How to Read an NI 43-101 Report Like a Professional Mining Analyst

If you buy mining stocks without reading 43-101 reports, you are gambling. Full stop. The technical report is the single most important disclosure document in the junior mining world — it is where geology meets engineering meets economics, and it is the document that separates projects worth billions from projects worth nothing. Yet most retail investors either ignore these reports completely or skim the first page, read the NPV headline, and move on.

That is a catastrophic mistake. Professional analysts, portfolio managers, and mining engineers spend days (sometimes weeks) dissecting a single technical report before committing capital. They know where the truth is hidden, which sections companies use to bury bad news, and which numbers are worth trusting versus which are marketing fluff dressed up in technical language.

This guide will teach you to read an NI 43-101 the way a professional does. By the end, you should be able to open any technical report and, within two to three hours, form an independent view on whether the project is economic, whether the numbers are credible, and whether the stock is worth owning.

Part 1: What NI 43-101 Actually Is — And Why It Exists

NI 43-101 stands for National Instrument 43-101 — Standards of Disclosure for Mineral Projects. It is a Canadian securities rule administered by the Canadian Securities Administrators (CSA) that governs how publicly listed mining companies (on the TSX, TSX-V, CSE) must disclose technical information about their mineral projects.

The rule was born out of the Bre-X scandal in 1997. Bre-X Minerals was a Calgary-based company that claimed to have discovered the world's largest gold deposit at Busang in Indonesia. The company's market cap briefly exceeded $6 billion before investigators discovered that the drill core samples had been salted — literally sprinkled with gold from a jeweller's file. The stock went to zero, pensioners lost their savings, and a lead geologist fell (or was pushed) from a helicopter over the Indonesian jungle.

NI 43-101 was implemented in 2001 as a direct response. It mandates three things:

1. Technical information must be prepared by or under the supervision of a Qualified Person (QP) — an accredited geologist or engineer with at least five years of relevant experience.
2. All material technical information disclosed in news releases, websites, or investor presentations must be supported by a publicly filed technical report.
3. Resources and reserves must be reported using CIM Definition Standards — a standardized classification system that makes projects comparable.

The key insight: 43-101 is a disclosure standard, not a quality standard. A project can have a compliant 43-101 report and still be a terrible investment. The report tells you what the QP believes is true — it does not tell you whether the project will make money. Your job as an investor is to read the document skeptically.

Part 2: The Qualified Person — Who Wrote This Thing?

Before you read a single word of the technical content, flip to the signature page and the QP disclosures. Professional analysts do this first. Always.

You are looking for:

• Who is the QP? Are they an employee of the company (an "internal QP") or an independent consultant? Internal QPs are allowed for certain filings but independent QPs carry more weight, especially for PEAs, PFSs, and FSs.
• What firm do they work for? Tier-one engineering firms — SRK Consulting, AMC, Wood, WSP (formerly Golder), Ausenco, Hatch, BBA, DRA, Lycopodium, Roscoe Postle (now SLR Consulting), Mining Plus, Behre Dolbear — have reputations to protect. A report from SRK is not automatically correct, but it carries more credibility than a report from a one-person shop no one has heard of.
• What's the QP's specialty? A 43-101 is a team document. You want a geologist signing off on resources, a mining engineer signing off on the mine plan, a metallurgist signing off on recovery, and so on. Be suspicious when a single QP signs off on everything — especially for a complex project.
• History. Google the QP's name. Have they been involved in previous projects that went sideways? Have they been sanctioned by their professional association?

Pro tip. A useful rule — if the QP list includes SRK, AMC, SLR, or Wood for the resource estimate, take the numbers seriously. If the resource was estimated in-house by a company geologist with no independent review, add a significant discount until the project is advanced further.

Part 3: The 27-Section Anatomy of a 43-101

Every technical report follows the same skeleton. Understanding this structure is the first big unlock — once you know where information lives, you can navigate a 300-page report in minutes.

