A top mining operation goes beyond benchmarks to reduce its cost per ton by over 10%

A large open-pit mining operation needed to reduce costs, but a competitive benchmarking study had shown they were already the best among their peers in overall performance. Rather than being satisfied with this, the mine team knew their current performance was still not enough to meet their organization's expectations. They called in Stroud to help them go beyond the benchmark.

To begin, the team took another look at the various levers driving mine performance, including areas where they were already the best in class. One such area was the load factor of their haul truck fleet: how much, on average, was loaded into the trucks as a percent of the trucks’ rated capacity. They were already the top performer in this category, just a few percentage points shy of 100%, so the team decided to challenge the rated capacity itself. They asked: what would it take to safely and reliably exceed 100%, and how far could we go? This was something none of their competitors had attempted before.

In posing this question they found many popular reasons as to why it would not be possible. For example, they heard:

  • We may void the warranty on the truck chassis which is a risk we cannot take.”

  • “Ore will begin spilling out of the trucks, causing a safety hazard and adding clean-up costs.”

  • “The weight sensors on the trucks are inaccurate so we can’t guarantee the trucks won’t become too overloaded.”

  • “The shovels that load the trucks are the most capital intensive asset and must be prioritized; they don’t have time to add the extra tons with partial scoops.”

  • “Further loading the trucks could lead to an increase in rapid tire deflations, posing a safety risk and adding cost.”

With Stroud’s help, the team began safely and systematically testing each of these perceived limitations. First, they conferred with the truck’s original equipment manufacturer (OEM) to learn under what conditions (if any) the rated capacity could be safely exceeded. The OEM clarified the precise limitations to which the trucks were warrantied and this revealed a substantial margin for improvement beyond 100%. Next, the team filled a truck to the warrantied maximum and drove it throughout the mine at the posted speed limit, finding that no ore spilled. In a similar fashion, the team went on to problem solve or debunk all the other perceived limitations over the next several weeks, generating a 5% improvement in load factor across the fleet. Two years later, the mine had extended this advantage to an 8% improvement.

Heavy Haulers Graph.png

This improvement enabled the mine to save millions by being able to eliminate some contractor hauling that was no longer required. It also jumpstarted a comprehensive improvement program across the site. Two years later, the mine had reduced its costs by well over 10%, in spite of already being the best mine in its class.


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The Lure and Limitations of Benchmarking

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