Blasting Economics ©Dr. B. C. Paul 2009 Note – The example contained in these slides was prepared by the author for use in the courses he instructs. It represents ideas and concepts believed by the author to be commonly understood by those well studied in the subject. Cost figures were taken from a variety of published and unpublished discussion sources, though contributions from Western Mine Cost Service and the U.S. Bureau of Mines are specifically recognized.

We Will Utilize A Standard Blast Design Cost Calculation Spreadsheet The Spreadsheet will consider –The Ownership Cost of Your Drills –The Operating Cost of Your Drills –The Labor Cost for Drill Operations –The Ownership Cost of Explosives Trucks –The Explosives Supplies Cost –The Explosives Labor Cost –Management and Engineering Support Cost –Penalty Costs Wear and Tear Secondary Breakage Pit evacuations for Blasting

Why A Spreadsheet? Cost Estimating Calculations are generally simple math Just a tedious matter of estimating each thing and adding up totals –Spreadsheet avoids calculation errors and differences in assumptions

The Basic Input Pick your drill type Use the table to enter your drill penetration Rate.

Get Other Parameters from your Have a Blast Spreadsheet

Plug Into Sheet

First Task Is To Get Ownership Cost of Drill Approach –Figure out how much time it will take to drill the holes each year –Figure out how many drills you need and how many hours they will work –Figure out how long the drill will last –Now you have Capital Cost for drills and the life of the drills you can get an annual cost to own the drills

Our Spreadsheet Here is the bottom line cost per year $294,606

Deciding How Much Drill Time Number of feet drilled –Required tonnage * specific drilling (specific drilling is ft of drilling per ton) Number of Holes Drilled –Number feet drilled / length of a hole You know how long it takes to set up to drill a hole You know how long it takes to drill a foot of hole Add the two and you have the drilling time needed (We had the time for each type of drill to set up Over 1 hole) (We know how many feet of hole the drill can go An hour when it is drilling)

Crunching Toward an Answer Drill crews don’t work 60 minutes an hour Drills are not in working order 100% of the time Drills are not assigned to work 100% of the time they are available Use these factors to find out how many hours you will have to plan for a drill to get what you really need Compare that to hours one drill can be available Now you know how many drills you need

And Getting There Divide up the hours between the drills needed Divide the hours of drill life by the hours worked per year to get the drill life A/P converts the capital cost of the drills into equal payments (with interest) over the life of the drill –We how have the drill Capital Cost broken down on an annual basis.

Finding Out How Many Hours and Drills With 8 months, 5 days a week and 10 hour shifts I have 1714 hours Max available on one drill.

Other Ownership Costs Taxes and Insurance –These are commonly approximated as a percentage of the value of the equipment –Most mining equipment tends to be 4 to 7% of value depending on what it is. –Problem is that the value varies with time as the asset grows old and wears out –Idea is to get the average value at the start of each tax or insurance year Industry term is average annual investment.

Spreadsheet Gets Taxes as a Function of Average Annual Investment Now we have our first cost – What is the Annual Ownership Cost of the drills we must have to meet production? $294,606 per year

Drill Operations Cost Energy Cost = Fuel Units/hr * #hours worked * Cost/Energy Unit

More Drill Operating Costs Repair Cost = Cost/hr * # Hours Worked

The Stabilizer and Recorder Costs Misc Parts Cost = Stabilizer+Recorder Cost/hr * # Hours

Bit and Steel Costs Bit and Steel Cost = Cost Per Foot Drilled * # of feet of drilling

Total Up the Non-Labor Direct Drill Operating Costs

Getting Drill Labor Cost Drill crew is assumed to consist of a head driller and helper. Drill Labor Cost = (Head Driller/hr + Helper/hr) * # hours for crew

What Is Burden? In this case its not the amount of rock to blast Employer pays –Wage for hours worked –Also pay Social Security Match Workmans Comp Insurance Unemployment Insurance Health Insurance Vacation and Sick Leave Other Benefits Company Pays –Costs for employees that are not paid as a wage/hr are called Burden Commonly estimated as a % of work payroll

Getting The Capital Cost of Explosives Equipment If you are bulk loading explosives you need an Explosives Truck If using bagged explosive gels a heavy pick-up can be used If doing electric blasting need sequential blasting machine. Calculation method is the same as was used in getting capital cost Of drills.

