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By Steven R. Davis

Voyageurs National Park in northern Minnesota, and a 30-mile radius area of influence on the United States side of the International Border, was examined for hardrock (nonferrous metallic minerals and diamonds) mineral potential and environmental sensitivity by the U.S. Bureau of Mines. The investigation also included an analysis of current Metallic Minerals Leasing Rules of the State of Minnesota, and the probable effects of changes proposed to the current rules by the State of Minnesota in order to "encourage mineral exploration and development." The study has determined that the proposed changes to the Minnesota State Leasing rules will have minimal, if any, impact on the likely, foreseeable levels of mineral-related activities in the State as a whole, and particularly, in the area of influence to the Park. Voyageurs National Park management was advised on the extent and character of the proposed rules changes, and on those items of concern meriting a specific and timely response by the National Park Service.

Jan 1, 1994

By Steven A. Fechner

In 1991 and 1992, the Bureau of Mines completed chromium, platinum-group metals (PGM), and tin investigations, and started indium, manganese, titanium, and vanadium investigations in Alaska. These studies were done as part of the Site Specific Minerals Investigations project. As a result of this work, the Bureau found PGM-bearing composite plutons in the Yentna River area of the Alaska Range, which are chemically similar to composite plutons in other parts of the Alaska Range and to Ural-Alaskan type complexes. Previously unknown chromium and PGM occurrences were found in the western Brooks Range. A compilation report on the Bureau's chromium and PGM investigations in the western Brooks Range was also published. Indium was found in anomalous concentrations at the Lost River tin deposit. Small occurrences of manganese were located, mapped, and sampled in the Wiseman and Chandalar quadrangles, and in the Liberty Falls, Prince William Sound, and Homer areas. Tin occurrences in western Alaska were summarized in three Bureau open file reports. The beaches near Cape Yakataga and Yakutat were evaluated for their titanium potential and a sampling methodology was developed. Vanadium investigations included examining streams in the Wiseman and Eagle areas that contained anomalous vanadium values. In the Eagle area, high vanadium, uranium, and copper values were found in the basal layers of the Road River formation.

Jan 1, 1994

Jan 1, 1994

The domestic mineral and material industry grew in some key sectors and declined in others during 1993; overall, the industry was poised at yearend for stronger growth in 1994. Metals production is expected to increase with anticipated growth in U.S. motor vehicle sales. There also may be increased demand for industrial minerals in 1994 based on domestic highway and building construction. Additional information on events, trends, and issues in the mineral and material industry is presented below and in the commodity sections that follow. Overall Industry Performance The value of processed materials produced from minerals in the United States during 1993 is estimated to have been about $326 billion, an increase of 5% compared with that of 1992. The estimated value of U.S. raw nonfuel minerals production in 1993 was $31.6 billion, about 1 % less than in the preceding year. The value of domestic minerals production has risen in 28 of the last 33 years.

Jan 1, 1994

The STATE MINERAL SUMMARIES publication provides estimated data and summaries of mineral activities at the State level for 1993. Most of the estimates are based on nine months data. Individual State summaries are published separately as State Mineral Industry Surveys and copies can be obtained from the appropriate State mineral officer. In an effort to facilitate the rapid dissemination of information and publications produced by the U.S. Bureau of Mine, an electronic document dissemination system is now available for use. MINES FaxBack is a simple-to-operate automated fax response system that operates 24 hours a day, seven days a week. All a user needs is access to a fax machine with a touch-tone telephone. MINES FaxBack can be accessed by calling (412) 892-4088, using the touch-tone telephone attached to the user's fax machine. After calling MINES FaxBack, the requester is guided by a series of voice messages to assist in ordering the desired documents.

Jan 1, 1994

By C Berglin

Is the Northern Territory different? Certainly it is more remote, has less people and relies more heavily on two or three industries for its survival. On the other hand, its mining industry is governed by Acts not dissimilar to those of the major States - a Mining Act provides the basis for acquisition of tenure, a Mine Management Act provides regulatory control, a Mineral Royally Act collects revenue in return for the right to utilise the land's bounties, an Environmental Assessment Act provides the public face to rehabilitation and environmental safety, and the Aboriginal Land Rights (NT) Act purports to give development criteria for inalienable land use. With the exception of the latter, at least until the advent of Mabo, all these are simply variations on a theme, and are common to most States. This paper will show how the Department of Mines and Energy works in relation to the Northern Territory mining industry.

