Stripping Ratio(s) – Surface Mining

  1. Types and definitions
  2. What does a SR measure?
  3. What to use the SR for?

On TerminologyStripping Ratio Surface Mining 300x234 Stripping Ratio(s)   Surface Mining

  1. Overburden O/B
  2. Coal / ore
  3. Interburden (or parting), I/B
  4. Waste

Sometimes:
Waste = O/B + I/B
(look at the context)

Waste (O/B + I/B) needs to be removed to get access to coal / ore

What Is Stripping Ratio?

Measures relative deposit depth

Q: How important is depth in surface mining?

  • Consider Chuquicamata at 850 m depth, SR = 0.5
  • Consider Capital Quarries , Rolla, at 25 m depth, SR = 0.5

To surface mine we need to remove some waste in addition to ore / coal
SR measures how much waste needs to be removed so that a unit of ore/coal can be mined
This means “relative depth

Geologists vs. Miners

How do the Geologists measure SR?

  • Look @ sections and measure thickness of waste and ore / coal
  • Express SR the ratio of thickness, eg: m/m, ft/ft

How do the miners differ

  • We know that the slopes are not vertical
  • We calculate the amount of waste that needs to be removed to get an amount of ore/coal

Miners Only….

SR measures the amount of waste that needs to be removed to get an amount of ore, just as we mine it.

  • Note the “amount”!

This will differ depending on time span under consideration

  • Initial studies (feasibility) – overall stripping ratio
  • Current month – incremental stripping ratio

What is an “Amount”?

Depends…..
Coal miners measure waste in BCM, or bcy, and coal in tonnes or tons

  • Thus in coal SR is the number of BCM of waste that needs to be removed to uncover 1 t of coal
  • Some applies in other bedded deposits

Ore miners measure both waste and ore in tons or tonnes. Definition of ore/waste changes!

  • Thus in ore SR is the number of tonnes of waste that need to be removed to uncover one tonne of ore

More Complications

Units in use differ between countries
Each country uses its own units to define stripping ratios

  • Consider McIntyre Coal: BCM/long tons

What is a long ton? Some coal & iron ore trades internationally in long tons!

  • Consider Bingham Canyon: tons / tons
  • Consider Rheinbraun: BCM/ tonnes

Stripping Ratio Surface Mining 1 Stripping Ratio(s)   Surface Mining

  • Overall Stripping Ratio
  • Incremental Stripping Ratio
  • Units: volume to mass (BCY/t)
  • Units: mass to mass (t/t)
  • Units: metric vs. American vs. Imperial

SR = 2:1 (m / m)

Uses of Stripping Ratio

Definition of pit limits

  • At what SR can we still make money

Unit value of ore minus cost of ore AND waste mining gives us profit or loss estimate
Production scheduling

  • Mine the areas with low SR first
  • To maximize cash flow

Definition of mine feasibility / profitability

  • Rough economics if no better data available

Incremental or Overall SR?

Most evaluations / plans are done based on incremental stripping ratio

  • The initial money was sunk already
  • Of concern is what it would take to get that extra tons

Overall SR used in early evaluations of mines
Overall SR is normally “capitalized”

  • What does that mean?
  • Does the Taxman have something to do here?

MOTHERHOOD STATEMENT : If you work in a mine, ALWAYS use incremental stripping ratio

Use overall stripping ratio only on capital projects

SURFACE OR UNDERGROUND?

  • Which type of mining is better for your deposit?
  • If it is surface mining, when do you stop mining?

A Brief Summary

Surface mining is much cheaper

  • may result in more profit, but……

Surface mining requires (most often) waste removal

  • waste removal cost money and lowers profit

Break even point exists at which both surface and u/g mining are equally (un)profitable

  • Remember the “Motherhood” statements?

Stripping ratio allows definition of this “breakeven” point

Break-Even SR (BESR)

  • Defines surface/underground switch-over point
  • Occurs when all money saved by mining from surface, as opposed to u/g mining, is expended to remove waste

BESR = (UCUM – UCSM) / UCWR

  • UCUM – unit cost of underground mining
  • UCSM – unit cost of surface mining
  • UCWR – unit cost of waste removal

THE ANSWER:

Switch to Underground Mining if your stripping ratio is more than BESR

Switch To Underground Mining

May or may not be economically feasible

  • Consider value of ore

Major expense/effort is required to switch

  • Major capital expenditure: how to handle this?
  • Is there enough ore left to pay for the switch?
  • Do we have expertise to mine underground?
  • Are there other opportunities to make more $$?

A decision may be made not to mine underground even if it would be profitable

Surface Mining or Underground Mining1 Stripping Ratio(s)   Surface Mining

Break Even Point: Discussion

Cost of mining – you control it!

  • Relative difference between underground, surface
  • Relative difference between ore, waste

Economics usually determined by:

  • Geology of the deposit
  • Compare: Escondida mine, Chile vs. a Kansas quarry
  • Efficiency and effectiveness of mining methods
  • Economic considerations:
  • Interest rates, discount rates, other

ULTIMATE PIT DEPTH

  • How to determine the optimum depth of a surface mine?
  • What does it depend on?
  • What has an impact on it?

Ultimate Pit Depth

SR measures the relative depth
Stop mining when you stop making money

  • Value of ore (UVO) is equal or less than the sum of:

cost of mining (UCM),
cost of waste removal (UCW), and “other costs” (UCO)

ESR = [UVO - (UCM + UCO)] / UCW
Interpretation:

  • how many units of waste can be removed for each unit of ore before you stop making money

What Are “Other Costs”

Costs borne in relation to this property

  • Cost of discovery and exploration
  • Or cost of acquisition
  • Permitting and other costs
  • Cost of infrastructure and development

Minimum acceptable profit

  • Shareholders expect a return
  • Consider that you have other alternatives in relation to spending money

SR: Definition of Pit Limit

SR Definition of Pit Limit Stripping Ratio(s)   Surface Mining

Slope Angle & Pit Limits

Slope Angle Pit Limits Stripping Ratio(s)   Surface Mining

Interest Rate & Pit Limits

Interest Rate Pit Limits Stripping Ratio(s)   Surface Mining

SR & Underground Mining Cost

SR Underground Mining Cost 300x283 Stripping Ratio(s)   Surface Mining

SR & Open Pit Mining Cost

SR Open Pit Mining Cost 300x234 Stripping Ratio(s)   Surface Mining

Note: Mining Cost Changes!

So,…

  • How deep / far will we mine this one?
  • What is the value of ore?
  • Does grade has to be considered?

Unit cost of surface mining is

  • Waste at $1.50 per ton
  • Ore at $2.00 per ton

Surface Mining 221x300 Stripping Ratio(s)   Surface MiningUnit cost of underground mining is $15/ton
Unit value of ore is $20/ton
Other cost of mining (“profit”) are $2/ton

  1. Define the depth at which u/g mining should be considered
  2. Define the depth at which you should stop mining

Other Considerations

  • BESR and ESR depend on economics

unit value of ore
unit cost of mining waste, ore, other

  • Economics do change
  • The results are valid only if these changes are insignificant
  • Significant changes must trigger re-evaluation of the deposit

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