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By Peter A. Hacquebard

"The early history of the Geological Survey of Canada is closely connected with coal geology investigations in the Atlantic Provinces. In 1843, Sir William Logan, the first director of the Geological Survey, measured the 4441m thick shore section at Joggins in Nova Scotia. Detailed mapping of the coalfields were subsequently carried out by H. Fletcher during the latter part of the nineteenth and first part of the present century. During the 1920-1940 period, the stratigraphy of the carboniferous WIZS' established by WA. Bell, who later also became a diretor of the Survey. Bell's work WIZS' followed by coal geology investigations of A.A. Hayes, W.S. Dyer, EA. Goranson, G. W.H. Norman, J.E. Muller, T.B. Haites and P.A. Hacquebord.The activities and accomplishments of the Survey geologists during the past 150 years are presented in this paper.General Outline of Survey Activities in Coal Geology During the Past 150 YearsIn 1842, when the Geological Survey of Canada (GSC) was established, the industrialization of the major countries of Western Europe and North America was actively persued. The energy required for this industrialization was obtained from the only fossil fuel then available, namely coal. The measure of a country's major mineral wealth at that time was the availability of mineable resources of coal. Eastern Canada, where mining had been carried out since 1720, was known to be well endowed with valuable coal deposits. In the major fields of Nova Scotia (Fig. I) several large-scale operations had been started during the middle and latter part of the nineteenth century.The significance of coal, therefore, was well understood, and exploration surveys specifically oriented toward coal were carried out by the Geological Survey from its earliest beginning. The first report of a detailed geological description of the coal measures of eastern Canada was prepared in 1843 by Sir William Logan (1845), the founder and first director of the Geological Survey of Canada. This early work was continued and complemented in 1896 by H. fletcher (1906), who during the latter part of the nineteenth century and first part of the present century systematically mapped the coal-bearing regions of Nova Scotia, which he considered all to be of approximately the same age."

Jan 1, 1992

By Nosa O. Egiebor, Kafui Nyavor

"The effectiveness of sulphuric acid, nitric acid, and hydrogen peroxide pressure oxidation on the cyanide extractability of gold from a double-refractory concentrate is presented. Whileover90% of the sulphide content could be oxidized by either of the two acid pretreatments, only 65% was achieved by the peroxide oxidation. Carbon oxidation by both acid and peroxide pressure oxidation were less than 15%. Although the peroxide pressure oxidation pretreatment resulted in much lower sulphur and carbon oxidation, it gave pretreated residues with decreased levels of preg-robbing activities and higher gold recoveries during subsequent cyanidation, thus indicating some deactivation ofthe preg-robbing carbon during pretreatment with hydrogen peroxide. The refractoriness due to carbon preg-robbing activity was found to contribute more to the refractory behaviour of the concentrate than the occlusion of gold particles by the sulphide mineralization.IntroductionGold ores and concentrates are classified as refractory when a significant portion of the gold content cannot be extracted efficiently by conventional cyanidation, even after fme grinding (Weir and Berezowsky, 1984); (Demopoulos and Papangelakis, 1987). The refractory behaviour of precious metal ores and concentrates is generally attributed to two main factors: The presence of carbonaceous materials which could cause preg-robbing activity during cyanidation (Zaitseva et al., 1973); (Nice, 1971); Scheiner et al., 1971); (Eisele et al., 1983), or occlude gold-bearing minerals (Wells and Mullens, 1973); (Gasparrini, 1983); (Chen and Reddby, 1990), and the occurrence of sulphide minerals which can occlude gold, thus reducing the access of lixiviants (Schwartz, 1944); (Weir et al., 1986); (papangelakis and Demopoulos, 1990); (Michaelis, 1989); (Schweigart, 1965). When the refractoriness is due to a combination of these two factors, the ore or concentrate can be referred to as being ""double-refractory"". Because of the rarity of gold ores exhibiting this double-refractory phenomenon, only a few studies have been carried out on their suitability for pretreatment by existing techniques."

