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GOLD-COPPER EXPLORATION - INDONESIA

OPPORTUNITIES AND CHALLENGES

Sukmandaru Prihatmoko
Ikatan Ahli Geologi Indonesia (IAGI)
Masyarakat Geologi Ekonomi Indonesia (MGEI)

Bandung, September 2014
TALK OUTLINE

 GOLD-COPPER AND CURRENT STATUS

 GOLD DEPOSITION, ORE DEPOSIT MODELS, AND MINERAL
ENDOWMENT

 EXPLORATION, MINE DEVELOPMENT AND THEIR CHALLENGES

 EXPLORATION MANAGEMENT
TALK OUTLINE

 GOLD-COPPER AND CURRENT STATUS

 GOLD DEPOSITION, ORE DEPOSIT MODELS, AND MINERAL
ENDOWMENT

 EXPLORATION, MINE DEVELOPMENT AND THEIR CHALLENGES

 EXPLORATION MANAGEMENT
Successful Companies since 1950
World Gold Discoveries 1950 - 2010

(Schodde, 2011)
Top 10 Gold Producing Countries in The World
(Tonnes)
450
403
400

350

300
250
250 230 Gold Production
205 (Tonnes)
200
170 165
150
102 102
100 90 89

50

0

Source: www.celebritynetworth.com
Top 10 Copper Producing Countries in The World
(000 Tonnes)
6000 5700

5000

4000

3000 Copper Production _x000d_(000 Tonnes)

2000 1650
1300 1220
990 930 900
1000 830
630
480

0
Chile China Peru United States Australia Russia Congo Zambia Canada Mexico

Source: http://minerals.usgs.gov/minerals/pubs/commodity/copper/mcs-2014-
coppe.pdf
INDONESIA GOLD PRODUCTION (1990-2013)
Source: ESDM (2014); KITCO (2014): USGS (2014)

9,000 1,800.00

1,700.00
8,000 1,600.00

1,500.00
7,000 1,400.00

1,300.00
6,000
1,200.00
Gold Production
(Ounce) 1,100.00
*in thousand 5,000
1,000.00

900.00 Gold
4,000
800.00 Price
(USD)
700.00
3,000
600.00

2,000 500.00

400.00

1,000 300.00

200.00

0 100.00
1990.0
1991.0
1992.0
1993.0
1994.0
1995.0
1996.0
1997.0
1998.0
1999.0
2000.0
2001.0
2002.0
2003.0
2004.0
2005.0
2006.0
2007.0
2008.0
2009.0
2010.0
2011.0
2012.0
2013.0

Year
INDONESIA COPPER PRODUCTION
(1990-2013)
Source: ESDM (2014); LME (2014): USGS (2014)

10,000.00 1,400

9,000.00
1,200

8,000.00

1,000 Copper Price (USD)
7,000.00
Copper Production (Metric Tonnes)

6,000.00
800

5,000.00

600
4,000.00

3,000.00
400

2,000.00

200
1,000.00

- -
1996.0 1997.0 1998.0 1999.0 2000.0 2001.0 2002.0 2003.0 2004.0 2005.0 2006.0 2007.0 2008.0 2009.0 2010.0 2011.0 2012.0 2013.0
TALK OUTLINE

 GOLD-COPPER AND CURRENT STATUS

 GOLD DEPOSITION, ORE DEPOSIT MODELS, AND MINERAL
ENDOWMENT

 EXPLORATION, MINE DEVELOPMENT AND THEIR CHALLENGES

 EXPLORATION MANAGEMENT
MINERAL (Au-Cu) DEPOSITION
Hydrothermal system in volcanic arc
(Corbett and Leach, 1998)
Hydrothermal Manifestation on Surface

Sikidang - Dieng Kuju - Japan

Champagne Pool – New Zealand Kuju - Japan
METAL TRANSPORT IN HYDROTHERMAL FLUID

Chloride Complexes
Au + 2Cl- + H+ ===== AuCl2- + 1/2H2
Ag2S + 2H+ + 4Cl- ===== 2AgCl2- + H2S
PbS + 2H+ + 2Cl- ===== PbCl2 + H2Saq

