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Vol 179
Pages:
66-70
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Cost estimation of subsurface sites on the basis of comparative approach

Authors:
N. M. Lobov1
O. N. Kasatkina2
S. A. Krylov3
About authors
  • 1 — G.V. Plekhanov Saint Petersburg Mining Institute
  • 2 — G.V. Plekhanov Saint Petersburg Mining Institute
  • 3 — LLC «GEOLEXPERTOCENKA»
Date submitted:
2007-12-24
Date accepted:
2008-02-02
Date published:
2008-06-01

Abstract

The Market Approach (Sales Comparison Approach) in mineral property valuation can boast easy-to-understand logic and yield reliable results. It can provide a reliable indication of a property's market value only if sufficient and representative data on arm’s lengths transactions with mineral properties that have similar characteristics are available. Official publications covering state bids are an essential source of this data. It is important to make sure that the bid be competitive and double-checked for compliance with the arm’s lengths criterion. Price per unit of reserves/resources is the most popular unit of comparison in mineral property valuation. Elements of comparison usually include physical and chemical properties, mineral quantity, applicable extraction and processing methods, geographic location with respect to availability of infrastructure and market for the product. To make models and calculate reliable adjustments, the data on similar mineral properties should be comparable and the elements of comparison selected on a uniform basis. It needs to collect some additional data on comparable mineral transactions.

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References

  1. Донской С.Е. Использование геолого-экономической и стоимостной оценок месторождений полезных ископаемых для решения задач государственного регулирования отношений недропользования и развития минерально-сырьевой базы / С.Е.Донской, А.А.Герт, С.А.Крылов; Министерство природных ресурсов РФ. М., 2006.
  2. Соловьев М.М. Оценочная деятельность (оценка недвижимости): Учеб. пособие / Высшая школа экономики. М., 2002.

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