With a push for productivity improvement and cost reduction across the resource sector, simulation modelling has come under the spotlight as a method to help reach that goal. Previously used as a support tool, some resource companies are starting to drive modelling in new holistic and strategic directions.
The big players in the market are exploring programmes that align various parts of the business. One example is Rio Tinto’s ‘Integrated Value Chain Engagement Project’, which focuses on modelling to support integrated value chain analysis (running scenarios and establishing sensitivities throughout the whole process) and supports expansion projects (giving expected outcomes and establishing red flag areas).
Jacob Rousseau, Simulation Engineer at Rio Tinto explains: “Our medium term mine planners go out and put together a mine plan for a site. We’ll then create a map of the site and analyse how it’s going to operate for the first 12 months. Essentially, we add their plans into our models and play it through – we can easily highlight potential flaws or problems which gives us a clear picture of the next year.”
This process acts as decision support, identifying the best approach for bottlenecks as mine engineers and managers might have different ideas on how to unlock value from the process. Simulation modelling enables mine sites to test each solution through the system.
As the decade-long mining expansion is starting to slow down, the emphasis on scenario testing has turned to upcoming projects and ensuring a streamlined operation.
“We’ve all heard the two buzz words; productivity improvement and cost reduction. We have a lot of projects that are still set to be built so we’re really focusing on how they can be more productive and improve output over input.
“Modelling allows us to look at where we can make improvements to each process, so if I have a truck, how can I get that truck to give me a little bit more stuff without buying another truck; or at this process plant, how can I make more use of the time that we don’t use the plant and maybe use it better etc.. There are improvement initiatives happening across most of the business units, especially in iron ore.”
In addition to value chain process improvements, there are some real cost savings to be made from modelling. One of the positives of running such a large operation with a number of people involved is the pool of experts with cost reduction ideas. Jacob talked me through a few areas where results are tangibly recognised:
“One of the engineers might have the idea to extend the load on a truck for example, going back and forwards to a crusher. We can check if it’s going to save more time or if actually it’s better to under-load that truck to get it moving quicker and conduct a faster turnaround., Will there be queuing problems? We’ll have scenario results from all possible options.
“The other thing is debottlenecking. During modelling studies we look at our whole process, identify a bottleneck, and in the model remember the bottleneck, play it again and see where the next bottleneck is. You build up to the target to where you need to be.
“People aren’t currently always seeing the true bottleneck; you have to understand the wider cost drivers of a process, even beyond your mine because that’s also being missed and sometimes misinterpreted.”
With these clear benefits in mind, I started to explore some of the key challenges faced to establish what’s holding up resource companies from fully utilising simulation modelling.
The main and arguably most long standing obstacle is gaining the acceptance of modelling in the first place. There’s no doubt the resource sector has gone through leaps and bounds integrating technology over the last ten years; newer generations coming into management have driven automation into daily operations. However, all technology comes at a cost, and it needs to prove its worth.
It’s an area where Jacob has experience getting people on board: “You really have to go in and sell it, be confident that it’s going to give you the best answers and give you long term value going forward. You have to build the capability within the organisation too. When I started six years ago, it was just me – we now have a team of six and it’s still expanding.”
There’s still a long way to go, and a lot still to be learnt if widespread efficiencies are going to be made across the sector. Jacob’s been in the industry for many years now and explains how there’s still big scope to expand: “All the mining houses could be utilising this technology more than they currently do, it’s still in its infancy. As soon as more people realise how to use even the more simple tools, taking this holistic approach to the whole process can make significant improvements.”
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