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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Kefi Gold And Copper Plc | LSE:KEFI | London | Ordinary Share | GB00BD8GP619 | ORD 0.1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.014 | 2.59% | 0.554 | 0.554 | 0.56 | 0.56 | 0.54 | 0.54 | 28,970,836 | 16:35:19 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Metal Mining Services | 0 | -6.36M | -0.0013 | -4.23 | 27.31M |
From Apr 2019 to Apr 2024
TIDMKEFI
RNS Number : 3733P
Kefi Minerals plc
18 August 2014
This announcement amends and replaces the announcement of the Tulu Kapi Resource Update made by the Company on 18 August 2014 at 7am BST, issued under RNS number 3567P. The revised announcement includes an appendix detailing JORC compliance. All other details remain unchanged. The full amended text is shown below.
18 August 2014
KEFI Minerals Plc
("KEFI" or the "Company")
INDEPENDENTLY VERIFIED jorc COMPLIanT MINERAL resource reporting on TULU KAPI GOLD DEPOSIT in ETHIOPIA
KEFI Minerals (AIM: KEFI), the gold exploration and development company with projects in the Kingdom of Saudi Arabia and the Democratic Republic of Ethiopia, is pleased to announce an independently verified updated JORC compliant Mineral Resource reporting of total Indicated and Inferred Resource of 23.7 Mt at 2.51 g/t Au for 1.9 Moz Au at its Tulu Kapi project in Ethiopia.
KEFI Minerals is the manager and operator of the project under the Company's 75%-owned KEFI Minerals (Ethiopia) Limited ("KME") joint venture company with Nyota Minerals. The Competent Persons for the Resources are Simon Cleghorn, Resource Manager of KEFI, and Lynn Olssen, General Manager Geosciences and Senior Principal Consultant of Snowden Mining Industry Consultants Pty Ltd ("Snowden").
HIGHLIGHTS
-- A Mineral Resource of 1.9 Moz Au (23.7 Mt at 2.51 g/t Au), reported in accordance with the JORC Code (2012), has now been estimated after twelve months of intense review by KEFI and its independent specialists and after taking into account all drilling and trenching conducted to date along with improved understanding of geological structural controls. Several independent experts were consulted in formulating the appropriate process for Tulu Kapi and the final independent sign-off was provided by Snowden after taking into account all of the recommendations and data.
-- The Indicated Resource now stands at 18.4 Mt at 2.57 g/t Au for 1.5 Moz Au and is now being used to finalise pit design, mine scheduling and Ore Reserves.
-- The updated Indicated and Inferred Resources have been reported at a cut-off grade of 0.45 g/t Au above the 1,400 m reduced level (RL) to represent open pittable resources and at a cut-off grade of 2.50 g/t Au below the 1,400 mRL to represent potential underground mineable resources (tabulated below). Average surface RL in the planned pit is 1,750 mRL. These cut-off grades were based on appropriate computerised optimisation techniques after taking into account the final determination of internal dilution of the Mineral Resources, which were completed as part of the Definitive Feasibility Study carried out during 2012.
-- Total Indicated and Inferred Resource in the open pit area is 22.0 Mt at 2.27 g/t Au for 1.60 Moz Au and high grade mineralisation of 1.62 Mt at 5.81 g/t Au for 303,000 oz Au as underground potential, immediately below the planned open pit.
-- Independent Ore Reserve estimation is underway for the open cut and a preliminary economic study on the potential underground resource.
-- The overhaul of the project is now well-advanced, for robust and financeable economics in the context of current gold prices and capital markets. The modifications serve to increase project profitability by optimising mine design and mining plans and to reduce the capital requirements by downsizing the plant from 2 Mt pa to c.1.2 Mt pa and the mining fleet correspondingly.
Hot Features
Premium
Tonnes Au Ounces
Resource Category Reporting elevation (Mt) (g/t) (Moz)
------------------------ --------------------- ------- ------- -------
Open Pittable
at Cut-Off Grade 0.45 g/t
--------------------------------------------------------------------------
Indicated above 1,400 RL 17.3 2.37 1.32
Inferred above 1,400 RL 4.77 1.91 0.292
Indicated and Inferred above 1,400 RL 22.1 2.27 1.61
Underground Mining
--------------------------------------------------------------------------
at Cut-Off Grade 2.5 g/t
--------------------------------------------------------------------------
Indicated below 1,400 RL 1.07 5.88 0.202
Inferred below 1,400 RL 0.56 5.67 0.102
Indicated and Inferred below 1,400 RL 1.63 5.81 0.304
Total Combined Resources
--------------------------------------------------------------------------
Total Indicated All 18.4 2.57 1.52
Total Inferred All 5.33 2.30 0.394
Total Indicated and
inferred All 23.7 2.51 1.91
------------------------ --------------------- ------- ------- -------
Notes:
-- All figures are reported to three significant figures. This may result in discrepancies in the table due to rounding.
-- KEFI currently owns 75% of KEFI Minerals (Ethiopia) Ltd, which owns 100% of the Tulu Kapi gold project, and has conditionally contracted to purchase the remaining 25%.
Jeff Rayner, Managing Director of KEFI Minerals, commented:
"We are pleased that the independent review of the Tulu Kapi Resource and JORC compliant reporting validates our belief that we have an attractive open pit project and underground mining potential. This review gives us the correct internal resource dilution to accurately plan Tulu Kapi's development and production.
"The next step of producing the estimate of Probable Reserves is already advanced following which the independent reviews of our plans for project, community and finance will occur in quick succession. As a result, we are on track to lodge the mining licence application during Q4 2014, and, at the same time, expand project documentation for the planned project financing. All this gives the Board confidence that development will commence in 2015."
Enquiries
KEFI Minerals Plc Jeffrey Rayner +90 533 928 1913 Fox-Davies Capital (Nominated Adviser and Joint Broker) Jonathan Evans +44 203 463 5022 finnCap Ltd (Joint Broker) Elizabeth Johnson, Christopher Raggett +44 207 220 0500 Luther Pendragon (Financial PR) Harry Chathli, Claire Norbury, Ivana Petkova +44 207 618 9100
COMPETENT PERSONS STATEMENTS
The information in this report that relates to input data used for the Mineral Resources is based on, and fairly represents, information and supporting documentation - the compilation of which was overseen by Simon Cleghorn, Resource Manager and a full-time employee of KEFI and a Member of The Australasian Institute of Mining and Metallurgy. Simon Cleghorn has sufficient experience 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'. Simon Cleghornconsents to the inclusion in the report of the matters based on this information in the form and context in which it appears.
The information in this report that relates to the interpretation, estimation, classification and reporting of the Mineral Resources is based on, and fairly represents, information and supporting documentation - the compilation of which was reviewed by Lynn Olssen who is a Member of The Australasian Institute of Mining and Metallurgy and a full-time employee of Snowden Mining Industry Consultants Pty Ltd. Lynn Olssen has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which she 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'. Lynn Olssen consents to the inclusion in the report of the matters based on this information in the form and context in which it appears.
Further information on KEFI Minerals is available at www.kefi-minerals.com
BACKGROUND TO THE RESOURCE ESTIMATE
-- A number of resource estimates have been carried out at Tulu Kapi since 2009 by various consultants with an expanding database. There has been over 120 kilometres of drilling at Tulu Kapi and over $50 million spent on drilling, project due diligence and planning by previous owners.
-- The 2012 Definitive Feasibility Study resource estimate was published by the previous controlling shareholder of KME (the owner of Tulu Kapi) in October 2012. It was carried out using a semi-constrained block model in Datamine using the dynamic anisotropy methodology. The Mineral Resource estimate was reported above a cut-off grade of 0.3 g/t Au and totalled 14.59 Mt at 2.36 g/t Au for 1.108 Moz Au in the Indicated Resource, and 10.31 Mt at 2.30 g/t Au for 0.764 Moz Au in the Inferred Resource.
