‘Exploring the unexplored’ may sound like the tagline from an award-winning sci-fi epic, but there is nothing fictional about it in the realm of mining.

Greenfield discoveries are an integral part of the mining cycle and create a domino effect in contributing to long- term economic stability.

Taking this into account, the Western Australian Government’s Exploration Incentive Scheme has been paving the way for exploration in unexplored areas since its inception in 2009.

Speaking to National Mining Chronicle, Minister for Mines and Petroleum Bill Johnston MLA said the EIS was a crucial thread in the WA economy.

“These discoveries help to boost the economy, increase knowledge of our state’s geology and resources and create hundreds of jobs for Western Australians,” he said.

An independent EIS economic impact study undertaken by ACIL Allen Consulting in 2015 revealed the scheme’s major contribution to the WA’s wealth, stating it provided approximately 22 per cent of general government revenue. Beginning last July, the EIS will be funded at an ongoing basis of $10 million per year using funds raised through mining tenement rents.

According to the Department of Mines, Industry Regulation and Safety (DMIRS), the EIS’ main aim is to stimulate increased private sector resource exploration leading to new mineral and energy discoveries.

Mr Johnston said since commencing almost a decade ago, the EIS had helped initiate a number of major resource discoveries across WA, including the Gruyere gold mine.

“WA has a long and complex geological history going back nearly to the formation of Earth,” he said.

“Within this evolution, many and varied mineral and petroleum systems have formed.

“By combining data collected by the Geological Survey of Western Australia, Geoscience Australia, universities, research institutes and industry, we can develop a more holistic picture of the state’s mineralisation.

“These datasets have allowed us to understand the evolution of WA, including what are now recognised as re-worked proterozoic margins to our older, well-endowed archean cratons.”

According to the study, the value of mineral deposits discovered through exploration was multiple times greater than the money spent to find them. It showed for every $1 million invested in the EIS, the net benefit to WA was expected to be $23.7 million.

The 2018 Annual Survey of Mining Companies released by the Fraser Institute further proved the positive impact of the EIS.

The survey saw WA ranked as the fifth most attractive jurisdiction for mining investment, behind Finland, Saskatchewan, Nevada and Ireland. It was also the highest-ranked Australian location, followed by Queensland (12th) and South Australia (14th).

Mr Johnston said remote desert regions in WA were proving important for gold and base metals projects, which included Newcrest Mining’s Telfer gold-copper mines in the Great Sandy Desert and Independence Group’s projects, with the miner having identified an emerging frontier for base metals following its copper-zinc discovery at Andromeda.

Rio Tinto’s recent spend on greenfield exploration in the Paterson region has further exemplified the impact of the EIS, spurring rumours of a prime copper discovery.

“Hundreds of jobs have been created through increased activity in the sector by drilling companies and geophysical surveys,” Mr Johnston said. “This has a flow-on effect on construction and operational jobs.”

One key example is Independence Group’s Nova Bollinger discovery, which was discovered with EIS assistance. The mine now employs around 460 staff.

“Many remote sites also provide opportunities for Aboriginal employment, as seen at the new Northern Minerals’ Browns Range heavy rare earth project in the Kimberley region,” Mr Johnston said.

“Paterson Range is another area where there has been considerable EIS funding, helping companies such as Sipa Resources, Antipa Minerals and Encounter Resources explore copper-gold potentials and develop deposits that are critical for battery minerals.”

Another recent EIS success includes Bellevue Gold’s gold lode north of Leinster. The explorer discovered a bonanza-grade zone of more than 120m at a maximum 85.9g per tonne gold following a diamond core campaign at the Viago lode within its flagship Bellevue Gold project. One of the most reputable, high-grade mines of the 1980s and 1990s, the mine produced about 800,000 ounces at grades of up to 15g per tonne before it was shut in 1997.

Following Bellevue’s acquisition of the project in 2017, the mine’s rich legacy was brought back to life when the company conducted the first systematic exploration at the property in over 20 years. Bellevue has a maiden resource of 1.9 million tonnes at 8.2 grams per tonne for 580,000 ounces at time of writing.

Association of Mining and Exploration Companies Chief Executive Officer Warren Pearce said without the EIS, less greenfield exploration programs would exist, and exploration goals coming from companies would tend to focus on areas where they could support investment around known finds.

“It’s an opportunity now to look at areas that have been unexplored, perhaps in new regions, but also to look deeper, to make those new mineral discoveries that are under cover,” he said.

“You’ve got a number of significant discoveries that have advanced to significant mines, so our view is the EIS, which is a very small investment by the state, actually has a big impact on the economy, and indeed the growth of our regional sector.”

Looking Forward

Poised to support exploration for gold, base metals, petroleum, nickel, lithium, rare earth elements, potash and diamonds, Mr Johnston announced last November the successful applicants for Round 18 of the popular EIS co-funded drilling program, which is providing $5.3 million to 40 projects to be drilled in 2019. This round attracted an increase of 16 per cent on the previous one, suggesting a rise in exploration activity in WA.

“What the EIS scheme does is put up matching state dollars, and that allows companies to then go out and use that to actually bring in some private investment to support it. That’s what makes this scheme work,” Mr Pearce said.

Mr Johnston said accurate data provided better investment confidence and contributed to economic and employment opportunities.

“The industry is taking a more measured approach to exploration and development,” he said. “It is using more precompetitive data to refine targeting, increasing the chance of discovery and being smarter with project investment.

“With around 80 per cent of rocks with potential mineralisation under cover, the EIS will open a greatly expanded search space and pave the way for more efficient targeting methods and safer and environmentally-friendly drilling techniques.

“Alongside the $5-million-a-year EIS co-funded government–industry drilling program, an additional $5 million will concentrate on the acquisition and interpretation of precompetitive geoscience data.

“This will include geophysical survey data integrated with analyses of sample material, much of it obtained from historic drillcores kept in the GSWA core libraries.”

Figures released by the Australian Bureau of Statistics for Australian mineral exploration in the September 2018 quarter revealed that, compared with the previous quarter, metres drilled nationally for mineral exploration rose six per cent, with greenfield exploration rising 7.2 per cent, and brownfields 5.8 per cent. Greenfield mineral exploration expenditure was up 13 per cent – or $25.7 million – to $223.6 million in the quarter.

Mr Pearce predicted the next few years would be positive for the resources sector of Western Australia.

“It’s hard to deny we are going through a particularly good period,” he said.

“There is still a little uncertainty – the investment field here has been a little light on for the last six months. We are hoping that will recover over the next six months. We will see those private investors continue to invest in the sector on the back of recent discoveries in WA, particularly in the Pilbara.

“I am expecting we will see a range of new mine projects announced, as well as expansion projects from existing mines. I think you’ve got a very strong resource sector resurgence to take place over the next two to three years.”