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Block Cave Production Planning Using Operation Research Tools

Planificacin de la Produccin Utilizando Herramientas de


Investigacin Operativa en iner!a de Hundimiento por Blo"ues#
$nri"ue Ru%io
PhD candidate, University of British Columbia
Mining consultant, Gemcom Software International
Ton& 'iering
Princial consultant, Gemcom Software International
Abstract
In the as, manual methods have been used to lan and schedule the e!traction of ore from different bloc" cave
oerations worldwide# $he basic assumtion of these methods has been the validity of a set of heuristics,
traditionally, used to lan and schedule roduction coming out of an active anel# Currently, however, there are
several oerations research tools %reviously used in the manufacturing sector& that could be used in bloc" cave
mine lanning# $his aer describes the alication of mathematical rogramming to formulate otimi'ation
roblems whose solution may erhas drive the roduction strategy of a bloc" cave mine# Some of these strategies
such as net resent value otimi'ation, draw rofile otimi'ation and minimi'ation of long ( short term ga have
been formulated#
$he construction of the otimi'ation roblems has re)uired a rational study of which mining constraints are
alicable in each case# In doing so it has been found that the formulation of the ob*ective function as well as the
set of constraints that define the feasible sace of solutions are both critical to effective mine lanning solutions#
+t the moment the full scale algorithms have been incororated into the PC,BC bloc" caving commercial ac"age#
-ne of the results of this research has been the integration of the oortunity cost into PC,BC to comute best
height of draw in a dynamic manner# $he second result has been the develoment of draw method called .P/
which ma!imi'es the net earnings er eriod# +nother result has been the introduction of a new draw method
called SU01, which aims to minimi'e the difference between actual height of draw and the target reresented by a
surface#
Different mathematical techni)ues have been used to solve the otimi'ation roblems such as direct iterative
methods, linear rogramming, golden section search techni)ue and integer rogramming# $he results of alying
otimi'ation to different oerations worldwide will be resented and outlined in this aer# 1inally a discussion
about the role of otimi'ation in bloc" caving will be resented
1 INTRODUCTION
The planning of a %lock cave mine poses
considera%le difficulties in the areas of safet&(
environment( ground control and production
scheduling# )s the industr& is faced *ith more
marginal resources( it is %ecoming imperative to
generate production schedules *hich *ill provide
optimal operating strategies and make the
industr& more competitive +Chanda( ,--./#
Production scheduling of an& mining s&stem
has a profound effect on the economics of the
operation# In a marginal deposit the application
of the correct scheduling mechanism might affect
the life of the mine# Usuall& the scheduling
pro%lems are comple0 due to the nature and
variet& of the constraints acting upon the s&stem
+'en%&( ,--1/# )lthough several authors such as
Caccetta and 2iannini +,-33/( 4ilke et al +,-31/(
2ershon +,-35/ have attempted to develop
methodologies to optimize production schedules(
none has satisfactoril& produced a ro%ust
techni"ue *hich has an accepta%le level of
success# One of the main reasons for this
unsuccessful histor& has %een the failure in
defining the o%6ective function in relation to the
mine planning horizons#
In this research t*o main planning strategies
*ill %e formulated as potential goals to %e
optimised as part of the long term planning
process# The first one is the ma0imization of net
present value( *hich has %een a traditional
interest of mining companies to optimise in such
a *a& that all the mining( metallurgic and
environmental constraints are fulfilled# The
second strateg& developed in this research is
ma0imization of mine life( *hich often has %een
associated *ith a societal goal to maintain
emplo&ment levels#
2 OPERATIONS RESEARCH IN
PRODUCTION SCHEDULING
The pro%lem of computing a production
schedule in an underground mine can %e
understood as an operations research pro%lem in
*hich there is an o%6ective function su%6ect to
operational constraints# Trout in ,--1 developed
a model to optimize the c&cle time of the unit
operations related to a long7hole mining method#
)lso Chanda in ,--. developed a model to
optimize production from a slusher %lock cave
method using scrapers as production machines#
Both of these authors concentrated on a short
term planning pro%lems that cover a time horizon
of a fe* *eeks to a fe* months# 8either of these
algorithms have recognized the fact that the set of
constraints is a function of the planning horizon
under stud&( for e0ample( a long term production
schedule should contain much less detail than a
short term plan# Ho*ever the long term plan
includes clear definitions related to mining
reserves( production se"uence( and production
rate# ore sophisticated algorithms have %een
developed %& 2uest +9.../ and atthe*s +9..,/
to anal&se and compute long term plans# 2uest in
9... postulated that %& follo*ing a set of
surfaces that conceptuall& define a dra* control
strateg& dilution can %e minimized and therefore
8P: ma0imized# atthe* also presented an
algorithm *hich could %e used to define the
optimum opening and closure se"uence in a cut
an fill mine# Both of these algorithms recognized
the fact that %& using integer varia%les in their
formulation the computation time often is
inade"uate# )lso %oth authors descri%ed that the
solution for the computing time is rela0ing the
integer varia%le to reach a feasi%le solution in a
reasona%le time# It has %een proven +Terlak&(
,--;/ that %& rela0ing the integer varia%les in a
mi0ed integer algorithm the optimum solution
can differ dangerousl& from the solution provided
%& the optimizer#
One of the pro%lems found in the current
literature is that there has %een ver& little anal&sis
of the ade"uate set of constraints applica%le for
different planning horizons# )lso none of these
algorithms have sho*n a case stud& in *hich a
large scale model had %een computed#
Before stating the mathematical pro%lem of
computing a production schedule in a %lock cave
mine( it is important to descri%e the operational
constraints applica%le to %lock cave as a mining
method( the follo*ing list presented %& Ru%io(
9... summarizes a fe* of them<
Development rate states the ma0imum
feasi%le num%er of dra* points to %e opened at
an& given time *ithin the schedule horizon# This
constraint is usuall& %ased on the geometr& and
geotechnics of the ore %od& and the e0istent
infrastructure of the mine( *hich t&picall& *ill
define the num%er of accesses availa%le to the
mining faces
Undercut sequence defines the order in
*hich the dra* points *ill %e open# This
constraint usuall& acts on the dra* point status
activating those that are at the front of the
production face# This component assumes that
the la&out has %een previousl& computed and it is
fi0ed in the optimization#
Maximum opened production area at an&
given time *ithin the production schedule has to
%e constrained according to the size of the ore
%od&( availa%le infrastructure and e"uipment
availa%ilit&# ) large num%er of active dra* points
might lead into serious operational pro%lems such
as e0ceeding optimum haulage distance or
pro%lematic maintenance of dra* points#
Draw rate= the dra* rate *ill control flo*
of muck at the dra* point# The dra* ratio is a
function of the fragmentation and the cavea%ilit&
model# Ultimatel& the dra* ratio *ill define the
capacit& of the dra* point and it needs to %e fast
enough to avoid compaction and slo* enough to
avoid air gaps#
Draw ratio defines a temporaril&
relationship in tonnage %et*een one dra* point
and its neigh%ors# It is %elieved that this
parameter *ill control the dilution entr& point and
the damage of the production level due to induced
stresses#
Period Constraints= the period constraints
forces the mining s&stem to produce the desired
production usuall& keeping it *ithin a range that
allo*s fle0i%ilit& for potential operational
variations#
8ote that in this formulation mining reserves
are not part of the set of constraints# This %reaks
the traditional paradigm of computing mining
reserves in advance of computing a production
schedule# In this case the mining reserves *ill %e
computed as a result of the optimal production
schedule#
3 NPV OPTIMIZATION IN BLOCK CAVE
PRODUCTION SCHEDULING
)ccording to the theor& of non rene*a%le
natural resources the pro%lem of optimizing net
present value can %e *ritten as follo*s +Conrad( >
,---/<
?uppose a utilit& function
/ +
t t t t
) C )
(
*here
t
)
is the rate of depletion of the natural
resources in period t,
t

