, S. Dimovc

This paper presents a detailed and systematic approach to metallurgy diagnostics using an integrated novel gold deportment technique for complex copper-gold and refractory gold ore bodies. This uantitative gold deportment for these complex ore bodies is a challenging task due to reasons such as lower grades, high variability of visible and invisible gold content in different sulphides and iron oxide phases, significant presence of disseminated and composite carbonaceous matters along with associations of various copper sulphide phases. Gold mostly occurs as "invisible gold" (sub-microscopic gold) as solid solution or as colloidal-sized particles in different sulphides and other phases. The dominance of invisible gold and presence of highly preg-robbing and finely disseminated carbonaceous matter adversely affects gold recovery in flotation and leach circuits. Studies were initiated on various complex ore deposits and also on samples representing various process streams. Some case studies are presented in this paper to demonstrate the value of a high confidence gold deportment methodology in developing insights for problem diagnostics and to identify opportunities for metallurgical improvements. A systematic and holistic approach involving different fields of expertise is critical for successful development and delivery of solutions for complex ore bodies. Keywords: Integrated gold deportment, complex copper-gold ores, double refractory gold ores, carbonaceous matter, diagnostic metallurgy, preg-robbed surface gold

Jan 1, 2020

By A. E. Voigt

Iron ore samples representing the input and output of several jigging experiments were analysed to determine the effect of particle size, shape, and density on jigging performance. Traditionally, the manual measurement of the size and shape of individual particles is very tedious and prone to inaccuracies and inconsistencies. Using a novel multi-view imaging technique the 3-dimensional representations of each particle in the sample was determined. From this representation several size and shape measurements were extracted, and these were correlated with the individual particle density measurements. A rigorous investigation into the confidence associated with density and the size and shape features as a function of sample size was conducted, thus allowing the significance of correlations in the data to be determined. The jig?s performance was seen to be clearly sensitive to density and markedly so to particle size, while the results for shape indicated the need for continued work in the definition of particle shape.

Jan 1, 2012

By T. Nyakudarika

The Unki Platinum Mines concentrator, employing an MF2 circuit configuration which includes fully-autogenous primary milling of run-of-mine (ROM) ore, was commissioned in November 2010. The project was Anglo American Platinum?s first PGM concentrator in Zimbabwe and would form a significant contribution to the group?s platinum production. The project financials demonstrated that the project was operating-cost sensitive. After reviewing the metallurgical testwork, mineralogical examinations, and the history of similar operations, it became apparent that the Unki ore characteristics rendered it amenable to autogenous milling. The primary ball mill, structurally designed for 30 per cent steel load, could be operated at the required initial phase throughput with fully-autogenous primary milling, realizing savings in both power requirements and grinding media consumption. The original mill sizing had been done with fully-autogenous milling in mind, but allowing for flexibility and mitigation in case of varied mining fragmentation. Since attaining steady state, target grinds have been achieved. This paper looks at the Unki ore characterization programme, design considerations, and the operational and control philosophy for a successful comminution circuit, and discusses the design to produce a flexible, low opex, mitigated comminution and overall MF2 flowsheet that is easily expanded in line with the potential for optimum exploitation of the orebody.

Jan 1, 2012

By P. Ramsaywok, G. Legodi

Spiral concentrators are widely used in the coal industry treating fine (-1mm) coal. Their application was a limitation to the product quality until the introduction of low-cut spirals which allow a lower quality ash product to be produced, thus expanding the market. The Exxaro Grootegeluk 1 (GG1) plant has a two-stage traditional rougher-cleaner spiral circuit using conventional SX4 spirals to produce semi-soft coking coal product at 12.5% ash by mass. The overall plant product is 10.3% ash meaning that the coarser sized coal dense medium separation circuits must compensate. A low density cut-point spiral targetting 10.3% ash would thus be beneficial to the overall complex. The spirals were tested in the two-stage plant environment and in a pilot plant. This paper discusses the findings and compares a two stage four-turn low density cut and conventional spiral. The two spiral technologies were unable to sustain a 10.3% ash product. Pilot test work was also conducted on GG1 coal, demonstrating that an eight-turn low density cut-point spiral achieves the targetted 10.3% ash under controlled conditions. Keywords: Spiral, low-cut, coal

Jan 1, 2020

By A. S. Ratnayake, H. C. S. Subasinghe

In this study, we review the role of mechanical activation in the pyrometallurgical, hydrometallurgical, and electrometallurgical processing of titanium feedstock. Mechanical activation has been shown to decrease the activation energy of chemical reactions, thus enhancing process efficiency and product quality by reducing processing time and energy consumption. Pyrometallurgical processing is energy-intensive and time-consuming. Hydrometallurgy is costly, requires high-grade feed material, and generates toxic waste. Waste generation and process complexity are the major drawbacks of electrometallurgy and solvent extraction. Bioleaching via a mechanically activated pyrometallurgical process can be identified as an alternative method, but the lengthy processing time is the major disadvantage. Mechanically activated titanium concentrate can be used in a finely tuned combined metallurgical process to overcome the challenges and drawbacks in these technologies.