-- After acquiring 75% of KME (the owner of Tulu Kapi) in late December 2013, KEFI updated the existing database in January 2014 to incorporate 71 drillholes, totalling over 16,000 m of drilling that were drilled by the previous controller, post the cut-off date of the October 2012 resource estimate.
-- KEFI published its first resource update on 12 March 2014. KEFI used the same October 2012 resource estimation methodology after including more structural data, a corrected database and mining block estimates with the following dimensions: 5.0 m(X) by 5.0 m(Y) by 1.0 m(Z), with 1.0 m composited drillholes. KEFI's March 2014 Mineral Resource was reported in accordance with JORC Code (2012) above a 0.3 g/t Au cut-off and totalled 24.1 Mt at 2.64 g/t Au for 2.051 Moz Au, with an upgrade to 21.2 Mt Au at 2.73 g/t Au for 1.862 Moz in Indicated Resource and 2.9 Mt at 2.03 g/t Au for 0.189 Moz Au in Inferred Resource. The March Mineral Resource was independently reviewed by AMC Consultants Pty Ltd, Australia and all aspects were taken into account in the August 2014 Mineral Resource.
-- KEFI continually refined the resource estimate using additional structural data based on surface mapping and trenching plus a small programme of additional Reverse Circulation (RC) targeted at infill drilling and maximising structural interpretation. This work was performed during March to June 2014.
-- KEFI's resources update published today incorporated geostatistical parameters agreed with Snowden, after rigorous peer review of various aspects including variography, top-cuts and block sizing. The final recommendations as to how to best account for internal dilution resulted in mining block estimates with the following dimensions: 10.0 m(X) by 10.0 m(Y) by 1.5 m(Z), with 1.0m composited drillholes.
-- A tabular comparison of recently published resources, shown at a cut-off grade above 0.3 g/t Au for comparison purposes, as per that reported in the Nyota 2012 Definitive Feasibility Study is presented below.
Resource History Comparative Summary - Indicated + Inferred
based on a cut-off grade of 0.3 g/t Au
-------------------------------------------------------------------
Period Tonnes (M) Au g/t (M) Oz
--------------------------------- ------------ -------- --------
October 2012 24.9 2.34 1.90
KEFI March 2014 24.1 2.64 2.05
KEFI - Snowden August 2014 26.1 2.38 2.00
TECHNICAL NOTES ON THE RESOURCE ESTIMATE
-- The Tulu Kapi gold deposit is an orogenic gold deposit located in an area consisting of rocks ranging from Pre-Cambrian to Tertiary in age. The gold mineralisation at Tulu Kapi is hosted by an Upper Proterozoic age intrusive, which comprises a coarse grained syentite pluton. These rocks have been intruded into a volcano-sedimentary sequence that was subsequently transformed to mafic and sericitic schists. The Tulu Kapi primary mineralisation is hosted in mafic syenite.
-- The input data for the estimate comprised 722 drillholes and trenches totalling 118,738.3 m including 298 diamond drillholes (NQ, HQ and PQ diameter) for 72,032.9m, 342 RC drillholes for 45,611 m and 82 trenches for 1,094.4 m. All drilling and sampling was carried out using industry standard methods. Diamond drilling was sampled using half core while RC samples were riffle split prior to crushing and grinding. Analysis was by fire assay using a 50 g charge and AAS finish.
-- Industry standard QAQC sampling and analysis was carried out which indicates that there are acceptable levels of precision and accuracy.
-- Mineralisation domains were determined using a 0.3 g/t Au indicator estimate with dynamic anisotropy to align the estimation with the local dip and strike of the mineralisation trends. The indicator estimate was into a block model with parent cells of 5 mE by 5 mN by 1.5 mRL. The 0.3 g/t indicator was determined from a log-probability plot that showed a change in distribution at this grade. Indicator estimates that were greater than 0.37 (37%) were deemed to be mineralised. This was based on visual review of the probability estimate against the data to confirm continuity of mineralisation.
-- 1 m composites were coded within the mineralised domain and by major fault block ("Central Zone" and "UNDP Zone"). Given the shallow oxidation profile, no separation was carried out by oxidation domain.
-- The data distributions are highly skewed and typically have a high (>1.5) coefficient of variation (CV - ratio of standard deviation to the mean). As a result, top cuts were applied to prevent overestimation and smearing of the comparatively high values into surrounding blocks. Top cuts were 30 g/t Au for the Central and UNDP domains and impact on less than 1% of the grade population.
-- Grade estimation was carried out in CAE Studio 3 (Datamine) using ordinary kriging (OK) with dynamic anisotropy to align the estimation with the local dip and strike of the mineralisation trends, into 10 mE by 10 mN by 1.5 mRL parent cells. Block discretisation was set to 4 by 4 by 2 for dynamic anisotropy angles.
-- A kriging neighbourhood analysis (KNA) was carried out to determine optimal block size and estimation parameters. The estimation was performed on the mineralised and non-mineralised material defined within each domain (Central and North).
-- Estimation was run in a three pass kriging plan, the second and third passes using progressively larger search radii to enable the estimation of blocks un-estimated on the previous pass. The search parameters were derived from the variogram analysis, with the first search distances corresponding to the distance at half of the variogram sill value and the second search distance approximating up to the variogram range.
-- Blocks were estimated using a minimum of 10 with a maximum of 30 samples 6 minimum and 30 maximum for pass 2) and a maximum of 8 composites allowed per drillhole.
-- The maximum distance of extrapolation points within the method was 45 m.
-- A global (dry) density value of 1.4 t/m3 was used for all saprolite material. A global (dry) density value of 2.7 t/m3 was used for all fresh material.
-- For the central zone, search radii used during grade estimation were used together with a wireframe encompassing high confidence mineralisation to define classification. Consistent areas of blocks estimated in the first and second searches (within the variogram range) were classified as Indicated Resources and blocks consistently estimated in the third search pass were classified as Inferred Resources. The areas of Indicated Resources are typically drilled out on a 40 m by 40 m grid with areas of 20 m by 20 m.
-- The majority of Mineral Resources contained within the north fault block (UNDP) are classified as Inferred Resources, except for a portion representing more closely spaced drilling (approximately 40 m 40 m) which was estimated in first and second search passes.
-- The Mineral Resource has been reported as mineable by open pit methods above 1,400 mRL, which is the bottom out elevation for the pit optimisation shells generated as part of the definitive feasibility study. Below 1,400 mRL the Mineral Resource is reported as potentially mineable by underground methods.
-- The updated Indicated and Inferred Resources have been reported at a cut-off grade of 0.45 g/t Au above the 1,400 mRL to represent open pittable resources and at a cut-off grade of 2.50 g/t Au below the 1,400 mRL to represent potential underground mineable resources (tabulated above). Average surface RL in the planned pit is 1,750 mRL. These cut-off grades were based on appropriate computerised optimisation techniques after taking into account the final determination of internal dilution of the Mineral Resources, which were completed as part of the Definitive Feasibility Study carried out during 2012.
-- Snowden has independently validated the estimate and checked each stage of the estimation process including review of all parameters, macros and classification criteria. Snowden considers that there are no material issues with the estimate.
NOTES TO EDITOR
KEFI Minerals Plc
KEFI is now positioned as an operator of two advanced gold development projects within the highly prospective Arabian-Nubian Shield, with an attributable 1.6 Moz (75% of Tulu Kapi's 1.9 Moz and 40% of Jibal Qutman's 0.5 Moz) Au Mineral Resources (JORC 2012) plus significant resource growth potential. Upon closure of the acquisition by KEFI of 100% of KME, attributable in-situ gold would be 2.1 Moz (100% of Tulu Kapi's 1.9 Moz and 40% of Jibal Qutman's 0.5 Moz). KEFI targets that production at these projects generate cash flows for further exploration and expansion as warranted, recoupment of development costs and, when appropriate, dividends to shareholders.
