Option agreement with Randgold set to commercialise Massigui Gold Project
v Option agreement with the Morila mine-operator provides potential low risk and low cost processing solution for Massigui gold deposits
v Morila operator Randgold brings substantial development, mining and processing expertise to further evaluate and optimally exploit potential resources
v Morila to fully fund further feasibility work and mine permitting studies over defined Area of Interest
v Significant exploration upside
v Birimian retains 100% rights for exploration over broader project area
Birimian Limited (ASX:BGS; “Birimian” and “Company” - https://www.youtube.com/watch?v=2g4bWv1edrw ) advises that it has entered into an agreement with Societe de Mines de Morila (“Morila”) that could lead to the commercialisation of several of its gold deposits within its Massigui Gold Project in Southern Mali.
This agreement provides a potential low risk, low cost processing solution for these deposits, whilst the Company retains the significant upside potential for further gold discoveries on the broader project area.
Under the terms of the agreement, Morila have been granted a six month option to acquire an Area of Interest within the Project. Upon exercise, Morila will make a payment of $1,000,000 and Birimian will retain a royalty of up to 4% of gold produced from the Area of Interest.
The Massigui Gold Project surrounds the Morila mine lease on three sides and covers strike extensions of the highly prospective geological sequence that hosts the 7Moz Morila Gold Deposit (Figure 1).
Birimian has made significant gold discoveries at three prospects, namely Ntiola, Viper and Koting. These prospects are situated in close proximity to the north-west of the underutilised 4 million tonnes per annum Morila Mine Treatment Plant. Over 35,000 metres of drilling has been completed on the project to date.
The Morila Gold Mine is managed by Societe de Mines De Morila, a Joint Venture between operator Randgold Resources, Anglogold Ashanti, and the Republic of Mali. Commencing production in 2000, the mine has since produced in excess of 7Moz of gold. The project has now largely exhausted existing ore sources and will be reconfigured to process tails.
The Area of Interest (see Figure 1) comprises 11km2 and covers the gold deposits at Ntiola and Viper. The balance of the project area (~740km2) is controlled 100% by Birimian. The early stage, high potential, Koting Prospect and other highly prospective areas are not included within the Area of Interest. The Company intends to undertake further low cost exploration and drilling activities at these locations.
Figure 1. Massigui Gold Project. Randgold-Morila Area of Interest shown in red.
Terms of Agreement
Birimian has granted Morila a six month option to acquire a 100% interest in the Area of Interest for a total option fee of $100,000. Subject to exercise of the option the general terms of the agreement are;
1. Morila will make a payment of $1,000,000, and
2. Pay a royalty on gold produced based on the prevailing gold price as follows;
During the option period Morila may, at its sole discretion, undertake any evaluations, including drilling, within the defined area. Morila may elect to exercise its option at any time during the option period. Scheduling of any eventual mining from the Area of Interest is at the sole discretion of Morila.
Massigui Gold Project
Birimian’s targeted drilling programs have resulted in significant gold discoveries at Ntiola, Viper and Koting Prospects; situated approximately 25km to the north-west of the underutilised Morila Mine Treatment Plant.
The deposits at Ntiola and Viper are subject to the Morila option agreement. Based on the current drilling at Ntiola and Viper an Exploration Target is estimated in the range of 4 million to 6 million tonnes grading approximately 1.2 – 1.8g/t Au.
The Exploration Target is reported in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (2012 Edition). The potential quantity and grade of this Exploration Target is conceptual in nature. There has been insufficient exploration drilling to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource.
Further drilling and evaluation studies are required to adequately define any potential mineable resources at these prospects. Preliminary studies undertaken by Birimian suggest that significant portions of these zones could be amenable to open pit mining and processing by conventional carbon-in-leach techniques. The agreement with Morila brings substantial development, mining and processing expertise to further evaluate and optimally exploit any potential resources.
Basis of Exploration Target
A substantial amount of drilling has been undertaken at Ntiola and Viper, however the current drill coverage is of insufficient density and distribution to classify Mineral Resources in accordance with the JORC Code (2012 Edition).
