Search Documents

By G. G. Krishna Murthy

Several experiments were carried out to simulate the bath smelting reactions where iron oxide particles were dropped on to an iron-carbon bath containing molten CaO-SiO2-Al2O3 slag layer on its surface. The composition of the slags used in the experiments was %CaO:46.1; %SiO2:41.7; and %A1203:12.2. Experiments were con¬ducted with carbon saturated iron melts contained in either a pure graphite crucible whose walls were covered with a pure alumina tube, or a pure flat bottom alumina crucible, at 1723-1823 K. Degree of reduction of a pure iron oxide particle was linear with time in the initial stages (up to about 20% oxygen of the original pellet was reduced). The rate of reduction of smaller oxide pellets was smaller than that of a bigger pellet - the time for complete reduction of a 5.6 g wustite pellet was smaller than that for a 1.2 g wustite pellet. It was also established that the interaction rates obtained by adding a molten pure oxide particle of given weight to the system were lower than that determined by using a solid oxide particle of same weight. The overall rates of reduction decreased with decreasing the bath temperature. The experimentally determined rates of reduction based on the time for 70% reduction were influenced substantially by addition of slag up to about 50 g on to a bath of 78.8 mm in diameter, and remained constant when slag present on the bath surface was between 50 g and 200 g.

Jan 1, 1993

How the Australasian and Canadian Codes (VALMIN and CIMVal) approach mineral property valuation is described. Brief comment is also made on the International Valuation Standards CommitteeÆs interest in a global valuation standard for Mineral (Extractive) Industries and the South African SAMREC initiatives to adopt a VALMIN-like Code. The conventional tripartite classification of valuation approaches into those that are Market-based, Income-based and Cost-based is outlined. It is best practice to use as many of these approaches as possible (and as many methods as reasonable in the particular circumstances), given the quantity and quality of the data available on the Mineral Asset (which depends upon the state of development of the mineral property). The use of specific methods must satisfy the basic considerations of logic and reasonableness and the purpose of the valuation. The competence, judgement and repute of the valuer are critical factors, since all valuations are time and circumstance specific. What constitutes æMarket ValueÆ in the different jurisdictions is discussed and definitions are given. Challenges facing the globalisation of a VALMIN-type Code for the international Minerals Industry are the influence of real estate valuers and the US jurisdictional idiosyncrasies. This is mainly due to a fixation on real property rights with a preference for using real estate-like comparative sales techniques (Market Approach) to the exclusion of Income-based approaches; a regulatory reluctance in the US to accept that Resources have considerable value; and the International Accounting Standards BoardÆs preference for Historical, rather than Current Value, accounting.

Jan 1, 2002

By L. B. Hales

Expert control of grinding and flotation plants has been successfully used in the minerals industry since the 1970?s. The earliest of these systems were written in a hard-coded fashion in FORTRAN, BASIC or Pascal. Second generation systems were built using the first experimental expert system shells that were being developed in the artificial intelligence community. Later systems were deployed in expert system shells designed for real-time processing plants that also included the ability to model the process with neural network models and optimize setpoint selection through the use of genetic algorithms. Significant performance increases have been achieved using these systems, but in general, they suffer from the static nature of their rules and to a degree the process models also. Typical improvements quoted in the literature suggest throughput rate increases of 4 to 8 percent and recovery increases of 1 to 4 percentage points. In over 30 years of designing and installing expert systems we have never seen performance numbers less that these but have often seen numbers in excess of the high values. However, once the system has been installed and tuned up the performance usually does not improve much thereafter. Granted, the initial increases in throughput rate and recovery are significant but a question always lingers, that is, can the expert strategies be modified further to squeeze a little more improvement out of the system. The answer to this question is a resounding yes, however a complete understanding of what we do well as designers and operators of expert control systems is required as well as how we can improve upon our best practices is required to move us from the performance plateau we have been on for a number of years to a new higher level of performance.

