1
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
EXCELLENT METALLURGICAL TESTWORK RESULTS FOR T3
Testwork confirms excellent copper recoveries up to 96.5% into high grade copper concentrates (up to 47.3% Cu)
High grade ores (>4% Cu and >40ppm Ag) achieved outstanding copper recoveries up to 98.7% into very high grade concentrates (up to 60.6% Cu)
Silver recoveries up to 90.2% into high grade concentrates, and up to 97.5% into exceptional grade concentrates (up to 1304ppm Ag) from high grade ores
Cu/Ag concentrates are low in impurities and generally well below smelter penalty levels
Coarse primary grind size and low Bond Ball Mill Work Indices suggest low power requirements for grinding ore
MOD Resources Ltd (ASX: MOD) is pleased to announce it has received excellent preliminary
metallurgical testwork results for composite samples of diamond drill core from T3. T3 forms part of a joint venture between MOD Resources Ltd (70%) and AIM-listed Metal Tiger Plc (30%) in the Kalahari Copper Belt, Botswana.
The results demonstrate high concentrate grades, between 33% and 60.6% Cu, can be achieved at high recoveries, between 93.8% and 98.7% Cu, for all three copper sulphide domains (chalcopyrite, bornite and chalcocite) in disseminated and vein hosted mineralisation within the T3 resource (Table 1). Silver recoveries are also excellent (up to 97.5%) from samples of high grade chalcocite ores.
Importantly, the concentrates appear low in deleterious elements (eg. Arsenic up to 279ppm As) and are generally well below penalty levels for smelters. Additional testwork is required to optimise recoveries and concentrate grades providing an opportunity for further improvements.
The testwork results follow last week’s announcement of a maiden resource at T3 of 28.36Mt @1.24%Cu and 15.7g/t Ag containing approximately 772Mlbs copper and 14.27Moz silver (using a 0.5% Cu cut-off grade). The T3 resource includes 13.26Mt @ 1.84% Cu and 24.6g/t Ag containing 537Mlbs copper and 10.49Moz silver (using a 1.0% Cu cut-off grade). Refer Table 2.
Non-Executive Director and metallurgist, Mr Steve McGhee said, “These preliminary results are outstanding and consistent with the visual presentation of the core. They indicate it is possible to generate clean, high grade, low impurity concentrates at a low mass pull with very high recoveries.”
“These results are achieved at a relatively coarse primary grind of P80 = 150µm, that coupled with the relatively low Bond Ball Mill Work Index values of 12.3 – 14.5 kWh/t, gives us an early indication that the power requirements for grinding the ore should be relatively low,” said Mr McGhee.
The remainder of the preliminary metallurgical testwork program being carried out by Independent Metallurgical Operations in Perth remains on schedule and will be used to support the Scoping Study due for completion in December this year.
Future testwork will be based on representative composites and include optimisation tests which will aim to further improve on the already very encouraging metallurgical results.
4 October 2016 ASX: MOD
2
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
Table 1: T3 Preliminary Flotation Testwork Results
Composite
Mass Pull %
Calc Head Copper Silver
Bond WI kWh/t
Cu %
Ag ppm
% Rec Conc
Grade % % Rec
Conc Grade ppm
Chalcopyrite 4.1 1.40 7 96.5 33.0 65.9 111 14.5
Bornite 3.1 1.54 38 94.7 47.3 90.2 1101 12.3
Chalcocite 3.3 1.26 17 93.8 36.0 88.8 453 14.1
HG* Chalcopyrite 11.3 4.09 40 98.0 35.5 96.3 340 -
HG* Bornite 8.6 4.25 93 96.3 47.6 92.3 996 -
HG* Chalcocite 11.2 6.86 149 98.7 60.6 97.5 1304 -
Note*: HG = high grade Cu composite samples (>4.0% Cu and >40ppm Ag)
Testwork Parameters and Assumptions
The T3 testwork program was managed by metallurgical consultants, Independent Metallurgical Operations in Perth. The program comprised rougher and cleaner flotation tests on composite drill core samples at grind sizes varying between 75 and 212 microns.
The T3 sulphide mineralisation includes three main interpreted ore domains: Chalcopyrite dominant, Bornite dominant, and Chalcocite dominant. Testwork was carried out on composites that represented each of these domains, from core taken from a total of six diamond drill holes.
Composite samples for testwork were prepared from ¼ HQ drill core with head grades ranging from 1.26 - 1.54% Cu, and 7 - 38ppm Ag.
