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By T Y. Dube

In this paper current net present value (NPV) based mine valuation techniques that take into account market and private risk are discussed and analysed. Potential pitfalls that arise from the application of a portfolio, market or commodity based risk metric to a mining project are identified. An alternative non-simulative framework for quantifying and factoring market and private risk in NPV calculations is proposed and then applied to a hypothetical case study in an attempt to overcome identified pitfalls. Mathematical proof that a static discounted cash flow (DCF) calculation can underestimate or overestimate mine NPV is presented, the conditions for each are outlined and the degree of underestimation defined.CITATION:Dube, T Y, 2012. How the use of market-based risk metrics can undervalue good mining projects and overvalue poor ones, in Proceedings Project Evaluation 2012 , pp 29-34 (The Australasian Institute of Mining and Metallurgy: Melbourne).

May 24, 2012

By D Jeffery, R Whittering, G Lane

Most aspects of process design are best addressed via bench scale or pilot plant scale test work. However, as experience is gained, fundamental or indicative data can provide more than adequate information to manage the risk associated with some process aspects of concentrator design.Historical precedence exists where minimal design test work has resulted in successful projects. On many occasions benchmarking, sometimes supported by fundamental data such as mineralogy, has been used to successfully develop effective process plant outcomes. Of course, this style of approach is most common with æfast trackÆ projects and often comes with the usual surprises that result from inadequate geometallurgy to define the project cash flow.This paper explores the risks and opportunities associated with the various facets of process development and design for a base metals concentrator. The paper is intended to provide guidance to project managers rather than address the technical aspects of process engineering.CITATION:Lane, G, Whittering, R and Jeffery, D, 2012. Benchmarking versus test work - How should you manage process risk?, in Proceedings Project Evaluation 2012 , pp 49-52 (The Australasian Institute of Mining and Metallurgy: Melbourne).

May 24, 2012

By B Olsson, B Reynolds, R Norman

An unprecedented growth in demand for coal exports has placed pressure on multi-user coal chains to guarantee that their capacity expansion projects will meet the required demand. These projects, however, are taking place in an increasingly complex commercial and technical environment - competing rail and coal terminal service providers as well as a myriad of competing mine operators, all needing to operate in an increasingly integrated manner to get the most out of expensive shared assets.Increasing system complexity and integration has driven the need for more holistic and sophisticated analysis tools. The capacity of coal chain subsystems, such as mine, rail and port, can no longer be determined effectively in isolation. Understanding the nature of the interactions between these subsystems, their sensitivity to uncertainty and the resultant capacity of the integrated system is the key to both maximising value and minimising risk.Recently, TSG has worked closely together with the Integrated Logistics Company and a number of key stakeholders in the Dalrymple Bay Coal Chain to develop independent system master plans. These master plans have provided a quantitative and rational assessment of coal chain capacity in its current state and a prediction of its capacity once a pipeline of committed capacity improvements is in place. This paper provides an overview of the study and a comprehensive guide to the process required to effectively achieve valuable strategic insights in a challenging multi-user stakeholder environment.CITATION:Reynolds, B, Olsson, B and Norman, R, 2012. Using independent system simulation to mitigate risk in the Dalrymple Bay Coal Chain, in Proceedings Project Evaluation 2012 , pp 77-84 (The Australasian Institute of Mining and Metallurgy: Melbourne).

