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RAMELIUS RESOURCES LIMITED Capital/Financing Update 2020
65718_rns_2020-06-29_796928cc-93ae-4612-8be8-48553bdfe233.pdf
Capital/Financing Update
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30 June 2020
ISSUED CAPITAL Ordinary Shares: 806M
DIRECTORS
NON-EXECUTIVE CHAIRMAN: Kevin Lines MANAGING DIRECTOR: Mark Zeptner NON-EXECUTIVE DIRECTORS: Michael Bohm David Southam Natalia Streltsova
COMPANY SECRETARY: Richard Jones
www.rameliusresources.com.au [email protected]
RAMELIUS RESOURCES LIMITED
Registered Office
Level 1, 130 Royal Street East Perth WA 6004 Tel +61 8 9202 1127 PO Box 6070 East Perth, WA 6892
30 June 2020
RAMELIUS EXTENDS LIFE OF MINE PLAN BY 34% TO 1.45Moz
HIGHLIGHTS
- New 1.45Moz Au Life-of-Mine Plan (LOMP) primarily across 6 years to FY2026, with a tail out to FY2028, which is 34% higher than previous
- Average All-in Sustaining Costs (AISC) over life of mine at A$1,250 - A$1,350/oz
- LOMP consists predominantly of Ore Reserves and Indicated Mineral Resources with only 12% of gold produced from Inferred Resources#
- Penny Gold Project Pre-Feasibility Study (PFS) results indicating production of 230koz at an AISC of A$703/oz, development commencing Dec Qtr 2021
- Additional year of mine life from Vivien now included in FY2021
- Eridanus Stage 2 cut-back included to reflect larger open pit out to FY2023
- Eridanus underground included based on Preliminary Scoping Study work, from FY2024, with further studies ongoing
- Tampia Gold Project (90% owned) capital costs significantly reduced based on Feasibility Study results, with production commencing in FY2022
- Work commenced on Galaxy/Morning Star underground options, mill expansion project at Mt Magnet and re-visit of the Stage 3 open pit at Edna May
- A$25-30M exploration budget allocated for FY2021, spread across the portfolio
Ramelius Resources Limited (ASX:RMS) ("Ramelius", "the Company") is pleased to provide a further update to its LOMP, along with associated updated Mineral Resource and Ore Reserve positions for the Penny Gold Project, from its portfolio of assets located in Western Australia (refer Figure 11).
This new mine plan confirms the Ramelius' ability to produce in excess of 1.4Moz gold at an average AISC of A$1,250 - A$1,350/oz over a six year mine life with the potential to deliver further resource extensions from current operations, whilst retaining the ability to also grow through acquisition.
In addition, Ramelius has incorporated the results of the PFS for the Company's newly acquired Penny Gold Project south-east of Mt Magnet in Western Australia. The study has demonstrated exceptional grade and margins that promise to return significant cashflows to the Company from late FY2022.
Ramelius Managing Director, Mark Zeptner, said "Building on last year's landmark result of over 1Moz contained within a detailed mine plan, the forward outlook of almost 1.5Moz following a record production year in FY20, is a very pleasing result for Ramelius. It is a further testament to the work done by all our team that we can articulate a longer term plan with production scale, strong margins and an achievable approach to reserve replacement that gives us confidence that this visibility around mine life can be extended going forward."
The Company advises it will hold a teleconference to provide investors, analysts and media an opportunity to discuss this update. The teleconference will be held at 11am AEST, 30 June 2020 with details provided at the end of this ASX Release.
**#**Cautionary Statement: The Life of Mine plan contains Inferred Mineral Resources, refer to bottom page 3
UPDATED LIFE OF MINE PLAN PROFILE
Figure 1 below outlines annual production targets and the relative contributions to group gold production from the Mt Magnet and Edna May production centres, with the Penny Gold Project highlighted as part of the Mt Magnet profile. Group gold production in the FY2021 year is now predicted to be higher (270koz) than previously estimated (250koz).
Figure 1 – Ramelius Group Production profile
Table 1 below outlines ranges for group gold production, AISC, capital expenditure and exploration expenditure expectations per financial year:
| Table 1 – Gold Production, AISC per Ounce and Capex | ||||
|---|---|---|---|---|
| ----------------------------------------------------- | -- | -- | -- | -- |
| FY20211 | FY2022 | FY2023 | FY2024 | FY2025 | FY2026+ | Total /Average | |
|---|---|---|---|---|---|---|---|
| Production (koz) | 260 - 280 | 255 - 275 | 250 - 270 | 265 - 285 | 190 - 210 | 170-190 | 1,450 |
| AISC (A$/oz) | 1,230 - 1,330 | 1,325 - 1,425 | 1,200 - 1,300 | 1,100 - 1,200 | 1,100 - 1,200 | 1,750 - 1,850 | 1,250 - 1,350 |
| Capital (A$M) | 55 - 65 | 35 - 45 | 40 - 50 | 15 - 25 | 20 - 30 | 0 – 10 pa | 175 - 245 |
| Exploration (A$M) | 25 - 30 | 20 - 25 | 20 - 25 | 20 - 25 | 20 - 25 | 10 - 15 pa | 135 - 175 |
| TOTAL (A$M) | 80 - 95 | 55 - 70 | 60 - 75 | 35 - 50 | 40 - 55 | 10 - 25 pa | 310 - 420 |
1A breakdown of Quarterly gold production by individual source, AISC, Capital & Exploration requirements for FY2021 will be provided in June 2020 Quarterly Activities Report, as per the Company's normal reporting practice.
Mt Magnet Processing
The milling profile for Mt Magnet over the life of mine plan sees a continued mix of base load, large tonnage open pit ore sources of Eridanus and Morning Star and high grade underground mines such as Vivien, Hill 60, Shannon and the Penny Gold Project. Detailed scheduling has been completed to ensure a balance between high and low grade feed sources as well as oxide, transitional and fresh material to ensure optimal milling rates. The processing plant runs consistently at a rate of 1.9–2.0Mtpa.
Edna May Processing
The throughput rate at Edna May is expected to reduce from its current 2.7Mtpa nameplate capacity to a 2.1Mtpa rate to accommodate the need for a finer grind (125um) for the Tampia ore, which will become the base load ore feed from the start of FY2022. The reduction in throughput will be more than offset by a significant increase in average grade through the mill. The historical 1.0–1.2g/t Edna May open cut material will be replaced by higher grade Marda (2.0 g/t) and Tampia (2.5 g/t) material.
ORE RESERVE & MINERAL RESOURCE CONTRIBUTION TO GROUP LIFE OF MINE PLAN #
The new LOMP is based predominantly on Ore Reserves with a small contribution from Mineral Resources that, in the view of Ramelius, are likely to be converted to Ore Reserves in the future (refer Figure 2).
Figure 2 – Life of Mine Production by JORC Category
#The LOMP is a Production Target that contains a proportion of Inferred Mineral Resources (12%). There is a low level of geological confidence associated with inferred mineral resources and there is no certainty that further exploration work will result in the determination of indicated mineral resources or that the production target itself will be realised
COMPARISON TO JUNE 2019 LOMP
Comparing the new LOMP with the previous one published in June 2019~ (refer Figure 3) shows both a longer mine life and production at a higher annual rate, leading to a 34% increase in total ounces.
The key drivers of this positive change revolve around the expanded mining operations at the Eridanus open pit as well as the early results of a preliminary scoping study into a bulk mining operation beneath the base of the planned Eridanus pit. The contribution from the recently acquired Penny Gold Project has added significant, low cost ounces to the LOMP.
Figure 3 – LOMP Comparison
~See RMS ASX Release, "Life of Mine and Tampia Updates with conference call info", 17 June 2019. *Refer previous comment on years FY26-28.
