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By C. Nangolo

Mineral commodity prices comprise one of the key criteria in the selection of mining stocks. We contend that of the three principal elements of mineral commodity prices, spot price, forward price and long-term price, one has a greater impact on the share valuation processes used by investors. This research paper examines the extent to which each of these elements influences the valuation process. The intention is to provide investors in mining stocks with a greater understanding of how fluctuations of commodity prices over time affect the prices of the mining stocks they hold, or intend to sell or buy. Three mineral commodities, gold, silver, and copper, were used as case studies, since market data on these commodities is readily available in the public domain. Nine market indices covering all three mineral commodities were selected. These are based on clearly defined criteria with the intention of eliminating ambiguity and to test for correlation with the three sets of mineral commodity prices. Nine mining companies, which were not the primary drivers of the relevant indices employed in the study, were used to validate the results obtained from the indices in order to avoid duplication of the same correlation during cross-checking. Each commodity price was adjusted for operating costs. For each market index, an average operating cost was calculated from the companies comprising its basket, while each company?s annual operating costs were used for the stocks of the individual companies examined. The data was collected for the period January 2004 to October 2010. This period was further split up into three sub-periods to account for the Global Financial Crisis (GFC) period that started in mid-2008. We conclude that mining stock prices are correlated with mineral commodity prices, but with spot and forward prices exhibiting stronger correlations than long-term price. This finding should be useful for evaluation purposes. Where cash flow methodologies such as discounted cash flow or earnings per share are used to value ordinary shares and commodity prices are required to estimate future cash flows, the findings suggest that spot prices should be used as opposed to long-term prices. The work reported in this paper is part of a current MSc research study at the University of the Witwatersrand.

Jan 1, 2011

By A. Pytlik, W. Masny

"Underground mining is subject to various natural hazards such as seismic events, rockbursts, fire, and gas (methane). In general, an increase in the extraction depth causes an increase in the likelihood of these hazards, especially seismic activity and rockbursts. Dynamic phenomena such as rockbursts and tremors have been recorded on six continents: Europe (Poland, Russia, Czech Republic, Germany, and Slovenia), Asia (India, and China), North and South America (USA, Canada, and Chile), Africa (South Africa), and Australia. To select appropriate mine working supports for such dynamic phenomena, the performance characteristics of such support types must be determined under both static and dynamic load conditions.This article presents information regarding the application of rockbolts in Polish underground hard-coal mines. Dynamic phenomena occurring in the mines from 2004–2013 are also characterized. A methodology developed at the Central Mining Institute (GIG) for the laboratory testing of rockbolts is presented. In this methodology, the bolts are loaded by the direct impact of a free-moving mass (up to 20 000 kg) at speeds of up to 1.2 m/s. The facilities at GIG used to test the support under static and dynamic load conditions are characterized, and the results of laboratory tests on yielding bolts with a nominal capacity of 420 kN are presented. These types of bolts are commonly used for reinforcing steel arches and the surrounding rock mass in Polish coal mines. The results of the laboratory testing of yielding bolts are discussed.IntroductionSeismic events such as rock bumps and tremors occur with great frequency during underground mining. These phenomena have been reported in such countries as Poland, Czech Republic, Germany, France, Slovenia, Russia, India, China, the USA, Canada, Chile, South Africa, and Australia (Brauner, 1991; Potvin, Hudyma, and Jewell, 2000; Kidybin??ski, 2003; Driad-Lebeau et al., 2005; Li, Cai, and Cai, 2007; Whyatt and Loken, 2009; Durrheim and Riemer, 2012; Holub, Rušajova, and Holec?ko, 2011). Descriptions of the dynamic events and their effects in the form of damage to or destruction of supports have been presented in many publications, both for hardrock mines as well as for coal mines (Brauner, 1991; Dubin??ski and Konopko, 2000; Heal, 2010; Heal and Potvin, 2007; Simser, Joughin, and Ortlepp, 2002; Kaiser and Cai, 2012; Cai 2013; Nierobisz, 2013; Mark, 2014; Masny and Prusek, 2015). One of the main goals of the research has been to develop methods, criteria, and guidelines for the selection of an optimal and safe support for mine workings located in areas of rock bumps or tremors. Example of such studies include the Canadian Rockburst Support Handbook (Kaiser, McCreath, and Tannant, 1996), or the principles presented in the literature (Li, 2010; Cai, 2013)."