Additional high-grade composites were prepared from ¼ HQ drill core with head grades ranging from 4.09 - 6.86% Cu and 40 - 149ppm Ag. The high-grade composites were selected from drill core intersections with a grade >4% Cu.
The testwork completed to date includes testing the amenability of the composites to conventional copper sulphide flotation techniques and included preliminary grind sensitivity testing, rougher-cleaner batch flotation testing and Bond Ball Work Index tests.
A summary of the key flotation and grinding results are included in Table 1. These testwork results will be used as a key input into the Scoping Study being prepared on the T3 deposit.
The concentrates generated from the chalcopyrite and bornite composites were low in non-copper base metal contents. The concentrate from the chalcocite composite contained 4.6% Zn which will be considered in future testwork.
3
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
Figure 1: Copper Grade Recovery Curves.
Figure 2: Silver Grade Recovery Curves.
Figure 3: T3 Chalcopyrite flotation during testwork
4
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
T3 Drilling Update
Assay results are awaited from five infill diamond drill holes along a 400m long EW traverse across the high grade core of the T3 deposit. Results are also awaited from two diamond drill holes testing for potential depth extensions 100m NE of the resource boundary announced 26 September 2016.
A separate announcement on drilling and exploration activities and results will be released soon.
Table 2: T3 Resource Table (announced 26 September 2016)
JORC Category
Cutoff Cu% Tonnes
Grade Cu%
Grade Ag g/t
Contained Cu (tonnes)
Contained Ag (oz)
Indicated 0.5 18,071,000 1.35 16.7 244,320 9,724,550
1.0 10,103,000 1.84 24.2 186,198 7,848,794
1.5 6,773,906 2.12 29.6 143,675 6,450,935
Inferred 0.5 10,287,000 1.03 13.7 105,853 4,546,534
1.0 3,162,296 1.82 26.0 57,396 2,640,127
1.5 1,706,001 2.30 34.5 39,221 1,892,814
TOTAL 0.5 28,358,000 1.24 15.7 350,221 14,271,083
(Indicated 1.0 13,265,000 1.84 24.6 243,678 10,488,664
& Inferred) 1.5 8,479,907 2.16 30.6 182,912 8,343,592
-ENDS- For and on behalf of the MOD Board. Julian Hanna Mark Clements Managing Director Executive Chairman and Company Secretary Jane Stacey / Anna Staples AMN Corporate +61 400 205 433 - [email protected] About MOD Resources
MOD Resources Ltd (ASX: MOD) is an Australian-listed emerging copper company actively exploring in the Kalahari Copper Belt, Botswana. The Company has a joint venture with AIM-listed Metal Tiger Plc (30%), which includes the T3 copper-silver deposit where a discovery RC drill hole intersected 52m @ 2.0% Cu from shallow depth, and the recently announced T2 West prospect. On 26 September 2016, MOD announced a substantial resource at T3.
In addition to resource extension drilling at T3, MOD has a regional exploration program underway exploring for satellite deposits around T3. The Company aims to complete an open pit scoping study at T3 by the end of 2016 with a PFS scheduled to start early next year depending on the outcome.
5
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
Competent Person’s Statement The Competent Person responsible for the interpretation of the metallurgical test work results from the T3 Copper/Silver Project is Mr Daryl Evans, who is a full-time employee of Independent Metallurgical Operations and a fellow of AusIMM. Mr Evans has 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’. Mr Evans consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears.
The information in this announcement that relates to Mineral Resource estimation and classification of the T3 Copper/Silver Project is reviewed and approved by Mr A.I. Pretorius, MSc. Pri.Sci.Nat. Mr Pretorius is an independent consultant to MOD Resources Ltd and a member of the South African Council for Scientific Professionals (SACNASP Membership Number 400060/91). Mr Pretorius has 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’. Mr Pretorius consents to the inclusion in this announcement of the matters based on information in the form and context in which it appears.
