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By C. A. Grandison

The economic evolution from an agrarian society to an industrial and service-oriented economy is apparent to most students of history. The long-term trend is almost taken for granted, it does not require explanation — it is accepted as the nature of man to improve his standard of living. However, there are fluctuations around this trend line which have provoked a great deal of thought. The ability to understand and control these fluctuations would yield many benefits, it would eliminate economic waste and public hardship, and would no doubt make a few fortunes. I f it is not possible to control or eliminate these fluctuations, then a reasonable forecast of the tinting, rate of change and magnitude of the fluctuations would be invaluable to industry and government.

Jan 1, 1976

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 J. M. Mutmansky, A. Wang

This paper defines the elements of a basic economic model for decision making when considering a methane drainage system for an underground coal mine. A drainage system entails significant capital and operating expense; hence the decision to utilize drainage must be made carefully. The model outlines the basic structure of decision making and considers the costs and benefits when the methane is marketed and when the methane is vented to the atmosphere. The effects on mine safety and the dust levels in the mine are also considered, both in a general format and as economic variables. Sources of information for executing this decision making are provided for an actual mine decision.

Jan 1, 1999

By A. Wang

This paper defines the elements of a basic economic model for decision-making when considering a methane drainage system for an underground coal mine. A drainage system will require significant capital and operating expenses; hence the decision to utilize drainage must be made carefully. The model outlines the basic structure of decision-making and considers the costs and benefits when the methane is marketed and when the methane is vented to the atmosphere. The effects on mine safety and the dust levels in the mine are also considered, both in a general format and as economic variables. Sources of information for executing this decision-making are provided for an actual mine decision.

Jan 1, 1997

By J. M. Mutmansky, A. Wang

This paper defines the elements of a basic economic model for decision-making when considering a methane drainage system for an underground coal mine. A drainage system will require significant capital and operating expenses; hence the decision to utilize drainage must be made carefully. The model outlines the basic structure of decision-making and considers the costs and benefits when the methane is marketed and when the methane is vented to the atmosphere. The effects on mine safety and the dust levels in the mine are also considered, both in a general format and as economic variables. Sources of information for executing this decision-making are provided for an actual mine decision.

Feb 24, 1997

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 A. S. Richardson

THE design of mine airways receives, in general, very little engineering treatment. To a large extent this is, of course, due to the fact that information upon which to base calculations is seldom available in definite form. In many mines the extent of the workable deposits may not be known at the time an air course is planned, and the length of service is indeterminable. Volume of air required for ventilation may also increase with extension of the life of a property, and natural obstacles, such as heavy ground, often place limitations upon the size of opening that can be maintained. Perhaps a majority of the shafts used in ventilation of metal mines were originally intended as hoisting shafts, and many of the tunnels and cross-cuts similarly used, were also designed as haulage ways or for other operating purposes. Even when a shaft is sunk solely for ventilation, custom usually dictates a size and shape consistent with the type commonly used for ordinary operations, because experience has demonstrated it can be excavated and maintained. In fact it may not be very far wrong to say most ventilation openings were never made with any consideration as to economic design for such use. When an air course is required to pass air between different parts of mine workings under a fixed pressure, the size of opening required for a given volume of flow, is, of course, determined by the resistance factor of the air course. It is then impossible to proportion the opening with reference to economics of power consumption, and this paper is limited to the design of openings where ventilation pressure or power consumption may be varied for economic advantage.

Jan 2, 1926

By Patrick Wong

The design of piling platforms is addressed in BRE (2004) for both fine grained and coarse grained subgrades. However, for coarse grained subgrades, piling platform designs can often be overly conservative due to either conservative assumptions on soil friction angle, or concerns over density variations of granular fill, particularly for made-ground. This paper provides guidelines on economic design of piling platforms on coarse grained subgrade by providing recommendations on ground characterization, assessment of soil properties and the use of non-linear stiffness soil behavior. An innovative performance-based design approach is also introduced, utilizing proof rolling with associated testing and interpretation using small strain theory to overcome concerns regarding potential ground variability of made-ground. A case study is presented to demonstrate the successful application of this performance-based approach to avoid having to construct a new piling platform over a 2 ha area. Small strain, non-linear stiffness theory was used to enable a practical proof rolling pressure to be adopted without having to reach the design or ultimate operating pressure. The author considers that the performance-based approach adopted on the case study may be similarly applied to a range of other projects to derive economic solutions.

