Exploration and Discovery Challenges for Copper in SA

Steve Hill and Richard Hillis SA Copper Summit Adelaide Convention Centre Wednesday 6 May 2015

Key Take-Homes from CRU Copper Conference, Santiago, April 2015 • oversupply in near-medium term (until ~2016-2017), undersupply in longer-term:

how bearish in near-medium and how bullish in longer-term varies with analysts • uncommitted projects needed by end of decade to meet supply shortfall • only ~top quartile of new brown- and greenfield projects hit $US 6,000/tonne • grades and impurities are a growing concern • declining productivity is a global challenge, driven in Chile by declining grades increased workforce/tonne

• offset in Chile by increase in processing capacity

To Grow Copper Production, SA Must Provide Best Return on $ Via • technological innovation including exploration addressing grades • other aspects of multifactor productivity (e.g. labour, capital, power & water)

Productivity Challenge

Source: EY ‘Productivity in Mining’, 2014

Productivity Challenge

Source: Topp et al., 2008

The Exploration and Discovery Challenges for Copper in South Australia Steve Hill

Director, Geological Survey of South Australia

South Australia Copper Summit, June 2015

EXPLORATION AND DISCOVERY The strength of the mining industry is sustained through new discoveries. If you don’t have discoveries then you don’t have mines.

Geoffrey Blainey AC August 2013

Emerging efficiencies in drilling, real-time analysis and targeting / mapping mineral systems provide the opportunity for South Australia to lead the world in uncovering high grade discoveries

Moon Plain, Stuart Shelf, SA (Photo S.Hill)

The DISCOVERY challenge… The covered minerals search space across 80% of South Australia!

Government / Private Drivers of Discovery (“The Magna Carter”)

Land Access

Human & Intellectual Capital Education and training R&D – new exploration and processing technologies

Precompetitive Geoscientific Data and Information

Capture and Delivery Value-add Research Underexplored / Covered Regions Targeted Programs

Discovery

Quality of Exploration

Quantity of Exploration

Geos

cienc

e Aus

tralia

; CSI

RO, U

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; SAC

OME;

GSS

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Availability of Finance

GREENFIELDS

Adapted from Derek Carter

Collaboration is key! • PACE • Industry collaboration • Best researchers and associated geoscience and technology

(e.g. Universities, CSIRO, DET CRC, Service Providers) • National partnerships (e.g. Australia Minerals, Geoscience Australia,

NSWGS, NT) • International partnerships (e.g. Sernageomin (Chile), Saskatchewan GS,

China GS, China National Nuclear Corporation)

New Copper Discoveries in South Australia 1. TARGET: Cu Mineral Systems

– IOCG(±U) – Magmatic Cu-Ni-PGE – Volcanic / Porphyry / VMS – Epithermal – Stratabound, SedEx, Sediment hosted (stratiform)…

2. SEARCH SPACE: Scale Reduction – Mineral Province / Regional – Regional to Camp – Camp to Deposit

Themes during scale reduction exploration

From UNCOVER Roadmap

REGIONAL: New Copper (Cu-Ni-PGE) Province in Western Gawler Craton / ‘Coompana’ (TMI backdrop)

‘Coompana’ Fowler Domain

Gawler Ranges

Deep crustal seismic line

(GA, AusScope GSWA, GSSA)

SA’s largest airborne magnetics /

radiometrics survey • 249,000 km survey data • Tender awarded to GPX

Surveys

Regional Magnetotellurics 50 km AusLAMP grid

Regional Plant Biogeochemistry Colin Dunn & Helen Waldron

Towards Regional drilling! • <6 basement penetrating holes

in western half of State! • Recent regional drilling under

Eucla Basin in WA reached basement within 400m

Camp to Deposit: Towards New Deposits in SA

• Mapping & understanding alteration, differentiating mineralisation styles, vectors in Olympic Domain

• Through • Spectral scanning (inc 20 km

HyLogger beneath OD!) • Multi-element geochemistry • Petrophysics • Geophysical data

reinterpretation

WUDINNA KIMBA WHYALLA

PORT AUGUSTA Paris Menninnie

Dam

Iron Duke

Uno

PORT LINCOLN

Minotaur Exploration

Kingston Resources

REGIONAL TO CAMP -Uno Province / Southern GRV margins

1590 Ma Gawler Range Volcanics cover

Regional Mineral System Drilling From $2 M PACE Frontiers fund into > $7 M program!

Geological Mapping and

Geochronology AusLAMP

Magnetotellurics grid (~50 km)

Regional Metallogenic

Studies

Regional Geochemistry and Mineralogy (esp.

open file drill samples)

A 1590 Ma crustal section for South Australia?

Coiled Tubing Drill Rig

Autonomous Sonde

Lab-at-RigTM

New Eastern Gawler Craton Solid Geology

• 6144 drillholes (2558 of them targeting IOCGs) From: Tom Wise, GSSA 2015 SAREIC Presentation

Increased Efficiency towards High Grade Discoveries…

Efficiency and Value Proposition To drill 130,000m on 10km x 10km grid through cover for basement and/or unconformity sample at $50/m: $6.5M (excluding where basement > 1km depth)

Disclaimer The information contained in this presentation has been compiled by the Department of State Development and originates from a variety of sources. Although all reasonable care has been taken in the preparation and compilation of the information, it has been provided in good faith for general information only and does not purport to be professional advice. No warranty, express or implied, is given as to the completeness, correctness, accuracy, reliability or currency of the materials. The Department of State Development and the Crown in the right of the State of South Australia does not accept responsibility for and will not be held liable to any recipient of the information for any loss or damage however caused (including negligence) which may be directly or indirectly suffered as a consequence of use of these materials. The Department of State Development reserves the right to update, amend or supplement the information from time to time at its discretion.

www.statedevelopment.sa.gov.au