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On Monday, October 25th, 1971 at approximately 12.15 a.m. the night shift proceeding underground discovered smoke at No.1 and No-3 cut throughs on the eastern side of the belt heading and in close proximity to the upcast shaft. Attempts to control the fire continued throughout the morning; as the position underground altered various procedures were adopted in an effort to contain and control the fire. Despite these efforts at approx. 12.40 p.m. a sudden change occurred which made it necessary to withdraw all workmen from underground, the vicinity of the Tunnel entrances and upcast shaft. Sealing of the mine at the entrances was the only remaining alternative. Several boreholes were put down to enable sampling of the atmosphere and air temperatures to be taken. This was essential as a guide to determining when conditions were suitable to allow exploration of the area using mine rescue self contained breathing apparatus.

Jan 1, 1972

Western Mining Corporation began shaft sinking operations at it's Foster orebody, south of Kambalda, on the 20th June, 1984. The top levels of the orebody are currently being mined via a decline some 1.5km away.Long term plans require the shaft and decline to combine and produce 400,000 tonnes of nickel ore per annum. Eventually all of the ore produced will be hauled up the shaft.The shaft is 4.5m in diameter and the target depth is 760m. Ground conditions to date suggest there will be no further need for concrete lining beyond the oxidised zone. As such, the sink is an open-shaft development in competent basalt rock. Shaft furniture will be installed on completion of the excavation to the target depth.This paper summarises the experience in the project to date, along with comparisons to conventional shaft sinking methods employed in previous years at Kambalda Nickel Operations.

Jan 1, 1985

Two examples of risk assessment and risk management in action are discussed. The first is in a management context in relation to Kingsgate Consolidated LtdÆs Chatree operation in Thailand. Kingsgate has conducted an over-riding risk management program to assess and manage risk across its complete business from the Sydney and Bangkok offices through to the Chatree Mine and the companyÆs exploration group. This example addresses how Kingsgate has applied risk management, particularly to the process operation, and the benefits that have been gained. The second is in an operational context in relation to Minara Resources LtdÆs Murrin Murrin operation in Western Australia. The subject is the methodology and outcomes of a risk assessment across the Murrin Murrin operation specifically to identify and assess risks with potential impacts from $1 M to $7 M. This section of the paper then shows how the outcomes of the risk assessment were integrated into MinaraÆs strategic plan to debottleneck the plant and increase nickel production.

Jan 1, 2004

By A E. C Peres, J D. Donda

With the aim of producing a concentrate with silica content lower than 1.0 per cent SiO2, laboratory experiments were conducted using a sample of the final concentrate from the Samarco iron ore flotation plant (mechanical cells circuit). The sample contained 3.08 per cent SiO2. This sample was split in two size ranges: >105 ¦m and 2. The >105 ¦m fraction, representing 23.3 per cent of the initial mass, was re-ground to 100 per cent 2 content were obtained. Considering the mass proportions of the two size fractions, the calculated silica content of the combined concentrate was 0.68 per cent, which is considered satisfactory for the objective of this investigation. The major reasons for the higher (0.90 per cent) silica content of the concentrate from the coarse fraction are the presence of silicon in the lattice of goethite and the presence of residual silicious slimes in the pores of porous hematite.

Jan 1, 2005

The purpose of this paper is to outline some aspects of the experimental worlr that has been carried out in the mineral dressing laboratory at M'ount. Morgan during recent years.The subject matter has been dealt with under the following headings:1. Comminution of various mill products.2. The application of sulphur dioxide as a flotation reagent.3. Heavy-media separation.4. Bulk flotation of sulphide ores.COMMINUTION OF VARIOUS MILL PRODUCTSThe following data were cbtained by processing fractions of reserve grade ore.Granular TailingIn Table 1 are shown the results of tests on material representative of average grade tailing. In the first test (H1 ) the granular tailing was floated as received and in the second test (Ha) the tailing was ground prior to flotation.

