Tempest Minerals: still not doing dogma

This article is a sponsored feature from Mining.com.au partner Tempest Minerals Limited. It is not financial advice. Talk to a registered financial expert before making investment decisions.

Make no mistake, exploration is a numbers game. It’s the realm of chance, estimation, tenacity and, of course, luck.

“One in a million projects becomes a mine,” says Don Smith, Managing Director of Tempest Minerals (ASX:TEM).

“It’s a bit of a catchphrase, but it’s also close to numerically accurate. About 1 in 1000 projects has anything at all, and then 1 in 1000 of those becomes a mine. It’s a really hard game.”

Flip a coin and land on heads 20 back-to-back times and you’d be in the same ballpark, odds-wise. So it’s perhaps with such narrow margins in mind that Smith does not play things one egg at a time.

“You can’t just have one egg in the basket. You’ve got to have multiple. If you have lots of targets and you test them all, eventually you’ll find something. It’s about increasing the chance of finding something and that’s what the Five Wheels Project is about.”

Adventures in eggs-ploration

Perth-based Tempest owns a portfolio of precious, base, and energy metal assets across Western Australia, as well as hefty interests in other projects in Papua New Guinea, Africa, and the US.

Those in WA include the wholly owned Yalgoo Project, with its Messenger, Meleya, Warriedar West and Euro properties, as well as the Range Project in Mt Magnet.

Overseas, Tempest has exposure to the Tonopah Lithium Project in Nevada through Argosy Minerals (ASX:AGY), as well as other assets in Africa through a stake in Premier African Minerals (LON:PREM). In Papua New Guinea, the company has a substantial interest in privately held Tolu Minerals, which owns the Tolukuma and Mt Penck projects, and is scheduled to begin trading on the ASX in October.

But it was this year that Tempest took a step towards true egg profusion, announcing in July its intent to acquire the Five Wheels Base Metal Project in Western Australia’s Earaheedy Basin. 

“It’s a great area, the Earaheedy Basin

The 266km-square of exploration-ready tenure sits roughly 36km from Rumble Resources’ (ASX:RTR) Chinook deposit, which made headlines in April 2021 after delivering a 34m interval at 4.22% zinc and lead. Considered one of the largest zinc sulphide discoveries to be made globally in the last 10 years, Chinook now hosts a resource measuring 2.2 million tonnes of zinc, 700,000 tonnes of lead, and 12.6 million ounces of silver.

“It’s a great area, the Earaheedy Basin,” Smith says.

“Rumble Resources and Strickland Metals (ASX:STK)” — with its Iroquois Project — “have both been hitting a lot of mineralisation there over the last couple of years and that’s really opened up the whole region. And that’s how we’re going at it — there are more opportunities there than were previously realised.”

But even before the Chinook discovery, Tempest had been eyeing the Earaheedy Basin, partly for its relative proximity to Sandfire Resources’ (ASX:SFR) DeGrussa Copper Operation, which produced up to 300,000 tonnes of high-grade copper each year from 2013 to 2022, when it closed down.

“We sort of looked at areas where you could find that kind of stuff and Earaheedy was one of them,” Smith says.

But if eggs are the metaphor of choice here, let’s start talking in terms of omelettes. Only a month after the Five Wheels news, Tempest announced its plan to add another project to its portfolio: the Elephant Project in Western Australia’s Fraser Range.

Located on the periphery of the Albany Fraser Belt, the 194km-square project features coincident geochemical and geophysical targets with a footprint comparable to other world class gold deposits in the region, according to an August 16 announcement.

“Similarly to Five Wheels, the Elephant Project is in a hot region, the Fraser Range, which is where the Nova-Bollinger discovery was made, which is now IGO’s (ASX:IGO) main project,” Smith says.

“Also, you’ve got the Tropicana mine, which is the giant AngloGold Ashanti (NYSE:AU) and Regis Resources (ASX:RRL) gold mine. They’re all on this same trend and we’ve just picked up another couple of hundred square kilometres along that trend.”

The nearological factor

When discussing exploration, reference is often made by junior players to the ‘nearology’ factor: the idea that prospective ground is most easily found close to existing discoveries.

“Nearology helps people find stuff. You go look in the same area, that certainly increases your chances of finding things,” Smith explains.

“No one cared about the Fraser Range, frankly, until Tropicana was discovered circa 2004. And that opened up a new geological theory because the rocks at Tropicana — it’s huge, 12 million ounces or something — those rocks are different in that they’re younger. So instead of everyone looking for a particular age of rock, now they can look for younger ones as well.

“Nearology helps people find stuff. You go look in the same area, that certainly increases your chances of finding things

“Earaheedy is the same. There was no one there, then Rumble made its discovery, now every man and his dog has pegged ground there.”