Bisulfide Complexes
Au + H2S +HS- ===== Au(HS)2- + 1/2H2
Time

Meteoric Water

ORE
Hydrothermal
T, P, pH, etc <<< DEPOSITS
Fluids

Magmatic Water
GOLD DEPOSITION
• Free gold/ native Au
• Electrum (Au + Ag), telluride
• In association/ locked into sulfides (chalcopyrite, arsenopyrite,
galena, sphalerite, etc) – refractory gold
GOLD RICH QUARTZ VEIN
MAGMATIC ORE SYSTEMS (After Corbett, 2005)
TECTONIC CONTROLS OF GLOBAL Au RESOURCES

Metamorphic hosted (Goldfarb, 2009)
Slate and greenstone belts
IOCG
Sedimentary Exhalative
Paleoplacer
?
WORLD GOLD DEPOSITS >/= 150t *

(Goldfarb, 2009)
WORLD PRESERVATION OF PORPHYRY+EPITHERMAL AND OROGENIC Au

(Goldfarb, 2009)
INDONESIA GOLD DISTRICTS : (1900 – 1945)

Kalimantan North
Alluvials Sulawesi

Mangani

Lebong

Cikotok
Indonesia Gold Production / 1900-1989

Dutch Colonial Era Independence
50
Sukarno |
40 Soeharto
Gold (tonnes)

30 Sumatra
CoW
20

10 Pacific War Ertsberg

0
COW GENERATION AND STATISTIC

Contract of Work (COW): 236
Ijin Usaha Pertambangan (IUP): >10,000
INDONESIA GOLD + COPPER MINES 1970-2014
……. Sediment Hosted (Au)

……. LS Epithermal (Au)

……. HS Epithermal (Au)

Active ……. Porphyry/ Skarn (Au + Cu)
Closed ……. VMS (Au + Cu)
Martabe Toka Tindung

Lanut Gosowong
Buduk Mt. Muro
Kelian Kencana
Mesel
Rawas Mirah
Lb Tandai Mt. Muro West

Pongkor Grasberg/ Ertzberg
Way Linggo

Cibaliung
Wetar
Cikidang

Batu Hijau
INDONESIA GOLD (+COPPER) MINE – LAPSE TIMES
Contract
Mine Owner Status Production Lapse
Signed

Lebong Tandai Billiton (CSR) Closed 1985 1986 1
Gosowong Newcrest Closed 1997 1999 2
Wetar Billiton Closed 1986 1991 5
Ertsberg Freeport Closed 1967 1973 6
Pongkor Antam Production 1988 1994 6
Kelian Riotinto Closed 1985 1992 7
North Lanut J-Resources Production 1997 2004 7
Mt. Muro Aurora Closed 1985 1994 9
Kencana Newcrest Production 1997 2006 9
Mesel Newmont Closed 1986 1996 10
Rawas Laverton Closed 1986 1997 11
Cibaliung Austindo/ Antam Production 1998 2010 12
Batu Hijau Newmont Production 1986 1999 13
Martabe G-Resources Production 1997 2012 15
Toka Tindung Archipelago Production 1994 2011 17
Mt. Muro West Straits Production 1985 2004 19
Grasberg Freeport Production 1967 1989 22

Average Lapse Time (Years) 10
Gold/ Copper Mines - Indonesia

Mine 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14

Grasberg
Lebong Tandai
Alluvials
Wetar
Kelian
Pongkor
Mt. Muro
Mesel
Rawas
Gosowong
Cikidang
Batu Hijau
Mt. Muro West
North Lanut
Buduk
Kencana
Cibaliung
Toka Tindung
Mirah
Martabe

Porphyry VMS

LS Epithermal Sediment Hosted
INDONESIA PRIMARY GOLD + COPPER DEPOSITS/ MAIN OCCURENCES

……. Sediment Hosted (Au)

……. LS Epithermal (Au)

……. HS Epithermal (Au)

……. Porphyry/ Skarn (Au + Cu)

Seruyung ……. Metamorphic Hosted (Au)

Pungkut
Tombulilato
Jelai-Mewet Kaputusan

Motomboto
Bt Tembang Paboya

Ojolali Wabu
Selogiri Awak Mas
Elang
Cikondang

Tujuh Bukit Pangulir
COMMON GOLD + COPPER PROCESSING

DEPOSIT TYPE ORE TYPE PROCESSING TECHNIQUE
……. Sediment Hosted (Au) Refractory Roasting

