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By M. Mahdi, L. So, A. MacMillan, D. Metcalfe, J. Woloshyn, D. Sauter, N. Uys, JP. Janse van Rensburg

For city smelters, with limited real estate, efficient slag cleaning furnaces followed by water granulation to produce an iron silicate product is the preferred process approach. Water granulation, however, consumes large volumes of water and requires high maintenance due to abrasive slag/water slurries. Air granulation offers an alternative to water granulation, which eliminates water use and has low maintenance requirements. Although full-scale operation has not been implemented for copper slags, full-scale operation for platinum group metal (PGM) converter slag has been implemented. A review of full-scale air granulation performance for PGM converter slag is provided. Based on PGM converter slag granulation performance, parallels to copper slag granulation are drawn and full-scale operation for copper slag is modelled using computational fluid dynamics (CFD). INTRODUCTION Typical slag management practices in the copper industry include dumping, slow air cooling, and water granulation, as shown in Figure 1. Dumping is the most commonly used slag handling method for most metal production plants, but presents challenges including the requirement for a large slag pit, requirement for expensive/high-maintenance “hot” mobile equipment, risks associated with transportation of molten slag, and no value recovery from slag as a sellable by-product or from slag as a source of heat.

Jan 1, 2019

By Dwayne D. Tannant

The Fox Pit at EKATI Diamond Mine reached a depth of approximately 150 m as of September 2005. The pit is designed with 11 m wide benches excavated using a double benching technique leaving 30 m high bench faces. A series of blasting tests were conducted to improve catch bench reliability and increase the percentage of benches that meet an 11 m catch width. The design changes focussed on reducing damage to the bench crest because maintaining the bench crests is the most important factor in achieving good bench reliability. The most significant improvement was obtained by raising the bottoms of the lower trim blastholes by 0.5 m. This change decreases the depth of broken rock below the final bench elevation, and consequently reduces damage to rock that forms the bench crest below. Another improvement was the use of smaller diameter (165 mm vs. 270 mm) blastholes in the A and B rows for the upper trim blast. This change reduces the charge per delay during detonation, reduces the powder factor slightly, and reduces the energy affecting the final pit wall and crest. As mining and the blast testing progressed, the portion of the bench with crest achievements (>11 m) increased from 57% to 75%.

May 1, 2006

Heap leaching accounts for around 20% of the global production of copper. In heap leaching coarsely crushed ore particles are contacted with an aqueous lixiviant percolating through large packed beds (heaps) of the ore particles, with the loaded solution collected at the foot of the heap for metal recovery, solution make-up and recycle. While dominant for copper oxide acid leaching, it finds application also in copper sulphide (bio) leaching. Despite their apparent simplicity, heaps are in fact complex chemical reactors in which a number of competing sub-processes determine the overall rate of metal extraction. Therefore, meaningful prediction of copper production rates from heaps, as well as operational optimisation and control, all hinge on a comprehensive and quantitative understanding of these complexities. The paper gives a comprehensive overview of the various sub-processes in copper heap leaching and their interactions, including those relating to mineral-particle-solution-gas phase interactions at the micro-scale bulk transport and distribution of solution in unsaturated dense beds at the macro-scale. On the basis of a more fundamental understanding and modelling, the potential for optimized operation offers new opportunities for the extraction of value from both low-grade and complex polymetallic ores. INTRODUCTION Heap leaching is one of the percolation leaching technologies, which includes in situ leaching, dump leaching, heap leaching and vat leaching (Bartlett, 1998). The common phenomenon in all these technologies is the transport of leach solution through a fixed bed of ore particles, which interacts with the solid as it migrates along its path. The target minerals are released into solution and with its flow are carried out of the bed. The targeted dissolved metal species are recovered from solution through various hydrometallurgical techniques, especially solvent extraction (SX), before the barren solution is returned to the leach process. Heap leaching is practised in three main types of applications: sulphuric acid leaching of copper oxide ores, cyanide leaching of gold ores as well as the oxidative acid leaching of secondary copper sulphide ores, usually with the assistance of certain microorganisms and, more recently, in the presence of chlorides (CaCl2, sea water). While gold heap leaching dates back to the 1960s, large scale copper heap leaching commenced in Chile from the 1980s, and sulphide heap leaching emerged essentially as a consequence of acid leaching from mixed oxide/sulphide ores from the 1990s (Watling, 2006).

