Mr. Alex van Hoeken reports
KILO GOLDMINES LTD.: MAIDEN MINERAL RESOURCE ESTIMATES FOR THE KITENGE AND MANZAKO GOLD DEPOSITS AND UPDATED MINERAL RESOURCE ESTIMATE FOR THE ADUMBI GOLD DEPOSIT
Kilo Goldmines Ltd. has provided the results of its Canadian National Instrument (NI) 43-101 mineral resource estimate (MRE) for its 71.25-per-cent interest in the Somituri project consisting of the Adumbi, Kitenge and Manzako gold deposits.
An independent updated MRE was prepared for the Adumbi deposit, and maiden inferred mineral resources were estimated for the Kitenge and Manzako deposits by Canadian consulting firm Roscoe Postle Associates Inc. (RPA), geoscientists and engineers in London, United Kingdom, and Toronto, Canada.
Highlights
-
The total estimated inferred mineral resource at the Somituri project
contains an estimated 1,675,000 ounces of gold (see "Mineral resource estimate for the Somituri project's Imbo
licence" table) at a
grade of 2.5 grams per tonne Au. The mineral resource estimates are based on an open
pit scenario at Adumbi and an underground scenario at Kitenge and
Manzako. Gold grades have been capped and the resources at Adumbi have
been constrained by a Whittle pit.
-
Based on a comparison using uncapped gold grades and no Whittle
constraint, the 2013 Adumbi resource estimate gold grades and contained
ounces have increased compared with the 2012 estimate. At a cut-off grade
of 1.0 g/t Au, these have increased from 2.0 g/t Au to 2.4 g/t Au and
from 1.61 million ounces to 1.78 million ounces, respectively.
-
The updated 2013 mineral resource estimate for Adumbi is 19.11 million tonnes at 2.2
g/t Au for a total of 1,362,000 ounces of gold.
-
Maiden inferred mineral resource estimates for the Kitenge and Manzako
deposits are 191,000 and 122,000 ounces respectively. The Kitenge and Manzako
drill hole spacing is currently too wide to determine high-grade plunge
direction(s), hence the high-grade shoots could not be modelled
separately and the gold grade was capped universally at 50 g/t Au.
-
There is excellent potential to expand the inferred mineral resources
with more drilling. Greater than 50 per cent of the mineralized blocks at
Kitenge and Manzako were not classified as mineral resources in areas of
wide-spaced drilling. Additional drilling could determine if part of the
resource at either deposit could be potentially be mined with a starter
open pit.
-
Gold mineralization at Adumbi, Kitenge and Manzako remains open along
strike and at depth.
-
RPA has recommended infill drilling, increased quality assurance/quality control programs, digital
terrain surveys, in addition to the resurvey of drill collars and
historical workings on the Adumbi deposit in order to potentially
increase the resource size and upgrade mineral resources from inferred
to indicated status.
The updated 2013 RPA estimate for Adumbi was based on a review of the Adumbi deposit including remodelling, grade capping and considering the CIM requirement for mineral resources to have "reasonable prospects for economic extraction." The RPA estimates for Kitenge and Manzako are based on drilling results that were available to Nov. 15, 2013.
The "Mineral resource estimate for the Somituri project's Imbo
licence"
table shows the current mineral resource estimate for the Somituri project's Imbo licence.
MINERAL RESOURCE ESTIMATE FOR THE SOMITURI PROJECT'S IMBO
LICENCE, DEC. 31, 2013
Inferred mineral resources
Gold
cut-off Gold Contained
Mining grade Tonnes grade gold
Deposit method (g/t) (Mt) (g/t) (Moz)
Adumbi Open pit 0.90 19.11 2.2 1.362
Kitenge Underground 2.70 0.91 6.6 0.191
Manzako Underground 2.70 0.77 5.0 0.122
Total 20.78 2.5 1.675
1. CIM definitions were followed for mineral resources.
2. Mineral resources were estimated at a cut-off grade of 0.9 g/t Au for
Adumbi, constrained by a Whittle pit shell with a processing and general
and administrative cost of $30 (U.S.). A cut-off grade of 2.7 g/t Au was
used for Kitenge and Manzako based on potential underground mining
scenarios.
3. Mineral resources were estimated using a long-term gold price of
$1,200 (U.S.) per ounce.
