Heron Resources Limited (ASX:HRR TSX:HER, “Heron” or the
“Company”) is pleased to report an upgrade to the Mineral
Resource estimate for the shallow G2 Lens and a revision of the
total underground Mineral Resources at its wholly-owned Woodlawn
Zinc-Copper Project, located 250km south-west of Sydney, New South
Wales, Australia. The resource upgrade follows on from the
recently completed drilling program that focused on expanding the
shallow G2 position, in areas close to the proposed box-cut and
decline.
- New Mineral Resource estimate provided for the first
mineralisation (G2 Lens) to be accessed in the Woodlawn underground
mine – expected to have a positive impact on early cash
flow
- G2 Mineral Resource now has three defined domains: G2
Main (G2), G2 Hanging Wall (GH) and G2 Copper Zone
(GC)
- Combined Mineral Resource for G2 now estimated
at:
- 139kt @ 10.1% ZnEq1 (4.5% Zn, 0.8% Cu,
2.3% Pb, 0.4g/t Au, 33g/t Ag) - Indicated
Category
- 58kt @ 13.3% ZnEq (4.0% Zn, 1.0% Cu, 2.2% Pb, 1.2g/t
Au, 117 g/t Ag) - Inferred Category
- Total underground Mineral Resources for Woodlawn were
recalculated as part of this update with separate cut-off grades
used for polymetallic and copper domains resulting in a 9.1%
increase in total tonnes and a slight lowering of the copper grades
within the copper domains
- Importantly the total Measured and Indicated Mineral
Resource for the underground has increased by 0.5Mt or 12% which
has the potential to add to the total reserve base
- G2 Ore Reserve estimation, selected metallurgical
testing and updating of early mine schedule is
underway
1 ZnEq % used in this release refers to the calculated Zn
equivalent grade based on the Zn, Cu, Pb, Au and Ag grades, the
formula for which is provided at the end of this report.
Commenting on the results, Heron Resources
Managing Director and CEO, Mr Wayne Taylor, said:
”This significant upgrade to the G2 Lens and
total underground Mineral Resources is an encouraging development
for the early stages of the mine development and we are looking
forward to incorporating this material into the mine plan. It
is expected to have a positive impact on the early cash flows of
the project as the G2 area did not contribute to the feasibility
study projections and will be the first source of underground
production. These results along with the remaining
extensional positions continue to demonstrate the discovery
potential and economic upside at Woodlawn.”
G2 Lens
The G2 Lens is located to the south of the Kate
Lens, and is adjacent to the planned route of the decline, 100-200m
below the surface (see Figures 1-4). Recent drilling has
targeted this area for its ability to add to the early mine
inventory. A program of 22 diamond core holes for a total of
4,246m was recently completed to further define the resource.
Three key mineralised horizons have been identified, namely G2 Main
(G2), G2 Hanging-wall (GH) and the newly defined G2 Copper zone
(GC).
The G2 Main was the primary target of the recent
drilling campaign and consists of a zone of 5-10cm zinc
sulphide-rich stringers crosscutting beds of coarse-grained
volcanic breccia. The GH zone was discovered during the follow-up
program and comprises very high-grade massive and stringer
polymetallic sulphides occurring approximately 30 to 40m
stratigraphically above the G2 Main zone hosted in mudstone.
The GC zone is typical Woodlawn copper sulphide mineralisation
consisting of both sulphide stringer and some massive sulphide
(pyrite/chalcopyrite) in a chlorite alteration zone.
Full assay results from the recent drilling program are
provided in Heron’s ASX release dated 19 September 2017.
G2 Lens Mineral Resource
Estimate
The G2 Lens Mineral Resource estimate was
undertaken by Heron and verified by SRK Consulting. It has been
estimated in accordance with the JORC Code (2012) and the NI 43-101
guidelines. Two distinct types of mineralisation have been
modelled: 1) Polymetallic mineralisation and 2) Copper dominated
mineralisation. Details of the estimation methodology used is
provided below and within the JORC (2012) Table 1 at the end of
this report.
G2 Mineral Resource Estimate 2017
(Cut-off grades are 7% ZnEq for polymetallic, and 1% Cu for
copper mineralization)
Indicated Mineral Resources
Lens |
Domain |
Resource Category |
Quantity (kt) |
ZnEq (%) |
Zn (%) |
Cu (%) |
Pb (%) |
Au (g/t) |
Ag (g/t) |
G2 |
Polymetallic |
Indicated |
100 |
11.9 |
6.3 |
0.5 |
3.1 |
0.41 |
41 |
GC |
Copper |
Indicated |
39 |
5.5 |
0.1 |
1.5 |
0.0 |
0.36 |
10 |
Total |
Combined |
Indicated |
139 |
10.1 |
4.5 |
0.8 |
2.3 |
0.40 |
33 |
Inferred Mineral Resources
G2 |
Polymetallic |
Inferred |
25 |
11.9 |
6.1 |
0.4 |
3.2 |
0.76 |
46 |
GH |
Polymetallic |
Inferred |
6 |
54.0 |
13.7 |
0.7 |
7.9 |
6.33 |
878 |
GC |
Copper |
Inferred |
28 |
5.3 |
0.1 |
1.5 |
0.0 |
0.34 |
8 |
Total |
Combined |
Inferred |
58 |
13.3 |
4.0 |
0.9 |
2.2 |
1.16 |
117 |
Notes: 1) Please refer to the end of this
release for Qualified Persons statements; 2) ZnEq refers to a
calculated Zn equivalent grade the formula for which is stated at
the end of this report; 3) Polymetallic Type refers to
polymetallic massive sulphide mineralisation with high-grade Zn and
Pb; Copper Type refers to Cu dominated massive and stringer
sulphide mineralisation; 4) Some rounding related discrepancies may
occur in the totals; 5) the Mineral Resource is reported in
accordance with the the JORC Code (2012) and NI 43-101 43-101
guidelines; 6) further details of the Mineral Resources estimation
are provided in the JORC Code (2012) Table 1 at the end of this
report.
Total Woodlawn Underground Mineral
Resource 2017
The total Woodlawn underground Mineral Resource
was recalculated as part of the update process, now using a cut-off
grade for the copper domain mineralisation of 1% Cu, which has led
to a 9.1% increase in the total tonnes of the Mineral
Resource with a slight reduction in the copper grades
within the copper domains. The use of a separate and tailored
cut-off grade for the copper mineralisation was deemed to be more
reflective of the physical and commercial performance of this
potential production source.
A review of the Ore Reserves and potential total
mining inventory has commenced and is to be released in the coming
weeks.
