Basic Planning Process for Opencast Mining

BASIC PLANNING PROCESS

The planning process can be divided into many phases out of which the followings are worth to mention:

1.Business Assessment

It should be done for gathering facts and forecasts in order to assess the company's current position, prospects,opportunities and threats. Under this heading assessing of companies performances, external environment, stake holders expectations are the most important criteria. The purpose of this phase is to reach conclusions on the company's positionand prospects which are essential prerequisites to making sound planning decisions.

Assessment of the company's performance, strengths and limitations mainly cover up profitability, growth w.r.t. industry and competition, marketing for selling end products under the environment of steep competition. ore reserves for present inventory and development potential capital structure and financing capability. human resources. productivity in mining and ore processing plants, etc. Assessment of external environment (includes resource reserves and financial strength of direct competitors, national and international economic conditions, projected changes, impact on demand etc) developing technology and the introduction of substitutions, future capital availability and cost. possible legislation in areas such as taxation and environment control etc. Assessment of the expectations of stakeholders (covers up expectations of shareholders for growth, stability of earnings, and dividends), joint venture partners expectation (for investment in exploration), expectation of management (in terms of challenge, personal development and growth in compensation), expectation of workers (for job security, good working condition, etc), expectations of customers (in terms of certainty of supply, prices, quality and deliveries in time), expectations of creditors (in terms of terms, conditions and ability to pay), expectations of government (regarding output, local processing, employment, environment control, local equity participation), etc.

2. Strategic Planning

It is meant for determining the grand design of the enterprise and the allocation of resources to opportunities. The strategic planning covers up the development of business mission, formulation of business policy and objectives, evaluation of alternatives and opportunities, development of strategies and allocation of resources.

Developing the business mission starts with the examination of internal strengths and weaknesses and external threats and opportunities. A mining company should consider developing objectives and policies on the topics viz. profitability (corporate return on assets employed, return on investment required to justify property development, mujor capital projects and joint ventures, return on equity, debt service coverage, asset turnover, return on sales, etc), financial resources (control of ownership, debt to equity ratio, dividend payout/earnings retention, earnings per share growth).

physical resources (exploration policy, joint ownership alternatives. development policy regarding established reserves. exploitation policy etc.).market position (domestic and international markets, long term contract, etc). human resource development (manager performance and development, worker performance and attitude, working condition and safety. etc), public responsibility (conservation of resources, environmental pollution, employment policy etc), productivity (higher output and cost reduction) etc.

3. Operational Planning

Once the strategic plan has been completed more detailed planning is essential. Operational planning provides an essential link between strategic and annual planning. The operational planning includes organization (for deciding the organization structure appropriate to the strategy selected, and then segmenting and delegating the strategic plan to the prime organizational units for execution. It involves defining each unit's mission, the scope of its activities and constraints and critical relationships with other units), formulation of unit policies and objectives (developing alternative ways to achieving objectives and implementing policies, selecting actions, setting priorities, and deciding the interrelationship and timing of moves), preparing an integrated action plan, etc. In the mining industry formulation of unit policies and objectives are of great importance. It is at this stage that critical timing decisions are made that will affect resource development and exploitation schedules impacting on the ultimate profitability of the mining operations.

After this an integrated action plan is prepared after integration of all unit plans. This is facilitated by converting plans into quantitative and monetary terms. Projected financial statements for every year of the planning stage should be prepared. Thereafter more detailed short-term plans should be made. These address the results to be achieved and actions to be taken within the next fiscal year and should identify the contribution that each unit and manager is committed to achieve. Priorities for management action in the coming year should focus on those tasks which will have higher influence on accomplishing the goals set forth in the long-range plan. The annual budget should be based on performance standards. The standards mean the standards of time and method, material usage, inventory turnover, collections, and so on. Thus, the budget reflects the strategic plans for the year according to cost of input under efficient operating conditions and reflecting realistic outputs or results..

4. Production Planning

A production plan is a statement of production goals based on forecasts of demand and resources availability that consciously attempts to manage employment and inventory levels to attain organizational objectives. Master schedule is the high level schedule that translates the production plan into scientific product terms by specifying what end product or product modules are to be produced and time periods during which they are to be made. It is the nerve centre of the planning activities. Production planning and control is the staff activities.

During any production planning the basic objectives should be directed to minimize cost of production in any time frame, 

* to maintain the operation viable according to the plan by the planned supplied equipment and the operation site.

*  to ensure that a planned tonnage within the required grade production is achieved, to develop a realistic but flexible schedule with the aid of factors like stripping requirement manpower employment and training, equipment deployment, infrastructure and logistical supports without taking any risk of delaying, etc..

* to design pit slope at a maximum angle after taking due consideration of geotechnical parameters and pit slope stability to examine critically the effects of alternative ore production rate with different cut-off grade,

* to do the contingency planning for the strategy for future requirement, etc.

5. Short range production planning

It is necessary for running of an operating mine. It usually refers to the specific production plans for the next day week, or perhaps months. Production control has prime responsibility for controlling the work loads in the mine ur on the plant. Production control has the responsibility on ensuring that all raw materials supplies and Heavy Earth Moving Machinery (HEMM) are available in the right place at the right time in the faces of the opencast mine. It also ensures that the correct number of workers with appropriate skills have been deployed at the right time. Where any customer instructions are required to perform the job for the sake of quantity and quality of the raw material, production control must make sure that they are available. It must assign jobs to work centers / production faces and schedule the use of major equipment. It is necessary for decision making process, feasibility and budget studies. In long range production planning. the problem becomes more complex. What is mined in one period affects what is available to mine in the next and each mining decision initiates a chain of consequences that can have significant impact on the viability of the overall project. Inappropriate decisions could lead to certain periods in the future where no optimum coal/ore can be produced.

6. Long range production planning.

Targeting maximum Net Present Value (NPV), optimal plans that meet a variety of defined constraints can be generated and evaluated. Different market cost and grade scenarios may be simulated, enabling planners to determine mining sequences which not only maximize NPV but are also very stable in terms of sensitivity to parameters which are likely us vary. 

The advantages of long term planning are as follows:

1. Schedule with a high degree of certainty of output.

2. Develop operational strategies to improve the short and long term consistency of output 

3. Determine a schedule which maximizes NPV within the defined parameters and constraints. 

4. Develop a "market-driven operational plan" rather than a "a mining driven marketing plan".

5. Review ultimate pit designs and reserves.

6. Evaluate a wide range of alternatives e.g. capital investments, mining contracts, alternative product mixes. transportation modes,ete and re-optimize the long term mining schedule for each scenario being considered.

7. Respond to changes in the market, operations, corporate priorities and new opportunities.

7. Aggregate planning

It consists of efforts to plan a desired output over the longer range by adjusting the production rate, employment inventory and other controllable variables. These controllable variables in effect constitute pure strategies by which fluctuations in demand and uncertainties in production activities can be accommodated.