Jan 1, 2019

By T. Saksala

In this paper, the embedded discontinuity approach is applied to finite element modeling of rock fracture. A rate-dependent constitutive model based on the embedded displacement discontinuity theory is developed to describe the mode I, mode II and mixed mode fracture of rock in tension and compression. The bulk material is described as linear elastic until reaching the elastic limit. Beyond this limit, a ratedependent exponential softening law governs the evolution of the embedded displacement jump. The present approach incorporates the rock heterogeneity by random description of the mineral texture of rock. Moreover, the inherent initial microcrack populations of natural rocks are accounted for as randomly oriented embedded discontinuities. Numerical examples demonstrate the model behavior in uniaxial compression and tension. The effect of loading rate and confining pressure is tested as well in 2D numerical simulations. These simulations show that the model captures the main features of rock in confined compression and uniaxial tension. The developed method has the computational efficiency of continuum plasticity models. However, it has an important advantage of accounting for the orientation of introduced microcracks.

Jan 1, 2015

By Y. Hou, E. Arinaitwe, L. Tong

A series of dense medium separation (DMS) tests were performed on four low-grade copper ores from Mount Polley mine in order to determine their amenability to pre-concentration. The tested ores contained disseminated sulphides, mostly chalcopyrite with low copper grades (0.15% - 0.2%) and relatively high iron grades (4.76% - 5.63%). The samples were screened into different size fractions ranging from 9.5 mm to 50.8 mm and DMS tests were performed on each size fraction at various separation densities. The pre-concentration efficiency at different size fractions and separation densities was evaluated in terms of metal upgrading and distribution. Mineralogical tests were also performed on selected DMS sink and float samples in order to understand the influence of mineralogy on the pre-concentration efficiency. The results showed that significant copper upgrading was achieved for intermediate size fractions only at the highest separation density tested. The copper recoveries generally increased with particle size at all separation densities. However, it was impossible to upgrade the copper content in the ores and achieve acceptable recoveries and mass rejections at the same time. Copper recoveries and grades showed a strong correlation with iron recoveries and grades indicating that it is possible to pre-concentrate copper by recovering magnetite and other iron-containing minerals in the ore. Overall, the results suggest that the optimum separation density and pre-concentration efficiency is a function of particle size, and that the ore mineralization properties limit the performance of DMS as a pre-concentration technology for such low-grade disseminated ores.

Jan 1, 2014

By S. Malkin, Z. Shi, H. Attia, D. Chellan

An experimental investigation is reported on creep-feed grinding of a nickelbased alloy (IN718) using conventional aluminum oxide grinding wheels. Straight surface grinding expe.riments were conducted on nickel-based alloy blocks over a wide range of grinding conditions with straight oil as- grinding fluid applied at high pressure. Grinding power, forces, workpiece surface roughness, and radial wheel wear were measured. Specific material removal rate as high as 64 mm2/s was Used without burning the workpiece, which can be attributed to the extremely low specific energy of 12.6 J/mm3. It was found that the grinding wheel under the present test conditions had a strong capability of self-sharpening as indicated by the stabilized power, forces, and surface roughness after an initial short transient.

