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By Z. Y. Liu

A local additional potential model (LAPM) was developed to illustrate the role of strain rate in stress corrosion cracking (SCC) of pipelines. According to LAPM, both density and mobility of the local active spots on the steel surface, i.e., dislocation emergence points, increase linearly with strain rate. Generation of such active spots introduces an additional negative potential locally, affecting the electrochemical reaction and, consequently, the susceptibility of the steel to SCC. Electrochemical corrosion measurements, slow strain rate tests and electrochemical hydrogen permeation test were combined to demonstrate the validity of LAPM to illustrate pipeline SCC in an acidic soil solution. It is found that a maximum of the SCC susceptibility occurs at strain rate of 10-6 s1, which is associated with an enhanced hydrogen evolution due to the local additional potential (LAP) effect.

Jan 1, 2010

By C. A. Pickles, K. Mackowiak, D. Gajonera

"Shake-flask oxidation tests were performed on Red Dog mine waste to study the initial dissolution behaviours of lead, zinc, and iron. The conditions for accelerated acid generation in terms of Eh and pH were determined. Each mineral behaved distinctly, with galena dissolving first, followed by sphalerite, then pyrite, although there was some overlap in behaviour. Iron was not detected in solution until approximately day 40 and was present at low concentrations. The experimental conditions and the theoretical model results indicated the formation of iron oxyhydroxides at low weathering times and jarosite at longer times.RÉSUMÉ Des tests d’oxydation par agitation en flacon ont été effectués sur les déchets miniers de l’exploitation Red Dog afin d’étudier les comportements initiaux de dissolution du plomb, du zinc et du fer. Les conditions entraînant la production accélérée d’acide en termes d’eH (potentiel d’oxydoréduction) et de pH (potentiel d’hydrogène) ont été déterminées. Chaque minerai se comportait différemment ; la galène a été la première à se dissoudre, suivie de la sphalérite, puis de la pyrite, mais un certain chevauchement des comportements a été observé. La présence de fer en solution n’a été détectée qu’après environ 40 jours et ce, à de faibles concentrations. Les conditions expérimentales et les résultats du modèle théorique signalaient la formation d’oxyde-hydroxyde de fer sur de courtes périodes d’altération atmosphérique, et de jarosite sur des périodes plus longues."

Jan 1, 2017

By B. Holaday, H. McLaughlin

Orano Canada Inc. (Orano) operates the McClean Lake mill, located in the Athabasca Basin region of northern Saskatchewan. It processes high concentration uranium ore, delivered in slurry form from the Cameco Corporation operated Cigar Lake mine. After the ore slurry is leached at the McClean Lake mill, the leach residue solids are washed in a process known as counter-current decantation (CCD). This process uses six thickeners to facilitate counter-current washing of solids with diluted acid, flocculation and settling, as well as pumping the washed leach residue to the tailings neutralization circuit (TN), and the uranium laden aqueous to the solvent extraction circuit (SX). Challenges in settling the slurry in CCD started in early 2017. This is largely due to the variation in fines content of the slurry (D80≤75μm), and clay content. There are several changes that have allowed the mill to adapt to the evolving challenges of settling leached Cigar Lake leach residue. Flocculant selection and mixing, temperature effects, bed level management philosophy, and centre-well feed density are key parameters that have been explored as part of adapting to changes in Cigar Lake ore quality.

