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Ann: Ternera resource definition drilling continues to deliver, page-30

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mach8

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30/04/21

09:00

Post #: 52832381
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Originally posted by Maverick7: ↑

There is no one-size fits all when it comes to open-pit mining as grades, strike length, metallurgy, etc all will come into play, but probably the most critical factor is the depth of where the "economic" ore starts. This is because the deeper the ore starts, the more money and time will be needed to "strip" the waste/uneconomic rock above the ore.

Each deposit will be different, but from my experience, when the majority of ore starts at deeper than 75m+ it generally is starting to become expensive/uneconomic to develop an open-pit and underground methods will then be preferred. However, underground mining usually requires a higher grade to be feasible as the mining costs and risks to extract the ore are generally higher.

Yes, open-pits for gold deposits in rare occasions can extend to 300m+ deep, but these are the exceptions and generally the pit would have started with ore close to the surface, and the depth incrementally mined via cut-backs ie. extending the pit downwards if the economics justify.

Looking at the 5 highlighted results in this announcement, one of the intercepts starts at 8m however the economic section of the intercept actually starts much deeper "from 98m". In the rest of the holes, the intercepts start from 80m all the way down to 250m+.

Therefore, based on what I have outlined above, looking specifically at these results, they appear too deep to be economic using open-pit methods.
However, these intercepts might infill/extend prior intercepts which started at shallower depths...

This is why sectional diagrams would be extremely useful in trying to assess the intercepts within the context of the deposit as a whole, and why it is very perplexing that the company does not include such diagrams when releasing new exploration results.

I'm not a geologist/engineer so take what I say with a grain of salt, however I have been investing and following mining stocks for 20+ years.

Hope this helps.

Cheers
Maverick

Expand

Hi Mav.

One of the classic mistakes people make regarding the interpretation of TSO intercepts is that they forget the type of gold system they’re trying to interpret.

El Zorro is an intrusive related gold system (IRGS). You need to understand that this type means it is mineralised from surface to depth. In other words, relatively high grade intercepts surrounded by a lower grade ‘halo’ of mineralised ore.

The intercepts you refer to are simply the ‘SIGNIFICANT’ intercepts and are tabled for easy reference. The actual full assay includes many more multiple lower grade results, starting near surface and extending to depth. In the early days, the company used to list every assay metre with the corresponding grade of Au. They don’t bother now, too much info for the average punter perhaps.

The ‘economic’ ore you refer to is not necessarily the higher grade intercepts. The more of these the better obviously, hence why they’ve extended four more holes in this Ann. But the bulk style of the IRGS only requires a far lower grade to be economic.

With each presentation, the company provides updated sectional diagrams. A bit boring to see guys harping on about these..

Your interpretation of an open pit only being economic in shallow depths and high grade is deeply flawed and suggests you don’t understand IRGS style systems. Especially in a tier one country like Chile where costs are significantly less than Australia in nearly all facets.

M8

Originally posted by Maverick7: ↑

There is no one-size fits all when it comes to open-pit mining as grades, strike length, metallurgy, etc all will come into play, but probably the most critical factor is the depth of where the "economic" ore starts. This is because the deeper the ore starts, the more money and time will be needed to "strip" the waste/uneconomic rock above the ore.

Each deposit will be different, but from my experience, when the majority of ore starts at deeper than 75m+ it generally is starting to become expensive/uneconomic to develop an open-pit and underground methods will then be preferred. However, underground mining usually requires a higher grade to be feasible as the mining costs and risks to extract the ore are generally higher.

Yes, open-pits for gold deposits in rare occasions can extend to 300m+ deep, but these are the exceptions and generally the pit would have started with ore close to the surface, and the depth incrementally mined via cut-backs ie. extending the pit downwards if the economics justify.

Looking at the 5 highlighted results in this announcement, one of the intercepts starts at 8m however the economic section of the intercept actually starts much deeper "from 98m". In the rest of the holes, the intercepts start from 80m all the way down to 250m+.

Therefore, based on what I have outlined above, looking specifically at these results, they appear too deep to be economic using open-pit methods.
However, these intercepts might infill/extend prior intercepts which started at shallower depths...

This is why sectional diagrams would be extremely useful in trying to assess the intercepts within the context of the deposit as a whole, and why it is very perplexing that the company does not include such diagrams when releasing new exploration results.

I'm not a geologist/engineer so take what I say with a grain of salt, however I have been investing and following mining stocks for 20+ years.

Hope this helps.

Cheers
Maverick

Expand

Originally posted by Maverick7: ↑

There is no one-size fits all when it comes to open-pit mining as grades, strike length, metallurgy, etc all will come into play, but probably the most critical factor is the depth of where the "economic" ore starts. This is because the deeper the ore starts, the more money and time will be needed to "strip" the waste/uneconomic rock above the ore.

Each deposit will be different, but from my experience, when the majority of ore starts at deeper than 75m+ it generally is starting to become expensive/uneconomic to develop an open-pit and underground methods will then be preferred. However, underground mining usually requires a higher grade to be feasible as the mining costs and risks to extract the ore are generally higher.

Yes, open-pits for gold deposits in rare occasions can extend to 300m+ deep, but these are the exceptions and generally the pit would have started with ore close to the surface, and the depth incrementally mined via cut-backs ie. extending the pit downwards if the economics justify.

Looking at the 5 highlighted results in this announcement, one of the intercepts starts at 8m however the economic section of the intercept actually starts much deeper "from 98m". In the rest of the holes, the intercepts start from 80m all the way down to 250m+.

Therefore, based on what I have outlined above, looking specifically at these results, they appear too deep to be economic using open-pit methods.
However, these intercepts might infill/extend prior intercepts which started at shallower depths...

This is why sectional diagrams would be extremely useful in trying to assess the intercepts within the context of the deposit as a whole, and why it is very perplexing that the company does not include such diagrams when releasing new exploration results.

I'm not a geologist/engineer so take what I say with a grain of salt, however I have been investing and following mining stocks for 20+ years.

Hope this helps.

Cheers
Maverick

Expand

Last edited by mach8: 30/04/21

TSO Price at posting: 19.0¢ Sentiment: Buy Disclosure: Held
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