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Outsourcing of specialist and non-continuous services is common practice in international mining operations. There is an increasing trend towards this practice in South Africa as a result of the major organisational changes that have taken place in the industry, and as lower revenues and production cost pressures have reduced profit margins. Many specialist functions have been outsourced in the industry for a long time, an example being shaft sinking, which is undertaken by specialist shaft sinking contractors. In the professional services area, some activities have been outsourced, for example the design and construction supervision of tailings dams, but mining related activities such as geology, mine planning and scheduling, engineering, ventilation, and rock engineering, have traditionally been carried out by in-house staff. In this paper some of the industry problems which have led to an increase in outsourcing of professional services are considered. Then the pros and cons of outsourcing are dealt with before outlining the factors which should be taken into account in choosing an outsourcing partner.

Jan 1, 1999

Outsourcing of mining operations and services is done for various reasons and there is no single model which fits all situations. Experienced contractors and mine owners have also developed, more often than not, jointly, numerous commercial arrangements and project delivery methods to suit their particular project. It is often the case that some mine owners who have not considered outsourcing to contractors do so because of a simple lack of understanding of the potential benefits. This paper will highlight the potential benefits and perceived disadvantages of outsourcing for mine owners and demonstrate how these issues have been addressed by the mining contracting community over recent times as well as demonstrate the evolution of current commercial arrangements in engaging mining contractors.

Jan 1, 2006

By L. M. Scovell

The Internet and its related technologies will radically change the way that mines manage and control their maintenance, repair, and operating supply chains. The Internet is creating new distribution channels and offers new technology platforms with significant advantages over more traditional methods. Mines will have to re-evaluate both the strategies and the tactics employed in these areas. Mines will use e-commerce to integrate their maintenance, repair, and operating supply chains. The integration will extend beyond traditional trading partners to a worldwide network of communities with similar interests and goals. The changes will transform the way mines operate, lower mining costs, and thereby increase their chances of success in an increasingly competitive environment.

Jan 1, 2000

By C. Frenzel, N. Blechschmidt

"INTRODUCTION There is no doubt about the time and effort companies put in establishing and maintaining their equipment. However, the question about how these companies can map the benefits comes up. Neither do they have the tools to quantify the benefit of their action, nor do they have the tools to know the actual quality of their current maintenance system. The resources used in the process seem futile to observers. It seems impossible to trace improvements and to get information about the impact of actions in retrospect. Improvements in maintenance performance cannot be recognised by management or shareholders. Thus the necessity for measuring the performance of maintenance systems is given. In this paper ConMoto is systematically showing the strengths and weaknesses of many companies' maintenance management and is providing field-tested proven design elements for measuring maintenance systems and implementing Value Oriented Maintenance. Considering only business assets in production facilities and related machinery out of all investment goods in Europe, you reach a value of around 9.7 trillion euros in 2008. In Germany alone the equipment replacement value amounted to about 1.9 trillion euros [8,10,11,13]. If you calculate a cross sector maintenance costs rate of 4.8 % (corresponding to the average value identified in this study), direct maintenance costs in European production locations add up to over 450 billion euros per year [3]. These figures speak for themselves. Yet maintenance is not only of enormous significance for European enterprises. Our experiences show that maintenance and asset management, particularly sustainability issues, are also increasingly moving to the forefront in the BRIC states, in the Middle East and in many emerging countries. First of all, in order to meet the resulting high quality and cost related requirements of maintenance systems, a comprehensive overview of the issue is needed. This overview is provided by a detailed analysis of 83 companies and production plants from various sectors – with amazing results. SIGNIFICANCE OF MAINTENANCE Current studies show the high financial significance of maintenance and asset management. According to the market study in the Asset Manager [9], in industrialised countries about 10 to 15 per cent of the labour force are employed in maintenance and facility management tasks. In Europe about 40 to50 million people are directly and indirectly involved in retaining the value of machinery, plants, buildings, transport systems and infrastructure facilities. A glance at the costs side also demonstrates the great relevance of maintenance. EU-wide annual direct maintenance costs amount to a total of more than 1,500 billion euros. In Germany alone they are about 250 billion euros. This impressive total is considerably exceeded by indirect maintenance costs caused by technical failures. Indirect costs are estimated to be five times higher (Figure 1). [7,12,14]"

