Abstract
In the earliest stages of mineral property development, it is essential to develop reasonable estimates of basic technical and economic parameters in order to determine whether the project has reasonable prospects for eventual economic extraction (RPEEE). In other words, is the property worth pursuing? To achieve this, it is necessary to have access to reliable cost data, including reasonable and tested rules of thumb.
Our team has undertaken a statistical analysis of over one hundred mining project data from publicly available NI 43-101 reports on feasibility studies conducted between 2015-2020. These studies are available on SEDAR. The NI 43-101 reports were reviewed to collect project data, including project location, production rate (annual and daily), tonnages (waste & ore), commodity type, ore geology, mining and milling methods, surface topography, average grades, strip ratio, ramp-up, recoveries, payables, mining Opex, processing Opex, G&A cost, initial Capex, sustaining Capex, and Closure cost.
The collected data were statistically processed to find relationships between the main cost parameters of mining projects based on their operational characteristics. The study results allow a better understanding of mining project costs based on historical data. For example, Taylor’s rule (correlating the total ore reserve to the daily production rate) can be applied to both surface and underground mining projects. Also, reasonable early-stage estimates of ECPM & Indirects, Closure costs, and Sustaining Capex can be based on the total initial capital cost of projects, and the G&A operating costs can be estimated as a percentage of the total operating costs.