australia's identified mineral resources 2004 - Geoscience Australia

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AUSTRALIA’S IDENTIFIED MINERAL RESOURCES 2004 Subeconomic demonstrated resources of 57 Mt of magnesite remained unchanged from 2002. All of these resources occur in Queensland and Tasmania. Inferred resources decreased by about 6% in 2003 to 931 Mt with Queensland accounting for 50% of these resources followed by South Australia (31%) and Tasmania (16%). Accessible EDR Currently, all magnesite EDR is accessible for mining. JORC Reserves About 11% of AEDR comprise JORC Code reserves. The remaining represents resources assessed by Geoscience Australia from the measured and indicated categories of industry reported mineral resources, as defined under the Code and other classification systems used by companies not listed on the Australian Stock Exchange. At Australia’s 2003 rate of production, magnesite resources in the JORC Code reserves categories are adequate for 80 years. Exploration Data relating to exploration expenditure for magnesite are not published by ABS on either a state or national basis. Production In 2003, Australian Magnesium Corporation Ltd mined 3.02 Mt (2.14 Mt in 2002) of crude magnesite ore at Kunwarara, which was beneficiated to produce 470 038 t of magnesite (483 002 t in 2002). This in turn produced 108 190 t of dead-burned magnesia (102 785 t in 2002), 56 143 t of calcined magnesia (58 688 t in 2002), and 25 064 t of electrofused magnesia (19 582 t in 2002). The only other recorded production of magnesite in 2003 was about 2 600 t in South Australia. World Ranking According to Geoscience Australia and USGS data, Australia has about 5% of the world’s EDR of magnesite. Russia, North Korea and China, together, account for nearly 70% of the world’s EDR of magnesite. The Kunwarara deposit is the world’s largest known resource of cryptocrystalline, nodular magnesite, a high quality ore. Australia accounted for 4% of the world’s production in 2003. USGS data show that China (33%) and Turkey (17%) were the world’s largest producers, followed by North Korea and Russia (both 9%), and Austria (6%). Industry Developments Australia’s potential capability to produce magnesium metal changed markedly in 2003. In June, Australian Magnesium Corporation Ltd (AMC) mothballed construction of its $1.7 billion Stanwell magnesium plant near Rockhampton (Qld) due to a capital cost overrun and failure to attract a new corporate partner into the project. 44 AMC has reached an agreement with both the Australian and Queensland governments as stakeholders to exit their positions as secured creditors, extinguishing all their debts, and walk away with $46.4 million in cash, as well as the land on which the plant was to be built. The plant site will be reserved as a site for a magnesium plant for five years. AMC will continue the QMAG magnesia operation, which is a stand-alone business. Magnesium International Ltd (MIL) concluded an agreement with CSIRO to produce magnesium sheet metal using twin-roll casting technology developed by CSIRO. MIL announced a new strategy for the SAMAG project that would increase the planned production rate by 18% to 84 000 tpa. The aim is to construct the proposed smelter in two modules, with the first having a capacity of 41 000 tpa. When the first module is commissioned and production optimised, construction would commence on
AUSTRALIA’S IDENTIFIED MINERAL RESOURCES 2004 the second module. This strategy would reduce financial risks and provide operating revenue to reduce capital requirement for the second module. The South Australian Government reaffirmed its commitment to MIL’s SAMAG Magnesium Project at Port Pirie (SA) following a comprehensive review of the project, which included engineering, technology, capital and operating cost estimates, market analysis and the proposed financial arrangements. The government is to provide $25 million in infrastructure support to the project. By the end of the year, MIL was having discussions with a number of companies regarding the development of a power station near the site of the proposed smelter at Port Pirie with the final decision to be made early next year. MIL was investigating a new source of magnesite near Collaby, in the southern Flinders Range, 15 km from Port Pirie, as an alternative to the original supply from mines 250 km away near Leigh Creek. In 2003, Latrobe Magnesium Ltd (formerly Rambora Technologies Ltd) was negotiating with Alcan to use their magnesium extraction technology for its proposed brown coal fly ash tailings-tomagnesium project in the La Trobe Valley, Victoria. In May, the company signed a contract with Yallourn Energy Pty Ltd for the supply of about 320 ktpa of ash for the project. This contract together with arrangements already in place with Hazelwood Power has secured for the company sufficient feedstock to produce 75 ktpa of magnesium metal for a period of at least 20 years. Latrobe Magnesium Ltd is proposing to produce magnesium metal from fly ash produced by the La Trobe Valley power stations. The company commenced a bankable feasibility study in June 2003 that includes a plan to process 1.2 Mtpa of fly ash with a magnesium content of up to 12% to produce about 100 000 tpa of magnesium metal. Manganese Ore Manganese is a grey white coloured metal, resembling iron, but harder and very brittle. In nature, manganese occurs most commonly as the minerals pyrolusite (manganese dioxide MnO 2 ) and rhodochrosite (manganese carbonate MnCO 3 ). Manganese is the twelfth most abundant element in the Earth’s crust and the fourth most used metal after iron, aluminium and copper. The main uses for manganese are in the production of stainless and special steels and silico- and ferromanganese alloys. Over 90% of the world’s production of manganese is applied in the desulphurisation and strengthening of steel. Manganese is also used in the manufacture of dry batteries, as a colorant, and as an ingredient in plant fertilisers and animal feed. In Australia there are two operating manganese mines – Groote Eylandt (NT) and Woodie Woodie (WA). Manganese ore processing plants are located at Bell Bay (Tas) and Newcastle (NSW). Resources In 2003 Australia’s EDR of manganese ore decreased by 2.3% to 124 Mt mainly due to production. Both paramarginal demonstrated resources (23.1 Mt) and submarginal demonstrated resources (167 Mt) remained unchanged. Inferred resources also remained unchanged at 197 Mt. 45 Accessible EDR All manganese ore EDR (124 Mt) is accessible. The resource life is about 25 years at current rates of production of beneficiated manganese ore. JORC Reserves Manganese ore JORC reserves are 89 Mt (72% of accessible EDR). The resource life based on JORC reserves and at the current rate of production of beneficiated manganese ore is about 17 years.
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