The information in this announcement that relates to Geological Data and Exploration Results at the Botswana Copper/Silver Project which includes T3 is reviewed and approved by Jacques Janse van Rensburg, BSc (Hons), General Manager Exploration (Africa) for MOD Resources Ltd. He is registered as a Professional Natural Scientist with the South African Council for Natural Scientific Professions (SACNASP) No. 400101/05 and has reviewed the technical information in this report. Mr Janse van Rensburg has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and the activity, which it is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting Exploration Results, Mineral Resources and Ore Reserves. Mr Janse van Rensburg consents to the inclusion in this announcement of the matters based on information in the form and context in which it appears. Exploration Targets and Results This announcement refers to Exploration Targets as defined under Sections 18 and 19 of the 2012 JORC Code. The Exploration Targets quantity and quality referred to in this announcement are conceptual in nature. Apart from T3, there has been insufficient exploration at other Exploration Targets (for example the “T3 Dome”) mentioned in this announcement to define a Mineral Resource and it is uncertain if further exploration will result in the Exploration Targets being delineated as a Mineral Resource. This announcement includes drill hole intersections, which have been announced by MOD Resources Limited previously. Forward Looking Statements and Disclaimers This announcement includes forward-looking statements that are only predictions and are subject to risks, uncertainties and assumptions, which are outside the control of MOD Resources Limited. Examples of forward looking statements included in this announcement are: ‘Testwork confirms excellent copper recoveries up to 96.5% into high grade copper concentrates (up to 47.3% Cu).’ and ‘Cu/Ag concentrates are low in impurities and generally well below smelter penalty levels.’ and ‘low Bond Ball Mill Work Indices suggest low power requirements for grinding ore.’ and ‘They indicate it is possible to generate clean, high grade, low impurity concentrates at a low mass pull with very high recoveries’, and ‘gives us an early indication that the power requirements for grinding the ore should be relatively low’, and ‘include optimisation tests which will aim to further improve on the already very encouraging metallurgical results’.
6
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
Actual values, results, interpretations or events may be materially different to those expressed or implied in this announcement. Given these uncertainties, recipients are cautioned not to place reliance on forward-looking statements in the announcement as they speak only at the date of issue of this announcement. Subject to any continuing obligations under applicable law and ASX Listing Rules, MOD Resources Limited does not undertake any obligation to update or revise any information or any of the forward-looking statements in this announcement or any changes in events, conditions or circumstances on which any such forward-looking statement is based. This announcement has been prepared by MOD Resources Limited. The document contains background information about MOD Resources Limited current at the date of this announcement. The announcement is in summary form and does not purport to be all-inclusive or complete. Recipients should conduct their own investigations and perform their own analysis in order to satisfy themselves as to the accuracy and completeness of the information, statements and opinions contained in this announcement. The announcement is for information purposes only. Neither this announcement nor the information contained in it constitutes an offer, invitation, solicitation or recommendation in relation to the purchase or sale of shares in any jurisdiction. The announcement may not be distributed in any jurisdiction except in accordance with the legal requirements applicable in such jurisdiction. Recipients should inform themselves of the restrictions that apply to their own jurisdiction as a failure to do so may result in a violation of securities laws in such jurisdiction. This announcement does not constitute investment advice and has been prepared without taking into account the recipient’s investment objectives, financial circumstances or particular needs and the opinions and recommendations in this announcement are not intended to represent recommendations of particular investments to particular persons. Recipients should seek professional advice when deciding if an investment is appropriate. All securities transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments. To the fullest extent of the law, MOD Resources Limited, its officers, employees, agents and advisers do not make any representation or warranty, express or implied, as to the currency, accuracy, reliability or completeness of any information, statements, opinion, estimates, forecasts or other representations contained in this announcement. No responsibility for any errors or omissions from the announcement arising out of negligence or otherwise is accepted.
7
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
THE JORC CODE ASSESSMENT CRITERIA
The JORC Code (2012) describes a number of criteria, which must be addressed in the Public Report of
Mineral Resource estimates for significant projects. These criteria provide a means of assessing whether or
not parts of or the entire data inventory used in the estimate are adequate for that purpose. The resource
estimate stated in this document was based on the criteria set out in Table 1 of that Code. These criteria are
discussed as follows:
JORC Code Assessment Criteria Comments
Sampling Techniques
Drill core is logged, split by sawing and sampled by MOD personnel at site. The saw blade is cleaned after each core box, by cutting an unmineralised clay brick to reduce the chance for contamination.
Diamond drill core sampled are assayed at 1 metre lengths from half core, or less, as dictated by lithological contacts, and assayed for Cu, Ag, Mo, Pb and Zn at Set Point laboratories in Isando, Johannesburg.
10.6% Standards, blanks and duplicates are inserted into the sample stream for core on site.
The remaining half portion of drill core is retained on site at MOD’s core logging facility in Ghanzi, Botswana.
For RC drilling, sampling was carried out at 1m sampling intervals.
After every 1m interval the hole is flushed by compressed air.
The full 1m interval was collected before being weighed and the weight recorded.
