Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up...

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Burnside Operations Pty Ltd Zapopan Resource Report MLN1139 August 2003 A. Gillman B.Sc (Hons), F.Aus.IMM, CP(Geol) Harmony Gold Operations Ltd P.Harris B.Sc Harmony Gold Operations Ltd F. Dyer BSc(Hons), MAusIMM, MAIG GeoStat Services

Transcript of Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up...

Page 1: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Burnside Operations Pty Ltd

Zapopan Resource Report

MLN1139

August 2003

A. Gillman B.Sc (Hons), F.Aus.IMM, CP(Geol)

Harmony Gold Operations Ltd

P.Harris B.Sc

Harmony Gold Operations Ltd

F. Dyer BSc(Hons), MAusIMM, MAIG

GeoStat Services

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Zapopan Resource Report, August 2003 2

ZAPOPAN RESOURCE KEY POINTS:

• Total undiluted resource of 298,438t averaging 15.12g/t Au for 145,096oz

• Resource comprises of three separate but genetically linked lodes in close proximity to each other

• Vertical extent of 210m

• Total of 1400 tonnes per vertical metre

• Total 700 ounces gold per vertical metre

• Total average grade of 15.12g/tAu

• Main Lode contains the most significant known tonnes and grade

• Main Lode comprises 173,375t grading 17.01g/tAu

• Main Lode averages 3.3m true width with a maximum width of 5.5m near the hinge

zone

• Main Lode has a down-plunge extent of over 300m at –40°

• About 70% of the contained gold in the main Lode occurs in the hinge zone

• Hinge zone of the Main Lode plunges at about -35° to grid east

• Average grade of the Main Lode varies along strike from the limb area (10.68g/t) to the hinge zone (22.39g/t)

• Lodes are separated by faults (slides) that produce highly unstable, broken ground

• Resource has been partially exploited by decline and two level drives at 1000RL and

980RL respectively

• Numerous occurrences of coarse visible gold

• Higher grade is associated with abundant arsenopyrite. However, gold is free milling and there are no metallurgical problems.

• There is significant potential to upgrade and extend, at depth, the existing resource

with surface-collared drillholes specifically directed at the Central Lode

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Zapopan Resource Report, August 2003 3

Volume I

Table of Contents

1.0 INTRODUCTION...........................................................................................................................1

2.0 PREVIOUS WORK .......................................................................................................................2

3.0 GEOLOGY....................................................................................................................................2

3.1 REGIONAL GEOLOGY.............................................................................................................2 3.2 LOCAL GEOLOGY ...................................................................................................................2

4.0 ORE BODY CHARACTERISTICS................................................................................................3

4.1 LITHOLOGY .............................................................................................................................3 4.2 STRUCTURE............................................................................................................................3 4.3 MINERALISATION....................................................................................................................3 4.4 LODE MORPHOLOGY .............................................................................................................7

4.4.1 FISSURE LODE................................................................................................................7 4.4.2 MAIN LODE ......................................................................................................................8 4.4.3 CENTRAL LODE...............................................................................................................8 4.4.4 MINOR LODES.................................................................................................................8

4.6 ORE TEXTURES ......................................................................................................................8

5.0 PREVIOUS BURNSIDE JV RESOURCE CALCULATIONS .......................................................9

5.1 VERSION 1...............................................................................................................................9 5.2 VERSION 2 - LENS MODEL..................................................................................................10 5.3 VERSION 3 - PAY ZONE MODEL.........................................................................................11

6.0 RESOURCE ESTIMATION VERSION 4.....................................................................................12

6.1 METHODOLOGY....................................................................................................................12 6.2 WIREFRAME MODELLING ....................................................................................................12

6.2.1 Lode Models....................................................................................................................12 6.2.2 Dilution Mode ..................................................................................................................12 6.2.3 Grade Domain Boundary ................................................................................................12

6.3 DATA ......................................................................................................................................13 6.4 SG DETERMINATIONS..........................................................................................................13 6.5 TOP CUT SELECTION - MAIN LODE ....................................................................................13 6.6 GRADE INTERPOLATION .....................................................................................................13

7.0 RESOURCE CATEGORIES .......................................................................................................14

7.1 MAIN LODE ........................................................................................................................14 7.2 CENTRAL LODE.................................................................................................................14 7.3 FISSURE LODE..................................................................................................................14

8.0 CONCLUSIONS..........................................................................................................................15

9.0 FURTHER EXPLORATION ........................................................................................................15

10.0 CONSIDERATIONS FOR MINING .............................................................................................16

10.1 UNEVEN DISTRIBUTION OF GRADE/METAL ALONG LEVELS ......................................16 10.2 MINIMUM MINING WIDTH .................................................................................................16 10.3 EFFECTS OF DILUTION ....................................................................................................17 10.4 LOW GRADE PODS WITHIN THE HIGH-GRADE HINGE ZONE ......................................17 10.5 MINING SEQUENCE ..........................................................................................................17

11.0 RECOMMENDATIONS...............................................................................................................17

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Zapopan Resource Report, August 2003 1

Tables Table 1 Effect of MRT Top-cutting Methodology.....................................................................................9

Table 2 Version 2 Model Resource Estimate .......................................................................................10

Table 3 Zapopan Resource Summary (by mining levels) ....................................................................24

Table 4 Zapopan Resource Summary (by regular 10m levels) ............................................................25

Table 5 Zapopan Resource Summary with Categories.........................................................................26

Table 6 Resource Comparisons - Zapopan Main Lode.........................................................................27

Table 7 Diluted Main Lode Resource Estimate .....................................................................................28

Figures

Figure 1 Section 11406E........................................................................................................................4

Figure 2 Plan View 1000 Level ..............................................................................................................5

Figure 3 Plan View 980 Level ................................................................................................................6

Figure 4 Main Lode Long Section - Average Grade Contours from Drillhole Centroids .......................18

Figure 5 Main Lode Long Section - Average Grade Contours .............................................................19

Figure 6 Main Lode Long Section - Horizontal Thickness (m) of Wireframe ......................................20

Figure 7 Main Lode Long Section - Gram-metre Contours .................................................................21

Figure 8 Face Mapping - 980 Level Cross-cut .....................................................................................22

Plates

Plates 1 General oblique 3D view looking towards grid NW ..................................................................29

Plates 2 Oblique 3D view of the Main Lode ...........................................................................................29

Plates 3 Close-up 3D view of the Main Lode .........................................................................................29

Plates 4 Oblique 3D view of the lode system showing occurrences of visible gold................................29

Appendices

Appendix 1 Geostatistical Modelling Report..........................................................................................30

Appendix 2 Assay and QAQC Procedures............................................................................................31

Appendix 3 Resource Modeling Flowchart............................................................................................32

Appendix 4 Resource Model Interval Table ..........................................................................................33

Volume II

Face Mapping Cross sections

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Zapopan Resource Report, August 2003 1

1.0 INTRODUCTION

On behalf of the Burnside Joint Venture, geological and resource modelling was carried out

on the Zapopan gold deposit in the south central area of the Pine Creek Geosyncline in the

Northern Territory.

Zapopan is located at the Brock’s Creek Gold Operation within MLN1139 and forms part of

the Burnside Joint Venture between Harmony Gold Operations (50%) and Northern Gold NL

(50%).

A decline commenced from an in-pit portal in September 2002. Two level-drives, at the

1000RL and 980RL respectively, were completed before further development and decline

advance were suspended in May 2003. A program of underground diamond drilling totaling

1,529m in 36 holes was completed between May and July 2003.

This additional drilling information, together with historic exploration data, has enabled a

revised geological interpretation and resource calculation.

The total undiluted resource, as reported from an inverse distance squared block model

comprises :

298,438t averaging 15.12g/t Au for 145,096oz

The distribution by resource categories is summarized below in accordance with the JORC

code.

Category Tonnes Grade Oz Au measured 75,285 17.78 43,038 indicated 147,866 14.67 69,720 inferred 75,287 13.36 32,338 Total 298,438 15.12 145,096

Between the 1005RL and 820RL the undiluted resource equates to 750oz Au per vertical

metre.

The resource comprises three fault-separated lodes namely the Main, Central and Fissure.

While the Fissure Lode was the target of the historic underground and open pit mining the

Main Lode is the key resource. All historic exploration drilling has specifically targeted the

Main Lode. However, recent work has confirmed that the Central Lode is the displaced

portion of the Main Lode and could be as significant. Recommended further exploration is

designed to properly test the Central Lode.

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Zapopan Resource Report, August 2003 2

2.0 PREVIOUS WORK

Previous resource modeling work, that is relevant to this report, was carried out by Mining and

Resource Technology Pty Ltd (MRT) in 1999 on behalf of Zapopan’s previous owner – Acacia

Resources Limited. At that time MRT reported an indicated resource for the Main Lode of

169,000t at an average grade of 18.55g/tAu. No subsequent documented resource estimates

are available. Some of the results of this work are discussed below.

3.0 GEOLOGY 3.1 REGIONAL GEOLOGY Situated in the Pine Creek Geosyncline, local stratigraphy comprises Proterozoic clastic

metasediments of the South Alligator Group, including the basal Koolpin Formation, Gerowie

Tuff and Mount Bonnie Formations. Zapopan is located at or close to the contact between the

Gerowie Tuff and Mount Bonnie formation. Lithologies comprise interbedded metasiltstones

(argillites), greywackes, tuffs and cherts, metamorphosed to approximately greenschist facies.

Minor interbedded cherts, tuffs and BIFs are present. Mafic dykes and sills of the Zamu

Dolerite are present. The sequence is intruded by the Cullen Batholith, a post-tectonic granite.

3.2 LOCAL GEOLOGY Zapopan is located on the Brocks Creek Shear Zone (BKSZ), a locally significant structure

with respect to gold mineralisation. The BKSZ is interpreted as an ENE (305°) trending shear

zone which hosts the deposits John Bull in the west, Alligator, Burgan and Faded Lily toward

the east, with Zapopan roughly one kilometre east of Faded Lily. The southern margin of the

Burnside Granite, part of the Cullen Batholith, is roughly three kilometres north of the BKSZ.

In the Faded Lily-Zapopan area, the BKSZ is coincident with a roughly -35° east-plunging

anticline, with an overturned steep south dipping to vertical north limb and a -55° to -60°

south- dipping southern limb. Shearing manifests as ESE trending reverse faults and shear

zones from half to a few metres thick. These are visible at Zapopan as crush zones up to

three metres thick.

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Zapopan Resource Report, August 2003 3

4.0 ORE BODY CHARACTERISTICS 4.1 LITHOLOGY Local stratigraphy comprises dark grey massive to finely laminated weakly metamorphosed

siltstone. Interbedded greywackes, cherts, laminated calcsilicates, banded iron formation and

mafic dykes are present. These interbedded units range in thickness from a few centimetres

to rarely more than a metre.

4.2 STRUCTURE Mineralisation is hosted by bedding sub-parallel quartz veins on the southern limb of a tight

asymmetric anticline, which plunges east at roughly -35°. The axial zone is approximately

10m wide at the fold hinge. Parasitic folds are common within this zone. The southern limb

dips south at about 55 to 58°, while the north limb is subvertical.

Two subparallel faults, named the North and South Slides, cross the anticline at a low angle,

trending approximately 115° (mine grid) and dipping south at about -80° (Figures 1,2 & 3).

The slides are over one metre wide, 30m apart and are characterised by zones of heavily

broken, sheared rock, with a puggy clay zone. Movement on these structures is principally

reverse dip-slip.

4.3 MINERALISATION

From underground mapping, five discrete vein/lithological units, or lenses, have been

identified: Z5, Z10, Z15, Z20 and Z30

• Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au.

• Z10 is a pyritic quartz-reef style vein with, lesser arsenopyrite and some carbonate,

with an average grade of 17.68g/tAu.

• Z15 is similar to the Z10, however it appears to contain increased arsenopyrite and,

consequently, higher grade.

• Z20 is similar to the Z5 and may be used as a marker, yet it shows signs of

rebrecciation, and where best mineralised, contains no hematite, with grades

averaging 31.15g/tAu.

