The copper discovery at Mingomba in Zambia has certainly captured mining headlines over the last few days.
I thought people might be interested in the following 'Mining for Zambia' article (from March 2023) on how KoBold Metals' methods at Mingomba differ from what a 'standard' explorer would do, which I found of interest:
Is this approach different from what conventional explorers do? Yes. Common practice in the industry is to come up with one’s best estimate of the rocks below the surface and their properties. However quantifying one’s uncertainty about what’s underground is not common practice. But by quantifying our uncertainty, we can design exploration programs that most effectively reduce it. This means we can reach a higher confidence level faster and cheaper – enabling us to define resources more quickly and at lower cost.
We’re always trying to quantify our uncertainty. We ask ourselves: What do we know, how do we know it, how precisely do we know it, and how can we test for it? These methods are used to guide each of our exploration decisions.
Does this approach bypass the need for ‘traditional’ mineral exploration methods? No, we undertake the same field activities as traditional explorers. This isn’t a case of simply shoving a bunch of data into a machine and getting a treasure map out! There are many decisions that we have to make throughout an exploration program, such as where in the copper belt to focus, how to select targets for further ground investigation, and how to design surveys. Our objective is to improve each of these decisions by generating rich data quickly. Improvements at every stage of decision-making compound to produce better exploration outcomes in the aggregate.
Tell us a bit about what defining a resource entails at KoBold, and how your methods differ from what a standard explorer would do. Essentially, we make predictions about the nature of the resource in the places we haven’t drilled yet – that could be one metre, ten metres, or 800 metres away from the nearest drill hole. Then we target drill holes in places with the highest uncertainty to most rapidly improve our understanding of what lies below the surface.
Instead of drilling where we already have high confidence in the resource definition, we strategically collect data from areas that will provide the most information, to help us decide where the next hole should go – and the one after that, and so on. It’s a sequential planning exercise. We’re applying techniques rooted in Decision Science – widely used in fields like aviation navigation – to guide our decision-making. We need to consider: How can we get the most information out of this dollar and this time so that we get the best possible understanding of the resource to support the development of a mine in the shortest time frame?
Suppose you design a mine plan for one chunk of resource. In that case, you may discover that the mineralisation is actually much better two kilometres away, and your mine plan is no good anymore. You will have designed a very suboptimal mine because your shaft is in the wrong place. Or, if you’re wrong about the boundaries of the resource, you might miss out on something really valuable. False negatives can be very expensive. That’s one of the reasons that an aggressive exploration program here is so important: we need to know where the deposit’s centre of mass is.
Approximately how long do you anticipate the resource definition phase will take? The ore body at Mingomba is more than 1,200 metres below the surface in most locations, so these are difficult, time-consuming holes to construct. Historically, less than half of the holes drilled on this property succeeded in reaching that target depth. When things go well, it takes three months to construct one hole, and, as you can imagine, it requires dozens of holes to define a resource. So, one hole – essentially one new data point – takes three months of work and, in round numbers, a million [US] dollars.
Note: KoBold Metals bought [for a US$150 million investment] into a joint venture with the existing owners of the project – Australian private equity firm EMR Capital and Zambia’s state-owned mining investment vehicle ZCCM-IH.
Cheers
These are only my thoughts and it does not constitute investment advice. Before acting on any information you read and before making any financial or investment decisions, you should always consult your advisor(s) or other relevant professional experts.
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