Source - LSE Regulatory
RNS Number : 0738Q
Red Rock Resources plc
23 February 2021
 

 

Red Rock Resources PLC

 

Mineral Resource Update

 at the Mikei Gold Project, Kenya (JORC, 2012)

Mineral Resource of 723 koz at 1.49 g/t Reported

 

22 February 2021

 

Red Rock Resources Plc ("Red Rock" or "the Company"), the natural resource development company with interests in gold, copper/cobalt, manganese and minerals, announces the completion of a Mineral Resource estimate ("MRE") updated to comply with the 2012 edition of the Code published by the Australasian Joint Ore Reserves Committee ("JORC") over parts of Red Rock's exploration license at Mikei, Migori, Kenya comprising the Mikei Gold Project ("MGP"). The supporting documentation (the "Report") was prepared by CSA Global (UK) Limited ("CSA Global").     

The Report documents the results of Mineral Resource estimation work initially conducted in 2011 and 2012 and revised in 2021 in order to report the Mineral Resource according to JORC (2012) guidelines. MGP was assessed for reasonable prospects for eventual economic extraction (RPEEE) by applying conceptual benchmarked costs to calculate conceptual reporting pit shells. Any material outside or below the reporting pit shell was updated as "Not Classified" since it did not meet the criteria to be reported as a Mineral Resource.

The total Mineral Resource, for both Inferred and Indicated categories at a 0.5 g/t Au cut-off, is estimated at:

15.13 Mt @ 1.49 g/t Au with contained metal content of 723 koz Au

Key Points

·    MRE covered the five prospect areas covered by the 2012 MRE

·    Application of RPEEE principles required by JORC (2012) led to the exclusion of some previously estimated Mineral Resource areas and a consequent 39% reduction in reported ounces of gold

·    Gold grade of the MRE for the same reason increased by 18% to 1.49 g/t

·    Some material previously stated as Indicated in the oxidised zone has been downgraded to Inferred, reflecting uncertainties relating to the terrain model and the extent of artisanal activity since 2012

·    Detailed recommendations for a first stage step-out drilling programme made to potentially increase the size of the MRE 

 

Red Rock Chairman Andrew Bell comments: "We are delighted to announce an updated Mineral Resource at Mikei, with a higher gold grade. These conceptual pit shells used to test for reasonable prospects of extraction will now act as a springboard for our future exploration which will be focused on Resource enhancement. 

After having been for several years prevented from carrying out work on the property while other nearby projects in Tanzania and Kenya progressed, the first necessary steps on our return were to conduct updated baseline and Resource studies, and to prepare an immediate programme to upgrade and extend our Mineral Resource.

Updating our Mineral Resource Estimate to JORC (2012) was essential if we were to make public reference to it, and the exercise of complying with it has been invaluable in two ways.

First, the application of conceptual benchmarked costs to calculate conceptual reporting pit shells ensures that the reported Mineral Resource is aligned with a modern, industry-recognised method of testing for reasonable prospects for eventual economic extraction. This together with the higher grade within the conceptual pit shells enables us to report a Mineral Resource that looks more robust in the context of current gold prices.

Secondly, the exercise of working out what, on the assumptions made, lay outside the pit shell but nearby or along strike showed us where targeted step-out drilling might prove effective in extending the pit, and so gave us our first 14, and mainly shallow, new drill hole locations. These we can test without delay while planning further programmes for infill and step-out drilling and for testing mineralisation at depth.

We now have the opportunity to build on this solid base and it is our belief that the potential for expansion at and around Mikei is strong".          

Background

The MGP comprises two prospecting licences which cover approximately 245 km2, namely PL/2018/0202 and PL/2018/0203, over the Migori Greenstone Belt, and are located along the northern margin of the Tanzanian Craton. The licences extend 63 km along strike of the belt, which also hosts the Kilimapesa Gold Mine. The North Mara Gold Mine, which is operated by Barrick Gold, is located 30 km to the south of the MGP in Tanzania.

Regional exploration in the project area began in the early 1930s and culminated in the identification and subsequent mining of the Macalder volcanogenic massive sulphide (VMS) base metal mine.

In 2010, Red Rock began the extensive task of file organisation, data digitisation and compilation of available historical data, following which CSA Global performed cross-checks and validation steps prior to loading it into a Structured Query Language (SQL) database using Datashed. During 2011 and 2012, Red Rock undertook an infill drilling programme at all five of the lode gold prospects; MK, Kakula-Kalange-Munyu (KKM), Kakula-Kalange-Munyu West (KW), Nyanza (NZ), and Gori Maria (GM) within PL/2018/0202.

http://www.rns-pdf.londonstockexchange.com/rns/0738Q_1-2021-2-23.pdf [Figure 1: Total field aeromagnetic imagery for the Mikei area collected by Red Rock, with drill collars annotated in yellow and surface structural dip and dip-directions as red triangles]

 

The Report documents the results of Mineral Resource estimation work initially conducted in 2011 and 2012 and revised in 2021 in order to report the Mineral Resources according to JORC (2012) guidelines. No new data is available since the 2012 report, and as such, those estimates remain valid and disclosure to JORC (2012) is the focus of the Report.

Mineral Resource Estimate and Comparison with Previous Estimate

The Mineral Resource has been estimated using geological models developed by Red Rock and CSA Global. The MRE has been undertaken using ordinary kriging (OK) on volume block models for all prospects. Consideration of natural grade populations, along with top cutting, compositing and variography has been completed for all prospects. This has produced robust 3D grade models for each prospect, that can be used for conceptual mine planning studies and further exploration planning.

The MRE is reported in accordance with JORC (2012) guidelines, following the application of reasonable prospects of eventual economic extraction by means of pit shells supported by conceptual cost and gold price forecast parameters. The Mineral Resource is reported at a cut-off of 0.5 g/t Au.

The JORC Code (2012) defines a Mineral Resource as a concentration or occurrence of solid material of economic interest in or on the Earth's crust in such form, grade (or quality), and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade (or quality), continuity and other geological characteristics of a Mineral Resource are known, estimated, or interpreted from specific geological evidence and knowledge, including sampling. Mineral Resources are subdivided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories.

The Mineral Resource estimate for all MGP prospects is reported according to the JORC (2012) guidelines. The geology for each prospect is broadly understood. Sectional interpretations were undertaken using geological information, structural measurements, and grade relationships. The statistical grade characteristics of the individual prospects are generally well understood, and a reasonable amount of density determinations were conducted to ensure an acceptable level of confidence in the bulk density of the material being reported as Mineral Resources.

Prior to Mineral Resource classification, a review of all historical and modern supporting data was undertaken. CSA Global concluded that there is adequate confidence in both the historical and Red Rock data to classify areas of the Mineral Resource as either Indicated or Inferred. Classification was further reviewed on a prospect-by-prospect basis, following consideration of data quality, data spacing, continuity of mineralised domains, and confidence in the grade estimate.

Where appropriate, a coherent zone of mineralisation, located around the more densely sampled core, was assigned an Indicated classification. The extremities of each block model, that were supported by fewer data and were therefore less reliably informed, were classified as Inferred.

All prospects, except GM, were classified as Indicated and Inferred Mineral Resources. GM was classified as Inferred only, mainly due to the relatively low average RC drill recovery of 62%.

