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"Option pricing is used in finance for valuing options to buy (or sell) shares at some future date because it provides a convenient framework for quantifying values subject to uncertainty. As one of the main sources of uncertainty in mining is the price (sales) of the metal, this approach can also be used for valuing mining projects.The first part of this paper reviews options and option pricing; the second part presents the approach developed by Brennan and Schwartz (1985) for using option pricing to value natural resources. Several applications of this methodology have been published; these are described. From a mining point of view, the assumptions made by Brennan and Schwartz are too simplistic. The weaknesses are discussed with a view to improving an apparently promising new way of assessing the value of projects. IntroductionThe collapse of the British merchant banking group, Barings, has highlighted the risks that can be incurred by speculators and arbitragers in the futures and options markets. But this negative attention on futures and options should not make us forget their positive aspects. They can provide producers and consumers of metals with more predictable sales prices. The introduction of the new traded average price options, TAPOS, by the London Metal Exchange in January 1997 is a response to this need. Equally important, the theory that the finance industry has developed for valuing options provides an interesting framework for valuing mineral projects as well. While this paper was being revised, the South African gold mining house, JCI, announced that it was using a methodology based on option pricing for valuing the mineral rights to deeplevel gold resources (see Box 1)."

Jan 1, 1997

By B. D. H. Knights, N. B. du Preez

The recovery of the economy of the Democratic Republic of Congo has allowed for the rapid increase in production of copper from this region, while the increased price of cobalt continues to support the recovery of that country’s economy. This has enabled the modernization of the process technology used, particularly the change from direct electrowinning of copper to solvent extraction-electrowinning. With this change has come a variety of technical challenges in optimizing the recovery of cobalt from these sources. In this paper, we discuss aspects of the flowsheets for the production of cobalt from the ores of the DRC and Zambia, highlighting the technological improvements that have been made. Following this description of the practice, we assess the challenges of further improving the recovery and purity of cobalt from these sources. INTRODUCTION The African Copperbelt (Figure 1) is by far the biggest producer and holds the greatest reserves of cobalt (Sheed, 2015). However, the ores of this great mining region are extracted primarily for their copper content, and cobalt is a by-product. The ratio of copper-to-cobalt is between 6 and 20 to 1, with the ores from the DRC richer in cobalt than those from Zambia. The overall supply of cobalt, shown in Figure 2, is increasing due to an increase in demand for its use as a battery material. Cobalt is used in superalloys, hard metals, pigments, catalysts magnets, tyre adhesives, lithium-ion rechargeable batteries, and wear-resistant coatings, amongst others. Although these generic categories persist, Figure 3 shows how the relative usage of cobalt is changing due to the uptake of electric vehicles in China and Europe. Cobalt is a key element in lithium-ion batteries, and because it is widely anticipated that electric vehicles will be legislatively encouraged, it is anticipated that the demand for cobalt will rise. This anticipated increase in demand resulted in an increase in the price for cobalt, to which suppliers responded over-eagerly, and the price has dropped dramatically in the first few months of 2019, as shown in Figure 4. However, there is a clear cycle of price peaks in cobalt’s history.

Jan 1, 2019

By E. W. Hawk

The power generation industry may be required to reduce CO, emissions if regulations related to global climate change are enacted. Coal-fired generation, which emits 82% of the power sector CO2, would be a likely target for CO2 reduction. Compliance with the Kyoto protocol will require a 30% reduction from the projected year 2012 emission level even with moderate load growth. This paper describes an analysis of power industry CO2 reduction options and their costs to assess how a generator would make compliance decisions under a mandatory CO2 emissions reduction program. Carbon sequestration, fuel switching and new plant construction are considered.

Jan 1, 1999

By Jr. Hawk

The power generation industry may be required to reduce CO2 emissions if regulations related to global climate change are enacted. Coal-fired generation, which emits 82% of the power sector CO2, would be a likely target for CO2 reduction. Compliance with the Kyoto protocol will require a 30% reduction from the projected year 2012 emission level even with moderate load growth. This paper describes an analysis of power industry CO2 reduction options and their costs to assess how a generator would make compliance decisions under a mandatory CO2 emissions reduction program. Carbon sequestration, fuel switching and new plant construction are considered.

