REG - Berkeley Energia - Increase in grade expected to boost economics <Origin Href="QuoteRef">BKY.AX</Origin> - Part 4
03/03/2016 18:04
- Part 4: For the preceding part double click ID:nRSG0809Lc
controlled excavation on a 3 to 6m mining flitch height, using 125 tonnes backhoe excavators and 100 tonne dump trucks.
Any assumptions about correlation between variables. Uranium is the only economic metals estimated in the current resource model.
Description of how the geological interpretation was used to control the resource estimates. Geological interpretation controlled the volume of the resource estimate by restricting the interpretation of the mineralisation volume and associated samples to material
with continuity above a nominal 40ppm U3O8 grade.The domains are based on geology, structure and uranium grade with defined zones of mineralisation that show continuity
along and across strike.A further division of the model into completely weathered, partially weathered and fresh rock is applied by triangulated surfaces interpreted from
the logging of the drill samples. This division is only applied for density purposes. There is no relationship or boundary effect between mineralisation and grade and
weathering intensity.
Discussion of basis for using or not using grade cutting or capping. Uranium grade distribution exhibits a strong positive skewness, so a top cut was applied to reduce local bias by extreme grades outliers - nominally approximating the
97.5 population percentile. The domains were assessed independently and a top cut grade was determined for each domain.
The process of validation, the checking process used, the comparison of model data to drill hole data, and use of reconciliation data if available. Validation of the MRE included visual inspection of the grade distribution compared to the drill data, comparison of block model statistics to the sample statistics and
generation of swath plots. These confirmed that the MRE appropriately represents the grade and tonnage distribution of the uranium mineralisation at the confidence levels
reported. A detailed review of the mineralisation domains, drilling data and resultant grade model using Datamine software was completed by the CP, which compared
favourably with the estimate completed using Surpac and Isatis software.
Moisture Whether the tonnages are estimated on a dry basis or with natural moisture, and the method of determination of the moisture content. The resource tonnage is reported on a dry bulk density basis. In-situ dry bulk density measurements were completed on dry core and on RC material using a solid-fluid
pycnometer. Results were corrected for moisture content. Sample grades are reported using dry weight.
Cut-off parameters The basis of the adopted cut-off grade(s) or quality parameters applied. The MRE has been reported using a 200ppm U3O8 cut-off grade. The Salamanca Project PFS demonstrated that a ~100ppm U3O8 cut-off is economic. Based on the current uranium
market, reporting of the MRE at a 200ppm cut-off grade is both justifiable and consistent with previous published MRE's for this style of mineralisation.
Mining factors or assumptions 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 the mining assumptions made. The PFS demonstrated that the Retortillo resource can potentially be extracted using open pit mining methods, with the recovery of uranium through the application of acid
heap leach methods.Indicative parameters used for pit optimisation purposes were:Uranium selling price: US$65/lb U3O8, Total Mining Cost: US$14.5/lb U3O8Mining recovery:
98%Mining dilution: 2%Plant Process Cost: US$12.8/lb U3O8Recovery U3O8: 85%Royalties: 1.2%
Metallurgical factors or assumptions 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. Berkeley has completed a number of metallurgical testwork programs for Retortillo as part of the scoping, PFS and definitive feasibility studies, including column leach
tests at commercial height (6m). These tests have shown that heap leaching can achieve uranium recoveries of at least 85%.
Environmen-tal factors or assumptions 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. Berkeley was granted a Favourable Declaration of Environmental Impact ('Environmental Licence') for Retortillo in October 2013 following submission of the Company's
Environmental and Social Impact Assessment ('ESIA')together with the Exploitation Plan and the Reclamation and Closure Plan.The Company's waste management and
rehabilitation assumptions were detailed in the ESIA andReclamation and Closure Plan. Spent ore from the on-off heap leach pads ('ripios') will initially be stored on the
heap leach pads and subsequently backfilled into isolated and lined (clay layer and HDPE liner) areas within the mined pits on a continuous basis once sufficient space is
available.Acid Rock Drainage (ARD) and Natural Occurring Radioactive Materials (NORM) waste will be placed onto temporary dumps designed with the required isolation
system (clay layer and HDPE liner) until the waste is backfilled into the mined pits towards the end of the mine life. At the end of the mine life, the entire volume of
ripios, ARD and NORM waste will be fully encapsulated within the mined pits, and the surface rehabilitated as per the existing profile and vegetation.
