A model for the evaluation of mining investment proposals under incomplete knowledge

Uncertainty is inherent in mining investment decisions because the knowledge obtainable on conditions which affect choice is limited. The most common techniques for incorporating uncertainty into the investment decision process are here described. The basic features of decision-making under incomplete knowledge are then examined and a new approach to making mining investment decisions is proposed. The proposed approach is based on an a priori ranking of the likelihood of future circumstances and is very straightforward in application. An example is presented and the interpretation of the model is given.