UndervaluedEquity.com
Page: Mining Costs - CAPEX vs. OPEX

My Due Diligence
   Understanding the Stock Market
   Dow to Gold Ratio
   S&P 500 PE Ratio
   January Effect
   My Stock Market Analysis
   How to Invest in Shares
   Analysts's Stock Ratings
   Country Risk Assessment
   Management Assessment
   Key Management Positions
   Management Compensation
   Management Evaluation
   Insider Stock Trading
   Insider Stock Ownership
   Company Ownership Search
   Insider Trading Rules
   Insider Trading Canada
   Insider Trading USA
   Personal Stock Holdings
   Monitor Your Portfolio
   Share Structure
   Employee Stock Options
   Flow-Through Shares
   Short Stock Positions
   Stock Warrants
   Oil and Gas Companies Analysis
   Oil and Gas Exploration Companies
   Investing in Oil and Gas Companies
   Oil and Gas Flow Rates
   Fracking Definition
   Resources and Reserves Definitions
   Mining Companies Analysis
   Mining Industry Standards
   CIM Definition Standards
   Mineral Resource Stocks
   Gold Mining Shares
   Mineral Exploration Companies
   Drilling Rigs
   Drilling Program
   Drilling Results
   Metal Equivalent Calculation
   Metal Recovery Rate
   Mining Costs
   Break Even Analysis
   Metal Value per Tonne
   Mineral Deposit Value
   Mine Life Cycle
   How Do I Invest in Stocks
   How Do I Buy Stocks
   Insider Ownership Analysis
   Country Risk Ranking System
   Stock Investment Analysis
   Institutional Ownership Assessment
   Management Compensation Analysis
   Management Compensation Comparison
   Management Compensation Evaluation
   Shorting a Stock
   Stock Options and Warrants
Support Me
Free Charts
   Base Metals Price Charts
   Energy Price Charts
   Fertilizer Price Charts
   Precious Metals Price Charts
   Stock Market Indices
ETF Finder
   Base Metals ETFs
   Copper ETFs
   Lead ETFs
   Nickel ETFs
   Tin ETFs
   Energy ETFs
   Coal ETFs
   Crude Oil ETFs
   Natural Gas ETFs
   Uranium ETFs
   Fertilizer ETFs
   Potash ETFs
   Minor Metals ETFs
   Rare Earth Metals ETFs
   Precious Metals ETFs
   Gold ETFs
   Palladium ETFs
   Platinum ETFs
   Silver ETFs

Mining Costs - CAPEX vs. OPEX

images/Mining-Costs_10283641866_8a8495d489_o_780x390px_85pct.jpg

Depending on the location of the project and the type and quantity of the minerals contained within the deposit, the mining costs can vary a lot between different mining projects.

In general, underground mining is more expensive than open pit mining as with open pit mining the minerals are found near the surface at a maximum of approximately 200-400 meters depth in bulk tonnage.

The mining costs are estimated in a mining company's feasibility study which, when available, can be found on the company's website (often hidden between the news releases).

In the feasibility study you should look for the expected CAPital EXpenses (CAPEX) and OPerational EXpenses (OPEX) to inform yourself about the mining costs of the specific project.

Capital Expenditures (CAPEX)

Capital expenditures are the investments incurred by a mining company in their fixed assets to increase the value of that asset. Most common capital expenditures are the investments in fixed assets to bring a new mineral project into production. However, buying a property or the investments incurred to expand the current production level of an existing mineral project are also referred to as CAPEX.

When the CAPEX is known you can verify if this amount is freely available on the company's (most recent) balance sheet. If the CAPEX is available on the balance sheet, of if you can find an announcement between the company's news releases in which the company explained to have accepted a financing offer, you know that the project will be developed. If the CAPEX is not available then you must be really careful with this specific mining stock as this will often result in downward pressure on the company's share price, until the project financing is arranged.

Operational Expenditures (OPEX)

The operational expenditures are those recurring costs for operating the mine. In short, OPEX are those direct and indirect costs to mine, process and sell the ore.

 

If you would like to be the first to be informed when I add new content to UndervaluedEquity.com, please leave your details in the name grab form on the Support page!

You can also support me directly by clicking on the advertisements that appeal to you, or by making a voluntarily donation with Paypal.

Your support helps me to speed up the process of adding great, free content to UndervaluedEquity.com!

 

What Type of Content Can You Expect to Find on UndervaluedEquity.com

Main Section  Description 
News (RSS)  Today's News Related to the Global Energy and Mining Stocks. On this page a RSS feed is displayed with stock market news related to the energy and mining sectors. You can subscribe to this free RSS feed too! 
My Due Diligence  How I Conduct My Stock's Due Diligence Investigation Process. If you want to know what I learned while I was conducting my due diligence, I recommend you to read all the chapters of the investigation process. 
My Stock Watchlist  Are These the Best Stocks to Buy Today. In my stock watchlist you find stocks who offer great potential, but at the time I analysed these stocks they didn't comply with all my guidelines from my due diligence chapters. 
My Stock Portfolio 

Are These the Best Shares to Buy Now. As the year 2015 has just started, I believe it's about time that I share my stock portfolio with you. Therefore, you will find my updated stock portfolio on this page.

 

 

comments powered by Disqus

Support Me
Contact
Books
Free Charts
ETF Finder
Legal Terms
Sources