Abstract
Short-term production plans are the basis for operational mine production schedules. They concentrate on making long-term mine plans operationally feasible. It ensures a steady flow of product for meeting blending targets. Due to the quality variation of material, blend optimization is an uncertainty based optimization problem. There are different approaches toward uncertainty management and the current paper investigates a portfolio optimization model in order to minimize the risks in short-term plans. In this paper, a fuzzy linear programming model is formulated to provide a set of options for the mine plan. These blending options are treated as portfolios. Then a model for the optimal selection of a portfolio is introduced. The objective of the model is to maximize the expected return of the portfolio under constraints limiting its variance. The model is applied in a limestone mine complex.
Highlights
The strategic mine plan sets the overall objectives of a mining project
This paper addresses short-term planning in open pit mines
The problem of short-term production scheduling is investigated as a portfolio optimization problem
Summary
The strategic mine plan sets the overall objectives of a mining project. Mine planning is a multidisciplinary act and its aim is to develop the yearly extraction plan to meet some predefined goals (Morley et al 1999; Dagdelen 2007). Mine-plans are classified into long-term, medium, short-term, and operational plans These plans are organized such that the mining operation leads to the highest cash flow or net present value (Juarez et al 2014; King 2014). The simplest approach to manage and overcome uncertainties is to overdesign or over-plan In this approach, excess capacity of those specified in the long-term plan is executed, so that the operation can survive possible changes in the future. Eivazy and Askari-Nasab (2012) presented a model for short-term production scheduling (i.e. monthly plans), that aims to minimize mining costs while satisfying quality requirements Souza et al (2010) developed a hybrid heuristic algorithm for truck allocation in a multi pit iron-ore mine site to meet a recommended mining rate, while satisfying the quality requirements in order to minimize operating costs. Asad (2011) developed a heuristic approach for short-range production scheduling in a quarry. Eivazy and Askari-Nasab (2012) presented a model for short-term production scheduling (i.e. monthly plans), that aims to minimize mining costs while satisfying quality requirements
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