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24-MMP-A4 Mine Valuation and Mineral Resource Estimation: December 2018

Nivaar worked solution (AI-drafted; not reviewed by a licensed engineer)

  1. Question 1 Geological Conditions and Controls on Resource Estimation — Vein vs. Porphyry
  2. Question 2 Evolution of Section, Polygon and Inverse-Distance-Squared Methods to Geostatistics
  3. Question 3 Ultimate Value of Mined Materials — Market Conditions and Pricing
  4. Question 4 Capital and Operating Cost Estimation — O'Hara's Method and Mine-Life Rule
  5. Question 5 Net Smelter Return, Net Smelter Value and Net Profit Interest
  6. Question 6 Estimation of Revenue Including Smelter Contracts
  7. Question 7 Taxation, Cash Flow, Sensitivity and Risk Analyses
  8. Question 8 Extraction Variables Including Cut-off Grade
  9. Question 9 VMS and SEDEX Deposit Models — Geologic Setting
  10. Question 10 VMS and SEDEX — Typical Mining Methods and Operating Costs
  11. Question 11 Porphyry Deposit Model — Canadian Cordillera
  12. Question 12 Nested Spherical Variogram — Gamma Values
  13. Question 13 Variograms, Trends and Anisotropy
  14. Question 14 Concentrate Transportation — Eastern Canada vs. Pacific Rim
  15. Question 15 Elements of a Copper Smelter Contract
  16. Question 16 Why Molybdenum Rivals Copper Revenue Despite Lower Grade
  17. Question 17 NSV and NSR — Definitions and Mine-Engineer Application
  18. Question 18 Porphyry Copper NSR Chain Calculation
  19. Question 19 High-Grade/High-Variance vs. Medium-Grade/Low-Variance Deposits
  20. Question 20 The McKelvey Diagram
  21. Question 21 NI 43-101 Terminology
  22. Question 22 IRR, NPV, PV Factors and Profitability Index — Definitions
  23. Question 23 Crude 5%/50% Interpolated IRR Estimate
  24. Question 24 Refined IRR via Adjacent 5% Table 6 Brackets
  25. Question 25 IRR vs. NPV Sketch Graph
  26. Question 26 NPV of 6A and 6B at the 15% Corporate Minimum Rate
  27. Question 27 Profitability Index of 6A and 6B
  28. Question 28 Similar Project Lives — Does This Negate the Case for IRR?
  29. Question 29 IRR vs. NPV When Lives, Capital Costs or Rates of Return Differ

Start with Question 1 →

EGBC National Exam — Mining and Mineral Processing Engineering, 09-MMP-A4 Mine Valuation and Mineral Resource Estimation, 2018-Dec. 3 hours duration; one handwritten 8.5×11 in reference sheet permitted (not an open-book exam); only approved Sharp or Casio calculators allowed. Question 1 is compulsory (40 marks, parts 1.1–1.8); candidates then select THREE of the five optional Questions 2–6 (20 marks each) to complete the paper.

Reference texts: Isaaks & Srivastava, An Introduction to Applied Geostatistics (variogram modelling, kriging, anisotropy); Hustrulid, Kuchta & Martin, Open Pit Mine Planning and Design (mine valuation, NPV/IRR and cut-off grade methodology); Gentry & O'Neil, Mine Investment Analysis (smelter/refining contract terms, net smelter return, taxation and risk); Guilbert & Park, The Geology of Ore Deposits, and Evans, Ore Geology and Industrial Minerals (VMS/SEDEX and porphyry deposit models); SME Mining Engineering Handbook, 3rd ed. (mineral exploration/evaluation stages, ore reserve classification); CIM Best Practice Guidelines and NI 43-101 (Canadian Securities Administrators).