Feasibility study of Gol-Gohar iron ore open cast mine operation of Iran

Abstract

Feasibility study of the mining operation is one of the most important parts of the total mineral exploitation process. The economic importance of this, increases with the size of the mineral reserves. Gol-Gohar is one of the largest iron ore mines in Iran with an annual output of some 11 million tons. In this paper, the total costs associated with Gol-Gohar open cast mine have been calculated. These have been divided into capital cost, labor cost, energy and materials and supplies costs. Total revenues have also been estimated based on reliable forecasts for future. The results have then been analyzed and in particular, the effects of the inflation of prices on costs and other variables have been fully demonstrated. The paper calculates that the results obtained from feasibility studies of mining operations, can be affected seriously when uncertainties are present in the economy and when there are instabilities in the general price levels. It has also been concluded that fluctuations in the exchange rates can have a dramatic impact on the success of such long term activities.