Dr. Marcelo Godoy, Newmont’s Group Executive for Resource Modeling, recently joined industry experts at Society for Mining, Metallurgy & Exploration’s (SME) 4th Annual Current Trends in Mining Finance Conference to share his expertise on Newmont’s innovative use of technology to improve accuracy in estimating gold resources underground.
In a presentation titled, “A New Paradigm to Manage Technical Risks in Mining,” Dr. Godoy discussed how a new approach to resource risk management can support more reliable business plans and investment decisions, thereby enhancing Newmont’s ability to succeed in all commodity cycles.
”Resource models are three-dimensional representations of mineral deposits that are used to support exploration decisions, evaluate projects and develop business plans. The processes of data acquisition and modeling are subject to several sources of error that inevitably generate uncertainty in resource estimates,” said Dr. Godoy.
It is commonly understood across the mining industry that resource estimation uncertainty is a major contributor to projects not meeting expectations. International Project Analysis, a group that benchmarks key elements of capital effectiveness and produces metrics from the evaluation of more than 1,100 mineral projects worldwide, maintains that too few mining projects begin execution with an adequate understanding of orebodies.
“Newmont has developed a systematic process of identifying, analyzing and addressing resource risk which is now embedded into our business planning cycle,” said Dr. Godoy. “The process allows us to narrow the gap between our estimated and actual tonnages, grades, metallurgical recoveries, costs and productivity. Moreover, our ability of bringing projects online, on time, on budget and meeting project expectations provides a major competitive advantage for Newmont.”
Effectively identifying and managing risk is critical to delivering our strategy to improve the underlying business, build a stronger asset portfolio and differentiate ourselves from competitors.