Long-Term Scheduling

J Whittle1

ABSTRACT
This paper describes modern long-term mine scheduling and gives an example of its application.
It then discusses the obstacles to the implementation of such schedules.

INTRODUCTION
Computerised long-term mine scheduling has been used in various forms since at least the 1980s.
This paper first details what long-term scheduling now offers in terms of the resource details and
constraints that it can handle and the variables it can manipulate.
It then goes through a scheduling example, which illustrates the sort of gains that can be made. The
schedule that is produced is unusual in a number of respects, and flies in the face of some long-held
mining mantras. The paper describes how these mantras can obstruct the implementation of such a
schedule.

THE RESOURCE
As in any modelling, a balance has to be struck between detail and relevance. Long-term scheduling
is concerned with what is done each year not what is done each day, or even each week. For this
purpose it is usual to break the resource into units generally known as panels, where a panel might
represent a bench within a particular phase in an open pit mine or it might represent a stope, or part
of a stope, in an underground mine.
A panel is not necessarily homogeneous. It may consist of a number of parcels of material with
different properties. These parcels may be treated differently. Some may go to waste, some to
stockpiles and some to a mill, depending on the requirements at the time.
In an open pit, the different parcels on the panel/bench will be accessed horizontally and the
sequencing of such access is an essential part of daily scheduling. However this is irrelevant to long-
term scheduling. If the whole of a panel is to be mined in a particular year, the scheduler is not
concerned with the day-to-day details of how this is done, it is just concerned with total quantities.
Most long-term schedulers take the further step of assuming that, if only a part of a panel is to be
mined in a year, then the same fraction of each parcel will be mined. This is not how the material will
actually be mined, so that some small adjustments to the schedule will be made when the mining is
done. These adjustments will have a negligible effect on the value of the project.

THE CONSTRAINTS
The essential feature of a panel is that it must be mined completely before the mining of other panels
below or beyond it starts. The simplest form of this is when a sequence of panels represents a phase
in an open pit. Clearly each panel must be completely mined before the panel below it is started.
However, there can be more complicated constraints, particularly where the panels represent
underground stopes. There can be many constraints which specify that particular panels must be
mined before one or more other panels are mined.
In open pit mining we also have relative depth constraints between adjacent phases. There can be
both minimum and maximum depth leads between phases, and these can be fractional. Phases may
overlap in plan so that these minimum and maximum leads can form a tree structure.

1. FAusIMM, Technical Director, Whittle Consulting Pty Ltd, Suite 8, 660 Canterbury Road, Surrey Hills Vic 3127. Email: jeff@whittleconsulting.com.au

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A further constraint involving panels in open pit mines is that there is generally a limit to the
number of panels in a phase that can be mined in a year. This is an organisational or structural limit
rather than a tonnage limit. That is, you cannot mine more than a certain number of panels in a year,
no matter how much equipment you have available.
There can be range of throughput constraints. These are input and/or output limits for procedures,
and delivery limits between procedures. (Here the term procedure is used to cover any operation
such as mining, crushing, grinding, flotation, smelting or blending.) These limits can apply to a
procedure or a group of procedures and they can limit total dry tonnes, wet tonnes or nickel, for
instance.
There can be minimum and maximum average grade restrictions on the material input to
procedures.
There can be constraints on the space available for stockpiles.
Most of these constraints, except for the purely geometric ones, can vary from year to year.

