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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Scotgold Resources Limited | LSE:SGZ | London | Ordinary Share | AU000XINEAK5 | ORD NPV (DI) |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 13.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
TIDMSGZ
RNS Number : 1668O
Scotgold Resources Ltd
25 May 2015
SCOTGOLD RESOURCES LIMITED
CONONISH GOLD PROJECT STUDY UPDATE
AND JORC 2012 ORE RESERVE ESTIMATE
Scotgold Resources Limited ('Scotgold' or 'the Company') is pleased to announce a new Ore Reserve estimate for its wholly owned Cononish Gold Project and provide an update on development activities. The Ore Reserve estimate, compiled by Bara Consulting Ltd, has been classified and is reported as Proven and Probable, based on guidelines recommended in the JORC Code (2012). The Cononish Gold Project is part of the Company's gold portfolio located in Scotland.
HIGHLIGHTS(1)
-- Total Ore Reserve estimate increased by 179% to 198,000 ounces of gold(Au) and 851,000 ounces of silver (Ag) (555,000 tonnes at 11.1g/t Au and 47.7g/t Ag respectively);
-- The maiden Proven Reserve of 24,000 ounces Au and 108,000 ounces Ag (65,000 tonnes at 11.5g/t Au and 51.5g/t Ag for respectively);
-- The mining methodology trade off study has been completed and Long Hole Open Stoping (LHOS) is confirmed as most appropriate;
-- The life of mine increases to approximately 8 years at a processing rate of 72,000tpa;
-- The new mine design and mine schedule has also been completed, enabling earlier access to higher grade ore and gold equivalent production of approximately 30,000 ounces per annum in years 2 and 3;
-- The average annual gold equivalent production increased to approx. 23,000 ounces per annum.
-- The exploration team has been enhanced with the recruitment of a Project Geologist and a structural prospectivity exercise has been commenced.
Note1: All comparisons relate to Cononish Development Plan released 30/04/2013 and available at www.scotgoldresources.com.
STUDY UPDATE
A thorough review has been undertaken of the 2013 Cononish Development Plan developed by AMC Consultants (UK) Ltd (AMC) in order to identify opportunities to not only improve on the plan but to also improve the confidence in the plan. As a result of this review further work has been undertaken on the mining methodology, access design, geotechnical evaluation and overall mine design.
The outcome of this work is a revised Development Plan developed by Bara Consulting (Bara). This revised Development Plan is complete in all areas to at least a Prefeasibility Study level and consequently the Company is now able to estimate the Ore Reserve based on the Mineral Resource Estimate (MRE) issued in January 2015. Greater detail on the parameters derived from this work and used for the Ore Reserve estimation process is given in the following sections of this release.
Further work is still required to complete the Bankable Feasibility Study (BFS), principally to update the capital cost estimates, review and adjust as appropriate the operating cost estimates and incorporate the conceptual opportunities identified for savings. This is expected to be completed by the end of July 2015.
The Company has also recruited a Project Geologist to the team who has previously conducted various studies on gold mineralisation in the Dalradian belt. This additional capacity, together with a structural prospectivity study already commenced, will focus our ongoing exploration programs designed to both further build on the mineral resources at Cononish and throughout our extensive Grampian Project.
ORE RESERVE ESTIMATE
As at 25 May 2015 (JORC 2012 Code) -------------------------------------------- Classification Proven Probable Total ---------------- ------- --------- ------ Tonnes ('000) 65 490 555 ---------------- ------- --------- ------ Au Grade (g/t) 11.5 11.1 11.1 ---------------- ------- --------- ------ Au Metal (k oz) 24 174 198 ---------------- ------- --------- ------ Ag Grade (g/t) 51.5 47.2 47.7 ---------------- ------- --------- ------ Ag Metal (k oz) 108 743 851 ---------------- ------- --------- ------ (Bara Consulting Limited Ore Reserve Statement dated May 2015) -------------------------------------------- As at 30 April 2013 (JORC 2004 Code) -------------------------------------------- Classification Proven Probable Total ---------------- ------- --------- ------ Tonnes ('000) 0 200 200 ---------------- ------- --------- ------ Au Grade (g/t) 0 11 11 ---------------- ------- --------- ------ Au Metal (k oz) 0 71 71 ---------------- ------- --------- ------ Ag Grade (g/t) 0 45 45 ---------------- ------- --------- ------ Ag Metal (k oz) 0 289 289 ---------------- ------- --------- ------ (Development Plan dated 30 April 2013) -------------------------------------------- Variance - Increase / (Decrease) 2013 to 2015 -------------------------------------------- Classification Proven Probable Total ---------------- ------- --------- ------ Tonnes ('000) n/a 145% 177% ---------------- ------- --------- ------ Au Grade (g/t) n/a 1% 1% ---------------- ------- --------- ------ Au Metal (k oz) n/a 145% 179% ---------------- ------- --------- ------
Note: the Ore Reserve estimates reported Development Plan dated 30/04/2013 under the JORC 2004 code are no longer applicable (as discussed in the 2014 Annual Report) but are presented here for comparative purposes only.