4. A minimum mining width of two metres horizontal was used.
5. A maximum of four metres internal waste was used.
6. Adumbi bulk densities of 1.8 for oxide, 2.2 for transition, and 3.0 for
sulphide materials were used.
7. Kitenge and Manzako bulk densities of 1.7 for oxide, 2.2 for transition
and 2.7 for sulphide materials were used.
8. High gold assays were capped to 18.0 g/t Au for Adumbi, 50.0 g/t Au for
Kitenge and 50.0 g/t Au for Manzako prior to compositing at two-metre
intervals.
9. Estimated historical mining has been removed.
10. Numbers may not add due to rounding.
Commenting on today's independent MREs, Kilo's president and chief executive officer Alex van Hoeken, said: "We are very pleased that not only has the RPA resource model on the Adumbi deposit shown a major improvement in ounces and gold grade when compared with the previous inferred mineral resource estimate, it also remains robust within newly applied constraining parameters as a first step towards economic modelling.
"Our updated mineral resource estimate reaffirms that the Adumbi deposit has significant gold mineralization, and potential remains to significantly increase both the gold grade and number of ounces with further geological understanding of the control of mineralization and systematic infill and step-out drilling. In addition, the preliminary test work indicates that Adumbi is in most parts non-refractory with a significant gravity recoverable gold component, thus indicating a potentially economically extractable deposit.
"The maiden resource estimates at the Kitenge and Manzako deposits firmly establish the concept of being able to delineate additional gold resources within a short radius on the Imbo licence which supports our team's exploration guideline for increasing resources to establish a multipit single plant mining operation. The high-grade gold in these deposits is particularly encouraging. Moreover, the licence has many more untested targets as defined by historical colonial workings, artisanal workings, airborne geophysical and soil geochemical and surveys. All of these exploration targets warrant testing for additional resources in due course."
2013 mineral resource estimate for the Somituri project's Imbo licence
In 2013, the company appointed RPA to update the 2012 inferred MRE on Adumbi and prepare a maiden MRE for the Manzako and Kitenge gold deposits.
The methodology applied and the results are presented in the following sections.
Results
Based on the preliminary cost and revenue parameters applied in the preparation of the MRE, Adumbi is considered potentially economic at a cut-off grade of 0.90 g/t Au as an open-pit (1:7 strip ratio) deposit, whilst Kitenge and Manzako are considered potentially economic at a cut-off grade of 2.70 g/t Au by underground mining methods. Further exploration on Kitenge and Manzako may be able to delineate mineralization near surface and establish a starter surface pit.
The inferred MRE for the Adumbi, Manzako and Kitenge deposits based on the aforementioned parameters and the combined resource estimate for the Imbo licence as of Dec. 31, 2013, are summarized and discussed in the following sections.
The Adumbi, Kitenge and Manzako gold deposits occur within a four-kilometre radius of a central point on the 133-square-kilometre Imbo licence.
Adumbi
The "Inferred mineral resource estimate for Adumbi, as a function of
cut-off grade" table illustrates inferred MRE tonnes and grade subject as a function of cut-off grades and the effect of capping assayed gold values at 18 g/t Au for the Adumbi deposit.
INFERRED MINERAL RESOURCE ESTIMATE FOR ADUMBI, AS A FUNCTION OF
CUT-OFF GRADE
Inferred mineral resources --
capped at 18 g/t Au Uncapped
Contained Contained
Cut-off Tonnes Grade gold Grade gold
(g/t Au) (Mt) (g/t Au) (Moz) (g/t Au) (Moz)
Greater than or
equal to 5.00 0.395 5.9 0.074 8.6 0.109
Greater than or
equal to 4.50 0.956 5.2 0.160 6.5 0.200
Greater than or
equal to 4.00 1.946 4.7 0.295 5.5 0.342
Greater than or
equal to 3.50 3.002 4.4 0.422 5.0 0.478
Greater than or
equal to 3.00 4.247 4.0 0.552 4.5 0.621
Greater than or
equal to 2.50 5.907 3.7 0.699 4.1 0.783
Greater than or
equal to 2.00 8.256 3.3 0.867 3.7 0.969
Greater than or
equal to 1.50 12.617 2.7 1.109 3.1 1.241
Greater than or
equal to 1.00 18.179 2.3 1.333 2.5 1.486
Greater than or
equal to 0.90 19.107 2.2 1.362 2.5 1.517
Greater than or
equal to 0.50 21.886 2.0 1.428 2.3 1.589
1. CIM definitions were followed for mineral resources.
2. Mineral resources were estimated at a cut-off grade of 0.9 g/t Au for
Adumbi, constrained by a Whittle pit shell with a processing and general
and administrative cost of $30 (U.S.). A cut-off grade of 2.7 g/t Au was
used for Kitenge and Manzako based on potential underground mining
scenarios.
