Operating Cost Budgets for Mines

Introduction The Mine Manager or Superintendent is a man faced with a difficult problem. He must direct the activities of his mine in such a manner that, over a period of time, the greatest possible profit will be realized. In this respect, a mine is no different from any other business organized for profit. What makes the mine manager's task so difficult then? The profit of a mine is determined by -among other things -the grade of ore, the market price of the metal or metals produced, and the cost to operate the mine. The mine manager cannot do much about the first two of these, but he has considerable control over the operating cost. This cost will depend in large measure on the nature of the programme on which he plans to operate his mine. This operating plan may be broad or specific, on a long-range basis or on a month to month basis. The development of the plan, however, is made very difficult by the existence of so many factors which must be considered. These may be (1) factors requiring decisions based on the best judgment and interpretation of engineering and geological information available, or (2) items which must be considered but which are largely non-controllable. To be more specific, examples of such items would be: (1).-(a) The amount and type of development work to be done in relation to amount of ore to be mined. (b) Mining methods to be followed and type of equipment to be used. © Amount of exploration diamond drilling to be done if the orebody is not clearly defined. (2).-(a) Rock type and degree of hardness. (b) Width, depth, and pitch of veins. © Amount of work requiring timbering. (d) Faults encountered. (e) Water and gas conditions met with.