Executive Summary

Australia's Identified Mineral Resources is an annual national assessment that takes a long-term view of mineral resources likely to be available for mining. The highest category in the national inventory is Economic Demonstrated Resources (EDR) which, in essence, combines the Joint Ore Reserve Committee (JORC) Code categories of Ore Reserves and most of the Measured and Indicated Resources. JORC Code Ore Reserves of commodities are included for comparison, which provides a short to medium-term view of mineral stocks. The assessment also includes evaluations of long-term trends in mineral resources, world rankings, summaries of significant exploration results and brief reviews of mining industry developments.

Australia's EDR for the following 20 mineral commodities increased during 2011 - antimony, black coal, brown coal, cobalt, copper, gold, iron ore, lead, lithium, manganese, niobium, phosphate rock, platinum group elements, rare earth oxides, rutile, silver, tantalum, uranium, zinc and zircon. However, during the same period there was a decrease in the EDR for five commodities: diamonds, ilmenite, molybdenum, tin and vanadium. EDR for bauxite, chromium, fluorine, magnesite, nickel, shale oil, thorium and tungsten remained at levels similar to those reported in 2010.

Australia's EDR of gold, iron ore, lead, rutile, zircon, nickel, uranium and zinc are the world's largest, while antimony, bauxite, black coal, recoverable brown coal, cobalt, copper, diamond, ilmenite, lithium, manganese, niobium, silver, tantalum, tungsten and vanadium all rank in the top six worldwide.

Australia's EDR of bauxite were estimated to be some 5665 million tonnes (Mt) in 2011 (unchanged from 2010), ranking second in the world behind the Republic of Guinea and ahead of Brazil, Vietnam, Jamaica and India. Australia was the world's leading producer of bauxite and alumina in 2011 and the fifth largest aluminium producer. Australia's aluminium industry continues to be a highly integrated sector of mining, refining, smelting and semi-fabrication and is of major economic importance nationally and globally. Australia's aluminium industry is underpinned by vast resources of bauxite at Cape York in Queensland (Qld), at Gove in the Northern Territory (NT) and in the Darling Range southeast of Perth in Western Australia (WA). Rio Tinto received State approval for its South of Embley project in Qld, which will extend the Weipa operations by up to 40 years.

In 2011, the estimate of Australia's recoverable black coal EDR was revised upwards from the 2010 total by 17% to 57 538 Mt. The resource constitutes 6% of the world's recoverable black coal EDR. Globally, Australia is ranked fifth behind the United States, the Russian Federation, China and India in terms of recoverable economic coal resources. Most of these resources are located in Qld (61%) and New South Wales (NSW; 36%). The Bowen Basin in Qld and the Sydney Basin in NSW dominate black coal production in Australia and contain 65% of the nation's recoverable black coal EDR. Significant black coal resources are also found in the Surat, Clarence-Moreton and Galilee Basins (Qld) and in the Gunnedah Basin (NSW). At 2011 rates of production, Australia's black coal EDR will support 125 years of production.

Between 2010 and 2011, the estimate of Australia's recoverable brown coal EDR (44 219 Mt) remained unchanged. Approximately 19% of the world's recoverable brown coal resources are located in Australia and the nation is ranked second behind the United States in terms of recoverable brown coal EDR. All of Australia's recoverable brown coal EDR is located in Victoria (Vic) with approximately 93% in the Latrobe Valley. During 2011, brown coal production in Australia was estimated at 66.7 Mt. Brown coal mined in Australia is used almost exclusively for domestic electricity generation and at current rates of extraction the resource base will support 663 years of production.

Australia's EDR of copper rose by one million tonnes in 2011 to 86.7 Mt, an increase of 1%. Australia has the third largest economic resources of copper at 13% after Chile and Peru. South Australia (SA) has 67% of the national total, mainly in the Olympic Dam deposit, followed by Qld with 13% and NSW with 12% of EDR. In 2011, mine production of copper rose by 10% and exports totalled $8.6 billion, up 14%. Spending on exploration rose by 51% with expenditure in SA and Qld accounting for 33% each of all copper exploration expenditure. New copper mines approaching first production in 2011 were Cadia East (NSW), DeGrussa (WA) and underground at Prominent Hill (SA). Studies into a major expansion for Northparkes (NSW) were commenced and the major expansion for Olympic Dam (SA) was delayed to investigate a less capital-intensive design. Copper mines recommencing production in 2011 included Lady Annie (Qld), Mount Gordon (Qld), Osborne (Qld), Kanmantoo (SA) and Mineral Hill (NSW).

Diamond production continued at the Argyle and Ellendale mines in WA throughout 2011, with a total of 7.6 million carats (Mc) produced. Australia's EDR of diamonds decreased by 7% in 2011 to 272.5 Mc. The Argyle diamond mine continues to dominate production and hosts most of Australia's EDR of diamonds.

