SAQA All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.
SOUTH AFRICAN QUALIFICATIONS AUTHORITY 
REGISTERED UNIT STANDARD THAT HAS PASSED THE END DATE: 

Demonstrate knowledge of basic mining economics 
SAQA US ID UNIT STANDARD TITLE
336904  Demonstrate knowledge of basic mining economics 
ORIGINATOR
Task Team - Fabrication and Extraction 
PRIMARY OR DELEGATED QUALITY ASSURANCE FUNCTIONARY
-  
FIELD SUBFIELD
Field 06 - Manufacturing, Engineering and Technology Fabrication and Extraction 
ABET BAND UNIT STANDARD TYPE PRE-2009 NQF LEVEL NQF LEVEL CREDITS
Undefined  Regular  Level 4  NQF Level 04  4 
REGISTRATION STATUS REGISTRATION START DATE REGISTRATION END DATE SAQA DECISION NUMBER
Passed the End Date -
Status was "Reregistered" 		 2018-07-01  2023-06-30  SAQA 06120/18 
LAST DATE FOR ENROLMENT LAST DATE FOR ACHIEVEMENT
2024-06-30   2027-06-30  

In all of the tables in this document, both the pre-2009 NQF Level and the NQF Level is shown. In the text (purpose statements, qualification rules, etc), any references to NQF Levels are to the pre-2009 levels unless specifically stated otherwise.  

This unit standard does not replace any other unit standard and is not replaced by any other unit standard. 

PURPOSE OF THE UNIT STANDARD 
This Unit Standard will be useful to people in a supervisory role in underground mines, surface mines/quarries and small-scale mines.

People credited with this Unit Standard are able to:
  • Explain expenditure in terms of developing and operating a mine/quarry.
  • Understand revenue/income in terms of sale of products.
  • Differentiate between turnover, profit and loss.
  • Understand the purpose of budgets.
  • Explain the breakdown and percentage split of the main working cost elements used in an operation. 
    		•

    LEARNING ASSUMED TO BE IN PLACE AND RECOGNITION OF PRIOR LEARNING 
    It is assumed that learners are competent in the following:
  • Communication and Mathematical Literacy at NQF Level 3. 
    		•

    UNIT STANDARD RANGE 
    N/A 

    Specific Outcomes and Assessment Criteria: 

    SPECIFIC OUTCOME 1 
    Explain expenditure in terms of developing and operating a mine/quarry. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    The concept of investment capital is explained in terms of mining economics. 
    ASSESSMENT CRITERION RANGE 
    Concept of investment capital includes but not limited to:
  • Primary access (shafts/development/ramps).
  • Start up mining equipment.
  • Beneficiation plants.
  • Mine infrastructure (offices, workshops etc).
  • Employee housing and accommodation.
  • General administration and management services.
  • Energy reticulation (electricity, water and compressed air).
     
    		•

    ASSESSMENT CRITERION 2 
    The concept of working (replacement) capital is explained in terms of mining economics. 
    ASSESSMENT CRITERION RANGE 
    Concept of working capital includes but not limited to:
  • Replacement of mining equipment.
  • Replacement of mining infrastructure.
  • Equipment to enhance mining productivity (new technology).
     
    		•

    ASSESSMENT CRITERION 3 
    The concept of working cost is explained in terms of mining economics. 
    ASSESSMENT CRITERION RANGE 
    Concept of working cost includes but not limited to:
  • A breakdown of what makes up the main cost elements.
  • The percentage split of each of these cost elements.
  • Contributing factors which can reduce costs in each of these cost elements.
     
    		•

    SPECIFIC OUTCOME 2 
    Demonstrate knowledge and understanding of revenue (income) in terms of sale of products. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    Sources of income are identified and described for a typical mining operation. 

    ASSESSMENT CRITERION 2 
    The relation between product price and number of units is explained in relation to revenue generation. 

    ASSESSMENT CRITERION 3 
    Calculations to determine revenue are made for the different sources of income. 

