Context

Our client, the operator of a well-run open-pit gold mine in West Africa, was under pressure from the market to further reduce unit costs. The bottleneck at the site was the primary crusher, although this would soon be compounded by the mining strategy shifting from bulk mining at relatively low strip ratios to a more selective mining strategy, requiring an 18% increase in mining output. PIP was engaged to complete a diagnostic to:

  • Establish how much unit cost improvement was possible
  • Determine the main areas of the operation to be targeted in order to deliver the improvement
  • Formulate an implementation ‘roadmap’ specifying what it would take to deliver the improvement

Client achieved

  • A list of prioritised improvement opportunities worth $30-40m p.a. (equivalent to a reduction in 6-8% of unit cost) across three main areas:
    • $12-18m p.a. by increasing processing plant throughput through improved primary crusher and mill utilisation
    • 10% mining throughput improvement by increasing direct operating hours and shovel productivity resulting in head grade improvements worth $9m p.a.
    • $7-12m p.a. in cost reductions:
      • Reducing procured spend by $6-10m p.a. through rapid and strategic sourcing interventions
      • $1-2m p.a. through fuel and reagent usage reduction opportunities

The Results