2 What is mineral exploration? Exploration is the term used to - PowerPoint PPT Presentation

INDABA PRESENTATION CAPE TOWN | FEBRUARY 2017 AIM:SAV W HAT IS M INERAL E XPLORATION ? AIM:SAV

2 What is mineral exploration? • Exploration is the term used to describe a wide range of activities aimed at searching for minerals or determining the extent of a mineral discovery or deposit • It includes activities such as soil and rock chip sampling, ground-based and airborne geophysical surveys, and drilling Diamond Drilling at dusk

3 Who are exploration companies? • Exploration companies are seeking to find a mineral deposit worth mining and generally have no income (other than interest earned on previously discovered mineral deposits, or proceeds from the sale of a project) • As such, exploration companies generally fund their search efforts by raising funds to conduct mineral exploration (e.g. shareholder investment)

4 What is the role of exploration companies? • Mineral exploration companies play an important role in the development of a country’s mineral resources • When minerals are mined, the company selling the product must pay a royalty to the government (or crown) • The royalties are set by the government at a level that will encourage others to risk their capital in finding and developing these minerals, rather than the government risking taxpayer’s money o This way the country can share in benefit of mineral resources without risking funds required for key everyday services to the community

5 The mineral exploration cycle

6 Identify prospective ground The start of the process comes from the generation of ideas, which are based on the geology of a region, company exploration models and the broad scoping of potential resources that might suit a current commodity market Geologists will look at other known deposits to determine how and what geological process formed them They will then use these models to find conditions that are similar in different regions of the state and other countries These models and concepts continually change as more is Markets for mineral commodities are known about the area they are exploring always changing (based on supply and demand) and can significantly impact on the process of The market defines the resources that are of interest and exploration may be profitable and hence drives much of the exploration being undertaken

7 Low impact exploration Low impact exploration, or ‘early’ exploration as it • is often referred to, generally results in minimal ground disturbance with limited rehabilitation requirements This form of exploration aims to cover large areas • of ground (possibly 100s km 2 ) to identify specific areas for further, more detailed assessment The exploration company will initially use a range • of low impact methods to generate potential mineral targets and increase their knowledge base, and generate a target for advanced exploration The most common forms of low impact exploration • activities include reconnaissance work to: o better understand the geology o evaluate environmental conditions o determine how best to access the area o meet with landowners o verify previous work

8 Low impact exploration: visual inspection Geologists and other scientists visit locations to look at the rocks and take measurements to assess whether the area may have potential for minerals

9 Low impact exploration: geological studies • Includes geological mapping, mapping of landforms and the general environment • Mapping involves walking and/or driving across the land to map relevant features (e.g. the geology of the area)

10 Low impact exploration: rock chip sampling • Any rocks which may be of interest to the geologist are sampled using a rock hammer to collect 1-3kg of rock sample • The sample is then sent to the laboratory for assaying to determine if the rocks have any minerals in them • This work is usually completed on foot using vehicles to access an area

11 Low impact exploration: soil and stream sampling • Samples of about 250g of stream sediment or soils are collected and sent to the laboratories for assaying to identify if minerals are located in the area • This work is usually completed on foot using vehicles to access an area

12 Low impact exploration: geophysical surveys (excluding seismic) • Involves the collection of geophysical data for spatial studies (e.g. density, magnetic, conductivity, radiological properties) • A variety of instruments can be used to collect the data • Instruments can be carried by hand, vehicle or by aerial survey, (e.g. plane, helicopter) Ground based geophysics – Airborne Geophysics – Example of targets generated Ground EM common copper VTEM common copper by geophysical testing exploration method exploration method

13 Advanced exploration • Companies design advanced exploration programmes to test potential targets • The location of the targets identified will depend mostly on the results of the low impact exploration conducted and any land access requirements • Advanced exploration, especially drilling, is concentrated within small areas of <1km 2 • This can include exploration activities such as drilling (and associated activities), exploration methods involving earthworks (small costean or trenches) and seismic activities • Advanced activities almost always involve some form of earth moving activities to allow exploration activities to be conducted safely. If the exploration is not successful then the earth works are rehabilitated

14 Advanced exploration: reverse circulation drilling • Samples are collected at 1m intervals and assayed for minerals. These are typically drawn on cross sections, together with the outline of any mineralisation defined • Reverse Circulation drill rigs use air and a metal bit or hammer to drill a hole by crushing the rock and using compressed air to blow the sample to the surface, where it is collected for sampling

15 Advanced exploration: diamond core drilling • Diamond core drilling uses a diamond drill bit to core rock, which is then split into 1m samples and assayed for copper • Depending on access to site the construction of a road and a drill pad to provide a safe working environment to drill the hole may be required, which is usually constructed using a front end loader, which builds a pad about 20m long and 15m wide

16 Mineral discovery • Once an explorer locates a mineral discovery or a potential deposit they may undertake more intensive exploration activities and commence various studies (e.g. environmental studies) to determine if they have a viable mineral resource • To determine this, explorers may go through the following stages: resource drill out, resource definition, scoping study, pre-feasibility study, and bankable feasibility study (each of these stages is explained in the following sections) • It is extremely important to note that throughout these stages, mining concepts (including deposit size, location and infrastructure requirements) may change significantly as more information is obtained about the deposit, suitable mining methods, processing requirements and infrastructure needs • In most cases, the final mining concept will not be known until the bankable feasibility study is underway or completed. This is also the stage in which the majority of companies will submit mining applications to the government for assessment

17 Mineral discovery: establishing resource viability Resource Drill-out Once a potential deposit has been discovered a • resource drill-out is undertaken This is to enable an initial estimate of the grade • and tonnes of the potential mineral resource by defining the extent of the mineral deposit, and to provide enough information to be able to make a confident estimate of the total resource Resource Definition All the information gained through the drilling • program is then used to calculate the volume, quality and shape of the mineral resource. Three dimensional computer-generated models are • produced to better define the shape and volume of the resource, along with information on chemical assays and mineral concentrations. This information will be used to determine the • type of mine required in the studies below

18 Mineral discovery: establishing resource viability Scoping Study The scoping study includes (but is not limited to) the assessment of: A scoping study is undertaken to develop a broader picture of the Economic factors – the financial value of mining • value and potential of the based on varying market prices for the product mineral resource and the Infrastructure requirements – requirements for • requirements for transport to market, including distance and infrastructure required (e.g. water, power) successfully mining it. This is a high level assessment Environmental/social risks – potential impacts to • the community and environment based on the of the costs and benefits proposed mining activities of the prospective mine to Physical characteristics of the mine – potential determine whether it is • processes required to extract the resource, viable to progress towards whether to use open cut (pit) or underground a more rigorous mining assessment Metallurgy – processes required to extract the • resource from the host mineral and costs of extraction options