A Geosoft Publication www.earthexplorer.

com June 2012

Applied Techniques Technology Featured Explorers

Underwater electromagnetic Geophysical inversion Aqua Survey, Bowgan Minerals, Eni,
survey recovers Amityville weapon modelling in the cloud Miranda Gold, Murrumbo Limited, Paterson,
Grant & Watson, Trelawney Mining

Cover Story

Risky
Feature Articles
Quick, Find me

Business a Target
When good ground
control is indispensable
Balancing the risk and
rewards in greenfields Deepwater Oil
Eni’s expertise in deep
exploration offshore oil exploration
{ With the rising complexity of earth exploration, geoscientists and exploration companies
}
are challenged to explore more effectively to keep pace with project and industry
demands. Geosoft software solutions help you maximize the value of your data, people
and technology for greater discovery success.
Geosoft supports you through every stage of exploration, enabling you to quickly
transform data into three dimensional insight for decision-making. Simplify complex
earth data challenges. Spend less time sifting through data. Drive efficiencies. Gain
more freedom to explore.
Simple, powerful and made for earth explorers.
Discover with Geosoft. | www.geosoft.com
contents
Earth Explorer is dedicated to covering
the people, techniques and technologies
that contribute to the success of earth
exploration. It is sponsored by Geosoft Inc.

Editorial

Editor
Carmela Burns
earthexplorer@geosoft.com

CEO
Tim Dobush

Chief Technologist
Ian MacLeod

Directors, Product Management

Louis Racic
Steve Randall

6 4 News and Views

CONTRIBUTING WRITERS
Seeing the shades of grey in 3D inversion.
Dan Zlotnikov

7 Quick, find me a target Graham Chambers, PhD

In a rush to drill, explorers may overlook the Virginia Heffernan, M.Sc.

structural geology.
PHOTO GRAPHS COURTESY OF

12 Risky business Aqua Survey

Bowgan Minerals
Balancing the risk and rewards in greenfields
Centre for Exploration Targeting
exploration.
19 Christina McCarthy

16 Sourcing regional data

Hernan Ugalde
Miranda Gold
Government data serving greenfields explorers.
Neil Briggs
Ontario Geological Survey
19 Redefining the mineral search space Trelawney Mining
Greenfields-related research aids industry efforts to
look deeper. DESIGNERs

Elena Zilberchteine
21 Offshore oil prowess
GEOSOFT INC.
21 Eni’s expertise in deep offshore oil exploration.
Corporate Headquarters
Queens Quay Terminal
24 Explorer profile 207 Queens Quay West
Christina McCarthy, Euro Pacific Canada. Suite 810, PO Box 131
Toronto, ON Canada M5J 1A7
Phone: +1 (416) 369-0111
26 Amityville weapon resurfaces Toll-free: 1-800-363-MAPS
A second weapon is recovered with marine Fax: +1 (416) 369-9599
geophysics. Email: info@geosoft.com

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Join the network Geosoft Europe Ltd.
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 News and Views

CET fine-tunes exSim

exploration simulator

R esearchers at the Perth-based Centre

for Exploration Targeting (CET) are
developing an exploration simulator
for training purposes. The aim of exSim is to
improve the performance of explorers through
simulated training.
ExSim software features an easy-to-
use interface which allows explorers to test
strategies based on different deposit styles. In
the process, users become familiar with various
exploration practices.
The new tool provides a simulated
environment in which decisions at all levels can be
tested by means of user interaction and graphics.
ExSim can be used in greenfield ground selection,
collection of survey data, targeting, and drilling.
Depending on the specific training
objective, the user is given knowledge of the
type of mineral deposit being explored and of
the general area, plus a budget,
a schedule, and several low-
resolution datasets. He then
tests exploration strategies by
collecting additional data and
interpreting the results.
Magnetic, gravity, or 3D block
models are used to determine
how effectively the user has
designed the surveys and understood the area. customized scenarios, interpretive assistance,
ExSim functions as a survey tool (allowing and survey planning. The software also has
for the selection of a survey type and the potential as a research tool inasmuch as collected
design of the selected survey), an interpretation information on how a user interacts with data
tool (allowing for the annotation of the user’s can help determine the value of the data.
interpretation of survey area), and a user
monitoring tool (allowing for the collection Read the full article at Earthexplorer.com.
and storage of data over the course of the
exploration scenario).
Potential applications include designing

Video tours of new features in the

Geosoft 2012 software release

V ideos of new features in the Geosoft

2012 software release are now
online. The videos review the latest
improvements to Oasis montaj, GM-SYS, Target
and Target for ArcGIS, as well as the new cloud-
based Geosoft VOXI Earth Modelling, which
generates 3D voxel models from airborne or
ground gravity and magnetic data.
Resource explorers and earth scientists will
benefit from 2D and 3D workflow enhancements
and new capabilities. “The 2D to 3D workflow is
an important one to get right, and a particular
challenge for geoscientists working across GIS
and exploration software platforms. Bridging the
gap between 2D and 3D is a
key improvement area within
our 2012 Software Release.” says
Louis Racic, Geosoft’s product
director.
The 2D-to-3D workflow
enhancements in Target
for ArcGIS include display
c a p a b ilit ie s a n d s e c t io n
import and export options.
Interpretation layers from
sections or plans can now
be easily displayed in their
correct geospatial orientation
within 3D view. 2D section interpretations can
be exported to a 3D geo-referenced file to be
shared with other 3D applications.
Geosoft’s 3D gridding methods have been
expanded to include inverse distance weighting
and direct gridding; these new methods support
the 3D gridding of a broad range of data types.
Another highlight is expanded GM-SYS 3D
density model support. Voxels can be used to
define the 3D density variation within GM-SYS
3D model layers, resulting in better integration
with 3D seismic data.
As well, geoscientists can now add satellite
imagery to their basemaps by connecting to the
Bing Maps online data source.
More information on the Geosoft’s 2012
software release is available at Geosoft.com.
The videos are available online at
www.geosoft.com/videos.

Earth Explorer site now indexed

on SearchMining.net

E arth Explorer magazine is now indexed

on Search Mining. SearchMining.net is a
free vertical search engine dedicated to
the mining industry. By only indexing websites
that are mining related, SearchMining.net
professionals in their daily work. The toolbar is
also available as a free download.
SearchMining.net was developed by
Aspermont, the publisher of MiningNews.net,
Mining Journal and Mining Magazine.
provides quick and relevant results for industry

4 Earth Explorer News and Views.

 Seeing the shades of
grey in 3D inversion
By Virginia Heffernan

U
sing 3D models of the subsurface derived from
geophysical data is standard practise for guiding
exploration in the petroleum industry and has the
potential to improve success rates for mineral explorers.
But because geophysical inversion models can
provide the same response for different geological
scenarios, they can introduce ambiguity into the resulting interpretation.
The latest thinking, and technology, has focused on the key factors
required to generate 3D models with greater ease and confidence,
making their output more reliable and informative as an aid for
mineral exploration.
Topping the list of requirements is the ability to integrate as many
constraints as possible - including gravity and magnetic data, surface
geology and borehole logs. The resulting complete earth model is more
likely to pick up nuances in physical rock properties and provide a truer
rendering of what lies beneath the surface.
“We’ve got to start thinking about the shades of grey,” says Dr. Bill
Morris, a 3D modelling expert and professor at McMaster University’s
School of Geography and Earth Sciences. With direct detection of ore
bodies becoming increasingly rare, geoscientists must “get past the
bull’s eye approach and, instead, put all our little clues together to
get the big clue,” he says. “We need to have more physical property
databases, and we need to be able to link physical property variations
to geological reality.” Geological map for Baie Verte Peninsula overlain on greyscale image of
Eventually, as the number of constraints in inversion models aeromagnetic data. Numerous disagreements between trends in magnetic
increases, geoscientists will be able to map regions of alteration in data and geology suggest map needs revision.
proximity to ore bodies, Morris and his co-authors predict in a recent
paper entitled Integrating geological constraints in geophysical models.
From the technology side, the ability to rapidly create, modify,
iterate and combine data within project timelines is essential for making
geophysical modelling a more practical and reliable aid for exploration.
The challenge has been developing lighter workflows for what
are currently resource and time intensive modelling algorithms. While
3D inversions using voxel earth models have been available for years,
it takes highly trained specialists with powerful computing capacity to
produce them. And the associated workflow required to define and
introduce constraints is time-consuming.
The newest inversion modelling technology, introduced by Geosoft
in April, was developed under the lead of modelling expert Dr. Robert
Ellis, a co-founder of the UBC Geophysical Inversion Facility, and relied
on input from industry collaborators to address these challenges.
Usability and “lighter workflows” were the primary drivers in the
development of VOXI, which also harnesses cloud computing to allow
geophysicists to work with ever-larger models.
In a recent post in the Exploring with Data blog, Chief Technologist
Ian MacLeod tells the development story behind the cloud-based Orthographic projection shows results of 3D geological models of the Baie
VOXI Earth Modelling service that took over three years and required Verte Peninsula developed from individual GM-SYS profiles and how they
the work of 29 people to create. VOXI provides tools for making intersect with one another. (Bill Spicer, MSc Thesis, McMaster University)
interpretation of 3D inversion models faster, more accurate and
accessible to a broader range of explorers, and includes a new
Magnetization Vector Inversion (MVI) technique.

