Introduction to Panel Caving

An Introduction to Block and Panel CavingAllan Moss, General manager Rio Tinto Copper Projects

Context why the interest in caving

How block caving works and key technical considerations

Risks

Value drivers

Agenda

2BMO Capital Markets 2011 Global Metals & Mining Conference1 March 2011

Greater Depths of Mining


Trends in Mining ~ to 2013


Trends in Mining ~ after 2013


Why Caving?

Use of gravity to break the rock (instead of explosives), thus low operating cost compared with other underground methods

High production rates can be achieved allowing economies of scale

Allows high degree of mechanization

Safe

However

High initial capital costs

Conceptually simple let gravity do the work - but technically very challenging

Requires large design effort; high quality construction; and rigorously managed operations



Cave Mining ~ When is it Applicable?

Orebodies with a substantial vertical dimension; massive or pipe like

Rock strength not a limitation but need sufficient orebody dimensions

Primarily used in copper mining but also molybdenum and diamonds,

020000

40000

60000

80000

100000

120000

140000

160000

1880 1900 1920 1940 1960 1980 2000 2020 2040YEAR

T

O

N

N

E

S

P

E

R

D

A

Y

Climax

Salvador

Kiruna

Mount Isa

San Manuel

MiamiRidgeway

Olympic DamAndina

Freeport IOZ/DOZ

Henderson

MalmbergetPalabora

PremierKidd Creek

1000m

2000m

3000m

4000m

Pala

bora

Hen

ders

on

Kid

d C

reek

Wes

tern

Dee

ps

Hom

esta

ke -

S D

akot

a

Mag

ma

Evolution of daily production rates

(after Brown 2004a)

New generation Caves; under construction

Conventional underground

Open pits Super caves


Modernisation of an Old Method

Grizzley Block CaveLHD Block Cave


With Increasing Production comes need for Size

HendersonDOZ

San Manuel PalaboraParkes PremierPerseveranceQuesta

Oyu Tolgoi Resolution


Note: size is for illustrative purpose only and has been sourced from published informationExploited resource

Unexploited resource

Waste

Caved waste

Major block and panel cave mines

Rio TintoPlannedCurrently operatingClosed mines


Rio Tinto a leader in cave mining

Involved in 5 block caves in operation or development

Applying experience from operating mines to developing next generation block cave mines

Advancing technology and innovation in block cave mining

Building an Underground Technology Centre to ensure objectives are met, particularly with regard to people




Risks

Value drivers

Agenda


Where Does Caving fit in the Spectrum of Underground?

Method T / Manshift Avg. T / Day Relative Operating Cost per tonne

Resuing 0.2 - 0.5 50 - 100+ 70+

Cut and Fill 12 - 48 500 1,500 20 to 70

Shrinkage 20 - 28 200 - 800 20 to 50

Room and Pillar 15 - 150 1,500 10,000 7 to 20

Open Stoping 20 - 115 1,500 25,000 7 to 25

Sub-level Caving 65 - 180 1,500 50,000 7 to 17

Block Caving 300 - 2000 10,000 100,000 1 to 2.5

Underground mining methods modified from Brown, 2003


Five Key Components of a Cave Mine

Orebody access Shafts Tunnels

Undercutting The level where caving is initiated

Extraction Where ore is removed from the broken rock

Ore flow Sizing and transfer of ore to surface

Infrastructure Support systems, ventilation, power, water, supplies, men


Haulage Level

Exhaust Level

Ore PassVent Raise

OrebodyExtraction Level

Undercut Level

Block Cave Concept

Production tunnels

Haulagesystem

Crushed Ore

ShaftOre body

Plant

Draw bells


1. Develop undercut level2. Develop production tunnels

3. Drill and blast undercut rings4. Open troughs

Progressive spalling

Caving Process

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20

25 35

Block cave mining is based on the principle that, once a sufficiently large area of a block has been undercut by drilling and blasting, the overlying block of ore will start to cave under the influence of gravity.

The process will continue until caving propagates through the entire block to surface or to the open pit above


Extraction

Undercut

Caved Ground

LHDLoading

What are we trying to achieve?


CAPITAL INVESTMENT

Block Caving Concept

VALUE REALIZATION

100%

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0

0

7

$

TIME

CAVEDYNAMICSSOURCESOFUNCERTAINTY

CAVEMANAGEMENT19BMO Capital Markets 2011 Global Metals & Mining Conference1 March 2011

Section Through Cave


Key Technical Issues


cave propagation

cave fragmentation

cave flow

Critical dimensions to initiate caving


Geometry of drawbells

DRAWBELLS


Fragmentation: the key to a successful operation


Impacts of Fragmentation

IMPLICATIONS ON RESOURCE RECOVERY

PRODUCTIVITY

VALUE AT RISK

SECONDARY BLASTING


Caving the block

Secondary Fragmentation

Primary Fragmentation

FlowInterruptionIndex(events/tonsx1000)

Initialsecondaryfragmentation

Blastingeffect

Secondaryfragmentation

Blastedundercutmaterial

HoD

Index of Interruptions Frequency (Salvador mine, draw point 04W20)


Rock Structure and fragmentation


zone of loosening

expansion void

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a

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n

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s

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)

fragment sizeevolution with draw

higher mobility of finerfragments within a draw column

IDZ

Primary fragmentation

Secondary fragmentation

Fragmentation is complex: risks!!!

