reconciliation along the base metal value … · a macfarlane _____ page 429 reconciliation along...
TRANSCRIPT
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 429
RECONCILIATION ALONG THE BASE METAL VALUE CHAIN.
A Macfarlane
Tomahee Consulting
Abstract
Metal Accounting and Reconciliation is an increasingly important governance issue in all
mining operations, in that it is required, from a risk management perspective,that the
Company is in control of its product throughout the mining value chain.
Previously, where reconciliation was done, it was often for internal control purposes, and
loosely applied, sometimes with a low degree of confidence and understanding of the
underlying parameters and their natural variability.
In base metal operations, issues such as dilution, stope performance and recovery, are critical
to profitability and long term value, and thus understanding and control of these key value
drivers is essential, not only from the governance perspective, but also from the perspective
of maximising shareholder returns.
In order to implement a system for metal accounting and reconciliation, it is important that
the cause and effect of these value drivers is understood, and that a systematic control system
be established.
While a number of off-the-shelf solutions exist for this work, it is the contention of this paper
that a full understanding of the metal flow, its variability, its underlying loss potential and its
control points is necessary, before a systematic approach to reconciliation can be undertaken.
The paper also advocates that this approach should ensure that the reconciliation system
clearly addresses the reconciliation needs, within a consistent framework. Such a framework
has been developed by AMIRA, in terms of a metal accounting Code. However, up until
now, this Code has been aimed at the Plant processes, whereas this paper shows how this can
be extended to cover the full reconciliation requirements for a base metal mine.
Introduction.
Reconciliation is defined as “the process of finding a way to make two different ideas, facts,
etc., exist or be true at the same time”. In terms of a mining process, this refers to the
comparison of measures and estimates along the value chain, and at different points in time,
in order to track and optimise metal recovery.
This leads to the notion of having a system in place for accounting for the metal. The
University of Cape Town defines metal accounting as “Metal accounting is the estimation of
(saleable) metal in a mine and subsequent process streams over a defined time period.
Comparisons of estimates, from different sources over a specific time period, are called
reconciliation.”
Traditionally, metal accounting has consisted of Geological reconciliations of Mineral
Resource to Mineral Reserve conversion, Mine Planning reconciliation related to the
reconciliation of long term plans to short term plans, grade control reconciliation of head
grades to sampled or block grades, and Mine Survey reconciliation of tonnages and Mine
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 430
Call Factors. In addition, Metallurgical reconciliation has tended to be based on metal
balancing, followed by some commercial metal accounting that links dispatched product to
sales quality, quantities and revenues.
These reconciliations are all done for the particular departmental purpose at hand, and have
been done to varying levels of quality and effectiveness.
Recognising this, AMIRA introduced the concept of an end to end metal accounting system
through a series of global workshops in 2001, which culminated in the formation of the Metal
Accounting Project P754 in 2003. As a result of global research work, the Code for Metal
Accounting was published in its current version in 2007.
During the process of development of the Code, Wits University was involved in an attempt
to include the geological and mining components into the study, in order produce an end-to-
end accounting system. Unfortunately, at the time, limited support for this was gleaned from
mining companies, with the result that the research and the code itself has tended to
concentrate on the mineral processing part of the value chain only, with the result that the
traditional stumbling block of the reconciliation between the plant metal balancing system
and the mine accounting system at the point of delivery from the mine to the plant, remains in
place.
This paper attempts to show that the AMIRA Code principles and process can indeed be
extended to the full value chain, as an end-to-end reconciliation system.
Reconciliation as a Governance issue.
Corporate Governance is no longer an issue associated with Boardroom responsibility and
fiduciary duty.
Instead, it requires that Corporate level Governance is cascaded into the tactical and
operational levels of the company, at the value chain and professional support level
respectively. This is supported and endorsed by the following:
• Sarbannes-Oxley requirements for risk management and reporting;
• King III requirements for Integrated Reporting that requires integrated risk reporting;
• Impending development of ISO 31000 standard on risk management;
• Increasing shareholder demands for control and optimisation of product and earnings;
• Moves towards more disclosure in terms of reporting of Mineral Resources and
Mineral Reserves, and their Valuation;
• Reconciliation and metal accounting as essential components of effective Mineral
Asset Management;
• Requirements for optimisation of products where logistical or competitive advantage
constraints exist.