Jan 1, 2006

By J. Duriez, L. Scholtès, F. V. Donzé

"Fracture propagation process in brittle rock is investigated by means of numerical simulations performed with an adapted formulation of the discrete element method. The progressive failure mechanism is simulated through the breaking of the bonds making up the cohesion between the elements constituting the simulated medium. The use of appropriate contact laws associated to a near neighbor interaction feature provide the model the ability to reproduce fundamental characteristics of brittle rock behavior such as, for example, high values of the tensile to compressive strength ratio. Great attention is given to accurately describe the properties of the pre-existing joints or faults in the model. A specific joint model gives the possibility to define a tailor-made behavior of the discontinuity surfaces without suffering from discretization bias.Compression test simulations are performed on pre-flawed samples and compared to experimental results in order to validate the numerical approach for describing the initiation and propagation of fractures in brittle rock under mode I+II loading. It is shown that the crack mechanical parameters can greatly influence the fracturing pattern, in particular its frictional properties. Overall, the numerical simulations reproduce fairly well the failure patterns that are obtained experimentally.The discrete model is then used to study mode I+III loading to give an insight into fracturing problems occurring at the scale of the continental crust. The ability of the model to support mechanically the physical modelings performed with wet clay or sandbox is shown. As an example, the model is used to track the development of a twist crack system (wrench fault) through the nucleation and coalescence of microcracks."

Jan 1, 2015

By R. De Ruiter

"In times when mines are emphasizing cost reductions, a properly rebuilt shall conveyance can be more cost-effective than building a new unit. Awareness of the safety aspects of conveyance design along with proper maintenance playa large part in reducing operating costs. A knowledgeable operator can maintain a high level of safety and significantly lengthen the service life of a conveyance. Such an operator is also in a better position to determine when a major overhaul is necessary.After the decision has been made to rebuild, operators must decide who will do the overhaul. Whether the work is to be done in-house or contracted out, the goal is to achieve a conveyance recertified to ""as new"" condition. By dealing with conveyance rebuilds as an engineered product, operators can be certain they are getting a top quality product for their money.This paper deals with the engineering aspects of conveyance rebuilds. Actual examples of typical problems are discussed and corrective action outlined. Design considerations such as proper material selection, component fatigue due to cyclic loading, effects of stress concentrations and corrosion are all part of the initial design considerations that must carryover into the rebuild process. All too often equipment overhauls are done by people who are not experienced in conveyance design.As a manufacturer of mining equipment, Wabi has gained expertise over the past 70 years. By sharing this knowledge the company hopes to create a safer work environment and help to reduce operating costs."

Jan 1, 1994

By G. Riveros

A new, continuous fire refining process for copper has been developed and tested at the 5 tph pilot scale. During oxidation, the blister copper flows through a packed bed of crushed refractory bricks counter-current to a hot oxygen containing gas. The resulting desulphurized copper flows then directly into a packed bed of charcoal for deoxidation. By controlling the air to natural gas ratio, both temperature and reducing conditions can be controlled. Based on extensive laboratory scale measurements of the rate of copper oxidation and reduction, the process concept was developed aided by process modeling and simulation. The industrial-pilot scale installation built at the ENAMI Paipote smelter in Chile, consists of two cylindrical, compact reactors, operating in line, with a designed capacity of 5 t/h of blister copper. The results of the industrial-pilot tests confirmed the feasibility of the new process. The blister copper processing capacity was increased to 10 t/h with satisfactory sulphur removal. The degree of oxidation as well the copper temperature was controlled with relative ease. The specially designed siphon block allowed for smooth tapping of the oxidized copper and separation of refining slag. The reduction of oxidized copper in the packed bed of charcoal appeared to be very effective while control of the degree of reduction according to the height of the bed ensured control of the oxygen content in the refined copper at the required level.

Jan 1, 2007

By S. Zakaria

"Inco's Automated Haulage Truck System (AHT) is a revolutionary automatic guided vehicle that performs all load, haul and dump operations without human intervention. The high level of sophistication and the short period it has been in operation has only allowed a select few Inco personnel to become familiar with the ART operation and maintenance. As an aid to operations an expert system using the knowledge gained from the experienced specialists was implemented in the field.The AHT operating and maintenance assistance expert system will reason through the information given, arrive at conclusions and give advice to operations, technical and management personnel. It will provide comprehensive real-time troubleshooting assistance for the hydraulic, electrical and mechanical subsystems of the ART. The ART expert system has many benefits to Inco which include increased skill levels of ART operations and maintenance personnel, reduction in ART downtime, standardization of troubleshooting procedures and reduction in ART operating and maintenance costs. In the future, the expert system application will be linked to SCADA (Supervisory Control and Data Acquisition), maintenance and statistical software to display current and historical trends of variables from a centralized historical database. As well, a wide variety of features will be integrated into the system including AutoCad drawings, graphics, photographs, voice and video capabilities."

