Not just for indigestion commercial kaolin white (white firing) non-swelling clay Also called “China Clay”

KAOLIN

• NOT JUST FOR INDIGESTION….

COMMERCIAL KAOLIN

• White (white firing) non-swelling clay - Also called “China Clay”

• Dominantly kaolinite

• World Production 30mtpa (US$3b)

• Export markets 9mtpa

USES OF KAOLIN

Commercial Economics PREMIUM GRADE CRITERIA

• A high priced Kaolin has :

• Superior Brightness

• Superior Whiteness

• Desired particle size

• High opacity (good hiding power)

• Chemical purity

• Low viscosity (for paper markets)

• Other properties - abrasivity, conductivity, etc

Pigment markets - Brightness Competitors

• Pigment Price per tonne (A$)

• TiO2 $3500 - $6000

• CaCO3 $350 - $500

• Kaolin $200 - $1200

• Kaolin gives good performance for the price

Markets - Paper Demand

• Paper demand increases with GDP

• Asian paper production to overtake USA by 2010*

• Asia imports Kaolin from:

• Georgia Brazil UK

• * Source: Pulp and Paper Magazine

KAOLIN FORMATION

• Economic deposits mainly weathering related

• Associated with laterite and bauxite

• Formed in wet/dry tropical climate

• Over 1500m rain pa

• Leaching process

LATERITIC WEATHERING

MORE EFFECTIVE LEACHING

• More water flow (fresh water & permeability)

• More time

• More bugs

• Acid groundwater (oxidising organics)

• Parent is only important if time is short or leaching is slow.

REMOVAL OF IRON

• Ferrous leached more easily than ferric.

• Least iron just below lowest water table

• But leaching is slow below the water table

• Organic grey kaolins formed here.

DIAGENESIS OF KAOLIN

• Feldspars & clays kaolinite

• Kaolinite increases in grain size

• The perfect kaolin recipe - Formed below water table then raised above it

SEDIMENTARY KAOLINS?

• Cannot separate kaolinite from other clays by sedimentation.

• All commercial kaolins are formed in situ (Pickering & Hurst 1997)

• Ball clays? (70% disordered kaolin).

SKARDON RIVER KAOLIN - discovery….

• Andrew White in 1985

• 19 holes

• 2 in lease

• Target of “Bulimba” kaolin found;

• Older weathering kaolin noted.

• Samples to CSIRO

SKARDON RIVER KAOLIN - exploration history pre SRK

• 1986 - Drilled 93 holes - geology only

• 1987 - 1990 Bulk sampling & testwork

• 1993 - 188 RC holes - geology & ‘clay’

• 1994 - 10 DD holes

• 1994 - 97 - Testing selected drill samples

• 1997 - 207 RC holes - poor control

MISTAKES…..

• No initial raw values

• Did not relate metallurgy to geology

• Poor technical knowledge at board level

• Moving goal posts

• Rolls Royce plant

• Major cost over-runs

• No coordination of consultants/contractors

GEOLOGICAL HISTORY…..

Uplift and Weathering...

Tertiary Sheet Fluvials

Weathering to bauxite

Fluvial Channel Develops

Further Weathering…...

Claystone Mining

Conchoidal claystone

Fluvial in exploration pit

ML and Drilling

RESOURCES

Resource Summary

Skardon Kaolin Properties

Skardon Product Range

• Hydrous Kaolins

• Plant capacity 75,000 tpa
• Wide range of industrial applications
• Represents the bulk of world supply
• Target of paint & rubber markets

Stage 1 Processing: Wet Plant

Stage 2 Processing: Dry Plant

MAJOR WORLD DEPOSITS

• Georgia, USA

• Amazon, Brazil

• Cornwall, UK ……….the odd one out

• Hercynian granite 280mA
• Debate weathering vs hydrothermal
• Coarse grained well crystallised kaolin
• Very limited available resources
• Product yield 15-20%

Georgia - Geology

• Cretaceous and Tertiary bedded kaolins

• Exposed just south of Fall Line

• Cap bentonite

• Cretaceous 60% -2micron

• Tertiary 85% -2micron

Georgia - Economics

• ADVANTAGES

• Two types of kaolin

• Expertise

• Reputation

• Transport for E USA & Europe

Amazon Geology

• Under bauxite exposed on slopes.

• Rio Jari – Pliocene, very fine grained 75% -2 micron. 36m thick deposit.

• Rio Capim – also Tertiary. Coarser than Jari. Thinner and some grit.

Amazon Economics

• ADVANTAGES

• Fine Kaolin

• Modern plant

Summary of the Skardon River Kaolin Project

• Long mine life

• Growing international demand

• Premium products

• Exceedingly low CAPEX entry price

• Best logistics for Asia

• Marketing and distribution agreements

• Technical Management Expertise