Karat Chat


Who is monitoring the billion dollar refining industry?

By Scott Girouard- Regional Refining Consultant

You go to the grocery store to buy a gallon of milk and, regardless of the dairy farm, you get a gallon of milk. If you buy a gallon of gasoline, you’ll get exactly one gallon of gasoline, regardless of the gas station. There are governmental agencies that monitor those industries, such as the department of weights and measures. So which agency monitors the billion dollar a year refining industry?

None.

A refiner could receive 40 T-ounces of 10 karat gold. Those 40 T-ounces could yield anywhere from 15.5 to 16.5 T-ounces of pure gold, and no one would ever question it. In today’s market, that’s over $1,200.00 that you’re potentially losing. Worse than that, there’s nothing to prevent it. There are no agencies that test and monitor the processes and procedures of refiners. There’s no ISO type certification you can look for. All you can do is educate yourself on the processes that are utilized and then trust that you’re getting the best results.

There are two prominent ways refiners determine how much precious metals are in your scrap gold; XRF X-Ray technology and a true fire assay. In the refining industry, XRF X-Ray is the most prevalent method used to test your scrap. This is accomplished by melting the scrap metals down, extracting core samples (sometimes one, sometiGold Bars mes up to three) and then using an XRF X-Ray machine to test the core samples. X-Ray technology works by accelerating the surface of any material so that the top layer or two of atoms release some electrons and then those electrons are collected. The machine then analyzes those electrons and reports back what was found. It is the fastest method for determining the individual metals and elements in a sample. The problem with X-Ray is that it sacrifices accuracy for speed. There are many variables that can affect the results of an X-Ray. The best results are going to be if you take a sample that has air cooled, then ground to a smooth finish and is larger than the opening of the X-Ray tube. Those criteria are never met, specifically having that size of a sample that has been ground down. It’s impractical in this industry and would result in material loss in the grinding process. Inside the industry, it is accepted that an X-Ray has a margin of error from 1% to 8%, based on sampling off of a wide and flat surface (see above) and the accuracy will decline if done on small, non flat surfaces (such as what happens in the scrapping of precious metals). The other method you will generally find is to do a true fire assay. This method is more proven, but less common. It is accomplished by melting the scrap material into a homogeneous bar. After letting the material cool, multiple core samples are drilled. Those samples are then put through a process called cupellation which is another melting process that physically separates the precious metals from the non-precious metals through the use of lead and fluxes. The precious metals are then weighed and chemically analyzed to determine the actual physical weights of the precious metals in the sample. A true fire assay is accurate to 1 part per 10,000 or 99.99% accurate.

They both have their place in the industry, but not in the way most people think. X-Ray technology is fast. You can have your results within an hour potentially. For people who need money quickly, at the cost of accuracy, it isn’t a bad option. This is with them having the knowledge that they are leaving material, and in turn money, on the table. If someone has the ability to wait the few days that a fire assay takes though, why would anyone give up some of their material and money?

So now the question beckons, “How do I know what method is being used?” This is where the real troubles come into play in the refining industry. Many companies that utilize X-Ray technology, also utilize words like “Assay” and “Fire Assay” in how they describe their process. I’ve had customers routinely say “here’s a copy of my assay results”, and it’s from a company that is known to only use X-Ray technology. These companies are intentionally misleading their customers, without actually outright lying. They can use terms such as assay because they are melting the material. All a customer knows is that they are getting an “assay” and getting paid quickly.

Protect yourself and your material/money. Look at how long your refiner takes and use your better judgment. If you’re getting paid within 24 hours…..some real questions should be raised of your refiner.

Precious Metals Refining Consultant

Scott Girouard

 

Scott Girouard has been in the metals industry for over 12 years,

he is a Regional Refining Consultant for Pease & Curren Refiners.