    ASSESSMENT CRITERION 4 
    The concept of operating profit is explained in the context of mining economics. 

    ASSESSMENT CRITERION 5 
    Calculations to determine profit on sale of products are made in the context of mining economics. 

    SPECIFIC OUTCOME 3 
    Explain the elements within an income statement. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    The meaning of turnover, profit and loss is explained for the specific mine. 

    ASSESSMENT CRITERION 2 
    The different elements reflected in an income statement are explained within the context of the mine. 

    ASSESSMENT CRITERION 3 
    The reasons and purpose of cost analysis is explained in terms of management control, forecasting and planning. 

    ASSESSMENT CRITERION 4 
    Factors influencing profit margins for different products are identified and recommendations made in order to increase profit margins on the mine. 

    ASSESSMENT CRITERION 5 
    The reasons for maximising profit margins are explained in the context of mining economics. 

    ASSESSMENT CRITERION 6 
    The consequences of small profit/loss margins on a mine are explained in terms of viability. 

    ASSESSMENT CRITERION 7 
    Profit distribution in a company is explained by way of a simplified diagrammatical representation of the flow of funds. 
    ASSESSMENT CRITERION RANGE 
    Range must include:
  • Obtaining funds in the financial market.
  • Sale of products and operating profit.
  • Interest paid to financiers.
  • Taxable profit and tax leverage.
  • Distribution of profit: Shareholder dividends retained profit for capital reserves advantages and disadvantages.
     
    		•

    SPECIFIC OUTCOME 4 
    Explain the purpose of a budget. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    The need for a 12-month budget (financial year) and how these are compiled is explained in the context of the mine. 

    ASSESSMENT CRITERION 2 
    The need to establish various cost centres and their co-ordination in achieving the overall company objectives is explained in the context of the mine. 

    ASSESSMENT CRITERION 3 
    The reasons for budget control and corrective actions are explained in the mining context. 

    ASSESSMENT CRITERION 4 
    The stores requisition process and procedures for ordering stores, materials and equipment is explained in the context of the mine. 

    ASSESSMENT CRITERION 5 
    Consumable items to support the production process are identified and quantified for the next production month. 

    ASSESSMENT CRITERION 6 
    The impact of Inflation is explained in terms of the profitability of the mine. 

    ASSESSMENT CRITERION 7 
    The impact of cost squeeze on the mine is explained in terms of inflation. 

    ASSESSMENT CRITERION 8 
    The effects of costs are explained in terms of the life of operation of the mine. 

    ASSESSMENT CRITERION 9 
    The impact of non adherence of cost controls for Production Supervisors are explained in the context of the mine. 

    SPECIFIC OUTCOME 5 
    Explain the breakdown and percentage split of the main working cost elements for an operating mine/quarry. 

    ASSESSMENT CRITERIA     

    ASSESSMENT CRITERION 1 
    The costs related to labour are explained in the context of the mine. 
    ASSESSMENT CRITERION RANGE 
    Costs related to labour include but not limited to:
  • Basic salaries and wages.
  • Production incentive bonuses.
  • Leave pay/bonus.
  • Provident/Death Benefit Schemes.
  • Accident Insurance.
  • Compensation.
  • Medical Aid.
  • Unemployment insurance.
  • Absenteeism.
     
    		•

    ASSESSMENT CRITERION 2 
    Costs relating to mining stores, materials and equipment are discussed in the context of the mine. 
    ASSESSMENT CRITERION RANGE 
    Costs relating to stores, materials and equipment include but not limited to:
  • Drilling.
  • Blasting (explosives and explosive accessories).
  • Cleaning.
  • Support.
  • Material and Equipment.
  • Consumables (stores, PPE etc).
     
    		•

    ASSESSMENT CRITERION 3 
    Cost relating to engineering stores, materials and equipment are explained in the context of the mine. 

