AZOD Resources and Reserves

View the AZOD Project Pre-Feasibility Study Technical Report

Accha and Yanque – Calculated Mineral Resources

Accha Deposit Mineral Resource Estimate Showing Sensitivity of the Estimate to Cut-off Grades (Base Case is highlighted)

Mineral Resources Amenable to Open Pit Mining Methods

Category

ZnEq Cut-Off (%)

Tonnage
(kt)

ZnEq
(%)

Zn
(%)

Pb
(%)

Contained ZnEq
(Mlb)

Contained Zn
(Mlb)

Contained Pb
(Mlb)

Measured

2.20

2,119

8.75

8.11

0.93

408.8

378.9

43.4

 

3.00

1,983

9.17

8.49

0.97

400.7

371.4

42.6

 

4.00

1,751

9.91

9.18

1.06

382.6

354.4

40.9

 

5.00

1,527

10.71

9.91

1.16

360.4

333.5

38.9

Indicated

2.20

4,494

6.03

5.55

0.71

597.4

549.9

70.3

 

3.00

3,700

6.77

6.23

0.79

552.5

507.9

64.6

 

4.00

2,916

7.66

7.04

0.89

492.2

452.8

57.1

 

5.00

2,286

8.53

7.85

0.98

429.9

395.8

49.4

M & I

2.20

6,613

6.90

6.37

0.78

1,006.0

928.7

113.7

 

3.00

5,683

7.61

7.02

0.86

953.2

879.3

107.2

 

4.00

4,667

8.50

7.85

0.95

874.8

807.2

98.0

 

5.00

3,813

9.40

8.68

1.05

790.3

729.4

88.3

Inferred

2.20

197

4.95

4.60

0.51

21.5

20.0

2.2

 

3.00

151

5.66

5.25

0.60

18.8

17.5

2.0

 

4.00

124

6.13

5.69

0.64

16.8

15.6

1.7

 

5.00

89

6.77

6.29

0.69

13.3

12.3

1.4

 

Accha Deposit Mineral Resources Amenable to Underground Mining Methods

Category

ZnEq Cut-Off (%)

Tonnage
(kt)

ZnEq
(%)

Zn
(%)

Pb
(%)

Contained ZnEq
(Mlb)

Contained Zn
(Mlb)

Contained Pb
(Mlb)

Measured

3.79

17

5.73

4.58

1.66

2.1

1.7

0.6

 

4.00

17

5.74

4.60

1.66

2.2

1.7

0.6

 

5.00

12

6.24

5.06

1.72

1.7

1.3

0.5

Indicated

3.79

920

6.24

5.58

0.95

126.5

113.3

19.2

 

4.00

840

6.46

5.79

0.98

119.6

107.1

18.1

 

5.00

554

7.49

6.72

1.12

91.4

82.0

13.6

M & I

3.79

937

6.23

5.57

0.96

128.6

115.0

19.8

 

4.00

857

6.45

5.76

0.99

121.8

108.9

18.7

 

5.00

566

7.46

6.68

1.13

93.1

83.4

14.1

Inferred

3.79

553

5.63

5.07

0.81

68.6

61.8

9.9

 

4.00

514

5.76

5.19

0.82

65.3

58.8

9.3

 

5.00

277

6.95

6.34

0.90

42.5

38.7

5.5

  1. Mineral Resources have an effective date of 5 July 2013. The Mineral Resource estimates and geological models were prepared by Christopher Wright, P.Geo. of AMEC and reviewed by Stella Searston, RM SME of AMEC who is the Qualified Person as defined under NI 43-101 for the estimate.
  2. Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
  3. The estimate uses Ordinary Kriging as the interpolation method in a percent block model with a block size of 5x5x5 m. Density utilized in the mineral resource estimates was 2.51 t/m3 for mineralization and 2.57 t/m3 for waste.
  4. Mineral Resources are estimated using a conceptual Lerchs-Grossmann pit shell and conceptual stope outlines that assumed a US$1.28 lb zinc price, a US$1.05/lb lead price, marketing treatment, and refining costs of US$0.201/lb for zinc and US$0.289/lb for lead, metallurgical recovery of 86.9% for zinc and 97.7% for lead, a mining cost of US$2.09/t for open pit and of US$34.92/t for underground mining, and processing, general and administrative costs of US$48.15/t
  5. Overall slope angle for the Accha open pit is 33o
  6. Mineral Resources are reported above a marginal cut-off grade of 2.20% ZnEq. for the open pit estimate. Underground Mineral Resources are reported above a cut-off grade of 2.20% ZnEq, below the resource pit shell and within conceptual stope outlines defined at a break-even cut-off grade of 3.79% ZnEq. Zinc equivalent (ZnEq) was calculated by applying the differential of metallurgical recoveries and metal prices net of selling costs to zinc and lead grades.
  7. Contained zinc and contained lead represent estimated metal contained in the ground and have not been adjusted for metallurgical or other recovery factors
  8. The metal prices used for the Mineral Resources estimates are based on a combination of AMEC`s internal guidelines (based on long-term consensus prices) and those sourced from Wood Mackenzie and the World Bank. It is industry practice to apply higher long-term metal prices used for Mineral Resources than that used for Mineral Reserves
  9. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content.

