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By Karl J. C. Harries

"6.1. INTRODUCTIONThis chapter comments on some of the more common types of agreements related to property examination and acquisition, other than the farm-in/joint venture agreement or common undertaking, which is dealt with in the next two chapters. Many of the comments made in Part IV of Chapter 4 apply equally to any such agreement. In addition, many of the comments in Chapter 8 and the examples in Volume II are most certainly relevant to many other types of agreement.6.2. RIGHTS OF FIRST REFUSAL1A right of first refusal is a right that obligates an owner to offer his property, or an interest therein, to the holder of the first right if the owner intends to sell or otherwise dispose of it. It may be triggered either by the owner wishing to offer his property for sale or by receipt of a bona fide offer to purchase his interest from an “outside” third party. The mechanics and procedures to implement a first right should be set out clearly in the agreement, and their basics are the same, whether the first right is a stand-alone document or is part of an acquisition agreement.2Rights of first refusal are common in agreements to permit some control over the disposition of an interest and there they can be a valuable provision. However, some explorationists feel that they are also a good stand-alone agreement to have while a property is being evaluated to decide whether or not it is worth optioning. The reasoning is that such an arrangement will tie up the property to allow a quick look and, if the property looks interesting, the balance of the term of the first right will give an ample exclusive period of time to negotiate with the owner and settle an acquisition agreement. In addition, the explorationist is protected by the first right if the owner decides to negotiate a deal with another party."

Jan 1, 2003

"The Code was developed in 2004 through the Collaboration Agreement between Institution of Mining Engineers of Chile (IIMCh) and the Ministry of Mining (Chile) in Dec 2002. It is an amalgamation of current practices with respect to standards and procedures for exploration prospects, mineral resources, and reserves for the purpose of public reporting. Certification is required to prepare and issue information on mineral assets according to the guidelines that regulate the technical, economic, and environmental aspects that satisfy the conditions set by the Chilean capital and financial markets.The Mineral Resources Committee of the Instititution of Mining Engineers of Chile (IIMCh) is pleased to introduce theCode for the Certification of Exploration Prospects, Mineral Resources and Reserves which is the result of a Collaboration Agreement between the IIMCh and the Ministry of Mining established in December, 2002.This code synthetizes the present practice of the mining industry in regard to standards and procedures applied to exploration prospects, mineral resources, and reserves with the purpose of reporting publicly on financial instruments based on these mine assets in the capital markets. These standards follow general criteria already adopted and applied by capital markets in those countries characterized by a very dynamic and well developed mining sector such as Australia, Canada, Southafrica, United Kingdom, and others. The work done by the Mineral Resources Committee of the IIMCh has had the recognition of the Combined Reserves International Reporting Standards Committee (CRIRSCO) that leads the establishement of an international code in these matters. CRIRISCO is an entity formed by representatives of the countries previously mentioned, a representative of the Society of Mining Engineers of the UStates and a representative of the IIMCh. The Institution thanks the Ministry of Mining, the representatives of these Ministry in the Mineral Resources Committee, and specially the Minister of Mining, Sr. Alfonso Dulanto Rencoret due to the genuine support given to the IIMCh in the preparation of this Code.The Institution also thanks the Superintendencia de Valores y Seguros (SVS) because of the help given continuously to the Committee as well as by the interchange of opinions and suggestions received during the preparation of this document."

Jan 1, 2003

By A. Mukhopadhyay

Gas stirring, simultaneous arcing, chemical additions are some basic steps in the secondary steel making. From tap to team however, there are enough uncertainties and several in-situ decision making required to match the fmal composition and temperature in the given amount of processing time. Currently available control algorithms rely on overall material and heat balance coupled with a self-learning regression based tuning of model constants. In this paper we demonstrate the capabilities of Computational Fluid Dynamics (CFD) in modeling and analyzing the thermo-chemical aspects of secondary Steelmaking. These models take advantage of scientific and engineering advances in computational tools and provide almost real time speed of analysis. This can be a very effective tool for operator training, process debugging and improvement as well as new innovations. Keywords: Argon purging, Secondary steelmaking, Arcing, Ladle Furnace, Process Control.

