Skin Analysis in the Selection of NHanson!, D Hodson” and M Mullins? AnsrRacr fates the meni oemy Tina it stellt ly ‘axinun undsonated eh do isthe terion for optnisaton, Most Inning cepts rete apa rodees he atnam Net Pest ane PVD f the pen asin el acon essed en er cent tis cae, e While it sali does nat oduce the Shuma eh eshte tte ie tte opin prose te ‘tat se of mining foreach hick snot tn. Hesve,the comet Sissount nes cam spl to eter est or reves fr he is The White Sup ies ho asi sles the oma roving best and wost case ming sehedie ay cate NOV ives. Tis te pmdes a ety wide range of posible pis fom Silene cngnese must chee # gle otal pt usaly By we of [restr sclevety dugunedasexpenence rf sar ‘Us of White's scheingsttvire fy cunt with he Pocus sre ellos spe ete, which posses ‘skin analjsis, reyies use of engineering julzenent and will not ise alte a mahennaly exit apna it However wel ‘les af mb kno ears THE PROBLEM OF OPTIMISATION In oder prodhace the opti pit design, a engineer ust fst ckstly define the erieria ty’ which the optimum is to be Ireasaced. Most Titel ig, comps te sccking (0 ‘mime vale to thee shareholders This sstalyschieved hy ‘maximising the Net Present Value (NPV) of the cash flows ising from the sae of metal or concent extracted from the pil However ifthe company derives even fen dowsteath bctiviieg or if it seks to maxinice wiliation of the mines! source, of uses Some measate other than NPY, the engineer tuust ads the pit opimisaton eneris accordingly. The sin alysis technique described below Is appropisely wed 10 traximiae the NPV of the open pit eperatin and may. aot he ‘yplieableinothercireumsaes. [Estimation of a project's NPV requires that tinting of ish iknow 0 tha an appeopriats discount facior reistely iercuces preblem foe ‘pliisaton software Fecase the year ef mining for any block ‘fore or waste wll wot be known unl the mine prodetion has ‘en sohedtled. The Lerens-Grossman algeritm, wich ithe Iss for Whatle 4X ofnssation, reduces «geome elton tathe opin problem aa ete all ining th tougt Hocus simultaeossly, je with no dicount face gph. This usally ests in election ofa final pit tat is Tiger than the ave mui NPY pt Th onde to ceoulte the correct NPV an engineer request ‘row the elative tine difference between Moeks mined Win a ppaticular pit shell This is dependent on the mil and mine fopacties, practeal sak rate (Dewees wale pet yas) aad the fipment that can be practealy operated within # specific ‘eubick. In ps with high marginal tipping ratio andlor eurene 1. IMAGED. 100 Mary Avenue, Wheser: Hl Vie 3150, Ems 2 Senor Magee ~ Mike Developmen, nko, Level 1, 4 Ree ‘Otay. Mchoune Vie 800s, Eons dhadsonehiltoncor ee Sshstit I uncommon have vee ne betcon fist iting of wage and is evens fom oe mild from he Se push back Ie thstere port fo ave a axonably Acura ting chee det rope slet heap bt “The White 4X optimisation cannot roger acount fr the ting of eh ows aad 20 While ports some asistnce To the engineer ia the foen of "bua and “worn ae mie Scho The hest ease schedelessumes hat the was asa with ‘rz rgured in any one year mined tht se yar ti it Tevely theese a fealty aid 90 plus a opnsie view of the pjst NPV The wors cise schodlestumes all benches ae mined in saqence frm top denn and i tsi ene, this fs very pesimisi corr ely sen pret. “The example in Figure |i bse on age copper poo in Chilean shoes the utp spiel bine frm Whe “The “best and wore ease NPV curves provide an ervelpeo pile pls fom which the engineer mu manualy set pina pit te ps 23a 52 nthe cxsnpe: However, fncdy wil high rebel aaer hgh sipping mio — he ample in Fg 1 fis ange of pt ot te oe Woe beat 9f 216 Mi to 1092 Me Engineers have develope aw Sedo wth ket oh