Strategic project evaluation for open pit mining ventures using real options and allied econometric techniques

Open pit mine operations are complex businesses that demand a constant assessment of risk. This is because the value of a mine project is typically influenced by many underlying economic and physical uncertainties, such as metal prices, metal grades, costs, schedules, quantities, and environmental issues, among others, which are not known with much certainty at the beginning of the project. Hence, mining projects present a considerable challenge to those involved in associated investment decisions, such as the owners of the mine and other stakeholders. In general terms, when an option exists to acquire a new or operating mining project, , the owners and stock holders of the mine project need to know the value of the mining project, which is the fundamental criterion for making final decisions about going ahead with the venture capital. However, obtaining the mine project’s value is not an easy task. The reason for this is that sophisticated valuation and mine optimisation techniques, which combine advanced theories in geostatistics, statistics, engineering, economics and finance, among others, need to be used by the mine analyst or mine planner in order to assess and quantify the existing uncertainty and, consequently, the risk involved in the project investment. Furthermore, current valuation and mine optimisation techniques do not complement each other. That is valuation techniques based on real options (RO) analysis assume an expected (constant) metal grade and ore tonnage during a specified period, while mine optimisation (MO) techniques assume expected (constant) metal prices and mining costs. These assumptions are not totally correct since both sources of uncertainty—that of the orebody (metal grade and reserves of mineral), and that about the future behaviour of metal prices and mining costs—are the ones that have great impact on the value of any mining project. Consequently, the key objective of this thesis is twofold. The first objective consists of analysing and understanding the main sources of uncertainty in an open pit mining project, such as the orebody (in situ metal grade), mining costs and metal price uncertainties, and their effect on the final project value. The second objective consists of breaking down the wall of isolation between economic valuation and mine optimisation techniques in order to generate a novel open pit mine evaluation framework called the ―Integrated Valuation / Optimisation Framework (IVOF)‖. One important characteristic of this new framework is that it incorporates the RO and MO valuation techniques into a single integrated process that quantifies and describes uncertainty and risk in a mine project evaluation process, giving a more realistic estimate of the project’s value. To achieve this, novel and advanced engineering and econometric methods are used to integrate financial and geological uncertainty into dynamic risk forecasting measures. The proposed mine valuation/optimisation technique is then applied to a real gold disseminated open pit mine deposit to estimate its value in the face of orebody, mining costs and metal price uncertainties.

Thermal profile of a near-adiabatic compression process in a cylindrical tube and establishment of critical control elements for repeatable process control

The compressed gas industry and government agencies worldwide utilize "adiabatic compression" testing for qualifying high-pressure valves, regulators, and other related flow control equipment for gaseous oxygen service. This test methodology is known by various terms including adiabatic compression testing, gaseous fluid impact testing, pneumatic impact testing, and BAM testing as the most common terms. The test methodology will be described in greater detail throughout this document but in summary it consists of pressurizing a test article (valve, regulator, etc.) with gaseous oxygen within 15 to 20 milliseconds (ms). Because the driven gas1 and the driving gas2 are rapidly compressed to the final test pressure at the inlet of the test article, they are rapidly heated by the sudden increase in pressure to sufficient temperatures (thermal energies) to sometimes result in ignition of the nonmetallic materials (seals and seats) used within the test article. In general, the more rapid the compression process the more "adiabatic" the pressure surge is presumed to be and the more like an isentropic process the pressure surge has been argued to simulate. Generally speaking, adiabatic compression is widely considered the most efficient ignition mechanism for directly kindling a nonmetallic material in gaseous oxygen and has been implicated in many fire investigations. Because of the ease of ignition of many nonmetallic materials by this heating mechanism, many industry standards prescribe this testing. However, the results between various laboratories conducting the testing have not always been consistent. Research into the test method indicated that the thermal profile achieved (i.e., temperature/time history of the gas) during adiabatic compression testing as required by the prevailing industry standards has not been fully modeled or empirically verified, although attempts have been made. This research evaluated the following questions: 1) Can the rapid compression process required by the industry standards be thermodynamically and fluid dynamically modeled so that predictions of the thermal profiles be made, 2) Can the thermal profiles produced by the rapid compression process be measured in order to validate the thermodynamic and fluid dynamic models; and, estimate the severity of the test, and, 3) Can controlling parameters be recommended so that new guidelines may be established for the industry standards to resolve inconsistencies between various test laboratories conducting tests according to the present standards?