The most significant factor underlying the increase in the 2015 Ore Reserve estimate is the Mineral Resource Estimate (MRE) published in January 2015. The increased confidence in this MRE and the consequent increase in material classified as Indicated, together with the work done to verify the modifying factors, has resulted in the estimation of both Proven and Probable categories of Ore Reserve. It should also be noted that the gold price used for the Ore Reserve estimation is now US$1,100/ounce (compared with US$1,300/ounce Au in the 2013) and the silver price used is US$15/ounce.
Commenting on the improved numbers and the estimation of a maiden Proven Ore Reserve, Scotgold CEO, Richard Gray said "We continue on track to deliver the Cononish Project into production. I believe this Ore Reserve statement highlights the robustness of the project, even using a gold price of US$1,100/ounce, some US$100 below the current market price. This improved confidence is a material factor in our early stage discussions with potential financiers and will assist us secure the best possible financial arrangements in the coming months"
For further information:
Scotgold Resources Limited Westhouse Securities Limited
Richard Gray
Chief Executive Officer Martin Davison Tel: +44 (0)7905 884 021 Tel: +44 (0)20 7601 6100 Capital Markets Consultants Vicarage Capital Limited Simon Rothschild Rupert Williams Tel +44 (0)7703 167 065 Tel: +44 (0)20 3651 2911
SUMMARY OF MATERIAL INFORMATION FROM REVISED DEVELOPMENT PLAN
1 RESOURCES CONSIDERED FOR MINING
The JORC 2012 compliant Mineral Resource Estimate is shown in Table 1.1 below and was compiled by CSA Global (UK) Limited. Details of the supporting work, including Section 1, 2 and 3 of the JORC 2012 Code table 1 checklist were given in the Company's announcement dated 12 January 2015.
Table 1.1 - Mineral Resource Estimate
Table 1.1 - Mineral Resource Estimate as at 12 January 2015 Reported at a cut off grade of 3.5g/t gold ----------------------------------------------------------------------------------------------------------------- Classification K tonnes Grade Au Metal Au Grade Ag Metal Ag Bulk Density g/t Koz g/t Koz ------------------------------- ----------- ----------- ----------- ----------- ----------- --------------- Measured - In-situ 60 15.0 29 71.5 139 2.72 ------------------------------- ----------- ----------- ----------- ----------- ----------- --------------- Indicated - In-situ 474 14.3 217 58.7 895 2.72 ------------------------------- ----------- ----------- ----------- ----------- ----------- --------------- Indicated - Mined Stockpile 7 7.9 2 39.0 9 2.72 ------------------------------- ----------- ----------- ----------- ----------- ----------- --------------- Sub-total M & I 541 14.3 248 59.9 1,043 2.72 ------------------------------- ----------- ----------- ----------- ----------- ----------- --------------- Inferred - In-situ 75 7.4 18 21.9 53 2.72 ------------------------------- ----------- ----------- ----------- ----------- ----------- --------------- Total MRE 617 13.4 266 55.3 1,096 2.72 ------------------------------- ----------- ----------- ----------- ----------- ----------- --------------- Reported from 3D block model with grades estimated by Ordinary Kriging with 15 m SMU Local Uniform Conditioning adjustment. Minimum vein width is 1.2m. Totals may not appear to add up due to appropriate rounding. ----------------------------------------------------------------------------------------------------------------- (CSA Global (UK) Limited Mineral Resource Estimate as at 12 January 2015) 2 cut-off grade and modifying factors 2.1 Cut-off Grade
In order to simplify the calculations based on grade, the value of silver and gold were combined by the calculation of an equivalent gold value. The calculation considered the different metal process and recoveries. The equation used for calculating equivalent Au g/t is:
Equivalent Au (g/t) = Au g/t + (Ag g/t *0.015)
A breakeven grade was calculated based on the operating costs for mining and processing as well as the prevailing metal prices.
Based on this calculation a mining cut-off of 4.6 g/t Equivalent Au (RoM) was applied in the mine plan. Only stopes with in-situ grades above the cut-off were targeted in the plan. In limited cases it is necessary to mine lower grade blocks in order to access the targeted blocks, rather than re-developing around the lower grade blocks, and so some lower grade stope blocks are included in the plan.
A marginal pay limit was calculated in the same manner, but by setting the mining cost to zero, to determine the cut-off grade for development ore. The marginal cut-off grade is 2.3 g/t Equivalent Au in-situ, which equates to 2.1 g/t Equivalent Au RoM grade. To ensure at least some profit margin on marginal ore the cut-off grade applied in determining which development ore to process was set at 2.5 g/t equivalent Au RoM grade.
