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SIMPLIFIED COST MODELS FOR PREFEASIBILITY MINERAL EVALUATIONS

T. W. Camm
US Bureau of Mines
Spokane, Washington

For presentation at the SME Annual Meeting
Reno, Nevada - February 15-18, 1993
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MINING ENGINEERING

which analyze the economic benefits of minerals in a region. tires. lube. capital and operating costs were generated for each capacity. Regression analysis was used to generate capital and operating cost equations for each model based on daily production capacity (see Camm. 1992. These cost models are described in a Bureau publication by Camm (1991). mine and mill cost models were produced to make estimates of the cost to develop mineral deposits in the desert region of the Southwest United States. Users in the Bureau's Resource Evaluation and Policy Analysis divisions. for a discussion of using regression analysis to develop cost models).1 INTRODUcnON The Bureau of Mines conducts studies of the economic impacts of regulations on federal lands. will occupy significantly less space on a computer than alternative systems. professionals outside the Bureau performing similar evaluations.). cost models developed at WFOC for previous studies were adapted for certain cases where feasible. a methodology was developed to estimate operating and capital costs for a mineral deposit given its tonnage. ease of applying escalation factors. grade. steel. and those who need a quick cost estimate for a mineral deposit will find the approach of this simplified method particularly useful. Typically deposit models for regional studies provide tonnage. and the limited design parameters necessary to conduct a cost estimate. Costs for several operations at varying tonnages were estimated. reagents. This information was augmented by data from cost handbooks and references. Spokane. Models were developed using a variety of sources. and manning charts. versatility in applications to a variety of deposit types. two vols. The cost derived using these models should be considered a pre-feasibility type estimate. et aI. one product Flotation. Cost models were developed for each of the mine and mineral processing types listed in table one. equipment. lumber. 1991). two product Flotation. fuel. The format for the cost models in this study was developed at the Bureau's Western Field Operations Center (WFOC). explosives. construction materials. These studies are part of the Bureau Potential Supply Analysis (PSA) program. Site information available included flowsheets. three product Gravity Heap leach Solvent extraction-electrowinning Regression analysis was used to generate capital and operating cost equations for each model in the form shown in the table 2. Additionally. A new approach to cost modeling was developed to provide useful input to the economic evaluation of study areas based on these parameters (Camm and Smith. The modeling approach used in this simplified methodology is particularly well suited for making quick cost estimates where specific design parameters are unavailable. the capacity scenario was based on actual operations. These costs were summarized in the following categories: labor. WA.S. These models are used for Potential Supply Analysis studies by the Bureau. equipment lists. but only an overall cost estimate. with the intent of providing the most accurate representation of costs available for each model. and depth variables. for users who do not require a cost breakdown into each of the individual categories. and electricity. for studies of known and undiscovered resources on Federal lands. Following determination of representative daily capacities for each model and gathering of pertinent data. To meet the needs of these studies. Table 1. A good example of using cost models for PSA studies is a recent report by the Bureau demonstrating the economic impacts of minerals in an area in Southern California by Wetzel. List of Cost Models Infrastructure: Access roads Powerlines Open pit mine models: Small Large Underground mine models: Depth factors Block caving Cut-and-fill Room-and-pillar Shrinkage stope Sublevel longhole Vertical crater retreat Mill models: Tailings pond Autoclave-CIL-electrowinning CIL-electrowinning CIP-electrowinning CCD-Merrill Crowe Float-roast-leach Flotation. A total cost equation was also included for each model. a separate category for sales tax was included. In addition. and by the Bureau Cost Estimating System (CES) (U. DESCRIPTION To provide engineering analysis for PSA studies. grade. Cost models for access roads and powerlines were also included. (1992). Wherever feasible. 1987. Bureau of Mines. Equations for . The key benefits of the method are: demands less engineering background of user. and depth. Table 1 lists the models developed.

