Ever get that lost feeling when geologists start talking about the rocks at your favorite mining project?
Well you are not alone. Truth is there is a whole host of industry insiders, from brokers to office staff at mining companies, from investors to even young geologist, who get that sinking feeling when the term economic geology comes up.
David Groves, Emeritus Professor at the Centre for Exploration Targeting at the University of Western Australia, and mining industry veteran, feels your pain and wants to help. To this end, he has teamed up with MarketMotionMedia and MDRU at University of British Columbia to present a course entitled 'The Geological Framework for the Business of Exploration and Mining on March 1 -2, in Toronto just prior to PDAC
“I taught for 30 years at the University of Western Australia and today there is far less practical training then there was, and there’s less geologic training within the companies themselves,” he says. “Companies used to take on a new recruit and for years would train them and send them to locations around the world. All that seems to have disappeared.”
Groves, who serves as advisor to Canaco Resources (CAN-V), Tigray Resource (TIG-V), Castle Peak Mining (CAP-V), Lago Dourado Minerals (LDM-V) and UltraLithium (ULI-V) in terms of their geological models and regional exploration, will delve into how investors can use geological lessons from academia to make better investment decisions.
The key, he says, is to get a better grasp of the foundational ideas of geology, and how they apply to modern discoveries. And one of the best ways to get that understanding is to look at geology as a hierarchical process.
The process can be pictured as a pyramid, with a global-scale geological perspective forming the base. Next an investor must consider the province-scale geology, followed by a district scale perspective, and only after a project passes successfully through all of those screens, should specific project issues be addressed.
Speaking over-the-phone from Australia, Groves talked to The Northern Miner in greater depth about his ideas.
The Northern Miner: The term “economic geology” is an important one to you, can you define what it means to you.
David Groves: Economic geology is about understanding the evolution of mineral deposits. From an academic point of view you are trying to understand how mineral deposits formed. From an exploration point of view where you are trying to select the critical components of a model, and see how it plays out in an exploration sense.
TNM: What is the state of the industry today, in terms of its overall understanding of economic geology?
DG: Within the industry, apart from professional geologists, there is generally a poor understanding of economic geology, which surprises me. A lot of support staff at mining companies and most investors and brokers have very little sense of economic geology.
Brokers and investors certainly understand the company side. They generally will look at a board or a management team and invest based on their track record, but if you understand economic geology you can really understand if the company is in prospective terrain or not.
You can start to understand if the project is in a country with a record or the potential for ore deposits, and whether or not you are in a province with the right rock age and the right geo chemistry to host a deposit. Very often you see companies working in areas with the wrong type of rock. They are looking for gold in rocks with the wrong age, the wrong tectonic setting or they are in the wrong part of a fault structure.
Understanding geology allows you to discriminate those company with good geology and the once with the chance of making a significant discovery.
TNM: On the global level of the hierarchal pyramid, where do you see the best opportunities for new gold discoveries?
DG: It varies. I think it’s more common for companies to go back to a familiar place that is very mature and has been explored, so the chance for a new discovery is low.
The best opportunity is to go to ground that is immature, in countries that are less well developed and have the right geology.
TNM: What are some features that distinguish between the ‘right’ and a ‘wrong’ geology?
DG: Just as there have been climactic cycles over the Earth’s history in the same way we have tectonic cycles. Cycles of around 500 million years where the Earth goes from a super continent to a dispersion of continents and in certain time periods you get mineralization. If your rock is not in that time slot, your ground will likely not have mineralization.
If you are looking for gold there’s a period called ‘the boring billion’, which is from about 1.8 billion to 700 million years ago where there was virtually no gold. So if you’re searching for lode gold in that age range your chances of finding it are very low.
The ‘golden times’ for gold are 2.7 billion, 2 billion, 1.8 billion, and about 500 million years ago and then a whole series of time periods from 500 to 50 million years ago. The gold causing events become more common as we go forward.
But if you are looking for other metals you would look at different time slots, so the boring billion for gold is actually the golden age for lead zinc with most events occurring in the 1.6 to 1.5 billion range.
