letters to the Editor Not all geologists party to `scandals’

Although the direction in which the finger points in not inappropriate, three fingers always point back. There has been scandalous behavior by too many people involved with flow-through financing.

But it’s not my purpose to discuss scandals. Much of this was the product of “tax driven” minds with little exploration sense. In my opinion, a degree of “technical fraud” developed among some geoscientists, who allowed themselves to be seduced by proportionate management fee schemes, and others who felt more BQ drilling would substitute for bulk sampling. Geologists are among the guilty, but not all geologists are guilty.

Most discoveries are the result of hard work, not serendipity. Often the hard work is in developing and honing “perspective.” Perspective is not prescience — it’s a skill.

The key decision in project development is applying this perception. One looks to old exploration records, rock specimens and deals offered on the original property. Comparisons are made to existing deposits. The winner is usually not the first person on the site, more often the discovery is based on a clue left in the old records. Personally, I’d rather see alteration in a rock specimen rather than a dozen “good bets” on paper. There are too many others pretending to do our job, substituting their skills for a geologist’s.

There is greed in this industry, but it is perception, not greed, that adds to the wealth of the country. My guess is that 50% of the flow- through funds got beyond the brokers, fund managers and investors. I don’t think the geologists did too badly with their shares.

I am only guessing when I say that perhaps 20% of the new mining ventures brought in by flow- through will actually produce. Nevertheless, flow-through remains an ideal mechanism to automatically channel that extra dollar in the economy toward exploration.

Theoretically, this new system, a combination grant-subsidy, should prove better to junior mining because it reduces dilution. But if it is to be anything more than a grubstake for the majors, serious junior mining will have to win back the confidence of the investor. Hard financing is also an essential ingredient to their success.

Exploration is not quick and not easy. Too often geologists are not involved in management. Investors should realize that our industry has its share of honest people who are genuinely concerned with geological content. R. W. Metcalfe Metcalfe and Associates Ltd.

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