3. Mineral resources were estimated using a long-term gold price of
$1,200 (U.S.) per ounce.
4. A minimum mining width of two metres horizontal was used.
5. A maximum of four metres internal waste was used.
6. Adumbi bulk densities of 1.8 for oxide, 2.2 for transition, and 3.0 for
sulphide materials were used.
7. Kitenge and Manzako bulk densities of 1.7 for oxide, 2.2 for transition
and 2.7 for sulphide materials were used.
8. High gold assays were capped to 18.0 g/t Au for Adumbi, 50.0 g/t Au for
Kitenge and 50.0 g/t Au for Manzako prior to compositing at two-metre
intervals.
9. Estimated historical mining has been removed.
10. Numbers may not add due to rounding.
A comparison of the 2012 and 2013 inferred MREs prepared by the Mineral Corp. of South Africa (2012) and RPA (2013) is presented in the "Comparison of 2012 and 2013 Adumbi block models" table. The contained ounces and gold grade for the 2012 Adumbi estimate was based on uncapped grades and was unconstrained by a preliminary pit shell.
COMPARISON OF 2012 AND 2013 ADUMBI BLOCK MODELS
The Mineral Corp. (2012) RPA (2013)
Contained Contained
Cut-off Tonnes Gold gold Tonnes Gold gold
(g/t Au) (Mt) (g/t) (Moz) (Mt) (g/t) (Moz)
Greater than or
equal to 0.50 35.66 1.63 1.87 29.57 2.06 1.96
Greater than or
equal to 1.00 24.06 2.04 1.61 23.26 2.39 1.78
Greater than or
equal to 1.50 15.52 2.50 1.25 15.19 2.91 1.42
Greater than or
equal to 2.00 9.55 2.99 0.92 9.47 3.52 1.07
Greater than or
equal to 2.50 6.19 3.41 0.68 6.30 4.07 0.82
Greater than or
equal to 3.00 3.81 3.83 0.47 4.39 4.53 0.64
Notes:
1. The Mineral Corp. 2012 block model is unconstrained and has uncut
gold grades.
2. The RPA 2013 block model estimate is reported as unconstrained and with
uncut gold grades for comparative purposes only.
With respect to the Adumbi deposit, the following points should be noted:
- RPA has indicated that:
-
By geo-referencing the drill collars to a digital terrain survey, as
well as resurveying historical workings, it is possible that the
mineral resource classification could be upgraded to the indicated
category in some areas of the deposit.
-
Infill and step-out drilling may confirm the continuity of the
resource and assign grade and ounces to areas tapered due to the
inherent modelling parameters diminishing grade influence with
distance from the hole.
-
A comparison between the 2012 and 2013 uncapped versions of the Adumbi
inferred MRE show that in general, at a cut-off grade of one g/t Au or
above, grade and total ounces have increased on average over the cut-off
ranges indicated by 18 per cent and 20 per cent respectively.
Kitenge
The "Inferred mineral resource estimate for Kitenge, as a function of
cut-off grade" table presents the inferred MRE size and grade as a function of gold cut-off grade, with and without the application of a 50 g/t Au cap, for Kitenge.
The inferred MRE for Kitenge has been prepared using a 50 g/t gold cap and a 2.7 g/t gold underground cut-off grade.
