PT.

International Nickel Indonesia

Mine Department (19) -  2800

MEMORANDUM
To: Date:
ALL GEOLOGISTS APRIL 22, 2002
Copy:
Y.E. PEREZ; K. ANDRAWINA; A. CARUSO; H. WHITE;
C. DOYLE; L.B. COCHRANE; M. ANDERSON
From: Our Ref. No.:
W. AHMAD
Subject:
COMPUTATION OF PERCENT OLIVINE
BASED ON LOI CONTENT AND S/M RATIO

Currently, MGX is analysing the bottom rocky metre of all core holes and the coarse
fraction from all test pits for LOI content. These samples are also analysed for our
standard 5-element chemistry that includes Ni, Fe, Co, SiO 2 and MgO. In the
absence of limonite/goethite in the samples, LOI content reflects essentially the
water of crystallisation present in the serpentine 1. Theoretical LOI content of
serpentine is 13%. LOI contents lower than 13% represent less than 100%
serpentine in the rock.

Chris Doyle has developed a triangular plot based on LOI content and S/M ratio in
the rocky fraction (Figure-1). The plot utilises the varying S/M ratio along the X-axis
and the varying LOI content along the Y-axis. The plot assumes that average
pyroxenes in our rocks are a combination of orthopyroxene (opx) and clino-
pyroxenes (cpx) in a 2:1 proportion. The exact quantity of clinopyroxene cannot be
determined without CaO analyses, which are currently not available on a routine
basis. Thus, until such time that CaO analysis is available, we will continue to
assume that opx and cpx are present in 2:1 proportion.

The triangular plot also assumes that all silica in the sample is in the form of
ferromagnesian silicates (olivine, pyroxene and serpentine). In reality, however,
some free silica is frequently present. For the time being, we will ignore the
presence of free silica. At a later date, we will try to see if normative computations of
olivine, pyroxene and serpentine can overcome the problem of free silica.

Up until now, MGX has been preparing maps of sampled areas showing LOI
content. While very high LOI contents clearly indicate smeltable rock and very low
LOI contents clearly indicate unsmeltable rock, some intermediate values of LOI are
difficult to interpret without also looking at the silica to magnesia ratio of the
samples. Thus, an LOI content of say 4-5% indicates unsmeltable rock at low S/M
ratio but easily smeltable rock at high S/M ratios. Since both serpentine and

1
Serpentine is a hydrated magnesian silicate that develops as a result of hydrothermal alteration of
olivine and pyroxene.
PT. International Nickel Indonesia (Soroako)
Mine Department (DP. 19)  2800

MEMORANDUM - Page 2

pyroxene are easily smelted in the electric furnace, we should be considering only
that component which causes a problem in smelting, which is olivine.

Using the theoretical relationships among Olivine, LOI and S/M ratio on the
triangular plot, Michael Anderson has developed a polynomial function that can
compute the percentage olivine present in the rocky fraction based on the LOI
content and the S/M ratio of the sample.

Starting immediately, MGX will begin to compute the olivine content of all samples
for which LOI data is available. To avoid the undue influence of limonite/goethite,
such computations should be carried out only upon samples that contain say less
than 10% Fe. The following formula is to be used for the estimation of percentage
olivine. The variables L and S in the formula stand for LOI and S/M ratio
respectively:

% Olivine = (-7.81592 * L) + (-0.01684 * L 2) + (-0.0001 * L3) +

(-406.704 * S) + (196.5419 * S2) + (-37.134 * S3) +
(3.712275 * L * S) + (0.018544 * L 2 * S) + (-1.36932 * L * S2) +
321.5459

The above polynomial function is quite accurate and shows a maximum discrepancy
of less than 2% (absolute) for only a few data sets.

At the conclusion of core drilling and test pitting in an area, MGX will put out routine
reports that would now also include:

 A triangular plot of all rocky samples with available LOI data

 A contoured map of the area in terms of olivine content. The map
should be contoured with following values of olivine:
o < 15% olivine(currently believed to be smeltable)
o 15 – 25% olivine (may be smeltable)
o 25 – 40% olivine (may not be smeltable)
o > 40% olivine(currently believed to be unsmeltable)

The inclusion of triangular plots and olivine contour maps should now become
standard inclusions in the data package prepared for each sampled area.

