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By R. Tinsley

Project-finance risk assessment is mature and approached systematically. Mining industry due diligence remains fragmented with specialists addressing different aspects of the project such as reserves/JORC, environmental impact, commodity market, even financial analysis/ modelling. Each professional has a natural tendency to believe that the risk factors they have examined are the key ones necessary to be reviewed, as if their review will stand in isolation from others in the way a project materialises. By first laying out the project risk categories and risk matrices, this paper examines the due diligence process with a keen eye to the risk assessment and overlap/interaction. Some cross fertilisation of due diligence techniques from other industry sectors is placed into the mining context. Six case studies are then presented with regards to due diligence features in each project's feasibility review or financial information/ offering memorandum. A power case first shows the differences between the due diligence expectations of banks versus bond financings. Then some Australian and Indonesian mining development cases are analysed to see the due diligence learning points. Some of these were project/due diligence failures. The conclusion focuses on the value of a systematic risk assessment for project evaluation, all from the project-finance perspective.

Jan 1, 2007

From its early beginnings, shortly after the Witwatersrand gold rush of 1886, Randfontein Estates was planned as a heavyweight operation. The venture was capitalized by J .B. Robinson to the tune of £2 million at time when syndicates were loath to invest £50000 in ventures in and around the new metropolis, Johannesburg, which had sprung up midway along the Witwatersrand. But by then Robinson was a colossus among his contemporaries. Operating as a loner as he had done on the Kimberley diamond fields, where he created his own individual fortune and commanded the sort of respect which, early in his career, led to his election as Mayor of Kimberley. When news of a third gold discovery in the Transvaal (the first two had been in the Pilgrim's Rest and Barberton areas) reached Kimberley, Robinson's pioneering spirit was further stired and he hastened to the new goldfield to stake his claims before his business adversaries- Rhodes, John X. Meriman, Hans Sauer, and Caldecot-could entrench themselves. Once the new Witwatersrand goldfields had been proclaimed, claimpegging started in earnest. But the question was: where to start? Diamond men al, not one of the financiers had any knowledge of the geology of the gold-bearing formations.

Jan 1, 1989

By L. Raaths

This paper outlines the process of improvement utilizing performance monitors and GPS systems on an opencast strip mine. Its primary focus is to maximize coal exposure by draglines and secondly to improve on those processes impacting directly on the dragline operation. The Aquila (DM2/5 system) navigation and monitoring systems were installed on the overburden drills. Their main function is to eliminate manual staking and positioning thereby ensuring a regular pattern being drilled. Holes drilled to planned depth reduce drill metres and it minimizes coal losses and contamination at the coal interfaces. The CAES (Computer Aided Electronic System) will be installed and evaluated on the Caterpillar D11 dozers at Optimum. This system ensures a correct dragline pad elevation through the use of planned elevations and GPS technology to achieve the optimal pad elevations for draglines consistently. The draglines are equipped with a Dragline & Operators Performance Monitor. This monitor allows the operator to control his own performance. It reports on all productivity, method and poor operating techniques. These monitoring systems send critical operational information back to the office. This source data resides in central databases from where it is converted and integrated into management information. To manage an operation means that you as a manager must be able to set objectives and targets and to achieve your goals the activities involved must be measurable.

Sep 1, 2001

By D. G. Davies

Colloquium on the construction of Slimes dams The following contributions to the discussion at the above Colloquium were received for publication. D. G. DAVIES* This contribution is really a follow up on Mr H. E. Cross's paper on the conversion of a uranium plant to the recovery of zinc (published in the Journal, November 1973). Ecological aspects of slimes-dam construction by H. T. CLAUSEN C. M. VAN STADEN* Published in the Journal, December 1973 I should like to thank Mr Clausen for his paper and to congratulate the Research Laboratories and the Vegetation Unit of the Chamber of Mines on the excellent work they have done in the past, are still doing at present, and, we hope, will continue to do in future, on the testing of various methods for the covering of slimes dams and specifically on the vegetation of dams. The impact of slimes-dam formation on water quality and pollution by R. T. RUDD* C. M. VAN STADEN Published in the Journal, December 1973 I should like to congratulate Mr Rudd on the paper he presented. Congratulations are also due to the Department of Water Affairs for the practical attitude they have taken in implementing the Water Act. Slimes-dam construction in the gold mines of the Anglo American Group by W. T. RUHMER W. R. FLOOK* Published in the Journal, February 1973 Methods for the construction and operation of slimes dams in the gold-mining industry do not appear to have changed much for some considerable number of years.