All samples were riffle split (50:50) into samples weighing approximately 1.5kg
These samples were taken to the core logging facility where a unique sample number was allocated to every interval sampled
All samples were geologically logged by a suitably qualified geologist on site
Samples were submitted to Setpoint laboratories in Johannesburg
Nature and quality of sampling (e.g. cut
channels, random chips, or specific specialised
industry standard measurement tools
appropriate to the minerals under investigation,
such as downhole gamma sondes, or handheld
XRF instruments, etc.). These examples should
not be taken as limiting the broad meaning of
sampling.
Include reference to measures taken to ensure
sample representivity and the appropriate
calibration of any measurement tools or systems
used.
Aspects of the determination of mineralisation
that are Material to the Public Report. In cases
where ‘industry standard’ work has been done
this would be relatively simple (e.g. ‘reverse
circulation drilling was used to obtain 1 m
samples from which 3 kg was pulverised to
produce a 30 g charge for fire assay’). In other
cases more explanation may be required, such
as where there is coarse gold that has inherent
sampling problems. Unusual commodities or
mineralisation types (e.g. submarine nodules)
may warrant disclosure of detailed information.
Drilling Techniques
The drilling results referred to in this release were drilled by diamond core drilling rigs as well as Reverse Circulation drilling.
HQ3 and NQ diameter drill core were drilled using diamond drilling.
The RC drill holes referred to in this release were drilled by reverse circulation drilling using a 5 inch – 127mm face sampling bit diameter and 900pfm – 24 bar compressor
Drill type (e.g. core, reverse circulation, open-
hole hammer, rotary air blast, auger, Bangka,
sonic, etc.), and details (e.g. core diameter,
triple or standard tube, depth of diamond tails,
face-sampling bit or other type, whether core is
oriented and if so, by what method, etc.).
Drill Sample Recovery
Diamond drilling recorded recovery. Core recovery was good
HQ3 drilling was used for the shallow oxide drill holes to maximise core recovery in oxidized sediments.
NQ drilling was used in all other holes.
Drill core was sampled in 1m intervals or as appropriate to align with the geological contacts.
RC sample recovery was recorded by weighing every sample before splitting.
Method of recording and assessing core and
chip sample recoveries and results assessed.
Measures taken to maximise sample recovery
and ensure representative nature of the
samples.
Whether a relationship exists between sample
8
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
JORC Code Assessment Criteria Comments
recovery and grade and whether sample bias
may have occurred due to preferential loss/gain
of fine/coarse material.
Sample size was found to be consistent.
Logging
During the core logging geologists follow MOD’s standard operating procedure for logging processes. The meter interval (from & to) is recorded and the data is described in the core logs.
The geological logging process documents lithological and structural information as well as geotechnical data such as RQD, recovery and specific gravity measurements.
During the RC chip logging geologists follow MOD’s standard operating procedure for RC logging processes. The meter interval (from & to) is recorded and the data below is described within the RC drill logs:
Major rock unit (colour, grain size, texture) Weathering Alteration (style and intensity) Mineralisation (type of mineralisation, origin of
mineralisation, estimation of % sulphides/oxides) Veining (type, style, origin, intensity)
Data is originally recorded on paper (hard copies) and then transferred to Excel logging sheets
Logging is semi quantitative based on visual estimation
The geological model is supported by visual grade trends and variography (preferred axes of continuity) and is the basis for geostatistical domaining. The geological logging and assays have been used to develop the geological interpretation.
Whether core and chip samples have been
geologically and geotechnically logged to a level
of detail to support appropriate Mineral
Resource estimation, mining studies and
metallurgical studies.
Whether logging is qualitative or quantitative in
nature. Core (or costean, channel, etc.),
photography.
The total length and percentage of the relevant
intersections logged
Sub-Sampling Techniques and Sample
Preparation
Diamond core samples for the drill hole intersections were taken as either half core samples on NQ diameter or quarter core samples on HQ3 diameter.
Photos of all core samples on site were taken.
MOD has implemented an industry-standard QA/QC program. Drill core is logged, split by sawing and sampled at site. Samples are bagged, labelled, sealed and shipped to the Set Point prep- laboratories in Johannesburg, by the project manager.
Samples arriving at the lab are crushed using a jaw crusher or terminator to a particle size less than15 mm. The resulting chips are further crushed in a Rhino crusher to a fineness of 80% less than 2.0 mm. The total mass of sample crushed is screened at 2.0mm to check crushing efficiency.
If the sample requires splitting, samples are split using a Jones riffle splitter. The split to be analysed is placed into a new sample bag with a clearly marked label or sample tag. The remainder of the sample (coarse reject) is returned to the original sample bag to be returned to the client.
