Mining Feasibility Study Checklist: How to Read a Study

Summary box

• Feasibility studies are decision tools, not marketing brochures.


• The biggest risks hide in assumptions on costs, recovery, schedule, and permitting.


• Compare assumptions to peers using projects and filings.


• Sensitivity analysis matters more than headline NPV or IRR.

Last updated: 2026-02-01

A mining feasibility study checklist helps investors spot weak assumptions before they become dilution or schedule risk. Use this guide alongside Mining Terminal filings and projects to compare a project to peers and test whether the economics hold up. If you want a quick primer on costs first, start with the AISC guide.

What a feasibility study is and why it matters

A feasibility study is the most detailed economic and engineering report for a mining project. It translates geology into a mine plan, then into a cash flow model. A strong study can unlock financing and construction. A weak study can still lead to a capital raise, but it raises the odds of delays and cost overruns.

Investors should view a feasibility study as a risk map. It shows what the project depends on, which inputs are solid, and which are still guesswork. The goal is not to accept the report at face value, but to stress test the assumptions.

Feasibility study vs pre feasibility vs scoping

Mining studies come in stages. Each stage increases detail and reduces uncertainty, but also raises costs.

• Scoping or preliminary economic assessment (PEA): early level concept with wide uncertainty. Useful for initial economics but high risk.
• Pre feasibility study (PFS): tighter engineering, more data on mining and processing, but still subject to major change.
• Feasibility study (FS): highest level of detail, designed to support financing and final investment decisions.

A feasibility study is still not a guarantee of success. Financing, permitting, and construction are separate hurdles. That is why this checklist emphasizes risk and sensitivity, not just base case numbers.

Track catalyst timing in the mining stocks catalysts calendar and monitor updates in news.

How to use this mining feasibility study checklist

Start with the executive summary, but do not stop there. The summary is often optimistic. Use the checklist to confirm the assumptions behind the headline numbers and compare them to peers.

A practical workflow:

• Read the summary and project description.


• Jump to resources and reserves, then mine plan.


• Review metallurgy and processing.


• Study capex, opex, and schedule.


• Review the economic model and sensitivities.


• Validate permitting and jurisdiction risk.


• Check financing plan and dilution risk.

Use Mining Terminal to compare each section to similar projects in the same commodity and jurisdiction.

1) Project overview and scope

The project overview sets the frame. Look for clarity on mine life, production rates, and study scope.

Key checks:

• Mine life: Does it rely on proven reserves or inferred resources?


• Production rate: Is it realistic given the deposit and infrastructure?


• Mining method: Open pit vs underground and why it fits the orebody.


• Project scale: Is the size appropriate for the company balance sheet?

A small company proposing a very large build should trigger financing and execution questions. Use the mining stock valuation methods guide to see how scale affects valuation expectations.

2) Geology, resources, and reserves

Resources are not reserves. A feasibility study should convert most of the economic material into reserves, but it depends on metallurgical and economic assumptions.

Checklist:

• Resource category: Measured and indicated resources should dominate reserves.


• Cut off grade: Low cut off grades can inflate tonnage. See cut off grade explained.


• Grade distribution: Are high grade zones concentrated in early years?


• Reserve conversion rate: Low conversion can signal uncertain economics.

If the study relies on inferred resources for early cash flow, treat the schedule as higher risk.

3) Mine plan and dilution

Mining method and scheduling drive costs and grades. This is where optimism can hide.

Key questions:

• Strip ratio: For open pit projects, is the strip ratio realistic? See strip ratio explained.


• Dilution assumptions: Are they in line with similar deposits?


• Recovery of dilution: Does the plan account for grade control and mining losses?


• Flexibility: Can the plan adjust if commodity prices fall?

If the mine plan depends on perfect grade control, the risk is higher than the base case suggests.

4) Processing and metallurgy

Metallurgy often decides whether a project works. Recovery assumptions are as important as grade.

Checklist:

• Recovery rates: Are they based on test work or assumptions?


• Process flow sheet: Is it standard or complex?


• Concentrate quality: Are there impurities or penalties?


• Pilot plant results: If available, do they support the recovery claims?

