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By J. C. Agarwal

Major scientific discoveries cannot be programmed. New or frontier technology, however, can and should be planned. It is the vital force underlying the business strategy of a vigorous and profitable mining and metals company. Generally, a radical departure from existing technology is required to 1) Enhance the competitive value of ore reserves, i.e., to turn low grade or marginal reserves into competitive reserves. 2) To increase yield and decrease costs. 3) To decrease investment. 4) To increase mine life. 5) To improve product quality to meet market demands. The very definition of frontier technology implies that it is so different that the old plant, if already in use, will not be directly suitable to use the new technology. Therefore, a priori, we know that the commercialization of frontier technology would very likely involve new investment. The recommended technique of economic and technical analyses, I propose to call "Success Analysis.'' Simply stated, it forces us, by step- by-step procedure, to ask "what is needed to succeed in this particular project." Therefore, the first step is to identify what is meant by "success." The definition of "success" requires an agreement with top management or sponsors of the project as to what constitutes "success" in their minds as contrast to the technical people perception of "success." In general, top management would define success as meeting: 1) The technical objectives, i.e., technology being developed would produce the desired product at the acceptable quality. 2) Financial objectives, i.e., when commercialized, the project's capital cost, operating costs and return on investment are better than the projects they would normally fund. The return has to be better because new technology is inherently riskier. 3) Marketing objectives in that the project will produce product of acceptable quality in timely manner, i.e., scale-up to commercial plant would not cause undue delays in start-up and that large fix-up expenditure would not be required to protect the projected return on the investment. Many projects are started in the laboratory to develop "Frontier Technology" in mineral processing. Most of these efforts are never commercialized. There are many causes of these failures. The major causes are listed below: 1) Inadequate communication with the sponsors of the project so that project objectives are defined and agreed to by all. 2) Ill-defined technical problems. 3) Incomplete development of technology. This has two major components: a. Incorrect scale-up and engineering. b. Inadequate start-up and maintenance planning. 4) Incomplete and over-optimistic process economics. 5) Lack of understanding of the future behavior of the marketplace. 6) Failure to complete R&D effort by the time it is needed. 7) Incorrect projections of human resources required; that is, technical, managerial and operating. 8) Lack of realistic forecast of the expenditures required for commercialization of the R&D effort. These pitfalls can be avoided by comprehensive planning and the use of success analysis technique. The major elements in "Success Analysis" are: 1) Identification of the "need" for new technology. 2) Unbiased and complete scale-up engineering. 3) Acceptable economic feasibility with enough margin of error in the sale prices and operating costs to justify the inherent risks in frontier technology. 4) Timing for availability of investment capital and markets. Many failures in the development of frontier technology are preordained because the initial selection of the research project has been without adequate attention to the needs of the industry. Many very innovative hydrometallurgical processes for recovery of copper from concentrates were developed in the past twenty years. They have not adapted except to a very minor extent because they did not satisfy the success analysis criteria. The copper industry in North America needed a process to compete against high grade ores and to avoid

Jan 1, 1985

By E. A. Rychkun

"For the last 700years of recorded economic history, man has been subjected to alternating inflationary and deflationary patterns. Through this period of time, a severe deflationary pattern has developed approximately every 55 years, creating 12recordable occurrences. Through the last two centuries, this severe deflationary phenomenon has come to be known as a depression. As these depressions have repeated themselves regularly, they are cyclic. This in turn leads to the question of whether the 13th cycle will also repeat itself in the form of a depression. As this cycle is now 51 years old, we must consider the possibility at about 1984.In analyzing a 700-year record of consumer prices in Southern England, the 55-year cycle appears to vary in shape and intensity. This varying phenomenon is due to the effect of longer cycles upon which each one ""rides "". Because each cycle effectively rides on the next largest, which in turn rides on the next largest and so on, the combined measured effect of all cycles together at any point in time is always unique. This means that anyone cycle can never repeat itself in an exact identical manner. The combined effect therefore is what we observe in the form of prices and, as cycles interact, variations in deflation are produced . The ""science"" of economics attempts to quantify and develop theory on situations which are never identical and hence can be conservatively classified as a useless predictive tool.This means that more unconventional approaches may be required to predict our economic future. In looking at previous depression cycles, it is possible to recognize similarities in human behaviour patterns and hence the resulting economic movements. These behaviour patterns create major events or influencing factors which set the scene for a major deflationary condition. The way in which these factors occur, however, is not predictable. As more and more of these similar events are identified in each cycle, we can increase our confidence on the probability of the last event occurring (a depression). By also unravelling the set of larger cycles, we can determine the potential combined effect at any point in the future.This paper presents a system of cycles ranging from 800 years to 3 years which appear to operate in our economic system. By so doing, a long-term projection into the next century can be made. Finally, the paper deals with the main controlling similarities within the depression cycle, to show that a comparison with our current cycle implies that a major deflationary collapse in the mid 1980's is virtualy inevitable."