Australia's EDR of gold in 2011 was 9153 tonnes, an increase of 9% over 2010. Australia had the world's largest resources of gold by country with 17% of the estimated total, while South Africa with 6000 tonnes and Russia with 5000 tonnes had the second and third largest shares, respectively. EDR rose in all States and the NT and WA continued to dominate the national resource inventory with 4058 tonnes or 44% of the total. South Australia with 2731 tonnes and NSW with 1645 tonnes contributed the next highest tonnages of metal in resources. Gold production for the year fell minimally by 2 tonnes to 258 tonnes while export of refined gold also fell from 330 to 308 tonnes. Gold prices rose during the year from at about US$1400/oz to US$1600/oz and coincided with increased exploration expenditure on the commodity of $85 million, bringing the annual total to $709 million for 2011.

Because of major changes in Australia's iron ore mining industry and the development of large magnetite deposits in Australia, Geoscience Australia has estimated national resources of iron in two categories:

  • Iron ore (tonnes)
  • Contained iron (Fe) (tonnes).

EDR of iron ore increased by 9% to 37 762 Mt during 2011 with the EDR of contained Fe estimated to be 18 152 Mt. Western Australia has the largest share of these resources with 94% of Australia's EDR, the majority of which is in the Pilbara region. Australia has the world's largest EDR with 22% of the world iron ore. This is followed by Brazil with 17% of the world EDR. Western Australia produced 474 Mt, or 97% of Australia's total production of iron ore in 2011. Iron ore exploration expenditure in Australia for 2011 totalled $905.3 million, a 64% increase on the $553.1 million spent in 2010. Exploration on iron ore for 2011 also accounted for 25% of Australia's total mineral exploration expenditure.

Australia's EDR of lithium increased by 208% to 1006 kilotonnes (kt) in 2011, ranking it third largest globally, with 7.7% of the world's economic resources. All of Australia's EDR of lithium occur within hard rock pegmatite deposits in WA. The bulk of the increase in Australia's EDR of lithium reflects a large addition to resources at the Greenbushes spodumene deposit, the world's largest and highest grade spodumene deposit.

Australia's EDR of magnesite totalled 330 Mt representing about 4% of the world's economic resources of magnesite. South Australia has the largest share of these resources with 71% followed by Qld with 19%. The Kunwarara deposit in Qld is the world's largest known resource of ultrafine-grained cryptocrystalline to microcrystalline nodular magnesite.

Australia's EDR of manganese ore increased by 7% to 197 Mt in 2011, ranking Australia's resources as the world's fifth largest. The bulk of the EDR occur in the NT and WA. Australia's mine production of manganese ore reached record levels of 7 Mt in 2011, and is ranked second behind China.

The regions containing the major proportion of Australia's mineral sands resources (ilmenite, rutile and zircon) are the Perth Basin north of Perth in WA, the Murray Basin (NSW, Vic, and SA) and the newly emerging heavy mineral sands regions in the Eucla Basin (WA and SA). In 2011, EDR decreased by 5.3% to 188.9 Mt for ilmenite, increased by 18.3% to 46.6 Mt for zircon and increased by 15.7% to 27.2 Mt for rutile. Australia's rutile and zircon resources are ranked number one in the world, while ilmenite resources are the second largest worldwide behind China.

Australia's EDR of molybdenum decreased by just under 50% to 167 kt in 2011, ranking it eighth globally with 1.7% of the world's economic resources. The decrease in Australia's EDR largely reflected the current uneconomic status of Australia's largest molybdenum deposit at Spinifex Ridge in WA.

Australia's EDR of nickel, which at 26.8% is the world's largest, decreased by 13.8% from 24.0 Mt in 2010 to 20.7 Mt in 2011. Western Australia remains the largest holder of nickel resources with 90.7% of total Australian EDR made up of both sulphide and lateritic deposits. Nickel production resumed in 2011 at the Ravensthorpe lateritic nickel mine and at the Maggie Hays sulphide deposit.

Australia's EDR of niobium increased by 53% to 205 kt in 2011, ranking Australia the second largest in the world behind Brazil. The bulk of the EDR are associated with the Toongi deposit, 20 kilometres south of Dubbo in NSW.

Changes in the phosphate mining industry have resulted in Geoscience Australia estimating national resources of phosphate in two categories:

  • Phosphate rock
  • Contained P2O5

Australia's EDR of phosphate rock almost doubled to 945.4 Mt from 492.1 Mt in 2010. Ninety-three percent of Australia's EDR occurs as sedimentary phosphate rock (phosphorites) in the Georgina Basin at Phosphate Hill, Paradise South and Paradise North in Qld and at Wonarah, Nolans Bore and Ammarroo in the NT. Australia has less than 1% of the world's economic resources of phosphate rock.