Woodlawn Total Underground Mineral
Resource 2017(7% ZnEq cog for Polymetallic and 1%
Cu cog for Copper)
Indicated + Measured Mineral
Resource
|
|
|
Tonnes Mt |
ZnEq % |
Zn % |
Cu % |
Pb % |
Au g/t |
Ag g/t |
All
Lenses |
Polymetallic |
Ind+Mea |
2.7 |
21.6 |
10.9 |
1.5 |
4.0 |
0.7 |
79 |
All Lenses |
Copper |
Ind+Mea |
1.9 |
9.7 |
0.7 |
2.6 |
0.1 |
0.2 |
14 |
Total |
Combined |
Ind+Mea |
4.6 |
16.7 |
6.7 |
1.9 |
2.4 |
0.5 |
52 |
Inferred Mineral Resource
|
|
|
Tonnes Mt |
ZnEq % |
Zn % |
Cu % |
Pb % |
Au g/t |
Ag g/t |
All
Lenses |
Polymetallic |
Inf |
1.9 |
16.9 |
7.3 |
1.5 |
3.0 |
0.8 |
61 |
All Lenses |
Copper |
Inf |
0.7 |
9.2 |
0.7 |
2.5 |
0.1 |
0.2 |
12 |
Total |
Combined |
Inf |
2.6 |
14.9 |
5.6 |
1.8 |
2.2 |
0.6 |
48 |
Notes: 1) Please refer to the end of this
release for Qualified Persons statements; 2) ZnEq refers to a
calculated Zn equivalent grade the formula for which is stated at
the end of this report; 3) Polymetallic Type refers to
polymetallic massive sulphide mineralisation with high-grade Zn and
Pb; Copper Type refers to Cu dominated massive and stringer
sulphide mineralisation; 4) Some rounding related discrepancies may
occur in the totals; 5) the Mineral Resource is reported in
accordance with the the JORC Code (2012) and NI 43-101 43-101
guidelines; 6) further details of the Mineral Resources estimation
are provided in the JORC Code (2012) Table 1 at the end of this
report.
Mineral Resource Description and
Methodology
The Woodlawn Volcanogenic Massive Sulphide (VMS)
mineralisation is hosted in Late Silurian deep water marine
mudstones and volcaniclastic debris flows associated with a
rhyolitic volcanic centre within the Goulburn Basin. The Woodlawn
deposit comprises of 12 known sulphide lenses which form three
mineralised horizons locally disrupted by faulting. The Zn, Cu and
Pb mineralisation occurs as massive and stringer sulphide lenses,
interpreted to have formed both on the sea floor and as replacement
mineralisation in coeval mudstones and volcanic breccia flows. The
mineralisation is derived from hydrothermal fluids which emanated
from the adjacent volcanic centre and is associated with an
aerially extensive, zoned alteration envelope.
The G2 lens mineralisation is part of the
broader G Lens complex, located at the southern end of the
uppermost mineralised horizon. Mineralisation is hosted in both
mudstones, and volcanic derived breccia flows. The G Lens was
previously mined from the G1 and G2 Lenses, and the new
mineralisation identified by Heron is a combination of extensions
to the previously mined lenses and newly identified mineralisation
positioned to the south of and below the known lenses.
The Mineral Resource at Woodlawn is defined by
both historic and recent Heron diamond drilling, as well as
underground mapping in previously mined areas. Drill
intercept spacing varies from 15x15 m to 20x30 m across the
modelled lens area.
The G2 Lens Mineral Resources were estimated
using block models constrained within wire-framed domains defined
mainly by interpreted geologic and structural contacts, using lower
cut off grades based on population breaks of 4.0% Zn in
polymetallic domains, and 1% Cu in copper domains. Where
appropriate, some material of lower grade was included with the
mineralised domains for purposes of continuity. Estimations
were carried out using ordinary kriging for Zn, Cu, Pb, Fe, Ag and
Au. Specific gravity (density) determinations collected from
samples of drill cores were applied to blocks using grade-based
regression equations.
Tonnages and grades were reported above 7.0%
ZnEq for the polymetallic mineralisation as in keeping with
previous Mineral Resource statements, and at a 1% Cu cut-off grade
for the copper mineralisation. The Mineral Resource estimate has
been separately classified for each individual lens based on both
geological interpretation confidence and geostatistical variance of
assay composites between drill holes into the following
categories: Measured (15x15m spaced drilling with geological
backs mapping); Indicated (up to 20x30m spaced drilling); and
Inferred (greater than 20x30m spaced drilling).
Mineral Resource estimation was undertaken for the
entire G Lens complex, however, there were no material changes to
the G1 and G3 domains and they are therefore, not separately
reported here.
G2 Lens Mineral Resources are expected to be mined
using underground mechanised underhand long-hole stoping with paste
backfill. Extraction of separate Zn, Cu and Pb concentrates for
sale is planned utilising a new processing facility which is
currently under construction at the site.
Ore Reserve estimation, selected metallurgical
testing and the updating of the early mine schedule has commenced
on the new G2 resource and will be reported on separately.
Figure 1: Woodlawn G2 Lens (G2 &
GC) long-section showing interpreted lens shape, piercements of
recent drilling and the position of proposed decline.
http://www.heronresources.com/tsximages/20171113/131117_fig1.jpg
Figure 2: Woodlawn G2 Hanging Wall
Lens (GH) long-section showing interpreted lens shape, piercements
from recent drilling and the location of the proposed
decline.
http://www.heronresources.com/tsximages/20171113/131117_fig2.jpg
Figure 3: Woodlawn G Lens complex
long-section looking east showing key lens components in relation
to the proposed box cut and decline. Kate lens shown for
reference.
http://www.heronresources.com/tsximages/20171113/131117_fig3.jpg
Figure 4: G2 Lens representative
cross-section at approximately mine grid 19180
North.
http://www.heronresources.com/tsximages/20171113/131117_fig4.jpg
About Heron Resources
Limited:
Heron’s primary focus is the development of its
100% owned, high grade Woodlawn Zinc-Copper Project located 250km
southwest of Sydney, New South Wales, Australia. In addition,
the Company holds a significant high quality, gold and base metal
tenement holding regional to the Woodlawn Project.
Compliance Statement (JORC
2012)
The technical information in this report
relating to the Mineral Resource is based on information compiled
by Mr. Steven Jones, who is a Member of the Australian Institute of
Mining and Metallurgy (Chartered Professional – Geology). Mr. Jones
is a full time employee of Heron Resources Limited and 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. Mr. Jones has approved the
scientific and technical disclosure in the news release.
Compliance Statement (NI43
101)
The technical information in this report
relating to the Mineral Resource is based on information compiled
by Mr. Rodney Brown who is a Member of the Australian Institute of
Mining and Metallurgy (Chartered Professional – Geology). Mr. Brown
is a full time employee of SRK Consulting and 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 an independent “qualified person” as this
term is defined in Canadian National Instrument 43-101 (“NI
43-101”). Mr. Brown has approved the scientific and technical
disclosure in the news release.
