$ r n

100 10% 10 259

Profit and Loss Statement (Case Study) for Mine Development 100 10% 10 39

Stage Construction Operation

0. Capital Cost CAPEX) year -2 -1 1 2 3 4 5 6 7 8 9 10 Total -2 -1 1 2 3 4 5 6 7 8 9 10
Mining Stripping, Equipments etc.) million. $ 20 20 40 Ore Body CLow graded 500 500 500 500 500 500 500 500 500 500
Processing plant, equipment, tailing) million. $ 30 30 60 Ore body B medium graded) 300 300 300 300 300 300 300 300 300 300
General construction, lands, etc. million. $ 10 10 20 Ore body A high grade ore 200 200 200 200 200 200 200 200 200 200
Total million. $ 60 60 120 Average Ore Grade 10% 10% 10% 10% 10% 10% 10% 10% 10% 10%
Construction Operation Concentrate Production 160 160 160 160 160 160 160 160 160 160
1. Production year -2 -1 1 2 3 4 5 6 7 8 9 10 Total
ore 000 t 200 200 200 200 200 200 200 200 200 200 2,000
Ore body A Mining Production
grade 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15%
ore 000 t 300 300 300 300 300 300 300 300 300 300 3,000
Ore body B kt
grade 10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 1,000
Mining Plan ore 000 t 500 500 500 500 500 500 500 500 500 500 5,000 Plactice
Ore body C
grade 8% 8% 8% 8% 8% 8% 8% 8% 8% 8% 8% Ore body A high grade: 2 mill. t
ore (a) 000 t 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 10,000
A+B+C grade 10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10%
Total Ore body B mid. gr ade: 3 mill. t
metal 000 t 100 100 100 100 100 100 100 100 100 100 1,000
500
recovery rate 80% 80% 80% 80% 80% 80% 80% 80% 80% 80% 80%
Concentrate concentrate (b) 000 t 160 160 160 160 160 160 160 160 160 160 1,600
Production grade 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50.0%
Ore body C low grade : 5 mill. t
metal 000 t 80 80 80 80 80 80 80 80 80 80 800 A
Note: smelting recovery should also be accounted for A as "payable metal"
1. Production year -2 -1 1 2 3 4 5 6 7 8 9 10 Total 0

Concentrate (b) 000 t 160 160 160 160 160 160 160 160 160 160 1,600 Aver age Ore grade (Feed)
15%
2. Sales year -2 -1 1 2 3 4 5 6 7 8 9 10 Total
Metal Price $/metal t 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 Plactice 10%
Metal Valuemetal t million $ 160 160 160 160 160 160 160 160 160 160 1,600
Smelter feeTC 30% 48 48 48 48 48 48 48 48 48 48 480 5%
Freightinsurance (b) 50$/t 8 8 8 8 8 8 8 8 8 8 80
Gross Revenue --NSR million $ 104 104 104 104 104 104 104 104 104 104 1,040 0%

3 00
kt
3. Operating Cost (OPEX) year -2 -1 1 2 3 4 5 6 7 8 9 10 Total
Direct cost million $ Concentrate Production
Mining (a) 20$/t 20 20 20 20 20 20 20 20 20 20 200 2 00
Processing (a) 30$/t 30 30 30 30 30 30 30 30 30 30 300
administration miningprocess 10% 5 5 5 5 5 5 5 5 5 5 50
Total 55 55 55 55 55 55 55 55 55 55 550 1 00
Cash Cost $/metal t 1,388 1,388 1,388 1,388 1,388 1,388 1,388 1,388 1,388 1,388 1,388 (++)/A
Depreciation for CAPEX5-10yrs 12 12 12 12 12 12 12 12 12 12 120
Total Opex+ 67 67 67 67 67 67 67 67 67 67 670 0
1 2 3 4 5 6 7 8 9 10
Full Cost $/metal t 1,538 1,538 1,538 1,538 1,538 1,538 1,538 1,538 1,538 1,538 1,538 (+++)/A
Mining ore Production 10,000 000 ore t
4. PROFIT -2 -1 1 2 3 4 5 6 7 8 9 10 Total Concentrate Production 1,600 000 conc t
Profit (2.-3.) million $ 37 37 37 37 37 37 37 37 37 37 370 Revenue (NSR) 1,040 million $
Tax 20% 7 7 7 7 7 7 7 7 7 7 74 Operating Cost 670 million $
Profit after tax million $ 30 30 30 30 30 30 30 30 30 30 296 Profit 370 million $

