Choosing the right equipment for the job is a big driver of total $/t costs for a mine site. But potentially even more important is the way in which that equipment is maintained.
Direct maintenance costs vary widely between operators and equipment types. These costs include labour and components as well as preventable, corrective and accidental damage. They do not include tyres or tyre-changing costs, fuel, downtime costs, infrastructure costs such as cranage, or supervision and support labour costs.
Factors such as component life, work management systems, quality of work, component cost agreements, rebuild specifications and labour management all impact on costs over the life of the machine. Therefore, it is generally the maintenance practices that drive outcomes.
So how do you ensure your site’s maintenance practices aren’t driving up costs? A good place to start is an expert review of your mining practices against benchmarked industry data. Emeco is highly experienced at identifying cost reduction opportunities in maintenance and mining processes.
Maintaining a truck cost-efficiently will have a greater impact over time than the actual selection of the right truck to begin with. In other words, the decision to use a 150t versus a 190t is less important than the maintenance and operation of that equipment. However, getting both correct is the overall goal!
The following graph shows the range in direct maintenance costs for a CAT 793D truck, based on Red Button Group’s International Benchmarking Database. The database, sourced from more than 400 operating sites, has been normalised for operating conditions and lifecycle positions to provide a credible reference for site maintenance cost comparisons.
WHOLE OF LIFE COST – Industry Comparison
When reviewing the difference between efficient and poor maintenance performance, the following three drivers are the most important:
- Major component hourly (cost driven by both component cost and life)
- Scheduled servicing costs
- Labour efficiency and effectiveness.
Benchmark comparisons are valuable in identifying opportunities, however it is perilous to compare direct maintenance costs between sites without normalising for key factors as this can lead to very destructive actions. Enter Emeco’s production benchmarking process. Through the Emeco Operating System (EOS) we can combine an operational assessment and value driver tree to identify which actions will actually reduce mining costs.
Normalisation is the key
When looking at direct maintenance costs, it is not possible to validly compare a truck that is 10,000 – 15,000 hours in the lifecycle, with a truck that is 15,000 – 20,000 hours in the lifecycle. The major components due will make a high-level comparison meaningless.
Likewise, comparing a remote site in Western Australia with a site in the well-supported Hunter Valley will not provide a valid comparison of component rebuild options and costs or labour rates.
By comparing your site’s performance against hundreds of similar operations, your mining team can set realistic, achievable targets which will increase overall productivity.
If you can measure it, you can improve it. The world’s biggest mining companies know this.
The way in which equipment is maintained is critical to the $/t performance of a site. It’s important to know where you sit on the spectrum of maintenance performance, and what the levers are to drive efficiency over time.
Having access to credible benchmarking information and an expert team who is experienced in efficient maintenance practices will help in achieving this. At Emeco, we work with industry benchmarking leaders and platforms to support our clients in evaluating and improving $/t costs for mine sites. By benchmarking first, we offer valuable, targeted recommendations for improving cost-efficiency and productivity.