INFERRED MINERAL RESOURCE ESTIMATE FOR KITENGE, AS A FUNCTION OF
CUT-OFF GRADE
Inferred mineral resources --
capped at 50 g/t Au Uncapped
Contained Contained
Cut-off Tonnes Grade gold Grade gold
(g/t Au) (Mt) (g/t Au) (Moz) (g/t Au) (Moz)
Greater than or
equal to 5.00 0.46 9.1 0.134 15.8 0.233
Greater than or
equal to 4.50 0.64 7.9 0.161 12.9 0.263
Greater than or
equal to 4.00 0.71 7.5 0.171 12.0 0.274
Greater than or
equal to 3.50 0.81 7.0 0.183 11.0 0.287
Greater than or
equal to 3.00 0.85 6.8 0.188 10.7 0.293
Greater than or
equal to 2.70 0.91 6.6 0.191 10.2 0.297
1. CIM definitions were followed for mineral resources.
2. Mineral resources were estimated at a cut-off grade of 0.9 g/t Au for
Adumbi, constrained by a Whittle pit shell with a processing and general
and administrative cost of $30 (U.S.). A cut-off grade of 2.7 g/t Au was
used for Kitenge and Manzako based on potential underground mining
scenarios.
3. Mineral resources were estimated using a long-term gold price of
$1,200 (U.S.) per ounce.
4. A minimum mining width of two metres horizontal was used.
5. A maximum of four metres internal waste was used.
6. Adumbi bulk densities of 1.8 for oxide, 2.2 for transition, and 3.0 for
sulphide materials were used.
7. Kitenge and Manzako bulk densities of 1.7 for oxide, 2.2 for transition
and 2.7 for sulphide materials were used.
8. High gold assays were capped to 18.0 g/t Au for Adumbi, 50.0 g/t Au for
Kitenge and 50.0 g/t Au for Manzako prior to compositing at two metre
intervals.
9. Estimated historical mining has been removed.
10. Numbers may not add due to rounding.
Manzako
The "Inferred mineral resource estimate for Manzako, as a function of
cut-off grade" table presents the inferred MRE size and grade as a function of gold cut-off grade, with and without the application of a 50 g/t gold assay cap, for Manzako.
The inferred MRE for Manzako has been prepared using a 50 g/t gold cap and a 2.7 g/t gold underground cut-off grade.
INFERRED MINERAL RESOURCE ESTIMATE FOR MANZAKO, AS A FUNCTION OF
CUT-OFF GRADE
Inferred mineral resources --
Au capped at 50 g/t Uncapped
Contained Contained
Cut-off Tonnes Grade gold Grade Gold
(g/t Au) (Mt) (g/t Au) (Moz) (g/t Au) (Moz)
Greater than or
equal to 5.00 0.271 7.4 0.064 17.5 0.153
Greater than or
equal to 4.50 0.339 6.8 0.075 15.5 0.169
Greater than or
equal to 4.00 0.398 6.5 0.083 14.0 0.180
Greater than or
equal to 3.50 0.547 5.7 0.101 11.5 0.203
Greater than or
equal to 3.00 0.691 5.2 0.116 9.9 0.219
Greater than or
equal to 2.70 0.766 5.0 0.122 9.2 0.227
1. CIM definitions were followed for mineral resources.
2. Mineral resources were estimated at a cut-off grade of 0.9 g/t Au for
Adumbi, constrained by a Whittle pit shell with a processing and general
and administrative cost of $30 (U.S.). A cut-off grade of 2.7 g/t Au was
used for Kitenge and Manzako based on potential underground mining
scenarios.
3. Mineral resources were estimated using a long-term gold price of
$1,200 (U.S.) per ounce.
4. A minimum mining width of two metres horizontal was used.
5. A maximum of four metres internal waste was used.
6. Adumbi bulk densities of 1.8 for oxide, 2.2 for transition, and 3.0 for
sulphide materials were used.
7. Kitenge and Manzako bulk densities of 1.7 for oxide, 2.2 for transition
and 2.7 for sulphide materials were used.
8. High gold assays were capped to 18.0 g/t Au for Adumbi, 50.0 g/t Au for
Kitenge and 50.0 g/t Au for Manzako prior to compositing at two metre
intervals.
9. Estimated historical mining has been removed.
10. Numbers may not add due to rounding.
Combined inferred mineral resource estimate for the Imbo licence
Based on gold caps of 18 g/t Au and 50 g/t Au and cut-off grades of 0.9 g/t Au and 2.7 g/t Au for open cast and underground mining respectively, the combined inferred MRE for the Imbo licence is presented in the "Mineral resource estimate for the Somituri project's Imbo
licence" table.
It is important to note that all resources defined to date fall within a four-kilometre radius of a defined central point on the company's Imbo licence, which is in alignment with the company's business strategy of creating a central processing hub on this licence.