The 27 sections, in order:

1. Summary
2. Introduction
3. Reliance on Other Experts
4. Property Description and Location
5. Accessibility, Climate, Local Resources, Infrastructure, Physiography
6. History
7. Geological Setting and Mineralization
8. Deposit Types
9. Exploration
10. Drilling
11. Sample Preparation, Analyses, and Security
12. Data Verification
13. Mineral Processing and Metallurgical Testing
14. Mineral Resource Estimates
15. Mineral Reserve Estimates
16. Mining Methods
17. Recovery Methods
18. Project Infrastructure
19. Market Studies and Contracts
20. Environmental Studies, Permitting, Social or Community Impact
21. Capital and Operating Costs
22. Economic Analysis
23. Adjacent Properties
24. Other Relevant Data and Information
25. Interpretation and Conclusions
26. Recommendations
27. References

For a resource-stage project (no economic study yet), sections 15–22 are typically absent or placeholders. For a Preliminary Economic Assessment (PEA), Pre-Feasibility Study (PFS), or Feasibility Study (FS), all 27 sections are required and filled out.

Now let's go through the sections that matter most, in the order a professional analyst reads them.

Part 4: The Analyst's Reading Order — Don't Start at Page One

Here is a counterintuitive truth: professionals almost never read a 43-101 cover to cover in page order. They jump around, because they know where the signal is and where the noise is. Here is the typical reading order I use and most analysts I know use something similar:

1. Section 1 (Summary) — to get the pitch.
2. Section 25 (Interpretation & Conclusions) — to see what the QP themselves flag as risks.
3. Section 14 (Resource Estimate) — to stress-test the orebody.
4. Section 22 (Economic Analysis) — to see if the money math works.
5. Section 21 (Capex/Opex) — to test whether the economics are credible.
6. Section 13 + 17 (Metallurgy & Recovery) — to see if the metal actually comes out.
7. Section 16 (Mining Methods) — to test the mine plan assumptions.
8. Sections 11–12 (QA/QC and Data Verification) — to trust the data.
9. Section 20 (Environmental & Permitting) — to find fatal flaws.
10. Sections 4–6 (Property, Access, History) — for political and logistical context.

Let's dig into each of these.

Part 5: Section 1 — The Summary (Read Skeptically)

The Summary is the company's best foot forward. It is what goes into investor presentations and press releases. Treat it like a movie trailer — useful, but not the movie.

What you want from the Summary on a first pass:

• Commodity and deposit type (gold, copper-gold porphyry, VMS, SEDEX lead-zinc, lithium brine, nickel sulfide, uranium, etc.).
• Location (country, province, distance from infrastructure).
• Stage (exploration, resource, PEA, PFS, FS, construction, production).
• Resource size and grade.
• Economic headlines (NPV, IRR, initial capex, payback, mine life).
• Commodity price assumptions.

Write these down in a notebook or spreadsheet before reading further. You will revisit them and often find they disagree with the detail elsewhere in the report.

A warning: the Summary will always quote the most favourable case. If there's a base case and an upside case, the Summary features the upside case. If the mine plan includes both open-pit and underground phases, the Summary averages them to hide a high-cost underground tail. Read with this in mind.

Part 6: Section 14 — The Mineral Resource Estimate

This is the heart of the report. The resource estimate answers the question: how much metal is in the ground, and how confident are we in that number?

Resource Classification: Inferred, Indicated, Measured

CIM defines three resource categories based on geological confidence:

• Inferred — the lowest confidence. Based on limited drilling; quantity and grade are estimated with "low level of confidence." You cannot base a mine plan or an economic study (other than a PEA) on inferred ounces. Many juniors' resources are 70%+ inferred — that is a flashing yellow light.
• Indicated — moderate confidence. Drilling is dense enough that continuity of grade is reasonably assumed. This is the minimum category that supports a PFS or FS reserve conversion.
• Measured — highest confidence. Tight drill spacing, typically at spacing that allows grade variability to be well understood. Rare in early-stage projects.

What to Look For

When you get to Section 14, extract:

1. Tonnes, grade, and contained metal for each category, reported separately. Never accept "total resource" that combines measured, indicated, and inferred into one number — that is a presentation trick.
2. Cut-off grade. The cut-off is the minimum grade at which rock is considered ore. It is the single biggest lever in the entire report. A gold deposit reported at 0.3 g/t cut-off will look enormous; the same deposit at 0.5 g/t cut-off may be half the size. Professionals always ask: "is the cut-off grade realistic at the assumed mining method and commodity price?"
3. Commodity price assumption for the cut-off calculation. If gold is spot-priced at $2,300/oz and the resource is calculated using $1,950/oz, the reported resource is conservative — good. If it is calculated at $2,600/oz, the resource is aggressive — be wary.
4. Drill spacing and interpolation method. Ordinary kriging, inverse distance weighting (IDW2 or IDW3), and nearest neighbour are the common methods. You do not need to be a geostatistician, but you do want to check that the QP discusses search ellipses, variography, and block size.
5. Sensitivity tables. Good reports show resource tonnage and grade at multiple cut-off grades. This lets you see how fragile the number is.