Jan 1, 2009

By W. K. Hitchcock

Anecdotal evidence suggests that re-entering a sealed heating poses a significant hazard, whereby the original heating is rejuvenated at an accelerated rate forcing withdrawal and re-sealing of the area. Bulk-scale laboratory experiments using a two-metre column confirm these mine site observations. A high volatile bituminous coal from New South Wales, Australia was allowed to develop a significant hot spot before being inerted with nitrogen and allowed to cool. Air was then allowed back into the coal after the nitrogen was turned off and a hot spot developed almost immediately at the same location as the original hot spot before it quickly migrated towards the air source within a day. Two more re-entries were simulated. Each successive re-entry developed a broader hot spot and took longer to reach thermal runaway. These results clearly show the behaviour that can be expected when trying to recover a section of an underground coal mine that has been sealed due to a spontaneous combustion event.

Jan 1, 2009

By E. T. Turkdogan, Klaus Schwerdtfeger, P. Grieveson

The rate of growth of "Fe4N" on a iron was measured by nitriding purified iron strips in flowing am -monia -hydrogen gas mixtures at 504" and 554°C. It is shown that a dense nitride layer is formed when a zone -refined iron is used in the experiments. With less pure iron, the nitride layer is found to be porous. Through theoretical treatment, the self-diffusivity of nitrogen is evaluated porn the parabolic rate constant, and found to be essentially independent of nitrogen actirlity, e.g., D* = 3.2 x l0-12 and 7.9x l0-12 sq cm per sec at 504" and 554?C. Some consideration is given to the mechanism of diffusion in the nitride phase. THERE is a great deal of background knowledge on the solubility and diffusivity of nitrogen in iron, and on the thermodynamics and crystallography of several phases in the Fe-N system. Although case-nitrided steels have many applications in practice, no work seems to have been done on the diffusivity of nitrogen in the iron nitride, ?', phase. The only work reported on the related subject of which the authors are aware is an investigation by Prenosil,1 who measured the growth rate of the e phase on iron by nitriding in ammonia-hydrogen gas mixtures. EXPERIMENTS Purified iron plates of approximate dimensions 1 by 0.5 by 0.03 cm were nitrided in flowing mixtures of ammonia and hydrogen, in a vertical furnace fitted with a gas-tight recrystallized alumina tube. After a specified time of reaction, the sample was cooled to room temperature by withdrawal to the water cooled top of the reaction tube. The furnace temperature was controlled electronically in the usual manner within *l°C; the temperature was measured using a calibrated Pt/Pt-10 pct Rh thermocouple. For each experiment the iron strip sample was cleaned with fine emery cloth and degreased with tri-chloroethylene prior to the experiment. The ammonia-hydrogen gas mixtures were prepared from anhydrous ammonia and purified hydrogen using constant pressure-head capillary flowmeters. The gas mixture flowed upward in the furnace with flow rate of 400 cc per min at stp. The composition of the gas mixture was checked by chemical analysis at regular intervals. In most cases, the compositions of the exit gas and metered input gas agreed within about 0.3 pct, indicating that cracking of ammonia did not pose a problem at the temperatures employed. Two series of experiments were carried out using two different types of purified iron samples. In the first series of experiments at 550°C, vacuum carbon deoxidized "Plastiron" was used. The main impurities present in this iron were, in ppm: 4043, 50-Cr, 20-Zr, 40-Mn, 20-P, 20-S, 20-C, 50-0, and 10-N. In these experiments the rate data were obtained by measuring the change in weight of the iron specimen suspended in the hot zone of the furnace by a platinum wire from a silica spring balance. The nitride layer formed in these experiments was found to be porous, particularly near the outer surface. In other experiments, high purity zone-refined iron (prepared in this laboratory) was used. The total impurity content of this iron was 30 ppm of which 20 ppm was Co + Ni, 4 ppm 0, other metallic impurities were less than 1 ppm. The zone-refined iron bar, -2.5 cm diam, was cold rolled to a thickness of about 0.03 cm and the specimens were prepared for the experiment as described earlier. After the nitriding experiment, the sample was copper plated electro-lytically and mounted in plastic for metallographic polishing. After polishing, the thickness of the ?' layer was measured using a metallographic microscope. The nitride layer formed on the zone-refined iron was essentially free of pores. RESULTS The different morphology of the nitride layers grown on "Plastiron" and zone-refined iron is shown in Fig. 1. Both samples were nitrided side by side for 55 hr. The holes in the less pure iron, Fig. l(a), are confined to a region about one half thickness from the outer surface. The dense layer grown on zone-refined iron, Fig. l(b), is thinner than the porous layer on the "Plastiron". The impurities in the iron are believed to be responsible for the formation of a porous nitride layer. The pore formation may be due to the high nitrogen pressures existing within the nitride layer, e.g., the equilibrium nitrogen pressure is 1.2 x l05 atm in the 38.6 pct NH3-61.4 pct H2 and 6.6 x l03 atm at the Fe-Fe4N interface at 554°C and 0.96 atm. It is possible that the oxide inclusions present in the electrolytic iron may facilitate the nuclea-tion of nitrogen gas bubbles within the nitride layer. Support for this reasoning is the fact that pores are only encountered in the outer range of the layer where nitrogen pressures are largest. The photomicrographs in Fig. 2 show the effect of reaction time on the thickness of the dense nitride layer formed on zone-refined iron. These sections are from samples nitrided in a stream of 29 pct NH3-71 pct H2 mixture at 554°C for 22, 70, and 255 hr. In all the sections examined the nitride-iron interface was noted to be rugged. These irregularities are be-

