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Mining projects draw together stakeholders with various degrees of experience in managing and assessing financial risk. When this risk is not fully appreciated or quantified, the potential for making decisions not suited to investor requirements is significantly increased. A feasibility study provides key information on project development potential, requiring detailed technical investigations with thorough financial analysis. Centaur Mining and Exploration (CME) owned and operated Cawse Nickel Operations (CNO), one of three Australian projects to develop and process vast amounts of near surface nickel resources. A technical ædue-diligenceÆ and æbankable feasibility studyÆ confirmed the large resource base, newly applied yet tested technology and relatively low unit costs would produce nickel in the lower half of industry operating costs. A number of production variables including capital requirements, delayed start-up, nickel grade, processing, maintenance and product output were outside the feasibility estimate. This was combined with exchange rate fluctuations and lower Ni prices. The inability to generate adequate cash flow and service debt repayments ultimately led to receivership and liquidation of all assets. Following the sale of CentaurÆs gold and nickel divisions, $A 784 million remained outstanding to creditors. This paper aims to define key issues leading to CNOÆs collapse by reviewing feasibility parameters, valuation methodology and project development. Some methods of assessing project viability are discussed with the aim of increasing stakeholder risk awareness.

Jan 1, 2003

I must tell you at the outset that I come to this conference deeply disturbed at the `role of Government in international dealings in mineral and energy resources'. I am disturbed by the confusion that now passes for policy. I am disturbed by the short- range view of critical problems taken by a majority of Governments. I am equally disturbed by the even shorter range of view taken by a growing army of industries. Many of them clamour for Governments to solve their problems in a specific way, with little regard for any other sector but their own-and with even less regard for the fact that every time a Government takes over some of their responsibilities they surrender some of their freedom. I would not say that longer range views don't exist. But I would say that they don't prevail at the present time. Instead, we are seeing the con- stant development of many policies for individual problems which don't tackle the fundamental causes. We must get back to basics without delay.

Jan 1, 1978

The concept of "profit" is implicit in the definition of an ore reserve. It is suggested that the flexible concept "economic" is more appropriate. This allows different economic considerations to be taken to account when determining what is ore at the feasibility study stage; during actual mining production; before mine closure; and from the viewpoint of the national economy. Economic factors which are highly variable, and largely beyond a mining enterprise's control, affect the economic exploitation of a mineral resource. Major economic factors include: metal prices; operating costs; the cost of original and replacement capital equipment; the cost of capital; taxation and royalties; inflation; exchange rates and the state of the world economy. The paper suggests why a careful quantification of the average value, trend, and variation from the trend of major economic factors should be made and how this will lead to a better definition of ore reserves. The paper also discusses the necessity of reappraising economic factors during the life of a mine in order to maximise the economic surplus and to minimise the wastage of natural, economic and human resources employed in mining.

Jan 1, 1979

By R Willis, D Cooke, G J. Davidson

Mine-groundwater interaction at the Pasminco Rosebery Mine (PRM), western Tasmania, deserves special attention due to the unique climate and mining environment present. High rainfall and low evapotranspiration result in an excess of water, an uncommon problem at Australian sulfide bearing mines. Research is being undertaken to delineate current subsurface fluid flows and predict future fluid flows in order to improve management after mine closure. Acid mine drainage generation is well developed in abandoned mines throughout the area. If acid mine drainage is not controlled after mine closure, significant environmental degradation could occur in the receiving waters of the Pieman River system. The study area encompasses the heavily forested Mount Black, and underlying PRM workings. Groundwater flows beneath Mount Black through a crystalline fractured rock aquifer with faults and underground mine workings observed to act as the major hydraulic conduits. Recharge is controlled by local precipitation, and the ultimate discharge is thought to be the Pieman River system, which forms the topographic low in the area. Slug tests have been used in conjunction with the mineÆs extensive geotechnical database to spatially evaluate variation in hydraulic conductivity. In fractured rock terrain associated with mining, rock quality designation data can be a useful tool in delineating areas of similar hydraulic conductivity when combined with conventional hydrogeological methods. A GIS, mine planning software, an environmental and a geological database are linked to form the input for groundwater modelling.

