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.
- ----..
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.
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 actual
productivity;
mechanical availability;
measure of reliability of machines, and
quality of maintenance practices;
utilis ation;
that part of total scheduled time that the system is
actually producing;
operating costs;
cost of operating the machines.
PRIORITIES FOR COST OF PRODUCTION
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
1. Caterpillar of Australia Ltd, PMB 4, Tullamarine Vic 3043.
Third Large Open Pit Mining Conference
subjects: Major Work Functions, the Machine System cost and
then the Machine cost.
Major work functions
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.
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.
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
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.
Mackay, 30 August - 3 September 1992
11g
~
G B WOODROW
Based on deep open pit, 100,000 tonne/day mIne
Drjll 7.00/0
Blast 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...
Utltlut/on
e.o
Productivity
MeCMn1c81
8V8D8bDlty
3.4
Opera Un"
COlt.
0 12345
yields this percentage reducffon Incosts/tonne
6
FtG 2 - Typical sensitivity of costs.
120 Mackay. 30 August. 3 September 1992 Third Large Open Pit Mining Conference
BENCHMARKS OFPERFORMANCEFORTRUCK AND LOADEROPERATIONS
Based on deep open pit, 100,000 tonne/day mine
Lube/OIl/Filters 2.8%
Tyras 11.8%
Wear Items
Fuel/electricity 24.1%
28.5%
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.
Efficiency of an existing fleet
It is impractical to compare unlike operations to establish the
efficiency of an existing fleet on a particular project. Job
conditiQns, materials, haul distance and grades vary such that
fleet productivity comparisons from job to job are not usually of
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
Third large Open Pit Mining Confere~ce Mackay, 30 August. 3 September 1992
121
G B WOODROW
FIG4 -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 LOppriority for management
attention. Because of this importance, optimising truck and haul
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.
MECHANICAL AVAILABILITY
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
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.
122
Mackay. 30 August - 3 September 1992
Third Large Open Pit Mining Conference
Passes(Loading Cat 78S Trucks)
4 4 4 4
Bucket Size 16m' 16m' 18m' 18m'
Face Dozer Face Dozer
Method
Loading Assisted
Loailing
Assisted
Loader Cycle Time O.5S 0.54 0.61 0.S9
Loader Time '" Excbange Time 2.20 2.16 2.44 2.36
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 32.9 34.S 34.6 37.4
Volumc m' Per Bucket Pass 19.1 20.1 20.2 21.8
Bucket Fill Factor (by Volume) 119% 126% 112% 121%
Bucket Fill Factor (by Weight) 104% 109% 109% 118';'
Tmck Body Capacity (m') 78 78 78 78
Volumc m' Loaded In Tmck 76.S 80.3 81 87
Loailin8 TonnoslHour 3,592 3,837 3,400 3,828
Combined Methods -TonnoslHour 3715 3614
Advantage In Tonnes 100
Advantage By Percent 3%
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
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.
BHP Ok Tedi mine
Highland Valley Mine
PNG
British Columbia Canada
Cypress Serrita Mine
Phelps Dodge China
Tuscon, Arizona
Silver City, New Mexico
Western Excavation Cornwall, UK
Salt Lake, Utah
RTZ Bingham Mine
Peter Kiewit USA contractor
USA contractor
H B Zachary
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,
Papua Now Guinea
Truck Fleet 1st. year or operation
94%
Truck Fleet AVOl3l!e for 25 unim to 28,500 hows
90%
Copper Mine TmcI< Fleet AVOl3l!e for
88%
British Columbia, Canada 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%
3rd year
86.2%
Copper Mine,
Arizona, USA
Truck FI..t Average for
14 unim to 25,500 hows
92%
Copper Mine, Truck Fleet Average for
24 unim to 27,300 hows
94%
UtIh, USA
Copper Mine, Truck FI..t Avera8e fot
17 unim to 23, 000 hours
1st year
2nd year
3rd year
4th year
88%
Chile
93%
95%
92%
90%
Oil Shal. Min.,
Truck Fleet Average for 15 unim to 24,000 hoUB
88%
Canada
Gold Mine, Truck FI..t Average for
17 unim to 37,600 hoUB
90%
Nevada, USA
Gold Mine,
Nevada, USA
Truck Fleet Average for
88%
26 unim to 35,000 hour.!
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.
Third Large Open Pit Mining Conference Mackay, 30 August - 3 Seplember 1992
123
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.
8 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
124
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.
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
Mackay. 30 August. 3 September 1992 Third Large Open Pit Mining Conference
Delivery Months of Total Annual
Date
Service HaUlS Hours
of Fleets
Gold Mine Nevada, USA Scp86
61 37,600 7,397
British Columbia,
Coal Mine June 86 64 35,000 6,563
Canada
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 Nay 88 35 21,200 7,269
British Columbia,
Copper Mine Jul88 ..39 21,000 6,462
Canada
Copper Mine Arizona, USA Jul89 27 16,000 7,111
BENCHMARKS OF PERFORMANCE FOR TRUCK AND LOADER OPERATIONS
work function has been suggested. Follows a summary of these
suggestions.
Benchmarks of performance
Production
efficiency
Mechanical
availability
Maintenance
manpower
Actual fleet production exceed 85 per
cent of maximum fleet production
potential.
Fleet Average exceeds 90 per cent to
machine economic life.
Maintenance man hours per operating
hour less than 0.25.
Maintenance
efficiency
Operating costs -
Utilisation
Eighty-five per cent of all workshop
repair work is planned and scheduled.
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 Equipment
(BHP Newman Maintenance Management Conference).
Third Large Open Pit Mining Conference Mackay. 30 August - 3 September 1992
125