Please folks, pay no attention to the delusional ravings of Danube. They are totally nonsensical, misleading, and insulting to the quality and integrity of BMN directors.
Bare in mind that with feasibility studies they fall into a number of categories, each category acts as a further level of confidence in the project:
1]Pre-feasibility studies (PFS) 2]Feasibility study (FS) 3]Definitive feaibility study (DFS) 4]Bankable feasibility study (BFS)
Each of these levels adds some NEW study to the project, but many of the studies overlap each other, and only need to be done once. With BMN, their Scoping Study is in fact a synonym for the PFS, but with MUCH MORE included. In fact even much of the FS requirements are covered. After the SS was released last year, Coffey have kept working on the studies, and have been doing so till now, so essentially we can say that Anomaly A feasibility studies actually started in MAY last year with the announcement on May 8: "Bannerman To Expedite Studies for Goanikontes"
As I said, these "studies" have continued & will lead into the DFS any day now, leading into the BFS to be completed by end of 2008 ... all up taking about 18 months from go to wo. Some companies define & commission these separately, some just term them simply as "Feasibility Studies" or in the case of BMN "Bankable Feasibility Studies"
Below I have added some info on the various Feasibiity Study levels, and what each entails.
In mine project development, Feasibility Studies come under what is termed “Conceptual Engineering Studies” - Their objective is to evaluate the technical, environmental, and economic feasibility of any proposed project. They work on a similar basis to the JORC system which “grades” the level of a mineral deposit. Conceptual engineering studies include the following levels:
1] Preliminary Feasibility Study Objective: To formally present an analysis of the predicted technical, economic and financial viability of a project. Estimates costs to a precision of PLUS OR MINUS THIRTY PER CENT.
2] Feasibility Study If the PFS provides an optimistic scenario, then more accurate design criteria are established to update the report to a feasibility study. Cost estimates developed to an accuracy range of FIFTEEN TO TWENTY FIVE PERCENT.
3] Definitive Study When the Feasibility Study passes the project investment criteria, a Definitive Project Study is produced. Predicts capital and operating costs to an accuracy range of TEN TO FIFTEEN PER CENT.
3] Bankable Document (BFS) The final step is the preparation of a Bankable Document which requires the actual facilities and equipment accurately specified, some detailed design completed and cost estimates established from competitive vendor quotations. The document will normally provide a comprehensive analysis of the project based the Feasibility Studies that have preceded it, and will provide greater definition or expansion. The project costs established for the Bankable Document are used for Project Management Budget Control, more detailed technical and financial analysis, and for submission by the client to financial institutions. They have an accuracy of PLUS OR MINUS TEN PERCENT.
FURTHER INFORMATION: Feasibility Study The Feasibility Study document will require the provision of those services necessary to investigate the technical, economic and financial viability of the project to a Type 2 estimate designation.
The scope of the feasibility study document would include: • Development of the mine over its proposed life in qualitative and quantitative terms • Investigation of the required process covering conception, configuration and sizing • Investigation of the required infrastructure and support facilities • Investigation into the anticipated interaction with government and environmental protection agencies • Review and evaluation of data provided by the client • Procurement of documentation from third parties, eg. relevant government publications and maps • Preparation of statements on technical aspects of the following project areas for formal review by the client: 1. Mine process plant 2. Infrastructure 3. Support facilities 4. Logistics 5. Environmental impact The Feasibility Study document will include the following information: • Evaluation and review of available geological and hydrological reports • Recommendation as to mine development including phasing of development, envisaged ROM grade, capital equipment and manning levels required • Recommendations for the process plant in the following format: Flow diagram Material and water balances Equipment list (major items) together with budget quotations General arrangement plan and elections of process plant to scale 1:100 • Infrastructure requirements including ancillary buildings, roads, drainage, tailings disposal • General arrangement drawings of infrastructure layout • Support facilities, eg. supply of water in various qualities, electricity, accommodation requirements • Electrical system (single line diagram) • Logistics of supply materials, equipment and manpower to site which includes an investigation of transport modes • Identification of strategic decisions required, eg. early ordering of long delivery items, early starts to opening of negotiations for right-of-way dispensation etc. • Estimate of capital and operating costs including a preliminary discounted cash flow analysis (if requested by the client - all costs to include transport and commissioning costs, fees and all management costs except for client's own costs) • Preliminary programme for carrying-out the project Definitive Study
The scope of work for the Definitive Study would be dependent on the recommendations of the Feasibility Study and the client's instructions with respect to those recommendations.
The work plan to produce a Definitive Study Report would be as follows: • Formally receive from the client, comments on the Feasibility Study Report together with directives relative to the manner and preparation of the Definitive Study Report • Receive from the client requirements for the presentation of financial data • Review and evaluate all existing data and concepts contained in the Feasibility Study and obtain client approval for any additional data or concept changes that should be incorporated into the new project plan • Optimise the basic concepts contained in the Feasibility Study, particularly with regard to production level, manpower requirements, equipment selection and sizing, plant layout, facilities and infrastructure • Finalise the process flow sheets material balances and control philosophy • Review laboratory facilities • Evaluate and review mine, process plant and services operations The study would extend the conceptual plan developed during the Feasibility Study to the levels detailed above and would include as a minimum: • Design criteria • Equipment lists • Process description • General arrangements and outline drawings • Capital and operating cost estimates • Project schedule • Specifications • Recommendation for implementation
Bankable Document The Bankable Document provides a detailed technical and financial analysis of all aspects of the project for submission by the client to financial institutions. It will provide the control budget for both construction and long term management of the project. The document will normally provide a comprehensive analysis of the project based on the broad categories or combination of categories indicated below and would include those portions of the Definitive Study which were directly relevant or which required greater definition or expansion, generally as indicated over:
Geomorphology / Hydrology • Describe site-location climatic conditions, land forms hydrology • Prepare water management plan in particular consider site release of waters, run-off, extraction permits, plant usage
Environmental • Define environmental constraints • Provide environmental impact assessments and reports • Describe environmental safe guards
Geology • Provide geological study and delineate extent of ore bodies • Define extent and type of ore reserves
Mining • Provide detailed mining plan including production rates, grade control, equipment, budgets and schedules
Process • Describe process, include design, criteria, flowsheets, material balances, process instrumentation and controls, equipment lists and facilities • Provide general arrangement drawings, architectural and structural elections, mechanical layouts, piping and electrical outlines
Infrastructure • Determine communications, power and water requirements and intended method of supplying the project • Review accommodation requirements and proposals • Investigate all transportation requirements including staff transportation during operations • Define need for rail lines, airstrips, permanent and temporary access roads etc • Provide tailings treatment philosophy including requirements for dams, liners, overflows reclamation and pipe lines • Advise on warehousing, maintenance facilities, administration, first aid, security, laboratory facilities and staff amenities
Construction • Report on contractual arrangements for the construction process and provide control documentation • Provide analysis of construction process, ie. construction packages, procurement, construction schedules, site procedures, QA/QC and contracts management • Identify long lead and critical path items and provide expediting schedules • Provide anticipated manning levels • Define safety and industrial relations policies and dispute handling procedures • Supply basic specification and contractual documentation
Operations • Prepare operations philosophy • Provide manning levels for all areas including administrative, mining, maintenance and laboratories • Indicate requirements for personnel training • Identify all permits required from statutory authorities
Financial • Prepare capital cost and operating budgets for the overall project to a + 10 % accuracy • Provide economic evaluations, anticipated cash flows and sales forecasts • Identify risk areas and levels of confidence
BMN Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
(20min delay)