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By Brian C. Asbury

Gold-bearing quartz veins with auriferou pyritic wall rock alteration haloes at the Komis deposit near Waddy Lake in northern Saskatchewan occur in fractured Archean intermediate volcanic rock flanking a plutonic felsic intrusion. Three ore zones totalling 1.5 million tonnes grading five g/t gold have resulted from a combination of patterns of high density of fracture-filling quartz veins created by contrasting competencies of four predominant rock types and preferential gold deposition in magnetitebearing andesite host rock. Pre-glacial surface weathering remobilized gold from a nearby pyritized intermediateto- felsic dyke to form the EP Zone with a wide variety of supergene accessory minerals. Much of the EP Zone wa eroded by glacial action to forn1 a highly anomalous gold-bearing till dispersion train which facilitated its di covery.

Jan 1, 1986

By R. K. Netolitzky

The Weedy Lake, Tower Lake, and Wedge Lake gold deposits illustrate contrasting styles and different ages of mineralization within the same district. The discovery of these deposits was the result of systematic exploration of gold occurrences noted during research of assessment files. The Weedy Lake and Tower Lake depo its reflect a late-stage gold mineralizing event. The e deposits developed along the same major structural break, and also display simi lar mineralogy and alteration patterns. Mineralization is developed in all the lithologies present. The Wedge Lake property, while having occurrences similar to the Weedy and Tower deposits. has the more important Twin Zone which best fits a volcanogenic exhalative model. The Twin Zone has a complex structural history without a recognizable alteration halo. The setting may be proximal to a hydrothermal vent. Mineralization is hosted within a mixed ulphide/oxide/silicate facies iron formation breccia. and the gold is intimately associated with arsenopyrite. The origin and age of the brecciation is key to understanding the mineralizing event. Traditional prospecting procedures in conjunction with conventional B-horizon soil geochemistry were instrumental in the Twin Zone and Weedy lake disco,•eries. Tower Lake was a prospecting discovery partially defined by previous drill programs. This deposit was also identified by B-horizon oil sampling.

Jan 1, 1986

By W. S. Fyfe

Gold is mobilized and precipitated in a wide variety of environments ranging from those of weathering and biological phenomena, to pluton emplacement to deep metamorph ism . But it appear that pervas ive leaching of large rock volumes fo llowed by the focussed di charge of typically low salin ity flu ids is frequently involved. There are great gaps in our knowledge, particula rly with re pect to gold in very high temperature fl uids generated at near Moho depths. But uch flu id may play an important part in Archaean pluton associated lode gold deposits whe re ultra high temperature fluids, rich in C02-CO-COS, may be associated with magma underplating and crustal assi mil ation processes (sag subduction) associated with very den e ult ramafic magma . Other environment with great potential include those of major thru t fau lt and strike slip fa ult s where large quant ities of fluids are mobilized .

Jan 1, 1986

By Michel Mellinger

This paper presents preliminary results of a project aimed at obtaining a better understanding of the genesis of gold mineralization in northern Saskatchewan using lithogeochemistry. The properties sampled were: Weedy Lake (B Zone), Waddy Lake (Komis Zone) and Wedge Lake (Twin Zone) in the La Range belt, and the Rio mine in the Flin Flon area. Although the three vein-type deposits rudied here (Weedy Lake. Waddy Lake, Rio deposit) occur in different geological situation . a common gold deposition mechanism appears to have been active at all three location . Hydrothermal fluids carrying sulphur in solution in exces of gold thio-complexes moved through fractured host-rocks until they reached a site where pyrite precipitation wa triggered. As pyrite precipitated, the a/ aAu activity ratio of the fluid decreased. until a critical thre hold was reached and gold thio-complexe were de tabilized . resulting in the co-precipitation of gold and pyrite. The conditions triggering the precipitation of pyrite appear to have been: the abundance of iron in host-rock ~ilicates at Waddy Lake. and temperature decrease upon the reaching of structural trap~ at both Weedy Lake and the Rio deposit. with additional involvement of carbonatizationrelated reactions between fluid and host-rocks for the latter. In addition to pyrite precipitation , potassic alteration of the mafic metavolcanics is observed at Waddy Lake. while at the Rio deposit, the extensive carbonatization of the host-rocks i coupled with the deposition of chlorite that may have been remobilized from the altered mafic host rocks. In both the B Zone at Weedy Lake and the Komis Zone at Waddy Lake, a di tinct vanadium signature give some clue about the direction in which the hydrothermal fluids have moved . and the interpretation made is con istent with the geological ituation in either case. As for the Wedge Lake deposits, the distinct base metals-precious metals a sociation within a sulphide-facies iron formation confirm the volcanic exhalative origin of this gold mineralization .

