| We invite everyone reading this to watch our recently updated short video with new information about the ongoing roll-out of the virtual SEM Course. This link takes you to the web page where you will find that video: https://www.wesminllc.com/wms-sponsored-events/ As you can see, Classes 1 and 2 are up and running with Class 3 to follow shortly – by 30 September 2021 at the latest. In addition, we have made some logistical changes to the virtual Course. Please note that some changes described below are recent and override some of the information in the video: 1. We have decided to keep all three Classes open for enrollment at any time for a two-year period – i.e., through 30 March 2023. At the end of that period, we will edit and update the Classes and then re-offer them for another two-year period. 2. Enrolling in any particular Class also provides access to Short Subject Packages for that Class. In these Packages we drill down and provide extensive additional detail on selected topics covered in the Class. 3. The Class 1 Short Subject packages are complete and available through the WMS Institute site. Two of the three Class 2 Short Subjects packages are now also available through that site. 4. Once Class 3 is up and online, there will be Short Subject packages for that Class as well. Understandably, there have been many questions about the timing and logistics of the Workshops for each of the Classes. Our current plan for the Workshops is this: 1. We will run Workshops for all three Classes during October, November and the first half of December. If this timing works, we will try to do the same each year. 2. Suggested topics for each Workshop will be announced in advance, but we will try to remain flexible so that the scope of each includes topics that participants want to cover. 3. During that two and a half month period, we will offer at least two Workshop topics per Class. 4. We intend to offer each Workshop twice, at 6:00 hours and at 18:00 hours New York City time, so that we can accommodate the various time zones of the participants. Our goal is to offer the first SEM Course Certification Exercises during the first quarter of 2022, i.e., after the Workshops. That’s it for now, but please remain vigilant for further updates, and if you have questions contact Jeff (jeff.welborn@wesminllc.com). Thank you all for your patience and understanding. Jon, Brad, Steve and Jeff |
WMS Responds to COVID-19
Like most global service providers, we at Western Mining Services are working to adapt our business in response to the pervasiveness and the significant health risks that characterize COVID-19 — a major challenge. We remain committed to providing training services and products, but we must do so now without a face-to-face classroom component, at least until it is once again safe to travel and gather.
Here’s where we are as of 15 February 2021:
- The Perth and Denver SEM courses are postponed indefinitely.
- We have put together and are now offering a comprehensive new on-line Senior Exploration Management (SEM) Course. See the Events Page on this website for details.
This new project does not mean that we will abandon our traditional in-person SEM Courses. There is too much educational value in the opportunities those courses offer for participants to be together to share ideas and experiences.
If you are interested in our SEM Courses, please contact Jeff Welborn by email (jeff.welborn@wesminllc.com) for scheduling and enrollment details.
We have confidence that the COVID-19 crisis will become manageable and that all of our training services and products, both in-person and on-line, will become available to all who want to participate. We are grateful to our past SEM Course participants, and we thank those who have an interest in attending in the future.
To all of our clients, course participants and other friends, be in good health and please follow the new rules we all must live by to stay that way.
Scientific Concept-based Exploration for Gold
Mineral Exploration Financing — we need a new model
Mineral Exploration Financing – we need a new model
The “capital strike” that currently affects the junior exploration sector continues to deepen with the result that exploration risk capital is currently very difficult to obtain. The reason? The way we, as an industry, finance early stage exploration in the global junior sector is inefficient, wastes capital and is no longer working.
Our incentive is to tap into the large amount of sophisticated risk capital that currently avoids early stage exploration like the plague. To do so, we need a new approach that links this risk capital to strong projects through an interface of trust — trust that capital will be allocated effectively and that less reputable parts of our industry will be screened out.
The approach that WMS proposes is the Exploration Aggregator Model:
The key to this model is that within the Aggregator, between sophisticated risk capital and a portfolio of early stage exploration projects operated by junior companies, there sits a trusted third party. The role of the Aggregator is twofold:
- Select, carefully and with skill, the best exploration projects for investment, then
- Ensure these projects are advanced with the best science and technical discipline.
The Aggregator may be directly owned by the sophisticated risk capital, it may be a specialist third party or perhaps could be a division of a major mining company that is dedicated to this function (in that case, also tapping capital from the parent company). What is important is that the Aggregator must possess and integrate these capabilities: financial literacy, strong strategic understanding of mineral exploration, and world-class technical skills. Collectively, these capabilities earn the trust of the investor.