Jan 1, 1952

By N M. Rana, A Take, N Ghahramani, S McDougall, S G. Evans

A critical issue associated with mining operations has been the stability of tailings impoundments. Some breach events have produced catastrophic tailings flows that have caused significant economic damage, mass casualties and long-lasting environmental impact in the downstream environment. This paper reports independently estimated values of runout distance, inundation area and fahrboschung of 16 tailings flows. The adopted methodology involves the geospatial analysis of satellite and aerial imagery to classify each tailings flow into a primary impact zone (Zone 1: main overland flow) and a secondary impact zone (Zone 2: along-creek diluted flow) to characterise runout. Only Zone 1 runout values are reported herein given the greater significance in relation to downstream impact. The fahrboschung is calculated using elevation data from global 30 m digital elevation models (DEMs) and source literature. The results show that all the selected tailings flows travelled long distances (2.4 km to 98.5 km) and inundated large areas (0.35 km2 to 27.0 km2) over very low fahrboschung values (0.04° to 4.8°). This indicates very high flow mobility that is largely governed by the high water content sourced from interstitial waters and, in many cases, supernatant ponds. Scatter plots display poor correlations owing to the complexity and variability in travel path characteristics (confinement, slope angle and obstructions) and the inherent properties of the flowing mass. The slope angle of the travel path exerts a strong control over the flow velocity which has implications on kinetic energy and downstream geomorphological impact. Mean tailings flow velocities may range from ~6 m/s on near-flat, open terrain to over 30 m/s in relatively steeper, channelised travel paths, indicating that tailings flows fall within the extremely rapid and high mobility spectrum of global mass movements. The presented work forms an inceptive part of the CanBreach tailings project, a major component of which is to develop a comprehensive database of case histories to examine the role of geotechnics, failure modes and downstream terrains in influencing tailings flow behaviour.

Jul 1, 2021

By J Player, R de Vries, E Villaescusa, R Hassell

Concerns regarding the uncertainty of stope dilution at MMG Dugald River Underground Mine led to a trial stoping program to acquire full-scale comprehensive geotechnical information and to test the validity of the geotechnical and mining parameters. Given that stope production drilling and blasting is a key parameter that influences dilution a detailed stope blast vibration project was implemented. The stoping trial consisted of 19 stopes, a combination of both sublevel open stoping and longitudinal and transverse stopes, of which five were monitored for blast vibrations.The blast vibration project utilised 20 triaxial geophones and five triaxial accelerometers installed in the hanging wall of five monitored stopes. For each stope fired, full blast waveforms were recorded along with detailed information of the blast design. Analysis of the blast vibrations used the Holmberg-Persson approach, with potential damage determined by the relative (Holmberg-Persson) K values.The project identified the benefit of parallel, breakthrough slot holes in reducing blast vibration damage. The results show that radial rings toeing or stabbing into the stope wall lead to higher vibrational energy yield which contributed to increased overbreak. Hanging wall overbreak, by comparison, with parallel, breakthrough blastholes with 1 m standoff, combined with lower density explosive charging (0.8 EP) and increased delays limited blast vibration damage. A number of ring burdens from 1.4 m to 2.5 m were monitored with no difference in terms of energy yield being identified. Changes to the stope drill and blast design are suggested to better control the large blast vibrations and recommendations from this project have been implemented into future mine design and planning.CITATION:Hassell, R, Villaescusa, E, de Vries, R and Player, J, 2015. Stope blast vibration analysis at Dugald River Underground Mine, in Proceedings 11th International Symposium on Rock Fragmentation by Blasting, pp 221–232 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Aug 24, 2015

