Abstracts 2006


January 2006 Technical Presentation
Worldwide Uranium Resources
Dr. Karen J. Wenrich
Wenrich Consulting for U
63 S. Devinney St., Golden, CO 80401
303-278-1574, CrystalsUL@aol.com

The uranium industry has made a dramatic turn-around in the past two years that even the most optimistic economist was not willing to predict during the uranium downswing of the 1990s. Uranium reached a 30-year low in February 2001 of $6.50/lb. By the end of November 2005 it had soared to $34.50/pound. This nearly 600% increase in the uranium spot price within 4 years dwarfed the increase in gold price that hasn?t even mustered a 100% increase. The initial slow rise from $6.50 in February 2001 to $10.75 in April 2003 was primarily driven by the decrease in the value of the dollar. Since then several factors have contributed to the soaring price:

(1) The awakening of many to the simple fact that uranium supply has not met demand for several years and that the world's stockpiles are being drawn down.

(2) How sharply this fragile supply can be impacted by disasters at the world's major uranium production facilities, such as:

a) The flooding of the McArthur River Mine in the spring of 2003

b) Fires at Olympic Dam

c) The potential that Rossing, with an annual capacity of 4000 tU might close by 2007.

(3) The withdrawal of Tenex from the HEU (highly enriched uranium) feed agreement, and (4) the announcement by the Chinese of their intent to build 30 new nuclear reactors.

As the price of uranium fell during the 1990's conventional mining and milling essentially closed in many of the world's uranium districts. ISL (insitu leach) mining of sandstone deposits became the major focus of uranium production for much of the world, including China. For most of these ISL deposits the average grade is very low, commonly less than 0.05% U3O8. Such low-grade sandstone deposits in Kazakhstan have been touted as containing 18% of the world's uranium resources. However, one of the speakers at the 2005 Northwest Mining Association's uranium short course in early December indicated that a cut-off of 0.01% U3O8 is being used and he felt "someone will eventually wake up to the economics."

The leading uranium producers in recent years have been the unconformity deposits in Canada, such as McArthur River with an average grade of 19.6% U3O8, and the Ranger deposit in Australia with an average grade of 0.23%. Although the Olympic Dam breccia complex deposit in Australia is low grade, 0.05%, its total resources are enormous and the economics of the deposit are vastly improved by the fact that it is a byproduct of copper (average grade of 1.5%) and gold (0.5 g/t). Something that these major uranium producers have in common is a breccia host rock. The highest-grade uranium deposits in the USA (average grade close to 1%) occur in a breccia environment in northern Arizona.

Because these breccia pipe ore bodies are commonly exposed in 3-dimension, much is known about them. Understanding the dynamics of their fluid flow systems, their uranium reductant, and their tectonic stability provides provocative insight into global uranium ore genesis and exploration. This becomes particularly intriguing with the recognition that these USA breccia pipe deposits and Canadian unconformity deposits have the following features in common:

• breccia

• bitumen

• base metals.

• high salinity ore fluids

• structures that connected multiple aquifer horizons

• desilicification.


February 2006 Technical Presentation:
The Haquira SX-EW Copper Deposit, Las Bambas District, South-Central Peru.
J.E. Black, President and CEO, Antares Minerals Inc., 8723 Fairview Oaks Ln, Lone Tree, CO 80124,
W.C. Williams, Vice President, Phelps Dodge Exploration, 1 N. Central Ave., Phoenix, AZ 85048,
and C.Rio Frio, Senior Geologist, Phelps Dodge Exploration, 1 N. Central Ave., Phoenix, AZ 85048.

The Haquira Project hosts a large porphyry copper deposit with well-developed copper-oxide and secondary copper-sulfide mineralization overlying primary copper-sulfide mineralization. The project is located approximately 75 km to the southwest of Cuzco, Peru in the emerging middle Eocene to early Oligocene Andahuaylas-Yauri copper-gold porphyry/skarn belt which hosts the Tintaya copper-gold skarn mine (BHP Billiton), the Las Chancas copper-gold porphyry deposit (Southern Peru Copper Corp.),the Las Bambas copper-gold skarn deposits (Xstrata Copper), as well as numerous other copper-gold-molybdenum porphyry and skarn occurrences. The Haquira project is contiguous with, and immediately to the south of, the Las Bambas District where Xstrata Copper has committed to invest US$121 million.