Due to the uncertain lateral extent and depth of artisanal mining at the Mikei prospects, and the lack of topographic data to accurately deplete the Mineral Resource, all oxidised material was classified as Inferred Mineral Resources.

The term "reasonable prospects for eventual economic extraction" (RPEEE) implies a realistic inventory of mineralisation which, under assumed and justifiable technical, economic and development conditions, might, in whole or in part, become economically extractable. The assumption is that the Mikei prospects will be extracted by open pit mining. The MGP block models were assessed for RPEEE by applying conceptual benchmarked costs to calculate reporting pit shells. The following conceptual parameters were applied for open pit mining:

·    Mining cost: US$3/tonne

·    Processing cost: US$22/tonne ore

·    Pit slope angle: 52°

·    Recovery: 90%

·    Royalty: 7%

·    Gold price: US$ 1,800/troy ounce.

The Mineral Resource is reported as that material within the RPEEE pit shells, and above a cut-off grade of 0.5 g/t Au. The Mineral Resource is reported as of 18 January 2021 (Table 1).

 

Table 1:   Mineral Resource for the Mikei prospects reported at a cut-off of 0.5 g/t Au, as of 18 January 2021

Area

Indicated

Inferred

Total

Tonnage (Mt)

Grade
(g/t Au)

Content (koz Au)

Tonnage (Mt)

Grade
(g/t Au)

Content (koz Au)

Tonnage (Mt)

Grade
(g/t Au)

Content (koz Au)

KKM

7.88

1.10

277.8

2.63

1.11

93.5

10.51

1.10

371.3

KW

0.61

1.10

21.6

0.32

1.42

14.7

0.93

1.21

36.3

NZ

1.04

3.96

132.0

0.32

3.17

32.2

1.35

3.78

164.1

GM

-

-

-

1.91

1.37

84.0

1.91

1.37

84.0

MK

0.28

5.48

49.0

0.15

3.83

18.2

0.43

4.91

67.1

Total

9.81

1.52

480.4

5.32

1.42

242.6

15.13

1.49

723.0

Note:

·    Computational errors may exist due to rounding.

 

For comparison, there follows the MRE reported in 2012 (Table 2):

 

Table 2:   Mineral Resource for the Mikei prospects reported at a cut-off of 0.5 g/t Au, as of December 2012

Area

Indicated

Inferred

Total

Tonnage (Mt)

Grade
(g/t Au)

Content (koz Au)

Tonnage (Mt)

Grade
(g/t Au)

Content (koz Au)

Tonnage (Mt)

Grade
(g/t Au)

Content (koz Au)

KKM

16.34

1.00

525.3

1.41

1.15

52.1

17.75

1.01

577.5

KW

1.13

1.07

38.9

3.03

1.02

99.4

4.16

1.04

138.2

NZ

1.17

3.73

140.3

1.15

1.70

62.9

2.32

2.72

203.2

GM

-

-

-

3.78

1.16

141.0

3.78

1.16

141.0

MK

0.77

4.05

100.3

0.58

1.76

32.8

1.35

3.07

133.1

Total

19.41

1.29

805.0

9.95

1.21

387.1

29.36

1.26

1,192.1

 

The 2021 Mineral Resource utilised the same block models that were used to report the 2012 Mineral Resource. No additional exploration data have been collected at the project since reporting the Mineral Resource in 2012, therefore the grade and density estimates are still valid as they are representative of the available data. Two criteria have been updated to report the 2021 Mineral Resource:

1)    Artisanal mining has continued at the Migori prospects since the 2012 Mineral Resource. A detailed topographic survey was not available, such that the block models could be depleted by the mining. Without more detailed information, the assumption is that all artisanal mining has taken place in the oxidised zone. For the 2021 Mineral Resource, all oxidised material that was previously classified as Indicated in 2012, has been downgraded to Inferred. This downgrade represents an 85% decrease in Indicated oxide tonnage, and an 83% decrease in Indicated oxide gold content, to the Inferred category.

2)    An industry recognised test for RPEEE was applied to the block models to report the 2021 Mineral Resource. The assumption is that Mineral Resources at the Migori prospects will be extracted by open pit mining. Conceptual mining costs were applied to calculate RPEEE pit shells in which the Mineral Resource was reported.

Recommendations

CSA Global has made the following recommendations for future work at the MGP:

·    Improvements in reliability of collar survey data for historical drilling.

·    Improvements in QAQC protocols and follow up of QAQC results to ensure accurate and precise assay data.

·    Improvements to geological logging such that a reliable geological model for the prospect can be constructed and oxide weathering profiles be developed.

·    High resolution topographic survey to obtain a more detailed DTM for the area, and to accurately deplete the Mineral Resource models. Any underground workings not surveyed by aerial means, need to be assessed with regards to impact on the Mineral Resource.

·    Additional bulk density determination is required, particularly in the oxide and transitionary zones to ensure robust tonnage estimates.

·    Further metallurgical testwork should be undertaken to better characterise material within weathering horizons and domains.

·    In order to improve the confidence (classification) of future MREs at Migori, infill drilling should be considered.

·    Targeted step-out drilling is recommended to potentially increase the size of the Mineral Resource. A preliminary drill plan was compiled to assist in future drill planning (Table 3).

 

Table 3:   Preliminary step-out drill plan

ID

X

Y

Z

Depth

Dip

Azimuth

CSA_001

646,990

9,888,148

1,277

290

0

60

CSA_002

647,106

9,888,156

1,279

50

0

60

CSA_003

646,933

9,888,370

1,287

50

0

60

CSA_004

646,919

9,888,340

1,286

80

0

60

CSA_005

644,908

9,889,000

1,252

80

0

60

CSA_006

644,951

9,889,041

1,250

70

0

60

CSA_007

644,924

9,889,035

1,250

60

0

60

CSA_008

644,330

9,889,379

1,220

90

0

50

CSA_009

644,227

9,889,472

1,214

30

0

55

CSA_010

644,874

9,889,540

1,240

80

0

60

CSA_011

644,815

9,889,758

1,241

60

0

50

CSA_012

641,060

9,890,936

1,162

85

0

60

CSA_013

641,076

9,890,970

1,163

85

0

60

CSA_014

640,847

9,891,078

1,165

50

0

60

 

 

 

 

Competent Person Statement

The information related to the estimation of Mineral Resources in this release has been compiled by Mr Anton Geldenhuys, MEng, PrSciNat, MGSSA, MGASA of CSA Global (UK) Ltd. He is a member of a recognised professional organisation and has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking, to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code) and as defined in the Guidance Note for Mining, Oil and Gas Companies published by AIM.

CSA Global (UK) Ltd has given and not withdrawn its consent to the release of the technical information in this announcement in the form and context in which it appears.

 

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

For further information, please contact:

Andrew Bell 0207 747 9990                                                                              Chairman Red Rock Resources Plc

Scott Kaintz 0207 747 9990                                                                               Director Red Rock Resources Plc

Roland Cornish/ Rosalind Hill Abrahams 0207 628 3396                            NOMAD Beaumont Cornish Limited

Mark Treharne 0203 700 2500                                                              Broker Pello Capital Limited

 

 

JORC Code, 2012 Edition - Table 1

Section 1: Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections)

Criteria

JORC Code explanation

Commentary

Sampling techniques

Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting the broad meaning of sampling.

Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used.

Aspects of the determination of mineralisation that are Material to the Public Report.

In cases where 'industry standard' work has been done this would be relatively simple (e.g. 'reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay'). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information.

