John Leech discusses the importance of taking a whole of supply chain approach.
Mine to ship export chains are often long and complex and can behave with seemingly greater complexity than the sum of their parts. In many cases, the performance and behaviour of one element in the chain can be impacted by the characteristics of another element in the chain that might be physically distant and not intuitively connected to the first element.
In order to optimise the transportation chain it is necessary to first gain a clear understanding of the interactions between the various elements, the sensitivities to changes in parameters and how well the day to day operating methodology is matched to extracting the best performance from the system.
This article provides an introduction to some of the typical interactions that exist between the components of a mine to ship bulk export chain. The discussion focuses on the characteristics of two key operating modes along with the relative benefits and the situations where these different modes are best applied.
Figure 1 shows a typical mineral export chain in schematic form.
A bulk minerals export chain typically involves a number of transportation processes and product sizing, sorting and beneficiation processes. These are necessarily interconnected via buffer storage facilities located at the mine and port. These buffers are essential for absorbing unavoidable differences in product movements between the relatively continuous mine production processes, and the less continuous transportation processes that involve movement of large discrete parcels of material at regular or potentially irregular intervals. Often there is also a call for buffer facilities to provide blending capabilities for quality control.
Key decisions impacting performance need to be made with respect to:
The pit to port operating mode as described further below.
Overall supply chain performance will obviously be limited by the performance of the lowest capacity element in the chain, and reference is therefore often made to a particular bottleneck as the responsible culprit for preventing the realisation of a larger capacity. However, the identified bottleneck is rarely without accomplices, and without an understanding of these other influences there is a risk of poor investment of funds in pursuit of performance gains.
The key is to recognise that the characteristics and performances of a number of other elements in the chain and the overarching operating philosophy will usually strongly influence the performance of any particular element in the supply chain. Therefore, presentation of any findings regarding identification of a particular bottleneck should include a detailed discussion regarding the influences of other parameters, sensitivities to changes in these parameters and any other nearby bottlenecks that threaten to step into the breach with relatively minor changes in circumstances.
Understanding the full picture usually allows identification of multiple solutions to removing the bottleneck. These may involve upgrade of physical plant at the bottleneck itself. However, alternative solutions will often exist that will have the same effect of removing the bottleneck but at lower cost. These might involve making changes to other parameters or improving the performances of other elements in the system.
Each potential solution needs to be examined for relative cost effectiveness, after which it will be possible to make a well informed decision about the action to take.
The choices of potential operating modes or philosophies for managing the movement of ore from mine to vessel are almost infinite. However, most operating modes can be broadly categorised as one of the following two modes or a combination thereof:
The chief differentiator in these modes is the scheduling manner of the train operations in the mine to port railway, but there are important differences with the impacts these modes have on demands for infrastructure at both the mine and port.
For this mode, the port stockyard acts as the main buffer between the relatively constant mining process and the often irregular shipping operations. Subject to the availability of sufficient storage space at the port, transportation of ore to the port takes place in a near regular fashion. Products cannot be stacked in cargo or ship related stockpiles since the target vessel is often unknown at the time of railing, so brand related piles are formed that tend to occupy a relatively constant position in the stockyard as shown in the schematic representation at Figure 2 (right).
The main advantage of this mode is that it enables the greatest scope for streamlining of rail operations by maximising the ability to operate the railway according to a near regular schedule. However, in practice, the actual achievement of regular railing will depend upon specific circumstances and especially whether there is sufficient available stockyard storage at the port.
The approach tends to lead to higher port storage ratios although the actual storage volume required to achieve a given degree of regular railing is in reality determined by:
Minimising the number of products and arranging for minimum variation in vessel size and arrival frequency can reduce the port stockyard volume requirement. In practice, it is rare to achieve rail scheduling according to an entirely regular schedule. It is usual to make some variations to avoid exceeding port stockyard volume limitations.
The regular railing/dedicated storage approach also tends to minimise mine storage requirements and reduces pressure on achieving high rail loading rates at the mine.
Significantly, changes in throughput capacity do not greatly impact the port storage requirement and therefore the port storage ratio (the ratio of storage volume to annual throughput) tends to reduce as throughput capacity per product increases.
