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By M Graham, R Brunning, C Andringa-Bate, S Westergren

In 2010, Rio Tinto Iron Ore’s operations commenced the planning and design of a sampling and analysis system for the new 50 Mt/a Cape Lambert Port B (CLB) facility. Current sampling systems at the ports consist of automated robotic, mass-based sampling protocols employed at Dampier, and semi-automated, time-based sampling systems operating at Cape Lambert Port A.The new sampling system at CLB has brought together a fully automated sampling and analysis system utilising time-based sampling, with the capacity to sample ore products of medium quality variation as defined in ISO 3082 (ISO, 2009). The CLB system is required to sample at shiploading rates from 6000 t/h to 13 440 t/h and provide full load-port analysis. The sampling approach is to proportionally extend primary increments (of varying mass relative to shiploading rate) to a standard length using variable speed aero-belt conveyor systems. This enables a fixed number of secondary cuts to be achieved for all primary increment masses and to be delivered to the automated cell. The cell is required to be capable of concurrently processing four individual shipments, each containing multiple cargoes.Achieving the target sampling precision for all export cargo sizes has culminated in the planning, design and construction of the largest automated iron ore port laboratory in the world. The CLB sampling and analysis cell was commissioned in Q3 and Q4 2013. This paper discusses the sampling philosophy and commissioning outcomes.CITATION:Brunning, R, Andringa-Bate, C, Graham, M and Westergren, S, 2014. Cape Lambert Port B shiploading, sampling and analysis, in Proceedings Sampling 2014 , pp 79–90 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 29, 2014

By S Russell

The completion of the $1.1 B Cape Lambert Upgrade project is the second ‘pillar’ in Rio Tinto Iron Ore’s expansion program that has enabled Rio Tinto Iron Ore to effectively double iron ore shipping capacity from the Pilbara between 2003 and 2009 to 220 million tonnes per annum (Mt/a), following the successful completion of the Dampier Port upgrade project two years earlier.The Cape Lambert Upgrade has built on and enhanced many of the engineering achievements of the Dampier Port upgrade project, as well as developing innovative and unique engineering solutions for this complex ‘brownfields’ project that presented its own challenges, particularly in this distinctive open-water port environment.The project was implemented in two phases to achieve an increase in port shipping capacity from 55 to 80 Mt/a – an enhancement phase and an expansion phase.The initial enhancement phase, which provided an increase to shipping capacity from 55 to 60 Mt/a, focused on increasing the utilisation and effi ciency of existing plant and equipment with a relatively small capital expenditure.The expansion phase, which provided the increase in shipping capacity to 80 Mt/a, included extending the existing iron ore wharf by 256 m to create four shipping berths, a new shiploader, an expanded stockyard (including a new fourth bucket wheel reclaimer) and a new surge bin facility to maximise outloading tonnage rates.The Cape Lambert Upgrade project was implemented whilst the port remained fully operational and continued to ship record tonnages of iron ore throughout the project duration. This achievement required signifi cant upfront planning and sequencing of construction activities to support the operation of the port. Innovative design and construction techniques were used to mitigate the impact and enable construction activities in and around the operating plant.Throughout the project, new benchmarks in engineering design and construction practices were established, which have since been adopted for new iron ore port facilities currently in planning phases.

