REG - Metminco Limited - Maiden Ore Reserve for Miraflores - Update <Origin Href="QuoteRef">MNC.AX</Origin> - Part 6
27/11/2017 07:05
- Part 6: For the preceding part double click ID:nRSa5605Xe
August 2017 and is being used as the basis for the ongoing environmental and social work. The Environmental Impact Assessment
Study is expected to be submitted in Q1 of 2018. Plan de Trabajos y Obras or (PTO); The PTO licence is issued by the Ministry Of
Mines and Energy and must comply with the Terms of Reference set out by the ministry for non-seabed minerals and materials. All
projects must obtain an EIA and PTO prior to commencing development of the project. Approvals are expected to take between 4 and
6 months from submission depending on the requirement to provide further data requested by the authorities.
Classification The basis for the classification of the Ore Reserves into varying confidence categories. The Measured and Indicated Mineral Resources were classified as Proved and Probable Ore Reserves respectively. The Ore Reserve AUSENCO
Whether the result appropriately reflects the Competent Person's view of the deposit. estimate of the Miraflores Project is reported as at the effective day of 18 October 2017. The Ore Reserves estimate is
The proportion of Probable Ore Reserves that have been derived from Measured Mineral inclusive of Mineral Resources. The reference point of the Ore Reserve is the run of mine (ROM) stock pile area where the
Resources (if any). material will be fed into the process plant. The reserve estimate is supported by the Miraflores Feasibility Study complying
with the JORC Code standards. The Ore Reserve estimate provided appropriately reflects the Competent Person's view of the
opportunity for Metminco to develop the Miraflores Gold Project based on the modifying factors derived from the Feasibility
Study work and the updated Mineral Resource model. The key modifying factors of the Ore Reserve estimate are described as
follows:* Reserves are based on a gold price of US$1,200/oz and silver price of US$18/oz;
* An underground cut-off grade (CoG) of 1.53 g/t-Au was applied to underground resources constrained by a final underground
design;
* Reserves are defined within an underground mine plan generated from diluted Mineral Resources;
* Underground reserves assume total dilution of 31%;
* Mining and processing production schedules were developed for assessing the technical viability of the project;
* Revenue estimates were developed as per industry standards;
* Operating and capital cost estimates were executed as per industry standards; and
* The construction and production schedules formed the basis for a financial model delivering a positive outcome for the
economic evaluation.
As can be appreciated from the information in Table 1, the Ore Reserve gold cut-off grade utilised a gold price, site operating
costs and gold recovery values which have small differences from the figures used in the financial model. This is due to the Ore
Reserve cut-off grade being estimated for the stope optimisation analysis prior to development of the financial model, being the
first activity executed during the Miraflores Feasibility Study. The cut-off grade delineated the material to be included in the
Ore Reserve estimate but subsequent activities such as the metallurgical test work, mine and processing production schedule and
operating cost estimate provided the final values for the modifying factors which have been included into the financial model.
The Competent Person assessed these small discrepancies and concluded that no material impact on the final technical and
economic outcome of the Miraflores Feasibility Study is evident. Ore ReservesProved: 1.70Mt @ 2.75g/t Au and 2.20g/t
AgProbable: 2.62Mt @ 3.64g/t Au and 3.13g/t AgProved and Probable: 4.32Mt @ 3.29g/t Au and 2.77g/t Ag
Audit or reviews The results of any audits or reviews of Ore Reserve estimates. No formal audits have been conducted on the Mineral Reserve estimate Metminco
Discussions of relative accuracy/confidence Where appropriate a statement of the relative accuracy and confidence level in the Ore Reserve 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 reserve within stated confidence limits, or, if such an approach is not deemed appropriate, a qualitative discussion of the factors which could affect the relative accuracy and confidence of the estimate. The Competent Person has recommended that further work be conducted prior to commencement of construction of the Miraflores Metminco CPs
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. Project on the following topics:* Geotechnical stability analysis for the underground mine, especially in the areas containing
Accuracy and confidence discussions should extend to specific discussions of any applied non-backfilled stopes;
Modifying Factors that may have a material impact on Ore Reserve viability, or for which * Stope Backfilling sequence;
there are remaining areas of uncertainty at the current study stage. It is recognised that this may not be possible or appropriate in all circumstances. These * Develop a detailed mining construction schedule;
statements of relative accuracy and confidence of the estimate should be compared with production data, where available. * Understand the predicted underground water levels; and
* Update the environmental and social costs as per the granted permit - still to be granted.
This further work may result in some changes to the modifying factors representing a high risk for the achievement of the
technical and economic outcome of the Miraflores Gold Project delivered by the feasibility study.
* Reserves are based on a gold price of US$1,200/oz and silver price of
US$18/oz;
* An underground cut-off grade (CoG) of 1.53 g/t-Au was applied to underground
resources constrained by a final underground design;
* Reserves are defined within an underground mine plan generated from diluted
Mineral Resources;
* Underground reserves assume total dilution of 31%;
* Mining and processing production schedules were developed for assessing the
technical viability of the project;
* Revenue estimates were developed as per industry standards;
* Operating and capital cost estimates were executed as per industry
standards; and
* The construction and production schedules formed the basis for a financial
model delivering a positive outcome for the economic evaluation.
As can be appreciated from the information in Table 1, the Ore Reserve gold
cut-off grade utilised a gold price, site operating costs and gold recovery
values which have small differences from the figures used in the financial
model. This is due to the Ore Reserve cut-off grade being estimated for the
stope optimisation analysis prior to development of the financial model, being
the first activity executed during the Miraflores Feasibility Study. The
cut-off grade delineated the material to be included in the Ore Reserve
estimate but subsequent activities such as the metallurgical test work, mine
and processing production schedule and operating cost estimate provided the
final values for the modifying factors which have been included into the
financial model. The Competent Person assessed these small discrepancies and
concluded that no material impact on the final technical and economic outcome
of the Miraflores Feasibility Study is evident. Ore ReservesProved: 1.70Mt @
2.75g/t Au and 2.20g/t AgProbable: 2.62Mt @ 3.64g/t Au and 3.13g/t AgProved
and Probable: 4.32Mt @ 3.29g/t Au and 2.77g/t Ag
AUSENCO
Audit or reviews
The results of any audits or reviews of Ore Reserve estimates.
No formal audits have been conducted on the Mineral Reserve estimate
Metminco
Discussions of relative accuracy/confidence
Where appropriate a statement of the relative accuracy and confidence level in
the Ore Reserve 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 reserve
within stated confidence limits, or, if such an approach is not deemed
appropriate, a qualitative discussion of the factors which 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.
Accuracy and confidence discussions should extend to specific discussions of
any applied
Modifying Factors that may have a material impact on Ore Reserve viability, or
for which
there are remaining areas of uncertainty at the current study stage. It is
recognised that this may not be possible or appropriate in all circumstances.
These
statements of relative accuracy and confidence of the estimate should be
compared with production data, where available.
The Competent Person has recommended that further work be conducted prior to
commencement of construction of the Miraflores Project on the following
topics:
* Geotechnical stability analysis for the underground mine, especially in the
areas containing non-backfilled stopes;
* Stope Backfilling sequence;
* Develop a detailed mining construction schedule;
* Understand the predicted underground water levels; and
* Update the environmental and social costs as per the granted permit - still
to be granted.
This further work may result in some changes to the modifying factors
representing a high risk for the achievement of the technical and economic
outcome of the Miraflores Gold Project delivered by the feasibility study.
Metminco CPs
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