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By Sandra L. Mesa-Espitia, Gretchen T. Lapidus

Gold present in arsenopyrite matrices is refractory and requires highly oxidative pretreatments in order to obtain acceptable degrees of extraction. However, these release many byproducts that are harmful to the environment. In the present work, a high-grade arsenopyritic ore was pretreated with different solutions, containing hydroxide ion, EDTA, oxalic, tartaric, or citric acids, to improve gold extractions in a posterior leaching step. The pretreatments were carried out at room temperature for 24 hours with a respective ligand concentration of 0.25 M. Once completed, the residue was leached in a thiosulfate solution to quantify the effect of the pretreatment on gold extraction. Only 29% of the gold content was leached, with very slow kinetics, in the untreated mineral. However, after pretreatment with tartaric or citric acid, the kinetics improved, although the percentage of gold extraction only reached 42-45%. The highest gold recovery, with very rapid kinetics, was found with the oxalic acid or the hydroxyl ion pretreatment (70 and 62%), respectively, but also corresponded to the most arsenic co-dissolution.

Jan 1, 2014

By Robert D. Brown, Robert B. Parsons

"Careful tax planning and proper attention to the regulations can result in an optimum deduction ""of the 25% federal resource allowance. Introduced in the Income Tax Act in1976, in part to compensate for the disallowance of provincial mining taxes and royalties. the 25% ""resource allowance"" is a permitted deduction in computing taxable income from mining and petroleum. However, the rules relating to the deduction are complex, and the importance of the deduction which can readily exceed 25% of net income- is frequently underestimated. This month, Tax Notes discusses the basic rules of calculating the resource allowance, and suggests some tax planning aspects which may warrant consideration.May 6, 1974 - "" .. . our provinces have adjusted royalties, mining taxes and other arrangements to derive what they perceive to be a fair share for the benefit of their people. However, a provincial resource is also a national resource... I am proposing that revenues derived by provincial governments in respect of production from a… mineral resource should no longer be.\ deductible in computing the income of the operator. .. I am proposing that. .. there be an extra abatement from federal income tax in respect of taxable production income.. .fifteen points in the case of mineral profits. .. "" - The Honourable John N. Turner, Minister of Finance. June 23, 1975-"" '"" to meet, at least in part, the request for some form of deductibility in the tax system for provincial resource levies... to offer more incentive to those who explore and develop in Canada. .. I am now proposing, the extra fifteen point abatement of federal taxes would be withdrawn... at the same time, I am introducing a new resource allowance, which would be an extra deduction from income equal to 250/0 of production income.. ."" - The Honourable John N. Turner, Minister of Finance."

Jan 1, 1980

By J. A. Brusset

THE Greenhill mine of West Canadian Collieries, Limited, is situated at Blairmore, Alberta, and produces 2,500 tons per day of bituminous coal. On Monday, October 25th, 1943, smoke was discovered by a party of firebosses on their regular weekly inspection of air-ways. Probably the fire had been smouldering for several days but, as it had started on the outcrop at the top of an old raise filled with dirt, only a small quantity of smoke could filter through, and the plume of mist that crowns the fan at that season had prevented the fan-man from noticing it. This raise is only about 200 feet from the fan, and is 70 feet long between the fan-drift and the outcrop. It was impossible to prove the origin of the fire, as it had probably started several days before it was discovered, but it is possible that a careless smoker may have thrown a match into the opening at the outcrop, and that the old, dry timber had caught fire. The airways are in No. 2 seam, a bituminous seam 18 to 25 feet thick surmounted by shales and sandstones. Only 45 feet vertically above it is No. 1 seam, 12 feet thick, overlain by a strong conglomerate. In that vicinity, No. 1 seam had been worked out about ten years ago and the strata between the two seams are undoubtedly fissured. The pitch of both seams is 43 degrees.