Jul 11, 2011

By W. R. Purcell

An apparatus is described whereby capillary pressure curves for porous media may be determined by a technique that involves forcing mercury under pressure into the evacuated pores of solids. The data so obtained are compared with capillary pressure curves determined by the porous diaphragm method, and the advantages of the mercury injection method are stated. Based upon a simplified working hypothesis, an equation is derived to show the relationship of the permeability of a porous medium to its porosity and capillary pressure curve, and experimental data are presented to support its validity. A procedure is outlined whereby an estimate of the permeability of drill cuttings may be made with sufficient acuracy to meet most engineering requirements. INTRODUCTION The nature of capillary pressures and the role they play in reservoir behavior have been lucidly discussed by Lev-rett', Hassler, Brunner, and Deah12, and others. As a result of these publications the value of determining capillary pressure curves for cores has come to be generally recognized within the oil industry. While considerable attention has been directed toward the subject in an effort to provide a reliable method of estimating percentages of connate water, it has been recognized that capillary pressure data may prove of value in other equally important applications. This paper describes a method and procedure for determining capillary pressure curves for porous media wherein mercury is forced under pressure into the evacuated pores of the solids. The pressure-volume relationships ob- tained are reasonably similar to capillary pressure curves determined by the generally accepted porous diaphragm method. The advantages of the method lie in the rapidity with which the experimental data can be obtained and in the fact that small, irregularly shaped samples, e.g., drill cuttings, can be handled in the same manner as larger pieces of regular shape such as cores or permeability plugs. Based upon a simplified working hypothesis, a theoretical equation will be derived which relates the capillary pressure curve to the porosity and permeability of a porous solid, and experimental data will be presented to support its validity. This relationship aplied to capillary pressure data obtained for drill cuttings by the procedure described provides a means for predicting the permeability of drill cuttings. METHODS FOR DETERMINING CAPILLARY PRESSURES Several techniques have so far been employed in determining capillary pressure curves and these fall into two principal categories: (1) Liquid is removed from, or imbibed by, the core through the medium of a high displacement pressure porous diaphragm (2) Liquid is removed from the core which is subjected to high centrifugal forces in a centrifuge4,'. There are? however, certain limitations inherent in both methods. The greatest capillary pressure which can be observed by method (I), above, is determined by the maximum displacement pressure procurable in a permeable diaphragm which at the present time appears to be less than 100 psi. An even more serious limitation of the diaphragm method is imposed hy the fact that several days may be required to reach saturation equilibrium at a given pressure; hence, the time re- quired to obtain a well-defined curve may be measured in terms of weeks. Furthermore, to date, no suitable technique for handling relatively small, irregularly shaped pieces of rock, such as drill cuttings, has been reported and, therefore, measurements must be made, in general, on cores, or portions thereof. The centrifuge method offers the distinct advantage over the porous diaphragm method of arriving at saturation equilibrium in a relatively short time by virtue of the elimination of the transfer medium for the liquid. The calculation of capillary pressures from centrifuge speeds is somewhat tediousa, however, and the equipment required is fairly elaborate. While there exists the possibility that this method might be adaptable to the determination of the capillary pressures of cuttings, this particular ramification has not been investigated, as far as is known. In view of the limitations of the two principal methods for determining capillary pressures, the apparatus described in the following sections has been devised in order that difficulties previously encountered might be circumvented. MERCURY INJECTION METHOD FOR DETERMINING CAPILLARY PRESSURES Theory The methods described above for determining capillary pressures are characterized by the fact that one of the fluids present within the pore spaces of the solid is a liquid which "wets" the solid, i.e., the contact angle which the liquid forms against the solid is less than 90" as measured through that phase. For these "wetting" liquids the action of surface forces is such that the fluid spontaneously fills the voids within the solid. These forces likewise oppose the withdrawal of the fluid from the pores of the solid.