• Z30 is not apparent along the entire length of the main lode, however, towards the

hinge it becomes well developed with grades averaging 23.39g/tAu.

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1030RL

1020RL

1020RL

1000RL

990RL

980RL

970RL

960RL

950RL

940RL

No

rthS

lide

So

uth

Slid

e

Fissure Lode

Main Lode

Central Lode

decline

decline 980 drive

1000 drive

Figure 1

Section 11406E

980 stockpile

position of Z5 lens

(solid outlines as modelled)

visible gold

UZ12

UZ11

UZ10

UZ28

ZAPRD66

2

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1410N

1380N

1390N

1400N

1420N

1430N

1440N

1450N

1460N

1470N

11360E

11380E

11400E

11420E

1410N

1380N

1390N

1400N

1420N

1430N

1440N

1450N

1460N

1470N

Li

Domai

mb

n

North Slide

South Slide

Fissure Lode

Main Lode

Central Lode

Figure 2

Plan View1000 Level

(solid outlines as modelled)

decline

Z5

Z10

Z20

Z30

Hin

geDom

ain-50°

-55°

-40°

-40°

- 04 °

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11440E

11380E

11400E

11420E

1410N

1380N

1390N

1400N

1420N

1430N

1440N

1450N

1460N

1370N

1360N

Hin

geDom

ain

Li

Dom

ain

mb

Z5

Z10Z20

Z30

North Slide

South Slide

Fissure Lode

Main Lode

Central Lode

Figure 3

Plan View980 Level

(solid outlines as modelled)

decline

-55°

-56°

-30°

-30°

-30°

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Zapopan Resource Report, August 2003 7

Figures 2 and 3 illustrate the arrangement of these lenses within the Main Lode.

The axial plane appears to be loci of gold deposition. There is no significant mineralization at

the Main Lode /slide intersection. The slide faults may have acted as conduits or represent

late stage brittle features representing the stress regime at time of mineralisation.

Mineralisation is interpreted to have formed from several stages of deformation. The Z5 and

Z20 lenses are truly concordant with stratigraphy and most likely formed early in the

mineralization sequence.

The other mineralised lenses appear to be later and represent brittle deformation within the

folded anticline. These late quartz reefs are not truly concordant and ramp up and down the

stratigraphy.

4.4 LODE MORPHOLOGY

There are three separate lodes – Main, Central and Fissure (Plate 1). Prior to deformation

these lodes were part of a single continuous strataform unit. With subsequent fault (slide)

displacement the unit has been split into what we now see as three separate lodes that are

off-set with respect to one-another.

The Main and Fissure Lodes dip at about 55° towards the south (Figure 1). The Central Lode

comprises more of the hinge zone of the fold, resulting in moderate dips that follow the plunge

in the area of the fold axis and steeper, sub-vertical dips on the thinning limbs. At first glance

cross-sectional views through this Lode may appear odd.

4.4.1 FISSURE LODE The Fissure Lode is located on the southern side of the South Slide. This lode is poorly

defined and was targeted in the last round of underground drilling. The Fissure Lode is

truncated to the east by the South Slide, and appears to feather-out to the west. This lode

was the principal target of historical mining efforts, and comprised the bulk of the open cut

resource.

The Fissure Lode is interpreted to be the faulted off portion of the Main Lode, with Z10 and

Z20 equivalents being identified in the recent drilling. Individual veins vary in thickness from

east to west, and to a lesser extent downdip. The recent drilling has indicated several >20g/t

assays over one metre intervals.

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Zapopan Resource Report, August 2003 8

4.4.2 MAIN LODE The Main Lode, located between the South and North Slides, is the principal ore source. This

lode strikes east-west and dips south at about -55°. Grade generally decreases with distance

from the axial plane with the best grades being closest to the axial plane and not the North

Slide contact as originally interpreted.

4.4.3 CENTRAL LODE The Central Lode is interpreted to be the off faulted northern limb of the orebody. Mapping in

the 980RL stockpile has revealed that lodes analogous to the Z5, Z10, Z20 and Z30 are all

expressed in the Central Lode. Best grades are encountered in the Z20 equivalent unit, where

there is an abundance of arsenopyrite. Mineralisation appears to be controlled by fluid O2

content, where high (hematite) grades are in the order of 0.5g/t, where low (arsenopyrite)

grades can be 100g/t.

In the 980 stockpile area, hematitic alteration (and associated low gold-grade) is developed

between a poorly defined minor fault and the North Slide. High gold-grades together with

visible gold are developed in the arsenopyrite rich “facies” immediately below (north) of the

fault (Figure 8).

4.4.4 MINOR LODES At least two, and at depth, possibly three minor lodes have been documented in the past.

These lodes are developed in the footwall to the Main Lode and like the Main Lode are

truncated by the North Slide. Intersections of these lodes are sporadic and typically narrow.

These lodes have not been included in the current resource estimate, as there is probably no

method in which they could be extracted without significant dilution.

4.6 ORE TEXTURES Best mineralisation appears to occur where quartz veins have formed in a number of

brecciating events. The Z20 has undergone at least two stages of brecciation. Microscopic

examination of lode samples reveals this process has occurred at all scales, with even

individual sulphide grains commonly showing evidence of multiple stages of brecciation.

Visible gold is present in many Main Lode intercepts (Plate 4). In most cases, it occurs

interstitially with quartz in axial planar breccia veins, and in rarer cases associated with

arsenopyrite. Gold observed in hand specimen is associated with vein quartz and brecciated

arsenopyrite, implying that gold is associated with the brecciating/veining events.

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Zapopan Resource Report, August 2003 9

5.0 PREVIOUS BURNSIDE JV RESOURCE CALCULATIONS

5.1 VERSION 1 During March 2003 the Zapopan block model, as supplied by MRT, was recreated in Surpac

by Peter Harris. During this exercise it was noted that the methodology of applying an assay

topcut used by MRT (ie., applying the cut to the composited interval grade) differed

substantially from the usual practice of cutting the individual assay values (or individual assay

composites) prior to compositing.

Table 1 illustrates the differences in the average lode-grade for two diamond holes. These

two holes intersect the ore body at the 940RL and account for a significant proportion of the

contained metal of the resource. A discrepancy of 11.78g/t and 13.88g/t in favour of the MRT

method is evident for ZAPRD668 and ZARD665 respectively.

Table 1 Effect of MRT Top-cutting Methodology

Hole ID Uncut Uncut topcut applied to

interval (MRT) topcut applied to

assay values MRT Harmony MRT Harmony

ZAPRD668 4.30m @ 68.14 4.30m @ 66.16 4.30m @ 30.0 4.30m @ 18.22

ZAPRD665 2.90m @ 35.08 2.90m @ 35.37 2.90m @ 30.0 2.90m @ 16.12

To analyze the effect of the topcut methodology on the overall resource grade, a new block

model was generated using the same wireframe interpretation and ID2 interpolation as used

by MRT.

The main features of the MRT model and the Harmony are:

MRT Harmony 30g topcut applied to whole interval Gemcom Model - 30g topcut applied to individual 1m composites Surpac Model - 30g topcut applied to individual assays seam model regular block model total undiluted resource: total undiluted resource:

168,000t @ 18.34g/t 166,000t @ 13.86 g/t (A. Gillman, 2003, Gemcom) (M. Young, 1999, Vulcan) 163,000t @ 13.70 g/t (P. Harris, 2003, Surpac)

In Feb 1998, MRT reported a resource estimate of 181,000t @ 13.80g/t (no top cut

mentioned). With no additional drilling between this report and the March 1999 report the

average resource grade increased by about 5g/t. There is no explanation in the latter MRT

report for the increased grade.

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Zapopan Resource Report, August 2003 10

5.2 VERSION 2 - LENS MODEL Following the completion of the 1000 level development, the available face mapping was

incorporated in a revised model. In addition, the mineralized zones of the historic diamond

core were relogged using the “Z” nomenclature. These data were loaded into the drillhole

database. All subsequent face sampling and underground diamond logging incorporated this

nomeclature. Every individual ore zone assay value in the database was assigned a Z value.

In the version 2 model:

• individual wireframes were created for each Z-lens

• basic univariate geostatistics were carried out on individual lens or domains

• Individual topcuts were determined for each domain

• an average grade for the internal waste was assigned by averaging all the assay

values located between the Z lenses

• the model incorporated an extrapolated geological envelope based on the 1000 level

mapping

• a new model of the Central Lode was created

• a new model of the Fissure Lode was created

This model was sliced into irregular horizontal slices according to the data density. As a result

the 930-950 level (containing holes ZAPRD665 and ZAPRD668) contained a disproportionate

amount of tonnes at a grade of 20.87g/t.

The estimated resource between the 1000 and 820 levels is tabled below.

Table 2 Version 2 Model Resource Estimate

Lode Tonnes Grade Contained Metal (Oz Au)

Main Lode 202,275 14.29 93,000

Central Lode 79,808 12.33 31,641

Fissure Lode 8,266 15.00 3,987

Total 290,349 13.78 128,628

Although this model highlighted again the effect of two holes on the overall resource grade

the overall grade of 14.29g/t is reasonably close to that determined in the version 1 model.

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Zapopan Resource Report, August 2003 11

5.3 VERSION 3 - PAY ZONE MODEL In the Version 3 model, lode wireframe boundaries were defined by the margins of what were

considered to be the "pay zone" indicated in each hole or face. For example: (Z30+Z20) or

(Z20+Z10) or (Z30+Z20+Z10).

Two face-sample lengths that crossed the whole Z package were included together with the

airleg rise.

This exercise was run purely to gauge the effects of high grading the resource and was

applied only to the Main Lode.

The model was created using databases extraction files of first and last occurrences of

particular lens tags. This is a particularly accurate method. However, the resulting solid only

extends as far the extraction points. Hence, there is a shortfall in the volume (tonnes). This

shortfall would normally be accounted for by extrapolating the solids to the full strike extent.

A 50g topcut was applied to the raw assay data and the "lode-width composite" was then

calculated between the hangingwall and footwall boundaries. These values were used in a

ID2 interpolation.

This "tightening up" of the wireframe accounts for the dramatic decrease in tonnes and the

corresponding increase in grade relative to the V.2 wireframe that was modelled to geology.

A “pay-zone” average grade with no external dilution of 17.39g/t Au was determined.

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Zapopan Resource Report, August 2003 12

6.0 RESOURCE ESTIMATION VERSION 4

6.1 METHODOLOGY All modeling and block model grade interpolations were carried out in Gemcom (GEMS 5.1).

Fleur Dyer of GeoStat Services was contracted to provide geostatistical support. This work

(Appendix 1) was carried out under Harmony supervision and according to the resource

modeling procedure developed in-house (Appendix 2).

6.2 WIREFRAME MODELLING 6.2.1 Lode Models Section-based 3D wireframes were created for the Main and Fissure lodes. Rather than using

a lower grade cut-off, the lode wireframe boundaries were defined by natural geological

boundaries, namely the footwall surface of the Z10 and the hanging-wall surface of the Z30.

Modelling these lodes was reasonably straight forward.

This definition of the lode was used as it approximates the way the deposit would actually be

mined, ie., to keep the Z5 lens in the footwall corner of the drive whilst driving on the Z10-Z30

width. This geologically-defined boundary equates to using a nominal 4g/t lower cut-off.

Much of the underground diamond drilling targeted the hinge area of Central Zone. The

geometry of this lode required the modeling to be done in level plan - a process that does not

allow automatic snapping of vertices to drillholes. As a result, this lode wireframe is not as

well defined and carries significant dilution particularly from drillhole-intersections that are

closer to the collar of the holes. These low grades could be excluded with more detailed

modeling. However, together with the thinning out of the limb,it would be fairly difficult and

time consuming. Remodelling would be justified following further drilling that would ideally be

oriented normal to the fold hinge.

6.2.2 Dilution Mode A 0.5m dilution skin around the Main Lode was also created in order to calculate the average

dilution grade. The wireframe was created by expanding the Main Lode 0.5m. Eventually all

values within a 1m skin were used with volumes and tonnes reported from the 0.5m skin.