T
6
A
_
T
A
p
T
c
W
c
in
The
6th S
A M
____
The
A d
prod
The
can
Wit
com
ncl
So
Sou
Macf
___
e re
dia
duc
e re
be
•
•
•
•
•
•
•
•
•
•
•
thin
mpe
lud
uth
the
farl
___
eas
agra
cin
easo
e su
T
T
al
T
T
pr
T
T
ar
T
T
T
T
an
T
n th
ellin
e th
hern
ern
lan
____
son
amm
g c
ons
umm
To e
To e
lon
To “
To
rod
To i
To e
re i
To e
To e
To e
To i
nd
To e
he
ng
he
n Af
Afr
e
___
n fo
ma
cop
s fo
ma
ens
ena
ng t
“pro
ens
duc
den
ens
ide
ens
ens
ens
incl
En
ens
Ba
re
fol
fric
rica
___
or m
atic
pper
or a
arise
ure
abl
the
ote
sur
ct;
ntif
sure
nti
ure
ure
ure
lud
nter
ure
ase
easo
llow
can
an B
____
me
re
r an
ado
ed
e th
e r
va
ect”
re t
fy a
e th
fie
e th
e th
e re
de m
rpri
e in
M
ons
win
n Ins
Bas
___
tal
epr
nd
opt
as
hat
rec
alue
” gr
the
acc
hat
d th
hat
hat
elia
me
ise
nteg
Meta
s f
ng.
stit
se M
___
l ac
rese
cob
ting
fol
the
onc
e ch
rad
e M
cep
pr
hro
the
com
able
tal
Ri
gra
al e
for
tute
Met
____
cco
ent
bal
g an
llow
e va
cili
hai
de a
Min
ptab
ract
oug
ese
mp
e re
ac
isk
atio
env
re
e of
tals
____
oun
tatio
lt is
n e
ws
alu
iati
n;
and
nera
ble
tica
gh m
fa
pete
epo
ccou
ma
on o
viro
con
f Mi
s Co
___
ntin
on
s sh
end
:
ue c
ion
d pr
al
tol
al t
me
cto
enc
orti
unt
ana
of r
onm
nci
Minin
onf
___
ng a
of
how
d to
cha
n o
rod
Re
lera
targ
asu
ors
ce a
ng
ting
age
reco
men
liat
ng a
fere
____
alo
f t
wn
o en
ain
f p
duct
esou
anc
gets
urem
are
and
of
g a
eme
onc
nt,
tion
and
ence
___
ong
he
be
nd
pro
pro
t fr
urc
ces
s fo
me
e m
d co
f the
and
ent
cili
sp
n s
d M
e 20
___
P
g th
V
elow
ap
ovi
duc
rom
ce
an
or “
ent
mon
ont
ese
d re
sy
iati
peci
sys
Meta
011
____
Pag
heB
Valu
w.
pro
des
ct
m lo
inv
nd r
“m
an
nito
trol
e va
econ
ste
on
ific
stem
allu
1
___
ge 4
Bas
ue
oac
s th
ma
oss
ven
rang
mod
d a
ored
l is
aria
nci
em;
an
c an
ms
urgy
___
431
se M
Ch
ch t
he b
ass
alo
ntor
ges
dify
ana
d an
ex
abl
ilia
nd m
nd
to
y
____
Me
hain
to m
bas
be
ong
ry
s of
ying
alys
nd
xhib
es
atio
met
un
o b
___
tal
n
me
sis
etw
g th
is
f va
g fa
sis;
co
bite
in p
n a
tal
niqu
be d
___
l Va
for
etal
for
wee
he v
ef
aria
acto
ntr
ed o
pub
as e
acc
ue
dev
____
alu
r a
l ac
r m
en
val
ffec
abi
ors
roll
on
blic
ess
cou
rea
vel
___
ue C
a ty
cco
meta
suc
lue
ctiv
ility
s” s
led
the
c re
ent
unt
aso
ope
___
Ch
ypi
oun
al a
cce
ch
vely
y a
suc
wi
ese
epo
tial
ting
ons
ed
____
hain
cal
tin
acco
essi
hain
y c
lon
ch a
ithi
cr
orts
l co
g al
ex
an
___
n.