This mode of operation is typical when product handling numbers are relatively low, and/or for certain products that represent a very high proportion of overall throughput. It is therefore the usual choice of operating mode for supply chains dedicated to a single user or low numbers of users and often the chosen mode for a start-up supply chain.
The problem with a regular rail/dedicated storage approach is that it becomes increasingly difficult to deliver efficient port operations as a supply chain expands to gather additional users, numbers of products and/or a requirement to load multiple vessels simultaneously at the port.
These complexities tend to stifle the supply chain performance to the extent that the benefits usually afforded by this mode of operation towards streamlining of rail operations become irrelevant. Mitigation strategies typically involve significant increases in the port storage requirements and it is often the lack of available port stockyard space that ultimately makes continued operation of this mode infeasible as a supply chain expands to gather additional users, numbers of products and/or operating berths.
The cargo assembly mode involves railing ore to the port only when required to meet the scheduled arrival of the target vessel. Port stockpiles correlate to specific vessel cargos as shown in the schematic representation in Figure 4. Therefore, at any point, there will only be priority shipping products in the stockyard.
Figure 5: The Dalrymple Bay coal terminal and Goonyella Rail network in Queensland operates according to a cargo assembly mode.
The primary advantage of a cargo assembly approach is that it provides significant benefits in allowing streamlining of port operations, especially in large multi-user ports where there are high numbers of products and multiple operating berths. Port stockyard storage ratios also tend to be smaller than for dedicated storage systems and, importantly, storage requirements become independent of the number of products handled.
The streamlining of port operations stems from the ability to arrange the placement of cargos in the port stockyard to avoid utilisation conflicts in reclaim operations. In particular, it is possible to stockpile the sets of cargos destined for a particular queue of vessels in a common zone of the stockyard allocated to outloading via a particular berth or shiploader. It follows that, regardless of the number of products and operating berths, reclaimer machines serving one operating berth can proceed (for the most part) without risk of a conflicting demand to simultaneously load another vessel on another berth.
The potential downside of adopting a cargo assembly approach is it demands a greater level of complexity in the planning of rail operations, since it requires constant rearranging of the rail schedule to focus the resources of the railway on bringing parcels to the port in order of priority to match the order of pending vessel arrival.
Mine stockyard volumes also tend to increase as train loading operations become less regular, with periods of inactivity interspersed with periods where multiple trains are required to be loaded in relatively close succession. A further potential issue is the need to put in place a process of managing and storing cargo remnants, left over in the port stockyard after ship loading. However, it is possible to adopt a number of strategies with minimal impact on efficient port operation.
The port storage volume requirement is typically a function of, the average parcel size, average cargo residence time in the port and throughput capacity.
Storage volume requirements can be as low as 2 per cent and, importantly, are independent of product numbers. However, it is important to keep in mind the potential impacts upon rail performance of very low storage ratios.
Considering all the advantages and potential disadvantages, a cargo assembly approach will often deliver the most efficient overall supply chain operation, especially for large multi-user export chains that involve ports with multiple operating berths and constrained port space.
The key to avoiding excessive strain on railway operations in a cargo assembly supply chain is via provision of a sufficiently large stockyard volume at the port. A larger port stockyard allows assembly of individual cargos over a longer duration and the railway to draw capacity from a larger number of destination mines at any point. This takes pressure off railway branch lines, load-out loops and other mine load-out infrastructure.
It is perfectly feasible to operate a supply chain using a combination of the approaches described above. In general, there is an increased desire to adopt a regular railing, dedicated storage approach for the subset of products that contribute to a greater proportion of throughput or travel from more distant mines.
To further demonstrate some typical interactions in a cargo assembly system and emphasis the point there is usually more than one solution available to increase ore chain capacity, the balance of this discussion explains potential alternative means of increasing capacity for a hypothetical (and simplified) ore export chain.
Figure 4 shows a hypothetical export chain with rail network linking between a number of mines and a port that has stockyard space for only five cargos. Operation of the export chain is in a cargo assembly mode.
