Thor Mining PLC (LON:THR)

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Thor Mining PLC RNS Release

Pilot Mountain Increased Mineral Resource Estimate


RNS Number : 3667K
Thor Mining PLC
13 December 2018
 

13 December 2018

 

THOR MINING PLC

INCREASED MINERAL RESOURCE ESTIMATE - PILOT MOUNTAIN NEVADA USA

 

The Board of Thor Mining Plc ("Thor" or the "Company") (AIM, ASX: THR), is pleased to announce an upgraded and increased mineral resource estimate containing tungsten, copper and now zinc, for the Desert Scheelite deposit at Pilot Mountain in Nevada USA.

 

Highlights:

 

·     The Desert Scheelite mineral resource estimate now comprises 10.7 million tonnes at 0.26% WO₃, 19.38 gram/tonne Silver (Ag), 0.15% copper (Cu), & 0.38% zinc (Zn) (above cut-off grade of 0.15% WO3) (Refer to Table A below);

·     The upgraded mineral resource estimate represents a 6.5% increase in the scheelite inventory for Desert Scheelite, now containing 27,700 tonnes of WO₃ (tungsten trioxide) 85% of which is in the Indicated category;

·     For the first time, the estimate includes zinc in the resource inventory, contributing an additional potential by-product stream to the project;

·     The planned flotation recovery process, currently being trialled, is likely to recover zinc sulphides into concentrate with minimal additional cost;

·     The resource inventory still has considerable growth potential via the Gun Metal and Good Hope deposits, as well as further potential upside at both Desert Scheelite and Garnet;

 

 

Mr Mick Billing, Executive Chairman, commented:

"This addition to the resource estimate at Pilot Mountain further enhances the potential of this exciting project."

 "Pilot Mountain hosts a large and, in the directors' view, valuable tungsten resource in the USA, where there has been no primary production of tungsten for some years, despite being classified as a critical mineral by the US Department of the Interior."

"I look forward to outlining the next steps for this key Company project in the coming weeks. This update will complement comprehensive updates across all areas of our operations in what is a highly proactive period for Thor."

"In this regard I also expect to provide updates to the market in respect of Molyhil commercialisation, the Bonya project review exercise (including vanadium) and the latest developments in respect of the Company's Kapunda copper project interest."  

 

 

 

Pilot Mountain Resource Summary

 

Table A: Pilot Mountain Resource Summary 2018 (JORC 2012) - 100% owned by Thor Mining Plc

 

Resource   

WO3

Ag

Cu

Zn

 

 

MT

Grade

%

Contained metal (t)

Grade

g/t

Contained metal (t)

Grade

%

Contained metal (t)

Grade

%

Contained metal (t)

Garnet

Indicated

 

-

-

 

 

 

 

 

 

Inferred

1.83

0.36

6,590

 

 

 

 

 

 

 

Sub Total

1.83

0.36

6,590

 

 

 

 

 

 

Desert Scheelite

Indicated

9.01

0.26

23,400

20.73

187

0.15

13,200

0.41

37,100

Inferred

1.69

0.25

4,300

12.24

21

0.16

2,800

0.19

3,200

 

Sub Total

10.70

0.26

27,700

19.38

207

0.15

16,000

0.38

40,300

Summary

Indicated

9.01

0.26

23,400

 

 

 

 

 

 

Inferred

3.53

0.31

10,890

 

 

 

 

 

 

Pilot Mountain Total

12.53

0.27

34,290

 

 

 

 

 

 

                       

 

Note:

·  All figures are rounded to reflect appropriate levels of confidence.  Apparent differences may occur due to rounding

·  Cut-off grade 0.15% WO₃

·  Garnet deposit resource reported 22 May 2017.  The Company is not aware of any information or data which would materially affect this previously announced resource estimate, and all assumptions and technical parameters relevant to the estimate remain unchanged.

 

Zinc Exploration Target

 

Zinc and copper are also present at the other three Pilot Mountain deposits; Garnet, Good Hope and Gun Metal however zinc data are not included in the historic database and the 2017 drilling zinc data alone are insufficient to estimate an inferred zinc resource.