At Ntiola, RC and diamond drilling has defined a robust gold mineralised zone 600 metres long, averaging 25m wide, and to a depth of 150 metres. In total, 90 drill holes for 9,456m of drilling have been completed at the prospect. This dataset was utilised to construct a geological model for the drill defined zone from which tonnage ranges have been estimated (Figure 2). Geostatistical interpolation (ordinary kriging) and raw statistical techniques were applied to determine gold grade ranges within the model.
At Viper Prospect, multiple phases of RC and AC drilling have confirmed the presence of geologically continuous zones of gold mineralisation extending over in excess of 1km of strike and hosting multiple higher grade gold shoots (Figure 2). In total 3,842m of drilling has been completed at Viper. At present, drill sections are nominally spaced between 50m and 100m apart over mineralisation. RC Drilling has tested the shallow, generally oxide, portion of the mineralised zone to a depth of approximately 50 metres vertical.
The consistent and predictable geometry of mineralisation at Viper Prospect has enabled the construction of a geological model from which tonnage ranges have been estimated. Geostatistical interpolation and raw statistical techniques were applied to determine gold grade ranges within the model. Diamond drilling has confirmed excellent continuity of the mineralised zone at depth and provides the confidence to extend the current exploration target down dip to 75m vertical from surface.
There is significant potential for further gold discoveries at the Massigui Project. Birimian expects that further exploration targeting areas outside the Morila Area of Interest would be funded at an appropriate time by cash flow from mining.
Very limited drilling at Koting Prospect has returned ore grade intersections over very broad widths (Figure 3). The scale and tenor of the mineralisation identified in drilling suggests there is excellent scope to define considerable new gold resources within the prospect area.
Highly significant, shallow (oxide), ore-grade drill intersections also occur at other prospects, including at Kondji (11m @ 2.53 g/t Au), and at Koble (12m @ 2.49 g/t Au)
To date, follow up drilling at these prospects has been broadly spaced and there remains good potential for additional discoveries at these locations. In addition to these known prospect areas, the Company is confident its new prospect development and project generation activities will continue to deliver high potential resource targets within the broader Massigui Project area.
For further information contact:
Mr Kevin Joyce
08 9286 3045
Swiss Resource Capital AG
Competent Persons Declaration
The information in this announcement that relates to exploration results and the Exploration Target is based on information compiled by or under the supervision of Kevin Anthony Joyce. Mr Joyce is Managing Director of Birimian Limited and a Member of the Australian Institute of Geoscientists. Mr Joyce has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and the activity he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results. Mr Joyce consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
Previous Reported Results
There is information in this announcement relating to previous Exploration Results at the Massigui Project. The Company confirms that it is not aware of any other new information or data that materially affects the information included in the original market announcement, and that all material assumptions and technical parameters have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.
Forward Looking Statements
Statements regarding plans with respect to the Company’s mineral properties are forward looking statements. There can be no assurance that the Company’s plans for development of its mineral properties will proceed as expected. There can be no assurance that the Company will be able to confirm the presence of mineral deposits, that any mineralisation will prove to be economic or that a mine will successfully be developed on any of the Company’s mineral properties.
Basis of Exploration Target
The Exploration Target at Massigui is estimated in the range of 4Mt to 6Mt at grades between 1.2 and 1.8g/t Au. The deposits have been drilled to nominal 50m x 50m hole spacing,with some sections spaced 100m apart at Viper. The Exploration Target is estimated to a vertical depth of 150m at Ntiola and 75m at Viper. Upper and lower gold ranges have been determined from raw composite and ordinary kriged (OK) block modelled data. Tonnage ranges have been determined from the volumes of modelled blocks based on raw composite or ordinary kriged grade. The Company notes that this Exploration Target is reported in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (2012 Edition). The potential quantity and grade of this Exploration Target is conceptual in nature. There has been insufficient work to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource. Exploration works, including the drilling discussed in this announcement, are currently underway to investigate the Target.