Expected milestones for the remainder of 2014 include the following:
-- Independent verification of revised mine plan -- Independent verification of estimates for capex, opex and closure -- Closure of acquisition of the remaining 25% of Tulu Kapi -- Nyota shareholders to receive shares in KEFI -- Independent verification of Ore Reserves -- Assembly of bank syndicate and agreement of indicative terms sheet for project finance -- Re-activation of Tulu Kapi Mining Licence Application, suspended mid-2013 by Nyota -- Application for Jibal Qutman Mining Licence for G&M Joint Venture in Saudi Arabia
KEFI in Ethiopia
KEFI Minerals has conditionally acquired the remaining 25% to have 100% ownership of the Tulu Kapi licence in western Ethiopia and intends to refine the development plan for the project, aimed at reducing the previously planned capital and operating expenditure. Early research has yielded encouraging results and was summarised in recent announcements in respect of the Tulu Kapi acquisition transaction.
At the end of 2013, the Ethiopian Government improved the fiscal regime applying to the gold sector, and Tulu Kapi in particular. This included lowering the income tax rate for mining (to 25% from 35%); settling of repayment schedule for inherited VAT liability (over three years rather than up-front); the removal of VAT on future exploration drilling expenditure; lowering royalty on gold mining (to 7% from 8%); accelerating the depreciation of historical and future capital expenditure (over four years); and clarifying the workings of the Government's 5% free-carried interest so that it does not impede conventional project financing terms.
KEFI Minerals in the Kingdom of Saudi Arabia
In 2009, KEFI formed the Gold and Minerals Joint Venture Company ("G&M") in Saudi Arabia with local Saudi partner Abdul Rahman Saad Al-Rashid & Sons Company Limited ("ARTAR"), to explore for gold and associated metals in the Arabian Shield. To date, the G&M has conducted preliminary regional reconnaissance and lodged 30 Exploration Licence Applications (ELAs), of which four have been granted. Two of the granted ELs were relinquished in May 2014.
The ELAs were initially applied for and granted to ARTAR. Incorporation of G&M has been completed and any granted Licences will be transferred into G&M in due course.
The Kingdom of Saudi Arabia has instituted policies to encourage minerals exploration and development and KEFI Minerals supports this priority by serving as the technical partner within G&M. ARTAR also serves this government policy as the major partner in G&M, which is one of the early movers in the modern resurgence of the Kingdom's minerals sector.
DEFINITIONS OF EXPLORATION RESULTS, RESOURCES & RESERVES
EXTRACTED FROM THE JORC CODE: (December 2012) (www.jorc.org)
A 'Mineral Resource' is a concentration or occurrence of material 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.
An 'Inferred Mineral Resource' is that part of a Mineral Resource for which quantity and grade (or quality) are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological and grade (or quality) continuity. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. An Inferred Mineral Resource has a lower level of confidence than that applying to an Indicated Mineral Resource and must not be converted to an Ore Reserve. It is reasonably expected that the majority of Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration.
An 'Indicated Mineral Resource' is that part of a Mineral Resource for which quantity, grade (or quality), densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of Modifying Factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit. Geological evidence is derived from adequately detailed and reliable exploration, sampling and testing gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes, and is sufficient to assume geological and grade (or quality) continuity between points of observation where data and samples are gathered. An Indicated Mineral Resource has a lower level of confidence than that applying to a Measured Mineral Resource and may only be converted to a Probable Ore Reserve.
A 'Measured Mineral Resource' is that part of a Mineral Resource for which quantity, grade (or quality), densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application of Modifying Factors to support detailed mine planning and final evaluation of the economic viability of the deposit. Geological evidence is derived from detailed and reliable exploration, sampling and testing gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes, and is sufficient to confirm geological and grade (or quality) continuity between points of observation where data and samples are gathered. A Measured Mineral Resource has a higher level of confidence than that applying to either an Indicated Mineral Resource or an Inferred Mineral Resource. It may be converted to a Proved Ore Reserve or under certain circumstances to a Probable Ore Reserve.
An 'Ore Reserve' is the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted and is defined by studies at Pre-Feasibility or Feasibility level as appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified. The reference point at which Reserves are defined, usually the point where the ore is delivered to the processing plant, must be stated. It is important that, in all situations where the reference point is different, such as for a saleable product, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported.
APPENDIX
JORC Code, 2012 Edition - Table 1 report Kefi Minerals - Tulu Kapi February 2014
Section 1 Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria JORC Code explanation Commentary
Sampling
techniques * Nature and quality of sampling (eg cut channels, * For diamond drill core, after delivery to a dedicated
random chips, or specific specialised industry core yard, core was photographed and sample intervals
standard measurement tools appropriate to the were marked by a geologist and the core was split
minerals under investigation, such as down hole gamma using Clipper diamond core saws. Core recovery and
sondes, or handheld XRF instruments, etc). These RQD were measured at the diamond drill site right out
examples should not be taken as limiting the broad of the inner tube using trained technicians. Half
meaning of sampling. core samples were submitted to the on site
preparation facility for drying, crushing and
pulverizing. The samples were typically taken at 1 m
* Include reference to measures taken to ensure sample intervals in expected mineralisation and 2m intervals
representivity and the appropriate calibration of any in expected waste except where the samples crossed
measurement tools or systems used. lithological boundaries. In this instance, the
samples were terminated at the lithological contact.
All samples taken were greater than 30 cm in length.
* Aspects of the determination of mineralisation that Sampling of diamond core followed industry standard
are Material to the Public Report. procedures.
* In cases where 'industry standard' work has been done * RC drill samples were sampled every meter and were
this would be relatively simple (eg 'reverse bagged and riffle split at the drillhole if they were
circulation drilling was used to obtain 1 m samples dry and a sample of approximately 3 kg was kept for
from which 3 kg was pulverised to produce a 30 g sample preparation. RC samples were submitted to the
charge for fire assay'). In other cases more on site preparation facility for drying, crushing and
explanation may be required, such as where there is pulverizing. Sampling of dry RC chips followed
coarse gold that has inherent sampling problems. industry standard procedures.
Unusual commodities or mineralisation types (eg
submarine nodules) may warrant disclosure of detailed
information. * Wet RC samples were taken in their entirety to the
sample storage facility and riffle split with a clean
water wash between splits. Wet RC samples were
submitted to the on site preparation facility for
drying, crushing and pulverizing. Splitting of wet RC
samples is not ideal however care was taken to ensure
riffle splitters were kept clean and sample quality
was considered to be acceptable.
* Trench samples were collected from trenches that were
dug by hand and up to 3 meters deep. Samples were
collected under the supervision of the senior
geologist from the base of the trench using either a
geologist's pick or a jack-hammer in the harder rock.
Samples were taken at 1 m intervals except where
lithological boundaries were crossed and the minimum
sample length is 0.3 m.
* Appropriate care was taken by supervising geologists
at the drillhole and at the sample storage facility
to process both diamond core and RC chip samples.
Lithologies were respected as boundaries for sampling
where a mineralized lithological unit was greater
than 0.3 m drilled thickness.
* Both diamond drill core and RC chips samples were
sample prepped and assayed via an industry standard
procedure. Sample prep was carried out onsite and the
resulting 100 g pulp assayed by fire assay using a 50
g charge and AAS finish.
