How Mine Investing Works.

1. Assemble clean technical records — resource estimates, mine plan, operating and cost data.
2. Benchmark against the market so the story is honest and defensible.
3. Tidy compliance — permits, reclamation status and community agreements in good standing.
4. Confirm tenure & royalty standing — clean title and clear encumbrances sell for a materially better price.
5. Set the marketing thesis — operating asset, development project, or exploration package.

Preparation is cheap; a messy data room is expensive at the valuation table.

1. Assemble the data room — technical reports, financials, permits, and the opportunity story.
2. Select the advisor / broker — fee, process, confidentiality.
3. Build the buyer list — majors, mid-tiers, private equity, royalty & streaming houses.
4. Launch the process — controlled first round under NDA.
5. Field Indications of Interest (IOIs) and qualify them.

Discreet, well-targeted marketing creates competition — and competition sets the price.

1. Review letters of intent — price, structure, deposit, certainty.
2. Recap the field — push secondary offers to improve the lead.
3. Negotiate the purchase agreement terms beyond price.
4. Select the winner weighing price against probability of close.
5. Execute the PSA and release back-ups.

The highest LOI isn't always the best deal — it's the one that closes.

1. Cooperate with buyer diligence — data room and site access on schedule.
2. Respond to title, technical and environmental findings.
3. Negotiate adjustments — working capital, inventory, royalties, prorations.
4. Coordinate permit & consent transfers of the new ownership.
5. Close — documents, title, workforce, operating continuity.

A smooth close earns a reputation that matters for the next deal.

1. What it is — an estimate from wide-spaced drilling and sampling, based on geological inference with no demonstrated continuity of grade or tonnage.
2. What it's worth — essentially zero to a lender, and heavily discounted by investors. It is option value — a bet that more drilling confirms it — not economic value.
3. The trap — an inferred-heavy deposit looks enormous on a headline number but is worth a fraction of the same tonne at higher confidence. Naive investors chase the big number; the sophisticated ignore it.

The rule: inferred is a reason to drill, never a reason to lend or to raise on. It cannot be converted into a reserve until the drilling closes the gaps.

1. What it is — closer drill spacing gives reasonable confidence in grade and tonnage continuity at a local scale.
2. What it's worth — this is where the real value starts. Measured + Indicated (M&I) is the core number investors and strategic buyers underwrite.
3. Where it leads — indicated (together with measured) is what feeds the Probable Reserve after economic factors are applied.

The turning point: a project that can show a meaningful M&I resource stops being a story and starts being an priced asset.

1. What it is — tight drilling and well-understood geology give the highest level of geological confidence in tonnage, grade and shape.
2. What it's worth — the least-discounted tonnes. This is the rung lenders and sophisticated capital trust most, because the geologic risk is largely retired.
3. Where it leads — measured is what feeds the Proven Reserve — the single most bankable category in mining.

The distinction that matters: a deposit can have huge measured tonnage worth a premium, or huge inferred tonnage worth pennies — the mix between the two decides the asset's real standing.

1. What it is — the economically mineable part of Indicated (and some Measured) resources once the modifying factors are applied — mining, metallurgy and recovery, economics, marketing, legal, environmental, social and governmental.
2. What it's worth — this is a reserve, not a resource: economically viable and mineable, not just geologically present.
3. Where the money lives — lenders size reserve-based debt against Proven + Probable (P&P). A project without credible P&P reserves struggles to attract bank debt at all.

Reserve conversion is where a "find" becomes a fundable mine — and it is the single clearest signal of engineering and economic credibility to a lender.

1. What it is — the economically mineable part of Measured resources after the same revising factors — the highest-confidence, highest-assurance tonnes.
2. What it's worth — the top of the ladder; these tonnes draw the lowest discount rate and the most favourable debt terms.
3. Why it anchors a raise — a financing story built on proven reserves is financeable in the strongest sense: bankable, offtake-backed, and underwritable at a defensible value.

The whole game is climbing this ladder: each rung up de-risks the project, lowers the discount rate, and raises the value of every tonne.

1. Lenders lend against reserves, not resources — Proven + Probable (P&P), never inferred or raw resource. Debt is sized on P&P at a conservative price and a defined mine plan, with reserve tests and coverage covenants.
2. Too inferred = no bank debt — a project short on credible P&P reserves can't attract debt at all, so the capital must come from equity, streaming, royalties or offtake instead.
3. The lender's key tell — the resource-to-reserve conversion ratio (how much resource survives as economic reserve) tells a lender whether the deposit can actually service a loan.

Reserve conversion is the single clearest signal of engineering and economic credibility a lender reads.

1. Investors price on the M&I core — Measured + Indicated is the core of value, measured most of all. Inferred adds headline size but is heavily discounted, treated as pure upside with little valuation weight.
2. The red flag — a raise pitched on a big inferred number without a demonstrated M&I core is a classic warning sign.
3. Upgrade = re-price — every upgrade (inferred→indicated→measured→reserve) is a de-risking milestone that lets the company re-price at a higher per-tonne value and a lower cost of capital.

Sophisticated investors will happily pay more per tonne for confidence they can verify — and little for size they can't.

1. The discount rate tracks risk — the same tonnage at higher confidence carries higher value, because lower risk means a lower discount rate and a higher NPV on the same ounces or tonnes.
2. Buyers underwrite the payable core — in an off-market sale, the buyer pays for Measured + Indicated as the core, and only a small fraction for inferred tonnes.
3. Widens in weak jurisdictions — the confidence discount grows where geology, tenure, governance or access to capital are weaker.

Two identical-looking deposits can differ in price by multiples purely on where they sit on the confidence ladder.

1. Verify working capital & inventory — confirm the cash, ore stockpiles and product you were handed.
2. Own payroll & benefits — cleanly transfer the workforce and obligations.
3. Lock operating systems & data — mine plans, assay data, and production systems under your control.
4. Confirm permits & regulator contacts — mining, environmental, water and land-use channels.
5. Baseline every metric — grade, tonnage, recovery, AISC and production on the first stable month.

The first thirty days are about control and baseline — make sure nothing is running on borrowed accounts or goodwill.

1. Apply your operating plan — start moving grade control, recovery and cost toward your plan, not someone else's.
2. Align the management team — set targets, authority and reporting for the mine manager and department heads.
3. Tackle immediate capital — the small fixes with fast ROI; schedule the larger sustaining work.
4. Reconfirm offtake & sales channels — concentrate, product and market contracts.
5. Review vendor & supply contracts — renegotiate what the prior owner overpaid for.

Month two is execution. Move deliberately so the steady-state numbers (what your financing was sized on) actually arrive.

1. Drive grade & recovery — measure months 2–3 production against the technical report you underwrote.
2. Begin the capital schedule in earnest and track draw/usage against the plan.
3. Build the reserve & reporting rhythm your lender expects — monthly packs, cost-per-ounce commentary.
4. Lock the management accounting — forecasting, budget vs actual, and AISC tracking.
5. Set the 12-month plan — capital, production, hedging and the path to permanent refinance or hold.

By day 90 you should have a stable, documented, improving mine — the position from which permanent financing and the exit value are built.