May 24, 2012

By S Coward, J Vann, R Wolff, S Jackson, S Moayer, A Bye

Uncertainty about the future and orebody should significantly impact evaluation of mining projects. Scenario planning, widely used in other industries, for example in the petroleum industry, can provide organisations with an opportunity to explore the consequences of uncertainty on their future plans. By developing plausible scenarios, scenario planning assists decision makers by allowing them to make systematic and possibly effective decisions for the future. This paper reviews existing mine project evaluation in the context of a new framework called scenario-based project evaluation (SBPE) (Vann et al , 2012) that addresses many shortcomings of existing approaches. SBPE uses conditional simulations (CS) models as inputs which are evaluated against future alternative project pathways (æalternativesÆ). These alternatives are evaluated using multiple plausible images of the deposit (CS realisations) which capture realistic variability and as an ensemble, map uncertainty of various orebody attributes at fine scale. The alternatives can involve different mining, stockpiling, blending and processing strategies. The ultimate output is a (stochastic) set of cash flows for each alternative from which financial measures, such as NPV, can be derived. Alternatives can then be explored in the presence of against external scenarios such as changes in prices, costs, and taxation. The obvious problem with such data rich results is knowing which scenarios or group of scenarios are optimal.An innovative approach to robust stochastic optimisation (RSO) suited to the SBPE framework is presented here for the first time. This approach to RSO aims to deal with the large number of alternatives generated from SPBE. The goal of applying the RSO approach to SBPE is to identify robust strategic alternatives (project configurations) which have the flexibility to deal with variability and uncertainty of geological and processing inputs such as density, grade and process performance. By applying the proposed RSO method, it is possible to deal with uncertainty and identify the best project configuration in the face of a large number of envisaged scenarios. A case study is provided, in which we have tested the application of the proposed method and compared the result with conventional methods. An important conclusion from this research is that selecting the value of the penalty coefficients in the RSO approach proposed is (as is all optimisation) an exercise of trade-offs; a higher net present value (NPV) is generally associated with a higher risk and a lower risk is associated with a lower NPV. Indeed, this is a strong argument for considering the RSO approach outlined here over more conventional approaches.CITATION:Moayer, S, Vann, J, Coward, S, Jackson, S, Bye, A and Wolff, R, 2012. An innovative approach to robust optimisation for scenario-based mineral project evaluation, in Proceedings Project Evaluation 2012 , pp 141-148 (The Australasian Institute of Mining and Metallurgy: Melbourne).

May 24, 2012

By G Nicholas, S Coward, J Vann, R Wolff, S Jackson, S Moayer, A Bye

"A new approach to mineral project evaluation is described called Scenario-Based Project Evaluation (SBPE). SBPE incorporates well established æscenario planningÆ and æscenario thinkingÆ approaches, which are used extensively in other industries,?most notably the?petroleum industry. While most scenario planning is qualitative and non-probabilistic, the approach described here includes both quantitative and qualitative aspects. SBPE is complementary to optimisation approaches and allows mining firms to build and operate projects that are more robust in the face of adverse changes as well as proactively respond and exploit the upside offered by a realistic assessment of variability. The approach has potential to improve project performance and decrease operational risk. It also has important applications for currently operating mines.Conventional evaluation of metalliferous mineral deposits uses estimates of metal grades and deleterious attributes in singular æorebody modelsÆ, usually 3D block models, which fail to capture two critical aspects that underpin the realised value of mining projects: the inherent uncertainty of the estimated attributes the spatial variability of attributes, at the scale of mining selection, which impact on downstream processing steps and fundamentally drive realised value. While singular models are appropriate for estimating block averages, conditional simulation (CS) models of the relevant attributes are needed to represent uncertainty and capture spatial variability. Any attributes that can be either built into CS models and/or modelled in the envisaged mining/processing steps, can be evaluated fully through to highly ægranularÆ (ie detailed and un-smoothed) cash flows. A complete view of SBPE relies on selected strategies being tested against plausible æscenariosÆ of factors external to the project and thus outside management control. æExternalitiesÆ captured in such scenarios include market prices, costs and taxes. Via SBPE, project managers may demonstrate that there is material value in preserving or purchasing options that provide future flexibility to respond to the changing externalities or changes in orebody performance. Such flexibility generally comes at a cost but is very difficult to value. It is argued that full value chain evaluation using SBPE can help to value these options for a mining company. A case study for a gold mine is presented.CITATION:Vann, J, Jackson, S, Bye, A, Coward, S, Moayer, S, Nicholas, G and Wolff, R, 2012. Scenario thinking - A powerful tool for strategic planning and evaluation of mining projects and operations, in Proceedings Project Evaluation 2012, pp 5-14 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

May 24, 2012

By K. A. Natarajan

The utility of yeast, Saccharomyces cerevisiae, in the separation of quartz from hematite is demonstrated. Yeast cells, as well as their metabolites, functioned as flotation collectors, depressants or flocculants and dispersants for hematite and quartz. Interaction between yeast and the above minerals resulted in significant surface chemical changes, rendering quartz surfaces hydrophobic and hematite hydrophilic. Mineral-specific extracellular proteins and exopolysaccharides were secreted by yeast cells when grown in the presence of quartz and hematite, respectively. Quartz could be efficiently separated from hematite through microbially induced flotation and selective flocculation.