Jan 1, 2003

By Michael J. Lawrence

"The VALMIN Code was developed and formally adopted by The Australasian Institute of Mining and Metallurgy (AusIMM) in 1995 and a revision was issued in 1998. The VALMIN Code applies to all relevant reports under the Australian Corporations Law, including submissions to the Australian Stock Exchange (ASX) and the Australian Securities and Investments Commission (ASIC).The VALMIN Code and Guidelines sets standards for the preparation and commissioning of independent assessment and/or valuation reports on mineral and petroleum assets or mineral and petroleum securities.It is mandatory for AusllvI:M's members to follow this Code in these relevant circumstances and failure to do so will result in serious sanction of the member by the Ausllvllvfs Ethics Committee. Public support for the use of this Code has been given by regulators (ASX/ASIC) and market participants ( eg major accountancy firms). It is also endorsed as a guide to general best practice in project assessment and valuation.This paper will discuss how the VALMIN Code has worked in practice over the past few years. It will also examine areas where the Code could be improved and how it could form the basis of a new Canadian Code for mineral property valuation."

Jan 1, 2003

By E de Necker, F D. I Hodg, L-M Cruywagen

The acid mine drainage (AMD) situation at three opencast collieries in the Witbank Coalfield, South Africa, was evaluated from different perspectives. Twenty-seven test pits were dug into the spoils of these collieries to characterise the in situ conditions of spoils of varying age. Detailed static testing was done on surrounding drill holes and additional samples were taken from the test pits. Selected samples were tested using different techniques, namely ABA, mineralogy and kinetic tests. Groundwater monitoring boreholes from the areas surrounding these spoils were also used for characterisation. The ABA results compared favourably with the in situ determinations; acidic test pits proved to be potentially acid-generating from ABA, even when the samples had neutral paste pH. Kinetic test results showed these samples to yield low pH leachate over the test period. In several of these results, the theoretical depletion of neutralising potential and the onset of acidity were well matched. NAG pH-values and final observed water chemistry corresponded for the cells predicted by ABA to acidify, but compared poorly in cells that did not acidify. Results from the non-acidic spoils were consistent with the in situ observations. Alternative kinetic test methodologies were also employed. Duplicate samples were tested in humidity cells and in aerated trays that were manually wetted on a regular basis. Results from these tests showed an excellent correlation. Detailed mineralogical determinations using XRD and XRF were used for comparison to the ABA and, in some cases, humidity cell results. These comparisons show that the ABA results are consistent with the results expected from the mineralogy. The conclusion from these assessments is that ABA, in most cases, provides information that can be correlated to the field, mineralogy and to humidity cells. The use of multiple techniques leads to a higher degree of confidence in the use of the data.

Jan 1, 2003

By George S. Dulikravich

An advanced semi-stochastic algorithm for constrained multi-objective optimization has been adapted and combined with experimental testing and verification to determine optimum concentrations of alloying elements in heat-resistant and corrosion-resistant H-Series austenitic stainless steel alloys. The objective was to simultaneously maximize a number of alloy's mechanical properties. This research will result in a rigorous tool for the design of high-strength H-Series steels and other types of alloys unattainable by any means existing at the present time. Such a material-by-design tool will also be able to reduce or minimize the need for the addition of expensive elements such as Cr, Ni, Co, Nb, Ti, V, etc. and still obtain the optimum properties of an alloy.

Jan 1, 2003

By Deborah A. McCombe

"One of the cornerstones of NI43-101 Standards of Disclosure for Mineral Projects is the technical report. The purpose of the report is to provide a summary of the scientific and technical information concerning mineral exploration, development, and production activities on a mineral property that is material to an issuer. The reports must be prepared in accordance with NI43101 and Form 43-101F1 Technical Report and the information must be current as of the date of the filing of the technical report. As these reports provide important information to the investing public, qualified persons preparing these reports should, as much as possible, write in plain, simple language that can be easily read and understood by people who are not geoscientists or engineers. So let’s review some of the common deficiencies with technical reports. Non-current technical report Some of the factors you should consider when determining if your previously filed technical report is still current are as follows: •,Is there new technical information on the property, such as drilling, assays, metallurgical testwork? •,Have you made changes to key assumptions, parameters relating to mineral resources or mineral reserves, or economic analysis? If you have completed the previously recommended work, are your recommendations still current? Similarly, are your report recommendations consistent with what you are telling your shareholders or disclosing in the use of proceeds in your offering documents? For example, if the recommendations in the report consist of further exploration and metallurgical test-work prior to completing a preliminary feasibility study and you have completed the proposed work and are now raising money for a final feasibility study, the report is probably not current."

