What is the business case for an external haul road management service?

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It is common for many mines to assume the responsibility of haul road management internally. This includes designing and constructing new haul roads, implementing dust control measures and conducting ongoing maintenance work. 

The result of this internal approach can often lead to higher than necessary operating costs for the mine. This is usually due to a lack of specialised knowledge about how to get the maximum ROI from a haul road network. Without experienced personnel overseeing haul road projects, roads are often poorly planned. They are rushed to be constructed and when active are neglected and end up deteriorating quickly, creating the need for constant and costly repair work.

This reactive, short-term approach to haul road management often leads to costly long-term effects. There are experienced external service providers available which specialise in haul road management solutions and can help mines unlock significant operational savings. Yet mines will often forgo these service providers, believing that their costs are too high and there is little to no business case for them. 

In this blog post, we take a closer look at the total costs of managing a haul road network and how partnering with an external provider can deliver a much higher ROI. 

 

Free Download: Haul Road Managed Service Case Study

 

How much is your haul road network actually costing your mine site?

All mines are driven by the bottom line. For a mine to be as profitable as possible, a relentless pursuit of innovative and strategic thinking is required in order to deliver operational improvements and efficiencies directly impacting operating profit.

A major contributing factor to high haul road costs is the tendency of mine sites to rely solely on water carts for dust control purposes. This approach is often seen as the easiest and most cost-effective solution. But when haul roads are constantly watered to keep the dust down, the road wearing surface degrades more rapidly, graders are then required to remove fines and smooth out potholes, corrugation and rutting in the road more frequently to make it safer for haul trucks to travel on. This approach to dust control actually drives up operating costs. When the roads inevitably dry out, they need to be watered again. And so the cycle continues. 

Some mines will invest in the use of dust control binders such as lignosulphonate based products for their water carts as a total or partial replacement to using water alone. However, many mines self-managing their roads will find that these additives do not work as effectively as intended. This is usually the result of incorrect product dosages, spraying the treatments too frequently or too infrequently, a lack of operator training or poor programmed maintenance of the roads. 

Because haul roads represent such a critical asset to any operating mine, managing the road network effectively can unlock simple production efficiencies and significant improvements to the bottom line. However, when considering how much it actually costs to manage a haul road network, it is easy to overlook the unintended consequences of poor management including:

  • Higher fuel costs for the haul fleet as a result of rough, uneven and poorly draining road surfaces
  • More frequent replacement of damaged haul truck tyres and servicing caused by roads in poor condition
  • Excessive water use in the water carts
  • Over investment in capital and operating costs of graders and water carts 
  • Higher than necessary labour costs for mobile plant operators because of larger crew requirements.
  • More frequent maintenance to roads which have deteriorated due to constant watering and poor drainage
  • Production impacts associated with low speed events or stoppages due to dust levels, increased interaction with maintenance plant and poor road conditions.

Despite wanting to reduce these operational costs, decision makers can easily overlook the obvious changes that could be made. 

Let’s look at the following scenario as an example:  A mine site is running water carts 24/7 to water unsealed haul roads for dust control purposes on a large open cut mine. This operation deploys a large fleet of water carts and graders to achieve the dust control.  For every water cart and grader, there is a least an operator for day shift, night shift and a back to back crew covering the off swing for the first. This alone represents a significant operating cost on plant, maintenance and labour. 

A holistic haul road management plan, developed and implemented in conjunction with an external service provider, will significantly reduce the cost of this operating model and the reliance on a large fleet of water carts. Reducing the fleet means that mines can then redeploy available operators elsewhere and into production tasks, such as operating haul trucks. Here’s exactly how one mine did it and the results.

 

How can an external haul road service provider reduce operating costs?

When an effective road management plan is put in place by an external provider, roads are designed, constructed and maintained by engineers and specialists who are highly experienced in haul roads. They have the knowledge to ensure that a haul road network performs as effectively and cost-efficiently as possible.

Additionally, better dust control strategies can be implemented by trained project supervisors, such as the proper use of a lignosulphonate binder or bitumen emulsion. When used at the correct dosage levels at correct intervals, haul roads only need to be sprayed a couple of times a day or even a week, not continuously.

As world leaders in haul road management, Dust-A-Side has partnered with hundreds of mines to deliver exceptional ROIs on haul roads. We offer two levels of service to mines - a Managed Service and a Full Service.  

 

1 - Managed Service: 

Under a Managed Service, clients enjoy the benefits of a controlled establishment and maintenance program that ensures the correct use of dust binders and maintenance reapplications are only conducted when needed.  

Our Managed Service involves the provision of a full-time, on-site project supervisor to work with and train water cart operators, supplied by the mine, on equipment run by the mine, in the correct use of dust control products and surface treatments that improve road quality.

This supervisor further manages the establishment and ongoing maintenance of the haul road treatment program which is aligned with QA processes. A bulk liquids delivery and storage solution is also included in the service for projects of an adequate scope to deliver lower product unit costs. Even with a base line managed service agreement in place, Dust-A-Side has been able to deliver savings of more than double the service costs to the mine

 

2 - Full Service: 

For optimal cost savings, Dust-A-Side offers a Full Service turnkey solution for mines.  The service incorporates the transportation and storage of suppression products, road preparation, road establishment and ongoing maintenance.

In comparison with our Managed Service, our Full Service includes the provision of all personnel including on-site supervisors and operators as well as plant and equipment such as water carts and graders. 

Under a Full Service, clients contract the haul road maintenance program to Dust-A-Side and they enjoy the implementation of a QA process that delivers significant water consumption savings, safer roads and greater maintenance and operational cost efficiencies. 

 

Mines can expect the following cost reductions and improvements when partnering with Dust-A-Side:  

  • Reduction in water usage by 90%+ 
  • Increased productivity - up to 30% reduction in rolling resistance
  • Improved tyre life by 7+%
  • Reduction in fuel consumption by 5+%
  • Off-hire of water carts and graders
  • Reduction in water cart and grader operator salaries  
  • Reduction in downtime 
  • Reduction in uncontrolled movements and other accidents
  • Certainty of costs - the costs of managing your haul road network will be far more predictable 

Considering these cost savings and improved levels of productivity, it can be seen that there is in fact a strong business case for mines to consider employing a haul road management service provider. 

 

Free Download: Haul Road Managed Service Case Study

 

Want to see the business case for partnering with Dust-A-Side?

Simply get in touch with us today or click here to arrange an on-site technical consult and report.

We’ll provide you with a detailed cost analysis based on the size of your haul road network.

We’ll also provide you with figures showing how soon you’ll break even by engaging our services and how much you will be likely to go on and save on operating costs.

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