Development of dynamic simulation for strategic planning of potash mine outbound logistics. Client — BHP Billiton, the world’s largest mineral resources company.
Period: October 2014 – April 2015
Industry: Mining
Client / Partner: BHP Billiton / Goldratt Research Labs
Project objective
- Generate a strategy for the development of the logistics network of potash mines for 2017-2045
- Choose the basic logistic network configuration
- Determine the storage capacity requirement as well as loading and unloading equipment requirement in seaports and land hubs
- Calculate and prove planned production costs of products delivered to the clients
The main stages of work and characteristics of the model
- Conducting working meetings, collecting the main data for the project
- The simulation model concept development
- Development of information requirement
- Managing of the data collection and its preparation for the modeling
- Development of the simulation model on the AnyLogic platform
- Development of inventory management and transport dispatching policies
- Verification and validation of the model
- Scenario analysis – comparison of more than 300 options of logistic network development
- Preparation of the report about simulation results
Model input data
- Strategic plan of potash production in mine in Central Canada in 2017-2045
- Loading and unloading operations performance, transport capacity, transportation speed
- Possible location options for 20 hubs and 31 seaports
- Demand forecast
- Consumers location forecast
The main structural elements of the model
- Input data file of scenario in MS Excel format
- Simulation model with interactive presentation, batch launch mode for fast scenario comparison, mode of sensitivity analysis
- Data aggregation module that allows to generate MS Excel files with the simulation results
Model output data
- Service level of clients supply
- Production costs of product unit delivered to the client
- Requirement for storage capacity, loading and unloading equipment in seaports and land hubs
- Demand for railway cars, car fleet utilization capacity
Project result
- The strategy of potash mine outbound logistic for 2017-2045 is developed
- Suggested algorithms of inventory management and car fleet management are justified
- Planned financial indicators of logistic network, including graph of planned production costs of products delivered to the clients by years, are calculated