Introduction: Best Practice and Industry Trends
Best Practice Real Value
Best Practice Benefits
Best Practice Checklist
Traceability: The system should allow you to trace which ore blocks are being fed to the plant. You should be able to track geological domains, ore blocks, and grades delivered to the plant over a particular time period.
Accuracy: The system should be accurate and reliable, and it should not rely on a single user. Any suitably authorized user should be able to follow a clear procedure to generate the month-end metal accounts.
Month-end Reports: Authorized users should be able to generate month-end metal accounts. The reports should provide a clear overview of the production process, including the quantities of metal mined, delivered to the plant, held within the plant's circuits, lost to waste, and processed by the plant.
Data Management: A comprehensive data management system should be in place to capture and store all relevant data. The system should be capable of handling large volumes of data and should be designed to minimize errors and inconsistencies.
Stakeholder Involvement: All stakeholders should be involved in the metallurgical accounting process, including mine operators, plant operators, geologists, and financial analysts. This will ensure that everyone has a clear understanding of the process and can contribute to its ongoing improvement.
Review and Audit: Regular reviews and audits should be conducted to ensure the accuracy and consistency of the data. Any discrepancies should be investigated and resolved promptly.
Adjustments: The system should be able to handle adjustments robustly. Late arriving changes or late detected errors should be handled within the system, and an average user or auditor should be able to trace these late updates and their effect on the published results.
Transparency: The system should be transparent, and all calculations and assumptions used in the process should be clearly documented. This includes the source of data, calculation methodologies, and any adjustments made. Integration: The metallurgical accounting system should be integrated with other systems used in the operation, including mine planning, process control, and financial systems.
Training and Support: Adequate training and support should be provided to all users of the system, including operators, analysts, and auditors. This will ensure that everyone has a clear understanding of the system and can use it effectively.
Transparency and Auditability: The system should be transparent and auditable. Auditors and general users should be able to trace from published accounts through to raw input data and all the calculations in between. There should be no breaks in the system audit trail, such as arising from copying and pasting of data.
Trending of Reconciled Data and Recoveries: It should be possible to trend reconciled data and recoveries. It should be easy to extract derived plant performance KPIs over long periods, such as unit process recovery performance. This is extremely useful for justifying plant capital spending or optimization work.
Timeliness: The system should be capable of providing timely and accurate information to support decision-making. Reports should be available on a regular basis, and any issues or discrepancies should be identified and addressed promptly.
Continuous Improvement: The system should be subject to continuous improvement, with regular reviews and updates to ensure that it remains effective and efficient. This includes incorporating feedback from stakeholders and keeping up-to-date with the latest technologies and industry trends.
Standardization: The system should be standardized, with consistent processes and procedures in place across all operations. This will ensure that data is comparable and consistent, allowing for meaningful analysis and benchmarking.
Quality Control: Assay quality control procedures should be in place and results regularly reviewed. Biases or excess variability in analytical data around key streams can significantly affect the apparent plant performance, thereby masking hidden losses. Sampling and analysis quality control should be built into the metal accounting process so that it is reviewed on a regular basis.
Automated Data Quality Checks: There should be adequate and automated data quality checks within the system. Data validation procedures should be automated, and users should be alerted early when there are issues. There are multiple levels of validation to be considered, including simple data point validation, validation across the flowsheet for a single period, and validation over time (i.e. outlier detection).
Timely Corrections: The system should allow for timely corrections of errors or discrepancies in the data. Corrections should be made promptly, and there should be a clear process for identifying and addressing any issues. Robustness: The system should be robust, with built-in redundancy and fail-safes to prevent data loss or corruption. There should be regular backups and disaster recovery plans in place to ensure that data is not lost in the event of a system failure or other unexpected event.
Data Integration: The system should be capable of integrating data from multiple sources, including laboratory assays, plant data, and financial systems. This will allow for a more complete and accurate picture of the operation, enabling better decision-making.
Inventory Adjustments: Adequate controls and procedures should be in place to ensure that any adjustments to inventory are properly authorized and recorded, and that the financial impact of such adjustments is well understood. This includes defining the reasons for inventory adjustments and ensuring that they are accurately reflected in the metal accounting system. Additionally, the system should have appropriate security measures to prevent unauthorized adjustments or tampering with inventory data.
Risk Assessments and Audits: Incorporating the outcomes of risk assessments and audits into the metal accounting system is crucial for maintaining a robust and reliable system. Regular audits are necessary to ensure that the system is operating effectively and efficiently, and to identify any potential issues or weaknesses that may need to be addressed. The metal accounting system should be designed to incorporate the findings and recommendations of these audits, with appropriate actions taken to address any identified risks or issues. For example, if an audit identifies a risk of inaccurate reporting of metal production due to incomplete or inconsistent data, the system should be updated to include more rigorous data validation and quality control procedures to ensure accurate reporting. By incorporating the outcomes of risk assessments and audits into the metal accounting system, mining companies can ensure that the system remains compliant with regulations and standards, and that it continues to operate effectively and efficiently. This can help to minimize the risk of financial losses, reputational damage, and non-compliance, and can provide greater confidence in the accuracy and reliability of the reported production data.
