TIDMBKY
RNS Number : 1376E
Berkeley Energia Limited
14 July 2016
BERKELEY ENERGIA LIMITED
NEWS RELEASE | 14 July 2016 | AIM/ASX: BKY
Study confirms the Salamanca project as one of the world's
lowest cost uranium producers
An independent Study has confirmed the Salamanca project as one
of the world's lowest cost producers capable of generating strong
after tax cash flow through the current low point in the uranium
price cycle.
A Definitive Feasibility Study has reported that over an initial
ten year period the project is capable of producing an average of
4.4 million pounds of uranium per year at a cash cost of US$13.30
per pound and at a total cash cost of US$15.06 per pound which
compares with the current spot price of US$26 per pound and term
contract price of US$41 per pound.
During this ten year steady state period, based on the most
recent UxC forward curve of uranium prices, the project is expected
to generate an average annual net profit after tax of US$116
million.
Managing Director Paul Atherley commented: "The Salamanca
project is capable of generating strong, sustainable cash flow
though the low point in the uranium price cycle. We have commenced
initial infrastructure works and are aiming to establish the
operation as one of the world's top ten producers, reliably
supplying long term customers from the heart of the European
Union."
With operating costs almost exclusively in Euros and a revenue
stream in US dollars the project is expected to continue to benefit
from the effects of deflationary pressures within the EU.
The project benefits greatly from the well-established EU funded
infrastructure in the region with an initial capital cost of only
US$95.7 million which is low by international standards for a
project of this size.
The Company is of the view that whilst uranium prices will
remain soft in the near term, from 2018, when Salamanca is
scheduled to come on line, the market is expected to be dominated
by US utilities looking to re-contract. These utilities will also
be competing with Chinese new reactor demand, which may lead to
higher prices.
The Company has recently been approached by a number of
utilities looking to secure long term offtake agreements. These
discussions are underway and offtake arrangements are being
negotiated.
The project has an initial mine life of 14 years based on mining
and treating only the Measured and Indicated resources of 59.8
million pounds.An annual exploration programme, which will take
advantage of generous taxation incentives, has been aimed at making
new discoveries and converting some of the 29.6 million pounds of
Inferred resources into the mine schedule with the objective of
maintaining annual production at over 4 million pounds a year on an
ongoing basis.
This programme has commenced with drilling underway looking to
extend the Zona 7 deposit at depth and to the south as well as
testing nearby targets to the north. Initial results are expected
to be reported shortly.
The mine design incorporates the very latest thinking on minimal
environmental impact and continuous rehabilitation such that land
used during mining and processing activities is quickly restored to
agricultural usage.
The Company has established a good neighbour and business
partner relationship with the local community. In addition to the
creation of 450 direct jobs and up to 2,000 indirect jobs in a
community hard hit by long term unemployment, the Company will
actively support the local businesses and the activities of the
local municipalities.
With approvals in place for initial infrastructure development,
work has now commenced on the road realignment and power line
upgrade ahead of the main construction.
For further information please contact:
Paul Atherley Hugo Schumann Paul Shackleton / Nick
Prowting (Nomad)
Managing Director Corporate Jay Ashfield (Broker)
Manager
+44 207 478 +44 207 478
3900 3900 WH Ireland Limited
info@berkeleyenergia.com +44 207 220 1666
Table 1 - Summary of Key Study Outputs
Definitive Feasibility Study Results
(to a maximum accuracy variation
+/- 10%)
------------------------------------------------
Net Present Value (NPV) (Post-tax US$531.9m
@ 8%)
------------------------------------ ----------
Internal Rate of Return (Post-tax) 60%
------------------------------------ ----------
Mine Life 14 years
------------------------------------ ----------
First Production 2018
------------------------------------ ----------
Annual Saleable Production 4.4 Mlb
(steady state operation) of U(3)
O(8)
------------------------------------ ----------
Annual Saleable Production 3.5 Mlb
(life of mine) of U(3)
O(8)
------------------------------------ ----------
C1 Cash Cost (steady state US$13.30
operation) /lb
------------------------------------ ----------
C1 Cash Cost (life of mine) US$15.39
/lb
------------------------------------ ----------
C2 Cash Cost (steady state US$15.06
operation) /lb
------------------------------------ ----------
C2 Cash Cost (life of mine) US$17.15
/lb
------------------------------------ ----------
Up-Front Capital US$95.7m
------------------------------------ ----------
Stripping Ratio - Life of
Mine (ore:waste) 1:1.4
------------------------------------ ----------
Peak Annual EBITDA US$226.3m
------------------------------------ ----------
Introduction
This Definitive Feasibility Study (Study) was managed by MDM
Engineering (part of the Amec Foster Wheeler group) and includes
inputs from a number of specialized contractors including major
Spanish firms OHL and Iberdrola. The study has been prepared in
accordance with the JORC Code 2012 Edition (JORC).
Table 2 - Study Contractors
Consultant Activity
---------------- ----------------------------------------------------------
MDM Engineering
(part of * Overall Study Management
the Amec
Foster Wheeler
Group) * Process Plant Design
* Infrastructure Design
* Capital and Operating Costs related to these areas
---------------- ----------------------------------------------------------
Bara Consulting Ore Reserve Estimate
---------------- ----------------------------------------------------------
* Mine Design and Scheduling
* Capital and Operating Cost related to mining
activities
* Mine dump design
* Pit backfilling design
* On mine logistics of material movement
---------------- ----------------------------------------------------------
Mintek Metallurgical Testwork
---------------- ----------------------------------------------------------
Randolph Metallurgical Testwork
Scheffel Design and Metallurgy
---------------- ----------------------------------------------------------
FRASA/INGEMISA Hydrogeology
---------------- ----------------------------------------------------------
AECOM
* Environmental Management,
* Radiological Protection
* Permitting
---------------- ----------------------------------------------------------
Iberdrola Radiological Protection
---------------- ----------------------------------------------------------
OHL Material Handling facilities
and cost estimate
---------------- ----------------------------------------------------------
March JLT Insurance Cost Estimation
---------------- ----------------------------------------------------------
The Study is based on extracting 61.3 million tonnes of ore at
an average grade of 408 ppm U(3) O(8) to produce 48.6 million
pounds of U(3) O(8) .
The Study reports on an initial mine schedule of 14 years
producing on average 3.5 million pounds of uranium per year.
After an initial ramp up, production averages 4.4 million pounds
per year during ten years of steady state operations.
Exploration will increase Mineral Resource base
The overall Mineral Resource Estimate (MRE) stands at 89.3
million pounds of U(3) O(8) .
The Study was based solely on Measured and Indicated Resources
totaling 59.8 million pounds of U(3) O(8) and did not incorporate
any Inferred Resources, which total 29.6 million pounds of U(3)
O(8) .
Potential exists to maintain steady state production by
successfully converting these Inferred Resources into Indicated
Resources with further drilling.
Table 3 - Global Mineral Resource Estimates at a cut-off grade
of 200 ppm U(3) O(8) (Only Measured and Indicated Resources
included in the DFS)
July 2016
------------------- ------------ --------------------------
Deposit Resource Tonnes U(3) U(3)
O(8) O(8)
Name Category (Mt) (ppm) (Mlbs)
------------------- ------------ ------- ------- --------
Retortillo Measured 4.1 498 4.5
Indicated 11.3 395 9.8
Inferred 0.2 368 0.2
-------------------------------- ------- ------- --------
Total 15.6 422 14.5
-------------------------------- ------- ------- --------
Zona 7 Measured 5.2 674 7.8
Indicated 10.5 761 17.6
Inferred 6.0 364 4.8
-------------------------------- ------- ------- --------
Total 21.7 631 30.2
-------------------------------- ------- ------- --------
Alameda Indicated 20.0 455 20.1
Inferred 0.7 657 1.0
-------------------------------- ------- ------- --------
Total 20.7 462 21.1
-------------------------------- ------- ------- --------
Las Carbas Inferred 0.6 443 0.6
Cristina Inferred 0.8 460 0.8
Caridad Inferred 0.4 382 0.4
Villares Inferred 0.7 672 1.1
Villares North Inferred 0.3 388 0.2
------------------- ------------ ------- ------- --------
Total Retortillo
Satellites Total 2.8 492 3.0
------------------- ------------ ------- ------- --------
Villar Inferred 5.0 446 4.9
Alameda Nth Zone
2 Inferred 1.2 472 1.3
Alameda Nth Zone
19 Inferred 1.1 492 1.2
Alameda Nth Zone
21 Inferred 1.8 531 2.1
------------------- ------------ ------- ------- --------
Total Alameda
Satellites Total 9.1 472 9.5
------------------- ------------ ------- ------- --------
Gambuta Inferred 12.7 394 11.1
------------------- ------------ ------- ------- --------
Salamanca project
Total Measured 9.3 597 12.3
===================
Indicated 41.8 516 47.5
Inferred 31.5 395 29.6
-------------------------------- ------- ------- --------
Total (*) 82.6 514 89.3
================================ ======= ======= ========
(*) All figures are rounded to reflect appropriate levels of
confidence. Apparent differences occur due to rounding. The
Measured and Indicated Mineral Resources are inclusive of those
Mineral Resources modified to produce the Ore Reserves
Ore Reserve Estimate
The project's Ore Reserve Estimate stands at 54.6 million pounds
of U(3) O(8) of which 20.6 percent is considered Proved and 79.4
percent is considered Probable after the application of all mining
factors.
Table 4 - Project Ore Reserve Estimate
July 2016
------------ ----------- --------------------------
Deposit Resource Tonnes U(3) U(3)
O(8) O(8)
Name Category (Mt) (ppm) (Mlbs)
------------ ----------- ------- ------- --------
Retortillo Proved 4.0 397 3.5
Probable 11.9 329 7.9
Total 15.9 325 11.4
------------------------ ------- ------- --------
Zona 7 Proved 6.5 542 7.8
Probable 11.9 624 16.4
------------------------ ------- ------- --------
Total 18.4 595 24.2
------------------------ ------- ------- --------
Alameda Proved 0.0 0.0 0.0
Probable 26.4 327 19.0
------------------------ ------- ------- --------
Total 26.4 327 19.0
------------------------ ------- ------- --------
Total Proved 10.5 487 11.3
============
Probable 50.3 391 43.4
Total (*) 60.7 408 54.6
======================== ======= ======= ========
(*) cut-off grade for Retortillo 107 ppm, Zona 7 125 ppm,
Alameda 90 ppm. Apparent differences occur due to rounding.
Sustainable Open Pit Mining
The mine design incorporates the latest thinking in continuous
mine rehabilitation which allows the orebodies to be mined with
minimum land disturbance and to be continuously rehabilitated. On
completion of operations the mining and treatment plant areas will
be fully restored to their original agricultural land use.
Each of the shallow and long orebodies are mined by conventional
drill, blast, excavator and truck methods opening up the orebody
from the initial mining stage and progressively lining and
backfilling with waste and treated ore, as mining progresses along
the length of the orebody.
The ore from each open pit is loaded and hauled to the ore
stockpile. The ore stockpiles at Retortillo and Alameda are at the
process plant site while the stockpile at Zona 7 is approximately
10km from the plant. The ore from the Zona 7 stockpile will be
loaded onto a two way overland conveyor which connects the site to
the process plant area at Retortillo.
Ore is continuously stacked onto an on/off heap leach pad.
Treated ore is reclaimed from the pad and transported back to the
open pit for backfilling along with mined waste or to a temporary
waste dump if there is no pit space available.
Mining operations will be carried out by a contractor with
operations based on the use of hydraulic excavators and a fleet of
haul trucks engaged in conventional open pit mining techniques.
Steady state mining during the first ten years will produce on
average 4.4 million pounds per year. It is planned to maintain this
production rate by both drilling the known Inferred Resources and
potentially converting part of this into ore for the mine schedule
and through new discoveries.
Processing
The ore will be treated by heap leaching and processed through a
conventional circuit and sold as drummed U(3) O(8) concentrate. An
important environmental benefit of backfilling the treated ore
reclaimed from the on/off heap leach pads into the mined pits, is
the removal of the requirement for a tailings storage facility.
The process flowsheet comprises crushing, screening,
agglomeration, stacking and heap leaching using on/off leach pads,
followed by uranium recovery and purification by solvent
extraction.
The conveyed ore is agglomerated, continuously stacked and
irrigated with a dilute sulphuric acid solution. The ore types have
reported impressive metallurgical recoveries averaging 88% with low
acid consumption and a short residence time.
The concentrated uranium solution from the solvent extraction
plant is treated to precipitate the uranium and calcined to produce
U(3) O(8) concentrate.
At Zona 7 only a primary crushing circuit will be required. The
crushed ore will be conveyed ten kilometres to the process plant
located at Retortillo. The secondary crushing circuit at Retortillo
will be upgraded to include a tertiary stage.
The uranium from the Alameda heap leach pregnant liquor solution
will be loaded onto resin via an ion exchange adsorption column and
the loaded resin will be transported approximately 50 kilometres by
road to the Retortillo plant for final extraction and
purification.
Analysis of the concentrate produced from the Retortillo and
Zona 7 ore (and analysis of the pregnant liquors from the Alameda
deposits) indicate that there are no impurities at levels that
could adversely impact the sale of the product.
Infrastructure
The project benefits significantly from well-established
infrastructure in the area. The project is readily accessible by
major roads and railways and is connected to the major sea port of
Santander and airports at Salamanca and Madrid.
It has major electrical power connections, plenty of water and a
strong demand for jobs in a region hit hard by unemployment.
Training courses for future employees have been oversubscribed and
enthusiastically attended.
The area has previously experienced the economic benefits of
mining having supported Spain's main uranium mining industry from
the 1970s up until the last mine closing in 2001.
The power requirements for the project are low at an estimated
at 3.3 megawatts (MW) for Retortillo, 1.7 MW at Zona 7, and 3.1 MW
at Alameda. All power will be supplied from the National
Distribution Grid at a cost of US$0.07 per kilowatt hour. The
connection will require construction of a 13 kilometre 45 kV
powerline to the Alameda deposit site in year 2.
Water will be available from adjacent water courses and on-site
sources such as pit dewatering bore holes and collection systems
designed to capture rain and surface run-off water during the wet
season.
On-site accommodation facilities are not required given the
available labour sourced from nearby villages and from the city of
Salamanca 70 kilometres away.
An on-site sulphuric acid plant is also not required as
sulphuric acid is readily available from two regional smelters at
very competitive rates.
Capital Costs
The initial capital cost of all infrastructure and indirect
costs required to develop and commence production at Retortillo has
been estimated at US$95.7 million.
The capital cost for the mine, processing facilities and
associated infrastructure for Zona 7 is US$59.2 million and will be
incurred during the first year of production.
The capital cost for the mine, processing facilities and
associated infrastructure for Alameda is estimated at US$79.7
million and will be incurred during the second year of
production.
The indirect costs include the first fill of reagents, spares,
Engineering, Procurement and Construction Management (EPCM) costs,
Preliminary and General (P&G) costs and a 6% contingency for
the proposed facilities.
Working capital, amounting to US$10.7 million, is required to
support eight months of operation after start-up at Retortillo and
has been included in the year 1 operating cost estimate.
The engineering studies supporting the capital cost estimates
for the project allow for a level of accuracy of nominally +/-
10%.
A summary of major capital costs is shown in Tables 5 to 7
below:
Table 5 - Retortillo Up-Front CAPEX
Description Cost (US$ million)
------------------------------ -------------------
Mining (pre-strip) 2.5
------------------------------ -------------------
Waste Dumps, Water
Management, etc. 7.4
------------------------------ -------------------
Processing 54.7
------------------------------ -------------------
Plant Related Infrastructure 9.8
------------------------------ -------------------
Other Capex 4.7
------------------------------ -------------------
G&A 2.3
------------------------------ -------------------
Indirect Costs 14.2
------------------------------ -------------------
TOTAL 95.7
------------------------------ -------------------
Apparent differences in totals occur due to rounding
Table 6 - Zona 7 Up-Front CAPEX
Description Cost (US$ million)
------------------------------ -------------------
Mining (pre-strip) 0.8
------------------------------ -------------------
Waste Dumps, Water
Management, etc. 5.3
------------------------------ -------------------
Processing 30.8
------------------------------ -------------------
Plant Related Infrastructure 8.1
------------------------------ -------------------
Other Capex 2.7
------------------------------ -------------------
Indirect Costs 11.4
------------------------------ -------------------
TOTAL 59.2
------------------------------ -------------------
Apparent differences in totals occur due to rounding
Table 7 - Alameda Up-Front CAPEX
Description Cost (US$ million)
------------------------------ -------------------
Mining (pre-strip) -
------------------------------ -------------------
Waste Dumps, Water
Management, etc. 6.3
------------------------------ -------------------
Processing 45.2
------------------------------ -------------------
Plant Related Infrastructure 8.0
------------------------------ -------------------
Other Capex 5.3
------------------------------ -------------------
Indirect Costs 14.9
------------------------------ -------------------
TOTAL 79.7
------------------------------ -------------------
Apparent differences in totals occur due to rounding
At Retortillo, an additional US$9.95 million of capital is
required to develop a second major pit in year 13.
Operating Costs
The average C1 steady state operating cost has been estimated at
US$13.30 per pound of U(3) O(8) produced.
The average operating cost for the life of mine is US$15.39 per
pound of U(3) O(8) produced.
The operating costs (C1 cash costs) are defined as the direct
operating costs including contract mining, processing, ripios
backfill, water treatment and G&A.
Table 8 - Summary of Life of Mine Operating Costs (nominally +/-
10% accuracy)
Description Cost (US$/lb U(3)
O(8) )
-------------------------- ----------------------------
Zona Retortillo Alameda
7
-------------------------- ----- ----------- --------
Mining 3.5 9.9 7.4
Processing (including
ripios backfill) 5.5 10.7 11.1
G&A 0.9 0.9 0.9
-------------------------- ----- ----------- --------
Subtotal by Area 9.9 21.5 19.5
========================== ===== =========== ========
Total Average Operating
Costs 15.4
========================== ============================
Apparent differences in totals occur due to rounding
The all in cash cost (excluding rehabilitation costs) over the
life of mine is US$17.15 per pound of U(3) O(8) produced and
comprises C1 cash operating costs plus marketing, transport costs,
estimated at 1.0% of the gross value of the final product (US$0.63
per pound U(3) O(8) produced), and royalties which average US$1.51
per pound U(3) O(8) produced over the life of mine.
The royalties are defined as a percentage of the net value of
the product sold (gross value less commercialisation) and include
the State Reserves Royalty (2.5%, applied only to production at
Alameda), Municipality Royalty (0.2%, applied to all project
revenues) and an Anglo Pacific and RCF Royalty (combined total of
1.375%, applied to all project revenues).
Environmental, Waste Management and Rehabilitation
The costs associated with the continuous rehabilitation programs
and closure programs include the pit preparation for backfilling,
rehandling of temporary dumps for backfill and the rehabilitation
of the surface.
The costs for the preparation of the pits for backfilling are
incurred from year 2 of operations and amount to US$6.8 million for
Retortillo, US$3.6 million for Zona 7 and US$6.6 million for
Alameda.
The cost for rehandling at the end of the mine life is US$26.1
million for Retortillo, US$26.4 million for Zona 7 and US$31.0
million for Alameda.
The cost for rehabilitation and closure is US$13.9 million at
Retortillo, US$14.0 million at Zona 7 and US$20.1 million at
Alameda.
Pit preparation for backfilling and reclamation systems have
been treated as capital costs while ripios reclamation and
backfilling have been treated as operating costs.
Community and Employment
Management has worked closely with all stakeholders, including
local communities and relevant government authorities, in all
aspects of work conducted on the project to date.
As part of these efforts, the Company has signed co-operation
agreements with each of the three local municipalities under which
the Company has committed to contribute to the economic and social
development of the community.
The workforces required for the construction and operational
phases of the project will be sourced from the local communities
whenever possible in combination with a small number of highly
skilled professionals who will be recruited from elsewhere in Spain
or abroad.
The Company has commenced skills training programs for local
employees who have been drawn from the surrounding region which has
a history of over thirty years of uranium mining operations.
Training programs completed to date include blasting techniques
and driver training for heavy equipment and were both heavily
oversubscribed by local participants.
The Company currently estimates that an ongoing workforce of
approximately 450-500 direct employees (including mining and other
permanent contractors) will be required during steady state
operations.
The University of Salamanca has estimated a multiplier effect
whereby 5.2 indirect jobs will be created for every direct job,
making the project a significant contributor to job creation in an
area suffering badly from the effects of rural desertification.
Permitting
The Company has received all the European Union, National,
Regional and Provincial level approvals required for the
commencement of initial infrastructure development of the
project.
This initial development, the realignment of the road and
upgrading the power line, is underway ahead of the main
construction.
With the Mining Licence, Environmental Licence, all approvals
from the Water Authority and Initial Authorisation for the Process
Plant in hand, the approvals required ahead of the main
construction comprise the locally issued Urbanism Licence and the
Construction Authorisation by the Ministry of Industry, Energy and
Tourism. Both of these approvals are in progress.
Sustainable cashflow generation through continuous
exploration
The current resource base comfortably supports strong cashflow
generation over the next decade. Continuous annual exploration
targeting both the conversion of existing Inferred resources into
the mine schedule and the generation of new resources will be a
major focus.
The Study did not incorporate any Inferred Mineral Resources
currently contained within the overall MRE for the project (which
comprises of an additional 29.6 million pounds U(3) O(8) ). The
Company believes substantial potential exists to both upgrade and
increase the resource base from exploration and therefore extend
the mine life at Salamanca.
Uranium Marketing Strategy
Berkeley intends to sell U(3) O(8) concentrates to large global
utility companies across the US, Asia and Europe. The Company is in
ongoing discussions with a number of major utilities regarding long
term offtake contracts and potential financing structures and
expects to conclude suitable arrangements well within the planned
development timeframe.
DFS Sales Price Assumptions
The Company has utilised the latest UxC Annual Mid Long Term
Base Price Projections for its sales price assumptions (UxC Uranium
Market Outlook report for Q2 2016). UxC is the Industry's leading
source of publications, data services, consulting on the global
nuclear fuel cycle markets.
The forward curve utilised is a projection of long term
contracted uranium prices (rather than spot prices) which is
consistent with the Company's intention to enter into long term
offtake contracts over the significant majority of its offtake.
This forward curve utilised is more conservative than analyst
consensus forecasts where long term contract prices are forecast to
rise from $43.25 per pound of U(3) O(8) in 2017 to $65 per pound
from 2022 onwards.
Table 9 - Sales Price Assumption based on UxC Annual Mid Long
Term Base Price Projections
Year 2017 2018 2019 2020 2021 2022 2023
($US ($US ($US/ ($US/ ($US/ ($US/ ($US/
/ lb) / lb) lb) lb) lb) lb) lb)
------------ -------- -------- -------- -------- -------- -------- --------
Mid-Long
Term Base 39.06 40.10 40.10 41.83 45.07 48.32 52.65
------------ -------- -------- -------- -------- -------- -------- --------
Year 2024 2025 2026 2027 2028 2029 2030
($US/ ($US/ ($US/ ($US/ ($US/ ($US/ ($US/
lb) lb) lb) lb) lb) lb) lb)
------------ -------- -------- -------- -------- -------- -------- --------
Mid-Long
Term Base 54.09 56.23 58.35 61.59 63.69 66.97 67.69
------------ -------- -------- -------- -------- -------- -------- --------
Net Present Value & Internal Rate of Return
The (ungeared) Net Present Value after tax is US$531.9 million
at an 8% discount rate (real), and the (ungeared) IRR after tax is
60%. The project is expected to exhibit levels of profitability
that would contribute value to Berkeley shareholders.
Table 10 - Project Net Present Value
Discount Rate
(Real) 8% 10%
--------------- ----------------- -----------------
NPV US$531.9 million US$464.8 million
--------------- ----------------- -----------------
NPV Sensitivity Analysis
Sensitivity of the (ungeared) NPV results to changes in the key
drivers of the DCF model are presented in the table below.
If a long term contract price of US$44 per pound U(3) O(8) is
used flat over the life of mine then the NPV is US$407.2 million
and the IRR is 60%.
Table 11 - Project NPV Sensitivity Analysis
NPV at 8% discount rate (US$
million)
-------------- -------------------------------------
Base
-10% -5% Case +5% +10%
-------------- ------ ------ ------- ----- -----
Production $431 $482 $532 $582 $632
-------------- ------ ------ ------- ----- -----
U(3) O(8)
Sales Price $431 $482 $532 $582 $632
-------------- ------ ------ ------- ----- -----
Operating
Costs $561 $547 $532 $517 $502
-------------- ------ ------ ------- ----- -----
Capital
Costs $554 $543 $532 $521 $510
-------------- ------ ------ ------- ----- -----
Appendix 1: ASX Summary of Resource Estimate and Reporting
Criteria (Updated Zona 7 Mineral Resource Estimate)
Prospect Location, Geology and Geological Interpretation
Zona 7 is the largest deposit within the Salamanca project
located in central-western Spain.
Significantly, the Zona 7 deposit is located within 10km of the
approved location of the proposed processing plant at Retortillo
(Figure 2).
Zona 7 is a vein type uranium deposit hosted in a sequence of
fine grained metasediments which are overlain by a conglomerate
unit and adjacent to a granite intrusive. The mineralised envelope
is interpreted to be sub-horizontal to shallowly dipping and occurs
from surface and to maximum depth of approximately 100m.
The style of the uranium mineralisation includes veins,
stockwork and disseminated mineralisation in joint/fracture filling
associated with brittle deformation. The uranium mineralisation
occurs both within the partially weathered zone and fresh rock.
Uraninite and coffinite are the primary uranium minerals. Secondary
uranium mineralisation is developed in 'supergene-like' tabular
zones corresponding to the depth of weathering
Drilling and Sampling Techniques
The Mineral Resource Estimate (MRE) is based on data obtained
from three phases of drilling (historical 1960's to 1980's,
2007-2008, 2013-2016) totalling 428 holes for 27,475m. The drilling
comprised 103 diamond holes (DD) and 325 reverse circulation (RC)
holes (Table 12).
The majority of drilling conducted by Berkeley prior to 2016 was
undertaken on a 100m by 100m grid, with section lines orientated
approximately northwest-southeast across the interpreted strike of
the mineralisation. The 2015-2016 infill drilling campaign closed
the spacing in Domain 6 to a 50m x 50m and 35m x 35m grid, in order
to improve confidence in this part of the MRE (Figure 4). Some of
the historical drilling was completed on a closer spaced 35m x 35m
grid in Domains 2, 3 and 4. The majority of the drill holes are
vertical.
The drill hole collar locations were surveyed by qualified
surveyors using standard DGPS equipment achieving sub decimetre
accuracy in horizontal and vertical position. Down-hole surveys
were undertaken using a Geovista down-hole deviation probe.
Measurements were taken every 1cm down hole and averaged every 10m.
All DD and RC drill samples were geologically logged, with all
relevant data being recorded. Diamond core was also geotechnically
logged. Core boxes and samples and RC samples and chip trays were
photographed for future reference.
Diamond core was quarter or half cut and sampled on 0.20-1.00m
intervals. RC samples were collected over 1m intervals and split in
the field using two riffle splitters in cascade or a cone and
quarter method to provide an approximately 3-5kg sample. Samples
were further split in the core shed using a scoop to generate
0.7-1kg samples which were sent to external laboratories for
preparation and analysis. Quality assurance procedures were
employed, including the use of standards, blanks and
duplicates.
Down-hole gamma logging was undertaken for all probe accessible
holes drilled by Berkeley to provide a gamma equivalent U(3) O(8)
(eU(3) O(8) ) grade. The down-hole gamma response was converted to
eU(3) O(8) after correcting for radon, hole diameter, air/water and
application of a deconvolution filter. eU(3) O(8) data was only
used in the MRE when chemical assay data was not available.
Bulk density values were derived from 800 solid--fluid
pycnometer measurements. In situ dry bulk densities were applied to
all blocks in the resource model based on the degree of
weathering.
Table 12: Summary of drill holes used in the MRE update
Drill Pre-2007 2007-2008 2013-2016 Total
Type
-------------- --------------- --------------- --------------- ---------------------
Holes Metres Holes Metres Holes Metres Holes Metres %
-------------- ------ ------- ------ ------- ------ ------- ------ ------- ----
Reverse
Circulation - - 66 3,579 259 17,639 325 21,218 77
-------------- ------ ------- ------ ------- ------ ------- ------ ------- ----
Diamond
Core 72 4,024 9 661 22 1,571 103 6,257 23
-------------- ------ ------- ------ ------- ------ ------- ------ ------- ----
Total 72 4,024 75 4,240 281 19,210 428 27,475 100
-------------- ------ ------- ------ ------- ------ ------- ------ ------- ----
Sample Analysis Methods
Sample preparation of all drill samples involved oven drying,
crushing and pulverising to achieve a grind size of 85% passing
75<MU>m. Sample pulps from the drilling program were analysed
for uranium using either of the Delayed Neutron Counting (DNC) or
pressed powder X-ray fluorescence (XRF) methods. Historical
drilling samples were analysed for uranium using the XRF, atomic
absorption spectroscopy (AAS) or fluorometric methods.
Resource Model
Surpac and Isatis software was used for geological modelling,
block modelling, grade estimation, MRE classification and
reporting. Sectional geological interpretations were joined to
create a series of 3D mineralised wireframe domains (Figure 5) that
showed continuity above a grade of 100 ppm U(3) O(8) . Statistical
analysis and geostatistical variogram modelling was used to
determine appropriate parameters for estimation of uranium grade
using Ordinary Kriging (OK) and Localised Uniform Conditioning
(LUC).
The resource model for Domains 5 and 6 (>88% of the Zona 7
MRE) has been updated with the 2015-2016 infill drilling, and the
upgrades to these Domains are the subject of this release. As a
result of the closer spaced infill drilling, improvements in sample
support, geological continuity and variography, Domain 6 was
determined to be suitable for the application of LUC. LUC provides
a simulation of the expected grade and tonnage selectivity at the
Feasibility Study Selective Mining Unit (SMU) dimensions.
Grade Estimate
The uranium grade was estimated into a 25m by 25m x 6m panel
using OK for all domains followed by the application of LUC to
simulate the grade tonnage distribution based on SMU dimensions of
5m x 5m x 6m for Domain 6 only. Domain 5 was updated using OK. All
other domains (2, 3 and 4) were unchanged from the November 2014 OK
estimate (Figures 6 and 7).
Variography was used to derive appropriate orientation and
weighting factors employed by the OK and LUC algorithms. Suitable
sample search distances, minimum and maximum sample numbers
required to make a grade estimate and search ellipse anisotropy to
honour the mineralisation trends were derived. These parameters
were selected to ensure that the resource model honours both the
global and local grade distribution of the uranium
mineralisation.
Cut-off Grades
The MRE has been reported using a cut-off grade of 200 ppm U(3)
O(8) , which is consistent with the grade used to report previous
MRE's for this style of mineralisation.
Mining and Metallurgical methods and parameters
Based on the results of metallurgical testwork carried out on
representative samples from the Zona 7 deposit and the shallowness
of the deposit, recent mine planning work has shown that the Zona 7
MRE can potentially be extracted using open pit mining methods,
with the recovery of uranium through the application of acid heap
leach methods.
Bulk density values were unchanged for Domains 5 and 6 after
review with a 50% increase in bulk density data. In-situ dry bulk
densities were applied to all Domain 5 and 6 blocks in the resource
model based on the degree of weathering as follows: 2.28 t/m(3) for
completely weathered material; 2.40 t/m(3) for partially weathered
material; and 2.64 t/m(3) for fresh rock. Note that both the bulk
density and MRE are unchanged for Domains 2, 3 and 4 which were
unaffected by the 2015 drilling program.
Validation of the models included visual inspection of the grade
distribution compared to the drill hole data, comparison of block
model and drill hole statistics and creation and assessment of
swath plots. Overall the grade estimate showed a good
representation of the drill hole data for the resource.
Mineral Resource Estimate and Classification Criteria
The MRE for Zona 7 Domains 5 and 6 has been updated,
incorporating additional drilling and sampling information from the
2015-2016 drilling campaign.
The MRE has been classified and is reported as Measured,
Indicated and Inferred based on guidelines recommended in the JORC
Code (2012). The reported MRE has been classified with
consideration of the quality and reliability of the raw data, the
confidence of the geological interpretation, the number, spacing
and orientation of intercepts through the mineralised zones, and
knowledge of grade continuity gained from observations and
geostatistical analysis. There is adequate mining, metallurgy and
processing knowledge from feasibility studies to imply reasonable
prospects for eventual economic extraction.
The MRE is reported at a cut-off grade of 200 ppm U(3) O(8)
(Table 13), along with estimates showing the range of U(3) O(8)
cut-off grades that would span the range applicable to open pit
mining (Table 14).
Zona 7 - Mineral Resource Estimate - July
2016
Reported at a cut-off grade of 200 ppm
U(3) O(8)
---------------------------------------------------
Resource Tonnage Grade Contained
U(3) O(8)
Category (million (U(3) O(8) (million
tonnes) ppm) pounds)
-------------- --------- ----------- -----------
Measured 5.2 674 7.8
-------------- --------- ----------- -----------
Indicated 10.5 761 17.6
-------------- --------- ----------- -----------
Measured and
Indicated 15.7 735 25.4
-------------- --------- ----------- -----------
Inferred 6.0 364 4.8
-------------- --------- ----------- -----------
Total 21.7 631 30.2
-------------- --------- ----------- -----------
All figures are rounded to reflect appropriate levels of
confidence. Apparent differences occur due to rounding.
