Pre-Feasibility Studies

A pre-feasibility study (PFS) compares alternatives and establishes a preferred development case. CRIRSCO's advisory June 2024 Template requires technical and financial evidence sufficient for a Competent Person to assess resource-to-reserve conversion, at lower confidence than a feasibility study. National or regional reporting rules govern public disclosure.^[1]

The engineering task is to explain why the preferred development case deserves further commitment, what makes it workable and which uncertainties could overturn that preference. A PFS should leave a traceable choice, together with the evidence and conditions behind it.

The Decision the Study Must Resolve

The study begins by defining the decision, rather than assuming that the only question is whether to proceed. Possible decisions include selecting an extraction approach, choosing an initial production scale, deciding whether existing facilities can support an expansion, or determining that more investigation is necessary before alternatives can be ranked. These are different questions and require different comparisons.

Mining method, production rate, grade profile and the risks of each option belong in the same strategic assessment. Tholana and Neingo's mineral-asset planning framework connects these choices with deposit characteristics, constraints and economic value. It supports treating the preferred case as a combination of operating decisions, rather than selecting a method independently of the production strategy.^[2]

For an internal decision review, it is useful to state which alternatives remain credible, which have been rejected and what evidence caused their rejection. An alternative excluded because it cannot satisfy a constraint deserves a different explanation from one rejected because its estimated financial performance is weaker. This distinction makes the recommendation easier to revisit if that constraint or assumption changes.

Establishing the Engineering Basis

The geological model must be connected to a practicable mining assessment. CIM's 2019 guidance links method selection and mine design with geometry, ground conditions, water, dilution, extraction assumptions and production requirements. For an open pit, an optimized shell guides subsequent design; it does not by itself establish the benches, access and operating arrangement. Underground assessment similarly needs an extraction approach and a feasible development and service layout.^[3]

A practical way to organize the basis is to distinguish three kinds of information:

• Evidence: observations, investigation results, tests and documented operating experience relevant to the site.
• Interpretation: geological domains, engineering models and expected responses inferred from that evidence.
• Assumptions: conditions adopted to make the study calculable where information is incomplete or inherently forward-looking.

Each consequential assumption needs an owner, a stated basis and an explanation of how it affects the choice. Labeling an assumption does not make it acceptable: the review still needs to ask whether a plausible change would invalidate a major part of the preferred case. Equally, commissioning additional investigation without identifying the decision it informs can add information without resolving the uncertainty that matters.

Comparing Complete Development Options

Alternatives should be compared as coherent systems. A change in mining scale can require a different processing arrangement, access system or sequence of infrastructure investment. Comparing a larger plant with a smaller plant while holding an incompatible mine schedule fixed would answer a different question from comparing complete development cases.^[2]

The following comparison structure is an engineering aid, not a prescribed reporting template:

The purpose is to expose differences that a single headline result can conceal. A case requiring less initial expenditure may carry later investment or schedule dependencies; another may commit more capital before its operating assumptions have been demonstrated. The recommendation should explain the consequence of those differences for the particular decision, rather than assign a universal preference to either arrangement.

Demonstrating the Processing Basis

Processing evidence must relate to the material the mine plan is expected to deliver. CIM's 2022 mineral-processing guidance emphasizes representative sampling across spatial, geological and mineralogical domains, with attention to the production sequence. It also links testwork to recovery variability, product quality and the characteristics of tailings and effluents. For PFS work, the selected route needs evidence of technical and economic applicability; novel or complex processes can require more investigation than familiar ones.^[4]

Consider an illustrative situation in which early samples represent readily treated material, but a later mining phase introduces a materially different domain. The review would need to check whether the tests support that later feed, whether blending changes the operating case, and which production assumptions still require testing.

Linking Design, Schedule and Economics

Capital and operating estimates need an identifiable engineering basis. Nell and Burks describe the connection between mining plans, metallurgical definition, infrastructure and cost estimation, including the different ways utility infrastructure can be financed and charged. Their financial-model discussion also makes production timing, grades, recoveries, prices and expenditure timing explicit inputs. These relationships matter when comparing alternatives: moving a cost between capital expenditure and operating charges does not remove its economic effect.^[5]

A useful consistency review follows one change through the study. If the preferred mining case changes, identify which quantities, production periods, process assumptions, facilities and costs must change with it. Record the adopted case and revision used by each discipline. This helps detect an apparently complete report assembled from individually plausible calculations that describe different development cases.

Estimate confidence must also be stated carefully. AACE's 2022 classification guidance ties estimate class to scope-definition maturity and explains that class does not uniquely determine accuracy. A PFS label therefore cannot justify a universal cost-error range or compensate for unresolved scope.^[6]

Remaining Risk and the Decision Record

Sensitivity questions should be chosen for their relevance to the decision: which assumptions materially affect the preferred case, and how far could they change before the recommendation changes? A separate scenario can examine a coherent combination of changes. For example, a delay in an external utility could affect both construction arrangements and production timing. Treating those consequences separately may obscure the dependency being examined.

The study team can then identify the next work by asking whether it could distinguish between alternatives, remove a significant implementation obstacle or materially improve confidence in the selected case. The resulting investigation programme should explain its purpose and decision consequence. Some uncertainties may remain acceptable for the next commitment; others may justify postponing it.

Where a PFS supports a Mineral Reserve estimate, geological confidence is only one requirement. Under CIM's 2019 Canadian guidance, reserves are estimated from Measured and Indicated Mineral Resources; Inferred Mineral Resources cannot be converted. Mining, processing, infrastructure, environmental, closure, permitting, social and economic factors must also support the estimate. Including material in a production schedule does not itself establish reserve status.^[3]

The decision record should identify the selected case, alternatives considered, evidence used, material exclusions, unresolved assumptions and recommended further work. It should also distinguish endorsement of additional study expenditure from authorization to construct. A defensible PFS conclusion can be conditional or negative: its value lies in making the next commitment better informed, including when the evidence supports redesign, further investigation or a pause.