The Haquira project is a grass-roots discovery made by Minera Phelps Dodge del Peru S.A.C.("Phelps Dodge"). Antares Minerals Inc.("Antares"; ANM-TSX.V) can acquire a 100% interest in the Haquira project from Phelps Dodge by completing optional payments totaling US$15 million over a five-year period.In addition, once a feasibility study is completed on Haquira, Antares will be obligated to make an additional payment to Phelps Dodge equal to US$0.01 for each pound of copper in excess of 2.2 billion pounds that is calculated as part of the leachable mineral resource. Antares has also issued 1.5 million warrants to Phelps Dodge.

Copper mineralization at Haquira occurs within quartzites and siltstones of the Cretaceous Soraya Formation and a Tertiary multi-phase porphyry dike swarm. Magma emplacement and mineralization occurred during a period of intense deformation, crustal shortening, and regional uplift broadly synchronous with the Incaic orogeny. Phelps Dodge discovered two principal areas of mineralization; the western area (1500 by 1000 m) and the eastern area (500 by 1000 m). Mineralization in both areas remains open in several directions. The mineralized zones are oxidized to depths varying from several tens of meters to more than 200 meters deep. Secondary copper mineralization consists primarily of black and green copper-oxide minerals with lesser amounts of secondary chalcocite near the base of oxidation. The underlying primary mineralization has not been well-explored and consists of stockwork quartz-chalcopyrite-pyrite-molybdenite veins and disseminated sulfides.

Sequential leach-copper analyses have been completed by Phelps Dodge at the Cerro Verde analytical laboratory and at the SGS laboratory in Lima, Peru for most of the mineralized intervals to evaluate the leachability of copper-oxide and secondary copper-sulfide mineralization. These analytical results indicate the mineralization is amenable to conventional SX-EW processing.

Antares recently announced the completion of an independent National Instrument 43-101 compliant mineral resource estimate for the Haquira project. The estimate was prepared by Chlumsky, Armbrust, and Meyer L.L.C., ("CAM") of Denver, Colorado, USA and was based upon 85 drill holes (11,350 m) completed by Phelps Dodge in 2001-2003. The CAM report estimates an inferred mineral resource, at a 0.3% total copper cutoff grade, of 120.5 million tonnes grading 0.49% copper amenable to SX-EW processing (secondary copper sulfides and oxides) and 89.2 million tonnes grading 0.43% copper amenable to flotation/concentrate processing (primary copper sulfides) for a total of 209.7 million tonnes grading 0.46% copper. All resources at Haquira are currently classified as inferred mineral resources due to the relatively wide average spacing of 200 m between drill holes. Antares is currently completing a 6,000 meter drilling program to expand this resource base.


March 2006 Technical Presentation
Industrial Minerals and the Exploration Geologist
William Langer
USGS Box 25046 MS 973
Denver, CO 80225-0046 303.236.1249 blanger@usgs.gov

Industrial minerals are essential resources for modern society. Their applications range from such fundamental uses as construction of roads, bridges, and buildings; to operations such as drilling for oil and gas; to military applications; to their use in nearly every consumer product. The need for industrial minerals tends to grow commensurate with our population and economy.

Most geologists accept the simple definition of an industrial mineral in the American Geological Institute Glossary of Geology, which is: "Any rock, mineral, or other naturally occurring substance of economic value, exclusive of metallic ores, mineral fuels, and gemstones." Yet the definition is incomplete because industrial minerals sometimes include manufactured products such as cement and lime, and include some metallic minerals with industrial applications such as bauxite and ilmenite.

Putting debates over definitions aside, the good news is there is plenty of work for exploration of industrial minerals waiting to be done. There are more than 60 industrial minerals that can be organized into 7 broad categories; 1) agricultural minerals, 2) ceramics and refractories, 3) chemical raw materials, 4) construction materials, 5) fillers and pigments, 6) sorbents, filters, and process aids, and 7) specialty minerals.

During 2004, the value of US production of industrial minerals (including aggregates) was more than triple the production of metals. The value of US raw non-fuel mineral production was estimated at $47 billion: metals accounted for 23 percent of the total mineral production; aggregates accounted for 35 percent of the total; and other industrial minerals accounted for 42 percent of the total.

The bad news is the work to be done is NOT geologic-exploration-as-usual. Industrial minerals are a highly diverse group of minerals. Consider value--Common construction materials, such as crushed limestone, may sell for $10 dollars per ton or less. Rare earths may sell for $6,000 per ton. Industrial diamonds, which sell by the carat for as much as $200 per carat, may reach a value approaching $1 million per ton. Neither metals nor fuels contain categories that differ in price by over 5 orders of magnitude.