is the spot price of the


underl&ing resource(
/ +
t
) C
is the production
cost as a function of the depletion rate# The
o%6ective is to ma0imize the discounted utilit&
function su%6ect to the limited amount of
resources
.
0
# @etAs call the discount factor
t


*hich is a function of the discount rate and the
period of the depletion to %e discounted#
The pro%lem to solve can %e formulated as
follo*s<
[ ]

'

$
t
t t t t
) C ) Ma!
.
/ +
?u%6ect to the depletion rate
t t t
) 0 0
+,

.
0
given and $ a varia%le in
the optimization
a0imization of the discounted utilit& function
su%6ect to the e0haustion constraint leads to the
@agrangian<
[ ] [ ] { }

+ +
+ +
$
t
t t t t t t t t
0 0 ) ) C ) 2
,
, ,
/ +
+,/
The first order optimalit& condition is presented
%&<
[ ] .
,

+ t ) t t
t
C
)
2

+9/
8ote that )
C
represents the first derivative of
the production cost *ith respect to the depletion
rate in period t# The derivative of the @agrangian
*ith respect to the remaining resources in period
t is presented as follo*s<
[ ]
t t t t t
t
0
2

+ + , ,
.
+B/
Cinall& the derivative *ith respect to the
@agrange constant is as follo*s<
t t t
t
) 0 0
2

+,
.

+1/
B& replacing +B/ on +9/ t ) t
C +
+D/
$"uation +D/ means that the marginal profit
should e"ual the marginal production cost plus a
varia%le cost
t

# This varia%le cost


t

is called
the shado* price of initial reserves( or the value
of having an e0tra initial ton to %e e0tracted
optimall& in period t#
Crom an optimization point of vie*
t


represents the opportunit& cost of depleting a
particular unit of resource in period t instead of
saving it for the ne0t period of production#
In summar& the mining interpretation for
e"uation D is that the result of appl&ing the
marginal cost plus an e0tra EartificialF cost per
period to define the economic outline per period
*ill lead to the strateg& { }
$
t
)
.
that *ill deplete
optimall& the mineral deposit#
In the conte0t of an arithmetic e0ample 2ra&
+,-,1/ *as the first author recognizing an
additional cost to marginal e0traction calling it
opportunit& cost# The second author that
developed a formulation for non rene*a%le
natural resources optimization *as Hotelling(
,-B, *ho introduced the concept of depletion
strateg&# Hotelling stated that the optimum
depletion strateg& is the one that depletes the
natural resources at such a rate that the gro*th of
the rent generated for depleting natural resources
is similar to the rate of return# 8evertheless it
*as @ane in ,-33 *ho first introduced formall& a
methodolog& to compute the opportunit& cost in
mining# @ane postulates that the optimum
strateg& should %e optimal at the *hole resource
depletion path( the optimum strateg& should not
onl& ma0imize the individual cash flo*s %ut also
include the effect of these cash flo*s in the value
of the remaining reserves# The last could %e
summarized in the follo*ing formula +;/#