Jan 1, 2003

By Niall Weatherstone

Introduction Risks & Rewards of a Mineral Reserve Life History of a Mineral Reserve Estimate Risk Assessment & Management Mineral Resource & Reserve Estimation Good Practice Mineral Resource & Reserve Reporting Conclusions

Jan 1, 2003

By Karl J. C. Harries

"7.1. INTRODUCTIONThis chapter addresses the joint venture and examines a number of general concepts of the joint venture relationship. Chapter 8 looks at some specific concepts related to the provisions of a joint venture agreement, which are equally applicable to a shareholders’ agreement or other contractual relationship. The term “joint venture” is used because the author is a common law solicitor (a matter of convenience for which apologies are offered to civil law readers), but it should be noted that, in many aspects, the legal structure of an entity is irrelevant. It is the relationship of the parties, be they venturers or shareholders, that is important, and the areas of concern are surprisingly similar (except for terminology).The details of the joint venture relationship and agreement could fill several books. Accordingly, this chapter and the next focus on selected topics that appear to have caused problems or confusion or to be the basis for disputes. And remember that, although the following discussion is in the context of a joint venture, many of the comments apply, either directly or indirectly, to virtually any common undertaking and the agreement defining it.For interest’s sake, this chapter starts with a summary of some of the earlier types of agreements and arrangements that have evolved into the joint venture agreement of today in Canada, the philosophy of their format, and the reasons for their demise.7.2. EVOLUTION OF THE CANADIAN JOINT VENTUREThe Early DaysMuch of the opening up of Canada’s north is due to exploration for and development of mines. The early discoverers were relatively free to roam and explore at will and, if they were fortunate enough to find something, they dealt with the appropriate government to acquire exploitation rights. The early interests lay in gold or silver. Workings were small, usually worked by the owner alone or with only a couple of helpers to extract the native gold or silver. If the owner wanted to move on, he could sell his property outright and use his stake to look elsewhere.As logging and mining camps were opened, the development of better roads and railways made access easier. Entrepreneurs saw the opportunity to make money by assembling large parcels of land and working them as a single operation. In order to do this, some owners who were not ready to sell out had to be convinced to do so through more attractive offers"

Jan 1, 2003

By E. V. Verhoef

The proposed EU directive on the restriction of the use of certain hazardous substances in electrical and electronic equipment promotes the substitution of lead in consumer electronics to reduce emissions from lead in the end of life phase. In this paper, the consequences of substituting lead in solders is assessed using the Eco-lndicator-99 method for the examples. The base metal production system is considered as an interconnected network modeled dynamically in Simulink 4 and Matlab 6 (Mathworks Inc 2000), where the recovery and production of metal components of the assessed product partially overlap. This approach requires global modeling of metal production processes and mass balances and resulting allocation choices. It also reveals the susceptibility of LeA scores to different choices in the modeling and data availability and uncertainty. Besides the comparison between lead-free and lead-containing solders, other side effects are revealed. Lead is carrier material for the recycling and production of many co-elements in the interconnected production and recovery system. Substitution may have adverse effects such as temporary shortages of other connected metals that are often not considered in normal LeA assessments, thus leading to erroneous results. The suggested approach provides directions for including these external effects and for further assessment of the environmental effects of substituting lead. This paper shows that in order to assess the environmental aspects of metallurgy, dynamic modeling of the total system is required based on the fundamental thermodynamics in each metallurgical reactor, the basis of this dynamic model. With this the true environmental impact of metallurgy can be explained. In the case of lead free solder, it is shown that the mining of substitutes has a very much larger impact.