Jan 1, 1986

By W. A. Padgham, J. A. Brophy

About 85 % of the 350 tonnes of gold produced by 25 mines in the onhwe t Territories (NWT) since 1935 has come from the Yellowknife-area mines, Con and Giant , which exploit shear zones in Archean mafic volcanic of the Slave Structural Province. Four percent of the total production has been from Archean iron formation-hosted depo its, mainly from Lupin Mine, which today produces more gold than Con and Giant combined and has been primarily responsible for the increase of WT gold output from 5 to 12 tonne per year since 1981. The remaining gold ha been won from the following deposit typesall but the last being in Archean rock : sedimentary-volcanic contact depo its uch a Discovery and Salmita (10 %); turbidite-hosted quartz-vein depo its uch a Camlaren and Ptarmigan (1%); Proterozoic deposits such as Shear Lake and Fox (1#) . All but I% of WT gold has come from the Archean Slave Structural Pro ince, which is also the premiere exploration area for gold deposit types that have yet to be productive in the NWT. These types include stratabound gold in mafic and in felsic volcanic rocks (eg. , at Indin Lake and Courageous Lake, respectively) as well as gold in plutonic rocks (eg. Anialik Gnei Complex). Deposits similar to those in the Slave have al o been found in the Archean Ennadai Belt of the Churchill Structural Province. In the Cordillera. there is potential for placer gold and for gold associated with Cretaceou intrusions.

Jan 1, 1986

By John Kruse, Sethu Raman, Dave Tenney

The Cullaton Lake B-Zone gold mine was the first gold producer in the Kaminak Subprovince of the Canadian Shield . Located approximately 650 km north of Thompson. Manitoba, the mine produced 77,783 ounces of gold and 5,564 ounces of sil ver from 251 ,236 tons of ore during 1981-84 period. The depos it is a small , structurally controlled , stratabound orebody in an Archean iron formation. Most gold occurs in sulphide and silicate fac ies. Based on new ev idence, the depos it is interpreted to have fo rmed by remobilization of syngenetic low-grade gold mineralization in the iron fo rmation in a favoura ble fold structure. The concept and methods developed at the mine have been successfull y applied in the discovery of new deposits in the area. One of the concepts. which link Archean and Proterozoic mineralization. may have wider applications in the search fo r gold deposi ts elsewhere in Canada .

Jan 1, 1986

By Brian W. Mackenzie

The paper addresses five questions concerning the economic of gold exploration in the western Canadian shield. Can historical footprints be used to project future gold prices for exploration planning? Experience suggests that gold price forecast are too clo ely tied to current market events to provide meaningful guidelines. What range of breakeven gold price will typically be required to ju tify gold exploration in Canada? Minimum price requirements. initially asses ed at $540 to $1080 per ounce, probably lie in the range of $480 to $760 per ounce (expressed in 1985 Canadian dollar). Within Canada, what role do regional conditions and taxation policies play in determining the viability of prospective gold exploration targets? Striking interprovincial differences are found to exist, given the same geological circum tance -Nova Scotia, ew Brunswick, and Quebec rank towards the top in term of motivating exploration, Briti h Columbia provides the least investment incentive, while Saskatchewan and Manitoba place around the middle of the Canadian league. How can minimum acceptable tonnage-grade conditions for gold targets in the western shield be established and, then, constructively applied to provide exploration planning guidelines? Minimum target conditions, realis tically defined in terms of a broad band of doubt, can be used judiciously to help balance the direct costs of uneconomic exploration with the opportunity costs associated with rejecting economic deposits. How does the average cost per ounce of gold discovered in the western shield compare with the overall Canadian experience? Average discovery costs for the we tern shield, apprai ed at $100 per ounce, are shown to compare favourably with the Canada-wide record.

Jan 1, 1986

By W. A. Padgham, H. Helmstaedt

Field evidence for current hypothe e about age and kinematic ignificance of gold-bearing hear zones in the Archean Yellowkni fe greenstone belt is reviewed , and it is concluded that major disagreements between previous workers are a direct result of differences in stratigraphic and tructural in terpretations of the Yellowknife Supergroup. Although goldbearing hear zone appear to be confined to the mafic volcanic pile of the Kam Group. it can be shown that shearing affected all supracru tal rocks, including the Jackson Lake Formation. now con idered to represent the youngest unit of the Yellowknife Supergroup. tructural ob ervations are incompatible with the hypothe is that the hear zones represent loci of ynvolcanic gravity sliding but are consistent with earlier conclu ions that shear zone development commenced with rotation of the volcanic pile and continued as re ult of lateral shortening broadly overlapping with the emplacement of granitoid batholiths. Shear Zones are common throughout the entire green tone belt. yet productive zone are confined to the Yellowknife Bay Formation of the Kam Group and localized where flow abut with a high angle again t the contact of the We tern Plutonic complex. However. no obvious tructural and lithological features have been recognized that are more favorable for gold deposition and distinguish the shear zones and flows of the area around the mines from those of other parts of the greenstone belt. The model that gold wa transported by metamorphic solutions and that hear zones were the firs t-order control for gold deposition provides no explanation for the trong localization of the depo it . As porphyries with elevated gold contents are present in and near ome of the mines. the possibility that gold was deposited from hydrothermal system around fel ic intrusion representing early phases of the Western Plutonic complex should be given erious consideration.