Jan 1, 1994

By J G Reid

In the period since 1989 the Yabulu Nickel Refinery of Queensland Nickel has undergone a transformation both in terms of the nickel laterite ore feed and the refined nickel product. These two changes were mutually supporting, as will be shown in the following paper. It had been realised since the early-1980s that the Greenvale orebody would be exhausted by 1992. Consequently planning had been in progress throughout the 1980s for the importation of overseas ore as a replacement for the Greenvale ore. The existence of extensive lateritic ore deposits in New Caledonia and Indonesia made these locations the natural focus of attention. With the three Japanese ferronickel smelters sourcing their nickel garnierite ore feed from these locations it was relatively easy for the miners to supply the overlying limonite ore to Yabulu. This limonite ore was previously discarded as waste. The Yabulu refinery now receives about 85 per cent of its ore from these two overseas sources. The transition from Greenvale ore to imported ore occurred gradually between 1989 and 1993. It was during the ore importation planning stage of the mid 1980s that Queensland Nickel commenced the technical investigation which led to the ammoniacal solvent extraction (ASX) plant installation and the product change from nickel oxide to nickel metal.

Jan 1, 1994

By L. B. Pankratz

Thermodynamic data on carbides, nitrides, and other selected substances were reviewed, evaluated, and compiled at the U.S. Bureau of Mines Albany Research Center. Values for Cp°, S°, H° - H°298, -(G° - H298)/T, ?Hf, ?Gf, and log Kf are given in tabular form. Cp°, H° - H°248, ?Hf°, and ?Gf° are also expressed algebraically.

Jan 1, 1994

By Gillies A. D S

Rail, port and shipping charges represent 30 to 50 per cent of landed costs for Australian coal mines selling to Asia. This proportion is higher for sales to Europe, yet it is in Europe where Australian producers are aiming for increased market share. The landed cost of coal to the international customer is the key parameter which determines market competitiveness. The objective of this study is to examine Australian export coal competitiveness in terms of transport distance. The approach used examines world coking coal and steaming coal production and the transport distances between major exporting regions and importing countries. Reference is made to the importance of land transport costs and a comparative approach for emphasising the relative magnitude of this factor is developed. Models developed are examined in terms of Australia's exports and a conclusion is reached that a reduction in rail freight costs would be an effective measure for improving the competitiveness of Australia's coal industry.

Jan 1, 1994

By Butler I. K, Nicholson P. M

There are four main types of base metal and gold mineralisation recognised in the central Pine Creek Geosyncline. These are stratiform, polymetallic veins, stockwork/concordant gold-quartz veins and unconformity related uranium-gold-platinoid mineralisation. The stratigraphy of the central Palaeoproterozoic Pine Creek Geosyncline has been simplified into three groups comprising the Batchelor, Frances Creek and Finniss River Groups in ascending order. Stratiform mineralisation occurs within the Frances Creek Group. The earliest mineralisation is found adjacent to circular faults ringing basement highs. Higher in the stratigraphy, stratiform mineralisation is often associated with zones of high compression in the vicinity of basement highs. A synsedimentary-diagenetic origin for stratiform mineralisation is proposed. Polymetallic vein mineralisation occurs within the Frances Creek and Finniss River Groups. Its composition changes systematically through the stratigraphy similar to the stratiform mineralisation. The mineralisation is structurally controlled and usually occurs in the vicinity of basement highs. Stockwork-concordant gold-quartz vein mineralisation is hosted by the upper Frances Creek and Finniss River Groups. It occurs within compressional zones and along the Pine Creek Structure corridor around, above and particularly between basement highs. Mineable reserves occur in thick continuous semi concordant quartz-sulphide veins and/or stockworks. Unconformity related uranium-gold-platinoid mineralisation shows a close spatial relationship with the Palaeoproterozoic/Mesoproterozoic unconformity. The mineralisation is localised by structures formed during Mesoproterozoic deposition and is commonly adjacent to Archaean basement or its remobilised equivalents. The type of mineralisation (stratifom/polymetallic vein) is a reflection of local stress regimes, structure and physio-chemical conditions. An initial phase of stratiform mineralisation is postulated to have occurred with the first significant marine transgression in a tensional regime. A second phase occurred later during a compressive regime. "Ihermochemical sulphate reduction of mineralising fluids by hydrocarbons is invoked as the precipitation mechanism for the polymetallic vein type of mineralisation. Hydrocarbon generation is postulated to have occurred within the Frances Creek Group, in many places contemporaneously with the movement of mineralising fluids and basin compression. Polymetallic veins formed from the interaction of mineralising fluids and hydrocarbons which were trapped in suitable structures. An abundant, continuing supply of hydrocarbons was necessary to form significant deposits. Where these conditions were not net, the mineralising fluids largely continued their ascent to the near surface environment to form stratiform deposits. The stockwork/concordant gold-quartz vein mineralisation is a later event and occurred during the relaxation of compressional defonnation after deposition of the 1-inniss River Group.

