Benchmarks of Performance for Truck and Loader Fleets

G. B. Woodrow, Caterpillar of Australia Third Large Open Pit Mining Conference Mackay, August 30 - September 3, 1992.

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Benchmarks of Performance for Truck and Loader Fleets

G B WOODROW1
ABSTRACT
The cost of production from truck and loader fleets is influenced by management development of the culture of the organisation, work practices, systems and procedures of the production and maintenance teams. Establishing if the cost of production is the best that can be achieved then requires the measurement of results against established standards of performance. This paper provides a series of discussion points of the factors that influence the cost of production from men and machines for large scale open pit mining operation and provides some suggested performance standards in the form of Benchmarks. Most of the references have been drawn from established large scale deep pit mines in USA, Canada and Australia which have had to implement and constantly fine tune cost efficiencies in order to survive. The discussion provides: a review of priorities or the relative importance of the various cost elements for a mining system; suggestions of systems and procedures for the operation and maintenance of machines which are considered to yield the best overall results; examples of operations that have developed and implemented management systems and controls that are achieving good results in specific functions; and suggested benchmarks of performance.

Major Work Functions, subjects: then the Machine cost. Major work functions

the Machine System cost and

Most mining operations consist of drilling and blasting the waste and ore, loading the fractured material, hauling the material to a dump or hopper plus the cost of support operations to these production tasks such as maintaining cut and dump area, and maintaining haul roads. Each project should be reviewed on it's own right to establish which part of operation has the highest cost and hence priority for further review. As an example Figure 1 shows a typical cost breakdown for a deep pit mine.

Machine system costs

If it is accepted that the primary contributing factors to the cost of production for a machine system are productivity, utilisation, availability and operation costs, then we can establish the ranking order of these factors as they influence the cost of production. Again such as analyses would need to be established for each operation as the results will be site - specific. Nevertheless, some general observation have been made from various mine studies. The most important factor is usually productivity followed by mechanical availability. As an example Figure 2 shows a typical cost sensitivity review for a deep pit mine.

INTRODUCTION
In order to review and discuss the cost of production from a mining system, it needs to be broken down into individual work functions or cost elements. Each of these work functions can then be analysed as a unit while rernembering that they are interdependent and when added together provide the total cost of the system. As each work function has a different impact or weighting on the total cost of production, !he initial discussion will provide some reference to the establishment of priorities. The paper ,will then follow on to discuss and provide references for individual work functions or cost elements that combine to yield the cost of production under the following headings: production efficiency; potential capability of men and machines, and efficiency of the system, potential versus productivity; mechanical availability; measure of reliability of machines, and quality of maintenance practices; utilis ation; actual

Machine costs
The cost of operating a machine can be broken down into its cost elements such as fuel, tyres, ground engaging tools, repairs, lubrication, preventative maintenance and operators. An analysis of these elements will identify the higher cost item which if improved, will have the most impact. Figure 3 shows an example for a truck working in a deep pit mine. Again each operation would need to be reviewed using its input data as job conditions, haul grades and lengths etc will playa role in changing these priorities. This part of the review identifies the primary or key factors that influence the cost of production. If we use the examples as per the Figures 1, 2 and 3, then the potential priorities for effecting a reduction in the cost of production would be repair and maintenance and productivity of the haulage machines. Other importance factors are cost and effectiveness of support equipment, mechanical availability and fuel costs. Having establish the priorities, it is now a matter of deciding to what extent can change be implemented that will cause a realisation of potential cost reduction. For this part of the analysis we need to know what is the current level of performance, what is a reasonably achievable benchmark and how easy or hard it will be to move to the benchmark.

that part of total scheduled time that the system actually producing; operating costs; cost of operating the machines.

is

PRIORITIES

FOR COST OF PRODUCTION

The next section of this paper discusses some procedures or methods of operation and maintenance practices which are considered to yield the best overall results. PRODUCTION EFFICIENCY

The ranking order of importance for each element of cost must first be established. This then provides the potential priorities for effecting !he greatest reduction in the cost of production. For this analysis the cost of production has been broken down into three

This section has been divided into four subjects being: human resources. work practices; efficiency of an existing fleet; cost benefit of new technology; and job efficiency practices.

1. Caterpillar of Australia Ltd, PMB 4, Tullamarine Vic 3043.

Third Large Open Pit Mining Conference

Mackay,

30 August - 3 September

1992

11g

G B WOODROW

Based on deep open pit, 100,000 tonne/day mIne

Blast

Drjll 7.00/0 8.0%

Haul 40.0%
Load 20.0%

Support

25.0%
FIG I

- Typical

mining system cost distribution.

