Miners must focus on new exploration frontiers to secure supplies: Mines & Money

Miners need to focus on new exploration frontiers if they are to secure sufficient mineral resources for metals-intensive energy transition, said participants at the Resourcing Tomorrow conference, formerly known as Mines and Money, in London Nov. 30.

Pakistan, Saudi Arabia, sub-Saharan Africa, Myanmar and parts of Australia were highlighted as offering as yet untapped mineral resources. A director of the European Space Resources Innovation Centre spoke of the importance of mining on the moon: not to bring mineral resources back to use on earth but to find resources that can be processed in situ to enable humans to survive for periods on the moon, and probably, in future, on Mars.

No discussion was on the agenda this year on deepsea or underwater mining, now largely out of favor with the mining investment community due to potentially serious Environmental, Social and Governance repercussions.

"Pakistan is part of the Tethyan metalliferous belt, which I consider the new Andes," said Barrick Gold Corp CEO Mark Bristow in a keynote speech, noting the Pakistan government had been "very engaging" in negotiation of a two-year framework agreement for establishment of a joint venture mining project. Many and varied mineral resources are on the surface in the Tethyan belt, he said.

By comparison, Chile, one of the world's biggest copper producers, is now an expensive place to mine, with high geopolitical risk and where copper reserves are now deep down, Bristow said.

Both Chile and Peru's copper mining industries have in recent times suffered strike action and investor uncertainties due to changes, either actual or proposed, to the countries' mining codes.

Risks associated with greenfield exploration have meant this has fallen in recent years mainly to junior miners, who are finding it increasingly difficult to gain financing, resulting in insufficient levels of exploration.

Underinvestment has meant that from 180 new gold discoveries during the 1990s, the number of discoveries fell to just 44 during the 2010s, Bristow said. Copper developers have stuck to the largely mature western seaboard of Latin America where there's recently been both geopolitical risk and exploration risk in the Andes, he said.

The consequence is that the discovery rate of copper deposits has also fallen sharply amid risk aversion, promising a shortfall over the next 15 years of the red metal, which Bristow considers possibly the most important of critical metals.

"As explorers we need to go to new places and think differently," he said.

Bristow also saw a "huge opportunity" to participate in mining in Saudi Arabia, where Barrick has just appointed a country manager at its joint venture copper and gold Jabal Sayid mine. The mineral-rich Arabian Shield is "very underexplored and we have the same geology in Egypt, which is also underexplored," he said.

Subsaharan Africa is another area where mining business may be done, he said.

"The mining industry needs to urgently sharpen its focus on exploration... and take bold capital decisions to invest in those high-potential domains where the big discoveries are waiting to be made, " Bristow said. In this way miners may also contribute to the economic development of such areas, and a more sustainable world, he noted.

Government incentives

Michael Naylor, CEO of EV Metals Group, said global markets don't yet appreciate the Kingdom of Saudi Arabia's potential for mineral development and creation of critical raw materials supply chains, backed by "petrocapital". The Saudi Vision 2030 plan is a crucial development roadmap, according to Naylor.

By contrast "western governments don't have a [critical resources] plan," Naylor said on the sidelines of the event.

Industry, governments and global private capital need to collaborate to finance the energy transition, with governments offering incentives, such as EV Metals has gained for its lithium chemicals complex project now being developed in Saudi Arabia, Naylor said.

Andrew Heap, chief of minerals, energy and groundwater division at Geoscience Australia, a government entity, said that new mining frontiers still exist in Australia. The country's new government has earmarked A$50.5 million ($34.26 million) over the next four years to support critical minerals r & d and help open up underexplored areas of the country.

Australia is rich in lithium and global lithium demand is set to increase 15-fold by 2040, driven by a 40-fold increase in demand for electric vehicles and battery storage, Heap said.

Kathryn Hadler, director of the European Space Resources Innovation Centre, or Esric, supported by entities including the European Space Agency, said it is seeking partnerships for resources development to take place on the moon, to support human existence there..

This will for instance involve producing oxygen via hydrogen reduction of ilmenite, which is found on the surface of the moon, she said, adding that water-ice at the lunar poles may also be used. One metric ton of oxygen is sufficient to support two astronauts on the moon for one year, she said.

"But we're starting from nothing," Hadler said. "This requires a community effort."