Block Valuation at Antamina Mine

Block Valuation at Antamina Mine

Mining Software

Summary
Antamina is probably the largest polymetallic mine in the world. There are 16 rocktypes
with varying mill throughput rates. Nine major oretypes are demarcated and campaigned
through a concentrator with a nominal capacity of 30 Mtpy. There are five saleable
concentrates.
Working together, AMEC and C.M. Antamina have developed a block valuation system
that is used for resource modeling and ore control. This system has about a dozen input
grade and density variables which are used to classify blocks as to metallurgical oretypes.
A set of 350 grade-recovery equations are used in 11 subroutines to calculate tonnages
and concentrate grades for seven payable and penalty elements distributed across the five
concentrates. Because the mill throughput is variable according to rocktype, the blocks are
valued according to net revenue per concentrator operating hour. Blocks are valued for all
nine oretypes because day-to-day ore control routing may necessitate blending isolated
blocks into polygons with a different oretype.
The system comprises 9,600 lines of Fortran 90 code and is attached to MineSight® as
a user subroutine. A parallel check can be done with detailed dumps of intermediate
calculations via spreadsheets.
Introduction
Antamina Mine
Antamina is a skarn-hosted copper-zinc-molybdenum-silver deposit located in the
Andes of Northern Peru. The geological setting has been described by Love, et. al. (2004)
and Lipten and Smith (2005). Mining operations commenced in 2001. The mine and
processing facilities consist of an open-pit, concentrator, slurry pipeline, and port. From a
metallurgical viewpoint, Antamina is perhaps the most complex large-scale metaliferrous
operation in the world:
• There are 16 rocktypes of varying degrees of hardness.
• There are 9 oretypes. These are campaigned through the concentrator. Each
campaign lasts from a few days to two weeks.
• Throughput varies by oretype and rocktype, and can range from 50 ktpd to 100 ktpd.
• There are five saleable concentrates produced.
• 2005 payable metals production included 361,000 t of copper; 156,000 t of zinc; 6,720 t
of molybdenum; 409 t of lead; and 9.80 million oz. of silver.
Table 1 lists the salient characteristics for each oretype. Table 2 lists payable and penalty
metals applicable to each concentrate.
Table 1 - Salient Characteristics of Antamina Oretypes

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Table 2 - Payable and Penalty Metals

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(1) Blended so no penalty incurred.

(2) Not assayed in ore; calculated as function of Cu in Cu concentrate, Bi in Pb concentrate.

Block Valuation
All economic criteria presented have been subjected to a random adjustment to preserve
confidentiality of the actual values.
There are two block models: 1) Resource Model, and 2) Ore Control Model. These contain
interpolated grades for seven metals: copper, zinc, molybdenum, lead, silver, bismuth, and
arsenic. The grades of the metals and other information are processed to determine: 1) the
oretype, 2) metallurgical recovery, concentrate grade and tonnage, and 3) block values.
The block values are used to classify the blocks as ore (three economic bins) or waste (four
types). Valuation is done on the Resource Model for input to long-range planning and
reserve definition. Valuation is done on the Ore Control model for use in determining ore
and waste polygons.
Until 2005, the mine used a net smelter return (NSR) cutoff ($/t of ore) to classify ore and
waste. This metric considers only payments to the mine made by purchasers of concentrates.
No costs other than ocean freight are deducted. The operating costs on the mine were
considered in setting an operating cutoff NSR of $11.5/t; however, this was with minor
exception the same for all oretypes. By 2005 the following was recognized:
• There were considerable fixed costs associated with the concentrator and general and
administrative activities (see Table 3A). These can be allocated by oretype/rocktype
(see Table 3B).
• Because the throughput varied by oretype and rocktype, the apparent breakeven
NSR also varies by oretype and rocktype (see Table 3C). The $11.5/t operating cutoff
used covered operating costs for all oretypes, but it is clear that this cutoff provided
much less margin (contribution to return on capital employed) for some of the
oretypes.
• The net revenue produced per unit time by the concentrator varies by both NSR,
and oretype/rocktype (see Table 3D). Figure 1 shows a comparison between net
value per hour and NSR for the M1 and M4 oretypes. The slope of the graph is much
steeper for M1 than M4A. Clearly the mine will make about $50,000/hr for an M1
ore with an NSR of $20 versus $32,000/hr for an M4A ore with an NSR of $20. The
mine will receive a higher return per time period on invested capital if it processes
M1 ore in preference to M4A ore, even though the NSR is the same. Viewed on a
tonnage basis, MP ore having a $20/t NSR has 78% of the value of M1 ore with the
same NSR. However on a net revenue/hr basis, the MP ore will generate only 40% of
the value generated by M1 ore.
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Mining Software
Table 3 - Considerations for Block Valuation, Example for Café Endoskarn