6.2.3 Grade Domain Boundary With respect to the Main Lode a Domain Boundary separating the high-grade hinge zone from

the low-grade limb was created. This boundary is a single plane. Developing a more refined

boundary with flexures that follow the shape of the “leading edge” of the lode maybe

warranted at some stage.

Page 17: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Zapopan Resource Report, August 2003 13

6.3 DATA Data incorporates the historic exploration diamond drilling (NQ, 44mm diameter, half-core

sample) and underground diamond drilling (LTK48, 35.5mm diameter full core sample).

Assay and QAQC procedures are documented in Appendix 2.

Main Lode drillhole centroid positions are shown in Figure 4 and Plate 2. Appendix 4 shows a

complete listing of drillhole intervals used in the resource estimate.

6.4 SG DETERMINATIONS A total of 71 pyctometer SG determinations were carried out using samples from the

underground diamond drilling (Appendix 3). The average of 19 readings from samples of ore

grade material was 2.88.

An SG of 2.8 was used for the Main Lode and, because of the higher sulphide content, an SG

of 3.0 was used for the Central Lode.

6.5 TOP CUT SELECTION - MAIN LODE Various criteria were used to select a suitable topcut:

97.5 percentile 131 g inflection of the log probability plot no deviation until after about 180g/t geological observations numerous occurrences of visible gold in the

exploration (at least 2) and underground diamond drilling (17) and face sampling

The distribution of visible gold occurrences is shown in Plate 4. A topcut of 120g/t was applied to grade interpolations within the Main and Central Lodes. With

respect to the Main Lode: using top cuts of 120g and 90g produced overall average grades of

17.01 and 16.28 respectively (<5% decrease).

A total of 25 assay values, ranging from 134 to 833g/tAu were cut. A topcut of 30g/t was

applied to grade interpolations within the Fissure Lode.

6.6 GRADE INTERPOLATION Grade interpolations were carried out using 0.5m composites in the COMPAU-120 table.

In addition to applying an overall top-cut, a high-grade transition of 50g/t was used. This

means that a smaller search radius (25mx10mx5m) was applied to composite values between

50g/t and 120 g/t.

Both inverse distance squared and kriged interpolations ware run and are reported below.

Longitudinal sections of the Main Lode showing contoured average grade, horizontal

thickness and gram-metre data as derived from the block are shown in Figures 5,6 & 7.

Page 18: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Zapopan Resource Report, August 2003 14

7.0 RESOURCE CATEGORIES

The resource summaries by mining bench levels and by regular 10m levels are tabled below

(Tables 4, & 6).

There is a slight difference in the resource tonnes between the report by mining level and the

report by regular 10m levels. This is due to the mining levels not covering the full vertical

extent of the resource model.

A slight discrepancy in the overall grade (15.12 vs 15.10) is due a difference in the grade

reporting of the Central Lode. Application of an average inferred grade of 13.36 produced an

overall resource grade of 15.12 whereas the use of the calculated bench grade produced an

overall resource grade of 15.10g/t.

The volumes/tonnes that have been extracted from the 1000 and 980 development drives has

not been subtracted from these figures.

7.1 MAIN LODE Encompasses the footwall contact of Z10 lens to the hangingwall contact of the Z30 lens.

Sectional interpretation with vertices snapped to drillholes. Top ct of 120g/t used.

Resource categories were assigned by using a bench threshold of 940RL.

Above 940RL the resource is categorized as MEASURED.

Below 940RL the resource is categorized as INDICATED.

7.2 CENTRAL LODE The hinge area in the 45m interval between 950 and 995RL gives the best indication of the

average grade of the Central Lode. Consequently, the grade from this domain has been

assigned to the rest of the Central Lode. Top ct of 120g/t used.

Most of the Central Lode resource is categorized as INFERRED.

The hinge area between 1000 and 950RL is categorized as INDICATED due to the increased

sample density.

7.3 FISSURE LODE The Fissure Lode resource is categorized as INDICATED.

An estimated dilution tonnage and grade, assuming a 0.5m skin, is tabulated in Appendix 4.

Page 19: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Zapopan Resource Report, August 2003 15

8.0 CONCLUSIONS

An upgraded resource of 298,438t averaging 15.12g/t Au for 145,096oz has been defined at Zapopan. This upgrade from the earlier published figure is accounted for by:

• Additional tonnages by the inclusion of the Central and Fissure Lodes

• Increased average grade of the Main Lode due, essentially, to a higher topcut and less footwall dilution.

An increase in the topcut was justified by several geostatistical criteria but more significantly

by the numerous occurrences of coarse visible gold in the diamond core and exposed faces.

The increased data density afforded by the underground drilling produced a larger high-grade

population that appreciably decreased the nugget effect.

In addition to a more accurately defined lode morphology and position, a much better

understanding of the internal constituents of the lodes has been gained from the underground

observations and underground drilling. This information justified the exclusion of the Z5 lens

from the Main Lode model thereby reducing the dilution effect of the footwall material.

The Main Lode is now well defined for the upper 40m of the mine. The Central Lode has been

mapped and sampled on the 980 level and the Fissure Lode has been intersected in drilling

from the 1000 level.

More work is required on the Central Lode to more accurately define its margins and hence

the grade.

A comparison of the historic resource calculations with respect to the Main Lode is shown in

Table 6. Compared with the 2002 Burnside Resource and Reserve Statement (for which

there is no supporting documentation) and the initial MRT report, there is no significant

variance in the overall contained metal. There is, however a sometimes large variance with

respect to average grade.

9.0 FURTHER EXPLORATION

Within the existing resource, the best opportunity to increase profitability would be to:

• increase the ounces per vertical meter,

• explore the down plunge extension of the high grade zone.

To achieve this, more ounces need to be defined in the upper levels, and the grade of the

Main Lode shoot needs to be increased below the 940 level.

Page 20: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Zapopan Resource Report, August 2003 16

In order of priority the Central Lode and the Fissure Lode are the two that are best able to

improve the ounces per vertical metre.

Any extensions/upgrades to the Main Lode will require drilling from the surface to reach below

the 940 level. Four holes with two wedges should be sufficient to define the Main Lode. Some

of the holes should be angled to drill oblique to the Main Lode so that the Central Lode can be

intersected as well.

The hinge of the Main Lode has not been adequately tested at the 950RL. Exploration hole

ZAPRD753 literally “nicked’ the edge of the lode at this point (Figure 4). As such, the resulting

intersection of 1m @ 1.26g/tAu is not representative of the high-grade nature of the hinge

zone. This may account for the relatively low average grade of 13.76g/t reported from the

resource model at this level.

The resource, as a whole, has not been closed-off at depth. All of the deeper historic

exploration holes targeted the Main Lode, which at depth, appears to roll over and attenuate.

It is likely that the North Slide has flattened out and truncated the Main Lode at depth. This

being the case, one would expect most of the mineralization to be on the other side of the

slide ie., in the Central Lode. Deeper targeting of the Central Lode should therefore be

considered, as there is no structural reason for the resource to suddenly end.

10.0 CONSIDERATIONS FOR MINING

10.1 UNEVEN DISTRIBUTION OF GRADE/METAL ALONG LEVELS Application of the domain boundary shows that 71% of the contained metal within the Main

Lode resides in the hinge zone. A similar percentage is likely in the Central Lode.

Consequently, future mine design should be geared towards extracting this portion of the lode

most efficiently. This would also entail the repositioning of the decline further from the Central

Lode.

10.2 MINIMUM MINING WIDTH A review of the long-section contours of the Main Lode (derived by pillar compositing of the

wireframe) shows a general pinching-out of both width and average grade towards the limb or

“trailing” edge (Figures 5,6 &7).

Curtailing the development drives at about the 2m true width contour would not only reduce

the percentage of dilution in the low-grade part of the drive, but would also avoid stability

problems associated with the South Slide.

Page 21: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Zapopan Resource Report, August 2003 17

10.3 EFFECTS OF DILUTION An average Main Lode dilution grade of 0.82g is indicated between 1010 and 840RL.

Assuming 20% dilution at 0.82g/t, the average grade of the Main Lode between 1010 and

840RL is estimated at 14.34g/t Au (Table 7). Over the same interval, 26% dilution (derived

from a 0.5m skin) produces and overall grade of 12.86g/tAu.

These figures illustrate how a relatively small increase in dilution can significantly decrease

the overall grade of the resource.

10.4 LOW GRADE PODS WITHIN THE HIGH-GRADE HINGE ZONE The effects of the low-grade, hematite-altered portions of the Central Lode must be

considered as this zone occurs between the high-grade portion of the Central Lode and the

high-grade portion of the Main Lode.

10.5 MINING SEQUENCE Should the Fissure Lode prove viable, the mining sequence will need to be reviewed as the

Fissure Lode sits in the hanging wall of the Main Lode. The Central Lode can be removed

after stoping of the Main Lode.

11.0 RECOMMENDATIONS A program of surface-collared diamond holes is recommended, in order of priority, to:

• Test the Central Lode at roughly 40m vertical intervals with surface-collared diamond

holes directed at right angles to the hinge zone of the Central Lode

• Definition drilling of the Main Lode below 940RL

• At least one hole directed at the Main Lode to test the hinge zone at 950RL. The

existing intersection at this point basically missed the target and as such this zone

has been downgraded in the current model.

• Definition drilling of the Fissure Lode

• Establish a geotechnical database and undertake geotechnical logging of the historic

diamond core

Page 22: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

11360E 11400E 11440E 11480E 11520E 11560E 11600E

760RL

780RL

800RL

820RL

840RL

860RL

880RL

900RL

920RL

940RL

960RL

980RL

1000RL

1020RL

1040RL

1060RL

750RL

770RL

790RL

810RL

830RL

850RL

870RL

890RL

910RL

930RL

950RL

970RL

990RL

1010RL

1030RL

1050RL

BKRC521

BKRCD520

UZ01UZ02UZ03UZ04UZ05UZ06

UZ07UZ08UZ09

UZ10UZ11

UZ12

UZ13UZ14UZ15

UZ16UZ17UZ18

UZ19

UZ29

UZ30B

UZ31

UZ32

UZ33

UZ34

UZ35UZ36

UZ39

UZ40

UZ41UZ42

ZAPRD564

ZAPRD660 ZAPRD661

ZAPRD662

ZAPRD664A

ZAPRD665

ZAPRD667

ZAPRD668

ZAPRD732

ZAPRD733

ZAPRD736

ZAPRD737

ZAPRD749

ZAPRD750

ZAPRD751

ZAPRD752

ZAPRD753

ZAPRD770

ZAPRD771W

ZAPRD773

Average Grade Contoursfrom Drillhole Centroids

Figure 4

Main Lode Long Section

block model outline (dashed line) is slightly different to actual model outline (solid line) due to slightly different projection angle

Page 23: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

11360E 11400E 11440E 11480E 11520E 11560E 11600E

760RL

780RL

800RL

820RL

840RL

860RL

880RL

900RL

920RL

940RL

960RL

980RL

1000RL

1020RL

1040RL

1060RL

750RL

770RL

790RL

810RL

830RL

850RL

870RL

890RL

910RL

930RL

950RL

970RL

990RL

1010RL

1030RL

1050RL

BKRC521

BKRCD520

UZ01UZ02UZ03UZ04UZ05UZ06

UZ07UZ08UZ09

UZ10UZ11

UZ12

UZ13UZ14UZ15

UZ16UZ17UZ18

UZ19

UZ29

UZ30B

UZ31

UZ32

UZ33

UZ34

UZ35UZ36

UZ39

UZ40

UZ41UZ42

ZAPRD564

ZAPRD660 ZAPRD661

ZAPRD662

ZAPRD664A

ZAPRD665

ZAPRD667

ZAPRD668

ZAPRD732

ZAPRD733

ZAPRD736

ZAPRD737

ZAPRD749

ZAPRD750

ZAPRD751

ZAPRD752

ZAPRD753

ZAPRD770

ZAPRD771W

ZAPRD773

Average Grade Contoursderived from Block Model Pillar Compositing

Figure 5

Main Lode Long Section

block model outline (dashed line) is slightly different to actual model outline (solid line) due to slightly different projection angle