Read online at www.earthexplorer.com Seeing the Shades of Grey in 3D inversion. Earth Explorer 5

VOXI Gravity Inversion, Podolsky Ni deposit, Canada. Known deposit is in purple.
At left, unconstrained VOXI gravity inversion produces high-density
feature in green.
At right, gravity inversion constrained by the magnetic inversion using VOXI
Iterative Reweighted Inversion method shows more accurate high-density
location in pink and yellow. (Gravity Case Study of the Podolsky Deposit,
Sudbury Basin: Elizabeth Baranyi, Dr. Robert Ellis)
Portiguar Basin, Brazil: VOXI inversion of magnetic data with weak fault
discontinuity interpreted from seismic section produces a geologically
consistent magnetic property model. (Non-Uniqueness in Potential Field
Inversion: Dr. Robert Ellis)
The service allows geoscientists to convert magnetic and gravity
data directly into 3D models that can be integrated with other project
data. Better yet, they can do this in the cloud using Microsoft’s Azure
cloud computing platform rather than relying on the limited processing
power of their own computers. “Building a multi-core cloud-based
algorithm is very different from building a program that runs on a
workstation or local cluster,” says MacLeod. “The effort to re-engineer
VOXI for Azure took us most of a year to get right.”
Making the software usable is a challenge in its own right, notes
MacLeod in his post. “We worked very hard with our collaborators
over two years to design and improve the VOXI interface,” he says, “so
that everything would work as smoothly as possible and fit within an
explorer’s natural workflow.”
Speed in generating 3D inversions is one of the essential ingredients
that will allow geoscientists to use these tools routinely, enabling them
to iteratively improve models as they add constraints and learn more
about their projects.
One early adopter says a modeling exercise that took him four
hours to complete using his current desktop modelling program, took
just two minutes using the VOXI service.
The future of mineral exploration using 3D inversion models
looks even brighter under the lens of better and more plentiful data
sets that can be used to constrain inversions, especially borehole
geophysical data.
“We have a whole suite of new tools that are giving us information
that we have never received before,” say Morris. “The other big key is
that we are now seeing integrated geological and geophysical model
development platforms.”
This will allow geoscientists to move more comfortably between
the three main geophysical models (discrete body, lithologic surface
and voxel mesh inversion), incorporating elements of each one into a
fully constrained inversion.
“The systematic use and development of 3D models for each
mining camp will certainly lead to the discovery of new resources in
many of the older mining camps,” he predicts. o

BOOK review

Mapping Alaska: an explorer’s journey

By Daniela Galloro

T
here was no path to guide field mapper
Mary Albanese through the Alaskan
wilderness. Only brush, trees, and rocks—
an unchartered, seemingly endless stretch of
rocks. Her memoir Midnight Sun, Arctic Moon:
Mapping the Wild Heart of Alaska is the story
of Albanese’s life and journey as an arctic
geological explorer.
The book chronicles her survival against the
Alaskan elements and the extreme conditions
of a remote explorer. A strong undercurrent is
Albanese’s connection with rocks, and passion
for the region’s rock formations. “Rock units are
the building blocks of the earth’s crust, intricately
merged together to provide the solidity in our
world,” says Albanese. “Most people don’t ever
think of it that way, but it’s true. I like rocks for
their strength as well as their secrets and their
truth. The rocks never lie.”
Deciphering the geological history of Sugar
Loaf Mountain, Jumbo Dome, and the Buzzard
Creek Maars for her master thesis remains one of
her proudest accomplishments.“ I just went back
to the geology department at the University of
Alaska in Fairbanks to see how it has changed and
was told that my geochronology and tectonic
assessment of those rocks still stands up, and that
all the research in that region in the past 30 years
has only re-confirmed my analyses. That was a
pretty good feeling.”
Read the full story on EarthExplorer.com.
Find Midnight Sun, Arctic Moon on
www.epicenterpress.com.