By M Stewart

In January 1994, Macraes Mining Company started a new phase of exploration to find additional resources along strike and down dip of identified resources for a mill that was being expanded from 2.1 Mtpa to 3.2 Mtpa. At 30th June 1997 a total of 456,784 m in 3,627 holes had been drilled at the Macraes Gold Project with approximately 325,000 m in 2,100 holes drilled in the latest phase of exploration. This necessitated the construction of resource estimates on a more frequent basis and resulted in the formation of a resource modelling team, assisted by Snowden of Perth. Since April 1995, 14 separate resource estimates have been completed. At Macraes, resource estimates are built using Medsystem/Minesight software. The geological interpretation is converted into a set of three dimensional wireframed solid models which are used to code drillhole composites and blocks in a block model. The interpolation method of indicator kriging is used to interpolate grade into the blocks. Classification into measured, indicated and inferred categories is on the basis of geological confidence and drill spacing. The resource estimate is reconciled against grade control polygonal estimates on a bench by bench basis and on a monthly basis. Grade control estimates are reconciled monthly to mill production. For the period 30 June 1995 to 30 June 1997, the resource estimates have under predicted tonnes by 4% and grade by 1% to under predict ounces by 5% at a 0.5g/t cut off. At ROM sulphide cutoff grade, the models have over predicted tonnes by 5%, under predicted grade by 5% to over predict ounces by 1%.

Jan 1, 1997

By S Kasaneva

TheSan Cristobal gold district is located 110 km east of the port of Antofagasta, Chile. It contains the San Cristobal gold mine, where Niugini Mining Ltd. commenced a heap leach operation, with initial reserves of 10.1 million tonnes grading 1.34 g/t Au, in December, 1990. The San Cristobal district occurs within an upper Cretaceous-lower Tertiary magmatic arc. The main mineralisation occurs within a northwest trending subvertical zone, 1km long and 70 - 100 m wide, which contains rhyolite porphyry and minor breccia, and is locally termed the 'subvolcanic complex'. At the San Cristobal mine, most gold mineralisation occurs in subvertical quartz-pyrite veins which were emplaced in dilational sections of an imbricate fault system. The bulk gold resource comprises four ore shoots which formed where the vein system intersects the subvolcanic complex. Gold-bearing quartz-pyrite veins also occur at separate prospects, the Three Sisters and Sol prospects, west and south of the San Cristobal mine.   Hydrothermal alteration consists of potassic and propylitic assemblages related to intrusion of the subvolcanic complex. This alteration is overprinted by a phyllic stage which is associated with the emplacement of the quartz-pyrite veins. The oxide zone is 180 m thick, and contains native gold, electrum, limonite, and manganocarbonates. The underlying hypogene zone contains pyrite with minor chalcopyrite, sphalerite, galena, covellite, bornite, chalcocite, and arsenopyrite. Fluid inclusion studies indicate that the deposit formed at approximately 270¦C, and the mean salinity of the fluid was 4% NaCl equivalent. These observations enable the San Cristobal deposit to be classed as a porphyry- related, mesothermal quartz-vein system of the low sulphidation type.

Jan 1, 1995

By C Kusi-Manu, E Nyamusika

Geita Gold Mining Limited (GGML) is owned and jointly managed by Ashanti Goldfields Company (Ghana) and Anglogold (South Africa). The mine is currently one of the largest gold producing open pit operations in Africa producing 620 000 ounces of gold and mining in excess of 70 000 000 tonnes of material per annum. The mine currently has 2000 full time employeeÆs and a mine life in excess of 12 years. Geita Gold Mine is comprised of 11 different gold deposits situated in the Lake Victoria Goldfields of North Western Tanzania (Figure 1). The gold deposits are primarily associated with banded ironstone formations within an Archaean greenstone belt. Current global resources, including Inferred, stand at 129.5 million tonnes grading 3.91 g/t (16.2 M oz). Open pit reserves total 70.4 million tonnes grading 4.16 g/t (9.4 M oz). The majority of the gold resource is hosted by the three deposits (Nyankanga, Lone Cone and Geita Hill) within the æGeita TrendÆ a large and continuous (>4 km long) mineralised zone (Adofo, 2002). Geita Gold Mine commenced operations in June 2000, as the second large-scale open pit gold mine in Tanzania. The new workforce of 800 people had no previous experience in open pit gold mining. Since the start of the operation, Geita Gold MineÆs management ambition was to become a world leader in the application of best practice in all technical disciplines and in operational success. Staff development and training was identified as one of the major components in the company achieving its aim. Geita Gold MineÆs management has committed the necessary training staff, resources and the commitment of over $US 1 M a year to staff training and development programs for 2003 and 2004. The process and management of Geita Gold MineÆs mining geology staff training and development program is presented in this paper.