Aug 3, 2023

By P. Saayman

The mining industry has much potential for automation. A great deal of work has been done on this subject and is still ongoing. With automation comes the possibility for optimization, because more information is available and actions can be repeated with more accuracy. This paper looks at possible solutions to the problem of optimizing the autonomous vehicle dispatch system in an underground mine. Possible optimization strategies are evaluated using a simulated environment. The majority of the results indicate that improvements on current methods are possible. Keywords: mining automation, simulation, vehicles, dispatching strategy, optimization.

Jan 1, 2006

By R. H. Matjie, J. R. Bunt, A. C. Collins, J. C. van Dyk, C. A. Strydom

South African coal discards derived from feed coal for thermoprocesses pose human health and environmental problems and incur high disposal costs. These issues need to be resolved. Coal fines and a coal fines/ K2CO3 blend were combusted at 700°C in a laboratory rotary kiln to produce ashes containing metakaolinite (Al2O3.2SiO2) and illite/muscovite/orthoclase amorphous materials. The blend ash and coal fines ash, containing 18% K2O and <1% K2O respectively, were leached with water and with 1 M and 8 M NaOH at 80°C for 4 hours using a solid to liquid ratio of 1:5. The 8 M NaOH leach yielded 17% sodalite (Na8Si6Al6O24(OH)2) formation through SiO32-, Al(OH)4-, and Na+ precipitation in the leached ashes. The 1 M NaOH leach yielded no sodalite. X-ray fluorescence analysis of the original ashes and leached ashes showed low Al and Si dissolution efficiencies due to the sodalite formation. Sequential NaOH leaching resulted in the highest potassium dissolution efficiency of 89% for the ashes of fines/K2CO3 blend and 59% for the fines. It may be possible to increase the ash-derived zeolite concentration by using even higher NaOH concentrations (12–20 M NaOH) during leaching. Sodalite derived from coal ash could possibly be utilized for water purification in industrial applications, or as molecule separators. The potassium-containing liquid could be used in fertilizer manufacture.

Mar 30, 2023

By R. L. Machunda, A. M. Rugaika, D. D. Mdachi

Sedimentary and igneous rocks are the two primary sources of phosphate that are mined and beneficiated to fertilizer. During the beneficiation process, phosphate is lost into the tailings. We investigated phosphate concentrations in tailings dumps at Minjingu mine, Tanzania using energy-dispersive X-ray fluorescence spectrometry to quantify the chemical compositions. The phosphate content in the tailings varied from 12.91% phosphorus pentoxide (P2O5) in Tailings 2 to 19.61% in Tailings Dump 1. The naturally occurring phosphate concentration in rocks ranges from 3% to 35%, and phosphate tailings from various locations with P2O5 concentrations as low as 6.46-12.65% have been beneficiated to commercial fertilizer. Our investigation revealed that phosphate concentrations in Minjingu tailings may be sufficient to be recovered for commercial applications. Suitable recovery methods are discussed, and we recommend that beneficiation should be performed to minimize the loss of phosphate into tailings. Further research is needed to identify the optimal beneficiation methodology.

Aug 8, 2024

Plurigaussian simulation allows constructing lithofacies or rock type models that reproduce the contacts between facies in accordance with the geologist?s interpretation. Its implementation requires inferring the local facies proportions, but the uncertainty in the true proportions is not accounted for. The simpler model with constant facies proportions may not yield realistic results, due to the possibility of obtaining facies at locations where it is geologically unlikely to find them. This article presents a variation of the plurigaussian model, in which the facies proportions are represented by random fields. The realizations can be made conditional to soft geological informati onto account for local changes in the facies proportions. The model is illustrated via a case study of a porphyry copper deposit where four Gaussian random fields are simulated conditionally to drill hole data and to constraints on the probability of finding a given facies at specific locations (control points) in the deposit. Then the first two fields are truncated using the random thresholds defined by the last two, generating a three-facies model. The proposed random proportion model proves to be simple to use and to account for spatial variations of the geological characteristics and for the uncertainty in the facies proportions. Keywords: categorical variable; lithofacies; truncated plurigaussian simulation; regionalized proportions

Jan 1, 2008

By I. Ngo, L. Q. Ma, J. S. Guo

Deformation of gob-side entries has always been a critical concern for ensuring stability in longwall coal mines. This paper addresses the significant deformation and support challenges that arise in thick and hard roof longwall faces (THRLF) due to dynamic pressure. The study aims to elucidate the characteristics and mechanisms of deformation during the retreat of the longwall face. The research findings indicated that the primary cause of deformation was the combination of advanced abutment stress resulting from longwall face mining and the movement of the lateral roof over the chain pillar. To mitigate this issue, we propose a deformation control method known as cutting off the lateral roof (COLR) over the chain pillar. Simulation results demonstrate a significant reduction in roof stress and deformation of the gob-side entry after implementing the lateral roof-cutting technique. These findings provide valuable guidance for effectively managing deformation in gob-side entries, particularly when dealing with thick and hard roof strata.

