Mt Cattlin Ore Reserve update confirms mine life extension
BRISBANE, Australia, June 15, 2023 (GLOBE NEWSWIRE) -- Allkem Limited (ASX: AKE, “*Allkem*” or the “*Company*”) provides an Ore Reserve update for its Mt Cattlin operation in Western Australia (“*WA*").*HIGHLIGHTS*
· Ore Reserve tonnage increased 34% to 7.8Mt at 1.20% Li[2]O and 130ppm Ta[2]O[5] at a cut-off grade of 0.4% Li[2]O.
· The Ore Reserve and planned mining schedule suggests a projected Life-of-Mine for the next 4-5 years (2027-2028) via open pit mining methods. The Ore Reserve has increased with higher grade despite mining depletion to support production. The recent category upgrades in the latest Mineral Resource Estimate, and substantial increases in revenue pricing for spodumene concentrate have contributed to the increase in Ore Reserves.
· The next mining stage (Stage 4) consists of two separate cutbacks (Stage 4-1 and 4-2) to optimise ore presentation. A mining proposal for Stage 4 has been submitted to WA regulators and is anticipated to be received by the end of CY23.
· The Board has approved mining of the first cutback (Stage 4-1) of the open pit, which will result in continued spodumene production into 2026.
· In the second cutback (Stage 4-2), the increasing waste/ore strip ratio at depth via open pit mining methods is being evaluated against an alternate underground mining option. The company sees significant opportunity in transitioning to an underground mine including the unlocking of greater orebody extension potential and prolonging the life of mine.
· An underground Feasibility Study is expected to be delivered by Q1 CY24. It will enable a variety of scenarios to be modelled and will ensure an optimised future mining method is selected.
*ORE RESERVE ESTIMATE*
The Mt Cattlin Ore Reserve estimate is based on the Mineral Resource Estimate of 12.8Mt at 1.3% Li[2]O grade and 179ppm Ta[2]O[5], released on 17 April 2023. The Mineral Resource was updated after the completion of a major infill drilling program which successfully upgraded Inferred Mineral Resources with 92% of the total Mineral Resource tonnage now classified as Indicated Mineral Resources.
Allkem has reviewed and updated the Mt Cattlin Ore Reserve (Table 1 below), incorporating infill drilling results from the 2NW deposit, depleted mined material and site stockpiles at 31 March 2023 and material to be mined after this date are presented in accordance with JORC (2012) Ore Reserve Reporting.
*Table 1: Mt Cattlin Ore Reserve Update as at 31 March 2023*
*Classification* *Location* *Ore Tonnes
(Mt)* *Grade Li*[*2*]*O
(%)* *Grade Ta*[*2*]*O*[*5
*]*(ppm)* *Contained
Metal (‘000) t
Li*[*2*]*O)* *Contained
Metal (‘000) lbs
Ta*[*2*]*O*[*5*]
*Proved* In-situ - - - - -
*Probable* In-situ 6.1 1.3 130 80 1,800 Stockpiles 1.8 0.8 99 14 380
*Total Ore Reserve* *7.8* *1.2* *130* *93* *2,200*
^Notes: Ore Reserves are reported above a cut-off grade of 0.4 % Li[2]O. The reported Ore Reserve incorporates regularisation of the Mineral Resource to a Selective Mining Unit of dimension 5.0 m x 5.0 m x 2.5 m (East, North, Elevation), with no additional mining dilution or mining recovery factors applied. Estimates have been rounded to a maximum of two significant figures, thus sum of columns may not equal.
*Reserve* *Methodology *
Pit optimisations have been carried out using a fixed spodumene concentrate sale price of US$1,500/t and an exchange rate of 0.7 USD:AUD. Whittle pit optimisation software has been used to identify the preferred pit shell on which the pit design was based.
The target design shells were selected to provide a logically phased mine life that maintains future optionality to further evaluate the trade-off between the larger second phase cutback compared to, or in conjunction with, underground mining.
The current mine sequence is based on:
· Continued mining of the current stage (Stage 3) of the 2NW pit to completion,
· Phasing of the next stage (Stage 4) into two separate cutbacks to manage the strip ratio and provide smoother ore supply to the processing plant; and
· The timing of a Mining Proposal that has been lodged in May with WA regulators to extend the current pit and allow for both cutbacks. The associated documentation, including updated Mine Closure Plan, will be reviewed in due course and is anticipated to be approved by the end of CY23.The mine plan is shown to be technically and financially feasible with an overall life of mine (LOM) ore: waste strip ratio of 19.8:1. A suitable cashflow positive buffer exists below the assumed product prices to provide confidence that the Ore Reserve estimate will be financially viable within a reasonably expected range of possible product prices.
*Figure 1: Mt Cattlin Cross section Looking East *
*Figure 2: Mt Cattlin Stage 4 Open Pit Plan*
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*Figure 3: Mt Cattlin Stage 4 Open Pit Plan*
Prior to the current 2023 Ore Reserve estimate, the most recent estimate (Table 2) was a depletion by Allkem as of 30 June 2022. The 2023 Ore Reserve estimate shows the total reserves have increased despite the mining depletion that has occurred since the previous reserve statement. Mineral Resource conversion from Inferred to Indicated and the economic environment around Lithium have contributed to the increase in Ore Reserves.
*Table 2: Mt Cattlin Ore Reserve at 30 June 2022 *
*Category
* *Tonnage
Mt* *Grade
% Li2O* *Grade
ppm Ta2O5* *Contained metal
(‘000) t Li2O* *Contained metal
lbs Ta2O5*
Proven - - - - - %
Probable 2NW only 3.3 1.12 105 37.0 764,000 Stockpiles 2.4 0.80 122 19.0 646,000
*Total* *5.8* *0.98* *113* *56.0* *1,410,000*
^Notes: Reported at cut-off grade of 0.4 % Li[2]O within current mine design. The preceding statements of Ore Reserves conforms to the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code) 2012 edition. All tonnages reported are dry metric tonnes. Reported with 17% dilution and 93% mining recovery. Revenue factor US$650/tonne applied. Minor discrepancies may occur due to rounding to appropriate significant figures.
