australia's identified mineral resources 2004 - Geoscience Australia

AUSTRALIA’S IDENTIFIED MINERAL RESOURCES 2004
Production and Resource Life
Australia’s production of selected mineral resources, concentrates and metals for 2003–04 are
presented in Table 4. Australian Bureau of Agricultural and Resource Economics (ABARE) reported
that minerals and energy commodities for which mine production rose significantly in 2003–04
compared with 2002–03 were manganese ore (up 24%), magnesite (23%), iron ore (12%), brown coal
(5%) and black coal (3%). More than half of Australia’s major mineral and energy commodities
recorded production decreases in 2002–03, the most substantial being for tin (down 77%), rutile
concentrates (26%), diamonds (24%), zinc (11%), copper (10%) and gold (6%).
ABARE reported that Australia’s export earnings from mineral resources fell to $52.2 billion in 2003–04,
a decrease of $2.8 billion or 5% compared with 2002–03. This weaker performance mainly reflected
lower prices for about 80% of the minerals and energy commodities exported, largely as a result of
the strong Australian dollar in 2003–04.
To sustain these export earnings and maintain Australia’s position as one of the world’s leading
minerals producers, resources need to be discovered and developed for production at rates sufficient
to meet demand. To facilitate assessment of the future supply capability of identified resources, ratios
of AEDR to current mine production have been provided in the commodity reviews above, as an
indicator of the resource life. This indicator can change quite rapidly, for example with significant
changes in production rates and metal prices. Iron ore provides a good example of how resource life
can vary markedly over a short period: increasing production in response to growing demand from
Asia, has been a major factor contributing to the iron ore resource life halving from 125 years in 1995
to 60 years in 2003.
AEDR of the other main bulk mineral commodities can sustain current rates of mine production
on average for the following approximate periods years: black coal 100 years, bauxite 90 years,
manganese ore 25 years, and brown coal 450 years. Ratios of AEDR to current mine production for
other minerals indicate a resource life of: nickel 120 years, copper 50 years, ilmenite 85 years, rutile
90 years and zircon 50 years.
The resource lives for gold (just under 20 years at current rates of production), lead (less than 30
years) and zinc (less than 25 years) are amongst the lowest. Gold price increases over many years
have contributed to increasing expenditure on gold exploration since 1980. Despite the fact that there
has been a progressive increase in Australia’s EDR of gold since the mid-1980s, there is still a need
for ongoing successful gold exploration in the short and medium terms to discover sufficient
resources to maintain gold as one of Australia’s main export commodities.
72
Similarly, there is a need for significant new discoveries of lead and zinc in the not too distant future
to sustain production of these commodities at current levels beyond the next 25 years, when almost
all existing base metal mines will have closed. In addition, there is usually a period of about 10 years
between the initial discovery of a deposit and the commencement of production for large lead-zinc
projects. The success of fine grinding technology has allowed the economic extraction of base metals
from the McArthur River and Mount Isa deposits and resulted in increases in EDR. However, there is
a need to discover and develop a high quality, metallurgically attractive lead-zinc deposit.