Jan 1, 1945

By S. Huang, K. Xia

"During crushing, rock particle is subjected to complicated loading and the particle shape influences the fragmentation outcome. Thus, a highly controlled laboratory test is desired to establish the relation between the loading and the fragmentation parameters for better understanding the rock crushing mechanism. In this work, a split Hopkinson pressure bar system in combination with high speed cameras is utilized to carry out a dynamic ball compression test, in which the spherical rock sample is adopted to avoid the shape effect. Using the elasticity theory, the history of the axial symmetric tensile stress perpendicular to the diametrical direction along the loading axis is determined, from which the loading rate and the dynamic indirect tensile strength are calculated. With the aid of the moment-trap technique, the total energy absorbed by samples is accurately determined from the one-dimensional wave analysis. Furthermore by considering the kinetic energy of the sample fragments using the high speed camera snapshots, the surface energy is determined for each sample. The relations between the loading rate and the fragmentation parameters, i.e., the number of fragments and the surface energy are established. The application of this method to a granitic rock shows that it is flexible and can be applied to the crushing study of generic brittle solids. INTRODUCTIONCrushers are widely used to break rocks to extract specific minerals in the mining industry, and to obtain rock fragments with desired size distribution in construction industry. During crushing, the breakage of particles can be in either the single-layer mode or the multi-layer mode. In the single-layer mode, the particle breakage can be assumed to be isolated, in which the interaction between particles can be ignored. It is thus suggested by many researchers that highly controlled single particle test should be performed to establish the relation between the input mechanical energy and size reduction for better understanding the crushing mechanism (Yashima et al., 1987; Tavares, 2007; Pitchumani et al., 2004)."

Jan 1, 2015

By Robert B. Parsons

"Draft income tax amendments aimed primarily at certain carve-out arrangements prevalent in the oil and gas industry could have devastating results for long standing royally arrangements in the mining industry . Whether or not this potentially damaging effect is intended is largely beside the points-the point is that the mining industry would be well advised to become familiar with the draft amendments and make sure that the potential damage to existing and future royalty agreements is minimized.The draft amendments fail to take into account the nature of mineral royalties and app ear to reflect a lack of understanding of the characteristics of the mining industry.IntroductionOn July 19, 1985 Finance Minister Michael Wilson released draft amendments to the Income Tax Act which are intended 10 effectively thwart the use of so called “carve-out arrangements"".Unfortunately, the proposed amendments are so broad and far- reaching that countless ""innocent"" royalty arrangements in the mining industry, and in the oil and gas industry, are threatened. The potential harshness of the new rules would be compounded by the retroactive application to the amendments to longstanding royalty and similar agreements."

Jan 1, 1985

By H. Bannach

"This paper focusses on what seem to be the leading indicators of prosperity in the minerals industry during this decade: the geographical distribution of deposits, environmental impact, capital allocation and acid consumption. There is a potential for meeting environmental criteria at a reasonable profit margin, but those with limited acid demand within economic range will face hard times to meet growing environmental concerns, resulting in additional mine closures. At the other end, those with old waste dumps who are thinking about smelting capacity additions will need capital influx at a much larger rate than ever before. All things considered, a change should be made in the way the world's copper reserves are computed, because there is a growing need to internalize these effects back to the ore blocks before a meaningful estimate of reserves becomes available.IntroductionThe copper industry has undergone several changes during the past decade, many of which were expected to take place because they rel1ect the economics of ageing mines. However, many others took place that shocked the industry because they were not completely under control. The focus of this paper is to rel1ect on those changes, and on market expectations for this decade that somehow depend on their impact.To review the prospects for new mine developments and expansions from an industry perspective to a full extent, it would be necessary to consider not only the deposits themselves, but also geographical constraints, environmental constraints, labour composition, technology development and use, the availability of capital, ownership issues, and integration within the industry. This paper, however, will concentrate on only some of the key elements that are believed to playa major role in shaping the market in the decade that has just begun. These elements, all interconnected, are:"

Jan 1, 1992

By P. C. Richards

"Future Integrated Gasification Combined Cycle (IGCC) power plants will have superior environmental performance and unmatched efficiency.The Shell Coal Gasification Process (SCGP) is a clean coal technology, which can convert a wide range of coals into clean syngas for high efficiency electricity generation in an IGCC plant. SCGP flexibility has been demonstrated for feeds ranging from bituminous coals to lignites and petroleum coke, and the process is ideally suited for combined cycle power generation, resulting in efficiencies of 42% to 46% (LHV).In the Netherlands, a 250 MWe coal gasification combined cycle plant based on Shell technology is being built by Demkolec, a development partnership of the Dutch Electricity Generating Board (N. V. Sep). The plant is scheduled to start up in 1993. IntroductionBasic ConceptShell's experience with gasification dates back to the 1950s, when the first Shell Gasification Process was commissioned with oil as feedstock. There are now over 140 SGP gasifiers licensed. The experience gained on oil gasification provided a firm theoretical and practical base for the start of coal gasification process development in 1972.At that time, there were serious concerns about the future availability and price of crude oil. Coal gasification (making carbon monoxide and hydrogen by the partial oxidation of coal) was considered to be an important option for refinery applications, because the synthesis gas (syngas) produced can be used as:• a chemical feedstock for making transportation fuels and chemicals;• a source of hydrogen (making use of the water gas shift reaction) for upgrading petroleum products; and• a fuel for heating process streams and/or generating electricity."

