A study on the feasibility of mining the recently discovered Wallaby gold deposit is due for completion by mid-2000. Open pit mining is the favoured method. Determination of the impact of mining bench height on the recovery of ore, including the estimation of dilution and ore loss, is critical to the economics of the operation. Conditional simulation was used to derive a number of gold estimation scenarios within a typical volume of the deposit. These scenarios were interrogated for a selection of mining bench heights and ore block dimensions. The results were reported as a range of grade tonnage relationships and compared to the kriged resource model. This allowed the resource model to be calibrated to a specific mining bench height and ore block size. Once calibrated, more realistic dilution and ore loss values for a number of mining bench heights were calculated from the resource model. These values were then used to determine the economic sensitivity of particular mining methods. The spread of results from the simulations also provided an indication of the confidence in the kriged grade estimates for the different zones of mineralisation within the deposit and highlighted areas of any significant uncertainty.