Table 14: Zona 7 - Grade Tonnage Table
Zona 7 - Mineral Resource Estimate - July
2016
---------------------------------------------------
Lower Cut-off Tonnage Grade Contained
Grade U(3) O(8)
(U(3) O(8) (million (U(3) O(8) (million
ppm) tonnes) ppm) pounds)
-------------- --------- ----------- -----------
100 36.8 431 35.0
-------------- --------- ----------- -----------
200 21.7 631 30.2
-------------- --------- ----------- -----------
300 14.6 818 26.4
-------------- --------- ----------- -----------
400 10.6 996 23.4
-------------- --------- ----------- -----------
500 8.1 1,164 20.9
-------------- --------- ----------- -----------
Appendix 2: Summary of RC Drill Intersections - Zona 7 (200 ppm
U(3) O(8) cut-off)
Drill Easting Northing Elevation Azimuth Dip Depth From To Interval U(3)
Hole O(8)
ID ppm
--------- ------ -------
(m) (m) (m) ((o) ((o) (m) (m) (m) (m)
) )
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-249 713962 4527225 759 360 -90 60 23 28 5 893
incl. 23 24 1 2,948
33 34 1 265
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-250 714012 4527399 755 360 -90 69 12 17 5 265
35 38 3 391
42 44 2 502
63 64 1 331
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-251 713902 4527204 759 360 -90 60 25 26 1 694
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-252 714017 4527396 755 360 -90 78 15 32 17 1,146
incl. 18 19 1 1,450
incl. 24 31 7 1,840
35 36 1 397
43 46 3 477
50 51 1 296
58 59 1 222
67 70 3 925
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-253 713925 4527248 758 360 -90 60 6 7 1 347
18 20 2 293
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-254 714023 4527394 756 360 -90 65 17 30 13 701
incl. 28 30 2 1,221
47 50 3 557
incl. 47 48 1 1,214
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-255 713813 4527250 761 360 -90 60 22 23 1 740
29 34 5 794
incl. 30 33 3 1,128
43 44 1 226
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-256 714031 4527397 756 360 -90 71 10 32 22 644
incl. 12 14 2 1,049
incl. 23 25 2 1,194
incl. 30 31 1 1,071
45 46 1 531
65 66 1 1,580
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-257 713836 4527294 760 360 -90 60 24 32 8 645
incl. 24 25 1 1,710
incl. 28 29 1 1,203
37 40 3 573
incl. 39 40 1 1,256
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-258 714034 4527388 757 360 -90 65 12 17 5 317
21 22 1 228
30 31 1 713
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-259 713853 4527232 760 360 -90 60 17 18 1 297
44 45 1 212
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-260 714039 4527386 758 360 -90 65 12 22 10 369
32 33 1 909
36 37 1 242
47 48 1 210
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-261 713881 4527271 758 360 -90 60 31 32 1 210
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-262 714010 4527352 757 360 -90 77 6 7 1 252
12 21 9 1,873
incl. 17 18 1 11,908
incl. 20 21 1 2,676
24 26 2 906
incl. 24 25 1 1,556
29 40 11 1,245
incl. 32 33 1 8,984
incl. 36 37 1 1,491
44 48 4 1,346
incl. 44 45 1 2,995
incl. 47 48 1 2,234
54 55 1 469
58 59 1 323
65 66 1 217
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-263 713899 4527318 758 360 -90 66 15 20 5 2,309
23 28 5 1,388
31 37 6 325
40 44 4 422
49 50 1 275
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-264 714013 4527357 757 360 -90 69 9 10 1 246
22 28 6 1,185
incl. 22 23 1 1,798
incl. 27 28 1 4,622
31 33 2 1,984
37 43 6 413
48 52 4 250
64 66 2 353
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-265 713856 4527339 759 360 -90 64 25 39 14 1,950
48 54 6 534
incl. 52 53 1 1,975
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-266 714015 4527363 757 360 -90 64 18 22 4 245
26 33 7 1,168
incl. 28 30 2 2,815
46 47 1 3,985
52 61 9 311
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-267 713883 4527383 757 360 -90 65 10 42 32 519
incl. 12 14 2 1,981
incl. 16 17 1 1,139
incl. 21 22 1 1,092
incl. 39 40 1 1,220
46 52 6 420
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-268 714018 4527369 757 360 -90 68 24 30 6 725
incl. 26 27 1 2,735
34 38 4 1,349
incl. 34 36 2 2,226
51 52 1 253
56 62 6 248
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-269 714020 4527537 752 360 -90 70 15 21 6 837
25 36 11 606
43 46 3 505
51 52 1 384
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-270 714021 4527374 757 360 -90 93 8 14 6 210
19 24 5 308
27 33 6 587
incl. 29 30 1 1,226
36 48 12 336
54 62 8 251
67 89 22 847
incl. 78 81 3 1,528
incl. 83 89 6 1,596
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-272 714023 4527380 757 360 -90 83 8 9 1 310
14 30 16 457
incl. 23 24 1 1,397
33 37 4 381
43 45 2 645
51 79 28 441
incl. 67 68 1 1,041
incl. 77 78 1 2,452
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-273 713997 4527493 753 360 -90 64 11 51 40 829
incl. 18 20 2 1,163
incl. 26 27 1 1,692
incl. 29 34 5 1,912
incl. 39 45 6 1,254
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-274 714026 4527386 756 360 -90 65 18 37 19 495
incl. 29 31 2 1,495
incl. 33 34 1 1,450
42 48 6 1,365
incl. 45 48 3 2,391
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-275 714042 4527471 754 360 -90 65 19 39 20 1,160
incl. 29 30 1 1,993
incl. 32 33 1 13,676
46 50 4 433
incl. 46 47 1 1,267
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-276 713995 4527381 755 360 -90 84 13 14 1 210
26 36 10 613
incl. 30 31 1 1,645
incl. 34 35 1 1,279
41 42 1 448
50 54 4 302
63 65 2 468
68 70 2 524
75 78 3 264
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-277 714065 4527514 755 360 -90 70 25 26 1 290
28 29 1 276
35 36 1 252
43 51 8 668
incl. 44 46 2 1,587
60 61 1 777
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-278 713971 4527337 756 360 -90 65 16 23 7 1,459
incl. 16 19 3 2,441
28 46 18 580
incl. 28 29 1 2,617
incl. 42 46 4 1,223
59 60 1 5,506
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-279 714109 4527490 757 360 -90 70 26 33 7 559
incl. 31 32 1 1,609
46 52 6 2,495
incl. 47 49 2 6,691
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-280 713954 4527293 757 360 -90 66 15 25 10 275
29 46 17 1,208
incl. 29 34 5 2,730
incl. 39 40 1 1,810
incl. 42 43 1 1,769
52 53 1 343
58 59 1 322
62 63 1 246
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-281 714086 4527441 759 360 -90 70 13 23 10 697
incl. 15 18 3 1,021
incl. 22 23 1 1,362
26 30 4 220
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-282 714016 4527313 759 360 -90 65 6 7 1 202
16 17 1 291
21 34 13 2,235
incl. 22 24 2 4,032
incl. 27 31 4 4,551
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-283 714016 4527430 754 360 -90 70 39 40 1 222
48 49 1 203
64 65 1 1,129
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-285 713929 4527472 754 360 -90 70 16 23 7 346
28 51 23 1,322
incl. 30 36 6 1,854
incl. 45 50 5 2,664
55 56 1 212
62 63 1 422
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-286 714039 4527357 760 360 -90 75 14 15 1 284
20 71 51 1,045
incl. 39 40 1 1,468
incl. 43 44 1 1,415
incl. 47 48 1 2,665
incl. 51 57 6 2,241
incl. 59 65 6 3,739
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-287 713953 4527516 753 360 -90 65 21 33 12 704
incl. 22 25 3 1,424
40 49 9 1,029
incl. 40 43 3 2,286
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-288 714087 4527335 768 360 -90 70 43 44 1 253
55 56 1 208
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-289 713952 4527402 756 360 -90 70 18 19 1 204
28 35 7 336
49 50 1 514
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-290 714049 4527323 763 360 -90 75 22 38 16 1,906
incl. 26 30 4 5,671
incl. 35 37 2 1,963
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-292 714060 4527290 765 360 -90 64 18 26 8 260
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-293 713906 4527427 756 360 -90 79 30 33 3 241
38 51 13 1,028
incl. 40 41 1 1,845
incl. 43 44 1 4,516
incl. 49 50 1 2,841
56 57 1 663
62 63 1 324
69 72 3 791
incl. 70 71 1 1,845
75 76 1 323
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-294 714033 4527238 763 360 -90 60 17 27 10 2,139
incl. 21 27 6 3,344
43 44 1 1,539
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-295 713927 4527368 757 360 -90 65 16 19 3 298
22 24 2 280
35 47 12 863
incl. 38 39 1 1,262
incl. 42 44 2 2,559
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-296 714092 4527223 769 360 -90 60 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-297 713885 4527493 755 360 -90 70 16 37 21 1,324
incl. 25 32 7 2,620
incl. 34 37 3 1,832
43 46 3 274
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-298 714056 4527179 764 360 -90 60 43 44 1 258
48 49 1 1,833
52 53 1 389
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-299 713815 4527362 761 360 -90 60 22 35 13 616
incl. 22 23 1 1,048
incl. 25 26 1 1,040
incl. 32 35 3 1,169
40 51 11 1,329
incl. 40 43 3 1,219
incl. 47 50 3 3,241
57 58 1 551
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-300 714044 4527210 764 360 -90 63 21 22 1 222
27 37 10 1,969
incl. 27 36 9 2,149
46 49 3 1,016
incl. 46 48 2 1,406
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-301 713839 4527406 759 360 -90 65 20 21 1 302
27 30 3 711
37 42 5 286
52 57 5 281
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-302 714013 4527201 761 360 -90 60 16 18 2 350
22 27 5 923
incl. 24 25 1 2,499
31 36 5 1,521
incl. 34 35 1 5,789
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-303 713862 4527451 757 360 -90 70 14 27 13 1,217
incl. 18 20 2 2,243
incl. 22 24 2 3,932
31 35 4 741
incl. 34 35 1 2,105
41 43 2 1,778
incl. 41 42 1 3,337
48 51 3 898
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-304 713992 4527269 759 360 -90 60 16 21 5 2,740
24 29 5 993
incl. 24 25 1 2,948
37 41 4 1,760
incl. 37 38 1 3,207
incl. 40 41 1 3,690
44 45 1 619
52 56 4 204
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-305 713772 4527385 760 360 -90 61 15 17 2 445
31 33 2 322
37 43 6 424
46 49 3 274
52 54 2 506
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-306 714129 4527423 767 360 -90 70 60 61 1 266
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-307 713794 4527430 758 360 -90 65 32 33 1 200
44 50 6 357
58 59 1 415
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-309 713818 4527474 756 360 -90 82 31 37 6 430
40 43 3 223
54 55 1 345
73 77 4 383
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-310 714062 4527398 759 360 -90 73 20 22 2 208
30 34 4 457
42 44 2 336
52 56 4 1,207
66 69 3 1,191
--------- -------- --------- ---------- -------- ----- ------
No Significant
Z7R-311 713804 4527508 754 360 -90 70 Intercepts
-------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-312 714107 4527378 769 360 -90 70 52 53 1 322
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-313 713769 4527274 763 360 -90 64 21 23 2 982
incl. 21 22 1 1,350
45 47 2 496
50 53 3 934
incl. 52 53 1 1,539
56 58 2 636
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-314 714151 4527355 773 360 -90 56 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-315 713783 4527317 762 360 -90 60 42 47 5 275
52 53 1 353
56 57 1 325
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-316 714128 4527311 772 360 -90 70 Intercepts
-------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-317 713748 4527341 762 360 -90 60 40 53 13 256
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-318 713759 4527452 757 360 -90 65 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
No Significant
Z7R-319 713760 4527421 758 360 -90 65 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
No Significant
Z7R-320 714104 4527266 770 360 -90 65 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-321 713722 4527328 763 360 -90 67 58 62 4 498
incl. 61 62 1 1,046
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-322 714110 4527188 769 360 -90 60 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
No Significant
Z7R-323 713702 4527363 760 360 -90 60 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-324 714034 4527134 763 360 -90 67 19 21 2 290
47 48 1 236
52 56 4 444
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-325 713728 4527402 758 360 -90 60 44 45 1 235
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-326 714066 4527066 765 360 -90 60 30 31 1 278
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-327 714011 4527089 762 360 -90 60 18 23 5 386
26 37 11 202
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-328 714088 4527107 766 360 -90 60 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-329 713968 4527112 761 360 -90 60 28 43 15 1,288
incl. 29 32 3 5,599
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-330 714110 4527153 768 360 -90 65 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-331 714022 4527056 764 360 -90 60 27 28 1 241
30 31 1 284
34 38 4 294
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-332 713923 4527136 761 360 -90 60 33 34 1 238
36 37 1 208
40 41 1 277
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-333 713977 4527079 763 360 -90 60 22 36 14 1,167
incl. 28 29 1 9,585
incl. 34 35 1 2,629
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-334 713933 4527102 762 360 -90 60 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
No Significant
Z7R-335 714018 4527034 765 360 -90 60 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-336 713945 4527176 760 360 -90 60 32 33 1 239
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
No Significant
Z7R-337 713995 4527045 764 360 -90 60 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
No Significant
Z7R-338 714153 4527467 761 360 -90 70 Intercepts
--------- -------- --------- ---------- -------- ----- ------ ---------------------------------------
Z7R-339 713951 4527067 763 360 -90 60 25 31 6 437
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-340 714105 4527623 755 360 -90 83 9 28 19 1,147
incl. 11 16 5 2,155
incl. 20 22 2 2,420
31 32 1 611
46 47 1 246
57 66 9 348
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-341 713989 4527149 760 360 -90 60 10 13 3 211
21 25 4 1,432
32 33 1 244
35 36 1 208
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-342 714153 4527566 762 360 -90 80 36 37 1 289
44 56 12 1,022
incl. 47 48 1 2,948
60 73 13 282
78 79 1 281
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-343 714170 4527774 752 360 -90 60 2 23 21 1,471
incl. 7 12 5 4,552
32 33 1 249
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-344 714138 4527756 753 360 -90 80 6 11 5 388
14 20 6 1,641
incl. 18 19 1 7,911
26 34 8 1,125
incl. 26 30 4 1,429
incl. 33 34 1 1,556
39 46 7 271
50 62 12 526
incl. 52 55 3 1,348
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-345 714169 4527704 755 360 -90 85 14 30 16 497
incl. 14 17 3 1,141
34 43 9 529
incl. 34 35 1 2,158
58 62 4 274
73 74 1 2,523
79 80 1 371
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-349 714224 4527607 758 257 -60 82 38 39 1 250
76 78 2 487
81 82 1 202
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-350 714172 4527628 756 209 -60 74 27 28 1 204
48 55 7 245
67 73 6 412
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-351 714128 4527638 754 171 -60 78 36 37 1 367
32 33 1 341
42 60 18 266
63 67 4 316
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-352 714095 4527641 753 170 -60 80 40 41 1 217
77 79 2 295
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-353 714051 4527665 752 166 -60 85 50 53 3 251
72 75 3 256
78 79 1 210
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-354 713936 4527620 749 214 -60 73 7 9 2 506
16 26 10 619
incl. 18 19 1 1,763
incl. 22 23 1 1,710
32 33 1 523
46 47 1 248
56 57 1 222
60 61 1 210
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Z7R-355 713978 4527686 749 360 -90 50 11 12 1 282
--------- -------- --------- ---------- -------- ----- ------ ------ ----- ---- --------- -------
Appendix 3: ASX Summary of Ore Reserve Estimate and Reporting
Criteria
The DFS, Ore Reserve Estimate, Production Targets, and forecast
financial information derived from the DFS, Ore Reserve Estimate
and Production Target contained in this announcement, are based on
the material assumptions contained within this announcement which
are summarized below:
Table 15 - Material Assumptions
Table of Material Assumptions Underpinning
the Study
-------------------------------------------------------
Maximum Accuracy variation +/- 10%
----------------------------- ------------------------
Mine Life 14 years
----------------------------- ------------------------
Mining Method Open-pit & transfer
mining
----------------------------- ------------------------
Strip Ratio (life
of mine average) 1:1.4
----------------------------- ------------------------
Mining Cut-off Grades 107 ppm U(3)
O(8) for Retortillo,
125 ppm U(3)
O(8) for Zona
7 and 90 ppm
U(3) O(8) for
Alameda
----------------------------- ------------------------
Overall Pit Wall Slope 34-61 degrees
Angles for Retortillo,
47-59 degrees
for Zona 7,
and 34-59 degrees
for Alameda
----------------------------- ------------------------
Processing Method Heap leaching
using on-off
leach pads,
followed by
uranium recovery
and purification
by solvent extraction,
ammonium diuranate
precipitation
and calcination
----------------------------- ------------------------
Annual Ore Processing 2.7 Mtpa for
Rate (steady state) Retortillo and
Zona 7 / 3.4
Mtpa for Alameda
----------------------------- ------------------------
Annual U(3) O(8) Production 4.4 Mtpa
(steady state)
----------------------------- ------------------------
Metallurgical Recovery 88%
----------------------------- ------------------------
Sulphuric Acid Price EUR70 per tonne
----------------------------- ------------------------
Acid Consumption 18 kg/t for
Retortillo,
20 kg/t Alameda,
and 10 kg/t
for Zona 7
----------------------------- ------------------------
Mining Costs US$9.90/lb for
Retortillo
US$3.50/lb
for Zona 7
US$7.40 for
Alameda
----------------------------- ------------------------
Processing Costs US$10.70/lb
for Retortillo
US$5.50/lb
for Zona 7
US$11.10 for
Alameda
----------------------------- ------------------------
G&A Costs US$0.90/lb for
Retortillo
US$0.90/lb
for Zona 7
US$0.90 for
Alameda
----------------------------- ------------------------
Initial Capital Costs US$95.7 million
(Retortillo)
----------------------------- ------------------------
Initial Capital Costs US$59.2 million
(Zona 7)
----------------------------- ------------------------
Initial Capital Costs US$79.7 million
(Almeda)
----------------------------- ------------------------
Commercialisation
Costs 1.00%
----------------------------- ------------------------
State Reserves Royalty
- ENUSA (Alameda) 2.50%
----------------------------- ------------------------
Municipality Royalty 0.20%
----------------------------- ------------------------
Anglo Pacific Royalty 1.00%
----------------------------- ------------------------
RCF Royalty 0.38%
----------------------------- ------------------------
Corporate Tax Rate 25%
----------------------------- ------------------------
Exchange Rate USD
/ EUR 1.11
----------------------------- ------------------------
Exchange Rate GBP
/ EUR 0.75
----------------------------- ------------------------
Uranium Sales Price US$39-US$68/lb
(2017 - 2030)
----------------------------- ------------------------
Discount Rate 8%
----------------------------- ------------------------
Mtpa = Million tonnes per annum
Mlbs = Million pounds of U(3) O(8)
Introduction
The Salamanca project is made up of three distinct deposits
which will be mined independently of each other, namely:
-- Retortillo (including the Santidad satellite deposit);
-- Zona 7; and
-- Alameda.
Retortillo and Zona 7 will be mined sequentially with ore being
processed in a common processing facility while Alameda will be
mined in parallel with the other sites. Processing of the Alameda
ore will initially take place on-site, with loaded resin then
transported 50km by road to the Retortillo plant for final
processing.
Bara Consulting (Pty) Ltd. (Bara) has been commissioned by
Berkeley (the Company) to provide a JORC compliant Ore Reserve
Estimate for the Salamanca project based on all information
available as of 13 July 2016. Bara's independence is ensured by the
fact that we are a private employee owned company.
Bara has classified the reserves given in this report in
accordance with the 2012 edition of the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves (the "JORC Code").
The generation of the Ore Reserve Estimate is the culmination of
work by Bara and other parties. Bara has reviewed the input by
others and considers that the information provided is complete and
supports the declaration of Ore Reserves, we have no reason to
believe that any material facts have been withheld.
This report includes technical information, which requires
subsequent calculations to derive subtotals, totals and weighted
averages. Such calculations may involve a degree of rounding and
consequently introduce an error. Where such errors occur, Bara does
not consider these to be material.
Mining method and assumptions
All of the deposits being considered are shallow (ranging
between 0m to 160m depth below surface) and massive. Due to the
depth and geometry of the deposit, the selected mining method is
conventional drill blast truck and shovel open pit mining. Strip
ratios will vary per deposit as follows:
-- Retortillo: 2.47 tonnes of waste per tonne of ore
-- Santidad: 1.36 tonnes of waste per tonne of ore
-- Zona 7: 1.13 tonnes of waste per tonne of ore
-- Alameda: 1.08 tonnes of waste per tonne of ore
Some of the pre-strip material will be used as construction
material. Access to the pit will be by conventional open pit ramps,
25m in width that enables access for 100 tonne trucks.
Metallurgical test work has demonstrated that the mineralised
material at all the deposits is amenable to a heap leaching process
for the extraction of the uranium. Following heap leaching the
pregnant solution will undergo ion exchange, solvent extraction and
precipitation of ADU.
All treated/spent ore will be deposited back into the mined
voids along with all other mined waste material.
Ore Reserve Estimate classification criteria
The classification of the Mineral Resource Estimate was
completed by Mr. M Titley, a competent person, based on the
guidelines specified in the 2012 Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves (The JORC
Code, 2012 Edition).
Resource estimates were classified with consideration of the
following criteria:
-- Quality and reliability of raw data (sampling, assaying,
surveying).
-- Confidence in the geological interpretation.
-- Number, spacing and orientation of intercepts through
mineralised zones.
-- Knowledge of grade continuities gained from observations and
geostatistical analyses.
-- The potential prospect for eventual economic extraction.
For the Retortillo and Zona 7 Resource estimations, grade was
estimated into large panels (20m x 20m x 6m and 25m x 25m x 6m
respectively) with ISATIS software using Ordinary Kriging (OK) to
estimate in-situ resources, and Uniform Conditioning (UC) to
estimate recoverable resources at the dimensions of the SMU (5m x
5m x 6m).
A post-processing step called Localised Uniform Conditioning
(LUC) was applied. This involves reconstituting the grade-tonnage
of the panel model into the constituent SMU's of that panel - in
this case, each panel has 16 SMU's that make up the panel. The
grade-tonnage curve of the 16 SMU's in each panel is designed to
match the grade-tonnage curve of the panel.
The Alameda model was estimated using ordinary kriging and
Inverse Distance Squared (ID2) methods on a regular block size of
10m x 10m x 6m.
The Retortillo deposits extend from surface to depths of up to
90m, in plan view the deposit is divided in two orebodies: at the
northwest Santidad and to the southeast Retortillo. Retortillo
orebody covers an area of approximately 3km by 0.4km the northern
part, Santidad, is narrower covering an area of approximately 3km
by 0.2km. At 100ppm cut-off grade, the combined resource totals
36.6Mt at 259ppm U(3) O(8) for 20.9Mlbs U(3) O(8) , with 27% of the
resource currently in the Measured Category and 72% in the
Indicated Category. The remaining resource is classified as
Inferred.
The Zona 7 deposit has a lateral unfolded extension of 3km at a
width of 0.4km, thinning out towards the north. At 100ppm cut-off
grade, the Zona 7 resource totals 36.8Mt at 431ppm U(3) O(8) for
35.0Mlbs U(3) O(8) , with 24% in the Measured Category and 55% of
the resource in the Indicated Category. The remaining resource is
classified as Inferred.
The Alameda deposit extends from surface to depths of up to
180m. The mineralised body is controlled through a central
brecciated fault and perpendicularly oriented folded stratigraphy,
covering an area of 2km by 1.2 km. At 100ppm cut-off grade, the
Alameda resource totals 34.0Mt at 339ppm U(3) O(8) for 25.4Mlbs
U(3) O(8) , with 0% of the resource in the Measured Category and
95% of the resource in the Indicated Category. The remaining
resource is classified as Inferred.
The Mineral Resources for the Salamanca project, at a 100ppm
U(3) O(8) cut-off grade, is 107.4Mt at 343ppm U(3) O(8) , with 17%
in the Measured Category, 72% in the Indicated Category and 11% in
the Inferred Category.
Table 16 summarise the resources declared for each of the
deposits at a 100ppm cut-off grade.
Table 16: Salamanca Mineral Resources at 100ppm
Deposit Resource Tonnes U(3) U(3) U(3) Category
O(8) O(8) O(8)
Name Category (Mt) (ppm) (t) (Mlbs) (%)
------------- ----------- ------- ------ ------- ------- ---------
Retortillo
(including
Santidad) Measured 7.6 332 2,539 5.6 27%
------------- ----------- ------- ------ ------- ------- ---------
Indicated 28.5 240 6,839 15.1 72%
------------------------- ------- ------ ------- ------- ---------
Inferred 0.5 231 115 0.3 1%
------------------------- ------- ------ ------- ------- ---------
Total 36.6 259 9,493 20.9 100%
------------------------- ------- ------ ------- ------- ---------
Zona
7 Measured 7.5 514 3,862 8.5 24%
------------- ----------- ------- ------ ------- ------- ---------
Indicated 15.4 563 8,691 19.2 55%
------------------------- ------- ------ ------- ------- ---------
Inferred 13.9 239 3,319 7.3 21%
------------------------- ------- ------ ------- ------- ---------
Total 36.8 431 15,872 35.0 100%
------------------------- ------- ------ ------- ------- ---------
Alameda Measured 0.0 0 0 0.0 0%
------------- ----------- ------- ------ ------- ------- ---------
Indicated 32.8 335 11,003 24.3 95%
------------------------- ------- ------ ------- ------- ---------
Inferred 1.2 464 535 1.2 5%
------------------------- ------- ------ ------- ------- ---------
Total 34.0 339 11,537 25.4 100%
------------------------- ------- ------ ------- ------- ---------
Salamanca
project Measured 15.2 422 6,401 14.1 17%
------------- ----------- ------- ------ ------- ------- ---------
Indicated 76.7 346 26,533 58.5 72%
------------------------- ------- ------ ------- ------- ---------
Inferred 15.6 255 3,968 8.7 11%
------------------------- ------- ------ ------- ------- ---------
Total 107.4 343 36,902 81.4 100%
------------------------- ------- ------ ------- ------- ---------
All resources are reported using a 100ppm
U(3) O(8) cutoff grade, differences due
to rounding
------------------------------------------------------------------------
In order to determine the Mineral Resources that would be
considered for inclusion into the mining plan a pay limit grade
calculation was undertaken. Based on the outcome of the pay limit
grade calculation a mining cut-off grade was selected which was
above the pay limit. The pay limit grade calculation was undertaken
for a range of U(3) O(8) pricing scenarios ranging from US$44/lb to
US$65/lb. The pay limit grade calculation is shown in Table 17 at a
selling price of US$65/lb of U(3) O(8) .
Table 17: Pay Limit Grade Calculation
Item Retortillo/ Zona Alameda Unit
Santidad 7
--------------------- ------------ ------- -------- --------
Revenue
--------------------- ------------ ------- -------- --------
Selling price
(USD/lb U(3) O(8)
) $65.00 $65.00 $65.00 USD/lb
--------------------- ------------ ------- -------- --------
Exchange rate
(USD/EUR) 1.11 1.11 1.11 USD/EUR
--------------------- ------------ ------- -------- --------
U(3) O(8) (EUR/lb) 58.50 58.50 58.50 EUR/lb
--------------------- ------------ ------- -------- --------
U(3) O(8) excluding
royalties(EUR/lb) 56.92 56.92 55.46 EUR/lb
--------------------- ------------ ------- -------- --------
Selling cost
--------------------- ------------ ------- -------- --------
Total Selling
costs (% revenues) 2.70% 2.70% 5.20% %
--------------------- ------------ ------- -------- --------
Modifying Factors
--------------------- ------------ ------- -------- --------
Mine Recovery 95% 95% 99% %
--------------------- ------------ ------- -------- --------
Dilution 4% 4% 1% %
--------------------- ------------ ------- -------- --------
Plant Recovery 85% 85% 85% %
--------------------- ------------ ------- -------- --------
Cut Off Grade
Estimate
--------------------- ------------ ------- -------- --------
Operating Cost
(EUR/t processed) 9.45 9.90 8.63 EUR/t
--------------------- ------------ ------- -------- --------
Price U(3) O(8)
(EUR/t) 0.125 0.125 0.122 EUR/g
--------------------- ------------ ------- -------- --------
COG (ppm U(3)
O(8) ) 97 102 85 ppm
--------------------- ------------ ------- -------- --------
Based on the outcome of the pay limit grade calculation a mining
cut-off grade was selected for each of the sites and applied to the
mineral resource models. The cut-off grades selected are higher
than the pay limit for each of the sites in order to optimise the
economic margin. The cut-off grades selected for each site
were:
-- Retortillo: 110ppm
-- Santidad: 100ppm
-- Zona 7: 125ppm
-- Alameda: 90ppm
Table 18 to Table 21 present the Mineral Resources considered
for each deposit at the mining cut off.
Table 18: Mineral Resources Considered for Mining at 110ppm -
Retortillo
Resources Tonnage (Mt) Grade (ppm) Content (Mlb)
Category
----------- ------------- ------------ --------------
Measured 7.0 345 5.3
----------- ------------- ------------ --------------
Indicated 15.9 275 9.7
----------- ------------- ------------ --------------
Inferred 0.0 0 0.0
----------- ------------- ------------ --------------
Table 19: Mineral Resources Considered for Mining at 100ppm -
Santidad
Resources Tonnage (Mt) Grade (ppm) Content (Mlb)
Category
----------- ------------- ------------ --------------
Measured 0.0 0 0.0
----------- ------------- ------------ --------------
Indicated 10.0 203 4.5
----------- ------------- ------------ --------------
Inferred 0.5 228 0.2
----------- ------------- ------------ --------------
Table 20: Mineral Resources Considered for Mining at 125ppm -
Zona 7
Resources Tonnage (Mt) Grade (ppm) Content (Mlb)
Category
----------- ------------- ------------ --------------
Measured 6.8 553 8.3
----------- ------------- ------------ --------------
Indicated 13.9 603 18.5
----------- ------------- ------------ --------------
Inferred 9.9 255 5.6
----------- ------------- ------------ --------------
Table 21: Mineral Resources Considered for Mining at 90ppm -
Alameda
Resources Tonnage (Mt) Grade (ppm) Content (Mlb)
Category
----------- ------------- ------------ --------------
Measured 0.0 0 0.0
----------- ------------- ------------ --------------
Indicated 37.4 290.4 24.0
----------- ------------- ------------ --------------
Inferred 0.0 0.0 0.0
----------- ------------- ------------ --------------
Planned dilution of Retortillo, Santidad and Zona 7 was applied
through regularisation of the block model. The original resource
model produced by Mr. Titley was populated with minimum block sizes
of 5m x 5m x 1.5m. The block model was then regularised to 5m x 5m
x 6m to account for the selective mining unit. In addition to this,
dilution of 4% was applied to account for unplanned dilution due to
blast movement, mixing of ore and waste and mining angles.
Planned dilution of Alameda was applied through regularisation
of the block model. The original resource model was populated with
minimum block sizes of 5m x 5m x 1.5m. The block model was then
regularised to 10m x 10m x 6m to account for the selective mining
unit. As a larger selective mining unit was applied to the Alameda
model, lower dilution was applied in comparison to the other
deposits. An additional dilution of 1% and was applied to account
for unplanned dilution due to blast movement, mixing of ore and
waste and mining angles.
An allowance was made for ore loss to account for:
-- Broken ore not loaded or loaded to waste (boundary
effect).
-- Ore not broken due to inaccurate mining or mining
complications.
-- Ore spillage during the mucking and hauling process, between
the mining face and the RoM stockpile.
As with the dilution these modifying factors are affected by the
size of the selective mining unit. Ore loss allowed for Retortillo,
Santidad and Zona 7 was 5% while at Alameda this was lower at 1%
due to the larger SMU block size modelled.
The Mineral Resources, cut off grades and modifying factors
described above were used to generate the mining inventory from the
Mineral Resource models. The process followed involved the
following steps:
-- The selected cut-off grade was applied to the full model to
define the payable Mineral Resources.
-- A design process was undertaken (pit optimisation, pit design
and schedule) which defined the payable ore that would be included
into the mining plan.
-- The Mineral Resources contained in the mining plan were
modified by the modifying factors (dilution and ore loss) to give
the modified mining inventory.
Table 22 to 25 show the steps in the generation of the mining
inventory for each of the deposits.
Table 22: Generation of Mining Inventory - Retortillo
Description Cut Resource Tonnage Grade Content
Off Category (Mt) (ppm) (Mlb)
Grade
(ppm)
------------- ------- ---------- -------- ------- --------
Full
Model 0 Measured 110.3 28 6.7
------------- ------- ---------- -------- ------- --------
Indicated 286.3 22 13.8
------------- ------- ---------- -------- ------- --------
Inferred 0.0 0 0.0
------------- ------- ---------- -------- ------- --------
Full
Model 110 Measured 7.0 345 5.3
------------- ------- ---------- -------- ------- --------
Indicated 15.9 275 9.7
------------- ------- ---------- -------- ------- --------
Inferred 0.0 0 0.0
------------- ------- ---------- -------- ------- --------
Design
Inventory 110 Measured 4.0 413 3.7
------------- ------- ---------- -------- ------- --------
Indicated 7.4 342 5.6
------------- ------- ---------- -------- ------- --------
Inferred 0.0 0 0.0
------------- ------- ---------- -------- ------- --------
Modified
Inventory 110 Measured 4.0 397 3.5
------------- ------- ---------- -------- ------- --------
Indicated 7.3 329 5.3
------------- ------- ---------- -------- ------- --------
Inferred 0.0 0 0.0
------------- ------- ---------- -------- ------- --------
Table 23: Generation of Mining Inventory - Santidad
Description Cut Resource Tonnage Grade Content
Off Category (Mt) (ppm) (Mlb)
Grade
(ppm)
------------- ------- ---------- -------- ------- --------
Full
Model 0 Measured 0.0 0 0.0
------------- ------- ---------- -------- ------- --------
Indicated 274.1 13 7.9
------------- ------- ---------- -------- ------- --------
Inferred 31.8 6 0.4
------------- ------- ---------- -------- ------- --------
Full
Model 100 Measured 0.0 0 0.0
------------- ------- ---------- -------- ------- --------
Indicated 10.0 203 4.5
------------- ------- ---------- -------- ------- --------
Inferred 0.5 228 0.2
------------- ------- ---------- -------- ------- --------
Design
Inventory 100 Measured 0.0 0 0.0
------------- ------- ---------- -------- ------- --------
Indicated 4.7 268 2.8
------------- ------- ---------- -------- ------- --------
Inferred 0.2 265 0.1
------------- ------- ---------- -------- ------- --------
Modified
Inventory 100 Measured 0.0 0 0.0
------------- ------- ---------- -------- ------- --------
Indicated 4.6 258 2.6
------------- ------- ---------- -------- ------- --------
Inferred 0.2 255 0.1
------------- ------- ---------- -------- ------- --------
Table 24: Generation of Mining Inventory - Zona 7
Description Cut Resource Tonnage Grade Content
Off Category (Mt) (ppm) (Mlb)
Grade
(ppm)
------------- ------- ---------- -------- ------- --------
Full
Model 0 Measured 10.7 375 8.9
------------- ------- ---------- -------- ------- --------
Indicated 26.8 340 20.1
------------- ------- ---------- -------- ------- --------
Inferred 27.4 121 7.3
------------- ------- ---------- -------- ------- --------
Full
Model 125 Measured 6.8 553 8.3
------------- ------- ---------- -------- ------- --------
Indicated 13.9 603 18.5
------------- ------- ---------- -------- ------- --------
Inferred 9.9 255 5.6
------------- ------- ---------- -------- ------- --------
Design
Inventory 125 Measured 6.6 564 8.2
------------- ------- ---------- -------- ------- --------
Indicated 12.1 649 17.3
------------- ------- ---------- -------- ------- --------
Inferred 0.4 466 0.4
------------- ------- ---------- -------- ------- --------
Modified
Inventory 125 Measured 6.5 542 7.8
------------- ------- ---------- -------- ------- --------
Indicated 11.9 624 16.4
------------- ------- ---------- -------- ------- --------
Inferred 0.4 448 0.4
------------- ------- ---------- -------- ------- --------
Table 25: Generation of Mining Inventory - Alameda
Description Cut Resource Tonnage Grade Content
Off Category (Mt) (ppm) (Mlb)
Grade
(ppm)
------------- ------- ---------- --------- ------- --------
Full
Model 0 Measured 0.0 0 0.0
------------- ------- ---------- --------- ------- --------
Indicated 613.3 194 262.9
------------- ------- ---------- --------- ------- --------
Inferred 15,885.0 0 0.0
------------- ------- ---------- --------- ------- --------
Full
Model 90 Measured 0.0 0 0.0
------------- ------- ---------- --------- ------- --------
Indicated 37.4 290 24.0
------------- ------- ---------- --------- ------- --------
Inferred 0.0 0 0.0
------------- ------- ---------- --------- ------- --------
Design
Inventory 90 Measured 0.0 0 0.0
------------- ------- ---------- --------- ------- --------
Indicated 26.4 330 19.2
------------- ------- ---------- --------- ------- --------
Inferred 0.0 0 0.0
------------- ------- ---------- --------- ------- --------
Modified
Inventory 90 Measured 0.0 0 0.0
------------- ------- ---------- --------- ------- --------
Indicated 26.4 327 19.0
------------- ------- ---------- --------- ------- --------
Inferred 0.0 0 0.0
------------- ------- ---------- --------- ------- --------
It is specifically noted that small amounts of Inferred Mineral
Resources are contained in the mining inventory for the Santidad
and Zona 7 deposits. These Inferred resources are unavoidably mined
during the extraction of the Measured and Indicated Resources and
comprises less than 1% of the total Mining Inventory and will
therefore have an insignificant impact on the financial viability
of the project. These Inferred Mineral Resources have not been
included into the stated Ore Reserves for the project.