Nov 1, 2022

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 Norman D. Fitz Gerald

THE growth of domestic requirements for motor fuel has been phe-nomenal, rising year after year in a fashion almost unique among com-modities, resisting depressions and forging rapidly ahead in times of prosperity. Consumption advanced from 226 millions of barrels in 1925 to 522 millions of barrels in 1938; or 130 per cent. The economic influ-ences generating and sustaining this demand are of vital concern to the petroleum industry. The general factors affecting utilization of motor fuel are well known but it is the purpose of this paper to employ the recently developed technique of economic dynamics to describe them mathematically. Such problems in economic analysis are complicated by the freedom of all the variables to fluctuate, their mutual interdependence, changing incidence upon one another, and the nonquantitative character of some of them. Economic quantities and relationships, unlike those of the physical world, are continuously changing and this dynamic characteristic is both a distinguishing and confusing feature in economic research. The com-plexities of the problems require application of the analytical devices of mathematical statistics to uncover the probable relationships between factors. The procedure employed is to formulate a logical relationship linking the dependent to the independent variables, and then simul-taneously, rather than sequentially, determine their separate effects by multiple correlation. This transformation of common knowledge to quantitative terms makes it possible to measure the probable effects of changing conditions upon requirements, assisting in the sound interpreta-tion of economic policies. The utility of the results of such dynamic analysis is in sharp contrast to the sterility of the trends and other simple empiricisms of descriptive statistics. It is not intended in this study to throw light on the reasons why any motor fuel at all is consumed; but to discover relationships explaining why more was consumed at one time than at another. Specifically the prob-lem is confined to the measurement of the influences of statistically

Jan 1, 1940

IT IS impossible to speak in exact terms of the effect that selective flotation has had, is having, and may have on the State of Utah. Its results enter into the economic structure of the state in so many ways and its ramifications are so widespread, that every line of industry is affected. Some effects can be definitely determined; others can be reasonably approximated; but the effect as a whole can not be set out in exact figures. Utah is essentially a mining state; mining is its basic industry and always will be. Agriculture, equally a basic industry, and of course, equally vital, can be practiced on only 6 per cent. of the 85,000 square miles of its area. It follows, therefore, that the economic future of this state depends upon a development of its natural resources. About 6 or 7 years ago, the mining industry in Utah was at a low ebb. This condition was caused partly by postwar conditions and other temporary causes, but prevailed also, which was most important, because the direct-smelting ores of the state were being rapidly exhausted and the cost of treatment of complex ores was almost prohibitive. Furthermore, the wet concentration of low-grade ores was unsatisfactory and did not result in producing a good smelting product. On visualizing this situation, one of the large smelting companies in the valley had the courage, ability and faith to develop and expand the principles involved in selective flotation of complex ores. This example has been followed by other smelting and reduction companies and the result has changed the entire aspect of the mining industry in Utah. The utilization of the zinc in the low-grade, lead-zinc-silver ores was the principal problem to be solved. The average yearly production from the State of Utah for the 10 years beginning 1914 and ending 1923, was something less than 10,000 tons of zinc concentrates. This period includes the world war, when abnormal prices stimulated production. In 1924, selective flotation began to be practiced on a considerable scale, replacing concentration by gravity and bulk flotation which had been used generally until this time. PRODUCTION AND VALUE OF ZINC CONCENTRATES The production of zinc concentrates during 1924 was approximately , 24,000 tons, or twice the average yearly production of the previous 10

Jan 1, 1928

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 Tronson K

Improvements in technology do not necessarily lead to higher profits: the benefit of lower costs can be captured by coal buyers, governments and workforce rather than by the colliery operators. The economic impact of longwall mining in Australia has been critically assessed to provide lessons for the future. For a variety of reasons, companies investing in longwall equipment in the past five years have generally not achieved an adequate return on the funds invested. The effect of technological innovation must be examined in the light of competitive forces operating in the market. Projections of cost reduction trends in the coal industry have been applied to a world cost model to provide a picture of the coal industry in the year 2000.

Jan 1, 1988

By J. Elbrond

"This paper describes qualitatively the progressive are losses and rock dilution in a mining project from the geological modelling to and including the concentration. A simple theoretical model of the net present value of a deposit, assuming a log-normal grade frequency function, is used to find the pair of decisions on rate of production and cut-off grade, which maximizes the net present value. Various degrees of ore losses and rock dilution are then applied on this optimum, and the resulting decreasing net present values are calculated, as well as the increasing cost of metal and the increasing metal losses as a function of are losses and rock dilution.IntroductionDue to a variety of uncertainties, to inevitable lack of precision in deposit estimation and in mine planning, and due to production constraints, ore losses and rock dilution occur throughout the many phases of a mining project. The phases range from the geological definition of the orebody, over the cut-off grade optimization and decision, over the design of the mining method and the actual mining to the ore dressing, where the final loss of valuable ore into the tailings occurs. Quantification of ore losses and rock dilution are mostly difficult if not simply impossible to obtain. At the end-phase an estimate of the total dilution may be obtained with some degree of precision by observations of the amounts and analysis of concentrate and tailings. It is much more difficult to estimate the total ore losses because the uncertainty of the geological modelling in the initial phase and in the mining phase is very difficult to quantify, despite the use of geostatistics for grade estimation.Many attempts at quantification of ore losses and rock dilution have been made and some examples are shown in Table I. Although they differ widely from each other, it is obvious from these figures that ore losses and rock dilution are significant and have considerable effects on the economical results of a mining operation. Life length, net present value, cost of producing metal and the loss of metal are all affected."