Jan 1, 2020

By Leiting Yue, Peng Ren, Yu Shen, Zhihong Liu, Haibao Shao, Longgong Xia, Feng Yu

The Kennecott-Outotec Flash Converting technology has been proven as an advanced and mature process in 5 individual plants during the past 2 decades. High grade copper matte (65–72%) produced in the flash smelting, or other smelting technologies is granulated to 3-5mm granules in a water torrent, and further crushed to fine powder (≈50µm) and dried to contain less than 0.3% H2O. Oxygen enriched air, together with fine copper matte powder and lime flux are injected into the reaction shaft by a matte burner. The copper making and slag making reactions will happen in very short time and distance during the particle falling and settling. However, industrial practice has found negative effects caused by sodium contamination. Na is introduced in the copper matte granulating process, and appears as Na2SO4 on particle surface. When Na content was high, scaling problems in the boiler will be worse, and the processing air will be blocked by the growing accretion around the matte burner, and as-produced blister copper is always high in S and O. In this present study, an industrial matte sample was used in the experimental work. Na was introduced into the matte powder by Na2SO4 solution soaking. The burning behaviour of the doped copper matte powder has been investigated as a function of the impurity concentration and processing temperature. Morphology and composition of these samples explained how Na2SO4 converts and reacts in the oxidizing atmosphere, and how they or their converting species influence the burning behaviour of matte particles. Cross-sections of as-prepared samples were analyzed with SEM-EDS, and the reaction mechanism has been carefully interpreted. Results from the present study can benefit both academic and industrial people. INTRODUCTION "Flash Converting" technology was developed jointly by Kennecott Utah Copper Smelter and Outotec (Finland) OY in 1992. The first industrialization of the technology was in Utah Smelter in 1995. Since 2006, it has been successfully applied in Xiangguang Copper, Tongling Jinguan Copper Branch, Fangchengang Jinchuan Copper, and Ningde Southeast Copper. The technology has also been further developed in those smelters. At present, roughly 2 million tons blister copper is produced annually through the Kennecott-Outotec Flash Converting technology, accounting for more than 10% of global primary copper production. The technology has advantages of high efficiency, high sulfur capture rate, good in environmental issues, mature equipment supporting, high automatic control level, low comprehensive energy consumption and flexible connection with the smelting unit, which make the technology to be one of the best choices in investing a new large-scale copper smelter or updating an old copper project in the world.

Jan 1, 2019

By Paul G. Dunn

The planning of underground mines is a complicated process involving geological, engineering and operational constraints. MIRARCO is in the process of developing a 5D Mining Exploratorium where 3D mining models are combined with time (4th dimension) and costs (5th dimension). The mining exploratorium is a collection of external and inhouse software packages specifically geared to help underground mining companies arrive at better mine plans. This paper discusses the progress made in the development of the 5D Mining Exploratorium and a change in mine planning philosophy by conducting frequent audits in a Virtual Reality Laboratory. The development of genetic algorithms for optimising stope sequences is also presented.

May 1, 2003

By Troy Boisjoli, Sean Hillacre, Matt Batty

Discovered in 2014, the Arrow Uranium Deposit has undergone rapid development through successive drilling programs informed by geostatistical drill hole spacing studies. An independent third-party geostatistical drill hole spacing study was completed by Clayton V. Deutsch Consultants Inc. in 2017, evaluating the uncertainty of thickness, grade, density, and areal limit of the Arrow Deposit to determine a drill hole spacing suitable for Indicated Mineral Resources. Indicated spacing was defined to be 24 to 32 metres (“m”) to be within 15% of predicted for a nominal quarterly production volume with a probabilistic tolerance between 75 and 90%. The study not only defined the Indicated Mineral Resource resultant from the 2016 drill program, but also provided drill hole targeting criteria for subsequent drill programs aiming to convert Inferred to Indicated Mineral Resources. A subsequent geostatistical drill hole spacing study on the Arrow Deposit was completed by Clayton V. Deutsch with Resource Modeling Solutions in December 2018 to define Measured Mineral Resource spacing in support of the 2019 drill campaign. The study resulted in a drill hole spacing of 9 to 17 m to be within 15% of predicted for monthly and quarterly production volumes using an accepted industry probabilistic tolerance of 90%.