Jan 1, 1994

By C. J. Kerr

"A recent information sheet from the Mining Health and Safety Branch of the Ontario Ministry of Labour was sent to all Ministry inspectors and engineers. The subject title was' 'Two Brakes on a Hoist Carrying Persons"" and it quotes mining regulation 699, sub-section 206(i):No hoist shall be used for the transporting of persons unless it has a braking system consisting of at least two sets of mechanical brakes to stop and hold the drum for the shaft conveyance transporting the persons.The intent of the regulation is that each of these brakes is to be set so that, individually, they can safely stop the drum carrying persons and also hold the drum without movement with the maximum manload.This can be achieved in the following ways: Single Drum Hoist-one brake on each side of the drum, one brake on the drum, one brake on the pinion shaft, where disc brakes are used two separate disc brake assemblies on the disc. Double Drum Hoist, brakes on companion drum can serve as backup brake only pinion brake with one drum unclutched.Friction Hoist, one brake on each side of drum As new hoists can be manufactured easily with a two-brake system, attention will be focused on retrofitting pinion brakes to older hoists.A brake mounted on a pinion shaft is designed purely as an emergency brake in the event of main brake failure , controls malfunction, and power loss."

Jan 1, 1989

By G. R. Baiden

This paper discusses the application of Load-Haul-Dump (LHD) machine teleoperation in combination with a guidance system for single operator control of multiple IJIDs. A system accomplishing these goals has been tested at Copper Cliff North Mine of Inco Limited. This development uses a high-speed, high-capacity production network to teleoperate an LHD during loading and dumping by using 3D video and radio remote control. Following loading, the operator dispatches the LHD using an automatic guidance system to traverse the drifts to the orepass. Remote dumping is done at the ore pass and then the machine returns to repeat the procedure. This has significant productivity gains and improvements in safety. Productivity is improved because operators are involved only in the loading and dumping part of the process. This frees the operators to utilize their time more effectively, loading or dumping a particular machine, while other machines with guidance systems continue to work travelling and/or automatically dumping ore in the ore passes. Safety is improved as the operator is located on a remote control station. Automatic dumping will be incorporated as a future development.

Jan 1, 1994

By O. E. Humeniuk, A. I. A. Salama, M. W. Mikhail

"Performance testing of prepartion plants is referred to as plant audit. It evaluates plant performance under normal operating conditions and is aimed at improving yield through knowledge of actual process performance and interactions between different processes in a plant.This paper describes the program to evaluate the performance of several Canadian preparation plants. The performance test requires the planning of a sampling campaign that would include all circuits in the plant. Samples are analyzed to determine washing characteristics (screen and float-sink), ash and per cent solids of feed and products of separation units in the plant. Performance characteristics are established based on analysis and material balance. Specific recommendations can then be made to improve recovery, and identify and explain potential causes of apparent deficiencies.The objectives of the program are to reduce the cost of production by improving recovery of clean coal and, in tum, to reduce disposed tailings, establish baseline information on coal preparation plants performance in Canada, and define R&D work needed to optimize plant operation."

Jan 1, 1993

By S. V. Burr

"IntroductionOne of the more puzzling geological enigmas, in the writer's opinion, is how rock can move sideways with respect to other rock. In the writer's study of regional northwest-southeast folding in North America (Burr, 1980), he may have found the answer to horizontal offset.Horizontal OffsetSideways movement or horizontal offset does not mean that the movement was, or is, horizontal. As indicated below, the actual movement may be at a high angle from the horizontal. However, it is the horizontal VECTOR, or offset, which is measured on surface by geologists. Vertical movements (thrust, normal, reverse) can be understood, as they involve blocks of rock , generally separated on four to six sides, which have been pushed up or subsided. Vertical faulting across dipping strata can produce APPARENT horizontal offsets. However, this thesis deals only with ACTUAL offsets.The ProblemFigure 1 is a plan view of a simple hypothetical horizontal offset. Three vertical dykes are intersected by a fault lineament. Two dykes exhibit no movement; the middle dyke has been offset a distance (a). Vertical faulting would have produced no horizontal offset. How can a horizontal distance (a) disappear or appear? Rock expands or contracts in infinitesimal amounts.SolutionThe map (Burr, 1980) shows the writer's interpretation of regional northwest-trending folds in Ontario. The writer made two observations about horizontal offsets during his thirty year study of these folds:1) All major horizontal fault lineaments strike at a high angle to the northwest fold axes. Many of the northwest-trending lineaments are fault s, but their movement is essentially vertical.2) Close to many of the known horizontal offsets (and several lineaments), there are areas where plunge reversals are so frequent and close together it is impossible to draw in all the fold axes at a scale of 1 inch = 4 miles, and, in the highly faulted Espanola area southwest of Sudbury, Ontario, all the indicated folds cannot be easily separated at a scale of 1 inch = 1 mile. The writer has observed folds less than 30 feet apart next to the strong Puskitamica-Chibougamau fault in northern Quebec."

