Optimising value chains from Mine-to-Market

Challenging Pre-Existing Planning Assumptions

Evaluating alternatives to long held planning assumptions can act as a catalyst to realign decisions across a supply chain, in other words, addressing the integrated mine planning problem.

In the case of coal, when planning what material should be washed and how it should be assigned to products, it is common for intuition-based logic to be derived through an analysis of coal quality, washability and marketing team feedback. On several occasions, BlendOpt has been compared against rule-based systems that were being used to decide how coal should be processed and assigned to products. A simplistic depiction of a rule-based system is given in Figure 5.

Illustration of a rule-based system for processing and product decisions
Figure 5. Illustration of a rule-based system for processing and product decisions

Decisions to wash or bypass coal and allocation to product blends using a rule-based and with BlendOpt Integrated Mine Planning Optimisation
Figure 6. Decisions to wash or bypass coal and allocation to product blends using a rule-based
system (bottom panel) and BlendOpt integrated mine planning (top panel). Flow chart line thickness indicates
ROM tonnes from seam to processing and product tonnes from processing to product.

The chart on the bottom panel of Figure 6 displays results that were initially created using such a rule based system and were then further improved using Excel Solver. While optimisation using Excel Solver improved results significantly, the improvements did not greatly change product ratios, indicating a strong influence from the initial rule-based plan.

This can be contrasted with the results in the top panel of Figure 6 which were generated by BlendOpt. The BlendOpt plan has CHPP utilisation decreasing almost by 50% and revenue increasing by 6.8%. In comparison with the original plan, significant and frequent exceptions were made in the amount of coal that was washed (Figure 7) and in the products that were sold (Figure 6). For instance, BlendOpt sells 41% more tonnes of metallurgical coal compared with the original plan.

Total planned ROM tonnes washed (orange line) and bypassed (red line) in results from a rule-based system (bottom panel) and BlendOpt (top panel)
Figure 7. Total planned ROM tonnes washed (orange line) and bypassed (red line) in
results from a rule-based system (bottom panel) and BlendOpt (top panel).

Why is the integrated mine planning problem mathematically so complex?