For personal use only - Australian Securities Exchange · 2 HERALD RESOURCES DAIRI ZINC/LEAD...
Transcript of For personal use only - Australian Securities Exchange · 2 HERALD RESOURCES DAIRI ZINC/LEAD...
EMERGING ZINC/LEAD PRODUCER
QUARTERLY REPORT JUNE 2007
HIGHLIGHTS
♦ Development - Activities continue while awaiting final approval - No major increases to project cost forecast at this stage
♦ Exploration
- Lae Jehe results continue to impress - Encouraging sampling results received from Lae Puncu - Good lead and silver intercepts obtained at Sinar Pagi
www.herald.net.au
www.jaguarminerals.com.au
www.coronagold.com.au
31 July 2007
HERALD RESOURCES LIMITED ABN 15 008 672 071 Level 3, 50 Colin Street, West Perth Western Australia 6005 PO Box 893 West Perth Western Australia 6872
Tel +61 8 9322 2788 Fax +61 8 9481 1669 Email [email protected] Web www.herald.net.au
For
per
sona
l use
onl
y
2
HERALD RESOURCES DAIRI ZINC/LEAD PROJECT Herald 80% PT Antam 20% OVERVIEW Development activities at the Dairi zinc/lead project continued throughout the quarter. The Dairi Feasibility Study (“DFS”) is based solely on a 1Mtpa development of the high-grade Anjing Hitam deposit (diluted Reserves 6.6MT @ 15% Zn, 9% Pb) for an initial mine life of 7 years, although substantial other Resources also exist within the project area, e.g. Lae Jehe, where ongoing drilling has thus far delineated Resources of 6.5Mt @ 11.3% Zn & 6.1% Pb. FORESTRY APPROVAL PROCESS As previously advised, the Company is awaiting forestry approval in order to proceed to full development at the Dairi Project. In May the Company advised that Commission IV (a sub-committee of the Indonesian Parliament) had recommended that the Minister for forestry issue the forestry approval. At a working session in June, the Minister responded that, in his opinion, in order for him to issue approvals for underground mining in protected forests, a Presidential Decree would be required. A draft Presidential Decree, compiled jointly by the Depts of Forestry, Energy/Minerals and Environment, has been submitted to the President through the Cabinet Secretariat and is currently being reviewed by the legal section of the Cabinet Secretariat office. That draft states that permits for underground mining in protected forests should be issued for projects where the feasibility and environmental studies for site construction have been approved after consultation with the Forestry Department, and the project otherwise complies with the prevailing legislation. Transitional provisions exempt studies already approved and remaining current e.g. those for the Dairi Project.
For
per
sona
l use
onl
y
3
HERALD RESOURCES There is also a belief in some government circles that a government regulation (rather than the Presidential Decree) would be a more appropriate enabling device, so this is being drafted as well in consultation with various interest groups. Procedurally the government regulation needs to be signed by the President and the Minister for Law & Human Rights. Assuming the Presidential Decree and/or the regulation is issued, the Company would expect that the Minister of Forestry would grant forestry approval for the Dairi Project in short order thereafter. DEVELOPMENT ACTIVITIES
Construction of access road EPCM Works/Capital Costs The Project is progressing under the negotiated terms of the EPCM engineering contract with Ausenco Ltd. Formal signing of the contract will occur subject to Forestry permit approval which directly affects milestone completion dates to be written into the contract. Engineering Design Engineering and design of the process plant and infrastructure is well progressed. The delay to access into the forest area has provided time to further rationalize earthworks design at the plantsite. There has been a reduction in process plant earthworks construction volumes and the thickening and filtration areas of the plant have been relocated to a lower elevation in the valley. The decision has been made to relocate the tailings facility which will enable a significant increase in the storage volume. The facility has been redesigned to suit the revised location and application for approval is underway.