Jan 3, 1974

By T. Puhakka

Simulation is a way to obtain quickly today future information on how planned systems will most likely behave in various selected situations. This information may then be used to optimize the system and its components and maximize the performance and output. Simulation is a way to fine-tune the layout, match the mobile fleet and optimize the schedule and the way of working to meet the desired production requirements. Simulation provides a glimpse of the upcoming operation, ‘future today’ and helps to predict its restrictions and sensitivity to various aspects. OptiMine™, the Sandvik Tamrock Corp. and CyberCube Oy developed simulation tool is designed to simulate underground rock flow and match suitable technology with various layout options. This tool can be used to view what-if situations and determine what kind of impact mastered changes have to production. The findings of critical points in the layout and working procedures at an early stage of a new mine can help to optimize the layout and material flow. OptiMine™is modular based simulation tool that combines the supplier machine knowledge and traffic guidance with mine operational know-how and mine environment. It is developed to work in a way that an effect of an individual incident, such as the effect of one additional turn in a continuous loading cycle to the daily capacity can be identified. The reported output can be used for economical impact evaluation of selected options. This paper discusses the use of simulation in general and the way the OptiMine™ simulation tool operates and how it may be used for operation, technology and material flow optimization.

Sep 1, 2001

By L. W. Helle

This paper summarizes the investigations carried out into a defect involving the corners of billets rolled from continuously cast blooms, which broke open during the rolling process. As it was believed that the defect must be connected with the formation of subcutaneous blowholes in the bloom, the investigations were directed towards an understanding of the roles of the three gases involved in the process. In an extensive trial programme, samples were taken from the heat at all stages of processing, as well as from all the raw materials and alloys. The main sources of nitrogen were found to be re blows, pick-up from the alloys added to the ladle (especially graphite), and open-stream casting. The major source of hydrogen was moisture in the alloys, especially high-carbon ferromanganese and silicomanganese. Further, it was established that the moisture content of the alloys is closely related to the appearance of the defect in steels with a carbon content of less than 0,20 per cent; 72 per cent of all the defects were present in this type of steel. Most of the remaining defects were found in steels with a carbon content of more than 0,60 per cent, where the nitrogen content was substantially higher than in the lower-carbon steels. It is suggested that the defect arises from the combined effect of oxygen. nitrogen, and hydrogen. Its occurrence in low- and high-carbon steels is triggered by the formation of subcutaneous blowholes when the critical oxygen level for carbon monoxide blowholes is lowered by the presence of excessive amounts of hydrogen and nitrogen respectively.

Jan 1, 1984

By G. Newson, N. Runciman

In 1999, INCO Limited Mines Research, in Sudbury, Ontario, Canada, took delivery of a MeycoRobojet Logica Spraymobile, a computerized concrete spraying system. The Spraymobile is a self-contained mobile machine capable of applying spray-on ground support in underground applications. The Logica component of the Robojet is designed to control the operation of the Robojet, as well as scan and map the tunnel geometry prior to the spraying operation. The Robojet can be operated in various modes, from manual to automatic operation. In the automatic mode the computer controls the standoff distance, angle, and motion of the spraying jet. In 2000, INCO Limited, working with Meyco Equipment of Switzerland (a division of MasterBuilders Technologies), detailed a plan to create a tele-operation package for controlling the spraying process from a surface location at INCO's Mines Research Test mine. With the RobojetLogica operating in automatic mode, the operator at the machine becomes a process monitor. Since the Logica system controls the key spraying parameters of nozzle distance and nozzle angle to the sprayed surface, the operator could easily monitor and control the Robojet Logica from aremote location. The benefits of operating underground mobile mining (drills and LHDs)equipment from a surface location has been demonstrated at INCO Limited, however, the abilityto control a ground support operation (shotcrete spraying) from surface has not been attempted until now. This paper will describe the Spraymobile shotcreting system, the development of the tele-operation package for the Robojet Logica, as well as modifications to the original Spraymobile for implementing the tele-remote package on the Robojet Logica at the Mines Research test mine.