Even within one community, prices may vary significantly. The same crushed limestone mentioned above that sells for $10 per ton may command a price approaching $100 per ton if calcined into lime, and a price approaching $1,000 per ton if manufactured as very fine high-purity precipitated calcium carbonate.

The diversity of industrial minerals impacts how one conducts mineral exploration. Unlike geologists who work with metals, and may lose interest by the time the bars of metal are produced, those in the field of industrial minerals cannot afford indifference to the final product. Specifically, the physical and chemical properties of industrial minerals carry over into the final application of the commodity. A simple material such as limestone must posses certain general physical and chemical properties in order to be acceptable for use, even as crushed stone. Crushed limestone used as a basic raw material for cement production requires rock with very specific chemical properties; and putting it to an even more demanding use, such as chemical or pharmaceutical applications, requires extremely rigorous specifications. By evoking more demanding applications, one eliminates large areas of rock from consideration for use. The successful exploration geologist will be able to translate product requirements into geologic properties of the industrial minerals, and will be able to predict those properties through traditional geologic techniques.

Industrial minerals are global commodities. The last US asbestos mine closed in 2002; now 100 percent of the country's asbestos is imported, most of it from Canada. Also in 2002, the last US rare earth mine closed; now 100 percent of our rare earths come from other countries including China, Japan, France and Estonia. Even when we have operating mines, we still are dependent on foreign sources. We have drop-dead gorgeous rock in the US, yet 85 percent of our dimension stone is imported from countries such as Italy, Spain, India, and Brazil. Most of the barite mined in the US comes from Nevada, but over three fourths of the barite we consume comes from China and India. Three fourths of our iodine comes from Chile, Japan, and Russia. A third of our garnet comes from Australia, India, and China. Even a few percent of high bulk, low value aggregate resources are imported from Canada and Mexico. Importation is not necessarily due to lack of occurrence in the US; it can relate to economic, societal, and environmental factors. In many instances the location and characteristics of the extraction site of an industrial mineral is as important as the deposit itself. The successful exploration geologist will take all these issues into account when searching for viable industrial mineral deposits.


Abstracts for April 2006 Technical Presentations:
These 2 presentations were sponsored jointly by the Colorado School of Mines and Denver Region Exploration Geologists' society.

About Our Speaker -


Michael Doggett is an associate professor and director of the mineral exploration Master's program in the Department of Geological Sciences and Geological Engineering at Queen's University, Kingston, Canada. His teaching and research focuses on economic analysis of mineral exploration and acquisition, both at corporate and industry-wide levels. Dr. Doggett also serves as a consultant for mining companies, governments and international agencies.

April 2006 Noon Technical Presentation

Exploration in the context of mineral supply-Focus on Copper
Michael Doggett

The demand for mineral commodities has increased significantly over the past several decades and is projected to continue to rise for the foreseeable future. As known mineral deposits are exploited, the pressure to find replacements drives the exploration process. All things being equal, depletion of easy to find, close to surface, close to market deposits results in higher costs and lower chances of success in the exploration process.

Fortunately, technology works to offset the affects of depletion through enhanced exploration tools, improved mining and processing techniques, and new scientific models. The global copper industry makes an excellent case study of the inter-relationships among production, depletion, exploration and technological advances. Productivity increases related to new technologies have allowed copper producers to meet increased demand while lowering real costs and price. The major question facing the copper industry is whether this trend is sustainable. Can technology continue to offset depletion in the context of increasing global demand for copper and maturing exploration environments?

April 2006 Evening Technical Presentation
Overcoming the odds: Why continue to explore?
Michael Doggett

Notwithstanding the extraordinary profits generated in the mining industry over the past few years, the expected long-term return to exploration for the industry as a whole appears to be marginal at best. If this is the case, then a number of questions need to be asked: Why are billions of dollars spent on mineral exploration every year? Does mining company management act in the best interest of shareholders by spending this money? Should companies stress the addition of mining reserves by acquisition rather than exploration? This presentation uses a series of case studies to address some of these fundamental issues associated with mineral exploration.


May 2006 Technical Presentation
Sediment-hosted zinc deposits in northern Alaska:
Controls on deposit formation and implications for exploration
Karen Kelley
Research Geologist
United States Geological Survey

The Red Dog and numerous other deposits hosted in sedimentary rocks have reserves and resources totaling 140.6 Mt (avg. 16.6% Zn and 4.6% Pb), which surpass most deposits worldwide in terms of grade and size. The barite resources are also extraordinarily large (estimated 1 billion metric tons). The sulfide deposits underlie and/or spatially overlap the barite, but sulfide-barren barite deposits also exist. Barite and sulfides were deposited at ~338 Ma in a rifted restricted basin flanked by carbonate platforms along a passive continental margin. Barite and sulfides formed by deposition in organic-rich muds and through subseafloor replacement of carbonate within the Late Mississippian Kuna Formation.

