Professional Documents
Culture Documents
Pre-evaluation study
From QueensMineDesignWiki
Contents
1 Introduction
2 Purpose of pre-evaluation study
3 Study contents
4 The project team
5 Level of accuracy
6 Risk assessment
7 Study results
8 Comments and suggestions
9 See also
Introduction
The Venture analysis, also called the pre-evaluation study has the following characteristics:
It involves 0% - 2% engineering.
Cost estimate accuracy is "order of magnitude," with costs based on experience, allowances, and rules of
thumb.
Bottom line contingency is unspecified, as it would imply an accuracy that is not supported in the study.
Normal time required for submission of draft report is ±2 months.
Normal cost range (if no supporting studies are included) is ±$25,000.
Study contents
A venture analysis will typically consist of a few pages of text, some general schematics and figures, and order-of-
magnitude cost estimates based on various assumptions, experience, benchmarks, and industry standards. It is more of a
presentation of the project knowledge available to date, rather than a design document.
Level of accuracy
The main purpose of this study is to determine if the property has sufficient potential to justify a decision to carry forward
into more detailed study phases (typically a financial commitment less than $1 million plus any ongoing exploration costs)
and to provide some idea as to the potential benefits, opportunities, and risks related to the project. If sufficient ore
resources have not yet been identified, the study will provide some indications as to the ore resource quality (tonnes and
grade) that will be required in order to justify moving forward into a scoping study.
This level of study is “order of magnitude” at best. Any scope of work, schedule, and cost information will be based on a
number of high-level assumptions, industry standard performance figures and costs, vendor equipment productivity
information, and general experience with similar projects.
Risk assessment
No formal risk assessment is carried out at this level of study. The focus is to identify any major project risks that may
become “fatal flaws” for the project. These risks may include:
Study results
A venture analysis can have three possible outcomes:
Go Decision:
Continue exploration work on the mineral discovery in order to upgrade the resource to the target
levels identified in the scoping study.
Undertake a pre-feasibility level study if the mineral resource targets have already been (or are
likely to be) achieved.
https://minewiki.engineering.queensu.ca/mediawiki/index.php/Pre-evaluation_study 2/3
11/27/21, 12:11 PM Pre-evaluation study - QueensMineDesignWiki
Suspend further work on the mineral discovery pending possible improvement in economics or
conditions (increased metal prices, improved access to and infrastructure in the general area,
change of government, etc.)
No Go Decision:
Abandon further work on the mineral discovery
Ensure the overall scope of the project is clearly identified, including items such as supply of services to the
site, transport of personnel/materials to and from the site, shipping/refining/sale of products, corporate
overhead costs, etc.
Ensure that other costs such as title and licenses, taxes and royalties, tariffs, permitting, legal, etc are identified
as being included or excluded. Identify how these costs will be distributed back to the project and the ongoing
operation.
Clearly identify the level of confidence in the information that forms the basis of the study (mineral resource
estimate, geotechnical/hydrogeology, metallurgy, etc.).
The level of accuracy of the basic information available (mineral resource tonnes and grade) sets the level of
effort that should go into the venture analysis study. There is no point in trying to define production rates and
costs to some specific level of accuracy if the resource information is not well defined.
Significant assumptions made in arriving at the scope of work, a mine plan, capital/operating costs, and a
project schedule must be clearly identified in the report.
See also
The stages of mine design
Scoping study
Pre-feasibility study
Feasibility studya
https://minewiki.engineering.queensu.ca/mediawiki/index.php/Pre-evaluation_study 3/3