2.2 Dilution
Considerable effort went into estimating dilution. All the current ore intersections on the 400 m Level Adit were mapped and detailed stope configurations were overlaid onto the mapping and sampling data. Eleven different cases were analysed to determine the amount of both planned dilution and unplanned dilution that was likely to occur during mining. Planned dilution is that waste or unpay material that is included in the stope envelope. This is normally due to the variation in vein thickness/grade or deviation of the vein away from the straight lines of the stope envelope.
Unplanned dilution is an allowance made for inaccuracies and error in the mining process, which may occur due to inaccurate drilling, deviation of the drill hole, blast damage or failure of the stope hanging or sidewall.
The estimate of the predicted dilution and the width of the vein in each of the eleven cases were plotted against each other and a regression curve determined. The best fit for the data set was a power function, where:
Total dilution (%) = 0.792 X Width (m)(-1.638)
This formula was used to allocate dilution to each stope block in the mine plan. The average stope dilution is 30%.
An additional source of dilution in the mine plan is development. Ore development was categorised into grade categories in the mine plan:
ü Pay - RoM grade (Eq Au g/t) > 4.6 g/t
ü Low grade - RoM grade (Eq Au g/t) < 4.6 g/t and >2.5 g/t
ü Unpay - RoM grade (Eq Au g/t) < 2.5 g/t
Both pay and low grade development ore will be processed and therefore have been included in the Mineral Reserve estimate. The unpay development ore will be treated as waste material.
2.3 Ore Loss
An allowance was made for ore loss to account for:
ü Broken ore not recovered from stopes
ü Ore not broken due to inaccurate mining or mining complications such as stope bridging
ü Ore lost during the mucking and hauling process, between the stope and the RoM pad.
Based on experience from other narrow vein gold operations ore loss was set at 10%.
3 ore reserve statement
The geological block and structural models produced by CSA were used to develop the mine design. The level intervals proposed by AMC were considered appropriate as was the long hole open stoping mining method. The mine design included a rock pass system (which was not included in the AMC design) and a revised layout for the ramp systems. The rock pass system introduced considerable more flexibility and will lead to reduced operating costs by reducing truck haul distances. Appropriate pillars where built into the mine design. These were based on a detailed geotechnical investigation completed in April 2015. No Inferred Mineral Resources where included in the mine design.
An illustration showing a vertical projection of the ore body looking north coloured by grade can be found on the Company's website at www.scotgoldresources.com a further illustration showing a vertical projection looking north but coloured by year can also be found at www.scotgoldresources.com.
In order to confirm the economic viability, the 2015 schedule was evaluated with the 2013 estimated operating costs and capital costs, which were updated to reflect the revised layout and schedule. No further revision to costs (quoted below) were made, as after review as part of the BFS, they are considered prudent and appropriate at a Prefeasibility Study level of +/-20%.
The operating costs used in the life of mine financial model are shown in Table 3.1.
Table 3--1 - Prefeasibility Operating Cost Estimate (LoM Averages) ------------------------------- Operating Cost GBP/RoM tonne -------------------- --------- Mining 48.40 -------------------- --------- Processing 31.06 -------------------- --------- Administration 8.51 -------------------- --------- Total 87.97 -------------------- ---------
The processing and administration costs have changed slightly due to the longer life.
The capital costs used in the life of mine financial model are shown in Table 3.2.
Table 3--2 - Prefeasibility Capital Cost Estimate ---------------------------------------- Capital Cost GBP millions ------------------------- ------------- Mine Development 3.648 ------------------------- ------------- Mining Equipment 2.734 ------------------------- ------------- Processing Plant 10.728 ------------------------- ------------- Tailings Facility 4.112 ------------------------- ------------- Infrastructure 0.996 ------------------------- ------------- Environmental and Social 1.174 ------------------------- ------------- Labour (pre-production) 0.375 ------------------------- ------------- Total 23.767 ------------------------- -------------
Development costs have increased due to the revised mine design. Labour costs have increased due to an increased allowance for pre-production expenditure. Development capital includes all waste development until the end of the mine life.
The metal prices used in calculating cash flow for this economic assessment were US$ 1,100/Au oz and US$ 15/Ag oz and an exchange rate of US$/GBP 1.60 was applied. These prices were provided by Scotgold and are considered appropriate.
The estimate showed that the planned operation returns a positive cash flow, with a pre-tax NPV of GBP21.3 million at a discount rate of 10 per cent and a pre-tax IRR of 45%. This confirms that the operation is economically viable.
