The Mining 101 Masterclass by The Net Worth Club

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When I first got involved in the markets, I didn’t start with newsletters or university educations, I started with a phone.

After turning 20, I started my second job and was working at an investor relations firm making 300 cold calls a day trying to convince strangers to buy junior mining stocks.

That’s what started my “toughness.”

It was the Wild West, and that was only 2007. (I can only imagine really back in the day)

Every pitch had a story…

Every management team had a dream…

And I got a crash course in not only what separates a real discovery from another average at best looking powerpoint, but marketing, promo/IR and communications.

From there, I graduated to my first brokerage firm, a small shop that specialized in early stage mining finance and a lot of OTCBB trading.

I traded stocks and as an assistant and then rookie broker, I helped raise money for early stage explorers.

Eventually I landed at Canaccord, which at the time, was ground zero for global mining finance.

It was all mining, all the time.

Between 2008 and 2014, I helped finance over 100 junior mining companies, from the Yukon to Tanzania.

I’ve seen great stories, terrible stories, and everything in between.

That’s where I learned the bones of this business.

And that’s what this guide is about: giving you the real framework behind mining.

From exploration to production.

If you’ve ever chased a gold breakout, bought into a junior with a fresh deck and a big promise, or just stared at a drill result wondering, "is that good?" or “what the hell does that even mean?” this guide is for you.

Because here’s the truth.

Most retail investors don’t understand mining.

Not really.

They see a few grips and grabs…

They see headlines, but not the nitty gritty of it.

But if you want to find the ten baggers… the real wealth building trades, you need to understand the whole process, from exploration to production.

You need to understand, the lassonde curve.

Let’s dig in.

1. How Mining Companies Are Born

Before a single discovery is made, someone needs to fund the dream.

And that happens in places like Vancouver, BC, the global epicenter of speculative and early stage mining finance.

Between the TSX and TSX Venture, Canada hosts more than half the world’s public mining companies.

Why?

Because the system is built to fund early-stage risk.

Cheap shells, retail liquidity, and brokers who specialize in raising money for assets this early stage.

Here’s how it works:

• Find a target area. Maybe it’s an old mine, a project generator, or a new geophysical anomaly you heard through word of mouth
  

• Negotiate a land package. This could involve staking new claims, buying old rights, or optioning ground from locals or other juniors. Terms are often staged e.g. $250K upfront, $1M on xyz milestone, $5M on production, paid in stock or cash or a mix, or staged, $1M over 3 years, and add in an NSR of 2% or 3%. (Net Smelter Royalty)
  

• Raise seed capital. Usually once you have the assets tied up with an LOI or definitive agreement, you can then go raise some capital. This might mean $500K to $2M in a private placement, or through a shell vend in that has some cash, but, it’s usually raised through a network of brokers and retail investors who know the game.
  

• Vend into a shell. Instead of starting a new public company from scratch, many juniors reverse into a dormant TSX-V/CSE shell via an RTO (reverse take over), saving time and money. The asset is vended in, and the stock starts trading a few months later once all the regulatory documents and small financing are approved/completed.
  

• Raise more money post-listing. A $5–10M IPO or follow-on placement typically funds the first major drill program.

This is the pre-drill stage.

It’s risky.

It’s promotional.

And it’s where serious wealth is starting to be made.

The early investors love to get into these $0.05 and $0.10 seed rounds, or friends & family rounds as they’re called.

2. How Deposits Are Found

Mining doesn’t start with mining…

It starts with looking, and a lot of educated guesswork!

Geologists use a combination of tools:

• Rock sampling. Chip samples from surface to test for mineral content.

• Soil sampling. Fine-tuned chemical analysis that shows metal concentrations beneath the surface.

• Airborne geophysics. Helicopters fly EM (electromagnetic) or mag (magnetics) surveys to find buried anomalies.

• Ground geophysics. IP (Induced Polarization) surveys detect chargeable zones, often linked to sulphides (gold, copper, silver).

This data gets layered together into a geological model, a 3D best guess of what lies below. That model tells them where to drill.

Like VRIFY’s new tech:

Our AI-Assisted Mineral Discovery Platform — the only one in the world — transforms vast datasets into actionable insights using proprietary AI and deep-learning models to help you find what’s yours.

And then…

3. Drilling: The Turning Point

Drilling is where the game changes.

Here’s what it takes.