Jan 1, 1994

By Y. M. Shneerson, I. V. Fomenko, M. A. Pleshkov, E. A. Ospanov, A. A. Shakhalov, S. S. Naboychenko

Low-grade copper concentrates (with copper content less than 20%) often contain impurities such as arsenic, zinc, lead, mercury, antimony and bismuth. The pyrometallurgical treatment of such concentrates is associated with several problems, which will ultimately affect the cost and the quality of copper cathodes as well as by-products. SRC Hydrometallurgy proposed a complex hydrometallurgical technology which allows the removal of impurities and the enrichment of low-grade copper concentrates to a quality which will be more suitable for pyrometallurgical processing. Laboratory batch tests and pilot plant results for the pressure leaching steps are shown in this paper. The key parameters of the leaching steps were determined and optimized. The quality of possible by-products were also determined. The developed flowsheet includes two pressure leaching steps: pressure oxidation (POX) and hydrothermal alteration (HTA). Both operations are carried out at 170°C with subsequent flotation of POX and HTA residues and recovery of copper, zinc and lead into separate concentrates for further processing. The development of the flowsheet was based on the Balkhash Zinc Plant (Balkhash, Kazakhstan), which had been non-operational since 2009. The developed flowsheet for processing of low-grade concentrates will utilize 80% of the existing equipment of the Balkhash Zinc Plant, thus leading to a significant reduction in required capital expenditure. INTRODUCTION As the age of copper mining operations advance, copper grades continue to diminish and impurity levels increase. Therefore, copper producers are forced to look for new innovative hydrometallurgical technologies which are able to handle low-grade raw materials and solve problems associated with impurities in an economically justifiable way. New technologies allow to extract valuable components selectively and to process low-grade concentrates which had previously been marked as non-technological and economically unviable. Hydrometallurgical technologies for processing of copper-containing materials can be divided into two main categories: chloride and sulfate (atmospheric, autoclave and bacterial) based technologies. Since the 1970s, many autoclave techniques for the processing of copper-containing materials have been developed and implemented (Naboichenko, 2002; Dreisinger, 2005; Habashi, 2009; Shneerson, 2011). The mineralogical composition of the ore (or concentrates), geographical location of the deposit, distance from industrial areas, availability of existing treatment facilities, availability of skilled labor, cost of electricity and cost of neutralization are some of the factors which are usually considered when the appropriate technology is selected (Halbe, 2002).

Jan 1, 2019

By V. Itkin

"Three methods were tested for the beneficiation of aluminum scrap, generated by heavy medium separation of non-ferrous automobile scrap residue. These were: crushing in a shredder followed by screening; grinding in a ball miff followed by screening; and eddy current separation. The best results were obtained with the grinding-screening method. IntroductionThe usual method of aluminum alloy reclamation from non-ferrous automobile scrap residue consists of a two-step heavy medium separation to remove materials lighter than and heavier than aluminum. The resulting aluminum scrap still contains over 15% impurities such as stones and glass, heavy rubber, insulated copper wire , plastics and heavy metals entrapped by macerated aluminum piece s, composite fragments, etc.(2). Upon melting, these impurities create difficulties and yield a low ingot recovery-65% to 70%, hence small foundries avoid this material.There are a number of ways to improve the quality of aluminum scrap such as:(1 ) crushing of the scrap, which powders the brittle content , a major impurity component, followed by screening out of the dust(2) eddy current separation , which removes metals from the material flow, and(3) implement better methods for density separation.The eddy current separation and two variants of the comminution-screening technique were studied by Intermetco Ltd., Hamilton , Ontario."