Gaussian process models for sensor-centric robot localisation

This paper presents an approach to building an observation likelihood function from a set of sparse, noisy training observations taken from known locations by a sensor with no obvious geometric model. The basic approach is to fit an interpolant to the training data, representing the expected observation, and to assume additive sensor noise. This paper takes a Bayesian view of the problem, maintaining a posterior over interpolants rather than simply the maximum-likelihood interpolant, giving a measure of uncertainty in the map at any point. This is done using a Gaussian process framework. To validate the approach experimentally, a model of an environment is built using observations from an omni-directional camera. After a model has been built from the training data, a particle filter is used to localise while traversing this environment

Cohabitation : placing disability centre stage

The play Cohabitation places disability centre stage by creating a three dimensional protagonist who is also a wheelchair user. The accompanying exegesis examines the challenges associated with creating such a character for theatre, using a practice-led methodology. During the process of writing my case study play, I have investigated the international literature, reflected on my experience as a physician specialising in rehabilitation and collaborated with members of the Australian and international disability communities. I have also reflected on the historical stereotypes associated with disability and integrated the contemporary experience of wheelchair users into my script. By organising a production of the play in Australia and directing a rehearsed reading of the play in New York, I was able to scrutinise my additional goal of casting an actor who was also a wheelchair user. My research illuminates the issues involved in writing and producing a play in which the lead character also has a physical disability, and I would hope, offers insight into the creation of such a character and script.

The development of a conceptual framework for a district 4-Year Pavement Management Plan, implementation of network-level project screening process

The Texas Department of Transportation (TxDOT) is concerned about the widening gap between preservation needs and available funding. Funding levels are not adequate to meet the preservation needs of the roadway network; therefore projects listed in the 4-Year Pavement Management Plan must be ranked to determine which projects should be funded now and which can be postponed until a later year. Currently, each district uses locally developed methods to prioritize projects. These ranking methods have relied on less formal qualitative assessments based on engineers’ subjective judgment. It is important for TxDOT to have a 4-Year Pavement Management Plan that uses a transparent, rational project ranking process. The objective of this study is to develop a conceptual framework that describes the development of the 4-Year Pavement Management Plan. It can be largely divided into three Steps; 1) Network-Level project screening process, 2) Project-Level project ranking process, and 3) Economic Analysis. A rational pavement management procedure and a project ranking method accepted by districts and the TxDOT administration will maximize efficiency in budget allocations and will potentially help improve pavement condition. As a part of the implementation of the 4-Year Pavement Management Plan, the Network-Level Project Screening (NLPS) tool including the candidate project identification algorithm and the preliminary project ranking matrix was developed. The NLPS has been used by the Austin District Pavement Engineer (DPE) to evaluate PMIS (Pavement Management Information System) data and to prepare a preliminary list of candidate projects for further evaluation.

