2014 Software Global Client Conference - Invensysiom.invensys.com/EN/SoftwareGCC14Presentations... · •KPI standards •Recipes ... •BHP Olympic Dam BHP Cannington

2014 Software Global Client Conference

GEN INT-19

Maximizing mine

production/supply chain

through integrated

mining planning &

optimization

Greg Johnson

Suwanee 11

Thurs Oct 2nd 10:45am

3 Confidential Property of Schneider Electric

What do you want to do?

“I want to increase the efficiency of my business in an environment where long

term experience is increasingly rare and competition for talent is increasing.”

“I want to improve asset performance through preventative maintenance,

reduced downtime and increased productivity”

“I want to decrease operator training time while at the same time increasing

situational awareness, making them safer and more productive sooner”

“I want to unify my object model to drive data consistency through the S95

stack”

2014 Software Global Client Conference 4

Agenda

1. Manufacturing & Mining Supply Chains

2. The IPOS Solution for Mining Supply Chain Management

3. Case Studies

A. Brownfield/Opex - Rio Tinto Iron Ore of Canada

B. Greenfield/Capex - Roy Hill Iron Ore

4. Innovation Platform (as IT and mining industry business model changes)

5. Conclusions

Manufacturing

vs Mining


It’s About “Right” instead of “Any”

Return on Asset Profit Margin Revenue Costs

Shareholder Value

design source make store move sell Brand Promise

Right Customer

Right Product

Right Quality

Right Quantity

Right Time

Right Location

Right Price (Cost)

Cost of Sales

S- (G&A) Cost of Goods Sold

COGS Cost of Innovation

R&D

Fin

an

cia

l V

iew

S

up

ply

Ch

ain

Vie

w

Cu

sto

mer

Vie

w

Pla

nt

Vie

w

Risk

Deliver on brand promise attributes Continuously drive down cost

Invest

or

Vie

w

CFO

Sales &

Marketing

Operations/

Supply Chain

CEO

R&D

Plant Manager


Synchronizing Strategy and Execution

STRATEGY

EXECUTION

Production Control

Business Control

Process Control

Delay

Dis

tort

ion

“THE CONTROL GAP”

Quarters Weeks Days Hours Minutes Seconds Sub-seconds

Revenue Growth

Operating Margin

ROA

Temp. Pressure Emissions

Integrated Control


Transformation is Happening Now

Operational Workspace Transition

Modern Operations Execution/

Management System Requires:

Home Grown

Ops Mgt

Systems

Heavily

customized first

generation

Many different

MES/ operation

systems, and

Excel

Operational Transformation • Real time Operational Execution

Alignment

• Enterprise Product Spec Management,

(PLM) across sites

• Operational Alignment

• Value Chain as a unified set

• Consistency of Execution

• Standards in process, equipment,

actions

Inte

gra

tio

n

Fe

de

ratio

n

Islands of

Expertise/

Control

Pe

op

le

• Operational Teams

• Decisions in the NOW

• Embedded governance

• Model-driven Operational Practices

Agility and Increased Speed

on Innovation and Change

Ag

ing

Exis

tin

g O

pe

ratio

ns

Ma

na

ge

me

nt S

yste

ms


Federation of Operational End to End Value Chain

as a Virtual One

One Virtual Manufacturing Chain

Vs Individual sites and operations

Direct Linking between Sites

Standards across the sites

• KPI standards

• Recipes

• Equipment Standards

• Operational Practices

Planning Across Multiple Sites

• Real-time status of plants

• Understanding of jobs

• Consistent Plan across sites

View and Transparency

across sites

• Consistent Measures

• Trusted

• Logical Navigation


Embedding Operational Processes



Mining and minerals Manufacturing

A smelter or refinery cannot be stopped so there is inherent

production push in the process

An assembly line can be stopped so there is the ability to

create pull systems

Production is in continuous units and around the clock Production is in discrete units and often on less than one

day cycles

Generates considerable dust Little dust

Physically challenging environment Ambient conditions

Inherently variable environment Stable work environment

Remote locations Large centres

Impact of weather Indoor environment

Inherently variable raw materials Controlled raw materials

Geographically spread output teams Compact plants

Molten metal has a short shelf life before it solidifies Long-life components suitable for supermarket-style

storage

K Dunstan, B Lavin and R Sanford, 2006 “The Application of Lean Manufacturing in a Mining Environment”, International