Jan 1, 2003

By J P. R de Villiers

The Vanderbijl Park sinter plant in South Africa was investigated to determine the reason for the production of very fine sinter not acceptable as feedstock for the blast furnace. A procedure was designed to generate representative samples and to prepare the samples for chemical and mineralogical analyses. Results from a mineral analyser showed that the samples are extremely heterogeneous and therefore the sampling and sample preparation methods had to be tested in order to produce representative samples. The high production capacity at the sinter plant could also give rise to sampling errors. The method designed involved sampling of the conveyor belt at the sinter plant every four hours for the duration of three days. The samples were then milled and split into smaller sections appropriate for analysis. X-Ray diffraction (XRD) and X-Ray fluorescence (XRF) analyses were conducted on the samples. The results showed a standard deviation of less then one per cent, which indicates that the samples were representative and that the method used was therefore adequate. Systematic differences in the phase proportions between normal and fine sinter samples were detected, with the fine sinter containing more haematite than the normal sinter. The sampling method employed gives added confidence that the differences are real.

Jan 1, 2008

By Khosrowshahi S

The objectives of grade control remain unchanged but new methods are being developed to attain them. Since the early-1990s, an improvement in the power of mine site computers has made the geostatistical tools of conditional simulation more accessible. Optimisation of the grade control process on mine sites now involves two stages: optimisation of the sampling regime and optimisation of the interpretation of ore and waste boundaries. Optimisation of the sampling regime first requires an understanding of the nature of the mineralisation and in particular the impact of particle size on the sampling precision. This relationship, termed the Fundamental Error of sampling, enables an optimum subsampling protocol to be defined for the sample preparation and assaying. However, the actual sample collection method, whether drilling or trenching, must be correctly selected and the sampling grid should be optimised. The relative costs and benefits of various alternative sampling methods and grids can be determined using the method discussed. The use of the grade control data can also be optimised. In the past ore and waste boundaries were often defined using a linear interpolation algorithm that smoothed the data (such as polygonal, sectional, inverse distance squared or even kriging methods). Frequently the relative impact of ore loss and dilution could not be estimated. Conditional simulation to generate equiprobable alternative maps (realisations) can now be adopted to address these issues. A transfer function is then used to evaluate the similarities and differences between the maps. The Ore Block Optimisation (OBO¬) process is a transfer function that produces a three-dimensional model of the optimal ore block outlines. This provides a clear guide for the mining geologist to refine and mine. The nature of the transfer function and the inputs and outputs are discussed. In the past, reconciliation has been the `acid test' for any grade control system. Any ore blocking method based on conditional simulation can make use of the exhaustive data set to ensure that reconciliation between prediction and production will improve significantly. The OBO¬ method provides a guide to the mining geologist to ensure that the best ore blocks are mined. Misclassification between ore and waste is reduced, ore loss and dilution are minimised (and are measurable) and ore is optimally assigned to stockpiles of various cut-off grades. These advantages significantly enhance mine profitability and control of the mined grade.

Jan 1, 1997

Developing and operating mines in developing countries is never dull, but continuously challenging in terms of geology and terrain, geography and location, culture and land tenure, environmental and social issues, fiscal regimes and in some cases political risk. In addition, the rapidly changing nature of the communities with little understanding of the nature of mining at the community level requires us to continually manage issues affecting project development and mine operations with greater sensitivity. In frontier regions, people skills can become more essential than technical skills, particularly in dealing with indigenous people. Hence, managing a mining project requires a huge relationship effort.Effective communication with communities of different cultural background and proactive management of issues influencing community aspirations and desires requires not only new skills but also creativity with new concepts on how to deal with social issues under a different cultural context. The involvement of government agencies and NGOs is an important ingredient to creating understanding and collaborative approaches to common social issues. Maintaining stakeholder relationships pays in the long-run and is a useful exercise in getting information feedback from the wider community.

Jan 1, 1997

Of the energy resources present in Australia, coal and uranium are by far the largest. These two resources ap- pear sufficient to satisfy Australia's energy needs beyond the immediately foreseeable future and long after the natural petroleum resources are exhausted or have ceased to play a significant role. By that time, coal could be converted in plants of very large size to synthetic liquid and gaseous fuels which will be used as substitutes for pet- roleum fuels, particularly for transport. The basic role of uranium will be to supply electricity from nuclear power stations for heat and power requirements, thereby freeing non-coking coal largely for conversion purposes. The establishment of these enterprises will require a massive national effort and a high degree of co-ordination at the planning stage.