A. Drill Permits & Prep

Before anything moves, the company needs exploration permits and in many jurisdictions, that means consulting with First Nations or local stakeholders. It can take weeks or months or years… it all depends.

Once approved:

• Mobilization begins. A drill rig, diesel, core boxes, and crew get flown/trucked in.

• Access roads may be cut. Especially in remote areas, you need a path for the rig.

• Water and fuel stations are established. Remote drilling requires infrastructure — tanks, pumps, satellite comms.

B. Drilling Begins

Two primary methods:

• RC (Reverse Circulation): Blasts chips up to surface with air. Fast and low-cost. Used in early-stage scout drilling.

• Diamond Core Drilling: Uses a diamond-tipped bit to extract solid core. Slower and more expensive, but essential for accurate geological modeling.

A typical rig can drill 50–150 meters per day, depending on rock hardness. Each hole takes days to complete.

Depths range from 100m to over 1,500m depending on target.

C. Core Logging & Sampling

Once pulled, core is laid in trays and flown to a central camp.

• Logged: Geologists assess lithology, alteration, structure, and mineralization.

• Photographed and tagged for database input.

• Split: Half the core is sawed off and bagged for assay.

• Shipped to lab: often internationally, unless a local ISO-certified lab is available.

D. Assay Results

Assays measure metal content — and turnaround can range from 2 weeks to 3 months.

Investors live and die by these releases. Results are typically:

• g/t (grams per tonne): For gold/silver.

• % (percentage): For copper, zinc, nickel.

For example:

• 12m @ 2.3 g/t Au = strong gold hit.

• 80m @ 0.45% Cu = potentially economic porphyry intercept.

E. Data Interpretation

Each result feeds back into the geological model. Holes are spaced to determine:

• Extent of mineralization

• Continuity across strike and depth

• Zoning of high-grade cores vs. waste zones

It’s not just about big numbers, it’s about consistent mineralization and economic mining widths.

F. Resource Definition & 43-101

With enough holes, a compliant resource estimate can be published:

• Inferred: Lowest confidence, widest spacing.

• Indicated: Moderate certainty, useful for PEA.

• Measured: High certainty, required for Feasibility.

Each level boosts the market cap, derisks the project, and brings new investors into the story.

Next?

Economic studies, permits, and the long road to production.

4. Permitting: Where Dreams Go to Die

You could have the greatest copper discovery since Escondida, but if you can’t get a permit, it’s worth $0.00.

Permitting is the slow, bureaucratic slog that separates exploration from production.

Let’s compare:

• Nevada, USA: 7 years to permit. Stable, but slow.

• Western Australia: 4 years. Fast, mining-friendly, but ESG-sensitive.

• DRC, Africa: 2–3 years. Quick… but you might lose your mine to politics later.

• Chile: 2-3 years.

It’s not just paperwork. You’re dealing with:

• Environmental baseline studies

• Indigenous consultations

• Local employment mandates

• NGOs, water boards, and ministers

Smart miners de-risk this by acquiring existing permitted projects or operating in tier-one jurisdictions.

Investors should take notes, even high-grade deposits can be uninvestable if the permitting risk is high.

You could have the highest grade deposit on the moon but… ya, you get the point.

5. Building the Sucker: From Surface to Pit

Let’s say your junior miner clears the hurdles.

What now?

Time to build a mine!

This is where real capital comes in, usually hundreds of millions, often billions.

And no matter what they tell you, it’s almost always more expensive than the feasibility study said.

CapEx includes:

• Roads, power, water, and housing

• Processing plant (grinding, flotation, leaching, smelting)

• Mine fleet: drills, shovels, crushers, and 400-ton haul trucks

• Environmental controls (tailings, water treatment)

• Working capital

Want a ballpark?

• A 5,000 tpd underground gold mine = ~$200M+

• A 100,000 tpd open-pit copper operation = $2–5B+

This is why most juniors either sell to majors (like Newmont, Barrick, BHP ($NEM ( ▼ 0.44% )  $GOLD ( ▼ 1.15% )  $BBL ( ▼ 2.42% ) ), or bring them in as JV partners.

It’s also why many deals get structured as royalty plays or streaming agreements, to offload capex in exchange for a cut of future production.

6. Production Styles: Open Pit vs. Underground

Not all mines are created equal. The method depends on depth, geometry, and rock hardness.