Jan 1, 1992

By P. R. Goad

"Kidd Creek is a large volcanogenic base metal sulphide deposit, located near the west end of the Abitibi greenstone belt, 27 km north of Timmins, Ontario. The rhyolite geology is characterized by a NNE-striking and steeply east-dipping package of rhyolite volcaniclastics upon which has been imposed a strong ESE-striking and north-dipping structural fabric . Massive rhyolite units with grey-black. chloritic cores and yellow, sericitic margins intrude as dykes into the stratigraphic footwall and as sills higher in the stratigraphy. Massive rhyolite units positioned near the top of the felsic pile exhibit an extensive marginal development of hydraulic fracturing and are termed crackle-brecciated rhyolite.The stringer sulphide zone is positioned in a lobate blanket of crackle-brecciated rhyolite at the top of the felsic pile. The stringer sulphide zone is characterized by a mature chemical alteration, being specifically depleted in alkalis and enriched in iron-rich chlorite. with accompanying silica, sericite and carbonate alteration. A suite of trace elements characterizes this mature alteration. The massive rhyolite units, which intrude lower in the rhyolite volcaniclastics, exhibit a core of weak chlorite alteration and strong marginal sericite alteration. Tight or unfractured massive rhyolite units are essentially devoid of sulphide mineralization and exhibit a suite of trace elements characteristic of this immature alteration. It is interpreted that the massive rhyolite units intruded into an already evolving system and ""choked-off"" active conduits carrying hydrothermal fluids and subsequently acquired an immature alteration signature. Rhyolite units positioned higher in the pile developed intense hydraulic fracturing and a mature alteration coincident with the formation of the stringer sulphide zone. In summary, a model, based strictly upon the rhyolite geology, is reviewed to assist in the exploration for volcanogenic base metal sulphide deposits."

Jan 1, 1985

By R. C. Carne, R. J. Cathro

"Most of the recent large discoveries of zinc, lead and silver in Western Canada are Paleozoic-aged stratiform deposits that occur within the limits of the tectonic sub-province of the Canadian Cordillera known as Selwyn Basin. Bounded on either side by coeval carbonate platforms. Selwyn Basin trends northwest for 1300 km from northeast British Columbia to Alaska. Paleozoic rocks of Selwyn Basin consist primarily of chert, shale and coarser-grained clastic sedimentary rocks with minor volcanic rocks.The Selwyn Basin deposits have few counterparts elsewhere in Canada, but have a close similarity in geological setting, mineralogy and morphology to well-known deposits such as McArthur (HYC) in Australia, Meggen and Rammelsberg in West Germany, and Sullivan in British Columbia. Recent studies of these deposits have led to an emerging, but now generally accepted, model of ore deposition in which stratabound zinc-lead-silver shale-hosted or ""sedimentary-exhalative"" (sedex) deposits are precipitated in active tectonic environments from metalliferous geothermal brines that rise to the sea floor along deep-seated fault zones. Although their mineralogy and ore metal zoning can be similar to that of volcanogenic massive sulphide deposits, most sedex deposits have only a weak genetic link with volcanism.Sedex mineralization in Selwyn Basin has been identified within three separate ages of shale or its metamorphosed equivalent. The lower Cambrian-age Anvil Camp in central Yukon Territory contains the only producing mine (Faro). Important lower Silurian-age zinc-lead mineralization is at Howards Pass along the Yukon - Northwest Territories border. Barite and zinc-lead-barite mineralization of upper Devonian age occurs across Selwyn Basin. Potentially economic deposits have been found at Macmillan Pass, along the Yukon - Northwest Territories border and in the Gataga District of northeastern British Columbia."