A description of the major factors that resulted in changes from the 2023 Ore Reserve to the 2022 Ore Reserve is as follows:
· An updated 2022 Mineral Resource Estimate with higher grade and increased tonnages in the Indicated category;
· Increased pit shell from US$650/tonne to US$1,500/tonne; and
· Decrease in Ore Reserves due to ongoing open pit mining and stockpile processing.*NEXT STEPS*
*Underground Feasibility Study *
The Underground Feasibility Study is underway and will trade off optimised mining methodologies to improve the most beneficial/more economic outcomes. The study is expected to be completed by early CY24. The approval to proceed as an underground mine will be compared with the existing Open Pit Feasibility Study and also consider the potential for future upside (i.e. orebody continuation at depth).
*Step out drilling *
It was observed that both the USD 1,100 and 1,500 RPEEE Mineral Resource iterations remain limited by a lack of drilling data which will be resolved by further step out drilling planned for later in CY23.
*RESOURCE AND RESERVE CONTROLS & GOVERNANCE*
Allkem ensures that quoted Mineral Resource and Ore Reserve estimates are subject to internal controls and external review at both project and corporate levels. Mineral Resource and Ore Reserves are estimated and reported in accordance with the 2012 edition of the JORC Code. Further information is available in the appendices and JORC Table 1.
Allkem stores and collects exploration data using industry standard software that contains internal validation checks. Exploration samples from drilling have certified reference material standards introduced to the sample stream at set ratios, typically 1 per 25 samples. These are reported as necessary to the relevant Competent Persons to assess both accuracy and precision of the assay data applied to resource estimates. In resource modelling, block models are validated by checking the input drill hole composites against the block model grades by domain.
Allkem engages independent, qualified experts on a commercial fee for service basis, to undertake Mineral Resource and Ore Reserve audits. Allkem internally reconciles the resource outcomes to validate both the process and the outcome.
The Company has developed its internal systems and controls to maintain JORC compliance in all external reporting, including the preparation of all reported data by Competent Persons who are members of the Australasian Institute of Mining and Metallurgy or a ‘Recognised Professional Organisation’. As set out above, the Mineral Resource and Ore Reserve statements included in this announcement were reviewed by suitably qualified Competent Persons (below) prior to their inclusion, in the form and context announced.
*PROJECT ECONOMICS*
Project economics for the full stage 4 expansion are set out below and will be updated following approval to proceed with stage 4-2 and/or an underground option.
*Operating costs*
Operating cash costs for the LOM are estimated at US$935/dmt produced. It incorporates the remainder of the current Stage 3 open pit, Stage 4 open pits, and processing of end-of-life stockpiles from 1 April 2023 to end of mine life.
The table below proves a summary of the estimated LOM annual unitary cost by category.
*Table 3: Estimated LOM operating cost by category*
*LOM Operating Cash Cost* *US$/dmt produced**
*
*Costs*
Mining 445
Processing 268
General & Administration 68
*Site Operating Costs * *780*
Transport & Logistics 40
*Cash & Operating Costs * *821*
Royalties 126
By-Product credits -12
*FOB Cash Cost * *935*
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*Commodity prices *
Forecast pricing for benchmark 6.0% Li[2]O spodumene concentrate has been sourced from independent market analyst group Wood Mackenzie^1 and discounted for costs and penalties to give a Realised Price. The final pricing used is effectively net A$ FOB.
Tantalite (Ta[2]O[5]) concentrate is a by-product that contributes meaningful, but not material, revenue to the project. A flat sale price based on existing contracts has been applied to expected production.
A forward USD: AUD exchange rate forecast provided by Allkem has been used for this study, as shown in Table 4.
*Table 4: Forward Estimates for Concentrate Price and Foreign Exchange*
*Period
* *Realised Li[2]O* * * *Exchange rate* * * *Realised Li[2]O* * * *Realised Ta[2]O[5]* * *
*US$/dmt* * * *AUD:USD* * * *A$/dmt* * * *A$/dry lb* * *
H2 CY23 4,048 0.70 5,783 34.72
CY24 2,074 0.70 2,963 34.72
CY25 1,425 0.70 2,036 34.72
CY26 2,375 0.70 3,393 34.72
CY27 2,103 0.70 3,004 34.72
CY28 1,762 0.70 2,517 34.72
H1 CY29 1,486 0.70 2,123 34.72 The cashflow model was also tested at a conservative realised price of US$1,500/dmt Li[2]O in the optimisation, and cashflows remained positive for the overall Ore Reserve, and on each stage.
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[^1 The data and information provided by Wood Mackenzie should not be interpreted as advice and you should not rely on it for any purpose. You may not copy or use this data and information except as expressly permitted by Wood Mackenzie in writing. To the fullest extent permitted by law, Wood Mackenzie accepts no responsibility for your use of this data and information except as specified in a written agreement you have entered into with Wood Mackenzie for the provision of such of such data and information.]*
Economic evaluation *
An economic evaluation was conducted by consultants Entech Mining using financial data sourced from Allkem, independent market analysis, and competitive tender.
Project economics for all of Stage 4 is forecast to generate a NPV of US$1.2B (A$1.7B) when evaluated with the prices in Table 4. Economics will be updated following approval to proceed with stage 4-2 or as an underground option
As an existing operation, Mt Cattlin requires only minor initial capital expenditure to support the Stage 4 expansion, and low total project capital requirements of approximately US$80m (A$115m). This will be funded from operating cashflow.
The economic model calculates Net Present Value (NPV) at a discount rate of 10% over the LOM from 31 March 2023. The NPV is based on financial model period cashflows, without allowance for taxation, depreciation, or financing provisions. The summary of this is shown in Table 5.
*Table 5: Summary of Mt Cattlin Project Economics*
*Parameter* *Unit* *Stage 3* *Stage 4-1* *Stage 4-2* *Closure
Stockpiles * *Total*
Product Produced Mt 0.4 0.2 0.3 0.1 *1.0*
Life-Of-Mine Revenue A$B 1.8 0.5 1.0 0.3 *3.5*
Life-Of-Mine Total Expenditure A$B 0.4 0.4 0.6 0.2 *1.5*
Life-Of-Mine Free Cashflow A$B 1.4 0.1 0.4 0.1 *2.0*
Free Cashflow Margin % 80% 22% 37% 36% *57**%*
Life-Of-Mine NPV A$B 1.4 0.1 0.2 0.1 *1.7*
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Sensitivity analysis *
Sensitivity analysis was conducted on the following variables (+/-20%) and quantified with the NPV outputs:
· Revenue factors: spodumene concentrate price, currency exchange rate and plant recovery
· Cost factors: mining operating costs and processing operating costs
The results are graphically summarised in Figure 4. The outputs show the expected heightened sensitivity from revenue factors compared to cost factors. The plant recovery and revenue trends mimic each other, and currency exchange rate (FX) is the inverse. The cost sensitivity trends of the mining and processing operating costs mimic each other with mining being somewhat influential on cashflow and NPV due to being a larger overall cost.
