In many of the past mining studies that I have worked, stockpiling strategies were discussed and eventually implemented. Sometimes study team members were surprised at the size of the stockpiles that were generated by the production plan. It became apparent that not all members of the team were clear on the purpose of the stockpiling strategy or else they had preconceived ideas on the rationale. To them stockpiling may have seemed to be a good idea until they saw it in action.
Mine Stockpile
In this blog I won’t go into all the costs and environmental issues associated with stockpile operation but will focus simply on the reasons for stockpiling and why stockpiles may get large or numerous .
In my experience there are four main reasons why stockpiling might be done at an operation. They are:
1. Campaigning: For metallurgical reasons, there may be certain ore type(s) that can cause process difficulties if mixed in with other ores. Therefore the problematic ore(s) might be stockpiled until sufficient inventory is built up until it makes sense to process that ore (i.e. campaign) through the mill. Such stockpiles will only grow as large as the operator allows them to, before processing the material and eliminating the stockpile. Be aware that if the mine operations are still delivering different ore types to the crusher area, then those ores may need to be stockpiled during the campaigning period.  More different ore types may mean more stockpiles.
2. Grade Maximization: This stockpiling approach is used in situations where the mine delivers more ore than is required by the plant, thereby allowing the best material to be processed directly and the lower grade material to be stockpiled for a future date. Possibly one or more low grade stockpiles may be used, for example a low grade and a medium-low grade stockpile. Such stockpiles may not be processed for years, possibly remaining in place until the mine is depleted or until the mined head grades are lower than those in the stockpile. Such stockpiles can grow to enormous size if accumulated over many years.
3. Surge Control: stockpiling may be used in cases where the mine may have a fluctuating ore delivery rate and on some days excess ore is produced while other days there is underproduction. The stockpile is simply used to make up the difference and provide a steady primary crusher feed rate. These stockpiles are also available as short term emergency feed if for some reason the mine is shut down (e.g. extreme weather). In general such stockpiles may be relatively small in size since they are mainly used for operational surge control.
4. Blending: blending stockpiles may be used where a processing plant needs a certain quality of feed material with respect to head grade or contaminant ratios (silica, iron, etc.). Blending stockpiles enables the operator to ensure the plant feed quality to be consistent and uniform. Such stockpiles may not be large individually; however there could be several of them depending on the orebody character.
There may be other stockpiling strategies beyond the four listed above but those four capture the bulk of the situations.
Using today’s automated production scheduling software, one can test multiple stockpiling strategies by applying different cutoff grades or using multiple grade stockpiles. The scheduling software will have algorithms to determine whether one should be adding to the stockpile or drawing from it. It will track the grades in the stockpile and sometimes be able to model stockpile balances assuming reclaim by average grade, or first in-first out (FIFO), or last in-first out (LIFO).
Stockpiling in most cases will provide some potential benefits to an operation and the project economics. Even if metallurgical blending or campaigning is not required, one should always test the production schedule and project economics with a few grade stockpiling scenarios. Unfortunately these are not simple to undertake when using a manual scheduling approach and so are another reason to move towards automated scheduling software. Also make sure everyone on the team understands the rationale for the stockpiling strategy and what the stockpiles might ultimately look like. They might be surprised.
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3 thoughts on “53. Ore Stockpiling – Why are we doing this again?

  1. hardrockminer

    Whittle allows you to play with stockpiles, although I confess that I haven’t used that option very much. It’s a good tool though.

    If you chart NPV against cut-off you will get a curve with a peak NPV value at a unique mill cut-off. NPV will fall as the cut-off rises (or falls) from that value. The cut-off value chosen is the optimum for that particular pit shell, which presumably is the shell selected from the optimization run. Note that if you change any Whittle input parameters you may change the cut-off at which NPV peaks. (Try changing the discount rate to see what happens.)

    There are some common stockpile pitfalls that the planner should consider.

    1) Will the stockpile oxidize over time? If so how will this affect recovery?
    2) What recovery factor should be used for fresh stockpile? Should it be the same as for run of mill ore? Most planners use the same number.
    3) Is the stockpile grade tested or is is just a mathematical calculation at month end reconciliation? If the latter then you may get an unpleasant surprise when it comes time to mill the stockpile.
    4) How is the stockpile treated for accounting purposes? Usually it shows up as an asset on the balance sheet and costs are removed from operating costs until the material goes to the mill. In any financial analysis one must consider the discounted cost of the “investment” in the stockpile and factor this into the economics.

  2. Ken Kuchling Post author

    Good points. There is often more to proper stockpile operation than meets the eye. Degradation and water infiltration can cause handling difficulties, as well as the processibility changes that you mentioned, acid runoff etc, so one needs to understand what happens to that material as it sits long term. Then there is the issue if you don’t process it at the end and leave it as permanent dump, were environmental mitigations taken into account in its original design.

  3. hardrockminer

    Here in BC the amount of the closure security will increase according to the cost of disposing (or treating) of the stockpile if the stockpile is PAG.

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