Jan 1, 1982

By M. P. Brameld, R. H. McCorkell

"Overburden covering bedrock uranium deposits was sampled to depths of 29 m and Rn concentrations measured at the same depths. Total-alpha activities, V concentrations and Rn emanation (J) of the samples were measured. The U-flux into the overburden was greater in the past: oxidation and dissolution has since removed most U, leaving decay products which indicate the presence of U deposits when U itself does not. Distributions of U and decay products and their ratios to each other reflect U-migration and degrees of U-removal. Rn distribution in overburden is related to the J of overburden samples and the presence and movement of groundwater. Simple, rapid methods of total-alpha and J measurement are described.IntroductionThe overburden drilling apparatus developed by Bondar-Clegg and Company makes possible sampling and radon measurement in overburden from the surface down to about 50 metres. This apparatus was used here to study the diffusion of uranium and its decay products from ore deposits into over lying overburden at the N deposit of the Amok Ltd. property (Cluff Lake, Saskatchewan) and on the Imperial Minerals Ltd. property at Gooderham, Ontario. These ores are enclosed in bedrock; the overburdens were deposited by glaciers or streams. The migration of uranium and its decay products in such situations and the factors which affect it have been little studied in the past, as readily usable techniques for mapping it in three dimensions have not been available. The results reported here are somewhat sketchy and preliminary, but they indicate the value of the methods used and some of the patterns to be expected. Surface and subsurface sampling and measurements were carried out on 3-line grids crossing known zones of mineralization. The lines were 60 metres apart at Gooderham and 40 metres apart at Cluff Lake."

Jan 1, 1982

By E. G. Parker

"Sherritt's zinc pressure leaching process converts zinc sulphide concentrates directly to zinc sulphate solutions and elemental sulphur. Thus, one pressure process step replaces both the roasting and leaching operations of the conventional roast-leach route. In addition, high single-pass extractions eliminate the need for residue treatments to recover unleached zinc. Because pressure leaching produces elemental sulphur, rather than sulphur dioxide, acid plants and smoke stacks are not required, and air pollution control and work-place hygiene are greatly improved. .In 1977, Cominco Ltd. and Sherritt Gordon Mines Limited jointly operated a three-tonne-per-day pilot plant to demonstrate pressure oxidative leaching of Sullivan zinc concentrate and the subsequent separation of elemental sulphur. The process consisted of regrinding the concentrate, continuous leaching at 150°C at elevated oxygen pressures in a four compartment autoclave and the subsequent recovery of elemental sulphur, either in the molten liquid form from a decantation autoclave or as a flotation concentrate. Of the zinc contained in the concentrate, 97% was extracted in 90 minutes, and 96% of the sulphur was converted to the elemental form.Following the successful pilot campaign, Cominco began building the world's first commercial zinc pressure leaching plant. This plant, which was in operation by late 1980, will eventually treat about 25% of Cominco's planned zinc capacity of270,000 tonnes per year.This paper describes the general process principles, the results obtained from the pilot plant and the integration of the process into Cominco's operations at Trail. The application of pressure leaching to a ""grass-roots"" plant is also discussed, and compared with conventional roast-leaching."

Jan 1, 1981

By Michel David

"The usual complaint of mines is that grade does not match exploration expectations. Quite often, more tons are mined than expected but at a lower grade. This can be seen as dilution. Geostatistics can help predict which dilution can be expected both in terms of grade and tonnage for different mining methods.The usual vocabulary of geostatistics speaks of block distribution; block variance, size effect, information effect, all terms which say very little to the practitioner. In f act, all this can be rephrased in terms of dilution .In this paper, the following is presented - an example which shows how reserves change with the size of selection units and number of samples taken, and tables which show the dilution that are bound to happen when dealing with the commonly encountered log-normal distribution. Finally, the paper shows how grade tonnage computations should be made in the case of an arbitrary distribution. IntroductionGeostatistics progresses more and more rapidly if one judge s by the number and quality of papers published in Mathematical Geology or at APCOM meetings. More and more case studies describing successful applications are published (David et al., 1986)(Kwa and Mousset-Jones, 1987). It is estimated that more than 270/0 of the gold mines around the world use geostatistics. There is still, however, a lot of resistance from the remaining 73%. Geostatistics has more formulae and equations than it needs to reach year 2000. We will be well into the third millenium before all the models available now are actually used. The progress may come in the form of finding better ways to present known statistical results and getting away from the jargon of geostatisticians. One example may be in trying to explain how we can answer the most common plea of the mining industry: production grade is not what was expected in the feasibility study."

