Notes On Mineral Inventory Estimation

Notes on Mineral Inventory Estimation
Draft
Draft Date: January 20, 2016
Table of Contents
1 Introduction ....................................................................................................................... 3
1.1 Basic Principles of Mineral Inventory Estimation .................................................... 4
1.1.1 Arithmetic Average ........................................................................................... 4
1.1.2 Weighted Average ............................................................................................ 4
1.1.3 Weighted Average Example Calculation .......................................................... 5
1.1.4 Sample Weighting Factors ................................................................................ 6
1.2 Tonnage Factor ......................................................................................................... 7
1.2.1 Determining Specific Gravity of Rock ............................................................. 7
1.2.2 Tonnage Factor Calculation .............................................................................. 7
1.2.3 Tonnage Factor Calculation Example............................................................... 7
1.3 True Vein Width Estimation ..................................................................................... 9
2 Sample Weighting, Vertical Vein ................................................................................... 10
2.1 Mining Dilution ...................................................................................................... 11
3 Calculation of Mining Block Average ............................................................................ 12
4 Calculation by Mining Block .......................................................................................... 14
5 Calculation by Polygons ................................................................................................. 15
5.1 Polygon Construction.............................................................................................. 15
5.2 Reserve Calculation By Polygons Example ........................................................... 17
6 Calculation by Triangles ................................................................................................. 20
7 Calculation by the Method of Sections ........................................................................... 23
7.1 Vertical Section With Drill Holes ........................................................................... 24
7.2 Adding Boundaries of Geologic Structures on Vertical Section ............................ 26
7.3 Average Assay Values Along Drill Hole Intercepts ............................................... 27
7.4 Constructing Area of Influence Polygons ............................................................... 28
7.5 Determining the Average Grade for a Section ........................................................ 29
7.6 Determining Volume and Grades from Adjacent Sections..................................... 30
7.6.1 Volumes by the Average End Area Formula .................................................. 30
7.6.2 Volumes by the Midpoint Extension Formula ................................................ 32
8 Block Modeling .............................................................................................................. 34
8.1 Drill Hole Assay Composites.................................................................................. 35
8.2 Inverse Distance Weighting .................................................................................... 37
8.3 Generalized Inverse Distance Weighting................................................................ 38
9 Wire Frame Modeling ..................................................................................................... 41
9.1 Octree Block Model ................................................................................................ 44
1
10 Cutoff Grade ............................................................................................................... 45
10.1 Example 1 ............................................................................................................... 45
10.2 Example 2 ............................................................................................................... 46
10.3 Example 3 ............................................................................................................... 46
11 Grade Tonnage Curve ................................................................................................. 47
12 Reporting Exploration Information, Resources & Reserves....................................... 50
12.1 Definitions............................................................................................................... 51
13 References ................................................................................................................... 54
Appendix 1. Working With ASCII Format Drill Hole Data Files ......................................... 55
Drill hole data file description ............................................................................................ 55
Drill hole file header ........................................................................................................... 55
Drill hole collar record ........................................................................................................ 56
Drill hole assay records ....................................................................................................... 56
Example drill hole data file ................................................................................................. 57
Definition of Azimuth and Plunge ...................................................................................... 58
Calculating coordinates along a drill hole .......................................................................... 59
2
1 Introduction
A mineral inventory is a formal quantification of minerals in place.
It is usually achieved by dividing the deposit into geometric shapes (blocks) for which
mineral values are estimated from available samples by a variety of estimation techniques.
Grade estimation data are often obtained from drill hole assays.
Rock volumes for which attributes are estimated are usually orders of magnitude larger than
the sample volumes used in estimates.
The quality of a mineral inventory depends factors such as:

how much is known about the deposit
how extensively it has been sampled
the block grade estimation techniques used
knowledge and skill of management and staff
A mineral inventory makes no presumptions about the mineability of the deposit.
Various international standards have been developed to define mineral inventory reporting
procedures, and there is industry consensus on defining:
Reserves (ore): that part of the mineral inventory that is known with a high degree of
certainty and based on an economic feasibility study that demonstrates mineability.
Resources: that part of the mineral inventory that is less well known and where
economic viability has not yet been established.
Mineable reserves are usually expressed as tons and grades.
The mineral inventory might also be considered in terms of:
The geologic Resource
The mining Reserves or economic portion of the geologic Resource (ore)
Run of Mine grades and tons for the mined ore material with actual mining dilution
3
1.1 Basic Principles of Mineral Inventory Estimation
Mineral inventory estimation involves the calculation of the amount of material contained in
blocks of various sizes and shapes, as well as the average grades of the various minerals
contained therein. For mining purposes, reserves are usually presented as block tons and
average grades.
All methods for the calculation of mineral inventory make use of two basic principles:
1) Samples taken close to each other are likely to have the same value,
(spatial correlation), and
2) Average grades are calculated using some form of a weighted average.
1.1.1 Arithmetic Average

The arithmetic average (), or mean, of a set of samples is calculated as:
1 n 1
=
n i =1
x i , or in abbreviated notation used in this note as: = x i
n
where:
xi = the measured value for sample i
n = the number of samples
With the arithmetic average, samples contribute equally to the average, that is, they all have
the same weight.
1.1.2 Weighted Average

The weighted average ( x ) for sample variable (x) is written as:
x i w i
x=
w i
where:
xi = the measured value for sample i
wi = the weight applied to sample i
With the weighted average, some samples contribute more to the average than others.
Various techniques can be used to determine sample weights to be applied.
4
1.1.3 Weighted Average Example Calculation
Figure 1.1 shows the location and assay values, in ounces of gold per ton, (oz. Au/ton),
collected by channel sampling across a vein intersecting the back (roof) of a mine drift.
Sample Length Assay Value

Interval (ft) (oz. Au/ton)
A-B 0.6 1.09
B-C 1.6 0.50
C-D 1.3 0.13
Sum 3.5
Figure 1.1. Channel sample location and associated data.
Using an arithmetic average, the average grade () would be calculated as:
x i 1.09 + 0.50 + 0.13

= = = 0.57 oz. Au/ton
n 3
In the above calculation, each sample is given equal weight. The highest-grade sample, 1.09
(oz. Au/ton) is defined over the shortest sample interval, and since it is given equal weight, it
biases the average grade higher.
Using a weighted average whereby the sample assay values (A) are weighted by the sample
lengths (L), the average grade would be calculated as:
A i L i (1.09 * 0.6) + (0.50 * 1.6) + (0.13 * 1.3)

A= = = 0.46 oz. Au/ton
L i 0.6 + 1.6 + 1.3
In this case, each sample weight is proportional its length, and the average grade calculated is
lower than that found with an arithmetic average. Intuitively, for reserve calculations, the
weighted average is a better estimate for samples of different lengths.
5
1.1.4 Sample Weighting Factors
In mineral inventory applications, samples are often weighted with geometric factors such
lengths, areas, or volumes, or some other logical value (such as tons when averaging grades
of materials of different densities). Figure 1.2 summarizes.
1-D distance
Weights
commonly used in
weighted average
calculations: 2-D area
x i w i 3-D volume
x=
w i
Weights based
Other on some logical
criteria, s.a. tons.
Figure 1.2. Weighting commonly used in mineral inventory calculations.
6
1.2 Tonnage Factor
The tonnage factor provides a means for the conversion from volume of material, usually
rock, to weight of material. In the English system of units, the tonnage factor is normally
expressed as cubic feet per ton (ft3/ton). In the metric system, the tonnage factor is the
specific gravity (SG) of the material.
The tonnage factor is dependent upon the specific gravity of the rock, which in turn is a
function of the specific gravity of its mineral composition.
1.2.1 Determining Specific Gravity of Rock

Probably the most accurate method of determining specific gravity of rock is to calculate an
average specific gravity using the specific gravities of individual minerals (Table 1.1),
provided the relative percentages by volume of minerals present are accurately known. For
example, if the volume percentages in a massive sulfide are 10% galena, 35% sphalerite, and
55% pyrite, the specific gravity assuming a 100-cm3 total sample volume would be:
7.6 (g/cm3) * 10 (cm3) = 76.0 g galena

4.1 (g/cm3)* 35 (cm3) = 143.5 g sphalerite
5.0 (g/cm3)* 55 (cm3) = 275.0 g pyrite
494.5 g total
Density = 494.5 (g) / 100 (cm3) = 4.95 (g/cm3); SG = 4.95
The specific gravity of a rock may also be calculated by weighing a core or specimen of the
rock in air (Wa) and then weighing the same sample suspended in water (Ww). The specific
gravity is calculated by the following formula:
SG = Wa /(Wa Ww)
A third method of calculation is to measure the volume of an excavation and weigh the
material extracted. The tonnage factor is simply the volume in cubic feet divided by the tons.
1.2.2 Tonnage Factor Calculation

If the material volume has been computed in cubic meters, the volume multiplied by the
specific gravity is the tonnage in metric tons directly.
If working in the English system of units, the tonnage factor is calculated as follows:
Tonnage Factor (ft3/ton) = (2000 lb/ton)/(SG * 62.5 lb/ ft3 water)
1.2.3 Tonnage Factor Calculation Example

