Operational shortcuts during the exploration phase of a mining project’s development can lead to serious problems later in the development phases of a mine, says mining consultancy firm SRK Consulting partner and principal mining engineer Marcin Wertz.

Early exploration work is the foundation on which all future decisions are based, and any errors at this stage can be costly or even impossible to rectify as a project develops.

A deposit’s orebody and its geological setting form the base of a mining project’s value, thereby requiring that stakeholders be provided with “complete confidence” in the results, adds Wertz.

While challenges at a later stage can often be solved with engineering solutions, the value locked in the geology cannot be changed; therefore, exploration work must be carried out in a systematic and professional way, following the highest standards, he says.

A due diligence review of exploration work is one of the best ways of reducing risk, as a review assesses the work that has been done, including how the data was collected and how reliable it is.

“This is important because resource valuation and mine planning depend on this information,” says Wertz, adding that these reviews often cover the same areas as initial feasibility studies because the quality of geological data impacts on almost every aspect of a project.

One of the first areas reviewed in the undertaking of exploration work is how well it complies with mineral reporting standards.

Locally, the South African code for the reporting of exploration results – Mineral Resources and Mineral Reserves, or Samrec – applies, while in Australia, the Joint Ore Reserves Committee, or Jorc, applies.

These codes set minimum standards for public reporting of exploration results and are designed to build confidence among regulators, investors, lenders and stock exchanges.

Compliance with these codes makes it necessary for companies to follow detailed standard operating procedures during exploration. These procedures, in turn, guide the method and quality of exploratory drilling, the way samples are collected and stored, and the controls that ensure the accuracy and reliability of data, explains SRK Consulting principal geologist Alan Page.

“Quality assurance and quality control programmes are an essential part of these processes,” he adds.

Common Problems

However, even with standards in place, Page says common problems still occur, with drillhole spacings related to the level of confidence required being an area where errors are most likely to occur.

For example, coal deposits have strict drill hole spacing requirements under the South African Bureau of Standards 10320:2016.

Drillhole positioning is another area of concern, whereby incorrect drillhole locations can create “serious errors” in geological models, he adds.

SRK Consulting partner, resource geologist and Ghana country manager Ivan Doku recalls a recent case where incorrect drillhole positions were identified during a due diligence review.

“To correct this, our team recommended using light detection and ranging survey to confirm the accuracy of the elevation model.”

Sampling and laboratory analysis are two more areas that need close attention, adds Doku, who notes that the mineral reporting codes aim to prevent problems such as sample loss before laboratory analysis or incorrect labelling that forces samples to be discarded.

If the quantity of material taken from drillholes is too little, the results will not accurately represent the orebody; companies must also ensure that laboratories used for mineralisation testing are accredited and that proper preparation procedures are followed, Page explains.

New Technology

SRK has embraced advanced technologies to improve accuracy and lower costs in minerals exploration, says SRK Consulting principal geologist Nicolaas Steenkamp, adding that such new technology includes satellite image processing to highlight areas that may contain mineralisation.

This approach reduces the need for costly ground-based sampling over large areas, while geophysical imaging helps to design drilling programmes that are more focused and efficient.

In addition, SRK has developed a proprietary AI system to assist in interpreting exploration data, and while AI is used for data-driven insights, all findings are still reviewed by an experienced geologist to ensure that expert knowledge supports the final recommendations, he adds.

Beyond the economics of a project, environmental and social issues are another key focus area during an exploration due diligence, says Doku. Most jurisdictions require some form of environmental authorisation (EA) to be undertaken before exploration can proceed, whereby the impacts of the exploration programme are assessed and requisite stakeholder engagement conducted. Review of the land tenure, EA conditions and stakeholder engagement for an exploration project are therefore critical when undertaking a due diligence.

Public participation processes are important because they help secure the social licence to operate, especially in areas where there is to be significant interfacing with local communities or indigenous land rights concerns, Wertz concludes.