At this time, two of the potential cargo spaces in the port stockyard are occupied by a cargo loading to a vessel and an additional cargo completed in readiness for loading to the next vessel. The remaining stockyard space is available for assembly of the next three cargos that happen to be comprised of products numbers 1, 5 and 10. The sources of these products are the mines as indicated in the diagram.
The boxed numbers shown in the diagram adjacent to the branch lines indicate daily train handling limitations applicable to the relevant branch lines and mine load-outs. The limitation may be due to track constraints and train transit times or mine load-out capacity constraints. This example assumes the trunk rail line and any rolling stock limitations place no significant additional constraint on potential railing capacities.
Considering space in the port stockyard is limited to the next three priority shipping products, scheduling of trains can be to collect product only from the relevant product source mines. Considering the branch line/mine load-out limitations applicable to these mines, the supply chain capacity cannot exceed five trains per day at this point. At this stage, we might declare the bottleneck is in the rail network and more specifically in the branch line and mine load-out capacities.
Consider then an upgrade to the mine load-outs and/or branch lines such that the new train/day constraints are as shown in Figure 5.
By increasing mine load-out capacities, the limiting capacity of the rail network (setting any other constraints aside) increases to eight trains per day.
However, the cost of upgrading these multiple branch lines might be considerable and instead a better approach might be to increase port stockyard volume capacity as shown in Figure 6.
The larger port stockyard allows the railway to now draw capacity from five different mines thus increasing the limiting capacity of the rail network to the same level of eight trains per day. The key point is that this might be been achieved without making any modifications to the rail network itself.
The example described above is simplistic and assumes there are no other limiting influences in the rail network with respect to above or below rail services or in the port that would also influence the result as may well occur in a real export chain. However, it serves to demonstrate the typical sort of interaction likely to take place and the need to gain a full understanding of the interactions between the various elements of the supply chain before determining the best course of action to increase ore chain capacity.
One area often mistreated in system design work is at the rail/port interface and in making provision for the avoidance of train delays at the port due to imperfect train arrival order.
Most port stockyards will require a particular train load to be stacked into the stockyard via a particular yard machine or stacking path in order to access the required location in the stockyard. For large ports with multiple dump stations, trains must arrive at the port with some controlled diversity regarding the target stacking paths in order to avoid delays due to competition for the same yard machine or stacking path.
A typical rail solution might involve provision of rail yards close to the port to allow reordering of trains. However, this will usually come at the cost of additional train sets to compensate for time lost due to train queuing in this facility. It is advisable to examine alternative port solutions. These might involve the provision of additional stacking plant, or perhaps the use of stockpile placement strategies that simply provide a greater choice of available stacking paths for a given train load. Such port solutions might provide a more economical means of boosting the supply chain capacity in comparison to the equivalent rail solution.
A probability based simulation model is an extremely useful analysis tool for testing supply chain performance and for informing an understanding of the key drivers and limiters in a transportation chain. However, it is important not to rush to develop such a model too early in the life of any new project, or in the investigation of capacity limitations within existing systems.
Development of realistic probability based simulation models can be time consuming. Deterministic models utilising other mathematical techniques in the hands of experienced engineers or modellers can often be more useful in the early stages to allow rapid development of the initial schematic designs or to identify suspected problems. The use of the detailed probability based simulation model to test and fine tune the original conclusions can follow.
Models that encompass the complete export chain from mine to rail to ship are generally preferred but are not essential. Using separate port and rail models can be successful if there is careful handling of boundary conditions, and may even be preferable if this assists the quality of the modelling of one or other of the port or rail elements in the available time.
The key to minimising the cost of taking a mineral to market is the selection of an appropriate overarching operating mode and the development of matching infrastructure to deliver a fully integrated transportation chain where each element is designed and operated to work in harmony with every other part of the system.
In order to facilitate this, it is vitally important to structure commercial arrangements between export chain users and service providers (e.g. port and rail) to facilitate a cooperative approach and maintain a best for supply chain focus throughout the life of the operation.
John Leech is Aurecon’s bulk materials handling leader and has a long history in developing innovative solutions within mine to port transportation chains.