al ta ce bie often nt rgoros analyte tecniqucs Eee worse, fs ero on a, bees Tn me akon design died final slopes and emp scaly pi secon f nt rove ‘henmre dtaled mine scale rai et foemaior bacemes sail METHODS OF SELECTING. Unsophisisted users often use the While best ease pit ‘sui de evenue factor 1) whlch represen the epnal pit ‘rly if he discount factor is Yero.or if the eesti ita spy ‘maximise cash fo Mere advanced users often use the naximum value pit ested by tabing the average NPV ofthe best and worst ese ‘With vl even, Some nora vary IN fciqucnd e ite thot se oF TO per com of the dffeence teen est nd ‘worstease vals Some compass prefer fo seta maximum cost of marginal prodection so at tere is always an undiscounted) cash margin ft motal predced frm the Final cut, Tae in equivalent to selecting. pit with revenve factor less than ene. ‘These methods are shown in Figure 2 and it can be seen that the optimal ‘average NPV" pt is pt 37, which contains sone 938 Ne ot mtr HE OPTIMUM PIT WHY DOES FINAL PIT SELECTION MATTER? “Most engineers recognise that the pt desiged atthe fesibity stage fa rely the git tal wil acl be el ca ot chee ‘whieh may Be many yews later wen eccnomic coditins contd he substantially diferent from the preseat. Changes in the understanding «€ the erebody, mel prices, mine an! process eas, ele il lf conspine to roc 4 maak feet fi [ito that oignalyensisaged1X RANSON, DHODSON and M MULLINS Pit By Pit Analysis 00 00 ‘Yous ition) 00 sm 4100) 200 g 3 Teane(aten a = Tyitalhest and wort sce NPV cui, Sore Rules of Thum to Selecing Optimum Fi, | Value (milion) SPSNRRNRVERE Pitshalls Pas 2- Average NPV eres Inthe practcal suse, every engineer stould expect tat the find pt All note that Which wes cteinaly eoneeival. The engineer ismeely making a best estimate en caret information {8 B what ie pit may Hook ike: However. this does not detract fiom the eaginess respensbilty to produce he best NPV case possible under cuent knowledge. Companies and hanks locate Capital projets based en theireuret perception of vale, is ‘itl that a projects are presented inthe best igh, but also a Consistent lvsl of desig quality 30 tho! cepa is allocated reliably tothe best peices, 1 should alo be considered that selection of a fsa pt has luc impact on the expected economic ce reserve I the pit selected Ts markedly iferant ‘on the te opie, 1 an result ess tha optimal selection of mine ad mil expat leading to loss of capital ficiency ant hence to Tover pro vale Pern WA 26-26 Nar 2081 ‘TIE SKIN ANALYSIS TECHNIQUE ‘This simple technique uses the White scheduling soutnes to rodhice reslisie mine production schedules snd hence apply rove accirate discus 4 sash flows The resting NPN ‘ave provides a more eliatle bisis fiom whieh to select the ‘pti pit The techniqne requires selecion of the ual White pit ‘eptisation paranteters~ metal pice, slope angles, nining ad process costs snd the requ mine al mil eapacity fis Figure 5 shows a flowebast of the steps 0 complete th skin analysisas they weld appearin a Potes screen dsp, © MF Levene Grosoman i Shale € $F ine Design Scenario GP osPacrapn i] Worst Case Senoaule Ej westcave sensoue G34 ie. cash Cost (Oatinat 5] Puotacccatosion BE stn anaysis ie 3-Powshat skin nly eh Atte ruming the While 1X pit analysis, appropri pits ao selected t detennne the pushbocks within the fal pit These Should represent practical mining widths a ss for at possible ‘senile the expe Jesen cuba Steg Mae RasingConareeUsieg the Milwa for Selected Ing between pushbucks a While mining schedule is produced. [Us desirable foset the maxima bench snk rate parameter a2 practical ate forthe pitconcemed and to profwcs chalet iva elie view of the operating