Based on a deep open pit, 100,000 tonne/day mine

A 5% Improvement in...

Productivity

e.o

MeCMn1c81 8V8D8bDlty

3.4

Opera Un" COlt.

Utltlut/on

12345 yields this percentage reducffon Incosts/tonne

FtG 2 - Typical sensitivity of costs.

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BENCHMARKS OF PERFORMANCEFORTRUCK AND LOADER OPERATIONS

Based on deep open pit, 100,000 tonne/day mine

Lube/OIl/Filters Tyras 11.8% Wear Items

2.8%

28.5%

Fuel/electricity 24.1% 26.6%

FIG 3 - Typical operating cost distril;mtion.

Human resources and work practices.

While this paper concentrates on the management of machines, it is recognised that the attitude and motivation of people is perhaps the real issue in maximising productivity and minimising costs. The paper accepts that quali fied and practically experienced management and supervisory personnel are in place and that human resources policies and procedures provide the environment for high work ethics and personnel satisfaction from achievement of work standard by the work force. The development of the cultUre of an organisation is beyond this discussion. Nevertheless the following represents some of the factors that are generally in place, can be observed and provide a measure of an operation that is achieving good overall results of productivities, quality and cost-effectiveness. Management driven safe working practices. Good housekeeping - clean, tidy work stations with planned methodical work flow. Effective real communication of the company's vision and mission to all levels of the work force. Employees know what the company objectives are, who are the customers, the financial status of the company and so on. Management work to a plan and employees know the plan. Management are pro-active. A competitive spirit exists. Employees consider themselves part of a team. Now let us move on to some of the more practical aspects of machine management. We will review only the mining operation, that being the extraction and haulage of the waste and ore to the dump, input hopper or plant. We will not consider ore processing or other infrastructure costs.

value. The suggested best method of establishing the efficiency of an existing fleet on a particular project is to carry out an on-the-job study/analysis in conjunction with a theoretical analysis of the systems potential performance using computer simulation and modelling. ActUal weekly or monthly production achievements can then be compared to fleet maximum potential production as established by job analysis and simulation. The objective of the on-the-job study is to establish the potential fleet productivity by undertaking a time and motion study and weighing program whereby all inefficiencies are eliminated such as wait time, mismatch, bunching, stoppages. Experienced operators should be used and machines should be allowed to operate at maximum performance. Machine manufacturer and dealer engineers carried out many such study and can assist with the methodology of ajob study. CompUter simulation and modelling can also be an effective tool to establish maximum potential fleet productivity. Given accurate job data combined with field experience, fleet potential productivity can be established with good accuracy using computer simulation software usually available from the manufactUrer or dealer for the machines. Similarly manufactUrers or dealers can provide job stUdies of machines which will provide at least an initial benchmark for that machine. As an example Figure 4 is the summary of a field production study for a wheel loader. Operations that consistently achieve fleet efficiency of 85 per cent and better when measured against maximum potential fleet capability are considered good. New technology The usual question is can a lower cost of production be achieved by the introduction of new technology. This is a complete subject on its own where productivity, costs, availabilities and risks of existing versus new needs to be assessed. Generally however, machine manufacturers are gradually introducing new technologies but rarely does a completely new machine concept

Efficiency of an existing fleet

It is impractical to compare unlike efficiency of an existing fleet on conditiQns, materials, haul distance fleet productivity comparisons from operations to establish the a particular project. Job and grades vary such that job to job are not usually of

Third large Open Pit Mining Confere~ce

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G B WOODROW

Passes (Loading Cat 78S Trucks) Bucket Size

16m' Face Loading

16m' Dozer Assisted

18m' Face Loailing

18m' Dozer Assisted

Method

Loader Cycle Time Loader Time '" Excbange Time

O.5S 2.20

0.54

0.61

0.S9 2.36

road economics is also potentially an area where overall productivity gains can be achieved. For example, the significance of trucks being able to operate at their maximum speed at all times without speed restrictions caused by haul road layout, high rolling resistance, traffic congestion, road surface conditions, sharp non super-elevated curves, poor or inadequate machine braking performance. Job layout, haul road design and operating procedure, manuals and reference materials can usually be obtained from machine manufacturers.

2.16

2.44

MECHANICAL

AVAILABILITY

No. ofTmcks LoadsIHr. (60 min)

27.30

27.80

24.60

25.4

Tmck Payload - Tonn..