Jan 1, 1975

By Hughson B

The need to prevent the sterilisation of coal stems directly from the fact that it is a non-renewable resource. In N.S.W. a vast amount of coal resource is located under major public utilities such as freeways, railways, stored waters, pipelines carrying gas, water and sewage, and transmission lines. Total extraction has occurred under freeways, transmission lines and pipelines with little or no damage. Where damage has resulted, the cost of restoration was only a small fraction of the value of the coal recovered. However, coal at present is being sterilised and perhaps lost for ever under stored waters and railways. If engineering solutions are available for mining under these improvements economically and with maximum safety, then coal should be extracted and utilised to the benefit of the State.

Jan 1, 1986

A Presidential Commission of Enquiry into the conservation of South Africa's coal resources was appointed in 1970. This Commission, in co-operation with the Chamber of Mines of South Africa, established a national inventory of South Africa's in situ and extractable resources and reserves of coal of various types and grades by several mining methods. South Africa's future demand for coal by all market sectors and the specifications of coal required, were also established by means of econometric models. A comparison of potential supply and anticipated demand indicated serious defi- ciencies of certain types of coal and the need for the conservation of others. This paper describes recommendations for alternate strategies for the optimum utilization of available resources. Con- sideration was given to various policies relating to pricing, exports, taxation and incentives, and to the possibility of the substitution of higher grades of coal by lower grades. The steps so far taken to develop a national coal policy in South Africa are described.

Jan 1, 1977

The basic principles of mineral valuation were recognised and propounded at the beginning of this century and have remained virtually unchanged since then. Valuation is seen as a two part process commencing with a technical examination of the mineral property followed by a manipulation of the results of the technical examination in order to determine the monetary value of the project. A thorough and competent technical examination was seen then and remains now as the essential but not sufficient foundation for reliable valuation. All authors stressed the need to maintain the integrity of the data base and to ensure adequate coverage of all relevant aspects. The monetary valuation process through most of the first half of this century was mainly based on the Hoskold two rate method, derived from the formulae for valuing annuities but modified to provide explicitly for recovery of capital. Though the basic principles of valuation have not changed significantly, the means of implementing the components of the technical examination, the styles of deposits being evaluated and the mechanisms of monetary valuation have changed dramatically. Despite all the technological improvements, however, mineral

Jan 1, 1995

It's my privilege to welcome you here this afternoon on behalf of the Sydney Branch of the Australasian Institute of Mining and Metallurgy. This is a most important gathering. You, the delegates, represent what is probably the most influential cross-section of the mining investment community and the oil and gas investment community to meet as a group during the last decade. We are meeting today and tomorrow to review two related issues that will have far reaching implications for the effective use of capital by the natural resources sector in the 1990's. The views which will emerge over the two days will almost certainly 'influence the availability of new capital to the companies in the natural resources sector for the decade ahead. The two principal themes of Minval '89 are, first, the valuation of mining and oil and gas assets and securities, and second, disclosure and reporting requirements in the capital markets which relate specifically to natural resources companies. This conference is taking place at a time when further consolidation and rationalisation appears likely within the mining industry. Although the base metals and other sectors of the industry are enjoying profitability not seen since the early 1980's there is caution about committing to new capacity which could bring about a return to the low prices and excess supply which prevailed during much of the last ten years. These conditions have led to increased takeover activity within the mining industry overseas, and similar trends are as evident here in Australia as they are elsewhere. Recognition of value is therefore likely to become more important than ever before in preserving shareholder wealth, for creating new wealth and for preserving the financial health of the resources industry in the future. Valuation therefore is the first theme of the conference.

