Geostatistical simulation for open PIT design optimization and mine economic analysis in decision-making

In this study, an Iron Ore deposit which lies within the Marampa schist formation located in Sierra Leone, that hosts a primary quartz-hematite schist horizon with thickness of up to 65m, was used for eventual block estimation, grade uncertainty characterization and final pit outline design. Additionally, economic sensitivity analysis was done to determine how sensitive the investment will be to certain economic variable changes such as metal price, refining cost, operating cost and other economic parameters that are not known with certainty. The new concept for final pit shape in open pit mine design namely Best Positive Inverted Truncated Cone (BPITC) algorithm is applied in optimizing the pit shape. The optimization results obtained showed that BPITC can always produce optimal solutions for final pit designs and it gives effective information on mineral project decision-making and mining sequencing. The kriging and simulation algorithms revenue evaluation showed nearly the same optimal values at the same cut-off grade. Finally, all the information which can be obtained once drilling has started and in making decisions whether or not to develop the mineral deposit through geo-statistical analysis using GSLIB was shown.