Jan 1, 1986

By Randolph A. Pax

"The internal operation of a tumbling mill is a very hostile environment and precludes the sustainable operation of internal sensors to measure the mechanisms of charge motion and breakage events. Instead indirect methodologies are required to expand the current understanding developed within a framework of perfect mixing of the mill contents. A number of measurement approaches have been successfully used to explore the operation of SAG mills including strain instrumented lifter bolts, mill shell strain measurement and thermal (energy balance) of operating mills.Early acoustics measurement was developed by Hardinge using a 'microphone' located close to the expected toe location. This signal was an indicator of the mill fill. Improvements were implemented with the use of two microphones straddling the toe location to try to increase the sensitivity of the measurement and reduce ambiguities. Further improvements included a filtered signal indicative of steel interactions. Unfortunately, the mechanisms of signal generation and the complexity of the processes do not provide a consistent signal.In recent years, advanced acoustic measurement using arrays of microphones utilising signal processing techniques have been implemented as SmartNoise and validated on over 30 mills. This paper will discuss the results obtained with signals such as water holdup, mill shell steel hits and two each of the toe and shoulder angles. An estimate of the internal mill component wear rates is also accessible.Advanced acoustic measurements with wide bandwidths when combined with physics models and process understanding has achieved a step change in the understanding of the dynamic internal operation of a tumbling mills on time scales of 80 ms. These techniques have been used extensively on SAG mills, but have also been applied to FAG and ball mills. Acoustic measurement is used for the rapid diagnosis of mill conditions and holistic control for optimisation and stability."

Jan 1, 2016

By M. Leroux, S. R. Rao, J. Kim, J. A. Finch

"Continuous in-plant testing of collectorless Cu/Pb bulk flotation on Lyon Lake ore at Matlabi Mines Ltd. Was conducted using a portable circuit based on 5 L mini flotation cells. It is concluded that collectorless Cu/Pb flotation is a reliable phenomenon for this ore over the usual range of plant operating conditions.IntroductionFlotation of some sulphide minerals without the use of conventional collectors (e.g. xanthates) is now widely recognized. The requirement appears to be some degree of oxidation, although the nature of the surface product formed is still uncertain (Luttrell and Yoon, 1984; Buckley and Walker, 1988). The phenomenon has been termed ""collectorless"" or ""self-induced"" flotation. One of the minerals most responsive to coUectorless flotation is chalcopyrite; in contrast pyrite and sphalerite show little response and galena usually shows intermediate response (Hayes et al., 1987; Shannon and Trahar, 1986).Most of the work on collector1ess l1otation has involved single mineral or batch flotation on ore samples. There are only occasional references to collector1ess l1otation under plant conditions (Sandstrom and Jonsson, 1988; Vargas, 1990; Boyce et al., 1970). Creating and maintaining the appropriate oxidation conditions and differences in water quality are among the reasons why the phenomenon may not transfer readily to the plant (Grano et al., 1990). Periodically from the spring of 1989, Mattabi Mines Ltd. ran full-scale tests of collector1ess bulk CulPb flotation while treating Lyon Lake ore*: the observations confirmed the laboratory finding that chalcopyrite and galena floated without collector (Leroux et al., 1989).To explore this finding continuous in-plant testing using mini flotation cells was conducted which is the subject of this paper. The main objective was to determine if collectorless flotation was a reliable phenomenon over the expected range of redox conditions in the feed pulp to bulk CulPb roughing. As background, the previous work (Leroux et al., 1989; Martin, 1988) is briefly reviewed."

