The gloom that has hung over the extractives industries in the near-decade since the global financial crisis seemed finally to have lifted at September’s conference in Christchurch of the New Zealand branch of the Australasian Institute of Mining and Mineralogy (AusIMM). By HUGH DE LACY.
THERE WAS NO DANCING in the streets by the 220 delegates at AusIMM 2017, but the atmosphere at the conference was distinctly more confident than last year’s subdued event.
The overarching positives seemed to be the steady strengthening of the global high-grade coking coal market, the firming trend for gold as the Donald Trump administration in the United States generates increasing uncertainty, the positive post-Solid Energy outlook for domestic and export coals, and the consenting of Trans-Tasman Resources’ seabed mining project.
Coking coal is bouncing around the US$200/tonne (NZ$260/t), prompting local exporters with mothballed or non-producing mines to start thinking of cranking them up again, and at around US$1300/ounce (NZ$1700/oz) the gold price is likewise encouraging.
The local coal industry, both thermal and coking, has consolidated around the joint venture between listed Australian collier Bathurst Resources and the diversified New Zealand food producer and marketer Talleys.
It seemed like an odd association when the two got together to step into the liquidated shoes of Solid Energy, but Bathurst Talley Mining (BTM) has filled the role of the former state-owned collier as the dominant player in the local game.
It means continuity of production at the Stockton export mine on the West Coast, no less than at the main thermal sites of Rotowaru and Maramarua in the Waikato.
Other former Solid Energy assets, the Liverpool and Strongman mines, have been sold to West Coast miner Birchfield Coals, while the Ohai and New Vale opencast mines in Southland have been snapped up by Greenbriar, a subsidiary of the Palmer MH Group.
Bathurst chief executive Richard Tacon told Q&M that it was Talleys principal Peter Talley’s idea to form the coal-mining joint venture, as much because Tacon saw potential in the sector as for the family company’s own need for about 100,000 tonnes of thermal coal a year to fire the boilers of its various processing plants.
While prospecting was the recurrent theme of the gold papers presented at the conference, the recent emergence of New Talisman Gold as a market darling was also a hot topic, following its release of new prospecting data that puts its historic underground mine near Waihi among the top five percent of the richest fields in the world.
New Talisman will always be a minnow, but any mining company whose share price trebles in a week adds excitement to the local industry.
And then there was TTR’s successful second application to the Environmental Protection Agency to mine iron sand from the seabed floor off the coast of Taranaki.
The chief executive of mining lobbyist Straterra, Chris Baker, told Q&M that while the decision gave confidence to the domestic mining industry that science, not emotion, will continue to govern resource consent decisions, the greater impact was on “the externals”, the perception of the industry by overseas companies contemplating mining here.
“The TTR decision, in the face of the protests against the scheme, will reassure foreign companies that New Zealand’s open for business,” Baker said.
Latest South Island data released
NZPM RELEASED the data, covering Murchison, Otago and northern Southland, at noon on the first day of the conference as Rattenbury was speaking in Christchurch.
The aim is to encourage exploration and mining of our mineral resources.
The government agency used $8 million from the 2014 Budget to fund the extension of the aeromagnetic data to more than 30 percent of the country.
Regional aeromagnetic surveying, now 75 percent complete, has accumulated more than 140,000 kilometres of data.
The latest soil geochemical survey gathered samples from 909 sites between the three regions.
Grid spacings of eight kilometres were applied for most of the area, narrowed to four kilometres and two kilometres over selected areas.
The first of two papers Rattenbury presented explored the new aeromagnetic dataset for eastern Nelson and Marlborough, which reveals areas of anomalous magnetism “that can mostly be related to known magnetic-rich igneous and volcanogenic sedimentary rocks.
“Some of the prospective host rocks are inferred to lie at shallow depths beneath rock and sediment.”
The number of tectnostratigraphic basement terranes compressed across barely 130 kilometres of Buller-east and Nelson-Marlborough was an outstanding feature of the geology.