Jan 1, 2016

By S. A. Abdel Sabour

Strategic decisions in the mining industry are made under multiple technical and market uncertainties. Therefore, to reach the best possible decision, based on information available, it is necessary to integrate uncertainty about the input variables and model financial risk of the project?s merit measures. However, this provides few useful insights to decision-makers unless accompanied by modelling management responses to uncertainty resolutions. It is widely acknowledged that conventional decision-support methods based on static, no-change, discounted cash flow (DCF) techniques such as net present value (NPV) and internal rate of return (IRR) tend to provide inaccurate value estimates. This could mislead the strategic decision-making process and result in significant value losses. This paper aims to model financial risk related to uncertainty about market variables such as metal prices and foreign exchange rates. Other sources of risk that are related, for example, to geology and production costs are not considered in this work. The article outlines a flexible financial model that integrates uncertainty about market variables and management flexibility to react to uncertainty resolutions into mine project valuation using a real-options valuation technique based on Monte Carlo simulation. Significance of information generated from this simulation-based flexible valuation model to the strategic decision-making process is tested using an illustrative case study of a Canadian mining project. The project is a typical multi-metal, open pit mine that produces copper and gold. In this case, there are three uncertain market variables, which are: copper and gold prices and US$/CAN$ exchange rate. Financial valuations are carried out using both the conventional static DCF method and a flexible real-options model. In the flexible model, management flexibility to decide whether to go ahead with the next expansion or terminate production operations is integrated. Results show how the flexible financial model can enhance the decision-making process.

Jan 1, 2009

By L. Gunnewiek

An advanced real-time monitoring system called the tapblock diagnostic system (TDS) has been developed. The purpose of the TDS is to help furnace operators manage the safe operation and economical maintenance of furnace tapblocks. This system is an evolution of the current practice of using historical records and operator interpretation to assess the ?health? of a tapblock. The main parameters affecting tapblock health are heat removal capacity and refractory wear, and these are currently difficult to assess in situ except in a global way. By using monitored and operating data together with predictive numerical modelling and multivariate statistical methods, real-time tapblock performance is assessed relative to expected performance. A state indicator in the form of a green, yellow, and red light is used by furnace operators to monitor the tapblock performance and health status during operation. Access to historical operating data and the provision of diagnostic functions allow for probable health degradation events to be deeply investigated. A recent opportunity to evaluate the actual performance of a first generation TDS installed in the KIVCET furnace at Teck Cominco?s Trail Operations showed that a reasonable estimate of tapblock health was made. However, the evaluation also found that some areas of refractory wear were missed, and a new mechanism affecting refractory wear was discovered that was not previously known. This has reinforced the belief that there is a need to develop improved methods of monitoring so that data used to define the health of the tapblock is more comprehensive and accurate.

Jan 1, 2008

By B.E. Hall

Maximizing shareholder value has become a common aim for mining companies. This paper discusses the results of a number of studies developing strategic mine plans, covering a wide range of commodities, styles of mineralization, mining methods, and processing facilities, for single and multiple deposits. It has become evident that traditional methods and conventional wisdom often do not in fact achieve these goals. Operating policies at many mines ensure that shareholder value is not maximized. Changing the overall strategy can provide significant value gains. Typically, the new optimal plan involves a significant increase in the cutoff grade, at least in the earlier years. An increase in the underground development rate or open cut stripping rate is often associated with this, at least in the short term, to establish the new strategy. Cost minimization is found to be counter-productive. Counter-intuitive plans are often found to be optimal. For example, optimal cutoffs for different parts of an underground mine may be significantly different, even if mineralisation and cost structures are similar. Sub-optimal strategies are also frequently found to have a significantly greater financial risk than optimal plans, which have been found in many cases to be relatively insensitive to changes in major value drivers, such as metal prices. This paper shows how identifying and then operating within the framework of an optimal strategic plan can have substantial benefits over being continually driven by short-term tactical issues.

