Thursday, April 26, 2018

Advance Gold - A special kind of company

Some companies are special, Advance Gold is a very junior exploration company focused on Mexico.  They have assembled a highly talented team - the same dudes that were involved with Alset Lithium, so a "quality" company in all departments.

I was blown away by the hugely impressive PR on the Tesbasquena project (link). In the 200 days since the project was acquired, they've been sprinting out of the blocks and collected an almost unbelievable 18 samples. That exploration office mush be a hive of activity, especially now that they'll be drilling a humongous phase 1 drill program (2 holes for 500m) on their FULLY PERMITTED MINE.

We all know, it is important to take baby steps and not rush into things, quality over quantity. Like fine wine, we all know that you can't rush exploration. I mean, look at those amateurs at Silvercrest, rushing around being vampire-like (sampling all veins), drilling and all of that useless crap, I mean where where did it get them (link).

Ohh, but they don't have a FULLY PERMITTED MINE! So screw you Eric..

As Alain Benule Laputain tells us:

Yeah, the deepest samples were the best....bitches, none of that high-grade near surface crap.

Location, hmmm, that number refers to the level and normally uses the elevation (in meters - metric yards for the Yanks) above sea-level, so a bigger number is higher....

So, the half-kilo stuff is at the surface, but the (3) samples from the lowest working, the 2050 and 2059 levels did return some >200 g/t samples, so that's ok, but when you look at the number of samples/level, typically 2-3, you suddenly see that they mine is probably very small (90m vertical extent and probably something similar horizontally), but that doesn't matter as it is FULLY PERMITTED!!!

So all historic exploration has focused on the oxide zone? Just doing a quick literature search found thisI can across this (link)

That is quite a bit of info and 15 holes have been drilled, I would expect that a couple would have explored below the oxide zone, maybe you should ask PeƱoles for the drilling data?

I do have to applaud you for supporting local assay labs, trudging those 18 samples the arduous ~130km to the Laboratorio Metalurgico Courtade, in San Luis Potosi, when you could have just dropped them off at either of the two international ISO 9001 certified prep labs that are just 40km away in the city Zacatecas?

Why do things the easy way....
I wait, with baited breath the result from the drilling, 500m will only take 3-4 weeks to complete the assays about the same amount of time, so I'm looking forward to the end of May.

Tuesday, April 24, 2018

Pretium - an exercise for you

This is just a quick response to a comment by Tom. I originally created this Leapfrog viewer file for a previous post on Brucejack, focusing on a small area of the mine that I have put into Leapfrog.

Original post here - link

Download the Leapfrog viewer file from here (link)

The key slides are:

Slide 2 - The PR grades (i.e. the smeared grades) - nice juicy think gold intercepts

Gold fecking everywhere!

Slide 5 - Split grades (i.e. high-grade intervals removed and background grades back calculated) - now more of a needle in a haystack gold hits.

Oh no, its all gone!
Your job is to join the pink bits. Have fun!

Monday, April 23, 2018

Defiance Silver - I couldn't release the San Acacio drill results as.....

“Ahh, I thought it was in my bag, but it looks like I’ve left it at home by accident!”

“My computer crashed and I didn’t save my work!”

“I’ve been busy with extra-curricular activities and volunteering work”

“I’ve been so ill over the past few days, so I haven’t been able to look at the drill results”

"My mom CEO and dad CFO got in a huge fight last night"

"I tried writing the release, but I failed to understand the results"

"I was in a hurry, so I mistakenly left my laptop in my wife’s car, and now she’s in the office across town"

Or the least likely option - tell the truth:

"We don't want release the results, because they are shit. We hit nothing, the structure wasn't mineralized and we don't want to tell you as you'll abandon us like rats leaving a sinking shit ship"

Quick San Acacio Time line:
  • 31st October 2017 - commencement of 5,000m drill program (link)
  • 28th Feb, 2018 - Identifies a Large target (link) - PDAC promo PR
    • Prelim results from first 2000m of drilling - hit anomalous silver (i.e. nothing).
  • Here we sit 174 days later, no results....
By my estimates, Defiance should have drilled ~3000m by now, so 60% of the program done, and no assays reported, might as well wait until the end of the program, and release a phase 1 summary PR....

