1B. Bourne, Principal Consultant, Terra ResourcesM. Dentith, University of Western AustraliaA. Jumeau , Project Geophysicist, Terra Resources 21st February 2018(E) b.bourne@terraresources.com.au | (M) +61 409 493 485(W) www.terrapetrophysics.com.auPetrophysics and Exploration Targeting: The Value Proposition

2Outline

Petrophysics Nickel – Fraser Range Copper – Porphyry Gold - Carlin Summary

3Delivering solutions through collaborationUNCOVER Roadmap - Priority 1 - 10

Rank Program Type

1 Understand type, age & depth of cover (>$20M over 10 years for petrophysics) R, DC

2 Characterise distal mineral system footprint signatures R, DC3 Improve understanding of mineral systems R4 Build 3D architecture of Australian lithosphere R, DC5 Depth-to-basement -imaging from new airborne National AEM surveys DC, DA6 Acceleration of national AusLamp long period MT DA7 Geochemical dispersion in post mineralisation cover sequences R, DC8 Acquire approximately ~4km grid of gravity over continent DA

R- Research, T- Technology DC - Data Compilation, DA Data Acquisition

9 Targeted paleosurface horizon and basement re-sampling and new sampling via onshore National Stratigraphic Drilling Initiative NSDI

DC, DA

10 Australian seismic array ASA DC, DA

4Petrophysics – Rock Physical Properties Links the geologist’s view of the world with the geophysicist’s view– Chemistry → mineralogy → lithology– Density/magnetism/conductivity etc → geophysical response Significance – what is the geophysics telling us?– Mineral system concept has suggested many new geophysical targets: fluid/metal sources, fluid pathways, fluid reservoirs– Exploration under cover will use more geophysics but its interpretation will have less geological control(After Dentith et al, 2017)

5Petrophysics – A Way Forward? Datasets are often too small and lack adequate geological context– Lithology is not the primary control in many case– Petrophysical consequences of alteration– Scanners now available– More instruments readily available Predictive capability is generally poor Particular need to understand seismic and electrical conductivity and induced polarisation– Magnetotellurics, passive seismic, IP/resistivity(After Dentith et al, 2017)

6Petrophysics – A Conceptual Framework

(After Dentith et al, 2017)Texture(Geometric Relationships Between Minor Grains)Bulk(Overall Mineralogy)Grain(Volume, Size, Shape of MinorGrains)Lithology can be important, but this is not necessarily so Porosity is a major control on all physical properties (except magnetism)SeismicVelocityPara-magnetismDensity

7Nickel Geology– Greenstone stratigraphy (adjacent to seds)– Intrusive and extrusive ultramafic rocks– Associated with sulphides Petrophysics– Resistivity/ conductivity contrasts– Massive/Disseminated sulphides– Density, magnetic contrasts (in strat.)– Chargeability response– Velocity/ Acoustic impedance Airborne / Ground EM- Acquisition:- Various configurations (fixed/moving loop)- Target late time conductive responses AEM system

8Fraser Zone

9Fraser Zone - NovaNova (SRFR0017)• Intrusion: olivine gabbronorite, norite, anorthosite, lherzolite, wehrlite, websterite. All are low-porosity cumulates (low Zr, Ti, etc) --Main Gabbros are mostly non-cumulates Ultramafics up to 35% MgO Higher MgO, Ni and Cr seen elsewhere – may not be trueMost rocks are unaltered (very minor serpentinization)Mag Sus range (SFRD017, SI units): 0.01x10-3 – 13.2 x10-3(n=242 average = 2.2x10-3)• Form: Sills in metasedimentary rocks of Snowys Dam Formation

10Nova – Airborne Magnetics

Magnetic low associated with gabbroic/ ultramafic intrusives. Typical in the Albany Fraser Orogen Metamorphosed ultramafics in the Archaean are often serpentenised and form magnetite Uniformed explorers still chasing magnetic highs in the Fraser Zone (After Sirius Resources, 2014)