131.5

138

138.2

149.S

fronnes Per Bucket Pass Volumc m' Per Bucket Pass

32.9 19.1

34.S 20.1

34.6

37.4

20.2 112%

21.8

Bucket Fill Factor (by Volume) Bucket Fill Factor (by Weight)

119% 104%

126% 109%

121% 118';'

109%

Tmck Body Capacity (m') Volumc m' Loaded In Tmck

78 76.S

78 80.3

78 81

78 87

Loailin8 TonnoslHour
Combined Methods

3,592 3715

3,837

3,400 3614

3,828

-TonnoslHour

Mechanical availability is defined as machines being available for work during scheduled hours. Mechanical down time is any time when the machine is not available for work such as lubrication and services, preventative maintenance, testing and inspections, break down, component replacement, repairs. Comparing mechanical availability between sites is an effective method of establishing a benchmark. However, achieving valid comparisons is often difficult and requires knowledge of other aspects of the project. In comparing mechanical availability achievement between sites, scheduled hours versus total available hours can often invalidate comparisons. Mechanical availability achievement comparison also need to consider the capital that is invested in the maintenance, warehousing and logistical operations. For example, high mechanical availability of an operating fleet can be achieved by high capital investment in standby or spare machine/s or on-site inventories of parts and comp:Jnents or logistical or infrastructure costs. Another potentially hidden cost that can effect comparisons between sites of mechanical availability is technical or sUPp:Jrt division or departments within a mine or at head office that support the operation of machines. This is particularly true when the costs of these personnel are not charged directly to the operation of the machines. Mechanical availability and operating costs are interdependent. Generally, it has been observed that fleets achieving high mechanical availability on a 24-hour seven-days a week operation with low overhead/logistic/infrasrrucLUre costs also achieve commendable operating costs. Mechanical availability depends mainly on three factors: a machine which provides high reliability of its minor components, with regularly predictable life of its major components; a maintenance management system that works to a plan, is sponsored and endorsed by senior management and has controls and measures of performance based on a repair before failure concept; and a developed partnership between the mine, the servicing industry and machine manufacturers. Maintenance management

Advantage In Tonnes

100

Advantage By Percent

3%

FIG 4

- Wheel

loader production study.

evolve. These new products are only successful if they reduce the cost of production. Each case needs to be analysed on its own merits in consideration of the particular job conditions, requirements, short and long term plans etc. To assist with this type of analysis, software programs are available from machine manufacturers and given accurate field experienced data can be a valuable tool. These programs are based on large spreadsheets which can analysis and provide guidance on the decision to either repair. rebuild or replace with a new like machine.

Job efficiency practices

This is perhaps the most imp:Jrtant subject in this section. Knowing what is good practices and what is not is the key to maintaining excellent long term fleet efficiency. Job efficiency guidelines have been developed over a number of years by observation and field study and are usually available from machine manufacturer and dealers. It was suggested earlier in the paper that productivity of the haulage machine is p:Jtentially a LOp priority for management attention. Because of this importance, optimising truck and haul

The following points have been observed as inherent in most good maintenance management systems. Routine lubrication and servicing is undertaken at recommended intervals or modified intervals to match local conditions with approval of the manufacturer. Deviations to standards are monitored for their impact. Between 80 per cent and 90 per cent of all repair work is scheduled and planned as opposed to emergency or unscheduled work. Active and complete machine evaluation routines are in place (such as system checks and inspections, oil sampling, wear metal analysis and trending, operator comments). These routines are used LO take remedial actions and forecast scheduled maintenance, repairs and rebuilds.

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BENCHMARKS

OF PERFORMANCE

FOR TRUCK AND LOADER OPERATIONS

A machine information record system is in place which captures sufficient detail to track each component of a machine, and provides data on why it was repaired, what was the cause and what actions were taken. A management control system exists from which accurate forecasts of activities, personnel requirements, component or parts requirements, and cash flows can be established with ability to make comparison of performance. The following are some suggestions on how to assess a maintenance management system: As outlined above, there is a plan, with targets, controls and measures. Work orders are labelled 'scheduled' of 'non-scheduled'. Variances from a considered target ratio are reviewed. Machine history files are reviewed at fixed periods to identify required improvements. Record systems show when the servicing occurred versus the target date. Records systems are amended/altered to keep up with changing technology of machines, conditions of operation etc. Record system provide meaningful repair indicators that can be confidently used to predict problem areas. The system also produces the detail required to research a problem when it is highlighted. It was suggested earlier that a good maintenance management system incorporates a developed parmership with the servicing industry and machine manufacturers. It is observed that for a good system to work effectively there must be common goals between the parmers and a free open sharing of information. Most good maintenance management systems use a central scheduling system, which obtains informaiion from and provides information to the activities of maintenance controlled by the mine, the servicing industry and the machine manufacturers such as: preventative maintenance and services, component remove and install. component overhaul, condition monitoring system, problem management, parts inventory management, and cost record system. The paper by Mills (1991) addresses all of these maintenance activities, showing their inter-relationship and importance of information flow both within and without the mine. Mechanical availability targets