Jan 1, 2018

By M Berry, F MacCorquodale

The ownership, management and employment structures operating in the Australian minerals industry have dynamically evolved during the last 30 years. One of the most dramatic changes, from an exploration and mining geology perspective, is the reduction of in-house geological expertise and an ever increasing reliance on contract and consulting services.For all companies - big and small - two key issues resulting from these changes are the management of core geological intellectual property (IP) and competitive advantage. This is because there are less experienced geologists at exploration and mine sites, there are fewer head-office technical service teams to support mine sites, exploration teams are smaller with less specialists employed, and there is an ever-greater dependence on contract and consulting services.This paper reviews and explores these issues with an industry-wide geological context, then provides a case study of how Newcrest Mining Limited (Newcrest) has dealt with these issues in exploration. Newcrest has grown from a one-mine company with an Australian exploration focus, to a large global company with multiple operations and an extensive international exploration portfolio. NewcrestÆs management of its geological IP and competitive advantage has evolved as the company has grown and responded to market conditions, including its internal restructuring in mid-2013.CITATION:Berry, M and MacCorquodale, F, 2013. Managing geological intellectual property and competitive advantage - Newcrest Mining LimitedÆs experience, in Proceedings World Gold 2013 , pp 37-44 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Sep 26, 2013

By J Kwak

Driving sustainability concepts and practices into the heart of the design process is the key to achieving a successful, sustainable plant design. Engineering design practices, tools, systems and methodologies should be prepared around true eco-efficiency parameters, adopt wholesystems-thinking and consider life-cycle impacts for the design task. Experience dictates that the application of sustainable plant design practices is most likely to succeed if: The principles are well documented and explained. All stakeholders agree on what sustainability means. Sustainable plant design is treated as a core process. The principals of sustainable plant design are equally applicable in brownfield and Greenfield environments. Although brownfield situations provide the designer with less latitude for change, these types of projects do allow easier measurement and demonstration of relative impacts. This paper further develops the above points by drawing on case studies from HatchÆs repertoire.

Jan 1, 2004

By J. E. Amadi-Echendu, F. Stober, J. Ndlovu, L. R. Nelson

The Polokwane Smelter Complex (PSC) relies on a single 68MW high-intensity six-in-line furnace to smelt a planned 650 000 t/a dry concentrate to produce a platinum group metals (PGM)-bearing matte. As typical of a greenfields venture, considerable attention was paid to the project development and implementation stages of design, engineering, construction and commissioning. Somewhat unusual though, was the role of a dedicated multi-disciplinary "Operational Readiness" and support team, comprising the owners team and specialists from the furnace designer, HATCH, to effect a safe and rapid ramp-up to the design smelter capacity of 68MW. The challenges encountered in developing an effective partnership will be discussed. The modus operandi and roles of the "Operational Readiness" team during the design, procurement, construction and commissioning stages as well as that of the operational support team within the overall ramp-up objective will be presented. The "Operational Readiness" team was responsible for:

Jan 1, 2005

By Bruce Cavender

Managers are frequently faced with the decision to perform a task or manufacture an object in-house or to hire an outside vendor to perform the function. Outsourcing decisions are usually driven by economics: work is outsourced if it can be completed at a lower cost or in a shorter time than it can in-house. A technique termed incremental analysis can be used to make this decision. Incremental analysis examines the financial impact of outsourcing decisions as a function of the firm's fixed and variable operating costs. To use this tool, individual components of production cost are identified as being either constant or varying with levels of production activity. The assignment of cost type can be made in several ways: though analysis of historical operating data, understanding of individual expense types, and so forth. Changes in fixed and variable costs resulting from each potential course of action are explicitly identified to project the financial outcome of each alternative. The alternative having the greatest positive impact on profit is selected for implementation. By using the fixed- and variable-cost framework, the analysis is conceptually straightforward and substantially simplified. Production managers can therefore use incremental analysis as a tool for fast economically beneficial decisions on a real-time basis.