'

1
]
1


d$
d/
/ t w c Ma!
d0
d/
w
G
G
G
/ ( +
+;/
Crom +;/
G /
represents the ma0imum net
present value for the deposit( 0 is the total
amount of mineral resource to %e depleted(
/ ( + t w c
represents the marginal cash flo* of
depleting one ton of ore in period t follo*ing the
shut off grade *( *ith w %eing part of the overall
optimal depletion strateg&#

is the time to
deplete and process one ton of ore# is the
period discount rate#
d$
d/
G
is the gain or the
loss of depleting one ton of ore in period t upon
varia%le economic and market conditions#
8ote from ; that the optimum marginal reserves
for depletion +left hand side of the e"uation ;/(
*ill %e reached *hen the contri%ution to the
optimal 8P: +
G
/ / of the last ton depleted is
e"ual to zero# Therefore the last ton of ore
depleted in period t should fulfill the follo*ing
relationship<
. / ( +
G
G

1
]
1


d$
d/
/ t w c
+5/
The a%ove formulation has tremendous
implications from the perspective of the
economics of natural resources( %ecause it
provides a mechanism to compute the @angrage
constants presented %efore in e"uation D# Thus
com%ining D and 5<
t
d$
d/
/
1
]
1

G
G
+3/
In summar& the econom& of natural resource
theor& sa&s that the optimum depletion strateg& is
the one that covers the marginal cost plus the
opportunit& cost of depleting the actual resources
instead of leaving them in the ground for the ne0t
depletion period#
One of the pro%lems *ith the a%ove formulation
applied to Block Caving *ould %e to find the set
of shut off grades +shut off grade polic&/ that
leads to an optimum solution# The follo*ing
section *ill sho* ho* the concept of opportunit&
cost has %een implemented in order to derive an
optimum depletion strateg&#
3.1.APPLICATION OF OPPORTUNITY
COST IN BLOCK CAVING PRODUCTION
SCHEDULES
The follo*ing algorithm has %een introduced
into the PC7BC soft*are from 2emcom ?oft*are
International +'iering( 9.../ as part of their
routines to optimize the 8P: of a production
schedule#
Before stating the algorithm used to introduce
the opportunit& cost in the production schedule it
is important to dra* graphicall& all the
constraints related to the production schedule(
figure , sho*s the feasi%le area for one period of
the production schedule#
Figure1: Schematic representation of the feasible
area of production at any given period of the
production schedule
Cigure , the H a0is represents the dollar value
per dra* point( this value is computed %&
integrating verticall& the value of the dra*
column until it declines due to a decrease in the
metal content# The I a0is represents the tonnage
to %e mined per dra* point= this is one of the
optimization varia%les# The chart is divided into
1 areas %& closed dra* points +C/ *hich are dra*
points alread& e0hausted( active dra* points +)/
*hich are dra* points in production( ne* dra*
points +8/ *hich is also an optimization varia%le
and represents ne* dra* points commissioned to
production in the current period and planned dra*
points that are dra* points located ne0t in the
se"uence# )lso all the constraints of the
optimization have %een graphicall& represented to
define the feasi%le area# The solution of the
optimization *ill provide a dra* method
+'iering( 9..1/ that defines the tonnage to %e
dra*n from ever&one of the active and ne* dra*
points# 8ote that the feasi%le area should %e large
enough to contain the dra* method that *ould
fulfill the total tons production target# Other*ise
the pro%lem is considered to %e full& constrained
and su%7optimal solution *ill %e found#
The optimal dra* method *ill %e such that
dra* points containing higher dollar value *ill %e
dra*n more and dra* points *ith lo*er *ill %e
dra*n less or not at all# The dra* points that are
not dra*n in a period are shut do*n moving the
%oundar& +C/( sho*n in figure ,( to the right#
Conse"uentl& the ne0t period in the schedule the
active area *ould %e reduced and more ne* dra*
points *ill %e needed# Thus the chart in figure ,
is re7dra*n for this ne* period and the dra*
method re7computed# This process is repeated
until reaching the end of the life of the mine#
The mechanism to incorporate the opportunit&
cost in the production schedule consists of
computing the dollar value per dra* point in
ever& period of the production schedule# The
dollar value per dra* point calculation *ill %e
used for t*o purposes( the first one *ill shut
do*n those dra* points that do not have enough
remaining value and second *ill %e used to plot
the chart sho*n in figure ,# Conse"uentl& the
active dra* points *ill %e dra*n according to the
dra* method descri%ed a%ove to drive the 8P: to
its ma0imum point#
The algorithm to add the opportunit& cost in the
production schedule is as follo*s<
,# ?et the initial %oundar& conditions
I $MI.
i
i
sets the minimum tonnage to %e
mined per dra* point *ith I dra* points across
the la&out
$ - t . C
.
t