Bara has been commissioned by Scotgold to update the areas of work in the AMC Development Plan, which are considered to be at PFS levels, and produce a BFS. This is expected to be completed by the end of July 2015. The BFS is well advanced and early indications are that these numbers may be improved once opportunities already identified to reduce costs have been incorporated into the study.
Table 3.3 shows the resource estimate and the conversion of the Mineral Resource to Ore Reserve.
Table 3--3 - Summary of Mineral Resource to Ore Reserve Conversion ----------------------------------------------------------------------------- Item Factor Tonnes Au Au Ag Ag '000 Grade '000 Grade '000 g/t Oz g/t Oz ------------------------- ------- ------- ------- ------ ------- ------ Resource (Measured and indicated at 3.5 g/t cut-off) 541 14.3 249 59.9 1,042 ------------------------- ------- ------- ------- ------ ------- ------ Less unpay areas (after mining cut-off ) 5 g/t 374 15.7 189 69.1 830 ------------------------- ------- ------- ------- ------ ------- ------ Dilution ------------------------- ------- ------- ------- ------ ------- ------ Stoping 30% 99 0.9 3 4.7 15 ------------------------- ------- ------- ------- ------ ------- ------ Low Grade Development 136 6.2 27 20.9 91 ------------------------- ------- ------- ------- ------ ------- ------ With dilution 609 11.2 218 47.8 936 ------------------------- ------- ------- ------- ------ ------- ------ Less Ore loss (10%) 10% -61 11.2 -22 47.8 -94 ------------------------- ------- ------- ------- ------ ------- ------ From Underground Mine 548 11.2 197 47.8 843 ------------------------- ------- ------- ------- ------ ------- ------ From surface stockpile 7 7.9 2 39.0 9 ------------------------- ------- ------- ------- ------ ------- ------ Total Mineral Reserve 555 11.1 198 47.7 851 ------------------------- ------- ------- ------- ------ ------- ------
The Ore Reserve statement is shown in Table 3.4. This is an estimate of the ore to be delivered to the plant.
Table 3.4 - Ore Reserve Statement ---------------------------------------------------------------------------- Classification Tonnes Grade Au Grade Ag '000 Au g/t '000 oz Ag g/t '000 oz ------------------- --------- --------- ---------- --------- ---------- Proven 65 11.5 24 51.5 108 ------------------- --------- --------- ---------- --------- ---------- Probable 490 11.1 174 47.2 743 ------------------- --------- --------- ---------- --------- ---------- Total 555 11.1 198 47.7 851 ------------------- --------- --------- ---------- --------- ---------- (Bara Consulting Limited - Ore Reserve Statement dated May 2015)
The Mineral Resources are declared inclusive of Ore Reserves.
Competent Persons Statement
The information in this report that relates to the 2015 Ore Reserves for Cononish Gold Project and the revised development plan is based on information compiled by Pat Willis, a Competent Person who is registered as a Professional Engineer (Pr.Eng.) with the Engineering Council for South Africa (ECSA) and a Fellow in good standing and Past President of the Southern Africa Institute of Mining and Metallurgy (FSAIMM).. Mr Willis is employed by Bara Consulting Limited, an independent consulting company. Mr Willis has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Willis consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
The information in this report that relates to the 2015 Mineral Resources Estimate for Cononish Gold Project (refer ASX announcement dated 22/01/2015) is based on information compiled by Malcolm Titley, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Titley is employed by CSA Global (UK) Limited, an independent consulting company. Mr Titley has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Titley consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
Further, the Company confirms it is not aware of any new information or data that materially affects the information contained in the original announcement and that all material assumptions and technical parameters underpinning the estimate of Resources continue to apply and have not materially changed
The information in this report that relates to the Cononish Development Study Results (refer ASX announcement dated 30/4/2013) was compiled by Mr. Martin W Staples BSc, FAusIMM., Director and Principal Mining Engineer with AMC Consultants (UK) Ltd based in the Maidenhead, UK office (now relocated to Perth W.A). Mr. Staples has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which he is undertaking to qualify as Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr. Staples consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. This information was prepared and first disclosed under the JORC Code 2004
Forward Looking Statement
Statements regarding plans with respect to the Company's mineral properties are forward-looking statements. There can be no assurance that the Company's plans for development of its mineral properties will proceed as currently expected. There can also be no assurance that the Company will be able to confirm the presence of additional mineral deposits, that any mineralisation will prove to be economic or that a mine will successfully be developed on any of the Company's mineral properties.