l b
g a
oun
ive
n;
con
ng t
as d
in a
itic
s;
omp
lon
xist
nd
___
base
alon
ntin
an
nve
the
dilu
acc
cal
pon
ng t
t th
im
____
e m
ng
ng;
nd
erte
e va
utio
cept
var
nen
the
hat
mple
___
me
the
re
ed
alue
on
tab
riab
nts
va
pr
em
___
tal
e v
lev
int
e ch
an
ble
ble
of
alue
rovi
ment
____
op
valu
van
to
hai
d r
ran
es;
f th
e ch
ide
ted
____
per
ue
t p
sal
in;
reco
nge
he M
hai
e fu
d. T
___
rati
cha
poin
leab
ove
es;
MR
n.
urth
The
___
ion
ain
nts
ble
ery
RM
her
ese
_
n
n
y
M
r
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 432
1. Base metal deposits are unique in their nature, in terms of structure, mineralogy, grade
and grade distribution, and their geotechnical and geometallurgical characteristics;
2. These deposits vary internally in terms of these characteristics, often resulting in
mineralogical changes as mining progresses through the orebody, from oxides through
to sulphides, and through other mineralogical geozones;
3. Base metal mine designs and mine processes are unique to the orebody
characteristics;
4. Downstream processes are often seen as the value creating parts of the chain. If this is
the case, then at a minimum the plant needs a consistent feed in terms of volume,
hardness, quality, size and grade, in order to perform to design. Alternatively it should
be recognised that value can be added upstream where the total chain can be
optimised, through a complete accounting and optimisation process;
5. The array of different mining methods result in different challenges in terms of grade
control and tonnage reconciliation.In most massive mining operations (as applied to
base metal deposits), grade control programmes must be specified in terms of
protocols, that define sampling points and methods, appropriate for the method, from
the creation of the grade/block model, to the final product dispatch. Grade variability
in such operations is often high, and this variability must be understood from various
phases of delineation drilling. Sampling methods and locations must then be
determined, whether this be on the basis of sampling theory and semi-variogram
analysis to define sampling methods and densities, or practical considerations of the
practicality of drawpoint sampling, and sample turnaround time. In all these instances,
reconciliation of grade and tonnage to the block model and sampling data is critical
for operational control.
6. Dilution control is particularly critical, as shown in the figure below, which indicates
the impact of dilution on the net Present value (NPV) of a sublevel open stoping gold
operation.
In such operations, although planned dilution (through design), may be 10%, dilution
in individual stopes of up to 70% is possible and not too uncommon. Reconciliation is
essential in order to identify and control such dilution impacts.
-200000
0
200000
400000
600000
800000
1000000
1200000
1400000
0% 5% 10% 15% 20% 25% 30%
% dilution
NPV
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 433
7. Variance in grade and tonnage from the grade/block model or the ongoing face
sampling results must be investigated, in order to assess whether some geological or
mineralogical change has occurred, or some change in draw control or mining
sequence has resulted in a negative impact. This can only be done on the basis of
sufficient information being available, through a reconciliation system.
Adopting a systematic approach to reconciliation.
In order to develop and implement a full end to end reconciliation system, a systematic
approach is necessary. This is because of the multivariate nature of the problem, the
complexities of the system, and the multi-disciplinary approach necessary for full and
integrated reconciliation.
The AMIRA framework provides such a system, and can be adapted reasonably easily as the
basis for the system.
The main topic areas and sequence of such an exercise would be as follows, relying on the
AMIRA Code principles:
1. Define the purpose and objectives of the reconciliation excercise.
This requires the determination of the strategic, governance and operational purpose,
and the scope of the requisite programme. In other words, what is the reason for
implementing the system, and what are the reporting requirements of the system? This
is a strategic planning exercise, that can be conducted using a multi-disciplinary
strategic workshopping approach to define the reconciliation charter.
Within this phase, it will be necessary to define the reconciliation boundaries that are
appropriate for the operation at hand. Such reconciliation boundaries may be:
• Block model to sampling reconciliation
• Sampling to broken reconciliation
• Block model to broken grade reconciliation
• Plan to actual broken grade and tonnage reconciliation
• Plan to actual mining volume broken
• Ore broken tons and grade reconciled to ore tons and grade hoisted or
trammed
• Hoisted ore tons and grade reconciled to plant feed head grade and tonnage
• Stockpiling tonnage movement reconciliation
• Plant balance reconciliation
• Plant to product reconciliation
• Dispatch to customer reconciliation (includes all logistical inventories,
stockpiles etc)
• Model to Mine reconciliations
• Mine to Plant reconciliations
• Plant to Product reconciliations
• Resource to Reserve reconciliation
• Period on period reconciliations.