Jan 1, 2003

By Kasaneva S

The San Cristobal gold district is located 110 km east of the port of Antofagasta, Chile. It contains the San Cristobal gold mine, where Niugini Mining Ltd. commenced a heap leach operation, with initial reserves of 10.1 million tonnes grading 1.34 g/t An, in December, 1990. The San Cristobal district occurs within an upper Cretaceous-lower Tertiary magmatic arc. The main mineralisation occurs within a northwest trending subvertical zone, 1km long and 70-100 m wide, which contains rhyolite porphyry and minor breccia, and is locally termed the "subvolcanic complex". At the San Cristobal mine, most gold mineralisation occurs in subvertical quartz-pyrite veins which were emplaced in dilational sections of an imbricate fault system. The bulk gold resource comprises four ore shoots which formed where the vein system intersects the subvolcanic complex. Gold-bearing quartz-pyrite veins also occur at separate prospects, the Three Sisters and Sol prospects, west and south of the San Cristobal mine. Hydrothermal alteration consists of potassic and propylitic assemblages related to intrusion of the subvolcanic complex. This alteration is overprinted by a phyllic stage which is associated with the emplacement of the quartz-pyrite veins. The oxide zone is 180 m thick, and contains native gold, electrum, limonite, and manganocarbonates. The underlying hypogene zone contains pyrite with minor chalcopyrite, sphalerite, galena, covellite, bornite, chalcocite, and arsenopyrite. Fluid inclusion studies indicate that the deposit formed at approximately 270¦ C, and the mean salinity of the fluid was 4% NaCl equivalent. These observations enable the San Cristobal deposit to be classed as a porphyry-related, mesothermal quartz-vein system of the low sulphidation type.

Jan 1, 1995

The achievement of high availability of the Grey River Gold Mining Limited's alluvial gold dredge is a tortuous task which will rely upon the dedication of all staff employed at Grey River Gold Mining Limited (GRGML). The persistent adoption of new technology and better operating procedures, combined with a strong commitment to preventative and predictive maintenance, is necessary. The Grey River Gold Mining Limited alluvial gold dredge is operating in a relatively low grade alluvial gold deposit and hence relies on a high throughput of ore to be profitable. To achieve the required high material throughput the dredge incorporates an overburden removal system which operates simultaneously with a conventional bucketline system.   The overburden system incorporates a cutter wheel and suction pump configuration which is dedicated to removing the low grade (5 mg gold/m3 gravel) overburden. The bucketline conveys the richer grade payzone gravels (up to 890 mg/m3 gravel) to the recovery plant mounted onboard the dredge. The horizon for the overburden system approximates 15 m and the payzone terminates at the interface of the old man rock and the alluvial gravels at a variable depth averaging 22 m.   From a mechanical engineering perspective the dredge is a machine comprised of two materials handling systems which are controlled by Operations Staff and electronic process control systems.   The availability of such a materials handling system is a function of four variables: 1. The environment that the machine operates in. 2. The ability of the people operating the machine. 3. The design of the mechanisms, the configuration that they are grouped in and the effectiveness of the process control systems which control the mechanisms. 4. The procedures utilised to predict the performance of the machines and the skill of staff to analyse that data and carry out effective maintenance.