Red Flags in Section 14

• High inferred percentage (>50% of total resource) in a PEA or PFS.
• Cut-off grade far below the industry norm for the deposit type.
• Very wide drill spacing being used to support an Indicated classification.
• No independent review of the resource estimate.
• A large jump in resource tonnage between consecutive reports with minimal new drilling (suggests methodology change, not real growth).

Part 7: Section 15 — Mineral Reserves (PFS and FS Only)

A reserve is the subset of a resource that has been demonstrated to be economically mineable after applying "modifying factors" — metallurgy, mining method, processing, dilution, mining recovery, capital and operating costs, metal prices, royalties, permitting, environmental, legal, political, marketing.

• Probable Reserve ← converted from Indicated Resource.
• Proven Reserve ← converted from Measured Resource.
• Inferred Resource cannot be converted to reserve. Ever. This is a regulatory bright line.

When reading Section 15, extract:

• The conversion ratio — what percentage of the Indicated Resource became Probable Reserve? A 75–90% conversion is typical and healthy. If it's 100%, be suspicious. If it's below 50%, the deposit has continuity or grade problems.
• The dilution and mining recovery assumptions. Open-pit dilution is typically 3–10%; underground dilution can be 10–25% or higher depending on mining method. Mining recovery is often 90–95% open-pit, 85–95% underground.
• The reserve grade versus resource grade. Reserve grade is almost always lower than resource grade because of dilution. If reserve grade exceeds resource grade, something is wrong (or a higher cut-off was used to high-grade the mine plan).

Part 8: Sections 13 and 17 — Metallurgy and Recovery (Where Projects Die Quietly)

This is where many retail investors check out. Do not. Metallurgy is where a surprising number of projects fail.

Recovery is the percentage of metal in the ore that ends up in the final concentrate or doré bar. If your gold deposit has 90% recovery, a tonne of rock grading 1 g/t produces 0.9 g/t of saleable gold. If recovery drops to 70% because of refractory mineralogy, the same deposit is worth 22% less — and often uneconomic.

What to look for:

1. Metallurgical test work stage. Bottle roll tests and bench-scale leach tests are early-stage. Locked-cycle flotation tests and pilot plant tests are late-stage and far more credible.
2. Sample representativeness. Did metallurgical samples come from across the deposit, or just from the high-grade core? Small, non-representative samples produce flattering recoveries that won't hold up in production.
3. Deleterious elements. Arsenic (in gold), uranium (in copper concentrates), fluorine, mercury, bismuth — these attract smelter penalties or outright rejection. A good report discusses them openly.
4. Refractory ore. If the word "refractory" appears, read carefully. Refractory gold ore requires pressure oxidation, roasting, or bio-leach — all expensive. Refractory ore in a PEA with a simple CIL flowsheet is a red flag.
5. Concentrate grade and smelter terms. For base metals, the concentrate grade (e.g., 25% copper, 55% zinc) determines smelter treatment and refining charges, which dramatically affect realized prices.

Part 9: Section 16 — Mining Methods

This section describes how the ore will be extracted. The two broad categories are:

• Open pit — cheaper per tonne, higher dilution, lower grade tolerated. Think large porphyry coppers, most heap-leach golds.
• Underground — higher cost per tonne, more selective, higher grade required. Sub-level caving, long-hole stoping, cut-and-fill, block caving are the main methods.

Key things to check:

• Strip ratio (for open pits): tonnes of waste moved per tonne of ore. A 2:1 strip ratio is lean; 8:1 is heavy; above 12:1 starts to compromise economics.
• Mining rate (tonnes per day or per year). Is it plausible given the deposit geometry and the planned fleet?
• Mining cost per tonne. Open-pit mining in Canada or Australia typically runs $2.50–$5.00/t of material moved; underground can be $40–$120/t depending on method and depth.
• Pit slope angles. Overly aggressive slopes (steeper than 50°) without geotechnical backing can fail catastrophically. Failures cost lives and years.
• Ramp-up schedule. How long from first ore to steady-state production? Twelve to 24 months is normal; anything faster is optimistic.