If a porphyry copper has a specific gravity of 2.8, then tonnage factor in the English system
of units is:
Tonnage Factor = (2000 lb/ton)/(2.8 * 62.5 lb/ ft3) = 11.4 ft3/ton
7
Dividing the cubic feet of material by the tonnage factor yields the short tons of material.
Using a tonnage factor of 11.4 ft3/ton, the tons represented by 1500 ft3 of ore material is:
1500 (ft3)/11.4 (ft3/ton) = 132 tons
Table 1.1. Specific Gravity of Common Rocks and Minerals, (Readdy, et. al., 1982)
Rocks Minerals Minerals cont.
Andesite 2.4 2.8 Anhydrite 2.9 Gold 17.5
Basalt 2.7 3.2 Anglesite 6.3 Graphite 2.2
Diabase 2.8 3.1 Argentite 7.3 Gypsum 2.3
Dolomite 2.7 2.8 Arsenopyrite 6.0 Hematite 5.2
Gabbro 2.9 3.1 Barite 4.5 Molybdenite 4.8
Granite 2.6 2.7 Bauxite 4.5 Muscovite 2.9
Gravel (dry) 1.6 2.0 Bornite 4.9 Pentlandlte 4.8
Limestone 2.7 2.8 Calcite 2.7 Platinum 19.0
Rhyolite 2.2 2.7 Cassiterite 7.0 Pyroxene 3.3
Sandstone 2.0 3.2 Cerussite 6.5 Pyrite 5.0
Shale 1.6 3.0 Chalcedony 2.6 Pyrrhotite 4.7
Schist 2.6 3.0 Chalcocite 5.7 Quartz 2.7
Chalcopyrite 4.3 Scheelite 6.0
Chromite 4.5 Sericita 2.6
Copper 8.8 Silver 10.6
Covellite 4.6 Smithsonite 4.4
Cuprite 6.0 Sphalerlte 4.1
Feldspar 2.6 2.8 Stibnite 4.6
Fluorite 3.1 Sulfur 2.1
Galena 7.6 Uraninite 9.4
8
1.3 True Vein Width Estimation
Figure 1.3a shows two vertical drill holes that intersect a vein structure. In each drill hole,
the length of the vein intercept (I) is 20 units. Depending on the angle between the vein
structure and the drill hole, a single drill hole vein intercept length can significantly
overestimate the true width of a vein.
(a) (b)
Figure 1.3 Two vertical drill holes intersecting a vein structure.
Given additional information regarding the geometry of the vein structure, it is possible to
estimate the true width (thickness) of the vein.
Figure 1.3b shows the estimate of the vein geometry through the two drill holes shown in
Figure 1.3a. The horizontal distance (dx) between the drill holes is 400 units. The vertical
distance (dy) between the start of the vein intercepts on the two drill holes is 330 units. The
estimated plunge angle () of the vein can be calculated by:
= arctan(dy/dx) = arctan(330/400) = 39.52
The estimated true width of the vein (Wv) can be found by:
Wv = I * cos( ) = 20 * cos(39.52) = 15.43 units
9
2 Sample Weighting, Vertical Vein
Figure 2.1 shows a plan view of a series of samples collected from a vertical vein exposure
along a horizontal drift within an underground lead-silver mine. To obtain the true vein
width, which is required for area and tonnage calculations, samples were collected at right
angles to the strike of the vein. If it is not possible to collect samples across the true width of
a vein, the measured width must be corrected to the true width by a trigonometric calculation.
Figure 2.1. Sample locations for vertical vein reserve calculation example.
Samples are often collected at regular intervals with the interval dependent on the nature of
the mineralization. Erratic mineralization, such as is common in epithermal deposits, requires
sampling at much closer spacing than more regular deposits. In this example, samples are at
irregular spacing to illustrate the principal of weighting by the area of influence.
For each sample, Table 2.1, part a), lists the X coordinate, width (W), the lead (%Pb), and
silver (oz Ag/ton) assay values. Part b) of Table 2.1 lists calculated values used to determine
tons and average grades.
Table 2.1. Sample X coordinate, width, and the lead and silver assay values for the vertical vein
reserve calculation example, part a, and calculated values, part b.
a) b)
Sample X Width %Pb Ag Length (L) Area (A) %Pb *A Ag *A
(ft) (W) (ft) (oz/ton) (ft) (L*W) (ft2)
S-1 10 8.5 6.7 11.3 20 170.0 1139.0 1921.0
S-2 30 7.5 7.8 14.7 26 195.0 1521.0 2866.5
S-3 62 5.5 5.6 8.6 33 181.5 1016.4 1560.9
S-4 96 7.5 8.3 12.9 42 315.0 2614.5 4063.5
S-5 146 6.5 8.8 13.7 34 221.0 1944.8 3027.7
S-6 164 8.5 6.4 10.8 18 153.0 979.2 1652.4
sum 173 1235.5 9214.9 15092.0
Average Grade Pb =
A * (%Pb)
i i
=
9214.9
= 7.5 %Pb
A i 1235.5
Average Grade Ag =
A * (oz Ag/ton)
i i
=
15092.0
= 12.2 oz Ag/ton
A i 1235.5
Average Width =
L i * Wi =
1235.5
= 7.1 ft
Li 173
10
The sample length of influence (L) is assumed to extend half way to the adjacent samples.
For the samples at the ends of the data set, the length of influence is assumed to extend the
same distance on either side of the sample. The sample area of influence (A) is the length
times the width. Sample assay grades are weighted by their area of influence to obtain the
average grades, and sample widths are weighted by their length to obtain the average width.
2.1 Mining Dilution

Dilution can be broadly defined as material of little or no value (waste) that is mined together
with the ore during extraction. There are many causes to dilution including orebody
geometry, mining method, and extraction equipment. In underground mining, dilution is
often 10 to 20 percent. Wall rock, or other sources of dilution, will frequently have a lower
density than mineral bearing metallic sulfides, and calculations of the effect of dilution must
account for this difference in densities.
The example that follows illustrates how waste rock dilution affects the average grade of the
material mined. Using the previous example, assume that the minimum mining width is 8 ft
in order to accommodate the mines excavation equipment. Assume that the tonnage factor
for the vein material (TFo) is 9 ft3/ton and the tonnage factor for the wallrock (TFw)is 12
ft3/ton, and that the waste material mined (dilution) has no mineralization. Table 2.2 shows
the pertinent calculations for determining average grades and percent dilution under these
conditions.
Table 2.2. Calculation of tonnage, average grades, and dilution from a minimum mining width.
Sample Length (L) Width Ore Width Waste Area Ore (Ao) Area Waste (Aw)
(ft) (Wo) (ft) (Ww) (ft) = L * Wo (ft) = L * Ww (ft)
S-1 20 8.5 0.0 170.0 0.0
S-2 26 7.5 0.5 195.0 13.0
S-3 33 5.5 2.5 181.5 82.5
S-4 42 7.5 0.5 315.0 21.0
S-5 34 6.5 1.5 221.0 51.0
S-6 18 8.5 0.0 153.0 0.0
sum 1235.5 167.5
Tons of vein material per vertical foot is: To = (Ao*1)/TFo = (1235.5ft2 * 1 ft)/(9 ft3/ton) = 137.3 t/ft
Tons of waste material per vertical foot is: Tw = (Aw*1)/TFw =(167.5ft2 *1 ft)/(12 ft3/ton) = 14.0 t/ft
The total tons per vertical foot is: Tt = To + Tw = (137.3 + 14.0) tons/ft = 151.2 t/ft
To * G Pb + Tw * G w 137.3 * 7.5 + 14.0 * 0.0

The average lead grade is: G Pb = = = 6.8%Pb
To + Tw 137.3 + 14.0
To * G Ag + Tw * G w 137.3 * 12.2 + 14.0 * 0.0

The average silver grade is: G Ag = = = 11.1%Ag
To + Tw 137.3 + 14.0
The % Dilution is: D = (Tw / Tt)*100 = (14.0/151.2) *100 = 9.2 % Dilution
11
3 Calculation of Mining Block Average
Figure 3.1 depicts a vertical section through an underground mine, with a mining block
(stope) isolated by two horizontal levels and two vertical raises, (Parks, 1957). The 75 ft
long by 50 ft high mining block covers a near vertical section of a vein, with sampling across
the vein at locations A through N. Older mining methods such as shrinkage stoping might
result in mining blocks and sampling along levels and raises as depicted in the figure. The
block is divided into four geometric regions labeled R1 through R4. The procedure outlined
below can be used to calculate the total tons and average grade for the block.
Figure 3.1. A series of eight 50 ft high by 75 ft long mining blocks (stopes) showing the average
width and average grade in oz. Ag/ton.
Step 1 in the calculation procedure is to determine the areas represented by regions R1

through R4 using the block length (L) and the block height (H). The areas for regions R1 and
R3 can be calculated by:
H H 50 50 2
AR 1 = L = 75 = 1250ft
2 2 2 2
The areas for regions R2 and R4 can be calculated by:
2 2
H 50
AR 2 = = = 625ft 2
2 2
Step 2 in the calculation procedure is to find the average grade and average width along each
face of the mining block using a procedure similar to that shown in Chapter 2. Table 3.1
gives the sample data and calculated values for the uppermost face (1) of the block using
12
samples A through D. A similar procedure is used to find the average grade and average
width along each of the remaining faces.
Table 3.1. Sample values for face 1, including sample ID, sample width, grade, interval of
influence, and calculation of average width and average grade for the face.
Sample Width (W) Grade (G) Interval (I) Area (A) A*G
ID (ft) %Zn (ft) =W*I
A 8.5 4.2 16 136.0 571.2
B 7.5 6.8 19 142.5 969.0
C 5.5 5.6 22 121.0 677.6
D 7.5 5.2 18 135.0 702.0
Sum 75 534.5 2919.8
Average Width =
W *I i i
=
534.5
= 7.1 ft
W i 75
Average Grade Zn =
A *G i i
=
2919.8
= 5.5 %Zn
A i 534.5
The third step in the calculation procedure is to find the volume represented for each region,
and then using the appropriate tonnage factor, in this case 9.5 ft3/ton, determine the tons in
each region, and finally the total tons and average grade for the block. Table 3.2 gives the
calculated values for each region and for the block totals.
Region Area Width Grade Volume Tons (T) Tons * Grade Width*
(ft2) (W) (ft) (%Zn) Area
R1 1250 7.1 5.5 8908.33 937.72 5122.4561 8908.33
R2 625 7.4 5.8 4612.50 485.53 2814.8684 4612.50
R3 1250 8.2 7.3 10258.33 1079.82 7910.0000 10258.33
R4 625 6.9 8.5 4312.50 453.95 3841.7105 4312.50
sum 3750 28091.67 2957.02 19689.0351 28091.67
Average Grade Zn =
T * (%Zn) i i
=
19689.0351
= 6.7 %Zn
T i 2957.02
Average Width =
Volume i
=
28091.67
= 7.5 ft
W i 3750
The average width for the mining block is 7.5 ft, and the reserves for the block would be
reported as 2957 tons with an average grade of 6.7%Zn.
13
4 Calculation by Mining Block
Figure 4.1 depicts a series of mining blocks (stopes) located along a vertical vein in an
underground mine. This very simplified layout shows mining blocks separated by horizontal
drifts on three levels, and by vertical raises and an access shaft. The block size is 50 ft high
by 75 ft long. The upper number in each block is the average vein thickness within the
block, and the lower number is the average silver grade in oz/ton.
Figure 4.1. A series of eight 50 ft high by 75 ft long mining blocks (stopes) showing the average
width and average grade in oz. Ag/ton.
Table 4.1 summarizes the reserve calculation for the series of blocks. The block volume is
found by multiplying the block length, height, and width. The tons per block are found by
dividing the volume by the tonnage factor of 9 ft3/ton. The average grade is found by
weighting the block grades by the block tons.
Table 4.1. Calculation of tonnage, and average grade for a set of mining blocks.
Length (L) Height (H) Width (W) Volume Tons = Grade Grade * Tons
(ft) (ft) (ft) (V) (ft3) V*TF (oz Ag /ton)
75 50 8.0 30000 270000 12.0 3240000.0
75 50 9.5 35625 320625 16.0 5130000.0
75 50 8.5 31875 286875 20.0 5737500.0
75 50 10.0 37500 337500 15.0 5062500.0
75 50 8.5 31875 286875 16.0 4590000.0
75 50 10.0 37500 337500 18.0 6075000.0
75 50 9.0 33750 303750 11.0 3341250.0
75 50 9.5 35625 320625 17.0 5450625.0
173 173 273750 2463750 38626875.0
Average Grade =
Tons i * Grade i 138626875
= = 15.7 oz Ag/ton
Tons i 2463750
The reserves for the block would be reported as 2957 tons with an average grade of 6.7%Zn.
Although the example is simplified, the same basic procedure for finding total tons and
average grades could be used in more complex geometries involving mining block of various
sizes and shapes.
14
5 Calculation by Polygons
The polygon method of reserve calculation is sometimes applied with drill hole data due to
its relative ease of calculation compared to other more advanced reserve calculation methods.
Polygons may be constructed in plan view or in vertical sections. Using the drill hole
locations, an area of influence polygon is constructed around each drill hole, (Fig 5.1). The
reserve polygons have the property that every point within a polygon is closer to the defining
drill hole than any other drill hole in the data set. Furthermore, when properly constructed,
the polygons for a given set of drill hole data are unique.
The average grade of mineralization within the drillhole is considered to accurately represent
the grade of the entire volume of material within the polygon. The polygon area is multiplied
by the mineralized interval or thickness above a cutoff grade to obtain a volume. The
volume is converted to tons using the appropriate tonnage factor. The total tons and average
grade for the deposit is then calculated using a weighted average.
Figure 5.1 Reserve polygons example and underlying triangulation.
5.1 Polygon Construction

