ore 330 mineral and energy resources of the · pdf filenodules crusts metal copper nickel...
TRANSCRIPT
Mineral EconomicsKey Metals In Order of Economic Importance:
Mn Nodules – Ni, Cu, Co, Mn
Mn Crusts – Co, Mn, Ni, Pt
Profit = Sales – Cost
Normally this profit is calculated as a percentage of the investment and is referred to as internal rate of return (IRR)
For high risk ventures such as mining this needs to be on the order of 20‐30%
Costs
Primary costs are in two categories:
Capital costs: buildings, ships, machinery, etc.
Operating costs: supplies, labor, energy, etc.
Sales
Major metals are sold on metals exchanges – key examples:The London Metal Exchange and the New York Commercial Exchange (COMEX)
Manganese and cobalt are sold on the internet and by direct contract with mines
Specifications for metals sold include: delivery date, location, lot size, grade, packaging, and technique of processing
Price Protection
Price volatility is one of the major metal market issues
Metals prices are hedged by futures and options
Futures contracts allow sales of metals now with payment and delivery up to 27 months in the future
Options contracts are a price insurance policy in part guaranteeing a minimum sales price
Project Economics Depend On:1) Quality and size of resource
2) Technologies
3) Markets
4) Capital & operating costs
5) Tax regimes & subsidies
6) Risks