CAUTIONARY NOTE REGARDING
FORWARD-LOOKING INFORMATION
This report contains forward-looking statements
and forward-looking information within the meaning of applicable
Canadian securities laws, which are based on expectations,
estimates and projections as of the date of this report. This
forward-looking information includes, or may be based upon, without
limitation, estimates, forecasts and statements as to management’s
expectations with respect to, among other things, the timing and
amount of funding required to execute the Company’s exploration,
development and business plans, capital and exploration
expenditures, the effect on the Company of any changes to existing
legislation or policy, government regulation of mining operations,
the length of time required to obtain permits, certifications and
approvals, the success of exploration, development and mining
activities, the geology of the Company’s properties, environmental
risks, the availability of labour, the focus of the Company in the
future, demand and market outlook for precious metals and the
prices thereof, progress in development of mineral properties, the
Company’s ability to raise funding privately or on a public market
in the future, the Company’s future growth, results of operations,
performance, and business prospects and opportunities. Wherever
possible, words such as “anticipate”, “believe”, “expect”,
“intend”, “may” and similar expressions have been used to identify
such forward-looking information. Forward-looking information is
based on the opinions and estimates of management at the date the
information is given, and on information available to management at
such time. Forward-looking information involves significant risks,
uncertainties, assumptions and other factors that could cause
actual results, performance or achievements to differ materially
from the results discussed or implied in the forward-looking
information. These factors, including, but not limited to,
fluctuations in currency markets, fluctuations in commodity prices,
the ability of the Company to access sufficient capital on
favourable terms or at all, changes in national and local
government legislation, taxation, controls, regulations, political
or economic developments in Canada, Australia or other countries in
which the Company does business or may carry on business in the
future, operational or technical difficulties in connection with
exploration or development activities, employee relations, the
speculative nature of mineral exploration and development,
obtaining necessary licenses and permits, diminishing quantities
and grades of mineral reserves, contests over title to properties,
especially title to undeveloped properties, the inherent risks
involved in the exploration and development of mineral properties,
the uncertainties involved in interpreting drill results and other
geological data, environmental hazards, industrial accidents,
unusual or unexpected formations, pressures, cave-ins and flooding,
limitations of insurance coverage and the possibility of project
cost overruns or unanticipated costs and expenses, and should be
considered carefully. Many of these uncertainties and contingencies
can affect the Company’s actual results and could cause actual
results to differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, the Company.
Prospective investors should not place undue reliance on any
forward-looking information. Although the forward-looking
information contained in this report is based upon what management
believes, or believed at the time, to be reasonable assumptions,
the Company cannot assure prospective purchasers that actual
results will be consistent with such forward-looking information,
as there may be other factors that cause results not to be as
anticipated, estimated or intended, and neither the Company nor any
other person assumes responsibility for the accuracy and
completeness of any such forward-looking information. The Company
does not undertake, and assumes no obligation, to update or revise
any such forward-looking statements or forward-looking information
contained herein to reflect new events or circumstances, except as
may be required by law. No stock exchange, regulation
services provider, securities commission or other regulatory
authority has approved or disapproved the information contained in
this report.
Zinc equivalent calculationThe
zinc equivalent ZnEq calculation takes into account, mining costs,
milling costs, recoveries, payability (including transport and
refining charges) and metal prices in generating a Zinc equivalent
value for Au, Ag, Cu, Pb and Zn. ZnEq = Zn%+Cu%*3.12
+Pb%*0.81+*Au g/t*0.86+Ag g/t*0.03. Metal prices used in the
calculation are Zn US$2,300/t, Pb US$ 2,050/t, Cu US$6,600/t, Au
US$1,250/oz and Ag US$18/oz. These metal prices are based on
Heron’s long-term view on average metal prices. It is Heron’s
view that all the metals within this formula are expected to be
recovered and sold. Metallurgical metal recoveries used for
the formula are 88% Zn, 70% Pb, 70% Cu, 33% Au and 82% Ag; these
are based on historical recoveries at Woodlawn and supported by
metallurgical test work undertaken during the 2015-16 feasibility
study. Commodity prices and metallurgical recoveries are
factored into the zinc equivalent calculation using a standard
metal equivalent formula.
JORC Code (2012) – Table 1
Woodlawn Underground Mineral Resource Estimate (October
2017)
Section
1
Sampling Techniques and Data
(Criteria in this section applies to all
succeeding sections)
Criteria |
Commentary |
Sampling techniques |
- The sampling dataset that forms the basis of the Mineral
Resource estimate consists mostly of drill samples that have been
collected from the 1970’s up to the present day and, for reporting
purposes, is split into two groups, Historical being pre-1999
samples from Jododex, CRA and Denehurst exploration and mining
operations, and Recent being post 1999 drilling samples from
exploration by Heron Resources Ltd (Heron) and TriAusMin Ltd
(TriAusMin). The Heron drilling was undertaken from September
2014 to October 2017 (Phase I, II, III and IV drilling programs)
and the TriAusMin drilling was undertaken between January 2007 and
May 2013.
- The Phase I and II drilling programs (104 DDH for 27,048 metres
and 11 RC holes for 1,201 metres) completes the drilling required
to estimate the Mineral Resource for the Woodlawn feasibility study
(FS). Phase III and IV drilling comprises (29 DDH for 6,543.5m
)
- Heron also drilled 23 geotechnical diamond drill holes (for
2,105 metres) to assist with engineering studies associated with
the mine design and reserve calculations.
- The majority of Recent diamond core samples were taken from HQ3
sized core (with a smaller proportion of NQ2 and NQ3 sized core)
and generally collected on a nominal interval length of 1m, with
samples terminated at geological contacts. The core was
halved along the core orientation line. In economic
mineralised zones, quarter core was submitted for assaying, half
core preserved for metallurgical testing, with the remaining
quarter retained as reference material. In likely to be sub
economic zones half core was submitted for assaying.
- The Recent percussion reverse circulation (RC) holes (11 holes
drilled in 2014 with two of these used in the Mineral Resource
estimate) were drilled using a 4.5 inch sized bit. Samples
were collected on 1m intervals. In the waste zones, a sample
spear was used to collect a split from each interval, which were
subsequently combined to form 4m composites. In the
mineralised zone, the 1m interval was retained and a split
collected using a riffle splitter.
- The Recent sampling methods were consistent with accepted
industry practice and are considered to provide representative
samples for the mineralisation encountered.
- Historical RC drilling was not used in the Mineral Resource
estimate.
- Historical surface and underground diamond drilling has been
used in the Mineral Resource. The majority of the samples
were collected from half NQ core, although some underground samples
were taken from whole BQ core. Core was sampled on 1m
intervals, with the intervals usually split at lithological
boundaries. Some of the early exploration core was sampled on
imperial intervals, which were subsequently metricised in the
Historical database.
- Some Historical face chip samples have been used in the Mineral
Resource calculation. This was limited to samples taken from
cross cuts that spanned the complete section of the mineralised
lens. Rock chip samples were taken as a continuous channel from the
wall rocks on 1-2m intervals, with each sample weighing were
approximately 2-3kg. Samples were taken to geological
contacts.
- Resampling of the massive sulphide intervals from the
Historical drilling has been undertaken where the drill core was
still of reasonable quality. A total of 116 repeat samples
were taken and showed acceptable correlation with the reported
Historical assay results. In addition, Historical production
reconciliation suggests that there was an acceptable correlation
between the grades derived from sampling and concentrate production
over the life of the underground mine.
|
Drilling techniques |
- The Recent diamond-core drilling was performed mostly using
McCulloch DR800 rigs (or similar) for Phase I and Sandvik UDR650
for Phase II and III. Sandik DE 710 track mounted rigs were used
for phase IV drilling. Various techniques were employed to
ensure the hole was kept within limits of the planned position,
including directional drilling. The retrieved core was laid out in
standard plastic cores trays.
- The Recent RC drilling was performed using a Schramm T450WSI
rig fitted with a 4.5 inch face sampling hammer. One metre
samples were collected via a Jones 5:1 splitter fitted to the rig
cyclone.