Jan 1, 1986

By S. Averill, B. Schreiner, V. Sopuck

The La Ronge. Kisseynew, Glennie Lake and Flin Flon domains. the main focu for gold exploration in the southeast part of the Saskatchewan Shield, were subject to continental glacial ice advances from the northeast during the Quaternary. Based on forty-four auger hole along with surficial mapping, the general Quaternary stratigraphy in this area is observed to be composed of a lower till unit , an overlying stratified unit of glaciofluvial sand and gravel and/or a glaciolacustrine silt-clay unit. an upper till. and an upper tratified unit. The lower till is commonly found throughout the geological domains except where it has been eroded in glaciofluvial or fluvial channels. Glacial Lake Agassiz fo rmerly covered most of these prospective domains. The lacustrine deposits associated with the lake impede surficial geochemical surveys including soil. lake sediment. and biogeochemical surveys. The approximate extent of clay cover can be predicted from beach elevations. For instance. in the Waddy Lake area. clay i not known to occur above about 1,400 feet (425 m) elevation. Exploration techniques are hampered by clay in at least one third of the volcanic belt. Thi s influence is indicated by the fact that nearly all gold prospect found to date are located above 1,400 feet (425 m) while the area of clay cover is vi rtually unexplored. The upper till i related to a minor ice readvance. This till is the medium often sampled during soil surveys in the area . lts value as a geochemical ampling medium is dependent on the extent of erosional contact with bedrock highs on the lower till. Those areas which are relatively free of lacustrine and fluvial deposits are those where surface geochemical methods work best. In the Waddy Lake volcanic belt approximately 25-50% of the area may be suitable for surficial surveys. The area of the Star Lake prospect occurs above the 1,500 foot (460 m) elevation and was not covered by Lake Agas iz. The effectivene of till sampling as a surface sampling medium was tested in those areas above the clay level. Till orientat ion surveys were carried out at the Star Lake property and the Tower Lake prospect (Waddy Lake area) within the La Ronge Domain . Gold grain counts and analy es of heavy mineral concent rate from 7 kg surface ti ll samples were used to delineate dispersion trains down-ice from mineralization. In addition, the clay fraction and a 30 g (-80 mesh) subsample from the same till sample, were analyzed for gold . In the Star Lake area, ice direction is subparallel to the strike of several narrow northeast trending auriferous structures. arrow dispersion trains down-ice from known

Jan 1, 1986

By Rodney R. Koch

The phys ica l properties of gold should faci li tate its detection. However, the average concentration of gold in the ea rth's cru st precl udes the ability of geophys ical methods to detect the metal directly. In order to effectively pursue geophys ical detection and location of gold mineralization there must also be geological input - i.e. a model. This will lead to the selection of the appropriate geophy ical techn ique(s) in the fo llow-up programs. Interpretation of the fie ld survey data is of con iderable importance in expl oration geophys ics. Analytical techniques such as cont inuation, fi ltering, and spectral analys is, are now routinely empl oyed in the analys is of survey data to aid the interpretation process. The uccessful application of geophysical methods and the use processing techniques is demonstrated by two recent Saskatchewan discoveries. The first, the Star Lake 21 Zone, with reserves of 230,000 tons grading bener than 17.14 git Au associated with a disseminated sulphide quartz-bearing shear zone yielded geophysical anomalies that were distinctive, obvious, and would have lead directly to its discovery. The econd , the Laurel Lake Prospect, with ore grade intersections of 28.0I git Au and 52 .46 git Ag· over 5.49 m, resulted in numerous geophysical anomalies. However, none of these anomalies demonstrated association with the mineralization until processed results indicated that structural features crosscuning regional trends were important cont rol mechanisms for the mineral ization.

Jan 1, 1986

By A. H. Ransom, M. E. Robb

The Salmita Gold Mine is located 240 air kilometres northea t of Yellowknife on the east shore of Matthews Lake. Salmita is one of several gold showings which are regionally associated with the steep easterly dipping contact zone between mafic, intermediate and fe lsic volcanics to the west and overlying finely laminated argillaceous sediments to the east. The volcanic assemblage forms a narrow 2 m to 7 m wide north to northwesterly trend ing Belt of Yellowknife Supergroup Archaen greenstone rocks. The contact zone exhibits exhalite character and the increased sulphide content provides a di stinct VLF-EM , IP/Resisti vi ty and/or magnetic signature. Gold occurs at or near this contact in three main settings: associated with si liceous vein-like structures; with finely disseminated sulphides within ericitic altered upper fe lsic tuffaceous unit ; or with quartz in narrow shear zones within the overlying sediment . The B-Vein is of the former type with free mi ll ing gold occurring within a highly sil iceous zone having an average widtn of 1.69 m. Alteration is intense within the immediately su rrounding host lithologies and includes the development of si lica, carbonate, sulphide, sericite and chlorite with minor graphite, epidote. tourmaline and scheelite. The mineable zone above the 4th level (-200 m) ha an average strike of 160 m and is divided into three south plunging ore shoots separated by the regional Salmita Shear Zone in the south and by a low-grade structural hiatus in the north. Production from the B-Vein commenced in August 1983 based on a diluted in situ ore reserve of 140,000 t grading 26.6 git Au . As of December 31, 1985, a total of 131 ,537 t grading 27.8 git Au have been mined at a ra.te of 160 t per day and a 96.4 percent recovery, to produce 3,522 ,000 g (113,227 ounces) of gold . Current (January I, 1986) reserves total 45,500 t grading 37 g/t Au down to the 10th level (-500 m) .