Drilling
techniques * Drill type (eg core, reverse circulation, open-hole * Diamond drilling was carried out with typically 3
hammer, rotary air blast, auger, Bangka, sonic, etc) core diameters, PQ (8 5mm) in saprolite and through
and details (eg core diameter, triple or standard the saprolite to the fresh/transitional boundary, HQ
tube, depth of diamond tails, face-sampling bit or (63mm) to a depth of 100 m and NQ (47mm) to depths
other type, whether core is oriented and if so, by beyond 100 m. All diamond core was orientated
what method, etc). .Downhole survey was carried out via an EZTrack
survey system by Reflex with an initial survey
carried out at 25 m and then a survey carried out at
every 50 m from then on. Non vertical diamond drill
holes following TKBH_080 were oriented using Reflex
ACT II and ACT III orientation instruments. Three
consecutive runs which lined up within 10 degrees of
one another were considered to be of high confidence
orientation.
* RC drilling was carried out with a face sampling
hammer and 8 inch bit in the saprolite layer reducing
to a 3 1/2 inch bit in the fresh material. RC holes
were surveyed using the Reflex EZ Track inside 6 m of
stainless steel rods which immediately followed the
hammer. Survey frequency was every 50 m;
* 722 drillholes and trenches totaling 118,738.3 m were
used in the preparation of the resource estimate
including:
* 298 diamond drillholes (NQ, HQ and PQ diameter) for
72,032.9 m.
* 342 reverse circulation drillholes for 45,611 m.
* 82 trenches for 1,094.4 m.
Drill sample
recovery * Method of recording and assessing core and chip * Diamond drill core sample lengths were measured and
sample recoveries and results assessed. lengths recoded after logging in order to be able to
determine core recovery. Core recovery averaged 95%
through all rock types and types of ground. Due to
* Measures taken to maximise sample recovery and ensure good recoveries, triple tubing was not used.
representative nature of the samples.
* Kefi's RC drill chip samples of 1 m were weighed and
* Whether a relationship exists between sample recovery weight recorded to determine if weight was within a
and grade and whether sample bias may have occurred satisfactory range compared to the expected 25 kg.
due to preferential loss/gain of fine/coarse Previous operators also recorded sample recovery by
material. percentage or weight for 58% of RC holes.
* Recording of core sample lengths against drill meters
and RC drill chip samples against expected weight was
well documented and records available in a verified
database.
* Sample recovery is good at Tulu Kapi due to the
competent granitoid ground and relatively thin
overburden and completely oxidized horizon. For
diamond drilling, PQ diameter was used for collaring
holes to maximize recovery in the clay rich ground.
Also, water feed was turned down and down force
increased to prevent material from washing out of the
inner tube.
* Drilling of RC samples below the water table showed a
variability in sample weights for wet samples.
Previous statistical studies during the definitive
feasibility study suggested wet RC samples tended to
underestimate gold grade compared to diamond drill
samples below the water table.
Logging
* Whether core and chip samples have been geologically * For diamond drill core and RC drill chips, logging
and geotechnically logged to a level of detail to was carried out to determine mineralization intervals
support appropriate Mineral Resource estimation, based on alteration type, presence of quartz veining
mining studies and metallurgical studies. and sulphide occurrence.
* Whether logging is qualitative or quantitative in * Diamond drill core was logged for lithology,
nature. Core (or costean, channel, etc) photography. structure, texture, mineralization, alteration type,
color and weathering intensity and sulphide
occurrence. Core was photographed in the trays at the
* The total length and percentage of the relevant sample storage facility. RMR and Q systems were
intersections logged. logged for the geotechnical programs for all diamond
drilling from TKBH_080, excluding the 20m by 20 m
infill program. The half core not sampled is stored
in a locked secure shed for future reference.
* RC drill chips were logged for lithology, alteration
and mineralization type and a small sample kept from
each meter in plastic chip trays as a logging record
in a locked secure shed
* Trenches were logged for lithology, alteration and
mineralization type and were all photographed before
being filled back in.
* Up to 2012, primary data gathered in the field were
recorded on paper logging sheets which is then
transferred to an electronic Access master database
via a trained database manager. Following 2012,
electronic logging was carried out for geological and
geotechnical logging.
* All sample intervals returned from drilling
activities were logged.
* Kefi consider that geological and geo-technical
logging has been carried out to an appropriate level
to support resource estimation and mine planning
studies.
Sub-sampling
techniques * If core, whether cut or sawn and whether quarter, * Core was sawn with Clipper core saws and half taken
and sample half or all core taken. for sample preparation and assay.
preparation
* If non-core, whether riffled, tube sampled, rotary * RC chips were riffle sampled at the drill site if dry
split, etc and whether sampled wet or dry. and riffle sampled at the sample storage facility if
wet.
* For all sample types, the nature, quality and
appropriateness of the sample preparation technique. * Sample sizes are industry standard for the type of
rock and mineralization being sampled.
* Quality control procedures adopted for all
sub-sampling stages to maximize representivity of * Sample preparation was carried out onsite by trained
samples. staff following industry standard procedure with the
assistance of a professional laboratory manager to
train and monitor performance.
* Measures taken to ensure that the sampling is
representative of the in situ material collected,
including for instance results for field * A total of four QAQC samples were inserted into the
duplicate/second-half sampling. sample stream for every 20 samples processed and
included a blank (local Ambo sandstone), standard,
crush duplicate and pulp duplicate. A blank sample
* Whether sample sizes are appropriate to the grain was also processed after every sample through the jaw
size of the material being sampled. crusher and pulveriser in order to prevent
contamination.
* The database is constructed so that automatic checks
on the input data are carried out with both crushed
and pulp duplicates plotted against the primary
sample value.
* Snowden reviewed the QAQC results for standards,
duplicates and blanks and considers the precision and
accuracy acceptable for this style of deposit.
* All diamond half core has been kept stored in a
secure sample storage facility as has a 200 to 250 g
pulp duplicate (from the on site sample preparation
lab) from RC drill meters. Duplicate samples have not
been processed but are available for processing.
Quality
of assay * The nature, quality and appropriateness of the * Assaying and laboratory procedures are industry
data and assaying and laboratory procedures used and whether standard.
laboratory the technique is considered partial or total.
tests
* Analysis of assays was carried out at a certified
* For geophysical tools, spectrometers, handheld XRF laboratory, ALS Laboratory Group, Johannesburg, South
instruments, etc, the parameters used in determining Africa using a certified method (Au-AA26) with
the analysis including instrument make and model, certified instruments.
reading times, calibrations factors applied and their
derivation, etc.
* ALS Laboratories Group internal checks as per their
standard operating procedure were used for laboratory
* Nature of quality control procedures adopted (eg testwork. This results in the equivalent of 10% of
standards, blanks, duplicates, external laboratory the total samples received being independently
checks) and whether acceptable levels of accuracy (ie re-assayed as QAQC samples.
lack of bias) and precision have been established.
* In 2012, 5% of mineralized samples were re assayed by
SGS Perth and no material difference was found
between the original ALS assays and the SGS umpire
results.
* Grind size testing is carried out and the results
recorded in a laboratory log book. Digitization of
this data is in progress.
* More recent exploration by Kefi has followed the same
procedures using ALS Romania and Al Amri in Saudi
Arabia.
Verification
of sampling * The verification of significant intersections by * Significant intercepts were reviewed and verified
and assaying either independent or alternative company personnel. visually by an independent consultancy, Wardell
Armstrong, as part of preparing the resource
statement for a definitive feasibility study carried
* The use of twinned holes. out in November 2012.
* Documentation of primary data, data entry procedures, * Kefi Minerals Plc senior geological staff have also
data verification, data storage (physical and carried out in intensive 6 month review of
electronic) protocols. significant intersections and associated data.
