Mining exploration and geology in Australia.

This is the third article of a six-part series exploring the trends and key themes that are shaping the future of the mining industry. 

Australia is abundant in natural resources, rare earth elements and world-class minerals. As we move into the future, mining exploration of Australia’s untapped potential is vital for a long-term supply chain. Mineral exploration is the attempt to understand the geologic history of a region, to predict where some minerals might have been deposited. There are several parts of mineral exploration that a geologist participates in. These include:

• Describing known mineral deposits
• Determine where the ore “will be” as the mine digs deeper
• Finding new prospects for mineral deposits

In mines already under exploration, geologists describe the characteristics of the ore and try predicting where in that mine digging must happen to find more ore. Geologists make geological maps describing the rocks, structures and minerals that occur in the area they are mapping. An exploration geologist looks at the maps and assesses to see if they correlate with the characteristics usually found in the deposit. Typical scientific research is conducted on mineral exploration. 

So, what is mineral exploration?

Mineral exploration refers primarily to the collection of geological data (including evidence of mineralization) relevant to assessing the potential for an economic ore deposit. It involves the process of detecting or exploring the presence of mineral potential in a particular given area. Mineral exploration is carried out with remote sensing technology and by geophysical methods. Geological mapping is followed by sequence of drilling in that given area to know the presence of mineralization. This can include field data from surface outcrops, sampling of stream and lake sediment, airborne geophysical surveys, drilling for core, etc. 

How is mineral exploration modelled?

To understand how to model mineral exploration it’s best to understand the rationale of management and their use of capital. The mining and mineral extraction industry is defined by finding and developing economic deposits of resources. For example, in mining gold/iron/copper the goal of an exploration company is to find a sizeable deposit that is economic to develop. All mineral deposits that are extracted today would have started with management believing the resource existed on the land but with no reserves associated to support a development. 

Role of mining geologist vs mineral exploration geologist.

Mining geologists are responsible for working on mine plans to recover as much as mineral ore possible to extract. They plan and execute the mining plan which includes step by step processes for ore excavation. They plan suitable place to enter an underground mines and further efficient mining methods for maximum ore recovery. In open mines, they plan benches to recover the ore.

Exploration geologists on the other hand explore new areas for the assessment of economic minerals. Assessment includes geological, geophysical, and geochemical exploration methods to assess the quality and quantity of the ore minerals. In general, it can be said that exploration geologist explores mineralised area which is further excavated by mining geologist.

Brownfields vs greenfield exploration

The premise for brownfields exploration is that the best place to look for new deposits is where ones have already been mined. So, brownfields exploration takes place in and around old mines or mineral fields. The geologist search for extensions of known deposits or previously undiscovered (blind) deposits.

Many mineral fields have not been deeply drilled. Re-interpretation of the geology may suggest new targets for deposits that don’t daylight (reach the surface). Geophysics and geochemistry may be applied to identify targets not previously recognised.

Greenfields’ exploration generally starts with a geological theory. Sometimes this is original thinking such as that related to lineaments that are credited for the discovery of the Roxy Downs/Olympic Dam copper, gold uranium deposit in South Australia. Alternatively, and probably more commonly, it is a geologist looking for analogues of know deposits and identifying geology that appears to present a similar environment to known deposits.

In either case, geological mapping, geophysics (airborne and terrestrial), and geochemistry are usually the first steps in exploration to try and exclude areas that are not prospective and focus on those that are and identify targets for drilling.

Australia’s mineral exploration expenditure reviews.

The total mineral exploration budget rose from 2018 to 2020 which is consistent with the signs of a mining boom in Australia. The same trend is observed for brownfield expenditure although a decrease was experienced in greenfield expenditure from 2019 to 2020. See table below 

Australia’s mineral exploration expenditure by jurisdiction.

In 2018-19 and 2019, Western Australia had the biggest share of exploration expenditure with 61% of total expenditure. The trend continued in 2020, with Western Australia registering the largest share of exploration expenditure with 62% of total expenditure. 

Australia’s mineral exploration spending by commodity.

Gold and copper consistently topped Australia’s mineral exploration spending by commodity for the years given. 2020 saw the introduction of mineral sands coming in above the mineral exploration spending of coal. The marked decline in coal exploration spending in 2020 can be associated with the onset of trade tensions between China and Australia. 

Minor commodities are related to spending associated with minor commodities such as lithium, manganese, molybdenum, phosphate, tin, tungsten and vanadium.

The fourth article of the six-part series explores the future of the mining workforce.

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