Jan 1, 1970

By S. Cotten

The regulations for current coal mine refuge alternative (RAs) require that there be sufficient life support to sustain survival of the maximum number of RA occupants for a minimum of 96 hours. This minimum duration assumes that rescuers can access the RA through the mine within four (4) days of the onset of the mine emergency. But what if mine rescue teams cannot reach the miners within the RA before the RA air supply is severely limited or exhausted? What could be done to extend the duration of the RA life support capability into the 97th hour and beyond? In addition, what might be done to enable more rapid rescue of the miners if they could not be reached through the mine in a timely manner? This paper describes a systems approach to address the potential need to extend the duration of RA life support beyond current design limits. New capabilities that need to be developed in advance of such a dire need include more reliable emergency communications, highly mobile and efficient drilling rigs, enhanced directional drilling techniques, and a standardized RA external life support interface along with RA internal design modifications to accommodate use of an external supply. The following sections describe the need, intent, and technology gaps associated with each of these capabilities. Government agencies and the mining industry should consider initiation of a program to investigate, design, and develop effective means of extending the current 96-hour time restriction on coal mine refuge alternative life support. The development process should begin with a focused study to refine the overall operational concept, investigate the current state-of-the art of critical technologies, identify specific technology development priorities, and make recommendations for a development program to provide in an organized, efficient, and timely manner a solution for extended refuge alternative life support and occupant rescue.