May 1, 2012

By M. E. Mellado

In this paper, we present an a posteriori validation of a heap leaching analytical model using sensitivity analysis. The model is suitable to represent the process of heap leaching of solid reactants from porous pellets and is based on a combination of the leaching kinetics at two levels: particle and heap. The validation is simple, and a sensitivity analysis can easily be performed. The simplicity of the analysis provides insight into the control and optimization of the heap leaching process without strong mathematical complexities. The model and the corresponding sensitivity analysis include the effects of heap height, particle sizes, flow rates and several operation-design variables. Using a case study, we discuss the importance of model validation based on sensitivity analysis. We also comment on several choices for optimizing the process. We had three goals in this work: a posteriori validation, highlighting the importance of model validation and providing insight into optimization choices. We can conclude that the model has good internal logic and there are no extra variables; i.e., all of the variables in the model are necessary.

May 1, 2012

By Jian Liu

The dissolubility of a natural sphalerite (ZnS) in the entire pH range was theoretically calculated, and its practical dissolution in an aqueous solution at different pH values in an inert environment, together with its surface properties after dissolution, was fully investigated. The results of the investigation indicate that the total concentration of Zn (CZnT) decreases significantly with the increase of pH value, while the pH value is set below 8; however, it reverses when the pH value reaches 8. Such a tendency is similar to that of the theoretical calculations, although the experimental CZnT were much higher than those of the theoretical calculations. The X-ray photoelectron spectroscopy (XPS) of the sphalerite surface after its dissolution under alkaline solution shows that a polysulfide (Sn 2-) surface layer with a binding energy (BE) value of 162.96-163.25 eV is present on the surface, and the percentage of Sn 2- increases significantly with an increase in pH value; the undissolved and dissolved sphalerites under the acidic solution have a negligible difference in S2p peaks. The surface S/Zn ratio of all dissolved sphalerites shows a marked Zn enrichment and S deficiency. An atomic force microscope (AFM) view of the sphalerite surface, after its dissolution under the alkaline solution at a pH of 12, shows that the surface is significantly different in morphology from that of the undissolved one.

May 1, 2012

By Hussin A. M. Ahmed

Oxidized coals are difficult to float. Therefore, in this paper, a special flotation procedure was investigated for upgrading this type of coal. The procedure is called direct contact flotation. It relies on mixing dry coal either with pure (anhydrous) flotation reagent(s) or microemulsion. By applying the new direct contact flotation procedure, a coal yield reaching > 95% using anhydrous flotation reagents was achieved, but with relatively high consumption of reagents (up to 30 g/kg). This high reagent consumption may be attributed to the fines included in the flotation feed (100% less than 0.5 mm, with 40% less than 75 µm). On the other hand, the clean coal yield was found to be approximately 88% when mixing dry oxidized coal with microemulsion droplets from dodecane and dodecyl tetra (ethylene glycol) ether (C12E4) in water at a total reagent dosage of 10 g/kg. The direct contact of coal either with unhydrous reagents or microemulsion also provided a high flotation selectivity.

May 1, 2012

The roasting process of copper concentrates containing variable quantities of arsenic in a fluidized bed regime was analyzed, considering the technical literature published on the topic in the last quarter century. Although emphasis has been given to the analysis in the fluidized bed regime, other processes have also been considered, under a reducing, neutral or oxidizing atmosphere. The kinetic mechanisms of roasting, as well as the models that have been applied or those likely to be used to explain the kinetics of arsenic removal, are analyzed. Regarding the kinetic mechanisms, those that have been applied to copper concentrates with both high and low arsenic content are included. The roasting kinetic model includes the kinetic data analysis techniques, general models, equations and an estimation of the conversion degree through dynamic, differential and integral methods, as well as particular models for mineralogical components, such as smelter dust and copper concentrates with low and high arsenic content.