* Discuss any adjustment to assay data. * Twinned holes have not been used on significant
intercepts.
* Up to 2012, primary data gathered in the field were
recorded on paper logging sheets which is then
transferred to an electronic database via a trained
database manager. Following 2012, electronic logging
was carried out for geological and geotechnical
logging.
* Assay results returned to the project from ALS were
received in Excel format and copied in an in-house
designed Access database.
* The database is constructed so that automatic checks
on the input data are carried out with both crushed
and pulp duplicates plotted against the primary
sample value.
* No adjustment to assay data has been carried out.
Location
of data * Accuracy and quality of surveys used to locate drill * Drillhole and trench collar co-ordinates are
points holes (collar and down-hole surveys), trenches, mine initially located using GPS. When drilling has been
workings and other locations used in Mineral Resource completed, the collar location is re-surveyed using a
estimation. Total Station by a geological survey team from Addis
Ababa.
* Specification of the grid system used.
* WGS84-Zone 36N grid was used.
* Quality and adequacy of topographic control.
* In 2012, Light Detecting and Ranging ("LiDAR") survey
of the Tulu Kapi area was commissioned and new color
orthographic photos, covering some 52 km(2) (5,200
ha), as this provides complete and coverage of the
project, given the remote and rugged terrain in the
area. This survey was completed by Fugro MAPS of
United Arab Emirates (Fugro).
* From observations it is apparent that the LIDAR has
some discrepancies with the drillhole collars not
matching the LIDAR generated digital terrain model.
The average difference between the LIDAR survey and
the collars is 2.7 m. For this resource estimate the
digital terrain model that was generated by the LIDAR
survey has subsequently been lowered by 2.7 m to
better fit the drillhole collars. There are still
small discrepancies between the LIDAR generated
digital terrain model and the drillhole collars and
it is recommended that a topographic survey is
completed before the next resource estimate
Data spacing
and * Data spacing for reporting of Exploration Results. * 40 m by 40 m to 40 m by 20 m through the central part
distribution of the deposit to 40 m by 80 m at the peripheries.
* Whether the data spacing and distribution is
sufficient to establish the degree of geological and * From surface mapping, on strike continuity is on the
grade continuity appropriate for the Mineral Resource 100 m scale.
and Ore Reserve estimation procedure(s) and
classifications applied.
* Snowden and Kefi consider the drill spacing
appropriate for the current classification of the
* Whether sample compositing has been applied. Mineral Resource.
* A 1 m sample composite length downhole has been
applied after histogram analysis of sample length
indicates the predominant sample length to be 1 m.
Orientation
of data * Whether the orientation of sampling achieves unbiased * Drilling has generally been carried out on a 40 m
in relation sampling of possible structures and the extent to grid orientated at an azimuth of 050deg or
to which this is known, considering the deposit type. vertically. The mineralization is interpreted to
geological strike NNE-SSW and dip 30deg to the northwest, the
structure drilling orientation is not ideal for sampling the
* If the relationship between the drilling orientation principal mineralization orientation however
and the orientation of key mineralised structures is sufficient data density exists and sufficient work
considered to have introduced a sampling bias, this has been carried out via drillhole logging, detailed
should be assessed and reported if material. mapping and statistical analysis that the sampling is
considered to be unbiased.
* Sampling is not considered to be biased.
Sample
security * The measures taken to ensure sample security. * Previous quality assurance protocol documentation and
independent QAQC audits undertaken by Venmyn
Consultants (2009/2010) indicate that all chain of
custody procedures have been in place and followed
from early on in the exploration process. Custody
procedures included and cover the signing-off of
sheets for the transfer of core from rig to core shed,
core sampling to sample preparation and prepared
samples from sample preparation facilities to Addis
Abba and then by air freight to ALS in Johannesburg
and receipt of samples at the analytical laboratory.
* More recent exploration by Kefi has followed the same
procedures with ALS Romania and Al Amri in Saudi
Arabia.
Audits or
reviews * The results of any audits or reviews of sampling * A significant amount of independent auditing and
techniques and data. review of sampling techniques and data have been
carried out by a variety of consultants since 2009,
including Wardell Armstrong for the 2012 definitive
feasibility study who considered no significant
issues regarding the integrity of the database and
that it was fit for purpose.
* As part of the August 2014 Mineral Resource, Snowden
has independently validated the database and found no
material issues. Snowden considers the database
appropriate for use in resource estimation.
============= ============================================================ =================================================================
Section 2 Reporting of Exploration Results
(Criteria listed in the preceding section also apply to this section.)
Criteria JORC Code explanation Commentary
Mineral
tenement * Type, reference name/number, location and ownership * The Tulu Kapi license was originally granted to
and land including agreements or material issues with third Golden Prospect Mining Company Limited ("GPMC") in
tenure status parties such as joint ventures, partnerships, May 2005 as the Tulu Kapi and Ankore Exploration
overriding royalties, native title interests, License, number 127-128/97, covering an area of 20.32
historical sites, wilderness or national park and km2. GPMC was acquired by Nyota and became a wholly
environmental settings. owned subsidiary in October 2009 and subsequently
changed its name to Nyota Minerals (Ethiopia) Limited
("Nyota (Ethiopia)"). Since its grant in 2005
* The security of the tenure held at the time of portions of the license area have been progressively
reporting along with any known impediments to relinquished as required under Ethiopian mining law,
obtaining a licence to operate in the area. such that it now consists of an irregular polygonal
shape having a total area of 8.44 km2.
* In addition to the Tulu Kapi license, the Tulu Kapi
project and the conversion application include the
adjacent Ankore license areas, for a total area
covered, of 11.33 km2.
* The Tulu Kapi license is currently an exploration
license (EL). An application to convert it to a Large
Scale Mining License (MLA) was made on 11 May 2011.
Under Ethiopian law an exploration license gives the
holder the exclusive right to explore for minerals
within the area specified in the license for an
initial period of three years. The license may be
renewed twice for additional terms of one year each.
The licensing authority may further allow extension
or renewal to be made on each anniversary where the
licensee proves the necessity to undertake
exploration activity beyond the initial work
programme, provided such period does not exceed a
further five years in total.
The Tulu Kapi licence was in its third renewal
period (issued 25 May 2010 for a period of
one year) when Nyota applied for a mining license
on 11 May 2011. Nyota received assurances from
the Ministry of Mines that title to the Tulu
Kapi license endures while the mining license
application is processed.
* Nyota withdrew the MLA in 2013 and in 2013, the Tulu
Kapi EL was renewed to May 2015.
* KEFI Minerals Plc (KEFI) acquired 75% of the share
capital of Nyota Minerals (Ethiopia) Ltd (NME), the
owner of the Tulu Kapi Project and surrounding
Exploration Licenses, in December 2013.
* NME underwent a name change in 2014 to KEFI Minerals
(Ethiopia) Ltd (KME).
* KEFI announced the acquisition of the remaining 25%
of KME in June 2014. The sale is subject to
shareholder approval by Nyota Minerals Ltd, which
will be held by Nyota General Meeting on 27 August
2014.
Exploration
done by * Acknowledgment and appraisal of exploration by other * An Italian company, SAPIE, discovered the Tulu Kapi
other parties parties. project in the 1930's and mined 947,000 m(3) at 1.22
g/m(3) for 1,154 kg of gold.
* The earliest formal exploration of the Tulu Kapi area
took place in the 1970s under the guidance of the
UNDP, which undertook reconnaissance exploration over
a wide area of western Ethiopia between 1969 and
1972. The work was largely reconnaissance level and
regionally biased and included stream sediment and
soil geochemical sampling, programmes, geophysical
surveys, detailed geological mapping, and diamond
drilling.