- Historical diamond drilling was undertaken by both surface and
underground rigs. The full drill company and rig details are
poorly understood, however anecdotal evidence indicates it was
conducted with standard drill equipment and procedures for that
time. Historical core stored on site represents approximately
fifty percent of the historical drilling. The majority of core is
intact and in good condition, apart from some limited surface
oxidation and degradation of the sulphide zone in the vicinity of
joint planes. Metre marks, sample marks and hole numbers are
visible for almost all holes stored on site. Select key holes
have been stored off site at Geological survey of NSW Maitland core
library and the University of Newcastle.
|
Drill sample recovery |
- The drill core was transported to an enclosed facility for
logging and preparation. The average recovery exceeds
95%. The core was orientated, where possible and marked with
1 metre downhole intervals for logging and sampling.
- The recoveries for the Recent RC drilling were visually
estimated, with most being close to 100%.
- Historical core stored on site shows a similar level of
recovery to that from the recent diamond drilling. With the
exception of some geotechnical holes, the Historical exploration
and underground core does not appear to have been orientated.
|
Logging |
- For recent drilling, both diamond core and RC holes were
geologically logged. Geotechnical logging was conducted on
selected core intervals. Samples for metallurgical testing
were stored in a freezer to reduce oxidation prior to metallurgical
testing.
- Historical core was geologically logged. Some holes were
geotechnically logged, and some were used for metallurgical test
work.
|
Sub-sampling techniques and sample preparation |
- For recent drilling, all core samples were crushed and then
pulverised in a ring pulveriser (LM5) to a nominal 90% passing 75
micron. For each interval, a 250g pulp sub-sample was taken,
with the remainder stored for reference.
- For recent programs a quartz flush was put through the LM5
pulveriser prior to each new batch of samples. Multiple
quartz flushes were also put through the pulveriser after each
massive sulphide sample processed. A selection of the flush
material was analysed and reported by the lab to gauge the
potential level of contamination that may be carried through from
one sample to the next.
- The recent RC samples were pulverised in an LM5 ring
pulveriser. The same quartz flush procedures as those
described above were used.
- For the majority of Historical sampling, preparation and
analysis was carried out on site by Denehurst Analytical Services
Pty Ltd, a NATA accredited laboratory. An independent review of the
laboratory was carried out in 1986 by Robertson Research. At
that time the following procedures were being used: 1) All
samples were crushed to 1.5mm using a combination of jaw and roll
crushers; 2) Crushed samples were quartered to obtain a 150gram cut
for pulverising in a Rocklabs bowl and puck pulveriser; 3) A
quartz flush was used between individual samples.
- A number of Historical samples, including all early exploration
surface diamond drilling, were prepared at other commercial
laboratories using methods that are understood to be similar to
those described above.
|
Quality of assay data and laboratory tests |
- Recent sample preparation and assaying was conducted by ALS
Laboratories, Orange, New South Wales with the final analysis of
the pulps undertaken at ALS Laboratory, Brisbane or Townsville,
Queensland.
- Recent Gold assays were determined by 30g fire assay fusion
with AAS analysis to 1ppb LLD.
- Recent other elements were assayed by mixed acid digestion
followed by ICP analysis. The digest is considered to be a total
digest.
- Recent Laboratory quality control standards (blanks, standards
and duplicates) were inserted at a rate of 5 per 35 samples for
ICP and AAS analysis.
- Most of the Historical sample preparation and assaying was
carried out by Denehurst Analytical Pty Ltd (Denehurst Laboratory),
which was a NATA accredited laboratory operating at the Woodlawn
site. Zinc, lead and copper grades were determined by acid
digest and AAS finish. An aliquot from each pulp was also analysed
by XRF pressed powder for precious metals, iron, silicon,
aluminium, magnesium and barium, along with repeats of zinc, lead
and copper. Gold assays over 2g/t were retested by fire assay
and AAS finish. QAQC procedures included Standards inserted
at a frequency of 1:30, however the actual QAQC data have not been
located. Anecdotal evidence indicates the Denehurst
Laboratory was well regarded at the time of operation and was used
for umpire assaying by other laboratories.
- Some sample preparation and assaying for the Historical data,
in particular the early exploration diamond drilling samples, were
carried out by various other commercial laboratories. Exact details
have not been located for these samples and the Historical database
does not contain information describing which laboratories or assay
methods were used for the various programmes.
|
Verification of sampling and assaying |
- For recent data, an internal review of results was undertaken
by company personnel. Independent verification has also been
undertaken by the Company’s geological consultants.
- Until July 2017 all Heron field and laboratory data were
entered into a database using a consultant database administrator
(DBA), who was based in the Company’s Perth office.
Validation of both the field and laboratory data was undertaken
prior to final acceptance and reporting of the data. From July 2017
this function has been passed to a permanent Heron employee DBA,
working from the Woodlawn site.
- For recent drilling, quality control samples from both the
Company and the Laboratory were assessed by the DBA and reported to
the Company geologists for verification. Company procedures
dictate that all assay data must pass this data verification and
quality control process before being reported.
- All data from Historical data bases were entered into the Heron
Database by the DBA. Original source data and laboratory records
have not been located and the assay data has not been
verified.
- At the time of Historical data collection, QAQC checks were not
routinely carried out by the mine geology department, however the
laboratory did do internal standard analysis at the rate of 1 in 30
samples. During operations, the mine claim grades (derived from the
Reserve and Resource models) were routinely reconciled against the
mill concentrate grades. As a semi-quantitative test, this
suggests that the Historical drilling assay results are
sufficiently accurate for the prediction of mining grades.
- No adjustments have been made to assay data within the
database.
|
Location of data points |
- The deposit is not thought to contain magnetic minerals in
concentrations that may adversely affect survey equipment.
- For recent drilling, drill collars were initially located with
a combination of handheld GPS and licenced surveyor using a DGPS
system, to an accuracy of approximately 1m. The final drill
collar locations are surveyed by a licenced surveyor.
- For recent drilling, downhole surveys were conducted using an
Eastman, Pathfinder or Ranger survey tool to record the magnetic
azimuth and dip of the hole. These recordings were taken
approximately every 30 metres downhole. Approximately 80% of
the recent holes were also surveyed with gyroscopic equipment.
- For recent drilling in the Phase I program a north seeking
gyroscopic tool was used to provide collar azimuth data for
approximately half the diamond holes.
- For Historical drilling collar surveys were carried out on all
surface and underground holes using conventional Total Station
equipment.
- Down-hole surveys of Historic holes were carried out using
down-hole cameras of various types, and recording intervals of
approximately 30m.
- Historical drill holes intersected in underground workings were
routinely picked up by the mine surveyor. These data
indicated the downhole survey azimuth accuracy was usually in the
order of +/- 2 degrees.
- All Historical primary source data for collar surveys, and most
down-hole surveys have been located and verified against the
Historical drill hole database.
- Down-hole magnetic survey data have been checked and adjusted
for changes in magnetic declination.
|
Data spacing and distribution |
- Drill data spacing varies from 15m x15m in some remnant parts
of the historical mine and recent G2 drilling to greater than 80m x
80m in some exploration areas.