……. LS Epithermal (Au) Native/ electrum/ telluride CIP/ CIL

……. HS Epithermal (Au) Refractory Roasting/ heap leach for oxide

……. Porphyry/ Skarn (Au + Cu) Refractory Flotation etc

……. Metamorphic Hosted (Au) Native/ electrum (+refractory) CIP/ CIL (+roasting)

Oxides Heap leach
GEOLOGICAL PROSPECTIVENESS
SIMPLIFIED MAGMATIC ARC AXES
INDONESIA GOLD ENDOWMENT
Au (Moz) (status by Dec 2013)

N = 110
(published papers, news releases, and unpublished reports

TOTAL Au: 237 Moz ~ 6,723 tonnes

Deposit Type
MAGMATIC ARCS vs GOLD ENDOWMENT
Non Magmatic Arc:
Total Au: 237 Moz 0.76 Moz (Metamorphic Hosted
Gold)
INDONESIA GOLD ENDOWMENT
Au (Moz) (status by Dec 2013)

TOTAL Au: 237 Moz ~ 6,723 tonnes

Au (Moz)
140.00&

120.00& 113.52&
Magmatic Arc
100.00&

80.00&
68.69&

60.00&

Deposit Type 40.00&

20.00& 14.88&12.44&
10.94&
5.12& 4.09& 3.83& 1.53&
0.76& 0.51& 0.46& 0.38&
0.00&

&

&
Eastern&

Sulawesi&

Western&

Kalimantan&

&

Sulawesi&

Halmahera&

Banda&

MoonJUtawaJObi&

MeratusJSumatera&
Papua&

Arc&

Schwanner&
Aceh&
Sunda&

&

Sunda&

&
North&

&

West&
Central&

MagmaI c&
Non& &
TALK OUTLINE

 GOLD-COPPER AND CURRENT STATUS

 GOLD DEPOSITION, ORE DEPOSIT MODELS, AND MINERAL
ENDOWMENT

 EXPLORATION, MINE DEVELOPMENT AND THEIR CHALLENGES

 EXPLORATION MANAGEMENT
STAGES IN MINING (MINERAL EXTRACTION) INDUSTRY

Geoscientist

Exploration Mining - Engineering

EXTRACTION &
Geological
MINERAL PROCESSING
Knowledge/
DEPOSIT (good mining
Exploration Skill
practices)

Discovery Feasibility
Study

IUP Eksplorasi IUP Operasi Produksi
MINING BUSINESS
MINERALFOW
K
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CYCLE OF MINING BUSINESS PROCESSES
Y
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EVLOPMNTRDUCIXA&HGYS
EXPLORATION & OPERATION - PRODUCTION

 Why explore?
 Where, what and how to explore?
 Can we make a discovery?
 Can we mine?
 Can we make a profit?
 Can we repatriate?
CHARACTERISTICS OF MINING BUSINESS
 Remote area, far from community/ civilization
 Minimum infrastructure support
 Capital intensive
 Sensitive to commodity prices
 Sensitive to social and environmental issues
 Non-renewable
 Long exploration period (3-10 years)

Mining Industry Benefits (for stakeholders)

 Increasing investment (domestics and foreign)
 Capital goods and services, including local content
 Contribution to economic growth (local and national)
 State/ government incomes (taxes: PPN, PPh, PBB, retribusi, bea
masuk etc)
 Employment opportunities and improvement of human capital
 Environmental improvement
CASH FLOW vs TIME from a typical mining investment

WHY EXPLORE?
 Maintain or increase return on investment
 Maintain or increase depletion of ore reserves which are the asset base of mining
 Remain competitive in the industry
 Diversify
 Control raw material sources for mineral processing and/ or marketing ventures
Review of Exploration/ Mine Targets

 Regional tectonic setting and geology
 Past record of mineral endowment and success ratios
 Legal and fiscal systems
 Politics and stability
 Others: infrastructure, social, etc
PORPHYRY vs EPITHERMAL TARGETS