TNM: Can you describe how this theory factored into Canaco’s Handeni discovery?
DG: Tanzania is a relatively immature country in terms of mine development so the geology was poorly known. It was only when one of my students dated the rocks through sophisticated rock analysis that we realized the real age of the rocks at Handeni.
Previously those rocks were thought to be 600 to 650 million years old, which isn’t a good period for gold deposits. But as it turned out the rocks are actually 2.7 billion years old, which is the sweet spot for discoveries, it’s just that those older rocks were in terrain with a lot of 600 million year old rocks.
TNM: Based on that thesis where could the next big finds be?
DG: Africa is somewhere that is very important. Liberia was just voted the best exploration destination at the Mines and Money convention in London, because it has Greenstone belts that are similar to those in Canada and Australia. They have rocks that are two ages 2.7 and 2 billion to 1.9 billion years-old. All of the Canadian Archean, from Yellowknife to Timmins are about that age and we see the same thing in Australia, the same thing in Tanzania and the same thing in Brazil.
TNM: What does the rock age in North America tell us about the formation of gold deposits here?
DG: The age is telling you something about the tectonic process at the time, so when Greenstone belts were forming there was a whole lot of terrain that was accreting. You can see this process with the belts down along the west coast of North America as well. They are forming like modern greenstone belts and the reason it is so prospective is it’s the same sort of rock types that were seen in the golden ages.
Now it is also different in many ways, but it is a similar tectonic process. The Mother Lode in southern California was also formed by a similar process. And even today, underneath the San Andres fault, there is probably gold deposits forming. But they won’t be exposed for another 30 million years.
Every time the plates move they are pumping water through the fault zones and it is carrying gold and depositing it at depth. It’s a very similar process to what happened in the Timmins area.
TNM: You have said in the past that making a determination on the Provincial level of the hierarchical pyramid is the key point in the process of finding a deposit. Can you expand on that?
DG: The premise of this is that if a company is not in the right province, with certain age and tectonic setting, they likely won’t be successful.
The opportunity in exploration is to find a province that hasn’t been over explored but has the characteristics of provinces that have been explored successfully.
So to find another Abitibi or Ghanaian belt the real secret to do that is that the people involved in exploration need to have a broad understanding of geology. They have to think on a global scale have global information.
Take press releases for example. If I’m looking at two identical drill results, I would go back and look at the province that the two companies are in and if one has the right geology I would think the results are significant, whereas if the other didn’t I’d be more inclined to think it’s a anomaly and the results won’t be sustained.
TNM: How do you define a province?
DG: The Abitibi belt would be on a province scale. Generally speaking, I think of province scale as being in the thousands of square kilometers, a tectonic unit. The California Mother Lode, The Carlin Trend in Nevada, well that is halfway between province and district. They call it a district but it is a very distinctive geological setting.
So generally speaking, provinces are in the thousands of square kilometers, districts are in the hundreds of square kilometers, camps are in the tens of square kilometers and deposits usually occupy less than a square kilometer.
TNM: What about the possibility that there simply aren’t any big discoveries left to be found?
DG: I think there are big finds to be found.
There are two ways to look at things. There’s lots of poorly known terrain in the world still. A place like Mauritania was on no one's radar, and neither was Liberia. They both popped-up in the last few years because the geology was poorly known previously and then exploration determined they had the right age of rocks. I also think that a lot of what Americans call ‘the Stans’ are extremely prospective.
Then there are the opportunities that Canadian companies have been finding recently. Where they had always been looking for high grade in the Abitibi — because Canadians didn’t traditionally think in terms of open pit the way we Australians do, with our flat terrain and soft rock at surface — now Canadians are discovering large deposit of 1 gram material. Those mineralized bodies have been known about for many years but they hadn’t been thought of in the correct way economically.
So another alternative is not finding new deposits but just understanding that you can mine something you know about in a different way.
The short course being given by David Groves, “Geological Framework for the Business of Exploration and Mining” can be registered for at: http://secure-mdru.sites.olt.ubc.ca/sc73-geolgical-framework-for-the-business-of-exploration-and-mining
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