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Figure 1 - Comparison Between Net Value/hr and NSR for M1 and M4A Oretypes

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In May 2005, for long-range planning, and in June 2006, for daily Ore Control, the mine
established an operating cutoff of $14,000/hr on net revenue generated. Material with lesser
value is stockpiled. Table 3E shows the approximate equivalent NSR for each oretype that
would generate $14,000/hr in net revenue. The required NSR for the M4, M4A, M5, M6, and
MP ores is substantially higher than for M1 ore.
Development of the Block Valuation Program
Until 2005, block valuation was done on an NSR basis using Fortran and Visual Basic
programs. These incorporated assumptions as to metallurgical recoveries and concentrate
grades made at the time of the 1998 feasibility study that were based on pre-production
metallurgical testwork. Because mine operating costs are excluded from the NSR
calculation, the effect of variable concentrator throughput on revenue generation was not
considered.
In 2005, the Mine Manager, Dan Gurtler, suggested the mine switch to net revenue/
hour as a metric to be used to drive long-range planning. This required consideration of
mine operating costs in block valuation. At the same time, the Geological Superintendent,
Eric Lipten, was concerned that oretyping was too simplified to be useful for planning. In
particular high and low variants of the nine oretypes by arsenic, molybdenum and oxidation
state should be identified. The Concentrator Manager, Chris Deckert, and his Senior
Metallurgist, Ed Rybinski, had four years of daily operating data with which to develop
much more accurate equations to partition the seven key payable and penalty metals
amongst the five saleable concentrates. The equations were supplied and programmed.
Finally, the mining, concentrator, pipeline, and port and ocean freight costs were assembled
by Senior Mining Engineer, Eric Dell. Updated smelter contacts were obtained from Mr.
Shinichiro Furukawa of the Marketing and Finance Department.
A set of three prototype programs was written by Dr. Harry M. Parker in April/May
2005 to perform oretyping, to evaluate metallurgical equations, and to value blocks. These
programs were designed to be used on an occasional basis to support long-range mine
planning. They read from and wrote to voluminous ASCII files.
In October 2005, the mine requested the assistance of AMEC in developing a system
which could be used to apply block valuation for Ore Control on a daily basis, as well as for 24th
long-range planning. This system differs from the prototype in the following respects: Annual
• Blocks and blastholes are evaluated. Mintec
• Material typing, which involves consideration of oretype and economic value Seminar
(binning) is performed.
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• Data are retrieved from the block model, and output variables are written to
the block model using a MineSight® user subroutine, which in turn calls other
subroutines. MineSight® is a geological and grade modeling software system
developed by Mintec, Inc. of Tucson Arizona, USA.
Mining Software
The remainder of this paper describes the system. It is believed to be the
largest and most complex of its type in existence. Fortran source code, including
comment lines, totals 9,600 lines.

