The Value of Geological Human Capital in the Improvement and Maximisation of Ore Deposit Value – The Kalgoorlie Consolidated Gold Mines Experience

摘要

In 2010, Kalgoorlie Consolidated Gold Mines (KCGM) was Australia’s largest gold producer, withrntotal annual production of 788 000 ounces. Of the gold produced by KCGM in 2010, 95 per centrnwas extracted from the Fimiston open pit, also known as the Superpit. The Fimiston operationrnencompasses the historic Golden Mile, from which more than 55 million ounces of gold have beenrnextracted from the world-class Fimiston lode style mineralisation.rnThe operational performance of the KCGM Fimiston open pit was reviewed for the periodrnbetween 2005 and 2010. Key performance metrics reviewed included mined tonnes and grade,rncost per ounce of gold produced and the mine to mill reconciliation trends. The years 2007 andrn2008 were characterised by a decline in performance against key performance metrics. The orernzones were diluted, with the excess tonnes mined resulting in lower grade and an increase in therncost per ounce. Poor reconciliation between ore mined, the ore reserve model and the grade controlrnpolygons was also observed.rnA series of improvement initiatives were implemented in late 2008. As a result of changes madernto the grade control and mining practices, the site performance recovered. Unplanned dilutionrnwas reduced, which had a positive impact on mined grade. The lower tonnes combined with higherrngrade reduced the cost per ounce to below budgeted levels in 2009 and 2010, enhancing thernprofi tability of the operation.rnThe operational performance between 2005 and 2010 was compared to the turnover statisticsrnfor the KCGM geology department over the same period. Turnover accelerated between 2005 andrn2007, peaking at an annualised rate of 43 per cent. With the onset of the Global Financial Crisisrnand the implementation of retention initiatives, turnover reduced signifi cantly between 2008 andrn2010. A strong consistent correlation was observed between the turnover trends in geology and thernperformance of the grade control function and resultant site metrics.rnThe cost of turnover is known intuitively, however, rarely quantifi ed. To evaluate the benefi t ofrnthe improved performance, a detailed fi nancial model was used to quantify the impact of the graderncontrol function. In 2010, the headgrade exceeding budget by just four per cent contributed anrnadditional A$24 M of value to KCGM. In contrast, if the 2008 performance had been replicated inrn2010 (-9 per cent on headgrade), the result would have removed A$61 M in value from the business.rnThe KCGM experience between 2005 and 2010 demonstrates the value of human capital inrna mining operation and the importance of a high performing geology grade control team to thernprofi tability of a mining operation.