Ore Reserve estimation
The results of the techno-economic evaluation (below)
demonstrate that the project is economically viable based on the
designs established and the assumptions used in this study. It is
therefore possible to declare an Ore Reserve for the Salamanca
project.
The Ore Reserve Statement is shown in the Table 26.
Table 26: Salamanca project Ore Reserve Statement
Deposit Ore Reserve Tonnage Grade Content
Name Category (Mt) (ppm) (Mlb)
------------ ------------- -------- ------- --------
Retortillo Proved 4.0 397 3.5
------------ ------------- -------- ------- --------
Probable 7.3 329 5.3
-------------------------- -------- ------- --------
Santidad Proved 0.0 0 0.0
------------ ------------- -------- ------- --------
Probable 4.6 258 2.6
-------------------------- -------- ------- --------
Zona 7 Proved 6.5 542 7.8
------------ ------------- -------- ------- --------
Probable 11.9 624 16.4
-------------------------- -------- ------- --------
Alameda Proved 0.0 0 0.0
------------ ------------- -------- ------- --------
Probable 26.4 327 19.0
-------------------------- -------- ------- --------
Other material modifying factors
Economic
A detailed financial model and discounted cash flow analysis was
been prepared in order to demonstrate the economic viability of the
Ore Reserves. The NPV of the projected cash flows is US$531.9
million at an 8% (real) discount rate, with an IRR of 60%.
he table below give a summary of the results of this financial
evaluation.
Table 27: Summary of Project Financial Evaluation
Description Value Unit
------------------------ ------- ---------------
Production
------------------------ ------- ---------------
Life of Mine (LOM) 13.75 years
------------------------ ------- ---------------
Ore Mined 61.3 tonnes'million
------------------------ ------- ---------------
Ore Grade 408 ppm
------------------------ ------- ---------------
Recovered U3O8 48.6 Mlbs U(3)
O(8)
------------------------ ------- ---------------
Operating Cost
------------------------ ------- ---------------
Life of Mine C1 Cash 15.39 USD/lb
Cost U(3) O(8)
------------------------ ------- ---------------
Life of Mine C2 Cash 17.15 USD/lb
Cost U(3) O(8)
------------------------ ------- ---------------
Life of Mine All-in 20.25 USD/lb
Cash Cost U(3) O(8)
------------------------ ------- ---------------
LOM Operating Cost 899.2 USD'million
------------------------ ------- ---------------
Capital Cost
------------------------ ------- ---------------
Capital to First 95.7 USD'million
Production
------------------------ ------- ---------------
LOM Capital Cost 274.4 USD'million
------------------------ ------- ---------------
Revenue
------------------------ ------- ---------------
Sales Pricing Basis UXC Forecasted
Q2 2016
------------------------ ------------------------
Sales Price (LOM 52.07 USD/lb
Avg.) U(3) O(8)
------------------------ ------- ---------------
Total Gross Sales 2532.4 USD'million
(LOM)
------------------------ ------- ---------------
Financial Metrics
------------------------ ------- ---------------
EBITDA (Maximum Annual) 226.3 USD'million
------------------------ ------- ---------------
Post-Tax NPV (8%) 531.9 USD'million
------------------------ ------- ---------------
Post-Tax IRR 59.7 %
------------------------ ------- ---------------
It is noted that limited amounts of risk capital have been spent
on the project prior to the initiation of project implementation on
the following:
-- Road diversion at Retortillo site.
-- Power line diversion at Retortillo site
-- Elements of the Front End Engineering & Design (FEED) program.
The total amount of capital expended on these items is
approximately EUR3 million, this expenditure is considered sunk
capital and is not included in the financial evaluation. Based on
the financial evaluation sensitivities this capital does not
materially affect the financial outcome or the viability of the
project.
Infrastructure
Road, power line and communications are available for Retortillo
and Zona 7.
A land acquisition process has begun with some land already
acquired. It is not expected that there will be difficulties in
reaching amicable agreements with the current landowners in the
future.
Access infrastructure is minor due to existing roads, and the
same is applicable for power, water, etc for Alameda.
The land acquisition process has not begun at Alameda.
Difficulties to reach amicable agreements with the current
landowners is not expected. In the event any difficulties are
encountered, Spanish law provides for companies to initiate a land
expropriation process. Total land to be acquired is approximately
487Ha.
Environmental, Permitting, Legal and Socioeconomic Position
All permits have been approved for initial infrastructure
development to commence with the road deviation and upgrading of
existing power line underway.
The main permits at Retortillo have been granted including the
Environmental Licence and a 30 year Mining License valid until
2044. The Mining Licence is renewable for two further periods of 30
years each. The initial Authorization of the Radioactive facility
has also been received by the Company.
Zona 7 lies on the Alisos Investigation Permit (PI 6605-20)
which is 100% owned by a wholly owned subsidiary of Berkeley
Energia Limited. The Alisos Investigation Permit is currently in
the first year of the third three year term which was granted on 11
January 2016.
Alameda lies on the Salamanca XXVIII Definitive State Reserve
6362 which is 100% owned by a wholly owned subsidiary of the
Company.
The Definitive State Reserve is currently in the twelfth year of
its second 30 year term (valid until 2033) and may be extended for
an additional period of 30 years. It covers an area of 16.5km(2)
and includes the entire area containing the Alameda
mineralisation.
Competent Persons Statement
The information in this announcement that relates to Definitive
Feasibility Study is based on, and fairly represents, information
compiled or reviewed by Mr. Jeffrey Peter Stevens, a Competent
Person who is a Member of The Southern African Institute of Mining
& Metallurgy, a 'Recognised Professional Organisation' (RPO)
included in a list posted on the ASX website from time to time. Mr.
Stevens is employed by MDM Engineering (part of the Amec Foster
Wheeler Group). Mr. Stevens has sufficient experience that is
relevant to the style of mineralization and type of deposit under
consideration and to the activity being undertaken 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. Stevens 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 Ore Reserve
Estimates, Mining, Uranium Preparation, Infrastructure, Production
Targets and Cost Estimation is based on, and fairly represents,
information compiled or reviewed by Mr. Andrew David Pooley, a
Competent Person who is a Member of The Southern African Institute
of Mining and Metallurgy', a Recognised Professional Organisation'
(RPO) included in a list posted on the ASX website from time to
time. Mr. Pooley is employed by Bara Consulting (Pty) Ltd. Mr.
Pooley has sufficient experience that is relevant to the style of
mineralization and type of deposit under consideration and to the
activity being undertaken 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.
Pooley 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 announcement that relates to the Mineral
Resources for Zona 7 is based on, and fairly represents,
information compiled or reviewed by Mr Malcolm Titley, a Competent
Person who is a Member of The Australasian Institute of Mining and
Metallurgy. Mr Titley is employed by Maja Mining 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.
The information in this announcement that relates to the Mineral
Resources for Retortillo is extracted from the announcement
entitled 'Increase in Retortillo grade expected to boost economics'
dated 7 January 2015 which is available to view on Berkeley's
website at www.berkeleyenergia.com. The information in the original
announcement is based on, and fairly represents, information
compiled by Mr Malcolm Titley, a Competent Person who is a Member
of The Australasian Institute of Mining and Metallurgy. Mr Titley
is employed by Maja Mining 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'. The Company confirms that it is not
aware of any new information or data that materially affects the
information included in the original market announcement and, in
the case of estimates of Mineral Resources that all material
assumptions and technical parameters underpinning the estimates in
the relevant market announcement continue to apply and have not
materially changed. The Company confirms that the form and context
in which the Competent Person's findings are presented have not
been materially modified from the original market announcement.
The information in this announcement that relates to the Mineral
Resources for Alameda (refer ASX announcement dated 31 July 2012)
is based on information compiled by Mr Craig Gwatkin, who is a
Member of The Australasian Institute of Mining and Metallurgy and
was an employee of Berkeley Energy Limited at the time of initial
disclosure. Mr Gwatkin 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 2004 Edition of the
'Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves'. Mr Gwatkin consents to the inclusion
in the announcement 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. It has not been
updated since to comply with the JORC Code 2012 on the basis that
the information has not materially changed since it was last
reported.
Forward Looking Statements
This announcement may include forward-looking statements. These
forward-looking statements are based on Berkeley's expectations and
beliefs concerning future events. Forward looking statements are
necessarily subject to risks, uncertainties and other factors, many
of which are outside the control of Berkley, which could cause
actual results to differ materially from such statements. Berkeley
makes no undertaking to subsequently update or revise the
forward-looking statements made in this announcement, to reflect
the circumstances or events after the date of that
announcement.
JORC Code, 2012 Edition - Table 1 report (Zona 7)
Section 1 Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria JORC Code explanation Commentary
================== ========================================= ======================================
Sampling Nature and quality of Berkeley reverse circulation
techniques sampling (eg cut channels, (RC) drill samples are collected
random chips, or specific over 1m intervals. Multiple
specialised industry methods were used to determine
standard measurement uranium mineralisation intervals
tools appropriate to including down hole gamma
the minerals under investigation, analysis, hand held scintillometer
such as down hole gamma measurements and portable
sondes, or handheld XRF XRF analysis. Intervals
instruments, etc). These containing uranium mineralisation
examples should not be were selected and submitted
taken as limiting the for laboratory assay analysis.
broad meaning of sampling. Berkeley diamond drill (DD)
core was sampled using 0.25-1.85m
intervals in the mineralised
zones, including areas of
internal low grade or waste.
In addition, the sampling
was extended 3-5m up and
down hole from the interpreted
mineralised zone. Half or
quarter core was used for
sampling.
Junta de Energía Nuclear
(JEN) DD core was sampled
using 0.25m, 0.20m and 1.00m
intervals in the mineralised
zones, with 0.25m intervals
being the most frequent
sample length.
========================================= ======================================
Include reference to Standards and blanks are
measures taken to ensure inserted into the sample
sample representivity stream to assess the accuracy,
and the appropriate calibration precision and methodology
of any measurement tools of the external laboratories
or systems used. used. In addition, field
duplicate samples are inserted
to assess the variability
of the uranium mineralisation.
Approximately 15-20% of
all samples relate to quality
control. In addition, the
laboratories undertake their
own duplicate sampling as
part of their internal QA/QC
processes. Examination of
the QA/QC sample data indicates
satisfactory performance
of field sampling protocols
and assay laboratories providing
acceptable levels of precision
and accuracy.
Drill hole collar locations
are surveyed by qualified
surveyors (Cubica Ingeniería
Metrica S.L) using standard
differential GPS (DGPS)
equipment achieving sub
decimetre accuracy in horizontal
and vertical position. Down-hole
surveys are undertaken using
a Geovista down-hole deviation
probe. Measurements are
taken every 1cm down hole
and averaged every 5m or
10m. No strongly magnetic
rocks are present within
the deposit which may affect
magnetic based readings.
JEN sampled whole core using
0.25m, 0.20m and 1.00m interval
lengths. QA/QC protocols
used are unknown.
========================================= ======================================
Aspects of the determination RC drill samples are collected
of mineralisation that over 1m intervals, manually
are Material to the Public homogenised before being
Report. In cases where split on site using a three
'industry standard' work tier riffle splitter to
has been done this would provide an approximate 3-5kg
be relatively simple sample. In rare cases, wet
(eg 'reverse circulation samples are split using
drilling was used to a cone and quarter method.
obtain 1 m samples from Scintillometer measurements
which 3 kg was pulverised are taken on all samples
to produce a 30 g charge and this data is used to
for fire assay'). In select the samples to be
other cases more explanation sent to external laboratories
may be required, such for sample preparation and
as where there is coarse analysis. Indicative mineralised
gold that has inherent intervals are determined
sampling problems. Unusual from this data and the sampling
commodities or mineralisation extended up and down hole
types (eg submarine nodules) by at least 2-5m.
may warrant disclosure Samples are further split
of detailed information. in the core shed using a
scoop such that 0.7-1kg
samples are sent to the
preparation laboratories
of ALS and AGQ (Seville,
Spain) and analytical laboratory
of ALS (Loughrea, Ireland).
Samples are dried, fine
crushed down to 70% below
2mm, split to obtain 250g
and pulverised with at least
85% of the sample passing
75um. 10g of sample is used
for uranium analysis by
pressed powder X-ray fluorescence
(XRF) method. (2013, 2014,
2015 and 2016 drilling campaigns).
Samples from the 2007 and
2008 drilling campaigns
were sent to Actlabs Canada
for uranium analysis by
the Delayed Neutron Counting
(DNC) method.
JEN core samples were prepared
in internal company laboratories
and assayed for uranium
using XRF, Atomic absorption
spectroscopy (AAS) or fluorometric
methods.
================== ========================================= ======================================
Drilling Drill type (eg core, Berkeley drilling comprised
techniques reverse circulation, both DD (HQ) and RC drilling
open-hole hammer, rotary using a 140mm diameter face
air blast, auger, Bangka, sampling hammer.
sonic, etc) and details For angled DD oriented core
(eg core diameter, triple was achieved using DeviCore
or standard tube, depth measurements (2014 and 2015
of diamond tails, face-sampling drilling campaigns).
bit or other type, whether The historical JEN drilling,
core is oriented and which accounts for approximately
if so, by what method, 15% of the total drilling,
etc). was used DD (NQ).
================== ========================================= ======================================
Drill Method of recording and Berkeley and JEN DD typically
sample assessing core and chip recorded overall core recoveries
recovery sample recoveries and in excess of 90%, which
results assessed. is considered acceptable.
Berkeley RC drill samples
are collected over 1m intervals
through a cyclone. Plastic
sample bags are strapped
to the cyclone to maximise
sample recovery. Individual
sample bags are not weighed
to assess sample recovery
but a visual inspection
is made by the Company geologist
to ensure all samples are
of approximately equivalent
size.
========================================= ======================================
Measures taken to maximise The DD drilling rigs used
sample recovery and ensure face discharge bits to ensure
representative nature a low contact between the
of the samples. rock and drilling fluids,
minimising ore washing.
Core was cut using a water
saw with care taken to ensure
minimal ore loss.
The RC drilling rigs utilised
suitably sized compressors
to ensure dry samples where
possible. Plastic sample
bags are strapped to the
cyclone to maximise sample
recovery. Sample logs record
whether the sample is dry,
moist or wet.
========================================= ======================================
Whether a relationship Due to the solubility and
exists between sample mobility of the uranium
recovery and grade and minerals the use of water
whether sample bias may in core recovery in DD is
have occurred due to controlled.
preferential loss/gain There is no known relationship
of fine/coarse material. between sample recovery
and grade. The RC sample
recoveries are of an acceptable
level and no bias is expected
from any sample losses.
================== ========================================= ======================================
Logging Whether core and chip Berkeley logging of DD core
samples have been geologically included recording descriptions
and geotechnically logged of lithology, age, colour,
to a level of detail oxidation, mineralisation,
to support appropriate alteration, weathering,
Mineral Resource estimation, structures, textures, grain
mining studies and metallurgical size and mineralogy.
studies. Berkeley geotechnical logging
of DD core included recording
descriptions of integrity
(recovery and RQD), materials
(lithology, rock strength
and depth oxide staining),
structures (type, angle,
contact type, infill, weathering)
Berkeley structural logging
of DD core included recording
descriptions of structure
type, structural angles,
contact type, infill, line
type and slip direction.
Berkeley alteration logging
of DD core included recording
descriptions of metamorphic
textures, alteration mineralogy
and mineralisation style.
Berkeley geological logging
of RC chip samples included
recording descriptions of
lithology, weathering, alteration
and mineralisation. A scintillometer
reading of counts per second
(cps) was recorded for each
1m sample (quantitative).
JEN geological logging of
DD core included recording
descriptions of lithology,
iron oxides, sulphides,
uranium mineralogy, fracturing
and no recovery zones.
========================================= ======================================
Whether logging is qualitative Geological logging is qualitative
or quantitative in nature. in nature.
Core (or costean, channel,
etc) photography. Berkeley DD core boxes and
samples and RC samples and
chip trays were photographed.
JEN did not take photographs
of drill core.
========================================= ======================================
The total length and All DD and RC drill holes
percentage of the relevant are logged in full by Company
intersections logged. geologists.
================== ========================================= ======================================
Sub-sampling If core, whether cut Berkeley DD core was sampled
techniques or sawn and whether quarter, using 0.25-1.85m intervals
half or all core taken. in the mineralised zones,
including areas of internal
low grade or waste. In addition,
the sampling was extended
3-5m up and down hole from
the interpreted mineralised
zone. Half or quarter core
was used for sampling.
JEN DD core was sampled
using 0.25m, 0.20m and 1.00m
intervals in the mineralised
zones, with 0.25m intervals
being the most frequent
sample length. Whole core
was used for sampling.
========================================= ======================================
and sample If non-core, whether Berkeley RC drill samples
preparation riffled, tube sampled, were collected at 1m intervals.
rotary split, etc and RC intervals were sampled
whether sampled wet or by splitting dry samples
dry. in the field to 3-5kg using
cone and quarter method
(2008 and 2013 drilling
campaigns), three tier riffle
splitter (2014 drilling
campaign) or manually homogenised
before being split on site
using a three tier riffle
splitter (2015 drilling
campaign) and further split
in the core shed to 0.7-1kg
using a scoop. Where samples
were wet they were dried
prior to spitting. In rare
cases, wet samples were
split using a cone and quarter
method.
========================================= ======================================
For all sample types, Berkeley samples (2013,
the nature, quality and 2014 and 2015 drilling campaigns)
appropriateness of the were sent to ALS and AGQ
sample preparation technique. laboratories for preparation
and ALS laboratories for
analysis. Samples were dried,
fine crushed down to 70%
below 2mm and pulverised
with at least 85% of the
sample passing 75um. 10g
of sample was used for uranium
analysis by pressed powder
XRF method. Samples from
the 2007 and 2008 drilling
campaigns were sent to Actlabs
Canada for uranium analysis
by the DNC method. These
methods are considered appropriate
for this style of uranium
mineralisation.
JEN core samples were prepared
and assayed for uranium
at internal company laboratories
using XRF, AAS or fluorometric
methods.
========================================= ======================================
Quality control procedures Previous field tests have
adopted for all sub-sampling determined that the sample
stages to maximise representivity size and method of sampling
of samples. produce representative RC
samples. QA/QC procedures
involve the use of standards,
duplicates and blanks which
are inserted into sample
batches at a frequency of
approximately 15-20%.
Quality control procedures
used by JEN are unknown.
========================================= ======================================
Measures taken to ensure Duplicate splits of RC samples
that the sampling is are taken every 10m down
representative of the hole within the sampled
in situ material collected, intervals. The results from
including for instance these duplicates generally
results for field duplicate/second-half show acceptable repeatability,
sampling. however indications of inhomogeneity
were observed in a number
of duplicates.
========================================= ======================================
Whether sample sizes The uranium is typically
are appropriate to the very fine grained. Previous
grain size of the material test work carried out by
being sampled. Berkeley using different
sample sizes has demonstrated
that the selected sample
size is appropriate.
================== ========================================= ======================================
Quality The nature, quality and Berkeley assayed samples
of assay appropriateness of the for uranium using the DNC
data assaying and laboratory method during the 2007 and
and laboratory procedures used and whether 2008 drilling campaigns
tests the technique is considered and pressed powder XRF during
partial or total. the 2013, 2014 and 2015
drilling campaigns. These
analytical methods report
total uranium content.
JEN assayed samples for
uranium were completed at
internal company laboratories
using XRF, AAS or fluorometric
methods. No QA/QC data is
available for this historical
data.
========================================= ======================================
For geophysical tools, Down-hole gamma logging
spectrometers, handheld was undertaken for all probe
XRF instruments, etc, accessible holes drilled
the parameters used in by Berkeley to provide eU(3)
determining the analysis O(8) ("equivalent" U(3)
including instrument O(8) grade) data. The down-hole
make and model, reading gamma response was converted
times, calibrations factors to eU(3) O(8) by correcting
applied and their derivation, for radon, hole diameter,
etc. air/water and a deconvolution
filter was also applied.
eU(3) O(8) data was only
considered in the mineral
resource estimation process
when chemical assay data
was not available.
========================================= ======================================
Nature of quality control Standards, blanks and duplicates
procedures adopted (eg were regularly inserted
standards, blanks, duplicates, into the sample stream by
external laboratory checks) Berkeley, with approximately
and whether acceptable 15-20% of all samples related
levels of accuracy (ie to quality control. The
lack of bias) and precision external laboratories used
have been established. also maintain their own
process of QA/QC utilising
standards, pulp repeats,
sample duplicates and blanks.
Standards, blanks and duplicates
are regularly inserted into
the sample stream with approximately
15-20% of all samples related
to quality control. The
external laboratories used
also maintain their own
process of QA/QC utilising
standards, pulp repeats,
sample duplicates and blanks.
Review of the Berkeley quality
control samples, as well
as the external laboratory
quality QA/QC reports, has
shown no sample preparation
issues, acceptable levels
of accuracy and precision
and no bias in the analytical
datasets.
JEN used internal company
laboratories. No QA/QC data
is available for this historic
data.
================== ========================================= ======================================
Verification The verification of significant Reported significant intersections
of sampling intersections by either have been checked and verified
and assaying independent or alternative by Senior Geological management
company personnel. and Independent CP Malcolm
Titley (Maja Mining Ltd.).
========================================= ======================================
The use of twinned holes. No twinned holes were drilled
for the current mineral
resource estimation process.
========================================= ======================================
Documentation of primary All primary data was recorded
data, data entry procedures, in templates designed by
data verification, data Berkeley. Assay data from
storage (physical and the external laboratory
electronic) protocols. is received in spreadsheets
and downloaded directly
into an Access Database
managed by the Company.
Data is entered into controlled
excel templates for validation.
The validated data is then
loaded into a password secured
relational database by a
designated Company geologist.
Daily backups of all digital
data are undertaken. These
procedures are documented
in the Berkeley Technical
Procedures and Protocols
manual.
JEN primary paper data was
digitalized and recoded
following the Berkeley protocols.
The validated data was then
loaded into a password secured
relational database by a
designated Company geologist.
========================================= ======================================
Discuss any adjustment Uranium (ppm) assays received
to assay data. from the external laboratory
are converted to U(3) O(8)
(ppm) using the stoichiometric
factor of 1.179.
================== ========================================= ======================================
Location Accuracy and quality Berkeley drill hole collar
of data of surveys used to locate locations were surveyed
points drill holes (collar and by qualified surveyors (Cubica
down-hole surveys), trenches, Ingeniería Metrica
mine workings and other S.L) using standard differential
locations used in Mineral GPS (DGPS) equipment achieving
Resource estimation. sub decimetre accuracy in
horizontal and vertical
position.
Berkeley down-hole surveys
were undertaken using a
Geovista down-hole deviation
probe. Measurements were
taken every 1cm down hole
and averaged every 5m or
10m. No strongly magnetic
rocks are present within
the deposit which may affect
magnetic based readings.
JEN holes were drilled on
grid coordinates and were
not surveyed after drilling.
========================================= ======================================
Specification of the The grid system is ETRS
grid system used. 1989 UTM Zone 29N.
========================================= ======================================
Quality and adequacy Topographic control is based
of topographic control. on a digital terrain model
with sub metric accuracy
sourced from the Spanish
Geographical Institute (Instituto
Geográfico Nacional)
and is verified through
detailed drill hole collar
surveys by a qualified surveyor
using a DGPS.
================== ========================================= ======================================
Data Data spacing for reporting The majority of the Berkeley
spacing of Exploration Results. drilling was undertaken
and distribution on a notional 35m by 35m
in the two first year open
pit production inside Domain
6, 50m by 50m grid in the
rest of the Domain 6 and
100m by 100m in the other
smaller domains, with section
lines orientated approximately
perpendicular to the interpreted
strike of the mineralisation.
The historical JEN drilling
was completed on a closer
spaced 35m by 35m grid within
the previous resource area.
========================================= ======================================
Whether the data spacing The data spacing (notionally
and distribution is sufficient 35m by 35m) is considered
to establish the degree sufficient to assume geological
of geological and grade and grade continuity, and
continuity appropriate allow the estimation of
for the Mineral Resource Measured Mineral Resources.
and Ore Reserve estimation
procedure(s) and classifications
applied.
========================================= ======================================
Whether sample compositing No compositing of RC samples
has been applied. in the field has been undertaken.
================== ========================================= ======================================
Orientation Whether the orientation The mineralised zone is
of data of sampling achieves a 2-3km scale fold structure
in relation unbiased sampling of with the dominant strike
to geological possible structures and direction being NNE-SSW.
structure the extent to which this Despite the general dip
is known, considering of the host geological units
the deposit type. and structures ranging from
50-80deg, the mineralised
zone is interpreted to be
sub-horizontal to shallowly
dipping due to the nature
of the mineralisation processes.
========================================= ======================================
If the relationship between The majority of DD and RC
the drilling orientation drill holes are vertical.
and the orientation of Due to the interpreted flat
key mineralised structures lying nature of the mineralisation,
is considered to have no sampling bias is considered
introduced a sampling to have been introduced
bias, this should be by the orientation of the
assessed and reported drilling.
if material.
================== ========================================= ======================================
Sample The measures taken to Chain of custody is managed
security ensure sample security. by Berkeley. Samples were
transported from the drill
site by Company vehicle
to a sample preparation
shed where samples are prepared
for dispatch. Samples are
sent directly from the sample
preparation shed to the
laboratory using a certified
courier or a Berkeley owned
vehicle authorised for radioactive
materials transport. No
other freight is transported
with the samples which are
taken directly from the
Berkeley facility to the
external laboratory. Sample
submission forms are sent
in paper form with the samples
as well as electronically
to the laboratory. Reconciliation
of samples occurs prior
to commencement of sample
preparation for assaying.
The historical drilling
samples were prepared and
analysed using internal
company laboratories. The
chain of custody is unknown.
================== ========================================= ======================================
Audits The results of any audits Sampling techniques and
or reviews or reviews of sampling procedures, as well as QA/QC
techniques and data. data, are reviewed internally
an ongoing basis. Mr Malcolm
Titley (Geology Consultant,
Maja Mining Limited) has
independently reviewed the
sampling techniques, procedures
and data. He has undertaken
a site visit to review and
inspect the application
of procedures. These reviews
have concluded that the
sampling and analytical
results have resulted in
data suitable for incorporation
into Mineral 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 Type, reference name/number, The Zona 7 Prospect lies
tenement location and ownership on the Alisos Investigation
and land including agreements Permit PI 6605-20 which
tenure or material issues with is 100% owned by Minera
status third parties such as de Río Alagón,
joint ventures, partnerships, a wholly owned subsidiary
overriding royalties, of Berkeley Energia Limited.
native title interests,
historical sites, wilderness The Alisos Investigation
or national park and Permit is currently in the
environmental settings. first year of the third
three-year term which was
granted on January 11(th)
2016.
No historical sites, wilderness
or national parks are located
within the Permit. The Zona
7 Prospect is located adjacent
to the village of Villavieja
de Yeltes.
=============================== ======================================
The security of the Tenure in the form of an
tenure held at the time Investigation Permit has
of reporting along with been granted and is considered
any known impediments secure. There are no known
to obtaining a licence impediments to obtaining
to operate in the area. a licence to operate in
this area.
==================== =============================== ======================================
Exploration Acknowledgment and appraisal Previous exploration at
done by of exploration by other Zona 7 was completed initially
other parties. by Junta de Energía
parties Nuclear (JEN) and then Empresa
Nacional de Uranio S.A.
(ENUSA), both Spanish state
run companies, from the
late 1950's through to the
mid 1980's. Work completed
by JEN and ENUSA included
mapping, radiometric surveys,
trenching and diamond (DD)
and open-hole (OH) drilling.
A detailed data assessment
and verification of the
historic data supplied by
ENUSA has been undertaken.
No significant issues with
the data were detected.
==================== =============================== ======================================
Geology Deposit type, geological The uranium mineralisation
setting and style of is hosted within Lower Cambrian
mineralisation. metasediments adjacent to
granite. The mineralisation
typically occurs as a sub-horizontal
to shallowly dipping layer
occurring between surface
and 100m depth, although
mineralisation has been
recorded to a maximum depth
of 217m. The style of the
uranium mineralisation includes
veins, stockwork and disseminated
mineralisation in joint/fracture
filling associated with
brittle deformation. Uraninite
and coffinite are the primary
uranium minerals. Secondary
uranium mineralisation is
developed in "supergene-like"
tabular zones corresponding
to the depth of weathering.
Most of the mineralisation
is hosted within partially
weathered and unweathered
metasediment. This deposit
falls into the category
defined by the International
Atomic Energy Association
(IAEA) as Vein Type, Sub
Type Iberian Type.
==================== =============================== ======================================
Drill A summary of all information Details of all reported
hole Information material to the understanding drill holes are provided
of the exploration results in Appendix B of this release.
including a 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 All of this information
this information is is Material and has been
justified on the basis included in Appendix B of
that the information this release.
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 Reported drill intersections
methods Results, weighting averaging are based on chemical assay
techniques, maximum data and are calculated
and/or minimum grade using a 200ppm U(3) O(8)
truncations (eg cutting cut-off, no high grade cut,
of high grades) and and may include up to 2m
cut-off grades are usually of internal dilution.
Material and should
be stated.
=============================== ======================================
Where aggregate intercepts High grade intervals that
incorporate short lengths are internal to broader
of high grade results zones of uranium mineralisation
and longer lengths of are reported as included
low grade results, the intervals.
procedure used for such
aggregation should be
stated and some typical
examples of such aggregations
should be shown in detail.
=============================== ======================================
The assumptions used No metal equivalent values
for any reporting of are used.
metal equivalent values
should be clearly stated.
==================== =============================== ======================================
Relationship These relationships All drilling was planned
between are particularly important in such a way as to intersect
mineralisation in the reporting of expected mineralisation
widths Exploration Results. in a perpendicular manner.
and intercept If the geometry of the The uranium mineralisation
lengths mineralisation with is interpreted to be flat
respect to the drill lying to shallowly dipping
hole angle is known, so the majority of the RC
its nature should be holes have been drilled
reported. vertically. The reported
down-hole intervals are
therefore interpreted to
approximate true widths.
=============================== ======================================
If it is not known and The reported down-hole intervals
only the down hole lengths are interpreted to approximate
are reported, there true widths.
should be a clear statement
to this effect (eg 'down
hole length, true width
not known').
==================== =============================== ======================================
Diagrams Appropriate maps and Appropriate diagrams, including
sections (with scales) a drill plan and cross sections,
and tabulations of intercepts are included in the main
should be included for body of this release.
any 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 Where comprehensive All results are reported
reporting reporting of all Exploration in Appendix B of this release.
Results is not practicable,
representative reporting
of both low and high
grades and/or widths
should be practiced
to avoid misleading
reporting of Exploration
Results.
==================== =============================== ======================================
Other Other exploration data, Down-hole gamma logging
substantive if meaningful and material, of all holes is undertaken
exploration should be reported including to provide eU(3) O(8) data.
data (but not limited to): Prior comparisons of eU(3)
geological observations; O(8) data with chemical
geophysical survey results; assay data have shown that
geochemical survey results; on average eU(3) O(8) tends
bulk samples - size to underestimate at higher
and method of treatment; grades (>600ppm) and overestimate
metallurgical test results; at lower grades (<100ppm).
bulk density, groundwater, Accordingly, the eU(3) O(8)
geotechnical and rock data is not considered of
characteristics; potential sufficient quality to replace
deleterious or contaminating chemical assay data for
substances. the purposes of reporting
drilling results. The Mineral
Resources reported in this
release are estimated using
chemical assay data as the
primary method for grade
estimation in the resource
modelling process and eU(3)
O(8) data is only used where
there were no assay data
available.
==================== =============================== ======================================
Further The nature and scale Further work planned for
work of planned further work the Zona 7 Prospect includes
(eg tests for lateral infill drilling that would
extensions or depth be focused on improving
extensions or large-scale geological confidence and
step-out drilling). resource classification.
The mineralisation remains
open along strike and on
deep, with both areas to
be targeted in subsequent
drilling campaigns
Geological studies will
include detailed interpretation
of lithology, structure
and weathering and an assessment
of potential relationships
between these factors and
uranium grade distribution.
Further work is also planned
on a number of other exploration
targets within the Retortillo
Region.
=============================== ======================================
Diagrams clearly highlighting These are shown in the main
the areas of possible body of this release.
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 the preceding section also apply to this
section.)