THE VARIABLES
The most obvious variable that a scheduler has to deal with is the amount mined from each panel in
each year, but there are many others.
Once material has been produced by a procedure, including mining, there are four things that can
happen to it. It can be delivered to a waste dump, it can be delivered to a stockpile, it can be delivered
to a customer or it can be delivered to another procedure, and there may be alternative procedures
available. Cut-offs and cut-overs can be involved in this.
In many cases delivery is irrelevant. In others, there may be significant costs involved or there can
be alternative ways of delivering material to, say, a port, each with its own limits and costs.
All throughput limits, and the limits on stockpile capacity, can, in theory, be expanded either by
paying a premium (eg contract mining) or by spending extra capital. There may be a limit on the total
capital available so that the optimiser has to weigh the advantages of different expenditures.
There is a further variable which is seldom considered. Most processing plants can be operated at
a range of throughputs, with a related range of recoveries. The higher the throughput, the lower the
percentage recovery. Within this range the throughput can be varied from year to year, with some
extra costs.
Sometimes we need to optimise a complex consisting of multiple open pit and underground mines
with shared and alternative processing and delivery options. This greatly adds to the number of
variables.
The scheduler has to find values for the variables that will maximise the project value while meeting
all the constraints. This would be comparatively easy if the variables were independent of each other.
However, the variables interact with each other directly and through the constraints. Change one
variable and the best values for many of the others will change. Consequently it is essential that
all these variables be optimised simultaneously, and there is a range of software available that will
optimise some or all of them.
Unfortunately, there are two major variables that cannot currently be included in a simultaneous
optimisation, in part because human judgement is involved. These are the ultimate pit limit and the
phase design. Although some software attempts to do this, it generally cannot handle all the other
variables described above.
At Whittle Consulting Pty Ltd, the procedure is to manually iterate pit limit and phase design with
simultaneous optimisation of all the other variables. In passing, it may be of interest to know that
the design of the first phase has far more influence on the project value than the design of the other
phases or of the ultimate pit.
There is another matter: uncertainty regarding the resource and the future economic conditions.
Ideally it is desirable to find the schedule that maximises the value of the project, subject to some
specified level of certainty that the target will be achieved. The writer does not know how to do that
at the same time as dealing with all the other variables.

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EXAMPLE
In order to illustrate the value of being able to flex all these variables, a case study based on an
artificial orebody was set up. Many will be familiar with the Marvin copper/gold orebody. The initial
assumptions were:
single copper/gold pit with four phases;
60 Mt/a mining;
a maximum of eight benches per year advance in a phase;
20 Mt/a crush/grind/float producing 28 per cent copper concentrate;
88 per cent copper recovery, 60 per cent gold recovery;
70 km 600 Kt/a pipeline to port;
offshore smelter/refinery;
gold price $900/oz;
copper price $2.50/lb declining to $1.50 in the first five years; and
initial capital expenditure of $582 M.
An overview of this case study is given here, but there is more detail in Whittle (2010).
First a manual design and schedule were produced. Then pit limit, phase, skin and schedule
optimisations were carried out using the Gemcom Whittle software. These were optimised separately,
but they were iterated manually. The NPV increased by 18 per cent from $1597 M to $1885 M. This
can be regarded as normal modern planning.
Next cut-off and stockpile optimisation, which is available in Gemcom Whittle but seldom used,
was carried out. Again the different components were optimised separately but iterated manually.
This raised the NPV to $2201 M, an increase of 17 per cent on the normal modern plan.
Next the Gemcom Whittle SIMO option was used to do schedule, cut-off and stockpile optimisation
simultaneously, with manual iteration of the pit limit and phases. This added a further ten per cent.
In other words, just optimising these things simultaneously, rather than separately, gave a ten per
cent increase.
Finally simultaneous optimisation of the mill throughput/recovery calibration, the concentrate
percentage, and the capital expenditure on the mining fleet and the pipeline were added. This gave
an NPV of $2775 M.
This final NPV was 74 per cent higher than the manual plan and 47 per cent higher than the normal
modern plan.
It might be reasonable to point out that this is a created model not a real one, and it is true that
it was arranged it so as to illustrate each of the possible effects. However, overall gains like this are
typical. It is no surprise when ways of increasing the value of a mining complex by a billion dollars
are found. It has happened several times.

IMPLEMENTATION
These are very significant gains. What about the implementation?
What does this plan look like? Its most obvious feature is that every year of the plan is different.
Figure 1 shows the mining rate for the fully optimised plan. The optimiser spent a little more capital
to increase the mining capacity from 60 Mt/a to 83 Mt/a but only used the whole capacity in three of
the years. There are significant periods with idle equipment.
The following is a quote from the web site of a mining software house:
Practical scheduling is all about satisfying mill or process feed capacities while maintaining
a steady truck fleet.
On the face of it, this makes sense. If the mining rate is kept constant, the cost of mining per tonne
is reduced. Cut the cost per tonne and the mine will be more profitable.
However, the profitability of the mine has been significantly increased by changes which included
varying the mining rate. That presents a problem because the key performance indicator (KPI) for
the mining manager, on which his or her salary depends in the long run, usually includes minimising
the cost of mining per tonne. If the mining rate is varied significantly, the mining cost per tonne will
inevitably go up.

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FullyOptimisedMiningRate
100

MillionsofTonnesperYear
80

60

40

20

0
0 2 4 6 8 10 12 14 16
Year

FIG 1 - The annual mining rate for the fully optimised plan.