Capturing of Raw data:
Capturing the reason for any changes to raw data is crucial in ensuring the integrity and accuracy of the metal accounting system. Without this information, it can be difficult to determine the validity of the changes and could lead to inconsistencies or errors in the data.Automated Data Capturing: automated data capturing is a key component of a well-designed metal accounting system. By reducing the amount of manual data entry required, the risk of transcription errors is minimized, and the process becomes more efficient. This also allows the system to update in real-time, providing up-to-date information to decision-makers. Additionally, automated data capture can improve the accuracy and consistency of data, as it eliminates the potential for human error
Analysing the results: Analyzing the results of the metal accounting process is a critical step in the overall process. The results should provide insights that enable proactive risk management, timely and accurate recognition of revenue, and enhanced production performance measurement. Proactive risk management involves identifying potential risks and taking actions to mitigate or avoid them. For example, if metal losses are identified in a specific process, steps can be taken to optimize that process and reduce losses.
Timely and accurate recognition of revenue is important for financial reporting and decision-making. Metal accounting can provide accurate and timely information on the quantity and value of metals produced, which is essential for determining revenue and profitability.
Enhanced production performance measurement involves using metal accounting data to measure the performance of various processes and units within the operation. This information can be used to optimize processes and improve overall efficiency. Overall, the metal accounting process should provide enough flexibility to cater to diverse site and business requirements while enabling the use of a single solution across all operations. This can help ensure consistency and accuracy in the metal accounting process, regardless of the location or type of operation.
Result Analysis: All of these are important benefits that can be achieved through effective result analysis in metal accounting. Early detection of plant performance and measurement problems can lead to timely corrective action, minimizing losses and maximizing recovery. Bonus scheme calculations can be accurately calculated, providing a fair and equitable distribution of incentives. Improved production planning and forecasting can lead to more efficient operations, reducing costs and increasing profitability. Timely and relevant production information for the monthly financial reporting cycle can enable better decision making and improved financial performance. Increased accuracy in matching production costs to stages in the production process can help identify areas for improvement and cost savings. Finally, accurate calculation of royalty payments can ensure compliance with regulations and avoid penalties or legal issues.
Keeping Abreast with Industry trends
The use of digital technologies:
This data can then be transmitted to a central database, where it can be analyzed and used to optimize the metallurgical process. For example, in a copper concentrator plant, IoT sensors can be used to monitor the amount of copper in the ore as it is processed through the flotation circuit. This information can be used to adjust the reagent dosage in real-time, which can increase copper recovery and reduce the amount of reagents used. This not only improves plant performance but also reduces costs associated with reagent consumption.
Cloud computing is another digital technology that is being used in metallurgical accounting. Cloud computing enables data to be stored, processed, and analyzed remotely, providing easy access to data from anywhere with an internet connection. This can be particularly useful for mining companies that have multiple sites in different locations. For example, a mining company may have a copper concentrator plant in Chile and a gold mine in Australia. By using cloud computing, the company can store and process all the data from both sites in a central database, enabling them to compare performance and identify areas for improvement.
This can also help with remote monitoring of the metallurgical process, allowing for early detection of problems and faster response times. Overall, the use of digital technologies such as IoT sensors and cloud computing in metallurgical accounting can help mining companies automate and streamline their processes, leading to increased efficiency, improved plant performance, and reduced costs.
Increased focus on sustainability:
As mining companies adopt more environmentally friendly processes and reduce waste, they need to ensure that their metal accounting process can accurately track the flow of materials and resources throughout the operation. For example, a mining company may implement a process to recycle water within their operation.
This process can help reduce the amount of water used by the operation and minimize the impact on local water resources. However, this also means that the metal accounting process needs to accurately track the flow of water throughout the operation, including the amount of water used in different processes and the amount of recycled water used.
Failure to accurately track the flow of water can result in inaccurate metal accounting and financial reporting, which can impact the economic viability of the operation. In addition, the adoption of more sustainable processes may require additional monitoring and reporting requirements. For example, a mining company may need to track the amount of greenhouse gas emissions generated by their operation.
This data can then be used to report on the company's environmental performance and compliance with regulatory requirements. The metal accounting process needs to be flexible enough to capture this additional data and integrate it into the overall reporting process.
Overall, the increased focus on sustainability in the mining industry highlights the importance of an accurate and robust metal accounting process. By accurately tracking the flow of materials and resources throughout the operation, mining companies can optimize their operations and ensure their economic viability while minimizing their impact on the environment.
Greater collaboration and transparency:
Collaboration with regulators: Mining companies can work closely with regulators to ensure compliance with environmental and safety regulations. By providing regular updates on their operations and sharing data with regulators, mining companies can build trust and credibility, which can lead to smoother regulatory approvals and fewer delays in the metal accounting process.
