[hr]Dr Graham Lumley from PricewaterhouseCooper’s new mining intelligence division examines trends in productivity of open cut mining equipment over the past 20 years.[hr]

Many people believe that 21st century open cut mining in Australia, or when being done by Australian companies, is a mature and efficient exercise. It might be mature but it is certainly nowhere near as efficient as it could be. This is despite significant improvements achieved over the last 20 years which have come about through the reduction of restrictive work practices and structural change in the industry. Shareholders have been told that Australian open cuts are now among the most efficient in the world. But the bottom line is the average mine or contractor is not doing the right thing by their shareholders and utilising the very expensive equipment at anything approaching best practice productivity.

While being of vital importance to the Australian economy, the mining industry from the early 1980s to the 1990s provided little in the way of profitability to the owners. During the 1960s and 1970s, an industry-wide culture of industrial deadlock and regulatory institutions that quarantined Australian operations from global competitive pressures, made workplace reform very difficult (Goldberg 2003). The wealth generated from mining operations provided relatively little for the shareholders. Australia went through a period of profitless prosperity. (Clifford 2002, p. 3). 

By the mid-1980s, parts of the Australian mining industry started to respond to the opportunities and threats of globalisation. For example, the experience at Robe River in Western Australia where Peko Wallsend terminated the workforce in 1986 due to restrictive work practices (Copeman 1990), was more than ten years prior to Rio Tinto taking on similar restrictive work practices in their coal mines. In terms of safety, productivity and profitability, by the 1990s coal operations were increasingly out of step (Goldberg 2003). During a six-week strike at one Rio Tinto coal mine the non-union employees (management, technical and administrative) ran the entire operation including operating the large mining equipment. The performance, under abnormal circumstances, was not high, but this exercise indicated the efficiencies that a more flexible operation could achieve (Davies 2001).

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“Australia is below the annual output of North America and above Africa (except for FELs) across all classes of equipment.”

[hr] While mining industry revenue has grown rapidly over the decade, the volume of output has only grown at an annual average rate of 3 per cent, despite mining employment more than doubling and strong growth in capital stock. As a consequence, both labour productivity and MFP have fallen from 2001, when commodity prices started rising sharply.

Draglines

A dragline consists of a bucket which is suspended from a boom (a large truss-like structure) with wire ropes. The bucket is manoeuvred by means of a number of ropes and chains. The hoist rope, powered by large electric motors, supports the bucket and hoist rigging assembly from the boom. The dragrope is used to move the bucket and rigging horizontally. By moving the hoist and the dragropes the bucket is controlled through the action of a third rope – the dump rope, which is part of the rigging. This system of having a bucket unconstrained is unique in earthmoving equipment. 

Draglines have been the primary stripping tool used on Australia’s coal mines since the early 1970s. They are the most expensive tool to purchase and the cheapest to operate ($/BCM). A total of 70 large (20 m3 – 120 m3 bucket rated capacity) walking draglines are currently used in Australia. While continuing to be an integral part of many coal mines, their precedence and use (as a percentage of the total stripping capacity) has fallen over the last 10 years. A number of companies (but not all) are choosing the more flexible truck and loader systems to support expansions and new mine developments.

The performance of draglines is based on annual output in bank cubic metres (normalised for full year operation) per tonne of rated suspended load (RSL). A bank cubic metre is the load in tonnes (as weighed by a monitor) divided by the in-situ specific gravity. The RSL is a number which the manufacturer places on the machine as being a safe working load.

Figure 1 is a plot showing the differences between Australian dragline performance and those in South Africa and North America (USA and Canada). These are the three predominant areas where large walking draglines are used. Draglines have been employed in Northern Africa and Europe but these have not been included due to lack of data and the generally smaller capacity in the case of Europe.

The same general trends can be seen in each country as is seen worldwide. There has been a peak between 2003 and 2006 with a subsequent decline. The decline is particularly evident in South Africa (-25%) and to a lesser extent in North America (-11%) and Australia (-9%).

Figure 2 shows the median annual output of Australian draglines broken down between Queensland and New South Wales. The early period between 1994 and 1997 saw median annual output of the NSW draglines underperform but improve rapidly and pass the Queensland median. The performance for both states improved over a number of years but post 2003 the Queensland draglines have declined (11%) and the NSW machines have maintained a higher level (decline has only been 5%).

The final comparison is by make and model. Figure 3 shows the 2010 median performance for each make and model.

It is important to note that this plot does not attempt to say whether the make and model results actually reflect better draglines or the operating characteristics of the sites at which they are used. A number of the larger draglines are the lower performers. The M8750/M8200S (which have been combined as they are a very similar capacity) and BE2570WS are 38% and 49% below the BE2570W. The P&H9020 is 23% below the BE2570W.

Electric Rope Shovels

An electric rope shovel (also stripping shovel or front shovel or electric mining shovel) is a bucket-equipped machine used for digging and loading earth or fragmented rock and for mineral extraction. Shovels normally consist of a revolving deck with a power plant, driving and controlling mechanisms, usually a counterweight, and a front attachment, such as a boom which supports a handle / dipper arm with a bucket / dipper at the end. The machinery is mounted on a base platform with tracks.

