Geology: Narrow Veins & Resource Deposits

Narrow Veins

Narrow deposits, narrow geological features need to be extremely high-grade to avoid the problem of vertical tonnes per metre. Quite often I see people coming out with “exciting results” and they’re talking about high grades over narrow thicknesses but my goodness, those are pigs to get into a resource category that’s going to excite the market. The reason is that it’s really hard to add your tonnes and so they might go down and down and down but if they 1m, 2m, or 3m, you need to have superb grades to be able to get the market to be excited.

Occasionally, you can get away with having 1m at 20g/t. You’re never going to be able to put a big resource together on it and it’s much better to almost keep it private and just have it as a small family operation that produces a few thousand ounces per annum and is a money-printing machine. It’s not really the kind of thing that’s going to work in the public market. As a reader of news releases, be careful of that.

Another thing to be careful of is that geologists will always drill their best anomalies first. A good deposit is an economic deposit, and those economic deposits are really rare. If you go to the best anomaly, you drill your best drill hole and you get a good result, yay. But what that does mean is that after that it’s going to be very hard to replicate the quality of the drill hole that you got in your first drill holes. In order for your deposits to average out as an economic proposition, that means that you need to have a really spectacular hole in the mix, and you need to have a few of them coming down the lines. What I really like to see is not just good grades, but good continuity as well and a good spacing out of those drill holes to show that this thing carries and carries and carries because it’s so hard to get a mass of rock with that concentration factor, again I come back to Gold, 250x concentration factor over a big tonnage, blooming hard to achieve to get that mixture of something that is trapping Gold to precipitate into the rock mouth at that particular point time over time over time. I like to see a few 10m at 25g/t or a couple of 200m at 1.5g/t to 2g/t. These are ‘shoot the lights out’ results but to carry an economic deposit, it’s kind of what you need.

Gold is hard to find and very difficult to get decent tonnes. Continuity will always be a challenge. If you can recognise a strong geological system with reliable intercepts, then it’s worth sticking with. A good deposit is worth sticking with. They don’t come around very often and remember that it’s so hard to find that an exploration company will try to make a silk purse out of a sow’s ear but if you as the reader can really see and find a strong system with reliable intercepts, stick with it. Yes, it will need quite a lot of drilling but it’s important that the team is able to show continuity over decent drill spacing. Watch out for highly sheared or deformed orebodies; they’re just so hard to drill out.

Copper porphyry

Here tonnes are much less problematic than grades. In Gold deposits, it’s very hard to get the tonnes up. In a Copper porphyry, it’s quite easy to get your tonnes up very quickly. These are bulk geological processes and therefore drilling out tonnes is relatively easy. You can probably drill out 200Mt - 300Mt with 12,000m - 15,000m of drilling. However, finding a decent grade is very rare because you need 80x enrichment of your Copper grade to make it economic above background yes, let’s say you’re in a fertile part of the Andes or Arizona, you’re on probably significantly enriched above global background concentrate. You’re a quarter or half of the way there. Then in your porphyry in your intrusion you have precipitation happening, gradually enriching your single stock, your porphyry story. It’s getting richer in volatiles and metals at the top. Then finally when the pressure situation is right, the next phase of the intrusion goes up and you get this sub-chamber that’s enriched. At that point, you want to have crackle breccias and dissemination of fluid flow, and heat engines and hydrothermal processes, and Copper mineralisation to be disseminated around the alteration halo above your secondary chamber.

It’s hard to find the right enrichment there. You either need to have it super enriched in the pre-fractionation, in the melt, or you need to have supergene processes or multiple pulses and the Copper precipitating out in the same places time and time again. It’s a very specific set of criteria. It’s hard to find good grade porphyries. Porphyries to a penny, tonnes to a penny, a decent grade is much harder. If you find a good one, stick with it, it’s valuable.

VMS deposits

These typically occur in clusters. Most of them are small. 80% of known VMS deposits globally are less than 10Mt however most of them come in clusters and the average size of those clusters defined as around 17Mt - 20Mt. Obviously, if you’re in a mineral district where the exploration is being encouraged by good results then the cluster size is around 30Mt. I would say the challenge with VMS deposits is the metallurgy. It’s relatively easy to find them if you’ve got the right geophysics, the right geology. You start unlocking the key to the distribution of those deposit types in your district. Where the metallurgy is challenging and the reason being is that these were formed right at the interface between the earth and the ocean, so they’re sub-marine deposits. It’s the mingling of seawaters with these hot fluids, you have pulses of volcanism and extrusion onto the seabed. That would be just sub-surface intrusions, you’ve got your heat engine in an ongoing rifting environment, so you have quenching of your minerals as it mixes with the seawater. You’re going to have long-lived crystallisation events. You can have instantaneous crystallisation events. Sometimes you can have very fine-grained structures. You can have almost gel-like precipitation of minerals that haven’t even had a chance to form crystal shapes yet. It’s just an amorphous, instantaneous precipitation event which of course means separation of your value product is extremely hard and you can have deleterious elements locked into the, not even the lattice. That is the challenge for VMS deposits, and we’ll go into that more in the next discussion, which is one metallurgy.

Iron ore and Coal deposits

Logistics, logistics, logistics. The grade of Iron ore is important. Tonnes are no problem at all. I can take you to billions of tonnes of low-grade Iron ore that’s never going to come out of the ground. Your initial target is to find lump Iron ore, which is very hard to find, but once you do it then you’re really just talking about logistics. Once you have found it and you’re talking about logistics, as for a magma type deposit, anything with fines which you have to grind fine because it’s let’s say a 31% or 33% Iron deposit, which means you’ve got a lot of Silica in there in the form of Quartz. You’re going to have to grind it fine to separate the Quartz from the Magnetite grains. Just forget it. Walk away. It’s too much heartache, too much hard work. As soon as you’re grinding, you’re suddenly dealing with pipelines, slurries, Blaine indices, is this going to flow, to howdy you separate your magnetic separation, high density grinding rolls, great but then you’re into slurries and pilot plants. That’s the job for the big boys.

Rare Earths deposits

Bastnasite, really you’re effectively looking for Bastnasite. That’s the key mineral for Rare Earth deposits in Carbolatide. There’s so much hoo-hah about Rare Earths. I’m not a believer, principally because if you look at who owns the processing technology of the semi-finished product, it’s the Chinese. Primarily most REE companies will need to have a CHinese component in the supply chain. There then comes as issue of where the margins are made. If a company can build an entire processing chain then they have a large a ready market in the US and Europe looking to secure the critical minerals with western partners.

Nickel Sulphide

There’s plenty of Nickel Laterite out there but the costs of development are pretty challenging, very much preserved with the big guys, multi-billion-dollar builds. If you’re a Nickel explorer, it’s much easier to go for the Sulphide deposit but it’s very hard to find the grade because that enrichment process where you get the concentration of Nickel is 70 times higher than background is very hard to do. You can find it where you’ve got it 7 times or 10 times but to enrich it 70 times appears to be very hard. You’re going to struggle to find the tonnes at the right grade, Nickel is very hard to beat. We’ve got the Bushveld and the Duluth complexes, and the Sudbury and Norilsk-Talnakh, which are these superb deposits.

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