Reconciling AISC to Mineral Project Valuations

Denver, 21 January 2016  |  Vancouver, 26 January 2016

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Reconciling AISC to Mineral Project Valuations

Since establishing formal guidelines in 2013, the World Gold Council’s (WGC) All-In Sustaining Cost (AISC) has been an important metric for comparing costs per payable metal unit sold for gold mining companies. However, it should not be a surprise that there are many interpretations of AISC, even with explicit WGC guidelines. While AISC is used by the investment community in ranking current producers, it is also often quoted by companies in valuations for mineral projects not yet in production. However, such technical-economic valuations using accepted best practices (as seen in NI 43-101 technical reports) are invariably in conflict with several aspects of the AISC guidelines. This presentation attempts to highlight the discrepancies between AISC guidelines and standard technical-economic valuations. To this end, for mineral project valuations not yet in production, SRK advocates a “Total Cash Cost” concept which reports costs per payable metal unit sold during life of mine commercial operations.


Grant Malensek for Denver Gold GroupGrant Malensek was born and raised in Vancouver, British Columbia where he graduated from the University of British Columbia in 1987 with a degree in Geological Sciences. Before and after receiving his masters from Colorado School of Mines in Geological Engineering (with minor in Economics) in 1997, he worked for a number of companies as a project geologist in Canada, Papua New Guinea, Indonesia, USA and South America. SRK ConsultingIn 2008, after spending a few years in the telecom industry working in finance, he joined Newmont Mining’s Project Business Analysis team before moving on to SRK Consulting (U.S.) in 2012 as a Principal Consultant – Mineral Project Evaluation. He lives in Denver, Colorado with his wife Anita and their four children; Emma, Ryan, Aidan, and Erin.