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By Steve Zaffron, Olga Loffredi, Eric Seedorff, Mary Poulton

"The New Face of Mining is a recognition of the central role of human beings in mining and the underappreciated power they can have in generating breakthroughs in business performance and shareholder value. The key is people creating, aligning on, and subsequently enacting the future of mining. A methodology that is effective creates a corporate environment for alignment to be possible and then transforms operations by embedding the necessary behaviors, processes and practices. The people within the organization then are empowered to find and to implement solutions quickly, as measured business results demonstrate in case histories of diverse mining challenges around the globe and over the decades.Urgent case for actionThe physics of mining does not change fundamentally over time, but the context in which it operates changes rapidly, periodically requiring a new face of mining. “The New Face of Mining,” which has been used as a metaphor for the campus-wide mineral resources research organization at the University of Arizona, has many facets, including societal, generational, technological, financial and environmental, but at the center, always, is humanity. The New Face of Mining is not necessarily about age, it is about people first imagining and then creating a new future for mining. The challenges facing the global industry evolve from year to year and differ in individual companies or mines at any one time.Quantified outcomes from case studies indicate that a methodology, now also offered annually in a four-day, open-enrollment leadership program tailored to the mining industry, is effective at generating breakthrough results in the mining business. Such challenges range from those with important technical components to others that are mostly social challenges. Our focus, however, is the centrality of people in aligning on and enacting the future of mining. We use the phrase New Face of Mining for leadership and ways to empower people in organizations that commonly are overlooked in the mining industry. Some of the material in this article is based on the ideas of Werner Erhard and on the book by Steve Zaffron and Dave Logan (2009), The Three Laws of Performance: Rewriting the Future of Your Organization and Your Life.At Davos, Switzerland in January 1992, nine visionary mining chief executive officers (CEO) gathered to create the Global Mining Initiative. Much has changed in the 26 years since that meeting:• The world GDP has increased from US$25.4 trillion to $75.8 trillion.• The annual number of U.S. patent applications increased from 186,000 to 629,000.• The number of websites has increased from 100 to 1 billion.• The number of academic references to artificial intelligence has climbed from more than 16,000 to more than 1 million.• The number of cell phone subscribers grew from 11 million in the United States to four billion globally."

Oct 1, 2019

By Leon Y. Sadler

Equations which predict the unsteady-state response of the continuous froth flotation cell to changes in operating conditions are necessary for the rational design of an automatic flotation cell control system. Unfortunately application of automatic control to froth flotation separation equipment has lagged behind application to other types of separation equipment (for example distillation columns, absorbers, liquid-liquid extractors, etc). This may be due partly to the unavailability of suitable mathematical models for predicting the dynamics of continuous mechanical froth flotation cell. This paper presents the results of a comparison of four dynamic flotation models (in transfer function form) using the same set of unsteady-state continuous flotation data. One of the transfer functions tested has been presented previously in the literature (1), another (2) has been accepted for publication, and two are given here for the first time. In addition, data are presented which confirm earlier findings that the mixing in the rotor-stator type cell is nearly perfect. The specific purposes of this paper are to: (1) provide the automatic control systems designer with several alternative dynamic mathematical models of the continuous mechanical froth flotation cell (2) give some idea of the relative a¬bility of each model to predict unsteady-state behavior by fitting each model to the same set of experimental stimulus-response flotation data and (3) provide more insight into the macro-mechanisms prevailing in the continuous mechanical flotation cell. The dynamic models which are presented and tested here all relate the time variation of the concentration of a given floatable mineral in the tailings to a time-dependent disturbance in the same floatable mineral concentration in the feed to the flotation cell.

