For everyday retail investors, dissecting mining jargon and technical terms among company announcements can be challenging.
From established mining giants like billionaire Chris Ellison’s Mineral Resources (MIN) to junior miners and explorers, company updates tend to be filled with endless figures and drill results alongside complicated wording, making them difficult for the typical retail investor to understand.
ASX-listed companies often embark on fresh drilling ventures in a bid to make discoveries that could haul in massive rewards for its shareholders and directors.
According to UK-based market researcher AXORA, in mining, drilling has two main functions: exploration, to locate underground minerals and detect faults in nearby rock, and production drilling, to aid excavation and the extraction of the identified resource.
The main types of drilling programs include auger, rotary air blasting, aircore, reverse circulation (RC), diamond core and blast hole drilling. But what is the difference between these types of drilling, and what makes a hopeful explorer choose one over the other?
Exploring the different drilling methods
Auger drilling is the simplest form of drilling. It can be carried out by just two people using a rig that can be mounted onto a small vehicle, and it involves the manual rotation of a helical screw into the ground.
The aim is to cut and break the rock into pieces, finding an optimal place to mount a larger drill. Auger drilling is relatively cheap and quick, making it adequate for use as an initial geochemical reconnaissance technique.
Last year, Perth-based Taruga Minerals (TAR) conducted an auger drilling program at its Mt Craig project in South Australia. It helped set up geochemical profiles across new targets, paving the way for a follow-up RC drill program at the site.
For miners, the auger method is often marked as the beginning of exploration efforts.
Another shallow drilling method comes in the form of rotary air blast (RAB) drilling. This method uses a piston-driven piece of equipment — like a big hammer, in a way — to force the drill bit into the rock, creating rock fragments that are then lifted to the surface by compressed air.
While it’s another fast and efficient method of drilling, especially for drilling multiple holes in a short period of time, the air blasting process can compromise the quality of the rock, resulting in lower-quality samples.
In 2020, Dart Mining (DTM) posted “strong results” from a RAB drilling program at the Fairley’s prospect within its Buckland gold project in Victoria. The drilling extended the strike extent of gold mineralisation to 240 metres and returned several encouraging gold intersections.
Aircore drilling is most known for its ability to collect samples that are less susceptible to contamination.
It uses a three-bladed drill bit with a hollow drill rod to penetrate loose soil and rock fragments. On completion of the drilling, compressed air is blasted through the drill rod to bring the cuttings to the surface.
Junior explorer Iceni Gold (ICL) recently posted “positive” aircore drilling results from the Guyer North target within its 14 Mile Well project in Western Australia.
The drilling program highlighted a cluster of gold-anomalous holes correlating with the eastern contact of the Danjo Granite in the area.
While it’s considered to be slower than other methods such as rotary air blasting, aircore drilling often provides samples that are more representative of the prospective resources in the area and provide a more accurate reflection of what’s beneath the ground.
Diamond core drilling is the most expensive of all methods. In saying that, however, it produces the most accurate rock samples.
It uses a drill bit bolstered with industrial diamonds attached to hollow drill rods to extract a continuous cylinder of rock from deep below the earth. Through this method, the entire core of the mineral can be brought to the surface, as opposed to the small fragments associated with other methods.
Samples of the most accurate and representative form are likely to be achieved using a diamond core method.
Castle Minerals (CDT) embarked on a diamond core drilling program at its Kambale project in Ghana towards the end of last year in a bid to fast-track exploration work at the project. The company aimed to retrieve samples for phase-two test work.
The most popular method of drilling: Reverse circulation
With similarities to rotary air blasting and aircore drilling, reverse circulation (RC) is the most popular method for mining exploration.
RC drilling also uses a piston-driven hammer to drill into the rock, but larger rigs and machinery are often used to forge the drill further into the earth.
Compressed air is used to bring the fragmented earth to the surface. The method produces contaminant-free samples and involves less handling, making it more cost-effective and enabling faster turnaround times.
RC drilling is believed to have been invented in Western Australia and is said to have originated in Kalgoorlie in the mid-20th century.
For Sierra Nevada Gold (SNX), RC drilling was used when the company recently embarked on a drilling program at its New Pass gold project in Nevada in the United States. The program marks the first drill testing at New Pass in more than 40 years, testing vein positions down-dip and along-strike of the historical mining of high-grade epithermal gold mineralisation.
Boom: Blast hole drilling
Lastly, blast hole drilling is as basic as it sounds.
Holes are drilled into the earth, after which an explorer places and detonates explosive charges in the holes. Following this, the broken material is cleared to ensure safe human entry is possible.
Gas pressure blasting pyrotechnics might be used alternatively to displace the rock for excavation.
Why does this matter for investors?
Understanding the different types of drilling programs can provide valuable insights for retail investors when interpreting mining announcements and updates.
The phrase “do your own research” is often thrown around when discussing stock trading, but it can be difficult to conduct this research when companies hide crucial information behind technical jargon and geological patter.
By increasing one’s understanding of how drilling works, an investor can make more informed decisions when scouring through a company’s drilling results and trying to determine if it’s worth putting their hard-earned cash behind an explorer’s pipe dream.