Title: Taking strategic mine planning to a new level

Sub-title: BHP Billiton’s Blazor optimization software has saved the company hundreds of millions of dollars.

 

Mining experts have long struggled to find the best way to optimize resource sites. Over the years, attempts to match mining operations with a company’s strategic objectives have led to the emergence of a new discipline: strategic mine planning. Last month, Peter Stone, Manager, Optimization R&D, at BHP Billiton’s Resource Optimization group in Melbourne Australia, a world leader in the field, gave a talk at McGill University’s Department of Mining and Materials Engineering about some of the company’s latest successes.

 

“The long lead times and large upfront investments that mining companies face to generate cash flows, coupled with the uncertainty regarding the definition of resource bodies, make strategic mine planning particular challenging,” says Stone. “New technologies have delivered significant improvements in mining productivity during recent years. These include maximizing metal recoveries, lowering extraction costs and boosting safety. But there had been a bit of a lag on the optimization side; there was no best way to balance constraints such as where best in the ore body to start digging, how to best structure a pit, how to eliminate bottlenecks and how to maximize the discounted value of the overall asset.”

 

Primacy of the Optimized Extraction Schedule (OES)

According to Stone, many planning steps are routine in nature for most ore bodies. These include estimating the pit’s ultimate footprint, defining the ore body, cut off grades and waste, determining the mine’s optimal life, matting out the size and configuration of required handling and processing infrastructure and estimating market demand for the extracted resource.

 

However there are several problems with what Stone calls the “classical approach” to mine planning. These include the fact that shell topology is difficult to mine, because pit shells often contain gaps. Furthermore according to Stone, existing mine planning software tools such as Lerch Grossman and the C-Plex scheduling engine lack flexibility in specific situations.

 

As a result, according to Stone, BHP Billiton favors what he calls “a new way,” that prioritizes an Optimized Extraction  Schedule (OES),” that balances key mine development limitation factors. For example among the factors that Blazor considered when constraining the optimization of multi-pit development plans at BHP Billiton’s Yandi operation were respecting maximum stopes and mining rates, the capacity of downstream supply chain infrastructure and market tonnage, blended ore quality and grade constraints.

 

Blasor: A new in-house software

When Stone initially got into the strategic mine planning some ten years ago, he and his team knew practically nothing about the field. One particularly valuable tool that BHP Billiton staff have benefited from is the company’s proprietary Blaser mine planning optimization software, which company officials believe is the only such tool, specifically designed to optimize a company life-of-mine development plans.

 

Of course mine planning software has been around for some time. But according to Stone “Commercially available tools were not able to properly value blended ore in the design of ultimate pits and the planner usually has to resort to making arbitrary judgments on in-ground block value to obtain reasonable pit boundaries.”

 

BHP Billiton developed Blaser, a PC-based integrated stand alone software package for its Yandi Joint Venture operation in the iron ore-rich Pilbara region of Western Australia, in-house. “The software’s ultimate objectives are to determine the boundaries of the ultimate pits and the best phase designs for those pits so as to maximize cash flow over the life of the operation,” said Stone. “Blaser’s value lies in its ability to use detailed information about the range of resource grades, to value the blocks more fairly, so that we can make better informed decisions about how to proceed.”

 

“A mine is a bit like an iceberg,” explains Stone. “What you see at first is only a partial indication of what it really out there. “Blasor optimizes tasks by aggregating blocks to take into account geo-technical slope constraints. It helps to determine which material to dig up and then when and where to send it.  The software also helps with the pit design task, by translating the preferred block extraction sequence into a mining phase schedule.”

 

According to Stone, Blasor, is specifically configured for multi-pit blended-ore operations. By most accounts, the software, which also ensures optimization of all market tonnage, grade and impurity constraints, has been a clear success. “Efficiencies generated Blaser have increased an ore body’s net present value by as much as 8% and often much more than that,” said Stone. That comment has been echoed by BHP Billiton staff, which told one Morgan Stanley analyst that the software has found and saved the company close to $500 million.

 

A highly functional utility

Blasor and the updated Blasor CS software, both function fairly intuitively. Planning staff enter in optimization parameters through a functional graphical user interface, after which intermediate data, including all block attributes calculated or assigned by Blasor can be rapidly viewed in a dedicated 3D visualization tool. Other output data, such as full tonnage movements and financial information are then reported via a number of specialized automatically generated databases. The software also includes a 2D graphical display tool that can rapidly show users scheduled data on both an area and pit-wise basis.

 

 

 

Peter@peterdiekmeyer.com

 

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