Heap Leach Or Mill Economic Considerations In A Period Of Stable Gold Prices

Until recently, the general expectation among mining compa­nies and financial analysts has been that the price of gold would remain on a generally upward slope. The recent drop in the price of gold has caused many people to re-think the issue. Of course, the price of gold is singularly difficult to predict, so it is difficult to tell which concept is correct. In the present financial situation, however, many junior gold companies are faced with the reality that money is hard to raise, and many senior gold companies find that they are facing a period of corporate losses even though they own solidly producing mines, As engineering consultants, Kappes, Cassiday has recently received several requests to review conventional milling projects to see if heap leaching is a more viable option. In regard to straight financial criteria such as return on investment and net present value, the question is usually fairly easy to answer. However, corporate decisions must often be based on less definable criteria. For instance, new stock issues tend to be more successful if they are larger, which tends to favor milling operations over heap leaches. The corporate issues are often subjective and difficult to generalize about, so I will con­centrate in this paper on a few financial concepts.