The polygon geometric structure has been widely studied in other engineering disciplines
such as the computer sciences, and a number of algorithms for its construction have been
developed. The polygons represented by a set of sample locations are often referred to as
the Voronoi Diagram and the underlying triangulation (geometric dual) is often referred to
15
as the Delaunay Triangulation. The polygons are convex, and the centers of the circles that
circumscribe each triangle provide the polygon vertices.
Reserve polygons can be calculated using computer software developed for this purpose, by
hand, or by a computer assisted hand method using a CAD program. Where a computer
algorithm is used, the polygon areas can usually be obtained by the software. When
constructed by hand, the polygon areas can be measured using a planimeter device or
calculated geometrically by breaking each polygon in to a series of triangles.
The polygon method assumes that the area of influence of any sample point extends halfway
to the adjacent sample points. The procedure for construction of polygons by hand using six
drill holes is illustrated in Figure 5.2. The steps in the procedure are:
Step a: accurately plot the positions of the drill holes using an appropriate scale factor.
Step b: draw a segment connect the drill hole to the nearest adjacent drill holes.
Step c: construct the perpendicular bisectors of the segments constructed in step b.
Step d: extend the adjacent perpendicular bisectors to the points of intersection to obtain the
completed polygon.
Figure 5.2. Polygon Construction with (a) six drill holes, (b) connecting lines for the drill holes,
(c) the construction of perpendicular bisectors of the lines between adjacent drill holes, and (d)
the final polygon.
16
Once the first polygon is completed, the process is continued for the remaining drill holes.
When completed, the construction segments used in connecting adjacent drill holes forms the
underlying triangulation.
Often when constructing by hand, it is not clear which neighboring drill holes should be
used. If an incorrect choice is made, this is usually discovered when constructing adjacent
polygons, and the choices of segments forming the underlying triangulation can be altered
until the correct polygons are formed. Each polygon must be convex.
Closed polygons for the perimeter holes cannot be completed using the procedure outlined
above. For perimeter polygons, a closed polygon can be obtained by adding a circular arc as
illustrated in Figure 5.2 above. The arc radius is arbitrary, and often the average drill hole
spacing is used. Other means of completing the perimeter polygons might include extending
the polygons to a fault line or a property boundary.
5.2 Reserve Calculation By Polygons Example

For bookkeeping purposes, polygons are conveniently referenced to the drill hole number
and the section or level being evaluated, e.g., polygon DDH-8-16, level 2080. Figure 5.3
illustrates the computation of a reserve area by the polygon method for the Bonanza copper
deposit. In this example, the mineralization is assumed to be copper, and the cutoff grade is
0.40% Cu. The perimeter polygons D-1, D-5, D-6, D-10, D-14, D-15, D-16, D-17, and D-18
contain no mineralization above cutoff grade, and are used only for the construction of the
interior polygons. A horizontal fault is located at the bottom of the figure and is used to
bound the size of polygons D-2, D-3, and D-4.
Figure 6.7. Diamond drill hole plan and polygons for the Bonanza copper deposit.
17
The average grade and thickness of the mineralized zone for each drill hole may be
determined using a weighted average as shown in Table 5.1 for drill hole D-2. The
interval length for each mineralized zone is measured starting from the drill hole collar.
The thickness of each interval is calculated by subtracting the interval start from the
interval end distance. The assay grades are weighted by the respective interval thickness and
the average grade for the composite interval as show.
Table 5.1. Interval Thickness and Average Grade Calculation for Drill Hole D-2
Thickness Grade
Interval (ft) Grade * Thickness Comment
(ft) % Cu
0-100 100 0.31 Below Cutoff
100-110 10 0.47 4.70
110-122 12 0.72 8.75
122-130 8 0.96 7.68
130-150 20 1.04 20.80
150-200 50 0.82 41.00
200-220 20 0.54 10.80
220-250 30 0.42 12.60
250-270 50 0.35 Below Cutoff
Sum 150 106.43
Average Grade Drill Hole D 2 =

Thichness * Grade
i i
=
106.43
= 0.71%Cu
Thickness i 150
The interval thickness and average grade for each drill hole is calculated in a similar fashion
as illustrated in Table 5.1.
The volume of mineralized material for each polygon is found by multiplying the interval
thickness by the polygon area. The volume can be converted to tons using the appropriate
tonnage factor.
The reserves for the deposit in the form of the total tons and average grade can be found by
summing the tons represented by each polygon. The average grade for the deposit can be
calculated by weighting each polygon average grade by the respective polygon tons as
illustrated in Table 5.2.
18
Table 5.2. Total Reserves for the Bonanza Copper Deposit
Area Thickness Volume Tonnage Grade Tons *
Polygon Tons
(ft2) (ft) (ft3) Factor % Cu Grade
D-2 5320 150 798,000 12.5 63,840 0.71 45,326
D-3 5300 135 715,500 12.5 57,240 0.66 37,778
D-4 4400 180 792,000 12.5 63,360 0.82 51,955
D-7 5520 175 966,000 12.5 77,280 0.75 57,960
D-8 6800 155 105,400 12.5 84,320 1.00 84,320
D-9 4960 180 892,800 12.5 71,424 0.97 69,281
D-11 4520 250 1,130,000 12.5 90,400 1.21 109,384
D-12 4640 240 1,113,600 12.5 89,088 1.36 121,159
D-13 5840 150 876,000 12.5 70,080 0.93 65,174
Sum 667,032 642,339
Average Grade Entire Deposit =

Tons * Grade
i i
=
642,339
= 0.96 %Cu
Tons i 667,032
For the Bonanza deposit, the total tons represented by the reserve polygons is 667,032 tons
with an average grade of 0.96 %Cu.
Note that since in this example the tonnage factor is the same for each polygon, the average
grade could also be calculated by weighting with the polygon volumes instead of tons, and
the total tons could be calculated by dividing the total volume by the tonnage factor.
19
6 Calculation by Triangles
The triangle method of reserve calculation is closely related to the polygon method discussed
in the previous section. The Voronoi Diagram, usually referred to as polygons when used
for reserve calculations, is the geometric dual of the Delanuay Triangulation. In this
method, the drill area is divided into triangles by connecting adjacent drill holes with
construction lines. Triangles may be constructed in plan view or in vertical sections. The
area for each triangle is calculated, and an average mineralized zone thickness is found by
averaging the values at the three triangle vertices. Using the appropriate tonnage factor, the
tons represented by the triangle can then be found. Average grades are calculated for each
triangle by a weighted average using the thickness at the three triangle vertices to weight the
respective assay values. Once the appropriate values are calculated for each triangle, the
total reserves for the deposit can be calculated.
Figure 6.1 shows a series of triangles that are used in the reserve calculation example for the
Big Deal Copper Deposit. The average grade and thickness of the mineralized zone above
cutoff for each drill hole may be determined as shown in Table 5.1 in the previous section.
The composite data for the drill holes used in this example is shown in Table 6.1.
Figure 6.1. Triangle construction from drill hole locations for the Big Deal Copper Deposit.
20
Table 6.1. Drill hole coordinates and composite data for the Big Deal Copper Deposit.
X Y Thickness Grade
Drill Hole
(ft) (ft) (ft) (% Cu)
D-2 290 70 50 0.93
D-3 215 75 75 0.77
D-7 180 130 60 0.82
D-8 265 120 100 1.05
D-9 365 105 75 0.72
D-10 405 175 60 0.49
D-11 310 190 105 1.63
D-12 220 190 80 0.91
D-13 175 190 70 0.86
D-17 225 255 55 0.79
D-18 355 240 75 0.74
The calculations performed for triangle T1 are shown in Table 6.2 below. The triangle area is
found by the absolute value of the determinant of the coordinates of the vertices. The
average thickness is found by averaging the values at the three vertices, and the average %Cu
grade is found by a weighted average whereby the grades are weighted by the respective
average thickness. The triangle tons are found by multiplying the area by the average
thickness, and then dividing by the appropriate tonnage factor (TF). The tonnage factor used
for the Big Deal Copper Deposit is 12.5 ft3/ton.
Table 6.2. Area, average thickness, average %Cu grade, and tons calculations for triangle T1
of the Big Deal Copper Deposit.
X Y Thickness Grade Grade *
Drill Hole
(ft) (ft) (ft) (% Cu) Thickness
D-2 290 70 50 0.93 46.5
D-8 265 120 100 1.05 105.0
D-9 365 105 75 0.72 54.0
Sum 225 205.5
1
Area = (X 2 - X 3 ) * Y1 + (X 3 - X 1 ) * Y2 + (X1 - X 2 ) * Y3 =
2
1
= (265 365) * 70 + (365 290 ) * 120 + (290 265) * 105 = 2,312.5 ft 2
2
Average Thickness =
Thickness i
=
225
= 75 ft
3 3
Average Grade =
Thickness * Grade
i i
=
205.5
= 0.91%Cu
Thickness i 225
Area * Thickness 2312.5 * 75
Tons = = = 13,875 tons
Tonnage Factor 12.5
21
The area, average thickness, tons, and average grade calculated for each triangle is given in
Table 6.3. From this information, the total tons in the deposit is found by summing the tons
for each triangle, and a weighted average is used to calculate the average grade for the
deposit by weighting the triangle average grades by the respective triangle tons.
Table 6.3. Total Reserves for the Big Deal Copper Deposit.
Area Thickness Grade
Triangle Drill Holes Tons Tons * Grade
(ft2) (ft) % Cu
T-1 D-2, D-8, D-9 2312.5 75.0 13,875 0.91 12626.25
T-2 D-2, D-3, D-8 1825.5 75.0 10,875 0.93 10113.75
T-3 D-3, D-7, D-8 2162.5 78.3 13,552 0.90 12196.80
T-4 D-9, D-11, D-10 3625.0 80.0 23,200 1.06 24592.00
T-5 D-9, D-8, D-11 3837.5 93.3 28,653 1.18 33810.54
T-6 D-8, D-12, D-11 3150.0 95.0 23,940 1.22 29206.80
T-7 D-8, D-7, D-12 2750.0 80.0 17,600 0.95 16720.00
T-8 D-7, D-13, D-12 1350.0 70.0 7,560 0.87 6577.20
T-9 D-10, D-11, D-18 2712.5 80.0 17,360 1.07 18575.20
T-10 D-11, D-17, D-18 3587.5 78.3 22,482 1.15 25854.30
T-11 D-11, D-12, D-17 2925.0 80.0 18,720 1.20 22464.00
T-12 D-12, D-13, D-17 1462.5 68.3 7,995 0.86 6875.70
Total 31700.5 205,812 219612.54
Average Grade =
Tons * Grade
i i
=
205,812
= 1.07 %Cu
Tons i 219,612.54
As summarized in Table 6.3, the total reserves for the Big Deal Copper Deposit are 205,815
tons with an average grade of 1.07 %Cu.
22
7 Calculation by the Method of Sections
The method of sections approach for determining mineral inventory involves calculating the
grade and tons of a block of ore bounded by a series of cross sections. The sections are
constructed from drill hole data. On each section, the boundaries of the mineralized region
and average grade are determined. The total volume and average grade for a larger block is
then determined by averaging data from adjacent sections.
The method of sections is illustrated using data from a hypothetical iron deposit. The
mineralization occurs as a single approximately 50-meter wide vein, and is characterized by
sharp boundaries between the mineralized vein material and the host rock. The data set
consists of three vertical sections, with three diamond drill holes lying within the plane of
each section.
The basic steps involved in the calculation of reserves by the method of sections are:
1. Create vertical sections with drill hole data (rock types and assay values)
2. On each section, construct the boundaries of the mineralized zones.
3. Calculate average assay values along drill hole intervals
4. Construct area of influence polygons for each drill hole
5. Determine the total area and average grade for each section
6. Determine the volume and average grade for the material represented by each section
7. Determine the total volume, tones and average grade for all sections included
23
7.1 Vertical Section with Drill Holes
Figure 7.1 shows a vertical section through the deposit with drill holes and assay values
(%Fe) for assayed segments along each. The drill hole data used is listed in Table 7.1.
Figure 7.1. Vertical section through a hypothetical iron ore deposit.
24
The upper section of Table 7.1 lists the drill hole ID, the collar X, Y, and Z coordinates in
meters, the strike direction in degrees, the plunge angle in degrees, and the length of the drill
hole in meters. The lower portion of the table lists data for the assayed intervals along each
drill hole, which consists of the hole ID, the start and end lengths of the assayed interval in
meters, and the grade in %Fe.
Table 7.1. Drill hole data for section shown in Figure 7.1.
Hole Collar X Collar Y Collar Z Strike Plunge Length
ID (m) (m) (m) (Degrees) (Degrees) (m)
DDH2 500.0 2025.0 600.0 90.0 10.0 195.0
DDH3 500.0 2025.0 600.0 90.0 -10.0 197.0
DDH4 500.0 2025.0 600.0 90.0 -25.0 220.0
Hole Interval Interval Grade

