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On the valuation of coal property

Author

Listed:
  • Aurelian Simionescu

    (University of Petroşani, Romania)

  • Florian Buşe

    (University of Petroşani, Romania)

  • Petru Hodor

    (University of Petroşani, Romania)

  • Sorin Mangu

    (University of Petroşani, Romania)

Abstract

In the feasibility studies, which were made in Romania for all mine properties at mining field level, when investment statement year by year was made, we had to approach the problem of assessing certain values Duchene refers to as "Depenses anterieurs capitalises" and Raymond refers to "Approximate value of mineral property". The application of the assessment principle for the mining patrimony as a whole, or for part of it, and of the patrimonial model as it was recommended by Raffegeau has proved unacceptable. The most important part of mining patrimonies which represent sunk costs, in case of cessation of mining activity, possibly has only a potential utility value by flux as a whole, and function of the remaining ore reserves. In the paper we demonstrate that such a value can be established by treating the problem of continuing (possibly with rehabilitation) the mining activity or closing the mine as a "replacement problem", and applying to this effect, in an adapted form, the theory of assets replacement

Suggested Citation

  • Aurelian Simionescu & Florian Buşe & Petru Hodor & Sorin Mangu, 2002. "On the valuation of coal property," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 2, pages 180-189.
    • Handle: RePEc:pet:annals:v:2:y:2002:p:180-189
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    Cited by:

    1. Sorin-Iuliu Mangu, 2009. "The Potential Value of a Mining Property," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 9(4), pages 55-62.
    2. Hansen, T.A., 2022. "Stranded assets and reduced profits: Analyzing the economic underpinnings of the fossil fuel industry's resistance to climate stabilization," Renewable and Sustainable Energy Reviews, Elsevier, vol. 158(C).

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