T
6
A
_
The
6th S
A M
____
So
Sou
Macf
___
2.
uth
the
farl
___
O
po
B
ar
an
di
co
D
T
is
di
H
of
al
be
Fu
tr
is
O
de
m
hern
ern
lan
____
Onc
oss
Broa
re r
nd
isp
ont
Defi
This
s fr
iag
How
f il
ll o
e ta
urt
rans
s”
Onc
eve
mea
n Af
Afr
e
___
ce t
sibl
adl
req
rec
patc
trac
ine
s re
om
gram
wev
llic
opp
ake
ther
siti
as
ce a
elop
asur
fric
rica
___
this
le r
ly,
quir
con
ch a
cts,
e al
equ
m th
mm
ver,
it s
port
en i
rm
ion
we
a p
ped
ring
can
an B
____
s is
reco
the
red
ncil
and
, an
ll o
uire
he g
mati
, th
stoc
tun
into
ore
n, b
ell a
proc
d,th
g p
n Ins
Bas
___
s d
onc
e pu
d fo
liat
d th
nd i
re
es t
geo
ic f
he m
ckp
nitie
o a
e, p
ein
as f
ces
he
poin
stit
se M
___
efin
cili
urp
or m
tion
he c
in c
an
that
olog
flow
min
pili
es
cco
pro
ng t
futu
ss m
nex
nts,
tute
Met
____
ned
iati
pos
man
ns t
cus
cas
nd p
t a
gic
w s
nin
ing
for
oun
ojec
tem
ure
ma
xt p
, an
e of
tals
____
d, a
on
es
nag
tha
stom
se o
pro
ful
cal
she
ng f
po
r cr
nt.
cts
mpo
e or
ap t
par
nd
f Mi
s Co
___
a p
arc
of
gem
at a
me
of d
odu
ll a
mo
eet,
flow
ossi
ross
tha
ora
refl
tha
rt o
all
Minin
onf
___
pict
cs a
the
men
are
r. T
disp
uct
and
ode
, w
wsh
ibil
s tr
at
ary
low
at s
of t
tra
ng a
fere
____
ture
alo
ese
nt c
req
The
put
t flo
d de
el to
with
hee
liti
ram
are
arr
w m
sho
the
ansp
and
ence
___
e s
ong
e re
con
qui
ese
te a
ow
etai
o th
h de
et i
es,
mm
e u
ran
map
ws
pr
por
d M
e 20
___
P
uch
g th
econ
ntro
ired
e ar
and
s, n
iled
he
etai
is u
or
ming
und
ngem
ps n
s al
roce
rt a
Meta
011
____
Pag
h a
e v
nci
ol, w
d fo
re r
d lit
now
d p
fin
iled
usu
re l
g, c
der
me
nee
ll f
ess
arcs
allu
1
___
ge 4
as t
valu
ilia
wh
for
requ
tiga
w a
proc
nal p
d fl
ually
loss
cro
de
ents
ed t
flow
s is
s.
urgy
___
434
the
ue c
atio
hich
com
uire
atio
and
ces
pro
low
y l
s ro
ss
evel
s to
to b
ws,
s to
y
____
on
cha
ons
h ar
mm
ed
on.
d in
ss m
odu
w sh
oos
out
ho
lop
o be
be d
, fo
o de
___
ne
ain
are
re f
mer
in
n th
map
uct.
hee
sely
tes,
isti
pme
e m
dev
or
efin
___
bel
.
e su
fro
rcia
ter
he
p fr
. U
ets
y d
, an
ing
ent
mod
velo
eac
ne
____
low
ubd
om
al r
rms
fut
from
sua
in
defi
nd
g an
t of
difi
ope
ch
on
___
w c
div
the
reco
s of
tur
m e
ally
the
fine
loc
nd
ften
fied
ed.
ph
th
___
can
vide
e m
onc
f co
re.
end
y, th
e m
ed,
ck-u
sur
n s
d or
hase
his m
____
n be
ed
mod
cili
om
d to
hes
min
and
up
rfac
sho
r ch
e o
ma
___
e c
int
del
iati
mme
o en
se e
nera
d d
ton
ce
ow
han
of t
ap a
___
crea
to r
to
on
erci
nd
exi
al p
doe
nna
ore
or
nge
the
all
____
ated
reco
the
be
ial
be
ist i
pro
es n
age
e m
efl
ed l
pr
cu
___
d, t
onc
e p
etw
ag
de
in s
ces
not
es.