Jan 1, 1972

By D. Symonds, A. J. Richins, M. G. Nelson

Mining activities at Kennecott and Park City are similar in that both districts began operation in the last half of the 18th century, and both operated on a large scale for many years. However, they are different for two important reasons. First, the mines in the Park City district were always underground. The city of Park City was above many of those mine workings. It remained in place after mining activity stopped, and as the town became an up-scale ski resort, property values increased and the tailings dumps became desirable building sites. In contrast, Kennecott eventually became an open pit mine, and the growing pit effectively consumed many of the small towns that had grown up around the underground workings. Even towns on the periphery of the open pit were razed to allow for the disposal of mine overburden. Second, almost all mining activity stopped in Park City in the early 1970s, just as the first rigorous environmental legislation in the United States was enacted. (The Ontario mine operated sporadically until 1982.) Many mine structures, waste dumps, tailings ponds and piles, and tunnels were simply abandoned as the mining companies ceased business or were bought out. Kennecott, on the other hand, has been in continuous operation for more than 120 years, so a closure plan hasn’t been finalized. Nonetheless, environmental and social problems have arisen, and the company has had to address them.

Mar 2, 2022

"INTRODUCTION In recent years, there has been increasing focus on environmental and social impacts of the extractive industries, climate change and resource scarcity. The concept of the circular economy aims to replaces the “take-make-dispose” economic model with one that eliminates waste of all kinds and is restorative by design. Such closed-loop systems implicitly aim to reduce the quantity of primary extracted materials entering the economy, thereby affecting supply and demand dynamics, hence mining industry economics. For the metals industry, the ability to engage in, or adapt to the circular economy can be heavily affected by industry structure and geographical factors. Eco-efficiency initiatives that reduce waste and environmental impact may help the mining and metals industry align with some of the goals of the circular economy. This paper focuses on base metals, and explores case studies in copper, lead and zinc. It analyzes primary and secondary metal production, and recycling. It examines company structures and how these affect engagement with the circular economy. CIRCULAR ECONOMY PRINCIPLES Ellen MacArthur Foundation (2012) describes the circular economy as “an industrial system that is restorative or regenerative by intention and design”, which “replaces the ‘end-of-life’ concept with restoration”, and “aims for the elimination of waste through the superior design of materials, products, systems, and, within this, business models”. The concept is systems focused. For materials such as metals, a series of loops are considered, including maintenance of devices, reuse, refurbishment and recycling. Potential methodologies to achieve circular economy outcomes include disassembly and reassembly of manufactured goods, leasing rather than buying major appliances, and converting to renewable energy sources. The circular economy is partially aligned with the principles of eco-efficiency, which relate to reducing the environmental impact per unit of a material produced. PRIMARY AND SECONDARY METAL PRODUCTION Base metals (copper, lead, zinc and nickel) are essential ingredients in modern economies and are key commodities produced by the global mining industry. Metal production can be categorized as primary or secondary. Primary metal comes from the processing, smelting and refining of metal content extracted from ores, while secondary production comes from metals recovered from recycled streams (e.g. recycled lead-acid batteries, copper wire scrap, etc.). Metals are stored in natural, anthropogenic in-use and anthropogenic waste stocks. An example of the stocks, flows and processes associated with global copper extraction and use is shown in Figure 1."