Criteria JORC Code explanation Commentary
================ ================================== ================================================================
Database Measures taken to ensure Drill hole data is stored
integrity that data has not been in a password protected
corrupted by, for example, relational database (Access).
transcription or keying Drill data recorded in
errors, between its a spreadsheet is transferred
initial collection and to the database by the
its use for Mineral project geologist who is
Resource estimation responsible for reviewing
purposes. and validating the data.
Assay data is received
from the external laboratories
in digital format and is
loaded directly into the
database.
Geological logging is restricted
to appropriate codes relevant
to the local geology, mineralisation,
weathering and alteration
setting. A copy of the
master database is linked
to Surpac mining software
for Mineral Resource Estimation
(MRE).
================================== ================================================================
Data validation procedures Database validation checks
used. including collar survey
position, down hole survey
control, assay limits,
e-grade profiles, sample
intervals and logging codes
are completed prior to
the data being transferred
to the master database.
================ ================================== ================================================================
Site visits Comment on any site Sampling techniques and
visits undertaken by procedures, as well as
the Competent Person QA/QC data, are reviewed
and the outcome of those internally an ongoing basis.
visits. Malcolm Titley, (CP, Geology
Consultant, Maja Mining
Limited) has reviewed the
sampling techniques, procedures,
data and resource estimation
methodology. He has undertaken
a number of site visits,
the most recent being in
August 2015, to review
and inspect the application
of these procedures. He
concludes that the sampling
and analytical results
available are appropriate
for estimation of the Mineral
Resource.
================================== ================================================================
If no site visits have Site visits have been undertaken.
been undertaken indicate
why this is the case.
================ ================================== ================================================================
Geological Confidence in (or conversely, The confidence of the geological
interpretation the uncertainty of) interpretation is appropriate
the geological interpretation for the current level of
of the mineral deposit. resource estimation. The
resource is defined within
mineralised envelopes which
encompass all zones of
significant mineralisation.
================================== ================================================================
Nature of the data used Geology and mineralisation
and of any assumptions interpretation is based
made. on geological logging and
sample assays derived from
RC and DD drilling, along
with cross sectional interpretations
which include surface mapping
information and geophysical
studies.
================================== ================================================================
The effect, if any, Structural studies show
of alternative interpretations dips of structures vary
on Mineral Resource between 50deg and 80deg
estimation. however; the uranium mineralisation
has undergone supergene
remobilisation in the first
5-10m and is interpreted
to be flat lying to shallowly
dipping and generally within
100m from surface.
================================== ================================================================
The use of geology in On the deposit scale the
guiding and controlling uranium grade is controlled
Mineral Resource estimation. by both lithology and structure,
while on a local scale
the grade is interpreted
to be more influenced by
structure.
================================== ================================================================
The factors affecting Geological logging and
continuity both of grade uranium assay of samples
and geology. from drill holes has demonstrated
the continuity of the grade
and lithology between mineralised
sections. Breaks in continuity
are likely due to structural
offsets, some of which
have been observed or interpreted
from surface mapping.
================ ================================== ================================================================
Dimensions The extent and variability The Zona 7 uranium mineralisation
of the Mineral Resource covers an area of approximately
expressed as length 3.0km by 0.4km and generally
(along strike or otherwise), occurs within 100m of surface.
plan width, and depth
below surface to the
upper and lower limits
of the Mineral Resource.
================================== ================================================================
Estimation The nature and appropriateness A mineralised envelope
and modelling of the estimation technique(s) at Zona 7 is created encompassing
techniques applied and key assumptions, all zones of significant
including treatment mineralisation. A number
of extreme grade values, of different domains have
domaining, interpolation been interpreted.
parameters and maximum Geostatistical variogram
distance of extrapolation modelling was used to determine
from data points. If appropriate parameters
a computer assisted for estimation of uranium
estimation method was grade using Ordinary Kriging
chosen include a description (OK) (for all Domains)
of computer software followed by the application
and parameters used. of Uniform Conditioning
(UC) and Local Uniform
Conditioning (LUC) using
Isatis Software, in order
to simulate the grade tonnage
distribution based on a
Selective Mining Unit (SMU)
of 5m x 5m x 6m for Domain
6 only.
Surpac software was used
for mineralisation volume
interpretation. Surpac
and Isatis software were
used for uranium grade
estimation.
Three sources of drillhole
uranium grade data was
used:
* Chemical U(3) O(8) (ppm): 76%
* Down hole radiometric equivalent eU(3) O(8) (ppm):
17%
* Background based on XRF and radiometric results (10
ppm U(3) O(8) ): 7%
The drill hole spacing
for Domain 6 is nominally
35m by 35m inside the two
first year open pit production,
50m by 50 spacing in the
remaining Domain 6 area
and 100m by 100m spacing
in the remaining smaller
domains. Some of the historical
JEN DD was drilled at a
spacing of 35m by 35m.
Five mineralisation domains
were identified (2, 3,
4, 5 and 6). 1m samples
were used to estimate grade
into 25m by 25m by 6m parent
blocks using OK. Domain
6 was estimated into 5m
by 5m by 6m blocks using
LUC.
Note that the Berkeley
2015 drilling infilled
domain 6 only. So no changes
have been made to the MRE
previously reported in
April 2014 for domains
2, 3 and 4, and domain
5 reported in October 2015.
In order to reduce local
bias due to extreme high
grades, top cuts were applied
per domains:
* 2: 1,800ppm U3O8
* 3: none
* 4: 2,200ppm U(3) O(8)
* 5: 1,300ppm U(3) O(8)
* 6: 6,000ppm U(3) O(8)
Appropriate search volumes,
minimum and maximum sample
numbers and top cutting
strategy were used, based
on the results of Kriging
Neighbourhood Analysis.
The variogram nugget %
and maximum ranges in the
order of major, semi-major
and minor per domain in
meters are presented below:
* 2: 30% / 30 / 60 / 120
* 3: 30% / 40 / 80 / 160
* 4: 30% / 40 / 80 / 160
* 5: 21% / 40 / 88 / 161
* 6: 21% / 40 / 88 / 161
In-situ dry bulk densities
were assigned based on
zones of weathering intensity
and used to estimate tonnage.
================================== ================================================================
The availability of The current resource estimate
check estimates, previous was compared with the previous
estimates and/or mine resource estimate (October
production records and 2015) which was based on
whether the Mineral earlier drill campaigns
Resource estimate takes (historical, 2007, 2008,
appropriate account 2013 and 2014) and to a
of such data. polygonal estimation. Both
of which support the current
results.
No mining production has
taken place at Zona 7.
================================== ================================================================
The assumptions made The resource model only
regarding recovery of estimates uranium.
by-products.
================================== ================================================================
Estimation of deleterious At this stage, there are
elements or other non-grade no deleterious elements
variables of economic or other non-grade variables
significance (eg sulphur identified as being of
for acid mine drainage economic significance at
characterisation). Zona7.
================================== ================================================================
In the case of block The uranium grade is estimated
model interpolation, into the 25m (X) by 25m
the block size in relation (Y) by 6m (Z) blocks using
to the average sample OK. This compares to the
spacing and the search average drill spacing of
employed. 35-50m in X and Y. UC and
LUC were used to estimate
the expected grade tonnage
distribution for the chosen
SMU of 5m x 5m x 6m in
Domain 6 which contains
>88% of the resource, and
contains the material classified
as Measured and Indicated,
and is targeted for mining
in the early years of production.
This SMU size was chosen
to match the feasibility
study open cut mining methodology.
OK was used to estimate
grade in the remaining
smaller domains which account
for <12% of the MRE and
which have wider spaced
drill data classified as
Inferred material.
================================== ================================================================
Any assumptions behind SMU dimensions have been
modelling of selective chosen based on results
mining units. of the current open pit
feasibility study with
load and haul being conducted
with 125 tonne backhoe
excavators and 100 tonne
dump trucks.
================================== ================================================================
Any assumptions about Uranium is the only economic
correlation between metal estimated in the
variables. current resource model.
================================== ================================================================
Description of how the Geological interpretation
geological interpretation controlled the volume of
was used to control the resource estimate by
the resource estimates. restricting the interpretation
of the mineralisation volume
and associated samples
to material with continuity
above a 100 ppm U(3) O(8)
grade.
The domains are based on
geology, structure and
uranium grade with defined
zones of mineralisation
that show continuity along
and across strike.
A further division of the
model into completely weathered,
partially weathered and
fresh rock is applied by
triangulated surfaces interpreted
from the logging of the
drill samples. This division
is only applied for density
and reporting purposes.
================================== ================================================================
Discussion of basis Uranium grade distribution
for using or not using exhibits a strong positive
grade cutting or capping. skewness, so a top cut
was applied to reduce local
bias by extreme grades
outliers around the 97.5
population percentile.
The domains were assessed
independently and a top
cut grade was determined
for each domain.
================================== ================================================================
The process of validation, Validation of the MRE included
the checking process visual inspection of the
used, the comparison grade distribution compared
of model data to drill to the drill data, comparison
hole data, and use of of block model statistics
reconciliation data to the sample statistics
if available. and generation of swath
plots. These confirmed
that the MRE appropriately
represents the grade and
tonnage distribution of
the uranium mineralisation
at the confidence levels
reported.
================================== ================================================================
Moisture Whether the tonnages The resource tonnage is
are estimated on a dry reported on a dry bulk
basis or with natural density basis. In-situ
moisture, and the method dry bulk density measurements
of determination of were completed on dry DD
the moisture content. core and using a solid
pycnometer method for RC
samples. Sample grades
are reported using dry
weight. No moisture content
of DD core has been determined.
================================== ================================================================
Cut-off The basis of the adopted The MRE has been reported
parameters cut-off grade(s) or using a 200ppm U(3) O(8)
quality parameters applied. cut-off grade. Recent feasibility
studies on adjacent properties
have demonstrated that
a 100ppm U(3) O(8) cut-off
is economic. Based on the
current uranium market,
reporting of the MRE at
a 200 ppm cut-off grade
is both justifiable and
consistent with previous
published MRE's for this
style of mineralisation.
================ ================================== ================================================================
Mining Assumptions made regarding The DFS demonstrated that
factors possible mining methods, the Zona 7 resource can
or assumptions minimum mining dimensions potentially be extracted
and internal (or, if using open pit mining methods,
applicable, external) with the recovery of uranium
mining dilution. It through the application
is always necessary of acid heap leach methods.
as part of the process Indicative parameters used
of determining reasonable for pit optimisation purposes
prospects for eventual in recent DFS are:
economic extraction Uranium selling price:
to consider potential US$50 to US$65/lb U(3)
mining methods, but O(8) ,
the assumptions made Total Mining Cost: US$4.0/lb
regarding mining methods U(3) O(8)
and parameters when Mining recovery: 95%
estimating Mineral Resources Mining dilution: 5%
may not always be rigorous. Plant Process Cost: US$9.0/lb
Where this is the case, U(3) O(8)
this should be reported Recovery U(3) O(8) : 85%
with an explanation Royalties: 1.2%
of the basis of the Selling costs: 1.5%
mining assumptions made.
================ ================================== ================================================================
Metallurgical The basis for assumptions Metallurgical testwork
factors or predictions regarding on representative samples
or assumptions metallurgical amenability. across a range of ore types
It is always necessary has been undertaken for
as part of the process Zona 7. The results of
of determining reasonable this testwork showed the
prospects for eventual mineralisation to be amenable
economic extraction to convention acid heap
to consider potential leach, with uranium recoveries
metallurgical methods, in the order of 85% with
but the assumptions a low acid consumption
regarding metallurgical of 12-18 kg/t.
treatment processes
and parameters made
when reporting Mineral
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 Assumptions made regarding It is planned that all
factors possible waste and process spent heap leach (ripios)
or assumptions residue disposal options. material will be returned
It is always necessary to the open pit which will
as part of the process be lined so as to encapsulate
of determining reasonable the ripios. Any Naturally
prospects for eventual Occurring Radioactive Material
economic extraction (NORM) or Acid Rock Drainage
to consider the potential (ARD) waste will also be
environmental impacts stored within the lined
of the mining and processing pit.
operation. While at An Environmental Scoping
this stage the determination Study will serve to define
of potential environmental the scope and content of
impacts, particularly the Environmental and Social
for a greenfields project, Impact Assessment.
may not 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. Bulk density values were
If assumed, the basis derived from 800 solid--fluid
for the assumptions. pycnometer measurements.
If determined, the method These values have been
used, whether wet or validated with DD core
dry, the frequency of bulk density results obtained
the measurements, the using the water immersion
nature, size and method. The in-situ dry
representativeness bulk density values are:
of the samples. Completely weathered: 2.28
g/cm(3)
Partially weathered: 2.40
g/cm(3)
Fresh rock: 2.64 g/cm(3)
The bulk density values
have been updated from
those previously used in
the October 2015 MRE based
on a 50% increase in bulk
density data. The values
shown above have been used
to estimate tonnages for
the updated domain 6. Bulk
density values used for
domains 2, 3 and 4 are
unchanged from those used
in the April 2014 MRE,
those used for domain 5
are from October 2015.
================================== ================================================================
The bulk density for Fresh and slightly weathered
bulk material must have rock is competent enough
been measured by methods to ensure the method used
that adequately account takes into account any
for void spaces (vugs, rock porosity. A factor
porosity, etc), moisture derived from comparison
and differences between with DD core was used to
rock and alteration adjust the weathered material.
zones within the deposit.
================================== ================================================================
Discuss assumptions The density measurements
for bulk density estimates have been classified by
used in the evaluation weathering intensity, defined
process of the different by the geological logging.
materials. Three dominant zones have
been identified, namely:
completely weathered; partially
weathered; and fresh rock.
The average of the density
data from each zone was
applied in the resource
model.
================ ================================== ================================================================
Classification The basis for the classification The reported MRE has been
of the Mineral Resources classified as Measured,
into varying confidence Indicated and Inferred
categories. after consideration of
the following:
* Adequate geological evidence and drill hole sampling
is available to assume geological and grade
continuity.
* Adequate in-situ dry bulk density data is available
to estimate appropriate tonnage factors.
* Adequate mining, metallurgy and processing knowledge
to imply potential prospect for eventual economic
extraction.
================================== ================================================================
Whether appropriate The reported MRE has been
account has been taken classified with consideration
of all relevant factors of the quality and reliability
(ie relative confidence of the raw data, the confidence
in tonnage/grade estimations, of the geological interpretation,
reliability of input the number, spacing and
data, confidence in orientations of intercepts
continuity of geology through the mineralised
and metal values, quality, zones and knowledge of
quantity and distribution grade continuity gained
of the data). from observations and geostatistical
analysis.
================================== ================================================================
Whether the result appropriately The reported MRE and its
reflects the Competent classification are consistent
Person's view of the with the Competent Person
deposit. (CP) view of the deposit.
The CP was responsible
for determining the resource
classification.
================ ================================== ================================================================
Audits The results of any audits Berkeley has undertaken
or reviews or reviews of Mineral a review of the previous
Resource estimates. MRE and concluded that
the estimate was developed
using industry standard
methods and that the estimate
was considered to reflect
the understanding of the
geology and grade continuity.
Malcolm Titley (CP, Geology
Consultant, Maja Mining
Limited) reviewed the reported
MRE and concluded that
the estimate appropriately
represents the grade and
tonnage distribution of
uranium mineralisation
at confidence levels commensurate
with the Indicated resource
classification.
================================== ================================================================
Discussion Where appropriate a The confidence level is
of relative statement of the relative reflected in the resource
accuracy/ accuracy and confidence classification category
confidence level in the Mineral chosen for the reported
Resource estimate using MRE. The definition of
an approach or procedure Indicated and Inferred
deemed appropriate by Mineral Resources is appropriate
the Competent Person. for the level of study
For example, the application and the geological confidence
of statistical or geostatistical imparted by the drilling
procedures to quantify grid.
the relative accuracy The reported MRE is considered
of the resource within appropriate and representative
stated confidence limits, of the grade and tonnage
or, if such an approach at the 200ppm U(3) O(8)
is not deemed appropriate, cut-off grade. The application
a qualitative discussion of geostatistical methods
of the factors that has helped to increase
could affect the relative the confidence of the model
accuracy and confidence and quantify the relative
of the estimate. accuracy of the resource
on a global scale. It relies
on historical data being
of similar standard as
recent infill drilling.
The relevant tonnages and
grade are variable on a
local scale and have been
simulated using UC and
LUC for SMU dimensions
of 5m by 5m by 6m for Domain
6.
The CP considers that the
current drilling grid is
sufficient for classification
of the Mineral Resource
as Measured, Indicated
or Inferred.
================================== ================================================================
The statement should The Zona 7 deposit is likely
specify whether it relates to have local variability.
to global or local estimates, The global assessment is
and, if local, state an indication of the average
the relevant tonnages, tonnages and grade estimate
which should be relevant for each geological domain.
to technical and economic
evaluation. Documentation
should include assumptions
made and the procedures
used.
================================== ================================================================
These statements of No production has been
relative accuracy and carried out at Zona 7.
confidence of the estimate
should be compared with
production data, where
available.
================ ================================== ================================================================
Section 4 Estimation and Reporting of Ore Reserves
(Criteria listed in section 1, and where relevant in sections 2
and 3, also apply to this section.)
Criteria JORC Code explanation Commentary
================ ====================================== ============================================================
Mineral Description of the Mineral A mineral resource has been
Resource Resource estimate used estimated using block modelling
estimate as a basis for the conversion techniques as describes
for conversion to an Ore Reserve. in Section 3 of Table 1.
to Ore A block model of 5x5x6 m
Reserves has been created and the
resource estimated using
Ordinary Krigging and Uniform
Conditioning.
Zona 7 Mineral Resource
at 125 ppm mining cut off
==================================== ============================================================
Clear statement as to The mineral resource estimate
whether the Mineral is inclusive of any ore
Resources are reported reserves
additional to, or inclusive
of, the Ore Reserves.
================== ==================================== ============================================================
Site visits Comment on any site Site visits took place from
visits undertaken by 9(th) to 12(th) of November
the Competent Person 2015. The following inspections
and the outcome of those were made:
visits. * The site of the pit
* The site of the proposed dump sites
* The site of the proposed plant site including the ore
stockpile
* The core yard where cores were inspected
* The access to the site and existing infrastructure
around the site.
No material issues that
are likely to prevent the
establishment of mining
and processing activities
at the site were identified
during the site visit.
==================================== ============================================================
If no site visits have Site visits have been undertaken.
been undertaken indicate
why this is the case.
================== ==================================== ============================================================
Study The type and level of The level of study is Definitive
Status study undertaken to Feasibility Study. Only
enable Mineral Resources measured and indicated resources
to be converted to Ore have been considered in
Reserves. the declaration of ore reserves
==================================== ============================================================
The Code requires that All factors required to
a study to at least convert Resources to Reserves
Pre-Feasibility Study have been considered including
level has been undertaken capital and operating costs,
to convert Mineral Resources selling prices, geotechnical
to Ore Reserves. Such conditions, metallurgical
studies will have been recoveries and reagent consumptions,
carried out and will environmental and social
have determined a mine constrains, etc. These factors
plan that is technically were used to determine the
achievable and economically optimum economic pit shell
viable, and that material (using Whittle optimization
Modifying Factors have software). The optimal pit
been considered. shell was used as the basis
to design an open pit that
considers slope angles,
ramps and berms in the different
sectors of the pit. The
reserves reported are within
the final pit design. The
use of these factors has
resulted in a technically
and economically viable
plan.
==================================== ============================================================
Cut-off The basis of the cut-off Cut-off grade has been estimated
parameters grade(s) or quality using a combination of factors:
parameters applied * Different selling price: from 45$/lb to 65$/lb
* Mine costs derived from the analysis of 5 different
proposals from mining contractors.
* Recoveries and acid consumption obtained from
metallurgical testwork done at Mintek (South Africa)
for 6 m columns.
* Rehabilitation costs.
The cut-off grade applied
is 125 ppm
==================================== ============================================================
Mining The method and assumptions A mine design to definitive
factors used as reported in feasibility study levels
or assumptions the Pre-Feasibility of accuracy has been undertaken
or Feasibility Study as the basis for the estimation
to convert Mineral Resource of Ore Reserves. This study
to an Ore Reserve (i.e. has included:
either by application * Exploration and sampling of the deposit
of appropriate factors
by optimisation or by
preliminary or detailed * Modelling and estimation of mineral resources
design).
* Mine design of an open pit including a pit
optimization study
* Design of all dumps and stockpiles required.
* Metallurgical testwork
* Metallurgical process and plant design
* Determination and design of all infrastructure
requirements
* Costing based on multiple quotes
* Financial evaluation by discounted cashflow analysis
==================================== ============================================================
The choice, nature and The deposit is shallow (between
appropriateness of the 0 to 100m) and massive,
selected mining method(s) the pre-strip is therefore
and other mining parameters low with a stripping ratio
including associated 1.13 (t to t). Due to the
design issues such as depth and geometry of the
pre-strip, access, etc. deposit, the selected mining
method is Open Pit mining
ensureing a good recovery
of the deposit. Some of
the pre-strip material will
be used as construction
material. Access to the
pit will be by conventional
open pit ramps, 25m in width
that enables access for
100 t trucks.
==================================== ============================================================
The assumptions made Geotechnical design parameters
regarding geotechnical have been derived for the
parameters (eg pit slopes, various material types encountered
stope sizes, etc), grade at the site based on core
control and pre-production logging and laboratory test
drilling. work. Open pit slopes have
been divided into different
design sectors and each
of them has specific conditions
applied. Overall slope angles
in the identified design
sectors range from 46 degrees
to 56 degrees.
Grade control will be done
based on two main sources
of data:
* Portable XRF on blast hole collected dust and rock
chips
* Blast hole chemical assay
Routine XRF testing will
provide the basic information
for ore grade control in
the ore. The cost for these
activities has been considered
as part of the labour cost
of the Berkeley technical
services.
The blast hole samples will
be collected as 6 m composites.
Face mapping and geological
logging are used to confirm
the results. It has been
assumed that 30% of the
total ore samples and 10%
of the waste samples will
be sent to the laboratory
for the first year as part
of a QA / QC process for
the gamma probing. After
first year, only 10% of
ore blast holes and 5% of
waste blast holes will be
collected for chemical analysis.
==================================== ============================================================
The major assumptions A Pit optimisation study
made and Mineral Resource was undertaken the techno-economic
model used for pit and data set used in this optimisation
stope optimisation (if process were largely based
appropriate). on the outcomes of the pre-feasibility
study with the exception
of the geotechnical parameters
which were determine to
DFS levels of accuracy.
==================================== ============================================================
The mining dilution Planned dilution of Zona
factors used. 7 was applied through regularisation
of the block model. The
original resource model
produced by CSA was populated
with minimum block sizes
of 5x5x1.5. The block model
was then regularised to
5x5x6 to account for the
selective mining unit. In
addition to this, dilution
of 4% and mining recovery
of 95% was applied to account
for unplanned dilution due
to blast movement, mixing
of ore and waste and mining
angles.
==================================== ============================================================
The mining recovery Mining recovery factor used
factors used. is 95%
==================================== ============================================================
Any minimum mining widths SMU is 5x5x6m, minimum width
used. for mining is established
in 30m
==================================== ============================================================
The manner in which No Inferred material is
Inferred Mineral Resources used in the study, all reserves
are utilised in mining estimated are based on measured
studies and the sensitivity and indicated resources.
of the outcome to their
inclusion.
==================================== ============================================================
The infrastructure requirements The infrastructure required
of the selected mining is minimum: access by road,
methods. power and water. The mining
infrastructure cluster will
be provided by the selected
mining contractor. A metallurgical
process plant will be constructed.
==================================== ============================================================
Metallurgical The metallurgical process The heap leach process is
factors proposed and the appropriateness proposed followed by SX
or assumptions of that process to the and ADU precipitation. The
style of mineralisation. ADU precipitate (yellowcake)
is calcined to produce U3O8.
The high recoveries obtained
from testwork (93% including
a scale-up factor of 2%)
and the low acid consumption
makes heap leaching the
preferred process route.
Ore, when crushed, breaks
along the fractures where
the uranium minerals occur,
hence milling or fine crushing
is not required. The 40mm
liberation size is achieved
with only primary and secondary
crushing. Acid leaching
has been demonstrated to
be the preferred process.
Tank leaching, although
increasing recovery by 2-3%,
has significantly higher
capital and operational
costs, and so is economically
a less attractive process
than heap leaching.
==================================== ============================================================
Whether the metallurgical The process method selected
process is well-tested is the standard method for
technology or novel mineralogically similar
in nature. uranium ores. A number of
mines world-wide operate
utilising heap leaching
with sulphuric acid. The
plant recoveries achieved
are typically similar to
the results predicted by
the testwork.
==================================== ============================================================
The nature, amount and Testwork was carried out
representativeness of using 1-metre and 6-metre
metallurgical test work high columns. Samples used
undertaken, the nature for the 6m column tests
of the metallurgical were made up from 12 sub-composites,
domaining applied and which were combined into
the corresponding metallurgical 3 composites, depending
recovery factors applied. on ore type. These composites
are considered to be representative
of these ore types. Overall
uranium recoveries reported
are weighted averages of
the dissolutions achieved
in 6m column testwork, multiplied
by the proportion of ore
represented by the sample,
multiplied by a scale-up
factor of 98%. This factor
is reasonable.
==================================== ============================================================
Any assumptions or allowances At this stage, no deleterious
made for deleterious elements have been identified
elements. as being of economic significance.
==================================== ============================================================
The existence of any Samples used for the 6m
bulk sample or pilot column tests were made up
scale test work and from 12 sub-composites,
the degree to which which were combined into
such samples are considered 3 composites, depending
representative of the on ore type. These composites
orebody as a whole. are considered to be representative
of these ore types. The
6m column tests are accepted
as being pilot scale tests.
==================================== ============================================================
For minerals that are The product mineralogy does
defined by a specification, not depend on the minerals
has the ore reserve in the ore, due to after
estimation been based the leaching process, all
on the appropriate mineralogy soluble uranium is precipitated
to meet the specifications? as U(3) O(8.)
==================================== ============================================================
Environmental The status of studies Environmental Impact Assesment
of potential environmental has been done and is ready
impacts of the mining to be submitted to the authorities.
and processing operation. Impacts identified are compatible
Details of waste rock with environment.
characterisation and Waste rock characterization
the consideration of has been done. Studies has
potential sites, status been performed with Golder
of design options considered Associates Ibérica
and, where applicable, and AGQ laboratories. Caracterization
the status of approvals studies are based on Spanish
for process residue and European Union legislation,
storage and waste dumps summarized in two main decrees:
should be reported. * Real Decreto 975/2009
* Real Decreto 777/2012
These two decrees require
testwork to be performed
to categorize the waste,
38 samples distributed along
orebody divided in 6 possible
wastes based on lithology
and weathering has been
tested.
Waste has been divided into:
* Inert: comprising Tertiary cover and conglomerates,
and Completely Weathered lithologies with less than
40ppm of U3O8.
* Non-Inert: all the lithologies with more than 40ppm
U3O8 and the Partially Weathered and Unweathered
materials.
One waste dump has been
considered for each of the
two previous type of wastes.
Non-inert waste will need
a liner as waste dump floor
while Inert waste only need
a conventional preparation
based on topsoil removal
and base compaction.
Waste dumps approved by
the Exploitation Project.
Detailed project for waste
dump will be finalize before
operation starts
==================================== ============================================================
Infrastructure The existence of appropriate Road, power line and communications
infrastructure: availability are available.
of land for plant development, Land acquisition has begun
power, water, transportation although only 15.4Ha have
(particularly for bulk been acquired from 202Ha.
commodities), labour, It is not expected difficulties
accommodation;or the to reach amicable agreements
ease with which the with the current landowners
infrastructure can be for the rest. If any, the
provided, or accessed. law allow the company for
the force expropriation
of the land.
The project location is
not remote and accommodation
can be done in all villages
and towns around
================== ==================================== ============================================================
Costs The derivation of, or Capital costs have been
assumptions made, regarding estimated through the issue
projected capital costs of detailed enquiries to
in the study. multiple contractors and
the receipt of formal proposals
by possible suppliers or
contractors.
==================================== ============================================================
The methodology used Mining operational cost
to estimate operating have been calculated from
costs. formal proposals from 5
possible contractors.
Of the 5 proposals, one
has been discarded because
of elevated rates. The other.
4 of them are in a very
close range and the selected
one is the lowest. The different
between the lowest and the
average of the 4 low range
contractors is less than
10%.
Processing cost have been
estimated based on consumptions
obtained from testwork and
engineering design, and
proposals received from
suppliers of the different
commodities. Man-power was
estimated based on similar
operations and cost based
on a benchmarking of this
cost in other operations
in country.
==================================== ============================================================
Allowances made for Deleterious elements were
the content of deleterious analysed in the ore, in
elements. the PLS and in the obtained
product, and non-deleterious
elements were found at levels
that could penalize the
product
==================================== ============================================================
Any assumptions or allowances N/A
made for deleterious
elements.
==================================== ============================================================
The source of exchange Consensus of different analysts
rates used in the study.
==================================== ============================================================
Derivation of transportation Estimated based on proposals
charges. of courier companies
==================================== ============================================================
The basis for forecasting Estimated based on the industry
or source of treatment standards
and refining charges,
penalties for failure
to meet specification,
etc.
==================================== ============================================================
The allowances made 1% Royalty is payable to
for royalties payable, Anglo Pacific Group, Plc
both Government and and 0.375% royalty is payable
private. to Resource Capital Fund.
25% on benefits has been
considered as a fix tax
in Spain.
==================================== ============================================================
Revenue The derivation of, or Projected U(3) O(8) concentrate
factors assumptions made regarding quality is consistent with
revenue factors including the results of metallurgical
head grade, metal or test work data completed
commodity price(s) exchange for the project, compared
rates, transportation against standard product
and treatment charges, specifications at converters.
penalties, net smelter Uranium revenues are based
returns, etc. on the latest published
long term contract pricing
forecasts (LT mid-range)
from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030. The
company considers this a
conservative estimate of
long term prices, with analyst
consensus forecasts reaching
US$65 per pound long term.
Commercialisation costs
of 1% have been applied
to gross revenues to reflect
transportation costs, insurances
and commissions.
All prices are based on
2016 constant United States
dollars.
==================================== ============================================================
The derivation of assumptions U(3) O(8) pricing forecasts
made of metal or commodity are based on the latest
price(s), for the principal published long term contract
metals, minerals and pricing forecasts (LT mid-range)
co-products. from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030.
==================================== ============================================================
Market The demand, supply and The uranium market is currently
assessment stock situation for characterised by high inventory
the particular commodity, levels, oversupply and depressed
consumption trends and demand levels, largely due
factors likely to affect to the ongoing effects of
supply and demand into the Fukushima disaster in
the future. Japan in 2011 which resulted
in the closure of all Japanese
nuclear reactors. The spot
uranium price has fallen
in response, and most mines
are currently operating
at or near marginal cost,
with significant production
now coming off stream by
higher cost producers. A
major increase in demand
is expected from China and
India where large scale
reactor build programs are
ongoing. Analyst consensus
forecast is for the uranium
market to turn into deficit
around 2021/2022 when price
recovery is expected to
increase significantly to
the analyst consensus long
term incentive price of
US$65/lb.
==================================== ============================================================
A customer and competitor Customers are expected to
analysis along with originate from the US, Asia
the identification of (in particular China, Japan
likely market windows and India) and Europe and
for the product. will either be large nuclear
utilities or trading houses.
The company is currently
in discussions with numerous
global utilities and trading
houses regarding off-take
contracts and is confident
that demand will exist for
its product from the commencement
of production and throughout
the life of mine.
==================================== ============================================================
Price and volume forecasts Uranium revenues are based
and the basis for these on the latest published
forecasts. long term contract pricing
forecasts (LT mid-range)
from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030. The
company considers this a
conservative estimate of
long term prices, with analyst
consensus forecasts reaching
US$65 per pound long term.
Volume sold averages 3.5X
m lbs per annum over the
life of mine and is based
on the Company's expectations
that sufficient demand exists
from Asian, US and European
customers for such material.
==================================== ============================================================
For industrial minerals Not applicable
the customer specification,
testing and acceptance
requirements prior to
a supply contract.
==================================== ============================================================
Economic The inputs to the economic The Salamanca Project is
analysis to produce made up of the Retortillo,
the net present value Santidad, Zona 7 and Alameda
(NPV) in the study, sites. Although the ore
the source and confidence reserves discussed in this
of these economic inputs Table 1 represent the Retortillo
including estimated and Santidad sites only
inflation, discount the project has been evaluated
rate, etc. as a whole and the following
information relating to
the financial evaluation
represents the input parameters
and results for the entire
project.
The after-tax NPV of the
projected cash flows is
US$531.94 million at an
8-percent (real) discount
rate.
The after-tax internal rate-of-return
is 60 percent.
Capital is projected to
be committed beginning in
2017.
All costs and prices are
based on 2016 constant United
States dollars (zero inflation
assumed).
Up-front Capital Costs
Mining & mine related facilities
= US$22.4 million (US$9.9
million for Retortillo,
US$6.1 million for Zona
7 and US$6.3 million for
Alameda)
Processing & plant related
infrastructure = US$197.1
million (US$78.7 million
for Retortillo, US$50.3
million for Zona 7 and US$68.1
million for Alameda)
Other capex including G&A
= US$ 15.1 million (US$7.1
million for Retortillo,
US$2.7 million for Zona
7 and US$5.3 million for
Alameda)
Up-front capital costs =
US$.95.7 million
A contingency of 6% applied
to capex requirements for
all Project facilities.