Jan 1, 1986

By K. Howard Poulsen

Shear zones are tabular tructures which tend to occur either discordantly within, or concordantly along the margins of, competent rock masse uch as plutons, sill or flows. They contain deformed equivalents of their host rock and are common sites for gold mineralization localized in tructure oriented y tematically relative to the shear zones and internal linear fabric. Apan from genetic implications, hear zone analysis proves useful in exploration for this type of deposit because the zones are generally wider and more continuous than associated mineralization and because there is an element of predictability to mineralization geometry (i.e. vein orientation. plunge).

Jan 1, 1986

By Mark A. Krall, Robert L. Geddes, James C. Frost

Introduction The Conda Partnership's Dry Valley phosphate mine is a thinly bedded, multiple seam open-pit mining operation where selective mining techniques are used to recover phosphatic shales. The mining methods used are truck/shovel and scraper/dozer operations. Ore is shipped 32 km (20 miles) by rail to a beneficiation facility. The ore is upgraded by washing and calcining. The mine and beneficiation complexes are owned by the Conda partnership. It is a joint venture between Beker Industries Corp., of Greenwich, CT, and Western Co-Operative Fertilizers (US) Inc., of Alberta, Canada. The Partnership operates as a separate entity of the two partners. The Dry Valley mine is located 48 km (30 miles) northeast of Soda Springs in Caribou County in southeastern Idaho. The mine is situated on the Caribou National Forest. Mining operations take place between 2 and 2.4 km (6400 and 7900 ft) in elevation. It is accessible partly by 32 km (20 miles) of paved roads and 16 km (10 miles) of dirt roads. The winters are long and severe, and the summers are short and mild. This article describes the history, geology, exploration, mining, and reclamation that makes this mine Idaho's largest producing mine and the western US' leading phosphate producer. History and production In the mid-1950s, Western Fertilizers of Salt Lake City, UT, drove an exploratory drift in Maybe Canyon. A large bulk sample of phosphatic shales was analyzed for phosphate content and processing characteristics. No large scale mining or processing operations were undertaken. In the late 1950s, the Dry Valley property was sold to Central Farmers of Chicago, IL. No major operations took place. In 1964, Central Farmers sold the property to El Paso Products Co. of Odessa, TX. El Paso Products supervised the mining operations of Wells Cargo Mining Co. from 1965 through 1967. During this time, El Paso Products built a beneficiation facility and a fertilizer complex in Conda. A 32-km (20-mile) railroad was also constructed from the mine to this facility. From 1968 through 1972, the mine was shut down due to a depressed fertilizer market. In 1972, El Paso products sold its ore reserves, beneficiation plant, and fertilizer complex to Beker Industries Corp. In 1979, Beker Industries sold 50% of its ore reserves and 50% of its beneficiation plant to Western Co-Operative Fertilizers (US) Inc., of Alberta Canada, forming the Conda Partnership. It has operated the mine and beneficiation plant since January 1979. From the mid-1950s to the mid-1960s, no substantial production took place. From 1965 to 1967, El Paso Products stripped 3 Mm3 (4 million cu yd) and mined 2.3 Mt (2.5 million st). From 1972 through 1983, 50 Mm3 (66 million cu yd) were stripped and 18 Mt (20 mil¬lion st) were mined. Geology The Wells Formation forms high ridges and hillsides in the Dry Valley area. It is best exposed along the west face of Dry Ridge. It forms the imposing wall on the east side of Dry Valley. The formation is divided into two members. The lower member, about 213 m (700 ft) thick, is dominantly thin to medium-bedded limestone and silty limestone. It contains nodules and stringers of chert and minor sandstone. The upper member is composed principally of thick-bedded to massive cross-bedded, light-gray to orange-yellow, fine grained sandstone. There is some interbedded brown to light-gray limestone. This member varies from 369 to 457 m (1300 to 1500 ft). Recent investigations indicate that the upper Wells is of Permian age. Under some conditions, the Wells may be water-bearing. Otherwise, it has no apparent economic significance. Grandeur Member (Park City Formation) Overlying the Wells Formation is a distinctive light-gray to white dolomitic fossiliferous limestone. This unit has been identified by the US Geological Survey (USGS) as the Grandeur Tongue Member of the Park City Formation. This member is sometimes absent due to its contact with the Meade Peak Member of the Phosphoria Formation. It is easily detectable by its color, hardness, and fetid odor. Phosphoria Formation The Phosphoria Formation of Permian age was named from Phosphoria Gulch, Bear Lake County. The formation has been studied extensively and developed for its economically valuable phosphate reserves.

