TIDMAMC
RNS Number : 8027M
Amur Minerals Corporation
02 May 2018
2 May 2018
AMUR MINERALS CORPORATION
(AIM: AMC)
Projected C1 Nickel Costs Below Nickel Industry Average
Amur Minerals Corporation ("AMC" or the "Company"), a
nickel-copper sulphide mineral exploration and resource development
company located in the Russian Far East, is pleased to update
shareholders that its in-house C1 cost estimates (Net Direct Cash
Cost) per pound of nickel at its planned Kun-Manie nickel copper
sulphide project would place it among the existing 10 lowest cost
nickel industry producers.
Based on the 16 April 2018 RNS, which reported Kun-Manie mining
potential of 73 million ore tonnes (12 years and 2 months of
production at 6.0 million ore tonnes per annum), the Life of Mine
("LOM") C1 cost per pound nickel is projected to range from USD
2.61 (USD 5,750 per tonne) (Owner Operated Low Grade Matte - "OO
LGM") to USD 2.77 (USD 6,100 per tonne) (contract toll smelting -
"TS").
Highlights:
-- C1 projected per pound nickel costs range from the OO LGM
cost of USD 2.61 (USD 5,750 per tonne) to the TS projected C1 cost
of USD 2.77 (USD 6,100 per tonne) at the Company's planned
Kun-Manie operation.
-- The projected C1 costs indicate Kun-Manie could rank among
the 10 lowest cost industry wide nickel producers as per CRU's most
recent estimate (April 2017) of business costs at existing
operations.
-- Based on the Brook Hunt C1 definition of costs (including all
operating costs, all truck and rail freight (FOB Vladivostok)
costs, smelting and refining fees, royalties and net profit tax),
the C1 projected costs are lower than all CRU April 2017 reported
hydrometallurgical, FeNi and NPI nickel operations. With regard to
NiS operators, Kun-Manie ranks from 4(th) to 7(th) within the group
of 16 reported nickel sulphide producers.
-- Mine site C1 costs (including truck freight of the
concentrate to the nearest rail station) totals USD 1.76 per pound
nickel (USD 3,900 per tonne). This component of the C1 cost is the
same for both TS and OO LGM production scenarios. Additional C1
costs are USD 1.01 per nickel pound (USD 2,220 per tonne) for the
TS option and USD 0.86 per nickel pound (USD 1,900 per tonne) for
the OO LGM production opportunity. The additional cost components
include smelting and operating considerations specific to each of
the TS and OO LGM options. This includes smelter fees and losses,
rail freight (FOB Vladivostok), refining, royalty and net profit
tax costs bringing the total C1 cost for the TS option to USD 2.77
per nickel pound (USD 6,100) and USD 2.61 per pound (USD 5,750 per
tonne) for the OO LGM opportunity.
-- Cost projections are based on the Company's February 2017
Mineral Resource Estimate ("MRE") Measured and Indicated inventory
from which RPM Global, the independent mining consultancy,
generated open pit and underground mine designs that identify 73
million ore production tonnes. This provides for a mine life of 12
years and 2 months.
-- These C1 costs do not take into account the increase in the
MRE as a result of the inclusion of the 2017 drill results at the
Ikenskoe / Sobolevsky ("IKEN") and Kubuk ("KUB") deposits as
announced on 20 March 2018. Presently, open pit designs (to be
followed by the potential to extract underground ores at a higher
profit) within and between the neighbouring IKEN and KUB deposits
indicates substantial potential to extend the mine life to a
minimum of 15 years. The addition of these ores will change the C1
costs reported herein.
Robin Young, CEO of Amur Minerals, commented:
"We are pleased to provide projections of the C1 fully loaded
direct operating costs for our two primary production options which
include toll smelting or our building and operating of a Low Grade
Matte facility to process our concentrate. Comparison of these
newly defined costs indicates that Kun-Manie could be a low cost
competitor within the nickel industry ranking in the lowest 10
producers by cost and, potentially , even as low as fourth. Ranging
from $5,750 to $6,100 per nickel tonne, we are well below the CRU
projected average production cost of $10,000 per tonne (as at April
2017).
