Publications : Papers

Optimising a Mineral Supply Chain under Uncertainty with Long-term Sales Contracts
Published in: 2014
Author: J Zhang and R Dimitrakopoulos
Volume Title: Orebody Modelling and Strategic Mine Planning SMP 2014

A two-stage stochastic mixed integer non-linear program is formulated for a mining complex to optimise strategic and tactical plans. The objective is to find the near optimal decisions for a mineral supply chain in the context with uncertainties in both ore supply and the commodity market (price and demand). The endogenous spot price in the commodity market and long-term sales contracts are considered in the formulation of the mining complex’s optimisation model and an ad hoc heuristic is developed to deal with the throughput – and head-grade-dependent recovery rate in processing plants. Numerical results indicate that the proposed heuristic is effective and efficient in numerical tests. Based on the proposed model and heuristic, a long-term contract design strategy is proposed for making decisions on the contract price and strategic investments. A shadow price based method is also proposed to evaluate the existing mining schedule.


Zhang, J and Dimitrakopoulos, R, 2014. Optimising a mineral supply chain under uncertainty with long-term sales contracts, in Proceedings Orebody Modelling and Strategic Mine Planning Symposium 2014 , pp 25–32 (The Australasian Institute of Mining and Metallurgy: Melbourne).

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