Abstract
The majority of mines constructed over the past decade have underperformed significantly or have been shuttered. The failure rate is lower for mining companies than for mine developers. Resource and Reserve overestimation are the fundamental cause for most of these failures; often requiring major revisions to the estimates and an overhaul of the classification parameters. Resource estimation specialists are often faced with insufficient drill information to form a robust understanding of controls on mineralization, which, in turn should lead to a reduction in classification or wholesale declassification of large parts of mineral deposits.
Mineral resource risk can be divided into two distinct layers of risk: grade risk and geometric risk. Geometric risk includes the size and shape of domains above cut-off grade within a broader and more predictable geological mineral deposit solid. The author will argue that the weaker of the two risks should be the primary consideration for mineral resource classification. There are several useful tools to enable the evaluation of grade risk within deposits, most notably conditional simulations; however, tools for quantification of geometric risks are lacking. Practitioners can qualitatively estimate the geometric risk of mineral resources by analysing the number of drill hole pierce points supporting each domain above cut-off grade.
Prescribed drill spacing for a given mineral resource classification from operating mines in Canada are generally more tightly spaced than for equivalent deposit types described in mine developer Technical Reports. There are many causes for the lower classification standards including human factors and the lack of understanding of mineral resource risk. Specifically, qualified and competent persons rely too heavily on the range parameter of variograms to inform the classification scheme. Conventional variograms contain little or no information regarding the continuity of “reportable resource” and can be highly misleading. This statement is bolstered by the fact that the conventional variogram is not affected by changes in the cut-off grade, whereas the risk to the mineral resource increases with increased cut-off. Furthermore, the conventional variogram does not capture any information regarding geometric risk, including the shape of domains above cut-off grade.