E P ITH E R M A L
500m A u - A g V e in
+ 3 M t O re
L if e < 1 0 Y e a r s

200m

1 0 m w id e

700m

2 0 0 m w id e
350m

PO RPHYRY S TO C K W O R K 200m
C u - A u S to c k A u - A g S w a rm
+ 4 0 0 M t O re + 3 0 M t O re
L if e > 2 0 Y e a r s L if e 5 - 1 0 Y e a r s

A M C 9 9 1 0 6 /O C T .9 9 /S P 4
MINERAL EXPLORATION PROCESS
Area of Interest Odds of finding
economic deposit
Time Cost/Km2 Typical Stage Method
<1:100,000 •
Area Selection •
In-house expertize
Published data review
1-6 100-10,000Km 2
To select, regions with favourable mineral potential and
$2-5 • Mineral deposit models
months >1:5,000 secure exploration/ mining contract/ licenses • literature studies

• Geology
Reconnaissance • Geochemistry
3-12 100-1,000Km 2
$100- To indetify mineralized areas and screen-out those not worth • Image interpretation
months 500 >1:1,000 further exploration • Geophysics

$1000- General Survey • Geology
6-18 To locate, sample and outline mineralized zones in the field, and • Prospecting
10-50Km 2
5000 • Geochemistry
months screen-out those not worth further investigation • Geophysics
>1:100

• Geology
$500,000- Exploration • Drilling
1-2 2-5Km2 1 million To preliminarily define deposits in 3D, estimate indicated • Geochemistry
years resources and screen-out worth further investigation • Geophysics
>1:10

• Geology
1-3Km2
Detailed Exploration • Drilling
To delineate ore bodies in detail, estimate measured resources, provide • Resource estimation
$3-1 million sufficient data to allow reserves to be estimated and allow a decission • Metallurgy
2-3
to be made whether to proceed to a feasibility study • Geotechnical
years • Mine design
• Environmental
>1:2 • Financial

3-5 years $>250 million Feasibility, Construction, Start of Mining
Sumbawa - Newmont

Regional Geology - SW Sumbawa
A E X P L A N A T IO N
V o l c a n o - s e d i m e n ta r y R o c k s
N
A llu v iu m A
Q u a te r n a r y
U p li f t e d c o r a l r e e f 5 k ilo m e te r s

P lio - A n d e s i t ic d o m e s a n d d y k e s
P l e is t o c e n e V o l c a n i c la s t i c r o c k s
5 9 020 000N
L a te M io c e n e - C o r a lli n e l im e s t o n e
E a r ly P lio c e n e
D a c it ic v o l c a n ic l a s t i c s e q u e n c e
A n d e s i t ic v o lc a n i c la s ti c r o c k s

V o l c a n i c c o n g lo m e r a t e
V o l c a n i c l it h i c b r e c c ia
E a r l y to
M i d d le M io c e n e L im e s to n e
V o lc a n ic s a n d s to n e
U n d i ff e r e n t i a t e d v o lc a n ic a n d v o lc a n i c la s t i c r o c k s

I n tr u s i o n s
M id - P lio c e n e D ia tr e m e b r e c c ia B A T U H IJ A U
T o n a l it e p o r p h y r y
P o r p h y r i t i c t o n a l it e
E q u i g r a n u la r q u a r t z d i o r i t e 9 ° 0 0 'S
U n d i ff e r e n t i a t e d q u a r t z d i o r i t e
L a te M io c e n e P o r p h y r i t i c a n d e s it e a n d m i c r o d i o r i t e
S y m b o ls 9 000 000N
Q u a r t z v e in z o n e
F a u lt
T o p o g r a p h i c li n e a m e n t B
I N D I A N O C E A N
B a t u H i j a u u lt i m a t e p i t
25
B e d d in g

450 000E 470 000E 490 000E 1 1 7 ° 0 0 'E

(Courtesy of PT NTT)
Sumbawa - Newmont

Gold Mineralization and Lineaments

N
5 k ilo m e te r s

9 020 000N

LEG END
Ten em en t b o u n d ary
M a j o r li n e a m e n t
M in o r lin e a m e n t
B a tu H ija u u ltim a te p it

