australia's identified mineral resources 2005 - Geoscience Australia

AUSTRALIA’S IDENTIFIED MINERAL RESOURCES 2005
Exploration
Expenditure on uranium exploration in Australia declined over two decades leading up to 2003.
From early 2003, market prices for uranium have increased with spot market prices more than
doubling from US$10/lb U 3 O 8 (early 2003) to US$26.25/lb U 3 O 8 in May 2005. This has seen a
resurgence of exploration activity marked by a number of new uranium-focussed junior exploration
companies listing on the Australian Stock Exchange. Uranium exploration expenditure in Australia
increased to $13.96 million in 2004, more than double that for the previous year ($6.38 million).
Currently there are over 20 companies exploring for uranium compared with five actively exploring
in 2003.
In 2004, all uranium exploration was in the Northern Territory and South Australia with the main
areas and deposit types targeted being:
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Arnhem Land (NT) – exploration for unconformity-related deposits in Palaeoproterozoic
metasediments below a thick cover of Kombolgie Sandstone.
Frome Embayment (SA) – exploration for sandstone uranium deposits.
Gawler Craton/Stuart Shelf region (SA) – exploration for hematite breccia complex deposits.
WMC Resources continued a major exploration drilling program at Olympic Dam where significant
additional resources were identified in the south-eastern portion of the deposit. Total resources as at
December 2004 were almost 30% higher than in December 2003.
Heathgate Resources announced the discovery of a new zone of uranium mineralisation approximately
3 km south of the Beverley deposit. Referred to as the Deep South zone, it was found using a range
of geophysical surveys followed up by an extensive drilling program comprising more than 120
holes. The company also reported other discoveries in and around the Beverley mine.
Alliance Resources/Quasar Resources reported that drilling at the Beverley 4 Mile prospect (10 km
northwest of the Beverley mine) along the western margins of the Frome Embayment intersected
uranium mineralisation. Hole AK009 intersected 1.5m at 0.26% eU 3 O 8 from 146m depth. Mineralisation
is within carbonaceous sands thought to be Late Jurassic in age and equivalent to the Algebuckina
Sandstone. If this interpretation is correct, it represents the first known discovery of significant uranium
mineralisation within Mesozoic sediments in South Australia. It also highlights the potential for further
discoveries in these sediments, which underlie extensive regions of the Frome Embayment.
Southern Cross Resources continued exploration drilling to test Tertiary palaeochannel sands in the
southern portion of the Frome Embayment (SA). In 2004, the company discovered a new zone of
low-medium grade uranium mineralisation in an area of the Yarramba palaeochannel, approximately
1.5 km north-west of the Honeymoon deposit. The zone (identified as the Brooks Dam prospect)
has been tested by drilling over 1 km along the palaeochannel. Grades and thicknesses of mineralised
intersections were measured using a down-hole Prompt Fission Neutron probe. This gives more
reliable uranium grades than the gamma-ray probes normally used for measuring grades of
mineralised intersections in this type of sandstone-hosted uranium deposit.
Southern Cross also completed airborne electromagnetic survey and ground gravity surveys over the
Billeroo region and defined the extent of the Billeroo palaeochannel. A program of 117 holes was
completed to evaluate the resources at the Goulds Dam prospect (75 km NW of Honeymoon),
which is within the palaeochannel. Updated resource estimates are expected in 2005.
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Minotaur Resources continued exploration drilling at the Prominent Hill Cu-Au-U deposit, approximately
150 km northwest of Olympic Dam. The geological setting and style of mineralisation are broadly similar
to the Olympic Dam deposit, however, the average uranium grades of drill intersections at Prominent
Hill are 100 ppm U, much lower than for Olympic Dam, which averages 400–500 ppm U.
Production
Australia’s uranium production for 2004 came from its three mines: Ranger open cut (5 138 t U 3 O 8 ),
Olympic Dam underground (4370 t U 3 O 8 ) and Beverley in situ leach (1084 t U 3 O 8 ), a record level of
total production – 10,592 t U 3 O 8 (8982 t U), 19% higher than for 2003. Australia, with approximately