Design Considerations
The Four Main Options
Early concepts of the valuation program called for separate programs to perform
oretyping and block valuation. This would require extensive intermediate input/output to
the MineSight® project database or other files. Further, various data sources and customers
were identified that would likely provide data to arrive at value per hour determinations
or utilize some but not all output variables. Separate programs that require duplication
of the same, or similar subroutines, can be difficult to maintain. Separate programs and
subroutines could result in “code creep” over time as updates and revisions are made.
It was decided to write a single program with one set of subroutines that would process
grade and metallurgical data from the four main data sources that were identified. Table 4
provides a summary of the valuation performed by each option.
Table 4 - Capabilities of Four Main Options

Notes: - Indicates metallurgical oretype identified, but no specific output variable with value for the
metallurgical oretype
* Indicates temporary economic parameters can be used in a second run to overwrite most output fields,
but values for metallurgical oretype from first run using permanent economic parameters are saved.
+ One economic parameter file is used, permanent or temporary; all output variables from previous
runs are overwritten.
Brief descriptions of the options are provided below:
1. Block Valuation, or BLKVAL. This step is a first pass evaluation which assigns
optimal ore and waste types, and value per hour for the nine possible mill
campaigns. This option is invoked for the Ore Control model to display optimal
routing to assist in dig-line construction. In this option the metallurgical oretype
is the ideal oretype, and its value is identified. Sometimes because of lower than
normal penalties or higher than normal byproduct credits, another oretype may have
the maximum ore value per hour. This oretype and its value are identified. There is
provision to value the block first using permanent economic parameters, and also in
a second run using a temporary set of economic parameters (related to short-term
price fluctuations). The values related to the permanent economic parameters for the
metallurgical oretype remain stored.
2. Polygon Valuation, or PROUTE. This application updates the Ore Control block
model. Once a routing choice has been nominated for a group of model blocks,
24th the program calculates concentrate tonnages and grades, applicable penalties and
Annual credits. This option is necessary since Ore Control polygons often contain a minority
Mintec of blocks that are included within an ore cut that have sub-optimal routing. The
Seminar PROUTE option calculates ore value and metallurgical parameters given a user-
nominated oretype. Normally this option would use permanent economic
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parameters, but temporary economic parameters could be used. Values

are only stored for the set of parameters that are run.
3. Blastholes. Grades are extracted from an acQuire™ database and
processed by the program in the same way as block grades. This option
uses ASCII files passed from, and back to the acQuire™ database rather Mining Software
than directly accessing a MineSight® model file. Metallurgical ore and
waste typing, and value per hour for all nine oretypes are calculated and stored back
to acQuire™. These data are then available to be displayed in blasthole views in
the MineSight® environment. Normally this option would use permanent economic
parameters, but temporary economic parameters could be used. Values are only
stored for the set of parameters that are run.
4. Resource Model Valuation. The Resource Model is processed assuming a selective
mining unit which is the same as the model block size. Each block is processed
directly with its metallurgical ore type. Several concentrate tonnage and grade items
were added for this option to characterize the five possible concentrates produced
from the long-term resource model. Normally this option would use permanent
economic parameters, but temporary economic parameters could be used. Values are
only stored for the set of parameters that are run. Ore and waste values can be easily
evaluated under various economic scenarios; then values for a selected case can be
pre-processed for a pit-optimization run in other software.
If changes are made to metallurgical parameters, recoveries, economic parameters,
costs etc., then those changes are applied globally regardless of which of the four options
are invoked or how many times various subroutines are called. Having a fully integrated
valuation program greatly reduces the risk of maintaining separate systems specialized for
different tasks. The four main tasks listed above are specified though the MineSight® runfile
by use of an IOP or a user specified input/output parameter. The main program which
processes the data then takes a different path, but calls the same set of subroutines within
the valuation program. Flexibility is still available to the user by allowing the use of drive
files and parameter files which specify how the blocks or blastholes are treated.
Program Structure
Figure 2 shows a summary flowchart of the system for Options 1, 2, and 4. These
options interact with either Ore Control or Resource block models stored in MineSight®
model databases. The flowchart for Option 3 is slightly different because blasthole data
are contained in an acQuire™ database. The flowchart has been omitted because of space
limitations.