6 Earth Explorer Seeing the Shades of Grey in 3D inversion.


find me a target
W
h en g e o p hy si cis t
Hernan Ugalde was
contracted by a junior
mining company to
help define drilling
targets, he thought
himself fortunate the company had an
exploration vice president who believed
there was more to it than choosing purple
anomalies on remote sensing maps.
“It was an iron exploration project in
[Canada’s] Northwest Territories,” recalls the
Senior Consulting Geophysicist at Toronto-based
Paterson, Grant & Watson Limited. The mining
company had flown the magnetics, planning to
use map anomalies for direct detection of iron
deposits. Since iron is magnetic then the large
anomalies should be important targets, went
the reasoning. Ugalde and the VP Exploration
examined the magnetic data, but to improve
confidence, recommended ground field work
follow-up. It was fortunate they did. “The field
work recognized that the Fe-formation was
hematite, which is non-magnetic,” says Ugalde.
“Instead of throwing out the data and claiming
that the survey didn’t work, we used a think-out-
of-the-box approach and modeled 2D sections.”
He says working with a structural geologist
helped him to separate what was geologically
reasonable from what wasn’t. “We ended up
with very detailed models that provided the
company with targets, on which they will be
Read online at www.earthexplorer.com
Quick,
In a rush to drill based on
chasing anomalies, explorers may
overlook the structural geology
and miss the best drillspots.
By Graham Chandler
following up this year.”
The episode points up a valuable lesson for
mining companies intent on launching a drilling
program in short order after looking at remote
sensing data alone; which often happens when
eager investors want to see some action.
Ugalde suggests starting from the
regional, then going into more detail. He
stresses the importance of field work, mapping
and measurement of rock properties by the
geologist and geophysicist, who should
work in tandem. He says in the NWT example
“without that, we wouldn’t have been able to
recognize the different geological units that
were the base of the model, instead of the
usual blocks with no geological interpretation.”
Key is to take time for the geology. “The main
challenge is to get the message beyond the
‘can you find me a target?’ stage,” says Ugalde.
“It is quite common to see a mining company
operating with only one geologist, who is either
too busy dealing with all the admin and raising
funds, or doesn’t have the background to know delineation on areas where access is difficult
what to expect from geophysics.” and/or have not been mapped completely),
Some numbers help drive home his point. they realize that there is great value in doing
“Airborne geophysics with 50 metre line this kind of remote sensing mapping.”
spacing typically provides a resolution of just The big picture is often overseen. “When
10 metres per pixel making definition of precise companies jump stages on the large-to-
drilling targets difficult,” he says. “However, small-scale approach, they sometimes lose
once you can make the company understand track of what factors they did use to filter in/
the value behind the data beyond the drilling out some areas and often end up making
frenzy (i.e. extensive structural and lithogical an inefficient use of resources,” says Ugalde.
Quick, Find Me a Target. Earth Explorer 7
 Hernan Ugalde, Senior Consulting Geophysicist with PGW Ugalde stresses the importance of field work, mapping
and measurement of rock properties by the geologist and geophysicist, who should work in tandem.
“There is a big rush to produce an NI 43-
101 [national instrument for the Standards
of Disclosure for Mineral Projects within
Canada] with proven/inferred reserves.” It
requires sampling—drilling—at 50 m, and
in the rush to comply, Ugalde says it’s not
uncommon that structure is overseen and
therefore boreholes are placed where there
shouldn’t be any, or at an inefficient attitude/
geometry. “To give you an idea, I have seen
projects with <100 km of drilling where the
general structure was totally overseen, but
once you plotted the grades it was quite
evident that there was a structural control
(folding).” Taking some extra time to analyze
the structure would have definitely improved
the efficiency of that large drilling program.
In the specific case of geophysics, results can
be misleading unless the whole story behind
them is addressed. For example, “if borehole
planning is based on the wrong information
(e.g. K-anomalies associated to lithology
instead of alteration; not addressing magnetic
inclination and/or remanence; overseeing that
in an alteration zone you are interested in the
magnetic low around the large purple “blob”),
then you’re missing the whole story and this
can lead to the waste of those boreholes,” says
Ugalde. “It’s easy to just say geophysics did not
work, rather than understanding the overall fit.”
Chris Vose, CEO of Brisbane -based
Murrumbo Limited, has seen it directly from the
8 Earth Explorer Quick, Find Me a Target.
explorer side. “In my experience of small cap
explorers, there is way too much drilling before
there is any understanding of geoscience,”
he says. “Shareholders buy on rumor and sell
on fact and there is a perception that ‘drilling
equals rumor’ and the day traders and punters
pump the stock when drilling is underway and
results are pending.” He considers the rush to
drill is driven by a financial imperative: explorers
often lack the ability to communicate their
exploration strategy without delivering some
headline results for shareholders and investors.
Vose says that as a CEO and engineer he
relies upon geoscientific information and
advice and often finds geologists differ on
their interpretations. “I think that what good
geologists do well is to gather evidence
before advancing a theory or a model,” he
says. “In particular geophysics, geochemistry,
structural geology and geochronology are
critical to finding mineralization.”
Though not a junior investment situation,
Ugalde uses another example of the value of
ground control when interpreting geophysical
data: the Bathurst Mining Camp. A producing
mine from the 1950s, it was pretty much closed
and the Geological Survey of Canada (GSC)
funded a new survey; new geophysics. He
describes the entire area as 60 x 60 km with very
few outcrops. “So we had lots of geophysics
but little matching ground control,” he recalls.
“We did some modeling of gravity and
magnetic data, in 2D sections. The key here
was having me working together with Cees
van Staal, GSC’s structural geologist who knew
the way the faults were dipping, and how
many folded sequences did we need to put
on.” Combining van Staal’s knowledge of the
area with the resolving power of geophysics,
they ended up not only with a great 3D model
based on geophysics, but one that made
geological sense too.
“The geological input from Cees was
invaluable,” says Ugalde. “Modeling is a non-
unique problem, so you can put an infinite
number of geometries and still fit the data.
Having someone who knew what was feasible
and what wasn’t was very important.”
Software plays a big role but needs to
be applied properly, cautions Ugalde. “We
have software that makes life way easier and
that almost anyone can operate,” he says.
“However, knowing how to use the software
is not a replacement for knowing what you
are doing from the geoscience perspective.”
While a powerful aid, he sees a trend where
available software is not being used to its full
potential, mostly because of a lack of control
on what is actually being done or what is the
overall goal. “More access to sophisticated
tools needs to be balanced with proper
training and field experience.”
To help provide this balance it’s equally
important from the software development
perspective to ground advanced geocomputing
with the right geoscience. Software developer
and former exploration geophysicist, Ian
MacLeod, Chief Technologist at Geosoft,
explains the approach. “We rely strongly on the
expertise of our senior scientists, working with
industry collaborators, to build and develop
new technologies. Impactful technology
(based on our experience and understanding
of what is proven and effective for exploration)
is more important than pushing out the latest
feature set.”
“Good technology accelerates labor
intensive routines,” says MacLeod, “and it aids
in the integration and visualization of the
many dimensions of exploration—geology,
geochemistry, geophysics, remote-sensing,
field mapping, drilling—to help an explorer
iterate and best understand their target
environment. But proper understanding of
all that data, and correct application of the
tools, requires sound geological thinking and
practical experience.”
What can be done to remedy the lack of
interest in ground structural mapping as a
geophysics follow-up? Lots of training and
going back to basics, figures Ugalde. “We
need geologists to understand more about
geophysics so that in the future they know
what to ask for and what are the limitations of
each methodology based on geology, survey
specifications etc,” he says. And conversely,
“If borehole planning
is based on the wrong
information then you’re
missing the whole story
and this can lead to
the waste of those
boreholes... It’s easy
to just say geophysics
did not work, rather
than understanding the
overall fit.”
– Hernan Ugalde
Read online at www.earthexplorer.com
“we need to train geophysicists to understand
more about geology and see how geological
processes affect rock properties and therefore
the observed signature.” There’s a need for
geologists to go back to basics too. “How
many companies are there that actually do
structural mapping as part of their standard
exploration?” questions Ugalde. “How many
companies take the time to build a geological
model, rather than just grid the reserves?”
It’s not just software training he reckons,
but knowing what to do with the data. “For
that, we need to train people at all levels:
university level (before graduation), and the
current professionals doing the operations.”
Training at the university level is not a simple
one he says. Ugalde has completed a PhD so
has some firsthand observations. “Universities
now have a mandate for self-sufficiency which
has led them to teach programs that are more
attractive for undergrad students, who are the
ones who bring more money (tuition) into the
departments,” he says. The result is that more
and more geology departments are walking
away from hard-rock geology and switching to
environmental-based programs because that
is what sells to students. “However, nobody
bothers explaining to students what kind
of jobs they can get with that background,”
he says. “For example, talk to a second year
undergraduate about a career in mining, he/
she will probably refuse because of the bad
reputation of non-environmentally-friendly
mining.”
Indeed, judging from some recent group
discussion on LinkedIn, many geologists are
seeing this: a declining trend in hard-rock
geology in universities. The trendy shifts today
are increasingly on environmental studies,
carbon debates, sustainable energy—which
need to be explored too—but it is seen as
significantly affecting the exploration industry.
Structural mapping seems to be on the
decline; some consultants are encountering
exploration companies which even consider it
a waste of time and money. But basic structural
mapping by experienced people using the
newest technologies should still be seen as a
highly cost-effective exploration method.
University co-op programs can work well
says Ugalde. Under these, students combine
regular university terms with time working in
the industry; it exposes them to real problems
using real tools. But also “we definitely need
to motivate more cross-training (geophysics
for geologists; geology for geophysicists) in
the industry,” he adds, “so that we develop a
common language and everyone is clear on
what to get from the data, and what kind of
data to use on each situation.”
It may take a while to evolve, but ultimately
exploration companies and their investors will
realize the value of good structural mapping
as an adjunct to their purple blobs. o
Field Examples:
When good
ground control
is indispensable
(Next Page)
Earth Explorer 9
 Field Examples: When good ground control is indispensable

Bathurst Mining Camp

As part of a broader federal initiative to breathe new life into
abandoned and depleted mines in Canada, the Geological Survey
of Canada (GSC) undertook a large geoscientific program including
airborne gravity and magnetic surveys of the region around the
Bathurst Mining Camp in New Brunswick. Producing from the
1950s, it’s one of Canada’s oldest VMS deposits.

Because the area has very limited outcrop, geophysics

and remote sensing played a key role in the study.
However the airborne data alone clearly
wouldn’t tell the whole story with
accuracy. First, modeling of the gravity
and magnetic data in 2D sections
was done. Magnetics provided the
near surface geometrical control,
and gravity the depth.

Geophysicist Hernan Ugalde—

researching with McMaster
University—worked closely with Cees
van Staal, GSC’s structural geologist, to link
the geophysical information with ground data.
Van Staal’s intimate knowledge of the structure proved
critical: he knew the way the faults were dipping and how
many folded sequences were needed to put on. “So we combined Bathurst Mining Camp. Location map, regional geology and modeled lines.
his knowledge of the area with the resolving power of geophysics,”
says Ugalde, “and ended up with a great 3D model based on
geophysics, that also made geological sense.”

Example of GM-SYS modeled sections from the magnetic (top panel) 3D data integration of the 2D modeled lines)
and gravity data (middle panel).

10 Earth Explorer
 NWT Iron Ore Exploration
Regional location map.
Legend for all models:
Final product of the modeling exercise: depth to the
top of the Iron Formation, obtained from the modeling
and field mapping. It also shows the location of the
modeled lines.
Read online at www.earthexplorer.com
This was a Fe-exploration project in Canada’s Northwest. The target was an iron
formation within the Rapitan Group, interbedded with thin mixtite beds and extensive
large exotic clasts.
The company flew magnetics on the assumption that because Fe is magnetic, large
anomalies should be important targets and direct detection should work. However
ground follow-up fieldwork recognized the Fe formation was principally hematite,
which is non-magnetic. Instead of throwing away the data, 2D sections were modeled
using the magnetic data and a geology map with the location of the known IF.
Susceptibility measurements allowed determination of the range of values to use on
each unit. Basic stratigraphic principles plus required susceptibilities allowed placing of
the required units on the surface. Key again was working with a structural geologist to
help separate what was geologically reasonable from what wasn’t.
Amplitude of the analytic signal from the magnetic
data, used to map the initially interesting horizons.
Example of GM-SYS 2D modeled sections from the magnetic data. Blue: non magnetic
carbonates; pink: high magnetic conglomerate; white: non-magnetic iron formation;
yellow: moderately magnetic conglomerate unit.
“If the company had drilled directly on the airborne results, they most likely would have
intersected areas where the IF was already eroded and the anomaly obeyed only to
magnetic conglomerates,” says geophysicist Hernan Ugalde, who worked jointly with the
company’s VP Exploration. “They might have got lucky with a few holes on areas where
the IF was underneath, but without a thorough modeling analysis behind it they would
not have known what was where.” It emphasizes the importance of fieldwork, mapping
and measurement of rock properties—to recognize the different geological units that
were the base of the model. In the end, drilling recommendations were defined.
Earth Explorer 11
 cover Story

Risky business:
Balancing the risk and rewards
in greenfields exploration

Knowing when to drill and when to walk away is essential

in greenfields exploration. Explorers weigh in on market
realities impeding the search for greenfields, and what it
will take to meet the demand for quality finds.