Jan 1, 1989

By T Hausler

The pitfalls, pleasures and management issues associated with international and remote projects are diverse.However, no problem is insurmountable and if an engineering team chooses (by luck or good planning) to push through the difficulties, success can mean an extremely satisfying experience for individuals and a significant, positive result for an organisation.International projects are not for the faint hearted or inflexible. Working in foreign lands with people who may or may not speak English and who may not initially respect you can become mentally and physically tiring.Sometimes the challenges are not fully explained to individuals in advance. Individuals then often learn about the challenges ù and discover solutions ù on the job. While this initially puts great pressure on individuals, matters improve eventually, especially when the locals come to understand that you are on site to make a positive difference.This paper will discuss aspects of a recent international project including meeting international clientsÆ expectations, dealing with cultural differences, social reckoning, environmental issues, and personal challenges. Specifically, it will cover aspects of working within a Russian cultural setting and overcoming social barriers.The paper also presents coping strategies for long periods of time spent away from home in remote places with extremes in weather beyond the normal experience of most Australians. For example, dealing with the effects of the spring thaw and coping with temperature ranges of -45 to +45¦C.Lastly, and possibly most importantly, there will be a focus on the role of translators. They have the power to make an engineer everyoneÆs best friend or, on your behalf, to order cold chicken liver and heart salad for lunch. If an engineering team can establish a working relationship with translators, they can become an invaluable asset and both on and off site.CITATION:Hausler, T, 2013. Achieving success in large-scale, remote area metallurgical plant projects, in Proceedings MetPlant 2013 , pp 539-552 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 15, 2013

One of the major changes in the resource industry in the nineties has been the re-internationalisation of the industry. The history of the resource business has been one of companies from the developed world utilising the cash flows from their operations to explore and develop mines in less developed regions of the world. This resource development has progressively generated wealth and economic development, which in turn, has led to a new generation of exploration and mining projects. In South America, Chile had led the way in a mining resurgence, now closely followed by Argentina, Brazil, Venezuela and Peru. Although Chile has long had a significant copper mining industry, the pre-nationalisation phase was driven by American capital; the current phase has been spearheaded by R.T.Z. - B.H.P. at Escondida with Canadian junior companies, in particular, providing major speculative impetus. The Australian junior companies have not been significant in South America.

Jan 1, 1995

A method of assessing the blastability of a rock mass is presented which makes use of five, readily available, simple parameters. These are the Rock Mass Description, Joint Plane Spacing, Joint Plane Orientation, Specific Gravity Influence and Hardness. For a particular rock mass a value is assigned to each parameter and the Blastability Index is calculated from these values. Application of the Index in blast planning and computer modelling is discussed.

Jan 1, 1986

By K S. Smith, B P. Jackson, P J. Lamothe

The upper Arkansas River south of Leadville, Colorado, USA, contains deposits of fluvial tailings from historical mining operations in the Leadville area. These deposits are possible non-point sources of acid and metal contamination to surface- and ground-water systems. We used stable-metal isotopes to help ascertain metal retention and release mechanisms that influence metal transport from the deposits to shallow ground-water systems. To accomplish this, we excavated an intact core from a small fluvial tailings deposit and performed laboratory column experiments to examine the amount of metals leaching through the core. Deionised water was continuously applied to the top of the core, and effluent was collected from the bottom of the core for a period of about two months. Three saturation conditions were used, including unsaturated, partially saturated, and fully saturated. Reducing conditions developed upon partial and complete saturation of the core. During the unsaturated leaching phase, core effluents were acidic (pH 2.8 - 3.5) and contained elevated metal concentrations. During a portion of the unsaturated leaching phase, stable-metal isotope spikes and conservative tracers were simultaneously applied to the top of the core. The isotopes provide a means to delineate metal behaviour within the core. During the unsaturated leaching phase, the isotope spikes did not exhibit breakthrough with simultaneously added conservative tracers. However, some of the stable-metal isotope spikes did break through when reducing conditions occurred in the core (during the partial- and completesaturation conditions). In this paper, we use Cd as an example of the utility of stable-metal isotopes in geochemical studies. In the case of Cd, after the core was partially saturated, the 111Cd spike was released as evidenced by a change in the Cd isotope ratios in the effluent. This release continued during the fully saturated leaching phase, however, the total Cd concentration did not increase. These results suggest that the 111Cd spike was retained inside the core during the unsaturated leaching phase, and only partially released as reducing conditions developed. Results from this core-leaching experiment indicate there is a large reservoir of water-soluble material within the fluvial tailings deposit, which yields elevated metal concentrations and high acidity, and which may degrade adjacent ground- and surface-water quality. Use of stable metal isotopes in this study facilitated the determination of different metal-retention processes, metal-release processes, and metal sources in the fluvial tailings deposit in response to changing geochemical conditions.