Jan 1, 1989

By K Ehrig, V Liebezeit, Y Li, B Pewkliang, M Smith, E Macmillan

Pre-concentration of low grade ores via the rejection of low/no value materials based on fragment size is the subject of many published papers and studies over the past decade. However, the possibility of upgrading should not limited to low grade ores given the high cost of capital, energy, water, reagents, and ultimately tailings storage across the mining industry. Mining and processing facilities at Olympic Dam consist of an: 1) underground mine where ore is extracted via sublevel open stoping and 2) integrated processing plant located on the surface which produces Cu-cathode, Au-Ag bullion and uranium oxide concentrate. Blasted ore is trucked/trained to underground crushers which produce an ore feed with a product size P80 = -145 mm. Crushed ore is then hoisted to the surface and delivered to the ROM pads via an overland conveyor. The typical copper grade of mill feed is approximately 2 wt%. A rapid assessment of the potential to upgrade Olympic Dam mill feed prior to the ROM pads via rejection of low value materials based on fragment size was completed using existing data. Three separate datasets were utilised to assess the deportment of Cu, U, Au across size ranges of 200 mm down to sub-8 m. Cumulative grade vs cumulative mass distribution graphs for each element were produced. This data clearly demonstrates that Cu, U, Au grades remain constant down to ~212 m, which happens to be the liberation size of the sulfides. Hence, no potential to upgrade the ore stream via rejection of +200 mm - to ~212 m sized materials prior to milling. Mineralisation within the Olympic Dam Fe-oxide Cu-U-Au-Ag deposit (IOCG) occurs as disseminated sulfide grains within granite- to hematite-rich breccias. The typical sulfide grain size is sub-200 m that supports the outcomes of the grade deportment by fragment size study.

Nov 10, 2020

By B Lance, D O’Brien

The Hidden Secret ore body is located within the Mt Charlotte underground mining system in Kalgoorlie, Western Australia. Mineralisation of the Hidden Secret ore body is lode style and therefore differs from the typical economical mineralisation mined at Mt Charlotte and consequently demanded a novel approach to the mining methodology. The ore body is lens like in shape, extending 200m along strike, 210m vertically, and dipping at 55 degrees. The lode width varies from 1.5m at the extremities to over 22m in the central zone of the ore body. Average grade is 3.4 Au grams per tonne. The initial mining methodology was Modified Avoca utilising Longhole Open Stoping with pillars, in a bottom up stoping sequence. However, as Hidden Secret became better defined and wider than initially modelled, it was identified that a high portion of gold would remain in the pillars and other mining concerns emerged such as remote backfilling large open voids and potentially unsafe vertical standoff distances between levels and wide open stopes. A re-evaluation of this method was undertaken and a new approach adapting a variation of Avoca methodology was identified to remove the rib pillars and replace them with a sill pillar separating the 4 levels into 2 distinct blocks. This new approach provided an immediate advantage by removing the bogger backfilling activity from the same level of the active stope front, enabling stope drilling and prepping to occur during the backfilling cycle. Bogging productivity has also improved as the fired ore is funnelled to the draw point by the backfill rill, significantly reducing the requirement for remote bogging thus improving bogging productivity. This mining method is currently in progress in the first of the two mining blocks and is on track to realise the targeted recovery of 7,700 ounces from the rib pillars.

Mar 15, 2021

By D Maconochie, S Pradhan, M Reed

The Waterview Connection will provide a high-quality strategic alternative to State Highway One and complete Auckland’s Western Ring Route connecting State Highways 20 and 16. The project includes twin three-lane motorway tunnels 2.4 km long and 13.1 m internal diameter (ID). The tunnel construction started in November 2013 using the tenth largest earth pressure balance (EPB) tunnel boring machine (TBM) in the world. The tunnels will pass beneath urban and greenfield areas as well as a major local arterial road. The project is being delivered by an alliance of constructors, designers and the New Zealand Transport Agency. This paper describes some of the key innovative and cost saving design solutions that have been achieved through collaboration in the alliance environment with the construction team, owner’s verifier, the segmental lining precast suballiance and the M&E suballiance for the underground works. The key design elements of the tunnel comprise a three-lane roadway, invert culvert and backfill, precast segmental lining, sixteen mined cross passages including a low point sump cross passage and steel segments for opening to the cross passages. This paper reviews interdisciplinary design integration and the economies achieved in the permanent works tunnel lining design, including reduction in lining thickness and optimising reinforcement, cross passage separation of 150 m, efficient design of the invert culvert and backfill design, main drainage pipe and low point sump. The paper also describes the attributes of the TBM and the invert culvert construction methodology.CITATION:Pradhan, S, Maconochie, D and Reed, M, 2014. Tunnel design in an alliance for Waterview Connection, New Zealand, in Proceedings 15th Australasian Tunnelling Conference 2014 , pp 425–430 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Sep 17, 2014