Part 10: Sections 21 and 22 — Capex, Opex, and the Economic Model

This is where all the geology and engineering resolves into a number that either attracts capital or doesn't.

Capital Costs (Section 21)

Initial capex is the money needed to build the mine and get it to commercial production. Sustaining capex is the ongoing capital needed to keep it running (fleet replacement, tailings expansions, pit pushbacks).

When reading capex, watch for:

• Accuracy level. PEA-level capex is ±30–50%. PFS-level is ±25%. FS-level is ±15%. Treat a PEA capex estimate as a very rough number — history shows final construction capex typically comes in 20–50% above the PEA estimate, often more for complex projects in difficult jurisdictions.
• Contingency percentage. PEAs often use 15–20% contingency. FS should use 10–15% on engineered costs. If contingency is under 10%, the engineer is being aggressive.
• Owner's costs. Often 5–10% of capex. If missing or suspiciously low, add 8% yourself.
• EPCM or EPC assumption. Engineering/Procurement/Construction Management is the common contract structure; it exposes the owner to cost overruns.
• Exclusions. Read the fine print — working capital, closure bonding, import duties, and pre-production operating costs are sometimes excluded.

Operating Costs (Section 21)

Operating cost is usually reported in three ways:

1. $/tonne milled — useful for comparing processing efficiency.
2. $/tonne of ore or ore+waste moved — useful for mining efficiency.
3. $/oz (or $/lb) of payable metal — the headline number; includes mining, processing, G&A, and refining.

For gold, pay close attention to two metrics:

• Cash cost per ounce — a legacy measure, now largely replaced.
• All-In Sustaining Cost (AISC) per ounce — includes cash costs + sustaining capex + reclamation + corporate G&A allocated to the mine. AISC is the number that matters. A gold mine with AISC below $1,200/oz is healthy at today's prices. Above $1,600/oz and margins are thin.

Economic Analysis (Section 22)

This section is the DCF model summary. Key outputs:

• NPV (Net Present Value). Usually reported at 5%, 8%, and 10% discount rates. Professionals focus on NPV at 8% after-tax as the reference figure for most mining projects (higher discount rates for jurisdictional risk, lower for Tier 1 jurisdictions).
• IRR (Internal Rate of Return). For a PFS or FS, an after-tax IRR below 15% is borderline; 20–30% is attractive; above 40% you should ask why it's so high and what commodity price assumption is driving it.
• Payback period. How long to recover the initial capex? Four years or less is strong; over six years is risky.
• Mine life. Long-life assets (15+ years) trade at premium multiples. Short-life (5–7 years) trade at discounts unless exploration upside is clear.
• LOM (Life-of-Mine) production profile. Look for smooth, level production versus a front-loaded curve that drops off a cliff.

The Commodity Price Assumption — The Single Most Important Number

Every economic model uses a set of long-term commodity prices. This single assumption can make or break the project. A gold project modeled at $2,400/oz looks spectacular; the same project at $1,800/oz may have negative NPV.

Professionals do three things:

1. Recalculate the economics at spot prices and at consensus long-term prices (typically published by major banks).
2. Run sensitivity. Every 43-101 economic section should include an NPV sensitivity table showing NPV at ±10%, ±20% commodity prices, capex, and opex. If that table is missing, demand it before buying the stock.
3. Compare the assumption to current spot. If the report uses prices well above current spot (e.g., $2,700/oz gold when spot is $2,300), treat the NPV headline as marketing.

Part 11: Sections 11 and 12 — QA/QC and Data Verification (Boring but Critical)

After Bre-X, regulators became obsessive about sample integrity. Sections 11 and 12 describe how samples were collected, handled, transported, assayed, and verified.

