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By G. J. Birnie

Introduction The preparation of the following paper has been undertaken in the belief that a description of the development methods and equipment used at Lake Shore, at the present time, will prove of general ? interest. Working depths of nearly a mile and a half in shaft sinking and of more than one mile for stoping operations have imposed problems not encountered at shallower horizons. Among the problems contributing to the difficulty of mining at extreme depths might be mentioned: Rock pressures Ventilation Hoisting Shorter work period at the face Geological considerations In the main, the effects of these factors add to the difficulty of mining at depth, but it is not entirely true to say that each must necessarily become more pronounced as mining operations proceed to greater depths. Corrective measures may, in some cases, retard the effect and in others may even relieve some of the difficulty. It is proposed here to discuss these features in the light of the experience at Lake Shore, and to present, in some detail, the current practice in shaft sinking and in driving ore and waste passes, raises, drifts and cross-cuts.

Jan 1, 1950

By Frank W. Cole, Sharanjit S. Dhillonn

A new method has been developed for calculating flowing bottom hole pressure in a gas well, using as a basis the general energy equation. Fundamentally, the method shows that a plot of flowing pressure versus depth for a gas well can be represented as a series of incremental .straight lines, with the accuracy in-creasing as the number of increments increase. It is shown mathematically that for most cases the slope of the flowing pressure versus depth curve is essentially constant, in which case a single calculation based on surface conditions will yield acceptable results. In all cases studied no more than two iterations were required for very good accuracy, and in most cases only one iteration was necessary. Several example calculations are shown and the results are compared to other commonly used methods of calculating bottom hole pressures These examples show that the method provides answers which are at least as accurate as other methods usually used, and results in a considerable reduction in computation time.

Jan 1, 1960

By George A. Lawrence, J. C. McHardy

"Field operating experience with an improved flotation mechanism for handling various flotation applications is covered in this paper. Some aspects of designing flotation machines are also presented. Operating data from extensive testing of commercial size equipment under actual plant operating conditions in the following applications is detailed:1. Copper Flotation2. Fine Coal Flotation3. Base Metal Sulfide FlotationDesign features, design improvements, modifications tested, and overall performance data are reviewed. Some mecl1anical performance data as well as metallurgical performance results are presented. Some comparisons with conventional flotation equipment are reported in this paper.Flotation sizing theories are reviewed and an actual equipment selection ex2.mple is presented. Scale-up criteria used for developing large cells are briefly covered.The paper concludes with a brief review of anticipated future flotation equipment design needs. IntroductionThe mining/milling industry is faced with increasing pressure to cut costs while maintaining product quality and indeed, in some instances, expanding production. For copper, nickel, iron, molybdenum, lead and zinc sulphides, coal, phosphate and some other minerals;, flotation remains the primary method of concentration and recovery of the valuable mineral away from the gangue. Cost reduction in flotation can be broadly focused on two areas:1. Flotation Chemicals2. Flotation Equipment"

Jan 1, 1985

By A. Rodriguez-Prado, R. L. Legge, W. C. Lennox

ABSTRACT It is possible to adequately describe chemical reduction of hexavalent chromium, Cr(VI), in industrial and mining wastewater in constructed wetlands by applying different kinetic models (e.g., halforder, second-order). Accounting for hydraulic transport of contaminants in reduction equations can also improve such description. The authors developed an explicit advection-dispersion bulk flow equation and applied it to model Cr(VI) reduction in laboratory wetland mesocosms. The results indicated that the model adequately described wetland exit Cr(VI) concentrations and Cr(VI) reduction, representing an improvement over the commonly used graphic method and potentially improving the wetland design.