Jan 1, 1999

During the construction of storage caverns, and during their lifetime if the use to which they are put so requires, it is necessary to provide adequate ventilation to ensure the safety and comfort of the underground workforce. An analysis of likely contaminants during construction has indicated that where a large facility is situated in a rock mass of even moderate temperature climatic conditions are likely to be the limiting factor during most of the mining operation and atmospheric pollution when blasting is undertaken. Possible options for improvement are increased air flow, cooling of intake air and reduction of the heat source by altering the number and type of haulage units employed in the cavern. Local solutions are an alternative approach where heat problems are confined to a few specific locations

Aug 1, 1994

By M. A. A. de Klaver

Functional Description Figure 1 is a typical flowsheet for a system for solid fuel addition to filter cake. Solid fuel, coal, coal breeze, or charcoal, is fed from a,stockpile to a surge hopper. The solid fuel is metered into a grinding mill. The fuel is dried and ground in a grinding mill. The on-size particles are removed from the mill by air sweeping. The ground solid fuel is separated from the air stream by a cyclone and stored in a surge hopper. The ground solid fuel is then pneumatically conveyed to a small hopper in the balling area. The fuel is proportioned into the filter cake just prior to mixing. An efficient mixer is very important to have a successful operation. The exact flowsheet would depend on a number of factors including what fuel is used, how the fuel is received, and the cnaracteristics of the fuel as received. Availability of floor space in the plant may also affect the flowsheet. For example, drying air may be supplied from the pellet furnace if the grinding mill can be located near the grate, or the pneumatic conveying system and a surge hopper may be eliminated by placing the grinding mill adjacent .to the mixing area. Also, for a multiple line plant, a ball mill rather than a roller mill may be more suitable.

Jan 1, 1980

By Weller KR

A study of high pressure rolls grinding of a number of Australian ores and minerals has been carried out using a pilot-scale machine with rolls 300 mm diameter and 70 mm wide. The results from this study have been used in conjunction with plant survey data to construct computer simulation models of various comminution circuits and these have been used to investigate options for incorporating high pressure grinding rolls into these comminution circuits. Possible rolls options for three of these circuits are presented, and likely energy savings over the existing circuits are discussed together with potential improvements in plant throughput and/or product sizing. A scale-up procedure for predicting full-scale machine performance from small-scale testing is described, and the effects of rolls operating conditions are also discussed.

Jan 1, 1991

By John R. Goode

"This paper reviews options for the separation of a mixture of rare earth elements (REE) into its component elements. Earlier separations used selective chemistry such as double salt precipitation and reductive/oxidative processes – methods that still have a place in the industry. Fractional crystallization was developed for more complete separations of adjacent REE. The latter method was replaced by ion exchange (IX), which was in turn replaced by solvent extraction (SX). Two main SX chemistries are in use, solvation and cation exchangers, with several variants (mixed solvents, ionic liquids, etc.) now under investigation. SX plant configurations have evolved including advanced techniques like “hyperlinking”, novel saponification methods, and alternative stripping techniques. The classic mixer-settler is the most commonly employed device although centrifugal contactors have been pilot-tested. Non-dispersive SX options including microfluidic devices and membrane-assisted SX techniques are being developed and could revolutionize the SX option. Other REE separation techniques now being studied include Molecular Recognition Technology (MRT), Free Flow Electrophoresis (FFE), newer IX systems, and electrolytic processes. Additionally, the classical crystallization and selective precipitation methods and newer bacteria-mediated processes, chloride volatilization, high performance liquid chromatography, and magnetic separation systems have been studied. This paper reviews the options and concludes that conventional SX is the technology of choice but viable alternatives could be demonstrated and acceptable within a couple of years.INTRODUCTIONThe chemical properties of the individual REE are very similar which is why REE minerals and ore deposits almost invariably contain a mixture of all fifteen REE, i.e., La to Lu plus Y. That said, the distribution of REE in a given deposit is frequently dominated by the light REE (LREE, i.e., La to Nd). Examples include the Bayan Obo, Mianning, Lynas Mt. Weld, and Molycorp Mountain Pass deposits where heavy REE (HREE – Sm to Lu and Y) typically account for well under 5% of the REE content. The LREE operations produce some HREE but the main sources of these important elements are the ionic clay deposits of Southern China. Importantly, all of the REE recovery operations referenced above, except for cerianite-bearing ionic clay deposits, initially produce a mixed REE precipitate or calcine with a REE distribution similar to that in the ore (Goode, 2016). However, the consumers of the REE, the manufacturers of magnets, phosphors, catalysts, optical glass, etc., require separated products with purities generally ranging from 99% to as high as 99.9999% depending on the element in question and the end use. Hence there is a need to separate the individual REE one from the other. This paper is intended to review the options."