11Nova – Cross Section

(After Sirius Resources, 2014)

12Nova - Exploration With the use of petrophysics we can ask practical exploration questions like, what is the effective depth of investigation of EM when searching for deep Nova-like targets? Tx Current using 50,100 and 200 amps, reflecting range of available transmitter systems RX sensor noise 3pT typical for fluxgate and 0.5pT typical for SQUIDs Based on Nova style mineralisation 200 x 200m body, 8000S conductivity at depths of 100, 300 and 600m depth to top with 0, 45 and 90 degree dip Overburden 100m thickness of 10 and 100 ohm resistivity in a 400 ohm host

13 And yes using petrophysics (and some modelling) you too can determine whether you can find Nova up to depths of 600m using current technology… Nova - Exploration

14Porphyry – Various Methods

Geology– Porphyries form in various settings– Usually at convergent plate margins – Commonly hosted in volcanics or sediments – Au in centre of porphyry system Petrophysics– Magnetic, electrical & potassium contrasts– Alteration zonation– Response varies depending on host– Disseminated sulphides Various geophysical methods- Acquisition:- 1) Regional airborne mag & radiometrics- 2) Follow-up airborne EM- 3) IP/resistivity methods (100-200m dipoles) Thompson (2004)AEROTEM IV system

15Porphyry – Geological Cross Section 1km NChargeable AnomalyResistivity AnomalyPotassium AnomalyS Magnetic Anomaly500mOuter Propylitic Propylitic(Howe and Kroll, 2010)

16Porphyry – Integrated Example

K-silicate core– magnetic– resistive Phyllic alteration– resistive – chargeable Propylitic alteration– chargeable – magnetic Outer propylitic alteration– Potassium anomaly 1 km(Howe and Kroll, 2010)

17Alumbre Project – Induced Polarisation

(After Promesa ,2014)

18Porphyry - Induced Polarisation

(After Pelton ,1977)

19Magnetic Remanence - Causes

Mineralogy/Lithology– Fine grained magnetite (<20μm) eg rapidly chilled basalt, oxidised mafic intrusions (titanomagnetite)– Monoclinic pyrrhotite Alteration– Skarn– Hornfelsing– Or any processes resulting in above Magnetisation History– Systems that develop during long periods of consistent geomagnetic polarity much more likely to exhibit remanence-influenced signatures– Cretaceous Normal Superchron ~118 Ma to 83 Ma– Permo-Carboniferous (Kiaman) Reverse Superchron ~315 Ma to 260 Ma

20Implications for Porphyry Exploration Most porphyry system magnetite is coarse-grained, therefore remanence < induced During age of mineralisation, earth’s field direction was changing and multiphase intrusions/thermal events would be overprinted after each event cancelling out any likely effects of remanence Therefore there should be no known world class porphyry deposit with dominant remanent effects Only likely source of remanence features in younger terrains are oxidised mafic intrusions and skarns Co-magmatic mafic events likely with world class porphyry districts

21Implications for Porphyry ExplorationPorgera,Mt KareWafi Golpu Ok Tedi FriedaYandera Black = Normal White = ReversedElandora AkunaAgua RicaBajo de Alumbrera Cerro CasaleGrasbergBatu HijauFSE Panguna Los PelambresEl TenienteLos Bronces Minas Conga

22Alumbre Project - Magnetic Inversion (MVI/ASA)

Modelled magnetics with +10x10-3 SI* isosurface from the 3D MVI inversion in pink and IRI standard inversion in blue.Magnetics (pink) – Isosurfacesof susceptibility, +10 x 10-3 SI* in pink. (After Promesa ,2014)

23Alumbre Project - Modelling / CopperMagnetics (pink) – Isosurfaces of susceptibility, +10 x 10-3 SI* in pink. Centre +15 x 10-3 SI* in red, equivalent to +0.5% magnetite. (After Promesa ,2014)