For
per
sona
l use
onl
y
4
HERALD RESOURCES The port facility designs are progressing with the design and construct contractor. Container offloading and concentrate dumping equipment design and construct pricing is currently being sought. Procurement and Contracts Tendering, adjudication and award has occurred on most major capital items. Most major equipment is now becoming available ex works and arrangements are underway to import the equipment and transport it to a consolidation area that has been secured at the port of Belawan in Northern Sumatra. Flotation cells have been transported to a consolidation yard at the town of Sidikalang and placed in the company laydown area awaiting construction. The accommodation camp mess and wet buildings have been fabricated, containerized and delivered, awaiting commencement of camp construction. Water treatment plants required for the camp facilities and process have been ordered. The Contractor carrying out the access road and camp area earthworks has almost completed the scope of work and will be demobilizing shortly. The bulk earthworks contract for the final section of access road and the complete process plant and infrastructure has been put out to tender. The tenders for the construction of the ring road section of the Sidikalang to Parongil regional road are under adjudication. Road, Port Agreements Agreement is in place with the Public Works authority to allow upgrade of the road between Sidikalang and Parongil. Final landowner surveys are underway and authorities are starting to prepare land transfer documents to facilitate the land acquisition required. The lease agreement between the Company and the Port authority for use of the land and waters at Kuala Tanjung is in place. The permit allowing the Contractor to commence clearing and to establish the construction site has been issued and this work is underway. The dredging and final construction permit are scheduled for issue this quarter. The long term use of the private access road to the port is under final negotiation. Construction The regional road works that are to occur between Sidikalang and Parongil are divided into a new 4km ring road around Sidikalang and 22km of upgrade of existing road. The 4km ring road works has been tendered and pending completion of land acquisition activities on that section of road, construction should commence early 4th quarter 2007. The upgrade works on the
For
per
sona
l use
onl
y
5
HERALD RESOURCES 22km of existing road has effectively begun with the Company working on small sections of the road already. A final survey of private landowners who will be affected by the upgrade works is nearing completion in advance of finalizing land acquisition. Tenders for the upgrade works are expected to be put to the market in the coming quarter. Construction work on the access road up to the forestry boundary and the earthworks associated with the accommodation camp is nearing completion. Construction works on the accommodation camp will commence shortly. Clearing and Contractor site establishment are underway at Kuala Tanjung port facility. Mining Contract and Planning PT McConnell Dowell Indonesia has been appointed to carry out all mining operations for the first four years of the mine’s life under a schedule-of-rates contract. Heavy equipment for the mining operation has been ordered. An Underground Manager has been recruited to head the mining department. This will facilitate detailed mine planning and scheduling and the establishment of standards for safety and health and mine design. Detailed geotechnical and cemented paste backfill studies are being carried out to allow mine development and support design to be finalised. Plant Construction Schedule & Capital Cost The date for commissioning of the process plant is dependent upon the granting of forestry approval to access the plant site area, and acquisition of the remaining land along the access corridor. Following the design changes referred to above and other matters, project times and cost schedules are currently being re-estimated by the project engineers Ausenco. Subject to the above review, the Company estimates total capital costs coming in at US$192M. This compares with the previous estimate made in November 2006 of US$182M i.e. a 5% increase in US$ terms since that time, however with the increase in the exchange rate over that period, the AU$ equivalent cost has actually decreased.
For
per
sona
l use
onl
y
6
HERALD RESOURCES EXPLORATION Lae Jehe Introduction The Lae Jehe prospect is located about 1.5km north of the main Anjing Hitam orebody and 800m north of the planned concentrator site. Lae Jehe is the most advanced target to provide future mill feed following the initial 7 year mine life at Anjing Hitam. The combined indicated and inferred resource at Lae Jehe stands at 6.5 Mt at 11.3% Zn, 6.1% Pb. Drilling continued through the quarter with two drill rigs in operation. Two deep holes and three shallow holes were completed. Drilling Drilling at the southern end of Lae Jehe “Deeps” on sections 700N and 800N (see attached cross section and longitudinal section) has demonstrated a downdip continuation of the interpreted M2 massive sulphide horizon on both sections in holes SOP253D and SOP256D respectively. Hole SOP253D intersected high grade, banded, massive sulphides (M2) horizon of 6.0m (estimated true width 5.4m) @ 15.6% Zn, 8.0% Pb. This intersection is 50m downdip from drill hole SOP218D. Hole SOP256D intersected 12.1m (estimated true width 11.3m) of pyritic and banded massive sulphides (M2) horizon at a distance of 35m downdip from drill hole SOP167D. Assays are awaited. Both SOP253D and SOP256D indicate a flattening of the dip of the M2 horizon which may be due to a kink in the horizon or even possibly due to faulting. Both drill holes flattened more than anticipated and thus intersected the mineralised horizon closer than anticipated to the previous drill holes. Therefore, the original targets still remain to be tested on these sections. The intersections have, however, confirmed the good widths and grade that are now expected in this part of the M2 horizon.