Jan 1, 1994

By Joseph E. Pogue

THE period of new oil discoveries in Illinois began in February 1937, when The Pure Oil Co. found the Clay City field the forerunner of a number of limestone pools. The importance of the area was emphasized greatly in December of the same year with the discovery of excellent sand production by The Carter Oil Co. at Louden and in June, 1938, with the discovery by The Texas Co. of the Salem field producing from two sands and one lime- stone horizon. By September, 1939, new discoveries in Illinois were estimated to have added, under prevailing production practices, some 500,000,000 barrels to the crude oil reserves of the United States and to have produced to that date some 63,000,000 barrels with daily production passing the 300,000-barrel mark by Sept. 1.

Jan 1, 1939

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 Norman Gerald

THE lack of a continuous operating balance in petroleum refining, which is analyzed in this paper, is by no means a feature solely of this division of the oil industry. Serious disequilibria of a capital as well as an operating nature exist both in the producing and marketing departments, while problems in the former and to some degree the latter are complicated by political involvements. Attention has previously been directed to the unstabilizing influence of present proration formulas in stimulating unnec-essary drilling.1 While equilibrium in petroleum refining operations has been fairly well maintained in the past decade, examination of departures may prove fruitful. Economic analysis is the application of time and motion study to the functioning of management, rather than labor. Properly applied it may reveal changes in policies that would increase the utility of the properties and facilities of the industry for stockholders, employees and the public, while contributing a stabilizing influence to the general economy. The study of economic equilibrium is essentially one of measurement and interpretation, requiring adequate data and the development of a tech-nique of analysis that employs statistical and mathematical methods as a supplement to the broad descriptive phase of economics. Economic equilibrium in petroleum refining is a dual concept. It embraces both the over-all balance between total storage and total demand for major products and the internal balance between the demands and inventories of the various products. The latter is the more complex of the two for it is concerned with proportionating the supplies of the several products stemming from the joint source to the demands for the individual products which are subject to wide variations. All the products are essentially nondurable goods, and they are used both by producers and consumers but in varying proportions. Motor fuel is very largely a consumer's good, while residual fuel oil is almost entirely a producer's good, the other products falling between these extremes. The peculiar-

Jan 1, 1939

Completion of a project requires two separate money-focused activities, namely economic evaluation of the cash flows underlying the project (before financing) and if the economics look promising, how it can be financed. Economic evaluation might be best led by a person with a technical-operating background, whereas financing might be best led by an accountant. Both should be presented in simple language with easy to understand models. Economic evaluation has a sad and bad history because it evolved from the fringes of accounting. Anyone can become a self-appointed practitioner. Some still take pride in mathematical complexity without realising that they distance themselves from the decision-makers and alienate other team members. Today there is no evaluation modelling consistency across the mining industry and this reflects poorly on our discipline. It is not tolerated amongst our peers in engineering and accounting. In 2009 æbest practiceÆ economic evaluation modelling is well defined. It is:easy to follow;tailored to its purpose;transparent;discipline, rigour and consistency;recording of all source data; and hencequick to audit. Mantra: If you cannot readily understand my model you do not have a problem, I do! The task of the economic model is to make the range of business cases underlying the decision easy to understand. Intellectual power is used to simplify the decision to its key issues and risks and to present the full range of possible business outcomes in readily understood terms. Project team members, management and the board must be able to make their decisions with æeyes wide openÆ. A steering committee should be established to develop a set of standards and practices that could be adopted for economic modelling within the industry. The industry needs to purge itself of the undisciplined economic evaluation modelling that now characterises the discipline.

Jan 1, 2009

By K. Oraee

Zarshuran gold deposit, with the total reserves of some 12.5 million tons of 4.18 g/ton ore, is considered to be an important gold mining project in the area. In this paper the feasibility studies of the whole project is carried out on the basis of several economic variables. Given that mining data are often of uncertain nature, these economic variables have therefore been estimated under the conditions of uncertainty. The resultant Net Present Value is hence also obtained under the same conditions. For this purpose, a model is first devised with the help of Excel and COMFAR software. The model is then developed that considers different scenarios which would result in different expected values for the economic variables. It is concluded that the NPV of the project is most sensitive to gold and silver price and that other variables such as discount rate, operating and capital cost all affect the feasibility of the project with lower degree of severity. Finally, risk analysis is also carried out using Mont Carlo technique, in order to estimate the most probable value of NPV. The average NPV calculated in this way is US$ 49.7 Million, whilst without due consideration of risk, this would be US$ 36.6 Million. The techniques used, together with the procedures adopted in this paper, can be used in feasibility studies of all mining projects. Such decision would result in more accurate Net Present Values than expected from other frequently used methods.

Jan 1, 2011