PENNY GOLD PROJECT (WA) – PRE-FEASIBILITY STUDY & MAIDEN ORE RESERVES
Summary
Ramelius is pleased to provide the results of its Penny Gold Project Pre-Feasibility Study (PFS) for the development of the project. The PFS focused on the option to haul ore to Ramelius' Mt Magnet processing facility, as the preferred option under Ramelius ownership. Some of the key physical and financial outcomes are included in Table 2 below.
| Table 2 – Penny Gold Project PFS Results | |
|---|---|
| -- | ------------------------------------------ |
| Parameter | Unit | Pre-Feasibility Study |
|---|---|---|
| (June 2020) | ||
| General | ||
| Start Date (open pit cut-back) | Qtr | September 2021 Quarter |
| Initial life | Yrs | 3.8 |
| Mining (open pit) | ||
| Ore tonnes (high grade) | kt | 13 |
| Grade | g/t | 5.1 |
| Contained Gold | koz | 2 |
| Mining (underground) | ||
| Ore tonnes (high grade) | kt | 571 |
| Grade | g/t | 13.3 |
| Contained Gold | koz | 248 |
| Processing | ||
| Ore processed | Mt | 584 |
| Grade | g/t | 13.3 |
| Gold fed | koz | 250 |
| Recovery | % | 92 |
| Gold Production | koz | 230 |
| Financial | ||
| Upfront Capital Cost | A$M | 23.5 |
| AISC | A$/oz | 703 |
Location & History
The Penny Gold Project is located approximately 150km south-east of Ramelius' Mt Magnet mining and processing operations and approximately 550km north-east of Perth in Western Australia. The Penny West (PW) deposit was discovered in 1990 and mined as a high-grade open pit in 1990/91 producing approximately 154,000t @ 18.0g/t Au for 89,000oz. Minor exploration was conducted over following years by a number of companies until Spectrum Metals discovered the Penny North (PN) lode zone in March 2019. Ramelius acquired the project in 2020 via an off-market takeover offer of Spectrum Metals.
Geology & Mineralisation
Gold mineralisation is hosted within large, quartz-sulphide lode veins occuring within a steeply dipping greenstone stratigraphy dominated by mafic and ultramafic units and with minor felsic and granitoid intrusive units. The Penny West & North lodes occur at or proximal to a felsic schist–mafic amphibolite contact and slightly cross-cut stratigraphy. The lodes are typically 2-6m thick, dip east at 50°- 65° and both have strike and dip extents of 350m and 250m respectively. Gold mineralisation is nuggety and closely correlates with sulphide rich zones of pyrrhotite, pyrite, galena, sphalerite and minor chalcopyrite. The Magenta deposit is a smaller lode of a similar mineralisation style occuring 1.4km north of the Penny area.
Mineral Resource
Ramelius has generated a new resource estimate which includes a number of recent diamond holes. The lode interpretation generally utilises a slightly thinner lode interpretation and stronger emphasis on the core quartz-sulphide lode zone. Discontinuous hangingwall mineralisation was not modelled, but some further scope for definition of these zones will occur during underground mining.
| Indicated | Inferred | Total | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Lode | tonnes | g/t | ounces | tonnes | g/t | ounces | tonnes | g/t | ounces |
| Penny North | 360,000 | 21.2 | 240,000 | 61,000 | 13.0 | 26,000 | 420,000 | 20.0 | 270,000 |
| Penny West | 43,000 | 7.2 | 9,800 | 47,000 | 6.1 | 9,400 | 90,000 | 6.6 | 19,000 |
| Magenta | 19,000 | 4.0 | 2,500 | 92,000 | 2.5 | 7,300 | 110,000 | 2.7 | 9,800 |
| Total | 420,000 | 19.0 | 260,000 | 200,000 | 6.6 | 42,000 | 620,000 | 15.0 | 300,000 |
Figures rounded to 2 significant figures. Rounding errors may occur.
Mineral Resource Commentary
The Penny North lode is based on recent drilling by Spectrum and Ramelius conducted since discovery in early 2019. The lode is directly intersected by 49 RC holes for 11,997m and 6 diamond holes for 1,768m. Penny West and Magenta utilise historic drilling data plus a number of confirmatory new RC & Diamond holes. Sampling was conducted via an RC cone splitter as 1m samples or as sawn half HQ core on 1m or geologically selected intervals. All samples were dispatched to a Perth commercial laboratory and accompanied by appropriate QAQC samples. All sample were analysed by 50g Fire Assay, with many recent lode zone samples assayed using Screen Fire Assay. Geological and mineralisation interpretation was carried out on section spacings of 20-40m (PN) and 10-20m (PW & Magenta). Density values are derived from core SG measurements. Modelling and estimation was carried out using Micromine software. Samples were grouped by domain, composited to 1m intervals and top-cut (circa 98 th percentile). Geostatistical modelling was conducted to generate search directions, ranges and kriging parameters. Estimation was by ordinary kriging and inverse distance, with ID¹ being selected as the final grade value. Resource classification was applied based on geological and grade continuity, drillhole spacing and estimation variance.
Figure 5 – Penny West and North, looking west with RC & DD drilling and Mineral Resource wireframes
Ore Reserve
| Mine | Proven | Probable | Total | ||||||
|---|---|---|---|---|---|---|---|---|---|
| tonnes | g/t | ounces | tonnes | g/t | ounces | tonnes | g/t | ounces | |
| Penny North UG | - | - | - | 490,000 | 15.0 | 230,000 | 490,000 | 15.0 | 230,000 |
| Magenta OP | - | - | - | 12,000 | 4.0 | 1,500 | 12,000 | 3.9 | 1,500 |
| Total | - | - | - | 500,000 | 14.0 | 230,000 | 500,000 | 14.0 | 230,000 |
Figures rounded to 2 significant figures. Rounding errors may occur.
The project financial model mining inventory is inclusive of 100% of the Ore Reserves and a portion of Inferred Resource, making up 14% tonnes and 7% ounces of the total project financial model mining inventory.
Ore Reserve Commentary
Ore Reserves are based on the resource models referenced above.
The Magenta Resource Model including parent block size of 2.5mE x 5mN x 2.5mRL and variable sub-blocks to 1mE x2mN x 1mRL (unregularized) was used as the evaluation model. Pit optimisations and designs was carried out using appropriate mining and ore costs, mining recovery and dilution factors, wall angles, mill recoveries and a A$2,300/oz gold price.
The Penny West Resource Model was evaluated on Indicated Resource only though did not generate an economic and mineable pit shell. A cut back pit design was completed for the existing Penny West open pit to provide a suitable location for the development of the Penny North underground main decline portal and ventilation and egress adits. A 65m deep cut-back has been designed to allow for portal and adits to be approximately 10m below the predicted transitional/fresh rock interface.
The Penny North underground design and mining method consists of a conventional small-scale mechanised design with a decline portal and ventilation and egress adits developed from the base of the Penny West pit cutback. The stoping method is conventional longhole drilling and blasting of up-hole bench stopes with a combination of in-situ pillars and cement rock fill stope support (refer Figure 6). Open pit and underground ore will be hauled along existing access and government roads to the Mt Magnet plant for processing.
Open pit and underground mining and ore haulage costs were based on current contractor unit rates at current Ramelius operations. Milling costs were based on current costs at the Mt Magnet Gold Project Checker Processing plant. Open pit design work included use of external geotechnical recommendations and groundwater studies.
Metallurgical test work has been conducted on a single composite sample to derive a recovery of 96% for Magenta open pit Ore Reserve and seven composite samples to derive a recovery of 92% for the Penny North underground Ore Reserve.
Ore Reserves utilise Indicated Resources and are reported above 0.8g/t Au grade for open pit and 3.0g/t Au for underground. Detailed information is provided in the JORC Table 1 in Attachment A.
