Development of an Economic Cost Model for Gold and Associated Minerals Using Economic Analysis and Artificial Intelligence Approach

  • Musiliu A. Gbolagade Federal University of Technology Akure
Keywords: gold, Nigeria, Mining industry, cost based model, Artificial intelligence


Limited accuracy due to complex geological processes, insufficient data granularity, and challenges in predicting market dynamics impact mineral forecast models. In order to develop a cost-based model for gold and related minerals in Birnin Gwari (Kaduna State) and Kagara (Niger State), this study is being carried out in Nigeria. The created concept aims to increase the profitability and economic viability of open-pit mines operated by craftsmen and mining investors. By maximizing mine life cycles and preventing the early closure of mining sites, this was intended to encourage the best recovery rates. This study used economic and artificial neural network (ANN) modeling methods to create a cost-based model for ten gold-associated minerals. The coefficient of correlation (R2), root mean square error (RSME), and variance accounting factor (VAF) were used to assess the created model's correctness. The model evaluator demonstrates that the proposed cost-based models are economically viable and the quantitative results are as presented in Equations (14-23). The cost-benefit connection between gold and the ten related minerals was also determined using a least-squares regression analysis. According to geochemical results, the average values of gold and related minerals in the study region range from 4.87 g/t of gold (Au), 1.501 g/t of copper (Cu), and 187.13 g/t of iron (Fe) in Birni Gwari to 2.29 g/t of gold (Au), 1.358 g/t of copper (Cu), and 173.75 g/t of iron (Fe) in Kagara. In Birnin Gwari, the equivalent financial estimations are N876,600 for Au, N60,040,000 for Cu, and N1,129,375 for Fe, and N5,780,000 for Au, N49,500 for Cu, and N363,060,000 for Fe in Kagara. The model's scope demonstrates that running a single mineral can result in low recovery rates and a loss of profit margin; thus, the model's application to all open pit mines is relevant as  reference for profit margin cash flow.


Abdulkareem, J. H., Abdulkadir, A. and Abdu, N. (2015): Vertical distribution of lead (Pb) in farmlands around contaminated gold-mine in Zamfara state, Northern Nigeria. African Journal of Agricultural Research, 10 (53): 4975 - 4989.

Adesida, P. A., Gbolagade, M. A. and Opafunso Z. O. (2017). Effect of Capital and Operating Cost on the Aggregate Production in Some Selected Quarries in North-Central Nigeria, British Journal of Applied Science and Technology.

Alaba, O.C (2017). Environmental Assessment and Remedial Evaluation Options for Lead Contaminated Sites from Artisanal Gold Mining in Zamfara State, Nigeria, Ph.D. Dissertation. Federal University of Technology, Akure, Nigeria, 1-273.

Ako, T., Onoduku, U., Oke, S., Adamu, I., Ali, S., Mamodu, A. and Ibrahim, A. (2014): Environmental Impact of Artisanal and gold Mining in Luku, Minna, Niger State, North Central Nigeria. Journal of Geoscience and Geomat, 2(1):28.

Azubike, O.C. (2011). Update on the Lead Poisoning Incident in Zamfara State Nigeria. Paper Presented at the Regional Multi-Stakeholders Workshop, Anglophone West Africa, Sub-Regional Action Planning for Mercury use in Artisanal and Small- Scale Gold Mining, 12 – 14.

Barry, M.S. and Xinwu, H. (2020). A Critical Analysis of Gold Prospecting Methods. International Journal of Geosciences, 11(02): 15-24.

Buba, F.N and Aboyeji, O.S. (2015). Geospatial Analysis of Lead Concentration in the Soil of Anka, Zamfara State, Nigeria. Greener Journal of Environmental Management and Public Safety, 4(3): 28-36. Camm, T. W. (1989): Mine and Mill Models for the Juneau Mining District, 41p.

Du, B., Wang, Z., Santosh, M., Shen, Y., Liu, S., Liu, J., ... and Deng, J. (2023). Role of metasomatized mantle lithosphere in the formation of giant lode gold deposits: Insights from sulfur isotope and geochemistry of sulfides. Geoscience Frontiers,14(5), 101587.

Gbolagade, M. A., Melodi, M. M., Amigun, J. O., and Alaba, O. C. (2023). Prediction of Gold associated Mineral worth: An application of mathematically driven artificial neural network technique. International Journal of Engineering and Advanced Technology Studies, 11(1), 19-36.