Jan 1, 1994

"High Pressure Grinding Roll (“HPGR”) technology is applied in a broadening range of minerals processing applications for relatively wet or moist materials. HPGR grinding of dry material or involving drying and air classification is more common, for example in cement manufacturing. A number of minerals processing plants are also operating with dry material, either due to process reasons, such as considerations of preceding or subsequent process stages, or as dictated by local conditions of arid areas and scarcity of water. The present world-wide expectation of decreasing availability of water supply urges us to look for alternatives that minimize water consumption.Recently established and envisaged future HPGR applications with dry ores have indicated that the technology of dry crushing and classification as practiced in cement and limestone grinding can be applied in minerals processing. Moreover, dry technology could very well be applied for generating a final fine product at sizes near or below 100 microns, as may be required for beneficiation by, for instance, flotation, magnetic separation or tank leaching.Dry HPGR grinding requires special attention in maintaining suitable process economics, when considering power input in grinding, drying and classification. In some cases, HPGR capacity and roll surface wear life may be negatively affected by a lack of moisture in the feed.This publication summarizes some of the features of, and experiences in dry HPGR applications. This includes design aspects of the classification system and discussion of the wear protection of the roll surfaces. The paper also includes examples of operational experiences of dry practices in minerals processing and cement plants."

Jan 1, 2012

By A. Welty, T. Garn, K. Lyon, B. Jakovljevic, R. S. Herbst, M. Greenhalgh, Cytec Solvay Group

"Industrial rare earth separation processes utilize PC88A, a phosphonic acid ligand, for solvent extraction separations. The separation factors of the individual rare earths, the equipment requirements, and chemical usage for these flowsheets are well characterized. Alternative ligands such as Cyanex® 572 and the associated flowsheets are being investigated at the pilot scale level to determine if significant enhancements to the current separation processes can be realized. These enhancements could be defined as higher separation factors, reduced stage requirements, or reduced chemical consumption. Any of these enhancements can significantly affect the costs associated with these challenging separation proccesses.A mid/heavy rare earth element (REE) separations flowsheet was developed and tested for each ligand in a 30 stage mixer-settler circuit to compare the separation performance of PC88A and Cyanex® 572. The ligand-metal complex strength of Cyanex® 572 provides efficient extraction of REE while significantly reducing the strip acid requirements. Reductions in chemical consumption have a significant impact on process economics for REE separations. Partitioning results summarized Table 1 indicate that Cyanex® 572 offers the same separation performance as PC88A while reducing acid consumption by 30% in the strip section for the mid/heavy REE separation."

Jan 1, 2016

By M. M. Papic, J. C. Whitehead

"A sample of Hat Creek coal has been extracted using supercritical aromatic solvents in a laboratory-scale extraction unit. Extract yields in the range 21 to 27 per cent of dry-ash-free coal were obtained.These yields are significantly lower than yields available from high-volatile bituminous coal and some lignites. Thus in a combined extraction/hydrocracking scheme for the production of liquid fuels from Hat Creek coal the char product would exceed that required to supply the energy and hydrogen requirements of the process. Excess char could be used for the production of power or gas for sale.IntroductionThe Supercritical Gas Extraction (SGE) process developed by the U.K. National Coal Board operates in two stages: an extraction stage in which a coal extract is separated from mineral matter and undissolved coal and a subsequent hydrogenation stage.The SGE process is based on the ability of a compressed supercritical fluid to dissolve relatively high molecular weight substrates. It is operated under conditions where a hydrogenrich portion of the coal is selectively extracted in a short residence time extraction stage leaving a hydrogen-deficient char. The process schematic shown in Figure I illustrates that the extract produced is separated from the solvent and passed to a conventional hydroprocessing stage while the char product is utilized in the production of heat, power and hydrogen for the process. An extract yield in the order of 50 per cent dry-ash- free coal represents a ""balanced"" case for such a process in which there is just sufficient char for the provision of these commodities."