2
PT. International Nickel Indonesia (Soroako)
Mine Department (DP. 19)  2800

MEMORANDUM - Page 3

FIGURE-1
THEORETICAL RELATIONSHIPS AMONG
OLIVINE, LOI AND S/M RATIO
15
14 Serpentine
13 Orthopyroxene S/M = 1.7
10 Clinopyroxene S/M = 3.1
12
% Loss on Ignition in Coarse Fraction

90
11 20
80
10 30
70
9 % Serpentine
40
8 60
% Olivine

7 50 Current limit
50 of
6 60 acceptable
40 olivine
5
70 30 content = 15%
4
3 80 20
2 90 10
1
0
0.6 0.7 0.8 0.9 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.0 2.1 2.2 2.3 2.4 2.5 2.6
Olivine
SiO2/MgO in Coarse Fraction 2 Orthopyroxene:1 Clinopyroxene

3
PT. International Nickel Indonesia (Soroako)
Mine Department (DP. 19)  2800

MEMORANDUM - Page 4

TABLE-1:
COMPUTATION OF %OLIVINE
BASED ON LOI CONTENT AND S/M RATIO

Calculated values of %Olivine are based on the following polynomial function

where L=%LOI and S=S/M ratio:

%Olivine = (-7.81592 * L) + (-0.01684 * L^2) + (-0.0001 * L^3) +

(-406.704 * S) + (196.5419 * S^2) + (-37.134 * S^3) +
(3.712275 * L * S) + (0.018544 * L^2 * S) + (-1.36932 * L * S^2) +
321.5459

Actual Data from Triangular Plot Olivine Calculated by Difference

% Olivine LOI (L) S/M ratio (S) Polynomial function from Actual
100 0.0 0.818 100.00 0.00
90 0.0 0.884 90.01 0.01
80 0.0 0.955 80.00 0.00
70 0.0 1.035 70.01 0.01
60 0.0 1.123 60.11 0.11
50 0.0 1.221 50.35 0.35
40 0.0 1.332 40.78 0.78
30 0.0 1.457 31.34 1.34
20 0.0 1.600 21.85 1.85
10 0.0 1.765 11.79 1.79
0 0.0 1.958 0.00 0.00
90 1.3 0.835 90.02 0.02
80 1.3 0.903 80.02 0.02
70 1.3 0.977 69.99 -0.01
60 1.3 1.060 60.01 0.01
50 1.3 1.152 50.11 0.11
40 1.3 1.256 40.35 0.35
30 1.3 1.372 30.73 0.73
20 1.3 1.505 21.15 1.15
10 1.3 1.657 11.31 1.31
0 1.3 1.833 0.44 0.44
80 2.6 0.852 80.03 0.03
70 2.6 0.923 70.02 0.02
60 2.6 1.000 60.00 0.00
50 2.6 1.087 50.00 0.00
40 2.6 1.183 40.11 0.11
30 2.6 1.292 30.33 0.33
20 2.6 1.415 20.64 0.64
10 2.6 1.556 10.85 0.85
0 2.6 1.718 0.49 0.49
70 3.9 0.870 70.04 0.04
60 3.9 0.944 60.02 0.02
50 3.9 1.025 49.99 -0.01
40 3.9 1.115 40.01 0.01

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PT. International Nickel Indonesia (Soroako)
Mine Department (DP. 19)  2800

MEMORANDUM - Page 5

30.11

30 3.9 1.217 0.11

20 3.9 1.331 20.29 0.29
10 3.9 1.461 10.48 0.48
0 3.9 1.611 0.37 0.37
60 5.2 0.889 60.05 0.05
50 5.2 0.966 50.03 0.03
40 5.2 1.051 40.00 0.00
30 5.2 1.145 30.02 0.02
20 5.2 1.252 20.10 0.10
10 5.2 1.373 10.22 0.22
0 5.2 1.511 0.22 0.22
50 6.5 0.910 50.06 0.06
40 6.5 0.989 40.03 0.03
30 6.5 1.078 30.01 0.01
20 6.5 1.177 20.03 0.03
10 6.5 1.290 10.09 0.09
0 6.5 1.418 0.10 0.10
40 7.8 0.931 40.07 0.07
30 7.8 1.014 30.05 0.05
20 7.8 1.107 20.04 0.04
10 7.8 1.212 10.05 0.05
0 7.8 1.330 0.05 0.05
30 9.1 0.953 30.09 0.09
20 9.1 1.040 20.08 0.08
10 9.1 1.138 10.07 0.07
0 9.1 1.248 0.06 0.06
20 10.4 0.977 20.12 0.12
10 10.4 1.068 10.12 0.12
0 10.4 1.171 0.11 0.11
10 11.7 1.003 10.16 0.16
0 11.7 1.098 0.18 0.18
0 13.0 1.030 0.23 0.23