Use the metallurgical recovery guide to interpret recovery assumptions. Projects with complex metallurgy often face higher capex and schedule risk.

5) Infrastructure and logistics

Infrastructure can make or break economics. Remote projects often carry hidden costs.

Key checks:

• Power access: Grid power vs on site generation.


• Water availability: Source, permitting, and long term reliability.


• Transport: Distance to ports, smelters, or customers.


• Third party infrastructure: Capacity and contract terms.

If infrastructure is not secured, capex and schedule risk should be higher. Use the mining permitting timeline guide for timeline context.

6) Capital expenditure (capex)

Capex assumptions can be the largest driver of project failure. The most common mistake is underestimating capex during early stages.

Checklist:

• Capital intensity: Capex per annual production unit.


• Contingency: Is a realistic contingency included?


• Owner costs: Does the budget include project management and financing costs?


• Inflation assumptions: Are costs based on current market pricing?

Compare capex to peers and watch for large step changes without explanation. A feasibility study should detail how cost estimates were built.
Look for a clear split between direct costs (plant, mine, infrastructure) and indirect costs (owner's costs, EPCM, contingency). Projects that hide indirect costs often show early capex surprises.

Capex should also include escalation for long lead items such as mills, crushers, and power infrastructure. If a study assumes flat costs during a multi-year build, treat the estimate as optimistic. Use mining project financing options to assess whether the financing plan can absorb capex surprises.
Check whether the project will be owner-built or delivered under an EPC or EPCM contract. Fixed-price EPC contracts can reduce capex risk but may limit flexibility, while owner-built projects can drift if procurement or scope control is weak. If the contract strategy is unclear, capex risk is higher.

7) Operating costs (opex)

Operating costs determine margins. Small changes can swing cash flow and valuation.

Key questions:

• Cost breakdown: Mining, processing, G&A, transport.


• Energy costs: Fuel and power assumptions.


• Labor assumptions: Wage levels and workforce size.


• Reagent and consumables: Are prices realistic?

Use the AISC guide to interpret cost structures. Projects with narrow margins require more conservative price assumptions.
Check whether the cost model includes consumables that are volatile, such as diesel, cyanide, sulfuric acid, or lime. If these inputs are missing or outdated, the opex estimate may be too low.

Opex should also be benchmarked against cost curves for the commodity. If a project claims to be in the lowest cost quartile, verify that the assumptions are realistic. Use mining stocks overview to compare cost positioning across peers.
Labor productivity assumptions matter as much as wage rates. If the study assumes high productivity in a region with limited mining labor, the opex may be understated. Compare labor assumptions to similar projects in filings.

8) Schedule and ramp up

Schedules are often optimistic. Delays increase financing needs and reduce NPV.

Checklist:

• Construction timeline: Is it realistic for the jurisdiction and project complexity?


• Ramp up period: Does it assume smooth commissioning?


• Critical path risks: Are key components dependent on a single contractor or permit?

If the project timeline depends on perfect execution, use a higher discount rate or lower valuation multiple.
Check for long-lead equipment and supply chain constraints. A single delayed item can push the schedule by months. Winter access, labor shortages, and contractor capacity also create schedule risk.

If the schedule assumes a short ramp up, verify whether the processing route is proven at scale. For complex metallurgy, ramp up assumptions should be conservative. Use metallurgical recovery explained to sanity check recovery ramp assumptions.
Look for schedule contingency. A feasibility study without explicit schedule buffers tends to assume best-case outcomes. Investors should add their own buffer for complex jurisdictions or first-of-kind processing plants.

9) Economic model and assumptions

NPV, IRR, and payback are the headline metrics, but they depend on assumptions.

Key checks:

• Commodity price deck: Are prices conservative or aggressive?


• FX assumptions: Are exchange rates stable or volatile?


• Discount rate: Does it reflect jurisdiction and project risk?


• Royalties and taxes: Are they modeled accurately?

Compare the price deck to current market conditions and long term averages. If the study uses peak pricing, the NPV may be inflated.
Look for sensitivity to both price and cost in the economic model. Many models show price sensitivity but understate cost inflation risk. A realistic model should include downside cases where prices fall and costs rise at the same time.

