Ntem, Cameroon

Ntem exploration permit

Overview

  • Ownership: 100% subject to Government right to 10% free carried interest
  • Licence area: 245km2. Renewable exploration licence for iron ore (and other minerals, including gold)
  • Location: South-west Cameroon, located only 80km from the Government-led, deep-water port complex, which has recently been constructed
  • Potential to use 216MW Kribi power station, commissioned by AES-Sonel, the State power company, in H1 2013
  • Updated Mineral Resource Estimate (MRE2) issued in March 2013
    • 96.9 Mt at 34.9% Fe Indicated
    • 79.4Mt at 35% Fe Inferred
  • Pilot-scale metallurgy results indicate that a high-grade concentrate of up to 70% Fe is achievable at a coarse grind size and high recovery rates
  • Slurry Pipeline option assumed to transport the iron concentrate to the recently completed port at Kribi
  • Further work will examine the potential to realise early cash flow from a small-scale operation using one of the berths created in phase 1 of the port development

Resource Estimate

Table 1: Nem (Fe08 and Fe11), Mineral Resource Estimate (MRE2)

Zone Resource Category Tonnes (Mt) Fe % SiO2 % Al2O3 % P %
Oxidised Itabirite Measured
Indicated
Meas. + Ind.
Inferred 24.2 36.74 39.79  3.83 0.047
Fresh Itabirite Measured
Indicated 96.9 34.92 44.41 1.59 0.056
Meas. + Ind. 96.9 34.92 44.41 1.59 0.056
Inferred 55.3 34.29 44.96 1.67 0.060
TOTAL Measured
Indicated 96.9 34.92 44.41 1.59 0.056
Meas. + Ind. 96.9 34.92 44.41 1.59 0.056
Inferred 76.4 35.04 43.39 2.33 0.056

Notes:

(1) Mineral Resources which are not Mineral Reserves have no demonstrated economic viability.

(2) The effective date of the Mineral Resource is 24 February 2015.

(3) The Mineral Resource Estimate for the Ntem deposit was constrained within lithological and grade based solids and within a Lerchs-Grossman optimised pit shell defined by the following assumptions; metal price of USD1.5/dmtu; slope angles of 16º and 41º in the oxide and fresh material; a mining recovery of 95.0%; a mining dilution of 5.0%; a base case mining cost of USD1.60/t and incremental mine operating costs of USD0.05/t/10 m; process operating costs of USD4.20/t for crushed oxide and USD5.50/t for crushed itabirite ore; Oxide processing recovery of 60%; Itabirite processing recovery of 88% and G&A costs of USD0.78/t and USD0.96/t in oxide and itabirite ore respectively.

(4) Mineral Resources for the Ntem Fe08 and Fe11 deposits have been classified according to the "CIM Standards on Mineral Resources and Reserves: Definitions and Guidelines (December 2005)" by Howard Baker (FAusIMM(CP)), an independent Qualified Person as defined in NI 43-101.

Table 2: Results of pilot-scale LIMS testing of Ntem samples

Grind Size (µm P80) Feed Fe % Mass Rec % Fe Rec % Fe % SiO2 % Al2O3 % P % S %
75 37.4 44.2 80.9 68.5 4.25 0.12 0.01 0.00
106 37.2 44.9 81.2 67.2 6.14 0.17 0.01 0.00
150 37.3 46.7 81.6 65.2 8.55 0.24 0.01 0.01

Multiple Targets Identified by Airborne Magnetics

Multiple Targets Identified by Airborne Magnetics

Current Drill Programme at Ntem

The updated Mineral Resource Statement was based on a total of 109 diamond drill holes for 17,020 m

Fe08 drillhole collars overlain on the ground magnetic survey map

Current Drill Programme at Ntem

Fe11 drillhole collars overlain on the airborne magnetic survey map

Current Drill Programme at Ntem

Database Validation

The QA/QC programme for Ntem involves the insertion of blank, standard and duplicate samples into the sample stream at an insertion rate of 1 in 20. The Company uses multiple standards of variable grade, representative of the deposit. Samples are assayed at the accredited ALS Minerals laboratory Johannesburg. SRK found that the results of the QA/QC programme indicated that the Ntem assay database is suitable for use in a Mineral Resource Estimate.

Data Verification

SRK have verified that the data on which MRE2 is based is correct and viable for use in a Mineral Resource Estimate. This verification included an assessment of QA/QC data, sample preparation and assay methodologies, density data, data inputs and survey data used in the estimate. Data was validated by using field checks, statistical methods and evaluating the Company's protocols.