Project resource evaluation is a specialised task which relies on a high standard of technical ability combined with experience in evaluating other deposits. This is easy to say but even the best of us are liable to overlook some important aspects of project evaluation as it is frequently done under pressure with severe time constraints.

This checklist has been written for geoscientists engaged in resource evaluation at the various stages of development. ie.
bulletMineral Resource Calculations
bulletOre Reserve Calculations
bulletDue Diligence Studies

Mineral Resource Calculations

Resource calculations can be performed by a variety of techniques and for each technique there will be certain items which require checking. The following list is a global checklist for all resource calculation types.

Resource Calculation Checklist
bulletGeological Interpretation
bulletStructural data for geometric determinations
bulletSample Locations & density
bulletDrill collar data (coordinates, RL, dip, azimuth, depth)
bulletDown hole surveys
bulletUnderground workings - plans & assays
bulletSurface sampling ie tracks, pits, costeans
bulletSampling technique including recovery
bulletAssays - including repeats and duplicates
bulletAssay method & quality (precision & accuracy)
bulletCutoffs - upper & lower
bulletStatistical distribution
bulletBulk density determinations including variations
bulletTopographic data for section construction & air block removal
bulletMineralogical data to confirm extractability of metal
bulletGrid information
bulletTransfomation of grids if required
bulletOrientation of grids

Ore Reserve Calculations

Checking of reserve calculations is similar to resource calculations above except the additional mining data are required and more extensive information on items such as bulk density determinations is required.

Reserve Calculation Checklist
bulletGeotechnical data for determining pit slope angles
bulletBulk density data for variations in rock type oxidation type ore types and waste
bulletMetallurgical test work results. Met test samples should be >30kg.
bulletMulti-element analyses of major ore types
bulletAssay values for dilution skin
bulletMining constraints eg. minimum mining width
bulletMining recovery to be assumed for each mining location

As general rule, all ore reserve statements should be made in accordance with the latest release of the Australasian Institute of Mining and Metallurgy (AusIMM) Joint Ore Reserves Committee (JORC) Code (2012 version due for update late 2022), which sets out how reserves and resources should be classified and what qualifications are required to sign off the statement.

The Code has special sections dealing with coal and placer deposits, as well as a more recent release dealing with diamond deposits.

Due Diligence Studies

This is a brief programme of work which is conducted as part of the detailed feasibility study (DFS) or resource audit.  Its aim is to validate, where possible, key assumptions and data which are usually the bases of the pre-feasibility study.

Where project finance is required to provide some of the funds for the project construction and start-up, the due diligence programme helps to provide the lenders with a level of assurance they require when considering the reliability of the technical bases of the feasibility study.

Where a JV exists, it may provide a checklist for the minority partner to use as a measure of efficiency of the standard of the JV manager's execution of the feasibility study.

The due diligence programme may involve the drilling of a small number of extra holes through the deposit so as to provide a comparative baseline upon which to compare data for reproducibility.

A detailed checklist for this process has also been prepared by JSD, in association with Continental Resource Management Pty Ltd.

Mineral Asset Valuations

Mineral asset valuation is a specialised field, these days undertaken by certified valuers.  The most common form of mineral asset is a mineral tenement or a minerals project, which may be operational or not.  Valuations are almost always required by law in cases of the mineral asset changing hands, by virtue of a merger, sale or the like. 

The relevant code of practice for mineral asset valuation is the Code for the Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities for Independent Expert Reports (The VALMIN Code).  The current version is the 2015 Code, due for update later in 2023.

The VALMIN Code is recommended practice and should be adhered to when assessing and valuing Mineral and Petroleum Assets and Securities, regardless of where or for whom their Technical Assessments and/or Valuations are prepared or the location of the Assets under consideration or whether or not they are prepared by those who are members of Professional Associations having an enforceable code of ethics.

A Mineral Asset Valuation Report is likely to be used by readers having different interests and depths of technical knowledge. For the sake of clarity, but recognising that the use of technical language is sometimes essential (in which case a glossary of terms may be helpful), the Report should be written in plain English and must contain all information which the Commissioning Entity and others likely to rely on the Report, including investors and their professional advisers, would reasonably require, and reasonably expect to find in the Report, for the purpose of making an informed decision about the subject of the Report. For example:

(a) information regarding the sources of data used; 

(b) a description of the relevant Mineral or Petroleum Assets, including their location, plant, equipment, infrastructure and owner- ship; 

(c) an account of the Material history of the Mineral or Petroleum Assets. 

(d) sufficient information to allow experienced investment analysts to understand how the Technical Assessment and/or Valuation was prepared, including details (summarised if appropriate) of any financial model used and of sensitivities to variation 

(e) sufficient information about the valuation method(s) used so that another Expert can understand the procedures used and replicate the Valuation; 

(f) a review of any other matters that are Material to the Report; 

(g) a balanced, objective and concise statement of the Expertís review and conclusions so that an informed layman can have a clear understanding of the Mineral or Petroleum Assets or Securities concerned, their Value (if applicable) and of the attendant Risks; 

(h) a concise summary setting out the key data and important assumptions made and the conclusions drawn by the Expert and/or Specialists, qualified if necessary according to the insufficient or inadequate information provisions of Clause 54 of the Code.


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