GRADE EXPECTATIONS ROOT CAUSE ANALYSIS OF FIRST TWO YEARS' PRODUCTION ESTIMATES

摘要

After Feasibility Study and project approval, mining companies communicate key metrics of new projects to investors and the market. These include schedule, capital, operating costs, and production estimates. When any of these metrics fall short, the market can react negatively resulting in erosion of confidence, market capital and net value. One of the more sensitive metrics, and perhaps most difficult to predict, is the metal production for the first two years after commercial production is declared. There are a number of root causes that can lead to over- or under-estimation, which can be measured by grade/quality, process throughput, and process recovery which all impact metal produced. The expectation of underlying resource grade is often singularly identified as the cause, but this study shows that while it is indeed a significant potential root cause, a broader understanding of other contributors is needed for a holistic understanding of uncertainty. This paper describes a root cause analysis approach to explain variance of production estimates from four projects developed between late 1990s and late 2000s. It further describes how this analysis has been used to develop models that predict future production ranges for new projects through the analysis of these root causes and simulation.