If such strategies have been successful, a large portion of that success is owed to the unrelenting trudge of technological development. Countless innovations over the last few decades have conspired to make prospective ground much more accessible, and exploration work quicker, easier, and generally more efficient. But there is a component based on timing, too.

Periods of regional hubris, Smith says, make poor occasions for entry.

“It’s better to wait for it to cool down,” he adds.

“You’re either there right when a discovery is made, or you give it a bit of time and then come back and do a strategic entry. And that’s what we’ve done at both Five Wheels and Elephant.”

Those on the more discerning side of exploration have waited until the market is at — or near — the bottom. Likewise, those merging, selling or somehow winding back their acquisitions “haven’t planned for the downturns and the rainy days.”

“They’ve just jumped in when the market’s hot and now they’ve run out of money, or run out of resources or whatever, when things have gone down. And I’ve been very cautious not to fall into that trap.”

In any case, Tempest’s methodic resolve to nurture its egg basket is indeed a unique one. Compared to those of other explorers, the strategy marks a clear point of distinction; a retreat from the current trend that’s seen many companies offload non-core assets in a bid to narrow their focus. 

That Tempest’s approach is different does not make it unwise or fruitless. To think so would be to ignore the company’s successes to date. Rather, it suggests the underlying imperative is effective management — an area to which Smith has devoted a great deal of thought.

Departures from dogma

“That’s one of the things we really focus on — efficiency,” Smith says.

“We try not to go and do random work and waste money. It’s about making the right choices.”

In aid of prudent decision-making, Smith has devised a system to rank Tempest’s assets according to their various qualities.

“The strategy is to always — at Yalgoo in particular, because it’s such a big project, more than 1000km-square — always to look at the big picture. Look for areas that are prospective, collect as much data as we can about each one, and then put it into a ranking system, which is a calculation we use. It’s numerical, but it can be qualitative as well. We try not to be emotive about it.”

Built into the system are between 8 and 10 “big categories” — including environment, social and native title — for which each project or target receives a score out of 10. Then there are those on the more technical side, such as geology and infrastructure.

“If it’s a project that’s out in the middle of the desert away from anything, it’s going to get a 0 for infrastructure, but it might get a 10 for geology,” Smith explains.

“At the end, you get a total number and you say: Okay, according to all the criteria, this project has the best number. That’s usually — unless there’s some other compelling reason — that’s usually the one we choose to drill, for example, or do further work.”

If the strategy is an effective one, the proof might be in Tempest’s Meleya Project, which forms part of the broader Yalgoo group of properties.

Located on what used to be Thundelarra Station, roughly 460km north of Perth, early geological survey maps had designated the project as modern sediments overlying barren granite. Initial field work by Tempest in 2019, however, found a number of inconsistencies in that assessment, suggesting instead that the ground was likely a continuation of the Yalgoo Greenstone Belt.

“We had a theory that there were these rocks out there,” Smith says.

“So we went out there and collected soil samples, and when we were out there, the rocks were actually sticking out of the ground. We didn’t even really have to do much to prove it, because there they were. All the old maps showed it was ABC rocks, where in fact it’s actually XYZ rocks, completely different. No one had gone out there to check it.”

From there, Tempest drilled a “deep ass hole” at Meleya’s Orion target in early 2022. Though it didn’t quite have economic grades in it, the hole proved “unequivocally” the presence of mineralisation associated with the Yalgoo Greenstone Belt. 

It also demonstrates Tempest’s commitment to getting work done — the simple practice of doing what you said you’d do — as well as the importance of scientific discernment. Account also for the apparent million-to-one odds on project development, and you can see why Smith is so bent on his carefully curated approach.

“We try to narrow that down substantially by doing good science at the start, so that one in 1000 might become one in 300. A lot of companies drill holes left, right and centre, and good on them, they’re doing great work. But there’s never anything in them.”

“We’re drilling holes and nearly all our holes have stuff in them. Unfortunately, we haven’t got to that next one-in-a-thousand yet. But I think we’re doing pretty good in terms of what we claim we’re going to do versus what we’re getting.”

“In our office, we have a phrase: We don’t do dogma

When Mining.com.au spoke to Tempest Minerals earlier this year, there was a hint of a theme; a whisper of a willingness to stray from generally accepted assumptions about exploration in favour of more perceptive theories.

“In our office, we have a phrase: We don’t do dogma,” Smith said at the time.

“It’s about getting the best outcome. It’s not: This is the way that it has to be.”

It’s a philosophy that’s worked so far, and one which Smith expects to continue working into the future. After all, if fortune favours the bold, it might look kindly upon departures from dogma, too.

Write to Oliver Gray at Mining.com.au

Images: Tempest Minerals
Author Image
Written By Oliver Gray
Originally from Perth, Oliver has a keen interest long-form journalism. He has written for a number of publications and was most recently Contributing Editor of The Market Herald’s opinion section, Art of the Essay.