Excellent info Chappy. I've also developed some fairly complex spreadsheets with all sorts of assumptions built in. Things can get complicated very quickly so I use a different method when I want to quickly compare copper projects. Here's how it works:
1. Calculate the Cash Flow
Multiply the annual copper production (lbs / year) by the operating profit per pound ($ / lb).
2. Calculate the Capex Payback
Calculate the number of years to payback the capex using the cash flow determined above.
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Here's an example for Schaft Creek (using $3 copper and operating costs of $0/lb):
(400M lbs copper per year) x ($3.00 - $0.00) = $1200M cash flow per year
(Capex of $3600M) / ($1200 cash flow per year) = 3 year payback
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Now compare this with Teck's proposed Relincho project:
(400M lbs copper per year) x ($3.00 - $1.30) = $680M cash flow per year
(Capex of $3900M) / ($680 cash flow per year) = 5.7 year payback
