Water balance uncertainties have long been known to lead to potential environmental hazards, but their effect on economic profitability of mines is an under-studied field of research. Historical rainfall data are analyzed using the extreme value theory (EVT) and the peak over threshold method (POT). The resulting distributions are used as inputs into a system dynamics techno-economic metal mining investment profitability model, and simulation analysis is performed. The proposed methodology incorporates rainfall extremes and uncertainty into techno-economic modeling of metal mining operations. A case study with real-life historical rainfall data was used to illustrate the relationship between hydrologic uncertainty and the economic value of a metal mining investment.
Incorporating Hydrologic Uncertainty in Industrial Economic Models : Implications of Extreme Rainfall Variability on Metal Mining Investments / J. Savolainen, D. Pedretti, M. Collan. - In: MINE WATER AND THE ENVIRONMENT. - ISSN 1025-9112. - 38:2(2019), pp. 447-462. [10.1007/s10230-019-00600-w]
Incorporating Hydrologic Uncertainty in Industrial Economic Models : Implications of Extreme Rainfall Variability on Metal Mining Investments
D. Pedretti;
2019
Abstract
Water balance uncertainties have long been known to lead to potential environmental hazards, but their effect on economic profitability of mines is an under-studied field of research. Historical rainfall data are analyzed using the extreme value theory (EVT) and the peak over threshold method (POT). The resulting distributions are used as inputs into a system dynamics techno-economic metal mining investment profitability model, and simulation analysis is performed. The proposed methodology incorporates rainfall extremes and uncertainty into techno-economic modeling of metal mining operations. A case study with real-life historical rainfall data was used to illustrate the relationship between hydrologic uncertainty and the economic value of a metal mining investment.File | Dimensione | Formato | |
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