Same time thirteen years ago some of Bre-X`s test results for gold landed on my desk. I had not asked for Bre-X’s data. But I had agreed to and signed a three-year confidentiality agreement with Barrick Gold Corporation. I did so on December 16, 1996. It was the very same confidentiality agreement Barrick Gold Corporation and Bre-X Minerals had signed a few days earlier. The first set of Bre-X data were transmitted by facsimile on December 17, 1996. I didn’t know then that my life would never be the same. Bre-X’s infamous phantom gold resource is but part of a tangled tale with as many twists and turns as Matheron took to create his new science of geostatistics. It’s a tale that taught me a lot more about the mining industry than I cared to know.
I sorted out the Bre-X fraud faster than Bre-X’s salting squad took to cook it up. I thought Barrick liked what I did. At least Barrick did when I applied statistics to prove that Bre-X was a salting scam.Barrick liked it so much that I signed on July 4, 1997 a Consulting Services Agreement with Barrick Goldstrike Mines Inc. I submitted on August 18, 1997 my report on Statistical Quality and Grade Control . Geostatisticians on Barrick’s staff didn’t think much of it. I had applied Fisher’s F-test to verify spatial dependence between gold grades of ordered core sections from a single borehole by applying it to the variance of the set and the first variance term of the ordered set. I had done the same thing with Bre-X’s salted boreholes. Stanford’s Journel would have assumed spatial dependence. But then, Matheron’s most gifted disciple never signed a Consulting Services Agreement with Barrick Goldstrike Mines Inc.When I was working with Bre-X’s test results my closest contact was a staff mining engineer at Barrick Gold Corporation in Toronto. We got along great because he knew plenty about sampling and assaying. And he knew why Bre-X’s bogus grades and Busang’s barren rock added up to a geostatistically engineered gold resource. He also knew how to test for spatial dependence, and why geostatistics should not be applied in reserve and resource estimation. He asked me whether I wanted to take a look at a large set of borehole data for a real gold deposit. Guess what? So, I did agree to and signed on October 22, 1997 a confidentiality agreement with Barrick Gold Corporation. I submitted my report on Confidence Limits for Gold Contents and Grades on February 9, 1998. When I called my contact to find out what he thought of my report he said, “It’s worth its weight in gold.” I didn’t ask him to put it in writing. His word was good enough for me.