Some examples of mechanical availability being achieved for large fleets of trUck operating in high load factor applications such as deep pit mines is provided in Figure 5. Mostly these examples are 24-hour, seven-day a week non stop operations (except for two to four days per year). In these examples mechanical availability is based on down time being all times when the machines are not available to and for production.

Copper

Mine,

Truck Fleet 1st. year or operation

94%

Papua Now Guinea

Truck Fleet AVOl3l!e for 25 unim to 28,500

hows

90%

Copper Mine British Columbia, Canada

TmcI< Fleet AVOl3l!e for

88%

25 unim to 21,000 bows

Copper Mine Now Mexico, USA

Truck Fleet AVOl3l!e ror 26 unim to 21 ,000 hOUIB 1st year 2nd year

90.4% 88% 86.2%

3rd year

Copper Mine, Arizona, USA

Truck FI..t Average for 14 unim to 25,500 hows

92%

Copper Mine, UtIh, USA

Truck Fleet Average

for

94%

24 unim to 27,300 hows

Copper Mine, Chile

Truck FI..t Avera8e fot 17 unim to 23, 000 hours 1st year 2nd year 3rd year 4th year

93% 95% 92% 90% 88%

Oil Shal. Min., Canada

Truck Fleet Average

for 15 unim to 24,000

hoUB

88%

Gold Mine,
Nevada, USA

Truck FI..t Average for 17 unim to 37,600 hoUB

90%

Gold Mine, Nevada, USA

Truck Fleet Average

for

88%

26 unim to 35,000 hour.!

As mentioned earlier, mechanical availability achievements needs to be reviewed in conjunction with other factors such as operating cost and scheduled versus total available time. The system or procedures that are used are possibly the most important aspect of achieving high mechanical availabilities. The following are some mining and constrUction operations who are recognised as having good maintenance system and procedures and are generally willing to share information. PNG BHP Ok Tedi mine Highland Valley Mine Cypress Serrita Mine Phelps Dodge China Western Excavation RTZ Bingham Mine Peter Kiewit British Columbia Canada Tuscon, Arizona Silver City, New Mexico Cornwall, UK Salt Lake, Utah USA contractor USA contractor

FIG 5

- Mechanical

availability for large high hour truck fleets based on 24-hr, seven-day a week, mining operations, as at December 1991.

UTILISATION
Production utilisation is that time for which the mining system is actually producing and is usually compared to the total available or scheduled hours in a year. Production utilisation is total available time minus production delays and minus mechanical downtime. It is in effect a measure of how hard the invested capital in the mining system is being used for productive work. High utilisation is a ultimate measure of many of the factors previously discussed particularly for mines that operate on a 24-hour seven-day a week non-stop basis. High utilisation can also be looked on as a overall measure of management capabilities, human resources practices, machine reliability, maintenance management systems and the parmership/team arrangements with supporting service industries.

H B Zachary

Third Large Open Pit Mining Conference

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1992

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G B WOODROW

Example of mining operations which are achieving high utilisation from truck fleets is shown in Figure 6. What is excellent utilisation will vary from site to site, but based on observations some operations are approaching 7500 hours of real producing machine hours per year from mobile mining fleets.