On the basis of the 2017 drill data, an exploration target* for the Garnet deposit is estimated as;

1-4 - 1.8 Mt at 0.5 to 1.0% Zinc

(7,000 - 18,000 tonnes contained Zn metal)

Further opportunities for the growth of the Garnet resource are being evaluated for follow up drilling.

*Exploration Targets are conceptual in nature and there is insufficient data to define a Mineral Resource under the JORC Code. It is uncertain if further exploration will result in the determination of a Mineral Resource.

 

Summary of Resource Estimate and Reporting Criteria 

The work is an update of the resource completed by Golder Associates in 2012. The 2018 resource update was undertaken by Resource Evaluation Services (RES)

Drilling of the Desert Scheelite deposit has been conducted in campaigns since 1972, with the most recent drilling completed in 2017.  The update to the resource includes four new diamond drill holes completed by Thor and seven additional drill holes added to the database from historical sources.

The drill hole database used for the Desert Scheelite resource estimation was provided to RES as the MS Access database ds_drillhole_database.mdb.  The referential integrity of the supplied database was confirmed, and the database validated against the 2012 resource database.  Adjustments to the database were made by RES correcting the imperial to metric conversion and standardising the database to millimetre precision.

The Vulcan ISIS database ds112018.geo.isis was created by RES for the update.  The resource model update is based on 99 drill holes for a total of 18645 m, spaning 750 m east to west and 300 m in a north to south.

Most of the modelling data from the Golder 2012 model was available to RES including the topographic and mineralisation models.

The mineralisation wireframe models were adjusted to account for the additional drilling. The mineralised skarns were separated into several domains representing structural and geological differences.  The Desert Scheelite deposit has been modelled as several sub-vertical lenses.  The Desert Scheelite deposit trends dominantly east-west and dips variably 70-80º.

The mineralised skarns have been modelled using a 0.1% WO3 cut-off and geological logs when available.  The quartz monzonite, tertiary volcanics, metaclastites, hornfels and Top of Fresh Rock have been interpreted using the logged stratigraphy codes.  The mineralised zones were used to define spatial regions for statistical and geostatistical analysis.

For statistical data analysis, exploration data was composited to 1.52 m (5 ft) downhole lengths.  Imprecise imperial to metric conversion factors resulted in a significant proportion of short composites.  To mitigate this issue length weighted raw samples were used in the final analysis and estimation.

Analysis was based on four assay variables: WO3, Ag, Cu and Zn.  The composites were flagged to the geological interpretations and statistical analysis performed by domain.

Downhole and directional grade variography was completed for all domains to provide parameters for the Ordinary Kriging method used for resource estimation.  The spherical scheme model was used to obtain all variogram parameters from the experimental variograms.  The modelled variograms have directions consistent with the orientations of the lodes and exhibit a low angle plunge in the main skarn.

Four estimation passes using increasing search distances were employed to interpolate all the blocks within the skarn and waste domains.  The fourth pass was used to establish inferred resource down dip of the deposit by increasing the search ellipse size in the down dip direction.

Density values were applied to model based on the Golder 2012 work.

 

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

 

Enquiries:

Mick Billing

+61 (8) 7324 1935

Thor Mining PLC

Executive Chairman

Ray Ridge

+61 (8) 7324 1935

Thor Mining PLC

CFO/Company

Secretary

Colin Aaronson/

Richard Tonthat/ Ben Roberts

+44 (0) 207 383 5100

 

Grant Thornton UK LLP

 

Nominated Adviser

Nick Emerson

+44 (0) 1483 413 500

SI Capital Ltd

Joint Broker

David Hignell / Rob Rees

+44 (0)20 3861 6625 

Northland Capital Partners Limited

Joint Broker

Tim Blythe/ Camilla Horsfall

+44 (0) 207 138 3222

Blytheweigh

Financial PR

 

Updates on the Company's activities are regularly posted on Thor's website www.thormining.com, which includes a facility to register to receive these updates by email, and on the Company's twitter page @ThorMining.