"These newly defined C1 cost projections include all projected
operating costs and operational considerations from the mine face
to the sale of a final product. These costs also take into account
mine dilution, metallurgical recoveries at the mine and smelters,
truck and rail freight and more. We have also included the Russian
Far East reduced tax and royalty incentives which further reduce
our total production cost per nickel unit, whether a pound or a
tonne.
"In addition, looking at how we rank among the greenfield and
brownfield projects, we note that there are about 10 projects that
contain more than our 1.2 million tonne nickel resource. Of these,
only two have higher grades of ore than our average of 0.75%
nickel. Interestingly, the remaining six have average grades below
what we use as a cutoff grade which is 0.4% nickel. As such, we
feel well positioned in the new emerging nickel demanding
Electronic Vehicle market."
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
Enquiries:
Company Nomad and Broker Public Relations
Amur Minerals S.P. Angel Corporate Yellow Jersey
Corp. Finance LLP PR
Robin Young Ewan Leggat Charles Goodwin
CEO Soltan Tagiev Harriet Jackson
Dominic Barretto
+44(0)7544
+7(4212)755615 +44(0)203 470 0470 275 882
For additional information, visit the Company's website,
www.amurminerals.com.
Click on, or paste the following link into your web browser, to
view the associated important PDF document and audio file.
http://amurminerals.com/content/wp-content/uploads/C1-2018-APR-30.pdf
http://amurminerals.com/content/wp-content/uploads/C1-2018-APR-30.mp3
Notes to Editors
The information contained in this announcement has been reviewed
and approved by the CEO of Amur, Mr. Robin Young. Mr. Young is a
Geological Engineer (cum laude), a Professional Geologist licensed
by the Utah Division of Occupational and Professional Licensing,
and is a Qualified Professional Geologist, as defined by the
Toronto and Vancouver Stock Exchanges. An employee of Amur for 13
years, previously Mr. Young was employed as an exploration and mine
geologist, mining engineer, construction manager of a mine startup
as well as independent consultant with Fluor Engineers, Fluor
Australia and Western Services Engineering, Inc. during which time
his responsibilities included the independent compilation of
resources and reserves in accordance with JORC standards. In
addition, he has been the lead engineer and project manager in the
compilation of numerous studies and projects requiring the
compilation of independent Bankable Studies utilised to finance
small to large scale projects located worldwide. Mr. Young is
responsible for the content of this announcement which includes
information sourced from RPM Global, SGS Minerals, Gipronickel
Institute and CRU International Limited.
Overview and Considerations Regarding C1 Determination
C1 (Direct Cash Costs) reported costs are a metric used by the
mining industry as a reference point to denote the basic direct
cash costs of running a planned or operational mine. This metric
allows comparisons of planned projects and producing operations
generating the same commodities. The AMC compiled C1 costs reported
herein are based on the definition derived from Brook Hunt where C1
costs are direct costs and include the following:
-- Mining, ore haulage and milling costs
-- Mine-site administration and general expenses
-- Concentrate freight, smelting and smelter general and administrative costs
-- Matte freight, refining and refinery general and administrative costs
-- Marketing costs (freight and selling)
-- Royalties and net profits tax
Production Basis for Calculation
AMC's estimated C1 costs are based on the 16 April 2018 reported
Mining Potential including mine production from four open pits and
one underground Long Hole Open Stoping ("LHOS") production areas.
The projected Earnings Before Interest, Tax, Depreciation and
Amortisation ("EBITDA") is USD 2.7 billion.
The production summary by deposit (open pit) and mining method
used in the compilation of the C1 cost projections is set out in
the table below. The current Life of Mine ("LOM") production of 73
million ore tonnes is projected to be in the order of 12 years and
2 months (based on the February 2017 MRE).