Jan 1, 1980

By James Boyd

All mining and milling enterprises must be based on adequate ore reserves. Reserves must be established by physical exploration, and the orebody should be of sufficient size and grade to insure recovery of capital invested in mine purchase, development, and mill construction and to provide a reasonable profit. Determination of these economic factors is so complicated, and present costs of mine development and construction so great, that analysis can be made only by competent persons qualified by experience in this field. What rate for maximum efficiency? Unfortunately, even today mills are built before deposits have been adequately outlined, and there are rusting monuments to such folly in nearly every mining region. Also there is a tendency to be guided by the philosophy that "if a little is good, a lot is better," which leads to the conclusion that mining at a given rate and making so much per ton will yield a profit of so many dollars per day. Consequently, why not build a mill to treat twice as much per day and make twice as much money?

Jun 1, 1956

By R. Brantley Sudderth

There are three broad categories in which most solvent extraction technology can be distributed?: 1) reagents, 2) equipment, and 3) systems. Reagents which are now used in commercial solvent extraction plants are of many chemical types, and each possesses certain properties which make it more economically desirable than another alternative. The equipment which is' used in solvent extraction plants for contacting the organic and aqueous phases and separating the same is varied. Most common to the industry is the mixer-settler unit which in itself, can be of varied design; but many new innovations in contacting and separating equipment have been recently introduced or are :now being studied. Each specific solvent extraction application will often dictate the type of contacting and separating equipment used. Obviously, the trend is toward smaller less expensive equipment which reduces the often expensive organic inventories necessary for most solvent extraction plants. The current thrust of .investigations in ancillary equipment is usually aimed at recovering organic from solvent extraction sludges or from aqueous streams exiting the process.6 This type of equipment helps to reduce the total organic losses from solvent extraction plants and thus reduce the operating costs. The term "systems" in solvent extraction applies to the manner in which a solvent extraction process is carried out. This manner is usually dictated by the properties of the reagent which is used, and it involves a tailoring of the equipment or the process flowsheet. Some of the things which can be tailored are: 1) The aqueous media -whether acidic or basic and what type of acid or base 2) Counter-current or single stage (co-current) contacting 3) EMF or pH control 4) Organic "crowding" alternative 5) Heating or cooling process streams Regardless of the type or extent of tailoring, efforts to do this are usually a result of the low cost of solvent extraction as a unit process.

Jan 1, 1977

By Hu Harries

WE RECENTLY completed a study for a client, who is an applicant to export gas from the Province of Alberta, on the effects of gas export on Alberta's economy. This study was part of the client's application ?before the Conservation Board, and, no doubt, some of you are familiar with it. Submissions by other applicants in earlier hearings before the Board and before the Royal Commission on Energy, as well as claims made by parties opposing export, have also brought forward a number of other opmwns regarding possible economic effects. Ali of these studies have been on a piecemeal basis. They have dealt with particular aspects of particular applications, and only indirectly and by inference with the overall question of gas ex-port. We have prepared this paper to review the overall picture and ex-amine, as far as time permits, all sides of the question. While the paper is entitled Economic Effects of Gas Export on Alberta, we felt that the area considered should in-elude northeastern British Columbia, not only because Westcoast, the first major gas export project, is essentially a northeastern B. C. project, but because this area has historically been, from the point of view of economic, if not of political, geography, part of Alberta. In this paper, when we talk of export, we mean export from the Province or, in this case, from Alberta plus northeastern B. C. Sales to other parts of Canada have exactly the same effect on the economy of this area as l1ave sales to the United States, provided, of course, they are made on equal terms.

Jan 1, 1958

By Leonard Bronitsky

The construction mineral aggregates industry--the largest industry on a tonnage basis--is threatened with large shortages in the near future. Ironically, these common minerals which include sand, gravel, and stone are among the most plentiful in the earth's crust. However, as these minerals are low in value and used in large volumes, they are extremely sensitive to transport cost, e.g., a haul of 20 miles doubled the delivered cost of mineral aggregates. Consequently, these minerals must be located close to points of demand to have economic usefulness. But the development of new deposits is virtually impossible near many urban areas for legal, sociological and economic reasons. The spector of unfinished urban transport systems, curtailed residential construction, and a general deterioration of the physical urban plant, looms as a direct consequent of future mineral aggregate shortages in the U. S. metropolitan areas. The shortages of mineral aggregates in the Greater New York Metropolitan Area (G.N.Y.M.A.) are prototypical of the shortages faced by the U. S. Metropolitan areas. This paper presents an economic analysis of the consequences of not considering the broad aspects of conservation economics as a major component of resource management. The needless annual cost for the G.N.Y.M.A. is shown to be $30 million.

