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This is an excellent article from the ASX
...to read the balance...
http://www.asx.com.au/resources/new...e/20060214_reading_mining_company_reports.htm
How to read mining company reports
- Thread starter Ann
- Start date
This is an excellent article from the ASX
...to read the balance...
http://www.asx.com.au/resources/new...e/20060214_reading_mining_company_reports.htm
Caliente
Black Gold!
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hi ann, I just had a read of that report. It provides a good basic overview of the different cross sections, but is there more detail on understanding the more technical aspects of a mining report, such as the % purity of the ore, what kg/t oz/t readings are good, electromagnetic/thermal surveys etc.
Thats the kind of information that would be priceless in deciphering a report.
Many thanks.
Thats the kind of information that would be priceless in deciphering a report.
Many thanks.
For more intermediate or advanced reading perhaps this will help.
http://www.moneybags.com.au/default.asp?d=0&t=1&id=2716&c=0&a=74
The topics covered in The Mining Valuation Handbook that will be of most interest to the budding resources analyst include the following:
*the process involved in getting a mining project off the ground (eg. pre-feasablility and bankable feasability studies);
*detail on how each major commodity is mined and processed;
*the pros and cons of the various drilling/mining techniques;
*the classification of reserves and resources;
*various project valuation methodologies, including the definition of terms commonly used in research reports such as NPV and IRR;
*sensitivity analysis;
*how cut-off grade theory is applied; and,
*the life cycle of a resources company and how you may expect the share price to respond during the various stages.
Readers review ( not my review.. I have not read it)
All of the above topics are covered with a good degree of technical detail. However when the author ventures into the area of NPV/IRR calculations and the mathematcis involved, I felt that parts of the material were presented in a fashion that will most likely confuse many readers. Those that have previous experience with discounted cashflow techniques will fare a bit better than most and a misprint at a critical point in one example doesn't help either!
It is not entertaining reading, there're no jokes or lighthearted moments - just 250 pages or so of hard facts and figures on the Autralian resources industry. This makes for some very hard reading, something akin to working through a medium-sized university textbook from cover to cover. In fact I can't see anyone except the most dedicated resources buff even attemping to read it from cover to cover without skipping the odd page or chapter!
Table of contents
1. Introduction
2. Australian Resources Industry
3. A Quick Guide to Financials
4. Feasibility Studies
5. Relative Commodity Values
6. Resource Project Considerations
7. Classification of Resources and Reserves
8. Mining and Hydrocarbon Recovery
9. Indicative Capital and Operating Costs
10. Hedging Commodities and Exchange Rates
11. Taxation, Depreciation and Exploration Standards
12. Valuation and Pricing Techniques
13. Quantifying Risks
14. Cut-Off Grade Theory and Practice
15. Commodity Price Forecasting
16. Share Price Performance
17. Impact of Exploration Results
18. Determining The Appropriate Discount Rate
19. Dealing With Inflation
20. Government Royalties
21. Agricola Mining - Case Study
22. Commodity Profiles
23. Sources of Public Information
24. Abbreviations, Conversions and Energy Factors
25. Bibliography and References
26. Glossary of Terms
http://www.moneybags.com.au/default.asp?d=0&t=1&id=2716&c=0&a=74
The topics covered in The Mining Valuation Handbook that will be of most interest to the budding resources analyst include the following:
*the process involved in getting a mining project off the ground (eg. pre-feasablility and bankable feasability studies);
*detail on how each major commodity is mined and processed;
*the pros and cons of the various drilling/mining techniques;
*the classification of reserves and resources;
*various project valuation methodologies, including the definition of terms commonly used in research reports such as NPV and IRR;
*sensitivity analysis;
*how cut-off grade theory is applied; and,
*the life cycle of a resources company and how you may expect the share price to respond during the various stages.
Readers review ( not my review.. I have not read it)
All of the above topics are covered with a good degree of technical detail. However when the author ventures into the area of NPV/IRR calculations and the mathematcis involved, I felt that parts of the material were presented in a fashion that will most likely confuse many readers. Those that have previous experience with discounted cashflow techniques will fare a bit better than most and a misprint at a critical point in one example doesn't help either!
It is not entertaining reading, there're no jokes or lighthearted moments - just 250 pages or so of hard facts and figures on the Autralian resources industry. This makes for some very hard reading, something akin to working through a medium-sized university textbook from cover to cover. In fact I can't see anyone except the most dedicated resources buff even attemping to read it from cover to cover without skipping the odd page or chapter!
Table of contents
1. Introduction
2. Australian Resources Industry
3. A Quick Guide to Financials
4. Feasibility Studies
5. Relative Commodity Values
6. Resource Project Considerations
7. Classification of Resources and Reserves
8. Mining and Hydrocarbon Recovery
9. Indicative Capital and Operating Costs
10. Hedging Commodities and Exchange Rates
11. Taxation, Depreciation and Exploration Standards
12. Valuation and Pricing Techniques
13. Quantifying Risks
14. Cut-Off Grade Theory and Practice
15. Commodity Price Forecasting
16. Share Price Performance
17. Impact of Exploration Results
18. Determining The Appropriate Discount Rate
19. Dealing With Inflation
20. Government Royalties
21. Agricola Mining - Case Study
22. Commodity Profiles
23. Sources of Public Information
24. Abbreviations, Conversions and Energy Factors
25. Bibliography and References
26. Glossary of Terms
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I am not aware of any one location that you will find everything you want.two40 said:
I still have to hunt down stuff that seems it should be readily available.
But the crux of it is about the extent that financials match up with production, based on the geology.
And then all that needs to be married to the prevailing and forward prices of the minerals mined.
Examples:
Newcrest's Telfer copper/gold project ran into big problems due to the high arsenic content of its orebody.
AEX's recent drilling report failed to excite the market. Not because they didn't find gold or uranium, but because they didn't find it the quantity anticipated. Moreover, even if they had a better result, few investors would have a clue what it was going to cost to extract it because the company is not at a stage where they can determine mining methods or a mine plan. For example, would open cut be better than going underground, and what cut-off grade would they work to?
This latter example is an up to date demonstration of the problems the best of have with coming to grips with mining companies.
Good luck!
Caliente
Black Gold!
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Thanks all very much for your contribution in this thread. I'll be reading the above information on moneybags.com.au very closely.
Cheers
-Caliente/.
Cheers
-Caliente/.