By Chung S

The problems associated with equating calculated and measured properties of explosives with blast results are examined. The results from six full-scale test blasts in a limestone quarry are described. The purpose of the full-scale trial was two-fold, i) assess the role of varying aluminum levels (10% maximum) in a given explosive in terms of blasting performance, and, ii) find correlation between calculated, as well as measured properties of explosives and the resulting blasting performance. Each blast consisted of 36 holes, initiated with short period detonators in a staggered 3-row 2.4 m x 2.7 m (burden x spacing) pattern. Each 75 mm diameter borehole with no subgrade contained on the average 22 kg of 65 mm diameter cartridged explosive. The bench height was 6.3 m, with an average collpr of 1.2 m. The calculated and mgasured properties of explosive included, strength, detonation and explosion pressure, VOD, plate-dent depth, underwater bubble and shock energy, and the total energy efficiency. Each blast was instrumented to measure detonation velocity, initiation sequence, muck pile motion by means of high-speed photography and blasting vibrations. The post-blast measurements included photogrammetric survey of muck pile for size distribution on surface, muck pile profile, as well as the extent of backbreak. The results showed that the overall blasting performance of the explosive in question was nearly commensurate with the level of aluminum in the explosive, and there was excellent correlation between the underwater test properties and the blast results. The study also exemplified the need for more extensive post-blast analysis than is usual practice, for quantitative assessment of blasting performance of explosives and providing the necessary data-base for calibration of blasting models.

Jan 1, 1990

By McHaina D. M, Hardcastle S. G

A description is given of an investigation into the feasibility of using controlled recirculation of warm exhaust air into the cold intake air of underground mines during winter. Canadian mines can experience inlet air temperatures of minus 30 ¦C and less, requiring them to pre-heat their intake air. The use of controlled recirculation would reduce the inlet air quantity and thus reduce heating costs which exceed $1M on some mines.

Jan 1, 1988

By J Zhou, D M. Hunter, S M. Iveson, K P. Galvin

The recovery and concentration of ultra-fine iron ore can provide significant economic benefits. Presently, there are limited options available given the low settling rates achieved by conventional gravity separation and the relatively poor performance of reverse flotation. The Reflux Classifier is a new water-based gravity separation technology that consists of a set of parallel inclined channels positioned above a vertical fluidised section. This arrangement promotes a powerful throughput advantage compared to conventional fluidisation and a highly selective hydrodynamic basis for achieving sharp separations. A high shear rate develops within the inclined channels, which generates sufficient hydrodynamic lift to convey the lower-density particles (even if they are relatively coarse) to overflow while retaining the high-density particles (even those that are ultra-fine) for discharge to the underflow. The technology has previously been used around the world on particle sizes in excess of 0.1 mm. The present work, however, is concerned with density-based separations down to much finer particle sizes approaching 0.01 mm.A major advantage of the Reflux Classifier technology is the achievement of simultaneous gravity separation and desliming via a single-stage separation. A series of continuous experiments was conducted using an iron ore feed with head grade of 35 wt per cent FeT and nominal top size of 0.106 mm, with 59 wt per cent being below 0.038 mm in size. At a low throughput of 1.5 t/(m2 h), the Reflux Classifier produced high-grade products at a high recovery. For the entire feed, grades of 66.1 wt per cent FeT with Fe recoveries of 80 per cent were achieved in a single-stage separation. Within the 0.020–0.038 mm size fraction, grades of 68.8 per cent were achieved with iron recoveries of 94.7 per cent. Excellent recoveries of up to 57.0 per cent were achieved for the -0.020 mm size fraction. The ability of the inclined channels to retain the fine dense material further enhances the effectiveness of the Reflux Classifier by creating an autogenous dense medium effect within the vertical section. This helps to elevate large gangue particles up into the overflow.CITATION:Hunter, D M, Zhou, J, Iveson, S M and Galvin, K P, 2015. Gravity separation of ultra-fine iron ore in the reflux classifier, in Proceedings Iron Ore 2015, pp 143–148 (The Australasian Institute of Mining and Metallurgy: Melbourne).