The magnetic and radiometric data was acquired by helicopter at a 200-metre line spacing with a target ground clearance of 35 metres, oriented at 110-290 degrees.
The most prominent Nelson-Marlborough feature was a zone of strong positive anomalies extending from Red Hill north-east to Croisilles Harbour.
The new aeromagnetic data covered parts of Southland and, combined with existing data from the Longwood Range, provides high-resolution coverage across several major basement tectonic units.
“Exploration potential of the region has been raised through affirmation of geological mapping, identification of new structures and near-surface occurrences of potentially mineralised host rocks,” Rattenbury’s second paper, co-produced by SC Cox, AP Martin and N Mortimer, said.
The basement Southland-Otago region’s geology is defined by five terranes ranging south-east to north-west, is Permian to Early Cretaceous, and is dominated by schist and semi-schist.
“The exploration potential of these new aeromagnetic datasets for locating new mineral deposits in the region lies more in identifying prospective host rocks and three-dimensional geometry than imaging mineralisation signatures directly,” the paper says.
“Mineral prospectivity in the surveyed area ultimately lies with the Brook Street volcanics terrane and median batholith rocks, and the survey has revealed new places where these rocks are likely to occur at shallow depths below covering strata or sediment.”
The two South Island surveys complement those produced over Northland in 2011 and the West Coast in 2013, and take to 35 percent the coverage of the country’s land area by high-quality geophysical data.
The geophysical information provided by these programmes, which are ongoing, offers the industry high-resolution data, supplemented by geochemical data, that is free to use and reduces the risk of minerals exploration.
Ground radar discussion
On its own, ground penetrating radar (GPR) is a useful tool for locating placer gold deposits, but the data it produces is at its most useful when part of a “coherent exploration programme”, Mike Finnemore, of Christchurch-based consultancy Southern Geophysical, told the conference.
“GPR SURVEYS CAN quickly and cost-effectively characterise the architecture of the near-surface substrate in both two and three dimensions,” his paper said.
GPR has the highest resolution of any geophysical method of imaging near-surface features, creating a nearly continuous image of the sub-surface.
In the field, an antenna and control unit, which looks like an orange box with a trailing odometer wheel, is towed over the ground by a quad-bike.
The antenna transmits pulses of electromagnetic signals at set frequencies, and gets a reflected signal back from whatever is below the surface, with the strength of the reflected signal largely dependent on the contrast in dielectric permittivity between the materials it bounces off.
The higher the frequency, the higher the resolution of the images produced, but also the less the depth to which it can penetrate.
A frequency of 200MHz was found to give a balance between resolution and penetration, though up to 400MHz could be used to improve near-surface resolution, while 100MHz allowed penetration to a depth of as much as 25 metres.
Finnemore, presenting data co-authored by C Ruegg and C Watson, said their GPR tests were carried out at two secret locations chosen with the consent of the permit-holders from a number of commercial and hobby placer gold mining sites.
At the first site, the aim was to trace a channel on a site of otherwise little-known geology, which the imaging showed to be a large paleochannel structure infilled with boulders and coarse gravelly material.
There were two objectives in the GPR survey of the second site, the first being to delineate the boundaries of a permit area by identifying the extent of extractable gravels.
The second was to locate paleo-channels and plot their orientation.
The exercise showed that the main drawback of GPR, which has been around for about three decades, “has been the lack of systematic and robust geological ground-truthing”, the paper said.
“Correlation information that has been provided by clients is often approximate, without geological naming conventions and accurate positions.
“The value of GPR to clients could be increased dramatically at a very low cost simply by engaging a geologist to accurately record and log test pit information.”
That said, the paper concluded that GPR is a useful tool for placer gold exploration on the West Coast, with depth penetration ranging between seven and 15 metres.
“The level of detail obtainable with the GPR system is excellent, with pockets of boulders, paleochannels and sedimentary horizons clearly imaged,” it concluded.