Mining Production Profile
16 April 2018 (based on the February 2017 MRE)
Deposit Ore Waste Total Stripping Ni Cu Co Pt Pd
Mt Mt Tonnes Ratio (%) (%) (%) (g/t) (g/t)
Mt t:t
---------- ----- ------ -------- ---------- ----- ----- ----- ------- -------
March 2018 MRE does not impact MKF or VOD
--------------------------------------------------------------------------------------
MKF OP 13.9 47 61 3.4 0.72 0.20 0.01 0.14 0.13
---------- ----- ------ -------- ---------- ----- ----- ----- ------- -------
MKF UG
LHOS 32.4 6 38 NA 0.71 0.19 0.01 0.13 0.14
---------- ----- ------ -------- ---------- ----- ----- ----- ------- -------
VOD OP 4.9 4 9 0.8 0.79 0.20 0.02 0.17 0.17
---------- ----- ------ -------- ---------- ----- ----- ----- ------- -------
March 2018 MRE update will impact IKEN and
KUB - Open Pit Analysis Underway
--------------------------------------------------------------------------------------
IKEN OP 15.2 77 93 5.1 0.60 0.15 0.01 0.23 0.19
---------- ----- ------ -------- ---------- ----- ----- ----- ------- -------
KUB OP 7.0 38 46 5.2 0.78 0.20 0.02 0.16 0.17
---------- ----- ------ -------- ---------- ----- ----- ----- ------- -------
Total
OP Plus
UG 73.4 172 245 4.0 0.70 0.19 0.01 0.16 0.12
---------- ----- ------ -------- ---------- ----- ----- ----- ------- -------
Note: RPM Global ("RPM") are presently updating the open pit
production potential for the IKEN and KUB deposits which could
substantially alter the results presented above and is anticipated
to result in a change in the current projected Life of Mine C1
costs with the addition of an additional three years of
production.
Process Plant Recoveries and Concentrate Production
Considerations
Nickel metallurgical recoveries at VOD, IKEN and KUB were based
on SGS Minerals ("SGS") grade recovery results (30 August 2016)
whilst the MKF nickel recovery was based on results from a half
tonne bulk sample analysed by Gipronickel Institute ("GIPRO") (11
January 2017). The global metallurgical recovery for all production
of nickel to concentrate averages 79.0%.
Global Metallurgical Recovery by
Recovery at the Plant Deposit
-------------------------- -------------
Nickel 79.0% MKF - 80.6%
(GIPRO)
---------------- -------- -------------
Copper 83% VOD - 74.6%
(SGS)
---------------- -------- -------------
Cobalt 61% IKEN - 78.3%
(SGS)
---------------- -------- -------------
Platinum 60% KUB - 68.6%
(SGS)
---------------- -------- -------------
Palladium 82%
---------------- -------- -------------
Concentrate Production
and Content
Tonnes Dry 4.4
Concentrate Mt
-------------------- ------ ------
Contained Moisture 7%
-------------------- ------ ------
Concentrate 4.7
Wet Tonnes Mt
-------------------- ------ ------
Ni 9.3% 404
kt
-------------------- ------ ------
Cu 2.6% 115
kt
-------------------- ------ ------
Co 0.14% 4,500
t
-------------------- ------ ------
Pt 1.6 7.0
g/t t
-------------------- ------ ------
Pd 2.1 7.2
g/t t
-------------------- ------ ------
Mine Site Operating Costs for C1 Calculation
On 17 July 2017, the Company reported a qualified C1 cost (USD
1.78 per pound - USD 3,920 per tonne) for the "Mine Site" portion
of the C1 cost. This "Mine Site" component includes all costs
through concentrate delivery to the Ulak station located on the
Baikal Amur ("BAM") rail line. These costs remain unchanged with
regard to the downstream concentrate treatment options and are
referred to as Mine Site costs. The unit costs used to calculate
the Mine Site C1 total are summarised below.
Cost Centre Units Unit Cost
---------------------------- ---------- ----------
Open Pit Mining $/t ore 6.53
(Waste Included) OC
LHOS Mining $/ t 7.44
ore UG
---------------------------- ---------- ----------
Ore Transport to
Process Plant $/t ore 1.58
---------------------------- ---------- ----------
Processing Cost $/t ore 11.50
---------------------------- ---------- ----------
Tailings $/t ore 0.16
---------------------------- ---------- ----------
Concentrate Transport
to Ulak $/t ore 1.50
---------------------------- ---------- ----------
General and Administrative $/t ore 1.98
---------------------------- ---------- ----------
Open Cut Total
Cost $/t ore 23.25
---------------------------- ---------- ----------
Underground Total
Cost $/t ore 24.16
---------------------------- ---------- ----------
Using the reported 16 April 2018 mining potential, the Mine Site
C1 cost component for delivery of the concentrate to Ulak is
estimated to be USD 1.76 per pound (USD 3,880 per tonne). This is a
USD 0.02 per pound nickel (USD 44 per tonne) reduction from that
reported on 17 July 2017.
