Rare Element Resources
Bear Lodge Project
Canadian NI 43-101 Technical Report
October 9
th
, 2014
100135-200-46 – Rev. 0
21-4
o
Year -1 Mine Operating Costs – 5% of sub-consultant direct costs;
o
Contractors Pre-Strip Costs - 5% of sub-consultant direct costs;
Procurement and Construction Management – 7% of total direct costs (excluding
mining equipment);
Temporary site facilities – 3% of sub-consultant direct costs;
Commissioning and start-up – 3% of direct purchase cost;
Spare Parts - 5% of sub-consultant direct costs;
Others;
o
First fills – $400,000.
o
Capital Replacement Spares - 5% of sub-consultant direct costs;
Taxes and duties– excluded.
Access Roads Environmental Impact & Permitting - $100,000
Contractor Profit/Overhead/Mobilization/Demobilization - 10% of sub-consultant
direct costs.
21.1.2.2 Owner’s Indirect Costs
The owner’s indirect cost has been supplied by Rare Element and is estimated as follows:
Capital spares for major equipment – 2% of direct purchase cost
21.1.2.3 Contingencies
Project contingency is calculated as a percentage of the direct and indirect costs. The
contingency is varied for each item to account for unknowns at the time of the study. The
contingencies are removed from the consultants’ cost estimates to prevent adding multiple
layers of contingencies. The following levels of contingency have been used for this
study:
PUG and Hydromet – 25% of direct and indirect cost;
Access Roads – 20% of direct and indirect cost;
Power Lines – 13% of direct and indirect cost;
Mining Equipment and Mining Infrastructure – 5% of direct and indirect cost;
Tailings Storage Facilities – 25% of direct and indirect cost;