Jan 1, 2014

By Xuanxue Mo, Kaihui Yang

"Abstract- The Laochang mine, located in the Sanjiang area of southwestern Yunnan Province of China, is a volcanogenic massive Pb-Zn-Cu sulfide deposit. It is hosted by a pyroclastic sequence of Barly Carboniferous age, namely the lower member of the Yiliu Group, which was intruded by syenite and rhyolite porphyry . The volcanic suite is basaltic or basaltic-andesitic in composition, has alkaline affinities, and is associated with the initial rifting along the margin of the Baoshan-Shanstate continental rnicroplate (Yang, 1989). The ores are typically Pb>Zn>Cu in composition, averaging 3.820Jo Pb, 3.51% Zn, from 0.01% to 1.85% Cu (0.107% av.), a high average content of Ag (113 g/t) and recoverable amounts of Au, Tl, Gd, Ga, Ge, In. A massive sulflde zone, in which lenticular and stratiform orebodies are localized in a sulflde-carbonate-silica shale unit or sulfldic tufflte horizon that usually overlies coarse-grained pyroclastic rocks, is underlain by a stringer sulflde zone developed in a subvolcanic intrusion or volcanic sequence. The sulfide mineral assemblages, from the top to the bottom of the deposit, are: realgar + orpiment - galena + sphalerite + pyrite- chalcopyrite + pyrite + pyrrhotite + arsenopyrite. Oxide and sulfate minerais occur rarely in the massive ores. The massive ores are generally fine-grained and banded, but coarse-grained ore, colloform and framboidal texture, and growth-zoned pyrite and sphalerite are common. Sedimentary features such as graded bedding, brecciated and deformed ore clasts, and chaotically emplaced blocks, are well preserved, indicating that the massive orebodies have undergone slumping and dis­ placement. Alteration is weak in the hanging-wall rocks, but strong in the stringer zone. Two dis­ tinctive alteration zones have been identified: the upper zone, characterized by an assemblage of quartz, carbonates, chlorite, albite, zeolite and sericite, and the lower zone containing diopside, trema­ lite, actinolite, gamet, clinozoisite, and epidote.The general features of the Laochang deposit are in accord with the descriptive mode! of VMS deposits (Lydon, 1984). However, it falls into neither the Zn-Cu group nor the Zn-Pb-Cu group chemically (Franklin et al., 1981). The depositional setting of the Laochang deposit is quite different from Cyprus or Besshi-type massive sulfide deposits. Laochang is hosted by alkaline lavas that were erupted in a submarine continental rift. Although some features of the Laochang deposit are similar to those of Kuroko-type deposits, there are remarkable differences in the alteration mineral assemblage, the proportion of ore-forming elements (lead enriched) and the amounts of oxides and sulfates. These suggest corresponding differences in ore fluid composition and the associated ore-forming environment. Thus, the authors suggest that the Laochang deposit may be a distinct type of VMS deposit."

Jan 1, 1993

By A. Vien, B. C. Flintoff, R. P. Edwards

"This paper provides a critical review of the development and application of advanced controls in mineral processing at the industrial level. These algorithms can be sub-divided into four broad categories: Kalman filter, self-tuning, extended horizon, and knowledge based or expert systems. Applications from each category are described outlining the benefits derived, the relative advantages of that particular controller, and potential limitations of the controller which may inhibit their more widespread application. The paper will conclude with a description of control algorithms which are currently in the rudimentary design stage, but may hold tremendous potential for mineral processing control systems in the next decade. INTRODUCTIONThe Canadian mining industry has a large installed milling base and many plants are run with manual or low level automatic process control. The competitive pressures imposed by the market will not allow these operations to ignore the significant increase in efficiency that can be achieved through the effective application of advanced process control. These improvements will come in the form of better quality, higher productivity and reduced costs.There have been quite a number of reports of successful applications of advanced control in mineral processing applications. As this trend continues, and more of the work is documented, the technology will be more effectively transferred to process and control engineers. It is the authors' opinion that the most difficult problems facing process control are not really technical in nature. Rather, they lie more in process control education. This extends from management, through engineering to the operators.The purpose of this paper is to provide a tutorial type overview of some of the more frequently encountered advanced control algorithms. The assumption is that the reader has a superficial knowledge of this technology. In the discussions which follow, several techniques are explored within the framework of simple process examples. Industrial examples are cited for each and an evaluation of the expected longer term potential is given."

Jan 1, 1992

By André van Wageningen

Since the beginning of this century Boliden Mineral and Atlas Copco have worked together in stages on improving the accuracy and quality of drilling. Navigation of the drill rigs with IREDES has been in use in the Boliden mines for several years. Recently the capability of the system has extended with map navigation to more accurately follow the ore in cut&fill mines. The system allows for changes on the individual round level to follow the ore without changing the whole design for the heading. Those changes are done in a CAD-system and remove the need for face markings and will allow for even better accuracy in both height and wall position. All the information between the CAD-system and the drill rigs is exchanged using the IREDES standard. This paper describes the workflow and the use of the IREDES standard.