Jan 1, 1994

By P G Simpson

The Sundance gold mine, located 2.5 km east of the town of Batchelor in the Northern Territiory, has produced over 5300 oz of gold since it was discovered in 1978. Sundance is unique in the Pine Creek Inlier in that the ore is hosted in palaeo-karst detritus and crystalline magnesite of the Early Proterozoic Coomalie Dolomite. This paper presents a summary of the geology of the mine, and describes the methods used during the two periods of mining.

Jan 1, 1994

By J I Stewart

The Copper Canyon deposits, occur in proximity to the regionally distinctive formational boundary between the Staveley Formation and Marimo Shale. The mineralisation here is associated with breccias, veins, and alteration zones near the base of the Marimo Shale unit and in the underlying evaporitic dolomite-dololutite dominant Staveley Formation. The Marimo Shale unit, in its basal 60 metres, is highly carbonaceous and hosts ubiquitous but minor diagenetic (?) copper-pyrite, and on occasion, extensive albite-microcline alteration centres, pyritic (cobaltiferous)-quartz veins, and microcline-quartz_+plagioclase veins or veinlet arrays. The most significant mineralisation, such as at the Greenrnount prospect, consists of a shallowly dipping package of alteration zones overprinted by multiple generations of pink-orange microcline-quartz-chalcopyrite-pyrite-(arsenopyrite) and albite-calcite- phlogopite veins. Accessory mineralogies in most of these mineralisation styles consist of tourmaline, monazite, rutile, and apatite. Chalcopyrite (and secondary chalcocite) and gold are associated with each generation of alteration but are best developed in the later stages of veining. In the underlying Staveley Formation, which is a conformable transition between the Corella Formation limestones and the Marimo Shale, chalcopyrite (cobaltiferous)-pyrite mineralisation occurs as disseminations in pre- and syntectonic breccias, and with disaggregated silica pseudomorphs (after thinly bedded evaporitic sulphate beds) and associated dolomitised limestone-calcilutite. Although this mineralisation may be partly diagenetic in origin the 200 in thick evaporitic packages are also host to a locally widespread (2 to 4 km long and 200 to >500 metres wide) and pervasive 'redrock' styled microcline-dolomite¦hematite alteration. Within this gross alteration package there also seems to be a consistent association with narrow (10 to 100 metres wide), linear (stratabound) semi-massive magnetite-hematite-microcline and quartz-chalcedony replacement zones. Like much of the nearby Corella Formation the Staveley Formation, under the Marimo Shale, has undergone dissolution, paleo-solution karsting (breccias) and tectonic brecciation such that the precursor lithological details have been progressively obliterated. The post-diagenetic to post-tectonic fluid pathway development and metasomatic alteration history of this important lithostructural package of rocks has been traced from preliminary studies only. The ability to do so is largely due to the absence of significant regional and contact metamorphic overprinting, and the local preservation of precursor sediment profiles. It is proposed that both the base of the Marimo Shale and parts of the underlying evaporitic-limestone-dololutite have acted as conformable fluid pathways for hydrothermal and (perhaps) diagenetically derived, Cu-Au-(¦Co ¦As) K-Na-Ti-REE bearing, fluids and brines.

