Spotlight on ASA’s Advanced Mining Valuation Virtual Class

In light of ASA’s upcoming Advanced Mining Valuation virtual class on 9/25-27, we interviewed one of the most experienced, top leaders in the field, Charles W. (Bill) Ruth, ASA. During this class, Bill will provide students with information on current estimates of capital mining equipment costs, discuss how to identify various pieces of mining equipment processes and components, communicate the requirements of an appraisal, and teach students how to assess the scope of work and qualifications needed to perform a mining appraisal assignment. 

ASA sat down with instructor Charles W. “Bill” Ruth, ASA for a Q&A to discuss this unique class.

Q: What was the most recent economic state of the mining equipment industry just prior to COVID-19?

A: The new year brought with it a new sense of investor optimism and purpose. Global equities were trading well, fixed asset investment was moving in the right direction. This optimism proved steady in the early stages of the COVID-19 as the virus spread. In the past months, this optimism has proven to be misplaced. COVID-19 has created more pervasive economic disruption through curtailing movement of workers, consumers, and goods and services.

Q: How has the pandemic impacted this sector and the appraisers who specialize in this area?

A: Earnings for most basic materials have been showing a decline. Some mining operations have reduced their work force, to provide more safety for their employees. The mining community, for the most part have been reducing operational expense, paying down debt, and eliminating nor-core assets to concentrate on their highest ore-grade assets.  The mining appraiser needs to know the potential impact on future life of the operation if scheduled maintenance protocols have been converted to “run till failure” protocol.  If capitol assets, such as haul trucks, shovels, and other larger equipment that were scheduled to be replaced may now be rebuilt.

Q: What important drivers do you see impacting this field in the next 6-12 months?

A: If and when a vaccine is developed and widely distributed, I think the world mining operations will feel more optimistic. Metal stock piles should be going down, and the commodity prices will rise as the world economy rebounds. The problem is the uncertainty of when that will happen.

Q: What are professional development opportunities, like ASA’s Advanced Mining Valuation class important?

A: ASA’s advanced courses, which there are many, provide the appraiser with new information on the subject taught that the student may not have thought about before. It is an opportunity for the student to discuss the topic of study, which may be new to them, with other appraiser that may have an extensive knowledge of the subject, thus establishing a network of other professionals to draw from during their practice.

Q: Which professionals would benefit best from attending such?

A: The professionals that I think would benefit from this course are appraisers that may want to get into mining appraising, financial personal that review appraisals of mining operations / equipment to perhaps ask additional questions about the scope of work of the appraisal of the operation or equipment.

To register or to learn more about ASA’s Advanced Mining Valuation class, visit www.appraisers.org or call (800) 272-8258.

Charles W. (Bill) Ruth, ASA, Machinery & Equipment retired from Phelps Dodge Corporation / Freeport McMoRan Copper & Gold on January 30, 2009, after being employed for 38 years. His appraisal activity has, for the most part, been as an in-house appraiser of mining equipment and process plants for the company. The focus has been primarily in the southwestern United States at sites in Arizona, New Mexico, Texas and Colorado with additional assignments in Mexico and South America.

Bill began appraising machinery and equipment for Phelps Dodge in 1988, and specialized in the appraisal of mining equipment and material processes for both open pit and underground operations. He completed appraisal assignments for a variety of departments within the company, including Resource Management (process plants & equipment), Global Supply Chain (asset recovery, liquidation and transfers of machinery & equipment and other capital assets,) Risk Management (insurance values), Land & Water (ranches & water rights), Corporate Finance (lease options, residual values at end of mine life, values for bond issues).