Open Pit vs. Underground Mining
Two Ways to Get Rock Out of the Ground
Two ways to get rock out of the ground, and why the choice drives costs.
There are two main ways to mine a deposit: dig a giant hole from the surface, or tunnel down to reach the metal. The method a company uses shapes its costs, its risks and how much of the deposit it can profitably extract.
- Open-pit mining digs down from the surface; underground mining reaches the deposit through tunnels and shafts.
- The choice depends mainly on how deep the deposit is and how the valuable rock is spread out.
- Open pits are usually cheaper per tonne but move a lot of waste rock; underground mines cost more but are more selective.
- The mining method affects a project's costs, safety profile, environmental footprint and mine life.
- Some mines use both — starting as an open pit and going underground as they get deeper.
The Simple Difference
Imagine the metal is buried in a hillside. You can either scrape away everything above it until you reach it — an open pit — or you can dig a tunnel straight in to the metal and leave the rest of the hill in place — underground mining. Both get you the metal; they just do it very differently.
Open-Pit Mining
In an open-pit mine, the company removes the rock covering the deposit and then digs downward in a series of wide steps called benches, forming a giant bowl. Huge trucks and shovels move enormous volumes of rock.
To reach the metal, miners also have to move rock that contains little or no metal, called waste rock. The ratio of waste rock to valuable ore is known as the strip ratio — a higher strip ratio means more digging for the same amount of metal, which raises costs.
- Usually lower cost per tonne
- Can mine very large volumes quickly
- Generally simpler and safer to operate
- Can recover a high share of the deposit
- Only works when the deposit is fairly shallow
- Moves large amounts of waste rock
- Larger surface footprint and visual impact
- Costs climb as the pit gets deeper
Underground Mining
In an underground mine, the company digs tunnels or sinks shafts to reach the deposit, then extracts the ore through those passages. Because they follow the valuable rock more precisely, underground mines move far less waste.
This precision comes at a price: tunnelling is slower and more expensive, requires ventilation and ground support, and is generally more technically demanding and higher-risk than surface mining.
- Can reach deep deposits open pits can't
- Moves much less waste rock
- Smaller surface footprint
- Targets narrow, high-quality zones selectively
- Higher cost per tonne
- Slower to build and to mine
- More complex and higher safety risk
- Often recovers less of the total deposit
Side by Side
Why It Matters to Investors
The mining method is one of the biggest drivers of a project's economics. A shallow, low-cost open pit and a deep, high-cost underground mine can hold the same metal yet be worth very different amounts, because their costs and profit margins differ so much.
When you read about a project, it's worth noting:
→ Is it an open-pit or underground mine — or a mix of both?
→ For open pits: what is the strip ratio, and how deep does the pit go?
→ How does the method affect the project's cost per tonne and expected margins?
Neither method is better in general — each suits a different kind of deposit. What matters is whether the chosen method fits the geology and still leaves room for the project to make money.
Once you know how a deposit gets mined, the next skill is reading the drill results that reveal what's actually in the ground.
Next in the Mining 101 Series
How to Read Drill Results
Decoding intercepts, grades and widths in a company's news release.
Continue →