Comments on: Exploding costs: An analysis of Galore Creek /exploding-costs-an-analysis-of-galore-creek/ No 1 source of global mining news and opinion Tue, 14 Apr 2020 16:06:35 +0000 hourly 1 https://wordpress.org/?v=6.8.1 By: Scott Dunbar /exploding-costs-an-analysis-of-galore-creek/#comment-48741 Tue, 14 Apr 2020 16:06:35 +0000 /?p=1019678#comment-48741 It is worth noting that on page 228 of the 2006 feasibility study all of the potential construction sequencing problems were identified and it was suggested that each of these problems could delay construction by a year or more and add to costs. Also identified was the potential for construction labor cost increases due to the competing demand for labor from oil sands and construction for the 2010 Winter Olympics. Each of these identified issues happened and led to the construction halt in 2007. On pages 1-2 of the 2008 report which reclassified the reserves explained the reasons for the capital cost increases which were almost verbatim repeats of what was stated about potential issues on page 228 of the 2006 report.

Nobody reads page 228 of a 355 page report. Numbers are easier to digest. It is relatively easy to cost the effects of these issues and, in general, investors would be better served if that were done in feasibility studies. However, I was told that if that kind of thing were done, three things could happen: 1) the share value of the owner would drop, 2) the engineering company could be sued for damage, and 3) the engineering company would likely not obtain any further work in feasibility studies. This situation does not help the investor understand the risks.

]]> By: peter /exploding-costs-an-analysis-of-galore-creek/#comment-48683 Mon, 13 Apr 2020 15:57:53 +0000 /?p=1019678#comment-48683 a small point, but the picture in the article is of mt. shuksan near mt baker in washington state…

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