Mine Management Conference Melbourne, Vic, 16 - 18 October 2006, pp145-147

Mining vs Manufacturing


Data Issues in the Mining Supply Chain

● Inaccurate mining material movements

● Product and waste material unable to be

separated

● Inaccurate reserves estimates

● Changing quality profiles within mine

design blocks / stopes

● Placement and accuracy of sample

equipment and the timing of assay results

● Placement and accuracy of material

weightometers and /or flow meters

● Downtime events changed post shift

● Calibration of automated data capture

devices

● Data capture systems not utilised as

designed

● Ability to track and capture material

genealogy

● Ability to accurately measure the start and

end of mining blocks

● Manual and / or Excel data capture

systems

● Timing and methodology for month-end

surveys

Mining Supply

Chains


Mining Companies are Striving to Achieve

Resource-to-Market Potential

Lack of dynamic and

optimized extraction

sequencing leads to

increased cost

Unreliable

Production

Accounting reports

lead to wrong

decisions

Poor Process

Performance

leads to

increased cost

Excess energy

& water

consumption

affects license

to operate

Poor Asset

Performance (OEE)

leads to demurrage

fees

Non

conformance to

load out plans

leads to

transport

penalties

Poor decisions on spot

sales opportunities

leads to lost revenue

Maintenance &

Production

conflicts cause

unnecessary

delays

MAXIMIZE VALUE CREATION

MAXIMIZE OPERATION EFFICIENCY

OBTAIN AND MAINTAIN LICENCE TO OPERATE


Plant Supervision Fleet Control

MAINTENANCE MANAGEMENT

Maintenance Plan

MRO Procurement & Inventory

Work Execution

Mine Planning Demand Management

System Issues in the Mining Supply Chain

Operations Focus (Maximize Throughput)

Asset Focus (Reduce Maintenance Cost)

Plant Supervision

•Spreadsheet proliferation

•$2million penalty due to 1 spreadsheet error

•Lack of visibility across the real time business

•Lost spot sale opportunities

•Timeliness and accuracy of data

•Lost productivity

•Lack of integration “management silos”

•Can’t respond to fast moving commodity cycles

•Lack of standard solutions

•Mining culture

•No one has seen it fully deployed

•Realizable architecture

•Cost

‘

Meeting Mining’s Systems Challenges’

SAP Mining & Metals

Peter McLure, CIO, MMG Limited, September 2012

Drivers for Change Inhibitors of Change


Plant Supervision & Advanced Control Fleet Control

Manage Production & Inventory

ASSET PERFORMANCE MANAGEMENT

Asset Management Strategy

Maintenance Plan

MRO Procurement & Inventory

Work Execution

Improve Performance

Mine Planning Order Management

Cloud Services

(Weather, Asset

Management,

Energy Services

Monitor Condition

Today’s Mine - Leader

Operations

Focus (Right Throughput)

Asset Focus (Right Availability)

Integrated Operations Center (Visualization, Integration, Decision Support)

Simulate, Plan & Schedule

Improve Performance. Integrated Energy Management

Plan & Schedule

Process Excellence Center (Analytics, Benchmarking, Improvement)


Plant Supervision & Advanced Control linked to Business Fleet Control

INTEGRATED PLANNING & OPTIMIZATION SOLUTION – Over entire value chain

Simulate, Plan & Schedule; Manage Production & Inventory; Improve Performance

Integrated License to Operate Management (Water, Safety, Emissions)

ASSET PERFORMANCE MANAGEMENT

Asset Management Strategy; Maintenance Planning; MRO Procurement & Inventory

Work Execution; Improve Performance

Mine Planning

Enhanced Cloud Services

(Weather, Asset

Management, Energy

Bureau)

Monitor Condition

Tomorrow’s Mine

Total Optimization

Focus

Integrated Operations Center (Visualization, Integration, Decision Support)

Process Excellence Center (Analytics, Benchmarking, Improvement)

