Strategic project evaluation for open pit mining ventures using real options and allied econometric techniques

Open pit mine operations are complex businesses that demand a constant assessment of risk. This is because the value of a mine project is typically influenced by many underlying economic and physical uncertainties, such as metal prices, metal grades, costs, schedules, quantities, and environmental issues, among others, which are not known with much certainty at the beginning of the project. Hence, mining projects present a considerable challenge to those involved in associated investment decisions, such as the owners of the mine and other stakeholders. In general terms, when an option exists to acquire a new or operating mining project, , the owners and stock holders of the mine project need to know the value of the mining project, which is the fundamental criterion for making final decisions about going ahead with the venture capital. However, obtaining the mine project’s value is not an easy task. The reason for this is that sophisticated valuation and mine optimisation techniques, which combine advanced theories in geostatistics, statistics, engineering, economics and finance, among others, need to be used by the mine analyst or mine planner in order to assess and quantify the existing uncertainty and, consequently, the risk involved in the project investment. Furthermore, current valuation and mine optimisation techniques do not complement each other. That is valuation techniques based on real options (RO) analysis assume an expected (constant) metal grade and ore tonnage during a specified period, while mine optimisation (MO) techniques assume expected (constant) metal prices and mining costs. These assumptions are not totally correct since both sources of uncertainty—that of the orebody (metal grade and reserves of mineral), and that about the future behaviour of metal prices and mining costs—are the ones that have great impact on the value of any mining project. Consequently, the key objective of this thesis is twofold. The first objective consists of analysing and understanding the main sources of uncertainty in an open pit mining project, such as the orebody (in situ metal grade), mining costs and metal price uncertainties, and their effect on the final project value. The second objective consists of breaking down the wall of isolation between economic valuation and mine optimisation techniques in order to generate a novel open pit mine evaluation framework called the ―Integrated Valuation / Optimisation Framework (IVOF)‖. One important characteristic of this new framework is that it incorporates the RO and MO valuation techniques into a single integrated process that quantifies and describes uncertainty and risk in a mine project evaluation process, giving a more realistic estimate of the project’s value. To achieve this, novel and advanced engineering and econometric methods are used to integrate financial and geological uncertainty into dynamic risk forecasting measures. The proposed mine valuation/optimisation technique is then applied to a real gold disseminated open pit mine deposit to estimate its value in the face of orebody, mining costs and metal price uncertainties.

Data modelling with first-grade students

This paper argues for a renewed focus on statistical reasoning in the beginning school years, with opportunities for children to engage in data modelling. Results are reported from the first year of a 3-year longitudinal study in which three classes of first-grade children (6-year-olds) and their teachers engaged in data modelling activities. The theme of Looking after our Environment, part of the children’s science curriculum, provided the task context. The goals for the two activities addressed here included engaging children in core components of data modelling, namely, selecting attributes, structuring and representing data, identifying variation in data, and making predictions from given data. Results include the various ways in which children represented and re represented collected data, including attribute selection, and the metarepresentational competence they displayed in doing so. The “data lenses” through which the children dealt with informal inference (variation and prediction) are also reported.

Field study of air change and flow rate in six automobiles

For many people, a relatively large proportion of daily exposure to a multitude of pollutants may occur inside an automobile. A key determinant of exposure is the amount of outdoor air entering the cabin (i.e. air change or flow rate). We have quantified this parameter in six passenger vehicles ranging in age from 18 years to <1 year, at three vehicle speeds and under four different ventilation settings. Average infiltration into the cabin with all operable air entry pathways closed was between 1 and 33.1 air changes per hour (ACH) at a vehicle speed of 60 km/h, and between 2.6 and 47.3 ACH at 110 km/h, with these results representing the most (2005 Volkswagen Golf) and least air-tight (1989 Mazda 121) vehicles, respectively. Average infiltration into stationary vehicles parked outdoors varied between ~0 and 1.4 ACH and was moderately related to wind speed. Measurements were also performed under an air recirculation setting with low fan speed, while airflow rate measurements were conducted under two non-recirculate ventilation settings with low and high fan speeds. The windows were closed in all cases, and over 200 measurements were performed. The results can be applied to estimate pollutant exposure inside vehicles.

