Essential Steps to Modeling

Before presenting each of the above methodologies, it is important to understand the steps essential for mineral and energy modeling. Developing and applying a mineral or energy model normally requires the same “tool kit” that is used for constructing a typical commodity model, i.e. see Labys (1973, 1975) and Labys and Pollak (1984). Such a model consists of a number of components which reflect various aspects of demand, supply, trade and price determination. Each of these components, in turn, embody basic theories of economic behavior and/or transformation processes. What gives a mineral or energy model its particular configuration is the kind of market system it attempts to emulate. There is no such thing as an allpurpose commodity model. Each model must describe aspects of mineral or energy behavior which are peculiar to the system of interest.