Multiple coincident factors in the evolution of the sedimentary basin were favorable for formation of the deposits. The Kuna basin was large (200 x 600 km) and was bordered by carbonate platforms on three sides, which limited input of siliciclastic material and preserved organic carbon that likely served as a reductant during mineralization. Mississippian extension and related horst-and-graben architecture is manifested by strong facies variability between coeval units. The deposits at Red Dog are superimposed upon a NNW-trending facies boundary defined by abrupt lateral thickness changes in shale and turbidite units. The climate may have been arid, leading to evaporation of seawater, production of brine, and availability of marine sulfate for barite formation. Initiation of mineralization coincided with regional drowning of the outboard carbonate platform in Late Mississippian time, presumably as a result of extensional tectonism/subsidence. Methane was transported with barium into shallowly buried sediments, and H2S was produced by anaerobic methane oxidation. The production of H2S may have been orders of magnitude faster than during normal organic matter decomposition. The implied high H2S production rates may have led to efficient precipitation of metals as sulfide minerals and, thus, may explain the high grades of the zinc deposits.

Geochemical analyses for major, trace, and rare earth elements (REE) for altered and mineralized rocks from the deposits show high Tl, Sb, As, and Ge, and uniformly positive Eu anomalies (Eu/Eu* >1.0), including for base-metal poor samples. Analyses of stream sediment samples collected in the vicinity of the shale-hosted deposits mimic the whole rock results, with elevated Tl values (2 to ~15ppm) in proximity to mineralized areas, typically with corresponding elevated Zn and/or Pb. The systematic hydrothermal dispersal in the district that is shown by Tl makes this a promising geochemical exploration guide for Red Dog-type Zn-Pb-Ag deposits elsewhere.


September 2006 Technical Presentation
Coarse Gold and Diatreme Volcanic Vents at the Recent Spring Valley Discoveries Pershing County, Nevada
By Paul Schmidt, Consultant, Morrison, Colorado

The Spring Valley project is located in the Humboldt Range, 20 miles northeast of Lovelock, Nevada and three miles north of the Coeur Rochester mine. Historic placers in the gulch draining Spring Valley were some of the most productive in Nevada, with estimated production of over 100,000 ounces gold. Drilling by Midway Gold and previous operators has identified a gold deposit beneath 50 to 300 feet of alluvium.

The main host for mineralization is the basal part of the Rochester rhyolite, a highly variable package of intercalated lithic tuff, welded tuff, flow banded rhyolite, and spherulitic rhyolite that is part of the Permo-Triassic island arc volacanic rocks of the Koipato group. Drilling identified the northeast-trending margin of a large diatreme with superimposed breccia pipes near its margin. The diatreme and breccias consist of large rounded to sub-angular fragments of local and exotic volcanic and sedimentary rocks set in a rock flour matrix. A distinctive welded tuff and overlying tuffaceous siltstone appear to have been erupted from the secondary pipes. Large blocks of welded tuff have dropped over 200 feet into the collapsing breccia of these later pipes. Porphyry sills and dikes are intruded along the margin of the diatreme.

Quartz vein-hosted gold mineralization has been identified along strike for more than 2500 feet and to depths of over 1000 feet. Quartz-tourmaline veins and stockwork are present within strong quartz-sericite alteration zones. These cut early-disseminated tourmaline alteration. Gold occurs in: 1) a hydrothermal breccia in the Pond zone; 2) in stockwork veinlets cutting porphyry along the diatreme margin in the Sill zone; and 3) in stockwork veins and breccias cutting altered rhyolite and latite porphyry in the Porphyry zone.

Coarse gold, up to 3 mm across, has been observed in reverse circulation drill cuttings. Midway Gold has developed a simple procedure to identify and determine location and grade of the coarse gold areas, with a modified sluice attached to a standard reverse circulation drill. This allows analysis of a gravity concentrate from a much larger sample than is normally collected in reverse circulation drilling.


October 2006 Technical Presentation
Geochemical Perspectives Concerning Certain Uranium Deposits
Sam Romberger, Professor of Geology, Colorado School of Mines

We have not received an abstract.