Please follow this link to our most recent Paper for more on this topic and why we at WMS support this Aggregator Model. Learn why we conclude that, in the context of this Model, early stage mineral exploration, investment in a high quality well-managed early-stage exploration portfolio, is actually a low risk investment, which should attract the sophisticated risk capital investor, when compared to the large, high risk investment typically required to test viability of one advanced project that in all likelihood has little chance of successful development.
The Opportunity in Exploration- Grade is Still King
Over the past few decades, the old adage “grade is king” has been gradually replaced with “big is king”. There are a number of justifiable (at the time) reasons for this but the end result is a global accumulation of generally large and low grade mineral occurrences. Compounding the grade-challenged character of many of these occurrences is the fact that they are increasingly discovered in geographically difficult locations, e.g. remote areas, high altitude, rain forest, adjacent to glacial ice, etc.
There are many mineral projects in a number of commodities that stand little chance of advancing to mining because the return characteristics and risk profiles will not justify the required capital expenditure, let alone any purchase price expectations on top of that. These projects cannot withstand the rigors of commodity price cycles and the tortuous, time-consuming and expensive pathway that must be navigated before they can become fully permitted, financed and socially accepted in today’s world.
Perhaps it’s not the case that the mineral exploration industry lacks discovery, but rather that we are discovering the wrong things. In addition, lack of technical and economic discipline too often means that these discoveries are drilled-out and even advanced through feasibility, when in reality the project should have been stopped early-on. This degrades exploration performance over the long run and wastes capital that could be deployed to discover higher-quality deposits.
In an urbanizing world that will continue to require increasing quantities of minerals and metals, there is an opportunity for well-managed mining and exploration companies to develop profitable enterprises by discovering and extracting high-quality mineral deposits. Our view is that this presents a major opportunity for mineral explorers to re-focus and learn how to target for and discover higher-quality deposits. Higher-quality does not necessarily imply smaller size, but in most cases it does imply higher grades and/or multiple metals.
Of course this is easy to say and not so easy to do. The challenge is to create conditions that generate, nurture and fuse a combination of skill, learning, discipline, luck and patience to achieve a discovery track record that delivers significant new wealth. Companies and exploration groups who accept this challenge and excel will be the mineral exploration success stories of the future.
The Essential Role of Good Commercial Risk Management
In the mineral exploration industry, we accept the reality that the probability of greenfield discovery success is usually less than 1%. In non-statistical terms, we say that significant technical risk confronts each promising, untested, geologic idea/opportunity/prospect.
An additional reality, however, is that the probability of economic success for each geologic prospect is even lower than the probability of discovery success. Some say that the probability that a good geologic prospect will actually become a world-class mine is less than 0.01%. This significant economic hurdle is often due to the non-technical uncertainties and risks (community, security, title, environmental, political, etc.) that could, and probably will, have an adverse impact on economic value as the geologic prospect moves through the exploration stages.
These statistics put a premium on the quality of the process that the explorationist uses to gather and assess the non-technical (non-geoscientific) information that is relevant to testing and (hopefully) developing and producing what starts out as a promising greenfields opportunity. At WMS, we call this process Commercial Risk Management (CRM).
It is not sufficient for the mineral explorationist merely to have a placeholder for CRM. The actual CRM process must be performed efficiently and with skill and objectivity. It must be tailored to each project so that the information gathered is complete, accurate, and useful for that particular project. It must be grounded in the assumption that the quality of the CRM result makes a significant difference in the effort to expand exploration search space and increase the probability of economic success for technically sound greenfield opportunities.
Most important, the CRM process must yield value, and to do so the explorationist must see CRM for what it really is: a core component of the mineral exploration process that continues throughout the project life as the stakes get higher and the need for informed decision-making increases.
CRM does not always have this stature, and the result is CRM failure that leads to project failure, or project delay that is tantamount to project failure. WMS strongly believes that project delay or failure, and accompanying value destruction, can be largely avoided through a well-designed, resourced and implemented CRM process that is an integral part of any exploration strategy and business plan.
The ultimate goal: Avoid pursuing projects that cannot become viable mines despite technical exploration success.