Valuation of mineral properties which do not contain exploitable reserves

CIM Bulletin, Vol. 83, No. 940, 1990

Lionel C. Kilburn

This geological engineering method is based on four main characteristics of mineral properties, viz; location: inclusion of valuable mineralization; inclusion of geophysical and/or geo-chemical targets; and inclusion of geological targets. These are subdivided into a total of '19 subcategories, which are used to determine the value of the property. The nineteen subcategories are prioritized and assigned relative value factors from 1.3 to 10. Value of each mineral claim-unit is determined by applying the appropriate subcategory factors to a base vaue of $400 per 16.2 hectare unit. Property value is calculated by totalling the values of such individual claim-units. The boundary between ore grade and sub-ore grade must be estimated for each property under valuation, thereby making the method sensitive to mineral commodity prices. A clear and disciplined sequence of decisions based on personal experience forms the basis of this method. The method utilizes all factors normally used to value a mineral property.

Mots Clés: Property valuation, Exploration, Economics.