Jan 1, 1982

By William E. Stanley

The paper examines the problems that arise in undertaking socio-economic impact studies to meet the requirements of environmental-impact legislation governing new mine development or expansion. An approach to undertaking socioeconomic impact studies is outlined, responses to specific problems are discussed and ways in which the mining company can use these studies to meet its general objectives are explored. The paper concludes by examining how a socio-economic study, as required by legislation, can be used to assist the mining company in achieving some general objectives it will have in developing a mine.

Jan 1, 1979

By T. Hadley, Northern Minerals Ltd, C. S. Griffith, T. A. Safinski, K. H. Soldenhoff, M. Fainerman-Melnikova, A. Manis

"ANSTO Minerals and Northern Minerals have been working together since 2012 on the process flowsheet development for the Browns Range project for the recovery of the heavy rare earths (Dy – Lu, + Y). Initial efforts were directed toward defining the most efficient and direct flowsheet for the Preliminary Feasibility Study (PFS), issued in June 2014, then towards the Definitive Feasibility Study (DFS), issued in February 2015. These goals were achieved by undertaking comprehensive laboratory and continuous piloting programs. Further improvements to the flowsheet following the DFS have been made. This publication provides an overview of the evolution of the process flowsheet based on these laboratory and piloting programs from the PFS through the DFS and beyond.INTRODUCTIONNorthern Minerals Ltd (Northern) has been working on developing their flagship project at Browns Range for the recovery of the heavy rare earth elements (HRE, Dy – Lu, + Y). The project is located in the north of Western Australia as shown in Figure 1. The Total Mineral Resource at the project is currently estimated at 8.98 Mt @ 0.63% total rare earth oxides (TREO) comprising 56,663 t of contained TREO using a cut-off grade of 0.15% TREO. Of the Total Mineral Resource, 58% is classified as Indicated Resource, with the remainder in the Inferred Resource category.The deposit is characterised by breccia-hosted, hydrothermal, HRE-rich, xenotime mineralisation. The main gangue mineral associated with the xenotime is quartz. The distribution of rare earths (RE) observed for the xenotime mineralisation at Browns Range is presented in Figure 2. Extensive test work has shown that the xenotime can be readily beneficiated to between 20 – 40% rare earth oxide (REO) using a process consisting of crushing and grinding, followed by magnetic separation and flotation steps. Continuous piloting of this process was conducted on ~80 t of trench-sourced ore in late 2013 at SGS Perth, to produce ~2 t of ~20% REO mineral concentrate (MC) for hydrometallurgical testing. The composition of the MC produced during piloting is presented in Table 1."

Jan 1, 2016

By C. Díaz, A. D. Dalvi, C. E. O'Neill

Roast-reduction smelting (RRS) of nickel concentrate, combined with flash smelting of copper concentrate, was one of the process options that Inco considered as a means of meeting its 1994 sulphur dioxide abatement target at its Copper Cliff operations. RRS involves deep roasting the nickel concentrate in fluid bed roasters. The roaster off-gas is treated in a sulphuric acid plant, and the low sulphur calcine is reduction smelted with coke in an electric furnace to yield a sulphur- deficient matte. The latter material is converted to Bessemer matte in Peirce-Smith converters, with minimal evolution of sulphur dioxide, and the converter slag is reverted to the electric furnace. Excellent nickel and cobalt recoveries (Ire obtained. This paper discusses the development of RRS, including extensive commercial scale testing at Inco's Thompson Smelter, and its key operating parameters.