Jan 1, 2016

This paper explores options worthy of consideration in the management of S02 produced from the gold roasting operations at Kalgoorlie. Some of the options have relevance to other sources of SO2 in the region, eminating from nickel smelting operations. The paper considers the following options: 1. Capture of SO2 within the roaster where sulphur-containing reaction products are mixed with the calcine. 2. Processes in which the sulphur-containing products are bled separately from the stack for further treatment or for dumping as a waste. These include: Seawater-based scrubbing of SO2; Sulphuric acid manufacture as a feedstock for fertiliser production or for leaching of bauxite; its use as Caro's acid: and the production of value-added sulphur-containing reagents eg liquid S02 and sulphonic acid.

Jan 1, 1992

A detailed study of the capital investment and production cost for copper electrowinning plants shows that significant savings in both can be achieved by increasing the current density. From the economic analysis it is determined that the optimum current density which will result in lowest capital investment and lowest operating cost is between 60 A/sq. ft. and 70 A/sq. ft., or at least three times as high as the Conventionally employed current density. The specific investment, expressed as $/ton-year, is found to be a function of both the current density and plant capacity and has a minimum value at the optimum current density. Empirical equations are developed for the purpose of estimating the capital investment and operating cost for plants of any production capacity operating at any current density.

Jan 1, 1972

By R D. Lama, A Misra

One of the major factors restricting an increase in the productivity of a longwall mine is lower productivity obtained in a development panel. There has been a significant improvement in gate road development, particularly in mines requiring high density roof and rib bolting within 2 m of the face. Advance rates have increased from an average of 3 m to 5 m per shift in 1985 up to an average of 5 m to 10 m per shift in 1991. In mines at shallow depths with reasonably good conditions the increase has not been that significant. Advance rates have increased from an average of 7 m to 12 ni per shift in 1985 to an average of 12 m to 15 m per shift in 1991. Compared to the United States' (US) development rates, these are much lower. Extensive research work has been carried out to minimise cutting, wheeling, support setting time, and to optimise pillar length to achieve maximum advance rates. Pillar optimisation is very important in order to expedite adverse rates. This paper investigates various development rate technologies, both present and future, and optimises pillars to improve these dev elupment rates. Pillar optimisation is based upon time and motion studies conducted at mines in the Illawara region of New' South Wales, Australia, and the basic tools of arithmetic.

Jan 9, 1996

By Marcel Allard

On January 1st, 1977, SIDBEC-NORMINES INC. purchased from Quebec Cartier Mining Company various facilities located at Gagnon and Lac Jeannine together with the Fire Lake deposit. A t the same time, SIDBEC-NORMINES started its mining operations at Fire Lake, 83 km northeast of Gagnon. The paper summarizes the various adjustments which were necessary to satisfy the new production conditions, such as the physical and mechanical properties of the ore at Fire Lake, and the new crushing and loading installations at the mine, together with the transport of some 14 million tons of crude ore to the Lac Jeannine concentrator about 100km away, and finally to achieve satisfactory recovery from the FireLake ore. In addition, mention is made of the manpower organization, in which Quebec Cartier Mining Company plays an important role as manager of operations and owner of the railroad linking the mining operations to the pelletizing operations at Port-Cartier.

Jan 1, 1979

By J. J. Lewis

In the mid-1970's a major new prospect was proved in a previously unworked region of North East Leicester- shire, United Kingdom. Preliminary estimates from borehole information showed over 500 million tonnes of recoverable reserves. A special Planning Team was set up, to co-ordinate the work for the two local Areas, South Nottinghamshire and South Midlands (management of production of the UK National Coal Board is organised in twelve such Areas). The team was led by one of the authors as Deputy Director, Mining, North East Leicestershire Prospect (NELP). The remit imposed by the National Coal Board was to analyse the possible options of number, location and eventual rates of output of shaft or drift access; to select a recommended alternative in the light of geological, mining, topographical and environmental considerations; and prepare submissions in accordance with standard Board practice on major projects - such submissions including detailed engineering design, financial appraisal, and full risk assessment. To assist the Planning Team, surface and underground consult- ant engineers were appointed to prepare feasibility studies of specific civil and engineering problems.

