by Engr. Jeffrey Q. Geronimo
Mining remains an essential industry in the COVID-19 pandemic even though it has experienced devastating impacts. According to S&P Global Market Intelligence, this pandemic disrupted 275 mining operations across 36 countries. Not only that, over $8.8 billion in total revenue is continually at risk. Therefore, the strategic importance of proper planning to ensure long-term mining viability cannot be underemphasized.
In response to this urgency, a flexible strategic mining solution was tested by a global leader in mining technologies. They evaluated 23 mining pits from various mining companies. In a span of just 15 hours, it produced a staggering 1,600 directional alternatives in their nested pits.
These alternatives were then narrowed down to three of the best pushback directions based on the company’s KPIs. The best option was then selected to be the most optimal and feasible design implementation to yield the maximum performance for the final mine pit over a long duration of time.
The result? An astonishing increase of 5% net present value (NPV) delivered to these mines even at the onset of the COVID-19 pandemic.
This is all made possible by Dassault Systèmes GEOVIA’s new Strategic Mine Planning (SMP) solution. It allows mining operations to update their planning and modelling quickly by assessing all options available to ensure long-term viability.
“Planning plays a fundamental role in the evaluation of any mining operation, from the initial resource estimate to the project feasibility stage. Such planning also has to be inherently flexible, taking into account the viability of a resource, whether or not it is economically feasible to extract, how long this will take and the best sequencing of such extraction. What’s more, all of this has to be analyzed over the entire life of mine, which could be anything from 30 to 40 years or longer,” commented Andy Mulholland, the Business Consulting Director of GEOVIA who conducted the SMP solution.
Guiding Investment Decisions
Making assumptions in mining costs are greatly dependent on the mining method selected. Caving, for instance, is a very effective mass-mining method. However, choosing this is an upfront decision that locks you into this approach.
Alternatively, other underground and surface mining methods give the operator more control through the life of the mine. The mining direction can also be altered over the life of mine to track the ore body more accurately.
The new SMP solution is critical in guiding investment decisions during the exploration or feasibility stage. It can be used to update precious resource and reserve models. It makes it easier to understand what is viable to extract, in addition to the grade and value in the light of fluctuating commodity prices. This enables us to realize an updated life-of-mine estimate. From here, procurement decisions in terms of capital equipment can then be optimized.
“Hence, it is essential for mining companies to be able to run as many different scenarios as possible to generate multiple options for dealing with a range of contingencies. This underscores the true value of a mine in relation to its costs in real-time, to drive investment decisions in as smart and as proactive a manner as possible given the current volatile market conditions. The advantage of the SMP solution is that it does not merely generate a myriad of potential outcomes,” elaborates Mulholland.
Increasing Robustness and Improved Decision Making
Dassault Systèmes has the necessary up-to-date tools to be able to isolate options that are least sensitive to the variables under consideration for added robustness and improved decision-making. Say for instance, a plan with a slightly lower net present value for a mining operation may be far more robust and less susceptible to uncertainty.
When blended with pit design, a robust production plan must consider several strategic questions, such as the estimated life of mine, the mining rate and subsequent processing rate, the location of the dump piles, and the critical infrastructure required.
In this instance, Dassault Systèmes ran 9,680 sequences with different cut-off grades, prices and production capabilities and capex, generating a so-called ‘hill of value’ in under 24 hours.
“Hence, production becomes more manageable, stable and sustainable. An efficient mine with an optimal production plan guarantees surety of a mining project in the long term, whilst minimizing risk,” concludes Mulholland.
Through Paramina Earth Technologies, Inc., the premier mining software solutions provider in the Philippines, mining companies can now gain access to SMP in order to generate as many scenarios as needed.
Comprehensive training on how to fully utilize and maximize the potential of SMP may also be conducted by request. Contact paramina_solutions@paramina.com or www.paramina.com for more information.
STRATEGIC MINE PLANNING (SMP) FOR OPEN PIT, UNDERGROUND & CAVING SOLUTION CAPABILITIES:
- Aggregate input data, assumptions and constraints into a central location
- Leverage historical data to correctly define mining parameters
- Determine trends and correlations between historical data
- Incorporate mine status, geotechnical constraints and operational risk
- Couple the geotechnical domain with mine extraction to model interactions (e.g. cave back propagation to material flow to cave draw points)
- Run thousands of scenarios in a design of experiments to ensure the most robust plan is selected
- Project lifecycle governance with approval traceability and version management
REFERENCE: Dassault Systèmes. (2021). Strategic Mine Planning is Essential to Ensure Long-term Viability in Changing Times.
