GEMCOM Exploration Planning

8/10/2019 GEMCOM Exploration Planning

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Gemcom Used in Exploration PlanningS A Mawson Geologist, Cheston Minerals (Pty) Limited

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Gemcom GEMS Gemcom Used in Exploration Planning - Mawson

Copyright 2011 Gemcom Software International Inc. Page 2 of 12

Introduction

Cheston Minerals Limited, as a management company now routinely uses Gemcom for modelling a variety

of gold mines in central and southern Africa. There is the Lily open pit mine, an Archaean gold deposit nearMalalane, the Transvaal Gold Mining Estates flat dipping gold reefs at Pilgrim Rest and the Worcesterunderground gold mine near Barberton, all in eastern South Africa. Based on sketchy initial explorationinformation, Gemcom is being used to model the Mugusu project in Tanzania to plan drilling programs. In

Zimbabwe, Gemcom is used for the resource evaluation of the Ayrshire underground gold mine, the Murielunderground gold mine and the Maligreen open pit gold mine. In all of these locations, the Gemcom modelsillustrate where there is sparse data coverage, where data is of poor quality and in-accurate. Gemcomtherefore assists in the refining of routine mine assessment and in the planning of efficient explorationprograms.

Lily Mine Steep-Dipping Archaean Gold Deposit

The Lily Mine is an open pit gold mine located approximately 24 kilometres crow flight north east ofBarberton in the Mpumalanga Province of South Africa (Figure 1). Regionally, the mine workings aresituated along the east-west trending Lily Fault, which defines a major structural break for 20 kilometres

along the northern flank of the Barberton Mountainland. On average, 12,500 tonnes of ore a month istrucked 17 kilometres up the hill to the Makonjwaan CIL plant and about 25 kilograms (800 ounces) of gold isrecovered every month.

GeologyThe Gemcom model at Lily Mine is driven by the lithological and structural controls of the goldmineralization. This is a steeply dipping Archaean deposit where gold mineralization is hosted by a suite of

fault splays emanating from the Lily Fault. This fault is a major stratigraphic break separating theOnverwacht Group metavolcanics forming the lower part of the Lily Syncline in the north, from the Fig TreeGroup metasediments forming part of the Eureka Syncline in the south

1.


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Figure 1: Locality plan for both the Lily Mine and the Pilgrims Rest area.

South of the fault (mine hanging wall) is a 20 to 80 metre wide zone called the Lily Zone2

hosting the

irregularly distributed gold mineralization occurring in an interlayered sequence of banded shales-chert-amphibolite and greywacke (Figure 2).


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Figure 2: Simplified section through the Lily Mineralized Zone.

GemcomIn December 2001, Gemcom Africa (Pty) Ltd was used to initiate a two phase program of data capture,modeling, resource evaluation, mine design and planning. The first phase of the program created a 3D

geological model of the Lily Mine ore bodies and generated a grade model3

. The second phase of the

Gemcom program involved the open pit optimization using Whittle Four-X to derive a profitable economic

shell for a pit to a depth 30 metres below present floor elevation4

. The pit was designed (based on thiseconomic shell) and the scheduling based on the geological block model was completed. From an initial 2year pit life, with the help of Gemcom, the pit life was extended to 7 years of which there are 3 years left

(Figure 3). Thereafter, mining is planned to be from underground.


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Figure 3: Lily planned final pit showing the remaining ore zones to be mined. Looking to the west.

Gemcom is routinely used to report reserve depletion volumes on a monthly basis. These are compared tothe survey measured depletion in the field. The comparison is then used to update the existing block model

(block size changes, search radius changes, algorithm changes and database up-dates) to improve theannual estimation of resources and reserves. The most recent Lily block model is illustrated below in figure4.

Figure 4: Block model of the Intermediate Reef at Lily Mine. Looking north.


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Exploration

The spin-off from this on-going work is that the block model clearly indicates where there are gaps in the

database. This is particularly important for gathering the information that is required for the undergroundfeasibility studies. Therefore, using the Gemcom block model, the next phase of exploration can be targetedspecifically to fill the information gaps. Once the gaps are identified, the model can also be used to plan theinformation density, for example, drill hole spacing. The intersection density should then be adequate to

populate the new block model from which all the future volumetrics are based.

Pilgrims Rest Flat Dipping Proterozoic Gold Reefs

Gold was first discovered in the Sabie Pilgrims Rest area in 1873, and by the time mining ceased in 1971,over 200 tonnes of gold had been won

5

. Regular gold production was again started by Transvaal GoldMining Estate in September 1999. The present monthly gold production is about 25kg (800 ounces), all wonfrom the Rho Reef mined at the Clewer, Morgenzon and Dukes Hill Sections.

Geology

The gold mineralization in the Pilgrims Rest area is located in the eastern margins of the Transvaal Basin,

marked effectively by the Drakensberg escarpment (Figure 1). The stratigraphic succession, in decreasingage upwards, is the Archaean basement granite, minor Godwan Formation sediments and the Transvaal

Supergroup. The mineralization in the area of interest is principally flat bedding parallel shears (dipping 5west) located mainly on shale partings within the Malmani Dolomites. However, there are other reefs located

in the overlying sediments apart from the dolomite. Figure 5 below illustrates the simplified stratigraphysurrounding the Rho Reef.


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Figure 5: Simplified Stratigraphic section through the Rho Reef.

At the TGME Mine, the Top Rho Reef is mined from Morgenzon section in the north, through the Clewersection in the middle, to the Dukes Hill section in the south, a distance of 2.3 kilometres. The reef averages

25 centimetres in thickness, contains up to 98% modal content of pyrite (averages 60% pyrite) that hostsabout 95% of the contained gold (Plate 1). Gentle open folding of the reef accounts for thicker mineralizationand changes in dip and strike are seldom more than a degree or two. Gold mineralization is accompanied byvarious sulphides of Fe, Cu, As, Sb and Bi, but fortunately the sulphidic gold ores are not refractory in the

true sense6.