Performance recordivity : studio music in a live context

A broad range of positions is articulated in the academic literature around the relationship between recordings and live performance. Auslander (2008) argues that “live performance ceased long ago to be the primary experience of popular music, with the result that most live performances of popular music now seek to replicate the music on the recording”. Elliott (1995) suggests that “hit songs are often conceived and produced as unambiguous and meticulously recorded performances that their originators often duplicate exactly in live performances”. Wurtzler (1992) argues that “as socially and historically produced, the categories of the live and the recorded are defined in a mutually exclusive relationship, in that the notion of the live is premised on the absence of recording and the defining fact of the recorded is the absence of the live”. Yet many artists perform in ways that fundamentally challenge such positions. Whilst it is common practice for musicians across many musical genres to compose and construct their musical works in the studio such that the recording is, in Auslander’s words, the ‘original performance’, the live version is not simply an attempt to replicate the recorded version. Indeed in some cases, such replication is impossible. There are well known historical examples. Queen, for example, never performed the a cappella sections of Bohemian Rhapsody because it they were too complex to perform live. A 1966 recording of the Beach Boys studio creation Good Vibrations shows them struggling through the song prior to its release. This paper argues that as technology develops, the lines between the recording studio and live performance change and become more blurred. New models for performance emerge. In a 2010 live performance given by Grammy Award winning artist Imogen Heap in New York, the artist undertakes a live, improvised construction of a piece as a performative act. She invites the audience to choose the key for the track and proceeds to layer up the various parts in front of the audience as a live performance act. Her recording process is thus revealed on stage in real time and she performs a process that what would have once been confined to the recording studio. So how do artists bring studio production processes into the live context? What aspects of studio production are now performable and what consistent models can be identified amongst the various approaches now seen? This paper will present an overview of approaches to performative realisations of studio produced tracks and will illuminate some emerging relationships between recorded music and performance across a range of contexts.

A process evaluation of a comprehensive school based injury prevention program

A process evaluation enables understanding of critical issues that can inform the improved, ongoing implementation of an intervention program. This study describes the process evaluation of a comprehensive, multi-level injury prevention program for adolescents. The program targets change in injury associated with violence, transport and alcohol risks and incorporates two primary elements: an 8-week, teacher delivered attitude and behaviour change curriculum for Grade 8 students; and a professional development program for teachers on school level methods of protection, focusing on strategies to increase students’ connectedness to school.

Gender and new venture outcomes : not better or worse, just different

We investigate how differences in the goals of male and female entrepreneurs affect business resources, outcomes and satisfaction with those outcomes. To investigate this topic we use the CAUSEE database to access a longitudinal sample of 247 female-controlled and 332 male-controlled young Australian firms. We find that female entrepreneurs are less motivated by business growth, invest less time developing their businesses and yet even when profits are lower they are more satisfied with their profit performance. Our results support prior qualitative studies indicating that female business owners want greater flexibility and manageability in terms of balancing their family and work responsibilities. Our findings also suggest that future dialogue on firm performance should include an analysis of the entrepreneur’s achievement in terms of both financial and personal goals.

Context-aware methods for process modeling

Recent studies have started to explore context-awareness as a driver in the design of adaptable business processes. The emerging challenge of identifying and considering contextual drivers in the environment of a business process are well understood, however, typical methods used in business process modeling do not yet consider this additional contextual information in their process designs. In this chapter, we describe our research towards innovative and advanced process modeling methods that include mechanisms to incorporate relevant contextual drivers and their impacts on business processes in process design models. We report on our ongoing work with an Australian insurance provider and describe the design science we employed to develop these innovative and useful artifacts as part of a context-aware method framework. We discuss the utility of these artifacts in an application in the claims handling process at the case organization.

Towards human and social innovation: not wanting to know in order to create

The formation of a venture relies, in part, upon the participants reaching a shared understanding of purpose and process. Yet in circumstances of great complexity and uncertainty how can such a shared understanding be created? If the response to complexity and uncertainty is to seek simplicity in order to find commonality then what is lost and what is at risk? Can shared understandings of purpose and process be arrived at by embracing complexity and uncertainty and if so how? These questions led us to explore the process of dialogue and communication of a team in its formative stages. Our interests were not centred upon the behavioural characteristics of the individuals in the 'forming' stage of group dynamics but rather the process of cognitive and linguistic turns, the wax and wan of ideas and, the formation of shared meaning. This process of cognitive and linguistic turns was focused thematically on the areas of foresight, innovation, entrepreneurship, and public policy. This cross disciplinary exploration sought to explore potential synergies between these domains, in particular in developing a conceptual basis for long term thinking that can inform wiser public policy.