Jan 1, 1979

By Lovitt M

Ora Banda Gold Mine is located in the Eastern Goldfields of Western Australia. Mining is carried out underground by sublevel open sloping resulting in large open stopes. A Mass Blast of approximately 250 000 tonnes was carried out in July 1994 to recover a rib pillar between two stopes, and the crown pillar between the underground mine and the abandoned open pit above. Strategic development within 50 m of the blast consisted of two ventilation shafts and the main decline. This development required careful design and prediction of the blast results. This paper describes the design of the blast, the prediction of the likely effects, the measures taken to reduce the risk to important development, and the results of the blast.

Jan 1, 1995

Orange Free State Branch Minutes of a Committee Meeting held in the Boardroom of Western Holdings on Thursday, IIth October, 1973, at 5.00 p.m. Present Messrs E. T. Wilson (in the Chair), E. Dunstan, W. B. Evans, C. J. Isaac, C. Mostert, N. Shand, R. Williams, and G. Young.

Jan 2, 1974

The annual general meeting of the Branch was held at the St. Helena Club on Thursday, August 21, 1969. Mr J. G. Kirchner (Chairman) was in the Chair. Also present were Mr R. C. J. Goode, President of the S.A. Institute of Mining and Metallurgy; Nine Members: Messrs N. A. Honnet, W. R. Lawrie, J. N. Saunders, D. D. Waterman (Committee Members), M. G. Cullen, G. C. P. Labuschagne, H. A. G. Slater, I. G. Thomas, T. Zadkin and Nine Associate Members: Messrs R. Campbell, D. E. Couperthwaite, T. M. Espach, J. M. Ferguson, G. W. Futcher, A. G. C. Merson, E. R. Penny, R. B. Sutherland, J. W. van den Munckhof and One Visitor: Mr D. J. McLaren. The Chairman declared the meeting open and, on behalf of the Branch, thanked the President for coming from Johannesburg to attend. MINUTES OF THE PREVIOUSGENERALMEETING As the Minutes of the General Meeting held on June 18, 1969 had not yet been published in the Journal, the Chairman moved that their adoption and the discussion thereof be deferred to the next General Meeting. This motion was adopted unanimously. CHAIRMAN'S ANNUAL REPORT 1968/69 At Mr Kirchner's request, Mr. R. C. J. Goode took the Chair during the presentation of the Chairman's Annual Report. (This report was published in the August 1969 issue of the Journal.) OFFICE BEARERS AND COMMITTEE MEMBERS FOR THE YEAR 1969/70 The Chairman announced that the outgoing Committee had elected the following office bearers for the coming year: Chairman: N. A. Honnet; Vice-Chairman: J. N. Saunders; Immediate Past Chairman: J. G. Kirchner. The Chairman then read a letter from the scrutineers reporting that the following had been elected to the Committee: M. S. Grobler, W. R. Lawrie, L. O. W. Leimer, A. T. Lewis, R. S. Pearson, T. Zadkin. The Chairman thanked the scrutineers for their services, and congratulated Messrs Lawrie, Leimer and Zadkin on their re-election and Messrs Grobler, Lewis and Pearson on their election to the Committee. The Chairman announced that he had heard, with regret, that Mr. T. Zadkin would be leaving the O.F.S. at the end of August, 1969. Mr Zadkin had served on the Committee continuously since the inception of the O.F.S. Branch and records showed that he had only failed to attend three General Meetings in over nine years. The Chairman expressed the gratitude of the Branch for Mr Zadkin's invaluable services to the Institute, congratulated him on his well earned promotion and wished him well in his new position. INDUCTION OF CHAIRMAN The Chairman introduced Mr N. A. Honnet to the meeting by briefly outlining his past career and, after congratulating him on his election, called upon him to take the Chair. In congratulating the out-going Chairman on a very successful term of office, Mr Honnet said that due to the absence of many Committee Members for a large portion of the year Mr Kirchner had carried a heavy burden, and he moved a vote of thanks and appreciation for Mr Kirchner's efforts. This was carried unanimously. GENERAL BUSINESS There were no points raised under this heading. MINING AND METALLURGICAL CONGRESS The Chairman called on Mr W. R. Lawrie to give his talk on aspects of the Mining and Metallurgical Congress recently held in Britain. This presentation was illustrated with photographic slides and proved of great interest to Members. Mr D. D. Waterman proposed a vote of thanks to Mr Lawrie and the Chairman then asked Mr R. C. J. Goode to contribute to Mr Lawrie's address. Mr Goode thanked Mr Kirchner for his efforts during his very successful term of office and congratulated the in-coming Chairman and Vice-Chairman on their election. He then gave a brief talk on aspects of the Congress not dealt with in Mr Lawrie's address. These included the industry's requirements of graduates, the necessity of their rapid advancement and the desirability of sending such young men to attend future Congresses. Mr Goode announced that two symposiums will be sponsored by the Institute next year, one on Tunnelling and the other on Open Cast Workings.