Jan 11, 1985

By Peter J. Szabo

The mining executive works in a cyclical industry. His employment is subject to the vagaries of the marketplace. Boom and bust has always been the industry's story. "Big oil" failed in its mining effort. This left emotional and financial scars on many mining families. One must remember that mining executives always play a high-stakes game. Given the cyclical nature of the mining industry, mining executives need to take care of their own financial security. The mining executive that does not plan for his financial security in this cyclical business is playing Russian Roulette with his future. Take a look at those people who have reached their later years with the mining industry. One usually finds three categories of people. Those few in the first group have been fortunate enough to have worked for one company. They have survived the winnowing process of cyclicality, political problems, and takeovers. They have reached normal retirement age. For them, the retirement years are usually comfortable. People in the second group have worked for those same mining companies. But these people have been forced out by early retirement. Or they have been laid off for cyclical, takeover, or political reasons. The third group includes those who have held many positions in the mining industry. Probably not until their later years are they fully vested, if at all, in a pension program. The first small group, then, is the exception. The others, unless they have taken care of their financial security, are doomed to later years of financial problems, stress, and unhappiness. Too late in life, many realize the harsh realities of failure to plan and implement a personal financial program. Mining executives go to some of the world's leading mining schools, to learn how to make money. The curriculum is technically strong. Most mining graduates are familiar with the intricacies of discounted cash flow, present value, and the Hoskold formula. But few of these same mining schools require courses on personal financial planning. Such courses could give mining students a realistic foundation and the mechanisms with which to cope with their cyclical profession. An executive has only three sources of money. He can make money at work. He can put his money to work. Or he can get money from charities, such as government programs. Of these three sources of money, money at work has the best chance of providing financial security in later years. The mining executive must think of the day when he will be too old to work and contribute to the market place. At this point, the quantity and quality of his investments will determine whether his later years will be secure. Along with the Mining Engineering Handbook, two key books should be included in the mining executive's library. These are Venita Van Caspel's The Power of Money Dynamics and Benjamin J. Stein's Financial Passages. These books contain the basic concepts of personal financial planning so critical to an individual's financial survival. Venita points out the simple formula that is the key to financial independence: Time + Money + American Free Enterprise (Rate of Return) = Opportunity to Become Financially Independent Chart 1 shows that this is not a trite formula. The chart shows the dramatic effects of compounding over time. The chart also shows at various yields what a $2000 a year Individual Retirement Account (IRA) contribution will accumulate. Chart 1 (from Money magazine) is based on the future value of an ordinary annuity. It shows that the key to amassing a small fortune by the time a person reaches his 50s is starting to save methodically in his 20s. This, coupled with the highest yields consistent with safety of principal will ensure financial security. There are significant effects from compounding money over time. Every year the decision is put off to save for later years will cost a person dearly by the time he reaches his 50s. For example, consider the decision to put off for one year a $2000 IRA investment at a 12% return. Starting it at age 31 instead of 30 will cost the executive almost $100,000 by age 65. What if the executive waits until age 35 to get started with his $2000 a year investment? He will then lose nearly $400,000 by age 65. Stated another way, the executive costs himself this $400,000 simply because he did not invest $167 a month for five years. $167 a month - that's less than an inexpensive second car payment. This $400,000 pool of money could provide the executive a $40,000 a year income at age 65, assuming a 10% return on invest-

