Introduction:
BHP, Australia’s largest company and a global mining giant, sought to expand its Western Australian Iron Ore output amidst growing demand from Asian markets. This case study delves into how BHP collaborated with De Leo Consulting to harness crowd wisdom and streamline the rail expansion study process.
Client Introduction:
BHP operates a vast portfolio of mining assets, including tier 1 iron ore, copper, coal, nickel, and potash reserves. Its iron ore business, located in the Pilbara region of Western Australia, accounts for a significant portion of global seaborne iron ore supply. To sustain growth, BHP required a comprehensive assessment of rail capacity expansion options.
Problem:
Edgar Basto, BHP’s Asset President, faced the challenge of identifying cost-effective investment alternatives to expand iron ore output to 330MTPA. The focus was on enhancing rail capacity, a critical component of BHP’s supply chain, spanning a 1,200km network linking mining hubs to port facilities.
Solution:
De Leo Consulting introduced a novel approach to the rail expansion study by leveraging crowd wisdom and benchmarking against global railway operations. Publicly available data on major iron ore and coal railways worldwide provided insights into traffic density and investment patterns. This approach minimised reliance on Engineering Service Providers (ESPs) and accelerated the study phase.
Results:
The study identified targeted investments in both above and below rail assets to unlock over 20MTPA of additional capacity. Through advanced supply chain modelling, each investment option’s impact was evaluated in conjunction with mine and port expansions. Notably, the study identified additional investment options not originally in scope.
Conclusion:
By harnessing crowd wisdom and minimising reliance on ESPs, BHP efficiently identified and modelled rail capacity investment options. Concept designs were developed for cost estimation and scheduling, streamlining the decision-making process. The study underscores the value of leveraging industry insights and benchmarking to inform strategic investments in critical infrastructure.
This case study highlights how BHP collaborated with De Leo Consulting to optimise rail expansion strategies, demonstrating the efficacy of crowd wisdom in addressing complex infrastructure challenges.