For
per
sona
l use
onl
y
7
HERALD RESOURCES The southern end of Lae Jehe was also targeted with the shallow drilling, and the 3 holes completed in the quarter have intersected various horizons in this area. Hole SOP254D, on Sopokomil grid 10900N, made a best intersection in the M1 horizon of 3.5m of 15.5% Zn, 12.9% Pb. The M2 and M3 horizons were also intersected as were other mineralised zones (see table below). Hole SOP255D, on the same section as, and down dip from SOP254D, intersected the M2 horizon as massive sulphide bands within carbonaceous shale and assayed 2.95m @ 8.5% Zn, 4.6% Pb. Hole SOP257D, drilling northwards from the same site as SOP254D, SOP255D, made relatively thin intersections on the M1, M2 and M3 horizons. Assays are awaited. Lae Jehe Drill Intersections Hole North East Dip/
Azimuth (mag)
From (m)
To (m)
Width (m)
ETW (m)
Zn (%)
Pb (%)
Ag (g/t)
Horizon
SOP253D 700 1346 -63°/210° 545.50 551.50 6.00 5.39 15.61 7.96 5 M2
SOP254D* 10925 4900 -53°/250°
75.53 82.90 91.60
100.00 218.90
79.00 83.90 94.22
101.00 222.70
3.47 1.00 2.62 1.00 3.80
3.45 0.99 2.60 0.99 3.78
15.51 7.35 7.51 3.04 3.83
12.95 2.68 4.58 1.15 0.70
11 6 4 4
10
M1 M2 M3 ?
MVT**
SOP255D* 10925 4900 -85°/250° 122.80 125.75 2.95 2.37 8.48 4.61 3 M2 SOP256D 700 1346 -65°/210° 518.20 530.32 12.12 11.27 Assays awaited M2 SOP257D* 10925 4900 -55°/307° 133.40
136.40 151.45
134.40 138.70 152.45
1.00 2.30 1.00
0.78 1.80 0.78
Assays awaited
M1 M2 M3
(N.B. Azimuth 210° magnetic is equivalent to 270° Lae Jehe Grid) * Hole drilled on Sopokomil Grid where azimuth 250° magnetic is equivalent to 270°. ** Carbonate hosted Mississippi Valley Type mineralisation. Pre-Feasibility Study Work on the schematic mining plan is due to commence in the current quarter. The present aim is to complete the PFS by the March quarter next year. Half drill core from SOP256D has been despatched from site for further metallurgical testwork which will take place over the next six months.