sets the initial value of
opportunit& cost for the time horizon of the
production schedule
9# Incorporate ne* dra* points
t
.ew
according to the given undercut se"uence#
B# Compute dollar value per dra* point
$ .ew +ctive D/
t t
t
i
+ t ( i
# 8ote that
t
i
D/
alread& contains the marginal cost#
If dra* point i contains less value than the
opportunit& cost +
"
t
t
i
-C D/ <
/ and the tonnage
dra*n from dra* point i e0ceeds the minimum
allo*a%le +

i
$MI.
/ then dra* point i is shut
do*n#
Other*ise dra* point i *ill still %e in
production and *ill %e dra*n according to the
dra* method#
If there is an e0tra capacit& the ne*est dra*
points are flagged as idle status# If there is not
enough capacit& the tonnage target constraint is
%roken#
1# 'eplete assigned tonnages from the dra*
column and update the model# Then move to the
ne0t period t3t45( return to 9
)fter computing the production schedule in this
first iteration the opportunit& cost per period is
updated as follo*s<
Compute revenue per period
t t t
d /alue 0 G
*here
t
/alue
is the average
dollar value in period t and
t
d
is the total
tonnage sent to the mill in period t
'evelopment cost per period
DPC n D
t t
G
*here
t
n
is the num%er of ne*
dra* points incorporated and used in period t and
DPC is the construction cost of a dra* point#
Profit per period
t t t
D 0 P
Remaining deposit value per period

$
t "
t "
"
t
P
/
,
/ , +
( *here is the discount
rate per period# 8ote that this value is computed
at ever& period of the production schedule#
Opportunit& cost per period is computed
according e"uation ;
C
/
-C
t
t


( *here C
represents the average mill capacit&# This
e"uation does not integrate the term
dt
d/


%ecause it assumes that the economic conditions
as *ell as the market conditions sta& stead& along
the life of the mine#
Ta%le , sho*s an e0ample of ho* the s&stem
computes one set of opportunit& costs after one
iteration#
n
t
R
t
'
t
P
t
:
t
OC
t
3 2,919,365 360,000 2,559,365 11,576,159 6.32
0 2,921,512 0 2,921,512 9,812,263 5.36
2 2,343,786 240,000 2,103,786 8,689,703 4.75
1 1,451,375 120,000 1,331,375 8,227,298 4.49
0 1,374,377 0 1,374,377 7,675,651 4.19
1 1,375,122 120,000 1,255,122 7,188,094 3.93
1 1,874,756 120,000 1,754,756 6,152,147 3.36
1 2,543,706 120,000 2,423,706 4,343,656 2.37
0 1,892,513 0 1,892,513 2,885,509 1.58
1 1,901,043 120,000 1,781,043 1,393,016 0.76
0 1,294,969 0 1,294,969 237,349 0.13
0 208,914 0 208,914 52,170 0.03
0 57,387 0 57,387 0 0.00
0 0 0 0 0 0.00
0 0 0 0 0 0.00
0.1
DPC 120,000
C 183,050
NPV 12,850,476
Table 1: Opportunity cost calculation after
iterating once the production schedule
$ver& iteration *ould produce a different set of
opportunit& costs per period# Thus
"
t
-C
*ould
represent the opportunit& cost of period t after
iteration "# Calling the optimum iteration '(
'
t
-C
*ould represent the optimum opportunit&
cost polic& that *ould drive the optimum
production strateg&# The total tonnage dra*n per
dra* point *ould represent the optimum mining
reserves# Thus this algorithm integrates the
production schedule and the mining reserves
optimisation in a single algorithm# This result is
fairl& significant considering the fact that
traditionall& these t*o processes are computed
independentl& of each other#
Ultimatel& the a%ove algorithm produces a
varia%le shut off grade polic& that drives the
production schedule to its ma0imum net present
value#
3.2.OPPORTUNITY COST VARYING
ECONOMIC CONDITIONS
In the presented algorithm the term
dt
d/

has
not %een included as the scenario under anal&sis
has %een stead& economic and market conditions#
Ho*ever in the real *orld the metal prices
change as *ell as the suppl& and demand for
metals# Therefore it *ould %e meaningless to
optimize a production schedule *ithout
considering metal price changes# Ho*ever the
pro%lem *ould %e to forecast ho* the prices *ill
%ehave in the future# The follo*ing algorithm
assumes that the vector of metal prices along the
life of the mine is kno*n and is part of the
evaluation varia%les#
Cor e0ample if the market is facing a rise in
metal prices( then it ma& %e more appropriate to
*ait for prices to recover# )lternative( *hile
*aiting for increased prices the deposit is losing
value in dela&ing its operation# Iet there is a
trade off %et*een the incremental value gained %&
economical e0ternal changes and %& opportunit&
cost#
There are a fe* parameters that need to %e
defined to formulate the integration of d$ d/ J
into the optimization algorithm such as<
t
01