Jan 1, 2020

By F. A. Forward

"NINETEEN sixty-six is a year of unusual significance in our Institute and in our country. It marks two-thirds of a century of service by the Institute to the people of the mineral industry and two-thirds of the century that Sir Wilfred Laurier said ""belongs to Canada."" As we meet here today within the historic walls of Canada's oldest city, a city that looks back on three hundred and fifty years of progress, I am reminded that it is almost a third of a century ago -in April, 1934 -that here in Quebec I first attended an Annual General Meeting of the Institute. It occurred to me that it might be appropriate to examine briefly the change that the middle third of this century has brought in the affairs of the mineral industry and, with some trepidation, to consider the prospect for the third that lies ahead.Opinions differ as to the relative importance of factors that have been responsible for the expansion and growth of Canada in its first hundred years. Some will say that it has been due to the abundance and fertility of agricultural land, others to the early enterprise of the railroads, and financiers believe that the banking system has been a major factor; -the fisherman -the forester -the teacher -each has his own view. I suspect, however, that most of us here would subscribe to the thesis of T. A. Rickard -miner, author, imperialist -who wrote, a gene-ration ago, ""Trade follows the flag, but the flag follows the pick,"" and thus agree that the finest contribution to progress, to wealth, to extension of frontiers and to inter-national trade has been provided by the mineral industry."

Jan 1, 1966

By W. A. Parks

Stone that may be applied to purposes of construction is available in nearly all the inhabited parts of Canada, the most important exception being the prairie region, but, even here, the deficiency is overcome in many parts by a wealth of glacial field-stones. In many parts of the country, also, the accessible stone is of a quality so poor that brick is more generally used. There is a great difference, however, between stone that 'may be used' and stone suitable for buildings of a monumental type or even for 'trimmings' on the better class of dwelling in the cities and towns. It is in the latter sense that the expression 'building stone' is commonly used. Thus restricted the term includes varieties of sandstone, limestone, and granite, using the latter word in the custom of the quarryman, not only for the true granite of the geologist but for many other igneous rocks as well. Building stone of high quality grades imperceptibly into stone suitable for monuments, particularly in the case of the granites. The present review will deal with building and monumental stone in this restricted sense and will omit marble, although that material has been used to some extent for building. For instance, the Great West block in Winnipeg is built of marble from British Columbia.

Jan 1, 1925

By F. Hosseini

Shaping of metals by thixoforming relies on the unusual flow behavior of semisolid slurries containing nondendritic solid phase. The Flow behavior of metallic alloys containing both solid and liquid phases is investigated in the low solid fraction range (, 55%). This behavior depends on both the solid fraction and the shear rate. Four different shear rates is applied using back extrusion technique and flow stress versus true strain in different solid fraction is compared. It is well accepted that the flow stress s of alloys in their semi-solid state obeys to a thixotropic behavior, due to agglomeration and dissagglomeration phenomena during forming. The load-displacement curves produced from the tests may show an initial peak, believed to originate from a skeletal structure which rapidly breaks down under shear. Apparent viscosity obtained from this method is compared with other works and the proper power law of pseudo plastic state is introduced.

Oct 1, 2011

By S. Kelebek

Efficient separation of minerals is the essence of mineral processing. Separation of hexagonal pyrrhotite in processing of Ni-Cu sulphide ores was investigated together with particle size effects with respect to selective flotation recovery of pentlandite and nickel. The recovery by size response was compared for sodium metabisulphite (SMBS), triethylenetetramine (TETA) and their combinations with amyl xanthate as a collector. The pyrrhotite recovery for all sizes was lower than that of pentlandite for the blank case as well as individual cases with SMBS and TETA. For pyrrhotite, the recovery by size relations in the case of individual uses of reagents were mainly determined by recovery losses at coarser size range (>74 um), which occurs at a coarser size for pentlandite (>212 um). The combined use of SMBS and TETA, and the associated synergistic effect very significantly knocked down the pyrrhotite recovery to less than 7% that was a maximum for the –10 um (attributable to hydraulic entrainment). High recovery of pentlandite in a wide range of intermediate sizes and drastically low recovery of pyrrhotite resulted in a very efficient separation of pentlandite from pyrrhotite in all sizes. Separation of this mineral is discussed in relation to fundamental functionality of the reagents used.