Page 24: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

11360E 11400E 11440E 11480E 11520E 11560E 11600E

760RL

780RL

800RL

820RL

840RL

860RL

880RL

900RL

920RL

940RL

960RL

980RL

1000RL

1020RL

1040RL

1060RL

750RL

770RL

790RL

810RL

830RL

850RL

870RL

890RL

910RL

930RL

950RL

970RL

990RL

1010RL

1030RL

1050RL

BKRC521

BKRCD520

UZ01UZ02UZ03UZ04UZ05UZ06

UZ07UZ08UZ09

UZ10UZ11

UZ12

UZ13UZ14UZ15

UZ16UZ17UZ18

UZ19

UZ29

UZ30B

UZ31

UZ32

UZ33

UZ34

UZ35UZ36

UZ39

UZ40

UZ41UZ42

ZAPRD564

ZAPRD660 ZAPRD661

ZAPRD662

ZAPRD664A

ZAPRD665

ZAPRD667

ZAPRD668

ZAPRD732

ZAPRD733

ZAPRD736

ZAPRD737

ZAPRD749

ZAPRD750

ZAPRD751

ZAPRD752

ZAPRD753

ZAPRD770

ZAPRD771W

ZAPRD773

Horizontal Thickness (m) of WireframeDerived from Block Model Pillar Compositing

Figure 6

Main Lode Long Section

block model outline (dashed line) is slightly different to actual model outline (solid line) due to slightly different projection angle

Page 25: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

11360E 11400E 11440E 11480E 11520E 11560E 11600E

760RL

780RL

800RL

820RL

840RL

860RL

880RL

900RL

920RL

940RL

960RL

980RL

1000RL

1020RL

1040RL

1060RL

770RL

790RL

810RL

830RL

850RL

870RL

890RL

910RL

930RL

950RL

970RL

990RL

1010RL

1030RL

1050RL

BKRC521

BKRCD520

UZ01UZ02UZ03UZ04UZ05UZ06

UZ07UZ08UZ09

UZ10UZ11

UZ12

UZ13UZ14UZ15

UZ16UZ17UZ18

UZ19

UZ29

UZ30B

UZ31

UZ32

UZ33

UZ34

UZ35UZ36

UZ39

UZ40

UZ41UZ42

ZAPRD564

ZAPRD660 ZAPRD661

ZAPRD662

ZAPRD664A

ZAPRD665

ZAPRD667

ZAPRD668

ZAPRD732

ZAPRD733

ZAPRD736

ZAPRD737

ZAPRD749

ZAPRD750

ZAPRD751

ZAPRD752

ZAPRD753

ZAPRD770

ZAPRD771W

ZAPRD773

Gram-metre ContoursDerived from Block Model Pillar Compositing

(cumulative horizontal width of lode x wighted average block grade)

Figure 7

Main Lode Long Section

block model outline (dashed line) is slightly different to actual model outline (solid line) due to slightly different projection angle

Page 26: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

minor fault

West Face South Face

hematitic alte

ration

arsenopyrite

1m

Figure 8

Face Mapping980 Level Cross-cut

Page 27: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

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7.79

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55

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5,15

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5,89

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9.37

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4,85

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6,91

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Page 28: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

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Page 29: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

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Page 30: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Version Author Cut-offs Tonnes Grade Ounces Au

2002 Burnside published resource 198,000 14.01 90,000MRT, 1998 181,000 13.80 80,315MRT, 1999 no cut off 169,000 18.55 100,802MRT, 1999 5 - 45g 164,000 18.72 98,716

v.1 Re-run of MRT model 166,056 16.36 87,353v.2 AG geological model 45g top cut 202,275 14.29 92,942v.3 AG,pay zone model 17.39v.4 AG, 2003 Burnside published resource 120 top cut 173,375 17.01 94,840

Average of All estimates excluding v.3 179,101 16.00 92,138Variance (v.4 figure from Average) -5,726 1.01 2,702

Average of Previous estimates excluding v.3 180,055 15.84 91,688Variance (v.4 figure from average of previous estimates) -6,680 1.17 3,152

Table 6

Resource Comparisons - Zapopan Main Lode

Page 31: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

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Page 32: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

domain boundary

hingedom

ain

limb

domain

hingedom

ain

limb

domain

Plate 1General oblique 3D view looking towards grid NW

(slides omitted for clarity)

Plate 2Oblique 3D view of the Main Lode

showing internal 20g iso-surface anddrillhole centroids (blue spheres)

Plate 3Close-up 3D view of the Main Lode

showing internal 20g iso-surface anddrillhole centroids (spheres)

Plate 4Oblique 3D view of the lode system

showing occurrences of visible gold (spheres)

Central Lode

MainLode

Fissure Lode

decline

Central Lode

MainLode

Fissure Lode

decline

Main Lode

20g block-modelisosurface (red)

north

east

1000

980

Page 33: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 1

Appendix 1

Geostatistical Modelling Report

F. Dyer BSc(Hons), MAusIMM, MAIG

GeoStat Services

Page 34: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 2

Table of Contents

1.0 INTRODUCTION ............................................................................................................ 3

2.0 DATA.............................................................................................................................. 3

3.0 WIREFRAMING.............................................................................................................. 4

4.0 STATISTICS................................................................................................................... 4

4.1 COMPOSITING OF SAMPLE DATA ..................................................................................... 4 4.2 TOP-CUTTING OF SAMPLE DATA ...................................................................................... 4 4.3 DESCRIPTIVE STATISTICS............................................................................................... 5 4.4 SPATIAL DISTRIBUTION OF DATA .................................................................................. 11

5.0 VARIOGRAPHY ........................................................................................................... 12

TABLE 5.1 MAIN LODE MODEL VARIOGRAM PARAMETERS, ZAPOPAN DEPOSIT13

6.0 BLOCK MODELLING AND GRADE INTERPOLATION............................................. 15

6.1 BLOCK SIZES AND MODELLING PARAMETERS ................................................................. 15 6.2 BLOCK MODEL VALIDATION ........................................................................................... 17

6.2.1 Global statistical validations............................................................................... 17 6.2.2 Grade/Depth validations .................................................................................... 18

7.0 RESOURCE CLASSIFICATION AND REPORTING................................................... 24

7.1 METHODOLOGY........................................................................................................... 24 7.2 RESULTS..................................................................................................................... 25

8.0 ADDITIONAL MODELLING......................................................................................... 26

8.1 MAIN LODE VARIATIONS............................................................................................... 26 8.2 KRIGING VALIDATION OF ID2 MODEL .............................................................................. 27 8.3 DILUTION MODEL......................................................................................................... 28

9.0 RECOMMENDATIONS ................................................................................................ 28

Page 35: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 3

1.0 INTRODUCTION

Geostat Services (GS) was commissioned by Harmony Gold Operations Ltd (Harmony) to

undertake a geostatistical resource estimate of the underground Zapopan deposit in July

2003. This deposit comprises part of the Burnside Project area, located approximately 280km

south of Darwin in the Northern Territory, Australia. The aim of this work was to provide a

geostatistical resource of the Zapopan underground orebody, using the latest available drilling

assays and the greater understanding of the deposit geology.

2.0 DATA

Geostat was provided with a Gemcom project comprising drillhole collar, assay, wireframe

and survey data covering the Zapopan deposit by Harmony. Drillholes comprise a mixture of

types, including RC and diamond holes, with a total of 64 holes covering 7,854m. Hole

depths vary from 5.5m to 396m, with an average depth of 122m. Validation of the database

was not performed, as this was considered to have been completed by Harmony prior to

receiving the data. It was not within the scope of the brief to assess data quality and integrity.

No information was provided regarding different analytical procedures and all assays have

been processed as one dataset. It was also not within the scope of the brief to analyse for

potential bias introduced by different drilling and sampling techniques over the drilling history

of the deposit, however Geostat does not expect there to be any problems.

Drillhole data spacing is variable, with an average spacing of 50m along-strike and 20m

across-strike. Areas of smaller drillhole spacings occur locally throughout the deposit, with

underground fan drilling providing irregular coverage of local areas. The majority of holes are

oriented towards the north, with an average dip of -60°.

The database comprises a mixture of holes, with both surface RC drillholes and underground

decline fan drilling both incorporated into the resource dataset. Table 2.1 illustrates the

breakdown of drillholes that intersect the mineralisation wireframes comprising the Zapopan

deposit, and number of metres and composites within these wireframes. Previous resources

have utilised only the surface RC drillholes, with this resource using additional assay

information from underground fan drillholes.

Page 36: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 4

Drillhole Type Number of Holes Metres No of Composites BKRC 2 13 26

ZAPRD 20 82.5 170 ZRC 1 2.5 5 UZ 36 357.3 738

TOTAL 59 455.3 939

Table 2.1 Breakdown of drillhole data constrained by wireframes, Zapopan deposit

3.0 WIREFRAMING

Three grade envelopes were delineated for the Zapopan deposit by Harmony, using the

approximate geological boundaries of broad quartz veins, which equates to a rough 1.5g/t Au

cut-off. The Zapopan orebody characterises an asymmetric anticlinal fold, with the nose

plunging approximately -50° towards 110°. The Main Lode (100) is located on the southern

flank and hinge of this fold, and carries the majority of high-grades within the Zapopan

deposit. The Central Lode (200) represents a faulted component of the hinge and northern

flank of the fold, and a third lode, the Fissure Lode represents minor mineralisation on the

hanging wall of the southern limb (300). Sectional interpretations were made using both

vertical sections and plan views, based on sample Au grades. These interpretations were

linked to form solids and validated.

4.0 STATISTICS 4.1 Compositing of sample data Sample intervals within the exploration database were examined to determine the dominant

sample length. Two main intervals of 0.5m and 1.0m dominated the sample length

distribution, accounting for 22% and 23% of the total range of sample lengths respectively.

As the deposit is characterised by narrow lodes, with thin quartz veins defining gold

mineralisation, 0.5m was chosen as the appropriate interval for composition. Thus, the data

was composited to 0.5m intervals, honouring drillhole-wireframe intersections.

4.2 Top-cutting of sample data Sample data within the Zapopan combined drillhole database was assessed for the need of a

top-cut to be applied to data prior to grade estimation. The determination of a high-grade cut

is made on the basis of probability plots, with the general criteria for the top-cuts being a marked change, a kink, or pronounced disintegration at the higher end of the probability

distribution.

Page 37: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 5

Since the Zapopan deposit comprises significant numbers of high-grade samples, with high

coefficients of variation, top-cutting of Au data is necessary to reduce the impact of extreme

values on estimation of Au grades. The Main Lode is characterised by a continuous linear

probability distribution curve, up to around 120-140g/t Au where it starts to disintegrate, and

an inflexion is indicated at around 180g/t Au. The Central Lode probability plot demonstrates

two inflexions, one at 50g/t Au, and the other at around 120g/t Au. Thus, 120g/t Au was used

as a top-cut for both the Main Lode and Central Lode. Samples comprising the Fissure Lode

are of lower-grade, with a weak inflexion occurring at around 20-30g/t Au, thus a top-cut of

30g/t Au was applied for the Fissure Lode.

Top-cutting of sample and/or composite grades is a sensitive issue at Zapopan, with its

nature of very high sample grades providing a significant impact on interpolated block grades

and their distribution. Samples were investigated as to the impact of top-cutting prior to

compositing of samples, as opposed to the more traditional method of top-cutting after

compositing. Samples within the Main and Central Lodes were cut to 120g/t and then

composited to 0.5m, and for the other scenario, samples were composited to 0.5m and then

top-cut to 120g/t. As an example, drillhole UZ30B was examined over the composite interval

of 97.35m to 97.85m, with two assays straddling this interval, one of 195g/t Au from 97m to

97.6m, and the other assay of 13.5g/t from 97.6m to 98m. Compositing over this interval

resulted in a value of 66.75g/t Au using pre-cut assays, as compared to a composite of

104.25g/t Au using raw uncut assays. As this raw composite falls below the top threshold of

120g/t, it effectively ‘escapes’ the post-composite top-cutting process and thus remains uncut

through the entire modelling process. The impact of top-cutting assays prior to compositing is

greatest on boundaries of very high-grade areas, where composite intervals comprise a

mixture of the high-grade intervals, and lower-grade adjacent intervals. Hence, top-cutting of

samples prior to compositing has a significant impact on the modelling process and forms a

critical process for the magnitude of resultant block grades.

