IDEAS home Printed from https://ideas.repec.org/a/eee/jrpoli/v75y2022ics0301420721004670.html
   My bibliography  Save this article

An integrated approach to open-pit mines production scheduling

Author

Listed:
  • Alipour, Aref
  • Khodaiari, Ali Asghar
  • Jafari, Ahmad
  • Tavakkoli-Moghaddam, Reza

Abstract

In an Open-Pit Production Scheduling (OPPS) problem, the aim is to determine the mining sequence of an orebody as a block model. In common research methods for scheduling, commodity price and consequently block economic value are considered as fixed values. Due to commodity price time series fluctuations throughout the time, it is necessary to consider the variation of commodity price in each period of the OPPS problem. This paper introduces a new approach for the integration of forecasted copper prices based on stochastic differential equations (SDE) with the conventional integer programming OPPS problem. If the block values are different in each period, the block value is referred to as dynamic, else it is considered static. Since OPPS is known to be an NP-Hard problem and block values vary according to the scheduling period, an efficient Genetic Algorithm (GA) is presented to find feasible solutions. Our proposed algorithm is implemented on Marvin copper orebody. Comparison of the design by the conventional static and the SDE simulation-based dynamic block value methods illustrates that compared to the static design; the total value of the dynamic design is 43% higher than that of static design.

