Pulacayo Project Feasibility Study - Apogee Silver

Pulacayo 1 000 t/d Phase I Feasibility Study - NI 43-101 Technical Report
090644-3-0000-20-IFI-100
21.2.2 Basis of Estimate
The underground mine operating cost estimate is determined from multiple modeling
approaches, life cycle costing for mining fleet, zero based costing for the mining
consumables, first principles costing for the labour and an activity base costing approach for
the remainder of the cost elements. The estimate is derived from two models, the mining
fleet model, which forecasts the maintenance and replacement costs for the entire mining
fleet and all other vehicles owned by the operation, and the consolidated cost model, which
consolidates all other cost components.
The mining OPEX costs consist of the following:
Mining and backfill consumables and materials (drill steel, drill bits and explosives,
backfill reagents: flocculant, cement, wear parts, repair parts, etc.)
Utilities (power, diesel, air, etc.)
Ventilation maintenance schedule
Mining fleet maintenance (Predicted Operating Costs (POC), Ground Engaging Tools
(GET) replacements, etc.
Underground infrastructure maintenance (maintenance costs for piping, electrical
equipment, cable, lighting, instrumentation, etc.)
Technical service consumables (fixed monthly costs for the consumables required for
the maintenance of gas detection equipment incurred every three years)
Labour (derived based on the production requirement for each time period, a leave
allowance of 12% was catered for over and above the labour complement)
Mine administration consumables and transport (fixed monthly costs based on costs
rates provided by Apogee)
The processing OPEX costs consist of:
Operating supplies
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o
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Wear parts (grinding media, liners, filter cloths, etc.)
Reagents and consumables
Services and utilities (energy, engine oil, diesel, etc.)
Maintenance supplies, engine oil and lubricants
Labour
General and administration costs include the personnel costs for management and
administrative support functions, insurance, legal service office expenses, external
assays, camp catering and maintenance, accommodation and transportation (crew,
staff flights, etc.) costs. Environmental testing and studies are also considered. G&A
costs are in accordance with the Owner´s Costs by Apogee. The following items are
included:
Third Party Services: Catering, Camp Cleaning, Maintenance and Refuse Removal
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