Jan 1, 2003

By Karl J. C. Harries

"4.1. INTRODUCTIONThis chapter, although divided into four parts, deals with only two principal topics. The first briefly describes and discusses some common types of property interests and considerations relating to them and the second deals with entering upon privately owned lands and obtaining the consent to do so.It should be noted that the terms “mining rights” and “mineral rights” are used interchangeably. As so used, they include the right to exploit the minerals and dispose of them for the benefit of the owner/lessee. This is relatively common in common law jurisdictions. In some jurisdictions, the two terms have distinct meanings, with “mining rights” referring to the right to work or exploit the minerals and “mineral rights” referring to the minerals themselves.Finally, it must be mentioned that the comments in the Introduction and §§ 4.2., 4.3. and 4.4. are based primarily upon Ontario law and Ontario’s mining and real property systems of registration. They have been included for illustrative purposes.4.2. LICENCES, CLAIMS, AND LEASESIn most jurisdictions, there are several basic types of interests that can be obtained from the state for mining purposes and that are of interest to the explorationist, as opposed to the operator. Different jurisdictions will have variations of these and possibly some extra ones that will address special purposes or local concerns. In virtually every jurisdiction, privately owned property rights are obtained through negotiation between owner and acquiror.Exploration or prospecting licence. This licence grants to the holder the right to prospect over a large tract of land and the exclusive right to acquire mining claims within that tract for the term of the licence. Such licences are usually negotiated documents requiring a minimum expenditure during the first year (often secured by a deposit or surety bond) and minimum annual expenditures thereafter to continue the licence in force up to its full term. The term will rarely exceed four years. The number of claims permitted to be staked will be limited in some way, possibly as to a maximum aggregate area or a maximum number of claims per annum. It is normal for the holder to have to drop part of the licensed area each year, so that the area shrinks annually, although exploration expenditure requirements will usually increase.These types of licences are usually used by governments to encourage exploration of otherwise unattractive or remote areas, such as the far northern parts of some of Canada’s provinces. They do not grant any real property interest in the area for which they are issued, and they will be subject to any claims or property rights that exist in the area. They are contracts with the state that grant certain exclusive rights in return for commitments to carry out work. They may or may not be specifically authorized by statute."

Jan 1, 2003

By A-M Fleury

There has been much progress on the issue of acid drainage over the past 20 years; however, significant challenges remain. The International Network for Acid Prevention (INAP) is attempting to address them by globally coordinating acid drainage information sharing and research. INAP pursues three branches of activities: it links AD research, practice, and people; it organises, sponsors, and participates in regional workshops as a forum for technology transfer; and it instigates and funds key acid drainage research projects. Through these activities INAP is helping the industry deal with what is arguably its most serious legacy issue.

Jan 1, 2003

By Fred N. Kissell

This handbook describes effective methods for the control of mineral dusts in mines and tunnels. It assumes the reader is familiar with mining. The first chapter deals solely with dust control methods, regardless of the application. It is a brief tutorial on mining dust control and will be of help to the reader whose dust control problem does not conveniently fit any of the mining equipment niches described in later chapters. The subsequent chapters describe dust control methods for different kinds of mines and mining equipment. This includes underground coal and hard-rock mines, as well as surface mines, stone mines, and hard-rock tunnels. Because dust sampling has so many pitfalls, a chapter on methods used to sample dust is included. For those occasions when there is no practical engineering control, a chapter on respirators is also included. Except for those listed as ?future possibilities? in the longwall chapter, the dust control methods described are practical and cost-effective for most mine operators. If controlling dust were a simple matter, dust problems in tunnels and mines would have been eradicated years ago. Unfortunately, most underground dust control methods yield only 25% to 50% reductions in respirable-sized dust. Often, 25% to 50% reductions are not enough to achieve compliance with dust standards. Thus, mine operators must use several methods simultaneously, usually without knowing for sure how well any individual method is working. In fact, given a 25% error in dust sampling and day-to-day variations in dust generation of 50% or more, certainty about which control methods are most effective can be wanting. Nevertheless, over the years, some consensus has emerged on the best dust control practices. This handbook summarizes those practices.

