The exploration for gold involves drilling test holes in target area and then measuring the grade of the metal that can be extracted from the mine should it be brought to production. The goal of such exploration, finding the high grade deposits which can be mined for significant profits. The economic viability of a mine will depend on the grade of metal that can be extracted relative to the cost of extraction. In some cases, a grade rating of high grade gold is used to indicate that it is sufficiently above the cost to make the mine viable.
How Grades Are Reported
The amount of any given metal in a geological survey or assay is most commonly measured in grams per ounce. These levels are reported for various depth ranges in an effort to give a clear picture of what may lie beneath the surface. The mining company does not wish to heavily invest in taking a mine to production if the yield from the mine will not be sufficient to justify the time and expense. At any given depth, the concentration is reported for a number of meters for which the finding holds. For example, the report may read 5.0 grams per ton at 350 meters for 30 meters. This would indicate that there is the presence of the desired mineral at the stated concentration and depth.
Low and High Grade Gold Ratings
High grade gold or low grade gold can have very relative meanings, depending upon the context in which they are used. While a rating of 10.0 g/t Au would be universally considered quite high, a reading as low as 3.0 g/t Au might also qualify. This is where context comes dramatically into play and why the individual reviewing the data must be careful in understanding the data that he or she is considering. The rating may be high on an absolute basis, high relative to other depths for which positive readings were achieved or high relative to the cost of production. With gold prices having recently flirted with all time highs, while production costs have remained somewhat stable, finding a grade that is high enough to justify the project is far easier. In this latter context, the term high is used fairly liberally, especially because while the assay itself is important, what is written about the results is commonly used for the benefit of investors. Placing the term in proper context is, therefore, a critical step in properly evaluating results.