Red Rock (2011 to 2012)

Diamond (DD) drillholes - core diameter of 47.6 mm (NQ) and the upper weathered and oxidised portions at 63.5 mm (HQ) and 85 mm (PQ), Core split in half using a diamond core saw along a marked centre line and half core sampled at 1 m lengths and submitted for assay.

Reverse circulation (RC) drilling - RC chips collected for every metre at drill pad. Rods flushed every 3 m on the completion of a run. Samples then dried and split using a 50:50 riffle splitter to produce 1, 2, 3 or 4 m composites depending on geology. Final samples submitted to the assay laboratory weighed approximately 500 g each.

Historical drilling

Auvista Minerals NL (Auvista) RC drilling - RC chips collected on site at 1 m intervals and initially composited to 4 m samples onsite; later in program the 1 m samples were taken to the camp prep-facility for compositing.

Kansai Mining Corporation Ltd (KMC) DD drilling - HQ and NQ diameter drill core split in half using a diamond core saw along a marked centre line. Half core sampled and submitted for assay.

Drilling techniques

Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc.) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc.).

Red Rock (2011 to 2012)

Diamond core diameter was 47.6 mm diameter (NQ) and shallow and oxidised upper portions drilled using 85 mm (PQ) and 63.5 mm (HQ) core diameters.

Drill core from Kakula-Kalange-Munyu (KKM), Kakula-Kalange-Munyu West (KW) and Nyanza (NZ) were orientated using a Reflex EZ-Trac™. None of the drilling at Gori Maria (GM) and MK were orientated.

Auvista (1994 to 2002)

Pre-1995 - RC drilling using Smith Capital 10R3H rig fitted with an Atlas Copco 750 cfm/400 psi compressor. Holes drilled with a 5" (125 mm) Halco face sampling hammer on a 4" (100 mm) RC rod string.

Post-1996 - Smith Capital 14R6H rig mounted on a Sammil 50 truck with an Atlas Copco 960 cfm/360 psi compressor and a 4" RC rod string. A second rig was purchased in March 1997 which was a modified and improved version of the first rig with additional air capacity (1920 cfm/720 psi).

KMC (2002 to 2009)

Boyles BB37 mobile/skid mounted drill rig with the capacity to drill HW (for hole portions requiring casing), HQ and NQ sized drill core. Five holes still had orientation marks visible - but method utilised is unknown.

The 592 drillholes used in the Mineral Resource estimate (MRE) comprised: diamond core drilling (26%), RC pre-collar and DD core tails (4%), RC drilling (70%).

Drill sample recovery

Method of recording and assessing core and chip sample recoveries and results assessed.

Measures taken to maximise sample recovery and ensure representative nature of the samples.

Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.

Red Rock (2011 to 2012)

DD recovery was recorded, and no issues reported. For the verification drilling, drillers made use of drilling fluids and shortened drill runs to maximise core recovery in areas of broken ground. In the upper weathered and oxidised parts of the drillholes, larger core diameters (HQ and PQ) were used.

RC recoveries were a concern in NZ due to downhole water that resulted in potential for contamination in the cyclone. In GM, poor recoveries were associated with poor driller experience and procedures and practices. GM average recovery was 62.3%. All other areas, RC recovery averaged 90%.

No relationship between recovery and grade, therefore no bias was observed.

Historical drilling

Recoveries for historical DD and RC drilling not recorded. No information is available regarding how recovery was maximised for the historical drilling. Any relationship between grade and recovery cannot be investigated for the historical data.

Logging

Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies.

Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography.

The total length and percentage of the relevant intersections logged.

Red Rock (2011 to 2012)

All RC holes were logged at the drill site by the supervising geologist. All DD core was logged at the Migori Camp. All logging was done using templates compiled by CSA Global (UK) Limited (CSA Global). Observations included colour, oxidation, texture, grain size, mineralisation, alteration, and lithology code. All geological logging was recorded on paper and then digitised.

37 of the Red Rock Resources Plc (Red Rock) DD holes and five of the KMC holes had orientated structures logged. In summary, there were five holes from KKM, 18 holes from KW and 14 holes from NZ.

Rock quality designation (RQD) data for cored drillholes was recorded.

Historical drilling

Auvista RC drilling - hard copy data was scanned and captured digitally by Red Rock. The same database library was used as for the Red Rock drilling.

No information on KMC logging was available.

Geotechnical logging was not undertaken.

It was not possible to define the nature of historical logging as qualitative or quantitative, nor was it possible to define the total length logged, as useful logging data was unavailable.

Subsampling techniques and sample preparation

If core, whether cut or sawn and whether quarter, half or all core taken.

If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry.

For all sample types, the nature, quality and appropriateness of the sample preparation technique.

Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples.

Measures taken to ensure that the sampling is representative of the in-situ material collected, including for instance results for field duplicate/second-half sampling.

Whether sample sizes are appropriate to the grain size of the material being sampled.

Red Rock

Drill core was sawn in half along a marked centre line using a DD core saw. Same half of the core was consistently sampled, and most samples submitted for assay were 1 m in length.

RC samples were dried and split using a 50:50 riffle splitter to produce 1 m, 2 m, 3 m or 4 m composites, depending on geology. Final samples submitted to the assay laboratory weighed approximately 500 g each.

All Red Rock samples were crushed on site and a split sent to ALS Mwanza where the samples were milled, and pulps then sent to ALS Johannesburg where they were assayed.

Auvista

Limited details available regarding how the samples were split and composited. The sample preparation was done at an onsite facility (purchased from Engineering and Sampling Systems, Australia in 1995) with a 10-12 sample per hour capacity. From 1996, samples were reduced to 170 g pulps before shipment. Samples were sent to Analabs Laboratories Pty Ltd (Western Australia) as noted from available assay certificates. No additional details on the sample preparation are available.

KMC

DD drilling - HQ and NQ diameter drill core split in half using a diamond core saw along a marked centre line. Half core sampled and submitted for assay, Sample preparation and analysis done at Humac Laboratories in Mwanza. Sample prep using P10 code included drying, jaw crushing to ‑6 mm and cone crushing to -2 mm, and riffle splitting to produce a 1 kg sample. Sand washing between samples was used where visible gold was noted to avoid contamination between high-grade gold samples.

Quality of assay data and laboratory tests

The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total.

For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc.

Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established.

Red Rock

Samples were prepared by ALS in Mwanza and assayed by ALS in Johannesburg. The assay methods were:

·    Au-AA26 (5 g fire assay with a AAS finish) for gold (range 0.01-100 ppm Au)

·    ME-OG62 (four-acid digest and AES finish) for silver, copper, lead, and zinc.

Auvista

The samples were analysed at Analabs in Western Australia in 1996 to 1997. The 4 m composites were sent for fire assay with aqua regia digest from a 30 g charge with an AAS finish. Samples >0.15 g/t Au had individual 1 m samples re-sent for fire assay from a 50 g charge with an AAS finish. Base metal geochemical data was obtained from pressed powder pellet XRF analyses.

KMC

Samples were analysed at Humac Laboratories between March 2001 and January 2010. A straight fire assay was used (gold four-method) on a 50 g sample with an AAS finish. High grade-samples were routinely checked at the laboratory with duplicate and sometimes triplicate assays. A set of screen fire assays were carried out on selected samples from the NZ prospect due to the common presence of visible and coarse gold.