Jan 1, 1999

By C Dick

Over the past three decades, mining operations have seen a significant increase in the use of contractors for mining, camp management and catering, recruitment, maintenance, power management, and commissioning. More recently contractors have been engaged for stores and logistics, OH&S, environmental, exploration, training etc. In some countries, such as South Africa, the trend is towards total outsourcing of all aspects of a mining operation which is coordinated by the owners’ management team.During the Global Financial Crisis (GFC) more Australian companies considered and/or took on this approach to recruiting for both projects and operations as mining companies were forced to rethink their corporate strategies as commodity prices plummeted to low levels, pushing operations and projects into potentially financially unviable territory.This paper discusses the labour recruitment, commissioning and operating strategy of Western Areas NL (WSA), with the assistance of Independent Metallurgical Operations Pty Ltd (IMO), as it progressed construction, commissioning and operation of the Cosmic Boy nickel concentrator at the Forrestania Nickel Project during and post GFC. The use of IMO contractors allowed Western Areas to mitigate labour cost risk during the uncertainty caused by the GFC and let their management team focus on the task of bringing a new operation into viable and profitable production.

Aug 8, 2011

By J. Hendry, K. Brady, J. Yorzyk

Drawing from the experience of nickel, copper, aluminum and mineral borates, this paper illustrates the business value that the mining, minerals and metals industry as a whole can gain from applying life cycle assessment (LCA) to products and operations. Through the use of case studies, the paper explores how companies and industry associations have used LCA to their advantage: from evaluating capital investments, meeting customer information needs, supporting new product applications, and developing credible marketing information on the environmental performance of their products. It also explores the dynamics of LCA adoption and integration within companies, and provides recommendations to further strengthen institutionalization of LCA.

Jan 1, 2010

By J. B. Greenwood

The paper point out some reasons why contract mining should not achieve the same success in Latin America as it has in Australia. In this sense, any reasons are: the size of operation, mining industry employees bonus scheme, the privatization of nationalized mining assets, general sales tax and the mining unions. Therefore, great deal depends on the attitude or "mindset" of a company's employees. lt is strongly my view that the attitude with which a contractor approaches a job will give rise to a superior mindset amongst its employees when comparad to those from most mining companies. The value of this cultural difference is significant and should never be underestimated. lmportantly, it doesnot only manifest itself in a more productive workplace: it is invariably the case in Australia that the safety achievements of contract miners are superior to those generally expected from the mining industry at large.

Oct 6, 1999

A combination of the needs of business, employee desires and safety and health considerations is stimulating increasing attention to the time spent by people at work and the timing of that work. Particularly we are seeing: - innovative work schedules for 24-hour mining businesses; and - response from industry to accommodate the needs, even the desires, of employees in return for systems which are more productive and more capital efficient. There appears to be an evolutionary trend for business management to become more sophisticated and responsive to the need for achieving close to best cost work schedules to sustain continuous improvement. The underlying motivating forces driving this trend for improved techniques in organising attendance at, and time spent at work, is the seemingly inseparable combination of technological advance and ever-increasing accumulation of capital. The mining industry has not remained untouched by this thrust for ever-increasing need for best use of labour, to adopt advances in technology and to provide attractive opportunities for putting accumulated capital to work. An essential component of this on-going thrust is a substantial effort by the mining industry to improve the performance of labour by providing most-productive work schedules.

Jan 1, 1996

By C. Gaubert, G. Bourassa

"The construction or rebuild process in the anode baking furnaces has been modeled with the software Rockwell Arena, in order to minimize the process cost and risk. The case study was focused on the sectional rebuild (""on the fly"") that needs a high coordination of the material inventory, the on-site personnel and the construction/production schedule. Multiple entities and resources were allocated for the different part of the process (in-furnace process, prefabrication, materials transportation, etc.). Logic flow charts and VBA macros were used to simulate the space utilization (including cranes utilization) and interaction with production. MS-Excel output files can show user-friendly results."

Jan 1, 2006

Mining and mineral processing makes a vital contribution to AustraliaÆs national export income, and our society today is critically dependent on its products. Despite the importance of this industry, its operations often come under scrutiny because of its high potential impact on local environments û both social and ecological. The challenge for the minerals industry today is to make the most responsible and best possible use of the national resource base, maximising overall resource utilisation.Research efforts and industry implementation of improvements have been moving in this direction for a considerable time already, and the industry has a long history of process innovation and improvement in Australia. Examples range from the early development of gold cyanidation and mineral flotation to more recent work undertaken under the auspices of AMIRA or through the various CRCs and research organisations such as the AJ Parker CRC for Hydrometallurgy, the Cooperative Research Centre for Mining Technology and Equipment and the Julius Kruttschnitt Mineral Research Centre.However, the nature of research and innovation in the mining and mineral processing sector is changing, as the industry itself copes with the pressures introduced by globalisation, industry consolidation and commodity price cycles. Large firms that have historically maintained a tradition of corporate technology and a culture of innovation are moving to outsource their technological and research competencies and are adopting æfast-followerÆ mentalities. At the same time, the challenges of sustainable development that need to be addressed are many-faceted, multidisciplinary, and require a holistic approach for significant achievements to be realised. Many sustainability issues, particularly those pertaining to environmental and safety issues, are shared across large sections of the minerals industry, and are seen as æindustryÆ problems beyond the scope of a single company.In this environment, collaborative research efforts are becoming the dominant mechanisms for building on past innovations and ensuring the continued success of the mining and mineral processing industries within a framework of sustainable development.

