There seems to be a lot of confusion among resource investors regarding what is considered “high grade”—and not just because it varies by metal. I suspect there are aggressive promoters out there making things worse by describing projects that are not really high grade as “high grade for this region,” or “high grade for this mine,” and so forth.

Let’s see if I can help…

The #1 thing to be clear on is that open-pit mining is much cheaper than underground mining. That makes what’s considered high grade for near-surface (open pittable) deposits very different from high grade for deposits that would have to be mined underground.

The other thing to keep in mind is that some minerals are much more expensive to extract metals from than others. There are specific minerals like enargite, which is notoriously hard to process. I check with a geochemist when I’m not familiar with the minerals in a deposit I’m looking at.

One major category that’s easy to watch out for is refractory ore. I’ll skip the technical details, but suffice it to know that such ores often require expensive treatment like roasting in an autoclave before the metals can be extracted. Refractory ores are common and how to handle them is well understood, so don’t take this as any sort of kiss of death for a project. It just means that the grades need to be higher to pay for the extra processing.

Another major category to watch out for is polymetallic ore. When ores contain more than one metal, it can complicate extraction. Miners usually have to pick one metal to concentrate on to maximize the value extracted, at the expense of others that would be more difficult or expensive to recover—if they can be recovered at all.

For example:

• Gold and silver often occur together (frequently as an alloy called electrum). Maximizing gold recoveries often means giving up a lot of silver recovery.
• If there’s copper and gold together, you can run into the problem of the copper using up cyanide before it gets to liberating the gold.
• If you have a bunch of metals together, like a VMS-type deposit with lead, zinc, copper, gold, and silver, there’s no way you can optimize for all of them. When explorers convert all of these metals to gold-equivalent, assuming 100% recovery of each, it results in a much higher-grade number than could ever be recovered.

This may all sound complicated, and honestly, it is. That’s why I want to see a detailed feasibility study before I back a project developer planning to build a mine.

That said, I have my own rules of thumb I’m happy to share with you.

Gold

Open pit:

• 0–0.5 g/t gold is low grade
• 0.5–1.5 g/t gold is average grade
• Over 1.5 g/t gold is high grade

 Underground:

• 0–5.0 g/t gold is low grade
• 5.0–8.0 g/t gold is average grade
• Over 8.0 g/t gold is high grade
• Gold measured in ounces per tonne is “bonanza” grade.

Silver

Open pit:

• 0–30 g/t silver is low grade
• 30–150 g/t silver is average grade
• Over 150 g/t silver is high grade

 Underground:

• 0–150 g/t silver is low grade
• 150–350 g/t silver is average grade
• Over 350 g/t silver is high grade
• Silver measured in kilos per tonne is “bonanza” grade.

Copper

Open pit:

• 0–0.5% copper is low grade
• 0.5–1.0% copper is average grade
• Over 1.0% copper is high grade

Underground:

• 0–1.0% copper is low grade
• 1.0– 3.0% copper is average grade
• Over 3.0% copper is high grade

I should stress that these are not international standards set by some geological authority. These are my numbers, based on what I’ve seen in the field.

More important is that, as above, these numbers are just a starting point. If the ore is refractory, I want to see higher grades. If it’s polymetallic, I want to see higher grades of the most valuable metal (by price and quantity) in the mix. And so forth…

That’s my take.