The latest geoscience technology can give teams a clearer, more detailed view of what lies under the ground than ever before. They’ll need it if they are to replace depleting reserves without pushing exploration budgets deep into the red.
The richer the insights you draw from your data, and the easier your experts can collaborate over them, the sharper your interpretation of a potential deposit will be, and the fewer holes you need to drill to confirm it.
Further, faster, deeper… While that might sound like the catchphrase of a Marvel movie superhero, those three words are very much the hard reality of where mineral exploration finds itself in 2021.
As existing brownfield sites are steadily exhausted, and greenfield exploration becomes increasingly important, mining companies have to work harder than ever for each new discovery.
For example, despite substantial exploration investment, the last decade has only seen around 25 new major gold deposit discoveries, while ten a year was not uncommon before 2010. Those 25 discoveries, notes S&P Global, make up only 7% of all the gold discovered since 1990.
Fresh finds may be in remote and difficult to access areas, presenting a range of logistical problems. They are likely to sit deeper underground, be less obvious, and so require more intense and perceptive analysis to reveal their worth. Environmental, geopolitical and social licence issues all add to the complexity, and traditional exploration techniques find it hard to rise to these 21st century challenges. Exploration, now more than ever, is a tough business fraught with uncertainty and financial risk.
Yet perhaps against expectations, the thirst and finance for it in the last 12 months has barely diminished, even in the face of the Covid-19 pandemic. At the end of 2020, S&P Global noted that US exploration had declined by just 1.5% YOY. To take one high level example, Newmont Corp’s exploration budget was $268m, and nearly all of that earmarked for gold. And vast as that is, it’s still behind the more diversified Rio Tinto’s world-leading figure of $449m.
So the investment is there. However, finding a way to balance the requirement for exploration with the financial risks associated with the challenges of today’s ore deposits perplexes many a mining company board. The lines charting exploration spend against new deposits found are diverging; the former going up, the latter down.
Meanwhile, the industry grows no less competitive. The ability to explore in an agile manner can be critical to success. That success will rely just as much on failing fast, and quickly deciding which projects are not worth pursing, as it does on spotting the most promising deposits before the bidding wars begin.
Using technology to make exploration more agile
So, for today’s exploration teams to strike gold, quite literally, they need to understand the physics of the earth beneath their feet more clearly than at any period in the industry’s history. At the same time those feet will be far smaller in number. Covid-19 has forced companies’ hands into sending fewer experts into the field, while relying on more to do their work from home.
This pincer movement of events has thrown a greater focus on the role of technology, integrated software and the Cloud to help companies achieve the agile and accelerated exploration they are looking for.
The richer the insights you draw from your data, and the easier your experts can collaborate over them, the sharper your interpretation of a potential deposit will be, and the fewer holes you need to drill to confirm it. (And let’s remember, drilling still chews up a substantial proportion of every exploration budget.) The faster and more efficiently you can build a conceptual model, the more rapidly you can iterate it as fresh data comes in. That enables exploration teams to create multiple scenarios speedily, even in the elusive ‘real time’, and make a confident call from the variety of best options. (And sometimes that call will be, ‘it’s a bust, let’s get out now before we waste more money.’)
Attitudes to the Cloud are changing fast
As an integrated geosciences technology company, we’ve seen just how rapidly this situation is changing. Many mining customers we spoke to 18 months ago still had reservations about the Cloud, specifically its security, and were nervous about trusting it with the crown jewels of their exploration data. Speak to them today and there’s a greater readiness to embrace digital transformation and the collaborative potential of the Cloud if they are to reinvent their exploration strategy in response to 2021’s challenges.
In fact, the idea of drilling, taking photographs of the core, logging that remotely in an office or at home and then making decisions in a collaborative cloud environment is quickly becoming the norm (even within an industry that is not always known as a fast adopter…)
Seequent’s tools for accelerated exploration
The power of Seequent products such as Oasis montaj, Leapfrog and MX Deposit to lay bare the earth’s potential and united scattered teams around it is significant. Without such steps, exploration runs the risk of falling back on scientific guesswork, and however expert that guesswork may be, it’s no match for the growing complexities of exploration today.
Being able to interpret, with conviction, what’s going on under the surface without sinking endless drill holes can solve many of exploration’s current problems. The capacity to render all the data as easily understood 3D visualisation is equally as important, as it can help build shareholder confidence, or convince joint venture partners that you know what you’re doing and where you’re looking.
Ultimately our tools allow people to get more from their data and make smarter, better decisions – at a time when exploration needs both clarity and agility to discover faster and more economically.
- KITCO news, May 14, 2020, Discovery Numbers Dive
- S&P Global Market Intelligence, November 18, 2020, Metals and Mining Research – Exploration Budgets
- S&P Global Market Intelligence, November 12, 2020, Metals and Mining Research – Newmont