For
per
sona
l use
onl
y
ÃÃÃÃ
Ã
ÃÃ
Ã
à Ã
ÃÃ
Ã
ÃÃ
EnggangMo-Fe-Zn
Basecamp
BululagaPb-Zn-Ag
Lae Puncu
Lubuk RayaPb-Zn-Ag
Sinar PagiPb-Ag
SitapitapiZn-Bi-Fe
Batu Kapur
Lae LembaraPb-Zn-Ag-Mo
Pondok Gambir
Lae MaromasPb-Zn
Anjing Hitam
Lae JeheBongkaras
Lae Rimoh
Basuki
Dairi CoW
Sarkea SIPP
3 00'No
2 55'No
98 1
5'Eo
2 40'No
2 45'No
2 50'No
SIDIKALANG(REGENCY CAPITAL)
0 5 Kilometers
98 1
0'Eo
98 0
5'Eo
N
DAIRI AND SARKEA PROJECTSLOCATION OF MAIN PROSPECTS
à Prospect location with main commodities
%
PARONGIL
Sopokomil DomeZn-Pb-AgProspects
SOPOKOMIL
For
per
sona
l use
onl
y
[email protected]/0.6/12
[email protected]/2.3/21
[email protected]/2.6/31
[email protected]/1.1/10
DA
JE
JE
SO
JE JU
Ju12
Ju12
BK
SO
P169
D
M2
M3
M2
M4
M5
M6
SO
P 1
2D
SO
P16
8D
SO
P22
2D
SO
P22
8D
SO
P25
3D
70
0E
70
0E
80
0E
80
0E
90
0E
90
0E
10
00
E1
00
0E
11
00
E1
10
0E
12
00
E1
20
0E
200mRL 200mRL
300mRL 300mRL
400mRL 400mRL
500mRL 500mRL
600mRL 600mRL
700mRL 700mRL
LEGEND
Siltstones/dolomitic siltstones
Carbonaceous shales
Upper/Lower Zones massive sulphide horizons
Massive quartz veined dolomite
MVT mineralised zones
Shale and dolostone
Fault/thrust zones
Base of moderate weathering
Down hole width @ Zn%/Pb%/ppm Ag
DA
JU
JE
SO
SCALE 1:
DAIRI PROJECT - SUMATRA
SOPOKOMIL PROSPECT
LAE JEHE SECTOR
CROSS SECTION 700N
3000
0 20 40 60 80 100
100mRL 100mRL
SO
P253D
For
per
sona
l use
onl
y
ÊÚ
ÊÚ
ÊÚ
#S
#S#S
#S
#S
#S
#S
#S
#S
#S
#S
#S
#S
#S
#S
#S#S
#S#S
#S
#S
#S#S
#S#S
#S
#S
#S
#S#S
#S#S
#S
#S
#S
#S
#S
#S
#S#S
#S
#S#S
#S
#S
5D
6D
7D
8D 9D
10D
11D
12D
13D 16D
17D
39D 40D
49D
52D
54D
57D
59D 60D
166D
167D
168D
169D
170D
171D 172D
186D
196D
205D
206D 207D
208D
209D
Rob 1
SaporangAnton
217D
221D
223D
219D
173D
218D 222D228D
240D
215D
229D
256D
253D
254D 255D
257D
"
1200N
1000N
800N
1000E
600N
Plan Projectionof Resources
Proposed Sitefor
Sopokomil JuluTreatment Plant
Figure 2
N
FIGURE 5
10400 N
10600 N
10800 N
11000 N
11200 N
11400 N
11600 N
10400 N
10600 N
10800 N
11000 N
11200 N
11400 N
11600 N
4600
E
4800
E
5000
E
5200
E
4600
E
4800
E
5000
E
5200
E
Drill Hole ID206D! Drill Hole Trace
LEGEND
Massive SulphideOutcropÊÚ
Sedex TraceTracksRivers / streams
LAE JEHEDRILL HOLE LOCATION PLAN
1:5000 0 50 100 Meters
For
per
sona
l use
onl
y
20016012080400
5000
Looking to 210 mag.(Grid West)
Upper Zone, M2 Horizon
LONGITUDINAL SECTIONLAE JEHE SECTOR
SCALE 1:
Massive Sulphide Outcrop
June Quarter Program
Drillhole Pierce Point (est. true width @ %Zn/%Pb)
Downhole EM Anomaly
Published Resource Outline at +5% Zinc Equivalent
1000mRL1000mRL
800mRL800mRL
600mRL600mRL
400mRL400mRL
200mRL200mRL
0mRL0mRL 12
00
N1
20
0N
10
00
N1
00
0N
80
0N
80
0N
60
0N
60
0N
Assays awaited257D
Assays awaited255D
[email protected]/2.7254D
Assays awaited256D
253D
229D
[email protected]/1.3223D (faulted)
[email protected]/11.3
240D
[email protected]/2.1228D
223D
222D
[email protected]/11.3
221D
Fault Zone
[email protected]/3.0219D
[email protected]/8.2218D
173D
beneath the fault zone.