Jan 1, 1974

By Felicia F. Peng

An economic analysis for evaluating coal preparation plants in the Appalachian Region is presented. A complete coal preparation plant which includes multi-streams and/or multi-stages coal cleaning circuits, complete closed water circuits, environmentally acceptable refuse disposal and reclamation systems is used to determine the capital and operating costs. The plant is capable of producing metallurgical grade clean coal or deep cleaned steam grade coal for future power generating plants use. Utilizing a profit maximization as a decision criterion, an optimal yield, and optimal coal clean¬ing circuits, closed water circuits, and disposal and reclamation systems for a given coal characteristic may be selected among the process alternatives by using a process simulation-economic model of the coal preparation plant. A deterministic analysis is used to calculate the discounted-cash-flow interest rate of return (DCFIROR) and project the selling prices, and determine the Return on Investment (ROI) for the cases of 32.65% and 52.74% plant utilization with producing two cleaned products. Sensitivity analyses are performed to quantify the effect of total capital investment, operating cost, run-of-mine cost and yield on an economic criterion-ROI and selling prices. A probabilistic evaluation using the Monte Carlo simulation technique is further made to quantify the risk involved in obtaining the desired profit levels. The results of the economic analysis for a given coal preparation plant configuration and characteristics of raw coal indicates that the selling prices of producing two cleaned products are greatly affected by the change in percent of plant utilization (production schedule), yield, and run-of-mine cost, and total capital cost. The sensitivity analysis also shows that the total capital investments has a three times greater effect on required selling prices than operating costs. The risk analysis shown that the overall economics look very attractive with current coal sale prices and 52.74% plant utilization.

Jan 1, 1979

By Brian W. Mackenzie

The mine development decision is made on completion of exploration to determine whether or not a mineral deposit should be developed to production and, if so, how. This involves the selection of an optimum mine development alternative from a number of technically feasible alternatives and the comparison of this optimum with those of other available investment opportunities. If the optimum is sufficiently attractive, the deposit is developed to production. The selection process is carried out within a framework of corporate objectives and resources. The mine development decision is based on the balancing of two parameters - - rate of production as reflected in plant capacity and cut-off grade. On the basis of available information and experience, detailed revenue and cost 'estimates are made for each feasible combination of plant capacity and cut-off grade. What economic evaluation techniques should be applied to these estimates to reduce each alternative to economic indicators that will enable meaningful comparisons and an informed investment decision? This is the essence of the paper. The determination of optimum plant capacity and cut-off grade has been the subject of intensive research efforts by economists and mining engineers (1-7). Their studies are based on marginal analysis and assume that, at the time of decision, certainty conditions prevail with respect to ore reserves, mining costs and mineral markets. The optimum mine development alternative is defined as that which maximizes profitability.

Jan 1, 1969

By J. R. Evans

Mining claims must have a discovery of a valuable mineral deposit to be valid. When required, a Federal government mineral examiner makes a determination of validity and recommendations thereof to authorized management officials. The examiner should show whether or not an existing mining operation, or a proposed operation have economic viability. This is accomplished through an analysis of legal entities, land status and use, geologic and mineralogic relationships, and mining, milling and processing techniques considered in an appropriate economic evaluation framework. A framework involves market and market entry studies, reserve analyses, all costs analysis, royalty buyouts, tax structure, discount rate of return, and escalation and risk factors. An income approach to value is then used by means of a simple or complex discounted cash flow (DCF) analysis to certify validity. Whether one claim is owned by a single miner, or hundreds of claims are owned by a large corporation, thorough, fair, consistent, and appropriate economic concepts should be applied by the mineral examiner.

Jan 1, 1993

By C. N. Bailey

Let's review the economic factors in mill design. Talking about engineering economics in mill design reminds me of an old' saying "There are several ways to handle women but nobody knows what they are." I'm sure that the same economic factors do not apply to each of our mill designs, but for the sake of emphasis, it is well to review a few of them. They are so simple that we are apt to feel they are not important. Other speakers today are talking about the engineering factors of mill design, but I'm asking the question "Have we checked the economic factors involved in these designs? Have we checked the obvious? Many great discoveries have resulted from analysis of the things that appeared to be obvious all the time. What are some of these economic factors? Perhaps the most basic one is simply the value of minerals in place if minerals have value in the ground, they have value only because many important and different considerations add up to the probability that the minerals can be mined, beneficiated and disposed of profitably. The size formation and quality of the ore body, the distance from market, and the transportation available to the market area, depreciation rates, taxes, and the ownership interests involved are but some of the factors that must dovetail into the answer of profit, an answer prerequisite to hoped-for financing.