mov
ow
late
roje
urre
___
tha
cili
lan
ween
ree
eve
som
ssin
tak
Ad
vem
ws t
er.
ect
ent
____
at in
iati
nt d
n th
eme
lop
me
ng
ke
ddit
men
tha
Th
, h
an
____
ndi
on
deli
he
ent
ped
for
cir
acc
tion
nts
at a
hus
has
d f
___
icat
s th
ive
pla
ts a
d, th
rm
rcui
cou
nal
mu
are
, “a
be
futu
___
tes
hat
ry,
ant
and
hat
of
its.
unt
lly,
ust
in
as-
een
ure
_
t
t
d
t
f
t
t
n
n
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 435
3. Conduct a full risk assessment.
A Risk assessment should be conducted on the current system and the process flow
map, highlighting all the following risks. Once the mapping exercise has been
completed, this can be done on the basis of either a fault tree analysis, or a Cause and
Effect analysis. In the case of the fault tree analysis, the oreflow needs to be tested in
terms of defining the risks of poor or inaccurate measurement at measuring points, or
the risk of ore or metal loss along transport routes.
Thus, in each of these areas, the risks must be identified and quantified in terms of the
following
• Weighing, sampling and analytical risks;
• Weighing equipment and methodology risks;
• Possibility for incorrect recording of data;
• Possibility/risks of inaccurate sampling;
• Risks on sample security;
• Risks on estimates of stockpiles;
• Risk of arbitrary methods to assess/calculate metal recoveries;
• Risks of inclusion of illegitimate/biased data;
• Risks of incorrect calculations;
• Risks of real loss of product in transport;
• Risks as a result of incompetency of operators;
4. Integrity of Data
Once the oreflow and its risks have been identified, it is then necessary to define all
data requirements and data capture systems and technologies, throughout the end to
end process. Data variability and tolerance levels must also be defined. In the case of
sampling information and data, variability is defined from the sampling data itself. On
the assumption that the sampling density and methods are appropriate for the
variability of the deposit (by no means a sure assumption!),then the samples
themselves can be used to define the natural variability of predicted grade, and the
definition of short range grade models for short term planning processes.
Analysis of data can only be done on real time data. Monthly averaging is of no use :
data on critical variables must be based on real time data analysis and trends and
variability, to assess the natural “noise” of critical variables.
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 436
Analysis of data, whether on the operation concerned or a similar operation should
allow an assessment to be made of the variability of the data. In the case of the
illustration above, this would allow assessment of the variability in terms of a
statistical function, such as standard deviation or coefficient of variability, and the
definition of 90% probability limits of the expected range of outcomes.
An example of such an analysis, based on the above data, is illustrated below, which
shows the 90% confidence limits on the variability of the data under consideration, in
this case Mine Call Factor.
The example chosen illustrates an extreme case, which is actually a diamond
operation.
Actual MCF 2002-2005
0
50
100
150
200
250
300
J A J O J A J O J A J O J A J O
%No 1 plant
No 2 plant actual
ExtValue(86.781, 23.499)
Va
lue
s x
10
^-2
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
40
60
80
100
120
140
160
180
200
< >5.0%90.0%
61.0 156.6
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 437
5. Assess Mass measurement
The next step is to define mass measurement requirements and mass balancing in
terms of:
• Accuracy, precision and methods;
• Mine tonnage assessments from all sources;
• Mass flow measurement systems and calibration;
• Assessment of all inventories and mass in process;
• Assessment of Relative Density and moisture contents;
• Assessments of fill factors and loading;
• Definition of mass measuring points, technologies and accuracies;
• Mass balancing between points and over the whole process.
This part of the process defines the measuring points and technologies that should be
implemented, based on critical control points and variability.
This must include stockpiling operations, whether these are planned or illicit
stockpiling that may be done to protect departmental interests, such as bonus
payment. All these possible sources of tonnage discrepancy should have been
identified in the process map.
Often, mass measurement technologies are not perceived to be robust enough to deal
with mining conditions, but this is usually a preconceived notion that is aimed at
avoiding the tight control that metal accounting and reconciliation systems require.
For example, underground mechanised mining operations can easily provide greater
precision on mass balancing, through the use of cavity monitoring systems, bucket
and bowl weight indicators, vehicle tracking and fleet management systems, all linked
through to a full tonnage control system that measures and reports in real time.