Jan 1, 2009

Since 2001, the Hybrid Stress Blast Model (HSBM) project members have developed a software suite to model the complete blasting process from non-ideal detonation to muck pile formation. To preserve the physics and improve solution time, the breakage engine uses a combination of analytical models and 2D axisym-metric finite differences to model near-field crushing, coupled to 3D discrete lattice fracturing and distinct element numerical methods to model throw and muck pile development. The model has been validated by comparison with laboratory and field tests in kimberlite. Multiple blasthole simulations are used to demonstrate how changes to blasting parameters can influence downstream efficiencies. Case studies of wall control blasting show that the presplit design must balance the two opposing effects of increased damage with increased charge and decreasing attenuation of the seismic waves with decreasing charge. Modelling of decoupled explosives needs further development. Reducing the charge towards the back of the trim blast results in a much more significant decrease in back damage than altering the timing. The model demonstrates how separation along the weaker planes in a jointed rock can coarsen the fragmentation, leading to inefficient beneficiation, and extends the damage to a distance of at least twice the burden behind from the blasthole, severely compromising the wall stability.

Jan 1, 2012

By T.R. Stacey

Physical testing of rock support for rockbursting conditions has been carried out for over 40 years. A review of this testing shows that it has been mostly component based, rather than actually testing support systems. Further, it is concluded that none of the testing is truly representative of rockburst loading in a similitude sense. Similitude conditions are not achievable, mainly because the real conditions in a rockburst event, such as seismic source location and magnitude, wave frequencies, amplitudes, and interactions, are not all known. Because such information is not available, and because the results of all testing carried out to date have not been able to define, for support design purposes, the capacity of support systems, ongoing physical testing of rockburst support systems is essential. It is essential that the test should simulate, or actually take place in, a supported rock excavation. A rock support system is a combination of individual support components that work together to retain and contain the rock. In doing this, the components are subjected to loading by the rock and to interactive loading between one component and another. It is necessary to prove the capacity of such rockburst support systems by subjecting them to severe loading, as in direct blasting. The direct blasting approach, pioneered more than 40 years ago, probably still provides the greatest validity as a significant test of rockburst support capabilities, even though it does not simulate a rockburst. Direct blast testing of rockburst support systems in a surface environment, such as in a quarry or on exposed rock cutting surfaces, could represent a practical development of the approach, facilitating the execution and monitoring of tests.

Jan 1, 2012

By J. J. Cilliers, I. K. Craig, J. D. le Roux, K. Hadler

An analysis of the state-observability characteristics of a dynamic tank-to-tank model of a flotation bank indicates that the concentrate-flow rate of each tank can be estimated from accurate measurements of the pulp height in each tank and the final tailings flow-rate exiting the final tank. Therefore, there is an opportunity to construct an observer (model-based soft-sensor) which can estimate the concentrate flow-rate of tanks in a flotation bank. The concentrate flow-rate, i.e. mass pull, is generally measured by means of froth image analysers on industrial plants. A model-based soft-sensor will not only provide a means to validate froth image analyser results, but could potentially substitute them as they are less expensive to implement and maintain. Keywords: Concentrate flow-rate, estimation, flotation, modelling, observability, soft-sensor

Jan 1, 2020

By J. Labuschagne

The primary factor contributing to the profitability of a platinum mine and its associated concentrator is the time taken from the first hoist of material from underground to the first batch of concentrate shipped. To minimize the time it would take to produce concentrate without stopping because of a lack of feed material a project was undertaken to integrate the mining model with a concentrator production schedule () in the most capital-effective manner. A secondary goal was to ensure detailed stockpiling requirements, as the concentrator is in an area where ?visual pollution? is to be avoided. To achieve this a dynamic stockpile model was created utilizing the mine production schedule resolved into a daily production figure. Four different concentrator development models were then proposed. The difference between the mine production and concentrator consumption was integrated over the life of the mine to provide the accumulated stockpile tonnages for both Merensky and UG2 ores. The stockpile levels were never allowed to fall below zero to prevent a situation where the concentrator was operational without feed material,. When a development option was selected, the standard metallurgical performance calculations were used to derive a concentrate production schedule, that was then used as a basis for commercial concentrate sale negotiations.

