|
The following two diagrams provide an illustrative overview of a resource project implementation and the relationship between Mineral Resources and Mineral Reserves.
The Project Evaluation and Implementation Process Phases diagram illustrate the stages from exploration to mine closure. In terms of rare earth elements, it can take 10-15 years from the time a deposit is found to the time the project goes into production.
The Relationship between Mineral Resources and Mineral Reserves sets out the framework for classifying tonnage and grade estimates so as to reflect different levels of geological confidence and different degrees of technical and economic evaluation.
Below are more detailed definitions as sourced from National Instrument 43-101, CIM Definition Standards, Basinvest Valuation of Metals and Mining Companies, and The Northern Miner Mining Explained, 10th Edition.
QUICK LINKS TO:
Feasibility Terms
Resources and Reserves Terms
General Terms
|
|
Resource Project Evaluation and
Implementation Process Phases
|
|
|
Click to view larger image
|
|
|
|
|
|
Relationship between Mineral Resources
and Mineral Reserves
|
|
|
Click to view larger image
|
FEASIBILITY TERMS
Listed in order of increasing confidence
Preliminary Economic Assessment (also referred to as a Scoping Study) is an early stage study based on the economics of a mining project used for development planning. It is generally based on assumptions and estimated costs, and is neither as detailed nor as reliable as a Feasibility Study.
Prefeasibility Study (Preliminary Feasibility Study) is a comprehensive study of the viability of a mineral project that has advanced to a stage where the mining method, in the case of underground mining, or the pit configuration, in the case of an open pit, has been established, where an effective method of mineral processing has been determined, and includes a financial analysis based on a reasonable assumptions of technical, engineering, legal, operating and economic factors and evaluation of other relevant factors which are sufficient for a competent person, acting reasonable, to determine if all or part of the Mineral Resource may be classified as a Mineral Reserve.
Feasibility Study is a comprehensive study of a mineral deposit in which all geological, engineering, legal, operating, economic, social, environmental and other relevant factors are considered in sufficient detail that it could reasonably serve as the basis for a final decision by a financial institution to finance the development of the deposit for mineral production.
“Bankable” or “Definitive” Feasibility Study is a comprehensive forward analysis of a project’s economics to be used by financial institutions to assess the credit-worthiness for project financing.
RESOURCES AND RESERVES TERMS
Listed in order of increasing confidence
Mineral Resource is a concentration or occurrence of material of intrinsic economic interest in or on the Earth’s crust in such form and quantity that there are reasonable prospects for eventual economic extraction. Portions of a deposit that do not have reasonable prospects for eventual economic extraction should not be included in a Mineral Resource. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories. An Inferred Mineral Resource has a lower level of confidence than that applied to an Indicated Mineral Resource. An Indicated Mineral Resource has a higher level of confidence than an Inferred Mineral Resource but has a lower level of confidence than a Measured Mineral Resource.
Inferred Mineral Resource is that part of a Mineral Resource for which quantity and grade or quality can be estimated on the basis of geological evidence and limited sampling and reasonably assumed, but not verified, geological and grade continuity. The estimate is based on limited information and sampling gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes.
Indicated Mineral Resource is that part of a Mineral Resource for which quantity, grade or quality, densities, shape and physical characteristics, can be estimated with a level of confidence sufficient to allow the appropriate application of technical and economic parameters, to support mine planning and evaluation of the economic viability of the deposit. The estimate is based on detailed and reliable exploration and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough for geological and grade continuity to be reasonably assumed.
Measured Mineral Resource is that part of a Mineral Resource for which quantity, grade or quality, densities, shape, and physical characteristics are so well established that they can be estimated with confidence sufficient to allow the appropriate application of technical and economic parameters, to support production planning and evaluation of the economic viability of the deposit. The estimate is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough to confirm both geological and grade continuity.
Mineral Reserve is the economically mineable part of a Measured or Indicated Mineral Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information on mining, processing, metallurgical, economic and other relevant factors that demonstrate, at the time of reporting, that economic extraction can be justified. A Mineral Reserve includes diluting materials and allowances for losses that may occur when the material is mined. Mineral Reserves are sub-divided in order of increasing confidence into Probable Mineral Reserves and Proven Mineral Reserves. A Probable Mineral Reserve has a lower level of confidence than a Proven Mineral Reserve.
Probable Mineral Reserve is the economically mineable part of an Indicated and, in some circumstances, a Measured Mineral Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information on mining, processing, metallurgical, economic, and other relevant factors that demonstrate, at the time of reporting, that economic extraction can be justified.
Proven Mineral Reserve is the economically mineable part of a Measured Mineral Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information on mining, processing, metallurgical, economic, and other relevant factors that demonstrate, at the time of reporting, that economic extraction is justified.
GENERAL MINING TERMS
In alphabetical order
By-product is a secondary or additional product recovered in the extraction process (e.g. molybdenum is a common by-product of copper). For example, Avalon's Nechalacho rare earth elements deposit, Thor Lake, NWT has valuable potential by-products zirconium, niobium and tantalum.
Dilution is when a company mines a considerable amount of unwanted, barren rock along with the ore. This waste rock must then be transported to surface with the ore, causing dilution of the ore and costing the mining company money. Dilution decreases the overall grade of the ore mined and reduces mining margins.
Exploration is searching for natural resources: the testing of a number of places for natural resources, e.g. drilling or boring for samples that will be examined for possible mineral deposits. Exploration aims at locating the presence of economic deposits and establishing their nature, shape, and grade.
Metallurgy is the study of metals: the study of the structure and properties of metals, their extraction from the ground, and the procedures for refining, alloying, and making things from them.
Mine Design is a framework of mining components and processes taking into account mining methods, access to the ore body, personnel, material handling, ventilation, water, power and other technical requirements such that mine planning can be undertaken.
Mining is the science, technique, and business of mineral discovery and exploitation. Mining includes all activities related to extraction of metals, minerals and gemstones. Strictly, the word connotes underground work directed to severance and treatment of ore or associated rock. Practically, it includes opencast work, open cut work, quarrying, alluvial dredging, and combined operations, including surface and underground attack and ore treatment.
Ore is a mixture of valuable minerals and gangue minerals from which at least one of the minerals can be extracted economically. An ore body is a natural concentration of valuable material amenable to economic extraction.
Pilot Plant a small-scale metallurgical plant built to test a process and to generate information about the behavior of the system for use in design of larger facilities.
Qualified Person is an individual who is an engineer or geoscientist with at least five years of experience in mineral exploration, mine development or operation or mineral project assessment, or any combination of these; has experience relevant to the subject matter of the mineral project and the technical report; and is a member or licensee in good standing of a professional association.
