Approach and Valuation Methodology in indonesia mining industry part-1

Characteristics Asset of mining industry

Mining assets have different characteristic with other commercial assets. Features, among other mining assets as follows: 

1. Have a relatively wide area in accordance with the Regional Mining Permit (SIPD), power Mining (Mining Permit Business, IUP), Contract of Work (KK), and the Agreement (e.g. the agreement works of coal mining (PKP2B)), which is owned 
2. Have a pattern of integration in the asset processing
3. Has a limited amount of spare production according measurable 
4. Have a mine life with a period of time 
5. Very dependent on the supporting factors, climate, weather conditions and other mining 
6. Very influenced by the type of chart contained in the extractive reserves 
7. Experienced the process of production and continued refinement of mineral products produced 
8. The land where the minerals are not included in the assessment, while the land where the processing is done where mineral / stockpile counted as mining assets. 
9. Must be done mine reclamation and closure on the mining does not operate
   
   
   

In general, the phases of mining activities are as follows:

Research to investigate the geological general public or physics, in the land, waters, and from the air, all with the purpose to create a geological map or to set a common signs of minerals in general (Prospects). Research geological exploration and mining to define more carefully / exact location and nature of the place the mineral. 

Business exploitation of mining with the purpose to produce minerals and how to use it with: 

1. Surface Mining / Open pit
2. Underground Mining) 
3. Underwater Mining / Marine Mine
4. The purification and processing to enhance the quality of minerals and to obtain and utilize the elements contained in the mineral. 
5. Sales of minerals from the results of the processing / purification.