Jan 1, 1961

By L. E. Garner

Aggregate resources should be considered primary factors in urban development. Resource planning is essential because land values, previous construction, or zoning restrictions often preempt exploitation of aggregate deposits within an urban area. Sequential land use practices allow development of areas prior to urban development. Population and aggregate consumption trends in Austin, Texas, indicate that substantial quantities of reserves will be lost to future development. Aggregate materials are present in nearby seas. However, a comparison of transportation and reclamation costs indicates that reclaiming land after mineral extraction can be significantly cheaper than transporting materials longer distances.

Jan 1, 1979

By A. E. J. Gallagher

There are many influences which have a bearing on the economics of industrial minerals production. The purpose of this paper is to discuss briefly three factors which have economic significance in the production of these mineral commodities. The three items of discussion include 1) the nature and relative value of the industrial minerals group, 2) project planning, and 3) market analyses. General aspects of these factors are familiar to most of us. However, an attempt will be made to give some current details regarding each. Also, in reality, project planning and market studies are usually so closely associated that they will be discussed jointly, rather than separately. This will be done by way of examples which show how these two activities actually evolved for two industrial minerals projects.

Jan 1, 1984

By N. E. Norman, R. Stier

The mining industry is continually seeking out new and better underground mining techniques. One of the most recent-also, perhaps, the most significant-of the new concepts in underground mining is the use of mechanical rock-boring machines. And one of the problems that concerns us all in this matter is the cost of mechanical rock tunneling. To help answer the oft-quoted question "What will it cost me?" the following pages deal with the operating costs of so-called "medium to medium hard rock" boring machines-i.e., those designed to meet the drilling requirements in 8000 psi to 25,000 psi rock. A few machines are capable of drilling hard rock above 25,000 psi, but the economics of mechanical tunneling in rock that hard is limited at the present time. [ ] For mechanical rock tunneling, there are five main cost factors influencing the expense: Capital Investment, Cutters, Labor, Power Requirements, and Maintenance. These factors give us a good basic picture of the cost of excavation, although muck handling, erecting supports, and other costs directly related to conventional tunneling and mechanical boring enter into the final picture.

Jan 6, 1967

By ed. comp., S. H. White, A. J. Naldrett, P. R. Simpson

Peter Simpson's introduction, Tony Naldrett's concluding remarks and discussion by Prof. White of D.M.A. Flight's report of the proceedings are presented from the conference held in Keyworth, UK, in April 1992

Apr 1, 1995

By Richard M. Chamberlin

Perlite is an altered rhyolitic glass with 2 to 5 wt % water that expands or "pops" when heated quickly to plasticity while evolving steam to form lightweight, glass foam. Commercial perlite deposits in New Mexico are well-developed zones of chemical weathering (hydration) superimposed on highly permeable and thick glassy zones at the chilled upper surface and toes of high-silica-rhyolite lava flows and lava domes. The maximum tonnage of glass in these volcanoes was predetermined by their unique eruptive histories. New Mexico perlite production (80% of US production of 571,00 st) is mostly from the 3.9 Ma high-silica-rhyolite lava flows at the No Agua Peaks volcanic center. The primary vent at No Agua is defined by a 900 ft-high rubidium-rich composite lava dome, known as West Peak, that contains minor perlite reserves. Slightly less rubidium-rich lava squeezed out from under the west flank of the dome to form relatively thin (250 ft) but highly vesicular lobate flows that now consist of about 50 % recoverable perlite. Finally, rubidium-poor lavas were extruded from a radial dike on the northeast flank of the dome. These thicker (400 ft) flow lobes contain about 20 % recoverable perlite. The largest mass of lava does not always contain the most perlite. The thinner (west) flow at No Agua yields the largest perlite reserves rather than the large composite lava dome or thicker (east) flow.