4.3 Descriptive Statistics

Statistics were run within the drillhole database for all constrained uncut sample and pre-cut

composite data by envelope, and are presented in Table 4.1. No other mineralisation

indicators were used, as data was extracted from within wireframes.

Page 38: Burnside Operations Pty Ltd · Z5, Z10, Z15, Z20 and Z30 • Z5 is a pyritic laminated unit of up to 40cm thick with an average grade of 9.45g/t Au. • Z10 is a pyritic quartz-reef

Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 6

100 200 300 Parameter/Lode Uncut

Samples Pre-cut Comps (120g/t)

Uncut Samples

Pre-cut Comps (120g/t)

Uncut Samples

Pre-cut Comps (120g/t)

Number 387 517 409 349 48 73 Minimum 0.03 0.03 0.00 0.02 0.11 0.29 Maximum 228 120 833 120 48.1 30

Mean 17.10 15.79 17.29 12.65 7.38 7.00 Median 5.04 6.20 0.87 1.88 3.70 4.13

Standard Deviation 34.1 24.2 66.0 24.1 10.4 7.7 Variance 1163.8 585.0 4355.7 581.0 108.0 58.8

Coefficient Variation 2.00 1.53 3.82 1.91 1.41 1.10 97.5 Percentile 130.3 92.2 138.6 91.5 33.6 30.0

Table 4.1 Sample and composite statistics within solids (g/t Au)

Location statistics of composite data reveal the Main Lode to have the highest gold grades

within the Zapopan orebody, with an average of 15.79g/t Au. The Central Lode has the

highest maximum gold grade of 833g/t Au at Zapopan, but with a lower average grade of

12.65g/t Au. This lode has a very low median grade of 1.88g/t Au, with the highest variance

out of all the lodes. Essentially, samples comprising the Central Lode are predominantly

lower-grade, with a small number of very high grades inflating the mean grade and creating a

very large coefficient of variation. The Fissure Lode comprises a very small dataset, with a

mean grade of 7g/t Au.

The coefficient of variation (CV) describes the variability of data relative to the raw average

grade, and in general, values above 1.0 will indicate that problems may be caused by

extreme values. CV values also provide an indication of the need for top-cutting prior to

interpolation. However, the coefficient of variation assumes an underlying normal distribution,

thus its application is limited. All solids show very high coefficient of variation values,

indicating that extreme values are likely to be problematic during interpolation of Au grades.

Composite data for each lode was also examined to see whether a pre-composite top-cut of

90g/t Au would have a considerable impact of lowering the CV. Table 4.2 lists the CVs

obtained for sample data cut to 90g/t Au as compared to 120g/t Au prior to compositing.

While a 90g/t Au top-cut does slightly lower the coefficient of variation for the Main and

Central Lodes, it still remains high, and as such, there remains little difference between using

a 90g/t or 120g/t Au top-cut in terms of the coefficient of variation.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 7

Lode CV using 90g/t Au top-cut

CV using 120g/t Au top-cut

Main Lode 1.42 1.53 Central Lode 1.79 1.91 Fissure Lode 1.10 1.10

Table 4.2 Coefficients of variation using 90g/t Au and 120g/t Au top-cuts

The distribution of samples indicates the presence of mixed populations for all lodes, as

shown by statistical plots in Figures 4.1 to 4.3. The Central Lode in particular shows a high

degree of population mixing, and reflects the irregular drilling density throughout the lode, with

clustered samples in one area and sparse drilling at depth. The Fissure Lode histogram is

compromised by a lack of sample data, with an irregular distribution of samples present.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 8

Figure 4.1 Normal and log histograms, and lognormal probability plots – Main Lode

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 9

Figure 4.2 Normal and log histograms, and lognormal probability plots – Central Lode

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 10

Figure 4.3 Normal and log histograms, and lognormal probability plots – Fissure Lode

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 11 4.4 Spatial Distribution of Data The Zapopan deposit contains composite data at various locations, with varying degrees of

data density. Composite locations were examined to gain an insight into the data density of

each lode by bench, and Table 4.3 lists the number of composites by mining bench, together

with the average composite grade per bench.

MAIN LODE CENTRAL LODE FISSURE LODE Mining Bench

Toe No of

Composites Average Grade

No of Composites

Average Grade

No of Composites

Average Grade

1020 6 6.10 1010 5 7.07 1005 21 12.98 5 3.32 1000 65 12.24 26 5.51 985 148 10.35 37 6.28 25 9.76 980 20 21.71 965 45 32.12 141 3.88 2 5.08 960 23 8.26 72 21.93 4 6.38 950 51 15.83 75 23.02 935 80 20.30 9 25.43 930 7 26.42 5 4.87 915 18 14.69 910 895 9 17.00 890 880 865 5 6.90 860 7 11.78 845 3 3.97 840 10 17.63 825 5 30.66 10 7.50

TOTAL 517 15.79 349 12.64 73 7.00

Table 4.3 Number of composites by mining bench, Zapopan deposit

The majority of composites within the Main Lode are located between the 1000-935mRL

benches, with benches 965RL (32.12g/t Au) and 930RL (26.42g/t Au) comprising the highest

average composite grades. The average composite grade of 30.66g/t Au for the 825mRL

bench is based on only five composites; one of which is 64.6g/t Au, hence inflating the

average bench grade.

Most Central Lode composites are located between the 965-950mRL benches, with a large

gap down to the 825mRL bench where 10 composites are located. This large gap will

potentially cause problems with grade interpolation, due to the large uninformed areas and

high degrees of extrapolation required. Highest average composite grades within the Central

Lode are located between the 960-935mRL benches, ranging from 21.93g/t Au to 25.43g/t

Au.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 12 The Fissure Lode is defined by composite data mainly between the 1000-985mRL benches,

with a small number of composites located above and below these benches. The Fissure

Lode is characterised by lower grades than those of the Main and Central Lodes, with the

highest average bench grade of 9.76g/t Au on the 985mRL bench.

A breakdown of composite numbers and average grade by 10m bench is also provided in

Table 4.4.

MAIN LODE CENTRAL LODE FISSURE LODE Toe RL No of

Composites Average Grade

No of Composites

Average Grade

No of Composites

Average Grade

1040 5 5.27 1030 1020 1010 6 7.60 1000 86 12.42 31 5.15 990 136 10.57 34 6.62 15 9.67 980 32 16.51 3 2.36 10 9.89 970 36 31.75 58 3.81 2 5.08 960 32 15.38 155 12.29 4 6.38 950 51 15.93 75 23.02 940 39 8.21 2 39.87 930 48 31.01 12 14.46 920 15 16.75 910 3 4.42 900 9 17.00 890 880 870 5 6.90 860 7 11.78 850 840 13 14.48 830 5 30.66 10 7.50

TOTAL 517 15.79 349 12.64 73 7.00

Table 4.4 Number of composites by 10m levels, Zapopan deposit

5.0 VARIOGRAPHY

Variography analysis using traditional variograms was performed on assay data for the

resource model. Composites within the Main Lode of the Zapopan orebody were used to

determine variography parameters for the resource model, as variography of the Central Lode

was considered unreliable due to the irregular density of data, and insufficient data was

present for the Fissure Lode.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 13 Interpretation of variogram fans in the horizontal plane for the Main Lode showed an east-

west strike, with across-strike plan interpretations showing a dip of -60° to the south. A

plunge of -50° towards 110° was interpreted, verifying the visual trend of the wireframe.

Variograms with two spherical structures were modelled, with results in Table 5.1. The quality

of variograms was only fair, due to the relatively low data levels and lack of data continuity.

A low nugget effect of 10% of the total variability was present, which suggests that the current

sampling methods are reasonable and no significant error is being introduced through drilling

and sampling. A maximum range of 85m was demonstrated by the plunge direction, with a

maximum across-strike range of 25m and 2.5m downhole. These ranges of grade continuity

reflect the shape of the mineralisation wireframe, with the long axis oriented down-plunge.

Nugget Effect Sill 1 Range 1* Sill 2 Range 2*

0.10 0.50 40m x 20m x 1.5m 0.40 85m x 25m x 2.5m *Note: Ranges are expressed in metres as strike x down-dip x downhole

Table 5.1 Main Lode model variogram parameters, Zapopan deposit

Variogram model plots for the Main Lode are included as Figure 5.1.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 14

Au Horizontal Normal Variogram Bearing 90 Dip 0

Au Vertical Normal Variogram Bearing 180 Dip 60

Au Downhole Log Variogram Downhole

Au Plunging Normal Variogram Strike 90 Dip 60S Plunge 50 E

Figure 5.1 Variogram models for Main Lode –Zapopan deposit

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 15 6.0 BLOCK MODELLING AND GRADE INTERPOLATION

6.1 Block sizes and modelling parameters Block size dimensions were considered for the Zapopan deposit, taking into account drilling

density and distribution of assay data within wireframes. A block size of 10m x 2m x 5m

(along-strike x across-strike x RL) is recommended as being the optimum block size, given

the average drill spacing of 50m along-strike throughout the deposit. As all the lodes are

narrow in width, a block size of 2m in the across-strike dimension was considered to best fit

this variable width, despite the across-strike drill spacing of 20m..

Block model origin and extents are defined below in Table 6.1.

Model Limits Extent of Model No of Blocks Block Size 1290-1490N 200m 100 2m

11300-11640E 340m 34 10m 1080-800mRL 280m 56 5m

Table 6.1 Zapopan Resource Model Extents

A percent model method was used, which calculates the percent of a block as belonging to a

particular lode rockcode for use in volume/tonnage calculations. The narrow, thin nature of

the lodes at Zapopan makes this method ideal and eliminates over-estimation of tonnage

whilst maintaining the same grade interpolation as that for the standard block modelling

method. The solid wireframes were used to limit the blocks available for grade interpolation.

Inverse distance interpolation (ID) using a power weighting of 2 was used to estimate Au

grades for the Zapopan deposit. Ordinary kriging, using parameters derived from the

traditional variograms was also used to validate interpolated grades from the inverse distance

model, and for comparison of final model grades.

Each lode was treated as a separate hard boundary, restricting the Au grade interpolation to

drillhole data located within each envelope. A minimum of 2 composites and a maximum of

15 composites were used to interpolate each block grade for all lodes. A discretisation array

of 5 (north) by 2 (east) by 5 (RL) was used to refine the kriging weights for each model block.

A search ellipse is used to select the samples to estimate a particular block, and is generally

matched to the maximum range parameters modelled in the variography. All lode search

ellipses were virtually identical to variography maximum range parameters determined for the

Main Lode, with dimensions of 85m (E) x 25m (N) x 7.5m (RL). A further constraint on the

search ellipses for interpolation of high-grades was necessary to limit the effects of the large

along-strike variability present in the Zapopan deposit. High grades above 50g/t Au were

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 16 subject to a restricted search ellipse of 25m x 10m x 5m, in order to minimise excessive

smearing of high grades into adjacent uninformed areas.

The search ellipse orientations are usually based on strike and dip directions determined from

fan contours and variograms during variography analysis of the dataset. However, since the

variography parameters for the Central and Fissure Lodes are derived from those for the Main

Lode, some fine-tuning of the search ellipse orientations was required to best fit the actual

geometry of the individual lodes. Table 6.3 below lists the strike, dip and plunge orientations

employed for each lode.