Jan 1, 2012

By C. O. Esterhuysen, J. P. Deetlefs, C. A. Wessels

The productivity indices of the Republic of South Africa compare poorly with those of its competitors in the rest of the world. The theory of productivity is relatively simple, and various models are available to demonstrate this. The problem is how to apply the theory in practice and to convert it into a practical management system that will guarantee results. The secret lies in a management approach that aims at a continuous improvement in achievement and that involves the entire work force down to the lowest level in the process. Good management systems ensuring the necessary attention to, among others, management by objectives, finance, personnel, maintenance, planning, and control are a prerequisite for continued improvement and staff involvement. The net result of such an approach is described by the term performance management, which encompasses the total integration of al a company's management systems.

Jan 1, 1989

By D. K. Weatherley, T. P. Oladele, L. B. Bbosa

Comminution is a critical stage of mineral processing which aims to reduce the size of ore particles through breakage, consequently increasing the likelihood of liberation of valuable minerals. Several factors, such as pre-existing cracks, mineralogical composition and particle size, are known to affect ore breakage behaviour. While investigating the contributing role of each factor is essential to improve understanding of breakage, isolating individual factors by experiment is typically impractical. Numerical techniques such as the Bonded Particle Model-Discrete Element Method (BPM-DEM) have been developed as a means of studying closely controlled breakage conditions. This study evaluates this technique in modelling the effect of pre-existing cracks breakage behaviour for synthetic ore specimens during impact breakage in a short impact load cell (SILC). Synthetic ore was modelled as a collection of discrete entities connected by brittle-elastic beams. Model parameters were calibrated against macroscopic material properties of a conventional homogenous synthetic ore. The extent of pre-existing cracks within specimens was prescribed by varying discontinuities between the connecting entities. An approach with the insertion of seed points was used to model the mineralogy of the specimens. Results showed that pre-existing cracks resulted in a decrease in the fracture force as the crack density increased. Additionally, the irregularity of fracture patterns within rock specimens after impact became more apparent as the crack density increased. The findings were used to emphasise some of the attributable causes of the variation observed between ore hardness characterisation tests and in situ ore behaviour. Keywords: Element Method; Bonded Particle Model, synthetic rock sample; rock fracture, preexisting cracks

Jan 1, 2020

By F. Botha

South Africa is amongst the 40 driest counties in the world, with extreme weather conditions and beset by both droughts and floods. Coupled with economic growth is an increased demand on water resources and, as with all other industrial developments, mining requires large volumes of water, which is likely to have an impact on the environment. Further to this, the mining industry also realizes that minerals are a non-renewable resource and the contribution to wealth creation from mineral extraction is not everlasting. It serves as an economic boost and careful planning is required to ensure that the legacy of mining is sustainable, and that some of the returns from mining provide continual economic and social prosperity.

Jan 1, 2012

By G. T. van Rooyen

In this overview of materials engineering, the author, drawing on his long experience from his student days until the present (emeritus professorship), briefly recounts the main developments in this field: dislocation theory, fracture problems, and the development of alternative materials such as ceramics and polymers. He then takes a look at the future, in which he foresees a greater demand for materials engineers, and leading roles for universities and technikons in collaboration with industry.

Jan 1, 1996

By D. F. Malan, J. C. Esterhuyse

"Mining in the Carletonville area of the Witwatersrand Basin predates 1934. Owing to the depletion of higher grade ore, the current activities focus increasingly on the extraction of lower grade secondary reefs as well as remnant extraction. Of particular interest is multi-reef remnant extraction. Numerical modelling was conducted to investigate some rock engineering aspects of remnants being understoped on a secondary reef horizon. An analysis of the stress evolution in the middling between two reef horizons indicated that a zone of high major and low minor principal stress develops between the two reefs. This indicates a high risk of violent shear failure. Some pillars were nevertheless successfully understoped in the past and a study was conducted to better understand this phenomenon. An ’extended’ energy release rate concept introduced by Napier and Malan (2014) proved to be useful for investigating this problem. It was found that bedding planes and lithology appears to play a role in the stable dissipation of energy in multi-reef remnant geometries. The study indicated that the stope convergence and the various energy components are affected by the presence, position, and properties of a bedding plane. The energy solutions are complex and sometimes counterintuitive. Care should be exercised when modelling specific cases. The modelling was nevertheless valuable as it indicated that energy dissipated on weak layers may reduce the risk of violent failure in a multi-reef mining scenario. Additional work is required to investigate if crushing on the reef plane plays a prominent role when mining these remnants. IntroductionTo extend the lives of the Witwatersrand gold mines, work is being conducted to include a larger number of remnants and pillars in the reserve base of the mines. According to Jager and Ryder (1999), a remnant is an unmined block of ground surrounded by extensive mining. Remnants are typically left because of adverse or difficult mining conditions caused by geological structures, poor ground conditions, low grade, or rockburst damage (Durrheim, 1997). In contrast, pillars are typically the result of rock engineering designs to control energy release rates (ERR) and seismicity. During the early 1900s, remnants formed by the practice of scattered mining layouts had a significant effect on seismicity. Numerous task teams were appointed during this period. As the industry expanded, the severity of rockbursting increased and the research was formalized after the 1960s. Various recommendations were made and many of these are still used as best practice today (e.g. Jager and Ryder, 1999)."