Jan 1, 2017

By L. Gasser, N. Bellinger, H. Awatta, A. Merati

As aircraft age, the extent of interactions between fatigue and other damage mechanisms, such as corrosion and fretting, increases. At present, however, there is no generally accepted methodology within the Aircraft Structural Integrity Program (ASIP) framework to account for the effects of these interactions on life and the residual strength of aging aircraft components. A comprehensive program is being carried out by the National Research Council Canada in collaboration with Analytical Processes/Engineered Solutions, using the Holistic Structural Integrity Process (HOLSIP) to address time and cyclic load issues. This approach predicts the evolution of a discontinuity state in a material from production to retirement. This paper summarizes the results of a study on the 2024-T3 aluminium alloy in different forms (clad and unclad), thickness, and specimen geometry. This study consisted of identifying the microstructural features associated with crack nucleation sites and relating them to the testing parameters and fatigue life. Several coupons were fabricated and fatigue-tested. The fracture surfaces were carefully examined, and the physical characteristics of the microstructural features found near the crack nucleation sites were analyzed. Effect of stress level, loading direction, coupon geometry and surface condition on the number of crack nucleation sites, and fracture origin size has been discussed. Four distinctive mechanisms were found to be responsible for crack nucleation: for unclad materials constituent particles, oxide residue, surface irregularities and for clad samples the clad layer was the sole fracture origin.

Jan 1, 2006

By G. Beckstead, L. F. Sawatsky, R. Nutbrown, D. Long, G. Gould

"This paper presents a case study for optimizing water management at Gregg River Coal Mine located near Hinton, Alberta. The optimization study was derived based on a review and assessment of existing management practices and plans for future operation and final reclamation. A proactive water management strategy was developed to assist mine staff in adopting a rational, environmentally sound, and economical approach to water management. A plan was developed to provide for safe operation, self-sustaining operation, low maintenance, minimum negative environmental impacts, and anticipation of future needs for existing and future operations. A plan for final reclamation drainage was developed including establishment of effective, sustainable, and maintenance-free water management systems. The study demonstrated the importance and benefits of a proactive approach for integrated mine water management. This approach is recommended for other similar mine operations because it will improve environmental compliance and reduce costs of water management. IntroductionGregg River Resources Ltd. (GRRL) operates an open pit coal mine on the eastern slopes of the Rocky Mountains, located about 45 km south of Hinton, Alberta. GRRL opened the mine in 1982 and expects to continue operations after Year 2000. GRRL has progressively reclaimed the disturbed area and expects to complete mine-land reclamation shortly after mining in the area is complete. The existing disturbed area and reclaimed area covers approximately 9.5 km2 and will expand to about 10.5 km2 upon mine closure.Like other coal mines in the mountainous areas of Alberta and British Columbia, the GRRL coal mine is subject to highly variable temperatures and moisture conditions. Average monthly precipitation varies from a low of 12.6 mm in January to a high of 113.0 mm in August, based on the precipitation record at the mine site since 1982. Despite the relatively high rainfall during the spring and summer months, excess water problems during rainfall events are quickly replaced by water deficit conditions during periodic droughts. Surface runoff varies from near zero in the winter to a mean annual monthly maximum of 78 mm during the month of June. The mean annual surface water yield is 345 mm."

