Clarence Chongo, Lusaka, 01 April 2024
Previously On the Kobold Metals Saga:
IN PART 1 of this series, we reported on a series of announcements concerning an incredible find at Ming’omba in Chililabombwe, Zambia, by Kobold Metals, working in partnership with ZCCM IH Plc.
In Part 2, we posited that prominent, mainstream media in Zambia distorted the news around the KoBold announcement, resulting in a mischaracterisation that left the public lost in translation. We suggested that those media distortions led to a mass outpouring of angst among the Zambian public. We also presented evidence showing that in their own work, KoBold had actually used the very historical, mineral exploration survey results that the people of Zambia bemoaned, quite rightly, as already existing and owned by them, and not KoBold. Then we explained the geological uncertainties that had left Ming’omba in limbo for decades before KoBold came to the rescue.
In This Article
TODAY, FINANCIAL INSIGHT shall grapple with the following matters:
- Okay so, exactly what did KoBold Metals do?
- How did KoBold weaponise AI to lead them to a truly disruptive discovery?
- Exactly what did KoBold discover?
Part 3 (The Finale)
WE START THE finale to the KoBold Mysteries with the conclusion of a story. Remember the great ‘Book of Knowledge and Wisdom?’ Well, here is how that story ends…
– – –
“Activate AI?” inquired the wizened caretaker, his old brow furrowing with lines of puzzlement. “What is this AI? Is that your magic, dear Wizard?”
“My name is Josh, and I am no wizard,” Josh replied. “And no, AI is no magic at all; it is merely ‘Artificial Intelligence.’ Although AI can seem magical in its effects, it is only some clever bits of tech. We can deploy AI to restore the Great Book for this great nation.”
“I see,” said the old caretaker, peering curiously at Josh’s grinning face. “How does this technology work, then?”
“I have an idea,” Josh rejoindered. “Why don’t you come with me, and we do it together? Let’s go to my lab and you can help me restore the Book of Knowledge and Wisdom, using AI.”
“But I do not know anything about AI,” said the old man. “How could I possibly help you?”
“Well, you know something that is far more valuable,” countered Josh. “You know the book.”
– – –
A Global Financial Stranglehold
IN PART 2, we saw how Ming’omba, in the grip of geological uncertainty, lay in limbo for decades. The site was the victim of a throttling chokehold that had rendered it unable to have, presented about it, a compelling case for the commissioning of a commercially viable mining operation. This beggars the question: Wasn’t there anything that anyone could have done? Were no solutions available to resolve the uncertainties, alleviate the situation and save Ming’omba from its paralysis?
The simple answer is yes, there was, actually—and that was to conduct yet more explorations. In other words, Ming’omba needed a lot more of what had already been done before; numerous, additional exploration projects designed to connect the uncertain dots and generate an accurate definition of the structure of the ore as it lies under the earth’s surface. However, as simple as that sounds theoretically, in practical terms, Ming’omba always had an enormous limiting factor looming above it, dwarfing even the geological uncertainties that plagued it.
That factor is ‘exploration finance,’ or more accurately, lack of exploration finance.
It is trite knowledge that the success of any mining expedition begins with the success of its exploration effort. In the absence of viable exploration projects, sustainable mining businesses cannot emerge. If anyone were to ask what the secret to mining success is, ‘It’s the exploration, stupid!’ might be a fitting retort. This is why major mining countries pour millions of dollars into exploration projects.
Take Canada, for example, which, since 2013 has spent an estimated average of circa US$3.1Bn on exploration per annum. Australia, another mining behemoth, isn’t far behind, with almost US$1.7Bn per annum. Ask how much Zambia has spent in the same period; the KoBold investment of US$150m on a single project surpasses the total amount spent on all other explorations put together in the last decade. It’s almost as if Zambia forgot that, when it comes to mining, exploration is your knight in shining armour.