- Historical backs mapping data covering all development
(generally on 5m flitches) have been used to help define geological
contacts in areas of previous mining. Geological structures
identified in the mapping data have been used to constrain the
dimensions of drilled extensions to previously mined lenses.
- Data are considered to be of sufficient spacing to establish
geological and grade continuity for resource estimation, and the
resource classification reflects the geological and grade
continuity confidence of the modelled material.
- Lenses with insufficient drilling data have been modelled for
exploration targeting purposes, but have not been assigned resource
classifications or included in the resource inventory. This
includes portions of the new Lisa Lens, portions of B Deeps and
parts of the G lens extensions.
- The majority of the sample lengths are between 0.22m to
1.0m. Some Historical samples were taken over 3’ intervals
(converted to metric equivalents in the database). Some
underground face samples are 2m in length.
- All samples were composited to 1m length for resource modelling
purposes. All composites were density weighted.
|
Orientation of data in relation to geological structure |
- The recent drill hole orientations were designed to intersect
the mineralised lenses at a close to perpendicular angle. The
mineralised lenses dip at approximately 50-70 degrees to the west
and the holes dip at approximately 60 degrees to the east.
- The majority of Historical drilling has been orientated to
intersect the lenses at a close to perpendicular angle.
- Some underground drill holes have been collared in the
footwall, and cross the lenses at a lower angle than 50
degrees.
- No significant sampling bias due to the orientation of the
drilling has been identified.
|
Sample security |
- Sampling was conducted according to written procedures, and was
performed by appropriately trained and supervised sampling
personnel.
- Core was photographed after mark up, but before sampling.
- Half and quarter core samples were placed in numbered and tied
calico sample bags.
- Samples were weighed on site and density of all samples
determined before being sent to the laboratory.
- Samples were secured in plastic bags and are transported to the
ALS laboratory in Orange, NSW via a courier service or
with Company personnel.
- The sample security of Historical drilling is not known,
however most samples were assayed at the onsite laboratory.
- All recent drilling, and approximately half of the Historical
drilling is stored at the Woodlawn core yard.
|
Audits or reviews |
- In September 2014 a review and assessment of the ALS laboratory
procedures was carried out by company senior geology personnel
resulted in some changes to the laboratory sample pulverising
procedures resulting in additional quartz flushes being inserted
after massive sulphide samples. Further ALS Laboratory visits
were undertaken by Heron geologists to check procedures in 2015 and
again in September 2017.
- The majority of Historical assay work was carried out by the
NATA certified Denehurst Analytical Laboratory.
- The Historical laboratory procedures were reviewed as part of a
broader independent assessment of resources and reserves carried
out by Mr R E Cotton of Robertson Research in 1986.
|
Section
2
Reporting of Exploration Results
(Criteria listed in the preceding section also
apply to this section.)
Criteria |
Commentary |
Mineral tenement and land tenure status |
- The Woodlawn Project is located 250km south-west of Sydney in
the state of New South Wales. The area is near the top of the
Great Australian Dividing range and has an elevation around 800m
above sea-level. The mineral and mining rights to the project
are owned 100% by Heron Resources through the granted, Special
Mining Lease 20 (SML20), also known as S(C&P)L 20. The
lease has recently been renewed for 15 years and has an expiry date
of the 16th November 2029.
- The project area is on private land owned by Veolia who operate
a waste disposal facility that utilises the historical open-pit
void. An agreement is in place with Veolia for the Company to
purchase certain sections of this private land to facilitate future
mining and processing activities.
- A cooperation agreement is also in place between Veolia and the
Company that covers drilling, other exploration activities and
mining/processing in the area.
|
Exploration done by other parties |
- The Woodlawn deposit was discovered by the Jododex JV in 1970
and open-pit mining began in 1978 and continued through to 1987.
The project was bought outright by Rio Tinto (CRA) in 1984 who
completed the open-pit mining. Underground operations commenced in
1986 and the project was sold to Denehurst Ltd in 1987 who
continued underground mining up until 1998. The mineral
rights to the project were then acquired by TriAusMin Ltd in 1999,
who conducted further studies on a tailings re-treatment and
revived underground operation. Heron took 100% ownership of
the project in August 2014 following the merger of the two
companies.
|
Geology |
- The Woodlawn deposit comprises volcanogenic massive sulphide
(VMS) mineralisation consisting of stratabound lenses of pyrite,
sphalerite, galena and chalcopyrite. The mineralisation is
hosted in the Silurian-aged Woodlawn Felsic Volcanic package of the
Goulburn sub-basin on the eastern side of the Lachlan Fold
Belt.
- Mineralisation is hosted within strata bound lens shaped lodes.
The lenses can be further divided into three favourable horizons
which host multiple lenses. The lenses have an average strike of
between 330 and 350 degrees, and dip at between 50 and 75 degrees
to the west. There is a prominent northwest oriented plunge to the
mineralisation of most lenses. Some of the lenses are further
subdivided by later faulting, associated with regional deformation.
Mineralisation is polymetallic with copper, lead and zinc being the
primary economic metals along with secondary silver and gold.
|
Drill hole Information |
- A total of 3,618 drill holes for 245,300 metres and associated
assays and lithological data are currently held in the database for
the Woodlawn deposit.
- Due to the size of the database it is not practical to list
every individual drill hole in Table 1. All Recent drilling results
have been released to the market prior to the calculation of the
Mineral Resource estimate.
|
Data aggregation methods |
- The details related to intercepts and assay management for
Mineral Resource estimation are to be found under the Mineral
Resource estimation section of the Table 1 (section 3).
|
Relationship between mineralisation widths and intercept
lengths |
- No exploration results in addition to those already published
are included in the Mineral Resource estimate.
|
Balanced reporting |
- No exploration results in addition to those already published
are included in the Mineral Resource estimate.
|
Other substantive exploration data |
- No exploration results in addition to those already published
are included in the Mineral Resource estimate.
|
Further work |
- Phase III and IV drilling programs were designed to test for
along strike mineralisation to the north of the B lens, and to
initially test and the drill out the G2 lens and associated lenses
in preparation for mine development. Further drilling is being
considered to: 1) extend the known lens positions along strike and
down plunge; 2) test for new lens positions where EM modelled
plates are present (eg Kate Deeps); 3) test for entirely new lens
positions along strike to the north and north-west where the system
has not been closed off and; 4) extend known satellite ore systems
at Cowley Hills and Currawang. 5) test targets within trucking
distance of the proposed Woodlawn plant, now under
construction.
|
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 |
Commentary |
Preamble and responsible people. |
- The revised underground Mineral Resource estimate for the
Woodlawn Project has been largely undertaken in-house by Heron
personnel, in particular Heron’s Senior Resource Geologist (Mr
Steven Jones, who is a member of the AusIMM – CP and deemed a
competent person to sign off mineral resources for this style
mineralisation).
|
Database integrity |
- For Recent data, all data were captured digitally, including,
collar survey, down-hole survey, geological logging, geotechnical
logging, sample selection and assay results. The geological and
geotechnical logging and sampling data were validated on entry in
the field. Clear written procedures outline how all data are
entered and managed in the field, and field geologists update the
procedures as changes are made to suit new data types (eg updating
of geological legend).
- Digital records were uploaded into the database by the DBA.