Jan 1, 1997

By Philippe Ribagnac, Bruno Courtaud, Jean-Marie Lambert, Valérie Weigel

Mabounié is a polymetallic deposit in Gabon containing niobium (1.2 wt.%), tantalum (0.03 wt.%), rare earth elements (REE) (1.4 wt.%) and uranium (0.03 wt.%) that are mostly carried by pyrochlore minerals. The classical route for niobium recovery is a pyrometallurgical process that consists of pyrochlore flotation, dephosphorization of the niobium concentrate and aluminothermy to obtain ferro-niobium. Pyrochlore concentrates can also be treated by a hydrometallurgical process with a mixture of sulfuric and hydrofluoric acid leaching followed by solvent extraction to separate niobium and tantalum. However, the first process does not allow recovering REE and the second one is not environmentally friendly because of the use of HF. ERAMET is looking for new opportunities on strategic metals market and has recently developed a hydrometallurgical process for the recovery of all these metals based on a sulfuric acid treatment of the ore (Donati, Courtaud, & Weigel, 2014). As for most of the oxidized ore processes, the major impurity is iron (~30 wt.%). Thus, in this hydrometallurgical process, the question arises of the elimination and stabilization of the iron as residue. The iron in solution is ferrous; goethite precipitation seems the most adapted crystalline form. Lab and pilot tests have shown kinetics of precipitation of 6 g.L-1.h-1 at pH 4.5. To reduce the salt discharge, sodium-jarosite form is more adapted, but at pH 2, 95°C only 30% of iron is precipitated in 5 hours, compared to 100% in goethite form at the same time and pH 2, 80°C. Different ways of oxidation were tested, air, pure O2, activated carbon, without drastic effect. The more efficient was ozone use, at room temperature; the kinetics of oxidation is five time faster than the other ways with 30% of sodium removed from the solution.

Jan 1, 2016

By A. P. Fletcher, K. Croteau

The intent of this paper is to cover some aspects of preventive maintenance methods which have come into wider usage in recent years as a means of increasing operating efficiencies. Particular emphasis is placed on lubrication and related servicing.

Jan 1, 1967

By S. Feinstein, I. Reznik, Y. H. Hatzor, O. Shitrit, Y. O. Rosenberg, H. J. Vinegar, S. Nguyen

"We report the effects of porosity and total organic carbon (TOC) content on the mechanical behavior of organic-rich chalks, based on laboratory measurements. The organic-rich chalks are from the Senonian Ghareb and Mishash formations. This deposit is an immature oil-prone source rock, about 300 meters thick, situated at shallow depths (several hundreds of meters) in the Shefela basin in central Israel. The study is based on core data collected from the Zoharim borehole.Three main phases comprise the bulk volume of this rock: 1) carbonate mineralogical phase (predominantly calcite); 2) pores (mostly saturated with brine); and 3) solid organic phase (type IIS kerogen). The mechanical effects of porosity (23-45%) and TOC (4-19%) are evaluated based on bulk incompressibilities vs. volumetric fractions analysis. Volumetric fractions of mineralogical and organic phases were obtained by porosity, density and TOC measurements. Saturated rock bulk moduli were measured through ultrasonic velocity measurements. Saturated rock bulk moduli correlate best with the sum of kerogen and pore volume fractions, rather than each of them separately. The volumetric fractions were also used to define the range of bulk modulus of the organic-rich chalk, using the Hashin-Shtrikman upper and lower bounds. Based on Marion's Bounding Average Method (BAM), the normalized stiffness factor of the chalk averaged at w=0.197, indicating a soft pore geometry. Using the average normalized stiffness factor, the BAM predictions showed excellent match with the saturated rock bulk modulus and the sum of kerogen and pore volume fractions. Based on our findings, it is inferred that kerogen grains do not support the solid skeleton but are distributed between the minerals grains. We also propose here a straightforward approach for calculating the Hashin-Shtrikman bounds, based on TOC and porosity measurements. The mechanical effects of porosity and TOC indicated here are very important for the understanding of the influence of immature kerogen presence in highly porous chalks, as the Ghareb and Mishash formations."