Figure 6 – Penny North underground mine design and Penny West partial pit cutback, looking East
Indicative Development Timeline
The Company generally will develop its projects on an "as soon as possible" basis, and this is expected to be the case with the high-grade Penny Gold Project. As shown in Figure 7, the development of new projects involves a number of requirements, often with limited flexibility within the schedule. Notwithstanding this, the operations team will endeavour to pull the project forward if at all possible, which will have a positive impact on gold production in FY2022 if so.
Figure 7 – Indicative timeline for development of the Penny Project
ERIDNAUS UNDERGROUND (MT MAGNET, WA) – SCOPING STUDY STATUS
Location & History
The Eridanus open pit is located 7.8 kilometres southwest, by haul road from the Mt Magnet Mill (refer to Figure 8). The Mineral Resource is situated between the historical Lone Pine open pit and the backfilled Theakston open pit. The deposit was discovered by Ramelius in late 2017 and mining of the Stage 1 pit commenced in mid-2019.
Geology & Mineralisation
Eridanus is predominately hosted within a granodiorite intruded into felsic aphyric to porphyritic intrusive rocks. Mineralisation occurs as stockwork veins concentrated around inferred low angle structures within the east-west orientated Eridanus Granodiorite intrusion. The granodiorite has undergone pervasive sericite–carbonate alteration and silica healing manifesting in quartz plus quartz-tourmaline veins. A supergene zone is recognised in the transitional weathered zone between 25-50m depth, below up to 25m of depletion. Given the overall stockwork nature of the gold mineralisation true widths are variable, but the average true width of the mineralised granodiorite is 60m.
Figure 8: Location of Eridanus as part of the Mt Magnet Project
Mineral Resource
| Table 5: Eridanus December 2019 Mineral Resource (+0.6g/t) | |||
|---|---|---|---|
| ------------------------------------------------------------ | -- | -- | -- |
| Measured | Indicated | Inferred | Total | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| tonnes | g/t | ounces | tonnes | g/t | ounces | tonnes | g/t | ounces | tonnes | g/t | ounces |
| 1,500,000 | 1.2 | 56,000 | 5,900,000 | 1.3 | 240,000 | 4,500,000 | 1.3 | 190,000 | 12,000,000 | 1.3 | 490,000 |
Figures rounded to 2 significant figures. Rounding errors may occur.
Eridanus Deeps
Diamond drilling recently completed at Eridanus, including geotechnical drilling skirting the A$2,000/oz pit shell as well as targeted exploration holes below the pit shell down to 400m below surface. Significant intersections were returned (previously reported) with wide composite zones of stockwork style gold mineralisation occurring at depth within the host Eridanus Granodiorite. Assay results were also reported for the final deeper geotechnical diamond drill hole (GXDD0103) completed at Eridanus (refer Figure 9). The drill hole was designed to pierce the full thickness of the Eridanus Granodiorite below the proposed pit. Highly encouraging results were returned and the drill hole, along with adjacent supporting intersections, uses uncut grades and is bulked over the entire geological thickness of the host granodiorite. They returned:
- ➢ 203m at 2.18 g/t Au from 297m in GXDD0103, including 22m at 13.07 g/t Au
- ➢ 114m at 1.11 g/t Au from 288m in GXDD0096A and
- ➢ 103m at 1.19 g/t Au from 319m in GXDD0097
Figure 9 - North-south cross section 576750mE with a 10m search (looking west) through Eridanus, highlighting GXDD0103
Scoping Study Status
Remodelling of the Eridanus Deeps area, from the base of the current open pit down to 430mbs, remains ongoing in order to incorporate all drilling (including diamond hole GXDD0103), as well as in-pit grade control drilling and further geological understanding gained from open pit mining and geological mapping. Mining of the Stage 1 open pit has revealed a number of large high-grade veins cross-cutting the host granodiorite (refer Figure 10). The higher grades associated with these vein sets is being incorporated into new modelling of the Eridanus orebody and this work is expected to be completed in the September 2020 Quarter.
Figure 10 – Plan view of the Eridanus open pit showing multiple veins (RHS) and a photo of a vein set in the pit wall (LHS)
In terms of the LOMP, an early stage bulk underground mining option is included based on the December 2019 Mineral Resource, with the following key parameters as shown in Table 6.
| Parameter | Unit | Preliminary Scoping Study(June 2020) |
|---|---|---|
| General | ||
| Start Date (decline development) | Qtr | December 2023 Quarter |
| Initial life | Yrs | 3.0 |
| Mining (underground) | ||
| Ore tonnes | Mt | 2.0 |
| Grade | g/t | 1.6 |
| Contained Gold | koz | 103 |
| Processing | ||
| Ore processed | Mt | 2.0 |
| Grade | g/t | 1.6 |
| Recovery | % | 95.0 |
| Gold Production | koz | 98 |
| Financial | ||
| Upfront Capital Cost | A$M | 30 |
| AISC | A$/oz | 1,559 |
| Table 6 – Eridanus Bulk Underground | |
|---|---|
It is expected that Scoping Study results based on the new resource model will focus more on a lower tonnage, higher grade portion of the Eridanus orebody, that will potentially deliver lower cost ounces into subsequent mine plan updates.
MINING/PROCESSING STUDIES & RESOURCE CONVERSION
The Company plans to leverage its large resource base^, particularly at Mt Magnet and Edna May, over the next 12 months to ultimately produce a longer LOMP with higher conversion of resources. Ramelius notes that any increase in production that is largely due to the higher gold price environment we are currently operating in will generally lead to higher underlying operating costs due to a lower cut-off grade being applied to design parameters. Notwithstanding, mining/processing studies that are currently planned for FY2021 include:
Mt Magnet
- Galaxy (Saturn, Mars, Titan & Hill 50) underground studies to look at options to convert approximately 470koz^ of mineral resources into the LOMP
- Morning Star underground study to consider the 79koz^ mineral resource currently at depth as well as other nearby opportunities
- Eridanus/Shannon/Stellar continue work on the bulk underground option at Eridanus as well as accelerate extensional drilling at Shannon and considering underground opportunities below the high-grade pod at the base of the Stellar pit
- Processing facility the processing plant, currently operating between 1.9-2.0Mtpa, has previously operated up to 2.4Mtpa with additional secondary crushing, ball mill and leach tanks being decommissioned in the early 2000's. The team is currently carrying out a cost/benefit analysis on this upgrade option which, based on previous studies, could be carried out for less than A$20M.
Edna May
- Edna May underground carry out study on bulk underground option and compare to current high-grade lode only mine plan which focuses primarily on the Fuji and Jonathan lodes
- Edna May Stage 3 re-visit the large cutback on the original Stage 2 pit to potentially unlock over 500koz^ of lower grade resources which would potentially secure a mine life at Edna May out towards 10 years
This ASX announcement was authorised for release by the Board of Directors. For further information contact:
| Investor enquiries: | Media enquiries: | |
|---|---|---|
| Mark Zeptner | Tim Manners | Luke Forrestal |
| Managing DirectorRamelius Resources LtdPh: +61 8 9202 1127 | Chief Financial OfficerRamelius Resources LtdPh: + 61 8 9202 1127 | AssociateDirectorMedia & Capital PartnersPh: +61 411 479 144 |
CONFERENCE CALL
Details for the conference call to be held at 9am (WST) / 11am (AEST), Tuesday 30 June 2019 are as follows: Within Australia (Toll Free): 1800 809 971 Alternate Australia (Toll Free): 1800 558 698 International: +61 2 9007 3187 Conference ID: 10000767
Alternatively, participants can register for the call by navigating to:
https://services.choruscall.com.au/diamondpass/rameliusresources-10000767.html
Please note that registered participants will receive their dial-in number upon registration.
ABOUT RAMELIUS
Ramelius Resources Limited (ASX:RMS) is a Western Australian gold producer that has been listed on the ASX since 2003 and in production since 2006. Ramelius owns and operates the Mt Magnet, Edna May, Vivien, Penny and Marda gold mines and owns a 90% interest in the Tampia Hill gold project, all in Western Australia (refer Figure 11).