Jan 1, 2003

By Johnson G. D

Confidence in Yakabindie becoming a truly cost competitive nickel project has risen recently because of: ò the emergence of an economically effective contract mining climate; ò the delivery of cheaper energy via the Goldfields Gas Pipeline; and ò the development of the Yakabindie Process for production of nickel cathode and cobalt by-product directly from sulphide concentrates at site, dramatically cutting capital and operating costs compared to the conventional route. Development of the Yakabindie Process was a result of 'necessity being the mother of invention'. Yakabindie can now break out of the trap of relying on existing downstream processors to treat an intermediate, and instead the project can gain direct market access. The very attractive cost advantages demonstrate that hydrometallurgical processing of sulphide concentrates is a worthy prize. Improved cobalt recoveries, and tolerance of higher levels of magnesium and arsenic than allowable by smelters, are further advantages of this approach. Leach residues are combined with much larger quantities of naturally alkaline flotation tailings and remain at site. As a result the process is more environmentally sensitive than the conventional smelt/refine route, with no sulphur dioxide gas emissions and 'metal only out the gate'.

Jan 1, 1996

The drilling and evaluation of bore cores provides the best available statistical basis for characterizing a coal prospect. Important, long-term decisions by management frequently must be based on the results. The majority of coal mined presently is used for steam raising or the production of metallurgical coke. Common bore core tests and analyses appropriate to this usage can be cate- gorized as non-destructive, chemical, physical, petrographic, caking/plastometric and propert- ies of non-coal material. The major tests within each category are described. Certain specific information from the bore cores is required by the coal geologist, mining engineer, coal preparation engineer and the user, either individually or as a group. The optimal bore core evaluation test pro- gramme is the one which satisfies the needs of all the professional disciplines with the grtatest speed and at minimal cost. The principal steps in such a programme are listed. There is an urgent need for a bold new Australian standard to provide the necessary guidelines to an industry which at present lacks uniformity in its approach to the task.

Jan 1, 1977

The Prospero orebody is a part of the Helene mine at Cosmos and was scheduled to begin production in March 2008 after the exhaustion of the Tapinos orebody in the same mine. Treatment of the Tapinos orebody was challenging and it was envisaged that Prospero would have similar properties given that it was also anomalous in deleterious elements and would be of a similar mineral hosting. It was deemed necessary to undertake a metallurgical test work program to identify any potential processing issues, complex mineralogy or significant metallurgical domains. The paper discusses the processes which were employed to undertake the metallurgical test work program and describes the aspects that can be employed by other developers to quickly and effectively assess potential future orebodies. It will demonstrate that the work was successful at determining expected metallurgical behaviour, providing direction for mining operations and highlighting areas for more extensive research.

Jan 1, 2009

By Walsh V

The Australian economy has been adversely affected by the hesitation in developing countries to commit to the construction of .new coal-fired power stations. World coal trade which was expected to grow at an appreciable rate has stagnated, world export coal prices have plummetted, and facilities in place in Australia for the production and export of coal are being underutilized. While in some countries this hesitation has been caused by a reduction in electricity load growth, another cause has been the unduly long lead-time imposed on developing countries by the conventional "Banker's Approach" to the planning and initiation of commitments to finance and construct coal-fired power plants. In some countries electricity growth has been met by increased usage of indigenous energy resources, even though this involves costs in excess of imported coal-fired power generation. The avoidance of foreign exchange commitments in these cases can however be desirable. In many other developing countries however, fuel oil continues to be used for power generation at a cost in foreign exchange of up to 50% above the total cost of coal fuel plus capital to construct a new coal-fired power station. The conventional "Bankers Approach" to new power station planning imposes the need for successive feasibility studies to satisfy the normal processes of international development lending agencies. No feasibility study can however, show how keen vendor countries may be to win major power plant contracts; and no feasibility study can determine whether the power station eventually procured will be one of the more reliable, at better than 80% availability, or one of the more unreliable at worse than 60% Availability.

Jan 1, 1987