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TORONTO – The shareholders of Pretium Resources Inc. were rattled on Wednesday after one of Canada’s most respected teams of geologists severed ties with the emerging mining company and its heavily-hyped gold project in British Columbia. Pretium announced that Strathcona Mineral Services Ltd. resigned from its role as “Qualified Person” on a sampling program for the Brucejack project. The move cast a cloud over the project, and Pretium shares plunged 30.5%.
Strathcona was brought in as an independent consultant to oversee and report on Pretium’s bulk sample project. The independent verification is required under Canadian mining disclosure rules, and Toronto-based Strathcona is known for its conservative and disciplined approach.
Strathcona did not respond to requests for comment. But Pretium chief executive Robert Quartermain downplayed the resignation and maintained the Brucejack project is on track. “We’re in a situation where we have a disagreement between two Qualified Persons with regards to reconciling the bulk sample with the resource estimate we have,” he said in an interview.
If nothing else, the situation highlights the unique role of the Qualified Person in assessing mining projects. These people have an enormous impact on how projects are interpreted by investors, but do not always agree among themselves on how data should be interpreted.
Pretium hired both Strathcona and Snowden Mining Industry Consultants to do independent work on the “Valley of the Kings” discovery within the Brucejack project.
Snowden, based in Perth, Australia with Canadian offices in Calgary and Vancouver, prepared a resource estimate for Valley of the Kings last year, which led to a feasibility study that identified reserves of 6.6 million ounces. The next step was to process a bulk sample to get a further understanding of the deposit.
Strathcona was brought in and clashed with Snowden about how to conduct it. Put simply, Strathcona wanted to take a small sample for analysis, while Snowden wanted to use the results from the entire 10,000-tonne sample that is being processed through the mill. The two sides disagreed, and Snowden has taken over duties on the bulk sample.
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