SIMO CASE STUDY GEOVIA USER CONFERENCE PERTH CHRIS JAMES 31 MAY 2018
2 [GEOVIA: SIMO] [May 2018]
WHAT IS VALUE Important to understand potential levers that drive value Value What is it? NPV IRR Payback Max Negative Positive Cash Flow Reserves / Resources Other? All or none? 3 [GEOVIA: SIMO] [May 2018]
AGENDA 1. Project History 2. Base Case (Milawa) and SIMO 3. Results and Learnings 4 [GEOVIA: SIMO] [May 2018]
HISTORY Massive low grade deposit, has to be large scale Previous studies large scale, large volumes (+23Mtpa), capital intensive Resulted in marginal economics Previous small scale studies did not offer good economics do we understand why? 5 [GEOVIA: SIMO] [May 2018]
WHAT DID WE DO DIFFERENT Marginal economics, unaffordability led to rethink Challenged beliefs to see if opportunity exists for smaller scale with strong economics change in mining optimisation methodology 6 [GEOVIA: SIMO] [May 2018]
WHAT DID WE DO DIFFERENT AIM TO INCREASE VALUE Geology Costs OPEX CAPEX - Mill throughput / size CAPEX - Infrastructure layout Evaluation method Milawa SIMO 7 [GEOVIA: SIMO] [May 2018]
BASE CASE (MILAWA) Generated base case with nested pit shells NPV Pushbacks 3 Pushbacks Mining Width with selected pushbacks Applied limits (mining, processing, VAR) Milawa NPV & Balanced 8 [GEOVIA: SIMO] [May 2018]
BASE CASE MILAWA SCHEDULE Three pushbacks chosen Shell selection did not have large influence on results Common high-wall 9 [GEOVIA: SIMO] [May 2018]
BASE CASE MILAWA SCHEDULE Mining Movements 30 25 20 15 10 5 0 1 3 5 7 9 11 13 15 17 19 21 Mining Movements (t) Millions 16 14 12 10 8 6 4 2 0 10 [GEOVIA: SIMO] [May 2018] waste tonne tonne input 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 Milled Tonnes (t) Millions Feed Grade (g/t) Milled Tonnes Relatively smooth mining profile 15Mtpa mill throughput Mining capped at ~25 Mtpa
SIMO USED TO INCREASE VALUE Schedule (Mining Rates and Pushback Sequencing) Cut-off Grades (Grade streaming / High grading) Used SIMO Stockpiles 11 [GEOVIA: SIMO] [May 2018]
HOW DID SIMO ADD VALUE SIMO optimises all of these levers simultaneously Split out to show incremental value 12 [GEOVIA: SIMO] [May 2018]
SCHEDULE MINING RATES Milawa Balanced schedule up to ~25 Mtpa Incrementally expanded mining capacity by adding additional fully utilised fleet Used 54 Mtpa (combination of value, fleet selection and practicality) 114% 112% 110% 108% 106% 104% 102% 100% 98% 96% Milawa (~25Mt) Mining Limit and NPV 25Mtpa 27Mtpa 36Mtpa 45Mtpa 54Mtpa 63Mtpa 13 [GEOVIA: SIMO] [May 2018]
CUT OFF GRADES Blend Bins and NPV Milawa works with economic cut-off grade and feeds all above 120% 115% SIMO groups into defined blend bins, and feeds to gain best value and stockpiles material of future value 110% 105% Started with large number bins, and refined to 5 bins 100% P 1 P 2 P 3 P 4 P 5 P 6 P 7 P 8 P 9 P 10 P 11 P 12 P 13 P 14 P 15 Bin 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 2 0 0 0 0 0 191,260 1,601,526 341,930 1,254,932 0 0 0 0 0 0 Bin 3 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 6 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 7 0 0 0 0 0 0 0 0 0 0 0 0 0 21,290 0 Bin 8 0 0 0 0 0 0 0 0 0 0 0 0 0 11,465 843,148 Bin 9 0 0 0 0 0 0 0 0 0 0 0 0 0 201,563 0 Bin 10 0 0 0 0 0 0 0 0 0 0 0 0 0 21,290 13,185 Bin 11 0 0 0 0 0 0 0 0 0 0 0 0 0 1,404,829 1,056,558 Bin 12 0 0 0 0 0 0 0 0 0 0 0 0 0 212,551 0 Bin 13 0 0 0 0 0 0 0 0 0 0 0 0 0 6,641,031 0 Bin 14 0 0 0 0 0 0 0 0 0 0 0 0 3,579,788 827,884 0 Bin 15 0 0 0 0 0 0 0 0 0 0 0 0 4,004,515 5,892,415 0 Bin 16 0 0 0 0 0 0 0 0 0 136,245 1,727,250 0 5,406,348 0 0 Bin 17 0 0 0 0 0 0 0 0 0 730,693 231,068 13,185 96,458 0 0 Bin 18 0 0 0 0 0 0 0 0 0 160,776 0 0 0 0 0 Bin 19 0 0 0 0 0 0 806,926 0 0 455,084 0 0 0 0 0 Bin 20 0 0 0 0 614,120 16,847 123,754 2,111,433 0 0 0 0 0 0 0 Bin 21 0 0 0 0 231,688 104,626 30,425 0 0 0 0 0 0 0 0 Bin 22 0 0 0 146,417 76,993 1,353,089 0 0 0 0 0 0 0 0 0 Bin 23 0 0 0 452,718 286,545 534,918 0 0 0 0 0 0 0 0 0 Bin 24 0 0 0 211,778 17,722 0 0 0 0 0 0 0 0 0 0 Bin 25 0 0 0 1,033 519,415 0 0 0 0 0 0 0 0 0 0 Bin 26 0 0 0 831,733 0 0 0 0 0 0 0 0 0 0 0 Bin 27 0 0 0 24,929 0 0 0 0 0 0 0 0 0 0 