Jan 1, 2015

By Ralph Harris, Javier Jara

"Oxygen is essential in gold cyanidation. It is supplied to the leaching media by sparging oxygen or compressed air into the cyanidation tank. The rate of oxygen transfer is critical to achieve the desired oxygen concentration in solution.The performance of a novel device for gas sparging recently developed at McGill University is compared to the mass transfer characteristics of the two spargers most used in the gold industry: the four lance configuration and the inverted cone. The distribution of gas and the kinetics of oxygen desorption of the three types of spargers was studied in a 140 litre tank. The oxygen dissolution of the new device is three to five times faster than the other spargers. This could increase the leaching rate and/or decrease the cyanide and oxygen consumption.IntroductionIn hydrometallurgical processing, it is often necessary to bubble gas through a pulp to carry out the wanted reactions. The gas can act to agitate the pulp and it can also supply reactant. The rates of the reactions which require a reactant supplied by the gas are often dependent on the rates of mass transfer from the gas to the solution.A common example of this is gold cyanidation which requires oxygen for gold dissolution. Since the gold containing slurry is rich in other oxygen consuming substances (sulphide like pyrrhotite), it is important to provide enough oxygen to allow complete gold dissolution within the residence time of the cyanidation reactors. It has been demonstrated that the rate of gold dissolution is directly proportional to the dissolved oxygen concentration of the pulp which in turn is proportional to the oxygen partial pressure in the bubble 1 2 3. Improving the rate of mass transfer of oxygen increases the dissolved oxygen concentration of the slurry and therefore improves the rate of the reaction.The rate of mass transfer from a bubble to its surrounding solution increases with decreasing bubble size and increasing gas bubble residence time which in turn increases with decreasing bubble size. The generation and dispersion of small bubbles is thus critical to achieving high rates of mass transfer. Different configurations and devices used to inject gas have different effects on the bubble size and the residence time, influencing the overall rate of mass transfer. Therefore better mass transfer can be achieved by adopting a more efficient method.The methods tested in this report are the four lance configuration (wall spargers), the inverted cone and a new device, designated HCD. The wall spargers and the inverted cone are used widely in the industry today."

Jan 1, 1994

By R. A. S Villegas

The Brazilian government announced in 2007 its plans to reactivate the nuclear program. As a result of this decision, a new nuclear power plant is already being built and there are studies dealing with, among other activities, the building of 4 to 8 new ones until the end of 2030. Such increase on the country?s uranium demand affects INB, the Brazilian state company that?s in charge of uranium supply. This paper describes scenarios predicted to the Brazilian nuclear industry for the next years and the INB plans to meet the country?s needs in terms of uranium exploration and production.

Aug 1, 2010

By Robert P. Dufresne

Electrolytic cells are used in electrowinning (EW) and electrorefining (ER) of non-ferrous metals such as zinc and copper, and are a critical part of the purification process. The cell is a large basin and has an electrolyte or aqueous solution, an anode and a cathode, an insulator, and incoming high amperage. Cells are exposed to unfavourable internal and external factors that have a direct impact on their lifespan. Their deterioration can be caused by incorrect polarity, insufficient magnitude, their construction, tension stress, thermal shock, corrosion and other, and their maintenance and replacement can be time-consuming, costly, difficult and environmentally unsafe. Occupational health hazards and dangers posed by the maintenance and removal of the cell should also be taken into consideration. Modifying the design and fabrication method of the cell, using chemical-resistant reinforcement, and increasing tensile and mechanical strength will defer maintenance for a very long time. This can be achieved by a double hull system that comprises full-length composite reinforcement, polymer concrete reinforced with fiberglass pultruded rods and rebars, fiberglass structural layers, and special resin matrices. This will provide protection against thermal shocks, corrosion, leakage, cracks. The design of this cell incorporates a lifting system that will afford quick and easy install without having to move a great number of cells in close proximity, since it is strong enough to stand on its own and not have to be bonded to adjacent cells. As well, the cell can be anchored with ease as it remains stable. This is especially important because space is limited to lift and manoeuver between the cell and the double-girder overhead travelling cranes. The lifting system can also prevent electrocution and loss in product quality, while increasing efficiency and safety in the workplace. Considerable savings in terms of production downtime are also part of the equation. INTRODUCTION Maintenance and replacement of electrolytic cells in electrowinning and electrorefining are operations that pose many challenges, health and safety concerns, and give rise to substantial operational costs. These problems have existed since time immemorial. Electrolytic cells are made of conventional concrete or polymer concrete, and because of the very nature of their composition and their exposure to severe and environmental conditions, their lifespan is short. Although polymer concrete is composed of high-quality materials, and has good thermal stability and resistance to chemicals, nonetheless, maintenance is frequently required in order to maintain the integrity of the cell and to ensure the quality of refined metals. Repairing concrete is a non-permanent solution as cracks will reappear, and every repair weakens the integrity of the cell a bit more, until it reaches a knock- down point and the structure is compromised. The cell needs to be replaced, otherwise the cell will collapse.