*Figure 4: NPV Sensitivity to Key Revenue and Cost Factor Variables*
*ENDS*
This release was authorised by Mr Martin Perez de Solay, CEO and Managing Director of Allkem Limited.
*Allkem Limited*
ABN 31 112 589 910
Level 35, 71 Eagle St
Brisbane, QLD 4000 *Investor Relations & Media Enquiries*
Andrew Barber
*M: +*61 418 783 701 *E: *Andrew.Barber@allkem.co
Phoebe Lee
*P: *+61 7 3064 3600* E**:* Phoebe.Lee@allkem.co *Connect *
info@allkem.co
+61 7 3064 3600
www.allkem.co
*IMPORTANT NOTICES*
This investor ASX/TSX release (*Release*) has been prepared by Allkem Limited (ACN 112 589 910) (the *Company* or *Allkem*). It contains general information about the Company as at the date of this Release. The information in this Release should not be considered to be comprehensive or to comprise all of the material which a shareholder or potential investor in the Company may require in order to determine whether to deal in Shares of Allkem. The information in this Release is of a general nature only and does not purport to be complete. It should be read in conjunction with the Company’s periodic and continuous disclosure announcements which are available at allkem.co and with the Australian Securities Exchange (*ASX*) announcements, which are available at www.asx.com.au.
This Release does not take into account the financial situation, investment objectives, tax situation or particular needs of any person and nothing contained in this Release constitutes investment, legal, tax, accounting or other advice, nor does it contain all the information which would be required in a disclosure document or prospectus prepared in accordance with the requirements of the Corporations Act 2001 (Cth) (*Corporations Act*). Readers or recipients of this Release should, before making any decisions in relation to their investment or potential investment in the Company, consider the appropriateness of the information having regard to their own individual investment objectives and financial situation and seek their own professional investment, legal, taxation and accounting advice appropriate to their particular circumstances.
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Past performance information given in this Release is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance.
*Forward Looking Statements*
Forward-looking statements are based on current expectations and beliefs and, by their nature, are subject to a number of known and unknown risks and uncertainties that could cause the actual results, performances and achievements to differ materially from any expected future results, performances or achievements expressed or implied by such forward-looking statements, including but not limited to, the risk of further changes in government regulations, policies or legislation; the risks associated with the continued implementation of the merger between the Company and Galaxy Resources Ltd, risks that further funding may be required, but unavailable, for the ongoing development of the Company’s projects; fluctuations or decreases in commodity prices; uncertainty in the estimation, economic viability, recoverability and processing of mineral resources; risks associated with development of the Company Projects; unexpected capital or operating cost increases; uncertainty of meeting anticipated program milestones at the Company’s Projects; risks associated with investment in publicly listed companies, such as the Company; and risks associated with general economic conditions.
Subject to any continuing obligation under applicable law or relevant listing rules of the ASX, the Company disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements in this Release to reflect any change in expectations in relation to any forward-looking statements or any change in events, conditions or circumstances on which any such statements are based. Nothing in this Release shall under any circumstances (including by reason of this Release remaining available and not being superseded or replaced by any other Release or publication with respect to the subject matter of this Release), create an implication that there has been no change in the affairs of the Company since the date of this Release.
*Competent Person Statement *
The information in this announcement that relates to Exploration Results and Mineral Resources is based on information compiled by Albert Thamm, B.Sc. (Hons)., M.Sc. F.Aus.IMM (203217), a Competent Person who is a Fellow of The Australasian Institute of Mining and Metallurgy. Albert Thamm is a full-time employee of Galaxy Resources Pty. Limited. Albert Thamm has sufficient experience that is relevant to the style of mineralization and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Albert Thamm consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears.
The information in this announcement that relates to the 31 March 2023 Mt Cattlin Ore Reserve is based on information compiled by Daniel Donald, B. Eng. (Mining), F.Aus.IMM (210032), a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy. Daniel Donald is an employee working for Entech Mining Pty Ltd and has been engaged by Allkem Limited to prepare the documentation for the Mt Cattlin operation on which the Ore Reserve Report is based, for the period ended 31 March 2023, and has sufficient experience that is relevant to the style of mineralization and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Daniel Donald consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears.
Technical information relating to the Company’s Mt Cattlin project contained in this release is derived from, and in some instances is an extract from, the technical report entitled “Mt Cattlin Ore Reserve Estimate, March 31, 2023“ (Technical Report) which has been reviewed and approved by Albert Thamm, F.Aus.IMM (who is an employee of Galaxy Resources Pty. Ltd) as it relates to geology, drilling, sampling, exploration, QA/QC and mineral resources and Daniel Donald F.Aus.IMM (an employee of Entech Pty Ltd) as it relates to mining methods, Ore Reserves, site infrastructure, capital cost, operating cost estimates, , mining cost, financial modelling and economic analysis in accordance with National Instrument 43-101 – Standards for Disclosure for Mineral Projects. The Technical Report will be filed within 45 days of this release and will be available for review under the Company’s profile on SEDAR at www.sedar.com.
*Not* *for* *release* *or* *distribution in the* *United States*
This announcement has been prepared for publication in Australia and may not be released to U.S. wire services or distributed in the United States. This announcement does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States or any other jurisdiction, and neither this announcement or anything attached to this announcement shall form the basis of any contract or commitment. Any securities described in this announcement have not been, and will not be, registered under the U.S. Securities Act of 1933 and may not be offered or sold in the United States except in transactions registered under the U.S. Securities Act of 1933 or exempt from, or not subject to, the registration of the U.S. Securities Act of 1933 and applicable U.S. state securities laws.
