Strong resource growth does not increase mining company returns while mineral asset impairments tank mining company stock prices. What if mining companies avoided resource ownership?
A detailed study of mining company impairments shows which errors destroy the most value for mining companies.
Many mining companies have generated returns similar to the commodities they produced over the past 20 years. However, some companies have significantly outperformed and underperformed their commodities. Here are the companies that broke free from the commodities they were producing.
Much attention is paid to project execution; however, most projects are set up for failure at the forecasting stage. Here is a look at the three principal causes of project forecasting error.
Public communication from mining company leadership typically focuses on metal prices, production, reserves, and costs. However, avoiding asset impairments through better project forecasting is the most critical factor for improving shareholder returns.
Declining grades and rising costs are likely to push mining company profitability downwards over time. As a result, mining companies must make fundamental changes to how they operate to break free from these pressures.