The appraisal of mineral reserves by a lender is carried out at the initial stages in developing a loan for a mine. The depth of investigations is influenced by the competence of the explorer, the type of commodity and knowledge of the geological environment. The lender looks for a reserve life which exceeds the term of the loan plus contingencies for events such as cost over-runs, adverse markets and production difficulties. The physical features of importance are discussed. Factors with direct financial implications are considered for their incorp- oration in sensitivity analyses to allow risk appraisal. When satisfied, the lender can then proceed to review cash flow forecasts, the basic strength of the project, then determine with the borrower the components and alternat- ives of a loan package.