Page 110 - Introduction to Mineral Exploration

5: FROM PROSPECT TO PREFEASIBILITY 93

discovered. Often it is only some factor such Joint venturing is normally carried out by cir-
as the impending deadline on a mineral rights culating prospective partners with brief details
option that will result in a decision to exercise of the project, but this may exclude location
the option or drop this type of prospect. and other sensitive details. Seriously interested
The definition of a potentially economic parties will then be provided with full details
deposit is an altogether more agreeable prob- and the possibility of visiting the prospect to
lem, and the exact ending of the exploration gain a more accurate impression before com-
phase will depend on corporate policy. If a mitting any money.
small company is having to raise money for Buying or re-examining a prospect that a
the evaluation phase, it will probably leave the previous party has discarded is tempting, but
deposit partly open (i.e. certain boundaries the buyer must be satisfied that they can be
undetermined), as a large potential will en- more successful than the other explorer. This
courage investors. Larger companies normally success may result from different exploration
require a better idea of the size, grade, and models or improved techniques.
continuity of a deposit before handing over the
deposit to their pre-development group.
It is usual for a successful program to extend Mulberry Prospect
over several years, resulting in high costs. A good example of this is the exploration of
Exhausting a budget is common; however over- the area on the north side of the St Austell
spending may result in a sharp reprimand Granite in southwestern England, here termed
from accountants and the painful search for Mulberry after the most productive old mine
new employment! (Dines 1956). It was examined by three differ-
ent companies from 1963 to 1982, as reported
in British Geological Survey (BGS) open file re-
5.3 RECYCLING PROSPECTS ports. The Mulberry area is of obvious interest
to companies as it is one of the few in Cornwall
The potential of many prospects is not resolved that supported open pit mining of dissemin-
by the first exploration program and they are ated tin deposits in the nineteenth century
recycled to another company or entrepreneur. and might therefore be more efficiently mined
This recycling has many advantages for the using advances in mining technology. The
explorer. If for some reason the prospect does deposits worked (Fig. 5.16) were the Mulberry
not meet their requirements, they are often open pit with a N–S strike and a series of open
able to recover some of the investment in the pits on the Wheal Prosper structure which runs
prospect with the sale of the option or the data E–W. All the open pits were based on a sheeted
to a new investor. Often it is not an outright vein complex or stockwork of thin veins con-
sale but one in which the seller retains some taining cassiterite, tourmaline, and quartz. In
interest. This is termed a joint venture or farm addition there were a number of small under-
out. Typical agreements are ones in which the ground workings based on E–W copper- and N–
buyer agrees to spend a fixed amount of money S iron-bearing veins. All the deposits are within
over a fixed period of time in order to earn a pre- the metamorphic aureole of the St Austell
agreed equity stake in the prospect. The period Granite, hosted in slate and another metamor-
over which the funding takes place is known as phic rock known locally as calc-flinta. This
the earn-in phase. Normally the seller retains consists of garnet, diopside, actinolite, quartz,
an equity stake in the project and the right and calcite and was probably originally an im-
to regain complete control if the buyer does pure tuff or limestone.
not meet its contractual obligations. The type The initial examination in 1964 resulted
of equity retained by the seller varies; it may in- from a regional appraisal in which Consoli-
clude a duty to fund its share of development dated Gold Fields (CGF) sought bulk mining
costs or it may have no further obligations – a targets that were amenable to improved min-
free or carried interest. The seller may as an ing and processing techniques. CGF immedi-
alternative choose merely to have a royalty if ately identified Mulberry as being of interest
the project is eventually brought to production. and confirmed this by sampling the old open