Garba, I. (2000). Origin of Pan-African Mesothermal Gold Mineralization at Bin Yauri, Nigeria, Journal of African Earth Sciences, 3: 433 – 449

Gibbs, R. J. (1965). Error due to segregation in quantitative clay mineral X-ray diffraction mounting techniques. American Mineralogist: Journal of Earth and Planetary Materials, 50(5-6), 741-751.

Lalomov, A. V., Chefranov, R. M., Naumov, V. A., Naumova, O. B., LeBarge, W., and Dilly, R. A. (2017). Typomorphic features of placer gold of Vagran cluster (the Northern Urals) and search indicators for primary bedrock gold deposits. Ore Geology Reviews, 85, 321-335.

Lane, G.R., Hudson J.H.K., and Bondi E. (2006). Implementation of an Economic Model at Gold Fields Limited. The Journal of The Southern African Institute of Mining and Metallurgy December 2006, 106.

Manohar, J. M., and Guntur, A. R. (2021). An Assessment of Gold as a Hedge or Safe Haven: Evidence from Major Gold Producing Countries. Asian Economic and Financial Review, 11(7), 524.

Masasire, A., Rwere, F., Dzomba, P., and Mupa, M. (2022). A new preconcentration technique for the determination of PGMs and gold by fire assay and ICP-OES. Journal of the Southern African Institute of Mining and Metallurgy, 122(1), 29-36.

Melodi, M.M and Ganiyu, W. A. (2019). Socio-Economic Assessment and Profitability of Artisanal Gold Miners in Niger State, Nigeria. “Journal of Engineering Technology” Volume 4 N2, Pp 48-51.

Melodi, M. M., Gbolagade, M. A., Amigun, J. O., and Alaba, O. C. (2023). Statistical Investigation of the Relationship between Gold and Associate Minerals: A case Study of Kagara Area of Niger State Nigeria Soil. International Journal of Engineering and Advanced Technology Studies, 11(1), 1-18.

Meyer, F. M. (2023). Case Histories of Orogenic Gold Deposits. Minerals, 13(3), 369. Obaje, N. G. (2009). Geology and Mineral Resources of Nigeria. 120. Springer, 2009.

Onwe, O. J. (2013). Role of the informal sector in development of the Nigerian economy: Output and employment approach. Journal of Economics and Development studies, 1(1), 60-74.

Ousman, G., and Mouna, B. D. (2015). Economies of Scale in Gold Mining. The Working Paper Series (WPS) is produced by the Development Research Department of the African Development Bank. Working Papers are available online at http:/

Taiwo, B. O., Angesom, G., Fissha, Y., Kide, Y., Li, E., Haile, K., and Oni, O. A. (2023). Artificial neural

network modeling as an approach to Limestone blast production rate prediction: A comparison of PI-BANN, and MVR models. Journal of Mining and Environment.

Taiwo, B. O., and Adebayo, B. (2023). Improvement of Blast-induced Fragmentation Using Artificial Neural

Network and BlastFrag© Optimizer Software. Materials and Geoenvironment, 69(1), 1-13.

Taiwo, B. O., Ajibona, A. I., Idowu, K., Babatunde, A. S., and Ogunyemi, B. O. (2023). Improvement of small scale mine blast operation: A comparative application of hunter-point artificial neural network, support vector machine, and regression analysis models. International Journal of Mining and Geo- Engineering, 57(2), 205-213.

Taiwo, B. O. (2022). Improvement of small-scale dolomite blasting productivity: comparison of existing empirical models with image analysis software and artificial neural network models. Journal of Mining and Environment, 13(3), 627-641.

Taiwo, B. O., and Adebayo, B. (2023). Improvement of Blast-induced Fragmentation Using Artificial Neural Network and BlastFrag© Optimizer Software. Materials and Geoenvironment, 69(1), 1-13.

Taiwo, B. O., Shahani, N. M., Omosebi, A., Samson, O. B., and Akinlabi, A. A. (2024). Development of mathematically motivated artificial intelligence models for the prediction of carbonate rock lime saturation factor for cement production. Engineering Applications of Artificial Intelligence, 127, 107444.

Tirima, S., Bartrem, C., von Lindern, I., von Braun, M., Lind, D., Anka, S.M., Abdullahi, A. (2016). Environmental Remediation to Address Childhood Lead Poisoning Epidemic due to Artisanal Gold Mining in Zamfara, Nigeria. Environ Health Percept, 124(9): 1471