Jan 1, 2011

By Ashok K. Sinha

The quasi-binary systems "VFe3"—VCo,—VNi,— "VCu3"and "TiFe3"—TiCo3,—TiNi3-"TiCu3"have been studied by a combination of microscopic and X-ray methods. Of the Phases encountered, eleven had close-packed ordered layer structures. Within each system, there is an approximately linear variation of the degree of hexagonality of the stacking arrangement with electron concentration, e/a. A study of eighty -four known examples of AB3 structures in transition metal alloys indicates that at e/a = 8.65 the ordered structure of the close -packed layers changes from "triangular" (AuCu3 type) to "rectangular" (SbCu3 type). At e/a < 8.65, the slope of hexagonality us e/a line increases with the group number of the A component. An interesting series of close-packed ordered structures is known to exist at the composition AB3; however, their alloy chemistry has not yet been fully understood. Dwight and Beck1 observed a correlation between position of the components in the periodic table and the type of crystal structure of the binary AB2 structures formed by transition metals. No consistent effect due to atomic size was noted and they proposed that electron concentration* predominates in In the present paper, the AB3 structures are characterized by a symbol describing the stacking and a symbol specifying the ordered layer. The stacking symbol used was introduced by Zhdanov,7 and later used in the International Tables,8 and by Beck9 in his survey of possible layer stacking structures. Alternating positive and negative integers are used to represent the number of positive (e.g., in abcabc...) and negative (e.g., in cbacba...) stacking sequences. T denotes the triangular ordering found in close-packed planes of the AuCu3 structure and R the rectangular ordering found in close-packed planes of the SbCu3 structure, Figs. 3(a) and (b). The present structure symbols are listed in Table I alongside the prototypes, where known, and other structural characteristics of AB3 phases found in the present investigation. EXPERIMENTAL The starting materials were metals of 99.9+ purity. The alloys were prepared by arc melting under argon atmosphere using a nonconsumable tungsten electrode and water-cooled copper hearth. The total weight loss upon melting and subsequent annealing was always less than 0.5 pct and hence the alloys will be referred to by their intended (unanalyzed) compositions. The alloys were homogenized and annealed at suitable temperatures in the range 750" to 1200°C, the annealing periods varying from 3 days at 1200°C to 10 days at 750°C. The heat treatments were carried out in sealed silica capsules under argon atmosphere and with a molybdenum foil cover between the alloy and the walls of the capsule. The quenched alloys were microscopically examined and reduced to powder by crushing or filing. The powders were, whenever necessary, given a stress-relieving anneal at the original annealing temperature. X-ray powder patterns were obtained with an asymmetrical focusing camera, a Guinier-deWolff focusing camera, or a Debye-Scherrer camera. Cr, Co, or Cu radiations were used. In some cases, to ensure the minimum degree of contamination, the deeply etched specimens were mounted in the asymmetrical focusing camera to obtain an X-ray pattern. Internal silicon standards were employed for lattice parameter determinations. The intensity calculations were made by using a Fortran IV program

Jan 1, 1970

By G. Kleyn

"Sub-standard practices and their adverse impact on safety performance remain a challenge in the South African gold mining industry. The purpose of this study was to investigate the root causes of sub-standard practices and the effect on safety performance in South African gold mines. The focus of the study was on the underground production operations at a gold mine in the Free State. The study consisted of three parts: a personal investigation into the causes of sub-standard practices at the mine, a comparison with the results of a cultural study performed at the West Wits mines, and a behavioural survey.The studies described in this article yielded similar results in terms of the key drivers behind sub-standard practices. It was found that substandard practices had a number of causes, and the origin lies within the habits, attitude, and behaviour of employees. Current methods of addressing sub-standard practices and improving safety performance were found to discourage employees from performing work safely and according to procedure. It was concluded that the lack of critical behavioural habits for the given work environment and job title could possibly be the primary reason for the occurrence of sub-standard practices. IntroductionSince the implementation of the Mine Health and Safety Act, 1996 (Act 29 of 1996) and the Mine Health and Safety Regulations, the South African mining industry has been striving to improve health and safety performance and has placed great emphasis on adherence to mine standards.The Act requires employers in the mining industry to report accidents, incidents, and dangerous situations to the Regional Principal Inspector of Mines in their area. The data provided by employers is captured and analysed by the South African Mines Reportable Accident Statistical System (SAMRASS) and made available for public viewing (Department of Mineral Resources, 2011).A review of the national mine-related accident statistics shows clearly that the South African gold mining industry has improved its safety performance markedly over the past decade, but is still facing major challenges (Figure 1). These include meeting the Mine Health and Safety Milestones (Department of Mineral Resources, 2011)."