Lode Strike Dip Plunge Main Lode 090° -60°/180° -50°/110° Central Lode 330° -55°/060° -40°/110° Fissure Lode 090° -55°/180° -40°/110°

Table 6.3 Strike and dip orientations for all lodes – Zapopan deposit

A second interpolation pass was conducted for all lodes, with the search extents doubled in

an attempt to fill any remaining unfilled blocks. Only those blocks unfilled were interpolated

by this second pass, and grades estimated from the first interpolation pass were left

unchanged. All blocks were filled after this second interpolation passes.

The Central Lode is characterised by data clusters in the hinge area, with the lode defined by

sparse drillholes at depth. These isolated composites at depth were considered to have an

undue influence on interpolated grades, impacting on greater numbers of blocks than other

composite grades in areas of higher sampling density, as the adjacent blocks are relatively

uninformed, with no data present down-dip or on adjacent sections/planviews to constrain

these grades. Hence, grade interpolation for the Central Lode was limited to the southern

side, from 995-950mRL, with a surface boundary to the north. Figure 6.1 illustrates the

Central Lode looking along-strike in perspective view, with the modelled area highlighted in

pale blue as compared to the rest of the Central Lode in dark blue. Composites are also

illustrated as black points, and emphasise the sparsity of data within this lode. Blocks falling

outside the modelled area were allocated the weighted average modelled grade of this area,

13.36g/t Au in the absence of a reliable model grade.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 17

Figure 6.1 3D perspective view of Central Lode, with modelled area highlighted in pale blue.

6.2 Block model validation

The Zapopan block model was validated by several methods, including visual validations on-

screen, global statistical comparisons of input and block grades, and local grade/depth

relationships. The model was validated visually by viewing vertical sections and plans of the

block model, with spatial comparison of interpolated block grades against input composite

grades to ensure grade trends were represented correctly.

6.2.1 Global statistical validations

Input average composite grades were statistically compared with mean block grades by

lode below 1020mRL, with summary results tabulated in Table 6.4 below. As the

1020mRL is the upper limit for the underground drives, comparisons were done below

this depth.

Lode Number of Composites

Block Volume

Block mean grade

Composite mean grade

% difference

100 517 61,920 17.01 15.79 7.7% 200 349 32,051 13.36 12.64 5.7% 300 73 10,341 9.43 7.13 32.3%

Table 6.4 Statistical validation of Au interpolated grades –Zapopan deposit

Reconciliations between average input composite grades and mean block grades are

generally good, apart from those for the Fissure lode. This lode is based on limited

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 18

numbers of drillhole intercepts, all located along the northern side of the solid. High

composite grades are located at the southern limits of the drillhole intercepts, thus

creating a high-grade edge effect and elevation of block grades. These high grades

influence a greater number of blocks than other composite grades at higher depths,

as the blocks beneath the drilling are relatively uninformed. Hence, the average

block grade is likely to be higher than the sample average grade. Figure 6.2

illustrates this edge-effect, with high-grade composites outlined in red and magenta

clearly visible at the southern extremities of drillhole intercepts. Differences between

average composite and model grades for the other lodes are attributed to the uneven

composite data distribution throughout the lodes, with clusters of composites in some

areas, and relatively sparse data in other areas.

Figure 6.2 3D perspective view of Fissure Lode, with composites highlighted in colour.

6.2.2 Grade/Depth validations

Figures 6.2 to 6.3 illustrate the grade/depth relationship for the Main and Fissure lodes

respectively within the Zapopan deposit. The Central lode was not compiled, as a very

limited area of this lode was modelled. Both input composite data and model grade

data were averaged within 10m RL increments for each lode group, and plotted

together with the number of composites to assess the reliability of the block model.

Comparison of model grades with composite grades for the Main Lode above 900mRL

(Figure 6.2) illustrate a reasonable reconciliation, with model grades attempting to

reproduce the fluctuations in composite grades. A smoothing of grades is present

below the 900mRL, with model grades slightly over-estimating the erratic input

composite grades.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 19

Figure 6.3 illustrates a smoothing of composite grades by the model for the Fissure

Lode. An information/edge effect is present within this lode, with low numbers of high-

grade composites influencing a large number of model blocks.

Figures 6.4 and 6.5 illustrate the grade/easting relationship averaged within 25m

easting increments for both input composite data and model grade data, together with

the number of composites for the Main and Fissure Lodes respectively. The Main Lode

shows a good correlation between model and input composite grades by easting, with

the exception of 11525E. Six composites are located at this easting, of which four

composites comprise grades of 120g/t Au. As such, the composite grade is elevated

relative to the model grade, which has been constrained by the application of a high-

grade restricted search ellipse.

The grade/easting relationship for the Fissure Lode (Figure 6.5) should be treated with

caution, as sample data is present over a limited area of 50m. Model grades are

elevated respective to composite grades, which is attributed to the information/edge

effect. High grades on the edges of drillhole intercepts to the south had a

disproportionate influence on the model grades, particularly with few other composites

to control grade interpolation. More infill drilling would help constrain the influence of

these high grades, and provide more data for improved interpolation and resulting

confidence.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 20

ID2 Resource Model Validation - Main LodeAu Grade vs Depth

0

5

10

15

20

25

30

35

40

81082083084085086087088089090091092093094095096097098099010001010

Depth RL

Au

Gra

de

0

23

46

69

92

115

138

161

184

No

of C

ompo

site

s

Average model grade

Average composite grade

No of Composites

Figure 6.2 Au Grade vs Depth validation plot – Main Lode, Zapopan deposit

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 21

ID2 Resource Model Validation - Fissure LodeAu Grade vs Depth

0

2

4

6

8

10

12

14

93094095096097098099010001010102010301040

Depth RL

Au G

rade

0

5

10

15

20

25

30

35

No o

f Com

posi

tes

Average Model Grade

Average Composite Grade

No of Composites

Figure 6.3 Au Grade vs Depth validation plot – Fissure Lode, Zapopan deposit

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 22

ID2 Resource Model Validation - Main LodeAu Grade vs Easting

0

10

20

30

40

50

60

70

11375 11400 11425 11450 11475 11500 11525 11550 11575 11600

Easting

Au G

rade

0

26

52

78

104

130

156

182

No o

f Com

posi

tes

Average Model Grade

Average Composite Grade

No of Composites

Figure 6.4 Au Grade vs Easting validation plot – Main Lode, Zapopan deposit

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 23

ID2 Resource Model Validation - Fissure LodeAu Grade vs Easting

0

1

2

3

4

5

6

7

8

9

10

11325 11350 11375 11400 11425 11450

Easting

Au G

rade

0

10

20

30

40

50

60

70

Average Model Grade

Average Composite Grade

No of Composites

Figure 6.5 Au Grade vs Easting validation plot – Fissure Lode,, Zapopan deposit

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 24 7.0 RESOURCE CLASSIFICATION AND REPORTING The Mineral Resource for the Zapopan deposit has been classified in accordance with the

guidelines outlined in the “Australian Code for Reporting of Identified Mineral Resources and

Ore Reserves” (JORC). Assessment criteria include drill spacing, sample locations,

geological confidence and grade continuity. Resources within the Zapopan deposit are

classified as Measured, Indicated and Inferred, following the classification given in the

guidelines. An Inferred category was applied to all lodes below 885mRL, as few drillhole

intercepts are located within this zone, and there is uncertainty in lode continuity with poor

definition by drilling. Blocks within lodes at these depths were often interpolated by composite

data from sole drillhole intercepts without supporting composite data along strike or down-dip,

and thus an Inferred category was considered appropriate for these blocks.

7.1 Methodology The Zapopan resource has been classified into Measured, Indicated and Inferred categories

according to the JORC code, using a combination of drillhole spacing, sampling density,

sample locations, wireframe geometry and confidence in grade continuity between drill

sections. Within the Main Lode, a boundary of 940mRL was used to separate Measured and

Indicated blocks. Above 940mRL, sample density is reasonable, with good reconciliation

between composite and model grades. Hence, confidence in this area is relatively high, and

a Measured category was applied to these blocks. An Indicated category was applied to

those blocks located below 940mN. These blocks were interpolated by fewer composites,

with sparse sampling density, thus an Indicated category was considered appropriate for

these blocks.

The Central Lode has been classified as Inferred. Sampling density within this lode is low,

with irregular sample locations and poor definition of the limb and hinge. Since only a limited

area of this lode was modelled, with the average modelled grade (13.36g/t Au) applied to the

rest of the lode, an Inferred category was considered appropriate.

An Indicated category was applied to the Fissure Lode, as a result of closed-spaced sample

locations over a small wireframe area.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 25 7.2 Results The classified Mineral Resource as reported in Harmony’s June 2003 quarterly report is

tabulated in Table 7.1 as at 28th July 2003. A density of 2.8t/m3 was used to report the Main

and Fissure Lodes, with 3.0t/m3 used for the Central Lode to account for its higher sulphide

content.

Category Volume Tonnage Au g/t Measured 26,887 75,285 17.78 Indicated 52,809 147,866 14.67 Inferred 25,096 75,287 13.36 Total 104,792 298,438 15.12

Table 7.1 Zapopan Classified Mineral Resource as at 28th July 2003

A breakdown of this model resource by mining benches, and regular 10m levels is included

as Appendix 1. It should be noted that the mining bench report has slight differences in

tonnage and grades to that by 10m levels. The mining bench report is reported to an upper

depth limit of 1020mRL, whereas the report by 10m levels covers the full vertical extents of

each lode.

Figure 7.1 illustrates the grade-tonnage relationship for all combined lodes for Zapopan at a

range of cut-off grades, to test the sensitivity of the model to the cut-off grade applied. Cut-off

grades are bracketed next to points representing the tonnage and average grade applicable

at these cut-off grades. A grade-tonnage relationship was also determined for the Main Lode,

as illustrated in Figure 7.2.

Grade-Tonnage Curve, All Lodes, Zapopan DepositJuly 2003

(2.5g/t)(0g/t)

(5g/t)(7.5g/t)

(10g/t)(12g/t)(13g/t)

(13.5g/t)(14g/t)

(15g/t)(17.5g/t)

(20g/t)

(25g/t)

(30g/t)

10

15

20

25

30

35

40

45

0 25,000 50,000 75,000 100,000 125,000 150,000 175,000 200,000 225,000 250,000 275,000 300,000 325,000 350,000

Tonnage

Au G

rade

Figure 7.1 Grade Tonnage Curve for all lodes, Zapopan deposit

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 26

Grade-Tonnage Curve, Main Lode, Zapopan DepositJuly 2003

(30g/t)

(25g/t)

(20g/t)

(17.5g/t)(15g/t)

(14g/t)(13g/t)

(12g/t)(10g/t)

(7.5g/t)

(5g/t)(2.5g/t)

15

20

25

30

35

40

45

20,000 45,000 70,000 95,000 120,000 145,000 170,000

Tonnage

Au G

rade

(0g/t)

Figure 7.2 Grade Tonnage Curve for Main Lode, Zapopan deposit

8.0 ADDITIONAL MODELLING 8.1 Main Lode Variations A nominal surface was constructed for the Main Lode, dividing the high-grade hinge and

upper limb area from the lower-grade limb of the lode, as illustrated in Figure 8.1 below.

Figure 8.1 3D perspective view of Main Lode, with nominal surface in black.

The aim of this surface was to provide an additional control on grade interpolation by acting

as a hard boundary. The lode portions above and below the surface were coded separately,

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 27 and the resource model re-run, with input composites limited to their respective codes. All

other modelling parameters were identical to those imposed on the original model, including

that of a high-grade restricted search ellipse with the same dimensions.

The resultant model grade was almost identical to that of the original model, with an average

grade of 22.89g/t Au for the Main lode as compared to 22.39g/t Au. The emplacement of the

boundary has created a very slight elevation of grades, principally in blocks near the

boundary where composite numbers are reduced, and no surrounding lower grades to

balance the grade interpolation.

The same model was also rerun, using the surface as a hard boundary, but without the high-

grade restricted search ellipse. An average block grade of 28.03g/t Au was realised for the

Main Lode, which was deemed too high with respect to input composite data.