Appendix A: JORC Code, 2012 Edition - Table 1 report
Appendix B: Glossary of technical terms
Term Description ---------------- ------------------------------------------------ % Percent ---------------- ------------------------------------------------ degC Celsius degrees ---------------- ------------------------------------------------ 3D Three-dimensional model or data ---------------- ------------------------------------------------ AAS Atomic Adsorption Spectronomy ---------------- ------------------------------------------------ Acid test A method of orientating a drillhole using an acid etch ---------------- ------------------------------------------------ Adit Underground mining tunnel, for mining, drainage, access ---------------- ------------------------------------------------ Ag Silver, atomic number: 47. Measured in parts per million (grams per tonnes) ---------------- ------------------------------------------------ AQ Diamond Drill core Diameter: 27mm inside barrel ---------------- ------------------------------------------------ Aqua regia Partial acid digestion method, dissolving base and precious metals but not silicates and/or alumina's ---------------- ------------------------------------------------ Assay A general term for geochemical analysis of a sample ---------------- ------------------------------------------------ Au Gold, atomic number: 79. Measured in parts per million (grams per tonnes) ---------------- ------------------------------------------------ Auriferous Enriched in gold ---------------- ------------------------------------------------ Azimuth An angular measurement in a spherical coordinate system, i.e. deviation degree relative to north ---------------- ------------------------------------------------ Blanks A reference material/sample which contains zero grade, inserted to determine sampling or laboratory contamination ---------------- ------------------------------------------------ BQ Diamond Drill core Diameter: 36.5mm inside barrel ---------------- ------------------------------------------------ Breccia A rock that has experienced significant brittle deformation, and is composed of broken fragments typically cemented together by a fine-grained matrix ---------------- ------------------------------------------------ Bulk density The mass of many particles of the material divided by the total volume they occupy. The total volume includes particle volume, inter-particle void volume, and internal pore volume ---------------- ------------------------------------------------ Calcareous Enriched in calcium, typically calcium carbonate ---------------- ------------------------------------------------ CAPEX Capital Costs (short for Capital Expenditure). ---------------- ------------------------------------------------ Carbonate A carbonate is a salt of carbonic acid, characterised by the presence of the carbonate ion, CO(3) (2-) ---------------- ------------------------------------------------ Chalcopyrite One of the chief ores of copper. Sulphide mineral, composition CuFeS(2) ---------------- ------------------------------------------------ Channel A hard rock sample, typically taken sample perpendicular to the mineralised orientation, continuously over a set length ---------------- ------------------------------------------------ Chip-channel A hard rock composite sample, typically collected using a hammer to obtain numerous fragments of rock ---------------- ------------------------------------------------ cm centimetre ---------------- ------------------------------------------------ Collar Geographical coordinates of the collar of a drill hole or a working portal ---------------- ------------------------------------------------ Compositing The process of dividing or adding sample intervals together to form a regular length ---------------- ------------------------------------------------ CP Competent Person ---------------- ------------------------------------------------ CRM Certified Reference Materials, a QAQC standard sample ---------------- ------------------------------------------------ CSA CSA Global (UK) Ltd ---------------- ------------------------------------------------ Cut-off The threshold value in exploration grade and geological resources estimation above which mineralised material is selectively processed or estimated ---------------- ------------------------------------------------ Datamine A 3D mining software package ---------------- ------------------------------------------------ DD Diamond core drilling method ---------------- ------------------------------------------------ DGPS Differential Global Position System ---------------- ------------------------------------------------ Diamond Method of drilling, using a diamond drill hole impregnated core-bit which produces a solid cylinder of rock core ---------------- ------------------------------------------------ Diamond Circular hand-saw, with a diamond impregnated saw cutting disk, typically used to collect channel samples from hard rock outcrop ---------------- ------------------------------------------------ Dilution The inclusion of waste or low grade (uneconomic) material either during estimation or mining ---------------- ------------------------------------------------ DIP The angle of drilling (or of a structure) relative to horizontal ---------------- ------------------------------------------------ DTM Digital Terrain Model. Three-dimensional wireframe surface model, for example, topography ---------------- ------------------------------------------------ Duplicates A QAQC sample that duplicates a previously collected sampling, employing the same collection and analysis methods ---------------- ------------------------------------------------ Dyke An intrusive, microcrystalline rock, concentrated along a linear feature, typically mafic (enriched in iron and magnesium) ---------------- ------------------------------------------------ Easting Coordinate axis (X) for metre based Projection, typically UTM. Refers specifically to metres east of a reference point (0,0) ---------------- ------------------------------------------------ Electrum A variety of gold containing minor silver (usually 20% weight of silver) ---------------- ------------------------------------------------ Elevation Distance above a datum, typically above sea level ---------------- ------------------------------------------------ Ezy mark A down-hole tool which marks the base of piece of core, while still in the core-barrel (down-hole), the marks are used to orientate drill core ---------------- ------------------------------------------------ Face sample A chip or channel sample collected from an advancing underground mine drive ---------------- ------------------------------------------------ Fault A planar fracture or discontinuity in a volume of rock, across which significant displacement has occurred ---------------- ------------------------------------------------ Fire assay A laboratory method to analyse the total precious metal (Au, Ag, PGE) content of a sample, by fusion, furnace and cupellation followed by Spectrometry analysis ---------------- ------------------------------------------------ Flotation A metallurgical process, typically used for non-acid soluble ore (e.g. sulphides) to concentrate pulverised ore minerals using flocculants ---------------- ------------------------------------------------ Feasibility A comprehensive study of a deposit study in which all geological, engineering, operating, economic and other relevant factors are considered in sufficient detail that it could reasonably serve as the basis for a final decision by a financial institution to finance the development of the deposit for mineral production. ---------------- ------------------------------------------------ Footwall The volume of rock which lies below a structural contact ---------------- ------------------------------------------------ g Gram ---------------- ------------------------------------------------ g/t Grams per tonne (equal to parts per million) ---------------- ------------------------------------------------ Galena One of the chief ores of lead. A sulphide mineral, composition PbS ---------------- ------------------------------------------------ Geochemical In exploration, the main method of sampling sampling for determination of presence of mineralisation. A geochemical sample usually unites fragments of rock chipped with a hammer from drill hole core at a specific interval ---------------- ------------------------------------------------ Geological A domain of rock that has a similar domain character, age, mineralisation style etc. ---------------- ------------------------------------------------ GPS Global Positioning System ---------------- ------------------------------------------------ Gravity A metallurgical process, used to concentrate concentration dense minerals, typically employing a centrifuge or gravity tables ---------------- ------------------------------------------------ Hangingwall The volume of rock which lies above a structural contact ---------------- ------------------------------------------------ Histogram Diagrammatic representation of data distribution by calculating frequency of occurrence ---------------- ------------------------------------------------ HQ A diamond drill core diameter of 96 mm (outside of bit) and 63.5 mm (inside of bit) ---------------- ------------------------------------------------ ICP Inductively Coupled Plasma analysis, used to analysis elemental concentrations of metals and several non-metals ---------------- ------------------------------------------------ IDS Inverse Distance Squared ---------------- ------------------------------------------------ Implicit A method of creating digital surfaces, modelling wireframes and models using automated processes and geological constraints ---------------- ------------------------------------------------ Indicated That part of a Mineral Resource for Resource which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed ---------------- ------------------------------------------------ Inferred That part of a Mineral Resource for Resource which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability ---------------- ------------------------------------------------ Isatis Geovariances' geostatistical software ---------------- ------------------------------------------------ JORC Joint Ore Reserves Committee ---------------- ------------------------------------------------ K Potassium ---------------- ------------------------------------------------ Kg kilogram ---------------- ------------------------------------------------ km kilometre ---------------- ------------------------------------------------ km(2) Square kilometre ---------------- ------------------------------------------------ Kriging Method of interpolating grade using variogram parameters associated with the samples' spatial distribution. Kriging estimates grades in untested areas (blocks) such that the variogram parameters are used for optimum weighting of known grades. Kriging weights known grades such that variation of the estimation is minimised, and the standard deviation is equal to zero (based on the model) ---------------- ------------------------------------------------ LHOS Long hole Open Stoping method of underground mining ---------------- ------------------------------------------------ Lithology Rock type: based on standard international geological classifications ---------------- ------------------------------------------------ Lode Another term for a mineralised vein ---------------- ------------------------------------------------ LUC Localised uniform conditioning, a non-linear "recoverable resource" estimation technique ---------------- ------------------------------------------------ m metre ---------------- ------------------------------------------------ M Million ---------------- ------------------------------------------------ Ma Million years ---------------- ------------------------------------------------ Mean Arithmetic mean ---------------- ------------------------------------------------ Measured that part of a Mineral Resource for Resource which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a high level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are appropriately spaced to confirm geological and/or grade continuity to a high confidence ---------------- ------------------------------------------------ Median Sample occupying the middle position in a database ---------------- ------------------------------------------------ Metamorphosed Undergone physical and/or chemical change due to heat and pressure, through geological processes ---------------- ------------------------------------------------ MICROMINE A 3D mining software package ---------------- ------------------------------------------------ Microns A micrometre - a measurement of length - 1 x 10(-6) metres ---------------- ------------------------------------------------ Mineralised Enriched in concentrations of an element (e.g.) to a degree where it is economically significant ---------------- ------------------------------------------------ Mineral A concentration or occurrence of material Resource of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories ---------------- ------------------------------------------------ Minimum A minimum width, dictated by the mining mining width method