9 010 000N

G O L D (P P B ) R A N G E
> 200
100 - 200
50 - 100 9 ° 0 0 'S
30 - 50
10 - 30
5-10

9 000 000N

I N D I A N O C E A N

4 5 0 ,0 0 0 E 4 6 0 ,0 0 0 E 470 000E 480 000E 490 000E 1 1 7 ° 0 0 'E 500 000E

(Courtesy of PT NTT)
Sumbawa - Newmont (Courtesy of PT NTT)
SW Sumbawa - Geochemistry & Geophysics
S tr e a m S e d im e n t G e o c h e m is t r y -8 0 # C u Stream Sediment Geochemistry
Geochemistry -80 # Au
Au
So u th w e st Su m b aw a Southwest Sumbawa
T a n ju n g Je le n ga
J e re w e h H ijr a h Tanjung Jelenga
Hijrah
J e re w e h
Jereweh Jereweh

T e lu k B e n e t e B e n e te
Teluk Benete
> 10 ppb
Benete
M A LU K > 50 ppm > 30 ppb
C .o .W B o u n d a ry Gold Ridge
> 100 ppm MALUK
C.o.W. Boundary > 120 ppb
T e lu k M a lu k
> 1000 ppm Teluk Maluk
Sekongkang
G o ld R id g e
PROSPECT LOCATION
K a ta la P r o s p e c t lo c a tio n Katala
S ekongkang
S ekongkang

T a n ju n g A m a t Bam bu
L o w e r S e jo r o n g
B A T U H IJ A U
N O R TH
Tanjung Amat
Lower Sejorong
BATUHIJAU
T a n ju n g M a n g k u n
To n g o W E Tanjung Mangkun
Bambu NORTH
S e jo r o n g Tongo Veins Teluk Puna
T e lu k P u n a S Sejorong
0 6K m W E

0 S 6Km
T e lu k P u n a
P R O J E C T Teluk Puna
P R O J E C T

AA iirr bb oo rr nn ee RR aa dd iioo mm ee tt rr iicc ss -- PP oo tt aa ss ss iiuu mm
So u th w e st Su m b aw a
Ta n j u n g J e le n g a

J e re w e h
J e re w e h
H i jr a h
T e lu k B e n e t e B e n e te

M ALU K > 1 . 5 % P o ta s s iu m
C .o .W B o u n d a ry
Te lu k M a l u k
P r o s p e c t lo c a t io n
G o ld R id g e
K a ta la
S eko ng kang
S ekongkang
B a m b u V e in
T a n ju n g

NORTH
Am at
L o w e r S e jo r o n g B A T U H IJ A U
Batu Hijau N O R TH
W E Ta n ju n g M a n g k u n
Tongo W E
S S e jo r o n g T e lu k P u n a
0 5Km S
0 6Km

2/23/17
P R O J E C T P R O J E C T Te l u k P u n a
Sumbawa - Newmont (Courtesy of PT NTT)
Batu Hijau Surface Signatures
S o il G e o c h e m is t r y - C u p p m S o il G e o c h e m is t r y - A u p p b
B a t u H ija u D is t r ic t - S u m b a w a B a t u H ija u D is t r ic t - S u m b a w a
N O RTH

W E

S

B A T U H IJ A U B A T U H IJ A U
0 1000m
< 500 ppm > 1000 ppm
P R O J E C T P R O J E C T

B A T U H IJ A U

2/23/17
P R O J E C T
Sumbawa - Newmont (Courtesy of PT NTT)
Batu Hijau Surface Signatures
G rr oo u nn d M aa gg n e t iic ss II m a g e ( T o t a l fi e l d r e d u c e d t o t h e p o l e ) G r a d ie n t A r r a y - C h a r g e a b ilit y I m a g e
B a t u H ija u D is t r ic t - S u m b a w a B a t u H ija u D is t r ic t - S u m b a w a

B A T U H IJ A U B A T U H IJ A U
0 1000m
< 4450 nT > 5750 nT
P R O J E C T P R O J E C T

G r a d ie n A r r a y - R e s is t iv it y I m a g e
B a t u H ija u D is t r ic t - S u m b a w a
N O RTH

W E

S

B A T U H IJ A U

2/23/17 < 1 0 0 o h m -m > 2 5 0 o h m -m
0 1000m

P R O J E C T
Batu Hijau - Metal Zoning - Cu, Mo & Zn (Courtesy of PT NTT)
478 000m E 480 000m E 482 000m E 484 000m E 486 000m E 488 000m E