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Figure 2 - Flowchart for Options 1, 2, 4

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Note: Auxillary files have been omitted in the interest of clarity.

The main files are:

Input
1. MineSight® Project Database: Grade, rocktype, density data. Table 5 shows the
input data.
2. User612 Process Run File: contains input and output variables in the database.
3. Drive File: contains subroutine system control parameters and file names.
4. Ore/Waste Parameter File: contains ore/waste type definition criteria.
Table 5 – Input Data

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undefined it is set to 20 (Café Endoskarn).
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Available Copper and Available zinc do not occur in blasthole file; are calculated in program.
Seminar Density must be from 0 to 5; if out of range assigned 2.79; for Option 3, program assigns 2.79.
Release Codes must be 1 to 10; if a release code is 2, under Option 2 the block will not be processed.
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5. Metallurgical Parameter File: contains metallurgical recovery and

concentrate grade equations for Cu, Zn, Mo, Ag, Bi, Pb, As in copper,
zinc, molybdenum, and lead concentrates. The copper concentrate
may be chalcopyrite or bornite dominant, depending on oretype. The
metallurgical equations are discussed in the appendix. Mining Software
6. Economic Parameter File: contains economic parameters for mining,
process, transport costs, metals prices, smelter schedules, etc.
Output
1. MineSight® Project Database: Block values, metallurgical oretype, oretype with
highest value/hr, As and Bi penalties, final routed oretype. Output is customized for
each option. Table 6 shows the output data. Main options 1 and 3 permit comparison
of block values for each oretype for each block. The oretype with maximum value/
hr may sometimes differ from the metallurgical oretype specified in Table 1. This is
related to byproduct credits and/or penalties. At Antamina, molybdenum is usually
recovered at the expense of a bismuth penalty. However, it is possible to redirect the
molybdenum circuit to remove bismuth. Hence the molybdenum credit – bismuth
penalty can be a useful Ore Control variable. For Options 2 and 4, concentrate
tonnages and grades are output. These can be used to make concentrate production/
sales forecasts.
2. Report File: lists file names and run options.
Table 6 – Output Data

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Note: - indicates variable written to output file for Option 3, but not loaded to acQuire™ database.
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Auxiliary Files
Debug and message files are created covering data entry checks, oretyping,
metallurgical recovery and concentrate grades, block valuation, and output
variables. These files contain varying levels of dumps of input, intermediate
Mining Software and output variables.
Comments
The drive file and report files reside in the same directory as the MineSight® Project. These
are under user control. The user subroutine makes extensive checks of the input data and
parameters for consistency. Problems are recorded in the report file and various debug/
message files. It is the user’s responsibility to check these files for any reported anomalies.
The ore/waste, metallurgical, and economic parameter files are stored in a secure
directory and cannot be modified by the user. These files contain expiration dates, beyond
which they cannot be used without being reset by authorized personnel. The files have a
.csv format, indicating they can be created/modified using Microsoft® Excel spreadsheets.
The files contain keyfield delimiters and comments as to input parameters required. In some
cases, parameters must be entered in a specified order. In general the drive and parameter
files will be infrequently changed. Therefore no provision was made for developing
graphical user interfaces to build the files. The ability to build the files inside Microsoft®
Excel spreadsheets makes them easy to prepare and maintain.
The overall responsibility of collating, reviewing, and updating the input parameters for
the oretyping and valuation system rests primarily with the Engineering Superintendent,
with input by the Geology Superintendent, Senior Geologist, Senior Metallurgist, and
Senior Long-range Planning Engineer and various staff from the Finance and Marketing
department. Prior to revised parameters being implemented, review and signoff by the
Mine Manager is necessary.
Some of the auxiliary files serve as input to spreadsheet checking. These checks were
exhaustive and replicated virtually all aspects of the program.
A check dataset has been embedded on the bottom bench of the Ore Control MineSight®
project database. Procedures have been developed to permit running this dataset under
Options 1 and 2 (refer to Table 4) and to provide check dumps that can be compared against
previously generated spreadsheets. This serves as an easy way for the user to validate the
integrity of the system and its files going forward.
The system has limited capacity to use two economic valuation parameter files to perform
evaluations using permanent and temporary economic parameters. The default is to use
the permanent file, and the output variables are written into the permanent and temporary
values. In a subsequent run, the temporary economic parameters can be used to reset the
temporary output variables.
Conclusions and Acknowledgement
The system has been working since June 2006 with no apparent problems. The authors
would like to thank Compañía Minera Antamina for permission to publish this paper.
References
Lipten, E. J. and Smith, S. W., 2005, The geology of the Antamina copper-zinc deposit, Peru,
South America, in Porter, T.M. ed., Super Porphyry and Gold Deposits a Global Perspective,
1st ed. vol. 1, pp. 189-204, PGC Publishing, 6 Betty Street, Linden Park, SA, 5065 Australia.
Love, D. A., Clark, A. H., and Glover, K. J., 2004, The Antamina deposit, Ancash, Peru: The
24th stratigraphic and structural setting of a giant copper-zinc skarn, Economic Geology, v. 99,
Annual pp. 887-916.
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Appendix – Metallurgical Equations

