Resource "cut-off" grade..... It has been stated, that I/we should have informed readers here that management lowered the Roche Bay resource cut-off grade from 25% to 20%......supposedly to raise the resource itself!
Well, anybody that has read the news releases and/or reports, would be very aware of this change that took place last spring.
But, the problem with this statement is......it was not management who decided upon a lower cut-off grade, but the geologists! Management does not have the power or authority to do such a thing. And the geologist made this decision, based upon numerous fundamental changes. 1) as more and more mineral definition is performed.....ie: lab work and flow sheets......a geologist becomes more confident in the resource; 2) the proposed iron product changed from 96% iron content nuggets to 65% iron content concentrate.
But, I suspect the primary reason for the geologist choosing a lower cut-off grade was to be more in line with their respective peers. For example.....even today......Alderon [ADV] is using a cut-off grade of 20% in their first initial resource estimate, as is Century [FER]; Adrianna [ADI] is using 18%, as is NML; and Champion [CHM] is using the very lower cut-off grade of 15%, as was Consolidated Thompson before they entered into production. And all of these explorers/producers are targeting a iron concentrate production.
Up until last spring, AXI was the only iron ore developer that I was aware of, that was strangely using the higher cut-off grade of 25%. But there is nothing stopping any investors from performing their due diligence on AXI, based on a cut-off grade of 25% if you so desire. But be sure to apply that same quantifier to all your other inquiries as well.
Blessings,
Murray