November 2006 Technical Presentation.
Modeling Exploration Decision Making in a Value-creation Framework
Graham A. Davis
Professor of Economic and Business Development
Colorado School of Mines
and
Michael Samis
(AMEC Americas)

Two main uncertainties face an exploration manager: geological uncertainty and price uncertainty. Our modeling of exploration decisions under a value maximization framework reveals important differences between exploration strategies for commodities such as gold, which exhibit reversion to a mean price level and saturating future price uncertainty.

Under a value-maximizing policy gold exploration should, during periods of low and prices, focus on promising greenfields deposits and deposits with previous positive exploration results while deferring geologically unpromising greenfields prospects until prices improve. This is because given gold's random walk price, characteristic, there is always a chance that higher and higher gold prices could make up for poor geological potential. An expanded exploration policy that includes the deferred greenfields prospects is warranted when prices are higher.

On the other hand, our model suggests that unpromising greenfields copper projects should not be kept in deferral mode during low prices, since future prices are capped by the trend of copper prices to a long-run mean. Greenfields copper projects should, therefore, either be explored immediately if promising, or permanently abandoned, if unpromising, regardless of current copper price. That optimal exploration policy depends on the commodity, brings to light the importance of modeling both geological and economic (price) uncertainty when valuing and managing exploration projects.


December 2006
The Schellgaden mining District, Central Austria a Strata-Bound Au-W deposit in the Eastern Alps
Miles L. Silberman, M.L.S Consulting, Golden, Colorado USA
and
Hans R. Klob, HRK International, San Francisco, California USA

In the Early Paleozoic, now epi-metamorphosed and deformed volcanic and sedimentary rock sequences were deposited in a series of elongate, E-W trending belts in the eastern Alps. Mafic volcanic activity across the entire region and ended by the close of the Ordovician Period (Holl and Maucher, 1976). During this volcanic activity, a complex assemblage of strata-bound, syngentic ore deposits were formed. These deposits include sediment hosted Pb-Zn (plus, minus barite, fluorite), volcanic-hosted Cu-bearing massive sulfide, scheelite (plus, minus arsenopyrite), stibnite, and cinnabar deposits. Most deposits are exhalative and occur in E-W trending belts of specific type associated with some of the lithologic belts, although considerable overlap of deposit types does occur. The scheelite and stibnite varieties can have significant gold content. These deposits are the earliest stage of the complex metallogenic evolution of the Alps.

Schellgaden is located in central Austria, south of Salzburg partly in Salzburg and partly in Carinthia provinces. It is an example of the scheelite- type of strata-bound deposit classified by Holl and Maucher (1976) but was mined principally for Au. as early as the 1350s and intermittently after that into the 1920s. The district covers an area of approximately 30 km north-south and 4 km east-west. Many ancient and recently active gold mines occur throughout the district but the two most recently active and largest mines are located in the northern most part.

The host rocks at Schellgaden are part of the Penninic basement exposed in the Tauern window. The structural setting is much simpler than that of the overriding nappes, although there is considerable faulting. The host rocks are a 1000 meter thick sequence of metamorphosed volcanic and volcaniclastic rocks that are now greenschist, black (carbonaceous) schist, calcareous schist, mica schist, gneiss and amphibolite. Gabbro and serpentinite are also present. The host rocks contain two types of ore deposits. The most common type is stratiform, lensoid layers of fine to medium grained, granular quartz a few centimeters to 2 or 3 meters in thickness. These occur as multiple layers in schistose zones that form continuous horizons, termed "lagers" that are parallel to bedding. The lagers are two to 25 meters thick and are continuous along strike for hundreds of meters. A less common type of ore is discordant quartz veins that are similar in texture and mineralogy to the strata-bound quartz layers. The host rocks that contain the mineralization vary throughout the district, and even within individual mines, but the character of the ore is very consistent.

The quartz lenses contain gold, pyrite, galena, and chalcopyrite or bornite in bands or layers. Scheelite is present in some lagers, but not in others. Tourmaline may also be present in the quartz, but does not co-exist with scheelite. Gold is free milling and associated with pyrite and galena. The ore contains Au, Ag, Pb, Cu, +/- W. Zinc, As and Sb, are low, and the As and Sb contents are generally below 20 and 10 PPM, respectively.

The largest mine, the Stubelbau has three separate lagers, each with multiple quartz horizons. It has 8 km of workings. The lagers are continuous in exposures that are 800 meters by 300 meters, and have an average grade of 10 PPM Au. The results of limited diamond drilling in the northern part of the district near the Stubelbau indicate the presence of at least 8 lagers over a depth of 300 meters. The same style of mineralization occurs over the entire 80 square kilometers of the district and only small parts of it have been recently explored. There is potential for a major gold occurrence at Schellgaden.