Open Pit:

• Used for copper, iron ore, bulk tonnage gold

• Massive fleets of drills, shovels, and 300–400 tonne haul trucks

• Easy access, lower cost per tonne — but high strip ratios can kill margins

Underground:

• Used for gold, silver, nickel, lithium

• Declines or shafts to access orebody

• Lower throughput, but higher grades

• More expensive per tonne, but less environmental impact

As an investor, you need to know:

• Throughput: How many tonnes/day?

• Head grade: What’s the grade going in?

• Recovery: What % do they actually get out?

7. Processing: Turning Rock into Revenue

Gold:

• Ore is crushed and ground

• Gold is leached using cyanide (CIL or CIP process)

• Metal is absorbed onto activated carbon

• Smelted into gold bars

Copper:

• Ground ore is floated with chemicals in a froth flotation circuit

• Produces concentrate (25–30% Cu)

• Shipped to smelters → blister copper → cathodes

Lithium:

• Hard rock (spodumene) or brines

• Processed into lithium carbonate or hydroxide

• Sent to cathode/battery manufacturers

All these processes add costs, which gets wrapped into the AISC.

8. The Logistics Game: How Metal Moves

Mine to Port:

• Private rail, long-haul trucks, or even airlifted doré bars

Ocean Freight:

• Bulk carriers (iron ore)

• Containers (copper, refined nickel)

• Secure air (gold)

Infrastructure matters. No road = no mine. And building logistics eats CapEx fast.

9. Who Buys This Stuff?

Gold:

• Refiners → bullion banks → ETFs, central banks, jewelers

Copper:

• Smelters → fabricators → power grids, EVs, infrastructure

Iron Ore:

• Steel mills (mostly China)

Lithium/Nickel/Cobalt:

• Battery manufacturers → Tesla, BYD, CATL

9. What Does It Cost to Mine a Metal?

Know this: AISC (All In Sustaining Cost)

• Mining + processing + G&A + sustaining capex + environmental fees + royalties

Typical AISC Ranges:

• Gold: $1,250–$1,500/oz (low-cost mines < $1,000)

• Copper: $2.75–$3.25/lb

• Iron Ore: $15–$40/tonne

• Lithium: Brine cheaper than hard rock

Margins matter more than scale.

A small, low-cost mine can outperform a giant, bloated one.

10. The Jurisdiction Gauntlet

Tier-One:

• Canada, USA, Australia

• Pros: Stability.

• Cons: Slow permitting, ESG.

Mid-Risk:

• Chile, Peru, Mexico

• Great deposits, but politics swing hard.

High-Risk:

• DRC, Guinea, Argentina

• Giant upside. Giant political risk.

Sweet spot: low-cost mines in proven mid-risk countries.

11. Results: Real Companies, Real Production

Thanks to my friends @miningvisuals

12. Investor Playbook: How to Actually Pick a Winner

What to Look For: 

✅ Low AISC relative to metal price

✅ Long mine life (10+ years)

✅ Tier-one/two jurisdictions , or strong partner(s)

✅ Exploration upside

✅ Clean balance sheet

✅ Management that’s done it before

✅ Creative financing techniques (royalties, forward gold/metal sales)

What to Avoid: 

🚫 One mine stories with short reserves

🚫 High-cost producers needing +$2,500 gold to survive

🚫 Permitting nightmares

🚫 Too much dilution @ low prices

🚫 Optionality plays with no development plan

Red flag: If the deck shows 17 slides of beautiful pictures, run.

13. Final Word: Mining is Hard, That’s Why It Pays

We’ve (I’ve) waited 14 years for this mining cycle to finally break out as we’re seeing on the GDXJ:

It is cyclical, capital intensive, politically exposed, and operationally brutal.

BUT, that’s also why it pays.

And when you’re getting upwards of 50% free cash flow with $3,500 per oz gold?

That is truly unbelievable.

The retail crowd chases headlines.

The real winners?

They know the rocks, the risks, and the returns, and they follow margin/FCF.

Then they build positions in silence.

Then, they cash in when gold hits $5,000 an oz, and while everyone else waits for the next hot drill result.

There’s gold in these hills, if you know how to look!

I hope you’ve enjoyed my extremely long mining guide.

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As always, do your own due diligence, and… Happy Hunting!

About The Net Worth Club

Welcome to The Net Worth Club — a no-fluff, high-conviction investing newsletter written for people who want to grow their wealth intelligently and aggressively.

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