Ore from the high-grade Vivien underground mine, located near Leinster, is trucked to the Mt Magnet processing plant where it is blended with ore from both underground and open pit sources. The Edna May operation currently processes ore from its underground operations, the nearby Greenfinch open pit and hauled ore from the Marda gold mine.
Ramelius reported a 329% increase in its Net Profit after Tax for the 6 months to December 2019 of A$20.5M. The financial performance was achieved on the back of production for the 6 months of 92,084 ounces of gold at an AISC of A$1,240/oz for the half-year. Further to this, Ramelius has recently upgraded its guidance for the 2020 Financial Year of 225,000-230,000 ounces of gold produced at an AISC of A$1,150-$1,250/oz.
Figure 11 – Ramelius' Production Centre and Development Project locations
FORWARD LOOKING STATEMENTS
This report contains forward looking statements. The forward looking statements are based on current expectations, estimates, assumptions, forecasts and projections and the industry in which it operates as well as other factors that management believes to be relevant and reasonable in the circumstances at the date such statements are made, but which may prove to be incorrect. The forward looking statements relate to future matters and are subject to various inherent risks and uncertainties. Many known and unknown factors could cause actual events or results to differ materially from the estimated or anticipated events or results expressed or implied by any forward looking statements. Such factors include, among others, changes in market conditions, future prices of gold and exchange rate movements, the actual results of production, development and/or exploration activities, variations in grade or recovery rates, plant and/or equipment failure and the possibility of cost overruns. Neither Ramelius, its related bodies corporate nor any of their directors, officers, employees, agents or contractors makes any representation or warranty (either express or implied) as to the accuracy, correctness, completeness, adequacy, reliability or likelihood of fulfilment of any forward looking statement, or any events or results expressed or implied in any forward looking statement, except to the extent required by law.
PREVIOUSLY REPORTED INFORMATION
Information in this report references previously reported exploration results and resource information extracted from the Company's ASX announcements. For the purposes of ASX Listing Rule 5.23 the Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements and that all material assumptions and technical parameters underpinning the estimates in the relevant market announcements continue to apply and have not materially changed.
COMPETENT PERSONS
The information in this report that relates to Exploration Results, Exploration Targets, Mineral Resources and Ore Reserves is based on information compiled by Kevin Seymour (Exploration Results & Exploration Targets), Rob Hutchison (Mineral Resources) and Duncan Coutts (Ore Reserves), who are Competent Persons and Members of The Australasian Institute of Mining and Metallurgy. Kevin Seymour, Rob Hutchison and Duncan Coutts are full-time employees of the company. Kevin Seymour, Rob Hutchison and Duncan Coutts have sufficient experience that is relevant to the style of mineralisation 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". Kevin Seymour, Rob Hutchison and Duncan Coutts consent to the inclusion in this report of the matters based on their information in the form and context in which it appears.
Attachment A: JORC Table 1 Report Penny Project
Section 1 Sampling Techniques and Data
| Criteria | JORC Code explanation | Commentary |
|---|---|---|
| Samplingtechniques | •Nature and quality of sampling (eg cutchannels, random chips, or specific specialisedindustry standard measurement toolsappropriate to the minerals under investigation,such as down hole gamma sondes, orhandheld XRF instruments, etc). Theseexamples should not be taken as limiting thebroad meaning of sampling.•Include reference to measures taken to ensuresample representivity and the appropriatecalibration of any measurement tools orsystems used.•Aspects of the determination of mineralisationthat are Material to the Public Report.•In cases where 'industry standard' work hasbeen done this would be relatively simple (eg'reverse circulation drilling was used to obtain 1m samples from which 3 kg was pulverised toproduce a 30 g charge for fire assay'). In othercases more explanation may be required, suchas where there is coarse gold that has inherentsampling problems. Unusual commodities ormineralisation types (eg submarine nodules)may warrant disclosure of detailed information. | •Over 95% of sampling was conducted using 1m intervalscollected from reverse circulation (RC) drill holes. Surfacediamond holes are sampled on 1m or geologically selectedsub metre intervals.•RAB drilling occurs and is excluded from resourcemodelling with a few minor exceptions.•Drill hole locations were designed to allow for spatialspread across the interpreted mineralised zone. All RCsamples were collected and split to 3-4kg samples on 1mmetre intervals. Diamond core is half cut along downholeorientation lines. Half core is sent to the laboratory foranalysis and the other half is retained for future reference.•Standard fire assaying was employed using a 50gmcharge with an AAS finish for all samples. Screen fireassay methods were used for some selected mineralisedzones. |
| Drillingtechniques | •Drill type (eg core, reverse circulation, openhole hammer, rotary air blast, auger, Bangka,sonic, etc) and details (eg core diameter, tripleor standard tube, depth of diamond tails, facesampling bit or other type, whether core isoriented and if so, by what method, etc). | •Drilling was completed using 5 ¾" face sampling RCdrilling hammers for all RC drill holes. Diamond drillingused HQ and NQ diamond core. Most core holes weredrilled as tails from 100m to 200m RC precollars. RABholes were completed using 4" blade bits or hammers. |
| Drill samplerecovery | •Method of recording and assessing core andchip sample recoveries and results assessed.•Measures taken to maximise sample recoveryand ensure representative nature of thesamples.•Whether a relationship exists between samplerecovery and grade and whether sample biasmay have occurred due to preferentialloss/gain of fine/coarse material. | •RC drill hole samples were visually inspected by thesupervising geologist to ensure adequate clean samplerecoveries were achieved. Cone splitter systems werelevelled before use. All diamond core is jigsawed to ensureany core loss,if present is fully accounted for. Any wet,contaminated or poor sample returns are flagged andrecorded in the database to ensure no sampling bias isintroduced.•Sample recovery in both RC and Diamond is generallyexcellent. |
| Logging | •Whether core and chip samples have beengeologically and geotechnically logged to alevel of detail to support appropriate MineralResource estimation, mining studies andmetallurgical studies.•Whether logging is qualitative or quantitative innature. Core (or costean, channel, etc)photography.•The total length and percentage of the relevantintersections logged. | •Samples are geologically logged on site by geologists.Details on the rock type, mineralogy, fabrics and texturesare recorded.•Drill hole logging is qualitative on visual inspection of rockforming minerals and on estimates of mineral abundance.A number of HQ geotechnical diamond holes were drilledas core from surface and have been logged by ageotechnical consultant to support the mining study.•The entire length of each drill hole is geologically logged. |
| Sub-samplingtechniques andsamplepreparation | •If core, whether cut or sawn and whetherquarter, half or all core taken.•If non-core, whether riffled, tube sampled,rotary split, etc and whether sampled wet ordry. | •Core samples were sawn and half core sampled.•Most RC 1m samples were split to a 3kg target subsample via a cone splitter. Some samples were collectedas 4m spear composites in zones of geologicallydetermined waste rock. |
| •For all sample types, the nature, quality andappropriateness of the sample preparationtechnique.•Quality control procedures adopted for all subsampling stages to maximise representivity ofsamples.•Measures taken to ensure that the sampling isrepresentative of the in situ material collected,including for instance results for fieldduplicate/second-half sampling.•Whether sample sizes are appropriate to thegrain size of the material being sampled. | •Samples are appropriate for type of mineralisation andanalysis.•All core and RC samples are crushed & pulverized prior tosplitting in the laboratory to ensure homogenous samples.200gm is extracted by spatula that is used for the 50gm or30 gm charge on standard fire assays.•Significant numbers of mineralised duplicate samples weregeologically selected and submitted. Analysis of duplicatesshows satisfactory performance.•The sample size is considered appropriate for the type,style, thickness and consistency of mineralization. | |
|---|---|---|