By Dan Zlotnikov

M
any are pointing to a
serious misalignment
in mineral exploration
between the demand
for quality greenfield
finds and the industry
focus on brownfields, and are wondering
what it will take to get the right balance to
satisfy both current market realities and future
requirements.
At the surface level, it’s quite simple. On
the one hand there is rising need for high
quality deposits to meet global demands,
and this requires the industry to detect and
develop new greenfields deposits. Yet on the
exploration side, most of the spending and
efforts focus on brownfields, exploring next
to known deposits or re-evaluating previously
uneconomical projects.
This has industry experts expressing
concerns about the long-term future of
mining: Brownfields discoveries tend to be
smaller in size, lower in quality, and their total
number is ultimately limited. If greenfields
exploration activity continues to flag over the
long term, the industry as a whole may find
itself with a bad case of “all dressed up and
nowhere to go.”
The concern reaches all the way to the top:
at a conference in Sydney earlier this month,
Rio Tinto CEO Tom Albanese acknowledged
that “it is getting harder and harder to find
supply, harder and harder to find resources.”
He continued by pointing out that projects
approval timelines were getting longer, and
the approvals themselves have become
less certain. All this led Albanese to make a
prediction:
“The next five years is going to be a supply
story; the last five years has been a demand
story.”
Yet despite the industry’s growing
awareness of the issue and its seriousness, it’s
equally clear that there are no easy answers
or quick solutions for reinvigorating the
greenfields side of exploration.
Neil Briggs, whose more than 40 years of
mining experience have been split roughly

12 Earth Explorer Risky Business.

 When structuring a new deal,
we try to include a component
of work on a known deposit, or
a known good showing, with a
greenfields project in the same
vicinity. You can get money for
one and be dangling the carrot
of the other.
-Neil Briggs

LEFT PAGE: With its rich geological history, and diversity of mineral deposits, Greenland is one of the countries offering
greenfield exploration opportunities. ABOVE: New Opportunities specialist Neil Briggs, shown in Albania, helps junior
explorers raise funds.

evenly between major firms, a Crown
corporation, and junior companies, now works
as a New Opportunities Specialist, helping
junior explorers raise funds. Briggs says there
are a couple of factors at work. First is the
recent economic upheaval, which has caused
many investors to shift toward lower-risk
opportunities.
According to Briggs, “in this lousy market
environment, you have to generate some
excitement to raise money, but brokers and
investors aren’t excited about grassroots
projects. They want to hear about a project
somewhere with all these wonderful numbers.
That’s what gets them excited, gets the share
price up, and allows juniors to raise money.”
This isn’t a new challenge, but Briggs offers
a key historical insight: It used to be the majors,
not the juniors, who did the greenfields
exploration work. This is where the second
factor comes into play: A company’s size.
For a large company, Briggs explains, it’s
not enough for a deposit to be economically
viable to mine; it also has to be large enough
to have a noticeable impact on the company’s
overall revenues. As the majors kept getting
bigger, so did the size threshold of a deposit
they’d be willing to develop.
Today, the majors might “do a very broad
regional program, only looking for very big
targets. They’ll ignore good-looking targets
that don’t have the size potential. Some of
the companies are so big that to affect their
bottom line, you need something that’s truly
huge,” he says.
The recent comments to investors
made by Rio Tinto’s Albanese support Briggs’
position, but Albanese also highlighted a
different issue the majors face: Investors
are looking askance at massive capital
expenditures, and are pressuring the industry’s
leaders to instead pay out more in dividends
and share buybacks.
“But what that means, and we are
hearing it, we know our peers are hearing
it, there is going to be less supply coming
in,” Albanese said. This further increases the
majors’ motivation to focus on only the largest,
highest-return projects—the same ones that
are becoming harder and harder to find.
Targets that don’t have the requisite
size potential frequently will not see any
exploration activity. These may eventually be
sold off to juniors and end up as profitable,
if smaller, projects. But the majors’ focus on
larger, much less common, finds also means
further uncertainty for the sector as a whole:
Imagine what would happen to copper prices
if new deposits of the metal were only found
once a decade, but each was twice the size of
Oyu Tolgoi.
With the majors’ narrowed focus, it’s the
junior companies that must take up the slack
of greenfields work. But can they? Limited in
capital, most often without positive cash flow,
greenfields exploration firms have always
been seen by investors as a risky proposition.
Even Briggs, who’s been working with juniors
for 16 years, is leery of investing in straight-up
greenfields projects.
“When structuring a new deal, we try to
include a component of work on a known
deposit, or a known good showing, with a
greenfields project in the same vicinity. You
can get money for one and be dangling the
carrot of the other,” he says. Hardly a surprise
then that so much exploration activity of late
has been focused on the less uncertain—but
smaller—rewards offered by brownfields sites.
So what is there to do for greenfields
companies that don’t have such an investor-
pleasing pairing on hand? Is their only
option to forge ahead and hope they make
a discovery before they run out of money?
Fortunately, the answer is “not quite.”
Safety in Numbers
It’s been so long since Brian Cellura has had
to put a drill hole in that he takes a moment to
remember how much the process might cost.
This is a rather surprising admission, given that
Cellura is a senior geologist at Miranda Gold,
a junior exploration company. But the notion
of drilling not being part of the company’s
exploration activities is central to the Project
Generator approach Miranda is taking.

Read online at www.earthexplorer.com Risky Business. Earth Explorer 13

 Miranda Gold’s funding partner Ramelius
Resources started drilling at the Big Blue project
in April. Big Blue is a sediment-hosted gold
greenfields project located in Nevada’s proven
gold belt. Miranda’s interest was drawn to the area
through a generative program evaluating a number
of district-scale stream-sediment anomalies whose
character has an affinity with large sediment-
hosted gold districts in Nevada.

Suppose potential investors—the same

ones shying away from true greenfields
projects—were presented with a junior
company that was working on not one but
ten greenfields projects? Would they consider
such an opportunity less risky, and be willing
to invest? If Miranda’s example is anything to
go by, the answer seems to be “yes.” Founded
in 2000, the company now has 16 projects
in its portfolio and cash reserves of CAD6.5
million, something most juniors can only
dream about.
So how did Miranda get to be such a
diversified, well-funded junior? In fact, how
did Miranda manage to spread out to so many
projects, remain an exploration company, and
not run out of money years ago? The answer,

Drilling is what kills a lot of junior companies.

It’s the cost that does them in. An average drill
hole will cost you upwards of $50,000. So to
put a decent drill hole program in, 10 drill holes,
you’re talking half a million dollars, and that’s a
big chunk of a junior’s budget.
-Brian Cellura

Brian Cellura is a senior geologist at

Miranda Gold, a junior exploration company
specializing in project generation.

14 Earth Explorer
says Cellura, lies in that crucial point in a
junior’s evolution: The decision to start drilling.
“Drilling is what kills a lot of junior
companies. It’s the cost that does them in.
An average drill hole will cost you upwards of
$50,000. So to put a decent drill hole program
in, 10 drill holes, you’re talking half a million
dollars, and that’s a big chunk of a junior’s
budget.” By contrast, Miranda’s cash outlay on
a single property tends to be around $20,000.
Cellura explains that Miranda does all the
work leading up to the decision to drill—and
then looks for a joint venture partner who
would take on the actual drilling. Partners
can earn a 60% ownership in the project by
spending around $10 million on exploration
and associated fees, Cellura says. If the
project were to go on to become a mine,
Miranda would remain a non-operating
partner, focusing its efforts on exploring new
properties and finding new drill targets.
Cellura adds that it’s also important to
know when to let a project go, something
Miranda does regularly—and why its portfolio
today is just 16 projects, not 60.
“At some point we’ll say, it’s a bit of a
money sink. If we can’t get another company
interested in, we’ll let it go and move on to
something else,” he says.
According to Cellura, it’s this willingness
Read online at www.earthexplorer.com
to cut loose projects before significant
money is expended that negates much of
the risk of greenfields exploration. Being
able to do so at a rapid pace is also why
both Cellura and Briggs feel that juniors
have the advantage when it comes to doing
greenfields work. Larger companies, despite
their greater resources, simply can’t react as
quickly to new opportunities.
The majors “go through exercises to
‘prioritize’ the best targets, whereas most
juniors just look for an excuse to drill,” says
Briggs. In Miranda’s case, being able to skip
the drilling stage allows them to achieve truly
impressive throughputs.
“The average evaluation period for a
project, depending on how good it is, will
be two-three months, maybe four at the
most. So over a four-month period, because
we’re rotating projects around, we can get
through 20-25 different projects. That allows
us to cherry-pick what we think are the best
projects. It’s very hard for a major to run at this
speed with this sort of efficiency,” Cellura says.
Waiting For The Big Wave
Briggs does offer some good news for
the pure greenfields explorers: Having been
through more boom and bust cycles than he
cares to count, he’s seen rising commodity
prices boost greenfields exploration, as
investors once more flock to the mining
sector. “A rising tide floats all boats,” he says.
Briggs also points out that the definition
of what is and what is not pure greenfields
isn’t cut and dry: In some of the less
developed nations there may be areas with
a number of historical mines, but little to
no regional exploration work done. A junior
might do well to look for targets, “not directly
adjacent to the known mines, but maybe
within tens of kilometres.”
At the same time, Miranda Gold serves
to remind explorers that one can get pretty
far before needing major investment. Nor
is the decision to try the Project Generator
route an irreversible one: Cellura says
Miranda Gold itself isn’t dismissing the
possibility of eventually transforming from
explorer to producer.
“We haven’t yet found the discovery
that would do that for us,” he says. Until that
day comes, he continues, Miranda will gladly
continue defining new areas and feeding
its partners new drill targets. In today’s
greenfields-shy world, this is likely to remain a
much-needed service. o
Earth Explorer 15
 Sourcing
regional data
Government survey data
serving greenfields explorers
above: Gary Price is Bowgan’s Chairman and Manager of Geology.
below: Analysis of government survey data generated the bulk of targets for Bowgan Minerals’
joint-venture properties with Mega Hindmarsh in Australia’s Northern Territory.