Jan 1, 2016

By E. R. Parker, D. L. Martin

During the heat-treatment of silver specimens for tensile tests it was observed that the bars blistered and became brittle when heated in a hydrogen atmosphere. To check this unexpected result, a wide variety of commercial silvers were heated in hydrogen at 850°C. Only a few of the materials developed blisters, the most severe of which is the tube pictured in Fig. I. The microstructure of a cross section of the tube is shown in Fig. 2. The embrit-tlernent is extremely severe at the edge; the blisters result from the severe deformation of the surface material by large under- lying gas pockets. The effects resulting from hydrogen embrittlement of silver have been observed by numerous investigators over a long time l,2,3 although it was only recently that a clear explanation was offered.4 However, the damage resulting from hydrogen embrittlement has not been generally recognized; and it is of advantage to know more about this phe- 1 References are at the end of the paper.

Jan 1, 1943

By D. L. Martin, E. R. Parker

During the heat-treatment of silver specimens for tensile tests it was observed that the bars blistered and became brittle when heated in a hydrogen atmosphere. To check this unexpected result, a wide variety of commercial silvers were heated in hydrogen at 850°C. Only a few of the materials developed blisters, the most severe of which is the tube pictured in Fig. I. The microstructure of a cross section of the tube is shown in Fig. 2. The embrit-tlernent is extremely severe at the edge; the blisters result from the severe deformation of the surface material by large under- lying gas pockets. The effects resulting from hydrogen embrittlement of silver have been observed by numerous investigators over a long time l,2,3 although it was only recently that a clear explanation was offered.4 However, the damage resulting from hydrogen embrittlement has not been generally recognized; and it is of advantage to know more about this phe- 1 References are at the end of the paper.

Jan 1, 1943

Jan 1, 2002

By D. J. Leidel

The offshore production of oil and gas resources has been active in the Gulf of Mexico since Kerr- McGee drilled the first commercial well out of the sight of land in 1947. Since then, approximately 60% of the offshore oil/gas production structures used globally have been erected in the GOM to support the production of energy resources’. The shallow, shelf and shelf edge waters of the Gulf of Mexico have reached or are rapidly approaching production maturity, requiring that the fixed structures used to support energy production be removed or otherwise disposed of by suitable means. The use of energetic materials has been determined to be a safe, efficient and cost effective technology to remove fixed offshore structures whose service life has been exceeded.

Jan 1, 2002

By Henry Louis

THE work performed by the Royal Commission on Mining Subsidence is likely to prove of permanent value, less perhaps for the conclusions it has reached and for the recommendations it has based upon these than for the admirable exposition which it affords of the law concerning mining subsidence and of the legal status of the person who has suffered damage by reason of such subsidence, as also of him whose working has caused the damage. The Commission was appointed by Royal Warrant in the middle of 1925 and delivered its final report in the middle of 1927. The terms of reference to the Commission were as follows: "To consider the operation of the law relating to the support of the surface of the land, and of buildings or works on or under the surface, by underlying or adjacent minerals; to enquire into the extent and gravity of the damage caused by subsidence owing to the extraction of minerals and the incidence of the resulting liability; and to report what steps should be taken, by legislation or otherwise, to remedy, equitably to all persons concerned, any defects or hardships that may be found to arise in existing conditions."

Jan 1, 1929

By F. Mielli

Camera systems and video surveillance are usually associated with people and asset protection. However, they can be applied in a mine environment beyond conventional surveillance: For process monitoring, collision avoidance, sizing, flotation cells, conveying systems, blasting, objects and people tracking, thermal profile, and to automatically identify equipment that is missing parts,. Image and video solutions can be driven by better integration of powerful video analytics and cameras systems in automation tools such as process controllers and supervision systems.