Multi-body modelling of wagon trains for crashworthiness analysis

Three-dimensional wagon train models have been developed for the crashworthiness analysis using multi-body dynamics approach. The contributions of the train size (number of wagon) to the frontal crash forces can be identified through the simulations. The effects of crash energy management (CEM) design and crash speed on train crashworthiness are examined. The CEM design can significantly improve the train crashworthiness and the consequential vehicle stability performance - reducing derailment risks.

Mathematical modelling of tumour-induced angiogenesis

The growth of solid tumours beyond a critical size is dependent upon angiogenesis, the formation of new blood vessels from an existing vasculature. Tumours may remain dormant at microscopic sizes for some years before switching to a mode in which growth of a supportive vasculature is initiated. The new blood vessels supply nutrients, oxygen, and access to routes by which tumour cells may travel to other sites within the host (metastasize). In recent decades an abundance of biological research has focused on tumour-induced angiogenesis in the hope that treatments targeted at the vasculature may result in a stabilisation or regression of the disease: a tantalizing prospect. The complex and fascinating process of angiogenesis has also attracted the interest of researchers in the field of mathematical biology, a discipline that is, for mathematics, relatively new. The challenge in mathematical biology is to produce a model that captures the essential elements and critical dependencies of a biological system. Such a model may ultimately be used as a predictive tool. In this thesis we examine a number of aspects of tumour-induced angiogenesis, focusing on growth of the neovasculature external to the tumour. Firstly we present a one-dimensional continuum model of tumour-induced angiogenesis in which elements of the immune system or other tumour-cytotoxins are delivered via the newly formed vessels. This model, based on observations from experiments by Judah Folkman et al., is able to show regression of the tumour for some parameter regimes. The modelling highlights a number of interesting aspects of the process that may be characterised further in the laboratory. The next model we present examines the initiation positions of blood vessel sprouts on an existing vessel, in a two-dimensional domain. This model hypothesises that a simple feedback inhibition mechanism may be used to describe the spacing of these sprouts with the inhibitor being produced by breakdown of the existing vessel's basement membrane. Finally, we have developed a stochastic model of blood vessel growth and anastomosis in three dimensions. The model has been implemented in C++, includes an openGL interface, and uses a novel algorithm for calculating proximity of the line segments representing a growing vessel. This choice of programming language and graphics interface allows for near-simultaneous calculation and visualisation of blood vessel networks using a contemporary personal computer. In addition the visualised results may be transformed interactively, and drop-down menus facilitate changes in the parameter values. Visualisation of results is of vital importance in the communication of mathematical information to a wide audience, and we aim to incorporate this philosophy in the thesis. As biological research further uncovers the intriguing processes involved in tumourinduced angiogenesis, we conclude with a comment from mathematical biologist Jim Murray, Mathematical biology is : : : the most exciting modern application of mathematics.

Numerical Modelling of LiteSteel Beams Subject to Shear

Abstract: LiteSteel beam (LSB) is a new cold-formed steel hollow flange channel beam produced using a patented manufacturing process involving simultaneous cold-forming and dual electric resistance welding. It has the beneficial characteristics of torsionally rigid closed rectangular flanges combined with economical fabrication processes from a single strip of high strength steel. Although the LSB sections are commonly used as flexural members, no research has been undertaken on the shear behaviour of LSBs. Therefore experimental and numerical studies were undertaken to investigate the shear behaviour and strength of LSBs. In this research finite element models of LSBs were developed to investigate their nonlinear shear behaviour including their buckling characteristics and ultimate shear strength. They were validated by comparing their results with available experimental results. The models provided full details of the shear buckling and strength characteristics of LSBs, and showed the presence of considerable improvements to web shear buckling in LSBs and associated post-buckling strength. This paper presents the details of the finite element models of LSBs and the results. Both finite element analysis and experimental results showed that the current design rules in cold-formed steel codes are very conservative for the shear design of LSBs. The ultimate shear capacities from finite element analyses confirmed the accuracy of proposed shear strength equations for LSBs based on the North American specification and DSM design equations. Developed finite element models were used to investigate the reduction to shear capacity of LSBs when full height web side plates were not used or when only one web side plate was used, and these results are also presented in this paper.