Such a system was successfully introduced at Finsch Mine, where full real time fleet
management and dispatch systems were introduced, to the extent of developing an
architecture to link mine planning, draw control, dispatch and fleet management
systems into an integrated management information system, driven through a central
database.
6. Sampling
In terms of sampling,the following must be defined with respect to grade sampling:
• Appropriate sampling points, at the face and at points along the process flow;
• Sampling methods appropriate for the orebody at hand;
• Sampling Quality Assurance and Quality Control;
• Appropriate and reliable sampling technologies;
• Sampling accuracy;
• Sampling precision;
• Sample storage, transport, supervision and security;
• Assay quality assurance.
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 438
7. Sample preparation and analysis
This includes the definition of sample splitting and assaying protocols and quality
assurance, through the use of validation, checks, duplicate samples, standard samples,
blank samples etc.
All of these considerations should be included in a grade conytol policy and protocol
document, that provides a governance policy on grade control to be defined.
Included in the grade control protocol should be the following:
• Data collection
– Analysis methods
– Modelling procedures
– Planning for data collection
• Definition
– Cutoff grade application
– Level of selectivity
– Link and reconciliation to planning
• Monitoring and control
– Develop grade control plan
– Staking and delineation
– Monitoring of loading
– Load dispatch control
– Blending strategy
• Stockpiling strategy
– ROM sampling procedures
– Stockpiling allocation/definition
– Monitoring/control of stockpiles
– Truck/vehicle count
– Measurements
• Reconciliations
– Truck factors
– Reconciliation of model to actual to stockpile
8. Stock takes and inventories.
It is necessary to define methods and frequencies of all stock takes, stockpile
measurements, inventory measurements, work in progress tons and grade. This must
be active, in that the regularity of measurement needs to be assessed. Month end
reconciliation is not enough : real time measurement of all stockpile measurements
and reconciliations must be undertaken. This can be achieved through weighline
control.
9. Metal balancing
Metal balancing boundaries and control points must be identified, in terms of Mine
outputs, representation/process and measurement bases, to include all factors,
boundaries, recoveries, reconciliation requirements and calculations and controls.
This is throughout the whole length of the value chain.
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 439
10. Reporting.
Data collection systems and information reporting and dissemination in terms of
management controls, KPIs and reporting must be established, as well as variability
analysis, so that proactive control at the right level can be established, for proactive
control.
Reporting must be based on the critical success factors that drive the process, and on
the trends and ranges of the measured variables. This takes account of the natural
variability that exists, and allows reporting on an exception basis when out of range
trends start to emerge. This however is still based on continuous real time
measurement.
Furthermore, reporting must be defined at the right level, where reporting information
is matched to organisational responsibilities and Key Performance Indicators.
As far as possible, measurement should focus on leading indicators, that show that a
trend is emerging, so that proactive intervention and correction can be effected.
11. Responsibilities.
Responsibility and accountability boundaries must be established so that performance
management systems can be developed and implemented. AMIRA requires the
appointment of a Competent Person for metal accounting, and this principle should be
adopted whereby an overall Competent Person takes end-to-end responsibility for
metal accounting and reconciliation, while individual persons in particular areas of
expertise, form the Competent team.
The overall Competent Person should maintain an air of independence, and therefore
it is logical the Mine Surveyor fulfils this role, within the MRM organisation.
Clearly this does not mean that this person takes control of the numbers in, say, the
plant. However the person should have access to the plant, in order to collect and
integrate the metallurgical numbers that have been derived by the metallurgist.
12. Accounting and auditing.
The system developed and implemented must be auditable and transparent. Thus, data
integrity is essential, and audit trails must be available to indicate and track metal
flow along the value chain.
External audit and validation is desireable.
Data, controls and systems must be linked to Enterprise Accounting and Auditing
systems to ensure Best Practice compliance on an ongoing basis. This will then form
part of the Company Risk management process, and Governance procedures.
This is important where poor recoveries, dilution or loss is occurring, in that
investigative processes to rectify these discrepancies must be based on sound data and
information. This may be done using a Cause and Effect approach as outlined below,
as applied to a dilution problem.
Once data is available, quantitative investigations can be conducted on real data, and
sustainable improvement initiatives can be put in place.
