A contractor operates a rock crusher and stores the material until needed in an adjacent stockpile area. The stockpile area is unpaved, and some of the produced material is contaminated by the sub-grade and cannot be used. The estimated stockpile losses are shownin Table 15-1. This equates to a combined loss of 8% each year.
Table 15-1 Current Stockpile Losses
Material Size Loss
¼" minus 12%-20%
¾" minus & ¾" x # 4 8%-15%
1 ½" minus & 1 ½" x ¾" 4%-10%
The contractor is considering paving the stockpile area to reduce the loss of material.
Paving the stockpile area would reduce the losses due to contamination to about 2%. The crusher produces 250,000 tons/year at a cost of $1.50/ton. The new paving should last 10 years, and there is no salvage value.
The paving will cover 4.56 acres. The previous stockpile losses will serve as sub-grade and base course for the new surfacing. A 3" thick surface will require 3700 tons of asphaltic Case 15 Pave the Stockpile Area?
95 concrete, which costs $20/ton installed since he can supply the material at his cost. The engineering and site work involve a one-time cost of about $5000. The surface requires routine maintenance costing about $1000/year.
The contractor has estimated lower and upper limits for the data as shown in Table 15-2.
Table 15-2 Lower and Upper Limits on Estimated Data
Economic life -50% +100%
Price/ton -20% +40%
Tons/year -40% +20%
Loss with paving -20% +20%
Design cost for paving -10% +10%
Maintenance -10% +20%
First cost for paving -5% +10%
1. Determine the rate of return on the repaving, and recommend whether the contractor should pave the area?
2. Use breakeven charts or a spider plot to analyze which uncertainties could change your recommendation.
3. Construct a tornado diagram to summarize your results for management.