Downstream C1 Costs - Saleable Product Generation
By definition, fully loaded C1 costs include the treatment cost
of the concentrate resulting in a salable intermediate or final
product, royalties, freight, customs and net profits tax. The
Company calculated these Downstream C1 costs for each of two
options as follows:
-- Toll Smelting ("TS") -based on available smelter off take agreements
-- Construction of an owner operated Low Grade Matte ("OO LGM")
facility at the Ulak rail station.
Using available TS off-take schedules and Company derived first
principle calculations for the OO LGM operation, the all-in
Downstream C1 cost per pound of nickel were determined. The
Downstream component included all concentrate treatment costs and
losses, freight (FOB Vladivostok), royalties and net profit tax,
the Downstream C1 cost ranges from USD 1.01 per pound (USD 2,230
per tonne) (OO LGM scenario) to USD 1.12 per pound (USD 2,470 per
tonne) (TS scenario).
Total All-In C1 Cost Per Pound Nickel
The combined Mine Site and Downstream C1 costs per pound nickel
are provided below by cost sector.
C1 Kun-Manie Costs Per Pound Nickel
Life of Mine Projected
Cost (USD) TS OO LGM
------------------------ ------- -------
Mining $0.74 $0.74
------------------------ ------- -------
Processing + Tailings $0.84 $0.84
------------------------ ------- -------
Freight to Rail
Station $0.01 $0.01
------------------------ ------- -------
G&A $0.17 $0.17
------------------------ ------- -------
Royalties $0.23 $0.27
------------------------ ------- -------
Smelter Opex $0.71 $0.44
------------------------ ------- -------
Net Profit Tax $0.07 $0.15
------------------------ ------- -------
Total C1 Cost Per
Pound Ni $2.77 $2.61
------------------------ ------- -------
Total C1 Cost Per
Tonne Ni $6,100 $5,750
------------------------ ------- -------
The following link provides charts depicting the LOM and annual
distribution of C1 costs.
http://amurminerals.com/content/wp-content/uploads/C1-2018-APR-30.pdf
Comparison to Operating Mines
On a cost basis and using the April 2017 CRU Business Cost chart
of operating mines, the projected C1 cost range of USD 2.61 to USD
2.77 per nickel pound (from USD 5,750 to USD 6,100 per tonne of
nickel) indicates that Kun-Manie could be a highly competitive
operation within the nickel industry. See the following link:
http://amurminerals.com/content/wp-content/uploads/C1-2018-APR-30.pdf
Cautionary Statement Regarding Use of a C1 Cost
The Company notes selection of an optimal operational design
should not be based solely on C1 cost projections as these are
direct costs only and do not reflect the profitability potential of
a mine and time value of money. To determine better indicative
options, an enhanced Brook Hunt metric recommends the calculation
of the M1 value (revenue less C1), an indicator of profit potential
similar to but not the same as an Earnings Before Interest, Tax,
Depreciation and Amortisation ("EBITDA") reported value. The EBITDA
excludes royalties and taxes.
For Kun-Manie, each of the two options is designed to generate a
saleable product and are characterised by substantially differing
payable schedules for the recovered metal. Each option thereby
provides a highly unique revenue stream. The following table
presents a comparison of typical percent payable metal factors for
the TS and OO LGM option.