Evrim - a more detailed view

So I've compiled the data from the Cuale trenches, the Leapfrog viewer file is here (link)

left = trenches colored by number; right = trench Au assays

I've drawn on a guesstimate >1 g/t Au contour. We can see that this zone has approximate dimensions of 250m x 125m.

Why don't we focus on the very high-grade part of trench 4

Welcome to the nugget effect!

We can see that the ultra-high grade assays in trench 4 aren't repeated in the corresponding/adjacent samples in Trench 1. We can also see that they are less than 5m apart and that ultra-high grade zone is very small (6m x 6m).

We can also see that there are only 4-5 samples containing >30 g/t Au, and in the last post we saw the dramatic effect they had on the overall average grade for Trench 4. If this was drilling data, we would expect a top cut to been applied (here is a great presentation on cutting/capping high-grade samples - link)

Here is a semi-log graph of the assays - basically we're looking at how many samples (y-axis is frequency) occur within a certain assay range.

For example: In the chart below, the highest bar tells us that 38 samples returned assays between 1.5 and 2 g/t Au.

We seem to have 2 populations of samples, one centered ~1.5 g/t Au (red dashed curve) and a second at 0.1 g/t Au (blue dashed line).

So, we can see that we have very few (only 4) above 30 g/t Au, so maybe a 30 g/t top-cut could have been applied. If we do so, this is the impact:

  • Trench 4 now returns 106.2m @ 3.74 g/t Au - still good, but a >70% hair-cut

What else can we see? Look at the orientation of the trenches. They have 2 main directions:
  1. Trench 1 - NE-SW orientation
  2. Trenches 2, 3, and 4 - NW-SE orientation

Why did Evrim choose those orientations? Are there any clues?

streams = blue dashed lines
Have a look at the streams.

red and blue dashed lines = possible structural trends
Are there any other clues? Here is the Mexican Geological Survey's (SGM) map of the area (link). We can see that Cuale is in the La Gloria district.

Have a look at the San Juan Prospect (which I think is within the Evrim mineral concessions). The SGM have mapped an almost vertical NW-SE (125 strike) trending vein, and in the accompanying geological report (link - in Spanish), we also have a photo

vein - brown thingy next to the dude, probably a geologist as he is incredibly brave and handsome
I'm not saying that the mineralization at Cuale (Cerro la Gloria on the SGM map) is exactly the same as in the adjacent San Juan mine, but it gives us some additional information to make a basic, but useful interpretation from the data.

Now we can see that trenches 2, 3 and 4 are highly likely to have been excavated along some structures.

If you want to have some more fun, you can do some indicator kriging back of the envelope calculations to have a high quality resource calculation guess at contained gold.

  • Dimensions > 1 g/t Zone = 200m x 120m x 100m (depth extent)
  • Specific gravity - 2.8 tonnes/m3
  • Average grade = 1.5 g/t Au
Tonnage = 200 x 120 x 100 x 3 ~ 7.2Mt
Contained gold = 7,200,000 x (1.5/31.1) ~ 350Koz Au

These numbers are complete BS, but can be an interesting guide to potential size. Fingers crossed that they get massive thick intercepts of >1 g/t Au!

Wednesday, April 18, 2018

Leapfrog Views

You can download all the Leapfrog viewer files from here (link)

I normally compress them using winrar, which you can download from here (link)

If you want the full Leapfrog Project, send me an e-mail: with the name of the project you would like.

Monday, April 16, 2018

Evrim - Cuale - a quick comment

Evrim have released some stunning assays from some trenching done at Cuale (link and link), and their share price has gone crazy.

However, there may be a bit of a hangover, especially when you look at the detailed assay results  (link), where you can see that in Trench 4, you can see that they have sampled  2 very high-grade structures surrounded by a wide zone of >1 g/t Au mineralization.

red = good

If you take out these 4 high-grade intervals, this is what happens:

A bit less than 13.61 g/t Au

Still very good, but you quickly see that 83% of the Au if in just 5.8m or 5.4% of the trench.
The rest of the country rock is running >1g/t Au, so it is still a great result, but not a spectacular one.

The good news is, Evrim have identified a nice high-grade structure for drilling!!!

Friday, April 13, 2018

Pretium - Brucejack, the little mine that couldn't

The market loved Pretium's Q1, 2018 production figures (link).....for a day (lol)

Ramping down the shareprice
Why? Was there another another spectacular miss on grade.....again?

