Production rate optimisation – avoiding the temptation of tonnage
P. McCarthy
8
Strategic versus Tactical Approaches in Mining 2011, Perth, Australia
Table 1
Values of k for selected Australian
metal mines, annual data
Period
Minerals
Method
k
R
2
Comment
Osborne
1997–2005
Cu/Au
UG
2.10
0.536
Mt Lyell
1934–1974
Cu/Ag/Au
Mainly OC
1.21
0.358
Peak
1993–2008
Pb/Ag/Zn/Cu/Au
UG
1.12
0.610
Mt Lyell
1900–1933
Cu/Ag/Au
UG and OC
0.94
0.526 Early years of mining
Mount Morgan
1933–1981
Cu/Ag/Au
OC
0.52
0.214
Broken Hill
1900–2008
Pb/Ag/Zn
UG
0.51
0.400 Multiple mines on
one orebody
Argyle
1979–2008
Diamonds
OC
0.48
0.192
Rum Jungle
1954–1970
U/Cu
OC
0.48
0.342
McArthur
River
1995–2008
Pb/Ag/Zn
UG
0.41
0.458
Kambalda
1967–2004
Ni
UG
0.36
0.597
Century
2000–2008
Pb/Ag/Zn
OC
0.35
0.563
Mary Kathleen
1959–1982
U
OC
0.34
0.146
CSA
1968–2007
Pb/Ag/Zn/Cu
UG
0.29
0.122
Olympic Dam
1988–2008
Cu/U/Ag/Au
UG
0.28
0.811
Cannington
1997–2008
Pb/Ag/Zn
UG
0.28
0.648
Rosebery
1937–1980
Pb/Ag/Zn/Cu/Au
UG
0.28
0.705 Milled multiple
mines after 1980
Ranger
1982–2008
U
OC
0.27
0.611
Woodcutters
1986–1999
Pb/Ag/Zn
Mainly UG
0.26
0.218
Mt Lyell
1975–2008
Cu/Ag/Au
UG
0.21
0.170 Non-selective caving
since 1995
Moonta
1890–1923
Cu
UG and OC
0.21
0.162
Woodlawn
1979–1989
Pb/Ag/Zn/Cu/Au
OC
0.13
0.113
Mt Isa Copper
1943–2008
Cu
UG
0.11
0.151
Mt Isa Lead
1931–2005
Pb/Ag/Zn
UG
0.10
0.271
Table 2
Values of k for selected Australian
gold mines
Name
Period
Minerals
Method
k
R
2
Comment
Beaconsfield
1999–2010
Au
UG
0.88
0.207 Quarterly data
Henty
1996–2007
Au
UG
1.02
0.641 Six monthly data
The two gold mine examples are from narrow-vein high-grade mines, suggesting that a value closer to k = 1
may apply. More research is required. The use of k in optimisation is illustrated in the following two
examples.
Keynote Address — Strategic Planning and Scheduling
Strategic versus Tactical Approaches in Mining 2011, Perth, Australia
9
5.1
Example 1
A mine is operating at a rate of 1 Mtpa at a head grade of 2% Cu. An expansion to 1.5 Mtpa
is proposed and
a value of k = 0.3 is inferred from similar deposits. The new head grade can be calculated from:
G
2
= G
1
(1 - k (t
2
- t
1
)/t
1
)
(2)
G
2
= 2 × (1 - 0.3 × (1.5 - 1.0)/1)
G = 1.7% Cu.
5.2
Example 2
A planned underground gold mine is based on an ore reserve of 18 Mt at 5 g/t Au. The orebody extends
over 600 vertical metres. Adopting an equivalent vertical advance rate of 50 m/year gives a mine life of
12 years and a production rate of 1.5 Mtpa. It is assumed that the competent person preparing the ore
reserve estimate allowed for dilution at a mining rate of 1.5 Mtpa. A value of k = 0.5 is inferred from similar
deposits. Using the approach in Example 1, the following head grades can be predicted:
Rate (Mtpa)
Grade (g/t)
0.5
1.0
1.5
2.0
2.5
6.7
5.8
5.0
4.2
3.3
This information can be used in financial modelling to further optimise the production rate.