9 012 000m N
9 012 000m N

ID U L F IT R I
W ES T N AN G KA
S E KO N G KAN G

EAS T N AN G KA
B E
H
A A IR M E R A H
A gang B r. N a n g k a
T a tu k

G O L D R ID G E KATALA

9 010 000m N
9 010 000m N

ARU N G ARA

B ARAKE B O

KATALA
C D S O U TH
B A T U H IJ A U

9 008 000m N
9 008 000m N

B A M B U V E IN
G S YSTEM
F

C o n c e n tr a to r s ite

M E T A L Z O N A T IO N
T h r e s h o l d ( % ti l e ) ELEM ENT
L im it o f s o il a n d tr e n c h d a ta TO N G O LO K A
90 C opper > 350 ppm
A B S c h e m a t i c s e c t i o n l in e

9 006 000m N
95 C opper > 500 ppm
75
T o p o g r a p h ic c o n to u r ( 5 0 m in te r v a l) N
M o ly b d e n u m > 7 p p m
95 M o ly b d e n u m > 2 5 p p m P r im a r y a c c e s s r o a d s 1 0 0 0 m e te r s

2/23/17
75 Z in c > 1 5 0 p p m S tr e a m

O u t li n e o f 0 . 5 % C o p p e r a t 3 0 7 . 5 m a s l a s m o d e l e d f o r t h e B a t u H i j a u d e p o s i t. U l t i m a t e p it o u tli n e
( r o a d d e t a il s n o t s h o w n w i t h i n t h e p it o u tl i n e )
N o t e : M e t a l z o n a t i o n i n f e r r e d f r o m s o il s a m p le , b e d r o c k tr e n c h a n d o u t c r o p s a m p le r e s u l t s .

478 000m E 480 000m E 482 000m E 484 000m E 486 000m E 488 000m E
Batu Hijau - Pit Geology (Courtesy of PT NTT)

485200 E 486400 E

Y o u n g T o n a lite
In tr u s iv e B r e c c ia
In te r m e d ia t e T o n a lite
In tr u s iv e B r e c c ia
E q u iq r a n u la r Q u a r tz D io r ite
P o r p h y r itic Q u a r t z D io r it e 9009400 N

P o r p h y r itic A n d e s ite In tr u s iv e
V o lc a n ic L ith ic B r e c c ia
F in e G r a in e d V o lc a n ic la s t ic s
Q u a r tz D io r ite U n d iffe r e n tia te d
F a u lt

9008200 N
Batu Hijau - Pit Alteration
(Courtesy of PT NTT)
4 8 5 0 0 0 E 4 8 5 6 0 0 E 4 8 6 2 0 0 E

9 0 1 0 2 0 0 N

M o d e r a te to S tr o n g S e c o n d a r y B io tite
M a f ic P a r tly A lt e r e d t o S e c o n d a r y B io t ite

S e r ic ite - C h lo r it e + /- C la y

F e ld s p a r D e s tr o y e d ( C la y - M ic a )
9 0 0 9 6 0 0 N

F e ld s p a r D e s tr o y e d ( T e x tu r e P r e s e r v e d )

F e ld s p a r D e s tr o y e d (T e x tu r e D e s t r o y e d )
E p id o te P r e s e n t

E p id o t e P r e s e n t
9 0 0 9 0 0 0 N

9 0 0 8 4 0 0 N

July 26, 2001
Batu Hijau 9080N Section - Geology
485080 m E 485680 m E 486280 m E

300 m R L

0 m RL

Ultimate Pit

-3 0 0 m R L

Young Tonalite Intrusive Breccia Equigranular Quartz Diorite
Intermediate Tonalite Old Tonalite Quartz Diorite Porphyry
Volcanic
(Courtesy of PT NTT)
(Courtesy of PT NTT)
Batu Hijau 9080N Section - Cu Grade Model

400 m R L

200 m R L

0 m R L

P it Y e a r 2 0 1 5
-2 0 0 m R L

-4 0 0 m R L 0 250
M e te rs

C u > = 1 .0 % C u > = 0 .5 > 1 .0 %
C u > = 0 .3 < 0 .5 % W e a th e re d Z o n e
(Courtesy of PT NTT)
Batu Hijau 9080N Section - Au Grade Model

