1. Given the following core drilling information, metal prices and a tonnage factor of 0.45 m³/tonne for the Tolbert mineralized zone: (25 points)

DDH	Dip (degrees)	Collar Elevation (m)	Northing (m)	Easting (m)	Depth of Mineralized Zone (m)	Grade ( % Zn)	Grade ( % Cu)
1	-90	620	1250	3400	14.2	1.7	1.2
2	-90	599	1250	3700	13.8	2.2	2.1
3	-90	605	1350	3400	10.8	3.8	1.9
4	-90	612	1350	3700	11.6	4.1	2.3
5	-90	602	1450	3450	9.9	3.7	3
6	-90	617	1450	3750	10.2	5	2.9

Metal	Market Price (Can $)
Zinc	$0.96 /lb
Copper	$2.75/lb

1. Calculate, the ore reserve characteristics using the triangular method.

2. Calculate, the expected mine life and daily capacity of the ore deposit based on 260 operating days per year using Taylors equations. Disregard dilution and recovery factors.

3. Based on the results you calculated in a) and b) above, a capital cost of $5,000,000 , an expected total mining cost of $110/ tonne, an expected milling cost of $30/ tonne, an expected mill recovery of 90 percent for each of the valuable metals, shipping costs for the Zn and Cu concentrates (2 different concentrates) to the nearest smelter/refinery of $30/ tonne (for each of the concentrates), smelter recovery of 92% for the Zn and Cu concentrates, treatment costs for each of the concentrates of $65 /tonne, a penalty for impurities in each of the concentrates of $25/ tonne, a grade of 38% for the copper concentrate, a grade of 42% for the Zn concentrate and an overall tax rate of 46%, calculate the maximum investments allowable for the project which would result in a minimum required rate of return of 15% and 20% for the Company. Ignore all other costs such as depletion allowance and depreciation costs. Show all calculations. Discuss your results

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