Rope shovels are used principally for excavation and removal of overburden in open-cut mining operations, though it may include loading of minerals, such as coal. Rope shovels exclusively load trucks for transporting material away from the loading area.

Electric Rope Shovels have gained significant usage on Australia’s coal mines since the 1990s. They are not as widely used as draglines but are gaining increasing numbers. They are not predominant outside the coal mines but are used by a number of hardrock mines and contractors.

Most rope shovels have 20 CuM+ dipper/bucket capacity. The latest large rope shovels have buckets >60CuM capacity with rated suspended loads up to 210 tonnes. They are not as efficient as a dragline in the percentage of material carried as a percentage of the material plus steel, however, they are more flexible than a dragline. They still suffer some inflexibility as most are electric and are not as flexible as a diesel loader. In bulk material movement large rope shovels can move material faster than the largest hydraulic excavators and front end loaders which have bucket capacities around 40CuM.

The performance of rope shovels is based on annual output in tonnes (normalised for full year operation) per cubic metre of bucket/dipper capacity. There is divergence between reporting of shovel performance in coal mines and hard rock mines. Coal mines report in bank cubic metres (tonnes/in-situ SG) while non-coal mines report in tonnes. In this article, performance has been presented in tonnes to allow consistency between electric rope shovels, hydraulic excavators and front end loaders (the primary classes of equipment loading trucks). Further to this the rating of the shovel is in CuM of bucket capacity. All shovels have a rated suspended load but this is not well understood and it is felt a more meaningful measure of a unit of input for a shovel is the bucket capacity. There is some inconsistency between how a rope shovel bucket capacity is defined and the way excavators and FELs are defined, however this does not detract from the message contained in the trends.

Figure 4 is a plot showing the differences between Australian rope shovel median performance and those in South Africa, North America and South America. Results have been normalised for split between coal and non-coal performance.

All countries demonstrate the same trend with the general decline in equipment performance being evident. North America has the highest annual output with Africa the lowest. Australia and South America are in between with Australia generally being above South America except for 2009-2010. The declines from the peak to 2010 are as follows; Australia 47%, South Africa 31%, North America 30% and South America 28%.

Figure 5 is the plot of difference between states in Australia. Rope shovels are predominantly used in NSW and Queensland.

Queensland had a peak in performance in 2006 followed by a 39% decline to 2010. NSW’s decline from 2003 to 2010 is greater at 47%. All states have seen a significant decline over the last 2-4 years. NSW has tended to underperform Queensland from 2003 – 2010.

The final comparison is by make and model. Figure 6 shows the 2010 median performance for each make and model.

It is important to note that, as was the case with the dragline comparison, this plot does not attempt to say whether the make and model results actually reflect better shovels or the operating characteristics of the sites at which they are used. The P&H shovels tend to have higher annual output than the BE (now Cat) shovels.

There is an interesting characteristic of this graph which is worth noting. The unit capacity increases with increasing machine size. This is not the same as draglines where a number of the larger draglines have lower annual unit output. Bigger machines move more than smaller machines even after the results are modified to normalise differences in the capacity of the dipper.

 

Hydraulic Excavators

Hydraulic excavators have had widespread use in the non-coal sectors over a number of decades but have increasingly been employed at coal mines during the last 10 years. Capacities range up to the 750+ tonne class machines which can have 40 + CuM capacity buckets. Most current excavators are in the 12 – 32 CuM capacity range. They are more flexible than a dragline and a shovel due to them running on diesel and not being constrained by the electricity cable. However, they are generally more expensive to operate on a per unit basis and do not move as much as a dragline nor a rope shovel.

While being a predominant source of stripping capacity in iron ore mines and other hard rock applications in Australia for a number of years, many existing and new coal mines are choosing hydraulic excavators for their additional or replacement capacity. Hydraulic excavators are predominantly used by contractors due to their flexibility.

Figure 7 is a plot showing the differences between Australian excavator median performance and those in South Africa, North America, South America and Asia. Results have been normalised for split between coal and non-coal performance.

All countries demonstrate the same general trend with the peak around 2006 – 2008 being evident.

Asia reports the highest excavator performance with Africa being the lowest. Australia is generally the next lowest, however, Australia, South America and North America are reasonably similar. All continents have a decline of between 18% in South America and 69% in South Africa. Australia had a decline of 49% from the peak in 2006 to 2010.

Figure 8 is the plot of difference between states in Australia. Sufficient data to provide statistical relevancy prior to 2005 in WA and 2006 in NSW is not available.

Queensland had a peak in performance in 2006/2007. WA experienced a peak in 2007. All states have seen a significant decline over the last 2-4 years with WA down 32%, Queensland down 45% and NSW down 51%. NSW has tended to underperform Queensland and WA   although prior to 2006 is unclear.