400 m R L

200 m R L

0 m R L

P it Y e a r 2 0 1 5
-2 0 0 m R L

-4 0 0 m R L 0 250
M e te rs

A u > = 1 .0 g /t A u > = 0 .2 < 0 .5 g /t
A u > = 0 .5 < 1 .0 g /t W e a th e re d Z o n e
Batu Hijau Tonalite Porphyries

To

2 bio’d hnb

clast Ty hnb

cm scale
(Courtesy of PT NTT)
BATU HIJAU - OREBODY SHAPE

(Courtesy of PT NTT)
BATU HIJAU MINE
BATU HIJAU PROJECT LAYOUT

(Courtesy of PT NTT)
CIBALIUNG - BANTEN

INDONESIA

J a k a rta

C ib a liu n g
Cibaliung Geology

0
S C A LE

B a s a lt f lo w s
S e d im e n t s P o s t-M in e r a l
C ib a liu n g tu ff
H o n j e v o l c a n i c s P -r e - M i n e r a l

V e in
F a u lt

M o d ifie d fr o m M a r jo r ib a n k s ( 2 0 0 0 )
Schematic Section of Cibaliung

NE
SW V V V V V V
V V V V V V V V V
V V V
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S
. . . . . . . . . . + . . . . . . . . . . . . . . . S S S S S S S S S
. . . . . . . . . . . . . . . . . . . .
S S S S S S S
+ + + S S S S S S
S S S S
+ + + S S S
+ + +
+ + +
+ +
+ + +
+ + +
+ + + +
+
+ + +
+ + +
+
+
+ +
+ +
+ E P IT H E R M A L
+
+
+
+
+
V E IN S
In tr u s iv e In tr u s iv e
c o m p le x c o m p le x
N O T TO S C A LE

P o s t - M in e r a l S e q u e n c e P r e - M in e r a l S e q u e n c e
V
V
V B a s a lt f lo w s H o n je v o lc a n ic s F a u lt
S S S e d im e n t s +
+
+ In tr u s iv e s
. . . . .
. . . . .
. . . . . C ib a liu n g T u ff D ia tr e m e B r e c c ia

M o d ifie d a f t e r M a r jo r ib a n k ( 2 0 0 0 )
Cibaliung -Vein Zones & Drill Location

570200 m E
569400 m E
9254600 m N

C ik o n e n g
Shoot
9254200 m N

0 200m
SC A LE

9253800 m N
C ib itu n g
V e in z o n e
Shoot
S hoot

H o le L o c a tio n

9253400 m N
C ib e b e r
569800 m E

M e lin j o (Angeles et al, 2002)
Cibitung Shoot - Geology Section
4490N (Looking North)
A C -0 3 0 A C -0 2 7 A

160m R L

80m R L

0m R L

- 80m R L

- 160m R L

5100m E 5300m E (Angeles et al, 2002)
CIKONENG CROSS SECTION

(Angeles et al, 2002)
CIBITUNG CROSS SECTION

(Angeles et al, 2002)
CIBALIUNG STOPE DESIGN (Courtesy of PT CSD)
CIBALIUNG PROJECT LAYOUT (Courtesy of PT CSD)
Cibaliung Underground Mine
Environmental Concerns
Reclamation
EXPLORATION PROCESS TO MINE DEVELOPMENT
EXPLORATION AND MINING CHALLENGES
WORLD EXPLORATION EXPENDITURES (Schodde, 2011)
WORLD EXPLORATION EXPENDITURES (Schodde, 2011)
SURVEY by Fraser Institute, 2012/ 2013 (summarized by PWC, 2013)
FACTORS AFFECTING INDUSTRY’S FUTURE
(INDONESIA)

 Geological Prospectiveness

 Metal (gold) price

 Country stability (politic and security)

 Legal and economic/ commercial certainties
 Mineral and Coal Law and its Implementing Regulations

 Social – community situation (incl. NGOs)
EXPLORATION CHALLENGES – Technical Aspects

