Mining and Resource Geology Symposium

Reconciliation: importance of good sampling and data QAQC

Mark Nopp Director and Principal Consultant Geologist Snowden Mining Industry Consultants Pty Ltd PO Box 2207 Brisbane Queensland 4001 Australia Abstract Consider the following statements (Harry and Schroeder, 2000): You dont know what you dont know You dont measure what you dont value You cant value what you dont measure If you cant measure it you cant control it If you cant control it you cant improve it

These comments about business and operational control are very applicable to mine reconciliation, and particularly the input sampling estimates and measurements. Understanding, quantifying, controlling and correctly reporting these results is an integral part of successfully monitoring the performance of the mining operation. Introduction Mining reconciliation is the comparison of estimated tonnage, grade and metal with actual measurements. The aims are to measure the performance of the operation, support the calculation of the mineral asset, validate the Mineral Resource and Ore Reserve estimates, and provide key performance indicators for short and long-term control (Morley, 2003). Ongoing, regular and efficient reconciliation should also highlight improvement opportunities and allow for proactive short-term forecasting by providing reliable calibrations to critical estimates. The concept is that of measure, control and improve. Meaningful reconciliation Many operations have a reconciliation process in place, although most function on (or are only reliable) on a long-term basis often because of the time and effort to collate and report the data from disparate databases across multiple function areas. The aim should be to minimize multiple handling of the data, with a centralised reporting platform, an example of which is outlined in Figure 1. Operators often overlook the volume-variance effect namely that the larger the tonnage or time increment that is examined the less variable the results will be. The time period over which the reconciliation is reported is important to ensure that the results are meaningful and have the desired level of associated confidence.

XYZ, EGRU Contribution No 62, 2004

Mining and Resource Geology Symposium

Figure 1 Schematic illustration of a reconciliation system (after Morley, 2003) The usefulness of the reconciliation data, however, remains dependent on the quality and reliability of the input data, namely the estimates and the measurements. The resource and reserve estimates are themselves dependent on the underlying sample data and the processes used to generate the resource and reserve estimates (including short-term grade control estimates). The mining and processing measurements include survey, belt samples, on-line analysers, weightometers and flow-meters. All of these measurements have some degree of associated error or confidence level. The key elements of a reconciliation process are summarized in Figure 1, whilst some of the variables that affect the reliability of reconciliation results are presented in Table 1.

XYZ, EGRU Contribution No 62, 2004

Mining and Resource Geology Symposium

Figure 1 Schematic illustration of the mining reconciliation process and key issues for analysis (after Morley, 2003)
Geological model causes True in situ nugget effect Sampling and subsampling errors Analytical errors Estimation errors Excessive rejection of outliers Estimation methodology issues Ore density assumptions Definition of ore boundaries Grade control causes In situ nugget effect Sampling and subsampling errors Analytical errors Blast holes parallel to mineralisation Averaging or Kriging methodology issues Ore grade contouring Survey inaccuracies Mining causes Mining model parallel to cross mineralisation in open pit Displacement of mineralization boundaries upon blasting Survey inaccuracies Truck dispatch inaccuracies Loss of fines Estimation of tonnes Dilution Mill and flotation plant causes Retention of metal within the Mill Analytical inaccuracy Process cycles either unknown or misunderstood Calibration of weightometers and flowmeters Poor laboratory subsampling Reconciliation calculated over too short a timeframe

Table 1 Examples of variables that affect the reliability of reconciliation results (after Pitard, 2001)

XYZ, EGRU Contribution No 62, 2004

Mining and Resource Geology Symposium

Sample Data It is important to remember that we are making use of relatively small and infrequent samples to estimate the actual, but unknown, characteristics of the entire population, and any uncertainty in the sample data will affect our ability to draw the right conclusions. The reliability of the sample results is dependent on the characteristics of the mineralization and the quality of the sampling, sample preparation and assaying. Sample reliability can be assessed through the variability in the sample grades (the precision) and the accuracy (bias) in the results. Whilst sampling concerns generally focus on grades, the importance of bulk density and moisture data for tonnage estimation should not be ignored. The variability in the sample results can be broken down into three main sources: the true nugget of the mineralization (inherent heterogeneity), the sampling errors (resulting from sample selection methods and options), including sample preparation (particle size and sample size reduction); and assaying errors. It is important to understand and quantify these errors, so that the confidence of the final sample results can be reported and used in our reconciliation investigations. A classification of errors associated with a Mineral Resource estimate is summarized in Figure 2. Broken ore sample theory should be applied to control the sample preparation protocol, and can be described in a sampling nomograph (Figure 3). The nomograph plots the fundamental sample error (FSE) for various choices of sample mass and particle size for a particular operation (Sketchley, 1999).