Gold assays were recorded for drillholes only at Kakula, GM, NZ, and MK. At Macalder, both copper and silver assays were carried out in addition to gold using standard AA procedures (GAR Code). Assays were usually available within a week of delivery, allowing regular appraisal of the drilling program. Several drillholes required additional core splitting to complete assaying unsuspected mineralised intercepts.

QAQC protocols

Red Rock

Included insertion of:

·    Certified reference materials (CRM) sourced initially from Gannet Holdings in Perth and later made use of CRMs sourced from AMIS in Johannesburg.

·    Blank materials comprising non-certified alluvial sand, and later on, blank material sourced from AMIS.

The CRMs and blanks were inserted at a ratio of approximately 10 per 100 samples.

Duplicate samples comprising field duplicates prepared on site by crushing the half core and splitting the sample using a 50:50 riffle splitter. Inserted at a ratio of 1 per 20 samples.

Sample pulps were sent to Genalysis-Johannesburg (now part of the Intertek Group) the check laboratory. However, due to insufficient material only 44 of the 646 samples submitted could be assayed and results reported. These samples were analysed by a 50 g fire assay with an AA finish.

Overall, the quality of the results reported by ALS for the Red Rock drilling are considered sufficiently accurate and precise for use in the MRE.

 

Auvista

The samples were analysed at Analabs. Scant details were provided on the Auvista assay results. Procedures indicate that the following was implemented:

·    1 in 10 samples is a duplicate

·    1 in 20 samples is a triplicate

·    1 in 40 samples is a blank, alternating with a high-grade standard.

Blanks were barren granite and high-grade standard samples were made from a Kakula drill sample which was crushed and thoroughly mixed homogenised. The average grade was approximately 1.6 g/t Au. Triplicate samples were analysed independently by other labs.

The review of the Auvista QAQC results found:

·    Naming of CRMs (standards) and blanks was not always consistent. They were named "BLANK", "STD", "STDL", or "STDH". Two populations of standards ("STD1" and "STD2") and a blank were identified from these results.

·    Blank results were acceptable.

·    STD1 has an acceptable precision, STD2 has a poorer precision.

·    Duplicates and triplicates had an acceptable correlation, with some outliers at higher grades indicating that the gold mineralisation was nuggety.

·    No lab check results were available.

KMC and Santa Barbara QAQC

The QAQC results from the gold assays reported from March 2001 to January 2010. Samples were analysed at SGS and at Humac laboratories. In summary the following were noted:

·    Lab standards: Only a few results available, but no issues.

·    Blanks (client and lab): No issues.

·    Field duplicates: Poor correlation, but no significant bias.

Summary of QAQC samples per company/campaign

Company

QAQC category

Count of samples

% Total samples

% Original samples

Count of lab checks

% Lab checks

Red Rock

Samples

10,121

85.69%

100.00%

 

 

Duplicates

670

5.67%

6.62%

1551

13.13%

CRMs

1,020

8.64%

10.08%

909

7.70%

Umpires

44

 

0.43%

 

 

Total

11,811

100.00%

 

 

 

Auvista

Samples

14,761

91.55%

100.00%

 

 

Duplicates

1,000

6.20%

6.77%

0

0.00%

Triplicates

226

1.40%

1.53%

0

0.00%

CRMs

137

0.85%

0.93%

0

0.00%

Total

16,124

100.00%

 

 

 

KMC and Santa Barbara

Samples

8,034

99.46%

100.00%

 

 

Duplicates

26

0.32%

0.32%

0

0.00%

Triplicates

5

0.06%

0.06%

0

0.00%

CRMs

13

0.16%

0.16%

44

0.54%

Total

8,078

100.00%

 

 

 

Notes:

·   Samples refers to original samples for assay

·   Duplicates refers to field duplicate and lab pulp splits respectively

·   CRMs (standards) and blanks (client and lab respectively)

·   Umpires: Third party assays (not included in total no. of samples)

·   % Total Samples: Percent of total samples (including QAQC samples) submitted for each company

·   % Original samples: Percent of original samples (excluding QAQC samples) submitted for each company

·   % Lab Checks: Percent of total samples (including QAQC samples) submitted for each company

Verification of sampling and assaying

The verification of significant intersections by either independent or alternative company personnel.

The use of twinned holes.

Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.

Discuss any adjustment to assay data.

No independent verification sampling of the available historical drill core or RC chips, or Red Rock drill core or RC material was done by CSA Global.

As part of the verification process of the historical data, the following was done by Red Rock:

·    Red Rock drilled and sampled 111 infill holes at MK, KKM, KW, NZ, and GM. The geological and assay data collected in this exercise was compared with the historical data and found it correlated well with the historical data and thus supported their inclusion in the MRE. The infill drilling also served to decrease the hole spacing and improve confidence in the MRE.

·    Acquisition and collation of historical exploration data by Red Rock into a digital format.

·    Review of the historical databases and sample assay QAQC data (where available, was done).

·    Field confirmation of preserved drillhole collar positions and resurveying with a Trimble differential global positioning system (DGPS). Historical collars had previously used a local grid and subsequent transformations were unreliable.

·    Downhole survey camera shots were re-read and evaluated on a prospect-by-prospect basis.

·    Improved density data was collected.

·    Improved metallurgical data was collected.

·    An improved digital terrain model (DTM) was generated for the entire Migori area.

·    Where possible, historical assay data were checked against original lab certificates, downhole graphical logs, and digital data (stored as .csv files).

The attached report contains a thorough review of the work done to verify the historical data.

Where possible, the data was validated and captured with appropriate metadata, and all data was stored in a single database managed by CSA Global and Red Rock.

Location of data points

Accuracy and quality of surveys used to locate drillholes (collar and downhole surveys), trenches, mine workings and other locations used in Mineral Resource estimation.

Specification of the grid system used.

Quality and adequacy of topographic control.

The Red Rock drillholes were surveyed using a Trimble Pathfinder Pro-XRS differential DGPS receiver coupled with an L1 GPS/satellite differential antenna to collect coordinates and provided sub-metre level accuracy.

Grid system used: UTM36S-ARC1960.

Historical drillhole coordinates were in a local grid and were transformed by Red Rock. All preserved historical collars were surveyed by Red Rock (a total of 133 were located) and an affine transformation applied.

The topographic surfaces onto which the drillholes were draped comprised:

25 m x 25 m DTM for KW and NZ, surveyed using the onsite Trimble DGPS.

10 m x 10 m DTM was acquired for the rest of the area during the airborne geophysical survey in 2010 but has a less well constrained RL than the DGPS DTM.

Data spacing and distribution

Data spacing for reporting of Exploration Results.

Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied.

Whether sample compositing has been applied.

Drilling was done on a semi-regular grid over each of the deposits. Drillhole intersections are spaced at between 35 m and 50 m along-strike (and up to 100 m in places, often around the edge of individual deposits) and 30-50 m down-dip (in places the spacing may be closer at ±10-20 m).

The infill drilling program by Red Rock comprised:

Prospect

No. of holes

Metres drilled

KKM

31

3,425.05

KW

33

4,292.66

GM

17

1,808.03

MK

7

963.68

NZ

23

2,851.88

Total

111

13,341

In summary, the drilling used for the MRE comprised 592 drillholes:

Company

No. of holes

% total

Auvista

394

66.6

KMC

34

5.7

Red Rock

111

18.8

Santa Barbara

52

8.8

Unifario

1

0.2

Total

592

100

The drillhole spacing is acceptable to establish reasonable grade and geological continuity.