The model trials above have shown that the use of the high-grade restricted search ellipse is

a vital parameter for modelling the Main Lode of the Zapopan deposit, and minimises the

need for a hard boundary to control the interpolation of high-grades. However, its use in the

Central Lode is still debatable, with a lower grade of 9.78g/t Au as compared to the original

model grade of 10.68g/t Au. More composites are needed within the Central Lode to fully test

this high-grade ellipse and determine its suitability.

8.2 Kriging validation of ID2 model Ordinary kriging, using parameters derived from the variography analysis was used to

validate interpolated grades from the inverse distance squared model, and for comparison of

final model grades. Results are summarised in Table 8.2 below.

Lode Tonnage ID2 Grade OK Grade Main Lode 173,375 17.01 16.81 Central Lode 96,108 13.36 13.17 Fissure Lode 28,954 9.43 9.14 TOTAL 298,437 15.10 14.89

Table 8.2 Comparison of inverse distance and ordinary kriged grades, Zapopan deposit

The kriged model reports a slightly lower grade of 14.89g/t Au for the Zapopan deposit, as

compared to that of 15.10g/t Au for the inverse distance model. Respective grades for each

lode are also slightly lower for the kriged model, which is likely a function of the higher

weights applied to the sill proportions of the variography to that of the nugget effect. Overall, the kriged model provides an excellent validation of the inverse distance model, and confirms

the interpolated grades achieved for each lode as being realistic and representative.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 28 8.3 Dilution Model A dilution model was required to provide an estimate of the dilution grade that could be

expected during underground mining, based on a 0.5m dilution ‘skin’ around each lode.

However, for the purposes of interpolating dilution grades within this zone, a 0.5m skin would

not have allowed sufficient input data for interpolation, and this skin was expanded to 1m to

increase input data for grade estimation. Thus, two dilution skins were created by expanding

the existing sectional envelopes 0.5m and 1.0m respectively, and solids created by linking the

expanded sectional envelopes. The 1m dilution skin was used for grade interpolation,

whereas the 0.5m dilution skin was used for reporting of interpolated dilution grades.

Inverse distance squared interpolation of dilution composite grades used identical search

ellipses and orientations to those used for the lodes, but without the application of a high-

grade restricted search ellipse. A top-cut of 4g/t Au was used for the Main and Central Lodes,

with 3g/t Au used for the Fissure Lode. The maximum number of composites for interpolation

of block grades was limited to 6, with a minimum of 2 composites. Results are tabulated in

Table 8.3 below.

Lode Dilution volume Dilution tonnage Dilution grade Main Lode 22,775 63,771 0.80 Central Lode 12,145 36,431 0.66 Fissure Lode 4,229 11,841 0.75 TOTAL 39,149 112,043 0.75

Table 8.3 Zapopan Dilution Resource as at 28th July 2003

9.0 RECOMMENDATIONS

A number of recommendations are made, in light of the completed resource model for

Zapopan, including infill drilling along-strike and across-strike, additional drilling to improve

definition of wireframes, and kriging interpolation techniques.

The current drilling density of 50m along-strike and 20m across-strike at Zapopan is sufficient

for a Measured, Indicated and Inferred classification of the orebody, following JORC

guidelines. However, the number of composites utilised for interpolation is relatively low, and

the effects of across-lode and along-strike variability are difficult to constrain with the current

data levels and drill spacing. Sectional interpretations of the lodes are often based on assays

within two drillhole intercepts, and thus there exists very little composite data to test the

continuity in each of the principal directions, particularly down-dip and across-lode. It is

recommended that infill drilling is carried out on existing drill-lines to supplement existing

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 29 drillholes, to provide information down-dip, and to infill uninformed areas at depth. Particular

areas in need of this infill drilling are:

• Southern side of Fissure Lode, and at upper levels in areas of sparse data density;

• Northern side of Central Lode between 995-950mRL, and at depth between 935-

825mRL; and

• Main Lode at depth below 935mRL.

The benefits of this infill drilling are summarised as follows:

• increased data levels within the composite database;

• reduced effects of across-lode and along-strike grade variability;

• verification of high grade areas within the orebody;

• improved quality of variograms;

• scope for classification upgrades of Indicated and Inferred areas to Measured and

Indicated areas respectively within the orebody;

• more robust wireframes.

The quality of variograms modelled for Zapopan is fair to poor, as they are compromised by

low data levels, the thin lode nature and lack of data continuity along-strike and down-dip.

The nugget effect is weakly defined due to a lack of composite data and the thin nature of the

lodes at Zapopan. The variogram structures for the three principal directions are adequate for

the current classification of the Zapopan orebody; however, more short-range definition of

spatial continuity is required in order to upgrade the respective categories within the deposit.

Infill drilling as described above would provide a more robust dataset for variography analysis,

and increase confidence in variogram parameters.

With further samples from infill drilling, and spatial continuity defined by variography, a kriged

resource is recommended for the next resource update. The mixed nature of the mineral

populations makes the kriging technique ideal for grade interpolation, which minimises the

potential over- or under-estimation of model grades by other linear methods. Inverse distance

interpolation assumes an underlying normal distribution, and does not utilise the information

obtained from the variogram, and thus the spatial correlation between samples is not taken

into account.

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Geostat Services Pty Ltd July 2003 Resource Estimate –Zapopan Deposit Page No. 30

One area of concern in the block model is the large extrapolation of the lode wireframes

below and to the south of the drillhole intercepts. Model block grades within these areas are

influenced unduly by the small number of drillhole intercepts from above, since search

ellipses have captured small numbers of composites and used these composites to

interpolate a large number of blocks. Again, infill drilling will reduce potential edge effects

created by the lack of composite data at depth.

Fleur Dyer

Consultant Resource Geologist

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APPENDIX 1a

ZAPOPAN DEPOSIT RESOURCE MODEL DETAILED REPORTS

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Zapopan Bench Report by Mining Bench

Main Lode PLANE VOLUME DENSITY TONNAGE AU GRADE -------------------------------------------------- 815Z 8 2.800 23 11.56 820Z 229 2.800 640 10.78 825Z 1,723 2.800 4,825 17.08 840Z 1,524 2.800 4,267 17.73 845Z 4,928 2.800 13,799 14.73 860Z 1,736 2.800 4,859 14.04 865Z 5,211 2.800 14,590 14.73 880Z 3,174 2.800 8,887 16.46 890Z 1,439 2.800 4,029 17.08 895Z 4,401 2.800 12,323 15.99 910Z 1,843 2.800 5,159 15.16 915Z 6,471 2.800 18,119 17.62 930Z 2,346 2.800 6,569 22.86 935Z 6,598 2.800 18,476 18.10 950Z 3,494 2.800 9,783 13.76 960Z 1,680 2.800 4,704 17.60 965Z 5,313 2.800 14,877 24.63 980Z 1,614 2.800 4,520 17.54 985Z 4,271 2.800 11,958 14.45 1000Z 1,436 2.800 4,021 12.57 1005Z 1,339 2.800 3,750 17.00 1010Z 1,141 2.800 3,196 16.92 ================================================== Total 61,920 2.800 173,375 17.01 Central Lode PLANE VOLUME DENSITY TONNAGE AU GRADE -------------------------------------------------- 810Z 572 3.000 1,716 13.28 815Z 580 3.000 1,740 13.27 820Z 603 3.000 1,809 13.32 825Z 2,059 3.000 6,178 13.31 840Z 707 3.000 2,122 13.26 845Z 2,102 3.000 6,305 13.28 860Z 686 2.999 2,056 13.28 865Z 1,978 3.000 5,935 13.26 880Z 1,240 3.000 3,719 13.28 890Z 653 3.000 1,958 13.30 895Z 2,264 2.999 6,791 13.24 910Z 903 2.998 2,709 13.23 915Z 3,146 2.999 9,436 13.25 930Z 1,212 3.000 3,634 13.30 935Z 3,760 3.000 11,277 13.27 950Z 2,057 3.000 6,170 16.35 960Z 901 3.000 2,704 16.23 965Z 1,670 2.999 5,007 13.41 980Z 373 2.999 1,120 11.16 985Z 1,943 2.999 5,827 10.24 1000Z 798 3.000 2,394 13.33 1005Z 692 3.000 2,075 13.31 1010Z 1,151 2.999 3,452 13.24 ================================================== Total 32,051 2.999 96,135 13.35 Fissure Lode PLANE VOLUME DENSITY TONNAGE AU GRADE -------------------------------------------------- 935Z 67 2.800 186 6.73 950Z 174 2.800 487 7.38 960Z 165 2.800 463 7.79 965Z 1,122 2.800 3,142 8.51 980Z 639 2.800 1,788 9.48 985Z 3,341 2.800 9,355 11.04 1000Z 1,358 2.800 3,802 9.82 1005Z 1,273 2.800 3,565 9.26 1010Z 2,203 2.800 6,167 7.67 ================================================== Total 10,341 2.800 28,954 9.43 Grand Total 104,311 2.861 298,464 15.10

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Zapopan Bench Report by regular 10m levels Main Lode PLANE VOLUME DENSITY TONNAGE AU GRADE -------------------------------------------------- 1010RL 1,141 2.800 3,196 16.92 1000RL 2,775 2.800 7,771 14.71 990RL 2,677 2.800 7,497 13.04 980RL 3,208 2.800 8,981 17.18 970RL 3,513 2.800 9,838 24.27 960RL 3,480 2.800 9,744 21.60 950RL 3,494 2.800 9,783 13.76 940RL 4,282 2.800 11,989 15.99 930RL 4,663 2.800 13,056 22.43 920RL 4,437 2.800 12,424 19.01 910RL 3,877 2.800 10,855 14.85 900RL 3,034 2.800 8,495 15.88 890RL 2,806 2.800 7,858 16.67 880RL 3,174 2.800 8,887 16.46 870RL 3,462 2.800 9,693 15.06 860RL 3,485 2.800 9,757 14.05 850RL 3,340 2.800 9,351 14.11 840RL 3,112 2.800 8,715 16.87 830RL 1,405 2.800 3,935 18.00 820RL 546 2.800 1,530 12.09 810RL 8 2.800 23 11.56 ================================================== Total 61,920 2.800 173,375 17.01 Central Lode PLANE VOLUME DENSITY TONNAGE AU GRADE -------------------------------------------------- 1040RL 194 2.994 582 12.89 1030RL 243 2.995 727 12.90 1020RL 400 2.998 1,201 13.03 1010RL 1,151 2.999 3,452 13.24 1000RL 1,490 3.000 4,469 13.32 990RL 1,443 2.999 4,328 11.04 980RL 873 2.999 2,619 9.30 970RL 988 2.999 2,964 12.69 960RL 1,583 2.999 4,747 15.47 950RL 2,057 3.000 6,170 16.35 940RL 2,485 2.999 7,453 13.25 930RL 2,487 3.000 7,459 13.31 920RL 2,174 2.999 6,520 13.23 910RL 1,876 2.999 5,625 13.25 900RL 1,570 2.999 4,711 13.24 890RL 1,347 2.999 4,039 13.26 880RL 1,240 3.000 3,719 13.28 870RL 1,309 3.000 3,926 13.29 860RL 1,355 3.000 4,065 13.23 850RL 1,389 2.999 4,166 13.27 840RL 1,420 3.000 4,261 13.28 830RL 1,399 3.000 4,198 13.30 820RL 1,263 3.000 3,789 13.32 810RL 1,152 3.000 3,456 13.28 ================================================== Total 32,888 2.999 98,646 13.34 Fissure Lode PLANE VOLUME DENSITY TONNAGE AU GRADE -------------------------------------------------- 1040RL 907 2.800 2,540 5.85 1030RL 1,234 2.800 3,454 5.91 1020RL 1,726 2.800 4,834 6.79 1010RL 2,203 2.800 6,167 7.67 1000RL 2,631 2.800 7,366 9.55 990RL 2,436 2.800 6,820 11.24 980RL 1,544 2.800 4,323 10.06 970RL 858 2.800 2,403 8.86 960RL 429 2.800 1,201 7.54 950RL 174 2.800 487 7.38 940RL 66 2.800 186 6.73 930RL 0 2.800 1 4.50 ================================================== Total 14,208 2.800 39,782 8.58 Grand Total 109,016 2.860 311,802 14.78

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Zapopan Resource Report, August 2003 31

Appendix 2

Assay and QAQC Procedures

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Sampling and Logging Procedures Mark up logging and sampling of the core was conducted by three geologists and sampling

undertaken either by themselves or by field assistants under their direction. Core markup

highlighted many areas of core loss, as to be expected in the broken ground at Zapopan,

fortunately only in one instance did core loss occur within the mineralization. Due to the difficulties

encountered during drilling, the usage of LTK48 is discouraged and for any future drilling UG it is

recommended that NQ2 be drilled.

