Segilola gold mine valuation using Monte Carlo simulation approach
Tóm tắt
The Segilola gold mine has been valued in this work to determine its viability using Monte Carlo simulation approach. To achieve this, a base case discounted cash flow (DCF) model was developed for the project from which sensitivity analysis was conducted to determine the value drivers in the project. Using Palisade's @Risk 6.0 software and setting suitable probability distribution function for the value drivers of the project, Monte Carlo simulation was used to calculate the statistical forecast of the project value. The base case DCF analysis gave a negative net present value (NPV) of US$−7.46 million. The sensitivity analysis showed that the input parameters: gold price, gold grade, strip ratio, and operating costs are the value drivers of the project. A mean NPV of US$30.79 million was obtained for the project with a standard deviation of US$58.26 million after running the Monte Carlo simulation. The simulation result also showed that the probability of achieving positive NPV (profit) in the project is 69.2 % and probability of loss of money is 30.8 %.
Tài liệu tham khảo
Baran B (2008) Valuing option to defer and to abandon on a tar sand project in Canada. Unpublished MSc thesis, Imperial College London
Camm TW (1991) Simplified cost models for prefeasibility mineral evaluations. US Bur Min Inf Circ 9298:35
Central Bank of Nigeria (2011) CBN securities data. http://www.cenbank.org/rates/GovtSecurities.asp. Accessed 12 July 2012
Fernandez P, Aguirreamalloa J, Corres L (2011) Market risk premium used in 56 countries in 2011: a survey with 6,014 answers, IESE Business School WP. http://www.iese.edu/research/pdfs/DI-0920-E.pdf. Accessed 13 July 2012
Frimpong S (1992) Evaluation of mineral ventures using modern financial methods. Unpublished Doctoral Dissertation, University of Alberta
Hartman H (1992) SME mining engineering handbook. Society of Mining Engineering, pp 127
HGR (2012) High River Gold Mines Ltd. http://www.hrg.ca/i/pdf/Presentation.pdf
Mallinson M, French N (2000) Uncertainty in property valuation. J Prop Invest Financ 18(1):25–38
Pachamanova DA, Fabozzi FJ (2010) Simulation and optimization in finance—modeling with MATLAB, @RISK, or VBA. Wiley, New Jersey, p 112
PR Newswire (2012) http://www.prnewswire.com/news-releases/romarco-announces-positive-feasibility-study-for-haile-gold-mine-project-115667639.html. Accessed 24 Jan 2013
Ratel Gold Limited (2010) A prospectus for an offer to eligible CGA shareholders of 4,383,208 common shares in the Capital of Ratel Gold Limited at an issue price of Cdn$0.20 per common share to raise up to Cdn$876,641 before the costs of this offer. http://www.cgamining.com/FCKuploads/file/Ratel-Gold-Australian-prospectus-final-proof.pdf. 20 June 2012
Said R and Daud N (2005) Utilising Monte Carlo simulation for the valuation of mining concessions. J Des Built Environ, University of Malaya, Vol. 1 (1(Non-ISI/Non-SCOPUS Cited Publication)
Singer DA, Menzie WD, Long KR (1998) A simplified economic filter for open-pit gold-silver mining in the United States. U S Geol Surv Open-file Rep 01–218:21