The split for analysis is milled to achieve a fineness of 90% less than 106 µm (or a fineness of 80 % passing 75 µm to comply with certain clients requirements). After milling, the contents of the bowl is emptied onto a brown paper sheet or clean sample dish then transferred into its sample bag.
If core, whether cut or sawn and whether
quarter, half or all core taken.
If non-core, whether riffled, tube sampled, rotary
split, etc., and whether sampled wet or dry.
For all sample types, the nature, quality and
appropriateness of the sample preparation
technique.
Quality control procedures adopted for all
sub-sampling stages to maximise representivity
of samples.
Measures taken to ensure that the sampling is
representative of the in situ material collected,
including for instance results for field
duplicate/second-half sampling.
Whether sample sizes are appropriate to the
grain size of the material being sampled.
9
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
JORC Code Assessment Criteria Comments
Quality of Assay Data and Laboratory Tests
All samples are prepped at the Set Point prep-lab in Johannesburg.
Analytical techniques have been chosen to best characterize total and non-sulphide copper and silver mineralization. The following methods are utilized;
(i) Analysis for non-sulphide Cu by: M449 - The Determination of Copper by sulphuric acid leach followed by ICP-OES finish:
PROCEDURE: One gram of pulp material is digested using
a dilute solution of sulphuric acid and sodium sulphite and
made up to a volume of 100ml. The resulting solutions are
analysed for copper, nickel, cobalt and other base metals
by the technique of ICP-OES (Inductively Coupled Plasma
– Optical Emission Spectrometry).
REPORTING: For the method (M449), a detection limit of
10ppm are reported with no
decimals and when the midpoint (5) between rounded off
values is reached the number is rounded up. Below the
midpoint, the number is rounded down.
(ii) Analysis for Cu, Ag, Mo Pb and Zn by determination of by 3 acid digest followed by ICP-OES finish:
PROCEDURE: One gram of pulp material is digested using
a dilute solution of sulphuric acid and sodium sulphite and
made up to a volume of 100ml. The resulting solutions are
analysed for copper, nickel, cobalt and other base metals
by the technique of ICP-OES (Inductively Coupled Plasma
– Optical Emission Spectrometry).
REPORTING: A detection limit of 10ppm are reported with no decimals and when the
midpoint (5) between rounded off values is reached the
number is rounded up. Below the midpoint, the number is
rounded down.
All core samples are analyzed for 3 Acid digest and acid soluble Cu.
All reported results are down hole widths.
The nature, quality and appropriateness of the
assaying and laboratory procedures used and
whether the technique is considered partial or
total.
For geophysical tools, spectrometers, handheld
XRF instruments, etc., the parameters used in
determining the analysis including instrument
make and model, reading times, calibrations
factors applied and their derivation, etc.
Nature of quality control procedures adopted
(e.g. standards, blanks, duplicates, external
laboratory checks) and whether acceptable
levels of accuracy (i.e. lack of bias) and
precision have been established.
Verification of Sampling and Assaying
Significant intersections are verified by the project manager through checks done on the half core remaining on site.
15-20% QA/QC checks are inserted in the sample stream, as lab standards, blanks and duplicates.
The accuracy and precision for all the QAQC results are considered acceptable.
An independent QAQC report was compiled, using field and lab inserted checks.
The verification of significant intersections by
either independent or alternative company
personnel.
The use of twinned holes.
Documentation of primary data, data entry
procedures, data verification, data storage
(physical and electronic) protocols.
Discuss any adjustment to assay data.
10
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
JORC Code Assessment Criteria Comments
Location of Data Points
Surveys were carried out by BBC Surveying Pty LTD, based in Gaborone, using a Spectra Precision Epoch SP80 Dual frequency GPS surveying system.
The survey was carried out using the Gauss Transverse Mercator Projection system on the Botswana datum with central meridian Lo23 degrees. This system uses 2 degree belts on the odd numbers of longitude in degrees. The values were then converted through the Trimble Geomatics Office software to the Universal Transverse Mercator Projection system (UTM) on the WGS84 system used by the client.
Down hole surveys are taken by a Champ Gyro non-magnetic electronic multishot surveying tool, SN# 13016 1F01062S inside drill strings by using the wireline system on all diamond holes drilled.
Accuracy and quality of surveys used to locate
drill holes (collar and downhole surveys),
trenches, mine workings and other locations
used in Mineral Resource estimation.
Specification of the grid system used.
Quality and adequacy of topographic control.
Data Spacing and Distribution Samples of half core for assaying were generally taken at
1m intervals or adjusted to geological contacts as deemed appropriate by on site geologists.