    ASSESSMENT CRITERION 4 
    Costs of services are explained in the context of the mine. 
    ASSESSMENT CRITERION RANGE 
    Costs of service include but not limited to:
  • Electricity.
  • Water (drinking, service and pumping).
  • Compressed air.
  • Ventilation (Fans and plant).
  • Handling rock, men and material (hoisting, conveyor belts, tramming and hauling).
     
    		•


    UNIT STANDARD ACCREDITATION AND MODERATION OPTIONS 
  • Anyone assessing a learner or moderating the assessment of a learner against this Unit Standard must be registered as an assessor with the relevant Education, Training, Quality, Assurance (ETQA) Body, or with an ETQA that has a Memorandum of Understanding with the relevant ETQA.
  • Any institution offering learning that will enable the achievement of this Unit Standard must be accredited as a provider with the relevant Education, Training, Quality, Assurance (ETQA) Body, or with an ETQA that has a Memorandum of Understanding with the relevant ETQA.
  • Assessment and moderation of assessment will be overseen by the relevant Education, Training, Quality, Assurance (ETQA) Body, or by an ETQA that has a Memorandum of Understanding with the relevant ETQA, according to the ETQA's policies and guidelines for assessment and moderation.
  • Moderation must include both internal and external moderation of assessments, unless ETQA policies specify otherwise.
  • Anyone wishing to be assessed against this Unit Standard may apply to be assessed by any assessment agency, assessor or provider institution that is accredited by the relevant ETQA. 
    		•

    UNIT STANDARD ESSENTIAL EMBEDDED KNOWLEDGE 
    The following embedded knowledge is addressed in an integrated way in the Unit Standard
  • Expenditure in terms of developing and operating a mine/quarry.
  • Revenue/income derived from sale of products.
  • Turnover, profit and loss.
  • Budgets and cost reports.
  • Percentage split of the main working cost elements. 
    		•

    UNIT STANDARD DEVELOPMENTAL OUTCOME 
    N/A 

    UNIT STANDARD LINKAGES 
    N/A 


    Critical Cross-field Outcomes (CCFO): 

    UNIT STANDARD CCFO COLLECTING 
    Collect, analyse, organise and critically evaluate information.
    Note: The ability of the learner to reconcile the information from relevant documents such as budgets, cost reports and requisitions. 

    UNIT STANDARD CCFO COMMUNICATING 
    Communicate effectively, using visual, mathematical and/or language skills in the modes of oral and/or written presentations.
    Note: The learner is able to discuss aspects relating to basic mining economics with peers and subordinates. 

    UNIT STANDARD CCFO DEMONSTRATING 
    Demonstrate an understanding of the world as a set of related systems by recognising that problem-solving contexts do not exist in isolation.
    Note: The learner understands the importance of aspects of basic mine economics which impact on operations. 

    UNIT STANDARD ASSESSOR CRITERIA 
    N/A 

    REREGISTRATION HISTORY 
    As per the SAQA Board decision/s at that time, this unit standard was Reregistered in 2012; 2015. 

    UNIT STANDARD NOTES 
    N/A 

    QUALIFICATIONS UTILISING THIS UNIT STANDARD: 
      ID QUALIFICATION TITLE PRE-2009 NQF LEVEL NQF LEVEL STATUS END DATE PRIMARY OR DELEGATED QA FUNCTIONARY
    Core  74490   Further Education and Training Certificate: Mining Operations  Level 4  NQF Level 04  Passed the End Date -
    Status was "Reregistered"     		 2023-06-30  MQA 


    PROVIDERS CURRENTLY ACCREDITED TO OFFER THIS UNIT STANDARD: 
    This information shows the current accreditations (i.e. those not past their accreditation end dates), and is the most complete record available to SAQA as of today. Some Primary or Delegated Quality Assurance Functionaries have a lag in their recording systems for provider accreditation, in turn leading to a lag in notifying SAQA of all the providers that they have accredited to offer qualifications and unit standards, as well as any extensions to accreditation end dates. The relevant Primary or Delegated Quality Assurance Functionary should be notified if a record appears to be missing from here.
     
    NONE 


    All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.