is the revenue factor per period#
t
MC
is the mining cost per period including
the processing cost#
t
0
is the revenue earned in period t#
K
t
0 is the revenue that *ould %e earned if the
pro6ect is dela&ed in one period of time# It takes
economic parameters from t45 period#
t
P
is the profit earned in period t#
K
t
P is the profit using
K
t
0 #
t
/
is the remaining value of the mine at the
end of &ear t#
t
6
is the future value of the mine at the end of
&ear t using economic parameters of &ear t45#
t
G
is the head grade simulated %& the
production schedule#
The calculations proceed as follo*s<
+ /
t t t t t
0 d G 01 MC
K
, ,
+ /
t t t t t
0 d G 01 MC
+ +

t t t
D/ 0 P
t t t
D/ 0 P
K K

+
+

$
t "
"
"
t
P
/
,
/ , +

+
+

$
t "
"
"
t
P
6
,
K
/ , +
Then the factor
t t
/ 6
dt
d/

is kno*n and the
opportunit& cost per period can %e computed as
follo*s<
C
dt
d/
/
-C
t
t

Cigure 9 sho*s the effect of Ld:JdT on the


resulting opportunit& costs# 8ote that the
opportunit& cost *ithout incorporating Ld:JdT
does not have an& relation to the revenue factor or
metal price# In contrast( the opportunit& cost
including Ld:JdT has a direct correlation *ith the
revenue factor# Iet the inclusion of
dt
d/

on the
calculation of the opportunit& cost could lead to a
totall& different production schedule and
therefore the set of opportunit& costs that does not
include the term accounting for varia%le
economic conditions *ould drive to a su% optimal
production schedule#
0
2
4
6
8
10
12
14
16
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Period #
R
e
v
e
n
u
e

F
a
c
t
o
r

$
/
%
C
u
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
G
r
a
d
e
-
%
C
u
Revenue Factor
Grade!"#t$out dV%dt&
Grade!"#t$ dV%dt&
Figure 2: Opportunity cost with and without
dVdT
Ta%le 9 sho*s the resulting optimal height of
dra*s for t*o different scenarios !O"#O$ and
!O"#O$%dVdT# The first scenario
+!O"#O$& does not include the term Ld:JdT(
alternative !O"#O$%dVdT does it# It is clear
that the impact of the change in value due to
economic change is significant# The algorithm
*ithout the differential of value *ith time does
not reproduce a realistic scenario %ecause it does
not account for the relation %et*een shut off
grade and metal price returning lo*er 8P: and
mining reserves# On the contrar&( the algorithm
*ith the differential of value on time does couple
price and grade( reporting higher 8P: and
mining reserves#
Draw Point Name HOD_OC HOD_OC-dV/dT
'1N1 75 75
'2N1 75 75
'3N1 75 75
'4N1 105 216
'5N1 105 191
'6N1 105 205
'7N1 105 186
'8N1 105 172
'9N1 105 126
'10N1 105 122
NPV $ !"#$%& !&#"'
Re(erve( )#)$#)* +#$+#&&
Table 2: $omparison of two different
schedules without and with dVdT
3.3.INTEGER PROGRAMMING
APPROACH TO OPTIMIZE NPV IN A
BLOCK CAVE PRODUCTION SCHEDULE
The pro%lem of 8P: ma0imization in a %lock
caving operation can %e descri%ed as a large
scale( multi7period( mi0ed7integer linear
programming pro%lem# The development of the
model to solve this pro%lem %egan *ith
translating the optimization pro%lem in t*o
dimensions( so that the non linearit& %et*een
tonnage and grade in the o%6ective function is
avoided# Clearl& the pro%lem is B' %ecause the
decisions varia%les are( for e0ample( *hen to shut
off a dra* point( *hich represents the vertical
dimension of the pro%lem and also *hen to open
a ne* dra* point( *hich represents the horizontal
dimension of the pro%lem# The follo*ing
representation of 1 dra* points that contain B
slices each is used to represent the pro%lem in t*o
dimensions# This representation sho*s profit per
slice scaled %& ,...# The order in *hich the
dra* points have %een sorted depends on the
opening se"uence previousl& defined#
2.24 1.12 1.12 11.23
2.24 4.49 2.24 (3.38
9.98 3.24 5.48 6.61
)*#ce +, , Dra" -o#nt +, #
Table ': 2" representation of the slice file(
The ne0t step of the optimization process is to
find a com%ination of the a%ove %locks to e0tract
in ever& period of the schedule that *ill optimize
the overall 8P:# Therefore the pro%lem is to find
a set of %inar& matri0es that *ill tell *hen to
mine ever& one of the %locks making up the slice
file# ) representation of these matrices is sho*n
in Ta%le 1 *ith the e0traction of the first &ear of
the production schedule# The meaning of this
matri0 is that the first 9 slices of dra* point , and
the , slice of dra* point 9 are dra*n in the first
&ear of the production schedule#
0 0 0 0
1 0 0 0
1 1 0 0
Table ): *inary matri+ representing the first
period of the production schedule((
Clearl& the %inar& varia%les should fulfill all the
rules related to %lock cave mining# Cor e0ample
the slices as *ell as the dra* point need to %e
mined follo*ing the matri0As se"uence#
The a%ove algorithm *as *ritten on )P@
,--- *hich is a s&stem for *riting the
optimization pro%lem in mathematical language#
Once the pro%lem is *ritten in mathematical
language )P@ translates the pro%lem and
passes it to CP@$H *hich is the engine used to
search for the solution to the optimization
pro%lem#
The algorithm is presented as follo*s<
Problem dimensions
I ( total num%er of dra* points across the
la&out
7 ( total num%er of slices *ithin a dra* point
$ ( time horizon for the production schedule
Problem Parameters
i*
value
( dollar value for dra* point i slice
num%er *# This parameter is similar to the matri0
presented in Ta%le B
t
et t $on arg M
( production target for period t
i
dr
( ma0imum dra* rate for dra* point i
t
new
( ma0imum development rate per period#
i
Mbloc"
( minimum num%er of %locks to %e
dra*n from each dra* point i
Decision Variables