All source files were stored within the database. The
database has internal validation procedures for most data types to
minimise the chance of transcription errors. Initial data
validation was done automatically (the database will not accept
data contrary to validation criteria).
- Secondary validation was carried out as data was added to the
database. Regular downloads from the database were validated in 3D
mining packages by the geological team after each assay batch
received.
- All updates and changes to the database, including corrections
from the geological team, were carried out by the DBA.
|
Site visits |
- Mr Jones visited the site numerous times during the drilling
and post drilling to check the successful implementation of site
procedures, including drilling, logging, sampling, and density
measurements.
- SRK Consulting conducted a site visit in March 2015 to inspect
the project site, examine the geology, inspect core samples, and to
discuss aspects of the data acquisition and deposit geology with
site personnel. The geological setting and controls on
mineralisation observed in the exposures (pit walls) and core
samples are considered to be consistent with the geological
understanding that has been used for the preparation of the
geological model. There were no drill rigs operating at the
time of the site visit. However, an inspection of the core
storage facilities indicated both the historical and recent core to
be of an acceptable quality, and suitable for the preparation of
resource estimates
|
Geological interpretation |
- The geological interpretation was built upon on from an
extensive body of work by both researchers, and previous operators
at the mine.
- The geological model of the mine was built up from detailed
underground mapping, Historical underground and surface diamond
drilling, and Recent RC and diamond drilling by TriAusMin and
Heron.
- The underground mapping was completed during underground mining
operations, and consisted of 1:500 and 1:250 scale backs maps of
every underground development drive, including all flat back stope
lifts. The mapping line work was digitised by Heron geologists and
is used to develop wireframes of major faults and mineralisation
domain boundaries.
- The majority of mineralisation domain boundaries correspond to
the sharp contacts between the massive or stringer sulphide zones
and the silicate host rock. As a result the mapped and logged
geological contacts between sulphides and silicates provide a
robust basis for the interpretation of volumes and the selection of
samples for estimation of Mineral Resources.
- It was recognised in the previous mining operations that
individual lenses can have distinct mineralisation characteristics,
and this has been reflected in the domains used in the resource
estimate. In particular polymetallic mineralisation
(sphalerite, pyrite, galena, chalcopyrite and other minor
components) has been separated from Copper zone mineralisation
(principally pyrite, chalcopyrite) by domain boundaries, where
appropriate, within the model.
- The impact of alternative interpretations on the resource
quantities is considered to be adequately reflected in the
classifications assigned to the resource estimates:
- Measured material is defined in areas where both sufficient
drill hole and underground mapping data are available to confirm
both the grades and controlling structures (and thus volumes) of
the lenses. There is limited scope for an alternative
interpretation that would result in significantly different volumes
or grades.
- Indicated material is defined in areas where there is either
sufficient drilling, or sufficient underground mapping data
available to confirm the volume of the lenses. In previously mined
areas, the drill spacing is wider than expected for Measured (from
reconciliation work carried out on the block model vs production
records), or there has been no previous mining and the
interpretation is based on drilling and interpretation projections
from adjacent mapped areas.
- In areas where grade and geological continuity can be
demonstrated, but the geological data is limited to widely spaced
drilling only, the resource classification has been set to
inferred.
- Where insufficient intercepts are available to confirm
continuity of either grade or geology between holes, the model
cells have been flagged as ‘Not Classified’, and excluded from the
resource estimates.
- There is some scope for reinterpretation of Inferred material
geometry and considerable scope for alternate interpretation of Not
Classified portions of the model. It is expected that further
drilling will be required to improve the robustness of the
interpretation of these materials.
- A similar approach to resource modelling was used during the
Historical underground operations, and it was considered that the
reconciliation between mine and mill supported the classification
that had been assigned during this period.
- The geological model includes material that has been mined and
the lens models closely match the models generated by the mining
department during operation.
- Infill drill holes, drilled post the PEA study (Phase II, III
and IV drilling) to enable upgrading the classification for some of
the Inferred Resources to Indicated Resources, often intersected
mineralisation, faults and dolerites close to the expected location
indicated in the geology model. This indicates that the geology
model is reasonably robust in the areas drilled.
|
Dimensions |
- The Resource Model has 37 separate domains, 27 of which are
reported to contain either Measured and/or Indicated resources, and
a further 10 containing only Inferred resources above the modelled
cut-off grade of 7% Zn Equivalent Grade (ZnEq). Two lenses contain
low grade mineralisation below the reporting cut-off grade.
- The typical lens dimensions are 40 to 120m along strike,
approximately 80 to over 500m down plunge and 2 to 30m across
strike.
- Mineralisation has been modelled to a depth of 820m below
surface, however the deposit is considered to be open at
depth. The current Mineral Resource estimate is constrained
by the limited drill coverage below 700m.
|
Estimation and modelling techniques |
Modelling:
- All modelling of domains For the Feasibility Study were
completed using a combination of Micromine and Leapfrog modelling
software to generate domain wireframes. Mapping data was digitised
using Micromine. Flagged lens outlines from the mapping data and
drill hole pierce points were imported into Leapfrog where the
footwall and hanging wall of each lens were modelled using implicit
modelling routines appropriate for the geometry of the surface
being modelled. The completed wall wireframes were wire-framed
together in Micromine using appropriate geological constraints,
including faults, adjacent lens domains and Boolean mathematics to
build the final enclosed domain boundaries.
- The G lens mineralisation was modelled in a similar manner, but
using Leap Frog Geo software for all of the wire framing
requirements (due to advances in software).
- A regular block model was built using the lens boundaries and a
digital terrain model of the surface. Only the sulphide portion of
lenses has been domained and modelled. Waste material was not
subdivided into different geological units for this block model,
however a detailed wireframe model of geological units and faults
relevant to early mining phases has been developed.
- A parent cell size of 10m x 20m x 20m in the X, Y and Z
directions was chosen for the FS to reflect the principal mining
method of sub-level retreat long hole mining with paste fill. This
also reflects the drill hole intercept spacing of 20m x 20m for a
significant portion of the deposit.
- For the G lens model update and study was completed on the
sensitivity of block sizes for this more tightly drilled area of
the model (15x15m nominal spacing). The study indicated that at
this drill hole spacing either 5x5x5 or 10x10x10m block sizes would
be appropriate for resource estimation. 5x10x10m in the X, Y and Z
directions was chosen to reflect the sub-level retreat long hole
mining with paste fill mining method planned for these
lenses.
- The parent cells were sub-celled to 1m x 1m x 1m to accurately
estimate the volume of material inside each lens domain for mining
assessment.
Estimation of grades:
- Each individual lens was interpolated separately from other
lenses by the flagging of both drill hole assays and the block
model. Lens boundaries were treated as hard boundaries for the
purposes of modelling.
- For resource modelling purposes two adjustments were made to
assay data during modelling;
- Not all of historical samples had been routinely assayed for
Au. The detection limit of 0.01g/t has been applied to all absent
Au assays prior to compositing and interpolation.
- Fe assays were absent for a small number of holes in portions
of the I, K and D lenses. Appropriate Fe values were assigned to
the intervals based on nearby drill holes within the relevant
domains during compositing.
- Assays were selected and composited based on drill hole
flagging that was independent of the domain wireframe boundaries.
