The mining industry regularly experiences highs and lows. The returns can be substantial, but the risks are high. As an investor, you could make money if the company operates its mine or if it is acquired by another company. Depending on economic conditions and how the project progresses, you could also lose some or all of your investment.
The research and activities to be carried out between discovering a deposit and starting up mining operations involve a lot of time and money. Even if the initial samples (the mineral occurrences) seem promising, a mining company has to conduct extensive assessment work to determine whether mining operations will be profitable.
Of the new deposits that are discovered, very few are actually mined. In many cases, the assessments show that mining would not be profitable. In cases where profitability is demonstrated, more than 10 years can pass between the initial discovery and the start of mining operations.
Golden Maprix Company as a consulting firm provides the necessary information about;
- What are the stages involved in carrying the project to a successful conclusion?
- How much time and money will it take to complete these stages? How will these costs be funded?
- Do the promoters have experience and expertise in the mining industry? Have they previously carried out a mining development project successfully?
- Are the estimates (quality of the mineral reserves or resources, production volume, costs, timeframes) presented in detail in a technical report prepared by an independent, qualified person?
- What terms and conditions must be met in order for the company to keep its rights in the project? Are they difficult to meet?
- What risks might impede the execution of the project?
- Have other mining companies attempted to develop this deposit in the past, and abandoned it? Why did they abandon it? What will be different this time?
- How much money has been raised for, and spent on, this project?
- Is the project located in a politically stable country?