For juniors constrained by limited
resources, usable and inexpensive
government survey data is often
key to stimulating and advancing
greenfields projects.
By Dan Zlotnikov
A
junior exploration company’s path to success is
fraught with risks and upsets; and opportunities are
constrained by their limited resources. With each
diamond drill hole costing $50,000 or more, a junior
can only have so many miscalculations before it will
find itself with no money, no promising discovery, and
no way to continue the work.
Given the risks a junior must already accept, anything that serves
to relieve the risk and reduce unnecessary expenditure of limited funds
is welcome. What if, to pick a not very random example, some of the
large-scale, regional sampling and surveying was already done? Better
yet, what if the resulting data were made available for free?
This is exactly what happened in the case of Bowgan Minerals,
an Australian exploration company working on two joint-venture
properties with Mega Hindmarsh. Gary Price, Bowgan’s chairman and
Manager of Geology, explains that the data gathered by the Geoscience
Australia has proven very helpful to the partners.
“The bulk of our targets have been generated after in-house
analysis of government data,” he says. Some of the targets being worked
on were identified during the company’s own exploration activities, but
the majority were recommended by “a very good geophysicist at Mega
Hindmarsh,” gleaned from the government data.
Price adds that the database includes not only data gathered
directly through government-funded programs, but also results of
previous exploration work done in the area by private firms.
“Once tenements are surrendered or work is discontinued, within a
period of time that data is collated into a usable format and also made
available to the public,” he says.

16 Earth Explorer Sourcing Regional Data

Trelawney’s recent discovery of the almost seven-million-
ounce Côté Lake gold deposit resulted from an exploration
program largely based on historical data available from
government and companies who had explored the property
over the past 60 years.

Bowgan, in turn, has to report its exploration results

annually to the government, closing the information-
Expansion and definition drilling is ongoing on the Côté Lake Gold Deposit with 9 drill rigs.
sharing cycle. Ontario Geological Survey (OGS) data and expertise has helped to find and define the type of
Overall, Price says the company has benefited deposit for efficient exploration.
significantly from being able to access the
government’s repository of information.
“We’re very happy with that amount of data, being able to access Regional Impact
that information. We’re talking a variety of formats, a variety of different
methodologies, and a large amount of usable data. To access that at Price highlights a second benefit government survey work can bring:
minimal expense is a tremendous benefit.” Regional surveys, while comparatively low-resolution, can cover vast
Halfway across the world in Ontario, VP of Exploration at Trelawney areas. The individual exploration firms can then use that data to identify
Mining David Beilhartz tells a similar story. Trelawney recently promising areas where they can conduct their own, more detailed, work.
discovered the almost seven-million-ounce Côté Lake gold deposit, and Since the government-run programs don’t set the goal of finding
is now engaged in advanced exploration at the site. Beilhartz says that a specific deposit, they can also look at less obvious areas, sometimes
while previous exploration had taken place on the property, no gold with unexpected results. Price recently attended a conference where a
production has ever taken place. geologist from the Northern Territory Geological Survey (NTGS) presented
The exploration program Trelawney put together was based on a the results of a nationwide stream sediment sampling program. “Through
compilation of historical data available from government websites and that this study they’ve identified a number of new provinces for particular
held by companies who’ve explored the property over the past 60 years. elements that haven’t been recognized before,” he says.
“The majority of previous landowners’ data was acquired through “They were saying, ‘this province here, near Alice Springs, and
the government, though some we purchased directly from the this province up here, we didn’t realize that this element is occurring
landowners. Most of the government data was from the assessment in abundance within stream sediments in that area. We would
reports filed with the OGS,” says Beilhartz. recommend, if you’re interested, to have a look in this area.’”
Beilhartz explains that companies engaged in exploration in the The payoff for the government can be years—or even decades—
province must file the results with the government in order to get down the road, in the form of more exploration activity and eventually
assessment credits needed to keep their claim in good standing. These more producing mines paying taxes and stimulating economic activity.
reports are processed by the OGS—the Ontario Geological Survey— Admittedly, the data can go stale, over the years and decades:
and made available to the public at no cost through the OGS website. Beilhartz holds up expanded geophysical survey coverage and better

Read online at www.earthexplorer.com Sourcing Regional Data. Earth Explorer 17

 understanding of orebodies as a reason for government teams to revisit
previously-surveyed areas and update the data.
“In Ontario’s case, a lot of old areas that have only seen mapping in
the 40s and 50s. There’s a lot of updating that can be done in the North-
Eastern Ontario region,” he says.
“For gold and other minerals as well, deposit models have changed a
lot in the last 40 years. They’re finding deposits in areas that 20, 30 years ago
people were saying ‘there’s nothing in that area. Why should we look there?’”
In a way, Trelawney is a living example of both benefiting from
improved understanding of orebodies and of spurring that understanding
on. Rather than the high-grade, low-tonnage Archaean gold deposits
common the Greenstone Belt of Northern Ontario, Côté Lake is a low-
grade, high-tonnage porphyry-style deposit, a deposit type previously
not thought to exist in the area. Beilhartz says that Trelawney sought
advice from the OGS staff geologists when the company was trying to
select the correct deposit model for Côté Lake.
“After the discovery, their more general and academic experience
was very useful in helping define what type of deposit we were looking
at,” he explains.
Brian Atkinson, a Regional Resident Geologist with the OGS and one
of the people Trelawney asked for advice, says that now that there is
unequivocal evidence of this type of deposit in the region, explorers will
know to include the appropriate model in their analysis and structure
their exploration programs accordingly. How will they know? By asking
their Resident Geologist, of course.
This access to the government’s experts is a service Beilhartz
highlights as very valuable.
The ability to not only use static survey data or look at assessment
filings but to also contact the scientists for advice is a benefit Beilhartz
greatly appreciates.
18 Earth Explorer Sourcing Regional Data.
“The government geologists are always available to talk to, no
matter whether you’re exploring in an area or not, they’re always very
helpful with ideas and theories of where you should explore in Ontario.
Even if you’re a junior company coming to Ontario and you say you want
to look for this particular type of deposit, they’ll help you in targeting
areas of the province where you can focus your efforts,” he says.
Nor is the geologists’ advice limited to broad, region-sized decisions.
Atkinson points to drill hole spacing as one—potentially very expensive—
decision that would change based on the deposit model. The challenge
of a drill program is to get the maximum amount of information about
your deposit while drilling the smallest number of oh-so-expensive drill
holes possible. In the case of Côté Lake, Atkinson says, the drill holes were
spaced about 100m apart. But try that with an Archaean-type deposit?
“You could hide a mine between these two drill holes. It’s very high-
grade, but very small.”
Little wonder then that Beilhartz has so much positive to say about
the OGS scientists’ help.
If you’re a junior in search of a promising area to explore, or even if
you’ve already made a discovery but could use a different perspective
on your deposit, the local geological survey office may be a good
place to turn to. Atkinson points out that virtually every country has a
geological survey office, many of which make survey data available.
Atkinson notes that while most charge for the data and consultations,
Ontario offers both for free. This strategy that seems to be paying off for
the province in the form of exploration activity: According to Atkinson,
some 330 companies had spent more than $1 billion on exploration in
the province in 2011, a record high.
“As long as prices of metals and commodities remain high, we’ll
keep seeing lots of exploration and new discoveries,” he says. Which
ultimately is the whole point. o
 Redefining the search
space for minerals
Greenfields-related research conducted by the
Centre for Exploration Targeting aids industry
efforts to look deeper.
By Dan Zlotnikov
Higher quality deposits, with reduced physical, social and environmental footprints, are required to reinvigorate mineral supply.
T
he Earth Explorer team recently
viewed a presentation by
Campbell McCuaig, Professor
and Director at Australia’s Centre
for Exploration Targeting (CET),
on the challenges facing today’s
exploration companies—and, by extension, the
mining industry as a whole. McCuaig and other
colleagues have told the same troubling story
many times before. The presentation begins
with the certainty that: The world’s mining
industry is facing a worsening resource gap,
and unless industry leaders take steps now, the
industry’s future is under threat.
The reasons for concern are plain: The
amount being extracted has outstripped new
discoveries at the same time as demand for
commodities is predicted to keep growing.
Addressing the shortfall is going to require
significant changes in the way the industry
operates—and according to McCuaig, these
changes have been slow in coming.
Depletion of the
traditional search space
The need for new finds is undeniable:
McCuaig pointed out that copper demand
Read online at www.earthexplorer.com
for 2006-2030 is projected to exceed the sum
total of all copper produced in human history
up to that point. The situation is generally
similar in other commodities, he said.
An underlying cause, McCuaig explained,
is the ongoing depletion of the industry’s
traditional search space.
“Mankind, over thousands of years, has
become pretty good at finding an ore body if
it sticks out of the ground,” he said. The largest
deposits nearest to the surface are easiest
to discover, meaning the trend has been
one of huge returns for the first explorers in
an area and a steady decline in the value of
subsequent, brownfields, discoveries.
McCuaig added that as an area gets
mined out, new discoveries aren’t just smaller
and lower in quality—they’re also more costly
to find in the first place: In the 1960s, $1 of
exploration investment returned an average
of $105 in discovered gold. By the 2000s, that
$1 only averaged an $11 return—despite gold
prices rising from $400 to $900/oz. The same
loss of exploration effectiveness is seen across
all metals.
Despite the rising cost and diminishing
return, the trend has been in favour of
brownfields projects, at the expense of
Redefining the Search Space for Minerals.
greenfields funding. At a success rate of
below 1%, greenfields projects are much
riskier investments than brownfields, causing
investors to shy away. McCuaig pointed to this
brownfields bias at the expense of greenfields
exploration as one of the major reasons for the
industry’s current difficulties. He also pointed
out that rising commodity prices alone are not
a panacea for bridging the resource gap by
bringing on lower quality marginal resources—
such projects are continually challenged.
Looking deeper under cover
So what can the industry do to address
the shortfall? CET’s proposed solution, and
research focus, is redefining the search space:
looking deeper under cover.
The problem with this is cost: Not only
will a discovery require greater outlay, you will
have to pay more to even make the attempt.
This is a major challenge, said McCuaig, but not
an insurmountable one: Just look at how the
Gulf of Mexico changed in the last 50 years.
“If you talk to oil people, they didn’t even
believe that there were reasonable deposits
deep in the basin,” he said. “So there was a
conceptual leap, from ‘why even bother to
Earth Explorer 19
 H IG H
C am p scale d ecisio n