Furthermore, the Imbo licence hosts a number of historical and artisanal gold workings unrelated to the modelled resources. Exploration, will in part at least, focus on evaluating untested targets with the objective of delineating additional zones of gold mineralization.
Methodology
In accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) definition standards (2010), RPA used a combination of Whittle analysis and underground block mining grade cut-off calculations, to estimate open pit and underground inferred mineral resources.
RPA generated wireframe models for each of the mineralized lenses, based on a 0.5 g/t gold cut-off that were used in geological and grade continuity studies in order to constrain the block model interpolation. Three-dimensional models of the Imbo lenses were constructed in a collaborative effort by Kilo and RPA. Mineral resources were estimated by an inverse distance cubed (ID3) method. Historical mining was estimated and removed from the block models. A two-metre minimum mining width and a maximum of four metres of internal waste was applied to all of the deposits.
The key parameters employed in estimating cut-off grade and inferred mineral resources are summarized below:
- Open pit mining (Whittle inputs for Adumbi):
- Block size: eight metres by eight m by eight m;
-
Pit slope angle: minus 45 degrees;
-
In-situ bulk densities: 1.8 grams per cubic metre for oxide; 2.2 grams per cubic centimetre for
transition and 3.0 grams per cubic centimetre for sulphide;
-
Mining cost: $2 (U.S.) per ton waste; $2.50 (U.S.) per ton run-of-mine (RoM);
-
Mining extraction: 95 per cent;
-
Mining dilution: 5 per cent;
-
Historic mining: estimated and removed from block model;
-
Capped gold grade: 18 g/t.
- Underground mining (Manzako and Kitenge)(1):
-
Block size: eight m by eight m by eight m;
-
Capped gold grade: 50 g/t prior to compositing at two m intervals;
-
Mining cost: $60 (U.S.) per ton;
-
In-situ bulk densities: 1.7 grams per cubic centimetre for oxide; 2.2 grams per cubic centimetre for
transition and 2.7 grams per cubic centimetre for sulphide;
-
Historic mining: estimated and removed from block model;
-
Lenses displayed: resource blocks with a grade equal to or greater than 2.7 g/t.
- Process, general and administration (G&A) costs and others:
-
RoM throughput: 3.0 million tonnes per annum (dry);
-
Gold recovery: 90 per cent;
-
Process and G&A cost: $30 (U.S.) per ton;
-
Gold price: $1,200 (U.S.) per ounce;
-
Royalty: $4.50 (U.S.) per ounce.
(1) More than 50 per cent of the interpolated blocks were observed to be non-contiguous or not within 40 m of a mineralized drill hole and were hence, considered un-classifiable pursuant to CIM definitions and excluded from the MRE.
Quality assurance, quality control and data verification
HQ-sized core (63-millimetre diameter core) was drilled through the transition zone from highly weathered and/or oxidized units to fresh unweathered competent rocks. The fresh rock was drilled with NQ-sized drill rods, producing 48 mm diameter core. Recoveries averaged greater than 95 per cent within the mineralized zones.
Assaying of Kilo's samples was completed at ALS Minerals, an independent, ISO-credited laboratory in Johannesburg, South Africa, using fire assay fusion, followed by a gravimetric analysis procedure. Quality assurance and quality control was monitored and audited by Kilo with a quality-control program, which included standards, blanks, repeats and internal ALS Minerals quality-assurance procedures.
RPA recompiled the Somituri project drill hole database including all assay data. In RPA's opinion, the main limitations on verifying assay data are the lack of diamond drill core duplicate sampling as well as poor correlation within the Kilo inserted standards and laboratory standards.
Qualified persons
Disclosures of a scientific or technical nature in this release have been approved by Stanley Robinson, PGeo, exploration manager of Kilo and a qualified person for the purpose of National Instrument 43-101.
The 2013 mineral resource estimate for the Somituri project disclosed in this news release have been prepared by Ian Blakley, PGeo, an employee of RPA and independent of Kilo. Mr. Blakley is a qualified person for the purpose of National Instrument 43-101. The mineral resources have been classified in accordance with CIM definition standards for mineral resources and mineral reserves (November, 2010). Mr. Blakley has read and approved the contents of this news release as it pertains to the disclosed mineral resource estimate.
RPA's complete NI 43-101-compliant technical report will be filed on SEDAR, as soon as practical and within 45 days of this press release.
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