Application of LCC techniques in selection of mining equipment and technology

Emerging technologies are revealing unprecedented opportunities for deploying new and improved machines/equipment that are more cost effective. However, selection of such technologies demands careful engineering and economic analyses. Generally speaking, in many companies, purchasing decisions are made on the basis of past experiences and suppliers reputation without any application of engineering and economical optimization techniques. If management decides to invest money for the implementation of the capital intensive new and emerging technologies and systems, life cycle costing (LCC) techniques can provide tools for engineering and economic analyses. The LCC analysis is an engineering and economical optimization technique where the main goal is to identify and choose alternative that generates the highest revenue over lifetime or in other words generates the lower life cycle cost. LCC techniques have successfully been applied in many other capital-intensive industries to make optimal decision regarding investment in capital equipment. This is an expository paper for the mining industry discussing the application of LCC as an engineering and economical optimization method while selecting capital-intensive mining machines/equipment.