calminer-docs/requirements/FR-011.md

Functional Requirement FR-011: Basic Profitability Calculation

Description

The system shall provide functionality to perform basic profitability calculations for ore mining products based on user-defined input parameters.

A detailed specification is available in specifications/price_calculation.md

Rationale

Profitability calculations are essential for mining companies to assess the financial viability of their operations. By enabling users to input key parameters and receive profitability metrics, the system will support informed decision-making and strategic planning.

Acceptance Criteria

1. Input Parameters: The system shall accept the following input parameters:
   • Metal type (e.g., copper, gold, lithium)
   • Ore tonnage processed
   • Head grade (%)
   • Recovery rate (%)
   • Treatment charge (currency/tonne)
   • Smelting charge (currency/tonne)
   • Moisture content (%)
   • Impurity content (ppm for relevant impurities)
   • Moisture penalty factor (currency/%)
   • Impurity penalty factor (currency/ppm)
   • Premiums/credits (currency)
   • FX rate (currency conversion rate)
2. Calculation Logic: The system shall implement the profitability calculation logic as specified in the detailed specification document, including:
   • Calculation of metal content based on ore tonnage, head grade, and recovery rate.
   • Computation of gross revenue using metal content and reference prices.
   • Deduction of treatment and smelting charges.
   • Application of moisture and impurity penalties.
   • Adjustment for premiums/credits.
   • Conversion of final revenue to scenario currency using the FX rate.
3. Output Metrics: The system shall provide the following output metrics:
   • Gross revenue (in scenario currency)
   • Total charges (treatment and smelting)
   • Total penalties (moisture and impurities)
   • Net revenue before premiums
   • Final adjusted revenue (after premiums/credits)

Dependencies

• Accurate and up-to-date reference prices for supported metals.
• User interface components for inputting parameters and displaying results.
• Data validation mechanisms to ensure input parameters are within acceptable ranges.
• Integration with existing scenario management and reporting modules for seamless user experience.

Notes

• The system should allow for easy updates to reference prices and other key parameters as market conditions change.
• User training and documentation will be essential to ensure effective use of the profitability calculation features.
• Future enhancements may include sensitivity analysis and scenario comparisons based on profitability metrics.