Typical Industry Payable Schedule for Revenue Determination
Parameters Nickel Copper Cobalt Platinum Palladium
--------------------------------- --------- ----------- ------------ ----------- -----------
Metal In Concentrate 890 253 m lbs 9.9 m lbs 225 k ozs 232 k ozs
m lbs 115,000 t 4,500 t 7.0 t 7.2 t
404,000
t
--------------------------------- --------- ----------- ------------ ----------- -----------
Production Option Payable Payable Payable Payable Payable
Nickel Copper Cobalt Platinum Palladium
--------------------------------- --------- ----------- ------------ ----------- -----------
TS 70% 0 to 50% 0% 0% 0%
--------------------------------- --------- ----------- ------------ ----------- -----------
70 -
LGM 80% 70 - 80% 70 - 80% 70 - 80% 70 - 80%
--------------------------------- --------- ----------- ------------ ----------- -----------
Revenue (27 April 2018) Pricing 6.30 3.10 / lb 40.00 / lb 910 / oz 925 / oz
USD / lb 6,832 / t 88,200 / t 29.25 / g 29.75 / g
13,885
/ t
--------------------------------- --------- ----------- ------------ ----------- -----------
Adjusted Payable Based Revenue Potential- Average
From Industry Payable Schedules
-------------------------------------------------------------------------------------------------
$3,926
TS M $196 M $0 M $0 M $0 M
--------------------------------- --------- ----------- ------------ ----------- -----------
$4,207
LGM M $589 M $298 M $153 M $161 M
--------------------------------- --------- ----------- ------------ ----------- -----------
The above table is based on average industry payable schedules
and is not specific to the Kun-Manie project as the Company has not
entered into any contract regarding the delivery of a concentrate
or LGM at this time. These are illustrative only and are intended
to depict that the use of the C1 metric for decision making by the
Company or an investor must include substantial and additional
considerations.
March 2018 Mineral Resource Estimate
0.4% Nickel Cutoff Grade
Resource Ore Ni Cu Co Pt Pd Eq Contained Metal (t)
Classification Mt % % % g/t g/t Ni
(%)
---------------- ------ ----- ----- ------ ----- ----- ----- ---------------------------------------------------------
Ni Cu Co Pt Pd Eq
(1000's) (1000's) (1000's) (t) (t) Ni
(1000's)
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
MKF - Updated February 2017 - No New Drilling
------------------------------------------------------------------------------------------------------------------------------
Measured
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Indicated 57.5 0.77 0.22 0.015 0.15 0.16 1.06 445 124 8.9 8.8 9.3 606.5
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
M+I 57.5 0.77 0.22 0.015 0.15 0.16 1.06 445 124 8.9 8.8 9.3 606.5
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Inferred 3.4 0.80 0.22 0.017 0.16 0.15 1.06 27 7 0.6 0.5 0.5 36.1
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
MKF TOTAL 60.9 0.78 0.22 0.015 0.15 0.16 1.06 472 131 9.5 9.3 9.8 643.0
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
IKEN - Updated March 2018 - Open Pit and Underground
Potential Review Necessary
------------------------------------------------------------------------------------------------------------------------------
Measured 10.6 0.71 0.18 0.011 0.22 0.26 0.98 75 19 1.1 2.3 2.8 103.2
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Indicated 13.6 0.66 0.17 0.012 0.18 0.20 0.91 89 24 1.7 2.4 2.8 123.7
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
M+I 24.2 0.68 0.18 0.012 0.19 0.23 0.94 164 43 2.8 4.7 5.6 226.9
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Inferred 27.8 0.80 0.23 0.017 0.19 0.19 1.10 222 63 4.6 5.2 5.3 306.5
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
IKEN TOTAL 51.9 0.75 0.20 0.014 0.19 0.21 1.03 386 106 7.5 9.9 10.8 534.0
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
KUB - Updated March 2018 - Open Pit and Underground
Potential Review Necessary
------------------------------------------------------------------------------------------------------------------------------
Measured -
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Indicated 32.9 0.69 0.19 0.014 0.13 0.12 0.93 226 63 4.7 4.3 3.9 306.0
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
M+I 32.9 0.69 0.19 0.014 0.13 0.12 0.93 226 63 4.7 4.3 3.9 306.0
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Inferred 4.7 0.7 0.19 0.014 0.12 0.12 0.94 33 9 0.7 0.6 0.6 44.5
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
KUB TOTAL 37.6 0.69 0.19 0.014 0.13 0.12 0.93 259 72 5.3 4.9 4.5 349.9
