Course details

  • Duration: 1 day, 2 days, 3 days or 5 days
  • Fees:
    1 day - £750
    2 days - £1500
    3 days - £2025
    5 days - £3375
  • Contact us
Register or login

22 - 24 November 2017

There are some notable similarities between mineral and petroleum projects. Both are based on depleting resources and therefore companies are under constant pressure to replace reserves.

The products are commoditised and globally traded on both spot and futures markets as well as being based on long-term contracts (iron ore, coal and gas supplies). These are products that have low demand elasticity, are capital intensive, require long development lead times and are associated with high technical and commercial risk. There are also environmental compliance and regulatory burdens associated with the development of all natural resource projects.

More information

Background

Mineral Project Appraisal and Finance -  3 Days

The stages in the development of a mineral project are outlined in in these sessions against the corresponding supporting documentation that is needed. For exploration companies the best approach is to undertake the programme of work with funds being raised through a private placement. This is not uncommon for early stage exploration and, of course, there would be no liquidity as changes in shareholding would be directly between two parties rather than exchange-based trading. As the exploration success allows the project to evolve, the original investors will want to take the company public. This process of bringing a project into production is inherently complex and promoters and investors get hopelessly confused about the interrelationships between the funding options and the stages in the technical evolution of their projects. Advisors add a veneer of mystique over the process to justify large fees. These sessions chapter aims to provide a clear road map for the development of a mineral project.

Schedule - day 1


Management and Business

Time
Session
Contributors
08.40-09.00

Registration

 
09:00-11:00
 
 
 
 

Strategic Management
Exploration Stage. Drivers. Resource Base and Asset Life. Funding Options. Synergies and Portfolio Optimisation.

D Buchanan
 
 
 
11:00-11:30 Break  
11:30-13:00
 
 
 

Strategic Management
Value Creation in Mineral Projects. Funding Options for Mineral Projects.

Strategic Management  Share structure. Workshop session

D Buchanan
13:00-14:00
Lunch
 
14:00-15.30

Management of Projects, Markets and Supplies
Constraints on Mineral Resource Development. Cost of Environmental Compliance and Closure Provision. Site Visits and Due Diligence.

D Buchanan
 
15.30-15.45
Break  
15.45-17.15

Resource Evaluation.
Sampling. Process Mineralogy.  Concepts around Geological Continuity. Polygons of Influence and Inverse Distance. Inverse Distance. 

 
D Buchanan

Schedule - day 2

 

Project Evaluation 

Time
Session
Contributors
09:00-11:00
 
 
 

Resource Evaluation
Geostatistical Methods. Reserve and Resource Definitions. Evaluation versus Production.

D Buchanan
11:00-11:30 Break  
11:30-13:00
 
 
 

Metals and Energy Project Appraisal and Finance
Role of Stock Exchanges. Preliminary Feasibility Study. Joint Venture. Feasibility Studies. 

D Buchanan
13:00-14:00
Lunch
 
14:00-15:30
 
 
 
 
 
 
 
 
 
 
 
 

Metals and Energy Project Appraisal and Finance 

Project Finance Parameters.IC-MinEval generated base metal case history for an open pit nickel mine. Cover ratios. Optimisation of gearing. Reserve tail. Conventional and financial engineering.

Net Smelter Returns

Off-take Agreements. Case history of a zinc, lead, silver NSR.

D Buchanan
 
 
15:30-15:45
Break
 
15:45-17:00
 
 
 
 
 
 
 
 
 
 
 

Minerals Engineering - Introduction to Mining

Metal Reconciliation.  Mineral Resource Management. Grade control.  Dilution. Mass balance

Minerals Engineering - Mining Methods

Safety - open pit versus underground. Transition from open pit to underground.  Operating costs estimation. Economies of scale. Trial mining.


D Buchanan

Schedule - day 3


Project Evaluation and Quantitative Finance

Time
Session
Contributors
09:00-11:00
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Minerals Engineering - Surface Mining Methods
Slope stability. Pit optimisation. Stripping ratio. Breaking ground – drilling and blasting. Loading. Transport

Minerals Engineering - Underground Mining   Tunnelling - drilling, blasting, loading and transport. Traditional longwall. Room and pillar. Mechanisation.  Longhole stoping.  Block and panel caving.  Shaft sinking.

