Page 71 - Introduction to Mineral Exploration

54 C.J. MOON & M.K.G. WHATELEY

and ferrous metals in the early 2000s due to the 2 Sound basis of operations. The organization
initially lower gold price and boom in demand works within corporate guidelines towards
from China. objectives.
After the initial corporate planning, usually 3 Creative and productive atmosphere. The
by senior executives, an exploration strategy group encourages independent creative and
must be chosen, a budget allocated, and desir- innovative thinking in an environment free
able deposit type(s) defined. from bureaucratic disruption.
The choice of exploration strategy varies 4 High standard of performance, integrity, and
considerably between companies and depends ethics.
on the objects of the company and its willing- 5 Entrepreneurial acumen. Innovation is fos-
ness to take risks. For new entrants into a tered in a high risk, high reward environment.
country the choice is between exploration by 6 Morale and team spirit. High morale, enthu-
acquisition of existing prospects or grass roots siasm, and a “can do” attitude.
(i.e. from scratch) exploration. Acquisition 7 The quality of communication is high. The
requires the larger outlay of capital but carries “top brass” are aware of the ideas of geologists.
lower risk and has, potentially, a shorter lead 8 Pre-development group. Successful organiza-
time to production. Acquisitions of potential tions are more likely to have a specialist group
small producers are particularly attractive to responsible for the transition of a deposit from
the smaller company with limited cash flow exploration to development.
from existing production. Potential large pro- All these points make it clear that the
ducers interest larger companies which have management must consist of flexible indi-
the capital necessary to finance a large project. viduals with considerable experience of
This has been particularly marked in the early exploration.
years of the twenty-first century in the con- If these are the optimum characteristics
solidation of the gold industry into a few large of an exploration group, is there an optimum
producers that have devoured the medium size and what structure should it have? Stud-
sized producers. Larger companies tend to ex- ies such as those of Holmes (1977) show that
plore both by acquisition and by grass roots the most effective size is in the range seven
methods and often find that exploration pre- to ten geologists; larger organizations tend to
sence in an area will bring offers of properties become too formalized and bureaucratic, lead-
(“submittals”). Existing producers have the ing to inefficiency, whereas small groups
additional choice of exploring in the immedi- lack the budgets and the manpower to mount
ate vicinity of their mines, where it is likely a successful program. For the large mining
that they will have substantial advantages in group which wishes to remain competitive
cost saving by using existing facilities. Most while spending a large budget, the solution
of the following section refers to grass roots is to divide its explorationists into semi-
exploration, although evaluation of potential autonomous groups.
acquisitions could run in parallel. Exploration groups can be organized on the
basis of geographical location or of deposit
type. The advantage of having deposit special-
4.1.1 Organization
ists is that in-depth expertise is accumulated;
The key to exploration organization is to have however, the more usual arrangement is to
the best available staff and adequate finance in organize by location with geologists in each
order to create confidence throughout the or- region forming specialist subgroups. At the
ganization (Woodall 1984, Sillitoe 1995, 2000). reconnaissance stage most work will be car-
A number of factors that characterize a suc- ried out in offices located in the national head
cessful exploration team have been recognized office or state office, but as exploration focuses
by Snow and Mackenzie (1981), Regan (1971), in more detail smaller district offices can be
and discussed in detail by White (1997). opened. A typical arrangement for a large com-
1 High quality staff and orientation towards pany is shown in Fig. 4.2. In a company with
people. Successful organizations tend to pro- existing production there may be close liaison
vide more in-house training. with mines and engineering divisions.