No one questions that for a given mining schedule the aim should be to reduce the cost of mining
per tonne. Indeed reducing any cost will improve profitability, provided that the long-term schedule
is not changed.
Aiming to minimise the mining cost per tonne for a given schedule is not the same as aiming to
schedule so as to minimise the mining cost per tonne, but that is what is commonly done.
The tail is wagging the dog.
Go back to basics and ask why the mine is operating at all. Is it operating to minimise the cost of
mining? Is it operating to produce as much gold as possible? The writer doesnt think so.
Why do the shareholders invest their cash? They want it to make as big a profit as possible, and
they want the profit as soon as possible. They want it soon because a dollar today is worth more than
a dollar in a years time, and a dollar today gives a certainty that a dollar in a years time does not.
Let us look at another aspect of the schedule. Figure 2 shows the mill throughput for the fully
optimised plan. Remember that the nominal throughput was 20 Mt/a. In this schedule, recovery
has been sacrificed for most of the life of the mine, in order to get more material through the plant.

FullyOptimisedProcessingRate
30
MillionsofTonnesperYear

25

20

15

10
0 2 4 6 8 10 12 14 16
Year

FIG 2 - The annual mill throughput for the fully optimised plan.

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In fact, the logic behind this is very similar to the logic behind cut-off optimisation. In this case such
a plan will probably clash with the plant managers KPI.
There are other radical changes but, in summary, the action taken has:
reduced the size of the ultimate pit and hence the reserves,
increased the mining cost per tonne,
reduced the recovery in the plant for much of the project life,
increased the capital expenditure by five per cent, and
reduced the life of the operation by three years.
Note that each of these changes is counter-intuitive and would have been resisted by the relevant
manager. Also, if any of them were to be made in isolation, the result could be disastrous. The changes
must be part of a long-term carefully coordinated plan.
In some cases, the variations from year to year can be reduced a little without too much impact on
project value, but this should only be attempted, with care, after the full optimisation has been done.
Also, when optimising large mining complexes where resources can be used for different areas, the
swings are usually less wild.

THE REAL CHALLENGE

Today, the real challenge is no longer a software challenge, it is a human one. In order to get these
gains, which are real, and available to almost any mine, there is a need to change the way mines are
managed.
Currently some decisions, like the mining and processing rates, are made and cast in bronze far too
early and on too little evidence. It then becomes difficult, though not impossible, to change them.
For simplicity, the running of the mine is divided into different silos and over-all targets are set
for each. To keep their lives simple, the various silo managers concentrate on their own area and
have little interaction with other managers in relation to long-term planning. A lot is paid for this
simplicity.
Management will protest that, if we reduce the reserves, the share price will go down! Well it wont
if the market is told that the plan is to pay back the whole of the capital cost in eight and a half
months rather than seventeen months, and that the net revenue for the first three years will be four
times the total capital cost.
Figures 3, 4 and 5 show the net cash flows for the manual, the normal modern and the fully
optimised plans.
Most investors would greatly prefer Figure 5 to Figure 3 or Figure 4. Figure 5 offers more growth
opportunities and/or dividends even after allowing for taxation and any royalties. The point is that

ManualNetCashFlow
1000

800
MillionsofDollars

600

400

200

0
0 2 4 6 8 10 12 14 16
Year

FIG 3 - The annual net cash flow for the manual plan.

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NormalModernNetCashFlow
1000

800

MillionsofDollars
600

400

200

0
0 2 4 6 8 10 12 14 16
Year

FIG 4 - The annual net cash flow for the normal modern plan.

FullyOptimisedNetCashFlow
1000

800
MillionsofDollars

600

400

200

0
0 2 4 6 8 10 12 14 16
Year

FIG 5 - The annual net cash flow for the fully optimised plan.

the gain is usually so substantial that it improves the mine value however it is measured. In the long
term the share price will follow the value, and this is long-term scheduling.

CONCLUSIONS
The next challenge in optimising mining operations is not to develop new software. The next
challenge is to change the way mines are run. Better planning and more flexibility is needed. The
most expensive words in any business today are: We have always done it this way.

ACKNOWLEDGEMENT
Although the writer wrote the software we use in our consultancy, much of the credit for these
developments should go to our son Gerald Whittle. He saw possibilities that the writer had not
dreamed of, and he ran with them.

REFERENCES
Whittle, G, 2010. Enterprise optimisation, in Proceedings Mine Planning and Equipment Selection (MPES)
Conference, pp 105-117 (The Australasian Institute of Mining and Metallurgy: Melbourne).

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