Mining Problem - A gold mine is to be established, with capital injection of 180 million rands now, and 150 million a year later and 100million rand two years later, whose life is 5 yea rs with a total ore reserves of 7.7million tonnes. The hurdle rate has been calculated to be 13%. A royalty of 1.25% of the gross sales is to be paid. Capital injection Tonnes Milled Mill Head Grade Milling Recovery;r Variable costs Fixed costs Royalties Project Year 0 1 2 millions 180 150 100 mil t aft 96 millions millions '14: 3 4 5 6 7 1.3 1.5 1.8 1.8 1.3 3.2 3.5 3.5 4.0 4.0 75% ?8% 80% 85% 85% 1'80 9T5 1200 1359 1059 25 2? 29211 31.50 34 1.25125 1.25 1.25 Question . Model a deterministic cashflow for mineral economics