Bulk density Whether assumed or determined. 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. Bulk density values were derived from 477 core and solid fluid pycnometer measurements.The in-situ dry bulk density values are: · Completely weathered: 2.28g/cm3·
Partially weathered: 2.39g/cm3· Fresh rock: 2.62g/cm3
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. Fresh and slightly weathered rock is competent enough to ensure the method used takes into account any rock porosity. A factor derived from comparison with DD core was
used to adjust the weathered material.
Discuss assumptions for bulk density estimates used in the evaluation process of the different materials. The density measurements have been classified by weathering intensity, defined by the geological logging. Three dominant zones have been identified - completely
weathered, partially weathered and fresh rock. The average of the density data from each zone was applied in the resource model.
Classification The basis for the classification of the Mineral Resources into varying confidence categories. The reported MRE has been classified as Measured, Indicated or Inferred after consideration of the following:· Adequate geological evidence and drill hole sampling
is available to imply geological and grade continuity.· Adequate in-situ dry bulk density data is available to estimate appropriate tonnage factors.· Adequate
mining, metallurgy and processing knowledge to imply potential prospect for eventual economic extraction.
Whether appropriate account has been taken of all relevant factors (ie 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). The reported MRE has been classified with consideration of the quality and reliability of the raw data, the confidence of the geological interpretation, the number and
spacing of intercepts through the mineralised zones and knowledge of grade continuity gained from observation and geostatistical analysis.
Whether the result appropriately reflects the Competent Person's view of the deposit. The reported MRE and its classification are consistent with the CP's view of the deposit. The CP was responsible for determining the resource classification.
Audits or reviews The results of any audits or reviews of Mineral Resource estimates. An external review was undertaken by SRK on the MRE reported in July 2012. The review concluded that the estimate was considered to reflect the understanding of the
geology and grade continuity. Malcolm Titley (Geology Consultant, Maja Mining Limited) reviewed this and the previous MRE reported in April 2015 and concluded that the
estimates appropriately represented the grade and tonnage distribution of uranium mineralisation at confidence levels commensurate with the reported resource
classification.
Discussion of relative accuracy/ confidence 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 confidence level is reflected in the resource classification category chosen for the reported MRE.The definition of current Mineral Resources is appropriate for the
level of study and the geological confidence imparted by the drilling grid.The reported MRE is considered appropriate and representative of the grade and tonnage at the
200ppm U3O8 cut-off grade. The application of geostatistical methods has helped to increase the confidence of the model and quantify the relative accuracy of the resource
on a global scale. It relies on historical data being of similar standard as recent infill drilling. The relevant tonnages and grade are variable on a local scale and
have been simulated using UC and LUC for SMU dimensions of 5m by 5m by 6m.The CP considers that the drilling grid in the area that was the focus of the 2014 infill
drilling campaign is sufficient for classification of a Measured Mineral Resource.
The statement should 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. The Retortillo deposits are likely to have local variability. The global assessment is an indication of the average tonnages and grade estimate for each geological
domain.
These statements of relative accuracy and confidence of the estimate should be compared with production data, where available. No production has been carried out at Retortillo.
The Retortillo deposits are likely to have local variability. The global
assessment is an indication of the average tonnages and grade estimate for
each geological domain.
These statements of relative accuracy and confidence of the estimate should be
compared with production data, where available.
No production has been carried out at Retortillo.
Please refer to the Company's website at www.berkeleyenergia.com to view a
full version (including all figures) of this announcement
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