Potential exists for further resources
Fault Zone
[email protected]/21.9Sapurang Anton
[email protected]/0.749D
205D
207D
[email protected]/0.5209D
[email protected]/0.917D
[email protected]/1.2172D
[email protected]/1.3186D
[email protected]/7.552D
[email protected]/6.9206D
[email protected]/5.659D
[email protected]/4.8208D
[email protected]/6.1196D
[email protected]/4.4166D
[email protected]/1.2170D
[email protected]/7.5167D
[email protected]/5.460D
[email protected]/5.2215D
54D
54D
[email protected]/11.4171D
[email protected]/6.313D
[email protected]/1.2169D
[email protected]/3.9168D
12D
[email protected]/1.511D
For
per
sona
l use
onl
y
11
HERALD RESOURCES Lae Puncu The major deposits identified at the Dairi Project to date (Anjing Hitam, Lae Jehe etc) lie on the eastern side of the large structure known as the Sopokomil Dome. Semi-detailed exploration recommenced at Lae Puncu, on the western side of the Sopokomil Dome, where preliminary exploration in 1999-2003 identified anomalous base metal values in stream sediments and a Helicopter Electromagnetic conductive anomaly, which coincide with Julu carbonaceous shale. Assay results from rock chip sampling during the qaurter at Lae Puncu returned values up to 10.4% Zn, 5.13% Pb and 15ppm Ag in the one sample. The highest lead assay was 7.56% Pb and the highest silver assay was 50ppm Ag in separate samples. Further work is planned including follow up of these high grade samples. Sinar Pagi Drilling continued throughout the quarter with holes SPA11D, SPA12D and SPA13D being completed on section 20,100E. These holes tested the strike extent of the galena (lead) mineralisation intersected by drill hole SPA09D, which was drilled on section 20,000E in the previous quarter. SPA09D intersected a 28.6m of 5% Pb, 78 g/t Ag partly oxidised galena lode with upper and lower zones which are less oxidised and more galena rich (see table below). Drill hole SPA11D was abandoned at 142.4m due to technical problems. Drill hole SPA12D tested the mineralised horizon some 200 meters down-dip from the target zone of drill hole SPA11D. It intersected a 6.8m quartz vein from 444.0m with up to 20% pyrite and unidentified black sulphides and traces of chalcopyrite and galena. The quartz-sulphide vein is hosted by altered and crackle-brecciated dolostone, and probably represents the target mineralised horizon. Drill hole SPA13D (essentially a redrill of the lode position near the SPA11D target) intersected a 4.7m mineralised zone from 234.4 - 239.1m, consisting of 3% galena, pyrite, quartz and carbonate veining in dolostone.
For
per
sona
l use
onl
y
12
HERALD RESOURCES
Sinar Pagi Drill Intersections
Hole North East Dip/ Azimuth
(mag)
From (m)
To (m)
Width (m)
ETW (m)
Zn (%)
Pb (%)
Ag (g/t)
Remarks
SPA09D 29780 20000 -50°/45° incl and
239.60 239.60 257.90
268.20 245.90 260.40
28.60 6.30 2.50
27.20 6.00 2.40
1.24 1.43 6.26
5.08 14.5 15.1
78 193 267
Part ox. Galena
rich
SPA10D 29780 20000 -75°/45°
Hole terminated in cavernous dolostone
SPA11D 29750 20100 -62°/45°
Hole abandoned due to technical problems
SPA12D 29750 20100 -75°/45°
SPA13D 29750 20100 -56°/45°
Assays awaited
(N.B. Azimuth 45° magnetic is equivalent to 5° Sinar Pagi Grid) Further drilling is planned for the September quarter to determine the orientation and extent of the galena lode of SPA09D.