Dec 1, 2018

By Willie Hefer

Contents ?Purpose ?Introduction ?Deviation of bias results ?Operational correctness ?Maintenance and Costs ?Conclusion ?Acknowledgements

Jan 1, 2005

By D. S. Loubser

The technique of backfilling in the gold mining industry is dependent on the dewatering of slurry to form a solid support system. In many cases flocculants are added to the slurry to increase the rate of dewatering. To ensure that a stable support is obtained it is important that the chemistry, application and limitations of these flocculant additives are understood. Flocculant additives have to be added at a point where minimum shear will occur. (Shear occurs when a flocculant is exposed to excess energy resulting in breakdown, of the floc.) To ensure that optimum results are obtained it is important that personnel involved are trained to use the flocculant additives and dosing equipment correctly.

Jan 1, 1988

This paper describes an interactive personal computer program, ENVIRON, which simulates cooling and ventilating systems on gold mines. An example of the practical application of the program is given and proposed future developments are discussed. The program consists of two main modules, HEATFLOW and VENT- FLOW. HEATFLOW calculates the heat loads and the effect of air coolers, while VENTFLOW estimates the air flow distribution. As the calculation of the heat loads requires a knowledge of the air flow and vice versa, the two modules are run iteratively until the solution converges. The program is written in Pascal and runs on any IBM-compatible personal computer.

Jan 1, 1987

In a gold CIP/CIL circuit, adding new circuit water to a final tails thickener and then directing the thickener overflow to the head of the circuit significantly reduces the cyanide concentration at the TSF discharge spigot. The new water is used to dilute the final tails. The dilution and recycle of the tails in this manner may have the added benefit of reducing reagent consumption, in some cases to the point where the reagent savings justify the expenditure and Cyanide Code compliance is achieved at no extra cost. Potential circuit configurations and water recycles can be modelled by splicing a flowsheeting and thermodynamics package, such that changes to the composition of the water can be reduced to chemical speciation with a Gibbs free energy minimisation enabling a complete understanding of the circuit water chemistry.

Jan 1, 2007

By I. D. Wood

Deposition of gold-bearing deposits in the Witwatersrand Basin was controlled by hydraulic processes. These resulted in the formation of independent sedimentological facies areas having different statistics and semivariograms. Consequently, when there are indications that data are a mixture of statistical populations, it is important to decompose them into statistical subpopulations and analyse these independently. However, in the case of actual mining, physical position and extent of sub- populations are important and, as a consequence, any decomposition of data must take space into account if it is to be of use. An algorithm for the spatial decomposition of data into its sub-populations is described and is applied to real data taken from the Witwatersrand. Two distinct areas with completely different geostatistical parameters were revealed.

Jan 1, 1987

By K. R. Johnson

Changes in the pattern of computer systems for mine planning and geologic evaluation are occurring as a consequence of the introduction of 3-D high performance graphics terminals. The VULCAN system is described and an outline of its functionality is discussed. Increasingly, the integration of both database systems and graphics and databases will occur, allowing a greater degree of information access to mine operators. The system covers areas of database, drillhole graphics, mine design and layout, surface and solid modelling as well as reserve inventory generation. The design of the software is such that it is fairly commodity-independent and entirely menu-driven, to enable non computer-trained personnel easily to access the system.

Jan 1, 1987