The shut-off value for a panel cave mine determines when a draw point will be shut-off and mining will cease from that draw point. In this series we will examine which parameters are important for determining the shut-off value and what strategies an engineer can use when deciding which shut-off value to use.
This post presents key concepts to use when determining the shut-off value.
Production Rate
There are many factors which impact the shut-off value but the target production rate is the most important because the production rate will determine whether or not to use a shut-off value. For a panel cave the production rate can be expressed in the following formula:
P = N * A * D * H
P – Production Rate
N – Number of new draw points per period
A – Area of a draw point
D – Average density
H – Average Height of draw
The production rate, along with the number of new draw points opened per period will determine whether there is excess mining capacity. The draw rate will also contribute to whether there is excess mining capacity because it determines how quickly a draw point can be mined. The draw rate and the HOD can be used to calculate the closure rate of draw points. This closure rate should not be higher than the draw point development rate, otherwise there would be no excess mining capacity. The shut-off value determines the height of draw of the draw points because it determines when to close them. Each shut-off value will have a corresponding HOD. To determine which shut-off value to use you must calculate the minimum HOD required for the set production rate and draw point development rate. To calculate the minimum HOD we would rewrite the production rate formula as follows:
H = P / ( N * A * D )
The area of a draw point is determined by the draw point spacing used in the design and the average density would be taken from the block model. The number of new draw points developed per period is a combination of the draw point development rate and the number of active mining panels. Typically the number of new draw points developed in a year would range from 120 to 96 for a single panel. Developing more panels at the same time will increase the number of new draw points per period.
For a set production rate and draw point development rate, the minimum HOD can be calculated. The shut-off value which gives a HOD that is closest to this minimum HOD, but not below, will return the highest NPV for the project.
The Ideal Case
The ideal case for any panel cave mine is to have a layer of high grade material sitting below a layer of low grade material which sits below a layer of waste. This is also the best situation to apply a shut-off value because all of the highest grade material is at the bottom of the draw column for every draw point. In Figure 1 the red material is high grade with an NSR of \$50/t, the blue material is low grade with an NSR of \$20/t, and the black material is waste with an NSR of \$0/t.
Once the mixing occurs, the ideal case will have a smooth grade gradient from highest grade at the bottom to lowest grade at the top. This situation implies that it will always be better to mine from the material at the bottom of a draw column instead of at the top.
The Height of Draw
For this analysis the mining and processing cost was set at \$15/t. A shut-off value of \$15/t will give the maximum mining reserve for this ore body. This shut-off value gives a draw column height of 360m. This height of draw corresponds to the break even shut-off value and drawing higher than this height will incur a loss of value. For the ideal case all of the draw points will have the same HOD.
A rectangular mining layout was used for the ideal analysis. This layout has a draw point spacing of 15mx15m and uses a herringbone layout. This layout has 2040 draw points. A typical panel cave can have between 500-3000 draw points. For the larger panel caves they are separated into mining panels and can be mined simultaneously to increase the production rate.
Analysis
The analysis will only have one mining panel mining at a rate of 20Mtpa. Applying the break-even shut-off value of \$15/t gives a total tonnage of 455Mt. The number of new draw points per year is 120. The average density is 2.7t/ m3 and the draw point area is 225m2. Using these numbers to calculate the minimum required HOD results in 274m. The shut-off value which will give the highest NPV should be \$22/t because it has the closest average HOD to the minimum required HOD without it being below.
Production schedules were run using GEOVIA PCBC™ with the above parameters to determine the NPV with varying shut-off values. From Table 2 it can be seen that the shutoff value of \$22/t generates the highest NPV. Compared to the break even shut-off value, the NPV increased by \$266M and total tonnes decreased by 103Mt for the \$22/t shut-off value.
Using a shut-off value above the break-even shut-off value will always produce a higher NPV due to the time value of money. Using the production rate formula for a panel cave, a mining engineer can calculate which shut-off value to use by determining at which height the production rate would no longer be sustainable. Maximizing the production rate and draw point development rate with the corresponding HOD will produce the highest NPV for any given panel cave mine.
In our next post, we will use a case study to illustrate how to choose a shut-off strategy when planning a cave mine to increase the Net Present Value (NPV) of the project.
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