Jan 1, 2018

By Tony S. Calayag

Throughout the mining industry today, new bearing materials - ZA* high-performance zinc-aluminum alloys - are reducing costs of maintaining and rebuilding a wide range of equipment. As replacements for bronze bearings, installed in original equipment at the plant or during maintenance and repair operations in the field, the zinc alloys frequently provide better or equal performance at lower cost. The ZA Alloys The ZA alloys are a family of three high-performance zinc-aluminum alloys that compete in cost and performance with cast iron aluminum and bronze. The growing number and uses testifies to the versatility of these alloys and is encouraging their consideration in a wider range of applications. The ZA alloys are referred to as ZA-8, ZA-12, and ZA-27, the numbers corresponding approximately to the percentage of aluminum each alloy contains. ZA-8 is a permanent-mold casting alloy and is usually selected for decorative purposes; ZA-12 provides both performance and cosmetic benefits; ZA-27 offers the greatest functional strength. The term high performance ZA alloys distinguishes them and their improved engineering properties from traditional zinc die casting alloys. Maintenance Savings At its mine in Timmins, Ontario, Kidd Creek Mines Ltd. operates over 40 Joy VCR- 150 crawler-mounted air-powered rock drills. Most of the drill components undergo severe stress as the drill batters through the under-ground rock. As the components wear, the drill bits wobble; when the wobble becomes excessive, the drills are rebuilt. In the gear train, which rotates the drill steel, there are three planetary gears with - historically - bronze bushings. Since the planetary gear bushings are wear items, they are routinely replaced during overhaul. The bronze planetary gear bushings (three bushings per assembly) were replaced up to five times annually. With 43 drills in use, bushing consumption approached 600 per year. At the manufacturer's replacement part cost, the 600 bushings and gears would cost more than $20,000 a year. Even though a major saving was achieved by having the bronze bushings manufactured locally, the 600-unit annual usage provided ample incentive to investigate other ways of lengthening drill life and reducing the part costs. One approach was to consider using a bushing material that offered good bearing properties, but was lower in cost. About three years ago, ZA-12 zinc-aluminum casting alloy, costing less than half as much as bronze, was evaluated and selected for testing. One hundred ZA bushings were manufactured and placed in service as the drills came in for rebuilding. At the next rebuild the "drill doctor" (drill maintenance mechanic) noticed that, although the bronze bushings were completely destroyed, on occasion the zinc alloy bushings were not. In addition, he noted that some of the ZA bushings showed less wear than the bronze bushings. Because the bushings were changed routinely during each overhaul, the actual operating life of each bushing was not determinable. Therefore, it was not possible to statistically compare the life of the ZA bushing against the bronze. However, the desired life of the part was from overhaul to overhaul. So the ZA alloy obviously met the objective, giving equal or better life than bronze at a significantly lower price. Based on the favorable results of the testing under actual operating conditions, Kidd Creek maintenance personnel decided to switch permanently to the ZA bushings for rebuilding the VCR-150 rock drills. Original Equipment Application As one of the leading companies marketing the ZA alloys, as well as a zinc -copper-silver mining company, Kidd Creek is interested in developing applications for the alloys by original equipment manufacturers such as joy Manufacturing. Kidd Creek marketing representatives provided joy with information on the Timmins mine tests, along with ZA-12 bushings for evaluation and testing. Based on this information, joy installed ZA bushings in 12 new VCR-150 units and delivered them to customers for use in such areas as granite quarries and copper, lead, zinc, and limestone mines. During the following year, joy engineers closely monitored repair reports to verify the performance of the ZA part. The engineers' findings convinced them of the advantages of ZA-12. As a result, joy now uses ZA-12 bushings in the manufacture of its VCR-150 air tools. Advantages for Casters and Users In the foundry, the new alloys have proved their castability and profit potential in sand and metal permanent-mold processes, as well as the new graphite permanent-mold gravity casting process. The energysaving, pollution-free and ease-of-machining benefits they offer are important to all of these processes. Most recently, the high-performance alloys entered the arena of cold-chamber die casting, where they provide properties beyond those of

Jan 7, 1983

By O. Ditsele

Coal plays an important role in the energy needs of the World. Given its wide abundance and low cost, coal use is bound to increase with the growing energy demand. Despite its importance, there are growing concerns over coal?s environmental burdens, especially its contribution to greenhouse gas emissions. To ensure sustainable extraction and use of coal, opportunities for minimizing potential impacts from coal have to be identified and exploited. Whilst extensive work has been done on life cycle assessment of coal use, especially in electricity generation which uses the bulk of coal produced, there has been limited work focusing specifically on coal mining. This study aims to estimate the cradle-to-gate life cycle climate change impacts of coal from a surface coal mine in the United States. The study employs general principles of ISO standards for LCA.