Jan 1, 1949

By W. R. Purcell

An apparatus is described whereby capillary pressure curves for porous media may be determined by a technique that involves forcing mercury under pressure into the evacuated pores of solids. The data so obtained are compared with capillary pressure curves determined by the porous diaphragm method, and the advantages of the mercury injection method are stated. Based upon a simplified working hypothesis, an equation is derived to show the relationship of the permeability of a porous medium to its porosity and capillary pressure curve, and experimental data are presented to support its validity. A procedure is outlined whereby an estimate of the permeability of drill cuttings may be made with sufficient acuracy to meet most engineering requirements. INTRODUCTION The nature of capillary pressures and the role they play in reservoir behavior have been lucidly discussed by Lev-rett', Hassler, Brunner, and Deah12, and others. As a result of these publications the value of determining capillary pressure curves for cores has come to be generally recognized within the oil industry. While considerable attention has been directed toward the subject in an effort to provide a reliable method of estimating percentages of connate water, it has been recognized that capillary pressure data may prove of value in other equally important applications. This paper describes a method and procedure for determining capillary pressure curves for porous media wherein mercury is forced under pressure into the evacuated pores of the solids. The pressure-volume relationships ob- tained are reasonably similar to capillary pressure curves determined by the generally accepted porous diaphragm method. The advantages of the method lie in the rapidity with which the experimental data can be obtained and in the fact that small, irregularly shaped samples, e.g., drill cuttings, can be handled in the same manner as larger pieces of regular shape such as cores or permeability plugs. Based upon a simplified working hypothesis, a theoretical equation will be derived which relates the capillary pressure curve to the porosity and permeability of a porous solid, and experimental data will be presented to support its validity. This relationship aplied to capillary pressure data obtained for drill cuttings by the procedure described provides a means for predicting the permeability of drill cuttings. METHODS FOR DETERMINING CAPILLARY PRESSURES Several techniques have so far been employed in determining capillary pressure curves and these fall into two principal categories: (1) Liquid is removed from, or imbibed by, the core through the medium of a high displacement pressure porous diaphragm (2) Liquid is removed from the core which is subjected to high centrifugal forces in a centrifuge4,'. There are? however, certain limitations inherent in both methods. The greatest capillary pressure which can be observed by method (I), above, is determined by the maximum displacement pressure procurable in a permeable diaphragm which at the present time appears to be less than 100 psi. An even more serious limitation of the diaphragm method is imposed hy the fact that several days may be required to reach saturation equilibrium at a given pressure; hence, the time re- quired to obtain a well-defined curve may be measured in terms of weeks. Furthermore, to date, no suitable technique for handling relatively small, irregularly shaped pieces of rock, such as drill cuttings, has been reported and, therefore, measurements must be made, in general, on cores, or portions thereof. The centrifuge method offers the distinct advantage over the porous diaphragm method of arriving at saturation equilibrium in a relatively short time by virtue of the elimination of the transfer medium for the liquid. The calculation of capillary pressures from centrifuge speeds is somewhat tediousa, however, and the equipment required is fairly elaborate. While there exists the possibility that this method might be adaptable to the determination of the capillary pressures of cuttings, this particular ramification has not been investigated, as far as is known. In view of the limitations of the two principal methods for determining capillary pressures, the apparatus described in the following sections has been devised in order that difficulties previously encountered might be circumvented. MERCURY INJECTION METHOD FOR DETERMINING CAPILLARY PRESSURES Theory The methods described above for determining capillary pressures are characterized by the fact that one of the fluids present within the pore spaces of the solid is a liquid which "wets" the solid, i.e., the contact angle which the liquid forms against the solid is less than 90" as measured through that phase. For these "wetting" liquids the action of surface forces is such that the fluid spontaneously fills the voids within the solid. These forces likewise oppose the withdrawal of the fluid from the pores of the solid.

Jan 1, 1949

By T. M. Geffen, J. L. Sanderlin, F. F. Craig, D. W. Moore

Scaled reservoir models have been used to study the effect of gravity on oil recovery performance in frontal-drive operations; namely, water, gas, or solvent flooding. The difference in density between the reservoir oil and the injected fluid causes their segregation, resulting in a non-uniform advance of the fluid front. In the laboratory flow tests, which simulated both five-spot and linear injection operations in flat reservoirs, the viscous, capillary, and gravity forces present in these operations were scaled. Dyed fluids were used so that the gross movement of the injected fluid could be observed. The studies covered a range of injection rates, formation thicknesses, and rock and fluid properties normally encountered in field operations. The results of the model tests indicate that the volume of the reservoir contacted by the injected fluid at its breakthrough into the producing well is less than that expected based on information which neglects gravity effects. This difference can often be as much as 80 per cent by gas or water injection in uniform sand bodies. Preliminary flow tests on a non-uniform sand body indicate that the uniformity of the flood fronts may in some situations be influenced to a much greater degree by permeability variations within the rock body than by gravity effects. The magnitude of fluid segregation due to gravity is controlled by the average injection rate, rather than day to day or week to week variations. INTRODUCTION One of the important factors controlling the oil recovery from a frontal-drive operation, such as water, gas, or solvent injection, is the volumetric sweep efficiency. This factor is a measure of the gross portion of the reservoir that is contacted by the displacing fluid. The volumetric sweep efficiency is influenced by gravity effects, well arrangements, and variations in rock permeability within the reservoir. The gravity effects are due to the displacing fluid being of different density than the reservoir oil. This causes the displacing fluid to move preferentially toward either the top or bottom of the formation. Non-uniform advance of the flood front can be caused by the relative positions of the injection and production wells. Variations in rock permeability also result in an uneven advance of the displacing fluid. Gas zones, representing paths of low resistance, may result in non-uniform movement of the injected fluid. The more uneven the advance of the displacing fluid, the lower is the volumetric sweep efficiency and thus the lower the oil recovery efficiency. The effects of well arrangement and permeability variations, upon the gross movement of the injected fluid have been the subjects of extensive investiga-ti0ns.1,2,3,4,5,6 Gravity effects have been recognized as being present in frontal-drive operations'.' but there has been little quantitative measure of their magnitude. Very likely the reason gravity effects have not been studied is that this problem does not lend itself to simple experimental or mathematical analysis. The development of reservoir modeling techniques has made possible a quantitative determination of the effect of gravity on fluid segregation and thus upon the oil recovery performance of frontal-drive operations. This paper presents a progress report on a laboratory investigation of gravity effects in fully liquid-saturated, horizontal, uniform as well as non-uniform systems. These results were obtained from scaled experiments on both linear and five-spot systems within the range of conditions normally encountered in secondary recovery operations. This study is concerned with the gross movement of the injected fluid to the time it first reaches the production wellbore. Therefore, it should be emphasized that the results of this paper can not be used to determine the effect of gravity segregation on oil recovery efficiency at abandonment conditions. MODEL SCALING The science of scaling models is relatively new as applied as petroleum production problems, Many of the scaling techniques have been adaptions of those used in basic studies of heat and fluid flow. There are