Collaboration with customers: Mining companies can collaborate with customers to ensure that the quality of the metal produced meets their requirements. By sharing data on the quality of the metal and working together to identify areas for improvement, mining companies can ensure that they are producing metal that meets the needs of their customers.
Collaboration with local communities: Mining companies can work closely with local communities to ensure that their operations are sustainable and that they are minimizing their impact on the environment. By sharing data on their environmental performance and engaging in dialogue with local communities, mining companies can build trust and goodwill, which can lead to greater support for their operations.
Greater transparency: Mining companies can provide greater transparency around their operations by publishing sustainability reports and providing regular updates on their environmental and social performance. This can help to build trust with stakeholders and can help to ensure that the metal accounting process is viewed as credible and trustworthy.
In summary, greater collaboration and transparency in the mining industry can help to build trust with stakeholders, which can have a positive impact on the metal accounting process. By working closely with regulators, customers, and local communities, and by providing greater transparency around their operations, mining companies can ensure that they are producing metal in a sustainable and socially responsible manner.
Adoption of blockchain technology:
Here are some examples of how blockchain technology is being used in the mining industry:
Ethical sourcing: Blockchain technology is being used to track minerals from the mine to the end user, ensuring that they are ethically sourced. For example, IBM and MineHub are developing a blockchain-based platform that will allow miners to track the movement of minerals from the mine to the smelter, refinery, and ultimately the end user. This will enable customers to verify the source of the minerals and ensure that they are not sourced from conflict areas or other unethical sources.
Improved supply chain management: Blockchain technology is being used to improve supply chain management in the mining industry. For example, BHP has developed a blockchain-based platform called "Mine to Market" that will enable the company to track the movement of minerals from the mine to the end user. This will enable BHP to improve supply chain efficiency and reduce costs.
Streamlined metal accounting: Blockchain technology is being used to streamline the metal accounting process in the mining industry. For example, mining company Goldcorp has partnered with blockchain technology company Tradewind Markets to develop a blockchain-based platform that will allow the company to track the movement of gold from the mine to the refinery.
This will enable Goldcorp to streamline the metal accounting process and improve the accuracy of its financial reporting.
Overall, the adoption of blockchain technology in the mining industry is having a significant impact on the industry, improving transparency, supply chain management, and metal accounting. As more companies adopt blockchain technology, we can expect to see further improvements in these areas, as well as new use cases for the technology in the mining industry.
Increased use of data analytics:
For example, data analytics can help identify and address issues related to metal recovery, which is critical to the profitability of a mining operation. By analyzing data from various sources, such as production data, metallurgical testwork, and plant surveys, mining companies can identify factors that affect metal recovery, such as feed grades, circuit performance, and operating conditions.
This information can then be used to optimize processes and improve metal recovery, thereby increasing the profitability of the operation. Data analytics can also help identify and address issues related to metal accounting. By analyzing data from various sources, such as production data, inventory data, and sales data, mining companies can identify discrepancies in their metal accounting process, such as unexplained losses or gains, and take corrective actions.
This information can also be used to improve the accuracy and efficiency of the metal accounting process, by automating data capture and validation, and reducing the need for manual intervention.
Overall, the increased use of data analytics in the mining industry has enabled mining companies to improve the accuracy and efficiency of their metallurgical accounting processes, and to identify areas for process optimization and improvement, leading to increased profitability and operational efficiency.
Blockchain is a revolutionary technology because it creates a single source of truth by maintaining the same copy of the database on all computers. The transactions recorded on the blockchain are immutable, which means they cannot be falsified at a later date. This technology creates privacy like never before through an encoding mechanism that makes it impossible to go back and figure out what has been encoded. Trust between parties is elevated to a level of mathematical algorithm, which takes it away from a central authority and gives it over to mathematics. Blockchain creates a world where it is practically impossible to lie without being caught.
It is important to note that blockchain is not just about bitcoin or cryptocurrency, but it is bigger than that. The mechanisms that created blockchain were known for some years, but they were all pulled together relatively recently when a mysterious character named Satoshi Nakamoto published a white paper in 2009 describing the mechanism for transaction of value on this ledger from peer to peer without central authority, and then Bitcoin was born.
The key mechanism of blockchain is encryption and the digital fingerprint, which is a unique identifier for a file or document. The digital fingerprint is unique to the document, but it is not possible to decipher back what document it is. The hashing process converts any file or document into a string of 256 digits and is further converted into just 64 digits that represent 32 bits. Each of these final 64-digit strings is unique to the original file.
The transition from file of the file from one user to another is also hashed, which means that the fact that this transition happened also has a digital fingerprint. Blockchain also provides zero-knowledge proof, which means that it is possible to prove that a document is the right one without revealing the content of the document.
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Technical Stewardship
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Basdew Rooplal
Managing Director at Supergold
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