Modern Mining September 2016


most of his working career (apart from a stint in Venezuela) in Africa. He joined Randgold in 2004 after having worked for a number of juniors in West Africa. He spends about half of the year visiting Randgold’s sites in Africa. Holliday makes the point that in recent years the annual rate of significant new gold discov- eries has plummeted down into probably single figures. “The harsh reality is that the industry is not replacing what it’s mining. As we speak, and assuming no further discoveries, the world only has about 11 years’ worth of gold reserves at present rates of gold production. The aver- age grade of new deposits has also halved in recent years – from around 2 g/t to 1 g/t. Despite all this, gold exploration budgets have been slashed around the globe. The gold min- ing industry will not have a future unless these trends are reversed.” The truism that there are no short cuts when it comes to exploration is demonstrated by the fact that Randgold has worked on around 1 500 targets over the past 20 or so years – with these delivering just a handful of deposits deemed worthy enough to be developed into mines. It should be stressed though that Randgold sets the bar high when it comes to evaluating orebodies. “What we regard as an economic deposit is one with at least 3 Moz of mineable gold with a minimum IRR of 20 % at a long- term gold price of US$1 000/oz,” says Holliday. “Obviously, viable mines can be developed from much smaller orebodies but this is not the space we’re in – we’re focused only on world- class deposits.” Currently Randgold’s exploration effort – which targets the greenstone belts of West and Central Africa – consumes around US$50 mil- lion a year and is carried out by approximately 80 graduate geologists, most of them drawn from the countries in which Randgold operates. “We don’t have many expatriate geologists,” says Holliday. “Given the wealth of local talent available in Africa, we don’t see any need for them. Many of our geologists have been with us for many years and some have migrated into positions of senior management at our mines.” Detailing Randgold’s current explora- tion activities, Holliday says expenditure is divided evenly between greenfields and brownfields programmes. “In terms of green- fields exploration, our priority areas in West Africa are the MTZ (Main Transcurrent Shear Zone) in Senegal, the Senegal-Mali Shear in Mali, and the Boundiali and Senefou belts in Cote d’Ivôire, while in the north-eastern DRC – where our Kibali mine is located – we are concentrating on the 35 km-long KZ structure,

which is a terrain boundary hosting multiple plunging orebodies. The total portfolio contains 137 targets, all of them at varying levels in the resource triangle model which we use to guide our exploration and development plans.” Elaborating on the resource triangle, Holliday says that Randgold’s generative work ensures a constant supply of targets to the base of the triangle. “We apply a set of filters at progressive levels within the triangle which allows us to promote quality targets and reject inferior ones,” he explains. “At any one time, most of the projects will be in the lower part of the triangle with only a small number making it through to the top. If we look at the current triangle, of the 137 projects, 64 are classified as

A helicopter-borne Versatile Time Domain Electromag- netic (VTEM) airborne survey underway in August this year over the Ngayu greenstone belt in the north- eastern DRC.


September 2016  MODERN MINING  39

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