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*APPENDIX 1 – JORC 2012 TABLE 1 DISCLOSURE*
*Section 1: Sampling Techniques and Data*
*MT CATTLIN LITHIUM PROJECT SAMPLING AND DATA*
*Sampling techniques* Nature and quality of sampling (e.g. cut channels, random chips, or specific specialized industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting the broad meaning of sampling.
Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used.
Aspects of the determination of mineralization that are Material to the Public Report.
In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverized to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralization types (e.g. submarine nodules) may warrant disclosure of detailed information. *Pre-2017*
Mt Catlin mineralization was sampled using a mixture of Diamond (DD) Reverse Circulation drill holes (RC), rotary Air Blast (RAB) and Open Hole (OH). In the north zone drilling is a 40mE x 40mN spacing and infilled to 20mE to 25mE x 20mN to 20mN in the central zone. In the south the drilling is on a 40mE x 80mN pattern. Drill holes were drilled vertical to intersect true thickness of the spodumene mineralization.
A total of 39 DD holes for 1,528.56m, 986 RC holes for 48,763m,59 OH holes for 1,999m and 23 RAB for 402m had been completed before 2017.
The drill-hole collars were surveyed by professional survey contractors. A total of 71 drill holes were surveyed by Surtron Technologies Australia of Welshpool in 2010. Sampling was carried out under Galaxy Resources QAQC protocols and as per industry best practice.
RC sample returns were closely monitored, managed and recorded. Drill samples were logged for lithology and SG measurements. Diamond HQ and PQ core was quarter-cored to sample lengths relating to the geological boundaries, but not exceeding 1m on average. RC samples were composited from 1m drill samples split using a two-stage riffle splitter 25/75 to obtain 2kg to 4kg of sample for sample preparation. All samples were dried, crushed, pulverized and split to produce a 3.5kg and then 200g sub-sample for analysis For Li (method AAS40Q), for Ta, Nb and Sn (method XRF78O) and in some cases for SiO2, Al2O3, CaO, Cr2O3, Fe2O3, K2O3, MgO, MnO, P2O5, SO3, TiO2 and V2O5 were analysed by XRF78O. Entire drill-hole lengths were submitted for assay.
*Drilling 2017-8*
From 1m of drilling and sampling, two 12.5% splits are taken by a static cone splitter in calico drawstring bags. This obtains two 2kg to 4kg samples with one being retained as an archive sample and the other submitted for assay, where required an archive bag is used as the duplicate sample.
A 4.5-inch diameter rod string is used and the cyclone is cleaned at the end of every 6m rod as caking occurs from the mandatory use of dust suppression equipment.
*Drilling November 2018 – 2021*
Subsequent to 2018 update, 5,912m (41 holes) of new reverse circulation (RC) and 273.65m of diamond tails (2 holes) has been completed (excluding metallurgical and geotechnical) has taken place.
From 1m of drilling and sampling, two 12.5% splits are taken by a static cone splitter in calico drawstring bags. This obtains two 2kg to 4kg samples with one being retained as an archive sample and the other submitted for assay, where required an archive bag is used as the duplicate sample.
A 4.5-inch diameter rod string is used and the cyclone is cleaned at the end of every 6m rod as caking occurs from the mandatory use of dust suppression equipment.
*2022 Drilling*
The current drillhole dataset for the project contains 3,232 drillholes, for 175,950 metres, comprised of a combination of reverse circulation (RC), diamond drilling (DD), and RC with a diamond tail (RC_DDT) drillholes.
The dominant drillhole type is RC, with over 95% of the metres being from RC drillholes.
*
* *Hole_Type* *Count* * Metres * * % Drillholes * * % Metres * DDH 45 5,437.8 1.4% 3.1% RC 3,173 169,037.8 98.2% 96.1% RC_DDT 14 1,474.4 0.4% 0.8% *TOTAL* * 3,232 * * 175,950 * * 100% * * 100% *
*Drilling techniques* Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc.) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc.). RC drilling hammer diameter was generally 4 & 5/8 inches in early exploration, from 2009 and 2010 the bit diameter was 5 ¼ inches.
*RC 2017 -2020*
5.25-inch face sampling hammer, reverse circulation, truck mounted or tracked drilling rigs, Three Rivers Drilling, Castle Drilling.
Diamond core is generally RC from surface, and either PQ size tails in weathered rock and narrowed to HQ in fresh rock (standard tubing). Core was not oriented as the disseminated and weathered nature of the mineralization does not warrant or allow it. Diamond core is typically for metallurgical test-work. Pre-collars drilled short of mineralisation.
*RC 2021* A 5.25-inch face sampling hammer, used in reverse circulation. ASX (Australian Surface Exploration) drillers used for RC (including pre-collars).
*Diamond 2021*:
Wizard Drilling utilised for diamond drilling from surface. HQ size Metallurgical and geotechnical diamond drilling (standard tubing). Two Metallurgical holes were diamond tails from approximately 70m to 80m. Four Geotechnical holes were diamond from surface and two tails from 50-60m depth.
*RC 2022*
PXD drilling was utilised for RC drilling from surface. HQ size Metallurgical and geotechnical diamond drilling (standard tubing) by Orlando Drilling. Four Metallurgical holes were and three Geotechnical holes were diamond drilled from surface and two diamond tails from 150-160m depth.*Logging* Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies.
Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc.) photography.
The total length and percentage of the relevant intersections logged. All DD, RC and OH (PC) and RAB intervals were geologically logged (where applicable); RQD (DD only), interval weights, recovery, lithology, mineralogy and weathering were recorded in the database.
The DD core was oriented using the Ezy-Mark tool and after 2019 using the Reflex ACT electronic orientation tool.
Geological logging was qualitative.
Recording of interval weights, recovery and RQD was quantitative.
All DD core was photographed and representative 1m samples of RC and OH (PC) chips were collected in chip trays for future reference and photographed. All drill holes were logged in full.
*2017-2023 logging*
All drill holes are logged and validated via LogChief/ Maxwells Geosciences/DataShed systems.
Assays, standards and control limits are monitored after loading of each batch and reports supplied on demand. All drill holes are logged in full. Different Lithium bearing mineral species are logged in detail.*Sub- sampling techniques and sample preparation* If core, whether cut or sawn and whether quarter, half or all core taken.
If non-core, whether riffled, tube sampled, rotary split, etc. and whether sampled wet or dry.
For all sample types, the nature, quality and appropriateness of the sample preparation technique.
Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples.
Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling.
Whether sample sizes are appropriate to the grain size of the material being sampled. *Pre-2016 sampling*
All fresh rock DD core was quarter-cored using a stand mounted brick saw. Soft, weathered DD core was also sampled quarter-core, using a knife and scoop where applicable and practical.
RC samples were collected using a two stage riffle splitter. All samples were dry or dried prior to riffle-splitting.
All 2kg 1m drill samples were sent to SGS, dried, crushed, pulverized and split to approximately -75µ to produce a sample less than 3.5kg sub-sample for analysis.
Sampling was carried out under Galaxy Resources QAQC protocols and as per industry best practice.
Duplicate, blank and standard reference samples were inserted into the sample stream at random, but averaging no less than 1 blank and standard in every 25 samples.
Samples were selected periodically and screened to ensure pulps are pulverized to the required specifications.
Duplicate quarter-core samples were taken from DD core at random for testing averaging one in every 25 samples.
Duplicate riffle-split RC samples were taken at random, but averaging one every approximately 25 samples.
The sample sizes are appropriate to the style, thickness and consistency of the mineralization at Mt Catlin.
*Drilling 2016 (SGS) *
Core was halved by saw and sample lengths typically 0.5m in length. Sample preparation involved crushing followed by splitting of sample if sample greater than 3 kg using a riffle splitter (SPL26), Dry sample, crush to 6mm, pulverise to 75µm (PRP88) in a LM5 Mill.
*Drilling 2017-2021 *
Diamond drilling was typically sawn half core with whole core used for metallurgical test work.
*Intertek (2017-8)*
Samples are sorted and weighed. Samples >3kg are riffle split and milled in LM5 to obtain 85% passing 75 Microns. A 400g pulp is taken and a nominal 0.25g sub-sample is fused with sodium peroxide.
*Nagrom: 2018-2021*
RC chips are dried to 105C°, crushed to nominal top-size of 2 mm in a Terminator Jaw crusher using method CRU01. Pulverised up to 3 kg in a LM5 pulveriser mill at 80% or better passing 75µm, using method PUL01. If the sample is greater than 3 kg, the sample is dried, and split with rotary splitter before analysis, Diamond core is dried, crushed in a Terminator Jaw crusher to top size 6.3 mm, and pulverised in a LM5 mill up to 2.5 kg using method CRU01. If the sample is greater than 2.5 kg, the sample is riffle split after drying to reduce the sample size.
*Intertek 2022-3*
Samples are sorted and weighed. Samples >3kg are riffle split and milled in LM5 to obtain 85% passing 75 Microns. A 400g pulp is taken and a nominal 0.25g sub-sample is assayed by Sodium peroxide fusion in a Ni crucible / MS, OES method FP6-Li/OM19.*Quality of assay data and laboratory tests * The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total.
For geophysical tools, spectrometers, handheld XRF instruments, etc., the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc.
Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established. *Pre-2016 QAQC *
All samples were dried, crushed, pulverized and split to produce a 3.5kg and then 200g sub-sample for analysis For Li (method AS40Q), for Ta, Nb and Sn (method XRF78O) and in some cases for SiO2, Al2O3, CaO, Cr2O3, Fe2O3, K2O3, MgO, MnO, P2O5, SO3, TiO2 and V2O5 were analysed by XRF78O. This process involves fusing the sample in a platinum crucible using lithium metaborate/tetraborate flux. For Cs, Rb, Ga, Be and Nb from time to time analysis was by IMS40Q – DIG40Q to ICPMS end.
Duplicate, blank and certified reference samples were inserted into the sample stream at random, but averaging one every ~25 samples. Galaxy Resources utilized certified Lithium standards produced in China and one from SGS in Australia, STD-TAN1.
Inter-laboratory checking of analytical outcomes was routinely undertaken to ensure continued accuracy and precision by the preferred laboratory.
Samples were selected periodically and screened by the laboratory to ensure pulps are pulverized to the required specifications. All QAQC data is stored in the Mt Catlin database and regular studies were undertaken to ensure sample analysis was kept within acceptable levels of accuracy; the studies confirmed that accuracy and precision are within industry standard accepted limits.
Umpire analysis performed on pulps at Genalysis and Ultratrace Perth
*2016-QAQC *
In 2016 Perth SGS were used for a small 6 hole diamond program by General Mining. Samples were digested using a sodium peroxide fusion digest, method DIG90Q and the resultant solution from the digest was then presented to an ICP-MS for the quantification of Li2O, using method IMS40Q. The majority of standards submitted performed within expected ranges with a positive bias observed for two standards.
*2017 - 2021 QAQC*
Samples (including QA/QC samples) were processed by Intertek PLC, Perth laboratory in 2017 and 2018, by utilised method FP1 digest (Peroxide Fusion – complete), MS analytical finish, 22 elements, Li2O detection limit 0.03% Ta2O5 detection limit, 0.2 ppm. Monthly review of QA/QC, which includes blanks, field duplicates, high grade standards and CRM (certified reference materials) and SRM (standard reference materials). FS_ICPMS is a Laboratory Method FP1/MS (mass spectrometry) used to analyse for Cs, Nb, Rb, Ta,Th, and U . FS/ICPES (inductively coupled plasma emission spectroscopy) is Laboratory method FP1/OE used to analyse Al, Fe, K, Li, and Si. Reports include calculated values of oxides for all elements.
RC samples and diamond (including QA/QC samples) have been processed by Nagrom Perth, Perth Western Australia. Methods utilised from Lithium and Tantalum are ICP004 and ICP005 (Peroxide Fusion – complete). ICP005 utilises tungsten carbide bowl to reduce iron contamination at exploration and resource development stages (detection limit of 10ppm and 1ppm for Li2O and Ta respectively) Monthly review of QA/QC, which includes blanks, field duplicates, high grade standards and CRM (certified reference materials) and SRM (standard reference materials). All sampling has rigorous QAQC in terms of reference sampling as well as blank and standards introduced into the sample steam.
Duplicate field samples show some evidence of high nugget effect. Typically, duplicate pairs plot within acceptable limits. Field duplicates have been submitted at a rate of 1 per 20.5 samples.
Standards used are ASM0343, ASM0340 AMIS0339, OREAS147, OREAS148 and OREAS149.