mine plan If necessary, the seeded pushbicks and mining rate parameters stould be modied to proce a good practical sehedue, Using the rots ~ Cestont Grand Tota Graph option, set of nine tehales is prodced from the perultinate pashhack (0 ‘Scesively larger Fl pis, For example (see Figure 4) i he Selecting Pushbacks [SKIN ANALYSIS IUTHE SELECTION OF FNAL PIE LibTS seleced phaves ave cepresented by its 9, 15, 18,21, 25, 31, 39 ‘with fal pit expected around pt 0, successive schedules are un to diferent fina pts as eos ~9, 15,18, 2, 23, 31 043 Instone of 1 “The ontpt fin the Custom Grand ‘Total Grp rests in + rw NPV curve forth scheduled pits from which the maximum ‘ale pea he selected asin Figure 5. I he Tina pits ger tain expected it may fe necessary to inte a new pric ‘ee pth bac (ey 39 in the example and rerun the exercise fo Farge final pis Bet ase => Can PT] Skin Analysis Fis 5-NPV carey skin nasi‘Skin Analysis: | Pushback Scheduled Compared wih Worst & Beat Cassa | 20 a son | og | | bial a0, IL ae ow! sees JL, fst ° si ic0- Conpansonn NPY cones by diferent ata, ‘A mor time consuming exercte to help refine the pit design ‘sto evaluate only te Bil incerent ass sige pushbaek. THis ‘ll not represen a practical mins pusbback Cue wil eoaten, ‘whether the Fiala" has + poston incremental NPV. ‘example if the est fins! pashkack in the previous example wat {o pit, re run the schedules as follows", 15, 18,21.25, 31 39,5 he 9, 15,18, 21,25, 3, 39,45, $6 anu 0 oa teste alge of the final inetoment “This wil help deterne the ‘auternost pit Hint for detailed pit design Figure 6 shows a conparisen ofthe NPV curves and optimal pis by the various methods deserted, ISSUES In cvder to produce @ relale result, the technique requires proper deflation of sign. parimatare a fer any Witle ‘ntinisaiion run. However, skin analysis also requires. good jdgement in the selection of pe pashbsels ind appropiate Thing eonstals, Tes agement le de part he fmrmal nine cheating Proce, but skin enaljsiaeflectively Things: forvand the we of the scheduling assumptions and Fategates them withthe pit selection proces, Use of Opict introduces a complication to the pit scection process teoanc it often posible to prince» project NPV Ua FR greater tha the “est cae" value eimuted hy 4X. This Io ‘rang pacttiogers to select larger final pis tan would ‘erwise have Fecn dose, 1 is important to realise that Optical usally achieves inoreasod als by deferring lower grade ore fom cary [ruiuton yeas (Ma stocplles) so that higher grade eve can be rll coir in the ine Hie Wie very rare to fn siniictt ‘ppertuity to incase value by increasing he eutotTgrale i the final pt phase because a well conceived mine schedule will ot dehy taining of igh grade ore fo the final phar sales practical mining constrain diewte Ako, hee the NPV Ampect over the renining life of he ne is mio het iil inceative (© ise cut-off grades inthe fina) phase. 1s recommended thot final pit selection is we fofore axing Opret to impeove the eich low penile and hence Optictt should wot fave an impact on theseleetion of he fal pit tell CONCLUSIONS Skin analysis provides a methodical process, which leads 10 a sumeneally actuate selection of an atiaate pt thats vali for the design jorameters chosen, It is superior the gonnlly used fulesofthumh because it automatically adjusts to suit the arisulsr depest-geemetry and ines infe ‘account practice, Fhting parameters 50 tx realise discount rate can be applied tothe Bcks mined Nevoshelos the tachnique dacs nat produce rigors cptimise pit andi dees require proper enpincering julgemnert 48 prduce's rable, ner optim sclution REFERENCE, evs, Hal Glosman, L196. Optimum deson ot open Sublet oming Catone