Financial viability underlies every metallurgical decision. Anything orebody that is not worth developing or continuing to mine will not be worked on. Many variables come into play:
- Metal prices
- Each mine operates at a given cost per ounce gold or equivalent produced. If the value of the metal drops below this cost, the mine will lose money on each tonne or ounce of product they sell, making it unsustainable long term.
- Mining and Milling cost
- Once you have an orebody and the infrastructure required to mine it and mill it, you still incur ongoing expenses known as OPEX. These range from diesel fuel for equipment, to chemical reagents, to energy, to drilling and blasting and rehabing, to grinding and maintenance and work salaries.
- Orebody size
- If there is not sufficient ore (link to glossary) currently known/available, even if it would otherwise be profitable, the capital cost (CAPEX) to develop the orebody may preclude this.
Break above into CAPEX/investment and then OPEX related costs and considerations.