6
Estimating the value of k
As a first approach to estimating the grade-rate relationship, it is possible to estimate the head grade that
would result from applying the selected cutoff grade at specific mining rates as follows:
Assuming that the exploration drilling is representative, at a mining rate of zero (i.e. with infinite
selectivity) the head grade would be close to the average grade of the above-cutoff drill intercepts
composited to minimum mining width. From this the intercept value on the
grade axis can be
derived.
Using the most selective practical mining method the resulting head grade can be estimated from
the dilution history of similar operations. Such selective methods might include the use of a 1.0 m
wide bucket on a 60 t excavator in an open pit, or hand-held cut and fill underground mining. In
either case intensive grade control would be assumed and a vertical advance rate of around 30 m
per year might be expected.
Using a conventional approach to planning with a vertical advance rate of around 50 m per year,
the head grade at the chosen cutoff grade can be estimated.
An upper limiting case occurs in an open pit when the rate is limited by the highest benches and
the largest equipment that can operate within the pit. In an underground mine,
the limit might
occur using sublevel open stoping with a highly regularised stope shape and unlimited advanced
development. In either case a vertical advance rate approaching 100 m per year would apply. The
geometric dilution would be substantial and grade control would be ineffective.
A limiting value for k is set by assuming that the additional tonnage mined is all pure waste.
Using the above point estimates, a curve can be fitted to give a grade-tonnage relationship, or to estimate
the value of k, for any selected cutoff grade.
Production rate optimisation – avoiding the temptation of tonnage
P. McCarthy
10
Strategic versus Tactical Approaches in Mining 2011, Perth, Australia
An example is provided by the history of one high-grade gold deposit. Highly selective mining in the 19th
century gave a head grade of 90 g/t Au, whereas modern hand-held cut and fill methods gave a head grade
of 30 g/t Au. This fell to 15–20 g/t Au using mechanised cut and fill and was
estimated to have fallen
further, to an estimated 10 g/t Au, if sublevel benching had been attempted. The cutoff grade was about
the same for each period; only the rate of mining changed, with an associated impact on dilution.
7
Conclusion
The mine production rate should be selected based on studies which will identify the maximum return on
investment over a range of sensitivity scenarios. While unit (per tonne) capital and operating costs may be
reduced as the mining rate is increased, other negative influences become important. The influence of the
mining rate on head grade is a key consideration. Mine planning models should incorporate a mechanism
for recognising the real-world relationship between mining rate and head grade.
References
Hoover, H.C. (1909) Principles of Mining, McGraw-Hill, New York, pp. 153–160.
McCarthy, P.L. (1993) Economics
of Narrow Vein Mining, in Seminar Narrow Vein Mining, Australasian Institute of Mining and
Metallurgy, 17–18 June, Bendigo, Australia, pp. 89–97.
McCarthy, P.L. (2010) Setting Plant Capacity, Metallurgical Plant Design and Operating Strategies, Transactions of the Institution of
Mining and Metallurgy – Section C, Vol. 119, No. 4, pp. 184–190.
Mudd, G.M. (2009) The Sustainability of Mining in Australia: Key Production Trends and Their Environmental Implications for the
Future, Research Report No RR5, Department of Civil Engineering, Monash University and Mineral Policy Institute, Revised
April 2009.
Smith, L.D. (1997) A Critical Examination of the Methods and Factors Affecting the Selection of an Optimum Production Rate, CIM
Magazine, Bulletin Vol. 90, No. 1007, February 1997.
Tatman, C.R. (2001) Production Rate Selection for Steeply Dipping Tabular Deposits, Mining Engineering, October 2001, pp. 62–64.