ECONOMIC EVALUATION OF UNDERGROUND SUBLEVEL STOPING GOLD MINING PROJECT IN PT XYZ USING REAL OPTION METHOD: COMPARISON OF BINOMIAL LATTICE AND FUZZY BINOMIAL LATTICE APPROACHES

• Main Author: Anarkistyani, Nilam
• Format: Final Project
• Language: Indonesia
• Subjects: Pertambangan dan operasi berkaitan
• Online Access: https://digilib.itb.ac.id/gdl/view/51649
• Institution: Institut Teknologi Bandung

Currently, the project evaluation technique most often used in mining industry is still dominated by conventional project evaluation technique, namely the static discounted cash flow method. However, there is characteristic of the mining project cashflow is the uncertainty factor of the calculated variables, while the static DCF assumes there is no risk of the uncertainty of these variables. Therefore, this study seeks to conduct an economic analysis by taking the management flexibility options in dealing with the uncertainty factor, known as real option valuation. The economic evaluation of the sublevel stoping method underground gold mining project at PT XYZ will be carried out using the DCF method to determine economic indicators in the DCF method. Then the economic evaluation will be carried out using the ROV method with the binomial lattice and fuzzy binomial lattice. Furthermore, the results of the economic evaluation of the DCF method, the binomial lattice ROV, and the fuzzy binomial lattice ROV will be compared. The results of this study showed that with the DCF method the NPV is $44.77 million, the IRR is 21.1%, and the PBP is 4.65 years. With the binomial lattice ROV method, the SNPV was obtained for $63.84 million and with the fuzzy binomial lattice ROV method, the EFNPV was obtained for $240.78 million. The results of the economic evaluation using both methods show that the project is economically feasible. However, there is no added value in the DCF method. The binomial lattice ROV method shows an added value of $19.07 million, which can be obtained if the start of the project is postponed for three years. Meanwhile, the fuzzy binomial lattice ROV method shows an added value of $196.01 million.