Drilling was done along 15 section lines spaced 100 metres apart. Drill collars along each section line was spaced 100 metres apart.
No compositing was done during the sampling process
Data spacing for reporting of Exploration
Results.
Whether the data spacing and distribution is
sufficient to establish the degree of geological
and grade continuity appropriate for the Mineral
Resource and Ore Reserve estimation
procedure(s) and classifications applied.
Whether sample compositing has been applied.
Orientation of Data in Relation to Geological
Structure
All drillholes drilled at -60 degrees inclination with azimuth perpendicular to the interpreted strike of the mineralized contact.
As copper and silver mineralization occurs in veins and disseminations approximately parallel to the mineralised contact there is no apparent sampling bias in the orientation of drill holes.
Whether the orientation of sampling achieves
unbiased sampling of possible structures and
the extent to which this is known, considering
the deposit type.
If the relationship between the drilling orientation
and the orientation of key mineralised structures
is considered to have introduced a sampling
bias, this should be assessed and reported if
material.
Sample Security
Sample bags were tagged, logged and transported to Set Point lab in Johannesburg.
Drill core for testwork was split on site with a diamond saw into half and quarter core.
Samples were forwarded to Independent Metallurgical Laboratories in Perth for test work and analysis
The measures taken to ensure sample security.
Audits and Reviews
MOD’s sampling procedure is done according to standard industry practice.
The results of any audits or reviews of sampling
techniques and data.
Mineral Tenement and Land Tenure Status
PL190/2008 is a granted Prospecting Licence held by 100% by Discovery Mines (Pty) Ltd which is wholly owned by Tshukudu Metals Botswana (Pty) Ltd which is wholly owned by Metal Capital Limited which is owned 70% MOD
Type, reference name/number, location and
ownership including agreements or material
issues with third parties such as joint ventures,
partnerships, overriding royalties, native title
11
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
JORC Code Assessment Criteria Comments
interests, historical sites, wilderness or national
park and environmental settings.
The security of the tenure held at the time of
reporting along with any known impediments to
obtaining a licence to operate in the area.
Resources Ltd and 30% Metal Tiger Plc.
In January 2016, the Minister of Minerals, Water and Energy extended the licence date of PL 190/2008 to 31 December 2016. MOD expects to apply for a further renewal or an extension at least 3 months ahead of that date. MOD is in ongoing discussion with the Department of Mines regarding extension applications for PL190/2008 and other MOD/MTR Joint Venture Project prospecting licences.
Exploration Done by Other Parties
No previous exploration in the area of drilling apart from widely spaced soil sampling conducted by Discovery Mines.
Acknowledgment and appraisal of exploration
by other parties.
Geology
The visible copper mineralization intersected in drill holes on PL190/2008 is interpreted to be a Proterozoic or early Palaeozoic age vein related sediment hosted occurrence similar to other known deposits and mines in the central Kalahari Copper Belt.
Deposit type, geological setting and style of
mineralisation.
Drill hole information This information is summarised in Table 2 and Table 3 in the T3 resource announcement released by MOD Resources on 26 September 2016
Data aggregation methods Significant copper and silver intersections are reported by MOD as received from the lab.
Weighted averages, based on sample lengths are used to calculate the intercepts.
Relationship between mineralisation widths and
intercept lengths
MOD has reported down hole widths of mineralised intersections in this and previous announcements and has included a cross section (Figure 1).
Once MOD has more drilling information to enable a meaningful interpretation of the geometry of the entire T3 deposit, MOD expects to be able to report true width intersections.
Diagrams Interpreted cross section showing Stage One resource outline
through T3 and a plan showing diamond drill hole collar positions included in release dated 26 September 2016.
Balance reporting MOD’s exploration is focused on defining vein related and disseminated Cu/Ag mineralization.
MOD considers this report provides a balanced representation of factual results and interpretation of results
Other substantive exploration data All substantive exploration data is reported.
Further work A diamond drilling program (Phase One) was completed at T3 in August 2016.
Further diamond drilling is in progress or planned to test potential for depth extensions to mineralization as well as Infill drilling to increase confidence levels of the resource classification.
Database Integrity
Data is stored in Microsoft Excel by MOD Resources Botswana. An independent database expert was appointed to validate all data, prior to it being imported into Datamine.
The author of the database and QAQC report has captured
Measures taken to ensure that data has not
been corrupted by, for example, transcription or
keying errors, between its initial collection and
its use for Mineral Resource estimation
12
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
JORC Code Assessment Criteria Comments
purposes.