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Plate 1: Top Rho reef containing 75% course grained pyrite in quartz andcalcite hosted by dolomite and black chert.

Exploration

The Rho Reef is known and the hosting stratigraphy well understood. There is no need to look for it onsurface by mapping, geochemistry or geophysics. It is keeping the miners on payable reef that is a whole

new exploration problem. The reef thickness is irregularly distributed and the gold distribution within this reefis very erratic. Stope payability averages 40% and may get up to 60%. By developing on reef, there is noway of carrying out underground diamond drilling ahead of development without the large expense of raising

and driving in waste to construct drill cubbies. With regard to drilling from surface, the fact that the reef dipswest, while the rugged topography increases in height westwards, surface diamond drilling 800 to 1000metre holes hoping for a 25 centimetre intersection of which, at best, 4 out of 10 may indicate payable reef isnot feasible. Exposing new ore is therefore done only by developing on reef. The problem in this case is to

try and identify trends of payability along which the miners can expect good reef with out too much wastemining.

Gemcom

Underground sampling of the Rho Reef at TGME takes the form of channels cut perpendicularly across thereef. At each sample site, the position (Lo based X and Y co-ordinate) and channel width is recorded. Thechannels are spaced at 2 metre intervals along each wall of the development and 2 metres apart along stope

faces that are sampled after every 3 metres of advance. Therefore every exposure of Rho reef undergroundis sampled at least at a 2m x 3m interval (sometimes closer). Over the 2 kilometres of exposed reef strike,there is now a database comprising 13! thousand assay results recording the position, width, grade andvalue (cmg/t Au) of each sample

Various packages have been used to contour gold grade, reef width and gold value trends, and in each

case, the packages were felt to be unsatisfactory for a number of reasons. At the same time, no preferentialmineralization or reef width trends were identified and it was thought this could be due to those contouring


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methods. With the assistance of Gemcom Africa Limited, a block model of the Rho reef was generated usinga block of horizontal dimensions 1metre x 1metre. Each block is 1 centimetre thick. Each of these 720,000thin blocks was kriged and populated with a cmg/t gold value using ID "on a horizontal search radius of 5

metres. In addition, by colouring each block according to the value, a coloured pixel plan of the reef valueis made. If there are any preferential reef value trends (if they do indeed exist) they should be highlighted inthe resultant plan. An example is illustrated in figure 6 below, but it takes a lot of imagination to see anytrends there at all. The company is going to have to settle for the fact that gold mineralization in the Rho

Reef is erratically distributed with no preferred trends. At this stage, reef and as a result, stope preparation,is going to remain an expensive exercise. Fortunately this is offset by high gold grades and the relativelysimple metallurgy of the Rho Reef.

Figure 6: A 2 kilometre strike of the Top Rho Reef depicted as a Gemcom generated block model, each blockbeing 1m x 1m x 0.01m in size and populated with the cmg/t Au coloured to give a pixel style plan to indicate

mineralization trends if they do indeed exist.

Detail showing the 1 m blocks populated with the Cmg/t Auvalues as per the colour key below.

Values as cmg/t Au for the Top Rho Reef.


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Tanzania Mugusu Project Gold Exploration

Location and History

The Mugusu Project is a fairly advanced gold exploration project belonging to Shanta Mining Company

Limited. It is located in the Geita Greenstone Belt about 100 kilometres west south west of Mwanza innorthern Tanzania, 14 kilometres west of the Geita Gold Mine (Figure 7).

Figure 7: Locating the Mugusu Project in northern Tanzania.

Gold was first discovered at Mugusu in 1913, with sporadic mining and prospecting occurring since then.Pangea Minerals started drilling in 1996 and published an indicated gold resource estimated to 100 metresbelow surface. In-fill drilling early in 1998 refined the resource down to 70 metres below surface but excludedthe upper 25 metres, which has been turned over by the artisanal miners. Work to date has entailedgeological mapping, soil and rock sampling, 1,855 metres of reverse circulation drilling from 23 holes and

1,630 metres of diamond drilling from 8 holes7

. The mapping, sampling and drilling information was used toconstruct the initial model.


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Geology

Gold is associated with shearing occurring in intrusive quartz felspar porphyry located in the upper NyanzanTuffs. The immediate footwall of the mineralization is hard and massive banded ferruginous chert.Mineralization occurs as auriferous sulphides and stockwork quartz-sulphide veining in the sheared quartz

felspar porphyry. Mineralization strikes about azimuth 60 and dips around -50 to the southwest. Dip nearsurface is -75 and it shallows with depth to about -40 some 200 metres below surface.

Gold mineralization occurs over a 500 metre strike length while the main mineralized zone is about 300metres long and up to 60 metres wide. Initial drilling indicates that the zones continue in depth to beyond 200metres. For the purposes of the exploration planning, an open pit potential was assumed and had to beproved to 100 metres below surface. The initial Pangea drilling certainly indicates that this is feasible.

Gemcom

The information used to create the initial model comprises geological mapping, 142 surface survey points,

489 rock chip and channel sample assays and 1,434 and 1,939 diamond and RC assay results respectively.Using these data, an initial solid geological model was constructed from screen digitized sections. A blockmodel was generated and then populated using ID" (Figure 8). The volumetrics was used to estimate arough geological resource of the potential in-situ gold content bearing in mind that this information base is

compiled from partly unreliable information.

Figure 8: The Mugusu Project block model looking north east.


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