| Quality ofassay data andlaboratory tests | •The nature, quality and appropriateness of theassaying and laboratory procedures used andwhether the technique is considered partial ortotal.•For geophysical tools, spectrometers,handheld XRF instruments, etc, theparameters used in determining the analysisincluding instrument make and model, readingtimes, calibrations factors applied and theirderivation, etc.•Nature of quality control procedures adopted(eg standards, blanks, duplicates, externallaboratory checks) and whether acceptablelevels of accuracy (ie lack of bias) andprecision have been established. | •The fire assay method and AAS finish is used for mostsamples. Screen fire assay method has been applied tosome recent lode zones and is also appropriate.•No field analyses of gold grades are completed.Quantitative analysis of the gold content is undertaken in acontrolled laboratory environment.•Handheld pXRF analysis of mineralised zones but issuperceded by multi-element lab analysis for significantelements including, Pb, Zn and Ag.•Industry best practice was employed with the inclusion ofduplicates and standards. Standards and blanks areinterrogated to ensure they lie within acceptabletolerances. |
| Verification ofsampling andassaying | •The verification of significant intersections byeither independent or alternative companypersonnel.•The use of twinned holes.•Documentation of primary data, data entryprocedures, data verification, data storage(physical and electronic) protocols.•Discuss any adjustment to assay data. | •Ramelius personnel have inspected the diamond core andRC chips in the field to verify the correlation of mineralisedzones between assay results and lithology, alteration andmineralization.•Twinned or close spaced holes exist and are usedsignificantly at Penny West and Magenta where historicdrilling occurs.•Holes are digitally logged in the field and data is collectedin auto validating spreadsheets. These sheets were loadedinto an Access database using scripting and furthervalidation steps. Data was then exported to Micromine forvisual validation by the Project & Resource Geologists.•The responsible geologist makes the DBA aware of anyerrors and/or omissions to the database and thecorrections (if required) are corrected in the databaseimmediately.•No adjustments or calibrations are made to any of theassay data recorded in the database. |
| Location ofdata points | •Accuracy and quality of surveys used to locatedrill holes (collar and down-hole surveys),trenches, mine workings and other locationsused in Mineral Resource estimation.•Specification of the grid system used.•Quality and adequacy of topographic control. | •All drill hole collars are picked up using accurate DGPSsurvey control by a commercial survey contractor. Alldown hole surveys are collected using downhole gyrosurveying technique provided by the drilling contractors.•All holes were picked up in MGA94 – Zone 50 gridcoordinates.•An accurate topographic surface has been establishedfrom a recent aerial survey and is used to check DGPSsurveys. |
| Data spacingand distribution | •Data spacing for reporting of ExplorationResults.•Whether the data spacing and distribution issufficient to establish the degree of geologicaland grade continuity appropriate for theMineral Resource and Ore Reserve estimation | •Penny North - the dominant spacing is a 40m section x30m grid with selected 20m section infill holes. PennyWest and Magenta hole spacings are variable with manydrilled on a 20m x 10m pattern.•Drill spacing is sufficient to establish appropriate continuityand classifications. |
| Orientation ofdata in relationto geologicalstructure | procedure(s) and classifications applied.•Whether sample compositing has beenapplied.•Whether the orientation of sampling achievesunbiased sampling of possible structures andthe extent to which this is known, consideringthe deposit type.•If the relationship between the drillingorientation and the orientation of keymineralised structures is considered to haveintroduced a sampling bias, this should beassessed and reported if material. | •No physical compositing has been applied withinmineralised intervals.•The drilling is completed orthogonal to the interpretedstrike and dip of the mineralisation.•No orientation bias is evident |
|---|---|---|
| Samplesecurity | •The measures taken to ensure samplesecurity. | •All bagged samples are collected by the small Penny teamand driven directly to the laboratory in Perth, whereuponthe laboratory checks the physically received samplesagainst sample submissions. |
| Audits orreviews | •The results of any audits or reviews ofsampling techniques and data. | •No external audits have been completed to date. |
Section 2 Reporting of Exploration Results
| Criteria | JORC Code explanation | Commentary |
|---|---|---|
| Mineraltenement andland tenurestatus | • Type, reference name/number, location andownership including agreements or materialissues with third parties such as joint ventures,partnerships, overriding royalties, native titleinterests, historical sites, wilderness or nationalpark and environmental settings.• The security of the tenure held at the time ofreporting along with any known impediments toobtaining a licence to operate in the area. | • The results reported in this report are located on grantedMining Leases (ML) owned by Zebra Minerals Pty Ltd,which is under Compulsory Acquistion by RameliusResources Ltd.• Currently all the tenements are in good standing. There areno known impediments to obtaining a licences to operate ineither area. |
| Exploration doneby other parties | • Acknowledgment and appraisal of explorationby other parties. | • The Penny West deposit was discovered and mined in1990/91. Numerous other companies have held and/orexplored the area including Eastmet, Metana, GMA,Goldcrest, Apex and Plateaux. |
| Geology | • Deposit type, geological setting and style ofmineralisation. | • Penny lodes are hosted within an Archaean mafic-felsicgreenstone belt. Gold mineralisation is hosted within astructurally controlled quartz-sulphide vein associated withpyrite, pyrrhotite, galena, sphalerite and chalcopyrite.• Lodes occur at or proximal to a felsic/mafic schist contactand transgress from one unit to the other. |
| Drill holeInformation | • A summary of all information material to theunderstanding of the exploration resultsincluding a tabulation of the followinginformation for all Material drill holes:o easting and northing of the drill hole collaro elevation or RL (Reduced Level – elevationabove sea level in metres) of the drill hole collaro dip and azimuth of the holeo down hole length and interception deptho hole length.• If the exclusion of this information is justified onthe basis that the information is not Material andthis exclusion does not detract from theunderstanding of the report, the CompetentPerson should clearly explain why this is thecase. | • No new drill hole information is reported• Previous reporting of Penny intercepts has been made inprior releases with all appropriate information included. |
| Data aggregationmethods | • In reporting Exploration Results, weightingaveraging techniques, maximum and/orminimum grade truncations (eg cutting of highgrades) and cut-off grades are usually Materialand should be stated.• Where aggregate intercepts incorporate shortlengths of high grade results and longer lengthsof low grade results, the procedure used forsuch aggregation should be stated and sometypical examples of such aggregations shouldbe shown in detail.• The assumptions used for any reporting ofmetal equivalent values should be clearlystated. | • Weighted average techniques are applied to determine thegrade of the lode intervals when geological intervals areless than 1m (core samples)• Exploration drilling results are generally reported using anominal 0.5 g/t Au lower cut-off. Sub grade values may beincorporated if within geological lode interval or making up aminimum width (2-3m downhole).• No metal equivalent reporting is used or applied. |
|---|---|---|
| Relationshipbetweenmineralisationwidths andintercept lengths | • These relationships are particularly important inthe reporting of Exploration Results.• If the geometry of the mineralisation withrespect to the drill hole angle is known, itsnature should be reported.• If it is not known and only the down hole lengthsare reported, there should be a clear statementto this effect (eg 'down hole length, true widthnot known'). | • No new results reported |
| Diagrams | • Appropriate maps and sections (with scales)and tabulations of intercepts should be includedfor any significant discovery being reportedThese should include, but not be limited to aplan view of drill hole collar locations andappropriate sectional views. | • Example maps and sections are included in previousreleases |
| Balancedreporting | • Where comprehensive reporting of allExploration Results is not practicable,representative reporting of both low and highgrades and/or widths should be practiced toavoid misleading reporting of ExplorationResults. | • Most drill holes completed to date are reported in previousreleases and all material intersections are reported. |