D E T E C T IO N A lte ra tio n h a lo s

E F F E C TIV E NE SS
H ig h d e fin itio n

R E L AT IVE
g e o p h ysic s
D rillin g
G e o c h em istry
P R E D IC T IO N

LOW
B R O A D R E G IO N A L PROSPECT SCALE
SCALE
M c C u a ig a n d H ro n s ky 2 00 0

H ronsky, 2011

left: A physical process based mineral system model. RIGHT: A multi scale approach with different scale requiring different tools.

National Distal Footprints Map

OD Density Inversion Anomaly

Areas of Textureless
Seismic Response

40 km
Moho

Magnetotelluric Section through Olympic Dam

less conductive more conductive
Modified after Hayward, 2004; Magnetotelluric section provided R. Gill, Uni. Adel;

look there’ to ‘how are we going to visualize
it?’” Today, the Gulf holds some of the largest
offshore oil fields in existence.
McCuaig said the mining industry is poised
at the same crossroads as the oil industry was
30 years ago. Today’s high commodity prices
provide incentive for investment in innovation.
It’s this innovation that holds the key to
bringing down the cost of making new, deeper,
discoveries and securing future resource supplies.
Exploration under cover will be in areas
blind to many of the industries standard
detection technologies. While improved sensing
technologies will allow us to look deeper, the
added cost means these technologies must
be deployed more selectively. The challenge,
then, is identifying worthy targets for in-depth
exploration, and doing so at a regional scale.
McCuaig’s presentation described three
approaches: An integrated 3D model using
geophysics data (seismic, gravity, aeromagnetic),
stratigraphic and structural mapping was
analysed by a human expert-driven mineral
systems approach, a conceptual computer-
driven approach and an empirical computer-
calculated correlation between predictor maps
and known gold showings.
While none of the approaches eliminate
uncertainty, the combination of all three allows
for better, more accurate targeting, says McCuaig.
Of course, there is plenty of room to further refine
these techniques—or develop entirely new ones.
One organization working toward that
goal is the CET itself: Established in 2005 as
a partnership between the Government of
Western Australia, the University of Western
Australia, Curtin University, and members
of the mineral exploration industry, the CET
conducts international research and applied
projects aimed at developing better exploration
targeting models and new technology
packages for predicting deposits. The Centre
has highlighted greenfields-related research as a
focus, aiding current and future industry efforts
to look deeper. o

20 Earth Explorer Redefining the Search Space for Minerals.

 Offshore oil prowess:
Eni’s expertise in deep offshore
oil exploration

As the planet’s easy-to-find petroleum resources mature, deep

offshore exploration and production lead the trend to the more
difficult and challenging regions. Eni is one of a handful of leaders.
By Graham Chandler

Eni Oil Bouri DP4 in Bouri Field is the biggest platform in the Mediterranean Sea.

P
eak Oil theories aside, it’s no
secret that the world’s easily-
found petroleum reserves have
mostly been discovered already.
And as the planet continues to
consume at the rate of nearly
1,000 barrels a second they are depleting.
Exploration companies are pushing further into
frontiers where environments are harsher, or
were hitherto limited by technologies of the day.
The International Energy Agency predicts
that oil will continue its dominance of the
world energy scene well through 2035. By
then, the organization projects, daily global
consumption will have increased 18 percent
to 99 million barrels per day. There will
probably be enough to go around, but it’s
ever-increasingly located in more expensive
and complex frontier locations. So that’s where
the exploration is trending.
New technology such as horizontal drilling
and multistage fracturing is already unlocking
vast new production levels from fields long
abandoned as uneconomic—North America’s
Bakken formation for example, which is
expected to soon be producing a million
barrels a day. These ‘tight’ and shale plays are
skyrocketing in countries around the world
and will help advance world production
numbers. But it’s the frontiers where the big
new elephant fields are being discovered.
Leading the new frontier exploration trend
is the deep and ultra-deep offshore: the east
coast of South America, the east and west coasts
of Africa, and the Gulf of Mexico for example.
Brazil is reported to have nearly 48 billion barrels
of oil in water deeper than 600 meters. One field
alone—the Lula—holds probably 6.5 billion
barrels. Africa’s offshore west coast is where
the world’s most active deepwater fields are
found—primarily Angola and Nigeria.
The Gulf of Mexico, with more than
3,400 offshore production facilities, has been
producing for decades. But further out, 300 or
so kilometers from shore, the water is deeper
and the geological formations are older.
Esteemed energy research firm IHS CERA has
suggested there’s nearly 13 billion barrels of

Read online at www.earthexplorer.com Offshore Oil Prowess. Earth Explorer 21

 A new approach to
exploration has to
be developed with a
higher integration, at
all stages, of different
disciplines such as
seismic reflection and
gravity modeling,
both inverse and
forward.
-Luca Mapelli

Luca Mapelli is Potential Data Team Leader at Eni.

recoverable deepwater oil out there yet. And
already Shell’s Perdido production platform
is on location producing from deposits 2,400
meters below the surface.
Knowledge of these deposits’ existence
has been around for some time. Geological
theory suggested the reservoirs were out there
in sedimentary units past the offshore deltaics
and into the turbidites. But the technology to
explore and produce them wasn’t.
Holding back seismic exploration was
largely the presence of massive salt layers
which can be over two kilometers thick, laid
down millions of years ago as ancient oceans
evaporated. These high velocity media, with
strong lateral velocity contrasts, induce such
intense bending in the seismic waves that lots
of the reflected energy can’t be recorded. This
creates problems especially in the imaging of
the salt flanks and in the formations below salt.
Leading the technological frontiers that
have been unlocking the ‘salt barriers’ and
making the discoveries possible is a handful
of world companies. One who has developed
the expertise is global player Eni.
Luca Mapelli, Potential Data Team Leader at
Eni, explains how progress was made in seismic
modeling that led to the breakthroughs. “First
you search for easy targets, then when you
need to increase the reserves you start looking
for difficult targets,” he says. As these targets
became the deep offshore, improved seismic
processing capabilities were coming to the fore
over the past decade, which opened up ways of
looking beneath salt layers. “Explorers were able
to better look beneath salt,” he says, “which still
poses imaging difficulties, but less than before.”
Those advances included better processing
through PSDM, RTM and better data gathering
using WAZ, MAZ, and coil shooting says
Mapelli. PSDM, or Prestack Depth Migration, is
a model-based seismic imaging methodology.
Compared to conventional time migration
image processing, which assumes that seismic
waves are propagated in straight rays, PSDM is
pricier and slower but the payoff is more precise
determination of reservoir structures. RTM, or
Reverse Time Migration, can boast simplicity
and superior imaging quality by using a full
solution 2-way wave equation—it makes no
approximations limiting the direction in which

Eni’s use of Geosoft GM-SYS software demonstrates the
integration of potential field data with independent constraints,
such as seismic and well data, to better constrain the
interpretation process. Shown here is a GM-SYS 3D model
constrained by well data and a seismic reflection profile.
With new density model support available in Geosoft GM-SYS 3D, voxels can
be used to define the 3D density variation within GM-SYS 3D model layers. This
provides more direct integration with 3D seismic data as the generated density
cubes may be used directly in the GM-SYS model. This Hybrid 3D model shows
three types of density distributions: Constant (top), Voxel (3D), and Density-
Depth distribution (bottom). A lateral density distribution is not shown.