Jan 1, 2019

By R. Mulligan

"The Cordilleran tin belt extends from the Seward Peninsula in westernmost Alaska to Mexico. Throughout the Canadian section, tin occurrences are mainly confined to a belt along the northeastern fringe of the Western Cordilleran sub-region; the boundary of this sub-region with the Eastern Cordilleran sub-region is most simply defined as the practical eastern limit of granitic and metamorphic rocks. The stratified rocks underlying this restricted belt are mainly late Precambrian and early Paleozoic miogeosynclinal sedimentary rocks, which are more or less metamorphosed but otherwise are generally equivalent to the less severely deformed rocks underlying the Eastern Cordilleran sub-region. They contrast with Late Paleozoic - Mesozoic eugeosynclinal volcanic-sedimentary assemblages farther west, but the granitic intrusions throughout are mainly of Late Mesozoic age. Thus, narrowly defined, the tin belt largely coincides with a lead-zinc-silver metallogenic province, whereas copper deposits characterize the eugeosynclinal regions to the west. In addition to the tin occurrences, which include the Sullivan lead-zinc-silver mine, Canada's only significant producer, the belt contains all the beryllium, most of the tungsten and many Iithophile-type molybdenum occurrences. Several types of occurrences of each metal are represented. Lithium occurrences in the Canadian Cordillera are notably rare, and these few are insignificant."

Jan 1, 1971

By Christopher R. Lattanzi

"Discounted cash flow analysis provides a means of relating the magnitude of expected future cash profits to the magnitude of the initial cash investment required to purchase an asset or to develop it for commercial production. The objectives of discounted cash flow analysis are to determine:.. The net present value of a stream of expected future cash revenues and expenditures... The rate of return which the expected future cash flows will yield on a given level of initial cash investment.In the case of mineral properties, discounted cash flow analysis is generally accepted as the preferred method of valuation, whenever sufficient data are available to permit its reasoned application. Sufficient data are required to support estimation of all of the individual elements of cash revenue and cash expenditure which will be associated with the development and operation of the property, up to the end of its estimated life. It is the accuracy of these input estimates which determines the validity of the resulting determinations of profitability and rate of return on invested capital.In undertaking any discounted cash flow analysis, it is important to recognize certain fundamental attributes of the mining industty:.. The basis of any mineral development is the existence of an ore reserve... Costs are determined by the number of tonnes mined and processed, while revenues are determined by the number of pounds or ounces of metal produced. The two are related by the recovered grade of the ore... Profit is typically more sensitive to changes in revenue than it is to changes in cost... Commodity price is a principal determinant of revenue, but it is also the factor with which is associated the greatest level of financial risk.In the end, of all of the factors which must be considered in the discounted cash flow valuation of a mineral property, the most significant are the reliability of the reserve estimate, particularly with respect to recovered grade, the price at which the product is to be sold, and the risk of not maintaining the projected level of price."

Jan 1, 2003