* Tan Range Exploration Company (TREC), a Canadian
registered company, acquired an exploration license
over an area that incorporated the current Tulu Kapi
license and undertook further exploration between
1996 and 1998, including detailed geochemical soil
sampling, mobile metal ion (MMI) soil geochemistry,
and an induced polarisation (IP) survey. Five diamond
drill holes totaling 366 m were drilled in a 200 m by
200 m area immediately north of the old SAPIE mining
area which targeted coincident geochemical soil and
IP anomalies.
* The Tulu Kapi - Ankore Exploration License (Tulu Kapi
or Tulu Kapi License) was granted to Minerva
Resources through its wholly owned subsidiary Golden
Prospect Mining Company (GPMC) on 27 May 2005. GPMC
undertook further detailed geological mapping,
trenching, geophysics and diamond drilling within the
license area and the data generated by TREC was
adopted subsequently by GPMC who geo-referenced it to
UTM coordinates from local grids. In 2006 GPMC
excavated two new trenches and undertook geological
mapping and sampling. It subsequently conducted
IP-resistivity surveys (two profiles aligned along a
northeast-southwest direction) covering an area of
400 m by 400 m in May 2009 and additional gradient
resistivity work covering an area of 800 m by 400 m
and a ground magnetic survey covering 2.5 km by 1.2
km. Diamond drilling was carried out on an 80 m by 80
m grid and included 34 inclined holes, centered on
gold soil anomalies, to a maximum depth of 200 m.
* Minerva Resources (GPMC's parent company) was
acquired by Dwyka Resources Limited (now Nyota
Minerals Limited) in July 2009, making GPMC a wholly
owned subsidiary. Following this acquisition an
aggressive exploration programme commenced,
comprising some early trenches (14), exploration /
resource definition drilling and infill resource
drilling using both diamond drilling and reverse
circulation (RC) drilling.
* Up to December 2012 296 diamond drillholes (DD) for a
total of 72,000 m, including the 34 diamond
drillholes completed by GPMC and 38 diamond tails for
10,541 m; and 332 RC drillholes for a total of 45,000
m, have been completed at Tulu Kapi.
* Since acquisition of the Project by Nyota, Mineral
Resource estimates reported in compliance with the
JORC Code and a NI 43-101 PEA have been completed by
independent geological and mining consultants,
Hellman and Schofield ("H&S") of Australia, Venmyn
Rand (Pty) Ltd ("Venmyn") of South Africa , SRK
Consulting ("SRK") of the UK and Wardell Armstrong
("WAI") of the UK.
Geology
* Deposit type, geological setting and style of * The Tulu Kapi gold deposit is an orogenic gold
mineralisation. deposit located in an area consisting of rocks
ranging from Pre-Cambrian to Tertiary in age. The
gold mineralisation at Tulu Kapi is hosted by an
Upper Proterozoic age intrusive, which comprises a
coarse grained syentite pluton. These rocks have been
intruded into a volcano-sedimentary sequence that was
subsequently transformed to mafic and sericitic
schists.
* The Tulu Kapi primary mineralisation is hosted in
mafic syenite. The unaltered syenite is predominantly
a medium to coarse grained rock composed of 60 to 70%
pink to white alkali feldspar, 20 to 25% plagioclase,
and 10 to 15% ferromagnesian minerals and minor
interstitial quartz. The ferromagnesian minerals
consist mainly of biotite with minor amphibole and
magnetite. The mineralisation is associated with
shallow (approximately 30deg) north-west dipping
zones of quartz-veined, highly albitised, metasomatic
alteration centered on the Bedele Shear zone.
* The albitised zones are of a lensoid nature
comprising discrete stacked bodies that pinch and
swell both along strike and down dip. A gradational
contact of only a few centimeters with the unaltered
mafic syenite is exhibited and the thickness of the
individual albitised zones is highly variable. Mafic
rocks (dolerite) representing dykes and / or sills
are present within the syenite and are up to 10 m in
thickness.
Drill hole
Information * A summary of all information material to the * No exploration conducted during the period covered by
understanding of the exploration results including a the Resource statement.
tabulation of the following information for all
Material drill holes:
o easting and northing of the drill hole collar
o elevation or RL (Reduced Level - elevation
above sea level in metres) of the drill hole
collar
o dip and azimuth of the hole
o down hole length and interception depth
o hole length.
* If the exclusion of this information is justified on
the basis that the information is not Material and
this exclusion does not detract from the
understanding of the report, the Competent Person
should clearly explain why this is the case.
Data
aggregation * In reporting Exploration Results, weighting averaging * No exploration conducted during the period covered by
methods techniques, maximum and/or minimum grade truncations the Resource statement.
(eg cutting of high grades) and cut-off grades are
usually Material and should be stated.
* Where aggregate intercepts incorporate short lengths
of high grade results and longer lengths of low grade
results, the procedure used for such aggregation
should be stated and some typical examples of such
aggregations should be shown in detail.
* The assumptions used for any reporting of metal
equivalent values should be clearly stated.
Relationship
between * These relationships are particularly important in the * No exploration conducted during the period covered by
mineralisation reporting of Exploration Results. the Resource statement.
widths and
intercept
lengths * If the geometry of the mineralisation with respect to
the drill hole angle is known, its nature should be
reported.
* If it is not known and only the down hole lengths are
reported, there should be a clear statement to this
effect (eg 'down hole length, true width not known').
Diagrams
* Appropriate maps and sections (with scales) and * No exploration conducted during the period covered by
tabulations of intercepts should be included for any the Resource statement.
significant discovery being reported These should
include, but not be limited to a plan view of drill
hole collar locations and appropriate sectional
views.
Balanced
reporting * Where comprehensive reporting of all Exploration * No exploration conducted during the period covered by
Results is not practicable, representative reporting the Resource statement.
of both low and high grades and/or widths should be
practiced to avoid misleading reporting of
Exploration Results.
Other
substantive * Other exploration data, if meaningful and material, * No exploration conducted during the period covered by
exploration should be reported including (but not limited to): the Resource statement.
data geological observations; geophysical survey results;
geochemical survey results; bulk samples - size and
method of treatment; metallurgical test results; bulk
density, groundwater, geotechnical and rock
characteristics; potential deleterious or
contaminating substances.
Further
work * The nature and scale of planned further work (eg * No further work is planned prior to completion of
tests for lateral extensions or depth extensions or detailed mine planning studies.
large-scale step-out drilling).
* Diagrams clearly highlighting the areas of possible
extensions, including the main geological
interpretations and future drilling areas, provided
this information is not commercially sensitive.
=============== =============================================================== ===============================================================
Section 3 Estimation and Reporting of Mineral Resources
(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)
Criteria JORC Code explanation Commentary
Database
integrity * Measures taken to ensure that data has not been * Exploration work was conducted under a quality
corrupted by, for example, transcription or keying management system involving all stages of exploration,
errors, between its initial collection and its use from the drilling and sample collection to resource
for Mineral Resource estimation purposes. estimation. All field data were either captured by
hard copy and subsequently uploaded to a spread sheet
system or captured electronically, checked for
* Data validation procedures used. consistency and added to the database with all
original entered spreadsheets stored. The database
was checked for input errors at different stages,
from the field office to the head office in Addis
Ababa. The master database is managed by a Geological
Database / GIS Manager based at Tulu Kapi, with
quality control and sampling protocol coordinated by
a quality control manager.
* Snowden carried out basic validation checks on the
data supplied by the Company prior to resource
estimation. No significant errors were identified by
the validation.
Site visits
* Comment on any site visits undertaken by the * Extensive site visits carried out by Kefi personnel
Competent Person and the outcome of those visits. over a period of 9 months for data verification and
review including working with local staff on-site who
have a long history with the project and qualified
* If no site visits have been undertaken indicate why expatriate staff also familiar with the project. All
this is the case. relevant data, physical and digital were reviewed as
well as technical procedures for cataloguing,
recording, storing and using the results of data. No
significant issues or problems were observed.
