Mineral Estimates – Reserves vs Resources


When you’re reading financial statements and company presentations, you’ll notice some closely related terms being referenced: mineral reserves and mineral resources.

What’s the difference? In short – mineral reserves are the portion of mineral resources that are economically feasible to produce and sell.

Relationship between Mineral Reserves Mineral Resources.png

Relationship between Mineral Reserves and Mineral Resources


It's best to understand these terms yourself so that you can properly evaluate all information related to mining operations, development projects and potential exploration opportunities.

From the CIM Definition Standards for Mineral Resources & Mineral Reserves 2014:

A Mineral Resource is a concentration or occurrence of natural, solid, inorganic, or fossilized organic material in or on the Earth’s crust in such form and quantity and of such a grade or quality that it has reasonable prospects for economic extraction. The location, quantity, grade, geological characteristics, and continuity of a Mineral Resource are known, estimated, or interpreted from specific geological evidence and knowledge.

Mineral Resources are sub-divided, in order of increasing geological confidence, into InferredIndicated, and Measured categories. Note that the confidence level in Inferred Mineral Resources is insufficient to allow the application of technical and economic parameters or to enable an evaluation of economic viability worthy of public disclosure.

A Mineral Reserve is the economically mineable part of a Measured or Indicated Mineral Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information on mining, processing, metallurgical, economic, and other relevant factors that demonstrate, at the time of reporting, that economic extraction can be justified. A Mineral Reserve includes diluting materials and allowances for losses that may occur when the material is mined.

Mineral Reserves are sub-divided in order of increasing confidence into Probable Mineral Reserves and Proven Mineral Reserves. Mineral Reserves are those parts of Mineral Resources which, after the application of all mining factors, are the basis of an economically viable project after taking account of all relevant processing, metallurgical, economic, marketing, legal, environment, socio-economic and government factors.

As always, do your due diligence, and remember the differences between the types of mineral estimates.