The Hows of Mineral Exploration: Advancing Toward Discovery

Fraser: Last time we spoke, you described the enormous amount of geological information that has already been collected for many regions and how that information could be “data-mined” as a starting point for exploration.

Tell us how you would conduct an exploration program that goes beyond evaluating the existing information and take us through to the discovery stage.

Lawrence: The most important thing is to start with a region that has the right geology to host large deposits. Remember, as we discussed earlier, the best exit strategy is to sell a discovery to a major. That means the discovery must have scale. The best indicator that a region might host large deposits is that the region has already turned up big discoveries. Once you decide where to focus, the first step is to learn everything you can about the geology of that region. You look carefully at the known deposits, then search for similar geological settings elsewhere in the region.

Let’s look at an example. The Golden Triangle of BC has some of the biggest and some of the highest-grade deposits on the planet. Those deposits are directly related to a series of intrusions, that is, masses of molten rock that came up from deep in the crust. There are many intrusions in this region, but the metal deposits are related to intrusions of a particular age, roughly 180 to 220 million years ago. The deposits are found where there is the right combination of intrusions of that age, particular host rocks and specific structural orientations. We identified an area that had exactly the right setting. It had been explored for decades. At least 50 companies had explored small areas within what we now recognize as being one big geological system. We compiled and re-evaluated all that historic information. We liked what we saw, so we consolidated the property through multiple agreements and staking. Our geological team has now spent a year data-mining, with one field season to verify and expand on the existing data set.

Fraser: That sounds like a good starting point. How do you move it forward?

Lawrence: The ground covers what we call a fertile geological system. There are copper and gold values at surface extending over several square kilometers: multiple g/t gold; up to 17% copper. There is clearly a porphyry system on the western part of the property. The geological evidence suggests this is all peripheral to the core of the system. Seeing values as high as that on surface, and over such a broad area, tells us that there is something there of real significance. The task now is to find the heart of the system, where we expect to find consistent values over extensive intervals.

To put this task into perspective: The area of the Telegraph property is equivalent to the area of Manhattan plus the Bronx. The Eskay deposit, also in the Golden Triangle, was mined by Barrick for 13 years. It produced gold and silver, which at today’s prices was worth $10 billion. The volume of rock mined at Eskay is equivalent to the volume of the Empire State Building. A billion-tonne porphyry deposit, which would rank as a large deposit, would fit into a strip along the south of Central Park for the first six blocks.

Fraser: That’s a vivid and compelling comparison. And, of course, the deposits are buried, making them hard to find.

Lawrence: Yes. Fortunately, these types of deposits leave clues that extend well beyond the deposits. The next step involves geological science which is as sophisticated as in any branch of science. Porphyry deposits and vein deposits are created kilometers beneath the paleo-surface by super-heated water with metals dissolved. Those “hydro-thermal fluids” originated with the intruding magma and travel kilometers away from the intrusion. The metals are dropped out of solution in favorable locations, but the fluids travel much further and alter the rocks that they travel through. In a typical porphyry system, most of the copper and some of the gold is deposited, or more accurately – precipitated, on and around the upper margin of the intrusion. Some of the gold, as well as silver and other metals is carried further out, as the fluids travel along faults. This creates epithermal vein deposits.

In essence, the fluids create alteration halos around the deposits. So, we examine the rocks in the field. We take samples which are tested with sophisticated techniques to determine subtle differences that can tell us, for example, the temperature of formation. The chemistry of the fluids changes with temperature and pressure as the fluids migrate away from the intrusion. So, there are subtle differences in minerals across the system. Minerals which appear identical, even with hand lenses or microscopes, have subtle differences in chemistry that can tell us a lot about where they formed within the hydrothermal system. So, techniques like SWIR (short-wave infrared) analysis are used to detect those subtle differences.

Fraser: So, you look at all those variables and vector toward the heart of the system?

Lawrence: Yes, exactly. But it’s not quite that simple. Often, there has been multiple pulses of intrusion and hydro-thermal activity. Often, the fault that was the pathway for the first pulse of intrusion is sealed by the crystalized magma. Subsequent pulses might re-open that first fault. Or, it might force its way up a separate path. So, the various pulses are not always aligned.

Each successive pulse over-prints the pervious phase. It makes it complicated to interpret. The reality on and under the ground is very different than the neatly coloured cross-sections of idealized alteration halos that some investors have seen.

The good news is that the complex, multi-phase systems generate the best deposits, both in grade and size. Each successive mineralizing pulse adds more metal and moves the earlier metal around, sometimes further concentrating the metal. If conditions are right, you get deposits that are large and high grade. That is certainly the case in the Golden Triangle. The hydrothermal systems were active for exceptionally long periods of time, with multiple pulses. There are other geological factors that created the incredible metal endowment in the Golden Triangle. I would love to talk about that, but we should do that another time.

Fraser: Yes, that would be an interesting topic. Are there other exploration technologies that you use?

Lawrence: Oh yes. There are numerous other approaches. For example, there is a wide range of geophysical techniques. Differences in the magnetic properties or electrical conductivity or capacitance of rocks can be very helpful in understanding the nature of a geological system. Geophysics, in conjunction with geology and other techniques can be very valuable.

Fraser: Are these scientific approaches that you mentioned well established?

Lawrence: Some of the techniques have been around for a long time and are standard practice. At the same time, the science is constantly evolving. For example, we are working with the Geological Survey of Canada on what they call a Targeted Geoscience Initiative. This one, TGI-6, started with a mandate that efforts should be made to source certain “critical metals” within Canada. That research soon recognized that porphyry deposits in the Golden Triangle host several of the critical metals, including rhenium, bismuth, tellurium and the platinum group metals. Conceptually, if you wanted to find a rhenium-rich porphyry, for example, you would look for trace amounts of rhenium in the alteration halo surrounding the main deposit. However, the concentrations of critical metals outside of the deposits are typically below detection levels of conventional analytical methods.

So, the researchers developed advanced analytical methods and detailed microanalysis techniques to detect these elements. One of the findings is that trace concentrations of platinum group elements within different magmatic suites can be used to assess magmatic fertility and they can serve as an exploration vector. The provincial government and the Mineral Deposit Research Unit at the University of British Columbia are also working in a collaborative way with several industry partners, including Mountain Boy.

The point is: this sort of leading-edge science can be extraordinarily valuable in interpreting the results from field work. The cost of one or two drill holes will fund a lot of science. This type of science can really accelerate a project on the path to discovery and enhance the prospects of being successful with the early drilling.

Fraser: Do all the explorers use this level of sophisticated science?

Lawrence: The old-timers “chased the veins”. They started mining where the vein sticks out of the ground and followed it underground. Some exploration companies use a similar approach: simply stepping out from a known occurrence with drill holes. Drilling is expensive. You want to learn everything you possibly can before you start drilling. Some investors find that approach frustrating. They just want to see drilling. Its like rolling the dice to see what happens. Sometimes, management goes along with that approach and they pop holes in the ground and hope for the best. The problem is that if they miss, which has been known to happen once or twice in this business, they have to go back and raise more money from investors. That causes dilution, making it ever harder to get a big gain in the share price.

So, absolutely, you need to drill. But first learn what you can to maximize the prospects for success.

Fraser: What’s next in this fascinating story of mineral exploration?

Lawrence: So, your favorite exploration company has done the science and then they drilled some holes. When they get the results, what do they mean?

Fraser: Sounds great. Look forward to it.