IMPACT OF OPERATIONAL COST ESTIMATION AND COMMODITY PRICE FORECAST ON FEASIBILITY STUDY CASH FLOW MODEL: AN IRON ORE CASE STUDY

摘要

Reliability of the mineral projects' feasibility studies are basis for investment decision making processes. However, there is generally a potential to deviate from feasibility study cash flow model input parameters. Some of the most important factors that determine precision of the discounted cash flow evaluations are the accuracy of the production parameters, operational expenditure estimates and commodity price forecasts at which the product is to be sold. Alternate cash flow model scenarios and sensitivity analyses are common tools to define project risks clearer and evaluate mineral projects. This paper presents the impact of price and cost input parameter deviations on an iron ore project cash flow model.