By G. Popplewel

Commencing with the Pre-Feasibility Study (PFS) conclusions, the Orapa 3 process design evolved through a phase of value-engineering studies. An overall re-evaluation of the originally proposed process design was necessary both in order to address the interim increase in target throughput from 9.8 Mtpa to 12 Mtpa as well as to increase capital efficiency. In the interests of clarity, the PFS process design for Orapa 3 has been omitted from this paper, as it is no longer relevant. Recognition is however due to those engaged in earlier phases of the Orapa 3 project with respect to fundamental mass-balancing modelling; and ore and diamond characterization, which fanned the basis for the process design that has evolved from feasibility study activities.

Jan 1, 2010

By Lawrence Adler

The properties of a geologic mass may be considered from a resource or an engineering viewpoint. The primary engineering applications include ground control, excavation, bulk handling, and hydrology. This study will focus upon these areas in descending order. For an adequate geologic description, data is necessary on the following components: (1) the intact rock, (2) geologic structures, (3) contained fluids, and (4) existing pressures and temperatures, see Table 1. This information, combined with the engineering specifications, provides the basis for a formal geotechnical analysis as illustrated in Figure 1. For a structural analysis it is essential to establish the mechanical properties of the material composing the structure. This material, termed the "rock mass," consists mainly of the first two geologic components, the intact rock and geologic structures (Figure 1) Consideration of fluids will be subordinated to their role as chemical agents affecting the mechanical properties. The existence of pressures and temperatures generally lies beyond the scope of this study.

Jan 1, 1973

By George C. Gibbons

ALMOST everyone in any of the five counties embracing the great East Texas field depends heavily upon oil for his living whether or not he actually owns a well or piece of royalty himself. Oil is a natural resource that, when utilized, spreads its benefits over a vast area and into many channels. Depending then almost entirely upon agriculture: what is now known as the East Texas oil field a decade ago had a scattered farming population. For many of its people, tomatoes and other vegetable crops coupled with the old southern stand-by of cotton, furnished an adequate living and a small cash surplus. Some farm families on the red hills, however, were not far re- moved from the sowbelly and black- eyed peas, or cornpone and potlikker, standard of living. Kilgore of that day, was a village of less than 850 per- sons. Longview, with just over 5000, apparently had reached the limit of its growth. Tyler was an overgrown farming town of around 17,000 persons, de- pending largely upon the agricultural income of Smith County and surrounding territory for which it was a trading center.

Jan 1, 1941

By M Morey

Ok Tedi Mine is located eighteen kilometers from the Irian Jaya border in the Star Mountains, Western Province, Papua New Guinea. Sequential flotation concentrators produce a copper / gold concentrate for market, and a pyrite concentrate for environmental containment, with low sulphur tailings from the pyrite flotation sequence being discharged to river. Strict sulphur assay targets are set for the riverine discharge. Current porphyry and skarn ore blends from open pit operations at Mt. Fubilan will cease by 2017. However, drill cores indicate an economic ore body in the skarn ores surrounding and below the current pit limits. With proposed mining from a western pit wall ‘cut back’ and an eastern pit wall underground operation, potential for ore ageing in sub level cave underground stockpiles is apparent. With little information in the literature, Ore Ageing test work at prefeasibility level consisted of multiple one tonne stockpiles of -50 mm crushed rock. For the bankable feasibility study, a successful test work program was implemented utilizing 40 tonne ROM ore stockpiles composed of exposed pit extensions of future ores. Realistic ageing profiles of Skarn ores were obtained from one tonne monthly samples subjected to laboratory testing. Test work outcomes included:• Similar ore ageing profiles from both the pre feasibility study (PFS) and feasibility study (FS) programs, suggesting ore susceptibility to oxidation has greater effect in ore ageing than rock size for Ok Tedi skarns. • Laboratory rougher flotation of pyrite showed significant variation in sulphur recovery rate, suggesting three classes of pyrite floatability.• Laboratory rougher flotation of both copper and pyrite for up to 19 months ore ageing from 11 stockpiles, suggested three stages in the ore ageing process.

Aug 8, 2011