1 m composites were used for the estimation of gold grade.

Orientation of data in relation to geological structure

Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type.

If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.

The drillholes (Red Rock and historical) were drilled along lines orientated at an azimuth of ~025° which is orthogonal to the northwest-southeast strike of the deposits. Drillholes were inclined at -60°.

The drilling was orientated such that the mineralisation was intersected orthogonally so that the mineralised widths approximate true widths.

No material sampling bias was identified due to sample orientation.

Sample security

The measures taken to ensure sample security.

All drill samples were prepared at Red Rock's Mikei Camp which was permanently guarded and enclosed by a perimeter fence. All samples, once prepared, were then transported directly from the camp to the laboratory in Mwanza under supervision of a senior geologist.

ALS took responsibility for the sample security and transport once the samples arrived in Mwanza and all samples were accounted for.

Audits or reviews

The results of any audits or reviews of sampling techniques and data.

As part of the Mineral Resource estimation process, CSA Global undertook an extensive review of the historical data and associated protocols, the Red Rock data and protocols and a comparison of the various datasets to establish the validity and suitability of the data for inclusion into the MRE.

Section 2: Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section)

Criteria

JORC Code explanation

Commentary

Mineral tenement and land tenure status

Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.

The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.

The project area comprises two prospecting licences, PL/2018/0202 and PL/2018/0203 re-issued on 3 August 2020 under the Mining Act 2016 ("2016 Act"). They are valid for a period of three years from 3 August 2020 to 2 August 2023. The licences are held by Mid Migori Mining Company Limited (Mid Migori) and provides the holder the right to prospect for "Precious Metal Group of Minerals" which includes gold (Table 2).

The two licences were previously allocated as special prospecting licences (SPL122 and SPL202).

Red Rock holds a 100% interest in both licences through the agreements of 2015 and 2018 with Mid Migori.

No information on royalties etc., native title interests, historical sites and wilderness or national park settings were provided.

Exploration done by other parties

Acknowledgment and appraisal of exploration by other parties.

The MREs for the five prospects is heavily reliant on historical data. Approximately 81% of the holes used in the MRE were drilled by historical operators. In particular, Auvista data constitutes 67% of the holes in the current MRE.

Companies and related work completed by years:

·    1930s - Discovery of gold in the Migori District and small-scale mining by colonial individuals and companies through to the 1950s. Macalder and Nyanza mines continued producing copper and gold to the 1960s.

·    1940 to 1942 - RM Shackleton completed geological mapping at 1:125,000 scale which was published in 1946 by the Mining and Geological Department, Kenya Colony.

·    1959 to 1960 - Hunting Geophysics, McPhar Geophysics Ltd (AFMAG) and Lundberg Exploration Ltd undertook airborne electromagnetic and ground geophysical surveys.

·    1963 - Development at Nyanza mine by the operators of Macalder mine, including pitting, trenching, ground geophysics and diamond drilling.

·    1966 - Mining operations ceased at Macalder due to ore depletion.

·    1964 to 1969 - The UN Special Fund sponsored the BGS in a program of exploration for mainly base metals but also for gold. The BGS followed up geophysical anomalies and carried out geological mapping, surface geochemistry and limited DD drilling. No significant gold or base metal prospects delineated, some anomalies were left untested and only an incomplete record of this work is available in a report on copper in Kenya by L.D. Sanders in 1964.

·    1977 - Terra Surveys completed an INPUT airborne electromagnetic and magnetic survey over the central part of the Migori Greenstone Belt. Hard copy contour maps and electromagnetic anomaly plans were available. Survey data have since been digitally captured by Leeds University.

·    1979 to 1982 - UN Funds for Natural Resource Development sponsored consultant, R. Hutchinson, to review and re-interpret RM Shackleton's work on the regional geology. A brief geological summary is available from this work. The UN also commissioned Hunting Geophysics to re-interpret all the geophysical surveys in the area. Target areas were tested with ground geophysics (pulse electromagnetic, gravity and magnetics), geochemistry, trenching and 3,150 m diamond drilling.

·    1980 to 1986 - Unifario Ores Ltd (UOL) completed work on the Macalder tailings and NZ area. Work included trenching, bulk testing of alluvial material, limited shallow diamond drilling and estimation of Ore Reserves, but never proceeded into production.

·    1986 - Exploration Consultants International Ltd (ECI) (originally Unifario) contracted Michael Cotts International and Mackay and Schnellman to complete a prefeasibility study on the work completed by UOL. No reports relating to these studies were located and were not available for review, however they have been referred to by both Auvista (1988) and Tanganyika Gold Ltd (TGL) (Due Diligence, 1997).

·    1988 to 1994 - Migori Gold Mining Company (MGM), formerly ECI, signed a joint venture agreement with Santa Barbara (Kenya) Ltd (SBK). SBK funded approximately 5,000 m of diamond drilling in 39 holes at MK and GM. SBK engaged MSL to complete this work as well as MREs for MK. Following this, a stamp mill and cyanide recovery plant were installed in 1991. The project was hampered by numerous problems and only operated for a year. The North Queensland Company Ltd also conducted a data study on the projects in 1988 and concluded the projects were a worthy target but did not engage in any activities in Kenya.

·    1994 to 2002 - Auvista (a subsidiary of Panorama Resources NL) entered into a joint venture agreement with MGM to earn a 60% interest in Migori from an expenditure of US$2.2 million. Auvista spent approximately US$5 million from 1994 to 2001. Auvista completed extensive exploration soil sampling programs. Following positive soil geochemical results which focused on the KKM, GM, MK, and NZ targets, approximately 55,000 m of RC drilling was completed for over 600 holes at these lode gold prospects following which Mineral Resources were estimated in the 1990s. During this time, a regional mapping exercises was undertaken by consultant geologist, Jim Thornett over both tenements in 1996. From this exercise, four 1:25,000 scale solid and outcrop geology maps were produced covering the two licence areas. A detailed report also accompanied the maps and included a list of targets for exploration. These provided the focus for most of the work completed by Auvista from that time onwards.

·    1997 to 2002 - TGL completed a due diligence on these projects following which in 1998 TGL took over Panorama Resources NL and continued general exploration across the two licences.

·    In 2001 and 2002, TGL cited depreciation of gold prices as reason for lack of further investment at Migori.

·    2002 to 2009 - KMC acquired the projects from MGM in 2002. Data was apparently compiled into a digital format and additional re-assaying completed. An additional ±3,500 m of confirmatory DD holes were drilled at all prospects including some infill drilling in an attempt to tighten geological models and produce internal mineral estimates. These estimates were verified by D.A.S Hopkins of Ddraig Minerals Developments and publicly released in 2006 in an NI 43-101 Technical Report. Polygonal estimates with wireframes were used to calculate volumes at each locality.

·    2009 to present - Red Rock entered into a joint venture, purchase and sale agreement with KMC.

·    2011 - Red Rock completed an infill drill program, totalling 111 holes for 13,341 m at KKM, KW, MK, GM, and NZ.

·    2012 - Red Rock/CSA Global report an updated MRE for the Migori prospects.

Geology

Deposit type, geological setting and style of mineralisation.