Jul 13, 2015

The project is undertaken by Elgas Pty Ltd, a 50 per cent joint venture between AGL and BOC, to store 65 000 t of LPG in underground storage at Port Botany, NSW. The contractor, Concrete Constructions Pty Ltd, elected to use drilling and blasting techniques. The project specification called for the following works to be excavated: Access Shaft:122 m (out of 140 m total depth), 6.0 m diameter (selected by the contractor),Operation Shaft:125 m (out of 150 m total depth), 4.0 m diameter,Water Curtain Gallery:500 m (Later extended by additional 270 m), 4.0 m wide and 3.5 m high,Storage Caverns:910 m, 14.0 m wide, 11.0 m high,Top Heading:14.0 m wide, 5.5 m high,Bench:14.0 m wide, 5.5 m high,Connection Galleries:250 m, 5.5 m wide, 5.5 m high.A total of 156 000 cubm of rock to be excavated.

Jan 1, 1999

By R G. Barker

This paper reviews the annual status of the New Zealand mining industry (metallic minerals and coal) including key aspects such as mineral production, mineral exploration expenditure, commodity price trends, key industry players, market activity and other significant commercial factors.   Strong commodity prices during 2006 have been underpinned by a number of key factors including US dollar weakness and emerging market demand, particularly from countries such as China and India. In real terms commodity prices have recovered significantly since 2002 and are currently at 20-year highs.   New Zealand exploration spending on metallic minerals (predominantly gold) is at a 15 year high driven by rising global commodity prices. New Zealand gold production in 2006 was about 340,000 oz and is expected to grow in 2007 as new mines at Frasers and Globe-Progress (Oceania Gold) and Favona (Newmont) come on stream. Gold production broadly lags 10 years behind exploration spending and exploration activity over the last five years remains well below that seen in the early 1980Æs. Expenditure on coal exploration shows a similar trend with strong growth from a low base over the last five years, reaching over $11 M in 2006. Total coal production in 2006 was 5.9 Mt, an increase of 10% on 2005 with imports from Indonesia adding a further $1.1 Mt.   Newmont and Oceana Gold are by far the largest public gold mining companies operating in New Zealand, although only Oceana Gold maintains a presence on the local stock exchange. Other metals explorers with New Zealand projects include a range of public-listed Juniors (market capitalisation less than NZ$50m) domiciled largely in New Zealand, Australia and/or Canada. Capital-raising on public markets directed towards New Zealand exploration is estimated at around NZ$12 M for 2006, the bulk of this coming via Glass EarthÆs NZ$10 M IPO on the NZAX in October.   The New Zealand Coal sector is dominated by the state-owned enterprise Solid Energy with around 80% market share by production. Other domestic coal competition remains limited, and includes the L&M Group, Pike River Coal, Eastern Corporation, and New Vale (acquired by Solid Energy in 2007). Pricing parity comes mainly from imported coal and global thermal coal prices have remained strong during 2006 at around US$45-55/t, driven by continued expansion in Chinese demand. Coking coal prices have eased 16% since 2005 to around US$98/t in 2007.   Although recent increases in exploration spending suggest a renaissance in the New Zealand minerals sector, long-run trends indicate that we have simply rebounded from a low base over the last five years and much work is still to be done to stimulate further growth in the mining industry to maintain minerals production at current levels. Key industry challenges include marketing exploration opportunities to local and overseas investors, building a critical mass of NZX-listed explorers and providing an internationally competitive environment to attract further capital and expertise.

Jan 1, 2007