Jan 1, 1958

By G. H. Lair, B. J. Langford, S. H. Rockwood

Volumetric reservoir analysis is dependent upon a firm relationship between porosity, connate water, and net pay. Capillary presswe data on core samples interrelate these three factors. It is shown that other reservoir problems may be resolved: (I) whether water production is indigenous or extraneous to the oil producing interval, (2) an oil-water contact is being approached, and (3) whether the oil-water contact is remotely situated. INTRODUCTION Volumetric analysis of carbonate reservoirs challenges the ingenuity of the reservoir engineer due to an absence of data on the minimum oil-bearing and oil-producing pores of a given reservoir rock. Many studies with this as the ultimate objective are available on the physical characteristics and fluid-flow behaviors of the carbonate reservoir. Some of these publications are: Hassler, Brunner and Deahl's1 study of the role of capillarity in oil production; Jan Law's' and A. C. Bulnes3 statistical treatment of core analysis data; Chalkley's method4,5 or estimating specific surface areas and porosity; Walter Rose's9 report on porosity, reserves, and recovery; Archie's78 tex-tural classification of carbonate rocks; Stewart and Spurlock's9 large core analysis; Purcell'sl0 mercury injection method in studying capillary pressure phenomena; Stewart, Craig, and Morse's" model multiple-phase flow test in investigating the relative permeability effect; and Fatt's12 illumi-nating network model of porous me-dia. The present study shows that the static reservoir parameters of porosity, connate water, and net productive thickness may be interrelated by utilizing a statistical arrangement of mercury capillary pressure data in addition to routine core analysis. This report summarizes the techniques that are followed to obtain these relations which are applicable to carbonate and sandstone reservoirs that do not contain clays. Capillary pressure statistical studies may be extended to include clay-bearing rocks by utilizing water capillary pressure data. POROSITY It is necessary that the laboratory determine the porosity value that includes the pores that are filled with hydrocarbons and water in the reservoir. This is the reservoir's total porosity. When true total porosity values are not available, correlations between porosity and capillary pressure characteristics lose their significance since they cannot be related through oil-base mud core data to the porosity and connate water values found in reservoirs. Methods used to obtain reliable porosity data will not be discussed; however, care should be exercised in selecting samples for measurement. In homogeneously porous formations, small core plugs sampled frequently will furnish adequate information. Where heterogeneity, particularly vugginess, is present, large-core porosity data may be required; in such reservoirs a suite of capillary pressure samples may be selected from small plugs. CAPILLARY PRESSURE Capillary pressure data provide a method for relating two carbonate reservoir parameters, porosity and connate water saturation, which in turn permit delineation of productive rock types necessary for selecting the third parameter, productive thickness. Specific applications of capillary pressure data to petroleum reservoirs were suggested by Archie8 and Pur-cell."' Their work demonstrated that in preferentially water-wet rock, porc

