An integrated approach to determine the transition limit from open pit to underground mining

Determining the transition limit from the open pit mining to an underground mining method is one of the key decisions where there is the possibility to mine using both open pit and underground mining methods. Transition level is a depth where open pit mining is the best choice above this depth and underground mining is prioritized below it regarding the technical and economic aspects. In the early-stage mine planning studies, including the determination of transition limit, simplicity, practicality, and quickness of decision making are of the requirements, while achieving the acceptable answers is regarded. In this research, a practical approach based on combining Lerchs and Grossman algorithm and the Equilibrium Stripping Ratio (ESR) method is proposed to determine the transition limit. For this purpose, firstly nested and developing pits are generated with the objective of maximizing the net present value (NPV), then the Incremental Stripping Ratios (ISR) of each of these optimal developing pits are calculated. According to the alternative underground mining method(s), the ESR is calculated and finally, the transition limit will be determined comparing the ISR of these developing pits and the calculated ESR. In the present research, this approach is applied to determine the transition level in an iron ore deposit. To verify the determined transition limit, calculating the cumulative net present value shows that mining by underground method below the determined transition level can increase the NPV by 23% compared to continuing open pit mining.