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  • TASMANASIAPACIFIC

    BENCHMARKING THEPRODUCTIVITY OF AUSTRALIAS

    BLACK COAL INDUSTRY

    TASMAN ASIA PACIFIC Pty Ltd

    June 1998

  • TASMAN ASIA PACIFIC PTY LTD 1998

    Tasman Asia Pacific Pty Ltd

    PO Box 137

    LYNEHAM ACT 2602

    Telephone (02) 6247 0866

    Facsimile (02) 6247 0876

    e-mail canberra@tasman.com.au

    Tasman Asia Pacific Pty Ltd specialises in the quantitative analysis of policy issues,performance measurement and the provision of management advice to industry andgovernment both in Australia and overseas.

  • TASMANASIAPACIFIC

    TASMAN ASIA PACIFIC PTY LTD Page i

    Benchmarking the Productivity of Australias BlackCoal Industry

    CONTENTS

    EXECUTIVE SUMMARY........................................................................................... vi

    CONTENTS i

    LIST OF TABLES iv

    LIST OF FIGURES v

    LIST OF FIGURES (CONTINUED) vi

    LIST OF BOXES vi

    EXECUTIVE SUMMARY vii

    TRUCK AND SHOVEL PRODUCTIVITY BENCHMARKS viii

    PRODUCTIVITY AND COST OF TRUCK AND SHOVEL OPERATIONS xi

    DRAGLINE BENCHMARKS xii

    LONGWALL OPERATIONS xv

    MAJOR FINDINGS xvi

    1. INTRODUCTION 1

    1.1 STUDY BACKGROUND 1

    1.2 THE AUSTRALIAN BLACK COAL INDUSTRY A SNAPSHOT 1

    1.3 MINING TECHNOLOGIES 2

    1.4 OUTLINE OF THE REPORT 3

    2. BENCHMARKING METHODOLOGY 5

    2.1 SELECTING MINES FOR BENCHMARKING 5

    2.2 PRODUCTIVITY PERFORMANCE MEASURES 7

  • TASMANASIAPACIFIC

    TASMAN ASIA PACIFIC PTY LTD Page ii

    Benchmarking the Productivity of Australias BlackCoal Industry

    3. OPEN CUT TRUCK AND SHOVEL OPERATIONS 9

    3.1 THE CHARACTERISTICS OF THE BENCHMARKED OPERATIONS 9

    3.2 MINE OUTPUTS AND INPUTS 10

    3.3 TRUCK AND SHOVEL OPERATIONS TOTAL PRODUCTIVITY BENCHMARKS 123.3.1 Variation in productivity within mine categories 13

    3.4 FACTORS CONTRIBUTING TO PRODUCTIVITY DIFFERENCES 163.4.1 Efficiency of the labour force 173.4.2 Efficiency of truck operations 233.4.3 Efficiency of excavation equipment26

    3.5 THE LINK BETWEEN PRODUCTIVITY AND COST 313.5.1 High unit labour costs contribute to the high costs of operation 32

    3.6 OTHER FACTORS 343.6.1 Incidence of industrial disputes 353.6.2 Safety 353.6.3 Equipment maintenance 37

    3.7 ATTRIBUTES OF FRONTIER VERSUS MODERATELY PERFORMING MINES 39

    3.8 SUMMARY OF TRUCK AND SHOVEL ANALYSIS 41

    4 DRAGLINE OPERATIONS 43

    4.1 KEY CHARACTERISTICS OF THE BENCHMARKED MINES 43

    4.2 DRAGLINE TFP 444.2.1 Mine outputs and inputs 444.2.2 Dragline operations total productivity benchmarks 45

    4.3 FACTORS CONTRIBUTING TO DIFFERENCES IN DRAGLINE PRODUCTIVITY 484.3.1 Efficiency of dragline operations 494.3.2 Labour Productivity 52

    4.4 THE LINK BETWEEN PRODUCTIVITY AND COST 55

    4.5 SUMMARY OF DRAGLINE ANALYSIS 56

    5. LONGWALL MINING OPERATIONS 58

    5.1 KEY CHARACTERISTICS OF THE BENCHMARKED LONGWALL MINES 58

    5.2 FRAMEWORK FOR MEASURING LONGWALL PRODUCTIVITY 59

    5.3 LONGWALL OUTPUTS 60

  • TASMANASIAPACIFIC

    TASMAN ASIA PACIFIC PTY LTD Page iii

    Benchmarking the Productivity of Australias BlackCoal Industry

    5.4 INPUTS USED IN LONGWALL OPERATIONS 61

    5.5 TOTAL PRODUCTIVITY OF LONGWALL OPERATIONS 635.5.1 Efficiency of the labour force 655.5.2 Equipment productivity 705.5.3 Maintenance 71