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
VOD - Updated February 2017 - No Underground Potential
- No New Drilling
------------------------------------------------------------------------------------------------------------------------------
Measured 0.6 0.74 0.22 0.012 0.29 0.32 1.24 5 1 0.1 0.2 0.2 7.6
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Indicated 3.2 0.85 0.21 0.017 0.16 0.16 1.13 27 7 0.5 0.5 0.5 36.0
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
M+I 3.8 0.85 0.21 0.016 0.20 0.19 1.15 32 8 0.6 0.7 0.7 43.9
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Inferred 1.0 0.81 0.22 0.016 0.17 0.16 1.06 8 2 0.2 0.2 0.2 11.0
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
VOD TOTAL 4.8 0.83 0.21 0.016 0.18 0.18 1.13 40 10 0.8 0.9 0.9 54.6
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
TOTAL
------------------------------------------------------------------------------------------------------------------------------
Measured 11.2 0.71 0.18 0.011 0.23 0.26 0.99 80 20 1.3 2.5 3.0 110.8
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Indicated 107.0 0.74 0.20 0.015 0.15 0.15 1.00 787 217 16.2 16.0 16.6 1,075.1
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
M+I 118.2 0.73 0.20 0.015 0.16 0.17 1.00 867 237 17.5 18.5 19.6 1,185.9
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Inferred 37.0 0.79 0.22 0.017 0.17 0.18 1.08 290 81 6.0 6.4 6.6 398.2
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
TOTAL 155.1 0.75 0.21 0.015 0.16 0.17 1.02 1,157 319 23.5 24.9 26.0 1,581.6
---------------- ------ ----- ----- ------ ----- ----- ----- --------- --------- --------- ----- ----- ----------
Numbers may not be concise due to rounding.
Glossary
DEFINITIONS OF EXPLORATION RESULTS, RESOURCES & RESERVES
EXTRACTED FROM THE JORC CODE: (December 2012) (www.jorc.org)
A 'Mineral Resource' is a concentration or occurrence of
material of intrinsic economic interest in or on the Earth's crust
in such form, quality and quantity that there are reasonable
prospects for eventual economic extraction. The location, quantity,
grade, geological characteristics and continuity of a Mineral
Resource are known, estimated or interpreted from specific
geological evidence and knowledge. Mineral Resources are
sub-divided, in order of increasing geological confidence, into
Inferred, Indicated and Measured categories.
An 'Inferred Mineral Resource' is that part of a Mineral
Resource for which tonnage, grade and mineral content can be
estimated with a low level of confidence. It is inferred from
geological evidence and assumed but not verified geological and/or
grade continuity. It is based on information gathered through
appropriate techniques from locations such as outcrops, trenches,
pits, workings and drill holes which may be limited or of uncertain
quality and reliability.
An 'Indicated Mineral Resource' is that part of a Mineral
Resource for which tonnage, densities, shape, physical
characteristics, grade and mineral content can be estimated with a
reasonable level of confidence. It is based on exploration,
sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits,
workings and drill holes. The locations are too widely or
inappropriately spaced to confirm geological and/or grade
continuity but are spaced closely enough for continuity to be
assumed.
A 'Measured Mineral Resource' is that part of a Mineral Resource
for which tonnage, densities, shape, physical characteristics,
grade and mineral content can be estimated with a high level of
confidence. It is based on detailed and reliable exploration,
sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits,
workings and drill holes. The locations are spaced closely enough
to confirm geological and/or grade continuity.
An 'Ore Reserve' is the economically mineable part of a Measured
and/or Indicated Mineral Resource. It includes diluting materials
and allowances for losses, which may occur when the material is
mined. Appropriate assessments and studies have been carried out,
and include consideration of and modification by realistically
assumed mining, metallurgical, economic, marketing, legal,
environmental, social and governmental factors. These assessments
demonstrate at the time of reporting that extraction could
reasonably be justified. Ore Reserves are sub-divided in order of
increasing confidence into Probable Ore Reserves and Proved Ore
Reserves.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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