Title: Managing Exploration Risk

MICHAEL DOGGETT, Queens University, doggett@geol.queeensu.ca
MIKE ETHERIDGE, Tectonex Geoconsultants Pty Ltd., mike.etheridge@tectonex.com.au

Fees: By March 1, 2006. $395 Member, $495 Nonmember, $200 Student

Most comprehensive studies of the performance of greenfields exploration over the last 15-20 years indicate that the value created by discoveries is, at best, approximately equal to exploration expenditure. In other words, greenfields exploration adds no value, and may even be mildly value destructive.  In this workshop we begin by reviewing the data and analysis around this conclusion, followed by discussion of the impact of continued performance at this level on the future of the mining industry.  In particular, we will address with participants the key question - "Is breakeven good enough?".  This will be followed by a session on the fundamentals of risk assessment and management in mineral exploration, and on their implications for decision-making.  We will demonstrate that any assumption that we make consistently rational decisions is unjustified, and that certain biases are an expected outcome of operating in a high-risk, high-uncertainty business.  The final session will examine some strategic and tactical outcomes and solutions, and will help participants to focus on exploration as a business, and on the perspective and needs of the investors in our business.