Jan 11, 1985

M.S. Azun I have many objections to the content of the author's paper. Before discussing it, however, I would like to repeat the property of semivariogram function. Second order stationary properties of regionalized variables (ReV's) such as semivariogram function y(h) are perfectly known in geostatistics. Also, the kriging equations in the language of mathematical statistics using second order stationary properties are well understood. However, the way to use the sample (estimated) semivariogram function in any one of the kriging procedures is vague. The sample semivariogram function is given as follows: [ ] where N is the total number of samples, Xi is the sample value at the i - th location, Xi+h is the sample value at the i + h - th location, and h is the distance among the samples. An estimation variance of sample semivariogram function of first lag is smaller than that of higher order lag. The theoretical semivariogram function reaches the variance of samples asymptotically. But this is not easily observable because of the larger variation involved in the estimate of semivariogram function. In general, an estimation procedure is done for h = 0, 1, 2, up to the greatest integer less than N/2, even though sample semivariogram function can be computable through N-1. After estimating semivariogram function, the critical question of how to model sample semivariogram function arises. As seen in the above equation, sample semivariogram function is discrete and can be smoothed by the model being selected. Therefore, modeling of sample semivariogram function is the most important step in geostatistics. It not only smoothes a discrete function but also affects the results of the kriging procedure. When the only aim is to model the semivariogram function, which is the basic point of the author's paper, one can employ any fitting techniques, such as curve fitting, or any arbitrary functions, which are called submodels in the paper. The term "arbitrary function" is used rather than "submodel" because there is no basic understanding of developing them. The author suggests that the sum of those submodels can also be used for the modeling of sample semivariogram function. The combination of any arbitrary functions brings many problems instead of giving an insight of the domain structure considered. The author used two arbitrary functions and the nugget effect in response to sample semivariogram function (Fig. 10). For the same example, he stated that the parameters involved in the mixed arbitrary function model can be accepted when the discrepancy between sample semivariogram function and the model is small visually. For verifying the fitting behavior of any selected model, one should not be contented with the visual satisfactory. Some statistical measure such as goodness of fit has to be used. The author's practice is no more than an exercise in curve fitting without any fundamental understanding or conceptualization of the underlying physical mechanism. Furthermore, the selection of any model is not an easy task if the purpose is the search for the "best" response to the observed second order properties of ReV's. I suggest that the Markovian model (Azun, 1983), on the basis of a theoretical understanding of underlying mechanism, which gives more information about the occurrence of regionalized variables, is used to respond all properties of ReV's. There are a lot of problems for modeling of one-dimensional sample semivariogram function. Thus, it is not appropriate to go to higher order dimensional sample semivariogram function modeling. In the meantime, I would recommend that one can connect the values of standardized sample semivariogram function rather than simple values of semivariogram function in the two-dimensional estimation. The standardized values can be computed in dividing the semivariogram function value by the number of sample pairs involved in each lag regardless of the directions. In conclusion, geostatistics is an interdisciplinary area in mining that uses the principles of mathematical statistics. Thus, it should not violate any probabilistic and statistical rules. When Matheron was developing the theory of geostatistical study in the early years of geostatistics, many mining people had a reservation accepting the geostatistical tools. However, this does not mean that we, the geostatisticians, might try to convince those people using some "strange" tools or rules as some authors implied (Baafi and Kim, 1984). Instead, we have to develop and explain the geostatistical tools staying only in the framework of statistical concepts and properties. References Azun, M.S., 1983, "Stochastic Process Modeling of Spatially Distributed Geostatistical Data," Columbia University, Ph.D. Thesis. Baafi, E.Y., and Kim, Y.C., 1984, "Discussion - Comparison of Different Ore Reserve Estimation Methods Using Conditional Simulation," Mining Engineering, Vol. 36, No. 3, p. 280. Reply by J.M. Rendu The interactive method proposed by Rendu allows practitioners to develop semivariogram models that take into account not only the numerical information obtained by sampling, but also highly significant additional information that often cannot be quantified. The geology of the deposit - including hypotheses concerning its genesis, sampling methods, assaying methods, and mathematical methods used to calculate the semivariograms - all have an influence on the numerical results obtained and on how these results should be interpreted. If all the information concerning the spatial distribution of values in a mineral deposit was contained in the sample values, it could be argued that statistical techniques alone would produce optimum models. However, this is rarely, if ever, the case. Methods that allow the user to take into account his experience and his geologic understanding of the deposit should not be rejected for the sake of theoretical statistical purity.

Jan 11, 1985

By David L. Rife

Introduction Our society is currently experiencing a change in civil philosophy toward US industrialization. We have become increasingly bent on the pursuit of a nirvanic state of zero risk. The money supply has become inversely proportional to its sources. And most mining companies, traditionally conservative, have become increasingly risk conscious. Rising taxes, high inflation, and decades of a steadily decreasing gross national product (GNP) - coincident with moral decay and disarmament - have eroded America's economic health. Psychology of US metal markets has shifted across the economic spectrum to disillusionment and discouragement. The sagging national economy, expanding governmental debt, and a backward mineral policy in concert with worldwide unrest and turmoil have caused great volatility in the metal markets. Congressional inaccessibility of US resources has contributed to its loss in strategic leadership and dependency on foreign suppliers and the common market. Large scale mining activities are now on the decline. And there is an overall slump in mineral exploration in this country. America now faces the sobering reality of almost total importation of 13 key mineral commodities and total dependence on foreign sources for five of them. There is a growing dependency on 21 of the 34 minerals vital to the US economy. And virtually everything needed can be imported directly from third world countries. Almost 85% of the free world's supply or production of vanadium, chromium, platinoids, manganese, and titanium - an essential to the aerospace industry - comes from South Africa. That country now plays a forefront position in supplying the West with minerals. The Soviets have become increasingly aware of this situation. They have made key moves in procuring for their own purposes major raw materials markets, particularly in South Africa. This is obviously threatening to the US' direction and brings about vulnerability to shortages and cutoffs. In spite of these developments and the overall change in the mining industry, there is good opportunity for growth ahead. The way has been paved for the smaller mining companies, particularly the more bullish of these. Smaller mining organizations possess a tight management and strong sense of direction. They can easily adapt to and cope with change. "Windows" that exist in the industry directly depend on a number of factors. These include the busi¬ness climate, market research and planning, management and human resources, applied appropriate technology, favorable hunting ground, and entrepreneurship. Mining as business Mining (and exploration) as a business is by its very nature highly speculative. It involves greater risk for a longer period of time than most other businesses. The entire mineral estate in the US continues to shrink. This is primarily because of various legislated wilderness measures. Consequently, the probability of finding an economic ore deposit in the US has decayed to less than 1%. Although the risk is high, the stakes far outweigh the gamble and are larger than most other businesses can offer. Mining properties, as investments or business opportunities, can provide effective hedges against long-term inflation because the real price for selected commodities, such as gold, may sometimes rise faster than inflation. Recessionary periods seem to provide the best climate for entering the mineral business or for a particular mining organization to expand its activities. Looking ahead and seizing opportunities during a depressed market will pay off. Property payments and royalties are likely to be lower. And the potential for an upward shift in prices for a given commodity is very positive. The decision to invest in a prom-