Jan 1, 2010

By MAHESH SHRIWAS, CHRISTOPHER PRITCHARD

Ventilation monitoring and control in mines are becoming an integral part of day-to-day activity for maintaining health and safety of miners. The authors evaluate potential real-time monitoring solutions for detecting and reducing diesel particulatematter, mine fires, and dust in situ, and examined the state-of-the-art use of ventilation monitoring and control in underground mines for detecting and reducing air contaminants to acceptable regulatory limit. Authors review relevant documents, including research papers, trade publications, and manufacturers’ website-based information, to identify research gaps. The authors also evaluate contemporary sensors (airflow, gas, dust, silica), control system and software technologies, data transport systems, Industrial Internet of Things, ventilation network simulators, and control devices to identify potential health and safety research gaps. In this study, examples of some mines from Canada, Australia, and the USA are included where ventilation monitoring and controls have been applied. Overall, this review identifies multiple challenges and research gaps in applying mine monitoring and control systems that could be the focus of future research, offering potential improvements to miner safety and health and financial benefits.

May 12, 2020

By Carlo Sampaio, Moacir Veras, Aaron Young, Carlo Petter

"Three major challenges for the mining industry are the minimization of energy use, water consumption and environmental impact. Therefore, any technique that reduces milling waste, decreases water usage and shrinks impact during mine life must be considered a major innovation in mining.To these ends, one of the most impactful developments in mining within the last 10 years has been the expanded use of high technology sensors to create preconcentrations of mine ore (Jönsson, 2014). The most common sensors used are charge-coupled device (CCD) cameras, that allow through a red, green and blue (RGB) coloring system, the separation of minerals with different colors, tones and, in many cases, with differences in brightness.More recently, the development and use of dual energy X-ray transmission (DE-XRT) to enable the separation by atomic density of the constituent minerals within a given rock has become a reality. Within this work, a rapid bibliographical review of the CCD and DE-XRT methods and examples of their usage within mining and the industrial minerals sector are presented.Sensor-based sorting in miningAutomation within mining is one of the industry’s current goals. Sensors of various kinds have been used as steps toward automation in recent years, from improving the safety and productivity of haul trucks through the use of cameras and global positioning satellites (GPS), to the divination of slope failures. Just as with other mining areas, sorting has improved dramatically and made great steps toward automation in recent years (Wotruba et al., 2014).Sensor-based sorting (SBS) uses spectromatic sensors to identify intrinsic characteristics of particles and separates them by either mechanical or pneumatic means into different product streams (Wotruba et al., 2014). SBS can be used with great effectiveness to improve gravimetric beneficiation through the selective separation or preconcentration of run of mine ores (ROM)."

Jan 1, 2015

By Miguel Reyes, Bruce Whisner, Joseph Bickson, Lincan Yan, David Yantek, Justin Srednicki, Nicholas Damiano, Eric Bauer

Built-in-place (BIP) refuge alternatives (RAs) are designed to provide a secure space for miners who cannot escape during a mine emergency. Heat and humidity buildup within RAs may expose miners to physiological hazards such as heat stress. To minimize the risk of heat stress, Title 30 Code of Federal Regulations (CFR), or 30 CFR, mandates a maximum allowable apparent temperature (AT) for an occupied RA of 35 °C (95 °F) (MSHA 2008 [1]). The National Institute for Occupational Safety and Health (NIOSH) has conducted extensive research on the thermal environment of occupied RAs intended for use in underground coal mines. NIOSH research has demonstrated that a fully occupied BIP RA can exceed the AT limit by > 5.6 °C (10 °F) in mines with elevated mine strata and air temperatures (Bissert et al. 2017 [2]). In this circumstance, an RA cooling system could provide a solution. This paper provides an overview of test methodology and findings as well as guidance on improving the performance of a cryogenic air system prototype by optimizing the flow rate, increasing the tank storage capacity, and improving the efficiency of the heat exchanger of the cryogenic system. This may enable BIP RAs to meet the 35 °C (95 °F) AT limit in mines with elevated temperatures. The information in this paper is useful for RA manufacturers and mines that may choose to implement a cryogenic air system as a heat mitigation strategy

