Financial evaluation of Sungun Copper Project using DCF method

Citation

Oraee K, Rashidinejad F & Asi B (2007) Financial evaluation of Sungun Copper Project using DCF method. In: Singhal R, Fytas K, Jongsiri S & Ge H (eds.) 16th International Symposium on Mine Planning and Equipment Selection 2007. Sixteenth international symposium on mine planning and equipment selection (MPES 2007), Bangkok, Thailand, 11.12.2007-13.12.2011. Irvine, California: Reading Matrix, pp. 713-720. http://www.mpes-cami-swemp.com/

Abstract
The Sungun copper mine that operated by National Iranian Copper Industries Company (NICICO) is a world class project of great magnitude and complexity. A detail financial model of the Sungun Copper Project was constructed. The Internal Rate of Return (IRR) of the base case is 18%. At a discount rate of 6.5% the Net Present Value (NPV) of the Project is $1,554M at a copper price of $4,500/t. The breakeven copper price at the 6.5% discount rate is $2,460/t. The most sensitive factors, as is usual in projects of this nature are copper price and discount rate. Because of the contractual mining system, OPEX is slightly more influential than CAPEX.

Keywords
DCF analysis; CAPEX; OPEX; IRR; NPV; Breakeven copper price; Copper industry and trade Iran; Copper industry and trade East Azarbaijan (Iran); Copper prices East Azarbaijan (Iran); Copper prices Iran