Standards reported only one result outside three standard deviations from 533 assays for Lithium. The majority of Tantalum standards reported within three standard deviations.
Coarse blanks have shown no evidence of systematic contamination from 2016-2021 with results consistently low.
QAQC in 2022-3 is broadly in line with the processes above, assays are by Intertek, Perth and Kalgoorlie.
Standards used are OREAS 147, AMIS0341, OREAS 751, OREAS 753, OREAS 148, AMIS0341, AMIS0341, and OREAS 147 to support Sodium peroxide fusion in Ni crucible assay method MS, OES FP6-Li/OM19. This method provides near complete recovery for most samples.
Ore grade standards e.g. Oreas 751 reported only four results outside 2 standard deviations from assays for Lithia. The majority of Tantalum standards reported within 2 standard deviations.
A figure accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/a0a96d56-0609-4c98-a4b7-54a5abe86952
The data is moderately precise.
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*Verification of sampling and assaying* The verification of significant intersections by either independent or alternative company personnel.
The use of twinned holes.
Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.
Discuss any adjustment to assay data. *Pre-2018 Verification*
An external geological consultant and staff have visually assessed and verified significant intersections of core and RC and PC chips.
Several core holes were compared to neighbouring RC and PC drill holes.
The geological logging of the DD holes supports the interpreted geological and mineralization domains.
Studies on assays results from twinned holes showed a close correlation of geology and assays.
Primary data is recorded by hand in the field and entered Excel spread sheets with in-built validation settings and look-up codes.
Scans of field data sheets and digital data entry spread sheets are handled on site at Mt Cattlin.
Data collection and entry procedures are documented, and training given to all staff.
QAQC checks of assays had identified several standards out of control, these were subsequently reviewed and results rectified.
No clear and consistent biases were defined by Galaxy during the further investigations into QAQC performances although deviations were noted by Galaxy.
*2017-8 Verification*
CP independently verified drilling, sampling, assay and results from validated, externally maintained and stored database.
No adjustments to assay data other than conversion from Li to Li20 and Ta to Ta2O5.
*2018 - 2022 Verification*
The CP independently verified drilling, sampling, assay and results from validated, externally maintained and stored database.
No adjustments to assay data other than conversion from Li to Li20 and Ta to Ta2O5.
Primary data capture by Maxwell LogChief and management by Maxwell DataShed. Assay data loaded directly from Laboratory supplied .csv files as are downhole and collar surveys.
An independent data verification was completed as part of a 2021 Ni-43-101 filing by then competent person.
Data exported from SQL database and verified by the CP.
No adjustments are made to assay data.
*Section 2: Reporting of Exploration Results*
*Criteria* *JORC Code explanation* *Commentary*
*Mineral tenement and land tenure statu**s* · Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.
· The security of the tenure held at the time of reporting along with any known impediments to obtaining a license to operate in the area.
Mining Lease M74/244 was amalgamated and awarded on 04/08/2009 and is valid until 23/12/2030 and covers 1830 Ha.
The project is subject to normal projects approvals processes as regulated by the WA Department of Mines, Industry and Regulation.
The tenement is subject to the Standard Noongar Heritage agreement as executed 7 February 2018.
The underlying land is a mixture of freehold property and vacant Crown land. The property Freehold title is held by Galaxy Resources or its child subsidiaries.
*Exploration done by other parties* · Acknowledgment and appraisal of exploration by other parties.
During the 1960’s WMC carried out an extensive drilling program to define the extent of local spodumene bearing pegmatite. The WMC work led onto a further investigation into project feasibility.
In 1989 Pancontinental Mining, Limited drilled 101 RC drill holes. In 1990 Pancontinental drilled a further 21 RC drill holes.
In 1997 Greenstone Resources drilled 3 diamond holes and 38 RC holes, undertook soil sampling and metallurgical test work on bulk samples from the mine area.
Haddington Resources Ltd in 2001 drilled 9 diamond holes for metallurgical test work and undertook further sterilization drilling.
Galaxy acquired the M72/12 mining tenement from the Sons of Gwalia administrators in 2006. *Geology * · Deposit type, geological setting and style of mineralization.
The Mount Catlin Project lies within the Ravensthorpe Suite, with host rocks comprising both the Annabelle Volcanics to the west, and the Manyutup Tonalite to the east. The contact between these rock types extends through the Project area.
The Annabelle Volcanics at Mt Cattlin consist of intermediate to mafic volcanic rocks, comprising both pyroclastic material and lavas.
The pegmatites which comprise the orebodies occurs as a series of sub- horizontal sills, hosted by both volcanic and intrusive rocks, interpreted as a series of westward verging thrusts. Typical coarse grained spodumene (grey green colour) from the NW pegmatite shown below.
A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/f75c30db-a3c7-4a94-b77e-7e2fe8863892
*Drill hole Information* · A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes:
· easting and northing of the drill hole collar
· elevation or RL (Reduced Level – elevation above sea level in meters) of the drill hole collar
· dip and azimuth of the hole
· down hole length and interception depth
· hole length.
Pre-2017 drilling reported 4 August 2015 by subsidiary GMM (ASX:GMM). Last prior resource and update was 28 November 2018
*2019-2022 drill collars*
New resource development collar information is presented in Appendices below.
Holes generally inclined between -75 to -80 degrees to determine true width or due to local infrastructure.
*Data aggregation methods** * · In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (e.g. cutting of high grades) and cut-off grades are usually Material and should be stated.
· Where aggregate intercepts incorporate short lengths of high grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail.
· The assumptions used for any reporting of metal equivalent values should be clearly stated.
*Pre-2017 Data*
Where higher grade zones internal to broader intervals of lower grade mineralization were reported, these were noted as included intervals and italicized.
*2019-2022 Drilling*
New results are reported to a 0.3% cut-of grade (below), minimum 4m width, maximum 1m internal dilution. Only drillholes incorporated into the resource model are reported.
No metal equivalent values are used. *Relationship between mineralization widths and intercept lengths* · These relationships are particularly important in the reporting of Exploration Results.
· If the geometry of the mineralization with respect to the drill hole angle is known, its nature should be reported.
· If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg ‘down hole length, true width not known’).
All intersection grades have been reported previously as length weighted average grades using a 0.3% Li2O lower grade cut-off except where stated.