Jan 1, 2003

By Karl J. C. Harries

"11.1. INTRODUCTIONA royalty is the most common form of interest retained by an owner who is disposing of his property or by a joint venturer who ceases, voluntarily or otherwise, to participate in the joint venture.1 Rarely does a non-participating party have a direct interest in the property and/or assets of a project, except during the period when a non-participating joint venturer may be having his interest diluted.2 In fact, it is most unwise to permit a non-participating party to have such an interest. It may give rise to significant problems that could prevent or substantially delay the development of an orebody and require a considerable amount of time, effort, and money to correct.3In negotiating a royalty, it is important to be aware that there is no law or convention that says, “You just don’t do that in a royalty agreement.” As with any agreement, inventiveness and flexibility on the part of the negotiator are not just assets, but virtual necessities. It is also for this reason that it is essential to read the royalty provisions, particularly the definitions, fully and carefully, especially if you are the recipient. On the other hand, if your inventiveness and flexibility cause your accountant to question the advisability of one of your ideas, pay close attention to him.4 He will, no doubt, have had experience with many royalties, and no competent professional adviser disparages a client’s ideas without good reason. Besides, he will probably be the person who will be determining the royalty or certifying the determination of it. At the very least, he will be auditing your general financial statements, which must, of course, reflect the royalty determination. Heeding his advice not only may make the determination easier but also will probably save you money in professional fees later on. Nevertheless, do not simply accept his comments or recommendations without understanding what they mean, why they have been made with respect to your royalty agreement (sometimes professionals have comments that they make as a matter of course and, even though they may be valid, you should require them to be justified to you), and how they will affect your royalty determination.It is surprising how many corporate payors insist that their standard royalty provisions5 be used as a matter of policy, thereby effectively tying the negotiator’s hands. It is even more surprising, and to professional advisers frightening, how many of the senior employees who insist that such a policy be adhered to, virtually without variation, do not know what is in the standard provisions and would be hard-pressed to explain them to a property owner. If standard provisions are appropriate, by all means use them, but do allow experienced and sensible negotiators some flexibility and make sure that everyone within the corporation who may have to use such provisions – negotiator and supervisor alike – knows what they contain and why they are as they are. For example, there are often good and convincing reasons to describe a deduction in a certain way or to include a certain specific type of deduction. On the other hand, quite often the answer to the question “why?” is that “it has always been there”; this is, or should be, an unacceptable answer. In any event, if you, as the negotiator, appear to know what you are talking about, are familiar and comfortable with your royalty provisions, and are backed up by your boss with the same words or reasoning, a property owner cannot help but be satisfied that you are knowledgeable, even if he still does not agree with your provisions. Finally, if you do use standard provisions, make sure that they are reviewed and updated regularly."

Jan 1, 2003

By R. C. M. Minnitt, W. Dr. Assibey-Bonsu, F. A. Camisani-Calzolari

Born in Bothaville (OFS) on the 26th August 1919, Daniel G. Krige grew up in Krugersdorp on the West Rand. Hematriculated from Monument High School in Krugersdorpin 1934 at the age of 15 and graduated with a B.Sc. (Eng.)degree in mining engineering from the University of the Witwatersrand at the end of 1938 (age 19). In 1938 he joined Anglo Transvaal where he worked on a number of gold mines until 1943, gaining a wide range of valuable practical experience in surveying, sampling and ore valuation. He then joined the Government Mining Engineer’s Department where he worked for 8 years during which time he participated in the uranium negotiations with the British and American authorities and designed the uranium pricing formula for the contracts which led to the establishment of South Africa's profitable uranium industry in the early 1950s. During the same period he began his pioneering work in the application of mathematical statistics to the valuation of new gold mines using a limited number of boreholes and of ore reserves for existing mines. His early papers in the application of mathematical statistics, some republished in French, created world-wide interest that led to the development of the science and concepts that surround the spatial evaluation of mineral resources and reserves known as geostatistics. This technique has contributed to improved ore evaluation techniques as well as the reduction of the financial risks associated with investment in mining enterprises. Furthermore, it led to the recognition of his contributions to the evaluations of mineral deposits through the coining of the term ‘kriging’ that is used to describe a spatial mineral evaluation process known and practised in international mining circles. He continued his work in geostatistics throughout his career as Group Financial Engineer of the Anglovaal Group until his retirement in1981 and afterwards for ten years as Professor of Mineral Economics at the Witwatersrand University. He is still active as a consultant and is a registered Professional Engineer. He has published some 90 technical papers both locally and overseas, some in Russia, and has lectured and participated in international congresses in many countries. His contributions were recognized by the Witwatersrand University through the award of the D.Sc. (Eng.) degree in1963, by three honorary degrees (from the universities of Pretoria, UNISA and Moscow State Mining University), by many awards from the South African Institute of Mining and Metallurgy, the International Association for Mathematical Geology, Die Suid Afrikaanse Akademie vir Wetenskap en Kuns, the SME of the American Institute of Mining Engineers, the International APCOM Council in1999, the University of Antofagasta in Chile, and by the South African President (Order for Meritorious Service, Class 1, Gold). He has served on various Government committees, notably that for State Aid for gold mines (1967/8) and designed the State Aid formula which enabled many mines to survive a period of low gold prices; also various taxation committees, and the mining mission to Iran in 1974. He is a fellow and/or honorary life member of various technical societies locally and overseas, including the Royal Society of South Africa. During the period in the Government service he also handled several of the post-war lease applications in the Free State and Klerksdorp goldfields. The fact that decisions on new gold mines of critical importance to the State and the economy as a whole, were being taken on a limited number of drillholes without any scientific analysis of the risks of failure, stimulated him to start basic research into ore evaluation. His approach was based on the application of Mathematical Statistics to these problems, an approach of which very little was known world-wide at that stage but which had already been initiated in South Africa by Sichel via the lognormal frequency distribution model. In Krige's 1951 paper published in the Journal of the Chemical, Metallurgical and Mining Society of South Africa he covered the statistical explanation of the conditional biases in ore block valuations and stimulated the use by several gold mines of regression corrections for routine ore reserve valuations, a technique which, in effect, was the first use on an elementary basis of what is now known as kriging. His 1952 paper introduced, inter alia the basic geostatistical concepts of ‘support’, ‘spatial structure’,’ selective mining units’ and ‘grade-tonnage curves’. His 1951 paper was based on his M.Sc. (Eng.) thesis submitted in the Department of Mining Engineering to the University of the Witwatersrand, and expounded his pioneering work in geostatistics in more detail. His early research papers that had stimulated interest in several mining circles overseas, were republished in French in1955, resulting in a major research effort by French mining engineers in this field. This, in turn, led to the establishment of the now world-renowned French school of ore evaluation in Fontainebleau, Le Centre de Geostatistique de l’École des Mines de Paris. As the Group’s Financial Engineer at the Anglovaal Head Office until his retirement in 1981, he was responsible for