Jan 1, 1994

By Graylin R. K, dea T. R, O&apos

The Wolgan Seam of the Upper Permian IlIawarra Coal Measures of the Western Coalfield of New South Wales consists of high volatile, low sulphur, medium hard coking coal with high fluidity. This seam, 1·8-2·4m thick, in the Wolgan area, dips gently at 1°_20 ENE and lies at 160-440m below the deeply dissected surface of the western margin of the Blue Mountains plateau.A detailed study of the deposit has revealed that the Wolgan Seam consists of four main coal plies separated by three distinct stone bands. Each of these subunits is lenticular and displays individual physical, chemical and mineralogical characteristics which exhibit distinct spatial distribution patterns across the area. Most noticeable is the presence of long linear ESE-trending zones of low ash - high volatiles - high fixed carbon - high fluidity which delineate the major distributary pattern within the deltaic environment of coal formation.This seam contains some of the highest fluidity coal in the world.The Wolgan area, close to the western margin of the Sydney Basin, is characterized by:I. a regional, closely spaced, homogenous joint fracture pattern dominated by an orthogonal pair set trending 3400 and 0700, to which the face- and butt-cleat directions respectively of the Wolgan Seam are sub-parallel, and2. a more widely spaced, heterogenous, cross-cutting pattern of regional structural fractures. Zones of bad roof conditions are probably associated with these lineaments which are subvertical and trend in three majordirections, viz., 005°,035° and 115°.

Jan 1, 1980

By Thomas W. Mitcham

A program of geological research in support of mineral exploration efforts is outlined. Specific goals are stated, approaches to accomplish their attainment are described, and the type of useful results to be expected are outlined. Because mineral exploration or prospecting has intensely practical goals, research in support of it must be applied research, applied to the problem of maintaining or increasing the discovery rate of the exploration effort. To attain research goals, attention to personnel selection, group structure, and program are critically important, and in about that order. A large percentage of the professional personnel should have had experience in mining geology or mineral exploration, and they all should be prospector-oriented. Structuring in the group should be at a minimum, with wide allowance for the kind of independent research which is essential to the nurturing of on-target creativity. The program should be field-oriented, and it should include a wide representation of those subdisciplines of geology which are applicable to mineral exploration. The types of results to be anticipated include improved or new conceptual models for various types of orebodies and their settings from which new ore guides can be derived, new exploration techniques, and the development of a knowledge bank for various aspects of the exploration effort.

Jan 1, 1968

By Brian W. Mackenzie

The paper addresses five questions concerning the economic of gold exploration in the western Canadian shield. Can historical footprints be used to project future gold prices for exploration planning? Experience suggests that gold price forecast are too clo ely tied to current market events to provide meaningful guidelines. What range of breakeven gold price will typically be required to ju tify gold exploration in Canada? Minimum price requirements. initially asses ed at $540 to $1080 per ounce, probably lie in the range of $480 to $760 per ounce (expressed in 1985 Canadian dollar). Within Canada, what role do regional conditions and taxation policies play in determining the viability of prospective gold exploration targets? Striking interprovincial differences are found to exist, given the same geological circum tance -Nova Scotia, ew Brunswick, and Quebec rank towards the top in term of motivating exploration, Briti h Columbia provides the least investment incentive, while Saskatchewan and Manitoba place around the middle of the Canadian league. How can minimum acceptable tonnage-grade conditions for gold targets in the western shield be established and, then, constructively applied to provide exploration planning guidelines? Minimum target conditions, realis tically defined in terms of a broad band of doubt, can be used judiciously to help balance the direct costs of uneconomic exploration with the opportunity costs associated with rejecting economic deposits. How does the average cost per ounce of gold discovered in the western shield compare with the overall Canadian experience? Average discovery costs for the we tern shield, apprai ed at $100 per ounce, are shown to compare favourably with the Canada-wide record.

Jan 1, 1986

By J. C. Agarwal

Do large-scale projects in mining and smelting start up and achieve expected capacity on schedule? In most cases not. Regardless of worldwide location, company know-how, or financial backing, unforeseen delays occur. A comprehensive CRA study for the World Bank shows that delays are the rule, not the exception, in most mining and smelting projects. When delays are not factored into analysis and planning, financial projections are, literally, not to be believed. Returns on investment will seldom achieve their targeted level because of startup delays. This paper reviews the results of our analysis of startup of new mines, mills, and smelters; provides a detailed discussion of why delays occur in the smelters and refineries; presents the cash flow implications of startup delays; and discusses preventive measures that should be taken to avoid financial shortfalls,

Jan 1, 1983

By G. Richard Dreese

Most coal mining states have passed or amended laws restricting strip ruining in the past two years. In light of this and in anticipation of further restrictions by the states and the federal government on strip mining this paper attempts to show the Impact of these new laws on the structure of the coal mining industry in Ohio and specifically on one small stripping firm in Ohio. The implications of the study are applicable to other states under similar circumstances and to other industries which are being caught up in the ecological-economic struggle.

Jan 1, 1973