Jan 1, 1994

By White A. H, Gillies A. D S

In recent years the Australian gold industry has gone through a major expansion phase. The need for finance has led to adoption of different approaches such as the well known gold loan, forward selling, equity participation by suppliers and equipment leasing. During early periods of the expansion, significant new equity was raised chiefly for high risk exploration ventures. The major form of new equity finance was ordinary shares, often in 'No Liability' companies. The increasing capital requirement of the huge new development projects of the 1980s also spurred the use of debt finance. This trend was accelerated as high inflation and the taxation advantages of debt finance made borrowing attractive. This paper reviews major financing techniques used by the Australian gold industry with particular emphasis on the innovative financing techniques initiated recently. An analysis has been undertaken of the effects on the industry of issues such gold loans, forward selling, equity participation by suppliers, fly-in fly-out operations, contractor mining and equipment leasing. In order to achieve a better understanding of the innovative financing techniques, a survey of already published financial data from well known Australian gold mines was carried out. Data was collected from various published financial reports of gold mining companies. In addition, a questionnaire survey was sent to gold mining companies to assist the collection of further information. The results of this study show that there are a significant number of gold mines variously using gold loans, forward sales, contractor mining and fly-in and fly-out arrangements to finance their projects. Only four operations have vendor suppliers investing capital funds in their projects. Based on the findings of this study, conclusions and recommendations are drawn that these approaches are likely to be with Australian gold industry for some time in the future and will continue to be intensively applied to finance gold projects.

Jan 1, 1994

Banks' focus in using cash flow methods can differ markedly from that of equity investors. This paper attempts to explain and describe bankers' approach by: ò outlining the fundamental difference between banks' and investors' risk / return profiles. ò describing lenders' consequent use of cash flow methods in mineral valuation. areas. explaining lenders' specific treatment of key risk Fundamental to understanding banks' appraisal of mineral projects is the appreciation that lenders have a basically different risk profile and outlook from those familiar to equity investors. Lenders do not normally participate in any project upside. The economics of lending dictate that banks can only accommodate a low probability of loan default and consequently banks' principal focus in mineral ""valuation"" is ensuring an acceptably comfortable probability of debt repayment. A simple conceptual explanation of lenders' risk / return position is outlined.

Jan 1, 1994

By Dodd SF

Valuation of mining companies and their underlying assets prepared by brokers' analysts are, by necessity, approximations. The reliability of the valuations is entirely proportional to the quality of available data, the reliability of forecasts and the nature of underlying commodity price assumptions. The latter is perhaps the greatest single cause of gross variations in company and asset earnings estimates and- valuations. Assumptions are often necessary regarding commodity price achievement based on commodity hedge positions. Public disclosure from listed companies provides a sound base from which to project earnings, cashflows and balance sheets. The uncommon disclosure of projected production and cost schedules often reduces the reliability of future estimates. The application of reserve and resource estimates is contentious with practitioners applying differing weightings to importance of resources in estimating mine lives (and therefore cashflow streams). Valuation methods applied in equity markets usually focus on relative value and the identification of pricing anomalies. The commonest ""rules of thumb"" applied in the valuation of mining companies (and therefore their underlying assets) is with the use of year specific price/earnings (P/E) and price/cashflow (P/CF) ratios, with low multiples suggesting undervalued assets, high multiples overvalued situations (but these rules can often be clouded by market expectations of underlying commodity price movements). Another simply applied valuation tool is to examine the examine the value placed on reserves and resources by the market. Inexpensive gold in the ground (expressed as $ of market capitalisation per ounce of reserves or resources) might indicate a buying opportunity, but the market does discount the value of gold in the ground prior to mine development and where development risk is perceived.

Jan 1, 1994

DCF Valuations are very important to individuals and companies involved in the mining industry. Such valuations are critical to investment decisions in relation to new and existing projects. In particular they provide fundamental information to shareholders in the event of a capital raising or takeover and to financiers supporting mining companies and projects. Also, DCF Valuations are often used to support asset carrying values in the financial statements of mining companies. This paper presents a Chartered Accountant's (CA's) perspective on the main issues to be considered in preparing, analysing and relying upon DCF methods in mineral valuations and provides some practical examples relating to key issues. The paper makes the important point that DCF methods involve making assumptions about future events and circumstances that inherently contain uncertainty which results in a valuation prepared on a DCF basis providing a range of values that are not perfect or accurate. In order that DCF valuations provide meaningful information the underlying methodology used and assumptions made must be consistent, sound and well supported. Credibility of those involved in preparing mineral valuations is vital and this paper supports the adoption of sound practices by all concerned.

