Over the past few months I have been following a junior mining company with some unbelievable numbers for a palladium find. I haven’t been able to research this company through your paper, which I thought might cover or investigate it. The name of the company is Can-Cal Resources.
Scott Gammer
Alberta
The Pisgah Hill cinder cone is a geologically young volcanic cone, and Can-Cal acquired the property and some broken material in 1997.
Cinder cones are a notorious haunt of mining scam artists, and are noted in a short review of mining frauds in the southwestern U.S., Gold from Water, and Other Mining Scams, by analytical chemist Paul Lechler of the Nevada Bureau of Mines and Geology. But cinder cones have historically produced little or no gold. (That is one very good reason they are under-explored.)
Can-Cal’s public literature mentions little about the geology of the cinder cone, and nothing about nature’s signals that there is mineralization in the rock. A case in point: hard-rock gold deposits almost invariably show strong evidence of hydrothermal alteration in the wall rocks, indicating that mineralizing fluids have passed through fractures in the rock. Can-Cal’s literature doesn’t record anything like that at Pisgah Hill.
There is also no evidence, apart from Can-Cal’s say-so, that cinder cones are favourable environments for platinum or palladium mineralization. As you can see from descriptions on Can-Cal’s own web site, most production comes from deposits formed directly from a cooling magma, either in a mafic or ultramafic intrusive body, such as Sudbury or Stillwater, or in komatiitic volcanic rocks, such as Kambalda. There are hydrothermal platinum-palladium occurrences known, but they have produced very little metal. And no significant platinum-group metal production has ever come from a cinder cone.
You can’t dismiss an exploration play merely because it isn’t a lookalike for existing producers; there is always something new under the sun. But we’re betting palladium from cinder cones is not that something.
Through 1999, Can-Cal had outside firms — firms it has never publicly identified — perform extraction tests using “reduction fusion” and a “plasma furnace.” Neither technology is described on Can-Cal’s web site, because the contracts with the firms have confidentiality clauses. Confidentiality clauses legitimately protect intellectual property, but they also make it difficult to assess the scientific value of the work being done. In the worst case, they simply shield pseudo-science from public scrutiny.
Results from the Pisgah property released on June 2 and 27, and Aug. 11, spoke of “certified confirmation of the presence of a significant content of precious metals,” by independent laboratories. But if you read the releases closely, you find the company only reports assays on dore bars and buttons produced by an unidentified “research and development company,” rather than on material that was sampled and sent to the lab without pre-treatment.
Put shortly, if you send a sample from a bar of metal produced in a confidential process to a reputable lab, and that lab finds precious metals in the bar, it means only that there are precious metals in the bar. It says nothing about the precious-metal content of the test material.
The detail Can-Cal presents about its tests in its Aug. 27 release pales into superfluity next to this fact.
Similarly, gold, platinum and palladium results announced in March and April were from “sponges” produced by a recovery process that Can-Cal contracted from two Arizona men, James Ardoin and Cameron Miller. Can-Cal’s consulting geologist, Bruce Ballantyne, took the samples and witnessed the process, but that is not the same as having a secure sampling and custody program that ships samples directly to an independent lab.
Our experience is that if a firm needs to pre-treat its samples, and if it sends the pre-treated material out to be assayed at a reputable lab, presenting the results of the outside lab’s assays as a “confirmation” of precious metals in the original samples, the project will later prove to be worthless. It has happened over and over.
Another passage from Can-Cal’s web site, discussing the Owl Canyon joint venture in California, reveals another bad sign — the company likes to do its own assaying. “Although the joint venture has the capability to and does perform its own fire assays, it has sent both crushed materials and actual lode rocks to independent laboratories for fire assay. . . . The joint venture has performed in excess of 550 in-house assays on its lode claims, over 90% of which produced gold and/or silver dore beads.”
In-house assay labs have a long history of providing made-to-measure analytical results for highly promotional junior exploration companies. For a company with an in-house lab, it is always a short step to start claiming that the mineralization on your property is “unresponsive to conventional chemical analyses,” and only can be detected using proprietary (and invariably undisclosed) assaying techniques.
Many companies with operating mines do their own assaying, for mine grade control, mill process control, and internal use in the company. They do not, however, present in-house results in press releases and disclosure documents. Neither do they use non-standard analytical methods or code-named reagents in their analytical process.
In summary, we see a lot of reasons for caution in assessing Can-Cal, and frankly find it difficult to believe the conclusions the company has reached about its principal exploration property.
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