Jan 1, 1958

By G. A. Croes, N. Schwarz

This paper reports the results of a series of model displacement experiments carried out for measuring the efficiency of the water-drive process. This series forms a continuation and extension of that described by Engel-herts and Klinkenberg. Detailed information has been obtained on the influence of the oil/water viscosity ratio. The results are represented in the form of a diagram from which both the oil recovery and the water/oil ratio can be easily read off as a function of the total production (oil plus water) for all values of the viscosity ratio M between I and 500. These resu1ts are viewed in the light of the two existing theories on water flooding, viz. that of Buckley and Leverett and that of Dietz. It is shown that if the Buckley-Leverett theory applies, the relation between the relative permeability ratio and saturation, which plays a major role in this theory, (.an be calculated with a high degree of accuracy from the results of the model experiments. Dietz's theory is found to be in agreement with the experimental results in a certain range of circumstances. A discussion of the physical background of the Buckley- Leverett and Dietz theories makes it clear why the latter fails to agree with some of the experimental results. INTRODUCTION For an economical exploitation of oil fields both a rational control of natural (primary) recovery processes and a proper application of artificial (secondary) recovery methods are essential. These require detailed information upon the dependence of the relevant flow processes on the variables by which they are governed. Three methods are available for obtaining this information: (1) (statistical) analysis of actual field data; (2) appropriately scaled model experiments; and (3) mathematical analysis of the physical problem. If sufficient data were available, the first method would, in principle, be the most reliable one, although it has the drawback that the basic relationships between the variables involved are to a large extent obscured by the natural inhomogeneities of most reservoirs. The most profitable procedure seems to be: (a) determining the fundamental relations for idealized reservoirs by methods (2) and (3); (b) checking the consistency of the results obtained by these two methods; and (c) establishing the range of applicability of these methods to actual reservoirs by comparison with the data accumulated under (1). In this paper items (a) and (b) are dealt with for the case of homogeneous loose sands initially saturated

Jan 1, 1956

By Frederick Tickell

PETROLEUM engineers are displaying considerable interest in those fundamental properties of matter and energy that control the phenomena of oil and gas production. The subject is a difficult one to investigate by laboratory experiments for two reasons: (1) it is impossible to reproduce in the laboratory the scale of forces and dimensions that exist in the underground reservoir; (2) if we attempt to scale down the dimensions we are unable to reduce all proportionally. It is as if we tried to construct a model blast furnace for the reduction of iron ore, and reduced all lineal dimensions. We should find that the interstices between the miniature chunks of ore would not .permit rapid transfer of gases, that combustion and heat transfer would not take place as in the full size furnace and that, in short, the contraption would not work. Just so, when we attempt to make a reduced scale oil field we find we must have, not only miniature reservoir and miniature wells, but "miniature" sand, oil, gas, etc. Much valuable work, however, has been done along these experimental lines and more will no doubt follow, but investigators should bear this point in mind and strive to attain dimensional homogeneity and dynamical similarity in order that their conclusions may be translated into terms applying to the oil reservoir. As Gibson says,1 "These conditions are attained when all terms of the physical equation have the same dimensions, . . . when all corresponding particles of the two systems trace out similar paths and when the velocities are such as to make all corresponding forces acting on two such particles in the same ratio. It is the purpose of this paper to discuss the mechanics of fluid movement as it pertains to the oil pool and to point out the complexity of the laws of fluid delivery under the conditions often found.

Jan 1, 1928

By Frederick G. Tickell

Petroleum engineers are displaying considerable interest in those fundamental properties of matter and energy that control the phenomena of oil and gas production. The subject is a difficult one to investigate by laboratory experiments for two reasons: (1) it is impossible to reproduce in the laboratory the scale of forces and dimensions that exist in the underground reservoir; (2) if we attempt to scale down the dimensions we are unable to reduce all proportionally. It is as if we tried to construct a model blast furnace for the reduction of iron ore, and reduced all lineal dimensions. We should find that the interstices between the miniature chunks of ore would not permit rapid transfer of gases, that combustion and heat transfer would not take place as in the full size furnace and that, in short, the contraption would not work. Just so, when we attempt to make a reduced scale oil field we find we must have, not only miniature reservoir and miniature wells, but "miniature" sand, 011, gas, etc. Much valuable work, however, has been done along these experimental lines and more will no doubt follow, but investigators should bear this point in mind and strive to attain dimensional homogeneity and dynamical similarity in order that their conclusions may be translated into terms applying to the oil reservoir. As Gibson says,' "These conditions are attained when all terms of the physical equation have the same dimensions, . . . when all corresponding particles of the two systems trace out similar paths and when the velocities are such as to make all corresponding forces acting on two such particles in the same ratio." It is the purpose of this paper to discuss the mechanics of fluid movement as it pertains to the oil pool and to point out the complexity of the laws of fluid delivery under the conditions often found. We have to do, fundamentally, with confined fluids, possessing potential energy whose expenditure is restricted by certain properties of the confining media and of the fluids themselves. The equation of motion and time is completely stated when we can assign values to the propulsive