 

Competent Person's Report

 

The information in this report  that relates to the Desert Scheelite and Garnet JORC Resource Estimates is based on information compiled by Mr. Stephen Godfrey, who is a Member of the Australian Institute of Geoscientists and Australasian Institute of Mining & Metallurgy and  who has had sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activities which are being  undertaken  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' . Mr. Godfrey is an employee of Resource Evaluation Services and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

 

The information in this report that relates to exploration results and exploration targets is based on information compiled by Richard Bradey, who holds a BSc in applied geology and an MSc in natural resource management and who is a Member of The Australasian Institute of Mining and Metallurgy.  Mr Bradey is an employee of Thor Mining PLC.  He has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which 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'.  Richard Bradey consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

 

About Pilot Mountain

Thor's Pilot Mountain Project, acquired in 2014, is located approximately 200 kilometres south of the city of Reno and 20 kilometres east of the town of Mina located on US Highway 95.

The Pilot Mountain Project comprises four tungsten deposits: Desert Scheelite, Gunmetal, Garnet and Good Hope.  All are in close proximity (~three kilometres) to each other and have been subjected to small-scale mining activities at various times during the 20th century. 

Union Carbide acquired the project in 1978, for US$7.0 million (estimated at US$26million - US$40million in 2017 dollars), and conducted detailed exploration and feasibility activities until, following a global downturn in the tungsten industry in the 1980s, they suspended further work.

 

About Thor Mining PLC

Thor Mining PLC (AIM, ASX: THR) is a resources company quoted on the AIM Market of the London Stock Exchange and on ASX in Australia.

Thor holds 100% of the advanced Molyhil tungsten project in the Northern Territory of Australia, for which an updated feasibility study in August 2018¹ suggested attractive returns.

Thor also holds 100% of the Pilot Mountain tungsten project in Nevada USA which has a JORC 2012 Indicated and Inferred Resources Estimate² on 2 of the 4 known deposits.  The US Department of the Interior has confirmed that tungsten, the primary resource mineral at Pilot Mountain, has been included in the final list of Critical Minerals 2018.

Thor is also acquiring up to a 60% interest Australian copper development company Environmental Copper Recovery SA Pty Ltd, which in turn holds rights to earn up to a 75% interest in the mineral rights and claims over the resource³ on the portion of the historic Kapunda copper mine in South Australia recoverable by way of in situ recovery. 

Thor has an interest in Hawkstone Mining Limited, an Australian ASX listed company with a 100% Interest in a Lithium project in Arizona, USA.

Finally, Thor also holds a production royalty entitlement from the Spring Hill Gold project⁴ of:

 

 A$6 per ounce of gold produced from the Spring Hill tenements where the gold produced is sold for up to A$1,500 per ounce; and

 A$14 per ounce of gold produced from the Spring Hill tenements where the gold produced is sold for amounts over A$1,500 per ounce.

 

Notes

¹ Refer ASX and AIM announcement of 23 August 2018

² Refer AIM announcement of 22 May 2017 and ASX announcement of 23 May 2017

³ Refer AIM announcement of 10 February 2016 and ASX announcement of 12 February 2018

 Refer AIM announcement of 26 February 2016 and ASX announcement of 29 February 2017

 

 

Compliance with the JORC Code Assessment Criteria

The JORC Code (2012) describes a number of criteria, which must be addressed in the documentation of Mineral Resource estimates, prior to public release of the information.  These criteria provide a means of assessing whether or not the data inventory used in the estimate is adequate for that purpose.  The resource estimate stated in this document was based on the criteria set out in Table 1 of that Code.  These criteria have been discussed in the main body of the document and are summarised below.  Only sections relevant to the reported resource have been addressed.  The JORC Code Assessment Criteria in the following table are italicised.

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 (eg 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 (eg '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 (eg submarine nodules) may warrant disclosure of detailed information.