Intersections were calculated allowing a maximum of 2m of internal dilution with no top-cut applied. Cutting of high grades is not required due to nature of the mineralization and grade distribution/estimation.
The Mt Cattlin lithium and tantalum mineralization occurs as a thick horizontal to gently dipping pegmatite and generally lies 30 to 280m below the current topographic surface resulting in drill intercepts nearing true widths.
All reported intersections in 2023 are approximate true widths.
*Diagrams* · Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.
Diagrams are included in the text above.*Balanced reporting* · Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.
All significant intersections above 0.3% Li2O have been fully reported in previous releases.
*2019-2022 Drilling*
Drill hole collars and relevant assay details are appended below.*Other substantive exploration data * · Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk sample– size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances.
Fe2O3 is modelled with Li and Ta to determine the effect of deleterious chemistry and mineralogy at or near pegmatite contacts and rafts of surrounding country rock with pegmatite.
*Further work** * · The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step-out drilling).
· Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.
Development and extraction of the NW Pit Mineral Resource and Reserve.
Diagrams are illustrated in the text above.
Feasibility study work to trade off open pit vs underground options has commenced.
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*Section 3: Estimation and Reporting of Mineral Resources – Mt Cattlin*
*Criteria* *JORC Code explanation* *Commentary*
*Database integrity* · Measures taken to ensure that data has not been corrupted by, for example, transcription or keying errors, between its initial collection and its use for Mineral Resource estimation purposes.
· Data validation procedures used.
*Pre-2017*
At the time of the 2012 Mineral Resource estimates, Allkem had appointed a data administrator to manage and host the Mt Catlin database in a GBIS SQL database.
Field data was entered into project-specific password-protected spread sheets with in-built auto-validation settings. The spread sheets were emailed to head office on a weekly basis and then passed on to the data administrator, where all data was subject to validation procedures and checks before being imported into the central database. Invalid data was not imported into the central database but was quarantined until corrected. Data exports were routinely sent from head office to site for visual validation using ArcGIS and Micromine.
*2017 to Jan 2019*
Database and data QAQC processes was re-established after review in 2016. The Datashed database was managed/maintained by Maxwell Geoservices and was validated externally to GXY and aggregated meta-data from site and the sample laboratory. The assay laboratory reported sample validation and checks on arrival. Database managers’ reported both QAQC and validation checks monthly and upon request.
*Jan 2019 to Current*
Allkem have employed a Database Administrator who loads all data, manages the database and performs routine validations on all loaded data.
All logging is undertaken on a Toughbook using the dedicated LogChief logging system matched to the Datashed database.
Visual validation of drilling data versus the wireframes in Surpac software is undertaken routinely by Mine Geology and Exploration personnel.*Site visits* · Comment on any site visits undertaken by the Competent Person and the outcome of those visits.
· If no site visits have been undertaken indicate why this is the case.
The reporting CP has completed several site visits since 2016.*Geological interpretation* · Confidence in (or conversely, the uncertainty of) the geological interpretation of the mineral deposit.
· Nature of the data used and of any assumptions made.
· The effect, if any, of alternative interpretations on Mineral Resource estimation.
· The use of geology in guiding and controlling Mineral Resource estimation.
· The factors affecting continuity both of grade and geology.
The geological interpretation is considered robust due to the nature of the geology and mineralisation.
Surface diamond and reverse circulation (RC) drillholes have been logged for lithology, structure, and alteration and mineralisation data.
The lithological logging of pegmatite in combination with the Li[2]O, Fe[2]O[3] and MgO assays, including grain size and mineralogical differentiation, have been used to guide the sectional interpretation of the pegmatites in Leapfrog Geo modelling software.
The geological wireframes have then been used as a boundary within which internal, mineralisation wireframes have been generated in Leapfrog software using geology logging and assay data. The primary assumption is that the mineralisation is hosted within the fine-grained material within the pegmatite sills, which is considered robust.
Weathering surfaces have been updated by Allkem Resources in Leapfrog Geo software for recently completed drillholes.
Due to the consistent nature of the pegmatite identified in the area, no alternative interpretations have been considered. The pegmatites are found to be continuous over the area of the deposit.
The Li[2]O% mineralisation interpretations are contained wholly within the pegmatite geological units. Evidence of late-stage faulting is present and has, where appropriate, been incorporated into the geological model.*Dimensions* · The extent and variability of the Mineral Resource expressed as length (along strike or otherwise), plan width, and depth below surface to the upper and lower limits of the Mineral Resource
The Mt Cattlin pegmatites strike north-south and are typically between 10 m and 30 m wide and are typically flat-lying or with a subtle dip east of around 5 to 10 degrees. Several different pegmatites have been identified, either as separate intrusions or due to fault offsets, over a strike length of 1,300 m, an across strike extent of 1,700 m and down to a depth of greater than 300 m below surface.
Thirteen pegmatites have been identified to date in the NW and SW area. They range in extent from 50 m along strike and 50 m down-dip to 650 m along-strike and 500 m down-dip. The pegmatites range in thickness from a few metres to 20 m.*Estimation and modelling techniques* · The nature and appropriateness of the estimation technique(s) applied and key assumptions, including treatment of extreme grade values, domaining, interpolation parameters and maximum distance of extrapolation from data points. If a computer assisted estimation method was chosen include a description of computer software and parameters used.
· The availability of check estimates, previous estimates and/or mine production records and whether the Mineral Resource estimate takes appropriate account of such data.
· The assumptions made regarding recovery of by-products.
· Estimation of deleterious elements or other non-grade variables of economic significance (e.g. sulphur for acid mine drainage characterisation).
· In the case of block model interpolation, the block size in relation to the average sample spacing and the search employed.
· Any assumptions behind modelling of selective mining units.
· Any assumptions about correlation between variables
· Description of how the geological interpretation was used to control the resource estimates.
· Discussion of basis for using or not using grade cutting or capping.
· The process of validation, the checking process used, the comparison of model data to drillhole data, and use of reconciliation data if available.
Grade estimation for Li[2]O%, Fe[2]O[3]% and Ta[2]O[5] ppm has been completed using Ordinary Kriging (OK) into pegmatite domains using Datamine, Studio RM software. Grade estimation of Fe[2]O[3]% has been completed using OK into the encapsulating mafic waste and late-stage mafic dyke, which intersects the pegmatites.
