After preliminary exploration has been completed, the next step in the life cycle of a gold mine is resource definition. The processes in reserve definition are similar to preliminary exploration, and there is considerable overlap between the two phases. However, in resource definition, the exploration company has reason to believe that their property contains a mineral reserve. Therefore, the company will spend more money on intensive and technical exploration techniques. The resource definition phase not only involves further analysis of the size and grade of the mineral reserve, but also uses engineering and geotechnical studies to evaluate the mining method and the estimate how much it will cost to extract the ore, given the geology of the deposit. At the end of this process, a feasibility study is published, and the ore deposit may be either deemed uneconomic or economic within stipulated market variations.
While the feasibility study is the key development in the advanced exploration phase, in regional exploration, companies actually collect a great deal of data that is used in the feasibility study. A feasibility study analyzes the sampling, test work, and engineering analysis conducted throughout the exploration phase to determine whether or not a project has the proper economics to be developed into a mine. During the feasibility study how and what a public company communicates (regarding reserve estimates etc.) is governed by the securities exchange commission in the country where the company is listed. The rules are meant to prevent a company from releasing misleading information to the public. In Canada, the National Instrument 43-101 Standards of Disclosure for Mineral Projects dictates the rules.
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