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Pretium Resources Inc. Message Board

  • sewells831 sewells831 Oct 23, 2013 11:52 AM Flag

    for jantro

    jantro, here is the pertinent bit from the press release. "Prior to resigning from the Program, Strathcona Mineral Services Ltd ("Strathcona") provided to Pretivm preliminary assay results from the sample tower that included those for the 426585E cross-cut, which averaged 2.08 grams per tonne gold."

    The fact of the matter here is that one estimation technique is being compared to another. IF strathcona's assays had been just from the stopes, then you might have a point. But, the purpose of the bulk sample is to reconcile the grade estimates from drilling with the actual recovered grades. If you notice, the samples from Strathcona were not confined to the stopes, they were taken from the entirety of the bulk sample from that area. So, the question here, at least for the purposes of reconciling grade to estimation methods, has not a lot to do with what do the planned stopes have in them. It has to do with which estimation method, applied to the material that was bulk sampled, gives a result that is sufficiently accurate. It's an apples to apples comparison between the two. Strathcona sampled the bulk sample material, not just the stope material and predicted that the gold that would come from milling that bulk sample material would be about 2.08 gpt.

    Their prediction was clearly wrong. The other prediction that was made was Snowden's. Their prediction for the bulk sample area was 4.6 gpt. That is very nearly correct.

    So, my question to you is a simple one. On what rational ground could you think a prediction that was off by nearly 2 gpt is a better prediction than one that was off by 0.6 gpt. They both predicted the gold content of the same thing and one prediction was clearly much closer to the actual than another.

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    • Sewelles831: Where did you get the Snowden prediction of 4.6 gpt for 585E? The way I read the press release is that this is what Snowden predicts AFTER getting back the mill results. I am very curious about what they would have predicted prior to the mill results. I am not sure that is what the 4.6 gpt represents (despite what the seeking alpha article may imply). I would feel MUCH better as an investor if their "prediction" (in advance of the mill processing) is the 4.6 gpt that you claim. Thanks in advance.

      Sentiment: Buy

      • 2 Replies to steelpokers
      • I think you are correct about this. I don't think they could have predicted 4.6 gpt in advance as they used a 4 gpt top cut in the low grade domains. Here's what the feasiblity study said about the low grade domains which 585E is in. "The relatively low skewness and the presence of only few samples with extreme grades in the low-grade domains allowed for the estimation of grades using ordinary kriging with a top cut. A top cut of 4 g/t Au and 100 g/t Ag was selected for VOK, based on the point of disintegration seen on the histogram and log probability plot. A top cut of 3 g/t Au and
        100 g/t Ag was selected for West Zone."

        So, it seems I did indeed misread the press release. If I understand the top cut process, they really couldn't have predicted more than 4 gpt for the low grade domain material in advance of the bulk sample because any assays they had for gold higher than that they discarded and used a 4 gpt value instead.

        I apologize for misreading the press release and making mis statements of fact.

      • Well, now that you mention it that bit of the press release was a little bit ambigous. Here's what it said: "The 426585E cross-cut excavation cuts through portions of three Feasibility Study stopes (the "426585E Stopes"). The tonnage processed and the grade of the gold and silver produced from the material excavated from the 426585E development going through these stopes was estimated to be 1,451 tonnes grading 4.6 grams per tonne gold and 6.8 grams per tonne silver, based on the preliminary mill results estimated for the 426585E Stopes. The value of the gold and silver produced from the 426585E Stopes was estimated to be $204.03/tonne at Feasibility Study base case metal prices providing an operating margin of $47.57/tonne over Feasibility Study operating costs.""

        Since they were talking about only that subset of material in this first bulk sample run that came from three stopes that were in the feasibility study; (i.e., only 1451 tonnes of the 2000+ tonne total) it seemed clear to me that this is what the values used in the feasibility study values for those stopes predicted. How else would they have estimated that? However, I do see your point about the wording. Maybe it doesn't mean what I read it to mean. I'll look at the feasibility study again to see if I can get any more clarity on that.

    • On more than on occasion you have stated that Snowen "predicted" 4.6 g/t. You are interpreting the data incorrectly. The bulk sample contained 281 troy oz (8740 gr) in 2,167 tonnes of material milled for a grade of 4.0 g/t. However, in the feasibility study only 1,451 tonnes of this material was contained in mined stopes intended for milling. (The remaining 716 tonnes was deemed waste in the feasibility study) The grade of the material contained in stopes is 4.6 g/t as stated. BUT the block model states that this grade should have been in the order of 13 g/t (I have actually seen a figure of 16 g/t bandied about somewhere). So the grade of the material encountered is roughly a third of what was supposed to be encountered. You are comparing 4 with 4.6 when you should be comparing 4.6 with 13.

      • 3 Replies to jack.marshall65
      • You are correct that I misread the press release and therefore was in error when I said that Snowden predicted 4.6 in advance. I had read the feasibility study and remembered a 4 gpt ish figure. That wasn't their prediction for those stopes. That was the top cut value they established for the low grade domains which those three stopes were in.

        My bad, my error.

        But if they established a 4 gpt top cut for the low grade domains, I really don't think you can make the case that Snowden had those 3 stopes pegged at 13 gpt either.

      • Isn't the Snowden estimate for stopes AND waste? Obviously, if you do a milling test for 1451 tonnes of stopes and 716 tonnes of waste your estimate for the mill result has to be the average of stopes and waste. So Snowden's estimate for the stopes would be ca. 7 g/t and waste 0 g/t, averahe 4.6g/t. Snowden's result of 4g/t could translate to 6g/t for the stopes which would confirm the block model (if they have 7g/t there). But Snowden's result could also mean there is only 4g/t in the stopes and 4g/t in the waste material destroying the block model. That's why tower samples are needed. Or am I wrong here?

      • Jack.marshall: I agree with your interpretation of the 4.6g/t. However, I am not sure that 13 is correct either for 585E. They mention in the last conference presentation that they will be running the lowest grade stopes first (585E) and then move on to the others. I took this to mean that the full stope average would be ~13, but the initial stopes would be less (how much less is what I am very interested in finding out!)...

    • To understand what's going on you have to understand tower sampling. Of course they calculated the 2g/t over the whole area, not only the stope bits.But the tower enabled you to take much more smaller samples, to use cut off for very high grades. Strathcona could exactly say from which area the current part of the sample came and adjust accordingly. One such adjustment is to to eliminate very high grades due to the nugget effect in areas not to be stoped . I would be very interested in the detailed approach Strathcona chose. They could get a much much better understanding of the deposit for sure.

      • 1 Reply to jantrou
      • I have a pretty good understanding of tower sampling. One thing I understand, for instance, is that small samples tend to misstate the gold content of rock that is gold bearing if the distribution of gold in that rock is unevenly distributed because economic quantities of gold are extremely dense and small in relation to the quantity of rock that is being sampled. If the gold is 100% evenly distributed, then the size of the sample you take makes no difference. The more unevenly distributed, the more difference the size of the sample makes. The obvious solution to the sampling bias toward understatement by drill cores and tower sampling is to take samples that are 100% of the material.

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