Production

Modelling in both GHG & energy and water:

Skarn Associates approaches the modelling of mineral extraction sites and processing facilities similarly to how a discount cash flow model (DCF) would be constructed. In a DCF model, the first stage would be to research and understand an operation and its flowsheet, and assemble the information required to model a life-of-mine (LOM) plan for production at the asset, from which the revenue can be derived.

The starting point of our asset-by-asset analysis involves building up an understanding of the production profile of a mine and the type of mining, processing and likely longevity of the operation. Central to this is our teams’ knowledge and skill set which includes geologists, geotechnical, mining and chemical engineers, many with direct hands-on experience working on mine sites or smelters. Each asset in our dataset is individually modelled from the bottom up on a calendar-year basis, beginning with individual site production metrics

The second stage of producing the DCF model would be to then look at the capital and operating costs of the asset, and to model them out year-by-year. Instead of producing the costs side of such a DCF model, Skarn marries the LOM plan with a year-by-year analysis of energy inputs and other relevant data to put together an assessment of the GHG emissions per year for a property. For the majority of it’s work analysing mine site emissions, Skarn utilises economic allocation of emissions between the produced commodities at each mine site. In this way, very different mines with different revenue drivers and process routes can be compared on a similar basis to one another. Skarn’s data is used to interrogate industry supply chains and compare performance. Every company and every asset is unique, either in terms of process method, product mix, infrastructure, location and geology. Our standard processes enable comparison between entities reporting different statistics to different degrees of granularity.