ID Start End (%Fe)
DDH2 139.0 144.0 55.0
DDH2 144.0 152.0 58.0
DDH2 152.0 166.0 55.0
DDH2 166.0 173.0 63.0
DDH2 173.0 184.0 65.0
DDH3 136.0 146.0 52.0
DDH3 146.0 154.0 50.0
DDH3 154.0 162.0 60.0
DDH3 162.0 168.0 63.0
DDH3 168.0 176.0 55.0
DDH3 176.0 179.0 58.0
DDH3 179.0 188.0 67.0
DDH4 141.0 149.0 60.0
DDH4 149.0 157.0 57.0
DDH4 157.0 165.0 62.0
DDH4 165.0 173.0 59.0
DDH4 173.0 182.0 61.0
DDH4 182.0 189.0 64.0
DDH4 189.0 196.0 61.0
25
7.2 Adding Boundaries of Geologic Structures on Vertical Section
Figure 7.2 shows the section from Figure 7.1 with boundaries of the mineralized zone
overlain on the drill holes. The start of the first assayed interval and the end of the last
assayed interval provide the intercepts of these boundaries along each drill hole. The start
and end intervals for adjacent drill holes are connected by straight line segments. The
boundary lines have arbitrarily been extended upward to the 650 m elevation and downward
to the 500 m elevation.
Figure 7.2. Vertical section through an iron deposit with mineralized zone boundaries shown.
26
7.3 Average Assay Values Along Drill Hole Intercepts
The average of the assay values along the drill hole within the boundary of the mineralized
zone are calculated by a simple weighted average. Table 7.2 shows the calculation for the
data in Table 7.1. In each case, the average grade for the entire assayed interval along the
drill hole is calculated as a weighted average by dividing the sum of the interval lengths (Li)
times the interval assay value in %Fe (Gi) by the sum of the interval lengths.
Table 7.2. Calculation of the total interval length and the average assay values along the
mineralized section of the drill holes.
Hole ID From To Interval Grade (G) L* G
(m) (m) Length (L) (m) (%Fe)
DDH2 139.0 144.0 5.0 55.0 275.0
DDH2 144.0 152.0 8.0 58.0 464.0
DDH2 152.0 166.0 14.0 55.0 770.0
DDH2 166.0 173.0 7.0 63.0 441.0
DDH2 173.0 184.0 11.0 65.0 715.0
sum 45.0 2665.0
DDH2 Average Grade Fe =

L i * G i 2665.0
= = 59.2 %Fe
Li 45
DDH3 136.0 146.0 10.0 52.0 520.0

DDH3 146.0 154.0 8.0 50.0 400.0
DDH3 154.0 162.0 8.0 60.0 480.0
DDH3 162.0 168.0 6.0 63.0 378.0
DDH3 168.0 176.0 8.0 55.0 440.0
DDH3 176.0 179.0 3.0 58.0 174.0
DDH3 179.0 188.0 9.0 67.0 603.0
sum 52.0 2995.0
DDH3 Average Grade Fe =

Li * Gi
=
2995.0
= 57.6 %Fe
L i 52.0
DDH4 141.0 149.0 8.0 60.0 480.0

DDH4 149.0 157.0 8.0 57.0 456.0
DDH4 157.0 165.0 8.0 62.0 496.0
DDH4 165.0 173.0 8.0 59.0 472.0
DDH4 173.0 182.0 9.0 61.0 549.0
DDH4 182.0 189.0 7.0 64.0 448.0
DDH4 189.0 196.0 7.0 61.0 427.0
sum 55.0 3328.0
DDH4
Average Grade Fe =
Li * Gi
=
3328.0
= 60.5 %Fe
L i 55.0
27
7.4 Constructing Area of Influence Polygons
An area of influence polygon is calculated for each drill hole that projects onto the section.
The area of influence for each drill hole is usually considered to extend half way to the
adjacent drill hole. The grade for each area of influence polygon is assumed to be the same
as the average drill hole intercept value as calculated in Section 7.3. Figure 7.3 shows the
vertical section from Figure 7.2 with the area of influence of each drill hole as well as the
average %Fe grade shown.
Figure 7.3. Vertical section through a hypothetical iron ore deposit with area of influence of
each drill hole and average of the drill hole assay values.
The coordinates for polygons representing the area of influence for each drill hole are given
in Table 7.3. The coordinates are listed in a counter clockwise order starting with the upper
left corner of each polygon.
Table 7.3. The X and Z coordinate in meters for the polygons representing the area of influence
for each of the three drill holes shown in Figure 7.3.
DDH2 DDH3 DDH4
X (m) Z (m) X (m) Z (m) X (m) Z (m)
637 650 635 600 632 559
637 624 634 577 628 540
635 600 632 559 628 500
683 600 681 543 678 500
681 632 686 568 678 518
681 650 683 600 681 543
28
The area of polygon A-DDH2 is calculated as one half the absolute value of the determinant
of the X, Z coordinate pairs:
1
A - DDH2 = (X1Z 2 + X 2 Z3 ... + X n Z1 ) (Z1X 2 + Z2 X 3 ... + Zn X1 )
2
1 (637 * 624 + 637 * 600 + 635 * 600 + 683 * 632 + 681* 650 + 681* 650)
=
2 (637 * 650 + 635 * 624 + 683 * 600 + 681* 600 + 681* 632 + 637 * 650)
= 2256 m 2
Similarly, the area of polygons A-DDH3 and A-DDH4 are 2500 m2 and 2606 m2 respectively.
7.5 Determining the Average Grade for a Section