Data validation procedures used.
the geological and analytical data into an Access-based database. After capturing the database was validated by the software programme Visual GeobaseTM
Datamine was used as a secondary validation during import for modeling
Site Visits
The project manager, J. Janse van Rensburg, has been working on site on the project since 2011 and has assisted in the design and implementation of exploration programs including the resource definition drilling campaign.
MOD’s joint venture partner Metal Capital Plc’s UK based Competent Person has visited site on several occasions to review geological and assay results and data collection and QA/QC procedures used at the T3 project
Comment on any site visits undertaken by the
Competent Person and the outcome of those
visits.
If no site visits have been undertaken indicate
why this is the case.
Geological Interpretation
Geological interpretation based on drill hole lithology and grade data which was completed on 15 cross-sections using Datamine software. 3D (wireframe) geological modelling was carried out by Sphynx Consulting CC and reviewed by MOD Resources.
Confidence in (or conversely, the uncertainty of)
the geological interpretation of the mineral
deposit.
Nature of the data used and of any assumptions
made.
The effect, if any, of alternative interpretations
on Mineral Resource estimation. The use of
geology in guiding and controlling Mineral
Resource estimation.
The factors affecting continuity both of grade
and geology.
Dimensions
The T3 Mineral Resource has the following extents:
X Min 635 631 - X Max 636 916
Y Min 7 641 455 - Y Max 7 642 245
Z Maximum 1115 - Z minimum 841. The deepest
mineralisation extends to a vertical depth of about 274m.
The Mineral Resource extends over a strike length of
approximately 1400 metres and a plan width of 500m.
The extent and variability of the Mineral
Resource expressed as length (along strike or
otherwise), plan width, and depth below surface
to the upper and lower limits of the Mineral
Resource.
Estimation and Modelling Techniques
Mineralisation was defined by discrete zones identified from downhole assay data.
The parent block size is 30 m (X) by 30 m (Y) by 5 m (Z) or approximately 1/3 of the drill hole spacing in the x (east) and y (north) directions. The minimum sub-block size is 3.75 m (X) by 3.75 m (Y) by 1.25 m (Z).
Grade domaining was applied by constructing hard boundaries at 0.5% Cu and 1.0% Cu respectively.
Using parameters derived from modelled variograms, Ordinary Kriging (OK) was used to estimate average block grades for Cu, Ag and Mo.
The estimation was conducted in three passes with the search size increasing for each pass.
The nature and appropriateness of the
estimation technique(s) applied and key
assumptions, including treatment of extreme
grade values, domaining, interpolation
parameters, and maximum distance of
extrapolation from data points. If a computer
assisted estimation method was chosen include
a description of computer software and
parameters used.
The availability of check estimates, previous
estimates and/or mine production records and
whether the Mineral Resource estimate takes
appropriate account of such data.
13
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
JORC Code Assessment Criteria Comments
The assumptions made regarding recovery of
by-products.
Estimation of deleterious elements or other
non-grade variables of economic significance
(e.g. sulfur for acid mine drainage
characterisation).
In the case of block model interpolation, the
block size in relation to the average sample
spacing and the search employed.
Any assumptions behind modelling of selective
mining units.
Any assumptions about correlation between
variables.
Description of how the geological interpretation
was used to control the resource estimates.
Discussion of basis for using or not using grade
cutting or capping.
The process of validation, the checking process
used, the comparison of model data to drill hole
data, and use of reconciliation data if available.
The model was validated visually and statistically.
Moisture
All tonnages are based on dry bulk density measures. The median of the bulk density measures was assigned to the orebody blocks.
Whether the tonnages are estimated on a dry
basis or with natural moisture, and the method
of determination of the moisture content.
Cut-Off Parameters
The resource model is constrained by assumptions about economic cut-off grades. The mineralisation is constrained by a 0.5 % Cu cut-off and tabulated resources are based on cut-off grade starting at 0.5 % Cu.
The basis of the adopted cut-off grade(s) or
quality parameters applied.
Mining Factors or Assumptions
The block model has been built using a parent cell size of 30 m (X) by 30 m (Y) by 5 m (Z), primarily determined by data availability.
The assumption used is that any potential future mining of the Mineral Resource is likely to be by open pit methods
The width, shallow dip and shallow depth from surface of the T3 mineralisation are the basis for the assumption above
Assumptions made regarding possible mining
methods, minimum mining dimensions and
internal (or, if applicable, external) mining
dilution.
It is always necessary as part of the process of
determining reasonable prospects for eventual
economic extraction to consider potential mining
methods, but the assumptions made regarding
mining methods and parameters when
estimating Mineral Resources may not always
be rigorous. Where this is the case, this should
be reported with an explanation of the basis of
14
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
JORC Code Assessment Criteria Comments
the mining assumptions made.