Geological divisions were used to determine sample interval length, with no sample under 20cm

or over 1.2m being submitted. Geological units outside of the primary ore zones were sampled by

the meter and within the ore zones 0.5m core samples were taken.

The geologist marked the sample boundary and broke the core on geological foliations using a

hammer. The use of a hammer to split the core on foliation planes is recommended as only the

lithological unit intended for sampling is obtained (where the foliation is not perpendicular to the

core.)

Samples were placed in numbered calico bags, the first portion of the number denoting hole ID,

the second, the consecutive sample number, eg UZ13100: is the 100th sample taken from hole

13. Lots of five were then placed in poly weave bags and the samples were then delivered to the

NAL lab in pine creek.

QAQC As part of the QA/QC of the Zapopan model, 5% of the assays conducted by NAL on the recent

drilling program were selected for re-assay at an independent laboratory. A total of 71 samples

were selected from five separate drill holes. These samples incorporated the hangingwall, ore

zones and footwall of the central and main lode areas. The retained pulps (200g) were sent to

Amdel Limited in Perth to undergo fire assay (FA1). A 40g subsample was fused in a lead

collection fire assay then digested in aqua regia. The gold content was then determined by AAS.

The remainder of the samples were analyzed by air pycnometer to verify density values

determined in the Feb 1998 MRT resource report.

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Log scale chart showing variance between original samples, NAL and later check assays AMD,

there is little variance between the 1 – 100 g/t values with only one outlier in this region,

UZ32076, which returned 2.52 and 2.15 g/t for au1 and 2 at NAL but returned 12.7 at Amdel.

0.01

0.1

1

10

100

1000

AMD1NAL1

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Zapopan Resource Report, August 2003 32

Appendix 3

Resource Modeling Flowchart

RockGrade

KVClass

%

Creation of block models

Coding of rock model from 3D solids

Validation of rock model with 3D solid volumes

Basic Statistics

Top-cut determinations

Variography Analysis

Drillhole Database Validation

Digitising of sectional mineralisation envelopes

Creation of 3D solids, and validation

Creation of 1m composites from assay table

Extraction of composites from within 3D solids, and validation

Setup of kriging profiles

Interpolation (OK, ID2, etc)

Volumetrics Reporting Model Exports

By levelBy level, classificationBy level, grade group

Written resource model reports

Engineer/Optimisation studies

On-screen validation of model grades with

input data

Comparison of global model statistics with input data statistics

Validation plots by northing, easting

and depth

Classification using kriging variance, drilling

density, etc

Block model centroidsWeathering surfacesTopo surfacesVolumetrics

Validation

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Zapopan Resource Report, August 2003 33

Appendix 4

Resource Model Interval Table

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Model # Lode # HOLE-ID FROM TO LENGTH ROCKCODE LODE AU_NOCUT AU_120 AU_90 AU_301 1 BKRC521 104.00 108.00 4.00 100 Main 16.08 16.08 16.08 11.522 2 BKRCD520 95.00 98.00 3.00 100 Main 31.94 31.94 31.94 12.773 3 UZ01 0.00 2.56 2.56 100 Main 1.38 1.38 1.38 1.384 4 UZ02 0.00 3.19 3.19 100 Main 4.89 4.89 4.89 4.895 5 UZ03 0.00 4.00 4.00 100 Main 1.08 1.08 1.08 1.086 6 UZ04 0.00 5.00 5.00 100 Main 10.50 10.50 10.50 6.507 7 UZ05 0.00 5.10 5.10 100 Main 10.34 10.34 10.34 10.348 8 UZ06 0.00 9.45 9.45 100 Main 7.39 7.39 7.39 7.399 9 UZ07 0.65 5.00 4.35 100 Main 20.19 20.19 20.19 12.6010 10 UZ08 2.50 7.00 4.50 100 Main 7.84 7.84 7.84 7.8411 11 UZ09 3.50 8.80 5.30 100 Main 3.49 3.49 3.49 3.4912 12 UZ10 0.00 3.50 3.50 100 Main 13.12 13.12 13.12 12.0713 13 UZ11 1.26 6.40 5.14 100 Main 16.63 16.63 16.63 13.4414 14 UZ12 4.00 13.45 9.45 100 Main 9.27 9.27 9.27 6.8215 15 UZ13 0.00 2.10 2.10 100 Main 2.83 2.83 2.83 2.8316 16 UZ14 0.00 3.62 3.62 100 Main 2.98 2.98 2.98 2.9817 17 UZ15 0.00 8.80 8.80 100 Main 17.69 17.69 17.44 10.6218 18 UZ16 0.00 3.00 3.00 100 Main 17.36 17.36 17.36 11.6819 19 UZ17 0.00 3.76 3.76 100 Main 5.59 5.59 5.59 5.5920 20 UZ18 0.00 6.20 6.20 100 Main 4.06 4.06 4.06 4.0621 21 UZ19 14.00 19.55 5.55 100 Main 6.40 6.40 6.40 6.4022 22 UZ29 78.50 86.13 7.63 100 Main 18.04 14.92 13.51 10.6323 23 UZ30B 89.35 98.50 9.15 100 Main 57.52 39.43 31.35 14.2124 24 UZ31 77.17 83.88 6.71 100 Main 5.02 5.02 5.02 5.0225 25 UZ32 64.28 74.95 10.68 100 Main 9.44 9.44 9.44 8.0726 26 UZ33 65.55 70.15 4.60 100 Main 17.47 17.47 17.47 11.8827 27 UZ34 61.40 62.68 1.28 100 Main 11.09 11.09 11.09 11.0928 28 UZ35 54.36 62.00 7.64 100 Main 50.76 49.66 43.29 19.3929 29 UZ36 50.88 59.00 8.12 100 Main 26.56 26.56 25.70 14.7630 30 UZ39 84.00 93.00 9.00 100 Main 5.46 5.46 5.46 5.4631 31 UZ40 95.00 106.50 11.50 100 Main 13.98 13.98 13.98 10.2432 32 UZ41 0.00 2.00 2.00 100 Main 14.45 14.45 14.45 12.5033 33 UZ42 0.00 4.70 4.70 100 Main 10.80 10.80 10.80 10.8034 34 ZAPRD564 132.00 134.00 2.00 100 Main 13.60 13.60 13.60 13.6035 35 ZAPRD660 160.00 161.00 1.00 100 Main 9.61 9.61 9.61 9.6136 36 ZAPRD661 159.20 165.10 5.90 100 Main 9.27 9.27 9.27 9.2737 37 ZAPRD662 124.00 128.00 4.00 100 Main 9.02 9.02 9.02 9.0238 38 ZAPRD664A 204.50 207.60 3.10 100 Main 3.35 3.35 3.35 3.3539 39 ZAPRD665 176.50 179.40 2.90 100 Main 35.37 25.96 22.85 16.1240 40 ZAPRD667 214.30 219.60 5.30 100 Main 21.48 21.48 21.48 13.4141 41 ZAPRD668 191.35 194.35 3.00 100 Main 92.78 74.11 58.11 26.1142 42 ZAPRD732 224.20 225.60 1.40 100 Main 44.29 44.29 44.29 30.0043 43 ZAPRD733 270.00 271.30 1.30 100 Main 4.51 4.51 4.51 4.5144 44 ZAPRD736 308.00 310.40 2.40 100 Main 29.24 29.24 29.24 20.5945 45 ZAPRD737 284.00 289.00 5.00 100 Main 17.63 17.63 17.63 14.8846 46 ZAPRD749 112.80 114.20 1.40 100 Main 136.77 94.74 71.16 24.0247 47 ZAPRD750 126.40 132.35 5.95 100 Main 30.76 30.76 30.76 17.1948 48 ZAPRD751 116.20 123.00 6.80 100 Main 10.79 10.79 10.79 8.9849 49 ZAPRD752 151.70 155.65 3.95 100 Main 28.94 28.94 28.94 15.6150 50 ZAPRD753 166.00 167.00 1.00 100 Main 1.26 1.26 1.26 1.2651 51 ZAPRD770 216.00 219.00 3.00 100 Main 2.77 2.77 2.77 2.7752 52 ZAPRD771W 247.70 250.00 2.30 100 Main 7.40 7.40 7.40 7.2053 53 ZAPRD773 256.00 259.40 3.40 100 Main 12.01 12.01 12.01 12.0154 1 BKRC521 123.00 126.00 3.00 200 Central 21.47 21.47 21.47 12.4655 2 UZ25 15.42 18.72 3.30 200 Central 5.12 5.12 5.12 5.1256 3 UZ26 14.10 17.33 3.24 200 Central 0.61 0.61 0.61 0.6157 4 UZ27 13.92 16.92 3.01 200 Central 4.14 4.14 4.14 4.1458 5 UZ28 17.44 22.17 4.73 200 Central 4.17 4.17 4.17 4.1759 6 UZ30 19.77 25.64 5.87 200 Central 8.05 8.05 8.05 7.3960 7 UZ30B 13.22 53.03 39.82 200 Central 19.08 10.61 9.40 5.7861 8 UZ31 11.55 19.87 8.32 200 Central 4.90 4.90 4.90 2.3862 9 UZ33 10.86 18.46 7.60 200 Central 2.09 2.09 2.09 2.09

Appendix 4Resource Model Interval Table

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Model # Lode # HOLE-ID FROM TO LENGTH ROCKCODE LODE AU_NOCUT AU_120 AU_90 AU_30

Appendix 4Resource Model Interval Table

63 10 UZ34 6.15 8.48 2.32 200 Central 0.28 0.28 0.28 0.2864 11 UZ39 16.16 50.18 34.02 200 Central 18.27 14.17 12.85 7.5165 12 UZ40 17.61 58.89 41.29 200 Central 39.67 21.18 18.52 9.4666 13 ZAPRD661 179.00 180.00 1.00 200 Central 39.87 39.87 39.87 30.0067 14 ZAPRD737 301.00 306.00 5.00 200 Central 7.50 7.50 7.50 7.5068 15 ZAPRD751 135.59 138.30 2.72 200 Central 20.66 15.13 11.82 5.1969 16 ZAPRD752 172.64 178.43 5.80 200 Central 14.95 14.95 14.95 8.8470 1 BKRCD520 84.00 87.00 3.00 300 Fissure 7.60 7.60 7.60 7.6071 2 UZ01 8.00 11.21 3.21 300 Fissure 3.52 3.52 3.52 3.5272 3 UZ02 9.37 13.71 4.34 300 Fissure 3.92 3.92 3.92 3.9273 4 UZ04 12.00 12.46 0.46 300 Fissure 0.31 0.31 0.31 0.3174 5 UZ05 12.10 15.75 3.65 300 Fissure 2.83 2.83 2.83 2.8375 6 UZ06 22.40 28.00 5.60 300 Fissure 21.68 21.68 21.68 16.5876 7 UZ08 15.00 17.80 2.80 300 Fissure 12.11 12.11 12.11 12.1177 8 UZ09 16.10 20.46 4.36 300 Fissure 4.31 4.31 4.31 4.0978 9 UZ34 73.83 75.63 1.80 300 Fissure 6.92 6.92 6.92 6.9279 10 ZAPRD564 121.00 123.00 2.00 300 Fissure 2.31 2.31 2.31 2.3180 11 ZAPRD660 147.10 148.00 0.90 300 Fissure 5.08 5.08 5.08 5.0881 12 ZRC58 50.24 52.73 2.49 300 Fissure 5.28 5.28 5.28 5.28