The average grade for the entire section can be calculated using the weighted average of the
individual areas of influence and the drill hole composite assay values. Table 7.4 shows the
calculation for values from the three drill holes in the section shown in Figure 7.3. The
average grade for the entire section is calculated as a weighted average by dividing the sum
of the areas of influence (Ai) times the interval average assay value in %Fe (Gi) by the sum
of the areas of influence.
Table 7.4. Total area and average grade for the drill hole data given in Table 7.3.
Polygon Area (A) Grade (G) A*G
(m2) (%Fe)
A-DDH2 2256.0 59.2 133605.3
A-DDH3 2500.0 57.6 143990.4
A-DDH4 2605.5 60.5 157656.4
Sum 7361.5 435252.2
Average Grade Fe =
A *G
i i
=
435252.2
= 59.1 %Fe
A i 7361.5
29
7.6 Determining Volume and Grades from Adjacent Sections
Once the total area and average grade for each vertical section to be included in the reserves
have been calculated, the total volume and average grade for a block of ore bounded by a
series of vertical sections can be calculated using one of two similar procedures:
the average end area formula, or
the midpoint extension formula.
7.6.1 Volumes and Grades by the Average End Area Formula
Figure 7.4 illustrates the determination of the volumes V1 and V2 by the average end area
formula for three equally spaced sections labeled A1, A2, and A3.
Figure 7.4. Volumes V1 and V2 by the average end area approach for three equally spaced
vertical sections A1, A2, and A3.
The volume V1 is the volume of material between sections A1 and A2, and the volume V2 is
the volume of material between sections A2 and A3. Given a horizontal separation distance
(L), the volume V1 is calculated using the average end area formula as:
V1 = 1/2(A1 + A2) * L
And the volume V2 as:
V2 = 1/2(A2 + A3) * L
The total volume represented by the three sections can then be calculated as:
VT = V1 + V2
30
In general terms, for (n) sections separated by a distance (L) where the areas of the
mineralized zone in each section (A1 .. An) has been calculated, the following equation can be
used for calculating the total volume represented:
VT = (A1 + 2A2 + 2A3 ...An)/2 * L
The volume can be converted to tons by application of the appropriate tonnage factor.
The average grade for each volume is calculated as a weighted average using the grade and
areas from the bounding sections. For this example, the grade for volume V1 is calculate by:
GV1 = [G1*A1 + G2*A2] / [A1 + A2]
The grade for volume V2 is calculated by:
GV2 = [G2*A2 + G3*A3] / [A2 + A3]
Finally, the grade for the entire volume represented by the sections is calculated as a
weighted average using the block volumes and grades. For this example, the average grade
for the volume of material represented by the three sections is:
GT = [GV1*V1 + GV2*V2] / [V1 + V2]
In general terms, for (n) sections separated by a distance (L) where the areas of the
mineralized zone in each section (A1 .. An) has been calculated, the following equation can be
used for calculating the average grade for the total volume represented:
GT = [ (G1A1 + 2G2A2 + 2 G3A3 ...GnAn)] / [(A1 + 2A2 + 2A3 ...An)]
To illustrate the procedure, the values for the vertical section used in this example together
with two similar sections are given in Table 7.5.
Table 7.5. The total volume and average grade %Fe from the areas and grades from three
vertical sections separated by a distance (L) of 50 meters using the average end area formula.
Section Area (A) Grade (G) (%Fe) A*G
(m2)
A1 7361.5 59.1 435252.2
A2 7557.0 61.2 462488.4
A3 6800.0 57.2 388960.0
Total Volume = (A1 + 2A2 + A3)/2 * L
= (7361.5 + 2*7557.0 +6800.0)/2 *50
= 731887.5 m3
Average Grade = (G1A1 + 2G2A2 + G3A3) / (A1 + 2A2 + A3)
= (435252.2 + 2*462488.4 + 388960.0)
/(7361.5 + 2*7557.0 +6800.0)
= 59.7 %Fe
31
Assuming a specific gravity for the mineralized material of 4.5, the total metric tons
represented by the three sections is:
Tones = 731887.5 m3 * 4.5 = 3,293,494 tonnes
For this example, the total reserves are 3,294,000 tonnes with an average grade of 59.7 %Fe.
7.6.2 Volumes by the Midpoint Extension Formula
Figure 7.5 illustrates the determination of the volumes V1, V2, and V3 by the midpoint
extension formula for three equally spaced sections labeled A1, A2, and A3.
Figure 7.5. Volumes V1, V2, and V3 by the midpoint extension approach for three equally
spaced vertical sections A1, A2, and A3.
In each case, the volume Vi is the volume of material represented by the section Ai. In the
general case, the distance between vertical sections may not be constant, and the side lengths
(Li) for each volume (Vi) is calculated from the midpoints between adjacent sections, using a
procedure analogous to that illustrated in Section 2 with the sample weighting for a vertical
vein example.
For this example, the distances between sections is constant and is equal to the section
horizontal spacing distance (L). The volumes represented by the three sections are calculated
as:
V1 = A1 * L
V2 = A2 * L
V3 = A3 * L
The total volume represented is calculated as:
32
VT = V1 + V2 + V3 = Vi
The volume is then converted to tons by application of the appropriate tonnage factor.
The grade for each volume (Vi) is assumed to be the same as that found for the defining
section (Gi), and the average grade for the entire volume is found as a weighted average
using the block grades and volumes as:
GT =GiVi /Vi
To illustrate the procedure, the values for the vertical section used in this example together
with two similar sections are given in Table 7.6.
Table 7.6. The total volume and average grade %Fe from the areas and grades from three
vertical sections separated by a distance (L) of 50 meters using the average end area formula.
Section Area Volume Grade Vi * Gi
(Ai) (Vi =Ai*L) (Gi)
(m2) (m3) (%Fe)
A1 7361.5 368075 59.1 21762608
A2 7557.0 377850 61.2 23124420
A3 6800.0 340000 57.2 19448000
Sum 21718.5 1085925 64335028
Total Volume (VT) = Vi

= 368075 + 377850 + 340000
= 1,085,925 m3
Average Grade (GT) = GiVi /Vi
= 64335028/1085925
= 59.2 %Fe
Assuming a specific gravity for the mineralized material of 4.5, the total metric tons
represented by the three sections is:
Tones = 1,085,925 m3 * 4.5 = 4,887,000 tonnes
For this example, the total reserves are 4,887,000 tonnes with an average grade of 59.2 %Fe.
33
8 Block Modeling
Block modeling involves dividing the deposit into a series of equally sized blocks, and then
calculating the grade and/or other properties for each block. Figure 8.1 shows a cross section
through a block model of a deposit.
Figure 8.1. Three-dimensional block model (MineSight)
The two methods that are commonly used to calculate block values are:
Inverse Distance
Kriging
The Inverse Distance method is described in the section 8.2. Kriging is a geostatistical
procedure, and a brief overview of the method is given in Appendix 1.
Determining the block size is an important consideration and is based on the deposit
characteristics and the intended use for the block model. A good rule of thumb based on
geostatistical procedures is that the block size should not be smaller than one-forth the
average drill hole spacing.
34
8.1 Drill Hole Assay Composites
The calculation of drill hole assay composites involves calculating samples at regular
intervals down the length of a drill hole from the original drill hole assay data. The
calculating of composites can be thought of as re-cutting the drill hole core into equal length
pieces. This is required so that samples will have the same weight or influence when used to
calculate block values. Preprocessing the drill hole data into equal length composites is
required before block modeling using either the Inverse Distance or Kriging methods of
calculating block values.
Figure 8.2. The calculation of bench composites
Figure 8.2 illustrates the concept of calculating composites with a vertical hole. Composites
are calculated using a weighted average of the (n) assays that fall within the composite
interval by the formula:
C=
A *L
i i
L i
where C is the composite value, Aj is the value of assay i, and Li is the length of assay i.
The value of the 40-foot high composite from elevation 1100 to 1140 in Figure 8.2 is
calculated as follows:
C = [55.2 * 8 + 53.1 *12 + 60.2 * 6 + 48.3 *14] / 40 = 52.9
If undefined assays are encountered, they are ignored. For example, if the last assay in this
example were undefined, the value of the 40-foot composite would be calculated as follows:
C = [55.2 * 8 + 53.1 *12 + 60.2 *6] / 26 = 55.4
Figure 8.3 below shows the results of calculating composites for copper assay values at
regular 20-ft intervals down the length of a drill hole.
35
DDH-1 Assays DDH-1 Composites
Feet 0 %Cu Feet 0 %Cu
1.2
1.68
20 20
2.4
2.40
40 40
2.04
1.8
60 60
1.9 1.96
80 80
2.1
2.04
100 100
2.0
1.92
120 120
1.6 1.60
140 140
1.1 1.20
160 160
Figure 8.3. Regular composites calculated from assay data down the length of a drill hole.
36
8.2 Inverse Distance Weighting
The inverse distance squared method (IDS) can be used to calculate values for a regular grid
of block data from irregularly spaced sample data, usually in the form of drill hole assay
composites. The composite values are weighted by the inverse of the square of the distance
from the center of the composite to the center of the block. The basic idea of the method is
that samples close to the center of a block influence the grade of the block more than samples
that are farther away. The inverse distance squared equation is:
Gi
D 2
i
G= (8.2.1)
1
D i2
where G is the calculated block value, Gj is the value of composite i, and Di is the distance
from composite i to the center of the block.
Figure 8.4 shows a block at location G surrounded by six composites. The copper grade in
%Cu is shown next to the sample, and the distance to the center of the block is shown along
the connecting line. The grid size is 100 ft.
Figure 8.4. Sample data used for Inverse Distance Squared example.
Using the data shown in Figure 8.4, the grade in %Cu of the block would be calculated as:
Gi
D 2
0.644
2
0.023 1.365 0.258 0.165 0.409
+ 2
+ 2
+ 2
+ 2
+
G= i
= 255 1 58 212 1 58 292 212 2 = 0.41 %Cu
1 1 1 1 1 1 1
2
Di 255 2
+
258 2
+
212 2
+
158 2
+
292 2
+
212 2
37
Equation 8.2.1 can be rearranged so that individual sample weights are calculated, and the
average grade calculated using an equation with a form that resembles the basic equation for
a weighted average.
The weight (Wi) that each sample grade is multiplied by in Equation 8.2.1 can be written as:
1
D2
Wi = n i (8.2.2)
1
D2
j=1 j
Since the sum of the weights calculated with the equation above equal 1.0, the average grade
can also be calculated as:
G = G i Wi (8.2.3)
The calculation of the average grade for the example data above using the modified inverse
distance squared equation 8.2.3 is summarized in the table below.
Sample (i) Gi (%Cu) Di Di 2 1/ Di2 Wi Gi * W i

1 0.644 255 65025 1.53787E-05 0.1014 0.0653
2 0.023 158 24964 4.00577E-05 0.2640 0.0061
3 1.365 212 44944 2.22499E-05 0.1466 0.2002
4 0.258 158 24964 4.00577E-05 0.2640 0.0681
5 0.165 292 85264 1.17283E-05 0.0773 0.0128
6 0.409 212 44944 2.22499E-05 0.1466 0.0600
Sum 1.51722E-04 1.0000 0.4124 %Cu
The average grade calculated using Equation 8.2.3 is 0.41 %Cu, as was also the value found
in the first example using Equation 8.2.1.
8.3 Generalized Inverse Distance Weighting

