The Ore Sorter Advantage

Imagine if you, like Canadian Critical (CCMI.V) had a large stockpile of previously mined material at surface which was all, to some degree, mineralized. You knew you could truck that material 400 miles to a mill and be paid for the metal it contained. But trucking 400 miles is expensive, and if the average grade was, say 1% Copper, while it would be economic to mill it on site, it would be a losing proposition to transport it. But what if you could upgrade to 3%? Now you’re in business. Which is exactly what Ian Berzins, CCMI’s CEO, figured out.

CCMI was lucky as it happened that Bayhorse Silver’s (BHS.V) Steinert ore sorter was sitting idle in Oregon as BHS waited for its mining permit. A deal was done and the sorter moved to the Bull River mine. Using the sorter, CCMI has made well over 1 million dollars processing a fraction of its stockpile. Berzins could afford to “high grade” the rock he was sending by setting the sorter to reject good, but not great, rock. He could do this knowing that his own, on site, mill would process the “rejects”.

Ore sorting is a well understood technology which is constantly improving and proving its value in various special situations. A Steinert ore sorter is an advanced sensor-based sorting system designed to separate valuable minerals from waste rock in mining operations, improving efficiency and reducing costs. Here's how it works. First, you crush the rock down to a specific size range, typically 25-100mm. That crush is fed into a scanner, which can be set to detect and identify particular minerals. The Steinert sorters can use X-Ray transmission to penetrate particles up to 100 mm, detecting differences in density or elemental composition. This can be combined with X-Ray Fluorescence to detect specific chemical elements and optical scanners and lasers to detect visible differences like colour (e.g., copper oxide) or crystalline structures (e.g., quartz).

The information from the various scanners is the data used to select the material of interest, which is then, literally, blown over a splitter plate into separate streams, waste and concentrate. Once calibrated, Steinert (and other companies’) ore sorters can operate at quite high speeds. Steinert ore sorters typically process between 20 to 150 tonnes per hour per meter of conveyor belt width.

Bayhorse originally purchased its ore sorter to take advantage of an Oregon regulation which exempted mines which removed less than 5000 tons of material per year from their property from the requirement of obtaining a full mining permit. Graeme O’Neill’s logic was that BHS would sort the Bayhorse Mine material and only ship high-grade so as to stay under the 5000 ton per year limit. (This clever plan was undone when the footprint of the Bayhorse mine was found to exceed 1 acre which was the limit for the exemption.)

There are plenty of use cases for ore sorting. For example, Philippe Cloutier over at Cartier Resources (ECR.V) published a 43-101 Compliant Preliminary Economic Assessment of what was then its Chimo Mine project. Ore sorting was included in the Assessment with the sorted material going “to the processing plant. The sorter is expected to operate with a concentration ratio of 1.85 a recovery rate of 91.9%” In the PEA the CAPEX included $112 million dollars for that plant. But, realistically, Chimo is located in Val d’Or, where there are several mills with spare capacity within a hundred miles.

The 2023 PEA lists an average grade of 3.14 gpt AU. If Cloutier uses a sorter to upgrade that to close to 6 gpt, using a current price of $100 USD/gram, that is $600 a ton rock. Well worth the shipping cost.

Cartier has also announced that it is examining the potential economic value of the tailings and waste rock at the Chimo mine site. The mine operated, on and off, from 1964 to 1997, producing 379,012 ounces of gold. Typically, in that era, the material would be “high graded” with less interesting material diverted as “waste”, which means there is the possibility of 5-15 gpt rock sitting at the surface ready for processing. Of course, there was also a lot of rock which really was “waste”. Deploying an ore sorter to separate the wheat from the chaff before sending it on to a mill may make a lot of sense.

There are two, major, drawbacks to ore sorting. First, the cost of the sorter itself. Bayhorse’s cost a little over a million dollars and they go up from there. Second, a minimum of one year, often two, from the time an order for a sorter is placed to delivery and setup.

Companies which think a sorter may make economic sense almost always run tests to ensure that their rock is amenable to sorting. Tom Larsen’s Eloro (ELO.T) did extensive testing on what looked to be refractory tin material. Those tests, at TOMRA GmbH in Germany, another ore sorter maker, were successful but, it turned out that the bulk of the tin deposit at Iska Iska in Bolivia was in non-refractory visible coarse-grained high temperature cassiterite which is likely to be amenable to gravity separation. Which was very good news for ELO.

The critical thing about ore sorting for investors is that it has to provide economic advantage to a mining project which already makes economic sense. Ore sorting acquired a bit of a stigma when owners of marginal projects invoked the magic of the ore sorter to pump the project’s tires. Economic advantage can and should be measured. Upgrading material to be transported has a measurable economic gain. Sorting already mined rock into waste and economic grade may make sense if there is a strong indication that there is an economic quantity of that economic grade. Using a sorter in a polymetallic deposit to pull the silver from the tin, from the zinc, and the lead may make a lot of sense.

(Disclaimer: I own shares in Canadian Critical, Bayhorse Silver, Cartier Resources and Eloro. I may buy or sell at any time. This is not investment advice. Do your own due dilligence. Call the CEO.)