Abstract
	Economic geology and mineral economics encompass a variety of activities. One important aspect of these disciplines is the identification and evaluation of mineral deposits. Part of this work is largely technical in nature. Explorations, for example, use the tools of geology, geochemistry, geophysics, and other fields to identify mineral deposits. They then study the deposits to determine if they exhibit the physical and chemical characteristics typical of similar deposits that have been developed into mines: and, in the case of a new type of deposit, to draw inferences on the basis of new scientific knowledge. Economics engineers and others work together to evaluate a mineral deposit's economic potential by comparing the expected revenues from mine production associated expected cost of further exploration, development, and production. It is their task to determine if the expected revenues from developing a deposit will be sufficiently in excess of cost to provide investors with an adequate return on their investment. 
	The general procedure for evaluating investment opportunities is to compare benefits of any particular opportunity with the associated costs, and then to invest in those projects that are worth than they cost. But what factors should be included when estimating benefits and costs? And how should exploration and development costs incurred in the early years of the typical mineral project be compared with the benefits of mineral production that are received in later years and are, furthermore, uncertain? The answers to these questions vary considerably depending on the context. What follows are the principles of investment analysis for private and public organisations, providing a foundation for the more specialised, subsequent discussions of the economic evaluation of exploration projects and mineral deposits. 
	For both private and public organisations active in mineral development, investment analysis starts with estimating the amount of money to be spent on exploration, development, operations, taxes, and others items and activities; and the amount to be received as revenues from mineral production. These amounts of money are referred to as cash flow. 
	Organisations in the private sector, as noted earlier, generally strive maximise profits, the difference between revenues and costs. To do so, organisations invest in those activities that have expected revenues in excess of costs. But it would be incorrect to directly compare the costs incurred early in the life of a project with revenues received only later. Cash flows must be adjusted for the time value of money. Money has a time value because a dollar received today is more than a dollar received tomorrow: at the very least, today's dollar can earn the going rate of interest a savings account, and more generally it can grow in value trough other types of investment. In other words, financial capital (money) is a productive resource. Investors demand to be compensated for accepting payment tomorrow rather than today. Therefore, the value of future cash flows must be discounted before being compared with current costs and revenues.