Resource Drilling of the Solwara 1 Seafloor Massive Sulfide (SMS) Deposit

Abstract

Abstract Nautilus Minerals is the world leader in exploration and development of deep ocean seafloor massive sulphide (SMS) resources. The company is currently focused on generating its resource pipeline in the Western Pacific and its first development project for recovery of high-grade copper, gold and silver mineralisation from its Solwara 1 site in the Bismarck Sea, Papua New Guinea. The Solwara 1 site is located at a water depth of 1,600 - 1800 meters. Over 150 SMS seafloor surface samples have been collected from chimney structures during dives made by remote operated vehicles (ROVs). In order to obtain an understanding of the sub-surface mineralisation, Nautilus carried out 3 drilling programs between 2006 and 2008 which allowed the calculation of a Canadian NI43-101 compliant resource estimate. The initial 2006 campaign was based on conventional offshore surface driven drill equipment. In conjunction with the subsea remote technology industry, Nautilus subsequently developed an ROV operated seafloor drill system with improved drill core recovery and efficiency. This technology was developed further with a 2010 drill program to increase the available geological knowledge at Solwara 1 and adjacent prospects. This paper will provide an overview of Nautilus' SMS drilling requirements and recap the evolution of drilling technology and operations undertaken at Solwara 1 from 2006 to 2010. The paper will also discuss the potential of further developments in drilling techniques and equipment to increase or improve drilling depth, efficiency and data quality. Introduction Nautilus Minerals is a leader in the exploration and development of Seafloor Massive Sulphide (SMS) systems. These high grade copper, gold and zinc deposits are considered to be modern analogues of ancient volcanogenic massive sulphide (VMS) deposits. In the western Pacific, Nautilus Minerals is predominantly engaged in exploration for SMS systems in the territorial waters of Papua New Guinea and the 1887 Proclamation Area of Tonga. Nautilus Minerals development plan is to commence production at its Solwara 1 site located within Mining Lease (ML) 154 in the Bismarck Sea, Papua New Guinea. As of January 2011, the Solwara 1 prospect has a NI 43-101 compliant indicated and inferred mineral resource estimate of 870 kT and 1,300 kT respectively. SMS systems are typically located in water depths greater than 1,000 metres and in close proximity to tectonic plate boundaries and submarine volcanic activity. Cold seawater which has entered the earth's crust is heated to high temperatures by volcanic and magmatic processes, forming hot hydrothermal fluids, which can become rich in economic metal concentrations. These hot fluids are driven to the seafloor by convection, producing hydrothermal plumes or " black smokers??. SMS systems are formed by the precipitation of metal bearing sulphide minerals as chimneys, which range from mere decimetres to a few metres in diameter and can reach up to 20 metres in height. The continued process of chimney build-up, extinction, renewal and collapse can lead to the formation of sulphide mounds, which can be hundreds of metres in lateral extent (Figure 1).