DCF NPV 118 million $

5. Cash-flow year -2 -1 1 2 3 4 5 6 7 8 9 10 Total IRR 28%
Profit after tax + DepreciationCAPEX -60 -60 42 42 42 42 42 42 42 42 42 42 296 Payback Period 3 years
Project DCF
NPV discout rate= 10% -60 -55 34 31 28 26 23 21 19 18 16 15 118
Project IRR 28%
Cash flow accumulation -60 -120 -78.4 -36.8 4.8 46.4 88 129.6 171.2 212.8 254.4 296
Payback Period


CAPEX) -2 -1 1 2 3 4 5 6 7 8 9 10 -2 -1 1 2 3 4 5 6 7 8 9 10
20 20 40 C 500 500 500 500 500 500 500 500 500 500
30 30 60 B 300 300 300 300 300 300 300 300 300 300
10 10 20 A 200 200 200 200 200 200 200 200 200 200
60 60 120 10% 10% 10% 10% 10% 10% 10% 10% 10% 10%
160 160 160 160 160 160 160 160 160 160
-2 -1 1 2 3 4 5 6 7 8 9 10
200 200 200 200 200 200 200 200 200 200 2,000
A
15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15%
300 300 300 300 300 300 300 300 300 300 3,000
B
10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10%

1,000
500 500 500 500 500 500 500 500 500 500 5,000
C A 20 0 Zn1 5%
8% 8% 8% 8% 8% 8% 8% 8% 8% 8% 8%
(a) 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 10,000
A+B+C
10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10% B 3 00
Zn1 0 %
100 100 100 100 100 100 100 100 100 100 1,000
80% 80% 80% 80% 80% 80% 80% 80% 80% 80% 80% 500
(b) 160 160 160 160 160 160 160 160 160 160 1,600
C 5 00
50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50.0%
80 80 80 80 80 80 80 80 80 80 800 A Zn 8 %

-2 -1 1 2 3 4 5 6 7 8 9 10 0

(b) 160 160 160 160 160 160 160 160 160 160 1,600

15%
Revenue -2 -1 1 2 3 4 5 6 7 8 9 10
/ 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 10%
160 160 160 160 160 160 160 160 160 160 1,600
TC 30% 48 48 48 48 48 48 48 48 48 48 480 5%
(b) 50$/t 8 8 8 8 8 8 8 8 8 8 80
--NSR 104 104 104 104 104 104 104 104 104 104 1,040 0%

(OPEX) -2 -1 1 2 3 4 5 6 7 8 9 10 300

(a) 20$/t 20 20 20 20 20 20 20 20 20 20 200
200
(a) 30$/t 30 30 30 30 30 30 30 30 30 30 300
10% 5 5 5 5 5 5 5 5 5 5 50
55 55 55 55 55 55 55 55 55 55 550 100
Cash Cost / 1,388 1,388 1,388 1,388 1,388 1,388 1,388 1,388 1,388 1,388 1,388 (++)/A
5-10 12 12 12 12 12 12 12 12 12 12 120
+ 67 67 67 67 67 67 67 67 67 67 670 0
1 2 3 4 5 6 7 8 9 10
Full Cost / 1,538 1,538 1,538 1,538 1,538 1,538 1,538 1,538 1,538 1,538 1,538 (+++)/A
10,000
PROFIT) -2 -1 1 2 3 4 5 6 7 8 9 10 1,600
(2.-3.) 37 37 37 37 37 37 37 37 37 37 370 1,040
20% 7 7 7 7 7 7 7 7 7 7 74 670
30 30 30 30 30 30 30 30 30 30 296 370

CF NPV 118
-2 -1 1 2 3 4 5 6 7 8 9 10 IRR 28%
CAPEX -60 -60 42 42 42 42 42 42 42 42 42 42 296 Payback Period 3
Project DCF
NPV discout rate= 10% -60 -55 34 31 28 26 23 21 19 18 16 15 118
Project IRR 28%
-60 -120 -78.4 -36.8 4.8 46.4 88 129.6 171.2 212.8 254.4 296
Payback Period A(payable metal)