Scaling for the Prandtl number of the natural convection boundary layer of an inclined flat plate under uniform surface heat flux

An improved scaling analysis and direct numerical simulations are performed for the unsteady natural convection boundary layer adjacent to a downward facing inclined plate with uniform heat flux. The development of the thermal or viscous boundary layers may be classified into three distinct stages: a start-up stage, a transitional stage and a steady stage, which can be clearly identified in the analytical as well as the numerical results. Previous scaling shows that the existing scaling laws of the boundary layer thickness, velocity and steady state time scale for the natural convection flow on a heated plate of uniform heat flux provide a very poor prediction of the Prandtl number dependency of the flow. However, those scalings perform very well with Rayleigh number and aspect ratio dependency. In this study, a modified Prandtl number scaling is developed using a triple layer integral approach for Pr > 1. It is seen that in comparison to the direct numerical simulations, the modified scaling performs considerably better than the previous scaling.

Numerical modelling of non-load bearing light gauge cold-formed steel frame walls under fire conditions

Recently an innovative composite panel system was developed, where a thin insulation layer was used externally between two plasterboards to improve the fire performance of light gauge cold-formed steel frame walls. In this research, finite-element thermal models of both the traditional light gauge cold-formed steel frame wall panels with cavity insulation and the new light gauge cold-formed steel frame composite wall panels were developed to simulate their thermal behaviour under standard and realistic fire conditions. Suitable apparent thermal properties of gypsum plasterboard, insulation materials and steel were proposed and used. The developed models were then validated by comparing their results with available fire test results. This article presents the details of the developed finite-element models of small-scale non-load-bearing light gauge cold-formed steel frame wall panels and the results of the thermal analysis. It has been shown that accurate finite-element models can be used to simulate the thermal behaviour of small-scale light gauge cold-formed steel frame walls with varying configurations of insulations and plasterboards. The numerical results show that the use of cavity insulation was detrimental to the fire rating of light gauge cold-formed steel frame walls, while the use of external insulation offered superior thermal protection to them. The effects of real fire conditions are also presented.

Defining standards for modelling the biomechanics of the foot and ankle : a systematic review

The complex interaction of the bones of the foot has been explored in detail in recent years, which has led to the acknowledgement in the biomechanics community that the foot can no longer be considered as a single rigid segment. With the advance of motion analysis technology it has become possible to quantify the biomechanics of simplified units or segments that make up the foot. Advances in technology coupled with reducing hardware prices has resulted in the uptake of more advanced tools available for clinical gait analysis. The increased use of these techniques in clinical practice requires defined standards for modelling and reporting of foot and ankle kinematics. This systematic review aims to provide a critical appraisal of commonly used foot and ankle marker sets designed to assess kinematics and thus provide a theoretical background for the development of modelling standards.

Realising dead path elimination in BPMN

The Web Service Business Process Execution Language (BPEL) lacks any standard graphical notation. Various efforts have been undertaken to visualize BPEL using the Business Process Modelling Notation (BPMN). Although this is straightforward for the majority of concepts, it is tricky for the full BPEL standard, partly due to the insufficiently specified BPMN execution semantics. The upcoming BPMN 2.0 revision will provide this clear semantics. In this paper, we show how the dead path elimination (DPE) capabilities of BPEL can be expressed with this new semantics and discuss the limitations. We provide a generic formal definition of DPE and discuss resulting control flow requirements independent of specific process description languages.

Determinants of driver vs. second row occupant posture modelling

Digital human modeling (DHM), as a convenient and cost-effective tool, is increasingly incorporated into product and workplace design. In product design, it is predominantly used for the development of driver-vehicle systems. Most digital human modeling software tools, such as JACK, RAMSIS and DELMIA HUMANBUILDER provide functions to predict posture and positions for drivers with selected anthropometry according to SAE (Society of Automotive Engineers) Recommended Practices and other ergonomics guidelines. However, few studies have presented 2nd row passenger postural information, and digital human modeling of these passenger postures cannot be performed directly using the existing driver posture prediction functions. In this paper, the significant studies related to occupant posture and modeling were reviewed and a framework of determinants of driver vs. 2nd row occupant posture modeling was extracted. The determinants which are regarded as input factors for posture modeling include target population anthropometry, vehicle package geometry and seat design variables as well as task definitions. The differences between determinants of driver and 2nd row occupant posture models are significant, as driver posture modeling is primarily based on the position of the foot on the accelerator pedal (accelerator actuation point AAP, accelerator heel point AHP) and the hands on the steering wheel (steering wheel centre point A-Point). The objectives of this paper are aimed to investigate those differences between driver and passenger posture, and to supplement the existing parametric model for occupant posture prediction. With the guide of the framework, the associated input parameters of occupant digital human models of both driver and second row occupant will be identified. Beyond the existing occupant posture models, for example a driver posture model could be modified to predict second row occupant posture, by adjusting the associated input parameters introduced in this paper. This study combines results from a literature review and the theoretical modeling stage of a second row passenger posture prediction model project.

