Simulation-based decision-making system for optimal mine production plan selection

Jyrki Savolainen, Ramin Rakhsha, Richard Durham

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)

Abstract

Price uncertainty is one of the major uncertainties in the life of mine (LOM) planning process which can have a decisive effect on the overall profitability. Today’s mine planning software tools provide block-sequencing optimisation for a given static price assumption that is then used as a basis of managerial decision-making process. This paper proposes a complementary approach to this by introducing a simulation-based decision-making tool that, with the help of simulation, seeks for the optimal mine plan when a managerially estimated price development with minimum and maximum boundaries is used as a data input for the given period. To demonstrate the approach, a realistic gold mine case study is presented with five alternative and technically feasible mine plans calculated in a static optimiser from a commercial mine planning software package. These mine planning scenarios are then subjected to price uncertainty in simulation with and without a price trend assumption to highlight the effect of price on the mine’s expected performance. Based on the results, we derive and demonstrate a simulation-based system that automates the matching of optimal mine plan with the managerial insight of long-term price development.

Original languageEnglish
Pages (from-to)267-281
Number of pages15
JournalMineral Economics
Volume35
Issue number2
DOIs
Publication statusPublished - Jun 2022

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