Zinc-Lead-Silver

Please note that this page is currently under review.

The last full review of zinc, lead and silver was part of Australia’s Identified Mineral Resources 2013. The purpose of this summary is to provide updated information on these metals including new developments related to production and exploration and new uses of zinc, lead and silver.

Resource figures are current as at 31 December 2018.

Zinc (Zn)

Zinc is the fourth most common metal in use after iron, aluminium and copper. Approximately 50% of zinc production is used to provide a protective coating on, or to galvanise, steel. Galvanised steel is used extensively in the construction and transport industries as sheet steel, steel beams, vehicle panels, chain-link fencing, guard rails and light posts. The widespread use of zinc as a protective coating is due to its resistance to weathering owing to an electrochemical reaction known as galvanic action. Zinc is more reactive than iron or steel and consequently attracts almost all local oxidation. A protective surface layer of oxide and carbonate forms as the zinc corrodes.

Zinc is also used in die-casts (17% of annual consumption), brass (~20% Zn; 17% of annual consumption), rolled zinc (6% of consumption), chemicals (6% of consumption; mostly as zinc oxide) and miscellaneous uses (4% of annual consumption). Other than the silvery sheen on steel produced by galvanization, the most obvious use of zinc is as zinc oxide, which gives sun cream its white coloration.

Zinc metal is produced in Australia at Sun Metals Corporation Pty Ltd’s refinery in Townsville, Queensland and at Nyrstar Australia Pty Ltd’s refinery in Hobart, Tasmania. Processing of zinc concentrates can also produce cadmium, gallium, germanium and indium as by-products, although the latter three elements are not currently recovered in Australia.

A potential major use of zinc in the future is production of zinc-based batteries, which have some advantages (and disadvantages) over lithium-based and other battery types. Advantages, which include low flammability and high energy densities, have led to the development of a number of different types of rechargeable batteries, including zinc-air, zinc-nickel, zinc-silver, zinc-water and zinc-gel batteries. However these are partly offset by the disadvantages, which include difficulties in recharging (zinc-air), high costs (zinc-silver) and lower power output (zinc-gel), among others. Although none of these have been developed to the point of commercial production, zinc potentially could become an important metal for battery technology.

Lead (Pb)

The widespread occurrence of lead, its relatively simple extraction and a combination of desirable properties have made it useful to humans since at least 5000 BC. In deposits mined today, lead, mainly in the form of the mineral galena (PbS), is usually associated with zinc, silver and sometimes copper and is extracted as a co-product alongside these metals.

Historically, lead has been used in pipes, pewter, paint and as an anti-knocking additive for petrol, but these and a few other minor uses have been discontinued owing to the toxicity of lead. The largest present-day use is in batteries for vehicles, which accounts for 80% of current lead usage. The remaining 20% includes underwater cable sheathing, solder, casting alloys, chemical compounds, ammunition, weighting, glassware and radiation protection.

Uses for lead could increase in the future in large storage batteries used for load-levelling of electrical power and in electric vehicles. The growing popularity of electric bikes, particularly in China, has led to the e-bike now consuming more than 8% of world lead production. More than half of the lead currently used is from recycling rather than from mining.

In Australia, lead recycling plants are operated by:

• HydroMet Corporation Pty Ltd (near Melbourne, Victoria and Wollongong, New South Wales);
• Enirgi Power Storage Pty Ltd (Sydney and Wagga Wagga, New South Wales); and
• Nyrstar Australia Pty Ltd at Port Pirie, South Australia. This smelter is one of the world’s largest primary lead smelting facilities and a leading global silver producer.

Silver (Ag)

The relative scarcity, attractive appearance and malleability of silver make it suitable for use in jewellery, ornaments and household silverware. In nature, silver can occur in its native form, and it was one of the first metals mined and used by humans. Its extensive use in coins throughout history has declined over the past 60 years. In Australia, the 1966 50-cent piece was the last coin in circulation to contain silver (80% silver, 20% copper (Cu)).

Silver is mined and produced mainly as a co-product of lead, zinc, copper and, to a lesser extent, gold (Au). Currently, jewellery, photographic paper and film, followed by electronics and tableware, are the most important uses of silver. Other applications include coatings for mirrors, for biocide and bacteriostatic activity in plastic and textiles formulations and as an anti-bacterial agent in areas such as water treatment, including, for example, as an ioniser with copper in domestic swimming pools.

Price Variations

Figure 1 shows price variations in Australian and United States dollars since 2000 for (a) lead, (b) zinc and (c) silver. Although the price trends for zinc and lead are similar, the price trend for silver is quite different.

