Mine Project Economics

Mine Project Economics

Areas of Study: Management

Qualifies for CMS

Premium Peer-Reviewed

Qualifies for Certification

A comprehensive course for managers and professionals on revenue, cost, cash flow, discount rates, methods of financing, metal prices, metal contracts, uncertainty, modeling and real options in the context of mine project economics. *** This is a premium course which has been peer-reviewed by a committee appointed by the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) and the Society for Mining, Metallurgy and Exploration (SME).

Author:

Online Course Online Courses

Enroll for Access to All Online Courses

Enrollees have access to all self-paced online courses.

Certification available for Not Available
  • Audience Level:
  • Professional
  • Enrollment:
  • Required
  • Duration:
  • 18 hours

Course Summary

Introduction

A tenet of investment is that if the risks of an investment are high, then the investor should be compensated for assuming the risks by a high potential return from the investment. However, quite often the risks associated with an investment are not known or understood. The results vary but may include an investment evaluation that is not representative, a bad investment decision, and low returns or even losses. Inadequate technical or financial information is the main reason risks are not taken into account or are misunderstood. Unfortunately, lack of such information is a common situation in mining and other large industrial projects. No amount of investment evaluation or analysis can compensate for lack of information.

If the risks are known and can be characterized in some way, methods of investment analysis can be used to provide a quantitative assessment of the risks. One goal of this course is to describe methods for risk quantification, their advantages and limitations, and to give realistic (if not real) examples of their application. Fortunately these methods are simple so that complete evaluation of an investment is (or at least should be) a simple process.

Topics covered in this course include:

  • Revenues, Costs and Cash Flows
  • Discount Rates
  • Project Financing
  • Metal Prices and Markets
  • Mining Costs
  • Uncertainties
  • Real Options

Course Content

The course comprises 22 learning sessions, each of 30–60 minutes duration, plus supporting figures, tables, images, references, case studies, appendices, Excel spreadsheet examples and interactive reviews that confirm achievement of the learning objectives. The total duration of the course is estimated at 18 hours.

Learning Outcomes

  • Discuss revenue, cost, cash flow, discount rates, methods of financing, metal prices and metal contracts in the context of mine project economics.
  • Describe methods for modeling metal prices and mine costs, and their application to project economics.
  • Identify methods for risk quantification, their advantages and limitations, and their application to project economics.
  • Explain the definition and valuation of real options with respect to mine projects.

Recommended Background

  • Familiarity with the mining process.
  • A degree in either engineering or business.
  • Familiarity with spreadsheets and their application to financial modeling.

Dr. Scott Dunbar

From 1975 to 1996 Dr. Scott Dunbar worked for various engineering consulting organizations. His experience includes mining exploration, geotechnical engineering, mine design, design of tailings dams, water resources engineering and hydroelectric engineering. He has worked on projects in Canada, the United States, Central and South America, Iran, Africa, and China.

In January 1997, he joined the Department of Mining Engineering at the University of British Columbia (UBC). He has taught courses in Mine Economics, Mine Waste Management, Mine Design, Management Science, and Simulation. He was the founding director of the Integrated Engineering program, an undergraduate interdisciplinary engineering program with a focus on engineering design methods, teamwork in design, independent learning, and communication skills. He is now the head of the Department of Mining Engineering.

Scott's research interests are in advanced mining and mineral processing methods, and the basic question: what will a mine look like 50 to 100 years from now? In collaboration with members of the Centre for Blood Research and the Department of Microbiology and Immunology at UBC, he has been working on applications of biotechnology to mineral separation. He also does research in project economics, mining construction, and mineral processing.

Scott and his wife Petra enjoy skiing, hiking, cycling, and remodelling their house. Sons Blake and Camden and daughter Enja are a constant source of entertainment.

Education

  • High School: United World College of the Atlantic, Wales, U. K. 1965-1968
  • British Advanced Levels: Math, Physics, Chemistry, and French
  • B.Sc. Geophysics (Honours), University of British Columbia, 1972
  • M.Sc. Geophysics, University of Toronto, 1973
  • Ph.D. Civil Engineering/Geophysics, Stanford University, 1977
Membership

  • Registered Professional (Geophysical) Engineer in B. C., Canada
  • Canadian Institute of Mining and Metallurgy
Languages

  • English: fluent
  • Spanish: speak and read
  • French: read and understand