Jan 1, 1988

By Louis R. Bernier

Most systematic studies carried out on passive treatment systems incorporating the use of limestone drains, under aerobic or anaerobic conditions, essentially deal with the treatment of effluents from mines in the USA. A limestone drain typically comprises a trench filled with crushed limestone rocks surrounded by impervious materials. In the case of anoxic drains, the trench is generally isolated under a geomembrane liner covered with soil. Contaminated mine effluents flow by gravity towards these limestone drains where the passive treatment consists in bringing the carbonates into solution, thus increasing the pH and alkalinity. Factors to be considered in the design are: chemistry of the contaminated mining effluent ([metals, [Al], [sulfates], dissolved oxygen, acidity, pH), desired residence time, nature of the rock, grain size, density, void ratio and mass of the limestone rock used, alkalinity, life span and hydraulic behaviour of the drain. Certain secondary effects (saturation by sulfates, co-precipitation, adsorption) may either be beneficial (lowering the sulphate and metal load) or harmful (armoring the limestone rock and clogging of the drain). This paper gives a brief status report on the available knowledge on the use of limestone drains for passive treatment of mining effluents heavily loaded with metals. Examples given include the old Lorraine mine (Ni-Cu), Témiscamingue, where limestone and dolomite rock drains were installed in 1998 when a cover with capillary barrier effects was placed over the tailings site.

Nov 1, 2002

By Jean-Luc Collins

"The paper deals with the impact of fleet imbalance on a deterministic evaluation of shovel fleet productive capacity. It shows that if the fleet imbalance is overlooked, then estimated fleet productive capacity will be overrated.The paper shows that fleet imbalance inflates utilization, and care must be taken when using such statistics which are derived from reported field-equipment-hours. It shows that the utilization must be deflated by a factor called 'balancing efficiency"" in order to estimate shovel productive capacity correctly. The paper also shows how fleet imbalance can be controlled by managing idle time or downtime in an actual operation.The technique used for measuring the balancing efficiency factor is based on statistical analysis of equipment utilization."

Jan 1, 1980

By L. J. Visentin, J. G. Rickaby

"Audiometric testing is a key element in hearing conservation in the mining environment. This paper gives the history of the audiometric testing program carried out by Inco Metals Company, including the program objectives the personnel and equipment involved, calibration and testing, the test procedure, and the classification and evaluation of the test results.IntroductionThe operations of the Ontario Division of Inco Metals Company are located primarily in the Sudbury District. They also include a refine ry at Port Colborne and a mine and concentrator at Shebandowan near Thunder Bay.The company operates nine underground mines, and one open pit, while maintaining six underground mines on a standby basis. Ore from these operations is processed in four concentrators. The metallurgical facilities include a smelter, a matte processing plant, a copper refinery, a nickel refinery and an iron ore recovery plant at Sudbury, and a nickel refinery at Port Colborne. Inco Metals currently mines roughly 9,000,000 tons annually and produces IS elements.Excessive noise in the work place has been a serious problem in the mining industry since the introduction of compressed-air-powered machinery in the last century. At the same time, growing levels of noise inherent in our social environment can threaten the hearing of employees and their families.Only in the last 20 years, however, has the extent of this problem and its implications for people working in the industry and their families been recognized. Since the industry has become aware of the situation it has taken steps to implement comprehensive noise reduction and hearing conservation programs."