May 1, 2012

By Jennifer J. Swenson

El presente texto describe los problemas de deforestación, precios e importaciones de mercurio en la minera artesanal aurífera de Madre de Dios. En ese sentido, a medida que la interconexión de la economia mundial avanza, es más difícil que países en desarrollo aprovechen las fuerzas lucrativas de la demanda global para lograr una sostenibilidad social y ambiental. En consecuencia, los países en desarrollo contienen un peso ambiental desigual en relación con los países desarrollados qie importan materias primas. Como ejemplo de ello, el precio del oro aumentó, así como la minería aurífera informal y no industrial en los países en los países en desarrollo y el mal manejo del mercurio en el uso del oro, repercutió en el medio ambiente y los mismos mineros, al igual que el problema de la deforestación. Por ello, se plantea un programa para enfrentar dchos problemas en la región de Madre de Dios y reducir el aumento de la minería informal.

May 1, 2012

By Dave J. Porter

Si bien, los proyectos son el camino para que una organización minera cumpla con su estrategia, la gran mayoría de su historial de cumplimientos son un fracaso puesto que el impacto del proyecto no es tan rico en sus etapas y las organizaciones mineras no pueden cumplir con su visión y estrategía. En ese sentido, el presente texto señala la importancia de una adecuada gestión de proyectos para que la organización minera cumpla con su estrategia. Así, la madurez de la gestión de proyectos es un indicador de éxito continuo y requiere de visión, compromiso en las etapas iniciales, ya que sus ganancias son difíciles de cuantificar.

Apr 1, 2012

By I M. Platten, S C. Dominy

The Clogau St DavidÆs gold mine has a recorded production of around 81 000 oz Au and it is the largest mine in the Dolgellau gold-belt and BritainÆs most prolific historical producer. The original mine was first worked for copper, however; in 1854, gold was found in waste material from the St DavidÆs section. In recent times the mine has operated intermittently between 1983 - 2007. The principal black shale-hosted gold-bearing reef (Main Reef) can be traced for about 3 km, striking approximately NE-SW and dipping steeply between 60¦ - 90¦ SE. The reef system pinches and swells, changes strike and splits into a number of smaller branches. Reef width is variable, ranging from over 6 m to a few cm and in places reducing to small irregular blobs. The reef is internally complex and composed of swarms of narrow (1 - 300 mm) subparallel veins separated by country rock sheets. The gold-bearing veins within the reef package are discontinuous; though generally possess bonanza grades running 10s - 100s oz/t Au. It has historically been shown that some gold-rich vein segments can grade up to 300 oz/t Au. The predictability of the gold-rich segments is poor, but has been shown to be related to presence of the Clogau (black shale) Formation, and/or the mechanical interactions of the reef with greenstone sills, reef branching and splitting and/or cross-fractures to form ore shoots. The mine is currently being re-evaluated as a potential small-scale selective operation.CITATION:Dominy, S C and Platten, I M, 2012. Geology, mineralisation and potential of the Clogau St DavidÆs mine, Dolgellau gold-belt, Gwynedd, Wales, in Proceedings Narrow Vein Mining 2012 , pp 101-120 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Mar 26, 2012