Yanque Deposit Mineral Resource Estimate Showing Sensitivity of the Estimate to Cut-off Grades (Base Case is highlighted)

Mineral Resources Amenable to Open Pit Mining Methods

Category

ZnEq Cut-Off (%)

Tonnage
(kt)

ZnEq
(%)

Zn
(%)

Pb
(%)

Contained ZnEq
(Mlb)

Contained Zn
(Mlb)

Contained Pb
(Mlb)

Indicated

1.67

26,491

3.87

2.37

2.18

2,261.5

1,385.3

1,270.0

 

2.00

23,242

4.16

2.55

2.33

2,129.9

1,306.7

1,193.1

 

4.00

8,701

6.34

4.05

3.32

1,216.0

777.4

635.7

Inferred

1.67

1,169

2.91

2.17

1.09

75.1

55.8

28.0

 

2.00

1,081

3.00

2.24

1.11

71.5

53.3

26.3

 

4.00

20

5.21

3.32

2.75

2.3

1.5

1.2

  1. Mineral Resources have an effective date of 5 July 2013. The Mineral Resource estimates and geological models were prepared by Christopher Wright, P.Geo. of AMEC and reviewed by Stella Searston, RM SME of AMEC who is the Qualified Person as defined under NI 43-101 for the estimate.
  2. Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
  3. The estimate used Ordinary Kriging as the interpolation method in a percent block model with a block size of 5x5x5 m. The density utilized in the mineral resource estimates was 2.37 t/m3 for mineralized material and 2.49 t/m3 for waste.
  4. Mineral Resources are confined within a conceptual Lerchs–Grossmann pit shell and are estimated using a US$1.28/lb zinc price, a US$1.05/lb lead price, overall pit slope angles of 40º, metallurgical recovery of 86.9% for zinc and 97.7% for lead, a mining cost of US$1.89/t, zinc premium of 5%, lead payability of 94.1%, marketing, treatment and refining costs of US$0.201/lb for zinc and US$0.289/lb for lead, and processing, general and administrative costs of US$36.66/t. Zinc equivalent (ZnEq) was calculated by applying the differential of metallurgical recoveries and metal prices net of selling costs to zinc and lead grades.
  5. Contained zinc and contained lead represent estimated metal contained in the ground and have not been adjusted for metallurgical or other recovery factors.
  6. The metal prices used for the Mineral Resources estimates are based on a combination of AMEC`s internal guidelines (based on long-term consensus prices) and those sourced from Wood Mackenzie and the World Bank. It is industry practice to apply higher long-term metal prices used for Mineral Resources than that used for Mineral Reserves.
  7. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content.

Accha and Yanque – Calculated Mineral Reserves

Mineral Reserves Statement assuming Base Case, Effective Date July 11, 2013

Category

Tonnes
(kt)

Zn Grade
(%)

Pb Grade
(%)

Zn
(Mlb)

Pb
(Mlb)

Accha Open Pit

 

 

 

 

 

  Proven

754

8.43

0.73

140.2

12.2

  Probable

468

7.39

0.59

76.3

6.1

  Proven & Probable

1,223

8.03

0.68

216.5

18.3

Accha Underground

 

 

 

 

 

  Proven

307

11.79

1.70

79.8

11.5

  Probable

704

9.74

1.25

151.3

19.4

  Proven & Probable

1,011

10.36

1.39

231.1

30.9

Yanque Open Pit

 

 

 

 

 

  Proven

0

0.00

0.00

0.0

0.0

  Probable

8,338

3.97

2.60

730.5

477.1

  Proven & Probable

8,338

3.97

2.60

730.5

477.1

TOTAL – Accha & Yanque

 

