Day 1 - Strategic Management, Mineral Geosciences and Project Evaluation - Dennis Buchanan

TimeSessionPresenter
13:00-14:00
 
 
 
 
 
 

1. Value Creation in Mineral Projects
The cycle of value creation in mineral projects. Exploration Stage. The pyramid reflecting the evolution of a gold mineral exploration and evaluation programme. Drivers – Commodity Prices. Resource Base and Asset Life – Mineral Resources. Synergies and Portfolio Optimisation. Single project mining company stages of development and funding options. Funding Options for Mineral Projects  - Pre-Initial Public Offering, Listing, Joint Venture Agreement and Project Finance. Multiple-partner modelling.

D Buchanan

14.00-15.00

 

 

2. The origin of mineral deposits and their classification.
Terminology. Strategic minerals. Chemical composition of the Earths crust. Geochemically abundant and scarce metals. Mineralogical barrier. Relationship between value and tonnage. Diversity – REE, Battery Metals

D Buchanan

15.00-16.00

3. Resource Evaluation
Sampling. Diamond drill rig, crowns, core and core storage. Process Mineralogy. Concepts around Geological Continuity. Polygons of Influence and Inverse Distance.

D Buchanan

16.00-17.00

4. Resource Evaluation
Geostatistical Methods Experimental semi-variogram. Variogram showing the relationship ỵ(h) which relates the semi-variance of sample differences to distance between samples. Resource block model. Grade-tonnage relationships. Reserve and Resource Definitions. Drill spacing. Evaluation versus Production. Break-even and cut-off grade

D Buchanan

Introduction to Mining for Bankers
Day 2 - Project Evaluation - Dennis Buchanan

TimeSessionPresenter
13:00-14.00
 
 
 
 
 
 
 
 

5. Metals & Energy Project Appraisal & Finance

Nomenclature of documentation generated  in mineral project development. IPO Prospectus, SEDAR  and NI 43-101.Preliminary Feasibility Study (PFS) - Elements and Characteristics. Cost Estimation. Relationship Cost to Capacity.  Asset Optimisation. Full Technical Feasibility Study (FTFS)– Elements and Characteristics. Engineering Design Stages . Feasibility Studies  and the Information Memorandum. Construction. Construction Monitoring. Production Monitoring. Project Finance Parameters.

D Buchanan

14.00-15.00

6. Minerals Engineering – Surface Mining Methods Metal Reconciliation and Mineral Resource Management. Grade control.  Dilution. Mass balance. Pit Optimisation. Slope stability. Blast hole patterns, explosives and breaking.  Equipment

D Buchanan

15.00-16.00

7. Transition from open pit to underground. Shaft sinking. Production ramp-up and profile in the transition from surface to underground mining. As the pen-pit matures, the number of working faces becomes limited so production drops and this needs to be compensated for in the ramp-up of block caving. Copper projects case histories - Palabora, Chuquicamata and Oyu Tolgoi

D Buchanan
 
 
 
 
 
 

16.00-17.00

 

 

 

8. Underground Mining Horizontal or sub-horizontal  narrow and wide tabular, low dipping ore bodies. Room and pillar, Long hole, Vertical or sub-vertical ore bodies. Sublevel caving, Shrinkage stoping, Cut-and-fill, Drift-and -fill. Mechanisation. Block and panel caving. Case histories

 
D Buchanan
 
 
 
 
 
Introduction to Mining for Bankers
 
Day 3 - Project Evaluation – Stephen Neethling and Dennis Buchanan
 
TimeSessionPresenter

13.00-14.00

9. Mineral Processing The central role of mineralogy in effective mineral processing. Comminution. Liberation. Physical and chemical separation processes. Solid-liquid separation. Waste disposal.

S Neethling

14.00-15.00

 

 

10. Extractive Metallurgy – Copper 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. The relationship between smelter contracts and optimum operating conditions.