The final comparison is by make and model. Figure 9 shows the 2010 median performance for each make and model.

[hr]“Hydraulic excavators are predominantly used by contractors due to their flexibility.”[hr]

It is important to note that this plot does not attempt to say whether the make and model results actually reflect better machines or the operating characteristics of the sites at which they are used. It also doesn’t distinguish between shovel arrangement and backhoe arrangement. As was the case with electric rope shovels, larger equipment is proving to be more efficient than smaller equipment.

There are significant differences between different makes of excavator. By way of example, the Liebherr R996 median annual output per cubic metre of bucket capacity is 86% higher than the Komatsu PC5500, 54% higher than the Terex 340B (now Cat 6090), and 25% higher than the Hitachi EX5500. Each of these excavators are a similar operating weight.

Front End Loaders

A front end loader (also known as: bucket loader, front loader, payloader, scoop loader, shovel, skip loader, and/or wheel loader) is a type of tractor, usually wheeled, that has a front mounted square wide bucket connected to the end of two booms (arms) to scoop up material from the ground and move it from one place to another (usually a mining truck) without pushing the material across the ground.

The largest front end loader in the world is LeTourneau L2350. The L2350 uses a diesel electric propulsion system. Each rubber tyred wheel is driven by its own independent electric motor.

Front end loaders (FELs), have had widespread use in the mining industry (both coal and non-coal) over a number of decades both as primary stripping tools and as ancillary support equipment.

Capacities range up to the LeTorneau L2350 which can utilise a 40 + CuM capacity bucket. Most current FELs are in the 12 – 30 CuM capacity range. They are more flexible than any other loading tool but can have height limitations with the larger mining trucks. FELs are generally more expensive to operate on a per unit basis and do not move as much as other loading tools. FELs are measured on annual tonnes (normalised for full year operation) per cubic metre of bucket capacity.

Figure 10 is a plot showing the differences between Australian excavator median performance and those in South Africa, North America, South America and Asia. Results have been normalised for the split between coal and non-coal performance. All countries demonstrate the same general trend as with other loading units with the peak around 2006-2008 being evident.

Figure 11 is the plot of difference between states in Australia. Sufficient data to provide statistical relevancy prior to 2005 in WA and 2006 in NSW is not available.

All states had a peak in performance in 2006. All states have seen a significant decline over the last 2-4 years although these results are more variable than other types of loaders. Queensland has tended to underperform NSW and WA.

The final comparison is by make and model. Figure 12 shows the 2010 median performance for each FEL make and model.

[hr]“Front end loaders (FELs), have had widespread use in the mining industry (both coal and non-coal) over a number of decades both as primary stripping tools and as ancillary support equipment.”[hr]

The different designations (usually A, B, etc used by Cat) have not been separated in this analysis. The capacities are generally similar as is the output. It is important to note that this plot does not attempt to say whether the make and model results actually reflect better machines or the operating characteristics of the sites at which they are used. It also doesn’t distinguish between shovel arrangement and backhoe arrangement. As was the case with electric rope shovels and hydraulic excavators, larger equipment is proving to be more efficient than smaller equipment. There are significant differences between different makes of excavator. The LeTorneau L1850 and Cat994 are the top performing FELs.

 

Dr Graham Lumley

Mining Intelligence & Benchmarking group
PricewaterhouseCoopers

Dr Graham Lumley graduated from the University of Queensland in 1985 with a Bachelor of Engineering (Mining) with First Class Honours. Graham holds two patents in dragline bucket design and while his doctoral work on equipment operator selection was nominated as one of the 50 outstanding engineering achievements in Australia in 2007, Graham’s real passion is in mining analytics.  He has built a vast and unique resource of mining equipment productivity and reliability data since 1992. This resource and associated IP was acquired by PricewaterhouseCoopers in 2013 to enhance their consulting work in mining productivity.  Graham now heads up PwC’s newly formed Mining Intelligence and Benchmarking group based in Brisbane.

References

Clifford, L 2002, Mining: The way ahead, address presented to the Melbourne Mining Club, Melbourne, 22 August.

Connolly, E. and Orsmond, D., 2011, .The mining industry: From Bust to Boom., paper prepared for the Reserve Bank of Australia Conference Australia in the 2000s at the H.C. Coombs Centre for Financial Studies, Sydney, August.

Copeman, C. 1990 Robe River revisited, Proceedings of the H.R. Nicholls Society, March, Sydney, accessed 26 February 2009.< http://www.hrnicholls.com.au/archives/vol8/vol8-contents.php>.

Davies A 2001, .Coal reform: The Hunter Valley no. 1 story., accessed 26 February 2009, <http://www.hrnicholls.com.au/nicholls/nichvo22/davies2001.html>

Goldberg, G 2003, .Challenges for Australian coal in a new era., keynote address to Coaltrans Conference, Sydney, 10 March.

Lumley G 2009, How can you get mining equipment to work to its real capacity?, AUSIMM – New Leaders. Conference, 29 – 30 April, Brisbane, Australia