1. Opportunity to generate/ develop new projects is sliming
 Matured Exploration Areas

2. Exploration “going deeper”
 Deeper Targets
 Targets Under Cover
EXPLORATION GOING DEEPER

Gunung Bijih/ Ertzberg (Mertig et al, 1994)
Tujuh Bukit (Intrepid News Release, 2011)
EXPLORATION GOING DEEPER

Kencana (Richards et al, 2005)
Pongkor (Milesi et al, 1999)
DEPTH OF GOLD DEPOSIT DISCOVERIES (Schodde, 2011)
EXPLORATION CHALLENGES – Technical Aspects

1. Opportunity to generate/ develop new projects is sliming
 Matured Exploration Areas (?)

2. Exploration “going deeper”
 Deeper Targets
 Targets Under Cover

3. Targeting unconventional deposit types (“thinking
out of the box”)
 Orogenic Gold
 IOCG (Iron Oxide Copper Gold)
 Sedimentary hosted base metals (sedex and MVT)
 Ni sulfide in ophiolite belts

4. Exploration Costs >>>>
 Need serious investors
EXPLORATION CHALLENGES – Non-Technical Aspects
1. Uncertainty in the tenement system (tender system)
2. Forestry overlapping issues/ problems
3. Pain of regional autonomy
4. Illegal mining
5. Local community and NGO
“SUSTAINABLE EXPLORATION”

Points for Discussion
1. Matured exploration area  slimmer chance to make discovery
 Need to target “concealed deposits”  going deeper and target under
cover
2. “Nationalism” sentiment increasing  but in fact exploration works need more
fund in the current situation
 Domestic investors need to be encouraged apart from the existing foreign
investors
3. Exploration costs increasing  need efficiency
 Data of old exploration programs (by companies and government
institutions) to be compiled comprehensively and professionally and to be
used for the next exploration phases….”let the data speak them selves”
 Metallogeny Map (Badan Geologi) as a starting point (?)
4. Data quality  professional reporting to be implemented by Competent
Persons of PERHAPI and IAGI using Kode KCMI
5. “Small scale mining” with good mining practice need to be developed legally
TALK OUTLINE

 GOLD-COPPER AND CURRENT STATUS

 GOLD DEPOSITION, ORE DEPOSIT MODELS, AND MINERAL
ENDOWMENT

 EXPLORATION, MINE DEVELOPMENT AND THEIR CHALLENGES

 EXPLORATION MANAGEMENT
EXPLORATION MANAGEMENT

Psychological Factors

“….a dream….”
“If you don’t have a dream, how you gonna make your dream
come true?”

The dream of an exploration team ---
“Making a discovery and turning it up to an economic mine”
WORLD GOLD DISCOVERY MAP 2000-2011 (Schodde, 2011)
WORLD GOLD DISCOVERY COST (Schodde, 2011)
 Panel
Uncertainty in mineral Discussion JCM 2011 HAGI – IAGI
tenement
system (Mining Law)Investment Climate on Indonesia Mining Industry
 Forestry overlapping issues
 Pains of regional autonomy
 Illegal mining
 Local community / NGOs

Source: Doug Kirwin
FACTORS FOR DISCOVERY

1. Challenge
2. Culture
3. Confidence
4. Organizational structure
5. Focus
6. Skill
7. Timing
8. Business sense
9. Persistence
KEY ASPECTS IN EXPLORATION MANAGEMENT/ SUCCESS

1. Setting up objective/ goal……(must be clear)
2. Designing strategy
3. Planning the steps to implement strategy (technical and non
technical aspects)
4. Planning organization……(small, loose, with skilled pesonnels)
5. Budgeting…..(should be opportunity creator, not mainly a
control device)
6. Administration, legal and manpower planning & management
EXPLORATION STRATEGY OPTIONS

1. Greenfield
a. Along magmatic arcs  going deeper and under cover
b. Unconventional deposits
2. Brownfield
. Old gold districts
3. Project/ mine acquisition

Acquistion…. vs …New Application
FACTORS AFFECTING INDUSTRY’S FUTURE – INDONESIA
(SUMMARY)

 Geological Prospectiveness (++)

 Metal (gold) price (+)

 Country stability (politic and security) (+/-)

 Legal and economic/ commercial certainties (+/-)
 Mineral and Coal Law and its Implementing Regulations
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