EDITORIAL & OPINION – COMMENTARY — Resource estimation and geological constraints, Part 2

Without a doubt, the most important step in deposit resource estimation is formulating a well-constrained geological model for the orebody, its shape and the structure and stratigraphy that controls it. This model serves as the backbone of the resource calculation, and it is the integrity of the resource estimate that ensures the choice of mining method, production rates and processing methods. The projections of cash-flow have integrity too.

When a resource model is not sufficiently constrained by geometrical and geological knowledge, there may be an excess of averaging between the higher and lower grade zones of the deposit. This can yield a higher-tonnage, lower-grade resource estimate and a less accurate picture of the distribution of mineralization than can a model with better geological control.

Taking an epithermal-style deposit as an example, and using the methodology we advocate, the first and most critical step in a resource calculation is to determine the geological features that control the mineralization. Is the mineralization localized along fault zones? Does it occur with silicification? Does density of veining or fracturing provide a good indication of metal tenor? Is hydrothermal brecciation important? Does host rock lithology play a role in localizing mineralization? Can solid boundaries be drawn around mineralized or potentially mineralized bodies?

Once the essential geological criteria that are associated with mineralization have been established, they form the basis for defining “geologically constrained” bodies of mineralization. The information that reveals the boundaries of these zones generally comes from surface data extrapolated downdip and along strike, correlated with information from the drill logs. All of the assay results that intersect these corridors of mineralization potential go into the calculation that estimates the grade of the zone.

The accurate construction of geologically constrained zones of mineralization is extremely important for subsequent geostatistical analyses. These zones make it possible to domain the assay population and gain an understanding of the “real” metal distribution within a mineralized zone. A positive consequence of determining accurate metal distributions is the delineation of “deposits within a deposit.” Conversely, discrete high-grade deposits can easily be masked within low-grade bulk-tonnage disseminated deposits if an inappropriate geological model is applied. It must be stressed, therefore, that, in the absence of geologically constrained zones of mineralization, geostatistical techniques can produce unreliable and unpredictable results.

Mineralized envelopes are not delineated by down hole assay data. They do not come from using an arbitrary cutoff grade, and they do not introduce a statistical bias to either low-grade or high-grade assays. Instead, the correct technique is based on identifying the fundamental features that host mineralization, and determining the subset of the data that comes from inside the boundaries of those features. This approach can be applied to the entire spectrum of hydrothermal mineral deposits, from porphyry coppers to volcanogenic massive sulphides.

The largest potential error in any resource model is in the way geological boundaries are linked from one drill hole to the next. Geological acumen and a firm understanding of the property geology are the most valuable assets in any resource estimation. No one can overemphasize how important it is to integrate surface mapping and accurate core logging data into the resource model. Without a robust geological model, resource estimates will seldom be reliable; in fact, their results can be detrimental, generating a false sense of confidence and hurting the investor. Resource estimation integrates the geologist, who understands the deposit; the mining engineer, who evaluates minability; and the geostatistician, who crunches the numbers. We cannot leave it just to the academics.

— The authors are senior geologists with the mining and exploration division of Vancouver-based SRK Consulting Canada. They specialize in assessing the controls on mineralization and resource modeling for feasibility studies.