Given the following information please explain and show what is incorrect in the answer below for the following question.

A mine produces three separate ore concentrates. The ore concentrates assay 35 % Zn, 38% Cu and 26% Pb respectively. The cost of shipping each of the concentrates to the nearest smelter is $28/ton. The treatment cost for each of the concentrates is $85 /ton and the smelter recovery for each metal in the ore concentrates is 92.5%. The penalty for impurities in each of the concentrates is $33/ton. Assuming the price for Zn is $1.23/lb, Cu is $2.56 /lb and Pb is $1.01/lb calculate:

1. The Total Gross Value of the three concentrates.
2. The Total Net Smelter Return of the three concentrates.

a)

Zn

Price = 1.23 x 2,000 lbs = $2,460/ton

• Shipping = $28/ton
• Treatment = $85/ton

Gross Value = $2,460-$28-$85 = $2,347/ton / 2,000 = $1.17/lb

Cu

Price = 2.56 x 2,000 lbs = $5,120/ton

• Shipping $28/ton
• Treatment = $85/ton

Gross Value = $5120-$28-$85 = $5,007/ton / 2,000 = $2.50/lb

Pb

Price = 1.01 x 2,000 lbs = $2,020/ton

• Shipping $28/ton
• Treatment = $85/ton

Gross Value = $2,020-$28-$85 = $1,907/ton / 2,000 = $0.95/lb.

b)

Zn

Gross Value = $2,347/ton

• Penalty = $33 x 92.5% = $30.53/ton
• Recovery loss = (100%-92.5%) x $2,347 =$176.03/ton

Smelter return = $2,347-30.53-176.03 = $2,140.44/ton / 2000 = $1.07/lb.

Cu

Gross Value = $5,007/ton

• Penalty = $33 x 92.5% = $30.53/ton
• Recovery loss = (100%-92.5%) x $5,007 =$375.53/ton

Smelter return = 5,007-30.53-375.53 = $4600.94/ton / 2000 = $2.30/lb.

Pb

Gross Value = $1,907/ton

• Penalty = $33 x 92.5% = $30.53/ton
• Recovery loss = (100%-92.5%) x $1,907=$143.03/ton

Smelter return = 1,907-30.53-143.03 = $1733.44/ton / 2000 = $0.87/lb.