Jan 1, 1994

By M. J. Virnig, G. A. Kordosky

Throughout time, the mining industry has been very successful in meeting the world's requirements for metals and materials while meeting the challenges of decreasing ore grades and increased emphasis on protection of the environment. This success has been due to the development and implementation of new technologies. A clear example of such a development over the past 25 years is the increasing use of leaching/solvent extraction/electrowinning for the recovery of copper from oxide and sulfide ores. The key to the successful introduction of this technology was the discovery and development of the hydroxyoxime liquid ion exchange reagents by General Mills Chemicals (now Henkel Corporation). An important role was also played by the close working relationships between General Mills Chemicals and Ranchers Exploration which resulted in startup of the first plant in 1968 and between General Mills Chemicals and Bagdad Copper which resulted in the startup of the second copper SX-EW plant in August of 1970. Following on the heels of the hydroxyoxime development came the commercialization of other new chelating reagents based on different chemical functionalities, i.e., beta-diketones, alkylated 8- hydroxyquinolines and sulfonamidoquinolines. This initial spurt of activity was then followed by a slowing of development in terms of new reagent functionalities. Activity has continued in terms of further optimization/improvement of existing reagent functionalities but the commercialization of new reagent functionalities has slackened. This observation reflects the fact that the development of new reagent functionalities for metal recovery has become increasingly more expensive such that the right combination of price and sales volume must exist in order to justify the investment required to bring a new reagent to the market place. Given the dependence of the mining industry on innovation to meet the needs of the future, one can ask how these new developments, particularly in new reagents, will occur. To arrive at an estimate of the costs involved in commercializing a new metal extractant functionality, particularly a chelating type functionality, a case study of the development of LIX ®* 34

Jan 1, 1994

By McMahon D

The approach to valuations at the Normandy Poseidon Group is a measured and methodical process that utilises skills sourced from a number of different disciplines. Whilst being subject to a strict set of guidelines, it is also sufficiently flexible to be able to cope with the considerable variety across the resources industry. The group uses Discounted Cash-Flow (DCF) techniques extensively in order to develop a base valuation. Other external factors (eg the market) are, however, also taken into account when forming a view on value. Other methods of valuation are used in tandem or as alternatives depending on the task. DCF techniques are an important tool but would never be used in isolation. Considerable care must be given to developing the DCF analysis as its components (eg discount rate) are prone to misuse. Whilst the valuation process is quite detailed and scientific, it is really only as good as the inputs or assumptions (technical, financial, etc) that are used. The methodology used remains consistent whether the group is undertaking the corporate planning process or making an acquisition.

Jan 1, 1994

The words ""Uncertainty"" and ""Risk"" pervade every discussion about mining exploration and investment. Perhaps these terms are subjectively understood by industry professionals, but objective portrayal of these concepts outside the industry is a woefully undeveloped science. This paper addresses current industry understanding and practice regarding quantitative risk assessment techniques, and provides examples of the application of three of these techniques. Probabilistic techniques for financial risk assessment are valuable adjuncts to conventional financial analysis, and address a range of issues not assessable by any other means. The value of whole-of-project probabilistic risk assessment is currently debatable for decision-making purposes, but is seen as important as a mechanism to focus attention to the critical issues that ultimately impact on project success. The dissection of project capital into risk and non-risk components provides valuable insights into risk characteristics not readily quantifiable in any other way. This technique also provides a framework for more objective ""what if?"" scenario evaluation and for the capital structure of resource projects. Finally, mechanisms for the valuation of undeveloped reserves are examined, and guidelines suggested. The importance of reliability in production cost estimates is highlighted and the impact of early development on reserve valuations is discussed. The importance of economics throughout all stages of the evaluation process is fundamental.

Jan 1, 1994

By J Kokado, N Hatta, S Yabushita

A theoretical model is described for prediction of the capacity of fines from porous ores, such as cokes and sintered ores, to be removed by a pneumatic, horizontal-type classifier prior to charging into a blast furnace. First, the influence of variation in the apparent density and drag coefficient of porous ores on removal efficiency is analysed from a stochastic standpoint. The effect on efficiency of collisions between particles in the classifying region is then examined analytically in relation to the ratio of the mass flow rates of particles and air (the loading ratio). Finally, a theoretical model is constructed that takes these factors into account. Theoretical and experimental results are compared and classifying efficiency is discussed from both experimental and theoretical viewpoints.

Dec 1, 1993