A statistical approach to some basic mine valuation problems on the Witwatersrand - Introduction

The estimation of the tonnage and grade of payable ore in a mine and the correct policy of selective mining based on such estimates, is of vital importance to the mining engineer it is surprising, therefore, that more attention has not been devoted on the Witwatersrand to the scientific improvement of mine valuation methods. At present these methods consist almost entirely of the application of simple arithmetic and empirical formulae guided by practical experience, and ignore the many advantages to be gained from a careful statistical analysis of the behaviour of the gold values. The science of statistics has expanded rapidly during the last two decades and its value as a powerful and indispensable tool is now recognized not only by research workers and scientists but also, ever-increasingly, by the commercial and industrial world. This being the case it is noteworthy that in a mining field such as the Rand with its highly developed and advanced mining methods, singularly little attention has been paid to the analysis of mine valuation problems on a modern statistical basis. This omission is even more striking when cognizance is taken of the wealth of sampling data concerning the gold ore which is available and of the far-reaching decisions and deductions constantly being based on such data. Some contributions have however been made from time to time towards the application of statistics to mine valuation on the Rand (References Nos. 7, 8, 9, 11, and 12), but none of these have been generally applied in practice and a systematic practical approach based on clearly deemed fundamental concepts still appears to be lacking. The object of this paper is, therefore, to define these statistical concepts and to indicate briefly the lines along which statistical methods can be applied profitability in solving some of the existing problems and in improving the general standard of mine valuation on the Rand For this purpose a knowledge of mathematical statistics is essential, but as this paper is primarily intended to provide the mine valuator with a practical introduction to statistical application in his field, the mathematics is confined to a short annexure, together with references from which details can be obtained.