Production (tons)
Total Tonnes Mined over
Life-of-Mine = 61.3 million
(16.1 million tonnes at
Retortillo, 18.8 million
tonnes at Zona 7 and 26.5
million tonnes at Alameda)
Plant recovery = 87% for
Retortillo, 93% for Zona
7, and 82% for Alameda
Life of Mine = 13.75 years
Average Production Steady
State = 4.4 million pounds
U(3) 0(8)
Average Life of Mine Production
= 3.5 million pounds U(3)
0(8)
Total U(3) 0(8) Produced
Life-of-Mine = 48.6 million
pounds
Start of Construction =
2017
Start of Production = 2018
Cash flow
Average Sales Price Received
= US$52 per pound
Average Cash Operating Costs
= US$15.4 per pound
Average Annual Operating
Earnings before
Interest, Taxes, Depreciation
and
Amortization (EBITDA) (steady
state) = US$144.8
million
NPV = $531.94 million
Internal rate of return
(IRR) = 60%
==================================== ============================================================
NPV ranges and sensitivity The sensitivity study shows
to variations in the the NPV at the 8-percent
significant assumptions (real) discount rate when
and inputs. Base Case annual production
tonnages, sales prices,
operating costs and capital
costs are increased and
decreased in increments
of 5 percent within a +/-10-percent
range. Minus 10% NPV (US$ '000)
----------------- ---------------
Production
(pounds U(3)
O(8) ) 431
----------------- ---------------
Sales price 431
----------------- ---------------
Operating costs 561
----------------- ---------------
Capital costs 554
----------------- ---------------
Minus 5%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 482
----------------- ---------------
Sales price 482
----------------- ---------------
Operating costs 547
----------------- ---------------
Capital costs 543
----------------- ---------------
Base Case
----------------- ---------------
Production
(pounds U(3)
O(8) ) 532
----------------- ---------------
Sales price 532
----------------- ---------------
Operating costs 532
----------------- ---------------
Capital costs 532
----------------- ---------------
Plus 5%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 582
----------------- ---------------
Sales price 582
----------------- ---------------
Operating costs 517
----------------- ---------------
Capital costs 521
----------------- ---------------
Plus 10%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 632
----------------- ---------------
Sales price 632
----------------- ---------------
Operating costs 502
----------------- ---------------
Capital costs 510
----------------- ---------------
==================================== ============================================================
Social The status of agreements An Exploitation plan was
with key stakeholders submitted to the regulatory
and matters leading body, the review of which
to social licence to included a public consultation.
operate. All stakeholders were asked
to provide comments on the
project. A number of questions
were raised and all of them
answered. After the review
of the questions and the
answers and after the review
of all the documents shown
by the company, the project
was authorised by relevant
mining legislation. The
Nuclear Safety Council has
authorised the conceptual
project and is reviewing
the additional information
to authorise the plant construction.
================== ==================================== ============================================================
Other To the extent relevant, At Zona 7 202 Ha are needed
the impact of the following to develop the project.
on the project and/or A total of 15.4 Ha has already
on the estimation and been purchased as part of
classification of the the project site and for
Ore Reserves: changing with other landowners.
==================================== ============================================================
Any identified material N/A
naturally occurring
risks.
==================================== ============================================================
The status of material N/A
legal agreements and
marketing arrangements.
==================================== ============================================================
The status of governmental The key authorisation aspects
agreements and approvals of the project comprise:
critical to the viability * Mining and environmental: Exploitation Project
of the project, such submitted
as mineral tenement
status, and government
and statutory approvals. * Water uses: Not initiated
There must be reasonable
grounds to expect that
all necessary Government * Land use: Not initiated
approvals will be received
within the timeframes
anticipated in the Pre-Feasibility * Radiological protection: Not initiated
or Feasibility study.
Highlight and discuss
the materiality of any
unresolved matter that
is dependent on a third
party on which extraction
of the reserve is contingent.
==================================== ============================================================
Classification The basis for the classification Measured mineral resources
of the Ore Reserves have been classified as
into varying confidence Proven ore reserves while
categories. Indicated mineral resources
have been classified as
Probable ore reserves.
==================================== ============================================================
Whether the result appropriately It is the view of the Competent
reflects the Competent Person that the outcomes
Person's view of the of the feasibility study
deposit. undertaken appropriately
reflect the nature and potential
of the deposit to be developed,
viable exploitation is considered
feasible.
==================================== ============================================================
The proportion of Probable All Measured mineral resources
Ore Reserves that have have been converted to Proven
been derived from Measured ore reserves.
Mineral Resources (if
any).
==================================== ============================================================
Audits The results of any audits Cameron Mining has done
or reviews or reviews of Ore Reserve a review of the mining aspects
estimates. of the project, focusing
on scheduling and pit shell
selection. For processing
purposes Randall Schiefeld
and Russell Bradford have
provided a general review,
focusing first of them on
heap leaching and second
on general structure of
the project.
================== ==================================== ============================================================
Discussion Where appropriate a The confidence level is
of relative statement of the relative reflected in the resource
accuracy/ accuracy and confidence classification category
confidence level in the Ore Reserve chosen for the reported
estimate using an approach OR. The definition of current
or procedure deemed Ore Reserves is appropriate
appropriate by the Competent for the level of study and
Person. For example, the geological confidence
the application of statistical imparted by the drilling
or geostatistical procedures grid.
to quantify the relative The reported OR is considered
accuracy of the reserve appropriate and representative
within stated confidence of the grade and tonnage
limits, or, if such at the 125ppm U(3) O(8)
an approach is not deemed cut-off grade.
appropriate, a qualitative
discussion of the factors
which could affect the
relative accuracy and
confidence of the estimate.
==================================== ============================================================
The statement should Minor amounts of inferred
specify whether it relates resources have been unavoidably
to global or local estimates, included into the mine plan.
and, if local, state These resources are mined
the relevant tonnages, late in the mine life, an
which should be relevant evaluation of the effect
to technical and economic of these resources on the
evaluation. Documentation economic outcome of the
should include assumptions project has demonstrated
made and the procedures that the effect is minor
used. and does not affect the
project outcome. The inferred
resources have NOT been
converted to ore reserves.
==================================== ============================================================
Accuracy and confidence It is considered that all
discussions should extend modifying factors applied
to specific discussions to generate the ore reserve
of any applied Modifying estimates have been developed
Factors that may have to a level of accuracy required
a material impact on to support a feasibility
Ore Reserve viability, study.
or for which there are
remaining areas of uncertainty
at the current study
stage.
==================================== ============================================================
It is recognised that No production has been carried
this may not be possible out at Zona 7.
or appropriate in all
circumstances. These
statements of relative
accuracy and confidence
of the estimate should
be compared with production
data, where available.
================== ==================================== ============================================================
JORC Code, 2012 Edition - Table 1 Report (Retortillo)
Section 1 Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria JORC Code explanation Commentary
================== ========================================= ======================================
Sampling Nature and quality of The Retortillo deposits
techniques sampling (eg cut channels, were sampled using Diamond
random chips, or specific Drill (DD), Open Hole (OH)
specialised industry and Reverse Circulation
standard measurement (RC) holes on a spacing
tools appropriate to varying between 50m x 50m
the minerals under investigation, and 35m x 35m. A total of
such as down hole gamma 396 DD, 63 OH and 646 RC
sondes, or handheld XRF holes for 74,099m were drilled.
instruments, etc). These Most holes were vertical.
examples should not be Berkeley DD core was sampled
taken as limiting the using 0.3-2.5m intervals
broad meaning of sampling. in the mineralised zones,
allowing for 2m of internal
low grade or waste. In addition,
the sampling was extended
3-5m up and down hole from
the interpreted mineralised
zone. Half or quarter core
was used for sampling.
Berkeley RC drill samples
are collected over 1m intervals
and split on site using
two riffle splitters in
cascade to provide an approximately
3-5kg sample. In rare cases,
wet samples are split using
a cone and quarter method.
Field tests show that both
methods produce representative
samples.
Junta de Energía Nuclear
(JEN) and Empresa Nacional
de Uranio (ENUSA) DD core
was sampled using 0.25m,
0.50m and 1m intervals in
the mineralised zones, with
0.25m intervals being the
most frequent sample length.
ENUSA RC drill samples were
collected over 1m intervals.
Splitting method is unknown.
========================================= ======================================
Include reference to Berkeley sampling protocols
measures taken to ensure include the insertion of
sample representivity standards and blanks into
and the appropriate calibration the sample stream to assess
of any measurement tools the accuracy, precision
or systems used. and methodology of the external
laboratories used. In addition,
field duplicate samples
are inserted to assess the
variability of the uranium
mineralisation. 15-20% of
samples were for quality
control purposes. The laboratories
undertake duplicate sampling
as part of their internal
Quality Assurance/Quality
Control (QA/QC) processes.
Analysis of the QA/QC sample
data indicates satisfactory
performance of both the
field sampling protocols
and assay laboratories procedures,
indicating acceptable levels
of precision and accuracy.
Berkeley drill hole collar
locations were surveyed
by qualified surveyors (Cubica
Ingeniería Metrica,
S.L.) using differential
global positioning system
(DGPS) equipment achieving
sub decimetre accuracy in
horizontal and vertical
position. Down-hole surveys
were undertaken using a
Geovista down-hole deviation
probe. Measurements are
taken every 1cm down hole
and averaged every 10m.
No strongly magnetic rocks
are present within the deposit
which may affect magnetic
based readings. JEN and
ENUSA maps used local grid
coordinates which required
transformation and georeferencing.
Historic collar coordinates
were extracted from the
referenced maps and transformed
to UTM coordinates. Berkeley
re-assigned the elevation
to each collar.
Berkeley owns two down-hole
gamma probes. Both probes
are sent to Borehole Wireline
Pty. Ltd. in South Australia
for annual recalibration
in the Adelaide-model test
pits. Calibration includes
the determination of k-factor,
deadtime, bore hole diameter
and fluid corrections, which
are reported in the "Primary
Probe Calibration" document.
All parameters are then
applied during the in-house
equivalent grade (eU(3)
O(8) ) calculation process.
JEN and ENUSA QA/QC protocols
are unknown.
========================================= ======================================
Aspects of the determination Berkeley RC drill samples
of mineralisation that are collected over 1m intervals
are Material to the Public and split on site using
Report. In cases where cone and quarter method
'industry standard' work (previous campaigns) or
has been done this would two riffle splitters in
be relatively simple cascade (2014 campaign)
(eg 'reverse circulation to provide an approximate
drilling was used to 3-5kg field sample.
obtain 1 m samples from Scintillometer measurements
which 3 kg was pulverised were taken on all Berkeley
to produce a 30 g charge RC samples and this data
for fire assay'). In was then used to select
other cases more explanation the samples to be sent to
may be required, such external laboratories for
as where there is coarse sample preparation and analysis.
gold that has inherent Mineralised intervals determined
sampling problems. Unusual from scintillometer values
commodities or mineralisation greater than 150cps were
types (eg submarine nodules) extended up and down hole
may warrant disclosure by at least 2-5m to ensure
of detailed information. adequate definition of waste
boundaries.
Field samples were split
in the core shed using a
riffle splitter to 0.7-1kg
and sent to ALS and AGQ
laboratories for preparation
(Seville, Spain) and analysis
(Loughrea, Ireland and Vancouver,
Canada). Samples were dried,
crushed down to 70% below
2mm and pulverised with
at least 85% of the sample
passing 75um. 10g of sample
was used for uranium analysis
by pressed powder X-ray
fluorescence (XRF) method.
During 2006 to 2008 samples
were sent to Actlabs Canada
for Delayed Neutron Counting
(DNC) analysis. Since 2008
ALS laboratories with pressed
powder XRF analysis have
been used. The percentage
of samples analysed at ActLabs
and ALS is 22% to 43% of
the total assay database
respectively. JEN and ENUSA
core samples were prepared
in internal company laboratories
and assayed for uranium
using XRF, Atomic absorption
spectroscopy (AAS) or fluorometric
methods. The JEN and ENUSA
assay data represents 35%
of the total assay database.
================== ========================================= ======================================
Drilling Drill type (eg core, Berkeley drilling comprised
techniques reverse circulation, both DD (HQ) and RC drilling
open-hole hammer, rotary using a 140mm diameter face
air blast, auger, Bangka, sampling hammer.
sonic, etc) and details For angled DD, oriented
(eg core diameter, triple core was achieved using
or standard tube, depth a plasticine method (previous
of diamond tails, face-sampling campaigns) and DeviCore
bit or other type, whether measurements (2014 campaign).
core is oriented and The historical JEN and ENUSA
if so, by what method, drilling comprised both
etc). DD (NQ) and RC drilling
using a 114mm diameter face
sampling hammer. Historical
drilling accounts for approximately
25% of the total drilling.
================== ========================================= ======================================
Drill Method of recording and Berkeley, JEN and ENUSA
sample assessing core and chip DD typically recorded overall
recovery sample recoveries and core recoveries in excess
results assessed. of 90%, which is considered
acceptable.
Berkeley RC drill samples
are collected over 1m intervals
through a cyclone. Plastic
sample bags are strapped
to the cyclone to maximise
sample recovery. Individual
sample bags were not weighed
to assess sample recovery
but a visual inspection
was made by the Company
geologist to ensure all
samples are of approximately
equivalent volume.
ENUSA RC drill sample collection
method is unknown.
========================================= ======================================
Measures taken to maximise The DD drilling rigs used
sample recovery and ensure face discharge bits to ensure
representative nature a low contact between the
of the samples. rock and drilling fluids,
minimising ore washing.
Core was cut using a water
lubricated diamond saw with
care taken to ensure minimal
ore loss.
The RC drilling rigs utilised
suitably sized compressors
to ensure dry samples where
possible. Plastic sample
bags were strapped to the
cyclone to maximise sample
recovery. Sample logs record
whether the sample was dry,
moist or wet.
Wet samples account for
approximately 10-15% and
typically correspond to
the last 5-10m of the affected
holes.
========================================= ======================================
Whether a relationship Due to potential solubility
exists between sample and mobility of the uranium
recovery and grade and minerals, the use of water
whether sample bias may in core recovery in DD is
have occurred due to controlled.
preferential loss/gain The core and RC sample recoveries
of fine/coarse material. are of an acceptable level
and no bias is expected
from any sample losses.
================== ========================================= ======================================
Logging Whether core and chip Berkeley geological logging
samples have been geologically of DD core included recording
and geotechnically logged descriptions of lithology,
to a level of detail geological period, colour,
to support appropriate oxidation, mineralisation
Mineral Resource estimation, style, alteration, weathering,
mining studies and metallurgical structure, texture, grain
studies. size and mineralogy.
Berkeley geotechnical logging
of DD core included recording
descriptions of integrity
(recovery and RQD), materials
(lithology, rock strength
and depth oxide staining),
structures (type, angle,
contact type, infill, weathering)
Berkeley structural logging
of DD core included recording
descriptions of structure
type, structural angles,
contact type, infill, line
type and slip direction.
Berkeley alteration logging
of DD core included recording
descriptions of metamorphic
textures, alteration mineralogy
and mineralisation style.
Berkeley geological logging
of RC chip samples included
recording descriptions of
lithology, weathering, alteration
and mineralisation. A scintillometer
reading of counts per second
(cps) was recorded for each
1m sample (quantitative).
JEN geological logging includes
recording descriptions of
lithology, Fe oxides, sulphides,
uranium mineralogy fracturing
and no recovering zones.
ENUSA geological logging
includes recording descriptions
of lithology, colour, fracturing
level, recovery, mineralogy,
radiometry and water table.
========================================= ======================================
Whether logging is qualitative Geological logging is qualitative
or quantitative in nature. in nature.
Core (or costean, channel, Berkeley DD core boxes and
etc) photography. samples and RC samples and
chip trays were photographed.
JEN and ENUSA did not take
photographs of drill core
or chip trays.
========================================= ======================================
The total length and All DD and RC drill holes
percentage of the relevant were logged in full by geologists
intersections logged. employed by the relevant
companies.
================== ========================================= ======================================
Sub-sampling If core, whether cut Berkeley DD core was sampled
techniques or sawn and whether quarter, using 0.3-2.5m intervals
and sample half or all core taken. in the mineralised zones,
preparation including areas of internal
low grade or waste. The
majority of samples were
1m in length (60%), with
33% being greater than 1m
in length and 7% less than
1m in length. In addition,
the sampling was extended
3-5m up and down hole from
the interpreted mineralised
zone. Half or quarter core
was used for sampling, with
the majority (74%) being
quarter core.
JEN and ENUSA DD core was
sampled using 0.25m, 0.50m
and 1m intervals in the
mineralised zones, with
0.25m intervals being the
most frequent sample length.
Whole core was used for
sampling.
========================================= ======================================
If non-core, whether Berkeley RC drill samples
riffled, tube sampled, were collected at 1m intervals.
rotary split, etc. and RC intervals were sampled
whether sampled wet or by splitting dry samples
dry. in the field to 3-5kg using
cone and quarter method
(previous campaigns) or
two riffle splitters in
cascade (2014 campaign)
and further split in the
core shed to 0.7-1kg using
a riffle splitter.
Where samples were wet they
were dried prior to splitting.
In rare cases, wet samples
were split using a cone
and quarter method.
ENUSA RC drill samples were
collected at 1m intervals.
The sampling method used
is unknown.
========================================= ======================================
For all sample types, Berkeley samples were sent
the nature, quality and to ALS laboratories for
appropriateness of the preparation and analysis.
sample preparation technique. Samples were dried, fine
crushed down to 70% below
2mm, and pulverised with
at least 85% of the sample
passing 75um. 10g of sample
was used for uranium analysis
by pressed powder XRF method.
During 2006 to 2008 samples
were sent to Actlabs Canada
for DNC analysis. Since
2008, ALS laboratories with
pressed powder XRF analysis
have been used. These methods
are considered appropriate
for this style of uranium
mineralisation.
JEN and ENUSA core samples
were prepared and assayed
for uranium at internal
company laboratories using
XRF, AAS or fluorometric
methods.
========================================= ======================================
Quality control procedures Berkeley field tests determined
adopted for all sub-sampling that the sample size and
stages to maximise representivity method of sampling produce
of samples. representative RC samples.
QA/QC procedures involved
the use of standards and
blanks which were inserted
into sample batches at a
frequency of approximately
15-20%.
Quality control procedures
used by JEN and ENUSA are
unknown.
========================================= ======================================
Measures taken to ensure Duplicate splits of RC samples
that the sampling is were taken every 10m down
representative of the hole within the sampled
in situ material collected, intervals by Berkeley. The
including for instance results from these duplicates
results for field duplicate/second-half show acceptable repeatability.
sampling. Some indications of inhomogeneity
were observed in a small
proportion (<10%) of duplicates.
========================================= ======================================
Whether sample sizes The uranium is typically
are appropriate to the very fine grained. Previous
grain size of the material test work carried out by
being sampled. Berkeley using different
sample sizes demonstrated
that the selected sample
size is appropriate.
================== ========================================= ======================================
Quality The nature, quality and Berkeley assayed samples
of assay appropriateness of the for uranium using the DNC
data assaying and laboratory method during the 2006 to
and laboratory procedures used and whether 2008 drilling campaigns
tests the technique is considered and pressed powder XRF during
partial or total. subsequent drilling campaigns.
These analytical methods
report total uranium content.
JEN and ENUSA assayed samples
for uranium were completed
at internal company laboratories
using XRF, AAS or fluorometric
methods.
The sampling and analytical
methods used by Berkeley,
JEN and ENUSA are considered
appropriate for this style
of uranium mineralisation.
========================================= ======================================
For geophysical tools, Down-hole gamma logging
spectrometers, handheld was undertaken for all probe
XRF instruments, etc, accessible holes drilled
the parameters used in by Berkeley to provide eU(3)
determining the analysis O(8) ("equivalent" U(3)
including instrument O(8) grade) data. The down-hole
make and model, reading gamma response was converted
times, calibrations factors to eU(3) O(8) by correcting
applied and their derivation, for radon, hole diameter,
etc. air/water and a deconvolution
filter was also applied.
eU(3) O(8) data was used
in the mineral resource
grade estimation process
when chemical assay data
was not available. eU(3)
O(8) data was also used
to verify mineralisation
intersections based on assay
results.
========================================= ======================================
Nature of quality control Standards, blanks and duplicates
procedures adopted (eg were regularly inserted
standards, blanks, duplicates, into the sample stream by
external laboratory checks) Berkeley, with approximately
and whether acceptable 15-20% of all samples used
levels of accuracy (ie for quality control. The
lack of bias) and precision external laboratories maintain
have been established. their own process of QA/QC
utilising internal standards,
repeats and duplicates.
Review of the Berkeley quality
control samples, as well
as the external laboratory
quality QA/QC reports, has
shown no sample preparation
issues, acceptable levels
of accuracy and precision
and no bias in the analytical
datasets.
JEN and ENUSA used internal
company laboratories. No
QA/QC data is available
for this historic data.
A review of the JEN and
ENUSA mineralisation intercepts
compared to Berkeley infill
drilling shows no bias between
the two data sets.
================== ========================================= ======================================
Verification The verification of significant Reported significant intersections
of sampling intersections by either were checked and verified
and assaying independent or alternative by Senior Geological management.
company personnel.
========================================= ======================================
The use of twinned holes. Berkeley completed a program
of RC twin holes to compare
with the JEN and ENUSA results.
The results show good correlation
of uranium grade and mineralisation
thickness between the twinned
holes.
========================================= ======================================
Documentation of primary All primary data was recorded
data, data entry procedures, in templates designed by
data verification, data Berkeley. Assay data from
storage (physical and the external laboratory
electronic) protocols. is received in spreadsheets
and downloaded directly
into an Access Database
managed by the Company.
Data is entered into controlled
excel templates for validation.
The validated data is then
loaded into a password secured
relational database by a
designated Company geologist.
Daily backups of all digital
data are undertaken. These
procedures are documented
in the Berkeley Technical
Procedures and Protocols
manual.
JEN and ENUSA primary paper
data was digitalized and
recoded following the Berkeley
protocols. The validated
data was then loaded into
the password secured relational
database by a designated
Company geologist.
========================================= ======================================
Discuss any adjustment Uranium (ppm) assays received
to assay data. from the external laboratory
were converted to U(3) O(8)
(ppm) using the stoichiometric
factor of 1.179.
================== ========================================= ======================================
Location Accuracy and quality Berkeley drill hole collar
of data of surveys used to locate locations were surveyed
points drill holes (collar and by qualified surveyors (Cubica
down-hole surveys), trenches, Ingeniería Metrica
mine workings and other S.L) using standard DGPS
locations used in Mineral equipment achieving sub
Resource estimation. decimetre accuracy in horizontal
and vertical position.
Berkeley down-hole surveys
were undertaken using a
Geovista down-hole deviation
probe. Measurements were
taken every 1cm down hole
and averaged every 10m.
No strongly magnetic rocks
are present within the deposit
which may affect magnetic
based readings.
JEN and ENUSA holes were
drilled on grid coordinates
and were not surveyed after
drilling.
========================================= ======================================
Specification of the The grid system is ETRS
grid system used. 1989 UTM Zone 29N.
========================================= ======================================
Quality and adequacy Topographic control was
of topographic control. based on a digital terrain
model with sub metric accuracy
sourced from the Spanish
Geographical Institute (Instituto
Geográfico Nacional)
and was verified by comparison
with drill hole collar surveys
completed by the surveyor
using DGPS.
================== ========================================= ======================================
Data Data spacing for reporting The majority of the Berkeley
spacing of Exploration Results. drilling was undertaken
and distribution on a nominal 50m by 50m
grid, with closer spaced
drilling on 35m by 35m within
open pit areas scheduled
to be mined during the initial
two years of production
based on the Pre-Feasibility
Study (PFS).
Section lines are orientated
approximately perpendicular
to the interpreted strike
of the mineralisation.
The historical JEN and ENUSA
drilling was completed on
spaced 50m by 50m grid with
some infill areas spaced
35m by 35m.
========================================= ======================================
Whether the data spacing The data spacing (notionally
and distribution is sufficient 35m by 35m) is considered
to establish the degree sufficient to verify geological
of geological and grade and grade continuity, and
continuity appropriate allow the estimation of
for the Mineral Resource Measured and Indicated Mineral
and Ore Reserve estimation Resources.
procedure(s) and classifications
applied.
========================================= ======================================
Whether sample compositing No compositing of RC samples
has been applied. in the field has been undertaken.
================== ========================================= ======================================
Orientation Whether the orientation The mineralisation at Retortillo
of data of sampling achieves covers a 6km sub-vertical
in relation unbiased sampling of syncline structure with
to geological possible structures and the dominant strike direction
structure the extent to which this being SE-NW. Despite the
is known, considering general dip of the host
the deposit type. geological units and structures
ranging from 50-70deg, the
mineralised zone is interpreted
to be sub-horizontal (due
to post mineralisation supergene
processes) to shallowly
dipping to the SE.
========================================= ======================================
If the relationship between The majority of DD and RC
the drilling orientation drill holes are vertical.
and the orientation of Due to the interpreted flat
key mineralised structures lying nature of the mineralisation,
is considered to have no sampling bias is considered
introduced a sampling to have been introduced
bias, this should be by the orientation of the
assessed and reported drilling. This has been
if material. validated by the drilling
of 50 inclined DD holes
and 25 inclined RC holes.
================== ========================================= ======================================
Sample The measures taken to Chain of custody is managed
security ensure sample security. by Berkeley. Samples were
transported from the drill
site by Company vehicle
to a sample preparation
shed where samples were
prepared for dispatch. Samples
were sent directly from
the sample preparation shed
to the laboratory using
a certified courier or a
Berkeley owned vehicle authorised
for radioactive materials
transport. No other freight
was transported with the
samples which were taken
directly from the Berkeley
facility to the external
laboratory. Sample submission
forms were sent in paper
form with the samples as
well as electronically to
the laboratory. Reconciliation
of samples occurred prior
to commencement of sample
preparation for assaying.
The historical drilling
samples were prepared and
analysis using internal
company laboratories. The
chain of custody is unknown.
================== ========================================= ======================================
Audits The results of any audits Sampling techniques and
or reviews or reviews of sampling procedures, as well as QA/QC
techniques and data. data, are reviewed internally
an ongoing basis. Malcolm
Titley (Competent Person
(CP), Geology Consultant,
Maja Mining Limited) has
independently reviewed the
sampling techniques, procedures
and data. He has undertaken
a number of site visits
to review and inspect the
application of procedures.
These reviews have concluded
that the sampling and analytical
results have resulted in
data suitable for incorporation
into Mineral 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 Type, reference name/number, The Retortillo deposits
tenement location and ownership lie on the Exploitation
and land including agreements Concession (Mining Licence)
tenure or material issues with CE 6605-10 which is 100%
status third parties such as owned by Berkeley Minera
joint ventures, partnerships, España S.L., a wholly
overriding royalties, owned subsidiary of Berkeley
native title interests, Energia Limited.
historical sites, wilderness The Exploitation Concession
or national park and is valid for an initial
environmental settings. period of 30 years and may
be renewed for two additional
periods of 30 years. It
covers an area of 25.2km(2)
and includes the entire
area containing the Retortillo
mineralisation.
No historical sites or national
parks are located within
the Concession.
=============================== ======================================
The security of the Tenure in the form of an
tenure held at the time Exploitation Concession
of reporting along with has been granted and is
any known impediments considered secure. There
to obtaining a licence are no known impediments
to operate in the area. to obtaining a licence to
operate in this area.
================== =============================== ======================================
Exploration Acknowledgment and appraisal Previous exploration at
done of exploration by other Retortillo was completed
by other parties. initially by JEN and ENUSA,
parties both Spanish state run companies,
from the late 1950's through
to the mid 1980's. Work
completed by JEN and ENUSA
included mapping, radiometric
surveys, trenching, RC and
DD drilling.
A detailed data assessment
and verification of the
historical data supplied
by JEN and ENUSA has been
undertaken by Berkeley.
No significant issues with
the data were detected.
================== =============================== ======================================
Geology Deposit type, geological The uranium mineralisation
setting and style of is hosted within Ordovician
mineralisation. metasediments adjacent to
granite. The mineralisation
typically occurs as a sub-horizontal
to shallowly dipping layer
occurring between surface
and 90m depth. The style
of the uranium mineralisation
includes veins, stockwork
and disseminated mineralisation
in joint/fracture filling
associated with brittle
deformation. Uraninite and
coffinite are the primary
uranium minerals. Secondary
uranium mineralisation is
developed in "supergene-like"
tabular zones corresponding
to the depth of weathering.
Most of the mineralisation
is hosted within totally
and partially weathered
metasediment. This deposit
falls into the category
defined by the International
Atomic Energy Association
(IAEA) as Vein Type, Sub
Type Iberian Type.
================== =============================== ======================================
Drill A summary of all information No additional drilling data
hole material to the understanding is available. All drilling
Information of the exploration results data has been presented
including a tabulation in previous ASX releases,
of the following information with the most recent being
for all Material drill April 2015.
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 No changes have been made
this information is to any of the drilling data
justified on the basis reported in previous ASX
that the information releases. The purpose of
is not Material and this release is presentation
this exclusion does of an update to the mineral
not detract from the resource estimate based
understanding of the on improved definition of
report, the Competent the mineral resource at
Person should clearly the selected mining unit
explain why this is block size of 5 x 5 x 6m
the case. (X x Y x Z).
================== =============================== ======================================
Data In reporting Exploration Previously reported drill
aggregation Results, weighting averaging intersections are based
methods techniques, maximum on chemical assay data and
and/or minimum grade are calculated using a 200ppm
truncations (eg cutting U(3) O(8) cut-off, no high
of high grades) and grade cut, and may include
cut-off grades are usually up to 2m of internal dilution.
Material and should
be stated.
=============================== ======================================
Where aggregate intercepts High grade intervals that
incorporate short lengths are internal to broader
of high grade results zones of uranium mineralisation
and longer lengths of are reported as included
low grade results, the intervals.
procedure used for such
aggregation should be
stated and some typical
examples of such aggregations
should be shown in detail.
=============================== ======================================
The assumptions used No metal equivalent values
for any reporting of were used.
metal equivalent values
should be clearly stated.
================== =============================== ======================================
Relationship These relationships All drilling was planned
between are particularly important in such a way as to intersect
mineralisation in the reporting of expected mineralisation
widths Exploration Results. in a perpendicular manner.
and intercept If the geometry of the The uranium mineralisation
lengths mineralisation with is interpreted to be flat
respect to the drill lying to shallowly dipping
hole angle is known, so all of the RC holes were
its nature should be drilled vertically.
reported.
=============================== ======================================
If it is not known and The reported down-hole intervals
only the down hole lengths are interpreted to approximate
are reported, there true widths.
should be a clear statement
to this effect (eg 'down
hole length, true width
not known').
================== =============================== ======================================
Diagrams Appropriate maps and Appropriate diagrams, including
sections (with scales) a drill plan and cross sections,
and tabulations of intercepts are included in the main
should be included for body of this release.
any 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 Where comprehensive No new exploration results
reporting reporting of all Exploration are available. All drilling
Results is not practicable, and other information has
representative reporting been reported in previous
of both low and high ASX releases.
grades and/or widths
should be practiced
to avoid misleading
reporting of Exploration
Results.
================== =============================== ======================================
Other Other exploration data, Down-hole gamma logging
substantive if meaningful and material, of all Berkeley holes was
exploration should be reported including undertaken to provide eU(3)
data (but not limited to): O(8) data. Comparison of
geological observations; eU(3) O(8) data with chemical
geophysical survey results; assay data have shown that
geochemical survey results; on average eU(3) O(8) tends
bulk samples - size to underestimate at higher
and method of treatment; grades (>500ppm) and overestimate
metallurgical test results; at lower grades (<200ppm).
bulk density, groundwater, The Mineral Resource Estimate
geotechnical and rock (MRE) reported in this release
characteristics; potential was estimated using chemical
deleterious or contaminating assay data as the primary
substances. method for grade estimation
in the modelling process.
eU(3) O(8) data was used
for grade estimation process
when chemical assay data
was not available.
The Company has reported
the results of a PFS for
the Salamanca Project which
includes the Retortillo
deposits (refer ASX Announcement
dated 26 September 2013).
The PFS included hydrogeological,
geotechnical, mining, metallurgical
and process engineering
studies, as well as environmental
impact assessments.
================== =============================== ======================================
Further The nature and scale Further work planned for
work of planned further work the Retortillo deposits
(eg tests for lateral includes additional infill
extensions or depth drilling focused on improving
extensions or large-scale geological confidence and
step-out drilling). resource classification
of open pit areas scheduled
to be mined post the initial
two years of production
(based on the PFS).
Geological studies will
include detailed interpretation
of lithology, structure
and weathering and an assessment
of potential relationships
between these factors and
uranium grade distribution.
Further work is also planned
on a number of other exploration
targets within the Retortillo
Region.
=============================== ======================================
Diagrams clearly highlighting N/A
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 the preceding section also apply to this
section.)
Criteria JORC Code explanation Commentary
================ ================================== ================================================================
Database Measures taken to ensure Drill hole data is stored
integrity that data has not been in a password protected
corrupted by, for example, relational database (Access).
transcription or keying Drill data recorded in digital
errors, between its Excel templates is transferred
initial collection and to the database by the project
its use for Mineral geologist who is responsible
Resource estimation for reviewing and validating
purposes. the data. Assay data is
received from the external
laboratories in digital
format and is loaded directly
into the database after
QA/QC has been checked and
validates the rest of assays.
Geological logging is restricted
to appropriate codes relevant
to the local geology, mineralisation,
weathering and alteration
setting. A copy of the master
database is linked to Surpac
mining software for Mineral
Resource Estimation.
================================ ================================================================
Data validation procedures Database validation checks
used. including collar survey
position, down hole survey
control, assay limits, eU(3)
O(8) profiles, sample intervals
and logging codes are completed
prior to the data being
transferred to the master
database.
================== ================================ ================================================================
Site visits Comment on any site Sampling techniques and
visits undertaken by procedures, as well as QA/QC
the Competent Person data, are reviewed internally
and the outcome of those an ongoing basis. Malcolm
visits. Titley, (CP, Geology Consultant,
Maja Mining Limited) has
reviewed the sampling techniques,
procedures, data and resource
estimation methodology.
He has undertaken a number
of site visits, the latest
being in August 2015, to
review and inspect the application
of these procedures. He
concludes that the sampling
and analytical results available
are appropriate for estimation
of the Mineral Resource.
================================ ================================================================
If no site visits have Site visits have been undertaken.
been undertaken indicate
why this is the case.
================== ================================ ================================================================
Geological Confidence in (or conversely, The confidence of the geological
interpretation the uncertainty of) interpretation is appropriate
the geological interpretation for the current level of
of the mineral deposit. resource estimation. The
resource is defined within
mineralised envelopes which
encompass all zones of significant
mineralisation.
================================ ================================================================
Nature of the data used Geology and mineralisation
and of any assumptions interpretation is based
made. on geological logging and
sample assays derived from
RC and DD drilling, along
with cross sectional interpretations
which include surface mapping
information and geophysical
studies.
================================ ================================================================
The effect, if any, Structural studies show
of alternative interpretations dips of structures vary
on Mineral Resource between 50deg and 80deg
estimation. however; the uranium mineralisation
has undergone supergene
remobilisation and is interpreted
to be flat lying to shallowly
dipping and generally within
100m from surface.
================================ ================================================================
The use of geology in On the deposit scale the
guiding and controlling uranium grade is controlled
Mineral Resource estimation. by both lithology and structure,
while on a local scale the
grade is interpreted to
be influenced by supergene
processes.