22 Earth Explorer Offshore Oil Prowess.

seismic energy can travel. WAZ (wide-azimuth),
MAZ (multi-azimuth) and Coil shooting are
advanced acquisition techniques aimed at
addressing the illumination problems inherent
in traditional narrow-azimuth marine seismic.
Coil shooting, used in exploration for deep
offshore fields, consists of streamers towed
behind a ship on spiral routes rather than on the
traditional regular geometric grids. It provides
full azimuth coverage of the targets allowing
more detailed imaging than conventional
techniques, and the data acquisition rate
is faster compared to other multi azimuth
techniques such as MAZ or WAZ.
While these advanced techniques are
now indispensible in the deep offshore arena,
there’s much more to it. For consistent success,
integration of techniques and methodologies
has become paramount. “A new approach
to exploration has to be developed with a
higher integration, at all stages, of different
disciplines,” says Mapelli, “such as seismic
reflection and gravity modeling, both inverse
and forward. Only such synthesis improves
our ability to constrain non-unique results
predicted by theory, allowing for solutions
that are distinct and robust in practice.”
“I could never stress too much the
necessity of close integration between seismic
and gravity data interpretation,” he says. “It
should not be intended as a simple sharing
of results, but as a new working approach
where each discipline drives the other.” This is
possible because seismic velocity (the basic
property measured by seismic methods) and
gravity share a common factor: density.
He explains that, as seismic velocities
depend on elastic parameters and density,
gravity inverse modeling could help in the
definition of a density volume that could drive
the definition of the seismic velocity volume,
which is an essential part of the migration
Read online at www.earthexplorer.com
process in PSDM. The link between velocity
and density is based on empirical relations
that are more reliable if statistically controlled
by well logs, i.e. sonic and density logs.
“During the interpretation phase, both
gravity/magnetic data and seismic data could
be used together to derive a unique geological
model,” continues Mapelli. “The contribution
of gravity data is more important wherever
seismic data encounter imaging problems
such as the presence of thick salt, gas hydrates,
basalts etc. The higher the initial uncertainty
is, the greater the value of a gravity/magnetic
and seismic integrated approach will be.”
Mapelli uses Geosoft software for data
integration, as it allows processing of potential
data in a unique environment, and the ability
to load other data such as seismic and wells to
better constrain the interpretation process, he
says. “The drill plotting capabilities help with the
integration of gravity data and well data. When
available, well data can give a strong constraint
on the interpretation.” Modeling capabilities, 2D
as well as 3D, provide an easy way to check the
consistency of a seismic interpretation, he adds.
These integrated techniques played an
important role in the greatest discovery of
Eni’s exploration history: the massive gas field
in the Rovuma basin offshore Mozambique,
which the company reported was “beyond
expectation”. Exploration wells in the Mamba
South showed up to 22.5 tcf, Mamba North
7.5 tcf, and Mamba North East 10 tcf; for a
total of up to 40 tcf of gas in place. These are
in waters 1,800 metres deep with overall well
depths of 4,500 metres, “Exploration success
was boosted by the application of proprietary
technologies in the area of seismic mapping,”
states the company’s 2011 Annual Report.
Gravity data acquired together with seismic
data played a key role in the processing and
interpretation says Mapelli. “The gravity dataset
helped in the definition of the main depocenters,
especially the isostatic map which clearly shows
the thickest part of the sedimentary section,”
he explains. “Other elaborations helped in the
enhancement of the anomalies thus providing a
better view of the structures affecting the area.
A 2D modeling along selected profiles allowed
us to fine tune the geological model with a
sequential adjustment of the initial model until
the misfit error fell below a predefined threshold.”
It has been an exciting proof of Eni’s
expertise and technology. The company plans
eight more wells over the next two years to
monetize Mamba’s reservoir potential. For
other companies, there are still thousands
more square kilometres of offshore to explore.
“Even the big salt provinces of west Africa, Gulf
of Mexico and Brazil should be investigated in
even greater detail and depth,” says Mapelli.
D e ve l o p m e n t a n d e n h a n c e m e n t
continue, but so do new challenges. “While
great improvements have been achieved
in seismic imaging as well in potential data
methodologies, the way forward is to improve
the inversion methodologies for seismic data
as well as gravity/magnetic data,” says Mapelli.
“A real 3D joint inversion between gravity
and seismic is the Holy Grail. Passing from a
cooperative inversion to a joint inversion is the
real step forward to get a unique geological
model that satisfies the available data.”
The advances are paying off handsomely
for many companies; one winner has been
explorers’ reduced per barrel finding costs.
Although exploration costs dwarf typical
onshore per well figures, the sheer size of
the deep offshore discoveries reduce the per
barrel numbers. Brazil’s deep offshore Santos
Basin for example yielded 30 billion barrels
discovered with just 32 exploration wells. o
Integrated techniques played an
important role in ENI’s discovery of a
massive gas field in the Rovuma basin
offshore Mozambique.
Earth Explorer 23
 Explorer Profile

Christina McCarthy:
Mining the capital markets
Geologist and mining
specialist Christina McCarthy
turned a market crash into a
capital opportunity.

Christina McCarthy in the field, mapping and sampling at the Jervas project
in Northern Sweden.
I
t sounds ironic but when Christina McCarthy lost her field
geologist job in the 2008 market crash she quickly turned to
that very market for her next career.
Now a Mining Specialist with Toronto’s Euro Pacific Canada,
McCarthy was working with Blackstone Ventures at the time: in
Norway and Sweden on VMS and nickel-copper deposits.
“I was working on different properties and had a great mentor,”
she recalls. “But after about two years, the markets crashed,” and she
found herself laid off.
It had been her first full-time position following graduation and just
what she had been looking forward to as a budding field geologist.
Born and raised in Hamilton, Ontario, McCarthy remembers her
earliest interest in the profession. “In high school they didn’t teach any
type of geology courses so I wasn’t introduced to geology until I went
to university,” she says. She started as a psychology major at Brock
University, but when she got into Geology 101 she was hooked. “I
immediately fell in love with geology which led to my degree and I
became a geologist.”
The Scandinavia job after graduation was a great experience. She
learned hands-on how to do advanced exploration of VMS, nickel-
sulphide and IOCG deposits through core logging, detailed mapping,
sampling, geophysics, data analysis and presentation. She was loving
it. When the market foundered and she was laid off she went back
to Toronto thinking, “what am I going to do now? I couldn’t picture
doing anything other than geology.”
But her Type-A personality proved to be the solution. “I’m a
communicator,” says McCarthy, “and I realized that I could still do
what I loved—geology—in the capital markets.” But it was 2008
and no one on Bay Street was hiring. “So I went to an investor
relations company that worked mainly with resources and worked
for free for the first five months. I just wanted to learn the industry.”
Shortly afterwards she caught the attention of the Equicom Group
which recruited her for their resource team. “There were only two
of us on the resource team—myself and my partner Joanna Longo,
a veteran in the capital markets who became a great mentor to
me,” she recalls. “We worked many late nights together, building
the business, and eventually we thought: why not hang out our
own shingle?”
The two of them went off and started their own investor
relations company under the BayFront Capital umbrella called ‘Terre
Partners’.“We ran our business out of a coffee shop in downtown
Toronto,” says McCarthy. “With our combination of capital markets
experience and technical background, we had new clients and a
successful business within a few months.” In addition to IR, they
worked alongside the merchant bankers who raised the capital for
resource companies. “My role was to look at exploration companies,
going through a detailed check list of what made the company great,
and great enough to introduce to our clients. When you’re asking
investors for those million-dollar cheques, you have to find the best
projects out there in a competitive market.”