Aug 3, 2023

By C. H. Wyndham, N. B. Strydom

Discussion C. G. Hinds (Member): The climatic chamber at Kloof Gold Mine was built to the design referred to in the paper presented by Professor Wyndham and Dr Strydom. As no suitable underground facilities existed for the acclimatization of labourers at the rate required, mining operations would have been severely restricted had there not been a climatic room timeously built on surface. The climatic room can accommodate 120 labourers per 4-!-hour shift. The standards laid down by the Human Sciences Laboratory were and still are being adhered to as strictly as possible. Through a shortage of European personnel the recommended degree of white supervision could not be adhered to and the use of Bantu assistants with a minimum education of Standard 8 was introduced. This is considered to have met with sufficient success to warrant acceptance as policy. The climatic room was brought into operation on the 1st September, 1967, i.e. two months after stoping at Kloof was commenced. The figures quoted herein therefore pertain to the period between that date and the 31st March, 1969, when the main shaft and the main surface fans were commissioned. The areas worked were sited between 5016 ft and 6 365 ft below surface. Virgin rock temperatures ranged between 92°F and 99°F. Stopes are cleaned by hand lashing. During the 20 months of stoping prior to the commissioning of the main shaft, mining operations at Kloof were effected through the Harvie Watt shaft of the Libanon Gold Mining Company Limited. In this period 10 452 Bantu labourers were acclimatized in the following categories: Experienced workers 7 326 New to the industry 2 086 Re-acclimatized 1 040 It will be noted that during the period, labourers &apos;new to the industry&apos; averaged 22 per cent of the intake. This percentage fluctuated from time to time and reached 42 per cent. (The present percentage is 60.) The greatest number acclimatized during anyone month occurred in February, 1969 when 1234 Bantu were treated. The greatest number of Bantu acclimatized during any 8-day period was 411. As many as four X 41/2 hour shifts were run in 24 hours. The number of men found to be heat intolerant over the period of 20 months was 33 out of a total 9 412 Bantu. The following tabulation illustrates the history of the build-up of manpower and the climatic conditions under which they worked: The average dip of the reef is 35°. The number of heat stroke and heat exhaustion cases during the period of 20 months under most difficult ventilation conditions was Nil.

Jan 10, 1969

By M. Rossouw

The paper sets out the strategic importance of South Africa?s mining and minerals sector to the national economy. It relates how inexorable and accelerating urbanization and industrialization in emerging markets, especially in China and India, will translate into sustained demand for the minerals that South and southern Africa have in abundance. It warns that while countries buying raw materials from South Africa use these inputs as the basis on which to build value-added, employment-creating industries, South Africa is failing to exploit the economic benefits inherent in its mineral wealth, exacerbating its shortage of skills.

Jan 1, 2011

By C. Birch

"The purpose of this study was to establish the impact of discount rates on cut-off grades for narrow tabular gold deposits as characterized by the goldfields of the Witwatersrand Basin in South Africa. There are various methods available for determining the cut-off grade, from simple breakeven calculations to sophisticated software packages that consider a variety of inputs to optimize the cut-off grade. For this study a simple financial model was created in Microsoft Excel® that links the ore flow, block listing, and the cash flow. This allows the cut-off grade to be optimized considering how the cost of capital and chosen discount rate affect the cash flow.The discounted cash flow (DCF) and resultant net present value (NPV) are a widely used valuation method for production properties according to the South African Code for the Reporting of Mineral Asset Valuation (SAMVAL Code). The financial model in this study utilizes the Solver function, as well as simple Microsoft Excel spreadsheet formulae to optimize the NPV. Solver was chosen as it is a standard feature in Excel and thus no additional software costs are incurred beyond the basic Microsoft Office suite. For the purpose of this study, just narrow tabular gold deposits of the Witwatersrand Basin were considered. An example of a typical ore block listing, as well as the costing figures, was obtained from an operating gold mine. The results obtained from the study financial model were compared to the current cut-off grades obtained from the mine using their proprietary optimizer program, and were found to be comparable. The methodology utilized for this study thus appears valid.The cut-off grade was optimized considering the cash flow, which includes the variable mineral resource royalty tax, the variable gold income tax, as well as the discount rate. By comparing the resultant NPVs using discount rates of zero, 9%, and 12%, the impact of the discount rate on cut-off grades, resultant life of mine, and average mining grades (AMG) could be compared for the example ore block listing. The South African Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves (SAMREC Code) does not require operations to state if a discount rate was considered in determining mineable reserves. Mining companies approach the question of applying discount rates in determining their cut-off grades, and thus mine planning strategy, in different ways. Due to the negative impact that optimizing purely on NPV has on the life of mine, some choose to optimize only on profit. Other companies have reverted to utilizing pay limits as their primary grade planning strategy. The calculated cut-off grade is then considered to be another planning indicator rather than a hard determination of mineable reserves."

Jan 1, 2016