Jan 9, 1985

By Victor F. Hollister

Introduction Trends of successful discovery technology and psychology emerge from a thoughtful study of various companies' exploration programs. These subjective patterns can be generalized into groups of factors for discussion. Here, for convenience, factors that influence exploration success are separated into management and geologic concerns. Most successful discoveries have a demonstrably favorable management combined with a technically competent geologic input. Both are required. But the management input is decisive. Management factors include the correct definition of management's role; cost of exploration; time needed for exploration; commodity selection; and the fostering of autonomy, creativity, and confidence in the geology department. Geologic factors include imaginative technical competence (field as well as academic), correct development and use of empirical exploration or prospecting models, and dedication. Success comes to those entities that are properly managed and have technological competence. A management team that directs a company's business has been compared to a dynasty. The dynasty lays out policy and follows up with appropriate action. In that management's power is pervasive, the term is appropriate. Management's role is, however, more important. Many examples can be cited where the geologic input was impeccable. But management somehow snatched defeat from the jaws of victory, and the exploration success was turned to a third party's profit. Management Factors Management's role can be broadly generalized to four parts. These are to identify the commodities it seeks, define its part in the exploration process, develop a functioning exploration department, and have the desire to succeed. It must have confidence in its geologists and delegate to them the authority and responsibility they need to operate successfully. Head office management cannot do the thinking for a field staff thousands of kilometers away. There is no substitute for confidence and delegation of authority. Successes came to those who had the freedom to act. Motivation is a management requisite. Management's role is to prevent destructive, internecine political battles within the corporate structure. Most large US mining corporations have well known histories of political strife that have damaged their exploration efforts. Management's role must, above all, include the desire to succeed. There are cases where management has been confronted with a commercial exploration success, but their reaction is to request additional study or exploration. Perhaps the problem of bringing a commercial find into production is beyond their capabilities. But a bona fide discovery sent back for additional work commonly is lost due to that management. The cost of exploration is a factor that management must accept. A variety of studies made during the past 40 years shows the cost per discovery to be $25 million, $38 million, $200 million, or even $290 million. These figures are derived by dividing the total exploration expenditure by the number of discoveries. However, successful management dynasties have a much lower cost per discovery during their management regime. Asarco, from 1948 through 1963, had one of the lowest cost discovery rates in the world. Duval Corp., from 1948 through 1968, had comparably low discovery costs. Placer Development, from 1955, was equally successful. Western Mining in Australia has had one of the longest lived dynasties associated with exploration success. Time is vital in exploration success. Most successful exploration case histories stress sufficient time in project exploration so that the target is well tested. A large target cannot always be adequately evaluated by a few holes (strat or concept testing). Serendipity helps in exploring large targets, but it best operates in a lengthy program. Numerous case histories include pleasant surprises. But these came mostly after the 10th hole. Commodity markets are important factors governing exploration success. Management's decision to explore for a specific commodity can doom its effort if that product suffers from severe oversupply. Unquestionably, progressive copper price increases from 1948 through 1968 helped convert marginal porphyry copper discoveries

Jan 8, 1985

By Paul D. Tomlingson

Part one of this two-part series covers conceptualizing and developing a maintenance information system. It explains what information is necessary to manage such a system. Next month, part two will discuss using this type of system with administrative information, including error and absentee reports as well as open work files. Introduction There is no doubt that quality, timely, and accurate information can make a solid contribution to maintenance cost reduction objectives. Yet, despite obvious benefits, methods being used to acquire information systems are proving costly, frustrating, and often unsuccessful. Those needing the information are disappointed. Mine managers, hoping to reduce costs with quality information, are instead seeing no system, no savings, and massive spending on information endeavors of questionable benefit. Options Any software vendor will happily sell you his program. Numerous mining organizations, having "gone to the cleaners" themselves, will gladly make their programs available to help cover huge trial and error development costs. Any package can only be a generalization. Any program bought from some other organization must undergo numerous modifications to make it work properly. In the process the initial cost is doubled. Many mining maintenance organizations do not know how to go about the task of conceptualizing, developing, installing, and effectively using a maintenance management information system. Consequently, many have hedged their primary responsibility of specifying what information they want, how they will get it, and how they will use it effectively. Into this void have jumped many who claim they can help. But some may not understand the special information needs of maintenance in the mining industry. By default, the whole scene of maintenance information systems has become confused and in need of clarification. A Starting Point Four broad phases are used to organize the steps by which maintenance acquires an effective maintenance management information system and initiates its use. Conceptualization is an identification of needs, factors that influence development, and an assessment of support for the system. Development is a plan of action for bringing the conceptualized information system to life. Consideration is given to the practical aspects of collecting field data, processing it, and converting it into useful information. Implementation consists of those actions by which the newly developed system is integrated into the organization and put in the hands of its personnel so that its value can be derived. Use addresses the means by which personnel use the information to accomplish maintenance improvement objectives. These phases are preceded by establishing the need for the information system. They are followed by a requirement to measure its success (Fig. 1). Conceptualizing the Information System Responsibilities - The information system user must acquire the system best suited for its use. A step-by-step process is essential to avoid many serious problems than can easily occur. The most important step is to clearly identify its objectives and lay out a course of action to achieve those objectives. The major reason for the failure to achieve information objectives is not carrying out this responsibility. Maintenance cannot delegate the task to data processing. It can obtain technical assistance but it must retain responsibility. Nor can maintenance purchase