99 Lube = 11. The following calculations use the equations from table 2 for a CIP mill. the CIP-electrowinning model provides an example of how each model is presented. This pre print provides an introduction to cost models developed for Bureau Potential Supply studies.851 Sales tax = 14.1% difference due to rounding in regression equations.831.000 to 20. This model is designed for evaluating oxide gold deposits. 1. using a feed rate of X = 7. Loaded cathodes are removed.1 oz/st Au was assumed. a schematic diagram is also provided to illustrate the mine method. with a recovery of 89% Au.4(7. while the undersize is sent to a thickener. Depth factor costs should be added to the cost equations for the underground mining model being evaluated.35 Steel = 0. Costs are summarized in table 2. a grade of 0. The CIP-electrowinning process is most often used for processing oxide gold ores with little or no byproducts. Table 4 provides the total cost equations for depth factors for underground mine models. Figure 2 illustrates a simplified f10wsheet for a CIP mill tlowsheet. Carbon is moved countercurrent to the slurry.18 Electricity = 26. For each underground model. An expanded discussion.75 Sales tax = 0.800(7. and sent to the refining furnace.876 = 1. Capital cost estimate: Labor = 114. For this model.429)°·527 = 12. and tailings ponds.429)°·528 = 4. then a cone crusher.068 If an evaluator does not require the cost breakdown provided using the above equations. and tailings ponds. and eleven mill models. is found in Bureau IC 9298 by Camm (1991).04 Reagents = 2.429 st/d. followed by sample calculations using the equations from table 2.25 Total from above categories = $7. The corresponding total cost equations are summarized in table 3. Crushed ore is then ground in a rod mill and sent through cyclones. These are illustrated in figures 3-5.600(7.429)°·540 = 45. where the electrowinning cells are used to plate gold onto steel wool cathodes. and for variations in depth of mining for the underground models.303 = $7. Adjustment factors were also developed for variations in haulage distance for the open pit models.60 Equipment = 21.16n.429)~. Also included are simplified f10wsheets for each mill model. where a dore is produced for shipment. total cost equation: 45. EXAMPLE To demonstrate the individual cost models.993(7. The discussion describes the design used for the model. treated with dilute sulfuric acid.797.) SUMMARY Cost models have been developed for two open pit models. The loaded carbon from the CIP circuit and the carbon columns is sent to the stripping tanks.603 Construction material = 55.596. six underground mine models.055.831. access roads.8(7.16/st ore (mill feed) Using the total cost equation only: Total = 105(7.429)~·641 = 1. Pregnant strip solution is sent to the electrowinning circuit.429)°·550 = 19.429)~·463 = 0.879. the slurry is fed to the CIP circuit. Mine-run ore is initially crushed with a jaw. Additional models are available for estimating costs of access roads.068/45. After leaching. while the underflow goes through a series of agitated leach tanks.429)~·057 = 0.016. The oversize is sent to a ball mill.600(7. Stripped carbon is regenerated in a kiln and returned to the circuit. which consists of a series of tanks with high efficiency agitators.05/st ore (mill feed) (7.586.429)°·0 = 2.75(7.05 = 1. Barren slurry from the last tank of the CIP circuit is sent to the tailings pond.0.429)°·543 = 7. the total cost can be calculated using the total cost equation: Total = 372.360 Total from above categories = 45.000 st/d. The overflow from the thickener is sent to a series of carbon adsorption columns.6% difference due to rounding in regression equations.429)~.429)~·463 = 0.6(7.2 each category listed above that were appropriate for each model were calculated in this form. The cost equations are valid for ore tonnage capacities of 1.800(7. as illustrated in figure 2.797. powerlines.000(7.001.409(7. Figure 1 shows a typical schematic.) Operating cost estimate: Labor = 484(7. which moves by gravity from the first to the last tank.600(7. power lines.999 Equipment = 145.429)°·545 = 1.712.255 Steel = 42.429)°·0 = 0. and full set of models.876 (Comparing totals using individual cost categories vs. Cost curves summarizing the total cost equations for capital and operating costs for each model were developed. . Each model includes a brief discussion and a summary table of cost equations as shown in table two.365 = 1.