    5.6 LONGWALL PRODUCTIVITY AND COST 72

    5.7 SUMMARY OF LONGWALL ANALYSIS 73

    APPENDIX 1: PRODUCTIVITY PERFORMANCE MEASURES 75

    APPENDIX 2: ESTIMATION OF TRUCK AND SHOVEL OUTPUTS AND INPUTS77

    A2.1 TRUCK AND SHOVEL OUTPUTS 77

    A2.2 INPUTS USED IN TRUCK AND SHOVEL OPERATIONS 79

    APPENDIX 3: ESTIMATION OF DRAGLINE OUTPUTS AND INPUTS 84

    A3.1 DRAGLINE OUTPUTS 84

    A3.2 INPUTS USED IN DRAGLINE OPERATIONS 85

    REFERENCES 88

  • TASMANASIAPACIFIC

    TASMAN ASIA PACIFIC PTY LTD Page iv

    Benchmarking the Productivity of Australias BlackCoal Industry

    LIST OF TABLES

    No. Title

    2.1 Characteristics of mines invited to participate in study ...................................... 7

    3.1 Key geological characteristics of mines with truck and shovel operations ........ 9

    3.2 Scope for productivity improvement using local mines as benchmarks ........... 15

    3.3 Partial productivity indicators of truck and shovel ........................................... 15

    3.4 Key labour operating practices ........................................................................ 21

    3.5 Inherent truck productivity ................................................................................ 23

    3.6 Key truck haul statistics for truck and shovel mines ........................................ 24

    3.7 Inherent truck productivity ................................................................................ 27

    3.8 Shovel loading practices .................................................................................. 28

    3.9 Shovel loading performance ............................................................................ 29

    3.10 Cost per tonne of mineral and waste removed, truck and shovel minecategories ........................................................................................................ 31

    3.11 Incidence of industrial disputation .................................................................. 34

    3.12 Typical costs of operating shovels ................................................................... 36

    3.13 Typical costs of operating trucks .................................................................... 37

    4.1 Characteristics of dragl ine operations: average per mine ............................... 41

    4.2 Total productivity of dragline operations ......................................................... 44

    4.3 Comparing the productivity of dragline and truck and shovel operations ofmines .............................................................................................................. 45

    4.4 Partial productivity indicators of dragline operations ....................................... 46

    4.5 Productivity performance of dragline operations ............................................. 48

    4.6 Capacity utilisation and improvements needed to match bestpractice dragline performance ......................................................................... 49

    4.7 Typical costs of operating draglines ............................................................... 49

    4.8 Number and composition of workers in typical shift ........................................ 515.1 Characteristics of mines invited to participate in study .................................... 56

    5.2 Assumed maximum working life for equipment in longwall mines ................... 60

    5.3 Cost shares in longwall operations: weighted average per mine ................... 60

    5.4 Partial productivity indicators of longwall operations ...................................... 63

    5.5 Cost of labour in longwall operations: average per worker ............................ 65

    5.6 Incidence of industrial disputation in longwall mines ....................................... 67

  • TASMANASIAPACIFIC

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    Benchmarking the Productivity of Australias BlackCoal Industry

    LIST OF FIGURES

    No. Title

    3.Error! Bookmark not defined.Average output and input truck and shovelmines ..............................................................................................................11

    3.2 Total factor productivity of truck and shovel operations .................................12

    3.3 Variation in total productivity within truck and shovel mine categories ...........13

    3.4 Labour productivity of truck and shovel mines ................................................16

    3.5 Staffing of equipment in truck and shovel mines ............................................18

    3.6 Composition of idle time in shifts at truck and shovel mines ..........................20

    3.7 Truck productivity............................................................................................22

    3.8 Truck utilisation in truck and shovel mines .....................................................23

    3.9 Excavation equipment productivity .................................................................25

    3.10 Utilisation of digging equipment in truck and shovel mines ............................26

    3.11 Percentage of mines predominantly using single-sided loadingtechniques ......................................................................................................28

    3.12 Total factor productivity and cost per tonne, truck and shovel operations:Australian and United States coal operations .................................................30

    3.13 Labour productivity and cost in truck and shovel operations ..........................32

    3.14 Breakdown of labour cost per face hour worked, truck andshovel operations............................................................................................33

    3.15 Open-cut mine safety......................................................................................35

    4.1 Average output and input dragline mines ...................................................43

    4.2 Total productivity of dragline operations .........................................................44

    4.3 Productivity of draglines .................................................................................47

    4.4 Dragline utilisation ..........................................................................................48

    4.5 Labour productivity in