Integrating optimization and simulation - A comparison of two case studies in mine planning

This paper describes the benefits of integrating optimization formulations within simulation models. Two different case studies in mining are presented, both requiring a blending optimization. The primary problem at hand is to model a complex supply chain involving blending of multiple inputs to produce a number of potential products for customers. The first approach involves solving an optimization model to produce a long term plan, then simulating this plan over time without the ability to change the plan as time progresses. The second approach involves a more integrated system where multiple instances of an optimization model are run throughout the simulation using updated inputs. A description of the problem is supplied, providing the need for both optimization and simulation, and then the two case studies are compared to show the benefits of integrating the optimization within the simulation model.