By Miguel Reyes, Bruce Whisner, Joseph Bickson, Lincan Yan, David Yantek, Justin Srednicki, Nicholas Damiano, Eric Bauer

Built-in-place (BIP) refuge alternatives (RAs) are designed to provide a secure space for miners who cannot escape during a mine emergency. Heat and humidity buildup within RAs may expose miners to physiological hazards such as heat stress. To minimize the risk of heat stress, Title 30 Code of Federal Regulations (CFR), or 30 CFR, mandates a maximum allowable apparent temperature (AT) for an occupied RA of 35 °C (95 °F) (MSHA 2008 [1]). The National Institute for Occupational Safety and Health (NIOSH) has conducted extensive research on the thermal environment of occupied RAs intended for use in underground coal mines. NIOSH research has demonstrated that a fully occupied BIP RA can exceed the AT limit by > 5.6 °C (10 °F) in mines with elevated mine strata and air temperatures (Bissert et al. 2017 [2]). In this circumstance, an RA cooling system could provide a solution. This paper provides an overview of test methodology and findings as well as guidance on improving the performance of a cryogenic air system prototype by optimizing the flow rate, increasing the tank storage capacity, and improving the efficiency of the heat exchanger of the cryogenic system. This may enable BIP RAs to meet the 35 °C (95 °F) AT limit in mines with elevated temperatures. The information in this paper is useful for RA manufacturers and mines that may choose to implement a cryogenic air system as a heat mitigation strategy

By Paul Lynch

"Since being reported to the 2012 UMI in Shanghai, the Cook Islands has been steadily developing for the commencement of it Seabed Minerals sector in its large Exclusive Economic Zone which contain a vast and unique Manganese Nodule resource, estimated at 10 billion tonnes1. At the 2013 UMI in Brazil, it was reported that the Seabed Minerals Act had commenced and all the necessary complex Technical aspects of this developmental work was being undertaken. At the 2014 UMI in Portugal, full details of the final developments leading to the opening of the Tender of Exploration Blocks in the Cook Islands EEZ will be presented in a brief but comprehensive method, using Poster displays, Powerpoint and active Website interaction. This will show the drafted Regulations, prepared on best international standards, to address both Licencing and Environmental requirements, to give clarity and security to the Resources Owner, industry and stakeholders. This work in being coordinated by the Cook Islands Seabed Minerals Authority, with the valuable collaboration of many international, regional and national stakeholders, including the Cook Islands NGOs, Marine Resources, Marine Park and National Environment Service."

Sep 1, 2014

By Brendan Demich, Joseph McGuire, Emily J. Haas

Near misses recorded and reported by workers can provide awarenessto the potential causes of injury and prompt safety management initiatives. Although most companies require near-miss reporting, it is unclear what the value of these reports are, if any, and how they influence subsequent actions or controls to reduce on-the-job risks. Researchers at the National Institute for Occupational Safety and Health (NIOSH) conducted a case study with an aggregates company in which near-miss reports were analyzed at each of their locations over an entire quarter during the summer of 2018. Within that quarter, workers recorded 249 near misses. Of those, 167 were valid near misses that occurred at work. Researchers coded the reports using a qualitative 5 × 5 risk matrix. Of the 167 near misses, 19% were deemed low risk, 25% moderate risk, 30% high risk, and 26% critical risk. Several patterns in the near-miss incidents were documented, including classification of incidents and common corrective actions referenced (i.e., elimination/substitution, engineering control or redesign, work process/procedures, and personal protective equipment). The analysis provides insight into ways that risk communication and management programs can be improved to reengage workers and their situational awareness on the job.