Fine material

Coarse material


Cave Flow

W

a

s

t

e

E

n

t

r

y

H

o

D

waste

ore

IDZ ~ Ellipsoid of Motion (extracted blocks)

Zone of Loosening (blocks that were displaced vertically at least once)

oreore

o

r

e

w

a

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w

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e


Flow dictates Revenue Stream

CAVED OREUNCAVED

ORE

EXTRACTED ORE

WASTE ENTRY

RILLING and MASS FLOW PREDOMINATLY MASS FLOW

elliptical or frustumshaped IEZ;height equivalent to~100-200 mean fragment size

cylindrical IEZ

WASTE ROCK


WASTE ROCK WASTE ROCK

ORE BODY

Vyazmensky 2008Vyazmensky 2008

DilutionentryHighgradeore

TIME

$

What do we draw?- the recovery issue


REPEAT

WASTE ROCK WASTE ROCK

ORE BODY

Vyazmensky 2008Vyazmensky 2008

Dilutionentry

TIME

$


Highgradeore

What do we draw?- the recovery issue

Rings to be blasted

Blasted undercut rings

CAVED ORE

UNCAVED ORE

Undercutting


Purpose of the Extraction Level

ACCESS TO ORE ABOVEALLOW DEVELOPMENT OF DRAWBELLS


Light at the End of the Tunnel


A video of some of the concepts outlined can be found http://www.argylediamonds.com.au/video_block_cave.html



Risks

Value drivers

Agenda


Cant define risk - Cant define value

Complete knowledge of the future is an impossibility The question then becomes how representative is

the information we have on hand?

This information is used to develop a robust enough plan to cater for the inherent uncertainty.

Uncertainty translates to risk (Flexibility costs money)

Block caving is not for marginal projects


Differences in Knowledgetherefore differences in Uncertainty

Initiation point close to surface Substantial informationNo geotechnical constraints

Initiation point remote from surface Limited information Substantial geotechnical constraints

Ore drilled and typically sampled as part of mining process detailed knowledge for short term planning

Limited knowledge of ore- sampling after the fact


Scale


GBT Area I & II

IOZ

DOZ

GBT Area I & II

IOZ

DOZ

Access and Extraction Complexity

Escondida, Chile

DOZ Mine Freeport, Indonesia


Courtesy of PTFI

Control

OPENPITMINING CAVEMINING

goodcontrol

morecertainty

limitedcontrol

uncertainty

reducedknowledge

wellestablishedmethod

BETTERTECHNOLOGYISAKEYTOBETTERVALUE


Risk

42BMO Capital Markets 2011 Global Metals & Mining Conference

Characterisation the resource; understanding the size of the prize

Design resource to reserve; time for imagination

Construction the big spend and first taste of reality

Operation recovery and payback

CONCRETEDAMAGE

CONCRETEDAMAGE

1,5 m

Paper (Design) Value vs. Actual Value

1 March 2011

Mine

infrastructure

Surface subsidence

Lesson learned at Palabora

dilution of the ore reserve andsubsequent reduction in life of mine

43BMO Capital Markets 2011 Global Metals & Mining Conference

Palaborasuccessfully transitioned from an open pit to a 30,000 tpd underground block cave but.

1 March 2011



Risks

Value drivers

Agenda

1 March 2011 BMO Capital Markets 2011 Global Metals & Mining Conference 44

BMO Capital Markets 2011 Global Metals & Mining Conference 45

Ore grade and value

Value is a function of Run of Mine (ROM) grade which is an

outcome of three inter-related factors

1. The resource grade; a measure of the metal that is in the ground

2. The reserve grade, a measure of the effectiveness of the design

3. The recovered grade, a measure of how the cave is managed and cave dynamics

1 March 2011

Indicative Costs


The capital and operating costs shown are relative and provide an indication of the spread. Both green field and brown field projects are included as are operations where access is via shaft or by decline. They were developed simply by normalising to lowest cost producers in terms of capital and operating cost.

Capital

Operating

How Soon do you Get your Money Back?


Realising Value

New generation of Cave Mines

represent a step change in the size of operations require investment levels of $2 to 10 billion and require significant time to achieve operating targets

There are value drivers common to any mining project:1. Costs (capital and operating)2. Revenue3. Time


Cave dynamics Block caving is inflexible and value

locked in at the design phase Important to understand cave

behaviour and reliably forecast metal production (tons and grade)

Intelligent Mining Autonomous equipment Block cave operations well suited to

concept of intelligent mining; real time information

Operating efficiencies

Mine of the Future

Investment in technology and innovation to drive value


Investment in technology and innovation to drive value

Rapid development Tunnelling concepts that are more

productive and cost effective than traditional methods

Integrated shaft boring machinery with the potentialto dramatically improve safety while reducing construction time

Optimised design and management Building on ability to predict cave

behaviour Improved planning techniques and

software to improve grade sequencing


The Vision an Ore Factory

RequiredFragmentator

ReliableOre Flow

Predictable Fragmentation(+ grade)

The Rock Factory

Ore Transportand Sizing

FragmentSize

Energy(Distance Traveled)

In Situ

Crushing and Grinding


The Ore Factory

Thank You

Allan Moss, General manager Rio Tinto Copper Projects

Introduction to Panel Caving

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