Minerals Engineering - Transitioning from Open Pit to Underground Shaft sinking, Raise boring. Planning and timing

Minerals Engineering - Coal Mining   Strip mining. Longwall mining

D Buchanan

11:00-11:30 Break  
11:30-13:00

Minerals Engineering
Extractive Metallurgy. The central role of mineralogy in effective mineral processing. Commination. Liberation. Physical and chemical separation processes. Solid-liquid separation. Waste disposal.

Illustration of extractive metallurgy through the hydrometallurgy and pyrometallurgy of copper ores. Oxide versus sulphide ores. Flash smelting, converting and electro-refining. Heap, tank and in-situ leaching. Solvent extraction and electro-winning.

S Neethling
13:00-14:00
Lunch
 
14:00-15:30

Quantitative Finance and Financial Engineering
Decision Tree.  - Determining the Cost of Equity. WACC Computations and Optimal Funding. Inputs for the Monte Carlo Simulations. Real Option Valuation. Theory and Application to Mining Projects. Black-Scholes-Merton Formula – Inputs and case history.  

Chris Worcester
15:30-15:45
Break
 
15:45-17:00
 
 
 

Quantitative Finance and Financial Engineering
IC-MinEval generated Platinum Group Metal Case History. IC-CoalEval generated Longwall Coal Case History and Role of Infrastructure. 

D Buchanan

Presenters

Professor Dennis Buchanan (Course Director)

Emeritus Professor of Mining Geology & Senior Research Fellow, Imperial College London 

Professor Buchanan works jointly between the Department of Earth Science and Engineering and the Business School at Imperial College London and will act as the Course Director.   

Professor Buchanan's current research interest lies in addressing the underlying technical principles applying to mineral projects and demonstrating how these influence financial modelling. He has 36 years’ experience teaching mining geology, mineral exploration and mineral project appraisal and is responsible for the MSc in Metals and Energy Finance.  This is a joint degree between the Department of Earth Science and Engineering and the Business School at Imperial College. Professor Buchanan has worked as a Mining Geologist in both gold and platinum mines in South Africa and had wide experience as a consultant to industry, as an expert witness and in designing and delivering short courses for industry

Dr Stephen Neethling
Reader in Minerals Processing, Imperial College London

Dr Neethling has been carrying out research in minerals processing for the last 12 years. His main research interest is in the use of fundamental level models of processes occurring within various minerals separation techniques in order to improve both the operation and design of these systems. In particular, he is working on models and simulators for the froth flotation and heap leaching processes. He has carried out both research and consulting work for a number of major international mining companies.

Mr Chris Worcester
Non-Executive Director on the Board of Stratex International

Chris began his City career in 1993 at Barclays de Zoete Wedd, where he worked in the metals and mining project finance team. In 2000, he joined the Royal Bank of Scotland as Director and Head of Financial Modelling and Analysis, leaving in 2002 to join WestLB Capital Markets, the international investment banking division of WestLB, where he established and managed the global metals and mining team until 2007. Since then Chris has been actively involved in securing funding and investment for resource companies through private, specialist corporate finance company Stone Arch Financial and, more recently, Green Road Capital. Chris is an independent non-executive Director of Stratex International plc. He has a BSc in Chemistry and an MBA in Finance.

IC-MinEval and IC-CoalEval

In the workshop sessions use will be made in the workshop sessions of the IC-MinEval  software, an Excel™-based spreadsheet programme automating all stages required to produce models for a wide range of mineral projects. The functionality of IC-MinEval will be delivered over the internet through the Software as a Service (SAAS) system with InfoMine (http://software.infomine.com/).  Delegates will be expected to have their own laptop computers available and will be provided with wireless access to the Business School's internet. They will need to have administrative rights for their laptops, as there will be the need to install ActiveX to access the system. Delegates will be given access to SaaS a few days before the start of the course. (Delegates with AppleMac and Firefox internet browsers may need some support).  Delegates all have access to the functionality of IC-MinEval through SaaS for a further three weeks after the course. Access beyond that will be available on subscriptions.

Participants will be able to retain digital copies of the spreadsheets that they generate during the course. It produces a Balance Sheet and Profit and Loss account from the cash flows, with tax provisions linked to the Profit and Loss account. Output modules include the base case discount cash flows, as well as key financial ratios and performance indicators such as NPV, IRR payback and maximum cash exposure. Sensitivity analysis can be undertaken on key variables.