But Zambia has not been alone. Worldwide, there has been a shrinkage in the investment space for mineral exploration for many years. In an illuminating exchange which occurred on the second day of Mining Indaba 2024, Ms. Nastassia Arendse, a news anchor at Mining Indaba TV (#MITV), put this very pertinent point across to the co-founder and President of KoBold Metals, Dr. Josh Goldman.
“There is a lack of investment in mineral exploration,” Ms. Arendse quipped. “Let’s talk about why we’re seeing little activity when it comes to mineral exploration investment.”
“The lack of investment in mineral exploration is a global problem,” Dr. Goldman responded. “There hasn’t been enough investment to generate the pipeline of high-quality projects that’s going to supply the raw materials that we need for a global fleet of electric vehicles and the transition to renewable energy. What we need to see is much higher investment and exploration around the world and the reason that we haven’t seen it is because exploration success rates are too low. More than 99% of projects will fail to become [successful] economic mineral resources. If we can get the exploration success rate up, the capital will flow.”
And thus, we arrive at the crux of the matter, explaining why Ming’omba has remained undeveloped for all these years. To put in succinct terms, it was quite simply lack of money.
Oh My God; They Did What?
Public statements by Dr. Goldman provide an incisive peek into exactly what KoBold did at Ming’omba, starting with the 5 February article in the Financial Times.
“KoBold Metals deploy[ed] artificial intelligence to scrape historical geological archives,” said the FT. “Such archives include[d] old PDFs, and even maps that are hand painted on linen and [KoBold] use[d] algorithms to help decide where to explore further.”
As we proceed to unpack this, let us first LET THAT SINK IN.
As a matter of fact, let TWO THINGS sink in…
The first is that, straight from the horse’s mouth, we have confirmation that KoBold actually utilised old, historical exploration results as the basis for the data that was fed into their AI models. Here, we have KoBold telling everybody, in no uncertain terms, how the historical Zambian asset of past exploration results was the very foundation of the KoBold success story.
The second piece of news that we should let sink in is this: it looks like historically, Zambia has been attempting to make national, economic, mining decisions based on ‘OLD PDFS, AND EVEN MAPS THAT ARE HAND PAINTED ON LINEN’—such was the quality of our data. Based on such quality of data, we have held long-running expectations that investors and political leaders could make high-quality decisions and provide a definitive answer to the yes-or-no question as to whether or not to commission a gargantuan, US$2.0Bn mining project at Ming’omba. Can you now see why Ming’omba has been in the doldrums for decades, and why, without investors like KoBold, this project would have been consigned to the rubbish heap?
In the same interview with Ms. Arendse of MITV, Dr. Goldman offers a further hint of KoBold’s decisive keystroke, describing exactly what they did.
“Innovation and applying AI to mineral exploration is how we get that success rate up,” said Dr. Goldman. “What we’re doing at KoBold is that we are inventing and deploying AI technology to make better exploration decisions. We have a whole suite of now hundreds of different models that our scientists use, and they apply our models to make decisions on exploration projects.”
If you find that ‘inventing and deploying AI technology to make better exploration decisions’ sounds a little vague, you are not alone. However, in the same MITV interview, Dr. Goldman does elucidate further. He explains that KoBold’s AI technologists, working together with geoscientists, used insights from conventional geoscience—a euphemism for traditional mineral exploration surveys—and the best of industry practice, combined with innovations in quantitative methods (i.e., big data analytics to you and me), to pick out insights out of the data; insights that are hard to see with one’s naked eye. They applied this approach to many different data sets together, allowing them to make better predictions and enabling them to understand the uncertainty in the subsurface. Thus, KoBold were able to quantify the geological uncertainly in statistical terms and those measurements allowed them to design new exploration programmes to collect additional data that could most effectively reduce the uncertainty.
“That that’s what exploration is all about,” said Dr. Goldman. “We’re trying to reduce uncertainty in the subsurface to define mineral deposits… And so, we’re using technology to make better exploration decisions, and the success of Ming’omba demonstrates that our approach is working really, really well.”