'

Other*ise ( .
period in mined is slice ( point dra* If ( , t * i
d
i*t
This set of varia%les represents the %inar&
matri0es sho*ed in figure 1
Objective Function
( (
( (
G
+, / i*t
I 7 $
i*t i*
t
d
i * t
d value
Ma!


' ;
+

. "$ere #/ t$e -er#od


d#/count rate
Constraints
'ra* point se"uence *ithin a dra* point
,
,

"
i*t i* "
t
d d
+

. j=1..J, k=1..T, i=1..I


'ra* point se"uence across the la&out
,
,

"
i*t i *"
t
d d
+

= *35, i35##I, "35##$


$ver& slice can %e mined 6ust once
,
,
$
i*t
t
d

. i=1..I, j=1..J
a0imum development rate
,
,

I
i t t
i
d new

. t=1..T
a0imum dra* rate
,
7
i*t i
*
d dr

; i=1..I, t=1..T
a0imum production rate
(
(
M rg
I 7
i*t t
i *
d ton ta et

inimum num%er of slices per dra* point


i
$ 7
t *
i*t
Mbloc" d

(
(
8 i35##I
The a%ove algorithm has %een tested using up to
,.. dra* points *ith 9. slices each and the time
horizon for the production schedule has %een set
to %e ,1 &ears# The time to solve the pro%lem has
%een around 9#D hours using a Pentium 1
computer( 9#, 2Hz of speed and D9. B of ram
memor&#
Ta%le D sho*s the resolution of a 5 dra* point
theoretical pro%lem# $ver& dra* point contains B
slices per column# The economic values per slice
are presented in the first matri0( the follo*ing
matri0es sho* ho* the depletion of the slices *ill
%e performed in ever& of the production schedule#
8ote that the dra* rate used in this case
constrains the e0traction of , slice per period( per
dra* point# )lso the ma0imum num%er of ne*
dra* points per period *as set up to %e 9#
2.24 1.12 1.12 8 (4.5 15.73 21.35
(2.24 8.49 2.24 (3.38 (5.63 (3.38 0
9.98 (3.24 5.48 6.61 (5.76 5.48 (5.76
)*#ce, , Dra" Po#nt, #
1 0 0 0 0 0 0 0
0 0 0 0 0 0 0
1 1 0 0 0 0 0
2 0 0 0 0 0 0 0
0 1 0 0 0 0 0
0 0 1 0 0 0 0
3 0 1 0 0 0 0 0
0 0 1 0 0 0 0
0 0 0 1 0 0 0
4 0 0 1 0 0 0 0
0 0 0 1 0 0 0
0 0 0 0 0 0 0
5 0 0 0 1 0 0 0
0 0 0 0 0 0 0
0 0 0 0 1 1 1
Table ,: -esolution of ./V optimi0ation
using integer programming#
The final reserves outline of the a%ove pro%lem
is presented in Ta%le ;# 8ote that the algorithm
does not smooth the final reserves outline +Ehair
cutF/ %ecause this process is %elieved to %e part of
a second optimization( *hich perhaps specificall&
ma& not %e a task of the strategic long term
planning#
0 1 1 1 0 0 0
0 1 1 1 0 0 0
1 1 1 1 1 1 1
Table 1: Final reserves outline using integer
programming#
This algorithm lacks several constraints that
ma& appl& in the planning of a %lock cave mine
such as reserves outline smoothing( dra* ratio
%et*een a dra* point and its neigh%ours#
Ho*ever the intend of this algorithm is to operate
in con6unction *ith a s&stem such as PC7BC that
could introduce the level of detail desired for the
planning of the %lock cave#
4 MINIMIZE THE DIFFERENCE
BETWEEN TWO SURFACES USING
QUADRATIC PROGRAMMING
There are t*o applications of this o%6ective
function= the first one is the application of an
angle of dra* as the desire dra* profile( the
second one is the minimization of differences
%et*een actual height of dra* versus a desired
target# The first application is related *ith having
a EgoodF dra* performance *hich leads to
retarding the dilution entr& point# If dilution is
dela&ed the life of the mine is prolonged( since
dra* points can still %e opened for a longer
period of time# The second application of this
o%6ective function is more related *ith the link
%et*een long term plans and the short term plans#
The long term plan provides the target height of
dra* for a certain period of time and the short
term plan provides the current height of dra*
situation#
The first application to minimize the difference
%et*een the current dra* profile and a desired
dra* profile has alread& %een developed %&
Rahal( 9..B# Ho*ever this author uses a linear
function consisting of t*o main deviations<
current profile *ith respect to a target and current
production *ith respect to a target# The pro%lem
*ith this formulation is that the minimum
deviation could %e achieved %& having a large
deviation at the %eginning of the schedule and a
small deviation at the end of the schedule(
eventuall& resulting in a total deviation e"ual .#
The proposed algorithm in this paper is the
minimization of the s"uare of the deviation *hich
*ill produce a much efficient search mechanism
using "uadratic programming and also a %etter
decision from a scheduling point of vie*#
Therefore all deviations either happening at the
%eginning of the schedule or at the end of it *ill
count the same for the o%6ective function#
Objective function