* A site visit was completed by Snowden between 17 July
and 23 July 2014. The site visit included review of
general geology, drilling, sampling and assaying
procedures, onsite laboratory, bulk density
measurement procedure, logging procedures and QAQC.
No material issues or problems were observed.
Geological
interpretation * Confidence in (or conversely, the uncertainty of ) * Geological and structural interpretation of the Tulu
the geological interpretation of the mineral deposit. Kapi area has been based on surface mapping and
drillhole interpretation and logging by a variety of
consultants and qualified national staff working for
* Nature of the data used and of any assumptions made. the project since 2009. All data available has been
used and is also available for review in digital or
analogue format
* The effect, if any, of alternative interpretations on
Mineral Resource estimation.
* An alternative interpretation is only likely to be
regarding subtle controls on mineralization,
* The use of geology in guiding and controlling Mineral particularly local variations in strike, dip and
Resource estimation. thickness of mineralized zones and is unlikely to
materially affect the estimate.
* The factors affecting continuity both of grade and
geology. * Mineralisation domains were determined using a 0.3
g/t Au indicator estimate with dynamic anisotropy to
align the estimation with the local dip and strike of
the mineralisation trends. The indicator estimate was
into a block model with parent cells of 5 mE by 5 mN
by 1.5 mRL. The 0.3 g/t indicator was determined from
a log-probability plot that showed a change in
distribution at this grade. Indicator estimates that
were greater than 0.37 (37%) were deemed to be
mineralized. This was based on visual review of the
probability estimate against the data to confirm
continuity of mineralisation.
* For the dynamic anisotropy, dip and strike strings
were used to define the orientation of the
mineralized structure. Dip strings were based on the
updated 2012/2013 structural interpretation in which
the mineralization was defined by structures which
dip around 30deg to the northwest. Dip strings were
generated on 20 m section spacing and attempted to
join intersections in which grade continuity was
identified. Strike strings were generated on
horizontal sections with a section density of 2.5 m.
* Mineralised domains are defined within the Central
and UNDP (Northern) areas of the deposit which are
separated by faulting.
* A complex structural environment and genesis exists
with narrow shallowly dipping stacked veins which
pinch and swell along strike and down dip.
* The relationship with grade, alteration, quartz
veining and structure are not yet fully understood
however structural geology interpretation and
investigation is beginning to improve the
understanding of the factors controlling grade
continuity.
Dimensions
* The extent and variability of the Mineral Resource * Mineralization as modeled extends for some 980 m
expressed as length (along strike or otherwise), plan along strike, 520 m in width near surface and
width, and depth below surface to the upper and lower extending to a depth of some 560 m. Mineralization
limits of the Mineral Resource. narrows to the south and narrows to the north at
depth within the currently interpreted mineralization
boundaries.
Estimation
and modelling * The nature and appropriateness of the estimation * The 1 m composites were coded within the mineralised
techniques technique(s) applied and key assumptions, including domain and by major fault block (Central and UNDP).
treatment of extreme grade values, domaining, Given the shallow oxidation profile, no separation
interpolation parameters and maximum distance of was carried out by oxidation domain.
extrapolation from data points. If a computer
assisted estimation method was chosen include a
description of computer software and parameters used. * The data distributions are highly skewed and
typically have a high (>1.5) coefficient of variation
(CV - ratio of standard deviation to the mean). As a
* The availability of check estimates, previous result, top cuts were applied to prevent
estimates and/or mine production records and whether overestimation and smearing of the comparatively high
the Mineral Resource estimate takes appropriate values into surrounding blocks. Top cuts were 30 g/t
account of such data. Au for the Central and UNDP domains and impact on
less than 1% of the grade population.
* The assumptions made regarding recovery of
by-products. * Grade estimation was carried out in CAE Studio 3
(Datamine) using ordinary kriging (OK) with dynamic
anisotropy to align the estimation with the local dip
* Estimation of deleterious elements or other non-grade and strike of the mineralisation trends, into 10 mE
variables of economic significance (eg sulphur for by 10 mN by 1.5 mRL parent cells. Block
acid mine drainage characterisation). discretisation was set to 4 by 4 by 2.
* In the case of block model interpolation, the block * A kriging neighbourhood analysis (KNA) was carried
size in relation to the average sample spacing and out to determine optimal block size and estimation
the search employed. parameters. The estimation was performed on the
mineralised and non-mineralised material defined
within each domain (Central and North).
* Any assumptions behind modelling of selective mining
units.
* Estimation was run in a three pass kriging plan, the
second and third passes using progressively larger
* Any assumptions about correlation between variables. search radii to enable the estimation of blocks
unestimated on the previous pass. The search
parameters were derived from the variogram analysis,
* Description of how the geological interpretation was with the first search distances corresponding to the
used to control the resource estimates. distance at half of the variogram sill value and the
second search distance approximating up to the
variogram range.
* Discussion of basis for using or not using grade
cutting or capping.
* Blocks were estimated using a minimum of 10 with a
maximum of 30 samples 6 minimum and 30 maximum for
* The process of validation, the checking process used, pass 2) and a maximum of 8 composites allowed per
the comparison of model data to drill hole data, and drillhole.
use of reconciliation data if available.
* The maximum distance of extrapolation points within
the method was 45 m.
* The previous resource estimate was carried out by
Kefi in February 2014. Comparison between the August
2014 and February 2014 estimates shows the most
recent estimate has reported 8% more tonnes, 12% less
grade and 3% less ounces than the February 2014
estimate. This is based on the potential for both
open pit and underground mining using cut offs of
0.45 g/t Au and 2.5 g/t Au, respectively.
* Tulu Kapi is essentially a gold deposit and due to
the low unit value of silver all exploration work and
resource estimates have focused on gold and no
emphasis has been placed on the presence of, and
estimate of a silver Mineral Resource. Kefi did not
carry out an estimate of silver resources in this
resource update.
* Following grade estimation a statistical and visual
assessment of the block model was undertaken for
validation purposes. Visual comparison of composite
sample grade and block grade was conducted in cross
section and in plan. Visually the model was
considered to spatially reflect the composite grades.
Statistical analysis of the block model was carried
out for comparison against the composited drillhole
data. The mean block model grade for each domain and
its corresponding mean composite grade compared well
as did global averages. Sectional trend plots were
generated which indicate that there is a good local
reproduction of the input grades in both the
horizontal and vertical directions.
No obvious interpolation issues were identified
and there is no evidence of significant over
or under-estimation apparent in the model.
Moisture * Tonnages were estimated on a dry basis.
* Whether the tonnages are estimated on a dry basis or
with natural moisture, and the method of
determination of the moisture content.
Cut-off
parameters * The basis of the adopted cut-off grade(s) or quality * Previous mineralized zone interpretations from the
parameters applied. November2012 resource estimate by Wardell Armstrong
were based on contiguous length analyses to define
the mineralization and identify a suitable grade
boundary to separate mineralized from non-mineralized
syenite. A cut-off grade of 0.3 g/t Au had been used
in the 2012 resource estimate to define the
mineralization for both the saprolite and fresh
material. Kefi and Snowden have kept the same cut-off
grade after reviewing the grade distributions and
agreeing that there is a change in population at
around 0.3 g/t Au.
* The reporting cut-off for this 2014, Mineral Resource
is 0.45 g/t Au for open pit material (above 1400 mRL)
and 2.5 g/t Au for underground potential (below 1400
mRL) which is based on open pit optimization studies
carried out as part of reviews of the previous
definitive feasibility study works.