================================ ================================================================
The factors affecting Geological logging and uranium
continuity both of grade assay of samples from drill
and geology. holes has demonstrated the
continuity of the grade
and lithology between mineralised
sections. Breaks in continuity
are likely due to structural
offsets, some of which have
been observed or interpreted
from surface mapping.
================== ================================ ================================================================
Dimensions The extent and variability The main deposit (including
of the Mineral Resource a small satellite zone)
expressed as length covers an area of approximately
(along strike or otherwise), 3km by 0.6km. A second smaller
plan width, and depth deposit to the NW covers
below surface to the an area of approximately
upper and lower limits 2.3km by 0.2km. The mineralisation
of the Mineral Resource. at both deposits generally
occurs within 100m of surface.
================================ ================================================================
Estimation The nature and appropriateness A mineralised envelope is
and modelling of the estimation technique(s) created encompassing all
techniques applied and key assumptions, zones of significant mineralisation.
including treatment A number of different domains
of extreme grade values, have been interpreted based
domaining, interpolation on a broad mineralisation
parameters and maximum envelope at a nominal cut-off
distance of extrapolation of 40ppm U(3) O(8) .
from data points. If Geostatistical variogram
a computer assisted modelling was used to determine
estimation method was appropriate parameters for
chosen include a description estimation of uranium grade
of computer software using Ordinary Kriging (OK)
and parameters used. (for all Domains) followed
by the application of Uniform
Conditioning (UC) and Local
Uniform Conditioning (LUC)
using Isatis Software, in
order to simulate the grade
tonnage distribution based
on a Selective Mining Unit
(SMU) of 5m x 5m x 6m for
all Domains.
Surpac software was used
for mineralisation volume
interpretation and Isatis
for uranium grade estimation.
Four sources of drillhole
uranium grade data was used,
the proportions of data
within the mineralised volume
by length are:
* Chemical U(3) O(8) (ppm): 56.3%
* Radiometric Equivalent (ppm): 30.6%
* Portable XRF (ppm): 0.8%
* Background waste values based on XRF and Gamma probe
results (10ppm U(3) O(8) ): 12.3%
A number of holes which
were used to determine the
mineralisation volume were
excluded from the grade
estimation process. These
consisted of 32 JEN holes
where the radiometric equivalent
value indicated mineralisation
but the eU(3) O(8) value
was composited over the
entire mineralisation length,
resulting in these holes
being unsuitable for local
grade estimation.
The drill hole spacing is
nominally 50m by 50m, with
infill spacing at 35m by
35m within the Measured
Resource areas and part
of the Indicated Resource.
Eight mineralisation domains
were identified at Retortillo
(R2, R3, R4, R5, R6, R7,
S1 and S2). 1m samples composites
were used to estimate grade
into 20m by 20m by 6m parent
blocks with 5m by 5m by
6m blocks used for UC selectivity
conditioning.
In order to reduce local
bias due to extreme high
grades, top cuts were applied:
* R2: 1,100ppmU(3) O(8)
* R3: 1,800ppmU(3) O(8)
* R4: not applied
* R5: 3,800ppmU(3) O(8)
* R6: 2,000ppmU(3) O(8)
* R7: not applied
* S1: 2,500ppmU(3) O(8)
* S2: 2,500ppmU(3) O(8)
Appropriate search volumes,
minimum and maximum sample
numbers and top cutting
strategy were used based
on the results of Kriging
Neighbourhood Analysis.
The variogram nugget % and
maximum ranges in the order
of major, semi-major and
minor per domain in meters
are presented below:
* R2: 31%/74/72/55
* R3: 18%/105/90/23
* R4: 36%/44/31/25 taken from R5 as insufficient data
* R5: 36%/44/31/25
* R6: 32%/79/50/109
* R7: 32%/79/50/109 taken from R6 as insufficient data
* S1: 31%/65/85/38
* S2: 30%/128/85/27
In-situ dry bulk densities
were assigned based on zones
of weathering intensity
and used to estimate tonnage.
================================ ================================================================
The availability of The current resource estimate
check estimates, previous was compared with the previous
estimates and/or mine resource estimate (April
production records and 2015) which was based on
whether the Mineral a more constrained mineralisation
Resource estimate takes envelope and Ordinary Kriging
appropriate account grade estimation with no
of such data. adjustment for mining selectivity.
The updated MRE has 4% less
tonnes with a 15% higher
grade for a 7% increase
in metal. This increase
in grade and metal was anticipated
as a result of modelling
the mineralisation using
increased selectivity at
the 200 ppm grade cut-off.
No mining production has
taken place at Retortillo.
================================ ================================================================
The assumptions made The resource model only
regarding recovery of estimates uranium.
by-products.
================================ ================================================================
Estimation of deleterious At this stage, there are
elements or other non-grade no deleterious elements
variables of economic or other non-grade variables
significance (eg sulphur identified as being of economic
for acid mine drainage significance at Retortillo.
characterisation).
================================ ================================================================
In the case of block The uranium grade is estimated
model interpolation, into the 20m (X) by 20m
the block size in relation (Y) by 6m (Z) blocks. This
to the average sample compares to the average
spacing and the search drill spacing of 35m by
employed. 35m in X and Y and an assumed
mining bench height of 6m.
UC and LUC were applied
to the model based on PFS
designed mining selectivity
at a block size of 5m x
5m x 6m.
================================ ================================================================
Any assumptions behind Selective mining unit dimensions
modelling of selective are based on using a blasting
mining units. and sampling pattern which
is around 5m x 5m combined
with open pit mining equipment
suitable for controlled
excavation on a 3 to 6m
mining flitch height, using
125 tonnes backhoe excavators
and 100 tonne dump trucks.
================================ ================================================================
Any assumptions about Uranium is the only economic
correlation between metals estimated in the
variables. current resource model.
================================ ================================================================
Description of how the Geological interpretation
geological interpretation controlled the volume of
was used to control the resource estimate by
the resource estimates. restricting the interpretation
of the mineralisation volume
and associated samples to
material with continuity
above a nominal 40ppm U(3)
O(8) grade.
The domains are based on
geology, structure and uranium
grade with defined zones
of mineralisation that show
continuity along and across
strike.
A further division of the
model into completely weathered,
partially weathered and
fresh rock is applied by
triangulated surfaces interpreted
from the logging of the
drill samples. This division
is only applied for density
purposes. There is no relationship
or boundary effect between
mineralisation and grade
and weathering intensity.
================================ ================================================================
Discussion of basis Uranium grade distribution
for using or not using exhibits a strong positive
grade cutting or capping. skewness, so a top cut was
applied to reduce local
bias by extreme grades outliers
- nominally approximating
the 97.5 population percentile.
The domains were assessed
independently and a top
cut grade was determined
for each domain.
================================ ================================================================
The process of validation, Validation of the MRE included
the checking process visual inspection of the
used, the comparison grade distribution compared
of model data to drill to the drill data, comparison
hole data, and use of of block model statistics
reconciliation data to the sample statistics
if available. and generation of swath
plots. These confirmed that
the MRE appropriately represents
the grade and tonnage distribution
of the uranium mineralisation
at the confidence levels
reported. A detailed review
of the mineralisation domains,
drilling data and resultant
grade model using Datamine
software was completed by
the CP, which compared favourably
with the estimate completed
using Surpac and Isatis
software.
================================ ================================================================
Moisture Whether the tonnages The resource tonnage is
are estimated on a dry reported on a dry bulk density
basis or with natural basis. In-situ dry bulk
moisture, and the method density measurements were
of determination of completed on dry core and
the moisture content. on RC material using a solid-fluid
pycnometer. Results were
corrected for moisture content.
Sample grades are reported
using dry weight.
================================ ================================================================
Cut-off The basis of the adopted The MRE has been reported
parameters cut-off grade(s) or using a 200ppm U(3) O(8)
quality parameters applied. cut-off grade. The Salamanca
Project PFS demonstrated
that a 100ppm U(3) O(8)
cut-off is economic. Based
on the current uranium market,
reporting of the MRE at
a 200ppm cut-off grade is
both justifiable and consistent
with previous published
MRE's for this style of
mineralisation.
================== ================================ ================================================================
Mining Assumptions made regarding The PFS demonstrated that
factors possible mining methods, the Retortillo resource
or assumptions minimum mining dimensions can potentially be extracted
and internal (or, if using open pit mining methods,
applicable, external) with the recovery of uranium
mining dilution. It through the application
is always necessary of acid heap leach methods.
as part of the process Indicative parameters used
of determining reasonable for pit optimisation purposes
prospects for eventual were:
economic extraction Uranium selling price: US$65/lb
to consider potential U(3) O(8) ,
mining methods, but Total Mining Cost: US$14.5/lb
the assumptions made U(3) O(8)
regarding mining methods Mining recovery: 95%
and parameters when Mining dilution: 4%
estimating Mineral Resources Plant Process Cost: US$12.8/lb
may not always be rigorous. U(3) O(8)
Where this is the case, Recovery U(3) O(8) : 85%
this should be reported Royalties: 1.2%
with an explanation
of the basis of the
mining assumptions made.
================== ================================ ================================================================
Metallurgical The basis for assumptions Berkeley has completed a
factors or predictions regarding number of metallurgical
or assumptions metallurgical amenability. testwork programs for Retortillo
It is always necessary as part of the scoping,
as part of the process PFS and definitive feasibility
of determining reasonable studies, including column
prospects for eventual leach tests at commercial
economic extraction height (6m). These tests
to consider potential have shown that heap leaching
metallurgical methods, can achieve uranium recoveries
but the assumptions of at least 85%.
regarding metallurgical
treatment processes
and parameters made
when reporting Mineral
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.
================== ================================ ================================================================
Environmen-tal Assumptions made regarding Berkeley was granted a Favourable
factors possible waste and process Declaration of Environmental
or assumptions residue disposal options. Impact ('Environmental Licence')
It is always necessary for Retortillo in October
as part of the process 2013 following submission
of determining reasonable of the Company's Environmental
prospects for eventual and Social Impact Assessment
economic extraction ('ESIA') together with the
to consider the potential Exploitation Plan and the
environmental impacts Reclamation and Closure
of the mining and processing Plan.
operation. While at The Company's waste management
this stage the determination and rehabilitation assumptions
of potential environmental were detailed in the ESIA
impacts, particularly and Reclamation and Closure
for a greenfields project, Plan.
may not always be well Spent ore from the on-off
advanced, the status heap leach pads ('ripios')
of early consideration will initially be stored
of these potential on the heap leach pads and
environmental subsequently backfilled
impacts should be reported. into isolated and lined
Where these aspects (clay layer and HDPE liner)
have not been considered areas within the mined pits
this should be reported on a continuous basis once
with an explanation sufficient space is available.
of the environmental Acid Rock Drainage (ARD)
assumptions made. and Natural Occurring Radioactive
Materials (NORM) waste will
be placed onto temporary
dumps designed with the
required isolation system
(clay layer and HDPE liner)
until the waste is backfilled
into the mined pits towards
the end of the mine life.
At the end of the mine life,
the entire volume of ripios,
ARD and NORM waste will
be fully encapsulated within
the mined pits, and the
surface rehabilitated as
per the existing profile
and vegetation.
================================ ================================================================
Bulk density Whether assumed or determined. Bulk density values were
If assumed, the basis derived from 477 core and
for the assumptions. solid fluid pycnometer measurements.
If determined, the method The in-situ dry bulk density
used, whether wet or values are:
dry, the frequency of * Completely weathered: 2.28g/cm(3)
the measurements, the
nature, size and
representativeness * Partially weathered: 2.39g/cm(3)
of the samples.
* Fresh rock: 2.62g/cm(3)
================================ ================================================================
The bulk density for Fresh and slightly weathered
bulk material must have rock is competent enough
been measured by methods to ensure the method used
that adequately account takes into account any rock
for void spaces (vugs, porosity. A factor derived
porosity, etc), moisture from comparison with DD
and differences between core was used to adjust
rock and alteration the weathered material.
zones within the deposit.
================================ ================================================================
Discuss assumptions The density measurements
for bulk density estimates have been classified by
used in the evaluation weathering intensity, defined
process of the different by the geological logging.
materials. Three dominant zones have
been identified - completely
weathered, partially weathered
and fresh rock. The average
of the density data from
each zone was applied in
the resource model.
================== ================================ ================================================================
Classification The basis for the The reported MRE has been
classification classified as Measured,
of the Mineral Resources Indicated or Inferred after
into varying confidence consideration of the following:
categories. * Adequate geological evidence and drill hole sampling
is available to imply geological and grade
continuity.
* Adequate in-situ dry bulk density data is available
to estimate appropriate tonnage factors.
* Adequate mining, metallurgy and processing knowledge
to imply potential prospect for eventual economic
extraction.
================================ ================================================================
Whether appropriate The reported MRE has been
account has been taken classified with consideration
of all relevant factors of the quality and reliability
(ie relative confidence of the raw data, the confidence
in tonnage/grade estimations, of the geological interpretation,
reliability of input the number and spacing of
data, confidence in intercepts through the mineralised
continuity of geology zones and knowledge of grade
and metal values, quality, continuity gained from observation
quantity and distribution and geostatistical analysis.
of the data).
================================ ================================================================
Whether the result The reported MRE and its
appropriately classification are consistent
reflects the Competent with the CP's view of the
Person's view of the deposit. The CP was responsible
deposit. for determining the resource
classification.
================== ================================ ================================================================
Audits The results of any audits An external review was undertaken
or reviews or reviews of Mineral by SRK on the MRE reported
Resource estimates. in July 2012. The review
concluded that the estimate
was considered to reflect
the understanding of the
geology and grade continuity.
Malcolm Titley (Geology
Consultant, Maja Mining
Limited) reviewed this and
the previous MRE reported
in April 2015 and concluded
that the estimates appropriately
represented the grade and
tonnage distribution of
uranium mineralisation at
confidence levels commensurate
with the reported resource
classification.
================================ ================================================================
Discussion Where appropriate a The confidence level is
of relative statement of the relative reflected in the resource
accuracy/ accuracy and confidence classification category
confidence level in the Mineral chosen for the reported
Resource estimate using MRE. The definition of current
an approach or procedure Mineral Resources is appropriate
deemed appropriate by for the level of study and
the Competent Person. the geological confidence
For example, the application imparted by the drilling
of statistical or grid.
geostatistical The reported MRE is considered
procedures to quantify appropriate and representative
the relative accuracy of the grade and tonnage
of the resource within at the 200ppm U(3) O(8)
stated confidence limits, cut-off grade. The application
or, if such an approach of geostatistical methods
is not deemed appropriate, has helped to increase the
a qualitative discussion confidence of the model
of the factors that and quantify the relative
could affect the relative accuracy of the resource
accuracy and confidence on a global scale. It relies
of the estimate. on historical data being
of similar standard as recent
infill drilling. The relevant
tonnages and grade are variable
on a local scale and have
been simulated using UC
and LUC for SMU dimensions
of 5m by 5m by 6m.
The CP considers that the
drilling grid in the area
that was the focus of the
2014 infill drilling campaign
is sufficient for classification
of a Measured Mineral Resource.
================================ ================================================================
The statement should The Retortillo deposits
specify whether it relates are likely to have local
to global or local estimates, variability. The global
and, if local, state assessment is an indication
the relevant tonnages, of the average tonnages
which should be relevant and grade estimate for each
to technical and economic geological domain.
evaluation. Documentation
should include assumptions
made and the procedures
used.
================================ ================================================================
These statements of No production has been carried
relative accuracy and out at Retortillo.
confidence of the estimate
should be compared with
production data, where
available.
================== ================================ ================================================================
Section 4 Estimation and Reporting of Ore Reserves
(Criteria listed in section 1, and where relevant in sections 2
and 3, also apply to this section.)
Criteria JORC Code explanation Commentary
================ ====================================== ============================================================
Mineral Description of the Mineral A mineral resource has been
Resource Resource estimate used estimated using block modelling
estimate as a basis for the conversion techniques as describes
for conversion to an Ore Reserve. in Section 3 of Table 1.
to Ore A block model of 5x5x6 m
Reserves has been created and the
resource estimated using
Ordinary Krigging and Uniform
Conditioning.
Retortillo Mineral Resource
at 110 ppm mining cut off
Santidad Mineral Resource
at 100 ppm mining cut off
==================================== ============================================================
Clear statement as to The mineral resource estimate
whether the Mineral is inclusive of any ore
Resources are reported reserves
additional to, or inclusive
of, the Ore Reserves.
================== ==================================== ============================================================
Site visits Comment on any site Site visits took place from
visits undertaken by 9(th) to 12(th) of November
the Competent Person 2015. The following inspections
and the outcome of those were made:
visits. * The site of the pit
* The site of the proposed dump sites
* The site of the proposed plant site including the ore
stockpile
* The core yard where cores were inspected
* The access to the site and existing infrastructure
around the site.
No material issues that
are likely to prevent the
establishment of mining
and processing activities
at the site were identified
during the site visit.
==================================== ============================================================
If no site visits have Site visits have been undertaken.
been undertaken indicate
why this is the case.
================== ==================================== ============================================================
Study The type and level of The level of study is Definitive
Status study undertaken to Feasibility Study. Only
enable Mineral Resources measured and indicated resources
to be converted to Ore have been considered in
Reserves. the declaration of ore reserves
==================================== ============================================================
The Code requires that All factors required to
a study to at least convert Resources to Reserves
Pre-Feasibility Study have been considered including
level has been undertaken capital and operating costs,
to convert Mineral Resources selling prices, geotechnical
to Ore Reserves. Such conditions, metallurgical
studies will have been recoveries and reagent consumptions,
carried out and will environmental and social
have determined a mine constrains, etc. These factors
plan that is technically were used to determine the
achievable and economically optimum economic pit shell
viable, and that material (using Whittle optimization
Modifying Factors have software). The optimal pit
been considered. shell was used as the basis
to design an open pit that
considers slope angles,
ramps and berms in the different
sectors of the pit. The
reserves reported are within
the final pit design. The
use of these factors has
resulted in a technically
and economically viable
plan.
==================================== ============================================================
Cut-off The basis of the cut-off Cut-off grade has been estimated
parameters grade(s) or quality using a combination of factors:
parameters applied * Different selling price: from 45$/lb to 65$/lb
* Mine costs derived from the analysis of 5 different
proposals from mining contractors.
* Recoveries and acid consumption obtained from
metallurgical testwork done at Mintek (South Africa)
for 6 m columns.
* Rehabilitation costs.
The cut-off grade applied
is 110ppm for the Retortillo
deposit and 100ppm for the
Santidad deposit.
==================================== ============================================================
Mining The method and assumptions A mine design to definitive
factors used as reported in feasibility study levels
or assumptions the Pre-Feasibility of accuracy has been undertaken
or Feasibility Study as the basis for the estimation
to convert Mineral Resource of Ore Reserves. This study
to an Ore Reserve (i.e. has included:
either by application * Exploration and sampling of the deposit
of appropriate factors
by optimisation or by
preliminary or detailed * Modelling and estimation of mineral resources
design).
* Mine design of an open pit including a pit
optimization study
* Design of all dumps and stockpiles required.
* Metallurgical testwork
* Metallurgical process and plant design
* Determination and design of all infrastructure
requirements
* Costing based on multiple quotes
* Financial evaluation by discounted cashflow analysis
==================================== ============================================================
The choice, nature and The deposit is shallow (between
appropriateness of the 0 to 140m) and massive,
selected mining method(s) the pre-strip is therefore
and other mining parameters low with a stripping ratio
including associated 2.2 (t to t). Due to the
design issues such as depth and geometry of the
pre-strip, access, etc. deposit, the selected mining
method is Open Pit mining
ensuring a good recovery
of the deposit. Some of
the pre-strip material will
be used as construction
material. Access to the
pit will be by conventional
open pit ramps, 25m in width
that enables access for
100 t trucks.
==================================== ============================================================
The assumptions made Geotechnical design parameters
regarding geotechnical have been derived for the
parameters (eg pit slopes, various material types encountered
stope sizes, etc), grade at the site based on core
control and pre-production logging and laboratory test
drilling. work. Open pit slopes have
been divided into different
design sectors and each
of them has specific conditions
applied. Overall slope angles
in the identified design
sectors range from 34 degrees
to 53 degrees.
Grade control will be done
based on two main sources
of data:
* Portable XRF on blast hole collected dust and rock
chips
* Blast hole chemical assay
Routine XRF testing will
provide the basic information
for ore grade control in
the ore. The cost for these
activities has been considered
as part of the labour cost
of the Berkeley technical
services.
The blast hole samples will
be collected as 6 m composites.
Face mapping and geological
logging are used to confirm
the results. It has been
assumed that 30% of the
total ore samples and 10%
of the waste samples will
be sent to the laboratory
for the first year as part
of a QA / QC process for
the gamma probing. After
first year, only 10% of
ore blast holes and 5% of
waste blast holes will be
collected for chemical analysis.
==================================== ============================================================
The major assumptions A Pit optimisation study
made and Mineral Resource was undertaken the techno-economic
model used for pit and data set used in this optimisation
stope optimisation (if process were largely based
appropriate). on the outcomes of the pre-feasibility
study with the exception
of the geotechnical parameters
which were determine to
DFS levels of accuracy.
==================================== ============================================================
The mining dilution Planned dilution of Retortillo
factors used. and Santidad was applied
through regularisation of
the block model. The original
resource model produced
by CSA was populated with
minimum block sizes of 5x5x1.5.
The block model was then
regularised to 5x5x6 to
account for the selective
mining unit. In addition
to this, dilution of 4%
and mining recovery of 95%
was applied to account for
unplanned dilution due to
blast movement, mixing of
ore and waste and mining
angles.
==================================== ============================================================
The mining recovery Mining recovery factor used
factors used. is 95%
==================================== ============================================================
Any minimum mining widths SMU is 5x5x6m, minimum width
used. for mining is established
as 30m
==================================== ============================================================
The manner in which No Inferred material is
Inferred Mineral Resources used in the study, all reserves
are utilised in mining estimated are based on measured
studies and the sensitivity and indicated resources.
of the outcome to their
inclusion.
==================================== ============================================================
The infrastructure requirements The infrastructure required
of the selected mining is minimum: access by road,
methods. power and water. The mining
infrastructure cluster will
be provided by the selected
mining contractor. A metallurgical
process plant will be constructed.
==================================== ============================================================
Metallurgical The metallurgical process The heap leach process is
factors proposed and the appropriateness proposed followed by SX
or assumptions of that process to the and ADU precipitation. The
style of mineralisation. ADU precipitate (yellowcake)
is calcined to produce U3O8.
The high recoveries obtained
from testwork (87% including
a scale-up factor of 2%)
and the low acid consumption
makes heap leaching the
preferred process route.
Ore, when crushed, breaks
along the fractures where
the uranium minerals occur,
hence milling or fine crushing
is not required. The 40mm
liberation size is achieved
with only primary and secondary
crushing. Acid leaching
has been demonstrated to
be the preferred process.
Tank leaching, although
increasing recovery by 2-3%,
has significantly higher
capital and operational
costs, and so is economically
a less attractive process
than heap leaching.
==================================== ============================================================
Whether the metallurgical The process method selected
process is well-tested is the standard method for
technology or novel mineralogically similar
in nature. uranium ores. A number of
mines world-wide operate
utilising heap leaching
with sulphuric acid. The
plant recoveries achieved
are typically similar to
the results predicted by
the testwork.
==================================== ============================================================
The nature, amount and Testwork was carried out
representativeness of using 1-metre and 6-metre
metallurgical test work high columns. Samples used
undertaken, the nature were composites from each
of the metallurgical of the mining areas (north-west,
domaining applied and central and south-east).
the corresponding metallurgical The samples used are considered
recovery factors applied. to be representative of
these mining areas. Overall
uranium recoveries reported
are weighted averages of
the dissolutions achieved
in 6m column testwork, multiplied
by the proportion of ore
represented by the sample,
multiplied by a scale-up
factor of 98%. This factor
is reasonable.
==================================== ============================================================
Any assumptions or allowances At this stage, no deleterious
made for deleterious elements have been identified
elements. as being of economic significance.
==================================== ============================================================
The existence of any The samples for 6 metre
bulk sample or pilot column tests were composites
scale test work and of each mining area. The
the degree to which samples used are considered
such samples are considered to be representative of
representative of the the respective mining areas.
orebody as a whole. The 6m column tests are
accepted as being pilot
scale tests.
==================================== ============================================================
For minerals that are The major uranium minerals
defined by a specification, in the orebody are uraninite
has the ore reserve and coffinite, accounting
estimation been based for more than 97% of the
on the appropriate mineralogy uranium content. The product
to meet the specifications? mineralogy does not depend
on the minerals in the ore,
due to after the leaching
process, all soluble uranium
is precipitated as U(3)
O(8)
==================================== ============================================================
Environmental The status of studies Environmental Impact Assessments
of potential environmental completed and approved by
impacts of the mining authorities
and processing operation. Waste rock characterization
Details of waste rock has been completed. Studies
characterisation and have been performed with
the consideration of Golder Associates Ibérica
potential sites, status and AGQ laboratories. Characterization
of design options considered studies are based on Spanish
and, where applicable, and European Union legislation,
the status of approvals summarized in two main decrees:
for process residue * Real Decreto 975/2009
storage and waste dumps
should be reported.
* Real Decreto 777/2012
Those two decrees urge to
perform testwork to define
50 samples distributed along
orebody divided in 15 possible
wastes and 4 possible ore
based on lithology and weathering
has been tested.
Waste has been divided into:
* Inert: comprising Tertiary cover, and Completely
Weathered lithologies with less than 40ppm of U3O8.
* Non-Inert: all the lithologies with more than 40ppm
U3O8 and the Partially Weathered and Unweathered
materials.
One waste dump has been
considered for each of the
two type of wastes. Non-inert
waste will need a liner
as waste dump floor while
Inert waste only need a
conventional preparation
based on topsoil removal
and base compaction.
Waste dumps approved by
the Exploitation Project.
Detailed design for waste
dump will be finalize before
operation starts.
==================================== ============================================================
Infrastructure The existence of appropriate Road, power line and communications
infrastructure: availability are available.
of land for plant development, Land acquisition has begun
power, water, transportation and it is not expected difficulties
(particularly for bulk to reach amicable agreements
commodities), labour, with the current landowners.
accommodation; or the Of the 927Ha to be acquired,
ease with which the 43.7Ha are currently owned
infrastructure can be by Berkeley.
provided, or accessed. The project location is
not remote and accommodation
can be done in all villages
and towns around.
================== ==================================== ============================================================
Costs The derivation of, or Capital costs have been
assumptions made, regarding estimated through the issue
projected capital costs of detailed enquiries to
in the study. multiple contractors and
the receipt of formal proposals
by possible suppliers or
contractors.
==================================== ============================================================
The methodology used Mining operational cost
to estimate operating have been calculated from
costs. formal proposals from 5
possible contractors.
Of the 5 proposals, one
has been discarded because
of elevated rates. The other.
4 of them are in a very
close range and the selected
one is the lowest. The different
between the lowest and the
average of the 4 low range
contractors is less than
10%.
Processing cost have been
estimated based on consumptions
obtained from testwork and
engineering design, and
proposals received from
suppliers of the different
commodities. Man-power was
estimated based on similar
operations and cost based
on a benchmarking of this
cost in other operations
in country.
==================================== ============================================================
Allowances made for Deleterious elements were
the content of deleterious analysed in the ore, in
elements. the PLS and in the obtained
product, and non-deleterious
elements were found at levels
that could penalize the
product-
==================================== ============================================================
Any assumptions or allowances N/A
made for deleterious
elements.
==================================== ============================================================
The source of exchange Consensus of different analysts
rates used in the study.
==================================== ============================================================
Derivation of transportation Estimated based on proposals
charges. of courier companies
==================================== ============================================================
The basis for forecasting Estimated based on the industry
or source of treatment standards
and refining charges,
penalties for failure
to meet specification,
etc.
==================================== ============================================================
The allowances made 1% Royalty is payable to
for royalties payable, Anglo Pacific Group, Plc
both Government and and 0.375% royalty is payable
private. to Resource Capital Fund.
25% on benefits has been
considered as a fix tax
in Spain.
==================================== ============================================================
Revenue The derivation of, or Projected U(3) O(8) concentrate
factors assumptions made regarding quality is consistent with
revenue factors including the results of metallurgical
head grade, metal or test work data completed
commodity price(s) exchange for the project, compared
rates, transportation against standard product
and treatment charges, specifications at converters.
penalties, net smelter Uranium revenues are based
returns, etc. on the latest published
long term contract pricing
forecasts (LT mid-range)
from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030. The
company considers this a
conservative estimate of
long term prices, with analyst
consensus forecasts reaching
US$65 per pound long term.
Commercialisation costs
of 1% have been applied
to gross revenues to reflect
transportation costs, insurances
and commissions.
All prices are based on
2016 constant United States
dollars.
==================================== ============================================================
The derivation of assumptions U(3) O(8) pricing forecasts
made of metal or commodity are based on the latest
price(s), for the principal published long term contract
metals, minerals and pricing forecasts (LT mid-range)
co-products. from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030.
==================================== ============================================================
Market The demand, supply and The uranium market is currently
assessment stock situation for characterised by high inventory
the particular commodity, levels, oversupply and depressed
consumption trends and demand levels, largely due
factors likely to affect to the ongoing effects of
supply and demand into the Fukushima disaster in
the future. Japan in 2011 which resulted
in the closure of all Japanese
nuclear reactors. The spot
uranium price has fallen
in response, and most mines
are currently operating
at or near marginal cost,
with significant production
now coming off stream by
higher cost producers. A
major increase in demand
is expected from China and
India where large scale
reactor build programs are
ongoing. Analyst consensus
forecast is for the uranium
market to turn into deficit
around 2021/2022 when price
recovery is expected to
increase significantly to
the analyst consensus long
term incentive price of
US$65/lb.
==================================== ============================================================
A customer and competitor Customers are expected to
analysis along with originate from the US, Asia
the identification of (in particular China, Japan
likely market windows and India) and Europe and
for the product. will either be large nuclear
utilities or trading houses.
The company is currently
in discussions with numerous
global utilities and trading
houses regarding off-take
contracts and is confident
that demand will exist for
its product from the commencement
of production and throughout
the life of mine.
==================================== ============================================================
Price and volume forecasts Uranium revenues are based
and the basis for these on the latest published
forecasts. long term contract pricing
forecasts (LT mid-range)
from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030. The
company considers this a
conservative estimate of
long term prices, with analyst
consensus forecasts reaching
US$65 per pound long term.
Volume sold averages 3.5X
m lbs per annum over the
life of mine and is based
on the Company's expectations
that sufficient demand exists
from Asian, US and European
customers for such material.
==================================== ============================================================
For industrial minerals Not applicable
the customer specification,
testing and acceptance
requirements prior to
a supply contract.
==================================== ============================================================
Economic The inputs to the economic The Salamanca Project is
analysis to produce made up of the Retortillo,
the net present value Santidad, Zona 7 and Alameda
(NPV) in the study, sites. Although the ore
the source and confidence reserves discussed in this
of these economic inputs Table 1 represent the Retortillo
including estimated and Santidad sites only
inflation, discount the project has been evaluated
rate, etc. as a whole and the following
information relating to
the financial evaluation
represents the input parameters
and results for the entire
project.
The after-tax NPV of the
projected cash flows is
US$531.94 million at an
8-percent (real) discount
rate.
The after-tax internal rate-of-return
is 60 percent.
Capital is projected to
be committed beginning in
2017.
All costs and prices are
based on 2016 constant United
States dollars (zero inflation
assumed).
Up-front Capital Costs
Mining & mine related facilities
= US$22.4 million (US$9.9
million for Retortillo,
US$6.1 million for Zona
7 and US$6.3 million for
Alameda)
Processing & plant related
infrastructure = US$197.1
million (US$78.7 million
for Retortillo, US$50.3
million for Zona 7 and US$68.1
million for Alameda)
Other capex including G&A
= US$ 15.1 million (US$7.1
million for Retortillo,
US$2.7 million for Zona
7 and US$5.3 million for
Alameda)
Up-front capital costs =
US$.95.7 million
A contingency of 6% applied
to capex requirements for
all Project facilities.
Production (tons)
Total Tonnes Mined over
Life-of-Mine = 61.3 million
(16.1 million tonnes at
Retortillo, 18.8 million
tonnes at Zona 7 and 26.5
million tonnes at Alameda)
Plant recovery = 87% for
Retortillo, 93% for Zona
7, and 82% for Alameda
Life of Mine = 13.75 years
Average Production Steady
State = 4.4 million pounds
U(3) 0(8)
Average Life of Mine Production
= 3.5 million pounds U(3)
0(8)
Total U(3) 0(8) Produced
Life-of-Mine = 48.6 million
pounds
Start of Construction =
2017
Start of Production = 2018
Cash flow
Average Sales Price Received
= US$52 per pound
Average Cash Operating Costs
= US$15.4 per pound
Average Annual Operating
Earnings before
Interest, Taxes, Depreciation
and
Amortization (EBITDA) (steady
state) = US$144.8
million
NPV = $531.94 million
Internal rate of return
(IRR) = 60%
==================================== ============================================================
NPV ranges and sensitivity The sensitivity study shows
to variations in the the NPV at the 8-percent
significant assumptions (real) discount rate when
and inputs. Base Case annual production
tonnages, sales prices,
operating costs and capital
costs are increased and
decreased in increments
of 5 percent within a +/-10-percent
range. Minus 10% NPV (US$ '000)
----------------- ---------------
Production
(pounds U(3)
O(8) ) 431
----------------- ---------------
Sales price 431
----------------- ---------------
Operating costs 561
----------------- ---------------
Capital costs 554
----------------- ---------------
Minus 5%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 482
----------------- ---------------
Sales price 482
----------------- ---------------
Operating costs 547
----------------- ---------------
Capital costs 543
----------------- ---------------
Base Case
----------------- ---------------
Production
(pounds U(3)
O(8) ) 532
----------------- ---------------
Sales price 532
----------------- ---------------
Operating costs 532
----------------- ---------------
Capital costs 532
----------------- ---------------
Plus 5%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 582
----------------- ---------------
Sales price 582
----------------- ---------------
Operating costs 517
----------------- ---------------
Capital costs 521
----------------- ---------------
Plus 10%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 632
----------------- ---------------
Sales price 632
----------------- ---------------
Operating costs 502
----------------- ---------------
Capital costs 510
----------------- ---------------
==================================== ============================================================
Social The status of agreements An Exploitation plan was
with key stakeholders submitted to the regulatory
and matters leading body, the review of which
to social licence to included a public consultation.
operate. All stakeholders were asked
to provide comments on the
project. A number of questions
were raised and all of them
answered. After the review
of the questions and the
answers and after the review
of all the documents shown
by the company, the project
was authorised by relevant
mining legislation. The
Nuclear Safety Council has
authorised the conceptual
project and is reviewing
the additional information
to authorise the plant construction.
