Production Capacity Optimisation in the Presence of Grade Uncertainty

Grade uncertainty can have a number of important implications for a mining operation. One of the most significant risks in not considering grade uncertainty in planning is the over or under allocation of processing or mining capacity when compared to realised grades. This could lead to wasted capital expenditure or missed opportunities to add value. This paper demonstrates a method that optimises production capacity and mining schedules in the presence of grade uncertainty. Applying this method to the case study of a nickel deposit recommended a reduction in processing capacity, an increase in mining capacity and more extensive utilisation of stockpiles than optimisations completed with traditional methods. As a result, average NPV improvements of between seven per cent and 27 per cent were gained.