Clearing the Clutter: Mining Research, the NI 43-101, and Due Diligence
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Clearing the Clutter: Mining Research, the NI 43-101, and Due Diligence

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The following content is sponsored by Prospector Portal

Mining Research NI 43-101

Mining Research NI 43-101

Clearing the Clutter of Research: NI 43-101 and Due Diligence

Mining companies offer the potential for great investment returns, but they also carry many risks because of the complex science behind mining and mineral exploration. This complexity can deceive, so it is important to have standards on how companies report the technical data.

This infographic comes to us from Prospector Portal and takes a look at the events that led to the creation of the the NI 43-101, and the variety of information a mining project generates.

Why Does Mining Research Matter?

Bre-X and the Creation of the NI 43-101

The 1997 PDAC was the peak for one mineral exploration company, Bre-X. The annual event in Toronto serves as the gathering point for the global mining industry to raise capital, sell services, and highlight successes. It was there that Bre-X received an award for finding one of the largest gold deposits in the world, the Busang gold deposit in Indonesia.

Soon after the conference, Bre-X’s exploration manager fell to his death from a helicopter. There was mounting evidence that the junior’s project was a hoax and that the company’s geologist salted samples with gold from other sources.

In May 1997, the Toronto Stock Exchange (TSE) delisted Bre-X, vaporizing $3 billion in value as the company’s shares became worthless. The fraud deceived investors and undermined confidence in financial markets.

The TSE and the Ontario Securities Commission established the Mining Standards Task Force. This task force recommended stricter disclosure of drill results to ensure accuracy and a requirement to have a qualified geoscientist back up the technical data.

These recommendations culminated in the creation of the National Instrument 43-101 Standards for Disclosure of Mineral Projects.

How the NI 43-101 Can Answer Questions

Understanding the Due Diligence Process

Along with providing clear definitions for mining terms, the NI 43-101 outlines the necessary information for the technical reports in several sections. Each section can help to answer some questions that could arise when researching a company.

  1. Accessibility, Climate, Local Resources, Infrastructure, and Physiography:
    Is a mining project logistically viable at this property’s location?

    This portion of the NI 43-101 describes the topography, elevation, and vegetation around the property, along with the means of access, proximity to a population center, and the nature of transport to and from the site. In addition, the report can contain potential climate impacts on the length of operating season, and the availability of power, water, and personnel.
  2. Property Description and Location:
    Are there any potential ownership or issuance problems with the property?

    In this section, you will find information about the location and area of the property, type of mineral tenure, and the company’s ownership along with any obligations to retain the property. This section must also include any other risks that can affect access, title, or the right and ability to perform work on the property.
  3. History
    What is the property’s history of development and production?

    The history of the project outlines prior ownership and changes of ownership of the property, along with the work and results of previous exploration and development work at the property. Companies include historical mineral resource and mineral reserve estimates and any past production from the property.
  4. Drilling
    What kind of drilling will take place, and what are the results?

    This section includes the type and extent of drilling, procedures followed, and a summary of results. These factors could impact the accuracy and reliability of the results.
  5. Mineral Resource Estimates
    How are the mineral resource estimates derived, and what factors are affecting those estimates?

    This section outlines the key assumptions and methods used to estimate mineral resources. There is a report of the individual grade of each metal or mineral, along with relevant factors used to estimate this. There is also an outline of any external factors that affect mineral resource estimates such as taxation, environmental, or political.
  6. Economic Analysis
    What is the economic forecast for this property?

    This includes any economic analysis for the project such as cash flow forecasts, net present value, and internal rate of return, along with summaries of taxes, royalties, or other interests applicable.

Mining and mineral exploration companies regularly disclose NI 43-101 reports as new information comes in. Management will file any material information on a system called SEDAR. However, SEDAR is an older format that makes the process difficult to search for specific information.

Clearing the Clutter to Know Your Risks

There are many factors that affect an investment decision, especially in the mining industry. This complexity can lead to volatile returns as one of the many variety of factors can affect the outcomes of a mineral project. The first step in understanding these risks is to know where to find the information in the NI 43-101.

“People aren’t allowed to just calculate resources on the back of an envelope anymore…You look at the resource boom we’re going through. The companies that don’t follow the rules, they stand out.”
– Maureen Jensen, Former Chair of the Ontario Securities Commission, 2007

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Visualizing the Evolution of the Global Meat Market

The global meat market will be worth $1.8 trillion by 2040, but how much of that will plant-based alternatives and cultured meat command?

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The Evolution of the Global Meat Market

In the last decade, there has been an undeniable shift in consumers’ preferences when it comes to eating meat.

This is partly due to the wide availability of meat replacement options combined with growing awareness of their health benefits and lower impact on the environment compared to conventional meat.

In this infographic from CULT Food Science (CSE: CULT), we examine how meat consumption is expected to evolve over the next two decades. Let’s dive in.

Taking a Bite out of Meat’s Market Share

The COVID-19 pandemic triggered a massive turning point for the meat industry, and it will continue to evolve dramatically over the next 20 years. Taking inflation into account, the global meat market is expected to grow overall by roughly 3% by 2040 as a result of population growth.

However, as consumption shifts, conventional meat supply is expected to decline by more than 33% according to Kearney. These products will be replaced by innovative meat alternatives, some of which have yet to hit the mass market.