Sep 1, 2001

The Centenary Distinguished Lecture was held on Thursday, 24th March, 1994 at the Convention Centre of the Sandton Sun, Johannesburg at 20:00. Herewith the proceedings that followed. P.R. Janisch: The South African Institute of Mining and Metalurgy began life one hundred years ago tonight, and eight years (almost to the day) after the 1886 discovery of gold, which has impacted so profoundly on the course of events in our country since then. The Early Years That discovery was a mater of fortune, but not in the sense of the conventional prospector's lucky strike. Canny explorers, such as the Strubens, had been around for some years and, if George Harrison had not stumbled over the Main Reef when he did, someone else would surely have done so within months. The element of luck was that the gold-bearing rocks of the Witwatersrand actually lay exposed to sight. We now know that they are something of the order of 2,5 billion years old. Rocks of that age are usually covered by younger formations. In fact, the bulk of the Witwatersrand Basin is covered by lava, dolomite, and Karoo measures. What, one wonders, would our history have been had the Karoo, which stops at the Vaal, extended no more than 60 kilometres further north. Dr H. Scot-Russell A piece of advice attributed to Paul Kruger, the who was President of the South African Republic one hundred years ago, was the following: 'Seek from the past that which is good, and build on it for the future'. It is advice that can be applied universally and, whether deliberately or not, it must have motivated my predecessors when this Institute celebrated its 40th, 50th, and 75th birthdays. Those milestones were each marked by retrospectives, as Peter Janisch has so ably presented tonight on our hundredth anniversary. The parallels do not end there. We find ourselves in times no less daunting than those our predecessors. Next month will see the birth of a new kind of South Africa; so did May 1902, May 1919, and May 1948.

Jan 1, 1994

By F. L. D. Cloete, M. C. Coetzee

This study was aimed at a comparison of the efectiveness of a new axial-flow type of mixer impeller (the Prochem design) with the traditional inclined-blade turbine. The intended application of the mixers was in carbon-in-pulp plants for the extraction of gold from cyanide-leached pulps. The first part of the project involved water and ion-exchange resin, and measurement of the power drawn by the various sizes of impeller to fully suspend the resin. The rate of reaction between the resin and the solution was measured as a function of the power input to the mixer. In the second part of the project, use was made of activated carbon, silver cyanide solutions, and ore pulps. The rate of absorption of silver from the solutions and pulps was determined, as well as the rate of attrition of the activated carbon caused by the various impellers in clear water. The Prochem design of axial-flow impeller was shown to fully suspend solids at only one-quarter of the power requireabyan inclined-blade turbine of similar size. The axial-flow pattern produced was responsible for the more uniform vertical concentration profile of suspended beads produced by the Prochem design. These measurements verified the observations of other researchers that the rate of reaction is not affected by the ;design of impeller provided that al the solids are fully suspended. The Prochem design of impeller therefore achieved the same reaction rate as the conventional turbine at a quarter of the power input. The atrition rates of activated carbon could be correlated, in terms of the energy absorbed, by the same equation for al the impellers. Higher concentrations of activated carbon increased the amount of carbon fines produced. These results emphasize the importance of designing mixers for minimum power consumption.