24Carlin Gold - Nevada Hot Spot +250 Moz in Carlin deposits in area 200 x 400km ~5% of world Au production Distributed along “Trends”Top 5 Moz Au g/tGoldstrike 55 8.6Getchell-TR 26 7.1Gold Quarry 24 1.2Twin Creeks 17 2Goldrush 14 4.2 Carlin deposits> 10 Moz5-10 Moz1-5 Moz<1 Moz 100 kmGoldrush(After Townsend et. al., 2010)

25Carlin - Deposit Characteristics Favorable rocks(sink for gold)Conduit structure(plumbing)Seal

After Robert 2010 – Scale 5km across

26Carlin - Petrophysics

No stand out geophysical method for Carlin-style gold mineralization Petrophysical generalisations of typical Great Basin rocks:H = High, M = Moderate, L = Low Overprinting structural, alteration and metamorphic events inherently causes highly variable petrophysical properties ….but then how do we explain the following (After Townsend et. al., 2010)

27Getchell/ Turquoise Ridge (26 Moz)

(After Howe et al., 2014)MT cross west to east cross section with deposit location(red) and the Getchell Fault (green) overlain

28Getchell/ Turquoise Ridge (26 Moz)

(After Howe et al., 2014)Box and whisker plot of resistivity variation compared tologged lithology. The black dot represents the mean, the solid line the median, and the coloured lines the data range

29Getchell/ Turquoise Ridge (26 Moz)

(After Howe et al., 2014)Box and whisker plots comparing typical Carlin type alteration with resistivity

30Getchell/ Turquoise Ridge (26 Moz)

(After Howe et al., 2014)Downhole resistivity histogram coloured by Au grade

31Getchell/ Turquoise Ridge (26 Moz)

Howe et al., 2014 Comparison of the geological and petrophysical datasets demonstrate that no single variable can be invoked as a control on resistivity Rather, multiple factors contribute to the apparent resistivity of any given volume of rock within the model Porosity and specific types of alteration display the strongest correlations with resistivity and furthermore can be tied to gold distribution

32(After Zhdanov, 2012) The effective conductivity of rocks and fluids is not necessarily a constant and real number but may vary with frequency and be complex (i.e., the IP effect) The new generalized effective medium theory of induced polarization (GEMTIP) provides a unified mathematical model of heterogeneity, multi-phase structure, anisotropy, and polarizability of rocks and fluids (Zhdanov, 2008, Geophysics) Geometric factors (pore space model) – Grain shape – Grain eccentricity – Grain size – Fraction volume % (porosity) – Grain alignment (anisotropy) Formation (reservoir) parameters – Matrix resistivity – Grain resistivity – Grain polarizability GEMTIP - Generalized Effective Medium Theory of Induced Polarization

3310-2 100 102270280290 Frequency (Hz)Real effective Resistivity (Ohm-m) 10-2 100 1022468101214 Frequency (Hz)Imaginary effective Resistivity (Ohm-m) 0.2 mm0.5 mm0.7 mm1 mm1.2 mm1.5 mm2 mm3 mm (After Zonge, 1978)IP Response of Pyrite Bearing Rocks

34 Maximum IP frequency plotComparison between the theoretical (GEMTIP) and lab dataPlots of complex effective resistivity obtained by GEMTIPIP Response of Sulphide Bearing Rocks

(After Ostrander and Zonge, 1978)

35GEMTIP – Hand Samples (AMIRA P1058)

36Summary Petrophysical data are potentially very useful for both testing and generating ideas about geophysical exploration strategy– More than just a guide for modelling geophysical responses Uncover and mineral systems: a need to better understand what controls physical properties and develop a predictive capability– Think beyond lithology – consider alteration and porosity

37B. Bourne, Principal Consultant, Terra ResourcesM. Dentith, University of Western AustraliaA. Jumeau , Project Geophysicist, Terra Resources 21st February 2018(E) b.bourne@terraresources.com.au | (M) +61 409 493 485(W) www.terrapetrophysics.com.auPetrophysics and Exploration Targeting: The Value Proposition