Brownfields are where money is at, director says.

• Author: Louiseize, Kelly
• Position: Harold Gibson

Worldwide shortages of high-quality big ore reserves have put companies behind the eight ball as they scramble to find new deposits.

The question remains, where are they likely to find them?

Brownfields or lands occupied in or around existing mines stand a better chance of revealing new economic deposits, since there are already proven quality ore reserves in the vicinity, says Laurentian University's Mineral Exploration Research Centre director Harold Gibson.

The Sudbury Basin is a good example of brownfields and over the years new discoveries, such as the footwall deposit at Nickel Rim, have built up geologist's expertise.

"It turns out this is where the money makers really are and a lot of knowledge is being developed pertaining to how to explore for them," says partner Gerald Riverin vice-president of Cogitore Resources in Rouyn-Noranda, Que. says.

If the old rule of 20 per cent of the deposits worldwide are producing 80 per cent of the metal that exists, then more large high-grade deposits need to be found, and soon.

"We haven't yet found another Sudbury or Norilsk, Russia" Gibson says, "and the reason we need more is because of the growth in some markets (like China and India)."

At some point researchers will have drilled brownfields to exhaustion. This drives companies to greenfields to make up the difference in production. Greenfields refer to lands where no known production or previous infrastructure has been established. The risk in greenfields is higher, so therefore the returns have to be greater.

This means the cost of developing mine infrastructure, adhering to social-political policies, as well as environmental protocols are high and so the company requires large high-grade deposits to make it worth their while, Gibson says. Companies can spend a lot of time in greenfields and not find anything substantial.

Yet, to be without greenfield exploration projects is to be without a company future, for greenfields will become the brownfields of tomorrow.

"This ensures growth and survival," Gibson says.

But there are other factors at play in mine development. Even if a giant deposit is found like Mongolia's Oyu Tologoi where some 21 million ounces of gold and 17 million tons of copper lay, production can be foiled, in this case, by new legislative policy.

The Mongolian government recently legislated a 64-per-cent windfall tax on certain profit levels. Although some levels of government are lobbying to get rid of the bill, it appears...