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Optimising mining operations – a discussion of practical constraints and opportunities

Optimising mining operations – a discussion of practical constraints and opportunities. Outlook. Everything feels good now as prices are high. However . What potential exists in Open Pits?. Underground?. Processing?. Going forward. 3-Phase Process.

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Optimising mining operations – a discussion of practical constraints and opportunities

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  1. Optimising mining operations – a discussion of practical constraints and opportunities

  2. Outlook Everything feels good now as prices are high. However ...

  3. What potential exists in Open Pits?

  4. Underground?

  5. Processing?

  6. Going forward 3-Phase Process • Benchmarking & time studies to identify opportunities • Determine effectiveness of reporting & planning systems • Determine barriers to change • Value opportunities • Identify & prioritise solutions • Prepare implementation plans Phase 1 Phase 3 Phase 2 Perpetuation Implementation Diagnosis, analysis, planning • Make the implementation plans happen • Change management – strategy , policy, enhanced working practices, better supervision, training, new technology • Ensure the improvements are maintained and enhanced through ongoing review and support • Instill a culture of continuous improvement • Re-set technical limits – ‘raise the bar’

  7. Use appropriate tools to set targets Deliverables • Solid understanding of current operating situation • Prioritized set of KPIs that drive value • Specific limits and targets for highest value KPIs • Theoretical/design limits of equipment (adjust + for safety factor) • Benchmarking • Repeated best • Observations/trial • Management consensus DIAGNOSING THE OPPORTUNITY/SETTING GOALS Build a fact base to understand operations Operating equipment effectiveness Historical performance Process maps

  8. ANALYTICAL TOOLS - MAINTENANCE BENCHMARKING Equipment maintenance strategy Spare parts and contractor management Performance levels Organization structure Procurement Level 1 “Expert” “Best Practice” • Maintenance strategy is in place with excellent results • Maintenance prevention is the main focus • Workers are flexible to work in different areas • Team leader concept is fully in use • Purchasing of equipment is based on total cost of ownership, ramp-up time, changeover time, maintainability, reliability • Number of vendors reduced • Parts availability, quality, inventories, and usage are under control • Full standardization achieved for all machines/parts • Org boundaries crossed often • Span of control appropriate for nature of work/worker skills • Organizational structure clear • Maintenance system exists with good results • Diagnostic toolsare introduced • Strategy for major equipment is in place • Lifecycle costs part of purchasing decision • All depts are involved in purchasing process • OEE is improving fastStandardized parts list is widely used • Vendors are selected • Parts availability and usage daily tracking is in place • Pull replenishment system is in place to reorder parts Level 2 • Machine history is recorded and analyzed • Criticality of partsis understood • Spare parts inventorieshave been decreased and new standards set • Parts usage is kept under control • Pressure is on parts quality Level 3 • Maintenance is involvedin purchasing of new equipment • TCO is defined • Standardization has begun • Model lifecycle cost equipment exists • Span of control manageable • Staffing is applied well across shifts • Few classifications exist Level 4 “Basic” • No clear maintenance strategy exists • Breakdown maintenance widely used • Organizational structure unclear • Large number of classifications • Staffing weak on shifts • New equipment purchasing is based on initial cost and technical specifications • Parts usage, quality, availability, and inventories have to be placed under control

  9. Roles of each advisor PwC Understand current efficiency Understand actual costs Implement information systems Create link to financing SRK Understand current effectiveness through benchmarking • Identifies opportunities • Highlights effectiveness of current information system • Highlights priority • Overcomes resistance to change Understand long term mine plan • Identify future issues • Understand effectiveness of the planning system • Value potential for change Consider re-engineering the operation • Alternative mining or processing method • Change of technology

  10. Summary • Most mines we have visited can increase productivity by 20-30% • Most changes do not require significant investment or new skills • Key is good quality information and understanding the impact on productivity and costs • Understanding benchmarks helps overcome resistance to change • Best solutions improve effectiveness as well as efficiency • Start now to prepare for tighter markets

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