Oct 1, 2009

By Z. Xiao, A. R. Laplante

"The recovery of gold by gravity from grinding circuits differs from virtually all other gravity recovery approaches in that stage (or unit) recoveries are low, typically 1 to 5%, but overall recoveries are generally in the 25 to 60% range, because individual gold particles are presented many times to the primary recovery unit. Full-scale recovery is difficult to predict from benchscale tests. Further, maximizing metallurgical recovery is generally not the primary objective, because of the more efficient downstream recovery circuit (flotation or cyanidation). In this paper, a new concept, the gravity recovery effort, is presented to assist in the design and optimization of gold gravity circuits. It is defined as the product of the circulating load treated by the primary gravity unit, the recovery of this unit, and the gold room recovery. Predicted gold recovery is linked to the recovery effort, the size distribution of gravity recoverable gold (GRG), the dimensionless retention time in the mill and the partition curve of GRG. A case study of economic optimization of the gravity recovery effort is presented. INTRODUCTIONPredicting gold gravity recovery from grinding circuits has always been a hit-and-miss exercise. The problem can be traced to the highly variable gravity recoverable gold (GRG) content of ores, high GRG circulating load, fraction of the circulating load treated, and performance of primary gravity recovery and gold room. Typical values, highs and lows are shown in Table 1."

Jan 1, 2001

By D. Komljenovic, E. Lafontaine, J. Paraszczak

Availability of the production equipment used in underground mines has a substantial impact on production costs and, thus, on mine profitability. Appropriate collection of pertinent data and information, as well as use of adequate performance measures and their analyses, can help mine operators identify cost-effective opportunities to improve equipment availability. This paper presents study results aimed at reviewing and analyzing means and measures used to quantify equipment availability and its contributing factors (reliability, maintainability and maintenance support) in several Canadian underground mines. It overviews sources, as well as quality and quantity of relevant data and information, and examines performance measures and their definitions, as applied to surveyed mines. Problems concerning data acquisition and meaningfulness of the performance measures are discussed. The paper concludes with some suggestions and recommendations concerning several aspects of equipment availability assessment. Evidence suggests that the latter may become a more useful tool for mine operators in their efforts to reduce production cost.

Jan 1, 2008

By Jacek Paraszczak

L?exploitation rentable des gisements de type filonien constitue un problème important dans le contexte actuel de l?industrie minière québécoise. Les études effectuées depuis 1994 ont indiqué, que la technologie d?abattage mécanique utilisant l?outil hydraulique appelé « éclateur radial-axial » constitue une alternative intéressante par rapport aux méthodes conventionnelles par le forage et sautage. Les essais du prototype de l?éclateur ont prouvé qu?il est en mesure d?abattre les roches dures dans un environnement minier, mais sa performance dans les termes de masse du roc abattu dans une unité de temps a soulevé certaines doutes. Pour cette raison, une étude de préfaisabilité de l?éclatage en tant qu?une technologie d?excavation souterraine a été réalisée. Cet article présente quelques résultats des travaux effectués dans le cadre du contrat octroyé à l?Université Laval par le Ministère des ressources naturelles du Québec. Leur objectif principal consistait à comparer, pour les conditions des gisements filoniens, la productivité et les coûts des méthodes d?exploitation souterraine utilisant l?éclatage par rapport à celles conventionnelles. Deux variantes proposées de cette méthode ont été comparées avec la méthode conventionnelle sur le plan du coût (par tonne de minerai) et de la teneur de coupure de minerai d'or. Les études ont démontré que l?application de l?éclatage représente un potentiel de réduire ce coût, surtout dans les situations où l?abattage sélectif pourrait avoir lieu. Pour le cas de base on a trouvé, qu?il serait possible de réduire la teneur de coupure par la marge d?environ 16 ? 26%. Toutefois, les études de sensibilité ont démontré, que le coût dépend de façon important de la productivité d?éclatage, qui, pour sa part, varie beaucoup en fonction de paramètres du massif rocheux devant être abattu.