The recent drilling used reverse circulation and diamond drilling to obtain samples. From the RC drilling  2 kg subsamples were taken using rotary splitter for logging and laboratory analysis. Chip tray samples were collected logged and photographed.  Drill core was sampled on geological intervals.

The recent Desert Scheelite RC drill holes were sampled at 2.5-foot intervals.  Diamond drill holes are sampled on geological intervals.

The historic holes have samples recorded over intervals from 1 to 50 feet, most commonly 5 feet.

Sampling and analysis details for the 1970s drilling are unknown.

 

Drilling techniques

·    Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg 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).

The earlier 1970s drilling method is diamond and "rotary", believed to be percussion with annular return.

The recent drilling was RC using a face sampling hammer

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.

Sample recoveries have not been systematically quantified but anecdotally are consistently high.

 

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.

Recent drilling program have information for collar, survey, assay, lithology, weathering. Geology of the hole cuttings was qualitative logged and photographed over the entire hole length.

Older holes contain only collar survey and assay data with some geological logging of selected holes and intervals.

Sub-sampling 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.

2 kg subsamples were taken using a rotary splitter.  This size sample is considered representative considering the rock type and grain size.

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.Ba, Mo

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

Recent drill samples analysis was conducted by ALS Chemex in Reno. Sample and assay method has previously been approved by independent resource estimate practitioner.

QA/QC protocol has been adopted using certified reference material; certified blank material and field duplicate samples inserted at a rate of 15% or better.

Validation of the 1970s assay results was undertaken by twinning of four of the older holes with the recent drilling.  WO3 grades are comparable.  Cu and Ag are anomalous and require further investigation.

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.

Twin holes were used to check the veracity of the historical drilling.

The compiled drilling data was checked for internal consistency as part of the resource estimation.

Database Analytical data for the recent programs were validated against laboratory reports.

Location of data points

·    Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation.

·    Specification of the grid system used.

·    Quality and adequacy of topographic control.

Hole collar co-ordinates are referenced to NAD 83 (zone 11N).

Historic collar locations from 1970s were digitised from maps translated to NAD83.  Locations were cross checked against several maps. 

For the recent drilling, downhole surveys have been conducted using north seeking gyroscopic down hole tool.  Collar locations have been determined by US registered surveyor using differential GPS

The topography was based on a 1 m DEM.  Drill hole collars were registered to the topographic surface to remove minor discrepancies.

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.

Exploration results are not being reported.

Drill holes are inconsistently spaced at 10 m to 50 m on SE-NW sections nominally 100 m apart

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 Desert Scheelite mineralisation is hosted in steeply north dipping sediments.   The sub vertical drilling provides representative sampling of the deposit.

Sample security

·    The measures taken to ensure sample security.

Chain of custody details for the 1970s drilling are unavailable.

The chain of custody for the recent drill program at Desert Scheelite was reviewed on site by the CP delegate and deemed to be adequate.

Samples are under the supervision of the site geologist and stored in a secure, locked shed prior to shipment to the laboratory.

Audits or reviews

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

At this stage of the project no other independent external audits have been undertaken.

 

 

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.

Thor Mining plc hold 100%of the mineral leases covering the Desert Scheelite prospect located on the eastern flank of Pilot Mountain, 250 km southeast of the city of Reno and 20km east of the town of Mina, in Nevada, USA.

There are no known impediments to licence an operation

.

Exploration done by other parties

·    Acknowledgment and appraisal of exploration by other parties.

The deposit discovery date is not known.  The deposit was held by Duval in the early 1970s and subsequently by the Union Carbide Corporation (UCC) in the late 1970s

Pre - 2012 data is treated as historic data and used as a guide only unless validated.

Pre-existing data post-2012 has been collated in accordance with the guidelines of the JORC (2012) code.

Geology

·    Deposit type, geological setting and style of mineralisation.

Contact metamorphic skarn hosted tungsten.

Drill hole Information

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

o easting and northing of the drill hole collar

o elevation or RL (Reduced Level - elevation above sea level in metres) of the drill hole collar

o dip and azimuth of the hole

o down hole length and interception depth

o 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.

