The whole point of obtaining sample information is to create a model of the hoped-for orebody. Like most things, the less that is known about an orebody the bigger it is. That might argue for collecting all the necessary information prior to creating a model from which an estimate of its size can be generated but model building occurs as soon as the first data is received. Humans, being who they are, cannot stop creating models of the data that crams their brains as a result of seeing, touching, smelling, hearing and thinking. Remember what it is to walk through the door of your home and smell what seems like fresh-baked bread. The model you form instantly creates drool at the corners of your mouth and when you find out that the model does not match reality because your kids have eaten all the bread then you do something irrational like hit the first person you see. Models are important.

So the first lesson is to try to quantify a model with whatever data is at hand. Then your brother-in-law can state, “The model we have constructed of the mineralization suggests that there are 200 million ounces of gold ready to be plucked from the earth.” Obviously you will need some tools to determine the reliability of the model - things like the spacing between data points, whether the data is of recent vintage or is taken from a journal written in 1765; stuff like that.

As you can see I am a big believer in models and the more quantifiable they are the better they are. Nor do I think that a lack of data is an excuse to not create a model. Rather a model that is qualified by the type and quantity of data used to create it is perfectly valid. This section will describe the process to create and qualify a model of the orebody formed by the geological, structural and mineral grade information that has been collected. A note of caution here. Stock exchanges now require much more qualifying information prior to a mining company talking publicly of the model and the estimate of mineralization determined by the model. This is a very good thing for investors but it is not a solution to those who would willingly “over achieve” on their estimates. When the brother-in-law says he has found an orebody with over a million ounces of gold learn to ask him if the estimate has been made by a Qualified Person and whether it fits with the CIM definitions of resource or reserve. If he makes the claim at a family dinner your question will effectively shut him up and you will be able to eat in peace. If you are having a private conversation he will either say “yes” or blink rapidly, get red in the face and walk away from you. Either way you win.

The discussion of geological modeling sounds kind of boring but it has a very colourful history. Busang and BreX were what they are because of the issues surrounding the model that the company created in the minds of its shareholders. More on Busang below.

But this brings up an important issue; You can make money on scams as easily as valid projects if you understand the concepts of geologic modeling. Mind you I didn’t make any money on BreX so what do I really know. The first thing to understand is the concept of variability.