This technique was used to accommodate small differences in the
accuracy of drill hole sample locations relative to the underground
mapping data.
- No cut grades were required for assays except for the following
- Ag assays in the G1 domain, where a high- grade cut of 800 g/t
was applied to three samples in two adjacent holes.
- Due to the limited number of samples in each domain,
geostatistical modelling was carried out on all the domained assay
data simultaneously, to produce global semi-variogram models for
Au, Ag, Cu, Fe, Pb and Zn. These global geostatistical models were
considered to be robust for all elements modelled. They show good
continuity in general, with low nugget effects.
- No estimates of deleterious elements were carried out.
- Fe was estimated for all lenses to assist with the calculation
of density for the mineralisation by way or a regression equation
based on Fe, Zn and Pb grades.
- Grades were interpolated using Ordinary Kriging in Micromine
software, with Kriging parameters derived directly from the
semi-variogram models. Search parameters were based on the
variogram models with octant searches being used to set a maximum
of 32 samples for the initial search, and 16 and 4 for subsequent
searches. Search sizes were set to ensure all blocks were filled by
the third search and were orientated to match the variography. Only
blocks filled for all elements in the first search were considered
for Indicated or Measured classification.
- Although separate estimation parameters were used for each
element modelled there is good correlation between lead and zinc,
and moderate correlation between gold and silver. Copper was found
to have a somewhat shorter variogram range than the other elements
modelled. All element grades were broadly anisotropic and of
similar orientation and plunge to the lenses.
- The maximum range of extrapolation for inferred resources was
80m. Mineralisation estimates beyond this range were not classified
or reported.
- Zinc Equivalent Calculations
- ZnEq was calculated for each block from the estimated block
grades. The ZnEq calculation used to report the resource model is
the same as that used in the PEA to allow a direct comparison
between the two figures. The ZnEq calculation takes into
account, mining costs, milling costs, recoveries, payability
(including transport and refining charges) and metal prices in
generating a Zinc equivalent value for each block grade for Au, Ag,
Cu, Pb and Zn.
- ZnEq = Zn%+Cu%*3.12+Pb%*0.81+*Au g/t*0.86+Ag g/t*0.03
Metal prices used in the calculation are: Zn US$2,300/t, Pb US$
2,050/t, Cu US$6,600/t, Au US$1,250/oz and Ag US$18/oz. Metal
recoveries are provided in the section on metallurgy and it is
Heron’s view that all the metals within this formula are expected
to be recovered and sold.
- Validation of Estimates:
- The volumes of the block model were checked against the
calculated interior volumes of the wireframe models and found to be
reasonable for the level of confidence of the model.
- All domains were checked visually, individually by element for
assay composite grades against estimated block grades.
- 20m thick Swath plots in the vertical plane, north-south plane
and east-west plane were produced for all lenses, comparing drill
hole composite grades with block modelled grades. No significant
departures in grades were noted for material classified as Measured
or Indicated. Some differences in the mean and smoothing were
detected for lens models that contained a significant portion of
Inferred resources. This was deemed acceptable for the level of
confidence assigned.
- Reconciliation of historical mine claim production records
(where recorded in sufficient detail) to the block model were
acceptable, with all Measured and most Indicated portions of the
model accurately predicting both grade and tonnes mined to ±10% or
better.
|
Moisture |
- All estimates were based on dry density. The rock mass is
non-porous fresh rock and contains little residual moisture, except
along major fault planes (less than 0.01% of the rock mass).
|
Cut-off parameters |
- A ZnEq cut-off grade of 7% minimum was applied to report
Mineral Resources. This cut-off grade was based on the likely
foreseeable minimum grade required for underground mining at the
Woodlawn mine site. The ZnEq equation is the same as that used in
the PEA study. It is not necessarily related to the FS or later
reserve mining study economic assessments, which take into account
more up to date prices and metallurgical performance. That being
said, the 7% cut-off is not materially different to the results of
the FS mining study cut-off grades.
- The copper domains are reported at a 1% Cu cut off grade, which
reflects the reduced processing costs and recovery factors for
copper only mineralisation based on metallurgical test work.
|
Mining factors or assumptions |
- Dilution factors have not been applied to the Mineral Resource
estimate.
- The deposit has previously been mined both as an open cut pit,
and an underground mine. Open cut mining has not been considered
for the Mineral Resource at this time.
- It is assumed that underground mechanised mining will be used
to mine the deposit in the future.
- The Indicated and Measured portions of the resource model was
assessed for underground mining as a part of the FS. Assessment was
carried out by SRK mining engineers in conjunction with Beck
geotechnical engineers.
- The study included both capital and operating underground
mining costs, based on a contract mining scenario with trackless
mining equipment and employing primarily long-hole stoping and
paste backfill. Other considerations included the presence of
existing historical underground development openings, filled and
unfilled historical stopes, as well as the ongoing use of the open
cut by Veolia.
- The mine design included new box-cut and decline access,
ventilation design, escape-way design, ground support requirements,
stockpiles and cross-cuts, as well as level development and stoping
designs.
- The size of stopes, mining methods and dilution parameters are
based on historical mining performance and geotechnical assessment
of recent drilling, applied to the mining methods chosen by the
study.
- The mining study is a thorough study of mining inventory to a
FS level.
- Material assessed to be inaccessible or unrecoverable by
underground mining during the FS were excluded from the Mineral
Resource estimate and not reported. This includes material in
non-recoverable pillars, the edge of previously mined stopes and
areas of known collapse in the mining records from the previous
underground mine.
|
Metallurgical factors or assumptions |
- The deposit was previously mined and processed to produce
saleable and profitable metal concentrates for copper, lead and
zinc.
- Recent metallurgical test work by Heron on underground
mineralisation intercepts, including material representing mining
dilution, as a part of the FS indicates that good recoveries of
saleable concentrates can be achieved for copper, lead and zinc
concentrates from both the underground mineralisation, and tailings
stored on site from previous mining operations.
- The test work was based on crushing and grinding underground
mineralisation to 75μm, floating of a copper concentrate with
separate talc pre-float, then regrinding the material to 30μm with
separate talc pre-float, copper, lead, and zinc concentrate
floats.
- Test work included the classification of tailings to produce
material suitable for use as a paste fill in underground
voids.
- Detailed work on the proposed metallurgical processing of the
deposit, including estimated capital and operating costs, and plant
preliminary designs, metal recoveries, concentrate grades and
payabilities can be found in the body of the FS
document.
|
Environmental factors or assumptions |
- The site has been subject to previous mining activities, and
has not been fully rehabilitated.
- On July 4th, 2013 the Company received project approval under
Section 75J of the EP&A Act from the NSW Minister of Planning
and Infrastructure in relation to the project, covering both:
- The Woodlawn Retreatment Project (WRP) — involving the
establishment of a hard-rock processing facility and the processing
of existing tailings material stored within three existing tailings
dams; and
- The Woodlawn Underground Project (WUP) — involving excavation
of a new box-cut and underground mining development to extract
metalliferous sulphide material, subject to successful
exploration.
- The approvals have been granted to allow mining operations at
the Woodlawn site until 31st December 2034.
