Drill results explained: how to read a mining press release

"Drills 42.5 metres of 3.1 g/t gold, including 4.0 metres of 18.6 g/t." Lines like that move junior mining stocks more than almost anything else. Read carefully, they tell you a lot. Read quickly, they can mislead. This guide breaks a typical drill release into its parts and shows how to judge each one.

The basic parts of an intercept

Every reported intercept has two core numbers.

• Interval length: how far, in metres, the mineralized section runs along the drill hole. In the example above, 42.5 metres.
• Grade: the concentration of metal. Precious metals are usually quoted in grams per tonne (g/t). One g/t is one part per million. Base metals such as copper, zinc, and nickel are usually quoted as a percentage.

The release should also give the hole's collar location, its azimuth (compass direction) and dip (angle), and the depths at which each interval starts and ends. Canadian disclosure rules require these details for material properties. Without them you cannot tell whether a hole extends the deposit or simply re-drills ground already known.

Gram-metres: a quick way to compare holes

Grade times width gives a single figure, commonly called gram-metres (or percent-metres for base metals). It lets you compare a short, rich hole with a long, modest one.

Gram-metres are a screening tool. They ignore depth, metallurgy, the price of the metal, and whether the intercept connects to anything else.

True width vs core length

A drill hole rarely hits a mineralized zone at a right angle. When it crosses at a shallow angle, the length of core through the zone is longer than the zone is thick. That longer number is the core length. The real thickness is the true width.

Disclosure rules require companies to state true widths when they are known. Early in a program, the geometry may be unclear, and a release will say "true widths are not yet known" or give an estimated percentage. That is honest, but it means the headline length may overstate the zone.

Cut-off grades and "including" intervals

Cut-off grade

To report an interval, the company decides where mineralization starts and stops. It typically uses a cut-off grade, a minimum value below which samples are not counted, and rules for how much lower-grade "internal dilution" it will allow inside an interval. Change the cut-off and the same hole can be reported as a long, modest interval or a short, rich one. A good release states the cut-off and the dilution rule.

"Including" intervals

Companies are expected to show higher-grade sections inside a lower-grade intersection. That is useful. But watch for an "including" figure that carries most of the metal. If 4 metres at 18.6 g/t sits inside 42.5 metres at 3.1 g/t, the high-grade core holds about 74 of the 132 gram-metres. Strip it out and the remaining 38.5 metres average roughly 1.5 g/t. Both facts matter.

Grade capping

One very high-grade sample can inflate an average. Some companies report averages with high values capped (or "top-cut") at a set level and say so. If a release does not mention capping on a nugget-prone gold deposit, compare the capped and uncapped picture when the technical report comes out.

Assays vs visual estimates

An assay is a laboratory analysis of a sample. It is the only basis for a reported grade. Before assays return, which can take weeks, some companies release descriptions of what geologists see in the core: percentages of visible sulfides, visible gold, or similar. Visual observations are not grade. Sulfide percentages do not translate directly into copper or nickel grades, and visible gold can be spectacular in a few spots and absent from the rest. Treat any pre-assay release as a preview and wait for the lab numbers before drawing conclusions.

QA/QC: why the boring paragraph matters

Near the bottom of most releases is a paragraph on quality assurance and quality control. It should cover:

• How core was split and sampled, and the sample interval.
• The laboratory name and location, its accreditation, and whether it is independent of the company.
• The analytical method, such as fire assay for gold.
• Insertion of certified standards, blanks, and duplicates to catch lab errors and contamination.
• The name of the qualified person who approved the technical content.

Regulators list missing collar data, missing true widths, missing QA/QC, and failure to name the lab among the common disclosure problems. If several are absent, be skeptical.

A reading checklist

1. Find the full results table, not just the headline. Rules expect balanced disclosure, including weak and "no significant" holes.
2. Calculate gram-metres for the main interval and for the interval without its "including" section.
3. Check whether lengths are core lengths or true widths.
4. Note the depth. A great intercept 900 metres down is a different proposition from one at 50 metres.
5. Locate the hole on the company's map. Is it extending the deposit, filling in, or testing something new?
6. Read the QA/QC paragraph and confirm assays, not visuals, underpin the grades.
7. Watch for metal-equivalent grades. If a release reports "gold equivalent," look for the metal prices and recoveries used, and the grade of each metal separately.

Drill results feed the resource estimate described in our guide to reading an NI 43-101 report. For where drilling sits in a company's life, see how junior mining stocks work, and for hype to avoid around big results, see our promotion red flags. Unfamiliar terms are defined in the glossary.

Educational content only, not investment, tax or legal advice. The Stateside Report does not recommend buying or selling any security. Tax rules depend on your situation; confirm with a qualified tax professional. Full disclosures.