Using the Discount Cash Flow Model in Preliminary Assessment for Gold Mine Projects

Abstract

This study aims to the examination of the economic potential for the Abu Marawat Gold Project (AGP) in the Eastern Desert of Egypt and prediction the decision about go/not-to-go to invest in the deposit location. Discount Cash Flow (DCF) model used to calculate the Net Present Value (NPV) for the proposed gold mine project. NPV calculated by taking the risk and uncertainty produced from geological and technical factors into account. The actual production and cost data for Sukari Gold Mine (SGM) of Egypt used a benchmark for the theoretical calculation for production and cost data of AGP. From the valuation processes for AGP the NPV for the project predominantly positive, so, the project is acceptable to investment. This study aims to the examination of the economic potential for the Abu Marawat Gold Project (AGP) in the Eastern Desert of Egypt and predicts the decision about go/not-to-go to invest in the deposit location.