Written by Andy Randell and published on LinkedIn on January 19th, 2015
Ok, I get it … the markets suck. Apathy has drained nearly all enthusiasm from 90% of the CEO’s I met today at the Cambridge House ‘Vancouver Resource Investment Conference’. There were barely any rocks for me to look at and get a tactile familiarity with, let alone maps … or even pens! (These conferences are great for so many things, not least restocking on pens and USB keys for the upcoming year!)
But today I had an epiphany – I discovered what the disconnect is between me, the rocks and the Juniors! Finally, it all makes sense! The revelation is simply this;
I am a (geo)scientist!
I can still get excited about the rocks, minerals, geochemistry and therefore the potential of a project without the headache of finances raining on my parade! Looking around the booths at the maps and scant rocks, my mind was a colourful blur of ‘all the things I would do’ on this project. My enthusiasm knows no limits!
When I finally got a company representative off of their Blackberry (or away from the Seahawks game) and to engage me, I genuinely saw some minds blown at the suggestions I made for ongoing, low-budget work. This next bit will sound cynical, but I make no apologies; I guess that is what happens to a company when they lay off all of their technically trained and / or experienced staff, there is no in-house, colourfully thinking (geo)scientist supercharged on enthusiasm to kick start these cheap projects!
Just another note here to the people who are reading this and are saying “well, I have geologists on staff still” – ask yourself this, have you clipped their wings? While you are wearing the heavy burden of fiscal responsibility, have you unintentionally reigned them in? Just a thought …
So I think it is only fair that I share some of these ideas – frankly I have to otherwise these swirly colourful thoughts will keep me awake tonight! All of these are relatively cheap, advance the science and even could save (lots) of money and time in the future, whilst also giving a company tangible data and evidence they could tell their investors about.
(And yes, I did a post very similar to this a few months back, but the message really needs to be reinforced as we start 2015!).
Here we go, my ’10 for under 10′ list!
1. Aerial Photo Surveys (estimated costs $0 to $1500)
This one might not apply to all, but Canada and the US have great resources of high quality satellite / aerial photo imagery that is available for free. These images can be obtained and studied alongside geological maps and observations to determine trends over a wider area.
As an example, the Energy, Mines and Resources Library in Whitehorse (Yukon Territory) has most of the land photographed at 8000ft, all of the plates from this work is freely available if you physically go into the library, pull the images and scan them (they even have a FREE high resolution scanner in the library!).
Beyond that, LandSat has a large database of free satellite imagery available. I recently helped identify possible oxidation zones around intrusives in the Gobi Desert in Mongolia that were then investigated by field geo’s based there. These images are georeferenced, can be over-layed easily into Google Earth and therefore give coordinates specific enough to send a team out in a jeep into literally the middle of nowhere.
The main costs here are derived from physically paying someone to retrieve the information and process it, and would obviously depend on size and scope of the projects.
2. Maps and Sections (estimated costs $0 to $2500)
Oh, this one grinds my gears so much. How many times have I walked into a Junior to write a technical report or help design an exploration program only to find that they don’t have any maps or sections drafted?! You don’t have a GIS person? No problem! All geologists should be able to plot their data onto a blank sheet of paper; add a box of Crayola’s and voila! You have a geological map!
Personally I love doing this exercise. Being told to hand draw a map was akin to the days when you would get a stand-in teacher at school who just made you do ‘colouring-in’ instead of trigonometry!
Grab your data, a big sheet of paper, drawing implements and most importantly a 6-pack of beer and get drafting! There is also a lot to be said for this ‘manual labour’ too, as today we rely on information being fed into a computer and being generated by a GIS employee who is not always a geologist at heart. This dispassionate assimilation of data disconnects you from the subtle patterns and trends that exist in all rocks, but by drawing it you become familiar with every single dot on your map.
Again, the costs here more or less depend if you have someone on staff to do this work, or if you outsource it. Plus the beer of course.
3. Assay Method Reviews (estimated costs $500 to $2000)
Are you really doing your samples justice? Is that four-acid digestion with gravity finish the right method? Should you be crushing you samples to pass a finer mesh? Now is the ideal time to test these theories, as your gold (or other commodity) could be stubbornly hiding inside those tiny arsenopyrite crystals and resisting liberation due to the coarse crushing (< real world problem!).
This downtime means that not only do you have time to step back and research these methods, but also that the labs are quiet and begging for your work! Just recycle your coarse reject material and play with the method, see what happens. It might be nothing, but it might also be a 10% grade increase for simply getting creative with your samples. What investor / CEO / geologist wouldn’t love an extra 10% gold in their resource estimates down the road?
This kind of exercise will largely depend on the number of samples you would want to run, and how many difference processing routes you would explore, but I have done these kind of analyses for under $2000.
4. Property Summary Reports ($0 to $2500)
OK, really this is like writing your Biography or even your Will; laying out all the information to preserve it for future generations.