Jan 1, 1994

By B. A. Watters, G. A. Parslow, F. H. Mcdougall

Carbonate-rich rocks occur at several localities within the Flin Flon volcanic sequence of the eastern Amisk Lake area. The rocks occur in two areas: as a group of small occurrences on islands within Amisk Lake and as two much larger linear belts running parallel to the regional structure east of Amisk Lake. Mineralogically, the rocks consist of talc and Ca-poor ankerite with occasional graphite. Segregation of these minerals and colour variation impart a well-defined planar fabric to the rocks and where the units are fairly continuous (e.g. Mosher Lake), their trend and attitude suggests a concordant relationship to the volcanics. Major and trace analysis of22 samples confirms the presence of two types, with one type being represented in each of the two areas. Most of the elements studied can be used to characterize the two groups, but three elements in particular give a clear separation: Mg, AI and Ni. Recalculation of the major element analyses, on a water and carbonate-f ree basis, indicates that one group (large concordant bodies with high MgO, high Ni and low AI20.J is altered ultrabasic material of peridotitic or dunitic composition. Because no relict igneous material is observed, and the contacts are apparently very sharp, it is possible that the hydration-carbonization process occurred simultaneously with intrusion, .in a closed system. The other group (small occurrences with relatively low MgO, low Ni and high AI203J represents alteration of basaltic rocks. AIthough some analyses suggest the introduction of calcium, as carbonate, along with the volatiles, the major oxides have remained remarkably stable during the alteration process(es).

Jan 1, 1981

By Ki-Bok Min, Bona Park

"In spite of the applications of DEM models to emulate the elastic modulus, Poisson’s ratio and strengths of isotropic rock in laboratory scale, extensions to anisotropic rock and larger engineering scale still have many challenges to overcome such as robust verification and validation against observed field case. In this study, a discrete element modeling was performed in order to represent a transversely isotropic rock such as shale, and the upscaled model was applied to foundation and borehole problems using PFC2D. The applicability of the upscaled rock mass model was verified by an analytical solution. The DEM modeling of stress redistribution induced by an applied surface line load compares well with Boussinesq’s isotropic solution and anisotropic solution given by Bray. The borehole model with a circular opening under biaxial stress was compared with both isotropic and anisotropic solutions resulting in good agreement. The abilities of DEM model to investigate the micromechanisms accounting for complex macroscopic behaviors and to predict the macroscopic behavior are discussed.The results demonstrate that DEM modeling has the potential to be applied to anisotropic rock mechanics problems on larger engineering scales such as wellbore stability problems especially in shale formations. Furthermore, the effect of anisotropy modeled through this study may be able to explain failure behavior of anisotropic rock encountered frequently in real cases.INTRODUCTIONAnisotropy is prevalent in various types of rocks, especially in shale that contain a set of parallel bedding planes. These weak planes in various forms are sources of large deformation and low shear strength and contribute significantly to the anisotropic behavior of rocks (Amadei, 1996; Cho et al., 2012; Kim et al., 2012). As elastic and strength behavior of anisotropic rock is substantially different from that of isotropic rock, proper consideration of anisotropy is of great importance. There is extensive of experimental evidence showing the anisotropy of shale. Niandou et al. (Niandou et al., 1997) analyzed the plastic deformation and failure mechanisms of Tournemire shale were highly dependent on the orientation of bedding planes. Cho et al. (Cho et al., 2012) presented various deformations and strengths of Boryeong shale obtained from laboratory experiments. Fjaer and Nes (Fjaer and Nes, 2013) performed uniaxial and triaxial compressive strength tests using Mancos shale, and they observed that the shear sliding along the planes of weakness before the occurrence of a major failure can reduce the strength of anisotropic rock. The recent research has demonstrated that the anisotropy of rock is an important consideration in rock engineering."

Jan 1, 2015

By D. M. Cruden

"When two discontinuities form a tetrahedral wedge in a rock slope, a factor of safety for the wedge can be simply calculated (if motion is driven only by gravity and resisted only by friction) from plots of the normals to discontinuities on an overlay of a polar, equal-area spherical projection to which the great circles of a similar equatorial projection have been added.IntroductionThe stability of slopes in rock masses is often controlled by the discontinuities that exist in the masses. In particular, the geometry of the discontinuities constrains the ways in which the mass may fail. Displaying the orientation of the discontinuities on a spherical projection has been found to be a useful way of identifying possible failure modes. The most concise display shows the orientation of the normals (or poles) to the discontinuities that compose the fabric of the rock mass. Computer processing of large samples of discontinuity orientations is necessary if the sampling biases identified by Terzaghi (1965) are to be routinely corrected. Fortunately, displays of the poles to discontinuities (or pi diagrams) are relatively easily produced on the line printer of a computer or by a computer plotter (Cruden , 1978; Ramsden and Cruden, 1979). Unfortunately, further analysis of the stability of a rock mass has tended to use traces of typical discontinuities on a spherical projection rather than pi diagrams; examples may be seen in Hoek and Bray's book (1981)."