Jan 1, 2004

By G Malherbe, J Gonzalez, D C. Franklin, J Bassan, C T. Farrelly

To respond to ever-increasing challenges, mining companies have been experimenting with new business models and technologies in order to speed mine development, production, processing and transport. The various experiments involve mobile access to data, intelligent sensors, advanced analytics, virtual collaboration, virtual reality, automated equipment, remote operations centres and strategic partnerships. A synthesis of all these components creates a ænetwork effectÆ that can dramatically improve the overall effectiveness the entire operation. The concept of the Network Centric Mine borrows from a variety of industries, including defence, aerospace, aviation, petroleum, utilities and manufacturing. Central to the concept are improvements to the way we connect people, process, information and technology, resulting in a more highly collaborative business model, with roles and processes designed to take advantage of new technology. The components of the mining operation act as a connected network aimed at a common goal, regardless of the boundaries of organisation and location.The design of this new organisational ecosystem needs to take into account the recent advances that enable the æplug and playÆ integrated collaborative environment, including cloud computing, mobile devices and social networking, as well as advances in augmented reality, robotics, geo-location, digital labelling, simulation and analytics. However, the most consistent lesson from other industries is the need to properly enable the behaviour and process changes necessary for success.Benefits from adopting a network centric approach include the more effective use of scarce expertise, improved data and information analysis, reduced process variance, and more informed and faster decision-making. The future of mining will see more technology savvy workers who will drive the adoption of new processes. The operations will shift from a relatively static and disparate set of functions, to a digitally aware, dynamic, automated, integrated and interactive environment, with increased agility, lower operating costs, higher productivity and improved safety.CITATION:Farrelly, C T, Malherbe, G, Gonzalez, J, Bassan, J and Franklin, D C, 2012. The network centric mine, in Proceedings International Mine Management 2012, pp 143-160 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Nov 20, 2012

The original and most basic relationship between mining company and explosive supplier was a simple one of consumer and product supplier. The divide between the two was quite clear-cut with neither taking much interest in the activities of the other. The explosive supplier had little understanding or share in the outcome, efficient rock breakage and therefore impact on mining and milling. Likewise, the mining company did not encourage the improvement or development of products. The transactions were limited to product and funds. This environment does not encourage any form of knowledge sharing, trust or optimisation of the mining process.Conversely, there are now a variety of relationships to the point that the mining company may simply be an asset manager whereby all æoperationalÆ aspects are contracted out. For the drill and blast aspect this takes the form of a æRock-On-GroundÆ contract whereby the explosives company takes on design, drill, load and fire responsibilities and is paid a rate per volume of broken rock. This removes the majority of risk to the mining company derived from having to produce broken rock and guarantees the cost of a portion of the overall unit cost of mining. The onus is now on the explosives supplier to break rock to a specification as efficiently as possible.There exist a number of variations between the æbasic supplyÆ and æRock-On-GroundÆ. These contracts may also include value sharing to encourage the explosive supplier to optimise the mining operation to maximise profit.This paper looks at some of the drivers for the change in explosive supplierûconsumer relationships and examines the æprosÆ and æconsÆ of a few of the options.