For the main metals in their concentrates, the recovery and concentrate grade
are independently specified:
Rec = r= a + b(x) Mining Software
Where a and b are constants and x is the main metal
Grade = g = c + d(x)
Where c and d are constants and x is the main metal
In some cases only the constant (y intercept) is specified.
The tonnage of concentrate per tonne of ore t can be calculated by balancing the metal.
(x)(r)/100 = (t)(g)
Since recovery is expressed in %. We can solve for t:
(t) = (x)(0.01)(r)/(g)]
Where we are to calculate the concentrate recovery r’ and grade s for another metal in the
same concentrate, the concentrate grade s and recovery r’ are no longer independent. For
example suppose we can predict the recovery r’ of metal y from an equation. Then:
(y)(0.01)(r’) = (t)(s) = {(x)(0.01)(r)/(g)}(s)
s = [(y)(r’)(g)]/[(x)(r)] or
s = [(y)(0.01)(r’)/t] Standard equation (1)
Alternatively, suppose we can predict the grades from an equation. Then we can derive the
recovery:
r’ = (x)(r)(s)/[(y)(g)]
r’ = (s)(t)(100)/y Standard equation (2)
These have been referred to as standard equations. Custom-equations that predict grade or
recovery:
r’ = a + b(x)
s = c + d(y)
are referred to as non standard equations.

To preserve mass, a metallurgical bin can have exactly one standard equation and exactly
one non‑standard equation.
In the subroutines the non-standard equation is used first and then the non standard
equation. Within the same subroutines the non standard equations may be used to calculate
concentrate grade for some bins and concentrate recovery for other bins.
The subroutines are executed in such a way that the concentrate grades and recoveries
for the principal metals are calculated first before they are needed for the subroutines that
determine concentrate grades and recoveries for subordinate metals.
There were many problems developing equations for the subordinate metals that resulted
in reasonable recoveries and grades. Some of the subroutines use side conditions to restrict
the span of the bins.

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 Block Valuation at Antamina Mine

Harry M. Parker and Kim M. Kirkland

AMEC E&C Services Inc.
780 Vista Blvd No 100.
Sparks, Nevada 89434 USA
Mining Software

Harry.parker@amec.com 1 650 504 0229

Kim.kirkland@amec.com 1 602 820 1410

Dan Gurtler, Eric J. Lipten, Arndt Brettschneider, and Paul Gomez

Compañía Minera Antamina S.A.
Av. La Floresta 497 – 4° Piso
Urb. Chacarilla Lima 41, Peru
dgurtler@antamina.com 51 1 217 3724
elipten@antamina.com 51 1 217 3769
abrettschneider@antamina.com 51 1 217 3745
pgomez@antamina.com 51 1 217 3703

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