Estimation Errors

Taking the sample

Sample Collection Error Localisation Error Materialisation Error

Kriging Error

Fundamental Sampling Error

Delimitation and Extraction Error

Grouping and Segregation Error

Geological Errors Geostats Errors

Sampling Theory
Figure 2 Sources of Mineral Resource estimation errors (after Franois-Bongaron, 1995)

XYZ, EGRU Contribution No 62, 2004

Mining and Resource Geology Symposium

Sam pling Nom ograph 1000 100 10 1 0.1 Split 3 Split 4 Crush 3 Crush 2 10 cm 3 cm 0.5 cm 0.01 cm Process 3% 20%

Split 1 Split2 Crush 1 Lot

FSE

0.01 0.001 0.0001

0.00001 0.000001 0.0000001 0.1 1 10 100 Mass (g) 1000 10000 100000

Figure 3 Example of a four-stage sample nomograph QA-QC Once the points of measurement in the reconciliation process are defined, the measurements (particularly in the case of sampling) should include sufficient control measurements (in the form of duplicates and standards) to monitor and report on the reliability of the data (precision and accuracy). This requires the establishment of a suitable quality assurance system and quality control procedures (QA-QC). Quality assurance deals with the establishment and documentation of systems and standards to ensure quality on macro level. Quality control is the use of statistical tools and checks to ensure the systems are in statistical control on a micro level. A well-designed and implemented QA-QC system like a useful reconciliation system should not add to the workload of your already stretched technical team. The processes should be automated and be as accessible and transparent as possible so that more time can be spent on interpreting the results than on collating the data. Remember: data is not information unless it is presented in a useful way.

XYZ, EGRU Contribution No 62, 2004

Mining and Resource Geology Symposium

Policy Quality Manual Procedures Work Instructions Control Documents (forms) Evidence (records)
Figure 4 Elements of a quality control system The cost of poor quality The significant cost of poor procedures is often overlooked. If you ask someone how much money (time) is lost if something is carried out incorrectly, their first reaction will be double the cost. However, research has shown that the total cost ranges from 8 to 14 times the original cost when something has to be done a second time (Harry and Schroeder, 2000). This is perhaps one of the most dramatic, and often unrecognised, sources of operation improvement in businesses today, and the impact on a companys profitability can be considerable. An example of this in mine reconciliation is the inappropriate reaction to the measurement results and the pursuit of meaningless and time-consuming witch hunts when these are not warranted. Conclusion If you cant measure it, you cant control it, and if you cant control it how do you hope to improve it? The short and long-term benefits of a meaningful and efficient reconciliation system to the success of any mining operation should be obvious. The message is: dont delay, get your system up and running today! References Franois-Bongaron, D. M, 1995. Sampling in the mineral industry, theory and practical. Course notes. Harry M and Schroeder R, 2000. Six Sigma: The Breakthrough Management Strategy Revolutionizing the Worlds Top Corporations, published by Doubleday a division of Random House Inc. 1540 Broadway, New York, New York 10036. Morley, C, 2003. Beyond Reconciliation a pro-active Approach to Using Mining Data. Fifth Large Open Pit Mining Conference, Kalgoorlie, WA, 3-5 November, 2003, 185-191. Pitard, F, 2001. A Strategy to minimise ore grade reconciliation problems between the mine and the mill, in Mineral Resource and Ore Reserve Estimation The AusIMM Guide to Good Practice (Ed:A C Edwards), pp 557-566 (The Australasian Institute of Mining and Metallurgy: Melbourne).

XYZ, EGRU Contribution No 62, 2004

Mining and Resource Geology Symposium

Sketchley, D A, 1999. Gold deposits: establishing sampling protocols and monitoring quality control. Explor. Mining Geol., Vol 7, Nos 1 and 2, Canadian Institute of Mining, Metallurgy and Petroleum, pp 129-138.

Mark Nopp is a Director of Snowden Mining Industry Consultants Pty Limited (Australia) and Manager of Brisbane office. He has more than 17 years experience in exploration, mining geology, mineral resource estimation and management gained with Anglo American and Snowden. Mark has a wide range of geological expertise, ranging from technical review, due diligence, sampling and reconciliation, resource estimation, and feasibility studies, to training and facilitation. Mark's experience covers a range of commodities in a variety of geological and geographic locations, including: coal; gold; sulphide and laterite nickel; copper, cobalt, zinc and lead; bauxite, phosphate and potash; PGE and diamonds in Africa, UK, Middle East, Central Asia, CIS, Indonesia and Australia.

XYZ, EGRU Contribution No 62, 2004