24 Earth Explorer
 That experience prepared her perfectly for her present position
with Euro Pacific Canada. It’s often hands-on again, at field sites, all
over the world. “I fly to Timmins, Mexico, Ethiopia, Bulgaria, wherever
the project is, and look at it. I look at the potential and the prospectivity
of the project, to determine if it’s something our clients would want to
get involved in.” It’s a detailed look: favourable geology, jurisdiction,
historical production, cross-sections, the drill core data, detailed maps,
engineer and technical reports—everything that’s available.
The position is one of a mediator says McCarthy. “We introduce
them to the investors who are going to give them the capital to
advance their projects and ultimately get it to the mining stage.” So
she sees the needs of both sides.
Today’s investors are sophisticated; they know what to ask.
McCarthy uses the example of a prospective gold deposit. “Investors
want to know the mineral grades, metallurgy, recovery and strip ratios.
Is the deposit comprised of oxide material or is it a sulfide deposit?”
she says. If it’s an oxide gold deposit they know it has the potential to
be a heap-leach operation, whereas if it’s a sulfide or nickel deposit,
smelting and refining may be involved—which may mean a higher
capex. Similarly, if there is a high strip ratio and the grades are not high
enough, the deposit may not be economic.
“Questions will include: is this a good grade deposit, do you have a
mining Major around you? A lot of investors want to know if there’s
potential to have a big enough deposit that you might be taken over
or be partnered with someone,” she says. Another investor concern
is location. In a mining jurisdiction such as the Timmins—Kirkland
Lake Gold Camp, which has exceptional infrastructure and favourable
geology with over 150 million ounces of historic gold production, will
be attractive. Government or political risk can’t be overlooked, either. “I fly to Timmins, Mexico,
And “they want to know about mining laws, permitting, geopolitical
and environmental risks,” says McCarthy.
Ethiopia, Bulgaria,
What else do investors need to know about exploration wherever the project is,
companies? “I would say there is a checklist,” she offers. First of all,
“drilling is the truth serum. That’s the only thing that’s really going and look at it. I look at
to tell investors what is there. But drill targets need to be backed up
with the right geoscience.” She cites a small explorer in Southern the potential and the
Mexico’s Guerrero Gold Belt along the trend of a major’s mine. “They
are doing all the right things first: mapping, soil samples, soil lines, grid
prospectivity of the
lines and trenching. They’re taking all the steps to try and correlate the
geophysics with soil samples and trenching; if they are coincident you
project, to determine if
have a drill target.” An experienced management and technical team it’s something our clients
are very important as “people buy management”.
McCarthy says many companies try and talk up potential when would want to get
they don’t have all the necessary work to back it up. “A company
that has done all that work, has the coincidental geophysics with
involved in.”
soil sampling and trenching, has two check marks to define that
drill target.” Investors need the comfort of knowing companies have – Christina McCarthy
a good target and are approaching it systematically so they know
shareholders’ money won’t be wasted. “Because ultimately the goal is
to prove up a reserve and build a multi-million ounce mine.” o

Read online at www.earthexplorer.com Earth Explorer 25

 Using DGPS an ASI survey vessel placed the recovery team over
each suspected target location. An EM-Probe was then hand-
pushed into the sediment to further pinpoint each object.

Amityville
weapon resurfaces
Almost 40 years after one of America’s
most famous mass murders, a second
weapon is detected and recovered
with marine geophysics.
By Graham Chandler

Aqua Survey Inc (ASI) was contracted by LA-based documentary-maker Ryan
Katzenbach who had been researching the infamous 1974 DeFeo family mass
murder in Amityville, New York.
I
t was the perfect horror classic. With stars like Rod Steiger, James
Brolin and Margot Kidder, and driven by the horrific true murder
story behind it, 1979’s The Amityville Horror was just one of a
series of blockbusters, most of them based on the subsequent
haunting of the house where it all happened. But of the original
1974 crime investigation by New York’s Suffolk County police
department, one thing was missing—a second murder weapon.
Now thanks to some sleuthing by documentary producer Ryan
Katzenbach and a detailed underwater electromagnetic survey
conducted by US-based Aqua Survey Inc, it has surfaced, quite literally.
Katzenbach is producing a three-part feature series entitled
Shattered Hopes, about the murders to which Ronald “Butch” DeFeo
Jr. confessed the day after. The official story is that he acted alone, in
a heroin- and alcohol-fuelled rage, in killing six members of his family
in their beds with just a .35-caliber Marlin rifle. Methodically, starting
with his abusive father. But other versions of the story are much more
complicated: it was hypothesized by some that Butch acted along
with his sister Dawn—who was shot by Butch the same night. For
this to happen there must have been another murder weapon. And
supporting that theory, among some discarded evidence found nearby

26 Earth Explorer Amityville Weapon Resurfaces.

was a handgun holster. But no handgun.
According to a feature story by writer Seth Porges that appeared
in the May 2012 issue of Maxim magazine, during his research of
(heavily redacted) police files and reports of the original investigation
Katzenbach had learned of ballistic and other evidence that strongly
suggested a .38-caliber handgun had been involved too. If so,
Katzenbach theorized the gun may have been thrown into the canal
that fronts the now-famous house.
But how to find it? Katzenbach engaged the services of Aqua Survey,
to undertake an electromagnetic survey of the canal. Aqua Survey
had the requisite skills. Their work, and expertise in ecotoxicology and
marine geophysics, has taken them everywhere from Cleopatra’s Palace
off Alexandria, Egypt, to the Bahamas, where they have helped hunt for
sunken treasures.
To narrow the search area and keep costs to a minimum, they
combined proven geophysical techniques with some deductive
reasoning. Aqua Survey owner and founder Ken Hayes explains their
approach: “First, we took chunks of asphalt that weighed the same
as a .38 handgun and pitched them into the canal. Then we added
about 25 feet, reasoning that the kid was on heroin and had just killed
six people, so there was a strong likelihood he had greater strength.”
That focused the search area down to about 125 feet directly out
from the bulkhead and approximately 200 to 300 feet in length. Towing
an electromagnetic time domain detection system behind their boat,
they then began the pattern. “Our survey lanes were one metre wide,”
says Hayes. “We used a DGPS (Differential Global Positioning System),
survey-grade GPS, set up for navigation and tracking control and, as they
say in the business, ‘mowed the lawn’.” The survey took less than five hours.
Next, Aqua Survey geophysicists performed an advanced computer
analysis on the targets in order to distinguish and prioritize them. Different
filters were applied to the data using Geosoft montaj UX- Detect, says From the 317 metallic targets found onsite, the ASI team narrowed the
Hayes. They ended up with over 317 metallic targets, so had to winnow possibilities down to a handful of targets to be investigated.
them down. “We could guess how thick the mud was there,” says Hayes.
So they took an actual handgun of similar size and weight, and scanned
it from incremental distances starting at one foot to see what a handgun
signature would roughly look like at various depths under the muck.
From that, “we narrowed the potential targets down to a probable ten,” he
says, “using the analysis and filtering tools in UX-Detect.”
“We were able to eliminate a whole lot of signatures to prioritize the
ten,” says Hayes. To accurately zero in on those so divers could locate a
suspected item, they made their own electromagnetic probe. “We used
it in real time,” says Hayes. “With it we went out with our precision GPS
and got onto the location. We were in about eight feet of water and
we knew the mud was four, maybe five, feet deep.” On each location
they would push the EM probe into the sediment until the target
was reacquired, because they could see the EM signatures on their
computers, on the boat, in real time. “Then we put the probe right on
the target—we knew when we were touching it—and the diving team
would excavate right down the probe pole. On just the third dig-out
the diver came up with a glob of mud; it was obviously metal by its
weight. “We washed it off, and the chamber and part of the barrel were
missing, but it was clearly a top-break snub-nose,” says Hayes.
There could be grounds for skepticism admits Hayes, but he’s
confident with their role in the discovery. “Do we know it was the gun
used in the commission of the crime?” he questions. “We don’t, but from
all the evidence this is where it was. We know the diver didn’t plant
it, and I know my guys didn’t. While we considered that the producer
might be pushing for sensationalism, it’s cost him money to fund the
survey with no guarantee of results.”
When the recovery team came up with the handgun, they had it for
all of about 20 minutes. “The Crime Scene Investigation people watched
our every move,” says Hayes “and it was promptly put into an evidence
bag and taken away by the Suffolk County Police Department.”
In the end, it was another experience for Aqua Survey to add to
their portfolio of geoscience detective work, and Hayes believes the
producer got what he wanted: “All of a sudden it’s no longer just a
movie, it’s a movie with a sensational story.” o Handgun electromagnetic signature grid generated in Geosoft UX-Detect.

Read online at www.earthexplorer.com Amityville Weapon Resurfaces. Earth Explorer 27

 Explorer seminars On-demand seminars cover a variety of topics

Simplify Geochemical Analysis within ArcGIS

Learn how you can effectively organize, validate, process and visualize
your geochemical data without leaving your ArcGIS environment.

When Seismic is not enough – Exploit the Potential of Gravity and Magnetic Data
Learn how and when to use your magnetic and gravity data to further leverage your seismic data,
improving depth models and defining or constraining geometry in challenging areas.

Birgit Woods Integrating Gravity and Magnetic Data into your Geophysical Portfolio
Technical Analyst,
Discover how you can seamlessly integrate, map and model your gravity and
specializing in Geology,
Geosoft Inc. magnetic data with your seismic data for greater discovery success. Explore proven,
low cost techniques to meet the growing demand for oil and gas supply.
Dr. Michal Ellen Ruder
President, Wintermoon
Geotechnologies Inc.
Maximize the value of your exploration data with Geosoft Target
Discover how Geosoft simplifies the life of today’s earth explorer by
providing access to data and a powerful set of mapping and analytical
Darren Mortimer tools with dynamic viewing capabilities in a 3D environment.
Technical Analyst,
specializing in Geophysics, Maximize the value of your exploration data with Target for ArcGIS
Geosoft Inc.
Learn how you can use Geosoft Target for ArcGIS to visualize drillhole
and borehole geology data and quickly integrate it with exploration
data within your ArcGIS environment.
Andrew Long
Technical Analyst,
specializing in Geophysics,
Geosoft Inc.

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28 Earth Explorer
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