Jan 1, 1982

By Yves C. Lizotte, Malcolm J. Scobie

Blast fragmentation is affected by the physical and mechanical characteristics of the rockmass as determined by geology as well as the explosive energy, the partition of this energy, the actual amount of energy transmitted to the rockmass, the blast geometry and the detonation sequence. This paper reviews studies of the influence of geology on blast fragmentation, particularly structure, i.e. the in situ or inherent fragmentation arising from rock discontinuities. Prior structural studies have mainly been limited to comparing equivalent diameters of the in situ blocks with the size distributions of the blasted material. No criteria exist to integrate structure into blast design. This paper reviews on-going studies of the blasted fragment shape and size observed in different rockmasses aimed at analyzing geological control over blasting. Digital photoanalysis was applied {o measure size and shape distributions, to correlate results with block size distributions and shape parameters of the inherent fragmentation. An integrated and comprehensive fragmentation assessment procedure which accounts for geological control is proposed. The potential of this research is to provide a greater understanding of the true contribution of explosives to fragmentation, the effects of fragment shape on system productivity and the reduction of blast-induced damage.

Jan 1, 1994

By Arthur Lieu

Outline Removal mechanisms of Se and Mo in the Key Lake Bulk Neutralization circuit Bulk circuit Detail process modification in the Key Lake BN circuit Process performance after commissioning Objective Legacy effects of Se and Mo from the historical operation of Key Lake mill were shown to have an negative effect on the regional biota in the downstream environment. The water treatment circuit was not designed to remove Se and Mo from the effluent. Reduce Se and Mo concentrations in final effluent under0.028 0.028 ppm ppm and 0.3 and ppm ppm(CNSC regulatory limits).(limits).??????

Nov 1, 2011

By Nigel J. Cook

"Detailed mineralogical examination of gold-bearing rocks, ores, concentrates and other samples should be considered an integral part of any study of a deposit for which exploitation is being planned. Adequate mineralogical study, although time consuming and often costly, can significantly improve understanding of the mineralization, can help to optimize the results of any metallurgical testing and can be of great value in case of potential trouble-shooting. The advantages and disadvantages of various examination techniques are discussed with reference to a number oj mineralogical studies oj Canadian gold-bearing samples.IntroductionVarious authors, notably Gasparrini (1983), Harris (1989) and Henley (1990), have stressed that mineralogical study of gold ores is critical to successful and efficient beneficiation. Only in cases where diagnostic cyanide leach testing is successful can detailed mineralogical examination be disregarded. Such examination of gold-bearing rocks and metallurgical products is all too often neglected because the methods involved are believed to be time-consuming, costly, and may carry a considerable degree of inaccuracy. Commonly, bulk metallurgical testing is, carried out without prior or concurrent mineralogical examination, causing the results of the testwork to be difficult to interpret, or in some cases, misleading. This, in turn, may lead to> significant delays to the project at the feasibility stage or mean that understanding of the sample is limited, preventing the introduction of prudent modifications at a later stage if problems arise. Mineralogical studies may guide the successful implementation of a metallurgical test program."

Jan 1, 1990

By Kosei Ishida

To achieve renovation work without noise, the authors developed techniques of manufacturing pre-cut interior finishing components for renovation work. In this paper, to achieve the system of pre-cut interior finishing components, the authors describe a measuring method of reinforced-concrete structure by 3D laser scanner and then describe a method of making a design of pre-cut interior finishing components with the polygon model. Using these two methods, the steps of manufacturing pre-cut interior finishing components consist of the following four steps: First, measure the building shape using a 3D laser scanner. Secondly, integrate a point cloud data and retrieve the markings on the floor. Then, create a polygon model of the building based on the point cloud data. Lastly, make a drywall design using a polygon model. To evaluate the technique feasibility of manufacturing pre-cut interior finishing components, the authors have conducted an experiment of the finishing interior work of the drywall. Using pre-cut interior finishing components, the authors have been able to achieve interior finishing work without noise.