What you are looking for:

• Chain of custody. Were samples sealed at the drill rig? Transported by company staff or independent couriers? Stored securely?
• Insertion of standards, blanks, and duplicates at regular intervals (typically 1-in-20 standards, 1-in-20 blanks, 1-in-20 duplicates). This is the QA/QC program. If the report does not describe the program in detail, it is a red flag.
• Lab used. Tier-one labs include SGS, ALS, Bureau Veritas, Intertek, Actlabs. Lesser-known labs can be credible too, but check.
• QP site visit. The QP must physically visit the site. The report will state the date and duration. A multi-day site visit with core review is meaningful; a half-day fly-in is concerning for a material project.
• Twin drill holes. These are holes drilled next to original holes to verify results. Their presence signals a serious program.

This section is where salting, fraud, and sloppy work are (or are not) caught. It is unglamorous reading, but it is where the foundation of every other number in the report lives. A billion-dollar NPV built on contaminated assay data is worth zero.

Part 12: Section 20 — Environment, Permitting, and Social Licence

Increasingly, this is where projects die — not in the geology, but in the permitting and community.

Check for:

• Stage of environmental baseline studies. Early-stage projects may have minimal baseline; PFS and FS require multiple seasons of hydrology, water quality, flora/fauna, and air studies.
• Tailings management approach. Conventional tailings, dry-stack, paste backfill, in-pit deposition — each has cost and risk implications. After Brumadinho (2019) and Mount Polley (2014), tailings dam risk is a first-order concern for every institutional investor.
• Permitting timeline. How many permits are required, at what levels (federal, state/provincial, municipal), and what is the realistic timeline? In Canada, a federal impact assessment can take 3–5 years; in Peru, social licence negotiations can take a decade.
• Indigenous and community agreements. Are there signed Impact Benefit Agreements (IBAs) or community development agreements? The absence of a signed agreement is a major risk even if permitting is progressing.
• Closure and reclamation cost. Is it adequately estimated and bonded?

Part 13: PEA vs PFS vs FS — Knowing Where You Are on the Curve

Understanding the economic study stage is essential because each stage has different rules, different accuracy, and different investor implications.

A PEA is a marketing document with a technical wrapper. It is designed to tell a story. The project has not been engineered in any meaningful sense. PEA NPVs are almost always the highest NPV the project will ever report because they include inferred ounces, use optimistic assumptions, and have not yet encountered engineering reality.

A PFS (Pre-Feasibility Study) removes inferred ounces, applies real engineering to the mine plan, and uses bench-scale-plus metallurgy. PFS NPVs typically come in below the PEA NPV — sometimes dramatically so. This is where optimism meets gravity.

An FS (Feasibility Study, sometimes "DFS" for Definitive) is bankable. Engineering is 40–70%+ complete, contracts are in draft form, the tailings design is final, permits are in hand or close, and metallurgy is validated at pilot scale. If banks will lend against it, it's an FS.

The "PEA → PFS → FS fade" is real and well-documented. Academic studies by professional bodies have shown that on average, FS NPVs come in 15–30% below PEA NPVs for the same project, and actual operating economics after construction come in another 10–20% below FS. Model this into your investment thinking.

Part 14: The Analyst's Toolkit — What Professionals Calculate Themselves

After reading the report, a professional analyst will produce their own numbers rather than trust the company's. Here is what they typically compute:

1. Independent NAV. Build a simple DCF using the company's production profile but the analyst's own commodity price, discount rate, and tax assumptions. Compare to the market cap.
2. P/NAV. Market cap divided by NAV. Developers trade at 0.3–0.7x P/NAV typically; producers 0.7–1.5x. Below 0.3x signals either a bargain or a market-perceived flaw.
3. EV per resource ounce. Enterprise value divided by contained ounces (often separated by category — EV per Measured+Indicated ounce is the most common comparable). Useful for cross-project comparables but limited by grade, jurisdiction, and stage differences.
4. Capex intensity. Initial capex per annual ounce of production. Low-capex-intensity projects (say, under $3,500/oz annual capacity for gold) are more likely to get built.
5. AISC margin. Commodity price minus AISC, times production — the cash profit engine of the mine.
6. Jurisdictional overlay. Apply a country risk discount. Tier 1 (Canada, Australia, USA, Finland) = 0%. Tier 2 (Mexico, Peru, Chile, Brazil) = 10–20%. Tier 3 (DRC, Russia, Venezuela, parts of West Africa) = 30%+.