Teen content creators : experiences of using information to learn

As access to networked digital communities increases, a growing number of teens participate in digital communities by creating and sharing a variety of content. The affordances of social media - ease of use, ubiquitous access, and communal nature - have made creating and sharing content an appealing process for teens. Teens primarily learn the practices of encountering and using information through social interaction and participation within digital communities. This article adopts the position that information literacy is the experience of using information to learn. It reports on an investigation into teens experiences in the United States, as they use information to learn how to create content and participate within the context of social media. Teens that participate in sharing art on sites such as DeiviantArt, website creation, blogging, and/or posting edited videos via YouTube and Vimeo, were interviewed. The interviews explored teens' information experiences within particular social and digital contexts. Teens discussed the information they used, how information was gathered and accessed, and explored the process of using that information to participate in the communities.

Research process management

Though the value of a process-centred view for the understanding and (re-)design of corporations has been widely accepted, our understanding of the research process in Information Systems (IS) remains superficial. A process-centred view on IS research considers the conduct of a research project as a sequence of activities involving resources, data and research artifacts. As such, it helps to reflect on more effective ways to conduct IS research, to consolidate and compare diverse practices and to complement the focus on research methodologies with research project practices. This paper takes a first step towards the discipline of ‘Research Process Management’ by exploring the features of research processes and by presenting a preliminary approach for research process design that can facilitate modelling IS research. The case study method and the design science research method are used as examples to demonstrate the potential of such reference research process models.

The internetalisation of information, knowledge and interaction components of the firm’s internationalisation process

Transcending traditional national borders, the Internet is an evolving technology that has opened up many new international market opportunities. However, ambiguity remains, with limited research and understanding of how the Internet influences the firm’s internationalisation process components. As a consequence, there has been a call for further investigation of the phenomenon. Thus, the purpose of this study was to investigate the Internet’s impact on the internationalisation process components, specifically, information availability, information usage, interactive communication and international market growth. Analysis was undertaken using structural equation modelling. Findings highlight the mediating impact of the Internet on information and knowledge transference in the internationalisation process. Contributions of the study test conceptualisations and give statistical validation of interrelationships, while illuminating the Internet’s impact on firm internationalisation.

CAUSEE Dataset and documentation

The Comprehensive Australian Study of Entrepreneurial Emergence (CAUSEE) is the largest study of new firm creation ever undertaken in Australia. The project provides an exciting opportunity to fundamentally improve our understanding of independent entrepreneurship in Australia by studying factors that initiate, hinder and facilitate the process of emergence of new economic activities and organisations. The longitudinal project has followed a large random sample of nascent firms (n=625) and young firms (n=559) over a six year period. NFs are on-going start-up efforts while YFs are already established but less than four years old. The study also includes a comparison group of non-founders and over-samples of over 100 high potential start-ups in each category. The CAUSEE dataset file contains hundreds of variables throughout 5 waves of data collection. Extensive documentation on the dataset is available in the related handbook. The CAUSEE project has received significant external funding from the Australian Research Council (DP0666616 and LP0776845); National Australia Bank; BDO Australia, and the Australian Government Department of Industry, Innovation and Science.

A Bayesian‐Markov process for reliability prediction

Accurate reliability prediction for large-scale, long lived engineering is a crucial foundation for effective asset risk management and optimal maintenance decision making. However, a lack of failure data for assets that fail infrequently, and changing operational conditions over long periods of time, make accurate reliability prediction for such assets very challenging. To address this issue, we present a Bayesian-Marko best approach to reliability prediction using prior knowledge and condition monitoring data. In this approach, the Bayesian theory is used to incorporate prior information about failure probabilities and current information about asset health to make statistical inferences, while Markov chains are used to update and predict the health of assets based on condition monitoring data. The prior information can be supplied by domain experts, extracted from previous comparable cases or derived from basic engineering principles. Our approach differs from existing hybrid Bayesian models which are normally used to update the parameter estimation of a given distribution such as the Weibull-Bayesian distribution or the transition probabilities of a Markov chain. Instead, our new approach can be used to update predictions of failure probabilities when failure data are sparse or nonexistent, as is often the case for large-scale long-lived engineering assets.