At a Glance
A prominent metallic mineral exploration and mining company, operating one of the country’s largest copper mines, faced the challenge of optimising its operations in conjunction with the expansion of its beneficiation plant. The client sought to reduce operational costs across its mining and milling processes, improve productivity, and enhance maintenance and procurement practices. Renoir was engaged to address these challenges, identifying an estimated minimum opportunity of 5.16 Million USD in annualised savings.
Key Results
- 21% reduction of Mine Cost per Ton Moved.
- 21% improvement in Dump Truck Productivity & 11% improvement in Excavator Productivity.
- 134% improvement in Crusher Planned Maintenance & 39% improvement in Mill Planned Maintenance.
Background
The client is a company primarily engaged in metallic mineral exploration and mining. It operates one of the country’s largest copper mines, making it a principal producer and exporter of copper concentrates in the Philippines. Beyond copper, the client is also actively pursuing the development and commercial distribution of marketable by-products from its copper concentrate processing, such as molybdenum, magnetite, and pyrite, in line with the expansion of its beneficiation plant. The specific number of employees or detailed historical information about the client’s founding is not provided in the sources.
The Challenge
The primary reason for undertaking the project was the client’s objective to optimise its mining operations and align with the expansion of its beneficiation plant. Renoir was appointed to specifically assist in reducing the costs of the client’s operations. The scope of the implementation effort covered all areas with an estimated minimum opportunity of 5.16 Million USD in savings on an annualised basis.
The key challenges the client was facing, which the project aimed to solve, included:
- The need to improve planning and productivity in both mining and milling operations.
- The requirement to improve maintenance planning, productivity, and reliability, alongside reviewing current spare and procurement practices.
- The goal of optimising the existing organisation structure.
What We Did to Enhance Mining Operations
Renoir initiated the project using its proprietary Focus Process® methodology, which is based on extensive experience from numerous successful assignments. To ensure maximum impact and client buy-in, a ‘Management Action Team’ (MAT) was established for each of the three core workstreams: Mine & Mill Operations, Maintenance & Procurement, and Organisational Design. Each MAT was led by a senior client executive, including the Chief Operations Officer (for Mine and Mill Operations), the Mill Maintenance Division Head (for Maintenance and Procurement), and the Assistant Vice President for Human Resources and Administration (for Organisational Design), fostering direct engagement with relevant departments and stakeholders.
The approach involved a thorough study of existing processes, followed by the customisation and incorporation of best practices. This collaborative learning experience aimed to promote commitment and ownership among the client’s team members. Renoir, in conjunction with each MAT, implemented new Management Control Systems (MCS), providing comprehensive training, coaching, and support to staff. These MCS elements provided clear work processes, accountabilities, and responsibilities, facilitating timely operational performance reviews by the management team and enhancing operational management, control, and communication within teams. Additionally, Renoir developed an Organisational Design Manual to assess and validate the skills and knowledge of each team member, and designed a new organisational structure for the departments involved in the workstreams.
Specific initiatives included:
- Mine & Mill Operations: Designing and implementing a Line Balancing Forecast Model for improved production planning, revising working processes to increase productivity, establishing operational KPIs with visual performance dashboards, defining Roles & Responsibilities in RACI charts, and designing a Behavioural Audit mechanism.
- Maintenance & Procurement: Redesigning and standardising maintenance processes, introducing standardised tools such as the Risk Assessment Matrix and root cause analysis, implementing supply chain tools for supplier management and PR/PO Service Level Agreements, and establishing operational KPIs for monitoring business performance. A dedicated MCS was also implemented for Maintenance and Supply Chain.
- Organisational Design: All project-scoped departments established KPIs for their Performance Appraisal Management System (PAMS), and self-assessments with validations were completed for front-line operatives.
The Results
The implementation phase led to an overall significant improvement against established Key Performance Indicators (KPIs). The client’s President & CEO acknowledged Renoir’s role in helping the client attain improved operational performance and ensuring sustainability of these achievements.
Specifically, the project delivered considerable benefits:
- Mine and Mill Operations successfully achieved their key success measures and the implemented MCS helped increase truck and excavator productivity.
- Mine Maintenance, Crusher Maintenance, Mill Maintenance, and Supply Chain all experienced improved operational efficiency. Supply chain efficiency also saw significant gains with a 118% improvement in % PR to PO (Purchase Requisition to Purchase Order) conversion within 7 Days, a 304% improvement in %GR (Goods Receipts) Compliance, and a 24% improvement in %GI (Goods Issues) Compliance.
- The Organisational Design workstream successfully developed and implemented an Organisational Design Manual. This enabled all in-scope departments to establish KPIs for their Performance Appraisal Management System (PAMS), with self-assessments and validations completed for various front-line operatives.
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