Suggested Citation

  • Alipour, Aref & Khodaiari, Ali Asghar & Jafari, Ahmad & Tavakkoli-Moghaddam, Reza, 2022. "An integrated approach to open-pit mines production scheduling," Resources Policy, Elsevier, vol. 75(C).
    • Handle: RePEc:eee:jrpoli:v:75:y:2022:i:c:s0301420721004670
    DOI: 10.1016/j.resourpol.2021.102459
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301420721004670
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.resourpol.2021.102459?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Samavati, Mehran & Essam, Daryl & Nehring, Micah & Sarker, Ruhul, 2017. "A local branching heuristic for the open pit mine production scheduling problem," European Journal of Operational Research, Elsevier, vol. 257(1), pages 261-271.
    2. Samavati, Mehran & Essam, Daryl & Nehring, Micah & Sarker, Ruhul, 2018. "A new methodology for the open-pit mine production scheduling problem," Omega, Elsevier, vol. 81(C), pages 169-182.
    3. Samavati, Mehran & Essam, Daryl & Nehring, Micah & Sarker, Ruhul, 2017. "A methodology for the large-scale multi-period precedence-constrained knapsack problem: an application in the mining industry," International Journal of Production Economics, Elsevier, vol. 193(C), pages 12-20.
    4. Dimitrakopoulos, Roussos G. & Abdel Sabour, Sabry A., 2007. "Evaluating mine plans under uncertainty: Can the real options make a difference?," Resources Policy, Elsevier, vol. 32(3), pages 116-125, September.
    5. Paithankar, Amol & Chatterjee, Snehamoy & Goodfellow, Ryan & Asad, Mohammad Waqar Ali, 2020. "Simultaneous stochastic optimization of production sequence and dynamic cut-off grades in an open pit mining operation," Resources Policy, Elsevier, vol. 66(C).
    6. Daniel Espinoza & Marcos Goycoolea & Eduardo Moreno & Alexandra Newman, 2013. "MineLib: a library of open pit mining problems," Annals of Operations Research, Springer, vol. 206(1), pages 93-114, July.
    7. Shishvan, Masoud Soleymani & Sattarvand, Javad, 2015. "Long term production planning of open pit mines by ant colony optimization," European Journal of Operational Research, Elsevier, vol. 240(3), pages 825-836.
    8. Merton, Robert C, 1973. "An Intertemporal Capital Asset Pricing Model," Econometrica, Econometric Society, vol. 41(5), pages 867-887, September.
    9. Jélvez, Enrique & Morales, Nelson & Nancel-Penard, Pierre & Cornillier, Fabien, 2020. "A new hybrid heuristic algorithm for the Precedence Constrained Production Scheduling Problem: A mining application," Omega, Elsevier, vol. 94(C).
    10. Merton, Robert C., 1976. "Option pricing when underlying stock returns are discontinuous," Journal of Financial Economics, Elsevier, vol. 3(1-2), pages 125-144.
    11. Black, Fischer & Scholes, Myron S, 1973. "The Pricing of Options and Corporate Liabilities," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 637-654, May-June.
    12. M Kumral & P A Dowd, 2005. "A simulated annealing approach to mine production scheduling," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 56(8), pages 922-930, August.
    13. Gilani, Seyyed-Omid & Sattarvand, Javad & Hajihassani, Mohsen & Abdullah, Shahrum Shah, 2020. "A stochastic particle swarm based model for long term production planning of open pit mines considering the geological uncertainty," Resources Policy, Elsevier, vol. 68(C).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Hazrathosseini, Arman & Moradi Afrapoli, Ali, 2023. "The advent of digital twins in surface mining: Its time has finally arrived," Resources Policy, Elsevier, vol. 80(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nancel-Penard, Pierre & Morales, Nelson & Cornillier, Fabien, 2022. "A recursive time aggregation-disaggregation heuristic for the multidimensional and multiperiod precedence-constrained knapsack problem: An application to the open-pit mine block sequencing problem," European Journal of Operational Research, Elsevier, vol. 303(3), pages 1088-1099.
    2. Jélvez, Enrique & Morales, Nelson & Nancel-Penard, Pierre & Cornillier, Fabien, 2020. "A new hybrid heuristic algorithm for the Precedence Constrained Production Scheduling Problem: A mining application," Omega, Elsevier, vol. 94(C).
    3. Zeng, Lanyan & Liu, Shi Qiang & Kozan, Erhan & Corry, Paul & Masoud, Mahmoud, 2021. "A comprehensive interdisciplinary review of mine supply chain management," Resources Policy, Elsevier, vol. 74(C).
    4. Pringles, Rolando & Olsina, Fernando & Penizzotto, Franco, 2020. "Valuation of defer and relocation options in photovoltaic generation investments by a stochastic simulation-based method," Renewable Energy, Elsevier, vol. 151(C), pages 846-864.
    5. Christensen, Bent Jesper & Parra-Alvarez, Juan Carlos & Serrano, Rafael, 2021. "Optimal control of investment, premium and deductible for a non-life insurance company," Insurance: Mathematics and Economics, Elsevier, vol. 101(PB), pages 384-405.
    6. Suresh M. Sundaresan, 2000. "Continuous‐Time Methods in Finance: A Review and an Assessment," Journal of Finance, American Finance Association, vol. 55(4), pages 1569-1622, August.
    7. Blanchet-Scalliet, Christophette & El Karoui, Nicole & Martellini, Lionel, 2005. "Dynamic asset pricing theory with uncertain time-horizon," Journal of Economic Dynamics and Control, Elsevier, vol. 29(10), pages 1737-1764, October.
    8. Bilel Jarraya & Abdelfettah Bouri, 2013. "A Theoretical Assessment on Optimal Asset Allocations in Insurance Industry," International Journal of Finance & Banking Studies, Center for the Strategic Studies in Business and Finance, vol. 2(4), pages 30-44, October.
    9. Izhakian, Yehuda, 2020. "A theoretical foundation of ambiguity measurement," Journal of Economic Theory, Elsevier, vol. 187(C).
    10. Patrick Asea & Mthuli Nube, 1997. "Heterogeneous Information Arrival and Option Pricing," UCLA Economics Working Papers 763, UCLA Department of Economics.
    11. repec:dau:papers:123456789/5374 is not listed on IDEAS
    12. Asea, Patrick K. & Ncube, Mthuli, 1998. "Heterogeneous information arrival and option pricing," Journal of Econometrics, Elsevier, vol. 83(1-2), pages 291-323.
    13. Ma, Chenghu, 2006. "Intertemporal recursive utility and an equilibrium asset pricing model in the presence of Levy jumps," Journal of Mathematical Economics, Elsevier, vol. 42(2), pages 131-160, April.
    14. Samavati, Mehran & Essam, Daryl & Nehring, Micah & Sarker, Ruhul, 2017. "A methodology for the large-scale multi-period precedence-constrained knapsack problem: an application in the mining industry," International Journal of Production Economics, Elsevier, vol. 193(C), pages 12-20.
    15. Martzoukos, Spiros H. & Zacharias, Eleftherios, 2013. "Real option games with R&D and learning spillovers," Omega, Elsevier, vol. 41(2), pages 236-249.
    16. Dimitris Bertsimas & Leonid Kogan & Andrew W. Lo, 2001. "Hedging Derivative Securities and Incomplete Markets: An (epsilon)-Arbitrage Approach," Operations Research, INFORMS, vol. 49(3), pages 372-397, June.
    17. Svetlozar T. Rachev & Stoyan V. Stoyanov & Frank J. Fabozzi, 2017. "Financial Markets With No Riskless (Safe) Asset," International Journal of Theoretical and Applied Finance (IJTAF), World Scientific Publishing Co. Pte. Ltd., vol. 20(08), pages 1-24, December.
    18. Robert A. Jarrow, 1999. "In Honor of the Nobel Laureates Robert C. Merton and Myron S. Scholes: A Partial Differential Equation That Changed the World," Journal of Economic Perspectives, American Economic Association, vol. 13(4), pages 229-248, Fall.
    19. René Carmona, 2022. "The influence of economic research on financial mathematics: Evidence from the last 25 years," Finance and Stochastics, Springer, vol. 26(1), pages 85-101, January.
    20. Josheski Dushko & Apostolov Mico, 2020. "A Review of the Binomial and Trinomial Models for Option Pricing and their Convergence to the Black-Scholes Model Determined Option Prices," Econometrics. Advances in Applied Data Analysis, Sciendo, vol. 24(2), pages 53-85, June.
    21. Bertsimas, Dimitris. & Kogan, Leonid, 1974- & Lo, Andrew W., 1997. "Pricing and hedging derivative securities in incomplete markets : an e-arbitrage approach," Working papers WP 3973-97., Massachusetts Institute of Technology (MIT), Sloan School of Management.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jrpoli:v:75:y:2022:i:c:s0301420721004670. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/30467 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.