| Othersubstantiveexploration data | • Other exploration data, if meaningful andmaterial, should be reported including (but notlimited to): geological observations; geophysicalsurvey results; geochemical survey results; bulksamples – size and method of treatment;metallurgical test results; bulk density,groundwater, geotechnical and rockcharacteristics; potential deleterious orcontaminating substances. | • No other exploration data that has been collected isconsidered meaningful and material to this report. |
| Further work | • The nature and scale of planned further work(eg tests for lateral extensions or depthextensions or large-scale step-out drilling).• Diagrams clearly highlighting the areas ofpossible extensions, including the maingeological interpretations and future drillingareas, provided this information is notcommercially sensitive. | • Exploration of the wider project area is in progress.Additional resource infill drilling may take place prior tocommencement of mining. |
Section 3 Estimation and Reporting of Mineral Resources
| Criteria | JORC Code explanation | Commentary |
|---|---|---|
| Databaseintegrity | •Measures taken to ensure that data has notbeen corrupted by, for example, transcriptionor keying errors, between its initial collection | •Data was imported from digital logging sheets andvalidated via a number of steps when entered into theAccess database. Validation includes scripting checks and |
| and its use for Mineral Resource estimationpurposes.•Data validation procedures used. | final visual validation by the Resource geologist.•Data was imported from the Access database asMicromine data files for use in the estimate | |
|---|---|---|
| Site visits | •Comment on any site visits undertaken by theCompetent Person and the outcome of thosevisits.•If no site visits have been undertaken indicatewhy this is the case. | •The Competent Person is a full-time employee of RameliusResources and has made two site visits•Visits verified understanding of deposit and availableinformation |
| Geologicalinterpretation | •Confidence in (or conversely, the uncertaintyof) the geological interpretation of the mineraldeposit.•Nature of the data used and of anyassumptions made.•The effect, if any, of alternative interpretationson Mineral Resource estimation.•The use of geology in guiding and controllingMineral Resource estimation.•The factors affecting continuity both of gradeand geology. | •Confidence in the geological interpretation is high.•Data used includes drilling assays & logging, density andmulti-element data from drilling.•No alternate interpretation required•Geology forms a base component in the mineralisationinterpretation. Mineralisation is sub-parallel to stratigraphy. |
| Dimensions | •The extent and variability of the MineralResource expressed as length (along strike orotherwise), plan width, and depth belowsurface to the upper and lower limits of theMineral Resource. | •The Penny North & Penny West deposits both have astrike of 350m, down-dip extent of around 250m andwidths of 2-6m. |
| Estimation andmodellingtechniques | •The nature and appropriateness of theestimation technique(s) applied and keyassumptions, including treatment of extremegrade values, domaining, interpolationparameters and maximum distance ofextrapolation from data points. If a computerassisted estimation method was choseninclude a description of computer software andparameters used.•The availability of check estimates, previousestimates and/or mine production records andwhether the Mineral Resource estimate takesappropriate account of such data.•The assumptions made regarding recovery ofby-products.•Estimation of deleterious elements or othernon-grade variables of economic significance(e.g. sulphur for acid mine drainagecharacterisation).•In the case of block model interpolation, theblock size in relation to the average samplespacing and the search employed.•Any assumptions behind modelling of selectivemining units.•Any assumptions about correlation betweenvariables.•Description of how the geological interpretationwas used to control the resource estimates.•Discussion of basis for using or not usinggrade cutting or capping.•The process of validation, the checkingprocess used, the comparison of model data todrill hole data, and use of reconciliation data ifavailable. | •The interpretation of the mineralised lodes forms the gradedomains. A minimum lode thickness of 2-3m is used.•The resource model was constructed using Microminesoftware.•Grade within the domain is estimated by geologicalsoftware using Inverse Distance¹ within hard boundeddomains. Ordinary Kriging grades were generated andcompared.•Global production numbers for the Penny West pit appearin several reports with grade of 20g/t quoted.•Gold, Ag and Pb grade is estimated•Parent cell of 5mE x 10mN x 5mRL with sub-cells tominimum of 1mE x 2mN x 1mRL. Parent cell estimationonly. The sub-cell size is small to allow for narrow sectionsof the lode to be defined. Parent cells are SMU size orlarger.•Domains are statistically analysed and assignedappropriate search directions, top-cuts and estimationparameters. The search is aligned with the observedgeological strike and dip of the lodes. Lodes domainsestimated separately.•Samples were composited within ore domains to 1mlengths.•Top cuts were applied to domains after review of gradepopulation characteristics. Topcuts used are PN 120 g/t,PW 50 g/t and Magenta 30 g/t.•Validation includes visual comparison against drillholegrades and comparison against previous models. |
| Moisture | •Whether the tonnages are estimated on a drybasis or with natural moisture, and the methodof determination of the moisture content. | •Tonnages are estimated on a dry basis |
|---|---|---|
| Cut-offparameters | •The basis of the adopted cut-off grade(s) orquality parameters applied. | •Reporting cutoff is >2.0 g/t reflecting likely UG economiclimits and >0.6 g/t for Magenta |
| Mining factors orassumptions | •Assumptions made regarding possible miningmethods, minimum mining dimensions andinternal (or, if applicable, external) miningdilution. It is always necessary as part of theprocess of determining reasonable prospectsfor eventual economic extraction to considerpotential mining methods, but the assumptionsmade regarding mining methods andparameters when estimating MineralResources may not always be rigorous. Wherethis is the case, this should be reported with anexplanation of the basis of the miningassumptions made. | •Resources are reported on the assumption of mining byunderground mining methods and by open pit methods forMagenta.•The sub-celled resource model was used for evaluationand require reasonable mining dilution and recovery factorsfor lode style mining. |
| Metallurgicalfactors orassumptions | •The basis for assumptions or predictionsregarding metallurgical amenability. It isalways necessary as part of the process ofdetermining reasonable prospects for eventualeconomic extraction to consider potentialmetallurgical methods, but the assumptionsregarding metallurgical treatment processesand parameters made when reporting MineralResources may not always be rigorous. Wherethis is the case, this should be reported with anexplanation of the basis of the metallurgicalassumptions made. | •Historic reports refer to Penny West as free milling.•Spectrum completed initial metallurgical testwork on 2samples showing high (99%) recovery•Ramelius completed initial metallurgical testwork on 5fresh and 1 oxide Magenta ore composite samples.Average fresh recovery is•Further advanced testwork is in progress. |
| Environmentalfactors orassumptions | •Assumptions made regarding possible wasteand process residue disposal options. It isalways necessary as part of the process ofdetermining reasonable prospects for eventualeconomic extraction to consider the potentialenvironmental impacts of the mining andprocessing operation. While at this stage thedetermination of potential environmentalimpacts, particularly for a greenfields project,may not always be well advanced, the statusof early consideration of these potentialenvironmental impacts should be reported.Where these aspects have not beenconsidered this should be reported with anexplanation of the environmental assumptionsmade. | •Mining Approvals are yet to commence•Processing will take place at the Mt Magnet gold mine. |
| Bulk density | •Whether assumed or determined. If assumed,the basis for the assumptions. If determined,the method used, whether wet or dry, thefrequency of the measurements, the nature,size and representativeness of the samples.•The bulk density for bulk material must havebeen measured by methods that adequatelyaccount for void spaces (vugs, porosity, etc.),moisture and differences between rock andalteration zones within the deposit.•Discuss assumptions for bulk densityestimates used in the evaluation process ofthe different materials. | •Around 95 core SG measurements were available (weightin air/weight in water method) with 34 being lode zone.•Lode SG used is 2.90. While quartz vein hosted significantsulphide is present.•SG is mostly estimated for weathered rock units. |