Jan 1, 1989

By Y. -H. Chang, Y. -J. Jou, T. -S. Ueng, I. -H. Peng

In order to systematically study the size effect on the shear strength of rock joints, this study used the computer-aided-manufacturing system to reproduce the artificial rock joints for saw-toothed joints, Barton's standard joint profiles of JRC = 4~6 and 18~20, and natural rock joint profiles. We divided, enlarged, reduced, and assembled these joint profiles to obtain joint specimens of various sizes ranging from 75 mm to 300 mm in length. The shear strengths of these joint specimens were tested under different normal stresses using a direct shear test apparatus. The surface conditions of the joints at failure were also examined. The size and geometry effects on the shear strengths of these joints of various sizes and configurations were evaluated based on the test results. Um die künstlichen Trennflächen für reguläre dreieckige Trennflächen, Bartonsche standardmäßige Querschnitte der Trennflächen von JRC = 4~6 und 18~20 und natürliche Querschnitte von Trennflächen wiederherzustellen, benutzt diese Forschungsarbeit das Computergestützte-Erstellungssystem, damit die Maßstabswirkung auf die Scherfestigkeit von Trennflächen systematisch untersucht werden kann. Die Querschnitte werden geteilt, vergrößert, verkleinert und zusammengesetzt, um Trennflächenproben in Längen variierend von 75 mm bis 300 mm zu erhalten. Die Scherfestigkeit dieser Trennflächenproben wird unter unterschiedlichen Normalspannungen mit einem Direktscherversuchsgerät getestet. Die Querschnittszustände der Trennflächen bei Versagen werden ebenfalls untersucht. Nach den Untersuchungsergebnissen werden die Maßstabs- und Geometriewirkung auf die Scherfestigkeit dieser Trennflächen verschiedener Größen und Konfigurationen ausgewertet. Pour étudier systématiquement l’effet de la dimension des fractures des roches sur leur résistance au cisaillement un système de creation de fractures artificielles à l’ordinateur a été employé. Des fractures artificielles triangulaires, profils de fractures de Barton avec JRC = 4~6 et 18~20, et profils de fractures naturelles ont été reproduits. Les profils des fractures ont été arrangés de manière à obtenir des échantillons de longueur entre 75 et 300 mm. Une boîte de cisaillement a été utilisée pour étudier la résistance des fractures au cisaillement, sous plusieurs conditions de contraintes normales. Les conditions superficielles des fractures après rupture ont été étudiées. Les résultats de ces essais, effectués sur plusieurs échantillons de dimensions et configurations variées, ont contribué à établir l’influence des dimensions et de la géométrie des fractures sur leur résistance au cisaillement.

Jan 1, 2003

On 23rd October, 1969, 54 members of the Institute set out at an early hour from Rand Airport in two chartered Dakota aircraft for a visit to the Hendrik Verwoerd Dam site. The weather was at the start rather unpromising but after passing Bloemfontein the overcast cleared and it turned into a glorious day for a most memorable visit. The Institute is indebted to U.C-Dumez-Borie Dams Limited, the main civil engineering contractors, and Mr J. D. McNamara their executive manager, for the very excellent arrangements made for this excursion. From the time the aircraft landed till a slightly belated departure the organisation of the extensive tours arranged for the parties was quite outstanding and a matter for congratulation to all concerned. At each of the many places visited there was a senior official to give an authoritative and comprehensive description of the work under his control. In addition the guides on the buses, loaned by the Department of Water Affairs, kept up an interesting running commentary throughout the day. A further much appreciated facet was the introduction of many of the experts on the site and a brief talk by each after an excellent lunch served at the recreation club. Each visitor also received a brochure with a progress report and a detailed site plan, with various sections highlighted in colour, and obviously prepared at the cost of much time and effort. The visit included tours of the large dolerite quarry, where some 150 000 tons of rock are removed each month, the 42 in. gyratory primary crusher, the secondary crushing and screening plant, the rod mill plant for sand production, and the automated blending and concrete batching plant. The transport of mixed concrete by 'silobuses' to the 6 cu. yd buckets of four Blondin cableways, two of which are radially movable and two with buffing towers, and the placing of the concrete in the huge blocks of the wall was watched from a vantage point. The most interesting part of the visit was without a doubt the inspection of the wall itself and the explanations of the many intricasies of its design and care in construction, covering aspects such as positioning of galleys, interlocking of blocks, reinforcement, refrigeration, actual concrete placing, subsequent grouting, etc. Other points of interest were the very complicated design of the wall itself, the river diversion plans, with three stages of coffer dams, the spillways, and the very well cut penstock tunnels.