Although the exponent used for inverse distance weighting is commonly set to 2, (Inverse
Distance Squared), the method can be applied using other exponents, thereby changing the
relative sample weights as a function of distance. Equation 8.2.1 can be written in general
terms of the exponent (p) as:
G
D pi
i
G= (8.2.4)
1
Dp
i
38
The weight (Wi) that each sample grade is multiplied by in Equation 8.2.4 can be written as:
1
Dp
Wi = n i (8.2.5)
1
Dp
j=1 j
The table below shows the data from the previous example with sample weighting calculated
using exponents of 1, 2, and 3.
Exponent (p) = 1
Sample (i) Gi (%Cu) Di Dip 1/ Dip Wi Gi * Wi
1 0.023 158 158 0.006329114 0.2150 0.0049
2 0.258 158 158 0.006329114 0.2150 0.0555
3 1.365 212 212 0.004716981 0.1602 0.2187
4 0.409 212 212 0.004716981 0.1602 0.0655
5 0.644 255 255 0.003921569 0.1332 0.0858
6 0.165 292 292 0.003424658 0.1163 0.0192
Sum 2.94384E-02 1.0000 0.4496 %Cu
Exponent (p) = 2
1 0.023 158 24964 4.00577E-05 0.2640 0.0061
2 0.258 158 24964 4.00577E-05 0.2640 0.0681
3 1.365 212 44944 2.22499E-05 0.1466 0.2002
4 0.409 212 44944 2.22499E-05 0.1466 0.0600
5 0.644 255 65025 1.53787E-05 0.1014 0.0653
6 0.165 292 85264 1.17283E-05 0.0773 0.0128
Sum 1.51722E-04 1.0000 0.4124 %Cu
Exponent (p) = 3
1 0.023 158 3944312 2.5353E-07 0.3102 0.0071
2 0.258 158 3944312 2.5353E-07 0.3102 0.0800
3 1.365 212 9528128 1.04952E-07 0.1284 0.1753
4 0.409 212 9528128 1.04952E-07 0.1284 0.0525
5 0.644 255 16581375 6.03086E-08 0.0738 0.0475
6 0.165 292 24897088 4.01653E-08 0.0491 0.0081
Sum 8.17438E-07 1.0000 0.3705 %Cu
39
The weights from the above example found using an exponent (p) of 1, 2, and 3 are shown in
the figure below.
0.3500
0.3000
p=1
P= 2
0.2500 p=3
0.2000
Weight
0.1500
0.1000
0.0500
0.0000
1 2 3 4 5 6
Sample Number
In general terms, inverse distance weighting gives relatively lower weights as the distance
form the point to estimate increases. This relative difference in weights is exaggerated as the
value of the exponent (p) increases, resulting in different values calculated for the %Cu grade
in the examples above.
If sufficient data is available, the modeler may be able to evaluate the estimated values as
compared to actual values, and thereby select the exponent that gives the best match.
A value of 2 for the exponent (Inverse Distance Squared) is commonly applied for mineral
inventory estimation.
40
9 Wire Frame Modeling
Wire frame modeling is often employed when modeling vein type deposits where there are
clear-cut boundaries between the mineralized zone and the surrounding host rock. With wire
frame modeling, a three dimensional solid is created by triangulating the mineralized zone
boundaries between adjacent sections as illustrated below. The three dimensional wire frame
model is then used to control the calculation of blocks in the octree block model. Blocks that
either are completely inside the wire frame or that intersect the wire fame boundaries are
included in the deposit block model.
The wire frame modeling procedure is illustrated using drill hole data from a section of the
Kiruna iron deposit. The zone contains three distinct ore types colored red, green and blue.
First, the geologist displays a vertical section showing the drill holes within the section, with
the various ore types plotted with different colors, (Figure 9.1a). The geologist then overlays
an interpretation of the boundaries of the three ore types on the section as a closed polygon
consisting of a series of line segments, (Figure 9.1b).
a) b)
Figure 9.1. Vertical section with eight drill holes showing color-coded rock types a) and b) with
interpretation of geologic boundaries for three ore zones overlain.
The process is of overlying an interpretation of the three ore zones is repeated for a series of
vertical sections, (Figure 9.2). In this case, a section of the four-kilometer long orebody
approximately 400 m long and 200 m high was modeled.
41
Software routines are then used to triangulate between adjacent sections to form a three
dimensional wire frame model of each of the three distinct ore zones, (Figure 9.3).
Figure 9.2. A series of vertical sections with geologic interpretation of three ore types overlain.
Figure 9.3. Triangulation between adjacent vertical sections forming a wire frame model of
three distinct ore zones.
42
The wire frame model is used to control the block modeling process, (Figure 9.4). In this
case, the three distinct ore zones are captured using an octree block model, (Section 9.1)
Figure 9.4. A section of a three dimensional octree block model created from drill hole
composite data and a three-dimensional wire frame model. Blocks are colored according to
the three distinct ore types.
Figure 9.5. A horizontal section through the octree block model showing ore grades. Blocks
are colored according to the three distinct ore types.
43
9.1 Octree Block Model
One of the problems with block models applied to this type of deposit is that the volume of
rock contained is difficult to capture with regular blocks of a fixed size. One possible
solution to this problem is to apply what is referred to as an octree block model. With this
technique, blocks that intersect a wire frame boundary are subdivided into eight equally sized
smaller blocks. For each of these blocks it is then determined if the block is completely
inside the wire frame, completely outside the wire frame, or intersects the wire frame. No
further processing is done for blocks completely within the wire frame, and blocks
completely outside the wire frame are discarded. The process of subdividing blocks
continues for blocks that intersect the wire frame boundaries until the minimum allowed
block size is reached. At the smallest block size, a 50% rule is applied in that blocks with
50% or more of their volume inside the wire frame are retained, and blocks with more than
50% of their volume outside the wire frame are discarded. The advantage of the octree block
model is that the calculation advantages of uniformly sized blocks are maintained while at
the same time the irregular geometry of the deposit is captured. A further advantage is that
storage space is greatly reduced compared to that required if the smallest block size is used
entirely. Figure 9.6 illustrates this process in two dimensions, (quadtree).
Figure 9.6. A quadtree block model with three subdivisions into three smaller block sizes.
44
10 Cutoff Grade
When developing ore reserves and subsequent mining plans for a potential or ongoing
mining operation, it is essential to determine the grade at which the mineral can no longer be
processed at a profit, the break-even cutoff grade. The break-even cutoff grade can be
calculated as the point where the mining costs equal the projected revenues. In practice this
is not always easy since the grade distribution, metallurgical characteristics (and recovery),
and various mining costs may vary considerably throughout the deposit. During mine
planning and production, other cutoff grades at points other than the break-even cutoff grade
for a variety of reasons are often used. Mineralization below cutoff grade is not considered
ore.
10.1 Example 1
The operating costs for a gold mine are 55 $/ton. The recovery at the mill is 90%. At a gold
price of $400/oz, what is the break-even cutoff grade in oz Au/ton?
Solution
At the break-even cutoff grade, the revenues per ton of ore mined will be equal to the cost
per ton of ore mined.
The cost per ton is given as $55/ton.
The mill will recover 90% of the contained Au. Therefore, 1 ton of ore yields G*0.9 oz Au,
where G is the ore grade in oz Au/ton. At a gold price of $400/oz, the revenue per ton is
$400 * G * 0.9.
The cutoff grade G can be calculated from the equation:
Revenue/ton = cost/ton
$400/oz Au * G * 0.9 = $55/ton, G = 0.15 oz Au /ton
45
10.2 Example 2
The operating costs for a gold mine are 55 $/ton. The recovery at the mill is 90% and the
mining dilution is 10%. At a gold price of $400/oz, what is the break-even cutoff grade in oz
Au/ton?
Solution
One ton of run-of-mine ore at 10% dilution contains 0.9 tons of ore and 0.1 tons of waste.
The mill will recover 90% of the contained Au. Therefore, 1 ton yields G*0.9*0.9 oz Au.
$400/oz Au * G * 0.9 *0.9 = $55/ton, G = 0.17 oz Au /ton
10.3 Example 3
The operating costs for a gold mine are 55 $/ton. The recovery at the mill is 90%. The
smelting and refining costs are $10/ oz Au. At a gold price of $400/oz, what is the break-
even cutoff grade in oz Au/ton?
Solution
The mill will recover 90% of the contained Au. Therefore, 1 ton of ore yields G*0.9 oz Au,
where G is the ore grade in oz Au/ton. The refining cost is $10/oz Au. At a gold price of
$400/oz, the revenue per ton is ($400-$10)oz Au * G * 0.9.
($400/oz Au -$10/oz Au) * G * 0.9 = $55/ton, G = 0.16 oz Au /ton
46
11 Grade Tonnage Curve
The grade-tonnage curve is used in mine planning as a means of determining the tons of ore
available for mining above a given cut-off grade, and its average grade above cut-off. It can
easily be compiled using a set of mining blocks of the same size, such as block data that
would be available after calculating a block model for a deposit.
Figure 11.1 below shows the summary statistics and a frequency histogram calculated from a
set of 996 blocks from an iron ore deposit. Each block represents 500 tons. The lower part
of the figure shows the data used to generate the relative frequency histogram. Ten grade
intervals (cells) were established, and the number of blocks with an iron grade falling within
each grade interval was determined. The interval frequencies are then used to calculate the
relative frequencies and the cumulative frequencies. The relative frequencies are used to plot
the relative frequency histogram.
Figure 11.1. Frequency histogram for iron ore grades from a 996 block data set.
The data given in Figure 11.1 was then used to generate a grade tonnage curve. Table 11.1
shows the data and calculations required for the grade tonnage curve.
47
Table 11.1. Block frequency, grade data, and calculations for grade tonnage curve.
Average Freq. Tons Cumulative Tons * Grade Cumulative Average
Grade (F) (T) Tons above (T*G) (T*G) above Grade above
(G) Cut-off Cut-off Cut-off
60.5 14 7000 498000 423500 32478500 65.2
61.5 36 18000 491000 1107000 32055000 65.3
62.5 68 34000 473000 2125000 30948000 65.4
63.5 123 61500 439000 3905250 28823000 65.7
64.5 170 85000 377500 5482500 24917750 66.0
65.5 209 104500 292500 6844750 19435250 66.4
66.5 226 113000 188000 7514500 12590500 67.0
67.5 125 62500 75000 4218750 5076000 67.7
68.5 23 11500 12500 787750 857250 68.6
69.5 2 1000 1000 69500 69500 69.5
500000
450000
400000
Total Tons Above Cutoff
350000
300000
250000
200000
150000
100000
50000
0
60 62 64 66 68 70
Cutoff %Fe
70
Average Grade %Fe Above Cutoff
69
68
67
66
65
60 62 64 66 68 70
Cutoff %Fe
Figure 11.2. Average grade above cutoff vrs. cutoff for the iron ore data from Table 11.1.
48
Table 11.2. Block frequency, grade data, and calculations for grade tonnage curve.
Average Frequency Relative Cumulative 1-cf