S Neethling

15.00-16.30

11. Extractive Metallurgy – Precious Metals Gold cyanide leaching. Gold recovery by CIP/CIL and electro- winning. Platinum processing including smelting, base metal refining, chromite recovery and subsequent precious metal refining.

S Neethling

16.30-17.00

12. Constraints on Mineral Resource Development

ESG – Environmental impact, social license and corporate governance.  Environmental impact assessment. Sustainable Development and the Moral Case for Mining. Occupational Health and Safety. Cost of Environmental Compliance and Closure Provision. Site Visits and Due Diligence

D Buchanan


Day 4 - Cash Flow Modelling and Financial Accounting – Dennis Buchanan

 TimeSessionPresenter
13:00-14.00
 
 
 
 
 
 
 
 
 

13. Introduction.

Principles of DCF Modelling. Discount rate. Net Present Value. Internal Rate of Return. Payback Period and Choice of Discount Rate. Impact of different discount rates over time. Cash flow for a mineral project. Scenarios illustrating the range of economic performance indicators. Case history of gold operation.  Setting up base case. Nominal versus real.

D Buchanan
 
 
 
 
 
 
 
 

14.00-15.00

14. Valuation of Companies

Terminology. Share performance metrics. Alternative methods – DCF, comparable transactions and appraised value method. Treatment of sunk capital. Acquisition cost. Accounting impairment.

D Buchanan

15.00-16.00

15. Analysis of Risk and Uncertainty

Sensitivity analysis. Application to Monte Carlo simulation techniques. Treatment of multivariant systems. Brownian motion and probabilistic modelling. Crystal Ball modelling of gold project. Precision versus accuracy.

D Buchanan
 
 
 
 
 
 

16.00-17.00

 

 

16. Project Finance and the Cost of Equity Weighted average cost of capital (WACC). Integrated economic and accounting model for a simple gold project demonstrating the interrelationship between DCFs and the financial accounts. Capital asset pricing model. Optimisation of gearing. Project Finance cover ratios Demonstration of IC-MinEval. Treatment in the financial model of profits after tax before interest (ATBI), profit before interest and tax (PBIT),  profit after interest before tax (PAIBT) (and profit after interest and tax (PAIT).

 
D Buchanan

Day 5 - Mining Finance – Dennis Buchanan

TimeSessionPresenter
13:00-14.00
 
 
 
 
 
 

17. Case History - Base Metals

Open pit nickel mine. Sample of DCF model worksheet. Annual cover ratios. Scenario analysis. Optimisation of gearing. Cost estimates. Different stakeholders. Reserve tail. Convergence of technical and financial risk

D Buchanan
 
 
 
 
 
 
 
 
 

14.00-14.30

18. Case History – Iron Ore

Iron ore minerals – Hematite and Magnetite. Magnetite and ilmenite. Magnetite, vanadium and ilmenite. Mine blocks. Product specifications. Product specifications. Yield optimisation curve. Infrastructure.

D Buchanan

14.30-15.00

19. Case History – Diamonds.

Geological settings and pricing. Alluvial deposit case history. Evaluation of projects. Instability of DCF models. Primary kimberlitic projects.

D Buchanan
 
 
 
 

15.00-16.00

 

 

 

 

 

20. Share Structures

Deal structure, Share price and stakeholder valuations associated with the progression from a private placement to undertake exploration through to an Initial public offering to fund evaluation drilling. Treatment of options purchased for below an issue price and then distribution of shares held by stakeholders when exercised if this is below an IPO price. Consideration of monies added to the company treasury during corresponding funding stages.

Spreadsheet-based workshop session

 
D Buchanan
 
 
 
 
 
 
 
 
 
 
 
 

16.00-17.00

 

 

 

21. Metals streaming

Comparison between Different Sources of Funding for the Development of a Mining Project. Case History -Aljustrel copper-zinc-lead-silver in Portugal. Metals Streaming Companies

 Consolidation of course deliverables.

D Buchanan