057 105(X)-O·303 ..000 st/d) Capital cost.550 42. Total .. and M.0 11. .... (in two parts).. R..545 3n. ''The Development of Cost Models Using Regression Analysis.. Bureau of Mines Cost Estimating System Handbook.543 NAp NAp 14... Smith.. California..800(X)0.. W.. Equipment .' 1987." Paper in Proceedings of the Second Canadian Conference on Computer Applications in the Mineral Indust!)'. Table 2. C.. by R.. 4( X) -0. W. Blackman. Sept.. pp... 2... and A. NAp Not applicable...000-20. BuMines IC 9142.. and R..6(X)-O·463 0..... T. N... . SME Annual Meeting...800(X)0... BC).993(X)0.." Preprint no.. U..75(X)0... ..... (in two parts)....3 REFERENCES 571.0 0... Steel . Operating cost. 631 pp.... L.. X = Capacity of mill in short tons (st) per day mill feed. Benjamin. Vancouver.527 145.600(X)0. . 15-18..' 1991. $/st 484(X)-O·641 21.. Mineral Processing... .600(X)0....... T. 1992. T. L.. CIP mill model (capacity range 1. Electricity . Pakalnis. British Columbia... Camm. Camm.463 NAp 26..... Bureau of Mines.. 1992. .35 pp. $ 114. BuMines OFR 56-92.S..000(X)0. Reagents .528 NAp 55. Wetzel.... "A Review of Cost Estimating Methods for Prefeasibility Type Studies... BuMines IC 9143.600(X)0... 1991. Sales tax ...... BuMines IC 9298. vol. 1987. Simplified Cost Models for Prefeasibility Mineral Evaluations.540 Metric equivalent: st x 0. Mular (Univ...... Construction material . 565 pp. Economic Analysis of the Minerals Potential of the East Mojave National Scenic Area...907 184 .. 92-48. 563- Category Labor .. Bureau of Mines Cost Estimating System Handbook.8(X)-O·365 2... Poulin. 3 pp..metric ton (t). Apr. Schantz. .. Surface and Underground Mining.. .409(X) -0... . 1. 79 pp. Lube .. 2.. . D... .... ed..

$ + $/acre Dam. $ Operating cost. infmstructure. Depth factor.OO163(D) Metric equivalents: acre x 4046. 76.667 82.917 71. $/st Access road capital cost.3048 = m.0(X)-Q·206 1.000(X)O. NAp Not applicable. mi x 1.500(R) l48.000(X)o.9(X)-Q·160 41.62o 115. $/linear ft Liner\ $/acre Cost equation + 371 + 180(D)(X)o.9(X)-Q·181 51.000(X)O.000 + 1. D = Depth of shaft to bottom of ore body in ft.400(P) 310.250.000(X)O.414 5. 14(X)-Q·148 64.600(X)O.S52 45. R = Length of road to construct in miles (mi). X = Capacity in st per day. L = Length of impoundment dam to construct around tailings pond in ft.1 97.000(X)O. X = Capacity of mine in st per day.529 296.907 184 = t.800(Xr59 48. ft x 0.670(X)O. P = Length of powerline to construct in mi. $ Underground mine models: Block caving Cut-and-fill Room-and-pillar Shrinkage stope Sublevel longhole Vertical crater retreat Mill models: Autoclave-CIL-EW CIL-EW CIP-EW CCD-MC Float-roast-Ieach Flotation.404 + 2.200(P) 304.900(R) 298.702 83.S40 414. st x 0.907 184 = metric ton (t).770 50. Operating cost.5(X)-Q·223 3.4 Table 3.343/(X) + 0. two product Flotation. $/mi: 40 ft wide 60 ft wide 80 ft wide Powerline capital cost.500(X)O.783(A) l61(L) 5(L) + 35. $/mi: 20 ft pole height 30 ft pole height 40 ft pole height Tailings pond capital cost: Tailings pond.000(X)o. 1Liners are only required in certain states.440(D)/(X) + 0.4{.500(X)0.2(X) -Q.s96 Table 4.5(X)-Q·l7l 74. 1(X)-Q'!96 84. 121(X)-Q·33s 149(X)-Q·3s6 153(X)-Q·344 67.609 344 = km. A = Area of tailings pond required in acres.300(X)0. tailings equations Cost model Underground mining depth factor: Capital cost.512 14.747 78.4(X)-Q·217 279(X)-Q·294 35.400(P) 146.515 2.OOO(X)O.0(X)-Q.500(X)O.000(X)0.600(X)o.600(X)O.00(X)-Q·14S 96.2Bl 105 (X)-Q·303 128(X)-Q·300 10 1(X)-Q·24{.000(R) l12.644 179.8(X)-Q·364 31. three product Gravity Heap leach Solvent extraction-EW Metric equivalent: st x 0. $/st 160.856 = m2.584 481. one product Flotation.708 135.74S 372.79O(A) .SS2 92.600(X)O. Mine/mill total cost equations Cost model Open pit mine models: Small open pit Large open pit Capital cost.200(X)O.