Metallurgical Factors or Assumptions
A comprehensive preliminary metallurgical test work program has been completed on composite samples of T3 drill core to determine a range of processing parameters to assist plant design, and evaluate concentrate grades and recoveries from the chalcopyrite, chalcocite and bornite ores. This work has been undertaken by Independent Metallurgical Operations (IMO) in Perth.
The results of the preliminary T3 testwork program are included with the T3 resource estimate in this release
The basis for assumptions or predictions
regarding metallurgical amenability. It is always
necessary as part of the process of determining
reasonable prospects for eventual economic
extraction to consider potential metallurgical
methods, but the assumptions regarding
metallurgical treatment processes and
parameters made when reporting Mineral
Resources may not always be rigorous. Where
this is the case, this should be reported with an
explanation of the basis of the metallurgical
assumptions made.
Environmental Factors or Assumptions
The T3 project predominantly lies within the Ghanzi District of NW Botswana. The area is generally covered with savanna grasslands. Areas within the permit area and environs have been identified that could be used to store waste rock but have not been advanced sufficiently to consider any environmental impacts.
Assumptions made regarding possible waste
and process residue disposal options. It is
always necessary as part of the process of
determining reasonable prospects for eventual
economic extraction to consider the potential
environmental impacts of the mining and
processing operation. While at this stage the
determination of potential environmental
impacts, particularly for a greenfields project,
may not always be well advanced, the status of
early consideration of these potential
environmental impacts should be reported.
Where these aspects have not been considered
this should be reported with an explanation of
the environmental assumptions made.
Bulk Density
The dry bulk density values used in the resource model were assigned using the median values of the available data. (Approximately 369 density determinations on drill core were used.
A median bulk density of 2.75 t/m3 was used.
Whether assumed or determined. If assumed,
the basis for the assumptions. If determined,
the method used, whether wet or dry, the
frequency of the measurements, the nature, size
and representativeness of the samples.
The bulk density for bulk material must have
been measured by methods that adequately
account for void spaces (vugs, porosity, etc.),
moisture and differences between rock and
alteration zones within the deposit.
Discuss assumptions for bulk density estimates
used in the evaluation process of the different
materials.
Classification
Resources were classified in accordance with the Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2012 Edition).
The classification of Mineral Resources was completed
The basis for the classification of the Mineral
Resources into varying confidence categories.
Whether appropriate account has been taken of
15
First Floor, 1304 Hay St, West Perth WA 6005 T +61 (8) 9322 8233 www.modresources.com.au
ASX Announcement – Excellent Metallurgical Testwork Results for T3
JORC Code Assessment Criteria Comments
all relevant factors, i.e. relative confidence in
tonnage/grade estimations, reliability of input
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.
based on the geological complexity, estimation performance, number of drill samples, drill hole spacing and sample distribution. The Competent Person is satisfied that the result appropriately reflects his view of the deposit.
Continuous zones meeting the following criteria were used to define the resource class:
Indicated Resource
Drill spacing up to approximately 100 m by 100 m
Estimation performance: Weighted average between 1.0
and 1.4
Inferred Resource
Drill spacing wider than 100 m by 100 m
Estimation performance: Weighted average above 1.4
blocks estimated in the third pass
Limited number of drill holes
Audits or Reviews
The announcement on 26 September 2016 disclosed a maiden Resource Estimate.
No external independent reviews of the Mineral Resource estimate have been conducted to date.
An internal review was undertaken by MOD Resources and the resource consultant on 19 September 2016.
The results of any audits or reviews of Mineral
Resource estimates.
Discussion of Relative Accuracy/Confidence
The relative accuracy is reflected in the resource classification discussed above that is in line with industry acceptable standards.
This is a global resource estimate with no production data.
Where appropriate a statement of the relative
accuracy and confidence level in the Mineral
Resource estimate using an approach or
procedure deemed appropriate by the
Competent Person. For example, the
application of statistical or geostatistical
procedures to quantify the relative accuracy of
the resource within stated confidence limits, or,
if such an approach is not deemed appropriate,
a qualitative discussion of the factors that could
affect the relative accuracy and confidence of
the estimate.
The statement should specify whether it relates
to global or local estimates, and, if local, state
the relevant tonnages, which should be relevant
to technical and economic evaluation.
Documentation should include assumptions
made and the procedures used.
These statements of relative accuracy and
confidence of the estimate should be compared
with production data, where available.