By G Morgan, C Kemp

In December 2010, a trial of borehole radar technology was conducted to test the usefulness of the technique in better refining the position and geometry of narrow vein orebodies away from the primary data sources of drilling and mapping of development excavations. This paper summarises the reasons why the technique was applied, describes the testing methods selected and summarises the outcomes of the trial.Poor reconciliations of recovered metal from a section of an orebody at Jundee mine site, Western Australia, led to an investigation that identified insufficient understanding of the geometry of a narrow vein orebody as a potential cause. This orebody was situated between mapped development excavations and away from surrounding drill holes. Borehole radar was identified as a possible technique that could supply information on vein location and continuity away from other data sources allowing more accurate orebody modelling and subsequent stope optimisation.A borehole radar instrument (10 - 100 MHz frequency) was inserted into pairs of purpose-drilled boreholes on either side of relatively well-constrained mineralisation and the radar reflection data was collected. This process was repeated in five locations across the mine to represent the most common geological settings, lithologies and orebody varieties encountered at Jundee to determine the suitability of applying the technique in each of these settings. Collected, processed and interpreted radar data was compared to other geology data collected independently for verification and interpretation.Conclusions drawn from the analysis were that the technique could effectively determine the following features of the mineralised veins in the majority of test environments: geometry of veins, magnitude of offsets where structures intersect and orientations of planar structures with short strike length. The technique was very useful in selecting the appropriate structural interpretation where available data could lead to multiple, equally likely, interpretations.CITATION:Kemp, C and Morgan, G, 2012. Using borehole radar to refine orebody interpretations in a narrow vein gold deposit, in Proceedings Narrow Vein Mining 2012 , pp 121-130 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Mar 26, 2012

By S Hall

Mining schools around the world, many unfortunately now closed, were often established to teach the techniques of narrow vein mining and associated processing to students studying part-time while working in the industry. This arrangement ensured graduates (or æassociatesÆ) had a mix of skills and knowledge invaluable to the industry.It is argued that there is still a need to educate students in these narrow vein techniques and that there will be a growing demand for such graduates with a high level appreciation of this type of mining. There is also a need for innovation in narrow vein mining and processing to develop specific technologies and allow the use of techniques applied in æbulk miningÆ to achieve improvements in productivity, safety and economic performance.This paper aims to review the situation with regard to education and innovation in narrow vein mining.CITATION:Hall, S, 2012. Narrow vein education - back to the future?, in Proceedings Narrow Vein Mining 2012 , pp 23-26 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Mar 26, 2012

By B Besa, E K. Chanda

It has long been recognised that narrow vein mining needs innovative approaches to mine access and mining methods in order to improve the economics of this vital part of the mining industry. The mining equipment used currently requires large openings in narrow vein-type deposits making mining operations uneconomical. In view of this and other shortcomings of the current mining practices, a study was initiated to investigate the potential of using low profile electric loader with mounted conveyor in conjunction with the electric monorail haulage system (EMTS) to load and haul the blasted material, particularly in decline development and main haulages. Computer simulation based on the General Purpose Simulation System/Henrikson (GPSS/H) is used to model the system and evaluate its performance. The results are compared with those for conventional mining using trucks and loaders. The EMTS provides competitive haulage rates in substantially smaller excavations than is currently achievable. According to simulation results, the electric loader in conjunction with the EMTS had the same number of blasts as the conventional system and hence the same advance rate of 3.33 m per 12 hour shift. Furthermore, the total drill-blast-load-haul cycle time was less than the conventional system by one hour.CITATION:Besa, B and Chanda, E K, 2012. Evaluation of low profile electric loader in conjunction with electric monorail haulage system in narrow vein mining, in Proceedings Narrow Vein Mining 2012 , pp 221-228 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Mar 26, 2012

By J Hadjigeorgiou

Narrow vein mining, as most types of mining, faces important geotechnical challenges. The specificity of geotechnical challenges in narrow vein mines stems from the nature of the deposits, which are often inclined, discordant and found within fractured rock or faults or in shear zones within country rock. This complicates the construction of representative geomechanical models and limits the applicability of several engineering design tools. Furthermore, in certain cases, the severity of encountered geotechnical problems is considerably greater in narrow vein than in wider orebodies. This paper provides an overview of geotechnical and other challenges in narrow vein mines with a focus on how these are currently addressed. Of particular concern is the use of manual labour working close to the mining face where there is greater exposure to geomechanical hazards. This review concludes with a particular emphasis on understanding the limitations of commonly used engineering tools and techniques to address geotechnical problems in narrow vein mines.CITATION:Hadjigeorgiou, J, 2012. Geotechnical challenges in narrow vein mining, in Proceedings Narrow Vein Mining 2012 , pp 15-22 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Mar 26, 2012