By J. A. L. Napier

One of the most important characteristics of tabular mine stress analysis is the need to represent the complex evolution of mining face positions and the accompanying induced stress changes in the rock mass. Integration of seismic activity with numerical modelling requires flexible and efficient solution schemes in which both off-reef damage and large-scale fault slip can be effectively represented. A new approach is investigated in which the stope closure and ride variables can be found using a moving least squares estimator. Some advantages of this approach over traditional element-based tessellation schemes are identified. At the same time, shortcomings of this method are noted when the displacement discontinuity variable is approximated by a polynomial shape function. Difficulties and possible solutions to the shape function formulation near excavation edges are discussed. Une des caractéristiques les plus importantes de l’analyse des contraintes minières tabulaires est la nécessité de représenter la complexe évolution des positions du front de taille et des changements concomitants des contraintes occasionnées dans la masse rocheuse. L’intégration de l’activité sismique avec la modélisation numérique requiert des projets souples et efficaces qui permettent la représentation des dommages hors-filon et des glissements de faille à grande échelle. Une approche nouvelle est étudiée qui permet de trouver la fermeture de la taille et les variables de montage en utilisant un estimateur par les moindres carrés mobile. Certains des avantages de cette approche sur les traditionnels projets basés sur une structure en mosaïque sont identifiés. En même temps, les défauts de cette méthode sont notés lorsqu’on calcule la variable de discontinuité du déplacement approximativement par une fonction de forme polynomiale. Les difficultés et solutions possibles à la formulation de la fonction forme près des bords d’excavation sont discutés. Eine der wichtigsten Charaketeristika der taublaren Grubenspannungsanalayse ist die Notwendigkeit, die komplexe Entwicklung der Abbaupositionen und der damit verbundenen induzierten Spannungsänderungen der Gesteinsmasse neu vorzulegen. Die Integration der seismischen Tätigkeit mit einem numerischen Modell erfordert flexible und effiziente Lösungsschemata, in denen sowohl Schäden ausserhalb des Riffs als auch Verwerfungen großen Ausmaßes effektiv dargestellt werden. Ein neuer Vorstoß wird untersucht in welchem die Strossenschliessung und Schneisenvariablen unter Verwendung des Schätzwertes der kleinsten quadratischen Abweichungen (Gaussscher Schätzwert) gefunden werden. Einige Vorteile dieser Annäherung im Vergleich zu der traditionellen Element-basierenden Tessellation sind identifiziert. Gleichzeitig werden Unzulänglichkeiten dieser Methode vermerkt, wenn die Verschiebungsdiskoniuitätsvariable durch eine polynomische Formfunktion angepaßt wird. Schwierigkeiten und mögliche Lösungen zur Formfunktionsformulierung nahe Exkavationsrändern werden besprochen.

Jan 1, 2003

By O. Tshifungat, A. Luzanga, N. Goel, S. Sandoval

"Tenke Fungurume Mining Company (TFM), located in Katanga Province, Democratic Republic of Congo (DRC), began production of copper cathode and cobalt hydroxide in March 2009. Copper production capacity was 115 000 t/a utilizing a semi-autogenous grinding, agitated leach, countercurrent decantation process followed by solvent extraction and electrowinning (SX-EW). Cobalt production capacity (as cobalt hydroxide) was 8000 t/a utilizing a three-stage purification/precipitation process treating raffinate from the copper SX-EW process. Recently a phase II expansion was completed, in which copper electrowinning capacity was doubled and four stages were added to the SX plant. Corresponding enhancements were made to mining, milling, and processing to bring production to 195 kt/a copper and 15 kt/a cobalt. An additional sulphuric acid plant is currently being constructed, adding 1400 t/d sulphuric acid to bring total acid production to 2250 t/d for use in leaching at TFM.Initial copper electrowinning results were satisfactory, but cathode quality and current efficiency decreased as copper production increased. The Freeport-McMoRan (FCX) Technology Centre and TFM personnel began operation of two bench-scale copper electrowinning cells in the tankhouse to diagnose chemistry effects on the cathode and anode. The results indicated an excellent electrolyte chemistry, producing finely crystalline copper at 430 A/m2 current density with 98% current efficiency. Attention next turned to the physical factors of the electrowinning cells, including electrode insulator geometry and performance. A demonstration cell was selected in the tankhouse and was operated with varying cathode and anode insulator geometries. Operation of the demonstration cell with a three-side cathode edge strip, A-style anode insulators, and an improved cell furniture design increased current efficiency from 77% to 89% at 400 A/m2 current density. Cathode quality improved correspondingly. TFM is now operating at 92% current efficiency."

