Is the Mineral Resource Grade Estimate Realistic?

The grade of mineral resource estimates underpin all major economic considerations of mining prospects. While there are reporting requirements to satisfy when stating a mineral resource estimate, an examination of NI 43-101 style reports suggests that authors believe that there are a number of ways of addressing these requirements. As a reader of these reports, some processes are helpful and others are not so in getting a real appreciation of how realistic is the mineral resource estimate. Critical to the quality of the mineral resource estimate is how realistic is the economic mineral concentration component. In many cases, this parameter is called grade. The industry experiences increased difficulty in achieving realistic grade estimates as the sample grade variability increases. The level of transparency in a mineral resource estimate is very much a function of the competence of the author. An objective presentation of the critical data, such as grade sampling variability can assist a reader in determining if the geology of the mineral concentration is adequately understood and how realistic is mineral resource grade estimate. This paper has considered 75 NI 43-101 style reports released in the past 2 years. The review demonstrates features that were helpful in determining how realistic the mineral resource grade estimate is. If there is insufficient transparency in a report, there is a high probability that the mineral resource grade estimate will not be realistic.