Keith Whitchurch, Pt SMG Consultantssmgc.co.id/wp-content/uploads/2012/10/Company-Presentation-of... · Simple Example Deposit OB Depth 30m Coal Thickness 5m ... Lerch Grossman Pit

OCTOBER 09

Deposit Evaluation Techniques

Keith Whitchurch, Pt SMG Consultants

Insert your Company Logo here

OCTOBER 09

What questions are being asked?

• What sort of deposits is it?

• Simple

• Complex

• Single seam

• Multi seam obvious base

• Multi seam no obvious base


OCTOBER 09

What questions are being asked?

• How big is the reserve?

• How should it be mined?

• What order should it be mined in?

• HOW DO I MAKE THE MOST MONEY?


OCTOBER 09

Deposit Evaluation Techniques

• Strip Ratio

• Cash Margin Ranking

• Lerch Grossman Pit Optimiser

• Next Generation Technologies


OCTOBER 09

Simple Example Deposit

OB Depth 30m

Coal Thickness 5m

Coal Ash 2%

Coal Density 1.30 T/bcm

Coal Energy 5600Kcal

OB Depth 60m

Coal Thickness 5m

Coal Ash 2%


Coal Energy 5600kcal

OB Depth 30m

Coal Thickness 5m

Coal Ash 15%




OCTOBER 09

Strip Ratio

OB Depth 30m

Coal Thickness 5m

Coal Ash 2%


Strip Ratio = 30/(5*1.30)

= 4.6bcm/t

OB Depth 60m

Coal Thickness 5m

Coal Ash 2%



= 9.2bcm/t

OB Depth 30m

Coal Thickness 5m

Coal Ash 15%



= 4.3bcm/t

)_*_(

__

DensityCoalVolumeCoal

VolumeOverburdenRatioStrip


OCTOBER 09

Strip Ratio

• Easy but very simplistic

• No Account of Coal Quality

• No account of costs

• No Account of Revenue

• Complex in multi Seam Steep Dip

• Difficult to account for Pit Batters


OCTOBER 09

Cash Margin Ranking

• Cash Margin = Revenue - Costs

• Accounts for complexity of variables (e.g. additional trucks with depth; variations in quality)

• In our example

• Sale Value for 5600 kcal coal = $US16

• Sale Value for 4600 kcal Coal = $US10

• Waste Mining Cost $1.50/bcm

• Coal Mining including overheads $2.50/t


OCTOBER 09

Simple Example Deposit

OB Depth 30m

Coal Thickness 5m

Coal Ash 2%


Coal Energy 5600Kcal

Sale Value = 5*1.30*16

= $104

Costs = 30 *1.50 + 5*1.30*2.50

= $61.25

Cash Margin = 104 – 61.25

= $42.75

OB Depth 60m

Coal Thickness 5m

Coal Ash 2%




= $104

Costs = 60 *1.50 + 5*1.30*2.50

= $106.25

Cash Margin = 104 – 106.25

= -$2.25

OB Depth 30m

Coal Thickness 5m

Coal Ash 10%




= $65

Costs = 30 *1.50 + 5*1.30*2.50

= $61.25

Cash Margin = 65 – 61.25

= $3.75

CostMiningWasteCostMiningCoaliceSaleCoalDensityCoalVolumeCoalinMCash ____Pr__*_*_arg_


OCTOBER 09

Cash Margin Ranking

• Cash Margin = Revenue - Costs

• Accounts for

• Complexity of variables

• Variations in quality

• Variations in Costs

• What about complex analysis (base for multi-seam? ; limit of highwalls in steep dip?)


OCTOBER 09

Lerch Grossman Pit Optimiser

• Algorithm created in the 1960s

• Common in Metals

• Used in Complex Coal – Indonesia

• KPC

• Adaro


OCTOBER 09

Optimisation Theory

• Fill deposit with valued 3D blocks.

• Costs vary with depth etc

• Revenue varies with grade & yield (recovery) etc


OCTOBER 09

Optimisation Theory

Simple geology one seam

Ore

Topography


OCTOBER 09

Optimisation Theory

Simple geology

Ore

Topography

Cost $3/block

Revenue $20/block


OCTOBER 09

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$3 -$3 $17 -$3 -$3 -$3 -$3 -$3 -$3

-$3 -$3 -$3 $17 -$3 -$3 -$3 -$3 -$3

-$3 -$3 -$3 -$3 $17 -$3 -$3 -$3 -$3

-$3 -$3 -$3 -$3 -$3 $17 -$3 -$3 -$3

-$3 -$3 -$3 -$3 -$3 -$3 $17 -$3 -$3

-$3 -$3 -$3 -$3 -$3 -$3 -$3 $17 -$3

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 $17

Optimisation Theory

Waste mining cost = - $3 Block profit

Air blocks


OCTOBER 09

Optimisation Theory

Step 1: Sum the cells vertically

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4


OCTOBER 09

Optimisation Theory

Maximum value vertical pit

Value = 14+11+8+5+2=$40

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4


OCTOBER 09

Optimisation Theory

Bigger pit has less value

Value = 14+11+8+5+2-1=$39

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4


OCTOBER 09

Optimisation Theory

Smaller pit has less value

Value = 14+11+8+5=$38

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4


OCTOBER 09

Optimisation Theory

But pit is not vertical it is inclined.