Feb 27, 2013

By W. B. Paton

Introduction For several reasons the accident history of Flin Flon has been quite unlike that of any other mine in northern Canada, and very much unlike that of the average American metal mine. Towards the end of 1928, the mining project that is now Flin Flon, and that is now in the very: forefront of Canada&apos;s big producers was launched; but, metaphorically, it was launched in a tempest of mining troubles. Each branch of the mammoth enterprise was beset with extraordinary difficulties, and the Safety Department had its relative share. Difficulties in Accident Prevention The unusually rugged contour of the plant site made roads, and even moderately safe pathways, out of the immediate question. The project established an industrial outlet for depression-stricken areas which hitherto had been essentially agricultural; but through that outlet poured labour whose working atmosphere had been the bald prairie, labour that knew nothing of safety consciousness, labour that had to be moulded to industrialism, labour in the raw. A considerable length of the ore-body lay under the eastern section of Flin Flon lake. Open-pit methods were adopted to work the upper limits of the ore-body, and consequently the eastern section of the lake had to be dammed and pumped dry. The subsequent difficulties and hazards created by silt deposit cannot be fully visualized. And, finally, there was a geographical hindrance: the ore-body was partly in the Province of Manitoba and partly in the Province of Saskatchewan. The workmen&apos;s compensation problem became intricate. Insofar as accident prevention is concerned, Flin Flon&apos;s young industrial life may be conveniently divided into three distinct periods, namely: (a) Construction (Nov. 1928-June 1930) (b) Tuning up, and production till the strike (June 1930-June 1934) (c) Production from the strike till the present time At the peak of construction, due to the usual labour fluctuations of big jobs, there was a weekly turnover of about a hundred men. A very large percentage were Central Europeans, most of whom could neither read nor write English. Consequently, an organized safety programme was out of the question.

Jan 1, 1935

By Burk, Hugh A.

AT THE inception of the cyanide process and its adaptation to the practice of gold and silver metallurgy much difficulty was experienced in applying it to auro-cupriferous ores, both in economy of treatment and recovery of the gold from solution. The presence of copper in the ore effected a high chemical consumption of cyanide during treatment, and in the solvent solution, it retarded the precipitation of the gold on zinc shavings. The coating of the copper on the zinc shavings presented even worse difficulties than the increased cyanide consumption as most ores contain a small amount of copper. This interference of copper led to the use of other precipitating methods and attempts to recover the cyanide which was consumed during ore treatment. Of the other methods used, electrolytic precipitation was the most practical until a better understanding of the application of zinc shavings and zinc dust developed. In September, 1905, a patent entitled, "Method for Recovering Precious Metals from Solution," was granted to Isaac Anderson and Michael Scanton. This method is adaptable to precious metal ores containing a small percentage of copper but has never been extensively used or perfected. The process has

Jan 1, 1925

By Juan Carlos Salas

In this paper, a collaborative R&D model which has been successfully applied by a global mining companies association is presented and analysed both from the conceptual and practical point of view and an example of these collaborative initiatives, the Copper Technology Roadmap recently generated by a group of the most relevant copper mining companies, is presented, including an analysis of strategic opportunities and challenges in the Latin American region.

Sep 9, 2007

By G. Viramontes-Gamboa, A. Encinas-Oropesa, S. Velázquez-Roque, L. A. Ibarra-Bracamontes

Some industrially relevant applications for pyrite nano/micro-particles have been proposed in the literature, such as the catalysis of chalcopyrite leaching, the removal of As(III), As(V) and Cr(VI) from solution, as photovoltaic devices, and others. Even though pyrite can be recovered from solution by flotation, for some applications it may be beneficial to provide pyrite with magnetic properties. In this work, a methodology to synthesize magnetic shell/core composites made of pyrite as the shell and either natural or synthetic magnetite as the core is presented. The size of the magnetic composite may range from tenths to hundreds of microns. The synthesis is basically made by stoichiometrically mixing iron nano/micro-particles with sulfur microparticles with magnetite particles, and bringing the mixture in an oxygen free atmosphere from 200 to 300 °C for 4 h. The composites were characterized by optical microscopy, Scanning Electron Microscopy and X-Ray diffraction.