'

'

$
t
I
i
t it t
d d a
, ,
9
G min
t
a
( num%er of active dra* points in period t

t
d
( average tonnage dra*n in period EtF from
the active dra* points or an& desired target
it
d
( tonnage to %e dra*n from dra* point i in
period t# This is the main varia%le in the
optimization process( *hich ultimatel& leads to
the production schedule
$onstraints
'evelopment rate
t t
8e* v
,##T t # 8ote that this is an
integer varia%le#
Tonnage target
t
I
i
it
t
I
i
it
$$2 d
$$U d

,
,
##T , t %eing
t
$$U
and
t
$$2
the ma0imum and the minimum
production rate in period t respectivel&#
'ra* rate
it it it
it it it
a $2 d
a $U d
G
G

T to , t and I to , i
8ote that dra* ratio
t
dcf
is part of the a%ove
constraint %&
t
it
it
dcf
$U
$2
l( %eing
it
$U
and
it
$2
the ma0imum and the minimum dra* rate per
dra* point per period#
In this case mining reserves represent a
constraint in the optimization unlike 8P:
optimization *here the mining reserves represent
a varia%le in the optimization process# The *a&
of introducing the reserves as a constraint is %&
using a %inar& status varia%le called EclosedF
*hich indicates *hether the dra* point has %een
depleted or not# ?ince the status varia%le EactiveF
is affected %& the closed status varia%le( reserves
affect the status of the active dra* points#
Therefore if a dra* point has %een depleted the
status varia%le EclosedF *ould %e , and the
respective EactiveF varia%le *ould %e .#
?ome assumptions to solve the pro%lem are as
follo*s<
Integer varia%les *ere rela0ed
'ra* points shut do*n *hen the& reach
their Best Height of 'ra*
'ra* rates used *ere constant along the
production schedule
The algorithm used to solve the pro%lem *as
the %asic @inear and Nuadratic ?olver
commercialized %& Crontline Technolog&#
) model of ,. dra* points *ith ,. slices each
*as set up in order to solve the original pro%lem#
This optimization also fits into the categor& of
multi period pro%lem( in this case ,. period
optimization# ) graph sho*ing the overall
cumulated production dra*n from dra* points is
sho*n in Cigure B# In this e0ample the main
o%6ective of the optimization is to minimize the
variance of the tonnages %eing dra*n at an&
given period of the production schedule# 8ote
from Cigure B that %& appl&ing this algorithm the
height of dra*s per period per dra* point
descri%es an overall angle of e0traction or dra*#
It is also possi%le to demonstrate that the angle of
dra* is directl& related to the dra* ratio +
t
dcf
/#
Therefore the angle of dra* can %e easil& planned
and evaluated %& modif&ing the dra* ratio
constraint#

0
1
2
3
4
5
6
7
8
9
10
1 2 3 4 5 6 7 8 9 10
Draw ,oint -e.#
#

-
/
i
c
e
(
Per#od 1
Per#od n
)ngle of dra*

Figure ': 2ngle of draw as a result of
minimi0e the variance of the tonnages drawn
per period#
) different *a& of approaching the pro%lem of
optimizing dra* performance is to impose a
desired dra* surface that is %elieved to follo* a
particular cave %ehavior *hich ultimatel& *ill
minimize dilution# Cigure 1 sho*s a dra* profile
in *hich the first 9 &ears of the schedule *ere
dra*n *ithout constraints and the follo*ing &ears
a particular angle *as imposed to %e follo*ed as
the main o%6ective of the optimization#
The a%ove methodolog& needs to %e carefull&
constrained *ith the minimum tonnage to %e
dra*n per dra* point other*ise isolated dra*
+*hich is undesida%le/ could %e an optimal
solution for the algorithm# Therefore the upper
and lo*er %ound for the dra* rate should %e
carefull& studied and controlled %& the dra* ratio
parameter# It is clear that a more rela0ed dra*
ratio constraint *ill produce a more productive
schedule ho*ever this ma& induce the entrance of
earl& dilution and point load on the ma6or ape0
pillar#
0
1
2
3
4
5
6
7
8
9
1 2 3 4 5 6 7 8 9 10
Draw ,oint (e.uence #
C
u
m
t
o
n
(