| ClassificationAudits or | •The basis for the classification of the MineralResources into varying confidence categories.•Whether appropriate account has been takenof all relevant factors (ie relative confidence intonnage/grade estimations, reliability of inputdata, confidence in continuity of geology andmetal values, quality, quantity and distributionof the data).•Whether the result appropriately reflects theCompetent Person's view of the deposit.•The results of any audits or reviews of Mineral | •The resource has been classified as Indicated or Inferredcategories based on geological and grade continuity anddrillhole spacing and age.•The resource classification accounts for all relevant factors•The classification reflects the Competent Person's view•No audits or reviews conducted |
|---|---|---|
| reviews | Resource estimates. | |
| Discussion ofrelativeaccuracy/confidence | •Where appropriate a statement of the relativeaccuracy and confidence level in the MineralResource estimate using an approach orprocedure deemed appropriate by theCompetent Person. For example, theapplication of statistical or geostatisticalprocedures to quantify the relative accuracy ofthe resource within stated confidence limits, or,if such an approach is not deemedappropriate, a qualitative discussion of thefactors that could affect the relative accuracyand confidence of the estimate.•The statement should specify whether itrelates to global or local estimates, and, iflocal, state the relevant tonnages, whichshould be relevant to technical and economicevaluation. Documentation should includeassumptions made and the procedures used.•These statements of relative accuracy andconfidence of the estimate should becompared with production data, whereavailable. | •The accuracy and confidence in the Resource isreasonably high given the deposit style, quality and densityof drilling and sampling.•Resources are global estimates•Historic global pit production data is available |
Section 4 Estimation and Reporting of Ore Reserves
| Criteria | JORC Code explanation | Commentary |
|---|---|---|
| MineralResourceestimate forconversion toOre Reserves | •Description of the Mineral Resource estimateused as a basis for the conversion to an OreReserve.•Clear statement as to whether the MineralResources are reported additional to, orinclusive of, the Ore Reserves. | •Mineral Resource models described above were used formining evaluation, design and reporting.•Mineral Resources are reported inclusive of Ore Reserves. |
| Site visits | •Comment on any site visits undertaken by theCompetent Person and the outcome of thosevisits.•If no site visits have been undertaken indicatewhy this is the case. | •The Competent Person has made one site visit.•Visit verified understanding of deposit and availableinformation. |
| Study Status | •The type and level of study undertaken toenable Mineral Resources to be converted toOre Reserves•The Code requires that a study to at least PreFeasibility Study level has been undertaken toconvert Mineral Resources to Ore Reserves.Such studies will have been carried out and | •A pre-feasibility study has been carried out appropriate tothe deposit type, mining method and scale. The study wascarried out internally and externally using consultantswhere appropriate. |
| Cut-offparameters | will have determined a mine plan that istechnically achievable and economicallyviable, and that material Modifying Factorshave been considered. The effect, if any, ofalternative interpretations on Mineral Resourceestimation.•The basis of the cut-off grade(s) or qualityparameters applied. | •Cutoff grade for the open pit is calculated at 0.8g/t basedon Penny administration cost estimates, ore haulage andmilling cost estimates for haulage to and milling at the MtMagnet Gold Project Checkers Processing Plant.•Cutoff grade for underground is calculated at 3.0g/t basedon the proposed underground mining method and costestimates, site administration cost estimates and costestimates for ore haulage to and milling at the Mt MagnetGold Project Checkers Processing Plant. |
|---|---|---|
| Mining factors orassumptions | •The method and assumptions used asreported in the Pre-Feasibility or FeasibilityStudy to convert the Mineral Resource to anOre Reserve (i.e. either by application ofappropriate factors by optimisation or bypreliminary or detailed design).•The choice, nature and appropriateness of theselected mining method(s) and other miningparameters including associated design issuessuch as pre-strip, access, etc.•The assumptions made regarding geotechnicalparameters (eg pit slopes, stope sizes, etc),grade control and pre-production drilling.•The major assumptions made and MineralResource model used for pit and stopeoptimisation (if appropriate).•The mining dilution factors used.•The mining recovery factors used.•Any minimum mining widths used.•The manner in which Inferred MineralResources are utilised in mining studies andthe sensitivity of the outcome to their inclusion.•The infrastructure requirements of the selectedmining methods. | •Open pit mining method (Magenta Open Pit) isconventional open pit with drill and blast, excavate, loadand haul. SMU block reflects expected grade controldensity and mining equipment size.•Underground mining method consists of a conventionalsmall scall mechanised design with jumbo decline andventilation access from the Penny West pit cutback andlonghole drilling and blasting of up-hole bench stopes. Acombination of in-situ pillars and cement rock fill stopesupport are incorporated.•An external preliminary geotechnical investigation wascommissioned based on geotechnical logging of geologicaland geotechnical diamond drill cores and other geologicalinformation and gives base case pit wall design parametersand indicative underground stoping parameters.•Open Pit - mining dilution of 12% and mining recovery of95% were applied to the Magenta open pit in-situphysicals. Minimum width reflected by block parent block(2.5m) and dilution.•Inferred Resources were tested but are not used orincluded in optimisation or final pit designs for Magenta orPenny West cutback.•50% of the Inferred Resource within the Penny Westcutback pit design was included in the financial model.There is no Ore Reserve within the Penny West pitcutback.•Underground - mining dilution of 25% and mining recoveryof 95% was applied to the minimum width stope designs.No dilution or recovery factors were applied to the oredevelopment.•The underground mining study includes Inferred Resourcewhich accounts for 6% of underground mining studyounces.•The project is not sensitive to the inclusion of InferredResource.•Ore Reserves no not include Inferred Resources.Infrastructure required includes administration offices,ablutions and underground change rooms, accommodation |
| Metallurgicalfactors orassumptions | •The metallurgical process proposed and theappropriateness of that process to the style ofmineralisation•Whether the metallurgical process is welltested technology or novel in nature.•The nature, amount and representativeness ofmetallurgical test work undertaken, the natureof the metallurgical domaining applied and thecorresponding metallurgical recovery factorsapplied.•Any assumptions or allowances made fordeleterious elements.•The existence of any bulk sample or pilot scaletest work and the degree to which suchsamples are considered representative of theorebody as a whole.•For minerals that are defined by aspecification, has the ore reserve estimationbeen based on the appropriate mineralogy tomeet the specifications? | camp including water supply and treatment plant, airstrip,mining and haulage workshops, fuel tanks, generators forsurface infrastructure and mining requirements, surfaceexplosives magazine, dewatering and water transferequipment and pipelines, surface water storage dam,access road and ore haulage road upgrade.•Processing will be through conventional milling, gravitygold recovery and CIL/CIP gold leaching through theexisting Mt Magnet Gold Project Checkers ProcessingPlant (CPP).•The CPP is long established and well proven, havingsuccessfully processed a wide range of gold ores,particularly fresh underground ores similar to those fromthe Penny West Project.•Metallurgy testwork programs have includedcomprehensive head assays, diagnostic leach testing,mineralogy, grind establishment, gravity concentration,cyanide leach, reagent consumption and comminutiontesting. Testwork has reflected the CPP flowsheet.•The 13 samples tested are all within the Ore Reserve andthe probable mining inventory. They have been selectedfrom different drill holes to ensure they are spatiallyrepresentative both along strike and at varying depths, andto account for different lithologies within the fresh ore aswell as at a range of gold feed grades.•Head grade analysis and mineralogy shows elevatedsulphides associated with lead, zinc and iron howeverdiagnostic testing and subsequent leach testing has shown |
|---|---|---|
| levels.•Metallurgical testwork simulating the Mt Magnet GoldProject flowsheet with 175 µm, 125 µm and 75 µm grindhas been carried out. Gravity recoveries are high,averaging 60%. Overall recoveries ranged from 46% to99%. A recovery of 92% has been used based on averagerecoveries at the target grind size after 24 hours leaching.Additional testing is ongoing and testing conditions arebeing optimised. | ||
| •Bulk sample pilot scale testing was not undertaken. Theores will be processed through a conventional, existingplant which is well proven in processing similar ores. ThePenny West ore only makes up a small percentage of theoverall feed blend and therefore pilot scale testing is notconsidered necessary, particularly at a prefeasibility levelof study.•A final gold doré will be produced at the CPP. Therelevance of the mineralogy to the product specification is | ||