0 Bin 28 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 29 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 30 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 31 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 32 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 33 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 34 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 35 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 36 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 37 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 38 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 39 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 40 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 41 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 42 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 43 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 44 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 45 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 46 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 47 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 48 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 49 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 50 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 95% Milawa 50 Bins 25 Bins 5 Bins P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12 P13 P14 P15 P16 Bin 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 2 0 0 0 0 0 0 0 0 0 0 0 0 13,415,228 15,000,000 1,584,773 0 Bin 3 0 0 0 0 2,137,450 1,239,257 4,540,463 2,755,285 0 0 0 0 0 0 0 0 Bin 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Bin 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Material from stockpile 14 [GEOVIA: SIMO] [May 2018]
STOCKPILES 120% Stockpile Size and Value Limited stockpile space due to terrain 115% 110% Tested unlimited capacity to no capacity Can fit 30Mt stockpile 105% 100% 95% 90% Milawa (none) Unlimited (~135Mt) 120Mt 60Mt 30Mt 15Mt 0Mt Stockpile Size and Mine Life 22 20 18 Mine Life 16 14 12 10 Milawa (none) Unlimited (~135Mt) 120Mt 60Mt 30Mt 15Mt 0Mt 15 [GEOVIA: SIMO] [May 2018]
RESULTS Increased mining movements Increased early feed grade Shorter mine life (although have expansion potential) Mining Movements and Feed Grade Mining Movements and Feed Grade Milled Tonnes (t) Millions 60 50 40 30 20 10 0 2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 Milled Tonnes (t) Millions 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 60 50 40 30 20 10 0 2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 input t waste t grade input s'pile t input t ex s'pile waste t s'piled t grade input 16 [GEOVIA: SIMO] [May 2018]
RESULTS NPV 14% Brought forward cash flow Increased cash flow in first 5 years by 36% Milawa SIMO Increased NPV by 14% Cum. Disc. Cash Flow Cum. Disc. Cash Flow Cumulative Cash Flow (disc.) Cumulative Cash Flow (disc.) 36% 1 3 5 7 9 11 13 15 17 19 21 1 2 3 4 5 17 [GEOVIA: SIMO] [May 2018]
RESULTS Each element incrementally increased NPV NPV% Milawa 18 [GEOVIA: SIMO] [May 2018]
RESULTS Each element incrementally increased NPV NPV% Schedule Milawa 19 [GEOVIA: SIMO] [May 2018]
RESULTS Each element incrementally increased NPV NPV% Schedule Cut-off Milawa 20 [GEOVIA: SIMO] [May 2018]
RESULTS Each element incrementally increased NPV NPV% Schedule Cut-off Stockpile Milawa 21 [GEOVIA: SIMO] [May 2018]
RESULTS Each element incrementally increased NPV 14% NPV% Schedule Cut-off Stockpile SIMO Milawa 22 [GEOVIA: SIMO] [May 2018]
KEY TAKEAWAYS Mine life (Reserves) vs. NPV Value? Stockpile Milawa SIMO Mine Life 20 years 15 years NPV +14% Impact of grade streaming Blend Bins and Value Stockpile Size and Value 120% 120% 115% 115% 110% 110% 105% 105% 100% 100% 95% 95% Milawa 50 Bins 25 Bins 5 Bins 90% Milawa (none) Unlimited (~135Mt) 120Mt 60Mt 30Mt 15Mt 0Mt 23 [GEOVIA: SIMO] [May 2018]
CONCLUSIONS SIMO was critical tool in realising practical opportunities to increase value Particularly useful when have flexibility (early project) Easy to use one stop shop (any Whittle user can use this) 24 [GEOVIA: SIMO] [May 2018]
THANK YOU QUESTIONS