 

 

 

 

  Proven

1,061

9.40

1.01

219.9

23.7

  Probable

9,510

4.57

2.40

958.0

502.5

TOTAL Accha & Yanque Proven & Probable

10,571

5.05

2.26

1,177.9

526.2

  1. Mineral Reserve estimates have an effective date of 11 July 2013. The Mineral Reserves estimates assuming open pit mining methods were prepared by Sergio Muñoz, Senior Mining Eng., RM Comisión Minera (Chile) of AMEC, and by William Bagnell P.Eng. of AMEC for the estimates assuming underground mining methods.
  2. Mineral Reserves are estimated using the following assumptions: a US$1.03/lb zinc price, a US$0.95/lb lead price, and an economic function that includes an average processing, G&A, and ore haulage costs of US$60.59/t in Accha and US$37.50/t in Yanque and, marketing, treatment and refining costs of US$0.201/lb for zinc and US$0.289/lb for lead, a zinc premium of 5%, a lead payability of 94.1%, and metallurgical recoveries for zinc of 89.6% in Accha and 86.9% in Yanque, and lead recoveries of 97% in Accha and 97.7% in Yanque. Open pit mine designs assumed average inter-ramp pit slope angles of 37° and 46° for Accha and Yanque respectively.
  3. The open pit referential cut-off grades for Accha are 3.5% Zn and for Yanque are 2.2% Zn. The referential cut-off grade for underground is 6.0% Zn
  4. The projected life-of-mine strip ratio for the Accha pit is 3.32 and for the Yanque pit is 1.36
  5. The metal prices used for the Mineral Reserves estimates are based on AMEC`s internal guidelines (which are based on long-term consensus prices)
  6. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content.

Mineral Reserves Statement assuming Fume Case, Effective Date July 11, 2013

Category

Tonnes
(kt)

Zn Grade
(%)

Pb Grade
(%)

Zn
(Mlb)

Pb
(Mlb)

Accha Open Pit

 

 

 

 

 

  Proven

651

9.26

0.80

132.9

11.4

  Probable

388

8.26

0.66

70.7

5.6

  Proven & Probable

1,039

8.88

0.74

203.5

17.1

Accha Underground

 

 

 

 

 

  Proven

237

13.78

1.97

71.9

10.3

  Probable

547

11.17

1.43

134.6

17.2

  Proven & Probable

783

11.96

1.59

206.5

27.5

Yanque Open Pit

 

 

 

 

 

  Proven

0

0.00

0.00

0.0

0.0

  Probable

9,711

3.57

2.86

763.3

611.5

  Proven & Probable

9,711

3.57

2.86

763.3

611.5

TOTAL – Accha & Yanque

 

 

 

 

 

  Proven

888

10.46

1.11

204.8

21.7

  Probable

10,646

4.13

2.70

968.5

634.4

TOTAL Accha & Yanque Proven & Probable

11,533

4.61

2.58

1,173.3

656.1

  1. Mineral Reserve estimates have an effective date of 11 July 2013. The Mineral Reserves estimates assuming open pit mining methods were prepared by Sergio Muñoz, Senior Mining Eng., RM Comisión Minera (Chile) of AMEC by William Bagnell P.Eng. of AMEC (for the estimates assuming underground mining methods
  2. Mineral Reserves are estimated using the following assumptions: a US$1.03/lb zinc price, a US$0.95/lb lead price, and an economic function that include an average processing, G&A ore haulage of US$60.12/t in Accha and US$36.80/t in Yanque, marketing, treatment and refining cost of US$0.290/lb for zinc and US$0.190/lb for lead, zinc payability of 79.4%, lead payability of 89%, and metallurgical recoveries for zinc of 91% in Yanque and 93.8% in Accha, and lead recoveries of 97.7% in Yanque and 97% in Accha. A percent model was used with a blocks size of 5x5x5 m. Open pit mine designs assumed average inter-ramp pit slope angles of 37° and 46° for Accha and Yanque respectively
  3. The life-of-mine strip ratio for the Accha pit is 4.08 and for the Yanque pit is 1.36
  4. The Fume Case open pit referential cut-off grades for Accha are 5.5% Zn, and for Yanque are 2.9% Zn. The cut-off grade for Accha underground is 8.6% Zn
  5. The metal prices used for the Mineral Reserves estimates are based on AMEC`s internal guidelines (based on long-term consensus prices)
  6. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content

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