================== ==================================== ============================================================
Other To the extent relevant,
the impact of the following
on the project and/or
on the estimation and
classification of the
Ore Reserves:
==================================== ============================================================
Any identified material N/A
naturally occurring
risks.
==================================== ============================================================
The status of material Consortium Agreement with
legal agreements and ENUSA (the tenement title
marketing arrangements. holder) signed and registered
in the official register
of mining rights of the
Ministry of Industry, in
which Berkeley is declared
the solely and exclusive
operator of the tenement.
Berkeley will only compensate
ENUSA with a royalty of
2.5% of the production.
==================================== ============================================================
The status of governmental Exploitation, rehabilitation
agreements and approvals and closure plans submitted
critical to the viability to the administration, as
of the project, such well as the Environmental
as mineral tenement Scoping Document, which
status, and government has been already processed,
and statutory approvals. with the feedback that there
There must be reasonable is nothing that may make
grounds to expect that the project non- compatible
all necessary Government with the existing environment
approvals will be received or protected areas.
within the timeframes
anticipated in the Pre-Feasibility
or Feasibility study.
Highlight and discuss
the materiality of any
unresolved matter that
is dependent on a third
party on which extraction
of the reserve is contingent.
==================================== ============================================================
Classification The basis for the classification Measured mineral resources
of the Ore Reserves have been classified as
into varying confidence Proven ore reserves while
categories. Indicated mineral resources
have been classified as
Probable ore reserves.
==================================== ============================================================
Whether the result appropriately It is the view of the Competent
reflects the Competent Person that the outcomes
Person's view of the of the feasibility study
deposit. undertaken appropriately
reflect the nature and potential
of the deposit to be developed,
viable exploitation is considered
feasible.
==================================== ============================================================
The proportion of Probable All Measured mineral resources
Ore Reserves that have have been converted to Proven
been derived from Measured ore reserves.
Mineral Resources (if
any).
==================================== ============================================================
Audits The results of any audits Cameron Mining has done
or reviews or reviews of Ore Reserve a review of the mining aspects
estimates. of the project, focusing
on scheduling and pit shell
selection. For processing
purposes Randall Schiefeld
and Russell Bradford have
provided a general review,
focusing first of them on
heap leaching and second
on general structure of
the project.
================== ==================================== ============================================================
Discussion Where appropriate a The confidence level is
of relative statement of the relative reflected in the resource
accuracy/ accuracy and confidence classification category
confidence level in the Ore Reserve chosen for the reported
estimate using an approach OR. The definition of current
or procedure deemed Ore Reserves is appropriate
appropriate by the Competent for the level of study and
Person. For example, the geological confidence
the application of statistical imparted by the drilling
or geostatistical procedures grid.
to quantify the relative The reported OR is considered
accuracy of the reserve appropriate and representative
within stated confidence of the grade and tonnage
limits, or, if such at the selected U(3) O(8)
an approach is not deemed cut-off grades.
appropriate, a qualitative
discussion of the factors
which could affect the
relative accuracy and
confidence of the estimate.
==================================== ============================================================
The statement should Minor amounts of inferred
specify whether it relates resources have been unavoidably
to global or local estimates, included into the mine plan.
and, if local, state These resources are mined
the relevant tonnages, late in the mine life, an
which should be relevant evaluation of the effect
to technical and economic of these resources on the
evaluation. Documentation economic outcome of the
should include assumptions project has demonstrated
made and the procedures that the effect is minor
used. and does not affect the
project outcome. The inferred
resources have NOT been
converted to ore reserves.
==================================== ============================================================
Accuracy and confidence It is considered that all
discussions should extend modifying factors applied
to specific discussions to generate the ore reserve
of any applied Modifying estimates have been developed
Factors that may have to a level of accuracy required
a material impact on to support a feasibility
Ore Reserve viability, study.
or for which there are
remaining areas of uncertainty
at the current study
stage.
==================================== ============================================================
It is recognised that No production has been carried
this may not be possible out at Retortillo.
or appropriate in all
circumstances. These
statements of relative
accuracy and confidence
of the estimate should
be compared with production
data, where available.
================== ==================================== ============================================================
JORC Code, 2012 Edition - Table 1 Report (Alameda)
Section 1 Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
Criteria JORC Code explanation Commentary
================== ========================================= ======================================
Sampling Nature and quality of The Alameda deposit was
techniques sampling (eg cut channels, sampled using Diamond Drill
random chips, or specific (DD) and Reverse Circulation
specialised industry (RC) holes on a spacing
standard measurement varying between 50m x 50m
tools appropriate to and 35m x 35m. A total of
the minerals under investigation, 438 DD holes for 43,305m
such as down hole gamma and 87 RC holes for 6,534m
sondes, or handheld XRF were drilled. Most holes
instruments, etc). These were vertical.
examples should not be Berkeley drilled 47 of the
taken as limiting the DD holes for 4,327m. The
broad meaning of sampling. DD core was sampled using
1m intervals in the mineralised
zones, allowing for 2m of
internal low grade or waste.
In addition, the sampling
was extended 3-5m up and
down hole from the interpreted
mineralised zone. Whole
core was used for sampling.
Berkeley drilled all of
the RC holes. The RC drill
samples are collected over
1m intervals and split on
site to provide an approximately
3-5kg sample using a riffle
splitter or cone and quarter
method. Field tests show
that these methods produce
representative samples.
Junta de Energía Nuclear
(JEN) and Empresa Nacional
de Uranio (ENUSA) drilled
391 of the DD holes for
38,978m. The DD core was
sampled using 0.2m to 2m
intervals in the mineralised
zones, with 0.2m and 0.25m
intervals being the most
frequent sample length.
An unknown number of Roto
Percussion open holes (RP)
were also drilled by JEN
and ENUSA. These RP holes
were not used in the resource
estimation process and accordingly,
are not discussed further
in this Table 1 Report.
========================================= ======================================
Include reference to Berkeley sampling protocols
measures taken to ensure include the insertion of
sample representivity standards and blanks into
and the appropriate calibration the sample stream to assess
of any measurement tools the accuracy, precision
or systems used. and methodology of the external
laboratories used. In addition,
field duplicate samples
are inserted to assess the
variability of the uranium
mineralisation. 15-20% of
samples were for quality
control purposes. The laboratories
undertake duplicate sampling
as part of their internal
Quality Assurance/Quality
Control (QA/QC) processes.
Analysis of the QA/QC sample
data indicates satisfactory
performance of both the
field sampling protocols
and assay laboratories procedures,
indicating acceptable levels
of precision and accuracy.
Berkeley drill hole collar
locations were surveyed
by qualified surveyors (Cubica
Ingeniería Metrica,
S.L.) using differential
global positioning system
(DGPS) equipment achieving
sub decimetre accuracy in
horizontal and vertical
position. Down-hole surveys
were undertaken using a
Geovista down-hole deviation
probe. Measurements are
taken every 1cm down hole
and averaged every 10m.
No strongly magnetic rocks
are present within the deposit
which may affect magnetic
based readings. JEN and
ENUSA maps used local grid
coordinates which required
transformation and georeferencing.
Historic collar coordinates
were extracted from the
referenced maps and transformed
to UTM coordinates. Berkeley
re-assigned the elevation
to each collar.
All of the Berkeley drill
holes were logged with a
down-hole GeoVista total
count gamma tool. The probe
was sent to Borehole Wireline
Pty. Ltd. in South Australia
for annual recalibration
in the Adelaide-model test
pits. Calibration includes
the determination of k-factor,
deadtime, bore hole diameter
and fluid corrections, which
are reported in the "Primary
Probe Calibration" document.
All parameters are then
applied during the in-house
equivalent grade (eU(3)
O(8) ) calculation process.
JEN and ENUSA QA/QC protocols
are unknown.
========================================= ======================================
Aspects of the determination Berkeley RC drill samples
of mineralisation that are collected over 1m intervals
are Material to the Public and split on site using
Report. In cases where cone and quarter method
'industry standard' work to provide an approximate
has been done this would 3-5kg field sample.
be relatively simple Scintillometer measurements
(eg 'reverse circulation were taken on all Berkeley
drilling was used to RC samples and this data
obtain 1 m samples from was then used to select
which 3 kg was pulverised the samples to be sent to
to produce a 30 g charge external laboratories for
for fire assay'). In sample preparation and analysis.
other cases more explanation Mineralised intervals determined
may be required, such from scintillometer values
as where there is coarse greater than 150cps were
gold that has inherent extended up and down hole
sampling problems. Unusual by at least 2-5m to ensure
commodities or mineralisation adequate definition of waste
types (eg submarine nodules) boundaries.
may warrant disclosure Field samples were split
of detailed information. in the core shed using a
riffle splitter to 0.7-1kg
and sent to ALS laboratories
for preparation (Seville,
Spain) and analysis (Vancouver,
Canada). Samples were dried,
crushed down to 70% below
2mm and pulverised with
at least 85% of the sample
passing 75um. 10g of sample
was used for uranium analysis
by pressed powder X-ray
fluorescence (XRF) method.
JEN and ENUSA core samples
were prepared in internal
company laboratories and
assayed for uranium using
XRF, Atomic absorption spectroscopy
(AAS) or fluorometric methods.
The JEN and ENUSA assay
data represents 31% of the
total assay database.
================== ========================================= ======================================
Drilling Drill type (eg core, Berkeley drilling comprised
techniques reverse circulation, both DD (HQ and PQ) and
open-hole hammer, rotary RC drilling using a 140mm
air blast, auger, Bangka, diameter face sampling hammer.
sonic, etc) and details For angled DD, oriented
(eg core diameter, triple core was achieved using
or standard tube, depth a plasticine method.
of diamond tails, face-sampling The historical JEN and ENUSA
bit or other type, whether drilling comprised NQ and
core is oriented and HQ sized DD holes. Historical
if so, by what method, drilling accounts for approximately
etc). 78% of the total drill metres.
================== ========================================= ======================================
Drill Method of recording and Berkeley, JEN and ENUSA
sample assessing core and chip DD typically recorded overall
recovery sample recoveries and core recoveries in excess
results assessed. of 90%, which is considered
acceptable.
Berkeley RC drill samples
are collected over 1m intervals
through a cyclone. Plastic
sample bags are strapped
to the cyclone to maximise
sample recovery. Individual
sample bags were not weighed
to assess sample recovery
but a visual inspection
was made by the Company
geologist to ensure all
samples are of approximately
equivalent volume.
========================================= ======================================
Measures taken to maximise The DD drilling rigs used
sample recovery and ensure face discharge bits to ensure
representative nature a low contact between the
of the samples. rock and drilling fluids,
minimising ore washing.
Whole core was sent for
analysis.
The RC drilling rigs utilised
suitably sized compressors
to ensure dry samples where
possible. Plastic sample
bags were strapped to the
cyclone to maximise sample
recovery. Sample logs record
whether the sample was dry,
moist or wet.
Wet samples account for
approximately 10-15% and
typically correspond to
the last 5-10m of the affected
holes.
========================================= ======================================
Whether a relationship Due to potential solubility
exists between sample and mobility of the uranium
recovery and grade and minerals, the use of water
whether sample bias may in core recovery in DD is
have occurred due to controlled.
preferential loss/gain The core and RC sample recoveries
of fine/coarse material. are of an acceptable level
and no bias is expected
from any sample losses.
================== ========================================= ======================================
Logging Whether core and chip Berkeley geological logging
samples have been geologically of DD core included recording
and geotechnically logged descriptions of lithology,
to a level of detail geological period, colour,
to support appropriate oxidation, mineralisation
Mineral Resource estimation, style, alteration, weathering,
mining studies and metallurgical structure, texture, grain
studies. size and mineralogy.
Berkeley geotechnical logging
of DD core included recording
descriptions of integrity
(recovery and RQD), materials
(lithology, rock strength
and depth oxide staining),
structures (type, angle,
contact type, infill, weathering)
Berkeley structural logging
of DD core included recording
descriptions of structure
type, structural angles,
contact type, infill, line
type and slip direction.
Berkeley alteration logging
of DD core included recording
descriptions of metamorphic
textures, alteration mineralogy
and mineralisation style.
Berkeley geological logging
of RC chip samples included
recording descriptions of
lithology, weathering, alteration
and mineralisation. A scintillometer
reading of counts per second
(cps) was recorded for each
1m sample (quantitative).
JEN geological logging includes
recording descriptions of
lithology, iron oxides,
sulphides, uranium mineralogy
fracturing and no recovering
zones.
ENUSA geological logging
includes recording descriptions
of lithology, colour, fracturing
level, recovery, mineralogy,
radiometry and water table.
========================================= ======================================
Whether logging is qualitative Geological logging is qualitative
or quantitative in nature. in nature.
Core (or costean, channel, Berkeley DD core boxes and
etc) photography. samples and RC samples and
chip trays were photographed.
JEN and ENUSA did not take
photographs of drill core
or chip trays.
========================================= ======================================
The total length and All DD and RC drill holes
percentage of the relevant were logged in full by geologists
intersections logged. employed by the relevant
companies.
================== ========================================= ======================================
Sub-sampling If core, whether cut Berkeley DD core was sampled
techniques or sawn and whether quarter, using 0.5m intervals in
and sample half or all core taken. the mineralised zones, including
preparation areas of internal low grade
or waste. In addition, the
sampling was extended 3-5m
up and down hole from the
interpreted mineralised
zone. Whole core was used
for sampling.
JEN and ENUSA DD core was
sampled using 0.1m to 0.4m
intervals in the mineralised
zones, with 0.2m and 0.25m
intervals being the most
frequent sample length.
Whole core was used for
sampling.
========================================= ======================================
If non-core, whether Berkeley RC drill samples
riffled, tube sampled, were collected at 1m intervals.
rotary split, etc. and RC intervals were sampled
whether sampled wet or by splitting dry samples
dry. in the field to 3-5kg using
either a riffle splitter
or cone and quarter method
and further split in the
core shed to 0.7-1kg using
a riffle splitter.
Where samples were wet they
were dried prior to splitting.
In rare cases, wet samples
were split using a cone
and quarter method.
========================================= ======================================
For all sample types, Berkeley samples were sent
the nature, quality and to ALS laboratories for
appropriateness of the preparation and analysis.
sample preparation technique. Samples were dried, fine
crushed down to 70% below
2mm, split to obtain 250g
and pulverised with at least
85% of the sample passing
75um. 10g of sample was
used for uranium analysis
by pressed powder XRF method.
JEN and ENUSA core samples
were prepared and assayed
for uranium at internal
company laboratories using
XRF, AAS or fluorometric
methods.
========================================= ======================================
Quality control procedures Berkeley field tests determined
adopted for all sub-sampling that the sample size and
stages to maximise representivity method of sampling produce
of samples. representative RC samples.
QA/QC procedures involved
the use of standards and
blanks which were inserted
into sample batches at a
frequency of approximately
15-20%.
Quality control procedures
used by JEN and ENUSA are
unknown.
========================================= ======================================
Measures taken to ensure Duplicate splits of RC samples
that the sampling is were taken every 10m down
representative of the hole within the sampled
in situ material collected, intervals by Berkeley. The
including for instance results from these duplicates
results for field duplicate/second-half show optimal repeatability.
sampling.
========================================= ======================================
Whether sample sizes The uranium is typically
are appropriate to the very fine grained. Previous
grain size of the material test work carried out by
being sampled. Berkeley using different
sample sizes demonstrated
that the selected sample
size is appropriate.
================== ========================================= ======================================
Quality The nature, quality and Berkeley assayed samples
of assay appropriateness of the for uranium using the pressed
data assaying and laboratory powder XRF method. This
and laboratory procedures used and whether analytical method reports
tests the technique is considered total uranium content.
partial or total. JEN and ENUSA assayed samples
for uranium were completed
at internal company laboratories
using XRF, AAS or fluorometric
methods.
The sampling and analytical
methods used by Berkeley,
JEN and ENUSA are considered
appropriate for this style
of uranium mineralisation.
========================================= ======================================
For geophysical tools, Down-hole gamma logging
spectrometers, handheld was undertaken for all probe
XRF instruments, etc, accessible holes drilled
the parameters used in by Berkeley to provide eU(3)
determining the analysis O(8) ("equivalent" U(3)
including instrument O(8) grade) data. The down-hole
make and model, reading gamma response was converted
times, calibrations factors to eU(3) O(8) by correcting
applied and their derivation, for radon, hole diameter,
etc. air/water and a deconvolution
filter was also applied.
eU(3) O(8) data was used
in the mineral resource
grade estimation process
when chemical assay data
was not available. eU(3)
O(8) data was also used
to verify mineralisation
intersections based on assay
results.
========================================= ======================================
Nature of quality control Standards, blanks and duplicates
procedures adopted (eg were regularly inserted
standards, blanks, duplicates, into the sample stream by
external laboratory checks) Berkeley, with approximately
and whether acceptable 15-20% of all samples used
levels of accuracy (ie for quality control. The
lack of bias) and precision external laboratories maintain
have been established. their own process of QA/QC
utilising internal standards,
repeats and duplicates.
Review of the Berkeley quality
control samples, as well
as the external laboratory
quality QA/QC reports, has
shown no sample preparation
issues, acceptable levels
of accuracy and precision
and no bias in the analytical
datasets.
JEN and ENUSA used internal
company laboratories. No
QA/QC data is available
for this historic data.
Berkeley drilling has confirmed
the historical JEN and ENUSA
drilling and shown the grade
continuity to be reasonable.
================== ========================================= ======================================
Verification The verification of significant Reported significant intersections
of sampling intersections by either were checked and verified
and assaying independent or alternative by Senior Geological management.
company personnel.
========================================= ======================================
The use of twinned holes. No twinned holes were drilled.
========================================= ======================================
Documentation of primary All primary data was recorded
data, data entry procedures, in templates designed by
data verification, data Berkeley. Assay data from
storage (physical and the external laboratory
electronic) protocols. is received in spreadsheets
and downloaded directly
into an Access Database
managed by the Company.
Data is entered into controlled
excel templates for validation.
The validated data is then
loaded into a password secured
relational database by a
designated Company geologist.
Daily backups of all digital
data are undertaken. These
procedures are documented
in the Berkeley Technical
Procedures and Protocols
manual.
JEN and ENUSA primary paper
data was digitalized and
recoded following the Berkeley
protocols. The validated
data was then loaded into
the password secured relational
database by a designated
Company geologist.
========================================= ======================================
Discuss any adjustment Uranium (ppm) assays received
to assay data. from the external laboratory
were converted to U(3) O(8)
(ppm) using the stoichiometric
factor of 1.179. ENUSA data
was received as ppt (parts
per thousand) and converted
to ppm (parts per million)
================== ========================================= ======================================
Location Accuracy and quality Berkeley drill hole collar
of data of surveys used to locate locations were surveyed
points drill holes (collar and by qualified surveyors (Cubica
down-hole surveys), trenches, Ingeniería Metrica
mine workings and other S.L) using standard DGPS
locations used in Mineral equipment achieving sub
Resource estimation. decimetre accuracy in horizontal
and vertical position.
Berkeley down-hole surveys
were undertaken using a
Geovista down-hole deviation
probe. Measurements were
taken every 1cm down hole
and averaged every 10m.
No strongly magnetic rocks
are present within the deposit
which may affect magnetic
based readings.
JEN and ENUSA holes were
drilled on grid coordinates
and were not surveyed after
drilling.
========================================= ======================================
Specification of the The grid system is UTM ED1950
grid system used. Zone 29N.
========================================= ======================================
Quality and adequacy Topographic control was
of topographic control. based on a digital terrain
model with sub metric accuracy
sourced from the Spanish
Geographical Institute (Instituto
Geográfico Nacional)
and was verified by comparison
with drill hole collar surveys
completed by the surveyor
using DGPS.
================== ========================================= ======================================
Data Data spacing for reporting The majority of the Berkeley
spacing of Exploration Results. drilling was undertaken
and distribution on a nominal 50m by 50m
grid, with some closer spaced
drilling on 35m by 35m.
Section lines are orientated
approximately perpendicular
to the interpreted strike
of the mineralisation.
The historical JEN and ENUSA
drilling was completed on
spaced 50m by 50m grid with
some infill areas spaced
35m by 35m.
========================================= ======================================
Whether the data spacing The data spacing (notionally
and distribution is sufficient 50m by 50m) is considered
to establish the degree sufficient to verify geological
of geological and grade and grade continuity, and
continuity appropriate allow the estimation of
for the Mineral Resource Indicated Mineral Resources.
and Ore Reserve estimation
procedure(s) and classifications
applied.
========================================= ======================================
Whether sample compositing No compositing of RC samples
has been applied. in the field has been undertaken.
================== ========================================= ======================================
Orientation Whether the orientation The mineralisation at Alameda
of data of sampling achieves has two strong orientations.
in relation unbiased sampling of The main body of the mineralisation
to geological possible structures and trends in a NE-SW direction
structure the extent to which this over a strike length of
is known, considering approximately 800m. To the
the deposit type. north, the mineralisation
trends in a NNW-SSE direction,
sub parallel to lithology,
over a strike length of
approximately 1,500m. Despite
the general dip of the host
geological units and structures
ranging from 50-70deg, the
mineralised zone is interpreted
to be sub-horizontal (due
to post mineralisation supergene
processes) to shallowly
dipping to the SE.
========================================= ======================================
If the relationship between The majority of DD and RC
the drilling orientation drill holes are vertical.
and the orientation of Due to the interpreted flat
key mineralised structures lying nature of the mineralisation,
is considered to have no sampling bias is considered
introduced a sampling to have been introduced
bias, this should be by the orientation of the
assessed and reported drilling. This has been
if material. validated by the drilling
of 31 inclined DD holes
and 30 inclined RC holes.
================== ========================================= ======================================
Sample The measures taken to Chain of custody is managed
security ensure sample security. by Berkeley. Samples were
transported from the drill
site by Company vehicle
to a sample preparation
shed where samples were
prepared for dispatch. Samples
were sent directly from
the sample preparation shed
to the laboratory using
a certified courier or a
Berkeley owned vehicle authorised
for radioactive materials
transport. No other freight
was transported with the
samples which were taken
directly from the Berkeley
facility to the external
laboratory. Sample submission
forms were sent in paper
form with the samples as
well as electronically to
the laboratory. Reconciliation
of samples occurred prior
to commencement of sample
preparation for assaying.
The historical drilling
samples were prepared and
analysis using internal
company laboratories. The
chain of custody is unknown.
================== ========================================= ======================================
Audits The results of any audits Sampling techniques and
or reviews or reviews of sampling procedures, as well as QA/QC
techniques and data. data, are reviewed internally
an ongoing basis. Chris
Arnold (Principal Geologist,
AMC Consultants (UK)) independently
reviewed the sampling techniques,
procedures and data. He
undertook a number of site
visits to review and inspect
the application of procedures.
These reviews concluded
that the sampling and analytical
results have resulted in
data suitable for incorporation
into Mineral 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 Type, reference name/number, The Alameda deposit lies
tenement location and ownership on the Salamanca XXVIII
and land including agreements Definitive State Reserve
tenure or material issues with 6362 which is 100% owned
status third parties such as by Berkeley Minera España
joint ventures, partnerships, S.L., a wholly owned subsidiary
overriding royalties, of Berkeley Energia Limited.
native title interests, The Definitive State Reserve
historical sites, wilderness is currently in the 12(th)
or national park and year of its 2(nd) 30-year
environmental settings. term (valid until 13 August
2033) and may be extended
for an additional period
of 30 years. It covers an
area of 16.5km(2) and includes
the entire area containing
the Alameda mineralisation.
No historical sites or national
parks are located within
the Concession.
=============================== ======================================
The security of the Tenure in the form of a
tenure held at the time Definitive State Reserve
of reporting along with has been granted and is
any known impediments considered secure. There
to obtaining a licence are no known impediments
to operate in the area. to obtaining a licence to
operate in this area.
================ =============================== ======================================
Exploration Acknowledgment and appraisal Previous exploration at
done of exploration by other Alameda was completed initially
by other parties. by JEN and ENUSA, both Spanish
parties state run companies, from
the late 1950's through
to the mid 1980's. Work
completed by JEN and ENUSA
included mapping, radiometric
surveys, trenching, RP,
RC and DD drilling.
A detailed data assessment
and verification of the
historical data supplied
by JEN and ENUSA has been
undertaken by Berkeley.
No significant issues with
the data were detected.
================ =============================== ======================================
Geology Deposit type, geological The uranium mineralisation
setting and style of is hosted within Cambrian
mineralisation. metasediments adjacent to
granite. The mineralisation
typically occurs as a sub-horizontal
to shallowly dipping layer
occurring between surface
and 180m depth with strong
structural control on either
side of a central breccia
zone. The style of the uranium
mineralisation includes
veins, stockwork and disseminated
mineralisation in joint/fracture
filling associated with
brittle deformation. Uraninite
and coffinite are the primary
uranium minerals. Secondary
uranium mineralisation is
developed in "supergene-like"
tabular zones corresponding
to the depth of weathering.
Most of the mineralisation
is hosted within partially
weathered (51%) and unweathered
(46%) metasediment. This
deposit falls into the category
defined by the International
Atomic Energy Association
(IAEA) as Vein Type, Sub
Type Iberian Type.
================ =============================== ======================================
Drill A summary of all information No new exploration results
hole material to the understanding are included in this release.
Information of the exploration results
including a 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 All Berkeley drill holes
this information is within the resource area
justified on the basis have previously been reported
that the information in releases to the ASX providing
is not Material and collar easting, northing,
this exclusion does elevation, dip, azimuth
not detract from the and length of hole and mineralised
understanding of the intercepts as encountered.
report, the Competent
Person should clearly
explain why this is
the case.
================ =============================== ======================================
Data In reporting Exploration No new exploration results
aggregation Results, weighting averaging are included in this release.
methods techniques, maximum All Berkeley drill holes
and/or minimum grade within the resource area
truncations (eg cutting have previously been reported.
of high grades) and
cut-off grades are usually
Material and should
be stated.
=============================== ======================================
Where aggregate intercepts No new exploration results
incorporate short lengths are included in this release.
of high grade results All Berkeley drill holes
and longer lengths of within the resource area
low grade results, the have previously been reported.
procedure used for such
aggregation should be
stated and some typical
examples of such aggregations
should be shown in detail.
=============================== ======================================
The assumptions used No metal equivalent values
for any reporting of were used.
metal equivalent values
should be clearly stated.
================ =============================== ======================================
Relationship These relationships All drilling was planned
between are particularly important in such a way as to intersect
mineralisation in the reporting of expected mineralisation
widths Exploration Results. in a perpendicular manner.
and intercept If the geometry of the The uranium mineralisation
lengths mineralisation with is interpreted to be flat
respect to the drill lying to shallowly dipping
hole angle is known, so the majority of the RC
its nature should be holes were drilled vertically.
reported. The interpreted geometry
of the mineralisation has
been validated by the drilling
of 33 inclined DD holes
and 32 inclined RC holes.
=============================== ======================================
If it is not known and The previously reported
only the down hole lengths (no new exploration results
are reported, there are included in this release)
should be a clear statement down-hole intervals are
to this effect (eg 'down interpreted to approximate
hole length, true width true widths.
not known').
================ =============================== ======================================
Diagrams Appropriate maps and Appropriate diagrams, including
sections (with scales) drill plans and cross sections
and tabulations of intercepts have been included in previously
should be included for reported ASX releases.
any 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 Where comprehensive No new exploration results
reporting reporting of all Exploration are included in this release.
Results is not practicable, All Berkeley drill holes
representative reporting within the resource area
of both low and high have previously been reported.
grades and/or widths
should be practiced
to avoid misleading
reporting of Exploration
Results.
================ =============================== ======================================
Other Other exploration data, Down-hole gamma logging
substantive if meaningful and material, of all Berkeley holes was
exploration should be reported including undertaken to provide eU(3)
data (but not limited to): O(8) data. Comparison of
geological observations; eU(3) O(8) data with chemical
geophysical survey results; assay data have shown that
geochemical survey results; on average eU(3) O(8) tends
bulk samples - size to underestimate at higher
and method of treatment; grades (>500ppm) and overestimate
metallurgical test results; at lower grades (<200ppm).
bulk density, groundwater, The Mineral Resource Estimate
geotechnical and rock (MRE) reported in this release
characteristics; potential was estimated using chemical
deleterious or contaminating assay data as the primary
substances. method for grade estimation
in the modelling process.
eU(3) O(8) data was used
for grade estimation process
when chemical assay data
was not available.
The Company has reported
the results of a PFS for
the Salamanca Project which
includes the Alameda deposit
(refer ASX Announcement
dated 26 September 2013).
The PFS included hydrogeological,
geotechnical, mining, metallurgical
and process engineering
studies, as well as environmental
impact assessments.
================ =============================== ======================================
Further The nature and scale Further work planned for
work of planned further work the Alameda deposit includes
(eg tests for lateral additional infill drilling
extensions or depth focused on improving geological
extensions or large-scale confidence and resource
step-out drilling). classification.
Geological studies will
include detailed interpretation
of lithology, structure
and weathering and an assessment
of potential relationships
between these factors and
uranium grade distribution.
Further work is also planned
on a number of other exploration
targets within the Alameda
Region.
=============================== ======================================
Diagrams clearly highlighting These have been included
the areas of possible in previously reported ASX
extensions, including releases.
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 the preceding section also apply to this
section.)
Criteria JORC Code explanation Commentary
================ ================================= =================================================================
Database Measures taken to ensure Drill hole data is stored
integrity that data has not been in a password protected
corrupted by, for example, relational database (Access).
transcription or keying Drill data recorded in digital
errors, between its Excel templates is transferred
initial collection and to the database by the project
its use for Mineral geologist who is responsible
Resource estimation for reviewing and validating
purposes. the data. Assay data is
received from the external
laboratories in digital
format and is loaded directly
into the database after
QA/QC has been checked and
validates the rest of assays.
Geological logging is restricted
to appropriate codes relevant
to the local geology, mineralisation,
weathering and alteration
setting. A copy of the master
database is linked to Surpac
mining software for Mineral
Resource Estimation.
================================= =================================================================
Data validation procedures Database validation checks
used. including collar survey
position, down hole survey
control, assay limits, eU(3)
O(8) profiles, sample intervals
and logging codes are completed
prior to the data being
transferred to the master
database.
================ ================================= =================================================================
Site visits Comment on any site Sampling techniques and
visits undertaken by procedures, as well as QA/QC
the Competent Person data, are reviewed internally
and the outcome of those an ongoing basis. Chris
visits. Arnold (Principal Geologist,
AMC Consultants (UK)) reviewed
the sampling techniques,
procedures, data and resource
estimation methodology.
He undertook a number of
site visits to review and
inspect the application
of these procedures. He
concluded that the sampling
and analytical results available
were appropriate for estimation
of the Mineral Resource.
================================= =================================================================
If no site visits have Site visits have been undertaken.
been undertaken indicate
why this is the case.
================ ================================= =================================================================
Geological Confidence in (or conversely, The confidence of the geological
interpretation the uncertainty of) interpretation is appropriate
the geological interpretation for the current level of
of the mineral deposit. resource estimation. The
resource is defined within
mineralised envelopes which
encompass all zones of significant
mineralisation.
================================= =================================================================
Nature of the data used Geology and mineralisation
and of any assumptions interpretation is based
made. on geological logging and
sample assays derived from
RC and DD drilling, along
with cross sectional interpretations
which include surface mapping
information and geophysical
studies.
================================= =================================================================
The effect, if any, Structural studies show
of alternative interpretations dips of structures vary
on Mineral Resource between 30deg and vertical
estimation. however; the uranium mineralisation
has undergone supergene
remobilisation and is interpreted
to be flat lying to shallowly
dipping and generally within
180m from surface.
================================= =================================================================
The use of geology in On the deposit scale the
guiding and controlling uranium grade is controlled
Mineral Resource estimation. by both lithology and structure,
while on a local scale the
grade is interpreted to
be influenced by supergene
processes.
================================= =================================================================
The factors affecting Geological logging and uranium
continuity both of grade assay of samples from drill
and geology. holes has demonstrated the
continuity of the grade
and lithology between mineralised
sections. Breaks in continuity
are likely due to structural
offsets, some of which have
been observed or interpreted
from surface mapping.
================ ================================= =================================================================
Dimensions The extent and variability The Alameda uranium mineralisation
of the Mineral Resource covers an area of approximately
expressed as length 2km by 1.2km and generally
(along strike or otherwise), occurs within 180m of surface.
plan width, and depth
below surface to the
upper and lower limits
of the Mineral Resource.
================================= =================================================================
Estimation The nature and appropriateness A mineralised envelope is
and modelling of the estimation technique(s) created encompassing all
techniques applied and key assumptions, zones of significant mineralisation.
including treatment A number of different domains
of extreme grade values, have been interpreted.
domaining, interpolation Geostatistical variogram
parameters and maximum modelling was used to determine
distance of extrapolation appropriate parameters for
from data points. If estimation of uranium. Primary
a computer assisted estimation is a pass with
estimation method was Ordinary Kriging (OK) method
chosen include a description for domains Z11 and Z13
of computer software and Inverse Distance Squared
and parameters used. Weighting (ID(2) ) for the
remaining domains.
Datamine software was used
for mineralisation volume
interpretation and uranium
grade estimation by AMC.
Four sources of drillhole
uranium grade data was used:
* Berkeley Chemical U(3) O(8) (ppm): 13%
* Berkeley Radiometric Equivalent eU(3) O(8) (ppm): 23%
* Berkeley Portable XRF U(3) O(8) (ppm): 1%
* ENUSA Chemical U(3) O(8) (ppm): 63%
The drill hole spacing is
nominally 50m by 50m, with
some closer spacing at 35m
by 35m.
Five mineralisation domains
were identified at Alameda
(Z9, Z11, Z12, Z13 and Z14).
2m samples composites were
used to estimate grade into
10m by 10m by 6m parent
blocks, allowing sub-blocking
of 5m by 5m by 3m
In order to reduce local
bias due to extreme high
grades, top cuts were applied:
* Z9: 2,000ppm U(3) O(8)
* Z11: 8,000ppm U(3) O(8)
* Z12: 4,000ppm U(3) O(8)
* Z13: 5,000ppm U(3) O(8)
* Z14: 4,000ppm U(3) O(8)
Search ellipse radii variable
for all domains in metres,
along-strike /across-strike/down-dip
(1(st) and 2(nd) pass):
* Z9: 75/75/6 to 150/150/6
* Z11-13: 40/40/6 to 80/80/6
Search orientation variable
per domain (dip, plunge,
dip dir.):
* Z9: 0/0/347
* Z11: 0/0/347
* Z12: 15/0/262
* Z13: 30/0/267
* Z14: 30/0/262
Search radii used for OK
was mostly 40/40/5 (major/semi-major/minor)
to estimate a grade for
blocks not estimated in
the 1(st) pass, the radii
were doubled on the 2(nd)
pass.