Jan 1, 2016

By Dr Peter Laxen

Dr Peter Laxen, the Mintek Consultant on gold and uranium, has won the 1982 award of the Percy Fox Foundation. The presentation was made by the Minster of Finance, Mr Owen Horwood, at a banquet on 6 March.

Jan 1, 1982

By Pieter de Waal

The beneficiation equipment under the control of plant metallurgists exploits the differences in the physical properties between valuable and waste mineral components. In many cases, laboratory results are too late for process control and can only serve the purpose of "post" reports, the calculation of a mass balance and the issue of a quality certificate. As a result, experienced operators regularly adjust separation equipment based on the colour and texture of the various product streams in the beneficiation plant. Metallurgists quickly learn to recognise the different minerals in their ore body. The stereo microscope has been a valuable tool used by operators to quantify known mineral species. For many years it was the only practical method available for the purpose of process control and even for quality contro1. The modem spectroscope is far superior to the human eye and can rapidly detect a change in mineral composition. New generation optical scanners and digital signal processors can provide useful signals, related to mineral composition that can readily be applied for the purpose of process control. Successful case studies, covering dry in-line and slurry applications as well as in-plant fast spot analysers are presented.

Jan 1, 2014

By A. Cambitsis

We show that the prioritization of business improvement and performance management decisions may be significantly improved by taking into account the systemic effects of changes made in a single process area. To do so we build a model of a mining value chain, taking into account consequential downtime that arises from downstream and upstream starvation and choking effects of each activity. Introducing the concept of internal capacity, this approach yields insight into the relative importance of key metrics such as loading and hauling rates. We suggest that a holistic view of this type should be a core component of business improvement and performance management decisions.

Jan 1, 2012

"Chairman: Professor B. W. MacKenzieRapporteur: Professor D. A. PretoriusPapers:Optimum spacing for soil sample traverses by W. A. HodgsonEvaluation of geochemical data by C. J. LenzResearch in oil exploration decision-making by J. W. Harbaugh and A. Prelat A drill hole data bank by M. R. AndertonOre reserve estimation and depletion planning for a beach diamond deposit by M. M. OosterveldIn opening the session, the Chairman indicated that the papers and discussions would revolve about quantitative methods of analysis and optimization of various aspects of exploration planning. The five papers would cover a wide range of topics within a general theme of exploration analysis, and it would be appropriate, therefore, to present the. papers as representing a sequential information-gathering process, namely, (i)geochemical and geophysical types of surveying for the location and identification of anomalous zones, (ii) tren¬ching and drilling of the anomalous zones found, and (iii) further refinement of the data for ore reserve calculations and production planning.The first paper, which was presented by Dr W. A. Hodgson, dealt with the optimum spacing between soil sample traverses conducted during geochemical prospecting. The theme of the paper was that the critical sampling interval should be based on the concept of element continuity, and that this interval could be determined by means of a correlogram. Ensuing discussion concerned the probability of the method, designed for areas where dispersion was high, working in localities where dispersion was either low or virtually non-existent. In the latter eases, specific orientation surveys for varying topographic, climatic and geological conditions would possibly be more useful than the preparation of correlograms. A further suggestion was made that cost versus risk should be taken into consideration when deciding upon the spacing between traverses. A balance could be struck by mathematical optimization. If the exploration budget was fixed, then the variance of risk could be minimized.The second paper was a short contribution by Mr C. J. Lenz. Computer-based plotting and evaluation of geochemical prospecting results were carried out because the low cost of analysis in Rhodesia permitted very large volumes of data to be accumulated in mass-coverage operations. Anomalous areas were demarcated within different environments by selecting probability or population boundary values from frequency distributions. In the short discussion which took place it was debated whether the method should be used only in the early high-risk stages of geochemical exploration and whether the introduction of geological bias could influence the actual results of an exploration program."