Both zinc and lead show a broadly increasing price trend since late 2003 with major price peaks at ~AU$5700/t in 2006 for zinc and ~AU$4000/t in 2007 for lead. Subsequent to these peaks, by early 2009 the prices of both metals dropped to ~AU$1600/t and ~AU$1400/t, respectively. Since 2009 the prices of both metals have trended upwards although with a number of troughs along the way, the most recent of which was in August 2018. For August 2019, average zinc and lead prices were ~AU$3810/t and ~AU$3020/t. These prices represent three and fourfold increases, respectively, since the beginning of the upward price trend in late 2003.

In contrast, the price of silver did not have a major peak in 2006-2007. Rather, there was an increasing trend from late 2003 until late 2011 at which time the silver price peaked at ~AU$38/oz. Since late 2012, the silver price decreased and has fluctuated mostly between AU$20/oz and AU$25/oz.

Figure 1. Variations in the quarterly average prices of (a) zinc (per tonne), (b) lead (per tonne), and (c) silver (per Troy ounce) in United States and Australian dollars, based on London Metals Exchange price.

JORC Ore Reserves

As at December 2018, Proved and Probable Ore Reserves of zinc, lead and silver reported in compliance with the JORC Code amounted to 23.94 Mt, 12.37 Mt and 25.40 kt, respectively. This represents a decrease of 4.8% for zinc, and increases of 8.1% and 4.0% for lead and silver, respectively, on 2017 values (Table 1). In addition Ore Reserves accounted for about 36%, 36% and 29% of Australia’s Economic Demonstrated Resources (EDR) for zinc, lead and silver, respectively. Zinc, lead and silver occur in all of Australia's states and the Northern Territory (Figure 2).

Zinc Ore Reserves were relatively constant from 2002 to 2011, but increased significantly in 2012. They declined in 2013 and 2014, and have since remained relatively constant (Figure 3).

Lead Ore Reserves were reasonably constant from 2002 to 2008 but increased from 2009 to 2012. They declined significantly between 2013 and 2014 and have since remained relatively constant (Figure 4).

Silver Ore Reserves peaked in 2012. They decreased in 2014 and 2015 but have been relatively constant since (Figure 5).

Identified Resources

Economic Demonstrated Resources (EDR) of zinc (Table 2), lead (Table 3) and silver (Table 4) were 66.96 Mt, 35.78 Mt and 88.36 kt, respectively, at the end of December 2018. In all cases, the values were lower than the previous year, but this was more than offset by an increase in Inferred Resources for each metal (up 14%, 7% and 7%, respectively).

Figure 2 shows that Queensland has by far the largest EDR for zinc, lead and silver (~60% of each), with significant EDR for zinc and lead in the Northern Territory (~25%). For silver, the Northern Territory, New South Wales and South Australia also had significant EDR (10-15%). All other states had small contributions to the national EDR for zinc, lead and silver.

Figure 2. Distribution of lead, zinc and silver EDR by Australian jurisdiction as at December 2018. Where applicable, the number of mines in each jurisdiction is in brackets.

Accessible EDR

Some mineral resources are inaccessible for mining because of environmental restrictions, government policies or because they occur within military lands or national parks. All of Australia’s EDR of zinc, lead and silver are considered to be accessible.

Production and Reserve Life

Australian production of zinc, lead and silver was 1.112 Mt, 0.469 Mt and 1.220 kt, respectively, and increased for all three metals in 2018 (Table 1). Production levels of both zinc and lead are recovering from lows in 2016-2017 (Figure 3 and Figure 4). The production of silver increased in 2018, reversing a decreasing trend in production since 2014 (Figure 5).

Reserve life, the ratio of Ore Reserves to production, was 22, 26 and 21 years for zinc, lead and silver, respectively (Table 1).

The 2018 reserve life for zinc is significantly lower than that of 2017 and reverses a trend of increasing reserve life since 2015 (Figure 3). This is due mostly to increased production, but also to the small fall in reserves. For lead the reserve life is similar to 2016 and 2017 (Figure 4): changes in production and reserves were small and offsetting. For silver, 2018 reserve life is similar to 2017, and follows a broad trend of increasing reserve life since 2005 (Figure 5). The overall increase in reserve life for all three metals since 2015 is largely due to the decision to decrease production (and increase price) by Glencore at that time.

Figure 3. Trends in (a) zinc reserve and resource life. These ratios are derived from (b) Ore Reserves, Economic Demonstrated Resources (EDR), all resources (EDR + Subeconomic Demonstrated Resources + Inferred Resources) and annual production, 1975-2018.

Figure 4. Trends in (a) lead reserve and resource life. These ratios are derived from (b) Ore Reserves, Economic Demonstrated Resources (EDR), all resources (EDR + Subeconomic Demonstrated Resources + Inferred Resources) and annual production, 1975-2018.

Figure 5. Trends in (a) silver reserve and resource life. These ratios are derived from (b) Ore Reserves, Economic Demonstrated Resources (EDR), all resources (EDR + Subeconomic Demonstrated Resources + Inferred Resources) and annual production, 1975-2018.