As things warm up in Exploration again, a few scenarios play out for properties. The first is that they will be taken over by another company, or (perhaps more optimistically) you will be employing new geological staff who need to get up to speed.
Having a document that is written on your property that breaks down all the work to date, the methods used, the areas covered and suggestions of future work smooth the wheels of progress tremendously. For a new company, it will help sell the property if all the information is in one document as opposed to spread through the laptops of several (now departed) staff.
I would suggest writing any report using the NI 43-101 framework wherever possible …
The costs again are dependant if you are producing in-house or outsourcing to a consultant.
5. Umpire Testing ($1000 to $3000)
This is another woefully under valued tool in the geologists arsenal. For those who do not know, Umpire Testing allows you to compare your main assaying lab with an independent one to allow you increased confidence in your results.
This is essentially a statistical analysis, but the processing of samples is minimal as you use pulps from the original lab, and then just assay for your main commodity, i.e. Gold, as opposed to the usual 36-element package you run.
The costs are based around the number of samples and whether you have an independent contractor undertake the selection and analysis for you.
6. Data Consolidation (estimated cost $0 to $3000)
This goes along with the drawing of maps and sections as a major gripe I have. I recently did some work for a company (who shall remain nameless), and when I asked for their data, I had to mine it from their server, and then piece together missing information from the mailboxes of their recently laid-off geological team.
Get it all together in a database / spreadsheet or even on the same server, it saves so much hassle in the future.
Just take a second to think about how much each sample assay actually cost you: the drilling, the mobilization, the fuel, the food, the staff, the accommodations, the transport, the assaying, the taxes … it all adds up. It is therefore highly irresponsible to have spent millions on collecting data to not have it in an organized system.
Sort it out … now! Please!
7. Program Development (estimated cost $0 to $4000)
Daydream. Fantasize. What would you like to do with your program in the future? It’s OK to dream big here – this is purely a ‘thought exercise’ and will not actually burn funds.
But what if tomorrow someone came along and gave you $10 million to develop your property? I am guessing that the majority would jump for joy, hire a drilling company and a couple of Geo’s and go poke holes all over the property for the Summer. But is this the best thing? Could that money be better used in other ways? Is your property at a stage that it is demanding some other (less sexy) work to be done (see above … and below!)
Similarly, what will you do to advance the property assuming that there are no more funds available in the next few years? It doesn’t have to be ‘shut the doors, turn off the lights and go home’.
A little bit of research right now goes a long way – War Games for Geologists! If you can do this in-house, then it’s free, but sometimes outsourcing this is a great way to get a fresh prospective and possibly come up with suggestions you would not have thought of.
8. Documented Quality Control Procedures (estimated cost up to $5000)
When you get to a certain size (i.e. more than one member of staff), it pays to have a well thought out and documented Quality Control procedure written out.
This should cover collection techniques, shipping and security, control samples, assaying methods, reporting, data assimilation and umpire assaying. For sure, it is a fairly involved piece of work to produce this, but it really helps in future development.
I have written several of these, and they are especially useful during the post-recession surges – a time when most of the (costly) mistakes happen. These kind of guidelines are also required should you be trying to produce resource numbers in any kind of pre-feasibility study – so why not get on it now while we have some time?
9. Mineralogical Studies (estimated costs $4000 to $8000)
Assuming that you have collected field samples or have been drilling with some interesting results, it might be a good time to dive a little deeper into your rocks beyond interval calculations.
By undertaking studies of the suite of minerals in your samples, we can start to build up an important geochemical profile of your deposit – including phases and heat regimes – all of which can help with future discoveries.
Only have pyrite in your rocks? No problem! Let’s look closely at it to see if the gold is encapsulated in the crystals! Maybe we should identify the minerals in those alteration haloes to get more familiar with the heat and flow patterns of your deposit (they we can rush back to the office and draw the information on your maps!).
Generally I budget about $600 per sample for a full study, including QEMSCAN and Mineral ID work by one of the labs.
10. Metallurgical Studies (estimated costs $7000 to $10000)
So you have drilled twenty holes in your property. Your assays are good and you have decent intervals (although the market is unresponsive to your good news!). Now is the time to do some basic metallurgical work where we can study the location of the commodity within the rock, and how to extract it. For example, we could do a Deportment Study of gold from your samples to see how much is recoverable in a gravity circuit, followed by a cyanide bottle roll test to find out how much we can leach.
If the results are not encouraging, then is it worth spending more money on drilling the Zone? While the market is not paying attention anyway, you can make a quiet exit from an unimpressive property and refocus your efforts and funds on a new prospect. Doing this during boom time can be suicide for a company as investors will lose all confidence in you, your team and your portfolio.
So there we have it – this is not an exhaustive list; there is plenty more that can be done! I am happy to talk more about it with you individually and look forward to your comments!
The scientists are still here and are loving your properties even if your investors aren’t! We have your back!