-Cut-and-filllllchen1atic.-CIP mill flowlllheel .5 Figure 1. Ore Dore' TYPICAL CIP/ELECTROWINNING CIRCUIT Figure 2.

000 100. ""..000 1.000 CAPACITY.000.000 200.6 1...000 V 100..t-. ~ ui l- (/) 0 ).-Open pit captial and operating costs (average 1989 dollars). sUd material OPEN PIT CAPITAL COSTS 10 -----..-----.000 200.000 / 1§ /V :s /V "E V '~" 0 . .r--- . ---- o 1.000 100.. r-- r------r---- t--..000 10.000 ~ U v ------- V ~ ---- 1.000 10. sUd malerial OPEN PIT OPERATING COSTS Figure 3...-- U ~ 10.000 CAPACITY..

000 100.~R-oo..000 10.m-a-l-n-jc t----t-----l-+-++--+--I-/---1fY '<::::>1'/-+....-. sUd UNDERGROUND MINING OPERATING COSTS Figure 4...."-._..-/ ....-+""+-.... Shrinkage ~.-..~/ ./ ~.:/.<~ -:. 1... " /~/ L'/ .// caving ~ 1:g II Cut and --100. VCR . . ~ r-- i:g ~ -- ~ I~ - 10 '::.. pillar Block --'" Il. .: ..../""'---+-/7"''-1 pillar ~ / 1_- E - I ~ ~ . /~ 8 // // / .... .- ~ 1--- r----.-Underground mining capital and operating costs (average 1989 dollars).. o caving 1 100 1..::..000 CAPACITY. Room and -. sUd UNDERGROUND MINING CAPITAL COSTS 100 ~ ----- I'-- --.....000 -j-_ _'-_-'---L---'-+_ _L-_-'-----'--'-+_ _'-_-'----'---'-I 100 1..-"-+--..+::/"..""'...-+-++---+--I-+++---+---} Block - ..-r--.- 10./ ...000 CAPACrrv...... j------Shrlnkage " .000 100.«---+---::-'-I-+-+-+---t----I'-+--t-I --. I Sublevel longhole '..' Sublevel Ionghole .. / .....-'~ f-"" ...000 10.000 -j---t--+-t-t-+--I--+ till -1--//... ~ CJ z ~ UJ Cut and fill r-::::: ~..j.J f<..../'"' . ".000 --t---t--+--.... ~~~ '" -'J-.7 1---I-----1.

.......... >1"--.. ~~ .... sVd mill feed MILLING CAPITAL COSTS 100 .... LU .....000 r--......." ..... :5 CIi c..I~ .. .....: ~ .000 .. .~ iii . 1-.. VCIP ..... 15 "0 .000 CAPACITY. 3-prod uct II otation I-product fl olallon H~leach~~ 2-product IIolallon r--... c( ..) ~ (.~ h.... 0 " r--... k~/../~..-: ..000 CAPACITY..../ L-... .. t-:-: r--. .".J~ I>?' . sVd mill leed MILLING OPERATING COSTS Figure 5.'-.... .-'/ V ./ / j/. I-product IIotaUon /< ' 100. i"- 100 1.. .. /. Gravity 1.. . 10. ..." m :l 0 I -. " .~ ~~ <...) .-Milling capital and operating costa (average 1989 dollars)... "~~ ..~/' /.r.. lcIc-. .... ~........' . .000 I I :~ bll/ v'" . ...8 1. ''0.000 1. ..000 ~ 0 "0 "0 FIoavroaS1l1iich ..- ".!l .-v.- 10.. .....000 100 10. -::- ... ~ 'S. ~ ..Autoclavelc'il ... FIoaVroastlleach CCO CIP t--.. ...3-product flo tallon /' /~ 2-prOduct i1 otallon v.. Autoclave/Cll .000 SXIEW t-100...... CIi tii 8 ~ 10 ~~ I:::--. Z ~ ~ a: c.. ~ .. .· v:<..V CCO ...~ ~ .. ..- tii 0 (. ' ~ V ~~. ::-. . ..Heap leach V . K I'~-.. . . .000... ...... Gravity .000 100.