Letters Evaluation Problems

For new properties approaching production, attention is rightly given to metallurgical recovery, even to the treatment of bulk samples of ores that are apparently amenable to standard methods of treatment. But only few mines fail because of a low mill recovery, while most failures can be attributed to a catastrophically low mine recovery. Nevertheless, less consideration seems to be given to the base against which any predictions of metallurgical recovery should be made. There are at least two earlier recovery factors that must intervene between a geological estimate of the inventory of useful mineral and the material from which a metallurgical recovery is ultimately sought.

The initial estimate of tonnage and grade is made from sampling results, interpreted according to geological experience and opinion, and maybe geostatistics; at this stage it will be essentially a pure inventory unqualified by either mineability or economics. This process has its own well-known uncertainties (classified by the time-honored terms proven, probable and possible), especially for gold veins and despite the undoubted help of geostatistics and the computer. But, even granting 100% accuracy, the next stage of design requires converting probably irregular outlines into mineable widths and areas, shapes or volumes. There is a common problem of reconciling what seem to be widely different ore outlines on adjacent sections or level plans. This is particularly difficult if these outlines have been drawn as cut-off contours. However done, the transformation necessarily results in a diminution of grade. Design dilution is probably a useful term, although there is more to it than the simple addition of waste. There is also a loss of higher-grade material and usually an offsetting gain of lower-grade or waste, whereby the tonnage may be higher or lower but the valuable content will almost always be reduced. Be that as it may, we still have made only a static determination of what can, and may eventually, be mined.

With the dynamics of actual production, very similar factors must again appear just because mining cannot be perfect nor exactly foreseen. Some ore may be irrecoverable, while there may be involuntary admixture of waste from outside the mining design. The logistics and economics of underground mining may mandate the treatment of lower-grade development ore or other supplementary material. As before, the tonnage may be higher or lower, but grade must again be down. We can refer to this as production dilution, noting that it is not by waste alone.

For three major types of ore deposits, I illustrate in the accompanying chart the sequence of factors and changes. (The chart was prepared for a speech I gave at a conference and is included here by courtesy of the Institution of Mining and Metallurgy, London.) The mines in Knoll’s article are obviously in Class C. There is obviously a lot more to things than adding an arbitrary 10% dilution to a geological estimate, calling the result either mineable or fully-diluted, and then expecting the mathematical result to appear faithfully at the mill head. At the very least, one should indicate very clearly what category of tonnage- and-grade estimate is announced and can be supported — whether this tonnage is geological, designed mineable or a direct forecast of production. It is only to the last category that a metallurgical recovery factor can be legitimately applied.

Knoll quoted the views of seven analysts and only two other sources, but commented: “of course, the analysts must bear some of the blame for this.” I have wondered to what extent the methods of stock analysis are responsible for the present craze of reporting both reserves and outputs only in ounces of gold, or even worse, gold-equivalent. If not a cause, this is at least a symptom of the mine-failure syndrome. To apply a metallurgical recovery factor to the gross gold content of a geological reserve (a practice I have encountered) is really asking for trouble.

My only other comment is on cost estimation. Knoll isn’t altogether clear, but seems to suggest that some projects did their cost estimates directly in U.S. dollars per ounce based on the performance of others. If true, this must be irresponsibly dangerous. Cost per ounce (in any currency) is a valuable guide, but it is purely a calculated figure whose magnitude is completely sensitive to the number of ounces recovered. Hugh K. Taylor, P.Eng., West Vancouver British Columbia

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