The Migori Belt forms a small part of the Nyanza Greenstone Belt which is an extensive region of Archean greenstone rocks within the Tanzanian Craton located in northern Tanzania, western Kenya, and southeast Uganda. The Nyanza Greenstone Belt is divided into the Northern and Southern Terrains. The Southern Terrain is predominantly a volcaniclastic suite (Nyanzian Group) and associated intrusives while the Northern Terrain is dominated by the marine metasediments of the Kavirondian Group.

The host rocks within the tenements comprise predominately intermediate to felsic volcanics and associated volcaniclastics, inter-bedded with subordinate basaltic to andesitic lavas and siliciclastic interflow sediments. Generally, the igneous suite is dominated by intermediate andesites and rhyolites with an abundance of crystal tuffs, however Nyanza is dominated by metabasalts. Intercalated with these metavolcanics are metasediments including greywackes and graphitic shales. Banded Iron formation also occurs throughout the volcano sedimentary pile and regionally exploration results appear to highlight these as future targets for gold exploration.

Two main deposit types are recognised in the area:

·    Volcanogenic massive sulphide (VMS) ascribed to the historical Macalder Mine.

·    Orogenic (lode) gold prospects ascribed to the KKM, KW, GM, NZ, and MK prospects and also includes those in the Lake Victoria Greenstone Belt in northwest Tanzania (to the south of the Nynaza Belt) including North Mara (Barrick Gold), Golden Pride (Resolute) and Geita (AngloGold Ashanti).

Lode gold

The Migori belt is host to numerous quartz vein hosted gold occurrences, which are exploited by artisanal miners (KKM, KW, GM, NZ, and MK). These lodes occur as structurally controlled quartz stockworks and veins within shear zones. For most prospects, gold mineralisation is close to surface.

Gold mineralisation is associated with emplacement of quartz vein and porphyry intrusions resulting from granitic intrusions. This is associated chlorite, sericite and carbonate alteration assemblages along with silicification which increases within the shear zone, particularly along mineralised zones where quartz flooding and blue-grey sulphidic quartz stockworks are associated with maximum gold grades. Accessory sulphide assemblages often accompany mineralisation, however barren assemblages also host sulphides. Pyrite is the most widespread, with pyrrhotite also common and minor arsenopyrite.

Each of the five prospects (KKM, KW, MK, GM, NZ) form individual mineralised domains that are located within the main shear zone which has a strike length of over 7.5 km northwest-southeast, with KKM located roughly at its centre. This shear zone forms a large magnetic low of the same orientation. Between KKM and GM a pervasive north-northwest trending kilometre-scale transverse fault (with apparent dextral movement) is visible in the magnetic imagery along which the Macalder VMS deposit is located.

Most lode gold mineralisation occurs within the shear zone, in close proximity to the granite-greenstone contact. The lodes occur as structurally controlled quartz stockworks and veins within sheared zones that range between 1 m and 30 m in thickness. These stockwork or vein systems will often have a plunge along steeply dipping shear planes and are generally discontinuous. Structural studies completed by Olang (20123) have identified two dominant fault systems; a north-northwest to south-southeast dextral strike slip system with a northeast-southwest conjugating set. En-echelon conjugate sets are common for shear zone systems and could account for the high number of near horizontal down hole orientated structures.

Generally, lodes are inconsistent in grade and can be discontinuous between 50 m sections (this is particularly the case for NZ). However, majority of the core mineralisation is typically continuous along a central portion of each prospect. Maximum grades are associated with quartz vein stockworks and/or lithological contacts such as between quartz-eye porphyries and graphitic shales.

Drillhole information

A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drillholes:

·    easting and northing of the drillhole collar

·    elevation or RL (Reduced Level - elevation above sea level in metres) of the drillhole collar

·    dip and azimuth of the hole

·    down hole length and interception depth

·    hole length.

If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case.

Exploration results not being reported.

The relative location of the Red Rock drillholes (RC and DD) are presented Figure 21 (Section 6.1).

Data aggregation methods

In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (e.g. cutting of high grades) and cut-off grades are usually Material and should be stated.

Where aggregate intercepts incorporate short lengths of high-grade results and longer lengths of low-grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail.

The assumptions used for any reporting of metal equivalent values should be clearly stated.

Exploration results are not being reported as part of this work. No data aggregation has been used to report Exploration Results.

No metal equivalents have been applied.

Relationship between mineralisation widths and intercept lengths

These relationships are particularly important in the reporting of Exploration Results.

If the geometry of the mineralisation with respect to the drillhole angle is known, its nature should be reported.

If it is not known and only the downhole lengths are reported, there should be a clear statement to this effect (e.g. 'downhole length, true width not known').

The drilling was orientated such that the mineralisation was intersected orthogonally so that the mineralised widths approximate true widths.

The drillholes (Red Rock and historical) were drilled along lines orientated at an azimuth of ~025° which is orthogonal to the northwest-southeast strike of the deposits. Drillholes were inclined at -60°.

Diagrams

Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drillhole collar locations and appropriate sectional views.

Relevant figures are provided in this report.

Balanced reporting

Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.

No reporting of Exploration Results.

Other substantive exploration data

Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples - size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances.

No other exploration data to report.

Further work

The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step-out drilling).

Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.

Additional work proposed includes:

·    Strategic Mineral Resource definition from infill and geostatistical drilling, including areas identified outside the RPEEE pit shell which should be drilled and included into future updates of the RPEEE pit shells

·    Additional twinning of historical holes in the central zones of each deposit

·    Metallurgical testwork to better characterise the weathered and fresh domains

·    Re-survey collar positions of all historical holes to improve reliability

·    Improvements to the geological logging to better define the oxide and fresh domains

·    Improvements on the QAQC protocols

·    More detailed topographical survey, this should include the surface artisanal workings

·    Volumetric surveys of the underground historic workings for Mineral Resource depletion

·    Additional bulk density sampling of all material, particularly from the oxide and transition zones

 

 

 

Section 3: Estimation and Reporting of Mineral Resources

(Criteria listed in section 1, and where relevant in section 2, also apply to this section)

Criteria

JORC Code explanation

Commentary

Database integrity

Measures taken to ensure that data has not been corrupted by, for example, transcription or keying errors, between its initial collection and its use for Mineral Resource estimation purposes.

Data validation procedures used.

The integrity of the database was tested by means of importing the data into Micromine and examining statistics and histograms of variables. Any transcription errors entered into the digital database from hardcopy logs or certificates, would show up either as an importing issue into Micromine (identifies any overlaps or gaps in data), or in the statistics and histograms of grade values (in the form of unexpected values).

It is evident from analysis of the QAQC data, that some CRMs and blanks were mislabelled. These were however identified.

Site visits

Comment on any site visits undertaken by the Competent Person and the outcome of those visits.

If no site visits have been undertaken indicate why this is the case.

A four-day site visit was completed as part of CSA Global's initial review by Andrew Chubb (Senior Geologist, CSA Global who has since left the employ of CSA Global) from 11 August 2009, along with Joe Crummy (Consulting Geologist) and Mike Nott (Director, Red Rock Resources). In September 2011, a second site visit by Thomas Branch (Geologist, CSA Global who has since left the employ of CSA Global) was completed to gain an understanding of the drill logging and sampling methodologies of Red Rock's infill drill program.

