Computerized cost estimating for underground mines

"A computerized cost estimating program developed with the use of the Lotus 1-2-3 spreadsheet program has produced dramatic savings in preparing estimates for operating costs, equipment fleet size and manpower requirements for underground mines.The program is used by Dynatec to support its consulting engineering projects, particularly feasibility studies. The 'first principles' approach is used to prepare detailed estimates under direct labour and supplies categories and maintenance costs for each mining operation . User notes have been developed to guide the estimator and ensure appropriate consideration is given to the specifics of the particular mine.A typical case history is illustrated and the ease by which alternatives and sensitivity analyses can be prepared is demonstrated. IntroductionHistorical MethodsMining engineers have used one or a combination of methods to prepare operating cost estimates for new or existing mine s. Operating companies have access to historical cost data and generally use this for preparing estimates. Consulting engineers do not usually have direct access to such information and must rely on mining companies (the present or previous clients); publications (text books, equipment manufacturers manuals, CMJ reference manual, etc.); annual reports (applicable to public companies); previous studies (to be used with caution as conditions change from mine to mine); and first principles (the subject of this paper), for cost information:Definition of First PrinciplesA first principles approach to cost estimating considers individual primary work elements of an operation. Quantities of work items are developed from the mine plans, production rates, geographic and physical layouts etc. The knowledgeable estimator, assisted by experienced operations personnel, can assign appropriate resources (equipment, labour, supplies and services) to each work element and establish productivities. Completion of the cost estimate is then largely arithmetic."