Integrated

Planning and

Optimization

Solution


Integrated Planning and Optimization Solution

Mine Planning

Concentrator &

Smelter Planning

Cathode

Production

Metal

Balancing Stock Management

Logistics Planning

Rail, Road & Port

Act

Plan

Do

Check

Supply Chain Operations APS

Plant Operations Ampla


Plan – Resource-to-Market

●Minimize movement of material, direct feed ship where possible


Do - In-Plant Crusher & Conveyor


Check

Dashboard

Analysis Client

Mobile App

Cisco Architecture

Invensys Workflow (Skelta)

Wonderware Historian

Case Studies


Iron Ore Company of Canada (Rio Tinto) The company operates a mine, concentrator and a pelletizing plant in Labrador City, as well as port

facilities located in Sept-Îles, in the province of Quebec. It also operates a 418-kilometre railroad that

links the mine to the port. IOC currently employs more than 2,500 employees and has the capacity to

produce approximately 18 million tonnes of iron ore concentrate per year.

We required a partner who could deliver one integrated

solution across our entire supply chain, including the rail

and port. Schneider Electric not only had that solution but was

able to work with us for the initial scoping of the project, manage

the software implementation and then deliver onsite engineering

and post implementation training and support.”

Diane Courtemanche, Director Technology Integration, IOC

Brownfield Operation

Priority to Stabilize and

Improve

Delay Accounting,

Metrics, Trusted

Information

Next Step – Capitalize on

Improved Reliable

Performance

Advanced Scheduling


"We are utilising Schneider Electric's sophisticated APS modelling approach to help us predict how

each entity in the demand chain will operate (mine, plant, rail and port), not as discrete

components, but as a single system that is operating with unified objectives and associated KPIs" says

Lomman. "This has allowed us to gain visibility, before any CAPEX has been spent, on where we expect

system constraints. We can continually test operating scenarios and see potential impact on both

throughput and grade variability across the entire demand chain.“

Mike Lomman, General Manager Demand Chain, Roy Hill

http://www.schneider-electric.com/solutions/ww/en/ref/314456088-schneider-electric-to-deliver-resource-to-market-simulation-and-optimisation-to-roy-hill-iron-ore?segment=4872956

Roy Hill Iron Ore

Greenfield Operation

Priority to move

quickly to operating

status

Simulation, advanced planning

and scheduling

Next Step – operational systems for

reliable control

Delay Accounting, Production Accounting,

Inventory

Greenfield development will consist of: •55 Mtpa mine , processing plant , airport and permanent accommodation village

•344 kilometer heavy haul railway linking the mine and port

•Port stockyard and two-berth export facility in Port Hedland

•Corporate Headquarters and Remote Operations Centre based in Perth


Alumina Refinery

• Ship (Bauxite) unloading

• Increased by 1 ship a year

• 0.45% production improvement

• $6.6M increased revenues

Zinc & Lead Filter Plant

• 5 filter presses (4 Zn, 1 Pb/Zn)

• Increased utilization 78% to 94%


• 100Ktpa increased production

Manganese Mine

• Primary crusher to final product

• Targeted production rate loss

• 20% production improvement

• 600Ktpa increased production

Cement Plant

• 2 Cement Kilns

• 50% reduction in stoppages


• $1.6M increased revenues

Coal Operations

• 8 wash plants and 1 port

• Targeted production rate loss


• $200M increased revenues

Olympic Dam Mine

• De-bottlenecking underground rail

• Increased availability by 3 hrs/day


• 1.7Mtpa increased production

Disclaimer:

• Names of some operations were withheld as the information was supplied to Schneider Electric only and not available in the public domain

• Numbers provided for unnamed case studies were rounded (approximated) based on “best guess” commodity prices and annual production levels

Case Studies: Benefits

RTCA Hail Creek Operations

• Train Loadout (TLO)

• 2 Coal Handling Preparation Plants (CHPP)

• 44% Reduction in duration of delays within CHPP

• 48% Decrease in delay occurrences in CHPP

• 25 % Increase achieving Train Freight Incentive Scheme

Clients:

Mining/Crushing:

• BHP Iron Ore (Pit)

• BHP OD (U/G)

• Illawarra Coal (U/G)

• RTCA Kestrel (U/G)

• RTCA Clermont (IPCC)

• BMA Crinum (U/G)

Concentrators:

• BHP Olympic Dam

• BHP Cannington

• BHP Nickel West (All)

• MMG (3 sites)

• Rio Tinto ERA

• Kennecott Copper

Refine/Logistics:

• BHP OD Refinery

• BHP Nickel West KNR

• BHP Iron Ore Rail

• Xstrata NCA Pit-to-Port

• RTCA Hail Creek Rail

• RT Alcan Gove Ship

Copyright 2012

Innovation


The future of Industrial Software

Industrial software will become more autonomous and smarter.