Grade (f) frequency frequency
(g) (cf)
60.5 14 1.41 1.41 98.59
61.5 36 3.61 5.02 94.98
62.5 68 6.83 11.85 88.15
63.5 123 12.35 24.20 75.80
64.5 170 17.07 41.27 58.73
65.5 209 20.98 62.25 37.75
66.5 226 22.69 84.94 15.06
67.5 125 12.55 97.49 2.51
68.5 23 2.31 99.80 0.20
69.5 2 0.20 100.00 0.00
100
% of Total Tonnage Above Cutoff
90
80
70
60
50
40
30
20
10
0
60 62 64 66 68 70
Cutoff %Fe
Figure 11.3. Grade tonnage curve for the iron ore data from Figure 11.1.
49
12 Reporting Exploration Information, Resources & Reserves
On February 24,1991, the report, 'A Guide for Reporting Exploration Information, Resources
and Reserves' prepared by Working Party No.79 -'Ore Reserves Definition' of the Society of
Mining, Metallurgy and Exploration (SME), was delivered to the SME Board of Directors
(SME, 1991). This report was subsequently updated in 1999 to take into account the October
1998 agreement reached in Geneva to develop an internationally accepted set of definitions
and reporting standards (SME, 1999). In this section, the 'Definitions' and 'Report
Terminology' portions of their report are included. The definitions presented are tied closely
to the sequential relationship between exploration information, resources and reserves shown
in Figure 12.1.
The guidelines have since been updated again in 2007, and this version may be found at:
http://www.smenet.org/docs/publications/enews/Sme_Guide_for_Reporting_Exploration_Re
sults_2007.pdf
Figure 12.1 The relationship between exploration information, resources and reserves (SME,
1999).
With an increase in geological knowledge, the exploration information may become

sufficient to calculate a resource. When economic information increases it may be possible to
convert a portion of the resource to a reserve. The double arrows between reserves and
50
resources in Figure 6.1 indicate that changes due to any number of factors may cause
material to move from one category to another.
12.1 Definitions
Exploration information. Information that results from activities designed to locate
economic deposits and to establish the size, composition, shape and grade of these deposits.
Exploration methods include geological, geochemical, and geophysical surveys, drill holes,
trial pits and surface underground openings.
Resource. A 'Mineral Resource' is a concentration or occurrence of material of intrinsic

economic interest in or on the Earth's crust (a deposit) in such form and quantity that there
are reasonable prospects for eventual economic extraction. The location, quantity, grade,
geological characteristics and continuity of a Mineral Resource are known, estimated or
interpreted from specific geological evidence and knowledge. Mineral
Resources are sub-divided, in order of increasing geological confidence, into Inferred,
Indicated and Measured categories. Portions of a deposit that do not have reasonable
prospects for eventual economic extraction must not be included in a Mineral Resource.
-Inferred. An 'Inferred Mineral Resource' is that part of a Mineral Resource for

which tonnage, grade and mineral content can be estimated with a low level of
confidence. It is inferred from geological evidence and assumed but not verified
geological and/or grade continuity. It is based on information gathered through
appropriate techniques from locations such as outcrops, trenches, pits, workings and
drill holes which is limited or of uncertain quality and/or reliability. An Inferred
Mineral Resource has a lower level of confidence than that applying to an Indicated
Mineral Resource.
-Indicated. An 'Indicated Mineral Resource' is that part of a Mineral Resource for

which tonnage, densities, shape, physical characteristics, grade and mineral content
can be estimated with a reasonable level of confidence. It is based on exploration,
sampling and testing information gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings, and drill holes. The locations are
too widely or inappropriately spaced to confirm geological continuity and/or grade
continuity but are spaced closely enough for continuity to be assumed. An Indicated
Mineral Resource has a lower level of confidence than that applying to a Measured
Mineral Resource, but has a higher level of confidence than that applying to an
Inferred Mineral Resource.
-Measured. A 'Measured Mineral Resource' is that part of a Mineral Resource for

which tonnage, densities, shape, physical characteristics, grade and mineral content
can be estimated with a high level of confidence. It is based on detailed and reliable
exploration, sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits, workings, and drill holes.
The locations are spaced closely enough to confirm geological and/or grade
continuity.
51
Reserve. A 'Mineral Reserve' is the economically mineable part of a Measured or Indicated
Mineral Resource. It includes diluting materials and allowances for losses that may occur
when the material is mined. Appropriate assessments, which may include feasibility studies,
have been carried out and include consideration of and modification by realistically assumed
mining, metallurgical, economic, marketing, legal, environmental, social and governmental
factors. These assessments demonstrate at the time of reporting that extraction is reasonably
justified. Mineral Reserves are sub-divided in order of increasing confidence into Probable
Mineral Reserves and Proved Mineral Reserves.
The term economic implies that extraction of the Mineral Reserve has been established or
analytically demonstrated to be viable and justifiable under reasonable investment and
market assumptions. The term Mineral Reserve need not necessarily signify that extraction
facilities are in place or operative nor that all governmental approvals have been received. It
does signify that there are reasonable expectations of timely approvals.
Reserves relate to resources as follows:
-Probable reserve. A 'Probable Mineral Reserve' is the economically mineable part

of an Indicated and, in some circumstances, Measured Mineral Resource. It includes
diluting materials and allowances for losses that may occur when the material is
mined. Appropriate assessments, which may include feasibility studies, have been
carried out and include consideration of and modification by realistically assumed
mining, metallurgical, economic, marketing, legal, environmental, social and
governmental factors. These assessments demonstrate at the time of reporting that
extraction is reasonably justified. A Probable
Mineral Reserve has a lower level of confidence than a Proved Mineral Reserve.
-Proved reserve. A 'Proved Mineral Reserve' is the economically mineable part of a

Measured Mineral Resource. It includes diluting materials and allowances for losses
that may occur when the material is mined. Appropriate assessments, which may
include feasibility studies, have been carried out and include consideration of and
modification by realistically assumed mining, metallurgical, economic, marketing,
legal, environmental, social and governmental factors. These assessments
demonstrate at the time of reporting that extraction is reasonably justified.
When reporting a Mineral Reserve, tonnages, grades and mineral or metal contents must be
reported after taking into account mining loss and mining dilution. Mineral and metal
contents can be reported after also taking into account processing recoveries. If processing
recoveries are not taken into account, the percentage expected to be recovered or lost after
processing must be reported.
Reporting terminology
Public reports dealing with exploration information, mineral resources and/or mineral
reserves must only use the terms set out in Fig. 6.1
52
Competence and responsibility
A public report concerning exploration information, mineral resources and/or mineral

reserves must be based on, and fairly reflect, the content of a report prepared by a competent
person (or persons) as defined below.
A "competent person is a person who is a member of a professional society for earth

scientists or mineral engineers, or has other appropriate qualifications. The competent person
must have a minimum of five years experience that is relevant to the style of mineralization
and type of deposit under consideration and to the activity that person is undertaking.
If the competent person is estimating or supervising the estimation of mineral resources, the
relevant experience must be in the estimation, assessment and evaluation of mineral
resources. If the competent person is estimating or supervising the estimation of mineral
reserves, the relevant experience must be in the estimation, assessment, evaluation and
economic analysis of mineral reserves.
53
13 References
Sinclair, A. and Blackwell G., 2002. Applied Mineral Inventory Estimation, Cambridge
University Press, 376 pages
Parks, R., D., 1957, Examination and Valuation of Mineral Properties, Addison-Wesley
Publishing Company, Reading Massachusetts
Readdy, L., A., Bolin, D., S., and Mathieson, G., A., 1982, Ore Reserve Calculation, in
Underground Mining Methods Handbook, Hustrulid, W.,A., editor, Society of Mining
Engineers, New York
SME, 2007. SME Guide for Reporting Exploration Results,

http://www.smenet.org/docs/publications/enews/Sme_Guide_for_Reporting_Exploration_Re
sults_2007.pdf
JORC Code
http://www.jorc.org/index.asp
SAMVAL - South African Mineral Asset Valuation Code

http://www.samcode.co.za/
PERC -Pan-European Reserves & Resources Reporting Committee

http://www.percreserves.com/
CRIRSCO -Committee for Mineral Reserves International Reporting Standards

http://www.crirsco.com
USGS, 1976. Principles of a Resource/Reserve Classification For Minerals, Geological

Survey Circular 831, by the U.S. Bureau of Mines and the U.S. Geological Survey
54
Appendix 1. Working With ASCII Format Drill Hole Data Files
This appendix discusses one possible format for storing drill hole data in an ASCII (text) file.
Techniques for calculating the coordinates of a drill hole toe and assays are discussed and
illustrated by numeric examples.
Drill hole data file description

Before the widespread use of relational databases (SQL) for storing drillhole data, a flatfile
ASCII text format was used. This section describes one possible format.
Each line of the drill hole file starts with a record type number that indicates the type of data
in that line.
A drill hole file has three basic components

the file header (record type 0)
the drill collar record (record type 1)
the drill hole assay records (record type 2)
A drill hole file begins with the header records. The remaining lines of the file contain a
series of drill hole records. The data for each drill hole consists of a collar record followed
by a number of assay records.
Drill hole file header

The drill hole file must begin with a header. The first header line gives the number of assay
values and has the format:
Record type: Always 0, followed by a blank space or comma

Number of assays: 1 to n, the number of assay values per assay record
The next line in the header gives the names of the assay values and has the format:

Assay name: An eight-character name for each assay with
multiple names followed by a blank space or comma
As an example, the two file header lines for a file with one assay value (%Copper) are:
01
0 %Copper
55
Drill hole collar record
Each drill hole is defined by a collar record that must contain the following:
Hole ID: An eight-character hole identifier.
Xc, Yc, Zc: The coordinates of the drill hole collar.
Azimuth: The azimuth of the drill hole in degrees measured clockwise from the
North meridian.
Plunge: The plunge of the drill hole measured from the horizontal plane; a
plunge of +90 indicates a vertical hole extending upwards from the
hole collar, a plunge of 0 indicates a horizontal hole, and a plunge of
90 indicates a vertical hole extending downward from the hole collar.
Length: The length of the drill hole measured from the hole collar to the hole
toe.
There are no rigid formatting requirements for the position of values within a record or for
the number of decimal places a value contains except that the hole ID must start in column
three and it must end in column ten.
Drill hole assay records

