According to Free Malaysia Today's headline: 'Tin not worth mining, says Khir'
Each time I took some foreign visitors to visit this abandoned tin dredge, I marveled at the huge size of the buckets used to scoop alluvia from the pond to extract tin, many years ago. I used to wonder how much the demand of tin must have been, to warrant such huge capital expenditure! Of course, without research, I am unable to provide figures as to the costs of an average tin dredge in relation to the price of tin then. But I can remember Steven telling me that the scrap value of the dredge at today's iron ore price is well over Rm1 million!
I am amused to read Khir Toyo's claim that tin is not worth mining and that sand mining is more profitable. Of course, if there were insufficient tin deposits to make it economical, then it is the end of the argument. But his simple dismissal of the claim that he was against sand mining because of possible tin deposits should warrant some response because at today's prices, tin mining can be profitable, depending on the amount of deposits. Like any venture, there are risks involved.
Amang factories have been in operation for many years, mainly for the purpose of extracting the little tin left behind after tin dredging or open cast mining. Tin tailings used to be bought from mines for extraction of tin. It was only later, when there were sudden demands for rare minerals that some operators switched their attention, especially during the periods when tin was at its lowest price which made tin mining uneconomical.
After processing at the amang factories, the average percentage of tin ore is around 65% when sold to smelters which further purified it to make tin ingots which are almost 100% pure.
A 7-ton lorry load of tin ore (65%) at today's price of US$17,800 per tonne (at exchange rate of 3.237) works out to Rm262,164.
As a comparison, based on a recent report on illegal export of sand, a barge carrying 5,000 tons of sand was valued at Rm250,000, which works out to an average of Rm50 per ton. Assuming a 7-ton lorry load of sand, it is worth Rm350 only. In other words, a lorry load of processed tin ore is equivalent in value, to 750 lorries loaded with sand!
Of course, I am not comparing like with like. But I am highlighting the value of tin ore at today's price which would make amang factory operators salivating if those so-called sand were actually carrying tin deposits of say 5%.
A barge of 5,000 tons of tin tailings (5% tin) can extract 250 tons of tin ore. At 65% purity, it is worth Rm9,363,022 (162.50 x 17,800 x 3.237)! Even after taking into account the costs of processing, it is obvious which is more profitable, isn't it?
Note: With further information, my above example (5% tin) would involve additional approval required from Mines Department. It seems tin tailings are considered worth processing with 1.5% tin content, without involving Mines Department. Even with this small percentage, just the tin alone could add >Rm3,000,000 to the 5,000 tons of sand, assuming the remaining 98.5% being sold as such. My contention was that someone could have secretly taken a sample of the sand and the percentage, assuming 5% tin would have brought him extra millions in Ringgit under the pretext of buying sand or doing sand mining. It is also to disprove Khir's sweeping statement that tin is not worth mining.
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