Table 5 summarises reserve life and resource life at operating mines. Reserve life for operating mines is significantly lower as undeveloped Ore Reserves are not included. However, as Ore Reserves are determined to provide confidence for short to medium term development, they generally understate the likely production life of a particular mine.

Table 5 also estimates the resource life for operating mines using Measured plus Indicated Resources (inclusive of Ore Reserves) and all resources (i.e. also including Inferred Resources). Estimates of resource lives are significantly longer than those of reserve lives and are probably a better indication of Australia’s overall remaining metal resources.

This is best illustrated by looking at cumulative production against past Ore Reserve estimates. Production of zinc since 2002 (22.9 Mt) accounts for 96% of the Ore Reserves delineated that year (23.8 Mt). Similarly, the cumulative production of lead since 2002 (10.8 Mt) is equal to 103% of the 2002 Ore Reserve (10.4 Mt) and the cumulative production of silver since 2002 (29.8 kt) is also 103% of the Ore Reserve estimated that year (28.9 kt). Conversion of resources to reserves and near-mine discovery of additional resources will likely continue to extend reserve lives into the future, as will short term shut-downs or production decreases at existing mines or the development of new mines.It is important to stress that the reserve and resource lives discussed here apply to Australia as a whole. The length of production at individual mines is dependent upon the amount of remaining resources and the discovery of additional near-mine resources. Moreover, mine life can be extended or renewed through the development of new technologies, including mine waste retreatment, as has been demonstrated by the reopening of the Century and Woodlawn mines to retreat tailings recently (see Industry Developments below).

Overall reserve and resource lives for Australia may also increase as new mines are developed and become producers, either replacing existing production as old mines close or introducing new production. This is illustrated by Table 6, which compares reserve and resource lives for only operating mines with those for all reserve and resources, which includes undeveloped deposits. As an example, when all deposits of zinc are considered, the life of all resources, at 100 years, is far longer than the reserve life at operating mines (20 years) or even all resources at operating mines (55 years). The all resources life for all deposits is larger than the reserve life of operating mines by a factor of nearly six. Similar relationships also apply to lead and silver (Table 6).

World Ranking

Based on data provided by the United States Geological Survey¹, supplemented by the data presented above, Australia ranks highly both in terms of production and economic resources (Table 7 and Table 8). For zinc, Australia ranked first for economic resources and third for production in 2018. For lead Australia ranked first for economic resources and second for production and for silver, Australia ranked third for economic resources and sixth for production.

Industry Developments

Figure 6 shows changes in spending on zinc, lead and silver exploration from 2000 until 2018. The trend in exploration spend closely tracks the price fluctuations of zinc and lead, with the major peak in exploration spend coinciding with the 2006 and 2007 price spikes for zinc and lead, respectively. There was a second, more subdued peak in 2011 and 2012 with spend approximately 1.6 times the base level spend of about $50 million in constant 2018 dollars.

Exploration spend has increased over the last two years since the last trough in spending from 2014 to 2016 to a level about twice the constant-dollar base level spend. The peak in zinc-lead-silver exploration spend in 2007 corresponds to the overall peak in exploration spend just prior to Global Financial Crisis. Interestingly, the discovery and drill-out of the Teena deposit (see below) corresponded in time to the slow-down and trough in zinc-lead-silver exploration spend between 2013 and 2016.

Figure 6. Changes in exploration spending on zinc, lead and silver from 2000 until 2018 in nominal and real (2018) Australian dollars.

Between 2012 and 2016, five major global zinc deposits, including the Century and Black Star (Mount Isa) deposits in Queensland, closed. In 2015, Glencore Pty Ltd decreased its global zinc production by a third, partly from deposits in northern Australia. The closures and decreased zinc (and lead) production initially resulted in increasing zinc and lead prices until mid-2018.

Exploration for zinc, lead and silver deposits in Australia since 2012 has been geographically targeted, with much of the exploration concentrated in the Carpentaria Zinc Belt in northwest Queensland and northeastern Northern Territory. Other areas that have produced significant results include other parts of the Northern Territory, western and central New South Wales and northeastern Queensland.

Figure 7 shows the location of zinc-lead-silver and Figure 8 shows the silver-only deposits in Australia for which resource data are available. They also shows the location of projects described below.

Figure 7. Australian lead-zinc deposits and operating mines as at 31 December 2018. Resource size is based on total resources (Measured + Indicated + Inferred, inclusive of Ore Reserves).

Figure 8. Major Australian silver deposits and operating mines as at 31 December 2018. Many other deposits, particularly gold deposits, also produce minor silver by-product. These mines are not shown here. Resource size is based on total resources (Measured + Indicated + Inferred, inclusive of Ore Reserves).

Citation

Bibliographical reference: Huston, D., 2020. Australian Resource Reviews: Zinc, Lead and Silver 2019. Geoscience Australia, Canberra.

References