The geological, mineralisation and weathering wireframes generated have been used to define the domain codes by concatenating the three codes into one. The drillholes have been flagged with the domain code and composited using the domain code to segregate the data. Hard boundaries have been used at all domain boundaries for the grade estimation Pegmatite waste wireframing using <0.3% lithia and < 4% Na2O.
Compositing has been undertaken within domain boundaries at 1m with a merge tolerance of 0.1 m.
Top cuts for all elements have been assessed for all mineralised and un-mineralised pegmatite domains, as well as for the external waste and mafic dyke domains, with only those domains with extreme values having been top cut. The top cut levels have been determined using a combination of histograms, log probability and mean-variance plots. Two domains have been top cut for Li[2]O. Three domains have been top-cut for or Ta[2]O[5 ]ppm and no top-cutting completed in Fe[2]O[3]%.
Variography has been completed in Supervisor 8.14 software on an individual domain basis. Domains with too few samples have borrowed variography.
No assumptions have been made regarding the recovery of any by-products.
The drillhole data spacing ranges from 40 m by 40 m resource definition drillhole spacing out to an 80 m by 80 m exploration spacing.
The block model parent block size is 20 m (X) by 20 m (Y) by 5 m (Z), which is considered appropriate for the dominant drillhole spacing used to define the deposit. A sub-block size of 2.5 m (X) by 2.5 m (Y) by 0.625 m (Z) has been used to define the mineralisation edges, with the estimation undertaken at the parent block scale*.*· Pass 1 estimations have been undertaken using a minimum of 7 and a maximum of 27 samples into a search ellipse set at approximately half of the variogram range. A 4 sample per drillhole limit has been applied in all pegmatite domains.
· Pass 2 estimations have been undertaken using a minimum of 7 and a maximum of 27 samples into a search ellipse set at approximately the variogram range. A 4 sample per drillhole limit has been applied in all pegmatite domains.
· Pass 3 estimations have been undertaken using a minimum of 2 and a maximum of 24 samples into a search ellipse set at four times the Search 2 range.
The Mineral Resource estimate has been validated using visual validation tools combined with volume comparisons with the input wireframes, mean grade comparisons between the block model and composite grade means and swath plots comparing the composite grades and block model grades by Northing, Easting and RL.
Mining reconciliation data for the NW and SW regions is available.
No selective mining units are assumed in this estimate.
No correlation between variables has been assumed.*Moisture* · Whether the tonnages are estimated on a dry basis or with natural moisture, and the method of determination of the moisture content.
Tonnes have been estimated on a dry basis.*Cut-off parameters* · The basis of the adopted cut-off grade(s) or quality parameters applied
For the reporting of the Mineral Resource Estimate, a 0.4 Li2O% cut-off within a USD 1,100 Whittle pit shell has been used.*Mining factors or assumptions* · Assumptions made regarding possible mining methods, minimum mining dimensions and internal (or, if applicable, external) mining dilution. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider potential mining methods, but the assumptions made regarding mining methods and parameters when estimating Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the mining assumptions made.
A Whittle pit optimisation has been run at 1,100 USD in order to generate a pit shell wireframe for Mineral Resource reporting purposes and to meet the RPEEE reporting requirement.
The mining assumptions/parameters applied to the optimisation are:· Mining Recovery – 93%
· Mining Dilution – 17%
· Li2O% Price/tonne 6% concentrate – USD$1,100
· Li2O% recovery – 75%
· Ta2O5ppm Price/pound concentrate – USD$40
· Ta2O5ppm recovery – 25%
· Transport and port Cost/tonne – AUD$49.68
· State Royalty – 5%
· Processing Cost/tonne – AUD$33.16
· Mining Cost/tonne – AUD$4.29
USD exchange rate of 0.70 Li[2]O cut-off of 0.4% has been applied in the Whittle optimisation.
Both Inferred and Indicated Mineral Resource classifications have been utilised in the RPEEE optimisation.*Metallurgical factors or assumptions* · The basis for assumptions or predictions regarding metallurgical amenability. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider potential metallurgical methods, but the assumptions regarding metallurgical treatment processes and parameters made when reporting Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the metallurgical assumptions made.
A Li2O% metallurgical recovery of 75% and Ta2O5 ppm recovery of 25% has been applied during the pit optimisation and generation of the RPEEE pit shell.*Environmental factors or assumptions* · Assumptions made regarding possible waste and process residue disposal options. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider the potential environmental impacts of the mining and processing operation. While at this stage the determination of potential environmental impacts, particularly for a greenfields project, may not always be well advanced, the status of early consideration of these potential environmental impacts should be reported. Where these aspects have not been considered this should be reported with an explanation of the environmental assumptions made
No environmental factors or assumptions have been incorporated into this Mineral Resource Estimate since Mt Cattlin is a producing operation with Environmental approvals and an Environmental Management Plan in place.*Bulk density* · Whether assumed or determined. If assumed, the basis for the assumptions. If determined, the method used, whether wet or dry, the frequency of the measurements, the nature, size and representativeness of the samples.
· The bulk density for bulk material must have been measured by methods that adequately account for void spaces (vugs, porosity, etc), moisture and differences between rock and alteration zones within the deposit,
· Discuss assumptions for bulk density estimates used in the evaluation process of the different materials. No additional bulk density data has been collected in the NW Area. As a consequence, the bulk density values determined in the previous MRE (Nov 2018) have been assigned to the block model.
The bulk densities which have been assigned to the Mineral Resource block model by lithology and weathering state are: Waste Lithologies Oxide 2.50 Transitional 2.70 Fresh 2.86 Unmineralized Oxide 2.42 Pegmatite Transitional 2.62 Fresh 2.78 Mineralised Pegmatite Oxide 2.47 Transitional 2.71 Fresh 2.72
*Classification* · The basis for the classification of the Mineral Resources into varying confidence categories
· Whether appropriate account has been taken of all relevant factors (i.e. relative confidence in tonnage/grade estimations, reliability of input data, confidence in continuity of geology and metal values, quality, quantity and distribution of the data).
· Whether the result appropriately reflects the Competent Person’s view of the deposit.
The resource classification has been applied to the MRE based on the drilling data spacing, grade and geological continuity, quality of the estimation and data integrity.
The classification takes into account the relative contributions of geological and data quality