Fraser: Okay, let’s talk about the process of exploration and how it has evolved over the years. Some investors still have this image of prospectors wandering through the mountains with gold pans.
Lawrence: Yes, don’t forget the mules and pickaxes. In decades long past that was how it was done. Today, geological science is as sophisticated as any branch of science. Today’s geologists have the ideal situation: There are mountains of data collected over years or even decades. That existing data provides a great starting point to apply advanced scientific tools and techniques to extract information that was not available to the old timers.
Fraser: Data mining, literally.
Lawrence: Exactly!
Geologists today have the benefit of those many decades of work that has already been done. In British Columbia, and many other jurisdictions, one of the conditions of holding a mineral tenure, or a “claim”, is that the claim holder must do a certain amount of work on the claim each year, and they must file a report documenting the results of that work. Those reports are available to the public. Way back, prospectors and geologists were attracted to places where the minerals stuck out of the ground. It was common for a claim holder to look at his small piece of the geological picture and not recognize the significance. Maybe it’s a vein that doesn’t go very far on surface. Or, maybe it was a bigger occurrence, but too low grade to be interesting. For each of those explorers, it was like looking at one piece of a jigsaw puzzle. The picture only begins to make sense when you put a few pieces together. Today, we have the benefit of all those individual pieces that evolved over many years. And, we have a much better understanding of the science underlying the geological systems that created those deposits.
Fraser: How have metal prices impacted exploration?
Lawrence: Higher metal prices are having an enormous impact. For example, Teck, in the 1970s, drilled off a big porphyry copper deposit called Schaft Creek, located in the Golden Triangle. They assayed for copper but ignored the gold, which was common at that time, with a low gold price. A junior optioned the property and re-assayed the old drill core for gold. They found 5 million ounces of gold that the major had overlooked. That gold, added to the copper value, makes it an attractive deposit. Not surprisingly, Teck bought back into the project and is now advancing it.
Another really important factor is that, in many areas, the infrastructure has improved. That can have a huge impact on the value of a metal deposit.
Another big change is with grade. A few decades ago, nobody would think about developing a 1 gram per tonne gold occurrence. They were mining multi-gram deposits, so the low-grade prospects were ignored. Today, the average grade of a gold mine is less than 1 g/t. Those cast-off deposits are now becoming mines.
When you put all those factors together, that wealth of historic information is extremely valuable as a starting point for modern exploration.
Fraser: So, someone else has already carried out an exploration program before you start.
Lawrence: In fact, typically several companies have carried out exploration, each with different focus. For example, in the Golden Triangle, the first exploration, in the 1960s and 1970s, was directed at base metals. They ignored gold and silver. In the 1980s, they started looking for gold. There were different waves of explorers, each chasing a particular geological model. There were a lot of discoveries. The BC government has a database of literally thousands of these showings and occurrences right across the province. Known as MinFile, that database is available to the public. Each MinFile data point is referenced back to assessment reports and other documents. One fascinating source of information is the set of reports prepared by teams of mines inspectors in BC in the early 1900s. There were literally hundreds of small mines across the province and each was documented an on annual basis. One passage stands out in my mind: Some guys north of Stewart were chasing a vein that they found at surface, which is how all the discoveries were made in that era. The mines inspector noted that the vein was 20 feet wide, but low grade, only $10 a ton, so the miners focused on a narrow high-grade shoot within the wider vein. In the 1920’s, that $10 represented a half ounce of gold per ton. Today, at that grade, it would rank as one of the highest grade gold mines anywhere.
Fraser: Next time we get together, it would be great to hear how you use all the information you derive from the existing data.
Lawrence: That’s where it really gets fun! I look forward to it.