Financial Valuation of Mine Closure Alternatives

Authors: Drebenstedt, C Paper is not available for download Contact Us

DOI https://doi.org/10.36487/ACG_repo/605_42

Cite As:
Drebenstedt, C 2006, 'Financial Valuation of Mine Closure Alternatives', in AB Fourie & M Tibbett (eds), Mine Closure 2006: Proceedings of the First International Seminar on Mine Closure, Australian Centre for Geomechanics, Perth, pp. 499-508, https://doi.org/10.36487/ACG_repo/605_42



Abstract:
Remediation and aftercare jobs in the mining industry are often characterized by their long-term nature. The commercial evaluation, e.g. behavioural alternatives, are therefore based on an inter-temporal valuation approach. As the evaluated objects usually do not create revenue, the valuation criterion will be the expense parameter that is expressed as the cumulative cash value of all costs and the investments still to be decided upon and thus relevant for the payments to be made. This expense parameter will have to be interpreted as a negative revenue item, so that the valuation approach introduced herein is a special case of the approach used to determine the capitalized value of potential earning, which is dominating in the mining industry. This paper introduces typical reasons for a valuation, the valuation model and the conclusions for the model drawn from a sensitivity analysis. Problems arising when the model is applied are highlighted in a case study.

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