Jan 7, 1985

By Frank W. Luerssen

Introduction "Austerity" is perhaps an overly generous description of the past three years in the American steel industry. Steel plants operated at an average of only 57% of their capability in 1982-84. The dismal losses for last year are still being totaled. But during the two years before this period, American steelmakers recorded an aggregate net loss of a staggering $6.8 billion. Steelmakers responded by closing numerous marginal facilities. And production capability was cut by 13.6 Mt (15 million st). Capital expenditures still averaged $2 billion annually. But this was inadequate to maintain the existing base of steelmaking facilities. The general economy experienced a satisfactory recovery during this period. American steel, however, continued to suffer from a lagging recovery in the capital goods sector. This was due to record penetration of its domestic market by imports and from very weak realizing prices on the volume that was available. In addition to the direct influx of offshore steel products - which itself depressed prices - the industry also became painfully aware of the growing importance of "indirect" imports. These came in the form of steel-containing producer and consumer durables. Industrial equipment and autos fabricated from foreign steel accounted for the equivalent of 6 Mt (6.5 million st) of lost market opportunity for domestic steel-makers last year. That is over and above the 23.5 Mt (26 million st) of direct steel imports. Given these factors, Inland Steel was not spared from the threeyear downpour of red ink. Despite its record of continuing modernization in steel, our single-plant location in the world's best steel-consuming market, and the high proportion of consumer durables related products, such as cold rolled and coated sheet in our mix, Inland suffered aggregate losses of $277 million during the 1982-84 period. Strategic Planning The foregoing establishes a perspective - a base from which we have restructured our view of the steel industry, and of our own role within that picture. Until possibly two years ago, this present weakness in steel demand was viewed around the world as an aberration, eventually to pass. By contrast, it is now recognized that austere times are the normal steel environment. The topic here is management of resources. This implies an emphasis on strategic planning. It is worthwhile to examine some of the more critical assumptions that were driving strategies among a number of steel companies just before the 1980s. Those projected characteristics of the future steel environment were arrived at through painstaking analysis. They were carefully and heavily quantified and were generally shared by outside observers and our peers within the steel industry. • First, the assumption was made that domestic steel demand would continue to grow at an average rate of 2% per year. • Second, it was assumed that this growth in the American market would continue to be filled predominantly by US mills. It was believed that increases in steel and steel-related demand overseas would absorb much of the ominously growing capacity of third

Jan 6, 1985

By Sandy Clamage

"Seeing the elephant" was a term often heard from 1849 to 1859, the period of the great California Gold Rush. The phrase was used by those who dreamed of instant wealth that was believed could be found in California's virgin earth and mighty rivers. When news of fabulous gold strikes throughout the Mother Lode reached far away places, thousands of gold seekers left home and family to join in this incredible adventure. The barren, placid state of California soon became one of the most bustling, populous areas in the West. Before the Rush Before 1848, Mexico ruled California. It was then a remote region, isolated from the urbane world of the East by 2900 km (1800 miles) of scorching desert and impassible mountains. By sea, it was 29 000 km (18,000 miles) via Cape Horn. Spaniards and Mexicans settled the coastal lands on tracts donated to them by the Mexican government. The inland area was the domain of Indians and a few settlers who also had been granted estates by the government. Among those settlers was Captain John Sutter. He had been fortunate enough to obtain about 11 leagues of land (spanning 100 km or 60 miles in length) from Governor Alvarado of Mexico. Sutter was somewhat of a visionary and possessed a gifted tongue. He managed to receive most of what he desired with minimal trouble. Enchanted with Sutter's personality, Alvarado promised him Mexican citizenship. Alvarado also commissioned him to become "representative of the government and officer of justice on the Northern frontier." With uncanny foresight, Sutter began building a fortress on his land in the Sacramento Valley. It later became known as Sutter's Fort. It was more than just a fort, however. It also became a stopping place and home for many foreigners and Americans who traveled to California, and it eventually became the mecca for overland pilgrims. Sutter engaged in many projects. These included a cattle ranch, fur trade and trapping, and the construction of an irrigation system. With the influx of immigrants over the years, the community around the fort grew rapidly. Lumber was much in demand and Captain Sutter agreed to supply the necessary capital for a community sawmill. The site chosen was some 72 km (45 miles) northeast of the fort on the south fork of the American River in the town of Coloma. During the course of its construction, Sutter's carpenter, James Marshall, discovered a problem with the tailrace on the mill. First Strike Early in the morning on Jan. 24, 1848, Marshall was checking the tailrace. He noticed an object shining in a foot of water at the bottom of a ditch. He reached down and picked it up. His heart began to thump wildly as he realized he was holding a gold nugget. Sutter planned to keep the find a secret for as long as possible. He knew very well that he could become an extremely wealthy man. The ever loyal Marshall remained faithful to his employer and the pair did their best to obtain more

Jan 3, 1985