Delivery Months of Date Service of Fleets

Total HaUlS

Annual Hours

Gold Mine

Nevada, USA British Columbia, Canada

Scp86

61

37,600

7,397

Coal Mine

June 86

64

observation that this significant cost is often overlooked.For example: Is fuel efficiency taken into consideration in the evaluation of mining systems or machines? Is fuel consumption or energy required taken into consideration in mine designs, haul road layouts, grades, rolling resistance? Is haul road construction and maintenance considered in relation to fuel usage? AIe machine operating practices implemented to minimise fuel consumption (amount of idle time, unproductive travel for machines)? Is fuel purchased on price per gallon or to a specification that will yield lowest cost of production. Same applies to oils as relates to maximising component life-time between overhauls etc? Diesel engine injector life and engine component life to overhaul is directly related to fuel consumed and quality. The maintenance and repair cost for most machines are forecastible and can be budgeted either based on historical records or for a new type of machine based on a combination of site specific historical records and information provided by the machine dealer and manufactUrer. Most machine dealers can provide budget operating costs or guaranteed firm price service contracts over fixed periods. These service contracts are usually based on machine component before failure rebuilds using volume based tooling and factory rebuilding systems, Manufacturer-recommended reuseability guides and standard times. Similarly for removal and installation of components, manufactUrer or dealer volume based experienced standard times and used.These service contracts can provide a benchmark or budget data. There is a definite trend in the mining industry worldwide to reduce operating costs by using a partnership between the mine and a local servicing dealers. Generally it relates to the recognition of 'who is the lowest cost source or who is more efficient commensurate with capital and manpower requirements'. It is also noted that many mines incur high on-site manpower costs usually relating to the history of industrial agreements and the past need for self sufficiency. With the gradual introduction of modern technologies in volume manufactured machines coupled with modular component replacement and the developed cost effectiveness of volume based repair facilities, these partnerships and off site service contract agreements have resulted in reduced total maintenance costs, re-alignment of skills for on-site labour and a reduction in on-site labour. For mines using service contracts, maintenance man hours pcr operating hour of 0.25 has been recorded in remote or high infrastructure cost locations. These product support agreements generally result in operating cost efficiency by using the developed skills of the partners. The miner does what he can do best and the machine dealer does what he can do best. The reasons for the trend relate to budgeting and sharing- the risk, the establishment of known costs up front. reductions in mining company's investment in people, training, tools, inventories, and other associated non productive infrastructure. These partnerships are also becoming popular as a way of defining or fixing total operating costs over a long period and sharing the responsibilities, rewards and risks associated with mining machines.

35,000

6,563

Gold Mine

Nevada, USA

Jun87

52

32,000

7,385

Copper Mine

Papua New Guinea

Scp88

39

28,500

7,230

Copper Mine

Utah,USA

Jan 88

45

27,300

7,280

Copper Mine

Arizona, USA

Mu88

43

25,500

7,116

Copper Mine

New Mexico, USA

Nay 87

847

2,5000

6,383

Iron Ore Mine

Quebec, Canada

Jan 88

45

24,700

6,587

Copper Mine

New Mexico, USA British Columbia,

Nay 88

35

21,200

7,269

Copper Mine Canada

Jul88

..

39

21,000

6,462

Copper Mine

Arizona, USA

Jul89

27

16,000

7,111

Unused for 12 months during II1IIlsfer between

mines (no adjustment

made).

..

Includes

4 months strike in 1989 (no adjustment

made).

FIG 6 - Truck fleets achieving high utilisation, as at December 1991.

OPERATING COSTS
The key factors or cost elements effecting machine operating costs are fuel, operator, and maintenance/repair as referred to in Figure 3. It is not considered within the scope of this paper to discuss ownership costs. However, by this comment it is not suggested that ownership costs are not part of the equation nor are they not important. For this review, we have addressed the ongoing task of minimising and controlling operating cost., after the machine!fleet goes into operation. Mostly the control and minimisation of operating costs is covered in the previous section. If good maintenance management systems are in place then the result will also be low operating costs. Fuel consumed is a major cost. It can vary from 25 per cent to 33 per cent of the total cost of a machine life cycle. This suggests good fuel management should also be in place. It is an

CONCLUSION
The work function or cost elements that combine in a truck and loader fleet mining system to yield the total cost of production has been reviewed. Some suggestions have been provided of system and procedures that should prav ide high productivity commensurate with low operating costs. Based on observations and recorded data, some benchmarks of performance for each

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1992

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BENCHMARKS

OF PERFORMANCE

FOR TRUCK AND LOADER OPERATIONS

work function has been suggested. Follows a summary of these suggestions.

Maintenance efficiency Operating costs Utilisation

Eighty-five per cent of all workshop repair work is planned and scheduled.

Benchmarks Production efficiency Mechanical availability Maintenance manpower

of performance
Actual fleet production exceed 85 per cent of maximum fleet production potential. Fleet Average exceeds machine economic life. Maintenance man hours hour less than 0.25. 90 per cent to per operating

Achieve or reduce manufacturers/dealers standard times and component cost. Fleet operating hours are 90 per cent of total available or scheduled hours.

REFERENCES:
Mills, D, 1991. Managing
Maintenance of Heavy Mobile (BHP Newman Maintenance Management Conference). Equipment

Third Large Open Pit Mining Conference

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1992

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