(looks through notes) - ohhh, juts missed by a mere 5.4 g/t or 35%.

But good news everyone, we've managed to miss out planned head grades every single month in the quarter. At best, they only missed by 4 g/t.

Don't panic

Now that we have 9 months of production figures, lets us look at the ramp up!


Ramp up went smoothly, they reached and exceeded plant capacity within 3 months.

They are milling consistently 5-10% more than planned. Good job guys.


Spot on!

and now it gets interesting....


Consistently bad, typically missing by a third, and this has a knock-on effect


So the difference in actual and projected (from the PEA) gold production is a measly:

~150,000 ounces

I know that some people think that the PEA isn't useful for anything, except when you need $811M to build a mine, or another way to put it:

They have been so efficient, they've decided to mine the material planned for years 16 and 17, to save the good stuff 'til last.

Another way to put it is, if they continue at the same level (head grade, mill throughput and recovery) for Q2, 2018, Pretium will have achieved the impossible normal*, they will have:

  • mined and processed 25% more ore and produced 25% less gold than outlined in the PEA

For that, I think you should get this:

The Sidam Touch

Personally, I can't wait to see the financials next month and the updated Mineral resource update in the fall.

If you've got this far, I have a mathematical challenge for you:

Get the numbers to work?

When I try it, I get Au production = 74,051.4 ounces, a difference of 1,338 ounces.

Or, to produce 75,689 ounces the head-grade needs to increase to 9.3 g/t Au or the recoveries to 99%.

*unfortunately, missing production targets is quite normal for mining companies.

Monday, April 9, 2018

Timok - the Lower zone - part II

Deep porphyries, what more could a geologist want. Several weeks ago I asked a simple question (link):

Will it be good or bad!!
We have some more results from Lower Timok (link) that put a few holes into this area.

They also drilled a few holes in the core of the deposit, and as they also announced that they'll have an initial resource estimate by mid-2018, i decided to have a go, and so here is one of my wonderfully pathetic resource guesstimates (TM). You can get the Updated LF views from here (link)

Quite big!
UPDATE - I used relatively crude grade shells for the CuEq calculations (multiples of 0.25% CuEq), I've updated this table using a 0.2% CuEq scale (so 0.2, 0.4, 0.6 etc).

This helps to smooth the data and prevents the final tonnages and grades being skewed.

In the last post (link) I used a 400m base range, and commented that this may be to large for resource calculation, so I've been conservative and reduced it to 300m, which I'm more comfortable with using as it is a reasonable value to define inferred resource.

Remember - using a very big search ranges is a good way to inflate resources in all deposits. In porphyries - anything above 300m is starting to look unrealistic, and is a good thing to check. In exploration, I like to use twice the average drill-hole spacing as a first pass.

It is looking quite robust,  shame it is at ~800m depth, but the numbers are still good enough to support a large underground operation, especially as they'll be making oodles of cash from the upper deposit.

Exploration upside

I also want to see if it can get bigger, from just a giant deposit to a massive one. With the CAPEX required to develop a large underground mine, Nevsun will want something that will support a 20+ year mine life. Again, if you see a project with a <10 year mine life, unless it has exceptional grades, it is best to avoid. It may pay back the CAPEX, but you want something that will generate enough revenues to develop the next project.

Here we have good news and bad news. Looking at a few sections through it

Yellow = long section location
cyan = cross section locations

Long Section

Damn, my great idea was crap. The could of holes drilled to look for the SE (left) continuation hit virtually nothing, and to the NW, the grades are decent, but we are getting very very deep (almost 2km).

SE Cross section

We can see that to the NE mineralization is closed off, but maybe below the Upper zone, we could see more mineralization. It is relatively shallow (~900m depth). I've doodled on what I think is the high temperature core, where normally there isn't much mineralization, but potentially it could mean that they only half of the system has been drilled. It would be nice to see some section showing Moly and vein-type distributions (*cough* *cough*).

NW Cross section

We're much deeper, but the mineralization is open to the NE and SW.

So there appears to be some obvious areas to expand the mineralization. however, I would like to see Nevsun start to use directional drilling or drilling wedge holes (similar to SolGold at Alpala).