0
(
/
i
c
e
#
1
0n#t#a* -er#od/
F#na* -er#od

Figure ): 3inimi0e the difference between
the current and the desired draw profile#
5 CASE STUDY
The follo*ing case stud& presents a mine that
contains ,9,- dra* points in the current la&out#
The mining method is panel caving *ith
traditional undercutting# The pre computed
mining reserves corresponds to 9B5 t *ith
.#-3OCu# The mill capacit& has %een set up to %e
a ma0imum of ,, tJ&ear# Cigure D sho*s a B'
displa& of the la&out using PC7BC soft*are#


Figure ,: '" display of a 1214 draw points
layout#
The current mining cost structure used in the
optimization is presented in ta%le 5# These costs
do not include fi0ed costs *hich are added
separatel& in the evaluation of the production
schedule#
5tem 6nits Value
ining and Processing Costs PJt -
etallurgical recover& O 3D
etal Price Copper PJl% .#3D
?melting and Refining costs PJl% .#9
Overall revenue factor 78$u 12(19

Table :: $ost structure used in the
optimi0ation(
The ma0imum development rate per &ear *as
set up to %e ,9. dra* points# The dra* rate
varies per dra* point and it moves in range .#D to
.#;D tJm
9
Jda&#
Ta%le 3 sho*s the result of the optimization
using varia%le shut off grade approach# It is
possi%le to see that the increase in the 8P: is
a%out ,-O *hile the mining reserves are reduced
%& ,9O *ith respect to the %ase case#
2tem 3a(e Ca(e O,timi4ed Ca(e
NPV!1& 219,486,71 261,428,012
Net DV co/t/ !1& 44,055,822 37,775,780
Cu 2 0.9800 1.0007
3o 2 0.0292 0.0291
P4 2 0.0016 0.0016
5# !6"$%tonne& 16.0461 16.0022
Re/erve/ !tonne& 237,007,056 208,440,656

Table 9: ./V optimi0ation using variable
shut off grade approach
8ote from ta%le 3 that the increase in the 8P:
is due to the optimization of the %lended grade
and the reduction of the development rate# The
evolution of opportunit& cost throughout the
optimization process is sho*n in figure ;#
(0.5
0.0
0.5
1.0
1.5
2.0
2.5
1/t #terat#on
2nd #terat#on
3rd #terat#on
7
-
-
o
r
t
u
n
#
t
8

C
o
/
t

!
1
%
t
o
n
n
e
&
Per#od
Figure 1: Opportunity cost for different
iterations throughout the optimi0ation process
The difference %et*een shut off grades across
the economic la&out for the %ase case and the
optimized scenario is presented in figure 5# It is
interesting to note that the last dra* points in the
optimized se"uence and the %ase case shut off
grade is similar# Bet*een se"uence num%er 9..
and B.. the shut off grade for the optimized case
is lo*er than the %ase case %ecause there is no
enough fle0i%ilit& or rather active dra* points to
fulfill the production target# Then the
optimization algorithm decides to keep lo* grade
dra* points active to achieve the desired
production rate#
0 100 200 300 400 500 600 700 800 900 1000
0.70
0.75
0.80
0.85
0.90
0.95
1.00
1.05
1.10
)
$
u
t

o
9
9

:
r
a
d
e

!
2
C
u
&
)e;uence +
7-t#<#=ed ca/e
>a/e ca/e
Figure :: -esulting shut off grade
throughout the life of the mine#
6 CONCLUSIONS
Operations research tools can %e used to plan
and schedule %lock cave mines# The level at
*hich these tools are applied *ould define the
success of the resultant production schedules#
The process of identif&ing the constraints that
appl& to the corresponding planning horizon is a
critical step in defining the operations research
pro%lem# ) *rong decision a%out a set of
constraints could lead to a good ans*er for the
*rong pro%lem# The process of esta%lishing the
ade"uate constraints ena%les mine planners to
%etter understand the mining pro%lem#
The use of opportunit& cost in production
scheduling can lead to improvement of the 8P:
of the operations %& several million dollars# The
reserves as *ell as the development rate are in
this case rather an output of the optimization
process than an input#
Curther research needs to %e done in order to
develop ne* technologies that could perhaps
have the a%ilit& to integrate ne* constraints that
*ould %etter forecast the reaction of the rock
mass to different mining strategies# In particular
the addition of uncertaint& %ased upon actual
performance *ill %e a ke& parameter to %e
incorporated in the future generation of
production schedulers in %lock caving operations#
ACKNOWLEDGEMENTS
Cunding for this research pro6ect *as provided
%& 2emcom ?oft*are International and the
8ational Research Council of Canada# )lso
Universit& of British Colum%ia to provide
guidance along the research presented in this
paper# In particular 'r# ?cott 'un%ar( 'r#
alcolm ?co%le for their contri%ution to finish
this paper#
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Chanda $ C Q( +,--./# +n +lication of Integer
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