Jan 1, 2014

By V 7. 0 / 300 dpi

LAST fall, having a number of ore samples from mine-development work carried on in spite of the "Revolution," I was forced to do my own assaying again, after a lapse of many years. This gave me an opportunity to build a furnace for crucible assaying, using wood for fuel, along lines which had been developing in my mind since the time 20 years ago, when as general factotum at a little mining camp in western Chihuahua, Mexico, I had converted a crucible charcoal furnace into one using the reverberatory principle. Wood-burning furnaces have been described in technical literature, but I believe the present application will prove helpful to those of the profession who are working in out-of-the-way places. The furnace is shown in detail in Figs. 1, 2 and 3. Remembering the trouble caused by stoking my first charcoal furnace too heavily, I fired this one with but a few sticks of wood at a time. By this method I could run out a charge of 12 crucibles in 30 to 35 min., using 50 sticks of ordinary stove wood. Later I fill up the firebox, holding about 40 sticks, get everything ready, put the crucibles into the melting chamber and "fire up." Just as soon as the fire is well started the draft door is closed and the furnace allowed to heat up slowly for 5 min. Then the draft is opened (the door to the ash-pit) and the fire allowed to roar, which it does. In 20 min. from the time the fire is lighted the fire door is opened, the fire stirred along the grates, and 5 or 6 more sticks of wood thrown in. In 25 min. from the start, the draft is closed again, the cover of the melting chamber pushed back and the charges poured. The melts will be found to be perfect, and the crucibles to pour absolutely clean, if everything has gone right, as will usually be the case. A new charge may be put in, and fired with S to 10 sticks of wood at a tine, and be ready to pour within 20 min.; but it is just as well to leave the crucibles in the melting chamber a full 2.5 min. By using 10 sticks of wood to start the fire and adding 5 sticks as often as needed, which will be as soon as the last sticks fed in are in perfect combustion, the smelting can be completed in from 30 to 35 min., using from 35 to 40 sticks of wood. I consider this to be the best method of stoking.

Jan 10, 1914

By Sabry A. Sabour

Metal price is among the key variables in the open pit optimization and the economic evaluation process. The common approach to handle metal prices in open pit mine planning is to optimize the ultimate pit and the mining schedules using a fixed, flat metal price. In this respect, metal price is assumed to be known with certainty throughout the entire mine life, which in some cases can reach 80 years. Given the volatile nature of metal markets and the metal price cycles, the conventional pit optimization approach may generate sub-optimized mining plans, which results in either extra costs to mining projects or lost revenues, or both. Long-term operational decisions such as future pit expansions, beyond the currently optimized limits, cannot be handled using the pit optimization approach based on flat metal prices. There is a growing interest in the mining industry to model and manage such market uncertainty in the pit optimization as well as the project evaluations in order to maximize the value of mining operations. In this paper, the author will outline a practical approach to optimize the ultimate pit taking into account the volatility and variability of metal markets. The proposed approach uses a combination of the pit optimizer of the commercial MineSight package and a simulation-based economic modeling real options valuation approach employing the least-squares Monte Carlo algorithm. MineSight pit optimizer employs both the floating cone for initial optimization exercise and the standard Lerchs-Grossmann algorithm. In this paper, Lerchs-Grossmann option will be used to generate the pit shells. Real options valuation approach used in this study is based on generating multiple metal price scenarios. Metal price uncertainty is modeled using stochastic metal price models such as the geometric Brownian motion and the mean-reverting process. The mining operational scenarios corresponding to the simulated metal prices are then optimized using the least-square Monte Carlo approach. The objective is to maximize the discounted cash flow value of the project while incorporating the operating flexibility to revise the operating status of the open pit with time as new information becomes available. The focus of this work is on the practicality of the proposed uncertainty-based pit optimization approach and the difference it can make to the technical operational mining decisions. A case study of a hypothetical open pit poly-metallic mine is provided. The deposit contains copper, gold and silver grades. The run of mine ore is sent to the process plant that produces copper concentrate with copper as the main metal and gold and silver as the by-products. Four uncertain variables are considered here include copper, gold, silver prices and foreign exchange rate. Both copper price and exchange rate are modeled using the mean-reverting process while gold and silver prices are modeled using the geometric Brownian motion. The case study is performed using both the conventional flat price pit optimization approach and the proposed uncertainty-based one to compare results.

Aug 1, 2013