Jan 1, 2003

By J L. Merritt

Effective minesite water management requires that this issue be treated as a risk management exercise. The management process is generally far from simple and by necessity must involve a range of personnel covering a siteÆs commercial, operational and environmental interests and responsibilities. The challenge to be collectively faced by these stakeholders is to strike the correct balance between risk and cost. On the other hand, the challenge to be faced by technical services support personnel is to provide stakeholders with information in a format that they can use with confidence. This paper presents the application of continuous operational simulation (OPSIM) modelling techniques to establish appropriate risk profiles for minesite operations. It is necessary that the format of these risk profiles be generic and equally applicable for defining the risk of occurrence for a relatively comprehensive range of activities û eg from of a non-compliant discharge, to the risk of failure to meet production targets. What is more, the profiles need to be quantitatively based and capable of reflecting change in system response to varied operational or management strategies. The techniques presented in this paper are based around a key assumption that long-term records of the climate contain within them sets of sequences that are representative of what can be expected in the future û that is, the droughts, floods, cyclones, good years and bad, long or short, and everything in between. Therefore, if these historical records are run through an OPSIM model for a particular site, then the simulated operational characteristics can be taken as being representative of what can be expected in the future, in the long-term. This lends itself to statistical analysis and translation into the required risk based format. Water Solutions Pty Ltd have been working with Capricorn Coal Management to develop a relatively comprehensive OPSIM model of their operations at German Creek Mine, Central Queensland. Outcomes from the modelling have been used in recent times to provide mine management with risk-based guidelines for both securing and containing mine water inventories. One of the more interesting tasks has been to establish risk based inventory levels that, if reached, would trigger the immediate implementation of a contract for the desalination and re-use of mine water, at predefined rates. Also, lead-time warning of the occurrence of a possible trigger is of importance to operational and commercial planning. To service this requirement the OPSIM model is regularly used to produce lead-time estimates to defined levels of confidence. Case studies of these, and other, applications of the OPSIM model at German Creek Mine are presented in this paper and serve to demonstrate an effective methodology for practical risked based water management.