In-situ dry bulk densities
were assigned based on zones
of weathering intensity
and used to estimate tonnage.
Densities are from diamond
core measurements using
the Archimedes principle.
================================= =================================================================
The availability of The reported resource estimate
check estimates, previous was compared with the previous
estimates and/or mine resource estimate (September
production records and 2010) which was based on
whether the Mineral earlier drill campaigns
Resource estimate takes and historical ENUSA resource
appropriate account estimates. Both of which
of such data. support the reported MRE.
No mining production has
taken place at Alameda.
================================= =================================================================
The assumptions made The resource model only
regarding recovery of estimates uranium.
by-products.
================================= =================================================================
Estimation of deleterious At this stage, there are
elements or other non-grade no deleterious elements
variables of economic or other non-grade variables
significance (eg sulphur identified as being of economic
for acid mine drainage significance at Alameda.
characterisation).
================================= =================================================================
In the case of block The uranium grade is estimated
model interpolation, into the 10m (X) by 10m
the block size in relation (Y) by 6m (Z) blocks. This
to the average sample compares to the average
spacing and the search drill spacing of 35m by
employed. 35m in X and Y and an assumed
mining bench height of 6m.
This block size was chosen
to match the potential open
cut mining methodology.
================================= =================================================================
Any assumptions behind Two selective mining unit
modelling of selective dimensions have been considered
mining units. in the current model:
* North covering an area of 1.5km by 0.5-0.02km within
50m of surface.
* South with an area of 0.8km by 0.2km within 150m of
surface.
Both areas contain mineralised
zones that average between
20m to 50m in thickness.
================================= =================================================================
Any assumptions about Uranium is the only economic
correlation between metals estimated in the
variables. current resource model.
================================= =================================================================
Description of how the Geological interpretation
geological interpretation controlled the volume of
was used to control the resource estimate by
the resource estimates. restricting the interpretation
of the mineralisation volume
and associated samples to
material with continuity
above a 100ppm U(3) O(8)
grade.
The domains are based on
geology, structure and uranium
grade with defined zones
of mineralisation that show
continuity along and across
strike.
A further division of the
model into completely weathered,
partially weathered and
fresh rock is applied by
triangulated surfaces interpreted
from the logging of the
drill samples. This division
is only applied for density
purposes.
================================= =================================================================
Discussion of basis Uranium grade distribution
for using or not using exhibits a strong positive
grade cutting or capping. skewness, so a top cut was
applied to reduce local
bias by extreme grades outliers
- nominally approximating
the 97.5 population percentile.
The domains were assessed
independently and a top
cut grade was determined
for each domain.
================================= =================================================================
The process of validation, Validation of the MRE included
the checking process visual inspection of the
used, the comparison grade distribution compared
of model data to drill to the drill data, comparison
hole data, and use of of block model statistics
reconciliation data to the sample statistics
if available. and generation of swath
plots. These confirmed that
the MRE appropriately represents
the grade and tonnage distribution
of the uranium mineralisation
at the confidence levels
reported.
================================= =================================================================
Moisture Whether the tonnages The resource tonnage is
are estimated on a dry reported on a dry bulk density
basis or with natural basis. In-situ dry bulk
moisture, and the method density measurements were
of determination of completed on dry core (Archimedes
the moisture content. method) and sample grades
are reported using dry weight.
No moisture content of drill
core has been determined.
================================= =================================================================
Cut-off The basis of the adopted The MRE has been reported
parameters cut-off grade(s) or using a 200ppm U(3) O(8)
quality parameters applied. cut-off grade. The Salamanca
Project PFS demonstrated
that a 100ppm U(3) O(8)
cut-off is economic. Based
on the current uranium market,
reporting of the MRE at
a 200ppm cut-off grade is
both justifiable and consistent
with previous published
MRE's for this style of
mineralisation.
================ ================================= =================================================================
Mining Assumptions made regarding The PFS demonstrated that
factors possible mining methods, the Alameda resource can
or assumptions minimum mining dimensions potentially be extracted
and internal (or, if using open pit mining methods,
applicable, external) with the recovery of uranium
mining dilution. It through the application
is always necessary of acid heap leach methods.
as part of the process Indicative parameters used
of determining reasonable for pit optimisation purposes
prospects for eventual were:
economic extraction Uranium selling price: US$65/lb
to consider potential U(3) O(8) ,
mining methods, but Total Mining Cost: US$9.76/lb
the assumptions made U(3) O(8)
regarding mining methods Mining recovery: 97.5%
and parameters when Mining dilution: 5%
estimating Mineral Resources Plant Process Cost: US$10.41/lb
may not always be rigorous. U(3) O(8)
Where this is the case, Recovery U(3) O(8) : 85%
this should be reported Royalties: 3.7%
with an explanation
of the basis of the
mining assumptions made.
================ ================================= =================================================================
Metallurgical The basis for assumptions Berkeley has completed a
factors or predictions regarding number of metallurgical
or assumptions metallurgical amenability. testwork programs for Alameda
It is always necessary as part of the scoping,
as part of the process PFS and definitive feasibility
of determining reasonable studies, including column
prospects for eventual leach tests at commercial
economic extraction height (6m). These tests
to consider potential have shown that heap leaching
metallurgical methods, can achieve uranium recoveries
but the assumptions of at least 85%.
regarding metallurgical
treatment processes
and parameters made
when reporting Mineral
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.
================ ================================= =================================================================
Environmen-tal Assumptions made regarding Spent ore from the on-off
factors possible waste and process heap leach pads ('ripios')
or assumptions residue disposal options. will initially be stored
It is always necessary on the heap leach pads and
as part of the process subsequently backfilled
of determining reasonable into isolated and lined
prospects for eventual (clay layer and HDPE liner)
economic extraction areas within the mined pits
to consider the potential on a continuous basis once
environmental impacts sufficient space is available.
of the mining and processing Acid Rock Drainage (ARD)
operation. While at and Natural Occurring Radioactive
this stage the determination Materials (NORM) waste will
of potential environmental be placed onto temporary
impacts, particularly dumps designed with the
for a greenfields project, required isolation system
may not always be well (clay layer and HDPE liner)
advanced, the status until the waste is backfilled
of early consideration into the mined pits towards
of these potential environmental the end of the mine life.
impacts should be reported. At the end of the mine life,
Where these aspects the entire volume of ripios,
have not been considered ARD and NORM waste will
this should be reported be fully encapsulated within
with an explanation the mined pits, and the
of the environmental surface rehabilitated as
assumptions made. per the existing profile
and vegetation.
================================= =================================================================
Bulk density Whether assumed or determined. Bulk density values were
If assumed, the basis derived from 980 core density
for the assumptions. measurements.
If determined, the method The in-situ dry bulk density
used, whether wet or values are:
dry, the frequency of * Surface cover: 2.40g/cm(3)
the measurements, the
nature, size and
representativeness * Oxidised: 2.52g/cm(3)
of the samples.
* Partially oxidised: 2.70g/cm(3)
* Fresh rock: 2.75g/cm(3)
================================= =================================================================
The bulk density for Fresh and partially oxidised
bulk material must have rock is competent enough
been measured by methods to ensure the method used
that adequately account takes into account any rock
for void spaces (vugs, porosity. A factor derived
porosity, etc), moisture from comparison with DD
and differences between core was used to adjust
rock and alteration the oxidised and surface
zones within the deposit. cover material.
================================= =================================================================
Discuss assumptions The density measurements
for bulk density estimates have been classified by
used in the evaluation weathering intensity, defined
process of the different by the geological logging.
materials. Four dominant zones have
been identified - surface
cover, oxidised, partially
oxidised, and fresh rock.
The average of the density
data from each zone was
applied in the resource
model.
================ ================================= =================================================================
Classification The basis for the classification The reported MRE has been
of the Mineral Resources classified as Indicated
into varying confidence or Inferred after consideration
categories. of the following:
* Adequate geological evidence and drill hole sampling
is available to imply geological and grade
continuity.
* Adequate in-situ dry bulk density data is available
to estimate appropriate tonnage factors.
* Adequate mining, metallurgy and processing knowledge
to imply potential prospect for eventual economic
extraction.
================================= =================================================================
Whether appropriate The reported MRE has been
account has been taken classified with consideration
of all relevant factors of the quality and reliability
(ie relative confidence of the raw data, the confidence
in tonnage/grade estimations, of the geological interpretation,
reliability of input the number and spacing of
data, confidence in intercepts through the mineralised
continuity of geology zones and knowledge of grade
and metal values, quality, continuity gained from observation
quantity and distribution and geostatistical analysis.
of the data).
================================= =================================================================
Whether the result appropriately The reported MRE and its
reflects the Competent classification are consistent
Person's view of the with the CP's view of the
deposit. deposit. The CP was responsible
for determining the resource
classification.
================ ================================= =================================================================
Audits The results of any audits An external review was undertaken
or reviews or reviews of Mineral by AMC Consultants on the
Resource estimates. MRE reported in December
2011. The review concluded
that the estimate was considered
to reflect the understanding
of the geology and grade
continuity.
Craig Gwatkin (CP) also
concluded that the estimates
appropriately represented
the grade and tonnage distribution
of uranium mineralisation
at confidence levels commensurate
with the reported resource
classification.
================================= =================================================================
Discussion Where appropriate a The confidence level is
of relative statement of the relative reflected in the resource
accuracy/ accuracy and confidence classification category
confidence level in the Mineral chosen for the reported
Resource estimate using MRE. The definition of current
an approach or procedure Mineral Resources is appropriate
deemed appropriate by for the level of study and
the Competent Person. the geological confidence
For example, the application imparted by the drilling
of statistical or geostatistical grid.
procedures to quantify The reported MRE is considered
the relative accuracy appropriate and representative
of the resource within of the grade and tonnage
stated confidence limits, at the 200ppm U(3) O(8)
or, if such an approach cut-off grade. The application
is not deemed appropriate, of geostatistical methods
a qualitative discussion has helped to increase the
of the factors that confidence of the model
could affect the relative and quantify the relative
accuracy and confidence accuracy of the resource
of the estimate. on a global scale. It relies
on historical data being
of similar standard as recent
infill drilling. The relevant
tonnages and grade are variable
on a local scale.
The nature of the mineralisation
and the relatively high
nugget effect may result
in local grade estimates
being lower confidence,
with smoothing of the grade
tonnage distribution at
cut-off grades above 200ppm
U(3) O(8) .
The CP considers that the
drilling grid in the area
is sufficient for classification
of an Indicated and Inferred
Mineral Resource.
================================= =================================================================
The statement should The Alameda deposit is likely
specify whether it relates to have local variability.
to global or local estimates, The global assessment is
and, if local, state an indication of the average
the relevant tonnages, tonnages and grade estimate
which should be relevant for each geological domain.
to technical and economic
evaluation. Documentation
should include assumptions
made and the procedures
used.
================================= =================================================================
These statements of No production has been carried
relative accuracy and out at Alameda.
confidence of the estimate
should be compared with
production data, where
available.
================ ================================= =================================================================
Section 4 Estimation and Reporting of Ore Reserves
(Criteria listed in section 1, and where relevant in sections 2
and 3, also apply to this section.)
Criteria JORC Code explanation Commentary
================ ====================================== ============================================================
Mineral Description of the Mineral A mineral resource has been
Resource Resource estimate used estimated using block modelling
estimate as a basis for the conversion techniques as describes
for conversion to an Ore Reserve. in Section 3 of Table 1.
to Ore A block model of 10x10x6
Reserves m has been created and the
resource estimated using
Ordinary Krigging and Uniform
Conditioning.
Alameda Mineral Resource
at 90 ppm mining cut off
==================================== ============================================================
Clear statement as to The mineral resource estimate
whether the Mineral is inclusive of any ore
Resources are reported reserves
additional to, or inclusive
of, the Ore Reserves.
================== ==================================== ============================================================
Site visits Comment on any site Site visits took place from
visits undertaken by 9th to 12th of November
the Competent Person 2015. The following inspections
and the outcome of those were made:
visits. * The site of the pit
* The site of the proposed dump sites
* The site of the proposed plant site including the ore
stockpile
* The core yard where cores were inspected
* The access to the site and existing infrastructure
around the site.
No material issues that
are likely to prevent the
establishment of mining
and processing activities
at the site were identified
during the site visit.
==================================== ============================================================
If no site visits have Site visits have been undertaken.
been undertaken indicate
why this is the case.
================== ==================================== ============================================================
Study The type and level of The level of study is Definitive
Status study undertaken to Feasibility Study. Only
enable Mineral Resources measured and indicated resources
to be converted to Ore have been considered in
Reserves. the declaration of ore reserves
==================================== ============================================================
The Code requires that All factors required to
a study to at least convert Resources to Reserves
Pre-Feasibility Study have been considered including
level has been undertaken capital and operating costs,
to convert Mineral Resources selling prices, geotechnical
to Ore Reserves. Such conditions, metallurgical
studies will have been recoveries and reagent consumptions,
carried out and will environmental and social
have determined a mine constrains, etc. These factors
plan that is technically were used to determine the
achievable and economically optimum economic pit shell
viable, and that material (using Whittle optimization
Modifying Factors have software). The optimal pit
been considered. shell was used as the basis
to design an open pit that
considers slope angles,
ramps and berms in the different
sectors of the pit. The
reserves reported are within
the final pit design. The
use of these factors has
resulted in a technically
and economically viable
plan.
==================================== ============================================================
Cut-off The basis of the cut-off Cut-off grade has been estimated
parameters grade(s) or quality using a combination of factors:
parameters applied * Different selling price: from 45$/lb to 65$/lb
* Mine costs derived from the analysis of 5 different
proposals from mining contractors.
* Recoveries and acid consumption obtained from
metallurgical testwork done at Mintek (South Africa)
for 6 m columns.
* Rehabilitation costs.
The cut-off grade applied
is 90ppm
==================================== ============================================================
Mining The method and assumptions A mine design to definitive
factors used as reported in feasibility study levels
or assumptions the Pre-Feasibility of accuracy has been undertaken
or Feasibility Study as the basis for the estimation
to convert Mineral Resource of Ore Reserves. This study
to an Ore Reserve (i.e. has included:
either by application * Exploration and sampling of the deposit
of appropriate factors
by optimisation or by
preliminary or detailed * Modelling and estimation of mineral resources
design).
* Mine design of an open pit including a pit
optimization study
* Design of all dumps and stockpiles required.
* Metallurgical testwork
* Metallurgical process and plant design
* Determination and design of all infrastructure
requirements
* Costing based on multiple quotes
* Financial evaluation by discounted cashflow analysis
==================================== ============================================================
The choice, nature and The deposit is shallow (between
appropriateness of the 0 to 160m) and massive,
selected mining method(s) the pre-strip is therefore
and other mining parameters low with a stripping ratio
including associated 1.08 (t to t). Due to the
design issues such as depth and geometry of the
pre-strip, access, etc. deposit, the selected mining
method is Open Pit mining
ensuring a good recovery
of the deposit. Some of
the pre-strip material will
be used as construction
material. Access to the
pit will be by conventional
open pit ramps, 25m in width
that enables access for
100 t trucks.
==================================== ============================================================
The assumptions made Geotechnical design parameters
regarding geotechnical have been derived for the
parameters (eg pit slopes, various material types encountered
stope sizes, etc), grade at the site based on core
control and pre-production logging and laboratory test
drilling. work. Open pit slopes have
been divided into different
design sectors and each
of them has specific conditions
applied. Overall slope angles
in the identified design
sectors range from 43 degrees
to 58 degrees.
Grade control will be done
based on two main sources
of data:
* Portable XRF on blast hole collected dust and rock
chips
* Blast hole chemical assay
Routine XRF testing will
provide the basic information
for ore grade control in
the ore. The cost for these
activities has been considered
as part of the labour cost
of the Berkeley technical
services.
The blast hole samples will
be collected as 6 m composites.
Face mapping and geological
logging are used to confirm
the results. It has been
assumed that 30% of the
total ore samples and 10%
of the waste samples will
be sent to the laboratory
for the first year as part
of a QA / QC process for
the gamma probing. After
first year, only 10% of
ore blast holes and 5% of
waste blast holes will be
collected for chemical analysis.
==================================== ============================================================
The major assumptions A Pit optimisation study
made and Mineral Resource was undertaken the techno-economic
model used for pit and data set used in this optimisation
stope optimisation (if process were largely based
appropriate). on the outcomes of the pre-feasibility
study with the exception
of the geotechnical parameters
which were determine to
DFS levels of accuracy.
==================================== ============================================================
The mining dilution Planned dilution of Alameda
factors used. was applied through regularisation
of the block model. The
original resource model
produced by CSA was populated
with minimum block sizes
of 5x5x1.5. The block model
was then regularised to
10x10x6 to account for the
selective mining unit. As
a larger selective mining
unit was applied to the
Alameda model, lower dilution
and mining recovery factors
were applied in comparison
to the other deposits. An
additional dilution of 1%
and mining recovery of 99%
were applied to account
for unplanned dilution due
to blast movement, mixing
of ore and waste and mining
angles.
==================================== ============================================================
The mining recovery Mining recovery factor used
factors used. is 99%
==================================== ============================================================
Any minimum mining widths SMU is 10x10x6m, minimum
used. with for mining is established
in 30m
==================================== ============================================================
The manner in which No Inferred material is
Inferred Mineral Resources used in the study, all reserves
are utilised in mining estimated are based on measured
studies and the sensitivity and indicated resources.
of the outcome to their
inclusion.
==================================== ============================================================
The infrastructure requirements The infrastructure required
of the selected mining is minimum: access by road,
methods. power and water. The mining
infrastructure cluster will
be provided by the selected
mining contractor. A metallurgical
process plant will be constructed.
==================================== ============================================================
Metallurgical The metallurgical process The heap leach process is
factors proposed and the appropriateness proposed followed by ion
or assumptions of that process to the exchange (IX). Loaded resin
style of mineralisation. will be then trucked to
the Retortillo plant where
the resins will be eluted
and the eluated incorporated
into the downstream SX and
ADU precipitation. The ADU
precipitate is calcined
to produce U3O8. The recoveries
obtained from testwork (82%
including a scale-up factor
of 4%) and the low acid
consumption makes heap leaching
the preferred process route.
Ore, when crushed, breaks
along the fractures where
the uranium minerals occur,
hence milling or fine crushing
is not required. The 40mm
liberation size is achieved
with only primary and secondary
crushing. Acid leaching
has been demonstrated to
be the preferred process.
Tank leaching, although
increasing recovery by 2-3%,
has significantly higher
capital and operational
costs, and so is economically
a less attractive process
than heap leaching.
==================================== ============================================================
Whether the metallurgical The process method selected
process is well-tested is the standard method for
technology or novel mineralogically similar
in nature. uranium ores. A number of
mines world-wide operate
utilising heap leaching
with sulphuric acid. The
plant recoveries achieved
are typically similar to
the results predicted by
the testwork.
==================================== ============================================================
The nature, amount and Testwork was carried out
representativeness of using 1-metre high columns.
metallurgical test work Samples used for these column
undertaken, the nature tests were 3 composites
of the metallurgical of drill cores. Overall
domaining applied and uranium recoveries reported
the corresponding metallurgical are averages of the dissolutions
recovery factors applied. achieved in 1m column testwork,
multiplied by a scale-up
factor of 96%. This factor
is lower than the scale-up
factor used for Retortilo
and Zone 7, as the factor
for these deposits was based
on 6m column testwork, whereas
the testwork on Alameda
ore has only been carried
out on 1m columns, and therefore
indicates a lower scale-up
factor. The overall recovery
is predicted to be 82%.
Testwork is planned for
Alameda ore in 6m columns.
==================================== ============================================================
Any assumptions or allowances At this stage, no deleterious
made for deleterious elements have been identified
elements. as being of economic significance.
==================================== ============================================================
The existence of any Samples used for these 1
bulk sample or pilot metre column tests were
scale test work and 3 composites of drill cores.
the degree to which The 1m column tests are
such samples are considered not accepted as being pilot
representative of the scale tests. Tests in 6m
orebody as a whole. columns are planned.
==================================== ============================================================
For minerals that are The product mineralogy does
defined by a specification, not depend on the minerals
has the ore reserve in the ore, due to after
estimation been based the leaching process, all
on the appropriate mineralogy soluble uranium is precipitated
to meet the specifications? as U(3) O(8)
==================================== ============================================================
Environmental The status of studies Environmental Impact Assesment
of potential environmental has been done and is ready
impacts of the mining to be submitted to the authorities.
and processing operation. Impacts identified are compatible
Details of waste rock with environment.
characterisation and Waste rock characterization
the consideration of has been done in base of
potential sites, status the results in the studies
of design options considered developed for Zona 7 and
and, where applicable, Retortillo. Caracterization
the status of approvals studies are based on Spanish
for process residue and European Union legislation,
storage and waste dumps summarized in two main decrees:
should be reported. * Real Decreto 975/2009
* Real Decreto 777/2012
Waste has been divided into:
* Inert: comprising Tertiary cover, and Completely
Weathered lithologies with less than 40ppm of U3O8.
* Non-Inert: all the lithologies with more than 40ppm
U3O8 and the Partially Weathered and Unweathered
materials.
One waste dump has been
considered for each of the
two previous type of wastes.
Non-inert waste will need
a liner as waste dump floor
while Inert waste only need
a conventional preparation
based on topsoil removal
and base compaction.
Waste dumps approved by
the Exploitation Project.
Detailed project for waste
dump will be finalize before
operation starts.
==================================== ============================================================
Infrastructure The existence of appropriate Access infrastructure is
infrastructure: availability minor due to existing roads,
of land for plant development, and the same is applicable
power, water, transportation for power, water, etc.
(particularly for bulk Land acquisition hasn't
commodities), labour, begun but it is not expected
accommodation;or the difficulties to reach amicable
ease with which the agreements with the current
infrastructure can be landowners, and if any,
provided, or accessed. the law allow the company
for the expropriation. Total
land to be acquired is around
487Ha.
The project location is
not remote and accommodation
can be done in all villages
and towns around.
================== ==================================== ============================================================
Costs The derivation of, or Capital costs have been
assumptions made, regarding estimated through the issue
projected capital costs of detailed enquiries to
in the study. multiple contractors and
the receipt of formal proposals
by possible suppliers or
contractors.
==================================== ============================================================
The methodology used Mining operational cost
to estimate operating have been calculated from
costs. formal proposals from 5
possible contractors.
Of the 5 proposals, one
has been discarded because
of elevated rates. The other.
4 of them are in a very
close range and the selected
one is the lowest. The different
between the lowest and the
average of the 4 low range
contractors is less than
10%.
Processing cost have been
estimated based on consumptions
obtained from testwork and
engineering design, and
proposals received from
suppliers of the different
commodities. Man-power was
estimated based on similar
operations and cost based
on a benchmarking of this
cost in other operations
in country.
==================================== ============================================================
Allowances made for Deleterious elements were
the content of deleterious analysed in the ore and
elements. in the PLS, and non-deleterious
elements were found at levels
that could penalize the
product.
==================================== ============================================================
Any assumptions or allowances N/A
made for deleterious
elements.
==================================== ============================================================
The source of exchange Consensus of different analysts
rates used in the study.
==================================== ============================================================
Derivation of transportation Estimated based on proposals
charges. of courier companies
==================================== ============================================================
The basis for forecasting Estimated based on the industry
or source of treatment standards
and refining charges,
penalties for failure
to meet specification,
etc.
==================================== ============================================================
The allowances made 1% Royalty is payable to
for royalties payable, Anglo Pacific Group, Plc
both Government and and 0.375% royalty is payable
private. to Resource Capital Fund,
and 2.5% Royalty payable
to ENUSA
25% on benefits has been
considered as a fix tax
in Spain.
==================================== ============================================================
Revenue The derivation of, or Projected U(3) O(8) concentrate
factors assumptions made regarding quality is consistent with
revenue factors including the results of metallurgical
head grade, metal or test work data completed
commodity price(s) exchange for the project, compared
rates, transportation against standard product
and treatment charges, specifications at converters.
penalties, net smelter Uranium revenues are based
returns, etc. on the latest published
long term contract pricing
forecasts (LT mid-range)
from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030. The
company considers this a
conservative estimate of
long term prices, with analyst
consensus forecasts reaching
US$65 per pound long term.
Commercialisation costs
of 1% have been applied
to gross revenues to reflect
transportation costs, insurances
and commissions.
All prices are based on
2016 constant United States
dollars.
==================================== ============================================================
The derivation of assumptions U(3) O(8) pricing forecasts
made of metal or commodity are based on the latest
price(s), for the principal published long term contract
metals, minerals and pricing forecasts (LT mid-range)
co-products. from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030.
==================================== ============================================================
Market The demand, supply and The uranium market is currently
assessment stock situation for characterised by high inventory
the particular commodity, levels, oversupply and depressed
consumption trends and demand levels, largely due
factors likely to affect to the ongoing effects of
supply and demand into the Fukushima disaster in
the future. Japan in 2011 which resulted
in the closure of all Japanese
nuclear reactors. The spot
uranium price has fallen
in response, and most mines
are currently operating
at or near marginal cost,
with significant production
now coming off stream by
higher cost producers. A
major increase in demand
is expected from China and
India where large scale
reactor build programs are
ongoing. Analyst consensus
forecast is for the uranium
market to turn into deficit
around 2021/2022 when price
recovery is expected to
increase significantly to
the analyst consensus long
term incentive price of
US$65/lb
==================================== ============================================================
A customer and competitor Customers are expected to
analysis along with originate from the US, Asia
the identification of (in particular China, Japan
likely market windows and India) and Europe and
for the product. will either be large nuclear
utilities or trading houses.
The company is currently
in discussions with numerous
global utilities and trading
houses regarding off-take
contracts and is confident
that demand will exist for
its product from the commencement
of production and throughout
the life of mine.
==================================== ============================================================
Price and volume forecasts Uranium revenues are based
and the basis for these on the latest published
forecasts. long term contract pricing
forecasts (LT mid-range)
from UxC. Prices escalate
from US$39.1/lb in 2017
to US$67.7/lb by 2030. The
company considers this a
conservative estimate of
long term prices, with analyst
consensus forecasts reaching
US$65 per pound long term.
Volume sold averages 3.5X
m lbs per annum over the
life of mine and is based
on the Company's expectations
that sufficient demand exists
from Asian, US and European
customers for such material.
==================================== ============================================================
For industrial minerals Not applicable
the customer specification,
testing and acceptance
requirements prior to
a supply contract.
==================================== ============================================================
Economic The inputs to the economic The Salamanca Project is
analysis to produce made up of the Retortillo,
the net present value Santidad, Zona 7 and Alameda
(NPV) in the study, sites. Although the ore
the source and confidence reserves discussed in this
of these economic inputs Table 1 represent the Retortillo
including estimated and Santidad sites only
inflation, discount the project has been evaluated
rate, etc. as a whole and the following
information relating to
the financial evaluation
represents the input parameters
and results for the entire
project.
The after-tax NPV of the
projected cash flows is
US$531.94 million at an
8-percent (real) discount
rate.
The after-tax internal rate-of-return
is 60 percent.
Capital is projected to
be committed beginning in
2017.
All costs and prices are
based on 2016 constant United
States dollars (zero inflation
assumed).
Up-front Capital Costs
Mining & mine related facilities
= US$22.4 million (US$9.9
million for Retortillo,
US$6.1 million for Zona
7 and US$6.3 million for
Alameda)
Processing & plant related
infrastructure = US$197.1
million (US$78.7 million
for Retortillo, US$50.3
million for Zona 7 and US$68.1
million for Alameda)
Other capex including G&A
= US$ 15.1 million (US$7.1
million for Retortillo,
US$2.7 million for Zona
7 and US$5.3 million for
Alameda)
Up-front capital costs =
US$.95.7 million
A contingency of 6% applied
to capex requirements for
all Project facilities.
Production (tons)
Total Tonnes Mined over
Life-of-Mine = 61.3 million
(16.1 million tonnes at
Retortillo, 18.8 million
tonnes at Zona 7 and 26.5
million tonnes at Alameda)
Plant recovery = 87% for
Retortillo, 93% for Zona
7, and 82% for Alameda
Life of Mine = 13.75 years
Average Production Steady
State = 4.4 million pounds
U(3) 0(8)
Average Life of Mine Production
= 3.5 million pounds U(3)
0(8)
Total U(3) 0(8) Produced
Life-of-Mine = 48.6 million
pounds
Start of Construction =
2017
Start of Production = 2018
Cash flow
Average Sales Price Received
= US$52 per pound
Average Cash Operating Costs
= US$15.4 per pound
Average Annual Operating
Earnings before
Interest, Taxes, Depreciation
and
Amortization (EBITDA) (steady
state) = US$144.8
million
NPV = $531.94 million
Internal rate of return
(IRR) = 60%
==================================== ============================================================
NPV ranges and sensitivity The sensitivity study shows
to variations in the the NPV at the 8-percent
significant assumptions (real) discount rate when
and inputs. Base Case annual production
tonnages, sales prices,
operating costs and capital
costs are increased and
decreased in increments
of 5 percent within a +/-10-percent
range. Minus 10% NPV (US$ '000)
----------------- ---------------
Production
(pounds U(3)
O(8) ) 431
----------------- ---------------
Sales price 431
----------------- ---------------
Operating costs 561
----------------- ---------------
Capital costs 554
----------------- ---------------
Minus 5%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 482
----------------- ---------------
Sales price 482
----------------- ---------------
Operating costs 547
----------------- ---------------
Capital costs 543
----------------- ---------------
Base Case
----------------- ---------------
Production
(pounds U(3)
O(8) ) 532
----------------- ---------------
Sales price 532
----------------- ---------------
Operating costs 532
----------------- ---------------
Capital costs 532
----------------- ---------------
Plus 5%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 582
----------------- ---------------
Sales price 582
----------------- ---------------
Operating costs 517
----------------- ---------------
Capital costs 521
----------------- ---------------
Plus 10%
----------------- ---------------
Production
(pounds U(3)
O(8) ) 632
----------------- ---------------
Sales price 632
----------------- ---------------
Operating costs 502
----------------- ---------------
Capital costs 510
----------------- ---------------
==================================== ============================================================
Social The status of agreements An Exploitation plan was
with key stakeholders submitted to the regulatory
and matters leading body, the review of which
to social licence to included a public consultation.
operate. All stakeholders were asked
to provide comments on the
project. A number of questions
were raised and all of them
answered. After the review
of the questions and the
answers and after the review
of all the documents shown
by the company, the project
was authorised by relevant
mining legislation. The
Nuclear Safety Council has
authorised the conceptual
project and is reviewing
the additional information
to authorise the plant construction.
================== ==================================== ============================================================
Other To the extent relevant, None of the 487Ha needed
the impact of the following to develop the project has
on the project and/or been purchased yet.
on the estimation and
classification of the
Ore Reserves:
==================================== ============================================================
Any identified material N/A
naturally occurring
risks.
==================================== ============================================================
The status of material No binding marketing arrangements
legal agreements and in place yet, though advanced
marketing arrangements. discussions are underway.
==================================== ============================================================
The status of governmental The key authorisation aspects
agreements and approvals of the project comprise:
critical to the viability - Mining and environmental:
of the project, such Exploitation Project submitted
as mineral tenement - Water uses: not initiated
status, and government - Land use: Not initiated
and statutory approvals. - Radiological protection:
There must be reasonable Not initiated
grounds to expect that
all necessary Government
approvals will be received
within the timeframes
anticipated in the Pre-Feasibility
or Feasibility study.
Highlight and discuss
the materiality of any
unresolved matter that
is dependent on a third
party on which extraction
of the reserve is contingent.
==================================== ============================================================
Classification The basis for the classification Measured mineral resources
of the Ore Reserves have been classified as
into varying confidence Proven ore reserves while
categories. Indicated mineral resources
have been classified as
Probable ore reserves.
==================================== ============================================================
Whether the result appropriately It is the view of the Competent
reflects the Competent Person that the outcomes
Person's view of the of the feasibility study
deposit. undertaken appropriately
reflect the nature and potential
of the deposit to be developed,
viable exploitation is considered
feasible.
==================================== ============================================================
The proportion of Probable All mineral resources are
Ore Reserves that have classified as Indicated
been derived from Measured or Inferred and therefore
Mineral Resources (if only Probable ore reserves
any). have been declared based
on the Indicated mineral
resource inventory.
==================================== ============================================================
Audits The results of any audits Cameron Mining has done
or reviews or reviews of Ore Reserve a review of the mining aspects
estimates. of the project, focusing
on scheduling and pit shell
selection. For processing
purposes Randall Schiefeld
and Russell Bradford have
provided a general review,
focusing first of them on
heap leaching and second
on general structure of
the project
================== ==================================== ============================================================
Discussion Where appropriate a The confidence level is
of relative statement of the relative reflected in the resource
accuracy/ accuracy and confidence classification category
confidence level in the Ore Reserve chosen for the reported
estimate using an approach OR. The definition of current
or procedure deemed Ore Reserves is appropriate
appropriate by the Competent for the level of study and
Person. For example, the geological confidence
the application of statistical imparted by the drilling
or geostatistical procedures grid.
to quantify the relative The reported OR is considered
accuracy of the reserve appropriate and representative
within stated confidence of the grade and tonnage
limits, or, if such at the 90ppm U3O8 cut-off
an approach is not deemed grade.
appropriate, a qualitative
discussion of the factors
which could affect the
relative accuracy and
confidence of the estimate.
==================================== ============================================================
The statement should All ore reserves declared
specify whether it relates have been based on Indicated
to global or local estimates, mineral resources, no inferred
and, if local, state material has been accounted
the relevant tonnages, for in the mining plan.
which should be relevant
to technical and economic
evaluation. Documentation
should include assumptions
made and the procedures
used.
==================================== ============================================================
Accuracy and confidence It is considered that all
discussions should extend modifying factors applied
to specific discussions to generate the ore reserve
of any applied Modifying estimates have been developed
Factors that may have to a level of accuracy required
a material impact on to support a feasibility
Ore Reserve viability, study.
or for which there are
remaining areas of uncertainty
at the current study
stage.
==================================== ============================================================
It is recognised that No production has been carried
this may not be possible out at Alameda.
or appropriate in all
circumstances. These
statements of relative
accuracy and confidence
of the estimate should
be compared with production
data, where available.
================== ==================================== ============================================================
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCUSARRNOABARR
(END) Dow Jones Newswires
July 14, 2016 02:00 ET (06:00 GMT)
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