After a drill hole collar record are the assay records with each containing the following:
Hole ID: An eight-character hole identifier.
From length: The distance from the collar to the start of the assay.
To length: The distance from the hole collar to the end of the assay.
Values: One or more assay values separated by a space.
One assay value for each interval along the entire length of the drill hole must be entered.
The assay records must be entered sequentially, i.e., the From length from the previous
record must be the same as the To length of the current record. Any negative number can
be entered where assay values are missing or undefined.
56
Example drill hole data file
010
0 %Cu
1 Dh 49 2582.00 5042.00 3984.00 0.00 -90.0 145.00
3 Dh 49 0.00 8.00 -0.99
3 Dh 49 8.00 10.00 0.12
3 Dh 49 10.00 13.00 0.35
3 Dh 49 13.00 18.00 0.33
3 Dh 49 18.00 23.00 0.39
3 Dh 49 23.00 28.00 0.52
3 Dh 49 28.00 33.00 0.27
3 Dh 49 33.00 38.00 0.46
3 Dh 49 38.00 43.00 0.16
3 Dh 49 43.00 48.00 0.10
3 Dh 49 48.00 52.00 0.18
3 Dh 49 52.00 57.00 0.24
3 Dh 49 57.00 62.00 0.22
3 Dh 49 62.00 67.00 0.18
3 Dh 49 67.00 70.00 0.05
3 Dh 49 70.00 75.00 0.04
3 Dh 49 75.00 80.00 0.05
3 Dh 49 80.00 85.00 0.03
3 Dh 49 85.00 90.00 0.10
3 Dh 49 90.00 99.00 0.04
3 Dh 49 99.00 104.00 0.03
3 Dh 49 104.00 109.00 0.04
3 Dh 49 109.00 114.00 0.02
3 Dh 49 114.00 119.00 0.02
3 Dh 49 119.00 122.00 0.02
3 Dh 49 122.00 126.00 0.02
3 Dh 49 126.00 131.00 0.02
3 Dh 49 131.00 136.00 0.02
3 Dh 49 136.00 141.00 0.02
3 Dh 49 141.00 145.00 0.09
1 Dh 50 2267.00 5066.00 4009.00 0.00 -90.0 484.00
3 Dh 50 0.00 10.00 -0.99
3 Dh 50 10.00 17.00 0.18
3 Dh 50 17.00 22.00 0.25
3 Dh 50 22.00 27.00 0.35
3 Dh 50 27.00 32.00 0.39
3 Dh 50 32.00 36.00 0.29
57
Definition of Azimuth and Plunge
The azimuth of a line is its horizontal angled measured from the meridian to the line. In
plane surveying, azimuths are usually measured clockwise from the north meridian.
Azimuths have values between 0 and 360 degrees.
The plunge angle is the angle at which the drill hole intersects the horizontal plane.
A plunge of +90 indicates a vertical hole extending upwards from the drill hole collar.
A plunge of 0 indicates a horizontal drill hole.
A plunge of 90 indicates a vertical hole extending downward from the drill hole
collar.
58
Calculating coordinates along a drill hole
The drill hole toe coordinates can be calculated from the drill hole collar coordinates, the
azimuth angle, the plunge angle, and the hole length by:
Xt = Xc + Length * cos(Plunge) * sin(Azimuth) (1.1)

Yt = Yc + Length * cos(Plunge) * cos(Azimuth)
Zt = Zc + Length * sin(Plunge)
Equation 1.1 can be used to calculate the coordinates of any point along the drill hole at a
distance from the hole collar defined by the term length.
Example:
The toe coordinates are calculated from a drill dole with the following collar information:
Hole ID Collar X Collar Y Collar Z Azimuth Plunge Length

DDH 49 100.00 200.00 300.00 60.00 -30.00 225.00
Xt = Xc + Length * cos(Plunge) * sin(Azimuth)

= 100.00 + 225.00 * cos(-30) * sin(60)
= 100.00 + 225.75
= 325.75
Yt = Yc + Length * cos(Plunge) * cos(Azimuth)

= 200.00 + 225.00 * cos(-30) * cos(60)
= 200.00 + 97.43
= 297.43
Zt = Zc + Length * sin(plunge)
= 300.00 + 225.00 * sin(-30)
= 300.00 112.50
= 187.50
59
Calculating coordinates along a drill hole 2D
In two dimensions, the drill hole toe coordinates can be calculated from the drill hole collar
coordinates, the azimuth angle, and the hole length by:
Xt = Xc + Length * sin(Azimuth) (1.1)

Yt = Yc + Length * cos(Azimuth)
Equation 1.1 can be used to calculate the coordinates of any point along the drill hole at a
distance from the drill hole collar defined by the term length.
Hole ID Collar X Collar Y Collar Z Azimuth Plunge Length

DDH 10 100.00 200.00 300.00 60.00 0.00 225
DDH 20 100.00 200.00 300.00 300.00 0.00 225
Example 1:
The coordinates of the drill hole toe for DDH 10 are calculated by:
Xt = Xc + Length * sin(Azimuth)
= 100.00 + 225.00 * sin(60)
= 100.00 + 194.86
= 294.86
= 200.00 + 225.00 * cos(30)
= 200.00 +112.50
= 312.50
Example 2:
The coordinates of the drill hole toe for DDH 20 are calculated by
Xt = Xc + Length * sin(Azimuth)
= 100.00 + 225.00 * sin(300)
= 100.00 194.86
= 94.86
= 200.00 + 225.00 * cos(300)
= 200.00 +112.50
= 312.50
60
Calculating Assay Coordinates With the Parametric Equation of a Line
The parametric equation of a line provides a convenient method for calculating the
coordinates of drill hole assays given in the From To format without the use of
trigonometric functions.
The assay From value is the distance along the drill hole, measured from the drill hole
collar, to the start of the assay interval.
The assay To value is the distance along the drill hole, measured from the drill hole collar,
to the end of the assay interval.
Parametric Equation of a Line

Given a line segment defined by two points (X0, Y0, Z0) and (X1, Y1, Z1), the change in X
(dx), Y (dy), and Z (dz) along the segment is found by:
dx = (X1 X0)
dy = (Y1 Y0)
dz = (Z1 Z0)
The parametric equation of the line passing through the segment end points in terms of the
parameter (t) is:
X(t) = X0 + t(dx)
Y(t) = Y0 + t(dy)
Z(t) = Z0 + t(dz)
where:
t = any real number
At a value of t = 0, the calculated coordinate would be segment endpoint (X0, Y0, Z0).
At a value of t = 1, the calculated coordinate would be segment endpoint (X1, Y1, Z1).
Values of t between 0 and 1 will give coordinates of points on the line between the
endpoints.
Values of t greater than 1 or less than 0 will produce points on the line but outside the
line segment interval.
61
Example 3. Calculate the coordinates of a drill hole assay given the drill hole collar
and toe coordinates.
Drill Hole Coordinates

X Y Z
Collar 250.00 1600.00 720.00
Toe 700.00 2100.00 940.00
Deltas 450.00 500.00 220.00
Length 707.7429
Drill Hole Assay From-To Lengths

From To %Cu
80.00 88.00 1.2
Solution.
Using the parametric equation of a line, the assay coordinates are calculated as:
Assay From Coordinates

t = from/length = 80.00/707.7429 = 0.1130
x = x0 + t(dx) = 250.00 + 0.1130*450.00 = 300.87

y = y0 + t(dy) = 1600.00 + 0.1130*500.00 = 1656.52
z = z0 + t(dz) = 720.00 + 0.1130*220.00 = 744.87
Assay To Coordinates
t = to/length = 88.00/707.7429 = 0.1243
x = x0 + t(dx) = 250.00 + 0.1243*450.00 = 305.95

y = y0 + t(dy) = 1600.00 + 0.1243*500.00 = 1662.17
z = z0 + t(dz) = 720.00 + 0.1243*220.00 = 747.35
62

Notes On Mineral Inventory Estimation

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Notes On Mineral Inventory Estimation

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Notes on Mineral Inventory Estimation

The quality of a mineral inventory depends factors such as:

A mineral inventory makes no presumptions about the mineability of the deposit.

Mineable reserves are usually expressed as tons and grades.

The mineral inventory might also be considered in terms of:

The geologic Resource

The mining Reserves or economic portion of the geologic Resource (ore)

2) Average grades are calculated using some form of a weighted average.

1.1.1 Arithmetic Average

1.1.2 Weighted Average

Sample Length Assay Value

Figure 1.1. Channel sample location and associated data.

Using an arithmetic average, the average grade () would be calculated as:

x i 1.09 + 0.50 + 0.13

A i L i (1.09 * 0.6) + (0.50 * 1.6) + (0.13 * 1.3)

Figure 1.2. Weighting commonly used in mineral inventory calculations.

1.2.1 Determining Specific Gravity of Rock

7.6 (g/cm3) * 10 (cm3) = 76.0 g galena

Density = 494.5 (g) / 100 (cm3) = 4.95 (g/cm3); SG = 4.95

1.2.2 Tonnage Factor Calculation

Tonnage Factor (ft3/ton) = (2000 lb/ton)/(SG * 62.5 lb/ ft3 water)

1.2.3 Tonnage Factor Calculation Example

Tonnage Factor = (2000 lb/ton)/(2.8 * 62.5 lb/ ft3) = 11.4 ft3/ton

1500 (ft3)/11.4 (ft3/ton) = 132 tons

Figure 1.3 Two vertical drill holes intersecting a vein structure.

= arctan(dy/dx) = arctan(330/400) = 39.52

Wv = I * cos( ) = 20 * cos(39.52) = 15.43 units

2.1 Mining Dilution

To * G Pb + Tw * G w 137.3 * 7.5 + 14.0 * 0.0

To * G Ag + Tw * G w 137.3 * 12.2 + 14.0 * 0.0

The % Dilution is: D = (Tw / Tt)*100 = (14.0/151.2) *100 = 9.2 % Dilution

Step 1 in the calculation procedure is to determine the areas represented by regions R1

The areas for regions R2 and R4 can be calculated by:

Figure 5.1 Reserve polygons example and underlying triangulation.

5.1 Polygon Construction

Step c: construct the perpendicular bisectors of the segments constructed in step b.

5.2 Reserve Calculation By Polygons Example

Average Grade Drill Hole D 2 =

Average Grade Entire Deposit =

Figure 7.1. Vertical section through a hypothetical iron ore deposit.

Hole Interval Interval Grade

DDH2 Average Grade Fe =

DDH3 136.0 146.0 10.0 52.0 520.0

DDH3 Average Grade Fe =

DDH4 141.0 149.0 8.0 60.0 480.0

7.5 Determining the Average Grade for a Section

7.6.1 Volumes and Grades by the Average End Area Formula

And the volume V2 as:

VT = (A1 + 2A2 + 2A3 ...An)/2 * L

GV1 = [G1*A1 + G2*A2] / [A1 + A2]

The grade for volume V2 is calculated by:

GV2 = [G2*A2 + G3*A3] / [A2 + A3]

GT = [GV1*V1 + GV2*V2] / [V1 + V2]

GT = [ (G1A1 + 2G2A2 + 2 G3A3 ...GnAn)] / [(A1 + 2A2 + 2A3 ...An)]

Tones = 731887.5 m3 * 4.5 = 3,293,494 tonnes

7.6.2 Volumes by the Midpoint Extension Formula

The total volume represented is calculated as:

Total Volume (VT) = Vi

Tones = 1,085,925 m3 * 4.5 = 4,887,000 tonnes

Figure 8.1. Three-dimensional block model (MineSight)

Figure 8.2. The calculation of bench composites

C = [55.2 * 8 + 53.1 *12 + 60.2 * 6 + 48.3 *14] / 40 = 52.9

C = [55.2 * 8 + 53.1 *12 + 60.2 *6] / 26 = 55.4

The % Dilution is: D = (Tw / Tt)100 = (14.0/151.2) 100 = 9.2 % Dilution

GV1 = [G1A1 + G2A2] / [A1 + A2]

GV2 = [G2A2 + G3A3] / [A2 + A3]

GT = [GV1V1 + GV2V2] / [V1 + V2]

C = [55.2 * 8 + 53.1 12 + 60.2 6 + 48.3 *14] / 40 = 52.9

C = [55.2 * 8 + 53.1 12 + 60.2 6] / 26 = 55.4