Oct 1, 2001

By K. Loutet, A. Guenkel, K. Nikolaisen

"The INCO SO2/air process was patented by INCO in 1985. Well over 80 mining operations worldwide are using this process to oxidize cyanides to cyanates in the tailings from gold, silver and copper mining operations. The sulphur dioxide (SO2) for this process can be supplied either as liquid SO2, SO2 gas or as a sulphite-based salt. The majority of SO2/air operations have used sulphite-based salts as the ‘SO2’ equivalent probably due to low capital cost. Liquid SO2 has also been used frequently, but due to concerns with safety and availability, this option is often not preferred. The solid salt sodium meta-bisulphite (SMBS) is commonly employed, but its cost is an order of magnitude higher than that of sulphur. Due to the high cost of SMBS, the increased capital cost for a sulphur-burning SO2 gas plant (green field or retrofit) usually has a pay-back of less than three years. In addition, a SO2 gas plant offers potential for significant heat recovery from the sulphur burning process. In terms of safety, the SO2 gas plant only requires the storage of relatively benign sulphur and the site inventory of SO2 will be limited to the plant gas volume. Therefore, a SO2 gas plant will not trigger the Canadian Environmental Protection Act (CEPA) E2 Regulations or the US Clean Air Act Section 112(r) accident prevention regulations, as may be the case for liquid SO2.Most existing mining operations using ‘SO2’ are gold operations, but in recent years there has been an increased interest in larger sulphur dioxide gas plants for hydrometallurgical facilities that employ leaching of cobalt/manganese minerals or precipitation of manganese/iron (e.g. Tenke Fungurume and El Boleo).This paper focuses on the production of sulphur dioxide gas generated on site and on demand for the use in hydrometallurgical processes. The capital and operational costs of a SO2 gas plant is compared to conventional process alternatives using sulphite-based salts or liquid SO2."

Jan 1, 2016

By H. U. Ross

ROASTING is usually thought of as a process in which finely crushed or ground ore is heated with air in a suitable furnace in which the ore is rabbled or agitated in such a way as to insure complete reaction between the oxygen of the air and the oxidisable constituents of the ore. Roasting in this sense is used only to a very limited extent in the iron and steel industry. This is because, in most iron ore deposits mined today, the ore is of a type that does not require roasting. Where this process is used, it is usually because of some special circumstance, such as a peculiar economic condition, that warrants it. If roasting is looked upon in the broader sense as a gas-solid chemical reaction carried out at an elevated temperature in which both gaseous and solid products are formed, then the process is used in the iron and steel industry to a greater extent

Jan 1, 1961

A rough simulated borehole has been developed for the installation and dynamic testing of rock bolts a the WASM Dynamic Test Facility. The rough simulated borehole is used for rock bolts that are sensitive to equipment installation technique or borehole geometry (particularly friction rock stabilisers and resin encapsulated bolts). An extensive axial test program has quantified a difference between the static and dynamic capacity (kN/m of embedment) for friction rock stabilisers once sliding starts. The 47mm split tube bolt has a 50% reduction in embedment capacity (but with significant variation) dissipating 2.7kJ/100mm of sliding per meter of embedment, and the Omega (inflatable) bolt had a 70% reduction in embedment capacity dissipating 6.2kJ/100mm of sliding per meter of embedment. The Omega bolt dynamic capacity remainder at least equivalent to the split tube bolt static capacity.

May 1, 2009

By Polysius AG

"The Lone Tree demonstration was an important milestone in bringing High Pressure Grinding Roll (HPGR) technology into hard rock applications in the mining industry. HPGRs have become standard equipment in the cement, iron ore, and diamond industries over the past fifteen years, but their use in severe duties found in the hard rock mining sector has been restricted due to high roll wear and subsequent low availability. HPGR availability has historically been limited because of frequent downtime for edge weld rebuilding as the rolls wore and short tyre life from high roll surface wear rates.Recent advancements in HPGR wear protection are now being evaluated for commercial applications in the gold and copper mining industry where this technology may offer benefits in comminuting hard and/or abrasive ores and in improving metal recovery in heap leaching applications.Proving the feasibility of HPGRs for processing competent, abrasive gold ore, Newmont Mining Corporation, the world's largest gold producer, operated an HPGR demonstration plant employing a POLYSIUS (POLYCOM) HPGR incorporating some unique wear protection, at their Lone Tree gold mine near Winnemucca, Nevada. Results of the successful demonstration are presented and evaluated in this paper.The Lone Tree HPGR demonstration plant operated for three months, from April through June 2003. The HPGR operated for 1626 hours and processed 141,000 tons of ore. This technology demonstration focused on measuring operating performance, wear characteristics, and availability of today's HPGR technology.Polysius' innovative roll surface wear protection system eliminated edge-welding downtime. Improved surface wear protection extended tyre life to predicted durations acceptable for very abrasive service. The POLYCOM HPGR is now deemed suitable for selected hard rock applications."

