A Parametric Model for Evaluating the Impact of Mine Mill Integration Approaches on Resource Economics
Scott Dunbar, Bern Klein, Malcolm Scoble,
A fast and objective spreadsheet-based model for the financial evaluation of innovative mining and processing strategies such as pre-concentration vs. a conventional base case is presented. The size and grade of the deposit must be chosen, from which a mining rate is selected. Expected operational data for the deposit as well as any mill testwork and results from the pre-concentration testwork are entered as input variables on the sheet, and cost and revenue impacts are calculated in the ‘Output’ sheet. A capital sum and operating costs for the initial mine and mill development as well as the pre-concentration facility are calculated. The net changes in capital and operating costs are calculated, and impacts on revenue through changes in metal recovery are also calculated. These outputs are used to calculate the overall impact on the cutoff grade and thus the size of the mineral reserve using a generic grade-tonnage model. The NPV and NPV profile of the two scenarios is calculated, with variations in basic parameters such as operating cost, capital requirements, metal price or grade as well as discount rate. Cost and revenue impacts are evaluated and compared to the baseline to establish a positive or negative impact overall. Different scenarios of grade, tonnage, mining rate, process performance, capital and operating cost structure can be explored using the model. Outcomes projected by the model for case studies conducted thus far have been calibrated against internal estimates by the sponsoring organizations and found to be accurate to within 30%, confirming the utility of the model in practice.
mine mill integration, Cost estimation, life of mine, Modelling, Metal recovery, resource economics