Jan 1, 1990

By Poul Hansen

"In mid-1986, a world-class mining enterprise was created in Highland Valley, British Columbia, bringing together the copper mining operations of Lomex and Cominco . In 1988, Highmont joined the new partnership.Highland Valley Copper is the largest copper mine in North America in terms of both tonnage mined and tonnage milled, and it is one of the largest in the world. Due to its relatively low ore grade its production of copper in concentrate ranks about ninth in the Western World.The current eighteen year mine plan is based on ore reserves of 761 million tonnes. The daily milling rate is 133 000 tonnes. At the end of mine life, a total area of approximately 6500 hectares will have been disturbed. At this time, vegetation has been established on about 600 hectares and while work will be done during the operating years, it will not be until the end of mine life, about 2008, that the last half of the land can be reclaimed and revegetated.Once final reclamation has been accomplished, Highland Valley Copper will have completed its "" temporary use of the land"". In the meantime, about 1250people have had employment for about 50 000 man years, at wages ranking among the best in Canada.IntroductionTo provide and sustain our way of life, we need steel, copper, aluminum, zinc and many other minerals.To sustain mining, we must have adequate ore reserves and replacement of reserves as they are mined. Each year the search becomes more difficult as more of the Earth's surface is investigated and depo sits are mined. This calls for aggressive and sustained efforts.In British Columbia, past and present mining activities have disturbed less than one-tenth of one per cent of the land.With today’s technology, mining operations can be substantially reclaimed and thus complete the cycle of ""A Temporary Use of the Land""."

Jan 1, 1992

By Bill Dupley

We believe that the inability of employees to effectively manage information has reached an epidemic problem throughout the corporate world. ? All the available knowledge in the world is accelerating at a phenomenal rate. ? The whole world's codified knowledge base (all historical information in library books and electronic files) doubled every 30 years in the early 20th century. ? By the 1970s, the world's knowledge base doubled every seven years. ? Information researchers predict that by the year 2010, all the world's codified knowledge will double every 11 hours.

May 1, 2003

By Brian Hall

For some years, the mining industry has been consistently delivering returns below the market average. One of the causes is a disconnect between what is perceived to drive value creation by many industry analysts and senior corporate executives, and what actually drives the intrinsic value of mining operations. The perverse effect is that strategies that should increase value are perceived to have the potential to drive share prices down, and vice versa. This paper challenges common perceptions of what drives a mining company?s value. Anecdotal evidence suggests that the key drivers of value in the market, and hence in many boardrooms, are such things as increasing the reserves and production rate, and reducing unit operating cost. However, while the quoted reserves may satisfy ore reserves reporting code requirements to be economic, this does not imply that they are optimal. Often, a proportion of the quoted reserve reduces the potential value of the operation. Metal price increases, increased production rates, and operating cost reductions are all seen as conditions or actions that can improve value, and lead to cutoff grade reductions, thereby increasing ore reserves. However, modern cutoff theory and studies conducted by the author and his colleagues show clearly that, while breakeven cutoff grades will fall in these circumstances, optimum cutoffs may be much less volatile, and may even increase. Results from case studies indicate that value is maximised by right-sizing, not maximising, the production capacities, and by optimising the cutoff strategy. Values of many existing underground mining operations can be increased significantly by a substantial cutoff grade increase. Also, an increase in downside risk, and hence reduced returns, can occur using typical life-of-mine planning strategies if prices received are lower than predicted. Since this is often the case, low industry returns may be a direct result of typical strategic mine planning processes. Relatively simple cost-effective techniques are available to provide senior decision makers with information needed to assess the tradeoffs between their many conflicting corporate goals, and the balance between risk and reward. Often this information is not being generated at all. If it is, decisions affecting the value of the company are occurring by default at relatively low levels within the hierarchy, with senior executives apparently unaware of them or their potential impact. The paper concludes that without a re-evaluation of the way mining projects are valued, to demand proven value optimisation from mining plans by boards and mining analysts, the industry will continue to deliver below average returns.

May 1, 2003