Jan 1, 2005

By C. Derek Martin

"Predicting the ground response for tunnels in weak shales remains challenging. Predicting the ground response is challenged by difficulties in characterising the material, and our ability to predict deformations that are driven by coupled hydromechanical processes, when this material yields. The techniques that are used for characterizing weak shales are reviewed, and three case histories are examined that demonstrate the behaviour of these weak rocks during tunnelling. A general framework is provided for assessing the squeezing potential for weak shales.1 INTRODUCTIONGeologically, shale is an argillaceous fine-grained sedimentary rock that forms from the compaction of silt and clay-size mineral particles commonly referred to as ""mud"". Because of this grain size, the material is generically classed as Mudstone (Figure 1). Shale is distinguished from other mudstones because it is made up of many thin layers (laminated) and readily splits into thin pieces along the laminations (fissile). While the geological classification of shale appears straightforward, the classification for engineering purposes is often confusing. Underwood (l967) provided the first description of shale that made the distinction between “soil-like” compaction shales and “rock-like ""cemented"" shales. He coined the term ‘clay shale’ to capture the characteristics of hard clay yet recognizing its origin as a shale. In this paper weak shale is synonymous with clay shale and have strengths that typically range from R1 to R2 (1 to 25 MPa). Characterising these materials draws on methods from both soil and rock mechanics."

Jan 1, 2015

By G. R. Morin, A. R. Leggett

"In 2010, closure of the Kidd metallurgical plants along with structural changes to the historical ratios of payable metals led to a review of the operating targets at the Kidd concentrator. Previous operating data indicated that there was potential for significant revenue improvements by lowering the copper concentrate grade. An extended plant trial was carried out in 2011 to quantify the revenue impact of lowering the copper concentrate grade from 27% to 25% Cu, as well as identifying the lower practical grade limit. Analysis of plant trial results indicated that the process change increased net concentrate revenue by $2 M to $3 M per year at current metal prices. Increased revenue was primarily associated with higher silver recovery to the copper concentrate while the marginally improved copper recovery was essentially offset by increased zinc losses and concentrate treatment and freight charges.Details of the plant test work results are discussed in this paper along with the financial analysis of the revenue improvements. Key areas covered are major revenue components of the concentrate contracts, validation of revenue improvements through plant testing and sensitivity of the improvements to market and plant variables.INTRODUCTIONThe Xstrata Copper Kidd concentrator commenced operations in 1966 treating ore from the nearby Kidd volcanogenic massive sulphide deposit in Timmins, Ontario (Thompson, Amsden, & Chapman, 1978). Over the years, up to four separate grinding-flotation divisions were in operation with throughput rates peaking at 4.5 million tonnes per year of ore in the mid 1980’s (Kelebek & Francis, 1998). As the mine production decreased and grinding throughput increased operations were gradually cut back and since 1998 two grinding-flotation divisions have been in operation treating Kidd mine ore. One of the idled divisions has been intermittently used for custom milling operations, most recently the Ni/Cu Montcalm deposit, which was milled from 2004 to 2009. Current budget throughput rates, limited by mine production, are 2.4 million tonnes per year of ore grading 1.7% Cu, 4.3% Zn and 55 g/mt Ag. Concentrate production rates are 150,000 tonnes per year of copper concentrate and 155,000 tonnes per year of zinc concentrate. The Kidd mine is the deepest base metal mine in the world with mining operations down to 9600 ft.In 2010 the copper and zinc plants at the Kidd metallurgical site, which previously treated the concentrate production from the Kidd concentrator, ceased operation due to a variety of economic and market factors. Following the metallurgical plant closures the Kidd concentrator products were shipped off site for treatment. The majority of the copper concentrate is now processed at the Xstrata Copper Horne smelter in Rouyn-Noranda, Quebec with the majority of the zinc concentrate processed at Canadian Electrolytic Zinc Ltd. in Valleyfield, Quebec."