Related reading: mining feasibility study checklist, mine life and reserve life index, build a mining stocks watchlist, and mining stock catalysts. Additional context: mining stocks list, and mining portfolio construction.

If the discount rate is low relative to jurisdiction risk or project complexity, the valuation may be overstated. Use mining jurisdiction checklist to align discount rates with political and permitting risk.
Check whether sustaining capital and closure costs are included in the cash flow. Projects can look attractive on initial capex but weak after sustaining and closure obligations are added. Use mining project risk checklist to validate long-term liabilities.

10) Sensitivity analysis

Sensitivity analysis is where you learn what really matters. Investors should care more about sensitivity than the base case.

What to look for:

• Price sensitivity: How does NPV change with commodity prices?


• Capex sensitivity: How much does a 10 to 20 percent increase reduce returns?


• Recovery sensitivity: Is the project fragile to small metallurgical changes?


• Schedule sensitivity: How much does a one year delay reduce NPV?

If a project breaks at modest downside scenarios, it needs a higher risk discount.
Check whether the study includes two-way sensitivity or stress cases. A single-variable sensitivity can hide the combined impact of price, cost, and schedule shocks. If the project only works under a narrow set of assumptions, the margin of safety is thin.

Use commodity cycles guide to align sensitivity inputs with realistic cycle risk rather than short-term spot prices.

11) Permitting and environmental approvals

Permitting is often the largest schedule risk. A study should detail permit status and remaining steps.

Checklist:

• Permits obtained: Which are approved and which are pending?


• Timeline assumptions: Are they based on real jurisdiction history?


• Community consultation: Is there evidence of engagement?


• Environmental compliance: Are mitigation plans defined?

Use the mining jurisdiction checklist to assess jurisdiction risk and the mining permitting timeline guide to evaluate the schedule.
If baseline studies are incomplete, the permitting timeline is almost always longer than the study assumes. Verify whether baseline work covers multiple seasons and whether community consultation is ongoing or only planned.
Reclamation bonds and closure obligations can also affect financing capacity. If the study does not disclose closure security requirements, the capital structure may be incomplete.

12) Financing plan and dilution risk

A feasibility study should outline how the project will be funded. If the funding plan is vague, dilution risk is higher.

Key questions:

• Debt vs equity mix: Is the capital structure realistic for the company?


• Offtake agreements: Are there binding offtake terms?


• Streaming or royalties: Are these used, and at what cost?


• Liquidity buffer: Is there enough cash to cover overruns?

Use the mining project financing options guide to evaluate financing structures. If a company will need multiple equity raises, adjust valuation accordingly.
Look for the funding gap between current cash and total capex. A large gap relative to market cap signals dilution risk. Use dilution and recovery mining to model how financing changes per share value.
If the plan relies on offtake, confirm whether terms are binding and whether pricing is fixed or floating. A low-price offtake can reduce downside risk but also cap upside.

13) Risks and mitigation plan

Every feasibility study includes a risk section. The quality of this section matters. A strong study identifies specific risks and mitigation strategies, not generic statements.

Look for:

• Technical risks: Metallurgy, geotechnical issues, water balance.


• Operational risks: Labor availability, contractor capacity.


• Market risks: Concentrate pricing, demand cycles.


• Regulatory risks: Permitting delays, policy changes.

Use the mining project risk checklist to compare the study risk register to industry norms.
If the risk register omits critical items such as tailings stability, water availability, or community consent, the study may be overly promotional. Realistic risk registers often include schedule buffers and cost contingencies that reflect these uncertainties.

14) Management and execution capability

A feasibility study is only as good as the team that executes it. Assess management track record and operational experience.

Questions to ask:

• Has the team built a similar project before?


• Does the company have in house technical expertise?


• Are key roles filled or still hiring?

Execution risk increases if the company relies heavily on external contractors for core functions.
Check whether the operator has built or operated a similar mine in the same jurisdiction. Experience in comparable geology and permitting environments matters more than generic mining experience.

If management has a history of cost overruns or schedule delays, discount the study's assumptions. Use news to review past project execution outcomes.
Owner-operator models can deliver stronger long-term margins, but they require deeper operational expertise. If the company lacks that expertise, the execution risk rises even if the feasibility study looks strong on paper.