Jan 1, 2003

By A Ruotsalainen

Mining industry sees a comprehensive future in optimisation and process control. High resource utilisation is a starting platform when lower operational costs with higher rate of return are the target. Simulation is quickly penetrating the mining industry as a planning tool. A discrete event simulation helps to visualise the reality of a mine and the various mining processes, which typically include a fair degree of complexity. What-if scenarios can help to determine the impact of occurring changes to production. Understanding of critical points in the layout and resource allocation at an early stage can help to optimise the material flow. The obtained information may then be used as proposal or confirmation of the system applicability and economy. Simulation is a way to fine-tune and optimise the resources within. It helps to predict system sensitivity to various aspects. Although simulation today is used typically in a feasibility stage, there is an opportunity to continue using simulation for further process enhancement. In the future simulation will without doubt be used increasingly as a dynamic simulation and continuous improvement tool. This paper discusses the use of OptimineÖ simulation tool in resource optimisation. Some examples describe the way the tool operates and how it helps to view the technology, mine layout and operational data.

Jan 1, 2003

By J C. de Vries

When times are tough in the mineral industry û as they have been for some time û typical responses by mining companies are to cut costs and/ or increase production. The latter is seen to spread fixed costs, thereby also reducing unit costs per tonne mined. However, most mineral deposits respond to increased production rates by lowering ore grades, so the reduction in cost per tonne of ore does not necessarily result in a reduced cost per unit of metal produced. The authorsÆ experience is that this process often leads to a mine plan that is a long way from optimal. Producing to the point where marginal cost equals marginal revenue may work well in a manufacturing operation, but it is not necessarily the best strategy for a mining company with a depleting resource. Variations in tonnage and grade with depth, ore reserve optimism and a variety of other factors conspire to produce variations in production rates and grade that often result in suboptimal outcomes and potential mine failure. Added to this is the focus of industry analysts and senior corporate management on such measures as unit costs and ounces in reserves. This is perceived to have the perverse effect of driving the share price down when strategies are adopted that actually improve the value of the mining operation, and vice versa! Many mine failures can be prevented by a close examination of the tonnage grade curve and an understanding of how margins, net cash flows and resulting business risk change with cut-off grades and rates of production. A few relatively simple analyses early in the evaluation of a project can demonstrate the tradeoffs between the main decision parameters, leading to right-sizing of the operation. Once major commitments to major capital items have been made, and reserves have been publicly reported, optimisation of the operation becomes much more difficult than if it had been done earlier. Such investigations can also identify the upside potential and downside risks associated with factors outside the companyÆs control. Many strategies that may enhance value in the good times significantly increase the downside risk in the bad times. What is often called risk analysis typically looks at superficial issues, and does not evaluate the major factors leading to the potential for financial disaster. This paper illustrates some of these major risks, and demonstrates how they may be fully evaluated so that corporate decision makers can make fully informed decisions that take account of the real risks.

Jan 1, 2003

This paper discusses the history and development of the system and the benefits that are being gained for Yabulu from Solar Drying. Following the end of mining of the local Greenvale and Brolga nickel deposits, QNI Yabulu Refinery is dependent upon imported ore from over 15 different mines in New Caledonia, Indonesia and the Philippines.

Jan 1, 2003

Water is becoming an increasingly valuable commodity in Australia and the mining community is finding itself competing with pastoralists, domestic consumers and industry for access to what is an essential but finite resource. This paper will provide an overview of various legislative regimes in Australia governing water resources, and will review some of the fundamental issues which should be considered by mining companies when contracting with other parties for the supply of water. The paper will focus on mechanisms to secure access to water for mining purposes, and will deal with the following issues: Grants of water entitlements under legislation û (navigating the legislative requirements necessary to facilitate the taking and use of water for mining activities) The paper will focus on the key legislative requirements for securing access to water in Queensland, Western Australia, New South Wales, Victoria, South Australia, Tasmania and the Northern Territory, and will examine: compliance with regulatory processes for securing water entitlements through the grant of water allocations, licences and permits, etc; and dealings with water entitlements (ie statutory mechanisms for transferring water entitlements on a temporary or permanent basis). Securing access to water under water entitlements through contractual means. The paper will also review of some of the fundamental issues which should be considered by mining companies when contracting with holders of water entitlements for the supply of water from both groundwater and surface water sources. These issues include (inter alia): securing appropriate rights to take and use water in compliance with relevant legislation, the necessity to protect the validity of underlying water entitlements, ensuring the security of supply for the contract term, access rights affecting water entitlements and other important issues relating to the security of water entitlements for miners.

Jan 1, 2003