| Environmental | •The status of studies of potentialenvironmental impacts of the mining andprocessing operation. Details of waste rockcharacterisation and the consideration of | not applicable to this project.•Flora and fauna studies have been completed.•No processing of ore will occur at the Penny Project.•Waste rock and soils characterisation studies havecommenced and remain in progress. |
| potential sites, status of design options | ||
|---|---|---|
| considered and, where applicable, the status | •Mining Approvals processes yet to commence. | |
| •Heritage surveys have not been completed. | ||
| of approvals for process residue storage and | ||
| waste dumps should be reported. | ||
| Infrastructure | •The existence of appropriate infrastructure: | •The Local Government Authority (Shire) road located 3km |
| availability of land for plant development, | east of the project is suitable for ore haulage following | |
| power, water, transportation (particularly for | minor upgrades and agreements. | |
| bulk commodities), labour, accommodation; or | •Infrastructure required includes administration offices, | |
| the ease with which the infrastructure can be | ablutions and underground change rooms, accommodation | |
| provided or accessed. | camp including water supply and treatment plant, airstrip, | |
| mining and haulage workshops, fuel tanks, generators for | ||
| surface infrastructure and mining requirements, surface | ||
| explosives magazine, dewatering and water transfer | ||
| equipment and pipelines, surface water storage dam, | ||
| access road and ore haulage road upgrade. | ||
| Costs | •The derivation of, or assumptions made, | •Capital costs are based on a combination of project |
| regarding projected capital costs in the study. | specific quotes and recent capital expenditure for similar | |
| •The methodology used to estimate operating | plant and equipment and infrastructure at other Ramelius | |
| costs. | Operations. | |
| •Allowances made for the content of deleterious | •Operating costs are based on open pit contractor mining | |
| elements. | rates and underground contractor rates at current Ramelius | |
| •The derivation of assumptions made of metal | operations of similar size, actual Mt Magnet Gold Project | |
| or commodity price(s), for the principal | milling costs, current contractor ore haulage rates at similar | |
| minerals and co- products. | Ramelius sites, and administration costs incurred at current | |
| •The source of exchange rates used in the | Ramelius sites. | |
| study. | •No deleterious elements present. | |
| •Derivation of transportation charges. | •Pit optimisation was run using A$2,300/oz. | |
| •The basis for forecasting or source of | •Cost models use Australian dollars. | |
| treatment and refining charges, penalties for | •No penalties or specifications are applicable. | |
| failure to meet specification, etc. | •All underground Ore Reserves are above the calculated | |
| •The allowances made for royalties payable, | cut-off grade. | |
| both Government and private. | •State royalty of 2.5% used. | |
| Revenue Factors | •The derivation of, or assumptions made | •Gold price of A$2,300/oz for pit optimisations and |
| regarding revenue factors including head | underground design was used. | |
| grade, metal or commodity price(s) exchange | •Gold price of A$2,300/oz was used for financial model. | |
| rates, transportation and treatment charges, | •Revenue from recovery of other metals was not considered | |
| penalties, net smelter returns, etc. | in the Pre-Feasibility Study. | |
| •The derivation of assumptions made of metal | ||
| or commodity price(s), for the principal metals, | ||
| minerals and co-products. | ||
| Market | •The demand, supply and stock situation for the | •Doré is sold direct to the Perth Mint at spot price. |
| Assessment | particular commodity, consumption trends and | •Market window unlikely to change. |
| factors likely to affect supply and demand into | •Price is likely to go up, down or remain same. | |
| the future. | •Not an industrial mineral. | |
| •A customer and competitor analysis along with | ||
| the identification of likely market windows for | ||
| the product. | ||
| •Price and volume forecasts and the basis for | ||
| these forecasts. | ||
| •For industrial minerals the customer | ||
| specification, testing and acceptance | ||
| requirements prior to a supply contract. |
| Classification | •The basis for the classification of the Mineral | •The resource has been classified as Measured, Indicated |
|---|---|---|
| Resources into varying confidence categories.•Whether appropriate account has been taken | or Inferred categories based on geological and gradecontinuity and drillhole spacing and generation. | |
| of all relevant factors (ie relative confidence intonnage/grade estimations, reliability of input | •The resource classification accounts for all relevant factors•The classification reflects the Competent Person's view. | |
| data, confidence in continuity of geology and | ||
| metal values, quality, quantity and distribution | ||
| of the data).•Whether the result appropriately reflects the | ||
| Competent Person's view of the deposit. | ||
| Economic | •The inputs to the economic analysis to | •NPV of 5% used. |
| produce the net present value (NPV) in the | •Sensitivities were run on gold price, mining costs, haulageand milling cost, administration cost and mill recovery. | |
| study, the source and confidence of these | ||
| economic inputs including estimated inflation,discount rate, etc. | ||
| •NPV ranges and sensitivity to variations in the | ||
| significant assumptions and inputs. | ||
| Social | •The status of agreements with key | •Pastoral Lease stakeholders have been engaged. |
| stakeholders and matters leading to social | ||
| licence to operate. | ||
| Other | •To the extent relevant, the impact of the | •No significant issues around the mining approvals process |
| following on the project and/or on the | is identified.•No significant issues around the ore haulage road upgrade | |
| estimation and classification of the OreReserves: | and permits are identified. | |
| •Any identified material naturally occurring | •Heritage surveys have not been completed. | |
| risks. | ||
| •The status of material legal agreements and | ||
| marketing arrangements. | ||
| •The status of governmental agreements and | ||
| approvals critical to the viability of the project, | ||
| such as mineral tenement status, and | ||
| government and statutory approvals. There | ||
| must be reasonable grounds to expect that allnecessary 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 of the Ore | •Reserves are classified according to Resourceclassification. |
| Reserves into varying confidence categories.•Whether the result appropriately reflects the | •They reflect the Competent Person's view. | |
| Competent Person's view of the deposit. | •All Ore Reserves are Probable. | |
| •The proportion of Probable Ore Reserves that | ||
| have been derived from Measured Mineral | ||
| Resources (if any) | ||
| Audits or | •The results of any audits or reviews of Ore | •No external audits carried out. |
| reviews | Reserve estimates. | |
| Discussion of | •Where appropriate a statement of the relative | •Confidence is in line with gold industry standards and the |
| relative accuracy | accuracy and confidence level in the Ore | companies aim and track record on providing effective |
| / confidence | Reserve estimate using an approach or | prediction of mining projects. No statistical quantification ofconfidence limits has been applied. |
| procedure deemed appropriate by the | •Estimates are global. |
| Competent Person. For example, theapplication of statistical or geostatisticalprocedures to quantify the relative accuracy ofthe reserve within stated confidence limits, or,if such an approach is not deemedappropriate, a qualitative discussion of thefactors which could affect the relative accuracyand confidence of the estimate.•The statement should specify whether itrelates to global or local estimates, and, iflocal, state the relevant tonnages, whichshould be relevant to technical and economicevaluation. Documentation should includeassumptions made and the procedures used.•Accuracy and confidence discussions shouldextend to specific discussions of any appliedModifying Factors that may have a materialimpact on Ore Reserve viability, or for whichthere are remaining areas of uncertainty at thecurrent study stage.•It is recognised that this may not be possibleor appropriate in all circumstances. Thesestatements of relative accuracy andconfidence of the estimate should becompared with production data, whereavailable. | •The Reserve is most sensitive to gold price, mill grade andmetallurgical recovery.•Reserve confidence is reflected by the fact a Probablecategory is applied to the majority, which in turn reflects theconfidence of the Mineral Resource.•No production data is available for comparison. |
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