Human seat modelling using inverse dynamic musculoskeletal models

In this work a biomechanical model is used for simulation of muscle forces necessary to maintain the posture in a car seat under different support conditions.

Defining standards for modelling the biomechanics of the foot and ankle: A systematic review

The complex interaction of the bones of the foot has been explored in detail in recent years, which has led to the acknowledgement in the biomechanics community that the foot can no longer be considered as a single rigid segment. With the advance of motion analysis technology it has become possible to quantify the biomechanics of simplified units or segments that make up the foot. Advances in technology coupled with reducing hardware prices has resulted in the uptake of more advanced tools available for clinical gait analysis. The increased use of these techniques in clinical practice requires defined standards for modelling and reporting of foot and ankle kinematics. This systematic review aims to provide a critical appraisal of commonly used foot and ankle marker sets designed to assess kinematics and thus provide a theoretical background for the development of modelling standards.

Digital human modelling for vehicle design and manufacturing

Digital human modelling (DHM) has today matured from research into industrial application. In the automotive domain, DHM has become a commonly used tool in virtual prototyping and human-centred product design. While this generation of DHM supports the ergonomic evaluation of new vehicle design during early design stages of the product, by modelling anthropometry, posture, motion or predicting discomfort, the future of DHM will be dominated by CAE methods, realistic 3D design, and musculoskeletal and soft tissue modelling down to the micro-scale of molecular activity within single muscle fibres. As a driving force for DHM development, the automotive industry has traditionally used human models in the manufacturing sector (production ergonomics, e.g. assembly) and the engineering sector (product ergonomics, e.g. safety, packaging). In product ergonomics applications, DHM share many common characteristics, creating a unique subset of DHM. These models are optimised for a seated posture, interface to a vehicle seat through standardised methods and provide linkages to vehicle controls. As a tool, they need to interface with other analytic instruments and integrate into complex CAD/CAE environments. Important aspects of current DHM research are functional analysis, model integration and task simulation. Digital (virtual, analytic) prototypes or digital mock-ups (DMU) provide expanded support for testing and verification and consider task-dependent performance and motion. Beyond rigid body mechanics, soft tissue modelling is evolving to become standard in future DHM. When addressing advanced issues beyond the physical domain, for example anthropometry and biomechanics, modelling of human behaviours and skills is also integrated into DHM. Latest developments include a more comprehensive approach through implementing perceptual, cognitive and performance models, representing human behaviour on a non-physiologic level. Through integration of algorithms from the artificial intelligence domain, a vision of the virtual human is emerging.

Numerical modelling and design of LiteSteel Beams subject to lateral buckling

The LiteSteel Beam (LSB) is a new hollow flange channel section developed using a patented dual electric resistance welding and cold-forming process. It has a unique geometry consisting of torsionally rigid rectangular hollow flanges and a slender web, and is commonly used as flexural members. However, the LSB flexural members are subjected to a relatively new lateral distortional buckling mode, which reduces their moment capacities. Unlike lateral torsional buckling, the lateral distortional buckling of LSBs is characterised by simultaneous lateral deflection, twist and cross sectional change due to web distortion. Therefore a detailed investigation into the lateral buckling behaviour of LSB flexural members was undertaken using experiments and finite element analyses. This paper presents the details of suitable finite element models developed to simulate the behaviour and capacity of LSB flexural members subject to lateral buckling. The models included all significant effects that influence the ultimate moment capacities of such members, including material inelasticity, lateral distortional buckling deformations, web distortion, residual stresses, and geometric imperfections. Comparison of elastic buckling and ultimate moment capacity results with predictions from other numerical analyses and available buckling moment equations, and experimental results showed that the developed finite element models accurately predict the behaviour and moment capacities of LSBs. The validated model was then used in a detailed parametric study that produced accurate moment capacity data for all the LSB sections and improved design rules for LSB flexural members subject to lateral distortional buckling.