Mining Company Valuations

  • The valuation of a mine can move rapidly based on some key drivers 
    • How much ore is left to mine (mine life)
    • % of valuable ore per ton
    • Cost to mine a ton of ore
    • Market price of the metal being mined

  • The cost of energy has a huge impact on the mining industry
    • One of the largest mining costs is energy - to move rock, crush it, drill, etc.
    • For some ores the cost of energy can be 50% of the cost!
  • The mining industry has become less labor intensive over time as technology has improved