Analysis of mineral products proposed for auction by Mexican government

For the Mexican government, CRA experts analyzed selected mineral prospects proposed for auction and made recommendations for the design of the auctions. The first step of the analysis was to review in some detail the geological, geochemical, geophysical, and assay evidence with our client’s personnel. The properties included gold, silver, base metal and non-metallic properties such as phosphates. The CRA team estimated a number of parameters that would be relevant for an assessment of the potential value of the prospects (e.g., resources, ore grades, operating and capital costs, etc.). A simulation analysis was then employed to estimate the distribution of after- tax NPVs for each project. These results reflected the range of variation due to the uncertainty in assessing geological and financial information. The Mexican government utilized our recommended strategy and reserve prices and was successful in selling several properties above the reserve price.