Jan 1, 2013

By Tim Hughes, A. H. (Sandy) Gray, Jennifer Abols

"The selective recovery of gold and silver from solutions containing other metals such as copper is possible using AuRIX®100 resin in conjunction with the Gekko Resin Column. Selectivity is driven by controlling the solution pH, which enables activities such as loading copper, gold and silver and then selectively stripping copper before gold and silver. Alternatively gold and silver can be loaded and the copper left in solution. The selective loading of gold while reducing the silver loading has also been demonstrated opening the possibility of producing high grade gold doré from high grade silver pregnant leach solutions. This paper reviews the AuRIX®100 resin and Gekko Resin Column Technologies, discusses the uses of AuRIX®100 in the recovery of gold and silver and the chemistry relating to several projects for which AuRIX®100 is being tested.INTRODUCTIONGekko SystemsGekko Systems specializes in the design, development and distribution of innovative mineral processing equipment and systems with a particular focus on gravity separation for the gold and diamond industries. The company, which has been around since 1996, has five main products: the InLine Pressure Jig, the InLine Spinner, the InLine Leach Reactor (ILR), Gekko Resin Column and Modular Systems.The InLine Leach Reactor is an intensive cyanidation reactor that uses high cyanide (0.5 – 2 % NaCN) and high oxidant (20 ppm dissolved oxygen as O2 or hydrogen peroxide) to dissolve gold from medium and high-grade gravity or flotation concentrates. The ILR, which typically replaces a shaking table in the gold room, is available in both batch and continuous models. There are 42 installations worldwide. Further details on this technology can be found in papers written by Gray et al (2003) and Longley, McCallum and Katsikaros (2003). By replacing a shaking table with an ILR, the overall gravity and plant recoveries can be increased significantly. Other advantages include reduced security risks, lower operating costs, reduced operator involvement due to the automatic process and increased safety for gold room operators."

Jan 1, 2006

"Drilling twinned holes is a traditional technique used for verification of intersections of high-grade mineralization, testing of historic data, or confirmation of drillhole data during geological due diligence studies. Twinned holes can also be used for special tasks such as correcting earlier data that are recognized to be biased. Successful implementation of the twinned-holes technique requires thorough planning. Experience suggests that good practice is to drill twinned holes no more than 5 m apart. Many unsuccessful twinned-holes programs could possibly have failed because the twinned holes have been drilled too far apart.Twinned holes are best compared by mineralization intersections and, if the data and geological characteristics of the deposit permit, by samples, equal-length composites, or geological units. Variables to be verified by twinned holes should include the thicknesses of the geological units of interest (e.g., mineralized thickness) as well as the presence of significant geological features (e.g., ore/mineralization contacts, alteration, etc.).A formal, rigorous analysis of twinned-hole data is essential. Repeatability of sampling, analytical results, and bias must be analyzed and statistically quantified. The number of twinned holes required for conclusive statistical and geostatistical analysis can be as high as 20-30, in particular where the studied variables are characterized by high short-range (local) variability.The efficiency of this approach is demonstrated by several examples of successfully applied twinned-hole projects, including applications to orogenic gold, mineral sands, bauxite, and iron ore deposits."

Jan 1, 2009

By Bruce Mennie

PT Freeport Indonesia (PTFI) operates copper and gold mining operations in a mountainous area of the Mimika regency, near Tembagapura, Papua (formerly, Irian Jaya), Indonesia. The mining and concentrating operations typically produce 240,000 metric tonnes per day of Copper and Gold ore from the combined mining of an 80,000 tonne per day (ore) block cave operation (DOZ Mine) and a 160,000 tonne per day (ore) open pit mining operation (Grasberg Open Pit). The Grasberg Open pit mine will be complete in 2016 at which time PTFI?s operations will convert to Underground. Mining operations will transition from today?s mixed surface and underground operation to full underground mining over the next 6 years. This paper reviews the history of Redpath?s relationship with PTFI, beginning with a raiseboring contract in 1981 and evolving into vertical and horizontal development contracts of up to 37,700 equivalent metres of lateral development and 4,000 metres of vertical development in 2011. An overview of the current operations (PTFI?s Grasberg Open Pit and DOZ Underground Mines) and transition period (challenges for the transition from current to future underground mines) is presented with details of development of common underground infrastructure and future mines; Big Gossan Mine, DMLZ Mine, Grasberg Block Cave Mine, and the Kucing Liar Mine.

Oct 1, 2010

By L. D. Smith

Net Present Value Impact of Discount Rate The Discounted Cash Flow (DCF) method of valuations is universally used and accepted. The main criticism of the method is that it does not recognize the value of projects long life projects. This can be seen in the preceding graph where the present value of cash flows in later years are small for discount rates over about 10%. This graph covers a project that has a 25 year operating life. It is clear from the low height of the NPV bars at 10% and 15% in the last years of the project that an additional 25 years would add almost no value to total project NPV. As an example of this effect, an colleague undertook the evaluation of a pulp and paper project. The plant could be justified, but it was not possible to justify planting the trees as they took too long to grow and so had not appreciable NPV. The plant had to purchase wood to feed the plant.

May 1, 2013