“from decision support systems to decision systems”

To achieve this, systems will integrate much more data horizontally and vertically. This is

what’s behind the trend for IT/OT* convergence. ● To sort through all this data in real time, we will use Artificial Intelligence to look for Patterns, apply forecasts and

run simulations to derive optimal decisions in real time.

Alarms will become Intelligent Events ● Single-system, threshold-based alarms will be replaced by complex triggers which take inputs from PLCs, SCADA,

Historian, MES and Optimisation sources.

● Event thresholds will be dynamic and multi-dimensional

●Eg: The water level in a holding tank is critically high BUT there is no rain forecast for 48 hours AND there is sufficient

production planned to reduce the level to a normal state = No alarm.


The future of Industrial Software

Instead of “thresholds” we will discuss “Managing Risk”

● The tank water level is no longer a fixed threshold. Notifications will be

driven by real-time calculations of risk. Risk to production, risk to safety,

risk to equipment, risk to environment.

● New styles of user interfaces will evolve which will be more effective for

mobile devices.


Innovation Example 1 – ASM for Managers

CURRENT: Utilisation < 60%

Updated: 10:00 am

PREDICTED: Demurrage Cost > $2,000,000

Updated: 10:00 am

PREDICTED: Customer Loss > $10,000,000

Updated: 10:00 am

Last Data Update: 10:00 am

Update Completeness: 100%

Information Accessed: 10:11 am

33

Innovation Example 2 – Cloud Services Analytics

CIM Annual Conference Tuesday May 13,

Mine to Mill Track 09:20 - 09:45 Presentation

38: Weather & Production Analytics for

Performance Improvement & Better Planning.

34

Analyze Wind, Rain, Snow, Air Pressure etc …..

against Production, Energy, Safety –

Quantitatively, Always, No Special Effort

Conclusions


Realize Your Resource-to-Market Potential

Lack of dynamic and

optimized extraction

sequencing

Costly decisions due

to unreliable data

(Inventory, Grade)

Poor Process

Performance

(Quality, Recovery)

Excess energy &

water

consumption

Poor Asset

Performance (OEE)

Non conformance

to load out plans

● Mineral resources and commodity prices are externally determined

● Only HOW the resource-to-market chain is managed is controllable

● Goal is to deliver to the market at the right quantity, right time, right grade, right quality and right cost

● Make the most of your Resources by:

● Planning and scheduling to optimise the Resource-to-Market chain (local plans are driven by the global plan, not vice versa)

● Making production, asset and process performance more RELIABLE and more capable

● Making better decisions through reliable and timely infomation

● Reducing cost and improving environmental performance by reducing excess energy and water usage

High cost of poor

utilization

Maintenance &

Production conflicts

cause delays


I want to know the optimal plan.

I want to execute the optimal plan.

If I cannot execute, then I need to know the root cause.


Related Support, Services, Training & Expo Demos

> Global Support Center

> Live Chat

> Knowledge Base

> Guided troubleshooting

Support

Training

> Classroom training

> Onsite training

> Custom training

> Online training and ‘How to’ videos

> Business consulting

> Project management

> Implementation services

> Post implementation

> Maintenance services

Services

Expo Demos

> Industry wall: Mining, Metals & Minerals

> Inventory Accounting for Mining, Metals and

Minerals (station #26)

> Integrate and optimize your supply chain

operations (station #27)

39 ©2014 Schneider Electric. All Rights Reserved.

All trademarks are owned by Schneider Electric Industries SAS or its affiliated companies or their respective owners.

Documents

2014 Software Global Client Conference - Invensysiom.invensys.com/EN/SoftwareGCC14Presentations... · •KPI standards •Recipes ... •BHP Olympic Dam BHP Cannington