Jan 1, 1985

By G. A. Highcock

"Operations started at BCL in December 1973J and the smelter is currently in the seventh year of its fifth campaign. The next major shutdown is scheduled for 1995. During the current campaign, a number of major on-line refurbishments have been carried out without any significant disruption to production. These include the complete rebuild of both drying plant electrostatic precipitators, the installation of a new electrostatic precipitator at the flash furnace, the conversion to a distributed control system throughout the smelter, and the installation of a converter air blowing control system.IntroductionBCL Limited operates a nickel-copper mine in northeastern Botswana approximately 100 km southwest of Francistown. Surface operations for the production of high-grade nickel-copper matte at a design capacity of 42 000 metric tonnes per annum, were commissioned in December 1973. Detailed descriptions of the mine and surface facilities have been presented previously(1-3).Over the years, a number of major engineering modifications and metallurgical projects have been carried out to overcome operating difficulties. improve metal recoveries, increase production rates and provide a better working environment.One of the major results of these projects was an increase in the 19805 in flash furnace feed capacity from 70 t/h to 120 t/h of new concentrate with a nominal feed rate of 105 t/h being achieved.(4)Because of the ore characteristics, i.e. a high mass fraction of ore reporting to concentrate, BCL operates one of the highest capacity spray drying plants and flash smelting furnaces in the world(5).A schematic of the BCL smelter is shown in Figure 1. The smelter is now in the seventh year of its fifth campaign, with the next shutdown scheduled for mid-l99S. In this campaign, the following major projects were completed:"

Jan 1, 1995

"Line Creek Resources Ltd. produces three million clean tonnes per year of metallurgical and thermal coals for the international market. The mining operation, which is located in the mountains of southeastern British Columbia, produces coal from four pits by conventional truck and shovel methods.The South Pit, which has been in operation since J982, has a benched highwall 490 m in height. Shallow dipping coal seams at the base of the syncline formation will be exposed in the highwall over the next four years of pit life. The first of these seams, which will measure 500 m in final highwall length, was exposed in J994. An auger, powered by a 1250 hp engine capable of cutting 2.2 m diameter holes, was brought on site in J994 and has proven to be a successful means of recovering coal from the J3 m thick seam.This paper covers the background to the selection of an auger mining method to recover highwall reserves together with the geotechnical and methane considerations for this approach.IntroductionLine Creek Resources Ltd., a wholly owned subsidiary of Manalta Coal Ltd., owns and operates the Line Creek mine. The operation which consists of four active pits, a processing plant, and rail loadout is located in the southeastern coal fields of British Columbia. Figure 1 shows the general area.The coal bearing sequence at the mine is preserved on the east and west limbs of a major syncline. Up to twelve mineable coal seams, ranging in thickness from 2 m to 15 m are contained in the formation. Within the pits the seams are stratigraphically consistent and structurally undisturbed, except for small-scale thrust faults that create multiple repeats of the seams."

Jan 1, 1995

By Gordon Sparks, Lyle Kajner

"An often over-looked component in the assessed value of a mining property is the value derived from the ability of the operator to limit financial losses during adverse economic times (i.e. low market price, high energy prices, etc.) by suspending operations. Overlooking the value of this type of operating flexibility when conducting mine investment analysis may negatively bias the risk profile for the investment by over estimating the investment's downside potential, thereby effectively undervaluing the investment. This paper illustrates the nature of the value of operating flexibility and discusses how it may be explicitly quantified within the context of conducting stochastic mine investment analysis. IntroductionMining properties are evaluated using an array of techniques ranging from simplistic non-discounted payback calculation s to sophisticated, discounted-stochastic simulation. Stochastic simulation analysis is perhaps the most robust mine investment analysis technique as it not only provides an estimate of the expected value of the property, but also quantifies the associated risks (for examples of stochastic mine investment analysis, see: Billingsley and Yaychuk, 1986; Gentry and O'Neil, 1984; Munro, 1977; or Harris, 1970).The quantification of risk is important as it provides the necessary yardstick required to allocate the corporation's resources efficiently. Resources are said to be allocated efficiently when the corporation's expected long-term financial reward is maximized while at the same time minimizing its risk (see Hertz, 1968; or Markowitz, 1952 for in depth discussions on efficiency as it relates to investment policy). The efficient allocation of resources should be the objective of any rational corporation. Therefore, rational corporations should employ stochastic evaluation techniques when screening their investments."

Jan 1, 1992