Metal equivalents explained: AuEq and CuEq, and how assumptions inflate grades

A metal equivalent grade, such as AuEq (gold equivalent) or CuEq (copper equivalent), converts several metals in a drill interval into a single grade of the main metal using assumed prices and metallurgical recoveries. It is a legitimate shortcut when the assumptions are realistic and disclosed, but the result can swing a lot depending on the prices and recoveries chosen, so the assumptions matter as much as the headline.

Why metal equivalents exist

Many deposits contain more than one valuable metal. A copper porphyry may carry gold and molybdenum; a VMS deposit may hold copper, zinc, lead, silver and gold (the deposit types are compared in what moves copper stocks). Listing five grades for every interval makes holes hard to compare, so companies combine them into one number expressed in terms of the main metal.

The formula

For a copper-gold interval reported as copper equivalent:

The fraction at the end is the conversion factor: how many percent of copper one gram per tonne of gold is "worth" after recovery. The same structure works in reverse for AuEq, and extends with extra terms for silver, zinc, molybdenum or anything else.

Unit check: 1% copper in one tonne of rock is 10kg of copper. At US$10,000 per tonne of copper, that is worth US$100. One gram of gold at US$3,110 per ounce (31.1035g) is worth about US$100. We use these round, illustrative prices below so the maths is easy to follow; they are not forecasts.

What the ASX and the JORC Code expect

Clause 50 of the JORC Code 2012 sets out conditions for reporting metal equivalents, and ASX has reinforced them in its published guidance, including a 2025 Compliance Update that named metal equivalents as a focus area. In summary, a report using metal equivalents is expected to include:

• The individual grades of every metal included in the calculation.
• The assumed commodity prices for each metal.
• The assumed metallurgical recoveries for each metal and the basis for them, such as test work or comparable deposits.
• A statement that, in the company's opinion, all the elements included have a reasonable potential to be recovered and sold.
• The calculation formula.

The JORC Code also recommends that the metal chosen for reporting on an equivalent basis be the one contributing most to the calculation.

No real process recovers 100% of every metal. Copper recovery to a concentrate is often in the 80s or low 90s percent, and gold or other by-products in a copper concentrate can recover far less. At early exploration stage there is often no metallurgical test work at all, which is why the guidance takes the view that equivalents may be misleading at that point.

Worked example: same rock, three answers

A hypothetical copper explorer reports a long porphyry intercept: 300m at 0.45% Cu and 0.30g/t Au. The rock does not change below. Only the assumptions do.

Scenario A: no recoveries stated (implied 100%)

Conversion factor = (100 × 1.00) ÷ (100 × 1.00) = 1.00

CuEq = 0.45 + 0.30 × 1.00 = 0.75% CuEq

Scenario B: realistic recoveries

Assume test work supports 85% copper recovery and 55% gold recovery to concentrate.

Conversion factor = (100 × 0.55) ÷ (100 × 0.85) = 0.647

CuEq = 0.45 + 0.30 × 0.647 = 0.64% CuEq

Scenario C: optimistic prices, no recoveries

The company uses gold at US$4,000/oz (about US$128.60/g) and copper at US$9,000/t (US$90 per 1%), with recoveries not stated.

Conversion factor = 128.60 ÷ 90 = 1.43

CuEq = 0.45 + 0.30 × 1.43 = 0.88% CuEq

The same 300m of rock reports anywhere from 0.64% to 0.88% CuEq, a spread of about 37%, purely from assumptions. In value terms, Scenario A implies US$75 of metal per tonne; Scenario B, the realistic case, implies about US$55 of recoverable metal per tonne at the same prices. That gap can be the difference between a viable project and a marginal one.

Other ways equivalents get inflated

• Including metals that may not be payable. Cobalt, rare earths, antimony or zinc can add to an equivalent grade, but whether a smelter pays for them depends on concentrate type and grade. A metal that cannot be sold adds nothing.
• Choosing the denominator metal. Expressing a mostly gold interval as CuEq, or vice versa, can make the headline grade look more impressive in the context of peers.
• Stale or cherry-picked prices. Using a recent price peak for the by-product metal and a lower price for the main metal lifts the equivalent.
• Equivalents in the headline, individual grades buried. If you have to search the appendix for the copper grade, note that.

What to check

1. Find the individual grades. Calculate the main metal on its own and compare with the equivalent.
2. Find the prices. Are they close to current or consensus prices, or optimistic? Compare with the copper price and gold price pages.
3. Find the recoveries and their basis. "Based on test work" is stronger than "assumed from similar deposits", which is stronger than nothing.
4. Check for the statement that all elements have reasonable potential to be recovered and sold.
5. Rerun the numbers with your own assumptions using the metal equivalent calculator.

DrillScore rates intercepts on the individual metal wherever possible, and notes on the red flags page when an equivalent is reported without stated recoveries or prices. That is a disclosure observation under the published guidance, not a claim the company has done anything improper. This guide is general information only, not investment advice.

Equivalents and gram-metres

Be careful comparing gram-metres or %-metres calculated on equivalent grades with those calculated on a single metal. A polymetallic hole quoted at 200 %-metres CuEq is not directly comparable to a pure copper hole at 200 %-metres Cu. Where possible, compare like with like on the copper drill results page.

The short version

• Metal equivalents fold several metals into one grade using assumed prices and recoveries.
• Under JORC Clause 50 and ASX guidance, a report should show individual grades, prices, recoveries and their basis, the formula and a recoverability statement.
• ASX treats a missing recovery figure as an implied 100% recovery, which no real plant achieves.
• In our example the same rock reported between 0.64% and 0.88% CuEq depending only on assumptions.
• Always calculate the main metal on its own and rerun the equivalent with realistic inputs.