Jan 1, 1929

By Leo Wolrnan

IN the relations that exist between capital and labor in this country, there is a bright as well as a dark side. After many years of distressing conditions of labor and a plentiful supply of propaganda, it is doubtful that the doctrine of the class struggle, however defined and stated, has been embraced by any influential and numerous elements of our population. Extreme and uncivilized methods of conflict, whether they be the labor spy as used by the employer or the sit-down strike by organized, labor, have come to be abandoned as the result of the pressure of sober and distinterested public opinion. Unwise terms of our law of trade unions and the unbridled zeal of its administrators show some slight signs of being revised in the light of 'experience and the protests of the law's own beneficiaries. At the point where labor policy touches economic conditions, the two powerful factions in the American labor movement appear to look with a less friendly eye on the bewildering succession of economic experiments and to have a deep nostalgia for a simpler and more prosperous economy.

Jan 1, 1938

Background information, formulae and a systematic set of procedures for estimating capital and operating costs for open pit mining equipment are presented in this paper. Firstly, equipment capital costs are required. These can be obtained from either suppliers, contractors or from first principles. The equipment is then divided into cost elements. Typically these are fuel and power requirements, spare parts consumption, wear items such as tyres, teeth and drill bits and finally repair and operating labour requirements. By consideration of the cost and life of each element a base cost can be derived. The base cost is then adjusted to suit specific site conditions such as the proximity to spare parts suppliers, the duty or ground conditions and the management and operator skills specific to the site. Hence, the same item of equipment can be costed to reflect different operations. Included are tables and data for typical plant items. Several examples are also given to illustrate the methodology being presented. The intention is to provide a set of procedures to allow costs to be built up from base level in a systematic and repeatable way. Applications for these costs include feasibility studies, budgetting and data for economic analyses.

Jan 1, 1990

The United States Bureau of Mines is establishing a computerized mineral inventory system to help the Federal Government appraise its mineral position and prepare programs insuring against critical shortages of materials. This system, called the Minerals Availability System (MAS), is a component of the Bureau's minerals intelligence function designed to conduct and maintain an inventory of minerals important to the Nation. The MAS defines the physical and commercial availability of the mineral resources. Known resources are evaluated and classified by deposit for entry into a computer storage and retrieval system. An integral concern of these evaluations is the cost of mining and beneficiating the ore contained in specific deposits. To meet this concern, a cost handbook was developed as an aid to preparing feasibility-type estimates for capital and operating costs of mining and primary beneficiation of various types of mineral occurrences. Cost data, obtained from U.S. and Canadian companies, were used as the basis of this handbook. The handbook presents cost curves and equations for each component of the mining and beneficiation process. Factors for each cost component are also given, thereby allowing the updating of cost for time, geographic location, labor rates, and mining and milling conditions. Included in the latter conditions are items such as the length of haul, need for rock bolts, and a rock work index for ores and rocks of various hardnesses. 1.2. USE OF THE HANDBOOK Using the handbook a feasibility-type estimate falling within 25% of expected actual cost is obtainable by summarizing cost components. This handbook should not be used to determine the cost of any single component of a mining or beneficiation system, as any single component may not fall within the 257 limit. It must be understood that anyone who uses the handbook must have a comprehensive knowledge of mining and processing technology and cost estimating procedures. The handbook was intended to be used internally by the Minerals Availability System. Because