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4


OCTOBER 09

Optimisation Theory

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

Assume a 45o slope

Value is $-3+14+11-6-3=$13


OCTOBER 09

Optimisation Theory

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

Assume a 45o slope

Value is $-3 +14 –3 =$8


OCTOBER 09

Optimisation Theory

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

Assume a 45o slope

Value is $-3+14+11+8-9-6-3=$12


OCTOBER 09

Optimisation Theory

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

Optimum pit has maximum value

$12

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$13

$8


OCTOBER 09

Optimisation Theory

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$13

$8

Optimum pit has maximum value

A smaller pit is less profitable

A bigger pit is less profitable.

$12

$13

$8


OCTOBER 09

Optimisation Theory

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$13

$8

Optimum pit is maximum

value pit

$12

$13

$8


OCTOBER 09

Optimisation Theory

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$0 $0 $0 $0 $0 $0 $0 $0 $0

-$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3 -$3

-$6 -$6 $14 -$6 -$6 -$6 -$6 -$6 -$6

-$9 -$9 $11 $11 -$9 -$9 -$9 -$9 -$9

-$12 -$12 $8 $8 $8 -$12 -$12 -$12 -$12

-$15 -$15 $5 $5 $5 $5 -$15 -$15 -$15

-$18 -$18 $2 $2 $2 $2 $2 -$18 -$18

-$21 -$21 -$1 -$1 -$1 -$1 -$1 -$1 -$21

-$24 -$24 -$4 -$4 -$4 -$4 -$4 -$4 -$4

$13

$8

Optimum pit is break even

at its limits

$12

$13

$8


OCTOBER 09

One example


OCTOBER 09

$4 sale price


OCTOBER 09

$6 sale price


OCTOBER 09

$8 sale price


OCTOBER 09

$10 sale price


OCTOBER 09

$12 sale price


OCTOBER 09

$14 sale price


OCTOBER 09

$16 sale price


OCTOBER 09

$18 sale price


OCTOBER 09

$20 sale price


OCTOBER 09

$22 sale price


OCTOBER 09

Sale price & strip ratio

Sale Price & strip ratio

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

$- $5.00 $10.00 $15.00 $20.00 $25.00

Sale Price

Str

ip R

ati

o


OCTOBER 09

Sale price & pit size

Sale Price & pit Size

-

10,000,000

20,000,000

30,000,000

40,000,000

50,000,000

60,000,000

70,000,000

$4 $6 $8 $10 $12 $14 $16 $18 $20 $22

Sale price


OCTOBER 09


-

10,000,000

20,000,000

30,000,000

40,000,000

50,000,000

60,000,000

70,000,000

$4 $6 $8 $10 $12 $14 $16 $18 $20 $22

Sale price

$14

Understand geology


OCTOBER 09


-

10,000,000

20,000,000

30,000,000

40,000,000

50,000,000

60,000,000

70,000,000

$4 $6 $8 $10 $12 $14 $16 $18 $20 $22

Sale price

$14

$16

Understand geology


OCTOBER 09

Pit Optimiser Block Ranking

C 5 -

C 6 -

L 6 -

U 7 -

C 7 -

C 8 -

L 8 -


OCTOBER 09


OCTOBER 09

Shortcoming of LG Optimiser

oCannot consider Blending

oCannot consider Time

oCannot consider practicalities and effects of spoil dumps

Next Generations Tools Exist to

This problem


OCTOBER 09

Summary

oManual Method Essential first step – Really don’t answer the questions

oStrip ratio Simple , easy significant traps

oBlock Ranking Allows complex cost/revenue considerations – Difficult to handle complex geometry

oPit Optimisation Well proven tool for multi seam deposits – not a substitute but an aid for good

engineering


OCTOBER 09

oThank You

Documents

Keith Whitchurch, Pt SMG Consultantssmgc.co.id/wp-content/uploads/2012/10/Company-Presentation-of... · Simple Example Deposit OB Depth 30m Coal Thickness 5m ... Lerch Grossman Pit