Related reading: comparable analysis for mining stocks.

15) Red flags to watch for

These signals indicate that the study may be overly optimistic:

• Low contingency or missing owner costs.
• Aggressive price deck without sensitivity disclosure.
• Heavy reliance on inferred resources in early years.
• Complex metallurgy with limited test work.
• Permitting timelines that assume no delays.

If two or more red flags appear, require a wider margin of safety. Red flags should not be viewed in isolation. A single issue may be manageable, but multiple issues often compound. If the study is optimistic on capex, permitting, and recovery at the same time, the downside risk is much higher.

When in doubt, compare the feasibility study to peers in the same commodity and jurisdiction. If the study assumptions are materially more optimistic than peers, the base case is likely inflated.

Related reading: mining M&A takeover signals.

How to use Mining Terminal for feasibility study analysis

Mining Terminal helps you validate key assumptions:

• Compare resource and reserve data across projects.
• Track updates and revisions in filings.
• Monitor permitting updates in news.
• Review peer valuation metrics in stocks.

The goal is to build a consistent, repeatable process that highlights risk before capital is committed. If you compare two feasibility studies, normalize the inputs. Align price decks, discount rates, and study stage, then compare capex intensity and schedule risk. Without normalization, the conclusions are usually driven by assumptions rather than asset quality. See the mining stocks overview for more context.

Checklist summary

Use this quick summary to review any feasibility study:

• Project scope, mine life, and production rates are realistic.
• Resource categories and reserve conversion are clear.
• Mining method and dilution assumptions are credible.
• Processing flow sheet and recoveries are backed by test work.
• Capex and opex include realistic contingencies and inflation.
• Economic model uses conservative price and FX assumptions.
• Sensitivity analysis shows resilience to downside scenarios.
• Permitting status and timelines are clear.
• Financing plan is credible and minimizes dilution.
• Risk register includes specific, not generic, risks.

If the project fails on more than two of these points, treat the feasibility study as a preliminary view rather than a bankable plan. Investors should adjust position size and timing accordingly. For higher-risk projects, consider waiting for an updated study or permitting milestone before committing capital. The opportunity cost of waiting is often lower than the downside of financing surprises. A feasibility study is a snapshot, not a guarantee. Recheck assumptions whenever commodity prices, costs, or permitting timelines shift. Regular updates are often more important than the initial study. If updates are delayed, assume higher uncertainty. Stale studies rarely reflect current costs or permitting reality. Treat them as directional, not definitive. Use updated cost data when possible. Track timing risk with the mining stocks catalysts calendar to stay aligned with upcoming updates. See the mining stocks overview for more context.

Related reading: mining stocks overview and NAV vs market cap for mining stocks.

FAQ

What is a mining feasibility study?
A mining feasibility study is a detailed technical and economic report that evaluates whether a project is likely to be viable. It includes mine design, processing, capital costs, operating costs, and cash flow analysis.

Is a feasibility study enough to de risk a project?
It reduces risk, but execution, financing, and permitting still matter. Many projects fail despite strong studies.

How often should a feasibility study be updated?
After major changes in commodity prices, costs, mine plan, or permitting status. A study can become stale quickly in volatile markets.

Do feasibility studies include reserves?
Yes, they typically convert measured and indicated resources into reserves based on economic assumptions.

What is the most important part of a feasibility study?
Sensitivity analysis. It shows how fragile or resilient the project is to changes in price, costs, and schedule.

Sources

• NI 43-101 disclosure standard: https://www.osc.ca/en/securities-law/instruments-rules-policies/4/43-101/national-instrument-ni-43-101-standards-disclosure-mineral-projects-0
• SEC S-K 1300 final rule: https://www.sec.gov/files/rules/final/2018/33-10570.pdf
• JORC Code 2012: https://www.jorc.org/docs/JORCcode2012.pdf

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Disclaimer: This analysis is provided for informational purposes only and does not constitute investment advice. Mining Terminal is not a registered investment advisor. Mining stocks carry significant risks including commodity price volatility, operational challenges, and regulatory changes. Always conduct your own research and consult with a qualified financial advisor before making investment decisions. Data sourced from company filings and may not reflect the most recent developments.