Here is a link to a most unusual site dealing with mining. I have not previously seen this site, but stumbled across it while searching the 100s plus listing in Google. The site is called Mining Company Builder. It is the product of Murray Lytle who describes himself thus:
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Murray grew up on a ski hill in British Columbia, Canada and lived his formative years in the rather large and sinister shadow cast by Cominco Ltd. Skiing would have been a lot more fun as a career but the salary scope at the North Star Ski Hill was limited so he left town to experience the big city of Vancouver and obtain an engineering degree in the process. Metaphorically shaking the dust from his feet, it was determined that Cominco and Kimberley would play a very limited role in the development of his future. Six years later he was back in Kimberley working for Cominco. Some hooks are hard to pull out. And the year he spent as an engineer-in-training in Kimberley was the first year that the snow failed and the ski hill didn’t open! It was a portent whose significance was missed.
The advice on the site is eclectic to say the least, but it is fun to read. Here is how he describes the financing of a mine:
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Project finance is not one of the areas in which I have a lot of experience or in-depth knowledge. In fact, my financing needs were managed by playing my father off against my mother for gas money and later by pleading with my wife for lunch money. It has been a fairly basic existence so far.
On the tricky issue of what should go into your NI 432-101 Feasibilty Study, he proffers this advice and insight:
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There are really only three issues that need to be settled in a feasibility study [he actually lists four, so I repeat them all]:
1) Does the technology exist to accomplish the goals established for a given project? There is no sense in establishing a project to mine gold on the moon just because you got chased off the earth by excited environmentalists if there isn’t a cab to take you there. Some projects are almost that weird.
2) Will the project generate revenues that pay back all the capital and operating costs plus generate a return for the investors? This can be a bit tricky for mining properties and often the details are kind of skipped over. For example, if a project has been explored for 8 years before a decision is made to conduct a feasibility study when is year 0 for the economic evaluation?
3) Does anyone in the world want to buy what is going to be produced and will they sign a marketing letter of intent? This is a very big issue for lots of industrial minerals and much less so for a gold mine. Gold seems to always find a market.
4) Will the government grant a permit to develop the project? Think Windy Craggy in British Columbia or Tambo Grande in Peru. This question involves environmental and social development sensitivities which rightly have to be addressed in a way which improves the life of the general population in the area of the project as much as it does the company executives living in relative luxury thousands of miles away.
There is lots more of this ilk at the site, called, as noted above Mining Company Builder