At Financial Insight, we have applied some imagination to interpreting Dr. Goldman’s descriptions, purely because we are yet to view any schematic outputs of KoBold’s AI model. We think that when KoBold feeds datapoints into the model, each of those datapoints contributes to the construction of a powerful, dynamic and interactive three-dimensional map of the underground and of the orebody. Such a 3D map would provide a pictorial depiction of the size and shape of the ore structure and provide indications of where gaps exist in the data that could be filled by further exploration.
Discovery, What Discovery?
“We’ve spent a year with the largest fleet of drilling rigs in Southern Africa,” Dr. Goldman, again, this time to the Financial Times. “We now know that Ming’omba will be one of the very highest grade, large copper mines when put into production, and it’s very much like Kakula in scale and in grade.”
It is easy to get lost in the semantics and miss the point altogether. If we parse Dr. Goldman’s statement, he is saying Ming’omba is of similar scale to Kakula in the Democratic Republic of Congo. Any mining enthusiast who knows his way around the lay of the land also knows that the Kamoa-Kakula Copper Project in the DR Congo is considered the world’s largest undeveloped, high-grade copper deposit. Stated differently, Ming’omba is on the same scale as the largest known copper deposit in the world.
For context, Kakula produces upwards of 400,000 metric tonnes of copper per annum. By comparison, Zambia’s total national output for 2023 was circa 682,000 metric tonnes. This means the Kakula project alone currently produces the equivalent of more than half (almost 60%) of our total national output. In other words, when Ming’omba comes into operation, KoBold will have the capacity to produce at least 50% of all the copper that the entire country is currently producing, across all the mines combined.
We find this simply staggering.
The discovery at Ming’omba, therefore, was a question of measurement, and of scale. KoBold took Zambia’s old exploration survey results and fed them into an AI modelling system which allowed them to visualise the orebody under the surface and pinpoint where further, confirming exploration drill-shafts could be sank. As more confirming explorations came in, KoBold were able to define the structure of the ore to very high-quality outcomes, almost completely eliminating the geological uncertainties of the Ming’omba site. In doing so, KoBold unearthed the sheer scale of the orebody, and were able to crystalise knowledge that was previously unknown; knowledge that at Ming’omba, Zambia was sitting on a size and quality of ore of such colossal proportions as to be one of the largest, if not the largest in the world. And to put the icing on the cake, KoBold were also able to measure the richness of this ore, with concentrations averaging 3.5% and as high as 6.3% in places—again, a record for the country.
Before KoBold appeared on the scene, who knew that Ming’omba sat atop this gigantic copper orebody, comparable to the largest deposit ever known? Who knew that, potentially, Ming’omba could easily be the largest mining operation ever conceived of in the world? Who knew that the concentrations of copper in that ore was the highest ever experienced?
In the face of such news, the citizens of any other country in the world would have been jumping up and down in pure glee; from the job opportunities, community development and economic effects represented by the potential to be inferred from such a scale of operations. Instead, Zambia’s media had the country complaining and deriding the news.
At Financial Insight, we believe that this was a missed opportunity for Zambian media; the opportunity to inform the public properly of a phenomenal and historical find, based on the very historical exploration surveys the public were agitatedly—and correctly—claiming as their own. This should have been a special occasion for the nation, and a uniting moment. The people of Zambia should have been given cause to celebrate our past exploration efforts, and not to throw them back into KoBold’s face in contemptuous posts and comments. If only those media houses that command enormous national following had done their job and reported properly, fully and correctly, we could have avoided a national outcry. But, on account of their errors, the public were left lost in translation, resulting in national division. This is a damning indictment of the so-called journalists of this country.
When the time comes for the history of these events to be written, two distinct eras shall be defined for our great nation; the pre-KoBold era, and the post-KoBold.
Dear reader, again, let that sink in.
Financial Insight rests.
