How OreScore approaches mining valuation

Step one: the market snapshot

You enter share price, shares outstanding, fully diluted shares, debt, cash and other liabilities. Market capitalisation is price multiplied by shares. Enterprise value adjusts market capitalisation for debt, cash and other claims, giving the price the market puts on the operating business. Currency can be set, and a foreign-exchange reference is used for conversion, but all other figures are those you typed.

Step two: resources and screening

Resource lines derive contained metal from tonnes and grade or accept an explicitly unit-labelled contained amount. The resource screening value then applies the entered metal price, recovery, payability and ownership, with category weights of 78% for proven and probable reserves, 58% for measured and indicated resources, and 28% for inferred resources. These are illustrative screening weights, not certified probabilities or proof of economic extraction. Inferred material is not a reserve.

The model distinguishes physical contained metal from its recovery- and confidence-weighted screening value. In-ground screening ignores project capital, cash-flow timing and tax; it is not a feasibility-study NAV. Keep ounces and pounds separate when comparing physical inventories.

Where modelled annual cash flow is positive, EV/cash flow is enterprise value divided by that cash flow. The separate fair-value screen requires an explicit positive multiple: annual cash flow times that chosen multiple, less debt and other liabilities plus cash, divided by fully diluted shares. There is no universal correct multiple.

Step three: the optional mine plan

The optional project model uses a simplified annual cash-flow level, finite mine life, linear ramp-up, initial capital with contingency, discounted closure costs and a discount rate. Entered tax, royalty and sustaining capital adjust the cash flow. It is not a detailed year-by-year feasibility model or a consolidated corporate cash-flow forecast. Leave optional inputs untouched when you cannot support them: displayed defaults are not verified facts and do not affect the model until entered.

Costs need one rule: all-in sustaining cost already includes sustaining capital, so do not subtract sustaining capex a second time. The project-wide sustaining-capital control prevents this deduction when a production commodity uses AISC; in a mixed-metal model, reconcile the basis across all commodities rather than treating each cost selector independently.

Step four: risk and scenarios

Risk scores for metallurgy, permitting, execution, funding, jurisdiction and social licence, plus an execution probability, produce a risked NAV. The numbers are your judgements, not measurements. Scenario cases then flex price, production and capital together. Treat the spread between bear and bull as the main message, and treat every output as a prompt for more research.