I think that alemond is trying to offer a cautious viewpoint regarding the possible disparity and potential confusion regarding the different possible meanings/results of grade as applied to a narrow vein underground mine.
I don't think he is trying to downramp for the sake of it.
I do think that clarification is needed in regard to this issue, because this information has been used for the purpose of manipulation in the past (perhaps it occurred through ignorance), and still has not been clarified succinctly.
So how it works is this ...we have an extremely high grade deposit of coarse (and clustered) free gold. Because it is clustered as opposed to having uniform mineralisation, we are unable to conduct a JORC until such time as we actually develop the drives and take bulk samples from the wall -which is how we arrived at our initial JORC MRE, and why it only covered approx 125m x 125m.
There are methods of using probability and statistical analysis to estimate the grade once there is enough data (but I digress).
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The real issue at hand is how much gold do we have and what do we mean by high grade ore, and how do we convey this information.
So lets imagine this ...we have a narrow underground blanket of quartz bearing mineralisation dipping at 22.5 degrees. This blanket has regions of higher grade and lower grade across the strike (of this blanket) and there is evidence (it is suspected) that the grade follows "shoots" of these higher regions down dip. At this stage the extent of grade is unknown. While there is some evidence that the higher grade shoots continue down dip, how far down dip we don't know, but I think we can safely say that we have hardly scratched the surface.
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We do know that we have gold mineralisation hundreds of meters in distance away from our current mining area. Two drill holes that are worth noting are CDP009 (with 4 separate lodes intersected) and CDP004 with the fantastic intersection of 3.4m @ 38 g/t):
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and we also know that the mineralisation exists over several lodes (Cascavel/Mestre, Cuca, Espaniola), but at this stage we cannot identify which lode they belong to at each drill hole.
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The gold bearing quartz vein ranges from (lets say) about 30cm in thickness, to several meters in thickness in some places. The following diagrams provides a good illustration of the variability of the gold rich quartz:
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So we are now at the point that needs clarifying, the ore that is processed is always diluted by waste of some quantity. The amount of that waste depends on the mining method. We are now trialing our new mining method involving air leg miners that allow removal of the mineralised zone with minimal dilution between the drives. However, this still leaves the drives. If you can imagine that they are say 2.8m wide by 2.8m high, there will obviously be considerable dilution with waste if the high grade zone cannot be removed separately (especially if the HG zone is only a 20-30 cm in thickness. Keep in mind that the drives cannot slope at 22.5 degrees like the mineralised "blanket".
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Craig Dawson told me that (in the drives) they were experimenting with (the economics of) taking out the high grade zone with a mini excavator with rock hammer, before removing remaining waste separately. This would avoid dilution and save on processing costs BUT there is still the same amount of gold there.
To give an idea of the drives and the dilution, the following is the old way we mined ...but it shows the concepts of development drives and dilution:
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In my humble opinion, anyone who thinks that we will take tens of thousands of tonnes of low grade development ore and magically turn it from 2 g/t to 25 g/t has quartz in their head. Do we have the ability to extract more gold using a hammer mill? Yes definitely I think that is probable, going on the evidence, but lets not kid ourselves with the quantum of the increase possible from this diluted ore. I'm sorry, but this doesn't fully explain our poor results to date to me -(Sooo happy to be proven wrong).
Where the mine may show a great improvement is in conjunction with mining the high-grade quartz gold vein WITHOUT significant dilution, and these results are likely to be excellent -especially with a hammer-mill (considering the positive results from the test).
OK, I've tried to show the difference between the (ore diluted with waste)
apples and the (pure gold rich quartz mineralised vein)
oranges, so lets keep this in mind.
Please don't think I am underestimating the fantastic grades we have already found from previous bulk samples:
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Also let's not underestimate the scope of the mineralised system. The most recent drill hole intercepted mineralisation 1.2 klm down-dip. This is a massive system.
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I remain convinced that this will become one of the world's top UG mines by grade, and I remain convinced that we are on track to reduce costs below production income based on the new remuneration/incentive scheme. If I was in charge, I would extend a modest incentive scheme to all workers (especially including the guys swinging off the air-leg miners).
The JORC MRE is still completely valid (AFAICT), and the resource estimate RE will prove to be conservative (AFAICT).
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Why OGX has apparently decided NOT to mine the high-grade stopes that have been developed over last 6 months, and why they decided to be selective regarding WHO THEY GAVE THIS INFORMATION TO is a great cause for consternation for me, and I will be seeking answers.
Yes, I think the future looks much brighter ...but it not easy to quantify just how bright and how long it will take to need sunglasses.
Seasons Greetings.
SJB
