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Mt Gunson Project

Mt Gunson Project

Mt Gunson ProjectThe Mt Gunson Project is a farm-in and joint venture between Gindalbie Metals and Terrace Mining.

Location

The Mt Gunson Project is centred approximately 35 km south-east of Woomera and 135 km north-west of Port Augusta in South Australia. The project currently covers 824 km2 in the Olympic Dam Copper Province, Australia’s most productive copper belt. The project is located 100 km south of BHP Billiton’s Olympic Dam copper-gold-uranium mine and 50 km west of OZ Minerals’ Carrapateena copper-gold project.

The project mining centre lies 10 km off the sealed Stuart Highway and is accessed by established unsealed roads. Established access to electrical grid power and scheme water is available in the area. The Adelaide to Perth/Darwin railway runs parallel to the Stuart Highway. Additionally, regular air services are available at Roxy Downs and Port Augusta, and a serviceable airstrip for light aircraft is located on site. Accommodation is available at Woomera. 

Geology

The MG14 (1) and Windabout (2) copper-cobalt deposits at Mt Gunson, are hosted by flat-lying undeformed sedimentary rocks (surface proximity) of Late Proterozoic Age, deposited on the Stuart Shelf. These platform sediments are referred to as the ‘Cover Sequence’ and unconformably overlie complexly deformed and metamorphosed igneous rocks of the eastern margin of the Archaean Gawler Craton.

The main mineralisation occurs as well-defined zones at the top of the host Tapley Hill Formation (THF). The THF appears to have been deposited in shallow basin-like structures elongated along a north-west to south-east trend. Elevated base metal values (copper, lead and zinc) occur throughout the unit. The copper-cobalt mineral deposits are composed of sediment-hosted fine grained sulphides and a stratiform in style.

Mineral Resources

The currently contemplated mining strategy for MG14 and Windabout mineral deposits is based on the shallow depth, free dig overburden, and their sheet-like and sub-horizontal structure. The MG14 orebody would likely be mined first due to its higher grades and shallow depth while Windabout, with a lower head grade, longer life, and higher stripping ratio would likely be mined subsequently.

The MG14 deposit is a concealed, flat lying body of disseminated copper sulphide mineralisation at 25m depth. It is oriented east-west and is approximately 1,400 m long by 400 m wide with a varying thickness between 3 to 8 m. A JORC 2012 compliant resource was estimated by T. Callaghan in June 2013 with a cut-off grade of 0.5% Cu and an average specific gravity of 2.5. 

The Windabout deposit is similar in style to MG14 with copper sulphide mineralisation dipping approximately 5° to the north-east and varying in depth from 55m to 80m. The deposit is elongated east-west and is approximately 2,000 m long by 1,000m wide with varying thickness between 3 to 8 metres. 

Competent Person Statement for JORC 2012 Mineral Resource 

Information in this announcement relating to the MG14 Resource is based on data compiled by Mr Tim Callaghan who is a member of The Australasian Institute of Mining and Metallurgy and the Australian Institute of Geoscientists. Mr Callaghan has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Person under the 2012 Edition of the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Callaghan consents to the inclusion of the data in the form and context in which it appears. 

The MG14 Mineral Resource at the Mount Gunson Copper-Cobalt Project has been estimated by Mr Tim Callaghan, an external consultant, and is reported under the 2012 Edition of the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves (see Strandline Resources-ASX announcement 30th September 2015 titled: Annual Report). 

MG14 was first disclosed under the JORC Code 2012. Whilst Gindalbie has completed appropriate verification of the MG14 Resources for farm-in acquisition due diligence requirements, the study is not yet sufficiently advanced to report a Table 1 for JORC Code 2012 reporting. It is uncertain whether following evaluation and further work that these estimates will be able to be reported as mineral resources in accordance with the JORC 2012 code.

The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements and, in the case of estimates of Mineral Resources that all material assumptions and technical parameters underpinning the estimate in the relevant market announcement continue to apply and have not materially changed. The company confirms that the form and context in which the Competent Person’s findings are presented have not materially modified from the original market announcements. 

Competent Person Statement for JORC 2004 Mineral Resource

Information in this announcement relating to the Windabout Resource is based on data compiled by Ms Felicity Hughes who is a member of The Australasian Institute of Mining and Metallurgy (Member No 106498). Ms Hughes has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Person under the 2004 Edition of the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves. Ms Hughes consents to the inclusion of the data in the form and context in which it appears. 

The Windabout 2004 JORC Resource at the Mount Gunson Copper-Cobalt Project has been estimated by Ms Hughes, an external consultant, and is reported under the 2004 Edition of the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves (see Strandline Resources-ASX announcement 30th September 2015 titled: Annual Report). It has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported. The company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements and, in the case of estimates of Mineral Resources that all material assumptions and technical parameters underpinning the estimate in the relevant market announcement continue to apply and have not materially changed. The company confirms that the form and context in which the Competent Person’s findings are presented have not materially modified from the original market announcements. 

Mt Gunson mineral resource estimates

[1] Strandline Resources Limited (ASX: STA)'s Annual Report 2015 dated 30 September 2015 for the MG14 Resources was prepared and first disclosed under the JORC Code 2012. Whilst Gindalbie has completed appropriate verification of the MG14 Resources for farm-in acquisition due diligence requirements, the study is not yet sufficiently advanced to report a Table 1 for JORC Code 2012 reporting. Gindalbie will continue the necessary work required to provide a 2012 JORC Code Resource Statement to the market and expects to complete and publish this resource statement in the near term.

[2] Strandline Resources Limited (ASX: STA)'s Annual Report 2015 dated 30 September 2015 for the Windabout Resources was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported. The resource reviews for the Windabout Resource were completed in 1995 and 1996 based on 197 drill holes. The previous tenement holder engaged T Callaghan in 2009 to review the Mineral Resource. The Mineral Resource has subsequently been assigned a JORC indicated 2004 resource.

The Windabout Historical Resource estimates are not in compliance with the JORC 2012 code due to the age of the drilling upon which the Estimates were based. The estimates are considered relevant and material to Gindalbie due to the high proportion of total Resources within the project area currently categorised as historical Resources. Gindalbie will fund work during Stage 1 to provide more certainty of the grade and size of the Windabout deposit primarily through updated QA/QC procedures, derived from a planned drilling program to obtain additional metallurgical samples, and mining and Resource data for Resource modelling. At this stage, no competent person has done sufficient work to classify these historical estimates in accordance with the JORC Code 2012. It is uncertain whether following evaluation and further work that these estimates will be able to be reported as mineral resources in accordance with the JORC 2012 code.