Author Description

This report appraises base and precious metal exploration in Chile under a set of base case conditions as profitable, in and of itself, and competitive with respect to Australia and Canada. The appraisals are based on estimates of the exploration expenditures, development costs, and production revenues and costs associated with an economic deposit, and a methodology that evaluates historical experience in the context of present-day economic and technological conditions. Sensitivities of the base case to variations in metal prices and minimum acceptable exploration target conditions and to the multi-billion-dollar discovery have been considered, as has the impact of taxation. The study database was complied through the co-operation of a large number of domestic and international private mining companies and government agencies, and covers the 1970-92 period. For the purposes of time-trend analysis, the database is subdivided into the periods 1970-78, 1979-87, and 1988-92. The results provide a detailed picture of exploration economics in Chile as well as more general empirical evidence of the fundamental ingredients of successful mineral exploration.