By K Rees

In the ideal world of an underground mining engineer, all narrow vein orebodies would be perfectly straight and continuous, thus would be a dream to mine. However, this is usually not the case. Narrow vein orebodies generally occur in association with shear zones and while shear zones do form linear trends, they most commonly preserve undulating expressions that need to be closely monitored, particularly when overprinted by post-formed structures. The surge in mines using fibrecrete as a primary form of ground support effectively reduces the time available for geological interpretation down to a 30 minute window between bogging and shotcreting. Thus, if the quality of the data collected is not up to scratch, then there is only a limited ability to reassess using 2D face photographs. To negate this, Xstrata Nickel AustralasiaÆs Cosmos mine has upgraded its data collection procedure. Geological information is now collected using photogrammetry survey, producing 3D images of the drive. Once created, the digital image of the drive is loaded into Vulcan, thus enabling geological interpretation to be carried out along entire drives, between levels and in association with all other data (eg drill holes, seismic data, etc). In addition to this, the 3D image can be used to accurately model the location of the ore, enabling stoping panels to be confidently positioned to maximise grade and minimise dilution. However, with the focus at Cosmos changing from narrow vein mining, to bulk mining methods in a more geotechnically complex terrain, the use of the 3D images has become paramount in understanding the structural geometry. Continual interpretation of the data has enabled drive profiles to be maintained through the increased use of ground support in poor ground and the redesign of development to enable optimal intersection of structures. Nevertheless, while the collection of quality data is important, it is only the effective use of the data, which enables significant gains in understanding.CITATION:Rees, K, 2012. The benefits of using photogrammetry in the geological interpretation of the Cosmos nickel mine, in Proceedings Narrow Vein Mining 2012 , pp 145-148 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Mar 26, 2012

By A Richmond

"In some lode-style gold deposits the geological (lithological) uncertainty may have similar economic significance as the grade uncertainty. In the absence of precise knowledge of the deposit geology, geological models of these types of deposits that are used to constrain spatially the estimated (or simulated) grade values may influence significantly the contained metal. Methods for assessing geological uncertainty quantitatively are rarely considered due to their perceived inability to consider exhaustive geological interpretations, and resulting models that often appear geologically unrealistic. Furthermore, should the lodes have been subjected to folding, or where the mineralisation continuity does not follow a planar orientation along strike or down dip, standard methods of variography and interpolation using linear vectors in space often do not provide a good representation of continuity. An alternative approach is to relate spatial samples from adjacent drill holes using an unfolding plane.The paper demonstrates conditional simulation of the geometry and gold grades of a folded lode-style deposit where:simulation of lode geometry considers explicitly the geologistÆs interpretation, andsimulation of gold grade values that consider explicitly the folded nature of the lodes.The results are contrasted to the traditional approach of linear vectors in real space for a single lode interpretation.CITATION:Richmond, A, 2012. Conditional simulation of a folded lode-style gold deposit, in Proceedings Narrow Vein Mining 2012 , pp 149-154 (The Australasian Institute of Mining and Metallurgy: Melbourne)."

Mar 26, 2012

By J. T. Carlson

Dolomite [CaMg(CO3)2] is an intolerable impurity in phosphate ores, due to its MgO content. The need to develop a cost-effective method for the removal of dolomite from high-MgO phosphate ores becomes increasingly important as high-grade reserves become depleted. The jigging process has been investigated as a method for the beneficiation of phosphate ores. A laboratory-scale jig was constructed and tested using a semicontinuous, ?through-the-screen? jigging process. Two types of sedimentary phosphate ore were used; a sample from Plant 1 in the 4.00 x 0.85-mm size range, containing 1.55% MgO, and a sample from Plant 2 in the 3.40 x 0.85-mm size range, containing 3.07% MgO. These were tested, using previously optimized jigging parameters, at high and low feed rates. For the Plant 1 phosphate ore, a phosphate concentrate that contained 0.89% MgO was achieved with a bone phosphate of lime (BPL) recovery of 32.0%. For the Plant 2 phosphate ore, a phosphate concentrate that contained 1.38% MgO was achieved, with a BPL recovery of 74.7%. Minimum achievable MgO grades were also determined by analyzing hand-separated phosphate samples.

Feb 1, 2012