No site visit has been undertaken by the Competent Person as part of the 2021 MRE; however, there is no material new data since reporting the 2012 MRE, and the Competent Person is satisfied to rely on the previous site visits as both Andrew Chubb and Thomas Branch are known to CSA Global and were trusted employees at the time of the employment.

Geological interpretation

Confidence in (or conversely, the uncertainty of) the geological interpretation of the mineral deposit.

Nature of the data used and of any assumptions made.

The effect, if any, of alternative interpretations on Mineral Resource estimation.

The use of geology in guiding and controlling Mineral Resource estimation.

The factors affecting continuity both of grade and geology.

Geological logging and assay data was used in the interpretation of the geological model. Red Rock provided cross sections of interpreted geology and mineralisation to CSA Global, which formed the basis of the 2D sectional interpretation undertaken in Micromine.

Red Rock geologists generated a suite of individual wireframes to model the oxidation surfaces for each prospect. These were created in section view, using strings that were snapped to drillhole traces. Weathering and oxidation details for boreholes were taken from Red Rock logging data as well as a relatively well organised Microsoft Excel database compiled by Auvista from their drillholes. These two datasets were combined and formed the basis of Red Rock's interpretation. These were supplied to CSA Global and were used to code all blocks below the topography.

CSA Global calculated potential mining composites in Datamine (using the COMPSE process). Composites had a minimum width of 3 m, allowing for a maximum 2 m of internal waste. The composites were produced at a range of lower cut-off grades from 0.1 g/t Au to 2.0 g/t Au.

A statistical review was undertaken of the composites produced at each lower cut-off grade. They were reviewed by relative volume, % dilution, % ore lost and ore grade. It was decided that the 0.25 g/t Au composites would best define the boundary between background gold and potentially economic gold. This was supported by a preliminary sectional assessment of the composites using Micromine.

The 0.25 g/t Au threshold was used as the boundary for mineralisation, with the 0.5 and 1 g/t Au composites being used to guide the mineralised interpretation, so that higher grade zones were linked down-dip and along-strike, according to the current geological and mineralisation model prepared by Red Rock.

Surveyed artisanal surface workings were used to guide the extension of mineralised zones at surface and along strike, where appropriate.

Mineralised domains for each of the five deposits were extended halfway between drillholes at the termination of mineralisation, in both dip and strike planes.

KKM consists of 17 broadly continuous (between 200 m and 800 m strike length) zones which dip steeply to the southwest.

KW and NZ consist of steeply dipping units, striking southeast-northwest dipping steeply to the southwest.

GM demonstrates a similar strike orientation but consisted of two groups of domains which differ in dip. One set was steeply dipping to the southwest, the other shallow dipping to the southwest.

Domain 1 at MK was modelled from a thin unit of mineralised quartz porphyry. This unit has been highly brecciated and contains disseminated sulphide mineralisation. It is continuous along strike and down dip. Other domains were based upon quartz veining and sulphide mineralisation and are less continuous along-strike and down-dip.

A reasonable amount of confidence can be placed in the geological interpretation.

CSA Global is not aware of any alternative interpretations.

Drilling data shows reasonable grade and geological continuity along strike and down dip.

Dimensions

The extent and variability of the Mineral Resource expressed as length (along strike or otherwise), plan width, and depth below surface to the upper and lower limits of the Mineral Resource.

The KKM mineralisation is 2,110 m along-strike, 270 m deep with lodes occurring across a 320 m wide zone, with the widest continuous zone being approximately 80 m in width. The Mineral Resource reported in the RPEEE pit shell is 1,770 m along-strike, 190 m deep and spans a 270 m wide zone.

The MK mineralisation is 830 m along-strike, 120 m deep with lodes occurring across a 200 m wide zone, with the widest continuous zone being approximately 10 m in width. The Mineral Resource reported in the RPEEE pit shell is 830 m along-strike in several pits, 100 m deep and spans a 40 m wide zone.

The KW mineralisation is 800 m along-strike, 180 m deep with lodes occurring across a 450 m wide zone, with the widest continuous zone being approximately 15 m in width. The majority of the Mineral Resource reported in the RPEEE pit shell is 450 m along-strike in several pits, 100 m deep and spans a 60 m wide zone.

The NZ mineralisation is 680 m along-strike, 200 m deep with lodes occurring across a 210 m wide zone, with the widest continuous zone being approximately 20 m in width. The Mineral Resource reported in the RPEEE pit shell is 350 m along-strike, 140 m deep and spans a 200 m wide zone.

The GM mineralisation is 670 m along-strike, 210 m deep with lodes occurring across a 240 m wide zone, with the widest continuous zone being approximately 35 m in width. The Mineral Resource reported in the RPEEE pit shell is 430 m along-strike, 180 m deep and spans a 140 m wide zone.

Estimation and modelling techniques

The nature and appropriateness of the estimation technique(s) applied and key assumptions, including treatment of extreme grade values, domaining, interpolation parameters and maximum distance of extrapolation from data points. If a computer assisted estimation method was chosen include a description of computer software and parameters used.

The availability of check estimates, previous estimates and/or mine production records and whether the Mineral Resource estimate takes appropriate account of such data.

The assumptions made regarding recovery of by-products.

Estimation of deleterious elements or other non-grade variables of economic significance (e.g. sulphur for acid mine drainage characterisation).

In the case of block model interpolation, the block size in relation to the average sample spacing and the search employed.

Any assumptions behind modelling of selective mining units.

Any assumptions about correlation between variables.

Description of how the geological interpretation was used to control the resource estimates.

 

Discussion of basis for using or not using grade cutting or capping.

The process of validation, the checking process used, the comparison of model data to drillhole data, and use of reconciliation data if available.

The geological modelling and estimation were done in Micromine.

Domain wireframes created in the geological interpretation were used to code drillhole assays. All assays that were located within the domain wireframes were assigned the appropriate domain code. Data outside the domain wireframes were removed from the dataset for the purposes of grade estimation.

Data was separated into the five prospects and the classical statistics for each prospect were reviewed. All prospects demonstrated log normal populations for gold. KKM, KW and GM were comprised of a low-grade population (representing an acceptable amount of internal waste), a medium-grade population (representing the main mineralisation) and a small higher-grade population. NZ and MK had similar low and medium-grade populations, but had larger high-grade populations, which had been honoured in specific domains.

Prior to undertaking the grade estimation, all grade data was composited to a uniform interval length. This was done to prevent potential grade bias in the estimations, from very long or short intervals. The selected composite interval was 1 m, being the most common sample length for each prospect. Composites were defined downhole, with domain boundaries used as a constraint. Mean grades of composited and raw data were compared, no evidence of grade bias was observed due to compositing in KKM, KW, NZ, and GM.

A review of composited data histograms for each domain suggested that the composite grade populations were positively skewed and showed a broad range of gold grades, including some extreme high-grade values (outliers). The requirement to top cut was informed by considering the coefficient of variation (COV) of gold at each prospect. All prospects had a COV greater than 1 (i.e a large spread of grades). Top cuts were selected following a review of the gold histogram tail disintegration. A review and consideration of the percentage of metal cut, percentage of data cut and the resulting mean grade, ensured that the top cut applied was not overly severe. Data from the prospects, with the exception of MK were top cut. KW, GM, and NZ had top cuts applied to all domain data. KKM had a different top cut applied to Domain 11, as it contained a higher grade population relative to other domains. No top cut was applied to MK prospect, due to the effect of compositing on the dataset. This essentially reduced the influence of high-grade outliers prior to any compositing step that would have been undertaken.

