XERAS is proving to be very effective at a number of mining operations. XERAS is being used for detailed long-term budget planning as well as detailed annual budgeting to the expense account level. One of the major benefits of XERAS in this role is its ability to estimate the life cycle costs of maintaining equipment. In particular, XERAS estimates the cost of major components using built-in event scheduling functionality. The event scheduler allows costs to be scheduled for specific timing in the equipment life cycle.

For example, a minor overhaul costing $20,000 could be scheduled for 10,000 engine hours. A major overhaul costing $200,000 could be scheduled for 25,000 engine hours. The value of incorporating this functionality into your financial model is that the true equipment costs are sensitive to the equipment utilisation. This in turn can be linked directly to the production planning options. If you work the equipment harder, you will see maintenance costs being scheduled earlier.

Recently, Runge developed an Equipment Maintenance Budget Model. This model can be easily adapted for most mining operations and can be used to produce equipment maintenance budgets built up from individual components. Moving to this level of detail allows far greater refinement of the budgets and a documented means of justifying the expenditure.

This model was initially prototyped when Mick Spencer, a Senior Planning Engineer with BHP Billiton’s Gregory/Crinum Mines, and long time XERAS user, required an improvement over an existing spreadsheet application for building up an equipment budget. Component change outs were controlled by either, machine engine hours, production quantity (tonnes in this case) or calendar days. The model could report detailed components schedules for each unit capturing, material costs, labour hours, contract labour hours as well as equipment delays. The detail data was consolidated into maintenance expense accounts then consolidated to a fleet and mine basis.

Spencer said: “Today I actively use XERAS as a zero-based maintenance budgeting tool. I have up to six users on site (both open cut and underground) who use separate but generic component based cost models to forecast month-by-month costs twice a year. The XERAS format works well as the users are free to expand detail without continually blowing apart the basic calculation logic.

“XERAS has proved to be an excellent way of managing a complex web of spreadsheets. I try not to use fancy algorithms, and prefer using a simple repeatable logic that fits all situations. The models are set up so anyone can input their own data and let the calculation happen.

Spencer added that the down side at the moment is calculation speed, as parallel calculations are not possible. He said this was only a problem at the back end of the work as people typically calculate each sheet as they go.

“XERAS is not the “be all and end all” for me - it is just another tool that works well for some things and not others. I use it for things that need a high degree of structure and a reasonable life expectancy for the contained logic as set up time is greater when compared with simple spreadsheet applications,” Spencer said.

This initial Equipment Maintenance Budget Model has been considerably restructured in the new Pro-forma version. This will make it more general, easier to modify and faster to calculate. Using XERAS for this type of application provides an easy means to create and maintain equipment data and is considerably more reliable than a conventional spreadsheet application.

You can link the very detailed equipment budget model to your full mine budget model. Depending on the construction of your equipment cost centres you would import the cost centre-expense account results either by individual unit or by fleet aggregations. Both models would be linked to the mining schedule to ensure that the equipment budget was being driven by the mine plan. Results can be in summary reports or the detail can be exported for upload into your General Ledger.