Significant Discovery

fowledup

fowledup

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Jul 21, 2013
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Forget significant disturbance for awhile. Lets say you made a significant discovery on your claim, you struck a vein or found a previously untapped placer deposit. I won't be quite as vague as the government, so we'll say a significant discovery would be one you wouldn't have the means to process yourself with your current set up. What would ya do? How would you handle it? What wouldn't you do? Sell the claim? Seek outside investors. Fill out the patent paperwork even tho there is a moratorium. How best would you protect the security of your claim.
This is all hypothetical food for thought and a topic I've never seen discussed on here before. NO we didn't and no the claims aren't for sale and we aren't looking for investors, lol. Simply a what if quandary I've always posed to myself, so lets see what others would do or have done. I am optimistic tho that one day.........
 

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I'd get to digging and keep my mouth shut. Quit the day job if you have to.

The most important part being, "keep your mouth shut".

If its a placer claim, maybe drop a lode over it. and keep my mouth shut.
 

Well I think it would depend on what level your mining is already at as well as how much you want to have to deal with the government. If your claim is all up to date and you've only been hands and pans so far then it may be time to consider stepping up the operations. How much will depend on several factors like which managing agencies you have to deal with, what kind of equipment is needed to work this discovery in the best way and how much capitol you have to work with.

Most of us know that hands and pans does not require a NOI or POO. When you start thinking of bringing in heavy equipment, then you're looking at a POO which can be a bear to get approved in many areas. Then there is also the reclamation bond that is most likely going to have to be posted if you bring in heavy equipment. So let's say you've managed to get the POO approved and have scraped up enough cash to post the bond. Now the terrain comes into play. What kind of equipment is needed to work the area in the most cost effective way? This would include earth moving equipment as well as your processing system. I'm a big fan of keeping mining operations as small as possible. Why get a D-12 CAT when a good backhoe is all that's really needed? Why bring in investors if you don't have to? There are a LOT of different factors that have to be considered before you step up your operation.

IMHO investors can be (and often are) a double edged sword. While they can help you get the capitol needed to work a major discovery, you're also responsible for making sure that they're kept happy and that they get their share of the profits. Depending on the size of the discovery, you could either work it on your own and have an income for life, or have investors pushing you to get every last grain of gold out of it as fast as possible.

The absolute first thing to do would be to "prove" the claim and have it ready to be patented if they ever lift the moratorium. Also check the adjoining lands if they are open to see if the deposit runs into them as well. If it does and they're open... snag them up as soon as possible. (Yet another reason for not telling anyone!)
 

It comes down to what do you consider significant... what are the values per unit of volume and what is the cost to process a unit of volume? ie if you can make an oz or two a day and fly under the radar as you do now for the most part, then that just may be the most viable option. If you can PROFIT $10 a yard and can, in glacier/gov time, get the process up and running to move 200 yards a day are you really doing any better? Now if you can up that to say 50 yards an hour then you might be onto something... IF you have enough good ground - that has been tested - to make it worth your while then, well then you just might have something......

ratled
 

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Keep it small, quiet, lean and mean. Silence is golden when it comes to mining in all forms now in kalif. Depending on form of deposit sets what your going to do next but if you get big you pay the price in way too many ways now as public disclosure puts the spotlight on your op and enviros start with the bloody stinkn' paperwork of injunctions, stays on and on and on. Sick anti-mining state we're in. John
 

I would prove and perfect the claim to prevent others from taking it from me.

Proving your claim doesn't require permits or public notice to any agency. It's the smart thing to do and standard practice among professional miners.

Heavy Pans
 

Hi Barry, does Land Matters include a guide to "Proving and Perfecting" a mining claim? If so I was unable to find it in the LM library. I think you may have posted an outline of the process on TN but I haven't found that either. When time permits could you link or post more info about this.

Thanks Barry,
Mike
 

Mike, I know Clay has a guide to placer claims evaluation in the library section (BLM_techbul4.pdf) There is also the Mineral Survey Procedures Guide (BLM_Min_Survey_1980.pdf)

These will give you lots of good info.
 

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The basics of proof and perfection of mining claims

delnorter said:
Hi Barry, does Land Matters include a guide to "Proving and Perfecting" a mining claim? If so I was unable to find it in the LM library. I think you may have posted an outline of the process on TN but I haven't found that either. When time permits could you link or post more info about this.

Thanks Barry,
Mike
Click to expand...

Yes Land Matters does have that information Mike but it's not in a tutorial or in the form of complete step by step instructions. I hope one day to write a more comprehensive article on the process.

The basis of perfection is described in the Land Matters Law Library and it's titled "The General Mining Law of 1872". That covers all the basic requirements to prove and patent your mineral claim - including the need to perform a mineral and boundary survey.

For more instruction about the industry standards to prove a placer claim you will find "Placer Examination, Principles and Practice" in the Mining Library describes best practices for proving the nature and extent of a placer deposit.

Basically once a valuable mineral deposit is discovered it's the responsibility of the locator to prove the nature and extent of the deposit. This is the exploration phase of perfecting your right to the deposit. Even though there is no time limit on this phase you only have a possessory right to the claim against subsequent prospectors or locators until you complete your proof.

It's important to understand that minerals already mined on a claim are not proof of a valuable deposit. They are only proof there may have been value in the past. To prove your claim you will have to establish the nature and extent of the unmined valuable minerals on your claim.

Once you have determined the nature and extent of the deposit (how much recoverable valuable mineral exists on the claim and where it is located in three dimensions) you will need to determine whether the now defined deposit would reasonably be worth mining. This phase is all about figuring the costs of mining, transportation, refining, marketing and rehabilitation of your deposit.

All of the above needs to be documented and organized in such a way as to be able to show government agencies and potential investors that the deposit has a certain value. This provides the "proof" aspect for your mining claim.

Once a mineral claimant has "proof" of the actual verifiable value of the mineral deposit claimed they are immune to mineral withdrawals even to the extent of National Parks or Wilderness designation. Even though the United States could still take the claim by eminent domain they would have to pay the full value of the proven valuable minerals minus the cost of extraction. These "takings" payments are not available to unproven claims. An unproven claim can only be defended against subsequent locators and uninvited prospectors - not against government action.

There are some pitfalls to look for in the proof stage. If you are considering selling investors shares in your future mining plans the standards of proof will include some rather strict SEC standards. The cost of mining changes with the cost of materials, labor and financing. The value of your mineral changes with the markets. These factors can make a paying deposit too expensive to mine and then you lose the values you have previously proven. A marginal deposit can be tricky and expensive to maintain.

The perfection stage is in the completion of the requirements to prepare for patent. A Mineral Survey can be completed even though Patent processing funding is suspended. You can find out the standards for Mineral Surveys in the Land Matters Mining Library by searching for the "Mineral Survey Procedures Guide".

That should give you a good basis for understanding the process. Mining companies, from the very beginning, approach each deposit with the intent of proving the value in place. It's how the laws and the mining economy has been structured for more than 150 years. It's done every day as a profession by thousands of people in the United States. Even a small miner can accomplish these simple tasks to proving their claim. Our ancestors did it with picks and shovels. :thumbsup:

Heavy Pans
 

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Keep your mouth shut, keep working, and don't show your poke to anybody!
 

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