Separate block models were constructed for each prospect using 25 m x 10 m x 10 m (E x N x RL) blocks. The parent block size was chosen to honour current data spacing and to be a multiple of potential selective mining unit (SMU) size. Sub cells were used to honour mineralisation wireframe boundaries, although estimation was into the larger parent cells.

Variography was undertaken for each prospect. Upon completion of domain variography, the resulting variogram models were cross validated to assess their reliability. This validation step was performed in Micromine.

No assaying of deleterious elements was done; therefore, it is not possible to estimate these. Some amount of sulphide should be expected, and acid mine drainage studies should be undertaken as part of future work.

Validation of each estimate was undertaken to ensure that the grade and tonnage estimates adequately honour the input data, and that no significant or material bias in grade or tonnage is introduced as a result of the estimation process.

The following validations were undertaken for each prospect:

·    Global - A comparison of global input gold mean grade vs global output gold mean grade, for each prospect. On the whole output block model mean grades honoured the average input mean grades.

·    Local - A review of mean input grade and mean output grade was undertaken on a domain-by-domain basis, for each prospect. Smaller domains, where resource volumes are relatively poorly informed by sample data, exhibit less correlation than those that are better informed. The main, more continuous domains, which account for majority of the volume, have block model grades that honour the input grades used in estimation.

·    Sectional review - Block models for all areas were reviewed in 2D sections, so that block grade and composite grade could be compared visually to ensure that spatially, high-grade blocks correlate with high-grade composite data, and vice versa.

·    Swath plots - Swath plots were prepared for each prospect. Composite data and block data were displayed graphically by eastings, northings and RL slices and compared. The block model grade distribution honoured the distribution of input composite grades throughout each model, with the acceptance of some grade smoothing which was expected when interpolating grade into blocks from discrete samples.

 

 

 

 

 

 

 

 

 

 

 

 

 

Moisture

Whether the tonnages are estimated on a dry basis or with natural moisture, and the method of determination of the moisture content.

Tonnages were estimated dry and dry bulk density was used for the estimation of tonnages. No information on moisture content was available.

Cut-off parameters

The basis of the adopted cut-off grade(s) or quality parameters applied.

A 0.5 g/t Au cut-off was applied for the reporting of Mineral Resources. The cut-off is in line with other similar, shallow gold deposits.

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 expected method of extraction would be by open pit mining. To demonstrate reasonable prospects for eventual economic extraction, conceptual pit shells were generated in Whittle software using the following parameters:

·    Mining cost: US$3/t

·    Processing cost: US$22/t ore

·    Pit slope angle: 52°

·    Recovery: 90%

·    Royalty: 7%.

Mineral Resources were reported for mineralisation within these pit shells for each prospect.

 

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.

Red Rock undertook metallurgical test work for all prospects at the Migori Project during 2012. Samples were sent to Wardell Armstrong Mineral Processing Laboratories (Wardell), based in Cornwall in the UK.

The results from all samples tested from NZ, KKM and KKM west, indicate a positive response to gold recovery by cyanide leaching, with further work is required to establish the variable recovery trend evident in the variability drill-core samples.

The test work results on the MK samples clearly demonstrate that the mineralisation is amenable to gold recovery by a modest grind size followed by a cyanide leach in a mild strength cyanide solution at low lime consumption.

The results from of the samples tested from GM suggest a positive response to gold recovery by cyanide leaching for the oxide material, but low recoveries from the fresh material. The low recoveries from the fresh material requires additional test work to establish the reason for this and a possible process treatment route for additional recovery.

It appears most of the gold lost to tailings is associated with sulphide mineralisation. The sulphide content of each prospect, and the ratio of gold to sulphur in the individual samples should be evaluated in the next phase of work.

The grind testwork appears to show that the high-grade composites were much harder and required more power input than the low-grade samples. This is contrary to expectations and will be reviewed during the next phase of test work. Usually, oxide samples show a lower power input than for fresh material.

As testwork was only conducted on a single composite of each style of mineralisation for each deposit, the results should be considered indicative that the material is amenable to processing using conventional extraction methods. More testwork is required established a detailed processing flowsheet.

Environmental factors or assumptions

Assumptions made regarding possible waste and process residue disposal options. It is always necessary as part of the process of determining RPEEE 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.

No environmental factors or assumptions were considered for the MRE.

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.

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.

Discuss assumptions for bulk density estimates used in the evaluation process of the different materials.

Density determinations were done across the project using the Archimedes method on drill core samples for oxide, transitional and fresh material.

Density data available by oxidation state and prospect:

Material type

KW

GM

MK

NZ

Oxide

22

9

3

9

Transitional

37

19

5

34

Fresh

160

64

116

146

The bulk density results were separated into prospect and material type. Mean density values for each group were reviewed; the following observations were made:

Data populations for oxide and transitional material were low, resulting in lower confidence in the densities of these materials.

·    Oxide material had a lower density than transitional and fresh material.

·    Transitional material had a density that was similar to the fresh material.

KW, MK, and GM material had very similar density distributions and mean density values for fresh material, KW and GM had similar densities for all material types. Due to the small data populations available at MK for oxide and transitional material, and the similarities in the density of fresh material, the values for oxide and transitional material for KW and GM were applied to MK.

NZ had a different density distribution and slightly higher mean density, which has been attributed to the increased presence of basalt in the stratigraphic package.

Further bulk density testing is required to increase understanding of the bulk density variability between oxidations states, geological units, and mineralisation styles.

Bulk density is expressed as dry density. The density values are deemed reasonable for the type of material under consideration.

Bulk density values as assigned to the block models:

Material type

KW, GM and MK

NZ

KKM

Oxide

2.40

2.40

2.50

Transitional

2.75

2.90

2.72

Fresh

2.75

2.90

2.72

 

Classification

The basis for the classification of the Mineral Resources into varying confidence categories.

Whether appropriate account has been taken of all relevant factors (i.e. 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).

Whether the result appropriately reflects the Competent Person's view of the deposit.

Classification was reviewed on a prospect-by-prospect basis, taking the following points into consideration:

·    Data quality

·    Data spacing

·    The geological model

·    The continuity of mineralised domains, along-strike and down-dip

·    The confidence in the grade estimate through consideration of kriging variance, (informed by the number of holes and samples used to estimate blocks) and the distances between data points and block centroid locations used to estimate grade for each block.

These considerations are all informed by the search pass (run) from which blocks were estimated. The lower the run, the better supported the estimated grade. The validation of the estimates by means of comparing statistics, visual comparison of composite grades vs block grades and swath plots also inform the confidence in the estimate.

The classification reflects the Competent Person's view of the deposit.

Audits or reviews

The results of any audits or reviews of Mineral Resource estimates.

CSA Global reviewed the data supplied by Red Rock which was used for the MRE. The Competent Person reviewed the 2012 Mineral Resources which were used as the basis for the 2021 Mineral Resource.

Discussion of relative accuracy/ confidence

Where appropriate a statement of the relative accuracy and confidence level in the MRE 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 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.

These statements of relative accuracy and confidence of the estimate should be compared with production data, where available.

The estimated block model was classified to reflect the confidence in the Mineral Resource. Areas classified as Indicated have a reasonable level of confidence with regards to local estimates. Areas classified as Inferred are considered global estimates.

 

 

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