For
per
sona
l use
onl
y
100806040200
2500
CROSS SECTION 20000E
SINAR PAGI PROSPECT
TIGA LINGGA BLOCK
DAIRI PROJECT - SUMATRA
SCALE 1:
Down hole width @ Zn%/Pb%/ppm AgDown hole width @ Zn%/Pb%/ppm Ag
Siltstones/ shales
Dolostone
Mineralised zone
LEGEND
900mRL900mRL
800mRL800mRL
700mRL700mRL
600mRL600mRL
500mRL500mRL
30
10
0N
30
10
0N
30
00
0N
30
00
0N
29
90
0N
29
90
0N
29
80
0N
29
80
0N
SP
A010D
SPA009D
SP
A001D
1.2/5.1/78
28.6m@ [email protected]/15.1/267
[email protected]/14.5/193
Void
4.6m @2.8/3.0/40
2.5m @6.3/0.6/6
9.1m @0.3/11.0/129
6m @ 0.5/23.1/179 (in surface trench)
[email protected]/7.4/369 (in surface trench)
[email protected]/25.7/72 (in surface trench)
For
per
sona
l use
onl
y
14
HERALD RESOURCES SARKEA BASE METALS PROJECT Herald 100% This area is centred about 10km south of the Dairi Project’s Anjing Hitam deposit. It is held under a SIPP prospecting permit covering 9,606ha. The assay results at Bukit Enggang, which were not available for the previous quarterly report, were generally disappointing apart from drill hole SKA11D which intersected 6.0m of 1.65% Zn from 5.05m downhole, which overlies a 10.05m zone assaying 0.3% Zn, 23.4 % Fe and 0.05% Sn from 13.05m downhole, and drill hole SKA14D which intersected an 11.85m zone assaying 0.4% Zn, 39.1% Fe and 0.10% Sn from 3.0m downhole. No further work is planned for the time being. MELUAK GOLD PROJECT Aceh Province Herald 26% via Corona Gold Ltd Meluak is contained within a 2,760ha SIPP prospecting permit issued by the Gayo Lues Regency. Discussions are continuing with the Regency authorities and the Mines Dept about converting the SIPP to a Contract of Work, which is deemed desirable prior to resuming drilling. Previous security concerns are no longer an issue. The original drill program intersected 72m @ 0.54 g/t Au from 7m, including 8m @ 1.95 g/t Au.
For
per
sona
l use
onl
y
15
HERALD RESOURCES MONTAGUE GOLD PROJECT Herald 15% free carried Airport (M 57/98, M57/99) No work reported this quarter. N.B. The above information is based on reports provided by WCP Resources Ltd, manager of the Montague JV. CRATER GOLD PROJECT Herald 20% free carried No work reported this quarter. N.B. The above information is based on reports provided by WCP Resources Ltd, manager of the Montague JV
For
per
sona
l use
onl
y
16
HERALD RESOURCES – CORPORATE CASH RESERVES At the date of writing, parent company Herald Resources Ltd held cash deposits of A$70M. VALE GRAEME HUTTON The Directors and staff of Herald were saddened by the passing of long serving non-executive director Graeme Hutton on 16 July 2007. Graeme joined the board in 1983 and oversaw the Company’s transformation to a successful mining company from that time. He will be greatly missed by all who knew him. M P WRIGHT Executive Director NOTE: Sections of information contained in this report that relate to Exploration Results and Mineral Resources were compiled or supervised by Mr B Kirkpatrick BSc, MAusIMM, MAIG who is a Member of The Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Mr Kirkpatrick, a full-time employee of Herald Resources Limited, has sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Mineral Resources and Ore Reserves”. Mr Kirkpatrick consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.
For
per
sona
l use
onl
y
17
HERALD RESOURCES - CORPORATE DIRECTORY
DIRECTORS BANKERS T M Allen, (Chairman) Societe Generale (Australia) M P Wright, BBus 400 George Street B J Hurley, AWASM, MAusIMM SYDNEY NSW 2000 J Dracopoulos, B.A. Acc, Grad Dip CSP, CPA COMPANY SECRETARY Challenge/Westpac M P Wright Banking Corporation 109 St Georges Tce SHARE REGISTRY PERTH WA 6000 Security Transfer Registrars Pty Ltd 770 Canning Highway AUDITORS APPLECROSS WA 6153 Stantons International 1 Havelock Street Telephone: 08 9315 0933 WEST PERTH WA 6005 Facsimile: 08 9315 2233 SOLICITORS AUSTRALIAN BUSINESS NUMBER Blakiston & Crabb 15 008 672 071 1202 Hay Street PERTH WA 6005 SHARE CAPITAL 193.5M shares REGISTERED OFFICE 8.4M options Level 3/50 Colin Street WEST PERTH WA 6005 Telephone: 08 9322 2788 Facsimile: 08 9481 1669 Email: [email protected]
www.herald.net.au For
per
sona
l use
onl
y