* Kefi have carried out reviews with independent mine
planning contractors using updated gold prices of
$1200/oz and updated costing parameters and
production rates to reflect lower gold prices than
those used in the definitive feasibility study.
Mining factors
or assumptions * Assumptions made regarding possible mining methods, * The Mineral Resource has been reported as mineable by
minimum mining dimensions and internal (or, if open pit methods above 1400 mRL which is the bottom
applicable, external) mining dilution. It is always out elevation for the pit optimization shells
necessary as part of the process of determining generated as part of review of the 2012 definitive
reasonable prospects for eventual economic extraction feasibility study.
to consider potential mining methods, but the
assumptions made regarding mining methods and
parameters when estimating Mineral Resources may not * Below 1400 mRL the Mineral Resource is reported as
always be rigorous. Where this is the case, this potentially mineable by underground methods.
should be reported with an explanation of the basis
of the mining assumptions made.
Metallurgical
factors * The basis for assumptions or predictions regarding * Metallurgical testwork was carried out to definitive
or assumptions metallurgical amenability. It is always necessary as feasibility study level during the November 2012
part of the process of determining reasonable resource period and demonstrated feasible
prospects for eventual economic extraction to metallurgical recovery for the Tulu Kapi project.
consider potential metallurgical methods, but the This information was reviewed by Kefi technical staff
assumptions regarding metallurgical treatment and confirmed to be technically and economically
processes and parameters made when reporting Mineral sound.
Resources may not always be rigorous. Where this is
the case, this should be reported with an explanation
of the basis of the metallurgical assumptions made.
Environmental
factors * Assumptions made regarding possible waste and process * A detailed Environment Impact Statement and plant and
or assumptions residue disposal options. It is always necessary as infrastructure design was carried out to definitive
part of the process of determining reasonable feasibility study level during the November 2012
prospects for eventual economic extraction to resource period and demonstrated the project to be
consider the potential environmental impacts of the environmentally sound and sustainable. This
mining and processing operation. While at this stage information was reviewed by Kefi technical staff and
the determination of potential environmental impacts, confirmed to be technically and in compliance with
particularly for a greenfields project, may not relevant environmental laws and legislation.
always be well advanced, the status of early
consideration of these potential environmental
impacts should be reported. Where these aspects have
not been considered this should be reported with an
explanation of the environmental assumptions made.
Bulk density
* Whether assumed or determined. If assumed, the basis * Kefi, after technical review, used the same
for the assumptions. If determined, the method used, procedures for density allocation within the
whether wet or dry, the frequency of the measurements saprolite and fresh zones within the block model as
, carried out by Wardell Armstrong in the November 2012
the nature, size and representativeness of the resource calculation.
samples.
* A global (dry) density value of 1.4 t/m3 was used for
* The bulk density for bulk material must have been all saprolite material. A global (dry) density value
measured by methods that adequately account for void of 2.7 t/m3 was used for all fresh material. From
spaces (vugs, porosity, etc), moisture and field measurements (over 10,000 samples) the average
differences between rock and alteration zones within density of the mafic syenite (mineralisation) is
the deposit. 2.736 t/m3 and so the use of 2.7 t/m3 is robust and
slightly conservative.
* Discuss assumptions for bulk density estimates used
in the evaluation process of the different materials. * Density values for the fresh material have been
derived from density measurements carried out by
ROCKLAB supplemented by additional density testing on
site by Nyota. The measurements represent a dry
density.
* Saprolite density has been derived from limited work
carried out by Nyota and testwork at ROCKLAB (2011).
The value of 1.4 t/m3 was considered by Wardell
Armstrong to be appropriate until a comprehensive
study of density measurements of the saprolite
material is completed.
* In 2012 Nyota submitted 56 samples of saprolite
material for analysis at Water Works and Supervision
Enterprise Laboratory Service Sub Process, Addis
Ababa, Ethiopia. The results of this testwork
recorded an average bulk density of 1.86 gm/cc and
dry density of 1.47 gm/cc. Wardell Armstrong
considered the saprolite value of 1.4 t/m3 to be
relatively low compared to other saprolite projects
and continued assessment should be practiced. Kefi
has planned to implement an ongoing assessment of
saprolite density checks
Classification
* The basis for the classification of the Mineral * Criteria for defining resource categories were
Resources into varying confidence categories. derived from a combination of the geostatistical
studies (grade continuity), interpreted structural
continuity and drillhole spacing.
* Whether appropriate account has been taken of all
relevant factors (ie relative confidence in
tonnage/grade estimations, reliability of input data, * The main central area of the deposit coincides with
confidence in continuity of geology and metal values, the greatest ore body thicknesses and also the
quality, quantity and distribution of the data). greatest continuity of mineralization. The drillhole
spacing in this area is generally on a 40 m by 40 m
grid, down to 20 m by 20 m in some areas and is
* Whether the result appropriately reflects the therefore relatively well drilled for the
Competent Person's view of the deposit. mineralization style. The nature of the geological
and grade continuity encountered within the deposit
means this area is considered to be suitable for
reporting of Indicated Mineral Resources
* In areas outside the central zone the orebody
thickness and continuity of mineralisation appear to
reduce and drillhole spacing in these areas ranges
from 40 m by 80 m up to 80 m by 80 m. The drillhole
spacing and nature of mineralization in these areas
are suitable for reporting of Inferred Mineral
Resources.
* For the central zone, search radii used during grade
estimation were also used to define classification.
Consistent areas of blocks estimated in the first and
second searches (within the variogram range) were
classified as Indicated Resources and blocks
consistently estimated in the third search pass were
classified as Inferred Resources.
* The majority of Mineral Resources contained within
the north fault block, (UNDP) are classified as
Inferred Resources, except for a portion representing
more closely spaced drilling (approximately 40 m 40
m) which was estimated in first and second search
passes.
Audits or
reviews * The results of any audits or reviews of Mineral * An independent verification of the resource model has
Resource estimates. been carried out by Snowden. Snowden's check
reporting, using the same reporting criteria,
confirms that the tonnes and grade match those in the
reported resource tabulations. Snowden has
independently validated the estimate and checked each
stage of the estimation process including review of
all parameters, macros and classification criteria.
Snowden considers that there are no material issues
with the estimate.
* A final report is expected to make a number of
technical recommendations including development of
wireframes to further refine the mineralisation
interpretation.
Discussion
of relative * Where appropriate a statement of the relative * Statistical and visual validation and checking of the
accuracy/ accuracy and confidence level in the Mineral Resource block model confirm it performs as expected globally
confidence estimate using an approach or procedure deemed and locally in plan and section within the 2014 drill
appropriate by the Competent Person. For example, the database and structural comparison with surface and
application of statistical or geostatistical trench mapping confirm mineralized zones to outcrop
procedures to quantify the relative accuracy of the where expected and be the approximate thickness as
resource within stated confidence limits, or, if such indicated by the block model.
an approach is not deemed appropriate, a qualitative
discussion of the factors that could affect the
relative accuracy and confidence of the estimate. * Model validation, the drilling grid and observation
of the grade and mineralization continuity lead Kefi
to consider the central part of the deposit suitable
* The statement should specify whether it relates to for an Indicated Resource category and peripheral
global or local estimates, and, if local, state the areas suitable for an Inferred Resource category.
relevant tonnages, which should be relevant to
technical and economic evaluation. Documentation
should include assumptions made and the procedures * The nature of the mineralization and the relatively
used. high nugget content may result in local grade
estimates being of a relatively low confidence. It is
likely that closely spaced channel sampling / bulk
* These statements of relative accuracy and confidence sampling or grade control drilling will be required
of the estimate should be compared with production for the classification of Measured Resources
data, where available.
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-Ends-
This information is provided by RNS
The company news service from the London Stock Exchange
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