Aug 1, 2013

By T. H. North, A. G. Glover, R. J. Pick

"Girth welding operations represent the rate-limiting step in pipeline construction. A joint industry-university program was set up to establish the field welding characteristics of large-diameter, high-strength line pipe.Theoretical work carried out at the University of Waterloo showed that pipe wall thickness and joint misalignment prior to welding has a marked influence on the lifting stresses acting on the root pass of girth welds. Pipe diameter and pipe ovality had negligible effects. Super-position of lifting and residual stress (caused by the fusion welding operation) highlighted regions of the weld bead most susceptible to hydrogen-induced cracking.The field welding characteristics of 1219-mm-diameter, 13.72-mm-wt Grade 483 line pipe were evaluated using a specially designed test rig. The principal test variables were lift height, delay time after root pass deposition, preheat temperature, pipe composition and joint misalignment prior to welding. For any given life, preheat and joint misalignment prior to welding had the most significant effect on cracking tendency.The output of this program has industrial significance and illustrates the beneficial features of university-industry collaboration.IntroductionField welding operations comprise the rate-limiting step during pipeline construction. Crack-free girth welds must be made in a wide range of weather conditions and consequently the field weldability of line pipe compositions directly affects pipeline integrity and construction economics.Pipe-laying practice comprises root bead deposition followed by a skidding operation involving lifting (or lowering) the pipe length onto skid s so that the next pipe length can be aligned prior to welding. Consider pipeline construction using 24.4-m lengths of 1219-mm-diameter , 13.72-mm-wt Grade 483 pipe weighing approximately 10,000 kg. Skidding involves loading a 3-mm-thick root bead by moving the free end of the pipe through vertical distances of up to 700 mm . The likelihood of cracking in these circumstances depends on the inherent crack susceptibility of the pipe composition employed, on the hydrogen content of the deposited weld metal and on how well the joint handles the external stressing caused byskidding."

Jan 1, 1981

By S. Perkins, E. Young, L. Dufour, K. McVey, L. Rolandi

This paper presents a review of plant layout considerations incorporated into recent designs of SAG/Ball mill circuits for two medium sized concentrators. The plant layouts presented and the design concepts discussed, relate to smaller SAG circuits, but can equally apply to larger milling circuits. Included are design concepts and ideas introduced by the various project teams, and the focus is on the primary factors of any layout design which are safety, constructability, operability, and capital cost.

Jan 1, 2012

By Kosta Fytas, Nour-Eddine Chaouai

"Selection of the appropriate kriging plan during indicator kriging estimations is of a paramount importance to the precision of ore reserve estimation. However, very little is known on the sensitivy of indicator kriging results when changing the kriging plan parameters (mainly search distance and number of samples). This paper evaluates the effect of the search distance and number of samples on indicator kriging results using a gold deposit as a case study.IntroductionBlock estimation using kriging is based on the autocorrelation function (variogram) on one hand and on the kriging plan on the other. As far as the variogram is concerned it is more or less subjectively adjusted and this is reflected on its parameters (range, sill, nugget effect and anisotropy). The effect of a poor estimation of these parameters on the kriging variance of ordinary kriging has been proven very important (Brooker, 1986). Choosing a kriging plan is generally a difficult matter depending on the estimation type (global or local). Generally there is not a unique kriging plan be cause there is not a unique structural analysis (variogram). There are no rules or dogmas in choosing a kriging plan but it is rather a function of the sampling pattern (David, 1982).Structural analysis requires the hypothesis of quasistationarity but very often either the data available within the zone of quasi-stationarity are too many so that the search distance is reduced during kriging or the data are too few to satisfy a stationary kriging system (Journel and Huijbregts 1978). As a rule, the larger the neighbourhood, the more precise the estimates should be , but for large neighbourhoods the hypothesis of stationarity does not always hold (Rivoirard 1987; Armstrong and Champigny 1989)."

