Mineral deposits are used to buy, sell, options and venture capital on the basis of the relative value of their existence and discovery. The intrinsic value of an asset is discovered therefore based on the potential that can be exploited. One measure of potential value is the amount of resources that can be expended to discover a viable mineral deposit.
The cost method is based on the premise that a mineral deposit is worth past spending on it plus a guaranteed future value to verify its residual potential. The results of past mining are analyzed to retain only those that are cost effective and are involved in determining residual value. Guaranteed future costs include a reasonable mining budget to test potential value.
Minerals are valued for a variety of reasons, including M&A activities, corporate equitization, underpinning property agreements, litigation, mining and insurance.
Valuation of mineral mines
Valuation of a mineral mine is the determination of the true value of a mineral mine and its value in exploitable reserves.
Mine Valuation Overview: Mineral deposits are used for buying, selling, options and venture capital on the basis of the relative value of their existence and discovery. The intrinsic value of a discovered mineral deposit is therefore based on the potential that can be exploited. One measure of potential value is the amount of resources that can be spent exploring a viable mineral deposit.
Appraisal of mineral mines and resource values for the purposes of:
- Valuation for purchase, sale, transfer, capital contribution to joint ventures and associations.
- Valuation of the conversion of property ownership of the enterprise.
- Valuation for tax calculation and bookkeeping and financial statements.
- Valuation for investment and capital contribution to enterprises, equitization.
- Valuation to preserve assets.
- Valuation to prove assets for bank loans...
Valuation of mineral mines includes:
- Valuation of mineral resources: petroleum, coal, bauxite, tin, iron, copper, gold, apatite...
- Valuation of energy resources: coal, oil, hydroelectricity, solar energy, wind energy, tidal energy...
- Valuation of marine resources.
Classification of mineral mines: Mineral mines to be determined include 3 types, mines under research and exploration, mines that have been completed exploration, and mines that have been put into operation.
Methods of valuing mineral mines: depending on the characteristics of each enterprise and the stage of the mining project, one of three appropriate valuation methods shall be applied, including:
- Comparative method;
– Income (investment) method;
Profit method.
Hoang Quan Appraisal is one of the pioneers in Vietnam to research and apply international methods of Resource Valuation. On that basis, with a team of experienced staff and with the participation of domestic and international experts, over the past time we have conducted valuation of forest resources, mines, minerals... services for calling for investment capital of Vietnamese enterprises.