Jan 1, 2012

By Dr. O’Neil Thomas J., Donald W. Gentry

The greatest of all gifts is the power to estimate things at their true worth. LaRockefoucauld INTRODUCTION The primary reason for performing a feasibility study on a proposed mining venture is to investigate all phases of the proposal in as much detail as necessary to justify either dropping the project or continuing expenditures through the next stage. The economic evaluation component of the feasibility study, therefore, must ultimately be based on information which provides an answer to the question, "What is it going to cost?" Unfortunately engineers preparing feasibility studies never have all the engineering or economic information they would like or need. Consequently, the economic portion of the analysis can only be performed if estimates of the various costs associated with the project are made. Project cost estimates, in turn, require estimates of all the physical factors affecting cost components, including anticipated performance of plant and equipment as well as all pertinent geologic, mineralogic, and metallurgical variables. Before useful cost estimating procedures can be applied considerable data must be collected, compiled, and organized. Preparatory work typically includes organization of cost data available for estimating purposes, development of techniques for updating historical costs, and establishing methods of forecasting prices and costs over the duration of the project. Cost estimates for mining and mineral processing projects involve so many features and variables that it is absolutely essential to have some means by which the vast amount of detail can be organized. It is very important to identify, in as much detail as possible, all the cost data available (historical and developed) to the estimator. These costs, after being properly identified in detail, should be com- piled, stored, updated regularly, and made readily available for use in developing new cost estimates Accessing files of current cost information requires a standardized numerical system of classifying cost data. When uniform definitions and procedures are used, every project record contributes to the common store of estimating data.

Jan 1, 1984

By Andrew L. Mular, K. K. Humphreys

Introduction Estimates performed on potential future plants must by their very nature be either order-of-magnitude or budget (preliminary) estimates. Of the three types of estimates recognized by the American National Standards Institute (ANSI Standard Z94.2), order-of-magnitude and budget estimates are the least accurate. Order-of-magnitude estimates have an expected accuracy of plus 50 percent to minus 30 percent. In other words, it is anticipated that actual project cost will be no more than 50 percent above the estimate and no less than 30 percent below the estimate. Budget estimates, or preliminary estimates as they are often called, have an expected accuracy of plus 30 percent to minus 15 percent. The reason that greater accuracy cannot be expected in performing estimates on proposed new facilities is simply that insufficient data is generally available to permit performance of a highly accurate estimate. As stated in ANSI Standard Z94.2, a definitive estimate, i.e., an estimate with an expected accuracy of plus 15 percent to minus 5 percent," . . is an estimate prepared from very defined engineering data . . . (including). . .as a minimum, fairly complete plot plans and elevations, piping and instrument diagrams, one line electrical diagrams, equipment data sheets and quotations, structural sketches, soil data and sketches of major foundations, building sketches and a complete set of specifications." In other words, the engineering of the project must be fairly well underway to permit a definitive estimate to be performed. Such is the case only after the construction decision has been made, all potential alternatives evaluated, and major expenditures committed for a particular course of action. This situation is beyond the scope of this chapter. The chapter is directed to comparison of various technological alternatives for which site specific engineering data is not generally available. Accordingly, such comparisons can be made only by utilizing preliminary or order-of-magnitude estimating techniques.

Jan 1, 1982

By G. A. Kordosky

Solution mining followed by solvent extraction-electrowinning (SX-EW) is one possible way to economically extract copper from ore bodies which cannot otherwise be profitably exploited. Published costs for the unit processes of SX and EW are out of date especially in view of the newer reagents now available and the newer circuit configurations, This paper updates the costs for SX-EW in 1985 dollars and also discusses some of the trade-offs which must be made when designing an SX-W plant.

Jan 1, 1986

By Daniel K. Dysinger

Capital resource budgeting is the way managers of publicly held companies fulfill their fiduciary responsibility to maximize the wealth of stockholders. Managers maximize shareholder wealth by allocating investment capital to the most productive of competing alternative projects. Managers do this in a manner that maximizes the net present value of the firm's future cash flow. The techniques of cash flow analysis are the primary tools available for selecting a corporate portfolio of projects that meets or exceeds the rate of return expected by shareholders. The reliability of cash flow analysis hinges on the ability of managers to forecast the future values of individual components of cash flow. The accuracy and reliabil¬ity of forecasting determine the soundness of capital investment decisions and, ultimately, determine the value of the firm.

Jan 1, 1997

By D. K. Dysinger

Capital resource budgeting is the means by which managers of publicly held companies fulfill their fiduciary responsibility to maximize the wealth of stockholders. Managers maximize shareholder wealth by allocating investment capital to the most productive of competing alternative projects in a manner that maximizes the net present value of the firm's future cash flow. The techniques of cash flow analysis are the primary tools available for selecting a corporate portfolio of projects that meets or exceeds the rate of return expected by shareholders. The reliability of cash flow analysis hinges on the ability of managers to forecast the future values of individual components. The accuracy and reliability of forecasting determine the soundness of capital investment decisions and, ultimately, determine the value of the firm. The present paper will explore tools for forecasting the spot market price of a commodity, silver, to demonstrate the difficulty and uncertainty involved in forecasting the future. The commodity price is only one of a number of components of the cash flow equation. Each component has a unique and uncertain future and must be individually analyzed and forecast to arrive at a robust cash flow model.