By L. Xinghua

Limonite is a general term for a group of amorphous iron oxide and iron hydroxide materials. It is considered as one of the very refractory iron ore types due to its wide variation in chemical composition, iron content, moisture content and easily sliming in the course of comminution. Iron grade of test sample is 25.48%, the iron minerals are mainly limonite; and the gangue minerals consist of quartz and feldspar in majority, secondarily silicate minerals. In this test work, high intensity magnetic separation (HIMS)-cationic reverse flotation and magnetic roasting-low intensity magnetic separation (LIMS) tests were conducted on limonite ore. The test results show that the concentrate with iron grade of 50.97% and recovery of 68.50% can be obtained by HIMS-cationic reverse flotation technique; while using magnetic roasting-LIMS technique, the better concentrate indexes of iron grade of 60.36% and recovery of 89.71% are achieved, and the iron grade of tailing is only 4.42%. Therefore, the magnetic roasting-LIMS technique is a better suitable method for beneficiation of low-grade limonite ore. Keywords: Low-grade limonite; Mineralogy; HIMS; Cationic reverse flotation; Magnetic roasting; LIMS

Feb 27, 2013

By Donald A. Bruce

Pregrouting is an extremely important part of many rock tunneling projects. However, poor and unsatisfactory performances have been frequently recorded often with very severe consequences, technically and financially. This paper, based on personal knowledge of several relevant case histories, provides recommendations with respect to specification drafting, drilling, water pressure testing, and grouting methodologies, and cementitious grout mix design principles. Even given that the logistical challenges facing tunnel pregrouting from underground will prevent all the sophistication and innovations of contemporary dam foundation grouting being practically implemented, there is still opportunity and need to change “traditional” approaches.

Jan 1, 2005

By SME SME

NORTH AMERICAN TUNNELING 2024 PROCEEDINGS

Jun 23, 2024

By L. O’Connor, E. Tarshizi

The objective of this work is to provide a detailed review and a list of references in chronological order, comprising 80 recent technical papers, on the use of discrete-event simulation (DES) modeling in mining engineering. In this article, the review papers of published mine simulation projects through 2007 are summarized, and then a comprehensive review of individual articles published from 2008 to 2015 is presented. This survey work also includes analyses of the simulation tools used in the published projects, mining types and applications in order to assess these key features and evaluate the recent state of research in mine DES simulation. In addition, an interactive map visualization for the locations of the simulated projects is made available on a website to benefit current and prospective scholars in the field. The results of this investigation revealed that the most common application of DES in mining had been mining equipment selection and analysis, while ore processing and risk management projects were less frequently reported. The results also showed that modeling surface mines were in the majority, but the trend of publications for underground mine simulations had also increased. According to the results, ARENA was the most popular simulation software package, but several simulation tools that were only used once or twice in the mining projects are also included in this review.

Jan 1, 2018

By L. O’Connor, E. Tarshizi

The objective of this work is to provide a detailed review and a list of references in chronological order, comprising 80 recent technical papers, on the use of discrete-event simulation (DES) modeling in mining engineering. In this article, the review papers of published mine simulation projects through 2007 are summarized, and then a comprehensive review of individual articles published from 2008 to 2015 is presented. This survey work also includes analyses of the simulation tools used in the published projects, mining types and applications in order to assess these key features and evaluate the recent state of research in mine DES simulation. In addition, an interactive map visualization for the locations of the simulated projects is made available on a website to benefit current and prospective scholars in the field. The results of this investigation revealed that the most common application of DES in mining had been mining equipment selection and analysis, while ore processing and risk management projects were less frequently reported. The results also showed that modeling surface mines were in the majority, but the trend of publications for underground mine simulations had also increased. According to the results, ARENA was the most popular simulation software package, but several simulation tools that were only used once or twice in the mining projects are also included in this review.