Part 15: The Red Flag Checklist

After reading hundreds of 43-101s, patterns emerge. These are the signals that should either disqualify a project or at least send you hunting for answers:

• >50% inferred resources in a PEA or later-stage report.
• Commodity price assumption >10% above current spot without strong justification.
• Cut-off grade below industry norm to inflate resource tonnage.
• Single-lab assaying with no umpire lab check.
• Short QP site visit relative to project complexity.
• Internal QP only for a material project.
• Missing sensitivity tables for NPV.
• Refractory or complex metallurgy with bench-scale test work only.
• Strip ratio >10:1 not acknowledged as a cost risk.
• No signed community/IBA agreement in a jurisdiction where one is required.
• Large unexplained resource growth between consecutive technical reports.
• Contingency below 10%.
• Owner's costs missing or suspiciously low.
• Mine life <7 years with no meaningful exploration upside.
• Tailings plan unclear or controversial.
• No independent review of the resource or economic model.

Any one of these is not fatal. Three or more in the same report should make you put the stock on your "no" pile until the next technical report addresses them.

Part 16: Practical Workflow — How to Read Your First Report

If you have never read a 43-101 cover-to-cover, here is a five-hour workflow that will get you 80% of the professional signal:

Hour 1 — Context. Read Section 1 (Summary) and Section 25 (Interpretation & Conclusions). Write down the pitch and the risks in your own words.

Hour 2 — The orebody. Read Section 14 (Resources) in detail. Build a spreadsheet with tonnes, grade, contained metal by category, and cut-off sensitivity if provided.

Hour 3 — The economics. Read Sections 21 and 22. Pull out capex, opex, AISC, NPV, IRR, payback, mine life, and every commodity price assumption. Compare commodity prices to current spot.

Hour 4 — The physical project. Read Sections 13, 16, and 17 (metallurgy, mining, processing). Understand the flowsheet. Identify any refractory, high-dilution, or high-strip-ratio risk.

Hour 5 — The risk layer. Read Section 20 (environment/permitting), Sections 11–12 (QA/QC), and revisit Section 4 (property) for political context. Run the red-flag checklist.

Then, and only then, read Sections 1 and 25 one more time. You will read them completely differently the second time. That is the moment you have learned to read a 43-101.

Part 17: Where to Find 43-101 Reports

Every filed technical report is public. Here is where to look:

• SEDAR+ (sedarplus.ca) — the Canadian securities regulator's filing system. Filter by company, then "Technical Report" document type. Free.
• Company websites — most post the latest technical report under Investors → Technical Reports.
• SEC EDGAR (sec.gov) — for dually-listed companies that file with the SEC as well (they'll file SK-1300 reports there, which are similar).

A pro tip: compare the current technical report to the previous technical report (if one exists). Changes in cut-off grade, mining method, resource estimation methodology, or commodity price assumption between reports tell you a lot about what the company is hiding or pivoting from.

Part 18: The Final Mental Model

After reading thousands of technical reports across a career, experienced mining investors carry a simple mental model:

A 43-101 is a story about converting rocks into cash. Your job is to check every step of the conversion chain: are the rocks really there (resource), can we get them out (mining), can we extract the metal (metallurgy), can we sell it for more than it cost (economics), and can we actually build this thing in this jurisdiction (permitting and capex)?

Every section of the report maps to one link in that chain. A project is only as strong as its weakest link. Most failed mining projects failed at one specific link — tailings permitting at Pebble, refractory metallurgy at countless gold juniors, community opposition at Conga, cost overruns at virtually every megaproject built in the last 20 years, grade shortfall at dozens of producers post-startup.

If you learn to read a 43-101, you can find the weakest link before the market does. That is the analyst's edge.

Closing Note

Learning to read 43-101 reports properly takes time — expect the first three or four reports to feel overwhelming. By the fifth or sixth, patterns emerge. By the tenth, you will be faster than 95% of retail investors and competitive with many junior analysts at sell-side shops.

The payoff is enormous. Mining is one of the few asset classes where the amateur and the professional are reading the same document, and where genuine disclosure rules mean the truth is usually in the report — just buried in Section 14 or hidden in the footnotes of Section 22. The investors who do the work outperform the ones who read headlines. That has been true since Bre-X, and it will be true for as long as humans dig metal out of the ground.

Bookmark this guide. Download a real 43-101 this weekend. Walk through the five-hour workflow once. You will never look at a mining press release the same way again.