Medium range optimization of copper extraction planning under uncertainty in future copper prices ?
A stochastic model for strategic planning in copper mines is presented. The uncertainty in copper price is represented via a multistage scenario tree. Risk management strategies are presented (VaR, CVaR, MEAN-RISK, SDC). Deterministic, risk neutral and risk averse approaches are compared. Risk averse ones give better solutions than the others: bad scenarios have greater profit and lower probability to appear.
mining risk aversion planning models copper price uncertainty multistage stochastic mixed 01 optimization