T
6
A
_
The
6th S
A M
____
So
Sou
Macf
___
13
uth
the
farl
___
Fu
lo
. O
O
tr
B
M
T
en
H
co
hern
ern
lan
____
urt
oss,
Opt
Only
rue
Base
Mill
This
ner
How
ont
n Af
Afr
e
___
ther
, us
tim
y o
M
e m
l O
s m
rgy
wev
trol
fric
rica
___
P
r an
sin
misa
onc
ine
met
Opti
may
y c
ver,
l sy
can
an B
____
P
cond
Poo
Poor
nal
g th
atio
e a
eral
tal
imi
y, fo
con
, th
yste
n Ins
Bas
___
Poor
ditio
or sa
r desi
lysi
he
on.
all o
l R
mi
isat
for
sum
his
em
stit
se M
___
ns
afety
igns
in
is c
kin
of t
Reso
inin
tion
exa
mp
ba
is
tute
Met
____
Po
nform
can
nd o
the
our
ng
n, w
am
tio
ala
in
e of
tals
____
In
oor
matio
n th
of
e ab
rce
op
whe
mple
n
ance
pla
f Mi
s Co
___
Inc
w
ncrea
cos
m
on
hen
fau
bov
Th
era
ere
e, b
in
e c
ace
Minin
onf
___
rease
width
sed
t
Wro
meth
be
ult t
ve i
hrou
atio
eby
be
th
can
.
ng a
fere
____
ed
h
L
pr
L
sha
v
ong
hods
e co
tree
is i
ugh
ons
y sta
in
he
n o
and
ence
___
Dil
Lowe
rodu
oss o
reho
value
man
ond
e a
n p
hpu
in
abl
rel
mi
nly
d M
e 20
___
P
lutio
c
er
ct
Low
of
lder
e
Poo
nage
duc
anal
plac
ut O
n pa
le a
lati
ills
y b
Meta
011
____
Pag
n
Inc
Loss
capa
wer
P
or
men
cted
lys
ce,
Opt
arti
and
on
, a
be
allu
1
___
ge 4
creas
tons
s of
city
NPV
Poor
nt
d to
is r
an
tim
icul
d co
to
and
ach
urgy
___
440
sed
s
Dela
to
blast
o as
refe
nd t
misa
lar
ons
or
d a
hie
y
____
ayed
o plan
ting
Po
sse
erre
the
atio
us
sist
re f
acid
eved
___
r
ore
nt
oor tr
ss
ed
sy
on o
sua
tent
fee
d c
d o
___
Poo
recov
Lo
cas
rainin
the
to
yste
opp
lly
t pl
d s
con
onc
____
Lowe
grad
or
very
ower
shflow
Poo
ng
e re
ear
em
por
ex
lan
size
nsu
ce
___
er
de
r
w
or pr
cont
eal
rlie
is
rtun
xhib
nt p
e an
ump
the
___
roces
trol
an
er in
sta
niti
bit
perf
nd
ptio
e f
____
ss
d a
n th
able
ies
op
form
m
on
full
___
app
he
e an
be
ppo
ma
ine
in
l, q
___
pare
pap
nd
re
ortu
anc
eral
n th
qua
____
ent
per
un
alis
unit
e c
log
he
anti
___
ca
r.
nder
sed
ties
can
gy,
le
itat
___
ause
r c
d.
s fo
be
an
each
tive
____
es o
ont
or M
e ac
d r
h
e o
____
of m
trol
Mi
chi
resu
cir
ore
___
me
l, c
ine
eve
ulta
rcui
flo
___
etal
can
to
ed.
ant
its.
ow
_
l
n
t
w
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 441
Conclusions.
Full and complete metal accounting is essential for control and governance, along the value
chain. In order to establish such a system, a systematic approach that is common along the
full value chain should be adopted. The AMIRA Code gives good guidance on how this
should be achieved, in that it allows a process that includes the identification of practices,
processes, people and technologies that will allow such a system to be established.
Clear accountability must be established for the management of metal accounting and
reconciliation, as an essential component of the Mineral Resource management function on
the mine.
Only once a full, integrated system is in place, that captures and analyses information on a
real time basis, can investigative work and optimisation studies be put in place. Thus metal
accounting and reconciliation provide an essential foundation for real value creation.
The Southern African Institute of Mining and Metallurgy
6th Southern African Base Metals Conference 2011
A Macfarlane
__________________________________________________________________________________
Page 442