- The approvals come with a number of reasonable, workable
operating conditions relating to hours of operations, operating
standards, community consultation, conditions on site operations
and restrictions on volumes and transport routes approved.
- Aside from the conditions the Company has designed a new
tailings dam, and will be implementing a water management system
(to ensure zero discharge of contaminated water off site). The
company is also obliged to identify and implement a passive system
for the treatment of potential acid forming seepage from the
existing waste dump, refurbish, monitor and maintain the existing
bore fields.
- Further environmental details can be found in the body of the
FS document.
|
Bulk density |
- No verifiable historical density data has been located,
although the taking of density measurements is mentioned in a
number of historical resource reports. Earlier resource
estimates used formulae similar to the one shown below to calculate
densities. Historically, a default density of 3.9 t/m3 was
used for polymetallic ore and 2.9 t/m3 for copper only
mineralisation.
- Bulk densities were determined for all Heron samples by the wet
weight/dry weight method on site, by suitably trained personnel. As
the mineralisation is hosted wholly in non-porous fresh rock, it is
reasonable to expect that dry density and bulk density of material
are similar.
- Dry density for each block was determined via a historical
regression equation based on the following formula for all
polymetallic lenses.
Dry Density = 2.2118 +Fe%*0.0552 + Zn%*0,0226 + Pb%*0.0487
- For Copper lenses the polymetallic equation was found to
underestimate density, and a new regression equation specific to
copper domains was developed
Dry Density = 2.5479 + Fe%*0.0267 + Fe%2 * 0.0005
- The performance of the two regression equations against
measured densities was validated by Heron and found to be
sufficiently accurate for the purpose of the Mineral Resource
estimate with the application of a lower limit to the
regression.
- All densities below 2.70 were assigned a density of 2.70; this
being the average value of non-mineralised measured densities from
the recent Heron drilling.
- Waste was also assigned a density of 2.70, based on recent
sampling and density work carried out by Heron.
- More detail on the examination and adjustments of density can
be found in the FS report.
|
Classification |
- The resource classification was based on the findings from both
geological and mining engineering assessments.
- Geological Criteria;
- Measured Mineral Resource classifications were applied where
the geological confidence in the definition of controlling
geological structures was robust, the drill spacing was generally
20m x 20m or less, and Kriging parameters indicated a high level of
confidence in the interpolation. In the majority of cases Measured
resources were supported by both underground geological mapping and
drill hole data and represent recoverable sill pillars and remnants
from previous mining operations.
- Indicated Mineral Resource classifications were applied where
the geological confidence in the definition of controlling
geological structures was robust, the drill spacing was between 15m
x 20m and 40m x 40m depending on individual lens characteristics,
and Kriging parameters indicated a high level of confidence in the
interpolation. In the majority of cases Indicated resources were
supported by well correlated drill hole data in areas not
previously mined, or a mixture of geological mapping and drilling
in areas previously mined.
- Inferred Mineral Resource classification was applied to areas
where geological and grade continuity was proven by adjacent drill
holes, and projection of geological data could be used to apply
reasonable geological structural controls to the extents of
mineralisation. Drill hole spacing was usually 80m x 80m or less
for this domain, and included both lens extensions and lenses
previously not modelled, and was usually based on drill hole
intercepts with projected geological interpretations from mapped
areas.
- Areas of poor geological confidence, or limited sampling,
whilst modelled, were not classified and have not been
reported.
- Engineering Criteria;
- As a part of the PEA Heron completely remodelled the existing
underground voids from the source survey data for the entire mine.
This included making adjustments to the void model to reflect the
shanty-back profiles of the cut-and-fill jumbo stoping used in much
of the historical mine stoping. No resources were reported from
within the modelled voids in the FS.
- Areas adjacent to, and directly below existing historical
stopes were excluded from classification as it was considered
unlikely that this in-situ material could be recovered safely from
the deposit. All stope skins were treated in this manner.
- Areas in and around known zones of collapse in the previous
mine were also not classified or reported.
- Areas where mining recovery was considered uncertain, but may
be possible, pending underground access and assessment, have been
left classified as Mineral Resources, although some may not be
included in the Mineral Reserve.
- Estimated resource blocks below the likely future minimum
mining grade of 7% ZnEq for polymetallic domains, or 1% Cu for
copper domains were also removed from the resource inventory by the
application of a low grade cut to reported blocks.
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Audits or reviews |
- Review of the Mineral Resource estimates have been carried out
SRK Consulting. This included the following steps:
- Regular discussions with Heron’s Senior Resource Geologist
during the building of the geological model.
- Visual examination of the final geological model against
existing drill hole and mapping data
- Variography of the major elements: Zn, Cu, Pb, Ag, Au and Fe,
as described in a previous paragraph
- Review of the kriging parameters used by Heron
- Review of the resulting block model sizing used by Heron
(Visually and statistically)
- Review of the quality of the estimation through an evaluation
of kriging quality parameters (slope of regression and kriging
efficiency)
- Review of the classification criteria and results.
- The overall conclusion of the review is that the model and
resource estimates are sound, based on a thorough analysis of the
geology and the data. If anything, the results are
conservative, as a number of zones are eliminated from the
resources based on fairly strict criteria of confidence in the
geology, data density and mineability.
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Discussion of relative accuracy confidence |
- The Competent Person has a relatively high confidence in the
Mineral Resource estimate
- The principal reasons are:
- Underground backs mapping data has been digitised and used to
develop a geological frame work for the Mineral Resource estimate
which is inclusive of all geological observations made during
previous mining of the deposit.
- Lenses have been modelled on an individual basis, with a clear
separation of the principal mineralisation styles within each lens.
Interpretation of lens volumes and location directly incorporates
underground mapping data, where available, significantly increasing
the confidence in the geological model and the Mineral Resource
estimate.
- The modelling of the variography is sound and interpolation of
the deposit using ordinary kriging is a robust and proven method
for modelling this style of deposit. The method is employed to
model other similar deposits, including current producing
mines.
- Because the quality of the variograms is generally very good,
showing good grade continuity (low nugget effect, ranges varying
between 25 and 100 m), the quality of estimation as quantified by
indicators such as the slope of regression and the kriging
efficiency is good. As expected, blocks classified as
Indicated show better quality indices in general than Inferred
blocks.
- The resource estimates have been prepared and classified in
accordance with the guidelines that accompany the JORC Code, and no
attempts have been made to further quantify the uncertainty in the
estimates.
- The void model has been completely remodelled from original
source data, significantly increasing the confidence in the
location of remaining unmined material.
- The Mineral Resource quantities should be considered as global
and regional estimates only. The accompanying models are
considered suitable to support mining planning studies, but not
considered suitable for production planning, or studies that place
significant reliance on the accuracy of the local estimates.
- The deposit remains open at depth and along strike.
- No recent production data exists to verify the accuracy of the
resource estimate as the deposit is currently not being mined.
Historical production figures are of a similar grade to the diluted
resource model in areas which have been previously mined, and
specific production records exist.
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For further information, please visit www.heronresources.com.au or contact:
Australia:
Mr Wayne Taylor
Managing Director and Chief Executive Officer
Tel: +61 2 9119 8111 or +61 8 6500 9200
Email: heron@heronresources.com.au
Canada:
Tel: +1 647-862-1157 (Toronto)