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Strategies & Market Trends : The Ego Forum

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To: hubris33 who wrote (9603)	3/2/2011 2:02:51 PM
From: hubris33	2 Recommendations Read Replies (1) of 12175

Some NAI Analysis ..... ......... ......... OK so after such a wide miss on the guesstimate of NAI's ounces I thought it prudent to look into the specifics to see what differences there are..... I used the block diagram provided on the website "3_D Voxel grid (Kriged showing gold in drill holes view looking NW" as the basis for my evaluation. Something of that nature had to have been the starting point for the modeling Geo. That block model gave measurements of 243 x 530 x 140 meters. The NR says the current length is 550 meters which matches well with that block model. The length and thickness the Geo modelers used, however, were not reported in the NR. I used a SG of 2.70 for the block, while the modelers used 3.0 for diorite blocks and 2.70 for others. My calculations yielded 48.7MM tonnes of material while the modelers came up with only 6.3MM tonnes or fully 1/8 of the entire block. While I attempted to adjust for uncertainty by applying a 50% discount at the end of my process, such a large difference in initial tonnage suggests that the thicknesses and depths used by the modelers was VERY conservative. Rather than allowing the model to extrapolate between holes it looks like the modelers used a narrow band around each hole - a VERY conservative approach. Interesting this conservatism by the modelers since the deposit is classified as a mesothermal deposit - meosthermal deposits are know for their consistency of concentration across a deposit. This suggests to me that with a less conservative application of the model and some in-fill drilling, the resource numbers will increase. In addition, I used an average grade of 1.29 gpt in making my estimate. That number was derived by taking the reported concentrations of each mineral intersection times the length, summing those individual numbers and divining by the total lengths. For the modelers to come up with a concentration of 0.2 gpt suggests that the modelers averaged known concentrations across the entire block as "an average." To test this theory, I substituted the block's over all thickness of 140 m for each of the individual thicknesses reported and then applied the rest of my method. This exercise yields an average concentration of 0.286 gpt. Seems to support my contention of spreading or "smearing" the concentration across a wider thickness by the modelers. [or it could be coincidental results] So overall, after careful examination of the results it appears as though the modelers made several very conservative assumptions about the Thor Trend deposit. Those assumptions appear to have biased the results lower by a significant factor. Sure looks like the company has plans to better prove the capability of the deposit - as they appear to have initiated plans to bulk sample the deposit. Real life extraction of gold from real rocks can go a long way toward reversing "conservative assumptions" imposed by the modeling Geo. This looks like a positive step. In addition with several gold mills in close proximity it should not take much effort to test some bulk tonnage samples. All fwiw - the price you paid for it.... H3

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