Jan 1, 2017

By P. D?Elia

Following a study by NIOSH on the availability of teams in the U.S. as well as existing training sites and their capabilities, the Penn State University, leaders of the Pittsburgh Section of SME, providers of mine rescue equipment, and industry sponsors united to establish and make fully functional a student mine rescue team at Penn State University. With the growth of MERD and mine rescue competitive events at Missouri S&T, the Mine Training and Technology Center in PA, and at Colorado School of Mines Edgar Mine, a critical mass of effective training venues were made available to help student teams progress and develop mine rescue skills. The challenges to be met in creating and developing a student mine rescue team will be discussed. The rewards from this type of effort will be the quick capability of graduates from mining engineering programs to be involved in not only mining operations, but industry mine rescue teams and other leadership roles as well.

Jan 1, 2012

By R. L. Virta

Four companies mined ball call in four states in 2009, H.C. Spinks Clay Co. Inc. (owned by Lhoist Group), Kentucky-Tennessee Clay Co. (owned by Imerys Group), Old Hickory Clay Co. and Unimin Corp. Production, on the basis of preliminary data, was 820 kt (904,000 st) with an estimated value of $39.4 million. That was a 15-percent decrease in tonnage from 967 Mt (1.1 mil-lion st) with a value of $44.3 million that was produced in 2008. Tennessee was the top producing state with 59 percent of domestic production, followed by Texas, Mississippi and Kentucky. About 71 percent of production was airfloat, 18 perc

Jun 1, 2010

By A. G. Yapo, T. W. Camm

"All-in sustaining cost is a metric used by mining companies to reflect the cost of gold mining in a consistent format useful to both investors and mining professionals. Cost reporting focused on the direct cost of mining and processing ore was summarized in the non-GAAP cash cost developed by the Gold Institute in 1996. In 2013, a group of mining companies, working with the World Gold Council, developed a more inclusive approach to reporting costs designed to solve the dilemma of showing a more comprehensive reflection of recurring costs involved in producing gold, without discouraging investors. INTRODUCTION Mining today plays a key role in the development of our civilization as a source of essential raw material and provider of essential fuels, producer of jobs, and a factor in support of the international balance of monetary payment (Camm, 2014). Professionals in mining locate, develop, design and manage ore deposits in an environmentally safe and profitable manner. As mineral deposits become increasingly scarce, new challenges face the industry. A current trend is to an increased emphasis on underground mining techniques for deeper deposits. Operations are safer today than before as companies understand better their work environment and the importance of mining responsibly. A continual challenge for the industry is accurately reflecting the costs and selling price of ore. An enduring characteristic of mining is the situation where the market typically determines the price of a commodity; the main control a company has on the bottom line is to control the cost of production. An attempt to bring light and clarity on the cost of their business will give a better idea to investors on the true profitability of the mining business. Gold producers face this struggle to accurately reflect the cost of production while also seeking to attract the interest of the investment community (Hill, 2013). In order to have a consistent format to report on their production costs, leading gold producers through their alliance inside the World Gold Council (WGC), worked on the adoption of a new cost framework: the All-in Sustaining Cost (AISC) and All-in Cost (AIC). Since 1996, the traditional cash cost reporting has focused only on the mining and processing costs incurred in mining an ounce of gold, which included the costs of goods sold (labor, energy, and consumables costs) and royalties (Table 1). But cash cost reporting ignores many important aspects, like sustaining capital, general and administrative expenses, and site rehabilitation at the end of the mine life (Whelan, 2013). The cash cost was used to attract many investors into the business. In fact the high gross margin (sales minus cash costs) has been promoted the past decades by the industry instead of the net or operating margin. As a result, even when the gold price was high, nearly $1900 per ounce in August 2011, gold producers were not reporting excessive profits in their cash flow / income statements, to the disappointment and incomprehension of investors (Milstead, 2014). The truth was simply that the other costs omitted in the traditional cash cost were reducing the apparent profits."

Jan 1, 2017