INTERNATIONAL JOURNAL OF MINING, RECLAMATION AND ENVIRONMENT, 2018 https://doi.org/10.1080/17480930.2018.1435969 Stochastic orebody modelling and stochastic long-term production scheduling at the KéMag iron ore deposit, Quebec, Canada Maria Natalia Vallejo and Roussos Dimitrakopoulos  COSMO – Stochastic Mine Planning Laboratory, Department of Mining and Materials Engineering, McGill University, Montreal, Canada ABSTRACT Stochastic optimisation provides a framework that is capable of generating a strategic life-of-mine production schedule that increases net present value while simultaneously reducing the risk associated with geological uncertainty. This paper focuses on the application of the stochastic strategic mine planning for technical risk management in the KéMag iron ore deposit in Quebec, Canada, demonstrating the key steps of the framework. The approach irst quantiies both the volumetric and multi-element grade uncertainty of the deposit by generating a set of equally probable scenarios of the orebody. In this case study, the boundaries of the lithologies (volumetric uncertainty) deining the KéMag iron ore deposit are generated using a pattern-based wavelet simulation algorithm. The pertinent grade properties, namely, head iron, Davis Tube weight recovery, Davis Tube concentrate iron and silica content (multi-element grade uncertainty) are jointly simulated using the direct block minimum/maximum autocorrelation factors algorithm. Subsequently, the simulated scenarios of the iron deposit serve as an input to a life-of-mine stochastic integer programming production-scheduling model. The latter stochastic optimisation model is employed to manage and minimize the risk associated with the geological uncertainty of the deposit in terms of meeting production targets while generating a mining sequence of extraction maximising the net present value. The results of the case study quantify the risk associated with the product’s silica content, total iron production and expected discounted annual cash lows. 1. Introduction In general, an optimal open-pit mine production schedule is deined as the sequence of extraction that maximises the net present value of a mining project, subject to various technical and operational constraints. Deining a long-term production schedule is one of the most important tasks in the mine planning process because it deines the ore supply over the life-of-mine and, consequently, has a sub- stantial impact on the project’s net present value (NPV). Mine production scheduling optimisation is a complex process due to its size and the uncertainty of key input models, particularly the supply and quality of ore materials and the demand for the inal products sold. © 2018 Informa UK Limited, trading as Taylor & Francis Group KEYWORDS Stochastic mine planning; technical risk management; stochastic simulation; open- pit mine scheduling; iron ore deposit; strategic planning ARTICLE HISTORY Received 26 June 2017 Accepted 30 January 2018 CONTACT Roussos Dimitrakopoulos roussos.dimitrakopoulos@mcgill.ca