Jan 1, 1991

By Sarah Bélair, Denis Beltrami, Deka Moussa Ragueh, Valérie Weigel

"Scandium is a highly valuable element belonging to the rare earth elements (REE) but it has different chemical and physical properties from those of lanthanides. This metal is generally used in aluminum-scandium alloys and in fuel cells but the development of its market is slowed down by its high price (more than 1000 US$/kg for a 99.0% grade product). Indeed, the low scandium content in the continental crust (an average of 22 ppm) and the difficulties to extract it selectively from solutions containing high impurity concentrations increase the cost of the recovery processes. Nowadays, scandium is primarily recovered as a byproduct.ERAMET is developing a hydrometallurgical process in Gabon (Mabounié) in which the scandium content in the deposit reaches 10 to 100 ppm. The Maboumine project consists in the extraction and purification of uranium, niobium, tantalum and REE from Mabounié ore. In the frame of this hydrometallurgical project, ERAMET had also studied the feasibility to recover scandium as a byproduct. During the ore leaching, uranium and rare earth elements including scandium are solubilized into the pregnant leach solution (PLS). Among the various methods investigated to recover scandium from the PLS, liquid-liquid extraction using Primene JM-T as extractant was chosen and tested first at laboratory scale and then at pilot scale. Selective stripping of the loaded organic was carried out by using phosphoric acid solution, allowing the selective recovery of scandium from thorium and zirconium partially extracted from the PLS by Primene JM-T under the process conditions."

Jan 1, 2016

By Robert B. Parsons

"The February 18, 1987, Federal Budget contains a proposed amendment which would simplify somewhat the ""successor corporation"" rules in the Income Tax Act. Despite this amendment, though, the important successor rules will continue to be relatively complex.IntroductionThe February 18, 1987, Federal Budget papers propose an income tax amendment whereby the so-called ""successor corporation"" rules would be revised by removing the present provision which limits the application of these rules to a maximum of two ""successions"". The successor corporation rules represent one of the most complicated sets of rules in the Income Tax Act. This month, Tax Notes seeks to explain these rules and the proposed amendment in simplified terms.Basically, the successor rules provide a mechanism for transferring unused exploration and development expenses from one taxpayer to another , in specified circumstances. The aforementioned limitation of two successions refers to the rule which allows a maximum of two such transfers with respect to any particular pool of deductions."

Jan 1, 1987

By Brian Hall

For some years, the mining industry has been consistently delivering returns below the market average. One of the causes is a disconnect between what is perceived to drive value creation by many industry analysts and senior corporate executives, and what actually drives the intrinsic value of mining operations. The perverse effect is that strategies that should increase value are perceived to have the potential to drive share prices down, and vice versa. This paper challenges common perceptions of what drives a mining company?s value. Anecdotal evidence suggests that the key drivers of value in the market, and hence in many boardrooms, are such things as increasing the reserves and production rate, and reducing unit operating cost. However, while the quoted reserves may satisfy ore reserves reporting code requirements to be economic, this does not imply that they are optimal. Often, a proportion of the quoted reserve reduces the potential value of the operation. Metal price increases, increased production rates, and operating cost reductions are all seen as conditions or actions that can improve value, and lead to cutoff grade reductions, thereby increasing ore reserves. However, modern cutoff theory and studies conducted by the author and his colleagues show clearly that, while breakeven cutoff grades will fall in these circumstances, optimum cutoffs may be much less volatile, and may even increase. Results from case studies indicate that value is maximised by right-sizing, not maximising, the production capacities, and by optimising the cutoff strategy. Values of many existing underground mining operations can be increased significantly by a substantial cutoff grade increase. Also, an increase in downside risk, and hence reduced returns, can occur using typical life-of-mine planning strategies if prices received are lower than predicted. Since this is often the case, low industry returns may be a direct result of typical strategic mine planning processes. Relatively simple cost-effective techniques are available to provide senior decision makers with information needed to assess the tradeoffs between their many conflicting corporate goals, and the balance between risk and reward. Often this information is not being generated at all. If it is, decisions affecting the value of the company are occurring by default at relatively low levels within the hierarchy, with senior executives apparently unaware of them or their potential impact. The paper concludes that without a re-evaluation of the way mining projects are valued, to demand proven value optimisation from mining plans by boards and mining analysts, the industry will continue to deliver below average returns.

May 1, 2003