Comparison of Cost Structures at Selected US and Colombian Coal Mines*

Abstract

This paper summarizes a study designed to measure the differences in production costs at certain US and Colombian coal mines and to identify those factors, including mine health, safety and environmental requirements, which account for the difference. Meaningful cost‐structure comparisons required that mines with similar geology, techniques and sizes be evaluated in each country. Standard engineering estimating techniques were used to develop costs at three roughly matched pairs of mines, one from each country. Tax and labour cost differences were found to be more important factors than regulatory differences in the cost advantage of the Colombian mines in each set.