Jan 1, 1997

By R. J. Balfour, T. L. Papucciyan

"INTRODUCTIONCapital Cost considerations are basic to feasibility in the achievement of success for Mineral Processing Projects as much as or more than in many other industries. Capital cost is an important factor ae it 1R the unit of measurement for process engineering economic decisions. As a result of ever increasing complexity, alternatives of process and remoteness of site, there is an ever increasing emphasis on accurate estimating and the attendant cost control systems in the international market of today for the Mineral Industry where initial plant costs are becoming a more important factor than operating costs. An undervaluation means trouble ahead. An over-cautious assessment may bring an unnecessary abandonment of a project. Consequently, the ultimate cost must be predicted early and accurately and must be controlled to this parameter during the design and construction phases. Cost Est!~ mating is one of a variety of project management tools used to assist in planning and achieving the optimum balance between Quality, Cost and Time, the eternal triangle of evaluation, namely obtaining a project of acceptable quality at minimum cost and on time. In order to attain these established objectives, proper planning, organizing, coordinating, monitoring, adjusting and controlling the design, procurement and construction elements of the project are essential.This project management approach based upon the principle of a Task Force under single management, comprising a complete service organization, requires a substantial number of qualified individuals specialized in their own field and capable of working together as a team to perform their various functions effectively. The Task Force is supported by their chiefs of discipline and performs in accordance with established procedures and standards under the leadership of a Project Manager.General Engineering Company Limited with the backing of the full resources of Surveyer, Nenniger & Chenevert and its total staff of approximately 1,0009 offers the complete project management service to the Mineral Processing Industry of North America and the rest of the world. As mine sites become more remote and difficult of access, the need for an experienced team of specialists who work under the Task Force principle, with well established standards and procedures becomes even more important. Our long history of successful pro1ecta in this field has been our training ground for the fulfillment of this need."

Jan 1, 1972

By Frederick G. Coqueron, Joseph E. Pogue

FOR a number of years, the Department of Petroleum Economics of The Chase National Bank has been conducting a study of the capital employed in the petroleum industry. The technique followed is that of combining and summarizing the available financial and operating data for a group of thirty representative oil companies, doing about two thirds of the domestic business of the entire industry. This paper presents the results of the findings for the year 1943, and supplements the survey, "Sources, Disposition, and Characteristics of the Capital Employed by Thirty Oil Companies During the Nine-Year Period, 1934-1942," presented before the Petroleum Division of the American Institute of Mining and Metallurgical Engineers on Feb. 24, 1944, and also published as a pamphlet by The Chase National Bank.

Jan 1, 1944

By L Blackwell

Strategic mine scheduling is an industry best practice for increasing the long-term value of mining operations and supply chains. The application of optimisation technology such as mixed integer linear programming (MILP) is able to achieve a mathematically optimal result for a given scheduling model. Such a model will typically define the available source material, processing options and desired constraints for accessing and processing the material. Most strategic scheduling models, however, do not include a sufficiently detailed model of capital expenditure options related to capacity expansion.Typical strategic schedule models do not include important capital expenditure features such as capacity decay or expiration (limited lifespan of trucks), precedence relationships over time (rail construction before a new plant or non-linear expansions due to economies of scale) or mutually exclusive option sets (choices of plant size). By not including these features, a strategic mine scheduling model for a capital-sensitive operation is unable to be optimised to deliver maximum value or profitability.This paper presents several results of MILP optimisation using advanced capital expenditure modelling for mining operations and supply chains. Results of the study demonstrate that optimising capital expenditure at the same time as optimising the mining schedule allows for minimisation of capital purchasing, optimal timing for those purchases and optimal scheduling around them. Overall, this results in an increase in net present value.CITATION:Blackwell, L, 2014. Capital expenditure modelling for strategic mine scheduling, in Proceedings Orebody Modelling and Strategic Mine Planning Symposium 2014 , pp 315–322 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Nov 24, 2014