  • Novel vegan meat replacement: These are meat alternatives products made from plants that resemble the taste and texture of meat.
  • Cultured meat: Also referred to as clean, cultivated, or lab grown meats, cultured meat is a genuine meat product that is produced by cultivating animal cells in a controlled environment without the need to harm animals.

Aside from new meat replacements, biotech will also transform adjacent industries like dairy, eggs, and fish.

The Future of Food?

Meat replacements and cultured meat could overtake the conventional meat market, with cultured meats reigning supreme overall with a 41% annual growth rate (CAGR) between 2025 and 2040.

New technologies for cultivating non-animal based protein will provide one-third of the global meat supply due to an increase in commercial competitiveness and consumers becoming more accepting of these kinds of products.

Meanwhile, conventional meat will make up just 40% of all global meat supply by 2040, compared to 90% in 2025. For this very reason, conventional meat producers are investing a significant amount of capital in meat alternative companies so they can avoid disruption.

Invest in the Revolution

The changing tides in the industry have sparked a variety of undeniable opportunities:

  • Regulatory approvals: Singapore is the first country to legalize cultured meat for consumers, and many more will no doubt follow behind in the coming years.
  • Lower production costs: Cultured meat and dairy have made quantum leaps in reducing production costs.
  • Changing consumer ethics: Consumers are demanding a more ethical approach to factory farming and cultured and plant-based alternative products are becoming a more accepted solution.

CULT Food Science (CSE: CULT) is a cutting edge investment platform advancing the future of food. The first-of-its-kind in North America, CULT aims to provide unprecedented exposure to the most innovative start-up, private or early stage lab grown food companies around the world.

Will you be part of the revolution?

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Visualizing America’s Electric Vehicle Future

The U.S. is accelerating its transition to electric vehicles but obtaining the minerals and metals required for EVs remains a challenge. In this infographic, we explore America’s transportation future.

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Visualizing America’s Electric Vehicle Future

The U.S. is accelerating its transition to electric vehicles (EV) to address climate change. However, obtaining the minerals and metals required for EV batteries remains a challenge.

In this infographic from Talon Metals and Li-Cycle, we explore the country’s strategy to have vehicles, batteries, and key parts be made in the United States.

Then, we look at how this strategy could be fueled by domestic mining and battery recycling.

The All-Electric America

Gasoline-powered cars are one of the biggest sources of carbon pollution driving the climate crisis. As a result, the Biden Administration has set a target for EVs to make up 50% of all new car sales in the U.S. by 2030. Today, fewer than 1% of the country’s 250 million vehicles are electric.

In November 2021, Congress passed the Bipartisan Infrastructure Deal, which includes:

  • Replacing the government’s 650,000 vehicle motor pool with EVs.
  • Electrifying 20% of the country’s 500,000 school buses.
  • Investing $7.5 billion to build out a network of 500,000 electric vehicle chargers across the country.

The idea also has popular support. According to a poll, 55% of voters in the U.S. support requiring all new cars sold in their state to be electric starting in 2030.

However, rising EV sales are already driving demand for battery metals such as nickel, lithium, and copper, threatening to trigger a shortage of these key raw materials. So, does the U.S. have the raw materials needed to meet this rising demand?

Currently, the U.S. is import-dependent with large parts of the battery supply chain captured by China. Likewise, some essential metals for EVs are currently extracted from countries that have poor labor standards and high CO2 footprints.

Nickel in the Land of Opportunity

The Biden Administration’s 100-day review of critical supply chains recommended the government should prioritize investing in nickel processing capability.

Today, the only operating nickel mine in the U.S., the Eagle Mine in Michigan, ships its concentrates abroad for refining and is scheduled to close in 2025.

To fill the supply gap, Talon Metals is developing the Tamarack Nickel Project in Minnesota, the only high-grade development-stage nickel mine in the country. Tesla has recently signed an agreement to purchase 75,000 metric tonnes of nickel in concentrate from Tamarack.

Since the development and construction of a mine can take many years, recycling is considered an essential source of raw material for EVs.

The Role of Battery Recycling

Battery recycling could meet up to 30% of nickel and 80% of cobalt usage in electric vehicles by the end of the decade.

The bipartisan $1.2 trillion infrastructure bill already sets aside $6 billion for developing battery materials processing capacity in the United States.

By 2030, the U.S. alone is projected to have more than 218,000 tonnes of EV battery manufacturing scrap and 313,000 tonnes of end-of-life EV batteries per year, presenting a massive opportunity for recycling. Currently, Li-Cycle, a leading lithium-ion battery recycler in North America, can process up to 10,000 tonnes of battery material per year—and this capacity is set to grow to up to 30,000 tonnes by the end of 2022.

Li-Cycle also has a hydrometallurgy refinement hub under construction in Rochester, New York, which will process up to the equivalent of 225,000 EV batteries annually into battery-grade lithium, nickel, and cobalt when it is operational in 2023.

America’s Electric Vehicle Future

The auto industry’s future “is electric, and there’s no turning back,” according to President Biden. It’s expected that EV sales in the U.S. will grow from around 500,000 vehicles in 2021 to over 4 million in 2030.

With rising government support and consumers embracing electric vehicles, securing the supply of the materials necessary for the EV revolution will remain a top priority for the country.

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