Details of the drilling used to define the resources are included in the resource estimation documentation.

Data aggregation methods

·    In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg 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.

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 drill hole angle is known, its nature should be reported.

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

Exploration results are not being reported.

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 drill hole collar locations and appropriate sectional views.

Exploration results are not being reported.

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.

Exploration results are not being reported.

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.

Exploration results are not being reported.

 

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.

Exploration results are not being reported

 

 

 

 

 

 

 

 

 

 

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.

A check of the database against laboratory certificates was undertaken as part of the database validation.  The internal referential integrity of the database was checked as part of the resource estimation.

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.

In 2012, a Golder Associates geologist was delegated by the Competent Person to inspect the Desert Scheelite site as part of the resource estimation process.  A delegate was used due to logistical issues at the time.  The inspection reviewed the drilling and sampling process and confirmed the site and data were accurately represented in reports of prior owners and the drill hole database. The delegate visited all Pilot Mountain deposits.

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.

The geology of the deposit was interpreted using logged lithology and sample analyses to define zones of mineralised skarn. 

The geological interpretation along strike and up dip is confined by the drilling and model extent.

 

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.

Desert Scheelite strikes 750 m east to west and spans 300 m north to south.

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 (eg 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 drill hole data, and use of reconciliation data if available.

The estimation was performed via conventional 3D estimation with the orientation of the search ellipsoid in accordance with the general orientation of the mineralised deposit within the channel.

A four-pass kriging plan was used with an octant-based search.  With the second through to fourth passes using progressively larger search neighbourhoods to enable the estimation of blocks remaining un-estimated following the preceding passes.

Block discretisation was set to 5 (X) by 5 (Y) by 2 (Z) to estimate block grades of 30 m by 15 m by 3 m parent blocks.  Sub-cells of 6 m by 3 m by 1.5 m received the parent cell estimate when possible.

A minimum of 4 composites and a maximum of 40 composites (Pass 1) overall, with a minimum of 2 octants applied with a maximum of 5 samples per octant with a limit of 5 samples per drill hole.

Length-weighting was applied to compensate for variations in composite length for the data used in the estimation.

The estimation was performed by mineralised domain code which separates individual mineralised domains.

 

Moisture

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

Tonnages are estimated on a dry basis.

Cut-off parameters

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

Modelling of the mineralised zones used a nominal 1000 ppm WO3 edge cut off but relied more on geology.

The resource has been reported at a range of cut off grades. No mining or financial analysis has been undertaken on the deposit to validate this figure.

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.

No mining assumptions have been incorporated into the resource estimate.  Historically Pilot Mountain deposits have been mined from shallow underground workings.  The deposit contains near surface mineralisation and as such it could be anticipated that preliminary mining will be by open pit methods. 

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.

No metallurgical factors or assumptions have been incorporated into the resource estimate.

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 reasonable prospects for eventual economic extraction 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.

Preliminary investigations by the tenement holder have not identified any environmental impacts from conceptual mining operations which would influence the cost base or the viability of mining of these resources.

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.

Dry bulk density values assigned were based on 720 samples taken from during the recent drilling programs.  Average values by geology were calculated.

Classification

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

·    Whether appropriate account has been taken of all relevant factors (ie 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.

Indicated and Inferred Resources have been identified for Desert Scheelite based principally on the confidence in the geological interpretation and the density of data.

Audits or reviews

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

At this stage of the project no external audits have been undertaken.

Discussion of relative accuracy/ confidence

·    Where appropriate a statement of the relative accuracy and confidence level in the Mineral Resource estimate using an approach or procedure deemed appropriate by the Competent Person. For example, the application of statistical or geostatistical procedures to quantify the relative accuracy of the 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 Competent Person considers the resource to be a robust global estimate of the data available.   

The integrity of the historical raw data cannot be guaranteed other than to state that the data is consistent with the recent drilling and the geology is consistent with the type and style of mineralisation.

There is no production data against which to compare the estimate.

 


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