Next You Choose Your Initiation System Electric – current passing through wire electric circuits ignite timing elements in caps that set off boosters that set off charge –Quite –Circuits can be tested from the initiation point –Delay Elements are down the hole in caps or from delayed pulses sent out to circuits from blasting machine. –Need to practice electrical design to make sure circuits are balanced –Risk – large wire loops convert Electro-Magnetic waves into electricity which could set off some of the caps

Detonating Cord Cord is filled with high explosive Shot is physically connected with cord and initiation spreads by blast propagation through the cord. Just tying the cord around a booster can set-off the booster as the cord explodes – no caps needed Delays are usually fuse sections put into the lines on the surface

Det Cord Dark Sides It is very noisy – if you burry it you could break a connection Only way to check the system is to check every connection Usually have to top prime because det cord will burn powder around it as detonation wave goes through powder Pretty much need a direct lighting strike hit to set it off accidentally.

Non-El Uses caps in booster like electric Network is connected by hollow cord with explosive on the edges –Result is a lot less noise –Won’t burn surrounding powder so you can bottom prime –Also can use air pressure to check connections from one point Put delay fused in lines on the surface or down the holes. Lines don’t generate stray electric currents from EM pulses

Choosing on the Spreadsheet Enter 1 for What Ever System you use. Indicate the Number of Booster per hole Indicate the Number of Initiation points Identify the number of surface or down hole delays used in your Pattern (needed for non-el and det cord)

Spread Sheet Calculations Boosters = #boosters/hole*# of holes*cost/booster Caps = #initiation points/hole*#holes*cost/cap (det cord systems have no caps) Delays = #of delays/pattern*#of patterns*cost/delay

Final Explosives Cost Calculations There is also a cost for connecting Wires and cords. Spreadsheet uses a % of total Cost approach to estimate Takes subtotal for powder, Caps, boosters, delays and adds A percentage for cord. It totals up everything to get the annual explosives cost.

We Need Workers to Load the Explosives and Hook-Up the Shot We know the number of holes The value of holes loaded per shift is from a number of published articles A crew is expected to consist of a Blast Supervisor and two helpers # Shifts needed = # of holes / holes per shift Cost per Shift = (Sum of Labors cost/hour)*hours per shift Labor Cost Per Year is = # Shifts needed * Cost per Shift

Engineering and Management Costs Are Estimated as a Percentage of Other Labor Costs

Spreadsheet Charges Penalties for Impact on Other Operations Secondary breakage on top of grizzly screen costs money. Take a cost/ton for Secondary breakage * tons needing breakage. (The percentage of your tonnage Needing secondary breakage comes from Havablast Spreadsheet). Note – Even if 2ndary breakage is within acceptable limits it still does not happen For free.

Excess Wear Penalty When rocks are too big it puts extra wear on trucks, bed-liners, suspensions, loader Teeth and hydraulics and other things. Spreadsheet uses D50 from the Havablast Spreadsheet and a cost per inch for excess size to estimate. (Note that you could Change values to tune a sheet like this to a specific operation).

Cost of Suspended Operations When blasting is to be done, equipment is pulled back and workers not needed for The blasting work are evacuated from the pit. Equipment not in service still has An ownership cost and workers still are paid. Even if the blast may be done in less Than 10 minutes people slowing down before the blast and then getting “in the groove” After takes time. (Note – this spreadsheet does not charge a lost production penalty)

Spreadsheet Totals the Annual Costs and Then Divides By the Annual Tons Result is the Cost Per Ton for Rock Blasting (The name of the game for your assignment #5 is to have the lowest cost And a design that still works)

Assignment #5 is now issued