employed (open-stope, raise-bore) to which mining can realistically be achieved ---------------- ------------------------------------------------ mm millimetre ---------------- ------------------------------------------------ MRE Mineral Resource Estimate ---------------- ------------------------------------------------ Mt million tonnes ---------------- ------------------------------------------------ Mtpa Million tonnes per annum ---------------- ------------------------------------------------ Native Metal A native metal is any metal that is found in its metallic form, either pure or as an alloy, in nature ---------------- ------------------------------------------------ NN Nearest Neighbour, a method of assigning grades to blocks based on samples that are nearest to it ---------------- ------------------------------------------------ Northing Coordinate axis (Y) for metre based Projection, typically UTM. Refers specifically to metres north of a reference point (0,0) ---------------- ------------------------------------------------ NQ A diamond drill core diameter of 75.7 mm (outside of bit) and 47.6 mm (inside of bit) ---------------- ------------------------------------------------ Nugget The typical difference (for an individual domain) in grade between samples taken immediately adjacent to each other ---------------- ------------------------------------------------ OK Ordinary Kriging. A linear estimation technique using weights determined through variography ---------------- ------------------------------------------------ OPEX Operating Costs ---------------- ------------------------------------------------ Orogenic Geological term for the process of mountain building ---------------- ------------------------------------------------ OSGB Ordnance Survey of Great Britain ---------------- ------------------------------------------------ Outcrop Exposed rock, i.e. not covered by soil or scree ---------------- ------------------------------------------------ Outliers A statistical term. Outliers are defined as data points that do not fit into the distribution of the overall dataset ---------------- ------------------------------------------------ oz. Troy ounce (31.1034768 grams) ---------------- ------------------------------------------------ Palaeozoic Geological Era - from 542Ma to 251Ma ---------------- ------------------------------------------------ Panel chip Chip sampling using a regular grid ---------------- ------------------------------------------------ Pb Lead, atomic number 82 ---------------- ------------------------------------------------ Pegmatite A holocrystalline intrusive rock, dominated by quartz, feldspar, mica and associated with granitic intrusion and high grade metamorphism ---------------- ------------------------------------------------ Pelite Metamorphic rock; of fine-grained sedimentary protolith ---------------- ------------------------------------------------ Percentile A measure used in statistics indicating the value below which a given percentage of observations in a group of observations fall ---------------- ------------------------------------------------ Phanerozoic Geological Eon - from 542Ma to the present day ---------------- ------------------------------------------------ PLC Public Listed Company ---------------- ------------------------------------------------ Population In geostatistics, a population formed from grades having identical or similar geostatistical characteristics. Ideally, one given population is characterized by a linear distribution ---------------- ------------------------------------------------ Porphyry An igneous rock consisting of large-grained crystals in a fine-grained matrix ---------------- ------------------------------------------------ Pre-feasibility A comprehensive study of the viability study (PFS) of a mineral project that has advanced to a stage where the mining method, in the case of underground mining, or the pit configuration, in the case of an open pit, has been established, and which, if an effective method of mineral processing has been determined, includes a financial analysis based on reasonable assumptions of technical, engineering, operating and economic factors and the evaluation of other relevant factors which are sufficient for a qualified person, acting reasonably, to determine if all or part of the mineral resource may be classified as a mineral reserve ---------------- ------------------------------------------------ ppm Parts per million ---------------- ------------------------------------------------ PQ A diamond drill core diameter of 122.6 mm (outside of bit) and 85 mm (inside of bit) ---------------- ------------------------------------------------ Probable A 'Probable Ore Reserve' is the economically Ore Reserve mineable part of an Indicated, and in some circumstances, a Measured Mineral Resource. The confidence in the Modifying Factors applying to a Probable Ore Reserve is lower than that applying to a Proved Ore Reserve. ---------------- ------------------------------------------------ Proterozoic Geological Eon - from 2500Ma to 542Ma ---------------- ------------------------------------------------ Proved Ore A 'Proved Ore Reserve' is the economically Reserve mineable part of a Measured Mineral Resource. A Proved Ore Reserve implies a high degree of confidence in the Modifying Factors. ---------------- ------------------------------------------------ Psammite Metamorphosed sandstone ---------------- ------------------------------------------------ Pulps Final stage of sample preparation prior to analysis, typically pulverised to micron size and homogenised ---------------- ------------------------------------------------ Pyrite An iron sulphide with the chemical composition of FeS(2) ---------------- ------------------------------------------------ QA/QC Quality Assurance Quality Control ---------------- ------------------------------------------------ Quartz A common silicate mineral, composition SiO(2) ---------------- ------------------------------------------------ Quartz vein Intruded vein of quartz, typically younger than the host rock ---------------- ------------------------------------------------ RAB Rotary Air Blast. A form of open hole drilling where the drill cuttings are ejected by air, travelling to surface in the interface between the drill rod and the ground ---------------- ------------------------------------------------ RC Reverse Circulation. A form of drilling where the drill cuttings are ejected by air, travelling to surface within an opening within the drill stem itself ---------------- ------------------------------------------------ Raise A vertical underground excavation ---------------- ------------------------------------------------ Recovery Measurement of core loss (in meters( (Drill) or chip sample (in mass) to ascertain total drill recovery ---------------- ------------------------------------------------ Reserves Mineable geological resources ---------------- ------------------------------------------------ Residual A sample that is shorter than the sample composited length, after compositing ---------------- ------------------------------------------------ Resources Geological resources (both mineable and un-mineable) ---------------- ------------------------------------------------ RL Reduced Level. Elevation of the collar of a drill hole, a trench or a pit bench above the sea level ---------------- ------------------------------------------------ ROM Run of Mine ---------------- ------------------------------------------------ RQD Rock-quality designation, a geotechnical measurement of how fractured or broken a drill intersection is ---------------- ------------------------------------------------ Sample Specimen with analytically determined grade values for the components being studied ---------------- ------------------------------------------------ Seam filling A Datamine process of filling a wireframe, from a designated direction, which forms a single cell that honours the true thickness of the wireframe in that direction ---------------- ------------------------------------------------ Shear A structural discontinuity in a rock mass, typically resulting in non-brittle deformation and movement of blocks along a plane ---------------- ------------------------------------------------ Shrinkage A mining method used for steeply dipping, stoping narrower ore bodies with self-supporting walls and ore ---------------- ------------------------------------------------ Sill Variation value at which a variogram reaches a plateau ---------------- ------------------------------------------------ Silver Precious metal (Ag), atomic number: 47 ---------------- ------------------------------------------------ Single shot A surveying method, employing single film exposures to determine the azimuth and dip of the surveying instrument downhole ---------------- ------------------------------------------------ SMU Smallest Mining Unit, typically refers to a block whose dimensions match minimum mining block size expected mining methods ---------------- ------------------------------------------------ Snowden International Mining and Exploration Consultancy ---------------- ------------------------------------------------ SOP Standard Operating Procedure ---------------- ------------------------------------------------ Sphalerite The chief zinc sulphide mineral with a chemical composition of ZnS ---------------- ------------------------------------------------ Standards Certified Reference Materials (CRMs) samples which have a known constant geochemical value, inserted to ascertain laboratory precision ---------------- ------------------------------------------------ Stockworks A interconnected network of veins ---------------- ------------------------------------------------ Strike The orientation of a feature, in plan view, or as intersecting a horizontal plane ---------------- ------------------------------------------------ Sub-level Underground mining technique that stoping involves vertical mining in a large, open stope ---------------- ------------------------------------------------ Sulphides A mineral group that contains sulphur as the major anion ---------------- ------------------------------------------------ Support Equal support implies that all data has the same statistical weight ---------------- ------------------------------------------------ SURPAC A 3D mining software package ---------------- ------------------------------------------------ Swath plot A method of block model validation using a graph that compares input grades, drill metres, block model tonnes ---------------- ------------------------------------------------ t Tonnes ---------------- ------------------------------------------------ Telluride A mineral group that contains tellurium as the major anion ---------------- ------------------------------------------------ TMF Tailings Management Facility ---------------- ------------------------------------------------ Top cut A value to which anomalously high grades are restricted to, determined by statistical methods ---------------- ------------------------------------------------ Topography Detailed, precise description of the surface of the earth, based on XYZ data, to form a 3-D surface ---------------- ------------------------------------------------ Trench A method of sampling across and excavated trench at surface, using either hand-tools or a mechanical back-hoe. Used to expose fresh/less-weathered rock ---------------- ------------------------------------------------ Tropari A 'single-shot' method of surveying, using single film exposures to determine the azimuth and dip of the surveying instrument downhole ---------------- ------------------------------------------------ UC Uniform Conditioning, a non-linear "recoverable resource" estimation technique ---------------- ------------------------------------------------ UTM Universal Transverse Mercator ---------------- ------------------------------------------------ Variation In statistics, the measure of dispersion around the mean value of a data set ---------------- ------------------------------------------------ Variogram Graph showing variability of an element by increasing spacing between samples ---------------- ------------------------------------------------ Variography The process of constructing a semi-variogram ---------------- ------------------------------------------------ Vein A sheet like body of crystallized minerals intruded into a host rock ---------------- ------------------------------------------------ Waste Un-mineralised rock, or rock that is uneconomic to extract/process ---------------- ------------------------------------------------ Wireframe A 3-D digital model, typically an solid volume which encloses a geological domain ---------------- ------------------------------------------------ X The direction aligned with the x-axis of a coordinate system ---------------- ------------------------------------------------ Y The direction aligned with the y-axis of a coordinate system ---------------- ------------------------------------------------ Z The direction aligned with the z-axis of a coordinate system ---------------- ------------------------------------------------ Zn Zinc, atomic number 30 ---------------- ------------------------------------------------
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