Jan 1, 2014

By H. W. Glen

The National Institute for Metallurgy - usually referred to as NIM - has become the Council for Mineral Technology, or Mintek. The Honourable F. W. de Klerk, Minister of Mineral and Energy Affairs, announced the change of name at the official opening of the main entrance to Mintek's premises on 30th October, 1981. Awards for bravery Two men who disregarded the dangers of fiercely burning timber and falling rocks to douse an underground fire, using their hard hats to scoop water from a drain, received the Chamber of Mines Award for bravery at a ceremony held at West Driefontein Gold Mine near the end of October.

Jan 1, 1981

I appreciate the honour that has been bestowed upon me by my election as President of this Institute. We are starting what I believe will be a challenging year. The first challenge facing the Institute is financial. From the accounts for you will note that the Institute operated at a loss for the first time since 1987. average membership subscription was increased by only 10 per cent, reflecting desire to keep costs down in the minerals industry. The Institute will therefore to rely on other income to meet its budget requirements and break even financially. source of these funds will be the activities of the Technical Programme Committees. disciplines-Mining, Extraction Metallurgy, and Metals Technology are planning programmes for the coming year. I urge al members to increase their support of colloquia schools. Increased membership would also bring in more funds. Please, therefore, encourage colleagues who are not yet members of the Institute to join it.

Jan 1, 1991

"Chairman: Mr R. A. PLUMBRIDGE Rapporteur: Dr D. M. HAWKINSPapers:The relevance of computer methods to the economics of the mineral industry by R: A. PerlmanDynamic control of a mining enterprise by R. G. CoyleAn economic model of the mineral sands industry by G. P. A. HoweMr M. Splaine, in opening the discussion on Mr Perlman's paper, asked whether the model, as fitted by data up to 1963, predicted the rise in the price of copper in 1967, and whether the model could be used to capitalize on short-term price fluctuations.Answering the second question first, Mr Perlman said that the horizon used is six months to one year. In the very short term the activities of speculators obscured the effect of the fundamental econometric variables. This effect, however, was removed if one moved to a longer term, say, quarterly. In 1963 the model had predicted a price rise in 1964 and 1965 and a drop in price in 1966. The rise in 1967 had been caused by a strike, and imponderables such as large strikes were difficult to include in the model since they were unpredictable. Model simulation can be used to show the effect of strikes on price and the effect of small strikes is small.Mr B. R. van Rooyen said that because models are both calibrated and tested on historical data a bias was introduced which gave rise to an overoptimistic estimate of the accuracy of the forecasts. To this Mr Perlman replied that there seemed to be no alternative to the use of historical data for calibrating and testing models, and thus little hope of avoiding the bias. A second point made by Mr. van Rooyen was that manage¬ment tended to be suspicious of complex models and that frequently more heuristic models were sufficiently accurate and preferable for investment decisions. He added that if management were not involved in the model building the econometrician might easily go astray, Mr Perlman replied that symbiosis between data analysts and users of the model was essential and that the experience of the practitioner must be reflected in the model.Mr M. R. Fuller-Good remarked that a clear understanding of future price trends was essential for effective capital planning, and asked, first, how one went from the compiled data on supply and demand to the determination of their effect on price, record, whether necessary data, for example, capacities, could be obtained timeously, and, third, when strikes restricted supply, whether stockpiling by consumers induced large price fluctuations."

Jan 1, 2014