Potash is a generic term covering a variety of potassium-bearing ores, minerals and refined products. Potash is not mined in Australia, which has only modest resources by world standards. Australia's fertiliser requirements are met through phosphate rock production and imports of potassium fertiliser. Ongoing exploration in recent years has led to recent published resources for some deposits such as Lake Disappointment, Lake Chandler and Dandaragan Trough/Dinner Hill deposits in WA, in the WA/NT portion of Lake Mackay and in the Karinga Creek Salt Lakes area in the southern NT.

Australia's EDR of rare earth oxides in 2011 were 2.03 Mt which increased from 1.83 Mt in 2010. Significant resources of rare earths are contained in the monazite component of heavy mineral sand deposits, which are mined for their ilmenite, rutile, leucoxene and zircon content. Currently, extraction of rare earths from monazite is not viable because of the cost involved with the disposal of thorium and uranium present in the monazite.

Shale oil resources predominantly occur in a series of sedimentary basins near Gladstone and Mackay and further north near Proserpine in central Qld. Australia currently has no EDR of oil shale, with all resources being assessed as subeconomic. A small-scale technology demonstration Paraho IITM oil shale processing retort near Gladstone, Qld, produced its first crude oil in September 2011.

Australia's EDR of tantalum increased by 17% to 62 kt in 2011, ranking Australia the second largest in the world behind Brazil. More than 92% of the EDR are located in WA and are associated with the Greenbushes and Wodgina deposits.

Australia's EDR of tin increased slightly (by 6%) to 243 kt in 2011, ranking Australia's resources as the world's eighth largest. Just under 80% of Australia's EDR of tin are contained in the Renison Bell deposit in Tasmania.

Australia's EDR of tungsten in 2011 was 376 kt, similar to 2010 levels, ranking it the second largest globally with 11.4% of the world's economic resources. Half of Australia's EDR is contained within the O'Callaghans multi-commodity deposit in WA.

Australia's uranium resources are reported in the categories of the international classification scheme for uranium. Reasonably Assured Resources (RAR) that can be produced at costs of less than US$130 per kilogram (kg) are equivalent to EDR (Australia's National Scheme). Australia's RAR of uranium that can be produced at costs of less than US$130/kg at December 2011 were estimated to be 1196 kt, which was an increase of 3% on the estimates for 2010. Costs of mining and milling uranium ores have increased during the past few years and, as a result, resources in many uranium mines and deposits are now assigned to higher cost categories compared with the estimates for 2009 and 2010. During 2011, the Honeymoon in situ recovery uranium mine commenced production.

Australia's vanadium EDR declined by 14% in 2011 to 1519 kt. This represents approximately 2.5% of estimated global vanadium resources, ranking Australia fourth in the world. The economic impacts of volatile prices and the nature of the vanadium market, which is supplied largely from secondary sources, has a significant impact on Australia's vanadium EDR and the development of Australian vanadium projects. The bulk of Australia's vanadium is located in WA and Windimurra, reopened in 2011, is the only producing vanadium mine.

Australia's total resources of zinc, lead and silver rose moderately in 2011. Zinc resources were up by 4%, lead by 3% and silver by 5%. Exploration expenditure for zinc-lead in 2011 was 24% higher than in 2010 at $84 million. Australia's EDR of zinc, lead and silver in 2011 totalled 68 Mt, 36 Mt, and 88 kt respectively.

Resources to production ratios: Ratios of Accessible Economic Demonstrated Resources (AEDR) to current mine production provide indicative estimates of the resource life. AEDR of most of Australia's major commodities can sustain current rates of mine production for many decades. Resource life based on ore reserves is lower, reflecting a shorter term commercial outlook.

Prior to 2008, there had been a significant trend towards lower AEDR/production ratios for coal and iron ore: a result of major increases in production and reassessment of resources. The decline in iron ore prior to 2008 has been increasingly offset in the past few years by the development of large magnetite iron ore deposits in the Pilbara and mid-west regions of WA. These magnetite resources, which were previously considered to be subeconomic, have been re-assessed as economic.

Commodities with resource life duration of less than 50 years are manganese ore (about 15 years at current rates of production), diamond and gold (35 years) and zinc (45 years).

The severe world financial crisis in late 2008 highlighted the fact that a long resource life for a particular commodity is not a guarantee that such resources will continue to be exploited in Australia. In an increasingly competitive and globalised commodity market, multinational mining companies are continuously seeking mineral deposits that will provide attractive returns on their investment. Such returns are influenced by the quality of the resources (grade and tonnage) as well as environmental, social and political factors, land access and the location and scale of competitor projects. Individual mine projects in Australia will be ranked by multinational companies against the investment returns from other deposits worldwide.

Australia's continuing position as a premier mineral producer is dependent on continuing investment in exploration to locate high quality resources and/or upgrading known deposits to make them competitive on the world market, as well as investment in beneficiation processes to improve metallurgical recoveries.