liu.seSearch for publications in DiVA
Change search
ReferencesLink to record
Permanent link

Direct link
Open-pit mining with uncertainty: A conditional value-at-risk approach
University of Cape Coast, Ghana .
Linköping University, Department of Mathematics, Optimization . Linköping University, The Institute of Technology.ORCID iD: 0000-0003-2094-7376
Linköping University, Department of Mathematics, Mathematics and Applied Mathematics. Linköping University, The Institute of Technology.
2013 (English)In: Optimization Theory, Decision Making, and Operations Research Applications: Proceedings of the 1st International Symposium and 10th Balkan Conference on Operational Research / [ed] Athanasios Migdalas, Angelo Sifaleras, Christos K. Georgiadis, Jason Papathanasiou, Emmanuil Stiakakis, New York: Springer, 2013, 117-139 p.Conference paper (Refereed)
Abstract [en]

The selection of a mine design is based on estimating net present values of all possible, technically feasible mine plans so as to select the one with the maximum value. It is a hard task to know with certainty the quantity and quality of ore in the ground. This geological uncertainty and also the future market behavior of metal prices and foreign exchange rates, which are always uncertain, make mining a high risk business. Value-at-Risk (VaR) is a measure that is used in financial decisions to minimize the loss caused by inadequate monitoring of risk. This measure does, however, have certain drawbacks such as lack of consistency, nonconvexity, and nondifferentiability. Rockafellar and Uryasev [J. Risk 2, 21-41 (2000)] introduce the Conditional Value-at-Risk (CVaR) measure as an alternative to the VaR measure. The CVaR measure gives rise to a convex optimization problem. An optimization model that maximizes expected return while minimizing risk is important for the mining sector as this will help make better decisions on the blocks of ore to mine at a particular point in time. We present a CVaR approach to the uncertainty involved in open-pit mining. We formulate investment and design models for the open-pit mine and also give a nested pit scheduling model based on CVaR. Several numerical results based on our models are presented by using scenarios from simulated geological and market uncertainties.

Place, publisher, year, edition, pages
New York: Springer, 2013. 117-139 p.
, Springer Proceedings in Mathematics and Statistics, ISSN 2194-1009 ; 31
National Category
URN: urn:nbn:se:liu:diva-106239DOI: 10.1007/978-1-4614-5134-1_8ISBN: 978-146145133-4 (print)ISBN: 978-1-4614-5134-1 (online)OAI: diva2:714909
1st International Symposium and 10th Balkan Conference on Operational Research, 22-25 September 2011, Thessaloniki, Greece
Available from: 2014-04-29 Created: 2014-04-29 Last updated: 2014-05-08Bibliographically approved

Open Access in DiVA

No full text

Other links

Publisher's full text

Search in DiVA

By author/editor
Amankwah, HenryLarsson, TorbjörnTextorius, Björn
By organisation
Optimization The Institute of TechnologyMathematics and Applied Mathematics

Search outside of DiVA

GoogleGoogle Scholar
The number of downloads is the sum of all downloads of full texts. It may include eg previous versions that are now no longer available

Altmetric score

Total: 177 hits
ReferencesLink to record
Permanent link

Direct link