Jan 1, 2004

By S L. Martin, M Wimberger

The binary indicator coding of assay and lithological data according to a single criterion or multiple criteria is a powerful technique for representing mineralised shapes through the modelling of probabilities. This can be as simple as using a single indicator to model the probability of occurrence of a condition, usually a grade threshold or a lithology, but it can also be used with a number of categories. Case studies are presented to show the power of this approach, where the geological controls on mineralisation or on the distribution of a rocktype or alteration, often coupled with mineralisation, are unclear. The categorical approach is often used as a de facto grade filter in disseminated or stockwork mineralisation. The ultimate expression of the indicator formalism is in multiple indicator kriging (MIK), where a conditional distribution of probabilities is generated for each estimation panel. This has applications in recoverable resource estimation, as the input for continuous or categorical simulation, where the distribution of sample grades is multimodal, or when there are superimposed mineralisation events with different orientations. However, in some cases, MIK is being used as an excuse for ignoring a quality geological interpretation. Examples from the public domain show the abuse of the categorical and MIK approaches to modelling probabilities, together with a plea for greater consideration of the geology.

Mar 22, 2022

By J. O. Marsden, M. M. Botz

"Heap leaching is responsible for approximately 21 percent — 3.9 million metric tonnes — of copper production and 9 percent — 270 metric tonnes or 8.7 million ounces — of gold production worldwide. Given metal price assumptions of $2.25/lb for copper and $1,250/oz for gold, these portions of global production generate revenues of $19 billion and $11 billion, respectively. For heap leaching operations, small changes in metal extraction efficiency drive substantial changes in operating cash flow margins and affect project viability. Variances in actual metal production from budgetary forecast estimates can mean the difference between success (value creation) and failure (value destruction) for a heap leach project. Despite the importance of heap leaching for copper, gold and silver production worldwide, there are no clear standards or guidelines for developing heap leach metal production forecasts. There is considerable variation among copper and gold producers that apply heap leaching technology as to how such modeling and forecasting is applied at the operational level. There are a variety of different modeling approaches that can be utilized for this purpose. However, these vary in cost, complexity, time to implement, accuracy and credibility. This paper explores the options available for heap leach modeling, discusses the advantages and disadvantages of each approach, and provides guidelines/recommendations for an effective approach to modeling metal production at existing or planned heap leach operations. The paper also provides expected ranges of variation between actual and modeled production.Introduction and backgroundHeap leaching is fundamentally different from other methods used in the processing and extraction of gold, silver, and copper and other base metals. Considered globally, the technique represents a relatively modest portion of production compared with the primary technologies applied for copper and gold recovery. Approximately 21 percent of copper production is attributable to heap leaching techniques, as opposed to 79 percent by conventional crushing, milling, flotation, smelting and refining. For gold, about 9 percent of global production is obtained from heap leaching, compared with over 90 percent by various combinations of crushing, milling, gravity concentration, flotation and/or agitated cyanide leaching processes or, in the case of placer deposits, by direct gravity concentration and/or amalgamation. In cases where heap leaching is the primary source of metal production, the ability to accurately forecast metal production may be the difference between commercial success and failure for a project or operation. Heap leaching — of crushed or run-of-mine ore — is also commonly applied as a secondary process to treat lower-grade ores from a given deposit, such as at Chuquicamata in Chile, Cerro Verde in Peru and Bagdad in Arizona for copper extraction and at Twin Creeks and Carlin, both in Nevada, for gold. In such cases, heap leaching provides incremental revenue to supplement the primary process. Variances between actual and forecast metal production from heap leaching as a secondary process are typically tolerated and absorbed within the overall site metallurgical balance. In either case, accurate production modeling and forecasting creates significant value for heap leaching projects, is essential for managing production expectations — timing and volumes — and is likely to be a critical success factor for most heap leach projects."

Jan 1, 2017

By B Harvey

Achieving community and stakeholder endorsement during life-of-mine planning and implementation requires a business-connected approach, as opposed to charitable giving, disconnected offsets and environmental adventurism.CITATION:Harvey, B, 2014. Extractive companies, development and environmental agendas, in Proceedings Life-of-Mine 2014 , pp 19–22 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 16, 2014

By A C. Robertson

Over the past decade there has been continual change in the way that mines have been managed and the component roles of those people who make up the total mine management system. Major issues have included the change in the business structure of mining companies, the change in on-site infrastructure, increased personal liability of managers for the safety and health of employees and increasing social and environmental pressures on managers and their staff. This paper looks at the changing roles of two of the many groups of professionals associated with the mining industry - the equipment supplier and the mining consultant. The profiles of the ACME Group Pty Ltd, suppliers of ventilation equipment and ancillary canvas and plastic products to the mining and construction industry, and Tennent, Isokangas Pty Ltd, Consulting Mining Engineers, are presented.

Jan 1, 1998